Draft Non-Domestic Rating (Rates Retention and Levy and Safety Net) (Amendment) and (Levy Account: Basis of Distribution) Regulations 2019
(5 years, 8 months ago)
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The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Rishi Sunak)
I beg to move,
That the Committee has considered the draft Non-Domestic Rating (Rates Retention and Levy and Safety Net) (Amendment) and (Levy Account: Basis of Distribution) Regulations 2019.
It is a pleasure to serve under your chairmanship, Sir Henry. I love being Minister for local government and I love local government finance, but no one ever wrote a sonnet about the business rates retention system. The technical nature of the draft regulations gives us a good idea why not; I pay tribute to my officials for preparing some very helpful explanatory notes to translate them into plain English.
The draft regulations will do two very simple things: provide the basis on which we will distribute the levy account surpluses, and make changes to the regulations that give effect to the business rates retention scheme—not least to create the 75% retention pilots in the forthcoming financial year. Let me take those matters in turn, beginning with the levy account surplus.
Under the rates retention scheme, authorities may be entitled to a safety net payment if their business rates income falls below a certain level. The cost of such safety net payments is met by charging authorities a levy of up to 50% of any business rates growth that they achieve. In the past, we have also top-sliced an amount from the settlement to supplement the levy income and ensure sufficient funding from which to make safety net payments. Since 2013-14, we have top-sliced a total of £255 million that would otherwise have been distributed to authorities through the settlement. Effectively, safety net payments are therefore paid for by the local government sector; central Government simply act as an agent to collect and distribute the sums between authorities.
The top-slice and all the levy and safety net payments are made into or from a levy account that is kept by central Government. In line with the legislation, any surplus in the levy account at the end of the year belongs to the sector and is to be distributed to local government or carried over to the next year. At the end of 2018-19, the levy account will show a surplus of £188 million. As we announced in the 2019 local government finance settlement, we have decided that £180 million of that surplus should be distributed back to the sector. Legislation requires us to set out in regulations the basis on which the surplus should be distributed. The draft regulations therefore provide that all authorities should get a share of the 2018-19 surplus, in line with their shares of settlement funding in 2013-14—the first year of the rates retention scheme, and the first year in which we top-sliced sums from the settlement.
I am pleased to tell the Committee that we fully consulted local authorities on the basis of the distribution at the time of the provisional settlement in December. Fully 93% of respondents supported the proposal, including all the relevant local government bodies, such as the Local Government Association, London Councils, the District Councils’ Network, SIGOMA—the Special Interest Group of Municipal Authorities—and the Society of County Treasurers.
Let me turn to the changes that we are making to the day-to-day administration of the rates retention scheme. The running of the scheme is dealt with by means of a number of sets of regulations, the most important of which are the Non-Domestic Rating (Rates Retention) Regulations 2013 and the Non-Domestic Rating (Levy and Safety Net) Regulations 2013. Those regulations provide, among other things, for the percentage shares of business rates to be paid by billing authorities to central Government and major precepting authorities, and for the way in which the levy and safety net payments are to be calculated.
The draft regulations will make a few changes. They will ensure that the relevant shares of business rates income and the calculation of levy and safety net payments for 2019-20 and beyond reflect the Government’s decisions to create 75% retention pilots for 2019-20; make changes to the structure of local government in Dorset, Suffolk, Somerset and Northamptonshire; change certain values for the Isles of Scilly used in connection with the scheme; and change the way in which levy and safety net payments are calculated to reflect the higher compensation given to local authorities as a result of improvements and changes made to the small business rate relief scheme.
This is a highly technical set of regulations but most of the provisions simply give effect to changes previously approved by this House, either in the settlement or in other regulations. They ensure that authorities get the sums from the rates retention scheme that they are due. I commend the regulations to the Committee.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Sir Henry. This is a very important issue. Although the regulations appear to be very technical, they are fundamentally about how we pay for local public services, and to what degree local areas raise their tax locally, retain it and then spend it in their locality, as opposed to returning it to central Government and then having it redistributed in a different way. The issues are important, and will materially affect the financial bases of the local authorities concerned.
The issues that the Labour party has with this set of proposals reflect our concerns about previous proposals. First, we are concerned about capacity within the Department. The National Audit Office report of March 2017 reported a reduction of nearly 40% in staffing capacity in the directorate responsible for delivering the programme; there was a 39.6% reduction in staff. We are also concerned about the viability of individual schemes where local authorities have to hold more in reserves pending the outcome of appeals. In 2017, that amounted to £2.8 billion. We are concerned about how much local authorities are being asked to keep in reserves pending appeals, when the national framework for business rates is decided by central Government, not local government.
However, we have a more fundamental problem with the direction in which the Government are taking local finance more broadly. The proposal is almost saying: “It’s survival of the fittest. If you can raise the money locally, you can retain it and spend it on public services. The measures by which you can raise it are usually outside of your control, such as your historical house price base, and your historical employment, industrial and commercial land supply base. If you can raise it through those measures, then good. If you can’t, you won’t be able to afford to fund basic public services in your area.” We see that with the reduction—indeed, now the almost entire removal—of revenue support grant.
With the shift towards business rate retention, what we are seeing is not new money or free money. Rather, there is a deal: things that are currently funded through central Government grants—for instance, the public health grant and the like—are being taken away and the money made up for, almost pound for pound, by business rate retention. The choice of areas is quite telling, because the effect on central Government coffers is broadly neutral. The amount being taken away in grants provided under the current scheme is broadly in line with the retention amounts being kept locally through the new powers. The question is: what happens when we talk to local authorities where there is a greater imbalance between the amount received through current grant funding and what they would receive under a move towards retention?
We share many of the concerns raised by the National Audit Office in its March 2017 report, on both capacity and the amount of money that councils are being expected to keep in reserves. The Government should step up and hold a more fundamental review of how councils are funded that goes beyond business rates and the fair funding review that is currently taking place. We have massive concerns about the removal of deprivation as a measure of funding need in a locality, as we know that it drives a lot of need in an area.
We do not support the Government’s proposed move towards a “survival of the fittest”, “sink or swim” settlement, but we recognise that they have been in discussions with Labour-controlled authorities and combined authorities. On that basis, we will not seek to divide the Committee. However, we are getting to the end of the road. I fear that some councils will really struggle to make ends meet, and not just those where the control of the council is questionable, as we have seen in some Conservative-controlled councils. The demand for services massively outstrips the amount of money that the council has for those services. The Government need to find a more sustainable solution to funding—not just taking it from the needy and giving it to the less needy. We need more money for our basic public services.
Rishi Sunak
As always, I welcome the comments of the hon. Member for Oldham West and Royton, which are always thoughtful and well informed. On this matter, however, I disagree with him. We will, of course, have more general debates on the right way to fund local government as we approach the spending review. I look forward to those discussions, which are slightly out of the scope of these regulations.
The crux of what the Committee is talking about today is the creation of 15 new business rate retention pilots. That is 15 new parts of the country where local authorities can keep 75% of the growth in the business income that they generate, rather than 50%, as in the normal system. That is central Government empowering local government to drive growth in their areas and to be rewarded for their efforts by keeping the proceeds of that growth.
Some 122 local authorities will benefit, including those of many Members present. Cumulatively, the extra money that local government will be able to keep will be around £490 million, when the 15 pilot areas in London are added together. Add that to the five existing 100% devolution areas that the Government have already created, and that is an additional £143 million. That is £633 million of incremental funding that the local government system is keeping as a result of driving growth in their areas.
That is what we are about on this side of the House: empowering local government to make decisions, to keep the proceeds of that activity and, in doing so, to provide a better community for their local residents. We are here today to implement that. I am pleased that the hon. Gentleman will not divide the Committee, and I thank him for his thoughtful comments.
Question put and agreed to.
Draft Immigration, Nationality and Asylum (EU Exit) Regulations 2019
(5 years, 8 months ago)
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The Committee divided: - Ayes: 9 / Noes: 8 - Question accordingly agreed to.
The Minister for Immigration (Caroline Nokes)
I beg to move,
That the Committee has considered the draft Immigration, Nationality and Asylum (EU Exit) Regulations 2019.
Delivering a deal with the EU remains the Government’s priority. We are, nevertheless, preparing for a range of scenarios. As the Prime Minister has pointed out:
“The legal default in UK and EU law remains that the UK will leave the EU without a deal”
on 29 March
“unless something else is agreed.”—[Official Report, 13 March 2019; Vol. 656, c. 464.]
UK domestic law has given effect to the obligations in the fields of immigration, nationality and asylum that arise from our membership of the European Union. The UK has also been subject to directly effective EU law. When we leave the EU, aspects of our legislation and retained direct EU law will fail to operate effectively; if they are not modified or revoked by this instrument, they will contain deficiencies.
The draft regulations will make changes to a range of domestic primary and secondary legislation to prevent, remedy or mitigate deficiencies in law that arise from the UK’s exit from the EU. They will ensure that if the UK leaves the EU without a deal, our statute book will operate on exit day until new legislation on these issues is commenced.
First, the draft regulations will make the technical changes required to correct wording in our legislation that describes the UK in terms of our membership of the European Union or the European economic area. Those changes will not alter the legislation’s effect. Similarly, the draft regulations will make technical amendments to domestic legislation that refer to EU rights retained by the European Union (Withdrawal) Act 2018.
Secondly, the draft regulations will revoke relevant retained EU legislation relating to immigration. They will also revoke a number of instruments that give effect to the UK’s membership of the EU asylum acquis and that will be inoperable on exit. By leaving the EU, the UK will also leave the asylum acquis. The draft regulations will therefore revoke the Dublin regulation and the Eurodac regulation.
Thirdly, the draft regulations will make a number of transitional and saving provisions in relation to the measures that they will amend, so that the amendments in question do not have an inappropriate effect in respect of decisions or other actions taken before their commencement.
Finally, the draft regulations will apply the UK rules for criminality to EEA, Swiss and Turkish nationals. This amendment applies only to their conduct after exit. Our intention, which the Home Secretary has already announced, is to apply the same rules to new arrivals, irrespective of which country they come from.
The Government believe that we must plan for every eventuality, including a no-deal scenario. In introducing the draft regulations, we are taking practical steps to ensure that the UK statute book will operate effectively on exit in the event that the UK leaves the EU without a deal. The draft regulations will prevent deficiencies in immigration and asylum law that arise from the UK’s leaving the EU, and will ensure continuity until the Immigration and Social Security Co-ordination (EU Withdrawal) Bill allows the Government to introduce the future borders and immigration system. I commend the regulations to the Committee.
Afzal Khan (Manchester, Gorton) (Lab)
It is a pleasure to serve under your chairmanship, Mr Hanson.
Labour opposes the draft regulations on four grounds. First, they will make changes to 21 separate pieces of primary legislation—something that should rightly be done through primary legislation. The Immigration and Social Security Co-ordination (EU Withdrawal) Bill, which has just come out of Committee, was surely the perfect vehicle for any necessary changes to primary legislation before exit day. Putting those changes into a Bill would have allowed more time for hon. Members to scrutinise exactly what they will mean for each of the Acts affected, and to table amendments if necessary. We accept that many of the changes are technical, but they could easily have been spelled out in the Bill and nodded through in Committee.
Our second reason for opposing the draft regulations is that on the Bill Committee we spent a lot of time talking about how chaotic and disorganised the current immigration rules are. They are almost impossible for immigration lawyers, judges and Home Office officials to understand, let alone the average person applying for a visa without the help of legal aid. The point of supplementary scrutiny is not just to criticise the Government, but to consider and improve what they are doing. More chances for scrutiny would avoid contradictory rules and bad laws.
Thirdly, the draft instrument puts the cart before the horse. We do not yet know whether the immigration Bill will become law, as it faces significant hurdles before Report in the Commons and has not yet been through the Lords. This statutory instrument makes changes for a post-Brexit immigration landscape that is not yet assured.
Finally, the statutory instrument revokes the Dublin III regulation, which determines which EU member state is responsible for returning an asylum claim.
Stephen Timms (East Ham) (Lab)
I am pleased that my hon. Friend raises the question of the Dublin agreement. Is it his understanding, as it is mine, that a significant number of families who can currently be reunited thanks to that regulation could no longer be if there were no deal and we were to exit on the basis of the SI before the Committee?
Afzal Khan
I wholeheartedly agree with my right hon. Friend. We accept that leaving the EU will mean leaving Dublin III, but we would have liked continued co-operation on family reunion even in a no-deal scenario.
Dublin III has been a crucial mechanism for reuniting refugee families. In 2018, over 1,000 people were reunited with family members in the UK under that regulation, including over 150 children. If the UK leaves the EU with a deal, Dublin III will remain in place until the end of the transition period, during which time the Government are committed to negotiating reciprocal arrangements on separated children. That should be expanded to include all the family reunion cases allowed under Dublin III.
If we leave without a deal, we will immediately cease to be part of Dublin III, and many refugees will be unable to be reunited with their families from 29 March. UK immigration rules contain provisions for the reunion of refugee families, but evidential requirements are higher than under the Dublin III regulation, in which the definition of “family member” is broader. We support calls for the UK’s immigration rules to be more generous in family reunion cases, so that children can sponsor family members and the definition of “family” is broader.
We welcome the Government’s inclusion of a saving provision in the draft regulations to allow for take-charge requests made before exit day to continue to be considered. In the light of delays between an application for asylum and the submission of a take-charge request, however, what consideration was given to making the asylum application the cut-off for the process, rather than the take-charge request?
Stephen Timms
It is a pleasure to serve under your chairmanship, Mr Hanson; I apologise for being a couple of minutes late to the Committee. I want to underline the points made by my hon. Friend the Member for Manchester, Gorton.
I am grateful to the British Red Cross for circulating to us some information on the impact of the instrument in the event that the UK leaves the European Union without a deal. I am grateful that the Minister has made it clear that if we leave with a deal, the Government will use the subsequent transition period to ensure that we will be part of the Dublin III regulation. That is a very welcome assurance.
The problem is that if we leave without a deal, we will immediately be in a position whereby Dublin III will not apply to us. Instead of passing this SI, should the Government not commit to keeping us in Dublin III for the period immediately after we leave—if we leave without a deal—to ensure that the type of family reunions that are now possible continue at their current level, which, as my hon. Friend rightly pointed out, was significant in 2018?
It is not clear why the SI has been framed in such a way that we would leave the Dublin III regulation immediately on exiting the EU if we did not have a deal. It is clearly the Government’s intention that we should be part of that arrangement in the longer term. As I have said, I am glad that the Government have committed to thinking about negotiating that during the transition period. However, I am concerned that, as worded, the SI would take us out of that regulation immediately if we left the EU without a deal, so I hope the Government will take a different approach on that point.
Sir John Hayes (South Holland and The Deepings) (Con)
I will speak briefly, Mr Hanson, by way of an alternative to intervening on the Minister, because it will give her more opportunity to reflect on what I have to say, and I only really want to say one thing.
First, this statutory instrument, like many others that we are debating at the moment, changes an enforceable EU right into a retained enforceable EU right. That is the pattern of what we are doing, but it is really important that we recognise that while that is acceptable for a limited period—a transition period—it is not acceptable long term. We need to revise our thinking sufficient to satisfy the expectations of the population who regard our immigration policy as having been out of control for some time. Secondly, there is a need to skill our own people to do many of the jobs that have been done by EU migrants in recent times. Thirdly, I want to respond to the profound concerns that people in my constituency and others have about population growth. We are growing our population at something like a quarter of a million per year, and that simply cannot be maintained indefinitely. It places immense pressure on public services, it changes the character of the place in which we live very significantly, and people do not want any more of it.
Sir John Hayes
On that note, and without wishing to detain colleagues on the Committee unduly, I happily give way to my hon. Friend.
Michael Fabricant
I am very grateful to my right hon. Friend for giving way. He is showing the advantage of making a little speech-ette rather than asking a question, as it enables me to intervene on him. As one Administration cannot bind another, can he not be assured that something like this order cannot be everlasting forever?
Sir John Hayes
I am guided and informed, as ever, by the expertise and diligence of my hon. Friend, who brings both those things, among many other virtues, to all of his work and to our endeavours. He is right, of course, that leaving the European Union provides a chance—but no more than that—to reconsider what future we want to build. I do not want to open up this debate—indeed, you would not let me, Mr Hanson—except to say that my hon. Friend, as ever, makes an apposite, incisive and erudite contribution to our affairs.
With that—some might say excessively complimentary —response, I will bring my remarks to a conclusion. I simply seek the Minister’s assurance that the Government will indeed look afresh at these things. I do not say that we will change everything; of course we will not. We will continue those things that are right for Britain, and many are, but we would not want simply to plough on regardless.
Caroline Nokes
I fear that I will not make a speech-ette, but there will certainly be no ploughing on regardless either. I am grateful for the Committee’s contributions to the debate and I will address some of the issues raised.
The hon. Member for Manchester, Gorton asked why we are not using the immigration Bill for these provisions. Of course, these provisions are very much in preparation for no deal, which is an eventuality that I do not want. The Government continue to work hard to secure a deal, but unless alternative arrangements are made, it is the default legal option. As he pointed out, the immigration Bill has just completed its Committee stage in the Commons and, to be frank, we do not expect it to have Royal Assent by 29 March, which is when these measures might be needed.
The use of secondary legislation and the immigration rules, as the hon. Gentleman mentioned, is a long-established method that we have used to make changes to the immigration system. Under those well-established procedures, such changes are still subject to proper parliamentary oversight and debate, including through Committees such as this. The hon. Gentleman will know, as we discussed at the Committee stage of the immigration Bill, that the Law Commission is currently conducting a public consultation on the simplification of the immigration rules, commissioned by the Government. We look forward to receiving its response and considering its report in due course. As he knows, I am on record as having said that such simplification is much needed.
The right hon. Member for East Ham and the shadow Minister mentioned the Dublin III regulation, which is arguably the most significant regulation revoked by this instrument. As Members will be aware, the Dublin regulation contains rules for establishing the criteria and mechanisms for determining the member state responsible for examining an asylum application lodged in a member state by a third-country national or a stateless person, and the legal framework for returning asylum seekers to, and accepting them from, the EU. This instrument ensures that the statute book will continue to function effectively for asylum in a no-deal scenario and provide transitional arrangements. Should the UK leave the EU with no deal, those Dublin requests relating to family reunification that are still pending resolution will continue to be considered under existing provisions. That would apply to any take-charge requests that we have received before exit.
Stephen Timms
I am grateful to the Minister for that reassurance that applications that are already in the system will continue to go forward. However, given that the Government have committed to seeking to extend the Dublin III arrangements for good if we get a deal, should this SI not provide for us to continue those arrangements in the event of no deal as well? I cannot think of any reason why leaving the EU without a deal should prove disadvantageous to families seeking reunion under the existing asylum arrangements.
Caroline Nokes
I welcome that intervention, but we have to be realistic about leaving the European Union and needing a cut-off date. Dublin is a reciprocal mechanism, and we cannot oblige other EU member states to comply with the process after the UK has left the EU. The right hon. Gentleman is absolutely correct: we want a comprehensive readmission agreement that could include family reunion, if that were reciprocated. However, given the wider issues at stake with the EU, including matters such as data adequacy, we cannot continue Dublin III post exit.
As a consequence of leaving the EU, the UK will no longer be a participating state in the Dublin regulation. That certainly presents a challenge, but it also presents us with an opportunity to seek new agreements with the EU on asylum that better reflect our position as a third country. Since 2016, we have accepted more Dublin transfers than we have returned to our EU partners. The latest available published data shows that 209 people were returned to the EU27 under Dublin 2018, meaning that returns under that regulation make up about 5% of total asylum returns.
This instrument is designed to prevent any deficiencies arising from the UK leaving the EU. It ensures continuity until the Immigration and Social Security Co-ordination (EU Withdrawal) Bill allows the Government to introduce the future new borders and immigration system. On that basis, I commend the regulations to the Committee.
Question put.
Draft Animal Welfare (Amendment) (EU Exit) Regulations 2019
(5 years, 8 months ago)
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The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (David Rutley)
I beg to move,
That the Committee has considered the draft Animal Welfare (Amendment) (EU Exit) Regulations 2019.
As always, it is a pleasure to serve with you in the Chair, Mr Gapes. This statutory instrument applies to the UK, and is made under the enabling power in the European Union (Withdrawal) Act 2018 to transfer powers currently held by the European Commission to the appropriate UK Ministers. The instrument is technical in nature, and is to ensure a smooth transfer of powers from the EU to the UK. I first make it clear that this instrument does not make any change to policy, except in relation to the recognition of EU-authorised slaughterers; I will set out those changes later.
Secondly, I also make it clear that this instrument in no way diminishes our controls in the critical area of animal welfare. The UK has some of the highest animal welfare standards in the world, which will continue to apply through existing UK legislation and, indeed, retained EU law. There is no intention to use any powers transferred through this instrument from the EU to appropriate Ministers in the UK to reduce animal welfare standards. In fact, that transfer of powers will enable animal welfare regulation in the UK to be further strengthened as new research and evidence emerges.
Gareth Johnson (Dartford) (Con)
Can the Minister give me some reassurance—he may have gone some way towards doing so in his opening comments—that post Brexit, his Department will carry out a review of animal welfare protections, giving consideration to how we can improve this country’s animal welfare standards where it is practical and correct to do so?
David Rutley
I thank my hon. Friend for his question. I know he has a keen interest in this issue, and I assure him that through the statutory instruments we have been debating over recent weeks, we will make sure that current EU law is brought into the UK. We are committed to going further: we will address the issue of animal sentience, increase sentences for animal cruelty and ban wild animals in circuses, all through primary legislation. We will also ban third-party puppy and kitten sales, which I know is an issue of real interest, not least to my hon. Friend the Member for Lewes. We have a very full agenda.
Ian Murray (Edinburgh South) (Lab)
Could the Minister tell us in his opening remarks how much his Department has spent on these statutory instruments in this week alone, let alone the past few months?
David Rutley
I will seek some inspiration during the course of my opening speech. It will be difficult to give specific details, but obviously this SI is part of a broader package of preparing for all eventualities, whether a no-deal scenario or a deal. Of course, within the Department for Environment, Food and Rural Affairs, bringing environmental, agricultural and fisheries legislation into the UK represents a huge, transformational change.
I also assure members of the Committee that, in transferring powers over animal welfare from the EU, we have the expertise and capability within agencies such as the Animal and Plant Health Agency and the Food Standards Agency to robustly enforce animal welfare requirements and ensure that the regulations are strengthened sustainably over time. Animal welfare is a devolved policy area, and frameworks are in place to ensure close collaboration with devolved Administrations in this area, including a consensus that high standards should be retained as we leave the EU.
The instrument primarily makes minor operability changes to three pieces of legislation to ensure that retained direct EU legislation protecting the welfare of animals kept at control posts, while being transported, and at the time of their killing will continue to operate effectively once the UK has left the EU. The first piece of legislation, EC regulation 1255/97, relates to control posts—that is, approved areas for animals to be unloaded, fed, watered and rested for at least 12 hours during long journeys. There are currently 11 designated control posts in the UK, and the EC regulation sets out the health and hygiene requirements for control posts and details how they should be constructed, operated and approved. The SI makes a number of minor operability changes, including updating references and definitions. As is currently the case, the power to designate or suspend control posts will remain devolved to the relevant Ministers in the devolved Administrations. The SI will not alter the current requirements or standards for control posts; those will be maintained after exit.
The second piece of legislation, EC regulation 12005, relates to the welfare of animals during transport and sets out the standards to be applied when moving live vertebrate animals for commercial purposes, as well as the necessary documentation to accompany the journey and the checks to be carried out on consignments leaving or entering the EU. The regulation also sets out the requirement for transporters, drivers and vehicles to be authorised. The regulations before us will enable such authorisation, issued by an EU member state, to continue to be recognised in the UK, an approach that will help to minimise friction at the border and prevent potential animal welfare issues arising from delays in animals entering the UK from the EU.
Finally, the instrument makes technical changes to EC regulation 1099/2009 on the protection of animals at the time of killing, to ensure that it remains operable after the UK exits the EU. The regulation requires that animals shall be spared any avoidable pain, distress or suffering during both their killing and any related operations. It sets out detailed rules on the accepted methods of stunning and killing, as well as the layout, construction, equipment, handling and restraining operations at slaughterhouses. The draft instrument will not alter the current requirements or standards, maintaining them after exit.
I draw the attention of hon. Members to one policy change in the regulations. EC regulation 1099/2009 requires all slaughterers to be trained and competent in the task they undertake, with certificates of competence issued by a competent authority. Currently, a certificate of competence issued by an EU member state must be recognised in the UK. The regulations will end that requirement because the continued recognition of certificates issued by other member states would open up potential enforcement issues. We would be unable to suspend or revoke a certificate if a slaughterer breached the requirements of the retained EU, or domestic, legislation.
The impact on businesses in all parts of the UK will be minimal. By not continuing to recognise certificates of competence from EU member states, a limited number of slaughterhouse employees will need to apply for a certificate from a competent authority in the UK to continue to work here after exit. Applying will cost about £225, and we expect fewer than 200 individuals in the UK to be affected—about 3% of all slaughterers.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
The Minister will know from other Statutory Instrument Committees that I pay close attention to impact assessments, and on page 6 of the explanatory memorandum, it states:
“An Impact Assessment has not been prepared for this instrument as there are limited impacts on business”.
However, the Minister just told us that the measure will have an impact on 200 people. What confidence can we have that it will be only 200, if no impact assessment has been prepared? This sounds like a severe and important change, and I would expect an impact assessment to have been prepared. Does the Minister not agree?
David Rutley
I agree that it is an important issue, but on whether there should be a fully scaled-up impact assessment, clear criteria are set out under the Treasury’s better regulation guidance. Because the measure affects only a small number of slaughterers, and the amount of money is small—£225, which, as I was about to say, is often picked up by employers—it falls well below the requirement for a full impact assessment. What I have wanted to do with this statutory instrument, as I know the hon. Gentleman and other Opposition Members have been keen to see, is, where possible, to set out what the costs could be, even if they are small.
I want to reiterate that in many cases employers pick up the costs. In line with the better regulation framework and in accordance with the Treasury Green Book guidance on impact assessments, an assessment was not required for this statutory instrument. Although there was no formal duty to consult because the changes are so minimal, we have engaged directly with industry representative bodies, and more widely, and have received no expressions of concern. The devolved Administrations have been consulted on the instrument and they support this approach.
I thank hon. Members for their contributions so far. The functions are vital if UK Ministers are to carry on their functions relating to animal welfare. Without those powers in UK law, respective UK Ministers would be unable to introduce measures that the EU Commission currently has the authority to introduce on behalf of member states.
It is therefore necessary for the operability of our animal welfare regulations, and to ensure that we can further strengthen those regulations sustainably over time, that we pass the statutory instrument. For the reasons that I have set out, I commend the statutory instrument to the Committee.
Dr David Drew (Stroud) (Lab/Co-op)
I am delighted to serve under your chairmanship, Mr Gapes. As always, I thank the Minister for his remarks.
I will start with the usual caveat. At one level, this is one of those Committees where we are merely nodding through something that may, in due course, become just a series of technical changes. However, this SI includes live exports, the pre-stunning of animals, journey times and other things that—if my postbag is anything to go by—people care passionately about in their own right, so we are nodding through something very important.
The Minister will come back with the usual proviso that the Government are not making any changes to the legislation—I will come on later to people who wish that the Government had made some changes to the legislation, particularly given their commitments to issues such as the banning of live exports—but as the Opposition, we have to do our best to ensure that what is passed is fit for purpose and gives us confidence that the situation will not change for the worse.
We are considering some difficult issues; I will mainly refer to what different groups have said about the regulations. When the Minister responds, it would be helpful for him to put on the record at an early stage where the Government are on their policy of banning live exports. They campaigned on the issue, and many Conservative MPs strongly support it, as stated in the 2017 manifesto, but there has been a rolling-back of the belief that it can be easily done.
We have not really touched on the difficulty that the different territorial Administrations have different views about the issue. For example, the Scottish Government feel that it should not be interfered with, because live exports into England, Northern Ireland and the south of Ireland are important for Scotland. We have to make sure, however, that when we pass the measure, at least the people responsible for undertaking those activities know exactly what the law says, and that the law is being enforced.
We as a Parliament have made many statements about how we want to ensure that journey times are kept to a minimum, and that animals are properly fed and watered—that word “lairage” appears—so they are taken out when appropriate and allowed to stretch their legs. It is the case that we cannot then control what happens in the EU, but we certainly must control what happens in the UK, so it is important that we get the regulations right.
As the Minister rightly said—hon. Members will be pleased to know that I will not say much about it—the statutory instrument refers to the regime for slaughterers’ certificates of competence. It sounds straightforward, but I ask the Minister which body will oversee that in the UK, because it will obviously have to comment on the suitability of other nationalities to do the type of work that they will be doing, which will depend on their qualifications in their own countries. We are losing the commonality of the EU, which was one of its great advantages, and which meant that there was at least some standardisation of qualifications.
As an introductory point, it is also worth noting the issue of third-country health certificates. Unless I am wrong, the draft regulations will permit meat produced in EU member states and in the Channel Islands, the Isle of Man, Liechtenstein, Norway and Switzerland to be accepted without a third-country health certificate. I would be interested to know whether such a certificate will be required of those countries with which we intend to sign trade deals, because there needs to be some consistency in what we put in place with countries that we deal with as members of the EU and those with which we would normally expect some form of import and export relationship. If and when such trade deals are passed in due course, depending on what happens on 29 March, will DEFRA have a say over the third-country health certificates?
I will not rehearse the point made by my hon. Friend the Member for Edinburgh South about cost, but it would be interesting to know to what extent DEFRA has factored in the additional environmental impact and who will pay for it. Those costs will include collecting data, monitoring the effectiveness of the regulations and reporting regularly. We will lose access to the TRACES—trade control and expert system—database, which presumably we had particular access to in regard to such activities, so it would be interesting to know how far DEFRA has got in finding an alternative, running it and ensuring that it actually works.
No doubt the Minister has considered input from stakeholders, as I have. I make my usual declaration that I am an associate of the British Veterinary Association, which is reasonably happy with the draft regulations, bar the issue of certificates of competence. It is important that it be clearly spelled out how those certificates will operate, because—as I have said on numerous occasions—95% of our vets on the line in abattoirs come from outside the UK, and most of them come from within the EU. Without a vet on the line, it has to shut down. It would be interesting to know how the system will operate, at least in the short run; if we do not get it right in the short run, it will not work in the longer run. It would be useful if the Minister explained exactly how the one thing links into the other.
Luke Pollard
I have been reflecting on the Minister’s remarks about the number of people affected. I wonder whether it would be helpful for the Committee to be given the geographical breakdown of those figures, so that we know which regions of our country will be most affected by these changes and whether any of them are in the south-west, which my hon. Friend and I represent. That would help us to understand the impact on our regional economies as a result of the additional regulatory burdens for people continuing to do their job.
Dr Drew
That would certainly be very helpful. There are three abattoirs in my constituency; I could not say how many of them are personed by EU vets, but I know that that is common across the terrain, so I imagine that they are.
Compassion in World Farming sees the draft regulations as a missed opportunity. It would like the Government to go much further on tightening up pre-stunning, live exports, movements and other matters that we have discussed. It would be interesting to know by what process we will ensure that if and when we leave the EU, what we do in this country—hopefully we will at least maintain the same standards—will happen in the rest of the EU. One would not want to see any diminution of standards here, but if animals are being exported into the EU, clearly we need to ensure that standards there remain the same. It would be useful to hear from the Minister how we will continue negotiating with our colleagues—or, after March, our former colleagues—to ensure that standards do not decline anywhere. We pride ourselves on our approach to animal welfare; that is one of our arguments for not signing free trade deals with certain parts of the world.
CIWF has also looked quite hard at some of the slaughtering methods. It is not happy with the current methodology for pigs, sheep or broiler chickens, which it felt should have been tightened up. It is not necessarily about just the method of slaughter, but the mechanism behind it. I have the figures here. A recent survey by the Food Standards Agency reports that in England and Wales 86% of pigs are slaughtered with high concentrations of carbon dioxide. CIWF argues that that is incredibly environmentally damaging, and something that should gradually be run down and replaced. It will be interesting to see whether the Government have that as part of their agenda. Likewise, the non-stunning of sheep is a problem that we have never really got into, because of the normal arguments about halal and shechita methods of slaughter—sheep tend to have been left out of that.
The Royal Society for the Prevention of Cruelty to Animals is disappointed that this SI does not go further, certainly in terms of managing live exports. It has asked, what happens in terms of additional border inspections posts? I have asked the Minister that on previous occasions. We have to be aware that at the very least, as an independent nation, we will have to have more independent border inspection posts. It will be interesting to see what contingencies the Government put in place to ensure that that is the case. If the exports go through even the existing ports, such as Dover, we will need to do more checking.
The Dogs Trust—interestingly—said that it did not have time to respond, because the consultation period was so short, but it is a pretty important organisation. It is worried about the transport of adult dogs. I had not realised how many dogs get picked up, literally because the method of transport is so poor that they are seized as part of that transit. The Dogs Trust regularly rehouses adult dogs and puppies that are taken in that way. It felt that this was an opportunity to look at the way in which we transport these animals, and to raise awareness about the diseases that animals can acquire. I am told that leishmaniasis and babesiosis are both rife among puppies—something which the Dogs Trust has to deal with when rehoming those animals. What mechanisms are the Government putting in place to try to bear down on disease, when things are clearly not right at the moment?
I think this is a missed opportunity. Although SIs are coming round with such regularity that none of us knows what we are doing, but we do the best we can, there are some reasons why we should set a standard—not necessarily a gold standard—at which we can feel confident that our animal welfare is the best in the world. If we are saying that we will not diminish that, we have to be confident that it is the best in the world, so when and if we sign these wonderful trade deals, we have to set that as the standard. If other countries cannot meet those standards, we cannot sign the deals.
Carol Monaghan (Glasgow North West) (SNP)
Does the hon. Gentleman share my concern that if we reduce our standards in any way, we will potentially cut off trade with the entire European Union? Furthermore, does he agree that any delays at the border, as we have seen this week, could be hugely detrimental to animal welfare and could actually increase the incidence of disease outbreaks?
Dr Drew
I agree, and that is why I am saying that we have to ensure that our standards not only stay high, but get higher. Therefore, we will find, hopefully, that countries that we trade with will want to reach those standards.
In conclusion, this is another piece of legislation that, at one level, is nothing other than the usual cut-and-paste job. However, it covers a number of hugely controversial areas, and if we do not get this right, we will have missed an opportunity. More particularly, if we get it wrong, we will all come to rue the day when we sat in this very interesting room—not one that I have been in before, but one that is no doubt fit for purpose, as we have seen today.
David Rutley
I thank the hon. Member for Stroud for—as always—his thoughtful contributions on a number of issues, and I will do all I can to address his points. There may be one or two issues on which I will need to get back to him in writing after this meeting; I hope he will understand, given everything we are trying to deal with today.
David Rutley
Again, I will pick that up afterwards, but I understand.
The hon. Gentleman’s first question, which has come up several times, is why we are not doing more within this SI. It is important for me to say at the beginning that under the withdrawal Act, we do not have the power to make changes to the current legal regime for live exports, welfare at slaughter, journey times, and the other things we have talked about. This SI is not the place to make those changes. However, the hon. Gentleman regularly holds my feet—and those of other Ministers—to the fire on those topics, and he is aware that we have made commitments to bring about changes and are absolutely committed to moving those things forward.
The Government’s manifesto made it clear that we will take early steps to control the export of live animals for slaughter once we leave the European Union. Last year, we sought evidence on how we could achieve that, including through a possible ban. We are currently awaiting advice on that issue from the Farm Animal Welfare Committee, as well as its advice on how we can improve welfare more generally for animals in transport. That advice will be available shortly, and will address both live exports and the transport issues that the hon. Gentleman mentioned.
The hon. Gentleman raised the question of which body will authorise the slaughter certificates: the Food Standards Agency will continue to do so post exit. He also understandably raised issues about slaughter, particularly religious slaughter. He and I were both at the BVA’s annual dinner recently—at which he was a welcome guest, given his contribution to that organisation—and he will remember that at that dinner, I was clear that the Government’s long-standing position is that we would prefer to see animals stunned before they are slaughtered. We accept the right of Jewish and Muslim communities to eat meat slaughtered in accordance with their religious beliefs; however, the Government believe that consumers should have available the information necessary to make an informed choice about their food. We will consider that issue more fully, and actively work on it, once we have left the EU.
David Rutley
Clearly, we will need to assess the whole issue of food labelling more fully once we leave. The hon. Gentleman knows that we are already working on allergens, which are an important dimension. While we are in the EU, we are limited in what we can do, but when we have left, we can look at this issue in the round. This is not just about religious slaughter, although that is one key dimension, or the method of slaughter, which could include CO2 concentrations; we need to think more broadly about sustainability and the welfare standards that are involved. All of those things will be reviewed fully once we have left the EU. The hon. Gentleman raised the issue of CO2 concentrations as a method of slaughtering pigs. We are aware of that issue; we will focus on it, and trials are underway on potential alternatives, such as low atmospheric pressure stunning.
I will try to answer some of the hon. Gentleman’s more detailed questions. He asked about the geographic split of slaughterers who might be affected, prompted, I think, by the hon. Member for Plymouth, Sutton and Devonport—they were an amazing double act today. Unfortunately, at the moment, we do not have a breakdown of that concentration, but I will take a closer look at what information we might be able to provide to the hon. Member for Stroud.
Luke Pollard
I am interested in the parallel between the fees that the Minister has mentioned and the settled status application. On 21 January, the Prime Minister said:
“I can confirm today that, when we roll out the scheme in full on 30 March, the Government will waive the application fee so that there is no financial barrier for any EU nationals who wish to stay”—[Official Report, 21 January 2019; Vol. 653, c. 28.]—
unless, of course, they work in a slaughterhouse. I would be grateful if the Minister could look at whether now is the right time to waive that fee, so that there is no financial barrier to any EU citizen continuing their employment in the UK. The loss of that £225 times 200 would cost the Department about £45,000 but it would send out an important message. Will the Minister consider waiving the fee, or explain why he disagrees with the Prime Minister about financial impediments to EU nationals continuing to work here?
David Rutley
As always, the hon. Gentleman is a formidable Opposition spokesperson. He seeks to tempt me down paths. All I can say is that I completely agree with the Prime Minister. What the hon. Gentleman mentions is a broader issue about ensuring that EU nationals are welcome and that their contributions are recognised in this country. This is about a technical skill—
David Rutley
If I can finish my answer, we also need to be aware of the fact that the EU has not recognised our certificates either. We have also to bear in mind that we do not have unlimited funds with which to address such issues and that, in most cases, it would be down to the businesses involved to take on the costs. I understand the hon. Gentleman’s point, but our assessment is that it will not be an impediment for the individuals, so he cannot take too far the argument that I am at odds with the Prime Minister—that is a step too far, even though he tempts me down that path.
I think I have addressed most of the other issues that have been raised. As for border inspection posts and the RSPCA’s concerns, they are commercial entities and we are working with commercial bodies to determine what the future requirements might be. The hon. Member for Stroud made an important point about adult dogs, which I will pick up separately as I do not have all the answers. I think he knows, because we share a commitment to doing all we can to tackle illegal puppy smuggling and its disease and welfare implications—not just for the dogs but for humans—that we will make that a priority.
I hope I have answered most of the questions to the satisfaction of members of the Committee. I reiterate that the regulations will not amend current welfare standards but will make operability changes to ensure that existing EU law works appropriately once we leave the EU. I also wish to make it clear that the Government have no intention of reducing animal welfare standards; in fact, we will look to strengthen them, over time, in light of evidence. For the reasons I have set out, I commend the statutory instrument to the Committee.
Question put and agreed to.
Resolved,
That the Committee has considered the draft Animal Welfare (Amendment) (EU Exit) Regulations 2019.
Draft Challenges to Validity of EU Instruments (EU Exit) Regulations 2019
(5 years, 8 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State for Exiting the European Union (Chris Heaton-Harris)
I beg to move,
That the Committee has considered the draft Challenges to Validity of EU Instruments (EU Exit) Regulations 2019.
It is a pleasure to serve under your chairmanship, Mr Davies; I believe this is a first for me as a Minister. I am slightly reticent as to any rulings that you might make. We have interesting times when people are in the Chair in this place at the moment.
The draft instrument is now the third that I have had the pleasure of debating under the affirmative procedure. A motion to consider the same regulations was passed in the other place just last week. The draft regulations are part of the Government’s wider programme of secondary legislation to ensure that the UK’s legal system continues to function effectively when we leave the European Union. They will take effect on exit day, or, if an implementation period is agreed, at the end of that period.
The overall intention behind the draft regulations is to make sure that validity challenges that originate in our domestic courts before exit can continue to be heard after exit. They will do that by making provision for UK judges to have jurisdiction to hear those cases. At present, they do not have that jurisdiction; only Court of Justice of the European Union judges have the right to deliver judgments on validity. Questions of validity arising in domestic courts must be referred to the CJEU for judgment.
The draft regulations mean that domestic judges will not be dependent on the judgments of CJEU judges to make rulings in domestic cases. Domestic judges will be empowered to make rulings independently of the CJEU, using the same grounds as are currently set out in article 263 of the treaty on the functioning of the European Union: a lack of competence; infringement of essential procedural requirements; infringement of the treaties or of any rule of law relating to their application; or a misuse of powers. I bring to Members’ attention that the number of validity challenge cases referred by UK courts to the CJEU is extremely small. Over the last five years, only 12 cases have been referred by the UK courts, and only one has been partially successful.
As I mentioned, the intention behind the draft regulations is to ensure that access to justice is not restricted after exit. Without the draft regulations, the effect of the European Union (Withdrawal) Act 2018 would be that pending cases for which references have already been submitted to the CJEU would not be able to continue. Indeed, whether the CJEU will continue to rule on validity cases submitted by the United Kingdom remains uncertain. The draft regulations will make sure that these pending cases can continue. At the last count, there were only three such cases.
Vernon Coaker (Gedling) (Lab)
It would be interesting for the Committee to know what those three cases are. Will the Minister go on to them?
Chris Heaton-Harris
I will happily go on to those cases. They are three basic tax cases: C-182/19, brought by Pfizer Consumer Healthcare, concerning the tax classification of certain therapeutic bandages; C-677/18, brought by Amoena, concerning a tax classification for accessories for artificial body parts—actually, mastectomy bras; and C-612/16, brought by C & J Clark International, concerning the anti-dumping duty and the import of certain leather footwear originating in the People’s Republic of China and in Vietnam. That last one was actually nearly a constituency case of mine. I hope that that helps the hon. Gentleman.
As I said, the intention behind the draft regulations is to ensure that access to justice is not restricted after exit. Without the draft regulations, the effect of the EU withdrawal Act would be that pending cases for which references have already been submitted to the CJEU could not continue. I have said that it remains uncertain whether the CJEU will continue to rule on validity cases submitted by the United Kingdom.
The regulations also cover cases where a domestic court has not yet made a reference to the CJEU but was planning to do so, and any case, other than cases begun before exit, in which a validity challenge may arise. That means that where claimants have brought a case before exit day that hinges on the validity of an EU law, there will be a mechanism in place to ensure that rulings on validity can be provided domestically. The regulations provide that where domestic judges find that an EU law was made invalidly, they will have the jurisdiction to declare it void. The effect of a declaration of invalidity will be that the law is not valid for the purposes of migrating to the UK statute book—in effect, there was never a retained EU law version of it.
I highlight to hon. Members the fact that my Department has worked closely with the Ministry of Justice in developing these regulations. In particular, officials from my Department have worked with judicial policy officials to ensure that both judges and Her Majesty’s Courts and Tribunals Service are aware of these changes and can manage any change in workload accordingly. Given the historical number of cases that I referred to earlier, my officials expect there to be a very limited number of potential cases aside from the three currently pending, which I have just talked about.
There are two final elements to the regulations that I would like to touch on. Regulation 5 stipulates that the courts must give the appropriate UK authorities notification of their intention to declare an EU law void, and regulation 6 stipulates that any UK authorities have the right to be joined as a party to any proceedings in which these regulations apply. In these regulations, “the relevant UK authorities” is defined as
“a Minister of the Crown (or a person nominated by him), the Scottish Ministers, a Northern Ireland department, and the Welsh Ministers”.
The effect of regulation 5, therefore, is that UK Government Ministers and all the devolved Administrations must be informed when a court is planning to issue a declaration of invalidity.
That particular requirement of the regulations was suggested by the Scottish Government following consultation with them on our proposals. Although the laying of this statutory instrument did not require formal consent from the devolved Administrations, my officials and I were keen to ensure that they were given ample opportunity to provide their views. As I said, as a direct result of this engagement we considered it appropriate that all the devolved Administrations, not just the Scottish Government, be given the right to be notified and be joined as a party to a legal case, given that EU law can directly relate to their respective devolved legal competences.
I have of course thanked the devolved Administrations for their extremely helpful input and received letters from both the Welsh and Scottish Ministers responsible for EU exit, testifying that they are content with these regulations. I would be more than happy to elaborate on any aspect of the regulation that the Committee might find useful. I hope that all members of the Committee will agree that the draft regulations are necessary and important to ensure that courts in the UK can continue to administer justice effectively once we leave the European Union.
Paul Blomfield (Sheffield Central) (Lab)
If I may echo the Minister, it is a pleasure to speak to this statutory instrument with you in the Chair, Mr Davies. I thank the Minister for his detailed explanation of the instrument and his comprehensive response to the question asked by my hon. Friend the Member for Gedling.
Schedule 1, from which this statutory instrument flows, relates to section 6 of the EU withdrawal Act on the interpretation of retained EU law. The relationship between domestic law, EU retained law and EU law post exit will give rise to many legal complexities and this SI, though narrow in its scope, raises serious technical and constitutional questions that require clarification.
The Minister did not take the EU withdrawal Act through the Commons, but I am sure he paid close attention, and he will know that when we originally debated it over several long months there was no clarification of schedule 1 paragraph 1(2)(b), which exempted the ban on validity challenges where,
“the challenge is of a kind described, or provided for, in regulations made by a Minister of the Crown.”
This SI provides the necessary criteria, as the Minister set out, and we do not intend to divide the Committee on it.
There is a point on which I seek clarification from the Minister, and that is the decision not to provide a mechanism for the domestic courts to take into consideration future declarations of invalidity by the Court of Justice of the European Union and the potential impact on UK citizens or businesses. The justification for that, as set out by the Minister and in the explanatory memorandum, raises several questions and risks creating an ambiguous legal position. The concern was also expressed in the other place and by the House of Lords Constitution Committee. Paragraph 2.7 of the explanatory memorandum refers to the fact that
“domestic courts have never been able to find EU law invalid.”
That is true, but we are dealing with a new category of EU retained law that will require an innovative approach, as reflected in the fact that the SI gives domestic courts a time-limited power to rule on the validity of EU law.
Paragraph 2.9 of the explanatory memorandum asserts that the approach in the 2018 Act was
“to take a snapshot of EU law as it stands on exit day.”
I recognise that the Government believe that that will provide legal certainty, but I am concerned that it does not robustly tackle the complex questions that the provision raises. We believed that our post-Brexit relationship with the CJEU should be much more dynamic and we tabled amendments to that effect in our consideration of the Bill. However, we recognise that there was some acknowledgement that the influence of the CJEU could not be exorcised from EU retained law, and it seemed that the Government had some appreciation of that.
Section 6(2) of the 2018 Act permits domestic courts to take account of CJEU judgments post exit, but not be bound by them. That is a sensible approach that reflects the unique new category of law created by our departure. However, it is negated by section 6(3), which limits any questions on validity in accordance with retained pre-exit case law and pre-exit EU competencies. The Government’s justification for that in the SI relies heavily on their belief that it will affect a small number of litigants. The Minister made the point that cases are extremely rare. If the Government believe the cases are so few in number, would it not be more consistent and arguably provide more legal certainty to permit domestic courts to have regard to post-exit questions on validity? I recognise that the Minister is arguing that that creates uncertainty, but that is at odds with his argument about the rarity of the cases. We cannot predict that, and the relationship between retained EU law and other domestic legislation is likely to raise a host of questions for the courts.
The instrument risks denying courts what might be much-needed flexibility in dealing with the new relationship. Let us take one example. Paragraph 2.4 of the explanatory memorandum recognises that a declaration of invalidity by the CJEU leads to a disapplication of the legislation, which
“is as if the law in question never existed.”
Have the Government given any consideration to a legal challenge that there was no valid underlying EU law to be transposed into domestic law, therefore meaning it does not exist in EU retained law? This is not a question of parliamentary sovereignty, as per paragraph 2.9, which states that it would be
“for Parliament to decide whether and how to diverge.”
Rather, it is a case of whether that snapshot, as the Government deem it to be, was itself inaccurate. I would appreciate clarification from the Minister on that point.
Mr Richard Bacon (South Norfolk) (Con)
It is a pleasure to serve under your chairmanship, Mr Davies. I have a couple of quick questions for the Minister. I completely understand the Government’s desire to achieve legal certainty, which is, as he himself said, the purpose of the regulations.
Paragraph 2.1 of the explanatory memorandum clearly states:
“On exit day, the EU Withdrawal Act makes clear that there will be no right in domestic law on or after exit day to challenge any retained EU law on the basis that, immediately before exit day, an EU instrument was invalid.”
Is that designed to oust a challenge on any other grounds? It sounds suspiciously like an ouster clause. The Minister will know from history that the courts in this country are reluctant to entertain Governments’ attempts to remove the purview of the courts entirely, and it does sound as if that is exactly what the provision is trying to do. For example, the grounds that the Minister gave include a lack of competence, an infringement of an essential procedural requirement or a misuse of powers.
If an applicant brought before a UK court after exit day an application in relation to a piece of EU law that had been completely transferred—not an application pending in the way that is described here, but rather one that only started after exit day—and the removal of the purview of the CJEU had taken effect, and the application related, for example, to a breach of the rules of natural justice, which a court would certainly wish to entertain, or to a Minister misinforming himself as to his powers, including on an EU law that had been transferred to the UK statute book and had not been challenged hitherto, or in relation to any infringement of procedural requirements, which I suppose would include the rules of natural justice, what would be the Government’s attitude to such an application? Are the Government trying to say that the courts could not entertain such an application? I hope not, and the Minister is shaking his head.
Secondly and finally, if there were a case where a court found itself saying, “This is an instance where we would recognise the validity of the applicant’s claims if we could, but thanks to this regulation we can’t, so we won’t”, what would then be the Government’s policy?
Vernon Coaker
I think I agree with the hon. Gentleman regarding the questions that he has just asked.
I will say this again, and I say it in every SI Committee that I am on: there are numerous SIs that pass into law that have huge implications and people come to our surgeries and say, “When did this happen?” It usually turns out that it was under some SI, rather than a piece of legislation discussed in the main Chamber.
I am not a lawyer, but I will pick up on one or two things that the hon. Member for South Norfolk asked about. The Minister may say, “I have already answered this”, but for the benefit of those who might read these proceedings and non-lawyers, it would be helpful for us to understand better.
I take the point that the Minister made, when he very helpfully read out the court case numbers, which I failed to write down; I did write down the topics. But this is the point: those cases will be dealt with, because they have already begun. I understand that, because these cases were already entered into by the courts beforehand, so there will be an opportunity for our courts to make a judgment on them after exit day—should that happen.
I have no idea what challenges there are around therapeutic bandages or artificial body parts or anti-dumping duties on footwear from China, but I would hesitate to say that these issues are irrelevant or of no consequence, partly because in numerous SI Committees seemingly impenetrable things happen and impenetrable regulations are passed, and then sooner or later somebody comes to one of our surgeries and says, “You’ll never guess what: I have a footwear business and I do a lot of trade with China, and something has happened so that it’s been declared invalid and I can’t now do it.” I have no idea. I am not saying it is wrong or right; I just do not know.
However, I have a couple of questions and it would be helpful if the Minister could answer them. I ask the Minister’s pardon if this is obvious, but it is not obvious to me: is this a no-deal SI, or is it just an SI that is passed whatever the consequence or outcome, whether we leave with a deal or no deal? Is this in lieu of a no-deal Brexit?
Normally, under our constitution, the courts can interpret the law, but as I understand it this measure will allow the courts to strike a law down. So what part of our constitution is the Minister saying allows us to strike down a law? Can he more properly explain the operation of retained European law after exit? I thought it was just, “This is the law, these are the laws we don’t want, these are the laws we do want, so they become part of our law—full stop.” Now, if I am not a lawyer, somebody needs to explain what “retained” means, because what I have just said is what I would have assumed it meant.
Mr Bacon
That is my understanding as well—that retained EU law simply becomes part of domestic law. My questions to the Minister were around the case of something that—in these terms and for these purposes now, after exit day—would no longer be termed in retained EU law but simply for these purposes domestic law, and whether, as this purports to suggest, it would oust the ability of an applicant to get a court to entertain whether this was in breach, or whether the powers that the Minister was using, or purporting to use, under that—for these purposes—domestic law were wrong and invalid, and the Minister was acting inappropriately.
Vernon Coaker
I agree with that. It is very well put and is a question for the Minister to answer, because it goes to the heart of what we are asking.
My final point in this brief contribution is important. What happens if the CJEU—I need to be careful here or I will confuse myself—finds a pre-exit provision of EU law to be invalid? It will cease to be EU law, but will it continue here? The CJEU will have found an existing piece of EU law, which, presumably, we have retained, invalid, so it will not operate in the rest of Europe, but, because it is retained, we will not have the opportunity—or will we?—to strike it down. Or will it simply continue here, even though it has been struck down in the rest of the EU, if the Minister understands me?
Vernon Coaker
I think that is a really important question. On this invalidity in one part of the EU versus validity, the Committee, and certainly the people who read our proceedings, would find it helpful if the Minister explained that in non-legalistic terms so that people like me, if not anybody else, could more properly understand it.
Nobody has ever discussed this with me, and I have no idea whether anybody will, but I just know that, even though there are only three or four or maybe five or six cases, if a case turns up in one of our constituencies it becomes a very big deal. I do not want to be in a position—neither does anybody on the Committee—where somebody says, “Did nobody ask what this meant in terms of validity of EU law and retained law, or who could strike it down, or what the role of our courts was?” The Minister remarked on this, as did my hon. Friend the Member for Sheffield Central from our Front Bench, but a couple of answers to the questions posed by the hon. Member for South Norfolk and me would be helpful to our deliberations.
Chris Heaton-Harris
I thank the various members of the Committee and the shadow spokesman for their points, questions and contributions. I attempted in my opening speech to be relatively brief. Unfortunately, some of the questions raised are relatively complicated, so I am afraid my concluding remarks might take slightly longer.
I will go through some of the points raised. To give an example, one case that I mentioned was partially successful, and I should go into more detail so that people can understand exactly what sorts of case have been subject to validity changes in the past. The one that was partially successful was a tax case submitted by the first-tier tax tribunal. The case concerned the validity of regulations imposing anti-dumping duties on shoes containing specific leather parts. The hon. Member for Gedling is completely correct: such cases are very particular to certain Members of Parliament. I come from Northamptonshire. Shoe manufacturing is a big deal in my part of the world and the case was a big local news story at the time. The CJEU found that, although parts of the regulations were invalid, the parts imposing the anti-dumping duties were still valid, which is why the ruling was partial.
The claimant in the case, Clarks the shoemaker, a manufacturer, claimed that the EU had committed an infringement of an essential procurement requirement on the basis that the Commission had not adjudicated upon claims for market economy treatment and individual treatment by certain Chinese and Vietnamese exporting producers. The claimant argued, therefore, that the regulations imposing anti-dumping duties on specific footwear containing uppers—which, as members of the Committee will know, are the parts of the shoe that cover the toes, the top of the foot, the sides of the foot and the back of the heel—made from leather, and originating from Vietnam, China and Macao, were invalid.
The CJEU found that two EU regulations were partially invalid, but that specific requirements of regulations imposing the anti-dumping duties were still valid. In other words, the hon. Gentleman is quite correct. Although it is easy to brush over the effects of the judgments in a couple of sentences in Committee, they are quite significant judgments for big manufacturing companies across our constituencies. He and my hon. Friend the Member for South Norfolk were right to raise the questions that they did.
The first question is, does the measure reduce access to justice in certain ways? No, it does not. It allows cases begun before exit to continue largely as at present. Without regulations, it would not be possible to continue a validity challenge begun before exit. The decision that it will not be possible to challenge the law on the basis of validity after exit was taken and voted upon by Parliament when the EU withdrawal Act passed.
Another question was, what will happen if the CJEU rules after exit that EU legislation was invalidly made? Will that invalid legislation remain on the UK statute book? The answer is yes—decisions by the CJEU will not affect retained European law. The hon. Member for Gedling asked what EU retained law is. It is a snapshot of all European law taken the day we leave the European Union. It is being done by the National Archives, and will be accessible to every person in this country. I have been to visit the programme that is doing this. I promise the Committee that not only is it on budget, on time and able to do its job; it is ready to go now. There will therefore be a body of retained EU law that people can interrogate from their homes, should they wish to do so.
Even if the CJEU decides to void legislation after exit day, that law will remain on the UK statute book as retained EU law, because the European Union (Withdrawal) Act will take a snapshot of EU law as it stands on exit day, and all law on the UK statute book at that time will be valid as a result of its being made law under the Act. After exit, it will be for Parliament to decide whether and how to diverge from EU law, or indeed perhaps to take note of what might have happened at the CJEU, and to take action that flows from that.
Another question—raised, I think, by the hon. Member for Sheffield Central—was, why do the regulations not go further and include provision for future rulings of the CJEU to be taken into account, or provision for there to be consideration of future rulings? The decision to extinguish validity challenges domestically is coherent with the Government’s intention to re-establish UK parliamentary supremacy over UK law after exit. After exit day, it should and will be for Parliament to decide how, when and whether the UK should modify retained EU law.
Mr Bacon
The Minister is being very clear and has, to some extent, put my mind at rest. I have no issue with the idea that our domestic courts cannot challenge the validity of EU retained law—for these purposes, domestic law. In any case, an ability on their part to do that would seem to me to be a dodgy and suspicious foreign import to English jurisprudence, so I have no problem with that at all. I suppose what I am really trying to get at is simply whether I am correct in supposing that the SI does not purport in any way to limit at all the ambit of the judicial review of administrative action of any law, including the law to be imported as EU retained law into domestic law.
Chris Heaton-Harris
I can absolutely give my hon. Friend that assurance.
Returning to why the regulations do not go further, the statutory instrument could not act in contradiction to the explicit intention of the withdrawal Act. It could not, for example, make provisions so that UK judges followed validity rulings of the CJEU, or so that future rulings of the CJEU on validity would mean that retained EU law was invalid.
I hope that I have answered a couple of the questions. I am wary in that I might not have tackled everybody’s questions, so, as I begin to conclude, if I have missed anybody I would very much appreciate it if they let me know. My hon. Friend the Member for South Norfolk talked about an ouster clause. We have copied the CJEU grounds, and cannot currently challenge validity for any other reason. I hope that he is now completely satisfied on those grounds.
The regulations aim to ensure the effective continued delivery of justice as we leave the European Union. As such, they are an important part of the Government’s preparations for the UK’s withdrawal from the European Union. As such, I commend them to the Committee.
Question put and agreed to.
Resolved,
That the Committee has considered the draft Challenges to Validity of EU Instruments (EU Exit) Regulations 2019.
Draft Financial Services (Miscellaneous) (Amendment) (EU Exit) Regulations 2019
(5 years, 8 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Economic Secretary to the Treasury (John Glen)
I beg to move,
That the Committee has considered the draft Financial Services (Miscellaneous) (Amendment) (EU Exit) Regulations 2019.
May I say what a pleasure it is to serve under your chairmanship, Mr Bailey? As the Committee will be aware, the Treasury has been undertaking a programme of legislation to ensure that, if the UK leaves the EU without a deal or an implementation period, there continues to be a functioning legislative and regulatory regime for financial services in the UK. The Treasury has been laying statutory instruments under the EU (Withdrawal) Act 2018 to deliver that, and most of them have now been debated and approved and are in place for exit day should they be needed. The SI being debated today is one of the final parts of the programme. I believe it is the 51st SI and the 31st debate in which I have taken part.
The instrument revokes a number of pieces of UK domestic law and retained EU law that it would not be appropriate to keep on the statute book after exit. It also makes amendments to a number of financial services EU exit SIs to reflect other instruments that have been laid as part of the wider legislative programme, corrects minor errors identified in legislation after making and makes amendments to ensure consistency between EU exit instruments.
Turning to the substance of the SI, it has five main components. First, the SI amends UK domestic law to ensure continuity with other legislation that has been amended under the 2018 Act. Specifically, it makes amendments to primary and secondary legislation that does not fall within the remit of changes made by other instruments. Specifically, the SI removes references to EU institutions and regimes in four Acts of Parliament: the Insolvency Act 1986, the Financial Services and Markets Act 2000, the Income Tax Act 2007 and the Corporation Tax Act 2009. The amendments will ensure that provisions that are irrelevant in a UK-only context are not retained on the UK statute book. The SI also makes minor technical amendments to seven pieces of secondary legislation to reflect changes made by other legislation. For example, it updates the definition of “credit institution” as introduced by the Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019.
Secondly, the SI makes minor technical amendments to 12 other financial services EU exit instruments that have been previously debated by the House. A number of the amendments are being made in this instrument because they are consequential on other instruments that have only recently been made, such as the Equivalence Determinations for Financial Services and Miscellaneous Provisions (Amendment etc) (EU Exit) Regulations 2019. A minority of the amendments correct drafting errors and improve the clarity of drafting. For example, a duplicate provision is omitted from the Bank of England (Amendment) (EU Exit) Regulations 2018, as the same amendment is made by the Deposit Guarantee Scheme and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018.
At this point, it would be appropriate for me to acknowledge the enormous amount of work done by my colleagues in the Treasury to minimise the number of amendments that have been necessary. We are talking about 10 or 12 in 1,000 pages of SIs.
Thirdly, the SI revokes three UK statutory instruments that relate to EU regimes that will not be applicable to the UK in the event of a no-deal exit, given that they implement EU law that is being revoked at exit day under separate instruments.
Fourthly, the SI makes amendments to or revokes retained EU law to ensure consistency with other EU exit instruments that have been made and to remove references to EU institutions that will no longer be relevant post-exit. For example, part of regulation 33 revokes EU regulations providing for functions and administration of the European Central Bank.
Finally, the SI makes transitional and saving provisions to address deficiencies that arise from the UK’s withdrawal from the EU and to limit disruption to the financial services industry if the UK leaves without a deal. For example, a minor change is made to article 7 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, which excludes deposits held in lawyers’ client accounts from being regulated under financial services law, as they are already regulated by the Law Society. European-registered lawyers are currently included in the exemption, and the SI ensures that the exemption will continue for a limited period after Brexit. A transitional regime is also made for group supervision under the Solvency 2 and Insurance (Amendment, etc.) (EU Exit) Regulations 2019, so that where a group is supervised by an EEA supervisor, the relevant provisions that impose requirements on the Prudential Regulation Authority as a group supervisor do not apply for a period of two years after exit day.
The Treasury has worked closely with the financial services regulators in the drafting of the EU exit instruments amended by the instrument. We have also engaged extensively with the financial services industry on the instruments to which the SI relates. In summary, the Government believe that the proposed legislation is necessary to ensure that the UK has a coherent and functioning financial services regulatory regime once it leaves the EU, and that the legislation will continue to function appropriately if it leaves the EU without a deal or an implementation period. I hope hon. Members will join me in supporting the regulations, which I commend to the Committee.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
It is always a pleasure to serve under your chairmanship, Mr Bailey. Once again, the Minister and I are discussing a statutory instrument that makes provision for a regulatory framework after Brexit in the event of us crashing out without a deal. On each occasion, my Front-Bench colleagues and I have spelt out our objections to the Government’s approach of using secondary legislation to fulfil that process.
As the Minister has said, we are reaching the end of the process or, as Churchill might have said, the end of the beginning. This is one of the last few statutory instrument Committees that I will address before we perhaps leave the European Union at the end of the month. We have had some 25 or 26 debates—my hon. Friend the Member for Oxford East (Anneliese Dodds) has shared the burden with me. I place on record my thanks to my staff, particularly Sophia Morrell in my office and Mary Partington in the shadow Chancellor’s office, for their assistance with the process. It has been technical and burdensome, so the support of dedicated staff has been essential. I also thank my hon. Friends the Members for Manchester, Withington and for Colne Valley for their support and attendance.
It has been a long process for us all, including the Minister and his staff. It is a source of some frustration that the Government held a vote to prevent us crashing out only last week—we wanted that to happen many months ago. Technically, we are debating secondary legislation that the Government have stated that they will never allow to be needed, but these are not normal times. I also note that we have not received a new date for the Financial Services (Implementation of Legislation) Bill to return to the Commons. Will the Minister tell us whether there is any plan for it to return?
The statutory instrument demonstrates the scope of what the Government have attempted to carry out in the process. The pressure of scrutiny has been immense and, at this late stage, we seem to have been presented, in a way that is difficult to analyse, with a substantial wrap-up item that contains dozens of individual changes to previous statutory instruments. The Minister has shed some light on the source of the amendments and has been candid in saying that some reflect deficiencies in the original instruments that we have passed, but they are similar in scope to the Financial Services (Implementation of Legislation) Bill and go to the core of our critique of the process.
Surprisingly, I note from the explanatory memorandum that the SI was originally tabled as a negative instrument. That decision was subsequently declined by the European Statutory Instruments Committee, or sifting Committee, hence our debate under the affirmative procedure today. I am minded to vote against it for that reason, on principle, but if the Minister agrees, a better way forward might be for him to write to me to set out, in his view, the balance between the drafting errors and the technical amendments contained in the instrument, and to place a copy in the Library so there will be complete transparency for all hon. Members as to exactly what it contains and relates to.
The Chair
In the absence of other hon. Members queuing up to contribute, I call the Minister to reply.
John Glen
I thank the hon. Member for Stalybridge and Hyde for his comments. I acknowledge the courteous and thorough way in which he has gone about his work. Where there have been differences between us, he has raised them in the spirit of constructive scrutiny, and he has worked extremely hard with his team. As someone who was responsible for supporting the shadow Chancellor in a previous era, I know how challenging it is to do that sort of work, so I pay tribute to his office and those who have supported him. I will thank my hon. Friends at a later point, because I still have more to do.
The hon. Gentleman raises significant and substantive points. I cannot assist him with respect to the timing of the Financial Services (Implementation of Legislation) Bill. I acknowledge that the Bill is outstanding, but at this point in time I am not in a position to give him the information he seeks.
The hon. Gentleman referred to the move from negative to affirmative process. I undertake to write to him about that. My understanding is that it was moved in that direction because of the sheer volume of small amendments. I reassure him that it was always envisaged when this process was designed, and when I saw that spreadsheet back in October, that there would be mop-up measures given the nature of the complexity of the exercise.
I reassure the hon. Gentleman that there have been no meaningful policy changes through this SI. These are technical changes, often to remove reference to the EU, and the drafting errors are a significant minority. Nevertheless, I will reflect fully on his comments and where I can offer him some more substantive words of reassurance I will do so.
Having given that response, I hope that the comments I made on the necessity for this SI in ensuring a functioning and coherent legislative and regulatory regime for financial services have been heard. I commend this regulation to the Committee.
Question put and agreed to.
Draft Aviation Noise (Amendment) (EU Exit) Regulations 2019
Draft Aviation Statistics (Amendment ETC.) (EU Exit) Regulations 2019
Draft Aviation Safety (Amendment Etc.) (EU Exit) Regulations 2019
(5 years, 8 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister of State, Department for Transport (Jesse Norman)
I beg to move,
That the Committee has considered the draft Aviation Noise (Amendment) (EU Exit) Regulations 2019.
The Chair
With this it will be convenient to consider the draft Aviation Statistics (Amendment etc.) (EU Exit) Regulations 2019 and the draft Aviation Safety (Amendment etc.) (EU Exit) Regulations 2019.
Jesse Norman
It is a pleasure to serve under your chairmanship, Mr Gray. The draft instruments that we are considering will be made under the powers conferred by the European Union (Withdrawal) Act 2018 and will be needed if the UK leaves the European Union without a deal. The Government’s priority is still to leave the European Union with a deal, but of course we must make all reasonable plans to prepare for a no-deal scenario, and that includes ensuring that there is a functioning statute book for aviation.
The first draft instrument, on aviation noise, makes amendments to domestic legislation and a directly applicable EU regulation that relate to aviation noise certification and the circumstances in which operating restrictions are considered at airports. The relevant regulations are, first, the Aeroplane Noise Regulations 1999, which were made to implement in UK law EU obligations relating to noise certification requirements in respect of propeller-driven and civil subsonic jet aeroplanes. The noise regulations prohibit certain aircraft from taking off or landing in the UK without having an in-force noise certificate issued by the UK or a competent authority of the state of registry that is recognised by the UK.
Secondly, the Air Navigation (Environmental Standards For Non-EASA Aircraft) Order 2008, also known as the environmental standards order, sets out the environmental standards relating to the noise and emissions of specific UK-registered aircraft that are not subject to the basic EU aviation safety regulation—EU regulation 2018/1139—and regulation by the European Union Aviation Safety Agency. Those regulations apply largely to light and microlight aircraft.
Thirdly, EU regulation 598/2014, commonly known as regulation 598, establishes the rules and procedures with regard to the introduction of operating restrictions at certain EU airports, based on a balanced approach to noise management, which has been an agreed International Civil Aviation Organisation principle since 2001. Finally, the Airports (Noise-related Operating Restrictions) (England and Wales) Regulations 2018, otherwise known as the operating restrictions regulations, appointed competent authorities for England and Wales for the purposes of regulation 598. The withdrawal Act will retain EU regulation 598 in its entirety, on exit day, in UK law.
The draft instrument makes the necessary changes to the noise regulations, the environmental standards order and the operating restrictions regulations to ensure that the legislative framework continues to function correctly after exit day. The noise regulations are being amended so that in the UK the same noise certification requirements apply to aeroplanes registered in a European economic area state which apply to other foreign-registered aeroplanes. That will in effect end the automatic recognition of noise certificates granted in the EU and EEA. Rather than the UK automatically recognising noise certificates granted in the EU and EEA, noise certificates from the EU and EEA will be subject to the same rules that currently apply to noise certification of aircraft from non-EU and non-EEA countries. The requirements relating to certification of UK-registered aeroplanes are being amended so that they apply only to use in the UK rather than use in the EU and EEA. The regulations apply to propeller-driven and civil subsonic jet aeroplanes. That includes light aircraft and commercial passenger aircraft.
Criminal offences for breach of the noise regulations have existed in domestic legislation since 1999 and carry a penalty of up to £2,500. Those offences already apply to third-country operators and to operators of UK-registered aircraft operating in the EU, but not to certain smaller civil subsonic jet aeroplanes registered in an EU member state, EEA state, Gibraltar or Switzerland. The amendments to the noise regulations that I have described mean that from exit day the aircraft will be covered by the offences for breaching the noise regulations.
The changes to the environmental standards order amend the terminology used in the order so that it is aligned with changes made to aviation safety legislation on EU exit. For example, the instrument removes references to EASA. The amendments to regulation 598 provide for obligations conferred on member states under the regulation to be conferred instead directly on the Secretary of State and, where appropriate, on the Northern Ireland Department for Infrastructure or on Scottish Ministers. It includes an obligation on competent authorities to inform the Commission and other member states that operating restrictions are planned to be imposed.
The instrument instead provides for a UK-based relevant authority to be notified in place of the Commission. It also places an obligation on the relevant authority instead of the member state to ensure a right of appeal. The Commission’s power to adopt delegated measures providing for technical updates to the regulation to take account of changes in relevant international rules is conferred instead as a power for the Secretary of State to make regulations subject to the negative resolution procedure. The changes to the operating restrictions regulations reflects a very small amendment to the title to regulation 598 made by the instrument and removes the word “Union”.
When the instrument was debated in Grand Committee in the House of Lords last week, the issues of consultation and independence of competent authorities were raised. As the aviation Minister, Baroness Sugg, said during that debate, the instrument itself does not appoint the competent authorities. That was done last year for England and Wales following extensive consultation. An instrument was laid on 5 March appointing competent authorities for Scotland. It is a requirement under regulation 598 that the competent authorities are independent of any organisation that could be affected by noise-related action. There is a requirement for right of appeal. It is also a requirement under regulation 598 that stakeholders are consulted before any operating restrictions are imposed. That remains unchanged.
The draft aviation statistics instrument amends EU regulations 437/2003 and 1358/2003, and seeks to maintain the status quo with regard to the provision of data by operators of airports served by commercial flights. This is achieved by making technical changes to ensure that retained legislation continues to function, including amending redundant references to the UK being a member state. A further part of the instrument made under the European Communities Act 1972 creates a mechanism to enforce the obligation on airports to provide data, because there is currently no penalty if an airport does not comply.
The SI was initially laid as a proposed negative instrument, but we have accepted the recommendations of the Secondary Legislation Scrutiny Committee to re-lay the SI using the affirmative procedure instead, acknowledging its concerns about the potential impact of the changes on commercial airport operators. I thank the Committees for their work in considering the statutory instrument.
EU regulation 437/2003, referred to as the statistical returns regulation, requires operators of airports served by commercial flights to provide their member state with specified statistical data. In its existing form it specifies information that must be compiled by the member state: in this case, a function carried out by the Civil Aviation Authority. It also requires that the same information must be provided to the European Commission’s statistical office, Eurostat. It further sets in place standards that must be met during the compilation and submission processes.
EU regulation 1358/2003, referred to as the implementing regulation, requires that the process set out in the statistical returns regulation is applied to a set list of airports and updates the list of statistical information that said airports must supply. The list of airports comprises effectively all that see commercial air traffic. The list included 46 airports across the UK at the point of its last update by the EU.
The withdrawal Act will retain EU regulations 437/2003 and 1358/2003 in their entirety on exit day in UK law. The draft instrument that we are considering makes the changes necessary so that those EU regulations continue to function correctly after exit day. It is essential to ensure that the regulatory regime in place after exit continues to allow statistics on the total volumes of passengers and freight using UK airports to be compiled. The gathering of such data and publication of derived figures by the Civil Aviation Authority are activities that are important for Government, the public and the sector itself to be able to monitor performance. Further, the draft instrument amends the statistical returns regulation to remove the duty on the UK to continue to transmit the data to Eurostat. The power to collect statistical data and the obligation on respondents to provide that data are to be retained, with responsibility for the functions being given to the CAA.
The instrument amends the implementing regulation to remove the specific list of airports covered. The list is, in fact, superfluous, as the existing implementing regulation contains a mechanism that sets the burden of data collection at different levels, depending on the volume of traffic seen by an individual airport. The mechanism will remain in the retained EU regulations, so what is expected of airports will stay the same.
The data-collection power provided is an important tool for accessing data, due to the competitive and commercially sensitive nature of the sector. As such, it is important that the legislation continues to operate after the UK has left the EU, and the amendments to the retained EU legislation are essential if that is to be achieved.
During the preparation of the instrument, a review of the statistical returns regulation highlighted the requirement for an enforcement mechanism, to meet the UK’s responsibility as a member state. That is why the Secondary Legislation Scrutiny Committee recommended that the instrument be upgraded to the affirmative procedure. The instrument therefore provides a mechanism whereby the CAA can enforce the obligation on airports to provide the data specified in the statistical returns regulation. In determining the penalty, enforcement mechanisms in similar legislation were considered, so as not to go beyond prior precedent. Consequently, the Department decided to match the enforcement power in the Airport Charges Regulations 2011, with a civil penalty of up to £5,000. That part of the regulations is required regardless of final decisions on the UK’s future relationship with the EU.
Hon. Members may recall that the draft aviation safety instrument was debated in a Delegated Legislation Committee on 19 December 2018. Since then, a new EU regulation was published on 10 January and entered into force on 30 January. That regulation amends a small number of provisions relating to the medical assessment of pilots that were already being corrected by the draft instrument. As a consequence, a few aspects of regulation 318 in the original draft instrument would no longer accurately correct retained EU legislation, as the EU legislation they acted upon would have changed. In particular, the inaccurate aspects of regulation 318, on the medical assessment of pilots, would have been outside the powers of section 8 of the EU withdrawal Act, under which the draft instrument has been made—in other words, ultra vires.
To ensure that the entirety of the draft instrument made proper and correct use of the powers in the EU withdrawal Act, the Government made the decision to withdraw it, correct it and re-lay it at the earliest opportunity. The version of the instrument we are considering today also takes account, therefore, of the new EU regulation, the resulting changes to regulation 318 in this instrument and the minor addition required to regulation 327. The rest of the instrument remains unchanged.
The current instrument corrects five principal EU regulations relating to aviation safety, together with a number of Commission implementing regulations made under them. The five principal EU regulations include regulation 2018/1139, more commonly known as the EASA basic regulation, and regulation 3922/91 on technical harmonisation. Although the latter has been largely superseded by the former, provisions on flight and duty time limitations still apply to the crews of aeroplanes undertaking air taxi, emergency medical services and single-pilot commercial air transport operations. The third of the five regulations is regulation 2111/2005, which establishes the list of air operators banned from operating into the EU on safety grounds; the fourth is regulation 996/2010, which sets requirements for the investigation of air accidents and incidents; and the final one is regulation 376/2014, which establishes requirements for civil aviation occurrence reporting. The implementing regulations each deal with a specific aspect of aviation safety regulation, including the design, construction, maintenance and operation of aircraft; the licensing of flight crew, maintenance engineers and air traffic controllers; the provision of air traffic management and air navigation services; and the design and operation of aerodromes.
The draft instrument makes the changes necessary to ensure that those regulations, when retained in UK law on exit day continue to function correctly. The changes include, for instance, making it clear that the retained legislation applies only to the UK and not
“the territory to which the treaties apply”,
and replacing references to the competent authority with references to the Civil Aviation Authority.
The instrument also transfers certain functions currently undertaken by EASA to the CAA—for example, approving organisations that design aircraft, and certifying the design of aircraft and engine types. Under the EU regulations, the Commission has a number of functions, including the power to adopt regulations, to adopt or amend technical requirements and to make certain limited amendment to the principal EU regulations. These legislative functions will be transferred to the Secretary of State to be exercised through regulations subject to the negative resolution procedure. These powers are very limited, and are designed to ensure that the regulatory system can adapt to technical developments and changes to the international standards adopted by the International Civil Aviation Organisation.
All certificates, licences and approvals issued by EASA or EU EEA states prior to exit day will remain valid in the UK by virtue of the withdrawal Act if they were valid in the UK immediately before exit day. The draft instrument provides that such certificates should be treated as if they were issued by the CAA. With the exception of certificates relating to aircraft design, the instrument also limits the validity of such certificates to two years after exit day, after which time CAA certificates will be required. The CAA needs to issue the safety certificates to have full oversight over aviation safety in the UK, in accordance with the UK’s obligations under the Chicago convention.
As I said in my opening remarks, we are continuing to work to achieve a positive future relationship with the EU, but these instruments are an essential element of our contingency planning for a no-deal exit. They would ensure that, in the event of a no-deal exit from the EU, the UK’s framework for aviation noise, statistics and safety continues to work effectively, and that the aviation industry and consumers have clarity about the regulatory framework that will be in place. I commend the instruments to the Committee.
Karl Turner (Kingston upon Hull East) (Lab)
It is a pleasure to serve under your chairmanship, Mr Gray. I note that the Government are starting to group instruments together. That seems inevitable, as we may well be running out of time, but it speaks to the fact that the Government’s handling of Brexit has been a complete and utter debacle from the very outset. It would be good if the Minister gave us an idea of how many more instruments are required in the aviation sector and whether they will be grouped.
I can confirm that we support these statutory instruments. The Aviation Noise (Amendment) (EU Exit) Regulations 2019 make changes to domestic EU-derived legislation relating to noise. The changes will ensure that the legal framework relating to noise continues to function correctly after the UK leaves the EU. The legal framework will operate in a self-contained way in the UK, but will keep the same requirements of UK-registered aircraft. It will continue to follow the international standards laid down by the International Civil Aviation Organisation. It keeps the UK noise regulations in line with the EU’s. We recognise that the instrument is needed as we leave the European Union.
The instrument brings responsibilities currently held by the Commission back to the UK—in this case, to the Civil Aviation Authority. There will be a cost impact to that. I think I am right in saying that the amount for extra staffing at the Civil Aviation Authority amounts to something in the region of £192,000. That seems a very conservative figure, so will the Minister tell the Committee how many staff will be required?
On the Aviation Statistics (Amendment etc.) (EU Exit) Regulations 2019, the statistical returns regulations require airport operators to provide statistical data to EU member states, and require member states to collect data from airports and transmit statistical returns to Eurostat. If there is no agreement with the EU providing for the UK to send statistical data after exit, we will no longer send data to Eurostat. The instrument obliges respondents to provide data to the Civil Aviation Authority, and gives the CAA the power to force airport to provide it with statistical data. The explanatory note makes no reference to the Civil Aviation Authority being provided with any extra resources to carry out this function. Does the Minister feel that it is already fully resourced to carry out these additional functions?
In relation to the aviation safety regulations, current safety functions are done on the basis of the UK being a member of EASA. On numerous occasions I have asked whether the Government intend to negotiate to ensure that we remain a member of EASA. The Minister has never been able to confirm the Government’s position in relation to that.
In this case, the UK-wide regulator will no longer be the UK-wide regulator. It already undertakes the majority of certification and oversight tasks required by the retained EU legislation. It is important to note that we will continue to have the same technical requirements and standards as the EASA system on exit day. Could the Minister explain the position for the next stage of negotiations? Will they definitely make the case for the UK to continue to be a member of EASA?
As with the other two instruments that we are discussing, this SI brings functions from EU bodies to the Civil Aviation Authority. Again, I reiterate my questions around resources. I would be grateful if the Minister addressed my points. I am sure the Committee looks forward to his answers.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Many, if not all, of the points I would like to make have been covered, so I will just make some general comments. In essence, this is about rights for people in their homes and those who might be affected by aircraft movements, as well as the rights of the air industry, passengers and travellers, relating to their lives, convenience, business and safety. Yet here we are, 11 days out from Brexit, trapped on a flight to nowhere, with no pilots and mired in on-board fighting. Eleven days to go—it is an absolute scandal.
Scotland did not vote for this and we do not want this. As well as this unnecessary farce, there are still far too many unanswered questions for aviation and everything else on Brexit, especially the calamity of no deal. It is time to evacuate from this Brexit, to delay article 50 and put this back to the people.
Jesse Norman
I thank the hon. Members for Kingston upon Hull East and for Inverness, Nairn, Badenoch and Strathspey for their questions, which I will address in turn. The first question raised by the hon. Member for Kingston upon Hull East was about the number of further SIs to be debated. I am delighted to tell him that I do not expect us to have to debate any further SIs on aviation. Therefore, on the question of grouping—[Interruption.] I am sure colleagues will feel extreme joy. Certainly, there is a little frisson in the ministerial team. That is good news.
The hon. Gentleman raised the question of the cost impact on the CAA. I think he will agree that the number he raised—£192,000—is remarkably small. I reassure him that the CAA is well advanced in managing the overall burden of its scale-up for Brexit. There are something like three more people to be retained or hired, and this sum relates to those people. There are currently 47 full-time equivalent staff in place out of 50, with three expected, so I think the CAA is well on top of the issue.
The hon. Gentleman asked whether we will have to remain part of EASA. He will understand that we wish to continue UK participation in EASA for all kinds of reasons. It is a highly respected organisation. The CAA has always had a very close relationship with it. As we discussed, the CAA was one of the progenitors of EASA. It is in the interest of both the UK and the EU not to disrupt existing safety arrangements. The CAA has not unfortunately been able to hold formal discussions with EASA about EU exit issues, but it is clear, as are we, that it will need to liaise with EASA very closely in the event that this country leaves the EU without a deal. Many of those relationships are already in place.
I am grateful to the hon. Member for Inverness, Nairn, Badenoch and Strathspey. I lack his skill for aviation metaphors, such as evacuation, bail out or whatever. He was right to focus on rights. I hope he is reassured that this, as a formal lift-and-shift and modest correction exercise, does nothing to impugn the rights of people as they currently exist under this legislation. Indeed, it seeks to ensure that they are protected by ensuring that the UK statue book continues to work in a functional way for aviation. I hope the Committee supports the statutory instruments.
Question put and agreed to.
Draft Aviation Statistics (Amendment etc.) (EU Exit) Regulations 2019
Resolved,
That the Committee has considered the draft Aviation Statistics (Amendment etc.) (EU Exit) Regulations 2019.—(Jesse Norman.)
Draft Aviation Safety (Amendment etc.) (EU Exit) Regulations 2019
Resolved,
That the Committee has considered the draft Aviation Safety (Amendment etc.) (EU Exit) Regulations 2019.—(Jesse Norman.)