Hallmarking Act 1973 (Application to Palladium) Order 2009

I thank the noble Lords, Lord De Mauley and Lord Livsey of Talgarth, for their questions, which I will attempt to answer. The noble Lord, Lord De Mauley, asked: given that there was a public consultation, why do we expect there to be public interest in the hallmarking of palladium? Having been through the legal requirement of carrying out a consultation, we believe that the announcement of the hallmarking of palladium will be of interest, because this is the first time that a new metal has been hallmarked since 1973. It will bring the existence of palladium to the attention of the public and the consumer. It will have a positive effect because of palladium’s relative potential as a lighter metal than some of the others that are usually used for jewellery. The use of palladium, a lighter metal, will make possible more modern designs for earrings, for example. That will cause some interest and be of marketing benefit to the trade. The noble Lord is right in his comments about the United States. My understanding is that we do not have any data on the volume of imports of unmarked goods into the United Kingdom. I will look into whether the department has any further information. If we do, I will write to him. I should stress that US marks are not recognised in the United Kingdom and must be assayed on import into the UK. As for other EU countries and hallmarking, the position is that some countries do and some countries do not. It is based on a country’s own national legislation on hallmarking. I agree with noble Lords that that identifies a potential difficulty in terms of a common approach towards the hallmarking of jewellery and other goods across Europe. As for imports into the United Kingdom, the hallmarks that the United Kingdom recognises as equivalent can be imported without further costs and without them being further assayed. The marks that are not recognised by the UK must be assayed. I will write to the noble Lord, Lord Livsey, to give him a full list of the countries that hallmark across the range of precious metals and those that do not. As for the effect on the market, noble Lords have already highlighted the volatility of the price of palladium and of a number of other metal commodities over the past year. Our analysis of the market leads us to suggest that the current rapid increase in sales of palladium products will continue independently of the volatility of the price, for the reasons that I mentioned concerning its suitability for more modern jewellery. We believe that this change to the regulations is necessary because of the way in which we have seen the trade volumes move. We have been given unofficial trade figures by manufacturers—I stress that they are not government figures—which indicate the number of kilograms of palladium traded per month. They show an increase from 1 kilogram of palladium for July 2008 to 3 kilograms for July 2009, and then to 4.5 kilograms for August 2009. So we have seen a threefold increase in the trade volume of this material, which is why we believe that the order is necessary. The impact on the market for catalytic converters is something that I will have to write to the noble Lord about when I have done some investigation. We do not envisage that this order will have a significant material impact on taxation receipts. I believe that I have answered all the questions raised. If I have missed any, I will write to noble Lords. I thank noble Lords for the light that they have shed on this important issue through their questions. I am sure that the industry will welcome the development in the regulations for hallmarking and that consumers will see the benefit in the development of new and effective products. I commend the draft order to the Grand Committee.