HL Deb 07 January 2003 vol 642 cc986-1008

9.41 p.m.

Lord Crickhowell

rose to move, 'That this House takes note of the Report of the European Union Committee on Reducing the Risks: Regulating Industrial Chemicals (13th Report, HL Paper 81, Session 2001–02).

The noble Lord said: My Lords, I must say that at this late hour I am rather tempted to move that the House do now adjourn until 2.30 p.m. tomorrow. But I think that might cause hysterics on the Government Front Bench. I do not want to do that.

However, I must say that I do not think it is satisfactory that we have had to wait 11 months since publishing this report, and now have only an hour or so at this very late hour to debate matters of great importance concerning human health, the environment, the chemical industry and programmes of testing using vast numbers of live animals.

Because my noble friend Lord Selborne, the chairman of Sub-Committee D is also chairman of the UK Chemical Stakeholders Forum, I was asked to chair this particular inquiry; but I am thankful that we continued to benefit from my noble friend's enormous knowledge of the subject. I also want to express my thanks to our special adviser, Mr Nigel Haigh, and to our Clerk, Mr Tom Radice, for their invaluable contributions.

The debate comes at a moment when it may still be possible to influence the nature of proposed legislation designed to regulate the manufacture, marketing and use of a very large number of industrial chemicals. That there is a need for legislation is really unarguable. The UK Government in their 1999 Chemical Strategy say that they are, very concerned that we do not have even a basic assessment of the possible risks of most chemicals released into the environment in large quantities". The European Commission published its White Paper Strategy for a Future Chemicals Policy in February 2001. It stated that, the lack of knowledge about the impact of many chemicals on human health and the environment is a cause for concern". The UK Chemicals Industries Association, fully supports the key health and environmental goals of the proposed legislation", although it is critical on method and detail.

In June 2001 the Environment Council welcomed the White Paper as "an important first step", reaffirmed its commitment to the development of a new chemicals policy, but called for further work, emphasising the need for, "streamlined, practical and effective procedures", which are "realistically achievable"; and called for the Commission to present its proposals by the end of 2001.

A number of task forces were established to work on problem areas and the target date for more detailed proposals slipped to mid 2002. Judging by noises from Brussels, even Easter 2003 may now be an optimistic estimate. There is also a real danger that everything will slip beyond the European Parliament elections in June 2004 with further problems created by enlargement.

The White Paper set a target date of the end of 2005 for the registration of substances produced in quantities exceeding 1,000 tonnes per annum. That target is now almost certainly unachievable. This debate provides an opportunity to emphasise the need for the Commission to move with a greater sense of urgency; and for the Government to indicate their own views on the current timetable.

The starting point is that we appear to have an effective regime for the notification and evaluation of all post-1981 chemicals—approximately 2,700 of them at the time that we produced our report. However, the EU regime for pre-1981 chemicals has generated far less satisfactory information about the 30,000 chemicals produced in quantities of more than one tonne per annum, while only a tiny handful of risk assessments and risk reduction strategies have been published in respect of the 140 existing chemicals that are included in the lists of chemicals requiring immediate attention.

Faced by this clear evidence of failure, the Commission proposed a new regime to be known as REACH, with three main elements: registration, evaluation and authorisation. The idea is that the industry will be required to provide data and preliminary risk assessments for the 30,000 or so old chemicals similar to that produced for the 2,700 marketed since 1981. Manufacturers will have a powerful incentive to submit a complete registration dossier, because failure to do so may result in marketing being banned—an incentive lacking under the present arrangements. There will be much reliance on preliminary assessment by industry, with the authorities evaluating only a minority of assessments, but with authorisation required for chemicals identified as of high concern.

In our report, we expressed great scepticism about the ability to deliver what is a highly ambitious programme with unrealistic timetables and equally unrealistic estimates of the resources required. We suggested that it might be a mistake to move at the outset to a single system that seeks to combine the arrangements for new and existing chemicals. We thought that the new legislation was likely to be complicated and contentious, and that the Commission would be adding to the difficulties if it tried to do everything at once.

In paragraphs 202 to 210, we set out a proposed programme that breaks up the legislative package into phased parts. We urged the Commission to get its priorities right and tackle first the chemicals that provide the greatest risk. We argued strongly that the resources required were being underestimated and expressed grave concern about the huge number of animal tests that would be needed to carry out the programme within the timescale suggested.

On animal testing, we said: The White Paper provides a rare opportunity to generate the political will in the EU to promote non-animal testing. The United Kingdom Government must take a lead in that and should make it clear in the Council that it cannot accept a new chemicals strategy that leads to significantly increased animal testing, since this would be unacceptable to the public and lead to failure of the strategy. The EU chemicals strategy must be linked to an EU strategy for minimising animal testing. The United Kingdom Government is more likely to be successful in pressing this argument if it has its own, well-funded programme for finding alternatives. The delays that have already taken place suggest that we were right to warn of the danger of trying to produce a single, all-embracing piece of legislation instead of building it step by step over time, with the most urgent tasks tackled first. Unfortunately the oracles, in so far as they can be interpreted, suggest that we may have lost that argument.

Whatever is decided in the next critical phase will be important not just for the environment and health, but because of its potential impact on manufacturing industry. In the second paragraph of our report we emphasised that: Manufactured chemicals play a key role in the provision of goods and services on which modern society is dependent, and the chemical industry is Europe's third largest, employing 1.7 million people directly and with up to 3 million additional jobs dependent on it". The Chemicals Industry Association expressed disappointment about what it called our, lack of emphasis on the key competitiveness issues posed by the Commission's proposals, and its omission of discussion of the potential impact on European industry". In fact, we devote a good deal of our report to an examination of competition and world trade issues. In paragraph 147, we identified the many witnesses who argued that imported products must be covered by the new system both to ensure protection of health and the environment and to ensure that EU products remained competitive with finished products originating from outside the EU. We drew attention to WTO issues. In paragraphs 164 to 172, we examine what is happening in the United States and in other OECD countries. We refer to the work being carried out following the UNCED conference in Rio in 1992 and other UN work. We say that, given the global nature of the chemicals industry, we welcome the growing attention of international organisations to chemicals policy and the co-ordination that is taking place. In paragraphs 135 to 145, we examine the real problems posed for downstream users.

Many of those competition points are helpfully picked up in the government paper published on 9th December 2002, which sets out three overarching objectives: Creating a fast, efficient and workable process of testing, screening and assessing chemical substances to provide the information necessary to control those substances of concern, starting with the most harmful, because of their impacts on human health and the environment; keeping animal testing to the minimum necessary to protect human health and the environment; and maintaining and enhancing the competitiveness of the chemical industry". On the last point, the Government emphasise, as we do, the importance of the proposals being consistent with WTO and other multi-national agreements and of seeking a global approach to the management of chemicals. The paper emphasises that the EU chemicals strategy, should encourage innovation and maintain and enhance competitiveness". In our report, we say: The highest priority should now be given to developing two items of legislation: authorisation of chemicals of very high concern; and registration and evaluation of existing chemicals … Whatever scheme of new legislation is brought forward we will only be satisfied if it: speeds the process of identifying chemicals that require risk management, enables risk reduction measures to be adopted without delay following identification, creates a sense of ownership among stakeholders and provides for appropriate post-marketing surveillance". I welcome the fact that, on almost all the crucial issues, there is much common ground between the position adopted by our committee, the position of the British Government and the conclusions of the June 2001 Environment Council.

I conclude by emphasising the importance of speeding up action at home and abroad. The Commission must come forward with detailed proposals, but work on the wider policy must not be allowed to lead to further delay in evaluating the 140 priority chemicals already identified. In this country, the UK Chemicals Stakeholder Forum, under the chairmanship of my noble friend Lord Selborne, does invaluable work identifying priorities and finding practical solutions. There must be equally effective activity by the Environment Agency in producing its too long-delayed chemicals strategy and its promised study of a product register. There must be better coordinated activity by government departments and agencies and an effective system of post-marketing surveilla nee.

Consultation has gone on long enough. Positive action is now required by the European Commission and by the responsible authorities within the United Kingdom. I beg to move.

Moved, That this House takes note of the Report of the European Union Committee on Reducing the Risks: Regulating Industrial Chemicals (13th Report, HL Paper 81, Session 2001–02).—(Lord Crickhowell.)

9.53 p.m.

Lord Livsey of Talgarth

My Lords, in following the noble Lord, Lord Crickhowell, I wish first, as leader of my party in Wales, to pay a brief tribute to the late Lord Jenkins of Hillhead. His background in Wales was a basic background, with which we are all familiar. An aunt of mine always used to say that a brilliant boy had come forward and gone out of our valley to make good. Many did so, through the aspirations of their parents.

Lord Jenkins was a wise, civilised man with a huge, balanced vision. I hope that that is the spirit in which I may address the issues raised in the EU Committee report. I liken him to someone whom I knew, who was blinded in the war but became a main board director of Shell Chemicals. He was a grammar school boy. My uncle was a chemist. I spent the whole of the 1960s in the chemical industry. Therefore, I am well out of date. Unfortunately, I was not a member of Sub-Committee D at the time that this report was published. I joined the sub-committee of the European Union Committee in December. I am particularly happy to welcome back my noble friend Lady Miller of Chilthorne Domer who has not been well but is now back to full health. I am pleased to see her because she will sum up the contents of the report, with which I am not as familiar as I should be.

In view of the background that I once had in the industry, I want to make a number of points. Typically, the noble Lord, Lord Crickhowell, set out the basis of the report. It is only 12 miles from Crickhowell to Talgarth. Indeed, Crickhowell lies in the valley of the Usk and Talgarth in the catchment area of the River Wye. We have seen a number of issues of that type in the chemical industry. I worked on Teesside at one point. I noted that the River Tees was not as clear as either the River Wye or the River Usk. That was because of the preponderance of the chemical industry there.

I note the comments made by the noble Lord, Lord Crickhowell, about the existing scheme since 1981 and the flaws in the 1994 EU regulations, clearly made in this report. Indeed, hardly any risk assessments have been made of the chemicals on the priority list. That is an appalling judgment because 1994 is some considerable time ago.

The EU White Paper proposes a new regime, outlined by the noble Lord, in the REACH proposals. The onus is on the industry to justify the use of chemicals. From a safety point of view, that may not necessarily be the primary consideration of the company concerned. On page 39, the report recommends that classification, packaging and labelling of chemicals and preparations, the registration and evaluation of new chemicals, the registration and evaluation of existing chemicals, the restrictions on marketing in use, and the authorisation of chemicals of very high concern should be addressed. I concur that those recommendations should be contained in any future legislation.

It is desirable that the procedures are streamlined, pragmatic, effective and realistically achievable. However, it is difficult to define the word "pragmatic" in the issue of dangerous chemicals, particularly to human health and the environment. The idea of advocating the transfer of responsibilities to the industry, I believe is probably one which needs closer examination. Risk assessment is complex due to the diverse use of chemicals. As regards the degree of danger of those chemicals, the need for prioritisation is very important.

There is mention of a central entity to administer the control system and the difficulties that that might entail. I believe that there is merit in the conclusions of the report that perhaps a different approach should be taken. However, the whole question of finance and lack of resources is one which demands close attention. A levy with proper controls on bureaucracy may be one of the answers in helping to finance what is clearly an issue which is not properly resourced at present.

Briefly, I turn to one or two of my own experiences in the chemical industry concerning the impact of chemicals. I was involved in the development of paraquat in the 1960s. Many risk assessments were made. It was said that pigs had to eat 15 tonnes of potatoes which had been treated with diquat, its sister chemical, before they died. Unfortunately, one or two humans drank paraquat and diquat neat and died, which was not anticipated.

I visited factories producing chemicals, particularly ammonia which took the skin off my throat and the throats of other people. In those days, employees in chemical plants received a gold watch at the age of 65. Many of them did not reach that age and most were dead 18 months after retiring.

The issue surrounding organophosphates is alarming and needs to be examined in great detail. The spraying of chemicals creates a great deal of illness among operatives because the safety rules are not properly applied. As regards the treatment of seeds, when I was working in a particular situation I saw at first-hand operatives ingesting dust into their lungs. Clearly, they were very ill as a result and their lives were shortened.

The whole issue of sheep dip and its chemical problems is a running sore. When I first used a new sheep dip in 1985 I wondered why I was coughing and spluttering after dipping 250 ewes. On reading the label afterwards, I was horrified to see that it contained OP. It was the first time I had seen the warning and I never used an OP dip again. I have had a great deal of anxiety about the contamination of water courses and the release of sheep dips into them. In a little stream which ran through my smallholding I once found 89 dead trout and had to report the incident to the Environment Agency.

It is vital that the codes are enforced and we must ensure that the wonder chemicals produced to solve many problems are properly vetted and tested. That is vital. I know things have moved on and have greatly improved since the time I worked in the industry. I welcome the report but we must ensure that the whole process is focused, particularly on the most dangerous chemicals. People's lives depend upon it. I want to know, as the report asks, what is the role of the Environment Agency. What can Ministers tell us about that in relation to these chemicals'?

We need an independent body to police the production, marketing and use of chemicals. Indeed, my historical knowledge of the agrochemical industry is that regulation at that time was inadequate. Stakeholders had too much power in the industry over regulation and standards. The result was that although chemicals were registered and tested, controls at the point of use and an understanding of how dangerous they were was inadequate. Post-marketing surveillance, as stated in the report, is vital. In future, the UK Government and EU involvement is essential at a high level and it is important that that is transparent in the interests of all our citizens.

10.3 p.m.

The Countess of Mar

My Lords, I thank the noble Lord, Lord Crickhowell, for giving us the opportunity to debate the report today. I also thank him for his lucid summary of what we did. I was pleased to become a member of Sub-Committee D—I was formerly a member of Sub-Committee C, which became Sub-Committee D. This is right up my street. Those noble Lords who know me well will be aware of my interest in chemicals, although hitherto I have generally confined my interests to the human health effects of exposure to toxic chemicals used in an agricultural context.

I found the inquiry which resulted in the report most interesting, although not very enlightening. Much of the evidence highlighted systemic deficiencies of which I was already aware. For example, several years ago I asked the Veterinary Medicines Directorate, the Pesticides Safety Directorate and the Health and Safety Executive what independent tests would be conducted to ensure the safety of the products they licensed or authorised. "None", was the response. All three organisations rely upon the information provided by manufacturers. The EU White Paper acknowledges that much of the data provided are deficient, particularly for chemicals in use prior to 1981.

There are not even any independent laboratory quality control checks. I was informed that the manufacturers are expected to do their own batch tests, and one manufacturer told me that it would be far too expensive for them to check every batch of chemicals produced. This has meant that when things have gone wrong it has been humans, or flora and fauna in the environment, that have sounded the alarms.

I can understand that there are circumstances when it is impossible for laboratory or field tests to forecast every problem that may arise in practice. What I have always found disturbing is the failure of those responsible for protecting human and environmental health to respond to the distress signals, even, it seems, when they are faced with incontrovertible evidence of harm. Toyber's dictum, which states that the absence of evidence is not evidence of absence, has been ignored far too often.

I am constantly bemused by the extreme lengths to which the precautionary principle is invoked in defence of the current policy relating to scrapie, BSE and CJD, when there is as yet no scientific evidence of any causal link. When a chemical formulation—pure chemicals are rarely put on the market—is claimed to be causing damage to human health, the evidence, we are told, is anecdotal. Any attempt to persuade the manufacturer, the licensing authority or even government Ministers to conduct timely causal research based on the classic principles is strenuously resisted. For some strange reason the precautionary principle is given a different definition when chemicals are the culprits, even when there is scientific evidence of damage caused. Remember how long it took for blue asbestos and DDT to be withdrawn.

I believe that a major handicap has been our own failure to recognise that we have been both unreasonable and unfair to expect those who give permission for a product to be marketed also to be responsible for admitting that they got it wrong. As I have already mentioned, the data supplied during the licensing process are, more often than not, limited. Individual chemicals are tested for various toxic properties but I understand that the safety of the final product is determined only by extrapolation.

Chemical formulations frequently contain what are described as inert ingredients. These, I have discovered, can be very toxic in themselves. Phenols and epichlorohydrin were both inert ingredients in sheep dips. Both were eventually removed from the sheep dip formulations because they are extremely toxic in their own right, but who knows what their effects have been while they were in use? No-one has tested them. In some cases, an inert chemical will have a synergistic or potentiating relationship with an active ingredient. This may not be discovered until problems occur in the field after a prolonged period of use.

The report, at paragraphs 151 to 163, details the evidence the committee saw and heard on the subject of post-marketing surveillance. We expressed our surprise at the lack of co-ordination in monitoring for the presence of industrial chemicals. The witness from the World Wildlife Fund-UK felt that post-marketing surveillance was not a satisfactory means of detecting adverse effects from chemicals. She would prefer that chemicals with unsafe properties did not come on to the market.

Thousands of new chemicals are produced every year. Even I recognise the fact that it would be impossible to prevent any unsafe chemicals from being marketed. We still have much to learn about the way in which humans, animals and plants cope with exposures to new chemical formulations. We are only now learning that some humans are more vulnerable to the effects of some chemicals than others. I suggest that we should be alert to complaints of ill health associated with the use of particular chemicals and that they should be regarded in the same light as miners' canaries—as an early warning system.

When there is a case of food poisoning, all the stops are pulled out until the cause is found. Death can result from food poisoning, but so, too, can it result from chemical poisoning. Why is it that one is given more importance than the other?

I wholeheartedly concur with the committee's recommendation that the Government should develop a policy on post-marketing surveillance for industrial chemicals and in particular that the policy should include the uses of chemicals and effects on users. I should like to see that policy implemented rapidly. I should also like to see the development of a system separate from the licensing authorities for the reporting of suspected adverse effects of exposure to chemicals. In the past I have suggested that environmental health officers would be ideally suited to such a role. They already have the right title. They have the investigative training and experience. Who better?

We still have a very long way to go before we can provide a safe environment. We must not forget that most of the chemicals introduced since the Industrial Revolution have been of great benefit to us; neither must we forget those that have caused enormous harm to humans and to the environment. This report makes wise recommendations. I hope that the Minister will ensure that they are heeded.

10.11 p.m.

Baroness Hooper

My Lords, my interest in this subject first arose when I was a Member of the European Parliament with chemical interests in my Euro constituency. I was also, for a number of years, a non-executive director of a major British pharmaceutical company. Currently, I am an officer of the All-Party Parliamentary Group on the Chemical Industry. Perhaps I can therefore say that I take an informed interest in matters affecting the chemical industry, but I cannot claim to be an expert, as are so many other participants in this debate.

I do know, however, that the chemical industry is one of our few remaining successful industries, providing direct employment for a substantial and highly skilled workforce nation-wide, and it is our top manufacturing export earner.

I am also aware that, in spite of all this success, people working in the industry have a feeling that they are under-valued, unappreciated and regarded as uncaring and concerned only with making a profit. In saying this, I acknowledge that the noble Countess, Lady Mar, who is understandably vigilant and concerned about reducing risk, has to be congratulated on all that she has achieved in bringing defects in the system to light.

The European Union Chemicals Policy Review came as by far the biggest public policy issue to hit the industry in decades. As my noble friend Lord Crickhowell has said, the industry endorses the White Paper's aim of ensuring a high level of protection for human health and the environment. There is full support for this and for the need for a comprehensive system that clearly and openly demonstrates that chemical substances are being used safely, and which replaces the current, rather piecemeal regulatory regime which serves no one's real interests.

In replying, will the Minister answer the following questions? I apologise if I duplicate or overlap with questions raised by other speakers in the debate or which have been raised in the report.

Does the Minister agree that it should be possible to develop a simpler, more focused and more proportionate system to test the safety of those relatively few substances which may be of concern? As has been said, the European Union proposals would mean a hugely expensive and bureaucratic system and the use of millions of animals in an untargeted testing process.

Will the Minister further agree that many chemicals used in production are chemically or physically bonded within final products—for example, plastic articles and rubber tyres? As I understand it, even if in their initial state some chemicals may be hazardous, it does not follow that handling a product made from such chemicals will cause problems. Is it therefore necessary to test a chemical, using animals, which would tell us nothing about its risks when bonded within a product?

Does the Minister agree that the added costs of the REACH proposals would allow foreign imports of products not subject to the same testing procedures, to compete unfairly? Furthermore, does he agree that the effect of these proposals might also encourage further migration of new manufacturing processes to non-European locations? Those concerns and questions have been raised not only by the British chemical industries but by their European counterparts.

In summary, a control system is needed that is practicable, proportionate, has realistic deadlines, enhances innovation and minimises the adverse effect on international competitiveness. The committee's report and this debate should help to achieve that.

10.15 p.m.

The Earl of Selborne

My Lords, the whole House is grateful to my noble friend Lord Crickhowell, but no-one more so than me. As he explained, I meant to chair Sub-Committee D but had to rule myself out because of a conflict of interests, as I am chairman of the UK Chemical Stakeholder Forum. It was to everyone's advantage that my noble friend was able to chair the committee and to report so succinctly this evening. He made later speakers' job much easier by covering rapidly the salient points of the report and highlighting that even the strongest Euro-sceptic would agree that in this field it makes sense to have a Europe-wide strategy. Chemicals float around in the air. It is a European business.

It is highly important that we do not create a competitive disadvantage by putting in place regulations in one country that would not apply to another. My noble friend Lady Hooper said that, while that is true of Europe, there remains a danger that Europe might put in place competitive barriers compared to other regions. My noble friend is right to draw attention to the issue. Ultimately, we should be looking at an OECD-wide policy, involving all the manufacturers of chemicals.

As my noble friends Lord Crickhowell and Lady Hooper, stressed, the chemical industry is large. It makes a highly important contribution to the gross national product, the Treasury, employment and our quality of life. Make no mistake, our quality of life would be greatly different were it not for the benefits we all derive from the chemical industry at every moment of our lives.

The debate has moved at times from the subject of industrial chemicals to herbicides, pesticides, sheep dips, and so on. It is important to remember that we are discussing industrial chemicals. There is already European legislation to deal with a range of other chemicals. It is nevertheless a strange fact that, while we have a relatively successful but by no means perfect policy for what are called new chemicals—that is to say, those introduced since the early 1980s—no proper risk evaluation has been made of 30,000 or more chemicals in production of more than one tonne in Europe. That is surprising, particularly when, by any criteria, whether one determines by high-volume production or high concern—bio-cumulative, toxic or persistent chemicals—many chemicals that have been around for 20, 39 or 40 years register as high concern. We still do not know the extent to which they impact adversely on humans or the environment.

As my noble friend Lord Crickhowell said, the Existing Substances Regulation was put in place in the early 1990s. Yet, 10 to 12 years later, we still have no worthwhile product. This Government, rightly, set the pace in Europe by saying that it was time that there were a Europe-wide strategy that made good the defects that the Existing Substances Regulation failed to address. I say happily from these Benches that the British Government have led the way, from the days of the European Council at Chester in 1998 to the publication of their own White Paper in 1999. One of the products of that White Paper was the UK Chemical Stakeholder Forum, which I am proud to chair.

This was a stopgap measure—like so much in Europe, I fear that it will last rather longer than we would wish—recognising that it will take too long to get Europe-wide legislation in place to register, evaluate and authorise the chemicals that are thought to be of concern. The Government wisely suggested to the chemical industry, the environmental interests, the animal welfare interests, trade unions and other interest groups that it would be helpful if there could be a voluntary forum that could get together to decide on the criteria to determine priority chemicals that should be evaluated faster under voluntary measures in the UK and to put in place voluntary measures that would redress some of the public concerns that were clearly not being dealt with at a satisfactory speed at European level.

Having taken on what I thought was a poisoned chalice, I am surprised to say that in practice all members of that forum—they are all voluntary members—have collaborated fully. The chemical industry has been extremely co-operative. The existing substances regulation was put in place in the early 1990s to identify those chemicals of high concern. The chemical industry, like everyone else, recognises that it is not acceptable that there is no obvious product from that legislation 10 years later. All sorts of reasons can given, but one clear reason is that the system plays into the hands of those who call for more data and think of an excuse to procrastinate. That is precisely what has happened.

There are three fundamental issues that a European White Paper should achieve. I can cut out most of what I was going to say, considering the late hour. There is a fundamental role for industry. Industry in this country accepts that and I hope the same is true in the rest of Europe. Industry holds a lot of data. In some cases it is probably stretching the bounds of credibility to say that the information should be concealed from the public because of commercial confidentiality. That is true of some of the information, not all of it.

There is an obligation on industry and on the downstream users to make as much information as possible open to the wider stakeholders—the public. It needs to be put in the public domain. The White Paper rightly emphasises that, under the REACH system, once a chemical is identified as a priority chemical, the onus is on industry to produce the information required for the dossier. The fundamental flaw under the existing substances regulation has been that the onus has been on the regulator. The White Paper addresses that important issue.

I was also surprised to find when the committee took evidence that, even though a substance may have been recognised under the existing substances regulation as being thought to be of concern, manufacturing industry says, with all honesty and quite accurately, that it does not always know who the downstream users are. As my noble friend Lady Hooper says, it may well get bonded in such a way that it becomes inert, but you do not know until you discover what uses it is put to. If you do not know what uses it is put to, how on earth do you do a whole-life analysis?

When the UK chemical stakeholder forum was identifying a particular chemical that was manufactured in this country, one of the first things we did was ask the manufacturer who the users were and how they were going to be monitored. It was accepted that the substance was of concern and had an impact on the environment, but how was the impact going to be limited? First, you form a club of the buyers of the chemical. Had they done it? No, yet for eight or nine years this chemical had been identified as being of concern under the existing substances regulation. We have urged them to form a downstream club of users. Then you can start working out the whole life cycle of these chemicals. That is a start.

The industry has not served itself well by not anticipating these sensible and fundamental requirements. By putting the onus on industry, the White Paper will do just that. That was the first of my fundamental requirements of any White Paper. The second, which has been touched on by others, was that it should be relevant and proportionate. My noble friend Lord Crickhowell has pointed out that the proposals are not proportionate. They are going to be bureaucratic, they are going to involve a lot of animal testing and it is going to be very difficult to test this number of chemicals, even if all the national facilities in the member states are brought into service. Therefore, one needs to prioritise fairly dramatically. If, as we suspect, many of the 30,000 chemicals about which we are talking are not of high concern, for goodness sake let us put them on the back burner.

The third fundamental principle is that we should be looking at something much wider than Europe. I accept the point made by my noble friend Lady Hooper—namely, that there is no earthly advantage in reducing the manufacture of chemicals in Europe if you simply import chemicals of the same nature from a lower safety regime elsewhere. You would simply be exporting the problem to countries that are less able to cope.

The committee was deeply impressed by the evidence from Mr Visser of the OECD. I believe that the long-term solution— I emphasise that this is long term—will appear when we can look at the major manufacturing countries involved with chemicals to agree, not just on the priority list of chemicals of concern but also on the proposals for evaluation and subsequent risk management on a global basis.

10.26 p.m.

Baroness Miller of Chilthorne Domer

My Lords, having listened to much of the preceding fascinating debate on the future of Europe, it became evident to me that one of the least-recognised success stories to come out of the European Union has been the fact that environmental legislation, which is much needed on air pollution, water pollution, habitat preservation, and chemicals may be initiated in one country and then spread in a way that is much needed in a single market that does not respect geographical boundaries. That applies especially to environmental issues. This debate is a good example of many of the issues about which people are talking theoretically.

However, I was disappointed to receive via the Internet this evening the news that Greece has apparently pushed back to the second half of the year the EU chemicals review deal, thereby reinforcing the fears of the chairman of the committee. I hope that the extra time can be used productively by governments to work out some of the more tangled issues involved.

In my notes I find that I have highlighted similar issues to those already mentioned by other noble Lords. There are three matters to which I should like to draw the attention of the House. At the beginning of the inquiry I was astonished by the fact that, prior to 1981, there had been no regime for notifying and evaluating chemicals. Indeed, not having been involved in the chemicals industry, I was singularly ignorant of that fact. There seems to be a mountain of work to be done to rectify the situation. The White Paper has brought the chemical industry into the light, if not the spotlight. Under the very able chairmanship of the noble Earl, Lord Selborne, I believe that the chemical forum will make good progress in this country.

I hope that the recommendations made in our report to the Commission will be helpful. I shall focus upon just a few of them in my remarks. I begin with the fact that the work is currently very slow, and, as I have just mentioned, has been further delayed. It is also not sufficiently focused. In their response to our report, I am glad that the UK Government say that they are pushing for clear time-scales. I very much hope for a further assurance from the Minister tonight that the next few months of delay will be used for ensuring that the issues are addressed so that when the matter comes before the Council of Ministers it will be in as complete a form as possible.

The most astonishing finding during the inquiry was the discovery that there is still a debate about whether the persistent bioaccumulative, toxic and very persistent chemicals should be included in the authorisation system for action on chemicals of high concern. Surely by their very name we can see that they are likely to pose an environmental risk. Along with endocrine disrupters, this collection of chemicals may not perhaps be as instantly emotive to humans as something labelled "carcinogenic"—that is, something from which we could get cancer—but we cannot ignore the damage to swathes of species from chemicals that build up to high levels and will persist for decades in the environment. I very much concur with the comments of the noble Earl, Lord Selborne, on the total life usage of chemicals. What happens to those chemicals when they enter the waste stream is one of the big issues that the review should tackle.

The report also highlights the contentious issue of animal testing. Earlier in the week, one newspaper report said that Sir Paul McCartney had criticised the World Wide Fund for Nature. I regret that criticism. I believe that the World Wide Fund for Nature is trying to find a solution to the very real issue of chemicals in our environment. The fact that whelks are changing sex and are unable to breathe due to environmental pollution caused by endocrine disrupters is every bit as cruel as product testing on rabbits in laboratories. Such pollution affects a less furry and cuddly species, but it affects a much larger environment.

There is every reason to end in vivo animal testing. The committee also heard compelling evidence that the provision of sufficient resources—an issue on which I understand that the UK Government are pressing hard; I hope for an update from the Minister—could result in more reasonable methods of in vitro testing. We need more research on the environmental effects of chemicals. Unfortunately. however, not all member states agree that more resources are needed in this sphere.

There is no point in the European Union attempting to reduce such risks if the regulatory regime is subsequently challenged by WTO members who are not covered by it and wish to import chemicals into the EU. What is the Minister's understanding of the position regarding the WTO? The noble Lord, Lord Crickhowell, has already raised the issue, but I should also like to highlight it.

I shall not repeat the comments of other noble Lords on the report. However, I am very pleased with its recommendations. I was also encouraged by the statement of Caroline Lucas MEP in relation to one issue examined by the sub-committee. Her statement shows that Members of the European Parliament read with interest the reports of your Lordships' House. I hope that they will act on the recommendations in this report.

It has been a great privilege to serve on Sub-Committee D for the past three years. I have learned a great deal and appreciated the opportunity to hear from experts on a wide range of subjects. I also very much enjoyed working with such knowledgeable Members of your Lordships' House. It is a great sadness that we must rotate off the committee, but I suppose that it is only fair that other noble Lords should be able to enjoy the experience. I hope that I will have the opportunity to serve on the committee again.

10.33 p.m.

Baroness Wilcox

My Lords, we have been asked to take note of the report of the European Union Committee, Reducing the Risk: Regulating Industrial Chemicals. We have had the opportunity to read the report and to hear the speech of the eminent noble Lord, Lord Crickhowell, the committee chairman for this set of investigations. We have also heard from the noble Earl, Lord Selborne; the noble Baroness, Lady Miller of Chilthorne Domer, who I am glad to see well and back in her place; the noble Lord. Lord Livsey, who is new to the committee; and the noble Countess, Lady Mar, whose reputation goes before her. I congratulate the committee on yet another terrific job of scrutinising proposed European Union legislation and on presenting considered and practical observations to urge the European Commission to temper its ambition with realism as it develops its proposals for a new European Union chemicals strategy.

The Select Committee recommends that the reform should be narrowed in scope to limit legislative delays, take better account of the complexity of downstream chemical usage, and take the opportunity to develop new methods of testing to reflect public demand for reducing animal testing.

As we have heard, the White Paper has stimulated debate over the future shape of a policy designed to regulate manufacture, marketing and use of industrial chemicals in order to protect human health and the environment. But, as so often with European Union legislation, the proposals are aspirational. They constitute the highest ideals but their ambitious programme is not properly costed, has unrealistic timetables and, as drafted, is impractical. I refer to a single system for new and existing chemicals. The new legislation needed will be complicated and contentious and, as the report of the European Union Committee under the chairmanship of the noble Lord, Lord Crickhowell, points out, the Commission will add to the difficulties of having the legislation adopted quickly if it tries to reform everything at once. We on these Benches agree with the report that the priority must be the reform of the regime for existing chemicals and that action is taken on chemicals of very high concern.

The proposal to transfer responsibility to industry, including downstream users to conduct preliminary risk assessments, is a centrepiece of the White Paper, as we have heard. But the regulation as presently proposed could cost Europe's chemical industry £5 billion—inevitably those huge costs will be passed to the end consumer—affect the jobs of 1.7 million people, and indirectly of many more, and require the testing of up to 30,000 compounds.

The noble Baroness, Lady Hooper, and the noble Earl, Lord Selborne, reminded us that Europe is presently the world's largest exporter of chemicals but faces growing competition from the United States, the Middle East and Asia. The chemical industry and the CHI emphasise that if the legislation goes ahead as currently outlined, it will be anything but effective and put European manufacturing at a competitive disadvantage. Our citizens could fall victim to unknown perils and risks from countries of manufacture whose standards and sources we cannot know or control.

We heartily support the purpose of chemicals policy to minimise or eliminate the adverse effects of chemicals while securing the benefits that they bring. We support the call of the noble Lord, Lord Crickhowell, for speeding up action at home and abroad. He says that consultation has gone on long enough. As he pointed out, we have waited—or is it wasted?—11 months waiting to debate this report. Let us call for positive action by the European Union and by the responsible authorities within the UK, and let us have a more realistic European Union chemicals strategy.

10.38 p.m.

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty)

My Lords, I am grateful for the debate and for the committee's work in producing a report which the Government take seriously. Most of its recommendations are very much in line with what the Government wish to see as regards Europe. I am grateful to the noble Lord, Lord Crickhowell, for initiating the debate and to other noble Lords who have spoken. I am delighted to see the noble Baroness, Lady Miller of Chilthorne Domer, back on form.

There is a certain degree of consensus in the House about what needs to be done. As the noble Earl, Lord Selborne, and the noble Lord, Lord Livsey, underlined, the basic problem is that we have a backlog of tens of thousands of chemicals currently in use, and, in many cases, in use for decades, on which we have insufficient data to prioritise and to address the hazards and potential risks to human health and the environment. Although the Government remain committed to getting the best of the current system for assessing and controlling existing substances between now and the coming into force of a new one, it is clear that the existing approach is inadequate to address this fundamental problem and that is why we need a major revision of the regime. It has to be a workable system, which recognises priorities. The discussions about prioritisation and scope are therefore important. Here, the Government have a slightly different approach from the committee. The system must operate as fast as possible to screen, prioritise and assess and, if appropriate, control the chemical substances. That means not overloading registration with large numbers of low priority substances, but it also means initially focusing on detailed work on the substances of most concern. That is to say, we must focus on those substances that are not already controlled by other regulatory regimes, that are available on the market, that meet the criteria for authorisation and that have raised in various ways the concerns of the public and the enforcement authorities.

That degree of prioritisation, however, does not mean that other substances should be outside the eventual purview of the system, but they should be addressed when those of most concern have been dealt with. That would enable benefits for the environmental and human health side to be gained as rapidly as possible while not blocking up the system. It would also mean that the system as established could be extended to other chemicals. In order to priori tine in that way, we need to operate to fixed deadlines and a clear sense of priorities.

I turn to the proposition, repeated by the noble Lord, Lord Crickhowell, which is effectively a request that we should have a two-tier system covering existing and new substances. It is true that the new substances directive works well, but improvements can be made. If we want the proposed REACH provisions to be comprehensive, new substances must be included from the start. Therefore separating them out and reducing the scope in the way that the committee suggests would not be appropriate. Having two regimes would undermine REACH, and the regulatory burden of running two regimes would impact on both regulators and the industry. Small and medium-sized firms especially would find it more difficult if we had a two-track system. In the long run, we see no advantage in running such a system. We see a high priority being put on establishing priorities for introduction of the new system.

On a more specific point, several noble Lords including the noble Lord, Lord Crickhowell, and the noble Baronesses, Lady Hooper and Lady Miller, referred to the issue of animal testing. The system must get the balance right between the need to have enough information to take decisions on substances and the degree of animal testing that that involves. Regrettable though it may be, it is clear that with the current state of scientific knowledge, it may not be possible to obtain all the necessary information without some animal testing. The Government strongly believe that much can be obtained from tests that do not involve vertebrate animals. We pushed that view in the negotiations in Europe, and will continue to do so. Between now and the coming into force of the regulations, further alternative test measures should be pursued and developed. The Government have called on the European Commission, and on the European Centre for the Validation of Alternative Methods in particular, to do what it can in that area. That is the Government's priority.

We support the minimisation of animal testing and the need to ensure that the test methods used reflect the so-called three Rs—reduction, refinement and replacement. It is important that the methods used are recognised internationally, however, which would avoid duplication of studies for regulatory authorities outside the European Union.

One key element of the system will be the authorisation process, and its scope. The Government agree with the committee's report that, in addition to CMRs and POPs, the environmental impacts are equally important. The noble Baroness, Lady Miller, made that point. Therefore, PBT and VPVB substances should be included in the scope of authorisation when criteria have been agreed. In other words, the environmental impacts are as important as the human health impact. We are urging that point through the discussions in the process as well.

A number of noble Lords—the noble Lords, Lord Crickhowell, Lord Livsey, and others—referred to the way in which the enforcement authorities will operate and have resources to cope with the increased workload. Clearly, demands will be placed on the regulatory authorities by REACH, and it will depend on REACH being fast, workable and efficient if we are to maximise the resources required at the administrative level. That burden will fall particularly on existing regulatory authorities. It is therefore important that industry should share part of the burden of the new regulatory regime. Under the present regime, regulatory authorities have to some extent borne a disproportionate part of the cost.

The Environment Agency will clearly be the major regulatory authority in England and Wales. The exact role of the agency—this responds to the noble Lord, Lord Livsey—will depend on the exact form of the legislation. Other parts of the Government—the Health and Safety Executive and other bodies—will be involved in the implementation of REACH. In the meantime, the Environment Agency is carrying out much of the background work. It has various roles in ensuring that we are in a position to adopt the regulatory regime once it is finally agreed. Meanwhile, the Environment Agency has been developing its own strategy, which was put out to consultation and which ended in September last year. I hope that by the end of this month, the agency board advisory group will consider a paper on how to take that further. The final stage of the implementation plan will go to the agency board in approximately May of this year.

That outlines the work already being undertaken by the main enforcement agency. In addition, much work has been done by industry and other interested organisations. I pay tribute in particular to the stakeholder forum to which the noble Earl, Lord Selborne, referred and of which he is chair. It has played an important role in developing thinking on the new EU strategy and has engaged many stakeholders. The fact that it has operated—stopgap or not—as an effective forum is a result of the chairmanship of the noble Earl. In particular, the contribution of that forum's member organisations and the work done in preparing the UK for the Commission's working groups, were particularly welcome. We look to the forum to continue to develop its views on the new EU chemical strategy as it develops. In addition, the Secretary of State for Environment, Food and Rural Affairs and the Secretary of State for Trade and Industry have, along with their officials, held a wide range of meetings with stakeholders in this area, and the process is continuing.

Several noble Lords, including the noble Baronesses, Lady Wilcox and Lady Hooper, and the noble Earl, Lord Selborne, underlined the importance of the chemical sector to our economy and the employment situation. It is one of our major industries and major success stories over many decades. It is therefore important that we do not do anything in the process that undermines the competitiveness of the chemicals industry and, to some extent, also the downstream industry. It is therefore important that we act in partnership with the industry when introducing the regime and with regard to the operation of the process of enforcement and information flow.

It is also important that we engage the downstream industry. The noble Earl, Lord Selborne, referred to the problems of knowing precisely to what uses some of the chemicals are put in the downstream industry. If the legislation is not carefully constructed, some of the impacts of downstream use could have severe consequences in environmental and safety terms and in economic terms if the legislation were geared in the wrong way or inadequately took account of the impact of those industries—a wide range of industries use chemical products.

Therefore, the two-way flow of information along the supply chain is particularly important, as is how it is managed. We need to provide the correct information for safe use and we also need to engage all parts of that chain in the operation. In this area, as in others, carrying out robust regulatory impact assessments is important. The Government's existing partial RIA, prepared on the basis of the Commission's White Paper, covers some of these industry-wide issues. We shall need to update that as the legislative proposals become more concrete. More work is needed in that area in relation to the impact on both the UK industry and the industry Europe-wide.

We were right to be reminded, particularly by the noble Lord, Lord Livsey, and the noble Countess, Lady Mar, of the basic problem that we are attempting to tackle and of the detrimental impact that the misuse of, and exposure to, some chemicals has on human beings and, indeed, on the environment. Organophosphates are a particularly drastic example of that and past agricultural use of organophosphates, in particular, is a major area of concern. That is why we are continuing to take the utmost precautions.

I note the noble Countess's remarks in relation to post-marketing surveillance. We support the need for such surveillance and we see an important role for industry in carrying it out. We are discussing, and will discuss further, with all stakeholders what form a post-marketing surveillance system should take.

This regime is directed principally at chemicals and the use of those chemicals manufactured within the European Union. However, as the noble Lord, Lord Crickhowell, said in his opening remarks, it is also important that we take account of the effect of imported substances and imported articles. With regard to articles manufactured in the UK or within the European Union, the substances used will already have been registered and their risk to the environment or to human health will be subjected to appropriate controls.

However, we do not have the same degree of control over substances in articles imported into the EU from outside. If those substances are completely uncontrolled, then naturally the normal economic drivers will encourage manufacturing industry to relocate. The risk to human health and to the environment may be exacerbated if we switch to imported goods. Therefore, I believe that the noble Earl's reference to the need to take a wider than European approach to this matter must ultimately be the appropriate course for us to take. Thus, issues that go wider than the EU are involved here.

The noble Earl also referred, as did the noble Baroness, Lady Miller, to the WTO implications, which form an important aspect of this issue. The Government are concerned to ensure that the EU legislation which is finally adopted is defensible in WTO terms. We do not wish to see the important goals of this policy in terms of protection of health and the environment put at risk because of the problems for international trade. Frankly, we know that the United States is already interested in this policy and is increasingly exercised about its potential consequences. Therefore, we need to keep an eye on how it is developed and presented and how it becomes acceptable to our trading partners in this respect. The successful implementation of the legislation is, in part, dependent on it being acceptable to our WTO partners.

One of the most critical remarks made during the course of the debate concerned the timetable. It is a vexed issue and, as all speakers have underlined, the need for action is urgent. Yet the legislation w ill be complex; it will be far- reaching; and it runs into all the international as well as EU-based difficulties. Poorly constructed legislation has been known in the European Union, and it would be disastrous were this legislation to be half-baked.

We recognise the need for urgency but also welcome the statement of the Environment Council in December that it would undertake a formal consultation this year. We would encourage the Commission to consult as widely as possible and to take into account these wider issues.

As to the precise timetable, we understand that the Commission may make proposals for legislation within the next few months. To take up the point raised by the noble Baroness, Lady Miller, we understand that the Greek presidency does not plan to put a priority on that in terms of examining the proposals during its presidency. Nevertheless, if the proposals are put forward, we would intend to use the time to consult widely within the UK. If they are not, we shall continue to work with the Commission during the next six months to ensure that those proposals are effectively developed.

Having said that, and reverting to the initial assessment of the timetable by the noble Lord, Lord Crickhowell, on such complex pieces of legislation it is difficult to say when the process is likely to finish. Frankly, I would be at least as cautious as the noble Lord, Lord Crickhowell, who said the end of 2005. Under the present process our assessment might be even slightly later than that; 2006 would be my guess at this point. We obviously want to ensure that we speed up that timetable as far as we can without running into the difficulties of having inadequate or misconstructed legislation in the process.

The Government understand that the Commission is working on a series of building blocks as a method of breaking down that task. That seems sensible. A final decision on whether there will be one piece of legislation or four pieces of legislation has not yet been taken. Nevertheless, the Government expect that the legislation will take the form of regulations rather than directives, which simplifies the matter slightly, but the timescale is still complex and major decisions on its format have yet to be taken.

Thankfully, the noble Lord, Lord Crickhowell, summarised for us the views of the Government's recent comment on this in December, our three objectives being efficiency and workability; minimising animal testing and maintaining or enhancing the competitiveness of the industry. Those are our three prime objectives. In addition, there is one other. The Government will want to see a system that is transparent and which is understandable to all parties, including not only the industry but also consumers, workers and other users of the substances with whom we are dealing.

That requires effective drafting and, in the course of such drafting, effective negotiation, discussion and consultation with not only the industry which produces these items but also the wide variety of industries and others who use them. That process is already under way both at European and UK level. If we can conduct that process as rapidly as possible we stand a chance of not only meeting the timetable I have just outlined but possibly slightly enhancing it. However, that is not a Government commitment. The processes of the European Union are well known to your Lordships who have taken part in this debate. It is most important to get on to the statute book of the European Union effective, enforceable and understandable legislation, which we can make work here within the UK.

Meanwhile, I thank the noble Lord, Lord Crickhowell, the Select Committee in both its former and current composition and, in particular, all noble Lords who took part in the debate.

Lord Crickhowell

My Lords, I thank all noble Lords who have taken part in this debate. At this late hour and in the light of what the Minister has said I shall make one point only. If we are to have delayed legislation—and I fear that we shall have some delays—it is even more important that the Government should take note of what we said about the importance of effective co-ordination and activity by Defra. by English Nature, by the Environment Agency and by British government organisations. They need to get on with the work that has to be done. We found quite big gaps in that respect. I hope that the Government will seize the opportunity, as we await the Commission's proposals, to get on with those urgent tasks.

On Question, Motion agreed to.

House adjourned at eleven o'clock.