Draft Product Safety and Metrology etc. (Amendment) Regulations 2024

Nigel Mills Excerpts

Monday 13th May 2024 General Committees

[The Minister of State, Department for Business and Trade (Kevin Hollinrake)]

I beg to move,

That the Committee has considered the draft Product Safety and Metrology etc. (Amendment) Regulations 2024.

It is a pleasure to serve with you in the Chair, Ms Rees. To place many manufactured goods on the market in Great Britain, ranging from toys to machinery, manufacturers must ensure that products comply with the requirements of product regulations. Following EU exit, many EU product regulations were integrated into UK law and we introduced the UK conformity assessed regime, or UKCA, as our domestic product regulation approach in Great Britain. Since 1 January 2021, the UKCA has been in use alongside recognition of the EU’s CE and reversed epsilon markings.

That recognition of the EU’s CE and reversed epsilon markings is due to end on 31 December 2024. Many manufacturers with products in the scope of this draft statutory instrument would therefore have no choice but to meet UKCA requirements to legally sell their products in Great Britain. The Government know that businesses are facing increasing burdens, with cost of living pressures and global supply chain challenges. As part of our smarter regulation programme, we are minimising regulatory burdens where feasible, to reduce business costs and to help grow the economy. That is why we are introducing this instrument to continue the recognition of the EU requirements, using powers under the Retained EU Law (Revocation and Reform) Act 2023.

Last year, the Government held a series of roundtables to hear views from industry, including representatives from about 200 domestic and 50 international businesses. Industry in the UK and businesses that supply Great Britain from abroad indicated that ending CE recognition and mandating UKCA would cause issues for their businesses. It could increase costs and require duplicative processes, leading to higher prices and less choice for consumers in Great Britain. Some overseas suppliers also reported that they might reduce or stop sales to Great Britain entirely. This draft instrument will continue recognition of EU requirements, including the CE and reversed epsilon markings, providing businesses with the choice to use either EU markings or UKCA to place products on the market in Great Britain.

Furthermore, the draft instrument will introduce a fast-track UKCA measure, which will provide manufacturers with more flexibility when using the UKCA marking to place products on the market in Great Britain without compromising on the legal requirements. This instrument will apply to 21 product regulations managed by the Department for Business and Trade, the Department for Energy Security and Net Zero, the Department for Environment, Food and Rural Affairs, and the Health and Safety Executive under the Department for Work and Pensions. The Government are taking a tailored approach to ensure that regulation works for sectors and consumers covered by different regulations, including those outside the scope of the draft instrument. We have listened to feedback from the industry, and this draft instrument is designed to remove costs and burdens for businesses and to provide certainty on our approach to product regulation.

[Nigel Mills (Amber Valley) (Con)]

Will the Minister expand a bit further? Is he in discussion with any other regulatory regimes around the world that we think might have a sufficiently robust regime? We could just recognise those regimes for certain product lines and so reduce costs, not just for EU manufacturers. Are any such discussions about that being reciprocal, so that they recognise our quality standards as well?

[Kevin Hollinrake]

That is an interesting point. We are always keen to look at best practice internationally. Conversations are going on with other international regimes, including the USA, in particular in other areas not covered by this draft statutory instrument—for example, in the medical products sector. Although we are keen to strike mutual recognition agreements with different jurisdictions, I think it is fair to say that the EU is less keen to strike one. We should bear in mind some of the history and the proximity of the UK to EU markets. That is something that we are definitely keen to engage with, in particular under the auspices of our trade and co-operation agreement, which is the overriding mechanism for easing those barriers at the borders.

We estimate the draft instrument will save UK businesses £558 million over the next 10 years. It will also help ensure that goods in scope can be sold throughout the UK without needing different product markings and the associated conformity assessments required for each. We recognise that the instrument may reduce demand for the UK’s conformity assessment market. My officials continue to work with the UK Accreditation Service—UKAS—and industry to monitor the capacity of the conformity assessment body market, ensuring there is sufficient capacity to support a domestic route to market for relevant UKCA products.

Technology and manufacturing will continue to evolve. Therefore, in future the UK or the EU might need to make changes to product regulations. The Government remain able to mandate different rules in Great Britain, where we have relevant powers and it is in the interests of UK businesses and consumers. The product safety review is looking at the regulatory framework as a whole to ensure it is fit for the digital age and takes advantage of the UK’s regulatory autonomy to deliver a regime suited to the needs of UK businesses and consumers. Officials will continue to monitor ongoing EU product regulation reviews and updates.

Where EU regulations change, we will consider whether to continue recognition of EU rules on a case-by-case basis, taking into account the views of industry and consumer safety. The Government will introduce legislation later this year for additional measures to support businesses, including introducing permanent labelling flexibility and voluntary digital labelling as an alternative means of product labelling. I will share information with the House in due course. In the meantime, I trust Members will support this important instrument.

Budget Resolutions

Nigel Mills Excerpts

Wednesday 6th March 2024 Commons Chamber

[Nigel Mills (Amber Valley) (Con)]

It is a pleasure to follow the hon. Member for Batley and Spen (Kim Leadbeater).

The test that I was going to give the Budget before I heard it was: “How does this help my constituents, particularly those who are still struggling the most with the cost of living crisis?” In fact, I think that was the priority for the Chancellor. We have seen inflation start to come back down to where we want it to be, interest rates have come back down from their peak, and the economy is probably performing slightly better than we had feared—although not as well as we might have hoped—so I was certainly hoping that he would not take any risks that might destabilise that position and would focus on what he could do for those who most need support. That is pretty much roughly what we saw: a steady-as-she-goes Budget that focused on those issues.

I certainly welcome measures such as the time extension for paying back universal credit advances and the extension of the household support fund, which are good ways of targeting funds at those who will need them most over the next six months. Clearly, the single biggest decision was the extra 2p off national insurance. That decision will help people to keep more of what they earn, make work pay and improve household finances, so I strongly welcome it. Like many, I would have preferred a change to income tax such as raising the personal tax allowance, which would have helped those earning the least quicker than a percentage change, but this is not a time to be picky. It is an expensive measure, but it is a welcome one that will really help people, and we should not ask for perfection.

In many a Budget speech, I have asked: “Can we have a sense of direction for what we are trying to do?” I welcome the increase of the VAT threshold to £90,000 after a long pause, but it would be helped if we pegged it to something. Are we trying to give a self-employed person a median income after incurred costs but without their being in the VAT regime? Is that what we are trying to do? Is that where we should try to peg the threshold? Otherwise, we are just plucking random numbers out of the air occasionally. It would be better to have the right starting position and to index it every year to give some predictability.

Having asked for that sense of direction, we actually have one on national insurance. It appears to be the Chancellor’s view that double-taxing income through two different taxes is the wrong thing to do, and he seems to want to phase out national insurance when we can afford it. That is a welcome sense of direction, but if he really thinks double-taxing is the wrong thing to do, he could stop it more quickly by abolishing national insurance, putting more on income tax and just having one tax. The revenue we would get from taxing more passive income at a slightly higher rate would probably pay for a lower rate on earnings, so we would not have to make it literally 28%—we could probably get away with a slightly lower rate in that situation. If we are being radical and that is the direction we want to go in, the Chancellor could perhaps look at dusting off the old exercises on whether we really need those two taxes to be separate.

If we really believe that it is wrong to tax work higher than other forms of income, it seems slightly incongruous on the same day to reduce the capital gains tax rate on the sale of second properties. That shows how hard it is to have simplistic views, because we finally have a dynamic assessment that shows that if we lower the rate, we get more activity and more revenue. It would seem rather perverse to reject that and want to have a principle that gives us less money, so I think I welcome that change, even though it looks slightly inconsistent on the face of it.

I will use my last couple of minutes to welcome a couple of other small things. The fuel duty freeze is hugely welcomed by my constituents, who rely on their cars quite significantly. I also welcome the alcohol freezes, which are largely welcome in trying to help the hospitality trade.

I have called for the abolition of the non-dom tax regime in about the past three Budgets, so I welcome the fact that the Chancellor has done so. I was expecting a little fudge this time—perhaps he would reduce the number of years that a person could claim it from 15 to 10, or increase the amount they have to pay to access that regime—but announcing a complete reform of how we tax temporary residents and non-residents is absolutely the right thing to do. Our regime is completely out of date. Resident, non-resident, ordinarily resident, settled, habitually resident, domiciled, non-domiciled—I do not think anybody understands what on earth all those things mean. Having one modern regime, where everybody who is a long-standing resident pays the same taxes, is absolutely right.

It is fair to say that if somebody comes here temporarily to run a business or start one, or on an exchange with an employer, we do not really want the hassle of working out their whole worldwide situation, because by the time we work it out, they will have left anyway. Having a short-term exemption and then a much clearer, more modern regime that provides certainty and fairness is the right way to go, and much more defendable than the historic regime, which depends on where a person’s father was born. How on earth could we defend that in the modern day? I welcome the fact that the Chancellor has grasped that nettle in a proper, coherent way, and I look forward to seeing the final detail of those changes when the consultation takes place.

In a similar vein, I welcome the reforms to the child benefit charge. I thought that when the Chancellor said that two people earning £50,000 would be exempt, he was hinting that he thought £100,000 was the right place to set the household income level, but he did not actually say that. I look forward to the consultation establishing where we think the long-term correct position is; I think £100,000 would be a fair place to put it.

Overall, I welcome a Budget that is probably about the best that could be done, given that our deficit in the next financial year is £87 billion. For those who think we could be spending more or taxing less, I ask them how big a deficit we can really be running, and for those who think that relying on five-year forecasts is a bit risky, I would say that I sense that relying on the one-year forecast would get us a very different Budget. I think the Chancellor has found the right balance and that we are going in the right direction, and I look forward to supporting the Budget resolutions next week.