Textile Products (Amendment) (EU Exit) Regulations 2018

Lord Stevenson of Balmacara Excerpts

Wednesday 21st November 2018 Grand Committee

[Lord Stevenson of Balmacara (Lab)]

My Lords, it has been an informative little debate, blessed as we are by the noble Lord, Lord Foulkes, to proceed in a relatively calm and considered way. I hope we can move smoothly to a conclusion.

The other two speakers have been supportive of the statutory instrument and I am not going to object to it either. The trouble with these things is that, however simple they appear on the surface, they raise questions in your mind. We have already heard examples of a couple of things that need to be responded to. I do not think that was done in any way to negate what is proposed, but it raises wider questions that we perhaps might return to at some future date.

I want to ask three or four questions of the Minister, and I am happy to receive the answers in writing if they are not available today. Most relate to the Explanatory Memorandum, which I thought was clear and good, and I congratulate the department on the way it has been produced.

I should just say that this is the first time I have dealt with an EU exit regulation. I think it might be sensible to lay down a few ground rules so that we can do it better as we go forward. There are several hundred still to come, or more, and, as others have said, if the department is at any point ready to define the total, that would be helpful for overall planning. For instance, I do not think it is necessary to circulate the annexe statements under the European Union (Withdrawal) Act 2018 Part 1 table of statements—a reference to that could perfectly easily be put somewhere and we could look it up for ourselves. That would save paper, complications and reading time.

Secondly, the department started—I do not know whether it is continuing—to write to Front-Bench spokespersons with details of certain SIs that were due to come forward, perhaps if there was something a bit more tricky or interesting about them. The trouble is, the letters became scattergun. I have had four. My noble friend Lord Grantchester has had six. Others may have had other numbers—I have not had time to ask round. If they are going to come at all, it would be helpful if they came to me as the leader of the group and I could disperse them. If they are not going to come, fine; that was a nice little flurry and it was very nice to get them, but the moment has passed.

My detailed points mainly concern the memorandum. Paragraph 7.6 says:

“The Textile Products Regulations provide sanctions and enforcement powers for UK market surveillance authorities (local authorities’ Trading Standards departments) to ensure compliance with the EU regulation”.


Of course, the burden here falls on trading standards departments, which, as we all know, have been suffering because of reductions in funding from local authorities. While the department, which has allocated additional responsibilities to trading standards departments, has also notionally allocated money to them, I worry that trading standards as a group is being asked to carry the burden of a lot of things which nobody has really costed or understood whether it is able to carry out the work. Have any discussions taken place with local authorities on this? For example, has a lead local authority taken responsibility for this, as is the case in some areas? Has it been discussed with the Trading Standards Institute? What is the rough estimate of the additional cost that might be involved?

The noble Lord, Lord Foulkes, mentioned paragraph 7.10 and issues around that. I have a similar point in relation to the functions of the Secretary of State. There are agencies currently in play which do work on the testing of products and related issues. Will the Office for Product Safety and Standards, which has responsibility for some of these issues, be involved in this process? The idea that the department is just going to absorb all this work seems slightly odd. Could a bit more clarity be provided on that?

The question of cost flows into the question of whether an impact statement is to be prepared. There is a general statement that if the costs are less than £5 million annually it will not be done. Changing over the whole system for all clothing manufacture in this country from one which was taking a template organised by the EU to a new one that takes its template from the UK will involve transitional costs. I would be very surprised if those were not close to £5 million. There is no particular point that I want to make here. I just wondered, as the department would have had to make a rough calculation of what the costs would be to invoke the de minimis threshold, whether the Minister might share it with us just so that we can have confidence that it is being done properly.

My other points are more generic. First, this is being done as a UK instrument and applies from its implementation date to the United Kingdom, yet there are within the United Kingdom a number of very specialist manufacturers of various textiles—I think of Harris tweed and things that relate to the particular wool that comes from Welsh sheep; Northern Ireland has its own distinctive history in linen. Why is this a reserved issue? If it is to be a reserved issue, what arrangements have been put in place to ensure that the devolved Administrations are involved in the process? The question is probably easily answered but raises a bigger point about how we might think about this in future, particularly as the Government have conceded on geographical indicators—GIs—and that therefore there will be quite a number of these, not necessarily related to textiles.

Secondly, the Explanatory Memorandum says that although no formal consultation was undertaken prior to the instrument being laid,

“discussions were held with industry experts and business representative groups”.

A little note about who was consulted and roughly on what areas would be helpful. I look forward to that confirmation from the Minister in due course.

--- Later in debate ---

[Lord Henley]

I will write in greater detail to the noble Lord, just to make sure that he is absolutely clear. In passing, on the question of correspondence, I give an assurance that from now on I will send all letters from my department on matters relating to SIs to the noble Lords, Lord Stevenson and Lord Fox: I will copy letters to one and the other. I am sorry if he has been confused: on some occasions I have written to the noble Lord and on others to the noble Lord, Lord Grantchester. I shall inform my office that in future it will be entirely himself. If the noble Lord, Lord Lennie, would like to receive those letters, I will send them to him too.

[Lord Stevenson of Balmacara]

In no sense was any blame to attach to the Minister personally: in fact, several of the ones that went to my noble friend Lord Grantchester were from his colleague Kelly Tolhurst. I got a couple from the Minister himself and my poor noble friend Lord McNicol got none.

[Lord Henley]

The poor noble Lord, Lord McNicol, got none, but I think I wrote to the noble Lord, Lord Lennie, on something. Anyway, between myself and my honourable friend Kelly Tolhurst we will look at our entire system and make sure that there is one recipient of all letters on the Official Opposition Front Bench and that similarly, the noble Lord, Lord Fox, will be a recipient of all other letters.

I move on to the question of the impact—the cost, as the noble Lord, Lord Stevenson, put it. After exit, the responsibilities for UK manufacturers or a business sourcing textile products from UK manufacturers, or importing them from outside, will remain the same; it will be the same for manufacturers. Anyone importing products from manufacturers in the UK would be putting a textile product on the market and so would become responsible for ensuring that it contains the appropriate label or marking and that it is accurate according to the retained EU regulation. The practical impact of this will be limited. I think any impact on business will fall far below £5 million annually and, as a result, we do not believe that a full impact assessment is necessary.

On exit day, UK and EU labelling laws will remain highly aligned. Textile products imported from the EU will therefore be compliant with the shared requirements and the saved EU regulation does not mandate any costly technical testing or the production of documentation as proof of compliance. Similarly, there would be no administrative costs at the border to demonstrate compliance. Many businesses already undertake compliance activities as part of their due diligence programmes. That includes asking for proof of fibre composition or procuring their own fibre composition test. As a result, it is unlikely that businesses would need to put in place additional checks to demonstrate compliance with the saved EU regulation. The Government will, in due course, provide further guidance to businesses to ensure that they have understood the requirements of the saved EU regulation.

The noble Lord, Lord Fox, asked about applications for new fibres. Businesses wishing to introduce a new textile fibre name or manufacturing tolerance will be able to make this application to the Secretary of State. The Government will, in due course, publish further guidance, including the process by which the Secretary of State will assess the various applications. Lastly, I was asked: will businesses have to apply to both the United Kingdom and the European Commission to have a new fibre name approved for both UK and EU markets? Yes, in a no-deal scenario, it will no longer be appropriate for the European Commission to approve new textile fibres which can be made available on the EU market and therefore they will have to apply to both. I hope that will not be an onerous burden.

As I said, I remain optimistic, as always, that we will reach an agreement with the European Union, but it is important and prudent to have a regulatory and legislative framework in place should we leave without a deal. That is entirely what this instrument ensures.