Recognition of Professional Qualifications and Implementation of International Recognition Agreements (Amendment) Regulations 2023

Motion to Approve

Moved by

That the draft Regulations laid before the House on 17 October be approved.

My Lords, these regulations were laid before the House on 17 October 2023. They implement the world-leading recognition of professional qualifications provisions within the UK’s free trade agreement with Norway, Iceland and Liechtenstein—the EEA/EFTA states. This was one of the first free trade agreements to be agreed by the UK following our departure from the EU and continues our strong trading relationship with these valued partners. They provide certainty for professionals with qualifications from these countries who want to be recognised by UK regulators and work in the UK.

Given that the provisions in the agreement are reciprocal, UK professionals also benefit from reduced barriers when having their qualifications recognised in Norway, Iceland and Liechtenstein. I will begin with some background to explain what the provisions achieve. I will then move on to discuss the regulations in detail.

The UK signed a world-leading free trade agreement with Norway, Iceland and Liechtenstein in July 2021. Chapter 12 of the agreement outlines an ambitious system for the recognition of professional qualifications between the parties. Under the agreement, UK regulators are required to recognise comparable professional qualifications obtained in Norway, Iceland and Liechtenstein. Regulators in those countries are required to recognise comparable professional qualifications obtained in the UK.

Reciprocal provisions on recognition of professional qualifications are an important part of the UK’s services trade agenda, helping UK professionals enter new markets and deliver our world-leading services overseas. They also help at home, supporting overseas professionals to enter the UK labour market. Enabling this free flow of skills internationally leads to enhanced UK prosperity. Recognition of professional qualifications is a common feature in the UK’s modern trade deals, but the provisions we agreed with Norway, Iceland and Liechtenstein are relatively distinct by introducing binding obligations on regulators.

This agreement underpins our valued co-operation with long-standing trading partners on the recognition of professional qualifications. The Government understand the importance of continuity for British businesses. As such, this agreement seeks to maintain similar recognition of professional qualifications outcomes to the UK’s previous arrangements with these countries.

The UK is required to meet the terms of the agreement by 1 December 2023, and the Government are using powers contained in Section 3 of the Professional Qualifications Act 2022 to do so. Enshrining this system in legislation is necessary to ensure that the UK fulfils its obligations under international law. Without these regulations, some regulators will not have the necessary legal powers to meet the requirements of the agreement. These regulations will come into force at the same time that the UK’s EU-derived system for recognition of professional qualifications ends. This will ensure clarity and a smooth transition for regulators and professionals.

This system does four things. First, it requires regulators to recognise comparable professional qualifications. Secondly, it enables regulators to refuse to recognise comparable professional qualifications where certain conditions are met. Thirdly, it prescribes compensatory measures which regulators can require a professional to take in certain circumstances. Finally, it prescribes the procedure for applications to obtain recognition. Taken together, this means that professionals that benefit from the agreement will have a clear, predictable and timely route to practise a profession in the UK.

Crucially, professionals with UK qualifications will also benefit from similar access to the three countries. Agreements such as these allow the UK’s world-leading professions to be exported around the globe. I should also note that the regulations contain amendments to UK and devolved legislation which tidy up the UK’s statute book. These amendments remove references to EU-derived legislation for recognition of professional qualifications.

I must inform the House that after they were laid in Parliament on 17 October, a correction slip was issued to address a minor formatting issue in Regulation 3(1): in the definition of “medical regulator”, the numbering started at (d) instead of (a). This has been corrected and incorporated into the version on legislation.gov.uk.

It remains the responsibility of individual regulators to set standards for their professions and to decide who meets these standards. Some of my noble friends may recall that during debates on the then Professional Qualifications Bill, concerns were expressed about regulator autonomy. I will understand if my noble friends have similar concerns about these regulations. However, I strongly assure your Lordships that these regulations protect regulators’ autonomy.

Under this system, regulators will need to decide whether a qualification from Norway, Iceland or Liechtenstein is comparable with a UK qualification. Regulators can refuse to recognise the qualification where certain conditions are met, such as the applicant having inadequate English language proficiency. The regulator can prescribe compensatory measures which a professional can be required to take. I assure your Lordships that regulators remain the experts for their professions under these regulations. They remain responsible for setting standards for their profession, assessing applications and deciding whether an individual can practise in the UK.

My department has consulted carefully with regulators while developing the regulations, fulfilling the duty to do so under the Professional Qualifications Act. In January 2023, the former Department for Business, Energy and Industrial Strategy ran a targeted consultation with regulators. We sought their views on the implementation approach and draft regulations. Respondents were generally supportive of the proposed approach to implementation, and most indicated that adapting their processes would not be costly or burdensome. My officials engaged extensively with regulators on their feedback. My department appreciates this close involvement, which has been invaluable in developing the regulations. Through the consultation, some regulators indicated that their existing sectoral legislation was insufficient to enable them to comply with the agreement. Therefore, we have included amendments to sectoral legislation in these regulations for a small number of professions.

This is a UK-wide instrument. The Government are using concurrent powers in the Professional Qualifications Act to implement this agreement in areas of devolved competence. This approach has been taken after careful consideration and extensive engagement with the devolved Governments. The Government judge it necessary for these regulations to have a UK-wide remit, for two reasons. First, all regulators across the UK must be covered by legislation for the UK to be compliant with the agreement. Secondly, UK-wide legislation ensures that regulators across the UK have the necessary legal powers to put this new system in place. This approach means that the experience of professionals with qualifications from Norway, Iceland and Liechtenstein seeking recognition in the UK will be predictable and consistent across the four nations. Importantly, it also means that these professionals will have legal recourse if a regulator is not following the terms of the agreement.

In June 2023, the Department for Business and Trade ran a consultation with the devolved Governments. The consultation sought views on the implementation approach and the draft regulations. The Government published the report on the consultation on 13 October 2023, fulfilling our duty under the Professional Qualifications Act. This provided the devolved Governments with the opportunity to identify necessary amendments to devolved legislation and explain whether the regulations would be workable in practice.

Amendments submitted by the devolved Governments were incorporated into the regulations. In their responses, the Scottish and Welsh Governments opposed the UK Government exercising the concurrent powers in the Professional Qualifications Act without their consent. Although our preferred approach has always been to secure the agreement of the devolved Governments, we have decided to proceed without their full agreement to the instrument.

To conclude, when the UK’s free trade agreement with the EEA EFTA states was signed in 2021, it was clear that British businesses valued the opportunity that it provides with close trading partners and the opportunity that it creates to continue exporting services overseas. These regulations bring into force the recognition of professional qualifications system contained within this agreement, meeting our obligations under international law. I commend the draft regulations to this House.

I thank the Minister for his introduction, which has, I think, answered my questions. As when we discussed the Bill in this House, my concern is very much with the status of the devolved Administrations, the issues and implications for the devolved Governments and the different systems that exist within the nations of the UK for both professional qualifications and the education system that feeds into them.

I have one small remaining question. The Minister referred to English language proficiency. If there were to be a requirement within a particular profession for the Welsh language in Wales, would that also be satisfactorily recognised in these regulations?

I also thank the Minister, the noble Lord, Lord Offord of Garvel, for outlining and explaining the regulations, which are largely uncontentious. I will pick up a few of the issues that the Secondary Legislation Scrutiny Committee—the SLSC—raised. I am sure that the Minister will be well aware of them but they are worth touching on.

Before that, on the regulations themselves, do the Government expect the new RPQ system to have any bearing on immigration levels? If it is expected to be net neutral overall, are there any particular sectors that may be affected either way, positively or negatively? Are there any staffing gaps? The Minister talked about exporting British talent around the globe but are there any particular gaps within the UK that we are hoping to use these measures to help fill, in terms of inward migration?

The Department for Business and Trade says that this may require regulators to change some of their current processes. The Government acknowledged this impact but a full impact assessment has not been carried out or produced. So have the Government made any assessment of the extent of the requirements? In his introduction, the Minister said that they expect it to be minimal, but can he elaborate on that a little? Can he highlight any particular areas where that impact would be most severe?

Also, with the new timeframe, from my reading of the Explanatory Memorandum and the SLSC papers on this, I think there may be some issues for a few of the regulators with the reduced timescale for turning round their regulations.

I turn to the Secondary Legislation Scrutiny Committee’s report and some of the areas it touches on, which the Minister has raised. The Department for Business and Trade said that the consultation with regulators received “generally supportive” feedback. This is one of the areas on which the SLSC takes the department and the regulations to task, because there was no publication of the consultation. In fact, the committee goes on to say: