Ministers have been urged by industry leaders to radically rethink a post-Brexit chemicals regime, amid warnings it could cost £1bn to implement, drive business away and lead to “additional and repetitive animal testing”.
In a strongly worded letter, seen by the Financial Times, 25 business heads said they remained “extremely concerned” about current plans for a new system of chemicals regulation, and warned it would “hit UK industry hard across a range of manufacturing sectors”.
Boris Johnson’s government is now facing protests from various sectors as the impact of the Brexit trade deal becomes clearer, ranging from musicians to shellfish exporters and traders in Northern Ireland.
But the criticism of plans to set up a British version of “Reach” — the EU system for registering chemicals — pits ministers against a broad swath of manufacturing, from chemical companies to their customers in sectors such as cars, aerospace, food and drink, steel and perfume.
The letter, addressed to ministers including chancellor Rishi Sunak, business secretary Kwasi Kwarteng and environment secretary George Eustice, estimates the cost for complying with the new rules “at around £1bn” and calls on the government to adopt “a more proportionate, effective and efficient” UK Reach model to avoid causing serious harm.
“Perversely, this cost to industry for compliance for one jurisdiction will be double the £500m UK companies have already spent over the past decade in complying with EU Reach and its, now, 27 markets,” the letter adds.
It warns that UK Reach, as currently legislated for, could “lead to potential additional and repetitive animal testing” and that it could become uneconomic to register some lower quantity substances in the UK.
“All in all, this will hit UK industry hard across a range of manufacturing sectors, reduce the competitiveness of UK manufacturing and lead to a loss of inward investment, as companies look outside the UK for their manufacturing hubs for Europe,” the letter says.
“Its impact on jobs will be felt particularly in the north and midlands, where most of the chemicals industry and reliant manufacturing sector is based.”
The warnings that the UK Reach system will damage Johnson’s “levelling up” agenda and could lead to more animal testing shows the politically sensitivity of the issue.
Under the terms of the Brexit trade agreement, Britain lost access to the EU’s chemicals database where existing substances are registered, forcing ministers to duplicate the effort domestically.
Ministers will meet industry leaders on February 15 and have vowed to do what they can to minimise the burden on industry. Responsibility for the issue falls across several departments.
A government spokesperson said: “We fully recognise the importance of our chemicals sector. In developing UK Reach, we have aimed to keep any changes as simple and straightforward as possible. We have also put in place a range of measures to minimise the burdens and costs for businesses in this process.
“We have received a letter from a number of chemical trade associations and are considering it.”
Industry wants the UK Reach system to focus on “substances of concern and future UK priorities” and wants ministers to look for ways to strengthen co-operation with EU regulators.
They want to remove the need for the UK regulator and industry “to spend seven years of staff time and resources re-registering substances in the EU Reach database with full data packages, the vast majority of which will never be looked at”.
Separately the British Coatings Federation, which represents companies using inks and paints, published a survey showing that 50 per cent of its members believed the EU/UK trade deal would reduce the competitiveness of their UK factories compared with EU competitors.
Almost 60 per cent were worried about the future effects of UK Reach on raw material prices and potential lack of availability of chemical substances.
The Chemical Industries Association, one of the architects of the proposal, declined to comment in advance of the meeting with ministers next Monday.