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House of Lords Hansard
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European Research Infrastructure Consortium (Amendment) (EU Exit) Regulations 2018
28 November 2018
Volume 794

Motion to Approve

Moved by

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That the draft Regulations laid before the House on 29 October be approved.

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My Lords, in moving that these regulations be approved I shall add some context. A European Research Infrastructure Consortium is known as an ERIC. ERICs are set up to support major international science and research collaboration within the EU and provide a legal structure that enables countries and organisations to work together to tackle international research challenges. These projects often involve science and research in areas where the resources and expertise required are far beyond the capabilities of any single nation. Each ERIC has its own statutes setting out, among other things, the rights and obligations of the members and the functioning of the ERIC.

ERICs are funded primarily through ERIC member contributions, not the EU budget, and they often have expected lifetimes of decades. The UK presently hosts two ERICs: the European Social Survey, based at City, University of London, and Instruct, an ERIC looking at integrated structural biology, based at Oxford University. There are 19 ERICs in existence; the UK is a member of 12 of them and an observer of one. Based on our estimates, the UK has received around £30 million in funding from grants and membership fees and, by the end of 2017, had contributed around £64 million to ERICs. In addition, UK businesses can bid to supply parts and services to ERICs of which we are members.

BEIS Ministers make the final decision on whether the UK joins a particular ERIC, usually following an approach from a research interest and advice from UKRI. Funds are provided using Section 5 of the Science and Technology Act 1965. BEIS and UKRI officials usually participate in ERIC councils.

The outcomes of these projects feed into research communities across the UK, including marine science, astrophysics, human health and welfare, and societal change. ERICs stand as the kind of world-class facilities that we aim to ensure UK scientists can access to underpin the UK’s position as a leading scientific nation. For example, the integrated structural biology ERIC gives the UK access to specific flagship nano-bodies facilities in Belgium, which offer technology the UK would otherwise not have access to.

The draft statutory instrument before your Lordships is largely technical in nature, in that it makes purely technical arrangements for the existing legislation on ERICs. It addresses deficiencies in the retained EU ERIC regulation—the legal framework for the creation and operation of ERICs—that arise as a result of the United Kingdom’s exit from the European Union. It does not implement new policy. For example, the instrument removes provisions that relate to European Commission actions, such as the production of annual activity reports by the ERIC. The amended regulation will ensure that ERICs continue to have the same attributes, such as legal personality, as they had under the ERIC regulation as it applied before exit day.

The scope and technical nature of these regulations as I have outlined them may suggest that the negative procedure might have been more appropriate for this statutory instrument. Indeed, this was the conclusion of the Secondary Legislation Scrutiny Committee of your Lordships’ House. However, the European Statutory Instruments Committee in the other place noted the ongoing role of the Court of Justice of the European Union—the CJEU—in ERICs, and recommended the affirmative procedure. I would therefore like to explain briefly why this SI makes no amendment to that role post exit.

Membership of ERICs requires recognition that the Court of Justice of the EU has a limited role in ERICs. Specifically, if a dispute arises between ERIC members, or the ERIC itself and a member, in that case the court could be asked to determine whether an ERIC member is fulfilling its obligations under the ERIC statutes. This is different from the CJEU’s role in ruling on compliance by EU member states with the Treaty on European Union and the Treaty on the Functioning of the European Union. It is not an area where penalties could be imposed for non-compliance. Any remedy would be applied by the individual ERIC in line with its own rules—rules to which members of the consortium agree when they sign up. There would therefore be no impact on the United Kingdom’s sovereignty owing to our membership of ERICs. We remain free to leave ERICs at any time of our choosing, in line with the rules of each ERIC.

Participation in an ERIC is open to any country in the world. As such, there is no legal reason why the UK could not continue to participate in these projects following EU exit. The legislation before the House is technical in nature and ensures that our laws are fit for purpose if we leave the EU with no deal. The UK’s leadership in science and innovation is supported and strengthened by international collaboration. Projects such as ERICs help facilitate such collaboration; in turn, this helps to consolidate further our world-leading reputation in science, research and innovation. I commend these regulations to the House.

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My Lords, I thank the Minister for introducing this statutory instrument. I agree with her that ERICs have an important role to play in unusual but very important projects, such as the ones she has described. I feel we are witnessing something very sad. It is almost as if a whole edifice of structure and relationship is being knocked down by our withdrawal from the European Union and then, SI by SI, we are coming back with Lego bricks and trying to rebuild one piece, and then next piece. Of course I support the objective of this SI because it is putting back something that we should not be knocking down in the first place.

I admire the Minister’s gymnastics around the role of the ECJ. Of course, we on these Benches do not have to make the big exceptions and explanations that she is making for the benefit of her supporters. Of course the ECJ should continue to have the role that it has so, in all, what we see before us is a sensible and pragmatic piece of work, and we are glad that the Minister has brought it to the House today.

I had the benefit of a brief meeting yesterday, and I thank the Minister for that. One thing I asked in order to try to short-circuit some of these discussions was that the Minister would in her introduction or response give the House some idea of how a new ERIC would be established and what procedures would be gone through, given that we are now speaking from two jurisdictions rather than one. It is not clear to me from the background information or from yesterday’s conversation what that process is. Were I part of a consortium and to lead that consortium, how would I go about the necessary negotiations in order to deliver a new ERIC rather than simply sustaining the one we have? Who approves or oversees the statutes? As I see it, the ECJ covers the regulations and the board of the ERIC manages the statutes, but my question is about establishing the statutes. With that overriding question, I support the objectives of this SI.

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I much admire the Minister who introduced this statutory instrument, but I would not like her to go away with the idea that everybody is happy that we are playing around in this way with 40 years of building relationships with our neighbour. The truth is that the argument about the ECJ, although beautifully put and extremely elegant, really does not hold water. If you are going to have an agreement with your neighbour, it is not unreasonable to have an independent judgment should you fall out. The idea that this is different because it cannot impose any penalties itself but the organisation can as a result of its decisions seems to me to be a distinction without a difference. It arises only because my noble friend has to appease a lot of people who do not understand what a remarkable step forward the relationship between the United Kingdom and the rest of the European Union is and why that many of us will continue to fight for our membership whatever people say about ideas which we understand will leave Britain poorer off by the words of the Chancellor today.

One of the ways we will be left poorer off is that it will be more difficult to have these kinds of relationships. It is all right saying “we are a leader in the world”, but part of the reason why we are is because we are in the European Union, and if you remove us from the European Union it will be much more difficult to be a leader in the world. We merrily talk about this being necessary should we leave the European Union without a deal. If that were to happen, this is the last thing anybody would be thinking about. They would be asking how to get food in the supermarkets. They would be asking whether packaging would come to get the stuff to the supermarkets. They would be asking a whole lot of other questions, such as how can they get down the M20 or the M2. That is what they would be asking—this would be low down their list of priorities.

Of course we are not going to stop this affirmative resolution going through, but we are doing it in the heart of the most disgraceful activity Britain has done in peacetime for as long as anyone can remember. We are making ourselves poorer, less able to say something in the world, less able to have influence and less able to be a leader. We are doing so with our eyes open and asking people to support it. I have to say to my noble friend that I have come particularly to say that this does not have my support. I am not going to oppose her Motion, but it is a sad day that we have to have it at all.

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Follow that. I am happy to agree with the last two speakers, both of whom have brought a lot of sense to this debate, although I think “poorer off” is probably a combination of “worse off” and “poorer”. If the noble Lord, Lord Deben, is intending to repeat that speech during the longer debates that are coming over the horizon, as I hope he will, he might want to get the wording a bit more right because it would have more punch. It is very daring of me to advise a man of such distinction and history in Parliament, particularly in this House. I am a bit old for Lego so I did not quite catch the allusion made by the noble Lord, Lord Fox, but I think the point that he was making is right. We are scratching around here and missing the bigger picture, and both the previous speeches made that point.

I thank the Minister for her letter and for the pre-meeting that we had on this Motion, and I am grateful to her for changing slightly the explanation that she would otherwise have given in order to give a bit more detail. I still think we are a bit short of a couple of issues that I hope she will cover when she responds, and there are a couple of questions that I would like to leave her with at the end. Having said that, I am not going to oppose the Motion; it is a sensible piece of bookkeeping that I hope will never have to be used. The implication is that if there is no deal and we leave on 29 March then this will be implemented. Could she reflect on what happens if there is a deal but no transition period? What is the timing in that situation?

On the particularities, the information that I asked for in the pre-meeting about the process that would be applied if this SI were in place follows up on exactly what the noble Lord, Lord Fox, said. The power to pay money for this, as the Minister said, lies in the 1965 Act. I understand that but what is not clear is the role of UKRI consequent on the Higher Education and Research Act 2017, which is now in force and changes the nature of the relationship between the research councils and the overarching decisions that are being made. As I understand it, research councils still make their own budgets and agree them with the department, but UKRI has an advisory and oversight role and indeed has additional funding if it wishes to do things. Who has the authority to agree to any group in this country going forward to an ERIC? What precisely is the nature of the power that is being taken, who exercises it, and in what way is that different from the current situation? In other words, under the present arrangements, as we are a member of the EU and not a third country, presumably we have a system under which money that is required for creating a new ERIC or joining an ERIC is still in play, maybe still under the 1965 Act. Does that change as a result of this SI?

The subsidiary question, which I am sure the Minister will duck, is this: while there may be no change in terms of regulation, will there be any change in funding opportunities for people if and when we leave the EU and we still wish to participate in these ERICs? The Minister said how many there are; we are a member of a number of them and two are located here. Are there any plans—I have not seen them if there are—for developing this approach? As she said, it seems to bring benefits; it seems to double the money that we can invest in science, and it is good to maintain links with scientists and technologies in other areas because otherwise arrangements for common work would be more difficult.

I turn to the issues that were raised in the other place. The Minister mentioned the CJEU. Like both of the other speakers, I am not sure that I quite follow where we are on this. The CJEU has a role in asserting the overall regulatory framework under which the ERICs operate. However, from both her letter and what she said in introducing the SI, the only power that we would have in the way that is now described—we can debate why she has expressed it this way—is to resign. In other words, if for some reason the rules are going to be adjusted or changed in a way that would imply a necessary change in UK legislation, there is no way in which the CJEU must be allowed to influence British legislation so, if the research party concerned wishes to continue, I take it that its only solution is to resign. That does not seem a very fair or equitable way forward, and I wonder whether the Minister would comment.

That covers one of the points made by the committee in the other place. The other point that it raised was rather more philosophical. The Government’s assertion is that nothing is changing here because we are simply adjusting the rules that would have applied before leaving the EU to a situation to allow it to continue afterwards. The committee said:

“While it can be argued that the policy has not changed, future UK participation as a third country will inevitably mean that the policy functions in a different context”.

Will the Minister comment on whether that is true and, if so, whether there are any implications that we should be aware of?

The regulations before the House deal primarily with research, which is a reserved area. Any change in research funding or research activity has a significant implication for universities, which are of course a devolved matter. Did the Government therefore consult with the devolved Administrations prior to laying this instrument? If so, what was the result? I think there is a reference to letters having been issued but I do not think that involves consultation.

My final point is the regular question about immigration policy. ERICs will allow the UK to engage in science research projects, but the industry has previously mentioned the problem of how the UK’s immigration policies limit its ability to recruit the postgraduate scientists who will necessarily be employed in these areas. In March, 48 science organisations wrote to the Prime Minister claiming that the repeated rejection of skilled workers due to the capping of the tier 2 visas has damaged the UK’s international appeal and will continue to do so. What action have the Government taken since then to try to resolve this very difficult problem?

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My Lords, I thank noble Lords for their very valuable contributions to this debate. I will aim to answer as many questions as I can. There were some impassioned speeches and hard words around the broader picture but when we come back to look at the SI that we are actually considering, to coin a phrase, nothing has changed. This measure is technical in nature. We are not knocking down anything; indeed, we are doing our best to ensure that it stays in place because we very much value the relationships that we have with ERICs. They play a very important part within a much wider research and innovation framework.

On the point about the CJEU, the noble Lord, Lord Fox, reached the point that I had already written down as he was speaking: this measure is pragmatic. It is purely a pragmatic way to approach an issue whereby it may be between the member state, or indeed the ERIC participant, and the ERIC. Someone needs to be able to make a decision there. From the Government’s perspective, we are very content for the CJEU to make that decision because the EU is not a party to that particular procedure.

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On that point, let us take a practical example. An ERIC is set up and operating. For reasons best known to themselves, our researchers decide that its rules are not currently fair and it needs to change something affecting, let us say, an immigration regulation within the UK. Is the Minister saying that the Government would accept the CJEU’s decision to make that change? This is a fantasy world; I am not trying to say it is a real situation. However, this is the narrow point. The Minister is saying the CJEU will have the authority to change the rules and regulations of the ERIC because they do not affect the UK but, if the rules are changed so that we would have to change our own legislation in order to stay in the ERIC, that cannot be true.

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The rules and regulations are agreed by member states as they come together to form the ERIC, so obviously, those statutes are specific to that ERIC. I take the point made by the noble Lord, Lord Stevenson, concerning if, for some reason, the ERIC regulations fundamentally change. I do not think they have changed since 2008-09 and there is no move to change them whatsoever—let us remember that other non-EU countries would also be impacted by such a change to regulations—so I cannot imagine that there will be a great groundswell to change them. The CJEU is looking at the statutes of the ERIC—not the regulations themselves, the individual statutes of the regulations. Obviously, if a ruling went against us, we would have to consider our position, but we must be realistic: not a single case has ever been taken to the CJEU. We are probably dancing on the head of a pin. We have a mechanism—I do not want to call it a backstop—through which disputes, if there are any, are now resolved and will be in future. We are content to maintain that mechanism and I hope that the noble Lord is too.

I am pleased to say we may well be joining a number of ERICs in the next few years, and I hope that I outlined the process in my opening remarks. BEIS Ministers, using royal prerogative, have authorisation to join an ERIC, but before that happens there is an enormous collaboration process with UKRI, which advises whether it is a good idea for us to join. Securing the funding comes down to priorities, business cases and collaboration between the Department and the Treasury.

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Just to be clear, the Secretary of State would exercise the royal prerogative.

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Yes.

That is how, hopefully, we will be getting involved in new ERICs, which may happen soon. I take on board the comments of my noble friend Lord Deben, and I hope I have addressed them in the context of the CJEU and our pragmatic approach to this issue.

The noble Lord, Lord Stevenson, raised the issue of timing—when the legislation will be needed or commenced. Obviously, if we have a deal, we will never need it, and therefore we hope that it will be put to one side. However, there is a possibility that, a scenario in which, we end up with no deal after the implementation period. At that point, this piece of legislation and many others—

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I am very grateful to the noble Baroness for clarifying that, but does that not leave it completely open? If there is no deal, we have the SI. If there is a deal, presumably there will be discussion and negotiation to arrive at the deal, and this will be part of it. So the issues we are talking about are not settled in that situation. There will have to be discussions about how ERICs function, under what rules, and whether the CJEU is involved. All that stuff will have to come up again, I assume—I am a novice in this matter.

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I am very happy to be asked questions by a novice, although I do not believe that the noble Lord is a novice at all. He is right that discussions are ongoing, particularly in the area of research and innovation, which is a very important area of collaboration for us. He asked about the legislation. That is exactly what will happen. We are looking at one piece of legislation that may not be needed—in fact, there is a very small chance that it will be—but we have to be sure that we have it in case it is.

The noble Lord suggested that I might want to duck the question of the change in funding for research and innovation in the coming years. I am ducking. Obviously, I can make no commitment to future funding; that would be really unwise in the current environment. However, I want to address his point about future opportunities, because it is really important. We have tasked UKRI to develop the first UK national research and innovation infrastructure roadmap. By the end of next year, it will have completed its work and we will have a full understanding of where our money is going and what it is being invested in.

In the course of my research, I happened to find out that UK entities are involved in about 750 research infrastructures encompassing international, European and national RIs. I find that extraordinary. It is really important that we map all these things, examine where our gaps are and fill them.

I have just been told that I need to correct myself. I said that this SI is not needed in a deal scenario; it is needed in a deal scenario. I shall write to the noble Lord and absolutely clarify why it is needed.

The devolved nations have all agreed to the legislation. On immigration, the noble Lord mentioned the potential shortage of skilled labour. He will be aware that a White Paper on immigration will be published shortly. The Government will of course carefully consider the MAC’s recommendations before setting out further detail on the UK’s future immigration strategy. We recognise that we need skilled resources and that they can come from both European Union nations and other nations.

Given those responses and my promise to write on the critical detail concerning when we will need the SI, I commend the regulations to the House.

Motion agreed.