Draft Road Vehicle Emission Performance Standards (Cars and Vans) (Amendment) (EU Exit) Regulations 2019 Draft Road Vehicles and Non-Road Mobile Machinery (Type-Approval) (Amendment) (EU Exit) Regulations 2019

Debate between Lord Swire and Jesse Norman

Wednesday 27th February 2019 General Committees

[Jesse Norman]

It is a pleasure to serve under your chairmanship, Mr Howarth. As the Committee knows, the Government have a responsibility to be prepared for any scenario on EU exit day and will therefore continue to lay before the House EU exit statutory instruments for a no-deal outcome. If they are no longer required on exit day, we expect to defer, revoke or amend them in time for the end of the implementation period.

As the Department responsible for vehicle regulation, the Department for Transport has conducted intensive work to ensure that there continues to be a functioning legislative framework for this important sector of the economy. Although we strongly believe that leaving with a deal is the best outcome for the UK and the EU, it is our duty to make reasonable preparations for all scenarios. The statutory instruments are an essential part of those preparations, and they will ensure that there continues to be a well-functioning regulatory regime in the UK.

Currently, motor vehicles can be registered and placed on the UK market only if they have a valid EU type approval that demonstrates that they conform to EU standards, including safety and emissions requirements. The legislation governing that is a mix of domestic and directly applicable EU regulations.

The draft type approval regulations will ensure that the Government continue to have control over the registration of vehicles in the UK, while minimising the burden on manufacturers. The regulations were tabled under the negative procedure and considered by the sifting Committees of both Houses, which both recommended that they be upgraded to affirmative, given the potential impact on manufacturers. I thank the Committees for their consideration of these and other statutory instruments.

[Sir Hugo Swire (East Devon) (Con)]

This is an ill-informed question, and I would be grateful for the Minister’s answer. The legislation seems to pertain to cars and light commercial vehicles. Will there be similar legislation relating to lorries, buses, motorcycles and so forth?

[Jesse Norman]

I will come to that issue later, so I will respond to my right hon. Friend then. The most apparently naive questions are always the hardest to answer.

The regulations will require vehicles to be registered using a provisional UK approval, and they allow the Vehicle Certification Agency to issue provisional UK approvals to manufacturers who hold a valid EU type approval without additional costly re-testing. Importantly, the environmental and safety standards to which vehicles will be approved under the UK scheme will remain unchanged from those applicable under the EU regime.

There is a good reason why the UK should not simply accept EU approvals, rather than creating the UK scheme proposed in the regulations. Without the UK scheme, the Government could not act to stop another Volkswagen-type emissions scandal—we could not prevent those vehicles from being put on the road, withdraw approval of them or require additional testing to ensure that they conformed to the applicable standards until the EU had acted on the matter.

The regulations temporarily double the limits for the national small series type approval until the end of 2019. That specific measure reduces the burden of regulation on smaller manufacturers who sell only in the UK market. Many are UK companies that provide essential and sometimes unique vehicles and products to our domestic market.

The regulations are subject to a sunset clause, so they represent an interim arrangement that is valid for a maximum of two years. That allows the additional time required to develop a full UK type approval scheme and to correct the remaining deficiencies in the thousands of pages of technical annexes to the retained EU legislation. We will formally consult on those proposals, and we aim to lay the statutory instrument before the House later this year for Parliament to debate and vote on.

The draft regulations will be made for the most part under the powers conferred by the European Union (Withdrawal) Act 2018. To correct a deficiency in existing UK legislation, the powers conferred by the European Communities Act 1972 will also be used to harmonise the legal definition of type approval certification across the UK. The regulations create a UK approval scheme by amending the Road Traffic Act 1988 in Great Britain and the Road Traffic (Northern Ireland) Order 1981. In addition, the regulations amend the Vehicle Excise and Registration Act 1994 to provide that vehicles entering the UK after exit day can be registered only if they have a UK approval. Further minor amendments are proposed to the Road Vehicle (Approval) Regulations 2009 and to the three retained frameworks for motorcycles, agricultural vehicles and engines for non-road mobile machinery, to ensure that that retained EU legislation remains operable after the UK leaves the EU. The amendments will come into force on exit day, except for the harmonisation of the legal definition of type approval certification across the UK, which will come into force 22 days after the regulations are made.

During the development of the regulations, the Department engaged widely across the automotive sector. We have spoken directly with all the major trade associations—the Society of Motor Manufacturers and Traders, the Motorcycle Industry Association, the Agricultural Engineers Association, as well as those representing specialist manufacturers such as the Wheelchair Accessible Vehicle Converters Association. The meetings have included those who are directly involved in the day-to-day process of type approval, as well as people in managerial roles from manufacturers. Although the industry does not want a no-deal Brexit, it recognises the proposals as a light-touch, pragmatic contingency plan.

I turn to the draft Road Vehicle Emission Performance Standards (Cars and Vans) (Amendment) (EU Exit) Regulations 2019. The existing EU regulations establish mandatory fleet average CO₂ emissions targets for all cars and vans registered in the EU each calendar year. For cars, the target is currently 130 grams of CO₂ per kilometre, and it will reduce to 95 grams in 2020. For vans, the target is 175 grams of CO₂ per kilometre, lowering to 147 grams in 2020. Those requirements have been one of the key drivers towards improving the efficiency of new cars and vans since their introduction.

On the basis of those top-level targets, manufacturers receive individual targets based on a comparison between the average weight of their fleet and the average weight of all relevant vehicles registered in that calendar year. Manufacturers with heavier fleets receive individual targets above the headline target, while those with lighter fleets receive targets below it. As only the manufacturers’ fleet average is regulated, they may sell any vehicle they wish provided that the emissions of their fleet balance out to meet their target. Fines of €95 per vehicle per gram of exceedance are levied on manufacturers that miss their target.

The EU regulation contains a number of provisions that give manufacturers flexibility in delivering their target. Those include derogations, which ease emissions reduction requirements on manufacturers registering fewer than 300,000 cars or 22,000 vans a year; pooling, which allows manufacturers that fall under the same umbrella group to combine their registrations, effectively becoming one manufacturer for the purposes of emissions reduction; eco-innovations, which allow manufacturers to receive credits for technologies that reduce CO₂ on the road, but that are not taken into account during vehicle testing—for example, the use of a solar roof—and super-credits, which provide manufacturers with additional incentives for registering ultra-low emissions vehicles.

The regulations align national policy as closely as possible with the existing EU regulation, providing certainty for industry that its already established business plans will not be affected by the UK leaving the EU. The regulations we are considering also ensure that we meet our long-standing commitment to having a post-EU emissions regime that is at least as ambitious as the current arrangements, and they provide the framework for the Government to assume the obligations and functions of the European Commission under the existing EU regulation. That can best be summarised by explaining that these regulations retain the target-setting approach and formulae establishing individual targets, as is already the case under EU law, but they will apply only to cars and vans that have been newly registered in the UK after exit day.

The related provisions that I have outlined—for example, the derogations and pooling provisions—are also amended by the regulations to make sure that those provisions will work sensibly in the UK context while maintaining existing standards. All minor deficiencies have also been corrected as appropriate—for example, by replacing “Commission” with “Secretary of State”. Six related delegated regulations and 25 implementing decisions that will be retained are also amended by this statutory instrument to ensure their continued function in the UK. The amendments will come into force on exit day.

Legislation on CO₂ targets does not directly exist in the EU at present, so the targets are for vans and cars only. Provisions on the monitoring and reporting of data from heavy goods vehicles have been laid before the House in a separate statutory instrument.

Although we want a deal that recognises the equivalence of UK and EU type approval schemes, the changes made in the type approval regulations and the new car and van CO₂ emissions standards regulations will ensure that we retain control of the registration of vehicles; that we maintain continuity of vehicle approvals and emissions; that we minimise costs to industry; and that the legal framework continues to work after the UK’s withdrawal from the European Union, while maintaining the Government’s commitment, set out in the strategy “The Road to Zero”, to

“a future approach as we leave the European Union that is at least as ambitious as the current arrangements for vehicle emissions regulation.”

I hope colleagues will join me in supporting the regulations, and I commend them to the Committee.

Automated and Electric Vehicles Bill

Debate between Lord Swire and Jesse Norman

3rd reading: House of Commons & Programme motion: House of Commons & Report stage: House of Commons
Monday 29th January 2018 Commons Chamber

[Jesse Norman]

I certainly agree that consistency in the presentation of information is important, and I take my right hon. Friend’s wider point about whether such information should be displayed in the same way as petrol prices. He makes a valuable contribution to the debate.

[Sir Hugo Swire (East Devon) (Con)]

One of the most frustrating aspects of filling up a car is the tax on top of the cost of the fuel itself. Do the Government have any intention to levy any form of taxation on electricity bought at petrol stations?

[Jesse Norman]

My right hon. Friend will be aware that we have already wandered quite far outside these narrowly defined amendments to a tightly defined Bill. I am not going to comment on future Government policy.