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Trade Bill - Committee (3rd Day) (continued)

Part of the debate – in the House of Lords at 9:00 pm on 30th January 2019.

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Photo of Lord Fox Lord Fox Liberal Democrat Lords Spokesperson (Business, Energy and Industrial Strategy) 9:00 pm, 30th January 2019

My Lords, I am grateful to the noble Lord, Lord McNicol of West Kilbride, for introducing this group. As he pointed out, there are 17 amendments that cover objectives for future free trade agreements. The noble Lord, Lord Hannay, is not in his place right now, and I would never disagree with him. He identified a different group of amendments as being the most important part of what we are debating, but, for many people and for the impact that this is going to have out there in the country, this group of amendments is the plumbing. They cover the day-to-day operations of life, so I consider this to be a most important group of amendments.

I am not going to speak to all 17 amendments, but I am going to speak to four of them, which means that, unfortunately, I will break my own rule of brevity, but I will try to be efficient in what I say. I am going to speak to Amendments 39, 43 and 44, to which my name is attached, as well as Amendment 69, to which my noble friend Lady Jolly added her name but is unable to attend.

Amendment 39 requires the UK to negotiate with the EU an international trade agreement that creates a system for the mutual recognition of professional qualifications, as the noble Lord, Lord McNicol, set out. It must be at least as exhaustive as our current system and allow people to work across borders, allow workers to demonstrate the necessary requirements where qualifications diverge, and provide for co-operation between regulators. The noble Lord, Lord McNicol, used the example of architects; looking at the other side of the coin, 20% of the architects in this country come from an EEA or Swiss background. That is just one profession—one activity. The Government have the stated aim of building 300,000 houses; they will not have enough architects if we are not successful with this activity.

Under the current mutual recognition arrangements, for doctors, nurses, vets, dentists, midwives, pharmacists and architects the recognition is automatic, providing that conditions on minimum training and professional experience are met. For others, there is a general system whereby regulators cannot ordinarily refuse applications to practise from other EEA or Swiss nationals in this country if they hold the qualifications required by their home state. Since 1997, the UK has recognised over 142,000 EU qualifications. This is a big job. Noble Lords should remind themselves that there will be a lot of work to do around this, including for lawyers, social workers and engineers. Over 27,000 decisions to recognise UK qualifications have been taken in the EU.

The political declaration states:

The Parties should also develop appropriate arrangements on those professional qualifications which are necessary to the pursuit of regulated professions, where in the Parties’ mutual interest”.

I suggest that replicating the system to be at least as good as the current one is in the interest of this party—the United Kingdom. On that basis, I hope that, as the noble Lord, Lord McNicol, said, we are pushing on an open door here. The four principles set out in this joint amendment are the same as the Government’s four priorities for a future mutual recognition regime. I hope that the Minister can confirm that that is the Government’s understanding; perhaps they can settle some nerves by putting this amendment in the Bill.

Clearly, a no-deal Brexit situation would make life much more difficult. A statutory instrument is running its way through the system; it has been published, but it is subject to the affirmative process and has yet to be debated in the House. I look forward to that; I say that because there are so many SIs, but I look forward to that process, because this is an important part of what we need to do.

The point made by the noble Lord, Lord McNicol, about UK workers working in the EU is equally as important and vital. Clearly, if we leave the European Union with no agreement, we cannot mandate what happens to all our professionals in the EU 27, EEA and Swiss territories. However, I urge the Government to explain what representations they will be making in the event of a no-deal Brexit to carry over the qualifications at the very least, and then, of course, to put in place a regime that works.

Amendment 43 requires the UK to seek to negotiate an international trade agreement with the EU that binds the UK to EU rules on open and fair competition. We have had some discussion around state aid in the debate on a previous amendment, so I will not repeat that. However, this also includes mergers and anti-trust behaviour. The political declaration states:

“The future relationship must ensure open and fair competition. Provisions to ensure this should cover state aid, competition, social and employment standards, environmental standards, climate change, and relevant tax matters, building on the level playing field arrangements provided for in the Withdrawal Agreement”— clearly, now we do not know what that agreement will be—

“and commensurate with the overall economic relationship”.

We have had this discussion in a different context, but a binding undertaking that there will be no regression on standards is important to a lot of people in this House, and other noble Lords who are not here today have made this point with strong arguments.

On Amendment 44 and REACH, the noble Lord, Lord Hain, spoke about regulatory divergence; if there is ever an opportunity for regulatory divergence, it will be around the complexity of something like chemicals legislation. I will not go into huge detail about UK REACH, but this House needs to understand the scale and the scope of this activity. I have experienced it from a business side, and the commitment of European businesses in sitting on literally hundreds of sub-committees, debating and working through the nature of chemicals, how they should be used, and the associated risks, laws and regulations is absolutely huge. I can see looks of consternation.

REACH, as I am sure Ministers know, establishes a common framework of rights and obligations throughout the supply chain around chemicals ranging from chemical manufacturers, importers, distributors, formulators and end-users. It touches all of our lives, every day, practically all of the time. Chemicals are produced and put in the supply chain by upstream manufacturers, and there is a very detailed process by which they are regulated.

EU REACH became law in 2007, and the registration for existing chemicals was completed 11 years later. Every day, there are changes to the REACH legislation, and herein hangs the problem. The United Kingdom has stated in the withdrawal agreement, I believe, that we wish to remain in regulatory step with the European Union around REACH. But how do the Government, in the event that the United Kingdom is no longer part of the European Union, whether through agreement or through falling out without an agreement, envisage this process? Will we simply step back and take every rule that is coming from the EU 27 as the REACH legislation evolves? We will be unlikely to be invited in as equal partners to the REACH process by the European Union. The European Chemicals Agency, which is coming up in Amendment 70—my noble friend Lord Foster will be speaking to that amendment—clearly has a role to play. The United Kingdom’s role within that agency will also be important.

There is an SI which will be inevitable in the event of a no-deal Brexit. This SI is flawed, and I have asked to see the Minister to discuss this particular issue directly. I obviously will not talk about it today.

Suffice to say, this seems like a niche subject—something that only wonks like me should care about—but I have to tell your Lordships that UK companies with a REACH registration will no longer be able to sell into the EEA unless the Government have sorted this out. Downstream users currently importing from the EEA will face new registrations in the UK—whether immediately or over a period of months and days is still not clear. The UK Health and Safety Executive will grandfather existing REACH registrations, but it will then require re-registration or something within a time period within the UK. Formally, the Government have set out that the UK would like to remain part of REACH. How will that be possible?

Finally, turning to Amendment 69, those of us who had the pleasure of taking part in debates on the Nuclear Safeguards Bill will be aware of this particular issue, which is the European Observatory on the Supply of Medical Radioisotopes. I will not go into huge detail here, except to say that this is a vital organisation of which the United Kingdom must remain a member. Again, what will be the mechanics of this? In England, half a million medical scans are performed annually using imported radioisotopes. More than 10,000 patients across the UK have their cancers directly treated by these materials each year. Radioisotopes are also used to diagnose coronary heart disease and for biochemical analysis of blood, serum, urine, hormones and antigens. And of course they also have a scientific and a research use as well. Our research community is worried about this, as is the medical community.

We import 80% of our radioisotopes, in particular from specialist labs in the Netherlands, Belgium and France. There is also a supplier in South Africa, but not to the extent of our European suppliers. They are unstable. I shall not go into the chemistry—my degree has long expired—but these things do not last for ever. You do not buy them and keep them; they fall away. There are fewer than 10 supply reactors worldwide to provide 90% of the world’s supply.

The observatory’s role is to look across, manage and help the United Kingdom to manage its supply chain and ensure that we do not run short of those vital components to everyday help. Clearly, in the long term, we could build our own reactors, but that is not a short-term response.

The Government have stated their aim that we should have UK participation in the European Observatory on the Supply of Medical Isotopes. Amendment 69 states:

“It shall be the objective of an appropriate authority to take all necessary steps to implement an international trade agreement which enables the United Kingdom, after exit day”— which could be a very short time away—

“to fully participate in the European Observatory on the Supply of Medical Radioisotopes.”

How will that be achieved?