Tuesday 8 February 2022
Arrangement of Business
My Lords, Members are encouraged to leave some distance between themselves and others and to wear a face covering when not speaking. If there is a Division in the Chamber while we are sitting, this Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Divorce, Dissolution and Separation Act 2020 (Consequential Amendments) Regulations 2022
Considered in Grand Committee
My Lords, the draft instrument before us makes consequential amendments to primary and secondary legislation relevant to the Divorce, Dissolution and Separation Act 2020, ahead of its planned commencement on 6 April this year. The purpose of these measures is twofold: first, to introduce a new jurisdiction ground for joint applications for divorce—namely, either applicant’s habitual residence; secondly, to update the terminology relating to divorce proceedings consequential on the language changes made by the aforementioned divorce Act.
I will speak first to the amendments in paragraphs 1, 4, and 8 of the schedule to the regulations pertaining to the introduction of a jurisdiction ground for joint applications for divorce: namely, the habitual residence of either applicant. Jurisdiction grounds, in this context, are the grounds on which a divorce can be applied for and/or granted in the jurisdiction of England and Wales. The ground we are discussing sets out that, provided either applicant is habitually resident in England or Wales, a joint application can be made by both applicants within this jurisdiction.
This instrument amends a number of measures, including the Domicile and Matrimonial Proceedings Act 1973, the Civil Partnership (Jurisdiction and Recognition of Judgments) Regulations 2005 and the Marriage (Same Sex Couples) (Jurisdiction and Recognition of Judgments) Regulations 2014. To each of these pieces of legislation, it brings in the same ground to which I have just referred.
An equivalent jurisdiction ground appears in article 3 of EU Regulation 2201/2003, known as Brussels IIa. Until the end of the transition period, the Brussels IIa regulation jurisdiction ground applied to all cases of opposite sex divorce, legal separation and annulment in England and Wales. The United Kingdom is no longer governed by Brussels IIa, which was revoked by Statutory Instrument 519 of 2019. However, the choice was then made to replicate the applicable Brussels IIa jurisdiction grounds into domestic law by amendment to the Domicile and Matrimonial Proceedings Act 1973.
All the jurisdiction grounds in article 3 of Brussels IIa were replicated save for the ground that we are now discussing, that of habitual residence in joint applications. The sole reason why this ground was not replicated upon exit from the EU was because at that time it was not possible to make a joint application for divorce in England and Wales. With the commencement of the divorce Act, this will now be an option for the first time, so it would be remiss not to replicate this final ground now that the opportunity presents itself.
The same ground is also being introduced into the following measures: the Civil Partnership (Jurisdiction and Recognition of Judgments) Regulations 2005 and the Marriage (Same Sex Couples) (Jurisdiction and Recognition of Judgments) Regulations 2014. This ensures equality in all legislation relating to ending a partnership or marriage, regardless of whether these are between same or opposite sex couples.
The other amendments in this instrument amend language in the Domicile and Matrimonial Proceedings Act 1973, the Civil Partnership (Registration Provisions) Regulations 2005, the Pension Protection Fund (Provision of Information) Regulations 2005, the Financial Assistance Scheme (Provision of Information and Administration of Payments) Regulations 2005, the Civil Legal Aid (Merits Criteria) Regulations 2013, and the Civil Legal Aid (Remuneration) Regulations 2013.
The amendments update the terminology in relation to divorce consequential upon the language changes made by the divorce Act. The divorce Act amended terminology in the Matrimonial Causes Act 1973—for example, by the replacement of terms such as “decree nisi”, “decree absolute” and “petitioner” with “conditional order”, “final order” and “applicant”. This means that the same terms will now be used in legislation relating to both divorce and dissolution. It simplifies language too, making terms more recognisable and readily accessible to members of the public. This supports the aim of the divorce Act in supporting citizens representing themselves in divorce proceedings. This instrument consequentially replicates those language changes across relevant legislation.
By making the amendments I have outlined today, the intention is that we will standardise and update language across all relevant pieces of legislation and amend jurisdiction grounds to add a specific relevant ground for joint divorce applications. This instrument is consequential on the divorce Act, reflective of the ultimate aims of the divorce Act, to reduce conflict between couples and families. I beg to move.
My Lords, we support this instrument. I have just a couple of questions. I am surprised that the question of jurisdiction was not dealt with in the Act itself. Perhaps the Minister has some explanation for that, which I have not perceived.
My second question relates to paragraph 7.7 of the Explanatory Memorandum, which says:
“The Government’s policy intention behind the reformed law”,
which in turn has resulted in the consequential amendments contained in this instrument,
“is that the decision to divorce should be a considered one, and that separating couples should not be put through legal requirements which do not serve their or the state’s interests”.
I find that a bit puzzling, and I wonder whether the Minister can help me with what it is directed to. However, as I say, we support the amendments.
My Lords, we, too, support the regulations. The provisions are primarily to reflect the new terminology associated with the reformed divorce, dissolution and separation proceedings in the Act, as well as to add a jurisdictional ground for the newly created joint applications.
The Act has not yet come into effect, but we hope that it will soon and that there is no further delay. I think I heard the Minister confirm that the date will be 6 April 2022—he is nodding, so I take that as an indication that that is correct—which is very pleasing. My party fully supports that Act and the changes to divorce, dissolution and separation that it will introduce. As a result of this Act, it will be much easier for couples to divorce in cases where the relationship has irretrievably broken down.
We hope that this will end some of the adversarial system currently in place. A spouse will no longer be able to object to or oppose a divorce, and couples will no longer have to apportion blame for the breakdown, leading, we hope, to less conflict and acrimony for all involved. A simple statement that the marriage has irretrievably broken down should be sufficient for proceedings to commence. I am very pleased to welcome the measures that the Minister has outlined today.
My Lords, I am grateful to participating Peers for their contributions to the debate. The noble Baroness on the Labour Front Bench acknowledged that I had tacitly confirmed that 6 April was the commencement date—so I was able to answer that question without saying anything.
As to the two questions raised by the noble Lord, Lord Thomas of Gresford, on behalf of the Liberal Democrat Benches, I regret to say that I do not have ready answers to either—I beg the Committee’s pardon. I undertake to provide answers in writing to the noble Lord as soon as I am able.
Beyond that, I think I have registered agreement from both noble Lords who spoke that these merely consequential amendments are not contentious and bring about changes to standardise the approach to language and to jurisdiction grounds for divorce—ensuring, I hope, that legislation surrounding divorce is clear, simple and consistent across the board. I commend this instrument to the Committee.
Money Laundering and Terrorist Financing (Amendment) Regulations 2022
Considered in Grand Committee
My Lords, illicit finance not only risks damaging our reputation as a fair and open economy, it threatens our national security by undermining the integrity and stability of our financial markets and institutions. Illicit finance also causes significant social and economic costs through its links to serious and organised crime, and it can reduce opportunities for legitimate business in the UK. That is why the Government are focused on making the UK an inhospitable place for illicit finance. The Government recognise the threat that economic crime poses to the UK and are committed to tackling money laundering and terrorist financing. We have taken significant action to combat money laundering and terrorist financing and to strengthen the response of the whole financial system to economic crime.
Central to these efforts are the money-laundering regulations. They are a key part of our legislative framework and set out a number of requirements that businesses and trusts must comply with to make the UK an inhospitable place for money laundering and terrorist financing. These measures include the requirement for trusts to register with HMRC’s trust registration service. Trusts are an integral feature of the UK’s legal system and are used for a wide range of legitimate purposes. However, they can also be used to conceal the true beneficial ownership of assets and therefore impede law enforcement as it investigates money laundering and terrorist financing. The trust registration service addresses this risk by providing law enforcement with a key source of up-to-date information on the beneficial ownership of assets held in trust.
As a result of the changes introduced in 2020, the trust registration service has been expanded so that most types of UK express trusts are now required to register. In addition, overseas trusts with certain connections to the UK, including the acquisition of land or property in the UK, are now for the first time required to register.
The statutory instrument under discussion today amends the money laundering regulations to ensure that the trust registration service operates as effectively as possible as an anti-money laundering tool, striking the right balance between the public interest in tackling money laundering and the right to privacy for those who use trusts for legitimate purposes.
First, to ensure that trustees have sufficient time to gather the necessary information and complete the registration process, this instrument extends the registration deadline for those types of trusts newly required to register until 1 September 2022. Secondly, this instrument extends the time limits for reporting changes to the information held on the register. Trustees are required to update the register within certain time limits if the information held on the register relating to individuals involved in the trust changes. In recognition of the fact that such changes are often triggered by traumatic life events—for example, bereavements—this instrument extends the time limits so that trustees will have 90 days to report such changes to the HMRC.
Lastly, this instrument makes changes to the categories of trusts that are excluded from registration. Certain types of trusts that pose an inherently low risk of money laundering are excluded from registration. This instrument makes some small changes to the existing categories of excluded trusts to ensure that the burden of registration is proportionate to the money-laundering risk that particular types of trusts pose.
In summary, this instrument will amend the money-laundering regulations as they relate to trust registration, to ensure that the regulations strike the appropriate balance between providing an effective anti-money laundering tool for law enforcement and minimising the administrative burden on those who use trusts for legitimate purposes. This amendment will enable the money-laundering regulations to continue to work as effectively as possible, to protect the UK financial system and allow the UK to continue to play its role in leading the fight against economic crime. I hope therefore that noble Lords today will join me in supporting this legislation. I beg to move.
My Lords, I am grateful to the Minister for introducing this measure. It is good to have her back covering Treasury business again, albeit in somewhat intimate surroundings.
This SI has come at an interesting time, with ever-increasing interest in these matters. Its scope is relatively narrow, but that will not stop us from raising wider issues. The Explanatory Memorandum states that crime enabled by money laundering costs the UK at least £37 billion per year. I fear that the real cost is likely to be far higher. Costs for the financial services sector are also significant. Research published last summer put the annual cost of anti-money laundering compliance at almost £30 billion. That is generally money well spent, yet we still see examples of high-profile financial institutions failing to uphold their duties. The Financial Conduct Authority has acted in some cases, but funnelling dirty money into the UK still appears to be too easy.
It was interesting to see that the Explanatory Memorandum asserts that the UK is
“a leading member of the FATF”—
the Financial Action Task Force. We are, of course, a global financial centre but we are not immune from criticism, and the FATF has outlined a range of reforms that in its opinion need to be enacted. Is the Minister in a position to provide a progress report?
One of the concerns raised by the FATF—an organisation included in the OECD—relates to the potential for trusts to be used as a disguise for foreign or illicit ownership of assets. We welcome the requirements to register with HMRC’s trust registration service, the TRS, from 1 September this year, although we regret that it has been delayed due to IT complications. Can the Minister say a little more about this?
The regulations propose an extension of the 30-day deadline for submitting updates to information to the TRS to 90 days. While that makes some sense at first glance, we have some concerns. The change is justified on the grounds that some changes may arise from life events, such as bereavement, which involve processes that take far longer than 30 days. Of course, people should be afforded more time in certain situations, but the Government’s own 2020 consultation concluded that 30 days was ample time in the majority of cases. Can the Minister outline what percentage of cases are likely to require more than 30 days? Why did the Treasury not choose to retain that limit while introducing a degree of flexibility in certain defined cases?
Another concern returns us to the issue debated in your Lordships’ House only yesterday—that is, the extent to which information on the beneficial ownership of firms operating in freeports areas should be publicly available. In theory, information contained within this register is accessible to some members of the public. If that is genuinely the case, it is an improvement over the Treasury’s usual approach. However, concerns have been raised by a range of civil society organisations that the barriers to accessing the register are far too high, potentially freezing out some of the country’s leading independent experts. Can the Minister set out in detail the criteria for access to the register? Furthermore, I would be grateful if she could provide examples of the types of people who can access the register, and exactly how they would demonstrate their worthiness. We do not want to see frivolous requests but, surely, we should facilitate appropriate non-governmental investigations of illicit financial activity.
We shall not oppose the SI today; as the noble Baroness knows, I am rarely in the mood for causing constitutional crises. However, these regulations seem to be a half-baked response to a very serious problem. The register is late, it is not fully transparent, and the Government have ignored some of the outcomes of their own consultations. Following the resignation of the noble Lord, Lord Agnew, the Government said that they treated tackling economic crime as an urgent priority. I hope that urgency will be more apparent in future.
My Lords, I thank the noble Lord for his welcome to my return to Treasury matters—it is good to be back. I also thank him for the constructive approach that he takes in these debates. As such, I shall do my best to answer the questions that he posed to me on this statutory instrument.
The noble Lord asked about the progress that we had made on reforms outlined by the FATF. The recommendations in the Financial Action Task Force mutual evaluation have been taken forward through the landmark economic crime plan, which ran from 2019 to this year. We have strengthened our fight against economic crime through the publication of that plan in 2019, which brought together government, law enforcement and the private sector in close co-operation to deliver a response to economic crime. Significant progress has been made, with 24 out of the 52 actions now complete—and I understand that a higher number than that are on course to be complete within their aimed-for timetable.
The noble Lord asked for more detail on the IT complications and the reasons for the delay in the expansion of the register. We recognise that they IT service went live six months later than originally planned. The service needed significant development work to implement the required changes at a time when there was extraordinary pressure on public services and, in particular, on HMRC’s IT development resources. Between March and September, checks and tests by external users were completed to ensure that the service could be open to all users from September.
The noble Lord also asked about the extension of the period in which to notify changes to trusts from 30 days, and why we should not retain that limit and introduce some other form of flexibility. The expansion of the register of beneficial owners of trusts has brought a significant number of additional trusts into the scope of this work. We recognise that a very large number of trustees are private individuals with no professional expertise in managing trusts and, as the noble Lord recognised, many changes will be triggered by life events such as bereavement, where it is not necessarily realistic to expect individuals to update the register within 30 days. Continuing with this requirement would likely mean that a large number of individuals would find themselves in breach of the regulations without realising that fact. This change ensures that those who wish to comply will have sufficient time to do so. We do not have specific figures to estimate how many changes may be triggered by life events such as bereavement but, due to the way that trusts are used in the UK, this will be a common trigger for changes that need to be reported to the TRS.
On the question of retaining the 30-day limit but with an element of flexibility, I fear that this would still place affected individuals in a difficult and stressful position, as they would have to apply to HMRC for such flexibility with no guarantee that such a request would be accepted.
The noble Lord also asked, importantly, about the criteria for access to the register. We believe that placing the information held on the trust register in the public domain would infringe the privacy rights of individual beneficial owners, the vast majority of whom are not involved in money laundering activities. However, we recognise that, for the register to be an effective anti-money laundering tool, the information must be made available to those who are at the forefront of anti-money laundering investigations.
To that end, the information held on the register is available on request to law enforcement agencies. From 1 September 2022, it will also be available to any third party who can demonstrate a legitimate interest in the information held on the register. The regulations set out the criteria that HMRC must assess to determine whether a requester has a legitimate interest in the information held on the register. These include: whether the requester is involved in anti-money laundering; whether the request is being made for the purpose of furthering such an investigation; and whether the requester has reasonable suspicion that the information being sought relates to a trust being used for money laundering.
The Government will set out the detail of how those criteria will be applied in due course, but each request will be considered on its merits, and there is no desire on the part of the Government to prevent access to the information held on the register by those who are genuinely involved in anti-money laundering investigations.
Absolutely: that is a very reasonable request. I shall write to the noble Lord when the information is available, and also ensure that a copy is placed in the Library, if that is the appropriate place.
I hope that, in answering some of those questions, I have given the noble Lord a little more reassurance on the thought that has gone into this work so far. In summary, as I said, it is the Government’s view that the amendments contained within the regulations will assist in ensuring that the money laundering regulations operate as effectively as possible and continue to protect the financial system from the threat posed by money laundering and terrorist financing. They will also allow the UK to continue to play its part in the fight against economic crime, which, as the noble Lord noted, has been in the spotlight in recent weeks, and on which the Government have an ambitious agenda.
I hope that my responses have been informative and I commend the regulations to the Committee.
Health and Social Care Act 2008 (Regulated Activities) (Amendment) Regulations 2022
Considered in Grand Committee
My Lords, this statutory instrument will amend the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014. The 2014 regulations are currently due to expire after 31 March this year, and this statutory instrument will amend the expiry date to 31 March 2025. This is the only change this statutory instrument makes; it does not change any existing policy. The 2014 regulations set out the activities that are regulated by the Care Quality Commission and the fundamental standards that all CQC-registered providers need to comply with. These activities and standards will not be amended by this instrument.
The extension of the 2014 regulations to 31 March 2025 will ensure that the current regulations relating to CQC-registered providers, including which activities are regulated by the CQC, will continue to apply. There will be no change to how the CQC carries out its regulatory functions. The Government see the CQC’s role as critical in ensuring that the care received by patients is of high quality and delivered to standards that promote patient safety.
I should highlight that if we do not extend the expiry date, the 2014 regulations will automatically expire and there will be no regulated activities for the CQC to regulate, so providers who are currently required to register with the CQC will no longer be required to do so. Providers that are currently required to register with the CQC will also no longer be required to comply with the fundamental standards set out in the 2014 regulations, which help to ensure that services are carried out safely and to a high quality. The impact of not extending the regulations would be a risk to patient safety, as it would compromise the CQC’s ability to monitor providers against those fundamental standards.
In short, this SI will amend the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014 by extending the expiry date by a further three years to 31 March 2025. This means that health and care providers in England that carry out any of the regulated activities set out in the 2014 regulations will continue to be required to register with the CQC and will be bound by the obligations and standards set out in the 2014 regulations. This will help to ensure that patients continue to receive safe and good-quality care.
My Lords, the noble Baroness, Lady Brinton, is taking part remotely. I invite her to speak.
My Lords, first, I thank the technical wizards who have mended the problem with the link to the Grand Committee so that I can contribute remotely. This sort of thing happens only very occasionally, and the smoothness with which most of the business goes on is extremely helpful. I am very grateful to them.
The Explanatory Memorandum says that these regulations are to ensure protection from Covid, and the Minister has explained why there is a requirement to extend the deadline for the department to carry out a review of the CQC regulations. However, why are a further three years needed? Perhaps he can explain how there will be accountability between now and then to enable the House and Parliament to see the progress. Given that we are talking about three years, will he undertake to provide your Lordships’ House with an interim report on progress? If it takes the full three years, can that be on an annual basis?
Finally, and perhaps most importantly, can the Minister outline how the review fits in with ongoing reforms such as the Health and Care Bill, which will come to the end of Committee tomorrow, and other social care reforms? Will it keep pace with all those new developments?
I want to add one other item. The Minister knows that, when we had the Statement in the Chamber last Thursday, I asked him why care homes had not yet received the details of the change of rules about the compulsory vaccination of staff. He kindly said at the Dispatch Box that he did not have the answers to hand but would write to me and my noble friend Lord Scriven, who also asked questions about this that day. I do not appear to have had anything. Given that this covers care homes and keeping patients safe, I wonder whether I can ask again.
On Wednesday afternoon, the director-general for adult social care wrote to providers of CQC-regulated adult social care activities about the removal of vaccination as a condition of deployment. Unfortunately, the problem is that it specifically excludes care homes. I believe we know that the problem exists in regulations that need to be revoked, but can the Minister explain to the Grand Committee exactly what the problem is? Clearly, reading that letter from the director-general at face value, care homes are sitting in a limbo which no other parts of the NHS or the wider settings for care are in, in that they should be applying compulsory vaccination.
The Minister said on Wednesday that the intention was quite clear. Unfortunately, this affects care homes, because it is to do with employment law. I know that some care homes have already been approached by staff they had to sack, asking whether they can have their jobs back, while they are still waiting to hear formally from government about when the revoking of the regulations will come into force. I hope the Minister can answer my question on this.
My Lords, I thank the Minister for introducing this SI on Care Quality Commission registration, somewhat at the 11th hour before the current 2014 regulations run out on 31 March 2022. Of course, we fully support their extension beyond that date so that all providers of health and social care in England will continue to be required to register with the commission and to comply with the high patient safety and care quality standards it sets.
The SI is very brief and to the point, with the proposed extension to 31 March 2025 the only amendment to the 2014 regulations, and the activities regulated by the CQC and the fundamental standards with which all CQC-registered providers must comply all unamended and unchanged.
Like the noble Baroness, Lady Brinton, I fully understand the impact of the pandemic on the CQC’s capacity to undertake the full range of its work, but the Minister needs to explain why the extension of the regulations is for another three years, to 31 March 2025. Why so long? The Explanatory Memorandum says the extension is to
“allow the Government to review the 2014 Regulations to determine”
whether the scope of its current regulated activities
“is still proportionate to ensure that regulated activities are delivered safely to a high standard.”
The CQC’s role as regulator and the fundamental standards that it sets to ensure high-quality care are crucial. According to the Minister proposing the SI in the Commons on 26 January, time is needed
“to reform and consider the regulations more fully”.—[Official Report, Commons, 26/1/22; col. 8.]
This is a major review being undertaken by government, and we need to know much more about its extent and purpose. Why are three more years necessary to undertake this review? Can the Minister explain why, given its vital importance, the review cannot be undertaken in a shorter timeframe? What are the timescale, scope and terms of reference of the review? How are all stakeholders, including providers and patient organisations, to be consulted and involved?
As the Minister knows, under the Health and Care Bill currently in your Lordships’ House, the CQC is to take on the not inconsiderable additional duties of reviewing and assessing ICBs and the performance of local authorities in the delivery of adult social care. To what extent will consideration of the impact of this extended role be included in the review, including the significant additional resources that the CQC will need to undertake these new areas of responsibility?
We are less than two months away from when the current regulations expire, and we fully recognise the urgent necessity of this SI to ensure that the CQC’s vital role and that work will continue. I also look forward to the update that the noble Lord will provide on the questions raised by the noble Baroness, Lady Brinton, about care homes and last week’s decision on the mandatory vaccination of staff.
My Lords, I thank both noble Baronesses for their questions and I must say how grateful I am that we were able to find a way for the noble Baroness, Lady Brinton, to join us after a technical fault. I turn now to the questions asked and, if I do not have the answers, I will commit to writing to the noble Baronesses.
The noble Baroness, Lady Brinton, asked why it had taken time to lay these amending regulations to extend the date of expiry of the regulations. They came into force in 2014 and a further amendment was made in 2015 to include an expiry date for them. Once it was identified that the 2014 regulations needed to be amended to extend the expiry date, the department took the appropriate action to make the necessary change. However, to make that change there was a long lead-in time, involving a consultation process and securing parliamentary dates to debate the amendment. The department is aware that, since the 2014 regulations came into force, there have been a number of changes in the health and care sector, and any wider review will be subject to a public consultation.
The noble Baroness, Lady Brinton, also asked about vaccination as a condition of deployment policy in adult social care settings. Let me turn, first, to her specific question. After the debate the other day, the noble Lord, Lord Scriven, told me that he needed to clarify a question he asked of me. He very kindly emailed me, clarifying that what he had said in the Chamber was not necessarily absolutely correct, and I sent his email on to my officials. I am sorry, I had not realised that a response had not been given. All I can do is apologise, go back to the department and make sure that we get an answer to him as soon as possible. That is why, to be perfectly frank, I am not in a good position here, because I really did think that this had been dealt with, and I apologise for that.
The noble Baroness, Lady Wheeler, asked several questions about the department’s intention to carry out a post-implementation review of the 2014 regulations. The department intends to carry out such a review and is currently working with the CQC to develop the review questionnaire, which will be shared with health and social care providers. The department is in the early stages of undertaking work to carry out the review, and we have already started working with the CQC. Once we have the responses to the questionnaire, we will publish a post-implementation report setting out the department’s findings.
The noble Baroness, Lady Brinton, also asked about VCOD. One of things we should stress—I know all noble Lords agree on this—is that patient safety is key. We always put the safety of vulnerable people first. I am very grateful to noble Lords for their support for the VCOD policy.
We felt it was right when we brought it in for care homes, and then extended it to the wider care sector. Given that delta has been replaced by omicron, it was only right that we reviewed the data and the evidence, and also reviewed the policy. As I said, I am afraid I do not have a detailed answer to the question at the moment. All I can say on why we have asked for three years is that I did ask the officials why three years, why not a year or two years, given the Health and Care Bill and the additional responsibilities that will fall on the CQC when it comes to that Bill, and they said generally that they needed three years for the long process, the lead-in and the consultation, and also to take account of the wider review. Next time it will not simply be an extension of the current regulations; the wider review will take account of what new duties are placed on the CQC, as a result of the Health and Care Bill.
I am afraid—and I really apologise for this—that I do not have the best answers for this at the moment. I will have to write in more detail to the noble Lords who asked questions.
My Lords, I thank the Minister for his response. Specifically on the review into the CQC’s work, I did ask for the terms of reference. I know there is going to be a consultation and a questionnaire, et cetera, and I would like to know what the terms of reference are: the timeframes and the scope of the review, and how stakeholders will be involved—I hope it will be not just by a questionnaire.
Representation of the People (Proxy Vote Applications) (Coronavirus) (Amendment) Regulations 2022
Considered in Grand Committee
That the Grand Committee do consider the Representation of the People (Proxy Vote Applications) (Coronavirus) (Amendment) Regulations 2022.
Relevant document: 27th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument by the Joint Committee on Statutory Instruments, 22nd Report)
My Lords, the instrument brought forward today makes a practical provision to continue support of the effective administration of elections. It does this by extending the Representation of the People (Proxy Vote Applications) (Coronavirus) Regulations 2021 for a further 12 months. These temporary regulations were first introduced ahead of the May 2021 elections. They allowed electors to appoint an emergency proxy, or change their existing proxy arrangement, up until 5 pm on the day of the poll where they were, or in fact their previously appointed proxy was, unable to attend a polling station due to Covid. This was without any form of attestation, which is normally required for a standard emergency proxy. It was part of a range of measures that helped ensure elections have been able to take place safely over the course of the last year.
While much has changed in the intervening 12 months, and is changing, extending this measure is prudent. While we have been able to remove a great many of the restrictions that Covid has made necessary, it is still the case that those who test positive for Covid are legally required to isolate—as some of their close contacts may be. While that is the case, and as the situation and exact nature of any isolation requirements going forward remain difficult to predict, we must ensure that those required to isolate are not, in the process of doing so, deprived of the ability to participate in the vital democratic process. So this is a tested and appropriate way to continue to protect that process during the pandemic. Now is not the right time to abandon this necessary temporary measure.
I will now move on to the specific details of the statutory instrument. The key purpose is to extend for a further 12 months the regulations brought into effect by the 2021 instrument, which is due to expire on 28 February 2022, so that instead it expires at the end of February 2023. We will keep this under review, and we will also consider repealing the regulations early, should they no longer remain necessary and proportionate.
The instrument will also remove the existing reference to the “clinically extremely vulnerable” and people who are
“at the highest risk of severe illness from coronavirus”
from the 2021 regulations. This terminology was used in England and Scotland respectively and its removal will bring the wording into line with the latest respective government guidance. Anyone following advice from a registered medical practitioner or a registered nurse to isolate will still be able to apply for an emergency proxy under these rules. This ensures that electors unable to attend the polling station for Covid-related health reasons will not be adversely affected.
The instrument applies to UK parliamentary elections in Great Britain, police and crime commissioner elections in England and Wales and local elections in England. The Scottish and Welsh Governments have also either extended their equivalent arrangements for their respective devolved elections or are in the process of doing so.
It is essential to our democracy that people are able to cast their vote. The 2021 regulations brought into effect a temporary measure to ensure that those required to isolate shortly before a poll could still vote, or that a proxy arrangement could be amended where the appointed proxy was unable to attend a polling station for Covid-related reasons. This instrument is a simple, yet vital, extension of that measure. It will cover local and mayoral elections in England scheduled for May 2022, as well as any applicable by-elections or unscheduled polls that occur before the May 2023 polls. However, as I outlined earlier, we will keep these measures under review and we will consider repealing them early, should they no longer remain necessary and proportionate.
I can assure noble Lords that we have consulted with the Electoral Commission and that it is supportive of this measure. I note also, and am grateful for, the cross-party support that the 2021 regulations received when brought forward last spring, and I hope very much that there will be support for their sensible and necessary extension. I hope that colleagues will join me in supporting the draft regulations. I commend them to the Committee and beg to move.
My Lords, this proposal to extend the rules governing late proxy vote applications as a consequence of coronavirus medical advice, including self-isolation, is appropriate and, as the Minister has just said, prudent. The consultation on the measures with the Parliamentary Parties Panel elicited no comments and the Electoral Commission seems content as well, so there is no reason, in my view, for this Committee to take a different view. It is anyway a sensible measure that is time-limited to a further 12 months.
I understand the comments of the Joint Committee on Statutory Instruments on the clarity of the territorial and temporal limitations imposed by Regulations 1 and 2, but I also understand the complexities of drafting these regulations. The commitment of the Department for Levelling Up, Housing and Communities to bear in mind the comments made about clarity should suffice, since this is in effect a one-year extension to an existing set of regulations.
The noble Lord in his opening comments made reference to the previous SIs, which were debated in the Chamber on 4 March last year and which included a number of changes, as he indicated. One of them was in relation to the number of signatures that could be required for nominations for local elections: it was previously 10 and was reduced to two in the circumstances relating to coronavirus.
At the time the subject was debated, I indicated that I regretted that the change was time-limited to end in February 2022. Since then, consultations have taken place. I know that I speak in support of the views of the LGA and that this matter has been discussed informally at the Parliamentary Parties Panel in the presence of the Electoral Commission. There is therefore general all-party support—although I say this without having consulted the Green Party; I know that the noble Baroness, Lady Bennett, is due to speak in a moment so she may express a view. But there is a general all-party view that the one, time-limited exemption to the end of February 2022 should now be lifted and that there should be an ongoing exemption. That would fit in with the spirit of the SI to which we are referring today.
I failed to say at the start of my comments that I had given the Minister and his office notice that I was intending to cover this point. Given that we are nearing the local elections, I hope that the Minister will be able to indicate that something which has all-party support can be expedited, that the time limit should be removed and that we can go on using two signatures, which is more than is required now in Wales and Scotland.
My Lords, as is evident, the noble Lord, Lord Hayward, and I have not consulted in advance on this. I very much agree with his comments, and indeed I offer further cross-party support to this amendment. I also wanted to raise a question about why this is only for 12 months and to look at the practical situation that we are in now.
The Minister in introducing this SI focused rightly— I have absolutely no disagreement on the democracy side of this SI—on the obvious public health element here. You do not want people with a contagious illness, very keen to vote, trailing into the polling station, with all the obvious risks of spreading that disease further. If we look back over recent history—SARS, MERS, swine flu, the threat of bird flu—we are in a new age where contagious illness is becoming more of a threat and a problem. We also have a big problem with antibiotic resistance to a variety of diseases.
To preserve both democracy and public health, the department, parties and everyone should think about the fact that contagious illness is a threat to us all. I do not necessarily expect a sudden big announcement today, but I want to put that on the agenda. People want to do the right thing both for democracy and not to spread an illness. Obviously, illnesses come on quite quickly—it is not something that you can predict—so it would make sense to have a measure like this for all relevant illnesses, both for democracy and for public health.
My Lords, as we heard from the Minister, this instrument extends the legislation which allows late proxy vote applications for those who are required to self-isolate. As the Minister and others have said, we fully supported the measures when they were first introduced and continue to support them, so I will be brief. At that time, we warned the Government that they may well need to extend the measures, which unfortunately they have now had to do.
Allowing for late urgent applications to vote by proxy when an individual is required to self-isolate, in response to other coronavirus-related medical advice or if things change for a proxy who goes through the same thing is, we believe, an important part of maintaining our democracy during these uncertain times. Unfortunately, the reality is that it looks like we will be dealing with the pandemic for some time to come as we learn to live with it. We believe that this instrument is a sensible adjustment to support democracy during this time.
The Explanatory Note states that the amendments to the regulations
“remove the ground for applying late where an applicant or their previously appointed long-term proxy has received notification that they are clinically extremely vulnerable or that they are at the highest risk of severe illness from coronavirus.”
I understand from the Minister’s introduction that this is to ensure that the regulations align with current medical guidance. However, just for clarification, can the Minister provide assurance that those individuals would still have access to a proxy in the way that they did, provided that that is in line with what their medical practitioner advises?
The noble Baroness, Lady Bennett, talked about this, but one thing that I was going to suggest from the Opposition was that these provisions could well be made permanent for all medical reasons, given that there will always be examples of people who find themselves unable to vote in person at a late stage, due to illness. I also express my support for the noble Lord, Lord Hayward, regarding his proposals on two signatures for candidate nominations. I just draw attention to the fact that I was in fact a signatory to his letter on this matter.
My final point is an important one, and I hope that the noble Lord would agree with me on this, because it is around potential electoral fraud. We know that the Government have expressed clear concerns in the Elections Bill around electoral fraud, and proxy votes are being looked at as part of that. While we consider the SI before us today, what steps are the Government taking to ensure that emergency proxy votes still have the right kind of safeguards against electoral fraud?
My Lords, I thank all those who have taken part in this short debate, and I particularly welcome the general support given on behalf of all parties, starting with the noble Lord, Lord Shipley, and for the recognition that the timely completion of this instrument is crucial in ensuring successful running of polls throughout 2022 while Covid regulations remain in place.
The immediate assurance that I can certainly give to the noble Baroness, Lady Hayman, is that there is absolutely no question of reducing the extent of protection for those in what was originally defined as the shielding groups. Under the extended regulations, electors will be able to appoint an emergency proxy to vote on their behalf without attestation when they are legally required to isolate and when attending a polling station would be contrary to advice provided by their medical professional—the kind of group that she described—and, indeed, when they believe that attendance at a polling station could lead to transmission of coronavirus. For example, they may be displaying symptoms but awaiting a test result. That picks up on what the noble Baroness, Lady Bennett, was saying. Electors are also able to amend their existing proxy arrangements at very short notice, when the proxy is unable to vote on their behalf, due to the reasons above. So the technical change in wording does not reduce to any degree the availability or accessibility of arrangements, and I am very glad that the noble Baroness raised it. If I had been in her place, and seeing these words disappearing, I would have wanted to ask that question, which is why I anticipated it to some degree and mentioned it in my opening remarks.
My noble friend Lord Hayward, with support, raised the question of correspondence between him and my department, and indeed, DLUHC on this matter. As he knows, as part of our consultation on the Elections Bill this morning, we also discussed the matter. The statutory instruments here—this one and others—were made in the context of the height of the original Covid pandemic, when the Government were encouraging absolutely minimal social interaction and there was legislation in place restricting such activity. That is no longer the case, and therefore we judge that the measure is no longer necessary on Covid grounds. The Government are clear that it is important that the democratic process is as accessible as possible, and making that change permanent for specific polls, for which my noble friend asks, would need consideration in the context of wider electoral policy and legislation.
However, I welcome the point raised by my noble friend and by the noble Baroness opposite, and the Elections Bill is coming before your Lordships’ House very shortly. The Government are certainly open to further discussion on this topic. The existing arrangements have been useful. It may interest the House to know that in the May 2021 PCC, mayoral and local elections, there were 2,800 instances in which the facilities afforded by these regulations were made use of. That is not a phenomenal number of people, but they were used by certain people at the height of the pandemic, so they have been useful. We consider that while the pandemic continues, it is worth extending the provision allowing electors to appoint a proxy or change their existing proxy up until 5 pm on polling day on various grounds relating to Covid. That is sensible, but there is a point on the other side, fairly made by the noble Baroness, that there is a balance in these things when making permanent procedures which might make it easy to circumvent the normal controls. This is a specific measure introduced to help people during the course of the pandemic. However, the Government are considering very carefully that balance, and I look forward to discussing it during the course of the Elections Bill.
I hope I have responded to—
I seek clarification in the light of what I understand my noble friend to have just said. We had previously written, seeking on behalf of all parties and organisations such as the Local Government Association—which supports the proposal—and the intention was quite clear in the correspondence that I wrote, originally almost a month ago, that there would not be the opportunity for an SI to be brought forward now and that, therefore, we would have to wait for the Elections Bill for such a change to be implemented. If that is the case, I regret, given that the conversations have been ongoing, that I and others—including the LGA and others, not only political parties but organisations representing interested parties—could have been told or received some indication previously.
My Lords, I am disappointed by my noble friend’s comment. I regret that he is disappointed. The regulations we put in place were clearly time-limited and intended to be so. I indicated to him, as he well knows, in correspondence that took place and my response to the noble Baroness opposite, that the Government are open to discussion on this particular point, but the Government believe that careful consideration must be given to it in view of some of the implications. No doubt, my noble friend will have the opportunity on the Elections Bill to raise the matter again.
I can assure my noble friend that no personal discourtesy was intended by me or, I am sure, by any Minister in the responsible department in failing to deal with this matter in the timescale he asked for. If he has been offended, of course I regret that, but I stand by the position that I put before your Lordships, which I thought was fair. I think I said that I welcomed the point that he and the noble Baroness opposite had raised and that we are open to further discussions on this topic. I made the same point to my noble friend this morning in the exchanges we had on the Elections Bill, and I have nothing further to add.
Non-Domestic Rating (Levy and Safety Net) (Amendment) Regulations 2022
Considered in Grand Committee
My Lords, these regulations make changes to the way in which we calculate levy and safety net payments as part of the business rates retention scheme. The changes are necessary to ensure that the calculations reflect the current circumstances of local government and that individual authorities receive or pay no more or less than they should.
Under the business rates retention scheme, authorities that see their business rates income fall significantly in any year can receive a safety net payment. The cost of the safety net is paid for by recovering, through a levy on growth, a percentage of the business rates income of authorities that, in any year, have seen their business rates income significantly increase. The detailed rules about the calculation of levy and safety net payments are set out in the Non-Domestic Rating (Levy and Safety Net) Regulations 2013.
The regulations before the Committee make a number of changes to the 2013 regulations. They do four things. First, they update the 2013 regulations for 100% retention authorities. The Committee will recall that, since 2017-18, the Greater Manchester, Liverpool City Region, West of England, West Midlands and Cornwall authorities have retained not 50% but 100% of the business rates they collect. As a result, we made changes to the levy and safety net calculations to reflect authorities’ higher business rates income. These changes have been reconfirmed periodically in regulations as and when the Government have extended the 100% arrangements.
As things currently stand, the changes to levy and safety net calculations for 100% retention authorities apply in every year up to and including 2020-21. However, because the Government have now confirmed that the 100% arrangements will stay in place in 2021-22 and 2022-23, we need to extend the timeframe over which the changes to levy and safety net calculations apply. This is provided for in regulations.
Secondly, in Regulation 6 we amend the levy rate of the Greater Manchester authorities. Until recently, the Greater Manchester authorities were part of a pool with an authority that was not involved in the 100% arrangements, so the levy rate was calculated for the pool as a whole. The pool arrangements finished at the end of 2021. From 2021-22 onwards, therefore, these regulations will ensure that the levy rate that applies to the Greater Manchester authorities will be zero, bringing it into line with the levy rate in other 100% retention authorities.
Thirdly, the regulations make a number of changes to deal with the consequences of local government restructuring. When the structure of local government changes, some of the values in the levy and safety net calculations need to change so that they reflect the business rates bases and revenue needs of the new authorities. For the current year, 2021-22, amendments are needed in respect of the newly created authorities of North Northamptonshire and West Northamptonshire, and for the creation of the Hampshire and Isle of Wight Fire and Rescue Authority. These changes are made in Regulations 3, 5, 6, 7 and 8, with the updated figures set out in new Schedule 6.
Lastly, the regulations make changes to reflect the exceptional financial support that was made available to authorities in 2020-21 and 2021-22 following Covid. Noble Lords will recall that, in response to Covid, the Government exceptionally waived the business rates bills of the occupiers of eligible retail, hospitality and leisure properties and of eligible childcare providers, thereby helping those ratepayers to cope with the financial impact of the lockdowns and restrictions that were put in place to tackle the pandemic. Ratepayers’ bills were reduced by over £11 billion in 2020-21.
We have continued to provide support to retail, hospitality and leisure businesses and childcare providers, with an estimated £5.8 billion of relief to be given this financial year. Furthermore, we have recognised the strain on other businesses and have announced an extra £1.5 billion of Covid additional relief funding, to be allocated by local authorities in line with the needs in their local areas.
Of course, this unprecedented reduction in bills, although welcome to ratepayers, has deprived local authorities of a commensurate amount of business rates income. To support the delivery of local services, the Government have therefore compensated local authorities for every pound of business rates income that they have lost as a result of awarding additional reliefs to ratepayers. The compensation, via a grant from central government under Section 31 of the Local Government Act, has been paid up front to authorities to ensure that they had the cash they needed to deliver local services in 2020-21 and 2021-22. The further support, in the form of the £1.5 billion of Covid additional relief fund, will be paid to authorities as soon as possible.
If we did nothing to the 2013 levy and safety net regulations, the loss of income caused by the reduction of ratepayers’ bills and the additional reliefs awarded by authorities would mean that in some cases authorities would receive substantial safety net payments, even though they have already been compensated by means of a Section 31 grant. Therefore, in Regulation 7 we make changes to the 2020-21 and 2021-22 levy and safety net calculations to strip out the impact of income reductions that have been, or will be, compensated via a Section 31 grant. This means that those authorities will not be compensated twice for the same loss of income.
As well as compensating authorities pound for pound for the estimated £18.5 billion of support that we are providing to ratepayers over two years, we have taken further steps to help authorities through a tax income guarantee. Under that guarantee we are providing additional compensation to authorities for losses of business rates or council tax income in 2020-21. For business rates losses over and above those resulting from the reduction in ratepayers’ bills, authorities are being compensated for 75% of the additional loss. But, of course, in the same way as for the Section 31 grants paid to major precepting authorities, we need to change the regulations in 2020-21 to ensure that authorities are not compensated twice for the same loss of income. Regulation 8 and new Schedule 1B change the basis of the calculation of levy and safety net payments to ensure that losses of business rates income do not generate safety net payments if the authority is receiving support through the tax income guarantee.
In conclusion, these regulations make a series of very technical changes to the calculation of levy and safety net payments to ensure that they reflect current circumstances and that authorities will pay or receive the correct levy and safety net payments. I commend them to the Committee.
My Lords, I should first remind the Committee that I am a vice-president of the Local Government Association.
In the House of Commons, these amended regulations took just 15 minutes to be explained and approved, and that seems to be because they are appropriate in the circumstances. The revised levy rate for Greater Manchester looks right, since the pool arrangements, as the Minister said, have ceased. It is also right that the restructuring of a few local authorities has been reflected in new, updated figures.
We should support financial relief from business rates for businesses impacted by Covid being fully compensated to local authorities, in line with previous decisions earlier in the pandemic. It is, however, clearly important that the businesses rates retention scheme works as it was intended to. I think it would be wrong to give safety-net payments to some local authorities when they are already compensated by the Government directly, and the proposals on proxy figures for the limited number of 100%-retention authorities seems appropriate.
All the amendments in this statutory instrument today are technical and sensible. But the context is one of a system of business rates that is no longer fit for purpose. It does, however, generate a huge amount of income. I am left wondering what the Government are now thinking about the future of business rates—so anything the Minister can tell us on that would be most welcome.
Finally, I read the comments of the Secondary Legislation Scrutiny Committee published on 3 February, and I think the committee was right to raise the issue of whether the public are adequately protected against fraud, given public concern about false claims in other areas of Covid support payments. This is, of course, a relief scheme, and relief schemes are part of normal local authority systems and subject to normal audit systems. However, the Minister might wish to confirm that the Government feel adequately protected, given that it is their money that is helping to fund the cost.
My Lords, I thank the Minister for his introduction to this instrument, which, as we have heard, makes various changes to the business rates retention scheme. As we also heard from the Minister, each change is very technical, including amendments to levy and safety-net payments, the restructuring of certain local government areas and the payment by central government of specific grants to local authorities. I will not cover any of the technical detail: the noble Lord, Lord Shipley, amply covered that and asked the questions in these areas that needed to be asked of the Minister, so I will not repeat them.
I will briefly say that Labour supports these changes. However, in the other place when the matter was discussed, some important points were raised about business rates and our high streets. The Minister may remember that yesterday, in the Statement on levelling up, I talked of the need to completely reform and replace the current system of business rates. I appreciate that the terms of the SI before us today are very narrow and that this is not the place to debate that, but I ask the Minister to take our concerns about the current system back to his department. The Government have spoken already about the need to reform the business rates system and have conducted a review, but we have seen little progress to date beyond narrow technical legislation such as that before us today. I encourage the Minister to give his department a nudge. Having said that, we are very happy to support the regulations.
My Lords, I thank the noble Baroness, Lady Hayman, and the noble Lord, Lord Shipley, for their contributions. I thank them both for raising similar issues. While this is a very narrow statutory instrument, it is probably worth saying, thinking about the future business rates is very much a matter for the Treasury. There is a recognition that future business rates need to be thought through. Obviously, there is a review and, self-evidently, there needs to be reform.
Equally, there is the issue alluded to by the noble Lord, Lord Shipley, on what we do about local government in the context of the income for local authorities being council tax and business rates, and business rates fundamentally needing to change to reflect the changing dynamics of our high streets. There is an intellectual debate that can be had about whether we continue to resource equalise, or whether we think about life as a race, whereby we ensure the start line is level and fair and then you get places essentially to compete and, through competition, raise the game. That is an intellectual debate that is entirely proper, not for this statutory instrument, but it one that I like engaging in with people who have a very deep knowledge of local government and care about its future. It is really hard to be fair if you have officials working formulae that only they seem to understand to determine whether a place gets x money or y money. It is job of work that, necessarily, the Secretary of State will be looking at—it is far above my pay grade—but I have been a huge advocate of ensuring that local authorities can be set free to be able to determine their own destinies, rather than being necessarily being always funded from the centre, in the relationship we have today. That is how it has always been, for over 20 years, in my time in local government—but that is not really a matter for today’s debate. I am sure that we will have many debates about this in the Chamber over the coming years.
I have something else on this as well. Local authorities are responsible for the administration of release and provide us with assurance on the use of release. These are not grants but reflect a discount on the liability of a business. Local authorities can take action against any relief that is fraudulent. Does that help the noble Lord, Lord Shipley?
Clearly, we need to ensure there are proper controls in place, both at the local authority level and the Government need to look at it as well. I think that is very wise advice, and we will take that away from this debate.
In conclusion, these regulations are necessary to ensure that the rates retention scheme continues to operate as was intended and that authorities receive the safety-net payments to which they are entitled or make the levy payments due from them. Without these regulations, the amounts paid or received by authorities will be wrong and will impose additional costs on local government as a whole. The regulations ensure that this does not happen, and I hope the Committee will join with me in supporting them.
Waste and Agriculture (Legislative Functions) Regulations 2022
Considered in Grand Committee
My Lords, the instrument before us was laid before the House on 13 January. It makes small but crucial changes to repatriate powers to the UK and correct an error in a previous agriculture SI by restoring an accidentally omitted definition of an appropriate authority. This instrument covers two subject areas: waste management and agriculture. I shall take them in turn.
First, for waste management, this instrument transfers powers relating to several directives concerning waste from the European Commission to the Secretary of State. Where appropriate, these powers are also transferred to the devolved Administrations. The powers will largely give the Secretary of State and, where appropriate, the DAs, the ability to make regulations to set various technical standards, criteria, thresholds, and conditions. All these standards are currently operational, and we do not anticipate the need to alter them soon. However, there may be a need to amend them in future. For instance, should a superior waste treatment method be developed, without the amendments made by this SI we would not be able to make regulations to take account of the new method, which may weaken our high environmental standards.
I shall briefly outline the power, or powers, being transferred from each EU directive. Regulation 5 transfers the power to set standards for the sampling of waste going to landfill from the landfill directive. Regulations 6 to 9 transfer powers from the end-of-life vehicles directive to update and modify exemptions covering the use of certain heavy metals in vehicles based on scientific or technical progress; to specify minimum requirements for the certificate of destruction for waste motor vehicles; to modify conditions for storage and treatment for waste motor vehicles in line with scientific or technical progress; and to specify material and component coding standards for vehicles.
Regulations 10 to 11 transfer powers from the mining waste directive to modify non-essential elements such as guidelines for inspecting waste facilities and sampling methods, and to update regulations in line with scientific and technical progress. Regulations 12 to 13 transfer powers from the batteries directive to specify export criteria and to grant exemptions from labelling requirements for batteries and accumulators.
Regulations 14 to 17 transfer powers from the waste framework directive: first, powers to prescribe detailed criteria for what substances may be considered a by-product of a manufacturing process rather than a waste product, whereupon it can be sold or treated differently; secondly, powers to prescribe detailed criteria for when waste may no longer be considered waste, such as if the substance can be put to a more useful purpose elsewhere; and, finally, powers to specify the application of the formula for incineration facilities.
Regulations 18 to 20 transfer powers from the waste electricals and electronic equipment directive to update selective minimum treatment technologies for waste electrical and electronic equipment, or WEEE; to update the technical requirements for WEEE treatment and storage operations and the non-exhaustive list of products listed as falling into each of the categories specified in the WEEE directive; and to update the crossed-out wheeled bin symbol. These powers could, for example, be used to tighten treatment requirements of substances in WEEE found to be hazardous to health and the environment. The powers, apart from those relating to the batteries directive and the mining waste directive, will apply in England, Wales, Scotland, and Northern Ireland. The powers relating to the batteries directive and the mining waste directive will apply in England, Wales, and Scotland but not in Northern Ireland.
I shall now cover this instrument’s effect on agriculture- related legislation. This instrument amends Regulation (EU) No 1306/2013 of the European Parliament and of the Council as it relates to the organisation of common markets and rural development measures. Regulation-making powers from that regulation were previously transferred to the Secretary of State and their counterparts in the devolved Administrations by three EU exit SIs. However, the effect of the interactions between these three SIs has resulted in Regulation (EU) No 1306/2013 no longer containing a definition of “appropriate authority” in relation to the financing, management and monitoring of the organisation of common markets and rural development measures. Therefore, this instrument reinserts the definition of appropriate authority into Article 2 of Regulation (EU) No 1306/2013 and revokes the ineffective definition in a previous EU exit SI, the Agriculture (Payments) (Amendment, etc.) (EU Exit) Regulations 2020, to correct this deficiency.
No impact assessment has been prepared for this instrument, because this instrument only repatriates powers to the UK and corrects an accidental omission in a previous EU exit SI. The impacts will be considered if regulations are made using the repatriated powers.
Safeguards are provided through a requirement, in relation to the waste-related powers, to consult appropriate authorities and such other persons as the Secretary of State or the devolved Administrations consider appropriate, before making regulations under these powers. Any regulations made under these powers would receive Parliamentary scrutiny through the negative procedure, except one agriculture-related power to make regulations in the event of an emergency to make payments to beneficiaries. This allows use of the urgent affirmative procedure where it is both necessary and justifiable to ensure that beneficiaries can be paid.
I commend these regulations to the Committee and I beg to move.
My Lords, I am most grateful to my noble friend for such a full explanation of the impact of this measure. Did I hear him say that this will allow the Government and the devolved Administrations powers to amend the waste regulations, presumably in their area? Does he expect the powers to vary between the different areas? On the disposal of cars, one can see that a devolved Administration could perhaps make the regulations less onerous and thereby attract cars for disposal to set up a bit of industry or activity in their area. Have the Government considered that? Is it likely to be beneficial in these areas?
My Lords, I thank the Minister for his full introduction to this relatively straightforward instrument dealing mainly with waste. The Explanatory Memorandum claims that without this SI it would be “cumbersome” and difficult to make any necessary changes to take account of new methods of sampling and waste treatment in future.
Paragraph 7.2 of the EM sets out the functions already in place and working well but does not mention those that are perhaps not working well. Is the Minister able to say whether any of the functions under the EU directives concerning waste that have transferred are not working as expected?
I am afraid I have some somewhat detailed questions. The various categories of waste covered by this SI are wide. In Chapter 5, Regulations 12 and 13 deal with the retention of functions from the batteries directive. This includes powers to specify criteria relating to the export of waste batteries. Regulation 12(1) states that an
“appropriate authority may, by regulations, make provision specifying criteria for the assessment of equivalent conditions where treatment and recycling of waste batteries takes place outside the United Kingdom.”
The Minister will know that all households are now aware that they cannot just throw their expired batteries into the waste bin but have to dispose of them safely. Having disposed of my batteries in the relevant safe way, I am sure I am not alone in not expecting them to be exported for their final resting place. Can the Minister say just what percentage of the
“batteries, accumulators and battery packs”
referred to in Regulation 13 is disposed of within the United Kingdom and what percentage is exported for disposal, and which countries take our batteries for disposal?
While I have not read all the directives covered by this SI, I have done some investigation on the mining waste directive, 2006/21/EC. This covers extractive waste from land-based extractive industries and the relevant regulatory procedures required for England and Wales under the Environmental Permitting (England and Wales) Regulations 2010. This relates to unpolluted soil, non-hazardous waste from prospecting of mineral resources, except oil and evaporates, and waste from peat extraction. The definition of extractive waste is unpolluted soil and waste arising from prospecting for mineral resources and from peat workings. I am sure the Minister can see which way I am going.
Article 3(15) further states that for a site to be considered as a mining waste facility, the extractive waste would have to be kept in it for differing periods of time depending on the category of waste. For
“unpolluted soil, non-hazardous prospecting waste, waste resulting from the extraction, treatment and storage of peat and inert waste”,
this is specified as
“a period of more than three years”.
Can the Minister say what the average time period of storage is for extractive peat waste and what the quantities are currently likely to be?
The section in the instrument relating to agriculture is at the end under Part 4 and relates solely to the financing, management and monitoring of the common agriculture policy, in so far as it relates to CMO markets and rural development measures, and corrects errors in previous SIs on the subject. Given the number of SIs in the past on this subject, although they were before the Minister was in post, can he give reassurances that this SI is a catch-all and corrects all previous errors, or are there likely to be more? As I said, this is something of a tidying-up SI, and I am happy to support it.
My Lords, I thank the Minister for his introduction to this SI, and the Secondary Legislation Scrutiny Committee for drawing this SI to our attention. As the Minister said, the SI proposes to transfer several technical powers relating to waste from the European Commission to the Secretary of State, as well as correcting an error. In this regard, I have a number of questions.
First, can the Minister say when the error was first identified and why it has taken so long to bring the correction before us? This partly echoes the point made by the noble Baroness, Lady Bakewell, that a lot of water has gone under the bridge since the SI was first drafted. We have dealt with a number of corrections over the years, so why has this one taken so long? Perhaps he could address that point.
Could the Minister also say whether there have been any adverse consequences resulting from this drafting error? If there was no definition of the appropriate authority, I would have thought it undermined the whole legislation and that the legislation had no standing if it did not say who had the authority to carry it out. I would like to have a better understanding of what has been happening in the intervening period since the original wording was agreed by us. Perhaps he could also explain how that error came to light and why that took so long.
Secondly, referring to the various waste management standards, which the Minister said are all currently operational, can I double check whether all those standards were approved by Parliament in the first place? In other words, have they been signed off in the normal way?
Thirdly, paragraph 6.1 of the Explanatory Memorandum says that
“if this SI were to fail and the powers were not transferred to the Secretary of State”,
it would not be possible to make regulations to take account of improved scientific techniques in the future. In other words, this is the only way to do that. I take slight issue with that, because surely there remains the option of bringing forward new regulations to take account of improved scientific knowledge, an option that would exist at any time, without necessarily giving all those powers to the Secretary of State. We are being asked to give up our involvement in those decisions. That matters because, as we all know, having debated so many SIs in the past, the definition of improved scientific knowledge is a bit of a movable feast, and we might have a different view in Parliament from the Secretary of State.
The Explanatory Memorandum says that this is to allow more flexibility for the Secretary of State in responding
“to scientific and technical changes”.
But given the Government’s current excitement about the forthcoming Brexit freedoms Bill, how can we be sure that the freedoms for the Secretary of State set out in this SI will not be used to reduce standards in the name of technical advance? For example, there are several references in the SI to the Secretary of State being able to exercise this power only if it is considered
“appropriate to do so as a result of scientific and technical progress”.
This phrase is used in Schedule 6(3) relating to end-of-life vehicles, in Schedule 11(2)(a) relating to mining waste, and in Schedule 20(2) relating to the WEEE directive.
However, there is no definition of scientific and technical progress. Only in Regulation 11(2)(b) does it add the extra provision—the extra safeguard, if you like—that the power should be exercised only
“with a view to achieving a high level of environmental protection.”
Why is not the extra protection of that phrase used in all the other categories: on end-of-life vehicles, the WEEE directive, and so on? I should have thought that that would have given us greater assurance.
Finally, is this a one-off set of measures or is Defra carrying out a wider review of the European Union (Withdrawal) Act 2018, as set out in paragraph 7.6 of the Explanatory Memorandum? Are these new freedoms and flexibility for the Secretary of State now part of a process to review all the withdrawal legislation? I should like an answer to that point, particularly, but also to my other questions. Perhaps if the Minister does not feel able to reply today, he could write to me on those matters. I look forward to his reply.
I thank noble Lords who have contributed to this debate today. Now that we have left the EU, it is essential that our legislation reflects this new reality, and I shall try to address the questions that were put to me. On the first, put to me by the noble Duke, the Duke of Montrose, I simply emphasise that there is and has been very close co-operation between the Government and the devolved Administrations, and between the devolved Administrations themselves. Waste policy is devolved, but the current UK approach on, for example, ELVs, gives no indication so far that the DAs have any intention of diverging. If there are exceptions to that, I shall come back to the noble Lord, but I am unaware of them. It is also the case that some elements are regulated at the UK level—for example, end-of-life vehicles, which therefore applies across the board.
The noble Baroness, Lady Bakewell, asked some quite detailed questions about the percentage of batteries disposed of, where they are exported to, and so on. I shall not be able to answer all her questions, but I shall do my best to answer some of them. As she knows, there are certain labelling requirements for batteries. The powers here would enable exemptions from labelling to be put in place if necessary, but currently there are no exemptions in place. There are numerous portables exported to major EU destinations, including Belgium. However, to provide the noble Baroness with a comprehensive list we need to get data from the Environment Agency, and we will do so on the back of this debate.
The noble Baroness also asked about agricultural waste. The amendments in this SI effectively reinstate the definition of an appropriate authority; that is what it is about. It amends EU 2013/1306, the horizontal or cross-cutting regulations underpinning the CAP schemes, in so far as they relate to the organisation of common markets and rural development measures. Defra previously transferred secondary legislation-making powers in this regulation to the appropriate authority—that is, the Secretary of State and the devolved Administrations. The noble Baroness, Lady Jones, asked the same question. Through the unintended effect of three interacting statutory instruments, the definition of the appropriate authority was deleted, so the amendment will allow the Secretary of State and the devolved Administrations to use these already transferred secondary legislation powers to develop and refine the technical details required to operate rural development schemes and marketing measures. The Scottish Government have told us that they wish to use these powers to make a Covid-related derogation in inspection rates for new Scottish domestic agricultural support schemes early this year.
The noble Baroness, Lady Jones, pressed me in this area and asked whether it was a one-off. I think it is; I would like to say so. I cannot absolutely guarantee that I will not come back with more, but my understanding is that we are done now—this is the end. The error was identified in summer last year, and we have taken steps to make the correction that we are dealing with now at the earliest opportunity. I am reassured that there were no adverse steps that we are aware of. Neither Defra nor the devolved Administrations have sought to use the particular powers that we are legislating for today since we left the European Union, so this has not cost us in any way. It was an error, but the error is being corrected. The human explanation is simply that there has been a flurry of activity since we left the European Union, as the noble Baroness knows as she and I have dealt with much of it. I think it is inevitable that some errors were going to be made.
I know that the noble Baronesses, Lady Jones and Lady Bakewell, asked other questions, but I will have to go through Hansard and find them and give the specific answers they are looking for, rather than waste time now, because I did not catch all the questions while I was going through my papers. In any case, I will need to consult the experts. I hope I have covered at least the most serious questions that have been put to me by Members.
To conclude, I am grateful to noble Lords for both understanding and accepting the need for this instrument. It is small but crucial. The changes it makes to repatriate powers to the UK correct an accidental omission in a previous SI, and it is clearly something that has to be done. This instrument makes it possible to swiftly update many technical standards, criteria, thresholds and conditions in the field of waste management to reflect the latest developments and to ensure that our high environmental standards are maintained. It will also enable our agricultural legislation regarding the organisation of common markets and rural development measures to function as intended. Once again, I thank noble Lords for their contribution and support today.
My Lords, I appreciate that the Minister said he will go through Hansard and perhaps give us a more detailed reply, but I suspect he already knows the answer to the last question I asked him. Partly on the back of the Brexit freedoms Bill, is there a wider review of the powers of the Secretary of State arising from the withdrawal Act, as set out in paragraph 7.6 of the Explanatory Memorandum? Is this a one-off, devolved to the Secretary of State, or are the Government going back and looking at all the provisions in the withdrawal Act? Is that a bigger process that Defra is involved in?
No, it is not. Defra is one of the busiest departments of government at the moment, not least because we have an enormous amount of follow-up to do following the passing of the Environment Act. An enormous amount of secondary legislation and work will follow. One area of the work we are looking at is how we can refine, and potentially improve, the habitats directive. That is also taking up a lot of bandwidth. What we are talking about here today is not the thin end of any kind of wedge. There is no overall Defra review that is happening. In the context of what we are talking about today, I can say that this is a one-off, as opposed to part of an overall review.
Committee adjourned at 5.53 pm.