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

Mike Amesbury Excerpts

Wednesday 13th March 2019 General Committees

[Mike Amesbury (Weaver Vale) (Lab)]

I thank the Minister, and you, Mr Hanson; it is a pleasure to serve under your chairmanship. I sincerely hope there are no further pings. Hon. Members will be pleased to hear that I do not intend to offer a line-by-line commentary on the SI. It is vital that the regulation of UK chemicals and genetically modified organisms continues to operate effectively at the point at which the UK leaves the EU. Her Majesty’s Official Opposition will not oppose the instrument, as the intent is to ensure the operability of the relevant legislation.

The chemical and pharmaceutical industry adds £18 billion of value to the UK economy every year from a total annual turnover of £50 billion. It employs 500,000 people directly and through supply chains, and has annual exports of £50 billion, with 63% of companies in the sector exporting what they make to the world. That is the highest proportion of any goods manufacturing sector in the UK economy.

Sixty per cent. of the exports go to the European Union, and 75% of the imports and raw materials come from the European Union; that is a vital point. The chemicals industry has been and remains a major presence in my constituency of Weaver Vale and the surrounding area, so the regulations are of particular interest to my constituents and many major employers including Ineos-Inovyn and Tata Chemicals.

The regulation and labelling of chemicals is an issue not only for those who manufacture, produce and sell them, but for all of us who use them on a day-to-day basis, whether directly in the form of household goods or medical products, or indirectly in relation to the food we eat and the environment we enjoy. As the Minister said, that means it is vitally important that we get the regulations right.

Although we welcome the general commitment to ensure that chemicals and GMO legislation continues to operate effectively after Brexit and the apparent intent to avoid any deregulatory impact, we have a number of questions about how that will work in practice. We also believe that the instruments cannot properly be considered in isolation, without recognising a wider problem of the uncertainty and instability of Brexit for the chemicals industry.

There is a lack of clarity regarding the Government’s policy on genetically modified foods and what that policy will be in the future. The SI would give the Secretary of State for Environment the power to regulate genetically modified organisms within a research laboratory or biotechnological production facility that are not released into the environment. The Secretary of State has already said that the Government might take a positive attitude to gene editing to develop higher-yielding crops or more valuable livestock. The Opposition want to see guarantees that post-Brexit there will not be a more relaxed policy on GM than the one that the EU currently operates.

Crucially, the instrument is being laid at a time when the Health and Safety Executive—the body being tasked with picking up much of the work and responsibilities required to regulate the safety of chemicals and the workers’ rights mentioned by the Minister—is dealing with budget cuts of 40% from 2010 to 2017, and when the Government have yet to respond to the most recent tailored review.

In short, we recognise the need for this statutory instrument, but we have concerns about the mechanisms to be used for delivery. We believe that the context in which they are being taken—one of cuts and potential chaos—has made the situation much more difficult and even more risky than it might otherwise have been. As such, we have a number of questions about today’s proposals that need to be clarified. I intend to go through them in turn in the hope that the Minister may be able to answer some of them.

Paragraph 3.5 of the explanatory memorandum states:

“After Exit, the same UK regulatory scientists will recommend updates to ensure the continued protection of people, the environment, and the interests of UK business for the UK only, not as part of the EU system. Where ministers agree with the recommendation, they will issue a decision to this effect and the Health and Safety Executive (HSE) will then ensure that the updates are given effect from an agreed date, and alert duty-holders to changes.”

What processes are in place for any scrutiny and to challenge the Secretary of State about decisions on recommendations, particularly if there is a scenario where the Minister does not agree with the scientific recommendation?

At present, there is scrutiny of regulation by the European Parliament and by member states through the Council of Ministers, as well as supporting committees at EU level. The existing system allows for industry, trade unions, non-governmental organisations and technical experts to contribute to shaping regulation, and it is vital that there is no reduction in scrutiny, challenge or consultation. These regulations do not provide for any equivalent means by which stakeholders and experts in the field can help to ensure that regulation is robust and fit for purpose. Can the Minister confirm that the Health and Safety Executive will be given all the necessary funding and support to carry out its new responsibilities?

Paragraph 3.7 refers to the

“well-established policy of HSE to set fees to recover the full costs of its regulatory activities”.

What guarantees are in place to ensure that the HSE fee cost is considered proportionate and fair by all concerned, and that it accurately reflects the full cost of intervening? The tailored review of the HSE made clear the importance of the tripartite partnership for the HSE; indeed, assessing fair and reasonable costs can only be done on that basis. In the absence of a formal response to the report, it would be welcome to hear the Minister recognise the importance of the tripartite partnership for the Health and Safety Executive in ensuring good governance and effective health and safety.

Paragraphs 7.26 and 7.32 of the explanatory note refer to devolution. Given that we have no functional Assembly in Northern Ireland, how does the Minister intend to future-proof these arrangements with that and other devolved authorities? Paragraph 7.4 refers to the European Chemicals Agency’s IT system being replaced with a UK system. Has sufficient progress been made in developing that system, and have additional staff been put in place to carry out this function?

The current regulations set out arrangements whereby evaluations of active substances are distributed between all 28 member states, and deadlines set for their completion —currently 31 December 2024 for completion of the review programme as a whole. In paragraph 7.8, it is proposed that that be replaced by a UK stand-alone review of 488 active substances, and the regulations give the Secretary of State powers to make regulations, extend deadlines and specify other matters.

We are told that details of how such a programme would operate are currently under development; a progress report from the Minister would be greatly appreciated. There are other major questions and consequences. We welcome the Minister’s commitment that any reviews would be done to the same standards in protecting human and animal health and the environment, but might it mean some level of regulatory divergence, even for a short period of time, when some substances have been reviewed and passed fit or rejected in the EU, but not in the UK?

Since 2006, REACH—the European regulation on the registration, evaluation, authorisation and restriction of chemicals—has built up a comprehensive database on the safety of chemicals. The Government are now walking away from that vital source of data. Their current position appears to be that companies will provide all the data, but a survey by the Chemical Industries Association found that 75% of the companies taking part did not own the data that they would be required to register under a separate UK system. What assessment have the Government made of the ability of companies to provide the necessary data in the future?

We appreciate that fee recovery is suggested to cover costs in some cases, and that fees were payable to the European Chemicals Agency for some services, but in others—such as managing requests by suppliers for the use of alternative chemical names—fee charging was not planned. What guarantees are in place that the Health and Safety Executive has the capacity to undertake all the new functions and responsibilities assigned to it, given the scale of cuts that it has faced?

Is this new landscape not further evidence that the Government must urgently and constructively respond to the recommendations of the tailored review? The Opposition believe that the UK should continue to participate in REACH so that there is no reduction in scientific and technical collaboration with the European Union. More than 50 chemicals companies have already applied to use EU regulators for safety authorisations, to enable them to continue to do business legally in the event of a no-deal Brexit, as REACH authorisations held by UK companies would no longer be valid. That involves transferring registrations with REACH to EU-based companies, or asking customers to act as agents on their behalf.

Paragraph 10 of the explanatory memorandum sets out engagement with the chemicals industry in a no-deal scenario. A couple of roundtables, a few stakeholder meetings and a question and answer session are nowhere near sufficient to prepare for the massive major challenge that leaving the EU without a deal would present to a sector worth nearly £13 billion to the UK economy. That sector directly employs 100,000 people, many of them in my constituency, and it deserves better.

The Government appear unable even to respond adequately to the findings of those meetings. Paragraph 10.6 states:

“Consultations with stakeholders emphasised that they would welcome an approach that allows technical and scientific updates to the regulations be made in a flexible and timely way that will offer businesses sufficient time to make adjustments”.

Minister, we are two weeks away from exit day. Earlier this week, I received a letter from Inovyn that states that

“any disruption will adversely affect the competitiveness of our business and the potential for future trade and investment.”

It further states that UK businesses have invested in REACH to the tune of £0.5 billion and highlights concerns that that investment would be wasted in the case of a no-deal outcome. It also notes that contingency planning throughout the UK for a REACH alternative is already costing significant time and money. Those concerns are reflected by Tata and other chemicals organisations throughout the country.

The Government have not delivered updates in a flexible and timely way, or responded effectively to the industry’s concerns. The proposals are necessary given the situation that we are in, but the situation is not acceptable to the chemicals industry, those who work in it, or those who are tasked with enforcing it under a cloud of uncertainty, cuts and concerns. The Government must urgently deliver the clarity that the industry needs, and the funding and support that the Health and Safety Executive requires and deserves. The Opposition will continue to demand that they do so.

--- Later in debate ---

[Sarah Newton]

I very much appreciate the spirit of the debate and the support from the Opposition parties for these really important regulations, which will provide the clarity and certainty that we know the industry needs. I will respond to as many of the questions that have been raised as possible.

First, for the benefit of Committee members who are not quite so familiar with the chemical industry as others, many of the questions directed to me were about the REACH regime, which is not the subject of these particular regulations. Today, in the House of Lords, they are considering the REACH regulations, which is the major set of regulations that control the chemical industry more broadly. This SI deals with a related sub-set that sits alongside that regime.

The REACH regulations are the policy responsibility of DEFRA. I work closely with the Department on that, because the HSE will be the operational side of delivering that regulatory environment. I assure all colleagues that the HSE has taken its responsibilities to consult with the industry seriously and thoroughly. Those consultations started in February last year and the HSE has met with about 1,000 chemical businesses and held many stakeholder events.

I know from the feedback that I have seen that the HSE’s consultations and engagements with the industry, as it developed these regulations, have been welcomed. The thinking behind both these and the REACH regulations has been about minimising any disruption. They will grandfather a lot of the registrations over to make this as seamless as possible.

I was asked about our preparedness as regards computer systems. Of course, the words “Government” and “computer systems” sat next to each other fill most people with horror, but the computer system has been built and has undergone user testing. As far as I can see, we are well on track to be able to deliver the operational aspects of what we need to do.

[Mike Amesbury]

But the explanatory memorandum refers to using the current system, not the new system.

[Sarah Newton]

I was offering some reassurance about the REACH regulations. Although they are not what we are here to talk about today, I was addressing those concerns.