To ask Her Majesty’s Government what is their economic assessment of the impact of the introduction of a new system for the regulation of chemicals.
My Lords, leaving the EU provides a unique opportunity to set up our own system for chemicals that will deliver high standards and be flexible to the current and future needs of the UK. It will give us the freedom to do things differently, where that is in our best interest. There will be transition costs, but by keeping changes as straightforward as possible, we will minimise the burdens and costs for business.
I thank the Minister for his Answer and for speaking to me earlier today, but, as he is aware, the costs are unlikely to be minimal. If we take the statutory instrument currently laid as our model, the costs will be at least £1 billion simply to reregister chemicals that are currently legal under the EU system. This is a tax on British business, and even if it is spent over two years, it still constitutes a large number. Will the Minister undertake to work in close co-operation not just with his colleagues in BEIS but with the industry, which is extremely concerned throughout the sector, from manufacturing through basic chemicals industries down to cosmetics? Will they work with the industry to look at stretching the implementation period, cutting registration costs, finding ways to reuse data and all ways to make this a costless transition?
We absolutely recognise that the costs may be substantial. That is why we are aiming to keep the transition to UK REACH as simple and straightforward as possible. We are considering a wide range of measures to minimise the burden and costs for businesses and will continue to work with BEIS, which we of course already work closely with, and the wider industry sector to keep these measures under review. We have developed grace period provisions, grandfathering and downstream user import notifications to minimise disruption to businesses and supply chains at the end of the transition period, while ensuring that UK regulators know which chemicals can legitimately be placed on the market. These measures give businesses two years, starting from the end of 2020, to provide the information required to be compliant with UK REACH
My Lords, will my noble friend commit to the UK remaining a partner of the European Environment Agency? As he will be aware, a leading figure of the Johnson household —no less a figure than Stanley Johnson—was responsible for setting up this agency and is very wedded to remaining. It plays a leading role in terms of chemicals and all sorts of environmental protections. Will the Minister commit to our remaining a member of the EEA?
I have discussed the issue many times with the Johnson in question. We will take decisions based on science and on the best available evidence, including looking at approaches taken by other chemicals regimes right across the world, well beyond the European Union. We will not seek ongoing alignment with the EU regulatory system but we will not diverge simply for the sake of it. There may be good reasons for taking a different approach on a particular substance to reflect UK circumstances, but that does not mean reducing standards or levels of protection. For example, for many years the UK has been at the forefront in opposing animal tests where alternative approaches can be used—the last-resort principle. We could be more rigorous in applying this principle in the future and there are many other examples where we might want to diverge.
The Government’s decision to withdraw from REACH contradicts what the Minister has just said. Experience has shown that shared research enhances that research. Leaving the European research organisations will diminish our research work. Therefore, will the Minister reconsider that decision? Surely it would be another way of reducing the costs that he has just told us about.
The noble Lord is right that we will reduce the costs that have been mentioned if we can facilitate the sharing of data between the UK and the European Union, and that is something that we are pursuing. It is not something that I can describe in any great detail now because much of it depends on the ongoing negotiations. However, he is absolutely right, and it is certainly our intention that data sharing should be used wherever possible to bring down the costs for businesses both here and in the EU.
My Lords, does the Minister recognise that the outcome of the UK/EU trade negotiations will be vital for the chemicals industry and indeed for the economy as a whole? In view of that and the fact that both the UK and the EU will, rightly, be distracted from those negotiations by the current public health crisis, will the Government consider amending the withdrawal Act in the forthcoming emergency legislation so that they have the power to extend the deadline of
Were it the case that the British Government felt the need to do such a thing, they would take the step that the noble Lord has outlined, but that is not the view of the British Government today. There is no need for any additional delays.
I am very happy to give that undertaking. As my noble friend will know, we are on the cusp of developing a new chemicals strategy. We will be putting out a call for evidence this spring and will consult on a draft strategy before its eventual publication, which currently is proposed to be in 2021-22. It will cover the full range of the UK’s approach to tackling chemicals and pesticides as used in horticulture.
My Lords, can I take the Minister back to the answer he gave about REACH? My understanding of paragraphs 16 and 17 of the recent White Paper is that the Government want a dedicated annexe on chemicals regulation, but in his answer he said, “We don’t want to deregulate for the sake of it; we don’t want to have lower standards”. Therefore, how similar to REACH does he think the EU/UK memorandum of understanding will look?
That is a difficult question to answer. I cannot tell the noble Baroness exactly where we will choose to diverge. I gave one example earlier but there are plenty of others. Poland, for instance, has made a proposal to the EU about banning the use of methanol in windscreen-washing fluids. It has done so because it is affected by abuse of that substance by alcoholics. That might be very sensible for Poland to do but our view is that it is best addressed at the national level. Therefore, there will be areas where it is in our interests to diverge but there will be other areas where, in the interests of both efficiency and saving money, and in the interest of maintaining high standards, we will choose not to diverge. The core principle is that it will be our choice.
Again, I am afraid I am not able to give a precise figure—I do not think anyone is capable of doing so—but we have had these discussions with industry and, as I say, with BEIS. It is the case that industry estimates are not a million miles away from our own but we cannot put a precise figure on them at this stage.