Draft International Road Transport Permits (EU Exit) Regulations 2018 Draft Trailer Registration Regulations 2018

Alan Brown Excerpts

Tuesday 6th November 2018 General Committees

[Jesse Norman]

It is a pleasure to serve under your chairmanship, Mr Hanson. These draft instruments were laid on 13 September and 9 October, following extensive industry engagement and consultation throughout the past year. The instruments collectively implement the proposals outlined during the passage of the Haulage Permits and Trailer Registration Act 2018, which I was pleased to guide through this place earlier in the year.

The road haulage sector plays an integral role in keeping our economy moving and in enabling businesses throughout the UK to trade with our international partners in the European Union and beyond. In 2017, the UK haulage sector moved more than 7.8 million tonnes of goods internationally. This is a crucial industry to the wider economy, and that has underlined the Government’s focus on putting in place the necessary arrangements for after we leave the EU in March 2019. I hope Members will allow me the opportunity to share an overview of these instruments and how they work collectively for the sector.

The International Road Transport Permits (EU Exit) Regulations 2018 will establish the framework and systems for the effective administration of a permit system. From November 2018, this regime will cater for our existing permit arrangements with non-EU countries and European Conference of Ministers of Transport permits. From exit day, in the absence of a deal, the regime will cater for existing permit arrangements with EU member states, which are currently covered by EU law. The system will also be the basis for any future permitting arrangement that may arise from our negotiations with the EU.

As the Committee will know, in our negotiations with the EU we are seeking reciprocal arrangements on road haulage. The current arrangements work well for the haulage sector in the UK and for hauliers in continental Europe. This has underlined our intention to seek mutual recognition of international operating licences and access arrangements that do not restrict the current levels of trade.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Will the Minister confirm how extensive the talks have been on reciprocal arrangements and where they are at? Just last week, we discovered that the Secretary of State has not begun discussions on aviation agreements. I hope that those on haulage are further ahead.

[Jesse Norman]

As the hon. Gentleman will know, we undertook a consultation before the draft regulations were introduced. Before framing the original legislation there was widespread discussion with industry bodies and other organisations relating both to haulage permits and to trailer registration. I am therefore comfortable that we have covered all of the bases as regards this area of road haulage.

[Alan Brown]

The key point is where these discussions regarding reciprocal arrangements are at with the EU, rather than discussions with the UK industry. I am asking about the EU.

[Jesse Norman]

I am grateful for the correction. As the hon. Gentleman will know, discussions with the EU are being handled through No. 10 and the Department for Exiting the European Union. We are not in a position to comment on the specific details of any of those discussions at the moment, beyond the facts that we are making progress and envisage a deal that will be thoroughly in the interests of the UK and which will permit haulage to flow in as liberal a way as we would like. As the Committee will know, we have made ample arrangements for different forms of contingency in the event that that should not be the case.

Members will be minded to agree that it is appropriate for the Government to prepare for all possible outcomes of our negotiations, including the prospect of no deal. As outlined in the technical notice on road haulage, in the event of no deal, hauliers will be able to use ECMT permits. In addition, we will seek to use existing bilateral agreements concluded prior to one or other of the parties joining the EU. There are 20 such agreements with EU countries—which the Government expect to be reinstated once EU law ceases to apply—some of which require permits and others that do not. Where necessary we will conclude new arrangements where there is no existing bilateral agreement. Clearly, existing agreements may need to be updated, but in any event we expect to have these arrangements, if required, in place to allow international road haulage to continue after exit day.

The draft regulations implement a permit scheme as it would operate on exit day if no new agreements are reached with the EU or member states. That will enable some continuity of road transport services in the event of no deal. Where new agreements are reached with the EU, or with individual member states that will require permits, amending regulations will be made to reflect the terms of such agreements.

The draft regulations place a prohibition on undertaking international journeys without a permit where an international agreement requires one. It is important to note that these draft regulations by no means require the implementation of a permit regime with the EU or for any other international journeys. Rather, should an international agreement require that a permit is held by the operator and carried on the vehicle in question, the draft regulations allow that permit to be issued. Journeys that do not require permits are not within the scope of the draft regulations.

The draft regulations provide for how to make an application and how the Secretary of State will determine which applicants are allocated a permit where the number of permits available is limited. They set out matters that the Secretary of State must take into account when making a determination, which are designed to deliver the greatest economic benefit from the permits, protect the interests of UK hauliers, and apply a fair and consistent allocation process. That focuses primarily on how frequently a permit will be used and the proportion of an operator’s haulage that is international. The draft regulations provide some discretion in those criteria, so that there is sufficient flexibility to respond to changing demands and ensure that permits are allocated fairly, but they require the Secretary of State to provide guidance on the process to ensure that it is transparent for applicants. That guidance has been provided ahead of this debate. The circumstances in which a permit may be cancelled and the process for appealing the cancellation of a permit are also covered.

[Alan Brown]

When the 2018 Act was being debated we were assured that there were enough permits to go around and to meet current demand. Is that still the case? A scoring system has been outlined, and a limited number of permits suggests that not all applicants will be able to get a permit. What is that going to look like?

[Jesse Norman]

I think the hon. Gentleman may have misread or misheard the main debate, because there has always been a possibility that there would not be enough ECMT permits to go around. That is why there are elements for a fair allocation, even in that contingency. The point I have just made is that bilateral agreements also exist to provide further reassurance. As I have said, though, we do expect a liberalised deal to be in place before then.

--- Later in debate ---

[Alan Brown]

It is a pleasure to serve under your chairmanship, Mr Hanson. I will be brief. I appreciate that there is an argument for the necessity of this proposed legislation. There were no votes on Second and Third Reading of the Bill, so it makes sense to follow through with these measures.

Any idea, however, that this gets the UK ready for no deal is completely fanciful. Given that this is a small drop in the ocean of the actual registration required, the UK Government are kidding themselves. In his opening remarks, the Minister spoke of hoping to have a reciprocal arrangement, but he was not able to update us on negotiations with the EU. The UK is doing one thing and hoping that the EU comes into line and offers a reciprocal agreement.

I referred earlier to an aviation agreement. That is really important because for two years the Secretary of State for Transport told us that an agreement was imminent on aviation and the single aviation market, but just last week we discovered that talks with the EU have not even begun. That really concerns me with regard to preparation for a no deal.

On the haulage permit application process, I have concerns, as I touched on in my intervention, about the mood music around whether there will be enough permits and how they will be allocated. As the hon. Member for York Central has said, the element of random criteria causes real concern. I do not understand how that is deemed to be fair, if part of that random process is to allocate permits to the highest point scorers in a given category. If there are highest point scorers for the hauliers deemed the most important in a given sector, how is it possible to introduce that random factor? It makes no sense.

I hope the Minister will also tell us more about the engagement with the different bodies in the road haulage sector. What discussions have there been about how the application process will work? Will all the responsibility be on the hauliers? Will the Government make positive moves to contact interested parties, so that they understand the process they will have to go through and what it means for them? It is fine to print a document on a website saying, “Here is the new process”, but the most important thing is to get those who require the permits to understand the process, including how it will work and the timing involved. They will have to apply for these permits, so they must understand the Government’s process and how the random element will work and what it means for them.

What would it mean if a lot of hauliers decided not to pick a category but to go for none or more? What would that mean for the Government’s overall assessment of the allocation of permits? Although we hear that the Government are ready for no deal, we are a long way from that, if truth be told.

--- Later in debate ---

[Jesse Norman]

That is an ingenious but verbal distinction. In this case, there may be circumstances in which emergency loads need to be carried, and the Secretary of State has the discretion afforded under this legislation to allow him—or, in due course, possibly her—to make an allocation on that basis. That is in exceptional circumstances; we expect that provision to be rarely used. In the application process for permits as they stand, it is an automated matter, using the criteria that we have described and set out, very helpfully in detail, in the “Guidance on Determining Permit Allocations”.

Let me turn now to the issue of trailer safety, which the hon. Lady has rightly raised.

[Alan Brown]

I thank the Minister for giving way before he moves on. I asked this question earlier: will the Government contact individual companies or bodies directly about this, or will it be left to individual companies to find out and then apply?

[Jesse Norman]

These measures have been very widely published. The hauliers’ associations are very well briefed on the matter. How freight will continue after 29 March has been a topic of national discussion and interest. Therefore, we expect people to be very well briefed. I will also keep the matter under review, but we certainly expect people who are potentially at risk because they have to take international journeys or make international transfers to be aware of these rules and to act on them.