Business: Greenwashing

Debate between Lord Callanan and Lord Howarth of Newport

Tuesday 10th January 2023 Lords Chamber

[Lord Howarth of Newport]

To ask His Majesty’s Government what assessment they have made of the practice of ‘greenwashing’ by businesses; and what steps, if any, they intend to take to tackle it.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, green claims made by businesses should be clear and accurate and not mislead consumers, who are increasingly looking to make environmentally friendly choices. The Competition and Markets Authority and the Advertising Standards Authority have published guidance to help businesses to comply with the law when making environmental claims about their goods or services. If a business does not comply with consumer law, the CMA and other bodies, such as trading standards, can bring court proceedings.

[Lord Howarth of Newport (Lab) [V]]

My Lords, while many businesses are genuinely committed to the net-zero objective, should not there be zero tolerance when businesses puff their publicity and accounts with dishonest claims about their green credentials? Does the Minister accept that for those businesses self-regulation will not work, that tough regulation and penalties are needed to deal with these fraudulent practices, and that the Government must work urgently with international partners to establish standardised accounting rules, an end to bogus carbon offsets, rigour in the definition of ESG, and reliable and clear information for investors and consumers?

[Lord Callanan (Con)]

I understand the point that the noble Lord makes, but businesses do not self-regulate in this area. In September 2021, the Competition and Markets Authority published guidance on environmental claims on goods and services, to help businesses to understand how to communicate their green credentials while mitigating the risk of misleading consumers. The Advertising Standards Authority has also taken action against some businesses.

European Union (Withdrawal Agreement) Bill

Debate between Lord Callanan and Lord Howarth of Newport

Report: 2nd sitting (Hansard - continued) & Report stage & Report: 2nd sitting (Hansard - continued): House of Lords
Tuesday 21st January 2020 Lords Chamber

[Lord Howarth of Newport (Lab)]

My Lords, this amendment proposes that we should not regress from the existing EU-derived rights and practices in relation to the protected matters specified in the amendment. I see no difficulty in principle about that. There may be much merit in it in terms of continuity of public policy and of reassuring the public that we will maintain the standards that have so far been established by the EU and continue to conform with them.

But it is surely essential that we retain the right to diverge. The noble Lord, Lord Howell, gave some very important reasons for this. The world is changing, and our country and economy need to be alert to all the changes that will provide opportunity for us in the future, as we seek our fortune in a wider world. The eurozone economy is a relatively inert and sluggish region of the global economy. While much has been achieved and very important protections have been established for workers’ rights and environmental issues, as the noble Baroness has just mentioned, and we do not want to lose that acquis—those achievements and benefits—we have got to be flexible and be able to be innovative.

The essential principle of Brexit is that we take back control of our laws. It is an entirely reasonable proposition that this Parliament should legislate to perpetuate our conformance with certain particular laws that have already been enacted. It is a very different proposition that we should commit ourselves to the proverbial level playing field and the principle of non-divergence following the end of the implementation period. That is not what is envisaged in the amendment, but it seems to have been contemplated by a number of noble Lords in their speeches. If taking back control of our laws means anything, it means that we must reserve the right to diverge. Indeed, we will need to have the right to diverge even from what has already been established and achieved when it proves in some sense obsolescent, as new reasons and new horizons emerge for the kind of changes and developments that we would seek to achieve in our economy.

[The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)]

I thank all noble Lords who took part in this debate. I thank the noble and learned Lord, Lord Goldsmith, for so eloquently introducing the subject. The amendment is very much like proposed new Clause 31, tabled by the noble Baroness, Lady Jones of Whitchurch, in Committee. I am grateful to the noble Baroness and the other noble Lords who took part in the debate on that amendment as well. Noble Lords will be completely unsurprised to discover that the Government’s position on this matter remains unchanged.

The amendment fundamentally mistakes the nature of the Bill before us. The amendment is about our domestic policy post exit in a number of extremely important areas. However, by contrast, the Bill is about implementing the withdrawal agreement into domestic law. It is not about our post-exit domestic policy, important though that is. Therefore, we believe that the amendment is wholly inappropriate for this Bill. However, since the amendment has drawn us into a debate, even though it is beyond the scope and purpose of the Bill, it might be useful for me to reiterate how we will take decisions about issues such as environmental standards and other matters once we have left the EU.

As I set out in Committee, these matters were debated extensively during the passage of the 2018 EU withdrawal Act. I remember replying to that debate; I think that many of the same noble Lords who contributed today took part in that debate as well. Noble Lords will remember that, back then, the concern raised was that the Section 8 power in that Act would be used to regress from EU standards. I reiterate that the Section 8 power can be used only for the purposes of correcting deficiencies that arise as a consequence of the UK’s withdrawal. That is what we said then, and I think that our record has proven that to be the case.

The 2018 Act does not provide a power to change laws simply because the Government did not like them before exit, and the Government cannot use the powers for the purposes of rolling back standards and protections merely because we wish to do so. Instead, where we seek to depart substantively from retained EU law, separate legislation will be brought forward, as indeed it already has been in certain areas. At that point, Parliament will, as normal, have its opportunity to scrutinise the Government’s actions. This would allow for tailored and intense scrutiny. I have no doubt whatever that this House and the other place will fulfil their duties in this regard with great vigour. Once again, I reiterate our view that these debates are for that future legislation.

In any case, I can reassure noble Lords that the Government have no plans to introduce legislation that would have a regressive effect. We will not weaken protections in these areas when we leave the European Union; rather, we will maintain and enhance our already high standards.

We spoke at length in Committee about the Government’s record on the environment, chemicals, food standards and animal welfare. For the sake of clarity, I will again set out some of our commitments. First, the UK has a long and proud history with regard to the environment and it is of the utmost importance that this is maintained when we leave the EU. There are areas where we are already planning to go further than EU legislation permits, such as single-use plastics. The Government will shortly be introducing the environment Bill, which we promised during the 2018 debates. It will strengthen environmental protections and enshrine environmental principles in law.

I will take this opportunity to reply to the point made by my noble friend Lady McIntosh on the subject of sow stalls, a debate which I remember well from my time in the European Parliament. That is an example of the UK going beyond EU rules in the full knowledge of the likely consequences. We chose to go further. We may decide—I am not committing us—to go further on live animal exports and in other areas, enhancing what protections are currently provided under EU law. If we do, we should consider the consequences. However, as the noble Lord, Lord Howarth, correctly pointed out, the whole point of Brexit is to take back control. These are decisions which we can make for ourselves in this Parliament in future. We do not need an external power dictating what we do in these regards.

On employment rights, I reassure the noble and learned Lord, Lord Goldsmith, that we are committed to ensuring that workers’ rights are protected as the UK leaves the EU. We are legislating in areas where the EU is only just starting to catch up. It is the UK that has been shaping the agenda on tackling abuses in the gig economy, a point well made by my noble friend Lord Howell of Guildford. As we announced in the Queen’s Speech, we will be bringing forward legislation to continue delivering and building on the Good Work Plan. This will give workers in the UK the protections they need in a changing world of work. Much as I greatly enjoyed the entertaining vignette from the noble Lord, Lord Hendy, I remind him that in a number of these areas—including holiday pay and maternity pay—the UK already goes much further than EU minimum standards permit. That is something that we should be proud of, and it is something that we are going to build on.

I have set out the Government’s view that this amendment is not appropriate for this Bill. I have also, I hope, provided some reassurance about the Government’s intentions regarding some of the issues raised by the amendment. I will close by noting that the effect of the amendment is unclear. The proposed new clause before us makes government action with a “regressive effect” unlawful, but it leaves many of the key terms unworkably vague. It is somewhat surprising that the noble and learned Lord, Lord Goldsmith, does not appreciate the poor wording of the amendment. First, the failure to define “protected matters” makes the scope of the amendment unclear. Secondly, the uncertainties in the definition of a “regressive effect” would create a great deal of legal uncertainty. Perhaps he is hoping for some legal uncertainties, as they would provide more work for lawyers. That was a joke, by the way. “Regressive effect” is defined as an effect that

“reduces a minimum technical standard … or … weakens governance processes associated with that standard or protection.”

The meaning of a reduction or a weakening, in this context, is not at all straightforward. Making this regressive effect unlawful without a clear definition carries significant legal risks, and may restrict policy with a progressive design, as the Government may avoid making policy changes for fear of acting unlawfully. This could impede delivery of post-Brexit government policy intended to deliver improvements in these areas.

To give an example, the waste framework directive sets targets for preparing for reuse and recycling of waste to achieve the EU’s ambition to move to a circular economy. I think that we would all support that. The targets are set on weight, so the directive obliges member states to ensure that a minimum of 55% by weight of municipal waste is reused and recycled by 2025, 60% by 2030 and 65% by 2035. However, weight-based targets may not lead to the optimal environmental outcome. If the UK were to remove this target and replace it with a target set on a different metric—on carbon, for example—while the UK could have improved standards, we could still be held to have regressed on environmental protections, were this amendment to become law. This kind of legal uncertainty has been decried in other debates.

This Bill is the vehicle to implement the withdrawal agreement in domestic law; it is not to legislate for our post-exit domestic policy in these areas. That is for separate debates in separate fora. We will no doubt have them with great vigour, as we do in all these policy areas. The amendment is neither necessary nor appropriate for the Bill. The Bill will ensure that we move forward and focus on our domestic priorities. Noble Lords can already scrutinise any changes that regulations might make to retained EU law under the Section 8 power. As I said earlier, and say again for the benefit of clarity, the Government are committed to maintaining and enhancing our already high standards, including through legislation where appropriate. I hope, given the reassurances I have provided, that the noble and learned Lord is able to withdraw his amendment.

--- Later in debate ---

[Lord Callanan]

My Lords, we have reached the final amendment. I thank the noble Lord, Lord Howarth, and the noble and learned Baroness, Lady Butler-Sloss, for their comments and for setting out their positions. I understand the concern of noble Lords about the parliamentary procedure attached to the consequential power in Clause 41. We have already noted these concerns; noble Lords in other debates have raised them and we all read closely the reports of the Delegated Powers and Regulatory Reform Committee and the Constitution Committee. I addressed many of these points last week, when I spoke to the amendment in the name of the noble Lord, Lord Tope. I hope today to provide similar reassurances to the noble Lord, Lord Howarth. I agree with so many of his points on EU withdrawal, although perhaps not this one.

As noble Lords are aware, consequential powers are standard provisions in legislation, even legislation of great constitutional significance, such as the Scotland Act. If noble Lords look at Schedule 5 to the Bill, they will see that we have already included many of the consequential amendments required as a result of the Act. However, we also believe that we need a power to make further consequential provisions to the statute book.

I am aware that the noble Lord, Lord Howarth, yesterday asked for assurance about why the consequential power in Clause 41 is subject to the negative procedure. I understand the noble Lord’s concern but reiterate that the power is limited to making amendments that are consequential to the contents of the Act. Its scope is very different from the powers discussed over the last 10 days by my noble friends Lady Williams and Lord Duncan, which will be used to implement the withdrawal agreement. It is in everyone’s interest that the statute book functions effectively. Moving the consequential provision to the affirmative procedure would frustrate the ability of departments to make the necessary consequential changes before exit day and could lead to legal uncertainty. I hope noble Lords agree with me that this is not the appropriate course of action.

This procedure is limited to giving Ministers the power to make regulations that are in consequence of the Act, like consequential powers in many other pieces of primary legislation. This power will be construed strictly by the courts. It can be used only to make amendments that are appropriate to legislation in consequence of something that the Act does. I am sure noble Lords agree that the use of the negative procedure does not prevent parliamentary scrutiny taking place. Members of this House will still have the opportunity to pray against regulations, should they consider them inappropriate, as is usual for regulations of this kind. I hope I have provided the necessary reassurances to the noble Lord and that, as a consequence, he is able to withdraw his amendment.

[Lord Howarth of Newport]

The noble Lord, Lord Callanan, has not provided me with the reassurance I seek. In my earlier remarks, I anticipated the arguments that he would offer about why we can be relaxed about these powers being taken and believe him when he says that the scope would be minimal. That is not the case. I am extremely grateful to the noble and learned Baroness, Lady Butler-Sloss, for speaking as a most distinguished lawyer. She encourages me, in my legal amateurism, to believe that I am on the right track. I think I am. I hope that, even overnight, the Minister may be willing to reflect further on this, and that the Government will accept the amendment. It would be in earnest to the magnanimity on the part of the Government that I venture to hope might manifest.

[Lord Callanan]

For the avoidance of doubt, this is not a matter that we will reflect on further. Therefore, if the noble Lord wishes to pursue his amendment, he needs to test the opinion of the House.

[Lord Howarth of Newport]

I also hoped that the Government might want to demonstrate their good intentions towards their future constitutional behaviour, but there it is; we cannot win every battle. Maybe, in the watches of the night, the Minister will repent and reconsider. On that basis, I beg leave to withdraw the amendment.