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That is very welcome, but it is important to note that the Secretary of State is calling for EU action rather than domestic UK action.
In an answer to a parliamentary question from my hon. Friend the Member for East Surrey (Mr. Ainsworth), the current Minister indicated that creating a new offence would not be possible under UK law. He stated:
“The UK Government cannot institute legal proceedings in the UK relating to a breach or breaches of sovereign laws in another country”.—[ Official Report, 24 November 2008; Vol. 483, c. 858W.]
However, my hon. Friend the Member for South-East Cambridgeshire (Mr. Paice), the shadow Minister for agriculture and rural affairs, has sought legal advice, which states:
“There is certainly no reason I can see why it should not be possible to create an offence of selling or distributing imported wood illegally harvested in its country of origin (or, indeed, of importing such wood into the UK).”
Crucially, and contrary to the Minister’s previous statement, it may therefore be possible to create a new offence under UK law. We should examine that possibility.
Huw Irranca-Davies: If we wished to do so, we could certainly produce legislation imposing legal requirements on UK businesses in relation to the way in which they deal with processing and importing timber. However, I return to my earlier comment about what would be workable and proportionate. Should we expect UK producers, suppliers and processors to accept a burden that is not commensurate with the burden placed on those in other European Union countries?
Mr. Wilson: I am pleased to hear the Minister say that the UK could produce that legislation, because I had not heard of such an agreement before, but I repeat that the Secretary of State said:
“We need to bring an end to this pernicious trade. Illegal timber should be just that—illegal.”
We have the opportunity to do that, under UK law. I understand what the Minister says about burdens on business, but action to deal with illegal logging is very important to the future of not just this country but the whole world.
Barry Gardiner: The burden on UK businesses will not be increased at all. The primary burden that they already bear is compliance with the law in the timber-harvesting country. If they comply with that law—as they will say that they do—there will be no additional burden vis-Ã -vis other European suppliers.
Mr. Wilson: That is an interesting point. I bow to the hon. Gentleman’s enormous knowledge of these matters. Personally, I am not sure that there would be a massive increase in the regulations with which companies in this country would have to comply.
Tackling illegal logging would go a long way towards saving lost revenue and preventing the widespread environmental damage, loss of biodiversity and increases in carbon emissions to which illegal logging contributes. In 2007 we published a paper called “Forests for Life”, which outlined a number of potential directions worthy of consideration. It followed wide consultation on a range of measures aimed at reducing deforestation and the trade in illegal timber, including making the possession of illegal timber an offence.
2.8 pm
Barry Gardiner (Brent, North) (Lab): I congratulate my hon. Friend the Member for Hendon (Mr. Dismore) on introducing the Bill. I shall speak only briefly, because I want to hear what the Minister has to say.
Before I tackle a few central issues, let me set out the context. My hon. Friend the Member for Hendon rightly referred to the FLEGT agreements. FLEGT is the process of bilateral licensing between the European Union and partner countries under which timber licensed from those countries can be imported into the EU and accepted as legal.
It would be wonderful to have a global FLEGT system, which would largely put an end to illegal logging in international trade, although not necessarily internal trade within countries. However, we do not have such a universal system, and until we do, leakage will always be possible. Leakage simply means that timber that does not come into the EU can be sold to other countries—I will not name them, although many people will know the key candidates—which produce artefacts and goods, such as tables and chairs, that then come into the European Union apparently legally and from a legal source. It is precisely because the current licensing, even if expanded, would still allow that leakage—that circumvention—that it is important that the EU and, I would add, the UK should act to block it.
A number of years ago, the European Commission came up with a series of proposals, which it consulted on, for additional options to the FLEGT arrangements. For years Ministers had said, “We’ve got to wait and see what happens in Europe.” We also had non-governmental organisations saying, “Won’t it be better if we can get a Europe-wide scheme? If 27 countries can act together, we can really get to grips with the problem and stop illegal logs from coming into the European Community.” That was a counsel of perfection that nobody disputed; however, I never believed that that would happen. Indeed, in May last year the European Commission abandoned its additional options proposals. On 17 October last year, it then came up with a system of due diligence, which my hon. Friend the Member for Hendon and others have outlined.
It is by looking to that system that the Government can say that no UK legislation is required, so let me be clear why it is inadequate. Under the EU proposal, an importer who has never imported illegal timber and does not attempt to do so can be prosecuted for failing to follow the due diligence system. However, an importer who deliberately imports illegal timber cannot be prosecuted as long as they can show that they have followed the due diligence system. The EU’s proposals are procedural. They are not substantive and they do not go to the heart of the issue, which is this: is illegal timber coming into the EU and into this country? The answer is yes. That is what we need to stop.
The EU proposals are for a tick-box process, which means that as long as someone can show that they have asked a supplier whether something was legally sourced and they say yes, that person gets off scot-free. It does not matter whether they believed the supplier or even whether they knew that he was lying through his teeth; as long as that person can tick the box, the EU’s process would allow them to import illegal timber and yet evade
prosecution. That is why the EU process is fundamentally flawed. It is a process; it is not a way of tackling the substantive problem.
The reason why the amended Lacey Act, as introduced by the Americans, is a good method and why it precisely counters the Minister’s earlier remarks about ensuring that the system is workable and does not impose undue burdens is that it is a very elegant piece of legislation. It shifts the balance of risk, by providing a clear incentive for companies to drive the burden of due diligence back down their supply chains. The Lacey Act ensures that the trappings of legality, such as the certificates of legality that can be bought for $5 in Douala market, do not hold weight. It is better that the importers and distributors should be put on notice that they can be opened up to challenge at any point and that they will face substantial penalties if they are found guilty.
Importers can continue to import timber into this country through their supply chain as long as they have confidence in their procedures. They will not be stopped at the border. There will be no requirement to show certificates or anything of that nature. If they are challenged, however, and if the timber is shown to be illegal, they will have committed an offence. The burden will have been shifted on to them to ensure that their supply chain is right. They will not be able simply to say, “I did this, I did that and I did the next thing, therefore I’m all right.” They will actually have to get it right. Many of them say that they are already doing so.
The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Ogmore (Huw Irranca-Davies) will know that I am thoroughly in favour of the new regulations on Government procurement that came in earlier this year. Indeed, I was the Minister in the Department who proposed them at the time. Government procurement accounts for 40 per cent. of procurement in this country, as my hon. Friend the Member for Hendon said, so most of the suppliers will now have to comply with those much more onerous regulations.
It is important that the UK should give a lead on this matter, because Europe has shown that it is incapable of doing so. There are no penalties in the proposals from the European Commission. The penalties regime is left to each of the 27 member states. My hon. Friend the Minister knows well that perhaps 21 or 22 of those countries will do nothing whatever on this issue. It is only by our giving a strong lead through independent regulation in the UK that we will bring the European Commission to the point of introducing strong European legislation that can achieve the goal of universally tackling the problem.
2.17 pm
Simon Hughes (North Southwark and Bermondsey) (LD): I shall be brief. I pay tribute to the hon. Member for Hendon (Mr. Dismore). He is scoring well this afternoon, and we want him to score well on this Bill. I also pay tribute to the hon. Member for Brent, North (Barry Gardiner) for the work that he has done, and for his continuing interest. I join the hon. Member for Reading, East (Mr. Wilson) in saying to the Government that I hope they will be very positive about this Bill.
We support the Bill, and I shall briefly summarise our reasons for doing so. First, as the hon. Member for Brent, North has just said, the UK has to lead if we are
to deal with global warming and deforestation and take our international responsibilities seriously. The Prime Minister has made an announcement today about the responsibility of the UK in taking the lead, so that the developing world is not asked to take an unreasonable share of the contribution in dealing with climate change. This is an example of how we can lead.
Secondly, we have a particular responsibility because of the failure of the Europe-wide process. Thirdly, this is a live, practical issue on the doorstep and among the traders, be they in Ogmore, in south London or in Berwick-upon-Tweed. This is about ensuring that everyone understands their international and global responsibility. People who are in the import and export business, the timber trade and the construction industry will need to be on notice that they have a responsibility to ensure that the products that they deal with are properly and legally acquired, and that they do not contribute to problems in other parts of the world, further up the supply chain. This is about giving them that responsibility. Sometimes we need to have sticks as well as carrots, and sometimes we have to say, “This is a criminal offence, guys, if you don’t get it right.” I hope that the Minister will be positive about the Bill, and that we have allowed enough time for him to say yes, to allow the Bill to go into Committee.
2.19 pm
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Huw Irranca-Davies): I am pleased to respond to this very good debate. It has been noted that it is also a very live debate, as we are in the midst of European negotiations on this subject. We are engaging in live time, not only with my hon. Friend the Member for Hendon (Mr. Dismore), who has introduced the Bill, but with a wide range of stakeholders, including various non-governmental organisations, the Timber Trade Federation, and small and large businesses, all of which are trying to push in the right direction. The question is how we achieve what we are all signed up to and stop illegally sourced timber from entering not just the UK but anywhere in the EU. How can we do that in a way that delivers what we all want to achieve? That is the nub of our debate. I welcome this genuine debate on the issue, on whether the Bill provides the right way forward and on whether there are alternative ways of achieving what we want. The Bill is set against the background of real-time discussions and negotiations in Europe.
Barry Gardiner: Will the Minister address this point? Why is it sensible for the European Union to construct a new and different regime for tackling the problem when, for once, the US has been in the lead on an environmental issue and has put in place an effective regulatory regime that is already dealing with the problem? The EU could simply go with that regime.
Huw Irranca-Davies:
My hon. Friend raises an important question, which I will come to. The Lacey Act is often referred to as a gold standard, in putting forward a complete ban or prohibition. It sends a very strong signal and works all the way down the supply chain. I cannot remember the exact date but the Act was introduced in the early 1900s, originally to deal with fishing and related issues. It has subsequently been used to bring
forward legal sanctions. It was amended in 2008, but it has not yet been used to bring prosecutions for timber violations. We are hopeful that such prosecutions will go ahead, but to the best of my knowledge there are none as yet; there may be some pending. We are hopeful and watch with interest.
Barry Gardiner: I recollect from the American man who was representing the American customs agency at Chatham House last year that a prosecution has already been pursued against an illegal importer of timber. I am going on what he said at that Chatham House meeting.
Huw Irranca-Davies: Perhaps we can clarify that further after this debate. As I said, we are hopeful that there will be some prosecutions, but to the best of our knowledge, they have not yet been brought. The Lacey Act has been used to bring successful prosecutions in other areas, but not in respect of timber. We watch with interest because if, as my hon. Friend says, the Act can be shown to work and deliver, we should not discount it out of hand. Let me go on to deal with other points.
I acknowledge the work of my hon. Friend the Member for Hendon as Chair of the Joint Committee on Human Rights, and that of my predecessor in my current role, my hon. Friend the Member for Brent, North (Barry Gardiner). He brought forward an earlier Bill, with the WWF and others, which was also well supported. In his former role as special representative on forestry, appointed by the Prime Minister, and in his current role as co-chair of GLOBE International, my hon. Friend has never resiled from his commitment to this issue at any level.
As others have said, this issue goes to the heart of where we are on climate change, criminality, corruption, the rule of law, good governance in countries, economic development, impacts on indigenous communities and forest ecosystems, and so forth. If we get this right, the impact will be significant. It is how we get it right that lies at the core of the debate. We genuinely support the motivation behind the attempt of my hon. Friend the Member for Hendon to deliver legislation to tackle what has become a quite pernicious trade in illegal timber. It is a global problem not just a UK problem or an EU problem, and it has far-reaching environmental and development impacts.
We in the UK, as my hon. Friends will recognise, have long called for legislation at EU level on a multilateral basis—with all the frustrations that that involves. Various Committees of this House have said that they recognise the frustrations of a multilateral approach, but they have said at the same time that that has to be the way to deliver on this issue, because taking action on a unilateral basis will not deliver the sort of effects that my hon. Friends are looking for.
Mr. Dismore: Would my hon. Friend like to give an estimate of the number of square miles of illegally logged timber that have been cut down since the EU discussions started?
Huw Irranca-Davies: I cannot give that estimate off the top of my head, but I acknowledge that, as we speak here today, acres and acres of illegally logged timber is being cut down around the world.
Barry Gardiner: I rise simply to make the point that these things must not be placed against one another; it is not about this Bill or a European Bill. We have proposed this Bill precisely because we believe that it is necessary for one country or another to put spine and backbone into the European Commission in order to get decent legislation Europe-wide.
Huw Irranca-Davies: Yes, I appreciate what my hon. Friend says.
Let me turn to the nub of the Bill and deal with a few issues that address the points that have been raised. We are currently right in the middle of European negotiations on a due diligence regulation, which was released by the Commission in October 2008. The regulation aims to tackle this very problem with the timber trade; there are discussions over which is the best way to do it, but that is what we are trying to do. The UK Government are working with EU and other stakeholders, some of whom want to push harder and go faster. Our position has been that action to address the problem with the timber trade must be taken at the EU level, otherwise we risk simply diverting the trade elsewhere within the EU. Strengthening our measures would send a strong unilateral signal, but if we do not tackle this problem at the EU level as well, leakage will take place elsewhere.
Mr. Dismore: As I said in my opening remarks, we are the fourth largest timber importer in the world. If we take the decision to make this illegal and a criminal offence, about 40 per cent. of the timber will not be coming in illegally.
Huw Irranca-Davies: Let me go straight to the heart of why we think the EU approach is right, and why to do this on a UK basis would not only be difficult, but might be the wrong approach to take.
The hon. Member for Reading, East (Mr. Wilson) raised the issue of my previous statements and whether we can bring forward UK legislation. I have just tried to clarify that we cannot set up a separate UK legislative process that is different from our EU commitments, because if we were to do so, we might well open ourselves up to infraction procedures. We must be aware of that.
Let me now turn to the issue of administrative costs. It has been said that they might not exist or they might be minimal, but administrative costs would be incurred in proving that timber has come from good sources. That would not only involve the B&Qs of this world; every single supplier down the line would need to prove that they had taken their responsibilities seriously and had proved the source of the timber.
I agree with my hon. Friend the Member for Hendon that the UK should provide leadership. My right hon. Friend the Secretary of State is advocating the idea of putting a prohibition on the import of illegal timber—not a prohibition right down the chain, but a prohibition at the point of source, so that the company or individual who imports illegally into the UK will be subject to the prohibition and it is against them that action will be taken. That would be a strong signal. It is stronger than many of our European members want us to give, but we are pushing very hard indeed for it.
I am committed to agreeing strong regulation for ourselves and the European Union. Some of the proposals in the regulation have led us to reflect carefully on possible impacts on the timber industry, not least on small forest owners in the UK. I understand that the Commission discounted a prohibition in its earlier deliberations after difficult internal discussions on the right way forward, but we have been talking to Commission lawyers about how we might best reflect our—
2.30 pm
The debate stood adjourned (Standing Order No. 11(2)).
Ordered, That the debate be resumed on Friday 3 July.
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