Exiting the European Union (Consumer Protection) Debate
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Thérèse Coffey
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Exiting the European Union (Consumer Protection)
Thérèse Coffey Excerpts(5 years, 9 months ago)
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The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Dr Thérèse Coffey)
I beg to move,
That the draft REACH etc. (Amendment etc.) (EU Exit) Regulations 2019, which were laid before this House on 5 February, be approved.
Madam Deputy Speaker, have you ever considered what life was like before you became a Member of Parliament? Well, I never had a dream come true until I was elected to Parliament, but if I take myself back to when I was at high school, I have to admit that my love of chemistry started when I was very young. I was very much inspired by colours, and it was only through chemicals that we had colours—whether it was the colour blue or a range of colours that appealed to us all. This got me excited in chemistry. Moving on a little bit further, I eventually ended up doing a PhD in chemistry. Little did I know that 30 years later, I would be here putting regulations in place.
Why do chemicals matter? Chemicals matter because they are not only part of our second-biggest manufacturing industry but critical to so many of the elements that we have around us, whether in the oil in people’s watches, in paint, or in the different chemicals that are applied not only in pharmaceuticals but in a wide variety of things that we just take for granted. They are even a key part of fireworks, because without chemicals—the inorganic chemicals, in particular—we would not get the wide range of colours. I do not know if you were here, Madam Deputy Speaker, on the night when we had chemicals in fireworks being exploded above Big Ben—that special evening when we were going to reach for the stars, but fortunately did not bring the House down.
Caroline Lucas
I was rather hoping that the Minister might do that, because something incredibly important is at stake here. At a recent meeting of the Environmental Audit Committee, we had before us the Chemicals Industry Association, which said:
“No deal would essentially mean, if I can put it lightly, catastrophic effects on the chemical industry here in the UK.”
Does she agree with that assessment, and will she do her very best, then, to rule out no deal?
Dr Coffey
No, I do not agree with that assessment. Nevertheless, this SI is not about whether we have a deal or not—it is about having an effective regulatory system. It is not about changing policy or trying to make it stronger—it is about trying to make sure that we can have something that works and continues to work in future.
In line with the European Union (Withdrawal) Act 2018, these regulations simply make technical and legal amendments, including transitional arrangements, to maintain the effectiveness and continuity of UK legislation that would otherwise be left significantly inoperable, so that the law as today will continue to function legally following our exit from the EU. I recognise that the statutory instrument is long and makes many adjustments, but I can assure the House that they represent no changes of policy.
Mary Creagh (Wakefield) (Lab)
The truth is that the statutory instrument will not be able simply to cut and paste the REACH database into UK law. We cannot cut and paste the chemicals framework established by the EU into UK law because it regulates, evaluates and authorises chemicals, and that is significantly different. That is why the Minister is asking this House to establish a UK chemicals database and asking the UK industry to make significant contributions towards that. That is the case, is it not?
Dr Coffey
That is right. These regulations will apply to the whole of the United Kingdom, with the exception of paragraph 1 of schedule 11, which makes amendments to existing domestic legislation regarding the disposal of polychlorinated biphenyls that, in the current regulations I referred to, extends only to England and Wales. This Government, and this country, have to be ready for the prospect of not being part of ECHA—the European Chemicals Agency—in future, and we therefore need to put in place the regulatory framework that means we will continue to have a safe chemicals industry in future.
Norman Lamb (North Norfolk) (LD)
The Minister will be aware, I am sure, of the concern that has been expressed by Rolls-Royce, and others, that the SI does not take account of all the scenarios. It mentions, in particular, an application for EU authorisation submitted by a European economic area entity for which a decision has not yet been made and on which a UK downstream user is dependent. Its concern is that post 29 March, in the event of a no-deal exit, UK companies could be left without a proper authorisation, putting many of them in an incredibly difficult position.
Dr Coffey
Actually, I am not aware of the reference to that by Rolls-Royce. Yes, we do need, in effect, to replicate the database, and that is what part of these regulations establishes. However, I want to make it clear to the House that CEFIC—the European Chemical Industry Council—and the Chemical Industries Association in the UK have made a joint statement to their members that the contracts that currently exist between consortiums should be amended so that information or data is available both for REACH and for UK REACH in future. None of the consortiums can force their members to do that, but I believe that it is in their best interests to make sure that the data and information required is available to both chemicals regulation systems.
As I said, the regulations apply to the whole of the United Kingdom. This Government and the devolved Administrations have worked together closely on these regulations and have agreed that a UK-wide REACH system will mean a coherent UK market backed by consistent policies and chemical management. The devolved Administrations have been involved in the drafting of the SI and have given their consent. That includes the Labour-run Welsh Government and the SNP-run Scottish Government. Indeed, this was also scrutinised by the Scottish Parliament, which also gave its consent.
Mary Creagh
A little earlier, the Minister talked about a section—forgive me, but I do not have the exact number—relating to the disposal of PCBs. Is she saying that different regulations will apply in Scotland and Northern Ireland, and, if so, will they be to higher or lower standards, or the same?
Dr Coffey
I am saying that, as it stands today, chemicals regulation is a devolved matter in how Governments can apply these things. We have a particular regulation that currently applies only to England and Wales. The Scottish and other Administrations will have made their own applications in legislation for that. That is why this is the only bit of the entire statutory instrument that does not apply to the whole of the United Kingdom.
John Redwood (Wokingham) (Con)
Will the Minister confirm that there will be absolutely no reduction in safety standards—because we all want high safety standards—and does she recall that when REACH first came in, quite a lot of industry voices said that it was more bureaucratic and more expensive but no safer?
Dr Coffey
The costs are still going to be significant for administering our own chemicals system in future, but I can assure my right hon. Friend that the safety standards will be consistent and, indeed, we will continue to learn from ECHA in future. As he will be aware, in the future economic relationship that has been put forward through the political declaration, and in ongoing statements by my right hon. Friend the Prime Minister, we would seek to become an associate member of ECHA in future to share these things in order to try to reduce or mitigate some of the challenges that people like Rolls-Royce are anticipating. But that is not yet an agreed matter, and it is important that the Government set before the House appropriate regulations to make sure that we have that continued safety of chemicals.
Before I explain the provisions further set out in the SI, I want to emphasise that we are absolutely keeping the fundamental approach of REACH, with its aims of ensuring a high level of protection of human health and the environment, as well as enhancing innovation and competitiveness. The building blocks of REACH will all remain: industry’s primary duty to understand the hazards and risks of chemicals and to ensure safe use, all tied to the principle of no data, no market; registration by industry of the chemicals it produces and places on the market; dossier evaluation by the regulator of at least 5% of registration dossiers to check compliance and quality, exactly as ECHA is expected to do today; and substance evaluation, which is investigation by the regulator of outstanding concerns about a chemical often leading to a requirement on industry to fill the knowledge gaps. The UK has been responsible, through ECHA, for making sure that there have been 24 evaluations—for example, of the chemical climbazole, which is used in anti-dandruff shampoos but is suspected of causing feminisation in fish. Then there is the authorisation process that forces industry to apply for and justify continued use of substances of very high concern. Finally, there is restriction of the most dangerous chemicals where unacceptable risks remain.
On the definition of duty holders, article 3 of schedule 1 of the statutory instrument changes the definitions of the various industry duty holders so that they refer to the United Kingdom rather than the European Union. Obviously, this is a simple change, but essential. Without it, UK industry would have no duty to ensure the safe use of the chemicals it produces and uses.
UK REACH will continue with an independent regulatory agency to carry out a central role with a range of technical, scientific and administrative functions—the role that is currently carried out by ECHA. The statutory instrument allocates this role to the Health and Safety Executive under article 2A of schedule 1. The HSE will receive industry’s registrations of chemicals. It will make many technical decisions itself—for example, in dossier and substance evaluations, as well as in scrutinising authorisation applications and making scientific recommendations on restrictions. This builds on the HSE’s existing activities as the UK competent authority for REACH. At the same time, the Environment Agency and the devolved environmental regulators will have the role of providing the advice that the HSE will need on environmental matters, as set out in article 2B of schedule 1.
The HSE, as the UK agency, must also draw on independent expert scientific advice when developing its opinions on restrictions and authorisations. This will add to the robust evidence and analysis underpinning its opinions. We expect the HSE to obtain external advice, but there may sometimes be reasons why it does not feel it needs to do so, such as where ECHA has already published a robust opinion on a chemical. In such cases, where the HSE decides not to take further scientific advice, it must publish its justification, as set out in article 77. Finally, appeals against the HSE’s decisions will be heard by an independent body, the first-tier tribunal, as set out in article 91.
Dr Matthew Offord (Hendon) (Con)
The Minister will be aware that I have some concern about the REACH regulations after we leave the European Union, but I am aware that we are talking about the statutory instrument and how it affects the United Kingdom leaving the European Union. She said in response to one of my written parliamentary questions that she wishes to have associate membership of REACH. Although I am not convinced that can actually happen, can she provide me with some kind of reassurance that the Environment Agency currently has the capability to ensure that compliance will continue after we leave the European Union?
Dr Coffey
I am conscious of my hon. Friend’s desire to have an ongoing relationship with ECHA. As I have already set out, that is the Government’s desire, too. The Environment Agency is recruiting an extra 10 staff, and the HSE will be taking on an extra 35 to 40 people to help fulfil the functions it already undertakes today. My understanding is that we have estimated the future cost of running UK REACH to be about £13 million a year. By way of comparison, ECHA itself costs about £80 million a year to look after 28 member states. That is why we believe that we are putting in the necessary resource to make sure that the HSE, the EA and, indeed, other regulators are able to play their part.
Alex Cunningham (Stockton North) (Lab)
I am not terribly sure that the Minister has reassured the hon. Member for Hendon (Dr Offord). I want to know how we will ensure that the British regime will actually parallel the regulations and approvals of Europe so that we can have the trading arrangements that are critical to areas like mine on Teesside.
Dr Coffey
As I said, we are recruiting staff to undertake additional elements, but it will be open to the regulator to take advice from where it likes, whether that is from ECHA, from within the UK—we should remember that, in many cases, UK scientists are the people giving advice to ECHA—or, indeed, from further afield. We will not be restricting the regulator’s consideration, but it matters that we have an operational scenario for chemicals regulation. The House can be assured that we will continue to have a safe chemicals industry in the future.
Mary Creagh
The Minister will be aware that my Committee, the Environmental Audit Committee, held an evidence session in December 2018, subsequent to our report published in 2017, in which we heard from Elizabeth Shepherd, a partner at Eversheds Sutherland. She is one of the UK’s leading experts in chemical regulation, and she said:
“The UK regulator, HSE, is no longer involved in the evaluation of substances. HSE has, to date, played a very active part in evaluating chemicals… the chemicals that were assigned to HSE for the 2018-19 period have been moved away from the UK already to other evaluating authorities. Businesses are concerned that they will lose the insight that participation gave them and the opportunity to influence the shape of regulation.”
We are losing our influence, are we not?
Dr Coffey
I do not think we are losing our influence. The measure was taken by ECHA after the people of the United Kingdom voted to leave the European Union. Currently, a country can only be a member of ECHA by being a member state of the European Union, so this is forward planning. Some of these assessments can take time to go through the ECHA process, and therefore, given that the HSE would not be a relevant authority for future ECHA authorisations, I would not want to criticise ECHA for having made that decision. Meanwhile, the HSE has the competence, and it has started recruiting people to undertake the different activities it will need to do.
I will now move on to decision making and working with the devolved Administrations. Just as the HSE inherits the role and functions of ECHA, the responsibilities of the European Commission will pass to the Secretary of State. For example, the Secretary of State will make decisions to authorise the use of a substance of very high concern or to restrict chemicals on the basis of an opinion from the HSE, as covered by articles 60 and 73.
REACH also covers devolved matters such as environmental protection. For that reason, the Secretary of State must act with the consent of the devolved Administrations where a decision relates to an area of devolved competence, as set out in proposed new article 4A in schedule 1. A safeguard clause allows the devolved Administrations, and indeed the Secretary of State, to take urgent action where it is needed to protect human health or the environment. This must then be followed up with the normal restriction process to see whether there should be a UK-wide control, as set out in article 129.
On transferring existing UK registrants into the UK REACH system, the regulations contain a range of transitional provisions to provide legal continuity to business and to protect supply chains. All registrations held by UK companies will be automatically transferred, often known as “grandfathered,” to the UK REACH system at the point of exit, as set out by proposed new article 127A in schedule 2, which means there will be no break in their access to the UK market.
Companies will need to provide the HSE with information to support their registrations in two phases: initial information within 120 days and the full information within two years. That is set out in proposed new article 127B in schedule 2.
Caroline Lucas
I have been reading worrying material. It is concerning that a civil servant recently confirmed that the IT system on which all of this will be based will not be fully functioning by exit day. Can the Minister confirm that it will? How do we know that the HSE has enough staff? There have recently been big cutbacks in HSE staffing. Are more staff being recruited for the HSE?
Dr Coffey
The Department for Environment, Food and Rural Affairs effectively contracts with the HSE to provide the necessary staff. The HSE covers a wide range of activities right across Government, particularly on safety at work.
The IT system is still being tested. I will be candid with the House that we will make a call this week on whether the system is ready to go live, or whether we will have to do our contingency plan of companies providing that information to us. I do not have an answer ready, because the assessment has not yet been made. In essence, the Government will still have the information they require to run a safe chemicals system. As I say, the decision will be made at the end of this week on whether companies or the Government will upload the information.
Dr Coffey
No, I do not need to give way on that point.
One way or another, the Government will have the information they need to ensure that we have a safe system.
As my right hon. Friend the Member for Wokingham (John Redwood) set out, REACH places a registration duty on importers of chemicals. This will be new for companies that import from the EU or the European economic area, as they are currently covered by their supplier’s registration. That is why we are giving them a two-year grace period, which will give them time to adapt and will protect supply chains. In the meantime, they must send information to the agency within 180 days to provide assurance that they know how to manage the chemicals safely—that is set out in proposed new article 127E in schedule 2. We will keep both two-year deadlines, for grandfathering and for downstream user registrations, under review.
Dr Offord
I am grateful to the Minister for taking interventions, which we are seeking to make because we have specific questions on which she can provide us with advice. Is it the Government’s intention, post-Brexit, to update regulations in compliance with REACH to ensure that the two systems work side by side?
Dr Coffey
In effect it will be for the HSE, as the regulator, to make decisions on each level of the process. I have no reason to doubt that the HSE and ECHA will have similar principles in how they go about this. We are not seeking a change in any policy to move away from the REACH process.
It is fair to say that the UK has been trying to get some chemicals restricted much more quickly than ECHA and other EU member states have sought, so there may be opportunities to move more quickly on some of these matters. Again, it will be a judgment call for the HSE on whether to make that recommendation to the Secretary of State.
As for stakeholders, we held a series of informal briefings last summer at which we outlined the proposed regulatory approach, and representatives from the chemicals sector and beyond and other stakeholders, including non-governmental organisations and scientific societies, came to those briefings. Since then, we published a technical notice in September and additional guidance in December and continued with more stakeholder engagement to explain in detail what UK REACH is and what it means for industry. The House will also be aware that I invited MPs, particularly those with chemicals companies in their constituency, to attend briefings.
I recognise the concerns about why businesses have to submit data to the HSE when they have previously registered with ECHA and the potential costs involved. Such concerns were also expressed in the report by the Secondary Legislation Scrutiny Committee in the other place. As the Government said in the White Paper, we want a strong deal under which the UK will continue to participate fully in EU REACH and the work of the ECHA. The impact assessment considered the question of data in detail, and the Regulatory Policy Committee stated that the assessment used a proportionate level of evidence to support estimates of the impacts, including impacts on business. We should not expect a repeat of the costs of complying with EU REACH. For example, businesses that have already invested in putting together the EU registration dossier will not face administration costs again.
To be clear about the importance of information. The “no data, no market” principle is fundamental to REACH, and we will not weaken that in any way. It underpins effective chemicals management by both industry and the regulator. We cannot rely on the fact that such data has already been sent to ECHA. It is simply not correct to say that a chemical is deemed to be safe once it has been registered under EU REACH. Registration is how a company shows its understanding of the hazards and how to control the risks, but it does not mean that ECHA and other regulators have approved that chemical or endorsed it as safe.
ECHA will not evaluate the UK dossiers that it received for the June 2018 deadline. ECHA has also stated that, in the majority of dossiers it opens for evaluation, it needs to follow up with requests for important safety information on chemicals, meaning that the company’s safety measures may also not be adequate. Only the UK agency will be able to provide the assurance that chemicals are safely managed in the UK. To give a sense of scale, we will be grandfathering over 12,000 registrations into UK REACH—35% of them from 2018—representing 5,700 chemicals. Looking forward, we would then expect 50 to 100 new chemicals to be registered each year. We have much less understanding of how many notifications there will be for chemicals imported from the EU, because there is currently no duty to report that information in most cases. That emphasises the importance of the notification process so that we know what chemicals are being used in the UK.
REACH is one of the largest and most complex pieces of EU legislation and Members and others have rightly wondered how we would transfer it into UK law. I am confident that the provisions in these regulations mean that we will continue to ensure the highest levels of protection for human health and the environment, based on robust evidence and strong scientific analysis.
John Redwood
Maybe I can help the Minister. Is it not the case that the Intrastat declarations provide the necessary information about the current trade in European chemicals?
Dr Coffey
I do not know the answer to that, but I will share the suggestion with my officials, some of whom are conveniently in the Box.
I want to assure right hon. and hon. Members that we are taking steps to provide the industry with the legal certainty it needs to operate and to preserve the supply chains for the chemicals on which we all depend.
Dr Coffey
I thank all right hon. and hon. Members who have contributed to this debate. I assure the House that the Government remain committed to supporting all the aims of REACH: to ensure a continuing high level of protection of human health and the environment; to promote alternative, non-animal methods for assessing chemical hazards; and to promote the free circulation of chemicals and enhance competitiveness and innovation.
By putting the regulations in place, we will make sure that we can operate a UK REACH regime after leaving the European Union. We are working closely with the HSE and the EA, as well as other regulators, to prepare for that national regime so that the change is as smooth as possible. We know the functions that are needed. I hope that in my opening remarks, I was able to convey the information that we will be providing the resources to fund the staff that are needed. I remind the House that the HSE will be building on the expertise that it already has from acting as the UK competent authority in the EU system and that it will be recruiting more staff to reflect its new and expanded role, as indeed, is the EA.
I do not agree that the arrangements that the REACH SI provides for on scientific advice are in any way weak. The UK agency must publish its scientific opinions, and when forming those opinions on authorisations and restrictions, the HSE must commission scientific knowledge and advice from suitably qualified or experienced persons who are independent of the agency. In a particular case, for example, where ECHA had already published robust evidence, the HSE must publish its justification for deciding not to take further advice. I assure the House that the HSE is not limited to getting its scientific advice from the UK, or indeed, even the EU.
The HSE must consult on and publish a statement about how it will comply with all these duties. That must happen within three months of exit, so we intend to have arrangements in place in UK REACH to allow stakeholders to observe discussions and considerations where this scientific advice is provided.
Dr Coffey
I will not be giving way in my closing remarks—[Interruption.] Well, I am trying to answer the questions that I have already been asked. On what industry needs to know to do, we have had extensive discussions with a number of businesses and trade associations. We have launched a business readiness campaign targeting downstream users, in particular, and we continue to engage with the industry in that regard.
A question was raised about intellectual property. It is fair to say that the intellectual property remains with the company that submits it, but if companies already own the data, they can of course submit that to UK REACH. If not, they will need to arrange access and, as I pointed out, some are already starting to do so. Some—I mentioned CEFIC and the CIA in the UK—have encouraged their members with consortium registrations to make sure that they make that information readily available. Companies can, of course, employ ORs—only representatives—to hold a registration in the EU, just as they may do for access to other markets around the world, while maintaining their UK registration.
Dr Coffey
I will not be giving way, as I have already made clear to the House. I am trying to answer the questions that I have already been provided with. On the other elements of registration, I am conscious that some companies have started to set up relationships with not only ORs, but other companies and to establish offices in the EU. Ireland is a particular favourite.
I want to clarify elements about animal testing—I know that this matters to the House. Within the EU—currently within ECHA—HSE and the EA have been at the forefront of pushing for alternatives to animal testing, and that will continue. UK REACH will continue to follow the “last resort” principle when it comes to possible animal testing. That works alongside other REACH drivers to reduce the amount of testing, for example, where industry must get the regulator’s agreement before carrying out a test. We will continue to work closely with the OECD to develop new alternatives so that we can understand chemical hazards without testing them on animals. We are determined that there should be no need for any additional animal testing for a chemical that has already been registered, unless it is subject to further evaluation that shows that the registration dossier is inadequate or that there are still concerns about the hazards and risks of the chemical.
The right hon. Member for North Norfolk (Norman Lamb) asked particularly about Rolls-Royce and products that have not yet been authorised. The point is that the EU has not authorised those chemicals for use. Therefore, we cannot say that they will be authorised by the time we leave on 29 March and we will not have the position to allow for future EU decisions. HSE will work with companies to help them to get into compliance as soon as possible.
The hon. Member for Wakefield (Mary Creagh) referred particularly to products that include chromium. I can categorically say that chromium is a clear carcinogen and it really matters that we have to keep strong controls on how it is used. That is why it concerns me that the Opposition are considering voting against this SI. I pointed out earlier that the Welsh Labour Government have endorsed this SI and want it to pass today. Without these regulations we would not have a chemical regulatory regime that was effective in maintaining human health, and the environment would be put at risk, which makes me even more astonished that the Green party would also contemplate that.
We need to make sure that our regulators have the tools to understand the hazards of the chemicals that we use, and without this SI we would not have the information available on how to mitigate those risks. I invite the House to approve the regulations.
Question put.