Organic Production and Control (Amendment) (EU Exit) Regulations 2019

Debate between Baroness Miller of Chilthorne Domer and Baroness Jones of Whitchurch

Wednesday 13th March 2019 Grand Committee

[Baroness Miller of Chilthorne Domer (LD)]

My Lords, we warmly welcome these SIs, which are absolutely essential for the continuity of trade in organic products. We particularly welcome the fact that the Government recognise the voluntary uplift.

I declare an interest which makes me a little more passionate about the sector. I used to work for the Soil Association, albeit very many years ago. It was an interesting time to be there, as it was developing certification techniques with the EU. The sector has moved on a lot in the 25 years since.

By and large, the sector is very happy with these SIs, as are we; it did not have any concerns about them as they currently are. The sector is happy that they are being proposed and debated as a framework for certainty for organic producers and consumers.

As the noble Baroness, Lady Byford, said, it is a really vibrant market. The organics market in the UK is worth some £2.3 billion, of which 8% goes abroad, mainly to EU countries. The importance of the organic sector for the UK is that it has introduced consumers to many ideas about more sustainable agriculture. So apart from being worthy both in economic terms and as an employer, it has been a flagship, introducing ideas around sustainability, the importance of soil, issues around chemical inputs and so on. It really is a sector that deserves our full attention.

The Government have taken the necessary step to ensure the continuity of trade through this SI. If there is any concern, it is really that this is a period of certainty for only 21 months. As annexe 2 mentions, at the end of that period, things will become uncertain again. In farming, 21 months is as nothing. If you are trying to make investments or change your farming methods, or if you are in conversion, 21 months is an extremely short time. Both producers and UK certification bodies would like to move as soon as possible to a period of greater certainty; I hope that the department is working on that.

The question of how the regulation will be administered, controlled and, particularly, developed in the light of future changes and challenges is something that I hope the Minister can touch on in her reply. Undoubtedly, there will be challenges from developments within other organic regulations. It is a fairly fast-moving scene now, with different products being withdrawn or coming on to the market. Of course, if we start to enter into trade agreements with the US—heaven forbid, but it is possible—that will be a massive challenge. I hope the Minister can give us some certainty about how this is going to be developed.

For consumers, it is equally important that the certification is gold-plated. Organic products command a premium price, so it is essential that consumers, when paying that premium price, can absolutely rely on the origin processing methods of that produce. Otherwise, if any doubt enters that market, it would adversely affect all those who are engaged in genuine organic production.

It would be difficult this afternoon not to mention tariffs—I heard the Minister’s caveat, so I will mention it only briefly. That will be another massive pressure on producers. I gather that tariffs are about to be published or may have been published this afternoon. That is another huge pressure on producers that I hope we will have the chance to debate in your Lordships’ House in the very near future.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am grateful to the Minister for introducing these SIs this afternoon and for organising the helpful briefing beforehand. We accept that these SIs are necessary to maintain current standards regulating the UK’s growing organic sector. The continued availability of high-quality produce and sustainable food supplies, in which the organic sector plays a key role, is vital for our food industry and important for consumers. For example, the Soil Association reports that the UK organic sector grew by 5.8% in 2018, its eighth consecutive year of growth. As the EM makes clear, the industry is worth something like £2.2 billion to the UK economy. I very much take the point of the noble Baroness, Lady Byford, who quite rightly said that so many people in that sector work in small businesses and make a particular contribution to the economy in that regard. Obviously, it is important that their futures are protected.

The noble Baroness, Lady Miller, said she felt that the sector did not have any concerns about these SIs. I will come back to that, but the Minister will be aware that the industry is already reporting negative impacts caused by the ongoing uncertainty of Brexit. Confidence is being undermined and businesses are warning that the consecutive years of growth achieved by the UK organic sector could be at risk. Therefore, we are looking to this batch of organic-related SIs, and to what the Minister is able to say this afternoon, to reassure the market of continued access, which the sector deserves and requires.

With this in mind, I have some questions for the Minister, the first of which is on imports. The noble Baroness, Lady Miller, raised the issue of the 21-month deadline. Annexe 2 of the Explanatory Memorandum says:

“For a strictly time-limited period of 21 months we will exempt the need for additional checks or paperwork for organic goods being imported directly from the EU, the EEA states or Switzerland except those organic goods which do not originate from but are simply transiting through these territories”.


I would like to explore what that 21-month deadline means. Can the Minister give some clarity on that? Has that amount of time been chosen to line up with the transition period? If so, what would happen if the transition period was extended? Is it an absolute deadline whether there is a deal or no deal? Is it written in blood, so to speak? Perhaps she could clarify the status of that 21-month deadline so that we are all clear on that.

Secondly, on exports, as has been touched on, future export arrangements with the EU are a matter for future negotiations. But can the Minister give us an assurance that future access to the EU market for our strong UK organic exporters is indeed a priority for the Government? Can she explain why we are giving guarantees to organic imports while no such guarantees are in place for UK organic exports? There is an imbalance there, and perhaps the Minister can explain why that is the case.

The Government have given notice that, after 29 March, importers will no longer use the EU’s Trade Control and Expert System New Technology, or TRACES, to register consignments of organic produce but must use a manual UK organic import system while a digital system is being developed. Can the Minister give the Committee an update on the progress in building the UK’s own digital system? Will it be fully functional on exit day? What work is being done to ensure that UK industry and its international partners are aware and prepared for this change? What assurances can the Minister give that the temporary manual system, and eventually our own permanent IT system, will provide the same level of certainty over origin and movement of produce as we have at the moment?

Paragraph 12.3 of the Explanatory Memorandum, on control of imports, explains that there has not been an impact assessment but:

“There may be minimal familiarisation needed for businesses to set up to use the new import and export systems”.


Can the Minister say what “minimal” means in this instance? Is she assured that this rather minimal objective has been achieved, and will that give businesses the information and knowledge that they need to be able to operate under these new systems? In other words, is the Minister sure that the communication and training systems are in place, running fully and meeting their objectives?

On the ongoing issue of resources and expertise, annexe 2 to the Explanatory Memorandum on control of imports states:

“The UK will be able to accept applications from overseas control bodies to certify to the UK organic standards, and subsequently approve these bodies if the UK wishes”.

Currently, Defra has approved eight certification bodies: six in the UK and two in Ireland. Is any additional expertise or resource needed for the UK to consider and process other applications when we are basically on our own in this matter, rather than having the EU’s information scrutiny process to rely on as well? Are those eight certification bodies up to the job and resourced properly, and do we need other certification bodies?

On a small point, annexe 2 in both SIs explains that certain duties—in Articles 29 and 38 of the Council regulations—have been downgraded from “shall” to “may”. The notes explain that these duties have already been completed by the EU. Will the Minister provide more information on what these articles include and why the specific duties have been downgraded? What is the thinking behind that? If they have been fully completed by the EU, perhaps they are not needed at all and there should be no reference to “may”.

Warm Home Discount (Miscellaneous Amendments) Regulations 2016

Debate between Baroness Miller of Chilthorne Domer and Baroness Jones of Whitchurch

Thursday 21st July 2016 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

My Lords, first, I welcome the Minister to this addition to her brief—that is the best way of putting it—and look forward to debating energy issues with her in the months to come. I thank her for introducing the regulations this afternoon.

The Minister will of course know that it was the last Labour Government who initially took steps to convert the earlier voluntary scheme into a compulsory scheme back in 2009, so of course it is natural to expect that we welcome the proposed extension of the scheme. No one should struggle to heat their homes over winter, and the continuing scandal of fuel poverty and excess winter deaths shows how vital this policy has become. However, we have major concerns about the delay in tabling these regulations, which have now been echoed by the Secondary Legislation Scrutiny Committee, which concluded that the delays will make the policy intent unobtainable this winter. That is the reason I am moving the amendment this afternoon. I will therefore ask the Minister about the timing of these extended regulations, as it appears increasingly unlikely that the policy objective of reaching customers before the winter months will be achieved.

The policy was announced by the Chancellor in November 2015, but by all accounts—the Minister confirmed this—there was a delay of five months while cross-departmental wrangling was resolved. However, I do not accept what the Minister said—that this can be written off as an unusual period. After the four-week consultation ended, it took another two months for the regulations to be laid before Parliament, and now here we are on the last day, rushing them through.

The result of this delay is that the rebates will begin to apply only in December, with some not being received until January or February next year, which is well after the cold winter weather will have set in. A number of respondents to the consultation raised particular concerns about customers on prepaid meters, who have to pay up front, often on the most expensive tariffs, and who will not receive the payments in time to make a difference to their fuel poverty. Does the noble Baroness agree that this delay is unacceptable? What steps is she taking to address the problem through departmental co-operation so that these events do not happen again? What dialogue is taking place with the suppliers to introduce the rebates in the speediest possible way, given that this delay has occurred?

Secondly, there remains a problem with targeting the payments effectively. The then Secretary of State acknowledged earlier this year that only 15% of households in receipt of rebates have both low incomes and high energy costs—that is, they are in fuel poverty. Meanwhile, in 2014 over 10% of households were classified as being in fuel poverty, and the number is rising. There is an urgent need to target the payments more effectively to those most in need. Therefore, can the Minister clarify how the proposed data sharing will improve targeting to the most vulnerable customers, many of whom are unaware of their entitlements to these payments?

Finally, how do the Government intend to address the criticisms of the CMA and others that energy companies continue to overcharge their customers? This is compounded by the difficulties that suppliers put in place for customers seeking to switch. Indeed, a recent Sunday Times consumer advice article recommended that people did not even try to switch suppliers until the Government had made the process easier. For that reason, I am moving the amendment and I look forward to the Minister’s response.

[Baroness Miller of Chilthorne Domer (LD)]

My Lords, I am very grateful to the noble Baroness, Lady Jones of Whitchurch, for bringing several aspects of these regulations to our attention—not least the comments from the Secondary Legislation Scrutiny Committee.

Of course, as the Minister said, the Prime Minister, in one of her first speeches, made many comments on social justice, but I fear that these regulations were written before she made that speech and perhaps there has not been a chance to assimilate the new spirit that she wants to introduce. As I understand it—perhaps the Minister will correct me if I am wrong—the regulations contain several things that are less than desirable, one of which is that they cover only the next two years, whereas in last year’s spending review there was a guarantee that the scheme would carry on until 2021.

On the larger picture, it is very depressing that the long-term strategy of reducing bills through energy efficiency—particularly measures that came in under the coalition Government, such as the zero-carbon homes measure—have been put on hold and we have seen this Government back-track, not least in the recent Housing and Planning Bill. Therefore, we have a big problem. The fact that people are in severe fuel poverty and are unable to heat their homes during the winter is, as has been said many times in this Chamber, one of the biggest disgraces for a civilised society.

The funding for the years after 2018 will be based on the number of customers who have benefited from rebates. What do the Government intend to do to promote the scheme to people who can benefit from it, making sure that they do not miss out?

Finally, the Explanatory Memorandum says that the Secretary of State can conduct a review if it is thought desirable. Perhaps the Minister can say a little more about under what circumstances it will be desirable. She mentioned that there would be another opportunity for noble Lords to comment, but we feel very strongly that this review needs to happen so that we are quite clear about the effect of the regulations and so that we have another chance to push for something better.