Product Safety and Metrology etc. (Amendment) Regulations 2024

Monday 20th May 2024 Grand Committee

Considered in Grand Committee

18:27

Moved by

[Lord Offord of Garvel]

That the Grand Committee do consider the Product Safety and Metrology etc. (Amendment) Regulations 2024.

Relevant document: 23rd Report from the Secondary Legislation Scrutiny Committee

[The Parliamentary Under-Secretary of State, Department for Business and Trade (Lord Offord of Garvel) (Con)]

My Lords, to put this SI into context, in order to place many manufactured goods, ranging from toys to machinery, on the market in Great Britain, manufacturers must ensure that products comply with the requirements of product regulations. Following EU exit, many EU product regulations were integrated into UK law, and we introduced the UK conformity assessed regime—UKCA—as our product regulation approach in Great Britain.

Since 1 January 2021, UKCA has been in use alongside recognition of the EU’s CE and reversed epsilon markings. This recognition of the EU’s CE and reversed epsilon markings is due to end on 31 December 2024, meaning that manufacturers of products in scope of this instrument would have no choice but to meet UKCA requirements to sell their products in Great Britain legally. The Government know that businesses currently face increasing burdens, with cost of living pressures and global supply chain challenges. As part of our smarter regulation programme, we are looking to minimise regulatory burdens where feasible to reduce business costs and help grow the economy. That is why we are introducing this instrument to continue the recognition of EU requirements using powers under the retained EU law Act 2023.

18:30

Last year, the Government held a series of roundtables to hear views from industry, including around 200 domestic and 50 international industry representatives. Industry in the UK and those who supply Great Britain from abroad indicated that ending CE recognition and mandating UKCA would cause issues for their businesses. It could increase costs and require duplicative processes, leading to higher prices and less choice for consumers in Great Britain. Some overseas suppliers also reported that they may reduce or stop sales to Great Britain completely.

This instrument will continue recognition of EU requirements, including the CE and reversed epsilon markings, providing businesses with the choice to use either EU markings or UKCA to place products on the market in Great Britain. Secondly, this instrument will introduce a fast-track UKCA measure, which will provide manufacturers with more flexibility on how to use the UKCA marking to place products on the market of Great Britain without compromising on legal product requirements.

This instrument will apply to 21 product regulations managed respectively by the Department for Business and Trade, the Department for Energy Security and Net Zero, the Department for Environment, Food and Rural Affairs and the Health and Safety Executive under the Department for Work and Pensions.

The Government are taking a tailored approach to ensure regulation works for the sectors and consumers covered by different regulations, including those outside the scope of this instrument. We have listened to feedback from industry, and this instrument is designed to remove costs and burdens for businesses and provide certainty on our approach to product regulation.

We estimate that this instrument will save UK businesses £500 million over the next 10 years by removing duplication. This instrument will also help ensure that goods in scope can be sold throughout the UK without needing different product markings and the associated conformity assessments.

I recognise that this instrument may reduce demand for the UK’s conformity assessment market. My officials are continuing to work with the UK Accreditation Service and industry to monitor the capacity of the conformity assessment body market, ensuring that there is sufficient capacity to support a domestic route to market for relevant UKCA products.

Turning to future regulatory change, there is no doubt that technology and manufacturing will continue to evolve. Therefore, in the future, the UK or the EU may need to make changes to product regulations. The Government remain able to mandate different rules in Great Britain where it is in the interest of UK businesses and consumers.

The product safety review is looking at the regulatory framework as a whole to ensure that it is fit for the digital age and takes advantage of the UK’s regulatory autonomy to deliver a regime suited to the needs of UK businesses and consumers. My officials will continue to monitor ongoing EU product regulations reviews and updates. Where EU regulations change, we will consider whether to continue recognition of EU rules on a regulation-by-regulation basis, taking into account the views of industry and consumer safety.

This Government will be introducing legislation later this year for additional measures to support businesses, including permanent labelling flexibility and voluntary digital labelling as an alternative means of product labelling. I will share additional information with the House in due course.

To conclude, recognition of the EU requirements, including CE marking, in Great Britain is due to end on 31 December 2024 for the product regulations in this instrument. The instrument removes this deadline. The main objective of this instrument is to provide businesses with choice, certainty and clarity, giving UK manufacturers the flexibility to use either UKCA or CE for placing products on the Great British market. I beg to move.

[Lord Fox (LD)]

My Lords, I thank the Minister for this important announcement. I do not think that the Minister was in your Lordships’ House when we discussed the retained EU law Bill. If he was, he was very wise not to be on the Front Bench at the time. As your Lordships will recall, we were marched forcibly three-quarters of the way up the hill only to be marched back down again.

This statutory instrument is very much indicative of the position that we arrived at after we had marched back down the hill and is infinitely more sensible than where we would have been had we enacted the original retained EU law Bill, and for that the Government and Ministers need some credit.

I have a slight concern—I may have misunderstood. My understanding is that the deadline for recognition of CE is pushed to one side and that CE will be recognised indefinitely, except the Government retain the right to impose non-CE regulations if they decide that they want to do so. That leaves an air of uncertainty, so it would be interesting to hear a response to that.

The Minister hinted at the overall future of CA. Industry has been pushing hard not to have a dual standard, and the department has done well to bow to that. However, the point that was not being made—which we were trying to make at the time—was that it would be expensive. It is good to hear that it would have cost half a billion pounds for industry to conform to that and it is glad that it did not have to do so. Why are we retaining CA? How much resource will the Government commit to the process of having a separate standard, even though the market will inevitably drive most of the players into the CE camp for accreditation? I would like some more clarity around the future of CA.

The Minister mentioned the product safety review. I think we would all like to know when it will be published, as it was promised some time ago and is still not among us. It would be really interesting to know when it will be. I have one final question around Northern Ireland. My assumption is that this solves any potential cross-border issues between the Republic and Northern Ireland, but could the Minister confirm that?

[Lord Leong (Lab)]

My Lords, I thank the Minister for introducing this SI and setting out its purpose and the noble Lord, Lord Fox, for his contribution. I, too, was not in the House when the retained EU law Bill was debated, although I read sections of Hansard in preparation for today’s debate.

It would be churlish of me not to welcome this instrument, which effectively extends indefinitely the looming deadline of 31 December 2024—a deadline already extended twice since it was first legislated for in 2020. Business will welcome this move. It will save it time and money by not having to comply with two different and, in some cases, largely completely overlapping regulatory regimes. Consumers will welcome this move too. It removes the potential double whammy of higher prices and less choice for GB consumers that would have resulted from some manufacturers deciding it was not worth their while or the cost to meet the additional bureaucracy of the UKCA regime.

Of course, the Government have welcomed their own move. It is estimated that this SI will save businesses more than £500 million in the next decade, as the Minister stated. At the risk of being churlish, I must observe that attempts to present this as an example of their being a great friend of business stretch credulity somewhat. One would not herald the captain’s decision to change course at the last minute to avoid sailing into an iceberg that everyone else knew had been looming for a long time as a “titanic success”.

This instrument will mean that businesses can now use either CE or UKCA markers when placing goods on the GB market—although not, of course, in Northern Ireland because of its unique situation. The Venn diagram of the CE regime and the UKCA regime will become concentric circles, with the former completely enclosing the later. Despite this, paragraph 6.8 of the Explanatory Memorandum states:

“The UKCA requirements which are not, however, treated as being satisfied by the above steps are the manufacturer’s obligations to … Draw up a UK Declaration of Conformity … and … Apply UKCA product marking”.


Perhaps the Minister can explain why this remains necessary for goods which are sold in the GB market. Is this not a textbook example of meaningless rubber-stamping?

Not unrelated to this, what is the Minister’s response to conformity assessment bodies that have raised concerns with the Department for Business and Trade that demand for their services in respect of the UKCA mark will fall due to this statutory instrument? How does he intend to work with the sector to support a domestic route to market for relevant UKCA marked products?

Finally, as the Minister knows, SMEs are always at the forefront of my concerns. They will have been disproportionately affected by the costs of now unnecessary preparation for conformity to a regime that was due to come into force in less than eight months’ time. While we welcome this SI, can the Minister say if there has been any assessment of the costs that will already have been incurred across different sectors, especially those with longer lead times, and SMEs in particular? There seems little value in trumpeting potential savings if the businesses that may have benefited have already scaled down, or even closed down, their export capacity.

While we welcome this sensible SI, I do hope the Minister can illuminate the Committee with answers to my questions.

[Lord Offord of Garvel (Con)]

I thank the noble Lords, Lord Fox and Lord Leong, for their contributions. No, I was not here at the time of REUL, but I have been involved its implementation in the last 12 months at the Department for Business and Trade, and I am very proud to say that 1,400 pieces of legislation have been revoked—about 20% of the statute book. I am also very proud that we in Britain are taking, as usual, a pragmatic approach: where we can use the same legislation to effectively adopt sensible regulation, we can do that at the same time as repealing those we want to remove from the statute book. On the question of how long this will last, this is an indefinite extension, but it will be a dynamic situation going forward; it does not imply automatic divergence or indeed convergence in the future. We will assess that regulation by regulation and, in doing so, will therefore get the benefit of choosing the best route for our businesses.

Let me respond to the question of why we are retaining UKCA, raised by both noble Lords. The Government are committed to making sure that UKCA remains a viable route for businesses to sell products in Great Britain. It is important that we have our own approach because, as I said before, we may need to do something in the future that we consider to be in the interests of UK businesses and consumers that may require some divergence from the EU. We will cross that bridge when we get there. We are already, for example, using our current autonomy by having the UKCA regime introduce digital labelling, which is giving us and businesses more flexibility. In answer to the question from the noble Lord, Lord Fox, I can also confirm that this means we will recognise CE in both Great Britain and Northern Ireland for the majority regulations, again making it easier for businesses to sell products across the whole UK market.

Turning to the good point made by the noble Lord, Lord Leong, about the conformity assessment market, we have put in place a regime that we will build in future, but we will continue to work with UKAS to understand the capacity of the conformity assessment market and make sure there is sufficient capacity to ensure that the domestic route to market is still available. Although in the short term, it may require a less immediate standard, that capability will build in the future as we move forward.

To give a high-level summary, this legislation will provide industry with a path of certainty and clarity to continue placing goods on the Great British market, removing the 31 December deadline. It will reduce duplicative costs, as we have said. It will save UK businesses a significant amount of money over the next 10 years. We think that approximately 9,600 UK manufacturers will benefit from reduced conformity marking and labelling burdens, and some 2,000 UK manufacturers will not need duplicative conformity assessments. This has come about as a result of close engagement with industry. We are listening to what industry, large and small, has said; that is the role of government. We will continue to take a pragmatic approach to improving regulation in order to benefit businesses and consumers, while maintaining our commitment to high levels of protection for UK consumers.

[Lord Fox (LD)]

I asked about the quantum of continued public investment in CA, and whether the Minister can give an idea of how much investment will be going into what may become a dwindling standard going forward.

[Lord Offord of Garvel (Con)]

The noble Lord also asked about the date of review. Those are two technical issues on which, if he does not mind, I will write.

I beg to move.

Motion agreed.

Committee adjourned at 6.45 pm.