This is a House of Commons Committee report.
Select Committee on Statutory Instruments
Date Published: 10 June 2022
At the Committee’s meeting on 8 June 2022, it scrutinised a number of instruments. It was agreed that the special attention of the House of Commons should be drawn to one of those considered in accordance with Standing Orders. The instrument and the grounds for reporting it are given below. The relevant departmental memorandum is published as an appendix to this report.
1.1 The Committee draws the special attention of this House to this Order on the grounds that it fails to comply with proper legislative practice in one respect and is defectively drafted in another respect.
1.2 This Order, which is subject to the negative resolution procedure, widens the scope of VAT relief for energy-saving materials and introduces a temporary zero-rate of VAT for the installation of energy-saving materials. The Committee asked Her Majesty’s Revenue and Customs to explain why articles 1 to 7 come into force less than 21 days after being laid before the House of Commons. In a memorandum printed as an Appendix, the Department explains that the policy is very important to the government’s aim to increase energy efficiency and that the Department wished to accelerate take-up and prevent loss of investment. It further states that a delay between announcement and implementation would potentially have an adverse effect on the energy-saving materials market and could create a stalling effect in the market, which in turn could result in supply bottlenecks further down the line. A mere assertion of a desire to avoid delay in the implementation of policy will not generally be regarded by the Committee as justification for failing to comply with the rule. As for the assertion that businesses and consumers may delay entering into contracts and this may lead to a bottleneck of supplies, the Committee is unclear how this is different from many other statutory instruments where changes are made that can have an effect on contracts and supplies but where the 21-day rule is adhered to. The Committee accordingly reports this instrument for failure to comply with proper legislative practice.
1.3 Article 8(2)(a), (b) and (c), which come into force on 1 April 2027, provide that the provisions inserted by the specified regulations should be omitted. The Committee asked the Department to explain why the article refers to “regulation”. In its memorandum, the Department explains that the article should instead refer to “article”, as the provisions to be omitted are those contained within this Order. The Committee accordingly reports article 8(2)(a), (b) and (c) for defective drafting, acknowledged by the Department.
The Committee has considered the instruments set out in the Annex to this Report, none of which was required to be reported.
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S.I. Numbers |
S.I. Title |
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S.I. 2022/414 |
Trade Remedies (Miscellaneous Amendments) Regulations 2022 |
|
S.I. 2022/525 |
Customs Tariff (Preferential Trade Arrangements and Tariff Quotas) (Ukraine) (Amendment) Regulations 2022 |
|
S.I. 2022/528 |
Customs (Variation of Import Duty) (Amendment) Regulations 2022 |
|
S.I. 2022/529 |
Income Tax (Exemption of Social Security Benefits) Regulations 2022 |
|
S.I. 2022/588 |
Customs (Export Declarations) (Amendment) Regulations 2022 |
1. The Committee has asked Her Majesty’s Revenue and Customs for a memorandum on the following points:
1. Explain why articles 1 to 7 of this instrument come into force less than 21 days after being laid before the House of Commons (having noted the reasons provided in paragraphs 3.1 and 3.2 of the Explanatory Memorandum).
2. Explain why article 8(2)(a), (b) and (c) refer to “regulation”.
2. This memorandum has been prepared by Her Majesty’s Revenue and Customs on behalf of HM Treasury.
3. In relation to point (1), the Department apologises for non-compliance with the 21-day rule. This policy is very important to the government’s aim to increase energy efficiency in the United Kingdom and, in order to accelerate take-up and prevent loss of investment, articles 1 to 7 of the instrument came into force eight days after being laid and announced.
4. As set out in paragraphs 3.1 and 3.2 of the Explanatory Memorandum, the changes were introduced urgently because a delay between announcement and implementation would potentially have had an adverse effect on the energy-saving materials market. A delay could have caused a temporary stalling effect in the market which could have resulted in supply bottlenecks further down the line. This could have undermined the policy objective of the instrument.
5. In relation to point (2), article 8(2)(a), (b) and (c) should refer to “article” instead of “regulation”. We apologise for this error and regret it was not corrected before the instrument was made.
Her Majesty’s Revenue and Customs
24 May 2022
Jessica Morden, in the Chair
Dr James Davies
Paul Holmes
John Lamont
Richard Thomson
Draft Report (Second Report), proposed by the Chair, brought up and read.
Ordered, That the draft Report be read a second time, paragraph by paragraph.
Paragraphs 1.1 to 1.3 read and agreed to.
Annex agreed to.
A Paper was appended to the Report as an Appendix.
Resolved, That the Report be the Second Report of the Committee to the House.
Ordered, That the Chair make the Report to the House.
Adjourned to a day and time to be fixed by the Chair.