Time running out to bring in consumer protection laws before Brexit, NAO warns

Some consumer and business protection laws risk not being in place by the time Britain leaves the EU, the head of the National Audit Office has warned.

Sir Amyas Morse said that preparing for Brexit was not easy with so many “what ifs” remaining over the UK’s future relationship with Brussels, and subsequent pressure on the parliamentary timetable.

An NAO report released today analysed the Brexit planning on consumer protection, competition and state aid by the Department of Business, Energy & Industrial Strategy (BEIS), National Trading Standards and the Competition and Markets Authority (CMA).

It said they face significant challenges to implement secondary legislation by the time the UK leaves the European Union in March.

Sir Amyas, the comptroller and auditor general, said: “It is not an easy task pushing forward with preparations for EU exit surrounded by what ifs

“BEIS, National Trading Standards and the CMA have at least recognised which areas need to be ready by day one, but they will need cross-government support in implementing these priorities and cross-border co-operation to ensure UK consumers and businesses can continue to trade smoothly.

“There will be many areas that departments and authorities across Whitehall simply cannot be prepared for, so the government needs to seriously help departments scramble and prioritise their efforts around what matters most to us come 30 March 2019.”

The NAO report said that there were Brexit risks to cross-border issues, including market surveillance and data sharing, cross-border enforcement and “consumer redress for cross-border transactions”.

Regarding competition law, it noted: “BEIS has drafted and consulted on secondary legislation but pressures in the legislative timetable could have an impact on readiness for 30 March 2019.

“The main statutes covering competition in the UK are already modelled on EU law, but BEIS has identified a number of areas that are essential to the functioning of the UK regime, and which will require amendment in all scenarios

The CMA has estimated that it will need an extra 240 staff to “upscale” its existing competition and consumer protection responsibilities, an increase of 39%, it also found.

While it believes it can deliver its required changes if issues were addressed “promptly”, the NAO report added: “The CMA is in a competitive environment for staff, and may need to re-prioritise certain aspects of its work if it cannot recruit the numbers or skills and expertise it needs in time for the increase in caseload.”

Meg Hillier, chairwoman of the Committee of Public Accounts, said: “Delays to the government’s Brexit legislation mean consumers and businesses may lose important protections if the government doesn’t ensure Parliament has time to get the right laws and regulations in place on areas such as product safety and state aid.

“The Competition and Market Authority’s new responsibilities will cost around £24m a year but the impact on already stretched local trading standards is not yet clear.

“Another example of the wider cost of Brexit to the taxpayer over and above the financial settlement amount – government needs to be upfront about these additional costs.”