Delegated Legislation Committee
Architects Act 1997 (Swiss Qualifications) (amendment) (EU Exit) Regulations 2019
The Committee consisted of the following Members:
Chair: Philip Davies
Black, Mhairi (Paisley and Renfrewshire South) (SNP)
† Blackman-Woods, Dr Roberta (City of Durham) (Lab)
† Burghart, Alex (Brentwood and Ongar) (Con)
† Burt, Alistair (North East Bedfordshire) (Con)
† Creasy, Stella (Walthamstow) (Lab/Co-op)
† Davies, Chris (Brecon and Radnorshire) (Con)
† Dhesi, Mr Tanmanjeet Singh (Slough) (Lab)
† Graham, Luke (Ochil and South Perthshire) (Con)
† Harrison, Trudy (Copeland) (Con)
Killen, Ged (Rutherglen and Hamilton West) (Lab/Co-op)
† Malthouse, Kit (Minister for Housing)
† Morgan, Stephen (Portsmouth South) (Lab)
† Pow, Rebecca (Taunton Deane) (Con)
Turley, Anna (Redcar) (Lab/Co-op)
† Twist, Liz (Blaydon) (Lab)
† Warman, Matt (Boston and Skegness) (Con)
† Wragg, Mr William (Hazel Grove) (Con)
Zoe Grunewald, Committee Clerk
† attended the Committee
Fifth Delegated Legislation Committee
Thursday 9 May 2019
[Philip Davies in the Chair]
Architects Act 1997 (Swiss Qualifications) (Amendment) (EU Exit) Regulations 2019
I beg to move,
That the Committee has considered the Architects Act 1997 (Swiss Qualifications) (Amendment) (EU Exit) Regulations 2019 (S.I., 2019, No. 810).
The regulations were made on 5 April 2019. They are part of the Government’s programme of legislation to ensure that, should the United Kingdom leave the European Union without a deal or implementation period, there continues to be a functioning legislative and regulatory regime.
On 28 March, we—including some of us in this room—amended the Architects Act 1997 to continue to recognise European economic area-qualified architects in a no-deal scenario. This statutory instrument extends those provisions to Swiss-qualified architects. Leaving the EU with a deal remains the Government’s priority—that has not changed—but the responsible thing to do is to make the necessary no-deal preparations, to ensure that the country is prepared for every eventuality.
The regulations are made using powers under the European Union (Withdrawal) Act 2018 to fix legal deficiencies in retained EU law to reflect that the UK will no longer be an EU member state after exit day. The regulations also use powers in the European Communities Act 1972 to implement EU legislation in domestic legislation, which are available only as long as the UK remains a member state.
As stated previously, the architectural sector is a global leader and plays a significant role in the British economy, with an export surplus of £437 million in 2015 and involvement in key global projects such as Vessel in New York and Pulkovo airport in St Petersburg. That is a position that we want to protect and enhance over the coming years by ensuring that UK architect businesses continue to have access to the brightest and best talent available.
I will provide some context and background to the regulations, including a description of our earlier statutory instrument amending the Architects Act in a no-deal scenario. As I explained on 14 March, in the debate on the then draft Architects Act 1997 (Amendment) (EU Exit) Regulations 2019, the mutual recognition of professional qualifications directive enables the recognition of qualifications obtained in other member states. That applies to EEA and Swiss nationals, and includes the recognition of suitably qualified architects. The arrangement is reciprocal, allowing UK and other EEA or Swiss nationals the opportunity easily to register to practise across Europe and Switzerland, and allows UK practices to recruit the best European and Swiss talent.
The Architects Act 1997 sets out the specific procedures for registering as an architect in the UK. The registration of EEA and Swiss architects is carried out by the competent authority, the Architects Registration Board, which is an arm’s length body of my Department. There are three routes to recognition for EEA or Swiss architects wishing to register in this country. Their main route to recognition in the UK is through an automatic recognition system. To qualify for automatic recognition, an EEA or Swiss national needs to meet three tests: an approved qualification, which means one listed in annex V to the mutual recognition of professional qualifications directive; access to the profession of architect in an EEA member state or Switzerland; and a statement from their home competent authority to confirm that they are fit to practise.
A second route, known as “general systems”, provides for recognition for EEA and Swiss nationals who do not have an approved qualification. The applicant is offered compensation measures—that is, the opportunity to undertake additional training to make up any differences in qualification. It is a long and costly process, which on average only four people pursue annually. The third route facilitates the temporary or occasional provision of service. It allows EEA or Swiss professionals to work in the UK in a regulated profession on a temporary basis, while remaining established in their home state. Typically, fewer than 20 EEA or Swiss architects pursue that option at any one time.
If the UK leaves the EU without a deal, the mutual recognition of professional qualifications directive will no longer apply in the UK. The 2019 regulations made on 28 March ensure that UK architectural practices will continue to be able to recruit the best European talent and maintain their global reputation as world leaders in the field of architecture by preserving the main route to recognition.
The mutual recognition of professional qualifications directive was extended by what is commonly referred to as the agreement on the free movement of persons between the EU member states and Switzerland, which allowed Swiss nationals to benefit from the recognition routes described. Due to the requirement of the European Communities Act powers, which exist only as long as the UK is a member state, to include Swiss qualifications, we assessed that there was a substantial risk that all EEA-qualified architects who wish to register in the UK would be without legislative cover if the 2019 regulations were not made before 29 March. However, the extension to exit day has allowed us extra time to lay legislation to provide parity between EEA and Swiss-qualified architects, as currently exists, in a no-deal scenario.
I thank the Minister for highlighting the various qualifications and regulations with regard to the Architects Act. Can he confirm whether there will be any watering down of the regulations in place between the UK and the EU post Brexit?
I am coming to that. If the hon. Gentleman will bear with me, I will explain the effect of the instrument.
The policy intention is to provide the sector with confidence that almost all applicants can register in the same way after exit day as they do currently. That is the approach favoured by the sector, which recognises that the skills brought by EEA and Swiss architects contribute positively to the UK’s reputation as a world leader in architecture. The approach of continued recognition also received support in the debates on the 2019 regulations.
The instrument allows applications made before exit day to be concluded under the current system as far as possible. For future applications, it will freeze the list of approved qualifications in the EU’s mutual recognition of professional qualifications directive. As a result, after EU exit, in a no-deal scenario, an individual holding an approved EEA or Swiss qualification will be able to join the UK register of architects if they have access to the profession of architect in their home state. Through the legislation, that process will be open to anyone with a Swiss qualification and access to the profession in Switzerland, regardless of citizenship.
We will, however, remove general systems as a route to registration, as that is a long and costly process that is not often utilised. It places a significant and unnecessary burden on individuals and the Architects Registration Board. Therefore, applicants without an approved qualification will be able to register via the route currently utilised by third-country nationals.
The instrument does not change any part of the 2019 regulations, but simply extends the provisions to include Swiss qualifications. Although the number of Swiss architects registering in the UK is low—77 in the last 10 years—and accounts for less than 1% of the total recognition decisions via that route, we felt that it was imperative to preserve the rights that Swiss-qualified architects enjoy and provide parity between EEA and Swiss-qualified architects.
The regulations, alongside those made on 28 March, serve a specific purpose to prioritise stability and certainty if the UK leaves the EU without a deal or an implementation period by ensuring that EEA and Swiss-qualified architects can continue to register and practise in the UK. The regulations ensure that the UK will continue to have access to Swiss talent after we have left the EU, thereby helping to maintain the UK’s reputation as a global leader in architectural services. Thereafter, they provide a stable basis for Parliament to change the law, where it is in the UK’s best interest to do so.
To conclude, the instrument is necessary to ensure that the Architects Act continues to function appropriately if the UK leaves the EU without a deal or an implementation period. I hope that hon. Members will join me in supporting the regulations, which I commend to the Committee.
It is a pleasure to serve under your chairmanship, Mr Davies. I thank the Minister for outlining what the statutory instrument contains. It is clear that it follows on from the SI that was made on 28 March and relates to a relatively small subset of that larger group of European architects that that SI referred to. On that basis, I will keep my remarks short, but I want to ensure that we have a complete understanding of what the Government seek to do.
Architects are one of the seven sectoral professions that benefit from automatic recognition under the current system, so if an EU, EEA or Swiss citizen meets the minimum harmonised standards, as set out in the directive, they are eligible to register and practise in the UK as an architect. The Architects Registration Board is responsible for the registration of all architects in the UK.
When, or if, we leave the EU, the directive will no longer apply. The SI ensures that the existing process for recognising EU and EEA-qualified applicants seeking to register as architects in the UK will operate effectively should we leave without a deal.
The Minister is nodding, so I assume that I have got that right. The current process will be frozen immediately before exit day, hence the need to plan ahead. The reason that Swiss architects were not considered last time is that neither the 2019 regulations nor the 1997 Act referred to the Swiss agreement. Is that correct?
Good—we can make progress. It is a pity that we have to put time in to preparing for a no-deal exit that the Government could clearly have taken off the table much earlier. Nevertheless, we are where we are and I prefer to focus my comments on the importance of supporting the architectural profession in the UK and ensuring that, post Brexit, it is able to draw on the expertise and creativity of architects right across Europe, including in Switzerland. That is especially important as the sector contributes about £4 billion—perhaps considerably more, even £5 billion—to the economy, and grows in importance all the time.
We need to maintain our position as a major global player in architecture. That has been recognised by the Royal Institute of British Architects, which has been clear that the sector is calling for access to the best talent and skills and common standards and compliance costs post Brexit. RIBA has made it clear that the architectural scene could be stricken by a shortage of talent should Brexit mean that free movement comes to an end and no mutual recognition of professional qualifications agreement is in place. Will the Minister comment on that? At the moment, it is not entirely clear that there will be an MRPQ agreement or that the Government are working on that.
I know from what the Minister said in a previous Delegated Legislation Committee that he is aware of the importance of the sector. Hansard notes that he recognised the sector’s exports surplus in particular, which was £437 million in 2015. As we recognise the importance of the sector, we need to ask a few questions. Such SIs put temporary solutions in place, but what additional resources can the Minister give to ensure that the long-term issue of registration and recognition of Swiss architects will be resolved?
I have asked the Minister about reciprocal agreements before but, in the light of this SI, I need to ask again. What reciprocal agreements have been put in place and are the Government working on them? The sector says that they are hugely important: 74% of architects believe that access to the EU is necessary and that without it, the industry’s future growth could be stymied. Sixty per cent. of architects surveyed by RIBA said that they have considered leaving Britain because of Brexit, which is 20% more than when the survey was first carried out in 2016. Brexit has already had an impact on the revenue stream of 68% of architects, and 43% of practices have had projects cancelled. We must ensure that no further damage is inflicted on the sector, and everybody seems to say that work on a detailed and inclusive MRPQ must happen as soon as possible.
Has the Minister made an estimate of the cost to businesses or architects’ practices of putting this new system in place? Also, what exactly will happen to the ARB after Brexit? Will it be given additional resources, or will the Government meet it to ensure that it is able to deal with this situation post Brexit?
In the last SI Committee related to the 1997 Act, questions were put to the Minister on how, if this does not work and there is not an MRPQ that everybody signs up to, we may end up in a situation where architects wishing to come and work in this country from across Europe, including Switzerland, will have to apply through the tier 2 visa process. The Minister did not answer questions about whether they will have to take that route or whether the Government will develop another route for them. Obviously, as this is a concern to the sector, I am very keen that he comments on that.
Clearly this SI is a tidying-up exercise. We do not wish to vote against it, because we want to support the architectural profession and ensure that, if UK architects want to employ architects from Switzerland, they are able to. However, I will be grateful if the Minister addresses the questions that have been raised.
I thank the hon. Member for City of Durham for her constructive approach. She is quite right that this is a temporary fix for a situation in which mutual recognition falls away as part of our exit from the EU. We are committed to trying to find a permanent solution. We are jointly holding fruitful and ongoing conversations about mutual recognition with the Department for Business, Energy and Industrial Strategy and our professional partners across the world.
Obviously, as we move into a post-EU world, that work will accelerate, not least because it is in our interest, particularly for this sector. Our architects are world renowned and famed across the globe for their expertise, ingenuity and innovation. I think a British architect designed the new airport in Hong Kong. We are, of course, famous for our bridges; we build lots of them around the world. This is a great export industry that we wish to encourage, as well as being part of our armoury, if you like, of soft power around the world. We build the great buildings and edifices, from the Bundestag in Germany right through to that airport in Hong Kong. We are keen to support the industry.
Part of the reason for this SI was to maintain standards. By freezing the recognition of qualifications at the point of exit, we provide ourselves with a period of security in which we can be clear that those people coming in to practise architecture in this country do so on a stable basis. However, it is of course the job of the ARB to continually review qualifications from around the world to make sure that they are up to standard, because it has a general duty to ensure that anybody practising architecture in this country does so correctly and to the right standard.
As we discussed in the last SI Committee to deal with the subject, we believe that the cost of this is minimal. Fundamentally, this SI achieves the same thing by a slightly different route. It gives powers to the ARB to require information to be provided in different ways from how it is currently provided. Given that the general route towards qualification to practise in this country is being removed—as I said, that places a burden on the ARB as well as individuals—there may well be a reduction in overall costs through the removal of that rather cumbersome route to qualify.
As the hon. Lady says, this is essentially a tidying-up exercise for a very small number of architects; we are talking about an average of something like seven people registering a year. We felt it was better to be belt and braces than to leave it loose, not least because one of our greatest or most acclaimed architects, Norman Foster, is resident in Switzerland and may wish to move backwards and forwards. That is not to say that we are legislating specifically for him; we are also legislating for the many young, exciting and interesting architects from this country and Switzerland who may decide to practise in the other country. On that note, I thank the Committee for listening carefully to the information that has been provided, and I hope it will support the regulations.
Question put and agreed to.
Value Added Tax (Tour Operators) (amendment) (EU exit) Regulations 2019
The Committee consisted of the following Members:
Chair: Sir Henry Bellingham
† Bruce, Fiona (Congleton) (Con)
Champion, Sarah (Rotherham) (Lab)
† Day, Martyn (Linlithgow and East Falkirk) (SNP)
† Dodds, Anneliese (Oxford East) (Lab/Co-op)
† Grogan, John (Keighley) (Lab)
† Hands, Greg (Chelsea and Fulham) (Con)
† Heaton-Harris, Chris (Daventry) (Con)
† Lewer, Andrew (Northampton South) (Con)
† Merriman, Huw (Bexhill and Battle) (Con)
† Milling, Amanda (Cannock Chase) (Con)
Pearce, Teresa (Erith and Thamesmead) (Lab)
† Pursglove, Tom (Corby) (Con)
† Sheerman, Mr Barry (Huddersfield) (Lab/Co-op)
† Smith, Jeff (Manchester, Withington) (Lab)
† Stride, Mel (Financial Secretary to the Treasury)
† Warburton, David (Somerton and Frome) (Con)
Williams, Dr Paul (Stockton South) (Lab)
Kevin Candy, Committee Clerk
† attended the Committee
Sixth Delegated Legislation Committee
Thursday 9 May 2019
[Sir Henry Bellingham in the Chair]
Value Added Tax (Tour Operators) (Amendment) (EU Exit) Regulations 2019
I beg to move,
That the Committee has considered the Value Added Tax (Tour Operators) (Amendment) (EU Exit) Regulations 2019 (S.I., 2019, No. 73).
It is nice to see that we are all here present and correct, Sir Henry, and under your chairmanship. The instrument allows changes to the VAT treatment of the suppliers of designated travel services made by UK tour operators that are enjoyed in an EU member state. By “designated travel services” we mean holidays in which, for example, hotel accommodation, car hire, flights and so forth are included.
The instrument will come into effect only after the laying of an appointed day order, which will occur only in the unlikely event that the UK leaves the EU without a deal. As the Committee will know, the Government remain focused on ensuring our smooth and orderly withdrawal from the EU with a deal as soon as possible. However, the current agreement with the EU is that the UK will leave no later than 31 October, and as a responsible Government we have been preparing for all potential outcomes, including the unlikely scenario in which no mutually satisfactory agreement can be reached.
The tour operators’ margin scheme, also known as TOMS, is an EU simplification scheme that treats a series of designated travel services—let us call them holidays—as a single supply, and determines that the place of supply is where the tour operator is established, not where the holidays are enjoyed. A benefit of TOMS is that tour operators need only account for VAT on the difference between the value of the sales and the costs for the services, which is commonly known as the margin. An additional benefit of the current system is that tour operators need to register an account for VAT only in the member state where they are established, regardless of where in the European Union the holidays take place.
In common with other areas of VAT, in the unlikely event of a no-deal exit from the EU, the Government are seeking to retain the VAT treatment of goods and services as close to the existing rules as possible. For UK tour operators, that means implementing a UK version of TOMS that retains some of the VAT benefits while treating holidays in the EU in the same way as those enjoyed in the rest of the world. That means that the VAT rate on EU holidays will be zero, rather than 20% as now. That requires an amendment to group 8 of schedule 8 of the Value Added Tax Act 1994, to extend the VAT rate of 0% to designated travel services enjoyed in EU member states, as well as to those in the rest of the world. There would be no change to the VAT treatment of designated travel services currently enjoyed in the United Kingdom.
It is worth noting that UK tour operators may be required to register in each member state where they supply designated travel services that are to be enjoyed in the member state in question. However, Her Majesty’s Revenue and Customs is not aware of any member state that requires non-EU tour operators to register for VAT. While there is no reason to believe that this will change, in the event that the UK leaves without a deal, it cannot be guaranteed. The instrument therefore removes the risk of UK tour operators being subject to double taxation.
This instrument also makes changes to the Value Added Tax (Tour Operators) Order 1987, replacing references to “the EU” with “the UK”. That ensures that the place of supply of those services remains the United Kingdom, and that the place of establishment of the tour operator is in the UK.
In summary, in the unlikely event that the UK leaves the EU without a deal, these changes will keep the VAT processes as close as possible to the present regime, and ensure that UK tour operators will not be subject to double taxation. Those changes treat suppliers of designated travel services enjoyed in the EU in the same way as those enjoyed in the rest of the world, and maintains the present VAT treatment of designated travel services enjoyed in the UK. I commend the instrument to the Committee.
It is a pleasure to serve on this Committee with you in the Chair, Sir Henry, and I am grateful to the Minister for that explanation. Of course, this statutory instrument is one of a series that is intended to prepare the country for the event of a no-deal Brexit. The Committee will be aware that the Opposition have repeatedly voiced our concern about this process, in particular the fact that, in our opinion, very often the precise impacts of these measures have not been sufficiently spelled out. That is a point I will return to in a moment in relation to this SI. In addition, we are concerned that the process has not facilitated the accountability necessary for potentially significant changes to rules around tax and many other financial and economic issues.
Having said that, we agree with the premise of these specific regulations, which is to prevent the double taxation of travel companies or tour companies in the event of a no-deal Brexit—something that we have long argued the Government should have ruled out from the very beginning. However, these regulations do not deal with the significant uncertainty, and especially the additional cost, that companies would face in relation to their tax liabilities abroad if there was a change to the current VAT process, especially if they suddenly had to register separately for VAT in every EU country in which they operate.
I think this is a matter of omission by the Government, rather than commission. My concern is that the Government have not spelled out how they would help those companies and what they would do specifically to deal with the bureaucratic obstacles that would arise in what may currently seem an unlikely eventuality, although I think it is perhaps more likely than the Government appear to believe.
As the Minister explained, the current system of VAT for tour operators treats the place of supply for VAT purposes as the UK, irrespective of where their travel service is employed. Therefore, VAT currently stands at 20% across the board for outbound tourist services. Under the new system, as I understand it, the amount of VAT due would differ depending on the country the service was provided in, if those different EU27 countries decided they wanted to levy it; I appreciate that they might not, but equally they might decide to do so.
The rate due in that eventuality would vary depending on the country, with the burden of operating in, say, Scandinavian countries such as Norway or Sweden increasing due to their higher VAT rate of 25%. It would also potentially become very complicated; as we know, in some countries such as Germany there are different VAT rates for different aspects of tourism-related activities. In the hotel sector, for example, VAT is 7%, compared with restaurants where it is 19%.
The Government’s impact assessment insisted that the impact of this regulation was negligible, but I understand from the representations made to me by industry that the changes could be felt in significant ways by outbound tourist companies. If it was necessary to have multiple VAT registrations, it would place a significant financial burden on tour companies, particularly small and medium-sized enterprises. Those tour operators would need to understand the operation of VAT in all those other countries in which they operate within the EU and how each VAT system could affect their business. That could place a considerable burden on tour operators and many would need to pay for local advice.
There is also the fact that different types of digital tax systems have been introduced in different EU states. Under these proposals, tour operators may need to have systems capable of compliance with multiple different versions of digital tax accounting. For example, I understand that the digital tax system in Spain—the biggest destination for UK holidaymakers—has been described as particularly complicated and likely to lead to high compliance costs for British businesses.
Those new costs would have to be absorbed by those companies, potentially at the same time as they had to comply with making tax digital for the first time, given the Government’s timetable on MTD. In fact, it has been suggested that the typical cost of basic local compliance in each EU member state could amount to between €8,000 and €15,000 per VAT-registered entity per annum. That is a pretty big burden. If we look at the outbound tourist industry, according to the Association of British Travel Agents, 90.7% of companies in the industry employ fewer than 10 people and a further 8% employ fewer than 50. They are not gigantic organisations that can have whole sets of staff dealing with VAT; that is just not on the cards for them at all.
As a first question, can the Minister explain clearly to this Committee what his Government would do to support small and medium-sized enterprises through this transition, if necessary? I must say that I find the impact assessment quite peculiar in its claim that there would be a minimal impact on business, because that surely would not be the case if they suddenly had to comply with all those different systems.
This is very evocative for me of what happened with the situation for VAT on digital services. I am sure that Committee members remember that the EU introduced a lower threshold for the payment of VAT on digital services, and changed the locus of payment from the location of the seller—that is effectively the same approach as that of these regulations—to the location of the consumer. It also introduced the VAT mini one-stop shop—I am sure hon. Members remember VATMOSS. The VATMOSS system calculated the VAT that was payable for businesses without their having to do that work, but even with VATMOSS lots of businesses found it very difficult to comply with the new system. There does not appear to be anything equivalent even to VATMOSS in the regulations for tour operators if they suddenly have to start paying all that VAT in EU27 countries. My second question is, have the Government made any attempt to encourage the EU27 to consider creating a one-stop shop if these regulations are acted upon?
There is also the matter of the impact of these new rules on revenue to the Exchequer. Studies have shown that TOMS VAT equates to about 1.08% of tour operating turnover. ABTA estimates that its members paid in the region of £300 million in TOMS VAT last year. Thirdly, I hope the Minister will be able to outline what measures the Government intend to adopt to avoid the loss of revenue that looks set to arise from this approach if it is acted upon.
It is important, as we head into economically uncertain times, that the Government do all they can to support the tourism sector, particularly given that the UK has one of the most developed outbound travel markets in the world. I want to pause a little to consider the Minister’s claim that it is very unlikely that we will see change here because third-country regimes are not being invoked at the moment and because EU27 countries currently do not charge VAT to third-country operators. The UK is in a different situation because of the number of trips organised by UK-based tour operators for people from outside the EU which begin in the UK and follow a so-called grand tour of Europe. That is very important for many of our tour operators.
The overall industry of outbound tourism is worth more than £11.7 billion a year to the UK economy, and in excess of £28.3 billion a year by the time aggregate impacts are taken into account. Those tourists sometimes start their trip in Paris or Berlin, but I estimate that quite a large proportion of them start in the UK. Therefore, the incentives are stronger for the EU27 to look into changing this regime, particularly if they think that there could be a positive revenue impact on them or that there is the opportunity to persuade those tourists to start their trips within their jurisdiction, rather than the UK, or to prevent tours from being run by a UK tour operator.
This is all occurring at a time when the tourism industry is facing difficulties. We have all heard about what has been happening with Thomas Cook. There is growing uncertainty, and it is creating an increasingly difficult environment for the tourism and hospitality sectors to operate in. It is also affecting consumers, who have been warned by travel companies that they will not be compensated if a no-deal Brexit causes travel chaos.
I am sorry I was late, Sir Henry. It is Europe day, and I was asking a question in business questions about celebrating our membership of the European Union. Does my hon. Friend agree that working people in the travel and tourism industry in our country, which is very important, are extremely worried about their jobs and their future? This statutory instrument is very important indeed to their lives.
I could not agree more. That is absolutely the case. To an extent, I have an interest in this sector, as some of my family members have been involved in it. It is often a route for social mobility, because small, innovative firms can develop a specific offer and, as a result, grow, innovate and create new jobs. It is a dynamic part of the UK economy. We need more information—I hope that the Minister can provide some—about how the Government will try to protect and nurture those firms, given the potential impact of the additional administrative and perhaps financial burden if these measures are required.
It is a pleasure to serve under your chairmanship, Sir Henry. I am grateful for the Minister’s summation and I find myself much in agreement with what the Opposition spokesperson has already said. I would add that I find it absolutely disgraceful that the UK Government are still planning for a no-deal scenario, which in my opinion should have been ruled out far earlier than now. I am also concerned about the risk of multiple VAT registrations that may be required at some point in the future, and deeply concerned about the impact that could have on businesses.
I am grateful to the hon. Member for Oxford East for her usual thorough interrogation of the issues at hand.
Yes, she’s good, she is.
The hon. Lady’s colleague says she is very good, and I concur entirely with that sentiment.
I am pleased that the hon. Lady agrees with the premise of what we are attempting to achieve here. She recognised the importance of avoiding potential changes in the unlikely event of a no-deal Brexit, in terms of double taxation. She specifically raised the issue of what would happen, and she set out in great detail what might happen, in the event that we were to leave the European Union and the EU were to then change its relationship in respect of this particular element of the VAT regime and what the impact of that might be on the UK business sector. I would like to make a few brief points on that.
The first point to make is that there is no suggestion at this stage from HMRC or ourselves that that is a likely outcome, in terms of the discussions that we have had with the European Union on our exit. It would introduce a great additional complication on both sides were the EU27 to decide to move in that direction.
The second point I would raise is one that the hon. Lady raised. Under the EU’s current regime, no third countries are treated as having to register for VAT within any of the EU28 member states with which they may be conducting business.
Thirdly, when we look at VAT, where holidays or trips are sold from the UK into the EU27, VAT is generated as a consequence of those trips and the hotel bookings and so on, so the EU and member states are collecting VAT in that way. As the hon. Lady will recognise, the context of this debate is the margin on which the VAT is being accrued.
Finally, if we were to end up in a no-deal situation, which I think unlikely, and the EU were to decide that our businesses had to register separately within the EU27, it would have to think long and hard about the consequences and what we might do in response to that. I do not think it would be in either party’s interest to change from the current status quo.
The hon. Lady also pointed out that the impact assessment foresees limited or effectively no impact on businesses. Of course, that excludes the scenario on which she dwelt at great length in her speech, and rightly so, as I have set out why we think that is highly unlikely. She asked what support we would provide to business in the event that there was a changed response from the EU27. Were we to get into that kind of territory, we would know some time in advance, and would take decisions at that moment in time.
She also asked whether we had encouraged the EU to look at alternative arrangements. I am fairly confident in saying that we have not engaged in those specific discussions with the EU on the basis that we think that it is extremely unlikely, but were it to appear to become more likely, then of course we would look at all those particular avenues. She asked a specific question about what the loss of VAT revenue might be as a consequence of complying with WTO rules and applying the zero VAT rate to those transactions between ourselves and the EU27, in the unlikely event of a no-deal Brexit. I am very happy to write to her to give as accurate an answer as I can.
I thank the hon. Member for Linlithgow and East Falkirk (Martyn Day) for his comments. I think he said it was disgraceful that we are still planning for a no-deal Brexit, but that is something that we passionately do not want, which is why we are working so hard to try to deliver a deal. However, we must recognise the fact that ultimately a no-deal might be outside of our control. It is to some degree within the gift of the European Union. As a responsible Government, we must make sure we cover that remote possibility. On that basis, I hope the Committee will support the instrument.
Question put and agreed to.
Animal Health, Plant Health, Seeds and Seed Potatoes (Amendment) (EU Exit) Regulations 2019 Animal Health, Alien Species in Aquaculture and Invasive Non-native Species (Amendment) (EU Exit) Regulations 2019
The Committee consisted of the following Members:
Chair: Joan Ryan
† Aldous, Peter (Waveney) (Con)
Clwyd, Ann (Cynon Valley) (Lab)
† Debbonaire, Thangam (Bristol West) (Lab)
Doughty, Stephen (Cardiff South and Penarth) (Lab/Co-op)
Ellman, Dame Louise (Liverpool, Riverside) (Lab/Co-op)
† Huddleston, Nigel (Mid Worcestershire) (Con)
† Kerr, Stephen (Stirling) (Con)
† McCarthy, Kerry (Bristol East) (Lab)
† Maclean, Rachel (Redditch) (Con)
† Mc Nally, John (Falkirk) (SNP)
† Martin, Sandy (Ipswich) (Lab)
† Pollard, Luke (Plymouth, Sutton and Devonport) (Lab/Co-op)
† Rutley, David (Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs)
† Sandbach, Antoinette (Eddisbury) (Con)
† Seely, Mr Bob (Isle of Wight) (Con)
† Stewart, Iain (Milton Keynes South) (Con)
† Tracey, Craig (North Warwickshire) (Con)
Sarah Rees, Committee Clerk
† attended the Committee
Seventh Delegated Legislation Committee
Thursday 9 May 2019
[Joan Ryan in the Chair]
Animal Health, Plant Health, Seeds and Seed Potatoes (Amendment) (EU Exit) Regulations 2019
I beg to move,
That the Committee has considered the Animal Health, Plant Health, Seeds and Seed Potatoes (Amendment) (EU Exit) Regulations 2019 (S.I. 2019, No. 809).
With this it will be convenient to consider the Animal Health, Alien Species in Aquaculture and Invasive Non-native Species (Amendment) (EU Exit) Regulations 2019 (S.I. 2019, No. 813).
At the end of the debate, I will put the question on the first motion, and then ask the Minister to move the remaining motion formally.
It is a pleasure to serve with you in the Chair, Ms Ryan. Thank you for clarifying the situation. I thank hon. Members on both sides of the Committee for their participation at such short notice. Both statutory instruments were made under the urgency procedure, as they were required to support the UK’s application to the EU Commission for third country listed status for exports of animals and animal products. The Government have made it clear that we seek to negotiate a deal with the EU, but we are also taking responsible action to prepare for other eventualities. The UK’s third country listing application was a particularly important part of our no-deal preparations, as third country listed status would have guaranteed that the export of animal products and most live animals from the UK to the EU could have continued, had we left the EU without a deal on 12 April.
The EU called a meeting of the standing committee on plants, animals, food and feed on 9 April to consider the UK’s third country listing application, which covered most live animals and animal products. It was made clear that all relevant animal health legislation was to be in place by that date. Both SIs therefore had to be made in a short window of time, as both contained amendments to animal health legislation. They were laid before Parliament on 4 April and made using the urgency procedure, so the UK was able to assure the EU that all relevant legislation had been made, enabling member states to vote unanimously on 9 April to list the UK as a third country in the event of a no-deal scenario on 12 April. That was a positive outcome.
The Government have taken care to avoid using the urgency procedure under the European Union (Withdrawal) Act 2018, but we considered its use appropriate in these instances. Our biosecurity controls for animals and plants are paramount, and these instruments contribute towards ensuring that we will have the most robust arrangements in place to protect public health and the environment when the UK leaves the EU. These instruments make technical operability changes covering animal health, plant health, agriculture, invasive non-native species, seed marketing and seed potatoes, and they will ensure that the legislation that protects our biosecurity is fully operable.
The first set of regulations cover animal health, plant health, seed marketing and seed potatoes. They primarily make technical amendments to ensure that recent EU decisions will be operable on exit day. Regulation 2 implements recent updates on animal health control measures relating to African swine fever in certain member states. It relates to Commission implementing decision 2014/709, and requires the appropriate Minister in the UK to display public information notices regarding the importance of biosecurity measures to prevent this pig disease from being brought into the UK. It also prohibits the movement of live feral pigs.
Regulation 3 amends retained EU law to ensure that transmissible spongiform encephalopathies functions operate correctly, by replacing a reference to production and manufacturing processes being approved by the EU Commission to those approved by the Secretary of State. That was omitted from a previous EU exit SI.
Part 3 of the SI covers plant health. It amends the Plant Health (Amendment) (England) (EU Exit) Regulations 2019 and the Plant Health (EU Exit) Regulations 2019 to recognise arrangements with the Crown dependencies and deal with new EU plant health decisions, such as controls on the red-necked longhorn beetle, preventing its introduction and spread.
Regulations 4 and 5 give effect to the arrangements with the Crown dependencies, following planned meetings that were concluded early in 2019, that will continue to facilitate the import and movement of regulated plants and plant products into the UK from Jersey, Guernsey and the Isle of Man. Agreement came late in those negotiations, and the provision could not be put into a previous SI, passed back in December. Regulation 5 also provides for the import of ash wood from the USA and Canada to continue under the same stringent derogation provisions after exit, ensuring continuity of supply for UK businesses without compromising biosecurity. That follows a recent EU decision.
The Plant Health (Amendment) (England) (EU Exit) Regulations 2019 are also being amended to enable UK plant passports to contain certain details relating to the marketing of fruit plant propagating material and fruit plants, to avoid the need for dual labelling.
Part 4 of the first statutory instrument covers marketing of seed potatoes and vegetable seed. It applies to England, as this is a devolved matter. Regulations are being amended to ensure that growers in England have continued access to new varieties of vegetables and a continued supply of seed potatoes after EU exit. These provisions are needed to ensure continued access to seed potatoes of relevant varieties during the one-year interim period. I am sure that we will speak more about that in the course of these proceedings.
With your permission, Ms Ryan, I turn to the Animal Health, Alien Species in Aquaculture and Invasive Non-native Species (Amendment) (EU Exit) Regulations 2019. This instrument amends four previously made EU exit SIs, to ensure that the previous instruments work fully as intended. The instruments being amended are the Invasive Non-native Species (Amendment etc.) (EU Exit) Regulations 2019, the Aquatic Animal Health and Alien Species in Aquaculture (Amendment etc.) (EU Exit) Regulations 2019, the Aquatic Animal Health and Alien Species in Aquaculture (Amendment) (England and Wales) (EU Exit) Regulations 2019 and the Import of and Trade in Animals and Animal Products (Amendment etc.) (EU Exit) Regulations 2019.
The invasive species instrument is being amended to correct a small number of drafting and typographical errors. An amendment has been made to regulation 7(3)(e) of the invasive species instrument, to ensure consistency with the Invasive Alien Species (Enforcement and Permitting) Order 2019. The order provides for recovery of enforcement-related costs from importers by enforcement authorities. This amendment provides certainty that importers are responsible for those costs.
The aquatic instruments previously contained minor errors, for which I apologise. They have been corrected by this instrument.
The instrument relating to animal imports is being amended to reinstate the 2006 Commission decision, which was revoked in error. That decision imposes the import requirements for fruit bats, cats and dogs from Peninsular Malaysia and Australia. I should say to hon. Members that the UK does not import any fruit bats, but a number of cats and dogs are imported from those countries, so it is clearly imperative that the issue be rectified. We have absolutely no intention of weakening biosecurity standards.
The lists of animal product commodities subject to checks at UK border inspection posts were intended by the Department to be published outside the EU retained legislation, for ease of later amendment. However, those were not removed as intended from the appropriate 2007 Commission decision. This instrument will now take the lists out, so that they can be more readily updated in response to future circumstances.
The final change of note is the removal of earlier amendments to a 2014 Commission implementing regulation, because it has been determined that the whole regulation is not required as EU retained law. It relates to a health certificate for wild game carcases, including gazelles, that has not been used for 10 years. The regulation has already been revoked in another EU exit SI from another Department, so we are removing our amendments, as they are no longer required. The animal imports instrument additionally makes a small number of further very minor corrections.
I emphasise that this corrective instrument makes purely technical changes to the four EU exit instruments, to ensure that they will operate correctly when we leave the EU. This instrument does not introduce new policy. It simply amends the original instruments, so that they operate as originally intended.
The decision to use the urgency procedure was not taken lightly; its use was deemed necessary to protect the biosecurity of the UK, to prevent financial losses, and to maintain trade by ensuring that the UK could achieve EU third country listed status, in the event of our leaving the EU without a deal on 12 April. The regulations will ensure that our strict biosecurity controls with regard to animal health, plant health, agriculture, invasive non-native species, seed marketing and seed potatoes are maintained when we leave the European Union. For the reasons I have set out, I commend the statutory instruments to the Committee.
I intend to speak to SI 2019, No. 809; my hon. Friend the Member for Plymouth, Sutton and Devonport will speak to the other SI.
I believe that the Minister told us that the measures in today’s SIs were intended to have been covered in previous ones. Perhaps he can confirm that. It can surely never have been the plan to deal with African swine fever and seed potatoes in the same SI. I also assume that the reference to the EU Commission in relation to the production and manufacturing processes in transmissible spongiform encephalopathies is simply an omission that was not picked up by a previous SI.
Is all that confusion not indicative of other possible omissions, one or two of which may turn out to be seriously damaging? Was there ever any serious possibility that the Crown dependencies would not want to be covered by the regulations? The explanatory memorandum states that it was agreed that they would be covered
“Following recent discussions”—
well, they were recent in February—
“with the Crown Dependencies”.
Perhaps the Minister will enlighten us as to whether the discussions started with, “After careful consideration, would you like to change your mind and be included in the UK regulations?”. Or was it more a case of, “Oh dear, we seem to have left you out of the regulations. We can put that right with a catch-all mopping up SI, but we need your consent”?
We are here to make amendments to amendments because the previous amendments fell short of what was needed. On aromia bungii, the EU regulations were changed in October. The SI was originally laid before Parliament on 12 February, but we could all be forgiven for having lost track, because it has been scheduled and pulled so many times, with or without minor amendments, and with or without the added complication of there being completely different SIs with the same title that dealt with Northern Ireland.
The Plant Health (EU Exit) Regulations 2019 were passed on 19 March. Will the Minister explain why they did not include the changes necessary to cover the new EU regulation in this area, given that SI 2019, No. 809, which was originally laid before Parliament on 12 February, mentioned things that were not in the regulations passed on 19 March? Why was no mention made of the fact that further changes needed to be made when we debated this on 19 March?
This all sounds minor and pettifogging, but if infestations of aromia bungii, also known as red-necked longhorn beetles, were to spread unchecked, that would have a serious effect on our fruit growers. Hopefully, the further amendment before us today will help to prevent its spread, but are there other pests for which preventive regulations have inadvertently not been accurately amended, and how can we tell? Ms Ryan, you would be forgiven for believing that we had passed the SI already. Can the Government be sure that they have, at last, got it right?
We have concerns about the changes proposed in the SI. In line with the series of concerns raised by the House of Lords Committee, will the Minister tell us whether the need to facilitate trade post Brexit will be allowed to compromise the UK’s biosecurity in any way? Will the Minister explain how checks on biosecurity will be made at the Northern Ireland border in the absence of a hard border and of any legal requirement for checks on material in transit to the UK to be done at the first point of entry to the EU?
The SI demonstrates that there have been omissions in previous SIs. Will the Minister commit to a complete review of all EU exit SIs once we have passed them, in order to identify any other errors or omissions? This repeat SI also gives us the opportunity to follow up on questions that I asked on 19 March. I asked whether the Government had any plans for information sharing with other EU countries on biosecurity. The Minister mentioned that the UK was developing its own database. Can he tell us whether that is now available, and if so, how much does it cost? I asked about the preferential treatment for roll-on roll-off plant shipments. The Minister mentioned the increased biosecurity afforded by containerisation. Could the Minister tell us whether that would also apply to containers being shipped directly by rail?
I asked about the volume of trade for which this SI is relevant. The Minister replied that the Government do not have data on the volume of EU transit trade in plants, which makes the point that I had intended to raise, namely that as they do not know what volume of checks will be needed, the Government will have to plan for significantly greater capacity than they expect to need. Otherwise, there is a very real danger that the capacity will not be sufficient. I would like to remind the Minister that the aforementioned red-necked longhorn beetle was introduced into this country from China in a consignment of decorative plants, so the lack of checks has already proven to be an issue, and may well become more of an issue. Following the previous Minister’s reply on 19 March, has the Minister asked for an assessment of the volume of checks that will be necessary?
No purpose would be served by voting against this SI, as it does not contain any provisions that we object to. However, as with all these SIs, the problem lies more with what might not be in them than with what might be in them. Our fear remains that if we do crash out of the EU without a deal, it will be extremely difficult to overcome these omissions.
It is a pleasure to serve under your chairmanship, Ms Ryan. As my hon. Friend the Member for Ipswich has laid out, the Opposition will not be opposing the SIs, because they fix the Government’s own mistakes.
Regular watchers of these SI Committees on the parliamentlive.tv website—I am sure there are many—will know of the concerns shared by my hon. Friends the Members for Stroud (Dr Drew), for Workington (Sue Hayman), and for Ipswich—the shadow Department for Environment, Food and Rural Affairs team—that these SIs are being rushed through with mistakes, or gremlins, as I called them in our last SI debate, being inserted into the statute book. There is too little time for scrutiny. There is widespread and understandable stakeholder fatigue, so many of these problems, which might otherwise have been spotted by stakeholders, are not being highlighted, because there is such an avalanche of them on their desks.
This raises a number of concerns in relation to the Animal Health, Alien Species in Aquaculture and Invasive Non-native Species (Amendment) (EU Exit) Regulations 2019, because time and again, when the elements of these instruments have been considered by SI Committees, the Opposition have raised concerns that poorly drafted and hurried secondary legislation is polluting the statute book. Those concerns have again been proven valid, because we are being asked to correct the mistakes of a Government who got Brexit badly wrong, and got these SIs badly wrong.
The purpose of this SI is to amend mistakes to the four EU exit SIs rushed through by the Government ahead of the 29 March deadline. In discussion on each of those SIs, the Opposition raised concerns about the breakneck speed at which we were asked to wave the provisions through. We know that at least 515 Brexit-related SIs have been laid before Parliament since 26 June. What we do not know, as my hon. Friend the Member for Ipswich said, is how many of those have errors in them. In Committee, the Opposition warned about the lack of scrutiny. We are now using precious additional parliamentary time to pass legislation that was poorly drafted and approved in a rushed manner only a few weeks ago.
The fact that we are being asked to approve corrections to these errors highlights the concerns that were raised repeatedly about the lack of proper scrutiny. Before I come on to those concerns, I would like to say that I am grateful to the Minister for today apologising to the Committee for these errors. I assume that it was not his pen making these typographical errors, but I am grateful for his admission of them. Will he reassure hon. Members that any other errors found in these SIs or additional ones will again be brought to the House, so that they can be clearly and transparently admitted to and corrected, and so that no errors or mistakes, inadvertent legislation, surprise provisions or curious interpretations due to spelling and grammar errors will stand on the statute books in perpetuity?
The Import of and Trade in Animals and Animal Products (Amendment etc.) (EU Exit) Regulations 2019, which is contained in this SI, corrects the imports instrument in respect of Commission decision 2006/146EC, on certain protections and measures regarding fruit bats, dogs and cats coming from Malaysia and Australia. Dogs and cats are certainly something that a number of my constituents have written to me about; they have largely written about ensuring that these animals are not eaten in the UK. Sadly, that is not what this provision does. The imports instrument revokes the decision. A single article from this decision, article 5, was intended to be revoked, but instead the entire decision was revoked in error. Regulation 5 of this SI fixes that mistake, which should have been spotted in the sifting process.
This instrument also corrects the imports instrument in respect of Commission decision 2007/275, concerning the list of animals and products to be subjected to controls at border inspection points. The explanatory note says:
“The Imports instrument was intended to remove lists of commodities subject to checks at border inspection posts from the annexes of this Decision so that they can be published elsewhere and amended more easily, but they were left in the legislation in error.”
I am glad that such errors have been spotted, and that we have the opportunity to fix them.
In regulation 5(11)(b) in the instrument before us, which replaces 2006/65 with 2006/605, a number of errors have been corrected, including the one I mentioned. I am glad that it has been spotted. My hon. Friend the Member for Stroud took the instrument on invasive non-native species through Committee last time; he said the major objective was
“taking out the words ‘Member State’ and sticking in their place the words ‘appropriate authority’.”
However, the Government failed to do that, which is why the instrument before us sets out to do this under regulation 2(3)(b). Microsoft Word’s find-and-replace tool is useful; I suggest that the Minister familiarises himself with it.
My hon. Friend the Member for Stroud also said:
“someone has had to do an awful lot of work, and I do not know whether they have done it well or whether they have covered all the bases.”—[Official Report, Fifth Delegated Legislation Committee, 29 January 2019; c. 5.]
It seems he was correct to say that all those bases were not covered by the previous Minister.
The invasive non-native species instrument is important, and it is legislation that we cannot afford to get wrong. From foot and mouth disease to agricultural diseases, we need to ensure that our laws are correct. There are 1,820 notifiable tree diseases that affect various species in this country, and we know disease is ever present. Ash dieback and the oak processionary moth have taken out major trees in this country, and we must ensure that the regulations on their protection, and actions against diseases, are up to date. That is why this legislation is so important, and why it is fundamental that we get the detail of these SIs right, and not confuse the word “biogeographical” with “biographical”—a basic error that seems to have slipped through the system. That relates directly to the concerns I raised in my opening remarks about the breakneck speed at which these SIs have been pushed through. It is embarrassing for the Government to have to correct such basic errors in this SI, but I am glad that they have ’fessed up to their mistakes and are correcting them.
The preamble to much of the European regulation on invasive alien species was not included in this instrument, yet the Minister will know it is quite an important element of the way we lay down how such species are dealt with. On the concerns raised my hon. Friend the Member for Stroud, have the Government considered whether they could include the preamble in a future SI, to ensure that that really important part of the legislation is not lost? It is quite detailed and a bit techy, but it is important for the overall setting of this SI.
I turn to mistakes in the aquatic health SIs, addressing regulations 3 and 4 of the instrument before us. These SIs were approved through the negative procedure and were not subject to scrutiny in Committee. Although they had only minor typographical errors, such errors could have an impact on how the law is operated and enforced. I will repeat the question posed by my hon. Friend the Member for Ipswich, but in relation to this SI. How can we be confident that there are not more errors, especially in SIs that have been approved through the negative procedure? Does the Department intend to review SIs that have come through the negative procedure—in a similar way to this SI, with this mistake—to ensure that no further errors are polluting our statute books?
My final point is on the impact assessment of these SIs. The Minister will know, because I have said it once or twice in SI Committees, that I am not a fan of the phrase
“no, or no significant impact”
in explanatory memorandums. I encourage him to work with the House authorities and the Leader of the House to try to correct that. There is a big difference between no impact and no significant impact. We should not allow that catch-all phrase in explanatory notes, because it reduces their validity. It reduces the information by which it might be determined that there is no impact. “No significant impact” implies that there is some impact.
As we have said, the Opposition will not oppose the instruments. The situation is embarrassing for the Minister, but I am grateful to him for coming to ’fess up and correct the mistakes. I should be grateful if he offered a commitment that any future mistakes spotted in these hurried and rushed SIs will be corrected in a similar manner.
It is always a pleasure to serve under your chairmanship, Ms Ryan. I have a couple of thoughts on matters of concern. I share the concern about the errors. We all agreed at the time that statutory instruments were getting far too rushed and it was anticipated that there would be far too many mistakes. I agree generally with the two Members who have just spoken.
Will the Minister outline what would have happened if the exit day—whichever one it might have been—had happened; or what might happen on whatever date it might be in the future? What disruption could it have caused, in his opinion? I anticipate that there still might be some disruption, if errors occur in future. How will we handle it if errors are made, and what disruption will that cause to businesses?
I am grateful to members of the Committee for their contributions and, indeed, their forensic questioning under severe time pressure.
As has been said in previous Committees, we have had to deal with a huge amount of legislation in a short period to prepare for an EU exit that we thought would be on 29 March, and then 12 April. It is right that we got the legislation in place. I think everyone would recognise that not only have we had to work incredibly hard, but so have DEFRA officials and the DEFRA legal team.
The hon. Member for Plymouth, Sutton and Devonport talked about a number of errors. There have been errors and I have apologised for those, but I stress, particularly in relation to the first of the two SIs we are considering, that most of the amendments were not due to errors. They were to catch up with EU regulation. [Interruption.] It is true. That is clearly something that, collectively, we will have to watch, and on which DEFRA will take the lead. As EU regulations develop, change and progress, we will need to make sure that rolling SIs catch up on that law.
When we leave—whenever that time is, before 31 October—we need to make sure that the UK statute book is in the right place. Indeed, the hon. Member for Falkirk talked about the need to avoid disruption. That is the reason for what we have done collectively, across both sides of the Committee. Countless other MPs and colleagues were involved in the process as well. The aim of that exercise was to minimise disruption. I think, collectively, we did important work on that.
On the point about disruption, work also needed to be done to communicate to business and other stakeholders. Again, we have made good progress, but I assure members of the Committee that we will continue to work to be prepared for EU exit. We will have to redouble our efforts to engage with stakeholders and businesses in the relevant industries to make sure they are ready whenever, and in whatever scenario, we leave the EU.
We will have to continue to work on the matters in question. While I apologise for the errors, there was a need for some of the changes—particularly in the first of the SIs. In fact, we always said that a number of SIs would use the urgent procedure under the European Union (Withdrawal) Act 2018, but that it would be used only as a last resort. However, we recognised the necessity of laying a few critical SIs, which were required to provide certainty in advance of EU exit day.
The hon. Member for Ipswich asked a number of questions. Our intention to retain relevant EU legislation has inevitably meant that it was not possible to include everything in earlier SIs. Some of the timelines were difficult to meet, because of the gap between SIs that had already been prepared and EU regulations that had been made. We did our best to put the updates into the previous SIs, but not all of them could be included. That is why there were always going to be some SIs laid under the urgent procedure. We have worked incredibly hard to ensure that the number is minimal.
Some Members may ask why the affirmative procedure means that these SIs have been brought forward so quickly. It is because the procedure means that the SIs have to be debated within 28 days and we needed to ensure that we met that deadline.
Questions were asked about why different subjects or issues were grouped together. I accept that some of the links are not completely obvious; that is probably an understatement. The reason is that we need to make sure that the UK statute book is as fully operational as possible. I will make every effort, with the DEFRA team, to ensure that as we move forward, those SIs are as clear and distinct as possible.
A number of issues were raised regarding biosecurity at the Northern Ireland border. Biosecurity risks for animals and animal products from the EU have not changed. In order to allow trade to continue to flow smoothly, animals and animal products will be able to move freely from the EU to the UK, as they do now. The UK remains committed to not imposing a hard border between Northern Ireland and Ireland under any circumstances. That may require limited additional arrangements. Further information will be made available as soon as possible.
This is quite an important point. The issue being dealt with here is imports from third countries that are currently checked at the first EU point of entry. If they come via the United Kingdom, and then go into the Republic, how can they be checked at the first EU point of entry if there is no hard border between Northern Ireland and the Republic?
With the hon. Gentleman’s permission, I will come back to that point later. I will seek a more detailed explanation.
The hon. Gentleman raised some other points, which I will get on to right away. On his point about systematic inspection of regulated goods, in future those goods will be accompanied by a phytosanitary certificate, which is an official document issued by the relevant national plant protection organisation confirming that prescribed requirements have been met. These requirements will be the same as those under the plant passport scheme, and the phytosanitary certificate will be required for each consignment exported. This will require a greater level of official oversight than is currently necessary under the plant passport scheme, and is necessary to meet international obligations. I hope that gives comfort to the hon. Gentleman.
The hon. Gentleman also made points about databases and systems. We are developing our own database to capture details of interceptions and incursions from day one, to inform our decision making. All EU systems have publicly available elements, which the UK will continue to be able to access after EU exit. Our dedicated UK-wide horizon-scanning team will continue to gather intelligence on plant health risks, including information from other organisations, agencies and networks, by increasing bilateral relationships with key trading partners and nearest neighbours. Functionality has been added to the UK plant health portal to replace some of the EU notification system functions.
The hon. Member for Ipswich made a point about red-necked longhorned beetles. We have general powers to act against such pests, but the EU has recently introduced specific emergency measures and we wanted to make sure that those elements were added to the UK statute book. He also made points about importers’ readiness to change around inland inspection posts. To date, 33 viable applications have been received for premises wishing to be authorised as places of first arrival for regulated plant material from third countries arriving via the EU into the UK, by our roll-on/roll-off ports. These applications are under assessment and we expect that they will be completed by EU exit day.
The hon. Gentleman also raised concerns around transmissible spongiform encephalopathies errors and wondered why they had been included in this SI. This correction refers to a requirement for the owner or keeper of animals placed under movement restrictions, in accordance with these regulations, to comply with the prohibitions in the new TSE law on feeding certain products to such animals. This amendment will transfer the power for approval to the Secretary of State, following EU exit.
I hope that I can now answer the question from the hon. Member for Ipswich about Northern Ireland border issues. We have always been clear that there will be no physical infrastructure or related checks and controls at the border, and this will be a key part of our ongoing negotiations.
Notifications will be required for live animals. Germplasm and animal by-products not for human consumption, and high-risk food and feed are subject to vet checks,. Live animals and these other elements that travel through the EU are subject to vet checks from third countries before arriving in the UK, and will need to be notified and checked at the UK border inspection post, or BIP.
High-risk food and feed not of animal origin will need to be notified and checked at the UK BIP or designated port of entry. If the hon. Gentleman has further questions on that issue, I will be happy to answer, either in writing or outside the Committee. I hope that I have addressed his questions.
I will move on to a couple of the other questions; I have taken quite a lot of the Committee’s time already. I will just try to answer the last question from the hon. Member for Plymouth, Sutton and Devonport. Notwithstanding his concern about corrections, we will make sure that lessons are learned from what has taken place. The head of our legal department within DEFRA will review the process but also our current status. All I can say is that there are multiple layers of checking—I am sure that was the case—and lots of scrutiny. So the number of errors that we have come up with, while massively regretted, is small in comparison to the sheer volume of work that we have been through over recent weeks and months.
The hon. Gentleman raised concerns about invasive species. Article 15.6 of the EU Invasive Alien Species Regulation states that costs incurred during enforcement of the import controls in regulation are to be met by the importer, unless the member state concerned determines otherwise in a domestic enforcement and permitting order, which supports the EU regulation and was made earlier this year. The UK Government decided that importers will be responsible for these costs.
The invasive species instrument, which was made earlier this year to correct operability deficiencies in the EU regulation, corrected article 15.6, but not in a way that was compatible with the provisions in the enforcement and permitting order. The amendment to regulation 7(3)(e) of the invasive species instrument made by this instrument corrects that oversight and ensures that the EU regulation and the domestic order are compatible after we leave the EU. I will carefully consider the hon. Gentleman’s suggestion that there should be a future “review”; I think that was the word he used, but I will clarify afterwards.
I hope that we have been able to answer in some detail the questions that have been put, and for the reasons that I have set out, I commend these SIs to the House.
Question put and agreed to.
That the Committee has considered the Animal Health, Plant Health, Seeds and Seed Potatoes (Amendment) (EU Exit) Regulations 2019 (S.I. 2019, No. 809).
ANIMAL HEALTH, ALIEN SPECIES IN AQUACULTURE AND INVASIVE NON-NATIVE SPECICES (AMENDMENT) (EU EXIT) REGULATIONS 2019
That the Committee has considered the Animal Health, Alien Species in Aquaculture and Invasive Non-native Species (Amendment) (EU Exit) Regulations 2019 (S.I. 2019, No. 813).—(David Rutley.)