Considered in Grand Committee
My Lords, the purpose of this instrument is to ensure that the Windsor Framework, in respect of European Union directive 2014/34/EU, known as the ATEX directive, is properly implemented in Northern Ireland, including provisions regarding the UKNI marking.
I believe it would be helpful if I started today by providing some of the background to this instrument. The ATEX directive aims to prevent equipment or protective systems becoming sources of ignition in atmospheres that could be explosive if conditions lead to dangerous levels of flammable gases, mists or dusts. Settings where these conditions could arise include petrol stations and a range of mainly industrial locations such as agricultural silos, and chemical processing plants.
There are separate GB and Northern Ireland regulations covering ATEX requirements. The Northern Ireland ATEX regulations—the Equipment and Protective Systems Intended for Use in Potentially Explosive Atmospheres Regulations (Northern Ireland) Regulations 2017—were made by the Department for the Economy in Northern Ireland. The enforcement authority is the Health and Safety Executive for Northern Ireland, or HSENI. Currently, the Northern Ireland ATEX regulations refer only to the EU market, which no longer includes Northern Ireland. Conformity assessment bodies perform the vital role of assessing that specified requirements relating to a product, process, system, person or body are fulfilled, carrying out calibration, testing, certification and inspection activities.
For the ATEX directive, as for other directives, there is a system of mutual recognition of conformity assessment bodies, meaning that a given EU country recognises the results from a conformity assessment body located in another EU country. This system of mutual recognition does not apply to UK conformity assessment bodies, now outside the EU. To address this, the UK previously legislated for a new UKNI marking to be applied in addition to the CE marking where a good requiring mandatory third-party conformity assessment had been tested against EU requirements by a UK body. The UKNI marking applies when placing such products on the Northern Ireland market.
If it is helpful, I will now explain in more detail how this instrument will achieve its purpose. To address the issues stated, this instrument makes the necessary amendments to ensure that the Northern Ireland ATEX regulations reflect the fact that the UK has left the EU; for example, by ensuring that references to “member states” are replaced with an appropriate term that includes Northern Ireland—but not Great Britain—and the European Economic Area states, as well as by ensuring that information obligations on the UK to inform the Commission and member states apply only to information in respect of Northern Ireland and not the rest of the UK.
The instrument introduces new provisions on the UKNI marking to the Northern Ireland ATEX regulations. In line with the Windsor Framework, if a manufacturer wants to supply an ATEX product for the Northern Ireland market, it will need to manufacture that product to EU requirements. If that product requires third-party conformity assessment under the relevant EU legislation, and if a UK conformity assessment body is used to do that, the manufacturer will be legally required to apply the UKNI indication, which must accompany the CE or other relevant conformity marking.
Failure to comply with this new requirement will be a criminal offence in Northern Ireland. The Northern Ireland Department of Justice has confirmed that the new offence of failure to comply is consistent and proportionate and will not have a detrimental impact on Northern Ireland’s criminal justice system. Enforcement authorities will continue to take a proportionate approach to compliance and enforcement activities, in accordance with the Regulators’ Code.
I will now set out the impact for business of this instrument. The additional UKNI marking requirements may lead to some businesses incurring costs associated with familiarisation with the new requirements and the labelling itself. However, the impacts of these changes are expected to be very limited. My officials in the Office for Product Safety and Standards will be providing online industry guidance to coincide with this instrument coming into force to ensure that businesses have the information they need on how to comply with the new requirements. My officials are also liaising with HSENI and are ensuring that it has all the necessary information to fulfil its role as the enforcement authority.
In summary, this SI is needed to ensure that the Windsor Framework, with respect to the ATEX directive, is properly implemented in Northern Ireland. The instrument does this by amending the Northern Ireland ATEX regulations to reflect that the UK has left the EU and introducing provisions on UKNI marking. I commend it to the Committee.
My Lords, I rise in support of these regulations. I declare two interests. First, I am a member of the Secondary Legislation Scrutiny Committee; it agreed with the regulations but I have certain questions. Secondly, I am a member of your Lordships’ Protocol on Ireland/Northern Ireland Sub-Committee, which now looks at the Windsor Framework. If I may, I will ask the Minister some questions.
As part of our committee’s proceedings, officials asked the department for further information about engagement with a cross-representation of stakeholders. The Government have not undertaken a public consultation. Given this instrument’s specific remit, is that normal or should such consultation have taken place? The department said that, in the absence of a functioning Northern Ireland Executive, it was not able to engage with Northern Ireland Ministers but did maintain strong engagement with Northern Ireland colleagues in the Health and Safety Executive for Northern Ireland, the Department for the Economy and the Department of Justice; no concerns were raised. Can the Minister indicate in his response the format of that engagement? Was it by email, face-to-face consultation or some other means?
Obviously, because of the Windsor Framework there will be an element of divergence in standards. How will that be managed to ensure that there are no conflicts or challenges? Who will monitor that level and degree of divergence and how will it be recorded? Is the Department for Business and Trade undertaking an audit of areas of divergence as a result of the implementation of the Windsor Framework? The noble Lord, Lord Dodds, is also a member of the protocol committee, and that is one area that we have been exploring with the Foreign Secretary. We have been trying to get that list or audit and, as far as I can recall, we have been told simply that it does not exist. It is important that that audit is conducted and updated on an ongoing basis.
From what I can see, the purpose of these regulations is to ensure that they are implemented in accordance with the Windsor Framework. What role will the EU have in relation to that implementation? Will the Department for the Economy in Northern Ireland have a surveillance role and report to the Department for Business and Trade in London to ensure that implementation is in accordance with the Windsor Framework and with proper health and safety standards? As the Minister suggested, the regulations deal with explosives, gas and petrol stations, and the output thereof.
I agree with the regulations, but I have those few questions, to which I would like a response.
My Lords, as the noble Baroness said, I, too, am a member of the committee on the Northern Ireland protocol—or the Windsor Framework, as it is now called, although the two are interchangeable, not just in name but largely in substance. It should be said by way of general comment that this particularly technical statutory instrument deals with an important area but is illustrative of the fact that, under the Windsor Framework, Northern Ireland is subject to EU law, over which no one has given their consent or had a vote or any say at all.
Regarding some of the claims made about the Windsor Framework, it sometimes needs to be remembered that, in Parliament—the other place and here—we look regularly at a whole raft of statutory instruments which implement EU law in Northern Ireland, and the implications for divergence. The noble Baroness, Lady Ritchie, will know that from our experience in the protocol committee. She and others across the board raised the important point about the implications for divergence: the continuing impact over months, years and even decades, if this is allowed to continue, of rules in Northern Ireland which will diverge from the rest of the United Kingdom, either through acts of the European Union, in areas of law which pertain to Northern Ireland under annexe 2 of the protocol, or by actions of the UK Government, now or in future, to a greater or lesser extent, in which they seek to diverge from EU rules. All these will have an impact on Northern Ireland, and in areas where we cannot foresee the outcome. That is why, although people claim that the Windsor Framework is a settlement, it gives rise to future possible areas of dispute.
When our committee at some point ceases its work, there is no evidence thus far that there will be anyone else to pick up that work. People say that the Northern Ireland Assembly will become responsible for it, when it is restored, but there will need to be a massive increase in capacity, skills and personnel to begin to grapple with the massive amount of legislation that is going to come down the track—and for MLAs to get a handle on the sort of issues that are going to arise. I worry about that.
On a couple of specific points, in relation to the lack of an impact assessment, we understand that one has not been prepared because, according to paragraph 13.3 of the Explanatory Memorandum, measures resulting from the framework are out of scope of assessment. Can I have clarification on what that means? Measures resulting from the framework—I presume that is the Windsor Framework—are out of scope of assessment. That seems a rather sweeping statement, but it is there in the Explanatory Memorandum. It seems strange that we should have such a declaration, because my understanding was not that that was the case, but I would be grateful for clarification. Maybe I have misread it or taken it wrong, but it is certainly a concerning statement that is contained in the Explanatory Memorandum.
Another point mentioned in the first paragraph of the Explanatory Notes and in paragraph 7.1 of the Explanatory Memorandum is that the European Union legislation listed in annexe 2 is implemented in Northern Ireland—that is, annexe 2 of the protocol, or the Windsor Framework as it is now called. I would be grateful for clarification, if the Minister can give it—and, if he cannot give it today, I would understand if he writes to me instead—about that statement as well. The Government have told us over and over again that the Windsor Framework removes whole areas of EU law, some 1,700 pages indeed, but the vast bulk of EU law applies to Northern Ireland by virtue of annexe 2, particularly paragraphs 5 to 10.
I would be grateful again for an explanation, although I understand if it is not possible today, but in due course, of that statement as well and its implications in terms of EU legislation. It is stated twice, in the Explanatory Notes and the Explanatory Memorandum and, if these things are meaningful, they have obviously been written deliberately and with consideration.
Sitting suspended for a Division in the House.
My Lords, I thank the Minister for his very detailed explanation of these regulations. I have three questions—or requests for clarification—for him; some aspects have already been covered but I will none the less press ahead with them.
First, paragraph 7.4 of the Explanatory Memorandum states that the Health and Safety Executive Northern Ireland previously had responsibility for
“informing the Commission and other member States … where there are non-conformity products that may be on the EU market”,
but that this responsibility will now be passed to the Secretary of State. Why was this change considered necessary and why is the Secretary of State considered the most appropriate person to carry out that function?
My second question has to a large degree been covered by the noble Baroness, Lady Ritchie. I wanted to ask why there was no public consultation on these measures, not least with the businesses in Northern Ireland that are directly affected by these changes.
The Minister has largely already covered my third question, which is about an information campaign. Given that these regulations will introduce sanctions for non-use or improper use, it is extremely important that businesses affected by this are aware of the new rules. He said that there will be a website, if I heard him correctly. Are there also plans for a more proactive approach to reach out to companies that will be directly affected—companies exporting to Northern Ireland as well as businesses in Northern Ireland that will be directly impacted?
I thank the Minister for the full explanation, which is very much appreciated, and those in the Room for their questions. A few things have been covered that I was going to pick up, and I do not have a great deal more to add. As the noble Baroness, Lady Suttie, mentioned, I was intrigued by the arrangements of the health and safety aspects, particularly the responsibilities for the Secretary of State. I look forward to the answers on that. There are some interesting questions to answer around the consultation. With all these matters, some reassurance is needed on the changes around resources, how they will be managed and, particularly, how they will be monitored. I am sure that the Minister will pick up on the impact assessment in his closing remarks. The only other aspect is around whether there will be any impact on the way that implementation in Great Britain continues and whether this will have any particular impact on that: would there be any digression from the situation arising in Northern Ireland? With those comments, I look forward, with interest, to the Minister’s summing up.
I am extremely grateful to all noble Lords for their participation in the discussion on this statutory instrument. I will try to answer the questions raised in this debate, if I can.
I start with the noble Baroness, Lady Ritchie. I apologised to her in the Division Lobbies for not completely hearing her final question. My commitment here is to focus on the changes relating to these ATEX products, so she will understand if I am quite keen to focus specifically on this regulatory change. I am very aware of the other questions raised around this, particularly relating to the Windsor Framework.
I will cover two points on consultation and, to some extent, impact. We did not undertake a public consultation, given that the instrument’s provisions are limited to making amendments for the implementation of a Windsor Framework obligation and ensuring that Northern Ireland continues to implement EU-derived product safety requirements for ATEX goods. But we did have informal discussions around product sector legislation. As I understand it, these were held with over 4,000 businesses, including manufacturers, trade associations and industry representatives by means of a series of structured interviews. There were further discussions with the Northern Ireland civil servants, the department and the Ministry of Justice. These took place in the form of emails and telephone calls. There was some discussion around the process of this SI and who was effectively responsible for these regulations. That is one of the reasons why they have taken some time to come to noble Lords’ attention.
It is worth looking also at the impact on businesses themselves. We estimate that there are just under 5,500 businesses in the UK subject to ATEX regulations—anywhere between lower and upper bands of 5,000 and 6,000. We think that some businesses may incur costs associated with familiarisation of the new requirements and the labelling, but we believe that the impacts of these changes are expected to be very limited, and the expected net impact of these changes is estimated to be about £2.5 million of direct costs to businesses, most likely relating to familiarisation, among other things.
Officials in the Office for Product Safety & Standards will provide online industry guidance, which I mentioned earlier, to coincide with the instrument coming into force to ensure that businesses have all the information they need on how to comply with the new requirements, but I certainly note the well-made comment of the noble Baroness, Lady Suttie, about the importance of ensuring that the affected businesses are well signalled. Officials are also liaising with the Health and Safety Executive for Northern Ireland, which is responsible for enforcing the Northern Ireland ATEX regulations and ensuring they have all the necessary information on doing so.
Most noble Lords looked at the point of divergence. I know that the noble Lord, Lord Dodds, looked for some clarification on the Windsor Framework. I would be very pleased to write to all noble Lords on their specific questions relating to divergence and the Windsor Framework but, for the purposes of this debate, I hope they will allow me to focus specifically on this instrument.
To conclude, I thank all noble Lords for their consideration of this statutory instrument and their valuable contributions to the debate. They clearly demonstrated broader issues relating to divergence and labelling in the Windsor Framework but, in this instance, I hope that noble Lords will agree that this is a very specialist and necessary piece of safety legislation and that we would want to continue conforming to ensure these products can be supplied.
The instrument is needed to properly implement the Windsor Framework with respect to ATEX products. It achieves this main purpose by amending the Northern Ireland ATEX regulations to reflect the fact that the UK is no longer part of the EU. The instrument introduces provisions on the UKNI marking that will enable UK conformity assessment bodies to assess ATEX products for the Northern Ireland market and show conformity.
I have covered the impact of the changes, which we believe will be low. These changes are being made now, at the earliest opportunity following the agreement between DBT and the Northern Ireland Civil Service in December. The OPSS will take forward the required amendments to the Northern Ireland ATEX regulations. With that, I commend this instrument to the Committee.