Crispin Blunt MP and APPG for CBD Products recommends ‘Legitimate Single Formal Point of Contact for Entire Industry’.
3rd meeting of the APPG for CBD Products 26th April 2022
On Tuesday 26th April, the day of the 3rd meeting of the APPG for CBD Products, Crispin Blunt MP forwarded a letter presented to him and Baroness Zahida Manzoor as Chair and Co-Chair by Nick Morland, CEO of Secretariat Tenacious Labs, to Parliamentary Under-Secretary of State for Science, Research and Innovation, George Freeman.
In Mr Blunt’s cover note, Ccd to Minister of State for Brexit Opportunities Jacob Rees-Mogg and Minister of State in the Home Office Kit Malthouse, amongst others, he said:
“Dear George,
We are writing to you as co-Chairs of the APPG for CBD Products to request an urgent meeting to discuss the inclusion of the industry’s views around the new regulatory framework, that will determine whether this industry has a bright future in the UK or will most of destined for bankruptcy. The situation is summarised in the attached letter received from the group’s secretariat. The secretariat has pulled together 70% of all firms within the UK CBD industry through the APPG’s Secretariat Advisory Board (SAB) to inform this letter and we are very grateful to them for their help.
The UK CBD industry is greatly concerned about the negative impact of current regulation and the difficulty of getting industry views – as a whole and beyond individual pressure groups – to Government. It proposes that this is coordinated through the APPG but we seek your views as to how to best address the issue. We know from your work on the Taskforce on Innovation, Growth and Regulatory Reform report to the Prime Minister of May 2021, that you are seized of the opportunities. We are writing to you conscious of the wide spread of interest across Government, but believe you are in the best position to pull this together given the anticipated support of your Secretary of State, the Minister for Brexit Opportunities, the Minister for Drug Policy, the Minister for Public Health, the Secretary of State for the Environment and Rural Affairs, and the Prime Minister. We are copying this request to them and the Food Standards Agency. The Industry very much see you as their champion and hope you have secured the coordinating lead to enable their success.
The CBD sector is already estimated to generate £690 million in annual sales for 2021 and it is the industry’s view that long-term growth could result in this sector becoming equivalent in value to the Scottish whisky industry. The Scotch Whisky Association estimates their industry in 2021 directly employed 42,000 people, with 7,000 of these jobs benefitting from being in the rural economy, and had an annual gross value added of £5.5bn. The UK finds itself with an enviable opportunity to take advantage of a leading position in the nascent stages of this novel burgeoning international industry which is already heavily consumer demand driven and is crying out for clear and practical regulation. Getting CBD product regulation right is an opportunity to create thousands of jobs, draw in millions of pounds of investment and build on our international bioscience reputation, whilst simultaneously creating a safe consumer market which enables consumer choice.
Both myself and my co-Chair, Baroness Manzoor, kindly request that you meet with us and the secretariat at the earliest opportunity to discuss what would be the most appropriate way to creating a single point of contact for the industry.
We presume it will be a shared assumption that the UK’s CBD industry should be characterised by appropriate legislation and regulation that enshrines support for bio sciences innovation, business development with the necessary protection for the consumer.”
A selection of members of the Secretariat Advisory Board to the APPG for CBD Products gathered in the Houses of Parliament 26th April 2022
The original letter from Nick Morland, CEO of Secretariat Tenacious Labs read:
“Dear Crispin and Zahida,
Recommendations for Government Engagement with APPG for CBD Products and the wider CBD Industry
Background
I am writing in my capacity as CEO of Tenacious Labs, Secretariat to the Westminster All- Party Parliamentary Group for CBD Products. The Secretariat is backed in turn by the Secretariat Advisory Board, which is an open forum of industry players with an agreed set of processes rather than a single entity.
Members of the Secretariat Advisory Board include the Medical Cannabis Clinicians Society (MMCS), the Cannabis Industry Council (CIC), the Cannabis Trades Association (CTA), the European Industrial Hemp Association (EIHA), the Scottish Hemp Association (SHA), the British Hemp Alliance (BHA) and the Cannabis Services Advisory Board (Jersey), plus some corporates totalling 701 UK businesses which is approximately 70% of all active cannabis related businesses in the UK.
In the last month alone we have also spent time in Scotland hosted by Food Standards Scotland, in Wales hosted by Aberystwyth University and in Jersey - where I also chair the government’s official industry representative, the Cannabis Services Advisory Board.
Engagement
The response across the board in all jurisdictions from the civil servants, politicians, businesses, trade bodies etc. has been, and continues to be, universally positive, constructive, professional, responsive and sensible. The recognition that legislation and regulation is both a necessity and an essential foundation to long term premiumisation is well understood, as are both the need for and benefits of getting the process right over time.
We explicitly welcome the Novel Food initiative and are now actively organised to contribute promptly and effectively to the series of important steps stretching out ahead.
Opportunity
Cannabis - from high protein biomass from marginal land for less flatulent cows, via moisturiser for a gardener’s stiff hands and their arthritic dog, all the way through to the far more complex issues around the significant economic benefits from recreational THC and medical advances around MS and epilepsy - is a complex new industry. Cannabis’ worldwide turnover is expected to reach £69bn in 2026 from a pre-fully legalised level of c. £20bn today and expected to continue to growing by over 6% p.a. (faster in the premium segment). For comparison Whisky’s worldwide turnover is steady at £69bn as of 2021 (although again showing growth in the premium segment).
The Scottish Whisky industry is a commonly used benchmark - although Cannabis will be far bigger for the UK economy and British Isles, it’s a sensible starting point for the short and medium term. This long-term premium industry provides 42,000 permanent high-value jobs, the vast majority for people who don’t necessarily want to go to university or move away from home, and 7,000 of the 42,000 even in deprived rural areas.
That this self-evident positive also comes with £5.5bn of trade per year, much of it international exports, makes it more attractive still. Cannabis is similar but potentially bigger.
Analysis
The UK is lucky enough to find itself in a peculiarly strong position to become the global powerhouse if there is the will to provide the framework. That is to introduce clear balanced inclusive processes around legislation and regulation, regarding updating POCA, consumer protection, quality standards, appropriate definitions and limits, research and development, banking, agriculture, insurance, London Stock Exchange listings and all the rest.
Everyone understands that economic benefits and consumer choice must tempered by consumer protection and taxation. No one involved wants to be seen to be standing in the way of employment, legislation that underpins a long-term premium position or national & international economic & health benefits. The Cannabis industry stands on the cusp of becoming something special in the UK, a once-in-a-generation chance to drive a new cycle of growth, investment and jobs.
Conclusion
An appropriate, transparent, genuinely industry-representative forum to work as a single point of formal contact with all of the necessarily interested parties is needed now. Specifically one that can be asked by the UK government - together with and directly supported by the devolved governments - to provide a plan for the establishment of a timely and valuable new long-term premium Cannabis industry along similar lines to Scotch Whisky.
Recommendation
The next stage is then the practical one of building on the depth and breadth of work undertaken by multiple single-issue pressure groups - aggregating them into the legitimate single formal point of contact for the industry.
The Secretariat to the Westminster APPG for CBD Products, supported in turn by the established process directly including 70% of all active UK businesses, are prepared to take the lead as guided by and answerable to the properly constituted APPG. The challenge is explicitly not in preferring the Secretariat Advisory Board’s 701 crossindustry voices over others - however healthy a democratic margin the 70% gives - but how to structure the big tent for all.
Next steps
Co-Chairs seek a meeting with Kwasi Kwarteng and George Freeman to discuss potential ways forward. These could include a consultation process built around the APPG secretariat (but offered here as one basis for discussion of establishing process of consultation) which would need to:
(1) establish terms of reference for the work required appropriate for completion by 21 July
2022
(2) the scope to be the feasibility and methodology of establishing the UK as the world
market leader in the premium Cannabis Industry using Scottish Whisky as the benchmark
(3) the APPG to assess the parameters required, economic benefits and consumer
protection
(4) where there are concerns, how mitigating measures can be easily introduced
(5) the APPG to seek public evidence from the full range of interested parties, concentrating
first on industry proposals and second on the input of those who will be responsible for their
action, including but not limited to the following -
(a) the full range of the broad industry - industrial, agricultural, whole plant, isolate etc.
(b) devolved governments - in particular Scotland and Wales
(c) Jersey, having under Home Office stewardship already started to introduce primary
legislation
(d) Home Office
(e) DEFRA
(f) FSA
(6) in all cases including (a) to (f) above the APPG Co-Chairs will formally request meetings
with a clear mandate and purpose as the single official initiative
(7) all stakeholders to commit to attending (or membership as appropriate) the APPG on a
monthly basis from May
(8) the Secretariat to establish and maintain a website on the APPG’s behalf updated
weekly from 1 May 2022
Regards,
Nicholas Morland
Chair, Secretariat to the APPG for CBD Products”
