Product Regulation and Metrology Bill [Lords] (Third sitting)
Thursday 15th May 2025
(1 day, 17 hours ago)
Public Bill CommitteesProduct Regulation and Metrology Bill [HL] 2024-26 View all Product Regulation and Metrology Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 15 May 2025 - (15 May 2025)
The Committee divided: - Ayes: 4 / Noes: 11 - Question accordingly negatived.
The Committee divided: - Ayes: 4 / Noes: 11 - Question accordingly negatived.
The Committee divided: - Ayes: 4 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 4 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 1 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 1 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 1 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 1 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 10 - Question accordingly negatived.
The Parliamentary Under-Secretary of State for Business and Trade (Justin Madders)
I beg to move, That the clause be read a Second time.
It is a pleasure to see you in the Chair, Ms Vaz.
The Government have been clear in our intention to maintain a strong, co-operative relationship with the devolved Governments and to ensure that the devolution settlements are respected in both principle and practice. New clause 1 will place a statutory requirement on the Secretary of State to obtain consent from the devolved Governments where regulations contain provisions within their devolved competence. That will provide a decisive role for devolved Ministers and underpin continued collaboration in developing product regulation that best supports businesses and consumers in all parts of the UK.
With that specific context in mind, I hope the devolved Governments will support the new clause and recommend that their respective legislatures give their consent, and I look forward to hearing the outcome of those debates. I thank ministerial colleagues and officials in the devolved Governments for their engagement and collaborative approach to the Bill.
This important new clause demonstrates that by listening carefully, engaging sincerely and acting in good faith, the United Kingdom Government and the devolved Governments can come together to find shared solutions. The legislation provides a new framework for product regulation and metrology that is agile, future-facing and tailored to the needs of the UK, and the new clause will make sure the framework works for all parts of the UK.
Dame Harriett Baldwin (West Worcestershire) (Con)
It is a pleasure to serve under your chairmanship, Ms Vaz.
I put on record my thanks to the Minister for his rapid reply to the points that were raised on Tuesday. I asked questions on time limits for emergency powers under clause 4, on whether amending the definition of “online marketplace” will be subject to the affirmative procedure, and on Government amendment 1, on which I confessed to being a bit confused. We needed some clarification, which we now have in the shape of a very prompt letter. I thank the Minister and his officials for getting that out so quickly. I believe that copies of the letter are now available in the Libraries of both Houses.
New clause 1 provides much-needed and helpful elaboration on the extraordinary powers taken by the Secretary of State in earlier parts of the Bill. It will be important to clarify exactly which of those powers are reserved competence and which are devolved competence, and this new clause sets out quite clearly the collaborative approach that the Government intend to follow.
I will raise further questions when we come to new clause 5 on how the Windsor framework and the Stormont brake will interact with subsections (3) and (4) of new clause 1, but as far as new clause 1 itself is concerned, the Minister has set out clearly the process for making regulations that contain provisions affecting the whole of the United Kingdom, recognising how important it is that the United Kingdom has a consistent internal market. The new clause provides clarification along those lines.
Question put and agreed to.
New clause 1 accordingly read a Second time, and added to the Bill.
New Clause 2
Purpose
“(1) The purpose of this Act is to improve the regulation of products and metrology.
(2) The Secretary of State must, in taking any actions under this Act, advance that purpose while prioritising the maintenance of the United Kingdom’s regulatory autonomy and the United Kingdom’s regulatory competitiveness.
(3) Accordingly, and so far as it is possible to do so, provision made by virtue of this Act must be read and given effect so as to achieve the purpose mentioned in subsection (1) to the extent that it is consistent with the maintenance of the United Kingdom’s regulatory autonomy and regulatory competitiveness.
(4) When taking action to improve regulation under this Act, the Secretary of State must have regard to maintaining the highest quality regulatory framework.”—(Dame Harriett Baldwin.)
This new clause sets out that the purpose of this Act is to improve the regulation of products and metrology while maintaining the United Kingdom’s regulatory autonomy.
Brought up, and read the First time.
Dame Harriett Baldwin
I beg to move, That the clause be read a Second time.
New clause 2 is incredibly important. As the Committee heard on Tuesday, it is all too clear how many Henry VIII powers the Secretary of State is taking under this legislation. We do not need to rehearse the concerns raised about those wide-ranging Henry VIII powers by the Delegated Powers and Regulatory Reform Committee in the other place.
I am sure the Government will want to agree to new clause 2, with which we are trying to be incredibly helpful. The Minister set out on the record on Tuesday how he thought we were exaggerating, pulling the emergency cord and sounding the alarm about the potential for this legislation to be used to dynamically align the United Kingdom’s product regulation and metrology with that of the European Union. New clause 2 would helpfully allow the Minister, when he agrees to it, to recognise that the legislation has a much narrower purpose.
The purpose of the Bill is to improve product regulation and metrology. Importantly, new clause 2(2) states that the Secretary of State
“must, in taking any actions under this Act, advance that purpose while prioritising the maintenance of the United Kingdom’s regulatory autonomy and the United Kingdom’s regulatory competitiveness.”
That clarifies the importance of the Bill’s purpose, how competitiveness must be taken into account, and, above all, the idea of regulatory autonomy. That is emphasised again in subsection (3).
As we said at the beginning of the Committee, we all want the UK’s product regulation and metrology to be of the highest quality and have the best possible regulatory framework, but it must also be autonomous. Supporting this new clause would allow the Government to show the substance behind their words by putting them into legislation.
Despite its ostensibly noble intentions, the Bill poses significant risks to the principles of transparency, accountability and fairness that underpin our legal and regulatory systems. In short, new clause 2 does what it says on the tin. It would ensure that the Bill has its intended consequences, rather than the unintended consequences that sometimes slip through our scrutiny.
The Committee has heard that the Bill will enact far wider powers than anyone outside this place would consider to be in scope of product regulation and metrology. At the heart of the Bill lies a troubling delegation of power, and the Opposition voted against clauses on Tuesday because this skeleton legislation is an extraordinary expansion of the Secretary of State’s powers. For example, as we heard on Tuesday, there is the creation or expansion of criminal offences, and the powers conferred upon the Secretary of State and “relevant authorities.” We did not get to the bottom of who those relevant authorities are.
The powers are alarmingly broad, and there is little to no clear guidance on what the offences will entail. The lack of specificity raises serious concerns about the potential for overreach and the erosion of due process, because criminal sanctions carry profound consequences. It is imperative that Parliament retains control over their creation and scope, and ensures that such powers are exercised with the utmost caution and accountability.
The vague language on enforcement bodies, which we have highlighted throughout our scrutiny of the Bill, exacerbates the uncertainty faced by businesses and consumers alike. Without explicit identification of which bodies will have the authority to impose criminal sanctions, businesses will be left in a state of apprehension and confusion. That ambiguity not only hampers compliance efforts but fosters an environment ripe for arbitrary enforcement action.
On Tuesday we also discussed the provisions granting powers to inspect premises, seize products and demand documentation without clear safeguards—I am sure that all members of the Committee will agree that those are deeply concerning. The criteria for suspicion are also undefined, leaving the door open for discretionary and potentially unjustified investigations. If left unchecked, such powers could lead to overbearing Government interventions in business activities, disrupt operations and stifle innovation. The lack of procedural safeguards further compounds these risks, making it imperative that we reassess the provisions to protect the rights and interests of all stakeholders.
The Bill’s reliance on secondary legislation, particularly in areas such as artificial intelligence, the definition of “online marketplace” and environmental impact, raises significant concerns about the adequacy of parliamentary scrutiny. The use of statutory instruments to introduce new regulations allows for rapid implementation, but at the cost of thorough debate and amendment. This approach diminishes the opportunity for comprehensive oversight and increases the likelihood of unintended consequences that could adversely affect businesses and consumers.
Although its objectives may be well intentioned—we have said all along that we do not question the good intentions of the Minister and Secretary of State—the Bill before us poses substantial risks to the principles of democratic governance, legal certainty and economic vitality. It is incumbent on us to ensure that any regulatory framework is crafted with clarity, accountability and respect for the rule of law.
This new clause would set out some examples of the Bill’s purpose to bring home the importance of this. We believe that the Bill gives the Government the power to dynamically align our regulations with those of the European Union. That sounds innocuous, but it means that product regulation in this country would be set by another Parliament. We propose a completely different approach so that, in all the different uses of the Bill, the focus is on the competitiveness of our regulations and ensuring that UK-regulated products set the standard and the benchmark around the world.
We should be proud of our history of product regulation and metrology. The hon. Member for Erewash, who is on this Committee, is the first metrologist ever elected to Parliament. He has spoken eloquently about the UK’s brilliance in defining a standard for metrology, and we should be proud of that brilliance. In all our agreements as an independent nation, we should seek to have other countries recognise our brilliant product regulation and metrology.
Certification for the UK market should be a mark of great pride. In all the trade agreements that the Government are negotiating—as an aside, I note that we have not seen their detail—we should seek recognition of these excellent standards, not only by our friends and neighbours in the European Union but by our biggest single-country trading partner, the United States, by our friends in the Commonwealth countries of Canada and Australia, and by the countries that have signed up to the comprehensive and progressive agreement for trans-Pacific partnership.
Aphra Brandreth (Chester South and Eddisbury) (Con)
It is a pleasure to serve under your chairmanship, Ms Vaz. I rise in support of new clause 2, which would be an essential and constructive addition to the Bill. It sets out a clear, common-sense purpose to ensure that any actions taken under the Bill not only improve product regulation and metrology but ensure that we do so while upholding the United Kingdom’s regulatory autonomy and competitiveness.
Some members of the Committee may ask why a purpose clause is necessary, but I argue that the new clause would do something quite fundamental. It would place sensible and proportionate boundaries on what is otherwise a very broad piece of legislation. In other words, it would limit the scope of the Bill. Without something like this, Ministers will effectively be handed sweeping discretion to use the powers in any number of ways, possibly including alignment with EU rules without full parliamentary debate or scrutiny. We all want regulation that works in the UK’s interests, but we must also ensure that those decisions are made here, transparently and with proper oversight.
Mr Richard Holden (Basildon and Billericay) (Con)
Is the new clause not particularly important because of the unprecedented criticism in multiple reports from the DPRRC in the other place? That criticism calls into question the many issues that my hon. Friend raises, so there is an extra onus on the Government to accept new clause 2.
Aphra Brandreth
Absolutely. My right hon. Friend makes a very important point. These are real concerns that were raised in the other place, and I will explain why we need to make sure that the new clause is accepted. It would put the principle on the face of the Bill that we should make these decisions transparently and with proper oversight. The new clause says clearly that the Secretary of State must exercise these powers in a way that strengthens, not weakens, our autonomy and competitive standing. Surely we can all agree that is what our constituents understandably want.
The new clause would also set a standard for the quality of regulation. It would make it clear that Ministers must consider how to maintain a high-quality regulatory framework, rather than acting hastily or in a piecemeal way. That would be good not only for consumers but for businesses, which need clarity, certainty and consistency.
The new clause would not block progress or prevent co-operation with our international partners. It would simply ensure that major decisions are guided by the core principles of autonomy, competitiveness and quality, and that they are not taken behind closed doors with minimal oversight, so I am sure that Government Members will want to support it. After all, if they believe in transparency, parliamentary sovereignty and maintaining high standards, why would they not support putting those principles clearly on the face of the Bill? If not, we are left to ask whether there is a deliberate ambiguity. Do they not wish to say where they stand on automatic EU alignment or on Parliament’s proper role in scrutinising decisions?
In a previous sitting, I raised concerns about the ambiguity that runs through the Bill. That ambiguity does little to build trust, whether among businesses, consumers or the wider public. If Government Members support alignment by default, let us have that debate—let us hear the case for it in full view, with the transparency that our constituents expect—but if that is not their intention, and if they share our concerns about decisions being made behind closed doors without clear checks, they should back the new clause. It provides a clear, reasonable and proportionate safeguard.
New clause 2 would not create obstacles; it would create accountability. It sets out guiding principles where—let us be clear—they are needed. That is why I believe it deserves the Committee’s support.
Alison Griffiths (Bognor Regis and Littlehampton) (Con)
It is a pleasure to serve under your chairmanship this morning, Ms Vaz.
New clause 2, tabled by my hon. Friend the Member for West Worcestershire and my right hon. Friend the Member for Basildon and Billericay, is not just a bit of introductory waffle. It is the constitutional backbone that the Bill is sorely missing. What it does is straightforward: it spells out what this legislation is actually for. Yes, it is about improving product regulation and metrology, but, crucially, the new clause makes it clear that that must be done by putting the United Kingdom’s regulatory autonomy and competitiveness front and centre. Those are the very principles that we fought for during Brexit.
We did not leave the EU just to create Brussels bureaucracy with a new postcode. We left so that decisions about how we regulate, trade and grow could be made here by elected representatives answerable to the British people. Yet what we have in the Bill from this Labour Government is worryingly vague. There is no clear objective and no anchor, just a blank cheque that allows Ministers and officials to drift into copying EU rules or centralising control, all without proper scrutiny. That is not careful lawmaking, but a recipe for regulatory sprawl.
New clause 2 would put a stop to that. It is about setting the right direction from the outset. Regulation should support growth and promote clarity, not stifle it, and rules should work for this country, not be imported to satisfy someone else’s system. The new clause would lock in a proudly Conservative vision in which the state backs enterprise, in which we trust British industry, and in which Parliament, not faceless regulators or quangos, has the final say. I urge colleagues to support the new clause.
Clive Jones (Wokingham) (LD)
It is a pleasure to serve under your chairship, Ms Vaz. As somebody who has imported and exported products to and from Europe and the rest of the world for much of the last 40 years, and seen the regulations change much over the last 40 years, I believe it is sensible that we are aligned to our major markets. The hon. Member for West Worcestershire talked about that, and she is absolutely right. One of our major markets is right on our doorstep. We need to be aligned to it because it is much better for our businesses if our regulations—
Clive Jones
I will only talk for a moment. I will carry on and the hon. Lady can come in later if she wishes.
In my experience, it is important that regulations are clear for UK manufacturers. They should have one set of product regulations, rather than one set for the UK, one for the USA and another for Europe. If the Bill allows us the possibility to align with Europe, that is extremely good.
Mr Holden
There are products in respect of which we have really good relationships with the EU and obviously want to align closely to it, but for some products we surely want to align with our bigger export markets. For example, we export a lot more of certain products to Japan and the USA. Why would the hon. Gentleman want to ensure that our alignment is purely with Europe, rather than with our major markets?
Clive Jones
I have not said “purely with Europe” at all. We should align with our major markets. I do not know what industries the right hon. Gentleman is referring to, but in my experience as an exporter to Europe and the rest of the world, it is much easier to have one set of regulations.
Alison Griffiths
My hon. Friend the Member for West Worcestershire talked about international markets. One of the opportunities presented by our leaving the European Union is to be able to sell to other international markets. She gave the fantastic example of the shower trays that many of us used this morning—
Alison Griffiths
Does the hon. Gentleman agree that we should be exporting internationally?
Justin Madders
We have had another interesting debate—a slightly repetitious one that I am sure we are all becoming familiar with. The shadow Minister, as always, was helpful in introducing her new clauses. She is slightly optimistic about the prospect of our accepting them, but I understand that it is her role to challenge and scrutinise the Bill by moving amendments and new clauses.
I agree with the shadow Minister about the importance of improving our regulation and metrology framework. That is indeed what the Bill is about. We had some helpful discussions in the other place about how best to do that. For example, a balance needs to be struck to protect consumers while making regulation workable for business. That balance is not best served by having in the Bill a broad and subjective purpose “to improve”.
The new clause also mentions the prioritisation of
“the United Kingdom’s regulatory autonomy and the United Kingdom’s regulatory competitiveness”.
At the risk of repeating what I said on Tuesday, the Bill is all about regulatory autonomy. It will provide powers to enable the UK to change existing regulations or introduce new ones in support of our needs and interests. The Bill introduces those powers because they are currently lacking.
The shadow Minister said that we will have our product regulations set by the EU, and the hon. Member for Chester South and Eddisbury said that we will be taking up new rules by default. They are, I am afraid, incorrect on both points. The Bill actually does the opposite and allows us to take a considered view on a case-by-case basis. Indeed, that is what the previous Conservative Government did through the regulations introduced last year.
The powers in the Bill will also mean that the UK can maintain regulations that support competitiveness. That requires a balance between a range of objectives, including consumer safety and proportionate regulation for businesses. Any changes that we introduce will be consulted on, and Parliament will have a role in overseeing the regulations, as we discussed at length on Tuesday.
Dame Harriett Baldwin
It is no surprise to the Committee that the Liberal Democrats’ position is to go back into the customs union, which would require dynamic alignment. It is clear from yesterday’s vote on the Opposition day motion how Government Members feel about it. I have given the Minister the opportunity to agree to this sensible new clause on the Bill’s purpose, but I got the hint that he is potentially not going to vote in favour.
Should the Government use the powers they have under this legislation to agree to dynamic alignment at the surrender summit next week, the voters at the next general election will be incredibly disappointed. We have got to a point where an independent free trade agreement could be agreed with our friends in the EU, in India and in the United States, and we would not want to give up those opportunities as a result of widening the Bill’s purpose, so I will press the new clause to a Division.
Question put, That the clause be read a Second time.
Dame Harriett Baldwin
I beg to move, That the clause be read a Second time.
Everyone on this Committee can agree that the UK is a proud global trading nation and, however we voted in the 2016 referendum, that one of the changes that has occurred has been our sovereignty over trade agreements. We agreed a comprehensive trade and co-operation agreement with our friends and neighbours in the European Union, with zero tariffs and zero quotas, and most of our product regulation and metrology is inherited from the time when we were a European Union member.
I put on record my welcome for the way in which the Government have pursued free trade agreements in line with the United Kingdom’s heritage as a free trading nation. I do not think the details of the new trade agreement with India or all the details of the US free trade agreement have been fully shared with the House at this stage, but from what we can tell there is an improvement in market access for UK manufacturers and for those who follow UK product regulation and metrology.
We can all see how important it is that the powers that the Government are taking under this legislation do not accidentally or intentionally cut across any of the international agreements listed in new clause 3. We would not want any of the regulations made under this legislation to disadvantage the United Kingdom under the comprehensive and progressive agreement for trans-Pacific partnership; the UK-Japan comprehensive economic partnership agreement; the UK-Canada continuity agreement and any improvements to that; the UK-Australia free trade agreement; the free trade agreement with New Zealand; and any other trade treaties, such as the one recently announced with India and the one that is subject to negotiations with the United States of America.
There is an extraordinary change in the UK’s trading opportunities. We have this advantageous new trading position with, in effect, a foot in both camps. We are uniquely placed in respect of European and American trade. It would be utter madness for the Government to do anything with this Bill that would cut across the freedoms we have. It would be much more valuable if the Government would, by agreeing to new clause 3, take this opportunity to show that they want to be completely pragmatic, and to ensure that we continue to have the opportunities to open up markets and that product regulation and metrology is not a barrier to that.
New clause 3 serves to prevent the Secretary of State from making regulations to align the United Kingdom with the European Union in a way that might hinder any future or existing free trade agreements. It is a pragmatic clause and a necessary step towards maintaining the strength of the UK’s trade relationships and protecting the long-term prosperity of our businesses. The hon. Member for Wokingham rightly pointed out how important it is for us to trade with our European friends and neighbours. However, it is also important to note, as we saw in the recently published Santander trade barometer, that for businesses in the UK, there is a gradual but steady pivot away from the EU and towards global partners. Those incredibly useful statistics show that not only have UK businesses been regarding international trade as more important, increasingly over time, but that they are widening the range of trading partners that they do business with.
When the shadow Business Secretary, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith), made the point in the Chamber that the number of references to the EU in the legislation is far more significant than the number of references to any other country—the United States, our single biggest trading partner, for example—the Secretary of State told him that the Bill will enable regulatory alignment with the EU only
“where it is recognised that we have the interest.”—[Official Report, 1 April 2025; Vol. 765, c. 221.]
On Tuesday, the Minister told this Committee that he thought Conservative Members had mentioned the European Union more than the Government had, and that he did not believe the Bill will be used to tie us to the EU. However, I refer the Minister to the Bill because, in its 13 pages, the EU is mentioned 12 times. The Bill’s impact assessment certainly implies that we will default to a European set of standards, and the Secretary of State has not defined what the aforementioned interests may be. We are therefore moving the amendment to ensure that the interests of the UK in our existing and future trade agreements are not undermined by unnecessary and egregious alignment with the EU on product regulation.
I am not making this up: we have heard, in advance of next week’s surrender summit, that one of the EU’s negotiating objectives is to lock down dynamic alignment with the UK. The EU looks at us and sees the free trade deals that it has not been able to do. The one with India is a prime example, as is the liberalisation of tariffs that was recently announced, which I know is a starting point for the Government in terms of the United States. The EU is pretty worried that we will make the most of these freedoms and show that they are one of the advantages of our not being a member any more, so the EU has this as a negotiating objective. I am sure that behind closed doors in the negotiations, Ministers are pointing to this Bill going through Parliament, to their significant majority, and to the fact that they can therefore turn this on like a switch.
As we stand on the precipice of a new era—one in which we can lean into our country’s global free-trading heritage—it is essential that we continue to forge strong trading relationships with our global partners. These agreements, many of which we negotiated after leaving the European Union, are pivotal to our future economic prosperity, and to the growth that the Government rightly seek for the UK economy.
The new clause explicitly states:
“The Secretary of State may not make regulations under section (1)(2) or section (2)(7) that will disadvantage the United Kingdom or its trade under”—
several key international agreements. These include, but are not limited to, the CPTPP—that opens up new markets in the Asia-Pacific—the Japan economic comprehensive partnership agreement, which strengthens ties with one of the world’s largest economies and biggest inward investors into the United Kingdom, and agreements with our close friends and Commonwealth allies New Zealand, Australia and Canada.
We made progress during our time in Government, and we welcome the progress that this Government are picking up. By urging the Government to agree to the amendment, we want to say that this is not merely a technical adjustment; it is a necessary safeguard to ensure that our regulatory environment—product regulation and metrology—does not inadvertently undermine the progress that we have made in securing those agreements.
Frankly, these treaties represent hundreds of billions of pounds in trade. They are foundational to ensuring that the UK remains competitive in a rapidly changing global economy. The CPTPP is estimated to increase UK GDP by £2 billion, and it could be higher if countries such as South Korea, which has very good product regulation and metrology, join. We should mutually recognise some of these things. Why would we want to tie ourselves purely to a bloc that is a declining share of the global economy?
Alison Griffiths
I rise to speak in strong support of new clause 3, which would introduce a critical safeguard to prevent Ministers from aligning UK product regulations with EU law if such alignment would jeopardise our existing trade agreements. Over the past decade, the United Kingdom has been forging a new path as global Britain, establishing modern, liberal trade agreements with key partners worldwide. Those include nations such as Australia, New Zealand, Japan, Canada and other CPTPP countries. Those agreements are predicated on the UK’s ability to act as a flexible sovereign regulator, not as a subordinate to Brussels.
Let us consider the CPTPP, which the UK joined in December 2024. It is a group of countries united by a common interest, representing 15% of the UK’s global trade and 13.5% of the UK’s global GDP. The UK’s accession is projected to boost our GDP by £1.8 billion annually and eliminate tariffs on 99% of UK exports to member countries.
Alison Griffiths
My right hon. Friend makes a valuable point. This is a flexible, forward-looking agreement with global ramifications.
The UK-India free trade agreement, signed in May 2025, is expected to increase bilateral trade by £25.5 billion by 2040 and enhance the UK’s GDP by £4.8 billion. The agreement will cut levies on 90% of British products sold in India, including whisky, food and electrical devices. The recent UK-US trade deal, announced on 8 May, provides a £5 billion opportunity for new US exports to the UK, particularly benefiting farmers and producers. Although the deal maintains a 10% tariff across the board on most UK exports, it offers relief to certain UK sectors, including through the elimination of US tariffs on UK steel and aluminium exports.
However, the Bill leaves the door ajar for a realignment with EU rules, often through delegated powers and without rigorous economic impact assessments. New clause 3 would establish a clear boundary: if aligning with EU regulations threatened to breach or undermine our global trade agreements, Ministers would have to refrain. The clause champions growth and supports global trade. It would ensure that we do not regress to a scenario in which Brussels dictates our standards, causing complications in our trading relationships with Tokyo or Washington.
If the Labour party is honest about cultivating global partnerships, it should welcome the new clause. It is imperative that we enshrine legal safeguards to prevent any regression into EU dependency. I urge the Committee to support new clause 3 and uphold the integrity of Britain’s proud global trade strategy.
Aphra Brandreth
The UK is a free trading nation. The fact that we are an island has meant that for centuries we have looked to the world for trade, and new clause 3 is an important safeguard that would ensure the Secretary of State does not act in a way that undermines our existing trade agreements, a number of which were negotiated by the previous Conservative Government, as we have heard.
Our trading relationship with Europe remains vital and highly valued, but this is also a moment to embrace the wider world and build on the strong partnerships that we have developed across global markets. Many emerging economies present exciting opportunities, and we are already fostering trade links with some of the world’s fastest-growing global trade blocs. This is about maintaining our commitment to Europe while continuing to be outward looking and globally engaged.
When the UK signed up to the European common market, Europe accounted for one third of global trade. In 2019, it accounted for 16% of global trade. By 2050, according to the OECD, it will account for only 9% of global trade. It is simply good business, forward looking and proactive to seek out the emerging markets on which the future global economy will be built. Progress in doing so was made under the previous Government, and the trade deals listed in new clause 3 are some of the most important.
I will speak to a few of the trade treaties that are listed, to underline their importance and the benefit they bring to the United Kingdom’s economy. The deal that the previous Government agreed with Australia was historic. It eliminated tariffs on UK imports from and exports to Australia, making it cheaper for some of our best-loved and most iconic brands to sell on Australian shelves, and it gave us the opportunity to have better and cheaper access to Australian favourites such as Vegemite and Tim Tams—although for the record I have to stress that I am definitely a Marmite fan.
The Australia trade deal was bespoke. It allowed us to play to our strengths, with a focus on our world-leading service, digital and tech sectors. It put our service industry on an equal footing in Australia and maximised the possibilities and opportunities for digital trade—it was a forward-looking deal. Thanks to that deal, UK businesses are guaranteed access to bid for an additional £10 billion-worth of Australian public sector contracts per year. Inward investment from the UK into Australia no longer needs to be reviewed by the Australian Foreign Investment Review Board, making it easier for British businesses to gain access to the Australian market and, crucially, cutting red tape.
We are market leaders in so many areas, and the world looks to us as the high bar for standards and products. We lead the way in the tech and digital sectors, and that deal delivered for businesses and consumers alike, including high personal data protection standards for British consumers. The UK services industry benefited to the tune of £5.4 billion in 2020 as a result of that free trade agreement. It slashed red tape and removed bureaucratic hurdles for small and medium-sized enterprises and unlocked new opportunities for them to grow and develop in a new market. The UK gained access to procurement contracts worth billions of pounds, which is the most substantial level of access that Australia has granted in a free trade agreement. We benefited from more flexible rules of origin when exporting goods that are better suited to modern supply chains. Importantly, that deal was negotiated on our terms by our Government.
The New Zealand trade deal was also a success and again highlights the importance of new clause 3. Like the Australian deal, all tariffs on UK exports to New Zealand have been eliminated, delivering a boost for British business and increasing its competitiveness. The now Leader of the Opposition, when she was Secretary of State for International Trade, wrote to the International Trade Committee outlining the benefits of that deal and how it was expected to boost trade with New Zealand by almost 60%, benefiting the economy by £800 million.
Finally, I want to mention the UK-Canada continuity agreement and why it is important and right to list in new clause 3. When we left the European Union, we rolled over 65 trade deals immediately and bolstered them with a further seven. For the Canadian continuity agreement, the previous Conservative Government secured continued access for UK products, such as cars, beef, fish and gin. In the previous Government’s strategic outline for an FTA with Canada, published in 2022, it was noted that Canada provided a great opportunity for UK SMEs, building a digital economy and bolstering innovation for the future—exactly the sort of opportunity that the UK should be looking for. The crucial factor of that deal, and the others that I have referred to, is that they were negotiated on our terms.
New clause 3 is important for ensuring that the progress we have made is not lost. It is about maintaining our competitiveness as a trading nation and not regressing to the bureaucratic red tape of the EU that we have moved away from. I hope that Government Members will demonstrate that they are forward looking by supporting the new clause. In doing so, they would reaffirm our shared commitment to a truly global Britain that is ambitious, outward facing and confident in shaping its own future on the world stage.
Justin Madders
First, it is appropriate for me to acknowledge the shadow Minister’s supportive words about the excellent progress that we have made on trade deals in recent weeks. As has been mentioned, the India deal could be worth up to £2 billion a year and will hopefully unlock new opportunities across the whole UK, including for advanced manufacturing in the west midlands, Scotch whisky in Scotland and our world-class life sciences sector in the north-west. There has also been the excellent work with the United States, which shows that we are determined to take our rightful place on the world stage and chimes with the No. 1 mission of this Government: economic growth.
It is also appropriate for me to mention the excellent growth figures for the first quarter of 2025, which came out this morning. The Bill will support growth by giving the Government the flexibility we need to ensure that product regulation is tailored to the needs of the UK, and to respond to global developments. The Bill will help us to ensure that regulations work effectively for both businesses and consumers, and that they continue to do so in the future.
Dame Harriett Baldwin
Given the importance of this point, I would be grateful if the Minister put on the record his acknowledgment that dynamic alignment is an ask from our European Union partners in the negotiations ahead of next week’s summit.
Justin Madders
Regrettably, I am not privy to the negotiations; I can only read the speculation in the newspapers, but clearly the Bill does not mean automatic alignment, dynamic or otherwise. It means the opposite, which is why a number of the arguments put forward by the Opposition are completely incorrect. I know that the 2019 election was the high point for the Conservative party in recent years and that it was all about our relationship with the EU, but we have left. We are in a new world, and the arguments that we are hearing from the Opposition are from a different era. The world has moved on. We are looking outward and working closely with our EU neighbours, as we should do, but unlike Conservative Members we are not obsessed with this issue. I am sorry to say that they have misread the mood of the public and the impact of the Bill. I ask that the new clause be withdrawn.
Dame Harriett Baldwin
The Minister just clarified for the record that, although it is not his or the Government’s intention to use the Bill in the way we have highlighted, those powers exist should they wish to exercise them. Both he and I have read about this in the media, as neither of us is privy to the discussions behind closed doors, but it is clearly a request from our European Union negotiating partners. This week, the Government voted down our Opposition day motion that would have given the Minister the opportunity to rule it out. In the light of that, and given the importance of the issues highlighted in new clause 3, as well as the fact that the Bill simply gives the Minister and his colleagues the chance to legislate in exactly the way they have been speaking about, I will press the new clause to a vote.
Question put, That the clause be read a Second time.
Dame Harriett Baldwin
I beg to move, That the clause be read a Second time.
New clause 5 is designed to obtain clarification on the record from the Minister about how Government new clause 1, which was agreed to earlier, will interact with the provisions in the Windsor framework to do with the Stormont brake.
As hon. Members will be aware, if Northern Ireland Assembly Members initiate the procedure under regulation 11 of the Windsor Framework (Democratic Scrutiny) Regulations 2024 in relation to an EU law affecting product regulation or metrology, the Secretary of State must not take any steps to implement that law in Great Britain until the Secretary of State has taken a decision under part 3 of those regulations. The new clause would make the position clear.
As colleagues will be aware, dynamic alignment of product regulation effectively already applies in the Northern Ireland economy. An update to the Windsor framework was agreed in Parliament last year, with Government support, regarding the democratic oversight of the 2024 regulations. The Northern Ireland Assembly has the important democratic right to trigger the Stormont brake, with the assurance that no UK regulations are aligned with the European Union following that decision in Stormont. Will the Minister put on the record that, should a piece of regulation be highlighted by the Stormont brake, and we were in a pending period while the UK Government negotiated with the European Union about its application, it would not be imposed in Great Britain during that period?
Great Britain is united with Northern Ireland, and we must ensure that our ties and duties to Northern Ireland are set out clearly in the Bill. Government new clause 1 goes some way to doing that, but new clause 5 would help to clarify the situation further. When the Prime Minister was recently asked in the Chamber whether he is a Unionist, he refused to confirm that he is. When asked after Prime Minister’s questions whether the Prime Minister is a Unionist, his official spokesperson said:
“I think the Prime Minister said before that, of course, he is the Prime Minister for the whole of the UK, including in Northern Ireland.”
If the Prime Minister and the Government want to make that very clear, they should have absolutely no problem with backing our clarifying new clause.
I hope that the Minister will agree with the principles behind new clause 5: that democratic consent must be sought in all parts of the United Kingdom, as set out in Government new clause 1; that we must ensure that the UK’s internal market continues to function effectively; and that, if the Stormont brake is pulled, it should also be pulled in Great Britain. That is the purpose of new clause 5.
Aphra Brandreth
I rise to make a few points in support of the new clause, because I strongly believe that the Bill must uphold and not undermine the integrity of the United Kingdom and the strength of our internal market.
First and foremost, we voted as a country—as the United Kingdom—to leave the European Union. Of course, the unique situation of Northern Ireland, sharing a land border with the EU, has added complexities to that process, but through the hard work of the previous Conservative Government, we secured the Windsor framework, an agreement that represents a careful balance. The framework upholds free-flowing trade within the UK while, crucially, protecting Northern Ireland’s position in the Union, safeguarding its sovereignty and upholding the Good Friday agreement, which remains the foundation of peace and stability.
Before addressing the specifics of the new clause, I will briefly reflect on the importance of the UK internal market, which is the economic spine of our Union, supporting the free movement of goods, services, capital and people across all four nations. Intra-UK trade has been worth up to £200 billion a year, which represents nearly 6% of our GDP. For Northern Ireland alone, it is up to £14 billion annually—twice its trade with Ireland and the wider EU combined. That should serve as a reminder of just how critical it is that we preserve and strengthen Northern Ireland’s place in our internal market. The new clause is a small but significant step toward doing just that.
Northern Ireland is an equal member of the Union. It is only right that its representatives have a meaningful say in decisions that affect them, and that we treat their concerns with the same seriousness that we would those of any other part of the UK. The new clause reflects that principle. It would not tie the Government’s hands unnecessarily, but it would ensure that any action taken respects the processes of the Windsor framework and honours the spirit of consent.
We have spent a good deal of time in Committee debating the balance of powers between Parliament and Ministers. In that context, the new clause is not a radical demand. It simply asks the Government to pause and consider the democratic expression of the legislature of Northern Ireland before acting. It may be that the provision need not be used, but if the Government cannot support it, that would be another indication of their willingness to listen to Brussels over Belfast.
I urge Government Members to join the Opposition in supporting this reasonable suggestion. It would make the Bill stronger, more balanced and more in keeping with our shared commitment to the Union. As Conservatives, we have a proud record of championing the Union, and it was a Conservative Government that delivered the Windsor framework. I did think that Labour was supposed to be Unionist party, not a European Unionist party. This is a chance for Labour to make its position clear.
Alison Griffiths
Those were wise words from my hon. Friend the Member for Chester South and Eddisbury. New clause 5 states that Great Britain should not implement EU laws rejected by Northern Ireland under the Stormont brake. Under the Windsor framework, Northern Ireland retains a mechanism to object to the application of new EU law, but under Labour’s Bill, there is nothing to prevent the very same laws being imposed in England, Scotland, or Wales, even after they have been blocked in Belfast. That is illogical, inconsistent, and constitutionally incoherent.
New clause 5 resolves this by saying that if Northern Ireland activates the Stormont brake on an EU provision, the Secretary of State must pause for thought before applying it to Great Britain. It is not an attempt to hand Northern Ireland a veto over GB law; it is a call for parity of esteem. If something is deemed unacceptable for part of the UK, we surely owe the whole country a pause for thought. It will also serve as a practical brake on the quiet reimportation of EU law into our domestic system, by reminding Ministers that we are one United Kingdom, and that alignment by stealth undermines both sovereignty and the Union itself.
Alison Griffiths
I thank my right hon. Friend for putting a vital point on the record. New clause 5 reflects a commitment to coherent governance, to the integrity of the UK, and to a regulatory system that respects the voices of all four nations. I urge Ministers and the Government to back it.
We must consider the broader economic implications of our relationship with the EU single market. Post Brexit, UK goods exports to the EU have declined, with some studies indicating a reduction of up to 30% compared with a scenario where the UK remained within the single market and customs union. The downturn is largely attributed to non-tariff barriers such as increased paperwork and regulatory divergence, which have disproportionately affected small and medium-sized businesses. The Windsor framework, while aiming to address some of these issues, has introduced complexities of its own: notably, the creation of an Irish sea border has led to significant concerns among Unionist communities in Northern Ireland.
The leader of the Traditional Unionist Voice, the hon. and learned Member for North Antrim (Jim Allister), has been vocal in his criticism, describing the new parcel regulations as tightening the noose of the Irish sea border on local businesses. He argues that these measures further entrench a divide between Northern Ireland and the rest of the UK, undermining the Union and placing additional burdens on commerce. His stance highlights the ongoing tension between regulatory alignment with the EU and the desire to maintain the UK's internal market integrity. The imposition of EU standards on Northern Ireland, without equivalent application in Great Britain, creates a disjointed regulatory environment. This disparity not only affects businesses but fuels political discontent and challenges the coherence of our Union.
New clause 5 serves as a necessary safeguard. It ensures that any EU regulations paused in Northern Ireland due to the Stormont brake are not automatically implemented in Great Britain without due consideration. This approach promotes consistency across the UK and respects the principle that all constituent nations should have a say in the laws that govern them. By adopting new clause 5, Labour would renew their commitment to a united and sovereign United Kingdom, where all regions are treated with equal respect and consideration in the legislative process.
Justin Madders
As Opposition Members have articulated, the new clause would provide for a delay to the Secretary of State’s implementation of regulatory changes in Great Britain where Northern Ireland Assembly Members provide notification of triggering the Stormont brake on similar regulatory changes in Northern Ireland. That delay would persist until the Government make a determination on that notification.
I am sorry that Opposition Members feel that the Windsor framework is not up to scratch any more, but we take our responsibilities under it extremely seriously. The Bill does not alter or restrict the Windsor framework scrutiny mechanisms given to the Northern Ireland Assembly. The shadow Minister questioned the Prime Minister’s commitment to Northern Ireland, and I would remind her that he was in fact Director of Public Prosecutions in Northern Ireland for a number of years before his election to this place.
If the new clause were accepted and the Stormont brake were triggered by the Assembly on a particular EU regulation, it would delay the Government from providing certainty on the regulatory approach that we might take and it would cut across the devolution settlement, none of which is the intention of the Bill. The Stormont brake is about EU regulations, but this new clause would prevent UK Ministers from legislating on our own rules, which I am sure is not the shadow Minister’s intention.
It is also worth saying that the new clause, as drafted, is inoperable. It refers to the incorrect provisions giving effect to the Stormont brake, which are contained in schedule 6B to the Northern Ireland Act 1998.
Again, we have had an awful lot of talk about the EU. We have had a little ride on the ghost train, and nothing that Opposition Members have said bears any relation to the reality of what is in this Bill. I therefore ask that the new clause be withdrawn.
Dame Harriett Baldwin
I think I heard the Minister say that, were the Northern Ireland Assembly to pull the Stormont brake, the Secretary of State would potentially continue to apply EU regulation in GB under the powers in this Bill. If that is what I heard the Minister say—I think it is definitely what he said—it is important that I press the new clause to a Division.
Question put, That the clause be read a Second time.
The Chair
With this it will be convenient to discuss new clause 7—Review of Access to Testing and Certification for SMEs—
“(1) The Secretary of State must undertake a review into the accessibility and affordability of independent product testing and certification, as far as it relates to requirements imposed by or under this Act, for small and medium-sized enterprises (SMEs).
(2) The review must consider—
(a) the costs incurred by SMEs in meeting relevant testing and certification requirements;
(b) the availability and capacity of accredited testing providers serving SMEs;
(c) any barriers to market access arising from testing and certification obligations; and
(d) potential non-financial measures to support SMEs in meeting compliance requirements.
(3) The Minister must publish a report on the findings of the review, including any recommendations, within 12 months of the commencement of this section.”
This new clause would require the Government to undertake a review into the accessibility and affordability of independent product testing and certification for small and medium-sized enterprises (SMEs) in relation to the requirements of this Act.
Clive Jones
New clause 6 has been grouped with new clause 7, and rightly so. Both are driven by the common goal to deliver meaningful support for our Great British small and medium-sized enterprises.
SMEs are the backbone of our economy—engines of innovation and growth that employ millions of people across the UK. Successive financial and administrative barriers have been allowed to accumulate, holding them back. Under this Government, small business confidence has fallen to its lowest point since the first quarter of 2020. The product safety measures enabled by the Bill have the potential to deliver real improvements for consumers, but the reality is that smaller firms do not have the legal or compliance resources that larger businesses can draw on. That is why, as proposed by new clause 6, it is vital that the Government provide specific and accessible support to help small businesses understand what is expected. Ultimately, the new clause is about making the legislation work for everyone, not just for those with in-house legal teams or significant compliance budgets.
New clause 7 seeks a similar purpose. Testing and certification are essential for ensuring product safety and regulatory compliance, but they can be a significant cost for a small business. To take just one example, the British Toy & Hobby Association informs me that an electrical toy must undergo no fewer than 37 separate tests to achieve compliance. There is no single standard test, and the costs can range from £1,000 to £10,000. A significant cost is attached to these essential tests, which is why a review is important.
The tests are critical, but they also represent a significant financial burden, which is why a review matters. It recognises that SMEs often face disproportionate costs and access barriers when attempting to meet the same regulatory standards as their larger competitors. Can the Minister reassure the Committee that his Department will provide clear and proactive support for small businesses navigating the regulatory changes introduced by the Bill?
Mr Holden
It is a pleasure to serve under your chairmanship, Ms Vaz.
These small but practical new clauses would help small and medium-sized businesses, so I hope the Minister will acquiesce to the Liberal Democrat motion, which will be supported by Conservative Members. New clause 6 would ensure the publication of simple and clear guidance for SMEs on day one of the Bill becoming law, to be updated every time new regulations are made. Such guidance would set out the key provisions of the Act, provide practical advice and list the available support and contact details for further assistance. New clause 7 would require the Secretary of State to conduct a review of the accessibility and affordability of independent product testing and certification for SMEs, helping to consider the costs, availability of providers and market access barriers.
SMEs often lack the compliance resources of larger corporations. The previous Government’s £4.5 billion advanced manufacturing plan and broader support for British innovation demonstrated our commitment to helping small and medium-sized businesses to grow and compete. The current Government say they want to help such businesses grow and compete, and new clauses 6 and 7 would be practical measures to help them do just that.
Small and medium-sized businesses are the backbone of our economy and are important drivers of innovation and export growth. New clauses 6 and 7 would give them a fighting chance to innovate without being buried in red tape. I urge colleagues to support both new clauses as sensible and practical improvements.
Alison Griffiths
I have spoken in opposition to the Bill as someone with more than 30 years of business experience in organisations of every size, including SMEs. New clauses 6 and 7 underscore the fundamental flaws and overreach of this Bill.
New clause 6 proposes that the Secretary of State should produce and maintain guidance for small and medium-sized enterprises on how to comply with the Bill’s provisions. New clause 7 similarly calls for a review of access to testing and certification for SMEs.
At first glance, the new clauses may seem helpful, but they raise a fundamental question: why is that level of bureaucratic scaffolding necessary in the first place? The Bill is convoluted, overly centralising and inherently burdensome. It gives the Secretary of State sweeping new powers to regulate, without sufficient parliamentary scrutiny or consideration of local and devolved voices. It introduces layers of compliance that risk choking innovation and enterprise under a mountain of red tape.
Justin Madders
I thank Committee members for their contributions on this group of amendments. The Government are committed to supporting businesses and growing the economy.
New clause 6 would specify that the Secretary of State must produce and maintain guidance for small and medium-sized enterprises on how to comply with any provisions made by regulations under the Bill. I say to the Liberal Democrat spokesperson, the hon. Member for Wokingham, that I welcome the intent behind the amendment. It is vital that businesses, particularly SMEs, understand and have good notice of any new legal requirements, to allow them to take timely action. In the other place, the Government introduced a statutory duty to consult before making regulations. That will ensure that SMEs and other stakeholders are involved, at an early stage, in helping to shape any regulations.
The Government already provide online guidance to help businesses understand new and existing legal requirements, and any actions that they must take. Ministerial colleagues, my officials and I regularly meet businesses. Hearing from them directly is vital to make sure that our regulations protect consumers and support growth. I have outlined how the intent of new clause 6 is already being met, and we will continue to work closely with SMEs as they are of course a crucial part of the economy. I respectfully suggest that the new clause be withdrawn.
The hon. Member for Bognor Regis and Littlehampton described the Bill as “convoluted,” yet earlier she described it as “skeletal.” I hope she eventually decides her position on the Bill. She seems to be suggesting that we should not legislate at all in this area. The idea of having no legal structure for product safety and metrology is, I think, very dangerous. It is important to protect consumers and to ensure a level playing field for businesses, both of which we are doing with this Bill.
Justin Madders
Of course, that is exactly what we are doing with the requirement to consult as part of the amendments agreed in the other place.
New clause 7 would require a review of the accessibility and affordability of independent product testing and certification for SMEs under the Bill. As I have outlined, the Government already consider the impact of new regulations on relevant stakeholders, including SMEs. We outlined how we will do that in the recently published code of conduct, to which we have referred on several occasions.
The code of conduct details the requirements that the Secretary of State must undertake to ensure that the impacts of any changes are properly considered and reported, including by developing appropriate impact assessments. The better regulation framework is a system that the Government use to manage the flow of regulation and understand its impacts. These assessments will, of course, include the impact of regulations on SMEs as well as other businesses.
We will continue to engage with stakeholders, including SMEs, on any new regulations made under the Bill. As product development continues to evolve, this ongoing approach is likely to be more impactful than any one-off review, as suggested by new clause 7. I hope that the Liberal Democrat spokesperson, the hon. Member for Wokingham, is sufficiently reassured by what I have said to withdraw new clause 6. I also hope he will accept our assurance that we will continue to engage on these important matters as we move forward.
Clive Jones
I thank the Minister for his response, but I am pretty disappointed that the Government are unwilling to take this very modest yet meaningful step to support our small businesses. These new clauses are about removing barriers that prevent small businesses from competing on a level playing field.
Question put, That the clause be read a Second time.
Clive Jones
I beg to move, That the clause be read a Second time.
It is a pleasure to speak in support of new clause 8, which seeks to level the playing field between online marketplaces and our bricks-and-mortar retailers. Online businesses have so many advantages in the marketplace, making it hard for our high streets to flourish against such competition. The new clause seeks to close those accountability gaps and ensure that consumers are properly protected and compensated when things go wrong. Crucially, it allows for the extension of liability to online marketplaces in the digital economy, where platforms such as Temu, TikTok Shop and Vinted are growing by more than 20% this year alone. That accountability is urgently needed.
When unsafe products are sold online, the lines of responsibility are often blurred. A survey by Electrical Safety First found that 30% of consumers cannot distinguish between an online retailer and an online marketplace, and yet 70% trust these platforms to protect them from unsafe products. That example highlights the need for strong regulation of online marketplaces to bridge the gap between consumer awareness and product safety regulations. The provision would ensure that online intermediaries could not escape responsibility simply because they did not manufacture the product themselves. Platforms are not delivering the changes necessary to protect UK consumers, so measures must be placed on them to ensure that they are responsible for product safety requirements.
Under the current system, Electrical Safety First recently identified 29 active listings for batteries that had been linked to serious incidents, despite an existing withdrawal notice. British consumers are put directly at risk of fires that can take their possessions, livelihoods and loved ones, and the existing enforcement regime cannot keep up. There needs to be accountability. It is not just electrical goods that pose a risk, but toys as well. The British Toy & Hobby Association has independently tested 650 toys bought through online marketplaces from third-party sellers during the last seven years. On average, it found around 90% of those toys to be non-compliant with UK regulations and standards, putting children at risk of choking, strangulation and electrocution.
The new clause would also enable the disclosure of evidence in cases where someone seeks compensation for harm caused by a defective product. That is vital for consumers, who often lack resources and lack access to information held by large platforms or distributors. The online marketplace can feel like the wild west. It is time to bring the law up to speed and ensure that consumer protection is not left behind in the digital age. Consumers want assurances that they have legal redress and consumer protection if it is needed. If a product causes harm, someone must be responsible, and consumers must have a clear, realistic path to justice.
The Government have indicated that liability will be addressed elsewhere. Can the Minister confirm what legislative vehicle will be used, and on what timeline? What mechanism do the Government anticipate using to address the liability of online marketplace providers? Could the Minister publish their plans before the next stage of the Bill? If the online marketplace regulations are to be made prior to addressing the position on liability, we need some analysis of what consequential changes might be required to those regulations. Are the Government considering that?
Aphra Brandreth
The new clause touches on the important issue of the safety and accountability of products sold through online marketplaces. In today’s consumer environment, the shift towards online purchasing has transformed the landscape. That has brought convenience and choice, but it has also introduced new risks that were not foreseen when our existing consumer protection laws were drafted.
Conservative shadow Ministers and colleagues have met with product safety organisations, and we recognise the real concerns that have been raised. The number of unsafe goods entering the market is deeply troubling. Recent investigations have found that 85% of toys tested from online marketplaces were unsafe, and that nearly 90% of products entering the UK fail basic safety tests. Those are not abstract figures; this is about the health and safety of our constituents. As the hon. Member for Wokingham said, some of the risks to children from unsafe toys are serious and extremely worrying.
Particular concerns have been raised about dangerous incidents involving lithium batteries in e-bikes and e-scooters, which have led to fires, injuries and, tragically, deaths. These are serious and growing risks that demand serious attention. It is therefore right that online marketplaces take greater responsibility in this space. We expect the platforms to remove unsafe products swiftly, co-operate fully with enforcement authorities and ensure that robust safety checks are in place before products are ever listed.
At the same time, we must approach this matter in a proportionate and measured way. The Bill gives the Secretary of State powers to regulate, and it is appropriate that the powers are flexible and future-facing. We must ensure that regulation supports consumer confidence without stifling innovation or imposing undue burdens on small and emerging businesses, particularly those that are trying to compete fairly in a complex marketplace.
A safer marketplace benefits everyone. It is the foundation of consumer trust and business growth: if consumers feel confident that unsafe products are being properly policed, they are more likely to engage in the marketplace, and that in turn supports a vibrant and competitive economy. There is a clear need for ongoing scrutiny in this area, and I look forward to hearing from the Minister about how these important issues will be addressed as we take the Bill forward.
Justin Madders
I recognise the important points made by hon. Members in this debate. This issue is being actively considered. Liability for damage caused by defective products is an important area of law, and we agree that there is scope for improvements to the legislation—or modernisation, if we want to describe it in that way—but they need to be made in a considered way.
As hon. Members have said, technological advancements and the development of new supply chains since the passage of the Consumer Protection Act 1987 indicate the breadth of change since our liability regime was last updated. We therefore need to carefully consider the range and types of products that should now be in scope of liability claims, as well as who should be liable.
It is important to note that one of the reasons why we cannot accept the new clause is that product liability extends beyond products in scope of the Bill—for example, it covers food and medical devices—so an alternative legislative vehicle may be more appropriate for making updates in this area. I can confirm to the Committee that we have asked the Law Commission to conduct a full and comprehensive review of product liability legislation and make suggestions for reform. We expect the commission to report back next year, and we will legislate if necessary to ensure that product liability laws are up to date and fit for the future.
I hope that reassures hon. Members that we are alive to this issue and actively taking steps to ensure that when we update legislation, we consider the myriad developments in the world.
Clive Jones
I thank the Minister for his response. Consumers deserve real protection, not promises of future legislation. If online marketplaces continue to evade liability, unsafe products will slip through the cracks and consumers will pay the price. I therefore intend to press the new clause to a Division.
Question put, That the clause be read a Second time.
Clive Jones
I beg to move, That the clause be read a Second time.
When the Bill was announced in the King’s Speech last summer, it held real promise of an intention to address the growing number of fires caused by lithium-ion batteries in e-bikes and e-scooters. However, there remains no reference in the Bill to lithium-ion batteries, despite the real and growing harm they cause. This is what new clause 10 seeks to address. According to Electrical Safety First, more than 180 parliamentary constituencies have experienced a fire caused by unsafe lithium-ion batteries since 2020. The evidence is clear that these batteries require a more robust regulatory response. This is not just about consumer protection, although that is vital, but about environmental responsibility. Lithium-ion batteries contain hazardous materials, and poor disposal poses real environmental risks.
The Government have so far accepted an amendment to the Bill that implements a system for classifying high-risk products and applying appropriate regulations. I am sure Members agree that lithium-ion batteries can, and should, be classed as high-risk, and I hope that this amendment is protected as the Bill progresses through its remaining stages. If the Government intend to classify these batteries as high-risk, there is no harm in putting that into primary legislation. I would be grateful if the Minister could share what work is ongoing in his Department and the Department for Transport to deal with e-bike and e-scooter batteries.
Dame Harriett Baldwin
I thank the hon. Member for Wokingham for moving the new clause and giving the Committee the opportunity to hear from the Government on this issue.
The matter was raised extensively during proceedings on the Bill in the other place, and in the evidence that the Committee has received from members of the public and important public bodies, including fire services across the UK. It would be interesting to hear from the Minister about the existing scope in UK law to regulate lithium-ion batteries, as well as the power that the Bill gives the Minister to address a product that all too often causes horrendous fires. Many of our constituents will have heard of or have been affected by this issue, so I look forward to hearing from him.
Justin Madders
It is right that hon. Members have raised this matter, which is one of the primary drivers behind the Bill. We recognise that the safety of products containing lithium-ion batteries is an increasingly pressing issue, and I welcome the opportunity to speak about what the Government are doing.
We are fully aware of the risks that are posed, particularly by products such as e-bikes and e-scooters, and we have already taken meaningful steps to protect consumers and uphold product safety standards. The Office for Product Safety and Standards has worked closely with colleagues across Government, industry partners and technical experts to identify the root causes of the safety issues that we are seeing. That includes addressing faulty design, poor manufacturing standards and issues with battery compatibility and charging systems.
Alongside regulatory oversight, we have engaged directly with UK businesses to help them to comply with existing safety regulations. We want to ensure that good businesses who act responsibly are not undercut by unscrupulous traders who place unsafe products on the UK market.
We have also built strong relationships with fire and rescue services, which are often the first to see the consequences of battery failures in the home or in public spaces. Their expertise and intelligence-gathering skills have been instrumental in helping us to identify high-risk products and take appropriate enforcement action.
Since 2022, these efforts have resulted in 20 product recalls and 22 enforcement actions targeting unsafe or non-compliant e-bikes and e-scooters. In one notable case, the OPSS issued 26 withdrawal notices relating to two dangerous e-bike battery models manufactured overseas by Unit Pack Power. Those batteries had been linked to incidents investigated by fire and rescue services, and action was taken to halt their sale across eight online marketplaces, as well as against two manufacturers and 16 individual sellers.
However, we recognise that enforcement alone is not enough. Regulatory reform is needed to ensure that harmful products are stopped at the border or prevented from entering the market in the first place. At the same time, we must avoid placing disproportionate burdens on responsible businesses. Regulation must be effective, proportionate and targeted. This will protect the public without stifling innovation or fair competition.
The Bill has been drafted to provide those powers across a wide range of product categories, including lithium-ion battery products. While I fully recognise the concerns raised about batteries, the Bill does not and should not single out individual product types. To do so would risk narrowing its scope and limiting our ability to act effectively across the product landscape, including when new products are introduced. I think we all understand how technologies are evolving and that we need broad powers to keep up to date.
A requirement to report in three months would cause some challenges for timelines. There is normally a 12-week period for Government consultations, and that would obviously not fit into the three months suggested by the new clause.
At this stage, we are actively exploring what regulatory changes might make the greatest difference on lithium-ion batteries. To support that, the Department commissioned research from the Warwick Manufacturing Group to deepen our understanding of the risks posed by these batteries, including issues of compatibility, design and failure patterns. This research has now been published—I am happy to provide a copy to the hon. Member for Wokingham if he wishes to see it—and will help us to identify where interventions are most needed through regulatory standards, clearer compliance pathways or improved consumer guidance.
I reassure the hon. Gentleman that we are committed to tackling the safety challenges associated with lithium-ion batteries. We will continue to work closely with all stakeholders—from industry to fire services, and from standards bodies to consumer groups—to develop solutions that are effective, evidence-based and proportionate.
We understand the urgency of the issue. I have met victims of lithium-ion battery fires, and they understand that we are doing everything we can to get the measures on the statute book so that we can develop regulations to prevent such tragedies from happening again. It is important that we recognise new dangers and act to protect the public. I hope the hon. Gentleman is reassured that we will take action and are doing what we can at this stage.
Clive Jones
I thank the Minister for his response and the hon. Member for West Worcestershire for her remarks. The Government accept that the batteries are high risk—which is welcome—so why not name them in the Bill? Consumers, firefighters and local authorities all want clarity and action. If the Bill is not the right vehicle, what is, and when will we see it? I intend to press the new clause to a Division.
Question put, That the clause be read a Second time.
Clive Jones
I beg to move, That the clause be read a Second time.
The new clause aims to ensure that online marketplaces are subject to clear, enforceable duties to protect consumers against unsafe products. Despite online marketplaces playing a central role in today’s retail environment, they often operate without the same responsibilities as traditional retailers, despite facilitating the sale of millions of pounds of goods to UK consumers.
The new clause would put some common-sense requirements on online marketplaces. For example, it would require platforms to have effective systems in place to monitor and detect unsafe products and block them from being sold, and it includes a clear duty to remove unsafe products quickly once a risk has been flagged. Those basic consumer protection principles are applied to bricks-and-mortar retailers, so why not to online retailers? No platform should be able to profit from unsafe goods while claiming that it has no responsibility for what is sold.
The current system simply is not working: 85% of the toys tested by the British Toy & Hobby Association, across 11 online marketplaces, failed toy safety testing and were delisted from sale. Despite that, it found that 72% of seemingly identical unsafe toys were back on sale, with 41% being sold by the same retailer. On testing a sample of 25 of the toys, all 25—100%—failed toy safety testing.
As we modernise our product safety regime, we must ensure that online marketplaces are held to the same high standards as bricks-and-mortar shops. Bricks-and-mortar toy retailers are expected to deliver much more, with fewer resources. Some 80% of UK toy retailers are SMEs. If they want to supply a manufacturer’s product, they are obliged to ensure that the manufacturer has carried out the relevant compliance regulations. Additionally, importers have certain obligations and have to ensure that others have been carried out. Online marketplaces are not required to do any of this.
Meanwhile, third-party sellers are often able to evade compliance with safety regulations, as online marketplaces have no obligation to verify that those sellers have met their legal responsibilities. Third-party sellers are often difficult or impossible to trace for enforcement. This means the cost of producing their toys is lower, so third-party sellers are able to sell their products more cheaply. The new clause would deliver fairness and essential protections. By embedding baseline requirements directly in primary legislation, the Bill will close regulatory gaps and ensure that secondary legislation can build on a solid foundation.
Before I conclude, another issue that needs to be addressed is counterfeit products. Because of a lack of traceability and enforcement, many products sold in online marketplaces are counterfeit, leaving British consumers at risk of substandard goods that pose a risk to their health and waste their money. What are the Government doing to stop that? What steps has the Minister taken to ensure that there is a level playing field between the high street and online marketplaces? Will he meet me to discuss the matter further, with the British Toy & Hobby Association?
Dame Harriett Baldwin
I thank the hon. Member for Wokingham for raising this incredibly important and wide-ranging issue. He touched on some of its growing importance in the UK, where consumers are buying more and more products online. The hon. Gentleman brings his valuable expertise from the toy and hobby sector to the discussion. Above all, we would be particularly concerned if harmful toys were to find their way to consumers, and indeed they do. Some 80% of the toys purchased from online marketplaces that were tested by the British Toy & Hobby Association were found to be illegal due to missing warning signs.
As this issue has been included in the Bill, I know that the Government intend to use this legislation to deal with it. From the many speeches made on Second Reading, I know that this subject exercises colleagues across the House. I look forward to hearing from the Minister how he will use the powers in the Bill to deal with this important issue.
Justin Madders
I thank the hon. Member for Wokingham for moving the new clause, which would require the Secretary of State to introduce a list of duties on online marketplaces and to make a statement within three months of Royal Assent.
As Members have recognised throughout the debate, online marketplaces now play a significant role in the supply chain and must be explicitly recognised in the product safety regulatory framework. We all recognise that they provide consumers with greater choice and convenience, but of course that cannot come at the cost of compromised consumer safety and of disadvantaging compliant businesses, so I recognise and share the new clause’s intent.
However, some of the requirements in the new clause are of the type that the Government are developing for consultation and will thereafter introduce using the Bill’s powers. We intend to introduce requirements that build on best practice to create a proportionate regulatory framework where online marketplaces: take steps to prevent unsafe products from being made available to consumers; ensure that sellers operating on their platform comply with product safety obligations; provide relevant information to consumers; and co-operate closely with regulators. The framework will also include, if necessary, powers to deal with stolen or counterfeit products, as the hon. Member for Wokingham mentioned.
The Bill provides the opportunity to develop requirements following consultation—as required by clause 12(6)—stakeholder engagement, impact assessments and consideration of the practical implications, including whether requirements should be tailored to specific business activities to ensure proportionality. The new clause, however, would require the introduction of its specified obligations irrespective of the outcome of any consultation or impact assessment, and of consideration of whether that would be proportionate or effective across the range of online marketplace models.
We expect the diversity and market share of e-commerce to continue to grow, and the ways that UK consumers purchase products to evolve in ways that we are not yet able to predict. It is therefore important that the product safety legal framework remains flexible, so that it can adapt to future changes while remaining proportionate for different business models. I am afraid that the new clause would significantly hinder that flexibility by mandating that online marketplaces’ duties must include requirements relating to those in the new clause.
I assure the hon. Member for Wokingham that our intent is to introduce, at the earliest opportunity, new regulations on online marketplaces that are proportionate and future-proof and that prioritise consumer safety. The regulations will of course be informed by public consultation and subject to the affirmative procedure. I am happy to meet the hon. Member to discuss this issue further, because there is an important role moving forward. I am happy to engage with Members in all parts of the House to ensure that we get it right. In the meantime, I ask him to withdraw his new clause.
Clive Jones
I thank the Minister for his response and for agreeing to meet me. I hope he will be happy if I bring along the British Toy & Hobby Association, because it will have a wealth of evidence for him.
I reiterate that 85% of tested toys failed toy safety standards, yet those products still reach children through online marketplaces with little or no accountability. How is that defensible? Bricks-and-mortar toy shops face far stricter obligations. There is not a level playing field and it is not safe. I intend to press the new clause to a Division.
Question put, That the clause be read a Second time.
Clive Jones
I beg to move, That the clause be read a Second Time.
The Government can legislate all they like, but if local law enforcement bodies such as trading standards are not properly funded or supported, laws risk becoming paper promises rather than practical protections. A large share of responsibility for the areas within the scope of the Bill, including product safety enforcement, falls to trading standards services within local authorities, which is why we tabled new clause 13. We want to ensure that trading standards authorities have the resources, skills and capacity they need to enforce the regulations created by the Bill.
The capability and capacity of trading standards to enforce not just this legislation but a wider body of trading standards and consumer protection law is vital. The point is simple: effective enforcement is the backbone of consumer confidence and fair trading, but local trading standards teams are stretched, under-resourced and often unable to respond to the volume and complexity of modern marketplace issues. The Chartered Trading Standards Institute says that spending on trading standards services has been cut by more than 50% over the past decade, and that staffing levels have fallen by 30% to 50% over the same period. Overall, trading standards services are frequently unable to fulfil their duties and have very limited ability to make the changes needed to address new harms in the UK’s increasingly digital economy.
Dame Harriett Baldwin
On Tuesday, on multiple occasions I made the point about how widely the Bill is drawn in terms of the bodies responsible for enforcement. I have a lot of sympathy with the hon. Member for Wokingham’s points about a trading standards enforcement review, which we think would be an important part of the ongoing scrutiny of the Bill’s impact, so we are minded to support the new clause.
Justin Madders
I thank the hon. Member for Wokingham for moving his new clause, although he is pushing his luck asking for another meeting straight off the back of his previous speech. We absolutely recognise the crucialness of the enforcement work done by local authorities. It has become clear that the existing framework of layered, complex legislation is part of the problem—part of the drain on resources—and one of the reasons why the Bill is necessary.
The selective implementation of new tools such as civil monetary penalties should further assist in providing more proportionate routes for enforcement authorities to use their enforcement activities, which the Bill addresses. Clause 8 enables the implementation of cost-recovery powers for relevant authorities, and the Office for Product Safety and Standards, in its role as national regulator, supports local authority enforcement teams with training, access to experts, direct support on cases and ringfenced funding for specific projects.
The regulator has a dedicated function in respect of communication with local authorities and takes its role extremely seriously. It will provide support on nationally significant cases if local authorities are faced with unco-operative businesses, be they existing supply chain actors or new ones. [Interruption.] Was that a request for an intervention? Perhaps it was agreement.
Local authority enforcement is a much broader area of consumer protection than product regulation, which is of course the scope of the Bill. This legislation is not the right vehicle for a review because it is singly focused on product regulation, whereas local consumer protection is a much broader policy area. I invite the hon. Member for Wokingham to withdraw his new clause.
Clive Jones
I thank the Minister for his response. I am disappointed that he is not willing to back the new clause, which simply asks for transparency about enforcement capacity. Trading standards cannot enforce laws. It does not have the people or funding for it, and right now it is being asked to do more with less. The Bill risks being toothless without the resources to back it up. I intend to press the new clause to a Division.
Question put, That the clause be read a Second time.
Justin Madders
On a point of order, Ms Vaz. As we are at the end of our deliberations in Committee, I thank you and Sir John for your exemplary chairing. We have finished in good time, but we have had extensive debate on a number of matters pertaining to the Bill. I thank the Clerks and the officials from the Department who have helped proceedings to go smoothly. I thank all Committee members for taking part in deliberations—no doubt we will hear from some of them again on Report.
Dame Harriett Baldwin
On a point of order, Ms Vaz. I am grateful for the opportunity to thank you for chairing, and Sir John for chairing Tuesday’s morning sitting. I thank the Committee members, particularly the Minister and his officials for their engagement on the important issues that have been raised, and I thank my colleagues. In order to get her name into Hansard, I thank Eleanor Munro from my office, who has been heroic in supporting me during the deliberations. I look forward to continuing our discussions on Report. I also thank the Clerks.
The Chair
I add my thanks to all right hon. and hon. Members for their assiduous scrutiny of the Bill. I thank all the officials, the Doorkeepers, the Clerks and Hansard.
Bill, as amended, to be reported.