Grand Committee
Infrastructure Bill [HL]
Lord Whitty
“National Infrastructure Plan: energy efficiency
The National Infrastructure Plan shall be altered to include investment in measures in the domestic and commercial sectors delivering reductions in energy use through increased energy efficiency and investment in such areas shall be subject to the same criteria as other items for inclusion in the Plan.”
Lord Whitty (Lab)
My Lords, in moving Amendment 94 I will speak also to Amendment 94A. The first amendment is in my name and that of my noble friend Lord Judd while the second is solely in my name. Both deal, essentially, with the same issue. The first is a general statement of principle—that energy efficiency should be considered alongside other options for the delivery of infrastructure improvements and dealt with on the same basis. The second goes into rather more detail and sets various conditions, in that any proposals would have to meet carbon targets, contribute to the reduction of fuel poverty and be compatible with and considered alongside other investments in energy infrastructure. I do not mind which of these two amendments the noble Baroness accepts. I would be quite happy with either or both, or perhaps even a better one from her, but the essential point here is that energy efficiency is underregarded when we look at the programme for national infrastructure.
The Government have produced a lot of papers on infrastructure. The one in June 2013, which was not the first, has effectively nothing about energy efficiency. There is a brief obtuse reference at one point to the Green Investment Bank but nothing else. The National Infrastructure Plan itself, which came in December 2013, had a whole chunk on energy going through all the different aspects of energy, from the heat programme through to all the different bits of generation. It mentioned the strategy for fuel poverty; the noble Baroness answered a Question from the noble Lord, Lord Ezra, a few days ago, saying it was going to be published in spring 2014, so we are slipping on that. It waits until right to the very end of the provisions on energy before it mentions smart meter rollout, the only aspect of energy efficiency which is mentioned therein. There was then another document, a finance update for the infrastructure plan, which was delivered in March this year. Again, that did not mention energy efficiency.
It is important that investment in energy efficiency is seen alongside “big bucks” investment in generation and improvements in the energy system itself. Delivering energy efficiency improvements has the best return, pound for pound, of any investment in energy in terms of carbon saving, of cost saving to the consumer and of energy saved. A relatively recent Cambridge Econometrics study showed that very clearly. It also is more labour-intensive and therefore creates more skilled and semi-skilled jobs. It benefits the whole of the country rather than part of the country, as some of the infrastructure projects do on the transport side and some of the energy ones on the employment side. Hinkley Point will be great for west Somerset, and I very much approve of it being there, but it does not benefit employment much anywhere else in the country.
I mean a range of things by energy efficiency investment. My principal concern, as noble Lords will recall, has largely been on investment in the housing stock, both in terms of retrofit and of future build. However, that is only one part of it. There are other parts of investment in infrastructure and retrofitting investment that the Government have not touched at all, which relate to commercial buildings and to the use of energy more generally in our economy and on the industrial side.
The very latest document, which the Minister was kind enough to send us last Friday, Delivering UK Energy Investment, is a superb publication. It is possibly a bit glossy, given the history of DECC in this regard, but it has obviously decided that it has to present itself effectively. The last section of the document contains a lot of information on energy efficiency, although some of it is subject to some rather specious claims. In fact, it starts out by saying that, in terms of energy intensiveness, the UK is the “least energy intensive” of all G7 economies. That, however, reflects the structure of the economy and is not a like-for-like comparison, certainly as regards our housing stock, which is universally recognised as being one of the least efficient in Europe.
The energy system itself is subject to some outmoded forms of transmission and distribution which will require attention. That is, indeed, mentioned in the document, but only in the context of the electricity demand reduction dimension of the capacity mechanism, on which we had a lot of discussion during the passage of the Energy Bill. I think Members on this side of the Committee, and many other noble Lords, find this somewhat lacking in precision as yet, but we should be grateful that it is there. However, the broader concept of energy efficiency is referred to in relation to smart meters, investment under the Green Deal and money spent under the ECO. In my opinion it gives a slightly exaggerated view of how effective that is going to be. I am in favour of the ECO. However, the provisions introduced by the Government in the last few months in response to the Prime Minister’s attack on “green crap”, which was presumably an organic predecessor of the “green blob”, means that we now have the ECO spread out over a much longer time period. It is therefore less rapid and less of an investment than was the case as it was originally conceived. Meanwhile, of course, a lot of the predecessor schemes have disappeared. Although the Government are putting some money into that provision, it is relatively low level.
Although these things are going on, they are not considered in the same light as the investment in large-scale generation, the whole of ERM or, indeed, the capacity mechanism, and they are not assessed on the same basis. As I said at the beginning of my remarks, the return on energy efficiency measures, as analysed by countless economists, is much greater than the return on generation investment, whatever the form of generation we are talking about—offshore wind, nuclear, or, indeed, gas or coal—and in carbon- saving terms it is also greater. It seems to me therefore that there is a gap in our approach to national infrastructure on the energy side, although some of this applies also to the transport side because improvements in transport energy efficiency ought to be considered in the same light. If we are looking at how public and private money is spent and directed on infrastructure, investment in energy efficiency should be considered on the same basis, at the same time, with the same degree of urgency and with the same degree of government backing. That is not the case at the moment. These amendments are directed at ensuring that the widest aspects of energy efficiency are reflected in that strategy—a strategy to which the Government rightly give priority in terms of public spending on a public policy, but also one which will directly benefit the consumer and businesses operating within the UK. It will also benefit them early whereas many other investments will take five or 10 years to pay off in terms of energy supply. Therefore it will improve the economics of British industry and business in general.
So the arguments for energy efficiency in all its forms being up there as part of the infrastructure programme are pretty irrefutable. I am not saying that the Government have done nothing on this front but the failure to consider energy efficiency in the same light has meant that such programmes are regarded as lower priority and less exciting, and they are not given the same degree of importance. My amendments attempt to begin to change that. The next version of the National Infrastructure Plan, due at the end of this year or the beginning or next, should reflect this very explicitly with a whole section on energy efficiency rather that it being regulated and only partially covered in the documents. I believe that DECC recognises this but it needs wider recognition across government as a whole so that we are not dependent solely on a glossy DECC publication—welcome though that is. Right in the heart of Treasury thinking on industrial policy, energy efficiency should be up there and treated in the same way as the other infrastructure priorities. I beg to move.
Lord Jenkin of Roding (Con)
My Lords, this is an important amendment. I was glad that the noble Lord, Lord Whitty, gave the Government credit for what has been done. A good deal has been done. I am sure that the noble Lord will have studied, as I have, the paper produced last month on the Energy Savings Opportunities Scheme. It now has its own acronym—ESOS. One can read quite a lot about ESOS.
I was very encouraged the other day by reading of a meeting attended by my noble friend Lord Deighton, the Commercial Secretary to the Treasury. To quote from a press release, my noble friend,
“today said he is ‘extremely attracted’ to the idea of reframing home energy efficiency as one of the UK’s top 40 infrastructure priorities”.
The noble Lord, Lord Whitty, may well be pushing at an open door. My noble friend has very considerable influence on these matters and comes to this House and his job with a very great reputation for what he succeeded in doing in the case of the Olympic Games. As most noble Lords will recognise, he is a figure to be regarded with considerable respect not only in this House but outside it, too.
My noble friend was asked by the Green Building Council chief executive, Paul King,
“whether the Government needed to change the mindset on home retrofit from thinking about 26 million small problems to one major infrastructure opportunity. Lord Deighton said he was ‘seduced’ by the idea of reframing the debate on energy efficiency and that ‘Government should lead’ on the agenda”.
Coming from that source, I hope my noble friend on the Front Bench will sing from the same hymn sheet. It is perfectly clear—as the noble Lord, Lord Whitty, eloquently put it—that this policy has no down side and very considerable upside attractions if one can reach the point where one needs to invest less in production because one is saving more and using energy a great deal more efficiently. That seems to be highly desirable.
It is very interesting that an organisation called the Energy Bill Revolution, which sent me a brief on this recently, quotes research from Cambridge Econometrics showing that energy efficiency schemes,
“outstripped all other investments and tax breaks by creating over 70,000 jobs by 2015, and the boosting of GDP by 0.2%”.
It goes on to say that the key reason for those figures is that the high level of job creation is because it is much more labour-intensive than many other forms of energy investment and much less material-intensive than most construction projects.
Lord Judd (Lab)
My Lords, I often find myself in agreement with my noble friend. Not infrequently, I find myself in strong agreement. On this occasion, I find myself in particularly strong agreement with his amendment and was very glad to see it.
I am delighted that the noble Lord, Lord Jenkin, for whom I have tremendous respect, although I do not spend a lot of my time agreeing with him on political matters, spoke on this amendment. It is one of the nice things about this House. I like him and have come to respect him tremendously over the years. It is good to have a word of good wishes from him on the subject matter of the amendment.
This is an incredibly important amendment. We want to have the energy necessary to enable Britain to be an effective economic power. We also, I hope by now, have central to our strategy a concern for the well-being of our children and grandchildren and of future generations in terms of climate change. There is therefore a tension between the demand for more energy and the demand to make sure that the well-being of future generations is protected.
When we are discussing climate change, all the right things are often said, but when we come to legislation that is highly relevant to delivering the goods in terms of what is necessary in policy, it gets to the bottom of the pile or gets forgotten altogether. I am very glad that my noble friend drew attention to some of the publications in which this was true.
I shall give one personal experience which rather disturbed me. A couple of years ago, I was at a gathering of businessmen not far from where I live. They were discussing energy and the contribution our part of the world could make to the energy production that is necessary. In a good way, the discussion began to be quite personal, and people started talking about their ambitions for their children. One person after another was saying how they would love to see their son or daughter going into engineering as a career and how in Britain we need to take this more seriously. They talked about engineering this and engineering that, but not one said, “I would love to see my son or daughter working as an engineer in the sphere of energy conservation and energy efficiency”. It is something to do with our culture.
I know that I go home with a sense of anxiety that we are saying the right things about climate change and the rest of it, but so much energy is still wasted at night here in our building. It is better than it used to be, but it is still going on—and that profoundly disturbs me, in the context of leadership. We want to get into the strategic planning and the context in which everything is taking place—firmly there, at the head of the stated principles—the fact that energy conservation is a priority that must be given pride of place.
I am very glad that my noble friend has introduced this amendment. I am looking at the clock. If we have not completed our consideration of this amendment by 4.30 pm I hope that I will be forgiven by the Committee for leaving. The Ecclesiastical Committee is meeting at that time for a particularly important matter—to approve the Synod’s recommendation on the ordination of women bishops—and I really feel that on such an historic occasion those on all sides of the Committee will forgive me if I have to leave before the end of the debate on the amendment.
Baroness Maddock (LD)
My Lords, I add my support to the noble Lord, Lord Whitty, in trying to get energy efficiency as part of our infrastructure plans. I am also very pleased to support my noble friend Lord Jenkin. Interestingly, I also knew of the quote from the noble Lord, Lord Deighton, and, if he had not used it, I would have done.
I realise that it is always difficult for a Minister to accept anything and I am not really expecting the noble Baroness to do that today, but in the light of what has been said it is important that she can confirm that she will talk very seriously about this to her colleagues. It is clear that she has other ministerial support—it is not just coming from the people talking here in Committee. So I hope that she can do that.
I am particularly concerned, coming from the north-east, for the job creation opportunities of energy efficiency. We have already seen it happening there. One problem is that the economy may be booming in the south-east but it has not been booming quite so much in the north-east. This is one area in which we do quite well and, if the Government take this seriously, we can do even better.
I have one little point to make on a comment made by the noble Lord, Lord Judd, about the energy efficiency of this building. In the Royal Gallery there is a display about the works that they are doing in the Houses of Parliament. I noticed just this morning that in renewing the iron roofs they are putting in insulation.
I support what has been said in general and urge the Minister to take this seriously and perhaps come back on Report with something that we can all support.
Lord Deben (Con)
My Lords, I apologise for missing the first minute of the speech of the noble Lord, Lord Whitty. I support the amendment. It has always seemed to me that there is a need to find a way in which to make energy efficiency more attractive to politicians, and I think that the noble Lord may have discovered that mechanism. The trouble with politicians is that they like boys’ toys, and it is always better to build something big that you can point to, so that in your dotage—which of course none of us is anywhere near—you can say to your great-grandchildren, “I built that great monstrosity there; it was one of the reasons why I felt that I had done something”. I fear that that is quite deep in the psyche of politicians. It is always easier to build or make something and then to have something to point to. Very often, those are important activities, but it always means that energy efficiency is at the bottom of the pile.
When I was the Minister responsible in the Department of the Environment, there was a tendency to ensure that those who dealt with energy efficiency were perhaps not the most exciting of people—not perhaps as thrusting or pressing as those who dealt with the big projects. I am sure that that is no longer true and that now we have people of immense thrust, but it is important to give them some help and support. This amendment does that.
We have had today the welcome decision by the Government that the Committee on Climate Change was indeed right to say that there is no basis for changing the fourth carbon budget. So we know what we have to meet. In that circumstance, energy efficiency is a crucial part. Members of the Committee should refer to the document that the climate change committee presented to Parliament only last week—I declare an interest as its chairman. It is interesting that when we produced our review of climate change action over the past five years—it also looks forward—no one from the global warming body that opposes these things was present. Nobody was there to find out the facts. Nobody bothered to turn up. It is worth saying as often as possible that those who deny climate change or dismiss its importance rarely appear to listen to the facts. In that document we make it clear that in fact the Government have so far, with their partners, met their targets. That of course has been helped, if that is the right word, by the recession. Again, we should congratulate the Government on saying that they are not going to take advantage of that additional success by reducing the requirement in successive carbon budgets.
It is a good idea to say when Governments get things right, particularly if one is going to say something about getting it wrong. The bit they have got wrong is that we have not got the energy efficiency operation anywhere near where it has to be if we are to meet our budget. As my noble friend Lady Maddock rightly said, the Minister will find it difficult to accept this amendment here and now. However, perhaps I may end by saying why I hope she will make sure that it is accepted before the Bill is passed. By making the amendment part of our infrastructure programme, we give to it precisely that attraction—the big picture—which it lacks if we are talking about a whole series of small things, which is the point that my noble friend Lord Jenkin made and which the noble Lord, Lord Deighton, himself made in his recent intervention.
I very much hope, therefore, that my noble friend will accept that this issue is crucial to meeting our carbon budgets. Those budgets have been reaffirmed today. Would it not be a good thing to celebrate that reaffirmation by accepting in principle, if not in practice at this moment, that the amendment should be part of the Bill?
Lord Teverson (LD)
My Lords, my noble friend Lord Deben will be delighted to know that last week I quoted his report several times in this Grand Committee in relation to zero-carbon homes. There were some useful data there. Also in this Grand Committee last week I welcomed the report by DECC on energy investment. The DCLG Minister at that time, though helpful, was not so interested in it. However, I congratulate DECC on its work on this issue, together with the £45 billion in investment. As the noble Lord, Lord Whitty, said, there is a whole section about energy efficiency in the report. It is the final section, and it would be nice if it moved up to the top, but it is indicative that recognition of the importance of this area is increasing.
The report, whose language I really like, states:
“There are £45-£60 billion worth of … investment opportunities”
still to be had. That looks good and we think, “Great, we can do more”, but what it means is that there is still some £65 billion-worth of work yet to be done on energy efficiency in the UK.
I can see that the Government are going in the right direction on this, but it is important to hardwire these issues into the decision-making process. This amendment provides one of the ways of starting to do that.
Lord Cameron of Dillington (CB)
My Lords, in rising to support this amendment, I should first declare my interests as a farmer and landowner with renewable schemes on my property which I am involved with financially. I try to encourage others to get involved in such schemes as well. I want to talk in particular about the future of our housing infrastructure. I hope that a lot of new houses are going to be built over the next few years and it is therefore important to think about these issues at this stage. I want to take a particularly narrow line, which I hope the Committee will excuse.
It may be that my remarks would be better targeted at Amendment 95ZBB tabled by the noble Baroness, Lady Eaton, but I have only just come across it so I am not quite sure what it is all about. The difference between some of the continental housing developments I have seen in recent years and ours is the much greater frequency of community heating schemes in both rural areas and new build housing estates in towns. For some reason our developers seem to shy away from community schemes, preferring individual gas-fired boilers or, in rural areas, oil-fired boilers fitted in each and every house. That must be very inefficient. I know that we have the renewable heat incentive, but clearly it is not quite enough and it tends to be used in community buildings such as churches and village halls, as well as on farms and in factories so that the heating system can be linked to one or two houses. These are quite small schemes. Plugging a new estate of 400 or 500 houses into a community heat source is really quite rare.
Lord Teverson
It may be useful if I tell the noble Lord that the RHI is not applicable to new builds, and there is a distortion because of that. We do not see community heating systems in new builds because the RHI does not apply to them.
Lord Cameron of Dillington
I thank the noble Lord for that explanation, which certainly underlines the point I am trying to make. As I have said, I hope that lots of new housing estates are built over the next few years, so DECC and DCLG ought to look very carefully at this issue and consider how community heating schemes might be improved. The advantages are huge. For a start, they are much more efficient and thus would justify proper investment either in the new type of boiler that is required or in the overall management of the heat. In rural areas, for instance, it is often hard to justify piping gas into villages, which is obviously the cheapest form of heat, but it could be much more worth while in cases where there is a major community heating unit so that gas can be brought in to provide fuel for that one particular source of heat. That is certainly better for climate change than putting oil boilers into each and every house because that involves a huge waste of oil and energy.
Lord Deben
Does the noble Lord also agree that the ideal use of pumps, both air and earth pumps, is in new build? And yet, as my noble friend has pointed out, that is precisely the area which is not covered by the present arrangements. It would make a huge difference if that were to happen and it would certainly help towards achieving really eco-friendly new homes.
Lord Cameron of Dillington
I thank the noble Lord for his intervention and I am glad that my remarks are invoking a certain amount of support. I totally agree with him: ground source or air source heat pumps, particularly on a large scale, are very efficient in climate change terms due to the reduction in the emission of greenhouse gases. Obviously one of the disadvantages is that you have to cost in the piping of hot water. Even with photovoltaics, the cost of those come down by something like 24% every time the number is doubled. There is a huge advantage in encouraging this because I am sure that the cost of pipes would come down, too.
Another advantage is that, as technology changes and sources of heat and efficiency go up and down, it takes only one change to get the whole community on to the most efficient fuel, burner or heat source. That is much more likely to happen than changing all the heat sources in all the houses. As I say, as our housing infrastructure catches up with the nation’s needs over the next few years—as I really hope it will, particularly in terms of affordable housing—DECC and DCLG ought to get together and ensure that these sorts of scheme are encouraged in new-build houses.
Baroness Maddock
My Lords, I support the noble Lord, Lord Cameron, in looking at community heating. I recommend that he looks at the district heating scheme in Southampton set up many years ago. I was a councillor at the time. Alan Whitehead, the MP there, and I set that up together. Barratt Homes put a new block of flats on to that scheme. We are going back nearly 20 years, but those schemes work.
There is a housing estate in Pimlico that still has a district heating scheme. I live in a flat in Dolphin Square when I am here and am really sorry that the owners of the square came off that scheme. Ever since, we have had gas boilers. Sometimes we do not have hot water. That never happened under the district heating scheme. Those are two schemes that have been successful. I wish the Government would use some of these examples to encourage other people to take this scheme up, as it works. People used to say that it was very difficult for the reason the noble Lord gave—they want their own boiler. However, it has been done successfully and where people have it, they are very satisfied.
Baroness Worthington (Lab)
My Lords, when you have had such a rich and excellent debate, you find yourself in the position where everything you were going to say has been said before you by very eminent and noble people. I thank everyone for their contributions to this debate.
We are very supportive of this amendment in principle. I look forward to hearing from the Minister some, I hope, positive words about how the Government will take this proposal forward in principle and introduce it into the Bill during its passage. It is clear that, when we look at the Infrastructure Bill as a whole, this area represents something of a missed opportunity under this Government. Of the pipeline of infrastructure projects in the UK that the Treasury has collated into its Excel spreadsheet, more than half are energy projects. It is the single biggest sector in terms of the value of projects in that list. Energy is central and fundamental to any infrastructure policy. Yet here we are with not very much in the energy part of this Bill to start with. A few amendments have been added but this is really a missed opportunity to set out a very strong and strategic direction.
I am sure that the Minister will point to the fact that we spent much of last year talking about energy in the energy market reform package but that is still being implemented. On Thursday, we meet to discuss some of the detail of the statutory instruments and there are still significant issues that were debated during the process that are unresolved. I would argue that energy efficiency is one of them.
I am delighted that the noble Lord, Lord Deben, raised the fact that today we saw the Government finally remove the question mark hanging over the fourth carbon budget. It was a recommendation from the Committee on Climate Change that was accepted but a rather insidious caveat was inserted that it would be subject to review. This has been hanging over the carbon budgeting process for some time. Today we saw final clarification that the fourth carbon budget will remain as drafted, as it is in law, and will not be subject to review. That is a very good thing. I particularly extend congratulations to the noble Lord for the work that I am sure he and his committee did in trying to ensure that the Government saw logic on this issue. I also commend the Government for listening to logic and ruling out any changes to that fourth carbon budget.
However, as the noble Lord pointed out, this now has quite serious implications for policy. The first implication is that we must—must—secure a 40% greenhouse gas reduction target in Europe if we are to have a chance of meeting our targets in the traded sector. In the non-traded sector, which means the heat market and the transport market, we will have to up our game significantly and improve the energy efficiency of our transport and heat networks. That is really the nub of this amendment. For too long, we have ignored those essential components of energy policy. How we heat our buildings, homes, offices and industries and our transportation have been sidelined in favour of big glamorous projects in the power sector. There has been—although I hope it is shifting—a perception in the department responsible for energy that real men build power stations. I have heard anecdotally that there have been posters to that effect in certain parts of the department. I hope that they have now been expunged. We have women in that department now, which is great, and a new member in the shape of Amber Rudd who I am sure will contribute greatly.
Energy is not just about cutting ribbons on large projects. It is much more complex than that. It involves massive amounts of infrastructure, which extends all the way to the buildings, housing, homes and roads that we use to transport ourselves and to live and work in. Those aspects of infrastructure should be front and centre in any infrastructure project. It will have escaped no one’s attention that energy security and reducing our reliance on imported energy are of huge importance, particularly in current times. The most sensible way to do that is to reduce the amount of energy you need to use in the first place. That is why energy efficiency is now receiving far greater attention at European level and why we in the UK should similarly up our game on this aspect in meeting our carbon budget and in helping people to occupy, live in and work in buildings that are fit for the 21st century. I see this as fundamental to the question of infrastructure. How we transport ourselves and what we live in is part of our infrastructure. It ought to be in the Bill.
There is another important point. My noble friend’s amendment covers existing infrastructure and new infrastructure. It is important that if we are embarking on this large programme of infrastructure spend, we do so wisely with energy efficiency front and centre in everything we do. This amendment is not simply about retrofitting existing infrastructure. It also requires us when we are embarking on infrastructure projects to think carefully about the energy efficiency of those projects.
People might be considering how we make this real and what energy efficiency looks like. I have three examples. I mentioned our housing stock: we have among the worst housing stock in Europe. It is appalling that a country of our wealth and history should have people living in fuel poverty in damp and unheatable homes. This has to be stopped. We have to make sure that our housing stock is upgraded to give us warm and healthy homes to live in. It is not just that. There are also large swathes of commercial and retail buildings that could be re-engineered to become smart buildings and upgraded so that they use energy wisely and minimise the amount they use.
There is also lighting. There is huge potential for reduction in emissions and energy demand from lighting from the new LED lighting that is coming on board. When we are building roads and extending infrastructure, we should be planning to have the most efficient and up-to-date technologies that will save us money in the long run.
I do not want to detain the Committee any longer. This has been an amazing debate—I thank all noble Lords for their contributions. I am very much looking forward to the Minister’s response. I hope that before the legislation reaches the statute book, we will see a positive response to these amendments.
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con)
My Lords, I agree with the noble Baroness that this has been an excellent debate. Everybody has spoken with great passion. Each and every one of us shares a common approach to making sure that we deal with energy efficiency in the round, not just for people in fuel poverty but as a commitment from our country to our carbon targets. Before I respond to the amendment moved by the noble Lord, Lord Whitty, I shall put on record for my noble friend Lord Deben and the noble Baroness that some of us are not playing with boys’ toys and are not interested in them but have spent a lifetime making sure that the subject that we are so passionate about is properly addressed. For those who like wearing helmets, good luck to them. I am just not one of them.
Lord Deben
I am impressed by the Minister’s statements and very much support them, but I do not quite understand why it would not be satisfactory to include this in the Infrastructure Bill. If we are doing all these things, perhaps the Government will not find it too onerous to do so. Surely she would agree that it would mean that we would put it in the right context, with the other things being done on infrastructure. I hope that, despite her feelings before the debate, she will accept that the debate suggests that it would be worth while thinking about this again and putting something in the Bill. I cannot see that there is any down side to that; I see a lot of upside, but as yet I cannot detect a down side.
Baroness Verma
I thank my noble friend for his intervention. However, I would err on the side of caution: if we do not look at this in greater detail, we might inadvertently restrict ourselves from looking at other technologies that may come on stream by putting into legislation things that are going to be restricted because we have mandated it in the legislation, when we are already doing many things that meet what noble Lords are asking for. It would probably be much more constructive to be able to say that this would not be necessary, given that we are already doing it. However, as with all things, I am very happy to talk to noble Lords outside the Room to see where they feel that I am not fulfilling this condition.
I would like to respond to the noble Lord, Lord Cameron, about new build and RHI. I do not have the details for that here, but perhaps he would allow me to write to him and send copies to other Members of the Committee.
I hope that the noble Lord, Lord Whitty, will withdraw his amendment.
Lord Whitty
My Lords, I thank the Minister for that reply. I am very appreciative for all the support from noble Lords around the Committee on the principle of these amendments and, perhaps, even more delighted that in his absence the noble Lord, Lord Deighton, appears to have pre-empted me and got into the heart of the Treasury the precise intention of the amendment—that whatever else we do with energy efficiency, it needs to be considered on the same level, at the same time and on the same criteria as other infrastructure projects.
There is a lot of experience around this Room, but there is an essential truth in what the noble Lord, Lord Deben, said and what my noble friend Lady Worthington said in a rather sharper tone—that infrastructure projects narrowly conceived have an attraction to Ministers that pushes out priorities that might be given to projects that are slightly more mundane but equally effective and important for the future of our economy and society.
It goes a long way back. As a very junior civil servant in the late 1960s, I was in the Ministry of Technology. It and the NRDC, as it then was, had energy efficiency as one of their objectives, but it was pretty low down the list. We had all sorts of sexy and exciting things such as Concorde and nuclear power stations to deal with, and it rarely rose above the surface. Subsequent departments, although they quite often had quite a lot of people working on energy efficiency, did not really improve that status. I become Minister for Energy Efficiency in 2001, and it was a very frustrating job, partly because it was isolated in a different department from other energy issues, but whatever the structure of Whitehall, all Ministers who have had that responsibility have found it frustrating.
In my opening remarks, I spoke about importance and priority, but status is also important. I hope that now we have energy located in one department—it has taken a few years to put it together—that the civil servants dealing with this issue are accorded status equal to that of those who are dealing with big power stations and other infrastructure projects and that that is reflected in the way in which the department operates with other departments around Whitehall, and in particular with the Treasury, which, until I heard the remarks of the noble Lord, Lord Deighton, repeated by the noble Lord, Lord Jenkin, and the noble Baroness, Lady Maddock, I had thought was still going to be an inhibition. It appears that it is now going to be a fairly substantial supporter of the intention of these amendments. I would have thought that that might carry some weight with Ministers at DECC.
We can argue about how much is being done, and a lot is being done. We can argue about its efficacy and balance, but that is a separate argument. We are saying that we have a national infrastructure plan that is revised every year or two—I hope that will continue—and that the projects within it gain status by their inclusion in terms of capital expenditure and political attention which other projects do not have. If we are to bring together all the different aspects of energy efficiency and put it on the same basis as other infrastructure projects, it should be explicit. Indeed, in the energy section, it is arguable that it should be at the top because the degree to which you are successful at energy conservation and energy efficiency defines the degree to which you have to have new generation projects and speed up distribution and transmission.
I do not accept the Minister’s view that because a lot of things are being done and are reflected in important reports from the Government, the department, the Committee on Climate Change and other bodies we should ignore what lies behind this. Infrastructure is the word of the moment as all political parties approach the general election. I hope that whoever are the Government after the general election, infrastructure improvement remains up there in lights and if other things are up there in lights—“lights” is probably the wrong word to use in an energy debate—energy efficiency needs to be there as well. Whoever produces the next national infrastructure plan should include energy efficiency in an important place within that programme. At the moment, it is not there.
All this is not technologically specific. It is simply saying that whatever programmes there are for energy efficiency, they need to be up there in parallel and justified on the same cost-benefit or whatever analysis applies to other infrastructure projects. I do not think that on reflection the Minister would have any real difficulty with that. It appears she has the support of the Treasury. She has two or three months to think about it before we come back after the Summer Recess. I would have thought that that was ample time. If she does not like my phraseology or we need to make it more clear, defined and acceptable to her colleagues, I am quite happy with that, but the burden of argument in the Committee is that she must come back with something and that the next infrastructure plan must reflect that. I beg leave to withdraw the amendment.
Baroness Worthington
Baroness Worthington
The amendments in this group are essentially probing in nature to allow us to debate in more detail the one part of the Infrastructure Bill that touches on energy. It is worth reiterating that I find it curious that there is not more interest in the energy aspect of infrastructure and energy efficiency when more than half of the projects in HM Treasury’s pipeline are energy related; the biggest sector by value is energy. Even so, when this Bill was published it had only a few clauses related to what is in reality only a small aspect of policy, which is the community right to buy. The next business tabled by the noble Lord, Lord Jenkin, will allow us to have a slightly more principled debate about whether this is the right approach, while these amendments seek to elicit from the Government a little more clarity on what the thinking is.
It is clear that other countries have pursued the community ownership of energy far more effectively than we have. We need only look to Germany where there has been a huge uptake of renewable energy projects across all parts of the economy; a large proportion of them are community owned and backed. The Germans have had a far more successful experience of deployment of renewables as a result, and it is clear that this is something which needs to be explored. I am sure that other noble Lords have received various briefings on this aspect which make it clear that there are lots of different ways of securing community involvement ranging all the way from sole community ownership, whereby a community forms a co-operative or group of which it is the operator and investor, to the other end of the spectrum, which might be some kind of mandated share or stake being sold to the community. It seems that with these enabling regulations, the Government have decided in their wisdom to select just one of those options, and that is the right to a stake in renewable projects.
The first amendment, Amendment 94AA, is clearly probing in nature. We understand that if it were to be accepted, a great many consequential amendments would be necessary. The reason we tabled it was to explore with the Government why it is that community renewable projects are being singled out for this measure. In the future, renewable energy will cease to be a term because it will be integrated into energy as we know it today. A whole host of technologies are hidden behind the term “renewables”, but renewables themselves are no different from other forms of energy: they produce heat that keeps our businesses and homes running by providing power for our communities. Over time, renewables will need to stand on their own two feet and be integrated as a normal part of how we produce electricity and heat. Yet here we have a set of provisions that single renewables out as some kind of special element which needs to be governed in a certain way under a series of quite complex procedures. I find it deeply regrettable that this is not about making community energy work. It is more about providing Tory MPs and candidates with a nice soundbite to use on the doorstep: “Don’t worry. If there is a renewables project you don’t like, we will force them to sell some of it to you”. This feels like a rather cynical and quite narrow way of tackling a hugely important issue.
I do not want my speech to be interpreted in any way as being against community ownership or community involvement in renewables, and certainly I do not want it to be seen as being against renewables, but I am slightly disappointed and curious as to why the Government have selected such a narrow piece of legislation to push forward in this Bill. Amendment 94AA asks why renewables are being singled out. There will be other forms of community energy that are not from renewable sources, and this provision could apply to those as well. Why does it apply only to renewables?
The second amendment, Amendment 94AB—this touches on the debate that has just gone—opens up to community ownership projects that will reduce our demand for energy and our carbon emissions through energy efficiency, demand reduction and demand management. We have just had a lengthy debate about how the demand side of this always gets overlooked. However, here we are again, with precisely the same thing happening and renewables being singled out, but with a complete blind spot when it comes to community involvement in the infrastructure of our community and how our houses, buildings and communities are made more energy efficient. This is a huge oversight because, in reality, those energy efficiency projects will be far more successful, stand on their own and give payback periods that are probably shorter. That would excite a community and get it involved. They are also likely to need the involvement of the community because they might involve multiple sites. I can see no reason why Amendment 94AB should not be part of government thinking on this. I will be very interested to hear what the Minister will say in response.
Amendment 94AC has a similar theme. Here, we are just probing to find out why the Government’s guidelines initially indicate that the technologies classed as renewable in this case are solar and onshore wind. We do not see why offshore projects and offshore renewable projects could not be included if they are near to coastal communities. If coastal communities look out on to a wind farm, why should they not also be part of it? They could also be involved in wave and tidal projects. Is offshore not considered to be part of that and, if not, why not? We strongly suggest that it should be as inclusive as possible on all projects.
Amendment 94AD is another probing amendment to find out the Government’s view on whether facilities can be exempted and on what would be accepted as an exempted facility. I would just like clarification about what circumstances would mean that a facility would be exempted. Amendment 94AE is about the age qualification for this right—again, simply to probe and receive more information. It is quite an enabling set of regulations and we would like a bit more detail.
Similarly, the final amendment, Amendment 94AF, is to just test whether charities—I think it is fair to say that, under this Government, charities have felt slightly hard done by in recent times—are eligible to be part of this and whether they are classed as a community group and to ask for clarification on that. There are a whole range of amendments here, and I would like responses from the Minister on all of them. If she is unable to give them now, perhaps she will be kind enough to write.
The most important point I want to get across is that we have a massive opportunity here to move towards a much greater degree of community involvement in renewable energy and, indeed, in energy in general. That way, people will appreciate more what goes into creating energy, where it comes from and how they can make money from their involvement, thereby generating excitement. There is a whole raft of things that the Government could have done to make that happen. We want to see it happen because we want to see how we can match what Germany has done in terms of community engagement and up the rate of acceptance and deployment. This part of the Bill does not do the job, and we have serious concerns about it. I think we will be able to go on to debate that in a little more detail in the next group, but I look forward to the response to this group of amendments. I beg to move.
Lord Teverson
This is a major step forward. It is a very positive step. I have sympathy with the amendment, but at least this enables us to get on and start down this road. If we find out how to make it work, we have opportunities to broaden it out. However, there is a question about why we are restricting it to the energy field. What about putting up a housing estate or a multiple retail store next door? The same argument applies.
Baroness Worthington
The difference is that we are going through something of a transformation from a situation where we have a limited number of generators dotted around the country, often in the most far-flung places, so that people do not have to engage with energy, and are shifting to a much more diverse, devolved and distributed system. Therefore, we have, as is widely acknowledged, political issues about managing that transition. That is the difference.
Lord Teverson
As I said, I am sympathetic and understand that. However, that is also true of other parts of the economy. and I am just making the point about how far one could extend the argument. I hope that we can prove that this works, although there is still quite a challenge, and I have an amendment on some bits of it later on. At this point, I just want to say that it is an excellent initiative and that at least we are on the first few steps of this process, even if we do not get perfection straightaway. I fully understand the points made by the noble Baroness, but this is a great start and we should get on with this, prove that it works and move on after that point.
Lord Cameron of Dillington
My Lords, I, too, support the idea of community involvement in projects. As I said in my Second Reading speech, I support Amendment 94AA in view of the possibility of local opposition causing projects to fail. Fracking is very controversial. It seems to me that if you could involve the local community in a fracking project in the same way as the Government are trying to do with renewables, it would be very beneficial.
Baroness Verma
My Lords, I take this opportunity again to thank all noble Lords for their excellent contributions. In addressing this rather large group of amendments, I hope that I can respond to many of the points the noble Baroness raised. If I do not do so, I undertake to write to her.
Amendment 94AA seeks to extend the scope of the community electricity right to include all electricity generation facilities. While the Government strongly support community engagement in relation to the development of all energy projects, we are clear that these provisions should apply only to renewable electricity generation facilities. I would like to set out the reasons for this.
First, this measure is part of our broader approach for increasing community investment in renewables, as set out in the Community Energy Strategy. The policy was developed specifically to tackle the imbalance between national and local benefits that characterises renewable schemes. In general, there tends to be widespread support for renewable electricity developments at a national level, but this is not always reflected at a local level where the impacts are felt directly by communities. Enabling communities to invest in their local renewable electricity schemes will mean that they can gain a greater share of the financial benefits and, more importantly, feel a greater sense of ownership of schemes being developed on their doorstep. This will help to increase public engagement, acceptance and support for renewable projects at a local level. What is more, developers will also stand to gain. Experience in this country and abroad has shown that where communities have a financial stake in a local renewable development—the noble Baroness cited Germany in this regard—this often translates into less opposition and a quicker, cheaper development process.
There is already a voluntary approach that is currently developing a framework for increasing shared ownership. Only if this is not successful would we consider exercising the backstop powers. It would therefore make no sense to expand the scope to include all electricity generation projects when both the policy objective and the voluntary approach are focused solely on renewables.
On Amendment 94AB, I remind noble Lords of the importance of reporting on actions to reduce energy demand and carbon emissions. I recognise that there are many forms of community action that can make a difference to reducing our country’s carbon emissions and managing the demand of energy. The Community Energy Strategy that we published recognises the benefits of putting communities in control of the energy they use. Furthermore, it sets out how communities can get involved in reducing, generating, managing and purchasing energy.
In addition, through the Community Energy Call for Evidence, the department committed to commissioning an external research project specifically focused on energy demand and distributed energy. This research project has now concluded, and we will publish the findings shortly. While these are very important elements of growing the community energy sector and tackling climate change, they are not directly connected with the implementation of the community electricity right regulations.
Baroness Worthington
My Lords, I thank noble Lords who spoke on this amendment and the others in the group. I thank the Minister for her response. I cannot say it has done much to assuage my cynicism. I feel that this is more to be used in leaflets on doorsteps in Tory constituencies than anything else. That said, I understand and am grateful for the detailed responses.
This feels a slightly too restrictive interpretation of what we want to achieve with community engagement. I fear that it is slightly motivated by a desire to make renewables seem like a very special case and that there is something about them that is inherently difficult which you have to live with on your doorstep and therefore you will be given a special right which does not apply to any other type of energy project. I do not know that that is necessarily going to be a good thing.
The noble Lord, Lord Teverson, made a valid point about how far you go with this right to buy. I do not quite share his logic in saying that this might not be perfect but we should get on with it. This is so far from perfect that I am not sure that that logic applies.
I am very grateful for the responses. I will follow with interest whether charities end up being included on the list. I am sure that if they are not other people will be reading Hansard with great care and will follow up on that issue in particular. I do not follow the logic of the Government’s approach: “We have said it this way; therefore it has got to be this way”. There was a circular logic in some of the answers: “We have not included energy efficiency; therefore we cannot include energy efficiency” and “We do not think it should apply to offshore; therefore it does not apply to offshore”. Those are not principled responses because they just say, “This is what we are currently doing and therefore we are legislating to do what we are currently doing”. That is not necessarily the right approach.
Baroness Verma
My Lords, I have said that there will be times when formal consultations are held, so it will be useful to wait and see what the results of those formal consultations are.
Baroness Worthington
I thank the noble Baroness for that, and indeed it will be interesting to see what comes back from stakeholders and whether offshore generators will accept that this is a necessary provision. It feels like this is less about securing community engagement and more about trying to send a message along the lines of, “We know that renewables are really difficult and we are sorry. We will try to do something about them”. Anyway, I look forward to the debate on the next group of amendments.
Lord Teverson
I am absolutely fascinated by the political analysis because I see this as something completely different. I do not know whether what the noble Baroness is saying suggests that this is good or it is bad. I do not think that it is some sort of Conservative move to persuade electors. Let us be quite clear: certain parts of the coalition want to stop onshore wind in its tracks. That is not the case for the whole of the coalition, but for some, and this is not an answer to that. This is a way of making it a positive thing and moving forward the programme of changing some of the ways that it works. This does not seek to give up, it tries to make it something far more workable. There is no greater advocate of wind power in the countryside than I. I revel in the fact that I can see at least 50 turbines from my house, which luckily for me is on the top of a hill where it is windy—but without a turbine.
We know that certain people and communities are quite legitimately concerned about these issues, so this is a way of involving them and giving them part of the benefit of the schemes. I do not think that it is at all cynical. If we could push things further, I would do that as well, but even so the political analysis is wrong. It is a positive development and if it is successful, it will inevitably be rolled out more widely. I agree that there probably are issues around shale, possibly more around exploration than production, but again there is something cynical in this political analysis. We all understand where cynicism comes from, but in this instance it is absolutely wrong. I am not talking about the dynamics of the two political parties which make up the coalition, but the dynamics of the coalitions between different government departments, along with other things. As is the case in all of politics, it is a broad church. This is a solution that will start things off. I want to reject all this cynicism.
Baroness Worthington
I thank the noble Lord for attempting to reject my cynicism. We know that there is an issue with the coalition Government. We know that one department is pushing renewables while another department is calling all the renewables projects in and objecting to them. I do not think that I am being paranoid in saying that there is a problem in the signals being sent to investors in renewable energy projects. It is quite apparent in the statements being made by different Ministers.
Baroness Verma
My Lords, I apologise. We should move on to the next group. However, I want to clarify that it is healthy to have these debates. The noble Baroness’s own party is also having them. To make this into a political debate is, I think, wrong, because the underlying premise of the noble Baroness’s amendment is what we are all trying to achieve—greater community engagement.
Baroness Worthington
I do not dispute that. I say again that I have nothing against community engagement—in fact, I positively encourage it for all the reasons the noble Lord, Lord Teverson, has outlined. As I said, it clearly helps people to move forward with renewable energy. I am simply saying that this approach is very narrow and that it inevitably puts an administrative burden on to a certain class of developers which does not apply to other developers. That is my concern. I am sure that we will talk about these issues in the next group of amendments. I do not think that I am wrong to express a healthy degree of cynicism and I am glad that I tabled these probing amendments so that we could have this debate. It is now on the record, so let us see how we get on. I am sure that it is something which will evolve over time. I beg leave to withdraw the amendment.
Lord Jenkin of Roding
My Lords, I apologise to my noble friend the Minister, the noble Viscount, Lord Simon, and to officials for having put down notice of my intention to oppose the Question that Clause 26 stand part so late, but after I studied the amendments that had been tabled it seemed that this gave an opportunity for a wider debate on the whole question of community involvement. I am very grateful to the noble Baroness, Lady Worthington, for recognising that when she moved the previous amendment.
At Second Reading on 18 June, I expressed my worries about the rush to a statutory scheme when the voluntary approach seems already to produce a very good result. Since then, I have read the draft report of the Shared Ownership Taskforce, which was published a week later. One thing is abundantly clear, no doubt because of the terms of reference the task force was given by Ministers: it is wholly based on the voluntary approach to community involvement. There is no mention in the report of legislation or even the threat of it.
Yes, there was at one time pressure from some voluntary organisations to say that this would work only if the Government forced firms to give community involvement, but those organisations are not saying that now. I have had representations from some of them to say no, they are wholly in favour of the voluntary approach which seems to be working. Therefore, why do we need this so-called backstop? The Government’s argument—no doubt, we will hear this again this evening from my noble friend—is that we want the voluntary approach to work. However, to quote the words of the noble Baroness from a few moments ago, only if that approach is not successful would the Government introduce the backstop. I have a number of questions on that.
Before I come to them, I draw the attention of the Committee to the letter written by the Secretary of State last April to the chairman of the task force, Maria McCaffery, and to the task force vice-chairman, Rebecca Willis from Co-operatives UK. The Secretary of State set this out with complete clarity. He wrote:
“It is my view that shared ownership is better achieved through the flexibility and adaptability of a voluntary process and I welcome your efforts to make this a reality”.
Lower down he wrote:
“It is therefore my intention that the backstop powers will not be overly prescriptive. Regarding the timescales … I would like to reassure you that there is no intention that these powers would be exercised before 2016, if they are exercised at all”.
That is the Secretary of State’s letter, and I attach some importance to it because it is clearly what he meant. However, I fear that the reference to “before 2016” rather gives the game away. The Bill will, I hope, be law before the end of this Parliament—probably early in 2015. So what is that reassurance actually worth? It means that the Government really want to introduce this as soon as possible. That is really very bad psychology.
My first question to the Minister is: where is the evidence that the voluntary approach is not working? All the evidence that I have received suggests that it is actually working rather well. The task force itself gives examples of various models of share ownership in Annexe A of the draft report. They include: split ownership schemes, such as the Baywind Energy Co-operative in Cumbria and the Fens Co-op/EDF scheme near Spalding in Lincolnshire; shared revenue schemes, such as the Falck-Energy4All schemes, with many sites across the country, and Drumlin, with several sites in Northern Ireland; and joint ventures, such as the Neilstan Development Trust-Carbon Free Developments wind farm in East Renfrewshire. This may not be a comprehensive list but it shows that there is a good deal going on.
The question I therefore ask my noble friend is: do the Government keep a register of shared ownership schemes that are being planned, introduced and operated? Can she give me the names of any schemes where shared ownership has been refused? Is there any evidence of that? It may well be that there is, but no one has put that to me. I will be interested in her reply.
The task force’s draft report lays huge importance on the value of flexibility: different solutions for differing circumstances. I have quoted what the Secretary of State said—he did not want to be “overly prescriptive”—but is it not absolutely inevitable that statutory regulations are bound by their very nature to be prescriptive? Examples of this are already in the Bill, such as limits on the size of a scheme, limits on the size of the voluntary share, limits on the kinds of organisation that can represent the community and limits on the nature of the stake that may be held. One only has to read subsequent amendments to realise that these proposals are already causing considerable concern. So the Bill is bound to be prescriptive. The simple fact is that a voluntary system can embrace a wide range of possibilities. Indeed, the noble Baroness, Lady Worthington, and my noble friend a moment ago indicated that there would be a wide range of possibilities for voluntary community involvement.
A statutory system is bound to force future developments into a legislative straitjacket. I cannot believe that that is the right approach. Furthermore, it sends a very clear message—this point has been made to me forcefully by the industry—that, despite all their reassuring words, Ministers simply do not trust the industry to deliver. My noble friend was quite right when she talked about the main motivation for a voluntary approach being to smooth the path to local support and reduce opposition, and there is plenty of evidence for that. That is the main attraction of a voluntary approach for firms and the local community. Yet only a few hours ago I received a note from Ofgem. It made the following point:
“However, we believe there is a question about whether community energy will necessarily provide a positive outcome for consumers”.
For that we wait to see. The note continues:
“We are watching with interest around what happens with the taskforce on community energy (which we do not sit on). We may have concerns about using our enforcement powers around this if the voluntary approach does not work”.
Coming from the main regulator, those are powerful words. I hope that my noble friend will respond to that.
Ministers then say, “Don’t worry. We are going to make this very flexible in all the regulations”, but when are we going to have sight of those regulations? At Second Reading, I asked that we should see the regulations before Report. Since then, we have had the report of the Delegated Powers and Regulatory Reform Committee, which examined the Bill, but not the regulations, of course, because we do not have them yet. It is encouraging to note that paragraph 7 of that report states:
“We accordingly do not find … the arrangements for Parliamentary scrutiny of the exercise of the powers, to be inappropriate. But we are conscious that, even with the amplified outline of the regulatory framework that Schedule 5 affords, the House will not begin to get a clear idea of the real shape and content of what would be a novel statutory regime until the Government provide details of the provision that would appear in instruments made under clause 26. We therefore express the hope that the Government will make available to the House, preferably before Report Stage, as much as possible of the provision that would be included in the regulations”.
That is a pretty strong recommendation from the committee.
What have we had since then? We were all working very hard on Sunday. I was talking to some of the Minister’s officials about this, and about what I was going to say, and the Minister sent me a letter, also dated Sunday last, in which she answered some of the points that we have made. Under the heading, Future details on the regulations, she writes:
“In terms of providing further details on the regulations, as my officials explained, we are strongly supportive of the voluntary approach to shared ownership and would not want to prejudice the models and approaches coming forward by drafting any secondary legislation now. The provisions as they stand retain the future flexibility in order to allow us to respond to changing circumstances, and in particular to take on board any lessons from the voluntary approach”.
I think that means we are not going to see any regulations before Report. If I may say so with great kindness to my noble friend, I do not think that she is going to get away with that. The House will want to know the details of the regulations that the Government are taking powers in the Bill to introduce. I find this a very difficult situation. So, my next question to my noble friend is: does that response mean that we are not going to see the regulations before Report? I would be grateful if she would give a very clear answer to that.
My Amendment 98AB is grouped with the provision we are discussing. There is to be a framework document but, again, we have not seen it. The draft task force report sets out the timetable for monitoring and review. I will not weary the Committee with that because I am sure that many noble Lords will have seen it already, but it is clear that there is to be a significant process of review before there is any question of introducing the backstop provision. The task force draft report states:
“Six and twelve months after the publication of the Shared Ownership Taskforce’s recommendations”—
that will be this September—
“the Taskforce will conduct reviews of commercial renewable energy developers covered by the voluntary Framework”.
Then, as the noble Baroness has told us, there will be a period of consultation, which will take time, and then there will be a period after the consultation is complete before the Government can possibly produce a response, so there will have to be a period of at least a year, but I would suggest probably two years, before there is any question of introducing a statutory scheme. However, the Bill states that the Government want to have the power within two months of it becoming law. Why on earth do they feel that that is necessary? Two years is plenty of time, and psychologically it would be right for the industry. It would feel that this really is a backstop provision and not something that the department is bent on introducing as quickly as possible.
Indeed, I would go further than that. To threaten the industry that there will be statutory powers—a narrow statutory straitjacket—when it will be pursuing a wide variety of voluntary participation schemes by local communities seems to be a very dangerous psychological error. I do not think that the Government understand how businesses react to that sort of thing, but they want to do it, and therefore they have taken the powers to do so within two months of the Bill becoming law. I cannot believe that that is the right approach.
Let me make it clear that I totally support the concept of community involvement in schemes of this sort, and indeed I have some sympathy with those who were asking in the last amendment why it was being limited to onshore renewables. We have heard that it may be extended to offshore later. In France, local communities are incentivised for major nuclear developments by being given cheap electricity. It is provided for the whole of the surrounding area. That is an extremely effective form of community involvement. It does not mean ownership, but it is something that provides a considerable community benefit. I am not suggesting that we should necessarily imitate that here, but again I totally support the notion of getting communities involved, as it were, emotionally rather than politically or financially, in the success of local energy schemes. Indeed, as noble Lords have suggested, this might even go wider than energy. However, to hang over the head of industry the threat that if it does not, it will be subject to a legislative straitjacket, is a deplorable misjudgment of the way industry behaves. I look forward to hearing my noble friend’s response.
The Duke of Montrose (Con)
My Lords, I have considerable sympathy with what my noble friend Lord Jenkin has said, but I wonder if I might be allowed to introduce a small element. This is the first clause we have considered on the question of energy generation, and it also happens to be the main clause in the legislation that will apply to Scotland. Moreover, I always keep an eye open for this particular subject. Can the government ministerial team tell us at what stage it expects the legislative consent Motion to be dealt with in the Scottish Parliament to make sure that what we are passing here will apply to all parts of the United Kingdom?
Baroness Worthington
I thank the noble Lord, Lord Jenkin, for a characteristically thorough, thoughtful and detailed speech on this very important issue. I hope that if I attain his high level of expertise, I will be able to make similar speeches during my time in the House of Lords. I look forward to the Minister’s response. Some very important points of principle have been raised. Indeed, we aired some of the same concerns when considering the previous group of amendments. I support the noble Lord, Lord Jenkin. He sought to point out that essentially this feels like a solution in search of a problem. There is a predetermined view which says, “This is what we want to do, so now let us do it”, on not a great deal of evidence and the potential to send a rather unfortunate message to an industry that should be encouraged to expand. Given the Government’s usual approach to regulation as reflected in their Red Tape Challenge, which insists that if a new regulatory burden is put on an industry another one should be taken away, can the Minister tell us which of the renewables industry’s current regulatory impediments is going to be removed in order for this to be introduced? This is an impediment on industry. I am very grateful to the noble Lord, Lord Jenkin, for quoting Ofgem. That confirmed the fears I had. How is this to be administered? Will it be able to be enforced? What are the costs involved in doing this? Is it justified by any evidence that there is a problem that is not being addressed through the much more flexible, creative and, I hope, successful voluntary approach?
I strongly support the noble Lord, Lord Jenkin, and his opposition to the clause, which I am sure is designed to elicit reassuring comments from the noble Baroness that this is not a straightjacket that the Government are rushing to introduce and that we can take some time to get this right.
Baroness Verma
My Lords, I am extremely grateful to my noble friends Lord Jenkin and the Duke of Montrose, and to the noble Baroness for her contribution. This debate on Clause 26 allows me to lay out why we consider that what the Government are doing is absolutely the right approach. At the same time, I will address the matter of my noble friend’s Amendment 98AB, which seeks to delay commencement of the provisions by two years.
As we all agree, shared ownership is a key way to galvanise support and acceptance from local communities. That is critical for the future of the renewables industry. I have said previously that this Government have set out a logical and sensible approach to achieving that, first, through a voluntary means. Then, only if that is not successful, would we consider bringing forward legislation—and that only following a formal consultation.
With that in mind, I will respond to the points that my noble Friend Lord Jenkin raised today. First, I do not agree that the Government do not trust industry to deliver the voluntary approach. As I said before, the Government have set up an industry-led task force to drive an increase in shared ownership. We hope and believe that shared ownership will be achieved in that way. If we do not trust industry, as my noble friend suggested, why would we have set up a task force in the first place? I welcome the fact that the Shared Ownership Taskforce is—
Lord Jenkin of Roding
I should have explained that the question of the Government giving the impression that they do not trust industry is something of which I was informed by RenewableUK. One of its senior officials is a chairman of the task force. I have to assume that she understands that lack of trust as well. Perhaps she did not put it in her report but nevertheless her organisation made it perfectly clear to me that that is how it interprets this threat of legislation.
Baroness Verma
I am grateful for my noble friend’s intervention but reiterate that we are working closely with industry. That work, through the Shared Ownership Taskforce, is going well. We commend the publication of its draft report. However, it would be naive to expect all those in industry to welcome this with open arms. Taking legislative powers has helped bring this matter to the forefront. The possibility of legislation has encouraged industry to take this matter seriously and provide the commitment necessary for the voluntary approach to succeed. The Government’s firm view is that the backstop powers are needed precisely in order for the voluntary approach to work. It is basically a call to action.
My noble friend made the point that there is nothing stopping Government legislating, even if the voluntary approach works. I would like to be absolutely clear that that is not our intention. The backstop powers would be exercised only if the voluntary approach does not succeed. In determining success, we will be guided by the task force and the outcome of its review in 2015. The Secretary of State for Energy and Climate Change addressed the task force to reassure it on that point. In addition, he provided further reassurance that, in order to give sufficient time for the voluntary process to take effect, there was no intention of exercising any power before 2016, if at all. In the Queen’s Speech debate in the other place, he reiterated this point:
“Since we are pursuing a voluntary approach, the power in the Bill is a back-stop. The community energy sector was clear that the voluntary approach should be given a chance to succeed, and I agree”.—[Official Report, Commons, 5/6/14; col. 139.]
Baroness Worthington
This reminds me of a debate that we had on the Energy Bill, where there was a similar backstop measure. On the decarbonisation target, for example, we were asked to accept a form of wording that said it could not be set until 2016. Perhaps something like that could be formulated for this Bill to give people reassurance that the intention is that it will not be done until 2016.
Baroness Verma
As with all things, I listen with great care and will, of course, having done that, discuss this with my officials. If we can improve the writing of legislation, I am always happy to look at that. However, I reiterate that this is basically a backstop power. We expect industry to deliver, but let us not be naive: there will be parts of industry that do not and will not, and we therefore need to have that measure in place. Finally, exercising this power would, of course, be subject to affirmative resolution procedures and would therefore require the consent of both Houses.
The Delegated Powers Committee’s view is that these provisions are not inappropriate, in particular since they provide for the affirmative parliamentary procedure to be used. The committee hoped that we would provide as much information as possible on the shape and content of secondary regulation, and we are currently considering what we can do to satisfy this. As I am sure my noble friend is aware, when I am asked by the Delegated Powers Committee, I try my level best to ensure that as much information is available to it as possible.
I have spoken previously about the importance of not prejudicing the models coming forward through the voluntary approach and the outcome of any formal consultation. It is for these key reasons that we have not set out the finer details of implementation within primary legislation. However, I take on board my noble friend’s concerns and hope that I can offer him some comfort. We are currently considering the recommendations of the committee and, in particular, whether we can provide further briefing on what any secondary legislation might look like. The Shared Ownership Taskforce is due to publish its final report in October. Following that, we could consider how its final approach influences the details of implementation, but going any further than this now could prejudice the outcome of the task force’s consultation, which we would be loath to do. I hope to provide an update to the Committee on this matter before Report.
The amendment proposed by my noble friend would introduce a two-year delay to the commencement of these provisions, which I do not believe is the right approach. I will set out a few reasons for that. First and foremost, the current timescales associated with the voluntary and mandatory approaches are aligned. The policy as a whole creates the right impetus and drive to achieve our objective of substantially increasing shared ownership from next year. The potential to introduce backstop powers is intended to nudge industry to ensure that the voluntary process is sufficiently robust, but it also sends a very clear signal that we want to see offers to communities being made on the ground from 2015.
By contrast, the approach proposed by my noble friend would mean that when the voluntary approach is reviewed in 2015, if it were found to be unsuccessful, it could be at least until the end of 2017 or early 2018 before the powers could come into force. This would follow a formal consultation and the development of secondary legislation which is inconsistent with the approach set out in the community energy strategy.
The Duke of Montrose
The reason I raised it is because renewable energy is a devolved matter and there is always this conflict in the energy area about whether it is a renewable energy question or a fossil fuel matter.
Baroness Worthington
Will there be any regulatory deregulation on the renewables industry to compensate for these new regulatory powers? What are the administrative and cost implications of this for how we are going to police and monitor it?
Baroness Verma
I apologise for not being able to respond to the noble Baroness. I had a note to say that I would be writing to her because it was a detailed question. I will ensure that Members of the Committee get a copy.
I hope that I have been able to reassure my noble friend Lord Jenkin as to why Clause 26 should stand part of the Bill and convince him that delaying commencement of these provisions is not the right approach.
Lord Jenkin of Roding
My Lords, I take some comfort from what my noble friend said in response to this short debate. She said she will do her best to see that we get some indication of what is going to be in the regulations, and I very much welcome that. I understand her argument about not wanting to tie herself down. The Government would tie themselves down by taking a legislative power or even indicating legislative powers some years before they have to become operative because there may be many lessons to be learnt before that time. It is quite clear that we are going to have return to this on Report.
I was slightly surprised and disappointed that my noble friend told the Committee that we are not going to get the final report from the task force until October. It is having a consultation phase—and I refer to the first page of the task force draft report—before publishing the final report in September, because the task force would like to seek wider views. The difference between September and October is quite crucial, because we will resume the sittings of this Committee in October, perhaps within a day of reassembling. That will be followed in due course by Report, at which stage we will presumably wish to come back to this, having moved beyond this part of the Bill. So this is really rather important. I hope that my noble friend might be able to convey this to the chairman of the task force. She said September, and there are people in the House who would like it to be September. It should not be like so much that the department has done and slip from month to month. That is not the right way in which to do things. If you say that you are going to publish on a certain day, that is the date on which you should publish. I find the readiness to accept slippage of that sort, sometimes running into many months, rather distressing—but there we are.
I had one representation this morning from a group or a firm that is anxious that the task force is laying down prescriptive models for community participation. It sees a whole range of other things that it could do, which would achieve exactly the same objective—namely, aligning the interests of the community with those of the investor—which do not appear to be considered at all. It would want to have at least what it calls “shared generation”, in which the commercial operator ensures a proportion of the energy generated from a project is discounted off the energy bills of the houses and businesses in a specified local area. As I said a few moments ago, they have been doing that in France for years with the big nuclear power stations, and it seems to work; it provides precisely the readiness of the local community to host what otherwise might be an unwelcome, large and intrusive investment. It would be entirely appropriate for something like that to be available in these circumstances, so this is a moving scene. The minute that we encompass it in statute, it needs primary legislation or at least amendments to subordinate legislation to widen the scope.
This is unfortunate, but I accept one point that the Minister made. She set out her stall and said that there is a backstop provision in the Bill, so I can now understand why, as she put it, it would send the wrong message if we were now to take it out. I can see that, but perhaps it would have been clever not to have gone down this path at all. We might have relied on the voluntary system to take the whole thing forward and then, if it was not successful, started talking about legislation. However, that is not what has happened. We cannot take this any further this afternoon, but I hope that I have made my views clear.
Baroness Worthington
Baroness Worthington
My Lords, this has been grouped with a similar amendment from the noble Lord, Lord Teverson. It concerns the one and only bit of finer detail that we see in these clauses. The Minister has just said that the Government did not want to do anything that prejudiced the findings of the task force and that they were having a consultation. A lot of helpful information has been provided, but if we are intent on not prejudicing the voluntary approach, the outcomes of the task force or the consultation and do not wish to bind ourselves with finer details, why do we see in this Bill a figure of 5% for the stake being taken in these projects? This amendment asks that question. I beg to move.
Lord Teverson
My Lords, I am rather encouraged that there has been some detail from the Government on this point, and I welcome it. However, I want to understand a little better why this particular percentage has been chosen. My noble friend the Minister held an excellent meeting with us to go through the principles of this part of the Bill. I thought that the figure of 5% must be a minimum amount, but it actually means that it cannot be exceeded. Once you work your way around the language in which the Bill is written, you see that it means the exact opposite of what you might have thought; that is, when the regulations are produced, the minimum percentage that a company must offer should be no more than 5%.
Amendment 94AH is a probing amendment and I am not saying that my suggestion is right, but what concerns me is that if we adopt the attitude—which I do—that it is essentially to put a backstop around the hope that the voluntary schemes work, as my noble friend Lord Jenkin has so strongly advocated, in the end we must make sure that if they do not work, there is a way of ensuring that this style of ownership of these projects can move forward. Yet what we have here, or at least as far I can see in theory, is a provision which will allow the regulations to provide that the minimum should be 0% or 1%. It seems to have the potential to undermine a scheme in that companies could offer very small amounts. I have tried to change the provision by suggesting some more sensible language for it. There should be a straightforward minimum of something like 5% and possibly a maximum of 25% in terms of what the Government’s recommendation should be. Again, I say this within the context that if the public do not want to take up the offer, they will not do so and the whole amount will not be taken up, so the percentage would not be so high.
On the other hand, I can see that allowing too high a percentage as a maximum, if it were taken up for certain kinds of renewable scheme, could involve a very large sum of money—well beyond the ability of a community to meet it. I think that this should be written down in a much more positive way so that we do not have something that must not exceed a minimum. We should have a minimum and a maximum. I have explained this incredibly badly and I should have worked it out before I started to speak, but I think that that is illustrative of how this part of the Bill is written. I apologise to the Committee.
It may not be possible for the Minister to respond to my next point in detail, but I shall ask her about it anyway. There are very strict rules indeed covering the ability of companies to sell shares in their organisation to unsophisticated investors. The Financial Conduct Authority has all sorts of rules around it. I would like to understand how the Government see that important financial legislation working in this instance so that it does not become too burdensome for the energy companies to offer such financial investment opportunities and high barriers are not put in place that would prevent members of the community from actually signing up. I am myself a member of a community energy scheme and it is terribly straightforward. I presume that there may be limits on this and I am interested in understanding how we are going to make sure that it will be something of which individual members of a community can take advantage. The regulatory burden should not be too burdensome on renewable energy companies; it should help them not to transgress against the various rules of financial conduct.
Lord Cameron of Dillington
I oppose these amendments. There are dangers involved. I believe in community involvement in local energy schemes whether voluntary or, if need be, statutory, and on the whole this clause is a good proposal. As I said at Second Reading, financial involvement means that the local community does not get in knee-jerk opposition to a scheme, which is good. However, I have chaired or been on the board of several unquoted companies, and I am very much aware of the power that shareholders owning as little as 10% of the equity can have. They would probably rightly be able to claim a place on the board and by judicious use of their block of shares they can have, if so minded, a fairly negative effect on the progress of the company in question. I have experienced an instance of this where a minority shareholder on the board had an agenda different from that of the rest of the board. It is very difficult to drive forward a company under those circumstances. The shareholder can look for opportunities to block and do deals with other shareholders in a negative way.
We are trying to encourage these energy projects to get off the ground and overcome all the obstacles. Those obstacles are not only planners but energy companies, connection problems, landowner problems and certainly community problems. They all have to be focused upon. If the business involved does not remain totally focused on driving the project and overcoming all these obstacles, it can easily falter and the project will get delayed or, worse still, fold altogether. If a group could compulsorily buy in to 10% or, worse still, 20% of a local energy project, that would easily open the door to spoiling tactics by antis, whether they are anti-fracking, anti-wind, anti-PV or just BANANAs —BANANA, as your Lordships will know, stands for “build absolutely nothing anywhere near anything”. In my view, 5% would be a safe upper limit for community involvement, particularly if it is compulsory, 10% would be risky and 20% would be extremely dangerous for our renewable energy industry.
Lord Jenkin of Roding
I promise I am not going to try the patience of the Committee anything like as long as I did a few minutes ago. If one reads the passages in the draft report of the task force, it recommends a number of different methods by which financing could be organised. One is crowdfunding. That might be quite a good way to raise sufficient money to get the community involved. Perhaps it would not be the whole community or the BANANAs that the noble Lord, Lord Cameron, referred to, and we are all very familiar with them, but enough people for them to turn around and say “For heaven’s sake, shut up because we want this to go ahead”.
That report is quite interesting because financial circles see some difficulty of the sort that the noble Lord, Lord Cameron, has been describing, but this is particularly a case where the widest possible flexibility is needed. We want to see community involvement in infrastructure schemes of this sort, but we should not attempt to prescribe how that should happen. The noble Lord, Lord Cameron, clearly indicated that raising the percentage might offer considerable difficulties. It should be entirely free for a local community or investor to decide how it should be done. That can really only be done under a voluntary system.
Lord Teverson
My Lords, perhaps I may respond to the noble Lord, Lord Cameron, who raised some valid points, but they were over individual shareholdings, which is a separate issue, as opposed to a total collective shareholding. Further regulations could be made around maximum individual shareholdings or defining the control of those shareholdings. That is a fairly regular way in which to do this—aggregating some of these things if they are, for example, vexatious. I accept fully that there is a risk of individual shareholder activism but that is a separate issue to the community being able to have a significant or noticeable stake, as opposed to one that is, in smaller schemes, almost token.
Baroness Verma
My Lords, I again thank all noble Lords for their interventions. I should like to respond to the amendments that relate to Schedule 5, in particular the concern over the maximum size of stake that can be mandated through regulations, which is currently set at 5% of the total capital costs of the renewable electricity facility. I tried carefully to follow my noble friend Lord Teverson’s first intervention. I got slightly lost, so I will go back and read it in Hansard tomorrow.
Baroness Verma
If I do not respond to him today, perhaps I may respond after reading Hansard.
I should like to take this opportunity to explain—and I hope address the noble Lord’s concerns—why we have set the 5% cap and why I am resisting the approaches proposed by both amendments. I am also grateful to the noble Lord, Lord Cameron, for his intervention, which—although the noble Lord, Lord Teverson, suggested an alternative—shows the serious possibility for communities, if so minded, to be able to stop a renewable project by trying to obtain a stake bigger than 5%. Let me develop my argument a little further.
The key reason why a 5% cap has been set in the Bill is to provide certainty to developers now on the maximum size of offer that can be legislated for in the future. While the Government wholeheartedly support community investment in renewable electricity and want to see a substantial increase in shared ownership, it cannot be at the expense of investment in renewables. The 5% cap provides absolute clarity to industry on the upper limit on the size of stake it may be required to offer to communities. Although of course we would welcome developers voluntarily offering more, by contrast the approach taken by my noble friend Lord Teverson who proposed a wide range of between 5% and 25% of the total capital costs of development does not provide any meaningful degree of certainty for industry. As such it could risk deterring future investors in the renewables industry. The alternative approach proposed by the noble Baroness, Lady Worthington, similarly does not provide certainty to industry on the maximum size of stake that could be legislated for in the future, since it leaves this to be defined in secondary legislation.
This takes me on to my second point which is about retaining flexibility. I recognise that the key benefit of providing a range, as proposed by my noble friend Lord Teverson, is to retain future flexibility on the maximum size of offer that can be legislated for in the future. However, the approach that we have taken also provides a sufficient degree of flexibility. The 5% cap represents the maximum that could be required, and the actual amount set in secondary legislation could vary by technology. This is important. We need to bear in mind that the scope of the powers covers a greater than 10-fold range in project size. So a 5% mandatory offer to communities might be appropriate for smaller schemes that have a lower capital cost. However, for schemes with a higher capital cost it might be more realistic to set a lower limit, for example at 1% of total project capital costs.
That takes me on to the size of the stake. It is important, when setting the cap on what may be legislated for, that the amount of investment which may be raised by the community is taken into consideration. Based on this, we consider it likely that if a multi-million pound community stake were mandated, there could be insufficient demand for this within the community even if the geographical area were quite large. That is why we have enabled a cap that would allow the offer of a mandatory stake to be set anywhere up to 5%. This approach ensures that the maximum size of stake required can be broadly aligned with the amount of investment that may be raised by the community. By contrast, the approach proposed by my noble friend Lord Teverson implies that a mandatory stake could not be set any lower than 5%. This would mean that developers could be required to offer a larger amount to the community than could plausibly be financed, particularly for larger schemes with a very high capital cost. In addition, raising the threshold to 25% may have a similar effect. Furthermore, under the Companies Act 2006 a level of 25% of shareholder equity ownership has the potential to block a special resolution. The purpose of these provisions is not to mandate that the community has a controlling stake.
That is not to say that we should not encourage developers to offer a stake greater than 5%. I would like to emphasise that this Government would fully support developers choosing to offer more in circumstances where that is appropriate. However, we do not feel that it is right to mandate this size of offer to communities since it could have such fundamental implications for project financing. The position on a 5% cap is supported by RenewableUK, the trade association for wind, which described it as an “ambitious objective”. In respect of setting a higher limit it states that this, “would simply delay a developer’s ability to secure investment from institutional and other investors”.
My noble friend Lord Teverson asked about the rules set by the Financial Conduct Authority. While developers will be required to comply with all Financial Conduct Authority rules as they are set, it would be inappropriate to change or relax those rules as they provide important safeguards for individual investors. Having introduced some clarity in this area, I hope that the noble Baroness will feel able to withdraw her amendment.
Lord Teverson
I thank the Minister for that reply. Again, I apologise for having explained my amendment quite so badly. I accept the point about a special resolution within company law but that would require a block vote and I just do not see that happening. I think that it can be responded to by perhaps having in regulations a maximum individual shareholding. Also, it is not as if this is an IPO. If a certain number of shares are offered, it is not death for the company if they are not all taken up. They can be taken up by other investors, such as perhaps institutional investors. I do not see that as being a problem in this particular case. However, I understand that the numbers I have suggested are not exactly right, and indeed I welcome the fact that we are bringing this forward in any case. I will not press my amendment.
Baroness Worthington
I thank the noble Baroness for her response and all noble Lords who have contributed to the debate. Obviously the schedule to which these amendments apply provides quite a wide range of what a stake equals. It does not always mean that someone is taking shares in a company. It is not always going to be the case of a company owning the individual project. In fact, I am sure that what will be more common is very large companies having to create new instruments for individual projects, which will then enable the community to take part in them. I hope that the fears expressed by the noble Lord, Lord Cameron, would not be an issue of great concern in practice.
I still think that it is quite odd that in such an enabling piece of legislation which is meant to be a backstop for a voluntary approach, we have quite a prescriptive definition of the level of the stake. It is clear from the schedule that many other aspects of what that stake is are completely open and flexible on what might be included, and yet here we have the figure of 5%.
I am always nervous when I see numbers like that in primary legislation and I just hope that there will be sufficient flexibility so that it can be reviewed if necessary.
I do not want to reopen the debate, but the very fact that you need to create comfort and certainty for this class of investors in infrastructure indicates that this is not something that they are embracing with open arms—not because they do not want community involvement but because they fear that the Government’s approach is too limited and inflexible to give them the range of possibilities that they want. However, I am very happy, on the basis of the Minister’s response, to withdraw my amendment.
Baroness Verma
ScheduleThe licensing levyThe amount of the levy 1 Regulations may provide for the licensing levy payable in respect of a charging period to increase or decrease over that period.
Basis of amount2 Regulations may provide for an amount of licensing levy payable by a licence holder to be calculated by reference to the size of an area to which an energy industry licence held by that person relates.
Amounts payable by different categories of licence holders3 Regulations may provide for different categories of licence holders to pay—
(a) different amounts of licensing levy, or(b) amounts of licensing levy calculated, set or determined in different ways.Exemptions4 Regulations may provide for a category of licence holder to be exempt from payment of the licensing levy.
Unpaid levy5 (1) Regulations may provide for interest (at a rate specified in, or determined under, the regulations) to be charged in respect of unpaid amounts of licensing levy.
(2) Regulations may provide for unpaid amounts of licensing levy (together with any interest charged) to be recoverable as a civil debt.
Conferral of functions6 Regulations may confer a function (including a function involving the exercise of a discretion) on—
(a) the Secretary of State, or(b) any other person, apart from the Scottish Ministers or the Welsh Ministers.Categories of licence holders7 (1) Regulations (including regulations of the kinds mentioned in paragraphs 3 and 4) may provide for a category of licence holder to consist of persons who hold a kind of energy industry licence specified in the regulations.
(2) The regulations may (in particular) specify any of the following kinds of energy industry licence—
(a) licences granted under a particular enactment;(b) licences of a particular description granted under a particular enactment;(c) licences, or licences of a particular description (including a description falling within paragraph (a) or (b)), granted—(i) before a particular time,(ii) after a particular time, or(iii) during a particular period.Interpretation8 In this Schedule—
“energy industry licence” means a licence falling within section (Levy on holders of certain energy licences)(1);“licence holder” means a person who holds an energy industry licence (whether the person was granted it or has, after its grant, acquired it by assignment or other means);“regulations” means regulations under section (Levy on holders of certain energy licences)(1).”
Baroness Verma
My Lords, the UK oil and gas industry is of national importance: it makes a substantial contribution to the economy and supports around 450,000 jobs. Oil and gas will continue to play a vital part in the energy mix as we transition to a low-carbon economy and will still meet around 70% of our energy demand in 2030. Therefore, it is vital that we maximise our indigenous supply, to put downward pressure on prices, support jobs and maintain secure supplies.
The Government commissioned Sir Ian Wood in June 2013 to review the regulatory regime for the UKCS because, although investment levels are rising and near-term prospects are strong, there are new challenges for exploration and production, and the environment is very different from when production peaked approximately 15 years ago. Production and exploration levels have fallen, and production efficiency has declined.
Sir Ian’s final report was published in February 2014 and included four recommendations for the Government. His independent report estimates that full and rapid implementation of his recommendations will deliver the equivalent of at least 3 billion to 4 billion barrels of oil more than would otherwise be recovered over the next 20 years, bringing over £200 billion additional value to the UK economy.
The Government have accepted Sir Ian Wood’s recommendations and last week published a formal response setting out their plans for implementation. The government amendments before the Committee are the first vital step in implementing those recommendations and will send a clear signal of the changes required to industry practice and the role of the regulator to deliver the benefits he sets out in his review.
Amendment 95ZA seeks to put the overriding principle contained in Sir Ian Wood’s report into statute, which is maximising the economic recovery of offshore UK petroleum. This is to be achieved, in particular, through the development, construction and deployment of equipment used in the petroleum industry and through collaboration among holders of petroleum licences, operators under petroleum licences, owners of upstream petroleum infrastructure and those planning and carrying out the commissioning of upstream petroleum infrastructure.
The Government and industry should work together to maximise the economic recovery of offshore petroleum from the UK. Because of the continually changing nature of regulation, the developing needs of exploration and production in the North Sea, and changes in technology and approaches, we think that the concept of MER UK is something that itself is likely to change over time. We therefore do not think that setting out the meaning of “maximising economic recovery” in primary legislation is desirable, as greater flexibility is required.
We take the view that this is better achieved through a strategy which can adapt to new challenges and the evolving needs of oil and gas regulation in the North Sea. The clause therefore requires the Secretary of State to produce a strategy for enabling the principal objective to be met and places a duty on the Secretary of State to collaborate with industry and carry out his activities in accordance with the strategy. The clause also places duties on petroleum licence holders, operators, infrastructure owners and associates of those persons to comply with that strategy. There is also a duty on those planning and carrying out the commissioning of that infrastructure. The Secretary of State is under a duty to lay before Parliament a report at the end of each reporting period on the extent to which relevant persons have acted in accordance with the strategy.
The second main provision, set out in Amendments 94B and 95ZB, provides the Secretary of State with the power to raise a levy from industry to help fund the costs of regulating this sector. This is consistent with the user pays principle and the Government’s belief that those who benefit from a service should ultimately pay for it. The power is circumscribed in a number of respects. The total amount of the licensing levy payable cannot exceed the costs of the Secretary of State carrying out his relevant functions. The levy cannot be used to recover costs in respect of areas in which a charge is payable under the Gas and Petroleum (Consents) Charges Regulations 2013 as those regulations stand when this provision comes into force. To ensure the costs are proportionate, the clauses also allow for different amounts to be charged in respect of different licences.
Finally, the levy is subject to a three-year sunset clause, which will mean that the levy arrangements are reviewed over that timeframe to ensure the system put in place is fair, effective and efficient in terms of its administrative burden. As set out in the government response to the Wood review, published last week, the Government have committed to contribute £3 million per year to the running costs of the OGA from 2016-17 for five years. This is to demonstrate the Government’s commitment to the tripartite approach to delivering MER UK and a recognition of the importance to government that the OGA is well funded from the outset. The levy will, of course, be net of this funding received from government.
For the avoidance of doubt, noble Lords should note that in due course the Government intend to set up the regulator as an arm’s-length body in the form of a government company. However, in the interim, the body will be established as an executive agency. Therefore, for the present, the legislation refers to the Secretary of State.
The other government amendments in this grouping, Amendments 95ZC, 96ZB, 97A and 98AA, are technical in nature and I do not propose to spend too long on them. Suffice to say that these clauses deal with consequential provision, the parliamentary procedure in relation to regulations, territorial extent and commencement. Amendment 95ZC amends the scope of the power in Clause 28 so that it applies also to the clauses dealing with maximising the economic recovery of UK petroleum, the levy on holders of certain energy licences and the relevant schedule. Amendment 96ZB amends Clause 29 so that if we amend the reference to the Gas and Petroleum (Consents) Charges Regulations 2013 as set out in the primary legislation, we would have to use the affirmative procedure. Amendment 97A is required because the Wood review amendments are to have GB extent. It also contains an amendment in relation to the extent of the Extractive Industries Transparency Initiative. Amendment 98AA relates to commencement in respect of the Wood review provisions and the Extractive Industries Transparency Initiative.
The Government have worked at a furious pace to bring forward the measures for this Bill. However, in doing so, we have not yet been able to publish the regulatory impact assessment which normally, although unfortunately not always, would accompany the introduction of the relevant provisions. It is our firm intention to publish our assessment of the indicative range of potential costs and benefits of these powers prior to Report.
I hope it will comfort noble Lords that the industry is supportive of Sir Ian’s recommendations and has called on the Government to implement them timeously. The policy intent is to reduce regulatory burden, empower a stronger, more capable regulator that can mobilise and catalyse, and enhance the efficiency and co-ordination of activity in the UK continental shelf. The clauses we have put forward in the Bill are a key part of what is required to implement the recommendations. I beg to move.
Lord Jenkin of Roding
My Lords, I give an unreserved welcome to these new provisions. When Sir Ian Wood’s report was published last February, and the industry had had time to absorb its messages, there was almost universal support for his recommendations. I think my noble friend said that the Government have worked at a furious pace, and I recognise that. However, I wish to make two points. First, I am surprised to be told by the industry’s representative body that it was not consulted on the terms of these government amendments. It states that the industry,
“has not been consulted about the nature and format of these MER UK amendments”.
I stress as strongly as I can that in the next stages of carrying this forward—working out the strategy, dealing with the details and all the other matters which will flow from this—the Government simply must regularly consult the industry; otherwise, the good will that has been attracted by the evident swiftness in accepting a very complex and detailed report will evaporate if there is a feeling that somehow the Government are charging ahead and not taking account of what the industry wishes to say. I am sure that my noble friend will give me a very firm commitment that the Government will consult the industry on any further steps.
My other point is based to some extent on my experience as a long-standing member of various voluntary bodies and other organisations. Some years ago, I chaired an Anglo-Norwegian seminar for the Foundation for Science and Technology. The seminar was held at what was then the Institution of Electrical Engineers and was attended by the King of Norway, the Duke of Edinburgh, the managing director of BP—my noble friend Lord Browne of Madingley—and the chief executive of Statoil. A very high-level discussion took place between the British and the Norwegians on not just the North Sea but, of course, the Barents Sea. It was a fascinating morning and I certainly learnt a great deal. I chaired much of the meeting and the noble Lord, Lord Broers, chaired another part. At one point, one of my honourable friends from the other House asked the two chief executives—my noble friend Lord Browne and the Statoil CEO—what their highest priority was. The answer was, “fiscal and regulatory stability”. They make long-term investments and changes in the tax system or the regulatory system do enormous damage in undermining willingness to invest.
That event was followed, a week later, by the then Chancellor of the Exchequer, the right honourable Gordon Brown, imposing a substantial additional tax on the industry in the North Sea, which caused huge dismay. Other Governments have done the same in the past, so it was not unique, but it was a remarkable example. Having been told that the highest priority was stability, the Government made a significant change on that sort of thing, with no notice. It really was a very astonishing response.
Baroness Worthington
My Lords, I thank the noble Baroness for her introduction to the government amendments before us. I shall speak to Amendment 95ZAA tabled in my name and the other amendments grouped with it. The Wood review was a very interesting document. I think that the noble Lord, Lord Jenkin, has alluded to the fact that we are now in the endgame of a 40-year period during which we have been very blessed with an industry that has been able to deliver in a safe and secure way the volumes of oil and gas that have powered our industries and made our way of living possible. It has underpinned everything we do. However, let us be in no doubt that we are coming to the end of that golden era and obviously a lot needs to be decided about what to do next.
We have the Wood review, which is a great report and to be massively commended for having only four recommendations; that is always easy to get your head around. However, the executive summary tells us the story. We have had the equivalent of 42 billion barrels of oil from the North Sea. There are now possibly only another 12 to 24 billion barrels of oil equivalent left. It is clearly a depleting resource. It is common knowledge that it peaked 15 years ago. As a result, we now see our economy being affected. Our ability to raise tax has been severely impacted by this and it has changed the revenues that we see. In fact, the Wood review makes clear that in 2013 the steep decline in productivity of this resource led to £6 billion less in tax receipts. That is not a small amount of money to try to make up. I can see perfectly why there would be a desire to extract the last barrel in order to get every drop out. This is a problem which faces us all as a community. As UK plc, it has been such a big part of our tax receipts over the past 30 to 40 years.
In the context of the Infrastructure Bill, does the implementation of the Wood review’s recommendations give us a strategic direction? Does it show that the Government understand the nature of the problem and are preparing us for the future? I would argue: not yet. There is clearly a need to implement these findings. I should state that being able to provide our own oil and gas as opposed to importing it from far-flung places is obviously of benefit in terms of security of supply, broader geopolitical stability and carbon emissions. Carbon emissions have been well regulated. Indigenous production of the fossil fuels that we still need to use will emit lower levels of carbon than importing over long distances from different parts of the world where the regulations are not governed by us and we cannot be certain of the carbon footprint.
None of that is to say that we should not do this, but because of where we are today, we need to think of the future of the continental shelf and what it will deliver for us in the next 40 years. It is quite clear that if we are to benefit from a new industry, it will be carbon capture and storage. In fact, it is mentioned in the Wood review. The purpose of tabling Amendment 95ZAA is simply to put in the Bill the recognition that we are in transition and moving to a new era where no matter how much we skirt around it, the oil and gas are running out. That problem is not explicitly stated or put front and centre of the Wood review, for probably good reasons. However, the issue is not that it is a fractured and small industry with 300 wells and a number of different companies. It is just that the resource is dwindling. We can make ourselves more efficient and increase the rate of extraction, but it will not be around for ever.
It is important that the Government of the day should realise that we need to start investing now in what will be the future industry. Carbon capture and storage provides us with a potential source of revenue and a very important tool in the armoury of the low-carbon economy. We know the Government are committed to that, but we would like to see more emphasis being placed on it. In government, we certainly would put that emphasis on it because it is fundamental to our industrial strategy for the UK. There are many ways to produce low-carbon electricity, such as nuclear or renewables. There are not that many way to produce steel, chemicals or cement if you exclude carbon capture and storage. It offers the potential to enable us to fully decarbonise our economy without at the same time de-industrialising and losing those heavy industries to other parts of the world. The key to that is ensuring that we have the infrastructure in place that enables us to build carbon capture and storage technology. I have tabled Amendment 95ZAA merely to raise the issue and ensure that government thinking is in line with this analysis and that there is a recognition that carbon capture, transportation and storage will be a big part of our infrastructure going forward.
The other two amendments are very much probing in nature and relate to the broader question of whether maximising economic recovery is compatible with our climate change commitments. As I said at the start, I am absolutely clear that there are carbon benefits to indigenous supply, and this is not intended to go against that. However, it is also of concern to people that we often hear rhetoric such as, “Well, if we don’t develop it, we’ll be buying it from somewhere else and that will be a negative thing”. That is only true in so far as the carbon footprint of extracting the asset is lower than if it comes from overseas or other sources. There is nothing inherently lower carbon about extracting the last drop of oil from the North Sea. It may well be the case at the moment, but it might not be in the future. We want to make sure that we are not ignorant of the fact that we are going to have to shift to a low-carbon economy and that there will come a point where oil and gas have to be left in the ground.
We know from the Intergovernmental Panel on Climate Change that we have roughly a 3 trillion tonne international or global carbon budget and that around half of that has already been emitted. At the rate we are going, the remaining half of the budget will be fully emitted before 2040, which is not that far away—and that is to have a safe chance of staying within a 2-degree increase in terms of global warming. At some point the oil and gas industry will have either to commit to full carbon capture and storage of all its emissions or accept that a large proportion of the oil and gas will have to stay in the ground. The reason for tabling these amendments, which as I say are very much probing amendments, is to elicit some comments from the Minister about the longer-term vision and whether we accept and acknowledge that there will come a point when our global carbon budget is exceeded and we need to do things very differently.
Amendment 95ZAC is designed to try to tease out some of the recommendations of the Wood review in a bit more detail. We understand that this is enabling legislation but we felt that it would be good to be provided with a little more detail and some assurances that the Wood review’s recommendations will be introduced.
The last amendment in my name in this group is Amendment 95ZBA, which relates to an aspect of these clauses that the noble Baroness has touched on; namely, the payment of the new regulator. We fully support the idea that this should be an arm’s-length regulator in due course and that it should be funded from receipts from industry. We have tabled this amendment simply to require the Secretary of State to report on when the regulatory body will be fully funded by that levy.
These amendments explore an area which is now the subject of a very important debate. As I have said, we have had 40 years of access to an amazing resource that has led to countless millions and billions of pounds being ploughed into our economy, many thousands of jobs being created and various successful industries being born off the back of it. Those days, I fear, are drawing to a close. There are new ways we can use the continental shelf and what it offers us, and there is infrastructure there which can be reused. Let us be under no illusion: the Wood review was needed because we are in a process of change, and I am sure there will be more changes in the future. I would like to see the Infrastructure Bill, before it leaves this House, fully acknowledge that we are in this transition and put an emphasis on new technologies, new uses of our assets, and the new infrastructure that we will need.
Lord Whitty
My Lords, I want to make just a few remarks on this. I do not quite share my noble friend’s rosy picture of the effect of the oil and gas industry on the British economy. Although benefits were derived from the period during which Britain was an oil producer, it distorted the rest of the economy. That need not necessarily have been the case, had we had a plan to use the proceeds from North Sea gas and oil in a way which developed the rest of the economy. Instead, large sections of the manufacturing sector disappeared. We did not have a clear strategic plan for the totality of the economy although there was a fairly clear strategic plan as regards the exploitation of North Sea gas and oil itself.
I do not wish to prolong that situation during the decline of North Sea gas and oil. We now need to plan for the transition. That is, in a sense, what the Wood report is saying. The mechanism for doing that is in part reflected in these government amendments. They are, however, slightly odd amendments because they effectively propose the basis for a new regulator. As that regulator is not yet in being, reference is made to the Secretary of State. Presumably, the Minister will be able to confirm that at some point down the line we will have new primary legislation which sets up the structure, governance, powers and responsibilities of the new regulator, in which case some of these measures will have to be rewritten not very far down the line. I am not necessarily against that but it means that how the measure is written in relation to the Secretary of State will be different when we have a fully fledged regulator. There will be different parliamentary oversight apart from anything else.
My next point follows that made by my noble friend on carbon capture and storage. It is important to recognise that the continuing use of fossil-based fuels will not be compatible with our carbon targets unless there is some form of carbon capture and storage. Moreover, the North Sea has bequeathed us a significant natural facility for storing that carbon. The whole issue of enhanced oil recovery and the use of that storage for carbon dioxide storage in the future is vital. Indeed, in the whole of Europe, and possibly the world, there is no more obvious place where we could store the carbon produced through the continuing use of fossil fuels, with, I suspect, relatively little local opposition.
When the noble Lord, Lord Cameron, and I were involved in the Select Committee report on European energy, we found that Germany and other central European countries were very opposed to carbon capture and storage taking place among their population and on their territory. However, in Britain we have a real opportunity to offer the totality of the European energy and industrial network the use of those North Sea facilities, which would last a long time. I once asked someone to put a timescale on that but it will certainly see us out and will probably be longer than the period during which we have extracted North Sea oil and gas. It is therefore important that the carbon capture and storage element is written into the strategy and the legislation paving the way to set up a new regulator, as my noble friend’s amendment would do. Therefore, I hope that the Government will accept it.
My last point is tangential and requires the Minister to talk to her colleague, the noble Baroness, Lady Kramer. Amendment 94B and the subsequent amendments seek to establish the provisions of a licence. Some noble Lords may remember that when we started to discuss this Bill a few weeks ago, we talked about a licence for a new highways company. The noble Baroness, Lady Kramer, said that that would all be dealt with in the licence. However, in relation to energy, primary legislation is required to set down what the licence will cover. I think that we need a reply from the Department for Transport at some point as to why we do not need the equivalent in relation to the corporatisation of the Highways Agency into a body that will itself require a licence. The questions that I and others have raised on the nature of this new body have been brushed off by it being said that it will all be in the licence. When we come back to the front end of this Bill, I may start asking those questions again. I do not expect the Minister to answer that now, but perhaps she or her officials could convey that to their opposite numbers in the Department for Transport.
Lord Jenkin of Roding
I shall make a few observations on the speeches that we have heard from the noble Baroness, Lady Worthington, and the noble Lord, Lord Whitty. The Government are pursuing carbon capture and storage. They have put up £1 billion, which will probably not be necessary, and have identified projects that will be supported, one of which is the project at Peterhead, which will use the storage available in the offshore oil field. That is exactly right. I have asked questions in the past about the perfectly good saline caps onshore and why they could not similarly be used; they have exactly the same provision to be able to keep material indefinitely over millennia. Some of them are now being used for gas storage. I was pleased to hear today that there has been quite a significant increase in gas storage in recent years—something for which I and others have been arguing. It is entirely right, as the Secretary of State said in his Written Statement that,
“the principles will apply to offshore activity, however Government intend that the OGA’s remit should extend to onshore—as well as to the licensing activity for natural gas storage and unloading and carbon dioxide storage—and so, working with the respective industry stakeholders and trade groups, we will look to extend the principles accordingly”.—[Official Report, Commons, 16/7/14; col. 74WS.]
I am sure that that is right, but it prompts the question of whether these principles apply to the extraction of natural gas from shale. Different conditions may need to apply. Noble Lords have already referred to the idea of progressively replacing inevitably declining oil and gas resources with the apparently huge availability of shale gas in this country. I do not want to anticipate the debates that we will have in the autumn after the consultation on access to shale gas. However, the fact of the matter is that there are very large quantities indeed. It is interesting that the Bowland shale basin, which has been surveyed quite substantially by the British Geological Survey, is many hundreds of feet in thickness, quite apart from being two kilometres down, or whatever it is. Much of what was being extracted in America has been from comparatively slender deposits of shale. In that respect, we are sitting on a huge potential resource, which will need to be very carefully managed from all sorts of angles—environmental, and everything else. What we hope that OGA will do for the offshore oil and gas industry is to gain knowledge that will be applicable to these onshore developments, to which the Secretary of State referred in column 68 of his Written Statement. Of course he also said:
“Government will work closely with industry and other interested parties in the months ahead to undertake this work and ensure we are ready to put legislation on the additional powers before the House in the first Session of the new Parliament”.—[Official Report, Commons 16/7/14; col. 75WS.]
That is keeping up with the tradition of having a new Energy Bill every Session.
This is so important, and one has to get this right. Perhaps with the addition of the amendments that the Government have tabled, this is a very important step forward. One has to recognise that this is not inevitable; it has to be very carefully managed, and with the co-operation of the industry, government and eventually the OGA, which is a key player in this, there is no reason why it should not be achieved. I look forward to this with considerable optimism. It is a very good and attractive part of the Bill, and I hope that we accept the Government’s amendments.
Baroness Verma
My Lords, again we have had some excellent contributions. I do not agree with the amendments which have been tabled by the noble Baroness and I will respond to them in due course, but I thought it would be helpful to respond first to the questions posed by my noble friend Lord Jenkin. He said that the industry feels that it has not been consulted on the government amendments. I hope that I can reassure him that the Wood review itself was the subject of nine months’-worth of detailed consultation with the industry and interested stakeholders, which welcomed the recommendations and called on the Government to implement them rapidly. However, we plan to consult further on the additional regulatory powers that the body will have and on matters such as how to apply MER UK to the onshore industry and the cost recovery mechanism to pay for the new oil and gas authority. We will therefore continue to consult industry, and I hope that my noble friend can take that back, saying that industry representatives will be very much part of the discussion.
My noble friend also touched on the issue of taxation. Clearly any sensible approach to maximising economic recovery for oil and gas needs consistency between the regulatory and fiscal regimes. This was a central recommendation made by the Wood review. The Treasury, the industry and the oil and gas regulator should commit to a tripartite strategy to deliver MER UK. In Budget 2014, the Chancellor announced that the Government would conduct a review of the fiscal regime and on 14 July the Treasury launched that review. We will publish interim conclusions with the Autumn Statement. He also mentioned that the scope of the body should include onshore projects such as shale. Although the Wood review focused on actions to maximise economic recovery from the UK continental shelf offshore, Sir Ian did note that there was a strong rationale for extending the remit to the recovery of oil and gas onshore—for example, to shale. I hope that that satisfies my noble friend.
The noble Lord, Lord Whitty, asked about the second phase. It is likely that additional legislation will be required to implement the regulatory powers that were recommended by the Wood review for setting-up the new arm’s-length body. Primary legislation will be brought forward as necessary.
I turn to the amendments tabled by the noble Baroness, Lady Worthington. Amendment 95ZAA would extend the maximising economic recovery principle objective into the important area of enhanced oil recovery. It would also extend the principle of maximum economic recovery to carbon dioxide transport and storage. These are clearly important technologies that must be developed and deployed appropriately, and which will require a significant degree of co-ordination and collaboration between industry, government and the regulator. The EOR is a technique for increasing production from oil and gas reserves. As such, its exploration, development and co-ordination is intrinsic to maximising economic recovery and there is no need for specific provision on the face of the Bill.
The Wood review called for government, industry and the regulator to develop six sector strategies to underpin the delivery of the MER UK strategy. These include a technology strategy that would set out the key areas for progress and development of key technologies such as enhanced oil recovery to maximise economic recovery. The Government believe that the framework we propose is the best suitable means for doing so.
Baroness Verma
“The Extractive Industries Transparency Initiative
After section 8 of the Commissioners for Revenue and Customs Act 2005 insert—“8A The Extractive Industries Transparency Initiative
(1) The Commissioners may do anything which they think necessary or expedient in connection with the Extractive Industries Transparency Initiative in so far as it relates to taxes the collection and management of which is the responsibility of the Commissioners.
(2) In this section “the Extractive Industries Transparency Initiative” means the international initiative of that name which has the aim of promoting openness in the management of revenues from natural resources.””
Baroness Verma
My Lords, Amendment 95 will give HMRC a new function, allowing it to participate in the Extractive Industries Transparency Initiative, which I will now refer to as “EITI”. On 22 May 2013, the Prime Minister announced that the UK will sign up to EITI. This was a key announcement under the UK’s G8 presidency. EITI provides an assurance that companies will publish what they pay for extracting natural resources and that Governments will disclose the money that they receive from this. By joining EITI and encouraging other countries to join the UK will play its part to improve the way revenues from oil, gas and minerals are managed and to make sure that people across the world share in the economic benefits of the natural resources of the countries in which they live. The amendment will ensure that HMRC will be able to participate in this important initiative and is the minimum legislation required to meet the UK’s public commitment to EITI. I beg to move.
Baroness Whitaker (Lab)
My Lords, I must confess that I am rather puzzled by this amendment, as indeed I was by the Prime Minister’s announcement more than a year ago that he and Mr Hollande would both sign up to EITI. EITI was, of course, an initiative by the previous Government with the very commendable aim of ensuring, as the noble Baroness said, that oil industry companies are obliged to disclose their financial transactions and treasuries are obliged to disclose the revenue. It was very commendable because it was initiated for countries where the oil industry was extremely corrupt and made clandestine payments to the Government in exchange for concessions and where taxpayers—if indeed they paid much tax at all as they were too poor—had absolutely no sight of these financial transactions. Now, even the most extreme critic of British capitalism would not, I think, say that anything like that regime obtains here so I am curious as to why we need to sign up to this system, which was entirely meant for developing countries where their resources have proved inimical rather than helpful to their development. It is also my understanding that the revenue obtained from oil companies is easily available from the Treasury in any case, so why this amendment?
Lord McKenzie of Luton (Lab)
My Lords, I put one small question to the Minister. We discussed in the previous amendment a new levy that will be introduced as a consequence of the Bill. Is it envisaged that that levy would be includable in EITI reports and, if so, is it a tax for the purposes of the proposed new Section 8A of the Commissioners for Revenue and Customs Act 2005?
Baroness Verma
My Lords, I am very grateful to noble Lords for their intervention. I shall respond to the noble Baroness, Lady Whitaker, first. We are transparent, but we want to show clear leadership and be part of the growing group of countries signing up to the EITI, which sends a very clear message across the industry globally that we need to have transparency in the oil, gas and mineral sector. By being part of the growing group, we are indicating that UK companies based overseas are committed to the transparency that we expect on our shores here. I do not think that there is any other purpose than to be able to show clear leadership and that it is the right thing to do. We have always tried to be transparent but, as the noble Baroness said, there are countries that need nudges. Perhaps by showing leadership and being part of an ever-extending group of countries wishing to sign up to the EITI, we can show globally that this is a direction that countries that want to show transparency are taking.
I may need to write to the noble Lord, Lord McKenzie, with a more detailed response on his point.
Baroness Verma
“Maximising economic recovery of UK petroleum
After section 9 of the Petroleum Act 1998 insert—“Part 1AMaximising economic recovery of UK petroleum9A The principal objective and the strategy
(1) In this Part the “principal objective” is the objective of maximising the economic recovery of UK petroleum, in particular through—
(a) development, construction, deployment and use of equipment used in the petroleum industry (including upstream petroleum infrastructure), and(b) collaboration among the following persons—(i) holders of petroleum licences;(ii) operators under petroleum licences;(iii) owners of upstream petroleum infrastructure;(iv) persons planning and carrying out the commissioning of upstream petroleum infrastructure.(2) The Secretary of State must produce one or more strategies for enabling the principal objective to be met.
(3) A strategy may relate to matters other than those mentioned in subsection (1)(a) and (b).
(4) A strategy may not impose an obligation which relates to the powers of a person to make commercial arrangements unless—
(a) the strategy imposes the obligation on relevant participants in the petroleum industry, and(b) the Secretary of State considers that the obligation will—(i) stop commercial arrangements made by those relevant participants, or associates of those relevant participants, from having a significant adverse effect on the principal objective, or(ii) reduce the extent to which such arrangements have such an effect.(5) In this section—
“associate” has the meaning given in section 91 of the Energy Act 2011;
“relevant participant in the petroleum industry” means—
(a) the holder of a petroleum licence,(b) an operator under a petroleum licence, or(c) an owner of upstream petroleum infrastructure.(6) For provision about producing and revising a strategy, see sections 9F and 9G.
9B Exercise of certain functions of the Secretary of State
The Secretary of State must act in accordance with the current strategy or strategies when—(a) exercising functions under the other Parts of this Act (except Part 4),(b) exercising functions under Part 4 to the extent that they concern reduction of the costs of abandonment of offshore installations and submarine pipelines,(c) exercising functions under Chapter 3 of Part 2 of the Energy Act 2011 (upstream petroleum infrastructure),(d) exercising any function or using any power under a petroleum licence, and(e) exercising any other function or using any power—for the purpose of enabling the principal objective to be met.(i) to provide advice or assistance to another person, or(ii) to acquire, use or supply information,for the purpose of enabling the principal objective to be met.9C Carrying out of certain petroleum industry activities
(1) A person who is the holder of a petroleum licence must act in accordance with the current strategy or strategies when—
(a) planning and carrying out activities as the licence holder, and(b) making commercial arrangements which relate to the person’s activities as the licence holder (in so far as this does not fall within paragraph (a)). (2) A person who is an operator under a petroleum licence must act in accordance with the current strategy or strategies when—
(a) planning and carrying out activities as the operator under the licence, and(b) making commercial arrangements which relate to the person’s activities as the operator under the licence (in so far as this does not fall within paragraph (a)).(3) A person who is the owner of upstream petroleum infrastructure must act in accordance with the current strategy or strategies when—
(a) planning and carrying out the person’s activities as the owner of upstream petroleum infrastructure (including the development, construction, deployment and use of the infrastructure), and(b) making commercial arrangements which relate to the person’s activities as the owner of upstream petroleum infrastructure (in so far as this does not fall within paragraph (a)).(4) A person must act in accordance with the current strategy or strategies when planning and carrying out the commissioning of upstream petroleum infrastructure.
9D Reports by the Secretary of State
(1) As soon as practicable after the end of each reporting period, the Secretary of State must—
(a) consider the extent to which, during that period, these persons have followed section 9C by acting in accordance with the current strategy or strategies—(i) licence holders,(ii) operators under petroleum licences,(iii) owners of upstream petroleum infrastructure, and(iv) persons planning and carrying out the commissioning of upstream petroleum infrastructure; and(b) produce a report on the results of the consideration of that question.(2) The report may contain other material, including a statement of action which the Secretary of State has taken, or is proposing to take, in response to any matter included in the report (including changes to a strategy).
(3) The Secretary of State must publish, and lay before each House of Parliament, a copy of each report produced under this section.
(4) In this section “reporting period” means—
(a) the period of two years beginning with the day when this section comes into force, and(b) each subsequent period of one year beginning with the day after the end of a previous reporting period.9E Secretary of State’s security and resilience functions
(1) This Part does not limit the exercise of the Secretary of State’s security and resilience functions.
(2) This Part is subject to the exercise of the security and resilience functions by the Secretary of State.
(3) In this section “security and resilience function” means any function which relates to—
(a) the security of petroleum supplies, or(b) the resilience of the petroleum industry.9F Producing and revising a strategy
(1) The Secretary of State must produce the first strategy before the end of the period of one year beginning with the day on which this section comes into force.
(2) The Secretary of State may subsequently—
(a) produce a new strategy, or(b) revise a current strategy,whenever the Secretary of State thinks appropriate. (3) The Secretary of State must review each current strategy before the end of each relevant four year period.
(4) In reviewing a current strategy, the Secretary of State must (in particular) take account of the results of any consideration undertaken under section 9D in respect of reporting periods falling within the relevant four year period.
(5) In this section “relevant four year period”, in relation to a current strategy, means a period of four years beginning with—
(a) the date on which the strategy was issued, or(b) if later, the date on which the last review under subsection (3) was concluded.9G Procedure for producing and revising a strategy
(1) Before—
(a) producing the first strategy,(b) producing a new strategy, or(c) revising a current strategy,the Secretary of State must prepare a draft of the strategy or revised strategy.(2) The Secretary of State must—
(a) consult such persons as the Secretary of State thinks appropriate about the draft, and(b) consider any representations made by them.(3) If, after complying with that duty, the Secretary of State decides to proceed with the draft (in its original form or with modifications), the Secretary of State must lay a copy of the draft before each House of Parliament.
(4) The Secretary of State may not take any further steps in relation to the draft if, within the 40 day period, either House resolves not to approve the draft (a “negative resolution”).
(5) If neither House passes a negative resolution, the Secretary of State may issue the strategy or revised strategy in the form laid before Parliament.
(6) The strategy or revised strategy comes into force on the date specified by the Secretary of State (which must not be before the date when it is issued).
(7) Subsection (4) does not prevent a new draft of a strategy or revised strategy from being laid before Parliament.
(8) In this section “40 day period”, in relation to the draft of a strategy or revised strategy, means the period of 40 days beginning with the day on which the draft is laid before Parliament (or if the draft is not laid before each House on the same day, the later of the 2 days on which it is laid).
(9) For the purposes of calculating the 40 day period, no account is to be taken of any period during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than four days.
9H “Upstream petroleum infrastructure” and its owners
(1) In this Part “upstream petroleum infrastructure” means—
(a) a gas processing facility,(b) an oil processing facility, or(c) an upstream petroleum pipeline,if and in so far as it meets conditions A and B.(2) A facility or pipeline meets condition A if and in so far as it is situated in Great Britain or relevant UK waters.
(3) A facility or pipeline meets condition B if and in so far as it is used in relation to UK petroleum (including such petroleum after it has been got).
(4) But an upstream petroleum pipeline is not “upstream petroleum infrastructure” if it is a pipeline to which section 17GA applies (petroleum pipelines subject to Norwegian access system).
(5) In this section, the following expressions have the same meanings as in Chapter 3 of Part 2 of the Energy Act 2011 (see section 90 of that Act)—
(a) “gas processing facility”; (b) “oil processing facility”;(c) “upstream petroleum pipeline”.(6) In this Part, “owner”, in relation to upstream petroleum infrastructure, means—
(a) a person in whom the pipeline or facility is vested;(b) a lessee and any person occupying or controlling the pipeline or facility; and(c) a person who has the right to have things conveyed by the pipeline or processed by the facility.9I Other interpretation
In this Part—“current strategy”, in relation to any particular time, means a strategy under section 9A(2) in force at that time;
“operator under a petroleum licence” means a person who is responsible for organising or supervising any of the operations of searching for, boring for, or getting UK petroleum in pursuance of the petroleum licence;
“owner”, in relation to upstream petroleum infrastructure, has the meaning given in section 9H;
“petroleum” has meaning given in section 1;
“petroleum licence” means a licence granted under—
(a) section 3 of this Act, or(b) section 2 of the Petroleum (Production) Act 1934;“principal objective” has the meaning given in section 9A;
“relevant UK waters” means—
(a) the territorial sea adjacent to the United Kingdom, and(b) the sea in any area designated under section 1(7) of the Continental Shelf Act 1964;“UK petroleum” means petroleum which for the time being exists in its natural condition in strata beneath relevant UK waters;
“upstream petroleum infrastructure” has the meaning given in section 9H.””
Baroness Verma
“Levy on holders of certain energy industry licences
(1) The Secretary of State may, by regulations, provide for a levy to be imposed on, and be payable by, one or more of the following kinds of persons—
(a) persons who hold licences under section 2 of the Petroleum (Production) Act 1934 or licences under section 3 of the Petroleum Act 1998 (exploitation of petroleum);(b) persons who hold licences under section 4 of the Energy Act 2008 (unloading and storing gas);(c) persons who hold licences under section 18 of the Energy Act 2008 granted by the Secretary of State (storage of carbon dioxide).(2) No licensing levy is to be imposed in respect of a time which falls after the end of the period of 3 years beginning with the first day of the first charging period.
(3) The Secretary of State must exercise the power conferred by subsection (1) so as to secure—
(a) that the total amount of licensing levy which is payable in respect of a charging period does not exceed the costs incurred by the Secretary of State in exercising the relevant functions in respect of that period; and (b) that no levy is payable in respect of costs incurred in any exercise of relevant functions for which a charge is payable under the Gas and Petroleum (Consents) Charges Regulations 2013 (as those Regulations stand when this section comes into force).(4) In determining for the purposes of subsection (3)(a) the total amount of licensing levy payable in respect of a charging period, an amount of levy payable in respect of that period may be ignored if (during that period or subsequently)—
(a) having been paid, it is repaid or credit for it is given against other licensing levy that is payable; or(b) having not been paid, the requirement to pay it is cancelled.(5) The “relevant functions” referred to in subsection (3) are—
(a) functions under the following enactments—(i) the Pipe-lines Act 1962 (cross-country pipe-lines);(ii) section 3 and the other provisions of Part 1 of the Petroleum Act 1998 (exploitation of petroleum);(iii) Part 1A of the Petroleum Act 1998 (maximising economic recovery of UK petroleum);(iv) Part 3 of the Petroleum Act 1998 (submarine pipelines);(v) Part 4 of the Petroleum Act 1998, in so far as the functions concern reduction of the costs of abandonment of offshore installations and submarine pipelines;(vi) section 4 and the other provisions of Chapter 2 of Part 1 of the Energy Act 2008 (importation and storage of combustible gas);(vii) section 18 and the other provisions of Chapter 3 of Part 1 of the Energy Act 2008 (storage of carbon dioxide);(viii) Chapter 3 of Part 2 of the Energy Act 2011 (upstream petroleum infrastructure);(b) carrying out policy work on matters relating to UK petroleum and its recovery;(c) providing advice and assistance to the petroleum industry on matters relating to UK petroleum and its recovery;(d) collaborating with the petroleum industry on matters relating to UK petroleum and its recovery;(e) acquiring, using and supplying information on matters relating to UK petroleum and its recovery;(f) encouraging development of the petroleum industry in relation to the recovery of UK petroleum;(g) carrying out, or providing advice and assistance to those carrying out, research and development in relation to technology and products relevant to the recovery of UK petroleum;(h) functions which relate to— (i) the security of petroleum supplies, or(ii) the resilience of the petroleum industry;(i) international co-operation on matters relating to UK petroleum and its recovery, including—(i) resolution of disputes relating to the entitlements of different countries in relation to petroleum fields, and(ii) openness and accountability in the management of natural resources.(6) The matters relating to UK petroleum and its recovery which fall within paragraphs (b), (c), (d) and (e) of subsection (5) include—
(a) maximising the economic recovery of UK petroleum, and(b) improving the supply chain of UK petroleum. (7) The amount or amounts of licensing levy payable by licence holders must be—
(a) set out in the regulations, or(b) calculated in accordance with a method set out in the regulations.(8) The licensing levy is payable to the Secretary of State.
(9) Schedule (The licensing levy) (the licensing levy) has effect.
(10) Schedule (The licensing levy) does not limit the provision that may be made by regulations under this section.
(11) The Secretary of State may, by regulations, amend subsection (3)(b) by adding, removing or amending a reference to any regulations made under section 188 of the Energy Act 2004.
(12) In this section and Schedule (The licensing levy)—
“charging period” means a period in respect of which licensing levy is payable;
“licensing levy” means the levy provided for in regulations under this section;
“UK petroleum” means petroleum (within the meaning given in section 1 of the Petroleum Act 1998) which for the time being exists in its natural condition in strata beneath—
(a) the territorial sea adjacent to the United Kingdom, and(b) the sea in any area designated under section 1(7) of the Continental Shelf Act 1964.”
Baroness Eaton
“Renewable heat incentives
(1) Section 100 of the Energy Act 2008 is amended as follows—
(a) in subsection (2)(a)(i), after “operate the plant” insert “, or any person nominated by the owner”;(b) in subsection (2), for “the Secretary of State or the Authority” substitute “the Administrator” where it appears in paragraphs (a), (d), (e), (h) and (i);(c) in subsection (2), after paragraph (i) insert—“(j) make provision about appeals.”;(d) in subsection (3), before the definition of Authority, insert—““the Administrator” means—
(a) the Secretary of State;(b) the Authority; or(c) if the regulations so provide, a specified person other than the Secretary of State or the Authority;”;(2) Omit section 105(2)(a)(vi) of the Energy Act 2008.”
Baroness Eaton (Con)
My Lords, efficiency has been mentioned rather a lot during the proceedings in this Committee today, and I propose a brief amendment that would improve efficiency and increase the opportunity for all to benefit from the government scheme to introduce renewable heat, which will improve the UK’s most important infrastructure—mentioned earlier by the noble Lord, Lord Whitty—our buildings.
The legislation set out in the Energy Act 2008 does not allow for the assignment of renewable heating incentive payments to a third party as is permitted for feed-in tariffs. Indeed, under current powers, only the owner of the renewable heating system can receive payments for the scheme. The result is that while those with access to finance can benefit from the government scheme, those without such access will not be so fortunate. Many of them are hard-working rural families who, by living off the gas grid, have higher energy bills and a greater tendency to be fuel poor. My amendment would give the Government options on how to open the scheme most efficiently and effectively to wider funding. It would allow the renewable heat incentive to replicate the successes that have been seen with the Solar PV that has been installed so widely.
Baroness Worthington
My Lords, I am grateful to the noble Baroness for describing her amendment and will comment briefly on the group. Starting with the last point about making administrative changes to the way the RHI works through the negative process, I do not think that is necessary—we are not there yet and I would not support it. One of the benefits we have had over the last year or two as we have been talking about the RHI is that we have had regular opportunities to discuss the issue. It is definitely not the case that everything is hunky-dory and that we can just forget about it and let it all roll on. There are still some quite important issues, and we will need to return to them and have parliamentary scrutiny over them.
Having said that, it is also true that there are some issues with the RHI that we need to see streamlined. I do not wish to sustain a bureaucratic and complex jungle of regulations, but this is a complex piece of legislation and removing parliamentary scrutiny is not going to resolve that. It is fundamentally about improving the policy over time as we become more comfortable with what the RHI is delivering. The other reason for not supporting that element of the amendment is that, unlike the RO and the FITs, this is money from the public purse and therefore requires a higher degree of public scrutiny.
I was interested to see this amendment last night, but I am afraid that I did not get a chance to speak to the noble Baroness beforehand about the background to it. Not so long ago I was at a party when someone came up to me and said, “We have just installed a renewable heat boiler”. I will not reveal any names, but the person was concerned that in order to get it going, they had had to work around the regulations as they stood because of the restriction on who can receive payments and the fact that it is not the same as self-owned or self-installed renewable technologies. I would be interested to learn about the background to this amendment and certainly I will be interested to hear what the Minister has to say in response to it. It is about flexibility around the finances that are required for what are often quite capital-intensive projects. The funding has to be arranged in a flexible way so that people who do not have a lot of capital upfront are still able to engage with the RHI through arrangements that may not be standard. There is something here that I would strongly recommend the noble Baroness to look at and perhaps come back to us. As I say, it is a simply a coincidence that someone raised this issue with me personally.
On whether Ofgem is the right body to deal with this, well, if we have a Labour Government we will not have an Ofgem, so we can revisit that question then. We will certainly have a regulator, but we will look again at how these things are taken care of. Again, I thank the noble Baroness for tabling the amendment and I look forward to the Minister’s response.
Baroness Verma
My Lords, I thank my noble friend Lady Eaton for her amendment and I thank the noble Baroness for her comments. I know that we have discussed these issues on many an occasion in the Moses Room. Of course we want to make sure that the scheme is as efficient and cost-effective for the taxpayer as it possibly can be. It should deliver the benefits that have been so clearly outlined, which is something that the Government are strongly keen on pursuing.
Perhaps I may respond to my noble friend on using an alternative to Ofgem. We have seen Ofgem already successfully administering a number of schemes for the department through Ofgem E-Serve, including both the domestic and non-domestic RHI, the Renewables Obligation and feed-in tariffs. Ofgem has significant expertise in the area and has experience of running these programmes. It is also frequently evaluated to ensure that lessons are learnt both by the body and the department in order to improve the customer experience and value for money in policy administration. I think that Ofgem is the right body to be the administrator for these tools. The Government want the best kind of body to reach out to consumers. However, I take the points she raised and, listening to the noble Baroness, we have discussed on many occasions how we can improve the process. It is, of course, a complex tool so we need to ensure that it does not inadvertently exclude the very people who we are trying to assist and help.
As with all things, I must look at the upsides and the downsides of my noble friend’s amendment. What I would like to do is take it away and consider it. The amendment seems very sensible, but I would prefer to give it some thought first. Perhaps I may come back to her on Report with some further consideration.
Baroness Eaton
I thank the noble Baroness, Lady Worthington, for her comments and my noble friend for responding so carefully and thoughtfully to my amendment. I appreciate the fact that it will be considered and look forward to hearing her comments on Report. I beg leave to withdraw the amendment.
House of Lords
United Nations: Secretary-General
(10 years, 4 months ago)
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The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi) (Con)
My Lords, Her Majesty’s Government do not put forward the criteria for candidates for the UN Secretary-General role. However, we would want to see a proven leader fully committed to the values of the UN, with sufficient political authority and expertise to lead and manage such a large and complex organisation. The current system whereby the Security Council nominates a single candidate for the General Assembly continues to ensure that the candidates receive maximum support.
Lord Judd (Lab)
My Lords, does the Minister agree that we should all send a message of solidarity to the present Secretary-General for the immense burdens that he is carrying on behalf of all the people of the world? Do not the events of Ukraine and the Middle East illustrate how vital this appointment is and that it is not too soon to prepare for his successor? In preparing for his successor, is not transparency essential in order to have the good will and support of the world community, and therefore should not a specification of the terms of reference be published? Should there not be a process open to candidates from every region of the world, and is it not essential that the General Assembly, for final approval, should be able to see a shortlist with, if need be, the recommended candidate of the Security Council?
Baroness Warsi
Of course, I join the noble Lord and this House in paying tribute to the work of the Secretary-General, and I acknowledge the immense pressure of work that he currently faces as international events unfold. I also pay tribute to the work of the noble Lord, who through the United Nations Association has over many years raised the issue of reform in the selection and election of the Secretary-General. However, I go back to what I think is an essential element. The General Assembly and the United Nations generally have to approach these matters through a principle of consensus. The job is difficult enough without making sure that you have enough member state support behind you. It is therefore important that the support of the Security Council and the General Assembly is maintained during the selection process.
Baroness Falkner of Margravine (LD)
My Lords, does my noble friend accept that, by 2016, 71 years will have passed without there being a female Secretary-General and that it will be 35 years since there was a European Secretary-General? When she says that the United Kingdom Government have no specific criteria at this point, will she at least recognise that the 2006 Canadian non-paper had very clear specifications and recommendations? Finally, will she agree that the United Kingdom will at least not discourage—in other words, rule out—a suitable female candidate, should one come up in the final selection?
Baroness Warsi
My Lords, I think we all agree that, first and foremost, it is important that we find the best candidate to do this incredibly important job, and we have the pick of the world. I agree with my noble friend to this extent: we have now had eight Secretaries-General and not one of them has been female. I know that there is much discussion about a female Secretary-General being put forward, and I understand my noble friend’s position in relation to Europe having a potential candidate. I assure her that the UK will in no way try to discourage a female candidate and will get behind the best candidate, but I think she would acknowledge that the P5 would not have a candidate in that list.
Baroness Morgan of Ely (Lab)
My Lords, what is being done to ensure that the UN is being structurally strengthened to support the new Secretary-General, and to reflect the modern, varied and challenging new responsibilities of that office?
Baroness Warsi
I have the enviable task of being responsible for UN reform, among other things, and it is an area of my work that I find difficult. I am trying to find international consensus in an organisation that is now established as the organisation which responds to international affairs but with member states each putting forward their national interests. It is therefore important that reform is done in a way that makes the United Nations much more effective and efficient. The United Kingdom’s priority is to contain the UN budget, focus less on staff and more on delivery, link funding to results, prioritise countries and mandates, make better use of IT and streamline back-office work.
Lord Hannay of Chiswick (CB)
My Lords, would the Minister perhaps come back to the point of the original Question and address it slightly more specifically? Are we opposed to regional pre-emption before the process even starts? If we are not, should we not be, because is that not what narrows down the gene pool quite undesirably before we have even looked at all the possible candidates?
Baroness Warsi
The noble Lord, with his expertise, will be aware that the United Kingdom has never formally endorsed the process of regional selection in the appointment of the United Nations Secretary-General. Like many practices, it has developed over time, through non-binding resolutions at the UN, but it is important that member states around the world should feel that the whole world has an opportunity to put forward a potential candidate.
Lord Anderson of Swansea (Lab)
It is claimed that the UN Secretary-General should be either a secretary—perhaps there have been too many of those of late—or a general, like Dag Hammarskjöld. Into which category, given the current challenges facing the UN, do the Government think the new Secretary-General should fall?
Baroness Warsi
I shall not comment on potential candidates, some of whom have been named in the public domain, while others may wish to put themselves forward. I am clear that, despite the mandate of the Secretary-General, it is apparent that those with clear leadership and an ability to add their personal perspective to the issues at the UN General Assembly are those who seem to achieve real results.
Lord Dubs (Lab)
I wonder whether the Minister is aware of what happened when Kurt Waldheim became Secretary-General of the United Nations. Is she aware that at that time there were six candidates on the shortlist, five of whom were good? The Russians vetoed the five good ones and that is why Waldheim got the job. Can we be sure that that sort of shenanigans do not happen again?
Baroness Warsi
Of course, that Secretary-General was appointed in 1972 when I was one year old but I will try to recall that period. The noble Lord makes an important point. The P5 has a veto in relation to these matters. Even when we end up with nine approved votes at the UN Security Council, the P5 can still come along and cut across it. That is why it is important that we achieve some consensus before we get to that point.
Lord Hylton (CB)
Does the noble Baroness agree that transparency would be much better than a system of Buggins’s turn, which appears to have prevailed in the past? Is not problem-solving a very important criterion?
Baroness Warsi
Transparency is important, but agreement and consensus are also essential in getting off on the right foot.
Health: Midwives
(10 years, 4 months ago)
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Lord Harrison
To ask Her Majesty’s Government what is their assessment of the sufficiency of midwives in the United Kingdom.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, we are committed to improving maternity care and have charged Health Education England with ensuring that staff with the right skills are being trained and developed to meet future needs. Between May 2010 and March 2014, the numbers of full-time equivalent midwives increased by more than 1,700 and over 6,000 are in training. Health and social care is a devolved matter and the responsibility of individual devolved Administrations.
Lord Harrison (Lab)
My Lords, what are the Government actively doing to retain experienced, longer-serving midwives at a time of recruitment shortages? Why is it that, according to the National Federation of Women’s Institutes, only one in eight mothers giving birth is helped by a midwife known to her?
Earl Howe
My Lords, we attach great importance to choice in maternity care and, in particular, to each mother having a named midwife throughout the care pathway. That is what we are aiming at and what NHS England and Health Education England are charged with delivering. As regards the age profile of midwives, my advice is that there is not a particular age bulge, although we are keen to ensure that we do not lose qualified midwives who, clearly, we can ill afford to lose. However, we have made a commitment to ensure that the number of midwives in training is matched to the birth rate and, so far at least, we have been successful in that.
Baroness Manzoor (LD)
My Lords, continuity in care is very important, particularly when you consider that one in 10 women suffers from postnatal depression, and that number increases to four in 10 for teenage mothers. Can my noble friend reassure the House that, first, there is good identification of health needs for mothers during the prenatal stage; and, secondly, that there is one-to-one care during labour and postnatal so that these women are helped and supported?
Earl Howe
My noble friend makes two important points. As I said, we attach great importance to each mother being able to have throughout the care pathway a named midwife. Improving diagnosis and services for women with pregnancy-related mental health problems is one of our objectives for maternity care. The mandate from the Government to NHS England includes an objective for NHS England to work with partner organisations to reduce the incidence and impact of postnatal depression through earlier diagnosis and better intervention and support. We are clear that midwives have a key role to play in that.
Baroness Pitkeathley (Lab)
My Lords, what have we done to address demographic inequalities in the experience of childbirth, particularly for black and minority ethnic women, who often express a great lack of satisfaction with the treatment they receive during labour?
Earl Howe
My Lords, helping commissioners to reduce unwarranted variation in service delivery is one of the key roles of maternity and children strategic clinical networks, which are being established and supported by NHS England. We know from experience that these networks have a tremendously beneficial effect in ironing out inequalities in access.
Baroness Cumberlege (Con)
My Lords, will my noble friend rejoice with me that independent midwives now have professional indemnity? Does he agree that they make a very valuable contribution to maternity services, especially for vulnerable women?
Earl Howe
My Lords, we naturally applaud the professionalism of independent midwives. I agree with my noble friend that it is a positive step forward that all healthcare professionals in this country have professional indemnity insurance. We must think of the patient always and, should something go wrong, it is right that every patient is protected by indemnity or insurance.
Lord Christopher (Lab)
My Lords, is the Minister content that the measure of training, related only to the birth rate, is adequate? Should we not build in wastage?
Lord Christopher
Is a measure of the numbers training which is related only to the birth rate adequate, unless you also build in the wastage rate?
Earl Howe
The noble Lord makes a good point about building in a wastage rate. Since 2010, the number of midwives has increased by 5.75% and the number of births has decreased by 3.3%. This is why I indicated in my earlier answer that we were, in that sense, ahead of the curve. There is a great deal of work going on to ensure that there is no attrition or wastage during the training period, as this is a waste of the person’s skills and taxpayers’ money.
Baroness Tonge (Ind LD)
My Lords, what progress has been made in implementing the top 10 recommendations in the Eighth Report of the Confidential Enquiries into Maternal Deaths in the United Kingdom, especially those relating to the 19 women who died from pre-eclampsia between 2006 and 2008, which are the latest figures we have? Can the Minister also tell us when we will get a more up-to-date report on maternal deaths?
Earl Howe
My Lords, I do not have information on the confidential enquiry in my brief but, according to international statistics, the NHS remains one of the safest places in the world to give birth. The latest independent CQC survey found that maternity care in England has improved, with women reporting a high level of trust and confidence in the staff caring for them. I shall gladly let my noble friend know the latest that my department has on the issues she has raised.
Lord Hunt of Kings Heath (Lab)
My Lords, did the noble Earl see the report in the Times this morning that the Nottingham University Hospitals NHS Trust maternity unit closed 97 times in a period of 12 months due to pressure? Freedom of information requests have shown that some 62 maternity units were forced to close because of pressures in 2013. Is that not a firm indication of a shortage of midwives? Does it not show that the Government are less than active in seeking to put this right?
Earl Howe
It is up to commissioners to ensure that facilities are available to meet the needs of women who are due to give birth. There may be limited occasions when a maternity unit cannot safely accept more women into their care. That is why we have seen some temporary closures of units. Any decision to redirect women is made by a clinician as part of a carefully managed process. It is not something that suddenly happens. However, commissioners need to be alert to the risks for provider facilities that a bulge in births can create.
Learning Disabilities: Community-Based Support
(10 years, 4 months ago)
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Lord Hunt of Kings Heath
To ask Her Majesty’s Government what action they are taking in the light of the events at Winterbourne View hospital to ensure that people with learning disabilities inappropriately placed in hospital are able to move to community-based support.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, the Government are working with health and care system partners, self-advocates, family carers and other stakeholders to improve safety, quality of care and outcomes for people with learning disabilities, including reducing significantly reliance on in-patient care, by reviewing people’s care and moving them to alternative, community-based support where appropriate.
Lord Hunt of Kings Heath (Lab)
My Lords, I am grateful to the noble Earl for that. Can he confirm that the Government set a deadline of 1 June for the transfer of thousands of people with learning disabilities out of institutions such as Winterbourne View? The latest figures show that only one in 10 such residents has actually been so moved. Will the noble Earl accept responsibility for this and tell the House what the Government intend to do about it?
Earl Howe
My Lords, the Government’s mandate for NHS England in the current year includes an objective which covers Winterbourne View concordat commitments. He is right that the deadline was missed. We are not satisfied with that and we are working very hard with NHS England to set out our expectations for progress and improved rates of discharge from in-patient settings. NHS England is going to produce an action plan this August but, in the mean time, it is doing three things. It is complying with the transforming care and Winterbourne View concordat commitments, which we have tasked it to do. It will set out what progress it expects to make and by when, with milestones, and it will provide real clarity on what success looks like—an important issue if we are trying to hold it to account—and how progress will be measured.
Baroness Hollins (CB)
My Lords, is the Minister aware that in the first six months of this year, 544 new people were admitted to assessment and treatment units and only 338 were transferred? Does he agree, therefore, that prevention is as important as discharge, and that in order to achieve both of these, skilled community support and skilled specialist support in the community are urgently needed and need to be funded?
Earl Howe
I do agree with the noble Baroness. For people who, with the right support, could and should be living in community-based settings, there is a variety of reasons why sometimes that does not happen. The lack of appropriate housing can be a barrier. For others, we know that clinical decisions are preventing discharge. NHS England is looking very carefully at how to strengthen second opinion to support people in in-patient settings to challenge the reasons for their placement as and when they need to. We are looking at making some capital funding available to support the transfer of people from in-patient care to community-based support.
Baroness Tyler of Enfield (LD)
My Lords, given the figures we have just heard about the number of people with learning disabilities being admitted to costly assessment and treatment units rather than leaving them, will my noble friend the Minister say what action the Government are taking to ensure that local commissioners—in both local government and the NHS—have the necessary skills and competence to deliver the high-quality local services that are needed to allow as many people as possible to return to their communities?
Earl Howe
My noble friend is absolutely right to focus on the role of commissioners. The Winterbourne View joint improvement programme has already stepped up its activity in working with local areas, including identifying 35 areas for in-depth review. NHS England is engaging with commissioners to reinforce the importance of ensuring appropriate services for people with learning disabilities close to their homes and families. That includes looking at how funding streams can be shared with local authorities so that there is no procedural blockage in the way that money moves across the system.
Lord Wigley (PC)
My Lords, on that very point of funding, how will the Government ensure that funding in fact follows the individual and does not, as so often currently occurs, remain locked into the funding of the wrong kind of provision? In asking this, I draw attention to my registered interest as vice-president of Mencap.
Earl Howe
Lessons are being learnt almost by the day by the NHS and local government on how to pool funding and share responsibility in areas of this kind. Admittedly, most of the effort at the moment is on the vulnerable elderly but the lessons apply equally to those with learning disabilities and to ensuring that we do not have any artificial walls forming between the NHS and local government as regards the flow of money. I can tell the noble Lord that this is a major area of focus for both NHS England and the Local Government Association at the moment.
Baroness Warwick of Undercliffe (Lab)
My Lords, given the recent resignation of the director of the joint improvement programme, which was tasked with delivering the Winterbourne View action plan only 18 months ago, will the Minister let us know what the future of the programme holds and how it will work with the new group, also tasked in a similar way, led by Sir Stephen Bubb?
Earl Howe
My Lords, I have every confidence that the programme will continue as we had hoped it would, and indeed with a renewed momentum. The noble Baroness is right that NHS England has asked Sir Stephen Bubb, the chief executive of the charity leaders’ network ACEVO, to head a new group of experts and advisers to develop a national guide on how we provide health and care for those with learning disabilities. We have every confidence that Sir Stephen, with his immense experience in these areas, will be able to bring everybody together to a good result.
Lord Laming (CB)
My Lords, will the Minister assure the House that the only criteria that will be used in making these arrangements is the way to improve the quality of life of the user of the services rather than any bureaucratic processes set by NHS England?
Earl Howe
The fundamental principle that must underpin and inform all decisions in this area is about ensuring that we respect people with learning disabilities as individuals who have the same rights as everyone else, including the opportunities to make informed choices about where and with whom they live. The noble Lord is absolutely right.
Housing: Underoccupancy Charge
(10 years, 4 months ago)
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Baroness Hollis of Heigham
To ask Her Majesty’s Government whether they have any plans to change their policy following the publication of their report Evaluation of the Removal of the Spare Room Subsidy: Interim Report.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
We inherited a housing benefit system with costs spiralling and took steps to bring expenditure under control. This remains our policy. The interim report establishes an early baseline. Since the field work was completed, the numbers affected by the policy have continued to fall month on month, reported levels of arrears experienced by English housing associations have fallen, and there is emerging evidence that many landlords are adapting their building plans in response to this policy.
Baroness Hollis of Heigham (Lab)
My Lords, everything we feared about the bedroom tax has been confirmed by this research—everything. Two-thirds of affected families are disabled. As there are no small homes, only 4% have been able to downsize. They cannot move but as most cannot get discretionary housing payments, they cannot pay and stay either. So 60% are in arrears; one-third face eviction; meals are forgone; debts are mounting; grandparents are cutting back on grandchildren’s visits because they cannot afford to feed them; people cannot stay; people cannot move. Does the Minister agree and accept that the bedroom tax—the coalition bedroom tax—is profoundly wrong?
Lord Freud
This report was based on evidence from last autumn and we have had data since then that show that people are adapting. The numbers affected are falling and are now down 70,000 people; arrears have fallen in the past two quarters and rent collection remains for the Homes and Communities Agency for the social sector at 99%; homelessness numbers are reducing and are down 7% on the year. As for DHPs, we had a quarter of a million payments last year to people affected by this policy and we had £20 million returned to us unallocated. Finally, the Court of Appeal has upheld the Government’s position that DHPs are the proportionate remedy for looking after people with problems from this policy.
Earl Cathcart (Con)
My Lords, as a landlord I recall that the last Labour Government brought in this very same measure for the private rented sector. So why is Labour making such a fuss now—with the Liberals apparently jumping on the bandwagon—when all this Government are doing is rolling out to the public sector what Labour did in government to the private sector?
Lord Freud
My Lords, the private sector had the LHA introduced, as my noble friend pointed out, by the previous Government. We had to take steps to constrain the spending on that. We have taken £2 billion out of that benefit for savings. The results of that also came out last week. The final report was dramatically less in its impact than the predictions that we had. Instead of landlords pulling out of the market, they have increased their supply by 7%. There has been very little evidence of displacement; a very marginal probability of moving home; and again we have had homelessness acceptances coming down. We are on the same trajectory with the spare room changes as with the LHA changes.
Baroness Sherlock (Lab)
I am starting to wonder whether the Minister and I have read the same report—
Lord Best (CB)
My Lords, I am grateful to the noble Baroness for giving way. I thank the Minister for putting this research in hand, as he promised when the ping-ponging on this measure stopped between us and the other place. I am afraid that one cannot take very much comfort from the figures. The Minister said that the figures are pretty bad; they are, in fact, awful: 60% of people getting into arrears with only 4.5% of people making a move as a result of the measure. He said that there are some more recent figures that are better; I fear that they are not very much so. Five hundred thousand families are affected by the measure and the position remains dire, with a third of landlords—
Lord Best
Will the Minister confirm that when the space standards were introduced in the private sector, the measure was not retrospective and did not apply to all people already occupying the properties? Does he accept that it is quite different in this case, where it was applied to the lettings of existing tenants, which is why it has been so harmful and so hurtful?
Lord Freud
My Lords, I have told the House on previous occasions that the difference here is that there is very little changeover or moving within this particular group, so there is no way in which one could introduce this kind of policy on that kind of basis. It therefore has to apply to stock. I remind noble Lords that the impact assessment for this measure envisaged moving or downsizing on the part of about 50,000 people. Nineteen thousand people have moved during the first eight months, which is on the trajectory of our expectations.
Baroness Sherlock
My Lords, the Minister has read the report. The House will be aware that he has previously reassured us not to worry about the hundreds of thousands of people affected because of all the things that they can do. This report shows that every one of those has failed: they are not taking in lodgers; they cannot move; they cannot find additional hours; and they cannot downsize because there are no properties out there. This week, Chambers put “bedroom tax” into its dictionary. Is it not time for the Government to accept that they have got it wrong and make that term archaic for ever?
Lord Freud
The report was an early look at the policy. As the research says, it provides a baseline. There is evidence of people looking for work—18% of those affected are looking to earn more in work and 50% of the unemployed are doing so. As I told the House last week, the number of people in workless households in social housing is dropping dramatically. People are moving, as I just said. Nineteen thousand people have moved in the early months of the policy, which is in line with our expectation of 50,000. It is clearly stated in the report that, over two years, one might expect to see 20%.
Gangmasters (Licensing Authority) Regulations 2014
Baroness Williams of Trafford
That the draft regulations and draft orders laid before the House on 9, 16 and 23 June be approved.
Relevant documents: 3rd, 4th and 5th Reports from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 16 July.
Public Bodies (Marine Management Organisation) (Fees) Order 2014
(10 years, 4 months ago)
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Lord De Mauley
That the draft order laid before the House on 13 May be approved.
Relevant documents: 1st Report from the Joint Committee on Statutory Instruments, 2nd Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 16 July.
Birmingham Schools
(10 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Schools (Lord Nash) (Con)
My Lords, with the leave of the House, I shall repeat a Statement made by my right honourable friend the Secretary of State for Education in the other place earlier today. The Statement is as follows:
“With permission, Mr Speaker, I should like to make a Statement about the report into allegations concerning Birmingham schools arising from the so-called Trojan Horse letter. That report by Peter Clarke has been laid before the House this morning.
The abiding principle of this Government’s education policy is that schools should prepare children for life in modern Britain and, indeed, the modern world. Schools should open doors for children, not close them. That is what parents want and expect. We should be clear that this is as true for the overwhelming majority of British Muslims as it is for everyone else.
As a Government, we strongly support the right of Muslim parents to be involved in their children’s schools and their commitment to take leading roles in public life. What has been so upsetting about the history in this small handful of schools is that the success of efforts to encourage more British Muslims to take up governing roles has been damaged by the actions of a few. I sincerely hope that parents will continue to come forward to serve as governors and take leadership roles in schools.
But what Peter Clarke found is disturbing. His report sets out compelling evidence of a determined effort by people with a shared ideology to gain control of the governing bodies of a small number of schools in Birmingham. Teachers have said they fear children are learning to be intolerant of difference and diversity. Instead of enjoying a broadening and enriching experience in school, young people are having their horizons narrowed and are being denied the opportunity to flourish in a modern multicultural Britain.
There has been no evidence of direct radicalisation or violent extremism. But there is a clear account in the report of people in positions of influence in these schools, with a restricted and narrow interpretation of their faith, who have not promoted fundamental British values and who have failed to challenge the extremist views of others.
Individuals associated with the Park View Educational Trust, in particular, have destabilised head teachers, sometimes leading to their resignation or removal. Particularly shocking is the evidence of the social media discussions of the Park View Brotherhood group, whose actions,
‘betray a collective mind-set that can fairly be described as an intolerant Islamist approach that denies the validity of alternative beliefs’.
Evidence collected by Peter Clarke shows that Birmingham City Council was aware of the practices that were subsequently outlined in the Trojan Horse letter long before it surfaced.
The council published on Friday its own report by Ian Kershaw into the problems. He concluded that in some cases the council was actually a vehicle for promoting some of these problems, with head teachers being eased out through profligate use of compromise agreements rather than being supported. The council’s inability to address these problems had been exacerbated, the report found, by a culture of not wanting to address difficult problems where there is a risk of accusations of racism or Islamophobia.
We are all in the debt of Peter Clarke for the rigour that he brought to his investigation and for the forensic clarity of his findings. And we are in the debt of my predecessor, now the Chief Whip on this side of the House, for his determination in the face of criticism to invite Mr Clarke to take on this task. No Government and no Home Secretary have done more to tackle extremism than this Government and this Home Secretary. In the conclusions of the Government’s extremism task force last year, the Prime Minister made it clear that we need to deal with the dangers posed by extremism well before it becomes violent. Peter Clarke’s report offers us important recommendations to address this challenge in schools.
Our first priority after Ofsted reported its findings last month was to take action over the schools in special measures. The members at the Park View Educational Trust have now resigned, enabling outstanding head teachers from the wider Birmingham community to take on the governance of the trust and ensure a strong future for its three academies. My noble friend Lord Nash has today written to the Oldknow Trust notifying it that I will terminate its funding agreement in the light of the trust’s manifest breaches. And a new interim executive board has replaced the failing governing body of Saltley school. I pay tribute to the right honourable Member for Birmingham, Hodge Hill, and the honourable Member for Birmingham, Yardley, for their work with these schools.
The second priority is the progress which must be made by Birmingham City Council. I have spoken to Sir Albert Bore and we have agreed that I will appoint a new education commissioner within the council to oversee its actions, to address the fundamental criticisms in the Kershaw and Clarke reports, while building resilience in the system as a whole. The commissioner will report jointly to Birmingham’s chief executive and to me. If we are unable to make rapid progress with these new arrangements, I will not hesitate to use my powers to intervene further.
My right honourable friend the Secretary of State for Communities and Local Government has also spoken to Sir Albert Bore about the need to address the wider weaknesses that these events have highlighted in the governance culture of the council. It has agreed that Sir Bob Kerslake will lead a review of governance in the city council, reporting with recommendations for both the short and medium term by the end of 2014.
I want also to ensure that our system of standards and accountability for all schools should better withstand the threats of extremism of all kinds. The National College for Teaching and Leadership will take the extensive evidence provided by Peter Clarke so that its misconduct panel can consider whether any teachers involved should be barred from the profession. Advice to the panel already provides that actions which undermine fundamental British values should be viewed as misconduct. I will strengthen that advice to make clear that exposing pupils to extremist speakers should be regarded as a failure to protect pupils and promote British values. I will also strengthen the advice to make it clear that prohibition from teaching should be imposed while such cases are investigated and a prohibition without review made where misconduct is proved.
We have already published a consultation on strengthening independent school standards, which apply also to academies and free schools, including a requirement actively to promote British values. Ofsted will inspect how well all schools are actively promoting fundamental British values through their curriculum. We will provide further guidance on how to improve the social, moral, spiritual and cultural development of pupils, which is also inspected by Ofsted. We will strengthen our regulations to bar unsuitable persons from running independent schools, including academies and free schools. Anyone barred in this way will also be prohibited from being a governor in any maintained school.
Peter Clarke recommends that Ofsted should be more sensitive to the signs of emerging problems. I believe that key evidence can be hidden from inspectors, and the inspection regime needs to be strengthened further. My predecessor asked Her Majesty’s Chief Inspector, Sir Michael Wilshaw, to look at the feasibility and practicalities of introducing no-notice inspections for schools. I am pleased that Her Majesty’s Chief Inspector has already decided—and notified schools earlier this month—that he will be broadening next term the criteria that Ofsted uses to judge whether unannounced inspection is required for a particular school. HMCI believes there are advantages to extending no-notice inspection to all schools and will use his consultation in the autumn on changes to the 2015 inspection regime to consult on whether universal no-notice or a different change to the no-notice regime should be made.
HMCI has also highlighted the need to ensure that all state-funded schools meet the requirement to teach a broad and balanced curriculum. The chief inspector is clear that this is an area where inspectors will pay more attention, and the autumn consultation will seek views on whether Ofsted needs to do more to ensure that all schools meet their requirement to teach a broad and balanced curriculum.
My predecessor commissioned a review by the Permanent Secretary on whether the department missed historical warnings in Birmingham, and he will report to me later in the summer. The department has already ensured increased scrutiny of new academy sponsors and of the governance arrangements for schools seeking to convert to academy status. We have appointed regional schools commissioners, backed by boards of local outstanding head teachers, who will bring local intelligence to decision-making on academies, but I will now improve the department’s due diligence and counterextremism division’s capacity as Peter Clarke recommends, and I will ensure that the department works in partnership with the Home Office, the Department for Communities and Local Government and other agencies to improve the intelligence available to us on whether other parts of the country are similarly vulnerable to the threats that have been exposed in Birmingham.
The report also raises questions and makes specific recommendations about other important areas including: the role of the Association of Muslim Schools UK; further action on improving school governance; how to communicate better the role of local authorities with all schools—maintained, academies and independent —over safeguarding and extremism; and how we can be sure that all schools are meeting their statutory duties. I want to reflect further on these issues, as well as all specific recommendations made in the report published today, and return to this House in the autumn on steps to be taken on these matters.
Peter Clarke’s report confirms the pattern of serious failing found by Ofsted inspection reports and identifies how the actions of a small number of individuals in some schools represented a serious risk to the safeguarding of children and the quality of education being provided. We are taking action to put things right and I will not hesitate to act in any schools where serious concerns come to light in future.
However, I want to be clear that those who seek to use this case to undermine this Government’s reform agenda will be disappointed. Today there are more than 4,000 academies and free schools serving pupils and parents up and down the country. They are helping thousands of young people, regardless of their background, to unlock their potential and become valuable and rounded members of society. The expansion of the academy programme has been one of the great success stories of this Government and the actions of a small number of individuals will not divert us from this path. The programme of reform goes on. I commend the report to the House”.
My Lords, that concludes the Statement.
Baroness Jones of Whitchurch (Lab)
My Lords, I thank the noble Lord for repeating the Statement. The contents of the two reports that have led to the Statement clearly make for sobering reading. Failures in oversight and supervision go back years, to a time when the Conservative-run Birmingham City Council failed to hear the concerns of local head teachers and a delegation brought a dossier of complaints to the then Education Minister in the Lords, the noble Lord, Lord Hill, in 2010. Those complaints were registered with promises of action, only to disappear into the bowels of the Department for Education, never to be heard of again. Since then, despite repeated concerns being raised about the consequences of a lack of scrutiny of schools, we have been reassured that processes are in place to guarantee standards. However, the fact that these latest allegations came to light not through the diligence of Ofsted inspectors but from whistleblowers clearly demonstrates that these provisions were not sufficient. Does the Minister recognise that, in retrospect, the Government should have heeded the warning messages at a much earlier stage and introduced a much more robust system of oversight? Is he now in a position to share with us what exactly happened to the complaints that were raised with the noble Lord, Lord Hill, back in 2010?
I am aware of the similarities between the two reports published today, but also aware of the different tones of their conclusions. Clearly, when dealing with matters of potential community sensitivity we need to be confident in the strength of evidence before us. So we need to acknowledge that actual evidence of incitement to violent extremism or radicalism appears to be relatively weak. This does not mean that there is not serious cause for concern about the conclusions of both Peter Clarke and Ian Kershaw.
First, it is clear that all agencies involved, including the department, Ofsted and Birmingham City Council bear some responsibility for the poor governance of these schools. There are lessons here for the appointment and training of governors, as well as for the focus of future Ofsted inspections. Does the Minister welcome the recommendations on training and accountability of governors, and does he accept the case for them to be rolled out across all schools in future?
Secondly, there are concerns that secular schools are able to focus on a narrow, single-faith doctrine that rejects and denigrates other faiths, including teaching a very narrow interpretation of the curriculum. What advice do the Government propose to give in the future about the teaching of religious tolerance in both faith and non-faith schools?
Thirdly, there are concerns that girls are being segregated and given restricted access to subjects such as sport, biology and PSHE education. Will the Minister clarify how the Equality Act sits with these practices; whether girls are entitled to be treated equally and to mix with students of the opposite sex on equal terms; and how we can be assured that these rights will be protected in all schools in the future?
Finally, is it not now time for the Government to face up to the failures of their own policies for school oversight, so aptly described by Peter Clarke as “benign neglect”? Sir Albert Bore, Labour leader of Birmingham City Council, has apologised, even though his party was in power for only a short time over this period. Should the Secretary of State not also take responsibility and apologise for the failings of the Government’s education policy to monitor effectively what was happening on their watch? Does the Minister accept that what parents, teachers and communities want is an authoritative local body that can be trusted to take up their concerns and with the power to intervene to guarantee standards? This view is shared by the Local Government Association. Our policy of having local directors of school standards to support and challenge schools to improve, and to root out problems before they set in, is exactly what is needed now.
Both reports today identified systematic failure in the current structures so, while we welcome today’s announcement that there will be a new education commissioner in Birmingham, how can we be sure that these problems are confined to Birmingham? Is there not a case for rolling out this model of supervision across the country? I hope that the Minister will accept that the Government’s schools policy is no longer fit for purpose, and that he will work with us on developing a model for proper local oversight in which everyone can have faith for the future.
Lord Nash
This is not a matter for bipartisan point-scoring but one for serious reflection on the issues that have arisen. The noble Baroness is quite right that some of the evidence suggested that these issues go back 15 years, including under a previous Government and while these schools were all maintained schools. Within a few weeks of becoming aware that issues were apparent with the academy trust described by Peter Clarke in his report as the incubator, Park View Educational Trust, we had removed the members of that trust. Clearly, that shows swift and firm action.
We, too, expect all schools to teach tolerance and we have set that out in the independent schools standards. As I say, we will be improving the social, moral, spiritual and cultural guidance on this. We do not mandate training for governors. We have 300,000 governors in this country and we are extremely grateful to them for the work that they do. We expect governors to be trained where appropriate but at this time we do not think it appropriate to mandate them. The Equality Act of course applies to all schools.
As far as our policies are concerned, there is no doubt now that the academies programme, started under the previous Government and dramatically rolled out under this Government, is an outstanding success up and down the country. Schools that have been failing for years—hundreds of them—are being dramatically transformed under academy sponsorship. The Labour Party’s solution to such issues is to have 50 to 100 new directors of school standards, all with their own bureaucracies. As far as I am concerned, I know who I would rather trust to give me advice on local issues such as the ones we have seen in Birmingham. It would be head teachers, every time, ahead of local bureaucrats. That is why we have set up our eight regional schools commissioners.
I pay tribute today to the three outstanding head teachers who have come forward to take over as the new members of the Park View Educational Trust and the speed with which they are getting to grips with the issues in those three schools, to ensure that they are safe and appropriately staffed when they open again in September. I also pay tribute here to those officials in the Department for Education who have worked so tirelessly with me over the past few months to ensure that the former members of the Park View Educational Trust have stood down.
The Lord Bishop of Birmingham
My Lords, I am grateful to the Minister for bringing the Secretary of State’s Statement to the House and for the publication of Peter Clarke’s report. As he mentioned, this goes alongside Ian Kershaw’s report, which was published on Friday, about Birmingham City Council and it has the support of the Birmingham Trojan horse review group, of which I am a member. That group has published its own, wider recommendations in this complex and troubling period. Does the Minister agree that both reports are thorough and hard-hitting, and that there is much in common in their findings?
Will he also affirm that it is vital now that we have a co-ordinated effort across all interested parties and responsible bodies, not only to rectify wrongdoing and implement the welcome recommendations of both reports but to ensure that every child in Birmingham has an excellent education, preparing her or him to flourish in our liberal 21st-century democracy, so that they can start the new academic year in September confident that the proper structures, monitoring and support are in place? Can he also reassure the House that, given the arrangements he is proposing, with these rapid and responsible responses to new structures and influences in Birmingham, we will be absolutely clear by September who is responsible for what in this revolutionary period in our education system? Will sufficient resource be directed to enable local authorities and their partners, new and old, to achieve this safeguarding, which is the responsibility for all children, in whatever form of education or schools they are, and can he reassure the House that they will receive that?
May I also make a wider point about this complex matter? Faith, in a city such as Birmingham, is of great importance to a huge number of the population, which is perhaps unusual across the population of the country. The issues that we face in these reports are wider than just education and, of course, the Prevent strategy, such as making sure that proper arrangements are in place for the safety of all. Will the Secretary of State’s department consider taking responsibility for developing a new awareness and experience among all professionals, of whatever responsibility, of what lived faith looks like in a 21st century city and enable a wider conversation about faith, not only in education but throughout civil society?
Lord Nash
I welcome the right reverend Prelate’s “look forward” approach to this matter and am grateful to the diocese of Birmingham for its support for the schools and academies programme and its collaborative approach to working both with the department and with other dioceses. As the right reverend Prelate says, both reports are hard-hitting. We should all take stock and analyse all the recommendations.
As for being clear by September who is responsible for what in these schools, it is clear now today that we have changed the members of the Park View Educational Trust, which was responsible for three academies, Park View, Golden Hillock and Nansen Primary. They will become trustees of the trust. We will bring in further outstanding heads as trustees, who will be responsible between now and the beginning of September for securing the schools and analysing which teachers may have behaved inappropriately. They will not hesitate to take the right action against any teachers who have behaved unprofessionally and will make sure the schools are safe and ready for opening in September. Probably during August, we will work with potential sponsors for these schools to ensure their long-term future. This has invited a wider discussion about faith, which is very welcome.
Lord Storey (LD)
My Lords, I am grateful for the Minister’s Statement. Sometimes good can come out of a difficult situation. I have four questions to ask the Minister.
Lord Storey
I have two questions to ask him. First, does he think that there is a need for Ofsted to inspect academy chains, and that the curriculum proposals should be for all schools? Secondly, he mentioned in his Statement that a number of head teachers were eased out through compromise agreements. These compromise agreements often come with confidentiality clauses. We currently know that up to £3 million of education money is being spent on these compromise agreements. Does he not think that we ought to look at this situation? Had those confidentiality issues not been linked to the compromise agreements, perhaps we would have got to the truth of what head teachers felt sooner.
Lord Nash
To answer my noble friend’s two questions, we have so far felt that, given that Ofsted is capable of conducting batch inspections on a number of schools in a chain, as it did in Birmingham and has done on many occasions, that gives it plenty of opportunity to examine the support that those schools get from the centre. Visiting the head office—when Ofsted probably would not see very much except the office—would not tell it any more. However, we keep that constantly under review.
On the compromise agreements, when I came to work in education I was pretty shocked by the lack of due diligence that was often taken over referencing people in teaching. Of course, what can happen as a result of compromise agreements is that bad teachers just pop up elsewhere, which is described in America as the dance of the lemons. That is something that we need to look at.
Lord Sutherland of Houndwood (CB)
My Lords, there is much to welcome and to ponder in today’s report. There is an underlying issue of knowing what is going on in schools to which I will draw attention by asking two related questions. I suggest that one of the key sources will always be responsible teachers and head teachers. Is there any way of devising a route that they can follow to raise questions about serious difficulties within the school, knowing that they will be taken seriously?
Secondly, there is an issue of governance and governors. I welcome what is recommended in the report, but it is a much broader issue than that. Could a broader look be taken? I could take the Minister to schools within a mile or two of here that struggle to find enough good governors. We have to find ways of improving that situation, and that will not happen reactively in situations like this.
Lord Nash
I pay tribute to the experience of the noble Lord, Lord Sutherland, in the area of HMCI. We have whistleblowing procedures in place in the department and in the EFA. We have been discussing with Ofsted how we can improve them, and we will look at doing so.
On page 90 of Peter Clarke’s report, he says that he does not see that there is an issue with governance generally, merely an issue with governance in these particular schools. In the last 18 months, as Minister with responsibility for governors, we have dramatically beefed up our focus on governance to focus governors on three core skills, to focus governance on skills rather than representation and to view governing bodies more as non-executive director bodies. I was delighted to hear in the other place earlier this afternoon the shadow Secretary of State support the non-executive director approach. Ofsted is far more focused on governance than it was and we are increasingly working with it to make it more so.
The noble Lord is quite right about recruiting more governors. We have recently launched the Inspiring Governors Alliance to work with the CBI and other business groups to recruit more governors.
Lord Rooker (Lab)
It has been 13 years since I ceased to represent part of my city in the other place. My former constituents would not thank me if I started to play a party-political game here, so I have only one question. Will Sir Bob Kerslake’s review of governance look at the splitting of the city into three boroughs? London is no less London for having 32 boroughs dealing with social services and education. Last autumn I advised the then Secretary of State not to send in commissioners for social services and education necessarily, but to send in the boundary commissioners. With wards with an electorate of 20,000 for three councillors in that city compared to 6,000 electors for three councillors in London, there is a disconnect in democratic accountability. The elected councillors cannot possibly be in touch with things that happen on their patch. It is the only place in the country that has such a democratic dislocation at ward level between councillors and the electorate.
Change is long overdue. I even raised it when Tim Brighouse came to Birmingham. With more than 400 schools in one city, it is just not possible to manage it properly. I am not calling for the dismemberment of the city, but for the boroughing of the city in that same way that London is boroughed, so that there will be more accountability and more people will know what is going on. It is not just the governors but the elected councillors as well. Bob Kerslake seriously has to have a look at this, because although it is not the entire solution it is part of it.
Baroness Hussein-Ece (LD)
My Lords, I, too, thank my noble friend for the Statement. It is a relief that this applies to a very small number of schools, however important it is, and to note that there are serious problems of governance. It is important to underline that there is no evidence, as we saw in the lurid headlines, of a “plot” or of violent extremism.
We know that there is a difference between religious conservatism and extremism. That has not really come out in a lot of the narrative from these schools. It has been quite damaging. Can the Minister comment on that? Does he agree with me that when we talk about values, we need a shared level of standards, values and accountability for all schools, be they faith schools, free schools, academies or private schools? Would he also agree that we need to refrain from the generalisation that we have seen that stigmatises whole communities and faiths? This has been very damaging and will make it more difficult for moderate people in Muslim and other communities who want to get engaged in public life to become school governors and councillors, and to play a full role in British civic society.
Lord Nash
My noble friend is quite right about the difference between religious conservatism and extremism. We are dealing with some extremely difficult issues. We must respect all faiths, but all schools should be places where pupils start to learn about inclusivity and tolerance, not where they are excluded from society. We are focused on our pupils being adequately prepared for life in modern Britain, and the noble Baroness raises some very important points.
Lord Pearson of Rannoch (UKIP)
My Lords, do the Government agree that this scandal, like Muslim segregation and Islamist violence more generally, is a problem that arises from within Islam and can be cured only from within Islam? Given all that is happening in Africa as well, why do the Government go on intoning that Islam is a religion of peace?
Lord Nash
I think that what has happened in Birmingham is unacceptable to all the communities there, including most of the Muslim parents and teachers. I do not recognise the noble Lord’s analysis of the religion of Islam, which I see as a religion of peace. I do think that there are issues in relation to developing counter-narratives to extremism, but I do not think that there is time to go into that here.
Baroness Armstrong of Hill Top (Lab)
Does the Minister recognise that the department has to take its fair share of the blame and be accountable? It is not possible to put all the responsibility on to Ofsted for knowing what is going on in schools day in and day out. With academies, the department has the responsibility through its newly imposed regulatory system. How could it miss what was happening to girls in those schools, when many women were being dismissed from schools as cleaners, dinner ladies and so on, as well as teachers? Many of us feel very let down in this respect by the Government, with their centralised control of academies. I declare my interest as a member of Northern Education Trust and as a governor of Castle View Academy in Sunderland—so I am not against academies by a long way, but the Government have neglected these schools and have not now got the infrastructure to know when things are going wrong. What are they going to do to change that?
Lord Nash
The noble Baroness is quite right that everybody needs to take their fair share of the blame in this. Nobody comes out of this particularly well. One could say, “How did the local authority miss these issues for years?”. It was only when Ofsted did a batch inspection of 21 schools and saw a common pattern of behaviour which had accelerated dramatically in terms of threatening behaviour in recent years that it became absolutely clear what was happening. As I said in relation to the actions we have taken with Park View Educational Trust, we dealt with these matters extremely speedily. We have now substantially tightened our procedures in relation to schools becoming academies and we will, as a result of events in Birmingham, look further at that.
Lord Bew (CB)
My Lords, does the Minister acknowledge that we owe a great debt to Peter Clarke for this report and that its modulated contents disprove many of the concerns in the media at the time of his appointment? It is a modulated, precise report. As to its content, after the Minister’s Statement, I am much clearer about the Government’s thinking on the governance of these schools. However, the report also criticises the conduct of a number of teachers. I am not sure how the discussion is going to develop on the point of the teachers—as opposed to governors—whose conduct is discussed in the Clarke report.
Lord Nash
I agree entirely with the noble Lord about the great debt that we owe to Peter Clarke, one of the great investigative policemen of our time. At this precise time I cannot comment on the detail of the noble Lord’s point about the conduct of the teachers. However, I can assure noble Lords that the new trustees of Park View Educational Trust will take all appropriate action, and the National College for Teaching and Leadership will take the extensive evidence provided by Peter Clarke so that its misconduct panel can consider which individuals, if any, should be barred from the profession.
Baroness Crawley (Lab)
My Lords, as a former MEP for Birmingham for 15 years, and as a feminist, I have taken a great deal of interest in this matter. Can the Minister say what his department will do to ensure that the Equality Act is implemented in faith schools, free schools, academies and maintained schools from now on?
Lord Nash
I can assure the noble Baroness that we are extremely focused on that. We make sure that all schools, particularly when we are approving them as free schools, are thoroughly inclusive. We visit the schools, and if we see any practices that we think are inappropriate, we are very quick to draw them to the attention of the schools and make sure they are rectified. We are extremely focused on that. The noble Baroness makes a very good point.
Lord Reid of Cardowan (Lab)
My Lords, first, I thank the Minister for repeating the Statement, and I thank the authors of the two reports. I do not know the author of one of them, but I know Peter Clarke, and I have long appreciated his judgment and analysis, which come through in this report. It is obvious that there were problems in the schools, the local communities and the local authorities, and we have concentrated on that. However, without in any way laying particular personal blame or being party political, it is equally obvious that there were failings at the centre of government, and in more than one department. To put it at the minimum, someone somewhere, or a number of people, took their eye off the ball. The Minister said that procedures had been “tightened up”—I think that that was his phrase. Could he elaborate a little more on that? Can he say—if we are reviewing everything that is happening in Birmingham, in the local authorities, the schools, regarding the teachers and so on—what is the nature of the review being carried out in the Home Office and/or the Department for Education, and whether any conclusions have already been reached?
Lord Nash
I am grateful to the noble Lord for his comments, particularly given his vast experience in this area, and particularly his comments about Peter Clarke. We have dramatically beefed up our due diligence and counterextremism division in the department, and will further strengthen it. We were the first department outside the Home Office to set up such a unit. I cannot comment on the Home Office, but we will look carefully at all the issues arising out of this. I can assure the noble Lord that, in terms of analysing the individuals involved in any schools in which the department is involved in any approvals, we will use our due diligence unit very rigorously.
Police Reform
(10 years, 4 months ago)
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The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach) (Con)
My Lords, with the leave of the House I will now repeat a Statement on police reform that was given earlier today in the House of Commons by my right honourable friend Theresa May, the Home Secretary. The Statement is as follows.
“With permission, Mr Speaker, I would like to make a statement about our ongoing work to ensure the highest standards of integrity in the police. I have always been clear that I believe the vast majority of police officers in this country do their job honestly, and with integrity. They fight crime in our villages, towns and cities. They deal with dangerous criminals, strive to protect the vulnerable, keep our streets safe and have shown that they can cut crime even as we cut spending. Under this Government, crime is down by more than 10% since the election, proving that it is possible to do more with less. But as I have said before, the good work of the majority threatens to be damaged by a continuing series of events and revelations relating to police conduct.
That is why, over the last 18 months, the Government have been implementing a series of changes to improve standards of police integrity. The College of Policing has published a new code of ethics, which makes clear the high standards of behaviour that are expected from all police officers. A national list of police officers’ pay and rewards, gifts and hospitality is now published online, and their final list of business interests will be published for the first time later this summer. A national register of officers struck off from the police has been produced and made available to vetting and anti-corruption officers in police forces. The Government will legislate later this year to ensure that officers cannot resign or retire to avoid dismissal in misconduct hearings. We have beefed up the Independent Police Complaints Commission so that, in future, it can take on all serious and sensitive cases involving the police. In addition to these specific measures, many of our other police reforms—the creation of the College of Policing; direct entry into the senior ranks; the election of police and crime commissioners; the changes to Her Majesty’s Inspectorate of Constabulary—will make a positive difference when it comes to police integrity.
Since I began the Government’s programme of work to improve public confidence in the police, further events and revelations have reinforced the need for reform. We have had reports on the misuse of stop and search, and the poor police response to domestic violence. We have had the findings of the Ellison review, which examined allegations of corruption during the initial deeply flawed investigation of the murder of Stephen Lawrence. We have had Sir David Normington’s review into the Police Federation, which recommended change ‘from top to bottom’.
The measures we have introduced are vital, but we cannot stop there, so I want to tell the House about my plans for further change. I want to open up policing to the brightest and best recruits. The Government have already introduced direct entry to open up the senior ranks of the police and bring in people with new perspectives and expertise. In London, the Metropolitan Police received 595 applications for between five and 10 direct-entry superintendent posts. Some 26% of the applicants were from a black or minority ethnic background, compared with 8.6% of traditional recruits, and 27% were female. In addition, using seed funding that I announced at the Police Federation conference in May, the Metropolitan Police is setting up “Police Now”, the policing equivalent of Teach First, which will attract the brightest graduates into policing. However, I want to go further. The College of Policing will undertake a fundamental review of police leadership. The review will look at: how we can go further and faster with direct entry; how we can encourage officers to gain experience outside policing before returning later in life; and how we can open up the senior ranks to candidates from different backgrounds. The review will start immediately.
In addition to these reforms, I also want to ensure that the systems and processes that deal with misconduct by police officers are robust. That means, where there are cases of wrongdoing, they must be dealt with effectively, and, where necessary, appropriate disciplinary action must be taken. In March I announced I would be creating a new offence of police corruption through the Criminal Justice and Courts Bill, but this alone is not enough. The police disciplinary system is complex. It has developed organically rather than been structured to fit its purpose. It lacks transparency for the public, it is bureaucratic and it lacks independence.
So today I can tell the House that we will be reviewing the whole police disciplinary system from beginning to end. This review will be chaired by Major-General Clive Chapman, an experienced, independent and respected former Army officer, and I want it to draw on best practice from the private and public sectors. I have asked Major-General Chapman to look for ways to ensure that the disciplinary system is clearer, more independent and public focused. I intend to consult publicly on the policies that emerge from the review later this year. In addition to the review, I want to make some specific changes to the police disciplinary system. In particular, I want to hold disciplinary hearings in public to improve transparency and justice. I will launch a public consultation on these proposals later this year.
In my Statement on the Ellison review on 6 March, I said I would return to the House with proposals to strengthen protections for police whistleblowers. Police officers and police staff need to know that they can come forward in complete confidence to report wrongdoing by their colleagues. So the Government will create a single national policy for police forces on whistleblowing to replace the current patchwork approach. This will set out the best principles and practices on whistleblowing, and ensure consistency of approach across all forces. Following the publication of HMIC’s integrity inspection, I am prepared to consider putting the whistleblowers’ code on a statutory basis. We will also require forces to publish more information on the number of conduct issues raised by officers and the action taken as a result. From 2015 onwards, the Home Office will collect and publish data about conduct and complaints brought by police officers and police staff about their colleagues. But I still want to go further, so in the autumn I will launch a public consultation on police whistleblowing. The consultation will look at a range of new proposals to protect police whistleblowers. For example, I want to consider how we can introduce sealed investigations—which prevent both the force and suspects learning that an investigation is taking place—into serious misconduct and corruption by police officers.
I also want to take an in-depth look at the police complaints system. Last year, I announced reforms to the IPCC to ensure that all serious and sensitive cases are dealt with by the IPCC. This included the transfer of resources from the police to the IPCC and measures to ensure that the IPCC has the right capacity to deal with demand. As I told the College of Policing conference in October, this work is on track and the IPCC will begin to take on additional cases this year. But now is the time to build on those reforms. Public satisfaction surveys on the handling of complaints show that satisfaction levels remain consistently low. According to the Crime Survey for England and Wales, less than a quarter of those who complain to the police are satisfied with the outcome of their complaint. The overall number of complaints being handled independently is still far too low. This year, a review undertaken by Deborah Glass, the former deputy chair of the Independent Police Complaints Commission, found that 94% of cases referred to the IPCC in 2012 were referred back to be dealt with by the police.
Police and crime commissioners are locally developing new and innovative approaches to police complaints. In Thames Valley, Anthony Stansfeld has announced a complaints, integrity and ethics committee to provide scrutiny on how the force handles complaints. In Greater Manchester, Tony Lloyd has appointed an independent complaints ombudsman to resolve complaints before they become part of the complaints system. We need the police complaints system to keep up with the changes we have seen in police structures, to reflect the changes made locally by PCCs and chief constables, and to meet public expectations. So today I will launch a review of the entire police complaints system, including the role, powers and funding of the IPCC and the local role played by police and crime commissioners. The review will look at the complaints system from end to end, examining the process every step of the way and for all complaints from the most minor to the most serious. The review will commence immediately and conclude in the autumn this year. It will include a public consultation on proposals for a system that is more independent of the police, easier for the public to follow, more focused on resolving complaints locally, and has a simpler system of appeals.
The measures that I have announced today will ensure that we are able to examine the entire approach to cases of misconduct, improper behaviour and corruption. But in working to ensure the highest standards of police integrity, I want to leave no stone unturned. This year, I commissioned Her Majesty’s Inspectorate of Constabulary to carry out a review of anti-corruption capability in police forces. HMIC is also carrying out an inspection of police integrity as part of its planned programme of inspections for 2014-2015. In addition, I have agreed with the chief inspector that HMIC’s new programme of annual inspections of all police forces, which will begin later this year, will look not only at a force’s effectiveness and efficiency but at its legitimacy in the eyes of the public. Every annual inspection will therefore include an examination as to whether each force’s officers and staff act with integrity.
Together these measures represent a substantial overhaul of the systems that hold police officers to account. They will build on our radical programme of police reform and they will help to ensure that police honesty and integrity are protected, and that corruption and misconduct are rooted out. That is what the public and the many thousands of decent, dedicated and hardworking police officers of this country deserve. I commend this Statement to the House”.
My Lords, that concludes the Statement.
Baroness Smith of Basildon (Lab)
My Lords, I am grateful to the Minister for repeating the Statement. Most of us at some point in our lives have contact with the police: as witnesses—not as victims, we hope—reporting a crime; and in their community role, which at its best is excellent and at its worst is minimal. At their best the British police are rightly held in national and international high regard. They are praised by communities and they encourage and justify public confidence.
However, we have also seen evidence of policing going wrong, when its integrity cannot be relied on and public confidence is not justified. Issues such as the Hillsborough disaster and the investigation into Stephen Lawrence’s murder—and the appalling police actions following those shocking events—make it clear that a new framework is needed. The IPCC has too often done too little too late.
From talking to police officers, it is clear that they themselves feel the criticism of their profession more acutely than anyone else, because all the professionalism and integrity on which they pride themselves is undermined by the actions of a minority. We have already initiated a review of ensuring stronger actions on standards in policing. The noble Lord, Lord Stevens, led the independent commission that made a number of recommendations: a new stronger police standards authority, replacing the IPCC and HMIC with the power to initiate investigations; chartered registration for all police; the ability to strike officers from the register; and high professional and ethical standards for all officers.
I had hoped that we would have seen some of those issues incorporated in today’s Statement and an indication that some action is taking place. Instead we are going to have a review of the police disciplinary system and a public consultation on disciplinary hearings; as well as the existing Ellison review we are going to have another consultation on whistleblowing; we have got a review on police leadership; and we have a review on the police complaints system, including a review of the IPCC and the role of the police and crime commissioners. Just to confirm in case I have got it wrong, I count that as three reviews and four consultations. I am not necessarily against these reviews in areas in which we want to see progress, but so many reviews and consultations are a poor excuse for little or delayed action. How many reviews do the Government need to tell them that the IPCC is not working and that a piecemeal, sticking-plaster approach to reform is not what is needed?
The Statement begs far more questions than it gives answers. We shall come to some of them today but I hope that at some point we can have a longer debate on this issue. I am sorry that I find the Statement disappointing. It does not give me confidence that the Government will tackle the failures in the system with any sense of urgency or understand the scale of reform that is needed. So many reviews seem to indicate that the plan is to kick reform into the long grass well beyond the next election. The public and the police deserve better.
Yesterday in the Moses Room we debated the Government’s proposals relating to the by-election following the tragic and untimely death of Bob Jones, the police and crime commissioner in the West Midlands. Despite some worthy candidates and officeholders, there is little interest in and support for the role of the PCCs, with humiliating turnouts—just 14% across the country—in the 2012 elections. The cost of those elections, and the by-election in August, would have paid for hundreds of police officers at a time when every police force is facing swingeing cuts. One has to ask whether this is value for money.
I am sure the noble Lord has spoken to police officers, as I have. They have told me that the thin blue line is getting thinner and thinner. They feel they are unable to do their job as they want to and should be able to. The reforms that we and they expect seem no nearer with so many reviews and consultations. Those delays hit their morale, especially when they see convictions falling.
For example, in my home county of Essex, the investigation into the Colchester murders is drawing officers away from other parts of the country. They are having to leave the policing and investigations in their areas to undertake mutual assistance in Essex to ensure that they can effectively investigate these dreadful murders and police the area in Colchester. I have been told that this has meant that some officers have been on permanent 12-hour shifts for three weeks. That has taken its toll.
I do not know whether the Minister has seen the sickness figures for Essex but, in 2009-10, Essex Police lost 27,654 days to sickness. In the last year to April 2014, with fewer officers in Essex Police, that has risen to a staggering 41,251 days. Is the Minister as shocked and as worried as I am that the sickness levels in the Essex Police—and I have no reason to expect that Essex is different to anywhere else—have risen so dramatically since this Government have been in office?
We are right to expect the highest standards from the police, but does the Minister agree that the police also have a right to expect the highest standards from the Government in tackling police reform issues more quickly and in making effective use of resources?
Lord Taylor of Holbeach
The noble Baroness has picked up from where we were talking yesterday. I challenged her on how she viewed the role of the PCCs under a future Government headed by the Labour Party. She had no answer then—and it would appear that she has no answer now—as to what role they might have.
I agree with her about Bob Jones. He played an important role in the policing of the West Midlands area. I am sure she agrees with me on the role that Nick Alston plays in Essex and the important and innovative way in which he has undertaken his responsibilities there. Accountability to local communities, through the PCC, is at the heart of policing and I agree with the noble Baroness that it would be very useful to discuss these issues at a future date. I would like to hear how she plans to deal with police accountability to local communities.
The noble Baroness is right about how much we depend on the police and that they are held in high regard by all of us. She pointed to a couple of cases—Hillsborough and the tragic murder of Stephen Lawrence and the investigations thereafter—which raised questions for all of us who are interested in police integrity. I agree with her that professionalism is undermined by misconduct. I am sorry the noble Lord, Lord Stevens, is not in his place today and it is a pity that he has not participated in police debates recently, because his report was a genuine effort to look at ways of dealing with this matter. However, the Government are responsible and must take their own view of how to deal with these matters. They quite rightly chose not to merge the Independent Police Complaints Commission with HMIC but to look at the role of these bodies separately, through reviews which will report quickly, in the early or late autumn. These will find ways of making sure that the pattern of accountability which we set for the police and the ability to inquire into police misconduct effectively can be set in place promptly. It would be reckless to do that sort of thing without proper review and consultation. I make no apology on behalf of the Home Secretary for her announcement of those reviews. They are a way of making sure that in future we have a structure which is capable of satisfying demands for the highest standards of policing.
Lord Dear (CB)
My Lords, I welcome the Statement. I endorse its subject matter and I am delighted to see leadership mentioned. It does not get a bold headline but it is in there and Members of your Lordships’ House will know that I have pressed that subject before. The fact that leadership needs ventilation by attachment to outside bodies is well taken. I have two questions for the Minister: one on leadership and one on another matter. Does he agree that, with good-quality, robust, visible leadership, all the issues of probity, ethics, due process, professionalism and so on are almost superfluous because they would flow naturally from it? Without good-quality leadership, any of the things I have enumerated would struggle to succeed. Leadership, therefore, needs not only to be endorsed, as it is in the report, but lifted to the top of the list, together with a proper career path for those who are recruited into the service with those attributes. Will leadership be one of a number of issues or is it going to be one of the prime issues that will lead the rest through?
Secondly, if leadership is a key to the door, this is surely a door with at least two locks. We have talked about the first metaphorically. The second key to the door is the structure of the police service. There is nothing in the list we have heard today on structure. There is a balance to be struck which is, sadly, out of kilter at the moment. Wherever I go in the police service or whenever I talk to the many people who are outside the service but interested in it, the question is always why we do not have a national force or a regional force; there are too many forces. I take no view on that other than it needs addressing. I am a great believer in loyalty to cap-badge and locality but the fact that we have the National Crime Agency at one end and police and crime commissioners at the other means there is a great gulf in the middle. So my question to the Minister is: will there additionally be an in-depth review, perhaps along the lines of what has been mentioned in the Stevens report, of the whole structure of the British police service, in which leadership and everything else can flourish?
Lord Taylor of Holbeach
I am grateful for the support of the noble Lord, Lord Dear, who speaks with a great deal of authority on this whole issue.
The question of leadership is at the heart of the Statement because, as the noble Lord will know, the Home Secretary recognises that leadership is the key to achieving police reform. The noble Lord will share that view. It is therefore very much a key feature of this Statement. Probity is important and the noble Lord will understand that the reinforcement of the professionalism of the police by having proper measures for probity as part and parcel of this package is a very important thing. I hope the noble Lord will also acknowledge that the establishment of the College of Policing has led to a remarkable transformation of policing. Indeed, the leadership that it is providing to the force through the code of ethics and the many other aspects of policing that it is addressing is very important.
I agree with the noble Lord that in the long term we perhaps need to look at the structure and the balance of resources. There will always be arguments. I come from a very rural part of the country, where it is very easy for people to feel almost overlooked. But there are also places where the pressures on policing are much greater than they are where I live. Those issues will not go away. What the Government have done with the formation of the National Crime Agency is facilitate the ability to deal effectively with those things that operate across borders while at the same time enabling local policing to take place, governed by local police and crime commissioners.
Lord Tebbit (Con)
My Lords, does my noble friend not agree that this report is a tale not so much of poor structures—although there are poor structures—but primarily of a failure of leadership in the police force, as the noble Lord, Lord Dear, suggested? Therefore, will he accept that I welcome the concept of more direct entrants into the police force, and I hope that special priority will be given to members of the Armed Forces who are being made redundant despite their fine records, who could come into the police force and do great good work? If there is a structure that needs changing, it is that we should re-establish a proper college for the senior officers of the police force to be induced into the police force and to take the leadership role in it.
Lord Taylor of Holbeach
I agree with my noble friend. It is certainly the case that many people who have been active in the Armed Forces have qualities that could be important in policing. I do not know that I would go as far as to say that they should be given priority but they should clearly be encouraged to apply for those posts.
Lord Paddick (LD)
My Lords, while I welcome the Statement by the Home Secretary—and clearly there are serious issues with the current investigation of police complaints and the police’s disciplinary procedures—is the Home Secretary aware of the dangers of articulating direct entry at a senior level and changes to the inspectorate of constabulary, where we now have for the first time a Chief Inspector of Constabulary who has no experience of policing and a majority of inspectors who have no experience of policing? Is she also aware of the impact on senior officers of the utmost integrity who have spent their whole careers in the police service of saying that those changes are a positive difference to police integrity, and the impression that she appears to be giving to the public about the integrity of the police service at the moment? Is the Home Secretary aware that every time she runs down the police service in this way it makes the police service less effective because the police service relies on public confidence and trust to ensure that the public give information and support the police in their work?
Lord Taylor of Holbeach
I refer my noble friend to the second paragraph of the Statement that I have just read, in which the Home Secretary pays tribute to individual police officers and the way in which they conduct themselves, “honestly and with integrity”.
If I am honest with my noble friend—and I think I owe it to him to be honest—the way in which he presented his question shows all the problems that policing has: it is the notion that only the police can know how to manage the police. What the Home Secretary has done with this series of reforms is to say to the police service, “There are better ways of doing these things. Other people will be able to get you to the place you want to be”. It is very important that we back those changes. At the heart of it all, the degree to which the police have seen themselves and their problems as being something for them alone is something that the public are no longer prepared to tolerate.
Lord Blair of Boughton (CB)
My Lords, I agree with, and congratulate, the Home Secretary and the Home Office team on a great deal of this Statement. A clear wind of change needs to blow through the police service and it is to be welcomed. A great deal, but not all—I will not tire the House with a view on PCCs; the Minister and I have discussed that enough. My question refers to an odd phrasing in the Statement that I have never come across before. The phrase of “sealed investigations”—I use that term in inverted commas—into police corruption. The police service, especially the Met, has for years carried out secret and successful investigations into police corruption.
I was talking about the Statement to the noble Baroness, Lady Manningham-Buller. We agreed that her officers had assisted the Met in some of those inquiries. I carried out an overt inquiry into police corruption which led to prosecution and convictions at the Old Bailey. The idea that I would have withheld the information I was receiving from the man in charge of running the police service from the top, who at the time was the noble Lord, Lord Condon, would be unthinkable. I ask the noble Lord to ensure that those charged with this initiative seek to learn from the previous experience of those who have spent most of their lives investigating police and other corruption, including some of those who sit in your Lordships’ House.
Lord Taylor of Holbeach
I am very happy to take the noble Lord’s advice on that matter. What he had to say was very interesting.
Lord Elystan-Morgan (CB)
Does the noble Lord recollect, and indeed agree with, the historic words of the late Lord Callaghan in relation to the police when he said that our police are not a gendarmerie, they are not a corps d’élite, they are citizens in uniform? Does he accept that, although sophisticated systems may well assist the police, the essence of being a police officer is very much encapsulated in the words of James Callaghan? While accepting—indeed, the noble Lord will remember that I raised on many occasions the need for a comprehensive inquiry on the lines of that conducted by Sir Henry Willink in the early 1960s. There were so many problems that coalesced and it was the only way of dealing with them.
It seems to me, respectfully, that the inquiries that are now being considered are indeed wide-ranging and deep-seated. A great deal will depend on the collation of the evidence. I would ask for one matter, which has already been raised by my noble friend, to be considered in addition. We should ask ourselves the question whether, in the 21st century, we can carry on for very much longer with 43 police forces without considering a process of rationalised amalgamation.
Lord Taylor of Holbeach
That takes us back to a point made by the noble Lord, Lord Dear. I think that I explained that the issue appears different from different points of view. I am not sure that a change in size or relocating a responsibility to a regional level or whatever would necessarily lead to more effective policing—in fact, my own prejudice suggests that it would not. However, I agree with the noble Lord’s dictum. It goes back further than Jim Callaghan to Peel himself, who said that the people are the police and the police should be the people. That is the concept that lies behind the British police force, which certainly differs from police forces in other parts of the world.
Lord Harris of Haringey (Lab)
My Lords, we are grateful to the Minister for repeating the Statement and for telling us of this blizzard of inquiries that the Home Secretary is setting up—I see him shaking his hand as though he feels that that is being pejorative. The point to which I hope the Minister will respond is that these are all interrelated issues; they have an impact on each other. Single, separate inquiries are not necessarily the best way to resolve all these matters. There is a question of how all this will be made to cohere and to be effective in delivering the sort of police service that I am sure all noble Lords want.
The Minister also referred to requirements that would be placed on the police to report—I think that it was in relation to whistleblowers and what happens to the issues that they report. Does the Minister agree with me, with those in Her Majesty’s Inspectorate of Constabulary and with those in the Independent Police Complaints Commission who think that one aid to transparency would be the proper recording by the police of those instances in which they use restraint or force against members of the public, and for those statistics to be publicly available so as to be measured against any complaints that may be received?
Lord Taylor of Holbeach
When I was waving my hand, I was not making an offensive or hostile gesture to the noble Lord, Lord Harris; I just wanted to explain that they are not inquiries but reviews. They are reviews that are taking place with the Home Office. He wanted to know how the reviews would work together. They are all short term and are designed to report within the next six months, with some even shorter, in order to bring together, as the noble Lord quite rightly pointed out, the parallel policy formation that will be necessary to make sure that we have coherence.
On the accountability of restraint, I will suggest that that is something that the College of Policing could consider. It is the sort of issue on which it quite rightly makes recommendations and issues guidelines. I am sure that it will be interested in the noble Lord’s comments, but I cannot comment today.
Lord Marlesford (Con)
My Lords, the “Plebgate” incident at the gates of Downing Street took place on 17 September 2012. At that time, the commissioner of the Met decided to investigate himself. Does my noble friend recollect that, when he answered a Question from me on 1 April this year, 18 months after the incident had happened, he said, first, that HMG had no role in deciding who should investigate it? Therefore, I ask him whether in future it would be possible for the Commissioner of the Met to decide to investigate such an incident rather than having it independently investigated.
Secondly, my noble friend told me in his Answer that although the IPCC had requested that the Metropolitan Police should publish its report once the misconduct proceedings had been concluded, it would be for the Metropolitan Police to decide whether to publish the report. Does that example not reveal a very unsatisfactory state of affairs? And, incidentally, when will we get the final report on that incident?
Lord Taylor of Holbeach
I cannot answer my noble friend on the latter point. All I can say is that the events surrounding my right honourable friend Andrew Mitchell and the process that followed are among a number of issues informing the present debate about policing and the way in which the police deal with complaints. It is good that my noble friend has had the opportunity of raising the matter again today; it belongs to a whole collection of matters, including Hillsborough and the Stephen Lawrence murder, that have led us to believe that it is right for us to undertake these reviews.
Wales Bill
(10 years, 4 months ago)
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The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson) (LD)
My Lords, the Bill before us today continues this coalition’s ambitious programme of reforms to devolved governance in Wales. We have already achieved the commitments in our programme for government relating to Wales, including delivering the 2011 referendum on full law-making powers for the Assembly and establishing the Commission on Devolution in Wales—the Silk commission—which has since published two detailed reports.
I pay tribute to Paul Silk and his commissioners, including my noble friend Lord Bourne, for their two excellent reports. The commission included representatives from all four political parties in the Assembly, and reached unanimous agreement on its recommendations. I hope that a similar spirit of broad consensus will exist in this House in respect of this legislation.
The Bill implements the vast majority of the recommendations that the Silk commission made in its first report, devolving an exciting package of tax and borrowing powers to the Assembly and Welsh Ministers. These reforms provide the tools and incentives for the Welsh Government to grow the Welsh economy; make the Welsh Government more accountable for raising some of the money they spend; and deliver borrowing powers that will enable Welsh Ministers to invest further in Welsh infrastructure.
I now turn to the detail of the legislation. The Bill provides for the introduction of a Welsh rate of income tax. As the Silk commission recommended, the devolution of income tax powers would be subject to a referendum, should the Assembly decide to trigger one. The devolution of income tax powers to Scotland was subject to a separate referendum question in 1997, and it is only right that people in Wales should decide whether income tax powers should be devolved to the Assembly.
Should the Welsh people vote for an element of income tax to be devolved—and I sincerely hope they will—it would provide a significant incentive for the Welsh Government to grow the Welsh economy and deliver a real-terms boost in revenue—money that the Welsh Government could then spend on key services such as health and education.
In the event of an element of income tax being devolved, the UK rates would all be reduced by 10p for Welsh taxpayers and the Assembly would set a single Welsh rate of income tax for all three income tax bands that would be paid alongside the reduced UK rates; this is the so-called lock-step mechanism. Noble Lords will no doubt be aware that the proposal has generated some intense debate, not least as the Silk commission recommended that the Assembly should be able to set separate Welsh rates of income tax for each of the three income tax bands.
The Government recognise that there are arguments for and against the lock-step mechanism, but we continue to believe that the approach set out in the Bill is appropriate for Wales. Given the porous border with England—almost half of the Welsh population and 10% of the English population live within 25 miles of the border—the changes to individual income tax rates in Wales could have wider effects than similar changes in Scotland.
It would not be logical to provide more flexible rate-setting powers in Wales than in Scotland. The Government have therefore decided that the lock-step is the best system for encouraging the Welsh Government to grow the overall tax base in Wales while safeguarding against the risks of damaging cross-border tax competition and increased tax avoidance.
We are now less than two months away from what I consider to be one of the most fundamental decisions in the history of the United Kingdom. I, along with almost every other noble Lord present, sincerely hope that the people of Scotland choose to remain united with the peoples of Wales, Northern Ireland and England. Nevertheless, the Government recognise that even a clear no vote may well lead to further income tax devolution to Scotland.
Having said that, we are not there yet, and I would not wish to pre-empt that debate. The Government remain open to revisiting the arrangements for income tax devolution in Wales as any changes are brought forward in Scotland; but, as I explained, there are differences between Wales and Scotland, particularly in the nature of their borders with England.
The Bill also devolves powers over stamp duty land tax and landfill tax to the Assembly, giving it the ability to devise a system of tax on land transactions and landfill specific to Welsh needs. That will provide an independent revenue stream for the Welsh Government to borrow against and give them additional tools to manage housing and waste management policy in Wales, both of which are already devolved.
The devolution of tax powers is intrinsically linked to the devolution of borrowing powers. In addition to powers relating to current borrowing, the Bill provides the Welsh Government with the ability to borrow up to £500 million to invest further in capital infrastructure in Wales. That is a generous limit, which reflects the independent income generated through the two devolved taxes, and which can be increased if additional taxes, such as an element of income tax, are devolved. Crucially, it will allow the Welsh Government to move on with much needed infrastructure investment, including improvements to the M4 around Newport.
The Government have been criticised for linking the borrowing limit to the income from devolved taxes. However, we have been clear that any borrowing must be contingent on the Welsh Government’s ability to pay that money back. You or I would not get a reputable loan without a means of repaying it, and Governments should be no different.
Finally with regard to fiscal reforms, the Bill devolves responsibility to the Assembly for its own budgetary arrangements, enabling it to decide how it wishes to scrutinise and approve its annual budget.
I now turn to Part 1, which includes a number of important electoral and constitutional reforms for Wales. Clause 1 deals with the move to permanent five-year Assembly terms. Noble Lords will recall that the scheduled 2015 Assembly election was moved to 2016 by the Fixed-term Parliaments Act 2011 in order to avoid it coinciding with the UK general election. The Bill makes the change to five-year terms permanent, following the Government’s 2012 consultation on future electoral arrangements for the National Assembly. This change will make it less likely that Assembly and parliamentary general elections will occur on the same day in future. I hope that we would all agree that it is important that Assembly elections are contested, wherever possible, on issues specific to Wales and are not overshadowed by wider issues that often dominate parliamentary elections.
The Bill also overturns the ban on candidates standing for election in both a constituency seat and on a regional list in an Assembly election. We are restoring the position to that set out in the Government of Wales Act 1998 and reversing the ban imposed by the then Labour Government in the 2006 Act. That change was made against the wishes of all the other major political parties in Wales and against the advice of the Electoral Commission and electoral experts in Wales. Noble Lords will be aware that, for Welsh Members of the Labour Party in the other place, judging by column inches in Hansard, this is seemingly the most important issue in the entire Bill. Important though this issue is, the Bill simply reverses a change that should not have been made in the first place. It restores fairness to Assembly elections, which the ban on dual candidacy took away.
The Bill also prohibits dual mandates between the Assembly and the House of Commons. The Government do not believe that it is possible for an Assembly Member to represent their constituents effectively and to devote their full attention to their role as an Assembly Member if they must also spend a significant portion of their time in Westminster. From now on, politicians elected to both legislatures will need to make a clear choice whether they wish to serve as a Member of Parliament or an AM. The Bill does not impose a similar prohibition on your Lordships, as we do not have the same constituency commitments or the requirement to attend this place regularly. At the request of the Welsh Government, this legislation also formally enshrines that name in statute. This title has been common parlance for the Welsh Assembly Government since the advent of full lawmaking powers in 2011 and it makes sense for legislation to catch up with the reality on the ground.
Finally, I would like to say a little about the second Silk report. The commission has made some crucially important recommendations about the future governance of Wales within the United Kingdom, most notably by recommending a move to a reserved-powers model similar to that in Scotland. The move would involve a fundamental, top-to-bottom change to the Welsh settlement and is not something which could be entered into lightly or done quickly.
In responding to the report’s publication in March, and while welcoming the report, the Government made clear that the Bill is not the right vehicle for implementing its recommendations. Let us implement the commission’s first report before we turn our minds to the second. Including a whole raft of additional powers in the Bill would serve merely to delay its progress and jeopardise its enactment in this Parliament. Much better that these matters be left for the next Government to take forward, giving all political parties the opportunity to seek the endorsement of the electorate through party manifesto commitments.
This Government believe that devolution should be used to give Wales a competitive edge. It should give its politicians the ability to make decisions for the people they serve, becoming increasingly accountable to them as a result. The Bill delivers on that. I commend it to the House and beg to move.
Baroness Morgan of Ely (Lab)
My Lords, I thank the Minister for outlining the shape and clauses of the Bill. The timing of the Bill is extremely sensitive, as the noble Baroness hinted, with this Second Reading taking place before the Scottish referendum and the Committee stage coming after that referendum. The Bill will therefore be a moving feast. The constitutional implications and the political response in Scotland, and in the rest of the United Kingdom, will need to be carefully considered after the referendum vote, irrespective of the outcome in September. It was interesting to note that the Minister stated that further discussion following the referendum will be possible on certain aspects of the Bill.
We also have a new Secretary of State for Wales in Stephen Crabb, and it was lovely to see him at the opening of this debate. While the previous Secretary of State, David Jones, seemed to have a rather ambivalent attitude towards devolution and despite the fact that the new incumbent has proclaimed himself in the past to be a self-confessed devo-sceptic, pleasingly he appears to have seen the light in recent weeks and has promised to develop a better relationship between the Government and the Welsh Assembly. We shall give him the benefit of the doubt and look forward to this being the case.
We are also entering a pre-election period where manifestos are being drawn up and there is an increasing awareness of the overcentralisation of the state in London. In addition, we are dealing in the Bill with recommendations that have been largely taken up as a result of the Silk 1 commission. Since then, however, Silk 2 has been published and it would seem strange not to take the opportunity to discuss some of the suggestions of that report. On the whole, I shall desist from that temptation although there is one notable exception, to which I shall allude later.
Before I start, however, it is worth pointing out what my motivation is and always has been in relation to devolution in Wales. As a founder member of the cross-party Yes for Wales campaign in 1997 and having then been on the team, along with the noble Lord, Lord Bourne, to draw up the initial standing orders for the Assembly, I was and am a lifelong supporter of devolution. I even remember wearing a sticker to school as a 12 year-old in 1979 in support of that doomed campaign when it took place. However, my motivation has never been rooted in any romantic, nationalist or even patriotic ideals. Neither is it controlled by a fixation on limiting the role of the state. Some would argue that this has been attempted in the Bill through the promotion of competitive taxation, which will inevitably lead to lower taxation across the United Kingdom and therefore a reduction in the size of the state. My motivation has always been to do what is best for Wales: making decisions close to the people, taking local circumstances into account and, crucially, ensuring that the people of Wales, particularly the poorest, are not left worse off.
Wales remains one of the poorest parts of the UK, although the unemployment rates are falling fast thanks to some innovative measures by the Welsh Labour Government. It is absolutely right that Wales continues to benefit from the UK Treasury receipts. The nature of the politics I believe in means that there should be a sense of social solidarity across the whole of the United Kingdom. In Wales, we have more of a sick population due to our industrial heritage, which helped to create the historic wealth of the United Kingdom. We also have a proportionately higher ageing population, many of whom have moved from England—and we happily welcome them to our beautiful country. Nevertheless, there is and has been hitherto a sense that these conditions and historic legacies should be recognised and that there needs to be a redistributive mechanism from the richer centre to the poorer periphery.
However, Wales has seen significant cuts in recent months and years. The IFS has suggested that the total block grant allocated by the UK Government to Wales in 2013-14 is 9.4% lower in real terms than it was in 2010. Further cuts have been announced for 2015-16 which, if implemented, would take the cut to 12%. There has been a 31% cut in the amount earmarked for capital expenditure. That cut in capital expenditure has been a severe handicap to the Welsh Government’s ability to invest in projects and infrastructure that could increase economic activity and grow the economy. Central to the Bill and the key reason why we in the Labour Party are anxious to support it is that, for the first time, the Welsh Government will have the power to borrow.
Let me underline, however, that it is critical that the ability to borrow should not be used by the Government in Westminster as an excuse to cut funding that should otherwise come to Wales. The focus so far has been on the need to borrow in order to invest this money on improvements to the M4 motorway. That commitment was announced by the Welsh Government last week and has received support, in particular from the business community. I believe that that is crucial, but we need to be sure that a similar project in the north of England, for example, would not have been funded out of this Government’s central pot once the Barnett formula has been taken into account.
The ability to borrow is crucial, but we would like to question in Committee why the level of borrowing allowed for Wales is so low. It has been suggested that the mechanism that determines the borrowing levels in Scotland has been used as a template for Welsh borrowing. However, we on these Benches shall argue that there has been an inconsistent approach, and that both Northern Ireland and Scotland have been allowed to borrow irrespective of the ability to raise the commensurate amount through their revenue-raising at a devolved level. Neither has the amount Wales is allowed to borrow taken into account the fact that Wales, in relative terms, has very little to make in terms of PFI payments compared to Scotland. Ideally we need a mechanism in this Bill to allow the Welsh Government to borrow more in future. We need to be assured that a degree of flexibility is allowed in relation to the conditions of borrowing. The ability to borrow, at least initially, is predicated on the fact that two specific taxes will be devolved to Wales: stamp duty and landfill tax. We can consider the benefits and disbenefits of these taxes in Committee, but it is worth noting that the nature of both these taxes is that they can vary considerably from year to year. There has been an agreement that, due to the nature of the variability, an adjustment can be made, but I would like to probe a little further in Committee on the nature of the adjustment deal and how watertight this agreement is.
The disbenefits are obvious. Being part of a larger group means that hitherto Wales has been pooling the risk with the rest of the UK. Probably the most controversial part of this Bill is the power to raise income tax, subject to a number of criteria. The previous Secretary of State for Wales argued, along with the Liberal Democrats, that he would be pushing for a 1p cut in income tax, suggesting that that would be a stimulant for investment and economic growth. He could well be right. However, reducing the Welsh rate of income tax by 1p, as suggested, would cost £200 million in terms of cuts to services. It will be interesting to see how the new Secretary of State feels about that, especially given that he has said that his,
“opposition to devolution … has been driven by a belief that … devolution would foster and feed an increasingly separatist and socialist discourse in which sensible Conservative policies that could promote national cohesion, economic liberalism and”—
note—
“smaller government would find little oxygen for survival”.
National cohesion is the last thing that we will see as a result of tax competition. Smaller government, however, would inevitably be delivered. Just imagine cutting 7,700 nurses, which is what £200 million represents, in the hope that the economy would grow. It could happen, but it would be a huge risk at the expense of central public services. It should be noted, however, that £200 million should also be set in the context of an overall budget for Wales of £15 billion. It must be said that that is pretty small change, and probably would have a negligible effect on the efforts to change the economic fortunes of the country.
Even if the economy did grow, much of that growth would return through income tax receipts to the central UK Treasury, and would go only some way to top up the payments to services cut in Wales. Let us not forget that only 4,000 individuals in Wales paid a top income tax rate of 50p in 2010-11, and that more than 90% of the people of Wales pay a basic rate of tax. The Government believe that devolution should be used to give a competitive edge to Wales, and that the powers devolved should be used to grow the economy. My fear with these figures, however, is that if we are to engage in any kind of tax competition with the rest of the UK, Wales will come out the loser. That is great if you are chasing some kind of nationalist dream of self-dependence; it is a disaster if you are poor and do not want your services cut. We want no race to the bottom. This would prove detrimental to all parts of the United Kingdom.
As the Minister has set out, there are cross-border implications of income tax competition. We would like to address the need for a comprehensive, cross-border Treasury impact assessment which takes into account the fact that 48% of Welsh people live within 25 miles of the English border, with 10% of the English population living within 25 miles on the other side; that is, 6.3 million people. It is worth contrasting this with Scotland, where just 4% of the population lives within 25 miles of the English border, with 0.5% of the English population living within 25 miles on the other side; that is just 450,000 people. The complexity associated with different tax rates, therefore, is much higher in Wales, both for employers and for employees.
We are also concerned that not enough has been done to calculate the cost of collecting tax in Wales. Again, we would like to probe further in Committee the indexation aspects of the impact of income tax changes to Wales. It is essential to underline the fact that Labour has a clear triple-lock system, upon which we would insist before embarking upon income tax devolution for Wales. First, there is of course a need to ensure a fair funding mechanism for Wales. Even with the Bill’s proposed devolved tax arrangements, 75% to 80% of the Welsh government budget will still be provided through the Barnett formula. We need to be sure that we are not locked into the current funding system, which would disadvantage the country for ever. Secondly, we would insist upon a period of assignment to ensure that Wales is not worse off as a result of any tax-varying powers. Thirdly, of course, none of this will happen unless the Welsh people vote for tax-raising powers for the Assembly. Having seen the lamentable turnouts for the European and police commissioner elections, and with the idea of a campaign on a question containing the word “tax”, I would not be volunteering to lead a referendum to promote this in Wales.
Other aspects of the Bill are also important. In the parts relating to electoral systems and frequency of elections, our principal position is that these should be matters for the Welsh Assembly to decide. The public are confused by a system which allows a candidate to stand on both the constituency ballot paper and the regional list ballot paper. Labour will be submitting an amendment to protect the status quo. The Explanatory Notes make clear that the measure will benefit small parties with a smaller pool of candidates, so there is undoubtedly a highly political angle to this, as there is to much of the Bill; my noble friend Lady Gale, who will be helping me out on the Bill, will elaborate on this point later.
We also believe that a shift to the “reserved powers” model of governance should be introduced at the earliest opportunity. We should not wait for Silk 2 to be implemented in a further Bill, but should address this issue now. Once again, the coalition Government have questioned the authority of the Welsh Government to make decisions in certain areas and, once again, recently, the Supreme Court has found in favour of the Welsh Government, ensuring that the Welsh Government have the right to protect vulnerable farm workers. These are costly, bureaucratic fights, which should be halted as soon as possible. We shall be proposing an amendment to include the reserved powers model for the Assembly.
Extra powers would mean extra responsibility for Assembly Members, particularly in the role of scrutinising expenditure. Although this would obviously be a matter for the Assembly, ideally we need an assurance that the personnel infrastructure and the expertise, both in terms of administration and scrutiny, are in place before handing over these powers. Assembly Members are already extremely stretched with 60 Members and I am sure that some noble Lords will want to pick up on this issue during the debate.
Overall, the Labour Party will be supporting this Bill. However, we will take the opportunity to probe and test various aspects of the proposals which we feel need further thought and consideration.
Lord Thomas of Gresford (LD)
My Lords, this Bill is introduced into the House at a very interesting time, with the Scottish referendum only weeks away. It provides centrally for the introduction of tax powers specifically to permit the Welsh Government to set a rate of income tax, subject to their first obtaining a favourable referendum vote. This is what the First Minister, Carwyn Jones, said about that last November:
“As a Government, we are not pursuing the devolution of income tax, certainly not at this time. The reason for that is we believe that income tax devolution cannot come unless there is reform of the Barnett formula. The funding basis for Wales must be solid first, before we can consider whether income tax devolution will be appropriate and right for the people of Wales”.
I noted that the noble Baroness, Lady Morgan, a moment ago said that she would not lead the campaign for income tax devolution. That continues to be the Welsh Government’s position.
There is a bit of curious thinking in the Labour Party about this, because the Scottish Labour Party’s commission on devolution report explicitly and repeatedly rejects proposals for a needs-based alternative. In an interview on “Newsnight Scotland” on 18 March last, Labour’s Scottish Leader, Johann Lamont, claimed that:
“The Barnett formula works for the United Kingdom”,
which is very different from what was being said a moment ago. She said it works for the United Kingdom, not for Scotland. Well, Labour received its comeuppance in Scotland in the last Scottish Parliament election.
One of the problems—
Lord Richard (Lab)
The noble Lord provokes me slightly, since I chaired the commission on the Barnett formula in this House. Is the noble Lord in favour of the Barnett formula remaining in its present form for Wales? Is the Liberal Party in Wales seriously suggesting that the way in which the Barnett formula is calculated at present should remain in that state?
Lord Thomas of Gresford
The noble Lord knows perfectly well that the Liberal Democrats are for the reform of the Barnett formula and always have been. I can give that assurance. I am just puzzled to hear what is said by the Scottish Labour Party, which obviously prefers the current arrangements.
Lord Thomas of Gresford
The Scottish Liberal Party has been merged with the Scottish Liberal Democrats. I am not going to go any further into that.
The problem with devolution in Wales is that a Labour Government continuously in power—either on their own or as the lead party—escape accountability for their failures for a number of reasons. First and fundamentally, the essential link that all democratic Governments should have between raising resources through taxation and spending those resources on policies is missing. This Bill goes some way to dealing with that particular problem.
Labour’s demand for more money from the central government from a reform of the Barnett formula before they dare put these taxing powers to a referendum, is like Oliver Twist’s, “Please sir, can I have some more?”. It is Labour’s excuse for condemning Wales to fall behind in education and health, as it does, not merely judged by UK comparisons but also against international comparisons. Any very proper criticism of those failures is said to be “a war on Wales”—an empty piece of rhetoric first used by Carwyn Jones himself at the Welsh Labour Party conference in Llandudno in March.
Just as Labour seeks to delay the introduction of a Welsh income tax, so in the House of Commons debates on the Bill Labour sought to delay the introduction of the borrowing powers by waiting for a report on the legislative steps necessary to move to a model of reserved powers for the Welsh Assembly. I heard with interest the noble Baroness say that an amendment will be proposed to bring in reserved powers as the model in the Bill, and look forward to seeing how that is expressed.
The second matter that concerns me is that the recommendation of the Richard commission 10 years ago that the number of AMs should be increased to 80 to improve scrutiny within the Assembly was not pursued. The recommendations of the Silk 2 report, as the noble Lord will no doubt have noted, are that:
“A range of options should be considered in the short term for increasing the capacity within the existing National Assembly, including greater flexibility on the number and size of committees, increased numbers of research staff and better use of Assembly Members’ time. … The size of the National Assembly should be increased so that it can perform its scrutiny role better. The practical implications, and those for the electoral system, will need further consideration”.
The third matter that concerns me is that the press and media in Wales allow a dominant Labour Government to get away with it. Take the desire and the ability of the press in Westminster to tear Ministers limb from limb on a daily basis—for example the spat between Theresa May and Michael Gove over extremism in schools—and compare it with the deferential approach of the Welsh media over the very recent abject dismissal of Alun Davies, the former Welsh Government Natural Resources and Food Minister, for gross misconduct. One wonders whether the politicians and the Welsh media are too closely aligned and too ready to exchange roles.
I return to the Bill. I welcome the proposal to remove the current restrictions on individuals standing as a candidate for both a constituency seat and a regional seat. Studies by the Electoral Commission have shown that the current prohibition has a disproportionate impact on smaller parties, because they have a smaller pool of potential candidates from which to draw. The proposal to prohibit MPs from sitting as Assembly Members, and vice versa, is also welcome. It has an interesting history. Back in 1998, as the then Welsh spokesman for the Liberal Democrats I was lobbied from the very steps of the Throne by Mr Ron Davies Member of Parliament, the then Secretary of State for Wales, to give our party’s support to an amendment to the Government of Wales Bill which would permit him and others to have a dual mandate. At the time, it seemed reasonable to have some experienced politicians in the new body we were setting up, and so we agreed. However, I think that with the experience of the years that have passed it is time to end that practice.
I will raise another issue during the passage of the Bill. Much was made of the fact that two of the Lib Dem candidates in the last Assembly election were disqualified from being Members because they belonged to various public bodies, one of which was the Care Council for Wales. On the complaint of a Labour Party Member, they were interviewed by the police on an allegation that they had knowingly made a false statement in a document in which they gave their consent to being a regional party list candidate at those elections. That was translated into being disqualified from nomination.
The confusion arises because, under the Local Government Act 1972, a person is disqualified from being elected as a member of a local authority, whereas Sections 16 to 18 of the Government of Wales Act specifically say that:
“A person is disqualified from being an Assembly member”.
Of course, elections to local government are on the first past the post system; elections to the Welsh Assembly are done on both a constituency and regional basis. The regional election is in accordance with a party list. It is ludicrous to require a person on a list, who might not be first with a chance of election but second, third or fourth, to give up public service on a public body, very often unpaid, just to be a candidate. Although Liberal Democrat candidates were highlighted last time, I am aware that members of other parties stood as candidates, but were not elected, who might have been subjected to the same treatment. A successful candidate in an election ought to have a period in which to resign from any body that would disqualify him from being an Assembly Member—maybe eight days. I shall accordingly seek to amend Section 16 of the Government of Wales Act 2006 to make that position absolutely clear.
The aftermath of the Scottish referendum will, in all likelihood, see changes in Scotland. I was delighted to hear from the Minister that the situation in Wales will be revised; in particular, the lock-step will be looked at again. The structure of Welsh devolution is not yet satisfactorily settled. Once the Bill is passed as a further step, the focus in Wales will turn to the recommendations of Silk 2. The Liberal Democrats, who accept all its recommendations, will be here to return to the fray in the next Parliament. For the moment, I look forward to the fray in the Committee stage of the Bill.
Lord Wigley (PC)
My Lords, this is the third Wales Bill since the 1997 referendum. The second Silk report will no doubt require a fourth Bill and developments in Scotland, as we have just heard, may well trigger even further legislation. Indeed, I feel that the issues in the Bill are ones that I have lived with for most of my life. I was involved in the legislative processes in another place on the ill-fated Wales Bill 1977-78, as were a number of colleagues here today, on which the noble and learned Lord, Lord Morris of Aberavon, and my noble friend Lord Elystan-Morgan worked so very hard. Indeed, I was involved in the Wales Bill 1998, which became the basis of the National Assembly in the present settlement. Back in 1970, I also gave evidence to the Crowther commission, as it then was, which became the basis of the Kilbrandon report of 1973. I gave further evidence, as an elected Member of the National Assembly, to the Richard commission of 2003. That, of course, led to the 2006 Act, which will be amended by the Bill and was the basis of the 2011 referendum and the advanced settlement that we got subsequently. The issues and I go back a long way, and I have the scars to show for it.
I first want to thank, as an individual and on behalf of my party, Plaid Cymru, Paul Silk and his fellow commissioners for their hard work. I pay particular tribute not only to my colleague, Dr Eurfyl ap Gwilym, the Plaid Cymru representative on the Silk commission, but to the noble Lord, Lord Bourne, who, as the Conservative voice both on the commission and previously in the National Assembly, managed to bring his party to play a positive role in the new post-devolution Welsh politics.
The Silk commission’s efforts in coming to grips with an immensely complex subject—particularly in its first report, which is the basis for the Bill—deserve to be rewarded by the way we enact consequential legislation. Indeed, I believe that our starting point today should be to accept that the Silk commission worked very hard to reach a consensus involving much give and take, and that, as such, it presented a balanced report that should be accepted and taken forward as a package and not cherry-picked. I say that because all political parties had to compromise on their party programmes and a united, unanimous report was secured only on that basis. Naturally, my party, Plaid Cymru, would have liked to have gone very much further. We aspire to the maximum possible degree of independence for Wales within a framework of a united Europe with its free movement of people, goods and capital, which inevitably imposes some constraints on the degree of independence that any country has.
Unlike the Calman commission in Scotland, our Silk commission succeeded in getting all-party acceptance that there would have to be some compromise so as to get implemented at an early stage those changes that all parties saw as necessary in order to make the Assembly a more effective body and the Government of Wales more transparent and democratically answerable for their actions. That is why, even at this late stage in the Bill’s parliamentary journey, I urge that we look at whether we can implement the entirety of the Silk package. In that regard, I noted the point made by the noble Baroness, Lady Randerson.
Since the publication of the Bill, the Silk commission has brought forward its second report on the legislative powers to strengthen Wales, and in some ways it is difficult to differentiate between the two. Indeed, some have suggested that the reports are in the wrong order. An old saying that I found very apposite in the world of industry as much as in the world of government is that “form follows function”. The function of the National Assembly is dependent on the model of devolution—it would be somewhat different if Wales had a reserve-powers model such as that of Scotland and Northern Ireland—and inevitably that impacts on the transparency and accountability of the Assembly. The range of devolved portfolios will dictate the size of the budget, and the nature of those portfolios and the extent to which they lend themselves to policy variation in Wales compared with England will dictate the degree of budget flexibility that is needed. In addition, the degree of responsibility deemed appropriate for a Welsh Executive in largely non-legislative matters, such as economic stimulus management, will determine the balance between capital and revenue responsibilities.
I have deliberately tried to set my remarks in the context that I have for the very reason that we must formulate the financial powers needed to strengthen Wales with regard to the responsibilities of providing adequate enabling resources and ensuring proper answerability. In order to deliver the legislative, executive and administrative agenda that the Welsh Government will have as their responsibility, they need to be clear about the powers that they have. That of course is the agenda that the Welsh people expect to be arranged for their needs and expectations to be answered.
I believe that we shall have to make certain assumptions with regard to those non-financial matters as a basis on which we can reach meaningful conclusions regarding finance and the adequacy of the Bill. For example, the linkage between the budget and expenditure, and hence the resources needed, and the democratic need for the Government’s performance to be judged by the electorate requires both financial transparency and resource flexibility. I shall give a concrete example. If the NHS in England were privatised, as some politicians on the right advocate, and if the Welsh Government, having full legislative responsibility for the NHS in Wales, wanted to follow a different path, they would have to have a significantly different financial and fiscal freedom from the one they have at present for that to be a meaningful policy option.
I turn to some specific aspects of the Bill that will no doubt warrant our attention in Committee. In Part 1, I certainly welcome the removal of the restriction on dual candidacy and a return to the original settlement of the 1998 Act. It was, quite frankly, a piece of naked party-political jiggery-pokery by the Labour Government to have removed it, and they should be ashamed of themselves for having tinkered with the constitution for party-political advantage. I hope that we can have an assurance from the Labour Front Bench that never again will they resort to such unworthy action. If that assurance is not forthcoming, we should build into this Act a provision that any further change to the electoral system of the Assembly should be implemented at Westminster, if indeed it has to be done at Westminster, only if it carries a two-thirds endorsement by Assembly Members.
With regard to the Assembly’s election and membership, I am totally convinced that the Assembly cannot do an effective job with its new, enhanced powers since the 2011 referendum without a larger membership. That becomes an even greater requirement with the additional financial scrutiny that will emanate from the Bill. I believe that there need to be at least 100 Members to do an adequate job. Might I suggest that if we are not to have an STV model of election, which I favour, we should consider each of the current 40 Assembly constituencies having two Members for each seat, with one man and one woman elected in each, thereby largely overcoming the question of gender balance that has been a problem for some parties over the last few years? Primarily I believe that this is something that the Assembly itself might consider as any such initiative should come from Wales and not be imposed by Westminster. I hope that the Government might be amenable to giving the Assembly full powers over the electoral system.
I am, incidentally, aware that in the Commons Report stage, Labour proposed taking steps towards a reserve powers model, to which the noble Baroness, Lady Morgan, referred earlier, and I heartily endorse that. But inexplicably, it linked this to a delay in implementing Part 2 taxation powers, which I could not understand. I hope that when this matter comes to Committee we shall be able to consider the pressing need for Wales to have a Parliament based on the same reserve powers as underpins the Scottish Parliament and the Northern Ireland Assembly, without unnecessarily linking it to delaying the taxation powers.
With regard to the taxation powers in Part 2 of the Bill, they are very modest indeed—so much so that I personally had some doubt about whether they warranted a referendum. However, I accept that that was part of the Silk recommendation. In the spirit of accepting Silk as a package, and not cherry picking, I accept that that referendum may be necessary. But, for every small change in relation to the government of Wales, we cannot have referendum after referendum. The House of Commons is elected and this Chamber is appointed to do a job of work, and we have to take that responsibility. In that spirit I urge the Government to reconsider their rejection of the Silk proposal on tax rates being varied in each band, to which reference has already been made and signals given that we are moving in the right direction.
The Government’s insistence on having a straitjacket of lock-step provision in the Bill undermines, at a stroke, the flexibility of the Welsh Government to use the new tax-varying powers in a radical fashion. They could not, for example, reduce the top rate by 5p, say, to make Wales a more entrepreneurial-friendly place, at a modest cost in terms of forgone income without reducing the standard rate proportionately—a totally impossible and unsustainable action. The irony, as I have no doubt the government Front Bench are very much aware, is that in Scotland, where the Calman commission insisted, I believe, in having a lock-step model, the Government in their move towards a devo-max situation as part of buying off the yes vote in the Scottish referendum are now talking about scrapping the lock-step, as recommended by the Strathclyde commission, and indeed personally endorsed by the Prime Minister. I am grateful to the Minister for indicating that the Government will indeed look again at this, and there may be a possibility of doing something about it in Committee or on Report.
I welcome the provisions of new Section 116C to be inserted in the Wales Act, allowing new devolved taxes. Some work needs to be done in the Assembly to see how that can best be used. I shall now say a word about the workings of the borrowing powers, which appear in Clauses 20 and 21 of the Bill. I understand that until a further referendum is held the Assembly’s borrowing powers will be capped at £500 million, which frankly is chickenfeed, and totally inadequate to deal with Wales’s economic problems. This is insufficient even to fund the M4 improvements around Newport, which will cost more than £900 million.
Will the remainder of that capital have to be funded from the already truncated capital budget of the National Assembly, leaving virtually nothing for any other capital projects—hospitals, schools, roads, sea defences—needed around the rest of Wales? It seems, quite frankly, as if the Welsh Government’s hands are being tied by Westminster in order to deliver London’s objectives and priorities, not the balanced capital programme needed by Wales. The Assembly should have an accumulated borrowing capacity of £2 billion over and above the M4 costs and we should address that question in Committee.
I have dealt with what is included in the Bill but I cannot let it pass without noting what is not included. In its introduction, on page 3, the Silk report comments that:
“Consideration of the Holtham Commission’s proposals for funding reform in Wales … was excluded from our terms of reference. These issues are being taken forward through a separate bilateral process between the UK and Welsh Governments”.
That is the elephant which cannot speak its name in today’s debate but whose shadow makes a sham of pretending that this Bill deals with the central financial question facing the Welsh Government—that is, the persistent, chronic underfunding as a result of the mindless, myopic adherence to an outdated and discredited Barnett formula, which has left Wales, since 1999, with a cumulative shortfall of £6 billion in its finances. This has led to the underfunding of the NHS, schools and local government in Wales, and neither party of government has had the courage to put that right.
In recommendation 12, Silk stated that if the UK Government were to agree to devolve corporation tax to both Scotland and Northern Ireland, the same powers should be given to Wales. Will the Minister confirm that if corporation tax is indeed devolved to Scotland, it will also be devolved to Wales? If so, why is there no order-making mechanism within the Bill to avoid having to get yet further primary legislation to handle the matter?
The real inadequacy of the Bill will become glaringly obvious after Scotland’s independence referendum in September. If Scotland votes yes—as I and my party hope—the relationships of the residual United Kingdom will have to be fundamentally reassessed. Even if Scotland votes no, partly as a result of the blandishments offered by the parties in Scotland to head off a potential yes vote, those commitments will need to be incorporated into the election manifestos of the UK parties, otherwise we could well see a bitter backlash in Scotland, with perhaps 20 or 30 SNP MPs holding the balance in the new Parliament.
That has a significant implication for Wales and for the adequacy of this Bill. The Bill we are debating today may well be seen, by the time we get to Committee, as a vehicle that must grow into an enabling Act relevant to the post-referendum world we shall then inhabit. It is in that context that I support a Second Reading.
Lord Morris of Aberavon (Lab)
My Lords, I welcome the Bill as a major step forward in the long-running saga of the principle of giving more power to the people of Wales, where it rightly belongs. Depending on the length of this debate, I apologise in advance if I miss one or two speeches as I have to preside at an event of interest to Welsh lawyers at the Supreme Court, regrettably clashing with the change of date for this debate.
We have come a long way since I introduced the Wales Bill in the Commons in November 1977—I thank the noble Lord, Lord Wigley, for his reference to it—and longer still since the 1950s, when I discussed Jim Griffiths’ remit to Lord Prys-Davies to put on paper a model for an elected council for Wales, the first practical step, a foundation, upon which we developed as a party and delivered—indeed, the only party that can deliver at Westminster.
In 1974 my party was split. We had not sufficiently prepared Wales for the momentous task of choosing the way forward in a referendum. In the past, the Conservative Party has fought resolutely against giving any power to Wales, from the setting up of even a Secretary of State’s office. The last Secretary of State kept a very low profile on the Prime Minister’s last visit to Cardiff. Not a few years ago, he was advocating in the Assembly that no taxation powers should be given. I surmise that the change of heart of many Conservatives in Cardiff owes a great deal to the noble Lord, Lord Bourne of Aberystwyth. I thank him and his fellow commissioners on the Silk commission. We are all devolutionists now: or, should I say, mostly all?
In 1998, Lord Callaghan told this House,
“that the age of small nations has arisen as a kind of backlash to what is happening globally”.—[Official Report, 21/4/98; col. 1056.]
I wish the new Secretary of State well, despite the Prime Minister’s inflammatory comments at the Royal Welsh Show yesterday. I just missed him, as it happens. The Secretary of State’s first task, when he sits down during the recess, is to find ways of bringing the war of words between Westminster and Cardiff to an end and, despite the approaching 2015 election, find ways of working with the First Minister for the better governance of Wales. The Prime Minister is not encumbered by past battles and should have shown leadership and a way forward. We all have to deliver on our priorities. Sometimes they can be right and sometimes they can be wrong or improved upon. Given the problem on both sides of Offa’s Dyke, the administration of health and education cannot be perfect in today’s conditions. If there were no problems with the health service in England, which we read about, day after day, week after week, perhaps it would be allowable for the pot to call the kettle black. However, this is not so and there are problems on both sides of Offa’s Dyke. The more we learn from each other, the better. The whole idea of devolution is that we can be different and learn from each other. From plastic bags, at the bottom end of the scale, to experimenting in a small way with administering the health service, Wales can learn from England and vice versa.
It is interesting that the 2015 general election will be fought, in Wales, on matters not within the province of Westminster MPs. I was aghast when a Welsh Assembly Member is reputed to have said that it was constitutionally inappropriate for a Welsh MP to give evidence to an Assembly committee on a devolved matter. I gather that my right honourable friend Ann Clwyd has now given evidence. Likewise, a Welsh Minister is reputed to have refused to give evidence to a Commons Select Committee. I have consulted the Clerk of this House and the contention of inappropriate behaviour is without any foundation. The sooner we learn that Wales and England are interdependent, not independent, the better. Only two years ago, I travelled to Cardiff, at the invitation of an Assembly committee, to give evidence. Since then, I have received another invitation. I am pleased that the thrust of most of my earlier evidence was accepted and I am delighted at the proposal to grant modest borrowing powers to the Assembly. Perhaps the noble Lord, Lord Rowe-Beddoe, can remind us what the borrowing powers of the WDA—which I created—were. He will be able to say better than I but, looking at it as a whole, they are modest. I congratulate the Assembly Government, and their most effective Business Minister, on being decisive in their proposal to use some of those borrowing powers to invest in better communications around Newport. We all suffer from being held up by the problem there: I do so week in, week out.
When I became Secretary of State, not a spade was being dug to further the M4. I maintain my firm belief that the secret of Wales’s prosperity is good east to west communications. I spent many long hours—including once on a long business trip to Japan—expediting the planning process for the A55 in north Wales. In that time, I agreed the line of the road but, unfortunately, I had to defer the problem of Conwy because of the lack of evidence on the practicality of a tunnel. Eventually, the evidence was forthcoming and my successors—I congratulate them—built the A55. Good east to west communications in south Wales and north Wales are crucial. If the Newport bottleneck is tackled, other problems will be seen and dealt with in north Wales. It is a matter of availability of resources and I firmly believe that this is the way forward. This is why, in my time, I rejected grandiose economic plans for the whole of Wales. In the north, there would be very little interest in what was being done in the south and vice versa. What was important was communicating with the markets in England.
I am less enthusiastic about the detail of taxing powers in the Bill. My bottom line is that, whatever taxes the Welsh Assembly raises—at its peril—Wales must not lose out in any Treasury subvention. Taxation does go with representation, so there is a lot going for the principle, but the end result must be clear and untrammelled by unnecessary restrictions. However, it should follow and not precede reform of the Barnett formula. I was there on day one when the noble Lord, Lord Barnett, on the back of an envelope, conceived the idea of the share of the money I should have. It was never intended to be a formula and it has never worked as a just way of allocating resources. Governments —particularly my own, I fear—did not attempt the reform. I ask, rhetorically, whether this was because Scotland was gaining so much more from it than Wales was. It should have been reformed years ago. Whatever Government are in power after 2015, it is essential that that is tackled now.
Before I close, I will make one fundamentally important point, which has already been referred to. The Bill’s weakness is that it is yet another manifestation of a drip-by-drip granting of new powers to Wales. Surely there is a better way of utilising parliamentary time, despite what the Minister has said. The time has come for the adoption for Wales of something similar to the original Scottish model of the transfer of all powers, save those that are reserved to Westminster, with further consideration to the Scottish position after the referendum. The constitutional position would be clear and the boundaries of powers would not need updating every few years. It would avoid the Attorney-General marching, metaphorically, up and down Offa’s Dyke, acting as a policeman to ensure that the Welsh Assembly did not exceed its powers, a role which I created in 1977. The last Attorney-General was trigger-happy and only last week came unstuck before the Supreme Court. His intervention seemed to lack an understanding of the purpose of the granting of a particular power and that is where he went wrong.
After we have examined the mechanics of the Bill, which should pass, we should, after 2015, concentrate on the granting of a settlement based on the reserved powers model. I cannot emphasise that too much. The next Government should then set up a constitutional convention, a body with a membership even superior to and with more clout than the Kilbrandon commission, the genesis of Scottish and Welsh devolution—perhaps party leaders might even serve on it—to examine the sheer unevenness of the constitutional arrangements for Scotland, Wales and Northern Ireland, how devolution is still largely unrecognised and ignored in the workings of Westminster, and the future roles of both Houses of Parliament for the devolved assemblies.
Lord Bourne of Aberystwyth (Con)
My Lords, it is a great privilege to follow the noble and learned Lord, who has unparalleled experience in these matters. I found myself in agreement with much of what he said. I also join the noble Baroness, Lady Morgan, in saying that it was a great pleasure to see the Secretary of State here for the beginning of the debate. It signals a close working relationship with us and indeed with the Welsh Government in Cardiff, perhaps underlined by the fact that he attended the First Minister’s reception yesterday. I think that is a sign of things to come. I do not think that the jury is out: I think it is going to be a good, close working relationship.
The Bill is in three parts. I do not propose to deal with one part for very long, except to say that it deals with the housing revenue account debt. I do not think anybody else has dealt with that either. It is largely non-controversial. I will first say a few words about Part 1, which deals with matters that were not at all within the purview of the Silk commission—namely, electoral arrangements. First, moving to a five-year fixed term now that the UK Parliament is on a fixed term makes a lot of sense. The party leaders and indeed the parties in the National Assembly welcomed it and we should as well. The ending of the dual mandate with the House of Commons also makes sense. There are some transitional measures there for people who move from one body to another so that they are not automatically disqualified from the other body. Once again, these are sensible.
What seems to be controversial, at least with the Labour Party, is the return to the process that the Labour Party introduced, which it now says people find confusing, of allowing people to stand both on a regional list and for first past the post constituencies. I would like to see the evidence that the people of Wales are confused by that. I do not have such a low opinion of the intelligence of the people of my country as to believe that. There is no evidence to suggest that anybody is confused by that. It is perhaps even more insulting that the Labour Party did not seem to think that the people of Scotland were confused by that because, at the same time as the Labour Government were changing it for Wales, they kept it for Scotland, where of course they had regional Members. When they changed it in Wales, they did not have any regional Members. If it were not the noble Baroness putting this forward, it would smack of hypocrisy, but I know her well enough to know that the opposition that she is putting forward is probably tongue-in-cheek. It makes sense to permit this and allow people to vote as they wish to vote.
Turning to the part of the Bill relating to Silk Part I, the taxation and borrowing powers are largely but not exclusively an adoption of Part I of the Silk report. I welcome what the noble Lord, Lord Wigley, said about the consensual nature of that. I particularly commend him for the lead that he has always taken in Plaid Cymru, and that Eurfyl ap Gwilym took as the representative of Plaid Cymru, in ensuring that we developed a consensus. It was not perhaps as difficult as he has suggested. I well remember that in Scotland Eurfyl ap Gwilym was mistaken for the Conservative representative because he was far to the right of me on many economic policies when we met the trade unions. It is sometimes surprising how these things develop. It is also important to note that the Labour Party was represented on Part I by a much respected and very able former Finance Minister, Sue Essex, who worked extremely hard, as did Rob Humphreys for the Liberal Democrats. The consensus building on Part I and indeed Part II was not that difficult. If we are able to capture that same capacity to move forward together within this House and the House of Commons, that will be all to the good.
Looking at the various taxes that are dealt with in the Bill and were dealt with by Silk Part I, the proposals on landfill taxes have been accepted, as have those on stamp duty land tax. The difficulties on aggregates tax were largely to do with the European position, and when we recommended devolution of that we put in the caveat, “Subject to this being solved in relation to European constraints”. We recommended that air passenger duty should be devolved for non-stop or direct long-haul flights. I regret that that has not been the case. I anticipate that the noble Lord, Lord Rowe-Beddoe, will deal with that when he speaks. I am disappointed in that regard.
The other difference is on income tax—not with the proposals on the bands so much as the lock-step. The amount on the bands is the same but we recommended the scrapping of the lock-step, which I thought was a good thing. Of course, there is lock-step in Scotland and we have to see that at the moment everything is looked at through the prism of Scotland, as noble Lords have said. It may look very different after the Scottish referendum, as my noble friend the Minister suggested. I do not agree but I can understand the Government’s position on that.
In relation to borrowing, I suppose we would all want more borrowing for Wales but we should note that this is a significant step. It goes further than what the Labour Party achieved in its period in government. For all the complaining about lack of progress on the Barnett reform—I wish the noble and learned Lord had grabbed that envelope and torn it up when it was being scribbled on in front of him; it might have saved us all a lot of trouble—and the gnashing of teeth on the other side, no progress was made on reform of the Barnett formula while Labour was in government. To be fair, I think the present Finance Minister in the National Assembly, Jane Hutt, has acknowledged that; in discussions with my right honourable friend Danny Alexander they have made progress on reform of the Barnett formula, although clearly there is still some distance to go on that.
I note what the noble Baroness, Lady Morgan, said about not leading the campaign for income tax powers in Wales. I must say, since she seems to regard those powers as pretty much akin to killing blue-eyed babies, we should be grateful that she is not going to be leading that campaign because, on the basis of her speech today, I do not think she would convince many people. But this gives power to the people of Wales, for us to do things differently based on having some independent tax-raising powers—new taxes, as the noble Lord, Lord Wigley, mentioned. These are things that we should be seizing.
Yes, there are some deficiencies in the Bill but it is a massive stride forward and we should acknowledge that and try to move forward in the spirit of consensus, as we have done so far on these issues, in marked contrast to Scotland. No doubt the position will look different after the Scottish referendum, but that does not mean that we should not grab this opportunity and move forward because otherwise we will get left even further behind. On that basis, the Bill deserves our support and then close scrutiny in Committee.
Baroness Humphreys (LD)
My Lords, I add my voice to those who have welcomed the provisions in the Bill. In doing so, I pay tribute to the contributions of my Liberal Democrat colleagues, in both Cardiff Bay and Westminster, who insisted on the inclusion of a commission to examine the devolution settlement in Wales in the coalition agreement. Their foresight has resulted in this opportunity to strengthen the constitutional arrangements for the National Assembly for Wales.
When the National Assembly opened in 1999, the limited powers and responsibilities it was given resulted in it being labelled a talking shop, and I would probably be correct in saying that many of us who were there at the time would agree with that description. I was certainly struck in those early days by the difference between the Welsh and Scottish constitutional settlements as I sat in the Scottish Parliament and, with a great degree of envy, watched MSPs debate a piece of primary legislation to create the first national park in Scotland.
Thankfully, the situation in Wales has moved on, and whether we agree with some of the decisions of the Welsh Government or not, it is absolutely our responsibility as we debate this Bill to distinguish between the Labour Government in Cardiff on the one hand, and the institution which is the Senedd on the other, and to ensure that its constitutional framework allows the Senedd itself to carry out its functions properly.
This Bill has much in it that many will see as a sensible way forward—Members have already referred to them—including: the change to a five-year term in the Senedd to avoid clashes with parliamentary elections; the banning of double jobbing, where Assembly Members retain their seats in the Senedd if they become MPs and vice versa; and the renaming of the Welsh Assembly Government as the Welsh Government—clearly focusing on the difference between the Government of the day and the institution itself. All of those are to be welcomed.
The issue of dual candidacy will, of course, engender debate and I look forward to contributing to that debate as the Bill progresses through this House. Perhaps it will be enough to comment, at this stage, that no other democratic country that operates an additional member system as a means of achieving a proportional result has placed a ban on dual candidacy. That Wales remains in the same category as South Korea, Taiwan, Thailand and Ukraine—surely not the best examples of democracy at work—casts a shadow on the fairness of the system underpinning our Senedd. Critics of the ban on dual candidacy have observed that:
“The biggest single public concern about the operation of the Assembly is a concern about the calibre and life experience of Assembly Members. Dual candidacy does at least help all parties to secure the election of their best people”.
Debates at future stages of this Bill may also present us with the opportunity to address the issue of closed lists for the regional aspect of elections, introduced by the party opposite when it was in government and operational in the 2011 Assembly elections. Reversing this situation and reintroducing an open list, where names of candidates as well as parties appear on the ballot paper, would re-establish that link between lead candidates and their electorates.
I said earlier that this Bill will ensure the framework to allow the Senedd to properly carry out its functions, but I wonder whether it goes far enough. This Bill does not deal with aspects of Silk 2 which many would argue we should take the opportunity to include. The new fiscal powers envisaged for Wales—the design and arrangements for schemes to collect stamp duty tax and landfill tax, for example—present the Welsh Government and the Senedd itself with many challenges.
The other elephant in the room is, of course, the size of the Assembly. In its publication, Size Matters, the Electoral Reform Society argues that the size of the Assembly is a matter which is,
“too important to be left to the politicians”,
but it is surely we, as politicians, who will have to make the final decision. There is a need to open the debate on the issue and examine the arguments in a logical and unbiased way, with the goal of strengthening the effectiveness of the institution that is the Assembly.
With 60 Members at present, the Assembly is smaller than almost half the unitary authorities in Wales. In the years leading up to the formation of the Assembly, none of the recommendations about its size fell below 75, with most recommending 100. With an Executive of 12, the remaining Assembly Members already experience difficulties fulfilling an effective scrutiny role alongside their other duties and their workload is heavier than that of Members in Westminster, Holyrood and Stormont. Perhaps the assertion made by the Electoral Reform Society that good scrutiny saves money is one worthy of debate in this Chamber. But these are issues for another time—perhaps even in the next stages in this Bill.
The Bill before us today seeks to strengthen the constitutional arrangements for the National Assembly for Wales and to introduce a new funding framework which will empower and enhance its accountability. Perhaps it is pertinent to remember that these recommendations are not the result of some political dogma but come from, and are underpinned by, the recommendations of a commission that consulted with the people of Wales—a theme to which I will undoubtedly return in future stages of this Bill.
Lord Morgan (Lab)
My Lords, perhaps I should declare an interest as a member of the King’s College group which has produced a plan for a written constitution, currently being considered by the House of Commons constitutional committee. I cannot, I am afraid, declare an interest in the House of Lords Constitution Committee because I have been kept off it.
I therefore speak from the Back Benches with the independence that that conveys, and do so by giving the Bill my very strong general support. As has been pointed out by other speakers, it is a remarkable change for the Conservative Party, which opposed devolution and primary legislative powers, and the former Secretary of State, who spoke against the Assembly having taxing powers. So when the Prime Minister in Cardiff recently declared that this is a Government who believe in Welsh devolution, that was a very remarkable conversion worthy of events on the road to Damascus a long time ago.
This Bill has many excellent features from the small—like the name of the Assembly Government—to implementing the bulk of the first report of the Silk commission on taxation. One concludes that we have a coalition Government of repentant sinners—who, we are told in the good book, have a better than even chance of entering the kingdom of heaven.
I want to say something briefly about the Assembly and its character and a little about the policy it should pursue. I pray in aid not a Welshman but a Scotsman, Gordon Brown, whose contribution to the Scottish independence debate has been outstanding, and who has many important things to say in his latest book on the constitution more generally.
It is clearly important that the powers of the Assembly should be revised. It was a big conceptual mistake that the Welsh Assembly did not have reserved powers from the very beginning. It had the drip-drip of conferred powers. No intelligent reason was given why this should not be done as it was in Scotland. I do not think, with respect, that any intelligent reason has been given this afternoon. It seems to me that it is bound to happen as part of the wider constitutional changes which the noble Lord, Lord Wigley, has said will follow the Scottish referendum whatever the outcome is. As the Silk report has said, it would make matters clearer and make for greater coherence and consistency. It would also bring out the meaning of what devolution actually is. It is really rather humiliating to have powers determined for you by another assembly. I think that this would strengthen the Assembly, and would make the Welsh Assembly as Gordon Brown would wish to see the Scottish Parliament—namely an entrenched, permanent part of an updated constitution, and an updated written constitution, I hope. I hope to see that and, as people have said, for that to be treated as a matter of urgency.
On the size of the Assembly, I agree with the noble Baroness, Lady Humphreys, that 60 Members is nowhere near enough. The Richard commission argued strongly for it. This is a very small number of Assembly Members who are not in the Government to carry out the processes of scrutiny. I remember raising this with the previous Secretary of State but one and inquiring why the Welsh Assembly did not have more powers. She observed that the public mood did not favour having more paid officials. I recall asking her why in that case the Government had suggested creating 300 more paid politicians in the upper House, but there was not a response to that.
I think that the length of the Assembly should be determined by the Assembly; it should not be told by another body for how long it should conduct its operations. As a responsible and dignified body, it should decide for itself.
On the policy changes, much has been said about the borrowing powers. That is the central feature of the Bill and will enable the Welsh Government, or should enable them, to take on far greater powers to improve the economy and infrastructure in Wales. The borrowing amount of £500 million is, as was said, far too timid—I think that “chicken feed” was the expression that I heard on my left, which seems rather accurate. It is based on a measurement which is different from that of Scotland. There is nothing divinely created about it and I am sure that it will be looked at. It is profoundly necessary after the public sector cuts that Wales has endured in the past four years that it should have the ability to expand through its borrowing powers. There is a stronger case now for greater borrowing powers because the Welsh Assembly is to have much greater powers and to be able to do more things. Silk has virtually argued that the same measurement should be used for Wales as for Scotland and I do not see why that should not be the case.
I welcome the thrust of the Bill on taxation. As we said in the debate on the Scotland Bill, there should be no representation without taxation. We now have powers for stamp and landfill duties, which will give the Welsh Government more of an independent income. On income tax, I would hope that the Labour Party, of which I am a member, would be less apprehensive. It was noted in the New Statesman a week or two back by Professor Adam Tomkins that the Labour Party had lost out in the debate on Scotland by being too timid and, having set up devolution, not spelling out what it was for. I hope that the Labour Party, which is, as it has always been, the dominant party in Wales—or has been since the First World War at least—would be less apprehensive about that. One can see the apprehension about tax competition and about the Treasury using income tax variations for its own purposes, but this is a matter on which the parties should be quite clear—for that matter, I support what the Labour Party has said about perhaps increasing to 15 pence the amount of income tax that could be devolved to Wales.
I do not think that we need a referendum. We have had quite enough referendums in Wales. The noble Baroness, Lady Morgan, showed proper apprehension at leading or even taking part in any such debate—it would be one of the lower turnouts on record. Politicians of both sides have been passing the buck on this one. There was no referendum in relation to the Calman proposals for Scotland. Why should there be for Wales? It is a humiliating cop-out—to use the vocabulary—which is unfair.
Lord Bourne of Aberystwyth
There was of course a referendum in Scotland which the Labour Party provided for when devolved taxation was introduced.
Lord Morgan
Yes, I accept that. At any rate, in this case, I think that the argument against a referendum in the Silk commission report is profoundly the case and I strongly support it.
What I think is quite wrong, however, is to have income tax devolved at all while the Barnett formula continues. The formula was shredded by the Holtham report; it was shredded by the House of Lords committee. I do not know whether a stop-gap can be well past its sell-by date but—if those metaphors are in any sense reconcilable—that is the main point that has come forward. We have had a conspiracy of silence on all sides about the Barnett formula. The Labour Party had one or two debates on it in this House which were not at all sensible. The Conservatives have had their own discussion which quite falsely linked the Barnett formula with the accumulation of national debt, which it has nothing to do with. The Liberal Democrats have not been particularly vocal on it. Plaid Cymru has attached the Barnett formula to an extreme version of Welsh nationalism not particularly favoured since the days of Owain Glyndwr. UKIP has attached it to English nationalism, which seems to be equally unfortunate. In a way, the “none of the above” candidate would have a strong vote from me in that debate.
Proper government in Wales has been a long and hesitant process. It began in perhaps unlikely fashion with the demon drink in 1881, when the Sunday Closing (Wales) Act began the principle of Welsh legislation. This Bill is a welcome milestone, but it needs a wider vision linking the arguments in Wales both with the important and highly relevant debates on independence in Scotland and with the forthcoming debate on a referendum for Europe, which may not come for two or three years but will most certainly affect the attitude of Welsh people towards devolution and towards participating in a United Kingdom where England is perhaps strongly Eurosceptic. Hence, Gordon Brown has urged that a new constitutional settlement be adopted to bring together all these different themes and to make, as I have suggested, the Scottish Parliament and the Welsh Assembly permanent and irreversible.
This Bill shows how Wales has been a casualty of the process of stop-start change that we have had on constitutional reform for many years. The constitution has been correctly described by Professor Anthony King of the University of Essex as a “mess”. Wales is one area that has suffered from this mess. I would hope therefore that the mess could be cleared up by having a constitutional convention to provide a holistic look at all these aspects: the union in this country; the union with Europe; and the relationship between the different nations within the United Kingdom. I hope that we will have a vision supplied—perhaps even by the Constitution Committee here, of which I shall not be a member—and that the people of Wales will benefit. Nevertheless, that this Bill is a very helpful and hopeful start is incontestable.
Lord Elystan-Morgan (CB)
My Lords, this Bill well deserves the support that is obvious for it in all parts of the House, in the main because it is a Bill that takes Wales further along the road to home rule.
Many Members have meandered down memory lane in connection with the events of past decades. They reminded me of the feelings that I have, and always have had since I was a young boy, about the attainment of a Welsh Parliament. It has been something of an obsession for me, and I make no apology for that. For many years—years of disappointment and frustration—it seemed like a distant dream, which would probably never be achieved.
All that changed in 1964, with the establishment of the office of Secretary of State for Wales. Before then it seemed that nothing in the way of substantial constitutional development was possible: after that, everything has been possible—that is, in so far as it is the will and the determination of the Welsh people to achieve it.
To some extent, the devolution in the 1997 referendum, and in statute thereafter, was not classic devolution at all, because it did not, in the main, entail the transfer of any substantial new powers to Wales. The powers had already been transferred, but they had been transferred to Welsh Ministers. What it did bring about, of course, was a significant transfer of power from Ministers to the people of Wales. It meant that, for the first time, one had a body elected by the people of Wales, meeting on the soil of Wales, and with a moral and legal authority to speak for Wales. Obviously, with the greatest respect, that authority had to be on a broader basis than that which could be enjoyed by any Minister of the Crown as such.
In the referendum of 2011 we had a very considerable devolution. That created, essentially, a Welsh Parliament —a lawmaking Parliament with wide legislative powers, falling into 20 separate broad categories. That presents a massive challenge. This Parliament of Westminster has had many centuries to evolve slowly, deliberately and securely, and to mould its traditions to meet the needs of various ages. We in Wales will be expected to achieve a great deal of that process within a very short compass of time.
That must always be remembered in the context of what is now a new body. It is the Assembly, but it is essentially a Welsh Parliament. I not only recognise, but am charmed by the fact, that it should be called the Senedd. I believe that it was the noble and learned Lord, Lord Morris, who set the precedent with his Bill in the 1970s, in which the name of the body was the Senedd.
Lord Thomas of Gresford
My Lords, I know that the Bill presented by Lord Hooson in 1967 contained the name Senedd; I drafted it.
Lord Elystan-Morgan
It did indeed. A few weeks ago I had the great honour of contributing a chapter on the political life of the late Emlyn Hooson, in which I made that very point.
There is therefore a respectable precedent for the concept of a Senedd. The word may, of course, have embarrassing connotations. As noble Lords will know, it comes from the Latin word “senex”, meaning an old man. The same stem is in the word “senile”—and also in the word “senior”. But—and I speak with some fervour and commitment in this matter—there is a great deal to be said for old men in politics.
The generality of the Bill is very much in the track of everything that has happened in the past 40 years, and especially in the past 17 years, since the referendum of 1997. I have little doubt that it shows that the curve of expectations and the curve of confidence that the Welsh people have in their own destiny has nobly sharpened during that time. I think that it will continue to do so.
It is in that context, therefore, that we look not only at what the Bill contains, but at what it does not mention. The main part of it, as we all appreciate, deals with the varied rate of tax that will be within the jurisdiction of the Welsh Assembly. I have a canny approach to such a situation, perhaps because I am a Cardiganshire man, and in Cardiganshire we have the tradition of being extremely careful in relation to money—a very laudable trait, if I may say so.
Of course the proposal has its attractions. Of course we will never be a complete and full home rule parliament unless we take up such responsibilities. But after all, we are being asked to invest in a future that is very uncertain. We are being asked to buy stock, as it were, in a new enterprise—but the prospectus is very nebulous. What do I mean by that? I refer, first, to the lock-step. That could dominate the whole situation. With a lock-step imposed on the three bands of taxation, it might be difficult to impose a progressive tax. The Silk commission—I too applaud the efforts of people like the noble Lord, Lord Bourne, in this context—was strongly for that. It argued the case to the point where there was no answer to it. Nevertheless—due, no doubt, to influences from beyond the Tweed, and for reasons connected with Scotland—there is dubiety at this moment. Until that dubiety is resolved, we cannot really begin to think about the question of whether Wales should take up these powers.
There is also the question of Barnett. In passing, may I say that we hope that the noble Lord, Lord Barnett, will soon be restored to full health in this place; he is a gentleman of remarkable qualities, and I have enjoyed his friendship for more than 40 years. However, the losses under the Barnett formula have been enormous, as the noble Lord, Lord Wigley, has already proved. The commission chaired by Gerry Holtham made it abundantly clear that every year, Wales loses—or did lose when the report was published, three years ago—some £300 million. As the economy improves, that loss becomes greater. It is a disgraceful situation, for which Governments of both colours over the past 30 years are responsible, because they have been unwilling to look into the inequity of the arrangement. A small country like Wales simply cannot afford this massive haemorrhaging of assets, which will continue unless something drastic and radical is done about it.
As for the main proposal in the Bill—yes, there are possibilities, but there are also dangers. There are matters that have to be spelt out. I cannot for a moment see the Welsh people accepting it until they have some sort of reasonable guarantee that we will be no worse off if we take up those options. Hazlitt said that there are only two certainties in life: death and taxes. As for death, this House may very well do something about its certainty, but as for taxes, they will remain exactly the same, and for ever.
Of course it will be difficult for a referendum to be carried if there is still a tinge of uncertainty. Gerry Holtham said to the Welsh Affairs Committee that the referendum is very losable unless those guarantees are in place.
I turn to two other matters that are not in the Bill. One is the membership of the Assembly. I do not think that I can overemphasise that feature. The noble Baroness, Lady Humphreys, has already spelt out the case, a case set out excellently in the publication by the Electoral Reform Society Wales. The facts, briefly, are these. In Scotland, there are 128 Members of the Scottish Parliament; in Northern Ireland, there are 108 Members of the Assembly; in Wales, there are 60. Once you take out the Ministers, Deputy Ministers and Officers of those various Houses, you have this result: in the House of Commons, 525 Back-Benchers; in Scotland, 113 Back-Benchers; in Northern Ireland, 92 Back-Benchers; in Wales, 42 Back-Benchers. That is well below the minimum number that can form a reasonable critical mass to carry out that function.
Edmund Burke said that, for evil to triumph, it is necessary only for men of good will to do nothing. If anyone wants to bring about the evil of destroying the very future of the Welsh Assembly, and everything that is possible within its grasp, all you have to do is to do nothing in relation to that membership. It is simply impossible for it to carry on with that small number. The Electoral Reform Society has argued strongly the case for 100 Members. It has carried out surveys in all parts of the world and found that that is about the average for what might be called a sub-parliament of this nature.
For myself, I would ask people to exercise a bit of faith and imagination, to consider how that rising curve of expectation that we have seen in Welsh constitutional development over the past 15 years might continue, and to say that 120 might not be impossible. The beauty of the figure of 120 is that it is very simple: you simply double the number of Members that you have at present.
I turn briefly to the question of reserved powers. It is simply ludicrous that if a person wants to find out whether or not a particular function has been devolved to Wales, he or she might have to look at 600, 700 or 800 little pieces of constitutional confetti just to find out whether that matter has been transferred. That is no way to run a parliament. Indeed, by placing the situation on the basis of reserved powers, we place Wales in exactly the same position as Northern Ireland and Scotland. That would also save a whole generation of Welsh lawyers from acute constitutional neurosis.
Wales stands at a point in time where there are many challenges, many dangers and many possibilities. This House must have heard the quote from the Bard of Avon very often:
“There is a tide in the affairs of men
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries”.
There is a tide in the life of a small nation, as well, and we must do all we can to see that we do not miss that fateful opportunity.
Lord Rowlands (Lab)
My Lords, many Members of the House who have spoken today have referred to their personal position on devolution. It was a curious coincidence that, as I prepared my thoughts on the Bill, I had an e-mail from a sixth-former in West Wales, Eleri Williams, with a questionnaire. The first question was: had I been a supporter of devolution? I fear that I am in a minority of one in this afternoon’s debate, as I confessed to her and now confess to the House that I was a most reluctant supporter of devolution. That was, frankly, from personal experience as a parliamentary historian who then had the great privilege of sitting for 33 years in the other House, 29 of them representing an iconic Welsh constituency. The notion that I should share this responsibility was rather underwhelming, and the notion that I would lose any constituency responsibility for health, education and transport was very unappealing. That was one factor that led me to stand down in 2001.
However, unlike my noble friend Lord Morgan—Professor Morgan—I think that since then the settlement has benefited from being gradual. We can so easily forget how frail and fragile the support for the settlement was in the first place; it was a very marginal issue. I believe that the gradual approach has been important in allowing the Assembly to build support for the process and for itself. Because of where I come from—the position I take on devolution—I believe that we should not be obsessed by aping the Scots or following the Scottish line. We should shape our devolution settlement based on our political culture and our own demographic factors. That is extremely important.
However, I believe that we are at a stage when one extremely important change has to be made, to which—as, I confess, a reluctant devolutionist—I now give my wholehearted support. That is the whole issue of reserved powers. As a result of the changes that have taken place, this reform is now overdue; it is a most important reform that needs to be made. I regret that it is not in the Bill—not only that, but I am not certain where the Government stand on the issue. Are they just saying that they do not have time to include those proposals in the Bill? Do they support in principle the idea that we should have reserved powers? That is an area that we will need to explore in Committee, because it is becoming extremely important. The case was powerfully made by my noble friend Lord Morgan earlier. That is certainly an issue that we shall pursue in Committee.
The next question that Ms Williams posed to me in her questionnaire was: what did I think about the electoral system? I explained to her that it had been designed primarily because of the fear that the Labour Party would dominate the Assembly if there had been a completely first-past-the-post arrangement, so the electoral system had been successful because there has not been a dominant party. I did have to say, however, that I thought that Clause 2, reversing the ban on dual candidacy, was foolish. I recall vividly the reaction, certainly in our area in West Wales—in the 2003 election, I think it was—to the notion that people who had lost an election should then be elected as Members. Whether we are for or against that, I should much prefer Clause 2 to go and to insert a clause that states that the Assembly should make those decisions. Let the Assembly from now on determine the electoral arrangements. Why is this House going to determine whether dual candidacy is right or wrong? It should be the Assembly’s responsibility, and it would be preferable if we abandoned Clause 2 and introduced a clause that allowed the Assembly to determine its electoral arrangements.
The borrowing powers are important and I support them, as I support the two minor taxes, although, again, I hope that we scrutinise them in Committee, because from reading some of the Commons debates, I do not think that either clause was scrutinised in a proper fashion, and I believe it to be the duty of this House to do so.
On the question of taxation, having read the carefully considered argument that Silk produces, I accept his argument for tax-varying powers, but I hope that we do not become obsessed by them. It would be political surrealism to believe that Governments of whatever political hue will seize on and make dramatic changes in taxation. At best, I think that they will be marginal. As my noble friend reminded us from the Front Bench, a 1p change in tax one way or the other is worth £200 million—not insignificant, but quite insignificant in a budget of £15 billion. I would not wish hot-headed debates to take place on whether we should say yes or no to 1p when a bigger debate about the whole nature and contribution of the Budget and the priorities in that Budget should be centre stage.
I turn finally to a point made by a number of noble Lords: the concern I share about the potential pressures on the Assembly in terms of scrutiny. I had the privilege of sitting with my noble friend Lord Richard on the Richard commission. We spotted then and felt that there was not a robust enough scrutiny system and that this was related to the number of Members of the House. We are now 10 years down the road, the Assembly is accruing more and more responsibilities and powers, and the issue of the robustness of the scrutiny process is a major concern.
With a Welsh Treasury we will have debates on taxation and on public finance issues, so we should remember how powerful and important a role is played in the other House by the Public Accounts Committee, and how uncomfortable Governments have been made by an awkward bunch of Back-Benchers questioning and pressurising. It is one of the great committees of the House and is very effective. I just do not feel that there is the same sense of an awkward squad creating problems and making Governments of whatever party uncomfortable and I think that that is partly related to the size of the Assembly itself: there are not enough Back-Benchers. Therefore I believe that we should accept, as a consequence of the Assembly accruing ever more power, that it has to have the capacity to scrutinise that power, otherwise we will have government but not a democratically scrutinised Government.
It is interesting that there has been almost unanimity in this House—it is easier for us to say, because we are not elected. It is a problem to present an unpalatable case for more politicians, but the case has to be made. It has to be seen in the context of the further accrual, the development of the devolution settlement and the expansion of the Assembly’s powers.
I welcome parts of the Bill and certainly look forward to scrutinising it. I do not know whether I should lock-step or not lock-step; I shall work that out in the course of our debates—and as for indexation and all the other issues, they look like the grist of a good Committee stage. However, I plead that we will not miss, as the professor and noble Lord, Lord Morgan, said, the slightly bigger picture; in particular, the importance of the role of an enhanced National Assembly to deal with the scrutiny of these powers.
Lord Roberts of Llandudno (LD)
My Lords, it is quite thrilling to hear the unanimity of those who have spoken, and our support for the Bill. We should show our appreciation of those who went before us and who fought on these issues, such as the noble Lord, Lord Prys-Davies, and the late Lord Richard Livsey, who were here for the last major debate on Welsh government. Perhaps we can send Gwilym Prys-Davies—he is still alive, you know—our regards at this time. There are others one cannot name.
I was going to spend a long time arguing that we should increase the number of Assembly Members from 60 to 80. I do not need to do that; the case has already been made. What we have to do now—and here I shall come into conflict with one of my colleagues—is to decide how we are going to reach that figure of 80. In Scotland, of course, we have the single transferable vote for local government. I have fought for this all my life. I do not know whether I would win the argument in this House, but certainly I might try it. At the moment, we have 40 constituencies, each electing one Member by first past the post. The remaining 20 are in five regions and, in order to get some proportionality, we have the sharing of the vote there, which seems to work quite fairly—as fairly as anything we could devise at present. One suggestion was that there should be two-Member constituencies. Let me give one or two examples.
The noble Lord, Lord Rowlands, of course, represented Merthyr Tydfil, which used to be a two-Member constituency. The Tories never stood a chance there. It was always Liberal, and elected Keir Hardie. It never gave the minor party any chance at all. It had gone, of course, by 1929. The only one I can cite at the moment is Blackburn. In 1929 Blackburn was a two-Member constituency. Both socialists were elected and they polled 37,000 and 35,000 votes, but the Liberal and the Conservative polled 35,000 and 34,500 votes. It was winner takes all. To have that sort of arrangement would not be democratic or representative at all. We get it in local government sometimes. We get two-member wards and three-member wards and it is usually the same party that takes all the seats. I do not think that that is going to be acceptable to this House or to the people of Wales.
Lord Wigley
When I spoke earlier noble Lords may recall that I, too, had a preference for STV as a system, but I put forward the idea of two Members to each constituency—in the context not of an 80-Member Assembly but of a larger Assembly where there would still be a list, a presence that would bring proportionality or at least something approaching it.
Lord Roberts of Llandudno
I very much look forward to having the debate when we come to that amendment in Committee. I am sure that noble Lords see the argument that simply having two-member wards or two-Member constituencies would deny us fair representation.
We come then to the question which has been debated here, which says that a candidate cannot stand for a constituency seat as well as for a list seat. Delighted I am—that is a good Welsh way of saying it—that we are going to make it legal for a Member to stand for a regional seat, a list seat, as well as for a constituency seat. I do not quite agree with what the noble Lord, Lord Rowlands, said, that we simply do that so that those who are defeated at one level are successful at another level. Candidates are generally chosen for their profile and how they are able to contribute to the work of the Assembly if elected. What is wrong with trying to enable your most outstanding candidates to be elected on a first past the post system or a regional list system? We want the best people in the Assembly, and that is made easier by this recognition of dual candidacy.
In Wales, most of us vote for five different authorities: Europe, Westminster, Cardiff, the unitary authority and our community council. Are we voting too often? I am not going to deny anybody, but could we not merge the votes for, say, the community council and Europe, so that we do not go to the polls five times when we could have just the same democratic influence by going less often? I would even approve of elected local health authorities. I do not suggest that they be elected on another day, but that they could be linked so that we can make the most of these election days.
I now turn to finance and how the funding of elections and of constituency campaigns needs to be looked at in Wales. On the membership of parties, I do not have figures for Wales alone, but only those for the United Kingdom. In 1990 the Conservative Party claimed a million members. In 2011 it had 130,000 members. Membership has crashed, and not only there. In 1990 Labour claimed 311,000 members and this year it claimed 193,000 members. The Liberal Democrats had 77,000 members and now we have 49,000 members.
Diminishing membership means that fewer people are able to have more influence than before. The mass membership has gone. I remember being invited to speak to a women’s afternoon meeting—it was not Liberal, it was Conservative—and 300 people were going to be there. We do not have that now. You would have had fundraising with Christmas fairs, whist drives and regular party branch meetings, which brought in the money. Who pays now for the expenses of our candidates at elections? Where does their party funding come from?
The coalition agreement has a statement in it which refers to,
“reforming party funding in order to remove big money from politics”.
We need a thorough review of party funds. I have here the names of the top donors for one quarter of 2014. I will not read those names but one contributed £1.5 million to the Conservative Party—in one quarter. Two others contributed £500,000 each to the Scottish National Party while the unions, of course, contributed very generously to the Labour Party. Now, he who pays the piper pipes the tune, so we should look at this. Especially in a Welsh Assembly, who pays and where is the influence?
The turnout in Welsh Assembly elections has never been 50%. In 1999 it was 46.4%, in 2003 38%, in 2007 43%, and in 2011 41%. The decreasing turnout over the past 50 years at all elections is a dangerous signal indeed because it means that with small branch and party memberships, and those people who are generous in their party contributions, an unhealthy influence is possible. I have presented a Voter Registration Bill, which I hope will be debated in the coming Session. In February 1974, 70% of 18 to 24 year-olds voted in the general election but, of the 5.6 million young people in the UK at present, only half are registered to vote and of that number only 24% are certain to vote. Why is that? It is because millions of citizens, especially young people, see politics as boring, out of touch, elitist, corrupt, complicated and unrepresentative. Such a small number of people are holding the reins of power now but it does not have to be that way. Our democracy can, and should, be something that everyone understands and has a stake in.
The Bill which I have presented is aimed especially at teenagers, encouraging them to register to vote and encouraging electoral registration staff to work with schools to ensure that every possible student is registered to vote. Northern Ireland already leads on this, where it is a schools initiative. As I will propose in the Bill, Wales needs this new way of registration to encourage all our young people, as well as everybody else who is eligible to vote, to cast their votes. The Welsh Assembly must belong to the people, not to a small number of them. It must be seen to be responsive to the people, not to small political parties or wealthy individuals. We have an awful lot to discuss on the coming Bill and I look forward very much to bringing these suggestions forward.
Lord Howarth of Newport (Lab)
My Lords, in a democracy, decisions ought to be taken at the level closest to the people whose lives they affect. The principle of subsidiarity is right, the moral and emotional case for devolution is powerful, and I support the Bill. But how to design a model of devolution in practice is far from straightforward. Politics is about reconciling and balancing different interests. How much devolution, and what kind of devolution, is in the interests of Wales and is in the interests of the United Kingdom? A wisely designed model of devolution—the holy grail—would strengthen both.
The first requirement is that the model of devolution should be clear, which is why I agree with many noble Lords who have spoken that it is now time for Wales to have devolution on the reserved powers model, not on the conferred powers model which leads to disputes in the courts and creates profound uncertainty. Silk was clear about this but the Bill, disappointingly, fails to address it. In this regard, Wales should be placed on the same footing as Scotland and Northern Ireland.
As my right honourable friend Peter Hain once remarked, devolution is not an event but a process, and the people of Wales have now made up their mind, after much initial hesitation, that they like devolution. They are glad that they have it and, as the noble Lord, Lord Elystan-Morgan, said, they have advanced up the curve of expectation and confidence. Wales is not Scotland, but if the people of Wales want no less devolution than is allowed to the people of Scotland, they should have it. But of course that raises the question: what do the Scots themselves want? And, as we consider these matters, what is in the interests of England, which is a thought all too commonly absent in debates on devolution? How can devolution strengthen the United Kingdom in the interests of all? Vague and open-ended promises of devo-max made by political leaders in the run-up to the Scottish referendum do not seem to be a responsible or satisfactory way to proceed. How is all this going to end?
Most of the wider constitutional issues that were considered in Silk Part II have been deferred to the other side of the Scottish referendum on 18 September. But perhaps after that, people will start to suggest that they ought to be deferred beyond a possible referendum on the United Kingdom’s membership of Europe. The noble Lord, Lord Wigley, stressed the importance to Wales of membership of the European Union. It is never the right moment to decide what the next stage of devolution should be but it is good that the Government are proceeding in the Bill. We should proceed where there is sufficient consensus both within Wales and across the political parties in the United Kingdom.
Although the constitutional issues have been largely deferred, there are provisions in the Bill on elections. The Bill would bring back dual candidacy: the right of a candidate to stand both in the constituency election under first past the post and on the regional list. As my noble friend Lord Rowlands has just recollected, the origin of these mixed elections was the recognition by the Labour Government in 1997 and 1998 that a Welsh Assembly elected solely by first past the post would, given the political patterns of Wales, be Labour-dominated for as far as the eye could see. It was Aneurin Bevan who remarked that “the purpose of getting power is to be able to give it away”, but that magnanimity is all too rare in politicians. It was found, however, in Ron Davies, the Secretary of State for Wales at that time, who believed that it was right to create a Welsh Assembly that would be in some sense ecumenical.
It is of course right that the parties should contest elections under both systems but I strongly believe that it is inappropriate that individual candidates should be able to run simultaneously under both systems. That being permissible, we got the absurd situation in the Clwyd West election in which all four first past the post candidates were elected. That can hardly have encouraged political engagement. Why bother to vote at all if everybody gets in? The noble Lord, Lord Bourne, observed that the people of Wales were not confused about this. No, I do not think that they were confused but simply that they were shocked, and the abuse got worse because those who had been elected on the regional list system then used publicly provided funds to set up constituency offices to establish a power base in the constituencies which they were targeting.
The noble Lord, Lord Wigley, said that the Labour Party’s objection to the restitution of this state of affairs is—and I wrote down what he said—naked party-political jiggery-pokery. I was going to refrain from mentioning in my remarks the scandal of Leanne Wood’s leaked memorandum to Plaid Cymru candidates in 2003 but, provoked by the noble Lord, I think it right to remind the House of it because not all noble Lords may be familiar with what she said in her missive to them. She said:
“We need to be thinking much more creatively as to how we … use staff budgets”—
those are budgets provided by the taxpayer—
“for furthering the aims of the party”.
She went on:
“Regional AMs are in a unique position. They are paid to work full-time in politics and have considerable budgets at their disposal. They need not be constrained by constituency casework and events, and can be more choosy about their engagements, only attending events which further the party’s cause. This can be achieved by following one simple golden rule: On receipt of every invitation, ask ‘How can my attendance at this event further the aims of Plaid Cymru?’ If the answer is ‘very little’ or ‘not at all’, then a pro forma letter of decline should be in order”.
This is a scandal that in the annals of political scandal should be in red letters and I hope that it makes even the noble Lord, Lord Wigley, blush. It is now a further scandal that the political parties which are the minority parties in Wales are using the majority that the coalition provides for them in Parliament at Westminster to take powers to resume these abuses. They are shameless about it and what they are doing will be seen for what it is. I agree with other noble Lords—my noble friend Lord Rowlands among them—that the Welsh Assembly and the people of Wales should decide their own electoral arrangements.
Lord Wigley
I noted the way in which the noble Lord nipped out quickly to get a copy, quoting from an earlier debate. The question I want to put is this. Would he apply the same change to Scotland now, given the political arithmetic there?
Lord Howarth of Newport
We are considering the political arrangements that are appropriate for Wales. For all the reasons that I have already indicated, it must be wrong in principle; but here we are focusing on the question of Wales.
The core of the Bill is fiscal devolution. It is anomalous that devolution should have created an Assembly and a Welsh Government that apply policies in Wales but do not raise taxes to pay for them in Wales and do not have the close accountability to the people of Wales that levying taxes creates. The fact that that was part of the initial structure of devolution reflects the early diffidence in Wales about devolution when the referendum was won by only a hair’s breadth in 1997.
The taxes that it is now proposed to devolve will be no cornucopia for Wales. Public expenditure in Wales runs at perhaps twice the level of the net tax receipts that the Welsh Government are able to spend. It is quite right that business rates should be determined by local authorities in a system negotiated with the Assembly and the Welsh Government, but that is not going to be a bonanza for Welsh local government. Stamp duty land tax is highly erratic in its yield. Is it intended that the block grant should rise and fall with the fluctuations in the yield of stamp duty land tax? If it is not, we are going to see some fairly halting progress in the kind of capital programmes that the proceeds of that tax should be able to fund. From the last figures that I saw, the yield of stamp duty land tax in Wales was only some £200 million, in contrast to London, where it is in the order of £2 billion. The Mayor of London is asking that that tax be devolved to himself and the Greater London Assembly. That raises the question of how long we can expect London to be willing to subsidise Wales on the scale that it does at the moment. Londoners may want to see Wales raising some of its own money.
I understand that the landfill tax will be a diminishing source of revenue.
Lord Thomas of Gresford
The Barnett formula clearly applies to Scotland and Wales and the reform of it is linked. Does the noble Lord wish to postpone reform of income tax in Wales, or the collection of income tax in Wales, until that whole problem has been resolved?
Lord Howarth of Newport
These issues need to be addressed together. I am hoping to say something about the Barnett formula in a moment.
The devolution of tax, as we know, is to be linked to the question of borrowing powers. The ratio of borrowing permitted in Wales will be the same as the ratio of tax devolution. Borrowing is to be heavily circumscribed by the Treasury in the existing situation—up to £500 million to cover volatility in tax receipts and another £500 million for capital expenditure. That will be increased only if Wales assumes further responsibilities for taxation within Wales. Clearly, the Treasury does not believe that the purpose of power is to give it away.
The situation in Scotland is different. The Scottish Government can borrow up to 10% of their capital expenditure. It seems unfair that there should be lower limits on borrowing powers in Wales, created by this link to income tax. The scope to raise income tax is lower in Wales than it is in Scotland. I agree, therefore, with the Labour proposition that, if the people of Wales wish it, they should have the power to vary income tax to 15%. This question of borrowing powers is absolutely crucial.
The consequence of the arrangements proposed in the Bill is that Wales is placed in an unfair bind and faced with a very difficult dilemma. The noble Lord, Lord Thomas of Gresford, has just drawn our attention again to the Barnett formula. These issues need to be resolved together, particularly against the background that the Welsh budget has been heavily cut by £1.6 billion, and in terms of capital resources cut by 31%, as my noble friend Lady Morgan said. The people of Wales, with lower living standards and a lower taxable capacity, are being told to service borrowing in order to pay for projects that previously would have been funded from the Exchequer. The people of Wales are also being asked to pay for projects, such as the improvement of the M4, which are not just infrastructure for Wales; they are infrastructure for the whole of the UK. When it comes to the referendum, the people of Wales will want to think whether they are being asked to buy a pig in a poke.
The power that the Scots have to vary income tax has not been used over 15 years. The difficulty for a devolved assembly or parliament is that they are politically damned if they do and politically damned if they don’t. There are very difficult problems about introducing differentiated tax rates within a country as geographically compact and economically integrated as the United Kingdom. Wales will experience that more intensely than Scotland because of the permeability of the border and the much greater involvement between the people of Wales and those who live across the border in England.
What matters? Is it the specific powers that are devolved, or that there should be policies that on the part of the United Kingdom as a whole will enable Wales to be more prosperous, that will be fair as between Wales and the rest of the United Kingdom, and will enable Wales to play a strong part in the United Kingdom? There is a large gap between revenue and expenditure in Wales. Wales needs the continuing willingness of taxpayers in England to continue to support it. Some 40% of GDP in the UK is generated in London and the south-east. There are very significant risks for Wales if it embraces the opportunity of developing its own policies on income tax. Above all, Wales must not lose the willingness of the United Kingdom, and England in particular, to continue to redistribute. Wales therefore needs a Government with a vision for the United Kingdom as one nation, a nation consisting of proud regions and nations within it, and a Government who do not disparage the achievements of Wales in education, health and housing. Wales needs a Labour Government who will offer devolution that is not meagre and mean and that will enable Wales to thrive within a thriving union.
Lord Rowe-Beddoe (CB)
My Lords, I broadly welcome the Bill as a major step in the slow yet maturing process of devolution. The words of the noble and learned Lord, Lord Morris of Aberavon, are most wise in his assessment of the whole process, particularly on reserved powers. A number of noble Lords have referred to that feeling this afternoon.
However, when it comes to the elephant, as it has been described, I think that there is actually an entire zoo in the Chamber. The elephant in this room is of course the Scottish referendum. Whatever the outcome of that referendum, life will certainly never be the same in the United Kingdom. I am of the firm opinion that there will be major constitutional change over the next few years. A noble Lord, whose name I did not get, said, “What about England?”. Indeed. That is a whole new issue, which I am sure will be addressed at another time. I certainly do not wish to rehearse any further argument in that regard, but it is somewhat overhanging and must overshadow our attitude towards the Bill over the next few months.
I declare an interest as chairman of Cardiff Airport, which was acquired by the Welsh Government in March 2013. In that context, we are particularly concerned about the asymmetric impact of airline passenger duty on both domestic and international connectivity. I fully endorse the Silk recommendation in that regard and fully support the case for this fiscal power to be devolved. I intend to return to this subject in greater detail in Committee.
The noble and learned Lord, Lord Morris, is no longer in his place, but he tested my memory of 14 years ago, which I think will fail, in so far as if I were to dig into the back of my mind and take account of inflation, I do not think that the Welsh Development Agency’s powers were much less than what is proposed today, if at all. I will be a little more precise in Committee.
However, and it is a big “however”, the increased powers envisaged in the Bill, the other powers discussed in the Chamber today and, indeed, each step of devolution of power place greater responsibility on the Welsh Government. These steps must therefore be accompanied by greater accountability, scrutiny and transparency. These essentials cannot be undertaken with the rigour demanded by the present 42 Assembly Members who are not in the Government.
Already the strain imposed is creaking. Dame Rosemary Butler, the Presiding Officer of the Welsh Assembly, said less than a year ago:
“There are only 42 Members to scrutinise £15 billion of taxpayers’ money, and to scrutinise the government on the big issues of the day—the future of our health service, our education system and the economy. On top of that they have to make sound, thoroughly scrutinized laws for our nation. A quarter of those 42 members sit on three committees, half sit on two. One would simply not find the same level of workload on Members in Westminster, Holyrood or Stormont”.
I therefore conclude that the logic is correct and Wales will need more Assembly Members in order to perform scrutiny effectively and to be seen to be effective, and to provide the necessary assurance to the people of Wales. I realise that my firm support for increasing the number of Assembly Members in my homeland will not necessarily lead to unparalleled joy by certain of our fellow countrymen. However, let us please remember: more responsibility, more accountability and more scrutiny. How the additional Members are elected is clearly an issue for the future.
I turn to a point made by the shadow Welsh Secretary in the other place, in his Third Reading speech:
“We still do not know whether the block grant will be eroded over time. Initially, it will be protected, but the Exchequer Secretary told us again here today that if Welsh gross domestic product and revenues grew more slowly than those of England, Wales would have less money over time to spend on vital public services”.—[Official Report, Commons, 24/6/14; col. 281.]
Chapter 16 of the report of the Silk commission states that,
“transfers of powers should be accompanied by (and be conditional on) transfers of funding being fully agreed between the two Governments in each case, and by agreed changes to the Barnett formula comparability factors”.
Comparability is neither the issue nor the answer.
I return for a moment to your Lordships’ Select Committee on the Barnett Formula, chaired by the noble Lord, Lord Richard, who is unfortunately no longer in his place, on which I had the privilege to serve in 2008. Our findings were published more than five years ago. The attitude of successive Governments—and I look to both sides of the House, including the elephant in the middle—has been to shirk their responsibility. There has not been a single serious debate. Wales has been grossly underfunded over the last 10 years, if not more. Until that is confronted by a Government with the guts, if I may use that unpleasant word, to face it in this Chamber and do something about it, that will obtain. It is ridiculous. We know why Wales is underfunded, of course. I shall not mention the unmentionable. It is because a large part of the United Kingdom has been grossly overfunded for the same period of time.
This formula has been in existence for the past 35 years. There has been no real engagement by political parties in this Chamber or in the other place with discussing the detailed analysis that your Lordships’ Select Committee undertook or the recommendations that we provided. It is deplorable. There has been no review or revision of this formula for 35 years because it is political dynamite. That is the answer—or is it because of political cowardice?
Wales is, and has been, underfunded. The all-party committee of your Lordships’ House unanimously determined that central funding should be based on an explicit assessment of relative needs. Administrations with great need therefore receive more money; Administrations with lesser need will obviously receive less. Your Lordships’ committee recommended, for example, that an expert body be formed—perhaps called the UK funding commission—to determine relative needs by using a small number of need indicators, which the committee identified. That is not unusual; it is in fact similar in principle to the Commonwealth Grants Commission of Australia, which performs this function of the distribution of central federal funding annually.
The formula is inequitable. We can talk around it, we can talk about this and we can devolve this, but there is a central grant and it is inequitable as far as Wales is concerned. It should and must be changed. Where are we? I am still waiting for a political party to grasp the nettle, as are, I am sure, many other noble Lords.
I conclude by quoting our chairman, the noble Lord, Lord Richard, and the noble Lord, Lord Barnett, after whom the formula was named, much, I think, to his embarrassment, as he would say if he were in his place today. The last five lines of his oral evidence to the committee are very moving and I would like to share them with you. Our chairman, the noble Lord, Lord Richard, said:
“You devised a mechanism which you hoped would last for a few years. You did not expect it to last for as long as it has lasted. You are not sure now whether it is based on the right criteria and you lean towards having, among other things, a needs based assessment. Is that fair?”.
The noble Lord, Lord Barnett, said: “That is fair”. I think that we need to address that, sooner rather than later.
Lord Anderson of Swansea (Lab)
My Lords, it is always a pleasure to follow the noble Lord, Lord Rowe-Beddoe, who brings a reservoir of experience on the Welsh Development Agency and in public work in Wales generally. I agree with much of what he said about the scrutiny function, which, because of the increased responsibility of the Assembly, surely demands increased numbers. I also agree with him on Barnett—it was only to be temporary but it remains. I think he would probably not deny being a politician, but he must understand that, certainly in advance of the Scottish referendum and the 2015 general election, it would be foolish to expect any change in the Barnett formula before that time, at the very least.
I join the chorus of consensus in relation to the Bill, but I confess I cannot join the Minister in referring to it as an “exciting package”. As I left my native Swansea on Sunday or Monday, I cannot recall the bells ringing. It is unlikely to excite anyone, I would think. It is fairly limited. I speak at the end of the list. All has been said and I know that the noble Lord, Lord Roberts, would agree if I make three pastoral points. My first point is a simple, general point. It is claimed that the Bill represents another milestone along the road, in the words of my noble friend Lord Morgan, who taught me my politics at the University of Wales. The problem is: where is that road leading? No one knows and no one has revealed that destination—a point, I think, also made by my noble friend Lord Rowlands.
I concede, of course, that the Assembly, having made a shaky start and having only just won the referendum in 1997 by a whisker, is now a fully accepted part of the Welsh political landscape and is doing well. It has pioneered several initiatives that either have been adopted or will shortly be adopted at Westminster. However, there is a professional temptation to stop devolution at Cardiff; perhaps any move to city regions will provide a new opportunity for devolution within Wales and not just to Cardiff. Perhaps the report of the Williams commission, which reported in January, will provide such an opportunity. I note that the First Minister said a few days ago that there will be an expedited consultation period by September with the proposals brought forward in October. With the 10, 11 or 12 new larger local authorities in Wales, there will certainly be a much greater opportunity for devolution within the Principality, accepting the principle of bringing more power closer to our people.
In the 1970s, when I was a member of the so-called gang of six, my concern was always the problems posed by devolution in a unitary state—problems which could be solved in a federal system with clarity in the division of powers. The problems of constitutional principle remain today. Clearly, in this country, we do not do constitutions. Hence, I now agree that there should be reserved powers rather than conferred powers to the Assembly, and I note what other Members of your Lordships’ House have said about the absurdity of the Wales Office losing, on a series of references by the Attorney-General, on the question of the competence of the Assembly. I would ask noble Lords to read the judgment of 14 July, in relation to the power of the Assembly to regulate agricultural wages, before the very strong Supreme Court. I also note that it did not matter in principle whether the subject—in this case, agricultural wages—might also be capable of being classified as relating to a non-devolved area.
For the moment, we are likely to see a continuation of a series of small steps. I think that my noble and learned friend Lord Morris of Aberavon used the phrase “drip by drip” in his excellent contribution—a little bit of this, a little bit of that, with perhaps air passenger duty relating to Cardiff airport being in the next drip which is coming along. The Scottish referendum, even with a no vote, gives an opportunity for a rethink in Scotland, and that is bound to have repercussions for Wales. The Strathclyde report, published in June of this year, recommended that 40% of Scottish expenditure should come from devolved income tax. I think that that will have substantial repercussions. Perhaps there is never an ideal time for making rules of this nature, but to do so in advance of the Scottish referendum is manifestly not ideal.
I will not quote it now, but I commend to the House the Financial Times editorial of 16 June headed “Towards a federal future for the UK”, which argues that Wales and Northern Ireland should gain similar enhanced powers to those likely to be granted to Scotland. A new constitutional settlement, I say in passing, might also include a more consensual reform of your Lordships’ House. If we are really keen about removing the metropolitan flavour of this House and wish to involve people in the devolved Assemblies and local authorities more, we might have some form of indirect election.
My second point is that the package of financial proposals is complex and subject to further consultation. The new borrowing powers are most important and welcome. What prevents these borrowing powers coming into effect sooner? Why should not the formula, as many colleagues have argued, be the same as for Scotland, which would more than double the amount of borrowing available to the Assembly? I have noted the current controversy in the Assembly about the amount to be spent on the road network around Newport. I hope that the Assembly will avoid the temptation, which perhaps we always have in Wales, of spreading the amount non-strategically in penny packets and look strategically at the needs of Wales. It may well be Newport this time—it cannot be Swansea—and may be north Wales next time. However, let us at least look strategically at the major problems that face us. The principle of increased responsibility for expenditure is absolutely right, but I do not believe that the relatively small sums involved will take us sufficiently far along that road for the linkage between elections and responsibility for expenditure to be clearly perceived by the Welsh electorate as a means of generally holding those who spend the money to account.
We also have to be very wary in Wales of fiscal competition with richer areas. I note that the Mayor of London has now proposed devolving receipts from stamp duty in London to the Greater London Authority. That sort of devolution to London which they may pick up from us could have very adverse consequences for Wales. I shall not mention the Barnett formula, or Holtham and the general underfunding of the Principality, and that the people of Wales clearly would have as a priority poverty, youth unemployment, health and education rather than tinkering with relatively small revenue-raising measures. The margin of variation of income tax after a referendum would be small, and it must be asked whether there is much incentive to vary in any event. If we do not vary, what is the point of the power in any event? I remind your Lordships that only about 4,000 taxpayers in Wales pay the top rate. I assume that most are fairly close to the English border; surely some work should be done now on how they are likely to respond to an increase or decrease in the Welsh element of income tax.
Apart from stamp duty land tax and landfill tax in Wales, the Bill also enables other taxes to be designated as “devolved taxes” through secondary legislation. It would be helpful to know what other taxes the Government have in mind. Some could be dangerous—for example, a hotel occupancy tax could hit the tourist areas in Wales very hard—so we have to be extremely careful.
My third and final point is on the dual candidacy rules. Such electoral arrangements should surely, as my noble friend Lord Rowlands said, be a matter for the Assembly in any event, and it is wrong in principle for us to intervene, as the Electoral Reform Society Cymru has said. One of the noble Lords opposite said, as did the noble Lord, Lord Wigley, that it was nakedly partisan of the Labour Government to have brought this forward. Let me list some of those nakedly partisan people that have opposed the dual candidacy. For example, the noble Lord, Lord Crickhowell, the former Conservative Secretary of State for Wales, said:
“The present arrangements are really pretty indefensible”.—[Official Report, 15/6/05; col. 1216.]
Again, the current Chief Secretary to the Treasury, Danny Alexander, said:
“I should also point out that the Secretary of State for Wales has said that if the Commission had considered what he called the systematic abuses carried out by list members in Wales, he would have reached the same conclusion that we have, namely that a ban on dual candidacy is the only effective solution”.
So much for the nakedly partisan nature of what the Labour Party has done—I think that this is good moment to call a cloud of witnesses in support of my contention.
I will not rehearse all the arguments, such as the Alice in Wonderland situation in Clwyd West in 2003, when there were prizes for everyone—everyone was a winner, as a fairground stallholder would say. I also note the Llanelli situation in 2003, which I witnessed, where the Plaid Cymru candidate, who had lost and was weeping copiously, then went half an hour along the road to Carmarthen and exulted at having won a position on the list.
The defence of the proposed change—proposed by some—is that it enables candidates to stand in both constituencies and on the regional list because the pool of able people in Wales, particularly for the smaller parties, is limited, and we should do our best to ensure that the best people find their way to the Assembly. It is surely a nasty slur on the people of Wales to say that we cannot produce sufficiently able people. I used to travel a lot when I chaired the Foreign Affairs Committee, and I recall the quality of politicians in Luxembourg, for example—pace Mr Juncker —and even in little Gibraltar. I used to admire the quality of the politicians there. We in Wales will not do worse than that. Is Wales so different? To quote, or misquote, the Reverend Eli Jenkins, “Thank the Lord we are a political nation”. Although I can see that there are arguments on both sides, I will certainly vote against the proposed change.
Overall, then, two cheers for the Bill, but I am still confused as to where such drip-by-drip Bills lead us: a brave new future for the Principality, or a constitutional labyrinth for our people.
Baroness Gale (Lab)
My Lords, it is a great delight and a pleasure to speak on behalf of the Opposition in this debate on the Wales Bill as we take our further steps on this journey of devolution which—as noble Lords who have taken part in today’s debate have outlined—we have been travelling along for many a long year. Many of those who have taken part in this journey—and some started way before I did, including my noble and learned friend Lord Morris and the noble Lord, Lord Elystan-Morgan—have shared with us their breadth of experience today. It has been said that we will have an exciting time as the Bill goes through, and I would not be surprised if we do. We have set the scene today for that.
We have had a good debate that has shown the breadth of experience that we have in Wales on all matters of devolution, and I thank all noble Lords who have taken part. I also thank the Minister for opening the debate and explaining so clearly what the Bill is about and the Government’s view on it. This is a small but important Bill. Its measures are important for Wales and devolution alike, and I am glad that today’s debate has provided testimony to that. However, we would like the Minister to answer a few points. As noble Lords have mentioned, the Bill has three parts: electoral arrangements, tax devolution and borrowing powers. We have five main points to ask the Minister on those areas and about how we can work to enhance the Bill, which we will want to examine further in Committee and beyond.
Labour’s five main asks are: first, that the Government accept the basic principle that Assembly elections are a matter for the Assembly itself—I will speak on that later; secondly, that the Minister explain why the Government are acting against their own and other evidence by removing the ban on dual candidacy; thirdly, that the Government make clear their position on tax competition and on whether, given recent changes in the Wales Office, for example, they still wish to start tax competition between the nations of the UK; fourthly, that the Minister explain how the Government arrived at the limit on capital borrowing and how that compares with the limit in Scotland; and, finally, that the Government consider enhancing the Wales Bill to include details of the next steps towards a model of reserved powers. I am sure that the Minister will deal with those points as we make progress during the Bill’s passage.
On Assembly elections, the Government have championed the greater responsibility that the Wales Bill will give to the Welsh Government. Yet, the very first part of the Bill is a change to Assembly elections that is being made through this Parliament and not through the Welsh Assembly. Many noble Lords have spoken on that, including the noble Lord, Lord Bourne, who gave his clear views; the noble Baroness, Lady Humphreys; and the noble Lord, Lord Thomas—who warned me this morning that he would attack the Welsh Government. He certainly lived up to that in his contribution. The noble Lord, Lord Wigley, also spoke about that issue. It was interesting that he also talked about the gender balance. I have previously heard the noble Lord, Lord Elystan-Morgan, say that it is impossible to carry on with the low numbers in the Assembly. In a previous debate he talked about 90 Members, but now he has mentioned 120. I was very interested that the noble Lord, Lord Roberts of Llandudno, said that we should have not a ban but the most outstanding candidates. I hope that we have outstanding candidates in Wales, whatever position they take and whatever the list or constituency. I have no doubt that we do, in all parties.
That poses a question. Why do the Government not allow the Welsh Assembly to set the parameters of their own election system? Why should the UK Parliament dictate to the Welsh Assembly what election method should be used? A number of noble Lords raised that issue in the debate. The Welsh Government believe that they should have the responsibility for this. In their response to the Wales Office Green Paper, they said that,
“no change to the Assembly’s current electoral arrangements should be made without the Assembly’s consent. This is the fundamental constitutional principle in issue”.
We agree with that fundamental principle, and it is disappointing that the UK Government do not share that view. We will continue to make what should be an uncontentious point—that Assembly elections should be a matter for the Assembly. We strongly believe that these matters should be decided in Wales by the Welsh Assembly.
A number of Members had views on dual candidacy. We think that the Government should explain why they are acting against their own evidence, and that of the Bevan Foundation, in removing the ban. Labour shares the wider concerns of the public that removing the ban is anti-democratic. Allowing losing candidates effectively to get elected by the back door is clearly not what voters want. At a time when voter engagement is low, having a system that allows losing candidates to be elected elsewhere will not instil confidence in the system.
It is not surprising that two significant surveys on dual candidacy found a clear majority in favour of the ban. One was the Government’s own consultation, the other a Bevan Foundation study. According to the Government’s consultation, a small majority was in favour of the ban on dual candidacy. The report states:
“In March 2013 the Secretary of State … announced the Government’s intention to remove the prohibition on dual candidacy at Assembly elections. A small majority of respondents to the consultation were in favour of retaining the ban, but the Government does not think that a strong enough case for this was made in the consultation responses”.
Why put the question, if the Government then ignore the answers?
The Explanatory Notes to the Wales Bill suggest that this change will benefit smaller parties in Wales:
“studies by the Electoral Commission and others … have demonstrated that the prohibition has a disproportionate impact on smaller parties who have a smaller pool of potential candidates to draw upon”.
That quote is from the Government’s own papers. We are changing the law because some parties cannot find enough candidates in Wales to field at election time. The only way round this is to allow them to stand in the constituency and in the list. Giving a helping hand to smaller parties is not a good enough reason for a change, as proposed in the Bill. Will the Minister explain why the Government are ignoring their own evidence by pressing ahead with what we believe is an anti-democratic change? Many noble Lords spoke about this and I know that there are strong feelings on both sides. We intend to pursue this in Committee, and I am sure that there will be further arguments and debate on it.
My noble friend Lady Morgan outlined our views on income taxation. As she said, it is probably the most controversial part of the Bill. We believe that the proposals outlined in the Bill on income tax devolution are not a priority and that there would have to be a referendum on it if it were brought about in the Welsh Assembly. Many noble Lords recalled today how we started on this journey. In 1979, no counties in Wales voted in favour. We made a progression as the years went by, after we recovered from that awful campaign— I think that both sides could use that term.
Lord Elystan-Morgan
I make one small correction: Cardiganshire was an exception. It did vote for it.
Baroness Gale
I thank the noble Lord for his intervention. He may be able to pull me up on other things. I know that he has a fantastic memory and experience in this field.
We believe that we should have a referendum on income taxation. Many noble Lords referred to the 1997 referendum. I worked hard on it, as did a number of other noble Lords. The Labour Party policy then was not like that for Scotland because Wales is not a mirror image of Scotland. We do not do things just because Scotland has done it. It might not suit our country. However, we do what is best for Wales. I am sure that others would agree that we probably would not have won the 1997 referendum if there had been a question on income tax in it. It was so close that we could not have included that. We have now progressed further and we will discuss it further. We agree with the Government that a referendum is needed on this. However, we support the other taxes—the landfill tax and the stamp duty land tax—as a means to give the Welsh Government borrowing powers. As my noble friend indicated, we will want to look at this again in Committee.
My noble friend Lady Morgan spoke about the borrowing limits and a number of other noble Lords have also referred to them. I have no doubt that we will debate them further as we progress through the course of the Bill.
It was interesting that many noble Lords felt that we should have the reserved powers. My noble friend Lord Rowlands said that he wished to explore this in Committee, and I know that we will. The noble Lord, Lord Wigley, my noble and learned friend Lord Morris and my noble friend Lord Howarth spoke about them, as did others. We want to amend the Bill to set in motion Wales’s move to a model of reserved powers.
The former Secretary of State was opposed to reserved powers. As a result, the Attorney-General referred Welsh legislation to the Supreme Court, at great cost to the taxpayer. The recent outright rejection of the UK Government’s challenge to the agricultural wages Bill by the Supreme Court made the case for reserved powers even stronger. With such a decisive ruling, we will once again be looking at ways in which we can persuade the Government to use this Bill to move to reserved powers. However, the next Labour Government will legislate to give Wales reserved powers. I look forward to what the Minister has to say on these matters, and I am sure that we will be discussing them at later stages.
This has been a very important debate and I am grateful for the opportunity to speak to the measures in the Bill. I hope that the Minister will be able to address the concerns that I have raised. We will continue to raise these concerns in Committee through to Third Reading in order to improve the Bill. We support a number of measures in the Bill but we believe that it can be improved. We will be tabling amendments which we hope will make the Bill more beneficial for the people of Wales.
I look forward to our further debates in Committee and at later stages. I am sure that we will have even more interesting and exciting debates and that we will conduct them in the spirit of today’s debate. I look forward to the following stages of the Bill and I now look forward to what the Minister has to say.
Baroness Randerson
My Lords, this has been a good debate. I believe that it has reflected the constitutional importance of the Bill for Wales and for the United Kingdom as a whole. I fear that at times it was a debate on a Bill that many of us would like to write rather than the one before us. As the Minister in charge of the Bill here, my first priority is to ensure that we steer the Bill through safely in the time that we have left in this Parliament. It is very important to me personally that we ensure that that is done because across the Chamber today I have noted very strong support for the Bill in general terms.
I am a devolutionary enthusiast but I am also a pragmatist, and I realise that in some ways the timetable is not ideal. As several noble Lords have mentioned, the Bill is being discussed in the shadow of the Scottish referendum, a point made powerfully by the noble Lord, Lord Rowe-Beddoe. We will then have our Committee stage very close on the heels of the result of the Scottish referendum without having time to reflect and to develop ideas. Therefore, I urge noble Lords to judge the Bill on the basis of where we are at present and the fact that it is being very firmly based on the Silk 1 report. The Silk 2 report is for another day and it needs to be considered in the light of our party manifestos. My party’s manifesto will contain a very firm commitment to delivering the Silk recommendations, and I hope that I will see things that I recognise in the manifestos of the other parties represented here today.
I shall try to reply to as many of the issues raised by noble Lords as possible. Many speakers, including the noble Baroness, Lady Morgan, and the noble Lord, Lord Wigley, mentioned the lock-step. It is clearly something that is going to continue to generate passionate debate. I said in my opening speech that the Government continue to believe that the approach set out in the Bill is appropriate for Wales, given the potentially far-reaching and significant effects of allowing the Welsh Government to alter each income tax band independently. That is our belief, particularly in the light of the porous border between Wales and England and the figures quoted by noble Lords indicating that there is a very large population that might cross that border.
The Government believe very strongly in the impact of the tax banding system on ensuring that taxation is progressive and that it reallocates money across society. That is an important aspect that we have been bearing in mind in relation to the lock-step. However, as I said earlier, at this point the Government remain open to revisiting the arrangements for income tax devolution in the light of changes in Scotland, and I am happy to restate that. I also draw noble Lords’ attention to the fact that the new Secretary of State has made it clear that his mind remains open on the issue.
The noble Lord, Lord Anderson, asked: if you do not vary the rate of taxation, what is the point of it? The point of it is that it is the basis for borrowing power. It is used as the basis for borrowing power by the Scottish Government and it would be used as such in future by the Welsh Government.
Several noble Lords, including the noble Baroness, Lady Morgan, referred to the level of the block grant adjustment. A number of different views were expressed on this across the Chamber. I make it clear that if the income tax base in Wales grows faster than that in the rest of the UK, the Welsh Government will benefit, even if the Welsh rate is the same as the UK rate. Inevitably, however, if it grows slower, the Welsh Government’s budget will be lower. That is a simple consequence of more accountability, linking the Welsh Government’s budget to the performance of the Welsh economy. This arrangement would incentivise the Welsh Government to grow the economy in Wales but, importantly, it would protect it from UK-wide effects that the UK Government are better placed to manage. It is a fair system, designed to protect Wales from the greatest volatility and it is consistent with our aims of increasing the Welsh Government’s accountability.
The noble Lord, Lord Howarth, asked about stamp duty land tax volatility. The block grant adjustment will not reflect SDLT volatility. Instead, the Welsh Government are being given new tools to manage tax volatility, which is part of increasing accountability. Those new tools include a cash reserve that can be used to save tax revenues in good years and spend them when revenues are lower than they have been forecast to be. The Welsh Government will also be able to borrow up to £500 million and up to £200 million in any one year if there are insufficient funds in the cash reserve.
The noble Baroness, Lady Morgan, and other noble Lords referred to the sensitivity of the timing of this debate in relation to the Scottish referendum result. I agree, but of course hindsight is a wonderful thing. When the timescale for the Silk process was set out, people did not have any concept that there would be a Scottish referendum at this time.
Many noble Lords raised the reserved powers model. I think that universal support for that has been expressed today across the Chamber. Several noble Lords, including the noble and learned Lord, Lord Morris, also referred to the recent decision on the Agricultural Wages Board. That decision certainly adds to the debate on the issue. However, as several noble Lords recognised and acknowledged, it has to be a longer-term issue. That was recognised by the Silk commission in its second report which made it clear that it was something for manifesto decisions. Even if we made the decision today to go to a reserved powers model, we would not be able to create it and legislate in the timescale left. It is absolutely right that there is a wide public debate on this and I urge noble Lords to encourage that debate.
In many ways the same points should be made about the size of the Assembly and its capacity for scrutiny. It was also an issue raised in the second Silk report, but that is also something for manifestos.
Lord Rowlands
Do I take it that, in principle, the coalition Government are in favour of the reserved powers?
Baroness Randerson
I am specifically making it clear that the Government do not have a position on the reserved powers model. As the Silk report recommended, this is something for manifesto positions from the different parties. However, my party is in favour of the reserved powers model. That does not make it a government position, and it certainly is not something that can be created now. However much one might wish to do so, we cannot write the kind of complex legislation needed for a reserved powers model of devolution for Wales. If we tried to do so at that speed, we would be in danger of ending up with second-rate legislation, which the people of Wales do not deserve.
I move on to the point made by the noble Lord, Lord Wigley, on corporation tax. I remind the House that the Silk commission said that if corporation tax were devolved to Scotland and Northern Ireland it should also be devolved to Wales. There are no current plans to devolve to Scotland and Northern Ireland. However, the Bill contains the power to devolve further taxes to Wales by order. I would like noble Lords to note that. The noble Lord, Lord Anderson, raised the same issue about the power to devolve further taxes. A good example would be the aggregates levy once the EU Commission has completed its investigations. That provision is in the Bill as it stands.
The noble Lord, Lord Howarth of Newport, and others, raised the issue of borrowing powers and why they are not higher. I should point out that there are two capital borrowing limits: the annual limit and the overall limit. The overall limit in Scotland is £2.2 billion, which is supported by around £5 billion of annual devolved tax revenue. Using the same ratio, the overall limit in Wales would have been only £100 million. I ask noble Lords to bear that in mind when they ask for Wales to be treated like Scotland. We accepted that £100 million was inadequate so we increased it to £500 million specifically to enable M4 improvements to be undertaken, although there are no restrictions in law on how that could be spent. Obviously this is a power in perpetuity which the Welsh Government could exert for other things.
Lord Wigley
I asked a specific question on that. If the cost of the M4 relief road around Newport is £930 million, or so, and the limit on the borrowing, prior to having a referendum that would enable more to be levered in, is £500 million, does the balance—the £438 million, or whatever the figure is—have to come out of the capital budget of the National Assembly, and does that mean that all the other projects that are being funded by that are lost?
Baroness Randerson
How the Welsh Government raise the additional money is, of course, entirely at their discretion. It could come directly from their capital budget or they could have a partnership with the private sector to ensure that additional funding is available for them.
Lord Howarth of Newport
Given that the M4 relief road around Newport is an infrastructural benefit to the United Kingdom as a whole, how much contribution are the Government of the UK planning to make to that very large cost?
Baroness Randerson
I think that the noble Lord raises a fundamental point about devolution. The control of building and road infrastructure in Wales is devolved. With it comes the Barnett consequential of the funding for infrastructure throughout the UK, which is reflected in the proportion of the Department for Transport’s budget that is devolved to the Welsh Government.
To complete the point I was making, we have agreed an annual limit of £125 million relating to borrowing in Wales. That limit was proposed by the Welsh Government. A lot of noble Lords referred to the Barnett formula. I remind them that the Holtham report recommended that Welsh funding should be between 15% and 17% above English funding. Funding in Wales is 15% above the funding for England at this time, so it is within the areas deemed as fair by the Holtham commission. That is not to say that it has been fair in the past; it is at the current point because there has been divergence in recent times rather than convergence. I remind noble Lords that in 2012 the Welsh Finance Minister Jane Hutt agreed with the Chief Secretary to the Treasury in an exchange of letters a system to review the situation in relation to Barnett if convergence was about to begin again. That system worked satisfactorily at the spending review last year and it provides a basis for fairness in the future. I am absolutely sure that noble Lords will return to this in the future and that we will be talking about it in some detail.
Lord Rowe-Beddoe
Is the Minister saying that the Barnett formula has been revised in the last 12 months?
Baroness Randerson
No I am not, but the natural process of the way in which the formula works means that in times of spending restraint, where we have been for the last four years, the convergence process, which worked over many years and made the formula more, shall I say, sparing in relation to Wales, ceased to operate and we have had divergence which has brought Wales to a position of greater fairness now than in the past. That means, however, that if we go back to times of financial plenty, there would be an issue once again. That has been recognised in the exchange of correspondence between the Chief Secretary to the Treasury and the Finance Minister in Wales.
In response to the general point made by noble Lords from the Labour Party about dual candidacy, as I predicted, when we read Hansard tomorrow it will appear as the most important matter in the Bill to members of the Labour Party. It is significant to remember that the purpose of doing this is to widen the pool of good candidates. Time and again people have raised the issue of how important it is to have scrutiny of the highest nature in the Welsh Assembly. It is not only a case of ensuring that there are more Assembly Members—whether you agree with that or not—but of ensuring that the best candidates can stand and get elected.
Many noble Lords on the Benches opposite referred to the Clwyd West situation. I refer to the Nick Bourne situation, if my noble friend will forgive me, where, as the leader of a party in the 2011 Assembly elections, he failed to gain a seat because his party had done so well. That is an anomaly, and it is important to bear in mind that within this system you will get that kind of anomaly. I say to the noble Lord, Lord Rowlands, who raised the issue of people who lose still getting into the Assembly, that that applies only if you think that elections should be on a winner takes all strategy. However, if you believe that elections are a way of ensuring that different strands of opinion are represented in our legislatures and Parliaments, you look at ways of ensuring that significant minority opinions are represented as well as majority opinions.
Lord Anderson of Swansea
The very able leader of a party in Wales lost under that system. The solution is simple: his party should have ensured that he sat in a winnable seat.
Baroness Randerson
There are many other answers connected with the problems and anomalies associated with that system. However, I repeat, this system was established by the Labour Party in the first Government of Wales Act. It may not be perfect but it provides an element of proportionality, although not perfect proportionality by any means. Even now within the Assembly, 50% of its members are from the Labour Party even though it gained under 40% of the vote. It is not perfect but it brings some proportionality to the Assembly, which was an essential part of getting the original referendum accepted by the people of Wales.
I conclude by saying that it has been a great pleasure to listen to the debate. I am sure that I will be answering in considerable detail the questions that I know noble Lords will put to me when we return from the Recess. I invite your Lordships to support the Bill.
EU: Justice and Home Affairs (EUC Report)
(10 years, 4 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Hannay of Chiswick
To move that this House takes note of the report of the European Union Committee on Strategic Guidelines for the EU’s Next Justice And Home Affairs Programme: Steady as She Goes (13th Report, Session 2013-14, HL Paper 173).
Lord Hannay of Chiswick (CB)
My Lords, my task in opening this debate is to address the recommendations made by your Lordships’ EU Select Committee with respect to the strategic objectives to be set by the Governments of the 28 member states for the development of the European Union’s justice and home affairs programme for the next five years—that is to say, from 2015 to 2019. The Government’s response to these recommendations is also available and much of what I have to say will be directed to that response. For good measure, we also now have the European Council’s conclusions/decisions on its strategic objectives for the period ahead, which were reached on 27 June and which are available in EUCO 79/14. So, rather unusually, in this debate we are debating the whole issue in the round, from the inquiry and report by your Lordships’ House through the process of negotiation to its completion.
I am speaking as the former chair—until the end of the last session, in May this year—of the EU Select Committee’s Sub-Committee on Home Affairs, Health and Education, which was responsible for the report we are debating. In doing so, I pay tribute to the members of my own sub-committee, to the members of the justice sub-committee who participated in our work, and to the three successive clerks—whose help and support in the last four years was so invaluable to me—Michael Torrance, Chris Atkinson and Michael Collon twice.
Looking back, as we did when we wrote this report, at the rapid development of the EU’s activity in the field of justice and home affairs over the last 20 years, we considered carefully what were the main drivers of that increased activity. On the basis of the evidence that was put before us and the evidence submitted to us in the context of other recent inquiries, particularly those into the block opt-out under Protocol 36 of the Lisbon treaty, we concluded that the main driver was the challenge from the massive increase in serious international criminal activity in recent years. That increase has been not only in volume but also in complexity. It has been marked by the unwelcome arrival of many new fields of criminal activity—in human trafficking, drugs, terrorism, cybercrime, child pornography and financial fraud.
It was our view that none of these challenges could be adequately combated without intensive international co-operation. If you doubt that, just look at the steadily increasing use being made by our own law enforcement agencies of such EU agencies as Europol and Eurojust. The case for much of this justice and home affairs activity is simple: it is to protect our own national security. Those who criticise this development need to explain convincingly how that could be better achieved in some different way. So far they have failed to explain that at all.
We were also clear that in the five years ahead the emphasis needed to be on consolidation and implementation and not on the proliferation of new legislation, which should be brought forward only if there is strong evidence of the need for it. I am glad to note that the Government, the Commission and now, most importantly, the European Council agreed that this should be a period of consolidation and implementation, and those words appear in their conclusions. That approach is encapsulated—slightly more crisply than the European Council managed—in the title of our report, Steady as She Goes.
Within this overall ordering of priorities, we urged that emphasis should be put on the following four main areas. First is the completion of the existing legislative programme. This includes important measures to reform and Lisbonise—it is a terrible word—Europol and Eurojust. It includes the proposals for passenger name recognition and the personal data protection package. Those are all big bits of legislation which remain unfinished and on which much work remains to be done. There are other, less prominent measures still in the pipeline. It does not include the proposal for a European public prosecutor’s office, which we continue to believe does not properly fulfil the criteria of subsidiarity and against participation in which the United Kingdom is protected by clear treaty provisions.
Secondly, we focused on the implementation of all existing justice and home affairs legislation in all member states, which is lamentably not currently the case. This country has its lapses, too, in that respect. One example is the European supervision order, which was mentioned in debate last Thursday. Fortunately that measure, which will enable British citizens to be bailed here until their cases are ready to be tried, is on the Government’s list for rejoining and should be in effect by the end of this year, a mere two years late. Will the Minister confirm that that will, indeed, be the case, assuming that the package on Protocol 36 goes through?
Thirdly, we urged that there should be much more systematic and effective evaluation of justice and home affairs legislation. So far, such evaluation at the European level has been patchy and inadequate and I am glad that the European Council has now agreed that there should be a review in 2015 of the internal security strategy and that there should be an overall review of the justice and home affairs strategic objectives, which we are debating this evening, in 2017, half way through the new programme period. That is a step forward and I hope the Government will be really vigilant in making these processes of evaluation more effective. Fourthly, we emphasised the critical importance of the adequate resourcing and the sound management of the European Union’s agencies: of Europol, Eurojust, the EMCDDA for drugs, ENISA for the internet, FRONTEX and the new asylum agency in Malta. Much of the success or failure of the EU and its member states in their fight against international crime will depend on the practical co-operation which these agencies can provide and engender.
I will say a word or two about the Government’s response to our recommendations. I am glad to say that this was broadly positive and I am grateful for that, even if the tone was, from time to time, just a touch grudging. However, there were a few points of misunderstanding which I tried to clear up. First, we never intended to suggest that evaluation should be entirely and solely in the hands of the Commission: it should not. However, we cannot possibly imagine these programmes being evaluated properly without the full and active co-operation and participation of the Commission, whose task it is to help to carry them out. That co-operation was not forthcoming during the evaluation carried out during the preceding Stockholm programme and it was, frankly, a pretty useless affair. Now that the European Council has mandated an evaluation process, the Commission must be involved. I am sure they will be and the Government should not find that problematic in any way.
Secondly, we made a proposal for an annual implementation scorecard showing—and naming and shaming—which member states had fallen behind on implementing justice and home affairs legislation. This could genuinely be helpful and could work to the UK’s national interest in securing a level playing field. We were not proposing, and we would not support, the much more ambitious type of scorecard championed by the former vice-president, Viviane Reding, which would involve evaluating the overall judicial system of the member states. That is not something the Commission is well placed to do and it ought not to be doing it. The sort of scorecard we suggest would be valuable and I hope the Government will have a further look at that now to see whether it is something they could push forward.
Thirdly, on the challenge of using the yellow card—the subsidiarity procedure—which is of great importance in such a sensitive area as justice and home affairs legislation, how can we make that more effective? The Government seem to have accepted our approach, under which the Commission could, without any need to change the treaty, give national parliaments 12 or 16 weeks rather than the current eight weeks to submit a reasoned opinion, agree to withdraw or to substantially amend any proposal that was the object of a yellow card, and accept that proportionality considerations could be properly raised in a reasoned opinion. Those three reforms would do a lot to make the yellow card work better. I trust that the Government will now be pressing ahead with these ideas. Perhaps the Minister could say how that is going to be carried forward.
In conclusion, I suggest that this inquiry and this report have demonstrated how your Lordships’ Select Committee can insert itself effectively into the shaping of EU policies by formulating and presenting its views upstream of formal policy proposals becoming set in concrete. That surely needs to be something that we try to do more often in the future. On the next occasion that the noble Lord, Lord Pearson of Rannoch, presents himself here and unleashes one of his familiar tirades of complaint against the uselessness of the scrutiny procedure, I look forward to hearing him pay tribute to this report on the EU’s strategic objectives as having shown that we can be effective in that process. I may have to wait quite some time for that tribute but I will do so with patience and in hope.
Lord Judd (Lab)
My Lords, it is essential yet again to place on record the appreciation of members of the committee for the chairmanship and leadership of the noble Lord, Lord Hannay. As I have said on other occasions, he brings a wealth of relevant experience on the front line, which is invaluable as we try to discharge our duties. He is right also to praise the work of the staff of the committee. All the members of the committee found that work outstanding. It really was helpful.
I want to make just two points. First, my experience of the work of the committee has done nothing but strengthen my conviction about the indispensability of British membership of the European Union. The first reality that faces us on issues of security in the United Kingdom is that they cannot be dealt with satisfactorily simply on the basis of the United Kingdom operating as an isolated individual authority. All the challenges of the sinister and large-scale developments in international crime, to which the noble Lord has referred, and all the developments in international terrorism demand international co-operation. As soon as one begins to look at this work in any detail and break free of the superficial, melodramatic comment in the ill informed media, one sees that the safety of our people—the safety of our families—can be nothing but enhanced by the kind of work that is going on in the European Union and elsewhere. It would be absolute madness to jeopardise that in any way.
Of course there is room for improvement and of course it is absolutely right to insist upon evaluation. It is also right to be looking pragmatically at the cumulative effect of what is really on the agenda now as distinct from what was there in theory and how relevant it is. All these things matter. But the second point I want to make is that we tackle these things best and make the improvements that are necessary by the degree to which we can demonstrate our commitment to the institutions. If we are always apparently grudgingly allowing ourselves to continue to be members and always insisting upon saying, “Is this compatible with the British interest?”, it is not really a very constructive or positive approach to winning friends and increasing the strength of collective consideration of these matters at international level. We must work to improve that, but that is made possible by our membership of and commitment to the institutions being in no doubt whatever. That is why I have been so unhappy about the events of the past year, which have undermined our strength in this respect.
It is time that those of us who really care about security and the safety of our people started fighting back much more forthrightly and putting the at times almost neurotically ideological critics of the concept of such European co-operation on the defensive. They are the people who are jeopardising the safety of the British people. We ought to be saying that in no uncertain terms.
The other point I would make—and I understand the reasons for it—is that there is still a certain amount of cultural work to be done in the Home Office and elsewhere. I have terrific respect for the amount of work that is done by the Home Office. I sometimes think that it too easily becomes a whipping boy for all the criticisms and frustrations that exist. It is a tremendously important part of our administration. But there is a psychology which has not yet altogether been overcome, which is, “We do these things rather well, we do them better on our own, although some international co-operation is helpful in specific areas”. I think that is archaic thinking. My own view is that we have to adopt the psychology which I have been trying to describe and say, “There is no alternative to international co-operation. We can only be as effective as the weaker links”. Now, there are weaker links within Europe and we ought, therefore, to be putting all our time, energy and skills into strengthening the work, to shore up and improve the performance where there are such weaker links.
I am very glad that on this occasion the Government have taken the report very seriously—the noble Lord has dealt very fully with the responses of the Government. I am glad about that because I think the Select Committee work in this House matters. I would like to re-emphasise, before I conclude, a point that the Minister made in earlier debates. If the quality of our Select Committee work is to be as high as it should and could be, the greater the degree of priority given by departments—in this context, very much the Home Office—to ensuring the information available to the committee, as it goes about its evaluation and considerations, is as plentiful, as helpful, and as clear as it possibly can be, and the more that can become the prevailing discipline within the department, the better it will be. Papers that arrive without proper time for full consideration—let alone any suspicion that sometimes a department does not wanting papers to be available too soon for consideration—do not help the committee to do its work well. Things have been improving—particularly, if I may say, with the present Minister at the helm. But it is an issue that cannot be given enough attention. Either we need these Select Committees or we do not. I am convinced that we do. If we are going to have them, they need to be serviced by government departments as well as they possibly can be.
Lord Maclennan of Rogart (LD)
My Lords, I ask the indulgence of the House to speak in the gap. This is a very well timed report; it is extremely thorough; and the response of the Government has been for the most part positive. Coming as it does before the Council meeting to consider the first full application of Article 68 of the Treaty on the Functioning of the European Union, it could not have been better timed.
It seems to me that there are a number of important elements in this report which I am glad to note that the Government have broadly adopted. It is generally considered that the Stockholm programme was too detailed and too large to be implemented entirely in the five-year gap, but it has given some guidelines to what is now required. The new guidelines were needed since the Stockholm programme expires in December 2014. A number of the objectives were time-bound. I think also that it is right to recognise that the work that is being done in justice and home affairs by national Governments and the Commission in bringing forward legislation does need to be considered carefully, evaluated and to be evidence-based—a view that was expressed by the committee itself.
I am interested to see that the Government adopt the view of the committee that,
“transposition of existing legislation by all Member States”,
is necessary to enable full co-operation and full equality of approach to the growing problems of crime. It is also encouraging to hear them state:
“Without full and consistent implementation businesses, Governments and citizens cannot be confident that legislation that applies in one Member State will apply in the same way in another”.
That seems to be very much the essence of collaboration in dealing with the growing problems of international crime. It is highly sensible that that view has been taken.
The timetable for review expressed by the Council is encouraging for the evaluation and effective implementation of the measures proposed. As to the scoreboard, I agree with the chairman of the committee, the noble Lord, Lord Hannay, in suggesting that, to make sure that the work is done by other countries, it would be sensible to have such annual scoreboards.
The Government state in respect of drugs that they must operate within the budget, the MFF. I have to ask whether the budget is adequate for that purpose, because the drug problem is growing and spreading.
Baroness Smith of Basildon (Lab)
My Lords, I once again thank the noble Lord, Lord Hannay, and his committee and its sub-committees—as well as the noble Lord, Lord Judd, who has served on them—for the work that they have done in providing this report. We have another quite remarkable report in front of us. Having been to seminars that the committee has undertaken, I have found its work to be extremely helpful and useful in informing our debate and my own knowledge. I think back to the number of debates that we have had around these issues with the committee’s reports, specifically on the Government’s opt-out and opt-back-in on justice and home affairs measures, and they do a great service to your Lordships’ House. We have had some of the most informed debates that I have taken part in here.
Not only is the range of issues covered by the justice and home affairs brief extraordinarily wide but the seriousness of them and their impact on the public are enormous. I know that it is very popular with some parts of the party opposite, although none of them is in their place today—and UKIP is rarely seen in your Lordships’ House for debates on these issues—just to think, “National good, European bad”. The noble Lord, Lord Hannay, I thought somewhat tongue-in-cheek, referred to his optimism that the noble Lord, Lord Pearson, would at some point pay tribute to the committee’s contribution to the debates. He may well have to wait a very long time, because the noble Lord, Lord Pearson, despite his strong views on European issues, is rarely seen in your Lordships’ House to discuss them, but I am happy to pay such a tribute to the committee.
The issues that we are debating today reach into personal safety and security and national security, and have an enormously positive impact. That is not to say—the noble Lord, Lord Judd, made the same point—that there is not room for improvement or that we do not seek changes, but it is essential to public and national security that we have international co-operation on these most crucial issues. Specifically referring to,
“asylum, immigration, border controls, judicial cooperation in civil and criminal justice matters, and police cooperation”,
the report states:
“These matters affect the day-to-day lives of European citizens and are of considerable importance”.
It also makes clear, in paragraph 4, that:
“The whole field is one of shared competence—that is to say, one where the Member States retain exclusive powers on some matters, such as counter-terrorism, but where the Treaty provides for the European Union to take legislative decisions on a limited number of issues”.
My next point, which was made eloquently—more eloquently than I shall be able to make it—by the noble Lord, Lord Judd, is about a fact that we have discussed before: crime does not stop at Calais. We have heard numerous examples in previous debates in your Lordships’ House of cases where co-operation has been essential to bring criminals back to the UK to face justice, and cases where only by Europe-wide international co-operation can a complete picture be built up and effective evidence obtained of criminal activities.
The Minister and I have debated the Serious Crime Bill at some length over the past few weeks, and I know that he, too, is aware of how important it is that we do not try to tackle serious organised crime in glorious isolation in this country but work with other countries to tackle it. Indeed, it is a matter for some regret that normally when we talk about co-operation on such matters, the debate tends to centre around terrorism and national security. Again, it was the noble Lord, Lord Judd, who made the point that we do a disservice to the public by not being very clear about the benefits to the public of such Europe-wide co-operation. I am talking about human trafficking for slavery and prostitution, drug crime, and money-laundering, in which criminals are trying to hide the ill-gotten proceeds of their activities.
The report helpfully starts with a timescale and a narrative of the sequence of treaties, with an explanation of the issues and priorities. It also deals honestly with concerns about the effective implementation of legislation. Following on from the Stockholm programme, a decision needs to be taken on how to proceed. We also need to discuss and define strategic guidelines for legislative and operational planning in the area of freedom, security and justice. The committee addresses the question of how this should be handled.
The noble Lord, Lord Hannay, referred to the subtitle of the report, Steady as she goes. It seems to me that that very phrase oozes responsibility; it inspires confidence. I have a picture of the noble Lord himself at the helm of a trusty seaworthy vessel: “Steady as she goes”. More seriously, the subtitle indicates the style and tone of the report and its recommendations. The noble Lord joked a little bit about it, but I think it is a very apt and helpful subtitle.
I shall pick up a couple of issues. One that leaps out at me is that of cybercrime. We have debated it in your Lordships’ House recently. Indeed, we are currently dealing with it in the context of the Serious Crime Bill. As noble Lords are aware, I think that the Government’s proposals on cybercrime should have been bolder. When we return to the subject on Report there may be an opportunity to see whether we have got that aspect right and whether more can be done. What strikes me about the whole area of cybercrime and cybersecurity is how fast technology moves, and how quickly legislation—and also our knowledge and understanding of the issues—becomes out of date. I refer back to the debates we had last week on the fast-track legislation on data retention. We were then debating a directive passed in 2009 that has been struck down by the European Court. We also debated the Regulation of Investigatory Powers Act 2000, which deals with intercept capabilities. That legislation is now out of date. It was clear in our debates on it how urgent and important it is that we do not just keep trying to make small changes and “sticking plaster” amendments to it, but have a proper, detailed, thorough review, and try to understand not just the issues we face now but how we might not exactly future-proof the legislation but at least make it easier to amend in order to deal with future developments in technology.
When we are looking at crime and threats in the cyber world, it is not just about Governments. In an increasingly global and technological world, the ability for cybercrime to damage companies and individuals as well as nations—damaging companies can have a huge impact on national infrastructure as well—is a growing threat. The use of technology has now intruded into some of the most heinous crimes. We have heard reports of them in the press involving child sex abuse, and there are new crimes that were not even invented or thought of 10 or 20 years ago, such as cyberstalking and revenge porn. Technology is available to enable new ways of committing offences and crimes against the individual.
The Stockholm programme recognised the challenges, and the European Cybercrime Centre was set up within Interpol in January 2013. There are issues about some of the work that it was doing, but the report highlights comments made at the Europol meeting that I found extremely useful and interesting.
In our debates last week on data retention, very little mention was made of the role of, and information held by, the private sector. Not only does the private sector hold enormous amounts of information about citizens but the advice from everyone in the industry and the recommendation of the report was that far greater emphasis must be placed on closer and more productive co-operation between the private and public sectors. There are common interests. There is a necessity for sharing expertise and good practice. A common theme throughout the report is its emphasis on consolidation and implementation. Specifically when we are talking about achieving that balance, co-operation between private and public sectors is important.
I was slightly disappointed by the Government’s response. If the noble Lord can clarify that, that would be useful. When I read the Government’s response to the committee’s recommendations, I expected to see strong agreement on the need for private and public co-operation on cybercrime. However, the Government’s response seemed qualified. I hope that that is just a misunderstanding on my part, but the Government’s response does not just say, “Yes, we totally agree. This is something we have to do. We want to co-operate. We want to ensure that we find mechanisms and support for public and private co-operation”. It starts by saying:
“As the Committee is aware, the Government’s policy objectives are”,
and then gives a list of policy objectives that do not include cybercrime. Only in the second paragraph does it come on to say, “Yes, we think that that is also an issue”. I would have liked to have seen something stronger to give greater confidence. Will the Minister place on record an absolute commitment from the Government on their determination to tackle cybercrime and ensure that essential private-public co-operation?
Another point to draw attention to in the report relates to serious and organised crime. I am interested to hear the Minister’s comments on that part of the report. It is not a recommendation, but the report draws attention to the point raised by Sir Hugh Orde and Rob Wainwright of Europol that:
“Further action to fight against drugs and radicalisation should also be priorities”.
They were not listed in the Government’s priorities. I am sure that the noble Lord can confirm that they are also a government priority. Rob Wainwright also said that,
“we should be arguing for a much more effective integrated response to organised crime within the EU”.
I hope that the debate that your Lordships’ House and the other place have had on the Government’s proposals to opt out of EU criminal justice matters and then seek to opt back in have not been damaging to our relations with Europe. We take that co-operation seriously.
I welcome the committee’s recommendations in “Chapter 3: Strategic guidelines for the Next Programme”, which include a recognition and acknowledgement that the priorities are implementation of existing agreements and consolidation. That does not mean that nothing new can be considered, but it means that a case must be made. I was certainly interested in the comments that any future programme should be more succinct, targeted and strategic—clearly, we do not want to fall into the trap of being vague or woolly—and have flexibility so that it can respond to unforeseen developments and trends. The noble Lord’s comments on that would be helpful.
Finally, the Government’s comments on passenger name recognition were interesting. The noble Lord, Lord Hannay, also referred to this. It is not the first time that this issue has been raised; it has been raised for a number of years and, indeed, there was a previous report from the EU Committee on this. The Minister says that “good progress” is being made. I hope so. We were very concerned that the e-Borders programme was cut so significantly in 2010. A lot of money—more than £150 million—has been written off by the Home Office. As serious as these matters are, I do not want to go into whose fault it is; what I need to know from the Minister is what is happening, when is it going to happen and whether he can give a progress report on this, because it is crucial if we are to tackle terrorism and serious and organised crime.
I am grateful to the noble Lord, Lord Hannay, and to my noble friend Lord Judd, who is also a member of the committee, for the work they do, and I hope that the Minister will address some of my questions.
The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach) (Con)
My Lords, I join in expressing gratitude to all noble Lords who have participated in this debate; fewer, perhaps, than might be considered enough to do justice to a very thorough report and a serious matter, but of course it is soon after we discussed matters last Thursday evening. I am delighted to see the noble Lord, Lord Boswell of Aynho, in his place. I thank him and, through him, all members of the House’s European committee for their excellent work. They do great service to the House by the diligence with which they study these matters. I thank, in particular, the noble Lord, Lord Hannay. A bit like Frank Sinatra, I cannot imagine that this is his last appearance, but this is, I am sure, his last appearance as chairman of Sub-Committee F. I am grateful to him and to his sub-committee for the work they have done on this report and I pay tribute, along with all noble Lords, to the work that he has done on a whole range of matters. It has been of great benefit to the House in European affairs and I am sure that that will continue. If not as chairman, I am sure that he will still be involved in other ways.
The sub-committee’s inquiry, to which my ministerial colleagues from the House of Commons, James Brokenshire and Shailesh Vara, gave evidence in February, was very thorough. Its subsequent report was of its usual extremely high standard and the Government were grateful for such a well considered contribution to the debate. As noble Lords will be aware, the new strategic guidelines in the field of justice and home affairs were agreed by the Prime Minister at the June European Council. The Government are pleased with the strategic guidelines, which reflect all our key priorities in this area. The Government were successful, as noble Lords will know, in securing a strong and clear reference to the need to tackle “misuse” of free movement and fraudulent claims. We welcome this and hope that it will lead to member states and the Commission being more proactive in addressing cases of fraud and abuse of human rights.
The new strategic guidelines also contain welcome references to the need to strengthen the EU’s external border, in particular through strengthening co-operation with countries of origin and countries used for transit. We were also successful in securing two explicit references to the need for action to tackle human trafficking, which reflect the importance we attach to the fight against modern slavery. Indeed, noble Lords will know that the Modern Slavery Bill is going through its Committee stage in the House of Commons at the moment. This is an area where the EU can and should be ahead of the curve and I hope that, in turn, so can we.
The overall messages of the new guidance are ones of implementation and evaluation of existing measures, and on strengthening practical co-operation rather than bringing forward new legislation. That is in keeping with the general tenor of the committee’s report. In a field where we have seen so much new EU legislation over the past few years, this is welcome. As noble Lords will be aware, the Government place particular importance on the full implementation of the prisoner transfer framework decision by all member states. We welcome the explicit reference in the guidelines to the need to improve cross-border information exchanges, particularly in relation to criminal records.
As noble Lords will know, the Government shared the disappointment of this House that a proper mid-term review of the Stockholm programme did not take place. We are therefore very pleased that we were able to secure a Council-led review mechanism in the new strategic guidelines. I think that was genuinely welcomed by all speakers when they referred to it. This review mechanism will give us an opportunity to work closely with the new Commission, and the current and forthcoming EU presidencies, to ensure that the Council continues to hold the Commission to account as concerns the proper implementation of the strategic guidelines. The Council now has a clear role in ensuring that the Commission’s future actions in this area are in line with the strategic guidelines agreed by the member states.
I will do my best to respond to all the points raised during today’s debate but, as usual, I promise to write to the noble Lord, Lord Hannay, to copy all those who have spoken in on that letter and to place a copy in the Library if there are any that I do not address at this stage.
The noble Lord, Lord Hannay, asked specifically about the implementation of the European supervision order. I can confirm that we are preparing legislation on this matter and I hope that it will be in force by the end of this year. He also asked whether the Government would carry forward raising the proportionality issues and strengthening the yellow card procedure. As we made clear in our response to the committee’s report, the Government would like to see the yellow card mechanism strengthened. We want to have the scrutiny period extended from eight to 12 weeks and to extend the scope of the yellow card mechanism to include proportionality as well as subsidiarity. We also want to lower the threshold at which the yellow card is triggered.
The noble Lord, Lord Hannay, also asked whether the Government will have another look at the idea of a scorecard. I thank noble Lords for their further explanation as to how this matter would work. We will give the committee’s recommendation further reflection.
The noble Lord, Lord Judd, in another of his excellent speeches, referred to Home Office culture and the need to support links in the EU where countries are weak and need support. The UK offers practical support to member states. For example, we have provided a wide range of support to Greece to assist with the implementation of its action plan on asylum and migration. It is obviously in our interests—is it not?—to make sure that the EU borders are secure and properly policed and that we do not have the difficulties at Calais which we do, simply because people have leaked through what should otherwise be secure borders.
It was nice that my noble friend Lord Maclennan of Rogart was able to speak in the gap. He asked whether the budget was adequate for work on drugs, particularly for the European Monitoring Centre for Drugs and Drug Addiction. The UK benefits considerably from the information we receive from the EMCDDA; but, as with all these negotiations, this Government have stressed the importance of budget discipline. That means that EU agencies must operate within their budget. We are satisfied that they can still do good work within that budget.
The noble Baroness, Lady Smith of Basildon, asked me a number of questions. I will do my best to answer what I can now but I will be writing to the noble Lord, Lord Hannay, as I have said, and if she does not mind I shall copy her in on that. It is a good way of making sure that everybody knows the answer.
The noble Baroness was concerned that the Government were not sufficiently focused on cybercrime and co-operation between the public and private sectors. I am surprised at that, given that whenever I speak I try to make it clear that we see it as a very serious issue. We fully support programmes that bring together the public and private sectors to share information on threats and to take co-ordinated action against them. I am happy to confirm on the record that we seek co-operation on cybercrime matters across a whole series of things, not just matters of security or even serious crime, but beyond to domestic incidents of cybercrime, which aggregated together can become very serious crime very quickly.
I am pleased that the noble Baroness noted that the report was helpful, informative and useful. I agree with her; I felt that the report did justice to the issues. I agree with her also that crime does not stop at Calais and that there is a need for European-wide co-operation in dealing with crime. I hope that she can be satisfied that when we discuss the Serious Crime Bill on Report these matters can be made clear in debate. There is no conflict between the Government’s policy on the matters contained within the report and our policy in legislating here within the UK.
I hope that noble Lords will be happy that I will write to the noble Lord, Lord Hannay, on the points that have been made and not answered in the debate.
Lord Hannay of Chiswick
My Lords, I thank all noble Lords who have taken part in this reasonably short debate. In particular I thank the Minister for the considered way in which he has responded to all the questions that were asked. I am delighted that he will have another look at the scorecard idea.
I have two points. The point made by the noble Baroness, Lady Smith, about the importance of the way that crime is dealt with in other member states as being part of our national security is one that is not terribly well grasped. The noble Lord, Lord Judd, made that point, too. In the world we now live in, with a highly integrated European market, the fact is that the criminals are half way down the track before we have left the start line. Measures of co-operation of the sort we have been debating are the way in which we are going to catch up with them and, it is hoped, get ahead of them and catch them—because these things often happen elsewhere than in the UK, but then the criminals come here and continue their activities. There are many ways in which these cross-border crimes continue. The noble Lord and the Government have got the balance about right now and I hope that this will lead to what I was delighted to see was a commitment to Britain’s membership of the Justice and Home Affairs Council that goes beyond the fatal date of 2017. That was a welcome sign indeed. I hope that when the Protocol 36 negotiation is finally concluded—successfully, we must all hope—the Government will again become, after a year of necessary negotiation, a full participant in this field to which we have contributed an enormous amount over the years, and from which we have gained a large amount.
Women: Equality and Advancement
Baroness Hodgson of Abinger
To ask Her Majesty’s Government what assessment they have made of the role of the United Nations Commission on the Status of Women and its impact on gender equality and the advancement of women in both national and international policy.
Baroness Hodgson of Abinger (Con)
My Lords, the UN Commission on the Status of Women, known as CSW, first met in 1947, soon after the founding of the UN. Its work forms a close and long-standing relationship with a number of NGOs and civil society, and it advises the UN Economic and Social Council, known as ECOSOC. Throughout its history, CSW has been supported by various UN bodies. In 2011, all these bodies—DAW, INSTRAW, OSAGI and UNIFEM—merged to become UN Women. This now functions as the secretariat to CSW and, thankfully, is much less of a mouthful to pronounce.
From its inception, CSW forged new ground in its global assessment of the status of women and helped to draft the early conventions on women’s rights, including those on political rights, marriage and equal pay. The 1960s saw CSW draft the Convention on the Elimination of All Forms of Discrimination against Women: CEDAW. However, it was not until 1972, CSW’s 25th year, that it held its first World Conference on Women. For the past seven years, I have attended CSW as a delegate—as an NGO delegate and this year as a parliamentary representative—and it is this experience that prompted me to table this debate.
CSW is the second-largest meeting of the year held at the UN. This year, 6,000 delegates from around 850 organisations from all over the world registered. While sometimes referred to as the “Davos of Women”, unlike Davos it is hardly ever mentioned in the UK press and is little known to members of the general public. Each year, the conference is structured around a central theme, with a review theme also considered. Draft conclusions on the theme are published in advance and are then negotiated during the conference, hopefully culminating in agreed conclusions. I say “hopefully” because, two years ago, conclusions were not reached. This was somewhat of a wake-up call and an issue I will return to later.
UN Women is mainly funded by voluntary contributions from countries. I am pleased to say that the UK has so far funded UN Women to the tune of more than $10 million this year, the fourth-largest core contribution to date. Contributions are also raised by UN Women’s national committees and, last year, the UK committee sent an additional $66,020. Although unheard of by the wider public, CSW is well represented from the UK. This year, over 80 representatives from civil society and NGOs attended, as well as three Ministers and parliamentary representatives. I should like to put on the record the huge value and import of the work put in to support the UK at CSW by the UK Gender and Equalities Office—the GEO—so ably led by Helene Reardon-Bond. One of its roles is to liaise with civil society, and its work for CSW starts months before, when it convenes stakeholders to consult them on the theme.
Preparatory work is done in advance not only by the Government but also by the NGOs. For the past two years, there has been a UK NGO CSW Alliance convened by NAWO. The alliance, the INGOs and others send in briefings and also comment on the CSW draft conclusions, so the Government are very aware of the views of UK civil society. Once at CSW, the UK NGOs are the envy of the NGOs from other countries because of their relationship with the Government. A meeting is convened most evenings at the UK mission during the first week to brief delegates. We are very lucky in this country not only to have a Government who put so much work into CSW, but also to have such a committed civil society. I thank all those government officials for the effort they put in to try to ensure the best outcome from CSW, and also the NGOs which play such a sterling role, including backing up the negotiations by lobbying member states. Without doubt, it is of immense value to have an annual UN conference in the pursuit of gender equality. CSW has been a pioneer in influencing positive changes internationally.
This year’s conference was focused on the post-MDG agenda. Not only were significant issues not in the original MDGs, such as violence against women, highlighted, but the agreed conclusions also endorsed the imperative need for a stand-alone gender target and for gender to be mainstreamed. The issue of unpaid care work, first raised at CSW, now appears in the working document of the Open Working Group on Sustainable Development Goals. So CSW continues to play an important and vital role in pushing for gender equality.
However, I cannot help but feel that in these times CSW misses opportunities and could achieve so much more. My experience as a delegate is of a conference of two halves. While in the UN building member states are making their statements on achievements in their countries, across the road, in Church House, the NGOs are holding meetings which, in some cases, challenge their Governments’ assertions. There is very little interaction between the two. Perhaps more global progress could be made if there were more opportunity for transparent and informed discussions between the Governments and their civil society delegates.
When CSW took place this March, the headlines were full of crises in Syria, Afghanistan and Egypt, yet the CSW failed to make any statement on these issues or to highlight the horrific plight experienced by women in those countries: women being raped in Syria; refugees fleeing with their children; and the terrible fear of women in Afghanistan as the West withdraws its troops. Some might even go as far as to say that this was a failure to speak up. We cannot truly seek long-lasting and positive changes in gender equality in isolation of global events. A statement from CSW, supported by 6,000 women from around the world, would have had some clout.
It is a sad indictment of our times that the call for a fifth women’s world conference has faded away, not due to lack of interest but, rather, out of concern that, in recent years, there has been such a struggle to maintain the language of the last one, the almost 20 year-old Beijing Platform for Action.
I mentioned that two years ago there was a failure to reach conclusions. This had a domino effect throughout UN language and other agreements that look to CSW. Every year, basic rights that we here take for granted and are the cornerstone on which to build gender equality—especially sexual and reproductive rights—come under fire and a huge effort has to be made by activists at CSW just to hold the line, rather than progressing debate and action. For example, issues such as intimate partner violence are not addressed, because fundamentalists feel that to include this language is to condone relationships outside marriage. But IPV is a sad reality of our times and we need to be able to ensure that the expert voices at CSW are able to be loudly raised in the negotiations.
So I feel that I must ask your Lordships whether you think that CSW could be more effective. Can the Minister please inform me whether assessment has been made of its impact, nationally and internationally? How can we make the work and outcomes of CSW more accessible to wider audiences, those outside our CSW geeks, who do not fully understand how the sometimes dry language in the outcome reports can relate to them and what it means in practice? Surely, raising awareness should be a major outcome of CSW. Statements on burning topical issues would make headline news around the world and perhaps contribute to getting countries to campaign to stop some of the abuse.
We should be enormously thankful to have a global UN conference for women. Indeed, it is vital. I have said before that I am hugely grateful to the Government for all their diligent work for CSW. However, the present CSW structure seems to offer little room for swift movability and flexibility. From time to time, most institutions benefit from a little restructuring and a fresh approach. As David Cameron said in January, Britain is “leading the charge” to promote equality for women around the world and our Government should be applauded for all that they are doing. Following the enormous success of last month’s Global Summit to End Sexual Violence in Conflict, and the wonderful Girl Summit today, together with the wider work the UK is leading on to end violence and gender inequality, would this not be a good opportunity for the UK—one of the key financial supporters and core members—to work with other founders to make CSW more effective and its impact felt more forcefully at national, European and global levels?
I thank noble Lords for giving me this opportunity to raise the issue of CSW today and I am looking forward to hearing contributions from those taking part and the response from my noble friend the Minister.
Baroness Nicholson of Winterbourne (LD)
I thank the noble Baroness, Lady Hodgson of Abinger, for her stirring and powerful speech on the UN Commission on the Status of Women and work arising therefrom. I am pleased and reassured today to learn of Her Majesty’s Government’s new determination to tackle the double trauma of female genital mutilation and of forced, underage marriage for girls.
The Birmingham Trojan horse report, which your Lordships’ House received this afternoon, brings both crimes against young females inside the orbit of a narrow band of extremely restrictive Islam. Undoubtedly, from the evidence so painfully experienced, the cruel actions that result from forced marriage and FGM can—and do—claim that Islam’s teaching provides full justification for these brutal practices on helpless children. Indeed, the claim is regularly made that Islam not only authorises but demands them. Evidence of the strength of this view in some Muslim countries is easy to come by. Under the immediate past Egyptian President Morsi, ambulances with cutters roamed the streets, loud-hailing families to “bring out your girls”. Under Morsi’s brief reign the percentage of girls under five who were assaulted by bloodstained adults and had their genitalia sliced away without anaesthetic rose from 83% to over 90%.
Where is the verse in the Holy Koran that dictates such bloody and continuing sacrifice to Allah? It cannot be found, for it does not exist. What of the Hadith? Compiled some 400 years after the founding of Islam, the Hadith offers further Koranic interpretation, but there is no mention there, either, of child marriage or female genital mutilation. Therefore we must deepen the search and track back easily the FGM genesis from its common name; it is known as the “pharaonic practice”. There we have it—this was an ancient Egyptian custom, which perhaps predated even the union of Upper and Lower Egypt in 3000 BC or so. Therefore the evil that we tackle today is theologically unconnected with Islam or with any true Muslim practice. Instead, it is a vicious torture practised by certain societies to dominate their women by the use of carefully targeted and deliberately inflicted bitter and lifelong pain.
By no means all Islamic countries practice FGM. The Islamic Republic of Iran, a country I know well, allows none of it, and nor does her neighbour, Iraq. The pharaonic practice failed to spread far in the Arabian peninsula and the Persian Gulf, but its proponents from Egypt and parts of the neighbouring countries have successfully brought it to western nations, including —to our great shame—the United Kingdom. Today, our Government declared their wish to eliminate those practices from the British Isles, and from the globe, but how best to tackle FGM and its unhappy sister, forced marriage at an early age? A further horror to add to make up the trilogy of hatred for women is the concept of honour killing—another misery for young girls to fear and suffer. So there is much to do.
My own findings on tackling successfully these unhappy issues come from my grass-roots experience around the world. Small achievements led to my setting up and working through the AMAR International Charitable Foundation and Asociatia Children’s High Level Group. AMAR is a large charity that works exclusively in the Muslim world; Asociatia Children’s High Level Group is a smaller NGO that tackles the same problem of exclusion in the very different Christian Orthodox settings of central and eastern Europe. There, inside the boundaries of the European Union, a section of society persistently practices marriage of underage children, most often to older men, which it claims is an ingrained custom that will not be denied.
These practices are neither Christian nor Muslim. The UN Convention on the Rights of the Child makes that plain. All nations have signed and almost all ratified or incorporated that most powerful of all UN conventions. Those community leaders who insist on child marriages, honour killings and female genital mutilation can now be persuaded, through an understanding of the convention’s articles, that their customs are outdated, irrelevant and destructive of the very same communities that they lead.
For example, the AMAR Foundation, which I chair, has worked in the Mesopotamian marshes, serving the marsh tribes, for 23 years now and continues to do so. Historically, the people of the marshes have carried out a small number of honour killings every year. As they track their ancestry to Sumerian times, the numbers of dead young people mount dramatically. By careful persuasion, explanation and teaching by AMAR staff over some years, these tribal leaders have discarded honour killings completely. In place of the blood revenge for the stain on family honour, AMAR and the tribal leaders have created a new deal of water buffalo, clothes and food—a huge achievement that the 300,000 tribal people highly appreciate.
AMAR has approximately 2,000 staff and works through capacity and institution-building in health and education across Iraq, from north to south and east to west. AMAR works in close partnership with central and local government in the KRG region. It now additionally serves the recently internally displaced people from Mosul and refugees from Syria, giving a catchment area of those whom AMAR cares for in the millions.
Some years ago, the AMAR teams planned and began work on gender-based violence. This great programme started in the Kurdistan Regional Government area in the north and is now countrywide. It successfully combats gender-based violence throughout Iraq by promoting a cultural discourse on gender. The programme provides protection against gender-based violence through support, training, outreach and publicity. AMAR professional staff give direct and social assistance to GBV victims through eight special centres in seven of Iraq’s 18 governorates. Through the creation of special GBV training workshops, AMAR’s team has now trained 1,000 police and 109 local NGO staff.
In-house lawyers have referred and handled nearly 2,000 cases of GBV, and thousands of students and schoolchildren, their teachers and professors are trained each month. By March this year, nearly 7,000 school classes, 3,000 classes in universities and 5,500 public workshops had been successfully delivered. There was continuing publicity of this groundbreaking two-year project through mainstream media and through the production and distribution of a monthly bulletin. These are the practical, core building blocks that I recommend for the creation of an enlightened society that does not inflict cruel and inhumane punishments on defenceless children and powerless women in imagined retribution for the ill luck that is assumed to have created the community’s poverty, alienation and distress.
The GBV programme’s focus on women’s empowerment and gender equality is matched by AMAR’s other projects for women across the nation. A network of 500 AMAR women health visitors visit more than 3,000 families each month as a part of the foundation’s comprehensive women and reproductive health programmes, which are carried out through 50 primary health centres in six governorates. The human rights and rule of law programme gives thousands of women key knowledge of basic rights and helps them use them. All this work meets the professional standards of the WHO and UNESCO, and is based on the UN conventions that today’s conference here in London, led by UNESCO and supported by Her Majesty’s Government, demonstrates so well. AMAR’s work takes place in the Islamic world with mainly Muslim professional staff, giving the lie to claims that the abuse of women is an Islamic requirement.
I strongly support our Government’s initiatives on gender-based violence, on female genital mutilation and on arranged marriages. I know that they will succeed. We in the AMAR Foundation stand ready to share our deep and powerful experience, which is succeeding.
Lord Patel (CB)
My Lords, it is a pleasure to take part in this debate initiated by the noble Baroness, Lady Hodgson of Abinger, particularly when, as the only male Peer to be speaking, I am in the company of such distinguished noble Baronesses. Yesterday, I asked the noble Baroness, Lady Bottomley of Nettlestone, what I should speak about. In her usual forthright and direct way, she said, “Speak about men”. When I first met her when she was Secretary of State for Health, that was how she dealt with me then too. It is a pleasure to see her.
I was delighted to hear the noble Baroness, Lady Hodgson, speak about her experiences on the CSW. It was informative but I was disappointed to hear that she felt that the CSW could do more than it had been doing. Having read the annual reports, including the most recent one, my impression has always been that the CSW was the driving force behind making sure that the MDGs progressed and achieved the outcomes described. I always believed that it was the CSW that made that happen, and I hope that that is the case.
As we have already heard, today in London we have had the Girl Summit, supported by UNICEF. The Prime Minister and the Deputy Prime Minister both made speeches on the elimination of FGM in our generation. The summit also addressed child marriages. We all know that female genital mutilation is violence against girls. It is child abuse.
I am going to speak about some of these issues but in the context of some of the millennium development goals. I shall reflect on the meetings that I recently had with some remarkable women in Africa and in this country. The story I am going to tell your Lordships about concerns a young lady whose name is Talanesh. I am involved with a charity in which I work to set up centres for the management of women with fistulas and to provide training for local doctors and nurses, teaching them how to repair fistulas to relieve women’s suffering.
Talanesh’s story—I saw her recently—is that at the age of 12 she was betrothed to a much older man. At the age of 13 she was married. At the age of 15 she became pregnant. She had a long labour lasting four days in a remote part of a mountainous region, and she delivered a dead baby. She was relieved because her pain and suffering had ended. Little did she know that two days later she would discover that she was wet all the time. She realised that something was wrong. She smelt, and her husband left. Her parents took her back but, because she smelt, she could not stay in their small hut, so she stayed in a separate one. Years later, the family discovered that it might be possible for her to be treated. They undertook a four-day walk—all this is absolutely true—to reach a hospital, where she was looked after and her fistula was repaired. She is now dry and has her dignity back.
Two million young girls are affected in this way. They are married early in their childhood when their pelvis is not developed. They become pregnant at a very young age and are lucky not to die in obstructed labour, but they end up with fistulas—sometimes double fistulas—and the tragedy is enormous. Some of them have had female genital mutilation carried out, which produces further problems in pregnancy. In sub-Saharan Africa, 250 million are married under the age of 15. Michelle Bachalet has called child marriage a violation of a girl’s human rights. It halts education and produces the health risks that I have just described. If we end child marriage by 2030, it will make it easier to deliver six of the eight millennium development goals.
The second lady I met was called Leymah Gbowee. Most noble Lords will probably have heard of her. She is Liberian and in 2011 she was the joint winner of the Nobel Peace Prize for helping to stop the second violent war in Liberia. In the context of rape and violence, she was once asked to speak in Libya. She thought that she would be making the speech to women but found that 98% of the audience consisted of men, so she changed her speech. Her key topics were: acknowledge that there is inequality; help to promote working partnerships; and protect the victims of violence and rape. She told me that she suggested that women who were raped and then had a child ought to have legislation allowing them to choose the name of the father on the birth certificate, otherwise the child would not have a father’s name. I understand that Libya is the only country that has such legislation.
She told me something else that was very interesting. She saw rape and violence in a conflict situation as merely an extension of the violence, with a greater brutality because of the presence of weapons and the hype related to war that legitimised greater brutality. It was the same violence against women that existed in normal life outside of war. I thought that that was very telling. She made that speech in London.
However, there are other gender inequalities. I went to a school recently on the same visit when I met Talanesh in Africa. I was bitten badly by tsetse flies. I hope that none of them will infect me, but if noble Lords notice me dozing off it is a sleeping sickness. The school I visited was a secondary school. I thought that it was a boys’ school. It was a mixed school—I saw some girls afterwards—but because it was a secondary school there were very few girls there. I was told that they mostly leave after primary school. That is the problem. They have to pay a small fee, so the parents decide that they cannot afford it. Primary education is free but secondary education costs a small fee. We have to address that issue in the aid that we give, particularly as we will now have a law in this country that all our aid should be based on gender equality. We should promote gender equality in education, too
I believe that the UN report is right. The indicators monitoring the outcomes of MDGs are not desegregated by sex and other factors providing information about the situation of women and girls, so it is not possible to say whether gender inequality is being properly addressed. I hope that we will promote that. I also hope that the next goal, beyond 2005, will be a stand-alone one on gender equality underpinning all other goals. I hope that the Government will support that.
Baroness Bottomley of Nettlestone (Con)
My Lords, I am honoured to follow the noble Lord, with whom I have worked over many years. He may be male but no one can say he is stale or pale, and on that basis he is welcome as part of the debate. He was, of course, president of the Royal College of Obstetricians and Gynaecologists during the time I was in government, and we all welcome his enlightened and practical approach. I also commend his work as chancellor of the University of Dundee; I shall say a little more in a moment about Hull, where I am the chancellor. I also warmly congratulate my noble friend on raising this critically important subject.
I feel as though my lifetime has coincided with the Commission on the Status of Women, as it was started a year before I was born—my birthday is in March. I remember only too well when we finally got the Convention on the Elimination of Discrimination against Women; the International Women’s Year in 1975, when I was a magistrate and working in a poor area in south-east London; and the Declaration on the Elimination of Violence Against Women. The CSW is also about the promotion of gender equality and the empowerment of women. It is about participation and leadership at all levels and the encouragement of women and girls in education, training, science and technology. It is not only about an element of prohibition but a sense of promotion.
It was well said that, in many ways, last week was a great week for women, with the reshuffle and a remarkable number of women joining the Cabinet. For the first time we have a woman Leader and a woman Chief Whip in the House of Lords, and any number of other appointments over the last year which quite took me aback. We have Janet Yellen at the Federal Reserve in the US, the IMF managing director Christine Lagarde and the German Chancellor Angela Merkel. Time and again, we have had female firsts. That is a cause for celebration but it certainly is not sufficient.
When we look at the evidence of what is happening around the world we are witnessing extraordinary polarities. In the UK, as in the US and Hong Kong, female life expectancy is now 82 and has virtually doubled in 150 years. It is quite extraordinary what has happened to women and their health and well-being in the UK. However, in Sierra Leone, the Congo and Swaziland, women’s life expectancy is under 50 or hovering around 50. There is an appalling and unsustainable gap.
There is a similar picture with maternal mortality. In the UK, something like eight women die out of 100,000 live births. The figure in Sierra Leone is what it was in the UK 300 years ago—1,100 out of every 100,000 births are fatal—and the figure is only slightly lower in Chad, the Central African Republic and Somalia. In Sudan, the Congo and Côte d’Ivoire, the figures for women dying in childbirth are the same as they were in the UK 200 years ago. The issue of female health and reproductive medicine is extraordinarily serious and particularly intolerable as the disparities in different parts of the world are so strong. It is a similar story with perinatal mortality rates. Fortunately, in the UK it is very rare now for a child to die at birth, about eight out of 1,000, but it is five times that figure in Pakistan and many other countries. We cannot be confident until we have tackled those issues.
Much of this, of course, goes back to literacy. I remember long ago when I was PPS to my noble friend Lord Patten, when he was the Minister for Overseas Development. I commend particularly the work of many women who have held that job. The noble Baroness, Lady Chalker, was at ODA, as was Clare Short, and now we have Justine Greening. Women in that role can make a particularly powerful contribution. Whereas in the West 100% female literacy is expected, in Afghanistan it is 12%, in Niger 15% and South Sudan 16%.
This refers back to the noble Lord’s point about schooling. One of the millennium development goals is to achieve universal primary education. In Uganda, the number of girls getting to the last grade of primary education is one in four—25%—while in Angola it is 27%, in Mozambique 29% and in Ethiopia 42%. In many countries, fewer than 50% of the girls get through to the last grade of primary school. This is an extraordinarily serious issue. Taking up the comments of my noble friend when she opened the debate, I believe that these are specific, practical issues which must be addressed. They cannot be avoided or ducked.
I return to the issue of evidence. I feel very privileged to be involved in the University of Hull, and of course William Wilberforce was born in Hull. During his pioneering work on the abolition of slavery, he said, rather wonderfully, that:
“You may choose to look the other way but you can never say again that you did not know”.
We must address this, not only in this House but at the UN. We cannot say we did not know. We do know these facts and this evidence. Amusingly, William Wilberforce was highly criticised by some other humanitarians at the end of the 18th century. Elizabeth Heyrick and others regarded him as extremely unenlightened about the role of women and not very interested in the issue of poverty at the time. However, such is the way of social reform.
At the University of Hull, there is a particularly impressive centre for gender studies. It was the first UK university to have a mainstream department for the subject, building on the legacy of the Wilberforce Institute for the Study of Slavery and Emancipation, which has recently developed a slavery index, suggesting that there are still 29 million in slavery in the world, so many of whom are female. The work at the centre, particularly that led by the most impressive Dr Suzanne Clisby, suggests that the evidence on abuse against women is still far from reliable. There has been a survey of 42,000 women across the EU and the evidence of self-reported, compared to reported, violence is hugely different. Until we can have reliable and accurate information, we cannot seriously develop effective programmes.
Apart from the issues in Europe, there are still harrowing situations in different parts of the world. In Haiti, there is an appalling situation where many of the older women lure children and young girls into people trafficking. Because they are older, grandmotherly types, the girls often feel they can trust them. Families give up their girls and young women into slavery, believing this will lead to a better life. In Mauritania in west Africa, there is deeply entrenched hereditary slavery and child marriage and human trafficking are a particular burden on women. In Pakistan, there is a very serious situation of slavery and exploitation of women. Another research project conducted by the University of Hull in Bangladesh concerned women on construction sites carrying rubble, cement and bricks to earn money. They are then cast out by the community because they are changing the norms of purdah. They are vulnerable to exploitation, and sexual difficulties are only too evident.
Finally—this relates to the noble Lord’s point about children in school—some work in Ghana is trying to avoid gender-based violence prevalent in the secondary schools there, where girls are often raped and abused both by male staff and by male pupils. They have to drop out of school because of pregnancy or shame or have to walk long distances to school, again being picked up by predatory men. There are schools where there are very few toilet facilities where the girls can have any privacy.
The situation around the world is extraordinarily ambiguous. I always take India as an example, where there is a 65% female literacy rate but, unlike anywhere else in the world, in India there are 10 female chief executives of banks, which is quite extraordinary. It is that contradiction that makes it all the more difficult for the international institutions to provide coherent programmes.
My noble friend talked about raising the status of CSW. She talked about NGOs, civil society and Governments. I believe that to achieve change in the world there is a very potent force that can be used to hugely positive effect, and that is the role of business. The global brands take the issues of corporate social responsibility, avoiding female exploitation, developing female health facilities and encouraging literacy in enlightened workplaces extremely seriously. If you talk to the people at Standard Chartered, Tesco, BT, BAT or Coca-Cola—many, many businesses—they can be a far greater force for good in many of the countries facing the most difficult circumstances than can their Governments, with all the difficulties that they face.
I warmly congratulate my noble friend and, like others, I am pleased about progress so far, but we are left with a vast amount more to do before the women of this world can live to have the expectations that they rightly deserve.
Baroness Jenkin of Kennington (Con)
My Lords, I am grateful for the opportunity to speak briefly in the gap.
As we are all aware, this year’s UN Commission on the Status of Women focused on the challenges and achievements in the implementation of the MDGs for women and girls. I wish to draw attention to its conclusions that relate to the progress towards MDG5, which is improving maternal health, and its two targets, which are reducing maternal mortality and achieving universal access to reproductive health. Work towards this goal and its targets has been particularly slow and uneven, especially for the poorest and rural sectors of the population within and across countries.
The number of preventable maternal deaths continues to be unacceptably high and adolescent girls face higher risks. Up to 343,000 women die each year in pregnancy and childbirth or soon afterwards, the majority of them in Africa and south Asia. Every minute of every day, somewhere in the world a woman dies from complications related to pregnancy or childbirth; 99% of maternal deaths occur in the developing world, making maternal mortality the health statistic with the largest disparity between developed and developing countries. For every woman who dies, at least 20 more suffer complications that leave them with lifelong disability and pain. Most of these deaths, disability and long-term illnesses are preventable.
The APPG on Population, Development and Reproductive Health, of which I am a member, produced a report in May 2009 entitled Better Off Dead?, which highlighted the devastating suffering and injury following childbirth that leaves women isolated, frequently abandoned by their husbands and excluded from economic and social life as a direct result of pregnancy and childbirth—as was so well described by the noble Lord, Lord Patel. As many as 215 million women in the developing world want to delay or avoid pregnancy but do not have access to modern family planning methods.
Increasing access to modern family planning could prevent up to 30% of all maternal deaths and 20% of newborn deaths. The risk of a woman dying as a result of pregnancy or childbirth is about one in 30,000 in Sweden and about one in six in Afghanistan. Worldwide, as many as 50% of pregnancies are unplanned and 25% are unwanted. The unwanted pregnancies occur disproportionately among young, unmarried girls who lack access to contraception. Unless women and girls’ family planning needs are addressed, gender equality, the empowerment of women and the realisation of the human rights of women and girls cannot be achieved.
I congratulate our Government on hosting today’s landmark Girl Summit. I am proud to be a board member of UNICEF UK, which co-hosted the event. The aim is to end female genital mutilation—cutting—and child or forced marriages, which have been neglected issues for too long. Home Secretary Theresa May and International Development Secretary Justine Greening have together led today’s summit, alongside heads of state, survivors and charities.
In England and Wales, an estimated 66,000 women are living with the consequences of female genital mutilation—an illegal cultural practice where girls’ genitalia are cut—with more than 20,000 in this country at risk every year. I am delighted that the Government have announced measures on how we can change this here.
I was very pleased to attend this afternoon’s session and was impressed by the tremendous commitment and energy from so many enthusiastic, passionate young people determined to eradicate this barbaric practice. If that energy, enthusiasm, passion and commitment could be bottled, many of today’s global problems really would be a thing of the past. If these young women stay involved, maintain their passion and go on to lead their countries, the world has a brighter future than it seems to today.
As someone who has not attended the CSW, it may not be for me to criticise the fact that its work is not better known, when so clearly it should be. Better awareness would lead to higher impact. At a time when so many women are suffering in dreadful circumstances across the world, as described by noble Lords today, the CSW should be leading the way, shouting from the rooftops about the many and terrible injustices that are taking place. I hope that this debate, so ably introduced by my noble friend Lady Hodgson will help in some small way to encourage those decision-makers at the top to look again at its activities and see whether and how they could become more actively responsive to the many challenges women experience on a daily basis.
Baroness Thornton (Lab)
My Lords, I congratulate the noble Baroness on the subject of this debate and indeed on her speech. I followed with interest the discussions and debates that took place earlier this year at the Commission on the Status of Women. I am impressed indeed by its strong outcome. I would like to congratulate the noble Baroness as a delegate to it.
I suspect and imagine that there were some serious and frank discussions that took place at the time. Indeed, I have heard some accounts from the NGOs that were present. The document that resulted, for example, makes specific references to uphold women’s sexual and reproductive health and rights; there was an agreement to eliminate harmful practices, including child marriage and female genital mutilation, which, significantly, would in future not be referred to as “cutting”. There were also explicit references made to a woman’s right to access abortion services and for the development of sex education programmes for young women. And there was strong language around violence against women and girls. The document called for the elimination and prevention of violence and for the prosecution of perpetrators.
The Vatican was present at this convention and would certainly have much preferred that our fight against HIV/AIDS was done on the basis of abstention and not the use of condoms, but I am happy to say that its view did not prevail. The document also called on Governments to address discriminatory social practices, laws and beliefs that undermine gender equality. Efforts to weaken calls for increased funding were successfully resisted.
Françoise Girard, president of the International Women’s Health Coalition, said:
“By committing and investing in efforts to promote gender equality, governments can unleash the power of half the world’s population to build a more peaceful, just, and sustainable planet”.
She went on to say:
“Agreement to a standalone goal on gender equality was not a foregone conclusion here, given the small, but very vocal conservative opposition to women’s rights. It’s a major step forward to have the commission agree to it”.
Shannon Kowalski, director of advocacy and policy, added:
“The commitments made by governments at the UN are an important victory for women and girls. We have achieved what we came to do, against great odds and the determined attempts by the Holy See and a few conservative countries to once again turn back the clock on women’s rights”.
We should be proud as a country that this Government—and indeed my own Government—have been leading the world in the fight against FGM and violence against women. I would like to congratulate the Government on the two summits that have taken place in the last month or so—today’s and the one about violence in conflict. Both of those are very, very important.
I think that it is a great shame, but expected, that any mention of sexual orientation was removed from the final text of these considerations, as was an acknowledgement of the diversity of families. I hope that the UK Government will continue to push for these issues at the CSW in future.
The Commission affirmed that gender equality, the empowerment of women, their enjoyment of their human rights and the eradication of poverty are essential to economic and social development, and reiterated the importance of women in the progress to deliver the millennium development goals, as the noble Baroness and other noble Lords said in this debate.
I want to turn to our domestic performance, because the subject of this debate is not just international policy but our national equality policies and what impact they have. What of the UK? What progress are we making and in which areas?
I looked at the Fawcett Society’s global gender gap report from last year. Unsurprisingly, as a privileged, developed western democracy and a rich country, we scored overall rather well: 18th out of 136 countries, although we have dropped from ninth in 2006. Where we fall down is in some of the gender gap indexes to do with matters such as economic participation, childcare and political empowerment. Those seem to be the areas which have to be addressed by the UK Government.
Out of the 136 countries, we rank 70th for the gap between men and women on the professional index. This reflects the lack of women in top jobs across the piece. We are 49th in terms of wages equality between men and women. On childcare, we are 90th. We know the reason for that and that the matters are linked—the level of women’s economic participation and the availability and cost of childcare in the UK. My honourable friend Lucy Powell today issued a notice about the cost of childcare as we head into the summer holidays. It is worth looking at that as an example of the situation that we face in the UK. The cost of holiday childcare has increased by 16% since 2010—that is an extra £100 per child for an ordinary family. The cost of private, voluntary and independent holiday provision has gone up four times faster than wages, and is greater than that in places such as London. It is a great shame that more help is not available for women and families with their childcare. Childcare help with tax credits has been reduced, with some families losing £1,500 per year of help.
I turn to political empowerment. We rank 59th for women in ministerial positions—that was last year, so the position may have changed slightly—and 54th for women in Parliament, 23% of our MPs being women. Sixteen per cent of those are Conservative women and 14% are Liberal Democrat women. Despite what the noble Baroness, Lady Bottomley, said, it is a fact that 13 out 85 policy tsars appointed since 2010 are women. Less than a third of those appointed to sit on departmental boards in Whitehall are women; fewer than one in five ambassadors appointed since 2010 are women; and only around a quarter of the Permanent Secretaries are women. When David Cameron reshuffled his Cabinet last week, he increased the number of women in it from three to five. In 2011, the number of women in the Cabinet was five, so there has been no improvement in real terms. If one includes the women who can attend Cabinet, the figure increases from five to eight.
It seems to me that the Prime Minister contributed to hitting two out of the three equality indicators all on his own last week with his reshuffle. I put it to noble Lords: what would you say to the boss who appointed a woman to do a job that a man had been doing but paid her significantly less and downgraded the seniority of the position? Let us think about it for a moment, and transfer that action to Marks & Spencer or to some of the companies that the noble Baroness, Lady Bottomley, mentioned, or indeed to a new head of the United Nations. It is less than impressive and a slight on someone who does not deserve it and has acted only with dignity and grace throughout, but it tells us something about the mindset of the Prime Minister and his Government.
I wonder what the Minister thinks the UK’s ratings will be in these matters next year. Will the burden of childcare costs be lifted? Will the Government bring more pressure to bear on companies in relation to the lack of women at senior levels? Will they bring forward more transparency? Will we find more women Permanent Secretaries or ambassadors? And, although it is a bit late to do this, will the Conservative Party select more women in the safe seats? Indeed, will the Liberal Democrats do the same? Then we will be able to increase the number of women in our Parliament.
Baroness Jolly (LD)
My Lords, this has been a fascinating debate. Looking at the list of speakers, it is not the least bit surprising that it has been so well informed and interesting. I am pleased to be here to answer this Question for Short Debate on the Commission on the Status of Women, which I shall refer to as CSW, if noble Lords will excuse me. The UK Government are committed to improving the lives of women and girls both nationally and internationally, and prioritise the advancement of women’s rights.
The Prime Minister has called for a special focus in 2014 on ending violence and discrimination against women and girls. We have heard today about two excellent conferences that have been held in short order on those issues. It has been an aim of the Foreign Office to address the greatest challenge of the 21st century—women’s full political, economic and social participation. We work tirelessly at both national and international level to improve the rights of women everywhere, and our involvement at CSW is one way to do this.
CSW is the primary forum of the United Nations for promoting gender equality and the human rights of women and girls. As such, participating in its annual meeting allows the UK to display leadership in gender equality, to campaign for women’s rights on a global stage, and to use its outcomes to inform our national and international equality policies. Our strong commitment to CSW demonstrates our belief that it is a crucial element in the campaign for global equality. We send a strong delegation each year. My noble friend Lady Hodgson of Abinger attends regularly, and this year three Ministers attended—the Minister for Women and Equalities, the Secretary of State for International Development and the Parliamentary Under-Secretary of State for International Development. I know that it is already in the diary of the Minister for Women and Equalities for next year.
Another strength of CSW is the role that civil society plays. My noble friend Lady Hodgson made that clear during her speech. Civil society organisations from around the world attend CSW to represent their constituencies and lobby member states. In the UK we have a very good relationship with our NGOs. We meet them regularly in the run-up to CSW, including at ministerial level. This helps to inform our position and our negotiating objectives. At CSW it is wonderful to see civil society come together from around the world, with people sharing their stories, their plans and their aspirations. Thousands of women from around the world come together at CSW: our own NGOs are well represented, and many hundreds of women from the UK attend.
CSW is co-ordinated by UN Women. We are fully supportive of the work of UN Women and were, until recently, its largest donor. CSW provides an opportunity to encourage support for better representation of women in decision-making. In both the political and the economic sphere we all need to do more to ensure that women are involved in making the decisions that affect us all. That point was raised by my noble friend Lady Bottomley. CSW enables us to ensure that gender equality becomes a reality not just for the UK but for women everywhere.
To best respond to the question about what CSW’s impact on gender equality and the advancement of women is, we should remind ourselves what it is that CSW aims to do. In 1995, at the UN’s Fourth World Conference for Women, 17,000 participants and 30,000 activists arrived in Beijing to lend their voices and support to the campaign for gender equality. The UK and 188 other member states created the Beijing Declaration and Platform for Action, which laid out a series of promises by Governments to work towards the eradication of inequality.
The platform for action remains one of the most comprehensive and forward-looking texts on gender equality, and its manifesto underpins the UK’s work on empowering women.
Since 1996, the main focus of the work of the CSW has been the follow-up to the platform for action. Its annual gathering allows Governments to share their progress and ideas on gender equality, learn good practice from each other and, crucially, allows progressive member states, including the UK, to display leadership and influence global policy on equality, helping women everywhere to live better lives.
CSW-agreed conclusions are set global norms and recommendations for action by governments and intergovernmental bodies. They provide a benchmark that can be used to support other international negotiations and agreements. For example, the UK drew on the agreed conclusions from CSW 57—the one held last year—to inform the recent WHO violence resolution and UN Human Rights Council resolutions. The conclusions are also used as a lobbying tool by civil society at both national and international level.
This year’s CSW focused on the achievements and challenges of the millennium development goals, and was an important opportunity for the UK to help to shape the post-2015 development agenda. I am delighted to be able to say that in the agreed conclusions CSW called for a post-2015 development goal on gender equality and for women’s rights to be mainstreamed across the post-2015 agenda. That strong outcome was achieved despite determined efforts from some countries to roll back previously agreed positions on women’s rights. We were successful in securing strong language on UK priorities, including ending violence against women and girls, economic empowerment, leadership and participation in decision-making, strengthened data collection and disaggregation by sex and age, and ending harmful practices, including child early and forced marriage and female genital mutilation. That picks up on a point made by my noble friend Lady Nicholson of Winterbourne.
Next year, on the 20th anniversary of the Beijing platform for action, CSW will review Governments’ progress in fulfilling the promises made in the Beijing platform for action 20 years earlier in 1995. Moving to Beijing+20, member states are being called on to complete comprehensive national reports on their progress in the 12 critical areas for women identified in the Beijing platform for action.
The UK has today submitted its national report to UN Women, and we have some very good stories to tell on the progress that we have made in critical areas—particularly violence against women and women’s economic participation—but, guarding against complacency, the report has also shown that this is a good opportunity to identify where we need to do more to fulfil the promises that we made more than 20 years ago.
As noble Lords will be aware, 2015 also brings to a close the millennium development goals plan and marks the creation of a new strategy on global development. This is therefore a unique time to place the rights of women and girls at the heart of discussions on human development, and CSW has been an important means to achieve that. In 1995, the Beijing Declaration and Platform for Action called for the eradication of gender inequality. Twenty years on, that document remains forward looking, because we have yet to achieve a world in which men and women are treated equally. CSW plays a crucial role in advancing the rights of women and girls everywhere.
I will take whatever time I have left quickly to address points raised by noble Lords. The noble Baroness, Lady Hodgson, talked about reform of the CSW. We believe that the CSW could be made more effective. We are discussing with UN Women whether there is scope to reform the format of CSW to try to reduce combativeness and move away from entrenched positions.
My noble friend Lady Nicholson spoke about honour killings. The UK takes action to tackle honour killings both at home and abroad. We believe that challenging social norms requires long-term work with communities, working with men and boys as well as women and girls. We are supporting this work with communities at grass-roots level.
I congratulate the noble Lord, Lord Patel, on joining this debate. I am sure that he was not at all out of place as the only noble Lord among us. I congratulate him on the work he has done on fistula. I have seen this in Zambia. A couple of years ago I was at a bush hospital where they were taking women in in their fourth and fifth month of pregnancy to try to help them through the pregnancy and minimise fistula. That work is progressing. We are training people in the UK, not in surgery, but just to do certain work in this area.
My noble friend Lady Bottomley of Nettlestone said that the empowerment of women is a key thread in the CSW. I do not think that anybody here would disagree with that but we need more third-world role models in this area. Perhaps the CSW needs to think about setting a challenge to first-world corporates working in the third world; perhaps we need to think about our own responsibility challenge and how that might be replicated elsewhere.
All noble Lords questioned the area of development. The UK is engaged in the development of the post-2015 development framework. We are clear that there must be a stand-alone goal on gender equality which will address many of the issues raised by noble Lords. The noble Baroness, Lady Thornton, threw down the glove on the political side of things. I was looking at women in political spheres, not in connection with this but with something else, and we are not doing too badly at local government level. On representation in the House of Commons, it is very much in the hands of political parties to ensure, as she says, that more women are selected to fight key seats and all major political parties are working their socks off to try to achieve that for the next general election. Looking at the pattern of appointments to your Lordships’ House since 1997, increasingly more women are selected with each tranche of new Peers.
I congratulate my noble friend Lady Jenkin of Kennington on getting in during the gap and on her enthusiasm and work with UNICEF, cohosting today’s Girl Summit.
This has been a fascinating debate. I have run out of time but the Government are certain that their support for UN Women and the Commission on the Status of Women are to be continued.