Tobacco and Vapes Bill

Earl Howe Excerpts

Committee stage
Tuesday 11th November 2025 Grand Committee

[Baroness Walmsley (LD)]

My Lords, I will speak to my Amendments 81 and 83, but as this is Committee I also note the virtues of Amendment 89 from the noble Lord, Lord Lansley. We will soon find out which one the Minister prefers, if either of them.

My amendments would ensure that the money from the fixed penalty notices goes to the local authority to pay for public health initiatives determined by the authority. As the Committee knows, local authorities are very hard up. Indeed, some are going into administration. I know from my work on food and health that the public health grant is stretched to breaking point for obesity services, let alone all the other services that we are talking about, such as smoking quitting services. All that makes the burden assessment, mentioned by the noble Lord, Lord Lansley, very important, so I too would be interested to hear where it is.

Although I hope that the level of compliance with the new laws will be high, so that there is no need for too many fixed penalty notices, I believe there is virtue in the idea that such fines should support smoking cessation services. I am afraid that at the moment there is limited access to these services. As I have said before, young people who wish to stop vaping also complain of a lack of services to help them to do so. One would hope that what I should perhaps call the traffic warden syndrome, mentioned by the noble Lord, Lord Bourne, would not happen—but, of course, if people are breaking the law, they will need to pay the penalty. One would not want small businesses to be overburdened by constant vigilance on that score.

However, if the Minister were minded to accept one of my noble friend Lord Russell’s amendments in another group, on a levy on the profits of tobacco companies to support the NHS and smoking cessation services, that might be even better because it would raise a lot more money, which could be spent on cessation and prevention. That is the subject of a different discussion.

Why is the additional government funding for trading standards not enough? Is it enough or not? Perhaps the proceeds of fixed penalties should go to enforcement, rather than helping people to quit smoking and vaping. Prevention is always better and cheaper than cure and enforcement.

[Earl Howe (Con)]

My Lords, taken together, this group of amendments focuses on the question of how the new fixed penalty notice regime will operate in practice, how enforcement will be resourced and how local authorities will be supported in carrying out their duties under the Bill. Those are all important themes.

Amendment 74 in the name of my noble friend Lord Udny-Lister proposes a stepped approach to fixed penalty notices reflecting the number of times a person has been issued with a notice. That makes a lot of sense to me. The first time somebody commits an offence should surely be treated differently from the fourth or fifth time. I hope that enforcement officials will want to do this anyway, but such an approach would help strike a balance between giving people the benefit of the doubt—particularly as this will be, at the beginning, a complex new framework of rules—and ensuring that repeated non-compliance is dealt with properly.

That spirit of proportion and fairness also underpins Amendment 77, which would give local enforcement authorities the discretion to issue a formal warning notice to first-time offenders in lieu of a fixed penalty. I hope that the Minister will recognise the constructive intent behind both proposals.

I turn to the series of amendments tabled by my noble friend Lord Lansley, which seek to ensure that the proceeds of fixed penalty notices arising from offences under Clauses 17 and 20 are used to support trading standards teams directly, rather than being absorbed into the Consolidated Fund. Like my noble friend, I can see no real reason why the proceeds of fixed penalty notices arising from those breaches should not be treated in exactly the same way as the proceeds of other fixed penalty notices or fines. Trading standards officers are at the forefront of enforcing the Bill’s provisions.

There is, perhaps, a debate to be had about whether hypothecation along those lines creates an incentive for enforcement officers not to exercise the kind of discretion favoured by my noble friend Lord Udny-Lister. However—I admit that this is entirely guesswork on my part; I hope the Minister can illuminate us further— I do not think we should expect the yield from fixed penalty notices to be all that great in the scheme of things. This means that the incentive for overzealousness is likely to be more theoretical than real, so on balance I can identify with my noble friend’s argument that the resources generated by enforcement officers through their activity should be reinvested to strengthen their own capacity.

Amendments 81 and 83 from the noble Baroness, Lady Walmsley, would instead direct the revenue from fixed penalty notices towards local public health projects. This idea has considerable merit. There are some practical considerations because such a funding stream would, by definition, be inherently unreliable—and, in the context of a local authority budget, it would probably be very small beer—but, in any case, as the noble Baroness said, we hope that the number of penalty notices issued under this part of the Bill will start at a low level then decline even further as we go along.

Nevertheless, the noble Baroness asked an important question about how enforcement and public health objectives can be more closely aligned. I would be grateful if the Minister could set out how the Government see the relationship between enforcement activity and public health outcomes—specifically, how enforcement might be used not only to punish but to deter and to prevent the behaviours that lead to such offences in the first place. If the Minister can convincingly join the dots, as it were, I will have a better basis for assessing the merits of the noble Baroness’s amendment.

Finally, I turn to Amendment 204 tabled by my noble friend Lord Udny-Lister. This is a welcome and sensible amendment. It highlights the central role of local authorities in delivering and enforcing the provisions of the Bill. It is no secret that local authorities are already under significant financial strain, as has been said, and yet this Bill leans heavily on them for its success. I think it is fair that they are given certainty that the additional duties and regulations imposed on them will not leave them further out of pocket. With that, I look forward to what the Minister has to say.

[The Parliamentary Under-Secretary of State, Department of Health and Social Care (Baroness Merron) (Lab)]

My Lords, I am very grateful for the debate we have had on this group of amendments, which address the issues relating to penalties and enforcement of the Bill. Let me start with Amendments 74 and 77 in the name of the noble Lord, Lord Udny-Lister, which relate to penalties. I understand the noble Lord’s interest in providing tougher deterrents for repeat offenders and in taking a proportionate approach to first-time offenders in relation to certain measures in the Bill. However, I feel that the Bill already strikes the balance in this regard and has taken this into account.

The noble Earl, Lord Howe, and the noble Baroness, Lady Walmsley, made some good points about fixed penalty notices and their literal value. I can agree with the noble Lord, Lord Johnson, that we have focused, as we did on an early group, on supporting those who carry out their business legally and correctly, which is most people. We want to make that possible and streamlined, and we want to crack down on the illegal. This brings us to the point about how in an ideal world we would not be seeing fixed penalty notices because everyone would be playing by the rules. That is an ambition, but what I am trying to say is that it will not be a good measure if we are issuing so many fixed penalty notices without a decline. I think that is what noble Lords are saying, and I certainly share that view. I think that is a very helpful and practical point about how we see the proceeds from fixed penalty notices.

When enforcing tobacco and vape legislation, local trading standards already take a proportionate approach. They choose appropriate action to achieve compliance, and in many cases this already involves the issuing of warning notices, which can be effective in achieving compliance without the need to escalate to harsher penalties. Enforcement authorities will continue to use warning notices where appropriate.

Amendment 74 would increase the values of fixed penalty notices introduced by the Bill, with the highest penalties for repeat offenders. I understand why the noble Lord is putting that forward. The Bill is introducing fixed penalty notices in England and Wales to complement our existing sanctions and to strengthen what is already available to trading standards officers. I know noble Lords are aware—I hope it is obvious, but it is worth restating—that we have been in close conversation and will continue to be so to ensure that any concerns or points that trading standards officers wish to raise in respect of the Bill are heard.

On the point about complementing existing sanctions and strengthening the toolkit that is already available, that is something that trading standards has called for, because it wants to be able to take swift action, as we all want it to, to fine rogue retailers that breach certain regulations. Setting the fine at £200 is believed to be proportionate and the most popular level for the penalty that came through in the 2023 consultation on creating a smoke-free generation. It is also in line with the current fixed penalty notices in Scotland and is similar to the situation in Northern Ireland.

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[Baroness Walmsley (LD)]

My Lords, we have had a great debate. Those noble Lords who know me know that, like the noble Lord, Lord Bethell, I am a great supporter of this Bill, and I would not want to do anything to weaken it. Noble Lords who know me also know that I am a great supporter of evidence-based policy. I therefore looked very carefully and thoughtfully at this group of amendments, and asked myself a number of questions.

First, would this group of amendments interfere with the principal core objective of the Bill, which is to deter young people from smoking highly addictive tobacco products and achieve a smoke-free generation? This is a desirable objective both for the physical, mental and financial health of the individual and for the cost to the NHS and overall economy, which affects all of us as taxpayers. I concluded that, in one case, these amendments would affect the core objective of the Bill, and that is the case of snuff. I am very sorry that the noble Earl, Lord Lindsay, has included snuff along with handmade tobacco. My noble friend Lord Russell has already outlined the evidence that snuff is a problem for young people, and it can be very dangerous.

I also concluded that, on the basis of the evidence currently available to me, these amendments are unlikely to affect that objective, because of the very high cost of cigars compared with other tobacco products. But we need to be careful, as the noble Lord, Lord Bethell, just outlined, about the unintended consequences of any exemption because the tobacco industry is very clever and driven by high profits. There is some evidence that, albeit not harmless, cigars have less effect on health than other tobacco products, as they are not inhaled, have no additives and therefore are probably less addictive and certainly smoked less frequently than cigarettes.

I am a fan of evidence-based policy, but I am also a fan of fairness, so I asked myself: is the legislation fair in this respect? I thought initially about small retailers that sell cigarettes, vapes and many other products. Under the terms of the Bill, they will have to adjust their business plans gradually, over many years, to account for the loss of one potential year’s cohort of young smokers to whom they will no longer be legally able to sell cigarettes. That adjustment and time period are not unreasonable and that is what the Bill does.

However, there is one group of small retailers that claim they would lose their business entirely with no gradual adjustment if the Bill is not amended. They are the sellers of exclusive handmade cigars. I have never smoked a cigar in my life, but I am concerned about all small retailers and about fairness. This is because we are told that the nature of the global market, of which the UK is only 2%, is such that they would not be able to comply with packaging regulations.

I then asked myself if it is fair to existing smokers. The Bill is considerate to existing smokers of cigarettes, currently over 18, who are addicted to cigarettes and who will be able to continue smoking them until they die if they really need to. Of course, we need to help more of them to quit, as so many want to do. But is it fair to smokers of cigars? If the sector briefing is correct, they will not be able to buy compliant cigars in this country once the Bill is passed. I asked myself if that is fair to them.

I then asked myself whether exempting cigars from the legislation would create a loophole and encourage young people to switch from cigarettes, vapes and all the other much cheaper forms of nicotine-delivering mechanisms to cigars, which cost over £20 per unit. I think this is very unlikely. There is also the potential of people moving to cigarillos, as has just been mentioned by the noble Lord, Lord Bethell, so any exemption would have to be carefully drafted. Actually, Amendment 104 is quite carefully drafted, apart from my criticism about the inclusion of snuff. Something very similar would need to be drafted to avoid the industry using it to lure young people into smoking.

Lastly, I asked myself what the evidence is to include handmade cigars in the scope of the Bill. As I understand it, the evidence is based on a single study that lumped together a large group of non-cigarette tobacco products, all of which are very different from each other. This has been mentioned in the debate. Lumping them together like that, without the desirable granularity of getting evidence about each individual type of product, resulted in evidence of increased usage. We know that there is a rise in use of tobacco pouches and heated tobacco among young people, but what about cigars? Is there any evidence that young people are increasingly smoking them? I have not seen any up to this point, so perhaps the Minister can point us to the evidence that young people start smoking by using cigars and that the incidence of them doing so is rising or that they report an intention of turning to cigars if they cannot legally get hold of cigarettes.

In the light of all that, I think the Government need to show that they have taken evidence from specialist cigar retailers and their customers about all the issues that I have just mentioned. The Minister has frequently told us that her team has talked a lot to small retailers and their industry representatives, and I know she has done so when it comes to small corner shops that sell a variety of different nicotine-delivery mechanisms. So could she give us chapter and verse on when and how frequently her team have spoken to this particular and rather different group of small retailers? If she and her team do so, they may be open to the suggestion that further consultation and evidence on this issue is required, possibly followed by a careful and watertight exemption from parts of the Bill—if the evidence is there.

[Earl Howe (Con)]

My Lords, the amendments in this group speak to a set of principles that my noble friend Lord Kamall and I have emphasised throughout our scrutiny of the Bill: namely, that the policies set out in legislation should reflect its core purpose, but that unintended consequences that do disproportionate damage should be avoided. We can avoid those consequences by adopting policies that take account of the facts not just in one policy dimension but in all other relevant dimensions—in other words, as my noble friend Lord Lindsay put it, policies that are truly evidence based.

My many noble friends, together with the noble Baronesses, Lady Hoey, Lady Fox and Lady Walmsley, and the noble Lord, Lord Mendelsohn, have made the case—in my view, a convincing one—that, when it comes to those tobacco products that occupy what is, by any measure, a niche position in the marketplace, most especially handmade Havana cigars, a much wider set of considerations should be factored into policy-making than those that apply to the vast generality of tobacco products, such as cigarettes, which are both mass produced and mass consumed.

Handmade cigars are a world away from what we typically refer to as the tobacco industry. As someone who was a Health Minister for a full five-year Parliament, I know how difficult a proposition that is for Health Ministers to accept. The Department of Health and Social Care rightly sees it as its function to preach the ills of tobacco in all its forms and to take every possible step to constrain the demand for tobacco products for the good of patients and the public. I completely understand that.

As a Minister, I was proud to take through Parliament the measures proposed by my noble friend Lord Lansley that mandated plain packaging for cigarettes, and as an opposition spokesman I supported the policy of the last Labour Government to ban smoking in the workplace. I need no persuading about the damage to health caused by both active and passive smoking. However, I have also been consistent in acknowledging that there are one or two narrow areas of tobacco regulation—

[The Deputy Chairman of Committees (Baroness Fookes) (Con)]

My Lords, there is a Division in the Chamber, in which case we would normally adjourn for 10 minutes. If it seems that there are back-to-back Divisions, I think it would be more suitable to come back when it appears that they are over.

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[The Deputy Chairman of Committees (Lord Faulkner of Worcester) (Lab)]

My Lords, we are debating Amendment 102 to Clause 45, and the noble Earl, Lord Howe, was in full flow.

[Earl Howe (Con)]

My Lords, I need no persuading about the damage to health caused by both active and passive smoking. However, throughout my years in dealing with health matters, I have also been consistent in acknowledging that there are one or two narrow areas of tobacco regulation in which the health gain to be derived from such regulation is outweighed by considerations of personal choice, commercial freedoms and—not to sound too high-flown—the national interest.

Handmade cigars are one such instance; I would venture to say that they are the most important one. There is, therefore, a necessary challenge that must be made to the Government—a challenge issued by my noble friend Lord Lindsay in his excellent speech. The challenge is to demonstrate evidence that the strictures that apply to cigarettes apply equally to every single type of tobacco product when consumed. These include heated tobacco, which is a relatively novel product but could have a role in smoking cessation—we do not know that yet, but it might—snuff, pipe tobacco and, in particular, hand-rolled cigars.

Noble Lords have articulated why this challenge must be made. I want to distil those arguments by focusing, as others have done, on handmade cigars. For official statistical purposes, sales of handmade cigars are lumped in with the sale of a whole range of other tobacco products—a fact that precludes any detailed analysis of the market relating to handmade cigars on their own. In the UK, that market is tiny by comparison to the market in cigarettes, but it is a market of very high value. Depending on its age and provenance, one box of Havana cigars can sell for many thousands of pounds. Retail outlets for such cigars are very few in number, but their combined activity is enough to make the UK one of the leading centres in the world for high-quality cigars imported from Caribbean countries. The historical links between British importers and retailers and small producers in those countries go back many years, making it a trade that is the polar opposite of that associated with cigarettes. I should add that highly specialised retailers of handmade cigars in this country are one of the many reasons why very rich people from around the world see London as a destination of choice.

However, relevant as they are, these arguments around the market tell only half the story when it comes to considering this legislation. We need to be clear about the facts relating to health. Hand-rolled cigars, costing hundreds of pounds apiece, are decidedly not a cause of young people taking up smoking, nor is doing so a route to addiction for those who choose to smoke such cigars. Very few people would think of smoking them with anywhere near the same frequency as smoking cigarettes; that just does not happen.

In general, cigars of this kind are bought as luxury items for occasional enjoyment, the main attraction being their unique tobacco flavour. I am not for a minute suggesting that handmade cigars are without any health risk whatever—that would be absurd—but there is a distinct difference between the dangers posed by cigarettes, which have all sorts of carcinogenic chemicals added to them during the course of their manufacture, and the dangers of a hand-rolled cigar, which consists of pure tobacco and whose smoke is not inhaled.

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[Lord Sharpe of Epsom (Con)]

My Lords, I will speak very briefly to my noble friend’s Amendment 114A. First, I apologise profusely for not being here in time to speak to my amendments in the last group. I feel doubly guilty about that because I am going to pick up on something the Minister said in answer to the fact I was not here.

With regard to heated tobacco products, I believe the Minister said that they are harmful. However, there is no conclusive evidence of this; as my noble friend Lord Jackson pointed out, they are a cessation product and therefore ought to be materially less harmful. The fact is that the WHO also acknowledges—or rather assumes—that they will be harmful, but it does not have any conclusive evidence to that point. Can the Minister elaborate a little on where that evidence comes from?

As regards Amendment 114C, I think we should continue to conduct impact assessments. I reject the Liberal argument, which seems, as far as I can ascertain, to be that you should not have a consultation with people you do not like because you might not like their answers. That does not strike me as much of a consultation.

I have little else to say, but I apologise again, particularly for picking up on the Minister, who did not have to answer my amendments—that is a bit of a cheap shot, and I apologise.

[Earl Howe (Con)]

My Lords, in Amendment 114A, my noble friend Lord Jackson of Peterborough rightly highlighted the need for any regulations in this part of the Bill to be underpinned by evidence drawn from the real-world experience of retailers, manufacturers and consumers. It is a point very well made, and I hope that, even if the Minister has an issue about consulting tobacco manufacturers, which I expect she will say she does, she will see the good sense of consulting others in the supply chain to make sure that the regulations stand the best chance of being fit for purpose and avoid unintended adverse consequences.

My noble friend Lord Jackson focused much of his speech on heated tobacco, as did my noble friend Lord Sharpe of Epsom just now. One of the other main concerns about regulation, which we have already touched on in an earlier debate, is the cost of the licence fee for a small business alongside the administrative burden for existing businesses to transition across to the new system. It is important that local authorities allow enough time for applications to be considered and processed and for the operational challenges faced by retailers implementing the system to be addressed. Both retailers and consumers need to be made aware of the new regulatory regime well before it goes live.

The noble Baroness, Lady Fox, amplified that proposal in her Amendment 114C by focusing specifically on the socioeconomic impact of the generational ban on retailers. She is absolutely right to be concerned about that, but I would like to talk about a different strand of the argument from that which she focused on.

In the consultation exercise conducted two years ago by the last Government, the Association of Convenience Stores, which represents more than 50,000 retail outlets across the UK, did not object to the generational ban as a policy. However, when the current Government published this Bill, shop owners expressed immediate concern about the powers contained in it around the licensing system. The biggest worry for them is the power given to a local authority to take a decision to refuse the granting of a licence to sell tobacco and vapes based on the density of other businesses operating in a specific area, or because of that business’s proximity to a school.

We debated this issue briefly last week, but the worry persists on what the effect of these provisions will be. First and foremost, how will this affect existing businesses? Might a well-established retailer selling tobacco and vapes suddenly find that it can no longer do so? Might a new business wishing to set up in a particular area be denied that ability? The ACS has rightly asked what the evidential framework will be for deciding that the density of outlets is too high. How will the threshold be set, and how can fairness be achieved between businesses in an urban area compared to those located in rural areas? Will small shops be treated in the same way as large shops? We simply do not have answers to those questions—and they are questions that are particularly pertinent to small, family-run businesses operating on sometimes tight margins. When will guidance be published to provide the answers? If the Minister cannot reply in detail today, I shall be very grateful if she would do so in writing between now and Report.

Finally, my noble friend Lord Johnson of Lainston has raised an important issue around the need for transitional provisions covering specialist tobacconists located in Northern Ireland. We will be debating specialist tobacconists more broadly in a later group of amendments, and I do not propose to anticipate that debate now. However, in the light of what my noble friend has said, it would be helpful to hear from the Minister whether she agrees that there is a strong case for what are commonly called grandfather rights for these particular specialist outlets.

[Baroness Merron (Lab)]

I am most grateful to noble Lords for this group of amendments and the contributions to the debate. I am grateful for the support of the noble Baroness, Lady Northover, and thank her for that.

The noble Lord, Lord Jackson, who has tabled the amendment, and the noble Baroness, Lady Fox, who has tabled Amendment 114C, I hope will be pleased to hear that I absolutely agree with the premise of their amendments. I have been consistent on this. It is crucial that the Government carefully consider the impact of any legislation and carry out appropriate consultation. That is why in 2023, a UK-wide consultation, which the noble Earl, Lord Howe, referred to, was published on creating a smoke-free generation. It is also why this Government, as I mentioned in the earlier group, completed and published an impact assessment for the Bill, which was deemed fit for purpose by the Regulatory Policy Committee, and this included the impact that this policy will have on retailers. Indeed, that is important.

However, I can also confirm that we will consult, in compliance with our statutory obligations under this Bill, before making regulations under Part 1 implementing significant policy changes. For example, Clauses 13 and 14, relating to the in-store displays of relevant products, already contain a duty to consult, and impact assessments will be conducted for future regulations, as required. I also want to reassure noble Lords, as I have done previously, that we regularly engage with retailers and enforcement agencies, and remain committed to supporting retailers in the implementation of new requirements. We will, as requested, provide appropriate guidance to aid this transition.

The noble Lords, Lord Jackson and Lord Sharpe, raised questions about heated tobacco being in scope. To that I say that laboratory studies show evidence of toxicity from heated tobacco. As I mentioned in the previous group, like other forms of tobacco, the aerosol generated by heated tobacco devices contains carcinogenic compounds. There is very limited evidence that this is effective for smoking cessation. I am glad to hear of the interest in smoking cessation but, clearly, we have other products that are evidenced as working rather more definitely.

The noble Lord, Lord Jackson, and the noble Baroness, Lady Fox, raised points about the illicit market. Let me say to that point that history shows that when we have introduced targeted tobacco control measures, they have had a positive impact on tackling the problems of illicit tobacco. For example, when the age of sale was raised from 16 to 18 in 2007, the number of illicit cigarettes consumed fell by 25% from 10 billion in 2005-6 to 7.5 billion in 2007-8. Most of the evidence that suggests that heated tobacco products are somehow less harmful than smoke tobacco is not independent and often comes from the manufacturers themselves.