Product Regulation and Metrology Bill [HL]

Lord Leong Excerpts

2nd reading
Tuesday 8th October 2024 Lords Chamber

Moved by

[Lord Leong]

That the Bill be now read a second time.

[Lord Leong (Lab)]

My Lords, it is a pleasure to open this debate. Safety and effective regulation lie at the heart of this legislation. Whether you place an online order for a new toaster or your business is investing in a new piece of machinery, you should have confidence that what you are buying is safe. At least 300,000 UK businesses, with an estimated market turnover of £490 billion, are affected by existing regulations, which are a critical element of the UK’s business and consumer landscape. As we embrace the opportunities of the digital age and exciting new technological advances, it is clear that the products we buy and the way we buy them are changing. It is only right that the rules and regulations that keep people safe and enable businesses to trade effectively are updated too.

This Bill will underpin the UK’s position at the forefront of international trade and enable the recognition of EU product requirements where it is in the UK’s interests to do so. It supports consumers, businesses and economic growth. However, we have to be honest with ourselves in saying that current outdated product and metrology regulations hinder more than help these ambitions. That is why it is now essential to update our framework and future-proof it to meet the challenges ahead.

Historically, the majority of the UK’s product regulation and metrology framework was managed through EU law. From EU exit until the present, the UK Government simply did not have the powers to regulate these areas effectively or efficiently, which is why we are bringing forward legislation now, so we can respond to anticipated changes in the global regulatory landscape next year.

The Bill will preserve the UK’s status as a global leader in product regulation, supporting businesses and protecting consumers. It will ensure that the UK is better placed to address modern-day safety issues, harness economic opportunities and ensure a level playing field between the high street and online marketplaces. It will allow the UK to respond to modern challenges, such as the fire risk associated with such products as e-bikes and lithium-ion batteries. Without these powers, we will not be able effectively to contribute to the regulation of such potentially high-risk products. I take a moment to pay tribute to the family of Sofia Duarte, who have been tirelessly advocating for more legislation to better regulate e-bikes, along with the batteries and chargers associated with them, and generally raise awareness of their risks. Sofia sadly died as a result of an e-bike fire on New Year’s Day 2023. This legislation will allow us to take action to help prevent similar such tragedies.

I would also like to mention the work of the noble Lord, Lord Redesdale, in this space. He introduced a Lithium-ion Battery Safety Bill in September, which generated a highly interesting debate. I look forward to continued engagement with him on both Bills. I also acknowledge and thank the noble Lord, Lord Foster, for his tireless work on lithium-ion batteries over these years. There are already strict legal requirements in place whereby manufacturers must ensure that such products are safe before they are sold. This includes ensuring they provide instructions for safe use, including safe charging. However, this is a complex issue and our understanding is developing over time. We need to tailor any regulatory intervention in the most effective way. This Bill will allow us to ensure that the responsibilities of those involved in the supply of products, such as online marketplaces, are made clear.

Online marketplaces already have some legal responsibility, but the Bill will enable the Government to modernise and clarify the responsibilities of online supply chain actors, and any new duties will be in addition to responsibilities they may already have as distributors under the current framework. Without these powers, it will remain far too easy for unscrupulous suppliers to place unsafe products on the UK market through online marketplaces, which also sees them undercut good British businesses. The legislation will enable improvements to compliance and enforcement, reflecting the challenges of modern digital borders. It enables the Government and our regulators to tackle non-compliance and target interventions by allowing greater sharing of data between regulators and market surveillance authorities.

Finally, the Bill will allow us to update the legal metrology framework, which governs the accuracy of weights and measures for purchased goods, to give consumers and business greater confidence in what they are buying. This will allow for technological progress, including in support of net-zero aims—for example, ensuring that energy smart meters are accurate in their readings.

The Government have worked closely with businesses, representatives and consumer groups, which is why organisations as diverse as Which?, the London Fire Brigade, the Association of Manufacturers of Domestic Appliances, Electrical Safety First and the Chartered Trading Standards Institute are all supportive of this legislation.

The Government are bringing forward this legislation as there are insufficient powers to update the existing body of law, either to keep pace with technical developments or to deal with new risks and hazards. Existing legislation recognises EU law as it stood from our date of recognition. Recognising the product rules of key trading partners such as the EU—should we wish to do so—will help to support trade and consumer choice, but current legislation only allows us to recognise EU rules as they currently stand. The Bill ensures we have the ability to end recognition of EU laws where they do not work for our businesses and consumers.

I would like to give a brief overview of the contents of the Bill. While it is relatively short, it deals with some technical matters. It has14 clauses and a schedule. First, it creates new regulation-making powers to allow the Secretary of State to make regulations for prescribed purposes:

“Reducing or mitigating risks presented by products … ensuring that products operate efficiently or effectively … ensuring that products”


used for

“weighing or measuring operate accurately”,

or, when making provision that

“corresponds, or is similar, to … EU law”,

making regulations to reduce or mitigate

“the environmental impact of products”.

The Bill limits the scope of the products we seek to cover to tangible products that are manufactured or result from another method of production, with specific excluded products listed in the schedule.

However, while the Bill will not regulate AI on its own, we need powers in the Bill to cover it when it is integrated into, or as a component of, a physical product. With the expected increase in the inclusion of AI and machine learning in new products, it is likely that we will need to make amendments to regulations in the future to adapt to technological advances that could pose specific risks to consumers, particularly where AI is a component of a product’s safety.

It includes provision to continue recognising EU product requirements, where this is in the UK’s interest, or to end this recognition. The legislation confers an emergency derogation power to allow for the disapplication or modification of product regulatory requirements in certain emergency situations. This is subject to the affirmative procedure and builds on our experience of needing to bring products to market more quickly during the pandemic.

It creates new regulation-making powers to allow the Secretary of State to make regulations on the quantities in which certain goods may be made available in the UK market: for example, maintaining an average system of quantity control for the sale of packaged goods, including food and drink, and providing legal definitions of units of measurement and measurement standards. The Bill will also confer powers to allow tailored enforcement provision to be made in both product and metrology regulation, including the creation of criminal offences and new civil sanctions, including fines.

The Bill contains a power to amend, repeal or revoke provisions of specific primary legislation that deal with product safety and metrology, namely the Consumer Protection Act 1987, the Consumer Rights Act 2015, the Weights and Measures Act 1985 and the Gun Barrel Proof Acts of 1868 to 1978. This allows us to address the outdated governance requirements placed on the Birmingham Proof House. These were designed during the Napoleonic Wars, when there was a thriving Birmingham gun trade. This trade no longer exists. Again, this is subject to the affirmative parliamentary procedure.

The Bill contains powers to make provisions in future for a charging regime that will allow the relevant authority, such as local trading standards, to recover some of the costs attributable to the operation of enforcing the regulatory regime. Finally, it contains powers to allow the Secretary of State to make provisions in regulations permitting or requiring the sharing of information between relevant bodies, the emergency services and other persons who may be specified. This ensures that we have access to the right information in support of our market-surveillance activities and incident management.

Before finishing, I will touch on two key issues that I am sure will be of interest to noble Lords here today. The first relates to delegated powers. This Bill is what is sometimes called a framework Bill, as the vast majority of its provisions are delegated powers. The Government are fully cognisant of the importance of getting the right balance when it comes to delegated powers and using them as sparingly as possible. For technical policy areas, we believe that it is sensible and proportionate to give powers to Ministers to update and amend legislation, future-proofing the ability to respond quickly and flexibly to new technology and evolving innovation. We have minimised the use of the powers in the Bill as much as possible and we have worked closely with the Attorney-General—who, quite rightly, is a stickler for these kinds of things—to find the best approach. So we look forward to the report of the Delegated Powers and Regulatory Reform Committee, which we will carefully consider.

The second issue relates to devolution. In line with the Sewel convention, the UK Government are seeking the consent of each of the devolved legislatures for provisions that engage the legislative consent Motion process. Product safety is reserved, and, in the main, metrology is also reserved, but the Bill powers are UK-wide and subsequently touch on some elements of devolved competences. We are actively engaged with the devolved Governments on these provisions and will continue to work with them on any concerns they may have. We want to see that the broad support for the policy in this Bill is translated into legislative consent from the devolved Governments. I will update noble Lords as the Bill continues its passage.

I end by saying that this Bill will protect consumers and support businesses by ensuring that the UK is better placed to address modern-day safety issues. It will let us harness opportunities that deliver economic growth and will create a level playing field between the high street and online marketplaces by putting in place appropriate responsibilities throughout the supply chain. The result is that consumers can buy with confidence and businesses can trade effectively and compete fairly. Ultimately, it allows the UK to decide how best to protect consumers and support businesses on our own terms. To echo an often-used phrase, this legislation allows us to “take back control”. But, crucially, it allows us to do so in a way that supports our twin-track approach to trade: seeking a closer, more mature trading partnership with the EU and forging new trading relationships with countries around the world, too. I beg to move.

--- Later in debate ---

[Lord Leong (Lab)]

My Lords, I would first like to thank all noble Lords for their very kind remarks; they are much appreciated. I also thank noble Lords for taking part in today’s debate, and for the contributions from all sides of the House. Today’s debate has been not only informative and wide-ranging but also illustrated the depth of expertise and experience present in your Lordships’ House.

I was particularly pleased to hear the maiden speech of my noble friend Lady Winterton. She brings much experience and wisdom, having served with distinction as Deputy Speaker in the other place and as a Minister in multiple government departments between 2001 and 2010. Freed as she now is from the necessary neutrality of a formal role, we welcome her warmly to the government Benches, where I suspect that, like her former boss, Lord Prescott, she will pull no punches. I look forward to hearing from her many more times in the future.

As we have heard, product safety failures can have devastating consequences. We are determined that our regulatory framework is agile and flexible in its response both to new threats and to complex supply chains. For innovation to flourish and potential for growth to be realised, it is essential that consumers can have confidence in the safety of the products they buy and in the businesses that they buy from.

I will try my very best to address as many of the issues and questions raised today as possible within my timeframe of 20 minutes. If I do not have the time, I will get my office to go through Hansard and provide written answers to noble Lords and have a copy placed in the Library. Finally, let me assure all noble Lords that I want to work constructively and proactively in the passage of this Bill, and I will have many more conversations and share information with noble Lords through Peers drop-in sessions—my office is always open, so feel free to contact me and my private office.

The noble Lords, Lord Frost, Lord Browne and Lord Jackson, and the noble Baroness, Lady Lawlor, raised concerns that this Bill is tantamount to the UK rejoining the EU through the backdoor. Let me be extremely clear: this Bill is not rejoining the EU by the backdoor. This Bill gives us the flexibility to ensure that product regulation, now and in the future, is tailored to the needs of the UK. There will be some instances where we will want to take a similar approach to the EU, and there will be others where it makes sense for the UK to diverge. Those decisions will be based on the best interests of the UK’s businesses and consumers, and any secondary legislation will be subject to the usual parliamentary scrutiny. As I said in my opening speech, we are taking back control, seeking closer, more mature trading partnerships with the EU and forging new trading relationships with the global world out there.

The noble Lords, Lord Foster, Lord Browne of Ladyton, Lord Bourne, Lord Fox and Lord Johnson, and the noble Baroness, Lady Bennett, raised questions about devolution. The vast majority of product safety and metrology legislation is reserved, with some specific exceptions. We expect the overwhelming majority of secondary legislation brought forward under the main powers in Clauses 1 and 5 to be reserved. Given the technical nature of product regulation and metrology, it is possible—as many noble Lords have mentioned—that some elements of secondary legislation may touch on devolved aspects, such as regulating the environmental impact of certain products, as we consider safety impacts alongside.

Following meetings with my counterparts, I welcome their broad support for the policy intentions behind the Bill. However, we recognise that the devolved Governments have raised some concerns about the drafting and breadth of delegated power in the Bill. As outlined in our manifesto, this Government are committed to reset the UK Government’s relationship with the devolved Governments in Scotland, Wales and Northern Ireland. I have had positive meetings with my counterparts in the Welsh Government and Northern Ireland Executive and will be meeting with the Scottish Government this week. My department is engaging with all devolved Governments in an open and collaborative spirit, and we hope that we will gain legislative consent Motions from the devolved legislatures. I will keep the House informed of those discussions.

On the specific case of Northern Ireland, which has been raised by several noble Lords, in order to ensure dual access to both the UK internal market and the EU single market, Northern Ireland applies certain EU product regulations and metrology rules under the Windsor Framework. The Bill provides the Minister with the ability to make a sovereign choice and effectively manage upcoming regulatory divergence between the UK and EU, and therefore to ensure continuity across the UK internal market, where it is in our domestic interest to do so. As such, we expect that the Bill will have a positive impact on trade between Northern Ireland and the rest of the UK.

The noble Lords, Lord Foster, Lord Fox and Lord Johnson, raised the importance of ensuring that the enforcement authorities have adequate resources to fulfil their function. With this Bill we intend to improve enforcement capability, leading to more efficient and effective use of time through a better suite of notices and better data-sharing opportunities. The Office for Product Safety and Standards will continue to provide a range of support to enforcement authorities. This will include support on technical queries, access to product testing and an ongoing programme of training and continuous professional development. The Office for Product Safety and Standards will also produce guidelines for the application of any new powers so that enforcement authorities are equipped to use them efficiently.

The noble Lord, Lord Lansley, and several other noble Lords raised an important issue relating to international standards. The Bill will enable us to continue to amend product regulations as well as allow the designation of international standards for products in scope. In line with WTO obligations, the UK recognises the benefits and supports the use of international standards, as well as regional standards, to break down trade barriers with our trading partners. The British Standards Institution regularly reviews UK standards, replacing domestic standards with appropriate international ones. This is also something that the UK pursues in its international agreements.

The noble Lords, Lord Sandhurst, Lord Foster, Lord Lucas, Lord Jackson and Lord Fox, and the noble Viscount, Lord Trenchard, asked whether any draft regulations under the Bill would be produced. The Government are working through policy positions on a range of issues following the election, including addressing the sale of unsafe products via online marketplaces. Additionally, we are reviewing changes the EU is proposing to its registration regulations and considering the applications. Throughout, our response will depend on the outcome of our call for evidence and policy discussions with stakeholders.

The noble Lord, Lord Sandhurst, asked about the poor way we are approaching legislation. The review he referred to was issued by the previous Government. It was clear then that to make fundamental changes to product regulation requires primary legislation because the powers were not available to us, hence bidding for this Bill to ensure that we secure the powers to act in good time to address emerging risks.

The noble Lords, Lord Foster and Lord Sandhurst, asked about online marketplaces. It was right for us to bring forward this Bill to give us the powers we need to address sales of unsafe products by online marketplaces —an area on which the product safety review consulted. Consumer groups such as Which? have also been calling for us to take action. This Bill will allow us to take action now.

The noble Lords, Lord Sandhurst, Lord Foster and Lord Johnson, asked why we have not published a response to the product review consultation. We have bid for the necessary powers to make changes to our regulations and have introduced this Bill, which will deliver enabling powers to allow us to implement a lot of the policy proposals emanating from the product safety review to which the noble Lord, Lord Sandhurst, referred. That review received 126 responses covering regulatory changes. Action on online marketplace enforcement was supported by all respondents. The powers in the Bill are available powers and we have continued conversations with a wide range of stakeholders on the detail.

[Lord Sandhurst (Con)]

I appreciate that, but we have not actually got any detail at all, or even a summary, of what the responses are. We really do require that; it is normal.

[Lord Leong (Lab)]

I thank the noble Lord, Lord Sandhurst. I will ask my officials and come back to the noble Lord on that request.

The noble Lord, Lord Foster, asked about lithium-ion batteries. I am pleased to advise that, while we have been in this debate, Minister Madders, my colleague in the other place, is in Paris at the OECD global awareness campaign, which this year focuses on lithium-ion batteries. The UK and the Office for Product Safety and Standards have been leading on this campaign. The noble Lords, Lord Redesdale and Lord Fox, raised additional points about disposal. Ministers are referring proposals to consult on reforms to UK battery regulations before setting out next steps.

The noble Lord, Lord Russell of Liverpool, asked why the UK wished to be able to continue recognising the CE marking. This Bill will allow the Government to choose to recognise updates to EU product regulation to provide continued regulatory stability and avoid extra costs for business where this is in our interests. It will also allow us to end recognition of EU requirements where it is in the interest of business and consumers. We presently recognise current EU regulations for a range of products. Legislation passed in May 2024 to continue CE recognition for 21 product regulations is estimated to save UK businesses £640 million over a 10-year period, largely from avoiding duplicate compliance and labelling costs. Provisions in the Bill allowing us to continue or end recognition of EU requirements will enable us to provide the certainty that businesses need to plan for the future and innovate, supporting economic growth. The UK and EU share information on trade, including changes to the trade and co-operation agreement.

The noble Lord, Lord Foster, and several other noble Lords asked about the disposal of lithium-ion batteries. The Government are committed to cracking down on waste as we move towards a circular economy, where we keep the resources we use for longer and reduce waste. The existing product responsibility scheme for batteries and waste electronics makes producers responsible for the cost of end-of-life treatment. Under existing UK legislation it is already mandatory for all batteries placed on the market in the UK to be clearly marked with the crossed-out wheelie bin.

The noble Baroness, Lady Crawley, asked why there have been no changes to legislation on product safety since our exit from the EU. I can reaffirm that this is real, hence bringing forward powers in this Bill to allow us to make changes before divergence happens and we fall further behind.

The noble Lord, Lord Frost, asked why we cannot use existing powers. The new Bill powers are required to enable the Government to modernise and future-proof product regulation, ensuring that it is tailored to the needs of the UK. The powers in the retained EU law Act 2023 are limited, in that they can be used only to revoke and replace assimilated law and have other inbuilt restrictions—for example, secondary legislation that is made under REUL must be deregulatory. This means that we would not be able to use the powers to increase safety requirements to respond to new and emerging threats through further amendments and legislation which was not assimilated law before.

The noble Lord, Lord Frost, also asked whether the Bill will make the UK a rule-taker or a rule-maker. We are definitely not a rule-taker. We are a rule-maker, and the Bill will provide powers to give the UK greater flexibility in setting and updating its own product-related rules, as well as enabling the UK to choose whether to recognise relevant EU products requirements. Any further changes made using these powers will be subject to appropriate parliamentary scrutiny. The noble Lord asked whether the Bill protects internal markets. The Bill will give us flexibility to ensure product regulation and metrology now and in the future. It is tailored to the needs of the UK as a whole. It will enable us to make changes to product regulation and metrology legislation that will benefit businesses and consumers.

The noble Lord, Lord Frost, also asked about the Windsor Framework. In updating its regulation, the EU will be seeking to deal with many of the same challenges that the Bill will address: for example, online marketplaces and batteries. The Bill will enable a choice to be made as to whether it is in the interests of UK businesses and consumers for UK regulations to take the same or a similar approach, or indeed a different one.

The noble Baroness, Lady Brinton, asked whether the Government will commit to a policy of alignment with EU chemical protections. This Government are committed to protecting human health and the environment from the risks posed by chemicals. We are currently considering the best approach to chemicals regulation in the UK separately to this Bill and will set out our priorities and next steps in due course. The noble Baroness also asked how the Bill will help the Government respond to emergencies.

[Lord Fox (LD)]

Am I to understand that, if there is to be separate consideration for chemicals regulation, it will not be in this Session because it was not in the King’s Speech? So all those businesses that are currently struggling with where we are now have at least a year, and probably 18 months, to wait before any sense of a Bill—never mind that Bill becoming law.

[Lord Leong (Lab)]

I am coming back to that in the later part of my winding speech.

National emergencies such as Covid-19 highlight the importance of ensuring that our product regulation framework allows for flexibility in times of national emergency. This enabling Bill will allow the Government, in response to an emergency, to temporarily disapply and modify product regulation while maintaining high safety standards, thereby providing a faster process by which critical products are able to reach the market in order to sustain an adequate supply of such products.

[Baroness Brinton (LD)]

I apologise, but that was not my question. My question was: will the Government make sure that, if emergency powers are used, both Houses of Parliament are kept informed prior to that happening?

[Lord Leong (Lab)]

I will get back to the noble Baroness in writing. I see the time flashing, so I might have to write to other noble Lords in response to their questions. Let me conclude.

I would like to thank everyone across this House for their contributions in today’s debate. I specifically thank my counterparts on the Opposition Benches, the noble Lords, Lord Johnson of Lainston and Lord Fox. This is not the first time that we have sat across from each other in such debates, albeit in different spots. I look back fondly on our debates during the passage of the CPTPP Act last year. I hope and expect that debates on this Bill will be as good-natured and as enlightening as those were.

I should like to stress my willingness to meet noble Lords to discuss further the detail of the Bill. I take the firm view that dialogue is essential to building public and parliamentary support.

To sum up, this Bill allows us to keep pace with new technologies, gives us the tools to stop dodgy suppliers placing dangerous goods on the market and allows us to make sovereign choices as to how we diverge or align with the EU and other trading partners. It gives enforcement bodies the tools they need to tackle modern problems facing the transit of goods coming across our borders, be they land, maritime or digital. Finally, it will allow us to update the legal and technological framework that underpins economy and trade. This Government will never compromise on safety. The Bill is essential to strengthening the rules and regulations needed to protect consumers, businesses and the public.

Bill read a second time and committed to a Grand Committee.

Product Regulation and Metrology Bill [HL]

Lord Leong Excerpts

Committee stage
Wednesday 20th November 2024 Grand Committee

[Lord Lucas (Con)]

My Lords, we have been here before. When the Schools Bill was in front of us, I was very happily lined up next to Lord Judge in saying that this would not do, and I find myself in the same position today. We have a job to do in the House of Lords; it is the proper scrutiny of legislation. This Bill seeks to avoid that. Either the Bill needs to wait and rewrite itself in rather more detail when the Government know what they want to do, or we need some such provision as has been suggested by the noble Lord, Lord Anderson and others to allow us a proper view of what will actually happen under this legislation. I very much hope that the Government will rethink, in one direction or the other.

[Lord Leong (Lab)]

My Lords, I join noble Lords in congratulating the noble Lord, Lord Sharpe, on his appointment. I look forward to working with him in the years ahead.

I thank all noble Lords for speaking on this group. Noble Lords across the Committee have raised a number of important issues relating to scrutiny. I reassure them, up front, that this Government take very seriously the importance of scrutiny, in particular facilitating parliamentary consideration of government proposals. However, we believe overall that the Bill strikes the right balance on the need for proper consideration of the important issues and the technical nature of many product regulations.

I start with Amendment 132. The noble Lord, Lord Fox, has proposed the publishing of impact assessments of affirmative regulations laid every six months after the Bill’s implementation. The impact of any new regulations will be fully considered through the development of proportionate impact analysis. The Better Regulation Framework, as most noble Lords know, is the system that the Government use to manage the flow of regulation and understand its impacts. In line with the Better Regulation Framework, for regulations where significant impacts are anticipated —above £10 million per year—full impact assessments will be published. For regulations with lower anticipated impacts, a proportionate de minimis assessment impact analysis will be completed. These assessments will, as a matter of course, consider the impact of regulations on small and medium-sized enterprises. Therefore, the laudable sentiment behind these amendments is already covered.

A number of the amendments relate to the use of the affirmative procedure. There exists a process for scrutinising secondary legislation that will operate under this Bill, including by scrutinising committees. I recognise the Bill’s delegated powers have raised questions, including from the Delegated Powers and Regulatory Reform Committee, which the Parliamentary Under-Secretary of State for Employment Rights, Minister Madders, and I appeared before in October. I remind noble Lords that the DPRRC stated and admitted in that evidence session that it saw the need for powers. The Government take seriously the recommendations of the DPRRC, and I plead mea culpa—we put our hands up that we should have been much clearer and could have done more to explain the reasons for the approach taken in this Bill.

The noble Lord, Lord Sharpe, asked about the Attorney-General’s speech at the Bingham lecture. He is a fine lawyer and is a good friend of mine. I listen to him all the time. But he said in his speech that this Bill does not exceed excessive powers. Product regulation is very technical, and we have ensured the that the Bill allows for appropriate parliamentary scrutiny, enabling this House to play the crucial role of scrutinising legislation. Existing secondary legislation runs to over 2,500 pages and covers everything from consumer products, such as toys and cosmetics to heavy industrial products like pressure equipment. We intend to use the Bill’s delegated powers to make targeted changes, on a case-by-case basis, to update and build on the large and well-established existing framework.

I should like to reassure all noble Lords on the specific point around EU law. The appropriate scrutiny procedure is provided by Clause 11, which applies the draft affirmative procedure to various regulations, including those making provision for a power of entry, creating a criminal offence or amending primary legislation, which will need to be debated and approved by Parliament before being implemented.

I turn to Amendment 133, in the name of the noble Lord, Lord Fox. This proposes a sifting mechanism whereby all regulations are preconsidered by a joint committee of both Houses. While we understand the need for oversight, a bespoke joint committee approach could cause delays. In addition, there is already a parliamentary process for statutory instruments made under specific Acts of constitutional significance where sifting is applied to ensure appropriate scrutiny. We do not consider that such a process is proportionate or necessary under this Bill, where regulations will often relate to routine minor technical changes—for example, a change in chemical content in cosmetics or toys.

I turn to the amendments of the noble Baroness, Lady Lawlor—

[Lord Fox (LD)]

I think the Minister is trying to have it both ways. On the one hand, this committee is so long-winded that important and breathless regulation could not be made and, on the other hand, the regulations will be so small and insignificant that this committee does not need to observe them. It is either one thing or the other—and if there are emergency regulations, I am sure that we can put in place a process to necessarily short circuit and get that before your Lordships’ House quickly. So, the idea that somehow this would hold up vital regulation that that the country is waiting for overnight is something of an overstatement of the process of regulatory development.

[Lord Leong (Lab)]

I said earlier that we will look at this on a case-by-case basis. Some regulations will relate to very minor technical changes, so it really would be taking up too much parliamentary time for that, whereas other regulations may need a full scrutiny, and we will have avenues for that.

On the amendments from the noble Baroness, Lady Lawlor, although parliamentary oversight is crucial, requiring the sunsetting and renewal of regulations under Clause 1 would create legislative gaps and undermine regulatory certainty. This is particularly for essential product regulations that protect consumers or for products where their design, production and installation may take over a year. Ensuring consumer safety is a constant, ongoing concern. We also have to ensure that businesses have certainty. Having a sunset clause will not give certainty to businesses.

As I have explained, these are also highly technical regulations, covering matters as detailed as the formulae for measuring outdoor noise, for example, and I am not sure it would be a good use of parliamentary time to re-examine such specific matters on an annual basis.

Similarly, Amendments 40, 41, and 131 from the noble Baroness, Lady Lawlor, ensure that regulations incorporating EU law will be subject to parliamentary debate, with consideration of constitutional impacts. As Members of the House will be aware, a duty to assess the impacts of any new legislation on trade between Northern Ireland and Great Britain already exists, and the responsible Minister must make a statement considering any impacts on trade between Northern Ireland and the UK internal market. To provide additional assurances, it is considered that the powers set out in Clause 5(2) provide a proportionate and appropriate parliamentary scrutiny process, where the regulations will often be highly technical and routine in nature.

Noble Lords, including those on the DPRRC, have questioned the Government’s intentions as regards consultation on changes made under the Bill’s powers. Amendment 126, tabled by my noble friend Lady Crawley, for example, proposes to establish a duty for the Secretary of State to publish regulations in draft form, and consult such persons as the Secretary of State considers appropriate.

I fully appreciate the importance of consultation and industry engagement. My department and the Department for Business and Trade have excellent relationships with industry and consumer groups and will continue to engage regularly with any stakeholders before changes are introduced. Indeed, we currently have two calls for evidence in circulation seeking stakeholder input, one on the introduction across the UK of a common charger for all our mobile phones and other portable electrical and electronic devices, and the other on measuring noise from outdoor equipment.

We have not included a statutory consultation requirement to allow for proportionate engagement with industry and consumer groups depending on the significance of the changes. This ensures agility in responding to emerging risks or market developments to protect UK consumers, as mentioned by the noble Earl, Lord Lytton. But I give a firm commitment to noble Lords that the Secretary of State will engage and consult with relevant stakeholders before legislating.

Amendment 33, in the name of the noble Lord, Lord Jackson, and mentioned by the noble Lord, Lord Fox, refers to supply chains involved in products and the extent we need to regulate them. This can be complex, and it is important that we get it right.

Clause 2(3) sets out examples of the persons on whom product regulations may be imposed. However, this is not always clear. Depending on the nature of the product or its supply chain, product regulations may need to cover a whole variety of other actors involved in a product journey. For example, our regulations on the safety of lifts need to cover the people involved in their installation as well as their manufacture, and regulations on recreational craft cover private importers in addition to the usual supply chain actors.

We also need to ensure that rapidly changing business models cannot be exploited, allowing bad actors to exploit good business by defining themselves out of regulation. For this reason, Clause 2(3) is an inclusive list, not an exhaustive list, of persons on whom regulations can be imposed. Clause 2(3)(h) further clarifies that regulations can apply to anyone carrying out activities in relation to a product.

[Lord Fox (LD)]

My Lords, I beg your Lordships’ leave, and I apologise to the noble Lord, Lord Jackson, for taking over his amendment here, but the wording of Clause 2(3)(h) is

“any other person carrying out activities”.

All the other items refer to the activity of the sale and marketing of that product. This does not refer to it but any person carrying out activities unspecified. For example, if I were repairing a product, would I be in the scope of the Bill? I could be, but I do not think that that is the purpose of the Bill. There needs to be some modification of that language—I think the noble Lord, Lord Jackson, is shrewd in putting that up—which focuses on the development and marketing of the product. Otherwise, it is any person doing anything to it.

[Lord Leong (Lab)]

I thank the noble Lord for that point. As I see it, it is the whole manufacturing of the product itself. For example, 3D printers are getting cheaper and cheaper on the market, and anyone can make anything from a 3D printer. So we need a regulation that covers someone who sells the printer, someone who supplies the plastic that goes into the printer and whoever makes that. Unless the noble Lord is mistaken, perhaps I and officials could have a private conversation with him and the noble Lord, Lord Jackson.

[Lord Fox (LD)]

I think we better had.

[Lord Leong (Lab)]

To conclude, I hope that I have been able to provide assurances on all these matters and I assure noble Lords that the Government have carefully considered—

[Lord Deben (Con)]

Before the noble Lord sits down, I am very much in favour of most of the Bill, but this bit is very difficult. I have been around a long time, and I have known Minister after Minister explain that things are too technical for us to have proper parliamentary scrutiny, and I heard it again today. The fact is that there is some real concern, even from those of us who are, in general terms, in favour—I hope it gets as near to parity with the rest of Europe, which is our biggest market—as we want to be sure that Parliament has a say, but I am not sure that the Minister has given us a very good answer. Saying that it is very technical is the oldest story that civil servants have given Ministers since we have had civil servants and Ministers.

[Lord Leong (Lab)]

I thank the noble Lord for that. If it helps, I have gone through some of our 150-odd existing product safety regulations—not all of them—and their technical nature includes scientific calculation and all kinds of other technical input. Are we saying that we want this in every instance of primary legislation? I think not. If noble Lords think that we should have every technical aspect in all primary legislation, we need to have a different debate entirely, but for this, for technical reasons, we need delegated legislation to ensure that we update the regulations.

[Lord Jackson of Peterborough (Con)]

I do not want to labour the point, but it is either feast or famine. We are being told by the Government that we cannot legislate everything to the nth degree, so we should just trust them on the secondary legislation—the permissive delegated legislation and statutory instruments. But then, with the paragraph that is the subject of my amendment, we are going to the nth degree of granularity and technical finesse while not actually, as it happens, defining what “activities” mean. Activities could mean looking at a product, by which you would therefore be caught by the regulations.

I gently say to the Minister that the substantive clause is not undermined by the removal of this paragraph, and he should seriously think about that.

[Lord Leong (Lab)]

I thank the noble Lord for that. I shall take it away and speak to officials about this, but the purpose of the Bill is not to be too prescriptive, so that we cover most of the activities that can be described by various stages of production.

I want to conclude, if I may. I hope that I have been able to provide reassurance on all these matters and have assured noble Lords that the Government have carefully considered the importance of parliamentary scrutiny and sought to strike a careful balance. I therefore respectfully ask that the amendment is withdrawn.

[Lord Sharpe of Epsom (Con)]

My Lords, I do not really have very much to say. I am partially reassured by what the Minister has tried to say, but we will have to study the contents of this debate, which has been fascinating and wide-ranging. It was remiss of me not to have thanked the Minister earlier for his engagement and that of his team, and I apologise. We reserve the right to come back to this, but I beg leave to withdraw the amendment.

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[Lord Sandhurst (Con)]

My Lords, I begin by saying that, like others, I am grateful to the Minister for the time he gave to meeting me. However, the fact remains that our concerns about the Bill have not been assuaged. There are fundamental flaws, as others have said. We do not disagree with the aims of the Bill in general terms; the problem is that we just do not know what the specific policies are. We do not know what route will be taken to address the issues that may arise. It is simply too vague. There will be no opportunity for consultation on, or challenge to, the policies or regulations: policies will be produced by the Minister and that will be that. We know that policies should be in the Bill.

I thank the noble Lord, Lord Foster, for his thoughtful amendments and his commitment to addressing the significant issues raised by Clauses 1 and 2. These electronic developments, such as lithium-ion batteries and so on, are serious issues; they certainly need to be addressed. However, these amendments relate to Clauses 1 and 2, which have been identified by the Delegated Powers and Regulatory Reform Committee and the Constitution Committee as fit only for complete removal from the Bill, for the reasons set out in their reports. Those committees have strongly criticised these clauses because they lack substance and give excessive discretion to Ministers; as I said at Second Reading, this is a Henry VIII Bill par excellence.

We must therefore now be told—we are still waiting—in much more detail what direction the Government think we should take on the matters of substance and importance that the Bill addresses. Ministers are to be empowered to legislate by statutory instrument on matters that are really important for businesses on the receiving end and for consumers, also on the receiving end—or not, if nothing is done—such as marketing, product regulation and metrology. Here in Parliament, we have been given no clear framework or policy direction.

The Delegated Powers and Regulatory Reform Committee’s detailed report of 15 October, which of course came after Second Reading and after substantive objections had been raised by me and others, stated that the skeleton clauses, which include but are not limited to Clauses 1 and 2,

“contain almost no substance about the marketing and use of products but instead give Ministers very broad powers which confer considerable discretion to legislate in that area by statutory instrument”.

On 16 October, the same committee held an evidence session at which it discussed these concerns with the noble Lord, Lord Leong; Justin Madders MP, the Minister in the other place; Helen Le Mottee, deputy director legal for products, business and better regulation; and Tony Thomas, deputy director for product safety policy. The committee said:

“In the evidence session, the Ministers and their officials provided helpful additional information about … the existing legislation that could be amended by regulations made under the powers that the Bill confers; and … the need for the Bill to confer regulation-making powers that would allow detailed and technical provision to be tailored for different types of products and would give Ministers the flexibility to respond quickly and effectively to rapid technological changes and product safety concerns … That additional information could helpfully have been included in the Delegated Powers Memorandum provided by the Department for Business and Trade”.


The committee recognised the need for the Bill to delegate some legislative powers—I think we all understand that that is necessary. However, the committee stood by and repeated the essence of its 15 October first report, notwithstanding the improvement of approach. It said that

“skeleton legislation should only be used in the most exceptional circumstances”—

and we are not there; this is not Covid. We are not in another emergency situation—

“and where no other approach would be reasonable to adopt”.

That, it explained—and I make no apology for repeating this—

“signifies an exceptional shift in power from Parliament to the executive and entails the Government, in effect, asking Parliament to pass primary legislation which is so insubstantial that it leaves the real operation of the legislation to be decided by Ministers”.

Frankly, I say, if they do it with this Bill, they will do it with all future legislation. There was enough fuss in the last Parliament about what those on this side were doing, and now we are going straight down that route and extending it into the distance. As the committee said, the Government

“needs to explain why the Bill provides for almost all of the substance of product regulation and metrology to be provided for by Ministers in regulations under the new powers, and little or nothing to be settled under the fuller Parliamentary scrutiny given to Bill provisions”.

Without clear boundaries or principles, these powers could allow Ministers to fundamentally alter product regulation, metrology standards and even consumer protections with little notice or prior consultation. They can just do what they like if a Minister fancies it or a civil servant has a bee in his bonnet—I mean nothing personal about the civil servants sitting there. I think your Lordships all understand what I have in mind. People have idées fixes, their opportunity comes along, off they go and Parliament will be able to do absolutely nothing about it. This risks creating legal uncertainty, regulatory overreach and a chilling effect on business, stakeholders and consumers.

Clauses 1 and 2 as they stand must, we say, be either significantly revised or removed entirely, as recommended by both committees of which we have already heard rather a lot. Failing such improvements, we on this side of the House will move for the offending clauses to be removed on Report. The Government should understand that.

[Lord Leong (Lab)]

My Lords, before I address Amendments 2 and 27 tabled by the noble Lord, Lord Foster, I need to make a clarification. The Attorney-General made a general comment about excessive reliance on delegated legislation; he did not comment on this Bill. We certainly do not believe this Bill contains excessive reliance on delegated legislation.

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[Lord Leong (Lab)]

I thank noble Lords and the noble Baroness for their amendments in this group. Products in the scope of the Bill are used by every person in this country, covering nearly all manufactured products. We estimate that at least 300,000 UK businesses, employing several million employees, with an estimated market turnover of £490 billion, must adhere to product safety legislation.

The product safety review call for evidence in 2020 and 2021 received something like 158 responses; 126 responses were received in response to the product safety review consultation in 2023; 53 engagement events were held, reaching about 400 stakeholders; and, throughout last year, my department undertook 46 round tables with more than 300 stakeholders, both domestically and internationally. I want to set the picture so that all noble Lords know that we undertook reviews before the Bill was brought to Parliament.

Many businesses and consumer organisations support the Bill, seeing it as a common-sense approach to ensuring that the existing body of product regulation is fit for purpose in the face of technological and other changes. I emphasise again that the Government have been very clear that the UK will not rejoin the EU single market, customs union or freedom of movement. It is important to reset our relations with our nearest friends and neighbours, but that does not mean a return to the arrangements of the past.

Let us not forget that the bulk of UK product regulation is derived from EU law. This is precisely the reason the legislation explicitly references that jurisdiction and not others. If the UK makes a sovereign decision to mirror EU provisions, the Bill provides the mechanism and flexibility, on a case-by-case basis, to do so. This would avoid primary legislation each time technical changes are needed and would increase the certainty that businesses are crying out for. I hope noble Lords will support this pragmatic approach.

However, it is not our default position that we will mirror EU requirements. The Government will be guided by the needs of businesses and consumers, which may differ. Nothing in the Bill prevents the UK diverging from EU requirements. The Government’s approach, whether to mirror or diverge, will be driven by evidence, subject to industry engagement, as discussed earlier in group 1, and support our mission to drive economic growth and provide consistency and certainty to businesses.

I turn to the amendment by the noble Lord, Lord Russell. The Bill provides powers that will give the UK greater flexibility in setting and updating its own product-related rules. It also enables the UK to choose to recognise relevant EU product requirements where it is in the interest of our businesses and consumers to do so. The Government have strong relationships with stakeholders, including industry, trade associations and consumer groups, and will continue to engage with them before any regulatory changes are brought to this House.

Amendment 4 proposes removing the powers in the Bill that would allow us to update regulations that address the environmental impact of products where similar provision exists in EU law. Amendment 6 proposes broadening these powers to update UK regulations to mirror any international jurisdiction. The noble Lord, Lord Jackson, talked about environmental impact, and I thank the noble Baroness, Lady Bennett, for her contribution which leaves me with very little to say here, except that many products are required to meet multiple product regulations, including those which may address the environmental impact of products.

As I have noted, most UK product legislation is derived from EU law. The powers in Clause 1(2) are intended to be used in limited circumstances where there is a corresponding or similar provision in EU product regulations for the purpose of reducing or mitigating the environmental impact of products. This ensures that the power could be exercised to create regulatory certainty and manage changes to EU rules we recognise.

This power is limited in this way as we do not wish to create powers to regulate on wider environmental objectives. This already exists, for example, under the Environment Act. Clause 1(2) in no way obliges the UK to recognise or to mirror EU provisions. We have been clear that such decisions will be taken on a case-by-case basis and subject to parliamentary scrutiny.

Product Regulation and Metrology Bill [HL]

Lord Leong Excerpts

Committee stage
Monday 25th November 2024 Grand Committee

[Lord Lansley (Con)]

My Lords, I apologise that I was not able to be with the Committee on its first day, nor will I for much of this afternoon, but I look forward to returning for my amendments on Wednesday. I support my noble friend Lord Sharpe’s amendment.

When we debated the regulation of medical devices in the Medicines and Medical Devices Act 2021, we established that safety and safeguarding public health was its overriding objective. However, we went on to say in what is now Section 15(3) of that Act that in considering whether regulations should be made, and whether they would contribute to the objective of safeguarding public health,

“the Secretary of State must have regard to”—

I commend that language to my noble friend, rather than “must support”, which I think takes it a bit far and creates conflicting duties—

“the safety of medical devices … the availability of medical devices … the likelihood of the United Kingdom being seen as a favourable place in which to … carry out research relating to medical devices … develop medical devices, or … manufacture or supply medical devices”.

I draw attention to the third of those. The structure of the existing legislation on the product requirements for medical devices already incorporates an expectation that we consider economic activity, economic growth and our comparative position in the manufacture or supply of such products. I say to my noble friend that that is an alternative formulation which thoroughly supports, through the precedent of a very closely related area of regulation, the idea that economic activity of that form should be part of the consideration of whether and how regulations should be made.

[Lord Leong (Lab)]

My Lords, I thank the noble Lord, Lord Sharpe, and the noble Baroness, Lady Lawlor, for their contributions on Amendments 11 and 11A, which specify that regulations made under the Bill should promote investment, foster innovation and encourage economic growth and investment. This Government are committed to attracting investment, as illustrated by the £63 billion pledged at the recent international investment summit. Britain is open for business.

I assure noble Lords that growth is the number one mission of this Government and our new industrial strategy, to be published in the spring, is central to it. The strategy will focus on tackling sector-specific and cross-cutting barriers to growth for our highest-potential growth-driving sectors and places, creating the right conditions for increased investment and high-quality jobs and ensuring a tangible impact in communities right across this country.

I also thank the noble Lord, Lord Sharpe, for his Amendments 104A and 124A, which seek to create regulatory sandboxes where new products could be trialled under regulatory supervision, as indicated by the noble Lord, Lord Kirkhope. I recognise and welcome the intention behind the amendments, which seek to encourage innovation. The Office for Product Safety and Standards within my department already works to provide businesses with guidance and support as they develop and market products. We also support local authorities in their work as primary authorities. This allows businesses to receive assured and tailored advice on meeting environmental health, trading standards or fire safety regulations from a single local authority, then applying this advice nationally. The underpinnings of our product safety regime are based on extensive engagement with businesses. Whether it is on regulatory change, the development of standards or the work of the OPSS as a regulator, the relevant bodies consult extensively across industry.

I am always open to new ideas on how to support businesses to innovate. I understand that in 2022 the Office for Product Safety and Standards supported the Home Office in a regulatory sandbox trialling electronic ID for alcohol sales. However, I am concerned about mandating regulatory sandboxes in the Bill. Product safety is, after all, about avoiding potentially serious risks to people and their property, and anything that would relax regulations in this way, even as a trial, would need careful consideration. It could also commit local responsible authorities to run trials in their areas without sufficient consultation or preparation. This could place an undue burden on local authorities, diverting resources and capacity from their primary responsibilities.

This Government are committed to ensuring that any regulations made under this Bill will support the interests of UK businesses and consumers, providing regulatory certainty and creating the conditions for investment, innovation and economic growth. The Government are always open to debate to ensure that we can support businesses to deliver safe and effective products. I hope I have demonstrated to the noble Lord the extent to which regulators already work closely with businesses to achieve this.

In response to the point from the noble Lord, Lord Sharpe, about SMEs, I was an SME once; we do not want to burden SMEs with additional regulatory or financial cost, if possible. This Government are pro-business and pro-worker and have provided certainty, consistency and confidence—for which investors have been looking for a very long time. Massive tax reliefs are available to investors through the EIS, the SEIS, VCTs and all kinds of grants, including patent grants for any new industries. The Government have shown that we are committed to investment and growth.

I hope that I have been able to reassure noble Lords that the Government are committed to fostering growth through all our policies. This will be set out in more detail in the forthcoming industrial strategy, which we will publish in the spring. I therefore ask the noble Lord to withdraw his amendment.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank all speakers, in particular my noble friend Lady Lawlor for so eloquently introducing her amendment. I say to my noble friend Lord Kirkhope that my remarks are in no way meant to diminish any of our trading relationships; the point is that these amendments are designed to look after our national interest. It may well be that aligning with the EU is in our national interest, in which case we absolutely should, but if it is not, then we should not, and any reference to relative economic growth is merely factual. I thank my noble friend very much indeed for his supportive remarks on Amendments 104A and 124A.

I also thank my noble friend Lord Lansley for his perspective, which will be very helpful when we come to later stages of the Bill. I also thank the Minister for his remarks, which provided helpful clarity. I take comfort from the fact that he remains open to new ideas. We will consider his remarks carefully but are very pleased to hear his reassurances regarding SMEs. For now, I beg leave to withdraw my amendment.

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[Lord Sharpe of Epsom (Con)]

My Lords, I thank the noble Baroness, Lady Crawley, for her remarks. Obviously, defining “products” is a key consideration in much of what we have to discuss in this Bill. It is a subject to which we will return later today. I thank the noble Lords for introducing their amendments. It was very eloquently done. They certainly deserve consideration and comprehensive answers from the Government.

I will speak to Amendments 18 and 19 standing in my name. The Bill as it stands—and I am afraid this is going to be rather labouring a point that we discussed a lot last week—has been widely criticised for being skeleton legislation with much of the substance being delegated to Ministers through statutory instruments. The Delegated Powers and Regulatory Reform Committee has rightly pointed out that this leaves “almost no substance” or perhaps, as the noble Baroness, Lady Crawley, described it, no clear markers in the Bill, giving Ministers excessive and unaccountable discretion to regulate in important areas, such as product marketing and safety, without sufficient parliamentary scrutiny or oversight.

Clause 2 is a prime example of this, because it grants wide powers to Ministers to make regulations on a wide range of product characteristics—but without any clear or substantive detail. By keeping paragraph (a), the Bill opens the door to the possibility of Ministers creating regulations that lack transparency or specificity. I find the wording concerning and unnecessarily vague. For example, the phrase “other characteristics of products”—or, as the noble Lord, Lord Foster of Bath, described it, “just things”—is far too broad and could allow the Government to regulate anything under this clause, with little or no clear limit or definition.

The lack of clarity here is a significant issue, not least because businesses and producers rely on clear, specific regulations to know what is expected of them and to ensure that they remain compliant. Under this clause, they are left in the dark. What exactly are we talking about when we refer to “other characteristics”? Are we talking about the design of products, marketing methods or even the raw materials that are used in manufacturing? Small businesses and start-ups are especially vulnerable to such unclear regulations, as they may struggle to interpret or comply with such an open-ended provision.

This provision, in effect, gives Ministers the power to define and change the scope of regulations without sufficient clarity or transparency. Ministers could, under this clause, make regulations to cover an incredibly wide range of product characteristics, creating significant uncertainty for the market. We believe that this is an unacceptable level of ministerial discretion. With such a clause, the Government could, in effect, regulate anything and everything related to products. We do not think that we can afford to pass a Bill that leaves businesses and consumers in the dark and subject to the whims of ministerial power. This clause should be completely rewritten or removed. If the Government cannot provide a more specific targeted framework for these regulations, we must consider removing it entirely on Report.

With Amendment 19, there are the same issues. At present, there is no clear definition of what constitutes the “use of products”, nor any explanation as to how the Government intend to regulate it. This lack of clarity presents a significant issue, as it allows Ministers broad and undefined discretion to determine how products should be used and how they are to be regulated. This could easily lead to overreach, and, given how the Government have argued so far in some areas, regulations could be imposed with little or no accountability or scrutiny, leaving businesses uncertain about the future of their operations.

I am very pleased that the Minister has talked repeatedly about giving businesses certainty, particularly in aligning with EU regulations. However, we need more in the Bill to suggest certainty in the areas that I have just described, and I hope that he will be able to provide some reassurance.

[Lord Leong (Lab)]

My Lords, as technology and regulation continue to develop, we need new powers to address future threats and hazards and to ensure a continued supply of safe, accurate and compliant goods.

I thank my noble friend Lady Crawley and the noble Lord, Lord Fox, for their Amendments 12 and 13, and the noble Lord, Lord Foster, who introduced the latter. I agree that we need a robust product safety framework that can reflect the latest risks and hazards and keep consumers safe and protected. The Government have worked hard to ensure that the powers in the Bill capture the multitude of products that fall within our product safety framework, as well as new products that might be placed on the market and present risks to consumers in future.

For the purposes of the Bill, products are defined as

“tangible items that … result from”

a “method of production”. This definition ensures that we can capture a wide range of manufactured products marketed or used in the UK, from cosmetics to complex machinery. There are a number of instances where our current regulation and product safety work covers software: for example, where certain products are reliant on software, or our work to enforce certain software security requirements under telecommunications legislation. Following my noble friend Lady Crawley’s comments on smart doorbells, I confirm that an app connected to a smart doorbell would be covered by the Bill where it affects the physical safety of the product. The Product Regulation and Metrology Bill would ensure that our general ability to regulate the safety of all products can take account of software, as well as the impact of software on the performance of any particular product.

Let me assure noble Lords that we have carefully considered the scope of products that we seek to cover, and we are future-proofing as much as we can by allowing regulations to also cover intangible components of physical products. This includes things such as software, as I mentioned, where they form part of a tangible product. As such, the Bill will allow us to regulate interconnected products in so far as the safety of the physical product is affected. In this way, we can ensure that we are able to regulate the role of these intangible components in the risk that physical products may present.

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[Lord Foster of Bath (LD)]

I am grateful, because this takes this back in a sense to an earlier group. The Minister has again referred to the issue of installation. Can he say categorically, on the issue of use, whether use will always include installation—or is it that it “may” include installation, as he said? Is it “will” or “may”?

[Lord Leong (Lab)]

I can give the noble Lord the assurance that it is “will”.

[Baroness Crawley (Lab)]

My Lords, I thank my noble friend the Minister and the noble Lords, Lord Sharpe and Lord Foster, who have contributed to this short but useful debate.

I will not repeat the valid and important points that have been made, but I ask the Minister to have another look at the Bill’s definition of “product” in the light of our discussion this afternoon. However, I accept his explanation of software regulation going forward: that was an important point he made. For now, I beg leave to withdraw the amendment.

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[Lord Sharpe of Epsom (Con)]

My Lords, I thank my noble friend Lord Holmes for his superb introduction to this group. I also thank the noble Baroness, Lady Brinton, for confirming my suspicion of dentists.

I shall speak in general terms because I cannot improve on the eloquence with which my noble friend Lord Holmes put his arguments. To return to the point, these amendments illustrate the limitations of Clauses 1 and 2, I am afraid. These amendments have considerable merit on a stand-alone basis but, in aggregate, they—Amendments 75 to 78 in particular—would in effect seek to define artificial intelligence. This is obviously a fast-moving and rapidly evolving subject; frankly, it deserves a national, never mind parliamentary, debate, as my noble friend Lord Holmes eloquently argued. AI will clearly demand definition and regulation, as the noble Lord, Lord Foster, rightly pointed out. Philosophically, I am not even sure that it qualifies as a product in the traditional sense; frankly, what is in this Bill suggests that we do not really know.

I cannot help thinking that some of the arguments made by the noble Lord, Lord Leong, in our debate on the previous group reinforce this point to some extent. AI can be benign, obviously, but the same application might not be. So, how do we define risk in these terms, even if it regards only the temperature of cheese? I therefore question whether this Bill is the right vehicle for these amendments or whether AI deserves a stand-alone debate and argument. The fact that they are in scope again illustrates, as I said earlier, the inherent weaknesses of Clauses 1 and 2. They are too broad and lack definitions. Ideally, they should be removed; at the very least, they should be extensively rewritten and tightened. I hope that the Government will listen but, if they do not, I will certainly have conversations with my noble friend Lord Holmes about what we shall do next.

[Lord Leong (Lab)]

My Lords, I thank all noble Lords and noble Baronesses who have spoken. The use of software and AI in physical products covered by our product regulation regime is still in its early days. It is important to take the opportunity of this Bill to ensure that future regulation can keep pace with technological change.

The amendment tabled by the noble Lord, Lord Holmes, would require a review of all product regulations in terms of how AI may impact them and a specific labelling requirement for AI. The Bill gives powers to ensure that product regulation can be updated or new regulations can be passed to cover emerging risks. They include measures such as labelling and verification requirements. However, mandating specific measures in the Bill would limit our ability to determine the most effective ways to protect consumers. A more flexible approach will allow us to adapt as this technology evolves and to ensure that protections remain robust and relevant.

To be clear, this Bill does not seek to regulate digital products or artificial intelligence in and of themselves; it is focused on the regulation of physical products and future-proofs our ability to keep product and metrology regulation up to date with emerging technologies. The Government have a wider programme of work on the regulation of artificial intelligence, where, in most cases, the UK’s expert regulators are responsible for enforcing the rules on AI in their domains; we are working with regulators to ensure that they have the resources and expertise to do this effectively.

Additionally, as set out in the King’s Speech, the Government will bring forward separate legislation to ensure the safe development of AI models by introducing targeted requirements on companies developing the most powerful AI systems. We will undertake a full public consultation to hone these proposals before presenting them to Parliament in due course.

The noble Lord, Lord Holmes, raised the issues of data protection and intellectual property. As we know, UK GDPR and the Data Protection Act 2018 form the legal framework for protecting personal data in the UK; this already covers things such as personal data, photographs and voice recordings.

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[Lord Sharpe of Epsom (Con)]

My Lords, I thank all noble Lords for introducing their amendments in this group. I shall briefly speak in favour of Amendments 48 and 71. I thank the noble Baroness, Lady Crawley, for bringing attention to the critical issue that addresses the responsibilities of online marketplaces and also, if I may, pay tribute to her wider work in this area as well as that of my noble friend Lord Lindsay, who is not in this place but whose exemplary work as president of the Chartered Trading Standards Institute deserves a mention.

This sector has grown exponentially in recent years and plays a dominant role in modern commerce. This amendment, therefore, highlights essential duties for online marketplaces. For example, a 2023 TSB study found that Facebook Marketplace accounted for 73% of purchase fraud cases. If you think about fraud and its growth in terms of the British crime statistics, that is a significant percentage of British crime, not just online crime. Over one-third of adverts on Facebook Marketplace are scams, we are told, so this amendment would help to level the playing field by ensuring that online marketplaces meet the same safety standards as physical retailers. This would foster fair competition and ensure that businesses prioritising consumer safety are not undermined by unscrupulous practices.

It is vital that we ensure online marketplaces, which facilitate the sale of billions of products, do not become conduits for unsafe goods or fraudulent activity, as all noble Lords have rightly highlighted. Without robust regulations, consumer trust and market integrity are at significant risk. We ask noble Lords to take seriously this amendment to uphold consumer protection, market fairness and safety standards, and think that the Government ought to recognise the urgency of addressing these concerns and act decisively.

On Amendment 71, I support it as a necessary step to protect consumers in the rapidly growing online marketplace sector. The extension of liability to online marketplaces and others under Section 2(3) ensures that those who facilitate the sale of unsafe or defective products are held responsible. Such measures are crucial to maintaining consumer confidence, especially as online shopping becomes so dominant.

We think it is essential that the Government protect consumer rights in all the marketplaces, especially online. We urge the Government to listen to those two amendments in particular but, frankly, there is merit in all the amendments we are debating in this group, and I hope to hear some positive news from the Minister.

[Lord Leong (Lab)]

My Lords, before I respond to this group, I say to the noble Lord, Lord Sharpe, that I will write to him in respect of the points he has raised.

I thank all noble Lords for their contributions to this debate and for Amendments 21, 22, 32, 45, 48, 71 and 117 to 124. These amendments have raised important points on the scope and application of the Bill’s powers, and I hope to provide clarity and reassurance. Around one-third of UK retail sales are now conducted online, but our product safety legislation has not kept pace with changes in shopping habits, in particular the development of online marketplaces and other platforms.

Online platforms may sell goods themselves and/or provide a platform for third-party sellers—in the UK or aboard—including consumers, to sell goods. The most well-known online marketplaces in the UK are probably Amazon, eBay, ASOS and Etsy, and others are widely used. The online marketplace industry in the UK is booming. In 2023, the UK e-commence market was valued at close to £137 billion and is projected to grow to £152 billion this year. I thank the noble Lord, Lord Sharpe, for setting out the landscape of online fraud and scams on online marketplaces; we really need to take note of that.

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[Baroness Brinton (LD)]

I thank the Minister very much for the detail he has gone into in his answer, but there are two types of regulation. The one he has described is the one that you would expect the Government, trading standards and other bodies to take. But, in litigation terms, if somebody bought an electric bike in good faith, who would they sue? Paragraph (h) does not make it clear. This is not purely about the parameters of the products and the Bill; it is about the consequences of having something that is very general. I think platforms will say, “It’s nothing to do with us”, and the individuals will say, “But I’m not part of the chain, as described”. I am genuinely struggling to understand and I wonder whether the Minister can help me.

[Lord Leong (Lab)]

I thank the noble Baroness for that; I will come to it. We are talking about product liability to some extent; I have a paragraph on it in my brief, if she will bear with me for a moment.

Amendments 32 and 45 highlight some of the different actors in online supply chains that may need to be captured appropriately in these new requirements. The Bill gives powers to introduce requirements on online marketplaces to improve the safety of products sold online. These requirements can be tailored and updated appropriately to reflect the wide range of online marketplace models, and other relevant supply chain actors and their activities, now and in the future. Clause 2(3) is therefore sufficiently broad to enable requirements to be introduced on any persons carrying out activities in relation to a product. This could include, where appropriate, private individuals selling products via online marketplaces, whether in return for payment or free of charge.

I will now focus on Amendments 117 to 124, which seek to broaden the definition of online marketplaces. The definition of online marketplaces in the Bill has been created in a way that is broad enough to capture the full range of online marketplace business models, including social media platforms such as TikTok Shop, which was mentioned earlier. I assure the Committee that all the changes proposed in the amendments are captured within the existing definition. For example—and of relevance to Amendment 123—the expansion of the term “marketing” within the definition of an online marketplace is not required due to the definition of “marketing” within the Bill, meaning the “making available” of products. This in turn is defined as goods

“supplied or advertised for distribution or use on the market, whether in return for payment or free of charge”.

Amendments 117 and 122 in the name of the noble Lord, Lord Foster, seek to change the definition of an online marketplace, replacing “internet” with “internet service”, as defined in the Online Safety Act 2023. The definition we have used in the Bill includes a service on any other platform by means of which information is made available over the internet. We are therefore confident that the issue the noble Lord raises in his amendments is covered by the Bill as drafted.

I also thank the noble Lord, Lord Foster, for his clarification about data and GDPR being captured by the Data (Use and Access) Bill. I shall read Hansard and confirm accordingly. I totally agree with him that all unsafe products should never be allowed to be offered for sale on any online marketplaces, whether original or second-hand. We have to address his point about accountability. Who is accountable to be held responsible for some of these unsafe products?

The Bill also includes a power in Clause 10(2) that allows for the definition to be amended later by regulations, if this were necessary to capture any future models not captured by the current definition. I will come back to the issue of product liability.

Amendment 71, tabled by my noble friend Lady Crawley and spoken to by the noble Baroness, Lady Brinton, would allow the Secretary of State to make provisions to ensure that online marketplaces can be held liable for products purchased via their platforms. The primary route to seek damages for harm caused by defective products is through the Consumer Protection Act 1987. Depending on the specific facts, an online marketplace may have responsibility under this legislation. The Government are currently reviewing this legislation and we will consider the UK’s product liability regime holistically, including the question of how it should apply to online marketplaces. This is not a change that we would seek to make without considering all the evidence, so we do not want to pre-empt this important work by adding to the scope of the Bill.

Product liability also covers products that extend beyond the scope of the Bill, including, for example, food and medical devices. A considered review of this area would be the most appropriate way to ensure that our product liability laws are up to date and fit for the future and to take account of the broad-ranging interests in this body of law. I will keep the Grand Committee updated on the Government’s progress with this review and plans for wider engagement.

I say to the noble Lord, Lord Jackson, and other noble Lords: we have listened to the debate and reflected on all the points made. We are aware of the Grand Committee’s strength of feeling on a number of points, including the scrutiny of secondary legislation. With that, I hope that I have been able to reassure noble Lords that these amendments are therefore not required to achieve their laudable aims. Consequently, I would ask for the amendments in this group not to be pressed.

[Baroness Brinton (LD)]

Clause 1(5) says that

“‘marketing’ means making available on the market”,

which is a much shorter definition than the one that the Minister just read out at the Dispatch Box. Is he telling me that I am not correct in saying that I market a product on eBay when I put it up on eBay?

[Lord Leong (Lab)]

Sorry, can you repeat that?

[Baroness Brinton (LD)]

This is very important, because this is partly about liability and partly about the clarity in the Bill about who has responsibility. Whether it is a buyer or, as I think the Minister argued, an individual seller, someone has to tell them that they have to follow the regulations, and they need to know how to do that. When he read out the definition of marketing in his speech, he gave a whole sentence more than is included in the definition in the Bill, which very simply says,

“‘marketing’ means making available on the market”.

It goes on to discuss “related terms”, but they are not relevant to my problem. While he ponders between Committee and Report, can he look at that? More than one of us is likely to come back with amendments on Report on this issue.

[Lord Leong (Lab)]

I thank the noble Baroness. We are trying not to be too prescriptive because it is constantly changing. I am sorry about this, but the Bill defines “marketing” as

“making available on the market”.

Clause 10, line 8, states,

“a product or goods … supplied or advertised for distribution or use on the market”—

[Baroness Brinton (LD)]

That is exactly what happens with a private individual. They will advertise an item on eBay. The language the Minister is using is what I would describe as the old-style manufacturing and business model. It does not take into account all the comments that people have made about where online marketing is in the 21st century. Therein lies the problem, and I would be very grateful if the noble Lord would look at that.

[Lord Leong (Lab)]

I thank the noble Baroness for that as well. Online marketplaces are changing overnight. I have just learned over the weekend of dropshipping. Dropshipping means that if someone orders a product on eBay, the person supplying it is not eBay or whoever claims to be on eBay. It is dropshipped by AliExpress straight to that buyer’s home. How are we going to control that? How are we going to capture that? That is why we cannot be too prescriptive. We need to have the flexibility to address ever-changing marketplaces. That is what this Bill is trying to do. If the noble Baroness is still unclear or unsure about this, perhaps we can have another follow-up meeting so we can discuss this in depth.

[Baroness Brinton (LD)]

I think a number of noble Lords who have participated in this debate might be interested in a meeting, if that is okay. I shall very briefly respond to the Minister to say that flexibility is fine, until the point at which there is nobody to hold accountable. That is the problem.

[Lord Leong (Lab)]

The Bill is drafted in this way to address who is going to be accountable. My invitation to all noble Lords to a meeting stands, and I welcome each and every one of them. I hope this amendment can be withdrawn.

[Lord Lucas (Con)]

My Lords, I am very grateful for the long and detailed reply given by the noble Lord, Lord Leong. I recommend a meeting with him to anybody. He is a most welcoming and courteous Minister, and you get good results out of a meeting with him. If, on rereading what he has said, I have any further questions, I shall attend the meeting. For now, I beg leave to withdraw the amendment.

Product Regulation and Metrology Bill [HL]

Lord Leong Excerpts

Committee stage
Wednesday 27th November 2024 Grand Committee

[Lord Fox (LD)]

My Lords, very briefly, and complying with time constraints, I warned your Lordships and the Government when speaking to another group that the skeletal nature of the Bill allows everybody to superimpose all their worst suppositions on it. We have just heard a thorough example of that from the noble Lord, Lord Sharpe.

I am of course here to help. In considering previous Bills, it helped when the Government published their draft code of practice between Committee and Report, so that we could get an inkling of their thinking. Doing so will not change our need to address the skeletal nature of the Bill, but it might allay some of our worst fears about the intention, and guide us in wording the amendments we could table on Report to help tie things down a little more, along the lines of the fears outlined by the noble Lord, Lord Sharpe. Can the Minister say whether a code of practice is planned, and undertake to show us a draft of it between now and Report?

[Lord Leong (Lab)]

My Lords, I thank all noble Lords for their detailed consideration of the Bill, and especially the noble Lord, Lord Sharpe, for his thorough exposition of his amendments, based on his experience at the Home Office and previously as an enforcement officer. He obviously knows a lot about the various amendments he has tabled.

I hope to clarify the Government’s position and explain the reasons behind the approach we have taken. First, I will address the use of delegated powers in the Bill, noting the concerns of the Committee.

Product regulation must legislate for innumerable kinds of products, ranging from heavy machinery to children’s toys. This is best done through regulation, due to the amount of very technical and scientific detail required. In some cases, sectors can be covered by general requirements. However, often they require specific tailored regulations that recognise their individual requirements. For example, a penalty for failure to properly mark a product “harm suffered” is likely be different when comparing a highly sensitive product in a nuclear energy installation versus a lower-risk product.

To proportionately reflect the dangers of a sector, requirements, enforcement powers, offences and penalties must be tailored. This is how the regulators operate at the moment, with over 2,500 pages of technical product safety regulation on the statute book. Alongside reviewing this existing legislation, we will need to consider on an ongoing basis whether there are emerging products or hazards that would benefit from specific rules.

Product regulation is a regulatory area that we have seen go through significant disruptive change with the growth of e-commerce, and this looks set to continue with AI and 3D printing. The activities conducted by different kinds of businesses have changed as well. The spine of the existing system was codified in primary legislation based on bricks-and-mortar businesses, and that led to uncertainties and gaps in duties, penalties and enforcement powers.

--- Later in debate ---

[Lord Lansley (Con)]

I apologise for interrupting the Minister, but Amendment 60 asks who the relevant authorities are. Paragraph 3 of Schedule 5 to the Consumer Rights Act 2015 tell us in statute, as things stand, who the domestic enforcement authorities are. That is not in subordinate legislation—it is in primary legislation. The Minister appears to be taking a list that is in primary legislation, which is amendable by regulation, and turning it into something that is a power to specify by subordinate legislation. What was wrong with retaining the enforcement authority list in Schedule 5 to the Consumer Rights Act and adding to or subtracting from it as necessary?

[Lord Leong (Lab)]

I thank the noble Lord for that point. As I said earlier, as it stands the relevant authorities are exercising public functions—that is, the Secretary of State or the Health and Safety Executive, in the examples that I gave earlier. However, because of the evolving and changing nature of the new products on the market, we may need more people with specific technical knowledge. We do not want this Bill to straitjacket us so that, every time we need to appoint somebody, we have to come back with new primary legislation.

[Lord Lansley (Con)]

But can the Minister tell us why the list in primary legislation under Schedule 5 of that Act, which has been amended from time to time since 2015 by regulation, is not a suitable basis for proceeding in future? What is wrong with using that list?

[Lord Leong (Lab)]

Personally, I do not see why there is anything wrong with it—but in this Bill itself, I am trying to say that we need the flexibility. I just have to continue.

Further clarification of powers and functions would restrict the ability for enforcement regulations to provide powers needed to enforce new product and metrology regulations. We must enable flexibility so that we do not create gaps in enforcement powers now or in the future. We intend to plug the gap in enforcement by making regulation applicable at the border, so that enforcement can take place before unsafe or non-compliant products are sold.

I understand the good intentions behind these amendments but, equally, I hope that I have resolved the concerns that led to them. The Bill provides simple, flexible powers that will help enforcement authorities to fulfil their roles. I submit that we have balanced parliamentary scrutiny with the necessary flexibility in a way that best serves the rule of law. It is for these reasons that I ask the noble Lord to withdraw his amendment.

[Lord Fox (LD)]

I asked a specific question about publishing the code of practice in advance. Can I have an answer, please?

--- Later in debate ---

[Lord Leong (Lab)]

I thank the noble Lord for that. We would expect regulators and authorities to carry out enforcement in line with the regulators’ code, which I am happy to share with noble Lords.

[Lord Lucas (Con)]

My Lords, the debate ranged a long way beyond my amendment, and I shall not attempt to summarise it. I suspect that I shall be listening to many of the arguments again at Report, specifically those from my noble friend Lord Sharpe of Epsom and perhaps the noble Baroness, Lady Crawley, too. In his reply to my amendment, I felt that the Minister rather missed the point, which is that, no, they do not have the powers at the moment. That is why this amendment has been tabled, because they are saying that they do not have the powers. Yes, you can name a product and have it taken off, but if it appears in 100-plus different guises, which all claim to be different but are actually the same, you are stuffed. That is what I am trying to get at. I shall come back to this at Report, after taking further advice.

I am also grateful to the noble Lord for reminding us of how overregulated our nuclear industry has become and that allowing it to continue to be the subject of such a ridiculous free for all—resulting in us paying five times more than it costs the Koreans to build a nuclear power plant—is not something that should be waved away in the breadth of the powers that we have in this Bill. I beg leave to withdraw my amendment.

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

My Lords, I will be very brief indeed. I have learned a lot from this brief debate and thank both noble Lords for their expert explanations. As a novice in this subject, I cannot think of a single possible objection, frankly, to either of the amendments from the noble Lord, Lord Fox, and my noble friend Lord Lansley. I hope the Government will welcome these as an example of well-informed common sense and give due consideration to some sort of amendment along these lines. I believe the Government to be sincere in their intention to promote growth and innovation, and it seems to me that both these amendments would, in some form or another, help to deliver that. If the Government do that, we will be supportive.

[Lord Leong (Lab)]

My Lords, I thank the noble Lords, Lord Fox and Lord Lansley, for their Amendments 34 and 35. When I saw the first amendment, I had to go and check what SEPs means. Now, after speaking to officials, I think I know a little bit and I welcome the opportunity to address the issues raised regarding software products that rely on standard essential patents, or SEPs.

These amendments go far beyond the intended focus of this legislation by expanding the scope of regulatory powers. Due to their complexity, the regulation of SEPs should not be reduced to a short provision in a Bill that was not drafted with the intention of regulating in this sphere. Any policy measures need to achieve a balance between rights holders being able to appropriately protect and enforce their rights, and users’ ability to access such technologies and innovations through fair and appropriate licensing forms.

However, I agree with the noble Lords that this is an important issue. The Intellectual Property Office has already engaged extensively with industry and business to determine whether any change to the framework for SEPs is necessary in order to ensure that businesses can license SEPs effectively and fairly. This engagement has included a call for evidence and views, and a questionnaire has been sent out to small and medium-sized enterprises. In response, the IPO has already launched a SEPs resource hub—an information resource that helps to address the very problem the noble Lords have identified. The IPO is also considering whether to consult formally next year on measures, as indicated by the noble Lord, Lord Lansley, and further to improve transparency in the SEPs ecosystem and enable more efficient dispute resolution. Any such consultation would be subject to ministerial decision, and we are currently working on that. In the meantime, I assure noble Lords that the IPO is continuing informal engagement with industry on both this matter and the SEPs ecosystem more generally. I hope that is reassuring to the Committee.

While I agree that this is an important issue, this Bill is not the right avenue to address the problems that the noble Lords raise. I therefore ask that they withdraw or do not press their amendments.

[Lord Fox (LD)]

I sort of thank the Minister for his response, but not much, because I think he could have acknowledged that this is a problem, rather than that SEPs exist, because it is a problem. Whether or not the Bill is the solution to it, the Department for Business and Trade should have an interest in solving that problem, but it did not seem that there was much appetite for that. Perhaps the Minister could disabuse me of that by acceding to the suggestion of the noble Lord, Lord Lansley, to have a meaningful round table with the right people for us to further this discussion. If this is not the avenue to deal with it, we need something else, because it is a real and present problem that needs a meaningful solution.

While the efforts of the IPO are clear, the point of the noble Lord, Lord Lansley—I should call him my noble friend in this case—is that the IPO needs more power and something needs to be done. If it is not this, it needs to be something else.

[Lord Leong (Lab)]

I want to be very clear that the Department for Business and Trade wants to support businesses of all types and sizes, but we have to be fair as well, so as not to burden too many SMEs with regulations and financial costs. This area is being led by the IPO but, at the same time, there is a way that the Department for Business and Trade can engage with the IPO. I am than happy to arrange a meeting between the noble Lords, Lord Fox and Lord Lansley, and officials from the IPO and the Department for Business and Trade.

[Lord Fox (LD)]

I thank the Minister for that offer, which I am sure we will take him up on. If the Government wish to unburden small and medium-sized businesses, solving this problem would be a slam dunk. With that, I beg leave to withdraw Amendment 34.

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

My Lords, I thank my noble friend Lord Lansley for introducing his amendments so incredibly clearly and expertly. It is obvious that international standards are vital for facilitating global trade. Products that adhere to international standards are more easily accepted across borders. They reduce trade barriers, open new markets for UK business and so on. They ensure that UK products can continue to compete internationally and maintain their high reputation for quality and reliability.

Aligning product requirements with international standards ensures that UK consumers also benefit from high levels of safety. This alignment builds consumer trust, as consumers know that the products they are buying meet rigorous global benchmarks. Amendment 43 specifies that this requires consultation. It is vital that consultation takes place with experts. In principle, we absolutely support the spirit and intent of these amendments.

[Lord Leong (Lab)]

My Lords, I thank the noble Lord, Lord Lansley, for tabling Amendments 38 and 43. I know from when I was on the Opposition Benches that he brings great expertise to this House, debating legislation as varied as the Trade Act 2021, the Procurement Act 2023 and the Bill before us today. His amendments raise important points about the role that international standards can play in domestic product regulation and in ensuring a strategic approach to their delivery and implementation.

Regarding Amendment 38, I reassure the noble Lord that Clause 2(6) enables product regulations to continue to reference international standards to support regulatory compliance, as is the case for medical devices. Provision is already made in current product regulations for the ability to designate a standard adopted by an international standardising body.

We work closely with all departments, including the Medicines and Healthcare products Regulatory Agency, and will continue to work with them to ensure the supply of safe and compliant products. However, each responsible department must individually consider the best approach for its own area.

Before the Secretary of State designates the standard for products regulated under the Bill it is assessed by government. The standard may be designated fully, with restrictions or not at all, depending on how far the standard ensures the relevant product requirements. Therefore Clause 2(6) sufficiently addresses the noble Lord’s concern. There is also no need to specifically reference the ability to designate international standards because that provision is already covered in product safety sector-specific legislation already on the statute book.

[Lord Lansley (Con)]

Which legislation is the Minister referring to? Is it not Part 2 of the Consumer Protection Act, which is able to be repealed by this legislation?

[Lord Leong (Lab)]

I have been told by officials that it is a specific product regulation.

[Lord Lansley (Con)]

Where is the power? Is it in the Consumer Protection Act?

[Lord Leong (Lab)]

I will write to the noble Lord on that.

On Amendment 43, the Government published a memorandum of understanding with the British Standards Institution on 16 September, of which there are copies here available to noble Lords. This sets out in respect of its activities as the UK’s national standards body its role in supporting government policy and acting in the UK’s national interest in the international standards-setting arena. This includes supporting UK policy to strengthen the global approach to standardisation and maximise UK influence.

Within the international standards system the UK already occupies a strong leadership position through the BSI’s membership of international and non-EU private sector European regional standards organisations. The BSI also manages a significant number of important committees in those organisations. In its role, the BSI systematically adopts international and European standards that representatives of UK stakeholders have influenced and withdraws standards that are no longer relevant. This includes internationally agreed standards designed to support regulatory compliance to UK product legislation.

In Articles 2 and 3 of the memorandum of understanding, the Government and BSI agree on the primacy of international consensus and that the two parties will co-operate with each other on international standards policy, while Article 4 ensures that the BSI provides the necessary standards the Government require for UK regulations. The Government are in the process of finalising a document entitled “The UK Government’s Public Policy Interest in Standardisation”, which is referenced in the MoU with the BSI, that explains why standards are a key factor in support of a number of government policies. It also reinforces the policy of influencing international standards and the importance of maintaining a constructive relationship with the BSI.

Given the close collaboration and the mechanisms in place, I believe that the objectives of Amendment 43 are already being met on the points I have just outlined. I hope that I have been able to provide sufficient reassurance to the noble Lord that what he seeks to achieve is not only already possible through the Bill, but also common practice across a range of sectors. If helpful, I will ask my officials, following Committee, to provide further information on the important role that international standards play in the UK system. With that in mind, I respectfully ask the noble Lord to withdraw his amendment .

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

Again, I think that my ignorance probably suggests that the public ought to be slightly better informed about that. Maybe they are; maybe it is solely me being ignorant. I do not know.

The other thing that struck me, while I again say to the noble Lord, Lord Redesdale, that I like his Amendment 56, is that surely we need to be a little bit careful about exploding Amazon trucks if they are this unstable. I will leave that thought with him.

There is, finally, a third subset of safety issues that I thought about when the noble Lord was talking about bikes. It is about those, Lime bikes in particular, that are left lying in the middle of the road unexpectedly as you go round a corner—he said, speaking from personal experience.

All these amendments have considerable merit. I am very interested to follow them and will consider supporting them.

[Lord Leong (Lab)]

My Lords, I thank the noble Lords who have spoken, in particular the noble Lord, Lord Foster, for speaking on behalf of the noble Baroness, Lady Brinton. The issue of lithium-ion battery safety is rightly getting a lot of attention and I am grateful for the opportunity to discuss it. I also mention the work of the noble Lord, Lord Redesdale, who has tabled a Private Member’s Bill on this same topic and with whom I have had valuable discussions during the passage of this legislation.

The Government have already taken significant steps to protect people from the dangers posed by products containing lithium-ion batteries. The Office for Product Safety and Standards has been working with colleagues across government and industry to identify the root causes of safety issues associated with lithium-ion batteries and to ensure that steps are taken to protect consumers and remove dangerous products from the market. We are also working with UK businesses to ensure that they comply with regulations. In addition, we have collaborated with fire and rescue services to identify products involved in incidents and have taken the appropriate action when unsafe products are identified.

Since 2022, efforts have resulted in 20 separate product recalls and 22 other enforcement actions for unsafe or non-compliant e-bikes or e-scooters. The OPSS has issued 26 withdrawal notices to eight online marketplaces, two manufacturers and 16 separate sellers to halt the sale of two dangerous e-bike battery models manufactured overseas by Unit Pack Power—UPP—that were discovered during fire and rescue investigations.

In terms of regulatory change, we need to ensure that any regulation is effective at stopping harmful products reaching the market. We also need to make sure that good businesses, which are in the majority, are not undercut by these unscrupulous traders.

The Bill is designed to provide powers across a broad range of products, including lithium-ion batteries. It does not highlight particular sectors that are in need of regulation. Noble Lords will appreciate that a very large range of products are covered by the Bill; therefore I would be hesitant to draw out lithium-ion batteries or specific measures in it. That would also limit our flexibility to work with all interested groups to identify the most effective way to tackle this issue. Today it may be lithium-ion batteries, while tomorrow it may be magnesium batteries, sodium batteries, salt or seawater—all of which may pose some safety features. So we need the flexibility to identify those new products on the marketplace.

Indeed, during Second Reading of the Bill in the name of the noble Lord, Lord Redesdale, a number of Peers highlighted that battery technology is changing. That is part of the reason why the Product Regulation and Metrology Bill works in this flexible way, as I stated earlier. It is to ensure that future regulations are able to take account of developing technologies.

We are, none the less, considering what change will make a meaningful difference to lithium-ion battery safety. My department has commissioned extensive research from the Warwick Manufacturing Group to better understand battery safety, including compatibility issues. This research is being finalised and we expect to publish it in due course. This will help us identify the root causes of battery risks and options to better protect consumers.

We want to take action about these unsafe products. We cannot commit to a timescale as we want to take the right action—but we do want to take action. One area where we have been very clear about the need for action is products sold via online marketplaces. I thank the noble Lord, Lord Foster of Bath, for his Amendment 49—and his well-informed advocacy in this area—that would require online marketplaces to take reasonable steps to ensure that products containing lithium-ion batteries sold on their platform are compliant.

In addition to the action I just mentioned, the OPSS wrote to major online marketplaces earlier this year, expressing concerns about the availability of unsafe products online. The OPSS has issued online marketplaces with legal notices that prohibit the supply of unsafe products. However, while much has already been done to keep people safe, our product safety regulations could go further.

As mentioned at Second Reading, we will use the Bill to clarify and modernise the responsibilities of online marketplaces in secondary legislation. These requirements will build on best practice to create a proportionate regulatory framework where online marketplaces take steps to prevent unsafe products from being made available to consumers. This will help prevent unsafe goods, including unsafe lithium-ion batteries, from reaching UK consumers.

The enforcement provisions in Clause 3 enable the introduction of enforcement powers for the purposes of monitoring and investigating, and securing compliance with product regulations. A requirement for the production of safety certificates that the noble Lord, Lord Foster, seeks as part of Amendment 49 could be implemented using the Bill’s powers as drafted. As I said, we are keen to continue working with noble Lords and others to identify the regulatory work that would be most effective.

Specifically on Amendments 55 and 56 on bikes, e-bikes and lithium-ion battery products sold on online marketplaces, we agree that online marketplaces should take steps to provide relevant information to consumers so that they can make well-informed purchasing decisions. This is also important to bridge the gap between the information consumers see before a purchase online, compared to the high street, where they can see the product and packaging.

In general terms, the Bill would enable us to introduce requirements on online marketplaces, including the provision of specific information, for the purpose of reducing or mitigating risks presented by products or ensuring that products operate effectively.

I thank the noble Lord for raising another important issue where consumer information can be beneficial to provide product traceability. As he discussed with me previously, this might help to deter the sale and assist the recovery of stolen bikes. The Home Office works closely with policing and academic leads to examine what more can be done to tackle the disposal market for stolen goods. We will therefore engage with the Home Office on this topic to explore whether product regulations could contribute to crime prevention. I will ask my officials to organise a meeting with the noble Lord and officials from the Home Office and other relevant authorities.

I also thank the noble Lord for his Amendment 56, which seeks to require online marketplaces to put in place a return policy for products containing lithium-ion batteries for the purpose of appropriate battery disposal. The Environment Act 2021 provides powers for the Government to introduce new requirements on online marketplaces with respect to the take-back of lithium-ion batteries and products containing lithium-ion batteries. Under the existing producer responsibility legislation, producers of industrial batteries, which include e-bike and e-scooter batteries, must take back waste products free of charge on request. Ministers are currently reviewing proposals to consult on reforms to UK batteries regulation before setting out next steps on battery disposal.

At this point, I wish to mention that I have spoken to my noble friend Lady Hayman of Ullock, Parliamentary Under-Secretary of State at Defra. It is clear to me that noble Lords will discuss the issue of disposal of lithium-ion batteries.

I hope this assures noble Lords that the Government take the issue of lithium-ion battery safety extremely seriously. We have already taken enforcement action and are keen to work with all interested groups to ensure that further regulatory change is effective. Consequently, I ask the noble Lord, Lord Foster, to withdraw his amendment.

Before I sit down, I wish to say that my private office has sent an invitation to noble Lords who have expressed an interest in visiting the OPSS. I very much hope they will take up that offer.

[Lord Foster of Bath (LD)]

My Lords, on behalf of my noble friend Lord Redesdale, I thank the Minister for his kind offer to him. I am sure the Minister will understand that I will want to go and put a wet towel over my head and read very carefully what he has just said in response to this group of amendments. However, I say to him that reading a list of successful examples of unsafe products coming into the UK by the OPSS is something I did myself in a previous debate. It does not indicate that we have got it right. The figures on the number of fires from lithium-ion batteries, for instance, are going up dramatically, so something is not quite right.

The problem, which the Minister touched on both in this answer and the answer he gave to a previous group when I raised the issue of high-risk products, is that the current arrangements are somewhat discretionary, and not at all clear so that we know what they are. For animal products, there is a very clear procedure: everything has to be checked for whether it is low risk, medium risk or high risk. Earlier, I proposed that we do exactly the same for all products. I am grateful to the Minister for agreeing to meet me and other people about that.

In the light of that and the discussions we will have, for the time being I beg leave to withdraw my amendment. However, I assure the Minister that we will come back to these issues at a future stage.

Product Regulation and Metrology Bill [HL]

Lord Leong Excerpts

Committee stage
Wednesday 11th December 2024 Grand Committee

[Lord Sharpe of Epsom (Con)]

My Lords, before I start on these amendments, I thank the noble Lord, Lord Leong, for the generous letters that he sent the Committee after previous sessions, which answered a number of questions. I generally commend the Government on their spirit of co-operation on these matters.

I am sincerely grateful to my noble friend Lord Holmes for introducing this critical amendment and for supplying his PIN. Like my noble friend Lord Kirkhope, it very much appeals to me too, because the principle of being inclusive by design reflects a visionary and much-needed step forward in ensuring that products in the UK are accessible and equitable for all members of society—as my noble friend so eloquently and powerfully set out.

The establishment of an inclusive-by-design standard underscores our collective commitment to creating a society where accessibility and inclusion are the norm and not the exception. Moreover, inclusive design benefits everyone, as the noble Baroness, Lady Bennett, pointed out. Features designed for accessibility, such as voice commands or larger interfaces, often enhance usability for all users. For businesses, I would have thought it an opportunity to innovate and differentiate themselves in a very competitive market. For consumers, it is a guarantee that their needs are being respected. So I have no hesitation at all in supporting Amendment 79.

I am also happy to support Amendments 52 and 53. I will not say much about them except to add that Amendment 52 also addresses pertinent and indeed poignant national security or—perhaps this is a better expression—security of supply concerns. A complete national understanding of supply chains makes unarguably good sense.

In conclusion, I wholeheartedly support Amendment 79 and am very sympathetic to Amendments 52 and 53, and I urge the Government to think seriously about them.

[Lord Leong (Lab)]

My Lords, I thank all noble Lords who have spoken in this debate, and I specifically thank the noble Lord, Lord Holmes, for his amendments. During the second day in Committee, the noble Lord illustrated his knowledge of and passion for the subject of AI.

I turn first to Amendment 53 on the review of large language models. We have already discussed the intersection or interaction between this Bill and AI in a previous group, and I will briefly restate some of the key points I made in that debate which are relevant here. Evidently, the use of AI in products is still in its infancy. How exactly this technology will develop remains to be seen, but we have drafted the Bill in such a way that it keeps pace with technological change; Clause 2(2)(a) allows regulations to take account of intangible components of a physical product.

However, the Bill does not and will not regulate digital products or artificial intelligence in and of themselves. Instead—I hope this reassures the noble Lord, Lord Holmes—the Government are developing a wider policy around AI, which I am sure will take into consideration proposals for AI safety legislation as announced in the King’s Speech. I recognise that noble Lords keenly anticipate the detail of these proposals, so I assure your Lordships that my noble friend Lady Jones will update the House in due course.

The Office for Product Safety & Standards is considering the use of AI in products and the regulatory challenges for product safety associated with that. We are just at the start of that process but know that it will become more important as technologies develop. I will ensure that the House is kept up to date with progress on this work.

Amendment 52 addresses product traceability and responsibilities within supply chains, including digital supply chains. I agree with noble Lords that it is essential that those responsible for producing or importing products are identifiable. Existing regulations already require relevant supply chain parties to maintain necessary documentation for tracing product origins and, as we consider updates to product requirements, we will also review these traceability provisions to ensure that they are fit for purpose. The noble Lord, Lord Fox, mentioned CPTPP, which in fact comes into force this Sunday when the UK becomes a full member. I suppose we will just have to review the application of this whole supply chain and traceability, and monitor how it goes.

[Lord Fox (LD)]

I thank the Minister, but perhaps there is another of his letters here—for which I also thank him. The CPTPP is not like the European Union—there is not a secretariat overseeing what is going on. If you think something wrong is going on, it is up to the Government to raise it. It would be useful to know how the department is now going to police or at least find out what it needs to deal with. Otherwise, it is essentially transparent.

[Lord Leong (Lab)]

I totally agree with the noble Lord. I will ensure that officials in the department look into this and either write to him or have a meeting on this.

Over the coming year, our priority will be continuing to address the sale of unsafe goods on online marketplaces—an area that noble Lords are right to highlight and on which they have demonstrated extensive knowledge and passion in the best traditions of this House. As outlined in the Government’s response to the product safety review consultation, we will also explore digital solutions, including the use of voluntary digital labelling, to streamline business processes and support authorities in monitoring product safety.

However, it should be noted that issues of traceability are much broader than ensuring the safety or proper functioning of products. This would bring in myriad other policy issues, such as the nature of global supply chains and cross-border jurisdictional arrangements. I believe that noble Lords would agree that these issues warrant careful discussion and debate, but they are distinct from the Bill’s purpose of ensuring the safety and functionality of products.

Amendment 79 relates to the creation of a mandatory inclusive-by-design standard. I am pleased to inform the noble Lord that the British Standards Institution has already developed and published a British Standard that provides guidelines for the adoption of an inclusive approach to the design of products. The standard sets out a strategic framework and processes to enable business executives and design practitioners to understand that inclusive design should be a core organisational driver.

I refer back to the example the noble Lord, Lord Holmes, gave of credit card payments. We have come a long way, but I still remember those zapping machines that zapped your credit card and you had to sign the receipt. That obviously creates a lot of situations where fraud can happen. Then we had the PIN, and nowadays contactless. I have been reading some articles before today’s debate, and some of the financial institutions are looking at mobile wallets, whereby an encrypted account number is embedded within the wallet itself. But these are early days, so we have to keep watching this area and see how it develops.

Furthermore, an updated version of the ground-breaking, government-sponsored, fast-track standard on inclusive data use in standards was published by the BSI in August this year and is free to download. This helps standards makers to work with data with inclusion in mind so that the standards produced are representative and include communities that are traditionally excluded, helping to minimise harm and deliver more robust products. Standards are voluntary in nature and the Bill, as with our current product safety regulations, continues to allow the use of standards to remain voluntary, avoiding potential barriers to trade.

I hope that the noble Lord is satisfied with the explanations given today and that the amendment will be withdrawn.

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[Lord Jackson of Peterborough (Con)]

My Lords, it is a pleasure to have the opportunity to contribute to your Lordships’ Committee. I apologise for not having been here throughout all the deliberations on the Bill. I was called away by the excitement of the Football Governance Bill, but I am back to speak to my Amendment 92.

This is pretty straightforward. That the Bill will be unamended is a big assumption, because I sincerely hope that the Government will see fit to bring forward their own amendments or accept opposition amendments on Report—I thank the noble Baroness, Lady Brinton, for her kind words. However, my amendment seeks to fill the gap in appropriate scrutiny and oversight of a very wide-ranging and pervasive Bill, particularly in this respect of potentially creating criminal offences arising from non-compliance.

It is vital that, if new offences are created or if other powers are exercised by Ministers in this clause, it should be subject to some form of rudimentary scrutiny by Parliament. That is why I have tabled this amendment, which says that at least 30 days before making such provisions the Secretary of State must put that rationale into the Library of both Houses in the form of an Explanatory Memorandum.

Let us just remember what this clause on enforcement of product regulations does. It allows, by regulations, the Government to appoint inspectors to

“enter, inspect and search … seize and retain products or evidence of non-compliance … require a person to retain or provide a document or information … dispose of a product or require a person to dispose of a product”.

Those are pretty draconian powers, and they have significant ramifications for civil liberties, the unwarranted interference into the lawful operation of markets, and the potential undermining of due process and norms in the criminal justice system. Most importantly, there is a lack of accountability.

It goes without saying, of course, that I strongly support the amendments from my noble friend Lord Sharpe of Epsom. In fact, I agree with all the amendments in this group, including those from the noble Baroness, Lady Brinton. I do so because—it bears repetition—this is an egregious example of skeleton legislation, as the Delegated Powers and Regulatory Reform Committee found. I also had an opportunity to look at paragraph 12 of the Guidance for Departments on the Role and Requirements of the Committee—the Delegated Powers and Regulatory Reform Committee. I give Ministers half points rather than nil points, because they have actually done half of what the memorandum asks them to do under the heading “Criminal offences”. It says:

“Where a bill creates a criminal offence with provision for the penalty to be set by delegated legislation, the Committee would expect, save in exceptional circumstances, the maximum penalty on conviction to be included on the face of the bill”.


We have seen that, so that is great. But it also says in that same paragraph—and the Government have not met this requirement—that

“where the ingredients of a criminal offence are to be set by delegated legislation, the Committee would expect a compelling justification”.

I am afraid, as with virtually all of the Bill but particularly and specifically on this issue of the creation of criminal offences, that skeleton legislation gives rise to significant risks of the creation of offences, with punishment meted out to businesspeople and others associated with commerce without proper scrutiny and oversight.

For those reasons I strongly support all the amendments in this group, and I look forward to the Minister addressing the particular issue of what are the compelling reasons that necessitate that wording in the Bill and why the Government have chosen to go in that direction. I hope he will think again on Report about perhaps amending the wording in the Bill, as we have argued for today.

[Lord Leong (Lab)]

My Lords, I thank noble Lords for their amendments in this group related to criminal offences. This is an important area, and I am grateful for the knowledgeable and informed contributions in this debate, demonstrating the significant expertise in this House. My response sets out the general principles relating to criminal offences, but I will try to answer many of the various questions that noble Lords asked.

As I mentioned previously, I am very aware of the concerns that noble Lords have raised on delegated powers and the importance of consultation and scrutiny more generally. In particular, I am grateful for the thoughtful and comprehensive reports of the Delegated Powers and Constitution Committees. I have mentioned this before: noble Lords will be aware that we have provided responses to both committees, and my colleague, Minister Madders, and I gave evidence to the DPRRC. I was very grateful for the opportunity to explain the Government’s approach to these issues.

I begin by stating a central point. The severity of the harm caused by breaches of regulations across different product sectors varies. To proportionately reflect harm, offences and penalties must be tailored to individual sectors and duties.

I hope noble Lords would agree that, with regard to criminal offences, the rule of law is best served by precision. Only by having criminal enforcement provisions alongside product requirements can proportionality be ensured. Take, for example, a penalty for failure to properly mark a product: the harm will be very different for a highly sensitive product within a nuclear energy installation versus a lower-risk product.

As well as creating issues of proportionality, codifying criminal offences and penalties in the Bill would likely lead to enforcement gaps later. Offences would not correspond directly to new duties created for existing supply chain actors or responsibilities placed on new actors who enter the supply chain over time.

Lord Bingham’s principles require that the law be accessible and, so far as is possible, intelligible, clear and predictable. Setting out the details of offences and penalties in the Bill would undermine those principles. It would necessitate drafting speculative penalties to fit duties yet to be created. That would leave ambiguity over to whom offences may apply in future and create statutory maximum penalties that would be disproportionate for some actors.

Lord Bingham’s principles go further to support the approach of tailoring clear, proportionate offences and penalties that correspond to supply chain actors’ duties as they arise over time. If we instead place the detail in primary legislation, we risk undermining those crucial principles by locking in terms that become ambiguous over time as business models and products evolve, and with penalties that can cater to only the most serious version of the offence. Setting the maximum penalty in primary legislation means that the penalty can be calibrated to only the most serious version of the offence, leaving a broad discretion to judges to determine the appropriate sentence for less serious cases. Legal certainty and predictability of applicable penalties are better served by specific, tailored provision being set out in secondary legislation.

Noble Lords have highlighted that the DPRRC, in its report on the Bill, recommended that elements of criminal offences are set out within primary legislation. The Government value the work of the DPRRC and the incredibly important role it plays. We have considered its recommendations carefully within the department. However, the approach taken to setting out criminal offences within regulations is not novel. Other Acts that underpin broad regulatory regimes allow for the creation of criminal offences in regulations, including the Building Safety Act 2022, the Retained EU Law (Revocation and Reform) Act 2023 and the European Union (Withdrawal) Act 2018. I also highlight some examples of existing product regulations that set out criminal offences and penalties, such as the Nagoya Protocol (Compliance) Regulations 2015 or the Simple Pressure Vessels (Safety) Regulations 2016.

Noble Lords may also be interested to note that, to ensure proportionality, the maximum criminal penalties that may be implemented by regulations are set out in the Bill and follow existing precedent, as seen in sector-specific regulations such as the Electrical Equipment (Safety) Regulations 2016. This is a key point. Our approach provides this strong safeguard that enables discretion to set lower and more proportionate penalties in secondary legislation, which will also have parliamentary oversight. We submit that secondary legislation ensures parliamentary oversight but also the flexibility required to ensure that we can implement proportionate criminal offences that comply with the vital principles underpinning the rule of law.

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[Baroness Brinton (LD)]

My Lords, the Minister has been very helpful in explaining about the affirmative process, and he has talked about the Explanatory Memorandum, but he has not responded to my questions about the consultation with the Home Office, the Ministry of Justice and the relevant agencies. If that happens, will it form part of the Explanatory Memorandum? My concern is that this is all still led very much by the Department for Business and Trade and does not take account of the concerns and pressures faced by the Home Office, the justice system and their respective arm’s-length bodies.

[Lord Leong (Lab)]

I thank the noble Baroness for the question. I will need to come back to her on it because I want to be absolutely clear that I am giving her the correct information, rather than me saying something now on the fly.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank all noble Lords who contributed to this brief discussion. The noble Lord, Lord Leong, praised our expertise. Can I just say that any expertise he thought he might have spotted in my remarks belongs not to me but to my noble friend Lord Sandhurst, who was very helpful. He cannot be here, I am afraid, and I am not a lawyer.

Unfortunately, in spite of the detailed explanation of the Government’s intentions supplied by the noble Lord, Lord Leong—I am very appreciative of it—I am only partially reassured. I still have some concerns, so I will go back to Hansard and study his remarks carefully, particularly those related to Bingham.

In answer to the noble Lord, Lord Leong, on the list of bodies, I have not seen the letter, so I apologise again if I have repeated something that he has already addressed, but it is fair enough that he agrees that the rule of law deserves provision. I totally agree—that is fair enough—but it does not really seem to explain why there should not be a list of specific enforcement authorities, as per Schedule 5 to the Consumer Rights Act 2015. That seems to give too much latitude, but perhaps the letter explains that, in which case I will cheerfully withdraw these remarks.

In relation to the question asked of me by the noble Baroness, Lady Brinton, we considered following her example, obviously, but we also felt that leaving out subsection (9) would in effect render subsections (10) and (11) null and void. But I totally accept that the noble Baroness has a point about how that could be interpreted, so I will go back, have a look at it and consider what we do next. For now, I beg leave to withdraw the amendment.

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[Lord Sharpe of Epsom (Con)]

My Lords, I will speak to Amendments 72 and 73, and I thank my noble friend Lord Trenchard for signing them. Clause 4 is a short clause dealing with emergencies. It allows for product regulations

“to be disapplied, or to apply with modifications, in cases of emergency”.

It also provides:

“The disapplication … may be made subject to conditions”.


That is it. I wonder what happened to the rest of the explanation that a clause of this type surely deserves. Perhaps the parliamentary drafter was using only headlines and forgot to fill in the blanks.

These amendments are designed to introduce some checks and balances. As the clause is currently written, there is no definition of what constitutes an emergency. There is no definition in Clause 10, which deals with interpretation. Who defines an emergency? How long might an emergency last? How will emergency provisions be enforced? The committees that we have talked about so much have been very clear. We have discussed this many times. The Bill is skeletal in nature and introduces a number of Henry VIII powers. I am only surprised that this clause was not added to the list of clauses that they think should be removed from the Bill in its current form.

My Amendment 72 is merely an attempt to seek answers to some of those questions and to apply a minimal level of parliamentary scrutiny. I simply do not think it is right that an undefined individual or body could introduce undefined emergency powers of an unspecified duration without a basic level of scrutiny —frankly, that way despotism lies.

My Amendment 73 expands on this and would introduce an element of ongoing scrutiny. Again, I can see no reason why the Government would disagree with this because, in their response to the Delegated Powers Committee’s report, they said that

“the Department is committed to … engage with stakeholders … including in cases of emergency”.

I have included that exact form of words in my amendment, as well as requirements to justify the continuing need for these powers, to assess their impact and to introduce some time limits. I cannot see any reason at all why the Government would not accept this amendment, given that, in effect, they have already committed to doing pretty much what it says. I beg to move.

[Lord Leong (Lab)]

My Lords, once again I thank the noble Lord, Lord Sharpe, for his amendment. I begin by reaffirming that this Government take their responsibility to parliamentary scrutiny very seriously. We have listened carefully to the views expressed and we will reflect on them as we move forward. It is always our aim to strike the right balance between thorough oversight and addressing the technical and practical demands of product regulation.

Amendments 72 and 73 seek to ensure that the use of emergency powers is transparent and proportionate. I fully appreciate the intentions behind these amendments, and I reassure the noble Lord, Lord Sharpe, that we believe that the Bill already provides robust mechanisms for oversight.

Clause 4 is intended to be used in rare emergency situations. It is introduced in this Bill following the recent example of the Covid-19 pandemic, when there was a shortage of personal protective equipment. To be clear, this clause is not about quickly implementing regulations on new products; it is about emergency situations where there could be a need to temporarily disapply or modify existing regulations to allow current products to be brought to market much more quickly. Any regulations made under Clause 4 are subject to the draft affirmative legislative procedure, ensuring that both Houses can scrutinise and approve them. We believe this process provides a balanced and proportionate mechanism for oversight and accountability, ensuring thorough scrutiny.

The Government are also committed to developing a clear framework of how the policy will work in practice, and this will be done in consultation with stakeholders. However, we do not believe it will be necessary to formally lay this framework before Parliament, as the oversight arrangements provided by the draft affirmative procedure for any secondary legislation under Clause 4 are believed to be sufficient.

The Office for Product Safety & Standards will take the lead in developing the framework and will publish guidance on the conditions and procedures for using these emergency powers. The guidance will then be made publicly available to Members of this House and relevant committees on the GOV.UK website which, if needed, can be used to supplement any future scrutiny on emergency measures. In addition, Clause 4 is intended to provide a proportionate response to emergencies, and conditions can be applied which will be context specific. Therefore, any disapplication or modification of regulations will be targeted, with safeguards in place to ensure public safety remains paramount.

As the House can appreciate, emergencies can be unpredictable and cannot always be anticipated in advance. Imposing an initial fixed three-month sunset period and review process for extensions risks reducing the Government’s ability to respond effectively to emergencies that may evolve over time. Instead of applying a fixed three-month sunset period to all regulations, we believe that each regulation in response to an emergency should be targeted and tailored to its unique circumstances. This approach ensures that the measures remain both proportionate and effective, addressing the specific challenges of the emergency and the product or situation involved while avoiding unnecessary constraints.

[Lord Jackson of Peterborough (Con)]

The Minister is making a powerful argument, but he raised the issue of Covid. He is aware, of course, that it is quite possibly the case that you can expedite fast-track legislation in extremis. He will no doubt know that between 1989 and 2009, 15 Northern Ireland Bills that were terrorism and security-related were fast-tracked through both Houses. So, in a fundamentally very serious emergency situation, you can expedite fast-track primary legislation. I offer that as a suggestion to the Minister.

[Lord Leong (Lab)]

I thank the noble Lord for that, and I am sure the officials will have taken notice as well.

I must also highlight that, in line with the Government’s commitment to transparency and informed decision-making, proportionate impact analysis will accompany future secondary legislation. This will be prepared in accordance with the Better Regulation Framework, ensuring that Parliament has access to evidence-based assessments that support effective scrutiny.

I hope that I have been able to provide reassurance on all these matters and assure the noble Lord, Lord Sharpe, that the Government have carefully considered the importance of parliamentary scrutiny and sought to strike a careful balance in relation to emergencies. I am happy, as always, to meet the noble Lord or, for that matter, any other noble Lords to discuss with them further our approach in this area. On that basis, I ask for the amendment to be withdrawn and for the other amendments in this group not to be moved.

[Baroness Brinton (LD)]

I am grateful to the noble Lord, Lord Jackson, for his question because it reminded me that when all the primary and secondary legislation on Covid was going through, most of the references to “emergency” were the definition in the Civil Contingencies Act. That Act is not defined in this Bill, and “emergency” is used loosely on its own. I wonder whether there is a bear trap there. If the department means to use “emergency” in the sense of the Civil Contingencies Act, it may be better and more helpful to name it. If not, will the Minister explain why the use of the definitions in the Civil Contingencies Act are inappropriate?

[Lord Leong (Lab)]

My Lords, I really do not know the answer to that. Obviously I will find out and write to the noble Baroness.

[Baroness Brinton (LD)]

I thank the Minister—I am grateful.

[Lord Leong (Lab)]

I am told that we were advised by counsel that this word is more flexible to use. I do not know whether that is sufficient but perhaps we can explore that further.

[Lord Sharpe of Epsom (Con)]

I again thank the noble Lord, Lord Leong, for his detailed explanation. However, the fact is that that explanation and the recent comment about flexibility rather illustrate again, I am afraid, the point about the Bill. Let us go back to the DPRRC report, Democracy Denied. It states:

“Skeleton legislation signifies an exceptional shift in power from Parliament to the executive and entails the Government, in effect, asking Parliament to pass primary legislation which is so insubstantial that it leaves the real operation of the legislation to be decided by ministers”.


I am afraid that in spite of the noble Lord’s reassurances, that is still very much where we are.

I accept that emergencies are unpredictable. Of course they are, by their very nature: they are rare and emerging situations. But I do not accept the three months argument made by the noble Lord, which strikes me as inconsistent. Surely three months is enough to define and decide on the relative importance, scale or urgency of an emergency. I can see no reason at all why any emergency cannot be defined over the course of 12 weeks, and that would have gone for Covid as much as anything else.

There is some inconsistent logic in the Minister’s replies. I am partially reassured, and obviously some considerable thinking has gone into his replies, which I appreciate, but we will reserve the right to revisit this situation. I beg leave to withdraw the amendment.

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However, the dangers that this Bill seem to pose to our economy are nothing compared to what will happen if we do not require under law an active regular assessment of the impact on the wider economy, businesses and the SMEs that make up most of the UK’s business sector—as well as our customers, without whom businesses cease to exist. For these reasons, I hope that the Government will accept the amendments.

[Lord Leong (Lab)]

My Lords, I thank all noble Lords and noble Baronesses for their contributions in the debate on this grouping of amendments; in particular, I thank the noble Lords, Lord Fox and Lord Sharpe, for their amendments. This Government are committed to supporting businesses as we get the UK economy growing.

I begin with Amendment 82 in the name of the noble Lord, Lord Fox, which was moved by the noble Baroness, Lady Brinton. He specifies that regulations made under Clause 5 of the Bill

“must have regard for the impact of metrology regulations on small and medium sized enterprises”.

The noble Lord has also proposed the publishing of impact assessments of affirmative regulations, to be laid every six months after the Bill’s implementation.

Similarly, Amendments 103 and 104 in the name of the noble Lord, Lord Sharpe, propose publishing a report assessing the Bill’s impact on consumer choice 12 months after the Bill is passed, as well as another report every two years on the economic impacts of the Bill. The noble Lord’s Amendment 104B would further require the Secretary of State to present a report to Parliament detailing the impact of regulations made under the Bill’s powers on SMEs.

I am happy to confirm that the impact of any new regulations will be fully considered through the development of proportionate impact analysis. As I said before, the Better Regulation Framework is the system that government uses to manage the flow of regulation and understand its impacts, including on SMEs and micro-businesses. On 7 December, the Government launched their new Business Growth Service to ensure that it is easier for SMEs to find government advice and support, giving them more time and money.

In line with the Better Regulation Framework, for regulations where significant impacts—above £10 million per year—are anticipated, full impact assessments will be published. For regulations with lower anticipated impacts, a proportionate assessment impact analysis will be completed. These assessments will, as a matter of course, consider the impacts of regulations on SMEs. Furthermore, officials currently routinely engage with SMEs and stakeholders to shape policy, including in the light of emerging technological and industry developments, and to identify and address any disproportionate burdens. The OPSS regularly engages with a small business panel as part of policy development.

I hope that this confirmation provides reassurance to the noble Baroness, Lady Brinton, and the noble Lord, Lord Sharpe, on this important area, and I am grateful to them for raising it today. The Government remain committed to supporting SMEs and recognise the vital role they play in the UK economy. As such, the Bill will allow the Government to update product and metrology regulation to avoid extra cost to business and provide continued regulatory stability. It will also allow the Government to end recognition of EU requirements where this is in the interests of businesses and consumers. The Bill will enable the Government to introduce proportionate product safety requirements that protect consumers and create a fairer playing field for law-abiding businesses.

As some noble Lords will know, before I came to this place I was a serial entrepreneur all my working life. I understand how micro-businesses and SMEs work. SMEs spend most of their time creating and growing the business. They do not want additional costs or regulations impacting their business. Having said that, all that businesses want is a level playing field where they know the rules of the game and what regulations are in place. Imposing additional regulation is not the intention of this Government. We are constantly consulting SMEs to ensure that, whatever regulation is in place, it does not impact SMEs and micro-businesses.

As I said, growth is the Government’s number one priority. On 14 October, we published a Green Paper, Invest 2035, setting out a credible 10-year plan to deliver the certainty and stability that businesses need to invest in the high-growth sectors that will drive our growth mission. This industrial strategy will create a pro-business environment and support high-potential sectors and clusters across the country. By giving the UK the flexibility to adapt its own regulatory framework to keep pace with international regulatory developments and respond to global trends, the Bill supports economic growth and innovation.

This flexibility ensures that the Bill supports economic growth—as I mentioned—reduces unnecessary regulatory burdens and ultimately benefits businesses, including micro-businesses and SMEs. However, introducing a statutory reporting obligation would risk duplicating existing processes, diverting resources and delaying the implementation of timely and effective regulations that provide businesses and consumers with the certainty they need.

I am sure that many noble Lords know that the EU’s general product safety regulation comes into force this Friday 13 December. Under the terms of the Windsor Framework between the UK and the EU, we have to apply it in Northern Ireland, so we will publish on the Government’s website clear guidance to SMEs that want to export to Northern Ireland and the EU. We will prepare a statutory instrument to implement a new enforcement regime in Northern Ireland to allow this GPSR to be enforced. This is a requirement of the Windsor Framework.

I mention this to show that there are regulations that SMEs have to abide by—this is one of them—that will impose a certain amount of burden on SMEs, especially in the run-up to Christmas. Many small businesses will now find it very difficult to export to Northern Ireland and Europe if they do not have a legal representative in the country to verify their goods.

As I have outlined, I believe that the very laudable sentiment behind these amendments is already covered by existing practice, so I ask noble Lords not to press them.

[Baroness Brinton (LD)]

I am grateful to the speakers in this debate and to the noble Lord, Lord Sharpe, for his Amendments 103, 104 and 104B. They aim, I think, to achieve the same objective as Amendment 82 in the name of the noble Lord, Lord Fox, but in more detail.

I am with the Minister—I thank him for his response —in saying that more paperwork and more regulation is not what we on these Benches wanted to achieve in Amendment 82, which is why it says that any regulations “must have regard for”. I hope that the Minister will take that on board. I want to ask him something; perhaps he might write to me, if he intends to write anyway. He kindly talked about the different types of impact assessment, including whether they would be full or proportionate. We completely understand that those would happen, but will those impact assessments specifically highlight SMEs? In other words, will an untutored eye flicking through see “effect on SMEs” in bold, and then something underneath it? I am seeing nods from the Minister, and I look forward to his letter.

I am glad that the Minister raised the extra burdens on firms either selling into Northern Ireland or the reverse. It is not just about that: over the last few years, we have seen very small businesses having sometimes to double the number of their administrative staff to cope with, for example, things such as music groups touring across Europe. The objective has to be keep that paperwork down as much as possible. Obviously, I will confer with my noble friend Lord Fox, and I look forward to the Minister’s letter. We may return with this later.

[Lord Leong (Lab)]

Before the noble Baroness withdraws, I can confirm that, when we do the impact assessment, we take SMEs into consideration as well.

[Baroness Brinton (LD)]

I beg leave to withdraw the amendment.

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[Lord Leong (Lab)]

My Lords, I thank my noble friend Lord Liddle for his amendment in this final group in the Committee on this Bill. He raises a very interesting point. I will start by briefly explaining the operation of the Schedule of the Bill. Noble Lords will appreciate that the Bill’s definitions have been drafted to capture the range of products covered by existing regulations. This means that the Bill needs to cover products as diverse as toys, cosmetics, fireworks, lifts and pieces of heavy engineering. The Bill therefore defines a product as

“a tangible item that results from a method of production”.

To place some limitation on this scope, the Schedule lists some exclusions. These refer to certain products that do not require coverage by this Bill because, for example, they are regulated by separate legislation. The Schedule includes an exclusion for aircraft. The noble Lord’s amendment would widen this exclusion to include all products and equipment intended for use in civil aviation.

As my noble friend has said, product regulation is not always as clear-cut as that. Many sectors have products feeding into them that span other sectors. Aviation is an important and complicated field when it comes to safety. It is right that there is an extensive suite of existing legislation, overseen by the Department for Transport, that covers that. It is not the Government’s intention to create any confusing parallel structure of regulation.

However, we need to ensure that, by excluding a wider range of products that can be used in aviation, we do not accidentally exclude dual-use products that might also need to be captured by this Bill. It cannot be the case that a manufacturer or other supplier can evade regulation on the grounds that, as well as supplying consumers, they also supply the aviation industry. My noble friend has raised an important and nuanced issue. Aviation safety is a serious matter. The Government will definitely reflect on this matter, and I am happy to have discussions with my noble friend before Report.

As this is the last group in our consideration of the Bill in Committee, I would like to express my thanks to all noble Lords for their thoughtful and constructive contribution during this stage of the scrutiny of the Bill. I would also like to thank my officials and all the staff here in the House, including the clerks, Hansard and the doorkeepers, for ensuring that the Committee has run as seamlessly as possible.

As I have said many times during today’s debate, the Government have valued the debates we have had, and the issues raised by all noble Lords. We have heard, clearly and loudly, the mood of the Committee on a number of areas. I can assure noble Lords that the Government will carefully reflect on all concerns. I give an undertaking that I will come back to noble Lords on these issues.

I look forward to continuing my constructive conversations with noble Lords as we approach Report to ensure that this important Bill is suitable to deliver the policy objectives that many in the debates have outlined their support of. With that said—and to ensure that noble Lords are not totally surprised—I would like to end on a familiar note and ask that Amendment 134 be withdrawn.

[Lord Liddle (Lab)]

My Lords, I am happy for Amendment 134 to be withdrawn. I am very grateful for the assurances the Minister has given me that this will be a matter subject to further consideration.