Examination of Witnesses (Questions 40-59)
DEPARTMENT FOR
ENVIRONMENT, FOOD
AND RURAL
AFFAIRS
19 OCTOBER 2005
Q40 Mr Bacon: I think it was Mr Addison
who said earlier—and I wrote it down—"we try
very hard to get clarity". I think that was in relation to
the fridge issue, the Waste Management Directive. I suppose this
is a question for Mr Macrae, although it would be helpful to have
either of your views: is it that there is an inherent problem?
It is referred to in the Bellis Report on the problems of the
English system. The English legal mind is always looking for clarity
and the Continental legal mind has no interest whatsoever in clarity.
It wants it precisely to be as vague as it can be.
Mr Addison: Maybe I could comment
on one aspect of that and then ask my colleague Donald Macrae
to do so. From the Department's point of view, clarity matters
in terms of the achievement of the regulatory outcome that we
are aiming for. In other words, what we are trying to secure is
a particular sort of behaviour or to stop a particular sort of
behaviour and clarity matters to the extent that it supports that
objective. When we are in the process of transposing a Directive
we think about what we are trying to achieve and what the end
result of the regulation should be and make sure we provide the
clarity that is required to support that. At least that is the
principle that we need to be working to. I am not saying that
we get it right in every case but that is the direction we are
trying to head in. Clarity is not an end in itself. Clarity is
about achieving the objective we are trying to achieve. That is
why it matters.
Q41 Mr Bacon: I am saying is it not
the case that others, particularly with a codified legal system,
see clarity as a threat? Let me read you a quote from an article
concerning the transposition of Directives. It happens to be about
financial services but the point is the same. Mr Macrae, perhaps
you could comment. "There was a good deal of tension between
the departmental lawyers, who were looking at the words and the
civil servants, who wanted to achieve a practicable solution.
Luckily, as well as being badly drafted it had been badly translated
so we were able to exploit discrepancies between the different
language texts." Does that sound familiar to you? Is that
the sort of experience you would encounter in your work?
Mr Macrae: It does not sound familiar.
There is some truth in the general distinction you are drawing
there, speaking both as an English lawyer and Scots lawyer qualified
on both sides of the border, and therefore having an understanding
of Continental systems through Scots law. There is certainly much
greater stress in the English legal tradition on certainty, on
precedent, on being able to argue for a loophole in the law than
you find in Continental systems, which are based more on principle,
flexibility and where more things are left open, as you say, to
be decided by the courts. There is still a need for clarity whether
it is in the UK or any other Member State. In so far as there
is ambiguity in the Directive, it does not necessarily come from
a different legal system, it very often comes from the nature
of negotiating across a wide ranges of interests.
Q42 Mr Bacon: Mr Addison, since you
are the accounting officer if you are the "acting" Permanent
Secretary, then you are responsible for safeguarding the Department's
money. Since the Francovich case there has been an exposure
by the Department to actions for damages by individuals, if the
actions of we, the Member State, in failing to transpose a Directive
cause damage to individuals. Have you or has the Department suffered
as a result of that doctrine of direct effect through successful
actions?
Mr Addison: Not as far as I am
aware. Donald Macrae is shaking his head so that is a no.
Q43 Mr Bacon: Has the existence of
that legal doctrine acted as a significant incentive for you to
transpose on time or is it not something that you have not taken
much notice of?
Mr Addison: No, I think the gist
of this report and my knowledge of the way the Department works
confirm that we take transposition deadlines seriously and that
is what we are required to do by the over-arching policy as set
out, once again, in that Cabinet Office document. Timely transposition
is an objective so we take it seriously, and one of the reasons
I am sure we take it seriously is because of the Francovich possibility
but we take it seriously because it is a legal obligation.
Q44 Mr Bacon: Could you turn to Page
24. In Case Study Six it refers to delay by the Council in publishing
detailed criteria for what are called WAC limit values but it
points out that even after the council had, albeit belatedly,
published these values the Department did not put out a consultation
until December 2003, nine months afterwards. Why is that sort
delay permitted if you have got, I think you called, it a programme
management approach in place to make sure that things are done
on time?
Mr Addison: I might ask my colleague
Sue to comment on the specifics but just in terms of the point
about how can these things happen if we adopt a sensible project,
management approach to life, the introduction of programme
and project management is not that recent but it has been growing
in the Department over the last two or three years, I guess, so
the extent to which we could really say that programme and project
management is now making a significant difference to the way we
go about regulating, I would be happy to say that it certainly
has now. Looking back a couple of years, I think the position
would be more patchy. I do not think that is a fair test, if you
like, of the extent to which programme and project management
is going to be successful for us in tackling some of these issues.
We have taken that very seriously and we have every confidence
that it will improve the way we go about regulation and the timetables,
but it will not solve all the problems.
Q45 Mr Bacon: Do you have any idea
of the cost to the Department of infraction proceedings or infringement
proceedings that are brought against you?
Mr Addison: I cannot give you
a figure but we have had no fines as yet. The Report actually
makes that clear. The UK has not been fined as a result of infraction.
Q46 Mr Bacon: Unlike other Member
States?
Mr Addison: Some Member States
have but it is pretty rare.
Q47 Mr Bacon: They do not pay them
anyway, do they?
Mr Addison: I do not know the
answer to that, I am afraid. It is rare but it has happened. However,
it has not happened in the case of the UK and it certainly has
not happened in the case of Defra responsibility.
Q48 Mr Bacon: Is it possible that
we could get from the NAO a little note on those countries that
have actually had fines since the process of infringement proceedings
started, and a history of that fine, what happened to it and whether
it ever got paid in full?
Mr Burr: We will see what we can
do.[1]
Mr Bacon: Thank you very much.
Chairman: Thank you, Mr Bacon. Angela
Browning?
Q49 Angela Browning: Could I add
a codicil to that request from Mr Bacon. For example, immediately
to my mind came the case of Italian milk quotas where they were
fined, failed to pay it, and in the end got a most enormous discount
negotiated, which rather gave an incentive to everybody else to
do the same. It would be very interesting to see how commonplace
that is now.[2]
That particular case was a little while ago. Mr Addison, could
I bring you back to this question of copy-out and elaboration.
I would like to probe a few more points on this. Copy-out at the
end of the day leaves a much more loosely drafted piece of legislation
which ultimately the courts are left to determine. I just wonder
whether in what I would regard as a bit of a "pick-and-mix"
option which the Cabinet Office gives you here in being able to
go for one or both or a mixture, in terms of meeting deadlines
for compliance, whether copy-out is quite a nice option for you
which allows you to meet the 1.5% target? Does that occur?
Mr Addison: I am not aware of
any cases where we have decided on the grounds of timeliness alone,
if you like, to go for one option or the other. I may well be
corrected by my colleague and I will turn to him in a moment.
In terms of the general approach, it is true that the more you
simply import the Directive lock, stock and barrel, in one sense,
the simpler the process and the easier it is to comply with the
timescale. That is one of the reasons why we need to look at every
case on its merits. There may well be some significant disadvantages
to the regulatory purpose that we are seeking to achieve and the
industry's reception of the regulation if we do that, so the balance
needs to be struck in every case, which is why, as Donald Macrae
was saying, we need to look at each one very carefully and strike
that balance correctly, as I think the Report sensibly argues.
Striking a balance is at the heart of the implementation challenge.
Q50 Angela Browning: I think you
are already implying that testing legislation in court is not
for the faint hearted, is it? It is usually only able to be done
by large organisations or the corporate sector. It is not something
that small businesses, for example, are able to challenge in any
way?
Mr Addison: It can be an expensive
option.
Q51 Angela Browning: So you have
to seek this balance between meeting your targets of timeliness
and also getting a balance between not gold-plating but making
sure that you regulate in a way that is good regulation. I understand
from what you have said today that that is what you seek to do.
Can I ask you then when you come to elaboration, what in practice
is put on a minister's desk, when they are asked to sign off regulation
in order for the Minister to be quite happy, that there is no
gold-plating? What tangibly do you put in front of a Minister
to demonstrate that you have absolutely minimised gold-plating?
Mr Addison: Maybe Sue Ellis my
colleague can help with that because she has been through the
mill on a number of these cases. I think the Report's content
and the Department's record make clear that however we actually
couch this, it is a point that we do take seriously and ministers
would only be advised to go beyond a Directive (in the sense that
gold-plating means that you introduce more requirements than are
in the Directive) if that complies with the guidance that we have,
which is that the benefits have to exceed the costs. We would
take that requirement pretty seriously. Perhaps Sue can give us
some examples, if that is what you would like, about how this
works.
Ms Ellis: Ministers are usually
given a set of draft final regulations. They also have the completed
regulatory impact assessment. They would normally also have in
their pack a description of the issues that were raised during
consultation on the draft regulations and how that had changed
the final version of the regulations. We would normally draw to
their attention other issues that may have developed whilst the
consultation was taking place or subsequent to that, and invariably
we are asked by ministers what the practice is in other Member
States and exactly what they are doing. There would be normally
something in the covering submission on practice elsewhere. By
those methods we highlight to ministers where there may be elements
of gold-plating. As my colleagues have already explained, we are
under strong pressure not to gold-plate and not to put extra provisions
in. So it would be very rare for that to occur.
Q52 Angela Browning: So a minister
in signing off does not actually have a detailed analysis of where
you have gone beyond the Directive, for whatever reason? Occasionally
there may be a good reason to go beyond it (but I would hope not
too many) but the minister signs off without having that analysis
in front of him or her?
Ms Ellis: In my experience we
have not actually gold-plated the provisions of Directives so
we have not had occasion to have to highlight that to Ministers.
Q53 Angela Browning: Does that mean
ministers have not asked for it or do the ministers take it in
good faith that there is no gold-plating when they sign off?
Mr Addison: If I could just comment
on that. I think ministers would rightly expect in a submission
about the implementation of the Directive, if it were to involve
going beyond the terms of the Directive in terms of gold-plating,
to be advised that that was the case, and the Department I would
expect would do that.
Q54 Angela Browning: Right. Could
I bring you on to a point Ms Ellis has just raised and that is
what goes on in other Member States. We know from examples that
there are differences in the way different states think about
legislation, and although it is euphemistically called the "Single
Market", we all know in practice, particularly in the areas
covered by your Department, and particularly in the agricultural
sector where trade of agricultural products is a very important
part, that it is not a Single Market; we are as much in competition
with the French and Germans and Italians within the Single Market,
and so that is very important to us. If I just look on page 13
at graph number 5, you look as though you are doing extraordinarily
well. I look at Germany who apparently are making a bigger effort,
but when I look at countries like Greece and France there are
long blue lines there on that bar chart and yet the UK is doing
incredibly well. It seems almost astonishing to me that in Greece
or France they would actually be having a sort of session such
as this where they are asking ministers to get on and do these
things. What I am asking you is do you take into account in the
process of implementation of these Directives the disparities
between the way other EU countries are doing it from the point
of view of UK competitiveness within the EU.
Mr Addison: For some specific
examples I am going to turn to colleagues on my left and right
in a moment, if they have any. I think I should make clear that
the policy that we follow and the policy that we are required
to follow is set out in the guidance that we have talked about
and looked at specifically today. That has no provision for looking
aside at other Member States to see how far back they may be.
The guidance stands in its own right and the legal obligations
in terms of implementation stand in their own right and those
are the ones we pursue. The league table does move around a bit.
If you look at the most recent table that we sent out, France,
even allowing for the fact that there are new Member States, has
come well off the bottom. It is not in the top league but it has
come well off the bottom. So the numbers do move around a little
bit. The UK's position, as I have said, has been stable. We are
one of the best but not the best in terms of meeting the timeliness
target. Even so, as has been pointed out already, the truth is
that we do not implement on time a considerable number of the
Directives that fall to be transposed.
Q55 Angela Browning: Is that because
things like consulting on regulatory impact assessments and that
type of process (which is part of the way we legislate here) sometimes
delay implementation? Is that the causal effect of the late notice
that is given to people when you are about to implement a Directive,
as we have seen from the examples in this Report, so there is
really very little lead time for the organisational industries
involved to appropriately be able to respond in the timeframe
you set?
Mr Addison: If I may say so, I
think that is a bit of a generalisation in the sense that in many
cases we manage to give the industries and businesses a sensible
amount of time to take the necessary steps. We do that by informal
consultation as much as by the issue of formal guidance. There
are a number of reasons why it is hard quite often to hit the
deadline for transposition. One rather obvious reason is that
in some cases the Directive gives the Member State a very short
time to implement, and one of those is mentioned here; I think
it was Emissions Trading Directive. The second, and this is more
particularly a UK matter, is that we can only say properly that
the UK has transposed fully if each individual part of the UK
has transposed fully. That includes England, Scotland, Wales,
Northern Ireland and in some cases Gibraltar. The way that process
works, and the pressures in particular on some of those legislatures,
inevitably delays things. Those are all reasons why it can be
quite challenging to hit timeliness deadlines. We think with the
stronger programme and project management approach we have, and
clocking these issues at the outset rather than stumbling across
them further down the track, is a way of improving our record
in terms of time limits.
Q56 Angela Browning: My time is up
but if I could ask one quick question to save me coming back at
the end. If you do not know the answer I would be pleased perhaps
if you would write to us. In the final stages of negotiating these
regulations, and most of the are subject to qualified majority
voting, one of the things that can sometimes happen, and in fact
I think happens quite a lot, is that in order to get some form
of agreement there are derogations issued, and certainly
in terms of the timescale of implementation, it is very often
an option that Member States can take up. Can you tell us how
often the UK Government takes advantage of that derogated time
on implementation in comparison with other Member States as far
as your Department is concerned?
Mr Addison: Perhaps I could ask
my colleague Donald Macrae to answer.
Mr Macrae: We would normally take
advantage of derogations.
Q57 Angela Browning: In every case?
Mr Macrae: Normally. I cannot
say in every case. There may be some exceptions but if we negotiated
the derogation we would want to use it.
Q58 Angela Browning: I am not just
saying if we negotiated if but if there was one available at the
time that the Directive is finalised which Member States can opt
into if they wish, that is what I am looking for, to find out
how often we have adopted that derogation just to give us that
bit more lead time?
Mr Addison: There is an example
in the Report where we had an option of bringing in the waste
acceptance criteria on one date, either July 2004 or July 2005,
and we went for the later one. The answer to your general question
about the frequency with which we do it I am afraid I cannot say
but, as I say, there is one example where we did that in the Report.
Chairman: Thank you, Mrs Browning. Ian
Davidson?
Q59 Mr Davidson: Can I ask about
the relationship between yourselves and the devolved administrations.
As I understand it, the UK Government is liable for any penalties
that apply, yet the devolved administrations are responsible for
actually implementing things. I am not quite clear exactly how
that relationship works. You could quite easily have a situation
where people are reinventing the wheel. To what extent has that
been avoided?
Mr Addison: First of all, on the
first specific point about fines, my understanding is a little
different to yours, and no doubt Donald Macrae will be able to
correct me if I get this wrong. In the event there were successful
infraction proceedings mounted by the Commission and the UK was
fined, it would fall to that particular administration which had
not implemented or transposed it effectively and properly.
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