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Country of Origin Marking (Manufactured Goods)

Volume 559: debated on Wednesday 27 February 2013

Motion made, and Question proposed, That this House do now adjourn.—(Greg Hands.)

You can rest easy now, Mr Deputy Speaker. After all that gobbledegook about Basel III and socially dubious uses of money, we can return to the subject of the real economy. It is a great privilege to have secured this important Adjournment debate.

The issue of countries of origin and the right of consumers to know where goods, foods and materials emanate from is particularly important at present, as we battle with the ongoing horsemeat crisis. Indeed, that scandal is a textbook example of the need for clarity of information on sourcing, but what my colleagues and I wish to address this evening is origin marking in the ceramics industry, and especially the issue of what we call bogus back-stamping—the misleading allocation of country of origin details, designed to confuse the consumer.

It is said that we can always recognise a Stokie by their feverish examination of the back-stamp on any cup, saucer, plate or bowl. I am talking about the celebrated “turnover club”, as the plate is whisked over to examine the mark of origin—although I must add that there are some etiquette issues as to when we can do that when eating out.

I am glad to say that we have some excellent Stoke ware here in the Palace of Westminster. We have Wedgwood plates, some fine Dudson cups—from the constituency of my hon. Friend the Member for Stoke-on-Trent North (Joan Walley)—and if you were to join me for a cup of tea in my office, Mr Deputy Speaker, you would find some beautiful Emma Bridgewater mugs and Portmeirion cups and saucers.

It is a source of great pride to our constituents that pottery has been thrown in Stoke-on-Trent since the late-1500s. Out of the blue and yellow North Staffs clay came butter pots and flowerpots. In the sun kilns of Bagnall and Penkhull, local artisans started to glaze their earthenware and develop a reputation for craftsmanship. In their wake came the great houses of Wedgwood, Spode, Royal Doulton and Minton, names celebrated around the world for the excellence of their craftsmanship. Stoke-on-Trent gained the title “The Potteries” as “Made in Staffordshire” became a global hallmark of excellence.

When J. B. Priestley visited Stoke-on-Trent in the mid-1930s, he was taken aback by the beauty of the bottle kilns. He wrote:

“They represent the very heart and soul of the district…unless you are prepared to take a deep and lasting interest in what happens inside those ovens, it would be better for you to take the first train anywhere.”

Today, we make a lot of other stuff in Stoke, but the good news is that, after decades of decline, the pottery industry is roaring back to life: investment is up; orders are coming in; the kilns are alight; jobs are coming back from the far east; and we are all looking forward—as is the entire nation—to a successful royal birth this summer, with attendant ceramic sales. The key to success is the quality of our artists and designers, the new plant and equipment, and the artisan skills of the work force, which means it is more important than ever that consumers are able clearly to know what they are buying.

This is the problem we face: if a mug is made in Indonesia or Thailand, it can be transported into the UK and then have the word “England” stamped on the bottom of it. Similarly, if a mug is made in Vietnam or Turkey and then finished in England, it can have “Made in England” or “Made in Britain” stamped on the bottom. That is what we call bogus back-stamping—the wrongful attribution of country of origin labelling—and it is harming jobs and investment in the UK, and especially in Stoke-on-Trent. More than that, morally, it is trading off the skills, sweat and application of generations of Stoke-on-Trent workers, who turned the “Made in Staffordshire” brand into a world-class mark of excellence.

I have no problem with goods being made abroad and finished in the UK. This is not about protectionism. In a globalised marketplace, the supply chain will often cover many different continents. Many hundreds of jobs in the ceramics industry involve production abroad and finishing in the UK, and the companies concerned are often good firms that do the right thing. However, what I and my colleagues do have a problem with is goods that are made abroad being classed as being made in Staffordshire or Stoke-on-Trent, when they are not.

The rules are very clear. As you know, Mr Deputy Speaker, European Union directive 2025/73 states that it is the so-called ”blank”—where the first firing of the ceramics takes place—that determines the origin of the ware, irrespective of subsequent processes, such as finishing, decorating or glazing. It is about the first firing, and if that takes place in Jakarta, the product is Indonesian-made and should not have “England” stamped on the bottom.

For years, UK Governments of both parties—of all parties now—have opposed the compulsory indication of the country of origin of goods. Lord Mandelson attempted to introduce such a scheme in 2005 when he was the European Union Trade Commissioner, whereby there would be mandatory country of origin marking on certain products imported from third countries.

It is a big surprise. I spoke to the hon. Gentleman before the debate and asked for his permission to intervene, and I thank him for allowing me to do so.

Order. This is an intervention so you do not need to worry about that. I was more bothered about the fact that you came into the Chamber after the hon. Member for Stoke-on-Trent Central (Tristram Hunt) had started.

I appreciate that, and you are very gracious, Mr Deputy Speaker. The hon. Gentleman has spoken eloquently about the issue in Staffordshire and England. This is a devolved matter for Northern Ireland, Scotland and Wales, but does he feel that we need a UK-wide policy and strategy, and legislative change that would include the whole United Kingdom—Great Britain and Northern Ireland—so we could fight this issue together for all these reasons?

I am grateful for the hon. Gentleman’s intervention. This issue, be it, famously, about Scottish knitwear made in Morocco or goods unique to Northern Ireland which are made somewhere else and then passed off—

Giant’s causeway is an excellent example, although it would be hard to make another Giant’s causeway in other parts of the world. As I will set out, this is an issue where we want central Government direction but then for things to be implemented locally. We want the push from the centre but for the approach to be rolled out to the devolved Administrations, and I agree with what the hon. Gentleman said in his intervention.

The attempt to introduce mandatory country of origin marking has not worked. After seven years of trying, it was dropped in the European Commission and I fear we will not have it back again. So I am not making a case this evening for reviving mandatory country of origin marking. Instead, I wish to make the case for focusing on those companies that are misleading consumers on country of origin claims.

It is so important, particularly for the work force in Stoke-on-Trent, that we get some response from the Minister tonight. Does my hon. Friend agree that the real issue is that when people buy ceramics they want to be in a position to make an informed choice? Therefore, labelling is really important, as are the Consumer Protection from Unfair Trading Regulations 2008. If we are not going to go down the route of further legislation, we need proper enforcement, particularly by trading standards officers. We have seen a lack of trading standards officers because of the cuts to local government, so will the Minister therefore assure the House that the Department for Business, Innovation and Skills will give a real lead on requiring trading standards officers to take action on this issue of bogus back-stamping?

My hon. Friend has been fighting for the ceramics industry for far longer than I have, and her achievements with Steelite, Middleport and Royal Stafford are known throughout Stoke-on-Trent. She rightly makes the case that this is about consumer rights; it is about consumers knowing that when they buy wares that are “made in Stoke-on-Trent” and “made in Staffordshire”—the finest in the world— those goods have an authenticity about where they are made.

In the last debate the House had on this issue, the hon. Member for South Staffordshire (Gavin Williamson), who is not in his place but who has a history of working in the ceramics industry, asked what country a plate made by his fictitious company “Gavin Williamson English Chinaware” might be made in. What he illustrated was just how ambiguous the current framework is when the history and tradition of English or British manufacturing is integral to the branding of certain products, whether they are actually manufactured here or not.

The potters are proud of their history and consumers want to be sure that they are purchasing the true heirs to 300 years of craftsmanship. Of course, back stamping is not a legal requirement and the absence of a back stamp usually tells us as much about an item’s origins as a stamp does. However, if a back stamp or any product labelling is applied, the Trade Descriptions Act 1968 requires these marks to be accurate indications of the

“place of manufacture, production, processing or reconditioning”

of the goods. That is where bogus back stamping comes in, undermining the “Made in Stoke-on-Trent” brand and misleading consumers. The onus lies with the trading standards authorities to weed out that practice.

Too often, Business Ministers have listened to the big retail chains and superstores as they demand cheap goods at any price and claim that any attempt to inform the consumer is protectionism. Well, it is not. It is about transparency and rebalancing the British economy; it is about honesty for the consumer, and a decent industrial strategy for the UK.

My initial ask of the Minister is for the Department for Business, Innovation and Skills to allocate some funding to secure protection for this nationally important sector, as it has for other sectors under the Trading Standards Institute—most notably and recently the money-lending industry. Secondly, I ask her to write to the Office of Fair Trading to ask it to take a close look at the issue and report to Parliament on how it is seeking to protect the branding and property rights of UK ceramics companies. I also ask her to lead by example. There are mugs in BIS with no back stamp, there are plates in British embassies that are made in Thailand, and I have found in august institutions such as the Royal Society and the Imperial War museum ceramics bedecked in the imagery of Britain but imported from abroad. If Business Ministers are serious about supporting the march of the makers, they could begin with Government procurement policy.

My hon. Friends and I are seeking from this debate a commitment from the Government to take bogus back stamping seriously; to allocate time and attention to the question; to explain to the OFT and trading standards authorities that this is a priority issue and that they have the resources to deal with it; and to support our great ceramics industry through a detailed procurement process. If the Minister does all that, my hon. Friends and I might just think about welcoming her into the “turnover club”.

I am delighted to respond to the hon. Member for Stoke-on-Trent Central (Tristram Hunt) and I congratulate him not only on securing a debate on an issue that is very important for his constituency but on the passionate and humorous way in which he managed to convey the issues with a great degree of eloquence. He spoke from the heart about the importance of this fine industry and the role it can play in our nation’s heritage and our nation’s future.

It is not surprising, given that the hon. Gentleman represents the potteries area, that the ceramics industry was uppermost in his speech. Of course, it is a UK sector with a well-deserved worldwide reputation for the design and quality of its products. I can attest to that, as I was delighted to receive some when I got married two years ago. Such china makes a very fine wedding present, I must say.

Like the hon. Gentleman, the coalition Government are rightly proud of British manufacturing. I am delighted to hear the success stories of the potteries industry and, in particular, the recent improvements that mean that things are going very much in the right direction. We are clear that we want to secure and drive through growth, proclaiming what is made in Britain, invented in Britain and designed in Britain. The Department has championed that through the “Britain is Great” campaign and it is important that we champion the merits of our industries, which create so much fine produce in manufacturing.

I know that the hon. Gentleman and the other MPs from the Stoke area have recently had separate meetings with my right hon. Friend the Secretary of State and the Minister for Trade and Investment in the other place, Lord Green, to raise the issue of misleading origin marking. I hope those meetings reassured the hon. Gentleman to some degree that the Government take information for consumers seriously. Both the Secretary of State and Lord Green will write to him soon on this and other issues that he raised with them.

I agree that there is a place for country of origin labelling—that is, for positive country of origin marking, done because UK manufacturers think that is the right thing to do for themselves and for their customers. I would argue that legislation is not needed beyond the existing protections against counterfeiting and false advertisement, but that it can be done voluntarily. Of course many UK producers already do so because the companies rightly perceive a marketing benefit in being able to show that stamp of quality—hence the “turnover club”. The Government have consistently supported the use of voluntary country of origin marking, but we are cautious about adopting a legislative approach to origin labelling of manufactured goods.

The House will be aware of the Government’s concern that poorly designed regulation can be unnecessarily burdensome and complex, and duplicate requirements in other regulations, which can impose excessive and unnecessary costs on business. Introducing the debate, the hon. Gentleman stood up for businesses, so I am sure that he does not want them to face unnecessary costs either. We are trying to eliminate avoidable burdens of regulation and bureaucracy, so we will consider introducing new regulation only as the last resort. Overall, our aim is to reduce the amount of regulation, and that includes a commitment to improving and reducing the burdens imposed by European legislation.

That means we have to explore thoroughly alternatives to legislation, and in this case, I would argue that the alternative is voluntary labelling. The hon. Member for Stoke-on-Trent North (Joan Walley) asked whether, if the legislative route is not to be adopted, voluntary labelling can be properly enforced. She is right to highlight the key importance of enforcement. It is important to make it clear that because of rulings by the European Court of Justice and our single market obligations, the UK cannot unilaterally impose compulsory “Made in Britain” labelling, even if we wanted to; nor can we impose origin marking unilaterally on imports, because that would be contrary to our single market obligations.

Business can of course label if it wants, but that does not mean that such labelling is unregulated. Labelling has to be clear, accurate and not misleading to the consumer. The hon. Member for Stoke-on-Trent Central said he had a problem with claims that goods are made in Staffordshire or Stoke-on-Trent when they are not, and I wholeheartedly agree with him. Under current consumer protection regulations, it is a criminal offence to present false information and deliberately mislead consumers. The key test is whether the information encourages consumers to make a purchasing choice that they would otherwise not have made, and it includes misleading or false information on the origin of goods, however it is provided. That law exists.

The hon. Gentleman mentioned European Union directive 2025/73 and talked about origin being defined by where the initial firing takes place. That directive deals with the tariff treatment of ceramics and is therefore not strictly relevant to the Court’s judgment on consumer issues, where the key test is whether the consumer’s behaviour is affected. If it were deemed not to affect the consumer’s purchasing decisions, the information being wrong would not be deemed to be misleading.

Let us imagine someone going to buy a wedding present of china: does the Minister not accept that if the impression is given that the china was made in this country and it has all the attributes of pottery made in Stoke-on-Trent, but in fact the blank was manufactured abroad, it cannot be accurately described as manufactured in this country? That is the misleading aspect. It is similar to the situation my hon. Friend the Member for Stoke-on-Trent Central (Tristram Hunt) described involving beefburgers and horsemeat. In the remaining time, will the Minister stress how we can deal with disingenuous attempts to relabel an item as something other than what it actually is?

I will certainly endeavour to do so, because ensuring that existing provisions in law can be used is key to the question that the hon. Lady raises. The issue has not yet been tested in the courts in relation to origin markings. It is a broad concept, but the basic rule is that if consumers are likely to be misled in their purchasing decision, an offence is likely to have been committed.

Without commenting on specific examples, let me say that it is up to the enforcement authorities to consider whether there is any evidence of possible offences, and then it is for the courts to decide. The protection is not just for consumers—as in the example of gift buying outlined by the hon. Lady—but serves to ensure a level playing field for businesses that are honest and that give accurate information, so that they are not disadvantaged in relation to businesses that engage in deceptive practices. Local authority trading standards officers and the Office of Fair Trading are the relevant enforcement authorities in such a circumstance. The OFT’s role usually relates to matters affecting the general interests of consumers, rather than specific complaints, which are dealt with by trading standards officers. I encourage Members to ensure that any evidence of possible offences is brought to the attention of the relevant local authority, as has been alluded to.

Trading standards officers are, of course, answerable to their local authority and to local councillors. It is not the Government’s role to set local priorities for local enforcement activities, as they rightly depend on the issues arising in each area, and inevitably they will vary from authority to authority. In setting their priorities, however, local authorities must take into account the potential impact of particular behaviour not just on local consumers but on the wider well-being of the community, including the business community. Where local authority powers can be used to address matters that are having an adverse impact on a local economy with a particular concentration of businesses, it is reasonable for those matters to achieve the priority that they merit in that area.

The Minister is making an informative speech. Does a case need to come to trading standards officers to encourage them to act, or can Members of Parliament, for example, make a generalised request to them to look into a specific sectoral complaint?

Clearly, trading standards can look where there is evidence, or where they perceive that there might be evidence of a breach. I am sure that specific cases would greatly assist them in making their inquiries more fruitful more quickly. I encourage hon. Members to speak to their local trading standards teams. I know that the council in Stoke-on-Trent is run by the hon. Gentleman’s Labour colleagues, who, I am sure, will be willing to listen attentively to his representations on the matter. I urge him to take up the matter with them, as they have powers to deal with misleading information that encourages consumers to make a different decision on product purchases. Although part of the problem is that that has not been tested, I wholeheartedly encourage the taking forward of such matters. Given the various ways that Members have of raising matters in the House, I am sure that the hon. Gentleman will not let the matter rest if he does not get satisfaction through that route.

On the issue of the misleading of consumers, it is important to understand what matters to the consumer. In a Eurobarometer survey in autumn 2010, 75% of people questioned said that origin did not affect their purchasing of textiles and clothing; for electronic products, the figure was 68%. I am not sure whether ceramics were included in that study. We need to be clear about how consumers prioritise different pieces of information in their buying behaviour: price, design, brand name and origin. In making any purchasing decision, consumers will consider a variety of such factors. Of course, it is true that some consumers are very concerned to ensure that they support British or locally made products and will want information on their origin.

I will turn briefly to the European Commission’s 2005 proposal for a regulation on compulsory labelling of imported consumer products. The Commission intends to withdraw the proposal, as I am sure the hon. Gentleman will be aware. I know that the UK’s ceramics sector has been a consistent supporter, but the Government have strong reservations, as was outlined in the Adjournment debate secured by my hon. Friend the Member for South Staffordshire (Gavin Williamson) in 2011, which other hon. Members have referred to and, indeed, participated in.

The reason the Commission gave for withdrawing the proposal was the lack of agreement in the Council and developments in the interpretation of World Trade Organisation rules that make it outdated. We expect confirmation on that in April. The proposal received a mixed response from member states. Many saw it primarily as a protectionist measure that discriminated between imported and EU-produced goods. Consumer information is important, but we do not necessarily want to go down a protectionist route.

The Government obviously share the concerns about the need to tackle counterfeit goods and provide accurate information and the genuine concerns about trademark and design breaches and the mislabelling of imported goods from some sources, as the hon. Member for Stoke-on-Trent Central has outlined, but it did not seem that the Commission’s proposal would add anything to the debate except additional administrative and cost burdens, so it is right that it is likely to be withdrawn. There was also a customs issue relating to the cost that would be imposed, particularly in the context of the public expenditure constraints we face. If that is not the best way to achieve the outcome the hon. Gentleman wants, which is to allow companies in his constituency a level playing field and enable consumers to be well informed, alternatives such as the ones I have talked about and better enforcement are a better way forward.

I will turn to the specific questions the hon. Gentleman asked towards the end of his remarks. He asked what funding the Department for Business, Innovation and Skills might be able to bring forward. The Department does not fund individual enforcement actions, but it does fund the National Trading Standards Board. As he might be aware, the trading standards landscape has been changing, because there were concerns that trading standards were too dispersed. The board will have greater power. We can bring the issue to the attention of the Office of Fair Trading, but it is up to it to consider whether an investigation is merited.

With regard to the “turnover club” and the mugs in the Department with no back-stamp, I must say that I brought my own mug to the Department when I arrived. It commemorated the suffragettes and I enjoy drinking my tea from it. I have never turned it upside down to see what stamp is on it, but I will do so, although not when it is full of tea—as the hon. Gentleman rightly said, it is not always an appropriate moment to do that. I was intrigued to hear about the “turnover club” and will endeavour to take up his challenge to see where the goods in the Department come from and pass on his concerns to others.

House adjourned without Question put (Standing Order No. 9(7)).