National Policy Statement for Water Resources Infrastructure 2018

Lord Gardiner of Kimble Excerpts

Thursday 11th April 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That this House takes note of the draft National Policy Statement for Water Resources Infrastructure 2018.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, plentiful water is vital for securing reliable drinking water supplies, for growing food, for energy production and other industry, and to sustain biodiversity. Securing a sufficient supply of water in the future will be more challenging as pressure from a growing population and climate change impact on us. We will also have to reduce current levels of abstraction from some sources to protect the environment.

The National Policy Statement for Water Resources Infrastructure forms part of a wider framework that the Government have established to deliver two of the goals of the 25-year environment plan: clean and plentiful water and reducing the risk from natural hazards such as drought. The purpose of the national policy statement is to summarise government policy on nationally significant water resource infrastructure in England, including setting out the need for that infrastructure.

The national policy statement draws on a number of reports looking ahead to 2050 to quantify the expected deficit in terms of water available for supply. The most recent was published last year by the National Infrastructure Commission, which was established to provide independent expert advice to government on the nation’s future infrastructure needs. It suggests that immediate action is needed to close a gap of 3.3 billion litres per day to maintain current levels of resilience. This compares to the 15 billion litres per day currently put into the public supply. We need to tackle this challenge on two fronts, reducing demand and increasing supply through a twin-track approach.

In the decade or so after privatisation, the water industry took action to reduce leaks, and levels today are down by one-third compared to 1994. However, in recent years progress has stalled and still around one-fifth of the supply is lost—around 3 billion litres per day. The National Infrastructure Commission calculates that some 1.4 billion litres per day could be saved by halving leaks by 2050. Furthermore, the Secretary of State has made it clear that a step change to reduce leaks is needed and that the industry should deliver the commission’s recommendation. For the next round of business plans, the industry has committed to an average 16% reduction by 2025; a good first step towards the 2050 target. This long-term goal is stretching, but we must be ambitious, given the challenge that we face.

We must also act to reduce our demand for water. More efficient appliances can help, but it is also about how we behave and how we value water. The water companies can help by supporting their customers to reduce the amount they use each day and they have committed to do this in their draft business plans. Levels of consumption have reduced from around 150 litres per person per day in 1999 to around 140 litres per person per day now. Actions such as revising building standards in 2015 to allow local authorities to set a higher efficiency target of 110 litres per person per day compared to the normal 125 litres per person per day for new developments, will help progress. We estimate that this standard has been adopted by around 25% of local authorities. It means that people living in new developments meeting this standard use around 30 litres per day less than those living in existing housing stock. However, I am sure we all agree that more needs to be done.

In the coming weeks we plan to launch a call for evidence on setting an ambitious target for per capita consumption. This will establish a target against which we can measure the progress of the Government and the water industry. Alongside the call for evidence, we will consult on the policy options required to reach our consumption target, such as labels providing information on the efficiency of water-using products, improving building standards and the future role of metering. We know that metering can be an important part of changing behaviour. Customers with a meter use on average 33 litres less each day than those without. The level of metering varies between companies but now stands at around 50% nationally. Action set out in draft water resource management plans would increase this to 83% by 2045. So there is much more we can do to reduce demand.

However, even with considerable ambition, fixing leaks and reducing the amount each of us consumes, there is more we must do. The gap remaining by 2050 after action to reduce demand will be around 1 billion litres per day. We also therefore need to focus on providing additional supplies. This means new or upgraded infrastructure that might transfer water across a company’s area or between companies. It might mean a new reservoir, or it could come from other solutions such as desalination or the treatment and reuse of sewage effluent. Each of these options has pros and cons. There are choices to be made as to the best balance of different infrastructure types.

[Lord Adonis (Lab)]

I thank the Minister for giving way. This issue of new reservoirs is absolutely central to the debate about new infrastructure for water. The Minister said that there might be a need for new reservoirs, but paragraph 2.6.7 of the Draft National Policy Statement says:

“New reservoirs are likely to play an important role in securing resilient supplies”.


That comes before the passage on water transfers, and raises the very big issue in water infrastructure of whether we have a national system of water transfer to enable water to be distributed from the north, where there is a surplus, to the south, where there is a shortage. It does not say whether the Government’s intention is to place a higher priority on new infrastructure for water transfers than on reservoirs. What the Minister has just said about how there “might” be reservoirs rather than this being “likely” will, if he does not mind my saying so, create further uncertainty in the wider public. Is it “might” or “likely”? What is the hierarchy in the Government’s planning between new reservoirs and new infrastructure for water transfer?

[Lord Gardiner of Kimble]

I think that the noble Lord is speaking in the gap, but perhaps I could address those points now. In that passage of the speech, I was taking your Lordships through what may be the range. It may be that I will have to address the crispness of language, but I assure the noble Lord and your Lordships that I will turn in a substantial part of my remarks to the need for further reservoirs. That passage was to say that there will be a range; we will have to assess what its elements will be as we gain more water, as I hope the noble Lord will understand, given his experience on these infrastructural issues. I can fairly confidently say that the next passages of my speech will talk about the fact that, yes, we will need new reservoirs. I hope that that is helpful.

The assessment of options and the choice of the best solutions are made as part of the statutory water resource management planning process. Every five years, the water industry looks ahead at least 25 years into the future to work out how much water will be needed to maintain supplies to customers. Water companies then evaluate all the options, including testing them with customers through consultation, before deciding on the best combination to deliver what is needed. These plans are then assessed by the Environment Agency before publication is approved by the Secretary of State. The most recent round of the process is coming to a conclusion and, despite more ambitious action to reduce demand, it is clear that in the coming decade more infrastructure will need to be built. In total, the infrastructure need in current draft plans broadly meets the deficit of 1 billion litres identified by the National Infrastructure Commission.

The Government, regulators and industry continue to improve the water resource management planning process and are strengthening the national and regional dimension through the Environment Agency’s national framework and the regional group of water companies. Ofwat’s recently established regulatory alliance for progressing infrastructure development will further supplement co-ordination between companies and the identification of appropriate projects.

Some infrastructure schemes will be large enough to qualify as nationally significant and will need to be considered using the national policy statement. The national policy statement itself identifies the national need for schemes of this nature, so it does not need to be demonstrated again through the planning process. This is where one of the main benefits of the Planning Act 2008 regime comes into play, streamlining the planning process for nationally significant infrastructure projects and ensuring timely delivery of schemes that will be vital for securing water supplies.

The national policy statement will apply to certain types of infrastructure that meets criteria set out in the Planning Act 2008. Some of your Lordships may recall that an order amending the Act was debated and agreed in November last year. The national policy statement will apply to infrastructure to facilitate water transfers, desalination plants and reservoirs with a deployable output of 80 million litres per day. Additionally, reservoirs with a physical volume of 30 million cubic metres would be included.

The Government have consulted on the development of this Draft National Policy Statement—a process that was described as exemplary by some of the witnesses who appeared before the EFRA Select Committee. We consulted on our initial approach in November 2017 and on more detailed proposals around the size and type of infrastructure that should be covered in April 2018. In November 2018 we launched a consultation on the Draft National Policy Statement as we laid the document in Parliament. Those responding to the consultation included: water companies; environmental groups, such as Blueprint for Water; local authorities; and organisations that provide advice on planning and infrastructure projects. There was broad support for the need for the statement and its relationship with water resource management plans. We will take into account the responses from consultation and any recommendations that emerge from parliamentary scrutiny when we produce the final national policy statement by the autumn. We will explain how we have done this in the formal government statement of response.

As required by the Planning Act 2008, an appraisal of sustainability has been carried out on the national policy statement alongside a habitat regulations assessment. This significant piece of work formed part of the first consultation in November 2017, incorporating feedback, including that from statutory consultees such as Natural England and the Environment Agency. The national policy statement has incorporated and will continue to be informed by recommendations from the appraisal. The final appraisal is published alongside the final national policy statement.

Having set out the need for infrastructure and the relationship with water resource management plans, the national policy statement sets out assessment principles to guide the examination of applications and more detailed guidance on the construction and operational impacts of the infrastructure types meeting the criteria of the Planning Act 2008. When deciding whether to make an order granting development consent to nationally significant water resources infrastructure projects, the Secretary of State must have regard to the national policy statement. The planning issues set out in the national policy statement that need to be considered in relation to nationally significant infrastructure align with those in the—

[Lord Lansley (Con)]

I apologise for interrupting my noble friend’s flow. I declare an interest as chair of the Cambridgeshire Development Forum. As my noble friend will know, Cambridgeshire is the driest place in the country, but none the less it has probably the fastest rate of housing growth. I want to ask a question before he moves to the nationally significant infrastructure projects. It seems that the national policy statement, in talking about shaping water resource management plans, was not quite specific enough about taking account of spatial strategies in so far as these are produced by combined authorities, in our case, or local planning authorities. There continues to be an issue about ensuring that the necessary investment is in place to supply water to development projects and not to lead to any delay, as we want to build houses and build out, and doing so is one of the Government’s objectives. That can be because the investment ahead of need criterion sometimes applies, as interpreted by the regulator. Can my noble friend perhaps look at this so that, through the water resource management plans and Water Resources East, for example, we can ensure that not just the nationally significant infrastructure projects but some of the more regional and local projects are incorporated into the water companies’ investment plans, and the regulator enables them to support some of that investment, which they currently tend to treat as speculative?

[Lord Gardiner of Kimble]

My noble friend has engaged in something that clearly is part of the reason why we need to be thinking about a range of things. The noble Lord, Lord Adonis, in quizzing my perhaps imprecise language, pointed to the need for a balance of work that will need to be done. I live in Suffolk—Cambridgeshire, Suffolk and many parts of the east are dry and will have increases in population. Part of the responsibility, working collaboratively across the piece, is to ensure that in building these houses we ensure resilience of water supply. This is precisely why a lot of work is going into this. A lot of work needs to be done in increasing supply and reducing demand.

My noble friend raises an issue that is an enormous part of the challenge. We need to supply more houses in some of the driest parts of the country. That is why I deliberately stressed in setting out the challenges that we may need to use a range of options to deal with the elements in different parts of the country. I do not want to go into desalination, because I probably do not know enough about it. However, one can imagine that there may eventually be parts of the country where this is a viable or commercial option. For the future, with a growing population—we know that there could be another 4 million in England by the end of the decade—we will need to find more water and reduce demand. My noble friend raises an absolutely acute point, certainly in relation to Cambridgeshire.

I want to emphasise a point that came up in our debate last November. When decisions are made at the national level, the Planning Act 2008 and regulations made under it set out the consultation requirements for development consent order applications, which include extensive pre-application consultation and engagement with those affected by the proposals. Furthermore, members of the public can participate in the examination process by registering their interest, thus ensuring that local views can be heard. I think that we would all agree with that.

The national policy statement is an essential piece of work to ensure that our nation has sufficient water supply and that we use it wisely. It forms part of a wider framework, which will deliver on our goals in the 25-year environment plan. Our current estimate is that up to three nationally significant projects—all reservoirs—are likely to come forward in the next five to 10 years to provide sufficient infrastructure. Looking to 2050 and beyond, more are likely to be required.

I look forward to hearing from noble Lords on these essential matters. I can assure your Lordships that the Government and their agencies are working on this matter with rigour. A number of questions may be posed and I will endeavour to answer as many as I can. However, the Government and I are most interested in assessing your Lordships’ further commentary on this matter so that we can use parliamentary scrutiny to the best benefit. I beg to move.

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[Lord Gardiner of Kimble]

My Lords, my predictions were correct. We have had great experience, much more than mine, displayed across the House on these matters. I therefore emphasise that I do not have all the answers. The intention was not for me to deliver a diktat on what the Government have decided on an important matter. It is our responsibility. We are having this debate and the consultations because one of the great responsibilities of Government is to supply one of the most essential components, not only of our lives, but of the whole ecosystem. I have made a careful note of all the questions and will not be replying to each in serried ranks, because much will unfold in the further response. I take on board what your Lordships, in their experience, have thrown into the pot, as an important resource to consider.

We have all identified the undoubted challenges that we need to address to make sure there is enough water to supply businesses and homes, and—as mentioned by all noble Lords, but specifically the noble Baroness, Lady Jones of Whitchurch—to protect the environment. This is at the core of our lives.

I turn to the noble Lord, Lord Wigley, who set out some of the historical mistakes and how one should not do things. England has always welcomed water from Wales. I was not quite as convinced when it was in flood in the Severn, but he made the point that there are ways to address these matters. We would all say that what happened before was not the finest hour of bureaucratic rule. The geographic features of Great Britain dictate considerable cross-border flows, as I have mentioned, and undoubted water dependencies between England and Wales.

To safeguard water resources, water supply and water quality, and minimise the potential for risk in this area of the Administrations’ respective responsibilities, the Secretary of State and the Welsh Ministers agreed the Intergovernmental Protocol on Water Resources, Water Supply and Water Quality, which came into force on 1 April last year. Planning systems are devolved in the UK, so any infrastructure elements of cross-border schemes require all relevant permissions from the relevant authorities within those jurisdictions. The guidance on water resource management plans sets out that a company should consult the Welsh Government for sites that affect Wales. Nothing in the Planning Act 2008 overrules the relationship with Wales with regard to water resources.

A number of other points were raised by my noble friend Lady McIntosh of Pickering. I fully intended to talk of Slowing the Flow at Pickering, but quite rightly she got there first. This is a prime example of natural capital. I think that we would all agree to the use of natural capital alongside—when we have to use it—hard engineering in certain towns, including some of those in Cumbria. We need to slow the flow above but we also need to invest in hard engineering in certain places. The most important part of what we have been learning—my goodness, we needed to learn about it—is that natural capital is a resource as well as supplying a much-needed element of our ecosystem.

A number of your Lordships, including the noble Baroness, Lady Bakewell, raised the issue of small reservoirs. Whether they are on farms or are to supply part of our national water supply, the decisions remain with local planning authorities. The Environment Agency’s national framework and regional groups will consider the whole need in a region, not just public water supply. This should help to meet the needs of smaller users, where appropriate. In the future, particularly in the agricultural sector, marshalling of water through farm reservoirs may be much more common than it already is in certain parts, particularly the eastern counties.

My noble friend Lady McIntosh and the noble Baroness, Lady Jones of Whitchurch, mentioned floods, which clearly are also important. Defra is spending £2.6 billion to protect the country better from flooding. This involves 1,000 flood defence schemes, with the intention of protecting 300,000 homes by 2021. In terms of real-terms increase, the figures reflect the fact that we need to do something and have needed to do something about flood protection and investment for quite a long time.

The noble Lord, Lord Adonis, from his previous position, particularly in terms of infrastructure, will know these matters much more intricately. We need to ensure that government and all the water regulators work together and challenge industry on its ambitions about leaks and customer consumption, and on how the needs of neighbouring companies are taken into account. We want companies to build on this in the next five years. Ofwat’s regulatory alliance and the Environment Agency’s national framework are intended to and will support the maturing regional water company groups, making sure that large water resource options that come forward for development have been adequately evaluated and are the best to meet both national and regional need, as well as that of individual companies.

I was at a meeting with the water companies about this winter’s issues, to which I think the noble Baroness, Lady Jones, referred. I had better be careful and diplomatic with my words, but the Secretary of State was correct, polite and robust in saying that matters had to be attended to. The water companies were in no doubt of the need to address some of the points made, and that it was not acceptable for customers to be without water. However, having had frozen pipes, I recognise what my noble friend Lady McIntosh said about those who work for water companies and who were out and about dealing with water pipes at a time of extreme weather. There is a balance to these matters.

In response to my noble friend Lady McIntosh on the environment Bill, someone has to say the following words from the Dispatch Box: “We wish to introduce the Bill in the summer. We have consulted on a range of changes to water legislation which may be included”. I am sorry that that is what I have to say, but I hope it is sufficient to indicate that we clearly wish to make progress on this matter.

I agree that we want further uptake of SUDS in planning and building regulations. Defra, the Environment Agency and MHCLG are working on this matter; it is an important force for good. A number of noble Lords, including the noble Baroness, Lady Bakewell, and my noble friend Lady McIntosh raised the issue of net gain. The noble Baroness, Lady Jones of Whitchurch, rightly described it as “crucial”. Paragraph 3.4 of the statement concerns environmental net gain. This means achieving biodiversity net gain first, then going further to achieve wider benefits, to deliver ecosystem services and make schemes with wider beneficial impacts on natural capital. Defra has consulted, and will continue to consult, on how best to incorporate natural capital into the planning system. It is extraordinary that we are having to discuss these matters as if we had discovered them. Working with nature seems to me an obvious consideration.

The noble Baroness, Lady Bakewell, raised resilience. It looks as though we are going to have changes in rainfall due to climate change. This could mean droughts and severe rainfall. How do we capture it so that, when we have to endure floods, we can work the system to use that water appropriately and to best advantage? This is going to be a vital element of protecting the environment. As all noble Lords said, we need to reduce demand as part of the process. We have to engage with ourselves, as well as with everyone outside this Chamber, on reducing our consumption of water. We should be looking at how other countries are dealing with the demands of increasing populations, perhaps climate change and using water wisely.

The National Infrastructure Commission sets out very good arguments for increasing resilience further. As the Environment Agency develops its national framework, we expect to test what is needed and what it would cost to increase preparedness for a one in 200-year drought to a one in 500. The current draft national policy statement alludes to this but, assimilating what your Lordships’ and others will say, the final draft can make this particularly clear. The noble Lord, Lord Adonis, intervened on the contributions of the noble Baroness, Lady Bakewell, and my noble friend Lady McIntosh about mandatory metering.

Where the Environment Agency has designated a water company as “water stressed” it can consider mandatory metering if appropriate. We will be consulting in coming weeks on further changes. It is very interesting to see the statistics from water companies on proposals for leakages and on metering numbers. We need to look at the evidence: the evidence for metering is self-evident if we are all to reduce our water consumption, but we also need to be mindful in that arena that some vulnerable parts of the community probably need a disproportionate amount of water compared to others.

[Lord Adonis]

What the Minister just said is very significant: he said that the Government will be consulting on further changes. Will the options for further changes include national mandatory metering?

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[Lord Gardiner of Kimble]

The noble Lord is rigorous in his questioning and I will be opaque in this answer: I would not want to pre-empt anything that may come up. Noble Lords have made some interesting comments, but I am not in a position to give the range of choices because I have not got that before me. I think it is always unwise to make policy on the hoof, but the noble Lord has made an important point.

The noble Baroness, Lady Bakewell, raised leakages, something we all feel very strongly about. Ofwat expects companies to justify their leakage performance commitments relative to the minimum level of leakage achievable and expects those companies with the worst records on leakage to go further. There is no doubt about it. Ofwat set out draft determinations for three fast-track companies: Severn Trent, South West Water and United Utilities. All three water companies had proposed a 15% reduction in leakage, but United Utilities is one of the companies with relatively high leakage. As part of the process, for instance, United Utilities has agreed to increase the reduction to 20% over the period 2020 to 2025. I know that this is an area the public feels very strongly about: we need to ensure that water is used wisely and that we reduce leakages very strongly.

The noble Baroness, Lady Jones of Whitchurch, raised water abstraction and the protection of the environment. As I said in my opening remarks, current levels of water abstraction from some sources will need to be reduced, because it is clear that the environment in some parts of the country is being jeopardised. That is in line with the water abstraction plan published in 2017 and river basin management plans. Clearly, we need to work with all parties to ensure that we get the right result for the environment, but yes, as I think the noble Lord, Lord Adonis, referred to, water is important for enterprise and for ensuring that this country has an economic heartbeat, so it is important that we get this right. Going back to the reason we are having this debate, we will need to invest in major infrastructure projects: that is at the heart of all the issues we have rightly discussed today. We must reduce demand but also have to attend to increasing supply. We want to go further in protecting the water environment because that is of prime importance. The noble Baroness also referred to loss of supply. The Government expect companies to increase their investment in water and sewerage in order to maintain a resilient network, fix leaks and prepare for severe weather. That is part of their responsibilities.

Looking through the key points that your Lordships raised, I hope that I have attended to quite a lot of them. I am certainly not seeking to kick any can down the road: in fact, that is not my style of words. I say to the noble Lord, Lord Adonis, that that sounds as if I am about to drop litter, which of course I have a passionate phobia about. This piece of work—and today’s debate—is absolutely not about kicking this essential matter down the line. It is about having parliamentary scrutiny and consulting organisations that have a stake in getting this right for us all. I will reflect on Hansard, because key points have been raised on demand, climate change, net gain and—I have referred to this—support. We recognise that we will need both big national infrastructure projects and small-scale projects, which is part of what I have described in lay language as the balance of how we are good custodians of our water supply.

The noble Lord, Lord Adonis, and the noble Baroness, Lady Jones, spoke of difficult decisions. I agree. The whole purpose of this debate, and for taking this matter forward, is that difficult decisions have to be taken for the national interest. If everyone is to have water, that will mean that we may well, provided it is done properly, courteously and correctly, have to ask parts of the country about this—the busy south-east and other parts of the country where reservoirs, for instance, and other infrastructure projects will be not only in the national interest but probably in the local interest as well.

I shall read Hansard again and assure your Lordships that all the points that have been made, particularly given the experience of many noble Lords, will be very important in bringing policy forward. If any of your Lordships would like to have discussions and further meetings at any stage, I would be very pleased to accommodate that.

Motion agreed.

Upland Farming

Lord Gardiner of Kimble Excerpts

Thursday 4th April 2019 Lords Chamber

[Lord Grantchester (Lab)]

My Lords, on behalf of my noble friend Lady Jones of Whitchurch, and with her permission, I beg leave to ask the Question standing in her name on the Order Paper. I declare my interests as set out in the register.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, I declare my own farming interests as set out in the register. Upland farmers have been looking after exceptional landscapes, including national parks, for generations. They are responsible for a distinct farming and cultural heritage and the production of high-quality food. We will work with farmers to improve animal health, agricultural productivity and the environment, and support enhanced rural connectivity, to ensure an economically viable future for this and future generations of upland farmers.

[Lord Grantchester]

With their vulnerability of terrain, sparsity and remoteness, the upland areas need a range of measures underpinned by good delivery systems that keep farmers farming in a wider rural economy including forestry and environmental landscape management. Has the Minister’s department considered establishing a specialist high-value unit as a successor to SDA to champion strategic development, with a clear vision for the uplands?

[Lord Gardiner of Kimble]

My Lords, as a Government, we entirely accept that the uplands have an important connection to us all. After all, they provide 70% of our water. They have an enormous environmental benefit. Through the environmental land management system, which will replace the CAP, we are looking for ways to support and encourage the next generations to do this vital work on our behalf.

[Baroness Byford (Con)]

My Lords, will my noble friend confirm the need for the 6,500 upland farmers to continue to receive public financial support? Without that, they will not succeed. Some 70 million people visit the uplands each year and that sort of payment is essential. In addition, I note the important role that small and medium-sized enterprises play in those local communities. Without that interaction, those communities will die.

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[Lord Gardiner of Kimble]

My Lords, my noble friend speaks of the whole uplands economy. Tourism—such an important part of it—is based on the agrarian systems which make us all want to visit those areas. We have said that we will continue direct payments for 2019 and 2020. There will be a transition, but we will also introduce the environmental land management system. I believe that upland farmers will have a very interesting and productive use of that scheme.

[Lord Cunningham of Felling (Lab)]

My Lords—

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[Lord Beith]

My Lords, as several Peers have acknowledged, upland farmers make a massive contribution to the care of our hill areas. However, the character and community of those areas will depend on upland farmers being more than merely park-keepers. Does the Minister recognise that if Brexit leads to very high tariffs for lamb exports to Europe, and massive imports from new trade deals with New Zealand, it could spell the end of hill livestock farming? That is really dangerous for the hill areas.

[Lord Gardiner of Kimble]

My Lords, that is precisely why I mentioned food in my Answer. Upland farmers provide excellent food for the nation and for abroad. We clearly want that to continue. We want a trade deal. I am sure that all your Lordships wish us to secure a deal for the nation, but the situation is particularly acute for the upland farmers. I referred to animal health and productivity in my reply. We want to work with the farmers to ensure we conquer many of the diseases that are a travail for them, such as sheep scab. There are all sorts of areas of work that industry, the Government and farmers can work together on.

[Lord Cunningham of Felling]

My Lords, it has long been established that hill farmers regularly have incomes in the lowest decile of all farm incomes. That has not changed over many years. If we want our uplands—whether the Scottish borders, Northumberland, the Lake District, the Peak District or elsewhere—to continue to look the way they do, it is absolutely essential that people there are given more and better support if we are to ensure that we can go on enjoying the upland countryside, as the Minister has recognised we all do.

[Lord Gardiner of Kimble]

My Lords, 53% of England’s SSSIs are in uplands. These are hugely important areas for our country. I agree with the noble Lord, who comes from an area of great upland rural and cultural tradition. Our objective is to secure that future, because it is important to us all that upland farmers still produce food and look after that wonderful landscape.

[Lord Wigley (PC)]

My Lords, since the Minister accepts that the upland farmers are the best guardians of the uplands and that there needs to be a reasonable income level, will he therefore accept that there has to be a market equivalent to what they have at the moment in exporting largely to the European market, and a guarantee of income beyond 2020, which is only next year?

[Lord Gardiner of Kimble]

My Lords, we have said as a Government that we will commit the same sum of money until the end of this Parliament. No Parliament can bind its successors, but 2022 is the likely end of this Parliament given the cycle we have. If we are to keep people on the land, they need a viable income. They also need to live a contemporary life, which is why I specifically mentioned the work we are undertaking to improve connectivity in the uplands, where we are not as strong as in other rural areas, and where we need to commit money, which we are doing.

[Lord Hannay of Chiswick (CB)]

My Lords, will the Minister confirm as a matter of fact that remaining in a customs union with the European Union would achieve the objectives that all noble Lords who have asked questions—and the Minister—have agreed must be our objective?

[Lord Gardiner of Kimble]

Our objective is to trade freely with the European Union, the EU 27, our partners in what I hope will be a very productive and long-term economic arrangement. That is what we should aim for.

Animal Health, Plant Health, Seeds and Seed Potatoes (Amendment) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Wednesday 3rd April 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 11 March be approved.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, as the Government have made clear, we intend to incorporate on to our statute book and make operable all relevant aspects of EU law from the point of exit to ensure that we have fully operable arrangements which protect our biosecurity and minimise trade disruption. This instrument covers animal health, plant health, seed marketing and seed potatoes and primarily makes technical amendments to ensure that recent EU decisions will be operable on exit day. I would like to make it clear from the outset that our biosecurity controls on animals and plants are paramount, and this instrument contributes towards ensuring that we will have the most robust arrangements in place to protect public health and the environment.

The amendments made by Regulation 2 concern recent updates on animal health control measures relating to African swine fever in certain member states. This instrument amends Commission implementing decision 2014/709, ensuring that recent updates relating to the two ongoing earlier requirements applicable to all member states are transferred to the appropriate Minister in the United Kingdom.

Appropriate Ministers are required to prohibit movement of live feral pigs and to erect advisory signage alerting the public to the ways in which the disease can inadvertently be spread by people who travel to and from affected areas. I assure noble Lords that this amendment supplements our existing powers in the Diseases of Swine Regulations 2014 to prevent and control African swine fever, including powers to cull infected animals and establish protection zones, surveillance zones and feral pig control zones in the event of any such outbreak.

Regulation 3 amends retained EU law to ensure that TSE functions operate correctly by replacing a reference to production and manufacturing processes approved by “the EU Commission” to processes approved by “the Secretary of State”.

Part 3 of the statutory instrument covers plant health. Regulation 4 applies to England only, and Regulation 5 applies to England, Wales and Northern Ireland. The instrument amends the Plant Health (Amendment) (England) (EU Exit) Regulations 2019 and the Plant Health (EU Exit) Regulations 2019 to deal with new EU plant health decisions introduced and to recognise arrangements with the Crown dependencies.

Planned meetings with the Crown dependencies concluded early in 2019 and Regulations 4 and 5 recognise the outcome of broader government agreements with them. The Crown dependencies, which include Jersey, Guernsey and the Isle of Man, are currently treated as part of the United Kingdom for the purposes of EU plant health legislation, so plants and plant products move between the Crown dependencies, the United Kingdom and the rest of the EU under the same EU plant health rules. Outside the EU, these arrangements will no longer apply, and there have been discussions with the jurisdictions concerned to agree future arrangements for the trade in regulated plant material. The Crown dependencies have agreed to adopt controls similar to those of the UK in order to continue to facilitate this trade. The changes made by this instrument give effect to those arrangements, specifically in relation to the import and movement of regulated material from the Crown dependencies.

The amendments made by Regulation 5 also deal with new EU plant health decisions recently introduced, supplementing the lists of regulated pests and plant material and controls in the regulations. Regulation 5 prescribes in full on our statute book the detailed requirements in recently introduced EU legislation preventing the introduction and spread of the damaging plant pest, the red-necked longhorn beetle. This pest is a threat to a range of fruit and ornamental species in the United Kingdom, including cherry, peach and plum. It has been present in Italy since at least 2010, where it is established in the Naples area. The specific measures that we are introducing will help protect against its introduction through, for instance, wood-packaging material and nursery plants.

Regulation 5 also amends recent EU decisions to provide for imports of ash wood from the United States and Canada to continue under the same stringent derogation provisions after exit, ensuring continuity of supply for UK businesses without compromising our biosecurity. This follows a prolongation of the EU decisions concerned, which have been proven to provide effective protection regarding this trade and which we wish to retain.

The Plant Health (Amendment) (England) (EU Exit) Regulations 2019 are also being amended to enable UK plant passports to contain specific details such as the origin, identity and quantity of the plants concerned. These are required in relation to the marketing of fruit plant propagating material and fruit plants to avoid the need for dual labelling. This follows an update of business-as-usual legislation, which has recently allowed this change to be made.

Part 4 of the statutory instrument covers seed marketing and seed potatoes, and it applies to England, as this is a devolved matter. Regulation 6 amends the Seed Marketing Regulations 2011 to allow a two-year interim period to recognise authorisations granted by EU member states for marketing the seed of new vegetable varieties that have not yet completed testing for official registration. This pragmatic approach maintains trade and will give growers in England continued access to new varieties at the earliest possible stage.

Regulation 7 addresses technical operability issues by removing from the seed potatoes regulations references to the European Commission, Community and member states, replacing references to “third countries” and removing reporting obligations to the EU.

Regulation 7 also assures continuity in supplies of seed potatoes by amending the Seed Potatoes Regulations 2015 to provide for a one-year interim period during which EU varieties and seed can continue to be marketed in England. In addition, it avoids financial loss by permitting a one-year period for existing stocks of pre-printed official EU certification labels to be used.

Regulation 8 amends the Marketing of Seeds and Plant Propagating Material (Amendment) (England and Wales) (EU Exit) Regulations 2019 to exclude the marketing in England of vegetable seed produced in Switzerland. The regulations had been amended to allow seed from Switzerland, but vegetable seed is outside the scope of the EU’s trade agreement with Switzerland—hence this change.

This instrument is required to attend to a number of elements of retained direct EU legislation to ensure its operability and appropriate functioning after exit. I beg to move.

[Baroness Byford (Con)]

My Lords, I thank my noble friend the Minister for introducing this statutory instrument, which is hugely important for the protection of both animal and plant health. I welcome the steps that are being taken within the statutory instrument. Most of the sections refer to transposing EU law into UK law, but I have one or two questions for the Minister. In Part B, on page 34 on infested zones, it says that the conclusions will be,

“based on sound scientific principles”,

and gives powers to,

“the appropriate UK plant health authority”,

to amend the buffer zones where required. Can the Minister tell us whether this power is literally transposed across or is a new initiative? If it is a new initiative, it makes good sense; if it was already there, I am glad.

On the same area of infested zones, the statutory instrument says that the demarcation can be lifted,

“if the plant pest is not detected in the area over a period of four consecutive years”.

Again, I ask the Minister: is that current practice or a new introduction within the statutory instrument?

I now move on to the marketing of seed potatoes from the EU and Switzerland, to which the Minister has just referred. On page 43, paragraph (8) refers to “GMO regulations”. Again, I wonder whether that is within the current restriction and whether it will have any bearing on any new varieties that might be worked on or introduced.

On page 3 of the Explanatory Memorandum, paragraph 2.10 refers to,

“UK plant passports to contain … information in relation to fruit plant propagating material and fruit plants”.

It states that the Plant Health (England) Order 2015 is out of date—the Minister referred to this earlier. Will it be updated or does the statutory instrument that we are debating at the moment do that?

Moving on again, I am glad to see that people travelling from the EU will be subject to the same rules as in the past when bringing plants and plant products into the UK, particularly those with their own packaging. One of the big risks we run is introducing disease from incoming plants, however well-intentioned the person was who brought them in.

The Explanatory Memorandum also refers to the European Statutory Instruments Committee’s comments that this SI has, “political and legal importance”, making “extensive amendments” to the two EU exit SIs. I wondered what these were, because when I read through it I did not pick them up. I hope that my noble friend the Minister will be able to comment on that when he winds up.

--- Later in debate ---

[Baroness Jones of Whitchurch (Lab)]

My Lords, I thank the noble Lord for his introduction to this SI and for arranging a helpful briefing beforehand. I also declare an interest as the chair of Rothamsted Enterprises, which is part of a research institute that does considerable research into plants and seeds.

When I read through this SI, I had a very real sense of déjà vu as, of course, these are issues we have debated before. I do not intend to repeat everything I said about the importance of biodiversity at that time. Many of those issues were captured expertly by the EU Energy and Environment Sub-Committee report, Brexit: Plant and Animal Biosecurity. The committee made the point:

“Geographical proximity means that the EU will always be a key source of biosecurity risks to the UK”,


and therefore argued that it was essential that the UK Government negotiate continued participation in as many of the EU’s notification and intelligence-sharing networks as possible.

The Commons European Statutory Instruments Committee also intervened to argue that the proposed SI should be upgraded to affirmative, because of its political and legal importance. We agree with that analysis. Could the Minister update the House on where we have reached in discussions with EU partners on shared intelligence and continued co-operation on biosecurity issues post Brexit? Can he update us on the plans for a UK database to capture biosecurity alerts and share information with the EU?

Turning to the substance of this SI, we accept that these amendments to the original SIs are necessary. However, we are also concerned that they are the product of what seems a rushed job, in which errors and unintended consequences will be inevitable. The original SIs were debated only a fortnight ago and now we are back here again, correcting new errors and omissions that have surfaced. I have to say that, for an SI intended to correct minor errors, there seem to be rather a lot of them.

Luckily, these have been identified before our potential Brexit day but, if a no-deal Brexit goes through, I am sure we will still be playing catch-up on other errors that come to light in months to come. Indeed, the Explanatory Memorandum makes it clear that since this SI went to the sifting committee, further changes have been made to the text. I wonder whether the sifting committee has been notified of that, because adding wording at that late stage, however minor it might be, seems a rather strange way to go about the process.

This is the inevitable consequence of civil servants and lawyers working under unreasonable pressure and parliamentarians not having enough time to review the legislation thoroughly. The Minister said that biosecurity concerns were paramount. Can he reassure the House that he is confident that our biosecurity will not be compromised by the need for these and other corrections, some of which may not even have been identified yet? Has an internal risk assessment been carried out to measure the threat of a biosecurity breach through incomplete legislative barriers?

Throughout this whole process, one of our major concerns has been the capacity to check materials coming across the EU border into the UK. We have never been convinced that there are sufficient vets and inspectors to check imports into the UK thoroughly. Can the Minister assure us that all regulated plant material brought into this country via the EU from third countries will be checked for pests and diseases? Can he also update us on the controls that will apply for animal and plant products crossing between the Republic of Ireland and Northern Ireland?

On the specific changes, the Explanatory Memorandum addresses the regulation of seeds for unlisted vegetable varieties. The noble Baroness, Lady Bakewell, gave some interesting examples. It goes on to explain that the regulations provide an amendment to allow a two-year interim period for the marketing of these varieties. The reason given in paragraph 2.15 is that it is,

“for the purpose of gaining knowledge and practical experience during cultivation in England”.

When I read this, I thought it sounded rather patronising to horticultural specialists, implying that they need to build on their practical experience. It rather implied that they did not understand the nature of the seeds that they were cultivating. We have heard a little clarification of the purpose of that interim two-year break, but it would be helpful if the Minister could clarify a little more.

Paragraph 2.10 of the Explanatory Memorandum refers to another SI on plant health in which provisions are out of date, meaning that we will need another SI before Brexit day. This issue was raised by the noble Baroness, Lady Byford. Can the Minister update the House on the progress of this separate SI? Has it now been laid, considered and agreed by this House?

Finally, may I raise the territorial range of this SI? In his introduction, the Minister set out some of the explanation. I understand that different parts of the instrument apply differently—some to the whole of the UK, some to England and Wales and some to Northern Ireland. If only part of this SI relates to Scotland, are there good reasons why the Government have chosen to have a separate policy on some aspects of this? As the noble Baroness, Lady Bakewell, said, what is the justification for a pick and mix, which is what seems to be happening at the moment? What are the implications for businesses, which are having to operate under those separate regimes when some things are UK-wide and some are devolved? I understand that there is a framework agreement, but I do not think that on issues such as biosecurity it was ever intended that they should be mixed up in this way.

It would be helpful if the Minister could explain which sections refer to Scotland alone, and what steps are being taken to create a UK-wide biosecurity framework with shared powers and responsibilities. Are we providing leadership at a national level to try to ensure that happens? It is in everyone’s interest. I look forward to his response.

[Lord Gardiner of Kimble]

My Lords, I am most grateful to my noble friend Lady Byford and the noble Baronesses, Lady Bakewell and Lady Jones of Whitchurch. Many of us have been battling over these statutory instruments in so many areas. There may well be other opportunities, but I wish to record the enormously constructive way in which we have worked together, whatever our views, to get the right result for the statute book. Biosecurity in this area is absolutely paramount. I also say to the noble Baroness, Lady Jones of Whitchurch, that I accept responsibility for any errors. I am a person of detail. I do not like errors, but I am prepared to apologise and say I am sorry about it. The instruments have all gone through the normal checking process, including checks by Defra and other government lawyers as second and third eyes. They have also been scrutinised by the JCSI. Sometimes mistakes are made and I regret that, but a lot of the reason for having this discussion today is to ensure, as we always wanted to do, that what is on the EU statute book is accommodated in our own.

Agriculture: Carbon Emissions

Lord Gardiner of Kimble Excerpts

Tuesday 2nd April 2019 Lords Chamber

[Baroness Redfern]

To ask Her Majesty’s Government what plans they have to encourage the use of precision agriculture techniques in order to reduce carbon emissions.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, I declare my farming interest as set out in the register. The advantages of precision farming and technological innovation go beyond reducing carbon emissions. They also provide a range of improvements to the environment and farm productivity. The Government committed £160 million to the five-year agritech strategy in 2013. We continue to support British food and agricultural innovation through the £90 million “Transforming food production” initiative to make food production more efficient while lightening our environmental footprint.

[Baroness Redfern (Con)]

I thank the Minister for his reply. With agricultural management using those technologies in practice while increasing agricultural productivity and income, can the Minister confirm that, with the five-year agritech strategy in its final year, the data and results will feed into the 25-year environmental plan?

[Lord Gardiner of Kimble]

My Lords, I should say that precision farming is widely used and has been very successful in raising productivity and reducing the amount of input, but certainly on the results of the five-year plan there are some very interesting schemes that are clearly going to take some time to move from laboratory to farm. As far as I can see, all of them confirm that precision farming is going to be of enormous benefit, and those results will come out into the farmland situation as soon as possible.

[Lord Cunningham of Felling (Lab)]

My Lords, is it not clear on the evidence available that Britain has a relatively poor record on the introduction of precision farming? I say that as a former Agriculture Minister, so I am not blameless myself in that regard. But has the Minister considered not only the benefits of precision farming—which are well understood to be increased crop yields and the reduction of weeds—but also its impact on wildlife in agriculture? Precision farming has very serious implications for flowers, insects and birds.

[Lord Gardiner of Kimble]

My Lords, that is precisely why I think that precision farming—which, as I have said, is being used much more widely in both the arable and livestock sectors because it directs the product on to what is required—is going to be of enormous environmental benefit in terms of the fine tuning of the use of those products. It also enhances productivity, and both enhancing the environment and increasing food production is a good thing.

[Lord Teverson (LD)]

My Lords, it is estimated by Natural England that some 600 million tonnes of carbon are sunk in English peatlands, yet they are degrading. Will the Minister tell us what urgent action the Government are taking to restore our peatlands? Should not the commercial exploitation and sale of peat stop now?

[Lord Gardiner of Kimble]

The noble Lord is absolutely right. Peatland offers the best carbon storage—double that of woodland. It is immensely important, and that is why we are implementing four projects to restore more than 148,000 acres of peatland over the next three years. Clearly, as we have seen in horticulture, the important thing is that—quite rightly—there is not quite the use of peat that there used to be, as it is such an important part of our ecosystem.

[Lord Krebs (CB)]

My Lords, no doubt the Minister will be aware that the Climate Change Committee, in its 2018 annual report to Parliament, noted that there had been no reduction in greenhouse gas emissions from agriculture between 2012 and 2017. Does he agree with the Climate Change Committee’s recommendation that the Government should “replace” the,

“voluntary industry-led framework, which has so far failed to meet emissions targets … with a stronger framework”?

[Lord Gardiner of Kimble]

My Lords, clearly we endorse the greenhouse gas plan by industry, but we are looking at further ways in which we can improve it. In fact, we have commissioned research from Scotland’s Rural College into greenhouse gas mitigation options to address what we think are existing knowledge gaps. Certainly we are working and commissioning on how best we can reduce emissions from agriculture, which produces about 10% of our emissions.

[Lord Spicer (Con)]

My Lords, if and when we sign a trade agreement with the United States, is it not likely that food prices will fall and environmental concerns relating to standards will rise?

[Lord Gardiner of Kimble]

My Lords, the basis of precision farming in this country is that we think we produce excellent food—the best in the world—both for home consumption and for export. Whatever trade agreements we have with any countries, clearly we have our own standards, which will remain. I think that people should buy British products because they are the best.

[Baroness McIntosh of Hudnall (Lab)]

My Lords, can I ask the Minister to return to the question of peat? If what he says is true—I am sure it is—that peat is the best capturer of carbon, can he tell us why peat-enhanced compost is still available for sale, even though common or garden gardeners such as myself try not to use it and there are alternatives available that are just as effective?

[Lord Gardiner of Kimble]

I shall look precisely at where the supplies are coming from, but I can say now that we as gardeners and horticulturalists should be using alternatives. As I have said, peatland is one of the most important parts of our ecosystem, and that is why we are seeking to restore 148,000 acres of it.

Plant Health (Amendment) (England) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Wednesday 27th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 19 December 2018 and 28 February be approved.

Relevant documents: 13th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee B). Considered in Grand Committee on 25 March.

Motions agreed.

REACH etc. (Amendment etc.) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Tuesday 26th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 5 February be approved.

Relevant documents: 15th and 17th Reports from the Secondary Legislation Scrutiny Committee (Sub-Committee B)

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, these regulations concern the registration, evaluation, authorisation and restriction of chemicals, otherwise known as REACH. These regulations apply to the whole of the UK, with the exception of paragraph 1 of Schedule 11, which makes technical amendments to the England and Wales regulations that transposed the EU directive on the disposal of polychlorinated biphenyls, or PCBs. We have worked with the devolved Administrations on this instrument and, where it relates to devolved matters, they have given their consent.

Our chemicals sector is world leading and one of the UK’s largest manufacturing exporters by value. We fully realise the sector’s economic importance and its importance to the way we all live our lives. At the same time, we also recognise the risks to human health and the environment if chemicals are not used properly. The UK is strongly committed to the effective and safe management of chemicals to protect both the public and the environment. That will not change when we leave. This is why we clearly set out our negotiating position in the White Paper published in July last year.

We want frictionless trade which maintains strong chemicals regulation through a common rulebook for sectors such as chemicals that would be supported by arrangements that cover all relevant compliance activity such as REACH, and continued active participation in the European Chemicals Agency, ECHA, so that UK businesses can continue to register chemical substances directly, rather than working through an EU-based representative.

However, we must also be ready should we leave without a withdrawal deal. The building blocks of REACH will all remain, and we are keeping the fundamental approach of REACH, with its aims of ensuring a high level of protection of human health and the environment, as well as enhancing innovation and competitiveness. This is why we seek a smooth transition and an outcome which minimises friction, disruption and delay at our borders and supports the continued chemical supply chains with the EU.

Delivering day one functionality has been a key priority since 2016. To achieve this, we have been working with both industry and the UK regulators. Since 2016, Defra, in partnership with BEIS and HSE, has run an extensive programme of stakeholder engagement with the chemicals industry with the aim of reaching as wide an audience as possible, particularly targeting SMEs and downstream users of chemicals. This programme included regular ministerial meetings with Ministers from Defra, BEIS and DExEU.

Last summer, we held a series of informal briefings for the chemicals sectors, NGOs and other stakeholders on the proposals contained in the instrument. We followed this up with detailed guidance. Since October, this effort has been even more intense. We have engaged directly with more than 1,700 stakeholders. Building on this, we launched the ongoing business readiness campaign in January to spread coverage to as many businesses as possible. We have used online adverts to promote stakeholder events and both social and traditional media outlets for increased stakeholder engagement. In the last week, my officials have also been in Frankfurt and Brussels to spread the message to EU business.

Concurrently, we have been building the UK REACH IT systems. We have tested this system with more than 100 industry users from UK and international chemicals manufacturers and distributors, the energy sector, aerospace, biotechnology and the automotive sector, agriculture and the cosmetics industry. The system stood up well and we received positive feedback, with industry generally finding it straightforward to use. The positive assessment and feedback from attendees during this exercise means that UK REACH IT will be ready to go live for exit day. It will have the critical functionality to enable industry to register new chemicals and for holders of existing REACH registrations to provide the UK agency with details to verify those registrations.

UK REACH provides for the functions of ECHA to be carried out by the Health and Safety Executive. The HSE will receive industry’s registrations of chemicals and make technical decisions, for example in dossier and substance evaluations, as well as scrutinising authorisation applications and making scientific recommendations on whether to introduce new restrictions. This builds on the HSE’s activities as the competent authority for REACH. The Environment Agency and the devolved environmental regulators will have the role of providing the advice that the HSE will need on environmental matters.

The HSE is ready to act. We are increasing the resources available to it with extra money and extra people. We have done the same for the Environment Agency and for Defra. We have also provided extra resources to both the HSE and the EA to prepare, and we will continue to scale up their resources to £13 million a year at full operation. Appeals against the HSE’s decisions will be heard by the First-tier Tribunal, which is fully independent of the HSE. The tribunal can bring in expert advice so that it can assess the merits of the case.

The SI contains a range of transitional provisions to provide legal certainty to business and to protect supply chains. There will be automatic transfer of existing UK registrations into the UK REACH system. This means that industry needs to do nothing on exit day to be reassured that its registrations will be valid in UK law and there will be no break in its access to the UK market.

Companies will need to provide HSE with the information supporting their registrations in two phases: initial information within 120 days and the full information within two years. No fee will be attached to these requirements. As I have said, industry has tested the IT systems and given them its support.

--- Later in debate ---

[Lord Selkirk of Douglas (Con)]

My Lords, I will be extremely brief. This has been a remarkably good debate, and I strongly congratulate the sub-committee Chairman, the noble Lord, Lord Teverson, the noble Lords, Professor Lord Krebs and Professor Lord Trees, and the noble Viscount, Professor Lord Hanworth, each of whom made extremely relevant and important points. While we were considering this, I was struck by how many are employed in the chemical industry; I understand the figure is far above 50,000. I hope it will be strongly borne in mind that their expertise is absolutely essential for our country, especially when there is the possibility of wide-scale duplication.

The other point I make is that a restriction on the availability of medicines would cause grave concern. I hope that the Minister will exercise a watching brief and that an independent statutory committee will be created, as called for by the noble Lord, Lord Krebs. This will take no more than a lot of hard work, understanding and, if I may say so, openness and transparency.

[Lord Gardiner of Kimble]

My Lords, in this debate noble Lords with considerable experience have made extremely valuable contributions, certainly for me. I also found it immensely valuable having meetings earlier to get abreast of some of the key, essential points that noble Lords have made today.

I reiterate what the noble Lord, Lord Teverson, and my noble friend Lady McIntosh said, as well as the noble Baroness, Lady Bakewell, when talking about Aston Chemicals. I feel confident mentioning the name, as the noble Baroness mentioned it. So many of these businesses are in the small business sector, and how essential it is. I acknowledge the importance of the chemical industry and its contribution. I think we all agree how essential it is to have a regime—we can discuss what would be the optimum regime—where we can all have confidence in the use of chemicals. There have been strong expressions on matters that I entirely respect and understand, but I have a responsibility to your Lordships to say—and these are not just my riding instructions from the other place—that we need this statutory instrument if we are to have an operable system, which the chemical industry acknowledges.

I have counted and I think I may have had 45 to 50 questions. It would be impossible to indulge your Lordships and answer every one in great detail, but I will endeavour to answer as many as I can. The noble Lord, Lord Fox, opened by asking if Her Majesty’s Government—Defra and other departments—are concerned about these matters. I say emphatically yes, for the two reasons I opened with that noble Lords raised. This is a major commercial interest of this country. We also have the great responsibility of ensuring that our country is safe, and indeed that products from our country are safe for others to use.

On IT, the first thing to say is that I could never have invented any of it—so I can safely say that I would not have been in any positon to say whether this will work—but I am assured that for day-one functionality we are ensuring that industry will be able to register new and imported chemicals and to provide authorities with information required for maintaining the validity of existing registrations. Post day one, we will enable joint registrations for industry and build back-end functions for the HSE. I acknowledge what the noble Lord, Lord Fox, the noble Baroness, Lady Bakewell, and my noble friend Lady McIntosh said about IT, but this has been tested with industry and I can only report what I have heard on the success of that testing.

--- Later in debate ---

[Lord Fox]

I was not implying that there was something wrong with the trade association. My point was that it is wrong to hide behind that statement and not acknowledge that there are serious copyright and confidentiality issues around this data which make the whole cut-and-paste exercise much more complex and expensive than the Minister seemed to present.

[Lord Gardiner of Kimble]

I understand the point from the noble Lord. However, as I said in my opening remarks, it is the case that Cefic and other bodies are working extremely constructively, as there is a mutual benefit.

As a prelude to today, I read last Thursday’s Hansard—my noble friend Lady Buscombe was very helpful in taking me through that interesting debate. To be pedantic, let me be clear that the 488 approvals mentioned are part of a programme under the biocidal products regulation and not REACH. All of government is looking in great detail at what needs to be done and what resources are necessary to make sure it happens.

The noble Lord, Lord Krebs, and my noble friend Lady McIntosh asked about the benefits of a UK system. I have said already—and will say again, because the noble Lord, Lord Whitty, raised it—that our preference is obviously to maintain participation in the European Chemicals Agency. That is the Government’s aim, and I will go into further detail on it. However, we are here because we have to consider all eventualities. In his report, the noble Lord, Lord Teverson, made it very clear that although sometimes we do not wish to be in a certain place, we have to do the responsible thing. Indeed, his committee considered how we deal with all scenarios.

The noble Lord, Lord Teverson, also asked how many UK companies have taken advantage of the Brexit window. I do not have any details from the ECHA on that, but if I receive any further information, I will make sure it is passed to the noble Lord.

The noble Lord, Lord Fox, mentioned the duplication of costs. It is the case that, unfortunately, if there is no deal and we have to set up a UK REACH system, or if at the end of the negotiations participation is not possible, we would, as other countries do, have to have a regulatory system. However, I emphasise that, through our transitional measures, we are seeking to minimise the costs; for companies registering new chemicals, the requirements will be the same.

I understand the concerns of business and civil society. That is why we have had such a considerable number of discussions, as I referred to in my opening remarks, with business, all representatives who have an interest and Ministers in BEIS.

I was struck by last Thursday’s intervention from the noble Lord, Lord McKenzie of Luton. He described the Health and Safety Executive as,

“one of the jewels in the crown of our regulatory firmament”,—[Official Report, 21/3/19; col. 1602.]

and said he had no doubt about its intellectual capability. I agree with the noble Lord and with the points made by the noble Lord, Lord Whitty: no other organisation is better placed than the HSE to act as the UK agency.

As I said, we intend to scale-up resources to £13 million at full operation. I say to my noble friend Lady McIntosh that this funding is primarily for human resourcing in Defra, the HSE and the Environment Agency, to make sure that: we have the necessary levels of technical specialist input into risk and socioeconomic assessments of chemicals for the UK; first-rate policy advice can be provided; we can increase engagement with UK businesses and appropriate international fora; and we can take forward legislation as we seek to become a global leader in promoting the sound management of chemicals. As the noble Lord, Lord Teverson, rightly identified, the HSE will at this stage take on about 35 to 40 people. We will have a strong and effective regulator by building on the expertise of the HSE and the Environment Agency to operate REACH in the UK. As for the estimated number of staff, we think we will need 135 full-time equivalents across the three organisations of Defra, the EA and the HSE for the work I have outlined.

The noble Lord, Lord Whitty, raised the matter of independence. As the UK agency, the HSE must also draw on independent expert scientific advice when developing its opinions on restrictions and authorisations. This will add to the robust evidence and analysis underpinning its opinions. If there are reasons the HSE does not commission independent advice—for example, where ECHA has already published a robust opinion on a chemical—it must publish its justification.

The noble Lords, Lord Fox, Lord Teverson and Lord Whitty, raised the potential costs to industry. The instrument puts in place transitional arrangements to provide business continuity. We are bringing all UK registrations automatically into UK REACH, so there is no break in market access. We are making sure that companies can continue to buy chemicals from the EU from day one. Grandfathering means that there will be no break in industry’s duty to identify and apply the appropriate risk management measures in businesses. We will not weaken the “no data, no market” principle because that is fundamental to REACH. But we have engaged closely with industry stakeholders about costs and how to mitigate them. As I said, the UK Chemical Industries Association and Cefic have published their joint recommendation that data used to register under REACH should be available for UK REACH at no extra charge.

On grandfathering, we acknowledge the existing ECHA registrations. That is why we have the grandfathering system and will accept reduced information for the first two years. But that is not a tenable position in the long term if we want to have an effective regulatory system that protects human health and the environment.

A number of noble Lords, particularly the noble Lord, Lord Trees, mentioned animal testing. This instrument preserves the built-in mechanisms to reduce the amount of animal testing. This is the last-resort principle that means that companies and the regulator can turn to animal tests only if they have exhausted all other ways of getting the information they need to complete the understanding of the chemical. There is also the testing proposal mechanism, which means that in many cases industry cannot proceed with animal testing unless it gets the regulator’s agreement first. The UK’s regulations preserve these provisions. Without this instrument, we would not have those powers to stop animal testing.

The UK’s record on these matters is acknowledged internationally, which was mentioned by the noble Lord, Lord Whitty. The UK has been the forefront in ECHA in opposing animal tests where alternative approaches are available. I should say to the noble Lord, Lord Trees, that we will aim to harmonise as much as possible. We will accept existing animal tests produced for EU REACH. We will not ask for new ones. Looking forward, we will work on the basis of mutual acceptance of data and the EU follows the same principle.

The noble Lord, Lord Fox, raised the important issue of environmental protections. The Government have repeatedly made clear their commitment to environmental standards. The policy paper that we published alongside the environment Bill in December last year reinforces the regulatory provisions throughout REACH that are fully preserved in the instrument today.

I also say to the noble Lord, Lord Krebs, that we will continue to need robust scientific evidence to make sure that we are properly protecting human health and the environment. That is why we have put in place strong arrangements for scientific advice. The HSE must seek external knowledge and advice when forming its opinions or otherwise justify why it has decided not to. It must act in a way that ensures a high level of transparency and it must publish its opinions. The HSE will have access to the best advice and will not be limited to the UK or even the EU. Indeed, we think by contrast that a UK statutory committee runs the risk of rather narrower membership and limiting our access to expertise. We are also committed to transparent processes. We will have arrangements in place in UK REACH to allow stakeholders to observe discussions and considerations where independent scientific advice is provided and to read publicly available minutes of these meetings.

The noble Lords, Lord Krebs and Lord Fox, raised divergence. It is the case that industry and NGOs have expressed views on that matter. First, the UK will not diverge from EU regulatory standards, at least not if that means reducing our standards. In other words, that we will retain the highest possible standards is the whole basis of this regulation. We will look very closely at what the EU does, but it is right that our regulators should apply their own judgment based on independent, expert advice on individual chemicals.

Common Organisation of the Markets in Agricultural Products Framework (Miscellaneous Amendments, etc.) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Tuesday 26th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 13 February be approved.

Relevant documents: 18th and 19th Reports from the Secondary Legislation Scrutiny Committee (Sub-Committee A)

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)]

My Lords, I declare my farming interests as set out in the register.

The matters in these instruments are closely interrelated, and I hope that noble Lords might find it helpful if I speak to them together. These instruments amend retained EU law and domestic legislation on the common organisation of the markets in agricultural products—also known as the Common Market Organisation or CMO —to ensure their smooth transition into a domestic regime. They also amend retained EU law and domestic legislation covering a limited number of miscellaneous rules and functions within the wider common agricultural policy.

The CMO is part of Pillar 1 of the common agricultural policy, alongside direct payments. It comprises a number of schemes and standards designed to support, directly or indirectly, farmers and the prices they receive for their goods.

The technical and operability amendments made in these regulations will maintain the effectiveness and continuity of this legislation, which would otherwise be inoperable following exit. They will ensure that we can continue to operate schemes under these regulations for our vital farming sector and maintain the standards they set, which support confidence in our farmed goods in domestic and international markets.

This legislation makes appropriate corrections to ensure that these standards and processes continue to operate in a UK context. Where changes are required, we have endeavoured to ensure that these will have limited impact on businesses and other stakeholders. We have consulted extensively with the devolved Administrations on these instruments to ensure that the legislation that they amend continues to work, while also respecting the devolution agreements.

For six of the instruments, most of the areas they cover are devolved, with powers transferring to devolved Ministers. In many cases the Secretary of State is able to act on behalf of the devolved Administrations, should they give their consent. However, in some circumstances this does not apply to Wales, due to certain provisions that are specific to the Welsh devolution settlement. The Welsh Government have carefully considered whether the Secretary of State should be able to act on their behalf in respect of each of the functions concerned, and the drafting reflects that. Only one relates exclusively to reserved matters: the draft Common Organisation of the Markets in Agricultural Products and Common Agricultural Policy (Miscellaneous Amendments) (EU Exit) Regulations 2019.

The majority of the instruments under debate concern the common organisation of agricultural markets. The CMO sits in Pillar 1 of the CAP and was set up as a means of meeting the latter’s objectives, in particular by stabilising markets, ensuring a fair standard of living for agricultural producers and increasing agricultural productivity. It has over time broadened to provide a range of measures that enable the EU to manage market volatility, incentivise collaboration between and the competitiveness of agricultural producers and facilitate trade.

The first statutory instrument in this group, draft Common Organisation of the Markets in Agricultural Products Framework (Miscellaneous Amendments, etc.) (EU Exit) Regulations 2019, amends retained EU legislation with the purpose of making operable the overarching framework of the CMO, rather than the detailed rules of each of the constituent policies. These amendments are all appropriate to ensure the continued operability of this framework, and include such amendments as those replacing tonnage ceilings for market intervention schemes that apply across the whole EU with a level that is suitable for the UK’s domestic market.

--- Later in debate ---

[Lord Gardiner of Kimble]

My Lords, I am most grateful to all noble Lords who have spoken. Like the noble Lord, Lord Addington, I have the disadvantage of being before my noble friend Lady Byford and the noble Lord, Lord Grantchester, who farm in a much more extensive manner than I do. I reiterate my commitment to the farming world as a farmer.

I thank the noble Lord, Lord Addington, and the noble Lord, Lord Grantchester, for acknowledging government support. I think I have been clear in previous debates—we have had a number of debates on this—about the government commitment to maintain the same level of support until the end of this Parliament, expected in 2022. This is certainly unique. In the European Union, for instance, no other member state’s farming sector has had that level of guarantee. This commitment includes all funding provided for farm support under both pillar 1 and pillar 2 of the current CAP. The noble Lord, Lord Grantchester, may recall from the debate that the point about the RDPE funding is that any agreements under pillar 2 that have already started will continue to be funded by the Treasury under that guarantee, even if they go beyond 2020.

The noble Lord, Lord Addington, asked about change. I entirely agree with the noble Lord, because at a time of change there is always much concern. Sometimes it is not quite as bad as we all imagine. I emphasise that there are no immediate changes for farmers and consumers due to the statutory instruments before us. Indeed, these instruments maintain the status quo, with amendments made to ensure that the existing regulatory regime continues to work properly and to provide a consistent regulatory framework.

I raise two areas where changes have been made. In both cases we have worked to ensure that the impact on farmers, businesses and consumers is minimised. The first is in the labelling of farmed goods, where minor changes are necessary to some labels as UK goods will no longer be able to be identified as EU goods. To allow producers and traders time to adapt and to use up their existing labelling stock and reduce waste, we have pragmatically introduced transition periods for these labelling changes until the end of 2020. Another pragmatic point I mentioned earlier was in the tagging of live bovine animals. Here EU legislation requires the retagging of all live bovine animals imported from third countries. We have exempted animals from the EU from this definition so as not to introduce a new requirement of retagging EU animals when we leave. As I said before, this is because the tags are fully compliant with our IT systems, and we thought that that would prevent unnecessary additional costs. These statutory instruments are absolutely designed to ensure continuity and stability for farmers by maintaining the current CMO and livestock frameworks. I think the noble Lord, Lord Addington, meant the complete range of regulations. On livestock movement, again I assure the noble Lord that there will be no changes on the ground. I reiterate that this livestock movements SI does not introduce new rules or new policies. The rules that livestock keepers and businesses must comply with will be unchanged by this SI.

My noble friend Lady Byford asked a number of questions. If I get all the answers, I will of course report on them. If I do not, it would be much better if I wrote in some detail. My noble friend asked about livestock fee charging and what this entails. There is a power in the retained regulation on cattle ID registration, regulation 1760/2000, to charge for controls in this area. It is not Her Majesty’s Government’s policy to charge for these controls and we have no plans to do so.

My noble friend Lady Byford asked about agricultural promotions and the specific questions raised by the SLSC about funding for agricultural promotions laid out in the Common Organisation of the Markets in Agricultural Products Framework (Miscellaneous Amendments, etc.) (EU Exit) Regulations 2019. The department provided a response and we confirmed to the committee that there is no funding from the Government for the continuation of these multi-programmes after exit until their completion in 2020 and that stakeholders have been informed.

On the question of livestock, the ESIC and SLSC’s sifting committees made similar points suggesting that the changes made by the SI conferred significant new powers on Ministers and provided for charging for cattle ID. As I say, they disagreed with the department’s original Explanatory Memorandum, which described the changes being made by this instrument as minor and technical. They took the view that 20 or so amendments being made by it had the effect of conferring functions on a Minister in their domestic ministerial capacity that EU regulations confer on the UK as a member state. As I said, we have no intention of charging.

My noble friend asked about price reporting. We have made operable the provisions to set up a system for price reporting in the sugar sector. If I have any further information on that, I shall write to my noble friend and provide a copy to all noble Lords who have spoken.

My noble friend asked a question on public intervention and crisis measures. We are retaining these measures, as it is not appropriate to revoke them under the European Union (Withdrawal) Act 2018. However, the economic case for market intervention is weak. In a global trading environment it can achieve its aim of increasing prices only in very specific circumstances. Where it does, there is a cost not only to the taxpayer but to consumers. The Government—I think this is the case across parties—have not historically supported the general use of public intervention and private storage aid in the EU, and the medium-term intention would be to phase out this policy.

My noble friend Lady Byford asked about a safety net and what assistance would be available if there were a crisis. We have already carried out significant no-deal preparations and have contingency plans in place to minimise disruption as much as possible. As part of this, we are in close contact with the devolved Administrations, all farming sectors and farming unions, including the livestock sector, and are looking at a range of possible options if we were to leave without a trade deal.

The noble Lord, Lord Grantchester, raised a number of matters on consultation and assessment. As I think the noble Lord is expecting me to say, there are no changes in policy except in the really limited areas I have described, which are all pragmatic. Where there are changes, they are largely minor and reflect the domestic context. I can say that Defra carried out targeted stakeholder engagement on these policy changes and, as I say, consulted extensively with the devolved Administrations. Where there is a possible impact on businesses, such as with labelling changes, a transition period will be implemented.

I want to take noble Lords back and embellish what I said about multi-programmes. The term refers to programmes that involve multiple member states. I think we all have to accept that there is no reasonable way in which we could make these schemes work domestically, given that they engage a number of other member states. I do not think that the UK’s share of the work and funding is variable. For simple programmes that require the participation of only one member state, as I have said, we have given a Treasury guarantee that they will be fulfilled. However, it would not be possible to operate programmes with multiple member states and so we will not be continuing with those.

[Lord Grantchester]

Can the Minister provide clarity on these multi-programmes? There are obviously implications for UK businesses that partake in those, and I understand the Minister’s remarks on that. However, will he clarify that none of these schemes has implications for government commitments and obligations to fulfil EU schemes as part of the £39 billion transfer of funds? Do they all fall outwith those obligations?

[Lord Gardiner of Kimble]

It is only reasonable that I answer the noble Lord precisely in writing to provide clarity. I would not want to assume the configuration of the £39 billion and whether schemes in this area may be implicated.

On consultation, the approach we have taken to engagement has been proportionate and fair, particularly given that the changes made by the statutory instruments are technical and operable in so many cases. We have worked closely with the farming world.

The noble Lord, Lord Grantchester, asked about the legislative functions SI. These provisions allow the Secretary of State to require export licences for the export of farmed goods. They are necessary to allow the UK to manage any new third-country export quotas that the UK may need to manage. Examples of current export quotas that the EU manages, and that the UK will therefore need to manage, include export quotas for cheese to Canada and the United States and for skimmed milk powder to the Dominican Republic. As I am sure the noble Lord knows, the administration of import tariff quotas will be subject to separate regulations made under the Taxation (Cross-border Trade) Act.

As I have said, Defra has consulted extensively with the devolved Administrations on all aspects of the SIs, and consent was sought and given for those that relate to devolved matters. In so far as the regulations make amendments to food law, we consulted in accordance with our legal obligations through representative bodies such as Dairy UK, the NFU and local councils. We received replies from numerous public bodies and organisations in England, and in all four constituent nations, expressing support for our proposed operability changes.

Where industry bodies requested longer transition periods for labelling, we took that into consideration and increased the length of transition to the end of December 2020.

On the livestock SI, my noble friend Lady Byford, and the noble Lord, Lord Grantchester, with his long-term dairy interest, will be pleased to hear that stakeholders—and I have been part of this—have played a leading role in helping Defra develop the principles and approaches that will underpin the delivery of its planned new livestock tracing services over the next few years, through its traceability design user group. Again, this is really important, and there is enormous buy-in from industry.

Common Organisation of the Markets in Agricultural Products and Common Agricultural Policy (Miscellaneous Amendments) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Tuesday 26th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 14 February be approved.

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee A)

Motion agreed.

Market Measures (Marketing Standards) (Amendment) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Tuesday 26th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 13 February be approved.

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee A)

Motion agreed.

Market Measures Payment Schemes (Amendment) (EU Exit) Regulations 2019

Lord Gardiner of Kimble Excerpts

Tuesday 26th March 2019 Lords Chamber

Moved by

[Lord Gardiner of Kimble]

That the draft Regulations laid before the House on 13 February be approved.

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee A)

Motion agreed.