Chemicals (Health and Safety) and Genetically Modified Organisms (Contained Use) (Amendment etc.) (EU Exit) Regulations 2019

Lord McKenzie of Luton Excerpts

Thursday 21st March 2019 Lords Chamber

I turn briefly to the powers in this SI. The statutory instrument gives power to Ministers to implement new technical and binding legislation, without parliamentary oversight. Ministers will be able to: approve or reject the sale of biocidal products in the UK; devise their own classification and labelling scheme, which, unlike EU classification, will bind UK-based suppliers; and decide what chemicals go on an administrative list, which relates to what hazardous chemicals can be imported into the UK. In each case, Ministers will act following recommendations from the relevant agency—largely, the Health and Safety Executive and/or the Environment Agency. How can the decisions of the Secretary of State be challenged, particularly if Ministers go against the scientific recommendations they are presented with, for whatever reason? This is a really important issue.

[Lord McKenzie of Luton (Lab)]

My Lords, I thank the Minister for her introduction and explanation of these regulations. I acknowledge the contribution of the noble Lord, Lord Fox. Perhaps he might see it as a starter for 10 for Tuesday’s main event. He made some important points, particularly on data, and I am interested in the Minister’s response on that.

As should be clear from debate in the other place, we will not oppose the instrument, given its expressed intent to ensure that the regulation of UK chemicals and genetically modified organisms will operate effectively when the UK leaves the EU. We are mindful of other regulations that have been referred to and which have been tabled, including the draft REACH etc. (Amendment etc.) (EU Exit) Regulations 2019, which have been the subject of comment by Secondary Legislation Scrutiny Sub-Committee B. Its report has been drawn to the special attention of the House on the basis that the explanatory material laid in support of the draft regulations provides insufficient information on their expected impact and gives rise to issues of public policy likely to be of interest to the House. These regulations have been scheduled for consideration next week and are the responsibility of Defra. I do not propose to stray into this territory this afternoon in any detail, except where there is an overlap with these regulations.

My understanding is that the DWP has responsibility for the regulations before us today as it is the host department for the HSE. The HSE and Defra oversee several regulatory regimes which impact the chemicals sector. When approved, it is understood that the regulations will cover the whole of the UK and provide for an independent UK regulatory regime which maintains existing standards and protections. As the Minister spelled out, this afternoon we are concerned with: the biocidal products regulations, which govern the use and placing on the market of biocidal products; the classification, labelling and packaging of substances and mixtures regulations, a single market measure which applies to the supply of chemicals; the export and import of hazardous chemicals regulations, which require exports of limited chemicals to be notified to the importing country, with consent needed for some; and minor technical amendments to the GMO provisions, as we have heard.

Referring to the list in paragraph 2.6 of the Explanatory Memorandum, paragraph 2.7 states:

“If these changes were not made, several chemicals regimes in the scope of the instrument would not be fully operable when the UK leaves the EU”.


Can the Minister expand on that point and give us some specific examples?

The Government have chosen to amalgamate these instruments in one set of regulations and assert that this decision was taken to reduce the pressure on parliamentary time. These are complex issues. If the Government are following this route, it should be incumbent on them at least to produce an impact assessment. It is understood that one is available for the REACH regulations but not for those before us today. It has apparently been asserted that if the direct financial impact of the measure is below £5 million, there is no requirement for an impact assessment. If that is the basis of the claim for there being no need for an impact assessment, perhaps we could see a copy of that £5 million calculation.

Currently, scientific and technical updates are proposed, considered and adopted through the EU’s delegated decision-making arrangements. Under these new regulations, this will be done by ministerial decision following recommendations from a relevant competent authority or agency. Can the Minister give us a list of who was included in competent authorities and agencies for these purposes? Is there a risk that, in comparison to the breadth of the current arrangements, the UK will have a narrower updating arrangement? How can we be assured that best practice will prevail? The Explanatory Memorandum argues for this administrative procedure on the basis of efficiency and speed, and points to the precedent of the Veterinary Medicines Directorate. It seems that Defra is pursuing such an option for plant protection products. What happens when the UK advice under these arrangements diverges from the EU advice provided to entities within the EU? Is any process envisaged to reconcile the differing positions to get some impact on the market?

The HSE briefing reminds us that for biocides and pesticides regulations in future, the HSE will no longer be able to act as “lead authority” for active substance approvals and some product authorisations. Who will, and what does the Minister consider the consequences of this to be? How assured can we be that this will not lead to a change of policy?

As for classification, labelling and packaging, it is envisaged that all existing main duties of classification would remain the same and that we would adopt the UN globally harmonised system. This new UK mandatory classification is also to be hosted by the HSE. It is understood that this will involve all existing MCL substances plus new and revised entries as agreed. Can the Minister say something about how the process of agreement in these circumstances will proceed? What enforcement arrangements are envisaged?

We know that the HSE would also take on responsibility for an independent UK system in respect of biocidal products. This would involve applications for approval and authorisation going to the HSE, which would take on the role of ECHA. It is understood—this point was made by the noble Lord, Lord Fox—that active substance approvals and product authorisations would remain valid, but ongoing applications with the HSE for evaluation would need to be resubmitted. At what and whose cost?

Apart from its increased responsibilities arising under these regulations, as the debate on REACH identified, considerable additional responsibilities are envisaged for the HSE at a time when the organisation is going through significant budget cuts—I am reminded that the HSE has been six months without a chief executive. What assessment has been made of the capacity of the HSE to cope, as well as that of Defra and the Environment Agency? I have no doubt about the intellectual capacity of the HSE; it is one of the jewels in the crown of our regulatory firmament, although that is not always acknowledged by some members of the government party.

The Explanatory Memorandum seeks to address the financial position of the HSE. It appears to recite three situations—first,

“fees to recover the full costs of its regulatory activities”;

secondly,

“variable fees and charges dependent on the size of organisation involved”;

and thirdly,

“domestic fees and charges systems … proportionate to the actual cost incurred of intervening”.

The latter are seemingly adopted for these regulations and mean that there will not be full cost recovery. Is this correct? What is the estimated annual shortfall?

The SLSC specifically regrets that a financial analysis has not been provided which identifies the potential cost of the proposed regulatory regime, nor an assessment for the industry of a no-deal scenario. Will the Minister undertake to provide these? Debating these regulations has, if nothing else, reminded us how important the chemical sector is to the UK economy. This must be underpinned by robust and secure regulatory provisions. We look forward to the further deliberations next week.