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Diana Johnson (Kingston upon Hull North) (Lab)
Sir Robert Syms (Poole) (Con)
The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)
I have set up a taskforce bringing together small and medium-sized businesses, the Government, local government and trade unions to assist with the impact on small and medium-sized enterprises and the supply chain. The taskforce has delivered a range of supportive measures, including assistance from Her Majesty’s Revenue and Customs for those experiencing difficulties and more than £900 million of support from UK lenders.
Diana Johnson
I thank the Secretary of State for his answer, but, with 30,000 small firms thought to be owed money by Carillion due to late payments and fees, will he look at the idea of project bank accounts that hold money in trust in ring-fenced bank accounts to make sure this situation does not arise again? The Specialist Engineering Contractors Group wants Britain to follow what is already happening in Australia, where such project bank accounts are used in all large public and private building contracts.
Greg Clark
I will indeed look at that, and it has been one of the recommendations of the taskforce. It is important that we learn all the lessons and apply them quickly, and this is one such suggestion.
Mr Speaker
Sir Robert Syms—where is the fellow? I call Antoinette Sandbach.
Antoinette Sandbach (Eddisbury) (Con)
The local authority pension fund forum has called for a review of accounting standards, having received opinion that there are substantial legal flaws in international reporting standards. The opinion states that the standards do not enable anyone to make a meaningful assessment of a going concern, which is a highly relevant issue for Carillion. Will the Secretary of State support such a review?
Greg Clark
The day that Carillion went into insolvency I wrote to the Financial Reporting Council, and I spoke to its chairman, to ask it to investigate the auditors and those who are regulated as accountants. The FRC has agreed to do that, and it announced yesterday that the investigation is under way. I would expect it to learn the lessons for any changes to the regulations that it applies.
James Frith (Bury North) (Lab)
Will the Minister confirm whether the advice to firms that have lost money as subcontractors of Carillion is that they take out a loan? Does he think it is acceptable that those firms should be charged interest on taking out a loan, rather than getting the money they are owed for jobs they completed as supply chain businesses of Carillion?
Greg Clark
On the first day of the insolvency, I had in the representatives of all the supply chain organisations. The first request they made was that we get the banks in to make sure that they treat leniently their customers who were caught up in the insolvency. The banks agreed to do that, and they put funds aside to support and assist those customers. Each bank has made commitments that it will apply leniency to any terms and conditions faced by those businesses.
Michael Fabricant (Lichfield) (Con)
My right hon. Friend has almost answered my question, because I was going to say that cash flow is as important as profitability. The problem with lack of cash flow is when the banks become too heavy and foreclose on smaller firms.
Greg Clark
That is exactly the point that the businesses made. That is why I asked the banks to attend in person to meet those businesses, and it is why the banks gave those commitments and guarantees. It is important for Members with constituents who may be affected that the banks have made that commitment and have made a promise that they will deal individually with anyone who is so affected. The measures are on each bank’s website, but any colleague should come back to me if they experience a problem.
Rachel Reeves (Leeds West) (Lab)
This morning, at a joint Select Committee hearing on Carillion, we were told by the chief executive of the Financial Reporting Council that, before and after the collapse of BHS, he had asked for greater powers to regulate companies and take action before things go badly wrong. He told us that there was a lack of Government interest in making the necessary changes. In the light of the collapse of Carillion and the threat to thousands of jobs and suppliers in the supply chain, are the Government interested in taking action now?
Greg Clark
I do not agree with the hon. Lady. I engaged the FRC immediately, and it is very important that we and the FRC learn the lessons. We will apply whatever is appropriate that comes from those inquiries.
Mr Speaker
The hon. Member for Poole (Sir Robert Syms) says that he was not told of the grouping. If that is so, it is a discourtesy—I hope it is not so. Maybe it got lost in the post. Let us hear from the fellow.
Sir Robert Syms
The collapse is really bad news for many smaller businesses, many of which will have their capital wiped out. What discussions has the Secretary of State had with banks about forbearance in keeping those businesses going so that there is proper competition in this market for the future?
Greg Clark
I apologise to my hon. Friend if he did not receive notice of the grouping—I am sure that is my error.
On engagement with the banks, each of them has responsibilities to its customers to help them through difficult times. The banks have explicitly committed to help them with any cash flow difficulties that they experience, and I expect the banks to deliver on it.
Alison Thewliss (Glasgow Central) (SNP)
Greg Clark
The hon. Lady raises an excellent question, and I want to pay tribute to the CITB, which has been working closely with its Scottish colleagues, for a magnificent response. It has been able to not only contact but offer continuity to all the apprentices—I think I am right in saying that—to give them the ability to continue their training. That was a formidable, agile response to an urgent situation, and it deserves the praise of the House.
Rebecca Long Bailey (Salford and Eccles) (Lab)
In July last year, the Government were warned by the Federation of Small Businesses and the Specialist Engineering Contractors Group that Carillion was transferring risk to its subcontractors. They highlighted that Carillion’s payment period was doubled from 65 to 120 days, that Carillion made money on the back of early payment by charging fees, and that regulation 113 of the Public Contracts Regulations 2015, which relates to 30-day payment, was not being enforced. Will the Secretary of State outline what actions, if any, he took on receipt of that information?
Greg Clark
The lessons and the scrutiny of what went wrong in Carillion, both on the part of its directors and its scrutineers, and in the oversight that took place across the whole of the public sector in terms of contracting, need to be looked at and will be looked at, including by Select Committees of this House. Whatever actions are required from that, we will take.
Rebecca Long Bailey
So it is clear that no action was taken and that subcontractors were being mistreated again and again. But that is not all: the FSB and SEC Group also highlighted how retention moneys and project funds due to suppliers were not being protected from Carillion’s potential insolvency. As a result of the Government’s inaction, microbusinesses are now owed on average £98,000, small firms £141,000 and medium-sized firms £236,000, and large businesses are owed on average £15.6 million. Will the Secretary of State therefore explain to the House and all the businesses affected why the Government took no action last July and why many are on the verge of bankruptcy today?
Greg Clark
Retentions and project bank accounts have been the subject, in response to those and other concerns, of a consultation on specific measures, which closed very recently. That came out of the recommendations that were made. Part of the taskforce that we have established includes these representative bodies, and they know that they have my commitment to take all the necessary actions to learn the lessons and protect any future concerns against things that could be learned from this case.
James Cartlidge (South Suffolk) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
The national minimum wage and national living wage rates are recommended to the Government by the independent Low Pay Commission. To ensure that workers are paid fairly and that non-compliant employers are caught, the Government provide £25.3 million to Her Majesty’s Revenue and Customs for minimum wage enforcement —that is an increase from £13 million in 2015-16. Last year, HMRC secured arrears of wages for 98,000 workers, totalling £10.9 million.
James Cartlidge
I thank my hon. Friend for that answer and welcome him to his deserved new position. I very much welcome the national living wage as a way of boosting the wages of our lowest-paid workers. Does he share my surprise that there are those who criticise its generosity, given that the only international comparator is The Economist’s Big Mac index, under which we have the most generous minimum wage in Europe aside from that of its richest country, Luxembourg?
Andrew Griffiths
I completely agree with my hon. Friend on that. The next increase to the national living wage is to be a whopping 4.7%. The introduction of the national living wage was the biggest pay rise for low-paid workers in nearly 20 years. The latest increase will benefit more than 2 million people and is set to cover 3 million by 2020. The average earnings of a 25-plus, full-time worker have increased by £2,000 since 2016.
Helen Jones (Warrington North) (Lab)
When will the Government accept the need to actually prosecute more firms that fail to pay the national minimum wage? Only when people are prosecuted for breaking the law, rather than being issued with warning notices, are they going to take it seriously.
Andrew Griffiths
I gently point out to the hon. Lady that the Government take robust enforcement action against employers who do not pay their staff correctly. We have increased enforcement funding to £25.3 million this year. The total value of penalties has more than quadrupled since 2014-15, and in 2016-17 a record £3.9 million was recovered in penalties, with one penalty of more than £1 million being issued.
Tom Pursglove (Corby) (Con)
Along with the steps the Minister has outlined, does he agree that increasing the tax-free threshold and taking the lowest paid out of tax altogether has made an enormous difference to many workers in this country?
Andrew Griffiths
I absolutely agree with my hon. Friend: 4 million people have been taken out of paying tax as a result of decisions taken by this Government. The employment rate is 75.3%, which is the joint highest rate since comparable records began in 1971. We have record numbers of people in work, and unemployment is at its lowest for 40 years. This Government are on the side of the worker and the lowest paid.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Low pay stifles investment and holds back productivity. We in the Scottish National party believe that the economy is stronger when a real living wage is paid. The Minister’s own Department has rightly named and shamed 350 companies for failing to pay even the minimum wage. Does he therefore agree that the practice of companies paying no wages at all through unpaid work trials is morally repugnant? Will his Department support the ending of that shameful practice?
Andrew Griffiths
I should point out to the hon. Gentleman that more than 160,000 people in Scotland benefit directly from the national living wage. The Government are looking closely at employment practices. We engaged Matthew Taylor to look into employment practices and to come up with new ways to support people, particularly those in the gig economy. We very much value that work and will be coming forward with recommendations in the very near future.
Laura Smith (Crewe and Nantwich) (Lab)
Stephanie Peacock (Barnsley East) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
The Government will legislate to require quoted companies to publish and explain the ratio of their chief executive officer’s pay to the average pay of their UK employees. Companies will also have to provide a better explanation of how share price increases affect the value of complex, long-term incentive plans.
Laura Smith
Does the Minister acknowledge that there is sufficient compelling evidence to conclude safely and beyond any reasonable doubt that collective bargaining significantly reduces income inequality?
Andrew Griffiths
The hon. Lady is absolutely right to raise the issue of collective bargaining and how that affects employee pay and the wider pay of executives. I should point out to her one interesting fact: the average FTSE 100 CEO’s pay leapt from £1 million to £4.3 million between 1998 and 2010, but CEOs’ pay fell by 17% in 2016. Interesting.
Stephanie Peacock
It would take the average person in Barnsley East more than 176 years to earn what the average FTSE CEO earns in 12 months. Does the Minister agree that that is a sign of grotesque inequality in the UK? What is he going to do about it?
Andrew Griffiths
What private companies pay their directors is ultimately a matter for their shareholders, but the new pay ratio disclosure requirements mean that we will give shareholders and other stakeholders important new information on how pay at the top of companies fits with wider workforce pay. Companies will be forced to explain and defend their pay ratios and account for changes to the ratio over time.
Mr Philip Hollobone (Kettering) (Con)
Does the Minister agree that Britain’s biggest broadcaster, the BBC, is setting an appalling example to the nation over executive pay in failing to ensure gender parity?
Andrew Griffiths
I assure my hon. Friend that we absolutely and completely agree with fair pay. It is unacceptable that women who are doing the same job as men receive less pay. That must change. The BBC must act.
Jo Swinson (East Dunbartonshire) (LD)
Hardworking people on ordinary incomes are understandably angry at the way executive pay has skyrocketed at a time when ordinary wages have remained flat. When can we expect to see these regulations that the Minister is talking about on publication of pay ratios, and can he confirm that this requirement will be in place for companies by June, as promised?
Andrew Griffiths
I have to point out to the hon. Lady that she may have her figures wrong. CEO pay has fallen, not risen. This Government are keen to ensure that there is more accountability and transparency in relation to the pay of top executives. We want to give the shareholders of companies greater power and ensure that there is greater accountability to shareholders and to the workforce.
Laura Pidcock (North West Durham) (Lab)
Since 2010, Carillion has paid out more than £500 million in dividends to shareholders while, over the same period, running up a pensions deficit of £587 million, a deficit that is now threatening the security of thousands of hardworking people. While those people suffer, former Carillion CEO Richard Howson was rewarded with a bonus package worth £1.5 million in 2016. Will the Government join me in condemning this scandal and work with the Labour party to end the failed model of outsourcing using shell companies and in condoning excessive pay, or will it be just business as usual?
Andrew Griffiths
Please allow me to assure the hon. Lady that any payments due to directors and executives of Carillion have been stopped; nobody is getting paid and nobody is getting executive bonuses. The moment that the insolvency happened, the Secretary of State wrote both to the Insolvency Service and the FRC to ensure that there was a thorough investigation of all payments to directors. If necessary, PricewaterhouseCoopers and the Insolvency Service have the power to claw back all of those payments. I can assure her that we will be learning the lessons from the Carillion insolvency and ensuring that we do all we can to support businesses going forward.
Several hon. Members rose—
Mr Speaker
Order. We have a lot of questions to get through, so we do need to speed up a little bit.
Chris Williamson (Derby North) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
The Government believe that seafarers should be paid fairly for the work that they do. My Department and the Department for Transport worked with trade unions and employers to publish new guidance that explains the responsibilities of employers to pay the national minimum wage. We are crystal clear that if someone works in UK waters, they are entitled to at least the minimum wage and that all employers—no matter where they are from—must pay it.
Chris Williamson
I am pleased to hear that, but is the Minister aware that UK seafarers are being undercut by rates of pay as low as £1.75 an hour? That is happening even though the legal working group on seafarers and the national minimum wage, which includes his Department, agrees that legislative change is needed to provide more protection. Will the Minister give a commitment to work with the RMT and Nautilus to end this brazen exploitation, starting with the application and enforcement of the national minimum wage for seafarers working between UK ports and offshore installations?
Andrew Griffiths
I reassure the hon. Gentleman that the guidance is clear that the national minimum wage applies on foreign registered ships when they are in UK territory. The new guidance is the first of its kind on the application of the national minimum wage specifically to seafarers, which shows that this is a priority for the Government. UK national minimum wage law must naturally have a limit, but if a person is employed as a seafarer in British waters, they will be entitled to the national minimum wage.
Ben Bradley (Mansfield) (Con)
The Minister for Higher Education (Mr Sam Gyimah)
The Department for Business, Energy and Industrial Strategy and the Department for Education are working together to establish a world-class technical education system, which is vital to our industrial strategy. This includes encouraging businesses, including SMEs, to offer apprenticeships. We are working with all employers to ensure that the apprenticeship levy works effectively and flexibly for industry and supports productivity across the country.
Ben Bradley
I welcome my hon. Friend to his role on the Front Bench. I have previously had conversations with my right hon. Friend the Member for Putney (Justine Greening) in her former role as Education Secretary about finding new ways to support SMEs in my constituency to get involved in education, particularly through apprenticeships, which are important for my constituency as so few people there go to university. I will continue that approach with the Department for Education, but would my hon. Friend commit to meeting me to discuss how we might further support small businesses to train young people in Mansfield?
Mr Gyimah
My hon. Friend is absolutely right. We are committed to supporting businesses in Mansfield through the D2N2 Growth Hub. Since its launch, it has engaged more than 5,100 businesses. He mentions young people in his constituency. The message from this Government is that we will support those who think university is the best route towards building the future they want and that we will also support those for whom apprenticeships or a non-university route is the best route. We do not want to put a limit on aspiration, whatever that aspiration may be.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I know that the Minister is new in his post, but he needs to wake up, for goodness’ sake. There is chaos and meltdown in the apprenticeship scheme, with a 62% drop in apprenticeship starts and further education colleges in bankruptcy. Small individual employers in the textile industry cannot get their apprenticeships through. Get a move on—do something about it, man!
Mr Gyimah
I welcome the characteristic passion with which the hon. Gentleman delivers his question, and I share his objective in that we both want the best future for young people. As he knows, the apprenticeship system is going through a change. It will now be employer-led with a focus on quality. We are in the first year of the levy operating and we did expect a bit of a dip, but this situation will recover to deliver the future for our young people.
Jeremy Lefroy (Stafford) (Con)
Further education colleges such as Newcastle-under-Lyme College and Stafford College are vital to the provision of apprenticeships, both under the levy and non-levy. But just having the levy on its own is not necessarily sustainable. Will the Minister ensure that all further education colleges have access to funding for non-levy apprenticeships?
Derek Twigg (Halton) (Lab)
Businesses still tell me that there is a skills shortage in my area. FE colleges have continually faced cuts by this Government. Given the introduction of the levy and the other policies that the Government have been talking about, at what point in time does the Minister believe the skills gap will be filled, to meet the needs of business and the wider community?
Gavin Robinson (Belfast East) (DUP)
The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)
The Government enjoy a strong partnership with the aerospace sector through the Aerospace Growth Partnership. Since 2010, the sector’s turnover has grown from £24 billion to £34 billion, and exports have almost doubled. Following the excellent and wholly justified ruling of the United States International Trade Commission on Friday night, I am delighted that Bombardier in the hon. Gentleman’s constituency will be able to look forward to a bright future.
Gavin Robinson
Hear, hear! I was overjoyed on Friday night when Bombardier unanimously won its case with the United States International Trade Commission. In paying tribute to the Secretary of State and to the Minister responsible for the aerospace industry, I ask that they stand resolute against any appeal that may be lodged and ensure that the C Series, now that it is finally ready for take-off, is the true success we know it can be.
Greg Clark
I will indeed. I pay tribute to the hon. Gentleman for the stalwart way in which he and his colleagues stood up for their constituents and, indeed, the supply chain that covers the whole United Kingdom. Right from the beginning, this has been a joint endeavour between us, the Canadian Government, the company and everyone with an interest in the success of Bombardier.
Vicky Ford (Chelmsford) (Con)
Does my right hon. Friend agree that the future of our space and aerospace industries is key to our economic future and that practical measures like the new Space Industry Bill will open up new opportunities?
Greg Clark
I do indeed. Space is one of the fastest-growing sectors of the economy, and we are world leaders in it. Through the Bill, we will ensure that we have the right regulatory regime to underpin that.
Sir Vince Cable (Twickenham) (LD)
Since the aerospace sector requires long-term planning and investment, does the Secretary of State not share my alarm at the threatened takeover of the leading tier 1 supplier GKN by a turnaround company specialising in maximising shareholder returns over five years maximum? Is this not a national security issue?
Greg Clark
The right hon. Gentleman is a previous occupant of my post, so he knows that the powers that the Secretary of State has over these things have to be exercised in a quasi-judicial way. Therefore, I should not, and cannot, comment on that case. However, he will know, because he has written to me, that I have spoken to both chief executives, and I am keeping it under close review.
Luke Graham (Ochil and South Perthshire) (Con)
It is good to hear my right hon. Friend talk about the importance of aerospace. Will he consider the aerospace initiative that is being proposed in Kinross-shire in my constituency as part of the Tay cities deal, and will he or other colleagues meet me to discuss it?
Greg Clark
My colleagues and I will be very happy to meet my hon. Friend to develop the full potential of aerospace in his constituency.
Martin Whitfield (East Lothian) (Lab)
The Minister for Higher Education (Mr Sam Gyimah)
Representatives of the Keep Me Posted campaign are dedicated advocates for consumer choice on billing. Neither I nor current BEIS Ministers have met them, but my officials have done so in the past and are familiar with their campaign and the valuable work they do.
Martin Whitfield
Considering the levels of digital exclusion, including in broadband coverage in my constituency, will the Minister agree to meet me and Keep Me Posted to discuss the implications for our constituents?
Mr Gyimah
In response to the hon. Gentleman’s point about exclusion, I think the House can celebrate the fact that, under this Government, 95% of the country will be covered by our superfast broadband roll-out. However, I take his point on board and will be delighted to meet him.
Mike Wood (Dudley South) (Con)
Will the Minister work with banks and utilities to ensure that charges for paper billing are restricted to the actual cost of providing that service and are not allowed to become a cumulative fee for those who need or choose paper bills?
Nigel Dodds (Belfast North) (DUP)
I welcome the Minister’s commitment to meet the Keep Me Posted campaign. That is a very welcome development, particularly because older people in my constituency have made representations to say that they find it intolerable that they are not able to get paper bills. Will he assure me that he will take this on board for the whole United Kingdom?
Mr Gyimah
Absolutely. I do agree that consumer choice is important. Many suppliers offer paper bills, but they are not cost-free. It is important to recognise that at a time when we are seeking to boost productivity, it is not unreasonable for businesses to incentivise more efficient billing processes. The regulatory framework varies by sector. Where charging differentials exist, we would look at that. I am happy to look at it across the whole United Kingdom.
Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)
While recognising the gradual shift away from paper statements and bills as they go online, it must be acknowledged that 16 million people over 15 years old still do not have basic online skills and 5.2 million households still do not have access to the internet at home, and they may face penalisation for requesting a paper bill or statement. What action, exactly, will the Minister take to ensure that people are not penalised for making what should be a legitimate consumer choice? What strategy will he put in place to make sure that people who do not have these skills at the moment can develop them in future?
Mr Gyimah
The hon. Lady makes the very important point that we should make sure that those who need paper bills do receive them and are not unfairly penalised. Any discount made for paperless bills, or charge for paper bills, in sectors where this is allowed must be justified in relation to the relevant administration costs. We do not believe that the Government should intervene to make other customers for whom online billing and payment is perfectly acceptable bear the costs of providing a paper billing service.
Trudy Harrison (Copeland) (Con)
Maggie Throup (Erewash) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
We are actively supporting small businesses by enhancing the business support helpline and funding growth hubs in every local enterprise partnership area in England. The new Small Business Commissioner will help with payment issues, and British Business Bank programmes support nearly £4 billion of finance to more than 60,000 small and medium-sized enterprises.
Trudy Harrison
I thank the Minister and welcome him to his new position. Sellafield in my Copeland constituency is one of Britain’s biggest single-site employers. It is about to award its multimillion PPP contract. What is he doing to promote the role of SMEs, rather than just large companies, when awarding those contracts?
Andrew Griffiths
I clarify to the House that PPP stands for “programme and project partners” and not, as many might have assumed, “public-private partnership”. The programme that my hon. Friend talks about will support Sellafield in decommissioning and contains provisions designed to support small businesses. In November 2015, the Cabinet Office agreed to a target of 31% of spend with SMEs for the Government’s Nuclear Decommissioning Authority. Moreover, as the Small Business Minister, I will look at what I can do to ensure that more is done to help small businesses to win Government contracts.
Maggie Throup
Will the Minister join me in commending the work of the Erewash Partnership, which helps entrepreneurs in my constituency to start up and grow their own small businesses? Will he consider what more Government can do to help such organisations expand their support services?
Andrew Griffiths
I am delighted to join my hon. Friend in applauding the work of the Erewash Partnership, which she will know was a previous winner of a national enterprise award—well done them. Through our industrial strategy, all businesses in every region will have access to a growth hub. We have announced a further £24 million of core funding over the next two years for growth hubs, including the D2N2, which I understand works with the Erewash Partnership. I am delighted to work with her to do what I can to support businesses in her constituency.
Richard Burden (Birmingham, Northfield) (Lab)
Stability among larger tier 1 suppliers is really important to SMEs in the automotive and aerospace supply chains. Given that, does the Minister agree that if the Melrose bid for GKN splits up and sells off that company, as is anticipated, that cannot be in the interests of either sector or SMEs in this country?
Andrew Griffiths
We are always sensitive and aware of the impacts on the supply chain. We need a strong supply chain, but I point the hon. Gentleman to the Secretary of State’s previous answer on that issue.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Support for the small business sector will be even more urgent given the findings of the UK Government’s leaked Brexit analysis, which shows that in all current scenarios, businesses across all sectors and all parts of the UK will be hammered with between 2% and 8% reductions in GDP growth. Will the Minister confirm what planning his Department has undertaken in the light of those figures? Is he declining to publish because it is too embarrassing?
Andrew Griffiths
The hon. Gentleman will know that that issue is the subject of an urgent question later on in the House. I would hate to spoil his fun, so I will leave it to others.
Helen Hayes (Dulwich and West Norwood) (Lab)
The Minister for Energy and Clean Growth (Claire Perry)
If you will indulge me, Mr Speaker, I would like to pay tribute to the hon. Lady’s predecessor, who made an amazing and powerful speech in the other place. It was quite astonishing.
We should all be proud of the excellent progress the UK has made in meeting its carbon reduction targets. The current numbers show that we have met out first budget, are on track to exceed our second and third budgets and are 97% and 95% of the way to meeting our fourth and fifth budgets. The clean growth strategy that I brought forward last year sets out an ambitious set of 50 policies and proposals that will help us to meet those targets.
Helen Hayes
I thank the Minister for her tribute to my predecessor, Baroness Jowell, who is much loved in Dulwich and West Norwood.
Southwark Council confirmed last week that it has invested its £150 million pension fund in a low-carbon investment, concluding that continuing to hold significant investments in fossil fuels in the context of climate change would present a long-term financial risk to the fund. Will the Minister tell me what conversations she is having with private firms with large pension funds to encourage and facilitate divestment from fossil fuels, which is now clearly the most responsible decision for pension fund members and the future of our planet?
Claire Perry
The hon. Lady points out the very powerful fact that the Government can set policy and bring forward achievable targets, such as our renewables ambition, but we also need the private sector and private capital to be involved in financing this transition. I have numerous conversations with companies about what they are doing with their own investments and, equally, about what they will be doing to help other companies to invest in a more sustainable future. I refer her to the Powering Past Coal Alliance, which I launched with my Canadian counterpart last year and which is helping the world to get off the dirtiest form of fossil fuel heating.
Stephen Crabb (Preseli Pembrokeshire) (Con)
Given that more than a year has now passed since the Hendry review reported on the potential contribution of tidal lagoon technology, when does my right hon. Friend think that Ministers will be able to respond positively to that report and give a green light to this important environmental technology?
Claire Perry
I am left in no doubt by my right hon. Friend and others about how anxious people are to see this review go forward. We want to get our future investment in renewable energies right. We continue to look very closely at this, and I hope that we will be able to inform the House shortly.
Dr Alan Whitehead (Southampton, Test) (Lab)
The Minister will have seen the recent report by the Committee on Climate Change about the Government’s clean growth strategy in relation to the fifth carbon budget. Indeed, I know that she has seen it, because she wrote the committee a nice letter thanking it for its report. What plans does she have in place to rectify the shortcomings and omissions in that strategy, as identified by the Committee on Climate Change in its report?
Claire Perry
As the hon. Gentleman and I both know, the report basically said there had been a sea change in our ambition for future climate reduction actions. I was extremely grateful to the committee, as I always am, for its scrutiny and information. We were the first country in the world both to pass a climate change Act and to set up an independent scrutineer. As we all know, we have to do more, particularly on business energy efficiency and new homes standards. I am looking forward to working in a consensual way, cross-party, to bring forward those measures.
Martin Vickers (Cleethorpes) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
I am delighted that the industrial strategy White Paper commits to considering a town deal for Grimsby, which I know has been warmly received by my hon. Friend. I welcome the strong public-private approach to driving forward ambitious plans for the regeneration of Grimsby. The Department and the project board are in close contact on the detail of this deal, and I hope that we will have a proposal for consideration in the very near future.
Martin Vickers
I thank the Minister for his reply, and I would point out that this deal also includes Cleethorpes—it is for Greater Grimsby. I know that discussions are continuing at official level, but I would welcome an opportunity for the Minister to meet representatives of the project board in the new future, so that we can give some political clout to this deal, which could provide a pilot for many provincial towns up and down the country.
Richard Harrington
I would be delighted to meet my hon. Friend and members of the Greater Grimsby—including Cleethorpes—project board either as soon as I am able to leave Westminster or in Westminster. I encourage my hon. Friend to organise a meeting here so as not to lose any time in holding this important engagement—and if he wants to bring some local fish and chips, that would be fine.
Melanie Onn
The hon. Member for Cleethorpes (Martin Vickers) will know that Great Grimsby is obviously the centre of the universe, certainly in northern Lincolnshire. This project is really important, and it is essential to improving jobs, skills, housing and culture in my constituency of Great Grimsby. It does seem to have been ping-ponged between the Ministry of Housing, Communities and Local Government and the Department for Business, Energy and Industrial Strategy. Who is taking the lead, how much will the Government commit to ensuring its success and when will my very patient constituents start to see the change that they deserve?
Richard Harrington
I assure the hon. Lady that I am not a ping-ponger, and this shows the Government working together. We will continue to work together, and I will take responsibility for making sure this happens as soon as is possible.
Paul Blomfield (Sheffield Central) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
The taskforce established to tackle the impact of Carillion’s liquidation includes the Department for Work and Pensions, and my right hon. Friend the Business Secretary is in regular contact with my right hon. Friend the Pensions Secretary. Those already receiving their pensions will continue to receive payment at 100% of the usual rate. Anyone worried about their pension situation can contact the Pensions Advisory Service; its dedicated helpline has now responded to over 800 calls since Carillion’s insolvency.
Paul Blomfield
I thank the Minister for that answer, but I think it will be of very little comfort to many Carillion staff, past and present, when they hear that the deficit in their pension fund is approaching £1 billion. Public sector contracts have made some at the top of Carillion very rich indeed, so what action is the Minister taking to ensure that current and future pensioners do not lose out?
Andrew Griffiths
The hon. Gentleman will understand that issues in relation to pension schemes are a matter for the independent Pensions Regulator. However, the Pensions Regulator has been in contact with Carillion and the pension scheme trustees for a number of years about the funding of the pension scheme. I can absolutely assure the hon. Gentleman that the work of the taskforce is to look at what happened in relation to the Carillion insolvency, and to ensure that if lessons are to be learned, we will learn them.
Rachel Maclean (Redditch) (Con)
The global headquarters of GKN is in my Redditch constituency. It employs 200 people, and concerns have been raised about the pension scheme there as well. The Pensions Regulator is warning that in the event of a takeover, there may be something to look at. What lessons is the Minister learning from Carillion in this case, and what further action does he need to take?
Andrew Griffiths
The Secretary of State, I think, has already outlined the approach with which the Government are handling the takeover of GKN, but I can assure my hon. Friend that the implications of business actions, and particularly takeovers, in relation to pension schemes are a priority for the Government. We will continue to proceed with care and caution to protect the interests of all members of pension schemes.
Gareth Thomas (Harrow West) (Lab/Co-op)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
The Government work to ensure that our labour markets work for everyone. That was why the Prime Minister asked Matthew Taylor to carry out an independent review on modern working practices. The Government are considering the issues that the review has raised, including rules governing the use of agency workers. The review is comprehensive and detailed, and we have been giving the report the careful consideration it deserves. We will respond shortly.
Gareth Thomas
Two thousand workers in BT call centres, some of whom handle 999 calls, are paid up to £500 less per month than permanent staff because BT uses the loophole known as the Swedish derogation under agency workers regulations. Taylor recommended its abolition; when will the Minister get on with it?
Andrew Griffiths
As I have outlined, the Matthew Taylor report does, in some depth, look at the Swedish issue. I am meeting Matthew Taylor this afternoon, and that issue will be one of those that we shall discuss. I can reassure the hon. Gentleman that in 2017, the employment agency standards inspectorate dealt with more than 800 complaints from agency workers. EAS investigations have protected an estimated 303,000 agency workers, and we will continue to defend their interests.
John Cryer (Leyton and Wanstead) (Lab)
How many of those complaints under the agency workers directive led to successful prosecutions?
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
Mary Creagh (Wakefield) (Lab)
The Minister for Energy and Clean Growth (Claire Perry)
The development of renewable energy is a tremendous UK success story. Thanks to our significant investment and the support of all of us, renewable capacity has quadrupled since 2010. Last year, 30% of our electricity generation came from renewable sources.
Stuart C. McDonald
Yesterday, 10 UK trade associations wrote to the Secretary of State to express serious concern about delays to the long-awaited feed-in tariff consultation. Will he or Ministers agree to meet them to address both those concerns and the uncertainty facing small-scale low-carbon energy projects?
Claire Perry
I am always happy to engage with anyone who would like to further the cause of renewable energy in the UK, so I would be happy to do so.
Paul Masterton (East Renfrewshire) (Con)
More than half of Scottish energy consumption is met by renewable sources, including the Whitelee wind farm, based near Eaglesham in East Renfrewshire, which is the largest onshore wind farm in the UK, but can the Minister confirm that less-established renewable energy projects in Scotland will be able to compete for the £557 million of funding that is available as part of the clean growth strategies?
Claire Perry
As my hon. Friend knows, because we have discussed it several times, we are looking hard at how we use that committed £557 million of support for renewable energy in a way that brings forward projects when there is significant local support. I look forward to continuing the discussion with him.
Ronnie Cowan (Inverclyde) (SNP)
Claire Perry
Scotland benefits from some fantastic geographical advantages that mean that it is a world leader in many of these things, but it is, of course, UK bill payers across the nation who are investing in the introduction of renewable energy, whether that is in England, Scotland, Wales or Northern Ireland.
Mark Pawsey (Rugby) (Con)
Gillian Keegan (Chichester) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
We have a range of grant schemes to support the installation of charging infrastructure—on-street, off-street and at workplaces. At the autumn Budget, the Chancellor announced a £400 million joint public and private charging infrastructure investment fund.
Mark Pawsey
My constituency is already home to the new electric London taxi, and we have recently heard the announcement of £80 million of investment in a new electric battery development facility in Coventry. Does the Minister agree that this presents opportunities for my constituency and the wider area to establish leadership in the electric vehicles sector?
Richard Harrington
It certainly does, and I have had the honour of visiting my hon. Friend’s constituency. On the day we announced the battery facility he mentions, the CEO of Jaguar Land Rover declared:
“We also intend to produce battery electric vehicles in the region, bringing the West Midlands to the forefront of modern mobility in the UK.”
That is the industrial strategy in action.
Gillian Keegan
Chichester District Council has invested in 20 new electric vehicle charging points in carparks throughout the district. However, a constituent recently told me that it took him six and a half hours to get from Chichester to Oxford in his electric car because there were insufficient charging points during the journey. What is the Minister doing to join up individual council initiatives to ensure that there is a comprehensive network of charging points nationwide?
Richard Harrington
We are pressing hard on this. The Government are taking powers under the Automated and Electric Vehicle Bill to ensure that the infrastructure is rolled out. Government leadership, along with local authority engagement and a growing private sector, means that the UK now has more than 11,500 publicly accessible charge points. The Government have committed £15 million to ensuring that there will be one every 20 miles on the strategic road network. That is coming, and it will be coming soon.
John Penrose (Weston-super-Mare) (Con)
The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)
Since our last Question Time, it has been my pleasure to introduce my new colleagues, my hon. Friends the Members for East Surrey (Mr Gyimah) and for Burton (Andrew Griffiths), to the Department and to see our agenda progressing. We announced the automotive sector deal, supporting British innovators and manufacturers with a joint commitment of millions of pounds of investment from industry and Government. The Society of Motor Manufacturers and Traders said that the deal would place the UK at the forefront of electric, connected and autonomous vehicles. I am delighted to announce that Lotus Cars has announced its intention to invest significantly to expand its production, creating 300 new jobs at its plant in Norfolk. Production will increase fivefold in the years ahead.
John Penrose
Energy distribution network operators charge obscenely high prices on our energy bills and make absurdly large profits for running safe, low-risk monopoly businesses that get energy to our homes. Does the Secretary of State agree that Ofgem has been far too soft on these firms for ages, allowing them to get fat and lazy at customers’ expense? Will he join me in urging Ofgem to get a great deal tougher in future?
Greg Clark
I agree with my hon. Friend and welcome the decision by SGN, SSE and National Grid to refund excess returns to consumers—the others should follow suit. He is absolutely right, and in the next price control period, Ofgem should have a much tougher regime.
Several hon. Members rose—
Mr Speaker
Order. May I gently remind colleagues that at topical questions progress is expected to be much quicker? We need short, sharp inquiries; people should not simply seek to bring into topicals what they would have asked had they been called—which they were not—in substantive questions. Pithy questions; pithy answers.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I shall try to be pithy, Mr Speaker.
GKN is a great British engineering company, forged in the first industrial revolution with strengths in defence, aerospace, automotive, batteries and the internet of things, which should place it at the heart of our future economy—high skills, high productivity and high wage—but the debt-driven hostile takeover threatens 6,000 UK workers, pension funds and the supply chain. The Secretary of State has said that he will not comment on individual cases, so may I ask him a general question? Does he believe that it is in the national interest for City investment houses to use debt to dismantle our industrial base?
Greg Clark
The hon. Lady understands the constraints that I have in any particular takeover. As a feature of our economy, it is very important that we have investment into our companies from those with the capital to do so. That is why we have a regime that limits the grounds for intervention, but there are certain grounds that I will have to consider during the time ahead.
Mr Laurence Robertson (Tewkesbury) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
The sector has huge growth potential. The Government support the industry through the aerospace growth partnership and have committed £3.95 billion for it, which already supports 200 companies, including Safran and GE Aviation in my hon. Friend’s constituency.
Rachel Reeves (Leeds West) (Lab)
The Minister for Energy and Clean Growth (Claire Perry)
Having just taken over the diversity portfolio in the Department, I share the hon. Lady’s extreme disappointment at companies failing to report. I will take this matter forward and perhaps work with her as a matter of urgency.
Bim Afolami (Hitchin and Harpenden) (Con)
The Minister for Higher Education (Mr Sam Gyimah)
I will make three quick points: the Government are investing £70 million in the agri-tech catalyst and £80 million in four centres for agricultural innovation through the 2013 agri-tech strategy; and I pay tribute to Rothamsted Research as a key partner in agrimetrics. We are working together to deliver integrated solutions for the agricultural community.
Chris Elmore (Ogmore) (Lab)
Greg Clark
Officials are meeting their counterparts in the Welsh Government so that they can understand and explore the proposal that has been made.
Maria Caulfield (Lewes) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
I take on board the very important question that my hon. Friend asks. The Government have invested over £2 billion to ensure that the Post Office is able to meet the needs of our constituents and the small businesses that rely on it. That means that 99% of UK personal bank accounts and 95% of small business accounts can be accessed to withdraw cash, and that customers can deposit cash over the counter or cheques in any one of the 11,600 post offices across the UK.
Wera Hobhouse (Bath) (LD)
Claire Perry
I am sure that the hon. Lady will be delighted to know that I opened Britain’s first subsidy-free solar farm last year. The great success of the policy framework and the investments that we have all made through our bills means that we are able to bring forward renewable energy without substantial subsidies. I would have thought that she would welcome the idea of getting more renewable energy for less investment.
Mr George Howarth (Knowsley) (Lab)
Given that the Keep Me Posted campaign has pointed out that those who cannot or do not use the internet pay £440 a year more in household bills, will the Minister consider extending the provisions that already exist in banking to energy and telecommunications bills?
Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
Mr Speaker
I remind colleagues of the merits of the blue pencil. If you have a prepared question and it is a bit on the long side, just scratch a bit out—very useful, and the question never suffers.
Andrew Griffiths
I congratulate my hon. Friend on his tenacity in campaigning on behalf of his residents. Following his representations on the impact of the proposed redundancies, I am happy to confirm that there will be additional flexibility in how the rapid response service can be used. That means that, while there is no additional funding, all workers made redundant from Cleveland Potash will benefit from the same flexibilities for job-focused training as have been made available to ex-SSI and supply chain workers.
Jim Shannon (Strangford) (DUP)
Greg Clark
We keep the insolvency regulations under constant review, in response both to Brexit and to lessons learned from our experiences domestically. I will work with the hon. Gentleman to make sure that his views are fed in.
Neil Parish (Tiverton and Honiton) (Con)
Consumers in the south-west are paying extra on their bills because energy network companies are charging too much. We need greater competition and more teeth in the watchdog to do something about it.
Claire Perry
I think that my hon. Friend is inviting me, as a fellow south-west MP, to agree with him. Network costs vary regionally because of different costs in serving customers. Ofgem took more than £15 billion out of network costs in its last price control framework, and I look forward to introducing various measures such as the price cap Bill, which I shall be introducing shortly, that I hope will be supported by all Members of the House. We want to ensure that we have energy bills that consumers can afford and that we protect the most vulnerable in the process.
Mr Speaker
Short, single-sentence questions are now the order of the day, as will be brilliantly exemplified by the hon. Member for Westmorland and Lonsdale (Tim Farron).
Tim Farron (Westmorland and Lonsdale) (LD)
I will see what I can do.
The universal service obligation for superfast broadband will be good news for businesses across the country, but the fact that the announcement has been made with no date makes it counterproductive, as that is slowing down broadband. Will the Government announce a date and say that registration can start immediately?
Andrew Griffiths
The hon. Gentleman will find that the date set out in the Digital Economy Act 2017 was 2020, but I am sure he will join me in congratulating the Government on their success in ensuring that 95% of the country now has access to broadband.
Kevin Hollinrake (Thirsk and Malton) (Con)
Will the Minister support Transport for the North’s strategic transport plan, which calls for a 50% increase in regional infrastructure spending across the north of England?
Richard Harrington
Infrastructure is a major pillar of the Government’s industrial strategy White Paper, and local input is essential. I welcome Transport for the North’s input, and I am sure that my right hon. Friend the Secretary of State for Transport will welcome this, too.
Jack Dromey (Birmingham, Erdington) (Lab)
The hostile takeover of GKN by Melrose threatens break-up, sale and closures. The Secretary of State has powers under section 58 of the Enterprise Act 2002 to intervene. Will he intervene to block this hostile takeover, which is not in the national interest?
Greg Clark
I have explained to other Members the importance of exercising these powers in the required way and of not giving a running commentary in this House.
Alex Chalk (Cheltenham) (Con)
Does the Minister agree that competitive rates of interest should be offered to businesses and subcontractors that are affected by the LARC collapse, and that the 8.64% offered to LARC Construction in my constituency is simply too high?
Andrew Griffiths
I agree with my hon. Friend that access to competitive finance is essential, not just for businesses affected by LARC, but more widely, and particularly for small businesses. I am happy to meet him to discuss the issues if he would like me to.
Mr Speaker
It is a great pleasure to welcome back to the House the hon. Member for Redcar (Anna Turley). I know that the House will join me in doing so.
Anna Turley (Redcar) (Lab/Co-op)
Thank you, Mr Speaker. It is great to be back.
We have ambitious plans on Teesside to create 20,000 jobs on the former SSI steel site. The biggest issue holding us back is, obviously, the ownership of the site. Can the Secretary of State update us on what conversations he is having with the official receiver and the Thai banks to enable us to fulfil our potential, create jobs, and bring investment back to the site?
Greg Clark
I welcome the hon. Lady back to the House and commend her for her commitment to ensuring that we secure the best possible future for that site. I shall visit Teesside shortly to continue our discussions. There is great commitment on the part of both the Government and the local development corporation to finding the right solution. The ownership is not in the Government’s hands, but everything that can be done is being done.
Michelle Donelan (Chippenham) (Con)
A constituent of mine is a director of Tower Supplies, one of the leading small and medium-sized enterprises in the personal protective equipment sector, whose bid was recently rejected by Transport for London in the first round of the process with no explanation. The practice is for feedback to be given, but that does not always happen. Will the Minister work with the Ministry of Housing, Communities and Local Government and other Departments to ensure that the system does not hinder SME growth?
Andrew Griffiths
The Government are committed to ensuring that more small businesses are able to bid for such contracts. We want to support SMEs through the procurement process, and to ensure that they can be competitive and win such contracts. I shall be happy to meet my hon. Friend and representatives of the company that she mentioned in order to find a solution.
Eleanor Smith (Wolverhampton South West) (Lab)
When I met the Minister last week, I was told that the Carillion headquarters would continue to operate in the interim. What steps are the Government taking to safeguard jobs for the employees who work in my constituency?
Andrew Griffiths
I think that the hon. Lady and I spoke on the telephone on the day of the insolvency, and I think I have met her twice since then, along with other Wolverhampton colleagues, to ensure that she is kept fully updated. We are working closely with PricewaterhouseCoopers and the Insolvency Service in the best interests of not just the creditors but all those employed in the Carillion network. To date, things have been positive, but I will seek to update the hon. Lady further as more information becomes available.
Mr Speaker
Order. I think that this point of order flows from the exchanges that we have just had. Although ordinarily points of order are made later, I will—as I sometimes do—take this one immediately after questions.
Gillian Keegan
Thank you, Mr Speaker. When I asked a question earlier, I neglected to say that I am a serving member of Chichester District Council.
Mr Speaker
That is a very belt-and-braces approach, for which the hon. Lady certainly cannot be criticised in any way. I thank her, as the House will, for what she has said.
Petition
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Helen Goodman (Bishop Auckland) (Lab)
The roll-out of universal credit continues to be a matter of concern in my constituency. Some of my constituents have been temporarily unable to pay their bills because of the long waiting period between one benefit and another, and the bailiffs were sent around. There is clear evidence of discrimination against women in the way in which the system works. People who have made national insurance contributions and lose their jobs do not get unemployment benefit as they used to on the basis of six months’ contributions if their husbands are in work. I am very grateful to Samantha Townsend, who has collected some 1,100 signatures.
The petition states:
The petition of residents of Bishop Auckland, Shildon, Spennymoor and Teesdale,
Declares that the Universal Credit programme is pushing people into poverty, debt and homelessness.
The petitioners therefore request that the House of Commons urges the Department for Work and Pensions to pause and fix Universal Credit before its rollout in Bishop Auckland, Shildon, Spennymoor and Teesdale.
And the petitioners remain, etc.
[P002096]
Leaving the EU: Economic Analysis
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Keir Starmer (Holborn and St Pancras) (Lab)(Urgent Question)
To ask the Secretary of State for Exiting the European Union to make a statement on the Government’s analysis of the long-term economic impact of Brexit on the economy.
The Parliamentary Under-Secretary of State for Exiting the European Union (Mr Steve Baker)
I will begin by setting out our approach to publishing economic analysis, I hope once and for all.
I can confirm that—I think the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) will want to listen to this. I can confirm that when we bring forward the vote on the final deal that we agree with the European Union, we will ensure that the House is presented with the appropriate analysis that the Government have carried out, so that the House can make an informed decision. All Members must surely agree, however, that the Government cannot be expected to put such an analysis into the public domain before it has been completed. That would misrepresent our views. Furthermore, the Government cannot be expected to publish the analysis while the negotiations continue, which would surely harm the national interest. Parliament has rightfully agreed that Ministers have a duty not to publish anything that could risk exposing our negotiating position.
Let me now turn to the article that prompted the urgent question. It is a selective interpretation of a preliminary analysis. It is an attempt to undermine our exit from the European Union. As I have told the House before, the Government are undertaking a wide range of analysis on our exit from the EU. The next stage of that analysis, summarised in a draft paper presented to Ministers this month, has been a cross-Whitehall effort to support our negotiating priorities. It has not been led by my Department, and it is not yet anywhere near being approved by Ministers. Even the ministerial team in my Department has only just been consulted on the paper, in recent days, and we have made it clear that it requires significant further work. In fact, I saw this report myself only this morning. The analysis to which I believe this article refers is a preliminary attempt to improve on the flawed analysis around the EU referendum. It is there to test ideas and to design a viable framework for the analysis of our exit from the EU. At this early stage, it only considers off-the-shelf trade arrangements that currently exist; we have been clear that these are not what we are seeking in the negotiations. It does not yet consider our desired outcome: the most ambitious relationship possible with the EU, as set out by the Prime Minister in her Florence speech.
Such an agreement is in the interests of both the UK and the EU. Therefore, the scenarios in this analysis continue to suffer from the flaws we have seen in previous analyses of this type. Such analyses have been proved to be wrong in the wake of the referendum, not least because there is huge uncertainty around any forecast, especially in the long run and especially in the context of a major strategic choice.
It is the Government’s job to improve on this analysis, but to do so we first have to understand where it went wrong previously. That is what the analysis to which this article refers is: it is not a forecast for our preferred outcome of the negotiations; it does not yet properly take account of the opportunities of leaving the EU.
Finally, on 23 June 2016 the people of this country took a decision to leave the EU in the context of a wide range of economic information. The purpose of this analysis is not to question that decision, which this House voted overwhelmingly to uphold. I hope all Members of this House will agree that we should continue to respect the result of the referendum.
Keir Starmer
Not good enough.
Here we go again: Brexit impact assessments, take two. For the past year, we have called on the Government to publish Brexit impact assessments. It is a simple argument: on decisions of this significance, Parliament is entitled to know the likely impact of the Government’s approach to Brexit and thus to hold the Government to account. The Government have repeatedly refused our requests.
Last year the Secretary of State initially insisted that these reports existed in “excruciating detail”, but were so sensitive that nobody else could see them. After this House passed a binding Humble Address, the Secretary of State changed tack, telling the Brexit Select Committee just last month that no “economic forecast of outcome” had ever existed. Yet last night we learn that an analysis has been produced after all.
This is now piling absurdity upon absurdity, and there are some pretty obvious questions. When was this new analysis commissioned? In particular, was it before or after the Secretary of State gave evidence to the Brexit Select Committee last month on this issue? Is this the only report that has been prepared on the Brexit scenarios? If not, what other analysis has been done? Does this new analysis model the Government’s Brexit approach? If not, why not? If so, will it lead to changes in Government policy? Finally, and most importantly, will the Secretary of State publish this now—not in nine months, but now, so that we can hold the Government properly to account?
We have been here before. It took a great deal of time last year and the use of a Humble Address to force the Government to release documents relating to Brexit. The Secretary of State has the chance today to avoid a repeat of that exercise if he commits to publishing this new analysis in full; will he do so?
Mr Baker
The right hon. and learned Gentleman raises the question of impact assessments, and what I can say to the House is that we have always been absolutely clear that we have a wide-ranging programme of analysis, which is evolving continually, but this economic analysis is not what is formally known as an impact assessment. [Interruption.] What I would say to the House—[Interruption.]
Mr Speaker
Order. There is excessive gesticulation from a number of hon. Members, which is unseemly and certainly unstatesmanlike.
Mr Baker
The right hon. and learned Gentleman and the Labour party are completely neglecting our duty to safeguard the national interest in the course of these negotiations. I can understand why he and those behind him would want the reports in the press to be accurate. Fundamentally, they do not wish to leave the European Union. For them, good news is a disaster and bad news is a welcome confirmation of their world view. They await each set of employment figures with eager anticipation, only to have their hopes dashed when every set shows an ever-increasing number of people in work. They gleefully celebrate warnings from banks about the possibility of jobs moving to the continent, then they have to retreat when, a few months later, the banks assert the supremacy of the City of London. I do not blame them. They care passionately about remaining in the European Union and they want to overturn the result, but their strategy is becoming clear: demoralisation, delay and revocation. However, that is not what our parties stood for at the last election. Our parties were clear that we would respect the result of the referendum, and that requires the Government to deliver the best possible Brexit. That is what we are trying to do.
As I said in the opening words of my reply, when the time comes for a meaningful vote, the Government will ensure that the House is appropriately informed. However, we can see what some of this economic analysis could be worth. Let us take as an example the respected Bank of England. What institution could be more respected for its analysis? In August 2016, it made a quantitative forecast of the impact of Brexit, saying that exports would go down by 0.5%, but they went up 8.3%. It said that business investment would go down by 2%, but it went up by 1.7%. It said that housing investment would go down by 4.75%, but it went up by 5%. It said that employment growth would be zero—flat—but it went up to a new all-time high. The public deserve to see the national interest protected in these negotiations and to have a House of Commons of representatives who exhibit a healthy scepticism about economic forecasting.
Mr Kenneth Clarke (Rushcliffe) (Con)
It is perfectly obvious to everyone on both sides of the channel that if the United Kingdom leaves the largest and richest multinational free-trade area in the world and constructs new barriers by way of tariffs, customs or regulatory barriers between ourselves and that market, future generations will to some degree be poorer than they would otherwise have been. Does the Minister not accept that the Government should feel themselves under a duty to have the best-informed debate in this House and in the country on the possible consequences of likely scenarios now, when the Government are deciding what their ultimate policy is going to be, and continuously throughout the vital next 12 months when the final picture will start to emerge? Will the Minister stop pretending that this is something to do with defending our negotiating position or that it is some kind of perverse attempt to reverse the referendum decision, and accept that he has failed, actually, to protect the Government from political embarrassment?
Mr Baker
The public have made a profoundly important strategic choice, which is to leave the European Union. That means that the Government need to deliver free trade on a new basis: on the basis not of political integration but of a new deep and special partnership with the European Union. It is the Government’s intention to deliver the best possible and most frictionless trading with our friends in the European Union, which it is in all our mutual interests to do. My right hon. and learned Friend talks about our duty, and he knows well that our duty is to look after the national interest of our constituents and of our country. That is exactly what we are seeking to do as we take these negotiations and this analysis forward.
Stephen Gethins (North East Fife) (SNP)
Just yesterday, I was commenting in this Chamber that the only constants in the Government’s Brexit position are chaos and confusion. Far be it from me to get in the way of the Government undermining themselves, or of Tory feuding, but this situation counts, and their bluff and bluster just will not cut it any more. It is striking that the figures that have been released are very similar to the figures that the Scottish Government produced on Scotland’s place in Europe. If the Scottish Government can produce their figures, why can this Government not do so?
Mr Baker
I reassure the hon. Gentleman that we are not copying the Scottish Government’s analysis and that we are doing our own homework. The Scottish National party’s position is clear: it wants to break up the United Kingdom and have a Scotland within the European Union. The actions that he describes must be understood in that context.
Philip Davies (Shipley) (Con)
We have here some London-centric remoaners—that could be a way of describing the shadow Brexit Secretary—in the civil service who did not want us to leave the European Union in the first place and put together some dodgy figures to back up their case. They still do not want us to leave the European Union and are regurgitating some dodgy figures to try to reverse the result of the referendum. Does my hon. Friend agree with that analysis? If so, does he agree that this really is not a news story?
Mr Baker
My hon. Friend makes a point that is very much in line with his long-held views. I should reaffirm that I am proud of the officials with whom I work. Irrespective of how they voted, they are demonstrating commitment to delivering on the decision of the British people. The intention of our current analysis is to improve on what has gone before and, as I set out in my initial response, we recognise that there were flaws in the previous approach.
Hilary Benn (Leeds Central) (Lab)
A lack of transparency is not in the national interest. On 6 December, I asked the Brexit Secretary,
“have the Government undertaken any impact assessments on the implications of leaving the EU for different sectors of the economy?”
He replied, “Not in sectors.” Now we learn that that work has been done, and it is reported that chemicals, clothing, manufacturing, food and drink, cars and retail will be the hardest hit sectors. Will the Minister offer the House an explanation for the discrepancy between what the Exiting the European Union Committee was told and what we now know?
Mr Baker
As I have explained, we have always said that our economic analysis was continually evolving across a wide range of activities—[Interruption.] Opposition Members laugh, but what else would they expect but for the Government to work continually on a developing analysis? As I may not have said in my opening remarks, I know that the Secretary of State only saw this particular document last night—I saw it this morning—and I think that that will explain the answers he has given.
Rachel Maclean (Redditch) (Con)
Does my hon. Friend agree that businesses up and down the country, including in Redditch, will wonder whose side the Labour party is on when its Members take great pleasure in forecasts that predict doom and gloom? People may conclude that Labour is not on the side of this country’s hard-working businesses and entrepreneurs.
Mr Baker
My hon. Friend is exactly right. Now that the decision has been taken, the vast majority of right-thinking people in the United Kingdom will expect it to be carried through with a good heart as a matter of choice. Time and again, we see a foot-dragging reluctance from the Labour party, which increasingly seems not to be respecting the choices of its own voters.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
It is reported that the analysis shows that the north, the midlands and Northern Ireland will be hardest hit in all the scenarios. Will the Minister confirm that that is because all the scenarios assume that Britain is outside the customs union? Will he confirm, too, that the Government appear to have undertaken no analysis of the different customs union options and of the impact on our economy? Given how significant the situation is for northern manufacturing and for Northern Ireland and given that the CBI has said this is irresponsible and is letting down northern manufacturing, will he commit to conducting and publishing analysis before the customs Bill completes its passage through Parliament?
Mr Baker
I am grateful to the right hon. Lady because she has given me the opportunity to reassure her that there is economic growth under all the scenarios in the economic assessment. The only question is to what extent and how fast, but there is projected to be economic growth across a 15-year period in all the scenarios.
Sir Nicholas Soames (Mid Sussex) (Con)
Does my hon. Friend understand that many businesses in my constituency are already nervous about the apparently cavalier attitude of some Brexiteer opinion towards their continued success? Will he therefore confirm that the Government will seek to negotiate an arrangement and get a result that does not damage the long-term economic success of our country and the national interest of our people?
Mr Baker
I can give my right hon. Friend that assurance. The Government are not cavalier. It is precisely because we take our duties seriously that we are continuing to develop our economic analysis, and I can of course reassure him that we are seeking to establish a free trade agreement and other partnership arrangements that are of unprecedented scope and ambition.
Mr Chris Leslie (Nottingham East) (Lab/Co-op)
For the Minister basically to excuse his not publishing the information because he has not yet had the chance to edit, twist or distort it or to redact the information within it is a total and utter disgrace. The public have a right to know about their livelihoods and their futures, and it is deeply irresponsible and dishonest for the Government not to publish the information. It is a cover-up, pure and simple, and it stinks.
Mr Baker
I congratulate the hon. Gentleman on going for the hardest possible hit that he can manage, but it is not good enough. The truth is that the hon. Gentleman has made it perfectly clear through his words and his actions that he does not accept the referendum result. It is perfectly clear that he is among those who wish to seek a revocation of the democratic decision of the British people, and he is acting in that spirit.
Sir Desmond Swayne (New Forest West) (Con)
As an antidote, will the Minister read Professor Minford’s work? Alternatively, he might just go to the cinema to see “Darkest Hour”.
Mr Baker
I am extremely grateful to my right hon. Friend. I can confirm that I will read Professor Minford’s work, and the transparency register will also show that I have met Professor Minford. I will continue to meet Professor Minford and to look at the work of Economists for Free Trade.
Tom Brake (Carshalton and Wallington) (LD)
As the Cabinet squabbles in the middle of these tough negotiations, the Minister has no right to talk about the national interest. He must stop treating parliamentarians like chumps. He knows, we know and this analysis confirms that Brexit will cause huge damage to British jobs and British families. Will the Government and, indeed, the Leader of the Opposition now allow a vote on the deal so that the people can decide whether they want to pursue this damaging approach or to stay in the European Union?
Mr Baker
The right hon. Gentleman reminds me that I did not answer the other point of my right hon. Friend the Member for New Forest West (Sir Desmond Swayne). I have been to see “Darkest Hour” and the right hon. Member for Carshalton and Wallington (Tom Brake) does a good job of reminding me that some people do approach our current circumstances in an unnecessarily bleak spirit. I say to him once again that the economic analysis is clear that there is to be economic growth in all scenarios. I encourage him to go back to the report published by the Treasury Committee, on which I served, during the referendum campaign and look at the documented abuse of figures by the remain campaign. I urge him not to repeat that abuse of figures.
Antoinette Sandbach (Eddisbury) (Con)
According to this analysis, the car manufacturing, chemical and food sectors, all of which are vital for my constituency, will clearly be adversely affected. Quite frankly, Minister, I take exception to being told that it is not in the national interest for me to see a report that would allow me to best represent my constituents. Parliament needs access to the best possible information on which to base our decisions.
Mr Baker
I have great faith in my hon. Friend, and we of course appreciate the importance of cars, chemicals and food. As I said at the beginning of my response, when the time approaches for us to have a meaningful vote in Parliament, we will put appropriate economic analysis before both Houses to assist the choices that they make. However, we do not expect the European Union to publish all its analysis in a transparent manner, and we do not propose to go into the negotiations having revealed all our thinking.
Kate Hoey (Vauxhall) (Lab)
I wonder whether the Minister thinks that perhaps the person in the Whitehall establishment who leaked this document would be better off moving, and working in Brussels. Was the methodology used in this report, or whatever it is, the same methodology that said the country’s financial future would tank if we did not join the euro?
Mr Baker
We are carrying out the usual inquiries into who leaked the report. The hon. Lady is absolutely right that past economic predictions have been very poor, and poor for good reasons on which I would love to elaborate on another occasion. I have set out that particular critique of even the Bank of England’s forecasts, and she is absolutely right that, as I said earlier, we should have a healthy scepticism.
Mr Bernard Jenkin (Harwich and North Essex) (Con)
We would be in a strange position if Governments had to publish every bit of advice to Ministers and every bit of analysis that they profoundly believed to be wrong. The last Labour Government did not do that, and the Minister should resist publishing this analysis if he believes it is not in the national interest to do so. I also advise him that people are trying to divert the Government’s direction on Brexit—there is absolutely no doubt about it. Will he look into why this particular document was leaked on this particular day, the day that the withdrawal Bill has its first debate in the upper House?
Mr Baker
My hon. Friend, the Chairman of the Select Committee on Public Administration and Constitutional Affairs, makes an important and authoritative point about the conduct of government. Opposition Members would do well to reflect on how they would wish to govern the country if, God forbid, the electorate should ever give them an opportunity to do so.
All of us in this House need to have an eye on the long-term functioning of our democracy and our constitution. With that in mind, I hear what my hon. Friend says. There is clearly a campaign to overturn the referendum result, and it can be seen at work in the media and in this House. We will certainly bear in mind what he says.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
The Minister says that this cross-departmental analysis has not been co-ordinated by his Department, but on that there appears to be some confusion. When the Brexit Secretary gave evidence to the Brexit Committee last week, I asked him whether his Department is co-ordinating the cross-departmental work on the sectoral impacts of no deal, and he said, “Yes.”
If there is indeed no deal, we would likely fall out on World Trade Organisation rules. Will the Minister confirm that in one of the scenarios outlined in the report—the WTO option that is advocated by many Conservative Members—the impact of non-tariff barriers is the equivalent of a 10% tariff slapped across the economy?
Mr Baker
That was quite a long question. There are two particular scenarios that are not modelled in this analysis. One is the policy choices that the Prime Minister rightly set out in her Florence speech, and the other is exiting in the unfortunate, and we think unlikely, circumstance of not reaching an agreement and how one might take the right policy choices in the event of trading on WTO rules. We will continue to take this analysis forward, and I look forward to the day when we are able to present appropriate analysis to the House before the meaningful vote.
Mr Peter Bone (Wellingborough) (Con)
Does the Minister recall, prior to the referendum, what became known as “Project Fear”? Everything was going to go wrong after the referendum if we voted to come out—something short of bubonic plague—but that did not happen. With those warnings, the British people still voted to come out, so of what relevance is another forecast now that predicts exactly the same as “Project Fear”?
Mr Baker
My hon. Friend makes a good point, and I well remember “Project Fear” in all its manifestations. Most of us on the leave side thought at the time that those horror predictions would not come to pass after the vote and, happily, we have been proved correct. I look forward to continuing to prove economists wrong after they make horror story predictions.
Mr Ben Bradshaw (Exeter) (Lab)
Why have the Government assessed the impact of all the scenarios but not the one they say they want, the fantasy cake-and-eat-it one?
Mr Baker
I am grateful for that question, because I can reassure the right hon. Gentleman and the House that we will continue to develop and expand our economic analysis. We cannot control the timing of leaks, and were we to have chosen to publish an analysis, as we will when we approach the meaningful vote, it will of course contain the relevant information.
Stephen Hammond (Wimbledon) (Con)
My hon. Friend is of course right that this analysis does not question the result of the referendum, nor does it model his desired scenario, but what it does show is that modelling a fully comprehensive free trade deal with the EU post-Brexit, combined with the benefits of new trade deals, shows a net effect on economic growth of 1.5%. Where does he hope a special and deep relationship will differ from a fully comprehensive free trade deal post Brexit?
Mr Baker
My hon. Friend may know that Michel Barnier tried to include financial services in the Transatlantic Trade and Investment Partnership deal, and we believe that we can go beyond what has been agreed in the past. The analysis does not include a comprehensive deal of the scope we would like to agree; it includes only an average based on past precedents. We believe that we can reasonably go further than we have before, and of course we are well apprised of the importance of financial services and of ensuring that the City flourishes.
Joanna Cherry (Edinburgh South West) (SNP)
If the economic forecasts and impact assessments published to date have been so wrong, why do the Government not tell the British people what it is they want from the EU by way of a deal, cost it and publish the results? Why is that so difficult?
Mr William Wragg (Hazel Grove) (Con)
Can my hon. Friend, the excellent Minister, name a single civil service forecast, leaked or otherwise, that has been accurate?
Mr Baker
No, I am not able to name an accurate forecast. They are always wrong, and wrong for good reasons. [Interruption.] Members are chatting at me from a sedentary position. My long-standing views on the flaws in the epistemology of the social sciences and the consequences for econometrics are well set out in various forums, and I encourage Members to go and have a look at them. I am happy to recommend a reading list.
Chuka Umunna (Streatham) (Lab)
The Government are not protecting the interests of the British people but withholding information from them. The Minister keeps invoking the referendum, but of course that did not give us any indication of the form of Brexit that the public wish us to follow. Will he confirm that what the analysis shows is that the least worst option—staying in the single market and customs union—has been voluntarily taken off the table by the Prime Minister with no mandate whatsoever?
Mr Baker
I encourage Members to google the hon. Gentleman’s name on The Sun website. They will find a wonderful picture of him, during the referendum, standing next to a poster proclaiming that the leave campaign wanted to leave the single market. He made the point at the time—[Interruption.] He certainly did, and anyone can go and find it on The Sun website. The point was made at the time, and the public chose.
It would not be possible to honour the decision of the British people if we allow the European Union to set the UK’s tariffs and if we become people in a political purgatory of perpetual rule taking from the European Union without any democratic say. It is the desire of this Government that our country should continue to be a democracy. For that reason, we will leave the European economic area and the customs union.
Mr David Jones (Clwyd West) (Con)
Does my hon. Friend agree that our post-referendum experience illustrates the danger of publishing incomplete and inchoate economic analyses? We were told prior to the referendum by the Treasury that we would enter immediate recession if we voted to leave. The International Monetary Fund told us that the economy would contract by as much as 9.5%. Both were made to look extremely foolish.
Mr Baker
My right hon. Friend is exactly right, and he might have added to that catalogue of failures of the economics profession the failure to see the financial crisis. It is time for economists to re-examine their methods, for the reasons I indicated earlier. I am grateful to him for putting those past failures on the record.
Heidi Alexander (Lewisham East) (Lab)
Given that the leaked Government analysis confirms that, realistically, there are three ways that the UK might leave the EU, each with a very different impact on jobs, trade and livelihoods, why have MPs not been given a direct vote at the start of the process to determine what sort of Brexit the UK is pursuing? Is it not about time that we in this House are allowed to take back common sense and seek the sensible option of staying in the single market by staying in the European economic area and remaining part of a European customs union?
Mr Baker
The hon. Lady is entirely wrong; the sensible and pragmatic way forward, which honours the result of the referendum and ensures that this is a democracy with an independent Parliament able to ensure that control is exercised over the laws of this country, is to carry forward my right hon. Friend the Prime Minister’s policy, as she has set out in Florence and in the Lancaster House speech.
Dr Julian Lewis (New Forest East) (Con)
Is it not about time we set up a charity called “Soothsayers Anonymous” for people who simply cannot kick the habit of predicting when conflicts are going to break out, when we are going to have opinion polls that are going to be accurate and when we are going to have economic forecasts regarding the EU that are going to be accurate, even though history has shown time and again that they are not worth the paper they are written on?
Lady Hermon (North Down) (Ind)
The Minister will be well aware that Sinn Féin has already used the Brexit decision to agitate for a border poll. I say to the British Government that they need to be very careful to ensure that Sinn Féin does not use any more negative impact assessments to feed its narrative. In those circumstances, what guarantees can he offer the people of Northern Ireland that the economy will not suffer as a result of Brexit? We must make sure not to feed Sinn Féin’s narrative.
Mr Baker
The hon. Lady makes a sobering and important point, which the Government have heard. I say to her that in all scenarios in this economic analysis, there is economic growth—the question is only: how fast? It is this Government’s task to ensure we achieve the fastest GDP growth and indeed the fastest GDP growth per head, which is why we have brought forward a comprehensive programme on productivity. Of course we are most concerned to ensure the prosperity of the people, not only of Northern Ireland, but of the whole of the island of Ireland and right across Europe. That is why it is in our mutual interest to agree a comprehensive and deep free trade agreement.
Stephen Crabb (Preseli Pembrokeshire) (Con)
Even though these forecasts do not look at the Government’s preferred outcome, does my hon. Friend not agree that the data they contain, however imperfectly, do underline the importance of building a bespoke deal around maintaining customs union-style arrangements and ensuring as great a level of access as possible to the single market?
Mr Baker
I agree with my right hon. Friend on most of his points, but, as I said in an earlier answer, we do not think remaining in the customs union, so that the European Union set our tariffs on imports, would be the right thing to do. We think that would be the wrong choice for the UK. It would prevent us from operating an independent trade policy and plugging ourselves into the rest of the world’s growth, where multiple authorities, including the European Commission, have admitted that 90% of the world’s growth will come from. So on that particular point I disagree with him, but on the rest of his arguments and, in particular, on the need, in our mutual interests, for a good-quality trade agreement, he is right and I agree.
Mr Pat McFadden (Wolverhampton South East) (Lab)
Ministers keep using the excuse that it is in the national interest to withhold information about the economic impact of Brexit—that is on the days when they admit such information exists. I will tell them what is really not patriotic: pursuing a policy that will make our country poorer than it would otherwise be, in order to satisfy right-wing, nationalist ideology. So will the Minister desist from saying that it is in the national interest to withhold this information, given that the only interest it serves is that of Tory Ministers embarrassed by its contents?
Mr Baker
I simply do not accept the premises of the right hon. Gentleman’s question; he makes ludicrous suggestions. I consider myself to be an old English liberal and I think most of the Eurosceptics with whom I associate also consider themselves liberal in outlook, particularly on matters of trade and the economy. With that in mind, I cannot possibly accept his premise. The fact is that we are in a negotiation and no one seriously would expect us to go into—
Mr Baker
The right hon. Gentleman says I should wash my mouth out, but I am happy to debate liberalism with him any time.
We are heading for an open, liberal, free trading future for the UK. Any suggestion of nationalism is quite wrong and quite ludicrous, and the right hon. Member for Wolverhampton South East (Mr McFadden) should retract.
Mr Speaker
The right hon. Member for Carshalton and Wallington (Tom Brake) looks as though he has just consumed a very bitter lemon, but I hope he recovers.
Mr Philip Hollobone (Kettering) (Con)
Does my hon. Friend share my dismay that pro-remain Members of this House who represent constituencies that voted to leave leap on incomplete economic analysis and profess deep understanding of complex economic methodology, yet fail to wrap their minds around the simple arithmetic of the referendum, which was that 52% voted to leave?
Mr Baker
I must exercise some caution, Mr Speaker, because as you will know, Wycombe District, which is substantially larger than the constituency of Wycombe, did express the other view. However, what I think we need to do is come together to unite around the result as a country, and to choose for ourselves not to leave the EU because we must or because we ought, but to leave the EU successfully because we choose to abide by the democratic decision of the United Kingdom as a whole.
Wera Hobhouse (Bath) (LD)
How can we unite together when the Government are withholding information from the rest of the House?
Mr Baker
It is very difficult to answer the question of how we can unite together when certain Members of this House, including, I am sorry to say, the hon. Lady, keep provoking as much division as possible. She represents a party claiming to be liberal and democratic, and which once offered a real referendum on Europe, but we have had a real referendum on Europe and it is time for her to get behind the result.
Mr Marcus Jones (Nuneaton) (Con)
The gloomy pre-referendum Treasury forecasts led many of us to vote remain with a heavy heart. The public made their decision, and we stood on an election manifesto saying that we would follow through on that decision. Will the Minister tell me why we should believe part forecasts—these forecasts, which have apparently been published, are not complete—given that the initial information put out before the referendum was flawed?
Mr Baker
My hon. Friend makes a very good point, and “Project Fear” was mentioned earlier. It is most unfortunate that one fundamental tactic always used throughout the long and sorry history of misrepresenting the true purpose of the EU has been to demoralise the public. It is time for each of us in this House to take a lead in going forward in a spirit of buoyancy and hope.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
The Minister would not accept the premise of the question from my right hon. Friend the Member for Wolverhampton South East (Mr McFadden), but this morning we heard from the former Secretary of State for Work and Pensions, the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith), who cast significant doubt on the Government’s own ability to forecast the impact of Brexit on jobs and growth. What assurances will the Minister give workers in my constituency, for example, those in the Jaguar Land Rover or Vauxhall supply chains, that Brexit will not fatally wound the manufacturing sector on Merseyside?
Mr Baker
As I believe the record will show, I have said multiple times that in all scenarios in this economic analysis growth is forecast. So it is good news for the hon. Lady and for the country that in all of the forecasts—in all of the circumstances of the economic analysis—growth is forecast. She brings up the issue of the supply chain, so I also say to her that we are of course apprised of the imperatives of complex international supply chains, not just between the UK and Europe, but around the whole world. In particular, I draw attention to provisions in the Union customs code for inward and outward processing rules, which should assist manufacturers in her constituency.
Mr Richard Bacon (South Norfolk) (Con)
Were the economists involved in these forecasts the same ones who said we would lose half a million jobs if people voted for Brexit? Since the referendum we have, in fact, gained 350,000 jobs.
Mr Baker
I am not able to give my hon. Friend exactly that information, but perhaps some of the economists are the same ones. In my experience, civil servants, at all levels, dutifully carry out the instructions of the Government, and I am sure they are doing that in this case.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
It might surprise the Minister to learn that I have read a number of his articles, and there is much in them that I disagree with. He talks a lot about liberty, accountability, transparency and democracy, but he does not seem to like any of those principles when they are applied to him and his Government, and when they shed light on the reckless course that this Government are pursuing. If they have not done a full, comprehensive analysis, they are incompetent. If they have done it, we should see it.
Heidi Allen (South Cambridgeshire) (Con)
No one in this House should dismiss the referendum result—that would be overstepping the mark—but it is our role, as the Government have accepted, to scrutinise the deal and ensure that it is the very best it can be for all our citizens, regardless of how, or indeed whether, they voted in the referendum. The impact assessments were made available to parliamentarians in absolute confidentiality, and I went to see them. I fail to see why that same process cannot be extended for this most recent and any further analysis. This is a one-time deal only, and I for one owe it to my constituents to prove to them that I have exercised full scrutiny.
Mr Baker
I cannot accept the premise of my hon. Friend’s question. We have gone to and fro in the House about the meaning of the term “impact assessments”. What was made available to colleagues were sectoral analyses. I refer my hon. Friend both to the written ministerial statement setting out how meaningful votes will happen at the end of the process and to my previous remarks about the need to protect the integrity of our negotiating position. We will ensure that, when we reach the end of the negotiating period, parliamentarians are able to access appropriate economic analysis when we all take that important decision.
Wes Streeting (Ilford North) (Lab)
Last week, I asked the Treasury’s permanent secretary whether he could confirm that just a single one of the Government’s scenarios for a deal post brexit would lead to a better economic deal and outcome than what we have as members of the single market and customs union. He did not seem able to answer. Is not the truth that no such model exists? Has it not been confirmed today that, as a result of the Government’s dogmatic determination to pull us out of the single market and the customs union, it will not be my city, London, that is most affected, or indeed the industries in the City of London that are worst affected, but the key sectors of the economy right across the UK, with the impact felt worst in the west midlands, the north-east and Northern Ireland? How on earth could that possibly be in the national interest?
Mr Baker
The hon. Gentleman said that there is no such model; the truth is that my right hon. Friend the Member for New Forest West (Sir Desmond Swayne) referred to a model earlier. Economists for Free Trade are very clear about their modelling. Other models are available—at the time of the referendum, Open Europe did some modelling and found that the effect could be plus or minus 2%. The truth is that there are profound uncertainties facing not just the United Kingdom in this negotiation but all economies in the world. All face three big issues: the growth of technology; a new phase in globalisation; and, of course, the continuing aftermath of the financial crisis which, as the hon. Gentleman well knows, has left interest rates at levels the Governor of the Bank of England has described as extraordinary if not emergency. Those three issues mean that all economies are on highly uncertain paths. The Government will navigate their way through the future with confidence and boldness.
Charlie Elphicke (Dover) (Ind)
Is the Minister aware that in the past 40 years the European Union’s share of global GDP has fallen from 30% to just 15% and that 90% of future world economic growth is going to come from outside Europe? Does he agree that the future is not regional relative decline; the future is global?
Mr Baker
I do agree, and my hon. Friend makes an extremely good point. We need to make sure that this country is well positioned. He refers to the previous era of globalisation and particularly the emergence of China. The United Kingdom’s task is to take the right strategic decisions so that we can be plugged in not only to Asia but, I very much hope, to an emerging Africa, Latin America and the whole world, and so that we can participate on the basis of technologies that were unimaginable at the beginning of the EU’s life, not least the internet, inexpensive air travel and containerised shipping. Those three things have transformed our world for the better, and I hope and expect, as I am sure my hon. Friend does, that in future, over the course of our lifetimes, the world will improve in ways that we cannot yet imagine.
Emma Reynolds (Wolverhampton North East) (Lab)
We have learned today that the Government’s own analysis suggests that the economy will grow by less than 5% in the case of a UK-EU trade deal. That is people’s jobs and livelihoods. Will the Minister confirm that the Government’s negotiating position has been decided not on the basis of the economic evidence but on ideology alone?
Mr Baker
Let us not pretend that there is no ideology among those who wish to remain in the European Union, even at the cost of overturning a democratic decision, remaining in the EEA and surrendering democratic control and power. The figure to which the hon. Lady referred is wrong—it is not as she stated—but I do not propose now to walk through what is in the analysis which, as I have said, is currently a provisional draft and is not yet Government policy.
Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
On Friday, the Secretary of State for Exiting the European Union was on Teesside to set up an optimistic free-trading vision for the UK after we leave the EU. Given that all estimates have consistently underestimated our economy, surely it is time to just get on with the job.
Alison McGovern (Wirral South) (Lab)
The Minister is clearly making himself out to be a bit of a philosopher today, so I say to him that surely it is the mark of a democracy that those of us who take different sides do not question each other’s patriotism. If he does not trust the forecasts, will he take the sensible decision—like the one taken by the previous Chancellor, George Osborne—to get them out of the Treasury and say to the Office for Budget Responsibility, “You get the forecast done by the time of the spring statement”? Then we can all see what the truth is.
Mr Baker
I have been careful not to use the word “patriotism” and not to question anyone’s, but the voters of the United Kingdom are entitled to look at the words and actions of their parliamentarians and ask what they are trying to achieve. Are they committed to adhering to the referendum result? Are they doing so with a spirit of confidence and boldness, and with buoyancy and hope, or are they trying to demoralise the public and overturn the result through delay and revocation? The hon. Lady should think very carefully about what her voters—and, indeed, all our voters—will think about our actions. I hope she will commit to carrying through their democratic decision.
Richard Drax (South Dorset) (Con)
It is in the national interest to get the best deal we possibly can. Does my hon. Friend agree that to do that we have to keep our cards close to our chest? These are tough negotiations, and to expose the goods and the bads in such negotiations plays right into the hands of an organisation that, let us face it, does not want us to leave anyway.
Mr Baker
I think the EU’s willingness to see us leave is increasing by the day as we go through this process. It is important that the House knows that key figures throughout the EU pay close attention to our newspaper headlines, so it is important and incumbent on us all to remain committed, in that spirit of buoyancy and hope, to carrying through the referendum result.
Sammy Wilson (East Antrim) (DUP)
We have been here before, because the same gloom-laden forecasts were made before the referendum and none of them was anywhere near the mark. Does the Minister agree that these long-term forecasts are as useful for predicting future economic performance as newspaper horoscopes? More importantly, will he assure us that despite the hysteria from the Opposition Benches, the Government will not be distracted from honouring their commitment to deliver the United Kingdom out of the single market and the customs union?
Jeremy Lefroy (Stafford) (Con)
Another great economist, J. M. Keynes, said, “When the facts change, I change my mind. What do you do, sir?” Will my hon. Friend confirm that a deep and special partnership must include services as well as goods, because services account for 80% of our economy, and that any deal that did not include all services would not be in the interests of the United Kingdom?
Mr Baker
Of course I agree with my hon. Friend about the importance of services, but I go further. It is extremely important that our ambassador to the World Trade Organisation, Julian Braithwaite, is chairing the relevant committee on services. It is in the UK’s and, indeed, the world’s interests that we take part in a global liberalisation of services in trade. That is key to unlocking the UK’s prosperity and, indeed, to unlocking Governments’ capacity to meet the commitments that they have entered into for their populations.
Andy Slaughter (Hammersmith) (Lab)
My constituents, many of whom are former Conservative voters, cannot understand why any Government would adopt policies that they knew would make them or the country worse off. The Minister’s tactic today is to rubbish his own commissioned analyses because they show that leaving the EU will be an economic disaster, to a greater or lesser extent. If he believes in Brexit at any cost, will he at least have the honesty to say so?
Mr Baker
The shadow Minister says it is nonsense, but I can assure him that it is not. The economic analysis shows GDP increasing in all circumstances. The point of the Government’s policy must be to carry through faithfully the decision of the British people and to do so in a way that proves these doom-mongers and naysayers wrong.
Kevin Foster (Torbay) (Con)
In these negotiations, the UK is on one side, and 27 other Governments and the EU are on the other. Will my hon. Friend say how many of those Governments, as well as the EU itself, have confirmed that they will publish the entirety of their internal analysis on each option that they might be prepared to offer?
Mr Baker
I am very grateful to my hon. Friend for his question. I am not aware that any of them is prepared to reveal that information, and he was absolutely right to mention it. I can assure him that I have given instructions to our teams to analyse the interests of other member states simply for the purpose of demonstrating that it is in our mutual interests to conclude a deep and special partnership.
Several hon. Members rose—
Mr Speaker
As there is so much noise, I will call someone who has been behaving in a statesperson-like manner. I call Fiona Onasanya.
Fiona Onasanya (Peterborough) (Lab)
I refute the accusation that we do not accept what our constituents have voted for. In June, they were asked a simple question, which was something like this: would you like a divorce, yes or no? They answered that question, but they did not know who would have the children, who would get the house, and how the assets would be split. Will Ministers give us the detail of the impact analysis that has been done, so that we can advise our constituents on how leaving will affect them?
Mr Baker
The hon. Lady makes a very interesting point, but I slightly regret her metaphor. We need to face up to the fact that the British public have rejected the idea of delivering free trade through political integration. Our task is to rise to the challenge of this new decision in strategic political economy and deliver free trade, which provides for democratic control of political power. I did listen carefully to what she said.
Simon Hoare (North Dorset) (Con)
It is with growing admiration that I listen to the pronouncements of the Mystic Megs, and indeed the Mystic Moggs, who, with near papal infallibility, pronounce this, that or the other as being an absolute certainty. I agree with the Minister when he says that this is an uncertain process. All my constituents and businesses in North Dorset want to hear from the Minister is that he and the Government are committed to a pragmatic, common-sense solution to this issue that we are facing, to ensure economic growth, stability in jobs and prosperity in Dorset.
Mr Baker
As I said in an earlier answer, I believe that that pragmatic way forward is as set out by our right hon. Friend the Prime Minister in the Lancaster House and the Florence speeches, and I am grateful to my hon. Friend for underlining the fact that it is the right way forward.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
How dare the Minister suggest to my constituents that ignorance is bliss! My constituents were misled by the lies on the side of the Brexit bus. My constituents are now being deprived of the information that suggests that, up and down the north of England and in Yorkshire in particular, jobs and employment will plunge if we go out on the worst terms. Will he apologise to my constituents for misleading them?
Mr Baker
No, I will not. I encourage the hon. Gentleman to listen to the arguments that I have made and to the answers that I have given. In all scenarios in this analysis, economic growth increases. He talks about people being misled in the referendum campaign; there were two campaigns and both are susceptible to criticism. I encourage him to look at the Treasury Committee’s report, which criticised the remain campaign quite heavily; otherwise, I should not have been able to sign up to it.
Vicky Ford (Chelmsford) (Con)
In my constituency, more than 2,000 people work in insurance. Britain is home to the world’s largest insurance market, and many European companies need access to our market. Does the Minister agree that it is in the interests of both Britain and Europe to seek a much deeper and more modern trade relationship than the EU has with any other third country?
Mr Baker
I do agree with my hon. Friend. The United Kingdom has a comparative advantage in insurance, as it does in so many financial services. As I indicated earlier, it is in the interests of Europe and the world that we should be able to take that comparative advantage and put it to the service of the whole world.
Albert Owen (Ynys Môn) (Lab)
Like that of the right hon. Member for Preseli Pembrokeshire (Stephen Crabb), who is no longer in his place, my constituency is the gateway to Britain from the Republic of Ireland and on the frontline of Brexit. Businesses that I have spoken to in the past few weeks and months want, because of the uncertainty, an analysis of what Brexit will mean for them specifically. Will the Minister tell the House when he was intending to share this information with local authorities, the devolved Administration and, indeed, their MP who needs to keep them informed?
Mr Baker
I can tell the hon. Gentleman that the Under-Secretary of State for Exiting the European Union, my hon. Friend the Member for Worcester (Mr Walker), has been in contact with the Port of Holyhead, and we will continue our programme of engagement, well apprised of the need to keep talking to businesses, particularly those that provide our important infrastructure, such as the port in his constituency. He asked me when: I have said that, before the meaningful vote, we will make appropriate economic analysis available to the House.
Huw Merriman (Bexhill and Battle) (Con)
During referendum week, I was fortunate to speak to 25 schools, taking a neutral position. I visited two schools in the past fortnight, and the vast majority of the students, who would probably have voted to remain, wanted us to get on with the job rather than unpick it. Does the Minister agree that it is essential that we respect the ballot box system that elected us, engage more with our constituents and get on with the job in hand?
Mr Baker
I do agree with my hon. Friend. I particularly lament the way that so much of the demoralisation that has taken place has been aimed at young people. It is precisely because we are concerned for their future that we want to deliver a successful partnership with the European Union as we turn out to take advantage of that growth, 90% of which will come from the rest of the world. It is their future that we are concerned about, and it is their future that led people like me to campaign for leave on the basis of upholding their democratic choice to choose a Government and influence its policies.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
These leaked figures indicate and expose the damage that will be caused by a Brexit outside the single market and the customs union. Is it not the case that the greatest failure of this Parliament, on the biggest issue of our time, and despite the damage that it will do to people’s livelihoods and standards of living, is that the British Government and the Labour Opposition share the exact same position?
Mr Baker
As I have already said, all scenarios in this analysis show growth. The analysis is heavily caveated with the profound uncertainties that exist, not only for the UK and Europe but for the world. In that context, I hope that the hon. Gentleman will accept the answers that I have given today.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
Following directly on from that, is it not right that we should approach such economic modelling with caution? History has proven to be wrong and flawed in the past. The information is incomplete. Does my hon. Friend, and philosopher longstanding, look forward to proving this analysis wrong as well?
Lilian Greenwood (Nottingham South) (Lab)
What duty does the Minister owe to the British people, including my constituents, if not to tell the truth about the choices in the negotiations before us and what they will mean for jobs and businesses in Nottingham?
Mr Baker
Over the long course of the history of the European Union, and indeed of the referendum campaign, people have not shown a particular willingness on a very wide scale to engage in the details of trade policy. This is an area where they do expect the Government—[Interruption.] The hon. Lady says something about our duty. Our duty is to get on with the job that the people have given us to do not only in answering the referendum question telling us that they wish to leave the EU, but in voting at the general election for a range of parties, all of which, including her own, said that we should leave the European Union. And to leave the European Union, we need to leave the customs union and the European economic area and restore democratic control and political power, and that is what we will do; that is our duty.
Tom Pursglove (Corby) (Con)
The naysayers who are talking this up are some of the same people who said that on 24 June we would drop off a cliff, exports would be down, foreign direct investment would be down, and jobs would be lost—the list goes on—but the opposite is true. Does my hon. Friend agree that it will not always be plain sailing—there will be difficulties along the way—but the end destination is worth getting to, and people up and down this country in increasing numbers are just saying, “Get on with it”?
Mr Baker
I agree with my hon. Friend that we do need to get on with it, and, yes, the end destination is worth getting to, although, hopefully, there will be no end to this journey. We will journey out into a new life of prosperity and self-government, which will give us the dignity of self-control.
Toby Perkins (Chesterfield) (Lab)
First, let me draw the attention of the House to my entry in the Register of Members’ Financial Interests concerning Weightron Bilanciai.
I have here a letter sent by the European Commission, which was received by British manufacturing firms, telling them that after Brexit all products certified for use by UK certifiers will no longer be eligible for sale in the EU. Those companies are now rushing to get their entire product range recertified, often at three times the cost, from European certifying authorities. What advice do the Government give to UK manufacturing firms that have products certified in the UK about what they should do in the run-up to Brexit and the need for recertification?
Mr Baker
I expect us to conclude a free trade agreement with the European Union that includes agreements in relation to product conformity. I hope that we will make rapid progress through these negotiations now that we have made sufficient progress and are moving on to the next stage. I very much hope that everyone in this country, including manufacturers, to which the hon. Gentleman refers, will be given an accelerated degree of certainty as we progress through the negotiations.
Mike Wood (Dudley South) (Con)
Is my hon. Friend familiar with the PwC analysis that suggests that the UK could be the fastest growing economy in the G7 between Brexit and 2050?
Jo Platt (Leigh) (Lab/Co-op)
The Minister will be aware that I have submitted 23 questions to his Department asking what assessments the Government have undertaken—all to ensure that businesses and workers in my area are safeguarded. The Government have repeatedly refused to release even the titles of these assessments, so will the Minister confirm how many impact studies the Government have conducted and for how long he expects Members to have access to these documents before we vote on the final Brexit deal?
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Mr Speaker, you will recall from this morning that the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Burton (Andrew Griffiths) ducked my question on the impact of these assessments on small businesses, so I will try again. Leaked or not, if the Minister is willing to be disparaging about his own civil servants who are producing his own reports, does he also reject the reports from the University of St Andrews that point out that small business will be hit by lower levels of investment and access to finance, lower growth and reduced product development opportunities?
Mr Baker
I will make two points. First, as far as I recall, I have never been disparaging about civil servants with whom I have worked; it is quite the reverse. What I have been disparaging about is method in the economic sciences. That is quite different. Secondly, all the circumstances in this analysis predict growth. I refer the hon. Gentleman to the answer that I gave earlier, pointing out all the flaws in the predictions of the Bank of England. I ask him to start working out how he can play his part in leading this country forward with a spring in its step.
Matt Western (Warwick and Leamington) (Lab)
I refer the House to my declaration in the Register of Members’ Financial Interests. In the past week, Mark Carney and Jaguar Land Rover have blamed Brexit on the fall in growth and business respectively. For Jaguar Land Rover, this is resulting in prolonged shutdowns and declining production. This is happening now. Will the Minister accept the reality of what is happening and publish the Government’s analysis?
Mr Baker
I accept that Jaguar Land Rover does not sell as many cars as I should like it to. I consider it this Government’s duty to enter into trading arrangements with the whole world that facilitate the company’s complete success. I look forward to working to do just that with all the strength we can muster.
Diana Johnson (Kingston upon Hull North) (Lab)
If work has been done on the regional impact of different Brexit scenarios, is not it in the national interest for regional devolved bodies and local councils to have this information, so that they can make appropriate plans for the future?
Mr Baker
We will continue our programme of engagements with the devolved Administrations and the English regions. What we will not do is publish or reveal information we consider to be prejudicial to their interests and the national interest or that would harm our negotiations.
Alex Cunningham (Stockton North) (Lab)
The information in today’s Government report directly reflects what industries and businesses on Teesside have been saying for months—that they will suffer if the Government totally abandon the single market and the customs union. Ministers may choose to ignore the reports, but will they please listen to what the industrialists and the businesspeople are saying? The Government need to be open and honest about the impacts and provide clarity on how these businesses can trade successfully after Brexit.
Mr Baker
The Secretary of State went to the region only last week to make an important speech about the implementation period, precisely because we understand the importance of industries and businesses there. There is no question of our ignoring analysis. We are conducting the analysis to inform our position, as I have tirelessly set out.
Anna McMorrin (Cardiff North) (Lab)
This is about the UK Government doing their job, and they have spectacularly failed to do that. This leaked paper talks about the impact of Brexit on different areas of the UK, despite the Government telling devolved Governments and Administrations that they have no such information. The Minister failed to answer the question asked by my hon. Friend the Member for Ynys Môn (Albert Owen), so when will this information be shared with the devolved Administrations, so that they can make decisions on behalf of the people they represent and govern?
Mr Baker
We will make information available once we are through the negotiation, so that we do not end up putting ourselves in the position of publishing information that is prejudicial to the national interest. I would expect that information to be published—and, in particular, to be made available to both Houses of Parliament—once the negotiations have concluded and before the meaningful vote.
Mrs Madeleine Moon (Bridgend) (Lab)
Why do this Conservative Government not trust the voters of Bridgend, many of whom rely on the Ford engine plant for their jobs? It is acknowledged that car manufacturing will be one of the hardest-hit areas. The Minister says that there is going to be growth. In that case, let the people of Bridgend know where the growth is going to be and what better growth could be achieved by staying in the single market. Is he more interested in healing the wounds within the Conservative party than looking after the people of Bridgend?
Mr Baker
I am interested in healing the wounds across the whole country, getting people to unite behind a democratic decision and thus taking it forward. It is precisely because we do trust the voters that we want not only to carry through the referendum result, but to ensure our parliamentary independence, so that the voters can materially affect a Government’s policy choices.
Martin Whitfield (East Lothian) (Lab)
I am concerned about some of the recent answers. Will the Minister confirm what damage will happen to the UK’s negotiating position if this analysis is shared with the devolved Governments?
Mr Speaker
I will take this point of order now, as I believe it relates to the subject matter that we have been discussing.
Jo Platt
Further to the question that I have just asked, I have tabled 23 written questions to the Department for Exiting the European Union and the Treasury over the past six weeks, asking for the titles of any assessments that the Government had conducted on the impact of our withdrawal from the European Union. However, none of these questions has been adequately answered. What I have received has been vague; my questions have often been ignored; and Ministers have not provided me with the information I requested. Mr Speaker, without any obvious avenue to take, I seek your guidance on how I can secure an answer from Ministers to the questions I have asked in order for me to ascertain the number of assessments the Government have undertaken and their titles.
Mr Speaker
I thank the hon. Lady for giving me notice of her intended point of order, although I am not at all sure that I can offer her much satisfaction or comfort. The content of ministerial answers to parliamentary questions is the responsibility of the Minister concerned. It is not, and cannot be, a matter for the Chair. I understand her dissatisfaction with the answers that she has received. I am afraid that it is not uncommon for answers from successive Governments of different complexions to fail to engage—either fully or, in some cases, at all—with the question in the view of the recipient of the answer, or, indeed, to do so only vaguely. However, I advise the hon. Lady to persist and to discuss with the Table Office what other avenues she might pursue.
I must emphasise, on the basis of some little experience in the House, the merits of quantity, persistence and, above all, repetition. Members must—if I may very politely say so—keep at it. I remember one year tabling, I think, a little under 4,000 questions, which somewhat irritated Ministers at the time, although that caused me no concern whatever. I was simply concerned to table the questions that mattered to me. If that caused some inconvenience to other people, it was really beside the point. Democracy costs.
On whether Members will be granted access to analytical studies on the impact of the UK’s withdrawal from the EU ahead of any vote on the final deal, I do not know the answer to that question beyond what we have heard from the Minister today, and the Minister has said some things today on which Members can reflect. If the hon. Lady wants to put further questions on this matter to Ministers, it is open to her to do so.
On whether it is in order for Ministers or Departments to show information to journalists before providing it to the House, I would say that although this is not a matter of order, it would certainly represent a discourtesy to Members, and I would deprecate that. I hope that Ministers will reflect on the matter and consider what information should be provided to the House on this important matter at all stages. I hope that that is helpful to the hon. Lady.
Neil Coyle (Bermondsey and Old Southwark) (Lab)
On a point of order, Mr Speaker.
Mr Speaker
Very well, I will take it. The hon. Member for Battersea (Marsha De Cordova) will just have to be patient for a short period.
Neil Coyle
Thank you, Mr Speaker.
The ministerial code of practice outlines seven principles of public life, one of which is on openness. It states specifically:
“Information should not be withheld from the public unless there are clear and lawful reasons for so doing.”
It sounds as though there is certainly a discrepancy between what was said to the Select Committee in December and what we have heard over the past couple of days and some things that the Minister has said today. What course of action is open to a Member who wishes to pursue the matter at stake if the Secretary of State or a Minister has not provided information that should be available to my constituents and businesses who are deeply affected by it?
Mr Speaker
I am very grateful to the hon. Gentleman for his point of order. I will make a number of points briefly in response. First, the ministerial code to which he refers is certainly a very important document, but compliance or non-compliance with it is not adjudicated on by the Chair; that is a matter for others.
Secondly, the hon. Gentleman inquires on what recourse he has if he believes that there is a discrepancy. The short answer is that he can table a question or, indeed, a series of questions on the matter, applying his little grey cells to the formation of such inquiries as he thinks appropriate.
Thirdly, the hon. Gentleman referenced evidence to the Select Committee. He will have heard his right hon. Friend the Member for Leeds Central (Hilary Benn), the Chair of the Brexit Committee, who asked a question on this matter early in the exchanges. The right hon. Gentleman and his colleagues can pursue the matter if they so wish. They have a track record of doing so on previous occasions and might choose to do so on this occasion. I hope that that is helpful to the hon. Gentleman.
PIP Back Payments
(6 years, 10 months ago)
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Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
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Marsha De Cordova (Battersea) (Lab)
(Urgent Question): To ask the Secretary of State for Work and Pensions to make a statement on the process and timetable for the personal independence payment back payments.
The Minister for Disabled People, Health and Work (Sarah Newton)
As a result of our decision not to appeal the recent PIP judicial review judgment, we informed the House via a written statement and in a response to a parliamentary question that we will be carrying out an administrative exercise to identify claimants who may now be eligible for more support from PIP. The Secretary of State took the decision less than three weeks ago. As previously said, we will be working with Mind—experts in the field—and doing things as sympathetically and effectively as possible. While efficiency is important, I cannot stress enough that I want the appropriate scrutiny and complete accuracy to be applied to this exercise, so it will not be rushed.
This exercise will include screening the existing PIP caseload of some 1.6 million people to identify the group who may benefit, but the vast majority of claimants will not be affected. As the Secretary of State said last week, we currently estimate that up to 220,000 people will be affected by the judgment. For the group of people who may be affected, we will undertake a detailed review of their applications and awards. We will write to the individuals affected, and all payments will be back-dated to the effective date in each individual claim. There will be no—I repeat, no—face-to-face reassessments of awards. DWP case managers will be conducting a review of the existing information we hold, with a view to establishing whether claimants are entitled to more. If case managers need more information to make a decision, they will contact the claimant and/or their doctor.
I am sure you will understand, Madam Deputy Speaker, that this is a complex exercise, and we need to undertake testing to ensure that we implement it safely. We therefore do not yet have an estimate of how long it will take. Obviously, we will keep the House updated on our progress in this exercise. Based on preliminary calculations, we estimate that the overall costs of implementing the judgment could be up to £3.7 billion by 2022-23. However, this number is highly likely to change as we work through all the impacted cases.
Marsha De Cordova
I thank Mr Speaker for granting this urgent question.
Following the written statement of 19 January and last week’s urgent question, yesterday we discovered in an answer to a written question that the Government will be reconsidering approximately 1.6 million PIP claims—effectively, everyone currently in receipt of PIP. However, no timetable was issued or detail provided for this process. We know that 55% of people with mental health conditions transferring from disability living allowance to PIP receive a lower award or no award at all. As the High Court found, the Government’s regulations are highly discriminatory.
I am pleased that the Secretary of State and the Minister’s Department have finally seen sense. However, there are a number of questions that the Minister must answer. By what date will the Department have changed the PIP assessment guide, so that she can implement the judgment? How quickly thereafter will the Department be able to identify affected claimants? Is her Department prioritising the PIP claims it is re-examining? If so, will she publish the prioritisation criteria? By what date will all 1.6 million PIP claims have been reviewed? Will it be weeks; will it be months; or will it be years? Do the 1.6 million claims to be reviewed include those that scored zero points and were not awarded PIP? Will there be an appeals process for the PIP claimants not contacted by the Department who believe that they should receive back payments? Will the Department compensate claimants who have fallen into debt and accrued interest charges? After the equality assessment was published in February 2017, the estimated number to receive the higher rate of PIP went up to 164,000, and it is now 220,000. Will the Minister publish an updated assessment? What assessment has she made of the administrative costs to her Department of undertaking this complex exercise of a considerable scale?
This mess is one of the Government’s own making. It is a clear example to this Government of the dangers of seeking to undermine both the independent judiciary and the House of Commons.
Sarah Newton
It is absolutely not true to say that we are trying to undermine the independent judiciary, because we have accepted the findings of the appeal and are now going to painstakingly, carefully and safely implement the findings. It is incredibly important for our democracy that we have an independent judiciary, and we stand by that.
The hon. Lady asked a number of questions. First, for clarification, the information that was provided in response to the written parliamentary question was absolutely the same as that given at this Dispatch Box by the Secretary of State last week and that contained in the written statement.
Moving on to some of the hon. Lady’s more detailed questions, she mentioned the updating of the PIP assessment guide. She is absolutely right: that is the starting point to making sure that we properly and thoroughly implement the recommendations of the appeal. I am delighted to say that Paul Farmer of Mind has agreed to work very closely with us to get that right. I have spoken to Paul Gray, who has undertaken the independent reviews of PIP, and he has also offered his help. I recently met a broad range of our PIP stakeholders and invited them to share their expertise.
As I said in my previous response, it is incredibly important to me that we get this right. The exercise will be complex and, to carry it out accurately and safely, we want to ensure that stakeholders and experts are involved. As a result, I cannot set out a timetable at this stage, but I can reassure all hon. Members that we are approaching this with a great deal of vigour and will ensure we do it as soon as possible. We have already started to recruit more people at DWP to help with the PIP review.
We want to discuss the prioritisation of the review of PIP claimants very carefully with our stakeholders to ensure that the process is fair, transparent and open. We will be reviewing people who had zero points in their original claim. We are currently considering the best way to handle an appeals process.
Of course, I will update the House regularly. The Secretary of State said that she would do that from this very Dispatch Box last week. We have oral questions every six weeks, so there are plenty of opportunities for Members to ask us about the progress we are making in this very important work.
Sir Desmond Swayne (New Forest West) (Con)
What impact, if any, will this effort have on the processing of new claims?
Sarah Newton
I thank my right hon. Friend for that important question. I want to reassure him that it is very important to me that the progress we have seen in making timely and good decisions on PIP continues. Our customers—our claimants—are very important to us in the DWP, and we want them to have a really good experience. I am determined to ensure that the progress we have made continues and that there are no delays for people applying for PIP.
Deidre Brock (Edinburgh North and Leith) (SNP)
I find it shameful and depressing that it took a court case to drag this Government back to the edge of decency, and I find the money wasted on legal proceedings abhorrent. However, since they are now at the edge of decency, may I urge the Government to take a few more steps? Will the Secretary of State apologise to the victims of the Government’s actions? I appreciate that she is new in her post, but this is important. Will she also apologise to the families of those who have taken their own lives as a result of the Government’s benefits policy? Will she confirm that she is now undertaking to restore some semblance of dignity to this policy area by reviewing all PIP cases where benefits have been stopped or reduced, rather than just those involving mental health? Will she undertake to come back to the Chamber in the very near future with a plan to start repairing some of the damage that has been done? One month should be sufficient time to get that rolling.
Sarah Newton
It is with deep regret that I hear the hon. Lady making such appalling and unsubstantiated claims about people committing suicide as a result of this. All of us in this House have a duty to be very mindful of the language and evidence we use to make such assertions. We are talking about some of the most vulnerable people in society, and it is shameful when Members deliberately misuse data.
I am pleased to have this opportunity—[Interruption.] Listen, the data to which the hon. Lady is referring is often misquoted, and it comes from the adult psychiatric morbidity survey. The deputy chief medical officer, Professor Gina Radford, has said that the adult psychiatric morbidity survey does not show any causal link between being on benefits and suicidal thoughts or behaviour. The survey findings indicate certain associations, but they do not indicate causality. The hon. Lady might not want to take my word for it, but is she seriously doubting the word of the deputy chief medical officer?
Heidi Allen (South Cambridgeshire) (Con)
I am very pleased that the Secretary of State has decided to accept this ruling from the Court and that the Minister has today confirmed that there will be no face-to-face reassessments—that is absolutely right. I am also greatly encouraged that the Minister will be working with Mind, Paul Gray and other knowledgeable people to rectify the situation. Might she continue to work with them on an ongoing basis to see what other improvements can be made to PIP? The Work and Pensions Committee, of which I am a member, is about to publish its recommendations. I believe that a fundamental overhaul of the PIP process is required, but a number of very small things could be done, such as introducing videoed assessments, that would make a huge difference to how claimants feel about the process.
Sarah Newton
I thank my hon. Friend for her question and for the invaluable work that she and other members of the Work and Pensions Committee do. I look forward to receiving the Committee’s recommendations and will give them careful consideration.
I want to reassure my hon. Friend and other hon. Members that I believe in continuous improvement. I am very grateful for the constructive working relationship that I have with many disability rights organisations and charities that support disabled people, and for the time they give to my PIP stakeholder group. We are about to set up panels of claimants of both employment and support allowance and PIP so that we further engage with claimants themselves. Of course, we undertake proper independent customer satisfaction surveys to ensure that we take every opportunity to improve the claimant experience.
Stephen Timms (East Ham) (Lab)
The Minister has told the House that all 1.6 million existing claimants will have their cases reviewed. I am grateful to her for adding that those who had zero points, and therefore did not get PIP, will also be included in the review. Will she confirm that the 180,000 people who used to be on disability living allowance and are no longer receiving benefit will be included? In total, on top of the 1.6 million, how many cases does she expect to review?
Sarah Newton
As all Members will know, people have been going through a managed process of transferring from disability living allowance to PIP. We will be looking at people who have gone through the PIP assessment process. Just over half of people on disability living allowance have gone through the managed process to PIP. There are still people on DLA who are yet to go through the process, but we are taking on board all the findings of the appeal and improving the process to ensure that we make the right decision the first time. That is really important to us and to claimants.
Justin Tomlinson (North Swindon) (Con)
This is a significant and important announcement. Will the Minister give a clear commitment on continuing to work with stakeholders and charities not only to learn the lessons, but to help them to communicate with all their members so that they can be kept up to date with that work?
Sarah Newton
When my hon. Friend held my position, he did a really good job of engaging with stakeholders, and I am building on that legacy. It is very important that we take on board their concerns and communicate with them frequently so that they can provide reassurance and information to their beneficiaries.
Mr Pat McFadden (Wolverhampton South East) (Lab)
The system is in fundamental need of review. My constituent Martin Wright suffered a terrible life-changing accident at work several years ago. Despite that, he has been reassessed three times in three years and has now had his payments reduced. We will take Martin’s case to appeal, and I have to tell the Minister that every single case from my constituency office that we have taken to appeal in the past year has been overturned. Does that not show that this system is broken, inhumane at times, and in urgent need of fundamental change?
Sarah Newton
Of course I do not like to hear of individual cases when things have not worked out as we would like them to. If the right hon. Gentleman would like to meet me to discuss his constituent’s case, I would be very happy to do so. I hold meetings twice a month so that Members or their caseworkers can come along and meet my officials to review such cases.
It is worth setting all we are doing in context. We have made 2.9 million—I repeat, 2.9 million—PIP assessments, and 8% of those go to appeal, of which 4% are upheld, so the vast majority of people are getting the benefits to which they are richly entitled. If we look at the claimant work we do—the customer satisfaction surveys—we find that most people are satisfied with the process. Of course, until we have no appeals and 100% satisfaction rates, we will constantly be seeking to improve the situation, but the facts do speak for themselves.
Mr Philip Hollobone (Kettering) (Con)
May I congratulate my hon. Friend on her response to the urgent question and ask her whether she will be kind enough to check my understanding of the figures? I think she said that there are 1.6 million PIP claimants and that she expected just over 200,000 to have their assessments changed—improved. It therefore seems to me that the 1.4 million people who will not see a change in their benefit will have had their expectations raised by this announcement. How will the Minister manage those expectations?
Sarah Newton
The Secretary of State has made it clear at the Dispatch Box that the figure is about 220,000 people. Some of the things that some Members of this place have said in the media are very disappointing, having both scared people and raised false hope.
Diana Johnson (Kingston upon Hull North) (Lab)
May I make one suggestion to the Minister about how she could do the decent and humane thing? She should passport all those affected by the contaminated blood scandal—having contracted HIV and hepatitis C—who were previously in receipt of DLA through to PIP at the higher rate. It should be a blanket passport.
Sarah Newton
I thank the hon. Lady for her question. It is really important that we remember what PIP is. It is a very modern, dynamic benefit, and it treats with parity of esteem physical and mental health and disabilities. No two people are the same and no two people’s needs are the same, so it is a person-centred benefit. It is really important that we remember that.
Helen Whately (Faversham and Mid Kent) (Con)
I welcome the Government’s decision to accept the Court’s judgment and the Minister’s careful work to improve PIP assessments, including by looking at the recording of assessments, which she and I have talked about. Irrespective of whether someone’s health condition is mental or physical, does my hon. Friend agree that what matters is that they get the help that they need to meet the extra costs of living and to live the fullest possible lives?
Sarah Newton
I thank my hon. Friend for her contribution. She is absolutely right to focus on parity of esteem—the Government have legislated for that—between people with mental and physical health conditions. That is really important.
Let us just look at the facts about how many people with mental health conditions are being positively supported by PIP. The latest figures from 27 October show that 66% of PIP recipients with mental health conditions get the enhanced daily living component compared with only 22% who receive DLA, the predecessor benefit. Some 31% of PIP recipients with mental health conditions get the enhanced mobility rate compared with just 10% of DLA recipients. It is absolutely the case that hundreds of thousands more people are being helped with PIP than with DLA. It is of course important, however, to do all we can continually to improve the process.
Mr Kevan Jones (North Durham) (Lab)
The mental health charity Mind found in its survey last year that 22% of the people it surveyed did not actually appeal against a PIP refusal because of their condition—they did not feel able to do so. I assume from what the Minister is saying that those people will be part of the reassessment, but what advice should Members of Parliament give those individuals now, because some will want to put in new applications? What support will they be given, because some of them have been left in a very difficult position, through no fault of their own, due to their mental illness?
Sarah Newton
We will be working with Mind—I agree that it is an excellent charity—and other organisations, and they will help us to shape this process so that it is conducted in a sympathetic and appropriate way to make sure that we reach all people who are entitled to PIP.
Alex Burghart (Brentwood and Ongar) (Con)
I thank the Minister for her statement and for the way in which the Department is going about this reassessment. Will she assure the House that, as the Department undertakes this major operation, it will still be able to deliver assessments for people moving on to PIP for the first time and that this will not affect their claims in any way?
Sarah Newton
My hon. Friend asks a really good question because, as I have demonstrated with the numbers I have shared with the House, more people are benefiting from PIP than from DLA, its predecessor benefit. I do not want people to miss out on the opportunity that PIP affords them. We are absolutely determined to make sure that there will be no reduction in the quality of service that we provide for new applicants or, indeed, people transferring from DLA to PIP.
Chris Stephens (Glasgow South West) (SNP)
Given that the Court’s ruling has taken effect, what interim guidance has the Department provided to assessors pending revisions to the assessment guide?
Sarah Newton
We are working through every aspect of undertaking this complex and challenging task. At the heart of everything we will be doing is working very closely with Mind and our other key stakeholders to get this right. The process must be done accurately and it must be done safely.
Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
May I congratulate the Minister on the tone in which she has conducted these proceedings? It has been absolutely spot-on, and it really does refute some of the more accusatory comments from Opposition Members. Will she set out by how much spending on the main disability benefits has risen since 2010?
Sarah Newton
I very much appreciate my hon. Friend’s question. We have a proud track record as Conservatives. In every year since 2010, the amount that we provide to people with health conditions and disabilities has risen, and it will continue to do so in every year of this Parliament. The figure is well in excess of £50 billion each year.
Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
I receive many emails every week, as I am sure we all do, from constituents who are distraught about their PIP application being rejected. The whole process has been cruel beyond belief, and we now know it has all been for naught. Will the Minister reassure my constituents who have faced shocking suffering that they will be considered as part of this review, and what advice should I give them to ensure that that happens?
Sarah Newton
I simply rebut what the hon. Lady says about anybody in the DWP treating people cruelly. I assure her that we want to make sure that people claiming our benefits are treated with respect and dignity, and that the process is fair. Independent evaluations show that the majority of claimants rate their experience as good.
To answer the hon. Lady’s question about the advice that she could give her constituents, they will be contacted by DWP if we feel that they are entitled to more money. Nobody is going to be called in for a face-to-face assessment, and nobody is going to have money taken away from them.
Rachel Maclean (Redditch) (Con)
We have all met constituents in our surgeries who have concerns about PIP, so I really welcome today’s announcement, which will help people in my constituency. Will the Minister confirm what more her Department will continue to do, in the light of this announcement, to move forward the transformative benefits of getting disabled people back into work, which is one of the greatest levers for improving mental health for disabled people?
Sarah Newton
I thank my hon. Friend for her insight, because she is absolutely right that good work is good for people. A core part of our Work and Health programme is that we do everything we can to test and learn so that we enable more people to play their full part in society, including at work.
Ian Paisley (North Antrim) (DUP)
Portglenone medical centre in my constituency is one of the largest rural practices in Northern Ireland. It deals not only with vulnerable people, but with some of the most marginalised in the country, because of their rurality. The practice has written to me to say not only that the system is deeply “flawed”, but that it is already
“seeing multiple patients having to appeal inappropriate decisions”.
I know that the Minister will not want to hear those words, which distress us all. Given that there is no Executive in Northern Ireland, will the Minister meet me and all party colleagues represented in the House to discuss how Northern Ireland can benefit from the decisions that she takes as a result of today’s announcement?
Sarah Newton
Of course I would delighted to meet the hon. Gentleman and his colleagues. I hold regular sessions in Parliament—teach-ins on PIP and ESA, which any Member of Parliament and their caseworkers may attend, bringing their casework along, so that we can have a really good dialogue. However, if the hon. Gentleman would like to have a specific meeting about the situation in Northern Ireland and what we can do to support him in doing his very important job of representing his constituents, I would be delighted to do so.
Nigel Mills (Amber Valley) (Con)
Would it be helpful to create a specific phone number that affected claimants or their advisers could contact to suggest that they think they ought to have a change of decision, rather than requiring them to wait while the Department searches through 1.6 million records to try and find them?
Sarah Newton
I thank my hon. Friend for his question but, no, I think that by far the best thing is to say that we will contact the people affected. I am concerned that if people started doing such a thing, it would be a distraction and could use up the resources that I want to put into ensuring that we get this sorted as soon as possible.
Ms Marie Rimmer (St Helens South and Whiston) (Lab)
When the Government announced the changes to the regulations in 2017, their own assessment was that approximately 164,000 claimants would be directly affected. Will the Minister commit to recommending that priority is given to those people who were directly affected and lost money, and to addressing the problems with some urgency?
Sarah Newton
I am having a conversation about prioritisation with Mind and stakeholders. It is really important that we work with experts and stakeholders to help us to decide the prioritisation. I can absolutely assure the hon. Lady and everyone in the House that this is of the utmost importance and that we are acting at pace to get it sorted as soon as possible.
Michelle Donelan (Chippenham) (Con)
Supporting the vulnerable and people with disabilities and health conditions should always be the Government’s top priority. Will the Minister confirm that personal independence payments are not subject to the benefits cap or means-testing, and that payments will continue to rise with inflation and to be untaxed?
Sarah Newton
My hon. Friend makes a very important point. Keeping people safe and taking care of the most vulnerable people in society are the top priorities for this Government, and I know that my hon. Friend does a huge amount of work in her constituency to support the most vulnerable members of her community. I can absolutely provide that assurance—PIP is a non means-tested benefit that is not subject to the benefits cap. It plays a vital role in enabling disabled people to play as full a part in society as they can, which is something I know that my hon. Friend and I both want.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
It is nothing short of a national disgrace that Ministers persisted with this utterly flawed and unfair system of PIP assessments despite all the warnings. It was only when the High Court ruled that Ministers’ changes to PIP were “blatantly discriminatory” against people with mental health conditions and were a breach of their human rights—the opposite of parity of esteem in action—that the Government announced that they would review the 1.6 million cases. Can the Minister assure the House that PIP assessments will take into account the full range of symptoms and factors affecting mental health, especially those symptoms that we cannot see that present differently on different days, including due to bipolar disorder, depression and phobias?
Sarah Newton
I can absolutely assure the hon. Lady that we are utterly committed to making sure that mental health and how it affects people are properly and fairly treated throughout the PIP assessment process, but I do think we should look at the number of people who are now receiving help, and the number of people with mental health problems who are now receiving financial support through PIP who were not under DLA. Some 200,000 people now receive the highest level of support, and more than 100,000 people receive the highest level of mobility support. Clearly PIP is not broken, because it is supporting many more people than DLA did.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
My hon. Friend set out the potential costs of the review. Will she put that in the context of her Department’s overall spending to support people with disabilities and health conditions? Will she reaffirm that spending in this area increased in the last Parliament and will continue to go up during this Parliament?
Sarah Newton
Every single year, the funding that we put into supporting people with health conditions and disability has grown, and that sum will continue to grow. At the moment the budget is about £51 billion, and we estimate—it will only be an estimate until we have undertaken careful review, and it is probably a worst-case scenario—that this process will cost £3.7 billion. My hon. Friend is probably much better at calculating percentages than I am.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
By no means an isolated case in my constituency, one of my constituents in Drumnadrochit, despite being clinically assessed with mental health issues, was marked as a fail for a mandatory assessment. That has exacerbated the conditions that she suffers from, and also the pain that she has to endure daily. How will the Minister ensure that my constituent gets the urgent help and review that she needs and deserves?
Sarah Newton
I thank the hon. Gentleman for raising that constituency case and I would be delighted to meet him to review it.
I would sound a word of caution. I have met many people who would be described as having severe mental health problems, who play a really full part in their community and also work. We have put a lot of money into supporting innovative programmes that enable people with mental health problems to manage those conditions, so that they can stay in work. I have met people who have told me that the work we are doing has literally saved their lives. I have met consultants who have told me that they would never have believed that people with such severe mental health conditions could be so well supported to play their full part in society, including work. Each person is unique and each person’s needs must be assessed individually.
Mr Clive Betts (Sheffield South East) (Lab)
As part of this review, will the Government be looking at people who currently have one component of PIP, to see whether they might be entitled to both components, and will they be looking at people on the lower rate of PIP, to see whether they might be entitled to the higher rate?
Sarah Newton
As I say, we will be ensuring that we fully implement the findings of the appeal, and we will be doing that by working very carefully with our stakeholders to make sure that we get this right. We will be reviewing all 1.6 million PIP claimants.
Stephen Lloyd (Eastbourne) (LD)
l thank the Labour party for securing an urgent question on this important issue. We know that the Government’s attempt to prevent those with mental health issues receiving the higher mobility rate was, frankly, nothing but a shoddy attempt to save money. That was a disgrace. They then dragged it out through the courts for many, many months and I think that was absolutely disgraceful behaviour. I know that the Minister for Disabled People, Health and Work is new in her post, but is she proud of what her Government did over this particular PIP episode?
Sarah Newton
It is disappointing that the hon. Gentleman is not prepared to recognise the contribution of Lord Freud, a fellow Liberal Democrat, who held the ministerial position that developed PIP when he was in the coalition Government; and it is disappointing that he is not celebrating the shared achievement of PIP and how it is enabling many more people to be supported. I do think it is really important that the hon. Gentleman listens carefully to what I have said—that we are going ahead with vigour to implement the full findings of this review.
Tracy Brabin (Batley and Spen) (Lab/Co-op)
The Minister has been celebrating the Government’s desire to ensure that all PIP claimants live as full a life as possible. Can she confirm that cases, like those in my constituency, where people have had their vehicles taken from them will be reviewed as part of this process, and that mobility vehicles will be returned where appropriate?
Sarah Newton
I thank the hon. Lady for that question, and suggest that she comes to talk to me with those constituency cases so that we can fully understand. As people are migrating across benefits, such as when people are on ESA, we have a really well worked out programme with Motability so that people do not have to lose their cars. Of course, the devil is always in the detail, and without the details of her constituency case I cannot properly respond. I invite her to come and discuss it with me.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
I refer the House to my entry in the Register of Members’ Financial Interests. I am a psychologist, and when I look at the PIP criteria it appears to me that they do not seem to lend themselves to a full assessment of mental health issues. It is also a concern that collateral medical information is not routinely sought from applicants. Will the Minister come to the all-party parliamentary group on disability, which I chair, to consider these issues pragmatically and to look at how people are trying to navigate the system, to ensure that the most vulnerable do not fall through the gaps?
Sarah Newton
I can assure the hon. Lady that PIP was co-designed with experts in the field. Where appropriate, medical information is of course used, but it is important to remember that the PIP assessment is a functional assessment; it is about the impact of someone’s mental or physical health on them as an individual, and no two people are the same. Of course, medical information is important, but the impact of listening to the individual, their carers and the people who support them is just as important. As for her kind invitation to the APPG, I would be delighted to come along and meet her.
Danielle Rowley (Midlothian) (Lab)
I welcome the fact that the Department will be working with Mind and that mental health has been mentioned so often today, but I have not heard enough about real, solid and tangible change that will support people with mental health conditions. Will the Minister commit to looking again at the assessment process to ensure that people with mental health conditions are assessed by a mental health clinician in the first instance?
Sarah Newton
The Government are deeply committed to supporting people with mental health issues. By 2020, we will be spending more than £1 billion a year, which includes a wide range of investment in services and in recruiting and training more people. I assure the hon. Lady that the people carrying out the PIP assessments, just like the people carrying out the work capability assessments, receive thorough training. We are always working with stakeholders to see what more we can do to improve the claimant and our customers’ experience.
Lady Hermon (North Down) (Ind)
I recognise that the Minister has great compassion in her role, and the manner in which she has spoken today confirms that, but I was very disappointed by her response when Motability vehicles were mentioned. The Minister must take a much more robust direction in this regard. I have constituents who have definitely been refused PIP on account of their mental health condition and have therefore had a letter sent to them notifying them that the Motability car must be returned by a deadline. My constituents cannot comprehend what is going on. So, we would like a much more robust approach to Motability cars and a stay on their removal until PIP assessments have been properly completed.
Sarah Newton
I thank the hon. Lady for her kind words and her question. I would be delighted to meet her to consider that specific case to see what more I can do to work with Motability to ensure that people who need their cars get to keep them.
Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)
A constituent of mine, a 63-year-old man, was deemed by his doctor to be unfit for work, having suffered from coronary artery disease, and was placed on the higher rate of PIP. He subsequently received a review form, which he duly completed within the timescales and resubmitted. He was then informed by the DWP that the form had not been received, and that as a result he would forfeit his benefits and be liable to pay back everything he had received up until that date. That clearly caused him unacceptable mental anguish, on top of his bad physical condition. It was only after the intervention of my caseworker that that review form was identified, found and his payments were reinstated. What will the Government do to deal with the clear anguish that that has caused my constituent as part of a wider symptomatic issue? Will they reinstate a compensation scheme to ensure that these people are adequately compensated, particularly when they have fallen into severe debt?
Sarah Newton
The hon. Gentleman exemplifies the important role of a Member of Parliament in supporting constituents through their casework. He might like to meet me about that case. It is by reviewing individual cases that we find out how we can make improvements. I reassure all Members that if a decision is overturned and the Department has made a mistake, we back pay people to the date from which they are eligible for the benefit.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
We all want—at least I hope we all want—to make sure that all those in need get what they need to live, not just to exist. To that end, will the Minister confirm that the £3.7 billion that this is expected to cost will be an additional allocation from the Treasury and will not be found from existing DWP budgets?
Sarah Newton
The figure of £3.7 billion is an estimate of what this will cost. As we work through sorting out the problem, we will have a much better idea of the numbers, but I can absolutely assure the hon. Gentleman that we will not make savings in our Department to fund it.
Points of Order
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Anna Turley (Redcar) (Lab/Co-op)
On a point of order, Madam Deputy Speaker. Following two similar points of order made last week by my hon. Friends the Members for Ilford South (Mike Gapes) and for Stoke-on-Trent Central (Gareth Snell), I am sorry to have to make this point of order but I am beginning to fear that this pattern of failure is not an accident.
Last Friday, the following Members of Parliament came to my constituency: the hon. Member for Middlesbrough South and East Cleveland (Mr Clarke), the Under-Secretary of State for Exiting the European Union, the hon. Member for Fareham (Suella Fernandes), and the Secretary of State for Exiting the European Union, the right hon. Member for Haltemprice and Howden (Mr Davis). I was notified only of the visit of the Secretary of State, and that was after 8 pm the previous night. I received no notification from the other two hon. Members. What is more, I was not invited to a departmental, non-political event at Teesport in my constituency, whereas the hon. Member for Middlesbrough South and East Cleveland, who has neither a port nor the River Tees in his constituency, was. I can only presume that it was because he is a Conservative MP. The same situation arose last year with a visit from the Prime Minister and the Minister responsible for the northern powerhouse.
Can you advise me, Madam Deputy Speaker, as to whether this is an appropriate politicisation of a departmental visit and a breach of parliamentary protocol, and may I also seek your clarification on the fact that having a directly elected Mayor in a region does not mean that Ministers can circumvent Members of Parliament when visiting or engaging with constituents in an area? It is deeply disrespectful to the people I represent, who should have their voices heard at events in their backyard. It is also disrespectful to this place to seek to cut out parliamentarians to boost the profile of elected mayors of the same party as those other Members.
Madam Deputy Speaker (Dame Rosie Winterton)
I thank the hon. Lady for giving me notice of her point of order and understand that she has notified the Members concerned of her intention to raise it. There is certainly a strong convention that Ministers should give advance notice to hon. Members if they plan to visit their constituency on official business. Indeed, this requirement is spelled out in the ministerial code. I understand that notice was given by the Secretary of State, as she said, but rather late in the day, and she does not think that that was reasonable. She also indicates that notice was not given that another Minister would be attending, which was perhaps an oversight on the part of the Department.
I can confirm that the convention to give notice applies equally to Back-Bench Members. All Members should give advance notice to other hon. Members if they plan to visit their constituency on official business. It is, quite frankly, in everybody’s interest that this convention is upheld.
The hon. Lady asks me whether the fact that a Government Back Bencher was apparently invited to the event when she was not represents an inappropriate politicisation of a departmental visit and a breach of parliamentary protocol. It is not a matter of parliamentary protocol, but a matter for Government. However it strikes me as unsatisfactory, and rather curious, not to invite all local Members to an event that is intended to be non-political, as the hon. Lady indicates this one was.
The hon. Lady also asked me to clarify that the existence of a directly elected Mayor does not mean that Ministers can circumvent local Members of Parliament when visiting constituencies. I can certainly confirm that the existence of an elected Mayor has no bearing on the matter and the usual exemptions apply. I am sure that the point of order has been heard on the Treasury Bench, and I hope that it will be conveyed to the Secretary of State and the Minister.
Christian Matheson (City of Chester) (Lab)
Further to that point of order, Madam Deputy Speaker. I was not aware that my hon. Friend the Member for Redcar (Anna Turley) would raise that point of order, so I had not mentioned to the right hon. Member, to whom I will not refer by name, that I would respond to it. However, I found out last night that a Member of the Cabinet visited my constituency this week and certainly did not inform me or my office of that visit.
My hon. Friend makes an interesting point, which I might ask you to address again, Madam Deputy Speaker. What she described is apparently becoming something of a habit—a commonplace occurrence. Can you advise whether there are mechanisms, through the Chair or other procedures of the House, whereby we might monitor where these affronteries are taking place, so that we can quantify them and see whether a pattern is indeed emerging that needs to be quashed?
Madam Deputy Speaker
The hon. Gentleman will have heard what I said about the fact that it is in everybody’s interest that the existing conventions are upheld, and I reiterate that. On being notified of other possible breaches of the convention, it is up to individual Departments to make sure that they follow the conventions. If individual Members wish to draw to the attention of either the Speaker or Government Ministers that they are not sticking to the convention, it is absolutely up to Members to do that.
Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
Further to that point of order, Madam Deputy Speaker. Can you confirm whether the same convention applies to members of the shadow Front-Bench team? I have had experiences that relate to this in exactly the same way, when I have not received due notification.
Madam Deputy Speaker
The convention applies to all Members. It is important that shadow Ministers inform Members when visiting their constituents, so the answer is yes.
Mr Bob Seely (Isle of Wight) (Con)
Further to that point of order, Madam Deputy Speaker. I think I saw the hon. Member for Portsmouth South (Stephen Morgan) down on my Island during Cowes Week last year, sitting in a VIP tent, so I presume that he was there in part because of his role as a Member of Parliament. He is a member of the Labour party, so it would be good if all sides respected the rules. Because we are terribly laid-back and chilled on the Island, I did not mention it, but I suppose that I could have made a drama out of it if I had wished.
Madam Deputy Speaker
We have to be sensible about this. Obviously, people will pay private visits to other people’s constituencies. That is quite different from official visits or visits by Ministers.
Kew Gardens (Leases)
Tuesday 30th January 2018
(6 years, 10 months ago)
Commons ChamberRead Full debate Kew Gardens (Leases) (No. 2) Bill 2017-19 View all Kew Gardens (Leases) (No. 2) Bill 2017-19 Debates Read Hansard Text
A Ten Minute Rule Bill is a First Reading of a Private Members Bill, but with the sponsor permitted to make a ten minute speech outlining the reasons for the proposed legislation.
There is little chance of the Bill proceeding further unless there is unanimous consent for the Bill or the Government elects to support the Bill directly.
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Zac Goldsmith (Richmond Park) (Con)
I beg to move,
That leave be given to bring in a Bill to provide that the Secretary of State’s powers in relation to the management of the Royal Botanic Gardens, Kew, include the power to grant a lease in respect of land for a period of up to 150 years.
Kew Gardens is a priceless asset, not only to those of us who are lucky to live in west London or even to the UK, but to the whole world. I feel immensely fortunate that my constituency covers Kew, but my interest in, and support for, the gardens goes well beyond my role as the local MP.
Many Members will know the beauty of Kew. It is a UNESCO world heritage site that attracts nearly 2 million visitors every year, including 100,000 schoolchildren, and is an oasis of calm and beauty in our frantic and busy city. I am also honoured to represent the great Sir David Attenborough as one of my constituents—I might even say, my children excluded, that he is my favourite constituent—and he described Kew as
“the premier botanical gardens in the world”.
Tourists flock from all over the world to see it.
Kew has the world’s largest collection of living plants, but it also has one of the world’s largest botanical library collections. Last November, I was taken round Kew’s herbarium, where more than 7 million plant specimens are kept, including 350,000 type specimens—the original specimens on which new species descriptions are based. The plan is to digitise that entire collection and make it available to anyone in the world who wishes to access it.
Kew’s real value derives from much more than being an attraction, or even a stunning garden: it has been a pioneer in plant science and research for well over 250 years. Kew is at the cutting edge of research to identify, for example, ways in which plants can help to combat cancer, diabetes, antimicrobial resistance and much more besides. It is worth pointing out that a quarter of all prescription drugs come directly from plants.
Kew is also leading the way on climate change adaptation of crops. Fifty per cent. of the calories consumed by our species come from just three big grasses—wheat, maize and rice—so the in-built vulnerability of the global food system is self-evident. The work being done at Kew to breed resilience into essential commodities is critically important. Kew truly is a national treasure.
Hon. Members may wonder why the management and finances of Kew Gardens are a matter for this House. Kew is Crown land and as such, is governed by the Crown Lands Act 1702. It is managed by the Secretary of State and a board of trustees, and it is partially funded by the Government through the Department for Environment, Food and Rural Affairs. Four years ago, I led a debate in Westminster Hall along with the now shadow Chancellor, the right hon. Member for Hayes and Harlington (John McDonnell), when it became clear that the Government’s proposed cuts to Kew’s funding were threatening its core scientific work. I was absolutely delighted that we won that argument. The right hon. Gentleman is not here now, but I pay tribute to and thank him for his help in delivering that change.
Since then, Kew has gone from strength to strength. The Bill that I am proposing would help to build on that success and ensure Kew’s future for many more years to come. This straightforward and simple Bill would have a very big impact on Kew Gardens. It is backed by Kew Gardens and its trustees, and the Bill’s previous incarnation—it was brought to the House during the last Parliament by my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger)—was also backed by Members from across the House. It is also supported by the three councillors who represent Kew ward.
Simply, this is what the Bill would do. The 1702 Act prevents the sale of Crown land and limits the length of leases granted from Crown land to a maximum of 31 years. The Bill would simply allow the Secretary of State to grant leases of up to 150 years, in line with Crown Estate land. In practice, 31-year restrictions on leases are stifling, and Kew Gardens has struggled to find commercial interest. A 31-year limit is clearly not attractive to those who would seek to lease the buildings, but a 150-year lease clearly would be.
I stress that the Bill—this change—-would not involve selling assets, nor would it be about renting out Kew Gardens. The sale of Crown land is forbidden already by law, and any leasing of land would be on non-core land and property, and not on the gardens. The Secretary of State, who has the power to grant a lease, can do so only with the consent of Kew’s trustees, who are duty-bound not to approve anything that would affect the gardens’ core purpose. The Bill would do absolutely nothing to undermine that. Kew’s UNESCO world heritage status adds further protection.
It is difficult to give a precise figure for the financial benefits that accrue from 150-year leases, but Kew Gardens estimates that the revenue generated could amount to around £40 million, with the majority coming in the first decade. There would also be the added benefit of lower maintenance costs by transferring the liability for land and property that had been leased. That extra income would be significant and transformative for Kew Gardens. As Members will know from visiting it, much of the Kew estate is in need of improvement and conservation.
The phenomenal scientific research I have described can be continued only if there is sufficient funding. This simple Bill would help Kew become more financially self-sufficient. It is backed by Kew Gardens, Kew’s councillors and numerous London MPs—many more than I could pack into the Bill. I am sorry I could not include the hon. Member for Ealing Central and Acton (Dr Huq) in the list I will be reeling off shortly, but she has expressed her support as well, along with other MPs. The Bill is entirely uncontroversial, and I hope it will receive the House’s support today.
Question put and agreed to.
Ordered,
That Zac Goldsmith, Mr Ian Liddell-Grainger, Richard Benyon, Ruth Cadbury, Theresa Villiers, Dr Matthew Offord, Robert Neill, Bob Blackman, Paul Scully, Mr Iain Duncan Smith, Chris Philp and Andy Slaughter present the Bill.
Zac Goldsmith accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 2 February, and to be printed (Bill 158).
High Speed Rail (West Midlands - Crewe) Bill
Tuesday 30th January 2018
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
18:59 - The House divided: - Ayes: 295 / Noes: 12 - Question accordingly agreed to.
Madam Deputy Speaker (Dame Rosie Winterton)
I inform the House that the amendment has been selected.
The Secretary of State for Transport (Chris Grayling)
I beg to move, That the Bill be now read a Second time.
It is four years since my predecessor, my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin), stood at this Dispatch Box to seek powers for a new railway line between London and the north, the first new major railway line north of London for 120 years. At that time, it was simply a concept—an important one but one that seemed a long way off. We have come a long way since. In February 2017, Parliament granted powers to construct phase 1 of the scheme, from London to the west midlands, and works on part of this route have now begun. This project is now a developing reality. We came a step closer to an operating railway when we announced the shortlist of companies that will bid for the west coast partnership and design, launch and operate the early passenger services on HS2.
This vital new rail capacity project, under construction from London to Birmingham, is only the first part of the project. We need to deliver capacity to our northern cities and bring our country closer together. I am pleased to stand here today, therefore, to start the next phase of this vital project. Phase 2a extends HS2 from the west midlands to Crewe. The first stage of the new line, which will take the midlands engine through to the northern powerhouse, connecting the two together, will accelerate construction of the first section of phase 2 by six years and bring us a step closer to delivering a complete brand-new high-speed line all the way to Manchester. That is the importance of today’s debate. It is this link that will take the railway line towards Manchester—finally to one of our great cities and industrial centres of the north-west.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
As the Secretary of State will be aware, the statement of funding policy that accompanied the last comprehensive spending review awarded to Wales a 0% Barnett consequential rating for HS2, whereas Scotland and Northern Ireland both had 100%. Unless he can assure the House that Wales will get a 100% rating in the next CSR, my colleagues and I will have no option but to vote against the Bill this evening.
Chris Grayling
If the House does not support the Bill, the Crewe hub and the links to north Wales that it will provide will be simply an illusion, so the hon. Gentleman and his colleagues would be doing down Wales, which would be surprising—though, of course, it is typically Conservative Members who are the real champions of Wales. We will continue to ensure we provide the right connections to Wales.
Dame Cheryl Gillan (Chesham and Amersham) (Con)
I thank the Secretary of State for giving way so early in his speech, and I ask him to forgive me as I may not be able to be here for its entirety because I have other duties outside the Chamber, but I hope to return. He says he is very proud of this new railway the Government are building, but can he explain why he is building a railway with old technology? Back in 2015, the Japanese beat all their records with a Maglev train, whereas we appear to be building something from the last century, not something for the future.
Chris Grayling
It is interesting. I have travelled on the Maglev line in development in Japan. It is a project that has a role to play in the Japanese transport system, but, having studied it at first hand, I do not believe it is the right project for this country, and nor do I believe it could deliver the level of capacity that HS2 will. HS2, of course, is a capacity project that brings with it speed, not the other way around, and that is what our transport system needs more than anything else. It is crucial, too, to the development of the north of England, which has a population of more than 15 million and over 1 million businesses, and which has exports worth upwards of £50 billion. The north of England makes a huge contribution to the success and prosperity of this country, but it needs strong and effective new transport links, and this project will be an important part of that, which is why it is so important to the whole UK.
Dame Cheryl Gillan
The Secretary of State says this is now about capacity, but please can he not change history? When this was first proposed, including the route through my constituency, it was all about speed; otherwise it would not have been allowed to travel on a route that will cause so much environmental damage.
Chris Grayling
My right hon. Friend will know that I have been consistent all the way through in talking about this as a capacity project. I know that she and I are on different sides of the argument, but, from the time I was shadow Transport Secretary a decade ago, I have always talked about this improvement in terms of capacity, and I will continue to do so, because that is the most important part of it. We can debate the rights and wrongs, but I believe it is a capacity project—the speed is a bonus. I do not believe in building something with old technology—we should have a state-of-the-art railway—but the big difference this will make will be to capacity.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
I welcome the Bill, but I note that the Minister referred to connecting the west midlands to HS2. What about the northern powerhouse and Liverpool’s connection to the new high-speed line?
Chris Grayling
I did mention the northern powerhouse. In terms of Liverpool, which, as the hon. Lady knows, is a city I have great affection for, as we move beyond the Bill and develop northern powerhouse rail and integrate what needs to be done in the north with the north-south routes and HS2, I believe that all the great cities of the north—Liverpool, Manchester, Leeds, Newcastle, York, Hull—will benefit, as indeed will places further north, such as Carlisle and Scotland. I will come back to Scotland in a moment.
Sir Kevin Barron (Rother Valley) (Lab)
If that is the case and Ministers are concerned for the north, why has electrification between cities in the north been cancelled?
Chris Grayling
As I have said many times in the House, we are delivering a process of modernisation on the midland main line that will transform journey times and deliver much improved rolling stock and brand-new trains much sooner. Our proposed model will deliver the improvements people want in the early 2020s, which is sooner than any other project would have done.
Anna Soubry (Broxtowe) (Con)
I am grateful to the Secretary of State for giving way; he is being very generous so early in his speech. I agree with him: it is about capacity. We cannot have an effective, modern society unless we have capacity, and we have to have good infrastructure, which means connectivity. Would he therefore consider advancing the Government’s excellent plans for HS2 by bringing on the other piece of the Y to Leeds? I believe that people throughout the whole of the east midlands support HS2, and we want it as soon as possible, please, especially at Toton in Broxtowe.
Chris Grayling
I absolutely agree with my right hon. Friend. Toton is going to be a fantastic centre in the east midlands for commercial development—transport and residential—whose benefits will ripple out across the area and have a hugely positive effect on the whole of the east midlands. I understand her point. We are working as fast as we can to bring before the House the powers we need for the east midlands and Yorkshire leg. I want to get it right—there are sensitivities on the route, as she will know—and I have travelled much of the route myself and looked at the issues as and when they arrive. We will do everything we can to minimise the impact on residents—I understand that such major projects have a negative effect on some people—but I assure her that we will bring the measure for the rest of the route before the House as soon as we can.
I have talked a bit about the north. Let me now talk about Scotland, because I want it to benefit from HS2 on the day it opens. When the full Y network opens in 2033, HS2 trains will run seamlessly on to the west and east coast main lines from the network that is then built. My Department and Transport Scotland are working closely with Network Rail in looking at options that will go beyond HS2. We want to identify options for strong business cases that can improve journey times, capacity, resilience and reliability. Our ultimate ambition is for three-hour rail journeys between London and Scotland’s central belt—a further strengthening of the Union that we all hold so dear. That, I think, is the point: HS2 will be a transformative project for the entire United Kingdom, including the parts that it does not serve directly. The benefits in terms of job creation, business opportunity and technological development will be enormous for the whole country.
Andrew Jones (Harrogate and Knaresborough) (Con)
I strongly support the Bill, and agree with my right hon. Friend’s comments about capacity in our rail network and the positive impact that HS2 will have on our northern economy. Can he tell us a little more about the impact on job creation in the north and elsewhere outside London?
Chris Grayling
I pay tribute to my hon. Friend for the work that he has done on this project. He has been a very distinguished Transport Minister. He has not only made a major contribution to its development, but has been immensely sensitive in dealing with residents. He should take great credit for that.
The point about jobs is crucial. Our industrial strategy sets out a vision of a Britain that is confident and competitive, a global trading nation that is in charge of its own destiny, and HS2 can play a big part in that. Last year we announced which train builders were vying for the £2.75 billion to deliver Britain’s state-of-the-art high-speed trains. That investment alone will create many opportunities in this country.
I have said previously that during the procurement process, as we pick the organisations that will build these trains, it must be clear that they will have to leave a substantial skills and technology footprint in this country. We will not countenance trains being built in another part of the world, put on a ship and delivered to the UK, with no benefit at all to the UK itself. This project will have a lasting impact. Indeed, the whole construction of this railway will create jobs, careers, technologies and expertise that will last a new generation of engineers for a lifetime. That is another reason why it is so crucial.
Michelle Donelan (Chippenham) (Con)
Siemens in my constituency has been shortlisted to provide the signalling for HS2, and Chippenham hopes to benefit from the fact that 70% of the new jobs will be outside London. Does my right hon. Friend agree that this project has the potential to benefit the south-west as well?
Chris Grayling
My hon. Friend is right, and I am delighted that Siemens has been shortlisted for that work. I want as much of the work as possible to be done in the United Kingdom, so that we can develop that skills footprint, developing those young apprentices and developing the engineering skills that we need for the future. That must happen throughout the United Kingdom: south-west, north-east, Scotland, Northern Ireland, Wales, south-east, midlands, the north and East Anglia. I want to see jobs and opportunities for British businesses, and businesses based in Britain.
Sir Patrick McLoughlin (Derbyshire Dales) (Con)
Does my right hon. Friend agree that we have Crossrail as a model? It is being finalised this year, and will be operating next year. That project was built on the use of suppliers in the United Kingdom, and the spread of its supply network throughout the UK. Although it was a London project, many parts of the country have benefited from it. What HS2 is doing is the natural follow-through from what Crossrail did.
Chris Grayling
Absolutely. Crossrail may be a project for transport in London, but it is also a project for engineering and industry in the United Kingdom as a whole. It brings benefits to all parts of the United Kingdom, and HS2 will bring benefits to all parts of the United Kingdom. Northern Powerhouse Rail, when it is built, will bring benefits in southern as well as northern England, and, indeed, throughout the United Kingdom. The more that we invest in these projects, the more economic benefits we will deliver across the UK.
Michael Fabricant (Lichfield) (Con)
May I ask my right hon. Friend not to take his eye off a distant ball, which is the future of the west coast main line after HS2 is constructed? More than 44 stations on that line will not be served by HS2. It is very important for passenger traffic to be maintained on the west coast main line, and to ensure that it is not used just for freight traffic.
Chris Grayling
My hon. Friend is right. As one who has sailed through his local station many times, on Pendolino trains, I believe that we can and should do better at such intermediate stations. We should provide better commuter links to Birmingham and to towns such as Northampton and Milton Keynes, and we should provide better links within the Trent valley—from Nuneaton to Lichfield, and up to Stafford. We will be able to do all those things to a greater degree in the future. Yes, there will be a freight benefit. We all want a freight benefit, because we want fewer trucks on the M6 and the M1, but the fact is that we can do both. Creating that extra capacity on HS2, or via HS2, is, to my mind, its great benefit. It will of course be a fast, state-of-the-art railway, but first and foremost it is about giving our transport system the capacity that it will need to enable us to grow in the future.
I know that there are people for whom this project is bad news. There are people who are affected by the routes, many of whom are in my hon. Friend’s constituency. I genuinely wish it were possible—I am sure that Members in all parts of the House wish it were possible—to deliver infrastructure improvements like this without human consequences, but it is not possible. What we must do is try to treat those people decently.
HS2 has not always got it right, and we will not always get it right, but I give the House today an assurance that I have given it before: when an injustice is being done, we will do everything we can as a ministerial team to sort it out. Members need only come to us and say, “This is unfair”, and we will look at it. Indeed, I have already done so in places up and down the route, and I will continue to do so, particularly in respect of this part of the project. A number of constituencies on the route from the Trent valley up to Crewe are affected. As the two Ministers responsible, the Under-Secretary of State for Transport, my hon. Friend the Member for Wealden (Ms Ghani), and I will happily talk to colleagues during this process. There will, of course, be many opportunities for them to make representations about the impacts to the Committee, assuming that the Bill is given a Second Reading today.
Maggie Throup (Erewash) (Con)
I appreciate what my right hon. Friend is saying today. We have also had many conversations about the ways in which some of my constituents are affected. That has been going on since 2013. We may get there in the end with compensation and agreements, but the problem is that it takes so long—far too long for some people. Some of my constituents are very elderly, and some are quite ill. Can my right hon. Friend reassure me, and my constituents, that we can improve the process?
Chris Grayling
I absolutely give my hon. Friend that assurance. There are processes that we must rightly follow to protect public money, but there are exceptions that always step outside what is planned. Part of the job that we have, as Ministers, is to ensure that when those exceptions arise—and I know that there are two in my hon. Friend’s constituency, which she and I have been talking about—we must resolve them before we reach a point at which those people are suffering in their lives. We are a little bit of time away from the phase 2 Bill and the process involved in phase 2b. As I have said to my hon. Friend and to other Members, we will try to sort out those exceptions so that people do not suffer inappropriately. I will continue to work with my hon. Friend to try to resolve the situation.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
While the Secretary of State is handing out assurances, may I, on behalf of the people of Stoke-on-Trent, ask for an assurance that the existing direct and frequent services from Stoke-on-Trent to London, Birmingham and Manchester on the west coast main line will in no way be diminished or reduced as a result of HS2 taking up some of the capacity through the classic compatible services?
Chris Grayling
As the hon. Gentleman will know—and I have given this assurance to my hon. Friend the Member for Stoke-on-Trent South (Jack Brereton)— I am acutely aware of the issues in Stoke-on-Trent. I want to ensure not only that the high-quality service that it deserves is protected, but that HS2 trains run through it, which is also what it deserves. I have given that clear commitment to the people of Stoke. I want them to have a first-rate rail service, and HS2 will make it possible for them to have an even better rail service than they have at present.
Let me say more about the affected communities. Last week we announced an additional £5 million for communities and businesses that are disrupted by the construction of phase 2a, which can be spent on public projects, community centres and so forth. That will add to what we have already committed in terms of the mitigation and compensation in place, and we will carry on looking at ways in which we can minimise the impact on local people and the areas affected.
Rebecca Pow (Taunton Deane) (Con)
I am totally in favour of the project, as train travel is environmentally friendly because it gets people out of their cars and on to trains. But will the Secretary of State reflect on the potential loss of ancient woodland because of HS2, and whether consideration might be given, where possible, to using tunnels so that we keep these wonderful, magnificent trees? We have only 2% of them left in the whole country. Will we consider doing this? If not, and if there is unavoidable loss, could we consider 30% amelioration, as recommended by Natural England, rather than the figures bandied about today?
Chris Grayling
I am very well aware of the potential impact on ancient woodland. We have already made changes to the design of the project to try to mitigate that impact, and there is an absolute commitment to look to plant afresh and to develop environmental measures to compensate for any loss of woodland. Also, there are some exciting potential projects on the route that can enhance the natural environment at the same time as we are having to make changes elsewhere. I assure my hon. Friend that we are very sensitive to the issue she mentions, and we will do our best to make this project in as environmentally friendly a way as possible. We cannot build something new like this across the whole country without having some impacts, but we can try to mitigate them and put money into positive alternatives. That is what we are committed to, and that is what we will do.
This is a step on the way towards creating a 21st century new rail network: phase 1 to Birmingham, phase 2a to Crewe, eventually phase 2b to Manchester and Leeds, and then across the top with Northern Powerhouse Rail, and then, through that, the connections to the north-east, which the shadow Secretary of State will hold dear, to Scotland—colleagues on both sides of the House representing Scottish constituencies are keen to see that connection put in place—and into north Wales through the Crewe hub that we are working on at the moment.
This project will provide the capacity our transport system needs in the 21st century. It will deliver better journey times and, particularly importantly, much better connections between our northern cities—Birmingham, Sheffield, Leeds—where there are poor connections at the moment; this will make a huge difference to them. But above all this is about making sure this country has a 21st century transport system. I hope the project commands support across the House. I know that some Members have issues both about the principles of the project and constituency impacts. To those with constituency impacts I simply say again that we will do our best to minimise those and to work as closely as possible with them to make sure that people who are affected are treated as decently as possible.
This Bill is enormously important to this House, to the future of this country, to our nation, to strengthening our Union, and to delivering economic growth across the whole country, and I very much hope that this House will give it its support today.
Andy McDonald (Middlesbrough) (Lab)
I am pleased to stand here today to support a project which was instigated by the last Labour Government. National infrastructure investment is too important to be left to the vagaries of the election cycle. It is to the Government’s credit that they have continued to back both HS2 and Crossrail since 2010. Labour has always maintained that HS2 must be built as a network rather than a standalone piece of infrastructure. It is this approach which will deliver the maximum economic benefits. Both main parties can agree that HS2 is about more than transport. High-speed rail is about unlocking the economic potential of the north and the midlands. It will drive a rebalancing of the UK economy by improving connectivity between the north and south.
Michael Fabricant
The hon. Gentleman talked about HS2 being an integrated network, but one of my criticisms of HS2 is that it is far from integrated. The original plan was for it to go direct down through the channel tunnel and into continental Europe and I can give other examples—I will probably will do so in my speech—but this is far from integrated: it is stand-alone, meets at Crewe and does not actually go into Birmingham New Street. Why is this?
Andy McDonald
I am grateful to the hon. Gentleman for that intervention, and it is key that HS2 integrates. We have just heard words from the Secretary of State about the need to ensure that it does connect with our northern cities, but we are yet to see those plans unfurl. We have heard about Transport for the North’s aspirations, but this cannot be a stand-alone project; it is essential that it links into our great towns and cities throughout the nation.
Linking the great cities of the north and midlands is equally important and will bring much-needed economic benefits to those regions. Labour supports the nearly 30,000 jobs the construction of HS2 will deliver and the huge uplift it will give to apprenticeships and training, particularly outside London. It is not too early to consider how we will retain and develop those skills in the future in other infrastructure projects both at home and abroad. I would be interested in any comments the Secretary of State has on this point, particularly with regard to Northern Powerhouse Rail and Crossrail.
I also make a plea that we must not repeat the catastrophe of the Carillion experience with apprentices. Apprentices in my constituency are being left flapping in the wind, not knowing whether they are going to be paid. We hear today that their employment will come to an end at the end of this month. It is a disgrace that £6.5 million of public money has gone into an apprenticeship programme that leaves our apprentices short of their qualifications and without employment. The Government should intervene now to guarantee that those apprentices will receive that assurance from this Government today.
Chris Grayling
I am grateful to the shadow Secretary of State for giving way, and he and I share that view. I can assure him that, on the HS2 project, the apprentices who were employed by Carillion are migrating to work for Kier and those employed by Carillion have been moved on to the project with the other two partners. So not only should there be no hiatus in the work taking place, but, more importantly, the people on those projects are moving to different companies involved in them. There are obviously some very difficult circumstances elsewhere as a consequence of the collapse of Carillion, but I have been very keen with this project to make sure we have the seamless transition we contracted for last summer, and I am delighted to see the apprentices move on in a way that enables them to carry on with their apprenticeships.
Andy McDonald
I am grateful for that reassurance in the context of these projects, but I am particularly concerned about these apprentices in the here-and-now; there are 100 out of the 1,400 who have been prejudiced in my community and we want to see this Government respond by coming to the table and making sure those young people have a future. It is difficult enough to encourage people into these industries in the first instance without leaving them high and dry, as has happened on this occasion.
I welcome the commitments contained in HS2’s environmental principles. It is imperative that environmental standards and air quality are at the forefront of the project. Many of the arguments about why we need HS2, and why we do not, have been well rehearsed in this House over many years: passenger rail numbers have doubled since 1995; rail freight has grown by two thirds over the same period; and the existing network has been operating at full capacity for years. No amount of timetable-tinkering can change this; I trust that all Members are in agreement about that.
Although it is important to maintain our vital road network, there is an urgent need to secure modal shift across transport: we cannot build our way out of congestion on our roads, and we must be watchful about the sustainability of domestic air travel. In addition, we face the prospect of the population of Britain reaching 70 million by the end of the decade. So the question is: how are we going to move our people around our nation? It is no exaggeration to say that the very economic and social livelihood of this country is at stake. Our capacity to move people by rail and bus is therefore crucial.
Mr Robert Goodwill (Scarborough and Whitby) (Con)
Given those circumstances and the pressure on the system, does the hon. Gentleman agree that the last thing this country needs is the nationalisation of our rail system?
Andy McDonald
I am grateful to the former Minister for his intervention. If he will be patient for just a few more minutes, I will happily address that point in full detail.
I was proud that Labour forced the Government to introduce much tougher reporting on HS2 spending through an amendment to the High Speed Rail (Preparation) Act 2013 before the previous Bill came to the House in 2014. I pay tribute to my predecessors, my hon. Friends the Members for Wakefield (Mary Creagh) and for Nottingham South (Lilian Greenwood), in that respect. We also amended that Bill to improve integration with existing transport networks and the specific reporting of the jobs and skills created by the project.
Mr Jim Cunningham (Coventry South) (Lab)
I do not want to digress too much, but this is all relevant. We only need an incident on the west coast main line for everything to stop, and that certainly needs to be looked at. Also, I have constituents who will not qualify for compensation as a result of this project.
Andy McDonald
One of the main points about this project is that it will allow us to build resilience into the network. That is not an either/or; this is not simply about building HS2. My hon. Friend is right say that we need to build greater resilience into our network. On the point about compensation arrangements, it has been noted on both sides of the House that we need to ensure that proper compensation is paid. These are really sensitive issues, and people should not be left wondering whether compensation arrangements will come forward. My hon. Friend is right about that as well.
I am keen to hear the Minister’s views on striking the right balance between HS2 services and freight on the parts of the network where high-speed trains will run on conventional tracks. HS2, the Department for Transport and Network Rail need to resolve the important concerns that are being expressed by freight operators. Elsewhere, there are significant questions to be answered about how the new high-speed railway will integrate with the existing rail network. During the Second Reading debate in 2014, the previous Secretary of State for Transport boasted that
“upgrading Britain’s rail infrastructure is a key part of this Government’s long-term economic plan”.—[Official Report, 28 April 2014; Vol. 579, c. 567.]
He also said:
“we will be electrifying more than 800 miles of line throughout the country”.—[Official Report, 28 April 2014; Vol. 579, c. 561.]
It is quite clear that the Government have broken those promises over the past four years. They made commitments on rail ahead of the 2015 general election, only to break them days later. The reality is that the last two Transport Secretaries have cut upgrades to rail infrastructure and cancelled the electrification of rail lines. Of course, HS2 is but one piece of the jigsaw. I am therefore concerned that if the other pieces are not right, the whole thing will not fit together properly.
The current Secretary of State for Transport came to the House in November to announce his strategic vision for rail. The problem was that his plan was neither strategic nor visionary. It was a smokescreen to cover up a blatant multibillion pound bail-out of the east coast main line franchise. It is clear to passengers and taxpayers that this Government are defending a broken franchising system. Under this Government, protecting private companies comes before the public interest. Giving Carillion a contract for HS2 last July while that company was imploding was an appalling decision, and the Minister’s legal justifications for that decision were risible. His bail-out of Stagecoach-Virgin on the east coast was yet another serious misjudgement in which his dogma won out over pragmatism and common sense.
Mr Bob Seely (Isle of Wight) (Con)
I think the hon. Gentleman has wandered into the wrong debate. We are talking about HS2, not about Carillion. Can we stick to the subject, please?
Madam Deputy Speaker (Dame Rosie Winterton)
Order. That is a matter for me, actually.
Andy McDonald
Thank you, Madam Deputy Speaker. The hon. Gentleman will find out what HS2 has to do with the east coast and west coast main lines if he can be patient just a little longer.
The Secretary of State’s promised east coast partnership between track and train by 2020 is unworkable and undeliverable. No one in the rail industry believes that it is actually going to happen. Another of his pet projects is the west coast project—perhaps the hon. Member for Isle of Wight (Mr Seely) will want to pay attention to this—which is going to be awarded later this year. The winner of that contract will run services on the west coast main line and oversee the introduction of HS2 services. The Government have a track record of accepting bids from the private sector that are either too high or too low, and the Department for Transport has proved unable to manage such projects. Given that the Secretary of State has been found wanting so often, what makes him think that his west coast partnership will work any better than his east coast partnership?
High Speed 2 will be the jewel in the crown of Britain’s rail network when it begins operations in the next decade. It will be a shining example of Britain’s capability and talent, and it will encapsulate our technological and engineering prowess. However, I can tell the Secretary of State that there will be uproar across the land, should this piece of the family silver be handed over to Virgin Trains, Stagecoach or others of their ilk. I can tell the House today that there will be no gift of HS2 to Richard Branson or Brian Souter under the next Labour Government. HS2 will be built with public money and it will stay in public ownership.
Sir Patrick McLoughlin (Derbyshire Dales) (Con)
I congratulate my right hon. Friend the Secretary of State on bringing forward this Bill. I also congratulate all those people in the Department for Transport and in HS2 who are working to finalise these proposals. It is a pleasure to follow the shadow Secretary of State, the hon. Member for Middlesbrough (Andy McDonald), although I think he slightly spoiled his speech by going off piste and talking about electrification. We will take no lessons from Labour on electrification, given its record between 1997 and 2010, during which time it electrified 10 miles of railway. I would like to say that that was a snail’s pace, but I think that a snail would have travelled further in 13 years than Labour did with its electrification.
Andy McDonald
The former Secretary of State seems to have totally forgotten the 67 miles of HS1 that were electrified then. Those 67 plus 10 miles add up to a lot more than this Government have ever electrified.
Sir Patrick McLoughlin
I think that HS1 was operating before Labour came into government.
Sir Patrick McLoughlin
If the hon. Gentleman will allow me, I will make some progress.
It is right to say that we have seen a renaissance on our railways since privatisation, and that renaissance continued under the last Labour Government. Indeed, in their 13 years in government, they did not seek to change the franchising at all. They felt that that was the best way to operate the railways. We had the private sector and the public sector involved, and we saw our railways improve tremendously. If we get to a situation—I hope we do not—of the railways going back to a fully nationalised body, what happened in the ’60s and ’70s will happen again. Rail was always at the back of the queue for investment. Hospitals and education took priority; the railways were left without any priority whatsoever. There is no doubt in my mind that privatisation has led to the rejuvenation of the rail industry, and so much so that passenger numbers have increased from something like 700 million to some 1.6 billion, which speaks for itself.
I am pleased that the Bill has been introduced. David Higgins recommended that we should try to bring the investment and benefits of HS2 more quickly to the north. Should this Bill get its Second Reading today, it is worth remembering that we will see high-speed services to Crewe by 2027. In infrastructure terms, and given the necessary planning, that is not that far away, so I congratulate my right hon. Friend the Secretary of State on bringing the Bill forward.
I know that the Government are well aware of this, but I want to talk about the importance of continuing to develop skills in engineering. The National College for High Speed Rail, which is based in Doncaster and Birmingham, will enable people to get the engineering skills that are so important. All that follows on from the remarkable Crossrail project, which will start to open to the public later this year. We saw such skills in the television programmes covering its development across London.
This important Bill is about capacity. There are those who say that the Department for Transport and its Secretaries of State have changed their mind and that they talk about capacity more than speed, but the very first HS2 document that was published referred to capacity, too. The west coast main line is one of the busiest lines in Europe, if not the busiest. We need a massive injection of infrastructure, and this Bill is the answer
Mr Jim Cunningham
The right hon. Gentleman is quite right that we want to speed things up and that the west coast main line is very busy, but to go back to the point that I made to my hon. Friend the Member for Middlesbrough (Andy McDonald), what are we going to do about the bottlenecks? There were cancellations yesterday, and there only has to be one incident for everything to stop. That affects freight as much as anything else.
Sir Patrick McLoughlin
I completely accept that, but the simple fact is that that is one of the reasons for the new line. We want resilience, alternatives and something that is much more modern. We have spent a fortune on upgrading the west coast main line from Birmingham up to Manchester, although I understand that we did not carry out any upgrade south of Rugby. The upgrade was essential, and if the then Government had been a bit more forward thinking, they could have built a new high-speed line then rather than doing an upgrade.
An upgrade has been undertaken, however, and it is very visible near Lichfield, for example, where the bridge has been changed as the line goes through Armitage to accommodate four tracks instead of two. There has been a huge amount of investment in the west coast main line, and that answers the question asked by the hon. Member for Coventry South (Mr Cunningham) with regard to the need for greater capacity, more alternatives, and the modern engineering that we will get from HS2. I cannot remember the exact year, but there was a time a few years ago when every single railway line in the country had problems because of weather disruption apart from HS1, which was built to a high specification with modern engineering.
Anna Soubry
I am grateful to my right hon. Friend for giving way and for his excellent speech. Does he agree that capacity and speed are not mutually exclusive? Not only will we get a world-class new line to deliver new capacity, but we are improving our existing lines. With that in mind, will he confirm how much is about to be invested in the new signalling programme in Derby, a place he knows very well?
Sir Patrick McLoughlin
More than £200 million is being spent in Derby on re-signalling and a new platform to ensure that London trains no longer have to cross the lines going to other parts of the country, thereby enabling those trains to go straight through on the main line. That is the kind of investment that is already happening in our railways up and down the country. My right hon. Friend the Secretary of State has been successful in securing extra investment not just for HS2, but for all the other railway lines that so badly need the kind of upgrades that we will see in Derby. We will no doubt complain when the station has to be closed for a period over the summer, but such a thing is inevitable if we are to achieve such overall benefit. We saw something similar just a few years ago at Nottingham station.
Mr Seely
My right hon. Friend speaks eloquently about busyness, capacity and bottlenecks on the west coast main line. Does he have anything to say about the south and south-west rail routes into London? Those routes are busier and have more capacity problems than many northern routes, but they will be unaffected by HS2 and might have their funding skewed because of it.
Sir Patrick McLoughlin
I do not think that that is the case, but there is nobody better than the Secretary of State to answer those points. The tremendous investment at Reading station has improved the whole network to the south-west. The investment at that station alone was in the region of £800 million or £900 million. Extra flyovers were put in to improve capacity down to the south-west.
Rachel Maclean (Redditch) (Con)
The improvement in overall capacity is brilliant for the people we represent in towns such as Redditch that are outside the major conurbations. The improved capacity will create an opportunity for more services from Redditch to Birmingham for commuting and jobs.
Sir Patrick McLoughlin
My hon. Friend is right that HS2 will free up a lot of capacity that is currently used not for local services, but for services from London to Birmingham and on to Manchester. That is one of the answers provided by HS2.
Gareth Snell
I thank the former Secretary of State for giving way. What does he think will be the extra capacity for commuter services around Staffordshire? There are no additional plans for commuter services under the proposals. There is no additional infrastructure, other than the HS2 route itself, so there is no immediate benefit.
Sir Patrick McLoughlin
Perhaps the hon. Gentleman wants us to have a detailed timetable for 10 years’ time, but extra capacity will become available for new services. I believe that Stoke-on-Trent will benefit greatly from HS2 because of its link, its service and its closeness to Crewe. We then have to improve some of the road structures in and around Stoke-on-Trent so that people can receive the benefit. That will represent far more investment than Stoke-on-Trent saw in any year under a Labour Government, so we can be rightly proud of what we are doing.
I fully accept—my right hon. Friend the Secretary of State addressed this—that any big infrastructure project will always lead to certain people being inconvenienced. If there were a way of ensuring that people would not be inconvenienced, we would all move for it. I am afraid that inconvenience is inevitable. It is worth remembering that the first time a railway was proposed between Birmingham and London, the idea was defeated in the House of Commons because everybody said that the canals were perfectly adequate. That was part of the problem with the west coast main line, and it is why certain diversions were built into it.
The line from the west midlands to Crewe will be of significant benefit to transport infrastructure in this country, the United Kingdom as a whole and our cities outside London by creating connectivity not just between London and our cities, but between those cities. The line is important, and it is moving in the right direction. I congratulate my right hon. Friend the Secretary of State on this proposal.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
As we look at the current Secretary of State for Transport and his predecessors around him on the Conservative Benches, it is like old times.
The Scottish National party supports the development of the HS2 project, which we have discussed on a number of occasions. Even the Secretary of State would concede that the Scottish Government have worked very positively to advance the project, but that does not mean we are not critical of quite a number of aspects of it.
For HS2 to establish the benefits that have been suggested, it needs to be expanded much further and much faster—and, as we have heard, not just to Birmingham, Manchester and Leeds, but to Scotland, and with some haste. If this project was to be truly inclusive—the Secretary of State talked about the parity in this family of nations that we are supposed to have—there is a strong argument that HS2 should have started in Scotland and made its way down through the north of England, arriving eventually at London. The economic benefits would have been dramatic had that choice been made, and it was indeed a choice. Had the Government been serious about including the nations of the UK, that could have been done. While we are talking about being serious about being inclusive, let me say that if journey times are to be improved, perhaps one thing that would help to reduce delays dramatically, as this is one key reason for delays in Scotland, would be the devolution of Network Rail. Even at this late stage, the UK Government can make a difference if they choose to do so by committing to extending the service to Scotland without hesitation.
Mr Goodwill
The hon. Gentleman talks about starting the project in Scotland, but that is not a sensible idea at all. The whole point about capacity is that every morning we have 5,000 people standing on trains into London Euston and 3,000 standing into Birmingham New Street. If the project started in Scotland, that would just mean more Scottish people standing on trains as they tried to get into the capital.
Drew Hendry
The hon. Gentleman knows that I have enjoyed debating with him and that I respect him greatly, but we always end up highlighting the fact that none of that was even looked at. No research was conducted on it. Unless he is willing to intervene to tell me about research that was conducted—[Interruption.] That tells us everything about how—
Mr Goodwill
It is patently obvious from all the traffic flows and the passenger numbers that as one gets closer to the capital, the congestion due to passenger numbers builds. As I say, we have 5,000 people standing every morning into London Euston, and there would be more Scottish people standing if we did not start in London and work our way up. It is, however, great that the time saving is going to benefit people in Scotland from day one.
Drew Hendry
I wish to remain consensual throughout this debate, but I must point out, once again, that all the hon. Gentleman has done is to confirm that no work had been done to look at the economic benefits for Scotland and the north of England.
The Secretary of State’s argument that Scotland will already be on the HS2 line is weak. I agree that journey times to and from Scotland will be faster, by virtue of the increased speed in the south of England, but given that Scotland and its people are paying for a proportion of the new infrastructure, it would be wholly wrong for the new infrastructure not to come also to Scotland.
We support HS2 because of the benefits it could and should bring, but those benefits could be greater if the missing investment were made. Clarity is also required, and with some urgency, on the Barnett consequentials. The question of the Barnett consequentials has been raised again in this House today, yet the Government have failed time and again to answer it, despite being asked to do so on many occasions.
Although this will not be well received by Conservative Members, I agree with the shadow Minister that questions need to be asked about the governance and management of HS2, given the absolute shambles the Government have got themselves into with the contract—and, of course, the honours system as well. We are talking about £2 billion-worth of contracts awarded after profit warnings were issued. Why did the Government want Carillion to continue after a 70% drop in the share price and the issuing of profit warnings? Ministers need to give answers about that, and they should take the opportunity to provide them now. There are clear examples to show that the Government knew there were more than just superficial problems at Carillion, yet the contracts just continued. Why was that?
I said earlier that the Scottish Government are committed to working in a continuing partnership to reduce rail journey times—we are working closely with the Minister to hit the three-hour target—but the Government still have not recommended a route to Scotland. Is it going to be on the east or the west coast? They must now start to work on the best options for Scotland, consider the benefits and different business cases, albeit belatedly, and deliver so that people in Scotland get some value.
If the Government share the ambition of delivering sub-three-hour journey times, we will support that, but the project should not be about only times or the physical build. As the right hon. Member for Derbyshire Dales (Sir Patrick McLoughlin) said, we must consider skills and opportunities. He mentioned Crewe and other locations, but unfortunately he did not mention Scotland. This project can and should build skills, expertise, capability and jobs for a generation, but it also needs to be inclusive in terms of its opportunities and STEM objectives. We should be alive to the chance to provide opportunities to young people, especially girls and young women, who do not get mentioned enough in this context. Scotland has successfully delivered major infrastructure projects, with the Borders rail link a prime example among many others, and is already positioning itself as a hub for rail expertise. The Heriot-Watt high-speed rail centre of excellence has put Scotland firmly on the map as a place for specialist high-speed rail knowledge.
Let us expand the network to Scotland with some hitherto unseen urgency. Let us hear the answers on the Barnett consequentials. Let us have guarantees from the Government on the future governance of the project. If a true partnership is desired, as the Secretary of State has stated, let us see some ambition on the preferred route, a commitment to utilising the expertise and talent of the men and women of Scotland, and investment in our centre of excellence.
Michael Fabricant (Lichfield) (Con)
I beg to move an amendment, to leave out from “That” to the end of the Question and add:
“this House, while recognising the increasing need for additional north-south rail line capacity to relieve congestion on the West Coast Main Line south of the Midlands and to improve connectivity between major cities and with London, declines to give the High Speed Rail (West Midlands - Crewe) Bill a Second Reading because (1) there are better ways to address any rail capacity issues north of the Midlands, (2) the line set out in the Bill is routed through unspoiled countryside unnecessarily damaging the environment including wildlife habitats, ancient woodlands and waterways, fails to connect via HS2 Phase 1 with HS1, the Channel Tunnel and the European continent, fails to connect directly through HS2 Phase 1 with potential airport hubs for London and the south-east of England, and fails to connect directly to existing major mainline stations and the existing rail network, (3) the Bill provides inadequate compensation to those blighted by the route and those whose property is subject to compulsory purchase orders, (4) the Bill fails to provide for sufficient public transport to disperse HS2 passengers disembarking at London Euston, and (5) the Bill does not implement a more environmentally sympathetic, better integrated, and more cost-effective route, such as the route originally proposed by Arup which would have used existing transport corridors minimising environmental damage and reducing costs by around £10 billion, and which would have connected directly with HS1 and the continent, London Heathrow Airport, Birmingham International Airport, and major conurbations.”
First, may I say how much I welcomed the Secretary of State’s answer to my question about Lichfield? Many of my constituents will be reassured by what he said. If he is half as good as his predecessor, my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin), he will be very good indeed.
Having said that, I am afraid that I must now destroy the cosy consensus that seems to be prevailing on the Opposition and Government Benches. I shall explain why. When HS2 was first envisioned, people spoke about people in Manchester, Leeds and Birmingham being able to get on to a high-speed train and end up in Paris, Lille and, indeed, even Berlin, with Deutsche Bahn. But that is not to be. We heard from the shadow Minister that HS2 is an integrated railway, but it is not. It is nothing like that at all.
Let me present a hypothetical situation. One of my constituents from Lichfield, together with his wife, two children and all their luggage, decide that they are going to give up travelling by dirty aircraft and will instead travel by clean rail down to Paris. What is the reality going to be? Imagine my constituent, the wife, the children and the baggage. They get on the train at Lichfield City station—although this applies to stations up and down the country—and end up at Birmingham New Street. Then what happens? They have to leave Birmingham New Street with the two children and all their bags and walk for 22 minutes. At this point, I wish to praise Councillor Tony Thompson in Lichfield who has done the walk and timed it. Without the children and all the bags, it took him 22 minutes to tramp across Birmingham to get to Curzon Street to the proposed HS2 station.
After all that, can the family then relax, knowing that they will end up in Paris? No, they cannot—because, instead, the train arrives at Euston. My right hon. Friend the Foreign Secretary, when he was Mayor of London, pointed out, quite rightly, that Euston has a capacity problem—not with trains arriving, because Euston is to be extended, but with getting people away from Euston, because there is not the public transport. Even if there was sufficient capacity, the family then have to tramp, yet again, either down a series of escalators and back up again, with children and with all the bags, or they walk across London to get to St Pancras.
Michael Fabricant
I will give way in a moment.
Finally, when they get to St Pancras, they can settle on the train. So much for a quick and easy journey from the north-east down to Paris.
Michael Fabricant
I will give way to the hon. Gentleman who has been trying to get in.
Ian Mearns
For 15 months, I was a member of the HS2 Bill Committee, and I did that very walk myself. I did not get a friendly councillor to do it for me; I did it myself. It took about six to eight minutes top whack. I know that, in future, the route will be better than it was then because an awful lot of construction work was going on around New Street at the time. It was six to eight minutes top whack.
Michael Fabricant
But the hon. Gentleman is thin, lithe and athletic. I am talking about a harried husband, a wife, squabbling children and loads of luggage. That is what I am talking about.
Chris Grayling
May I take my hon. Friend slightly closer to home, not perhaps in his own constituency, but alongside? Those people who seek to commute from Rugby, Coventry, Birmingham International and intermediate stations into Birmingham find that their daily journey is delayed by the fact that this line, which is two-track only and which can only be two-track, has express trains, local trains, intermediate trains to Northampton and even some freight trains on it. It is chaotic and jammed all the time. HS2 takes off the express trains and gives those people a better commute into Birmingham. Is that not something that the west midlands should champion?
Michael Fabricant
My right hon. Friend is absolutely right about that. I do not think that there is any argument about the capacity problem. It was he, or perhaps it was my right hon. Friend the Member for Derbyshire Dales, who said that the west coast main line is operating at 100% capacity and that it is the busiest line in Europe. In fact, it is a triumph in that people have moved on to those trains in their millions since the time when a Labour Government were in power, and certainly since the time of nationalisation—and we all remember those curling sandwiches. Of course there are advantages, too, but it could have been done in a much better way. It is not a connected service. What do we have now? The genesis of it all was Lord Adonis who, in 2007, came up with the idea of the route. I can tell Members that he was astonished when the Conservative Government accepted that route. Again, let me say very clearly that I am arguing not against HS2 itself, but against the way in which it is being executed. That is what I am criticising. Lord Adonis wanted an ultra-high-speed line. As a consequence, he got rulers on maps, drew straight lines, crashing through countryside, which had previously not been damaged, destroying ancient woodlands, and generally messing up the entire area.
Anna Soubry
My hon. Friend makes a very important point. I do not agree with the overall drift of where his speech is leading us to, but he makes a very good point, which is about the importance of connectivity. There is no point in spending billions of pounds on a brilliant new service unless the connectivity is there. Does he agree that, when we look at other projects, we know that the ones that work—wherever they are in the world—are ones where a person can get off one line, and move swiftly and easily, in comfort, to another line, or another piece of transport.
Michael Fabricant
My right hon. Friend is absolutely right. And that, really, is my main criticism of HS2—that it is not integrated. We cannot get on in Birmingham and end up in France and it does not connect with HS1. The sadness is that Arup originally came up with a proposal that would have done just that. The original Arup proposal would have been more on the surface, using existing transport corridors, so it would have been £10 billion to £12 billion cheaper. At the same time, it would have been less environmentally damaging, and that would have made sense. Under Arup’s plan, we would have been able to get on a train at Birmingham New Street and, as a consequence, end up in France. But no—because we were at that point obsessed with running at ultra-high speed, we decided that we would do this project with straight lines going through virgin countryside.
Thank goodness that there will now be kinks and loops—thanks, in part, to my right hon. Friend the Member for Derbyshire Dales—so that HS2 does not go smashing through the middle of Lichfield cathedral or, indeed, so that it does not damage Tatton. I remember that my former right hon. Friend, George Osborne, managed to get a few kinks in the line as well. But do you know what the irony is, Madam Deputy Speaker? The irony is that, because of all the kinks and loops, HS2 trains cannot now travel at ultra-high speed. Quite frankly, with the benefit of hindsight, we could have had a more connected train service that was less environmentally damaging and £12 billion cheaper than the present one. At the same time , it could have been something that people would cherish in years to come. Yes, they may cherish the route from Coventry to Birmingham, but I think that young people wanting to travel seamlessly to the continent by train will be sorely disappointed.
Now, I mentioned how phase 2a would affect Lichfield. By the way, Lichfield has had a double whammy because we were affected by phase 1 and are now being affected by phase 2a. Phase 2a will cause the loss or damage of 18 ancient woodlands—just on that short route—and the loss of 27 veteran trees between Lichfield and Crewe.
Michael Fabricant
Twenty-seven, yes. Do not knock that, though. We are talking about ancient trees and woodlands, which cannot be repeated. We cannot dig them up and then replant them because—hey!—they are not ancient anymore. The definition of an ancient woodland is that it has to be 400 years old with a soil structure that can only be generated when it is 400 years old. As the Secretary of State said, all large infrastructure projects will cause damage, and of course I accept that. But if we had gone with the original Arup route, which Lord Adonis thought would be far too slow—it would only run at high speed, not ultra-high speed—we would not have had so much damage.
I am very pleased to see my hon. Friend the Member for Poole (Sir Robert Syms) in the Chamber. He ought to be a right hon. Member because he chaired the High Speed Rail (London - West Midlands) Bill Select Committee for phase 1. I praise all the Members who served on that Committee, because at least I can offer my constituents the hope that, if the Committee that will be set up if this Bill goes through Parliament is half as good as his Committee, there will be improvements. If people petition and petition well, there will be changes to the route.
Finally, I re-emphasise the point I made earlier in a question to the Secretary of State. It is important that we do not lose sight of the west coast main line and continued passenger services. I believe that 44 railway stations on the west coast main line will not be directly affected or served by HS2. We still need our Virgin trains and our slower trains including the excellent service that is now being provided by London Northwestern Railway, which succeeded London Midland, which, incidentally, started off badly but improved a lot during its franchise period.
There will come a time when the Pendolinos will become unusable because they have reached their age limit. It is hugely important that the Department for Transport begins to start thinking about a replacement for that high-speed service, because Lichfield commuters do not just commute into Birmingham, Stafford and places like that—they are commuting down to London daily. One very senior guy at the BBC said to me, “Michael, I don’t have to send my kids to a private school”—this is the BBC for you, but we know about their salaries—“because the schools are so good in Lichfield, and I can afford to live in a large house with lots of land around me, which of course I could never do in London.” That is thanks to the Pendolino service.
Rachel Maclean
With regard to broadcasters and where they could be located for their jobs, does my hon. Friend not think that HS2 is a great argument for Channel 4 to be relocated to the west midlands, because the Channel 4 executives could commute from London, or wherever they like to live? They could be based in Lichfield and make their programmes there.
Michael Fabricant
They could be based in Lichfield, yes, or in Birmingham. I hope that Channel 4 will indeed move out of London. I know that this is completely out of order, Madam Deputy Speaker, but I am now putting in our bid for the west midlands on that.
I have explained why I cannot support this Bill. I will not press my amendment to a vote, but if, as I expect, there is going to be a Division on the substantive motion, I am afraid that I will have to vote against the Government on this occasion.
Michael Fabricant
It is a shame, as my right hon. Friend says. I very rarely vote against my own Government, because we are so successful in what we do, but there is this blindness about the design of HS2—and it has permeated across to the Labour Front Bench as well. I could not believe it when the hon. Member for Middlesbrough (Andy McDonald) said that it is an integrated railway line, when it very clearly is not. I will vote against this Bill, and I hope that other colleagues in the House will join me.
Laura Smith (Crewe and Nantwich) (Lab)
I am pleased to follow the hon. Member for Lichfield (Michael Fabricant). I am not sure if my speech will be quite as colourful, I must say.
The significance of this Bill for my constituents cannot be overstated. Crewe is a proud railway town. In fact, it is believed that Crewe was named after the railway station, rather than the other way around. The current station was completed in 1837 and has been recognised as one of the most historically significant railway stations in the world. Crewe was chosen after the nearby town of Winsford rejected an earlier proposal, as had landowners in Nantwich, which is also in my constituency. Nowadays, there are 23 trains passing through the station every hour, with additional, less frequent, services. The railway has shaped our history, our heritage and our culture in my constituency. It still plays a part in our local industry at Crewe Works, which has been owned by Bombardier since 2001. At its height, Crewe Works employed more than 20,000 people, but that dropped to fewer than 1,000 just over a decade ago. That gives a feel of just how much my constituency has changed.
Many of my constituents see HS2 as an opportunity for Crewe to regenerate economically and reconnect with its identity as a key player in the country’s national transport strategy. Today, I will set out the reasons why I support the Bill and the case for HS2—a project that was, indeed, proposed by a Labour Government. In doing so, I hasten to add that my support for the project is not unconditional.
One reason why HS2 has had support in my constituency is that it is not simply another project designed for the benefit of the south-east, but would benefit regions across the country. However, there are concerns in Crewe and Nantwich that as the project increasingly comes under budgetary strain, the Treasury might lack the appetite for the level of spending needed to deliver the greatest return on investment.
I am particularly concerned by comments made previously by the Secretary of State for Transport that decisions regarding the future of my constituency will be subject to affordability. We cannot afford not to get this right. As such, I ask the Secretary of State to clarify today when we will hear the outcome of the Crewe hub consultation and the Government’s plans.
If all that HS2 achieves is a fast track between London, Birmingham and Manchester, there is a very real possibility that it will reduce my constituency to little more than a bedsit on a commuter belt, where the next generation are priced out of living in the towns that they grew up in.
Helen Jones (Warrington North) (Lab)
I apologise that I could not be here for the beginning of the debate. I fully support my hon. Friend on the need for a proper, integrated hub at Crewe, not least because that makes the spur that was proposed through Warrington absolutely redundant. A proper hub would enable many more towns in the north-west to benefit from HS2.
Laura Smith
I agree, and I will come on to connectivity shortly.
Such short-sightedness would be a huge strategic miscalculation and a missed opportunity to future-proof towns such as those in my constituency from the troubling economic trends that we face. This cannot be about helping to expand the cities at the expense of squeezing out growth in the communities that I represent.
Limiting the service to two stops per hour at Crewe is simply a nonsensical proposal that will not only hold back my constituency for generations but will have consequences for areas beyond the north of Crewe and north Wales. For Government to overlook the clear business case for seven stops per hour at Crewe, or to act as a barrier to the strong local and regional ambitions, would be unforgivable.
Regional inequality is a major threat to the UK economy. Despite talk of a northern powerhouse, we are being presented with further evidence that the north-south divide remains as deep as it has ever been. Many living in left-behind towns look to the past with nostalgia and to the future with cynicism—and who can blame them? Their communities have suffered all the worst consequences of aggressive globalisation, and for very little reward. In Crewe and Nantwich, there are almost 4,000 children living in poverty, and wages are below the UK average. In fact, 28% of workers are paid less than the living wage, which is worse than the average for the north-west. Young people struggle to see a future filled with opportunities, and work no longer provides an escape route from poverty for struggling families.
In many ways, it is getting worse. A report this month by IPPR North suggests that the attainment gap between the north and the rest of England has widened to 5% at NVQ4 level, setting the north up to be the worst affected by an adult skills crisis. Another report this month by the Centre for Cities predicts that the rise of robots will deepen the economic divide if current trends continue, with almost a third of jobs in the north and the midlands vulnerable to automation and globalisation. Another report by IPPR North this month indicates that planned transport investment in London is two and a half times higher per person than in the north of England.
Many northern towns and cities are still struggling to recover from the industrial decline of the 1970s and 1980s, and this north-south divide threatens to hold back our national productivity. Some businesses choose to pay almost four times as much per square foot for their premises in London and the south because of poor connectivity in the north. Decades of inaction by successive Governments have left the north at the mercy of the markets.
There is no greater example of the need for Government intervention and strategic economic planning than the unsustainable situation we find ourselves in. The market has failed to provide any answers for the north, and HS2 provides one way in which the Government can begin to address this problem as part of a wider strategy. If delivered properly, this project will place my constituency at the heart of the UK’s most vibrant economic area, providing a successful and sustainable future for the next generation. Britain’s future in the world is surely as a knowledge-based economy, excelling in areas such as high-tech manufacturing. Such an economy will require a national transport strategy that prioritises high levels of connectivity. This requires increasing capacity and reliability, not just decreasing journey times.
Crewe is already a gateway station for the north-west, with regional and long-distance connections to the wider north-west, the east midlands and Wales. The phase 2a link will help to provide much-needed additional capacity for freight and will improve reliability for commuter services. It should be welcomed that the Government have brought forward the opening of the phase 2a link to 2027 as that will provide benefits to the north-west and beyond. Making the most out of connecting HS2, classic rail and the motorway network at Crewe could create 120,000 jobs across seven major local authority areas. Work undertaken by the Constellation Partnership indicates that 20,000 jobs would be created at the Crewe hub campus alone, with 17,000 additional jobs in the wider area.
My vision for HS2 is not as an end in itself, benefiting only businesses and commuters, but as a catalyst for the radical rebalancing of our economy, redistributing wealth from London to places such as Crewe and Nantwich and the rest of the UK. I must stress that this is not about asking London to lose out to the north; it is simply about achieving sustainability for London while allowing the north to achieve its full potential, which will benefit our entire country.
I want everybody in my constituency to feel the benefits of HS2, even if they never ride a train in their lives. Rail lines from Crewe reach out across to the smaller towns of Cheshire, to Warrington and the Wirral, to Manchester and Liverpool, to Lancashire, Shrewsbury, Derby and Stoke, and even to Scotland and Wales. A proper regional hub at Crewe, with a new northern junction to allow for maximum onward connectivity, will provide unrivalled opportunities for the whole of Cheshire, north Staffordshire and beyond. It is imperative that Crewe has direct high-speed services to key destinations, including London, Old Oak Common, Birmingham, Manchester airport, Manchester Piccadilly, Preston, Liverpool, Glasgow and Edinburgh.
As such, I support not only this Bill, but expanding the scope of the current HS2 programme to enable the interventions needed to deliver the services I have described. Although the services that run on our high-speed network will not be determined by statute, our legislative framework will determine what we are capable of achieving. It is vital that this Bill is supported today, and that future Bills do not limit our options. A proper regional hub could take advantage of existing connectivity and extend the benefits of HS2 to millions of people in the north, including those in our often forgotten towns beyond the major cities.
Mr Bob Seely (Isle of Wight) (Con)
It is a pleasure to follow the hon. Member for Crewe and Nantwich (Laura Smith). May I welcome my hon. Friend the Member for Wealden (Ms Ghani) to her new role and wish her all the best? It is very good to see her on the Front Bench.
I welcome the Government’s very considerable investment in our rail system—it is very good to see—and I support their ambitious railway agenda. There are lots of good things happening in our railway system. However, I find it hard to believe that the £52 billion being spent on HS2 could not have been better spent more broadly across the system.
I am not opposing or voting against the Bill, because I think there is little point: HS2 is going to happen. However, I think it would have been significantly better for our economy to have prioritised HS3, which is a good idea and clearly important for the north of this country, and then, if HS2 was to be built, to have started in the north and worked south, rather than the other way around.
What seems to be clear is that HS2 is extraordinarily expensive. There are poor returns, and by the Government’s own admission, a 1:2.3 ratio of return is extremely poor. HS2 harms the environment. It seems to be a bit of a muddle. Once we had straight lines and we were going superfast. Then we had bends and we could not go superfast. Then the stations did not quite integrate, and there does seem to be a problem with that integration up and down the network, which other Members have rightly spoken about.
However, my main concern is the cost to the other parts of the rail network. Again, Members have spoken eloquently about the need for greater capacity. HS2 does nothing for capacity for southern rail or for south-west rail. The south-west rail network is crying out for investment. We need rail flyovers at Woking and at Basingstoke to get more services on that line. We need to update the signalling system between Waterloo and Woking, and eventually elsewhere on the line, to improve speeds and services. We need infrastructure on the Portsmouth line, to increase capacity. Getting from London to Portsmouth, you travel at an average speed of around 45 miles an hour, and the idea that we are spending billions building a rail network to go superfast up north when we are still travelling at branch-line speeds on mainline routes in the south of England is very galling to very many constituents in constituencies across southern England.
We need also, probably, to double the track between Southampton and Basingstoke. My right hon. Friend the Secretary of State talked about a bright new future for the railways. We do not see that on southern, and we do not see it on south-west rail main lines. If I remember correctly, my right hon. Friend, whose agenda I very strongly support and for whom I have a high regard personally, has assured me that south-west rail projects are not affected by the HS2 project. So can he—or can she—put on record a confirmation that HS2 has not delayed, or has not affected the funding and supply of, south-west rail mainline improvements, or of Crossrail 2, which will benefit the users of south-west rail, if they use Clapham?
Michelle Donelan
I agree, and I want to see benefits to connectivity in my constituency, including a new station in Corsham. But will my hon. Friend accept that HS2 does benefit the UK as a whole, in the form of jobs, as I said, or because we all have a wealth of SMEs in our constituencies whose supply chains and customers are based throughout the UK, and they can only benefit from this extra connectivity?
Mr Seely
In principle, my hon. Friend makes a very good point and I thank her for her intervention. The problem is this. I return to the profit ratio—or the cost-benefit ratio. If any of us were to go to a Minister or Government Department and say, “This is a fantastic project and it has a ratio of 1:2.3,”—which are the Government’s own figures for HS2—we would get laughed at. To get a project off the ground, according to Green Book assessments, a ratio of 1:5 upwards is needed, and preferably 1:7. So 1:2.3 is a very poor return for Government money by the Government’s own figures. Anything that helps, within reason, expenditure and our economy is to be welcomed, but by the Government’s own figures this cost-benefit is dubious. I thank my hon. Friend for the intervention.
If HS2 will cause no delay to south-west rail projects, will my right hon. Friend commit to prioritising the necessary work on the south-west rail route that could speed up journey times between London and south coast destinations such as Portsmouth, Southampton, Bournemouth and, yes, the Isle of Wight—my constituency? I know that my right hon. Friend is a user of south-west rail and feels the pain of the half a million people who travel in to Waterloo every day. Will he—or will she— consider setting Network Rail and the new franchise a speed target of a 60-minute service to Southampton and Portsmouth? You can get two trains an hour down the main line to Southampton. They take about one hour 17 at the moment. If we are interested in high-speed rail, can we set a new target of getting people to Southampton and Portsmouth within the hour?
In addition, I will write to my right hon. Friend tomorrow in connection with the Island. He has been kind enough to sound positive about the needs of my constituents for better public transport, especially since we get precious little infrastructure money. In my letter, I will ask about the programme of reopening branch lines and investing in the Island line. Earlier this month, Isle of Wight Council voted to support a feasibility study on extending the branch line in possibly two directions and, working with our wonderful heritage line, the Havenstreet steam railway, to get people into Ryde, which would be very important.
My letter will cover support for investment, support for a feasibility study, and, dependent on the results of that study, support for the branch line and capital work on Ryde Pier Head to ensure that the railway line there stays feasible, continues and has a future. I am supportive of my right hon. Friend on his agenda, which is excellent, but will you assure me, considering that you are spending £52 billion on one line, that the Department will not tell me that you cannot afford a feasibility study?
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. If the hon. Gentleman is referring to the Minister, he must say the Minister, not you. I apologise for interrupting him, but this is becoming a widespread habit of Members all around the House and it must not go on. I am sorry that the hon. Gentleman is the person who is hearing this, and I am sure that other people will now be rather more careful. He is not a consistent offender; he is normally very proper in his behaviour.
Mr Seely
Thank you very much, Madam Deputy Speaker. I do apologise; I had noticed that I had written a few yous, and I scrubbed them out and put hes and shes. If my notes still contained a few yous, I apologise. As my right hon. Friend the Secretary of State is not here, I was trying to work out whether I should be using he or she, or whether we have reached a post-gender age for Ministers as well as for the rest of us.
Madam Deputy Speaker
Perhaps I can help the hon. Gentleman and the House. The word “Minister” is very useful, because it covers just about everything and anyone, no matter which gender they might be on that particular day.
Mr Seely
Thank you, Madam Deputy Speaker. On that point, I will wind up.
I am very supportive of the Minister’s agenda, whichever one we are talking about, but given that we are spending a great deal of money, will the Minister assure me that the Department will not be telling me that a feasibility study is not possible because of cost? Will the Minister assure me that if a feasibility study recommends extension of our lines, that will be supported, given that the costs involved, £10 million to £30 million, are margins of error in Government accounting in the Department of Transport? Will the Minister assure me that there will be support for infrastructure projects both for the South Western Railway network and the Island line, notwithstanding the considerable amounts of money that are been spent elsewhere?
Christian Matheson (City of Chester) (Lab)
What a pleasure it is to follow the hon. Member for Isle of Wight (Mr Seely). If he will forgive me, I might disagree with him on one point. In my view—the figures are overwhelming—the investment in infrastructure in London and the south-east, although it perhaps does not extend entirely down to his patch, is around nine or 10 times as much as that in my area in the north-west and the north of England. Plenty of people will look at the HS2 expenditure and say it is about time that the north-west of England got some expenditure.
In principle, I am very much in favour of HS2—and HS3, HS4 and HS5. Infrastructure spending is good for the economy; it generates growth, it drives growth and connectivity, and it is a good thing for the whole country. Like my hon. Friend the Member for Crewe and Nantwich (Laura Smith), however, I share the concern that what we might get is, to coin a railway phrase, the wrong type of HS2, on the basis that all we will have is a fast line linking London, Birmingham and Manchester, and no benefits will accrue to the surrounding areas. In terms of growth in this country, the cities are already overheating, whereas towns and counties—
Kevin Hollinrake
Does the hon. Gentleman therefore welcome the £300 million that has been set aside to connect HS2 with HS3—also known as Northern Powerhouse Rail—which will stretch from the west coast of the north to the east coast?
Christian Matheson
I will welcome it when it is built and when we actually have something going. HS3, or Northern Powerhouse Rail, is a slogan rather than a railway, and I look forward to its being a railway rather than a slogan. There is a real danger that the benefits that accrue will not do so for the whole country. This is a national project and the benefits that derive from it should be national, too.
In particular, I want to discuss the Crewe hub, which I was pleased to hear the Secretary of State refer to several times. We get lots of positive, warm words—if that praise is not too derogatory—about the importance that Ministers at the Department for Transport attach to the Crewe hub. However, time and again, after two years of pressing, we still have had no firm details about what format it will take or how it will integrate into the rest of the network.
I was pleased to hear my hon. Friend the Member for Middlesbrough (Andy McDonald), the shadow Secretary of State, talking about the need for HS2 to be integrated into the rest of the network. The hon. Member for Lichfield (Michael Fabricant) might have misunderstood, but that was very much my understanding, and that is exactly where the Crewe hub would come in. With the greatest respect to my good friend the Member for Crewe and Nantwich (Laura Smith), Crewe does not have a large enough population to justify an HS2 station, but the lines and connectivity radiating from it as a central hub in that part of the north-west and the north midlands would provide the services and the weight of gravity to make the Crewe hub essential to HS2.
Michael Fabricant
What the hon. Gentleman says about Crewe is absolutely right, but does he understand my disappointment that there will be two separate stations in Birmingham and two separate stations in London, instead of it being integrated there as well? While the north is important, so are the midlands and the south.
Christian Matheson
I do understand the hon. Gentleman’s disappointment. Actually, I share some of it, and if he bears with me I will come on to that in a moment.
The lines that would radiate from Crewe would include the existing west coast main line, which my hon. Friend the Member for Warrington North (Helen Jones) talked about, so Warrington, Wigan and south Lancashire would benefit, as would my constituency and hopefully, the north Wales line. Again, I say to Ministers that for the real benefits to accrue, the Chester and north Wales line would need to be electrified; I have not given up on that, even if they have.
The Crewe hub would mesh nicely with the Growth Track 360 proposals that leaders in Cheshire West and Chester and across the border in north Wales have put together to really try to mesh our railway offerings. I know that Ministers have seen those. My hon. Friend the shadow Secretary of State was extremely helpful when I talked to him about my concerns. He took them to HS2 Ltd, which was asked about the benefits that somebody from Chester might gain. This is where I come back to the hon. Member for Lichfield. Apparently, under the current HS2 proposals, those benefits would include HS2 freeing up capacity on the west coast main line, so that more trains would be able to go through, between Chester and Lichfield, on that line. He talked about the potential, over time, for the west coast main line to wither on the vine, and I share that concern. Those of us who are not in London, Birmingham or Manchester may not get the full benefits, because we will be asked to take the benefits of the west coast main line instead. Much as those are benefits, that is not the high-speed line on offer.
I detect a certain disconnect—I ask Ministers to look carefully at this—between HS2 Ltd and its proposals and the plans from Network Rail and the Department for Transport for the development of the railways. HS2 Ltd has been tasked with building the HS2 line and some amorphous idea of a Crewe hub, but we are still not sure what or exactly where it is in Crewe or of the layout of Crewe station. The plans do not fit in with the broader sub-regional plans for the growth of the railways. All HS2 Ltd seems concerned with is the delivery of the new high-speed line. I urge Ministers to look carefully at ensuring that the proposals for HS2 and others, such as Growth Track 360, mesh together in the connected way that my hon. Friend the shadow Secretary of State talked about; otherwise we will not accrue the full benefits.
I welcome the Minister to her place, and I make this plea to her: I ask that she think carefully about how the Crewe hub can be given a reality that benefits not just the big cities but north Shropshire, south Lancashire, all of Cheshire, all the railway lines radiating from Crewe, and particularly—as far as I am concerned—the Chester and north Wales line. It has to mesh together. At some point, we have to stop kicking this particular can down the road and come out with firm and deliverable proposals for a Crewe hub that will share the benefits of HS2 that will not otherwise accrue.
Maggie Throup (Erewash) (Con)
It is a pleasure to follow the hon. Member for City of Chester (Christian Matheson) and to contribute to this debate. I too welcome the new Minister to her place. I am sure we will be having many conversations over the coming months and years.
I would like to speak specifically to the reasoned amendment in the name of my hon. Friends. Although I cannot support it, I have some sympathy with it, specifically on the issue of property compensation. The compensation packages agreed under the Bill will have a significant impact and influence in the future when similar measures are agreed for phase 2b, which affects my constituency. It is extremely important, therefore, that we get it right now for those affected by phase 2a and phase 2b.
I am sure that my residents are not unique in their frustration with the process, but what are unique are the specifics around the property market in Long Eaton. The plus 10% on offer through the express purchase scheme for residents in the safeguarded area is not enough for many of my homeowners to buy a new home just two streets away. This is not acceptable. These residents, some of whom have lived in the same home for many years—often 40 years and more—are losing their homes, and for them their home is their castle. There must be an alternative for my constituents, and I hope that a way forward can be found.
I am sure that my right hon. Friends the Secretary of State and the Prime Minster agree, as they have both said in this place, that no one should lose out as a result of HS2. On 17 July last year, the Secretary of State said:
“I am clear that I do not want people to lose out as a result of this”—[Official Report, 17 July 2017; Vol. 627, c. 674.]
On 11 October, in a response to a question of mine, the Prime Minister said:
“my hon. Friend the Rail Minister is determined to see that fair and comprehensive compensation for those directly affected by the route is paid, and it will be paid as if HS2 did not exist, plus the 10% and reasonable moving costs.”—[Official Report, 11 October 2017; Vol. 629, c. 328.]
I would suggest that Long Eaton is the town most affected by HS2 across the whole of the country along any part of the line. It may not have a long stretch of the rail line—indeed, it is estimated to be only 3.3 miles—but those 3.3 miles will be directly through the town on a 16-metre high viaduct. That is why it is so important to get it right for residents who are losing their homes and those left behind, and why I ask the Minister to take another look at the compensation packages, not just for my constituents but for those affected along the whole line. For residents in relatively low-cost housing areas, such as New Tythe Street and Bonsall Street in Long Eaton, I would like to suggest a scheme that encompasses an equity share option. We should also recognise, however, that it is not just about money; it is about keeping communities together, and I believe an equity share scheme would do just that.
HS2 Ltd has a specific question to answer about why it is pursuing and progressing with special measures for the Shimmer estate in Mexborough but not applying the same principles to Long Eaton. I am also concerned by the way it is interpreting current guidelines and so often appears to be working against residents rather than with them.
It is also important to consider the impact that HS2 will have on businesses that are blighted by the project. For my local businesses, the uncertainty has existed since early January 2013. It has been over five years, with no end in sight yet. It is imperative for HS2 Ltd to improve on its poor record of engagement by engaging in early and meaningful interaction with businesses on which compulsory purchase orders have been served.
Michael Fabricant
It was certainly my experience with phase 1 that the constant changes of personnel within HS2 Ltd caused problems. There was not just disengagement between HS2 and our constituents, but, apparently, disengagement between HS2 personnel themselves, with one hand not knowing what the other was doing.
Maggie Throup
Not just people but processes seem to change, and HS2 Ltd is not passing the information on to the chartered surveyors who are working on its behalf or to those who are working on behalf of the residents.
The Country Land and Business Association has reported that rural business owners who go through the compulsory purchase process find it difficult to secure funding to develop their businesses, or have existing finance agreements reviewed. Whether it is rural or urban, the problem is the same, as some of my local businesses in Long Eaton have discovered.
The Country Land and Business Association has also told me that the Government have committed themselves to enacting legislation to provide for advance payments, and I ask the Minister to comment on that today. Business cannot continue to be successful with such uncertainties hanging over them. As many Members know, all successful businesses have short, medium and long-term business plans but they cannot operate, given the current air of uncertainty.
Let me issue one final plea. At present, many of the areas affected by the line of route have only a very narrow safeguarded area on either side of the line. I ask the Minister to urge HS2 Ltd to be realistic about the amount of land take required, and take action now to safeguard the true area needed so that residents can get on with their lives.
Dame Cheryl Gillan
I do not know whether my hon. Friend agrees with me that, so far, HS2 Ltd’s approach has been to limit the amount of compensation that it pays, and reduce it. Although it has, I believe, acknowledged that it may need to pay more to finalise claims, it is the interruption to lives, businesses and landowners that is causing so much aggravation. Does my hon. Friend agree that the Government should immediately enact the legislation to provide for advance payments, and that that really must happen soon?
Maggie Throup
I completely agree with my right hon. Friend. We need to get these things moving. I know residents whose properties, under the need-to-sell scheme, were being valued at over £200,000, but under the express purchase scheme, they were offered £140,000 for the same properties. Many of these people are elderly, and they are often quite ill. It is really distressing to see what they are going through.
In 2015, the then Secretary of State—my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin), who is no longer in the Chamber—said that the Government were committed to going above and beyond what was required by law, including discretionary measures to help more people. That is what we are talking about today—going “above and beyond”.
The HS2 residents charter aims to ensure that residents are treated in a fair, clear, competent and reasonable manner. I hope that, as we debate this hybrid Bill today and when, in the future, we debate the hybrid Bill providing for phase 2b, the charter will feature front and centre in the treatment of constituents along the whole HS2 route. They deserve that: it is the least we can do for them when we are taking their homes away.
Sir Kevin Barron (Rother Valley) (Lab)
May I begin by making my apologies, Madam Deputy Speaker? I was present for the opening of the debate, but I had to leave afterwards because I had a meeting with Mr Speaker. May I also welcome the Minister to the Front Bench?
I supported HS2 for many years. I truly believed that it would help to bridge the divide between the north and London in the south. I even defended the astonishing cost to my constituents, as I thought that it would benefit people in my constituency. However, I now believe that the case has become flaky at best, owing to a number of factors.
A Public Accounts Committee report raised a number of serious issues. It said there was a
“serious risk of fraud, corruption and error”
due to a combination of poor financial controls and other systems. It highlighted the fact that HS2 was set up eight years ago with substantial Government backing yet still shows a lack of organisational maturity. Given the huge budget that HS2 has been provided with, this is truly concerning.
The Government currently say HS2 will cost £55.7 billion to build. The costs originally started at £32.7 billion in 2010 and were last updated in 2015. Yet the National Audit Office stated in 2016 that HS2 was running £7 billion over-budget, which is not contested by HS2. This should put the official cost at £63 billion. I believe we can do so much more with this money, in particular on the electrification that this Government scrapped.
Most business leaders believe that if the north is to thrive the links between northern cities need to be improved, not just by having another route to London. Another Public Accounts Committee report says that HS2 made £1.6 million of unauthorised payments to staff during 2016-17; that is not a massive amount of money, but it is a shocking waste of taxpayers’ money. The report states that the unauthorised schemes proceeded due to weak internal processes and that there is no means for these sums to be recovered. It should concern us all that we have an organisation spending public money in such a way and that those sums cannot be recovered.
Both the Department and HS2 need to address these issues as a matter of urgency, and I believe that the relationship between the Department for Transport and HS2 was an unhealthy one and the necessary checks and balances were not in place. I do not think they are now either, but I will not raise issues that concern me at a local level because we are discussing a different part of the plan.
With all this in mind, I no longer believe that HS2 is likely to fulfil the aims it was designed to achieve. I will therefore vote for the amendment declining to give the Bill a Second Reading. I no longer have confidence in HS2 Ltd or the Government’s ability to oversee it.
Sir William Cash (Stone) (Con)
I want to make clear straight away, on behalf of my constituents and in the light of my personal views on this Bill, my vehement objection to the proposals before us. I will vote against the Bill if there is a Division, which I rather think there will be. I have discussed my objections on various occasions both before the House and locally; they derive from the vast impact on my constituents in Baldwin’s Gate, Bar Hill, Whitmore and Madeley and the surrounding area, and Yarnfield and Stone and surrounding areas, as well as from my scepticism about the Government claims on the benefits of the HS2 scheme in general.
The Government in their 2012 national planning policy framework set out the three pillars of economic, social and environmental factors that all new plans must satisfy. I find it incomprehensible that the Government can so ignore their own framework on a national scale in relation to the HS2 scheme.
First, I shall comment on the lack of benefits in the proposed phase 2 scheme. Its cost is £3.48 billion, a figure that is bound to rise as the project proceeds. This has not been enough to stop it being characterised by the Country Land and Business Association as full of
“delays, secrecy, broken promises, and poor management.”
This has directly damaged already-strained relationships with those most affected by HS2 and is preventing the complaints of those involved from being heard effectively.
Moreover, the actual overall costs, which are escalating all the time, are incredibly badly accounted for. As the right hon. Member for Rother Valley (Sir Kevin Barron) indicated, we have seen report after report, including economic reports and independent assessments, from the Public Accounts Committee and all kinds of other committees, and it is inconceivable that the amount of money that is currently expected to provide for all this will be adequate.
There is also the problem of providing proper compensation for those affected, including advance payments, as was said by my right hon. Friend the Member for Chesham and Amersham (Dame Cheryl Gillan). I also understand the concerns being expressed by some of my constituents, who are deeply worried about the possibility of terrorist threats to the service. Associated with those threats is the inevitable delay that will be built in to the security needed to avoid them. That will increase the amount of time it takes people to get on to the trains. HS2 might go very fast, and it might increase capacity, but there is no doubt that there will also be an enormous amount of delay, because its security arrangements will have to be similar to those used for other methods of travel such as air.
Phase 2 of HS2 will also have an immensely destructive effect on the environment. The Woodland Trust has noted that, unbelievably, given the impact on the environment that phase 1 will have, phase 2a will be more destructive per kilometre. The whole scheme will damage or destroy 98 ancient woods, with 18 alone coming from phase 2a. Over 10.5 hectares of irreplaceable ancient woodland will be lost in phase 2a, as well as at least 27 ancient and veteran trees. That loss is completely unacceptable.
The environmental impact does not end there. The National Trust has stated that phase 2a of HS2 will
“impact adversely on the conservation of the special places”
that it is charged with conserving, operating and managing,
“affecting both the experience of our visitors and the lives and livelihoods of our agricultural and residential tenants.”
The preservation of our natural heritage will be jeopardised by this project.
Michael Fabricant
I am listening to my hon. Friend with considerable interest. Does he not agree that the saddest thing of all is that Arup came up with an alternative proposal that would not have damaged all those ancient woodlands because it would have used existing transport corridors? We could have done this so much better.
Sir William Cash
I absolutely agree, but unfortunately that advice has not been taken.
Secondly, I have no confidence whatever in the Government’s stated outcomes for HS2 phase 2 in building costs or in social and environmental impacts. This comes from the dismal experience of their failures over their own reports on phase 1. The House of Lords Economic Affairs Committee cast doubt on phase 1 from the beginning of the process, arguing that the evidence used to calculate the magnitude of benefit was out of date and unconvincing. The Library briefing shows how the benefit to cost ratio of phase 1 has fallen consistently over time. Nothing has been done to address these flaws in the economic modelling.
Progress on the delivery of phase 1 is similarly criticised by the National Audit Office in its 2016 review, which stated that the Department for Transport had
“set HS2 Ltd a schedule for achieving delivery readiness that was too ambitious”,
and that:
“There is a risk that the combined impact of cost and schedule pressures result in reduced programme scope and lower the benefit cost ratio.”
It also stated that:
“Effective integration of High Speed 2 with the wider UK rail system is challenging and poses risks to value for money”.
The NAO attacks the cost estimates for phase 2, which it says are
“at a much earlier stage of development than phase 1”,
with some elements currently unfunded. For the past four years, the Infrastructure and Projects Authority has put HS2 just one step above appearing what it defines as
“unachievable unless significant, urgent and often substantial action is taken.”
I ask the Minister what evidence there is that this will be done.
Cost overruns and delays have long been associated with public construction, but HS2 dwarfs the problems of the past. Think about the amount that could be made available to the public services if these billions and billions of pounds went towards something other than this white elephant in the making. We are doomed to exist in a perpetual cycle of departmental over-promising and under-delivering. In the light of concerns about the phase 1 Bill, it is impossible to trust the Government’s assertions as to the benefits of phase 2.
Thirdly, I must cast doubt over the ability of HS2 Ltd. The Public Accounts Committee accuses HS2 Ltd of having a culture
“of failing to provide full and accurate information to those responsible for holding it to account”
and states that it
“does not have in place the basic controls needed to protect public money.”
There cannot be a bigger condemnation than that. Those basic failures underline the incompetence with which the project has been conducted. Most damningly, the PAC accuses both HS2 Ltd and the Department of not appearing
“to understand the risks to the successful delivery of the programme”.
This is a Second Reading debate, and I am saying that all the reports indicate that we can have no trust in how the principal objectives of the project are being conducted. That is evident in the employment of Carillion as a key contractor on the project. A clear lack of oversight and due diligence has jeopardised public money. Those arguments mean that the Bill fails to meet the standards required of this House.
Moving to the local issues that affect my constituents, I am thoroughly dismayed with the entire project. Not only does the proposal carve through my entire constituency from top to bottom, without any immediate benefit to my constituents in terms of communication or railway stops, but many will acknowledge that the current west coast main line provides a good service and short journey times. As my right hon. Friend the Member for Chesham and Amersham has indicated, this HS2 project will be overtaken by new technologies, such as the possibility of a maglev system or a hyperloop system, and the technology used in the HS2 project is increasingly out of date. Within the timespan for the completion of the project, the money would be better spent on other programmes and public services.
Dame Cheryl Gillan
Does my hon. Friend agree that if the project involved running autonomous passenger and freight vehicles or other vehicles of the future up and down the line, it would probably be slightly more popular? The trouble is that the technology and the whole approach involved will produce something that is from the last century.
Sir William Cash
That is completely right. It is also perhaps true that travel times were quicker in those days than they are now. This project is about not simply capacity but efficiency, and I do not believe that its objectives will be achieved.
Turning to my local objections, a railhead will be established at Yarnfield during the construction period and will later be turned into a permanent maintenance facility. The relocation of the planned facility away from the original destination in Crewe has caused massive consternation to all my constituents in Stone and Eccleshall, and in all villages around the area, particularly Yarnfield. On 24 November 2016, I secured a half-hour Adjournment debate on the matter, and I have spoken in a variety of meetings both locally and in the House since then. Most recently, I had a meeting with the Stone Railhead Crisis Group on Friday 19 January. I will be offering help with petitions to anybody who wants it. I have invited the Clerk of Private Bills to meet the group, and I hope that that meeting will take place soon.
I reiterate that the way in which alternatives to the final proposition were considered was appalling. The original proposal for the railhead to be at Crewe was not selected. I believe that there has been serial misdirection and misinformation about employment and environmental issues. Crewe would have been far better, but now HS2 has decided to go for Yarnfield and the vicinity thereof, which will do appalling damage to my constituents, and their traffic and schools. Every single aspect of the development will have the most serious and deleterious effect on my constituents.
The disruption due to works at Norton Bridge has already started, and the HS2 works at Stone and Swynnerton belie the notion that disruption will be minimised—it is liable only to get worse. The HS2 phase 2 environmental statement draws attention to lighting being visible along Yarnfield Lane and on the north eastern edge of Yarnfield itself. That is on top of the significant and noticeable noise that the facility will generate, the destruction of woodland, the destruction of visual landscape and the substantial noise from construction traffic.
I am also deeply concerned about the impact on the elderly, and it is shameful that retired people who seek a peaceful rural life will find their area violated. I am also concerned about the communities that are being directly destroyed, such as two properties in Shelton under Harley. There will be noise from construction on Pirehill Lane. There are also problems for several grade II listed buildings, including Blakelow farm, the water tower on Stab Lane and the Swynnerton Heath farmhouse, in addition to non-listed heritage sites such as Darlaston pool, the milestone near Cash’s pit and areas of the Shelton under Harley farm. That is yet another example of the damage that will be done.
In an update statement on 17 July 2017, the Secretary of State for Transport assured me that Yarnfield Lane will remain open. I am afraid to say that that assurance is useless without any consideration of the impact of heavy goods vehicles travelling along that narrow road, rendering it impassable during peak hours as if it were fully closed. That is bound to have a very bad effect on my constituents’ health and welfare. The proposal to use Eccleshall Road as an access and supply route will block the whole area, which is already oversubscribed.
Cold Norton is a cluster of 40 dwellings within 500 metres of the M6, but it does not appear to be included in the documents. If the works lead to the closure of the B5026 and Yarnfield Lane, my constituents in Cold Norton, Norton Bridge, Chebsey, Yarnfield, Swynnerton and Eccleshall will not have access to their main travel route into Stone. There will also be an impact on Great Bridgeford and many other areas in the constituency of my hon. Friend the Member for Stafford (Jeremy Lefroy).
Trains will go straight down my entire constituency, from top to bottom. Baldwin’s Gate, Bar Hill, Whitmore and Madeley are in a rural area of outstanding natural beauty. The proposed scheme will cut straight through it, with two viaducts at the River Lea valley and Meece brook valley, and two tunnels along the way. There will be an enormous amount of construction work in a delicate area.
I will meet the Whitmore2Madeley action group on Friday 2 February to examine the proposed Whitmore construction site. I met the group in July 2017, and I have organised a meeting so that the group can meet the Clerk of Private Bills.
The environmental impact assessments show there will be significant quality-of-life problems at the Stone railhead. The views from Rectory Lane, Manor Road, Madeley cemetery, Madeley Park, Bar Hill Road and Wrinehill wood will all be negatively affected, and there will be traffic problems, too.
Then we have the A51 London Road and A53 Newcastle Road to consider. At least five footpaths will be closed in the process of construction. Communities and cultural heritage in the area will also suffer. Viaducts at Lea valley and Meece brook will prove to be eyesores. Nine properties will be permanently affected, including Rose Cottage and Wood Croft. Construction will cause impossible chaos for 29 residential properties in Whitmore and Whitmore Heath, 20 on Manor Road, 43 on Bar Hill Road and Mallard Close, and five at Moor Hall and Bower End farms. Furthermore, Hey House, a grade II listed house, will have its setting permanently degraded.
I now turn to the environmental cost in the area. Most prominent is the destruction of at least part of two woods—Whitmore wood and Barhill wood. The Woodland Trust points out the possible cost of this damage, noting that the
“Stone constituency will suffer loss or damage to 11 ancient woodlands, totalling 8.9 ha of loss. Whitmore Wood will suffer the greatest single loss of ancient woodland on the entire HS2 route. Tunnelling must be considered to avoid this loss.”
That is an attack on our woodland environment.
An additional 0.2 hectares will be lost at Barhill wood to allow for the Madeley tunnel portal. This forms just a small part of the argument for a longer, deeper tunnel to limit the environmental damage of the scheme, which I know that the Minister is examining. Such a tunnel would not completely remove the damaging local impact of this proposal, but it would nevertheless prevent the inefficient upheaval generated by involving multiple sites. There is an argument about this tunnel and I have been given certain assurances, but I am deeply concerned about whether the money will be made available in any case—we have no certainty about that at this stage. More specifically, the proposal for a tunnel from Whitmore to Madeley would, it is argued, avoid the destruction by HS2 works of 33% of Whitmore wood, the viaduct and embankments in the Lea valley, and the disruptive work on Manor Road. This has to be pursued vigorously so that we get to the bottom of exactly what will be involved. I understand the assurances that have been given, but there are also complications due to the relationship between the northern part and the southern part of my constituency, which will doubtless be the subject of petitions from the two groups in question.
In conclusion, I will be voting against the Bill, as I did on the previous Bill for phase 1. My constituents will be petitioning against the Bill and will appear in front of the Select Committee. I urge the Government and that Committee to do all they can to pay the most careful attention to these petitions if this Bill goes through today, and to provide my constituents with every opportunity to be heard. This is a very, very big thing for them—it is massive. Hon. Members should think what it would be like if this were to happen to any other constituency on the scale it is happening to mine, which is similar to the situation in the constituency of my right hon. Friend the Member for Chesham and Amersham. She has done a fantastic job and we will try to do the same in our area. At the moment, I am deeply disappointed with these proposals and I shall be voting against them.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
I, too, welcome the Minister to her place. I support the Bill because it brings the potential benefits of HS2 to parts of the north earlier than was envisaged—2027 is a lot better than 2033. HS2 is visionary, but that vision will be realised only if the high-speed network is linked to the existing classic network and if regeneration takes place not just at high-speed rail stations, but in areas around those stations and beyond, in supporting transport links and investing in businesses. Local enterprise partnerships, perhaps working together and looking across regions, need to put together regional strategies to ensure that transport investment leads to more opportunities for business, employment and skills.
We have said a great deal about the importance of high-speed rail, and HS2 specifically, in bringing new capacity on to our rail line. That is, in essence, what this is all about. But in ensuring that that increased capacity is maximised, we have to look at how we can develop services on the classic line once the high-speed line has been built. We also have to remember the importance of developing freight links, as freight routes are essential. In areas such as Liverpool, among others, where port trade is developing, it is crucial that new freight lines are made available. One of the strong reasons for HS2 is that the existing lines running passenger services on the west coast main line are virtually full and there is simply no space for freight. As we develop HS2, it is essential that thought is given to freight.
Let me turn to some specific issues that affect the north in general and Liverpool in particular. I emphasise the importance of Northern Powerhouse Rail, which has already been mentioned, for people throughout the north. I certainly welcome Transport for the North’s having been put on a statutory footing in the past couple of weeks. Nevertheless, when will the transformational changes promised by Northern Powerhouse Rail and Transport for the North actually be realised? It is important that those changes happen so that places such as Liverpool, Manchester, Sheffield, Newcastle and Hull have much better lines of communication between them as part of the development of their economies.
I welcome the setting up of Northern Powerhouse Rail because it goes beyond the parochial and shows that we are looking at things on a regional and cross-regional basis. That is the only way we are going to bring real economic changes to our communities, but those changes have to take place in a reasonable timescale. They must not remain simply promises for the future that do not actually happen. It is important to restate that although Northern Powerhouse Rail is extremely important for Liverpool and for the north, it is not an alternative to HS2. It is foolish for people to suggest that.
Mary Robinson (Cheadle) (Con)
I, too, welcome HS2 for the very same reasons. There needs to be investment in the north. What with the £70 billion of investment in Northern Powerhouse Rail over the next 30 years, we have an opportunity to get the vision off the ground and really make a difference in the north of England.
Mrs Ellman
I agree with the hon. Lady. It would be a grave mistake to have a new high-speed line from London to Birmingham that stopped there and left the rest of the country to deal with lesser investment that will bring fewer economic development returns. We need both.
The case has long been argued that Liverpool needs a direct link to the new high-speed line. I recognise that the existing plans will bring benefit to Liverpool in terms of increased capacity and quicker journeys between Liverpool and London and between Liverpool and other cities. Nevertheless, for Liverpool to benefit in a way that is comparable to other major cities, there needs to be a direct link. Proposals have been developed for a new line so that Liverpool can have a direct link to both Northern Powerhouse Rail and HS2. However, the exact status of those proposals is unclear to me. They have been worked up in considerable detail and put into various potential plans, but will the Minister tell me exactly what their current status is?
I asked the Secretary of State about this at the start of the debate. I welcomed his comments about his support for Liverpool—indeed, he said that he was very fond of Liverpool and reiterated that it would benefit from HS2—but he was not specific about how anything was going to happen. What progress has been made on linking Liverpool directly with both HS2 and Northern Powerhouse Rail? Liverpool is increasingly successful, partly because of its transport links, but for its potential to be realised fully, we must improve this even more, which means having a proper connection to high-speed rail, along with investment in the classic rail system and in Northern Powerhouse Rail.
Liverpool’s new deep-water container port is extremely important. It is important to have freight links to the northern ports. We are developing as an increasingly important logistics centre and as a visitor destination, and the growing cruise line sector is extremely exciting, which means that Liverpool needs to maximise its transport links. I hope that I will get a proper answer from the Minister on those issues.
I will just refer, too, to some concerns about how the Crewe hub is intended to develop based on the information that is available now. There are proposals to do with splitting trains at Crewe, which could adversely impact on current plans for high-speed Liverpool to London journeys. I query whether improvements will be made on Liverpool to Birmingham journeys in the way that they were first envisaged. I ask for that to be looked at again during the further discussions that will inevitably take place.
In summary, I welcome this Bill. It is a great step forward. I support high-speed rail; I think it is visionary, but for that vision to be realised, there must be continued investment in the classic line, new lines where they are required and business regeneration connected with that transport development to develop new regional economic strategies that will help to transform the north.
Jeremy Lefroy (Stafford) (Con)
I rise to oppose the Second Reading today for reasons very similar to those given by my hon. Friends the Members for Lichfield (Michael Fabricant) and for Stone (Sir William Cash). I echo the words of my hon. Friend the Member for Lichfield—I am not at all opposed to additional rail capacity, or indeed to relatively high-speed rail capacity. The problem with the Bill before us now is that it is capable of pretty much no amendment. Yes, there can be very small adjustments made, but none of them would do anything for my constituents who are hugely affected by this development.
First, I want to talk about why the Bill, and indeed the whole project, is wrong in principle; secondly, about the specific problems that we face in the Stafford constituency; and thirdly about some suggestions for how those problems might be ameliorated. We do not need a 400 km an hour line in the United Kingdom, with the little connectivity that these proposals give us. As my hon. Friend the Member for Lichfield has said, the line is forced to go so straight that it does not take the most appropriate and sensitive route. A line of 250 km to 300 km an hour would have been easily adequate. In fact, it is very unlikely that the trains will ever reach anything more than that.
In my constituency, the line seems to head straight for the villages, and not for the open countryside. It affects four villages directly, and it is adjacent to a fifth. I would welcome any hon. Member who wants to come for a visit to note the impact on this part of the world—in Staffordshire and in the constituency of my hon. Friend the Member for Stone. Lots of alternatives have been put forward. We have already heard about the Arup alternative. There is also the High Speed UK alternative, which provides much better connectivity between 32 prominent cities of the UK. I have looked at it in some detail. I am sure that holes can be picked in it, but those holes will be considerably smaller than the ones that can be picked in the proposals that are before us now. This is the wrong solution to a problem that we undoubtedly have.
Just before people say that this is simply a nimby attitude, I point out that both my hon. Friend the Member for Stone and I have supported an extremely large rail project in our constituencies, which came at some inconvenience to our constituents, but nevertheless we saw the benefit of it. That was the Norton Bridge junction, which has increased speeds on that line, and increased capacity on the west coast main line. Indeed, before I was elected, I supported the proposal of the previous Government on the Stafford bypass, which also had an impact on my constituency.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I was in Committee upstairs, and came down particularly to hear the hon. Gentleman’s speech. He knows that I passionately oppose HS2. I applaud his opposition, and would love to make the visit to his constituency to see the degradation, because £100 billion of expenditure should go not on this, but on a decent railway service across the north of England.
Jeremy Lefroy
I am most grateful to the hon. Gentleman. He is welcome to visit my constituency; we will make an arrangement. He will see the beautiful countryside of the upper Trent Valley, and I am sure that my hon. Friend the Member for Stone would also show him across Swynnerton Park and up towards Madeley, so that he can see the effect of the line on those areas.
The business case is another reason I believe this is the wrong project. We have heard from other hon. Members, including my hon. Friend the Member for Isle of Wight (Mr Seely), that the business case is not particularly compelling. In fact, our former colleague and former Chair of the Treasury Committee, Andrew Tyrie, said that HS2
“has the weakest economic case of all projects”
within the infrastructure programme. As has been mentioned, there is a hole in the business case. That is, there is no business case that I can see for the continuation of the existing west coast main line without the revenue from the high-speed services that currently use it and generate most of its revenue. How will that line be maintained? Will it be maintained purely with the revenue from local and regional services, on which prices can be extremely low? Will that generate enough revenue? Alternatively, will it be maintained using revenue from freight services? I do not know, but there is not a business case. I have asked for it and it has not been provided. I urge the Government—particularly if they are about to put out to tender for the package of HS2 and the west coast main line—to insist that we have a proper business case for the entire package, not simply for HS2.
Sir William Cash
Does my hon. Friend agree that this has all the hallmarks of a vanity project and that that is why there is not a proper business case? To a certain extent, that answers his question.
Jeremy Lefroy
Well, I am not sure that it is a vanity project because, if constructed, it certainly will bring benefits to the country, although probably at much more expense than it should and at a huge cost to our constituents. When I challenged a very senior person who has been involved in this project in the past, they said, “Well, actually, it’s gone too far. We wouldn’t have started it here but we have gone too far.” The west coast main line was started, I think, in the 1850s—possibly even earlier—so this project will last for 200 years. What is a few years to get this right and to put it in the right place? I shall return to that point.
On the problems, let me start with the problems for people because people are the most important. I get pretty frustrated when HS2 staff come around to count bats. Yes, bats have importance, but my constituents are more important. HS2 is prepared to spend an awful lot of time and money counting bats and various other things, but not talking to my constituents. I have constituents who have waited for a visit for a year. These constituents have dairy farms, and HS2 wants to take 100 acres away from their farm, which would make a dairy farm unviable. Only last week, a constituent of mine suddenly received a letter from HS2 indicating that his entire property was needed, when it had previously only needed a very small part. I have a strong objection to the uncertainty and inefficiency with which my constituents have been handled. That is not to criticise every single employee of HS2. I have met some extremely good ones. There have been some who I would praise for their work, but there have been others who, I am afraid, have fallen short.
Dame Cheryl Gillan
I do not entirely agree with my hon. Friend that bats have no importance whatever, but I do agree with him that people are important. He may actually experience what I experienced in my constituency, whereby HS2 implied and said that it was going to take a property and then decided that it was not going to take it, which can also have severe implications for businesses affected in that fashion.
Jeremy Lefroy
I entirely agree. I apologise if I gave the impression that I do not care about bats at all, but I care about my constituents a little bit more. There are also the issues of the slow process, the lack of engagement, totally unnecessary arguments over valuations and a lack of knowledge. For example, one constituent of mine was not aware of what was going on. He sold the property after the line was announced and made a huge loss, but was then unable to claim for that loss because he was told that he should have gone through the process. This elderly gentleman was basically robbed of tens of thousands of pounds simply because he did not quite understand the system. Will the Minister see whether there is some way that we can get compensation for my constituent, who deserves it? I have constituents, an elderly couple, whose property is going to be boxed in by the works on HS2—literally boxed in. Yet, as things stand, they are not going to be allowed to sell their house to HS2, for reasons I fail to understand.
Then there is the impact on communities and the environment. The line runs adjacent to Great Haywood. It goes through Ingestre, Hopton, Marston and Yarlet. These are mainly old and ancient villages with strong communities. Hopton has lost a lot of its population already because people have moved out. There is not the community there that there was, because HS2, although it is renting out to people some of the properties that have been sold to it, is not doing so quickly. Naturally, the people who are coming in, perhaps for the short term, are not able to join in the community as much as others would.
Sir William Cash
Does my hon. Friend recall the impact that this will also have on Yarlet School, which is a very serious problem for those who have this fantastically good school and the facilities that go with it?
Jeremy Lefroy
I do indeed. The line goes pretty much straight through Yarlet School, and not only that but through Yarlet wood, which is one of our ancient woodlands. I think it is even noted in the Domesday Book, so it is the best part of 1,000 years old.
Another very important part of Staffordshire life that the line goes straight through, or almost straight through, is Staffordshire showground, which hosts not just the county show but hundreds of other events every year, with probably the best part of 300,000 or 400,000 people attending. It is a very important employer and economic entity within my constituency.
The line goes very close to Shugborough. The irony of this is that when the west coast main line was put through Shugborough in the 19th century, the Earl of Lichfield persuaded the railway company to build a cut-and-cover tunnel through Shugborough, which one still sees when going on the main line up to Liverpool. We have been unable to persuade HS2 to provide such tunnelling for my constituents. Clearly, where the railways would listen to the Earl of Lichfield 150 years ago and more, they do not listen to the ordinary people today who would like to have some protection from this line. The line also goes pretty much straight through the beautiful Ingestre and Tixall parklands and landscapes.
The next issue is transport infrastructure. The line cuts straight across several major roads, including the A51, the A518, the A34 and the M6, and goes over the west coast main line. As far as I can see, HS2 and Highways England do not seem to have a plan on how to manage the inevitable disruption to local, regional, and indeed national transport that is going to be caused. I hope they do have one, because the M6 must be, if not the busiest motorway in Europe, then one of the busiest, and the A34 is a kind of relief road for the M6. If both of those are going to be disrupted, particularly if it happens at the same time, the consequences for the regional and national economy, right up to Scotland, will be quite substantial.
Another problem is connectivity after HS2. Clearly, connectivity from Stafford will be better. There will be a faster journey from Stafford to London than at present. It is already an extremely good and fast journey—nobody has complained to me about it in the past—and it will, I admit, be a few minutes faster. Northbound, we are really concerned about connectivity, because we understand that the trains through Stafford and Stoke will end at Macclesfield. I have nothing against Macclesfield; in fact, it is a wonderful town. However, most of the time my constituents tend to prefer to go further to Manchester and Liverpool rather than to stop at Macclesfield. As I say, I have nothing against Macclesfield.
The next problem is the impact on businesses. Last week, I heard from a business that received, out of the blue, a letter saying, “We want all your land.” This business employs a large number of people in a rural area; it is possibly the biggest employer in that area. Yet suddenly, with literally no notice, we are suddenly told that HS2 needs the entire plot that it is working from, without any alternative.
Mr Sheerman
I rarely agree with the hon. Member for Stone (Sir William Cash), but I do in this case, about this being a vanity project. Does the hon. Gentleman accept that this is not really about connectivity or helping local industry? As he says, it will damage local industry. The French experience already shows that it does not liberate and rejuvenate the provincial cities and towns. It actually drains even more power and influence down to London and the metropolitan area around the south-east.
Jeremy Lefroy
I largely agree with the hon. Gentleman. I fear that that will be the case unless, as speakers both in favour and against have said, connectivity is taken much more seriously. I urge Ministers to look at the proposals of High Speed UK, even if they do not like those proposals, because it has some extremely important points to make about connectivity for other major cities in the UK.
If the line goes ahead—it seems there is a majority in the House at the moment for it, but that may change— I would like to make some proposals. First, for my constituents and my colleagues’ constituents, we must employ full-time sympathetic and responsive liaison officers who work together with businesses and constituents to ensure that problems are dealt with quickly, efficiently and compassionately. We must also give additional support to local health services. Quite a large number of my constituents have found this a very difficult time and have needed additional support, particularly with their mental health, and local surgeries have not necessarily had the resources to provide that.
It is very important that local people see that there are local jobs in this, and that people are not just brought in. Obviously we need the right skills, but as far as possible, local businesses and local people must be employed.
On the issue of mitigation, I urge the Minister, who I welcome to her position and congratulate on her appointment, to look at more tunnelling, particularly in the area of the Staffordshire showground, Hopton, Marston and Yarlet. I think it is possible. A green tunnel was proposed for Hopton, but it was removed on spurious grounds, or at least grounds that could have been overcome.
I ask the Minister to ensure that we have full planning well in advance for local, regional and national transport, including additional roads. I suggest a link between the A34 and junction 13, just as we have a link between the A34 and junctions 14 and 15. The very long viaduct at Great Haywood must be of outstanding design and faced with traditional stone or brick. I also suggest that the bridge constructed over the M6 for the railway or at least the supports for it should be put in place when the M6 is widened between junctions 13 and 15, rather than having to close the motorway for two separate civil works.
In conclusion, I would rather the Government paused, rethought and built for the whole country, with much better connectivity than this proposal gives us. If this goes ahead, at least for the time being, I ask that all the mitigations that my colleagues and I have put forward be taken seriously, because to date, they have not been.
Several hon. Members rose—
Mr Speaker
Order. I remind Members that, as they can see for themselves, seven hon. Members are still seeking to contribute to the debate, therefore there is a premium on reasonable brevity. If each contributes for no more than 10 minutes, all should have the chance to do so before the winding-up speeches begin.
Jo Platt (Leigh) (Lab/Co-op)
You will be glad to hear, Mr Speaker, that I intend to speak only briefly, to raise one particular concern that I believe needs urgent consideration by the Government as the HS2 process continues.
HS2 has the ability to rejuvenate the northern economy, bringing with it the much-needed investment, jobs and social transformation that the north deserves. However, to me, HS2 is not just about connecting businesses and bolstering economies. It represents a crucial mechanism to connect people with the skills, education and employment opportunities that could improve life chances.
As I have been clear since my election to this House, connectivity into HS2 stations must be addressed by the Government, because unless connectivity is adequately addressed, HS2 is at risk of becoming a token flagship project that will fail to produce the important benefits we are promised in the north. Such connectivity means connecting our towns and outer cities seamlessly into our HS2 stations, creating a united and interconnected northern economy.
As my hon. Friend the Member for City of Chester (Christian Matheson) so rightly pointed out, the Government need “to stop kicking this…can down the road”. At the Tory party conference, the Transport Secretary announced that £300 million would be allocated to HS2 connectivity in the north. However, inspection of the detail of the announcement showed that this money was already allocated to just six city hotspots across the north, totally neglecting the economies and opportunities of our northern towns.
Furthermore, the new Minister suggested two weeks ago that my constituents could access HS2 from Manchester airport, but Manchester airport is a one hour 30 minute bus trip away. How can the Government ever claim to be committed to our town economies when they believe that that is acceptable and that, despite HS2 cutting through the middle of my constituency, it will take longer for my constituents to connect to HS2 at Manchester airport than to travel onwards to London?
The connectivity plans as they currently stand are completely unacceptable to our region, but it is for the young people in Leigh that I wanted to speak in this debate. They are growing up in the context of an evolving economic landscape that they will not easily be able to participate in. In the words of the former Conservative Education Secretary, the right hon. Member for Putney (Justine Greening), the
“bottom line is that while talent is spread evenly in our country, opportunity isn’t”.
Until the Government either invest in our northern towns or provide our transport bodies with the funding to do so, these enormous infrastructure projects will benefit only those growing up in our inner cities. The divide between our towns and our cities is growing ever larger under this Government. This will restrict the life chances of an entire generation who are being held back solely because of their postcode. I therefore urge the Government to review their connectivity plans and seek to widen the opportunities that HS2 could provide to our young people.
Dame Cheryl Gillan (Chesham and Amersham) (Con)
It is a pleasure to follow the hon. Member for Leigh (Jo Platt). I share her pain, because HS2 phase 1 goes right through the middle of my constituency and brings no benefits, just burdens. I think there are many such seats, as we have heard from other hon. Members on other occasions, as well as today. I agree with her about the north. My father was in steel in the north of England, and we have always known that to assist in increasing the prosperity of the north of England, the cross-Pennine links should have been prioritised a long time ago. It is a pleasure to follow her short but elegant speech.
May I welcome the Minister to the Front Bench? My hon. Friend the Member for Wealden (Ms Ghani) is an extremely capable person, although I have to say that I do not envy her her task. She follows in the footsteps of no less than—let me see—one, two, three, four, five Secretaries of State and one, two, three, four, five, six junior Ministers. Since 2010, it appears that no Minister has managed more than two years in this position in charge of HS2. I would not have wished HS2 on her, but I hope her ministerial career will last a great deal longer than that. I wish, however, that her colleagues would listen and that we could have a Minister dedicated to HS2 on its own, because this project is such a gargantuan one that it really deserves to have ministerial attention focused on it completely. If we look at the project’s history since its inception, with the catalogue of failures and problems it has thrown up, we can see that a Minister dedicated to it is much needed and would be very welcome.
Mr Speaker, I feel like saying, “Here we are again, and yes, I am on my feet.” I think we probably do divide into sheep and goats on the Floor of this House as far as HS2 is concerned. Whether I am a sheep or a goat I do not know. I am probably an old goat, but I am happy to stand up here with some other old goats, like my hon. Friends the Members for Lichfield (Michael Fabricant), for Stone (Sir William Cash) and for Stafford (Jeremy Lefroy), and even the hon. Member for Huddersfield (Mr Sheerman)—most of whom happen to be in the Chamber at the moment. I have been really heartened by the support that I have had over the years as I have tried to fight this project, and then tried to have it altered and modified so that it did less harm than was envisaged.
Mr Sheerman
In passing, I congratulate the right hon. Lady on becoming a dame. Is it not a fact that she and I have campaigned against this project for a very long time, on the grounds that it will not deliver, it will never deliver, by 2033, and it will be superseded by different forms of transportation by 2033, and also on the grounds that £100 billion of national treasure that could have flowed—I say this as a Labour MP—into the national health service and transport across the north will have been wasted?
Dame Cheryl Gillan
I am loth to agree with the hon. Gentleman entirely, but I find myself tempted to do so, because the first point I want to mention is cost.
The cost of this project will go up exponentially. When it was first announced in 2013, the cost of the whole project was about £16 billion, and by 2015 those costs were updated to £55.7 billion. The National Audit Office published a report on HS2’s progress and preparations, and it highlighted the fact that the £55.7 billion funding package does not even cover the funding for the activity needed to deliver the promised growth and regeneration benefits that the hon. Member for Leigh so desperately wants for her young constituents. I think that still continues to be a problem, and I would ask the Minister to have a look at when she can update the costs of this project, and ask her to lay out clearly for the House what extra funding will be required from the Treasury to deliver those growth and regeneration benefits that have been so much boasted of.
I think HS2 will turn out to be, as Michael Byng said, the most expensive railway on earth, at £403 million a mile. In fact, Michael Byng, who created the method used by Network Rail to cost its projects, made the estimates for the DFT and said the line would cost double the official figure, and 15 times more than the cost per mile of the TGV in France. We need to be very careful about how those costs are escalating.
I want to mention the environment. I have had some notable gains in Buckinghamshire—our own county—to save the Chilterns from even greater damage than was first anticipated. I am grateful for the tunnelling. It saves some 9.2 hectares of ancient woodland in three separate woods, but the Woodland Trust has estimated that on phase 2a and 2b it is losing 24 irreplaceable woods, and we shall still lose 63 ancient woods on phase 1 to start off with. I say to the House: once they have gone, they are lost forever. You cannot replace ancient woodland, however much planting you do in other areas of the country.
I want to mention the process. I think the hybrid Bill process for phase 1 was a travesty of our procedures, and I pay tribute to the Chairman of Ways and Means and the House authorities who looked at the Standing Orders and changed some of the aspects of a hybrid Bill to improve the petitioner experience. I want to place it on the record that I think our Clerk who is no longer with us, Neil Caulfield, who was so excellent, would have been pleased to see adjustments to these procedures. Although it is still an arcane process, I think it was important that we fed back the agonies of going through the hybrid Bill process, and that the House responded. I think the positive changes that have been made, particularly the changes to the language, which will increase accessibility to the petitioners, will make a difference and protect the rights for petitioners to be heard. I also think that submitting petitions electronically is a way forward. I still think that the fee of £20 to fight for one’s house, business, land or property is insulting, and I see no reason why petitioners must pay £20 to have their case heard when the state is trying to take their property.
I also feel that corridor deals need to be stamped out. Corridor deals conducted by silks and barristers acting on behalf of the Government are completely opaque and have no enforceability. There is intimidation and pressure from the QCs and the legal teams, hustling up to people in the corridor right before their petition is heard. I hope that the Government will listen and ensure that corridor deals are stamped out completely in this next legislative phase.
I want to refer to engagement by HS2 and the attitude towards the people affected. My colleagues have spoken eloquently already about the ways in which HS2 and its staff and personnel still fail to engage with the people who are most affected by this project. I am still hearing of poor engagement up and down the line, and the Country Land and Business Association reports delays, secrecy, broken promises and poor management.
We are still waiting for answers on various matters, such as the incident that took place in the Colne Valley the other day. I asked for the outcome of the investigation, because I thought that was quite a serious incident. I have still not had any response outlining exactly what happened and why people behaved in such a fashion to people crossing land that would be affected by HS2.
I would also very much like to find out what is happening in my own constituency, in Buckinghamshire. The other day, the Secretary of State promised that I and other MPs would be informed where works were taking place and that has not yet happened. The Secretary of State gave a categorical undertaking at that Dispatch Box, but messages I have had none.
Only today, despite a clear, agreed contract with HS2, a constituent has found that the payment they were due to receive within 21 days is still outstanding three months later. I will give details to the Secretary of State because it came in just today, but that just proves to me that HS2 still cannot keep its commitments or treat the people who are being affected by the project in a rational, decent and respectful manner. It is a gross miscarriage of justice for people to be treated in such a way by the Government and by HS2 Ltd.
Michael Fabricant
Like me, my right hon. Friend has gone through the phase 1 experience—I am, of course, affected by phase 2a as well. Does she not think that HS2 as an organisation is dysfunctional? One official does not speak to another, the left hand does not know what the right hand is doing; surely that does not augur well for the construction of a railway line.
Dame Cheryl Gillan
My hon. Friend is absolutely right. A project of this nature needs to be run in the most professional fashion possible. It needs good governance. It does not need its top executives to be paid 10 times what an MP is paid. It has been criticised up hill and down dale. We have seen it handing out £1.7 million of unauthorised redundancy payments. We have seen the conflicts of interest that have caused major companies to pull out of the bidding process and the contractual process, the failure to carry out due diligence, a turnover of staff, and an attitude towards the people they deal with that can only be described as arrogant.
I still hope that this project can be pulled back into shape. That is why I encourage my colleagues to think about dedicating the Minister’s career over at least the next two years solely to looking after HS2. I thought long and hard, and I have the freedom of the Back Benches, which is a great pleasure, and it is with a heavy heart that once again I have to say that although I know that my hon. Friends will not press their amendment to a vote, if anyone does call a vote on Second Reading, I will again be forced to walk through the Lobby against it.
Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)
It is an honour to follow the right hon. Member for Chesham and Amersham (Dame Cheryl Gillan). I too welcome the Minister to her post and wish her very well.
In the UK, we are rightly proud of our status as the birthplace of the railways. However, our rail infrastructure —much of it from the Victorian era—requires significant investment if it is to continue to serve the people of Britain in the 21st century. In our 2017 manifesto, Labour promised to create a national transformation fund to invest some £250 billion over 10 years, and we remain firmly committed to investing in our nation’s infrastructure.
HS2 represents one of the largest infrastructure projects in Europe. The scheme will provide much needed capacity to support future demand for rail services, and it aims to deliver wider economic benefits to the regions that it serves and beyond. Although very few would argue against those goals, it is crucial that the project is conducted in the right way: by providing jobs and opportunities to our young people, minimising the disruption caused to our communities and protecting our precious environment.
Although I support the HS2 project in principle, I think it is important to focus on a number of issues. London’s economic output is more than double the rest of the UK average. For the country as a whole to prosper, the balance needs to be redressed, not to the detriment of Londoners but for the benefit of all. According to Government figures, when HS2 is fully completed, it will deliver a benefit-cost ratio of 2.3 when wider economic impacts are included. I want to make sure that those benefits are shared by as wide a group as possible, and especially the areas that are directly affected by the construction of the line. Billions of pounds of taxpayers’ money is being spent on this project; that money must benefit more than just the shareholders of a handful of large companies.
Both the Birmingham chamber of commerce in my constituency and the Greater Birmingham and Solihull local enterprise partnership support HS2, recognising the economic benefits that better connectivity will bring. I want Birmingham’s economic output to continue to grow, its people to find well paid, secure and skilled jobs, and the city’s potential to be further recognised as a result of the project. I want to see the construction of HS2 ignite greater interest in engineering among our young people, and apprenticeships to be made available to all young people in our communities, whatever their background.
Rachel Maclean
I completely agree with the hon. Lady about the benefits and how they should be spread across Birmingham and the region. Does she also agree that this is a great opportunity to capture the talents of women, particularly in engineering, in this Year of Engineering?
Preet Kaur Gill
I absolutely agree; we need to see more women coming into engineering.
However, one of my concerns is that the recent fiasco surrounding the east coast main line franchise, combined with the demonstrable success achieved after the last private sector rail bail-out by Directly Operated Railways, serves only to highlight the need for public ownership of our railways. At a time when living standards are squeezed, wage rises are not keeping pace with the cost of living, and rail passengers have just had to endure the largest fare rises in five years, it is not acceptable for private companies to table inflated offers for these vital services, extract the profits, and then simply walk without honouring their commitments.
Finally, this project should not come at the expense of our environment either. In future, when our children are using HS2, I want them to benefit from the cleaner air that the increased use of rail will bring, but I do not want the construction of the tracks that they are travelling on to have caused untold damage to the environment. Organisations such as the Wildlife Trusts have raised concerns about the loss of ancient woodland, sights of special scientific interest and nature reserves. The construction of HS2 should serve as an example of how large-scale infrastructure projects can be conducted in an environmentally friendly way—changing the environment, yes, but not destroying it. This is an opportunity to achieve a net gain for nature.
The sums of money involved are too great and the potential impact on communities too large to get this project wrong. That is why the Government need to ensure that the process is as transparent, cost-effective and environmentally friendly as possible, so that HS2 delivers for the many, not the few.
Jack Brereton (Stoke-on-Trent South) (Con)
As an enthusiastic supporter of improvements to our rail network, I welcome the principle behind the Bill—establishing a high-speed railway beyond Birmingham—but I have some concerns, so I welcome this opportunity to set out how I think the Bill could be improved, particularly for the ambitious and growing city of Stoke-on-Trent.
My right hon. Friend the Secretary of State, as a recent and welcome visitor to my constituency, will know exactly how ambitious we are. The scale of the local rail improvements we are seeking and planning for are, like HS2 itself, unmatched since the Victorian era. We are keen to embrace the many opportunities arising from HS2. HS2 is going to happen—that is no longer the debate; phase 1 preparations are already under way, and the actual building of phase 1 begins next year. Time is marching on. The section we are debating in the Bill, phase 2a, is due to open to passengers by 2027—the end of the next Parliament. We must get on with the Bill, or it will not be long before we are living with the consequences of getting it wrong.
The principle of a high-speed railway line from the west midlands conurbation to Crewe is sound—releasing capacity for passengers and freight services on the existing network, while cutting the fast times to Crewe from London to under an hour—and in principle I welcome it, but for the social and economic benefits of HS2 to be maximised in practice, there needs to be much better integration, as many hon. Members have mentioned. Improvements to infrastructure on the existing network around Stoke-on-Trent, as well as local rail improvements for connecting trains from Crewe, including the Crewe to Derby line, which serves Longton in my constituency, are vital.
The Secretary of State joined me on that service earlier this month and has seen at first hand the improvements needed on it. I welcome the much-needed investment in our local transport infrastructure that he proposed when he visited, but there is much left to be resolved around how the benefits of HS2 will be delivered in and for Stoke-on-Trent. As the briefing note that the public affairs department of HS2 Ltd kindly sent to MPs for this debate puts it:
“Detailed work and consultation is currently being undertaken on options for the development of the HS2 Crewe Hub, with the potential for a HS2 service at Stoke.”
That is a tantalising, and potentially a very lucrative, assurance for the city.
There is clearly a need for Stoke-on-Trent to be connected—it is fundamental to HS2 being of maximum benefit to my constituency. We are told by HS2 Ltd that the Bill “could” mean better commuter services and the potential for extra freight trains, and we are assured by the Rail Delivery Group that it “will” add much-needed space for more and faster trains. I say that it “must” deliver these benefits. To do that, the Government need to be clear that a viable option for the Stoke connector, as promoted by Stoke-on-Trent City Council, is firmly on the table, to ensure that the infrastructure around Stoke-on-Trent receives the vital upgrades it needs.
This would mean getting, in addition to the proposed Handsacre link, which is appropriate for Stafford, a low-impact five-mile line designed to take classic compatible HS2 trains from the main HS2 line through the very significant Stoke-on-Trent catchment and on to the rest of east Cheshire, Macclesfield and Stockport. Such a dedicated Stoke connector would provide the necessary link to improve connectivity and boost capacity. It would do so by getting around the bottleneck that will otherwise remain on the west coast main line to the south of Stoke-on-Trent. That is the way to maximise the full opportunities for more housing and jobs, and I will continue to pursue this matter as the Bill progresses.
It is also imperative that Stoke-on-Trent continue to enjoy regular fast train services to and from London—at least one service every half hour or more frequently. HS2 compatibility should offer my constituents improved journey times as well as helping us to maximise both housing and commercial development in the city, fully seizing the economic opportunities that Stoke-on-Trent offers.
It is essential to address the lack of fast, direct services between Stoke-on-Trent and Birmingham, to match the good quality of the services currently offered between Stoke-on-Trent and Manchester. Through the Bill, HS2 has the potential to address the severe overcrowding and poor connectivity that are currently experienced between Stoke-on-Trent and Birmingham. There is also the potential to improve connectivity further by providing the direct intercity services that are currently lacking between locations such as Stoke-on-Trent and Liverpool. That would fully exploit the potential for economic growth from the midlands engine and northern powerhouse initiatives, with Stoke-on-Trent as the gateway to the north.
As well as improving services, it is essential to do more to improve both the capacity and the offer at Stoke-on-Trent railway station. Although it is the main station serving the potteries conurbation, which consists of more than half a million people, it currently has limited platform and concourse capacity, as well as poor-quality retail facilities. Again, Stoke-on-Trent City Council has stepped forward with detailed proposals. The Stoke-on-Trent HS2 master plan sets out the ambition to transform the station, vastly improving capacity and facilities, and leveraging significant redevelopment in the wider area on the back of those improvements. It is important for those proposals to be realised if we are to ensure that the station is HS2-ready and playing a full part in the city’s regeneration.
I fully support the principle of the Bill, and it will receive my support tonight. I am a positive and enthusiastic supporter of improvements in our rail industry, and I am keen for us to finally emerge from the legacy of the disastrous erosion of Stoke-on-Trent’s rail network that we saw under nationalisation. I know that the Secretary of State is equally committed to large-scale improvements, and I thank him for the commitment to invest in our local transport infrastructure that he gave during his recent visit to my constituency; it was hugely welcome. However, I take very seriously the need to improve infrastructure interconnectivity, and further work needs to be done on that. I also take very seriously the opportunities promised by the Department for Transport and HS2 Ltd, which have said that detailed proposals will continue to be refined for HS2 as the Bill progresses. I look forward to playing my part in that process to the full.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
It is a pleasure to follow my constituency neighbour, the hon. Member for Stoke-on-Trent South (Jack Brereton), in this important debate. I disagree with him about the support that should be offered to the Bill this evening. The principle behind a high-speed rail network is absolutely fine, but the Bill should actually be entitled the devastation of Staffordshire Bill. It will lay an iron scar across our county, and it will bring very little in the way of economic benefits. All that it does is seek to take all the potential benefits and, through a bottleneck, funnel them down to London and the south-east, where there will be no benefit for my constituents or those of the hon. Gentleman.
I find myself in what some might describe as the invidious, or perhaps I should say unusual, position of agreeing with the hon. Members for Lichfield (Michael Fabricant), for Stone (Sir William Cash) and for Stafford (Jeremy Lefroy)—the holy triumvirate of Staffordshire Members when it comes to matters of logistics—who have drawn attention to the fallacies in the Bill. Like the hon. Member for Stafford, I have no problem in principle with high-speed rail. I have no problem with the idea of providing additional capacity for the west coast main line and an opportunity for new rail networks to come through Staffordshire and service his constituency and mine. What the Bill does not do, however, is match that aspiration with reality.
The hon. Gentleman has already pointed out that the services that will be coming north from London through our constituencies will terminate at Macclesfield. If we were serious about how we could provide better economic benefits for Staffordshire, the line would go all the way to Manchester. Crucially, that would also offer a new opportunity for a direct service from Stoke-on-Trent to Manchester airport. That would provide a huge growth opportunity for business and tourism, and it is supported by Staffordshire chambers of commerce, which has done so much to promote the venture. It would not necessarily involve a high-speed link, but it would involve the wider issue of funding the regeneration of rail networks out of Stoke-on-Trent. We must not focus purely on high-speed rail enabling us to get to and from London quicker than we currently can. The purpose here is interconnectivity of the regions going north as well, and what we are being offered in this Bill does not provide any sort of hope for that.
I want to look at what I consider to be a mismatch in Government policy. The Secretary of State for Business, Energy and Industrial Strategy highlights the potential benefit of a ceramic deal in Stoke-on-Trent, and the fact that Stafford is a growth point in our county and that we could have new jobs and regeneration and place-based economic growth through a potential ceramic park bordering my constituency and in the constituency of the hon. Member for Stoke-on-Trent South. Yet although we are told that a place-based industrial strategy is important, we are also told that Stoke-on-Trent station, which has 2.8 million rail users a year, is not worthy of anything other than a single one-hour service that will only go north to Macclesfield and will terminate in London, when the journey time of the current service to London is adequate and capacity on the Virgin line is not too much of a problem.
The bigger capacity issue in Stoke-on-Trent and north Staffordshire involves the line run by CrossCountry that services Stafford, Wolverhampton and Birmingham and Birmingham International, where it is often standing-room only in some of the most unpleasant circumstances we can imagine. Yet while we are talking about trying to bring Government policy on regeneration strategy together, there is no economic benefit not to having a greater presence in Stoke-on-Trent.
There is the issue of where the services coming north go to. The hon. Member for Lichfield rightly pointed out that there are potential benefits in using existing railheads, and I was glad to hear the hon. Member for Stoke-on-Trent South endorse the work done by Councillors Mohammed Pervez and Andy Platt on the Stoke option, which sought to use the existing rail infrastructure in Staffordshire to take high-speed trains north. The estimate done by the city council at that time suggested that that system could be delivered seven years quicker than the previous timescale and at £5 billion less.
We have here a system that does not necessarily deliver economic benefits for the people of Staffordshire, and it certainly does not help address the ecological issues raised by the hon. Members for Stafford, for Stone and for Lichfield, nor does it provide any great comfort that the northern powerhouse and the midlands engine will be properly connected.
The hon. Member for Lichfield stole most of the things I wanted to say, and he made the point that this is meant to be about connectivity but it really is not. Connectivity does not mean having to traipse across London to make a change, and it does not mean having to change stations outside Birmingham—and Birmingham Curzon Street to Birmingham New Street is quite a long walk for those carrying a bag or if there are a lot of people in the town centre that day.
The system does not address the east-west connectivity of Stoke-on-Trent, which is a greater issue. It does not look at the route that goes from north Wales all the way through to Derby. It does not seek to change the single-carriage railway we currently have that is often over-subscribed. It does not seek to deal with the fact that parts of the M6 are still not in the managed motorways system, so we drive north on the M6 and hit junction 13 and all of a sudden we drop down to three lanes and the traffic is a bit gnarly and not particularly flowing well, and then we reach junction 17 and all is fine again. That is part of the connectivity that we need.
The system certainly does not recognise the fact that junction 15 of the M6 is one of the worst junctions to navigate of all time. I have sometimes had to wait longer there to get on to the M6 than it has taken me to get to Birmingham once on the M6, simply because of the way that junction works. So if we are talking about connectivity and there being a need for greater integration of transport provision, we must look at that as well as looking at high-speed rail.
The Secretary of State is not in his place at present, but the new Minister is and I welcome her to her role. Can we get some clear and categorical commitments that the existing Virgin service that we have from Stoke-on-Trent will not be diminished? Every time we ask that question, we get a slightly different answer; we get some sort of, “Yes, but, maybe, if,” but those terms do not fill us with confidence that any options that come out of the Crewe hub will not lead to a reduction overall in rail service from Stoke-on-Trent. If we include journeys from the constituency of the hon. Member for Stafford, we find that 5 million rail journeys are conducted out of Staffordshire every year. That is a large number of people, and they deserve to know what the future of their rail service will look like.
I would be grateful to the Minister if she gave greater consideration to ensuring that trains going north go past Macclesfield. There is a genuine economic boom to be harnessed in north Staffordshire and south Cheshire if we can have a proper high-speed rail link to Manchester and Manchester airport. That is a proposal that the local chambers of commerce have been putting together. I would welcome any words from her or her colleagues in the Department for Transport about the managed motorways system on the M6. We need to take a holistic approach if we are to make north Staffordshire and south Cheshire a good place to do business, deliver economic regeneration and, most importantly for my constituents, provide the rail service that they need. I support the principle of the Bill, but I cannot support its content, and if there is a Division on it, I am afraid that I will not offer my support to the Government this evening.
Rachel Maclean (Redditch) (Con)
I am grateful for the opportunity to speak in this important debate, and I commit my support for the Bill’s Second Reading. I have listened with interest to the entire debate, and I want to thank all those Members who have talked about the changes that need to be made. As a former resident of Birmingham, and someone who now lives close to it, I endorse what colleagues have said about connectivity across that city. I very much hope that the issues can be addressed in the final plans. We have heard arguments about how long it takes to walk between Birmingham New Street and Birmingham Curzon Street. My hon. Friend the Member for Lichfield (Michael Fabricant) is obviously a very speedy walker; other Members walk more slowly. If that route could be joined up, it would be beneficial for everyone who passes through what is one of our nation’s great cities.
I want to touch on the question of productivity, which is a key theme in the debate and links closely with what we are trying to achieve with transport infrastructure in this country. This is the main reason why I am supporting the Bill tonight. The Government brought forward many measures in the industrial strategy to boost productivity across the country. That is really important to all of us who live outside London and the south-east. We all acknowledge that wealth, jobs and productivity are not spread evenly across our country, and one of the major things that we can do to address that is to build a decent high-speed train service that will enable our constituents, wherever they live, to travel up and down the country to access jobs and opportunities. The Government are making a fantastic commitment to this project, which underpins their mission to spread wealth and growth across the country.
Michelle Donelan
Is my hon. Friend aware that this is the biggest infrastructure project in Europe?
Rachel Maclean
I thank my hon. Friend for that intervention, because she reminds me of the significant amount—about £100 billion, I think—that Governments, including the previous Labour Government, have put forward. We have not built any new railways in this country since Victorian times, so it is really important that we are committing this funding now and in the future to build our railways. The project will be important to our constituents’ quest to travel not only from London to the midlands, but from the midlands up to the north. It will also help our quest to take pressure off the overheated south.
Maggie Throup
My hon. Friend makes a very good argument. Does she agree that this is not just about freeing up the lines to the south, because there will be help for lines to some of the smaller stations where services do not stop at the moment? This is not just about people who want to travel from city to city; it is also about travel between towns.
Rachel Maclean
I thank my hon. Friend for her intervention. I am sure that many of her constituents, like mine, have to travel to the nearest big city or town to get to work or leisure destinations. The project will help to free up capacity on those secondary lines.
The project will make an important contribution to our global competitiveness as a nation. Thanks to the Government’s economic programme and their management of the economy, the UK is seen as a highly attractive destination for business investment. I want to see that continue. When foreign investors look at our country, they consider the transport links, because they want to invest in places from where it is easy to get around the country so that people will find their businesses attractive and want to work for them.
HS2 will benefit not only my constituents in Redditch, but the country as a whole. Although we will not benefit directly from HS2, we live only a short distance away from Birmingham, which will be a major stop on the line. Many of my constituents work, play and socialise in Birmingham, and the economic prospects of a place such as Redditch are intertwined with those of Birmingham and the larger west midlands conurbation. When the project is completed, we will see benefits for business and residents, and transport routes up and down the country will be opened up.
Michelle Donelan
Does my hon. Friend share my passion for the National College for High Speed Rail? It will not only help to fill the skills gap for high-speed rail, but train people so that we deal with the long-term skills gap in the engineering, design, technology and construction sectors.
Rachel Maclean
My hon. Friend is a great champion of engineering and I have been inspired by what she has done in her constituency. HS2 will definitely provide a boost for engineering careers. The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) rightly said that we do not mention careers for women in engineering enough, and I want to go at least some way towards rectifying that. I hope that the National College for High Speed Rail will have a mission to bring more women into engineering so that this project provides a boost to help to address the dire lack of women in engineering and construction, particularly given that it is the Year of Engineering and also 100 years since women got the vote. There are many reasons to focus on that issue and ensure that we get things right.
Maggie Throup
We need engineers to construct the line, but we need them in the supply chain, too. Bombardier’s base is close to my constituency, and I have met the female apprentice engineers who build the underground trains that we travel on every day. That is just one example of how much more we can do to spread the word that engineering is for men and women.
Rachel Maclean
My hon. Friend makes an extremely good point. We can all encourage employers to be role models and women to speak out. Businesses that value such careers should pay people decent salaries so that they do not all go off to work in the City. That is what this country needs. We need a dynamic economy that works for everyone.
Mr John Hayes (South Holland and The Deepings) (Con)
I was until recently the Minister for the Year of Engineering, and I looked at the possibility of establishing an advisory group to examine exactly the issue my hon. Friend describes: how groups that are under-represented in engineering can get a foothold and, beyond that, a greater share of the opportunities. I wonder whether the current Minister will take that up and perhaps establish such a group, which would be in the spirit of what my hon. Friend suggests.
Rachel Maclean
I thank my right hon. Friend for his work. He is a champion of women not only in engineering, but in all other spheres, and I hope that the Minister will take up that suggestion.
Redditch’s small businesses are hoping to take advantage of some of the contracts that are being awarded through HS2, both now and in the future. For example, Arrowvale Electronics makes world-leading equipment and hopes to benefit from the boost that an HS2 contract would provide. I know how hard it is for small businesses to tender for large-scale Government contracts, so I urge the Minister to say what she is doing to ensure that they can get a slice of the pie and benefit the diverse economy that we all want.
Gareth Snell
The hon. Lady makes the apt and correct argument that there ought to be opportunities for small and medium-sized enterprises to get government contracts. What I fail to see is the logic behind her support for both this Bill and that argument, because if there were other projects to deal with regional rail inequalities and road upgrades—other large infrastructure projects that were not HS2—such opportunities would still exist.
Rachel Maclean
I thank the hon. Gentleman for his question. I confess that I am not sure that I entirely followed its logic, but I think I get the point he is trying to make. There will be opportunities for small businesses, even if not directly—I am thinking of first contractors and even the supply chain further down, because many of these contracts involve a multitude of contractors. It is important that the Government look at this area, as I am sure that the Minister will. There will be a benefit for people and businesses in my constituency, and we hope there will be a particular benefit for women. Although the HS2 college is located in Birmingham, I hope that it will see what it can do to spread its opportunities for training beyond Birmingham city centre.
I have mentioned the process of contracting already, but I wish to touch on it again briefly. I am a member of the Select Committee on Business, Energy and Industrial Strategy, and just this morning we held our joint inquiry with the Select Committee on Work and Pensions on the collapse of Carillion. We have questioned the regulators and we will shortly be questioning the Carillion directors. Clearly, there are many lessons to learn from this collapse, which has affected many businesses and people, including those with pensions. I very much hope that when the Government award contracts for HS2, they will learn those lessons quickly so that we do not see the sorts of decisions that enabled companies such as Carillion to continue operating in a way that put pensions and small businesses at risk. I very much hope that the Minister will address those concerns, which I am sure we all have.
If this project is done right, we have an opportunity to do contracting right, and to boost not only small businesses but larger businesses up and down the country, providing opportunities for people to gain new skills. I am talking about apprenticeships, and getting more women in engineering and new sectors such as the rail industry. Such sectors might not have been traditionally attractive for people to consider, so let us make careers in them something to which young people aspire, so that we are going forward with the jobs of the future.
Michelle Donelan
Does my hon. Friend agree that one area that has been neglected in today’s debate is the social and wellbeing aspect that the project can bring to people? We talk often in this place about loneliness and boosting tourism around the country, and improving our connectivity in the UK is an example of how we can achieve that.
Rachel Maclean
My hon. Friend makes an extremely perceptive point and I completely agree with it. My hon. Friend the Member for Isle of Wight (Mr Seely) was talking about the investment figures, and sometimes there are intangible benefits that are not always captured in an economic forecast. I hope that the Government are looking at that and looking at how we can maximise what my hon. Friend the Member for Chippenham (Michelle Donelan) describes. Loneliness is a real scourge and when people who live in London can get on a train and go to Birmingham, or vice-versa, and people can to go from Birmingham to the north, they can explore new parts of our beautiful country. We can also reduce the carbon footprint that would come from their getting on an airplane. Let us have more staycations. Let us explore our country, because we are blessed in our island nation with some of the most beautiful landscapes. Sometimes that tourism benefit is lacking from our debate. How much better it would be if we could encourage holidays at home and boost the tourism—
Mr Deputy Speaker (Sir Lindsay Hoyle)
Order. I am trying to have the debate at least somewhere in scope, and I am sure the hon. Lady wants to get back on track —excuse the pun.
Rachel Maclean
Thank you, Mr Deputy Speaker. I apologise for deviating a tiny bit off the track.
As my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin) said in his extremely eloquent speech, it is impossible to build a major infra- structure project in any country without it having some impact on people, but we have to make sure that it is managed sensitively, that people are treated well and that their voices and concerns are heard. I hope that the Government reassure us that that will be done properly.
Infrastructure underpins our productivity. There is a strong push in our country towards devolution, and investment in high-speed rail is critical to that. Will the Minister say how this project will link to the devolved combined authorities agenda? I am close to the West Midlands combined authority—Redditch is a constituent member—where the Mayor holds powers over transport. It is important that HS2 links to transport in the mayors’ regions so that we have an integrated solution to local transport issues. I have campaigned vigorously for better links between Birmingham and my town of Redditch, and I shall continue to do so. I hope that we see a push on that as capacity is freed up when the express trains leave the lines, thereby freeing up more scope for faster and better express services from secondary hubs into the main cities.
We in the west midlands are leading on jobs and growth. We have a booming economy. We are creating more jobs and more businesses are starting in our area than in any other part of the country. Redditch is on the edge of that, but we benefit from it and we want to harness it. We want our region to take control of our own destiny, as do, I am sure, colleagues from across the country. This high-speed rail project and other infrastructure projects will enable us to take charge of our own destiny and live our own lives and will encourage prosperity for all our constituents.
Andrew Jones (Harrogate and Knaresborough) (Con)
I rise to speak in support of the Bill. It is positive that we are debating it and I very much enjoyed playing a role in its development.
As my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin) said, passenger numbers on our railways have grown from just over 700 million to nearly 1.6 billion. That is a fantastic turnaround for an industry that had seen decades of decline. The industry now faces the challenge of how to cater for the growth it is experiencing. It is a completely different mindset, so it is positive that we are seeking finally to bite the bullet and construct some new capacity in the UK rail network. We have deferred this decision for far too long. Things such as small upgrades to reduce pinch points and thereby increase capacity have only deferred the big decisions. If we consider the fact that we have not built a new railway line in England north of London since the reign of Queen Victoria, we realise just how overdue HS2 is.
Ben Bradley (Mansfield) (Con)
Does my hon. Friend agree that part of the reason why we now face a capacity issue and need to deliver HS2 is that the frailties of the nationalised rail service caused the shutdown of so much of the capacity throughout the country?
Andrew Jones
My hon. Friend makes an insightful point. We had decades of decline when the rail industry was in public hands. The turnaround post-privatisation has been dramatic. Opposition Members take that for granted and suggest that nationalisation is a way forward, but they have forgotten the complete change we saw, with the focus on customers and growth, and how that has delivered and been a key part of the UK’s economic growth.
Christian Matheson
Will the hon. Gentleman not concede that that turnaround has taken place on the back of several hundred million pounds of public money being given to the train operators every year?
Andrew Jones
Well, the hon. Gentleman suggests that even more public money should go in, so I am not sure where his argument takes him, apart from round in a circle. We are seeing long-overdue public investment in the rail industry.
Sir Patrick McLoughlin
We do not want to spend too much time on this issue, but the simple fact is that in the past, when the nationalised railway had to rely solely on the Government, the Government cut off its funding. With privatisation, it has attracted funding. The truth of the matter is that that has seen growth in the rail industry that has made something like HS2 absolutely necessary.
Andrew Jones
My right hon. Friend is as wise as ever. Not only do we have public money going into our railways, but we are seeing private investment attracted into our railways and therefore more investment in aggregate. We have this urgent need for capacity within our network to cater for the growth both in passengers and in freight.
After years of decline, this decision has been taken to go for growth. The next question that successive Governments have faced is what form that should take. Should it be investment in the classic rail network, or should we be embracing new technology? Well, we should of course be embracing new technology. Perhaps it is again worth remembering that that has not always been the case under nationalised industries. The UK built its last steam engine in 1960, and it was only in 1964 that the Japanese introduced the bullet train. The Government are buying investment not in phone boxes, but in fibre broadband. Technology should of course be at the heart of our investment decisions.
Gareth Snell
I thank the hon. Gentleman for giving way; he is being generous. I do not disagree with his arguments about the need for infrastructure investment or the need for additional capacity, but this Bill in particular is about the route between the west midlands and Crewe. The route that has been chosen is the most expensive that it could be, delivering the least economic benefits for Staffordshire and causing the most ecological damage. That is what we should be discussing this evening.
Andrew Jones
That has been part of the discussion throughout the day. I have to say that I missed some of the speeches. I am sorry to hear what the hon. Gentleman had to say, but I simply do not agree with his basic premise. I have travelled the route, met local communities along the route and met local government leaders and local businesses along the route. I simply do not agree with his premise.
The issues raised by colleagues along the line of the route are of course entirely fair and legitimate, and they are right to speak up for their constituents. It is difficult delivering infrastructure—whether it is transport, digital or housing infrastructure—without causing some environmental impact. It is clearly right for the Minister to listen to the concerns raised by Members and to respond appropriately. I know that when I was part of the Transport team, we did nothing but listen and try to address those issues. I know that the Under-Secretary of State for Transport, my hon. Friend the Member for Wealden (Ms Ghani), will be in the same grain.
Despite all the sensitivities that have been raised, it is very encouraging that we have a Government who are seeking to deliver HS2 as fast as possible and have brought forward HS2 phase 2a. Views have been well articulated today. The reasons why I am so supportive of the development are that it will deliver key strategic benefits for the UK in terms of economic growth and the skills legacy. I have visited the two HS2 colleges in Doncaster and in Birmingham—only during their construction phase; not since they have progressed further —and I was incredibly impressed by what I saw. They offer great facilities for skills development for people taking apprenticeships. They will learn all the skills that we will need not just for this project, but for future high-speed rail projects.
Rachel Maclean
I hope the House will forgive me for raising this issue again, but because he has visited the college and I have not done so, will he tell me what progress he saw on the initiative for getting more women into the train and engineering industry while he was there?
Andrew Jones
My hon. Friend makes a very interesting point. It was reasonably hard to see that from the project in development, but the teams I met working in the colleges were absolutely clear that they will be drawing on as much talent as possible, which will obviously mean bringing more women into engineering. We have a huge shortfall in the number of engineers in the UK. Historically, we have failed to draw on as wide a talent base as possible. The more we talk about the matter in this place, the more we follow it through within communities, and the more we offer a series of careers that can deliver high-quality jobs that solve community problems, the more women we will attract into the industry.
Mr John Hayes
Cutting-edge strategic decisions always bring with them a certain degree of contention, which is why Governments in democratic polities too rarely make such decisions. They also bring with them opportunity. One thinks of Crossrail. At the beginning, there were doubters, but Crossrail has, without doubt, led to the development of skills of the kind my hon. Friend described, the creation of opportunities, and the seeding of jobs, which have led to us being world beating. The same thing can happen in respect of HS2.
Andrew Jones
My right hon. Friend makes an interesting point. I entirely agree with him. For those who have not yet had the opportunity to go to see Crossrail, the opportunity may well occur again as Crossrail has been taking people down to have a look at its sites. What Crossrail has achieved is fantastic. I hope that my hon. Friend the Member for Redditch will shortly be able to visit one of the HS2 colleges, where she will see just the difference that the project has made.
Dame Cheryl Gillan
I would just say in response to the previous intervention that there would have been far fewer problems had the tunnel gone the entire way under the Chilterns. It would have been advisable to do that. Does my hon. Friend agree that there is a real danger that we will not have the engineering capacity to complete these projects on budget and on time, and that, as we currently lack so many skills in engineering, it will be hard to make up that deficit?
Andrew Jones
My right hon. Friend makes two points. We have previously discussed the issue of tunnelling in the Chilterns. I feel more optimistic about the project as a whole. I do not feel that the current skills gap will hinder the delivery of the project, and I am clear that that will not happen because of the actions taken to bring more people into the sector. The fact that we have to deliver skills via building colleges suggests that the Government have been taking seriously the issue of skills in the railways.
The key reason that phase 2a is such a positive project is that more people will benefit from HS2. Crewe is a rail hub. More passengers will be able to access the benefits that the HS2 network will deliver. I want us to go forward to further develop high-speed rail in other parts of the UK. I am particularly thinking about Northern Powerhouse Rail across the Pennines. I look forward very much to seeing the progress of the Bill and the rail line that will come from it, and how the Government will work with local communities and local government to maximise the opportunities that this line presents.
The HS2 argument has changed from whether we should have it, to how we can maximise the opportunities when it arrives. Those opportunities will be commercial, environmental and in skills. I see huge opportunity throughout the project, which is why I will support the Bill should we divide on it this evening.
Rachael Maskell (York Central) (Lab/Co-op)
I have listened carefully to today’s debate and thank all hon. Members for their contributions. I have heard the concerns and opportunities that the second phase of HS2 will bring. The high-speed rail journey began under the last Labour Government, who recognised the need for greater capacity and better connectivity.
The Victorian rail network has served us well, but nearly 200 years on it is overstretched. If we are to see a significant modal shift in the future—as Labour encourages—and if we want to see rail as the vehicle of choice for distance travel, we cannot stand back and do nothing, nor should we. It was from the Victorian age that our nation witnessed the foresight of a new generation of engineers to radically advance our country and the world. Yet today our trains are slow, crowded, and depend on outdated technology and infrastructure. It is therefore vital that, as a nation, we put ourselves in the driving seat again, strive to be world leaders and propagate the next generation of engineers, with both women and men taking on new careers in the sector.
Sir William Cash
Does the hon. Lady agree that it was not only the engineers of the Victorian age—great as they were—but also the capital that was provided which ensured that these schemes were actually put into effect?
Rachael Maskell
We could spend a long time talking about the shenanigans that also took place in this House over the creation of the Victorian railways.
Future capacity is vital. Although longer trains, digital signalling and infrastructure upgrades connecting with new rolling stock may get us through the current period, we will need more lines if we are to look further ahead. If we are to develop more lines, it is right that we seriously consider where they go.
HS2 gives us a real opportunity to think about the future of our country and how we connect it to address the unacceptable levels of inequality across Britain. HS2 is not just about the route itself but about freeing up capacity on the west coast main line and on our roads. This will bring benefit to current road and rail users, as well as creating new opportunities for further development of passenger and, importantly, freight paths on the west coast, as my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman) highlighted and my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) asked for.
Of course, Labour would, as always, be looking at the bigger picture, embedding HS2 at the heart of a wider rail and transport strategy. It would be absolutely nonsensical to make such significant investment in a new rail line if we were not properly upgrading the north-west to north-east routes—the HS3 routes. The Secretary of State is not in his place at the moment, but I hope that he will take heed of this. It is not too late to reverse his decision to de-electrify the plans and put power back into the northern powerhouse. The cities in the north demand it. We believe that HS2, integrated with a new, dynamic rail plan, must bring economic investment to the midlands and the north, creating good jobs for a secure future, not least with the new skills required in designing and constructing HS2 through the 30,000 jobs it will create.
My hon. Friend the Member for Crewe and Nantwich (Laura Smith) eloquently set out a strong economic case for proper connectivity through a regional rail hub at Crewe, this being at the centre of a network to feed Cheshire and the wider counties, and north Wales. That is vital for the future economy of Crewe. I can think of no better politician than my hon. Friend to speak up for her town and to make that case.
We must remember that HS2 is not an entirety in itself but a bridge to enable economic growth and industrial investment. My hon. Friend the Member for City of Chester (Christian Matheson) made a similar point, again focusing on how to build the economies of the north-west by ensuring connectivity. It is vital that HS2 talks to the region, and we must dissect this in Committee to ensure that it does. I note his calling for the line to north Wales through Chester. We should not dismiss this opportunity for some of the communities in the UK who most need this infrastructure stimulus. My hon. Friend the Member for Leigh (Jo Platt) also stressed the need to focus on connectivity. A clear call for integration has been made—one that Labour will support.
Phase 2a is set to deliver nearly £4 billion of benefits over the 60-year appraisal period, with a cost-benefit ratio of 1:9 and wider economic impacts. This indicates upper-end medium value for money, but accelerating this phase will represent very high value for money. Around Crewe, we will see 40,000 new jobs and 7,000 homes, opening up the life chances that have not been seen in the area before and starting to address the complete economic imbalance that we have in our country. Extending this to the Constellation Partnership will deliver 100,000 new homes and 120,000 jobs—20,000 in the Cheshire science corridor alone, putting the UK on the international stage in terms of science and technology.
I assure the House that Labour will never stand in the way of providing such opportunities to communities that have been crying out for investment—a point powerfully made by my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill).
Jonathan Edwards
I take the point that the hon. Lady is making. However, the KPMG report that looked into the impact of HS2 on various economies across the British state indicated that south Wales would be absolutely hammered. Is the Labour party not at all concerned about the economy of south Wales?
Rachael Maskell
Of course we are deeply concerned about the economy of south Wales. That is why we electrified the line to south Wales that helped to boost the economy in that region, and also ensured that HS2 fed into north Wales, helping the whole of the Welsh economy to grow.
We have some concerns, and it is absolutely right that there is tight scrutiny of every part of the project, as my right hon. Friend the Member for Rother Valley (Sir Kevin Barron) highlighted. At a time when the economy continues to fail, not least in the north, Labour understands why people are questioning the economic benefit of spending £55.7 billion on a rail route. This 36-mile section will cost £3.5 billion. At a time when our public services are crying out for investment, it is right that critical questions are asked about the project. However, the benefits are also clear, and it cannot be an either/or. This is about getting the Government’s economic strategy right. We will make sure that every decision brings maximum inward investment, as the economic opportunity is already estimated to be £92 billion across HS2.
We hear the concerns about the environment. It is vital that real consideration is given in Committee to the impact of construction and of the final network on the environment. That cannot just be about mitigation elsewhere, and I will push for us to maximise this opportunity. I will also want to ensure in Committee that modern, advanced engineering is able to find answers to the many questions raised about the environment and how the habitats directive, no matter which side of Brexit we are on, is seen in its fullest sense.
The hon. Member for Stafford (Jeremy Lefroy), who spoke particularly well on behalf of his constituents, highlighted how important it is to ensure that his constituents’ concerns are picked up. I assure him that in Committee, we will listen carefully to the points he has to make. The right hon. Member for Chesham and Amersham (Dame Cheryl Gillan) spoke of her vast experience in dealing with HS2. It is really important that lessons are learned and that there is good communication, and we must certainly end corridor deals.
Sir William Cash
The hon. Lady just said that in Committee, we will do such and such. I think she may have misunderstood the nature of the procedure. It will be a hybrid Bill Select Committee, not a Committee of the House.
Rachael Maskell
I thank the hon. Gentleman, but I do understand the process. Petitions will be brought forward, and we will listen carefully to them.
Labour will want to ensure that all opportunities for cyclists and walkers are harnessed from the HS2 route. Not much has been said about that to date. Labour is committed to cleaning up our air and our environment by cleaning up on the actions of Government when it comes to transport. Labour believes that investment in public and, I must add, publicly owned transport—we are not going back to the past, but moving forward to the future—is the way forward to deliver a rail system fit for the 21st century.
The Parliamentary Under-Secretary of State for Transport (Ms Nusrat Ghani)
It is with great pleasure that I close the Second Reading debate. This is my first Bill, so there is no pressure; I will try to do it some justice.
HS2 presents a huge opportunity for the country as a whole. It is a major undertaking but an essential one. Throughout history, improving connectivity has led to innovation, economic advancement and increased productivity. HS2 is no different. This project is a significant long-term capital investment in the country’s infrastructure. It will deliver substantial economic growth and returns, creating the wealth we need to spend on all our priorities, whether those are health or education programmes.
We are ambitious for our country. My hon. Friend the Member for Redditch (Rachel Maclean) spoke about productivity, being ambitious and ensuring that we train engineers for the future. We are ambitious for all of our country and determined to leave no one behind. HS2 is what the Government are all about, as it will enable future generations to thrive.
HS2 is a significant investment, but it is also a necessary one, and it is important that we get it right. With that in mind, I would like to thank all right hon. and hon. Members for their contributions. There were 21 contributions in all, and I will do my best to respond to all of them.
HS2 has the potential to transform our rail network. As a brand-new line, it is the best option for creating more space on our busy railways. By freeing up space on the west coast main line between the west midlands and Crewe, phase 2a has the potential to deliver much-needed additional capacity on a constrained part of our network—reducing overcrowding and making journeys more reliable, creating the opportunity for more varied and frequent services across the region, and benefiting Nuneaton, Tamworth, Lichfield and Rugeley.
The benefits will spread well beyond the railway itself. Faster and easier travel will put more opportunities within reach of millions of people. HS2 will connect people to jobs, and businesses to suppliers. It will bring new investment, employment and regeneration to towns and cities up and down the country. HS2 has the potential to support hundreds of thousands of jobs, including 2,000 apprentices. Most importantly—this was mentioned by many Members—70% of jobs created by HS2 will be outside London. It will help to train a new generation of skilled workers, including through the National College for High Speed Rail.
Many Members—such as the hon. Member for Liverpool, Riverside (Mrs Ellman), my hon. Friend the Member for Redditch and the hon. Member for Birmingham, Edgbaston (Preet Kaur Gill)—spoke about investment in the north. The north of England, in particular, stands to benefit from HS2. This part of the route, between Birmingham and Crewe, has been brought forward by six years so that we can deliver more of the benefits of HS2 more quickly.
We want to transform journeys for passengers and create the capacity the north needs to flourish, and delivering HS2 is an essential part of that. We are already carrying out the biggest investment in the north of England for a generation, spending £13 billion on northern transport, which is the largest such amount in Government history. This is not about the north against the south. Investing in our rail network is a key part of the Government’s plan for a connected Britain, and we are committed to improving journeys for passengers throughout the country.
HS2 will bring benefits to cities across the north before the construction of phase 2. Phase 1 will reduce journey times towards, for example, Manchester, Liverpool and Glasgow, and will release capacity between Birmingham and London. By shifting long-distance services on to the brand-new railway, HS2 will release capacity on existing routes and provide options for new or additional local, cross-country, commuter and freight services in many areas.
Phase 2a, between the west midlands and Crewe, will further improve journey times and bring more benefits to the north. HS2 is a key component in the delivery of Northern Powerhouse Rail, our vision for significantly improving journey times and service frequency between major cities in the north of England. This is why we have announced £300 million of funding to future-proof HS2 to accommodate future junctions. With Transport for the North and Midlands Connect, we are developing a clear set of proposals for connections that would allow Northern Powerhouse Rail and Midland Connect services to use HS2.
Several Members have spoken about Crewe and Stoke, and I hope to be able to respond to some of their questions. The HS2 business case has always included a plan to run high-speed train services to Crewe, but I know there is a strong ambition to achieve even more. I visited Crewe just last week, and I was impressed by the enthusiasm and commitment of Cheshire East Council and the Constellation Partnership to make the most of the opportunities that HS2 will bring, including jobs and homes.
I agree with the hon. Member for Crewe and Nantwich (Laura Smith) that a Crewe hub would generate significant opportunities not only for Crewe itself, but for the surrounding region. My hon. Friend the Member for Stoke-on-Trent South (Jack Brereton) spoke very clearly in support of Stoke being served by HS2. As the Secretary of State set out in his opening speech, we are very clear about the important economic role that Stoke-on-Trent plays in the wider region, and we want it to be served by HS2.
Gareth Snell
Under the current plans, Stoke will be served by just one HS2 train an hour. Will the Minister consider upping that to two an hour to generate the economic benefit she has just committed herself to?
Ms Ghani
We are a long way from the timetables, but if the hon. Gentleman will let me continue for a moment, I will talk about how and when we will respond to the consultation undertaken on this very section.
We are looking at what would be needed for phase 2a to support a future Crewe hub, but as the hon. Member for Crewe and Nantwich is aware, Crewe is a strategically important location on the rail network and the existing infrastructure is very complex. In our plans for HS2, we must ensure that we get things right. That is why last year we launched a consultation to look at whether we can provide an even better service to Crewe—one that could serve more destinations and allow more trains to stop. We are considering the responses, and will respond shortly. Realising the full vision would need the local council to work with us on funding, and my Department is working closely with Cheshire East on this. Some elements could be taken forward by Network Rail, under its existing permitted development rights, and we understand the whole-hub vision would require a junction north of Crewe back on to HS2, but that has to be a decision for phase 2b, as we will not build the relevant part of the HS2 line north of Crewe in phase 2a.
Laura Smith
I am wondering whether we can get some clarity as to when we will get the answer to this consultation —not a “You will get it in due course” answer. We would quite like to know when that will be.
Ms Ghani
We are working through the details. We will try and do it as quickly as we can, but it will be shortly—this year. I am sorry; I cannot provide more details now, but I will write to the hon. Member and let her know. This is very complicated and cannot be rushed. We need to make the decisions for the right reasons.
Dame Cheryl Gillan
I welcome the passion with which the Minister is approaching her brief, but may I bring her back down to reality? The constituent I mentioned in my speech, who has been so badly affected by HS2 phase 1 and so badly let down by HS2 Ltd, which is not paying the bills it promised, and is contracted, to pay, is now on antidepressants and fears that this sort of thing is happening to many other people up and down the line. Could the Minister put some of her passion for the project into protecting the people who are so badly affected by the project?
Ms Ghani
My right hon. Friend has raised many issues about HS2 Ltd, its relationship with our constituents and its poor performance in communication previously, with the Secretary of State and with Ministers who have held my current position. I will indeed endeavour to hold HS2 Ltd to account. I am more than happy to take on board any cases that my right hon. Friend wishes to present to me, and I am grateful for her words in opening her speech. I will do my best to outlive previous Ministers in this position.
To turn to the hon. Member for City of Chester (Christian Matheson), the consultation on the Crewe hub that we published last year included service pattern options that will reap benefits for Chester, north and south Wales, Shrewsbury and the wider region. As I mentioned, we expect to respond to that consultation shortly.
Sir William Cash
I think I can say this on behalf of all those who are liable to petition in Staffordshire, thus representing several constituencies here: will the Minister do everything possible to help those petitioners to present their case, and show maximum understanding of what is affecting them, right the way through from one end of Staffordshire to the other?
Ms Ghani
My hon. Friend has been a great champion for his constituents and has made his concerns known to me, the Secretary of State and previous Ministers. The Committee is the best place for him to represent his constituents and encourage them to petition the Committee.
My right hon. Friend the Member for Chesham and Amersham (Dame Cheryl Gillan) raised an incident in Colne Valley. I expect HS2 Ltd and any contractors to treat everyone with respect. The reported behaviour that she mentioned is completely unacceptable and falls well below the standard that I would expect. I am happy to take up the case on her behalf.
The My hon. Friend the Member for Lichfield (Michael Fabricant) gave a very passionate speech, which I believe is now trending on YouTube, with his walk back and forth in the Chamber. I am not quite convinced about his journey times within Birmingham, and as a proud Brummie I would not mind spending eight or 22 minutes walking around Birmingham as I think it is a great place to be, but HS2 is connected to existing rail stations up and down the network, including Euston, Manchester, Crewe, Leeds and Sheffield.
My hon. Friend the Member for Erewash (Maggie Throup) raised a number of concerns. I know that she has spoken repeatedly to me, my predecessor and the Secretary of State, and that too she is a strong champion for her constituents. On Long Eaton, HS2 Ltd has had meetings with my hon. Friend, valuation agents and residents to try to progress this issue. HS2 Ltd is mindful that there are elderly and vulnerable residents involved, and these cases are getting very senior attention within HS2 Ltd to try to find a resolution. I do not doubt that my hon. Friend will continue to work with me to ensure that her constituents are satisfied with the responses that they get from HS2 Ltd.
Let me turn to the points raised by my hon. Friend the Member for Lichfield and others about ancient woodland. Of course, ancient woodland is irreplaceable, and although we cannot fully compensate for all impacts, we have committed to use best practice measures, such as enhancing links between woodland, reusing ancient woodland soils and creating new mixed deciduous woodland. More than 75 hectares of new woodland will be planted along the phase 2a scheme to partially compensate for the loss of 10.5 hectares of ancient woodland. It is unfortunate, but we are doing our very best to compensate for the woodland that is being taken.
I am unable to respond to many other Members’ comments, and I will endeavour to write to them all, but I want quickly to move on to the question of engagement. Many Members mentioned that HS2 Ltd has fallen short of expectations as to how it should communicate with Members as well as their constituents. I expect HS2 Ltd to reach extremely high standards in all its engagement activities, and I say to the House that I am sorry if in any of these cases the level of engagement has fallen short. I encourage any Members with particular concerns to meet me to discuss them. I will listen, and I will endeavour to hold HS2 Ltd to account. As a project, we will continue to learn and improve.
There have been a number of conversations about the cost of the project. To clarify, the 2015 spending review reconfirmed the Government’s commitment to HS2 and set a long-term funding envelope of £55.7 billion. The Government are determined, and are on course, to deliver HS2 within this. HS2 is a major investment but a necessary one. For every £1 of investment, it will deliver more than £2 of benefits. That is more than £92 billion of benefits to this country before we even talk about the 100,000 jobs, 70% of which are outside London.
I fear that I have run out of time, so I must come to a close. We have made the case for HS2 and we now need to get on and build it. This country invented the railways, and we should be proud of our Victorian pioneers, but we cannot continue to rely on the network that they built. Around the world, our global competitors are already investing heavily in high-speed rail. We are now catching up, and I do not want us to be part of a generation that sits back while others move forward. I was touched by what my right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin) said: when trains were first offered from Birmingham to London, people said that canals were adequate. Let us not be that generation.
Let us make no mistake: this country can deliver major infrastructure projects, and we should have confidence that we can deliver HS2. We have already delivered the 2012 Olympics and Crossrail—two examples of what we can achieve when we are ambitious, believe in our ability as a nation to get big infrastructure projects done, and commit to investing in our country and in our future. This Government have a vision for a stronger, fairer country within an economy that works for everyone. Infrastructure is at the heart of our industrial strategy and that for the north—for a modern country with a modern transport infrastructure to match. HS2 will play a vital role in this. I therefore commend this Bill, my first Bill, to the House.
Michael Fabricant
As I intend to vote against Second Reading, for all the reasons I have given, and as that has the same effect, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question put, That the Bill be now read a Second time.
Business Without Debate
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Madam Deputy Speaker (Dame Rosie Winterton)
With the leave of the House, we will take motions 11 to 14 together.
Motion made, and Question put forthwith (Standing Order No. 118(6)),
Rating and Valuation
That the Local Government Finance Act 1988 (Non-Domestic Rating Multipliers) (England) Order 2017, which was laid before this House on 20 December 2017, be approved.
Betting, Gambling and Lotteries
That the draft Gambling Act 2005 (Amendment of Schedule 6) Order, which was laid before this House on 14 December 2017, be approved.
Community Infrastructure Levy
That the draft Community Infrastructure Levy (Amendment) Regulations 2018, which were laid before this House on 13 December 2017, be approved.
Immigration
That the draft Transfer of Responsibility for Relevant Children (Extension to Wales, Scotland and Northern Ireland) Regulations 2017, which were laid before this House on 7 December 2017, be approved.—(Chris Heaton-Harris.)
Question agreed to.
Universal Credit Programme
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Helen Goodman (Bishop Auckland) (Lab)
The roll-out of universal credit continues to be a matter of concern in my constituency. Some of my constituents have been temporarily unable to pay their bills because of the long waiting period between one benefit and another, and the bailiffs were sent around. There is clear evidence of discrimination against women in the way in which the system works. People who have made national insurance contributions and lose their jobs do not get unemployment benefit as they used to on the basis of six months’ contributions if their husbands are in work. I am very grateful to Samantha Townsend, who has collected some 1,100 signatures.
The petition states:
The petition of residents of Bishop Auckland, Shildon, Spennymoor and Teesdale,
Declares that the Universal Credit programme is pushing people into poverty, debt and homelessness.
The petitioners therefore request that the House of Commons urges the Department for Work and Pensions to pause and fix Universal Credit before its rollout in Bishop Auckland, Shildon, Spennymoor and Teesdale.
And the petitioners remain, etc.
[P002096]
Lorry Parking
(6 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Helen Whately (Faversham and Mid Kent) (Con)
A few weeks ago, in the early hours of the morning, a car carrying four men crashed into a parked lorry on the edge of the A2 just south of Faversham. Three of the men were killed; the other was seriously injured. We might never know exactly what happened, and I am absolutely not blaming the lorry driver, but that stretch of the A2 is a well-known spot for what we call lorry fly-parking. Fly-parking is when lorries park in lay-bys or on slip roads, hard shoulders, pavements or verges, often at the edge of busy roads such as the A2, the A20 and the A249 in my constituency. Sometimes they also park up quiet country lanes or in industrial estates and housing estates. In general, these are places where lorries should not be parked for more than the few minutes that might be needed for a delivery or an unexpected stop. Sometimes they park legally, and sometimes illegally. Sometimes they park perfectly safely, albeit inconveniently, but at other times, unfortunately, they park dangerously.
This was not the first fatality in my constituency involving a parked lorry. A 74-year-old woman died after crashing into a lorry parked on the hard shoulder at junction 7 of the M20 a couple of years ago. Whatever the cause of the latest crash, this horrific accident should focus our minds on the problem, focus our attention on the need for more lorry parking spaces, and focus our energies on ending lorry fly-parking. Lorry fly-parking is dangerous. There is a danger to other motorists from lorries lined up, bumper to bumper, in lay-bys, sometimes jutting precariously out into the road. There is a danger to the police officers who risk their lives walking along the hard shoulder at night with hundreds of cars speeding by as they move alongside illegally parked trucks. There is also a danger to the lorry drivers themselves when they are in charge of a heavy goods vehicle but have not had a proper rest. A busy roadside with traffic thundering past is hardly a good place to get a proper night’s sleep.
The haulage industry is, rightly, tightly regulated. Drivers must record their hours on a tachograph and take breaks every four and a half hours. When the time comes to stop, they have to stop, but the roadside is not only a bad place to sleep, but a pretty bad place to stop off in general for a driver, as it has no security, no facilities, no showers and not even toilets. That is hardly helpful for an industry that would like to attract more women. From the point of view of most of my constituents —those who are not lorry drivers—they see extra litter and pretty disgusting other stuff on the roadside, and anyone who needs to pull into a lay-by on a main road can forget it, because they are already full.
Jim Shannon (Strangford) (DUP)
I thank the hon. Lady for allowing me to intervene. Northern Ireland is heavily reliant on cargo being freighted by ship and then by lorry, so this issue concerns us greatly. We must ensure that there are safe and secure areas for lorry drivers to park, not only to enable them to stay within their hours under EU legislation, but to keep them and those who come into contact with them safe. Does she agree that we should look into providing parking facilities so that those living in residential areas do not have to listen to idling lorries and so that those who drive the lorries can be safe?
Helen Whately
I completely agree that this is about making things better for residents and ensuring that lorry drivers have the facilities that they need. I thank the hon. Gentleman very much for bringing a Northern Ireland perspective to the debate.
Lorry parking is not a new problem, but it is growing worse and it is time to fix it. So what is the answer? Everyone we speak to, including the Road Haulage Association, the Freight Transport Association, Highways England, local councillors and our constituents, will give the same common-sense answer: we must build more lorry parks. That seems deceptively simple. We know that there is demand for more truck stops. For instance, Kent County Council’s surveys show that we have around 900 lorries a night parking inappropriately. Lorry parks in Kent are turning lorries away. Ashford lorry park turned away 252 trucks in a single night last year, so the demand is clearly there. Kent County Council has been taking action by identifying possible locations for new truck stops and talking to lorry park operators to gauge their interest. Indeed, the Ashford lorry park just yesterday submitted a planning application to expand from 390 to 600 places. Those extra places will be helpful, but the number still falls far short of the 900 extra places needed in Kent. As freight volumes continue to grow with the growing economy, one can predict that that shortfall will only increase.
However, that prompts a question: given that commercial operators run service stations and lorry parks in the UK, why have more truck stops not stepped up to serve the demand? What can we do to ensure that the shortfall in parking places is met, and quickly? What conversations has the Minister had with lorry park operators about what is stopping them expanding? What investigations has he made to determine how we can encourage planning applications for truck stops that can make their way successfully and speedily through the planning system? I recognise that fast-forwarding planning for lorry parks is difficult, given the experience in Kent with the Operation Stack holding area, but when we get that vital lorry holding area, will the Government ensure that it can also be used for overnight lorry parking? I want lorry parking to be included in all major road improvements—specifically the lower Thames crossing—not just in Kent, but across the country.
Andrew Lewer (Northampton South) (Con)
Just as in Faversham and Mid Kent, my constituency experiences a lot of lorry traffic and much of its economy is based on logistics. The Department for Transport focuses heavily on rail—often for good reason—but with the majority of haulage and freight travelling by road, does my hon. Friend agree that the Department needs to consider both rail and road provision? When looking at road provision, the Department needs to consider not just the infrastructure of the roads themselves, but lorry parking and good-quality facilities as a priority.
Helen Whately
I thank my hon. Friend for making the point that investing in road infrastructure, as we are doing in this country, goes hand in hand with planning for where lorries will park and the facilities that drivers will need. No major road investment should be planned without facilities for the motorists and lorry drivers who will use the roads.
As we provide more parking places, we must ensure that drivers use them, and I welcome the signals the Government have been sending about effective enforcement. For example, they have supported the enforcement pilot that is currently under way in Ashford, where lorries are being clamped the first time they park illegally. The pilot has successfully reduced reoffending and the message is getting through, because only one lorry has been clamped twice and all fines have been paid. My hon. Friend the Minister has kindly contributed to that success by allowing the local authority to increase the fines that it can charge, meaning that the council is no longer left out of pocket when lorries are clamped, and I thank him for that. If the clamping pilot continues to get results, I hope that it can be rolled out across Kent and then throughout the country. Eventually, we should have a complete ban on lorries parking for long breaks outside truck stops. However, as drivers have told me many times, it is only reasonable to enforce a ban on lorry fly-parking if there are enough legitimate places for lorries to park.
As I have said, Kent is disproportionately affected by lorry fly-parking because most of the UK’s road freight travels along the M20 and then across the channel or, alternatively, down the M2 and A2 and then down to the channel crossings in Kent. The Port of Dover handles 10,000 HGVs a day. Although we feel the problem so particularly in Kent, it is a national one, and I know from colleagues that there are lorries lining up on many trunk roads across the country. Perhaps at some point in the future we will have self-driving lorries, which I assume will not need to stop to sleep, but that is not going to happen for some years—probably some decades—so we must do something about the issue in the meantime. My hon. Friend the Minister gets that, as did his predecessor, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), and I thank them for the hard work that they have put in so far.
To conclude, may I just say to the Minister that if we are to achieve the vision of a dynamic country that is fit for the future, we need the right infrastructure to keep the economy moving? The current situation is unacceptable for lorry drivers, for other motorists, and for residents who live in the places that have become improvised truck stops. It is also dangerous. We need more lorry parks, better facilities for drivers and effective enforcement. In that way, we can end lorry fly-parking and make our roads safer.
The Parliamentary Under-Secretary of State for Transport (Jesse Norman)
I congratulate my hon. Friend the Member for Faversham and Mid Kent (Helen Whately) on securing this debate about lorry parking, a subject we know from previous debates, including the one last October, is of great importance to Members who represent parts of the country and communities adversely affected by lorry fly-parking. She has been a vigorous and doughty campaigner on this issue. As I recently heard at a roundtable of road freight stakeholders— I hasten to reassure her that that was one of many regular meetings I have with the industry and its stakeholders—it is just as much a concern for trade bodies and driver unions.
My Department is, as one would expect, considering the issue not merely in relation to Kent, although that is of central importance, for reasons I will outline, but on a national basis. But it does have particular salience in Kent and we should be clear about that. The Dover strait ports handle a considerable majority of the entire country’s international road freight, thus creating a particular challenge in relation to HGV traffic in that county. Road freight plays an indispensable role in keeping our economy moving, and we must not lose sight of that fact, but we must also be mindful of the adverse effects it can have on communities, which my hon. Friend has well delineated, and do our best to mitigate them.
I understand that fly-parking can blight localities such as lay-bys, which are not intended for overnight parking and do not generally have even the most basic facilities. I want my hon. Friend to know that colleagues across the Department share that view. In addition to the environmental consequences of fly-parking, she has drawn attention to the potential road safety risks it can pose. Of course, it would not be appropriate for me to comment on the particular causes of the tragic incident she referred to, but, speaking generically, I am grateful to her for highlighting, through it, the potentially devastating consequences of unsafe parking. We must be quite clear: dangerous parking is never acceptable. As is set out in the Highway Code, it is an offence to park in a dangerous position, and such behaviour is rightly the subject of active enforcement by the police. As she has noted, there are provisions in the drivers’ hours rules to enable drivers to depart from the standard limits in order to reach a safe stopping place, so these requirements are no excuse for unsafe parking. Nevertheless, there is no doubt that there is a shortage of overnight lorry parking in Kent and more widely. As my hon. Friend the Member for Northampton South (Andrew Lewer) noted, facilities to enable HGV drivers to take a proper break, in a safe and secure environment and with access to welfare amenities, should be seen as a key part of our national infrastructure.
However, the situation, although complex, is far from hopeless. A number of initiatives are under way which should help to make a real difference and to address the current supply and demand mismatch. I am encouraged by plans in the private sector to bring additional parking provision to the market. In particular, as my hon. Friend the Member for Faversham and Mid Kent mentioned, the plans by Ashford International Truck Stop to double in size are highly encouraging. Other market-led developments, for example in relation to the online booking of parking spaces, should help to maximise the efficient use of existing sites. But government clearly can play a role in facilitating greater provision. Kent County Council is, with the support of Highways England, identifying where additional parking provision is most needed, and that council is working closely with private sector providers to identify what funding options exist to bring those sites into being.
As Kent Members will be well aware, we have been obliged to rethink our previous plans for a lorry park in east Kent for use as part of Operation Stack. However, we remain committed to developing a permanent solution to the issue of lorry parking in the county. I can confirm that the initial public consultation on this, which Highways England expects to launch in the spring, will also seek views on the use of the lorry park for “business-as-usual” overnight parking, precisely as my hon. Friend has suggested.
Nationally, we are looking carefully at the evidence as to gaps between demand and supply throughout the country and the potential role that the Government could play in facilitating development at specific sites. The different measures I have described will not lead overnight to more lorry parking, but they demonstrate that central and local government and private providers are seeking to pull together in the same direction.
My hon. Friend the Member for Faversham and Mid Kent asked what is currently preventing further expansion by operators. She touched on many of the relevant factors in her speech. Ministers and officials have discussed the shortage of lorry parking spaces with a number of providers and potential providers, with a view to understanding what is preventing expansion and how policy measures might make a difference.
As my hon. Friend suggested, planning is a major concern. Motorway service areas are also an important part of the picture, as they provide around half the 15,000 lorry parking spaces throughout the country. The Department for Transport circular that covers planning and roadside facilities on the strategic road network was changed in 2013 to help to enable applications to be considered more efficiently. Nevertheless, developers still take a significant financial risk that, at the planning stage, proposals will be turned down or suffer lengthy delays, even when those developers can be rationally certain that there is significant demand.
Some providers are keen to bring forward innovative business models—for example, by combining truck parks with other services, such as refuelling and services for general motorists. Such models can pose some challenges for planning decisions, including in respect of the need to ensure that different business models are treated fairly in the planning system and in relation to providers’ obligations to pay for the necessary highway access.
Planning permission can, then, be one of the key obstacles to development. In this context, we are examining how best to ensure that the strategic importance of adequate lorry parking is given due weight in planning decisions. However, we should acknowledge that some of the planning challenges reflect the legitimate concerns of local residents and other stakeholders, as one would expect, and each application must be considered on its merits.
This is not just a question of planning risk; it goes to the nature of the business itself. Truck parks are often low-margin businesses, and they require significant space. In that context, the commercial viability of potential truck parks can be limited by the preference of some drivers to park for free by the roadside. Enforcement against inappropriate parking must go alongside the provision of truck parks. It is an important part of the overall solution. By cracking down on the ability to park up for free in inappropriate locations, we should help to provide the market with confidence that demand for proper parking facilities will be there.
I am pleased that my hon. Friend has been so supportive of the enforcement measures that are being piloted on a stretch of the A20, including our “clamp first time” approach. Since I last addressed the House on this subject, that trial has got under way, and we are closely monitoring the results. As my hon. Friend has noticed, I recently authorised Ashford Borough Council to use a higher clamping-release fee, to ensure that the trial remains financially viable.
Early indications are that the trial is going well. In the first few weeks of the 18-month trial, there was no identified displacement into residential areas or other industrial estates in Ashford. The initial signs are that there is a reduction in the level of illegal parking and we are hopeful that over time it will further decrease to a significant extent. I am aware that other councils would be keen to implement similar measures; that could well be a long-term outcome if the trial proves successful, and I know that my hon. Friend gave that suggestion her support in her speech.
It is important to draw well-supported conclusions from the pilot before considering any wider roll-out that may have national implications. However, the local willingness to enforce this robustly should make it clear to potential developers that public authorities can play a part in ensuring that market demand is there if additional provision is forthcoming on the supply side.
Across the country, the Driver and Vehicle Standards Agency has recently begun to issue £300 fixed penalties to drivers caught taking their 45-hour weekly rest in inappropriate locations such as lay-bys. Almost all of those caught so far have been non-GB drivers. Records of such offending will feed into cross-border intelligence sharing about problematic operators at the corporate level.
Before wrapping up, I should take this opportunity to make it clear that we have not lost sight of the importance of the driver welfare dimension to lorry parking. As my hon. Friend highlights, this is all the more pertinent in the context of the industry’s efforts to attract young people and women into driving. Although it should be noted that there are a wide range of jobs in the industry, many of those do not entail overnight stays. In that context, we have reviewed the health and safety regulations in relation to facilities for visiting drivers at distribution centres. I am pleased to say that, as a consequence, the Health and Safety Executive has clarified that drivers must have access to welfare facilities, including toilets, in the premises they visit as part of their work. My Department is working with stakeholders to draw up a statement of rights as to facilities to help to improve the standard of facilities available to drivers at distribution centres.
In addition to the quality of driver facilities at distribution centres, there are of course issues relating to the quantity of on-site parking at some of these developments. It is important, too, to note that local planning authorities should challenge developers to ensure that there is sufficient on-site parking to avoid the displacement of waiting lorries to the surrounding area.
We know that the quality of facilities could be better at some overnight lorry parks, including some motorway service areas—of that there can be no doubt. In this context, I am encouraged by market initiatives to increase the transparency around the facilities available, which should help to drive up standards over time.
Let us be clear that the Government are considering the issue of lorry parking with the importance that it deserves. We will continue to seek out opportunities to facilitate more and better quality provision alongside our industry and local government partners.
Question put and agreed to.
Draft Financial Assistance Scheme (Increased Cap for Long Service) Regulations 2018
(6 years, 10 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State for Work and Pensions (Guy Opperman)
I beg to move,
That the Committee has considered the draft Financial Assistance Scheme (Increased Cap for Long Service) Regulations 2018.
It is an honour to serve under your chairmanship for the first time, Mr Wilson.
The regulations were laid before the House on 18 December 2017, and they deliver a commitment that was made to the House on 15 September 2016 to introduce a cap for long service in the Pension Protection Fund and the financial assistance scheme.
The Government have listened carefully to stakeholders, and a stakeholder consultation took place between last September and October on the draft regulations, which apply to those with long service in a single pension scheme.
The Committee will agree that it was right for the Blair Government to create the Pension Protection Fund and the financial assistance scheme. All successive Governments have supported both schemes, which ensure that individuals who have saved for their retirement during their working lives receive assistance if their pension scheme winds up underfunded.
The regulations increase the maximum amount that an individual can receive from the financial assistance scheme if the individual has long service in an eligible pension scheme. Those who are disproportionately affected by the cap on the amount of assistance payable to an individual member because they have long service in a single scheme will have their maximum cap amount increased. The cap is currently £34,229 at age 65, and reduced if a member opts to receive their assistance early. The cap helps to limit the costs of the FAS, which is funded by the taxpayer.
Individuals accrue high pensions for two reasons. Some will have been high earners, in which case they have generally had opportunities to secure alternative savings for retirement, but others will have worked for the same employer for a long time and consequently may have little or no other private pension savings to offset the shortfall between the capped assistance and what they had expected from the pension scheme had it not failed.
This legislative change will benefit the second group by ensuring that an individual’s long service in a single scheme is not disproportionately affected by the cap. The maximum amount of assistance that is currently paid to an individual will be increased by 3%, funded by the taxpayer, for each full year of pensionable service above 20 years, subject to a new maximum of double the standard FAS cap amount. In those circumstances, I commend the regulations to the Committee.
Jack Dromey (Birmingham, Erdington) (Lab)
It is a pleasure to serve under your chairmanship, Mr Wilson.
The regulations are welcome and we support them, but we want to ask some questions. The Minister is right that they represent a continuity of policy. We may have substantial disagreements about pension policy, but the regulations represent a continuity of policy under successive Governments.
The regulations will increase assistance payments for members of the financial assistance scheme who have been disproportionately affected by the cap on the amount of assistance payable to an individual member under the scheme. They will make changes to legislation to increase the current financial assistance scheme cap for those with long service in a single eligible pension scheme.
It is estimated that 290 FAS members will benefit from the introduction of the regulations over the lifetime of the financial assistance scheme. Although that is not many people, it is a significant proportion of the 500 people estimated to be affected by the cap.
On 6 April 2017, provisions for a long service cap were implemented in the Pension Protection Fund, and the regulations introduce a similar long service cap into the financial assistance scheme. The Pension Protection Fund provides compensation for pension scheme members whose employer became insolvent on or after 6 April 2005.
From its commencement, the financial assistance scheme was criticised for providing less generous support than the Pension Protection Fund. However, successive Governments have made significant improvements to the scheme, and that is welcome.
I want to ask some questions that arise out of engagement with stakeholders on the one hand and discussions in the other place on the other. The dialogue around the proposals has been generally constructive.
First, it was announced that from 2016 the financial assistance scheme would be closed to new applications. That decision keeps the scheme open some 10 years longer than was originally planned, but have the Government made any assessment of how many individuals will lose out as a result and how much the Government will save? Failure to access the scheme may be laid at the door of trustees or scheme administrators, but any loss will be suffered by members. Is that fair? Will failure to seek access to the scheme cause any restriction to access to social security benefits?
Another issue that arises is whether the regulations should define pensionable service. Such a definition would help to avoid confusion in cases in which service is under another scheme and is to be disallowed. The Government say that they are content to rely on information from trustees about pensionable service, based on the definition contained in individual scheme rules. However, one bugbear of the scheme, at least initially, was the poor quality of data held by various schemes. What is the current situation in that regard? What confidence is there across the board that scheme data are now more robust? In how many cases and on what points has the scheme manager had to issue guidance to individual schemes?
We note that no impact assessment has been offered for the regulations, although reference is made to the impact assessment for the Pensions Act 2014. Will the Minister tell us why no such assessment has been prepared, particularly given that after asset transfers and recovery, the scheme’s net costs are met by the public purse? Since the regulations will apply to Wales as well as to the rest of Britain, may I ask whether they have any relevance to the controversial issue of steelworkers at the Tata-owned Port Talbot works?
Guy Opperman
I am grateful for the hon. Gentleman’s questions. Let me address them briefly in reverse.
On Port Talbot, the reality is that members of the British Steel pension scheme who do not opt to enter the BSPS2 opt-out will go into the Pension Protection Fund, so they will not be affected by the financial assistance scheme.
On data, the hon. Gentleman raises a fair and legitimate point that has concerned successive Governments. I know that he is a massive supporter, as I am, of the pensions dashboard, an effort from the Government and from all organisations that run pension schemes to make data accessible on a uniform platform. We have launched that initiative and the Department for Work and Pensions is taking it forward. I will happily set out more detail in writing on that point and others, but to put it bluntly, we all agree that data needs to be improved and made accessible in a single portal. We will report to the House before the end of this term with the results of the DWP feasibility study on the dashboard. We hope to take it forward in 2019.
On the assessment of the losses to members from the closure of the FAS, 10 years’ notice of the closure was given—that was widely publicised in 2016. The hon. Gentleman also raised the impact on social security benefits of failure to seek access to the FAS. I reassure him that since it is the responsibility of the scheme trustees to apply to the FAS and there is no requirement for individual members to do so, it is extremely unlikely that failure to apply to the FAS would have an impact on a member’s social security benefits.
I accept entirely that there may be some outstanding matters on which I will need to double-check that I have responded to the hon. Gentleman, and I shall do so in writing. I believe that the regulations strike the correct balance between securing meaningful income in retirement for members compensated by the financial assistance scheme and managing the cost to the taxpayer. They show that we have decided to act to fix a long-standing problem with a scheme that has long been supported—and rightly so—by successive Governments.
Question put and agreed to.
Ministerial Correction
(6 years, 10 months ago)
Ministerial CorrectionsRead Full debate Read Hansard Text
Education
(6 years, 10 months ago)
Ministerial CorrectionsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for Apprenticeships and Skills (Anne Milton)
T-levels are not in place yet. I wish they were, but they are coming down the road soon. They are part of a consultation. We are also changing completely the approach to careers, and—I am skimming through my notes now—there is the devolution of 25% of the adult education budget. The areas where it is being devolved to have asked for more time, but it will be devolved in 2019-20.
[Official Report, 23 January 2018, Vol. 635, c. 68WH.]
Letter of correction from Anne Milton:
An error has been identified in the speech I made in the Westminster Hall debate on Skills Devolution (England) on 23 January 2018.
The correct response should have been:
The Minister for Apprenticeships and Skills (Anne Milton)
T-levels are not in place yet. I wish they were, but they are coming down the road soon. They are part of a consultation. We are also changing completely the approach to careers, and—I am skimming through my notes now—there is the devolution of 50% of the adult education budget, of which 25% is being devolved to London. The areas where it is being devolved to have asked for more time, but it will be devolved in 2019-20.
Taxation (Cross-border Trade) Bill (Fifth sitting)
Tuesday 30th January 2018
(6 years, 10 months ago)
Public Bill CommitteesRead Full debate Taxation (Cross-border Trade) Act 2018 View all Taxation (Cross-border Trade) Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 30 January 2018 - (30 Jan 2018)
The Committee divided: - Ayes: 8 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I beg to move amendment 137, in clause 13, page 9, line 4, leave out “public notice” and insert “regulations”.
This amendment, together with Amendments 138 and 139, makes the power to give effect to an accepted recommendation of the TRA exercisable by regulations rather than public notice.
The Chair
With this it will be convenient to discuss the following:
Amendment 138, in clause 13, page 9, line 8, leave out “public notice” and insert “regulations”.
See explanatory statement for amendment 137.
Amendment 139, in clause 13, page 9, line 17, leave out “public notice” and insert “regulations”.
See explanatory statement for amendment 137.
Jonathan Reynolds
Good morning, Ms Buck. It is a pleasure to begin the second week of our Committee’s consideration of the Bill.
The amendments, like many that the Opposition have tabled, concern the democratic deficit in the Bill. As we have covered in numerous evidence sessions and in our discussions so far, the Bill is far too reliant on secondary legislation. The scrutiny of Delegated Legislation Committees—especially those that consider instruments laid according to the negative procedure, as the majority will be—is insufficient for taxation matters of such potential magnitude. Parliament will have the option to raise objections to the instruments, but they will not be debated on the Floor of the House as a matter of course.
The amendments are important because the Bill introduces an even more troubling concept: that of making law by public notice. After Second Reading earlier this month, the House of Lords Delegated Powers and Regulatory Reform Committee published a report that probed the most worrying aspects in detail. The report emphasises that the concept of public notice, on which the Bill is heavily reliant, is effectively a modern form of rule by proclamation that removes the opportunity for parliamentary scrutiny. It states:
“For Ministers and others to make law by ‘public notice’, without any recourse to Parliament, is highly unusual and such provisions should attract strict surveillance by Parliament.”
It also notes that
“the Treasury’s Delegated Powers Memorandum says that such notices will only make provision that is purely technical or administrative in nature. Nonetheless, clause 32(9) of the Bill allows anything that can be done under public notice to be done by regulations, implicitly acknowledging the importance of things done by public notice.”
It identifies the Bill as a throwback to the Statute of Proclamations 1539, which
“gave proclamations the force of statute law…it was repealed in 1547 after the death of Henry VIII”.
We should all be grateful for the institutional memory of the House of Lords.
Equally problematic are the mechanics by which public notice takes place. As the Delegated Powers and Regulatory Reform Committee emphasises, under clause 37(5) the only qualification for public notice is that the person who issues it has selected a channel that they consider appropriate, but a definition of “appropriate” is absent from the Bill. Public notice could therefore mean anything from a full-page advert in the Financial Times to a small ad in a trade journal or perhaps even a tweet. Clause 24 permits Her Majesty’s Revenue and Customs to establish a system for making rulings to determine the customs code and the place of origin of particular goods, both of which have an impact on the duty. Other rulings could affect the rights and liabilities of an individual.
The Delegated Powers and Regulatory Reform Committee recommends
“the creation of a generally applicable system for making determinations which are capable of affecting an individual’s legal position should ordinarily be dealt with by legislation, subject to scrutiny by Parliament, rather than by public notice without any such scrutiny”—
checks and balances. The Opposition agree wholeheartedly —hence our amendments.
The Government’s manoeuvres are deeply concerning. We would be failing in our duty of scrutiny if we did not step in to raise our anxieties about how powers of proclamation may be used. We are well aware of the volume of new legislation that needs to be produced to create and implement a new customs code, and of the temptation to create or take advantage of constitutional shortcuts to facilitate the process. However, protecting the rights of the individual must come first. Where matters of taxation are concerned, the parliamentary process is usually more rigorous with respect to the reasons for setting the duty.
As I have already said, the secondary legislation process is not optimal, and we believe that the balance between primary and secondary legislation in the Bill is unsound. However, using delegated legislation for these matters instead of creating regulations by public notice would surely be the least-worst option. It would allow for a bare minimum of parliamentary involvement and oversight of new tax and customs law. Even the negative procedure gives Parliament the option to reject a statutory instrument, although no formal debate takes place. Where possible, more significant matters should surely be considered via the affirmative procedure, so that at least there would be the basis for debate.
The Opposition believe that, without such debate, we will be at risk of setting a dangerous precedent that allows the ruling Executive to make regulation by public notice as it pleases, potentially even beyond the scope of the Bill. Therefore I call upon all members of the Committee to support the amendment, to ensure that we can continue to perform our vital role providing checks and balances in the structure of taxation and customs law in the UK.
Kirsty Blackman (Aberdeen North) (SNP)
Thank you for the opportunity to speak and for chairing the meeting, Ms Buck. I would like to speak briefly around the amendments. One of my earliest questions about the Bill was: what is a public notice and how does one justify that it has been made sufficiently public? The Opposition raised that case clearly. On the definition of public notice and the fact that the person making the public notice has to make that judgment call, particularly in relation to clause 13, which concerns the dumping of goods, foreign subsidies and increases in imports, and given that the UK has not had provision to make regulations and rules, it seems sensible to say that a public notice is not the best way. Parliament should have some say. We have raised concerns previously that, although Brexit is apparently about taking back control, it appears that control is being taken back to the Executive rather than to Parliament as a whole. I will therefore support amendments 137 to 139 if they are pushed to a vote.
The Parliamentary Under-Secretary of State for International Trade (Graham Stuart)
It is a great pleasure to serve under your chairmanship again, Ms Buck, and to welcome back the hon. Member for Stalybridge and Hyde. This group of amendments would require trade remedies measures to be imposed and given legal effect by regulations. I appreciate the concerns in relation to the use of public notices, which were raised by both Her Majesty’s Opposition and the Scottish nationalist party representative. I am grateful for the opportunity to set out why this is an entirely appropriate procedure for imposing trade remedies measures.
If you were cynical, Ms Buck, you might think that, because the Opposition have decided to make parliamentary scrutiny the central theme of their critique of the Bill, they are leveraging that into every single argument at every single stage. I am not a cynic, and take the concerns at face value, as the genuine ones that I am sure they are.
The imperative is to act quickly once the Trade Remedies Authority has identified the need to tackle injury to UK industry. I would have hoped that Members on both sides of the Committee would recognise that the imperative is to act quickly when injury to UK producers has been identified, and to move as swiftly as possible to put that right. Measures will be calculated and recommended by a fully expert and independent body, following an extensive investigation that is governed by strict World Trade Organisation rules. Our priority has to be to ensure that those recommended measures are imposed quickly, to provide relief to industries suffering injury.
The additional proposed process would delay our ability to apply measures precisely at a time when UK industry is suffering injury, and when it has been independently established that that is so. It would run counter to the calls we have heard from industry for a swift process. The use of public notices to implement trade remedies measures is consistent with the approach taken in comparable WTO countries such as New Zealand and Australia, and is therefore in line with international good practice.
Therefore I say to the hon. Member for Stalybridge and Hyde that, to suggest that this use of public notice is untoward and could lead to further government by proclamation, even outwith the Bill, is disproportionate. The reality is that this set of amendments, as with so many put forward by the Opposition, would in fact undermine the very principles that they say they are interested in: namely, to protect UK industry to ensure that we have a proportionate and speedy response to unfair dumping or use of subsidy and make sure that injury to British industry is put right. It is a shame that, collectively, the Opposition’s amendments suggest that their priorities are somewhere else.
Jonathan Reynolds
The Minister’s case is that this needs to be used for reasons of speed. Can he give us detailed information about how long it takes to prepare a statutory instrument to be brought before the House, given that that does not need parliamentary time in the Chamber—it cannot be that extensive? Exactly how much time will be saved by this proposed new form of parliamentary process?
Graham Stuart
The hon. Gentleman has been in the House for some time. I would have thought he would be familiar with the calendar of the parliamentary year, with long periods of recess when Parliament does not sit. Why on earth would Her Majesty’s Opposition, so often accused, doubtlessly unfairly, of being in hock to the producer interest and blind to wider society and the interests of the consumer and the ordinary citizen—though I decry that attitude—because of their links to the trade union movement, wish to put delays in place?
The hon. Gentleman knows full well the delays that can come with secondary legislation. To have that at the end of that extensive, independent and exhaustive expert assessment that has established injury, why on earth would the Labour party, or indeed the Scottish nationalist party, want to get in the way of swift, effective and proper defence of British jobs, British workers and British business?
Kirsty Blackman
I am pleased that the Government are now concerned with ensuring that such things are put in place incredibly quickly if there is injury to UK industry. In that case, will the Government bring forward amendments to speed up other parts of the process, given that they will now be taking longer than the EU’s similar processes?
Graham Stuart
I apologise for getting the name of the hon. Lady’s party wrong—it is the Scottish National party. We have put forward a proportionate and swift system, and hope that we would be able to deliver a speedier, more proportionate and balanced response than that of the EU. That is certainly our aim. I note again that amendments tabled by the hon. Lady’s party and Her Majesty’s Opposition suggest that their priority is entirely different.
Jonathan Reynolds
I am grateful for the infusion of energy that the amendments have brought to the Committee. The Minister’s bluster revealed a lot. I noticed that he did not actually answer my question. If the Government’s concern is the wish to bring a trade remedy during recess, they have to invent a new constitutional procedure to do that. I am afraid that is a very thin case and the Minister did not provide a reason why the new process is required in the interests of brevity. He was not able to give us any clear information, so we will push the amendment to a vote.
Question put, That the amendment be made.
The Chair
With this is will be convenient to discuss the following:
Amendment 12, in clause 32, page 19, line 32, after “which” insert—
“section (Dumping of goods and related activities: enhanced parliamentary procedure, etc)(6) applies and”.
This amendment is consequential on NC5.
New clause 5—Dumping of goods and related activities: enhanced parliamentary procedure, etc—
“(1) No regulations may be made by the Secretary of State in exercise of the power in section 13(5) except in accordance with the steps set out in subsections (2) to (5).
(2) The first step is that a Minister of the Crown must lay before the House of Commons a draft of the regulations that it is proposed be made.
(3) The second step is that a Minister of the Crown must make a motion for a resolution in the House of Commons setting out, in respect of proposed regulations of which a draft has been laid in accordance with subsection (2)(b), the amount of import duty proposed to be applicable to any goods that are or are proposed to be subject to a quota.
(4) The third step is that the House of Commons passes a resolution arising from the motion made in the form specified in subsection (4) (whether in the form of that motion or as amended).
(5) The fourth step is that the regulations that may then be made must, in respect of any matters specified in subsection (4), give effect to the terms of the resolution referred to in subsection (5).
(6) No regulations may be made under the following provisions unless a draft has been laid before and approved by a resolution of the House of Commons—
(a) paragraph 1(3) of Schedule 4 (definitions and determinations in relation to goods being “dumped”);
(b) paragraph 5 of Schedule 4 (determination of certain matters relating to “injury” to a UK industry);
(c) paragraph 26(1) of Schedule 4 (provision for suspension of anti-dumping or anti-subsidy remedies);
(d) paragraph (1)(2)(c) of Schedule 5 (defining a “significant” increase)
(e) paragraph 2 of Schedule 5 (definitions relating to “serious injury” to a UK industry);
(f) paragraph 22(1) of Schedule 5 (provision for suspension of safeguarding remedies).”
This new clause establishes a system of enhanced parliamentary procedure for regulations setting quotas under Clause 13 to give effect to recommendations of the TRA, with a requirement for the House of Commons to pass an amendable resolution authorising the quota provisions of the proposed regulations, and also requires that certain regulations under Schedules 4 and 5 are subject to the affirmative procedure.
Graham Stuart
The Bill ensures that the UK customs regime is ready for EU exit. A key part of our readiness for exit day is our ability to operate our own trade remedies system. Trade is good for the UK. It can lead to higher wages, stimulate business efficiency and productivity and improve consumer choice. Analysis by the OECD suggests that a 10% increase in openness is associated with a 4% increase in income per head.
Nic Dakin (Scunthorpe) (Lab)
Will the Minister clarify whether the Government have done a comparative impact assessment of the processes involved with the EU and the processes they are trying to put in place in terms of speed and timeliness, which we are all concerned about?
Graham Stuart
I am grateful to the hon. Gentleman for that question. I will seek at some point in the debate to address his point.
Free trade does not and should not mean trade without rules. Trade remedies are an important safety net. They can help enforce the rules that make free trade work by addressing injury to a domestic industry caused by unfair trading practices or unforeseen surges in imports. That is why all major WTO members have a trade remedies regime, and why we are taking forward the measures in the Bill. The European Commission currently carries out trade remedies investigations and imposes measures on our behalf. Once we leave the EU, we will need to be able to do that for ourselves. Clause 13, together with schedules 4 and 5, sets up the UK framework to allow us to do just that.
These proposals fall under the international framework set by the WTO. We are legislating for the full suite of powers permitted under that framework, which will enable us to impose additional duties on imports that cause injury to UK industry. The message is clear: free trade and the benefits it brings are welcome, but the UK will act decisively to address trade that causes injury to our domestic industries.
We cannot forget the wider ecosystem of our economy. Tackling injury is the priority, and the Bill makes clear that there is a presumption in favour of imposing additional duties when UK industry suffers injury as a result of unfairly dumped or subsidised imports. In recent years, trade remedy measures have protected UK industry and its employees, particularly in the steel and ceramics sectors but also in the chemicals, biofuels and glass industries. Considering that manufacturing contributes around 10% of UK gross value added and 8% of employment, the need for the UK to have a trade remedies system once we leave the EU is apparent.
Without the ability operate our own trade remedies regime, the UK would be exposed to unfair trading practices and unforeseen surges in imports, with potentially damaging consequences for UK industry and the economy more widely. However, there must also be a mechanism for ensuring that imposing such duties is not contrary to the best interests of the UK as a whole. Duties on imports can increase costs for downstream industries that use those imports to create their products. They can also hit the purses of consumers. That is why the Bill ensures that any duties are set at the level needed to address injury to UK industry and no higher. That levels the playing field without causing unnecessary harm to downstream users and consumers.
We are also building in a safety valve to ensure that measures are not imposed where they are not in the overall interests of the UK. The economic interest test will consider whether duties would have a disproportionate impact on a particular area of the UK or on particular groups in the UK. The test will also consider issues such as the impact on the longer-term competitive environment in the UK.
Businesses can have full confidence that that test, and investigations as a whole, will be objective and impartial. The new Trade Remedies Authority, which will be established through the Trade Bill, will have the independence and technical expertise to determine complex matters of fact. When the authority concludes that measures are justified, it will make independent recommendations to Ministers, who will then reach a final decision. Ministers will be able to reject recommendations to impose duties where they consider they are not in the public interest. Where Ministers do so, they will do so transparently, and they will have to make a statement to Parliament setting out their reasons.
As Monckton Chambers noted in its response to the trade White Paper, that structure ensures that
“the complex judgments made in such cases are, and are seen to be, made independently”.
It strikes a delicate balance between ensuring that the investigation and the calculation of proportionate duties is carried out by impartial experts, and ensuring that there is an opportunity for Ministers to intervene if duties are not in the public or wider economic interest. We believe that these provisions are therefore fundamental to establish a robust but proportionate trade remedies system for the UK.
Peter Dowd (Bootle) (Lab)
It is lovely to serve under your chairmanship again today, Ms Buck. The Minister has clearly had three or four Weetabix today, given his assertions. I say to him: legislate in haste and repent in court at leisure—for these are the sort of things that will be challenged in the courts. Unless the judges in those courts are going to be enemies of the people, we are best to get it right first-hand. Lord Judge made that very point today, and he was formerly Lord Chief Justice; so we cannot ignore parliamentary scrutiny on this particular issue.
New clause 5 establishes a system of enhanced parliamentary regulations for setting quotas under clause 13 to give effect to recommendations of the TRA, with a requirement for the House to pass an amendable resolution authorising the quota provisions of the proposed regulations. It also requires that certain regulations under schedules 4 and 5 be subject to the affirmative procedure.
I have made this point in the past and make it again. The new clause seeks to introduce a scrutiny role for Parliament in this crucial area of taxation and trade policy. The current provision in clause 13 gives the Secretary of State powers through regulation to introduce a tariff rate quota to determine the amount of import duty applicable to certain imported goods, after he has accepted a recommendation from the Trade Remedies Authority. It also gives the Secretary of State the power to revoke or suspend the tariff rate quota.
New clause 5 would instead ensure a democratic and open process, by making sure that Parliament has that power—not just the Secretary of State. The enhanced parliamentary procedure also ensures that there is a failsafe in the event that the Trade Remedies Authority makes a recommendation for the suspension of a quota and the Secretary of State refuses. In that instance Parliament has the ability to overrule the Secretary of State and side with the expert recommendation of the Trade Remedies Authority if it so decides.
I am sure that hon. Members of the Committee are hearing echoes from last week in relation to the issue of parliamentary scrutiny. We have heard about it today, and that is our job on this side of the Committee. I am not sure whether the Minister thinks we should not do that, but we will continue to do it. We are concerned that if we do not have parliamentary scrutiny and oversight and the expertise that comes with that, we will end up in the courts. The Minister’s wish that things do not get delayed will be thrown out of the window by the approach that the Government seem to be taking.
Suffice to say that, if the Government are arguing that this is a money Bill, which it is, and it goes to the House of Lords— who will probably have to watch it go past as though it was a bus—they are tacitly accepting that the measures contained here are essentially fiscal. It is therefore appropriate that statements made to the House of any regulatory changes in relation to fiscal matters are Parliament’s responsibility and duty, as they have been for centuries, and we believe that there should be a vote if appropriate. The system outlined would provide a very robust means of doing that. I know that virtually every Minister, not just this Minister, would not want to have that level of scrutiny, but it comes with the job; scrutiny has to be there. Of course, an annual fiscal statement, such as that expected in the spring, with subsequent parliamentary authority could also prove a mechanism for us to test it out.
I hope that Conservative Members will not take a blasé approach and brush aside the issue of parliamentary democracy on the grounds that the Opposition somehow want to drag the matter out in the future. We do not; we want to make sure that this works properly. We all accept that we have to have a process in place, but let us get it right and hold Ministers to account.
Kirsty Blackman
The Government have asked for an awful lot of trust. They are asking us to trust them to make the right decision. Given that they do not have a track record of making such decisions over a very long number of years, it is very difficult for us to trust the Government on that. There is also the fact that the Government said that they would table amendments to clause 11 of the European Union (Withdrawal) Bill, and then they did not.
I do not think that the Conservative Government have quite recognised what they are doing with all their decisions to hold power in the Executive over any number of things. When the Conservatives are inevitably no longer in government there will be another Government in place, and they will be in opposition saying, “Why are so many decisions being made by the Executive without parliamentary scrutiny?”
The UK is at a point where we are choosing how our future looks in relation to Brexit. We are choosing how things will go in this Parliament, and into the future. We are choosing how much say we will have over trade policy, so it is vital how we decide to go about this. The way that the Government are setting this up is absolutely wrong. There should be parliamentary scrutiny of such things, and democratically elected Members should have the opportunity to look at them, to have an input and not just have them done by public notice.
Graham Stuart
The Opposition parties protest too much. As we all know, the point of a trade remedies system is to be balanced, proportionate and move swiftly to protect British industry. That is why we are setting up, through the Trade Bill, the specialist body to do that: the Trade Remedies Authority. We are talking about the implementation of the Trade Remedies Authority’s recommendations. Why on earth, after that exhaustive effort, with the appropriate, balanced tests in place, would anyone want to create burdensome, parliamentary oversight? It does not make any sense.
The TRA makes the decision. If the Secretary of State disagrees with it, they will have to come to Parliament and make a statement, so there will be the opportunity to deal with that. When the TRA has made an assessment and wants to help British industry, why on earth would the Opposition parties want to make a wider political point about lack of scrutiny, just for the sake of it, when it is totally inappropriate for this measure? I leave outsiders to judge whether that is for political interests or for the interests of either British consumers or producers.
Kirsty Blackman
If the Trade Remedies Authority will be so good at making decisions, why will the Government simply have to make a written statement to the House if they disagree with it, rather than go through some kind of regulation procedure? If the Trade Remedies Authority is set up in such a great way that it will always make the best decisions, why will the Minister be allowed to disagree with it simply by written statement, and not by any sort of parliamentary procedure?
Graham Stuart
The legislation makes it clear that the Secretary of State should look at it, and various people who have commented on the structure have said that it is right that, although the main body of work should be conducted by experts, ultimately it should be a politician accountable to Parliament, part of a democratic process, who should make that decision. Were they in any way to disagree, they would have to come to Parliament to make a statement. That is appropriate and proportionate, and why on earth the Opposition parties would want to go to such lengths to try to stop us bringing in effective remedy to protect British producers, I cannot imagine.
Jonathan Reynolds
Very briefly, why can the Minister not give us any detail about the methodology by which injury will be calculated, or any of the basic details that the US and the EU have already put in primary legislation? He cannot tell us how that will be because it is not in the Bill. Surely, we need some parliamentary safeguards about what the decisions will be, because the Minister cannot tell us the process that will be followed.
Graham Stuart
Our purpose here is to be probed, so even when that probing is redundant or tiresome, one should deal with it in as fair a way as one possibly can. As we know, this is a framework Bill; the secondary legislation, which will have parliamentary scrutiny, will bring in the details as it does in most other jurisdictions. We will follow a balanced, proportionate and effective basis to ensure that we assess that injury in the right way, and we will do so under the aegis of the WTO. Efforts to cut and paste aspects of the WTO system on to the face of our legislation when we are subject to WTO rules anyway are unhelpful and unnecessary.
Question put and agreed to.
Clause 13 accordingly ordered to stand part of the Bill.
Schedule 4
Dumping of goods or foreign subsidies causing injury to UK industry
Peter Dowd
I beg to move amendment 23, in schedule 4, page 58, line 2, after “consumption”, insert “by independent customers”.
This amendment requires the comparable price for the purposes of determining the normal value to be assessed with respect to consumption by independent customers.
The Chair
With this it will be convenient to discuss the following:
Amendment 24, in schedule 4, page 58, line 4, at end insert “sub-paragraphs (2A) to (2L) and with”.
This amendment paves the way for Amendment 25.
Amendment 25, in schedule 4, page 58, line 6, at end insert—
“(2A) For the purposes of sub-paragraph (2) the following shall apply.
(2B) Where the exporter in the exporting country does not produce or does not sell the like goods, the normal value may be established on the basis of prices of other sellers or producers.
(2C) Prices between parties which appear to be associated or to have a compensatory arrangement with each other shall not be considered to be in the ordinary course of trade and shall not be used to establish the normal value unless it is determined that they are unaffected by the relationship.
(2D) Sales of the like goods intended for consumption in the exporting foreign country or territory shall normally be used to determine the normal value if such sales volume constitutes 5% or more of the sales volume exported to the United Kingdom, but a lower volume of sales may be used when, for example, the prices charged are considered representative for the market concerned.
(2E) When there are no or insufficient sales of the like goods in the ordinary course of trade, or where, because of the particular market situation, such sales do not permit a proper comparison, the normal value shall be calculated on the basis of—
(a) the cost of production in the country of origin plus a reasonable amount for selling, general and administrative costs and for profits, or
(b) the export prices, in the ordinary course of trade, to an appropriate third country, provided that those prices are representative.
(2F) Sales of the like goods in the domestic market of the exporting foreign country or territory, or export sales to a third country, at prices below unit production costs plus selling, general and administrative costs shall be treated as not being in the ordinary course of trade by reason of price, and disregarded in determining the normal value, if it is determined that such sales are made within an extended period in substantial quantities, and are at prices which do not provide for the recovery of all costs within a reasonable period of time.
(2G) The amounts for selling, for general and administrative costs and for profits shall be based whenever possible on actual data pertaining to production and sales, in the ordinary course of trade, of the like product by the exporter or producer under investigation.
(2H) When it is not possible to determine such amounts on the basis prescribed in sub-paragraph (2G), the amounts may be determined on the basis of—
(a) the weighted average of the actual amounts determined for other exporters or producers subject to investigation in respect of production and sales of the like product in the domestic market of the country of origin,
(b) the actual amounts applicable to production and sales, in the ordinary course of trade, of the same general category of products for the exporter or producer in question in the domestic market of the country of origin,
(c) any other reasonable method, provided that the amount for profit so established shall not exceed the profit normally realised by other exporters or producers on sales of products of the same general category in the domestic market of the country of origin.
(2I) If the TRA determines that it is not appropriate to use domestic prices and costs in the exporting country due to the existence in that country of significant distortions, the normal value shall be constructed exclusively on the basis of costs of production and sale reflecting undistorted prices or benchmarks, subject to the following provisions.
(2J) “Significant distortions” for this purpose means distortions which occur when reported prices or costs, including the costs of raw materials and energy, are not the result of free market forces because they are affected by substantial government intervention.
(2K) The TRA shall use the corresponding costs of production and sale in an appropriate representative country with a similar level of economic development as the exporting country, provided the relevant data are readily available; and, where there is more than one such country, preference shall be given, where appropriate, to countries with an adequate level of social and environmental protection;
(2L) If such data are not available, the TRA may use any other evidence it deems appropriate for establishing a fair normal value, including undistorted international prices, costs, or benchmarks; or costs in the exporting country to the extent that they are positively established not to be distorted.”
This amendment makes further provision on the face of the Bill about how the normal value and the comparable price are to be determined in certain circumstances.
Amendment 26, in schedule 4, page 58, line 6, at end insert—
“(2M) A fair comparison shall be made between the export price and the normal value.
(2N) The comparison for the purposes of sub-paragraph (2M) shall be made at the same level of trade and in respect of sales made at, as closely as possible, the same time and with due account taken of other differences which affect price comparability.
(2O) Where the normal value and the export price as established are not on such a comparable basis, due allowance, in the form of adjustments, shall be made in each case, on its merits, for differences in factors which are claimed, and demonstrated, to affect prices and price comparability.”
This amendment provides for fair comparison between the export price and the normal value.
Amendment 27, in schedule 4, page 58, leave out lines 8 to 15 and insert—
“(a) to provide guidance with respect to the application of sub-paragraphs (2) to (2O).”
This amendment replaces the provision for definitions of key terms and the determination of related matters in individual cases with guidance about the application of the existing provisions and those contained in Amendments 25 and 26.
Amendment 62, in schedule 5, page 80, line 5, at end insert—
“and shall be determined in accordance with Article 4 of the WTO Agreement on Safeguards.”
This amendment provides that the meaning of serious injury for the purposes of Schedule 5 shall reflect the relevant provisions of WTO Agreement on Safeguards.
Amendment 63, in schedule 5, page 80, line 6, after “make” insert “further”.
This amendment is consequential on Amendment 62.
Amendment 64, in schedule 5, page 80, line 9, after “make” insert “further”.
This amendment is consequential on Amendment 62.
Peter Dowd
Clearly, being tiresome is my role in life, as far as the Minister is concerned.
Peter Dowd
I do it very well. I will make sure I have five Weetabix on Thursday.
I am glad to turn to some of the very substantial amendments that we seek to demonstrate to the Committee are essential for the proper operation of our customs regime and to provide a level playing field for vital British industries. We want to ensure that British industries do well. We wish them the best and we want to set the framework for them to do well. I say gently to the Minister that the only political points being made are from him. We all want British industry to do well; we all have industry and businesses in our constituencies—I have a huge port in my constituency. Frankly, the idea that Labour wants businesses to do well simply because of parliamentary democracy is nonsensical.
The amendments clarify a number of important points about constructing a functional trade remedy mechanism that will not be open to challenge in the courts and will not slow the process down. The Government seem to have completely missed that. The amendments will establish a level playing field for the purpose of promoting and encouraging free trade across UK borders, ensuring that British producers are not unfairly disadvantaged.
It is important at this stage to remind ourselves of the comments made at the Bill’s evidence session on this particular point, to briefly set the context for the amendments. Dr Cohen from the British Ceramic Confederation pointed out last week that a remedy is not a matter of protectionism, but is simply a means of addressing “unfair competition” when overseas manufacturers are not playing by the internationally agreed rules. Dr Cohen made it clear, by using the example of the ceramics industry in the Minister’s constituency, that it is not the case that our producers have skimped on investment or have failed to seek out productivity enhancing measures, because they take every opportunity to compete. Indeed they have made very heavy investment in
“state-of-the-art, energy-efficient manufacturing with digital printing technology.”
Given a level playing field, this industry can, in Dr Cohen’s words,
“take on the world. All we want is a level playing field” ––[Official Report, Taxation (Cross-border Trade) Public Bill Committee, 23 January 2018; c. 67, Q104.]
and trade remedies that allow us to ensure the greatest level of trade.
Nic Dakin
It is a pleasure as always to serve under your chairmanship, Ms Buck. As my hon. Friend has pointed out, the amendment is about certainty for business and industry. At some point, the Government need to bring detail forward. The longer detail is left, the more problematic it will be for business confidence, particularly in an industry such as steel, which is freely traded. It is a free trade industry, so it needs to ensure fair trade. That is why it is not surprising that steel has such a significant number of trade defence instruments in the European Union. That ensures a level playing field under WTO rules against other parts of the world where people want to trade unfreely.
At some point the Government need to bring forward the detail. The problem with this part of the Bill is that it is just a framework with nothing more to it. I therefore very much welcome the amendments tabled by my hon. Friends, because they would bring some certainty and sense into the area. At some point the Government will have to do that. They may say the amendments are not appropriate now—they are drawn very much from what is already there in the European Union and have been written across—so my challenge to them is to ask why they are not appropriate. When will we have the appropriate provisions in place?
We need to have certainty and confidence. These major foundation industries, such as steel, ceramics, oil and gas, that rely on strong trade defence instruments to ensure that they can trade not only freely but fairly need significant capital investment to stay at the cutting edge of development. To make that capital investment now, they need confidence about the framework of the future. That is why the Government should not dilly-dally. The sooner they can bring things forward the better.
The Opposition are doing their job in trying to be helpful to Government by bringing forward something that is compliant with WTO rules and would give the necessary confidence. We would know more about how investigations would be conducted, how calculations would be made and how remedies would be applied—the sort of detail that industry needs.
In a sense, the challenge to the Government is that we all agree. I welcome the Minister’s robust approach this morning—it is the approach we always enjoy from him—but there has been a clear commitment to speedy, timely and effective protection and relief for businesses that are unfairly competed against by the threat of dumping from abroad. However, we need appropriate mechanisms in place to deliver on that rhetoric. The longer it takes to get that detail in place, the more the hesitation, concern and lack of trust in the Government will grow. It is in no one’s interest that the Government should not be trusted in such a crucial area. Therefore, the Government, by taking steps sooner rather than later, and embracing the Opposition proposals, would be moving briskly in the direction of the Minister’s rhetoric.
Graham Stuart
I thank the hon. Members for Bootle and for Scunthorpe for excellent contributions to the debate. I entirely agreed with many of the issues that they highlighted.
The amendments would set out a great deal of the technical detail about the determination and calculation of dumping on the face of the Bill, rather than in secondary legislation, and would require the Government to define the meaning of
“serious injury to UK producers”
affected by unforeseen surges in imports, in accordance with article 4 of the WTO Agreement on Safeguards.
Of course, we accept that it will be necessary to set out further details in legislation. As I and my right hon. Friend the Financial Secretary have said from the beginning, the Bill is a framework Bill. It is intended to provide the framework for the UK’s trade remedy system but, as is normal where there is a great deal of technical detail to be legislated for, that will be set out in secondary legislation.
Industry has contributed its thinking to the detailed technical areas, and we shall engage with all stakeholders with detailed proposals in a series of meetings starting next month. I entirely agree with those who have spoken so far about the need for speed; but they would also agree about the need to get things right. Our aim and the purpose of introducing the Bill is to make sure we have a suitable framework for the long term. That is why we are going to get it right, as well as getting it in place in the appropriate time.
Graham Stuart
I shall do so in due course. The detail of the secondary legislation will be constrained by and compliant with the WTO rules, but the rules that we set will be appropriate for the UK. Because they will be set out in secondary legislation there will be the necessary flexibility to allow changes to be made quickly, reflecting developments in best practice and WTO case law. I am sure that the Committee will agree that that is important, and that is why we do not think it is appropriate to include those matters in the Bill.
As to market distortions I reassure the hon. Member for Bootle that the legislation will enable the UK trade remedy system to account for particular market situations in anti-dumping cases. All major economies have a trade remedies framework that allows alternative methodologies to be used in investigations when the normal value of a good cannot be properly determined based on information from exporting countries. The UK will be no different. We have already discussed this with industry and will continue to do so, to get it right.
I recognise the underlying intent of amendment 62, to increase legal certainty for UK industry by including the requirement to act in accordance with the WTO Agreement on Safeguards. However, it is unnecessary. As members of the WTO we will be required to adhere to the provisions of WTO agreements, and we have been clear about the fact that we are committed to developing the detail of the UK’s trade remedy system in a way that is fully compliant with the obligations. By way of further reassurance, clause 28 of the Bill requires the Secretary of State and the TRA to have regard to their international obligations. On that basis I hope that the hon. Gentlemen can see that their concerns will be met by the approach that we shall continue to take, and that the amendment will be withdrawn.
Peter Dowd
I thank the Minister in good faith for his explanation. None the less, the Opposition take the view that there is a cumulative effect to the proposals. It is okay for the Minister to say that this is a framework and that we will add all the detail later, but there is a difference between a framework and a skeleton. This is not a framework but a skeleton. We must add meat to the bones of the skeleton, but we have not got that here today.
While I accept what the Minister is saying in good faith, we need to press this issue. We must make the point that we need more detail and more certainty. Of course, he might not be the Minister in the not-too-distant future—we do not know who the Minister might be. Therefore, while I have every faith in him, I am not sure whether I can say that about the future Minister.
Graham Stuart
It is a framework Bill—skeletal or otherwise—and the detail will come in secondary legislation, as is entirely normal for issues such as this. In response to the question from the hon. Member for Scunthorpe on when we will be ready to bring secondary legislation forward, we will do so as soon as possible. Evidently, that will need to be in time to ensure that the UK system is ready for when we exit the EU. That is the time constraint. We are working on this. We will engage in detail with industry, starting next month. We are bringing this forward as quickly as we can.
If the Opposition decide to press the amendment, that is fine, but cutting and pasting WTO agreements with which we will comply is not the same as having an appropriate system in place for the UK. This is not the right moment or place for these proposals, because this is framework legislation.
On why we should have secondary legislation, we need flexibility to adapt to developments in WTO case law and, if the Committee were to support the Opposition’s amendments, that flexibility would be removed. Changes in WTO case law are frequent: for instance, only last week there was a panel decision on article 2 of the WTO anti-dumping agreement. It is therefore important that we have the flexibility that only secondary legislation provides, so I ask the Opposition to think again.
Nic Dakin
Will the Minister confirm once more that the Government intend not to make things any more difficult for producers in terms of trade defence instruments and that, as the detail comes forward, people producing stuff in the UK will not be any worse off in future than under the current EU rules? I think that is what he is saying.
Graham Stuart
I would go further than that. By having a system that is entirely aligned with and attuned to the interests only of UK producers, we hope to have a better system than the one we have now. I cannot give firm timelines, because the TRA is not set up yet, but hopefully it will be speedier, more proportionate and balanced, absolutely scrupulous in observing WTO case law, flexible enough to implement it, better attuned to the needs of UK producers, and more effective at averting injury to them.
Grahame Morris (Easington) (Lab)
I thank the Minister for giving way and hope he will bear with me. Given the emphasis he is placing on the importance of secondary legislation, and the fact that, as he said a moment ago, the TRA has not been set up yet, has he had a chance to reconsider putting trade union representatives on the TRA?
Graham Stuart
It took the hon. Gentleman’s contribution finally to silence the hon. Member for Scunthorpe, who normally heckles throughout everyone’s address—[Interruption.]. As has rightly been said, that is harsh but fair.
I thank the hon. Gentleman for his question. The aim is that this should be an expert body, that the normal, rigorous civil service appointments process should be observed in its appointment and that we should have an organisation that has impartiality and effectiveness as its primary concerns, rather than being driven by political or indeed representative considerations. That is what we are planning to do.
Question put, That the amendment be made.
Jonathan Reynolds
I beg to move amendment 28, in schedule 4, page 58, line 33, after “contribution”, insert
“within the meaning of Article 1 of the WTO Agreement on Subsidies and Countervailing Measures”.
This amendment provides a definition of financial contribution by reference to the WTO Agreement on Subsidies and Countervailing Measures.
The Chair
With this it will be convenient to discuss the following:
Amendment 29, in schedule 4, page 59, line 24, at end insert—
“and shall be determined in accordance with Article 3 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994.”
This amendment provides that the meaning of injury for the purposes of Schedule 4 shall reflect the provisions of the relevant article of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994.
Amendment 30,in schedule 4, page 59, line 25, after “make” insert “further”.
This amendment is consequential on Amendment 29.
Amendment 31, in schedule 4, page 59, line 31, after “make” insert “further”.
This amendment is consequential on Amendment 29.
Amendment 33, in schedule 4, page 61, line 20, at beginning insert
“having regard to the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 and the WTO Agreement on Subsidies and Countervailing Measures”.
This amendment requires regulations determining what constitutes “negligible” and “minimal” to have regard to relevant WTO provisions.
Jonathan Reynolds
This is the second group of amendments on today’s amendment paper relating to schedule 4, on injury caused by dumping. Amendment 28 provides a definition of financial contribution by reference to the WTO agreement on subsidies and countervailing measures. Amendment 29 provides that the meaning of injury for the purposes of schedule 4 shall reflect the provisions of the relevant article of the agreement on implementation of article VI of the general agreement on tariffs and trade 1994. Amendment 30 is consequential on amendment 29, as is amendment 31. Finally, amendment 33 requires regulations determining what constitutes “negligible” and “minimal” to have regard to relevant WTO provisions.
I recognise that in the previous debate the Minister moved a little toward us in acknowledging some of the shortcomings of the Bill and the areas where there will eventually have to be clarity. These amendments concern one of the central issues regarding how we construct our future trade defence policy. In last week’s evidence session, it was made clear by representatives of UK industries that Brexit represents a potential opportunity for the UK to expedite its remedial processes when it comes to dumping and calculating injury—something that has already been referenced by all sides in the discussion today and by the Minister.
Industry also emphasised that, while assessing dumping margins can be relatively easy and straightforward, calculating injury margin needs much more involvement from industry and Government, and the results are not always so obvious. My hon. Friend the Member for Scunthorpe has again mentioned the steel crisis, and I would direct Members to read the Business, Energy and Industrial Strategy Committee’s transcripts from the previous Parliament on the crisis, which articulate very clearly the issues involved. It is of great concern to the Opposition that manufacturers and British industry are telling us that the Bill is seriously lacking in the detail they need to plan effectively for the future.
Members of this Committee, as well as its witnesses last week, have spoken at some length on the shortcomings of the proposed approach, not least that UK industry will be in the dark until all the statutory instruments that are required have been promulgated. As industry and those in many parts of the parliamentary process have repeatedly emphasised—in contrast to the Minister’s comments—it is highly unusual that secondary legislation is considered the appropriate means through which to establish the central tenets of our future trade defence policy. Indeed, it is considered normal practice by most of our major trading partners for these issues to be dealt with in primary legislation. Equally, because of the way in which the statutory instruments will be considered, this forum might well be the only opportunity to debate these measures and give them the proper scrutiny they demand.
The point of the amendments is to bring some of the detail and certainty that UK industry is seeking. Understandably, members of UK industries feel anxious voyaging into the unknown with only vague reassurances from Government. As my hon. Friend the Member for Bootle has said, there is no certainty about this Government’s future or that of the individual Ministers concerned. As the Manufacturing Trade Remedies Alliance has made clear—
The Chair
Order. Can I encourage the hon. Gentleman to be specific in relation to his amendments, as far as possible?
Jonathan Reynolds
I will be, Ms Buck.
The package of amendments offers a relatively straightforward solution to these issues by using a pre-existing, widely accepted set of terms to define injury. As referred to in amendment 29, the agreement on implementation of article VI of the general agreement on tariffs and trade 1994 is a set of World Trade Organisation rules, which already provides a blueprint to many major global economies. That will form a solid basis, which UK industry can use to start planning how it will adapt to the new post-Brexit landscape.
Complying with the requirements in the amendments will help to provide consistency following our exit from the European Union, and align us with existing trading standards in economies we seek to trade with globally. It makes little sense to delegate this decision to secondary legislation when we are already in a position to opt for a widely accepted and road-tested definition that would keep us aligned with potential trading partners. That would also have the major advantage of offering certainty to UK industries today—not years from now—on how the trading landscape will look post-Brexit, and allow them to plan accordingly.
I urge the Ministers to support this amendment. It is a relatively small commitment, which would help to bring consensus and certainty to the British economy.
Graham Stuart
These amendments seek to include specific reference to the relevant WTO agreements in the Bill. As I said in our earlier discussion, the Government have carefully considered the right balance between primary and secondary legislation. Where there are very technical provisions in a regime, those are usually set out in secondary legislation because they are very detailed. That is the case here, so we have taken powers to make the necessary regulations.
As a member of the World Trade Organisation, the UK will be required to abide by the WTO agreements. We intend fully to comply with these obligations, and the regulations will therefore reflect the detail of the WTO agreements. However, as I have said, clause 28 does require the Secretary of State, and the TRA, to have regard to international obligations, which should provide any reassurance needed.
It has been suggested that the injury margin is more complicated and harder to define than the dumping margin. We do not believe that that is the case. Both calculations are based on industry data and export data and involve a number of variables where the TRA would be afforded discretion to use its expertise in determining the appropriate approach.
Nic Dakin
Does the Minister recognise that the EU is moving away from that calculation and that, according to the evidence that was presented to us, that calculation involves greater bureaucracy but does not make a great deal of difference in the end, in terms of impact on prices?
Graham Stuart
I do not agree with the hon. Gentleman. From a technical point of view, I do not believe that the EU is moving away from its approach to injury. As I say, we are subject to the WTO. The Secretary of State has to have regard to international obligations, and the detail needs to go into secondary legislation. I therefore ask hon. Members to withdraw their amendment.
Jonathan Reynolds
I am grateful for the Minister’s response, which gave us some degree of detail that we have not had to date, but I think that there is a difference of opinion on some of the evidence we heard last week. In my notes, the Manufacturing Trade Remedies Alliance made it clear that the methodology of the assessment on how to decide appropriate trade remedies was, in its words, a key detail that it is missing. It said that that was relevant in particular to the application of the lesser duty rule and that it would welcome further clarity and legal certainty. With that in mind, I will press the amendment to a vote.
Question put, That the amendment be made.
Anneliese Dodds (Oxford East) (Lab/Co-op)
I beg to move amendment 32, in schedule 4, page 61, line 20, leave out from ‘minimal’ to end of line 33.
This amendment removes the need for a market share requirement to be met before the TRA may initiate a dumping or subsidisation investigation.
The Chair
With this it will be convenient to discuss the following:
Amendment 34, in schedule 4, page 61, line 45, leave out paragraphs (g) and (h).
This amendment is consequential on Amendment 32.
Amendment 35, in schedule 4, page 62, line 1, leave out ‘(d)’ and insert ‘(c)’.
This amendment is consequential on Amendment 32.
Amendment 36, in schedule 4, page 62, line 6, leave out ‘(d)’ and insert ‘(c)’.
This amendment is consequential on Amendment 32.
Amendment 37, in schedule 4, page 62, line 16, leave out ‘(d)’ and insert ‘(c)’.
This amendment is consequential on Amendment 32.
Amendment 38, in schedule 4, page 62, line 37, leave out ‘(d)’ and insert ‘(c)’.
This amendment is consequential on Amendment 32.
Anneliese Dodds
We tabled the amendments because the proposed market share requirements will not only put us out of step with comparable nations but stop action being taken to prevent uncompetitive disruption of infant industries. According to the Government’s proposals, applications to the TRA for an investigation will be subject to a UK market share threshold. As with so much in the Bill—as we have been discussing—we do not know how the threshold will be determined nor what its range is likely to be, let alone the actual value for different industrial sectors. The Government have given as their explanation for the measure the filtering out of cases with little chance of success. Yet, as already discussed in Committee, the Government have already set out a range of tests that must be passed before any action can be taken—tests that are already more stringent than is the case under EU legislation, and considerably stronger than those that the EU is moving towards.
I normally agree fully with every word that is uttered by my hon. Friend the Member for Scunthorpe, but I did not completely agree when he said that he was pleased to hear the Government saying, or hinting at least, that we would have a system at least as favourable to British industry as the existing one. With the different tests to do with economic interest or public interest, whether those applied by the TRA or the Secretary of State, that regime is far more stringent than that applied by the EU.
In addition, I am concerned that the measure proposed in the Bill could cause a lot of ambiguity and be problematic for the TRA. We are informed that the TRA must accept an application that meets the UK market share threshold, although of course both it and the Secretary of State can then decide not to proceed as a result of their overly stringent tests once they get into the investigation—but let us leave that aside. If an application does not meet the UK threshold but does meet WTO thresholds, the TRA may use its discretion as to whether to accept it. However, we can legitimately ask why the TRA should be put in a potentially difficult position, especially when legal action could be levelled against it by the company that is deemed to have engaged in dumping precisely because the TRA has used that discretion.
In addition, I do not understand why the UK has decided to adopt an apparently higher threshold of market share before applications may be accepted when, according to the stakeholders I have talked to, no other country seems to have adopted that approach. This is not about criteria within the investigation: it is about the criteria necessary before an investigation is allowed at all. As with the unique electoral system that led to the hanging chad problem in the US, there is a clear reason why this approach is so unique: it is not workable. The Minister rightly referred to learning from best practice, so it would be helpful for us to know which countries have that test in place before an investigation can be started and why it was believed that this is best practice. I have so far not been able to find any countries that operate such a system. If there are some, it would be wonderful to hear about them.
The Minister suggested in his previous remarks that, much of the time, all the Government are doing is simply transposing WTO requirements. However, the terms of the general agreement on tariffs and trade enable countries to take action, particularly to prevent uncompetitive disruption to infant industries. That could be prevented by this kind of test before an investigation can even be started. That process of uncompetitive disruption to infant industries is known as material retardation, which is quite a well-known concept when it comes to trade disputes and is interpreted quite broadly.
Rules within the Mercosur agreement—the South American trade agreement—state that countries can take measures, first, to ensure that infant industries can be established, but also that there can be, without uncompetitive disruption, the establishment of a new branch of production in an existing industry, the substantial transformation of an existing industry or the substantial expansion of an existing industry supplying a relatively small proportion of domestic demand. That is a very wide reading of what measures against material retardation can enable, and a broad reading of the concept of an infant industry as well. Those rules are already in action in the Mercosur agreement, so I hope the Minister will clearly explain why the UK should deny itself those kind of powers that other countries seem keen to avail themselves of.
I hope he will also indicate how he envisages that market share restriction working, which will be used even before investigations start. I read the “Trade Remedies Research” paper, produced by Van Bael & Bellis and Copenhagen Economics, which I am sure other Members have looked at as well. They looked in great detail at some of the methodological issues relating to the use of trade remedies and they indicated in detail the variety of considerations relevant to calculating market share that the EU has used once an investigation has opened—not as part of a test to determine the opening of an investigation but as part of determining the harm caused by dumping.
They indicated the potential drawbacks of, for example, setting a quantitative measure on the evolution of import volumes in relative terms—in comparison with domestic consumption—in order to determine how the market share of foreign exporters against UK industry has changed over time following dumped imports. That is because our market in the UK is small, and so domestic consumption can vary dramatically from year to year because the number of industry operators tends to be more concentrated.
There are some very difficult methodological issues here when it comes to calculations that might be involved in an investigation. We are talking about the TRA having to carry out calculations potentially with a similar level of methodological difficulty, even before an investigation is opened. Will the Minister indicate what kind of methodology he proposes to avoid those problems? Above all, will he please let us know why our country seems to be adopting this approach, which, as I say, I cannot find any analogue for in comparable nations?
Kirsty Blackman
I will say just a few things to follow on from the shadow Front Benchers on this. It is strange that market share is being used in this regard as something that will be taken into account. It is almost as if the TRA cannot be bothered to investigate a company if it does not have a certain market share. For that industry, and for manufacturers in particular, it does not matter what their percentage of market share is; what matters is the injury that is being done to them by dumping. Market share is not relevant, and I do not understand why it is included in the Bill. It may be relevant to the Treasury because it affects the tax take it gets from the industry, but it is not relevant to the protection we should be affording to the industry.
This proposal has geographical implications, given that these new goods will be made in the industrial north of the country. Those products may not meet the market share threshold, but they may be incredibly innovative and may improve productivity and make this country a better place to be. Those things will not be taken into account.
I have argued previously that if the fishing industry is decimated as a result of Brexit, that is a geographical issue for the affected communities. It does not have a massive implication for the Treasury’s tax take, but it does for those communities. I fear that this market share test is not only unnecessary, but has implications for the choices that communities make.
Kirsty Blackman
Absolutely, and conversely they are the ones that have been getting the most European funding, so the choice they thought they had to make because of the inequality and uneven economic growth in the United Kingdom will make them lose out in more than one way.
On the issue of new good and fledgling industries, we cannot predict what the world will look like in 20 years’ time. Who could have predicted the rise in the need for electric vehicle charging points, for example? If something suddenly becomes a thing, the effects cannot be predicted. For example, companies making paper straws in the UK are probably seeing their shares going through the roof. We cannot predict the market share of those companies and how quickly it will grow as a result of changes in the culture of the country. I do not think the market share test is appropriate. It is strange to have it in the Bill, and the Government need to rethink it.
Graham Stuart
I thank hon. Members for their contributions. I hope I can reassure them about the issues they raised. Perhaps there has been some misunderstanding, which I can clear up.
Amendment 32 and its consequential amendments 34 to 38 seek to eliminate a market share threshold that we have designed to make sure businesses have a transparent benchmark for judging whether their complaint is likely to be successful. On the question of why we have the threshold, an independent evaluation of the EU system suggested that the system should focus on producers’ market share as a way of informing inquiries.
I was also asked which other countries have the threshold. We understand that other countries consider whether cases are likely to result in measures at the point of applications, but they tend to use rather opaque systems. The market share threshold is intended to give industry greater certainty in a more transparent way about how the system will operate in this country. We are learning from experiences in other countries and are seeking to improve on them to the betterment of our system.
The provisions for the market share threshold fit with the industry’s calls for the TRA to focus on the cases that matter most. For instance, the British Ceramic Confederation said in its response to our White Paper that the TRA
“should not spend its time investigating vexatious complaints and needs to focus on cases where there is a real UK manufacturing interest.”
The market share threshold will be part of providing that.
Anneliese Dodds
I am grateful for the Minister’s comments. The additional information that he provides is useful, but he still has not made it clear whether any other countries operate such a restriction. I appreciate what he says about the potential opacity of other regimes, but we have not had a clear answer to that question. It may well be that some independent actors have written an evaluation of the EU system that says that such an approach should be implemented. However, as I understand it, the EU has not committed to moving towards such a system. It seems to be just the UK that is explicitly adopting it as a policy commitment, unlike any other country.
Graham Stuart
I thank the hon. Lady for that comprehensive intervention. As I said in reply to the hon. Member for Bootle, our aim is to make improvements. We want a better system that provides greater certainty for UK industry, and one that makes the TRA focus, as the industry has requested, on the cases of greatest import, not an opaque system as in other countries. The TRA may quickly respond to someone with a de minimis market share who comes forward with no real case and tell them that they have no chance, but what we are doing is creating a system that is much easier to understand and more transparent.
I hope the secondary legislation we implement will include other world firsts, too. So long as what we do is based on a proportionate, balanced approach that is fully compliant with the WTO and better tailored to the needs of British industry, I shall be proud to see us innovate. I am not afraid to innovate if it is in the interests of British industry and a better system. We should aspire to doing that.
Kirsty Blackman
The Minister argues that, in the case of a producer with a small market share in the UK, there may be a disproportionate effect on UK consumers. Given that an economic interest test takes into account the impact on consumers, is the market share test necessary?
Graham Stuart
For the reasons I have set out, I think the market share test is an eminently sensible part of our regime. I hope the Committee will agree.
Anneliese Dodds
I am grateful to the Minister for letting us intervene—he has been very generous in that respect. I say gently that I would have hoped for a little more impact assessment before we signed up to a system that is, to adopt the kind of language he used, unique in the world and a world-beating innovation, if we are indeed doing that.
The hon. Member for Aberdeen North made clear that vexatious complaints will be screened out by the economic and public interest tests, which are more stringent than those in the EU regime that we will take on board under the TRA.
The Minister referred to this process being an indication to firms of whether they have any hope of success, but it is not. We are not talking about a guideline. We are talking about a threshold that is a block. Yes, that block can be disregarded by the TRA, but it cannot be overruled by the complainant. That is the whole point. It is not just an indication. It is stronger than a guideline or a set of theoretical considerations. It is potentially a block on firms trying to seek redress through the TRA, which is unique in the world. I had hoped that we might have more explanation of that, despite the Minister’s valiant attempts.
Graham Stuart
Let me try to come back again. The share test comes at the beginning. We have to think about the order. The point is to provide transparency at the beginning of the process and to ensure, exactly as industry has asked, that we do not waste time on complaints, vexatious or otherwise, that have no chance of resulting in measures. That is the whole point of the test. It will be quickly applied and—the Opposition do not seem to have understood this—will have exemptions for infant industries. The system will provide a more transparent form of that which is routinely applied in other countries.
Question put, That the amendment be made.
Jonathan Reynolds
I beg to move amendment 39, in schedule 4, page 64, line 21, at end insert—
“Part 2A
Recommendations: general provisions
12A (1) The provisions of this paragraph apply to all recommendations made by the TRA under this Schedule.
(2) In any case where the TRA makes a recommendation to the Secretary of State, the TRA must, at the same time as making that recommendation, provide any relevant select committee of the House of Commons with—
(a) a copy of that recommendation, and
(b) an account of the evidence on which the TRA has based that recommendation.”
This amendment requires recommendations made by the TRA under Schedule 4 to be made available to relevant select committees of the House of Commons, along with an account of the evidence basis for the recommendation.
The Chair
With this it will be convenient to discuss amendment 70, in schedule 5, page 83, line 44, at end insert—
“Part 2A
Recommendations: general provisions
11A (1) The provisions of this paragraph apply to all recommendations made by the TRA under this Schedule.
(2) In any case where the TRA makes a recommendation to the Secretary of State, the TRA must, at the same time as making that recommendation, provide any relevant select committee of the House of Commons with—
(a) a copy of that recommendation, and
(b) an account of the evidence on which the TRA has based that recommendation.”
This amendment requires recommendations made by the TRA under Schedule 5 to be made available to relevant select committees of the House of Commons, along with an account of the evidence basis for the recommendation.
Jonathan Reynolds
These amendments have been grouped because they both refer to making recommendations by the new Trade Remedies Authority, and the evidential basis for those recommendations, available to the relevant Select Committees of the House.
Clearly, how the TRA operates is essential to our future trade policy. We know some things from the Bill about how it will operate—schedule 5 refers to the procedure that will be followed where an increase in imports of goods causes serious injury to UK producers, so there is more detail than we had previously—but the intention is for further detail about the interpretation of what constitutes a significant increase to be set out in secondary legislation. The TRA will also have considerable discretion in many areas of its operation.
Given the stage we are at with the Bill, we are being given a fairly limited set of options in terms of addressing the lack of accountability in key parts of how the framework will operate. These amendments would introduce an additional layer of scrutiny and consultation, which is needed to ensure that the interests of UK industry are properly represented. Select Committees provide vital checks and balances, and given their policy specialisms and ability to call relevant witnesses, they are best placed to scrutinise decisions by the TRA.
These amendments would not only allow us to address the democratic deficit, but provide a platform for engaging with the wide range of inputs needed fully to understand the implications of TRA decisions on different parts of our economy and different segments of UK industry. That might include the Transport Committee, the Treasury Committee, the International Trade Committee and, of course, the Exiting the European Union Committee. The amendments would provide an important democratic backstop to the new process that avoids concentrating too much power in the hands of the Secretary of State or the TRA. In the absence of greater detail in the Bill, I urge members of the Committee to support the amendments to bring some much-needed future accountability to the TRA and to our trade defence policy.
Graham Stuart
New paragraphs 12A and 11A, introduced by amendments 39 and 70, would require the recommendations made by the TRA under schedule 4 to be made available to relevant Select Committees of the House of Commons, along with an account for the evidence base of those recommendations. Let me begin by stating that transparency is one of the four design principles set out by the Government for the trade remedies framework. The inherent assumption of a lack of scrutiny implied by the amendments is simply untrue.
To protect the TRA’s status as an independent public body, its recommendations to the Secretary of State should not be subject to political influence before a decision to accept or reject them has even been taken. Those recommendations will be made on the basis of the framework set out in this legislation and underpinned by technical and procedural details to be set out in secondary legislation. Giving the Select Committee a role in that process will undermine the impartiality of the process—an impartiality which is supported by industry. Publishing the recommendation in advance of the decision by the Secretary of State could also further undermine impartiality by increasing lobbying of Ministers by the affected parties, and could also lead to unnecessary disruption of the markets affected.
The Bill provides for public scrutiny of both the TRA and the Secretary of State’s decisions. Whether the Secretary of State accepts or rejects the recommendation, the evidence base for the TRA’s recommendation will be made available to the public, as is required under the terms of the WTO agreements. Furthermore, if the Secretary of State rejects the TRA’s recommendation to apply measures, he or she must lay a statement before Parliament setting out the reasons for that decision. Parliament will then be able to hold the Secretary of State to account if it considers the reasons to be unsound.
Kirsty Blackman
It would be lovely if the Minister could explain how parliamentarians can hold Ministers to account if they make a written statement.
Graham Stuart
The hon. Lady has been a Member of this House for some time and will know that there is a series of means by which that can be pursued. Making a statement to the House provides the initial spur to start that scrutiny, if that is what the Select Committee or others decide. There are urgent questions, Adjournment debates, Backbench Business Committee debates—I will not list them all, as the hon. Lady is probably rather better on parliamentary process than I am. She will know that there is a huge number and they can all be used. Her Majesty’s Opposition or the SNP and their spokesmen have other means by which to raise the issue.
On that basis, I ask the hon. Gentleman to withdraw the amendment.
Jonathan Reynolds
I have two observations to make, the first of which is on impartiality. I would strongly refute that scrutiny by Select Committee would increase the partisanship or the partiality of the transparency of the process. The House’s Select Committees are to me the best example of cross-party working and cross-party accountability in the entire parliamentary process, and we should not shy away from using them when they can improve the process.
Secondly, there was reference to technical and political considerations. The decisions are not just technical. Of course they will draw on technical expertise and criteria, but they are inherently political. We saw that in the steel crisis, where frankly even with very clear technical evidence of dumping, there was a political point of view—not one I share—that the benefits to the UK of dumped steel outweighed the benefits of protecting the UK steel industry. That was not held by all parts of the Government, but certainly by some.
A transparent process that allows decisions to be analysed in that context would certainly add to the process, especially when we consider the lack of detail we have so far. I therefore press the amendment to a vote.
Question put, That the amendment be made.
Peter Dowd
I beg to move amendment 40, in schedule 4, page 65, line 2, leave out from “goods” to end of line 3.
This amendment removes the requirement for the TRA to be satisfied that requiring a guarantee meets the economic interest test.
The Chair
With this it will be convenient to discuss the following:
Amendment 58, in schedule 4, page 75, line 23, leave out from first “the” to end of line 24 and insert—
“economic benefits of the remedy to the United Kingdom industry within the meaning of paragraph 6 are significantly outweighed by the economic costs to the importers, users or consumers of the goods in the United Kingdom.”
This amendment provides greater specificity to the operation of the economic interest test.
Amendment 59, in schedule 4, page 75, line 29, leave out sub-paragraph (i).
This amendment removes the requirement to take account of the economic significance of affected industries and consumers in the United Kingdom.
Amendment 75, in schedule 5, page 93, line 22, leave out from first “the” to end of line 23 and insert—
“the economic benefits of the remedy to the United Kingdom industry within the meaning of paragraph 3 are significantly outweighed by the economic costs to the importers, users or consumers of the goods in the United Kingdom.”
This amendment provides greater specificity to the operation of the economic interest test.
Amendment 76, in schedule 5, page 93, line 28, leave out sub-paragraph (i).
This amendment removes the requirement to take account of the economic significance of affected industries and consumers in the United Kingdom.
Peter Dowd
This group of amendments relates to the economic interest test in the Bill. It requires the Trade Remedies Authority or Secretary of State to consider an economic interest test before recommending an anti-dumping remedy. That means that the TRA or Secretary of State must take account of a number of additional factors when considering whether to apply an anti-dumping remedy, to determine whether the remedy will be in the United Kingdom’s wider economic interest.
This is a highly unusual measure. The Manufacturing Trade Remedies Alliance describes the application of an economic interest test as “unique” among WTO users of trade remedies. There are few precedents for a functioning economic interest test, as only a handful of Governments conduct them. This provision is not in the WTO agreement or in EU regulation. Furthermore, the economic interest test in the Bill is very widely drawn, allowing the TRA or Secretary of State to introduce a wide range of additional macroeconomic considerations into the determination of a trade remedy.
It has been only two years since the former Chancellor of the Exchequer stood on a platform of building a Britain
“carried aloft by the march of the makers”,
yet now we are being carried off in a different direction, hence our amendment. Hon. Members on both sides of the Committee will note that, despite that, we have not taken the step of seeking to remove the economic interest test entirely, to bring the UK into line with well worn national agreements and regulations. Instead, in the spirit of conciliation, we have tabled a number of amendments that would clarify the exact uses of an economic interest test and ensure that the Secretary of State could not overwrite the democratic process entirely.
Amendment 40 would remove the economic interest test from the consideration of the Trade Remedies Authority at the preliminary stage of determination. Part 2 of schedule 4 gives the TRA powers to make an initial, provisional recommendation to the Secretary of State that dumping may have occurred and that therefore all importers of the goods in question should be required to give a guarantee in respect of any additional amount of import duty that would have been applicable, or may be applicable, subject to further investigation. The Bill requires the TRA to have considered first whether that requirement to guarantee is necessary to prevent injury and, secondly, whether it would meet the economic interest test.
As amendment 40 makes clear, we do not believe that it is appropriate for the economic interest test to be inserted at this early stage, when provisional remedies are being required ahead of a later full and final determination. The addition of an economic interest test at this point in the process places a large additional burden on the TRA when only provisional guarantees are being requested. It is impractical for the TRA to be expected to carry out a full economic interest test at this stage. It could also bear down on the speed at which all necessary provisional remedies are applied. That relates to the points about speed and pushing things on, as the Minister would like. Slowing the process will allow injury to producers to continue unchecked, reducing the efficiency of the system as a whole.
Furthermore, the application of the economic interest test at this stage in the remedy process goes well beyond WTO rules, which require only a consideration of injury. This would leave the UK with a higher bureaucratic threshold to rectify injury than most nations we hope to trade with. Surely the Minister must agree that a central ambition of any Trade Remedies Authority is responsiveness and agility, but this measure flies in the face of what he told us earlier. Our amendment removes the burden of the economic interest test being placed on the TRA at this early stage in proceedings to allow it to take swift provisional measures pending further investigation, and so that we can act quickly as and when necessary to protect our industries.
Amendment 58 addresses part 6 of schedule 4, which sets out the economic interest test in more detail. We hope to address the balance of priorities that the economic interest test attempts to juggle to give proper due to the interests of producers and, subsequently, consumers, workers and so on. The point was made in the evidence session that producers are also consumers, who will no longer be able buy anything if they lose their jobs due to dumping injury.
This amendment clarifies the exact circumstances in which the economic interest test is considered not to have been met. There is little detail in the Bill regarding what those circumstances might be. Instead, sweeping powers are given to the Secretary of State to make up his or her mind as he or she sees fit. That is in keeping with the Government’s wider approach to the Bill.
This amendment clarifies that the economic interest test will be assumed to have been met so that a remedy can be applied, unless the
“economic benefits of the remedy to the United Kingdom industry… are significantly outweighed by the economic costs to the importers, users or consumers of the goods in the United Kingdom.”
It attempts to clarify the balance of forces that should weigh up any judgment in that regard. That is a completely reasonable addition to the Bill, which merely adds necessary detail where it is lacking, and gives all parties concerned clarity about how different interests will be considered. I hope the Minister will accept this amendment, which will clearly improve the Bill without cutting across the established roles of different actors in the process being developed.
Amendment 59 looks a few lines further down the list of factors that the TRA or Secretary of State should take into account when
“considering whether the application of an anti-dumping remedy or anti-subsidy remedy is not in the economic interest of the United Kingdom”.
Our amendment seeks to remove the first provision that states that the TRA or Secretary of State should consider the economic relevance of
“affected industries and consumers in the United Kingdom”.
As it stands, schedule 4 gives preference to large enterprises over small and to established sectors over new. Without our amendment, the Secretary of State could stamp out a small, growing sector or extinguish an embryonic area of British entrepreneurship because they deemed it not of “economic significance” to the UK. That would be a travesty. It seems to be an incredibly short-sighted approach to the UK economy and, if I may say so, strangely interventionist from a party that claims not to believe in the state picking winners. By extension, it cannot justify allowing the state to forcibly create losers.
It is highly unusual and inappropriate to allow the Secretary of State to write off an infant industry or area of consumption based on a crystal ball prediction of its future significance. Amendment 59 removes this dangerous sub-paragraph from the Bill to ensure that Secretaries of State keep their minds on likely impacts across the different interests at play, rather than gambling with the UK economy. Again, this is not a radical step, but a sensible reduction in the scope of the powers being handed to the Secretary of State, tabled in the name of democracy and, for the Minister, good economic management, of which the Government are losing sight.
Amendment 75 addresses one of the strangest lines in the Bill: sub-paragraph 2 of schedule 5 part 5, on page 93. For a Bill with very little detail, it is incredible that the Government managed to include a sentence of such baffling circularity. It bears repeating, so the Minister may hear it read aloud. It is reminiscent of Danny Kaye in the film “The Court Jester” saying:
“The pellet with the poison’s in the vessel with the pestle; the chalice from the palace has the brew that is true.”
It is well worth watching, and this pales into insignificance—I am sure Danny Kaye would do a better reading of it than I. It says:
“The economic interest test is met in relation to the application of a safeguarding remedy if the application of the remedy is in the economic interest of the United Kingdom.”
It is remarkable—I think it is wonderful—that somebody produced that phrase. Perhaps the Minister would like to elaborate on it, while using the words “economic interest”, “application” and “remedy” just once each. I eagerly await his explanation of the useful addition that the clause makes to an otherwise rather slim Bill.
Nevertheless, amendment 75 may help the Minister by adding the wording that I tried to add to schedule 4 of the Bill through amendment 58. Amendment 75 is therefore effectively a consequential amendment, in that it adds much-needed clarity to the balance of interests that the Secretary of State should weigh up when assessing the economic test in schedule 5, to match the amendment that we have set out in schedule 4 already.
Similarly, amendment 76 removes the requirement that the Trade Remedies Authority or the Secretary of State consider
“the economic significance of affected industries and consumers in the United Kingdom”.
Again, we seek with the amendment to adjust schedule 5 of the Bill to align it with the changes that I outlined in my comments on schedule 4, this time to reduce the scope of the Secretary of State to predict the future success or otherwise of sectors of the British economy, or to preference large-scale industries over emergent or otherwise vital forces that might just end up giving our ailing, low-productivity economy a much-needed boost.
In summary, as hon. Members on both sides can see, we are engaging with this vital section of the Bill fully and constructively, to ensure that the right balance of interests is properly considered when trade remedies are investigated, and to construct a properly efficient process for doing so. I look forward to the Minister engaging with all the amendments on similarly constructive terms, and I hope that Committee members will carefully consider supporting them to ensure the best level playing field for UK industry, fair regard to producers and consumers alike, and an agile and efficient means of remedying any disputes that might arise.
Graham Stuart
Let me start by explaining that the objective of the economic interest test is to ensure that measures are in the best interests of the UK. It ensures that measures are not imposed where they might have disproportionate impacts on wider groups such as downstream industries or, as the hon. Gentleman rightly said, consumers. Let me take the amendments in turn and set out why they would undermine our objective of a balanced and proportionate trade remedies framework.
With amendment 40, the Opposition seek to remove the application of the economic interest test before the imposition of provisional anti-dumping and anti-subsidy measures. It would mean that the test is considered only at the final stage of imposing definitive measures. Given that provisional measures can have profound wider economic impacts, we believe that the test should be met before they can be imposed, just as before definitive measures. That ensures consistency between the two stages of the investigation, and operates in the same way as the existing Union interest test in the EU’s regime, thus providing continuity for UK businesses.
I understand the concerns of UK industry that the inclusion of the test at the provisional stage could delay the application of measures. However, that will not necessarily be the case. In practice, the TRA will have the ability to gather evidence on the economic impacts of applying or not applying measures in parallel, rather than sequentially, to other aspects of the investigation.
Graham Stuart
What I can confirm is that our system will be much more transparent. It will allow those who apply to it, or might be affected by it, to be clearer about how the system will work. That form of transparency is one of the fundamental principles on which we have built this structure.
Peter Dowd
That was a valiant attempt to show why the Government are taking a hammer to crack a nut.
Peter Dowd
I am not privy to the details, but I believe there will most probably be more tests. I think those tests will be more bureaucratic and will lead to inflexibility. By the time we get around to designing them, they will be more complicated than they need to be. The Government’s position, as I have indicated, is to take a hammer to crack a nut. They are not fleet of foot enough on this issue. I have tried to lay out where we think the Government should give careful consideration. Though I hear what the Minister says, and his concern about transparency, this is so transparent that we can see through the Bill. That is the problem: there is nothing there. Though the Minister has tried to reassure us, I think he has missed the point. The Government are going into potentially dangerous territory and poking their fingers into all sorts of places that they do not necessarily need to poke into. We will therefore push the amendment to a vote.
Question put, That the amendment be made.
Peter Dowd
I beg to move amendment 41, in schedule 4, page 66, line 1, leave out from “dumping” to “in” in line 2.
This amendment removes the reference to the amount of the subsidy as an upper limit on the anti-dumping amount in the recommendation under paragraph 14.
The Chair
With this it will be convenient to discuss the following:
Amendment 42, in schedule 4, page 66, line 6, leave out from “dumping” to end of line 7.
This amendment is consequential on Amendment 41.
Amendment 43, in schedule 4, page 66, line 7, at end insert—
‘(3A) The provisions of sub-paragraph (3) are subject to the provisions of sub-paragraphs (3B) and (3C).
(3B) If the TRA finds that the dumping has been fully or partially caused by market distortions affecting the prices of raw materials or other industrial inputs paid by the exporting producers, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (3)(a).
(3C) If the TRA finds that there is an inadequate level of social and environmental protection in the exporting country, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (3)(a).”
This amendment provides for the anti-dumping amount to be the margin of dumping in certain specified circumstances.
Amendment 44, in schedule 4, page 66, line 8, leave out paragraph (4) and insert—
‘(4) For the purposes of sub-paragraph (3)(b) the TRA shall, in determining the amount which it is satisfied would be adequate to remove the injury described in that provision, take account of all elements of the material injury being caused to the UK industry, including, but not limited to, the impact of reduced sales volumes, price suppression and curtailment of investment.
(4A) Regulations may make further provision for the purposes of sub-paragraph (4).”
This amendment makes provision on the face of the Bill for the main factors to be considered in determining the amount for the purposes of paragraph 14(3)(b).
Amendment 49, in schedule 4, page 69, line 18, leave out from “dumping” to “in” in line 19.
This amendment removes the reference to the amount of the subsidy as an upper limit on the anti-dumping amount in the recommendation under paragraph 18.
Amendment 50, in schedule 4, page 69, line 22, leave out from “dumping” to end of line 23.
This amendment is consequential on Amendment 49.
Amendment 51, in schedule 4, page 69, line 23, at end insert—
‘(4A) The provisions of sub-paragraph (4) are subject to the provisions of sub-paragraphs (4B) and (4C).
(4B) If the TRA finds that the dumping has been fully or partially caused by market distortions affecting the prices of raw materials or other industrial inputs paid by the exporting producers, the anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (4)(a).
(4C) If the TRA finds that there is an inadequate level of social and environmental protection in the exporting country, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (4)(a).”
This amendment provides for the anti-dumping amount to be the margin of dumping in certain specified circumstances.
Amendment 52, in schedule 4, page 69, line 24, leave out paragraph (5) and insert—
‘(5) For the purposes of sub-paragraph (4)(b) the TRA shall, in determining the amount which it is satisfied would be adequate to remove the injury described in that provision, take account of all elements of the material injury being caused to the UK industry, including, but not limited to, the impact of reduced sales volumes, price suppression and curtailment of investment.
(5A) Regulations may make further provision for the purposes of sub-paragraph (5).”
This amendment makes provision on the face of the Bill for the main factors to be considered in determining the amount for the purposes of paragraph 18(4)(b).
Peter Dowd
I thank the organisations that sent in further written evidence today; that was very helpful. The TUC, among others, gave us information that helps with the amendments. Amendments 41 to 44 and 49 to 52 concern the removal of a mandatory lesser duty rule for estimating the injury of state-sponsored dumping. This is a potentially contentious area, and we have to get the balance right. Schedule 4 rightly defines dumping as imported goods priced below their normal value, where “normal value” means the domestic price, or another value if that is appropriate. I touched on this earlier. This definition recognises that the injury margin of domestic prices here does not always reflect the actual injury to UK manufacturers when dealing with goods from distorted economies such as Russia or China.
UK manufacturers are rightly concerned about leaving the methodology for these specified cases to regulation created by the Treasury and/or the Secretary of State, with little parliamentary input. The Opposition’s amendments on the trade remedies and Trade Remedies Authority seek to address this concern and ensure that the methodology by which the TRA calculates the injury caused to manufacturers by dumping sufficiently protects UK manufacturing and industry. I refer hon. Members to the TUC document, which gives the examples of aluminium foil, aluminium road wheels, coated fire paper and continuous filament glass fibre production. One of the biggest concerns that UK manufacturers have with the trade remedies Bill is outlined in schedule 4—that is, the introduction of a mandatory lesser duty rule. That requires the calculation, in dumping investigations, of the level of injury to domestic industry, in addition to the level of dumping. The duties correspond to the lesser of the two indicators, which means that they might not necessarily properly reflect the damage to British industry. That is important in a whole range of areas. My hon. friend the Member for Scunthorpe referred to this in relation to steel; and we heard about ceramics. It is important that we get this right. In other words, it is relatively straightforward to calculate the cost of dumping, but less easy in relation to injury, with a full investigation, which may be an appropriate action. I think that Dr Cohen was pretty clear about that in her evidence.
As witnesses from key industries, including steel, ceramics and chemicals, pointed out last week, the best estimate of the distortion to trade is the dumping and subsidy margin. The creation of a mandatory lesser duty will result in lower duties that in some cases may not reflect the actual injury. It is labour-intensive for the investigating authority and does not reflect the full—
Trade Bill (Fifth sitting)
Tuesday 30th January 2018
(6 years, 10 months ago)
Public Bill CommitteesRead Full debate Trade Bill 2017-19 View all Trade Bill 2017-19 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 30 January 2018 - (30 Jan 2018)
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
Barry Gardiner (Brent North) (Lab)
I beg to move amendment 5, in clause 2, page 2, line 13, leave out subsections (3) and (4) and insert—
“(3) Regulations under subsection (1) may make provision for the purpose of implementing a free trade agreement only if—
(a) the other signatory (or each other signatory) and the European Union had ratified a free trade agreement with each other immediately before exit day, or
(b) where the regulations are made before exit day, the other signatory (or each other signatory) and the European Union have ratified a free trade agreement with each other on the day the regulations are made.
(4) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement other than a free trade agreement only if—
(a) the other signatory (or each other signatory) and the European Union had ratified an international trade agreement with each other immediately before exit day, or
(b) where the regulations are made before exit day, the other signatory (or each other signatory) and the European Union have ratified an international trade agreement with each other on the day the regulations are made.”
This excludes from the scope of section 2(1) those international trade agreements agreed between the UK and a third country where the corresponding agreement between the European Union and that third country has been signed but not ratified.
The Chair
With this it will be convenient to discuss the following:
Amendment 9, in clause 2, page 2, leave out line 33.
This would remove the Henry VIII power allowing for the modification of primary legislation that is retained EU law.
Amendment 10, in clause 2, page 2, line 40, at end insert—
“(7A) An ‘international agreement that mainly relates to trade, other than a free trade agreement’ means a strategic partnership agreement or mutual recognition agreement that is ancillary to a free trade agreement as defined in subsection (7).”.
This would define international trade agreements that do not fall within the category of a “free trade agreement” as defined under subsection (7).
Barry Gardiner
I am delighted to see you in the Chair, Ms Ryan. I look forward to the Committee proceeding at a rapid pace under your guidance. I am tabling amendments 5, 9 and 10, in my and my colleagues’ names, as on the amendment paper.
We are now talking about the implementation of the new international trade agreements to be negotiated between the UK and those third countries that already have an agreement with the European Union. The Government are seeking to appropriate to themselves the power to make regulations to implement those new agreements without any scrutiny by Parliament. I cannot state it better than the House of Commons Library briefing paper, which states that the Bill
“seeks to minimise Parliament’s role”
in this regard, in that it will make all secondary legislation under clause 2(1) subject to a negative resolution procedure only.
The rationale behind this attempt to sidestep due democratic process is that the trade agreements that the EU had previously negotiated with the third country in question had already undergone scrutiny when they were prepared for ratification—that is the argument the Minister used last week when we debated this. By the Government’s sleight of hand, he would say there needs to be no parliamentary scrutiny of any new UK trade agreement because that job will already have been done on the earlier agreement negotiated by the EU.
The Minister was particularly keen to point out that we were suggesting that all the levels of scrutiny that took place at the EU would be done away with. I think he thought he was trapping us when he asked us to agree that a good level of scrutiny had taken place, and that we should allow these measures to go through on the nod because that scrutiny had already happened. We reject that argument, and we were pleased to register that business representatives who gave oral evidence to the Committee agreed with us. The Committee will recall that.
The new trade agreements are not only legally distinct, as the Government have admitted, but may well include substantial new obligations, which will have been through no process of scrutiny whatever. That is why we demand a new approach to these agreements in subsequent amendments to schedule 2, where scrutiny is addressed. However, the provisions of clause 2(3) and (4) go even further, in that they allow the Government to sidestep scrutiny of not only those new UK agreements that are set to replace existing ones, which have been through the full scrutiny process prior to ratification, but UK trade deals that replace EU agreements, which have not even been through the process of ratification. Our amendment speaks to that extraordinary attempt to undermine democracy still further, the significance of which might be demonstrated if I give the Committee an example.
The economic partnership agreement between the EU and Japan was finalised last month. Negotiations were concluded on 7 December last year, and the text of the agreement is currently undergoing the double process of what is called legal scrubbing and translation into the official languages of the EU, so that it can proceed to signing in 2018. The agreement will subsequently undergo the due process of ratification by Japan and within the EU, including parliamentary scrutiny by the European Parliament. However, that process will not be completed until later in 2019, if experience is any guide, and therefore after the point at which the UK is no longer a member of the EU.
Japan is also one of the countries with which the Government have established a trade and investment working group. That working group held its first meeting in Tokyo during November of last year, and is tasked with advancing the trade and investment relationship of the two countries, with the eventual aim of signing a UK-Japan trade agreement at some point in the coming years.
According to the Bill, any future UK trade deal with Japan will be counted as a roll-over agreement, and will therefore escape parliamentary scrutiny altogether, because the EU and Japan will have signed a trade agreement during 2018—that is, before the UK leaves the EU. Note that that will be the case even if the future UK-Japan deal bears no resemblance to the EU-Japan economic partnership agreement. As stated earlier, the Bill makes no requirement for the future UK deal to match the EU’s agreement in any way, shape or form; the Bill requires only that the other country and the European Union were signatories to a free trade agreement before Brexit takes effect. The regulations to implement those new obligations will be subject to a negative resolution procedure, which is the effective negation of parliamentary scrutiny, as the Government would have us consider the new UK-Japan deal simply to be a roll-over or a grandfathered agreement.
I would like to draw attention to the oral evidence provided last Tuesday by Dr Lorand Bartels of the University of Cambridge, who spoke to exactly that issue. Dr Bartels drew particular attention to the forthcoming trade agreement with Japan, and pointed out that
“there is a fundamental difference in international law between a signed and provisionally applied agreement and a ratified agreement.”—[Official Report, Trade Public Bill Committee, 23 January 2018; c. 42.]
The Government would do well to heed that distinction. I hope that the Minister might accept our amendment and that he will see it, in a friendly spirit, as one that might improve the Bill.
Without the amendment, we are in danger of effectively granting the Government carte blanche to do what they like to secure a new UK-Japan deal. That would be a major concern to businesses and workers up and down the UK. Japan is a major player on the world stage, and Japanese companies are important investors in our economy, so the obligations that we, as a nation, undertake in relation to those companies are critical to the future of some of our most dynamic industries. Are the Government really telling us that we, as parliamentarians, should have no right to scrutinise those obligations?
Faisal Rashid (Warrington South) (Lab)
Despite the fact that the Government have continued to argue that there is no need for parliamentary scrutiny in the Bill because existing deals have been subject to sufficient scrutiny in the European Union, does my hon. Friend agree that that is not the case here and therefore that it is vital in the interests of the British people that we secure such an amendment?
Barry Gardiner
I am grateful to my hon. Friend for his intervention because he reinforces the very point that I am trying to establish. Despite the processes that are currently in place for scrutiny of trade deals as they proceed through Europe, and ultimately through the European Scrutiny Committee and through the House under the Constitutional Reform and Governance Act 2010 procedure, we have here a situation in which a deal that was going to be concluded between the EU and another country can proceed to be signed, but not implemented. Then, in the lacuna—that is, the space between that signature and our leaving the EU—we could be confronted by the Government with a completely different set of trade relations. The trade agreement could be totally different, yet, under the Bill, the Government would have the power to sign and implement it simply because they had already signed a previous agreement before we had left the EU. That cannot be the right procedure for what could be completely new issues under that future agreement.
In one sense, the amendment is a modest one, given the seriousness of the issue it addresses. It merely seeks to exclude from the antidemocratic provisions of the Bill any regulations stemming from treaties such as a future UK-Japan trade agreement, where the correspondent EU agreement will have been signed but not yet ratified, along with all the scrutiny that ratification requires.
Other EU trade agreements could fall into this same category: the EU-Vietnam free trade agreement, the text of which is also being prepared for signing at some point this year; the EU-Singapore free trade agreement which has been initialled but held up by internal EU discussions as to whether it is a mixed agreement or exclusive EU competence, leading to the European Court of Justice ruling on this issue in May last year; and, potentially, some of the economic partnership agreements still to be finalised between the EU and different groupings of African, Caribbean and Pacific states, which were criticised so trenchantly by Professor Alan Winters of the UK Trade Policy Observatory in his oral evidence to the Committee last week. Also in this category is CETA, the comprehensive economic and trade agreement between the EU and Canada, which has been signed but not yet fully ratified, as it is a mixed agreement requiring ratification in each of the EU member states, in addition to the centralised EU institutions of the Council of Ministers and the European Parliament.
Finally, the amendment tightens up the language of subsections (3) and (4) by requiring not just that the EU and the other signatory or signatories should have ratified trade agreements, prior to Brexit, but that they should have done so with each other. The Bill as it stands simply says that they must have signed “a” trade agreement; it does not say that they have to have signed it with Japan—with the corresponding party. This is ridiculous. The Minister is looking confused. If he wants to intervene, I would be happy to give way to him on this point because it is material.
The Minister for Trade Policy (Greg Hands)
I thank the hon. Gentleman for allowing me to intervene. I am a little confused about his position on CETA. If CETA is not yet ratified by all the EU28 countries, the amendment, if it became law, would effectively prevent the UK from transitioning CETA to be a UK-only agreement. I know that the hon. Gentleman is opposed to CETA, and he represents a minority view within his party. However, the great majority of Labour MPs welcome CETA and voted in favour of it. It is also something that has already taken effect, so the effect of his amendment would be to take us out of the provisions of CETA that have already been in place and been provisionally adopted since September.
Barry Gardiner
The Minister, of course, chose not to respond to the point I allowed him to intervene on because of his confusion.
Barry Gardiner
I am happy to address the Minister’s point and have set out the Labour Front-Bench position very clearly. He should know that the provisions of the amendment do not do what he has claimed they do. What it says is that there must be proper parliamentary scrutiny. He is denying precisely the opportunity for that to happen when a treaty has been signed but not yet ratified. The point of the amendment is to ensure that proper scrutiny can take place and that ratification can have taken place to ensure that.
Faisal Rashid
On the point about CETA, does my hon. Friend share my concerns about the implications of bringing in certain provisions of the deal and not ratifying—for example, the investor-state dispute settlement provisions? The key point is that there will not be sufficient scrutiny or consultation or an impact assessment carried out.
Barry Gardiner
My hon. Friend pre-vents me—I think that is the sort of Latin term: he goes before me. He picks up a theme I was about to come to. The ISDS procedures have been a major concern of not just parliamentarians but many other people in this country and across Europe. Any hon. Member who says that his postbag and email have not reflected that has simply not been examining them carefully enough.
On my point about the requirement to sign “a” trade agreement, clause 2(3) states:
“Regulations under subsection (1) may make provision for the purpose of implementing a free trade agreement only if—
the other signatory (or each other signatory) and the European Union were signatories to an international trade agreement immediately before exit day”.
It does not specify that it must be the same agreement, and stating the need for a treaty “with each other” would clarify that, which is what the amendment seeks to do. There is no great confusion, but there might be some because the clause is ambiguous.
Amendment 9 speaks to the first of two Henry VIII powers. Those powers are the most egregious example of the power grab that characterises the Bill, despite the extraordinary spectacle of the Secretary of State using the letters page of The Guardian to claim the opposite—a travesty I detailed on Second Reading and which, for reasons of time, I do not wish to reprise here. For the record, though, I draw attention to paragraph 2 on the very first page of the delegated powers memorandum that accompanies the Bill, which states, in plain English:
“The Bill contains 6 individual provisions containing delegated powers. Two of these, clauses 2(1) and 7(3), include a Henry VIII power.”
I am still waiting for the Secretary of State to correct the record that he so carefully muddied previously. Amendment 9 simply seeks to remove the first of those two Henry VIII powers.
Ms Ryan, I am glad that your grouping of amendment 9 with amendment 5 has enabled me to speak to it now, because it follows nicely on from my comments on the UK-Japan trade agreement. It is bad enough that talks towards a trade agreement should have been initiated behind closed doors by a secret working group—no agendas, no minutes, no access to any documentation, no website to keep Parliament or the public abreast of what was being decided in our name—but at the end of that charade, a set of formal negotiations, still in secret, determined what obligations we as a country might or might not be saddled with for a long time.
Faisal Rashid
Does my hon. Friend agree that if the Government are certain of their ability to roll over existing agreements, there is surely no need for the Henry VIII powers?
Barry Gardiner
My hon. Friend is entirely right. The Henry VIII powers show that the Government also realise that it is not simply replica provisions that are being rolled over but, in fact, new agreements that may contain substantially different clauses. Because of that, they need powers to be able to progress those agreements. The Committee tried to address that during its sitting last Thursday afternoon but the Minister has been reluctant to take the matter on board, even when pressed on how he thought, given the Government’s red lines, he would be able to roll over our current agreement with Norway on the free movement of people, and that with Turkey on the relationships we have through that country’s agreement with the EU customs union. The Minister has failed comprehensively to address those points. It would be interesting if he were to do so when he responds to this group of amendments, but I fear my hon. Friend might languish in hope rather than expectation of the privilege of hearing such a response.
Greg Hands
It is a pleasure to serve under your chairmanship, Ms Ryan. Let me reassure you that, by exit day, the Government aim to have ratified all EU mixed free trade agreements that are currently provisionally applied. They include, for example, the EU-Canada CETA agreement and the Southern African Development Community co-operation in accreditation.
Barry Gardiner
If it is the Minister’s intention, as he says, to do what the amendment asks him to do, namely to apply these clauses only to agreements that have been ratified—and he says that they will all have been ratified—what problem does he have with accepting the amendment?
Greg Hands
The answer to that is straightforward. Although it is our intention to have ratified the agreements, that does not necessarily mean that they will have been ratified by the other EU27 countries. That is the important thing. I will come on to why the hon. Gentleman’s amendment would put at risk agreements that the UK is already party to and that UK businesses are already benefiting from.
We must remember that EU free trade agreements that contain areas of shared or member state competence must be ratified by all 28 member states before they come into force. As we know, that process can take considerable time. We drafted the clause 2 power so that signed EU free trade agreements fall within its scope. That will ensure that it can be used to implement agreements to replace those that have been signed, and which may have been provisionally applied but are yet to be ratified by the EU or the partner country.
Many such agreements are benefiting businesses and consumers as we speak. In other words, they have already taken effect. I know that the hon. Gentleman is opposed to CETA, for example, but we believe that it has benefited UK businesses considerably since it was provisionally applied and took effect in September. I know that he wants to throw away those benefits, so I remind him that most of his party sensibly sees the merits that CETA provides this country. Under his amendment, we would be unable to implement a free trade agreement that falls within this category, which would risk a cliff edge in any trading relationships covered by such an agreement.
To take another example, the UK ratified the EU’s Andean FTA with Colombia and Peru in 2014. In 2016, UK trade with those countries had a value of more than £2 billion. However, that FTA is still awaiting ratification by both the European Union and a number of EU countries. If that is still the case by exit day, the amendment would prevent the clause 2 power from being used to implement a transitioned FTA with Colombia and Peru, resulting in a likely reduction in trade flows between the UK and the Andean countries.
Let me turn to a few points that the hon. Gentleman raised elsewhere. He asserted that the agreement has to be signed by both parties. Clause 2(3), which relates to free trade agreements, states that in order for the Government to be able to use the power when implementing an agreement with a partner country, both the EU and that country must have signed a free trade agreement before exit day. In other words, both must have signed the same agreement.
Greg Hands
I think the hon. Gentleman said it was ambiguous, but the Government’s intention is clear. We have all laid it out frequently: to transition the effects of the 40-plus EU FTAs, not to renegotiate new agreements. He mentioned the cases of Norway and Turkey. As I laid out at considerable length at the Select Committee on International Trade last week—I know two of his colleagues are members of the Committee—the situation will depend largely on the UK’s future relationship with the European Union, which is a matter for the current negotiations, as Norway, Turkey and Switzerland’s relationships are very much linked to whatever our future relationship with the EU might be.
Barry Gardiner
Of course, the Minister is entirely right to say that the nature of the agreements that we conclude with those countries would depend on our future relationship as we negotiate our withdrawal from the EU, but the point is that this Bill is supposed to be simply rolling over the existing agreements. The Minister has made a great deal of the fact that we want no change and are simply rolling over what exists into what comes afterwards. That is the trap that he has set for himself, and he must extricate himself.
Greg Hands
I will just repeat what the Secretary of State said on Second Reading: the Bill is designed to be robust to the different cases of where the future UK-EU relationship might lead us following the negotiations.
The hon. Gentleman mentioned Japan. In the small number of cases where the EU seeks to establish an FTA, it might be too late to go through conventional EU scrutiny here, and there are also our agreements that will now be sole EU competence. Also, they might not necessarily happen through the current EU scrutiny process. We will consider this in due course, but we are committed to Parliament having its say. Earlier this month we published a response to the trade White Paper, and the Government will consider views as we develop proposals regarding the role of Parliament in future trade agreements.
If we are to avoid trade disruption, we need to make sure that signed EU agreements that are not yet ratified by the EU, including the examples I have given, such as CETA, the Andean agreement and the partner country agreements, fall within the scope of the Bill, otherwise we will jeopardise a considerable part of the current trading relations that benefit this country so much. Contrary to what the hon. Gentleman says, the amendment would not improve the Bill. It would actually threaten a great number of our existing trading arrangements.
It is worth remembering that a delay in ratification by another EU member state has no real relevance to the content of an agreement, or indeed to UK scrutiny of it. It is merely a reflection of that country’s domestic situation. To allow such a state of affairs as that suggested in the amendment, and to cause disruption to UK businesses, would be profoundly unsatisfactory.
Matt Western (Warwick and Leamington) (Lab)
Does the Minister agree that, as Alan Winters said in the evidence session when talking about business and concerns about continuity, the issue is not only transparency and scrutiny, but a recognition—we are calling for this in the amendment—that some changes required in any trade agreement will be technical or substantive? There is a need to understand the degree of what is substantive, and that is not determined anywhere. That is what we and the witnesses—business or academic—are calling for. There is nothing in the Bill that ensures the scrutiny of what is substantive and what changes should be allowed.
Greg Hands
I would say two things to the hon. Gentleman. By the way, I cannot remember whether he was in favour of CETA or against it, or what his individual position was within the Labour party on some of these agreements.
Greg Hands
Of course—the hon. Gentleman was not yet elected at that time.
The Government’s intention is clear. This is a technical roll-over: there will not be substantive changes to the agreement. However, that is not what this amendment deals with. The amendment talks about making sure that all deals that have yet to be ratified are outside the scope of the Bill. Our position is clear: agreements that have been signed but not yet ratified should be within the scope of the Bill.
Faisal Rashid
The Minister mentioned a few times proper parliamentary scrutiny of future trade agreements but, clearly, the provision confirming that there will be parliamentary scrutiny in future should not be in the Bill.
Greg Hands
I am absolutely clear that this Bill relates to the transition of our existing trade agreements. How we approach future trade agreements will be a matter for future consideration. I mentioned earlier that we will look carefully at the responses to the consultation. Of course, if the hon. Gentleman has views, we are keen to hear them. Indeed, we will be seeking views from across this House on what Parliament’s views on these matters might be, but that is entirely a matter for the future.
Amendment 10 would clearly create an unacceptable risk that agreements essential to trade could not be effectively provisioned. If the members of the Committee are concerned about the scope of this power, please let me reassure them that, as I referred to earlier, we have already set out in clause 2 restrictions on the scope of the power.
Given these constraints, the existing drafting of the power, and our clear and firm assurances that this power is not intended to be used for the implementation of future trade agreements, it would be strange to include this amendment, which sets out the required procedure for future trade agreements. I therefore ask the hon. Gentleman to withdraw amendment 5.
Barry Gardiner
I am not prepared to withdraw and I propose that we move to a vote.
Question put, That the amendment be made.
Judith Cummins (Bradford South) (Lab)
I beg to move amendment 6, in clause 2, page 2, line 29, at end insert—
“(4A) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement only if the provisions of that international trade agreement do not conflict with, and are consistent with—
(a) the provisions of international treaties ratified by the United Kingdom;
(b) the provisions of the Sustainable Development Goals adopted by the United Nations General Assembly on 25 September 2015;
(c) the primacy of human rights law;
(d) international human rights law and international humanitarian law;
(e) the United Kingdom’s obligations on workers’ rights and labour standards as established by but not limited to –
(i) the commitments under the International Labour Organisation’s Declaration on Fundamental Rights at Work and its Follow-up Conventions; and
(ii) the fundamental principles and rights at work inherent in membership of the International Labour Organisation;
(a) women’s rights and are in accordance with the United Kingdom’s obligations established by but not limited to the Convention on the Elimination of All Forms of Discrimination Against Women;
(b) children’s rights and are in accordance with the United Kingdom’s obligations established by but not limited to the Convention on the Rights of the Child;
(c) the United Kingdom’s environmental obligations in international law and as established by but not limited to—
(i) the Paris Agreement adopted under the United Nations Framework Convention on Climate Change;
(ii) the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES); and
(iii) the Convention on Biological Diversity, including the Cartagena Protocol on Biosafety; and
(d) the sovereignty of Parliament, the legal authority of UK courts, the rule of law and the principle of equality before the law.”
This would ensure that international trade agreements do not conflict with the provisions of international laws or conventions on human rights and the environment, or with the rule of law.
The amendment is designed to apply to regulations implementing all UK trade agreements, of whatever sort. It is a high-level amendment that sets out our trade policy in the proper context of respect for human rights, environmental sustainability and the rule of law. I hope therefore that the Government will have no difficulty in accepting it as a friendly amendment.
The casual observer might think it bizarre that a trade agreement could endanger human rights. Luckily, help is at hand. For those members of the Committee who have not read it, I heartily recommend the comprehensive report of the United Nations independent expert Alfred de Zayas for the UN Human Rights Council, dated 12 July 2016, in which he enumerates the many ways in which trade agreements may indeed infringe on human rights and sadly have done so in the past.
I will not take the Committee through the whole report, but suffice to say that de Zayas examines the threat posed to human rights by international trade and investment across not only civil and political rights, but economic, social and cultural rights such as the rights to work, health, education and one’s own culture. In all cases, de Zayas offers examples of where international trade and investment activities can threaten the enjoyment of human rights. He warns against creating any new agreement that might exacerbate the harm that has already been done as a result of failure to pay proper heed to the nexus between trade and investment, and human rights.
I will draw out one recommendation in the UN independent expert’s report, because it is so utterly pertinent to our discussion of the Bill. His first and foremost recommendation to Parliaments around the world states:
“No parliament should approve trade agreements without exercising oversight functions and examining the compatibility of the agreements with human rights treaty obligations in the light of impact assessments.”
That sentence might usefully be read out, I suggest, at the beginning of every sitting of the Committee and at any subsequent debate on trade policy held by this House.
The amendment seeks to ensure that future UK trade agreements will never be able to undermine human rights in the ways that Alfred de Zayas describes so powerfully for the UN Human Rights Council. In particular, proposed new sub-paragraph (c) aims to establish a proper hierarchy in cases of conflict between human rights law and the treaty obligations of international trade agreements, so that human rights law will always take priority. That is in line with the Vienna declaration and the programme of action adopted by the world conference on human rights on 25 June 1993.
Sub-paragraph (c) also speaks to the basic legal principle of pacta sunt servanda, namely in this case that states are obliged to fulfil their human rights treaty obligations in good faith and should never enter into any trade or other commercial agreements that would undermine or in any other way render impossible the fulfilment of their human rights treaty obligations.
Our amendment goes further, however, in light of the fact that we have higher-order principles that are not related to human rights alone. We also require the UK’s international trade agreements to be consistent with international humanitarian law, which is the body of law governing the conduct of war, so that there can be no question of the UK entering into any agreement with a trading partner that might undermine such a critical pillar of the international order.
One obvious example of what happens when that principle is ignored can be found in the ongoing difficulty caused at European level by Morocco’s attempt to include the fishing rights of the Sahrawi people in its trade agreement with the EU. The trading relationship between the two partners has been critically undermined as a result of the European Court of Justice 2016 ruling that Morocco has no right to negotiate a fishing agreement with the EU covering the waters of the occupied Western Sahara, a territory that the UN has confirmed must be granted the right to self-determination, but where the Sahrawi population has lived under Moroccan military occupation for more than four decades.
Just this month, the ECJ advocate-general publicly stated that the EU fisheries deal with Morocco should be declared invalid because of its failure to accord with international humanitarian law. I am sure that, like us, the Government would not wish any future UK trade agreement to fall into a similar trap.
Faisal Rashid
Trade deals often impact a wide range of public policy areas. For example, a deal done with a foreign state can impact on the provision of services such as transport. The powers outlined in the Bill could potentially remove a duty on service providers to make reasonable adjustments for people with disabilities. According to Liberty, that would make access to transport more difficult for one in five of the UK population. Does my hon. Friend agree that, as we build the foundations for our future trade policy—I understand that the Minister argues with that—it is vital that the legislation contains provisions that protect such human rights, which are incredibly important for a huge number of people?
Judith Cummins
It is incredibly important to include an ethical dimension to any human rights legislation in the Bill. We also require all future UK trade agreements to be consistent with the sustainable development goals adopted by the UN General Assembly in September 2015.
The importance of those goals needs no further elaboration but may be a useful point on how the world’s poorest countries have been marginalised from the gains of global trade over the past 40 years. Although emerging economies such as China have clearly been able to use the export opportunities of a globalised economy to develop into leading actors in many fields of trade and investment, the countries that are home to the bottom billion, as the poorest have been called, have been left behind.
That is precisely what the World Bank’s former research director, Paul Collier, warned of in his best-selling book “The Bottom Billion”, where he concluded that reliance on trade is more likely to lock yet more of the bottom billion countries into the natural resource trap than to save them through export diversification.
Mr Mark Prisk (Hertford and Stortford) (Con)
I do not agree with the hon. Lady’s last argument. Millions of people have been lifted out of abject poverty because of trade. I would like to make clear that this is a friendly amendment, as the hon. Lady described it, for future trading agreements, rather than the agreements that the Minister has referred to.
Judith Cummins
It is important that we establish the principles of human rights within our trade agreements.
Mr Prisk
I entirely agree with the principle that human rights are important. I just want to be clear whether we are talking about existing agreements being transitioned, as dealt with by the Bill to which the hon. Lady has tabled her amendment, or, as her remarks indicate, about future agreements some way in the distance.
Judith Cummins
I am talking about both because human rights are the basis of principle, not a point, so my proposal covers both.
To prove the point, the world’s least developed countries saw their share of global merchandise fall still further, to under 1%, in 2015. Africa has seen its share of global trade cut by a half over the past 30 years. It is our task to ensure that the poorest countries can benefit from trade and investment. To that end, the sustainable development goals included three specific targets on trade, set out for all countries to follow, which include promoting a universal, rules-based, open, non-discriminatory and equitable, multilateral trading system under the World Trade Organisation.
Anna McMorrin (Cardiff North) (Lab)
In his speech to the World Trade Organisation in Buenos Aires, the Secretary of State reaffirmed his commitment to trade as a main tool for development, which is fantastic. The Government should therefore be keen to support the amendment, which reaffirms the UK’s commitment to the provisions of the SDGs, human rights, workers’ rights and environmental protections, which are key elements of development, growth and stability, as the Secretary of State said.
Judith Cummins
I absolutely agree. The sustainable development goals include the capacity to increase significantly the exports of developing countries, with a view to doubling the least developed countries’ share of global exports by 2020. The SDGs can also allow for timely and lasting duty-free and quota-free market access for the least developed countries, consistent with WTO decisions, including by ensuring that preferential rules of origin applicable to imports from the least developed countries are transparent, simple and contribute to facilitating market access.
The Labour party made a manifesto commitment to guaranteeing the world’s least developed countries continued duty-free and quota-free access to the UK market, post-Brexit. I am pleased that the Government agreed to match that pledge, but we need to go considerably further if we are to ensure that our trade policies really contribute to the realisation of the sustainable development goals. That is why this is such an important part of the amendment, and one that I am sure the Government will support.
One of the most powerful ways to ensure that international trade leads to poverty reduction and enhanced life chances is to ensure that working people benefit fully from the opportunities it offers. To that end, we wish to ensure that all new trade agreements are fully consistent with the UK obligations on workers’ rights and labour standards, starting with the International Labour Organisation’s declaration of fundamental rights at work, and its eight core conventions covering freedom of association, forced labour, child labour and discrimination. However, simply linking to those conventions is far from sufficient, as has been seen in so many cases where trade agreements have led to an undermining of other labour rights. We require a deeper commitment to principles and rights at work that are inherent in the UK’s membership of the ILO, to ensure that there can be no race to the bottom in labour standards as a result of the UK’s new international trade agreements.
Again, I have no doubt that the Government will share our desire to keep labour standards high. The Secretary of State for International Trade, who has not always been known as a champion of workers’ rights, made the case in a debate on exiting the European Union and global trade in the House on 6 July last year. I should be pleased to quote him at length, which is not something that I find myself doing too often:
“There are those who would make the case for a Britain with lower regulatory standards and fewer protections in place across the economy for the environment, for workers and for consumers. Let me tell the House that Britain will not put itself at the low-cost, low-quality end of the spectrum, as it would make no sense for this country economically to do so, nor morally would it give us the leadership we seek. I believe there is no place for bargain-basement Britain.”—[Official Report, 6 July 2017; Vol. 626, c. 1365.]
Encouraged by the Secretary of State’s new-found identity as a defender of high standards and workers’ rights, the Government will, I am sure, have no trouble in supporting this part of the amendment.
Equally, all new trade agreements must be consistent with women’s rights, not least because it has often been women workers who have suffered most in the international trading system.
Integration into global supply chains promised much to women workers in countries where they had not previously enjoyed other economic opportunities. In Bangladesh, for instance, formal employment in the export-oriented garment industry has provided millions of women workers with a regular source of independent income, which has in turn allowed them to enhance their social status and political participation. When done properly, trade can be a source of empowerment, yet many of those working women have found themselves trapped in dead-end jobs characterised by poverty wages and dangerous working conditions. That is a particular threat to workers at the bottom of global value chains producing goods for distant retailers that have ultimate power and control over the conditions under which their suppliers operate. The ILO has noted that all too often trade via global supply chains
“tends to generate economic benefits… (in terms of high productivity), but not necessarily for workers”.
For far too many women in the global economy, the promise of empowerment is eclipsed by the grim realities of exploitation. Trade agreements must be consistent with children’s rights, with the UK’s environmental obligations, and with the provisions of other international treaties ratified by the United Kingdom. Surely the Government will agree with us on these points. They must respect CITES—the convention on international trade in endangered species of wild fauna and flora—as well as the convention on biological diversity. None of these are idle concerns. The European Commission’s official impact assessment for the Transatlantic Trade and Investment Partnership recognises that under every potential outcome, the proposed EU-US agreement would create what it called dangers for natural resources and for the preservation of biodiversity.
Iain Stewart (Milton Keynes South) (Con)
The hon. Lady refers to TTIP and new trade deals; I am sorry for pressing this point, but they are not the point of this Bill. I agree with her on all the standards that she wishes to see in place, and I do not want Britain to race to the bottom, but that is not the point of the Bill; it is for future Bills. Please could we stick to the roll-over agreements that we are talking about in this Bill?
The Chair
Order. I remind the hon. Gentleman that it is for me to guide hon. Members on whether they are in scope.
Judith Cummins
I remind the hon. Member for Milton Keynes South that the opening line of the Bill says that its aim is to
“Make provision about the implementation of international trade agreements”
per se. It is about principle, and about the fact that the Bill is a legal entity in itself.
Judith Cummins
It is the Trade Bill. These principles, including on human rights, should be held dear; if they are not held dear by Government Members, they are at least by Opposition Members. Environmental degradation has just been dismissed as collateral damage when it comes to international trade agreements. That is no basis on which to construct a new trade policy for a United Kingdom.
Hannah Bardell (Livingston) (SNP)
The hon. Lady makes an excellent speech. Does she agree that we all have deep concerns about fair trade? There is already a creep in supermarkets looking at fairly traded products, rather than Fairtrade products, and we will see significantly more of that if the Bill passes without amendment. Given that many of our constituencies are Fairtrade towns, that should be of significant concern to all of us.
Judith Cummins
I thank the hon. Lady for that intervention. Fair trade should absolutely be a key element of any Bill that deals with trade.
Barry Gardiner
My hon. Friend quite properly reminds the Committee that the amendment is in scope—otherwise it would not have been selected; the Chair would have ruled it out of scope—because of the words at the front of the Bill. The amendment would of course have an impact on the roll-over agreements, as the Government call them, which are legally distinct, new agreements. If these provisions were put into law, they would apply to all new agreements that we completed in the future. I do not doubt that many Government Members would be happy to see included these provisions about human rights, equality and the rights of children—things that David Cameron, when he was Prime Minister, was keen to negotiate as one of the leaders on the SDGs. Would Government Members accept that the amendment is not only in scope, but could have a positive effect on future conclusions of trade agreements?
Matt Western
I thank my hon. Friend for being so generous. To amplify that point, I think it was Nick Dearden who, during the oral evidence sessions, spoke about modern trade deals and the huge opportunity presented to us. It is almost a no-brainer to include the things listed in the amendment. There is almost an assumption that they should be included, and that is why we are putting forward the amendment. These are modern trade deals. We have an opportunity to update the arrangements. This is a simple amendment.
The Chair
For clarity, when we vote, we will vote on the amendment as on the amendment paper. It is perfectly in order for the hon. Member for Bradford South to discuss the principles that she wishes to see applied in the Bill.
Judith Cummins
Finally, our amendment demands that the UK’s international trade agreements be fully consistent with the legal authority of UK courts, the rule of law and the principle of equality before the law. It does not take Sherlock Holmes to deduce that the amendment is designed to prevent the undermining of our legal system by the introduction of investor- state dispute settlement mechanisms in any future UK trade agreement.
ISDS represents an extraordinary transfer of power to foreign investors who gain exclusive rights, unavailable to any domestic investor, to sue host Governments in their own private judicial system. The investment protections they are granted go far beyond what they could be entitled to expect in any of their domestic courts. That has in turn spawned a massive industry of trade lawyers and hedge funds keen to speculate on the massive gains to be made from suing a country over any new rule or regulation that might be construed as being unfair to multinational companies operating there.
There have been more than 800 ISDS cases brought by foreign investors against their host countries. Some Governments have been forced to back down from introducing perfectly reasonable social or environmental measures. In the first ISDS case brought against Germany under the energy charter treaty, the Swedish power company Vattenfall sued in relation to its new coal-fired power plant outside Hamburg. The authorities were forced to drop the environmental conditions designed to protect the water quality of the River Elbe. In the infamous case brought against Canada under the ISDS provisions of the North American Free Trade Agreement, the US company Ethyl successfully sued the Canadian Government over their ban on the use of the fuel additive MMT. The ban had been introduced on public health grounds to guard against the inhalation of particles of manganese, which is known to be a neurotoxin. When the ISDS tribunal ruled against Canada’s procedural defence, it settled the claim by paying $13 million to Ethyl, rescinding the ban and issuing a public apology.
The prospect of being on the receiving end of such an attack generates its own regulatory chill, dissuading countries from upgrading their regulatory regime for fear of being sued for hundreds of millions of pounds in front of wholly unpredictable tribunals where the adjudicators often turn out to be working out as counsel for their corporate clients at the same time. The inclusion of ISDS or its equivalents in the most controversial bilateral trade agreements of recent years has been one of the key factors behind the loss of legitimacy and public support for international trade in general. We would do well to address that fact at this juncture.
The EU Trade Commissioner Cecilia Malmström was not exaggerating when she complained that ISDS had become the most toxic acronym in Europe. It turned her TTIP dreams into a nightmare, and it will do the same for any future UK trade agreements that seek to include it. There is absolutely no justification for the introduction of ISDS in any trade or investment agreement negotiated for the UK, and there is no need for it either. The UK holds more foreign investment stock than any other EU member state and boasts a higher score than any other European country on the index measuring the quality of judicial processes. Foreign investors can have full confidence in the UK judicial system and can rely on our domestic courts for any redress they seek as a result of unfair treatment, just as we do.
The previous coalition Government commissioned an official cost-benefit analysis of the prospect of extending ISDS rights to North American investors at the outset of the TTIP negotiations in 2013. The report they received is still well worth reading. It found that there would be no benefits to the UK economy from introducing ISDS, only costs. With that rebuke ringing in our ears, I trust that the Government will vote in favour of the amendment, as they should.
Mr Prisk
I strongly support the hon. Lady’s point about the value of human rights and the importance of workers’ rights and environmental standards, not only as we trade abroad but in how we deal with our domestic politics. That is very important. I am sorry that, at the tail end of her point, she started to suggest that one side of the House somehow does not agree with that. In fairness, there is a range of views across the spectrum, but the principles about human rights and workers’ rights and so on are there.
I cannot support the hon. Lady’s amendment, not because of the values that she talked about at some length but because, in her own words, the amendment seeks to change any future trading agreement. On a point of principle, I do not think that is something the Committee has the power, or is in the position, to do. On that principle, I will vote against the amendment, and I hope other Members do the same.
Greg Hands
I thank the hon. Member for Bradford South for her interesting and wide-ranging speech. I wholly agree with her strong comments on human rights and the UK being a leader in that space and the wide range of fields referred to in the amendment. In fact, I think all Conservative Members wholly endorse that.
However, I assure the hon. Lady that the amendment is unnecessary. The UK has always sought to comply with international law, and we will continue to uphold our strong commitments to human rights and labour and environmental standards around the world, as well as to the sustainable development goals, gender rights, disability rights, endangered species, fighting climate change and so on. The process of exiting the EU will not alter that position, and we will still be bound by our commitments under international law. Both the Secretary of State and I stated in the Chamber on Second Reading that our aim in undertaking the transition programme is to seek continuity in the effects of existing trade agreements. This is not an opportunity to renegotiate the terms of those agreements, which have already been scrutinised by Parliament.
The hon. Lady referenced least developed countries. I remind her that, despite her warm words, she voted against the Taxation (Cross-border Trade) Bill on Second Reading, which is currently being considered in another Committee and which enshrines a system of trade preferences for developing countries as we leave the EU, to make sure that those powers are in place for the UK to offer unilateral trade preferences. Unfortunately, if her vote on that Bill had been the majority view in the House earlier this month, the UK would not have a system of trade preferences for developing-world countries as we exit the EU.
The amendment is unnecessary, particularly in relation to our compliance with international law.
Faisal Rashid
The Government recently published a 25-year plan for the environment, committing the UK to:
“Leave a lighter footprint on the global environment by enhancing sustainability and supporting zero deforestation supply chains.”
Does the Minister agree that it is vital that the Bill is amended to ensure that the Government can meet that commitment, and to ensure that trade policy does not result in a reduction in environmental standards and protections or in an unacceptable, unsustainable global footprint?
Greg Hands
Let me be absolutely clear: there is no intention to reduce environmental standards. In fact, the point of the 25-year environment plan was to enshrine this country’s commitment to the environment over a very long period of time. I heartily commend that plan, but it is not part of today’s Bill. I am happy to underline that we will, of course, remain compliant with international law. On the basis of that assurance, the broader applicability of international law, and the UK’s commitments in all such areas, I ask the hon. Member to withdraw the amendment.
Greg Hands
I will, of course, take an intervention from the hon. Member for Warwick.
Matt Western
My constituency is Warwick and Leamington. They get funny about that in my area.
Based on my humble experience, I do not think we have the same kind of reputation for environmental safeguards as certain other countries—our history is weak in that area. One of the reasons for tabling the amendment was to ensure that those sorts of standards are included, and that we are putting that forward for our own protection, as well as the offensive interests of other Governments. The Minister may have a different view from mine. I understand that he has lobbied in Brazil on behalf of certain oil giants such as BP and Shell, so he will take a different stance. I believe that it is an important issue, which is why we tabled this important amendment.
Greg Hands
I thank the hon. Gentleman for that late but wide-ranging intervention. Let me try to deal with each of his points. On Brazil, it is quite clearly on the record that the discussions were to ensure a level playing field for UK companies, not to change Brazilian domestic requirements in a way that would harm the environment in Brazil.
Secondly, we have an exemplary record on the environment over the last seven years. The UK was a leader in the Paris agreement and the negotiations behind it, as the shadow Secretary of State will know only too well—he takes a keen interest in that and is even the party’s spokesperson. When it comes to recent regulations such as the banning of microbeads and efforts to prevent plastics from entering the environment, the Government have an exemplary record. On that basis, I ask the hon. Member for Bradford South to withdraw her amendment.
Judith Cummins
We will push the amendment to a vote.
Question put, That the amendment be made.
Bill Esterson (Sefton Central) (Lab)
I beg to move amendment 7, in clause 2, page 2, line 29, at end insert—
“(4A) Regulations under subsection (1) may make provision for the purpose of implementing an international trade agreement only if the provisions of that international trade agreement do not in any way restrict the ability—
(a) to make public services at a national or local level subject to public monopoly;
(b) to make public services at a national or local level subject to exclusive rights granted to private operators; and
(c) to bring public services at a national or local level back into the public sector for delivery by public sector employees.”
This would ensure that international trade agreements cannot restrict future decisions in respect of the delivery of public services.
It is a pleasure to serve under your chairmanship, Ms Ryan. Amendment 7 seeks once and for all to exclude public services from the remit of any future UK trade agreements. That nut has proved extremely difficult to crack in all of the multilateral and bilateral international trade negotiations that the UK has been involved with to date. Given the object lesson we have just been taught by the collapse of Carillion and the deep uncertainty it has caused in relation to the outsourcing of public services, we are more determined than ever to get it right for the future.
Service trade negotiations were introduced to the multilateral trading system through the general agreement on trade in services. GATS was part of the package of multilateral agreements negotiated in the Uruguay round of global trade talks, which took place between 1986 and 1994 and led to the creation of the World Trade Organisation. Each country submitted a schedule of GATS commitments detailing the level of liberalisation it would offer to other WTO members on a sector-by-sector basis and across the four different modes of service delivery—namely, cross-border supply, consumption abroad, commercial presence and movement of natural persons. That was done by what is known as positive listing, which means that only sectors put forward for liberalisation would be subject to the GATS market access and national treatment provisions. EU member states were able to register their own national limitations to the levels of liberalisation listed for each sector, either by withholding sectors from liberalisation entirely or by attaching national conditions to the opening of their markets. That means that, across the 160 service sectors, the EU’s schedule of commitments runs to more than 540 pages in length.
Services have become an important element in the bilateral trade negations that have proliferated since the demise of the WTO’s Doha round. Contrary to what is often heard in the media, the comprehensive economic and trade agreement between the EU and Canada—CETA—included the most far-reaching commitments to services trade liberalisation ever made by the EU. They were made by a negative listing, which means that only sectors specifically listed for protection from liberalisation would be excluded from the deal’s market access and national treatment provisions. That is commonly known as the “list it or lose it” approach, and it makes for a much more extensive liberalisation outcome than the positive list approach that has been used in multilateral services negotiations.
In all of those negotiations, there has been considerable concern about the potential for public services to fall foul of WTO rules on monopolies, competition and market opening. To that end, the original GATS text included an exemption for services
“supplied in the exercise of government authority”.
That exemption has been carried over into most other bilateral agreements. We sometimes hear people who are new to this issue claiming that this provides a carve-out for public services. However, the exemption for services supplied in the exercise of governmental authority is closely defined to mean only services that are supplied on a non-commercial basis and without any competition from the private sector. There is consensus among all trade policy experts that it is a carve-out not for public services, but only for specific state functions, such as the judiciary, the army or the police.
The detailed paper on the subject published by Professor Markus Krajewski notes that academics and trade policy practitioners alike now accept that most public services, including social, health and educational services, as well as network-based and universal services, are not covered by the exemption clause. The EU agrees. The European Commission has confirmed that public services such as the NHS are not protected by the governmental authority exemption. The relevant passage from the Commission’s proposal to modernise the EU’s treatment of public services in future EU trade agreements states:
“The scope of the GATS includes services which may be considered by each Member to be ‘public services’. A wide variety of so-called public services, including certain activities relating to education, healthcare, postal, telecommunications, waste collection, water provision, electricity, transport, etc as they exist today in many countries, including in most EU Member States will have certain commercial aspects and may be provided to some extent by private operators on a competitive basis. Where this is the case, they would normally fall within the scope of the GATS as representing ‘tradable’ services.”
Faisal Rashid
Does my hon. Friend agree that modern-day international trade agreements extend into a wide range of public policy making and it is therefore essential that our Government maintain the capacity to deliver public services?
Bill Esterson
That is absolutely right. It is at the heart of amendment 7 that our Government and this country retain the right to decide who runs vital national services. Our concern from the body of evidence over the years—I have started to run through where some of those concerns come from—is that there is doubt about whether that will continue to be possible.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I am fully behind the principle of the amendment. Scotland still leads the way in terms of Scottish workers being employed under public ownership. We are looking at a public sector energy company and a public sector bid to run the ScotRail franchise. I completely support that public sector ethos. As was mentioned, the Bill is supposed to be about existing trade agreements being rolled over into UK law. Is the hon. Gentleman saying that even under existing EU trade deals, these public service operations are at risk, meaning that that would be a concern when any one of those deals was rolled over?
Bill Esterson
If the amendment is agreed, we are making sure that there is no prospect of there being a problem or concern about any of these things arising. I am glad that the hon. Gentleman mentioned some of the important elements of public services that are still in the public sector in parts of the United Kingdom, because in the Labour manifesto last year that is certainly what we envisaged for the whole country.
We believe that those with concerns are right to be concerned, given that the European Commission has said the following about including public services in the multilateral services regime in its proposal on modernising the system:
“Indeed, it is important for the EU that GATS does cover public services, as the EU, for whom services represent 70% of the overall economy, and where EU harmonisation has led to the liberalisation of former public monopolies in areas such as telecoms and postal services, is also the world’s largest exporter of services and seeks access to other markets.”
That is why public reassurances and best endeavour commitments from Ministers are not the issue here. Legal certainty and absolute exemption are required, which again answers the point made by the hon. Member for Kilmarnock and Loudoun. Amendment 7 seeks to exclude, once and for all, public services from the fear of being trapped by world trade rules, by prohibiting Ministers passing regulations to implement the trade agreement if that agreement in any way restricts the ability to keep public services in public hands or to bring them back into public hands once they have been outsourced.
In the wake of the disastrous collapse of Carillion, I would hope that the common sense of the amendment is so overwhelming that it will receive support from the Government. We cannot have a situation where the outsourcing of public services to the private sector might end up entangled in trade rules so that future Administrations find themselves in any way restricted in bringing those public services back into the public sector for delivery by public sector employees.
When the Secretary of State gave evidence to the International Trade Committee last February, he was invited by my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) to repeat the words:
“The NHS is off limits in any future trade deal.”
In reply, the Secretary of State stated:
“Let me tell you, as the person who will be in charge of negotiating that, it would not be happening on my watch.”
Let us hope that the Secretary of State’s commitment will encourage the Government to vote in support of the amendment and to ensure that our NHS and our other vital public services will never be pawns to be bargained away in international trade negotiations.
Alan Brown
It is a pleasure to serve under your chairmanship, Ms Ryan. I will expand briefly on the point I made in my intervention. We fully support the principles behind amendment 7. Scottish Water is still in public ownership in Scotland. Caledonian MacBrayne ferries recently went out to tender and there was a public sector bid, so that remains run by the public sector. Going forward, the Scottish Government are looking at the ScotRail franchise possibly coming into the public sector, as well as public sector energy companies. Of course, we all value the different national health services across the constituent countries of the United Kingdom.
The hon. Member for Sefton Central touched on Carillion, which is certainly a good example of how private does not always equal better. We have now seen the latest east coast main line fiasco—Stagecoach and Virgin were able to walk away and not honour their commitment to the public purse in the franchise moneys they were meant to pay. It is clear that that service has been run successfully in the public sector before and there is no reason why that could not be done again. We would certainly like to see more rail franchises operated by the public sector.
For those reasons, we would welcome these protections being added to the Bill. I would like to think that the amendment is not really required, but there does sometimes seem to be a confused position in the Labour party. The leader of the Labour party, the right hon. Member for Islington North (Jeremy Corbyn), has suggested that we cannot be in the single market and have rail nationalisation. This is not correct, given how many national rail companies operate in the UK and run UK franchises. Clearly, we can have nationalisation and be in the EU single market.
Barry Gardiner
Perhaps the hon. Gentleman will allow me to clarify. I believe that the contention is not that we cannot have a nationalised industry as a member of the single market; it is that once the sector has been liberalised, it then becomes very difficult to take it back under national control. That is the point my party’s leader was making, not the one he suggests.
Alan Brown
I thank the hon. Gentleman for that clarification. I would still contend that there is a confused viewpoint regarding the single market and how it aligns with membership or otherwise of the EU. Again, where the rail franchising system in the United Kingdom has been liberalised, clearly there is no impediment to the Scottish Government making a public sector bid. That proves that it can happen within the EU single market.
In conclusion, I welcome any commitment to strengthen the public sector ethos and public sector ownership, and I will be interested to hear what the Government have to say.
Greg Hands
As I have mentioned, the aim of continuity means that this exercise will not be used as a back-door way to alter how the UK delivers public services. I make it clear to the Committee that the protection of public service delivery is written into many EU trade agreements and they already include safeguards to protect EU country Governments from being forced to privatise their services. That protection has worked for 20 years.
I will turn to some of the individual points that have been raised. The hon. Member for Sefton Central talked about the agreement on government procurement. Just to be clear, the GPA operates on a positive list basis—that is, only areas listed by GPA members in their GPA schedules are covered by the GPA’s obligations.
Secondly, the hon. Gentleman will know, as I do, that negotiations on the trade in services agreement are ongoing at the WTO, but are not making a great deal of progress. The UK’s position, as it currently stands, will be represented in those discussions by the European Union.
Faisal Rashid
If the Government will not support the amendment today, will the Minister provide assurances to the Committee and to the British people that the Bill will not put vital public services, such as the NHS, at risk of piecemeal privatisations that are ultimately detrimental to those who rely on those services?
Greg Hands
We have been clear that many EU trade agreements presently provide those protections and we have been clear that this exercise of transitioning existing EU free trade agreements will not be used for any back-door attempt to do anything to the NHS that would prevent our right to regulate domestically for the NHS. This party has a proud record of defending and protecting the national health service, and that will continue.
Barry Gardiner
Does the Minister recall that during the drafting of CETA, while Germany put a clear exemption into the agreement’s text that it would not allow any privatisation of its health service in that way, the UK failed to do so? One reason the ancillary document—the interpretative document—was necessary was to make that clear, but that document was not binding in law. As such, the Government do not have a good record on this, do they?
Greg Hands
The hon. Gentleman and I had an extensive debate on this matter in February. We are satisfied that the protections in CETA are adequate for protecting our national health service and our right to regulate in the domestic market.
It has long been an aspect of UK Government policy under successive Governments to make sure that trade agreements work for services. That is actually in the UK national interest—80% of our country’s GDP comes from services and 79% of our employment comes from services—and has been an objective of successive Governments.
Greg Hands
Of course I will allow the hon. Gentleman to intervene, to clarify where he is with Tony Blair.
Barry Gardiner
My relationship with our former Prime Minister is probably not in scope for the Committee. However, I assure the hon. Gentleman that the Labour party and the Opposition in Committee do not in any way want to stop the very valuable exports that our service industries make to the rest of the world. We want to see them flourish, but we want them to do so within a framework that does not prejudice the protections that should properly—as the Minister has acknowledged—be in place for public services and the public sector in this country, and the right to protect our national health service and to ensure that public procurement can be done properly.
Greg Hands
I think we shall leave it at that. I thank the hon. Gentleman for his clarification of where he stands in relation to Tony Blair.
Protecting the UK’s right to regulate public services is, of course, of the utmost importance. UK public services are protected by specific exceptions and reservations in EU trade agreements where relevant. As we leave the EU, the UK will continue to ensure that rigorous protections are included in all trade agreements that it is party to. On that basis, I ask the Opposition to withdraw the amendment.
Bill Esterson
I will not be drawn on everything the Minister said, but I will go back to what the hon. Member for Kilmarnock and Loudoun said in his short speech. The amendment and the Bill are about trade agreements and not about the single market. My hon. Friend the Member for Brent North made it clear on Second Reading exactly what our relationship with the single market will be once we have left the European Union—if we are not a member of the European Union, it is not possible to have a say in the rules, so we are therefore not a full member whatever our relationship with the single market. He explained it extremely well.
The amendment is about the relationship with future trade agreements and about having the right protections for public services. I go back to what I said in my speech: the amendment is about ensuring that we have the ability in law to bring services back in, in the light of Carillion, whether they are to do with the NHS or other services. In the public interest—the public good—this country should have the ability to decide where its public services are run.
Matt Western
Back in February last year, as I understand it, the Minister told the International Trade Committee that the NHS would remain off limits in trade negotiations and that he would not sacrifice the Government’s right to regulate public services. Does my hon. Friend therefore share my surprise that the Minister is not keen to include the amendment in the Bill?
Bill Esterson
I share my hon. Friend’s surprise because, as I said in my speech, repeated public reassurances and “best endeavour” commitments from Ministers are not the issue; legal certainty and absolute exemption are required. If the Minister will not accept the amendment, perhaps he will tell us now that he will bring forward his own amendment later in our proceedings to achieve exactly that.
Greg Hands
We are talking here about future trade agreements, on which I have clearly laid out our position. I will just pick up on a point made by the hon. Member for Warwick and Leamington. I think he is incorrect in what he said on any evidence I might have given to the International Trade Committee last February. To be clear—and perhaps to my regret—I did not appear in front of that Committee until last week.
Bill Esterson
It is odd to be intervened on about the comments of another Member. I suspect my hon. Friend the Member for Warwick and Leamington meant the Secretary of State. I thought all Ministers spoke as one in Government, although we have seen enough evidence in recent days, weeks and months to suggest that that is not entirely true. Today is perhaps the latest example, with the leaked reports from the Secretary of State for Exiting the European Union. We are wandering, and I think the Chair might have something to say on that.
Over the weekend, the Prime Minister left a degree of ambiguity in her words on this issue. As my hon. Friend the Member for Brent North quite rightly reminded us, the German Government felt sufficiently concerned about CETA to exclude healthcare from its provisions. We should be very mindful of that. The Government are keen to, in their words, roll over that agreement, although with the acknowledgement that that may involve technical changes. Perhaps we can all agree that it will become a corresponding agreement.
There is a body of evidence from across the years showing the need for cast-iron guarantees to protect public services, so that they can be delivered in the public good and brought back in house where necessary. Without it being legally binding in the way we have set out in the amendment, it is difficult to see how that can be achieved. I will ask again: if the Government will not support the amendment, will they bring forward their own amendment that delivers on exactly that point later in our proceedings? There will be further opportunities in this House and in the other place to do so.
Question put, That the amendment be made
Judith Cummins
I beg to move amendment 8, in clause 2, page 2, line 29, at end insert—
“(4A) Regulations may only be made under section 2(1) if—
(a) the provisions of the international trade agreement to which they relate are consistent with standards for food safety and quality as set and administered by—
(i) the Department of Health;
(ii) the Food Standards Agency; and
(iii) any other public authority specified in regulations made by the Secretary of State;
(b) the Secretary of State is satisfied that mechanisms and bodies charged with enforcement of standards for food safety and quality have the capacity to absorb any extra requirement which may arise from the implementation of the agreement;
(c) the provisions of the international trade agreement to which they relate are consistent with policy to achieve reduction in the risk of disease or contamination as set and administered by—
(i) the Department of Health;
(ii) the Food Standards Agency; and
(iii) any other public authority specified in regulations made by the Secretary of State;
(d) the provisions of the international trade agreement to which they relate are consistent with achieving improvements in public health through any food policy priorities set and administered by—
(i) the Department of Health;
(ii) the Food Standards Agency; and
(iii) any other public authority specified in regulations made by the Secretary of State;
(e) the provisions of the international trade agreement to which they relate are compliant with policy to achieve targets for farm antibiotic reduction set by the Veterinary Medicines Directorate;
(f) the provisions of the international trade agreement to which they relate are compliant with retained EU law relating to food standards and the impact of food production upon the environment; and
(g) any food or food products to which the provisions of the international trade agreement apply meet standards of labelling, indication of provenance, and packaging specified by the Food Standards Agency.
(4B) A statutory instrument containing regulations of the Secretary of State under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”.
This would ensure that international trade agreements maintain or enhance food safety standards in the UK.
The amendment speaks to the critical issue of food and food safety, in the context of our future international third country agreements. No Committee member needs me to tell them of the central importance of maintaining food safety standards in this country and ensuring that the British people can have confidence in those standards. However, perhaps it is necessary to provide some explanation of why this has become such a totemic issue in the debate around international trade.
Alan Brown
In her opening remarks, the hon. Lady has talked about reassuring the British people. I note that the amendment mentions the Department of Health and the Food Standards Agency. Is it not deficient because it does not recognise the devolved Administrations? I wonder whether that is an omission, because Food Standards Scotland actually gave evidence to this Committee.
Judith Cummins
The hon. Gentleman makes a very good point.
It is easy to joke about chlorine chicken or hormone beef, and at least one of the witnesses in the oral evidence sessions noted that we have heard more about those particular delicacies than we would ever wish to. Yet there is a profoundly serious point underlying the reference to them—a point that was hammered home in November last year when Wilbur Ross, the man appointed by Donald Trump to be US Secretary of Commerce, addressed the annual conference of the CBI.
Mr Ross put the UK on notice that we will have to relax our food safety laws if we wish to have a trade deal with the USA. He specifically called out the sanitary and phytosanitary regulations that we have in place to protect against the importation of potentially dangerous products, and he complained that they act as a barrier to US exports, seeing as the regulations that US producers have to abide by in their home markets are much lower than those that apply in Europe. Mr Ross explicitly warned the British people that we need to downgrade our food standards if we wish to have a trade deal with the USA.
The regulatory system that we have developed over decades in the UK is based on the precautionary principle, which states that where there is a risk that public health or safety might be compromised, regulatory bodies must err on the side of caution. The principle applies even if the level of risk cannot be fully quantified under the science that we have today. Any company or individual who wishes to introduce a product or process to the market must—quite rightly—prove it is safe to do so.
Barry Gardiner
On the point made earlier by the hon. Member for Kilmarnock and Loudoun, proposed new sub-paragraph (iii) of the amendment refers to
“any other public authority specified in regulations made by the Secretary of State”.
Does my hon. Friend agree that that therefore makes provision for the other Administrations’ bodies to be included in the scope of the amendment, although I entirely take the hon. Gentleman’s point that Food Standards Scotland was not specifically mentioned, and it might well have been?
Judith Cummins
I thank my hon. Friend and the hon. Member for Kilmarnock and Loudoun for their interventions, in which they both made valid points.
In the USA, the requirement is reversed. Those who wish to introduce products or processes to the market are free to do so unless the authorities can prove that they are unsafe. What they have tried to call the “scientific” approach to food safety, as opposed to the risk-based approach that we enjoy in this country and throughout Europe, has meant that the USA has ended up with lower standards of food hygiene and food safety. That is why the processes behind meat production on either side of the Atlantic are so radically different.
More than 90% of US beef is produced with the use of bovine growth hormones that have been linked to cancers in humans. We have food safety regulations in place across Europe that have banned any imports of hormone-grown beef from the USA and other countries for 30 years. US poultry producers are permitted to douse chicken and turkey carcasses with chlorine washes before selling them on to consumers. Again, that practice has been banned in Europe for more than 20 years, and the USA has challenged the ban at the WTO as being a barrier to its ability to penetrate the EU market.
The connection with animal welfare is paramount in this respect, in that the European regulations seek to introduce at least some consideration for the welfare of the animals that are farmed for human consumption. The USA has no comparable regulations on animal welfare, and the conditions in which its industrial farming takes place do not bear thinking about. Let me make the central point clear: the issue before us in this Bill is not whether we like the idea of eating hormone-grown beef, or whether we care about animal welfare in the raising of poultry for slaughter—those are debates we can have another time; the issue before us here is that we must be the ones to decide on food safety and animal welfare issues, and we must do so in an open forum as the elected representatives of the people of the United Kingdom.
Faisal Rashid
Does my hon. Friend agree that, if we do not secure an amendment to protect food safety standards in the UK, we will be failing our constituents and potentially putting public health at risk?
Judith Cummins
My hon. Friend makes a very important point. It is important that we consider those wider issues in this Committee.
It is unacceptable that we might come to such a debate in the future only to discover that our right to choose what we eat and how it is produced has already been traded away in secret negotiations by a Secretary of State who ranks getting a trade deal far above protecting food safety for the British people. Amendment 8 would simply ensure that our trade agreements conform to food safety policies, not the other way around.
The significance of the challenge laid down by Wilbur Ross at the CBI last November was lost on no one. Two days after the speech, the EU’s chief negotiator, Michel Barnier, responded to Wilbur Ross and posed the No. 1 question for the UK: do the British people wish to remain aligned with the European Union’s relatively high standards, or do we want our food safety standards to be downgraded so we can do a dirty deal with the USA?
Matt Western
Does my hon. Friend agree that, given the Secretary of State’s statement that there
“are no health reasons why you couldn’t eat chickens that have been washed in chlorinated water”—
of course, that is the same Secretary of State who said that Brexit is the easiest thing in human history—it is crucial that we set out in statute that international trade agreements must maintain the food safety standards in our country?
Judith Cummins
My hon. Friend is absolutely right that that must be set out in regulations and in statute.
I want to spell out clearly the connection between this amendment and one of the key issues in the post-Brexit settlement between the UK and the EU—namely, the border issue on the island of Ireland. Hon. Members will recall the dramatic scenes last month when our Prime Minister finally managed to move us on to negotiations with the EU about what our long-term relationship should be after Brexit. That was achieved by way of an agreement in respect of the island of Ireland, which committed the UK to the following:
“In the absence of agreed solutions, the United Kingdom will maintain full alignment with rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the all-island economy and the protection of the 1998 Agreement.”
When pressed further on what exactly that might mean, the Prime Minister was more explicit. She specified that there are six areas that are covered at present by north-south co-operation on the island of Ireland, and confirmed that one of them is agriculture.
The significance of the Prime Minister’s words goes far beyond the immediate issue of how we are to relate to the remaining 27 member states of the European Union in the future. Any suggestion that the UK might downgrade its food safety regulations to do a deal with the USA or any other trading partner would wreak havoc among farming communities both north and south of the border in Ireland, which would find themselves unable to continue trading freely. Allowing the Secretary of State to contemplate such a divergence in a trade deal with the USA or any other trading partner would jeopardise the peaceful co-existence that we have all endeavoured to hold together since the Good Friday agreement was signed 20 years ago. That is why amendment 8 is so important, and we hope the Government will vote to support it.
There are real threats. The USA agricultural lobby called for EU rules on pesticides to be downgraded in TTIP, given that we have far stricter regulations on the levels of chemical pesticide residue permitted in food. It called for our ban on the sale of genetically modified organisms to be eliminated, given that 70% of all processed food in US supermarkets is now made with genetically modified ingredients. It also called for an end to the mandatory labelling of products containing genetically modified ingredients, on the grounds that it represents a hidden barrier to trade. Consumer choice would go out of the window with public health, food safety and animal welfare rights.
Matt Western
Does my hon. Friend agree that this is clearly an issue, as has been described, of consumer information and consumer rights, in terms of not just the quality of food being put on our plates but the conditions in which our animals are kept, the state of the abattoirs and the standards we maintain so highly in this country?
Judith Cummins
I thank my hon. Friend for that intervention, and I repeat that it is important to maintain the regulatory standards we have in this nation.
The US Government trade representative confirmed in writing at the very outset of the negotiations that the USA’s TTIP negotiators would be seeking to eliminate or downgrade those sanitary or phytosanitary measures that prevent US exports from entry into the market of the UK and other EU member states. That was one of the central reasons why TTIP became so toxic across country after country in Europe, and why the European Commission soon discovered that it had no legitimacy to continue the TTIP negotiations at all.
I should also note that there is a commercial aspect to this. The celebrity chef, Jamie Oliver, was so concerned about the potential impact of TTIP on his business—which is based on high-quality food imports at every stage of the supply chain—that he took it upon himself to call on the previous Secretary of State for cast-iron guarantees that food standards would not be included as part of the TTIP negotiations. The Secretary of State was unable to give him those guarantees, since the TTIP negotiations were, at that same moment, addressing sanitary and phytosanitary measures at the express demand of the US Government. Of course, those negotiations were going on behind closed doors.
That is what Wilbur Ross meant when he warned that the USA would demand the downgrading of UK food standards. That is why it has been so appalling to see the current Secretary of State laughing off the threat represented by such a downgrading of our standards.
Greg Hands
I have been listening carefully, but to be absolutely clear, I think the hon. Lady referred to the previous Secretary of State. Obviously, the current Secretary of State is the first and only Secretary of State for International Trade. Could the hon. Lady perhaps clarify whom she is referring to as the previous Secretary of State?
Judith Cummins
I am referring to the right hon. Member for Twickenham (Sir Vince Cable).
Amendment 8 also seeks to ensure that the food we eat comes from healthy animals that are naturally resistant to disease, not dosed up with antibiotics as an alternative to maintaining food hygiene throughout the production process, which is a standard model of industrial farming in the USA. We all know about the real threat of superbugs that develop their resistance to antibiotics. That is why the Veterinary Medicines Directorate has set targets for the reduction of antibiotic use in agriculture. This is where the interface between animal welfare and food safety becomes most compelling, and why British farmers should be proud to produce food that adheres to the highest standards—all the way from farm to fork.
Finally, this amendment would ensure that the bodies responsible for upholding and enforcing food standards in this country have the capacity to meet any extra requirements placed on them.
Faisal Rashid
I was just reading some of the evidence submitted by Sustain, the alliance for better food and farming, which says exactly what my hon. Friend is saying:
“We want affordable food, not cheap food, which may be poor quality or unsafe to eat. Cheap, poor quality, imported food will come at a cost—to the farmer or food producer, to animal welfare, to the environment or jobs in UK food and farming. There may be hidden costs to our NHS and economy from food poisoning and lost days at work.”
Does my hon. Friend agree that this amendment will help to protect our food standards?
Judith Cummins
I thank my hon. Friend for that intervention and wholeheartedly agree that this amendment would help to protect our food standards.
To clarify my previous comments and the intervention by the Minister, I was referring to the right hon. Member for Twickenham in his former role as Business Secretary.
Finally, this amendment would ensure that the bodies responsible for upholding and enforcing food standards in this country have the capacity to meet any extra requirements placed on them as a result of new UK trade agreements. We absolutely do not wish to see any downgrading of capacity in relation to food safety officers or others responsible for ensuring that we can have confidence in the food on our shelves.
Once again, I find it hard to see how the Government can find any reason to object to this amendment, and I hope that we can count on support from the Government Benches in voting it through.
Trade Bill (Sixth sitting)
Tuesday 30th January 2018
(6 years, 10 months ago)
Public Bill CommitteesRead Full debate Trade Bill 2017-19 View all Trade Bill 2017-19 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 30 January 2018 - (30 Jan 2018)
The Committee divided: - Ayes: 7 / Noes: 10 - Question accordingly negatived.
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The Minister for Trade Policy (Greg Hands)
May I start by welcoming you to the Chair, Mr Davies?
The Government have already made it clear that we will not use the necessary and indeed pertinent exercise of continuing the effects of our existing agreements as a back-door way to reduce standards, including food safety standards. As the Prime Minister said in Florence in September, we are
“committed not only to protecting high standards, but strengthening them…we will always be a country whose pitch to the world is high standards at home.”
I am happy to reaffirm the Prime Minister’s commitment to the Committee. We are committed to upholding and strengthening our high standards in public health and safety, product performance and protecting the environment.
Faisal Rashid (Warrington South) (Lab)
How does the Minister plan to prevent a race to the bottom on food safety standards in the UK and to protect British consumers if he is not prepared to accept the amendment?
Greg Hands
The Government have always been clear that we will maintain our very high standards on food and animal welfare, and for protection in that space. There will be no race to the bottom. Nothing in free trade agreements precludes a Government from regulating in the domestic environment. I hope that that is enough reassurance for the hon. Gentleman. On protecting the environment, high standards and high quality are what our domestic and global consumers demand, and that is what we should provide.
To be clear, nothing in the Bill would allow us to do a free trade agreement with the United States because, as we know, the United States does not have a free trade agreement with the European Union. While the hon. Member for Bradford South gave an interesting speech of some length about what may or may not happen in any future trade agreement with the United States, it is worth mentioning that the Bill does not cover free trade agreements with the United States. Any future free trade agreement with the United States must work for UK farmers, businesses and consumers, and uphold food safety and animal welfare standards. However, that is a matter for a future day; it is not relevant to the Bill before us.
Barry Gardiner (Brent North) (Lab)
Surely the Minister appreciates that the examples of the USA were given in order to clearly illustrate the principles. At no point was it suggested that those examples were a necessary follow on. However, they illustrated the principles, and the Minister must appreciate that and take it seriously, in terms of the amendment.
Greg Hands
We take incredibly seriously food safety standards, animal welfare and so on. If the hon. Gentleman is suggesting that he has serious concerns in those spaces in respect of any of the 40-plus current EU trade agreements that we are seeking to move into UK law, perhaps he could let me know.
Barry Gardiner
I am very happy to adumbrate on that. The particular concerns relating to growth hormones in beef are, of course, of equal importance in the context of any future UK-Canada trade agreement, given that Canadian beef farmers are permitted to use growth hormones in a way that our farmers are not. The EU granted a higher quota to hormone-free Canadian beef exports in the EU-Canada comprehensive economic and trade agreement negotiations. It was only popular pressure that prevented the European Commission from relaxing the ban on imports of hormone beef. We simply want to ensure that Parliament is the place where this country takes decisions on whether to relax or tighten our food standards. We do not want those decisions taken in secret trade negotiations and then imposed on us through the excessive powers in the Bill.
Greg Hands
I am certain that CETA is consistent with our food safety and animal welfare standards. What is more, I think the majority of Labour MPs agree with me. Last February, Labour MPs split 86 in favour of CETA and 68 against, so whatever concerns the hon. Member for Brent North has, I gently suggest that he tries to persuade his own party before coming to see the Government.
Barry Gardiner
Again, I am happy to take on the Minister on that. He is talking about something that happened before the previous election, and as personnel change, so perhaps does the wish of the members of the parliamentary Labour party. However, that is not really the point. He will also find that those people on the Labour Benches who wanted to support CETA on that occasion seem now to have changed their views about whether CETA—the Canadian model—is a good model for us to pursue in the trade negotiations. Most of them seem to have turned tail and run to the other side.
Greg Hands
The hon. Gentleman is trying to mix up the transitional and existing trade agreements with our future trading relationship with the European Union—which, I remind the Committee, is also not a subject of the Bill. I think he said that his vote against CETA was before the previous election, and if he is suggesting that he might have changed his mind on CETA, I am all ears. When we come to ratification of the treaty, I would personally welcome him as a sinner that repenteth, were he to come into the Lobby with Conservative Members to support the Canadian free trade agreement.
Greg Hands
I will not give way. We are getting a little off the point.
We are absolutely clear that all existing commitments on standards and regulations will remain when those agreements are transitioned. That is in line with our clearly articulated principle that our intent is to transition solely the existing effect of the agreements. The amendment is therefore unnecessary and I ask the hon. Member for Bradford South to withdraw it.
Judith Cummins (Bradford South) (Lab)
We will not withdraw the amendment and wish to proceed to a vote.
Question put, That the amendment be made.
Barry Gardiner
I beg to move amendment 11, in clause 2, page 2, line 41, leave out subsections (8) and (9) and insert—
“(8) No regulations may be made under subsection (1) in relation to an agreement which meets the criteria in subsection (3) or (4) after the end of the period of five years beginning with exit day.”
This would make the sunset clause governing section 2(1) non-renewable.
The Chair
With this it will be convenient to discuss the following:
Amendment 12, in clause 2, page 2, line 41, leave out subsections (8) and (9) and insert—
“(8) No regulations may be made under subsection (1) in relation to an agreement which meets the criteria in subsection (3) or (4) after the end of—
(a) the period of five years beginning with exit day (“the initial five year period”), or
(b) such other period as is specified in regulations made by the Secretary of State in accordance with subsection (9).
(9) Regulations under subsection (8)(b) may not extend the initial five year period beyond the day which falls ten years after exit day.”
This would make the sunset clause governing section 2(1) renewable once only.
Amendment 35, in clause 2, page 3, line 3, at end insert—
“(10) No regulations may be made under subsection (8)(b) unless the Secretary of State has consulted with the Scottish Ministers and the Welsh Ministers.”
This amendment would ensure that there must be consultation with the Scottish Ministers or Welsh Ministers before any extension of the powers in Clause 2.
Barry Gardiner
I, too, am pleased to welcome you back to the Chair, Mr Davies. How do you know when a Minister feels guilty? It is when he or she introduces a sunset clause. The Government know they are pulling a fast one in the Bill and clause 2 includes the Henry VIII power for Government to amend primary legislation by fiat. The provisions in the rest of clause 2 and its accompanying schedules reduce hon. Members of this House to little more than bystanders at a royal pageant.
The Government try to mitigate their power grab by making the offending powers in clause 2(1) subject to a five-year sunset clause. The Secretary of State is on record as saying:
“I hear people saying, ‘Oh, we won’t have any before we leave’. Well, believe me, we’ll have up to 40 ready for one second after midnight in March 2019. All these faint hearts saying we cannot do it—it’s absolute rubbish”.
Let us for a moment take the Secretary of State at his word and believe him when he tells us that we will have all these shiny new agreements ready and waiting by the end of March 2019. The five-year sunset clause that the Bill gives the Government is surely, therefore, the sort of defeatist nonsense that the faint-hearted would say they need. According to the Secretary of State, a half-hour sunset clause would be more than enough—perhaps half a day to pick up the stragglers or half a week to pick up the rank outsiders, the real laggards in the case. What is this nonsense?
There is a serious issue, because these agreements are supposed to provide British businesses with the certainty they desperately need so as to plan their operations and their investments in respect of trade with those countries with which we already have agreements by virtue of our membership of the EU.
Yes, the Secretary of State for Exiting the European Union has confirmed that the UK will be unable to implement any of the new trade agreements until the end of a two-year transition period that we will negotiate with the EU, but that only buys the Government until the end of 2020 to come up with the 40 new trade agreements the Secretary of State promised would be ready by March 2019. The end of 2020 is the terminus proposed by the EU for our transition period, as was confirmed in the negotiating directives that it adopted yesterday.
Faisal Rashid
Does my hon. Friend agree that, without limits on the renewability of the sunset clause and against the backdrop of a Government failure to commit to a second trade Bill, this Bill will certainly be seen by many as a potential Trojan horse for the Government to introduce future deals with minimum levels of scrutiny?
Barry Gardiner
My hon. Friend is absolutely right to be sceptical. The Minister has made much of the arguments that, first, there is a need for speed and, secondly, this is only a temporary Bill that puts in place temporary provisions to roll over the existing agreements. In fact, the powers—certainly the ones relating to the agreement on government procurement—are not temporary; they last longer.
Here, in the provisions of the sunset clause, we have not just one sunset period but the possibility of indefinite roll-overs of the sunset clause itself: five years, followed by five years, followed by five years. If the Minister is absolutely confident that the Bill is a temporary necessity, one must wonder why he wants the sunset clause to continue indefinitely into the future at the Government’s will, when it enables the Government to take on a Henry VIII power.
When I say that there should be a proper process of consultation and scrutiny by which to debate the negotiations, I am only replicating what Anastassia Beliakova of the British Chambers of Commerce demanded in her oral evidence during our final witness session last Tuesday, when she said that provision needs to be made not only for “appropriate scrutiny in Parliament” but for a proper process of “stakeholder engagement for business” and “civil society” in order to scrutinise any changes that might arise as a result of the negotiations.
If the Government are adamant that such a process is to be denied us, rejecting the advice of business and the demands of trade unions and other civil society bodies, it should be denied us for an absolute maximum of five years, with no renewal of the sunset clause, as provided for in clause 2(8) and (9). Every day longer that the Government have those powers is another day for which parliamentary democracy is put on hold. The first of our amendments says that five years is enough. We believe that it is five years too many, given the unmerited powers that the Bill grants to the Government and the rights that it strips away from Parliament, but certainly five years should be enough. If the Government still have not managed to roll over their agreements by March 2024, that power should disappear along with the expiry date.
I really wonder whether Government Members themselves believe that an indefinite use of a roll-over to give an unending Henry VIII power to the Government is a sensible power that this Committee should grant.
Let us say that the Government persist in getting rid of amendment 11. Amendment 12 would allow the Government one renewal only. That is, the Government would be allowed to ask Parliament for permission to renew the sunset clause for one extension, but no more. That would allow the Government the unmerited powers in the Bill right up to the end of March 2029. Can the Minister really demand, with any sense of integrity, that this Committee afford him and the Government greater power than that?
Alan Brown (Kilmarnock and Loudoun) (SNP)
It is a pleasure to serve under your chairmanship again, Mr Davies.
First, I reiterate that Opposition Members do not see the Bill as fit for purpose. We accept the need for clause 2: the Government will need to manage the handover of trade deals that are currently accessed through the EU. However, clause 2 is deficient and we are still to hear what the Government will to do to improve it and to improve the Bill. They have voted down every amendment that has been proposed so far, so it would be good to hear the Minister’s plan. Again, that is particularly important regarding the Government’s attitude to the devolved Administrations.
Just this morning, BBC Radio Scotland led its headline news with a report on the European Union (Withdrawal) Bill, which is now moving to the House of Lords, and the fact that the House of Lords will have to make amendments to clause 11—amendments that were originally promised by the UK Government but were not brought forward. It did not paint the UK Government in a good light, especially when the UK Government could not even put up any spokesperson; it is plain why that was the case.
I say to the Minister that, given that the Scottish and Welsh Governments have both said that they will withhold a legislative consent motion unless there are amendments to this Bill, it would be prudent for him not to fall into that trap. Failing to make amendments once looks incompetent, but if proper amendments are not made to this Bill that satisfy the devolved Administrations, it will look a bit more sinister than mere incompetence.
I remind the Committee that it is not just politicians from the Scottish National party who are saying this; clearly, the Welsh Government are in agreement with the SNP. In the evidence sessions, which the Minister was at, we heard from different witnesses. Chris Southworth from the International Chamber of Commerce UK said:
“Overall...I would be concerned if I were in the devolved Administrations. There is specifically no opportunity for the devolved Administrations…to feed into decisions on trade. I would be very concerned about that, particularly in the devolved Administrations”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 35, Q80.]
Michael Clancy from the Law Society of Scotland said:
“There is clearly an issue about how the Sewel convention or legislative consent convention is interpreted in respect of that…any proposals in UK Parliament legislation that seek to alter the legislative competence of the Parliament or of Scottish Ministers require the consent of the Parliament.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 56, Q107.]
Professor Winters from the UK Trade Policy Observatory said:
“Parliament and the devolved Administrations need to have an important role in setting mandates, and there need to be consultation and information during the process.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 58, Q111.]
In written evidence, the Fairtrade Foundation, Trade Justice Movement, Global Justice Now and Traidcraft all clearly expressed the need for the devolved Administrations and Chambers to be given a role in the UK’s future trade policy.
Unfortunately, despite all that evidence the position of the hon. Member for Brent North appears to be that if the devolved nations do not have the powers at present, they should not look at getting them in the future. His phrase earlier was that they “shouldn’t be looking upwards”. To me, that sounds a wee bit like, “Don’t get ideas above your station”.
We have not tabled any amendments to schedule 1, which imposes limitations on the devolved Administrations. I would argue that that in itself shows that the Scottish Government and the Welsh Government have taken a rational approach to the Bill in respect of the various amendments that have been tabled. We are not trying to create some form of awkward veto, as has been suggested elsewhere. Our simple intention is to make sure that the devolved Administrations are not ridden over roughshod. That means that there needs to be co-operation, consultation and consent.
Barry Gardiner
I want to reassure the hon. Gentleman that we are absolutely at one with him in wanting to ensure that the Bill does not make provision for Westminster Ministers to overreach themselves into devolved competences in any of the devolved Assemblies of the nations of our United Kingdom. We are equally concerned about that.
I have tried to present amendments in as open a way as possible, so that we can get the best wisdom from the Government and from the devolved Administrations, to ensure that nothing is done that would make it difficult, or indeed impossible, for a UK Government to honour any aspects of their international obligations under an international trade treaty. That is my only concern, and I am sure we can get to the right place with good will all round. It is a constitutional question, because these powers have not previously been possessed by the UK Government; they were held at EU level. It is therefore important that we give the matter the scrutiny that it deserves.
On amendment 35, which we are about to move on to, we are probably at one.
The Chair
Order. I remind hon. Members that interventions are meant to be briefer than the leeway I allowed the hon. Gentleman.
Alan Brown
Thank you, Mr Davies, and I thank the hon. Gentleman for his intervention. I welcome his opening remarks, and I might have an opportunity to show how much when other amendments go to a vote. I also welcome his support for amendment 35. He talked about the wisdom of co-operation and of working with Government, and the wisdom of devolved Administrations. It is maybe a pity that the wisdom of the devolved Administrations is coming through me rather than directly, but we will just have to deal with that.
Amendment 35 is very modest. All we are asking is that, if the UK Government propose to extend the sunset clause, they must consult the Scottish and Welsh Governments. That does not seem to be too big an ask to me. It is also more pertinent given the five-year period proposed in the Bill. Given that the Bill, as I keep hearing, is to do only with the UK’s access to existing EU trade deals and bringing those deals into UK legislation, it makes me wonder why we would ever need a period beyond five years. We are dealing with legislation that should be coming forward quickly, given the date for leaving the EU, and given that the International Trade Secretary has said that these negotiations will be the easiest in human history. Why we would need Henry VIII powers beyond five years is a mystery. We are just asking for the courtesy that the Scottish and Welsh Governments are consulted if that is the case.
Greg Hands
We have had a wide-ranging and interesting mini debate, full of historical references and colourful metaphors. We have had Henry VIII, plenty of sunsets and royal pageants. The hon. Member for Warrington South even introduced a Trojan horse. It has been a helpful debate.
Let me try to explain why we have included the sunset clause for this power, because once I have explained, all will become clearer. It is so that Parliament can have the chance to review its merits once again five years after exit date. However, since this power may be required to ensure the operability of transition agreements beyond the five-year period, potentially indefinitely, it is important that the Government have the option to extend the use of the clause 2 power. That will, of course, be subject to the approval of both Houses.
Hannah Bardell (Livingston) (SNP)
I am certain that the right hon. Gentleman is determined, in his approach and plan, to consult the devolved nations. If he is, why not put that in the Bill to ensure that it happens?
Greg Hands
Because I like to keep legislation as brief as possible and, as I shall explain, I do not think it necessary for us to write that obligation into the Bill. Of course, we would continue to engage should we need to extend the clause beyond its sunset five years after exit day.
I was intrigued by the exchange between the hon. Members for Kilmarnock and Loudoun and for Brent North. I am still trying to find out why, on Thursday, the Labour Front-Bench team did not support the amendment promoted by the Welsh Government. I am not sure that the hon. Gentleman properly explained, but perhaps when he responds he can throw a little more light on why he has seemingly jettisoned his colleagues from Wales, one of whom is on this very Committee.
On the requirement for a legislative consent motion, we have been clear that we are seeking such a motion for the Bill. I heard what the hon. Member for Kilmarnock and Loudoun said about that, and I am sure that we will engage further. We are obviously talking to the devolved Administrations so that we can work towards delivering a Bill that will benefit the whole UK. Given that, we do not think that the formal commitments on consultation and engagement in amendment 35 would add substantively to the Bill. I therefore ask hon. Members not to press the amendments.
Barry Gardiner
We have no intention of withdrawing amendment 11, so we need to press it to a vote.
Question put, That the amendment be made.
Barry Gardiner
On amendment 12, to respond to what the Minister said, we heard oral evidence from Mr Howarth, who was in fact an adviser to Conservative MPs, that the Henry VIII powers were needed only for minor changes, potentially around the EU agreements—
The Chair
Order. May I interrupt the hon. Gentleman? His opportunity to respond to the debate was before the previous Division. I was really just asking whether he wanted to move amendment 12 formally.
Barry Gardiner
I was simply explaining that, in the light of the Minister’s remarks, we do wish to move the amendment, because it conforms with the suggestions of one of the Government’s own witnesses.
Amendment proposed: 12, in clause 2, page 2, line 41, leave out subsections (8) and (9) and insert—
“(8) No regulations may be made under subsection (1) in relation to an agreement which meets the criteria in subsection (3) or (4) after the end of—
(a) the period of five years beginning with exit day (‘the initial five year period’), or
(b) such other period as is specified in regulations made by the Secretary of State in accordance with subsection (9).
(9) Regulations under subsection (8)(b) may not extend the initial five year period beyond the day which falls ten years after exit day.”—(Barry Gardiner.)
This would make the sunset clause governing section 2(1) renewable once only.
Question put, That the amendment be made.
Barry Gardiner
I beg to move amendment 13, in schedule 2, page 12, line 5, leave out from “section 1(1)” to the end of line 6 and insert
“may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”
This would require regulations implementing the Agreement on Government Procurement to be subject to the affirmative resolution procedure.
This amendment is a simple but vital first attempt to restore democracy to the Trade Bill. It is simple because it replaces the negative resolution procedure the Government wish to use for future regulations under paragraph 2(1) of schedule 2 with an affirmative resolution procedure. It is vital because, without that, the Government have carte blanche to introduce regulations to implement the obligations arising from our independent membership of the GPA without the slightest hint of anything resembling parliamentary scrutiny. While the UK is a member of the World Trade Organisation in its own right and will continue to be so after Brexit, we are a member of the WTO’s plurilateral government procurement agreement only by virtue of our EU membership. We know that the Government will have to initiate a separate parliamentary procedure under the Constitutional Reform and Governance Act 2010 to prepare for the UK to rejoin the GPA in its own right. I am pleased the Minister made the commitment in our first line-by-line session last Thursday that there will be a vote in Parliament to decide on the terms under which we rejoin the GPA.
Greg Hands
I thank the hon. Gentleman for giving way. That is not a correct assessment of what I said on Thursday. I said we would allow the power for Parliament to bring forward a vote under the Act. It is clearly stated in Hansard.
Barry Gardiner
Good Lord, Mr Davies, it’s a jolly good job I have an extract from the Hansard here. I will press on and then quote from it.
CRAGA does not require there to be a debate or a vote on any treaty laid before Parliament under its terms, as has been repeatedly confirmed by the House of Commons Library via an expert witness from the Hansard Society and by everybody else who has read the Act or knows what it says. Yet, it certainly leaves the possibility open for Government to hold that vote if they are prepared to do so. Again, I am pleased the Minister reaffirmed last week not only that it is possible under CRAGA for the Government to bring forward a vote on the UK’s terms of entry into the GPA, but that
“the terms on which the UK enters the GPA in our own right will be subject to a separate vote in Parliament.”—[Official Report, Trade Public Bill Committee, 25 January 2018; c. 131.]
Those are the words the Minister actually used. I am surprised he wants to cavil about them now. As he knows, our dissatisfaction with CRAGA is that it includes no requirement for a debate or a vote on a treaty laid before Parliament under its provisions. We are dependent on the good will of the Government as to whether Parliament is granted or denied the opportunity for a vote.
In this instance, I thought the Government had confirmed that there will be a vote, not that there might be, depending on the Labour party, so we look forward to the Government introducing that debate in Government time. However, that in no way deals with the broader issue of why Parliament should be dependent on the Government’s good will to have the opportunity to exercise its rights to due democratic process.
Faisal Rashid
It has been widely documented that the use of the negative resolution procedure the Bill proposes affords Members less opportunity for scrutiny in the House than is currently enjoyed by Members of the European Parliament. Indeed, Jude Kirton-Darling MEP told the Committee in no uncertain terms that the Bill is
“an enormous step back in democratic oversight of trade agreements.”—[Official Report, Trade Public Bill Committee, 23 January 2018; c. 43, Q86.]
Does my hon. Friend therefore agree that, for the Government to meet their commitment that the Bill will replicate existing arrangements as closely as possible, they must support the amendment to ensure the opportunity for scrutiny enjoyed by Members is closer to that currently enjoyed by MEPs?
Barry Gardiner
Indeed—my hon. Friend is right. Many Members on both sides of the House think it a travesty that we are afforded less opportunity to scrutinise things and less transparency than is afforded to our colleagues in the European Parliament.
On the agreement on government procurement, once we have had our opportunity to debate and vote on the terms under which we will rejoin it, the Government will then lodge our annexes with the WTO. The next stage is to issue the regulations that will implement the terms of our accession to the GPA, and then, in the years thereafter, to make changes to our domestic legislation that reflect the accession of new parties to the GPA or the withdrawal of any countries that decide to leave it.
It is important to note that that is not a temporary power covered by a sunset clause, as with the international trade agreements in clause 2. This is a permanent power for the Government to issue regulations implementing the UK’s obligations under the GPA into the indeterminate future—for as long as the WTO remains and the GPA is one of its constituent agreements. When we look at the fine detail of the Bill, we yet again discover that it is not a temporary little Bill about rolling over existing agreements; it actually has permanent, lasting effect. The roll-over powers could give Ministers the powers in perpetuity, under the Henry VIII provision.
We hear that the Bill is small, necessary, timely and time-limited, but in actual fact it is not. Our amendment 13 seeks to replace the negative resolution procedure, which the Government wish to apply to clause 1(1), with the affirmative procedure. I will remind the Committee of what that means so that we have a proper understanding of what we are talking about in this context, because it will also be essential to several later amendments that we will bring forward to other parts of the Bill.
The scrutiny procedure for delegated legislation in the House of Commons has come in for intense criticism in the context of the European Union (Withdrawal) Bill. That criticism is well merited. The Hansard Society’s expert report, “Taking Back Control for Brexit and Beyond”, lifted the veil on just how badly the system is failing to deliver the necessary scrutiny of secondary legislation at precisely the moment we need full confidence in it as we rebuild our system of checks and balances for the post-Brexit future. That report does not make pleasant reading.
The negative resolution procedure the Government propose for regulations under clause 1(1) is the least rigorous of all parliamentary procedures available. Secondary legislation subject to the negative resolution becomes law automatically once it has been laid before Parliament and has remained unchallenged for the requisite number of days—no need for a debate, no call for a vote. MPs may pray against any regulation by means of an early-day motion, but there is no obligation for the Government to schedule parliamentary time to debate that prayer.
The convention is that prayers made by Her Majesty’s official Opposition should receive parliamentary time for a debate, yet even then there is no guarantee that the convention will be respected. In the 2015-16 parliamentary Session, the Leader of the Opposition tabled a dozen prayer motions for debate—five were granted. Of the 585 negative instruments laid before Parliament in that session, only 3% were even debated. In the following parliamentary Session, fewer than one in 100 statutory instruments subject to the negative resolution procedure were debated at all.
The main point of the negative resolution procedure is to allow the Government to have their way without any need to bother parliamentary democracy, and it has been spectacularly successful. The last time a negative instrument was successfully annulled in the House of Commons was the Paraffin (Maximum Retail Prices) (Revocation) Order in 1979. I think that tells the story about what is intended by making these provisions subject to the negative resolution procedure.
Faisal Rashid
Almost every individual who has appeared before this Committee over the past week, from business leaders to academics, civil activists and lawyers, has told us that more needs to be done by way of parliamentary scrutiny in this Bill. If the Government will not support these amendments, what good reason do they have to ignore the recommendations of these individuals?
Barry Gardiner
Again, my hon. Friend puts it very succinctly and very well.
The delegated powers memorandum argues that the negative resolution procedure is appropriate to implement the UK’s obligations as an independent member of the GPA. It argues that it would be inappropriate to demand primary legislation to bring in the legislative changes necessary to reflect our new status as an independent GPA member, as this could introduce a significant delay in the proceedings.
Labour Members agree; we are not opposing the Government on that point. Primary legislation would be inappropriate to implement our obligations under the GPA once we had fully debated the terms on which we were joining the agreement, as the Minister promised us last Thursday that we will. Yet the issue here is not primary versus secondary legislation; it is negative versus affirmative in respect of the resolution procedure that governs the secondary legislation.
We simply do not believe that the negative procedure can be appropriate, precisely because of the lasting damage that could be done to contractors currently providing councils with goods and services if the regulations about Government procurement are made wrongly. Nor do we accept the Government’s contention that they must be allowed to use the negative resolution procedure because of time pressures inherent in the GPA itself. It is entirely spurious to suggest that the 30-day period between depositing the UK’s instrument of accession to the GPA and the accession coming into force is in any way coterminous with the drafting of a statutory instrument and its passage through Parliament.
The guidance on drafting statutory instruments issued by the Government Legal Service recommends allowing an absolute minimum of 22 weeks for the very simplest of negative instruments, with more complex ones requiring anything up to 61 weeks from their inception to the time they come into force—that is, well over year. Affirmative resolution instruments require only marginally longer, depending again on how complex they are—the Government Legal Service suggests allowing 26 to 67 weeks. In both cases, the process requires many months of planning beyond the 30-day period stipulated in the GPA. Government officials will have had to start work on the secondary legislation months in advance of depositing the UK’s accession instruments with the WTO, and they can just as easily factor in an affirmative resolution procedure as they can a negative one.
When it comes to the future accession of other WTO members to the GPA, which may well happen, the situation is even more acute. Here, Members of Parliament will have had no opportunity to consider any of the ramifications of opening up our public procurement contracts to new countries. So the only chance we will have of subjecting those new regulations to any scrutiny will come through the procedure that we enshrine in this Bill.
The WTO lists 10 countries that are in the process of acceding to the GPA: Albania, Australia, China, Georgia, Jordan, the Kyrgyz Republic, Oman, Russia, Tajikistan and the former Yugoslav Republic of Macedonia. Five other WTO members have undertaken commitments in their WTO accession protocols to initiate accession to the GPA: Afghanistan, Kazakhstan, Mongolia, Saudi Arabia and the Seychelles. If and when they do accede, the UK will need to open up its Government procurement contracts to suppliers from every one of those countries. Once again, we agree with the Government that it would be overly burdensome to require new primary legislation every time another country accedes to the GPA. We are not asking for that. But we disagree that new Government regulations to implement our obligations should just be passed through on the nod. That is why we are arguing for the affirmative procedure in this case too.
Once again, the Government’s argument that we are constrained by the 30-day period between a country’s accession and our having to grant that country access to the UK’s public procurement market is entirely spurious. We will have been party to the negotiations surrounding their accession for months beforehand, giving Government officials ample time to prepare the requisite instrument for either negative or affirmative resolution.
This is a blunder. Even where a statutory instrument is subject to the affirmative resolution procedure, the scrutiny that it undergoes is still remarkably light. MPs who have previously been assigned to Delegated Legislation Committees—and there will be many in this House—know they are not encouraged by the Whips to engage and speak. The affirmative resolution procedure has been called farcical and a waste of time. The Hansard Society notes, not surprisingly, that this system is “not fit for purpose”. It concludes with the stinging rebuke to all of us who are responsible for the proper functioning of Parliament that
“MPs can no longer be indifferent to the inadequacies in the system. They must now finally take seriously their democratic responsibility for delegated legislation.”
That is why the Labour party has tabled amendments to the Bill calling for an upgrading of the process for parliamentary scrutiny in respect of regulations stemming from our new trade obligations. As we have noted repeatedly, those obligations are serious. They are binding commitments made in international treaties that cannot easily be repealed. Domestic legislation can be repealed much more easily. If there was ever an example of secondary legislation crying out for proper parliamentary scrutiny and oversight, this is it. For the regulations necessary to implement obligations arising from the UK’s independent membership of the GPA, we consider the affirmative resolution procedure to be appropriate and proportionate. However imperfect the system is, at least the affirmative procedure provides Members of Parliament with the possibility of a debate and a vote. It is then up to us to make proper use of that opportunity.
Having heard the objections of such an independent body as the Hansard Society, I hope Government Members will agree with us—on this amendment at least—and support it.
Greg Hands
The UK currently participates in the government procurement agreement, known as the GPA, through our EU membership. The GPA offers UK businesses guaranteed access to approximately £1.3 trillion per annum of global public contract opportunities. We intend to remain in the GPA with the same rights and obligations that we currently enjoy as part of the European Union. Those were negotiated by the EU on behalf of member states for the 1994 GPA. The 2012 revised GPA was negotiated by the EU and scrutinised by the European scrutiny Committees in Parliament.
The power in clause 1 is a narrow one designed to allow us to implement the GPA as an independent member, as well as to reflect new parties joining and crucially—the hon. Member for Brent North rather overlooked this—to allow existing parties to withdraw from it. It will be a case of the UK using clause 1 to reflect having a new status within an existing, established agreement on procurement.
Barry Gardiner
I agree with the Minister’s interpretation of what he has just read out. Does he accept that he also said the following:
“the terms on which the UK enters the GPA in our own right will be subject to a separate vote in Parliament”?—[Official Report, Trade Public Bill Committee, 25 January 2018; c. 131.]
Greg Hands
Hence, the clarification, twice over, to be absolutely precise how that vote would work. I know the hon. Gentleman has attacked the negative resolution procedure, but I do not remember any such exhortation when he was a Minister under Tony Blair—I did not listen to every single thing he said in those years, but I do not recall that. I think he would have troubled the scorers if he had attacked such a procedure at the time under CRAG, which as we know is an Act of Parliament introduced by the last Labour Government.
The hon. Member for Brent North confirmed last week that he did indeed vote for CRAG. He said it was important in the days when the treaties in question had already been scrutinised by the EU and scrutiny was also passed down to
“this Parliament, where the European Scrutiny Committee…would examine forensically the contents passed from Europe”.—[Official Report, Trade Public Bill Committee, 25 January 2018; c. 149.]
I can reassure the hon. Gentleman that the revised GPA in 2012 went through the very process he described to the Committee and the very process that he voted for in 2010.
The hon. Gentleman asked why the GPA power is not time-limited. The answer is that new accessions to the GPA are covered by the clause to ensure that the UK does not breach its own GPA commitments. It is also essential to have the power to reflect withdrawals to ensure that withdrawing parties do not continue to enjoy guaranteed access to UK procurement markets. I will speak in more detail about withdrawals from the GPA.
The hon. Gentleman asserted that the GPA power continues into perpetuity, including the Henry VIII power. There is no Henry VIII power in clause 1, which allows for the implementation of the GPA. The powers in clause 1 are narrow in scope. They are designed to allow the UK to make legislative changes that reflect its new status as an independent member but, none the less, as a member of an existing and settled agreement.
The UK needs to use the power in clause 1 quickly to prevent UK businesses from losing guaranteed access to valuable procurement markets. The revised GPA has already been scrutinised by the EU and the European Scrutiny Committee, using the powerful microscope the hon. Gentleman described last week and for which he voted not so long ago.
Faisal Rashid
Last Thursday my hon. Friend the Member for Brent North spoke of the emails members of this Committee had received from members of the public urging them to amend this Bill to protect our democracy. The number of these emails in my inbox—and, I am sure, in all other Members’ inboxes—has reached just over 5,000. If the Government will not support these amendments to introduce at least some degree of parliamentary scrutiny, what good reason can they give the 5,000 individuals who have taken time to contact us for ignoring their concerns?
Greg Hands
I thank the hon. Gentleman for his intervention, because it allows me to put on the record something that concerned all members of this Committee when they logged on last Tuesday and discovered, seemingly, a large number of emails—hundreds and, in one case, 1,200—about this Bill. I am sure he, in the course of being a good constituency MP, would seek to check whether those emails were, indeed, from his constituents. I have to report that my colleague who received 1,200 such emails discovered, following further examination by his very diligent parliamentary staff, that precisely four of those 1,200 emails came from his constituents.
I would say to the hon. Gentleman that, in respecting parliamentary rules, I would have a close look at those emails and ask where they are coming from. Is the hon. Gentleman, indeed, answerable to these people? All of them will have a Member of Parliament in this House who will be the right person to direct those emails to. Getting 5,000 emails from across Britain in relation to one issue in this Parliament need not necessarily be representative of a wider move against this Bill, which is a technical Bill all about the continuity of our existing trading arrangements.
Faisal Rashid
I thank the Minister for giving me time. This is a national issue; it is not just a constituency-based issue. I understand that there is parliamentary procedure and that we do not have to reply to all those emails if they are not from our constituents. However, surely it tells us, as parliamentarians, that the problems and issues among the general public and in the business environment are quite immense.
Greg Hands
I thank the hon. Gentleman for his intervention. We might be going too far down this road. I do not want to sound in any way condescending to a new Member, and my only advice to him, having been a Member in this House for 12 years, would be that the receipt of 5,000 emails from 650 constituencies is an average of nine emails per constituency. If he is suggesting that we make public policy, and that each of us makes our policy decisions, based on the opinions of nine constituents, I do not believe that would be a helpful road for us to go down.
Returning to the GPA, the UK’s independent membership will be considered under the CRAG process, meaning Parliament will be able to scrutinise the terms of the UK joining the GPA before the GPA can join, as I referred to in the debate on Thursday. The Government therefore believe that the negative resolution procedure provides an appropriate level of parliamentary scrutiny for the power to implement the GPA in clause 1.
Furthermore, the Opposition amendment would also apply the affirmative resolution procedure when the UK uses clause 1 to make regulations to reflect new parties joining the GPA or—this is a very important point—existing parties withdrawing from it. In the case of new and withdrawing parties, it is important that the UK is able to respond quickly and flexibly. Once a new party deposits its instrument of accession, there is a period of only 30 days before that accession comes into force. The UK will then be under an immediate obligation to provide that new party with guaranteed access to UK procurement opportunities covered by the GPA. If the UK failed to offer the new party this guaranteed access, it would be in breach of its GPA commitment. On the other hand, a party to the GPA can decide to withdraw unilaterally, and where a party notifies the GPA committee that they intend to withdraw, they will cease to be a GPA member just 60 days later. Therefore, it is vital we are able to react quickly to such a notification.
If the power to amend UK legislation to reflect parties withdrawing from the GPA were subject to any affirmative procedure, the UK might not be able to legislate in time to remove the party by the 60-day time limit, which, of course, could result in the UK contracting authorities continuing to give guaranteed access to UK markets to a party that is leaving or had already left the GPA, and was therefore no longer entitled to access.
Barry Gardiner
I am listening carefully to the Minister. Does that 60-day timescale for countries seceding from the GPA mean that in those cases the Minister will not be able to fulfil the guidelines for statutory instruments that I referred to? If that is the case, it suggests that at an absolute minimum a statutory instrument, even on the negative procedure that he proposes, would only be for 22 weeks and at the outside for 60 weeks. Is he confirming to the Committee that in those circumstances, the guidelines laid down by the Government and Parliament in this area, even for the negative procedure, would not apply?
Greg Hands
I want to make sure of the answer to the hon. Gentleman’s question. Perhaps I can pledge to write to him, copying in other members of the Committee and you, Mr Davies, on precisely how this fits in with our statutory instrument procedures.
Greg Hands
To conclude, the withdrawing party would have no obligation to give UK businesses reciprocal access to its procurement markets, and it is of course vital that Parliament has the opportunity to scrutinise new accessions to the GPA.
I reassured the Committee last week and earlier today that we want to ensure a clear and significant role for Parliament in scrutinising future trade agreements. The provisions will enable those agreements to be completed effectively and efficiently, while respecting due process in Parliament. New accessions to the GPA will be included within that scrutiny process. That will ensure that Parliament can scrutinise new accessions during accession negotiations. The power that we are discussing will be used after that scrutiny, and approval of the accession, so I invite the hon. Member for Brent North to withdraw the amendment.
Barry Gardiner
I am grateful to the Minister for his assurance that he will write to the Committee, but I will press the amendment to a vote, because it makes an important point.
Question put, That the amendment be made.
Barry Gardiner
I beg to move amendment 16, in schedule 2, page 12, line 5, leave out “or 2(1)”.
This is linked to amendments 14, 15, 17, 19 and 20.
The Chair
With this it will be convenient to discuss the following:
Amendment 14, in schedule 2, page 12, line 6, at end insert—
“(1A) A statutory instrument containing regulations of a Minister of the Crown under section 2(1) in respect of a free trade agreement which meets the criteria under section 2(3) may not be made unless all provisions of paragraph 2A have been satisfied.”
This amendment is linked to amendments 15 and 16, which would require the United Kingdom’s free trade agreements with third countries which already have a corresponding agreement with the European Union to be subject to a super-affirmative resolution procedure prior to ratification.
Amendment 15, in schedule 2, page 12, line 17, at end insert—
“Scrutiny of corresponding agreements: super-affirmative procedure
2A (1) Before a free trade agreement which meets the criteria under section 2(3) and to which the United Kingdom is a signatory may be ratified, the Secretary of State must lay before Parliament—
(a) a draft order to the effect that the agreement be ratified, and
(b) a document which explains why the Secretary of State believes that the agreement should be ratified.
(2) The Secretary of State may make an order in the terms of the draft order laid under subparagraph (1) if—
(a) after the expiry of a period of 21 sitting days after the draft order is laid, no committee of either House of Parliament has recommended that the order should not be made, and
(b) after the expiry of a period of 40 sitting days after the draft order is laid, a motion in the terms of the draft order is approved by a resolution of each House of Parliament.
(3) If a committee of either House of Parliament recommends that an order should not be made under subparagraph (2), the Secretary of State may, after the expiry of a period of 60 sitting days after the draft order is laid, make a motion for a resolution in each House of Parliament in the terms of the draft order.
(4) If a motion in the terms of the draft order is approved by a resolution of each House of Parliament under subparagraph (2)(b) or (3), the Secretary of State may make an order in the terms of the draft order.
(5) A free trade agreement to which this paragraph applies shall not be deemed to be a treaty for the purposes of Part 2 of the Constitutional Reform and Governance Act 2010.
(6) In section 25 of the Constitutional Reform and Governance Act 2010, after subsection (1)(b), at end insert—
‘but does not include a free trade agreement to which paragraph 2A of Schedule 2 to the Trade Act 2018 applies.’”
This would require the United Kingdom’s free trade agreements with third countries which already have a corresponding agreement with the European Union to be subject to a super-affirmative resolution procedure prior to ratification.
Barry Gardiner
Let me state for the record that I am grateful to you, Mr Davies, and to the Clerks for agreeing to the reordering that we requested, so that amendments 14 and 15 could be selected with amendment 16, and debated ahead of amendments 17 and 19. I will try to make it clear why that is necessary.
Faisal Rashid
The super-affirmative procedure closely replicates the powers that MEPs enjoy in the European Union, so does my hon. Friend agree that if the Government are to meet their commitment that the Bill will replicate existing arrangements as closely as possible, they must support the amendment?
Barry Gardiner
Again, my hon. Friend makes the point about the discrepancy between the scrutiny available to us here in this sovereign Parliament and the scrutiny available to members of the European Parliament. It would seem entirely at odds with the Government’s stated purpose for the European Union (Withdrawal) Bill if we ended up having fewer scrutiny powers than Members of the European Parliament. That would seem to be a travesty.
I look forward with perhaps slightly more than the usual expectation to the Minister’s response to the amendment, given that this is the issue on which not only the right hon. and learned Member for Beaconsfield spoke on Second Reading, but on which several other hon. Members from across the House registered their profound concern. This is the moment when we discover whether the Government are prepared to heed the calls of right hon. and hon. Members alike and look at the Bill in a much more sensible way.
Greg Hands
Let me reassure hon. Members that I listened very carefully to what the hon. Member for Brent North said. First, let me repeat that the majority of free trade agreements within the scope of the Bill have already been ratified, and Parliament had the opportunity to scrutinise them during ratification. Parliament’s European Scrutiny Committee also scrutinised these agreements when they were negotiated, included, signed and provisionally applied. They had, of course, already gone through the European Parliament process as well, to which the hon. Member for Warrington South helpfully drew our attention.
The Government have made clear their intention to ratify by exit date all the EU free trade agreements that currently provisionally apply, including the EU-Canada comprehensive economic and trade agreement, and the economic partnership agreement with the Southern African Development Community, or SADC.
The hon. Member for Brent North drew attention to the comments of a South African Minister. To be honest, I cannot remember precisely whom he referred to, but for clarity I refer him to the memorandum of understanding signed by the Secretary of State for International Trade in South Africa in either August or September. Both parties specifically agreed to transition the agreement and maintain continuity, without substantive change. Whatever the hon. Gentleman’s South African said, the memorandum of understanding is absolutely clear in that regard. As I said to the International Trade Committee last week, 70-plus countries have agreed in principle to maintain continuity in trading arrangements. For example, we signed a similar memorandum with the CARIFORUM group to do precisely that.
Parliament’s scrutiny of these agreements, which have already been scrutinised, will be guaranteed by the process under the Constitutional Reform and Governance Act 2010. As we have made clear, this is a technical exercise to secure continuity in our existing trading arrangements, not an opportunity to renegotiate the terms of existing agreements. That means that further scrutiny of those agreements, the benefits of which are already felt by businesses and consumers, is unnecessary. As we have made clear, we want Parliament to play a vital role in the scrutiny of future trade agreements that are not covered by the Bill, but that is for a separate occasion. We made clear in the trade White Paper and in this Committee on Thursday that our future trade policy must be transparent and inclusive.
Faisal Rashid
We heard from many witnesses last week that so-called roll-over agreements not only will be legally distinct from our existing EU agreements, but are likely to be substantially different in their terms. Does the Minister agree that those new agreements need to be subjected to adequate scrutiny and parliamentary oversight, and that a super-affirmative procedure is appropriate?
Greg Hands
I thank the hon. Gentleman for his intervention. I very much appreciate the way, as a new Member, he is getting stuck into the Bill, but I remind him that, in terms of securing the continuity of agreements, more than 70 countries have now agreed that there will not be substantive change. I mentioned South Africa, with which we have a memorandum of understanding saying that. There is no need to re-scrutinise agreements that are substantively the same and have already been through the proper scrutiny processes of both Houses. That is why we made clear in the trade White Paper and in this Committee on Thursday that our future trade policy must be transparent and inclusive, and that Parliament will be engaged throughout the process. I therefore ask the hon. Member for Brent North to withdraw amendment 16.
Barry Gardiner
We intend to press amendment 16 to a vote.
Question put, That the amendment be made.
Barry Gardiner
I beg to move amendment 17, in schedule 2, page 12, line 6, at end insert—
“(1A) A statutory instrument containing regulations of a Minister of the Crown under section 2(1) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”
This would require regulations implementing international trade agreements to be subject to the affirmative resolution procedure.
The Chair
With this it will be convenient to discuss amendment 19, in schedule 2, page 12, line 6, at end insert—
“(1A) A statutory instrument containing regulations of a Minister of the Crown under section 2(1) may not be made except in accordance with the steps in subparagraphs (1B) to (1E).
(1B) The Minister shall lay before Parliament—
(a) a draft of the regulations, and
(b) a document which explains why the Secretary of State believes that regulations should be made in terms of the draft regulations.
(1C) The Minister may make an order in the terms of the draft regulations laid under subparagraph (1B) if—
(a) after the expiry of a period of 21 sitting days after the draft regulations are laid, no committee of either House of Parliament has recommended that the regulations should not be made, and
(b) after the expiry of a period of 60 sitting days after the draft regulations are laid, the draft regulations are approved by a resolution of each House of Parliament.
(1D) If a committee of either House of Parliament recommends that the regulations should not be made, the Secretary of State may—
(a) lay before Parliament revised draft regulations, or
(b) after the expiry of a period of 40 sitting days after the revised draft regulations are laid, make a motion for a resolution in each House of Parliament for approval of the draft regulations.
(1E) If a motion under subparagraph (1D)(b) is approved by a resolution of each House of Parliament, the Secretary of State may make the regulations.”
This would require regulations implementing international trade agreements to be subject to the super-affirmative resolution procedure.
Barry Gardiner
Amendment 19 would require any regulations implementing new UK trade agreements to be subject to a super-affirmative procedure. If the Government are not willing to allow us the super-affirmative procedure prior to ratification, as they have just shown they are not, we will be compelled to argue for it afterwards. Clearly, we would prefer to keep the stable door shut rather than having to retrieve the horse after it has bolted, but if we could at least provide for some parliamentary process subjecting implementing regulations to scrutiny, that would be better than nothing. As it is presently constituted, nothing is precisely what the Bill offers.
The procedure mirrors that which we seek to introduce with amendment 15: namely, in this case, a proper process granting Parliament the power to subject implementing regulations to scrutiny. The provisions are drawn from existing primary legislation that provides for enhanced scrutiny in other contexts. Once again, the key elements of them are that a Committee of either House can object to the regulations, and that both Houses must give their approval before the Secretary of State can proceed with making the regulations.
Greg Hands
I think we are potentially about to have quite a similar debate to the one that we just had, but let me be as succinct as I can. I remind Members that this power will be used only to introduce regulations that reflect current obligations in our EU trade agreements. That means that we are not seeking to change the effects of our existing trade agreements through the power. The agreements have already been examined by Parliament as part of its regular scrutiny of EU business. Ratified free trade agreements have already been through the normal parliamentary scrutiny process for treaty ratification.
Barry Gardiner
The Minister said that the Government are not proposing to change the provisions in any of the treaties. I think he said earlier in our debate that 71 countries had already agreed. Could he just clarify for the Committee once and for all, because he has failed to do so thus far, whether that includes Norway, Switzerland and Turkey?
Greg Hands
I thank the hon. Gentleman, but we have already covered that ground as well. The agreements with Norway, Turkey and Switzerland will inevitably be dependent on our future trading relationship with the European Union, because of the unique way that each of those countries operates in conjunction with the European Union.
The hon. Gentleman says that we are not proposing changes. It is just as important to recognise that more than 70 of our partners do not want substantive changes to the agreements either. Perhaps we need to put aside for a moment some of the ways in which the Bill operates, and think about what is in the interests of our trading partners. It is as much in their interests as ours to have continuity of the existing agreements. It is therefore not a surprise to me that more than 70 countries have said that they are not seeking substantive changes to the agreements.
Matt Western (Warwick and Leamington) (Lab)
I appreciate the point that the Minister seeks to make. However, as he says, there are 70 of them and one of us. In any negotiation, the disadvantage is always with the minority. We are going to be in a very difficult position. One could well imagine—this point came up at the International Trade Committee last week—that the opportunity exists for those nations to renegotiate or, recognising the time pressure that we will be under, to make changes. Surely it should be for Parliament to consider any such change to a trade agreement, not for the Minister or a select few.
Greg Hands
The hon. Gentleman puts his question in a reasonable way. I know he is a member of the International Trade Committee and was there for the evidence session last Wednesday. However, it is not the case that we and the 70-plus countries are in some kind of plurilateral agreement. The number he talks about is the number of agreements, not the number of negotiating partners to that same agreement. Essentially, they would run the same risk that we would run if anyone were to want to renegotiate the agreement. The risk is that we would run out of time to have the transitioned agreement in place come the day that we leave the European Union. We have as much risk and as much downside as the counterpart does. That is the important thing to understand. The Government therefore consider the negative procedure to offer the appropriate level of further scrutiny over the operation of the power.
Turning to amendment 19, as we have made clear, the purpose of the Bill is to help maintain the effects of our existing trading arrangements as we leave the EU. It is vital that we secure that continuity without delay, to avoid disruption for businesses and consumers. That is why we are seeking a power that ensures that our transitioned trade agreements can be implemented in the nimblest and most efficient way possible, through the negative resolution procedure. A switch to the super-affirmative procedure would risk undermining that objective. Statutory instruments subject to the super-affirmative procedure may take even longer than using primary legislation to implement a transitioned agreement, which would therefore increase the risk of a cliff edge in our trading relationships.
Matt Western
Just to clarify—the Minister can correct me if I am wrong—the agreements will in many cases be trilateral because of our existing relationship with the EU and the relationship with the other country among the 70-plus the Minister mentioned. There is therefore an opportunity for that other country to make the negotiation or arrangement difficult. That is why we are seeking to put in place scrutiny in Parliament.
Greg Hands
I refer the hon. Gentleman to the comments I made earlier: none of the 70-plus countries that we have spoken to has said that it wants to do that. It would not be in their interests for them to do so, for reasons of maintaining continuity in our trade relations. That is very much in our and their interests.
Let me finally remind the Committee that Parliament still has oversight of statutory instruments introduced under the negative resolution procedure, using well-established processes as outlined in CRAG. I therefore ask the hon. Member for Brent North to withdraw the amendment.
Barry Gardiner
We will press amendment 17 to a vote.
Question put, That the amendment be made.
Barry Gardiner
I beg to move amendment 20, in schedule 2, page 12, line 6, at end insert—
“(1A) A statutory instrument containing regulations of a Minister of the Crown under section 2(1) relating to an international trade agreement other than a free trade agreement which does not meet the criteria under section 2(4) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”
This would require regulations implementing an international trade agreement which is not a free trade agreement and which does not correspond to a prior or existing EU agreement to be subject to the affirmative resolution procedure.
This is the final amendment in our series trying to introduce just a modicum of parliamentary scrutiny into the Bill. It refers to the last category of trade agreements that have not yet been covered in the previous amendments.
If hon. Members cast their minds back to amendment 3, which we presented in the first line-by-line sitting last Thursday, that amendment sought to expand the remit of the Bill to include not just agreements that correspond to existing EU agreements but those with countries where there is no prior EU agreement in place. The major set of amendments that I presented at that sitting sought to introduce a full process of preparation, debate and scrutiny up to the point of signature of free trade agreements within the category of comprehensive agreements that need to be notified under GATT article XXIV or GATS article V. Amendment 20 picks up on trade agreements that are not free trade agreements for the purposes of GATT article XXIV or GATS article V, and that do not correspond to an existing EU agreement. Without the amendment, they would not be covered anywhere in the expanded Bill as we envisage it.
We do not believe that it would be an appropriate use of parliamentary time to subject every new mutual recognition agreement to the full rigour of impact assessment and mandate-setting parliamentary scrutiny. We believe it would be enough to have the minimum scrutiny of the affirmative resolution procedure, which allows for a debate and vote where it is thought necessary, but which also allows for the swift passage of regulations through Parliament where they are clearly non-controversial.
I will point out here that some mutual recognition agreements and other agreements are potentially very controversial. In the case of mutual recognition agreements with countries whose regulatory systems are radically different from our own, such as the United States, there could be huge pitfalls in allowing for mutual recognition where it could lead to products entering the UK market that have not been subjected to the rigorous tests that we demand in our jurisdiction. If anything, we are erring on the side of being too pragmatic in suggesting that those agreements be subjected to the affirmative resolution procedure only, seeing as the affirmative procedure can be open to the abuse I described earlier in my reference to the Hansard Society’s report. At least we can take comfort in the fact that a Delegated Legislation Committee would have the power to hold the most controversial regulations up to scrutiny and subject them to a vote in Parliament, which would be a quantum leap from what the Bill currently offers.
Greg Hands
Clause 2 would limit the scope of agreements on which the power can be used to those where the other party had a free trade agreement signed with the EU before exiting. Amendment 20 would establish a procedure whereby the power is used in relation to agreements falling outside those parameters. As we do not wish to extend the scope of clause 2 to allow the power to be used in relation to more agreements, it follows that we do not need to apply a procedure to the implementation of such agreements. The amendment, therefore, is unnecessary in every way.
However, if the spirit of the amendment is to explore what constraints we have drafted into the clause 2 power, I am happy to provide reassurance to the Committee. As I have said before, the power can be used only in relation to free trade agreements with countries that have signed EU free trade agreements before exit day. A free trade agreement covers substantially all trade notifiable to the World Trade Organisation. To be clear, the power cannot be used to amend primary legislation except when that primary legislation is retained EU law. It cannot be used to implement a trade agreement between the United Kingdom and the European Union itself. Nor can it be used to extend or create new criminal offences or create new fees or charges.
The power has a five-year sunset clause from exit day. If the Government wish to extend this period, they may do so only with the permission of both Houses. We and our trading partners are clear that this will be a technical exercise to ensure continuity in trading relationships. It is not an opportunity to change or renegotiate the terms of these EU agreements. Therefore, I ask the hon. Member for Brent North to withdraw the amendment.
Barry Gardiner
I do not wish to shock the Committee, but we will not press the amendment to a vote. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Mr Mark Prisk (Hertford and Stortford) (Con)
I will not detain the Committee for long, but it is important when we establish a new authority to step back. Some of these issues will be raised in debates on amendments, so I will not get too far into the detail.
I strongly support the creation of the Trade Remedies Authority. As our trade policy is slowly developed in the months and years to come, we will need it to be underpinned by a robust remedies regime. Certain characteristics of the authority are very important, and it would aid the interpretation of the Bill in due course if the Government’s aims and intentions were set out on the record.
For an authority to be effective, it needs certain characteristics. First, it needs to be objective and evidence-based. I think that most Members would agree with that in general, but it becomes far more difficult when there is an acute case that is difficult in our constituencies or is of a totemic nature nationally. We need to be clear when we establish the authority that it should be objective and evidence-based in its deliberations and when advising Ministers.
Secondly, the organisation needs to have a broad base. It needs to be open and accessible. All stakeholders must feel that they are able to engage with the authority, and that they are listened to by its whole structure. We have heard examples of authorities in other countries. I simply say that I want to ensure that the consultation process includes not just the business world, but the workers whose jobs may well be threatened and consumers, whom we heard mentioned in evidence. I hope that the Minister can confirm that it will. Many of these issues require a balance between those two sides, and we need to ensure that we have such a balance. It is also important that the authority listens and is seen to listen. The characteristics I have touched on—objectivity, broadness and inclusivity—are important if the authority is to be recognised both here in the United Kingdom and by our trading partners abroad.
The third characteristic is efficiency—or timeliness, as some lawyers describe it. I always find it entertaining when lawyers describe timeliness. Efficiency is of course in tension with the idea of a broad consultation, but we are all aware that there will be cases where prompt action is required, so it is necessary to have good processes in place. Although those will clearly come later, it is important that we put that on the record at this stage, and we would benefit from hearing from the Minister about that.
The most important characteristic, however, is independence. We have heard on Second Reading and in Committee that we all want the authority to be independent and that, naturally, it should be at arm’s length from the Government—the current Administration and future Administrations—for many years to come. That is right, but if it is to be effective, the authority also needs to be able to withstand the media and political pressures that will arise when individual cases come forward. We must ensure that the structure that the Bill builds is robust enough to withstand those pressures. That is why the authority’s non-executive members must be appointed on the basis not of sectional interest but of merit.
We will debate in due course whether the non-executive members should include people from Wales or Scotland, or trade unionists. There are merits to ensuring that the authority listens to all such interests, but I worry that if non-executive members are appointed because they represent one sectional interest or another, the authority’s ability to give independent, objective advice to the Government will be limited. We will come on to the details of that when we debate amendments, but that is an important broad principle.
I strongly believe that if we are to have a remedies authority and an effective set of remedies rules, we need to ensure that those principles are clearly set out not just in legislation but by Ministers and those who are appointed to the authority, so that people both here and abroad can see that that is the intention. I think that would also answer some of the concerns about whether the authority will listen to workers through the trade union movement, by ensuring that consultation is broad and that the authority is clearly outward facing.
It comes back down to this last point: if we want others to follow the rules in trade, so that we have a free and fair system, we have to be seen to abide by those rules ourselves. There will come a moment when this authority reports to a Minister, when there will be a totemic business that is right on the cusp because of a particular practice, or there will be job losses that sharply affect a community that has already lost many jobs. At that moment, the test of the authority is whether it is objective. Is it giving its advice to Ministers on the basis of evidence? Is it genuinely independent and therefore able to be trusted by people here and abroad? Those are important principles and I welcome the Minister’s response.
Greg Hands
No.
Mr Davies, I would like to start by stressing that the Government recognise the important role of making sure—that you are in the right place at the right time. [Laughter.]
I will respond to my hon. Friend the Member for Hertford and Stortford because he raised some incredibly strong points. Free trade is not trade without rules, as the Secretary of State outlined on Second Reading. It is vital for us to have the ability to conduct and operate trade remedies. That is the position we need to be in. I am therefore doubly if not triply surprised that the Opposition voted against creating this body on Second Reading.
My hon. Friend outlined—I know that we will come on to debate some of this when we consider the amendments—some of the key parameters that we want in the Trade Remedies Authority, in that it needs to have regard to a wide variety of stakes and interests in this whole process: businesses, workforces, consumers and so on. We need to make sure that our regime is robust in this space.
It is also important for the message we send abroad, because Members know that free trade has been questioned by more and more countries over the last five to 10 years. Many countries are looking at what the UK does generally in trade policy—and that includes trade remedies—to show that we are committed free traders. People are looking forward to the UK rectifying its own schedules at the World Trade Organisation as we retain and regain our independent voice there to make these points. Trade remedies are a vital part of that and it would be folly for the UK not to have a proper arm’s length trade remedies authority that can do this.
As for my hon. Friend’s points on efficiency and promptness, regarding some of the detail of the Trade Remedies Authority’s operations, I advise him to have a look at what is going on with the Taxation (Cross-Border Trade) Bill, which incorporates a lot of the day-to-day workings of the Trade Remedies Authority and is being debated as we speak in another room. Most of all, regarding his important points about the independence and arm’s length nature of this body, it is incredibly important to ensure that we have specialists on it who can withstand pressures, non-executives appointed on merit and not representing sectional interests. We need to make sure that our Trade Remedies Authority members can consider UK-wide issues, but also regional issues at the same time, without being beholden to a particular sector or region. Our objective is therefore to have an independent, evidence-based approach to trade remedies.
Question put and agreed to.
Clause 5 accordingly ordered to stand part of the Bill.
Schedule 4
The Trade Remedies Authority
Bill Esterson (Sefton Central) (Lab)
I beg to move amendment 21, in schedule 4, page 14, line 24, leave out line 34 and insert—
“(a) a member to chair it, appointed by the Secretary of State with the consent of the International Trade Committee of the House of Commons,”.
This would establish the requirement for Parliament, through the relevant committee, to give its consent to the Secretary of State’s recommendation for appointment to the Chair of the Trade Remedies Authority.
The Chair
With this it will be convenient to discuss the following:
Amendment 39, in schedule 4, page 14, line 34, at end insert
“with the consent of each devolved authority,”.
This amendment would require the Secretary of State to secure the consent of each devolved authority before appointing the Chair of the TRA.
Amendment 38, in schedule 4, page 14, line 34, at end insert—
“(aa) a non-executive member appointed by the Secretary of State with the consent of the Scottish Ministers,
(ab) a non-executive member appointed by the Secretary of State with the consent of the Welsh Ministers,”.
This amendment would require UK Ministers to secure the consent of the Scottish Ministers and Welsh Ministers to one non-executive member each of the Trade Remedies Authority.
Amendment 22, in schedule 4, page 15, line 2, leave out subsection (3) and insert—
“(3) No person may be appointed as a non-executive member of the Authority under subparagraph (1)(b) unless—
(a) the Secretary of State has first consulted the Chair of the Authority on the proposed appointment, and
(b) the International Trade Committee of the House of Commons has consented to the appointment.”
This would establish a procedure for appointing non-executive members of the Trade Remedies Authority other than the Chair.
Amendment 23, in schedule 4, page 15, line 3, at end insert
“(3A) In making any proposal under subparagraph (3), the Secretary of State must ensure that there is on the Authority a representative of —
(a) producers,
(b) trade unions, and
(c) each of the United Kingdom devolved administrations.”
This would ensure that the Trade Remedies Authority must include, among its non-executive members, representatives of stakeholder bodies potentially affected by its recommendations.
Amendment 40, in schedule 4, page 16, line 20, after “may” insert
“, with the consent of each devolved authority,”.
This amendment would require the Secretary of State to secure the consent of each devolved authority before removing a person from office as the chief executive of the TRA.
Amendment 41, in schedule 4, page 17, line 27, at end insert—
“Offices
25A The TRA shall maintain offices in—
(a) Scotland,
(b) Wales, and
(c) Northern Ireland.”
This amendment would require that the TRA shall maintain offices in Scotland, Wales and Northern Ireland.
Bill Esterson
It is interesting that the hon. Member for Hertford and Stortford chose to speak in the clause 5 stand part debate, because many of the points he made relate to amendments 21, 22 and 23, which I now speak to on behalf of myself and my hon. Friends. During his interesting and thoughtful speech, he made very strong arguments in favour of each of our amendments. He spoke of the need to be evidence-based and objective, which would be much easier achieved by the balanced membership proposed by our amendments. Equally, he spoke of the need for a broad-based membership—I agree. He also made the argument for balancing the different interests that are involved in delivering trade remedies and an effective Trade Remedies Authority. I will be interested to see how he votes, given that he made the case for supporting each of our three amendments.
As ever, the Minister reminds us of the vote on Second Reading. He neglected to say that in our reasoned amendment we called for the need for effective legislation to implement the establishment of a Trade Remedies Authority to deliver the new UK trade remedies framework. We voted for that, and he voted against it. If he wants to tell me why he voted against an amendment that called for the establishment of a Trade Remedies Authority to deliver the new UK trade remedies framework, he can do so now.
Greg Hands
I thank the hon. Gentleman for allowing me to do so. We all know that the usual purpose of a reasoned amendment is that it allows an Opposition party to put forward a point of view about a Bill while nevertheless still allowing it not to oppose the Bill itself. That is the standard way in which reasoned amendments operate. We were simply amazed that once his reasoned amendment fell he nevertheless opposed the Bill. That shows that he opposes the continuity of these trade agreements, the creation of a Trade Remedies Authority, and data-sharing powers that will help our exporters. I am afraid that that is on the record from his vote on Second Reading.
Bill Esterson
I am glad that the Minister has confirmed that we voted to support the creation of a Trade Remedies Authority and that he voted against it. I think that was very clear in that lengthy intervention.
As the explanatory statements make clear, amendments 21, 22 and 23 would have the effect of giving Parliament the power of consent over the appointment of a chair to the Trade Remedies Authority set up by the Bill. They would establish a procedure for the appointment of non-executive members to the authority, and ensure that the TRA includes representatives of key stakeholder bodies among its non-executive membership—all things that the hon. Member for Hertford and Stortford requested.
Mr Prisk
I actually said that the non-executive members need not to be beholden to a sectional interest and they need to be able to make a corporate decision. My worry is that amendment 23 does precisely the former. There are some 5.3 million people in the west midlands and some 5.6 million in Scotland. Presumably, according to the logic with which the hon. Gentleman has drafted the amendment, we should also have somebody from the west midlands. I am sure that people from Yorkshire would then like to have someone from Yorkshire. My concern is that ultimately we will end up with one person representing not the broad picture, but a sectional interest. I am very happy to have people who have links and connections to those areas, but to appoint them on the basis of where they come from or to represent one sectional interest would be wrong. Merit should win.
Bill Esterson
Perhaps the appointment of the non-executives can cover all those areas.
Trade remedies and the Trade Remedies Authority are a key element of our trade policy. Gareth Stace of UK Steel told us in one evidence session that
“If we get this very wrong, we become the dumping ground—not just in Europe, but for the rest of the world.”–––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 66, Q127.]
It is therefore essential that we get it right, and the Bill is our opportunity to do that. The Government have spent the past few days in Committee trying to convince us that the Bill is a technical little Bill that is not trying to do much other than put in place necessary frameworks. On the Trade Remedies Authority in particular, they have gone to great pains to stress that they are simply setting up the necessary structures to carry out our trade defence once we have left the European Union. This much is true: the Trade Bill does set up the Trade Remedies Authority, which will be a key component of our trade policy once we leave the European Union, when we have to carry out our own trade remedies.
Hannah Bardell
I thank the hon. Gentleman for giving way—that was a clash of interventions and I am glad to have won the battle. I absolutely agree with him. Does he agree with me that, although none of us, unfortunately, has tabled the amendment that has just occurred to me, the authority should reflect the gender balance of society? Perhaps there should be a gender balance mechanism, as it will be a public body.
Bill Esterson
It is really important that we take on the challenge set by the hon. Lady and apply it to all public bodies. How we achieve such a gender balance is perhaps a question for wider discussion, but her point is well made. The Minister might achieve the balance she suggests when he creates the authority.
Faisal Rashid
The role of Parliament in overseeing the creation of the Trade Remedies Authority was described to the Committee as “critical” by Chris Southworth of the International Chamber of Commerce. Does my hon. Friend share my concerns that if the Government do not support the amendment, they are clearly choosing to ignore the voice of the ICC? Does he also share my concerns about the repercussions that that might have for the future of UK trade?
Bill Esterson
My hon. Friend makes an excellent intervention, as he has done throughout Committee. That body has to carry the confidence of all sides of industry and all parts of society and of the United Kingdom. It is crucial that it does so, which is why we are attempting to push the amendments through. I imagine, from what the Minister has said, that he is unlikely to support us—why change the habit? Perhaps, however, he will explain how those points will be addressed and how the Government will respond to the witnesses mentioned by my hon. Friend, as well as some of the other witnesses.
The Minister is not letting on that trade remedies are not simply a technical detail of trade policy. They have the potential to be highly political. In essence, trade remedies defend domestic producers from unfair competition from dumped goods from other countries. The remedies are an essential policy tool to correct multilateral distortions, as Mr Stevenson, the specialist adviser to the Manufacturing Trade Remedies Alliance told us last week. Deciding when and how to use such trade defence instruments, however, is a political decision, and a highly political one at that, as is that on the membership of the TRA. It is crucial to get the membership right, to ensure that the TRA makes correct, balanced and evidence-based recommendations—as the hon. Member for Hertford and Stortford put it—to Government.
As the system is to operate under this Bill and the Taxation (Cross-border Trade) Bill, the Secretary of State has the capacity to use an economic interest test to allow the Government not to take action even when problematic trade behaviour by another country has been identified. In other words, the Government will have the capacity to decide that even when harm is being done to our domestic industries, other interests such as the consumer interest may outweigh those of the producers affected. To quote the words of George Peretz, QC, who we heard from last week:
“That seems to me to be a political position: it is balancing the interests of jobs in a particular area of the country against the interests of consumers across the country”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 55, Q105.]
The same point was made on Second Reading by a number of hon. Members, including about the Scotch whisky and steel sectors.
The Minister cannot pretend that the Bill and the structures created by it are apolitical and purely technocratic. Trade remedies can make the difference between the survival of an industry and its decimation. They can protect thousands of jobs or let them be exported overseas. They can defend our foundation industries or let them fall by the wayside. I am sure the constituents of the hon. Member for Corby can attest to that.
Bill Esterson
The hon. Gentleman comments from a sedentary positon; perhaps he is allowed to do that.
Alan Brown
I just want to respond to the comments made by the hon. Member for Corby from a sedentary position. It is ironic that he is saying yet again that we should have voted for the Bill on Second Reading and then tabled amendments, even though the Government have voted against every single amendment.
Bill Esterson
The hon. Gentleman is of course right. I remind the hon. Member for Corby and his colleagues that he and they all voted against our reasoned amendment, which called for the setting up of the Trade Remedies Authority.
Trade remedies are absolutely essential in order to protect British industries, including the steel sector, ceramics, tyres, chemicals and pharmaceuticals. As Gareth Stace of UK Steel told us,
“Trade remedies...are the safety valve that enables free trade to take place.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 66, Q127.]
One need only look at the steel sector to understand why trade remedies are necessary and also how incredibly political they can be.
As the steel crisis highlighted, when no trade remedies are put in place to defend our steel industry against dumping from countries such as China, thousands of jobs are lost and entire communities are negatively affected. We were reminded of that at BEIS questions earlier today, when my hon. Friend the Member for Redcar (Anna Turley) raised the ongoing devastating impact on the community and workers who lost their jobs at SSI. She spoke of the continuing struggle to replace their jobs and to create prosperous alternatives for her constituents. So far, that has not been resolved.
During the steel crisis the Conservative Government under David Cameron acted as the ringleader of a group of countries in Europe trying to block efforts at the European Council to put in place more rigorous anti-dumping measures against China by lifting the lesser duty rule. British steel was going through an existential crisis and the Conservative Government did not use all the policy tools available to them to restore a level playing field. The EU ended up imposing tariffs on unfairly traded steel, but they were much lower than those imposed by other countries such as Australia and the USA.
Now that we are leaving the European Union the Government have rightly set out to create an independent trade remedy regime, yet they seem to not have left their bad habits behind. They still envisage having a lesser duty rule in place. On top of that, they have introduced an economic interest test in the Taxation (Cross-border Trade) Bill. Once again British producers do not make it to the top of the list of concerns for the Secretary of State and Ministers. They seem to want to champion only consumer interests. That is why we believe it is important that Parliament has a say in the appointments to the Trade Remedies Authority and why we believe non-executive members of the TRA should include representatives of producers and trade unions from each of the devolved Administrations. There needs to be an in-built system of checks and balances so that all interests are taken into consideration and all voices are heard. As Mr Southworth from the International Chambers of Commerce said on Tuesday last week, issues such as steel dumping have
“huge implications for a lot of people, particularly in geographies that tend to be vulnerable...It is important that everyone has a chance to have their say about what that decision should be.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 26, Q57.]
Even in the short time that the Department for International Trade has been in existence, its track record on being inclusive and mindful of the input of stakeholders has not been ideal. The consultation on the Trade Remedies Authority ended on the evening of 6 November. By early morning on the 7th, the Trade Bill had been published and delivered to Parliament. James Ashton-Bell of the CBI diplomatically said that
“the optics were not ideal.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 34, Q79.]
What a disgrace. Why did the Government bother to have a consultation when they clearly had no intention of reading the responses, let alone taking on board the suggestions? That is a clear breach of the consultation principles issued to all Departments in 2016.
Greg Hands
I have a quick question: does the hon. Gentleman agree with his party leader that free trade itself is a dogma?
Bill Esterson
I think we should press on. The Minister has enough to worry about.
As Mr Stevenson of the Manufacturing Trade Remedies Alliance told us last week:
“Some see trade remedies as purely protectionist and would abolish them completely”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 65, Q124.]
It is key, therefore, that Parliament, through its relevant Committee, should get to scrutinise who the Secretary of State appoints as the head of the relevant body, and that it should make sure it is someone with the competence, experience and disposition to stand up for the best interests of British industries and the British people.
Similarly, amendment 22 would ensure that the Secretary of State cannot appoint non-executive members to the TRA at his whim and fancy. He should not be able to stack the TRA with members of a certain political and ideological persuasion that would mean they would be less likely to act on complaints brought forward and less likely to recommend measures. We heard from Mr Stevenson of the MTRA last week that if all its members
“thought trade remedies were protectionist, we would never get any trade remedies through”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 65, Q124.]
Parliamentary scrutiny of the membership of the TRA is even more important in the light of the evidence given to this committee by Mr Tom Reynolds of the British Ceramic Confederation. He highlighted to us at column 67 that, within the context of our membership of the European Union, the UK Government took on the role of the “liberal counterweight” opposing strong trade defence measures. However, now that we will not have the other 27 member states, of which a majority is for trade remedies, we cannot afford to take the same approach.
Unfortunately, according to Mr Reynolds, UK civil servants and experts are “steeped in that heritage” of the UK being a neo-liberal counterweight. We cannot afford to let that institutional memory dictate how our independent trade defence policy is conducted. We need to ensure that the non-executive board of the TRA is a watchdog that ensures balance in the system. The only way to do that is to allow this House, through the appropriate Committee, to have a say on the appointment of the board members.
Finally and most importantly, amendment 23 would ensure that the TRA includes among its non-executive members representatives of stakeholder bodies potentially affected by the recommendations of the TRA. Those stakeholders are the producers, the trade unions representing the workers and a representative of each of the devolved Administrations. We have put that into our amendment because we believe that the key stakeholders affected by unfair trading practices should be represented around the table where decisions are being made that affect the survival of their industries and jobs, and the wellbeing of their communities. The TRA will only be enriched by experts from industry, trade unions and the devolved Administrations, who are the ones facing the realities of dumping on a day-to-day basis and close to home.
Matt Western
Does my hon. Friend have a view on the recent situation with Bombardier and the involvement of the US trade body that found in its favour? Are there any learnings from that? I am specifically interested in the role of the unions on that body, as well as industry representatives.
Bill Esterson
My hon. Friend is right to raise that. The Bombardier experience shows that countries are prepared to apply very significant trade remedies. We have to be realistic. We need to be in a position to have our own trade remedies system, be prepared to use them and not expect that not using such processes is always appropriate. That is why we must have the right membership, including from the trade unions, to protect jobs, as my hon. Friend has said, because otherwise we leave ourselves wide open.
Greg Hands
Can the hon. Gentleman be absolutely clear? I am intrigued. Is he saying therefore that he agrees with the US approach—not having a lesser duty rule and allowing these very large punitive tariffs to be put on British industry, Bombardier in this case, exporting to the United States? I think he is agreeing that he likes the US approach.
Bill Esterson
That is not what I was suggesting. I am saying that we have to recognise that countries such as the US, as demonstrated by this case, are prepared to act. We have to be realistic about that. We have to make sure that we have the right representation on the TRA so that we are making the right case. I do not think 300% tariffs is a good idea at all, but we certainly need to be able to make the right judgments when such things apply. There is a balance between protectionism and the approach in the Bombardier case.
Barry Gardiner
Does my hon. Friend agree that it would be foolish to look at one specific example of an outrageous situation, as we have had with Bombardier in the US? Thank goodness that the ITC came to the correct conclusion there. Just because it is possible to arrive at the wrong conclusion should not mean that one judges the lesser duty rule simply on that.
Bill Esterson
Of course that is right. My hon. Friend deserves credit for taking the time and effort to go and meet the ITC and to make the case with the trade unions and others from this country. The lobbying that he and others were involved in played no small part in delivering for workers and business in the UK. He deserves a lot of credit for that. I will return to my speech—
Matt Western
This reminds me of Saturday afternoons watching wrestling. [Laughter.] The crucial thing about the TRA is that it is a facilitator, not a barrier, to ensure the needs of sectors and those involved in the sectors, whether workers or businesses. That came across very clearly in the representations from witnesses last week as something they want. My hon. Friend mentioned the chairmanship. As with the Office for Budget Responsibility, it is crucial that the chair is seen as an important role and not some political lackey.
Bill Esterson
Yes, that is exactly right. The point is to get the balance between how the Conservative Government under David Cameron blocked attempts to use appropriate trade remedy measures to defend our steel industry and the excessive use of them by the Americans. That is what the new TRA should do and that is why it needs to have the right balance of membership.
The message from the evidence given by the witnesses last week was loud and clear: stakeholders want representation on the TRA. They want their voices to be heard and their concerns taken into account, and they want that guaranteed in statute, not through ad hoc discussions with the Government. George Peretz QC told us that the composition of the TRA
“ought to be balanced by statute and that it ought to reflect a variety of different perspectives.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 55, Q105.]
We also heard from James Ashton-Bell of the CBI, that:
“In anything where you are making choices about trade and how it will impact the wider economy, you should have a wide and balanced group of people advising Government, or an independent authority, about how to make those choices.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 25, Q54.]
Chris Southworth of the International Chamber of Commerce concurred, saying that
“the representation is a critical point. An independent body, yes, but there must be representation within that independent body to represent all the important voices”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 25, Q54.]
That responds to the question by my hon. Friend the Member for Warwick and Leamington.
If the Minister will not listen to me, will he at least listen to business associations, industry representatives, trade unions, academics, QCs and civil society? They are all coming out against how he and his Department are going about this. I urge Members on all sides to support our three amendments, but if the inevitable happens and the Minister leads them into voting us down, I look forward to him bringing forward his alternatives later in proceedings.
Hannah Bardell
It is a pleasure to serve under your chairmanship once again, Mr Davies. It has been a fascinating debate. I want to say at the outset that we absolutely support our colleagues in the Labour party in their amendments, but have also tabled amendments 39, 38, 40 and 41, which I will speak to.
The legislation needs to be strengthened. Amnesty’s response was interesting. It said that an independent body with appropriate expertise should be established with a remit to conduct or commission assessment impacts of future free trade agreements on human rights, equality and the environment in the UK and of trading partners. This could be the proposed Trade Remedies Authority if it were given the resources, remit and powers.
On powers, it is important to remember that we are 20 years on from devolution. Devolution delivered huge changes across the nations of the UK. I can understand that many in England perhaps feel somewhat left behind, because we have moved on in Scotland, Wales and Northern Ireland. I have some sympathy with that but the point of the amendments is respecting devolution, and recognising the nations of the UK and the relationship that they have developed directly with the EU, and the importance of trade.
The Scottish Parliament was established to be accountable and answerable to the people of Scotland, to be open and encourage participation, to be accessible and to involve all the people of Scotland in its decisions as much as possible, and to have power sharing. That is an important point: power should be shared among the Scottish Government, the Scottish Parliament and the people of Scotland.
On the decisions about where the Trade Remedies Authority is physically located and about whether it will have non-exec members, decisions about the businesses and the people of each of the nations of the UK are best made as close to those people as possible. We understand that the functions of the Trade Remedies Authority will be reserved and it will undertake trade remedies investigations across the UK, but it is important that Scottish, Welsh and Northern Ireland Ministers have a role in the Trade Remedies Authority.
Amendment 39 requires the Secretary of State to secure the consent of each of the devolved nations before appointing a chair to the Trade Remedies Authority. We feel it is only fair that we have a say in that matter. It is common practice for interview panels to be made up of people from a range of disciplines. The hon. Member for Hertford and Stortford said that there will be a range of people, but I am sure he will have sympathy with my view that, although the west midlands is a very important part of the UK, it is not a country in the way that Scotland is. Since 2007, Scottish exports to the EU have grown by more than 25%. The EU market is eight times larger than the UK’s alone. Scotland exported £12.3 billion-worth of exports to the EU in 2015, and that figure is growing, so the EU is a hugely important market for us. It stands to reason that Wales and Northern Ireland must have a fair and proper say in who is appointed.
Mr Prisk
On a point of order, Mr Davies. I have been listening to the hon. Member for Sefton Central and the hon. Member for Livingston, and it is clear that these are broad subjects. Will you confirm that it is not your intention to have an additional debate on schedule 4, and that given the scope of what is being discussed—not just the amendments but wider issues—this is in effect a stand part debate on schedule 4?
The Chair
That decision is at my discretion. It may actually end up being at the discretion of one of my fellow Chairs, and I do not want to commit them to anything, but I certainly hear what the hon. Gentleman says.
Hannah Bardell
I feel that it is important to make these broader points, because they are germane to the issue and to the amendments.
For us, the bottom line is ensuring that the devolved nations and the devolution settlements that were agreed on a cross-party basis are respected. That is absolutely at the heart of these amendments. I hope that we are able to get support for them, cross-party—and certainly from our Labour colleagues.
Greg Hands
May I start by correcting an inadvertent error I made earlier? I mentioned an agreement that was signed by the Secretary of State for International Trade with South Africa and SADC in August or September. It was actually earlier than that. It was signed in July by Lord Price. I know that the hon. Member for Brent North takes an interest in South Africa, so I will quote briefly from what was said:
“The Southern African Customs Union…has welcomed the UK’s intention to prevent disruption of trade relations with other countries as it leaves the European Union”.
I think that clears up where we are with South Africa.
Let me start by stressing that the Government recognise the important role that Parliament, industry stakeholders and the devolved Administrations play in building the UK’s future independent trade policy. We look forward to working with all those groups and organisations on the establishment and operation of the Trade Remedies Authority to ensure that their views and interests are taken into account where appropriate. However, these amendments are not appropriate to the creation of that new function.
Decisions on trade remedies cases can have profound effects on markets, so we need to create an independent and objective investigation process in which businesses and consumers have full confidence. That is why we are setting up the Trade Remedies Authority as an arm’s length body with the appropriate degree of separation from the Department for International Trade. The hon. Member for Sefton Central said that trade remedies are inevitably political. That is precisely why we are ensuring that investigation and evidence-gathering must be done independently.
Faisal Rashid
James Ashton-Bell of the CBI told us that the fundamental question it has about the Trade Remedies Authority is
“who makes the ultimate decisions about when to take action and when not to take action.”––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 24, Q52.]
Given the lack of clarity about that, does the Minister agree that it is vital that appointment to and operation of the Trade Remedies Authority is as transparent as possible?
Greg Hands
Yes, and the authority is very transparent in its operation. A lot of how the authority operates is outlined in the Taxation (Cross-border Trade) Bill, which is being debated down the corridor. I strongly feel that there is really good transparency in the arrangements we have made regarding the authority’s independence, arm’s length nature and specialist and independent evidence-gathering. We are also ensuring that it is accountable to the Government and that, at the end of the day, a political decision is still taken about whether to impose trade remedies.
Barry Gardiner
I think we would all welcome a sense that this body was independent, so can it be right that one person with a particular view of trade should be empowered under the Bill to appoint every single member of the TRA, including the chair? Depending on the order in which they make the appointments, that is entirely possible under the Bill.
Barry Gardiner
The Minister is shaking his head, but under the Bill, so long as the Secretary of State appoints the chair last—there is nothing to prevent him doing that—he is empowered, absolutely on his own, to put his friends, cronies and the people who have his view of trade in every single position. He would then appoint the chair. If he appoints the chair first, he has to do the rest in conjunction with others.
Greg Hands
Let me be of assistance to the hon. Gentleman. It is quite clearly laid out in the appointments procedure that the Secretary of State appoints the chair, and the other non-executives in consultation with the chair. In exceptional circumstances, the Secretary of State can appoint the chief executive, but only if the chair has not yet been appointed. That is laid out in the legislation. The executive members are not appointed by the Secretary of State. It is important to understand that the Secretary of State does not appoint the whole body.
On top of that, the appointments process of course follows good governance principles and rules on public appointments. For the benefit of the Committee, I will outline those rules. First, the Government are responsible for setting out the processes and principles that underpin the management of public bodies. Secondly, there are explicit rules on the roles of Ministers and Departments in the public appointments process. The rules outline the role of the Commissioner for Public Appointments, who is the independent regulator of public appointments. I am sure they would take more than a casual interest in the TRA, were the case that the hon. Member for Brent North outlined to transpire.
The rules also include the governance code for public appointments. We have worked with governance experts in the Cabinet Office and HM Treasury to ensure that the TRA complies with those governance rules and others. The rules include guidance on managing public money and all the usual protections we would expect to see in an appointments process.
Barry Gardiner
Will the Minister, in the light of his remarks, comment on schedule 4(2)(1)? It states:
“The TRA is to consist of…a Chair appointed by the Secretary of State…other non-executive members appointed by the Secretary of State…a chief executive appointed by the Chair with the approval of the Secretary of State or, if the first Chair has not been appointed, by the Secretary of State, and…other executive members appointed by the Chair.”
In other words, the majority of the Committee—all the non-executive members, the chair and the chief executive—can be appointed by one individual: the Secretary of State.
Greg Hands
I refer the hon. Gentleman to later in the schedule. If he would care to turn over the page, it states:
“The Secretary of State must consult the Chair before appointing the other non-executive members.”
He is being highly selective in choosing elements of the Bill that appear to suit his argument.
Most importantly, these are public appointments, so we will of course have a standard competitive process following good governance principles and rules on public appointments. The successful candidates will be selected based on whether they have the right skills and experience to deliver this new UK-wide function effectively. The arrangements are broadly consistent with those of equivalent arm’s length bodies.
On the role of Parliament and amendments 21 and 22, it is important to ensure that the TRA’s senior leadership, and particularly its chairman, are in place as early as possible to enable the TRA to be operational by the time the UK leaves the EU. That will ensure continuity for UK industry. Giving the International Trade Committee a role in the appointment of members to the TRA, including its chair, would add additional stages to the appointment of non-executive members, thereby delaying the process. More significantly, referring back to the point made by my hon. Friend the Member for Hertford and Stortford, it would risk politicising the appointment process, thereby undermining the TRA’s status as an independent and impartial body.
Alan Brown
To be clear, people appointed on merit by the UK Government will be completely impartial, but people appointed by devolved Governments will suddenly have such conflicts of interest that it will pull the whole TRA system down a hole?
Greg Hands
I appreciate the hon. Gentleman’s point, but the point is to have a UK-wide perspective, and for the appointments to be based on expertise in that space, and made following good governance principles. That is the objective for the membership of the TRA.
On trade remedies, I think the hon. Member for Sefton Central impugned my hon. Friend the Member for Corby by saying that he was not sufficiently interested in the steel industry. I have known my hon. Friend for some time, and he is incredibly passionate about the steel industry. He takes a keen interest in the operations of the TRA, and is quite expert in this space. He knows that much of the detail of the operation of the TRA is not in this Bill but in the Taxation (Cross-border Trade) Bill.
Bill Esterson
The Minister really should not make such accusations; he knows that is not what I said or what I meant. I am well aware that the hon. Member for Corby takes a keen interest in the subject, along with all Members representing constituencies across the country with a steel industry presence; they work together extremely hard, cross-party, to try to support the steel industry. It was a completely inaccurate accusation, and I hope the Minister will withdraw it. My criticism was entirely of the Government and their failure in the European Union to support the measures that were needed.
Greg Hands
I think we are in one of those cycles; I am alleged to have impugned the hon. Gentleman by saying that he impugned my hon. Friend the Member for Corby. I will just leave it on the record that my hon. Friend is a doughty defender of the steel industry in the House, and through his influence with the Government.
I think the hon. Member for Sefton Central suggested that the Secretary of State should not appoint members at all. We need the Secretary of State to appoint the non-executive members in order to ensure that they are directly accountable to an elected representative with responsibility for the whole UK, because ultimately trade remedy measures will be taken across the UK. That person is quite properly the Secretary of State, who is accountable to Parliament. That is broadly in line with what happens in other arm’s length bodies.
The hon. Gentleman also talked about putting in place the right framework for the TRA. We are clear that we will operate a robust trade remedies regime to protect UK industry from injury caused by unfair trading practices and unforeseen surges in imports. I said of the TRA at the very beginning that free trade does not mean trade without rules. Rules are incredibly important, and making sure we have a strong defensive capability is a key part of that. That is why there will be a presumption in favour of measures in all dumping and subsidies investigations—that is in the Taxation (Cross-border Trade) Bill.
It is right that there is a mechanism for identifying whether measures are likely to have a disproportionate impact on other economic actors in the UK, such as downstream industries and consumers, and whether they might have a regional impact or an impact in one of the nations of the United Kingdom. The economic interest test ensures that the trade remedy system takes into account wider economic considerations in addition to the interests of UK producer industries. It is a chance to step back and consider whether measures would be in the best economic interests of the UK and will ensure that measures are not imposed where that is not the case.
Points were raised about different balances within the board. We have to come back to the overriding factor that should prevail to ensure that we comply with good governance principles: appointments are made following an open, competitive process on the basis of merit and on the basis of being able to discharge the function of looking at the whole question of a particular issue that might be prompting a trade remedy on a UK-wide basis. That is why it is important that we have built appropriate processes into the framework set out in the Taxation (Cross-border Trade) Bill to ensure that impacts on Scotland, Wales and Northern Ireland are given due consideration.
Barry Gardiner
The Minister is being extremely generous in giving way. Before he finishes his peroration, would he agree with me that there is a sensible distinction to be made between the executive members and the non-executive members of the TRA? Executive members are expected to be specialists. They are expected to have specialist trade knowledge or specialist knowledge that could determine whether dumping has taken place and so on. The non-executive members have more of a representative function. In that context, would he not see that that distinction in the amendments and others we support has some purchase?
Greg Hands
I thank the hon. Gentleman for that intervention because it allows me to say that I do not agree. The non-executive members are not intended to be representatives of particular interests or particular parts of the United Kingdom, or particular sectors or producers or consumers or trade unions. The idea is that all members of the board have the ability to think right across the question of what is happening in terms of the injury that has been created or reported to have been created. What is the best way of assessing all the evidence? What is the best way of doing, for example, the economic interest test? I entirely disagree with him. These people are not representatives. They are able to take a dispassionate, evidence-based and informed decision, looking at all of the available evidence.
The TRA will consider the wider impact of trade remedy measures as part of the economic interest test. As part of that process, the TRA will consider the impact of measures on different groups across the UK, including any regional or distributional consideration. It is important to understand that its members do not have to be, and in fact should not be, representatives of those regional distributional considerations or producer or consumer and so on. They are designed to look at the evidence and come to a recommendation based on the overall evidence in front of them. It will also consider the likely impact on affected industries and consumers. We would expect the TRA to gather information where relevant to inform the economic interest test. For those reasons, I ask the hon. Gentleman to withdraw the amendment.
Bill Esterson
I will not be withdrawing the amendment. The Minister talks about good governance. Non-executives often, on many boards, in many situations, come from membership organisations. They then use their judgment on a wide range of issues, but they come from those membership organisations. I am afraid he is wrong about that. He speaks of the risk of political appointments. There is one way to ensure that this is a politicised series of appointments: to leave everything in the hands of the Secretary of State. That is for sure. If the appointment process is so watertight, why is there a whole section in the Bill dedicated to what happens if the chief executive is appointed by the Secretary of State? It is being anticipated as, I guess, a quite likely scenario.
The Minister talked about accountability to Parliament, but there is none under the Bill. There are a number of examples of parliamentary scrutiny of appointments. Select Committees play a significant role in a number of appointments to public office. The Treasury Committee gives its consent to the appointment and dismissal of members of the Budget Responsibility Committee. The Digital, Culture, Media and Sport Committee has the power of veto over the appointment of an Information Commissioner, and there are a number of examples of pre-appointment hearings for significant public appointments.
When something is so crucial to our economic and international trade future, why do the Government not care to involve the Select Committee in the appointments? If they will not support the amendments, I look forward to them coming forward and dealing with the point that the Minister made in his summing up about how he expects accountability to be delivered to Parliament. I will put our three amendments to the vote.
Question put, That the amendment be made.
Trade Bill (Seventh sitting)
Tuesday 30th January 2018
(6 years, 10 months ago)
Public Bill CommitteesRead Full debate Trade Bill 2017-19 View all Trade Bill 2017-19 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 30 January 2018 - (30 Jan 2018)
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Chair
I call Hannah Bardell, who is not in her place—[Interruption]—unless she is!
Schedule 4
The Trade Remedies Authority
Hannah Bardell (Livingston) (SNP)
I beg to move amendment 42, page 18, line 39, at end insert
“and to each devolved authority”.
This amendment would require the TRA to send its annual report to each devolved authority.
The Chair
With this it will be convenient to discuss the following:
Amendment 43, page 18, line 40, after “Parliament” insert
“and shall supply copies to—
(a) the Scottish Parliament,
(b) the Welsh Assembly, and
(c) the Northern Ireland Assembly.”
This amendment would require the Secretary of State to supply copies of the annual report to the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly.
Amendment 24, page 18, line 40, at end insert
“no later than 1 August of the calendar year in which the last day of the financial year covered by the report falls”.
This would ensure that the Secretary of State must lay the annual report of the Trade Remedies Authority before Parliament within a reasonable time frame.
Amendment 25, page 18, line 40, at end insert—
“Recommendation reports
31A (1) The TRA must prepare a report on each of the individual recommendations it makes to the Secretary of State in connection with the conduct of an international trade dispute.
(2) The report must accompany the recommendation submitted to the Secretary of State.
(3) The Secretary of State must lay the report before Parliament as soon as reasonably practicable, and not later than five days from the time it is submitted to the Secretary of State by the TRA.”
This would ensures that Parliament is kept informed, in a timely fashion, of the individual recommendations made by the Trade Remedies Authority to the Secretary of State in connection with cases of dumping, foreign subsidies and import increases causing injury to UK producers.
Hannah Bardell
I apologise for my lateness, Ms Ryan. I will be brief, because I know that time is of the essence. Amendments 42 and 43 are fairly straightforward, and seem to me to be a sensible and rational approach. Amendment 42 would require the Trade Remedies Authority to send an annual report to each of the devolved authorities; it is vital that we have those reports. Similarly, amendment 43 would require the Secretary of State to supply copies of the annual report to the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly. In doing so, I hope that Ministers will also consider appearing, as they already do, before their Committees, particularly in relation to trade remedies. I cannot imagine why there would be opposition to that; it seems like an entirely sensible approach. I hope that the amendments will command support across the Committee.
Bill Esterson (Sefton Central) (Lab)
I will speak to amendments 24 and 25, which stand in my name and those of my hon. Friends. As the explanatory statement makes clear, the amendments would ensure that our Parliament is kept informed in a timely fashion about the work of the Trade Remedies Authority.
Parliament should be able to scrutinise the work of the TRA to ensure that it is working in the best interests of the UK economy and UK producers. Such requirements are nothing new in the realm of trade remedies. At European Union level, the Commission is obliged to report to the European Parliament and to give MEPs statistics on the cases opened and the number of measures adopted. Members of this Parliament should be given the same information from our TRA once it is up and running, so that they can scrutinise its work. MPs should be able to see how many cases have been initiated and measures adopted and so judge whether the TRA is taking measures to defend our industries or mostly putting consumer interests first at the expense of British producers, jobs and the regions.
Tom Reynolds of the British Ceramic Confederation pointed out that he would be more comfortable if there were a more rigorous approach for parliamentarians to get involved in the setting of the rules for the system. Just as in the rest of the Bill, the Government propose nothing in the schedule about parliamentary oversight or scrutiny of the TRA. Yet again, they want to make decisions that will have profound impacts on key sectors of British industry, thousands of jobs and many regions, behind closed doors and without any scrutiny or accountability to Parliament. The Minister and his colleagues might talk the talk on returning sovereignty to this Parliament, but when it comes to it, they once again fail to respect the very principles of parliamentary democracy.
Giving parliamentarians oversight powers over the work of the TRA will ensure proper scrutiny and accountability. A weak trade remedies regime is of benefit to nobody in our country. If anybody thinks that having a weak regime will open up trade opportunities with international partners, they are mistaken. Partner countries will take advantage of that, and we will once again see the loss of jobs, as we did in the steel sector in 2015 and 2016. It is only right that this House gets to scrutinise the work of the TRA to make sure that it is doing its job properly.
The Minister for Trade Policy (Greg Hands)
Welcome back to the Chair, Ms Ryan. May I start by congratulating the hon. Member for Livingston on redefining the term “moving an amendment”? She was actually in motion as she did it, so I commend her on her dexterity.
It is important that we create an independent and objective investigation process in which businesses and consumers will have full confidence, as I referred to previously. For this reason we are setting up the TRA as an arm’s length body with the appropriate degree of separation from the Department for International Trade. The Trade Bill requires the TRA to produce an annual report on the performance of its functions during each financial year. That must then be sent to the Secretary of State, who must lay the report before Parliament.
Let me deal with the four amendments. Amendments 42 and 43 are concerned with the sharing of the reports, requiring the TRA to submit annual reports on the performance of its functions to each devolved Administration, in addition to sharing copies with the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly. Much as I strongly endorse our consulting with and involving devolved Administrations at all stages of this process, and expect the TRA to pay due heed to the devolved Administrations and to involve them as well, I must tell the hon. Lady that the amendments are unnecessary. The Bill already requires the Secretary of State to lay a copy of the TRA’s annual report before the UK Parliament, and at that point it will be a publicly available document for all to see right across the United Kingdom, including in Scotland, Wales and Northern Ireland.
Amendment 24 is on the annual report itself. The Bill already requires the annual report to be produced
“as soon as reasonably practicable after the end of the financial year to which it relates.”
The amendment, which seeks to impose an arbitrary fixed deadline for when the TRA is required to produce the report, is therefore also unnecessary. We are balancing giving the TRA a statutory requirement to produce the report on time, while recognising the importance of safeguarding operational flexibility, which is particularly important for a new organisation.
Amendment 25, on the investigation report, is interesting. I have referred a few times to the Taxation (Cross-border Trade) Bill, which is in Committee in another room. As laid out in that Bill, the TRA will be responsible for making recommendations on trade remedies cases to the Secretary of State. However, the amendment could lead to recommendations made by the TRA being released publicly before the Secretary of State has reached a final decision. Indeed, it is unlikely that the Secretary of State would make the decision in five days given the potential need to consult across Government. In my view, this could undermine the impartiality of trade remedies recommendations by increasing lobbying of Ministers by any parties affected by the TRA’s recommendations, be they producers, consumers or other stakeholders.
Faisal Rashid (Warrington South) (Lab)
Does the right hon. Gentleman agree that the amendment seeks a role for MPs that is akin to the role that MEPs have with regard to trade remedies?
Greg Hands
I thank the hon. Gentleman for that intervention. It is right that MPs have a role and that the TRA reports to Parliament. That is why the TRA publishes the annual report and is answerable to the Secretary of State, who is answerable to Parliament. Publishing the TRA’s recommendations before the Secretary of State has made the decision based on them is not a good idea, for reasons I will outline.
Barry Gardiner (Brent North) (Lab)
Does that explain why the Government were so backward in making representations to the US International Trade Commission with respect to Bombardier? The Minister said that it would be inappropriate to lobby such an organisation. Is it the Government’s position that it is inappropriate for lobbying to take place when a trade remedies authority is considering whether dumping has taken place or what remedies might be appropriate? Is that his approach to defending British industry when it faces trade defence measures abroad?
Greg Hands
The hon. Gentleman is confusing different processes. The British Government made extensive representations to the parties and the ITC during the investigation process in the United States. That is the key difference. Of course people will be expected to make representations during the investigation process in the UK, but my point was about publication of the TRA’s recommendations between the investigation process and the Secretary of State’s pronouncement.
In any case, I dispute the hon. Gentleman’s point. The UK Government have put in enormous efforts: my boss, the Secretary of State for International Trade, spoke at length with Wilbur Ross, and the Business Secretary also made representations. Very extensive and successful representations were made to US authorities, to Boeing and other companies, and to the US Administration.
Amendment 25 could lead to unnecessary disruption of the market in the key period between the TRA’s recommendations and the Secretary of State’s decision.
Greg Hands
Let me make a little more progress.
Amendment 25 could delay the Secretary of State’s decision. The evidence base for the TRA’s recommendations should be made available to the public after, not before, the Secretary of State accepts or rejects them, as required by World Trade Organisation agreement. That is the right time for the evidence base to be put in the public domain.
Barry Gardiner
It is only the one he deferred a few moments ago. I am grateful to the Minister, because he has engaged in debate and the Committee has been the better for it. However, he mentions the appropriate point for intervention. The American situation involved two decisions: the US Department of Commerce made an initial determination and then the US International Trade Commission had to look at whether any damage had been caused and recommend any appropriate charges. The situation was somewhat akin to a recommendation being made to the Secretary of State and the Secretary of State deciding what to do about it. There is a real parallel here that the Minister is denying. As I am sure he acknowledges, amendment 24 would not set an arbitrary deadline; it would ensure that the Secretary of State laid the report before Parliament in a timely fashion.
Greg Hands
May I end—again—by saying that I do not think it is right to make an exact comparison between the UK and US situations? As I said earlier, the design of the Trade Remedies Authority in the UK has been informed by international best practice, but it is fundamentally a different system. The right time for representations to be heard from businesses, consumers, MPs and other stakeholders is while evidence is being gathered, not between the TRA recommendation and the Secretary of State’s determination. On that basis, I ask the hon. Member for Livingston to withdraw amendment 42.
Question put, That the amendment be made.
Bill Esterson
I beg to move amendment 26, in clause 7, page 4, line 32, leave out subsection (1) and insert—
“(1) The Commissioners of Her Majesty’s Revenue and Customs may, by regulations, request any person to provide, or make provision authorising officers of Her Majesty’s Revenue and Customs to disclose, prescribed information for the purposes of assisting the Secretary of State to establish the number and identity of persons exporting goods and services from the United Kingdom”.
This would ensure that, where HMRC already has this information, it may be shared with the Secretary of State.
The Chair
With this, it will be convenient to discuss the following:
Amendment 27, in clause 7, page 4, line 38, at end insert—
“(2A) For the purposes of subsection (1) “prescribed information” means the names and addresses of persons who have exported goods covered by a prescribed code.”
This would ensure that the information to be collected pertains only to exports recognised as such for official purposes, in line with the Small Business Enterprise and Employment Act 2015.
Amendment 28, in clause 7, page 4, line 38, at end insert—
“(2A) For the purposes of subsection (2A) “prescribed code” means the commodity code or other identifier applied to a category of goods or services in connection with the preparation of statistics on exports from the United Kingdom (whether or not it is also applied for other purposes).”
This further qualifies what “prescribed information” means.
Amendment 29, in clause 7, page 5, line 3, at end insert—
“(3A) Regulations under subsection (1) may not make provision that could be made by regulations under section 10 of the Small Business Enterprise and Employment Act 2015.”
This would avoid duplication, in respect of the collection of information from exporters, with the Small Business Enterprise and Employment Act 2015.
Amendment 32, in clause 8, page 5, line 17, leave out from “trade” to end of line 19.
This would remove the power granted by the Bill to Her Majesty’s Revenue and Customs, or anyone acting on their behalf, to disclose information on United Kingdom exporters to any public and private body within or without the United Kingdom.
Bill Esterson
We recognise that it is essential to the efficient performance of the Department for International Trade and to the future delivery of trade policy that the Government have access to appropriate information about our imports and exports. We are also very aware of the impact on businesses, particularly small and medium-sized enterprises, of any increased burden in administration and mandatory reporting.
Clause 7 seeks to ensure that the Secretary of State may have access to such information, as collected by Her Majesty’s Revenue and Customs, that would establish the number and identity of exporters. What exactly the information is that will be required is not disclosed and the clause does not limit HMRC in terms of what information may be sought, only setting out that the information may be used for
“the purpose of assisting the Secretary of State”
in his endeavour. HMRC could, in theory, use the power to request significant volumes of information that might be subsequently determined not to be needed for the purpose of assisting the Secretary of State, but that none the less requires disclosure under this provision.
This is not a trivial matter. Businesses and business organisations have expressed their concern about the provision, because much of this information is already collected by HMRC and businesses do not want to have to provide it more than once, because of the time that that would require and the impact it would have on their day-to-day operation.
That prompts the question of why powers must be awarded that would replicate that which is already being done. If existing legislation does not provide for the Secretary of State to access this data, one may very well understand the need to stipulate that such information may be shared with his Department. However, if such information exists already, the burden should not be put on businesses to furnish the same information in a different format, simply because of a failure to collate the information that is already in the possession of Government Departments or agencies.
That is why we tabled amendment 26, which would allow the Commissioners for Revenue and Customs to authorise their officers to disclose such information to the Secretary of State for the purposes described in the Bill, and amendment 29, which would prevent the potential creation of duplicate or conflicting regulations.
Amendment 29 recognises that section 10 of the Small Business, Enterprise and Employment Act 2015 contains provisions on the disclosure of exporter information by HMRC. SMEs are, after all, the backbone of our economy and we should encourage them to increase exports and not bog them down with tax forms and administration that may put some businesses off exporting.
Currently, much of the information is contained in the various documents and forms that must already be furnished to HMRC. For example, there is mandatory Intrastat reporting, which requires goods exporters to submit on a monthly basis details of goods and exports within the European Union, subject to minimum annual thresholds. Of course, that measure is enforceable by the European Union, but perhaps the Minister will confirm whether it will continue to be enforceable under the terms of the European Union (Withdrawal) Bill. I imagine a note will wing its way to him about that shortly. [Interruption.] He already knows—impressive. There is always a first time.
Similarly, VAT-registered exporters are required to supply HMRC with EC sales lists that detail their EU customers, the respective country codes and the value of goods supplied to them. On top of that, customs declarations must be made that record product codes, transport modes, duties levied and other relevant information for the purposes of accumulating information on the number and identity of exporters.
The much-trumpeted new customs declaration service will allegedly be operating by March 2019. Will the Government be incorporating this reporting requirement into it, or will additional systems be needed? In other words, how does the Minister intend to avoid duplication? HMRC has already acknowledged that there is a risk that the new customs declaration service is unlikely to be in place by exit day, so it will be phased in, which will result in limited functionality and scope when launched. That prompts the question about whether the new customs declaration service will be geared up in time for the reporting requirements of the Bill. Will the Government consider additional resources for HMRC to carry out additional duties for all these additional reporting requirements?
Our amendments recognise that where such information may not otherwise be available, regulations may be passed to require other persons to disclose it. However, the Government must clarify whom the Commissioners for Revenue and Customs may so instruct. The provision is extremely vague and potentially awards sweeping powers to HMRC to request information from persons entirely unconnected to an exporter or indeed trusted agents and advisers who might otherwise be bound by a duty of confidentiality.
Clearly, as some of our witnesses suggested, many existing reporting obligations are applicable to the export of goods rather than services. That gap needs to be addressed. Unlike goods exports, which have commodity codes for export purposes, there are not the same proper definitions and appropriate attributable codes for services, which means that it is difficult to determine when a service becomes an export. If the Minister does not have the full detail on that, I will not be entirely surprised, but perhaps it is something for his officials to persist with. The service exports to which these provisions will apply must be qualified, particularly as the definition of what constitutes a service may be vague. Many businesses have significant group operations and may provide services between subsidiaries, which would be treated as intra-group charges. Do the Government intend to inflate service export figures by including those details?
Amendments 27 and 28 are designed to prevent services that should not or would not be considered to be exports from being considered such by requiring that only exports with appropriate codes and identifiers can be considered for those purposes; that includes new codes where needed. However, we also recognise and welcome efforts by HMRC to tackle abusive transfer pricing and aggressive tax planning. Can the Minister tell us whether HMRC will use that information for such purposes in addition?
Greg Hands
I thank the hon. Gentleman for his set of questions, which I will answer as far as I can. Let me start with why we need the data collection and sharing powers.
It is important that the Government have a more comprehensive understanding of UK exporters. The powers will allow the Trade Remedies Authority to fulfil its function by using full and proper data on the UK business population. They will also equip my Department with robust data to develop trade plans globally, and help us better to understand the impact of future trade agreements and policies so that we can direct our resources appropriately. Ultimately, that will provide better value for money for the taxpayer by enabling more targeted approaches to Government intervention and support for existing and potential exporters.
Clause 8 sets out the powers necessary for HMRC to share the data with the Department for International Trade and other Departments and organisations, for those bodies to carry out their public functions related to trade. I will come to the points raised by the hon. Gentleman in a moment, but those powers need to be wide enough to be able to withstand future institutional developments, so the clause will also allow HMRC to share the data with, for example: other bodies that DIT sets up to cover specific functions, such as the Trade Remedies Authority; bodies that carry out a public trade function, to ensure that the UK is able to put in place and maintain an independent trade policy as we leave the EU; and bodies outside the United Kingdom, such as the World Trade Organisation, with which the UK will be obligated to share data as part of our international obligations. That is currently done through the European Union; there is no change to the effect of that provision.
Amendment 32 would restrict the Government’s ability to take on functions related to trade formerly carried out by the European Commission, such as those related to trade remedies. You will know, Ms Ryan, that the European Commission currently does trade remedies investigations, a lot of which are data-driven. The amendment would hinder our ability to take such a data-driven approach ourselves.
Amendment 26 duplicates in clause 7 the necessary data sharing powers already set out in clause 8. Looking ahead to this country leaving the European Union, the amendment’s requirement to seek HMRC commissioner approval before any data is shared would also restrict the Government’s ability to share data at speed. It may be necessary, for example, to share data with the Trade Remedies Authority quickly or immediately when dealing with a trade defence case. I would not want the Trade Remedies Authority to be prevented from taking urgent action—sharing data about an important trade remedy quickly and efficiently, for example—in relation to a sector such as steel or ceramics because the Opposition had imposed an artificial delaying power with their requirement to seek HMRC commissioner approval before any data is shared.
Faisal Rashid
I understand what the Minister says about speed and things that have to be done, but many businesses, particularly small businesses, often struggle to stay on top of their reporting and administration requirements. There is a risk that any increased burden on them could put them off exporting. How do the Government intend to collect this information while ensuring that they do not place an unfair burden on small businesses?
Greg Hands
First, in the long run, small businesses will benefit from the Government being informed by a full set of data on the exporter community. It is difficult for the Government to set policy in relation to exporters without having a full picture of how many exporters there are and in which sectors. In the medium to long run, our ability to collect that data would help small businesses considerably. Secondly, the provision of that data will of course be voluntary. If a small business did not want to participate, for whatever reason, it would not be compelled to do so. It is very important to recognise that.
Anna McMorrin
What does the Minister intend to do with the information that is collected? Also, what international bodies do the Government believe that information—much of which may be commercially sensitive —should be shared with, and why should they require such data?
Greg Hands
On the international bodies, I refer the hon. Lady particularly to the WTO, with which we are actually obliged to share a lot of that data. Much of that data sharing is currently done through the EU, but once we are outside the EU we will be obliged to share that data with the WTO on a stand-alone basis. Domestically, sharing a lot of the data with the Trade Remedies Authority will enable it to be well informed as it looks at the impact of alleged dumping on UK domestic industry, which is, after all, the purpose of the TRA.
I will take an intervention from the hon. Member for Warwick and Leamington. [Interruption.] Oh, he had the same intervention.
Greg Hands
It is good to see people thinking similarly. Sharing data quickly and immediately may be necessary for, as I say, the TRA dealing with a trade defence case, or where data is immediately required in a fast-moving future trade agreement negotiation.
Clause 7 sets out the powers needed for the Government to collect data to establish the number and identity of UK businesses exporting goods and services. Amendments 26, 27 and 28 would narrow the ability of the Government, both now and in the future, to determine what data we wish to collect and how we may collect it. The Government should retain the ability to determine in the future what relevant trade information they may need to request from businesses, although I stress that providing that information is voluntary. At this time, we are not able to anticipate precisely what those needs will be.
On some of the individual points, I think the hon. Member for Sefton Central claimed that HMRC is unrestricted in what data it can source. I stress that the power in the Bill is to request information. The Treasury will specify what information will be requested, and will do so by regulations that will come before Parliament. There is no obligation on businesses to provide that information, although we say, and strongly believe, that it is in their interests to do so, to help to inform the Government’s export policy.
On additional resources at HMRC, I rather feel that that might be a debate for another day in another place. However, the resources given to HMRC post Brexit to deal with Brexit are already there. Various announcements have been made by the Chancellor of the Exchequer and the Chief Secretary to the Treasury over the last 18 months on that. I point out that the power has been assessed and its likely cost looked at. It has been deemed to be relatively inexpensive and overall will not add a cost burden on HMRC.
On inflating exporter numbers, I do not think that that would be accurate. The hon. Gentleman seems to think that there is some kind of Government plot to artificially boost the number of exporters, so that we can suddenly say what a great job we have done because the number has gone up. No—the purpose of collecting the data is to have an accurate picture of the number of exporters. For example, we know there are 5.7 million private sector businesses in the UK. HMRC collects export data from 1.9 million VAT-registered businesses. There are 2.2 million VAT-registered businesses in the UK. We therefore think that the Government do not collect any export data from about 4 million UK businesses. That is what we want to do. Our analysis suggests about 300,000 businesses in the UK could and should export but do not do so. The key is to find where those businesses are and encourage them to export, so that the UK does a much better job on exports.
The hon. Gentleman asked whether Intrastat will continue. When the UK leaves the EU, Intrastat will not be applicable for exports and will not continue in this case. Finally, there were questions relating to the interaction with the Small Business, Enterprise and Employment Act 2015. Similar to my response to amendments 26 to 28, the Government should retain the ability to determine in the future what relevant trade information they may need to request from businesses. At this time, we are not able to anticipate that precisely, but I have given some indication of the sort of areas we might look at and what all those needs would be.
Amendment 29 refers to powers in section 10 of the 2015 Act. Those powers relate to disclosure of existing exporter information by HMRC officials and therefore are not directly relevant to the powers in clause 7 relating to the collection of data. In other words, it is different data. Bearing all of this in mind, I ask the hon. Members not to press their amendment.
Bill Esterson
I thank the Minister for his answers. I was puzzled by one thing. Why does the Bill not specify that the data would be for sharing with the Trade Remedies Authority if that is the primary purpose in collecting it at this point? He says there will be other organisations, but it is a bit odd that the Bill does not say as much.
Our concern—a concern that comes from business—is about giving HMRC the power to request. That is an interesting phrase. Anyone who has had any dealings with HMRC as a business tends to experience that as a fairly strong power to request. If we asked most people who run businesses, they would say it is a bit more than a power to request; they interpret it as not having any choice in the matter. That is one of our big concerns, and I hope the Minister will take that on board.
The Minister made the point that this is about the medium to long run and there will be improvements for smaller firms over that period. By implication, that leaves out the short term. I would welcome a brief intervention to confirm the implication I gathered from what he said—that there may be a hit or an increase in the demands and burdens on smaller firms while the new system is settling down. I will give way to him if that is what he thinks is going to happen.
Greg Hands
I thank the hon. Gentleman for allowing me to intervene. I do not accept that there will be an increase in the burdens for anybody involved in this process, because it is a voluntary and essentially very limited process. I would say to him that the data could be extremely helpful in informing Government policy, and that is why he should withdraw his amendment.
Bill Esterson
I am grateful for that clarification. We are keen to avoid unnecessary reporting requirements and an adverse impact, especially on smaller firms, as this country needs them to do well in trade and exports. We are supportive of the right approach and the right level of data collection in achieving such an objective. In that spirit, I will not press amendments 26 to 28. We will press amendment 29 to a vote because we still think it is important to avoid the duplication of powers in the 2015 Act. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: 29, in clause 7, page 5, line 3, at end insert—
“(3A) Regulations under subsection (1) may not make provision that could be made by regulations under section 10 of the Small Business Enterprise and Employment Act 2015.”—(Bill Esterson.)
This would avoid duplication, in respect of the collection of information from exporters, with the Small Business Enterprise and Employment Act 2015.
Question put, That the amendment be made.
Bill Esterson
I beg to move amendment 30, in clause 7, page 5, line 4, leave out subsections (4) and (5).
This would remove the Henry VIII power allowing for the modification of an Act of Parliament in respect of the collection of exporter information.
The Chair
With this it will be convenient to discuss amendment 31, in clause 7, page 5, line 10, leave out subsection (6) and insert—
“(6) Any statutory instrument containing regulations under subsection (3) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”
This would require Treasury regulations that make provision for exporters to supply information on their exports of goods or services to be subject to the affirmative resolution procedure.
Bill Esterson
The amendments would remove yet more Henry VIII powers, this time bestowed on Her Majesty’s Revenue and Customs and allowing for regulations to be made that may modify primary legislation. Using the powers, HMRC may change the nature of the information being sought under the regulations and the persons from whom such information may be requested, such that the resultant requirements on business may ultimately be substantially different from the scope implied under the clause. We are entirely opposed to the use of Henry VIII powers, as we have repeatedly said, and we do not believe it appropriate that any agent of Government has the powers to amend primary legislation by way of secondary legislation.
Amendment 31 would ensure that any regulation to which clause 7 applied must be subject to the affirmative procedure in this House, giving Parliament the proper opportunity to scrutinise any changes. There can be no good reason for allowing Henry VIII powers or the negative procedure to be used in those circumstances. I mentioned in my speech on the previous group of amendments the Small Business, Enterprise and Employment Act 2015 but it is worth drawing the Committee’s attention to section 10 of that Act, in particular subsection (6), where such regulations are subject to the affirmative procedure. Logic and consistency might suggest that that would be appropriate in this Bill too. Perhaps the Minister will explain why that was appropriate in the 2015 Act but is not in this one, despite the similar circumstances. In advance of the 2015 Act, HMRC published an explanatory memorandum on the use of the powers, noting that such information could well be sensitive and thus recognising a need to limit the scope of the information collected and subsequently shared:
“This is deliberately tightly drawn and specifies the categories of information that may be disclosed under the regulations, and is limited to less sensitive but nonetheless useful information.”
That brings us to amendment 32, which would remove HMRC’s power to share the information freely with other bodies or institutions, whether in the United Kingdom or overseas. We recognise the need to accumulate comprehensive statistics. We are mindful of the evidence from our witnesses, Professor Alan Winters of the UK Trade Policy Observatory and Anastassia Beliakova of the British Chambers of Commerce, both of whom called for the greater sharing of information. However, that is not the same as calling for the sharing of commercially sensitive information. In the light of HMRC’s explanatory memorandum to the 2015 Act, such sharing must be subject to limitations to prevent sensitive information from being shared freely.
The Chair
Order. We debated amendment 32 under the previous group of amendments and are now debating amendments 30 and 31. The hon. Gentleman needs to confine himself to comments on those amendments. I hope that is helpful.
Bill Esterson
Thank you for bringing me back on track, Ms Ryan.
I trust that the Committee recognises the impact that poor application of those powers might have on businesses. It may even result in entirely opposite outcomes to those intended. I look forward to hearing the Minister’s response to such concerns. I hope that he will address my questions about how some of the powers will be exercised and what measures will be put in place to protect our exporters.
Greg Hands
The clause sets out the powers that will enable the Government to establish for the first time ever the number and identity of UK businesses exporting goods and services. HMRC currently collects export data from approximately 70% of the 2.2 million businesses that are registered for VAT. As I said earlier, there are 5.7 million private sector businesses in the UK. That means we do not collect export data from about 4 million businesses. Our data does not include certain sectors, smaller enterprises and many exporters of services.
Why is it important that the Government have a more comprehensive understanding of UK exporters? First, the information will allow the Trade Remedies Authority to fulfil its function using full and proper data on the UK business population. Secondly, it will equip my Department with robust data to develop trade plans globally and will help us better to understand the impact of future trade agreements and policies in order to direct our resources appropriately. Ultimately, it will all provide better value for money for the taxpayer by enabling more targeted approaches to Government intervention and support for existing and potential exporters.
We are not able to anticipate all the data that we might need in future, including for those functions that I have just described to the hon. Gentleman. It is therefore vital that we retain the ability to specify the type of information to collect now and in the future to ensure that the Government are able to discharge fully all relevant trade functions.
Should amendment 30 be passed, it would not be possible to collect trade data through the tax return. We do not know whether the collection of such currently unknown data might, for example, require the modification of an Act of Parliament. I confirm to the hon. Gentleman that at such time as the Government specify what information we wish to collect and how we will collect it, we will return to this House, as is already set out in clause 7(5). I also assure him that any information collected and the way we request it will be done in such a way as to cause minimal cost to Government and business. I therefore ask him to withdraw his amendment.
Bill Esterson
I wish to press the amendment to a vote.
Question put, That the amendment be made.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I beg to move, That the clause be read a Second time.
It is a pleasure to serve under your chairmanship again, Ms Ryan. The good news at this stage is that there are fewer notes written in advance—the Committee might be quite relieved about that. New clause 3 was originally drafted by colleagues from Plaid Cymru, and my hon. Friend the hon. Member for Livingston and I were more than happy to add our names in support. Actually, we have been completely vindicated on that given how events have panned out today. There have been no concessions to any Scottish Government or Welsh Government amendments. The Government voted down the Labour amendment that would have allowed impact analysis to be undertaken and at least understood. They have excluded any provisions for devolved authorities to be involved in the Trade Remedies Authority.
The new clause is quite simple: it seeks to propose a sub-committee of the Joint Ministerial Committee, to look at effects in the devolved nations of any international trade agreement implemented by the powers in the Bill. It is simple, effective and it does not create a whole new body, because it just creates a sub-committee of the existing JMC. In terms of administration, it should not be excessive, and so I ask members of the Committee to support the new clause.
Greg Hands
I can be brief. The Government have made it clear that they seek to maintain the effects of the UK’s existing trade agreements. We make this commitment in relation to all parts of the United Kingdom, which means that we do not intend Scotland, Wales, Northern Ireland, or indeed England, to be disproportionately impacted by our transitioning of these agreements. As we have committed to seeking continuity in the effects of existing agreements, the impact of the transition should be neutral on all parts of the UK.
In relation to consultation with the devolved Administrations, as we have laid out frequently on Second Reading and in Committee, the Department for International Trade ensures that each of its Ministers, as well as directors and other senior officials, visit the devolved Administrations regularly and continually look for further opportunities to engage with a range of stakeholders across the UK.
Hannah Bardell
The Minister will forgive me if I find his comments somewhat ironic given what has been in the press over the last couple of days about impact assessments. Does it not seem reasonable that the Joint Ministerial Committee—which, as my hon. Friend says, is already in place—should have a sub-committee? He may think that as things stand there may not be an impact on the devolved nations, but I am sure that, like the rest of us, he does not have a crystal ball. Would it not make sense to put into legislation the ability for the devolved nations to have a sub-committee of the JMC to make it the best possible legislation that it can be?
Greg Hands
I accept the hon. Lady’s intervention, and she makes a case, but my point is that it is not necessary to have the review. These are existing agreements that, in a huge number of cases, are already in place. Some have been in place for a long time. The hon. Member for Kilmarnock and Loudoun says that an additional review process will be simple and effective, but I am not quite so sure. For example, the amendment makes neither reference to the intended product of such a review—how the review process would work—nor to the continued role of the devolved Administrations in the review after it has been reported.
I think it is much better that we stick with our position of consulting frequently and engaging with the devolved Administrations, without an extra review of agreements that are already in place. We have been clear that we will continue to engage with the devolved Administrations as we transition these agreements, therefore we do not need to commit this kind of review to legislation. I therefore ask the hon. Gentleman to withdraw the clause.
Barry Gardiner
It is appropriate to once again read out the long title of the Bill:
“To make provision about the implementation of international trade agreements”.
Everything that the Minister is saying ignores that the scope of the Bill precisely admits that we should be able to put into statute the procedure that the hon. Members for Livingston and for Kilmarnock and Loudoun have suggested.
The Minister has told the Committee that the Government
“will continue to engage with the devolved Administrations as we transition our current agreements”
and that:
“The Department for International Trade engages regularly with the devolved Administrations”.––[Official Report, Trade Public Bill Committee, 25 January 2018; c. 128.]
It is therefore surprising that the Government have not proposed any formal engagement procedure to ensure a statutory footing for consultation on the issues presented by the Bill—particularly given the Government’s approach to consultation thus far, which has been little more than lip service and press releases. An example of that was when the consultation for the Bill closed on 6 November and the Bill was published a few hours later on the morning of 7 November.
Modern trade agreements have extensive coverage, with chapters setting out substantial provisions in a range of areas, many of which might well be considered to touch upon matters that otherwise would be within the competence of the devolved authorities. We have gone over this ground in previous sittings, when we considered how trade agreements impact on our fishing industry, food standards, services regulation, agriculture, public services, procurement and so on. The day-to-day oversight and administration thereof may be wholly within aspects of devolved competence; however, the obligations that arise from a trade agreement might require changes to the way that those matters are managed. A question might then arise regarding when such a matter ceases to be a trade matter within the exclusive competence of the UK and becomes a matter within the competence of the respective devolved Administration.
That is why many other countries have set out formal consultation frameworks with their own constituent administrations, which may also have a degree of devolved competence. Indeed, the United States has such an engagement process to ensure that state-level representations can be fed into the negotiating process—albeit it is a process that is subject to controversy in various states that have sought to implement a much more robust consultation process, and have derailed the extension of the fast-track trade negotiating authority.
Canada has a similar process in order to ensure that, once an agreement has been concluded using the federal Government’s exclusive competence, it does not come unstuck at implementation stage. In his response to questions about the need for stakeholder engagement as early as possible in trade negotiations, our witness, Nick Ashton-Hart, noted that
“the political economy demands that you have the backing, as a negotiator, at home when you are sitting across the table from your counterparties and that they know that you have that…People know that you have to get to a sustainable deal also, and sometimes you have to do a concession at the right time to solve a problem in a domestic constituency for your counterparty”.––[Official Report, Trade Public Bill Committee, 23 January 2018; c. 10, Q12.]
The hon. Member for Kilmarnock and Loudoun touched on the concerns raised by another of our witnesses, Professor Winters of the UK Trade Policy Observatory, who noted that we cannot have a situation in which a trade agreement might be unpicked once it had been concluded. Therefore, he said,
“Parliament and the devolved Administrations need to have an important role in setting mandates, and there need to be consultation and information during the process.”—[Official Report, Trade Public Bill Committee, 23 January 2018; c. 58, Q111.]
The United Kingdom is clearly not unique in facing this matter; that is also the experience of other countries, many of which the Secretary of State is alleged to have identified as prospective gold trading partners. Those very countries may well wish to see a similar framework formally constituted in the UK before we come to the negotiating table. The European Union levelled that request at Canada prior to commencing negotiations on the comprehensive economic and trade agreement. The JMC appears to be an entirely appropriate forum for such consultation in the UK’s case. It would provide us with an off-the-shelf committee with the express purpose of seeking to avoid such complications.
The memorandum of understanding between the UK and the devolved Administrations notes that the four respective Administrations agreed
“to alert each other as soon as practicable to relevant developments within their areas of responsibility, wherever possible, prior to publication”—
of course, the GPA, which the Minister did not refer to, is one such case that is quite specifically about implementation within the devolved Administrations’ competence—
“to give appropriate consideration to the views of the other administrations; and…to establish where appropriate arrangements that allow for policies for which responsibility is shared to be drawn up and developed jointly between the administrations.”
Furthermore, in recognition that a commitment to engage may not be sufficient in certain cases, the memorandum of understanding sets out provisions for a formal consultation framework to ensure that engagement on such matters is more than just lip service.
Acknowledging that there will, of course, be matters relating to international issues that will touch on devolved matters, the memorandum of understanding requires the fullest possible engagement on such matters and sets out the framework for the Joint Ministerial Committee. Its terms of reference are
“to consider non-devolved matters which impinge on devolved responsibilities, and devolved matters which impinge on non-devolved responsibilities…where the UK Government and the devolved administrations so agree, to consider devolved matters if it is beneficial to discuss their respective treatment in the different parts of the United Kingdom…to keep the arrangements for liaison between the UK Government and the devolved administrations under review; and…to consider disputes between the administrations.”
The Government could have considered their own appropriate framework or forum for a proper consultation process with the devolved authorities and other key stakeholders in advance of beginning trade negotiations. The Secretary of State has, for example, reconvened the Board of Trade, of which he has appointed himself the president. Of course, for the Board of Trade to be effective, it would likely require significant expansion of its membership. Currently, I believe it has the sum total of one person—namely, the Secretary of State himself.
The creation of a formal consultation forum is essential before and during the negotiating process. In that respect, we will support the new clause. Of course, I wish to draw the Committee’s attention to our new clause 11—I hope it will be considered in a later sitting—which seeks to ensure that the JMC is convened for all trade agreements, including new trade agreements that correspond to existing EU agreements.
I hope that Government Members recognise from the Committee’s deliberations that this Bill contains a serious threat to the powers of the devolved Administrations, and that the installation of an appropriate consultation procedure to address such matters will assist Ministers in concluding agreements. Although this amendment seeks to mitigate any complications that might present at implementation stage after an agreement has been concluded, the Bill still fails to address the very serious concerns about the dilution of the devolved authorities’ powers in matters that may be considered within their devolved competence. In that respect, I ask the Government to address this matter either by supporting the new clause or by way of their own amendments to the Bill before it proceeds, with such amendments making clear that powers afforded to Ministers of the Crown under the Bill will not, and cannot, be used to undermine the rights and powers of the devolved Governments. If the Government do not seek to do that before the Bill progresses to its next stage, I assure the Minister that the Opposition will.
Greg Hands
Very briefly, in response to that long speech I have only three points to make. First, there is no serious threat to the devolved Administrations. What we are talking about is the transition of existing free trade agreements. The hon. Gentleman’s points—his parallels with the United States and so on—seemed to relate entirely to future trade agreements and not to the continuity of existing trade agreements. I also point out to him that the Secretary of State for International Trade has not appointed himself President of the Board of Trade. The Prime Minister has appointed him President of the Board of Trade.
Most importantly, the Bill is all about continuity and the technical transition of existing free trade agreements. The hon. Gentleman’s points seem to relate to future trade agreements, which will be a matter for another day.
Alan Brown
I take on board what the Minister says and know that logically it is correct in theory: this is just the roll-over of existing EU agreements into UK law. However, as the hon. Member for Brent North said, and as we heard from witnesses, there is still a risk that, even in trying to move over existing agreements, some matters come up for renegotiation. It is not crystal clear how matters will pan out and the new clause would at least give the protection of full analysis of the impact on the devolved nations in terms of any adjustments that end up happening in due process when we move over the existing agreements.
We have previously expressed our concerns about the UK Government getting competency in devolved matters, and the new clause would wrap up that aspect. For that reason, I will press the new clause to a vote.
Question put, That the clause be read a Second time.
Judith Cummins (Bradford South) (Lab)
I beg to move, that the clause be read a Second time.
The new clause calls for a process of review to examine the operation and impacts of all free trade agreements to which the Bill applies. Once again, let me make it clear that this applies to those comprehensive free trade agreements that are notifiable under GATT article XXIV and GATS article V. It does not apply to the many other trade agreements that fall under the undefined category of clause 2(2)(b).
We have already pressed for sustainability impact assessments to be conducted in advance of the start of negotiations towards those future UK free trade agreements that do not have a corresponding EU agreement. The new clause calls for there to be a parallel process of review after our free trade agreements have been in force for 10 years, and subsequent reviews every 10 years thereafter, which is essential to see how the agreements have worked and their effects. It will apply to all free trade agreements that fall within the scope of the Bill.
The call for regular reviews mirrors our earlier call for sustainability impact assessments in respect of the sectors to be covered, which would be a full disaggregation of the economic and social impacts of each free trade agreement, including the various regional impacts in different parts of the UK, as well as the impact on human rights, the environment, animal welfare and the interests of developing countries. Although the sustainability impact assessments to be carried out prior to new negotiations are ex ante, the reviews should represent a parallel process as far as possible ex post.
We have resisted the call from some quarters to require the reviews to take place every five years. Although we are keen to ensure regular monitoring of the impacts of any free trade agreements, we believe it will be more effective, given their reach and potential long-term consequences, to undertake fully comprehensive reviews less frequently, although the new clause provides for the option of holding earlier reviews when there is obvious social or economic harm as a result of a particular agreement.
The UK has an opportunity to establish best practice when it comes to the evaluation of international trade agreements. The EU produces annual reports on the workings of free trade agreements and can mandate a specific focus where there are particular concerns. For instance, the EU-Korea free trade agreement requires its annual monitoring reports to focus on sensitive sectors in addition to the standard implementation review. The EU also commissions more comprehensive external evaluations on a less regular basis—a major evaluation of the same EU-Korea free trade agreement is currently being conducted by two independent German institutes. It is examining a wide range of economic, social and environmental impacts of the agreement, including its impact on developing countries.
In addition, many countries have subjected their bilateral investment treaties to a thoroughgoing review in light of problems encountered as a result of the inclusion of investor-state dispute settlement clauses in previous treaties. Those reviews have led a number of Governments to question their previous agreements and in some cases to introduce radical alterations to the investment protection regime. Bilateral investment treaties have typically been subject to fixed terms of duration, after which it is possible to terminate them unilaterally, with reduced notice.
The Government will appreciate the wisdom of setting up a longitudinal system so that we can learn from the experience of our free trade agreements. Setting up such a system at the moment when the UK once again reclaims responsibility for trade policy will allow us to build a comprehensive set of data through which to register what has worked best and what still needs to be improved.
Hannah Bardell
I commend the hon. Lady on an excellent speech and an excellent new clause. Given the mess that the Government have got themselves in over impact assessments—it is making headline news around the world and we are becoming an international embarrassment as a result—does she agree that putting it in legislation that Governments of whatever colour must make proper impact assessments relating to whatever trade deals they have now or in future is absolutely vital?
Judith Cummins
I wholeheartedly agree with the hon. Lady that this is a straightforward example of best practice. We have a unique opportunity to get this right from the outset, and our new clause would allow us to do just that.
Greg Hands
The trade White Paper stated that our future trade policy would be transparent and inclusive, and we are committed to working with Parliament and the wider public to ensure that that is the case. It is important that the potential effects of trade agreements are considered as part of our trade policy, which is why the Government already conduct impact assessments on EU trade agreements where appropriate. However, it is not appropriate to legislate for that requirement in this Bill, which deals only with our existing trade arrangements.
I have to say that the new clause is not particularly well thought through. It calls for a review on each of the 40-plus agreements not just once, but twice. In 10 years —renewable in 20 years—there could be 80 or more reviews of these agreements, most of which are already in operation. Come 2039, the new clause might entail the Government conducting a review of an agreement that by then would already have been in place for 40 years. Therefore, the new clause should be withdrawn; it is not necessary.
Judith Cummins
I am struck by how limited the Minister’s ambition is for the UK. As I said in my speech, we have a unique opportunity to get this right and therefore I will press the new clause to a vote.
Question put, That the clause be read a Second time.
Alan Brown
I beg to move, That the clause be read a Second time.
The new clause is about how the Bill will be managed through the transitional period upon leaving the EU. To date, the Government have not clarified how a transitional period will affect the various legislation related to the UK’s withdrawal from the EU. To be fair to the Government, there is an obvious reason why they have not clarified that: as yet, there are no arrangements in place in terms of a transitional agreement, so they do not know what form a transitional period will take, how long it will be or if there will actually be one.
Assuming that the extreme Tory Brexit is averted and a deal concluded with the EU that includes an agreement on a transitional period, the new clause requires the Secretary of State to lay a report before Parliament ahead of the UK’s EU withdrawal on the application of this Bill during such a transitional period. The Minister might argue that the Bill relates only to existing EU agreements and to bringing legislation over. There have already been discussions about what happens if deals are signed but not ratified or further deals come on board with the EU. Those matters might need to be considered in terms of a transitional period, because they all relate to the terms of that period. This new clause aims to ensure that Parliament fully understands the impact of the transitional period and how the legislation will work.
Greg Hands
I am surprised that the official Opposition do not have anything to say to this clause. I thought that they took quite an interest in the application of the implementation period, but it appears not.
In any case, new clause 9 would require the Government to report to Parliament on how the Bill will be applied during the implementation period. I recognise the desire for clarity on how an implementation period will work and, specifically, how the powers in the Bill will be used in that period.
Irrespective of the exact terms of the implementation period, which need to be negotiated with the EU, as it stands the UK will no longer be part of existing EU FTAs or the government procurement agreement on leaving the EU. We will need the powers in the Bill to ensure continuity in our trading arrangements.
I also recognise the desire for clarity specifically on how trade remedies will work during an implementation period. We want to provide continuity to British industries, including retaining meaningful access to trade remedies.
Parliament will have plenty of opportunity to scrutinise an agreement between the UK and the EU, including on an implementation period. We have already committed to a vote on the final deal, and major policies in the withdrawal agreement will be enacted through primary legislation in the form of the withdrawal agreement and implementation Bill. I therefore ask the hon. Member for Kilmarnock and Loudoun to withdraw his new clause.
Barry Gardiner
The idea that the official Opposition have nothing to say on the matter is entirely wrong, but we have little to say because we agree with the new clause that is being proposed. We believe that it is eminently sensible. We are entering into a transition period, and it is right that Parliament should be brought up to date with what the Government’s intentions are. The new clause would do that. It is perfectly sensible.
Alan Brown
I listened to the Minister, who says that there will be lots of opportunity to debate the implementation period elsewhere and that, ultimately, we will have the take-it-or-leave-it vote in Parliament, but I would rather have security on these matters in the Bill. For that reason, I will press the new clause to a vote.
Question put, That the clause be read a Second time.
Taxation (Cross-border Trade) Bill (Sixth sitting)
(6 years, 10 months ago)
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The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Committee divided: - Ayes: 9 / Noes: 10 - Wragg, Mr William
The Committee divided: - Ayes: 9 / Noes: 10 - Question accordingly negatived.
The Chair
I remind the Committee that with this we are discussing the following:
Amendment 42, in schedule 4, page 66, line 6, leave out from “dumping” to end of line 7.
This amendment is consequential on Amendment 41.
Amendment 43, in schedule 4, page 66, line 7, at end insert—
“(3A) The provisions of sub-paragraph (3) are subject to the provisions of sub-paragraphs (3B) and (3C).
(3B) If the TRA finds that the dumping has been fully or partially caused by market distortions affecting the prices of raw materials or other industrial inputs paid by the exporting producers, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (3)(a).
(3C) If the TRA finds that there is an inadequate level of social and environmental protection in the exporting country, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (3)(a).”
This amendment provides for the anti-dumping amount to be the margin of dumping in certain specified circumstances.
Amendment 44, in schedule 4, page 66, line 8, leave out paragraph (4) and insert—
“(4) For the purposes of sub-paragraph (3)(b) the TRA shall, in determining the amount which it is satisfied would be adequate to remove the injury described in that provision, take account of all elements of the material injury being caused to the UK industry, including, but not limited to, the impact of reduced sales volumes, price suppression and curtailment of investment.
(4A) Regulations may make further provision for the purposes of sub-paragraph (4).”
This amendment makes provision on the face of the Bill for the main factors to be considered in determining the amount for the purposes of paragraph 14(3)(b).
Amendment 49, in schedule 4, page 69, line 18, leave out from “dumping” to “in” in line 19.
This amendment removes the reference to the amount of the subsidy as an upper limit on the anti-dumping amount in the recommendation under paragraph 18.
Amendment 50, in schedule 4, page 69, line 22, leave out from “dumping” to end of line 23.
This amendment is consequential on Amendment 49.
Amendment 51, in schedule 4, page 69, line 23, at end insert—
“(4A) The provisions of sub-paragraph (4) are subject to the provisions of sub-paragraphs (4B) and (4C).
(4B) If the TRA finds that the dumping has been fully or partially caused by market distortions affecting the prices of raw materials or other industrial inputs paid by the exporting producers, the anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (4)(a).
(4C) If the TRA finds that there is an inadequate level of social and environmental protection in the exporting country, the estimated anti-dumping amount shall be the margin of dumping as determined in accordance with sub-paragraph (4)(a).”
This amendment provides for the anti-dumping amount to be the margin of dumping in certain specified circumstances.
Amendment 52, in schedule 4, page 69, line 24, leave out paragraph (5) and insert—
“(5) For the purposes of sub-paragraph (4)(b) the TRA shall, in determining the amount which it is satisfied would be adequate to remove the injury described in that provision, take account of all elements of the material injury being caused to the UK industry, including, but not limited to, the impact of reduced sales volumes, price suppression and curtailment of investment.
(5A) Regulations may make further provision for the purposes of sub-paragraph (5).”
This amendment makes provision on the face of the Bill for the main factors to be considered in determining the amount for the purposes of paragraph 18(4)(b).
Peter Dowd (Bootle) (Lab)
I will continue not only to move amendment 41, but to look after the interests of parliamentary democracy and British industry. It is good to see you in the chair again, Mrs Main.
I started to talk about the creation of the mandatory lesser duty rule, which instead results in lower duties that in some cases may not reflect the actual injury. It is labour intensive for the investigating authority and it does not reflect the full level of market distortion. It is also worth pointing out that a small minority of World Trade Organisation members use a mandatory lesser duty rule. The EU is moving to a conditional application because it has seen weaknesses in having a mandatory lesser duty rule. If the UK adopts a mandatory lesser duty rule, our trade remedies will be, in effect, an outlier.
The incorporation of amendments 41, 42, 43, 44, 49 and 50, 51 and 52 into the Bill would ensure that UK trade remedies post-Brexit will closely mirror the evolving EU practice, whereby the lesser duty rule will not be applied in anti-subsidy cases, or in fact in anti-dumping cases, where state-distorted raw material markets have been a factor in enabling or aggravating dumping. Reflected in our amendments is the rule that is practised by the EU but not mandatory under the WTO, which states that
“duties should be calculated to remove either the amount of dumping/subsidy found, or the injury found, whichever is the lower.”
The amendments lay out specific circumstances where the margin of dumping would be applied over a lesser duty rule. These circumstances include where the Trade Remedies Authority finds that the dumping of goods is directly linked to market distortions that affect the price of raw materials, for example in the case of Chinese steel, which is heavily subsidised by the state, and where it finds inadequate levels of social and environmental protection in the exporting country. These specific circumstances mirror the current regulation that the EU follows when determining trade remedies. In a sense, the amendments try to be in the spirit of that.
The Government have offered no evidence of why a mandatory lesser duty rule would be beneficial in comparison with the flexibility to exercise a lesser duty rule on a case-by-case basis. We all know from the evidence session that a representative from the trade unions, and others who work in key sectors pointed out that they had seen no evidence that a mandatory lesser duty rule works, is desirable and that the UK needs it. The amendments go to the heart of trying to deal with that particular issue.
Currently, only nine of the 30 remaining anti-dumping users in the WTO have a mandatory lesser duty rule. They include: Australia, Brazil, India, Israel, New Zealand, Turkey and Thailand. Only three have both the public interest test and a mandatory lesser duty rule, which is what schedule 4 proposes. That includes the EU, Brazil and the Eurasian Customs Union. Detailed evidence given by Cliff Stevenson to the Department for Business, Energy and Industrial Strategy using the Eurostat update looked at four cases where the lesser duty rule was applied over the dumping rate. In the case of the dumping of cheap aluminium road wheels from China, to which I referred earlier in relation to TUC evidence, the EU adopted the lesser duty rule in 2010, with the injury margin of 22.3%. It is important to look at that in relation to the amendment.
The dumping margin permitted by the WTO was from 23.8% to 67.7%, meaning that the margin adopted was 1.5% less than the lowest estimation of the dumping margin. According to Stevenson’s study, the EU’s adoption of the lesser duty rule has had no impact on the volume of cheap aluminium road wheels imported into the EU from China. We have tabled the amendments because we do not believe that the framework—skeleton or otherwise—addresses the issue.
In the case of ceramics, the EU introduced trade remedies in late 2010 against the import of continuous filament glass fibre products from China. Again, it chose to adopt a lesser duty rule when investigating the injury level. The injury margin was set between 7.3% and 13.8%, while the dumping margin permitted by the WTO is between 9.6% and 29.7%. The rate adopted by the EU is therefore at least 2.3% below the dumping margin. Stevenson’s research shows that the EU’s trade remedies have had little impact on the importation of continuous filament glass fibre from China; since they were adopted, rates have largely remained consistent. Our amendments are a genuine attempt to deal with that problem.
Some have argued that the adoption of the lesser duty rule protects the consumer against being ripped off when the dumping margin is calculated and added to the price of the products imported. However, the claim that prices do not rise significantly because tariffs are imposed at too high a rate was dispelled clearly, compellingly and authoritatively by Gareth Stace, director of UK Steel, in his evidence to us last week:
“I have an example. In the hot rolled coil case recently—hot rolled flat is used for car bodies…the injury margin was 17.5% and the dumping margin was 29%.”
The lesser duty rule was applied by the EU. Gareth Stace continued:
“That is a difference of 11%...If we think of a luxury car that cost €45,000…if the lesser duty rule was not applied in this case, it would increase the value of the €45,000 car by €16.”––[Official Report, Taxation (Cross-border Trade) Public Bill Committee, 23 January 2018; c. 71-72, Q109.]
Disapplying the mandatory lesser duty and giving the Trade Remedies Authority the flexibility to apply a higher dumping margin if necessary will not mean sudden runaway costs being handed on to the consumer—quite frankly, I consider that a myth that needs to be dispelled, preferably as soon as possible. Importantly, higher dumping margins will be considered only when dealing with heavily distorted economies.
The amendments would ensure that the United Kingdom has trade remedies that maintain free and liberalised trade, as well as providing a safety valve to UK producers and manufacturers. That, in turn, will have a positive impact on consumers. We seek not to introduce protectionist measures, but to ensure a level playing field for UK manufacturers. We want to protect the steel industry, for example; my hon. Friend the Member for Scunthorpe has made that point on many occasions and he is absolutely right, as I know his constituents recognise. Our amendments would provide a remedy to the unfair competition that arises when overseas manufacturers do not play by the same fair rules as UK manufacturers. Giving the Trade Remedies Authority the power to establish the correct level of injury is so important.
I exhort hon. Members to consider our amendments carefully, and the Minister to accept them in the spirit in which they are intended.
Nic Dakin (Scunthorpe) (Lab)
It is a pleasure to see you in the Chair again, Mrs Main. In supporting the amendments tabled by my hon. Friend the Member for Bootle, I, too, draw on the evidence of Gareth Stace, director of UK Steel. He was compelling when he said:
“One of the aims of Brexit was to strip things away, make things more simple and have less people employed working on these things”.
If Brexit is about taking the opportunity to get some sort of bounty that makes things better, herein lies an opportunity for us to do that.
Mr Stace went on to say that
“calculating the dumping margin is a really easy process. It can be done fairly quickly. It does not need a lot of people to do it and does not need a lot of work from industry and the Government. Calculating the injury margin does. It is a bit of a black box—you do not know what is going to come out of it—whereas the dumping margin is very transparent.”––[Official Report, Taxation (Cross-border Trade) Public Bill Committee, 23 January 2018; c. 71-2, Q109-10.]
That is why the EU is going for a conditional application of the lesser duty rule, which is the right direction of travel. It makes it slicker and simpler, and still effective. There is an opportunity for the UK to do the same—or even better.
To look at comparators in terms of timeliness, speed and pace of decision making, systems in the US are put in place within 45 days—we all commend the US as a bastion of free trade, yet that is how it ensures its industry is not disadvantaged in particular ways—whereas until recently in Europe it had been after 9 months. There is an opportunity for the UK to get things slicker and faster than for the EU currently, with one such way being to move towards conditional use of the lesser duty rule, as is implicit in the amendments. I hope that the Government are listening and willing to take this opportunity.
The Parliamentary Under-Secretary of State for International Trade (Graham Stuart)
It is a pleasure to serve under your chairmanship, Mrs Main, and to be in this reassembled Committee, probing and holding the Government to account on this excellent framework Bill. The amendments in the group look to set the parameters around what the TRA can recommend by way of anti-dumping and anti-subsidy measures. I begin by reassuring the Committee that the UK trade remedies system will provide robust protections for UK industries where they are suffering injury because of dumped or subsidised imports, or because of unforeseen surges in imports.
Amendments 41 and 49, and their consequential amendments, would remove the requirement that provisional anti-subsidy measures recommended by the TRA must not exceed the subsidy margin. WTO rules clearly provide that anti-dumping measures cannot exceed the margin of dumping and anti-subsidy measures cannot exceed the amount of subsidy. That is a strict requirement, applying to both provisional and definitive measures, which is reflected in schedule 4. Let me clarify that our policy intention is simply to incorporate those WTO rules and not to provide that the amount of subsidy somehow offsets the dumping margin, or vice versa—I think there may have been some misunderstanding of the Bill’s phrasing.
Schedule 4 relates to both anti-dumping and anti-subsidy investigations, which are largely identical. That is why the provisions refer to both the margin of dumping and the amount of subsidy. By removing the requirements around the maximum amount of anti-subsidy measures, the amendments would mean that the Bill would not be compatible with WTO rules. I am sure that was not the intention.
Amendments 43 and 51 would restrict the application of the lesser duty rule in cases of raw material distortions and when the exporting country does not respect adequate levels of social and environmental standards. The lesser duty rule achieves our objective of protecting UK industry by ensuring that it can operate on a fair playing field without causing unnecessary injury to UK consumers and downstream industry.
The evidence shows that trade remedy measures are effective and have a lasting impact even with a lesser duty rule in place. Anti-dumping duties on a range of important steel products determined under the lesser duty rule have been very effective in curtailing dumped imports from China. For example, in the year to August 2017, UK imports from China of rebar hot-rolled and cold-rolled flat products were down by more than 90% compared with the year leading up to their respective anti-dumping investigations. There is, therefore, no evidence of a need to remove the lesser duty rule in the case of raw material distortions. Measures are already clearly effective in addressing the injury caused by those practices.
Peter Dowd
I completely take those points in the spirit of co-operation and conciliation that we are trying to get in the Bill. This is not about one side attacking industry and the other side protecting consumers. It is about the balance. That is the question we have to ask ourselves today: does the Bill give the balance we need? With our amendments, we are trying to say that we believe it will give the balance between producers and consumers. The Minister talked about it being an untested concept, but this whole Bill is an untested concept. This whole experience and journey we are having in relation to Brexit, which we genuinely have to try to make the best of, is the father of untested concepts. This untested concept is just one of the many little ones compared with the totality. We are in a complicated, three-dimensional landscape. That is the nature of the beast and of where we are, and we have to try to make the best of it.
Our amendments are genuinely an attempt to listen to what the witnesses were saying to us. I know we can cherry-pick evidence here and there, but the tone that we got from the witnesses, from those who have subsequently put other evidence in and from our own backgrounds—our knowledge and context of these issues, and the discussions that we have all had outside this room—leads us to believe that the Government, in the round, are perhaps going a step too far. Our amendments are an attempt to bring the balance back. There does not appear to be any significant evidence from what I can see that the producer is in any significant way disadvantaged, because we were clearly told that it was a convoluted and complicated market. I understand where the Minister is coming from, but we have a different perspective.
My final point is that in their evidence many of the witnesses were concerned about the Government not listening to them. They were, in a sense, coming to Parliament as some sort of intermediary, to get Parliament to try to act on their behalf and to be a voice with the Government. That is why they were saying to us that they needed the parliamentary protections. That has been part of our push.
The amendments balance the needs of both producer and industry, and on that basis, while I acknowledge everything the Minister said, I do not think we are able to withdraw them. We have to make that point clearly and unambiguously.
Graham Stuart
We have not heard any evidence of the lesser duty rule not working in practice. I have been able to rebut any suggestions. The hon. Member for Scunthorpe said that the US imposes measures in 45 days. As everyone on this Committee who is not as busy as he is will know from reading their papers, that is simply not true. The WTO rules prevent the imposition of provisional anti-dumping and anti-subsidy measures before day 60 of the investigation. The US makes a preliminary injury determination in 45 days, but that does not mean the imposition of measures. That was completely incorrect, and I am sure the hon. Gentleman will want to correct the record. The average time that the US takes to impose provisional measures is just under five months, and in most steel cases it takes around six months.
Nic Dakin
The Minister is absolutely right that, after 45 days, an interim decision is made. That essentially gives confidence to the industry. The amendments are an opportunity for the Government to take measures quicker. At the height of the steel crisis, the lesser duty rule did not help. It took a long time for things to come in. The problem is time and space. The other thing is that the UK will be one of very few countries in the world that apply the lesser duty rule without exception if it goes ahead in this way—out of step and out of place. This is an opportunity to be in the right place.
Graham Stuart
The hon. Gentleman accepts that measures are not imposed in 45 days. He presented no evidence—I believe there is none—to suggest that the lesser duty rule in any way slows things down, so the slowness of the process in the EU responding to the steel crisis is an entirely separate element. I know he is scrupulously fair and always seeks to be, so he would recognise there is no linkage, although he may have wished there to be one to bolster an argument that has otherwise turned out to have no basis whatsoever. On that basis, I ask for the amendments to be withdrawn.
Question put, That the amendment be made.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I beg to move amendment 45, in schedule 4, page 66, line 24, after “must” insert “within two weeks”.
This amendment prescribes a period within which the Secretary of State must decide whether to accept or reject a TRA recommendation.
The Chair
With this it will be convenient to discuss the following:
Amendment 47, in schedule 4, page 68, line 42, leave out from beginning to “to” and insert
“will normally be 5 years unless the TRA considers that a shorter period will suffice”.
This amendment creates a presumption that the specified period will be 5 years.
Amendment 48, in schedule 4, page 69, line 7, leave out from “20(4)(c))” to end of line 8.
This amendment removes the provision for the TRA to recommend an earlier date than the day after the day of publication of the public notice.
Amendment 53, in schedule 4, page 69, line 30, leave out from “that” to end of line 34 and insert
“an anti-dumping amount or a countervailing amount should apply to goods from the day after the date of publication of the public notice under section 13 giving effect to the recommendation.”
This amendment removes the provision for the TRA to recommend an earlier date than the day after the day of publication of the public notice.
Amendment 54, in schedule 4, page 70, line 9, after “must” insert “within two weeks”.
This amendment prescribes a period within which the Secretary of State must decide whether to accept or reject a TRA recommendation.
Jonathan Reynolds
It is a pleasure to serve under your chairmanship, Mrs Main. I will speak to amendments 45, 47, 48, 53 and 54, relating to time periods. I draw the Committee’s attention in particular to amendment 45, which prescribes a period within which the Secretary of State must decide whether to accept or reject the TRA recommendations—in this case the recommended period is two weeks—and amendment 47, which corrects the presumption that the specified period will be five years. That relates to the amount of time for which special measures regarding TRA recommendations will be enforced.
The general principle of the amendments we seek today is to provide greater clarity and certainty to UK industry about the terms of engagement with the new TRA. As I believe we have placed on the record, this is a framework Bill—it is a piece of legislation where many key details for the trading regime in future are unidentified. Therefore, we remain somewhat vague about what the modus operandi of the TRA will be. Too much is being left to the whims of that authority and the Secretary of State. We believe it is important to set out guidelines at this stage that give greater clarity to the role and scope of TRA activity.
One way to achieve certainty is to bring an easily-observed, enforceable time limit on the activities both of the TRA and the Secretary of State and their relationship with each other. These amendments have been brought forward in consultation with the Manufacturing Trade Remedies Alliance, which has significant insight into what UK industry needs from future trade defence policy.
Amendments 45 and 54 would mandate the Secretary of State to make a decision on TRA recommendations within two weeks. As the MTRA highlights, although there is provision in the Bill for a deadline to be brought on the TRA through secondary legislation at various points in an investigation, there are none specified for the Secretary of State. In theory, that would allow decisions to be delayed indefinitely. Let us imagine a situation in which the UK is led by such an indecisive Government that members of the Cabinet could not agree with each other on our future trading relationships—that would be a problem. The scenario is hard to envisage, but we should surely safeguard against it.
In today’s globalised economy, markets and events can move much faster than we would ever have anticipated. In a short time, key UK markets could suffer serious injury if appropriate remedial action were not taken quickly. In fairness to Ministers, we have heard that speed of decision-making is something they are looking to achieve. This is surely the rationale behind the Government’s decision to stipulate deadlines on TRA investigations, to prevent time lags occurring which could bring that about. In the Opposition’s view, it seems ineffective to include these requirements but not mirror them for the Secretary of State in accepting the recommendations of TRA investigations. That raises a concern that there could be an option simply to kick the can down the road when a politically difficult decision presents itself. We believe that the MTRA recommendation of a two-week deadline in which the Secretary of State must reach a decision is reasonable and would protect against such abuses.
In a similar vein, the Bill specifies a maximum five-year period but no minimum with regard to the time considered necessary for duties to be imposed, where that forms part of the TRA’s recommendations. It merely states that duties should be imposed for such a period as the TRA considers necessary. However, as the MTRA points out, it is considered normal practice globally for anti-dumping and anti-subsidy measures to last for a minimum of five years, including within key partner markets in the EU and the US. The alliance suggests, therefore, that the default duration of duties should be five years, starting from the date of definitive measures. The Opposition agree.
It is vital to add certainty where we can for UK industry and that we align with our global trading partners to gain consensus and be as consistent as possible on the universally accepted World Trade Organisation principles. I therefore call on the Committee to support the amendments.
Graham Stuart
Three groups of amendments need a response. I will start with amendments 45 and 54, which seek to impose a two-week time limit on the Secretary of State’s decision to accept or reject the TRA recommendation. I will then turn to amendment 47, which seeks to create a presumption of five years as the normal, rather than the maximum, duration of definitive measures. Finally, I will address amendments 48 and 53, which seek to ensure that the duration of definitive measures is not affected by the length of any provisional measures that might have been applied against the same imports.
On amendments 45 and 54, on receipt of the TRA recommendation, it is the responsibility of the Secretary of State to respond in a timely manner, while ensuring that the public interest aspect of their role is given due weight. We fully recognise that a swift response is crucial to UK industry, as the hon. Gentleman said, so that the injury being caused by unfair trade practices can be halted. However, in some cases there will inevitably be difficult matters that the Secretary of State will need to reflect on. Although we expect that such matters will be rare, it is important that he has full opportunity thoroughly to consider the issues in making his decision. That might lengthen the process, but it is important to do the job well rather than quickly. To place an arbitrary two–week time limit on the Secretary of State is, therefore, not appropriate. Even though that duration might be sufficient in most cases, the legislation must provide flexibility for cases in which complex considerations must be made in the public interest.
As the hon. Gentleman is aware, once the investigation has been concluded and measures have been proposed by the TRA, the pressure on the Secretary of State quickly to come forward with the adoption of the measures to protect British industry will be great. I perhaps lack the hon. Gentleman’s imagination, but I find it hard to imagine a situation in which the pressure on the Secretary of State to get on with it would not be much greater than a pressure to delay and put it into the long grass, as the hon. Gentleman said. I think we can be confident that any Secretary of State under any Government would wish to make the decision as quickly as reasonably possible.
For those reasons, I do not agree with an arbitrary two-week limit. I understand why the hon. Gentleman has tabled the amendment and I hope it is a probing one. I understand what lies behind it, but I hope I have reassured him.
On amendment 47, it is important to note that the WTO agreements set out that measures may remain in force for up to five years. They do not provide that five years is the default. In fact, they specifically set out that measures should remain in force only for as long as, and to the extent, necessary to counteract the dumping or subsidisation that is causing injury. The TRA analysis may suggest that a period shorter than five years will be sufficient to counteract injury, and in such cases the TRA should set an appropriate duration accordingly.
On request, the TRA will initiate an expiry review before the termination of any measures, provided that UK industry can demonstrate that injury would continue or recur if the measures were to expire. If the review finds that continued application of measures is required to maintain sufficient protection for UK industry, the measures will be continued. I assure the hon. Gentleman that industry is adequately protected without the need for the amendment and I ask him to consider withdrawing it.
Finally, on amendments 48 and 53, I understand the hon. Gentleman’s concerns, but I have to reassure him that that which he fears is not the intention of the provisions. The WTO agreements allow in certain circumstances for trade remedies to be applied from a date prior to the date of the application of definitive measures. The purpose of the provisions is to allow us to reflect that in secondary legislation, not to shorten the duration of definitive measures. We are not seeking to shorten the duration of definitive measures, but are seeking to allow trade remedies to be applied from a date prior to the date of those measures.
The unintended consequence of the Opposition amendments would be to prevent the TRA from collecting duties for a period before the date of the section 13 notice, even though this is permissible under the WTO agreements in limited circumstances. I entirely understand why the hon. Gentleman tabled the amendment and what he was seeking to probe. I hope my explanation has been sufficient to make him see that that which he desires will not be delivered by the amendments.
We believe that this is a necessary provision. We have been clear that we want to incorporate all of the protections permitted under WTO rules into the UK’s trade remedies framework. Removing the ability to do that could be detrimental to the protections available to UK industry. It is on that basis that I ask him to consider withdrawing the amendment.
Kirsty Blackman (Aberdeen North) (SNP)
I express the Scottish National party’s support for the Opposition amendments. It is sensible that we are asking the Secretary of State to make a decision within a relatively short time period because, as has been stated, we do not want that to be dragged out for any significant length of time. It is reasonable that, after a significant investigation has taken place—and the TRA’s investigations will be significant—the Minister will quickly review the evidence presented and make a decision in the shortest possible time.
On amendment 47 and the five-year period, I have the Department for International Trade call for evidence on the current EU trade remedy measures. I can see possibly one that is in place for less than five years. In fact, many have been place for over a decade because they have been renewed. It is very unusual in that document, which lists all the trade remedy measures currently in place, for any of them to have a review date of less than five years. It is completely reasonable that the Opposition are asking for the starting period default to be five years, and for the TRA to decide on a lesser period in compelling circumstances. Given the number of these measures that have been extended and how few of them have fallen at the five year period, I suggest that five years is likely to be a reasonably short period for trade remedies to be in place, and that it is sensible for them to extended as a result.
We are talking about the trade remedies body doing substantive investigations and coming up with a huge amount of evidence. Asking it to do so on more than a five-yearly basis would probably be adding to their workload unnecessarily. The Opposition’s suggestion is incredibly sensible in that regard. The presumption should be five years, and the TRA should make decisions for it to be less if it believes that that would be appropriate.
Jonathan Reynolds
I appreciate the Minister’s response but it is our intention to move these amendments to the vote.
In respect of amendment 45, the Minister has already talked about the political pressure that has almost certainly been brought in the event of the TRA making a determination. However, it is also true that there are many examples we could go through of Governments resisting such political pressure. We should bear in mind that, in our discussions earlier, the Government effectively brought back a new constitutional procedure in order to stress the need for speed of announcements. Therefore, it does not seem consistent this afternoon to say that there is very little flexibility offered by the need for speedy resolution of cases.
Amendment 47 offers flexibility where five years would not be appropriate, but as the hon. Member for Aberdeen North just said, given the standard length of time these measures tend to be in place, this is—as industry has told us—a fairly modest measure, making it consistent with industry practice. We will press the amendment to a vote, Mrs Main.
Peter Dowd
I beg to move amendment 46, in schedule 4, page 67, line 6, at end insert—
‘(6A) For the purposes of this Schedule, references to the “public interest” are to be construed as relating to the security of the United Kingdom and its citizens.”
This amendment provides a definition of public interest for the purposes of Schedule 4.
The Chair
With this it will be convenient to discuss the following:
Amendment 60, in schedule 4, page 79, line 15, at end insert—
‘(2A) References in this Schedule to the “public interest” are to be construed in accordance with paragraph 15(6A).”.”
This amendment is consequential on Amendment 46.
Amendment 71, in schedule 5, page 85, line 39, at end insert—
‘(5A) For the purposes of this Schedule, references to the “public interest” are to be construed as relating to the security of the United Kingdom and its citizens.”
This amendment provides a definition of public interest for the purposes of Schedule 5.
Amendment 77, in schedule 5, page 97, line 38, at end insert—
‘(2A) References in this Schedule to the “public interest” are to be construed in accordance with paragraph 13(6A).”.”
This amendment is consequential on Amendment 71.
Peter Dowd
The amendment is about the public interest and I think the public have a particular interest here. The amendments to schedules 4 and 5 would define the public interest as referring strictly to the national security of the United Kingdom and its citizens. As drafted, the measures in schedules 4 and 5 would create a public interest test that would allow the Secretary of State to veto any recommendations on the adoption of trade remedies from the Trade Remedies Authority on public interest grounds.
To be clear, the WTO does not require the UK to adopt a public interest test. In fact this would put the UK in an extreme minority, as only other multi-national members of the WTO, such as the EU, and Brazil currently operate a public interest test. If we consider countries operating both a public interest test and a mandatory lesser duty rule, that puts the UK in an even smaller and pretty selective group. All the countries that currently have a form of public interest also clearly define what the public interest actually is. We do not appear to do that.
Several witnesses who gave evidence last Tuesday pointed out that the establishment of a public interest test as outlined in schedules 4 and 5 is overkill at best, and overreach at worst. The representatives of the UK ceramics, steel and chemicals industries were divided on the number of tests the Government have set out in schedules 4 and 5 and which have to be met before trade remedies can be issued. The director of UK Steel counted as many as six in the current provisions, with five economic tests and one public interest test. That is why we want to narrow the focus, as the Government do not appear to have done so, although they might say that they will.
Although there is clearly a case for assessing the economic impact of trade remedies on key sectors of the economy and certain exports, the establishment of an undefined public interest test is more worrying. Currently, schedules 4 and 5 would give the Secretary of State for Trade carte blanche to define what is and is not in the public interest. The lack of a definition means that the public interest is largely subjective. It puts the Secretary of State in a similar position to his opposite number in Australia, where the Trade Minister, according to a report from the Department for International Trade, has “unfettered discretion” to choose not to impose measures. Using those vague new powers, could not the Secretary of State argue that flooding UK markets with cheap chlorinated chicken from the US is in the public interest, or that cheap aluminium wheels from China would lower the cost of cars and therefore also be in the public interest?
It is not only the Opposition who are concerned about the Government’s lack of clarity about what might be considered to be in the public interest. In her evidence to the Committee, Dr Cohen, chief executive of the British Ceramic Confederation, expressed her alarm at the prospect that the test could be used to justify a future free trade agreement with China based on levels of potential inward investment. It appears that an undefined test could lead quickly to a scenario in which the public interest is not only conflated with the interests of consumers, but wholly dependent on the personal perceptions and considerations of whoever holds office in the Department for International Trade. Our amendment therefore tries to define public interest more tightly.
The EU’s anti-dumping regulation defines the public interest as being
“based on an appreciation of all the various interests taken as a whole, including the interests of the domestic industry and users and consumers”.
We think that definition is too broad and open to interpretation. Amendment 46 and the consequential amendments would instead require the Government to adopt a definition of public interest for the purposes of schedules 4 and 5 that relates specifically to national security. Under such a definition, the Secretary of State’s power to veto TRA trade remedy recommendations using a public interest test would be constrained to situations involving harm to national security.
The Opposition consider that in an extreme case, such as the United Kingdom going to war, national security considerations would supersede and far outweigh the arguments for trade remedies. Any discussion of national security would have to involve other Cabinet members, including the Defence Secretary, the Home Secretary, the Foreign Secretary and the Prime Minister. A more consensual approach would have to be reached, either by the Cabinet or by a Cabinet Sub-Committee, to establish whether the suggested remedies would harm national security interests.
Closely restricting the public interest test to issues of national security arguably leaves a broad definition, which some argue the Government could seize on and push to the very limit—for example, the Secretary of State could reject trade remedies on Chinese steel under the guise of national security by claiming that cheap steel from China is needed for energy security and the next generation of nuclear power plants—but I believe that the tight definition outlined in our amendments would limit that ability. Furthermore, I suspect that few Cabinet colleagues would support such a crude interpretation of national security, as it could interfere with their briefs and would only raise further questions.
An undefined public interest test would give the Secretary of State vast powers that could easily lead to abuse. Our amendments therefore seek to define “public interest” sensibly to constrain those powers, to open a wider discussion between the Secretary of State and other Cabinet members, and to limit use of the public interest veto to times of national emergency. However, we are not just pushing on regardless. If the Minister wishes to elaborate on what “public interest” could mean—the extent of it, who decides whether to invoke it, the process and steps for arriving at such a decision, and the checks and balances in place—we will be more than happy to listen.
Graham Stuart
As the hon. Member for Bootle has explained so fluently, his amendments would make it clear that the Secretary of State could use public interest grounds to reject the TRA’s recommendations for the imposition of duties only in limited circumstances, namely those in which national security was deemed to be at risk.
It may help hon. Members if I briefly run through the interaction of checks and balances in the trade remedies system. As we have discussed, the TRA is required to conduct an economic interest test when deciding whether to recommend the imposition of measures. There is a presumption in favour of the imposition of duties in respect of anti-dumping and anti-subsidy measures. However, it is not for the TRA to take into account wider public interest considerations such as matters of national security, as the hon. Gentleman mentioned, nor to determine whether the imposition of duties would run counter to wider Government policy.
When the Secretary of State receives the TRA’s recommendations, he will satisfy himself that the TRA has properly weighted the individual elements of the EIT and that imposing duties is in the public interest. Only where there is a strong argument against following the TRA’s recommendations will the Secretary of State reject putting measures in place. In the exceptional case where he does, he will be required to explain his decision to Parliament.
The hon. Gentleman mentioned Gareth Stace of UK Steel and his evidence. It is worth putting on the record that when discussing a public interest test, he said
“you need a public interest test at the end, because there may be those extraordinary circumstances where it is or is not in the public interest to apply or not apply tariffs.”––[Official Report, Taxation (Cross-border Trade) Public Bill Committee, 23 January 2018; c. 73, Q111.]
So in fact, UK Steel gave evidence supporting public interest tests.
Other Governments, including those of the United States, Canada, Australia and New Zealand, and the EU take public interest into account when deciding whether to impose measures, so we are not acting out of step with other countries. I dispute what the hon. Gentleman said.
Peter Dowd
Does the Minister at least acknowledge that, notwithstanding what he has said, those countries have a more clearly defined test? Whether he agrees with it or not, their public interest test is a bit tighter and clearer. Ours appears to be rather loose, to say the least.
Graham Stuart
It is not really a test. It is a final common-sense check that the measures will not run against our national security interests or wider Government policy, as the hon. Gentleman set out—all the pressures that we discussed in a previous debate. The pressure will be on the Secretary of State. Industry will call for the inquiry and participate in the TRA’s investigation, then the TRA will come out and say that the economic interest test and the market share threshold have been passed and that it has decided that we need to impose these measures. After that, the Secretary of State will give it a sense check, and in extraordinary circumstances might say no.
In his recent article for UK Trade Forum, George Peretz QC said that such decisions are
“best made by politicians who can, and will have to, defend those decisions in the political arena.”
It is right that there is a role for Ministers to take those public interest considerations into account and intervene if imposing measures is not in the UK’s wider interest. It is also right that they are accountable to Parliament if they do so. The system that we have proposed, whereby an independent body carries out the investigation and makes recommendations, but Ministers ultimately have responsibility for acting in the country’s best interest, is the right one. I hope hon. Members agree and that the hon. Gentleman will agree to withdraw the amendment.
Peter Dowd
As I said earlier, when we are talking about very important matters, we are prepared not to push amendments to a vote in the spirit of co-operation and conciliation. This is one of those occasions, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: 47, in schedule 4, page 68, line 42, leave out from beginning to “to” and insert
“will normally be 5 years unless the TRA considers that a shorter period will suffice”.—(Jonathan Reynolds.)
This amendment creates a presumption that the specified period will be 5 years.
Question put, That the amendment be made.
Anneliese Dodds (Oxford East) (Lab/Co-op)
I beg to move amendment 55, in schedule 4, page 70, line 39, at end insert—
“(2A) Reviews under this paragraph shall only be initiated after a period of at least 12 months has elapsed since the measures subject to that review were implemented in accordance with paragraph 20(4), except that a review requested by a new supplier to the United Kingdom of the level of duties applicable to that new supplier may be initiated earlier.”
This amendment provides for a general minimum period of 12 months prior to initiation of a review except in prescribed circumstances.
The Chair
With this it will be convenient to discuss amendment 56, in schedule 4, page 71, line 33, at end insert—
“(4A) All measures implemented in accordance with paragraph 20(4) will continue to be applied during the conduct of any review under this paragraph into those measures.”
This amendment provides for measures to remain in place while a review is conducted of them.
Anneliese Dodds
It is a pleasure to serve with you in the Chair once again, Mrs Main.
Like many of the Opposition’s amendments, amendments 55 and 56 try to improve the legal certainty in the Bill. They would ensure that reviews could not normally be opened into measures that were less than one year old, in line with EU practice, and that duties remained in place while reviews were conducted. With no restriction on the time period before which reviews can be initiated, the UK again appears to be ploughing its own furrow and going against the international direction of travel. I note from much of the previous debate and the comments from the hon. Member for Aberdeen North, who rightly indicated that the average cycle for this kind of remedy is five years, that it is a long-term cycle, and without the expectation of review before the remedy having been in place for one year.
Since reviews can be initiated after an interested party asks for one, WTO rules require a reasonable time to have elapsed since the imposition of definitive measures, and that has almost always, from what I can see, been interpreted as being at least one year. The only exception seems to be the US, where the standard review period is one year, but that is apparently unusual. In the EU, at least a year must have passed.
The problem with earlier reviews is that they could be administratively costly, after having put a remedy into action, and that they would reduce the predictability of the trade remedies regime. The latter is surely essential for the long-term health of British manufacturing, which needs to know that the business environment will not change radically in the very short term. With uncertainty appearing to be one of the factors underlying the current low levels of private sector investment in the UK, we surely must ensure that trade remedies are proportionate and do not make our British firms less secure than if they were based in other industrialised countries.
Kirsty Blackman
The hon. Lady makes a compelling case and I want to reassure her that Scottish National party Members will support the Labour party in the incredibly sensible move it looks to make, particularly with amendment 55.
Anneliese Dodds
I am grateful to the hon. Lady for the SNP’s support. The amendments focus on trying to provide the certainty that the Bill lacks but which is present in other trade remedies systems. Will the Minister indicate whether the Government have considered inserting such a provision in the Bill, in line with international practice? If not, will he say why not, given that no other country seems routinely to allow a review before a year has passed?
Graham Stuart
Amendment 55 seeks to provide a timeline in relation to reviews of continuing application of an anti-dumping amount or countervailing duty amount. Amendment 56 asks that definitive anti-dumping and countervailing duties will continue to be applied during the investigation process of any review.
On amendment 55, let me start by explaining that there are a number of different types of reviews of definitive anti-dumping and countervailing duties, which apply in different circumstances—for example, to reflect the appearance of a new exporter, to address evidence that measures are being circumvented, or to review measures that are due to expire, to determine whether it is necessary to extend them. Reviews ensure that measures can be changed where and when appropriate. I recognise the desire for clarity regarding timelines in the review’s framework, but as demonstrated by the WTO agreements and EU rules, there is no uniform timeline that is appropriate for all review types.
The amendment is unnecessary, as it appears to apply to all review types, irrespective of the lack of uniform timelines currently applicable under the EU system. For example, it would not be beneficial to UK industry if it is required to wait 12 months before a circumvention review may be carried out. On amendment 56, paragraph 21(4)(b) already allows us to provide in secondary legislation that measures may be extended beyond five years where a review is being undertaken. However, an extension is not appropriate in every type of review—for example, the WTO specifically sets out that duties may not be applied during a new exporter review. Therefore it is more appropriate for this to be provided for in secondary legislation. The development of the review’s framework is still ongoing. It is intended that there will be targeted stakeholder engagement across the UK industry to discuss this issue in more detail, prior to setting out the details of the various review processes in secondary legislation. It is a complicated area, as my explanation of the unintended impact of these amendments shows. I therefore ask the hon. Member to withdraw these amendments.
Anneliese Dodds
I am grateful to the Minister for that explanation. My concern is that the fact that that period is not set within the Bill could lead to a situation where there is no certainty for producers about the length of time during which a remedy would remain in place. I take on board the Minister’s comments. I hoped that they would reduce some of those concerns at least, and I hope that he will accept the concerns we have been suggesting, given that, for certain types of review, other regimes have at least a year’s threshold before decisions can be reconsidered. I am sure the Minister understands that, without having such a set period, we have these concerns. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Anneliese Dodds
I beg to move amendment 57, in schedule 4, page 74, line 1, leave out “request” and insert “consider a request for”.
This amendment provides for the TRA to seek to apply price undertakings in response to a request to do so.
This is a tidying-up amendment. It provides for the TRA to seek to apply price undertakings in response to a request to do so. Our amendment seeks to clarify the precise role of the TRA within the process of application of undertakings. I should mention that this process can be complex and some stakeholders have understandably drawn attention to the problems of ensuring compliance with price undertakings. However, that is not exactly the focus of the amendment. Rather, we are concerned that the Bill seems to suggest that the TRA would be proffering different alternative undertakings.
International practice indicates that authorities arbitrate the different options for undertakings that are presented not by the authorities themselves, but by exporters. That is in line with WTO practice. Article VI of the general agreement on tariffs and trade 1994 and the agreement on the implementation of article VI—the “anti-dumping agreement” that we have referred to in Committee—explicitly authorise the imposition of anti-dumping measures by WTO members, as we know. Article 8 of the anti-dumping agreement includes the set of rules governing undertakings. It refers to the offering and acceptance of undertakings from any exporter—not by authorities themselves—to revise their prices or cease exports at dumped prices. The action is from the exporter, not from the authority.
However, the language in schedule 4 gives the active role to the TRA, referring to regulations giving the authority the ability to request an undertaking. From what I can see, this contradicts the language earlier in part 5 of the schedule that rightly refers to overseas exporters and relevant foreign Governments rather than the TRA offering undertakings. Our amendment would offer a helpful clarification about the role of the TRA, and help to prevent confusion. I hope the Minister will take this in the constructive way in which it is intended.
Graham Stuart
The amendment would mean that the use of undertakings would rely solely on an undertaking being offered by an exporter or a foreign authority, and would deny the TRA the ability to prompt the offering of an undertaking, as the hon. Lady set out in her speech. Our aim is to provide the TRA with the full suite of tools available under the WTO agreements. We must ensure that the TRA is equipped to deal with every possible future scenario.
The Government understand industry’s concern that it is more common practice—the hon. Lady rightly laid this out and is right to probe—for a foreign authority or an exporter to offer an undertaking than to be prompted into giving one by request. None the less, this power to request undertakings is not unusual, as it is set out in a WTO agreement, and adopted in EU regulations. This power is required to cater for certain situations that may arise. For example, the TRA may need to request an undertaking following a review where the level of undertaking needs to be varied, or where the UK is committed to seeking constructive remedies with a trading partner as part of a trade agreement. Therefore, removing this power would serve to undermine the TRA and the discharge of its functions, which I know is the exact opposite of what the hon. Lady would wish.
We would expect that the TRA will exercise this power only where necessary, which we envisage to be rarely. The secondary legislation under this power will outline these circumstances, and we will engage with stakeholders as we develop proposals going further. I hope that, by doing so, we will be able to answer any remaining concerns the hon. Lady has.
It is also worth stating that, as per the WTO agreements, following a request from the TRA, there will be no obligation for an exporter or a foreign authority to enter into such an undertaking that will further limit the power. Once a request has been made, and if an undertaking is subsequently offered, the TRA will still need to conduct an assessment of the undertaking and its terms and conditions to decide whether accepting it would be appropriate and whether it would be in the UK’s economic interest. The fact that the TRA requested the undertaking in the first place will not predetermine this assessment in any way. For these reasons, I ask the hon. Lady to consider withdrawing the amendment.
Anneliese Dodds
I beg to ask leave that the amendment be withdrawn.
Amendment, by leave, withdrawn.
Question proposed, That the schedule be the Fourth schedule to the Bill.
The Chair
With this we will consider:
New clause 15—Review of transitional measures—
“(1) Within three months of the passing of this Act, the Secretary of State shall undertake a review of the advantages and disadvantages of making provision under section 51(1) to secure that transitional measures are applicable on the same day that the tariff provided for in section 8 first has effect.
(2) For the purposes of this section, “transitional measures” are those anti-dumping duties, or anti-subsidy duties, or undertakings, as the case may be, that were applicable in the European Union on the day preceding the day referred to in sub-paragraph (1) to which subsection (3) does not apply.
(3) This subsection applies to any goods in respect of which the TRA has made a recommendation, prior to the date referred to in subsection (2), that injury to a UK industry in the goods would not be likely to occur if a transitional measure were not applied.
(4) The Secretary of State shall, as soon as reasonably practicable after the completion of the review under this section, lay a report of the review before the House of Commons.”
This new clause provides for a review of the case for the continued effect of EU trade remedies after introduction of the new standard import tariff and pending full implementation of the new arrangements under Schedule 4.
Graham Stuart
We have had a useful and interesting discussion about many of the elements in schedule 4. As I have said, the trade remedy system that we operate when we leave the EU will be fully compliant with our WTO obligations. The WTO agreements on anti-dumping, subsidy and countervailing measures set out the requirements that all members must meet to be able to impose either anti-dumping or countervailing measures. This schedule enshrines the key principles of both agreements into UK law. Further detail will be set out in secondary legislation.
I have already explained that this will be technical in nature. Indeed, amendment 25 is a good indication of the level, and amount of detail, that will need to be included, and it would not be appropriate for this to be in the Bill.
Schedule 4, therefore, provides power to the Secretary of State to set out in secondary legislation detailed provisions regarding how to establish dumping, subsidisation, injury and how to calculate those. The schedule includes technical provisions regarding the thresholds that must be met before the TRA may initiate an investigation, including the WTO criteria of what constitutes negligible and minimal. The Secretary of State can also set out detailed provisions about the conduct of investigations, including the information that is required, and of oral hearings; about the different types of reviews the TRA may undertake and their conduct and potential outcomes; about undertakings; about the suspension of measures where market conditions have temporarily changed; and about when and how particular measures may be reviewed and appealed. They are technical, as I said.
It is necessary to set all that out in secondary legislation so that the system is flexible enough to adapt should WTO case law or international best practice move on. I reassure hon. Members that the system will be fully WTO compliant. We will continue to engage with stakeholders as it is developed.
Graham Stuart
The hon. Gentleman is precisely right. As ever, he represents the steel interests in his constituency with assiduity, hard work and focus. He is right to say that we must ensure that measures in place to protect British industry continue smoothly after we depart the EU. That is exactly what the Government intend.
The Trade Remedies Authority will have the important role of reviewing the maintained measures so that they reflect the UK domestic market. The precise timing of reviews being carried out will depend on the terms of any agreement with the European Commission about an implementation period and on the outcome of the call for evidence, which will confirm the number and type of measures that will be maintained.
If the aim is to look again at the general policy to transition the existing EU measures that matter to the UK, that does not need to be revisited. If we take no action to maintain those measures when we leave the EU, they will no longer apply to products arriving into the UK with immediate effect. That would leave important UK industries, including the steel, ceramics and chemicals sectors, vulnerable to dumped and subsidised imports. A review of the policy approach would create uncertainty for UK industry as to whether measures will be maintained. Stakeholders have been clear that it is vital to transition existing measures to maintain protection against injury from dumping.
To return to schedule 4, having an effective trade remedies system in place is crucial to protect our industries from unfair trading practices that cause injury. It is vital to the UK’s interests that the system is transparent, balanced, impartial, efficient and works for the UK as a whole. The system proposed by this schedule and the secondary legislation that will be made under it achieves that, and is the best way to protect UK industries when we are outside the EU. I will respond to new clause 15 when I have heard the arguments made for it by hon. Members.
Peter Dowd
I started to listen to the Minister out of a morbid sense of curiosity, but he became far more plausible as time went on. Do I smell a rat? No, I do not at the moment, but there is some concern. The new clause provides for a review of the case for the continued effect on the UK of EU trade remedies after the introduction of the new standard import tariff, and pending full implementation of the new arrangements under schedule 4. It seeks a review of the case for continued use of EU trade remedies between the UK’s exit from the EU and its negotiation of a new relationship.
I am conscious of the statements made yesterday by Michel Barnier. I do not want to poke into that issue—I think hon. Members will be grateful for that olive branch—but there are wider concerns about which EU regulations and rules the UK will follow in the transition period. Will we continue to be a member of the EU in all but name, or will Ministers seek to pick and choose? I will have to look at Hansard, but I got the impression from the reply given to my hon. Friend the Member for Scunthorpe that, unless there are egregious breaches, we will remain for all intents and purposes virtually as we are, which is quite helpful.
Naturally, the outstanding questions about transitional measures are causing great confusion and concern among UK manufacturers currently protected by EU trade remedies. I take some comfort from the Minister’s reassurances, but in evidence to the Committee last week, UK Steel, the British Ceramic Confederation and the Chemical Industries Association were all less than convinced about the Government’s intentions. They all made the case that the trade remedies outlined in schedules 4 and 5 are not only weaker than those currently in place in the EU, but in some instances worse than those used by other WTO countries. It will be important to tease that out a little more in due course.
New clause 15 would require the Government to undertake a review of the advantages and disadvantages of the new trade remedies outlined in schedules 4 and 5. The reality is that such a review may relate to issues of policy or of practice. I am quite flexible about that, as I am sure the Government are—let us have a look at both, if need be, on a case-by-case basis.
Outlining the potential benefits to UK manufacturers of continuing to use EU trade remedies throughout the transition is also crucial. The new clause should not be too controversial, because if the new trade remedies are as robust and thorough as the Minister suggests, a review will show that. However, if the review showed the new trade remedies to be inferior to the current EU measures, that would not be good news. It would clearly show that the Government were content with laxer trade remedies and were not on the side of UK manufacturers, which are some of the largest employers in the country.
I have a number of questions for the Minister about transitional measures. Can he offer assurances to UK manufacturers that the Government will honour the trade remedies currently in place for the UK? He appears to have indicated that—I think that is what he said—but I do not want to put words in his mouth, so I would like to tease that out a little more. Will the Government consider extending the current trade remedies where necessary?
Does the Minister accept that the trade remedies framework outlined in the Bill may not be up and running by the time Britain leaves the European Union? How confident is he that UK manufacturing will be sufficiently protected from state-sponsored dumping throughout the transition period? Have the Government set a date for members of the Trade Remedies Authority to be selected and a date for the TRA to be fully functional? I think the Bill implies that UK trade remedies will apply during the transition period, but how does that fit with the tone of the statement made by Mr Barnier?
It is clear that the Government have huge questions to answer about the effectiveness of the trade remedies in the Bill, and about how they will work throughout the transition period. The devil is in the detail, so I hope that the Government have listened carefully and will try to answer our concerns and those of many people out there.
Question put and agreed to.
Schedule 4 accordingly agreed to.
Schedule 5
Increase in imports causing serious injury to UK producers
Jonathan Reynolds
I beg to move amendment 65, in schedule 5, page 81, line 31, leave out from “application” to end of line 32
This amendment removes the requirement for a preliminary adjustment plan.
The Chair
With this it will be convenient to discuss the following:
Amendment 66, in schedule 5, page 81, line 44, leave out sub-paragraph (3)
This amendment is consequential on Amendment 65.
Amendment 67, in schedule 5, page 82, line 14, leave out paragraph (e)
This amendment is consequential on Amendment 65.
Amendment 68, in schedule 5, page 82, line 21, leave out “(d)” and insert “(c)”
This amendment is consequential on Amendment 65.
Amendment 69, in schedule 5, page 82, line 26, leave out “(d)” and insert “(c)”
This amendment is consequential on Amendment 65.
Amendment 72, in schedule 5, page 86, line 29, leave out from “21)” to end of line 34
This amendment removes the requirement for an adjustment plan to be in place prior to TRA making a recommendation under paragraph 14.
Amendment 73, in schedule 5, page 91, line 8, leave out paragraph (d)
This amendment is consequential upon the removal of reference to an adjustment plan in Amendment 72.
Jonathan Reynolds
Amendments 65 to 69 and amendments 72 and 73 have been grouped together as they all refer to the removal of the preliminary requirement for adjustment plans. It states in the Bill that the Trade Remedies Authority may only make a recommendation if it is satisfied that there is an adjustment plan in place setting out how the UK producers of the relevant goods intend to adjust to the increased importation of goods affecting their industry. In addition, it stipulates that the TRA may only initiate a safeguarding investigation in relation to goods where the application for it is accompanied by a preliminary adjustment plan. As is explained in the Bill’s explanatory notes, this is to ensure that producers have a plan to improve their competitiveness alongside any measures which may be imposed, so that measures are not only a temporary solution.
The amendments tabled by the Opposition would remove the need for such adjustment requirements. The reasons behind this are numerous. It seems counter-intuitive to make it incumbent on industries to draw up their own adjustment plans. Surely if an application is being made to the TRA then this is already a measure of last resort for an industry. It may also provide an easy exit for the TRA to avoid opening an investigation if it is perhaps resource-constrained, by pointing instead to the measures that the producer has drawn up as an alternative to remedies being imposed. Equally, given that time is of the essence—that seems to be a point of agreement between both sides of the House—mandating producers to include adjustment plans before a recommendation can be made risks adding a delay to a process that is already time-sensitive.
Kathleen Walker-Shaw of the GMB, who gave evidence to the Committee on 23 January, said that she was
“extremely alarmed by how weak the remedies were in terms of anti-dumping cases.”
She pointed out specifically that they
“are very data, document and resource-heavy cases to bring forward.”
It therefore makes little sense for us to add to that burden by putting another barrier in place for UK industry to jump over right at the outset by drafting an adjustment plan.
This is not simply the view of the Opposition. Representatives of industry have also argued that these requirements are likely to be problematic. The Manufacturing Trade Remedies Alliance has explained that there is absolutely no requirement in the WTO agreement for an adjustment plan at any of these early stages, either prior to an investigation being opened or when measures are being considered for extension. As the MTRA highlights, the only stipulation from the WTO is that there must be evidence of the industry adjusting if the relief is to be extended beyond four years, and they point out that the EU follows the same approach.
The Manufacturing Trade Remedies Alliance also believes that the requirements as laid out in the Bill are disproportionate, and conflict with the provision allowing safeguarding measures to be entered into in the case of a threat of serious injury. It also highlights the risk that these measures could reduce the Government’s options for tackling aggressive trade protectionism by foreign countries. It notes that the EU has in the past introduced safeguard measures to temporarily protect the steel industry from the side effects of WTO-incompatible tariffs imposed by the US pending resolution of the dispute.
It is surprising that—for a Bill which is so light on detail—this is the one area in which the Government have decided to provide some certainty that flies in the face of expert advice to the contrary. Given the historical context and the anxieties of UK industry, these concerns are understandable. All members of the Committee will be familiar with the implications of what will happen if we do not get this right, as was illustrated catastrophically by the impact of cheap Chinese steel imports.
It is important that the Government give confidence to the UK industry at this stage that they are not anti-protection in principle. This amendment would demonstrate that the Trade Remedies Authority is supportive of this notion, and would streamline the process towards remedies where they are necessary. It would not preclude the development of an adjustment plan on a longer term basis by the industry or producer in question, but would simply prevent a more restrictive process being in place that is out of step with the one being followed by our global partners.
I conclude by returning to Kathleen Walker-Shaw’s testimony of 23 January on those anti-dumping rules. She said,
“I just feel that the provisions in the Bill do not fulfil the promise we were given that British jobs, British industry and the British economy would thrive post-Brexit.”—[Official Report, 23 January 2018; Vol. 635, c. 36, Q43.]
This Committee is now in its third day of investigating ways to try and do this, and can get us closer to that outcome.
Graham Stuart
The hon. Gentleman keeps referring to and giving evidence of anti-dumping. These amendments affect adjustment plans that apply to safeguards—so not anti-dumping.
Jonathan Reynolds
I said in my introduction that this is about the hoops that have to be jumped through before the Trade Remedies Authority can take action. As I was just coming to my conclusion, I now appeal to the Minister for greater certainty for industry and greater authority so that they can plan for going forward, by adding more clarity at this stage and not introducing things that are not replicated in our closest trading partners.
Graham Stuart
The amendment would provide that in safeguard investigations UK complainant producers are not required to provide adjustment plans outlining the steps they intend to take to adjust to increased imports in their market. That would be out of step with our objective to create a balanced and proportionate trade remedies system for the UK. It is noticeable that the only detail given in the hon. Gentleman’s presentation was not do with safeguards, but with anti-dumping. It was not clear from his response whether that was due to confusion or because there simply was not enough information to back up what he was saying about safeguards.
There are many benefits to requiring adjustment plans and the need to promote adjustment is implicit in the WTO agreement. Adjustment plans serve to reinforce the rationale for applying safeguard measures and ensure that measures are used fairly. Unlike anti-dumping and countervailing measures, safeguards relate to perfectly fair trade and apply globally. Therefore it is especially important that those measures balance the interests of producers and downstream consumer industries. Having listened to the speech just given, one would be forgiven for thinking that those issues were not true.
Having a plan for adjustment helps to ensure that measures protect producers from injury, while giving them time to adjust to increased imports. It provides precisely the certainty which, in his peroration, the hon. Gentleman called for. However, though we have put that on the face of the Bill, because of the nature of safeguards —which have got nothing to do with dumping—we have a peroration that asks why we do not provide certainty. It is exactly the certainty that we need to provide. We have spelt it out; we have taken the principle implicit in WTO agreements and put it in the Bill, so that we can improve on existing operations—stick conceptually to the existing rules but do so in a better way, which gives exactly the certainty that the hon. Gentleman talked about wanting to provide.
As so often in our debates in this Committee—which has been a stimulating and fantastic experience so far—amendments tabled by the Opposition have exactly the opposite effect to the ones that they claim. They say they want to do one thing, but when one bothers to read their amendment, look at the Bill and put the two together, one sees that the effect is the exact opposite. It is fascinating to see how, in almost all cases, the Scottish National party supports the Opposition, even when it is clear that the amendments are technically flawed—they do not do what the Opposition think they are doing, let alone achieve the end policy result. Perhaps that is a sad reflection on the state of the Opposition today.
Our intention is not to create additional burdens on business but to ensure a light touch approach which means that industry is able to compete without the need for protection as measures are rolled back. As such, it is undoubtedly in the interests of UK producers to use these plans and to be thinking about adjustment as early as the initiation stage of an investigation. Furthermore, the steps outlined in an adjustment plan provide a useful tool for determining the suitable pace of liberalisation, tailoring measures where appropriate. In drafting our secondary legislation, the Government intend also to build in flexibility to account for scenarios where different levels of detail would be appropriate in the plans.
In terms of whether they would be overly burdensome on business, we will ensure that the process is both flexible and proportionate, in order to serve the needs of business in the most appropriate way possible. It is for those reasons—although I can provide others—that I ask the hon. Gentleman to withdraw the amendment.
Jonathan Reynolds
In my experience as an admirer of the Minister, whenever he gets somewhat tetchy it is perhaps to disguise from the House his own shortcomings. I am not satisfied with his response and nor, I believe, is British industry. Therefore I wish to press the amendment to the vote.
Question put, That the amendment be made.
Anneliese Dodds
I beg to move amendment 74, in schedule 5, page 91, line 9, at end insert—
‘(3A) The TRA shall only recommend extending a safeguarding remedy, whether in the form of a safeguarding amount or a tariff rate quota, beyond the 4 year period referred to in paragraph 15(2)(b) if it is satisfied that there is evidence that the UK producers are adjusting to the importation of the goods in increased quantities.
(3B) The total duration of a safeguarding remedy after any such extension shall not exceed 8 years.”
This amendment makes provision on the face of the Bill about the extension of a safeguarding remedy.
The Chair
With this, we will consider the question that schedule 5 be the Fifth schedule to the Bill.
Anneliese Dodds
I will not speak on this for long. We have much else to get through this afternoon, and maybe I am about to be surprised, but I anticipate that we may have a similar result to one we just had, particularly given that many of the same issues come up in relation to this amendment as to that just moved by my hon. Friend. It would be interesting if we had a plurality of views; maybe that day will come eventually.
As with many of our other amendments, this amendment clearly aims to increase the predictability for British business in the Bill. In particular, we think it is important to make provision in the Bill about exactly how a safeguarding remedy could be extended, to expand the considerations taken on board in that process.
With this amendment, the TRA would only recommend extending a safeguarding remedy beyond four years if the authority were satisfied that there was evidence that UK producers were adjusting to the importation of the goods in increased quantities—so not a plan, actual evidence of that adjustment would be necessary. The total duration of any such extended remedy would be only be another four years, so eight years in total. As with many other elements of the Bill, more clarity is needed here and our amendment would deal with that deficiency.
Graham Stuart
Schedule 5 sets out the provisions that will apply in cases where UK industry finds itself being harmed by unforeseen surges in imports. The WTO agreement on safeguards set outs the requirements that must be met for the UK, as for other members, to be able to impose safeguard measures. Through this schedule, we are adopting the key principles into UK law and setting out the broad elements of the safeguard process that will be operated by the TRA.
As we have already discussed, there will be a need for more detail. This will, rightly, be set out in secondary legislation. The schedule also provides the necessary powers for the Secretary of State to make regulations to do this, including, for example, to define what is meant by “increased quantities”, “UK producers” and “like goods”. Paragraph 19 of schedule 5 provides that regulations can be made to set out the process for reviewing safeguard measures. The regulations will set out, among other things, the circumstances in which measures can be continued.
Amendment 74 seeks to require UK producers to provide evidence that they are adjusting to increased imports before a safeguard measure can be extended beyond four years. It also aims to add into primary legislation that safeguard remedies may only be in place for a maximum of eight years. As I explained earlier, once we leave the EU, the UK clearly needs to be able to take action where our industry is being harmed by unfair trade from other countries, whether that is by dumped or subsidised goods, or as a result of fairly traded but unforeseen surges in imports. The safeguard provisions set out in schedule 5 achieve this. Unlike anti-dumping and countervailing measures, safeguards relate to fair trade and apply globally. Therefore, it is especially important that these measures balance the interests of producers and downstream consumer industries by facilitating adjustment.
We have already discussed adjustment plans when considering the previous group of amendments. As I said, these are a vital tool in ensuring that safeguard measures not only provide protection, but allow those affected the opportunity to make necessary adjustments. It is not appropriate to introduce a requirement for producers to provide evidence of adjustment when seeking to extend measures beyond four years.
I ask the Committee to consider for a moment that we have measures in place—a safeguard—because of a massive surge on imports. The TRA has done its work. In an entirely novel process—I am aware of no parallel anywhere—Her Majesty’s Opposition, doubtless supported by their allies in the Scottish National party, want to impose a bureaucratic and burdensome measure—[Interruption.] I notice that the SNP Members are shaking their heads. For once, perhaps, they will strike out and not support something that is so clearly damaging to the interests of Scottish producers. Why on earth would the producers have to provide evidence of their adjustment when the main issue should be other aspects and criteria? It is a strange innovation that the Labour party has put forward.
Introducing a requirement for producers to provide evidence of adjustment when seeking to extend beyond four years would undermine the need for flexibility in our approach, which recognises—this is worth reflecting on—that adjustment is not always dependent on a producer’s own efforts. Yet, under the amendment, protection measures would cease if producers were not able to provide evidence that they were adjusting. Adjustment plans are a more suitable way of building in that flexibility and ensuring that there is a commitment to adjustment from as early as the initiation stage. Finally, with regard to the eight-year rule, the Government intend to be WTO-compliant by setting that out in secondary legislation.
Kirsty Blackman
I would appreciate it if the Minister let us know where it says that UK producers are supposed to produce that evidence. My reading is that the TRA has to find the evidence rather than the producers submitting it.
Graham Stuart
The hon. Lady will find that the evidence of adjustment by UK producers is unlikely to be provided by anyone other than UK producers. It is a rather strange innovation to insert that into legislation for the continuation of measures that are put in place because of the injury caused and the massive surge on imports. It is an entirely novel concept. I am not aware of its being anywhere in WTO schedules although, admittedly, after so little time in the job I cannot claim to know them inside out. If any Member of the Opposition, who after all came up with the extraordinary innovation, has evidence of a basis in WTO law or anywhere else, I would be fascinated to hear it. Perhaps the hon. Lady will support the amendment anyway, even though there is no evidence for it, legally or otherwise but I hope that she, like me, will oppose the amendment if it is pressed to a vote.
Anneliese Dodds
I am pleased to hear the Minister accept our call to ensure that the total duration of any such extended remedy shall be for another four years—eight years in total. He seemed to suggest that that would be forthcoming in secondary legislation. We are pleased to hear that, although it is unfortunate that it is not clear in the Bill.
On the evidence, much of our concern behind the amendment is motivated by the burden on the affected industry. That was set out clearly in remarks on a previous Opposition amendment. I hope, Mrs Main, that you will not see this as facetious: talking about novelty, we learned this morning that the market share threshold before an investigation can be initiated appears to be novel in the world, and the Minister said it was a wonderful innovation on the part of the British Government, so perhaps he can also sometimes see innovation when it comes from the Opposition.
Question put, That the amendment be made.
Kirsty Blackman
I beg to move amendment 110, in clause 14, page 9, line 45, at end insert
“following consultation with relevant stakeholders including consumer representatives and agricultural producers.”
This amendment requires consultation before the making of regulations to increase the customs tariff for agricultural goods.
The Chair
With this it will be convenient to discuss the following:
Clause 14 stand part.
New clause 6—Additional import duty on agricultural goods: enhanced parliamentary procedure—
“(1) No regulations may be made by the Treasury in exercise of the power in section 14(1) except in accordance with the steps set out in this section.
(2) The first step is that a Minister of the Crown must lay before the House of Commons—
(a) a statement of the reasons for proposing to make the regulations; and
(b) a draft of the regulations that it is proposed be made.
(3) The second step is that a Minister of the Crown must make a motion for a resolution in the House of Commons setting out, in respect of proposed regulations of which a draft has been laid in accordance with subsection (2)(b)—
(a) the proposed additional amount of import duty; and
(b) the proposed period for the purposes of section 14(1)(a);
(c) the proposed trigger price for the purposes of section 14(1)(b).
(4) The third step is that the House of Commons passes a resolution arising from the motion made in the form specified in subsection (3) (whether in the form of that motion or as amended).
(5) The fourth step is that the regulations that may then be made must, in respect of any matters specified in subsection (3), give effect to the terms of the resolution referred to in subsection (4).”
This new clause establishes a system of enhanced parliamentary procedure for regulations setting additional import duty on agricultural goods, with a requirement for the House of Commons to pass an amendable resolution authorising the rate of import duty on particular goods and the relevant conditions.
Kirsty Blackman
I rise to move amendment 110, but I will mention now that if new clause 6 is moved at the appropriate stage, we will support it, because an enhanced parliamentary procedure seems sensible.
Clause 14 is headed “Increases in imports or changes in price of agricultural goods” and deals specifically with special agricultural safeguards and what can be put in place in relation to them. Our amendment is a very short one, but it is designed to require that the Secretary of State consult with consumer representatives and agricultural producers when making any decisions relating to special agricultural safeguards.
The Minister, when he spoke earlier about safeguarding, said that the decisions taken are about balancing the needs of producers with those of downstream consumers. This is exactly the kind of thing we are trying to do: we are trying to ensure that the Secretary of State, when making the recommendation to the Treasury to exercise the regulations, is doing so after consulting both consumer groups and agricultural producers. That is the only sensible thing to do in this case. The Minister has previously been clear that the Government like consulting with people and tend to try to do so wherever they can, but it would be sensible if it were stated in the Bill that they were required to do so in advance of putting in place, via a relatively unusual process, relatively unusual measures that would have an impact on our agricultural producers and consumers.
That is important because Brexit is looming on the horizon and our farmers do not know how they will be supported financially after 2020. I think Ministers have given undertakings to safeguard the money that comes from the EU until that point, and farmers have no certainty beyond that period of time. The UK Government are looking to make their own trade deals, which may change the agricultural landscape in the UK or result in our taking imports we have not previously because because of the trade deals as part of the EU—we have previously discussed things such as chlorinated chicken. Given all the changes on the horizon, both for agricultural producers and for consumers, who are already finding, for example, that the price of butter is going through the roof because of the increase in sterling, it is difficult for the Government to foresee what may happen in the future. If the Government are going to put in any measures related to increasing imports or the price of agricultural goods, particularly through the safeguarding measures, it would be sensible to consult both agricultural producers and consumers in advance of putting those in place.
Peter Dowd
The Minister was getting a little bit tetchy and prickly there. There is a quote from “Henry VIII” which, given that we are talking about Henry VIII powers, seems appropriate today:
“Be advised:
Heat not a furnace for your foe so hot
That it do singe yourself.”
The new clause would establish an enhanced parliamentary procedure in relation to import duties on agricultural goods. During our sittings, the Committee has heard serious concerns expressed by multiple witnesses about the democratic shortcomings of the Bill. The Bill is, first, strikingly light on detail, notwithstanding the Minister’s assurances that things will be put into place and more detail will come in due course. The Government are pushing that detail on to secondary legislation, but the delegated legislation process was designed to make administrative changes to laws—in effect, a rubber-stamping process—not for items that will form the material basis of our trade defence policies and so require proper scrutiny and debate. More worrying are the items to be channelled directly through the Executive in an unacceptable concentration of power, which ought to be subject to scrutiny, with Parliament given a say in holding the Government to account. The amendment is one of several in which the Opposition are calling on the Government to put critical decisions on tariffs, quotas and preferential rates in front of Parliament.
The measures in the Bill are at odds with the greater democratic control persistently promised to voters. Bringing back control, as we have said a million and one times, is about bringing back control to Parliament, not to a cadre of Ministers sitting in their offices in Whitehall. The new clause sets out four steps to enhance parliamentary scrutiny: first, a Minister must come to Parliament to explain the intentions of the draft regulations; secondly, a Minister must tell Parliament the import duty amount, as well as the period and trigger price under the relevant section; thirdly, the House must pass a resolution arising from the Minister’s motion; and, fourthly, regulations must be made to give effect to that resolution—all in the cold light of parliamentary scrutiny and sight. It is not for the Government to make decisions single-handedly behind closed doors, nor for the Secretary of State to steer the process unilaterally. Rather, such decisions must be subject to proper democratic accountability, with the essential checks and balances enshrined in law.
As I have said before, the Opposition recognise that the Government must make necessary preparations to create the UK customs and tariff regime post-Brexit, but they cannot have carte blanche. We should not allow, or be considering, a carte blanche process allowing the Government to concentrate all those new powers in the Executive. The Opposition’s view is that in this instance the interpretation of taking back control— moving it from Brussels to the Executive—is not acceptable. That is not only true of the provision before us today, but evident in the European Union (Withdrawal) Bill and the Trade Bill. The Government are attempting to sidestep parliamentary scrutiny, and that is not acceptable.
In our view, tariffs should undergo the same parliamentary process as taxation, with similar levels of parliamentary scrutiny. We will oppose the Government’s attempts to give the Treasury delegated powers to set future customs duties and tariffs away from the public and parliamentary eye. That is not the way we do things in Britain. New clause 6 outlines an enhanced parliamentary procedure for setting additional import duty on agricultural goods, among others, to bring scrutiny to our customs policy.
Our agricultural sector faces an uncertain future with Brexit ahead. It is distinct from other UK industries in possessing a more interwoven relationship with the European Union, given the existence of the common agricultural policy, which provides subsidies to UK farmers that the Government have indicated they will continue. The common agricultural policy provides critical support to UK farming—for example, the Department for Environment, Food and Rural Affairs estimated in 2014 that such payments represented 55% of farm income. As I said, the Government have promised to maintain those subsidies at the existing level until 2022, which I am sure is a huge comfort to the agricultural sector, but there are no guarantees yet on what will occur after a transitional period. Our step-by-step proposed parliamentary process will hold the Government to account for their policies and import duty proposals on agricultural goods.
Given the reliance in some quarters on subsidies and the fact that our EU counterparts will continue to be in receipt of subsidies across the continent, there will be a number of factors to consider when the UK comes to setting tariffs on agricultural imports. It is worth noting that the value of UK agricultural production at market prices was £25.8 billion in 2014, according to official Government statistics, and the farming sector provides 400,000 jobs in the UK. I accept that not many of them are in the constituency of Bootle, but there we are.
As the National Farmers Union has highlighted, the UK trade balance is negative to the tune of £22.4 billion, which makes the UK a net importer of food. Although there is an ambition for that figure to improve as the UK becomes more self-sufficient in food production, it shows that the UK is quite heavily exposed in terms of import dependency. As the NFU also highlights, the UK will be duty-bound to establish its own set of schedules with the World Trade Organisation, once we leave the EU. Although we know the Government have announced their intention to replicate the existing trade regime as far as possible in those new schedules aligned with existing arrangements, we have no guarantees on that front, and that must also be agreed by the other members of the WTO. Given the broad range of potential outcomes here and the importance of the agricultural sector to the UK economy, it is vital that any decisions made on import tariffs are subject to proper scrutiny and debate.
The amendment proposes that the relevant Minister must lay before the House of Commons full statements and drafts of regulations so that they can be properly scrutinised by Members from around the country who can represent the diverse interests of the agricultural community—the producers—and British consumers. It is almost a binary position.
Julian Sturdy (York Outer) (Con)
I draw the Committee’s attention to my entry in the Register of Members’ Financial Interests. I wonder whether the hon. Gentleman should also touch on the impact of standards. He talked about animal welfare standards, as well as genetically modified products that we do not have in the European Union and a number of pesticides that are not now used in Europe but are used around the world. Those issues will all have an impact on future trade deals on food and agriculture, and will affect the consumer.
Peter Dowd
I thank the hon. Gentleman for raising that point, which is very important. I know one of my colleagues will be moving an amendment on those issues, and I hope that at that point the hon. Gentleman will be able to join the debate in a little more detail and give his knowledge and expertise on the matter.
I call on members of the Committee to lend their support to the amendment to ensure that democratic safeguards are in place surrounding the future of the UK’s agricultural industry.
The Financial Secretary to the Treasury (Mel Stride)
It is a pleasure to serve under your chairmanship, Mrs Main. I begin by thanking the Under-Secretary of State for International Trade, my hon. Friend the Member for Beverley and Holderness, for his spirited Henry VIII- style performance. We are now back to Mr Nice. [Laughter.] I feel bound to inform Members opposite that, although I may take a more gentle route, I will probably arrive at the same destination as my colleague would lead us to.
Clause 14 sets out the necessary provisions required to establish the UK’s independent agricultural safeguards regime. It enables the UK to mirror existing EU arrangements for agricultural standards post-EU exit. In addition to the range of tariff and quota regimes that currently govern imports into the UK, some agricultural imports are governed by special agricultural safeguards. Agricultural safeguards are contingency restrictions on agricultural imports. They permit additional duty to be applied on certain agricultural imports in special circumstances—for instance, if there is a surge in the volume of imports or a sharp fall in import prices that could have an adverse impact on the UK market. The use of agricultural safeguards is permitted under the WTO agreement on agriculture. They can be applied only to goods in the scope of this agreement, but they are specifically designated in a WTO member’s schedule of commitments.
Julian Sturdy
For my clarification, is the Minister saying the UK Government can act much quicker if there is a disease outbreak in a country from which we import food or meat products that would ultimately affect UK agriculture and the UK consumer?
Mel Stride
My hon. Friend is probably raising an issue that would be outside the context of the agricultural safeguarding regime. The regime relates to sudden drops in the price of goods, and indeed certain increases in the volume of goods that are being imported, as opposed to the kind of issues he raises. Phytosanitary issues are outside the context of the Bill but will be subject to the kind of negotiations and measures that we bring into effect in that particular regard.
The Bill introduces a comprehensive framework for a new stand-alone customs regime, which will be underpinned by detailed and technical secondary legislation. The Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate, taking into account the technical detail of the regulations and how quickly they need to be changed.
As I set out in addressing amendment 110, the effectiveness of the agricultural safeguards regime relies on its responsiveness. The proposed additional procedure would give rise to unacceptable delays, which would not allow the Government to respond quickly to changes in circumstances or to update the measures in a timely manner. The power in the clause is subject to the negative procedure. Given the technical nature and frequency of changes, the Government consider that appropriate and proportionate. I hope the Committee will agree that the clause should stand part of the Bill.
Kirsty Blackman
The Minister made a relatively good point in relation to how many technical changes there may be. I will look into the frequency at which changes are likely to occur. If they will be frequent, I will not bring this matter back on Report, but if they will be infrequent, I will consider tabling an amendment. At this stage, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 14 ordered to stand part of the Bill.
Clause 15
International disputes etc
Kirsty Blackman
I beg to move amendment 111, in clause 15, page 10, line 18, at end insert—
‘(3) Within three months of the passing of this Act, the Secretary of State must make regulations defining “international law” for the purposes of this section.’.
This amendment requires the Government to define international law for the purposes of Clause 15.
The Chair
With this it will be convenient to discuss the following:
Amendment 112, in clause 15, page 10, line 18, at end insert—
‘(3) In this section, “international law” means—
(a) World Trade Organisation treaties,
(b) rules of international public law explicitly referred to in World Treaty Organisation treaty provisions,
and shall be interpreted in accordance with the customary rules of interpretation of international public law.’.
This amendment defines international law for the purposes of Clause 15.
Amendment 113, in clause 15, page 10, line 18, at end insert—
‘(3) Within three months of the passing of this Act, the Secretary of State must lay before the House of Commons a report on—
(a) the relevant international law authorising the exercise of the powers, and
(b) the circumstances in which the Government considers it appropriate to deal with a dispute by varying the amount of import duty payable.’.
This amendment requires the Government to report prior to implementation on its interpretation of relevant international law and its expectations about the circumstances of a trade dispute or issue giving rise to a variation in tariffs.
Amendment 114, in clause 15, page 10, line 18, at end insert—
‘(3) The Secretary of State must lay before the House of Commons an annual report on the exercise of the powers under this section including information on—
(a) the relevant international law authorising the exercise of the powers in each case, and
(b) the matters in dispute or issues arising in each case.’.
This amendment requires the Government to report on the circumstances of, and international law basis for, each variation of tariffs as a result of a trade dispute.
Clause stand part.
New clause 7—Variation of import duty in consequence of international dispute: enhanced parliamentary procedure—
‘(1) No regulations may be made by the Secretary of State in exercise of the power in section 15(1) except in accordance with the steps set out in this section.
(2) The first step is that the Secretary of State must lay before the House of Commons—
(a) a statement of the dispute or other issue that has arisen;
(b) an account of the reasons why the Secretary of State considers that the condition in section 15(1)(b) has been met; and
(c) a draft of the regulations that it is proposed be made.
(3) The second step is that a Minister of the Crown must make a motion for a resolution in the House of Commons setting out, in respect of proposed regulations of which a draft has been laid in accordance with subsection (2)(c) the proposed variation of import duty.
(4) The third step is that the House of Commons passes a resolution arising from the motion made in the form specified in subsection (3) (whether in the form of that motion or as amended).
(5) The fourth step is that the regulations that may then be made must, in respect of any matters specified in subsection (3), give effect to the terms of the resolution referred to in subsection (4).’.
This new clause establishes a system of enhanced parliamentary procedure for regulations varying import duty as a result of an international dispute, with a requirement for the House of Commons to pass an amendable resolution authorising the variation in the rate of import duty.
Kirsty Blackman
I rise to speak to amendments 111 to 114 in my name and that of my hon. Friend the Member for Dunfermline and West Fife. I am aware this is a framework Bill, but the clause is particularly short and skeletal. It would have benefited from being a bit longer and fleshed out just slightly, because then the Government could have explained more adequately what they are talking about.
Amendment 111 deals with an issue raised with us by the Law Society of Scotland, which said:
“Clause 15(1)(b) makes reference to international law but it is not clear what is meant by this. It would be helpful were the Minister to explain precisely the circumstances in which the Government would need to deal with a dispute by varying the import duty.”
If would be useful if the Minister, either in summing up or at a later point, could provide a bit of clarity. Amendment 111 would ask the Secretary of State to come back with regulations defining what “international law” is for the purposes of the clause. As has been stated, if the Law Society of Scotland does not think that is clear, perhaps it needs a bit more fleshing out.
Amendment 112 suggests to the Minister what he might mean by “international law.” We tabled the amendment to see if that is what the Government mean. If they do, perhaps they will accept it.
Amendment 113 attempts to do something similar, but we are giving the Government a little more time in which to define what they mean by “international law” in the clause. We ask them to come back within three months of the passing of the Bill, making clear what the relevant international law authorising the exercise of powers would be and the circumstances in which they consider it appropriate to deal with a dispute by varying the amount of import duty. It may be that the Government intend to return to that later anyway but, if they were to accept any of the amendments, they will make their intentions clear at this point.
Amendment 114 has a slightly different purpose: to increase the accountability of Government. The Government have the power on international disputes and the Secretary of State will make regulations in relation to that through the clause, but there does not seem to be any accountability to Parliament about regulations or changes, or ways in which they will deal with international disputes. There seems to be no feedback mechanism to allow Parliament to ensure that the Minister makes the correct decisions or to scrutinise those decisions adequately.
In amendment 114, we have asked the Secretary of State to lay before the House of Commons an annual report on the exercise of these powers, making clear the circumstances in which they have used them, which matters were in dispute and which was the relevant international law in deciding the changes.
Now may not be the time to say this, but I will just make my intentions clear. Depending on what the Minister says about his intentions, it may be that we do not need to press amendments 111 to 113. I would very much like to press amendment 114 when we come to that stage, but on the other three I will wait to see what the Minister says.
Graham Stuart
I will endeavour to follow the good example set by the ever-affable hon. Member for Bootle, who gave not only good content, but brilliant quotes that entirely encapsulated the moment and which we all enjoyed.
Clause 15 enables the Secretary of State to vary the rate of import duty when a dispute or other issue has arisen between the UK Government and the Government of another country, and the UK is authorised to do so under international law. The clause replaces equivalent existing powers available to the European Commission. Under the WTO dispute system, WTO members that have been found to be in breach of their obligations must bring their measures into compliance with WTO law. If they do not do so within a reasonable period, the parties can attempt to agree on compensation. Compensation may take the form of a reduction in the import duty on specified goods from the complaining country, although in practice any such reduction would have to be applied equally to all other WTO members in accordance with the most favoured nation rule.
If the parties fail to agree compensation, the complaining member or members may impose retaliatory measures against the member found to be in breach. Such measures typically involve raising the rate of import duty on specified goods from that country to incentivise it to bring itself into compliance. Free trade agreements with third countries also frequently contain dispute settlement mechanisms, many of which follow similar procedures to those of the WTO. In particular, free trade agreement dispute settlement mechanisms often result in a signatory being required to bring itself into compliance with the terms of the FTA, and often allow retaliatory trade measures to be taken against the offending party if it does not do so, and cannot agree appropriate compensation. Authorisation to implement compensation or retaliation measures may also arise in a number of other specific contexts. For example, a WTO member that imposes a temporary safeguard measure to protect its industry, or that modifies its WTO schedules, must seek to compensate any affected countries, failing which retaliatory measures may be imposed against it.
The ability to vary the rate of import duty in response to disputes and other contentious situations is vital to ensure that the UK can operate an independent trade policy after leaving the EU. In particular, the threat of imposing retaliatory duties following a trade dispute can be an effective means of incentivising other countries to comply with their obligations under international law, and can therefore help to preserve and open up trading opportunities for UK firms.
The European Commission is currently responsible for conducting trade disputes and applying enforcement measures on behalf of the UK. Once we leave the EU, the UK will bring and defend trade disputes in its own right. When such disputes are decided, we will require the powers to be able to take action to enforce and respond to their rulings including, where necessary, varying the rate of import duty. The power in the clause ensures that the UK can do just that.
Amendments 111 and 112 seek to provide a legislative definition of international law in the Bill or in regulations to be made by the Secretary of State, as the hon. Lady set out. Amendments 113 and 114 seek to impose a statutory duty on the Secretary of State to report to the House of Commons on that power, either within three months of the passing of the Bill or annually, providing details of the international legal basis for justifying the use of the power.
As I have explained, there are a number of situations under international law in which countries may be authorised to vary their rate of import duty for the purposes of retaliation or compensation, including in disputes under different types of international agreements and, just to make it even more complicated, in other contentious situations that do not involve a formal dispute. Given the different context in which clause 15 would apply, it is sensible to refer broadly to authorisation under international law. Adopting a narrower approach would risk constraining future action in situations that are not currently foreseeable.
Kirsty Blackman
I rise to query something the Minister said and to ensure that I heard him correctly. Is it the Government’s intention, at the negative procedure stage, to explain in the explanatory notes the basis in international law and the reason for the measure being introduced?
Graham Stuart
It is our intention that the Government, when they seek to make such a change, and they are doing so under international law, would provide evidence of the law upon which they were relying. If the hon. Lady is happy with that, I will leave it there.
In conclusion, after leaving the EU, the United Kingdom will require the ability to vary the rate of import duty to respond to international dispute rulings and other contentious situations. That will ensure that the Government can continue to protect the UK’s economic interests by putting in place, when necessary, effective retaliatory and compensatory measures against other countries. I commend the clause to the Committee and hope that the amendment is withdrawn or rejected.
Anneliese Dodds
I am grateful to the Minister for his clarifications. I know he will regret hearing this, but the Opposition feel that the procedures are, sadly, not appropriate and proportionate. The new clause argues for an enhanced parliamentary procedure if import duties must be varied as a consequence of an international dispute. I will not go through the more rigorous procedure we suggest; it is similar to that described by my hon. Friend the Member for Bootle.
It would help if the Minister answered this initial question: what is the anticipated frequency of this kind of dispute? My view of what has occurred at EU level is that such disputes are not so frequent that appropriate scrutiny would not be possible. Some of us are concerned that a dispute might come sooner rather than later. I understand that experts took different positions in the International Trade Committee on whether the UK’s continuing to apply EU anti-dumping duties would be legal after it had left the EU. That is one of many reasons why it would be helpful to have more explicit mention in the Bill of existing measures being automatically rolled over. But, anyway, that is a caveat.
There are many other reasons why an enhanced procedure is necessary. The first is that the decisions taken in the context of such a dispute would be adopted by the Secretary of State himself, albeit with the advice of the TRA, and they could have a significant impact on UK industry. We have talked about how, in many cases, the supply chains are complex, and we need to talk about a variety of different consumers and business-to-business activity. It is therefore important that Parliament is able to examine a statement of the dispute and what exactly the Government propose should be done in relation to the dispute, such that the House can vote on that matter if necessary. These disputes do not affect just economic policy; they can have a significant impact on other areas of public policy as well. Therefore, it is important that colleagues are able to express a view on them and to consider the Government’s position on them.
The second reason it is important to have an enhanced procedure is that there is a lot of public concern at the moment about international economic disputes and how they tend to be resolved. I served as a Member of the European Parliament for three years, and I received tens of thousands of communications—about 38,000 at the last count—from concerned citizens about the Transatlantic Trade and Investment Partnership deal between the US and the EU. Most of those emails included criticism of the impact of investor-state dispute settlement, predominantly because that method of resolving disputes is not transparent and many people feel it privileges the voice of companies over Governments. We surely should not be putting ourselves in a position where Parliament’s voice would be not just ignored but not even heard when it comes to our Government’s actions in relation to trade disputes. For that reason, I hope the Government will support our amendment.
I hope that I will be permitted one last question, as this matter came up in the Minister’s opening remarks on the clause. Will he tell us where the Government have explicitly given themselves the power to create WTO schedules? I do not know where that is. He mentioned the necessity of producing those schedules, so can we have some clarification on that point?
Graham Stuart
I will deal with the questions as best I can and in order.
The EU has four retaliatory duties in place. It is not really possible to predict how frequently this power will be used. In some ways the question is not really the frequency but whether, when it does happen, we have a procedure in place to allow us quickly and effectively to take action to ensure that we put the matter right. That, rather than the frequency, might be the bigger issue.
Although we will be seeking, and will be prepared to use, the WTO dispute settlement mechanism as a way of ensuring that there is a level playing field for UK business to compete on, and we will have the tools available for us to participate fully in international trade disputes where necessary, we have no particular appetite to be more litigious than is required to protect the UK’s interests.
I will write to the hon. Lady and the Committee on the WTO schedules and the process attached to that.
Kirsty Blackman
I would appreciate it if the Minister also wrote to me, because I brought that up last week. I am pleased that the hon. Member for Oxford East is pursuing the issue. It is important that the Government have the power to lodge schedules with the WTO and the power to make the technical rectifications that the Minister mentioned—those may or may not end up being technical rectifications to things like quotas, given that some of the countries in the WTO are challenging whether they would be technical rectifications or would constitute modifications.
On our amendments, the Minister has provided some information around how Parliament will be provided with evidence for each of the things that comes up. Therefore, I do not intend to press amendment 111 or amendments 112 and 113, but I do intend to press amendment 114 because I am not yet convinced that the Government will provide enough feedback about how this mechanism is working, and it would be appropriate for them to do so.
Amendment, by leave, withdrawn.
Amendment proposed: 114, in clause 15, page 10, line 18, at end insert—
“(3) The Secretary of State must lay before the House of Commons an annual report on the exercise of the powers under this section including information on—
(a) the relevant international law authorising the exercise of the powers in each case, and
(b) the matters in dispute or issues arising in each case.”
This amendment requires the Government to report on the circumstances of, and international law basis for, each variation of tariffs as a result of a trade dispute.—(Kirsty Blackman.)
Question put, That the amendment be made.
Peter Dowd
I beg to move amendment 126, in clause 19, page 13, line 5, at end insert—
“(6A) No regulations may be made under this section unless a draft has been laid before, and approved by a resolution of, the House of Commons.”
This amendment requires regulations under Clause 19 to be subject to the affirmative procedure.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Amendment 127, in clause 32, page 19, line 32, after “regulations” insert “under section 19 and”.
This amendment is consequential on Amendment 126.
Peter Dowd
We tabled amendment 126, and the consequential amendment 127, to ensure that regulations made under clause 19 are subject to the affirmative procedure.
Clause 19 allows the Treasury to make regulations for full or partial relief from a liability to import duty. The clause sets out a number of factors determining whether a relief can be applied, including the nature or origin of the goods, the purposes for which the goods are imported, the person by whom they are imported and the circumstances under which they are imported. The amendment seeks to provide some parliamentary scrutiny over providing reliefs, which is of course an issue of taxation and would therefore normally be subject to some form of parliamentary oversight.
I have said a great deal about the Bill’s centralisation of powers to the Executive and away from Parliament, and this is yet another example. The Government want their cake and they want to eat it as well. They want to impose taxes with no parliamentary scrutiny, and they want the Bill to be considered a money Bill, thereby avoiding parliamentary scrutiny from the House of Lords. In this particular case, extensive powers are being handed to the Treasury to adjust fiscal policy without reference to Parliament at all. As I have said, that is pretty worrying, and it is a pretty worrying precedent to set as Brexit legislation passes through this place. The Government know what they are doing; otherwise, as I have said, they would not have designated this as a money Bill.
Graham Stuart
The hon. Gentleman has referred to this before, so it is worth correcting it for the record. The Government do not designate Bills as money Bills or otherwise; that is done by Mr Speaker. The hon. Gentleman may blame us for many things, but he cannot blame us for that.
Peter Dowd
On another occasion—perhaps not here—I am more than happy to debate that issue and have that conversation with the Minister. Indeed, if he wants to have that discussion in the Committee, we are more than happy to do so when we debate another amendment. I am sure that he would be delighted with that.
Mel Stride
Clause 19, as the hon. Member for Bootle pointed out, allows for a full and partial relief from import duty. The EU customs regime provides for a relief from import duty on the basis of various factors, including the nature of the goods, their quantity and their value. Those reliefs support trade and address unintended outcomes. They can also be used to address situations in which a change to import duty would have negative consequences, whether for a specific entity or for UK interests as a whole. A relief may relate to a temporary movement, such as a visiting exhibition, or a permanent movement, such as the return of UK materials that were previously exported.
The circumstances in which goods will be eligible for a relief from import duty are carefully defined in EU law. They rely on conditions that ensure that they apply only to achieve the intended outcome. Examples include: where items are imported for scientific, educational or cultural purposes or research; where items are samples, whether for testing or to encourage future trade; where goods are donated or inherited; and where private individuals import goods upon transfer of residence to the United Kingdom due to marriage or for a period of study. The clause also covers goods imported for a specific authorised use that are placed on the home market—aircraft parts, for example, and goods that are temporarily imported, such as those for an art exhibition. Those are dealt with in more detail in the special procedures section.
Reliefs may apply to specific bodies or types of body. For example, reliefs support the operation of organisations such as charities, museums and galleries, as well as private individuals not trading. The changes made by clause 19 will allow the UK to provide full or partial relief from import duty.
Amendments 126 and 127 seek to apply the draft affirmative procedure to regulations made under clause 19. As I have set out and the Committee has had occasion to debate, the Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate. For the powers under clause 19, the negative procedure is both appropriate and proportionate, given the technicality of the regulations and the frequency and speed with which they may need to be made.
The hon. Member for Bootle raised the House of Lords report. The Government are looking at this issue not just in terms of the scope of the matters at hand and the power that is appropriate on that basis, but from a trading and customs point of view. We are considering the frequency with which we are likely to have to make changes and, accordingly, the ways in which the Treasury and Her Majesty’s Revenue and Customs will have to work.
Kirsty Blackman
Clause 19, in effect, gives the Government power to create loopholes—tax reliefs—in the legislation. Given that this is a tax Bill, does the Minister not feel that it would be better for the tax reliefs it creates to be subject to more scrutiny, not less, so that they do not have unintended consequences?
Mel Stride
I would not describe the clause as creating loopholes. It simply allows us, by regulation, to ensure the kind of importations to which I referred earlier. The authorised use importation, for example, relates to goods coming into the country for a specific process before typically being exported out of the United Kingdom. Levying an import duty on such goods would clearly not be appropriate, since they get exported shortly thereafter.
The measures facilitate those particular circumstances, or indeed the loan of an artwork. We are told that the French President is suggesting that the Bayeux tapestry might come over here; that particular gesture would be another example where no import duty would be appropriate, and that particular item should be able to come in and out of the country without being bothered by Customs and Excise. I would argue that the measures are important facilitations rather than loopholes.
Each relief provided for under this power will be for a particular purpose and set out the detailed requirements—for example, in relation to the origin of goods or the purposes for which they are imported. The power will be necessary in the first instance to replicate existing reliefs within the EU, to give certainty to traders directly following our exit from the European Union. However, as circumstances change it may be necessary to adapt our system of reliefs to give UK businesses and individuals the support they need to flourish, and to do so in a timely and flexible manner. For any future reliefs, the Treasury would follow established processes, consulting on draft legislation.
Peter Dowd
The hon. Member for Aberdeen North made some valid points. The reality is that this, to all intents and purposes, is a tax relief. It can be dressed up in whatever way the Minister would like, but it is de facto a tax relief. We already have something like 1,400 tax reliefs, which ordinarily would come to Parliament for their ratification. This seems to be a potential slew of tax reliefs—I will not comment on whether they are good, bad or indifferent—that will be given the imprimatur of a Minister or the Treasury without Parliament having any say whatsoever in that tax raising. That is not a power that Parliament should give away lightly, so I am afraid we cannot accept the Minister’s explanation that these are somehow technicalities and nothing to do with tax and raising money, which is the prerogative of Parliament.
Kirsty Blackman
I am concerned that this is a tax relief, and about the unintended consequences that might flow from it. The Minister almost seemed to say that the Government will make decisions on a case-by-case basis, but that should not be their intention. They should lay out the circumstances in which each kind of widget falls into each category. They are not deciding whether the Bayeux tapestry should be exempt from this duty, but whether artworks should be exempt. Those are pretty significant and major decisions, and I do not think they will be made with the frequency that the Minister suggests.
It might be that in 10 years’ time the world will have changed dramatically and we will be quite a different country, importing things that will need relief in a different way. That is fair enough, but the situation will not require regular change. Given that the measure seeks to encourage industry to flourish and to allow artworks to come to this country to be displayed, it will have a real impact on the UK’s future, so it is completely reasonable to ask the Government to allow more scrutiny. Such instances will not be that frequent, and the measure will have a big impact.
Mel Stride
I point the hon. Member for Aberdeen North to my earlier remarks. We believe that the measure is proportionate, particularly taking into account the frequency of the relevant changes. She is absolutely right about the Bayeux tapestry and the import of artworks; the measure sets the regulations by which those kinds of items will come in and go out of the country. There is no doubt that, in this arena of imports and these kinds of facilitations, changes are certain to occur through time, often of a highly technical nature and on a fairly frequent basis. On that basis, in terms of proportionality, there is a strong argument that we should stick with what is in the Bill.
Question put, That the amendment be made.
Kirsty Blackman
I beg to move amendment 115, in clause 21, page 14, line 15, at end insert—
“(9) Within three months of the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the proposed exercise of the power of the HMRC Commissioners to make regulations under subsection (7), including in particular—
(a) the proposed criteria for appointment of Customs agents, and
(b) the proposed standards which persons must meet to be approved for appointment.”
This amendment requires the Government to report on the proposed use of regulations to prescribe standards for Customs agents.
Kirsty Blackman
This is another amendment to try to get the Government to provide more information on the framework of the Bill. As I have said, I understand that it is a framework Bill, but more information could have been provided, particularly in the context of companies already having to contend with the move from CHIEF to CDS and the massive changes in customs that will be introduced. It would be good for companies to have an understanding—sooner rather than later—of customs agents and the hoops that those agents will need to jump through to be approved.
The amendment asks for the Government to produce a report in relation to
“the proposed criteria for appointment of Customs agents, and…the proposed standards which persons must meet to be approved for appointment”
within three months of the passing of the Bill. That will provide a level of certainty to companies about what criteria customs agents will be expected to meet in future. It is an incredibly uncertain time for businesses that export; they do not know what will happen next. This would give them a bit more understanding about the landscape that they will face.
Mel Stride
Clause 21 allows importers to appoint an agent to act on their behalf in respect of their import obligations. Currently, there is widespread use of customs agents who act on behalf of importers and exporters of goods, including by submitting customs declarations on their behalf. They provide a valuable service to importers and exporters.
There are two types of agent—direct and indirect, which are treated differently to represent the different relationships between them and those who appoint them. Direct agents make declarations on behalf of the importer, whereas indirect agents make declarations in their own name. Direct agents make their declaration using the importer’s identifier and they more often represent a domestic importer against whom any debt can be enforced. Indirect agents often represent overseas importers against whom any debt cannot easily be enforced. The changes made by clause 21 will allow the two classes of agent to be appointed.
The clause allows HMRC to make regulations about how the appointment is notified as well as withdrawn, which may be as little as confirming the appointment on the declaration. It also sets out the circumstances in which the agent is jointly liable for import duty.
Amendment 115 seeks to commit the Chancellor of the Exchequer to produce a report for the House of Commons regarding the introduction and regulation of customs agents under clause 21(7) within three months of the Bill’s enactment.
Clause 21(7) seeks to allow HMRC to introduce formal regulation regarding customs agents over and above the current requirement for them to adhere to customs procedures. The UK has authority to further regulate customs agents under the existing customs regime. There are currently no plans to introduce such additional regulation on customs agents, so requiring a report to be produced is unnecessary and will impose an administrative burden at a time when the UK is focusing on its future relationship with the EU. I would hope that the hon. Lady might reflect on my comments about no plans for change and withdraw the amendment.
Kirsty Blackman
I appreciate the Minister’s clarification and I hope to be able to share that with businesses and organisations that are concerned about the possible change. In that spirit, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 21 ordered to stand part of the Bill.
Clause 22
Authorised economic operators
Peter Dowd
I beg to move amendment 128, in clause 22, page 14, line 17, leave out “HMRC Commissioners” and insert “The Treasury”.
This amendment provides for the power to make regulations under Clause 22 to be exercisable by Treasury Ministers rather than HMRC.
The Chair
With this it will be convenient to discuss the following:
Amendment 116, in clause 22, page 14, line 36, at end insert—
“(4) Within three months of the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the proposed exercise of the power of the HMRC Commissioners to make regulations under subsection (1), including in particular—
(a) the proposed criteria to be applied in determining whether or not any person should be an authorised economic operator,
(b) an assessment of the structure of the authorised economic operator system in Germany, Austria and such other countries as the Chancellor of the Exchequer considers relevant,
(c) the proposed differences between the structure that is proposed to be established by the first exercise of the power to make regulations under subsection (1) and each of those structures described in accordance with paragraph (b),
(d) the level of proposed resources to be allocated by the HMRC Commissioners for the authorisation of new authorised economic operators, and
(e) the target timetable for the authorisation of—
(i) new authorised economic operators in each class, and
(ii) authorised economic operator certification renewals in each class.”.
This amendment requires the Government to report on the proposed operation of the powers of the HMRC under Clause 22, including comparative information.
Amendment 129, in clause 22, page 14, line 36, at end insert—
“(4) No regulations may be made under this section unless a draft has been laid before, and approved by a resolution of, the House of Commons.”.
This amendment requires regulations under Clause 22 to be subject to the affirmative procedure.
Clause stand part.
Amendment 130, in clause 32, page 19, line 32, after “regulations” insert “under section 22 and”.
This amendment is consequential on Amendment 129.
Peter Dowd
Amendment 128 would confer powers on the Treasury to act as authorised economic operators instead of HMRC commissioners, for whom the clause currently creates powers.
Clause 22 allows the setting up of an authorised economic operator scheme, which is an internationally recognised quality mark indicating that an operator has met recognised standards of compliance. The status could give special access to some customs procedures and the right, in some cases, to fast-track shipments through customs. Clause 22 gives HMRC the powers to make regulations to not apply sections of part 1 of the Bill to those with such a status, or to ensure that the status is recognised procedurally in other ways.
Once again, this is a very wide power given to HMRC commissioners to ignore large sections of the Bill in relation to certain operators. Under the amendment, we hope to shift the powers from HMRC commissioners to Treasury Ministers. There is a simple reason for that: Treasury Ministers are democratic agents, accountable to the general public. We cannot allow a situation where unelected officials can disapply large sections of parliamentary legislation with no democratic recourse or public oversight. The clause would effectively give HMRC power to refuse to apply all of part 1 of the Bill, from clause 1 all the way to clause 38. Surely this sweeping power, if it has to be created, should be held by a Minister of the Crown—ideally with additional parliamentary scrutiny, as we have tried to ensure throughout other parts of the Bill.
The clause highlights yet another case where democracy is being brushed aside for the purpose of expediency. Our amendment seeks to restore accountability. I hope that members of the Committee will support it today.
Amendment 129 and consequential amendment 130 seek to amend clause 22 and clause 32 respectively. In both cases, the amendments would add a requirement for the Government to introduce affirmative regulations to make further policy. Under clause 22, that is for the purposes of setting up an authorised economic operator scheme.
The use of the negative procedure in that case was commented on in the Lords Delegated Powers and Regulatory Reform Committee report, which addressed the matter of regulations made under the negative procedure under clause 22 as follows:
“Clause 22 allows HMRC Commissioners to make regulations ‘disapplying or simplifying’ any of the law relating to import duty made by or under Part 1 of the Bill (clauses 1 to 38) in relation to “authorised economic operators”, a term that will be amplified in regulations and which essentially covers operators who meet internationally recognised standards of compliance. Bearing in mind that clause 22 covers the other 31 regulation-making powers found in Part 1 of the Bill, its scope is very wide. Given the width of this power enabling HMRC to waive compliance with the law, we consider that these regulations should be subject to an affirmative procedure.”
Again, the Lords are bringing home the point about democratic accountability.
Amendment 129 seeks to amend the Bill, following the advice of that cross-party Committee, because of another example of the Government sidestepping parliamentary scrutiny. We want—we will say this time and again—to reintroduce some measure of scrutiny into the process. Similarly, amendment 130 brings the notes under clause 32 into line with the changes made in clause 22, as I described earlier. It is therefore a consequential amendment in ensuring that the Bill properly reflects the comments made by the Delegated Powers and Regulatory Reform Committee. As I am sure everyone will agree, the proposals are all about parliamentary scrutiny in the important area of customs policy.
Kirsty Blackman
It is most unusual to hear the Lords held up as champions of democratic accountability, but the work of the Delegated Powers and Regulatory Reform Committee on the Bill has been incredibly useful, and it has allowed us to have a more knowledgeable debate on the subject. It was quite reasonable of the Opposition to have brought forward their amendments.
I will speak to amendment 116, which I intend to press to a vote. It is about authorised economic operators, which is what the clause covers, because I have real concerns about the system. I am not the only person to have concerns—they have been expressed previously—about how the UK manages the AEO scheme within the UK. The UK scheme is managed dramatically differently from schemes in other countries, which is a real concern for businesses.
The Government’s customs White Paper mentioned that people could be authorised economic operators, and basically suggested that that would solve all their woes. Given how difficult it is for companies to become authorised economic operators, and given HMRC’s shortcomings in overseeing the process and ensuring that it is as smooth and quick as possible, I have real concerns that the system cannot be used effectively by many businesses as a way to ensure—slacker customs procedures is not the right term—slightly different customs procedures that would allow things to move a bit more smoothly.
In the amendment in my name and that of the hon. Member for Dunfermline and West Fife, we are looking for the Government to provide more information. Part of that is about giving businesses certainty further in advance, and part is about ensuring that the Government think about how the authorised economic operators scheme will go forward.
Among the various things we are asking for in the amendment is
“the proposed criteria to be applied in determining whether or not any person should be an authorised economic operator”.
Part of that is to do with the issue that the UK Government and HMRC have had with requiring companies to have someone with three years of customs experience in order to be approved as an authorised economic operator. That is how things have been applied and work now, but if we suddenly include the, I think, 130,000 new companies that have not previously had to do customs checks, we will need a different system, because those companies will not have someone who has been working for three years in a customs-related role. The Government will have to agree that some sort of external company can take on the role of that person, or that the companies can have a differentiated system until they have had that three years of experience in exporting. It is reasonable to expect the Government to be a bit more flexible.
Our proposed new paragraph (b) asks for
“an assessment of the structure of the authorised economic operator system in Germany, Austria and such other countries as the Chancellor of the Exchequer considers relevant”.
Although the scheme is internationally recognised, the way in which it is implemented and the way in which the equivalents of HMRC oversee it varies wildly by country. In some places, the system is much quicker, and it is much easier to get through the process. Companies receive more assistance and guidance to get them through the process, and the officials make a determination about applications more quickly.
It is important for the Government to look at other countries. The British Chambers of Commerce said that Austria and Germany do this in a much smoother way; that is why those countries are included in the amendment, but it would be completely reasonable for the Government to include any other countries that they think are relevant.
Paragraph (c)—
“the proposed differences between the structure that is proposed to be established by the first exercise of the power to make regulations under subsection (1) and each of those structures described in accordance with paragraph (b)”—
would again require the Government to provide us with more information in advance. Paragraph (d), on
“the level of proposed resources to be allocated by the HMRC Commissioners for the authorisation of new authorised economic operators”,
is pretty critical. Given that I assume the Government expect to see a dramatic increase in the number of applicants for authorised economic operator status because of the number of companies that will be exporting for the first time, it is reasonable that they should report on how they intend to ensure that sufficient resources are allocated to seeing the process of authorised economic operators through.
Paragraph (e) is about
“the target timetable for the authorisation of…new authorised economic operators in each class, and…authorised economic operator certification renewals in each class.”
We have heard concerns that the renewal process for an authorised economic operator can take 12 months. If that is so—that may be an outlier—that is a ridiculous length of time for a renewal. The Government may decide that they want a first application to take that long, but I would contend that even that is pretty excessive. It would be incredibly useful for the Government to set out what the targets are, so that companies know, when they are going into the system, how long the Government intend to take in making a decision. When a company is considering, for example, exporting to a new market or changing the way it does it exporting, it should be able to look at the Government’s timeline and plan on the basis of how long it will take them to process the authorised economic operator approval or renewal.
It would be sensible for the Government to come back with all those answers. Businesses would be very happy if the Government gave them more certainty about all those matters. This is a pretty comprehensive amendment, and it relates to a number of aspects of the authorised economic operator scheme that I have concerns about. I hope the Minister will provide a degree of certainty about all of them. If he cannot, I will be keen to press this amendment to a vote.
Mel Stride
Clause 22 provides the framework under which the UK can set up its version of an authorised economic operator. AEO schemes give compliant traders who meet certain criteria access to simplified customs arrangements. The AEO concept is well known in international trade. A total of 41 customs territories, including the 28 EU member states, have introduced a version of an AEO scheme. Providing authorised traders with simplified customs arrangements is encouraged under the World Trade Organisation trade facilitation agreement.
AEO status operates as a quality mark. It indicates that a business’s role in the international supply chain is secure, and that its internal systems are compliant with HMRC customs controls. AEO status is not mandatory. However, in general AEO schemes enable traders to access customs facilitations and simplifications and undertake customs activities with only light-touch oversight from customs authorities. They allow customs authorities to distinguish between lower and higher-risk movements of goods, avoid unnecessary targeting of resources, and provide customs simplifications and facilitation of legitimate trade.
Clause 22 allows HMRC to set out what customs requirements or procedures can be simplified for AEOs, sets out where HMRC must take account of AEO status when administering the customs system, and gives the criteria or conditions that a business must meet before AEO status is granted. The clause also provides for the creation of different classes of AEO status, which enables the Government to develop simplification schemes appropriate to different types of business, and to match them with robust but achievable criteria and application procedures, thus avoiding a one-size-fits-all approach.
Amendment 128 seeks to ensure that the Treasury, rather than HMRC commissioners, exercises the power to make all regulations under the clause.
Kirsty Blackman
The amendment does not call for a review at all; it calls for a report to be provided. It is not about concerns being raised about the current operation of the scheme, but about how HMRC will look at the scheme going forward.
Mel Stride
I thank the hon. Lady for that clarification. She is right: I said “review”. However, my comments are equally relevant to a report on how it is going and thoughts on how we move forward.
The inclusion of clause 22 reflects the feedback from businesses enjoying the benefits of the current AEO regime. In responding to calls for continuity in that regime, it will help to minimise any potential disruption. What is more, HMRC has already committed to improving the authorisation process for traders and has been meeting with businesses, as I outlined, since last autumn to consider practical improvements to the process. The process is ongoing and includes drawing on the best practice of other countries.
On the amendments, the draft regulations will make clear what the authorisation criteria for AEO status will be. It will largely be the same as the current EU criteria. Those regulations will also set out the details of AEO status, which will largely be the same as the current system.
Kirsty Blackman
It would be very useful to know whether the Minister has any idea when the regulations will come forward. Part of my concern was the lack of advance notice for businesses.
Mel Stride
That will be determined to a large degree by the negotiation that is in play with the European Union and by whether we have an implementation period. We are hopeful that such a period will be seen to be in our interest and that of the European Union. The measures will be brought in at the appropriate time, as and when we require our own stand-alone system, so that we are ready on day one and have the regulations that will allow us quickly and effectively to introduce AEO status. It is not about having a one-size-fits-all model. It is about having different classes so that we are able to be helpful in particular to the small and medium-sized enterprises that we recognise may benefit from a different approach from that for larger businesses.
Amendments 129 and 130 would apply the draft affirmative procedure to all regulations made under clause 22. The Bill ensures that the scrutiny procedures that apply to the exercise of each power are appropriate and proportionate considering the nature, length and technicality of the regulations and the frequency with which they are likely to be made. The Government believe that using the negative procedure under clause 22 provides a sufficient level of parliamentary scrutiny, while having regard to the technical nature of the regulations. The regulations may, for example, be used to specify the criteria and processes that HMRC uses when determining whether a business can be authorised as an AEO. Regulations may also set out where and when HMRC must take account of AEO status when administering the customs system. Adopting the draft affirmative procedure for these types of regulations will affect the expediency and efficient administration of the customs regime. For those reasons, I urge the hon. Lady to withdraw the amendment.
Anneliese Dodds
I do not want to try the patience of the Committee—I know we have been here for three hours—but I hope it is acceptable to push a little on one element of amendment 116 that the Minister did not address explicitly. The amendment, which was tabled by the SNP, demands that there should be a report on
“the level of proposed resources to be allocated by the HMRC Commissioners for the authorisation of new authorised economic operators”.
The Committee still lacks clarity on how many of the new processes will be delivered in taxes.
I was grateful to the Minister for responding to a parliamentary question that I laid just before Christmas on the comparative strength of the UK in customs officers as compared to other nations. His response suggested that it was not possible to have a comparative analysis. He said that the European Commission collated figures, but they were not directly compared and would not be comparable.
I have since looked at the World Customs Organisation’s annual report for 2016-17, which compiles information given to it directly by customs organisations. What came out of that is concerning. It suggests that we have about 5,000 customs officers, and there is a commitment from the Government that we might have an additional 3,000 to 5,000, although it is unclear when that will be decided. Those customs officers currently process 77 million declarations for import and export—that number could go up substantially if we shift out of the EU customs union—so each customs officer has to process about 15,400 declarations per annum. According to the report, that is 10 times as many as every US or Canadian customs officer. It is 15 times as many as German customs officers, more than 30 times as many as Australian customs officers and about three times as many as customs officers in Hong Kong, Norway and Switzerland. There may be issues with comparability with some of those data sources, but they must be pretty big issues if that large gap can be accounted for just through different reporting processes. The SNP is absolutely right to call for more clarity on how exactly the new procedures will be resourced adequately.
Mel Stride
I thank the hon. Lady for her intervention, which was characteristically acute and well informed. I hope I can reassure her that we take the resourcing of Her Majesty’s Revenue and Customs in this context extremely seriously. It is one of the critical elements that HMRC is looking at. On a number of occasions when I have met with Jon Thompson, the head of HMRC, it is very high up on our agenda as a very important issue that we are tracking on a regular basis. HMRC carried out a detailed review of resources required to manage an upturn in authorised economic operator applications, including a review of lead times and dealing with an increase in applications as we approach March 2019.
Initially, the UK may wish to follow the current Union customs code approach to the AEO programme, depending on the outcome and the progress of the negotiations. If that were the case, it would simplify matters quite considerably, at least in the near term. In the longer term, HMRC has carried out extensive discussion with stakeholders, as I mentioned earlier, to identify ways in which the application process might be streamlined. That will inform the development of future schemes.
On the general points that the hon. Lady understandably made about staffing levels and the large number of additional declarations that will potentially come our way on day one, depending on the outcome of the negotiations, she is right that HMRC has indicated that 3,000 to 5,000 would be about the range of additional staff that we will be looking at. The Chancellor made it clear in his recent Budget that £3 billion will be made available—£1.5 billion per year—across all Departments, including HMRC, to make sure that appropriate requests are met. We are not only very close to the requirements, but very much engaged in ensuring that they are appropriately resourced.
In terms of increasing the volume of declarations that we will be handling, we are working on the IT side and on the custom declarations service system. Our commitment in that area is important.
Question put, That the amendment be made.
Westminster Hall
(6 years, 10 months ago)
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Marriage in Government Policy
(6 years, 10 months ago)
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Derek Thomas (St Ives) (Con)
I beg to move,
That this House has considered marriage and Government policy.
I am pleased to have secured this debate and grateful for the opportunity to speak to this important subject. I am also pleased to see a good number of Members here; I hope that is a sign of support for the promotion of the importance of marriage in Government policy. I welcome the Minister and wish him well in his new role.
In a week’s time, we will celebrate the 21st national Marriage Week. It will be 20 years ago this summer that I married my wife Tamsin Thomas. She tells the tale that when she met me, she was Christmas shopping and I was standing on a street corner with a bottle of methylated spirits. That is true, but it does not exactly explain the situation.
I would be wrong if I said that we had been happily married for 20 years—that it had been idyllic and that there had been no challenges. There have been considerable challenges; when she moved into my home, I found her moving the cutlery in the cutlery drawer frustrating enough. But I recognise that over those 20 years I have had a wife who has raised my children and been a tremendous support to me. I have been no help at all: I spent years working on the marriage and then left her to come to this place. I give credit to my wife and all the wives and husbands of Members across the House who are so supportive in the work that we do. I recognise the challenge of having strong and healthy marriages and couple relationships in which we raise our children.
It is now seven years since a Government Minister took the opportunity to set out the Government’s approach to promoting marriage in a speech during Marriage Week. When we last debated this issue in 2017, the Minister’s predecessor but one tried to reassure Members that
“the Department intends to continue to work very hard to ensure that marriage gets the support it needs to continue being a strong bedrock for the families and the children for whom we want to secure the best possible outcomes in the future.”—[Official Report, 1 February 2017; Vol. 620, c. 389WH.]
Alison Thewliss (Glasgow Central) (SNP)
I am not sure whether the hon. Gentleman will come to this in his speech, but my constituents raise with me on repeated occasions at my Friday surgeries the difficulties that the Home Office places on their marriages. They cannot see their spouses because they live abroad and cannot get into the country. Does he agree that by not allowing people to live out their marriages, the Home Office is undermining people’s relationships?
Derek Thomas
I intend to demonstrate that the Government need to look clearly, across Government policy and Departments, at their role in promoting and protecting marriages and families. I will not be particularly interested in the issue that the hon. Lady mentioned in her intervention, but I am sure that there will be an opportunity to tackle that subject as we go on.
The Minister said that the Department intended to continue to work very hard to support marriage, but some weeks later it omitted the word altogether in its plans to support the poorest families in our country. Many Members will join me in making what I think is a simple request: for the Minister to ensure that no serious policy document is published by his Department without some reference to improving the stability of families through marriage. I hope the Minister might make that commitment today.
Research shows that unmarried parents are six times more likely to break up before their first child’s fifth birthday. By the time a British teenager is studying for their GCSEs, they are three times more likely to live with both their birth parents if those parents are married. Three in five children born to unmarried parents experience family breakdown before they reach their teenage years. In fact, by the time children take their GCSEs, nearly all parents—93%—who stay together are married. Put simply, family stability is found in marriage. Why do we continue to ignore that? We know that family breakdown causes poverty.
More alarming still is the gap in marriage between those families living in poverty and their middle-class neighbours. Marriage is disappearing from our poorest communities as it is disappearing from Government policy. Almost 90% of middle earners get married, compared with only a quarter of couples on low incomes. If we had that sort of gap between rich and poor in health, education or probably any other policy area, there would be immediate outcry followed by determined action. On that basis, and remembering the maxim “what gets measured gets done”, I suggest that the Minister does something within his power. Will he ask his Department to look into the marriage gap, publish official figures for rates of marriage by family income, and make that a departmental metric for measuring stability in families?
Michael Tomlinson (Mid Dorset and North Poole) (Con)
I congratulate my hon. Friend on securing the debate. I warmly welcome the Minister to his place; we all look forward to his response. Was my hon. Friend as struck as I was by the Centre for Social Justice and the Family Stability Network’s research showing that nearly 80% of young people aged 14 to 17 aspire to a lasting relationship and find that as important to them as a long-term career?
Derek Thomas
I welcome that comment. It is encouraging to know that there is still a commitment by the public, including among young people, and a natural, in-built desire to have a long and lasting stable relationship.
In recent years, the Government’s evidence on what causes poverty now and in the future has identified family instability as a root cause. Children in families that break apart are two and a half times as likely to experience long-term poverty and have almost double the risk of living in relative poverty than couple families.
I know the Government would wish to tell a positive story about their efforts to encourage work as the best route out of poverty. Despite significant progress, lone parents still have double the unemployment and more than three times the underemployment than couple families. Last year, the Department for Work and Pensions published data that showed that the children of parents who have separated are eight times more likely to live in a workless family than those whose parents have stayed together.
None of what I have said is ever meant to stigmatise lone parents, who face some of the most serious challenges, but it should make the Minister, his Department and Government across the board consider how we can reduce those figures by supporting families to stay together. Those statistics alone should alarm us. The break-up of families more than doubles the chances of experiencing poverty—two and half times the poverty risk and eight times the risk of worklessness. Not all couples are married, but we should reflect on where stability is found because the statistics are compelling.
My hon. Friend the Member for Mid Dorset and North Poole (Michael Tomlinson) mentioned that the Government have no reason to shy away from this subject. There is public support for marriage. There is some good news to be found in public attitudes and there is new evidence that the Government should not be afraid to talk about marriage. Last year, the Centre for Social Justice published opinion research that showed that almost half the public feel that marriage has become less important over the last few decades and agree that that is a bad thing, including 47% of adults in social grades C2, D and E, where breakdown is most acute. When people were prompted to consider the role of Government in supporting marriage, more than seven out of 10 agreed that marriage is important and that Government should support married couples, including more than two thirds of adults in social grades C2, D and E. We should all remember that the public support a Government talking about marriage.
I was privileged to be able to put my name to the strengthening families manifesto launched last year. The manifesto sets out some entirely sensible recommendations designed to strengthen the family unit and address many of the difficulties that I have briefly touched on. Among many sensible suggestions, the manifesto calls on Government to appoint a Cabinet-level Minister to ensure that family polices are prioritised and co-ordinated. It simply asks that in each Department there is a senior Minister responsible for delivering policies to strengthen families and for carrying out family impact assessments—something the Conservative Government had previously committed to.
Since arriving in this place, I have often heard that the Government aspire to Britain’s being a world leader on a whole raft of subjects that include innovation and research. The sad truth is that we seem to be a world leader on family breakdown, with half of all young people no longer living with both parents by the time they sit their GCSEs. There are obvious reasons why the Government would want to address this very important issue.
Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)
I congratulate my hon. Friend on securing the debate. I am sympathetic to many of his points, but he raises a broader point about cohabiting couples and the benefits of a solid family base for supporting children and young people. What additional measures does he suggest should be put in place to support people who do not want to get married to live together and raise a family?
Derek Thomas
I believe that measures to support marriage, whether through taxation or by supporting and encouraging people who are considering marrying or moving in together, would actually support all people who are living together in families like those my hon. Friend describes.
I do not believe that promoting marriage or putting in place measures to support married couples would discriminate against any other type of family unit; it would help to strengthen them and give them access to support. I recognise—I hinted at this earlier—that moving into a family home together is a challenge for people and that unexpected difficulties often arise, so it is right that we should do what we can to help.
Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)
My hon. Friend is right that promoting and supporting marriage is not about saying that every other choice is bad, but it is worth recognising that marriage and cohabitation are fundamentally different relationships. Too often they are elided together as though there is just a marginal difference. There is not: there are fundamental reasons why people choose to cohabit, which are hugely due to their level of commitment. A good example of that is that when a child is born to a married couple, the likelihood of that couple breaking up falls dramatically, but when a child is born to a cohabiting couple, the likelihood of that couple breaking up accelerates dramatically. That shows there is a fundamental difference between the two, so it is important to look at them separately.
Derek Thomas
As I said, by the time they do their GCSEs, 93% of teenagers whose parents are still together have married parents, so I support what my right hon. Friend says.
There are obvious reasons why the Government should want to address this important issue. We all want our children and young people to have the very best life chances, we want our communities and schools to thrive, and we want our working age population to enjoy fulfilled lives. As the Prime Minister said, we want a country that works for everyone. That said, no Government can solve such a complex and sensitive problem single-handedly, so the Government urgently need to provide a lead and play their part alongside local partners—councils, charities and businesses—to prioritise strengthening families, which are the bedrock of a healthy society.
In conclusion, will the Minister’s Department renew its commitment in this area? If it does, we will need to consider policies to support marriage, and I am aware of many colleagues—many of whom are in the Chamber—and policy organisations, such as the Centre for Social Justice, who would help in that endeavour. I invite the Minister to convene a ministerial working group on marriage in the coming weeks, to coincide with the 21st national Marriage Week, to thrash out a way forward and some sensible policy recommendations.
Luke Graham (Ochil and South Perthshire) (Con)
I thank my hon. Friend for giving way during his concluding remarks. It is really important for us, especially as Conservatives, to think about how we can support individuals. Marriage can be good, but a lot of marriages fail.
We need to be careful that Government policy does not hold up a paradigm of perfection for what marriage could be when, for many people, it does not necessarily work out. Of course we want stability, but as Conservatives we should support individuals to lead strong and fulfilled lives. I hope that my hon. Friend agrees that Government policy should focus on supporting individuals rather than on enforcing a paradigm.
Derek Thomas
I would, of course, expect any Government—particularly a Conservative Government—to support individuals to have fulfilled lives, but no one enters a marriage expecting it to fall apart. The Government have a role in supporting people and giving them the best possible chance to make marriage work, for the various reasons I have outlined.
I would welcome action from the Minister, whom I welcome again to his new role. I hope that marriage is a happy and rewarding subject for him and is at the forefront of his mind as he begins his work at the Department.
Andrew Selous (South West Bedfordshire) (Con)
I apologise in advance that I will not be able to stay for the whole debate; I am a member of the Select Committee on Health, which is sitting at the moment, and I need to attend that, too.
We need to tread gently in this area. Marriage is often an issue of great cultural controversy, but it does not need to be. As my hon. Friend the Member for Ochil and South Perthshire (Luke Graham) said, we represent every single one of our constituents, whatever their family situation, but that does not mean that we should not strongly support healthy, respectful and mutually encouraging marriages. We can do both those things without creating unnecessary cultural controversy.
Of course I recognise that some marriages need to end. My parents sadly divorced, and—my hon. Friend the Member for St Ives (Derek Thomas) said something similar—my wife would say that I have often been very much less than a perfect husband. However, I am strongly pro-marriage as a public institution, for three reasons. First, we know that it reduces poverty. I came into the House to reduce poverty. I spoke about it in my maiden speech; for me, it is at the heart of what the Conservative party is about.
Secondly, marriage increases wellbeing across an enormous range of indicators—perhaps a wider range than we realise. On any measure—overall physical and mental health, income, savings, employment, educational success, general life contentment and happiness, sexual satisfaction, and even recovery from serious disease and healthy diet and exercise—married people rate markedly and consistently better. We should want the best possible wellbeing for all our constituents.
Thirdly, I believe that sustainable public finances are the only future for this country, and strong families and marriages are essential to helping the Government live within their means. Given his portfolio in the Department for Work and Pensions, the Minister will be well aware of that.
There are lots of reasons to be positive about marriage. We sometimes approach the subject slightly gloomily, as if it is all going irreversibly downhill and there is nothing we can do about it, but I am grateful to the Marriage Foundation and Paul Coleridge for giving us reasons to be cheerful at the start of 2018. It is a fact that most marriages—around 62%, according to the Marriage Foundation—still last for life. Most parents who marry before having children stay together, as my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) said. Most marriages are happy, and the divorce rate is at its lowest since 1973. The trend away from marriage has stopped; its popularity is stabilising. Marriage has remained consistently strong among certain income groups. Finally, this is a royal wedding year. Will and Kate’s wedding in 2011 was followed by the biggest increase in marriage since the war—weddings increased by 23% in the first quarter of 2012 and by 11% in the second quarter—so we might well see something similar after May.
I am concerned by the social divide in marriage. The better-off have always married in large numbers, and they continue to do so, but in our poorest communities, which have the most challenging circumstances, the marriage rate is plummeting. It is my strong contention that a respectful, healthy, mutually enabling marriage is a bulwark against poverty and all the difficulties that life throws at us from time to time.
I have four policy requests of the Minister. First, will he ensure that registrars, who conduct about 70% of weddings, signpost people to good-quality marriage preparation in their area? That is not difficult to do, and we are not talking about forcing people to do anything. However, there is generally good feedback from people who do marriage preparation, and they often want to follow it up with marriage MOTs later on to keep the marriage strong, which is also a sensible idea. Can we therefore please do something to spread good-quality marriage preparation, followed by marriage enrichment later on?
Secondly, can we do something in antenatal education for all families? At that time, mums and dads turn up in huge numbers before a child is born, so let us do something to strengthen relationships then.
Thirdly, the Government are about to launch guidance on relationships and sex education. We need to talk about marriage there, while recognising that families come in many different shapes. It is crucial that marriage is not absent from that document, and those of us on the Government Benches will expect to see it.
Finally, I reiterate the point made eloquently by my hon. Friend the Member for St Ives. We need to measure this issue. We value what we measure, and we measure what we value. We need to get marriage back in the statistics. We need to know what is happening, to track it and to ensure there is an upward trend.
Jim Shannon (Strangford) (DUP)
I congratulate the hon. Member for St Ives (Derek Thomas) on securing the debate. I was happy to go to the Backbench Business Committee and support him in his request, and I am happy to see the culmination of that request. I am well known as a supporter of marriage, especially in Government policy. I have been happily married for 30-plus years—believe it or not, 30-odd years ago I had thick, curly black hair. Then, I needed a brush; now I just need a chamois.
The fact of the matter is that I have supported married life over a long period, I am totally committed to it and I want to see Government policy on it. Since I came to the House in 2010, I and the hon. Member for Congleton (Fiona Bruce), who is in her place—she will not mind me saying this, because it is true—have shared in many issues of common concern, and this is one of them. In the past, she has worked consciously in the Conservative party, as I have done in the Democratic Unionist party, to try to formulate Government policy. By working together across parties—not just in the confidence and supply agreement that we have now, but long before that—we have had some success with the marriage allowance. We were instrumental in making that Government policy. I want to put that on the record early on.
I and my party worked extremely hard to bring in marriage tax allowance transfers as a recognition of the stabilising effect that marriage provides to our community. The public policy benefits of marriage are significant. The hon. Member for St Ives outlined some of them, and I will add these facts and figures: three quarters of breakdowns of families with children under five come from the separation of non-married parents; children are 60% more likely to have contact with separated fathers if the parents were married; the prevalence of mental health issues among children of cohabiting parents is more than 75% greater than among children of married parents; and children from broken homes are nine times more likely to become young offenders—they account for 70% of all young offenders.
Those are some key figures. However, I want to be clear: in no way whatsoever am I am attempting to say that the only unit that works is the married family unit. I see this in my office every week, and just now my staff will be dealing with many people who are single parents. I see hundreds of wonderful women who singlehandedly run their homes, and their children are well adjusted and thriving. I increasingly see single men taking on the two-parent role and doing a great job. As the hon. Member for South West Bedfordshire (Andrew Selous) said, society is changing, and we have got to look at that. The intervention from the hon. Member for Ochil and South Perthshire (Luke Graham) reaffirmed that. We must adjust our focus and way of thinking to how things are today.
I understand as much as the next person that marriage is hard and relationships are hard. Sometimes, no matter how much one person may try, it simply will not work. In our relationship, my wife has been understanding. The hon. Member for St Ives referred to time away, and most of my life has been away from home. My wife reared the children and now has the role of rearing the grandchildren as well. Simply, people have to try hard, otherwise it will not work.
I have also seen too many women widowed in the troubles. I relate very much to that, back home in Northern Ireland, where women have to be both mother and father to their child in the midst of tremendous grief and ensure that their child has not simply a house to live in, but a home to grow in. The role of those tasked with the responsibility of looking after children is so important. I make no judgment on anyone’s ability to provide a great home for their child being intrinsically linked with marriage, but statistics show why I believe that marriage is key and why it should be key in any Government policy. I wish the Minister well in his new role.
One massive issue to recognise is that the commitment of marriage is a driver for stability, quite apart from wealth. Crucially, even the poorest 20% of married couples are more stable than all but the richest 20% of cohabiting couples. In that context, it is entirely appropriate that our tax system now recognises marriage. That is something we pushed for and the Government recognised in the previous Parliament. It is good to have that.
Alison Thewliss
The hon. Gentleman is making a good point about income and marriage. The Government seem to recognise that in the tax system, but not in the immigration system. I have a constituent who had tried to bring his wife here since 2007. Gladly, she has now arrived, but he was short by £7 over the whole year in his salary and the Government refused to operate any discretion to allow her to come from Iran.
Jim Shannon
I agree; I have faced many similar cases in my constituency office. I look to the Immigration Minister and her Department to be fair and allow for some flexibility in the process. To be just a few pounds short is frustrating. We have a system to work within, but we make our cases on behalf of our constituents and their wives and spouses in other parts of Europe, the United States, Africa and even further afield in the far east. The difficulties are around financial contributions, so we need a flexible Government and flexible policy. That is not this Minister’s responsibility, but it is another’s.
As I have said before, the case for change is compounded by the fact that the Government spend more money on supporting marriage through the much more generous married couples allowance than they do through the new marriage allowance. The married couples allowance applies to married couples in which one or both spouses were born before 6 April 1935, while the new marriage allowance applies to one-earner married couples on basic income tax. While £245 million was spent on the married couples allowance, just £210 million was spent on the marriage allowance during 2015-16. The former can reduce a tax bill by between £326 and £844.50 a year, but the latter does so by only up to £230 a year. That is a help, but it does not fulfil the aim. It is important to have those facts and figures on the record in Hansard so that we can see where the differences are and where we need change. I hope that others agree.
It is absolutely right that we recognise the public policy benefits of marriage for adult wellbeing at all ages. However, given the special benefits in relation to child development, it seems strange that we should afford the marriages of couples in their 80s and 90s, whose children left home long ago, greater recognition than those in which the public policy benefits could reach both adults and children.
We need a system that addresses families and children rather than those who are long past that stage. In that context, the Government should introduce a fully transferable allowance and pay for it by reducing its scope to married couples with young children. That would do away with the problem of low take-up by ensuring that the allowance is really meaningful for those who are eligible. At the very least, the marriage allowance for those with pre-school children should be increased so that no marriage of a couple in their 80s or 90s is recognised more—and not, indeed, by £844.50—than that of a couple with young children. Rather than just spending the same sum on a reduced pool of married couples, we need some change in the system.
I briefly referred in the Chamber, during the Budget debate, to the ComRes polling from last November; this is for those who follow ComRes and perhaps fill in their forms whenever they come. The poll demonstrated that increasing the marriage allowance is much more popular, with 58% support, than bringing in yet further increases in the personal allowance, which got 21% support. If we are looking for something that is more acceptable to the general public—we need to be conscious and cognisant of that—here is a simple system.
The cost of the further projected increases in the personal allowance to £12,500 is £4 billion, the majority of which will go, as the Institute for Fiscal Studies has demonstrated, to those in the top half of the income distribution. By contrast, any increase in the marriage allowance would disproportionately benefit those in the bottom half of the income distribution.
If we take away housing benefit from couples who get married, and reduce working tax credit for families who marry and move in together, we make it less appealing for people to make that final commitment. We have outlined the social benefits of marriage, and the Government should feed something into that and make it more attractive for people who love each other and are in a committed relationship to marry. That is what my heart as well as my voice says, and what would benefit families and communities throughout the United Kingdom of Great Britain and Northern Ireland. I ask the Minister seriously to consider the issue of the marriage allowance and how to achieve what we set out to do in putting that in place. Many in the House, including many of those present for the debate, think the same.
Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)
I welcome the Minister to his place. I have worked with him over a long time, and having run the Department I have a fair idea of the challenges that lie ahead of him. I am going to add to them. I congratulate my hon. Friend the Member for St Ives (Derek Thomas) on obtaining the debate, particularly this week, of all weeks.
Under the previous Prime Minister I was nominated to construct the family test against which everything was going to be measured. When I finally left—of my own volition, by the way—at no stage had I managed to get agreement from any of the key players about what it would consist of. While there was a principle, which was that the Prime Minister wanted a test that all decisions would be set against, the reality was that the Treasury in particular was not keen on any of it. I urge the Minister to press for a definition of the family test, by which all the effects of policy decisions could be looked at to see whether they would damage the family or make things more difficult. That would make logical sense.
I want to be brief, as I just want to make a start on a couple of issues, beginning by asking what the debate is not about. The trouble is that we all tiptoe around and get amazingly worried about the word. We think: “If I mention marriage, does that automatically mean worrying about whether marriages break up or other people do not choose to get married, and so on?” I know of nothing else in the purview of government where such a fear reigns in quite that way. We do not talk about business policy on the basis that some businesses will fail. We do not immediately say, “We must not talk about business or try to set policy to help businesses survive.” We do those things, because it is logical. Of course, in society as in economic life there will always be things that do not work out, but that does not mean people should set their life around what does not work out. If we all did that, frankly we would look a lot like North Korea. The point is we do not do it, so let us now make policy around what works and what is clear.
Marriage, frankly—this is not an arrogant statement—is probably the most fundamental institution that society has ever managed to construct to make society better, give children a better chance and improve the incomes and wellbeing of those within the process, as has been said. That is not to say that when, sadly, a marriage breaks up we should not do our level best to help people, and try to find them a better way and support them. That is critical. However, it means there is a need to recognise a couple of features. I am chairman of the Centre for Social Justice, which has been making this argument for some time, and we did a poll. What we found was the thing that always most intrigues me: when young people between about 18 and 28 were asked without reference to marriage what one thing they aspired to more than anything else, more than 70% aspired to be married, with stable families and a happy life. They did not aspire to be brilliantly successful at business; that was not their No. 1 aspiration. They did not aspire to have a fast car or a smart house. Their aspiration was for a social arrangement that would deliver them a happy outcome for the rest of their lives.
In any other area of life we would worry about such aspirations never being met by the reality. What, then, given that young people start with that aspiration, are we doing to make it less likely that they will achieve it? If that happened with respect to any other process, in school or in society, and we said “That is not a problem,” then of course we would be causing damage, but in this case we walk away from the issue. My arguments about policies on marriage are not to do with favouring marriage. I do not think it needs to be favoured in any way. People’s basic instinct and sense of direction will take them towards the thing that benefits them and their families most. I am certain that that is the nature of the situation. The question we really need to ask is what we do that stops people who have that aspiration getting to where they aspire to be.
I have a couple of points to make about that, beginning with the OECD’s view of what it costs for two people to live together, in comparison to the cost of living for one person. It makes a base calculation and comes up with a figure. It is not the same as two people together—the calculation includes how savings can be made within a couple. We understand and accept that. The UK, peculiarly—this emanates from the Treasury and every other Department—somehow takes the view that we need to go further. Financial policy here makes it more difficult than it is in almost any other country for a couple—particularly if they are married—to stay together. The cost of getting married is higher here than in any other country, because taxation is set against doing it.
I have been told by a number of my colleagues, “No one gets married for money.” Only someone from a reasonably well-off middle-class background will endlessly take that view. People in a low-income family where every pound really matters will calculate how best to manage their affairs. If one situation makes them better off, there is enormous pressure to decide on that as their direction of travel. I should love us to look carefully at why the UK persists in making it financially more difficult for people to come together to marry, and to stay together. Those are really big issues, and the figures are there.
Alison Thewliss
Does the right hon. Gentleman accept that, because universal credit is set up so that there will be a single recipient in a household, many women are subject to financial control, which makes it far more difficult for those who face domestic violence to leave a relationship, because they cannot afford to?
Mr Duncan Smith
Not really. I do not accept that at all. Universal credit operates by looking at the household, which makes it more likely that couples are supported to stay together. The hon. Lady knows that the vast majority of married people—and, by the way, even cohabiting people—have joint accounts. The figure is way over 80%, and I think it is close to 90%. For those in an exceptional position, it is clear that the money will follow the person with the duty of care. Those rules are written into universal credit, so I simply do not agree with the hon. Lady. I think that universal credit will help enormously to get rid of what I and the right hon. Member for Birkenhead (Frank Field) referred to as the couple penalty.
The cost of weddings is another issue that we need to consider. There is an idea that people cannot get married now unless they have a fantastic celebrity wedding. The average cost of a wedding is now more than £20,000, whereas what people actually need is a marriage licence. There should be pre-wedding education to tell people: “You do not need to make such a big fuss about it. What you want to do is get married.” One big reason for so many marriages breaking up—probably more than anything else—is debt. If people start married life in debt because of making such a big issue of it, that puts enormous pressure on couples.
Andrew Selous
A pastor in my constituency told me something that struck me, which was that up to the early 1980s many couples who married were happy to live in rented accommodation, perhaps with other people’s crockery and cutlery. They did not need everything to be perfect, but later on that changed and people felt they needed all new white goods, and so on. That may have been a disincentive to marriage. Does my right hon. Friend recognise that picture?
Mr Duncan Smith
I think that with the whole Hello! culture around the idea that people have to have a perfect fairy-tale wedding, no one is preparing them for the fact that once they are married, they will make compromises and face huge difficulties and stresses, and it is about how they cope with those. That would be far better than telling them some fantastic fairy tale: “Nothing will ever be a problem, and you’ll live happily ever after.” No relationship I have ever seen has ever been like that. The question is how to manage it, and preparing people properly for that is an enormously important feature of what we do.
The other area I will talk about is counselling. Earlier on, when I was in Government, we drove through more money to help support marriage guidance and counselling. The one thing we know, and some of them will say this, is that with the proper counselling and support probably close to half the families that are heading for break-up can change, re-stabilise and stay together. That is a critical point. We are now investing £30 million in that, yet the price of the after-effects of break-up is numbered at closer to £50 billion.
Even though I have argued for more money to go in, and I thank the Government for putting more money in, it seems like a pretty mealy-mouthed concept that we invest so little money, when that money really reaps a dividend in stabilising families and helping them stay together. If it were anything else in life, we would consider it a major benefit that that amount of money returned such a phenomenal cost saving. That cost of £50 billion would fall quite dramatically. My hon. Friend the Member for South West Bedfordshire (Andrew Selous) mentioned the stability on divorce; one of the reasons for that is that we started investing in marriage guidance and counselling. Imagine what we could do if we spent even more money on getting people immediately into counselling. That would have a huge effect, and I urge my hon. Friend the Minister to view that straight away.
The last point is marriage prep. I stand with all those who say that the key thing is to educate people to understand what it really means to start out on arguably the most important agreement they will ever make. People get terribly fussed about being members of things like golf clubs, where there are all sorts of peculiar and stupid rules around what they can and cannot wear, and everyone is very strict about it. If we mention that there are things people can and cannot do in marriage, however, everyone immediately says, “This is not something we need to lecture people about. We should not talk about it.” The answer is that the most important thing we will ever do is to form that relationship and ultimately, if we are lucky, to bring up children, and we want to make it as stable as possible.
If any Government sit there and worry about what people will say when they say they support marriage, because some will break up and there will be problems, we will never get anywhere. We now need to make the case for stability and strength, and help those who are unable to make that process.
Fiona Bruce (Congleton) (Con)
It is a pleasure to follow the powerful contribution of my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), which highlights the gravity of the issue.
I will begin by thanking the several Ministers who have recently stated in this place their desire to see policies developed that support and strengthen family life. They have done so in response to the publication in September of “A Manifesto to Strengthen Families”, which my hon. Friend the Member for St Ives (Derek Thomas) referred to. I congratulate him on securing this timely debate in the run-up to Marriage Week this year. The manifesto contained 18 policies, which are the fruit of many years’ work; many colleagues here today have spent several years speaking and working on the issue. After its publication in September, it garnered the support of more than 60 Back-Bench Conservative MPs.
The new Minister, whom I welcome to his place, need not worry if he has not seen the manifesto, because I will give him a copy at the end of the debate. After its publication, a number of Ministers spoke in support of it. Both the Leader of the House and the Health Secretary stated their interest in how the policies in that paper might feed into Government policy. The Prime Minister told the House in October that the Government are.
“looking into what more we can do to ensure that we see those stable families”.—[Official Report, 18 October 2017; Vol. 629, c. 846.]
She recognised the wide range of benefits that committed family relationships can bring, as we have heard today, such as improving wellbeing, reducing poverty and reducing Government spending.
On the wider beneficial aspects of marriage, the former Education Secretary, my right hon. Friend the Member for Putney (Justine Greening), said in this House that it was “exceptionally important” to include marriage in relationships education because:
“At the heart of this is the fact that we are trying to help young people to understand how commitments and relationships are very much at the core of a balanced life that enables people to be successful more generally.”—[Official Report, 6 November 2017; Vol. 630, c. 1189.]
As I have said, I congratulate my hon. Friend the Member for St Ives on securing the debate. It is so timely, because marriage has a key role in helping people to promote the stable relationships that support life chances for them and their children, their children’s educational attainment and future employment, boosting mental health and reducing the risk of addiction in later life. It can help combat loneliness in old age, help reduce the pressure on GP visits due to depression and reduce absenteeism at work. It can positively influence so many areas of life and, of course, beneficially influence the public purse.
I want to put it on record, as I always do in these debates, that there are difficult cases in which it is better for a child not to be in the same home as one of their parents. I always say that there are many single parents who work valiantly, and successfully, to ensure that their children flourish and have a positive future to look forward to, but we have to remember that the statistics speak for themselves. The Marriage Foundation, as we have heard, has recorded that 76% of married couples are still together when their child has their GCSE exams, but only 31% of unmarried couples are still together.
I am particularly concerned about the statistics showing that only 24% of those in lower income groups marry, compared with 87% of those in higher income groups. Marriage is such an important issue that we cannot afford to ignore it in public policy. I believe that, because family breakdown affects the poorest most, it is a social justice issue. In fact, it is one of those burning injustices that the Prime Minister spoke of so movingly on the steps of Downing Street when she took office. We need to address it, because if we do not, we will not only fail a generation of children who aspire to marriage, as we have heard, but let down the poorest of those children. That is why it is such an important issue of social justice.
Children from low-income households with an active father are 25% more likely to escape the poverty they grow up in. I will look at a number of policies, touching on some of those in “A Manifesto to Strengthen Families”. Research from the Social Trends Institute into families with children under 12 showed that Britain has the highest level of family instability in the entire developed world. We languish at the bottom of that table and successive surveys have shown that children in this country are among the unhappiest.
I have several points to make about policy, as I say. Will the Minister restate the Government’s commitment to the family impact assessment or family test, which was introduced by the last Prime Minister, David Cameron, to ensure that the Government never have a blind spot in this area? I recently tabled a number of parliamentary questions, asking what every Department of State is doing to ensure that this is appropriately applied. Will the Minister look at those responses, because they are extremely disappointing? The family test is not being applied in the comprehensive way that I believe the former Prime Minister intended.
New research from the Marriage Foundation confirms that family breakdown, which ultimately affects nearly half of all teenagers, is a clear cause of many children’s and teenagers’ emotional and behavioural problems. That should not really be news to us, but I encourage the Government to properly address family breakdown as part of its comprehensive review of mental health strategy. We need to ensure that we are not just helping the young people—the children themselves.
Dr Poulter
My hon. Friend is making a very good speech, and I agree with many of the points that she has made. I would caution about statistics and the difference between causation and association. She is pointing out an association between mental health and some of the points that she is raising, but actually young people’s mental health is far more complex than that and there are many confounding factors that may call into question that association. I caution that marriage should not be put at the centre of mental health policy for young children.
Fiona Bruce
I disagree. I am a patron of a mental health charity that specialises in counselling young people in my constituency called Visyon. It now counsels children as young as four with mental health problems. It is overloaded—inundated—with counselling requests. Not long ago, I asked the chief executive officer, “How many of the children and young people you help to counsel have problems as a result of dysfunctional family relationships at home?”, and he looked at me and said, “Fiona, virtually all of them.” That is why it is so important, when we are counselling young people, that wherever possible we look at how we can also support their parents in their relationship. It is also why I am such a supporter of the “Emotionally healthy schools” programme, which is being pioneered by Middlewich High School in my constituency. When children in that school have problems, the headteacher, wherever possible, will ask the parents to come into the school, will meet them and will help them to ensure that the children’s home relationships are as healthy as possible to ensure that they have the best chance of flourishing, both educationally and in the future. We need more counsellors to be trained, to ensure that they are not just counselling young people but, wherever possible, working with their families to combat the epidemic of mental health problems in this country among young people.
Sir Desmond Swayne (New Forest West) (Con)
I agree with my hon. Friend, but the same argument about causation and association is applied directly to marriage itself. The argument is made that were all the cohabiting couples to marry, the statistics for break-up would not change. How do we refute that argument?
Fiona Bruce
Let us have a look at that, because my right hon. Friend, as always, raises a very pertinent point. From the outside, couples living together look the same whether they are cohabiting or married. Two people might be in love; they live together; they have a baby. What is the difference? I believe that the difference is commitment and, indeed, public commitment. The public promise made during the marriage ceremony sends a powerful message to the parties and to their friends and family round about, which can engender support from those friends and family when rocky patches occur. The message is, “We are committing ourselves to each other through thick and thin,” and that, after all, is the determination when people marry. A dialogue often precedes it that does not happen when people cohabit.
When people cohabit, there has often been what is called sliding rather than deciding to have a relationship; it happens without that preceding dialogue and mutual understanding of what it entails. That is why I so support the proposal that there be more pre-marriage counselling. In fact, I would go further and say that we should promote—this has been suggested by a number of groups and organisations—high-quality marriage preparation. That should be available to anyone who goes into a registry office and wants to get married. And we should waive marriage registration fees for couples who take part in an accredited marriage preparation course.
All that is what makes the difference between cohabitation and marriage. I am talking about giving young people the extra ability to work out whether they really want to be together and to stay together. There are statistics—yes, they are from the United States—showing that many couples going through marriage preparation courses decide not to marry, and that is a success in itself. They have made that decision in a contemplative and considered way.
Our problem today is actually not divorce but the trend away from marriage, although I was pleased to hear my hon. Friend the Member for South West Bedfordshire (Andrew Selous), who is no longer in his place, say that the reduction in the number of people marrying has stalled. That is very helpful, but we need to combat the widespread assumption that cohabitation is living together as if married, because unless couples decide and do not slide, unless moving in together is part of a clear plan for the future, it is not. Unless they have discussed their approaches towards having children, finances and working when a family comes along, it is not the same.
Before closing, I will touch on one or two other policies, mentioned in the “Manifesto to Strengthen Families”, which I hope the Minister will consider. First, as we have heard, the Government have to ensure that the concepts of commitment, respect and safety are at the heart of the newly developed curriculum for relationships and sex education from an early age. That should include talking about marriage. I realise that that will need to be done exceptionally sensitively, but the Government need to make good on the comments of the former Secretary of State for Education that it is exceptionally important that marriage and its benefits be emphasised if we really care about the life chances and wellbeing of the children who will be the next generation of adults. We must not be embarrassed to mention that sensitively in schools. The next generation will not thank us for failing to teach them what a committed relationship means. If we do not do so, they will pay the price, and as I have said, the poorest will pay the highest price of all.
Secondly, I reiterate the importance of the Government continuing to look at removing the financial disincentives for those on low incomes to marry. This is in the manifesto. We want the Government to enable those who are on universal credit and entitled to the marriage allowance to receive the tax break automatically as part of their claim, and to ensure that it does not taper away. Will the Government also look at increasing the marriage tax allowance to a more significant level, which I believe would in turn boost uptake? In all the areas to which I have referred, it is possible for the Government to make small but impactful, positive changes to support marriage and family stability and therefore life chances.
This should not be a party political matter; it is too important. I welcome the contributions that we have heard today and particularly that from the hon. Member for Strangford (Jim Shannon), of the Democratic Unionist party, but I want to place this point on the record. I did not do so in last year’s debate in the run-up to Marriage Week, but I will do so now. As I believe was also the case last year, there is not one Labour Member in the Chamber today, other than the requisite Opposition spokesman, and this issue, which is about a burning injustice, deserves better than that.
Steve Double (St Austell and Newquay) (Con)
It is a pleasure to serve under your chairmanship, Mr Rosindell. I congratulate my hon. Friend, and fellow Cornishman, the Member for St Ives (Derek Thomas) on securing this very important debate. I wholeheartedly agree with virtually everything that has been said by hon. Members who have contributed; I shall just add a few points of my own.
As we have heard, virtually every indicator demonstrates clearly that marriage is a good thing. It is good for the people who are married and for the children who are raised in a family that is based on a married couple, and it has very significant benefits for wider society and our economy. By virtually every measure—whether we are talking about physical health, mental health, educational outcomes or economic measures—marriage is a good and positive thing, and that seems to be clear to everyone. So I am sometimes more than slightly baffled about why the Government often appear so shy about saying that. The Government are not shy about saying that other things are good for us. They often tell us that we should all take more exercise. They are not shy about telling us that we should eat a healthy diet, and they often tell us how much alcohol is safe to drink. They are even taking measures these days to reduce the amount of sugar that we have.
It seems strange that, on something so fundamentally important that has such huge benefits, the Government are so shy to speak up—to say what a great thing marriage is for everyone concerned. If there is one message that I would like to put to the Government via the Minister, who I am delighted to see in his place today, it is that they should not be bashful in saying what a great thing marriage is.
As other hon. Members have said, we all accept that not everyone chooses to be married and that marriage is not always a positive thing for some people. We absolutely accept and respect that, but it should not mean that we shy away from saying what a positive thing marriage is. It does feel at times as though marriage has become the M-word in Government policy that is missing. I add my voice to those who have called on the Minister to play his part in his new role and ensure that marriage and the benefits of it are highlighted in Government policy, statements and documents, so that there is an unequivocal message from Government that we believe marriage is good.
The Government should take confidence from the fact that there is clear data showing that the popularity of marriage is increasing. Some 80% of under 18-year-olds surveyed said that they desired to be married and saw it as an important part of their life, on a par with having a successful career. The Government should be confident in speaking up for marriage. It is popular, and because of that we should also ensure that marriage and its benefits are promoted to young people through our education policy. Just as we give them career advice and help them in choosing their careers, right at that young age we should get the benefits of marriage across to them and help them to understand that.
I am aware that there is not much time left, but I want to make one further point: it is about civil partnerships, which have not really been covered by any other contributions. I am aware that a private Member’s Bill calling for civil partnerships to be extended to all people will come before the House shortly. When I saw that that private Member’s Bill was coming, I seriously considered how we should address this issue. It is clear to me that civil partnerships were a stepping stone towards same-sex marriage. We are where we are on that, but it seems to me that the current position, where there is one option for formalising a couple’s relationship that is open to some but not to everyone, is unsustainable.
One way of addressing the situation would be to extend civil partnerships to all. I have come to a different view. I actually think that civil partnerships are now unnecessary. Marriage is open to all, including same-sex couples, and we should give a clear message that we believe marriage is the best option. We should not confuse the matter by seeking to provide an alternative. We simply do not need the distraction of finding new ways of doing what has been around for thousands of years.
Luke Graham
My hon. Friend is making some very positive points about marriage. Given that there is now a record number—about 33.9%—of single people in the United Kingdom, should we not be encouraging any form of partnership, including heterosexual civil partnerships, to encourage people to go into stable relationships with each other? That seems to be what gives the greatest benefit to the individuals and any children involved. When it comes to Government policy we should be providing equality in law for everyone who wants to engage in meaningful relationships. As Conservatives, we would hopefully help to promote that rather than promoting one choice over another.
Steve Double
Some people will make that argument, and I absolutely respect it. Having considered the matter, however, I have come to a different view: that providing a competitor to marriage would dilute and undermine the positive place that marriage has in our society. That is my concern: that extending civil partnerships to heterosexual couples would provide competition for marriage. There should be a clear, positive, single message that marriage is a good thing to encourage in our society. That is my position, having thought about it. I respect my hon. Friend’s view, but it is not the view that I have come to. Civil partnerships are now unnecessary in our country. Stopping them and putting the focus on marriage would be the right step to take.
I have been married for 32 years this year. Lots of people say that I do not look old enough to have been married that long, but hopefully I am a demonstration that marriage is a good thing. I am very grateful to the very long-suffering Mrs Double, who has done more than her fair share to make sure that our marriage has stuck together and been successful over that time.
Like all of us who have been married, I know that, like anything in life worth having, it is sometimes through hard work, blood, sweat and tears that marriages are successful. I believe that it is important that the Government do all they can to help, support and encourage married couples to make a success of their marriages, that we remove all the barriers and disincentives in Government policy to marriage and to couples staying together, and that we give a very clear message and are not at all bashful in saying what a good and positive thing marriage is for everyone involved.
Angela Crawley (Lanark and Hamilton East) (SNP)
It is a pleasure to serve under your chairship, Mr Rosindell. I congratulate the hon. Member for St Ives (Derek Thomas) on securing this debate and on his efforts to ensure that Marriage Week is celebrated in Parliament.
Marriage is a changing institution, and within our lifetimes it has changed dramatically. In fact, when the institution of marriage was originally created, the average life expectancy was 30 years. If we look at the statistics for marriage rates, we see that the number of people getting married each year is falling. At the same time, the age at which people are getting married is increasing: people of my generation are marrying on average 10 years later than their parents. On top of that, marriage rates are on the increase among over-65s, having increased by half between 2009 and 2014, which also says a lot about people living longer. So in my opinion, while marriage trends are changing and adapting to people’s wishes and needs, the institution of marriage does not appear to be under threat.
However, I am somewhat astounded, if no less grateful to the hon. Member for St Austell and Newquay (Steve Double), that equal marriage was finally mentioned one hour into the debate, although much of his attention focused on civil partnerships. I find it astounding that the Government did not take this opportunity to recognise all forms of marriage, and instead focused on nuclear and “2.4” families. I am sure that the Minister will address that in his response, but I just expected more from the Floor of the House.
While I welcome recent changes that allow same-sex couples across Scotland, England and Wales to marry, it is a great disappointment that that is still not possible in Northern Ireland. I hope that the hon. Member for Strangford (Jim Shannon) shares that concern. This is a great freedom for many couples who identify as lesbian, gay or bisexual, and as we approach LGBT History Month it has never been more important for the Government to put on record their support for same-sex marriage, recognising that everyone should be equal in the law and under the protections therein.
Giving same-sex couples the right to marry allows them to validate their relationship in a way that was previously denied. It is a move forward, closer to a more equal society, and allows those people to choose whether to get married, just like their peers. For many others, it is just as relevant not to marry. We have talked about cohabitation and suggested that it is not on an equal par with marriage, but I suspect that many families would disagree. I do not think that it is this House’s place to determine the sanctity of anyone’s relationship, whether they are cohabiting, married or otherwise. It is a choice, and we should simply enable that choice to be made by all individuals equally.
On many occasions, long-term cohabiting couples have just as successful relationships. So while I recognise the comments of the hon. Member for St Ives and the hon. Member for Congleton (Fiona Bruce) on the statistics—which, yes, are alarming—I would echo the sentiments of the hon. Member for Central Suffolk and North Ipswich (Dr Poulter), who cautioned us about the correlation of statistics in relation to marriage and mental health. The simple fact is that there are many successful families and they come in many shapes and forms, and marriage is not the sole indicator. While the hon. Member for St Ives outlined those statistics and suggested that children are more successful where there is marriage, I would caution that it is neither our role nor responsibility to lecture those who do not choose to marry.
As the term “marriage equality” suggests, the sanctity of marriage should be available to all, but we should also respect those who choose not to marry.
Angela Crawley
No, I will continue.
Finally, many people’s marriages and relationships end. When they do, it is Government’s responsibility to create policy to support and protect those people, not to penalise them, especially not vulnerable parents with children to raise. If tackling child poverty is this Government’s aim, using this debate to lecture others on the sanctity of marriage is not the best use of time, especially when there are other aspects of Government policy that do not support families as they should.
I therefore take this opportunity to focus once more on Government policy, which is, of course, part of the subject of this debate, and to call on the Government to address the charges for the Child Maintenance Service. Where a relationship breaks down, many parents do not choose to live separately or rely on the Child Maintenance Service, so it is unfair and unacceptable to penalise parents or levy charges on one or both parents trying to support their children despite the breakdown of a marriage or relationship. Many parents rely on the Child Maintenance Service. The levy imposed is unfair and penalises children, who need the service most.
Marriage is and always should be a choice available to everyone. I hope that the House will recognise that.
Margaret Greenwood (Wirral West) (Lab)
It is an honour to serve under your chairmanship, Mr Rosindell. I congratulate the hon. Member for St Ives (Derek Thomas) on securing this debate, and I welcome his inclusion of the importance of protecting families and his focus on providing stability for children. However, I take exception to his claim that family instability is the root cause of poverty, when we know that this Government’s cuts to social security are creating problems for families.
Social security support for low-income families has been cut severely. Most working-age benefits, including child benefit, have been frozen until 2020, and universal credit has been shown to be failing those on low incomes, causing debt and rent arrears. When universal credit was introduced in 2011, the coalition claimed that it would lift 350,000 children out of poverty. By 2013, that estimate had been reduced to 150,000, and by 2016 the Government refused to offer any re-evaluation at all. Can the Minister tell us how many children he believes universal credit will lift out of poverty?
Child Poverty Action Group published an analysis last November estimating that cuts to universal credit would push 1 million more children into poverty by 2020, along with an extra 900,000 adults. When we consider the situation for disabled children, we see that four in 10 are living in poverty, yet the basic level of support for disabled children in universal credit is less than half that available in tax credits.
We have had some interesting contributions; it has been good to hear people talk about how much they have enjoyed their own marriages. I welcome the call from the hon. Member for South West Bedfordshire (Andrew Selous) to tread gently, as marriage is often an issue of cultural sensitivity, and the comments of the hon. Member for Strangford (Jim Shannon), who spoke of the hundreds of wonderful women he has met who are bringing up families alone. It is important to recognise that many people choose to bring up children on their own, and some people find themselves in that situation due to relationship breakdown or bereavement.
Since 2010, successive Governments have sought to reduce the role of the state wherever possible, especially in social security, yet when it comes to whether or not two people should marry—surely the most private of decisions—the coalition Government sought to influence behaviour in relation to that decision by introducing the marriage allowance in April 2015. Details of how the new transferable allowance would work, given in a note published alongside the 2014 Budget, stated:
“Couples where both partners are basic-rate taxpayers will in almost all cases see no gain or loss…Couples will benefit as a unit, but the majority (84 per cent) of individual gainers will be male.”
One must question the introduction of an allowance that the Government knew would disproportionately benefit men; I would be interested to hear the Minister’s rationale for it.
Take-up of the marriage allowance has been poor. Up to October, 2.4 million couples had claimed it, out of an estimated 4 million who were eligible. According to Government figures, the cost in 2015-16 is expected to be £385 million when backdated claims are ultimately included, and £425 million in 2016-17. It prompts the question whether that is really the best use of taxpayers’ money at a time when child poverty is soaring and the Government are cutting support for disabled people under universal credit and the employment and support allowance work-related activity group.
On pension equality, the question is whether some marriages are more equal than others in the Government’s eyes. The Government have spent a great deal of time and, no doubt, a sizable sum of taxpayers’ money opposing pension equality for same-sex couples. When the Marriage (Same Sex Couples) Act 2013 was debated in Parliament, the Opposition called on the Government to close a loophole in the law meaning that married same-sex couples and civil partners were treated differently when it comes to pension entitlement in the event of one partner’s death.
In July, the Supreme Court ruled in favour of equality in a landmark case brought by John Walker, a gay man who found that after 20 years of service to his company, it would provide £1,000 a year in pension to his surviving husband were he to die, whereas if he were married to a woman, she would receive £47,500 a year. Indeed, were he to divorce his male partner and then marry a woman, she would still receive the larger amount. When do the Government intend to respond to the Supreme Court ruling? Will the Minister ensure that the ruling will not be affected by the UK leaving the EU, as it was based in EU law, and will he assure us that the Government will end the disparities in public sector pension schemes?
The Government’s claim that they want to support marriage is also at odds with how cuts in social security since 2010 have put additional pressure on families and parents. Families on low incomes have faced long waits for initial payments of universal credit; figures last week from the Department for Work and Pensions show that one fifth of claimants are still not being paid in full on time, and more than one in 10 are not even receiving partial payment on time. Then there are the cuts to work allowances on universal credit, and the new, lower household benefit cap introduced in November 2016. At the same time, food prices in December were more than 4% higher than the year before. Families on low incomes tend to spend a higher proportion of their wages on basic items such as food and rent.
The Government have recently announced that they intend to create a new cliff edge for eligibility for free school meals, so that families with household earnings of more than £7,400 a year will no longer qualify. The Resolution Foundation has estimated that allowing all children whose parents claim universal credit to receive free school meals would cost £600 million a year. The chief executive of the Financial Conduct Authority warned in the autumn of the scale of the problem of household debt, and a recent study by the Institute for Fiscal Studies showed that one in four of Britain’s poorest households are falling behind with debt payments or spending more than a quarter of their monthly income on repayments.
Relate has highlighted how debt problems can easily lead to conflict and relationship breakdown, whether or not partners are married. That can have a serious impact on children, as research suggests that conflict, rather than family structure, has a negative impact on children’s development. The household benefit cap is forcing families to move away from sources of support such as family and friends. People on a low income may not be able to afford to travel back to see them frequently, either. More than 500 Sure Start centres have closed since 2010. They are another important support for more vulnerable parents in particular. If the Government value family, marriage and stability, why are they closing them? Again, I am keen to hear the Minister’s rationale.
Since last April, parents have been required to start looking for work as soon as their youngest child reaches the age of three, rather than five as was previously the case. A new report published by Save the Children last week found that many mothers would like to return to work or increase their hours, but find childcare simply unaffordable and Government help with the costs complex and difficult to access. Under tax credits, childcare costs are paid in advance, whereas under universal credit they will have to be paid up front and then claimed back, which is always likely to be problematic for parents on low incomes.
Of course, parents in many families are not married, and there are many lone-parent families. Government must recognise and value all family types. The alternative is to risk stigmatising families to no good purpose. Lone-parent families are particularly affected by access to childcare, and have been hit hard by cuts to social security since 2010. An independent study by the Equality and Human Rights Commission of the long-term impact of tax and welfare changes between 2010 and 2017 found that lone parents were set to lose an average of about 15% of their net income. That is almost £1 in every £6.
Lone-parent families make up one in four families with children, and have done for more than a decade. They are part of the mainstream of UK family life, and social policy needs to take that into account. Where a separated or divorced couple shares care of the children, the parent who is not the main carer cannot claim for an extra room for those children under the rules of the bedroom tax, for example. That can cause extreme difficulty for a family who must cope with the break-up of a relationship, and can cause parents, often fathers, to struggle to spend quality time with their children. A Labour Government would scrap the bedroom tax altogether. Will the Minister reconsider the rules of the bedroom tax as they currently affect separated couples to ensure that children do not suffer?
Where relationships unfortunately break down, changes to the child maintenance system have clearly not succeeded in supporting care for children or enabling parents to reach agreements themselves.
In 2012, the Government introduced a new system for child maintenance that aimed to nudge couples to reach agreement without the need for Government intervention. However, it does that by charging both parents—including the parent with care of the child or children, known as the “receiving parent”—if they fail to reach agreement independently.
The Department published a survey in December 2016 that found that around a third of receiving parents who paid the Child Maintenance Service application fee reported that it was difficult to afford. Of parents who did not have a maintenance arrangement at three months, 29% said that the £20 application fee was a factor. Of receiving parents with a direct payment arrangement, 42% cited a desire to avoid collect-and-pay charges as a reason for choosing direct pay and half said that the charges were a factor in their decision.
Will the Government take action to widen access—
Andrew Rosindell (in the Chair)
Order. I ask the hon. Lady to wind up, so that the Minister has a chance to respond.
Margaret Greenwood
I will.
In conclusion, a stable, loving family is undoubtedly what we would want for all children, but there are many types of family in the 21st century. My right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman) once said:
“Families come in all shapes and sizes. We don’t favour one way of family life over another. We want to support and back up all families...Government dictating family structures doesn‘t work.”
She is right. This is a question of respect.
The Government should commit to stable families by putting an end to austerity, by giving our schools, police and health services the funding they need, by banning zero-hours contracts, by ensuring that refuges are available for people fleeing domestic violence and by ensuring that the social security system is there for people in their time of need.
The Parliamentary Under-Secretary of State for Work and Pensions (Kit Malthouse)
It is a pleasure to begin my Front-Bench career under your beady eye, Mr Rosindell. I congratulate my hon. Friend the Member for St Ives (Derek Thomas) on securing this debate and pay tribute to the work that he has done over the years on this issue, which is deeply important to him. I also thank hon. Members for a sensitive and thoughtful debate.
The Government are committed to supporting families, and it is right to draw attention to an issue that affects a wide range of Departments as well as mine. This debate was called in connection with Marriage Week, which takes place between 5 and 14 February. That provides a good opportunity to celebrate the commitment and connectedness that a stable relationship brings to a family.
The Government’s view is that families are fundamental in shaping individuals and that they have an overwhelmingly positive effect on wider society. Growing up in families where parents are collaborative and communicate well gives children the environment they need to develop into happy and successful adults. The vital institution of marriage is a strong symbol of wider society’s desire to celebrate commitment between partners.
The institution of marriage can be the basis of a successful family life and many people make this important commitment every year. Marriage can lay the foundations for parenthood and is emblematic of the love and security that parents need to raise a child. The Government will continue to champion and encourage stable families that provide nurturing environments for children. That is why we are focused on helping families and children, to enhance the educational and employment opportunities available to the young and to reinforce the benefits that parental collaboration will undoubtedly have.
Although the Government support the positive impact that the stability of marriage can bring to family life, this debate is also an opportunity to celebrate the fact that relationships that provide the foundation for a stable and supportive family life across the United Kingdom come in different shapes and sizes. The Government recognise that a supportive family can take many different forms. Marriage plays an important role in our society, but we are committed to supporting different, and equally important, types of families, too.
Sir Desmond Swayne
How many different forms? Is a family any collection of people who happen to share a fridge?
Kit Malthouse
No, but it is clear that the key issue for a family unit is long-term commitment to each other, whether that is a religious, legal or emotional commitment.
It is an unfortunate fact of life that marriages, like other relationships, can and do break down, but the Government have been clear that even when a family has separated, both parents still have a positive role to play in the lives of their children. Evidence shows that parental collaboration has a direct and positive impact on children’s outcomes. They tend to have better health and emotional wellbeing and higher academic attainment if they grow up with parents who have a good relationship and manage conflict well. That is why we are committed to supporting healthy relationships between parents, whether married or cohabiting, together or separated, in the best interests of children.
We have already made good progress. Between April 2015 and March 2017, we invested £17.5 million in relationship support services, as my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) pointed out. More than 48,000 couples have participated in counselling and more than 17,000 practitioners have been trained to help families in difficulty. We could not have achieved that without our delivery partners in the Relationship Alliance—part of a broad range of stakeholders who contribute valuable insight and expertise.
In the light of the strength of the evidence about the damaging impact of parental conflict on children, my Department is working with local areas to implement a new reducing parental conflict programme, which will increase access to face-to-face, evidence-based interventions to reduce parental conflict. As announced in “Improving lives: Helping Workless Families”, our new programme will focus on vulnerable families, including those who are workless, because they are three times more likely to experience relationship distress.
Given the time remaining, I will turn to the four broad themes raised by hon. Members. First, several hon. Members mentioned the suspicion that there was an element of cultural cringe at the mere mention of marriage. I reassure them that that will not be the case from my point of view. The Department is working hard to embed the family test across Government, as my right hon. Friend mentioned, and to offer advice to other Departments that are instituting it. It has been developed with our partners in the Relationship Alliance, and we will continue to push that forward.
On the relationships and sex education consultation that is coming out later this year, I understand that that will or should mention the importance of commitment, with a specific mention of marriage as an element of that.
Secondly, the Government’s support for stability in relationships will be an enormous departmental focus for us, not least because of the connection between relationship instability and worklessness. In last year’s Budget, we announced that we would spend an extra £39 million on that programme over the next few years. I welcome hon. Members’ contributions to its development. We are also developing a quality of relationship tracker—a relationship distress indicator—against which we will hopefully be able to measure performance.
Thirdly, my hon. Friend the Member for St Ives and others mentioned a ministerial working group. I would be more than happy to address that with ministerial colleagues. I think the Cabinet Office is the most effective Department for looking across Government at where we can put something together. I will write to my opposite number there to look at that.
Finally, several hon. Members raised the issue of financial support for marriage and whether it is enough, whether it is targeted properly and whether it should be exclusive to marriage or for commitment more widely. Although it would be dangerous to stray into Treasury matters at this early stage of my career, I am happy to write to Treasury Ministers to point out that although uptake of the marriage allowance has been successful to some extent—something like 2.6 million families now take part—hon. Members present feel that more could be done.
My door will always be open to hon. Members who are behind the strengthening families manifesto. Before becoming a Minister, I had a useful meeting with the all-party group about our crossover of interests around children’s interests, on which we are all focused.
In the preparation for my marriage, I was given a piece of advice. The chap who was preparing us said, “Kit, you have to remember that the day you get married is the day that courtship really starts.” That lesson has stuck with me for the rest of my life.
Derek Thomas
I am grateful for the opportunity to raise this issue. I thank all hon. Members who have taken part, and I thank the Minister for his open and positive response. I look forward to further discussions in the near future.
Question put and agreed to.
Resolved,
That this House has considered Marriage and Government policy.
NHS Negligence Cases
(6 years, 10 months ago)
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Andrew Gwynne (Denton and Reddish) (Lab)
I beg to move,
That this House has considered NHS negligence cases.
As always, Mr Rosindell, it is a pleasure to see you in the Chair. I know that it is highly unusual for a member of the shadow Cabinet to speak from the Back Benches, so I am grateful to the Opposition Whips and to Mr Speaker for allowing me to do so as a final opportunity to seek some form of closure for my constituent in this very serious matter. I am especially grateful to Mr Speaker for granting this debate.
Sadly, I have to publicly outline how my constituent, Mr Hawkins, has been let down by public authorities. The law and NHS rules have been abused to avoid giving him the justice that is rightfully his. His attempts to seek that justice, along with some semblance of honesty and humility, have already passed the decade mark, so I shall be grateful for the Minister’s reply after I set out the case.
Mr Hawkins was admitted to Tameside General Hospital on 28 June 2006 to undergo surgery to repair a ruptured left Achilles tendon. Rupturing an Achilles tendon can tear it partially or completely, making walking difficult and the ankle feel weak. The surgery was listed for theatre in the afternoon under the care of an orthopaedic consultant surgeon, Mr Ebizie, but then postponed to the evening. My constituent believes that the most simple and sensible solution would have been to postpone it until the next day, allowing him to remain under the care of the same surgeon. He believes that that did not happen, however, because it would have meant the hospital missing its five-day Government target for a patient to receive treatment or surgery after attending accident and emergency. Records indicate that the surgery was instead carried out by Dr Manikanti, assisted by Mr Kumar. Mr Hawkins states that the change of surgeon was made without his knowledge or consent. Subsequently, both clinicians have left the hospital and the country, and the names and titles of those who carried out the surgery have been disputed.
Mr Hawkins states that the surgeon made a critical clinical error. He believes that the surgeon misunderstood the positioning of the two diagonal sutures forming part of the modified Kessler suture. They were brought to the surface and closed, which permanently fixed the repaired Achilles tendon to the rear of his leg. On 7 July 2006, nine days after the surgery, the plaster cast was removed, revealing an open wound between the two sutures. Steri-strips were applied in an attempt to close the wound, but the duty consultant wrote in his records that the wound had healed very well after surgery. Mr Hawkins states that despite being aware of the error, the hospital failed to correct it by releasing the repaired tendon from the rear of his leg as soon as was medically possible. This allowed serious adhesion and tethering to form as the sutures disintegrated.
On 12 January 2007, Mr Hawkins was discharged from the care of Tameside Hospital. Throughout the previous months, the repaired Achilles tendon had been continually swollen because of the aggravation of the fixation. Mr Hawkins raised concerns, which were ignored. Weekly and monthly appointments at the hospital were required thereafter. Mr Hawkins believes that he was discharged by Tameside Hospital before he was clinically prepared and regardless of his condition. He feels that that was done to conform to Government targets.
Mr Hawkins immediately made a complaint through the hospital trust’s internal complaints procedures. He believes that on receipt of his letter of complaint, the trust should have called him in for an examination and a scan. It should have admitted that a serious problem had occurred and carried out a further operation to release the Achilles tendon from the rear of his leg. In Mr Hawkins’s mind, the matter would then have been resolved. However, the trust decided to take a different route: it instantly instructed Hempsons solicitors.
Although, obviously, Mr Hawkins is concerned about the clinical errors that have caused him lasting damage, he is rather more appalled by the actions of a variety of organisations afterwards. He believes that those actions were deliberately designed to cover up the fact that a clinical mistake had been made, caused primarily by the replacement of a consultant surgeon with a junior doctor.
In 2008, Mr Hawkins instructed a solicitor, who requested disclosure of all full medical records. The trust passed his request on to Hempsons. However, in the immediate period after his request he received only a very selective number of his own medical files from Hempsons. Mr Hawkins’s solicitor failed to ensure that all full medical evidence was disclosed within statutory time limits and failed to apply for a court controlled disclosure, while knowing that the records he had listed were missing. Mr Hawkins’s solicitor instructed a clinical litigation medical expert, who produced a case-closing report that failed the objectivity test and was therefore invalid. The trust and Hempsons initially failed to disclose relevant medical records, doing so only after continued and considerable pressure from Mr Hawkins.
Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)
The hon. Gentleman is a strong advocate for his constituent and makes a compelling case about the difficulties that his constituent has faced. Does he agree that the case flags up a wider problem? He mentioned solicitors being involved at a very early stage in the process. The current system for dealing with medical negligence in hospitals pushes defensive medicine and defensive approaches from hospitals. That fundamentally needs to change, because it is not good for doctors and it is not good for patients. Does he think that no-fault compensation may be a good way forward?
Andrew Gwynne
The hon. Gentleman makes an important point. As Mr Hawkins himself acknowledges, if the hospital trust had taken his complaint down a different route by accepting that it had made a clinical error and deciding to put it right, I would not be standing in Westminster Hall today raising his case.
Mr Hawkins continued with his complaint. In 2013, the trust eventually conceded and his remaining medical records were fully disclosed. On analysis of the records, it was plain to see that there were omissions and that pre-action protocol time limits had been exceeded. In response, Hempsons sought the opinion of a medical litigation expert. A report was produced, but it was based on the selected medical records that I mentioned earlier, as well as on the falsified information. Mr Hawkins believes that that report would fail any objectivity test and is therefore invalid.
Mr Hawkins had involved the Information Commissioner’s Office on two occasions: in 2009 and in 2013. In both instances, it judged that the Data Protection Act 1998 had been breached by the trust’s failure to disclose relevant medical records on several occasions. After much time and effort from Mr Hawkins, on 11 December 2013 the new management team at the trust finally admitted to maladministration and awarded remuneration for it. In a move that Mr Hawkins believes was an attempt to close his complaint and prevent the case from going back to the Information Commissioner, or to the court for disclosure, the new management team disclosed that it would no longer discuss actions taken by the old management team. Mr Hawkins also believes that the Limitation Act 1980 was breached from 2008 and that rules 31 and 35 of the Civil Procedure Rules 1998 were breached in compiling medical reports, because the medical experts failed in their duty to the court to be objective.
The delays in disclosure of information meant that Mr Hawkins’s complaint to the Parliamentary and Health Service Ombudsman was ruled out of time. My constituent believes that that makes a mockery of the trust’s failure to disclose his medical records within statutory time limits, which he believes the ombudsman ignored while upholding the strict time criteria regarding his making a complaint to the ombudsman.
Mr Hawkins appealed the decision on several occasions when the evidence was retrieved through the Information Commissioner. However, he was unsuccessful in overturning their original view that a letter from the trust indicated that the complaint was closed in 2007, which he utterly refutes. Hempsons later apologised and admitted that that letter did not clearly state that the local complaints procedure was closed. However, the ombudsman still refused to investigate the complaint and, in doing so, Mr Hawkins feels that the ombudsman has assisted the trust to conceal the cause and effects of a clinical error.
In 2013, Mr Hawkins wrote to the NHS Litigation Authority, as the trust was not reporting clinical mistakes. Initially, the NHS Litigation Authority would not get involved and requested my involvement, as Mr Hawkins’s Member of Parliament, which I duly offered. Two replies were received that indicated that the NHS Litigation Authority was involved in the case, despite previous assertions and written evidence that it was not involved. Mr Hawkins was notified in writing that the trust, on receipt of his letter of complaint, had instructed Hempsons in January 2007, with the NHS Litigation Authority directly instructing Hempsons and the trust from November 2007 to February 2009.
Hempsons was aware of a breach of the Limitation Act 1980 and the Data Protection Act 1998 when it disclosed to Mr Hawkins his missing medical records in October 2009. This means that the trust and Hempsons had illegally avoided disclosing all full medical records within statutory time limits and successfully passed the three-year limit for litigation. Mr Hawkins believes that indicates that the NHS Litigation Authority was aware that rules had been broken, yet failed to take retrospective action based on the strength of the evidence that he had disclosed to it in 2013.
The actions taken by the trust, assisted by Hempsons and the NHS Litigation Authority from January 2007 to December 2013, clearly indicate that the trust was covering up a clinical incident and its cause. With so much time having passed since my constituent first exited the operating theatre in the summer of 2006, I hope that today the Minister of State will be able to afford Mr Hawkins guidance and support in this matter, and finally bring to some closure what has been a dreadful episode for my constituent.
The Minister of State, Department of Health and Social Care (Stephen Barclay)
As always, it is a pleasure to serve under your chairmanship, Mr Rosindell.
I begin by commending the hon. Member for Denton and Reddish (Andrew Gwynne) for securing this debate. Although he opened it by saying that it is perhaps unusual for a member of the shadow Cabinet to secure a debate such as this one, it is absolutely right that he is doing so on behalf of his constituent and bringing these matters before the House. I am very sorry to hear about Mr Hawkins’s experiences, which have clearly caused him distress.
As you are well aware, Mr Rosindell, the NHS complaints process operates independently of Government, to prevent political bias in the handling of individual complaints. However, a number of points arise from the hon. Gentleman’s remarks, in respect of his contention that Mr Hawkins was let down by a number of individuals and organisations within the NHS. Specifically, it is alleged by Mr Hawkins that the hospital failed him by prioritising then Government targets, which delayed his operation; that the clinician failed him through clinical error; that the duty surgeon failed him by falsely reporting that his wound had healed; that the hospital failed him by not correcting the alleged mistake and by instructing lawyers; that Hempsons solicitors failed to disclose full records; that his own solicitors failed him by not obtaining his records; that his own clinical medical expert failed him; that the hospital failed him, regarding his report; that the ombudsman failed him; and that the NHS Litigation Authority failed him.
Although the Department of Health does not comment on individual cases, and it is not for me to adjudicate whether all of those claims by Mr Hawkins are valid, it is worth noting that a very wide range of both individuals and organisations are alleged by Mr Hawkins either to have conspired against him or, indeed, to have failed him in this matter.
It is also worth placing on the record that NHS Resolution, which was formerly the NHS Litigation Authority, informs me that in January 2016 it first became aware of an independent medical report commissioned by Thompsons, Mr Hawkins’s own solicitors, which had not been previously disclosed to NHS Resolution in the course of Mr Hawkins making his claim. That medical report concluded that there was nothing to suggest that the operation in question had been performed anything but competently. Although I very much recognise that the hon. Gentleman’s constituent is of a different view, and he is perfectly entitled to be of a different view, it is worth placing on the record that his own medical expert, who reviewed this case, did not feel that the operation had been performed in the way that Mr Hawkins has claimed.
I note that Mr Hawkins referred this matter to the Parliamentary and Health Service Ombudsman, which is independent of both the NHS and Government, but the ombudsman ruled that the claim was out of time. Ombudsman decisions are final and there is no automatic right for them to be reviewed. However, the law provides for the ombudsman to consider whether to review a decision if it was demonstrated that the ombudsman made their decision based on inaccurate facts, or that there was new and relevant information that was not previously available, or that they had overlooked or misunderstood parts of the complaint or relevant information.
If a complainant believes that there has been maladministration in the handling of their complaint, they can apply to the courts for a judicial review. However, that must be done within three months of the conclusion of the complaints process.
Andrew Gwynne
The Minister hits the nail on the head there, and it is where the system has let Mr Hawkins down; Mr Hawkins will have been listening very attentively to the case that I set out. Mr Hawkins was denied that ability to apply for a judicial review because of the way that the hospital itself had delayed the process by not informing him that the case had been formally closed, so that by the time he was advised that the case was closed, the time limit by which he was able to take a legal route had passed.
Stephen Barclay
I very much recognise the point that the hon. Gentleman is making. Obviously, I do not want to get drawn into the specifics of this individual case, for the reasons that I have already set out, but within this case and within the claim made by Mr Hawkins a number of factors have been outlined, and I recognise that the hon. Gentleman’s point is one limb of the claim that Mr Hawkins has made.
What brings the various issues together is a question that I think applies to all of us, from all parties in the House: in the future, how do we collectively avoid cases such as Mr Hawkins’s case, and how do we improve the complaints process? That is an area where the Government have been particularly active, not least following “Hard Truths”, the report into Mid Staffordshire and the issues that arose there. The Department of Health has established the complaints improvement board to take forward a series of projects to improve the complaints process. So I hope that—irrespective of the specifics that we are discussing today—as part of the “closure” that the hon. Gentleman referred to, the improvements in the complaints process in the future will be a source of some comfort to Mr Hawkins.
As part of that process, the complaints improvement partnership was established by the Department and system partners, including NHS England, NHS Improvement, the Care Quality Commission, the Parliamentary and Health Service Ombudsman, and NHS Resolution. That partnership is currently examining options for delivering a more effective complaints management system, and better use of all forms of feedback to improve NHS services. That includes expanding the role of the “freedom to speak up” guardians, to give them powers to initiate whistleblower complaints processes where possible. My predecessor, the hon. Member for Ludlow (Mr Dunne), particularly championed that when he was a Minister, and he did a huge amount to progress it.
The complaints improvement partnership also engages with non-executive directors to explore options for them to have responsibility for monitoring the progress of complaints and serious incidents within trusts, and with Healthwatch England, to empower local healthwatch organisations. As constituency Members, I think we all work with and see the value of that body. Working with the ombudsman, the partnership also promotes best practice in the handling of complaints by providing information, advice and training. In addition, NHS Resolution has recently launched a service to increase the use of mediation in the NHS, to resolve issues at an earlier stage without the need for protracted litigation. My hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) has previously championed reducing the impact of lawyers when disputes arise.
It is important that patients receive the safest care possible from the NHS and that when things go wrong clinicians are open and honest, and able to learn from their mistakes. It is equally important that patients and their families are listened to and their concerns taken seriously and addressed.
Andrew Gwynne
That brings us back to the point made by the hon. Member for Central Suffolk and North Ipswich (Dr Poulter). When Mr Hawkins complained that his Achilles tendon had adhered to the back of his foot again, it surely would have been better for Tameside General Hospital’s old management—the hospital has come a long way since it was in special measures—to investigate and put it right at that point, rather than immediately going down the legal route.
Stephen Barclay
The hon. Gentleman will appreciate that the events took place more than 11 years ago and that it is, therefore, not for me to comment on what the trust knew at that time or their actions accordingly. I think we all, across the House, recognise that resolving issues without recourse to litigation is preferable, where possible, to lawyers being involved at an early stage—and I say that as a former lawyer. That is why the Government seek to improve how complaints are handled, including improving the regulation. The Care Quality Commission now rigorously inspects all trusts and primary and adult care providers, and a duty of candour—a new protection for whistleblowers—encourages staff to speak up for safety and hence fosters greater transparency. There is also the development of a culture of learning, through patient safety collaboratives and the national Sign up to Safety campaign, and last April the healthcare safety investigation branch became a fully operational and independent branch of NHS Improvement, to investigate serious incidents in the NHS with a strong focus on system-wide learning.
Dr Poulter
I do not wish to distract from the main purpose of the debate, but my hon. Friend makes an important point about a culture of openness and transparency in dealing with complaints. How does he feel that the recent High Court judgment about a doctor being struck off by the General Medical Council might play into doctors’ and other healthcare professionals’ willingness to engage with such a culture? Might it be inhibitory, in that they would be concerned about the impact on their future careers of being open and willing to own up to mistakes?
Stephen Barclay
As a former Minister, my hon. Friend knows that there are conventions regarding Ministers of the Crown commenting on court judgments. The Secretary of State has already made clear his position on that matter, and this debate on a specific constituency issue is not the forum for moving beyond that scope.
It is important for us all that we improve the handling of complaints. In a system as large as the NHS, we all recognise that, with the best will in the world, things will go wrong and mistakes will be made. The latest Care Quality Commission annual “State of Care” report, published in October 2017, recognises that the vast majority of patients get good care and that many parts of the NHS have improved thanks to the hard work of the staff. The key issue that the hon. Member for Denton and Reddish has rightly brought before us today is how we learn from things going wrong and how, when a patient thinks something has gone wrong, the issues are aired and resolved.
I commend the hon. Gentleman for securing the debate, notwithstanding his elevated position in the shadow Cabinet, and for ensuring that his constituent’s issues have been aired before the House. The Government are committed to building a learning culture within the NHS that listens to patients and relatives and learns from mistakes, so that patients do not suffer avoidable harm. The Secretary of State deserves great credit for his championing of patient safety as a specific issue within his portfolio. We are also working to improve the complaints handling system so that it is more responsive and joined-up between organisations. I hope that the improvements that are in place will help Mr Hawkins to get some closure on the matters we have debated today.
Andrew Gwynne
I thank the Minister for his kind words and his outlining of how things are changing to give patients better systems through which confidently to seek redress when things go badly wrong. Unfortunately, though, that does not fix the problem for my constituent, Mr Hawkins. He is not looking for a solution. He has exhausted every avenue, as the Minister has set out, and has been badly let down and failed at every stage by a variety of public and private bodies.
My aim today was to set out Mr Hawkins’s case so that Ministers could learn from it in taking forward improvements to the NHS complaints procedures, to ensure that hospital trusts do not play the system to avoid being held properly to account by the ombudsman and other statutory bodies such as the Information Commissioner. My aim was also for Mr Hawkins to feel that the world knew what had happened to him, and to receive assurances that the Government are fully aware of and understand the pain, hurt and concern caused to him for more than a decade, and are intent on putting that right.
Question put and agreed to.
Criminal Justice System: Adults with Autism
(6 years, 10 months ago)
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Kevin Brennan (Cardiff West) (Lab)
I beg to move,
That this House has considered the treatment of adults with autism by the criminal justice system.
It is a great pleasure to serve under your chairmanship, Sir Edward. I am pleased to have secured this debate on a crucial topic that affects the lives of many adults with autism and the families who support them. The debate is about adults with autism and what happens when they come into contact with the criminal justice system.
It is understandable that a lot of focus in this place and elsewhere is given to children with autism—that is right given the need for educational and other support for them, their parents and their families—but autism does not cease to be an issue when someone turns 18 and becomes an adult. Many of the services that might be available for children with autism fall away when they become adults. Parents get older and it is often more difficult for them to cope. Adults with autism face a complex world outside of full-time education where the behaviours and traits associated with autism are often poorly understood, misinterpreted or even sometimes mistaken for criminality. I will say some more about that in due course.
First, I acknowledge the work of the all-party parliamentary group on autism, which has been supported by the National Autistic Society and many other campaigners. That work has resulted in recent positive developments in the criminal justice system for adults with autism. I congratulate the APPG on successfully securing the support of the former prisons Minister, the hon. Member for South West Bedfordshire (Andrew Selous). He wrote to all prisons in England and Wales encouraging them to undertake autism accreditation. Pleasingly, one prison has already been accredited. According to the APPG website, seven more are undergoing that process, but, with well over 100 prisons in England and Wales, there is a long way to go in making further progress.
Recent cases featured in the press, such as that of a young man called Marcus Potter, show that the use of the prison system can exacerbate the condition of those with autism, rather than act in the public interest. The system can cause deep distress and problems. In this case, a young man with an autism diagnosis from the age of three got into trouble for his compulsive filming of the local police. The judge decided to release him from prison, opting for a care plan and probation instead. The judge concluded:
“The worst place for you is where you are”.
There is a lot of work to be done in relation to adults with autism and prisons. There may be Members who want to say something about that in this debate.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Just on that point, I have the privilege of chairing the Westminster Commission on Autism. I do not know whether my hon. Friend saw its recent report on the barriers to healthcare. All these institutions, whether they are in criminal justice, health or whatever, have to give special consideration to people on the autism spectrum. Those environments can be very hostile because of the nature of that challenge.
Kevin Brennan
I congratulate my hon. Friend on the work he is doing on that commission and the work he has done around health. One of the complexities with such a debate on autism relates to the Department that should be answering. I do not think I am giving away any state secrets by saying that I received a phone call from the Government asking, “Which Department do you think should reply to your debate?” I do not blame the Government for that—having been a Minister, I understand how Government works—but one of the key problems is the difficulty in ensuring that services are joined up across the Department of Health and Social Care, the Ministry of Justice, the Attorney General’s Office, the Home Office, the Department for Work and Pensions and the Department for Education. All those things play into each other. Even though today’s debate is specifically about the criminal justice system, it is inevitable that other issues play into it.
Mrs Anne-Marie Trevelyan (Berwick-upon-Tweed) (Con)
Does the hon. Gentleman think it might be worth the Government considering, with Cabinet Office oversight, the creation of something like the covenant and veterans board? That would ensure that every Department had someone absolutely focused on the issue. Autism affects every Department and how we make reforms. Such a board could drive the agenda much more comprehensively through the system.
Kevin Brennan
I think that is an excellent suggestion. In my experience in government, to get Departments working together and to make progress we have to bring Ministers together, not just officials. Those Ministers have to understand and be passionately committed to making the change. It is possible to make significant change simply by ensuring that Ministers are brought together. When I was a Minister, I attempted a joint project with another Minister, and the only way we could get it done was by ensuring that we met regularly. We told our officials, “You will do this, even though it is not currently in the Department’s culture. We are both telling you to do it, and you will work together to do it.” The hon. Lady’s suggestion is excellent, and I hope that the Minister will take it on board. Even if he cannot commit to doing it this afternoon, I hope he will commit to taking it away and discussing it with his colleagues.
Mr Sheerman
Is it not the case that all the institutions have to provide training on people on the autism spectrum? I do not know whether the hon. Gentleman heard reference in the debate last week to Alex Henry. He is an autistic young man. A boy who was with him stabbed someone, and Alex Henry is now in prison for 19 years. He was an easily led young man on the autism spectrum. People on the autism spectrum tend to be quite easily led and are very impressionable. The criminal justice system should be sensitive to the needs of autistic people.
Kevin Brennan
I agree with my hon. Friend. I will come on to talk a little about ensuring that joined-up understanding. The criminal justice system needs to be able to identify and understand the vulnerabilities of people with autism when they come into contact with the criminal justice system.
I was talking about a young man who had been sent to prison. I pointed out that there is a lot of work to be done on adults with autism and prisons. I will not talk further about that today—other Members may want to speak about it—because I want to focus on the earlier stages of the criminal justice system and in particular issues relating to safeguarding and arrest. People with autism can often exhibit specific behaviours that others categorise as unusual, such as stimming, which is a repetitive physical movement that helps reinstate a sense of calm. It is a particular trait of people with autism, and it is rarely understood by others. Indeed, most people I speak to have never even heard of stimming and do not know what it is.
Behaviours that are seen to be unusual can sometimes be misinterpreted as antisocial or, even worse, criminal. Indeed, it has been suggested that those who are the highest functioning on the autism spectrum can often bear the brunt of such misinterpretations as their condition is not otherwise obviously visible. They are not always extended the benefit of the doubt. I hope the Minister will outline his views and what is being done to try to prevent people with autism from being mistakenly criminalised by that misinterpretation of that particular trait. What steps are being taken to ensure that the behaviour of those on the autistic spectrum is not misinterpreted by police and the judiciary?
When adults on the autistic spectrum come under suspicion of criminal behaviour, safeguarding becomes crucial. I want to refer to the case of a constituent of mine, who wishes to remain anonymous for obvious reasons. The safeguards in the criminal justice system did not protect him as they should have under current policy and practice. Owing to his understandable desire not to be named publicly, I will not go too far into the detailed circumstances that led to the arrest of my constituent on two different occasions. I know that Ministers are aware of the details of the case through previous meetings and correspondence. Suffice it to say that his stimming was misinterpreted while travelling in crowded conditions on public transport, and that is what led to his arrest.
My constituent declared his autism before he was arrested, which should have triggered a different pathway from a normal arrest, but he was not diverted or safeguarded at the point of contact as he should have been. On the first occasion, no appropriate adult was called, his parents were not contacted as they should have been, and he was not assessed as fit for interview. A caution was issued against him, which was later quashed due to those lapses in procedure. Unfortunately, he was arrested again three years later, and his vulnerability and protected characteristics were not properly recognised by the police or the health professional who assessed him. In other words, the reasonable adjustments that are required by law were not made during detention or subsequently, and that case was dropped without charge.
In January 2009, Lord Bradley, who is of course a former Member of this House and pays very close attention to these kinds of proceedings, published his review of people with mental health problems or learning disabilities in the criminal justice system. His report set out a policy of liaison and diversion for people with these kinds of issues away from police custody, for assessment by clinicians prior to arrest and custody. I want to be perfectly clear that diversion does not mean not having to answer the allegations; it means that behaviours associated with autism are properly contextualised, that both the accused and the evidence are properly protected, and that an appropriate adult is present. Lord Bradley specified in his report:
“Studies into the use of Appropriate Adults have concluded that provision of the Appropriate Adult is very inconsistent. Firstly, the needs of a defendant have to be identified, which are often missed. Even when a need for an Appropriate Adult is identified there is currently a shortage of individuals who can perform the role effectively.”
My contention is that if Lord Bradley’s recommendations had been properly followed when my constituent was arrested in 2011 and 2014, the trauma that he and his family suffered could have been avoided. My constituents are not the only ones who have had such misunderstandings with the police. The National Autistic Society has said:
“our charity still hears regularly from autistic people and families who say that responding police did not understand autism and did not respond appropriately. This causes unnecessary distress to the individual and to police attending.”
Kevin Brennan
I will in one second. In driving home my point—before my hon. Friend helps me to do so—I want to ask the Minister to go back and look at Lord Bradley’s proposals and ensure that they are being fully implemented across the system. I will now, with great pleasure, give way to my hon. Friend.
Mr Sheerman
My hon. Friend is making such a good speech, which has stimulated me to remind him that the court system very often derides professional opinion about the facts of autism. Professor Baron-Cohen of the University of Cambridge is probably the best-known expert on autism in the country. In the recent case of Lauri Love, who is in danger of being sent to the United States where he will almost certainly be in danger of committing suicide, the professor’s evidence was dismissed out of hand. In fact, he was attacked as an expert when he was in court. Does my hon. Friend agree that professionals who know about autism have been disregarded in a number of cases?
Kevin Brennan
My hon. Friend describes a very distressing phenomenon. Professor Baron-Cohen is one of the world’s experts in this area, and the idea that his evidence would not be taken seriously in an instance such as the one that he describes is obviously highly concerning. I hope that the Minister will consider that, and whether legislation might be required to ensure that the Lord Bradley’s recommendations are followed across the system.
The issues that I am raising today were borne out in a study by the University of Bath, published in 2016. A survey of almost 400 police officers found that only 42% of officers—so a minority of officers—were satisfied with how they had worked with individuals on the autism spectrum. Some 37% of officers had received specific training on how to work with individuals on the autism spectrum, but many found that even that training was not tailored to their specific roles within the police force. In addition, organisation and time constraints were cited as specific barriers, so what assessment has the Minister made of the effects of the continuing cuts to police budgets on the training that is offered to police officers and staff working with adults on the autistic spectrum, and what will he do following the debate to ensure that safeguarding policies are properly put into action across the board?
The National Autistic Society has a free resource aimed at police officers and staff, which offers a guide to working with people on the autistic spectrum. I hope that the Minister will be able to join me in publicly encouraging police services in Wales to use that resource, which is appropriate for Scotland and Northern Ireland as well, and to seriously consider its guidance.
As I said, the allegations against my constituent resulted in a caution that was quashed and in the second instance they were dropped. However, to his great distress, those erroneous allegations remain on police databases. At the time of his arrest, my constituent was living and working across the border in England, not in Cardiff, but the discovery that the allegations against him were kept on police databases, despite the police having acknowledged that they were inaccurate, caused him very severe psychiatric harm, as was confirmed by two separate psychiatric reports. As a result, my constituent ended up giving up his job, flat and independence to return home and live with his parents in Cardiff. We cannot want to see such an outcome for an adult with autism who has established independence and a productive role in society in the workplace. It shows the life-changing effects that a lack of safeguarding can end up having.
The allegations remain on police records. The chief executive of the relevant NHS trust invited both the police and the Independent Police Complaints Commission to send representatives to two meetings to discuss how they could help to protect my constituent from further psychiatric harm. I am sad to say that they did not attend either meeting. Even though extensive and complex complaints have been made to the relevant agencies, those made to the police and the Independent Police Complaints Commission remain unresolved. My constituent and his family have grave concerns about the governance and compliance with required standards demonstrated in the handling of their complaints.
There is no evidence that the police service involved recognised my constituent’s continuing vulnerability, or put in place plans to respond appropriately and safely in the event of further contact with him. In my view, therefore, they neglected to protect him from future risk of harm. Before the first incident, and subsequently, he was studying for a degree and travelling daily on public transport. Before the second incident, he was working full time, but his experiences and, in particular, the failure to remove or amend the allegations resulted, as was predicted by the senior medical consultants who assessed him, in serious impairment of his health and development, with a significant increase in his anxiety and impact on his functioning. As a result, he lost his employment, moved back home and is no longer able to travel independently on public transport.
In pursuing his case, my constituent and his parents have unearthed many worrying inconsistencies. For example, he was originally told by the police that the case against him was not pursued on public interest grounds, whereas the Solicitor General later confirmed that it had been dropped through a lack of evidence. Those are two very different reasons not to prosecute.
Hon. Members will recall the Commons debate on 30 November last year on mental health and suicide in the autism community, in which reference was made to recent research findings that autistic people are nine times more likely to kill themselves than the average population. For people on the autistic spectrum, contact with the criminal justice system can often come at moments of heightened anxiety. As such, it is crucial that all parties are fully informed and trained to find a solution that does not cause undue distress or, in the case of my constituent, severe psychiatric harm.
I urge the Minister to listen to today’s debate and the suggestions from hon. Members. I urge him to speak with his colleagues in the Government to find a way to work in a more joined-up fashion in a ministerial-led initiative, to make sure that what happened to my constituent does not happen to him again, or to others, and to ensure that this country has a reputation across the world for the highest standards in dealing with the issues faced by adults with autism.
John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)
It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate the hon. Member for Cardiff West (Kevin Brennan) on bringing this important issue to Parliament’s attention. I also take the opportunity to congratulate the UK Government and the National Autistic Society on their work in establishing the first autism-accredited prison in the world at Her Majesty’s young offenders institution Feltham, which I understand some hon. Members here today have had the opportunity to visit. I am very proud that the United Kingdom is leading the world on this issue. Facilities such as those at Feltham will be important in rehabilitating offenders, but, more importantly, I hope they will ensure that young people with autism do not have to endure overly distressing sentences that will cause damage to their mental and perhaps even physical health.
I would welcome any moves by the Ministry of Justice and the relevant devolved Governments to increase the number of autism-accredited prisons across the entirety of the United Kingdom. Given that prisoners are more likely than the general population to be autistic, it seems clear to me that we must do all we can to improve autism awareness and support in our prison estate.
Autistic people are more likely to be victims or witnesses of crimes than they are to be perpetrators. I welcome the National Autistic Society’s guidelines to help professionals in such situations, and I hope it will continue to support the hard-working men and women in our police force, prisons and courts systems.
Hon. Members may be aware that the Scottish Government have just finished a consultation on refreshing the Scottish strategy for autism, which will look to address issues across many areas of autism and focus, at least in part, on the criminal justice system. A freedom of information request highlighted by the great research team in the House of Commons showed that, in the National Autistic Society’s opinion, the way the Scottish criminal system looks after autistic people is far from satisfactory—it said that the Scottish criminal justice system is “failing autistic people”. I look forward to reading the findings of the consultation and I hope the Scottish Government will act to ensure that that failure does not continue.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
Will the hon. Gentleman join me in congratulating Police Scotland and Jackton police training school in my constituency? I had the good fortune to visit that facility on Friday last week to hear that mental health training, including autism awareness, has been rolled out to all officers right across Police Scotland.
John Lamont
The hon. Lady highlights an important point. The discussions I have had with my local police force clearly demonstrate that the police and other emergency workers have a much greater understanding of how to deal with the people with autism whom they come across during their work.
It is estimated that there are 58,000 people living with an autism spectrum condition in Scotland. It is vital that they receive fair and inclusive treatment by the criminal justice system, not only when they are suspected of a crime, but when they have witnessed or been a victim of crime. People with autism have an equal part to play in a fair and just society, and it is our job to ensure that they are treated appropriately.
Ms Marie Rimmer (St Helens South and Whiston) (Lab)
It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Cardiff West (Kevin Brennan) on securing this important debate.
Adults with autism experience the criminal justice system in a unique way, which is reflective of the unique and complex way they experience the world and the social, physical and psychological symptoms of their condition, which exist on a broad spectrum. Recent studies have shown that we are all somewhere on that spectrum.
Adults with autism and their individual needs are often not immediately identified on their first contact with the criminal justice system. That has significant consequences for autistic people, both as offenders and victims. The Autism Act 2009 was the first condition-specific legislation of its type in England, and I am proud to say that it was brought in under a Labour Government. The coalition Government’s 2014 “Think Autism” strategy set out two key priorities relating to criminal justice as identified by those with autism and their carers. Those priorities are, in their own words:
“I want the everyday services that I come into contact with to know how to make reasonable adjustments to include me and accept me as I am. I want the staff who work in them to be aware and accepting of autism”
and
“If I break the law, I want the criminal justice system to think about autism and to know how to work well with other services.”
I cannot emphasise enough that adults with autism are much more likely to be victims of crime—seven times more likely—than to be offenders. The National Autistic Society tells of horrific crimes perpetrated against adults with autism, including one autistic man who, aged 21, was harassed, raped and murdered, in part because of his condition. His mother said that
“he was vulnerable and became a target because of his condition, but we weren’t given any help”.
Some 49% of adults with autism in a 2014 survey said they had been abused by someone they thought of as a friend. Autism brings with it an inherent vulnerability to bullying and social exclusion, and we must urgently work to entrench awareness of and respect for it within our society, starting in our schools.
Statistics published by the Office for National Statistics between 2013 and 2016 showed that autistic people were four times more likely to experience disability hate crime than were those with disabilities that affected their stamina, mobility or vision. In other words, there is no empathy for autism. Will the Minister commit to looking at the rise in disability hate crime—it rose 53% between 2015-16 and 2016-17—and exploring how we can tackle this national shame?
Intrinsic to the condition is, generally speaking, a desire to keep to the letter of the law—very much so—but, as in the community as a whole, some adults with autism do commit crime. It is widely accepted that, in the case of autistic people, a significant proportion of crime committed is caused by circumstances that provoke discomfort, fear, or misunderstanding.
The right hon. Member for North Norfolk (Norman Lamb)—the Minister with responsibility for care and support at the time of the “Think Autism” strategy’s publication—said in December last year that we should invest more in keeping people with mental health conditions, learning disabilities and autism out of our prisons altogether. I absolutely agree.
The National Autistic Society also agrees with that assessment, and it stated that
“for many autistic people, prison has meant that the system has already failed”.
This is not always possible, but will the Minister commit to exploring the equivalent of autism accreditation for the criminal justice system in its entirety, from the point of exposure to exit? That means looking at what reasonable adjustments can be made throughout the system from the moment the police are called—including the quick-fire questions at interview—and people’s appearance in court, detention in prison and rehabilitation.
The most prevalent problem appears to be in policing, which is most people’s first point of contact with the criminal justice system. A 2016 study showed that seven out of 10 adults with autism were dissatisfied by their experience with the police and reported discrimination, a lack of clarity and a feeling that their needs were not met. The “Think Autism” strategy tasks the College of Policing with developing autism awareness training for new recruits. I welcome that move, but responding police across the board must be trained so they understand that when they identify someone who may have autism, they must respect that person’s needs.
Wailing sirens, loud noises, being touched and being shouted at are experiences that, combined, lead to sensory overload for most adults with autism. In those circumstances, the behaviour of people with autism, such as stimming, can easily be misinterpreted as aggression. Ensuring that the police are uniformly educated about autism is without doubt the key to preventing excessive distress and unnecessary violence. I urge the Minister to take steps to ensure that all police, no matter their length of service, have the autism understanding that they need.
People with autism may also be seen as unreliable witnesses, because stress may alter their behaviour in the courtroom, and the often literal nature of their responses may not be conducive to effective self-advocacy or to providing an account of events that happened to others. Since 1999, it has been legally possible, at the court’s discretion, to identify people as vulnerable and to adapt proceedings accordingly, but I understand that that is done infrequently and does not reflect the number of vulnerable people who pass through our courts.
Jim Shannon (Strangford) (DUP)
I congratulate the hon. Lady on raising that matter. This is not just about prison officers, the court service and the prison service; it is about recognising issues early in the process. If we do that, we can address the issues further down the line, and if people with autism are distressed by what they are going through, we can put their minds at rest.
Ms Rimmer
I accept that point. It should start with policing and go right through the system with the individual.
I welcome the recent progress that has enabled witnesses on the autistic spectrum to request a registered intermediary to help judges and lawyers to phrase their questions more appropriately. Will the Minister consider enforcing the universal implementation of those measures to make our courts more accessible for vulnerable people? Much more can be done to educate legal experts about the complexities of autism to reduce the possibility of miscarriages of justice and to avoid putting autistic witnesses under undue stress.
Social attitudes research shows that some jurors still hold stigmatising beliefs about autistic individuals, which could negatively impact their decisions regarding such people at trial. Given that only 16% of autistic people and their families believe that the wider community understand their disability, it is likely that that is a systemic issue in criminal justice.
I want to focus on the “Think Autism” objective of effective joint working. In the Government’s 2016 progress report on “Think Autism”, only 11% of local authorities gave themselves a green rating for their work on autism with the criminal justice system. That rating was based on the inclusion of people with autism in developing local criminal justice diversion schemes, involvement in the autism partnership board and evidence of joint working. I am deeply concerned about those figures. I understand that the Government are reviewing the strategy next year, and I will be pleased to hear about any progress.
The all-party group on autism hosted a meeting on criminal justice in 2014 with the then prisons Minister, from which the pioneering autism accreditation scheme arose. The first prison to be autism accredited was Her Majesty’s prison and young offenders institution Feltham in 2016. The standards for accreditation apply to prisons’ education, health and mental health services, and they cover autism understanding, training for staff, adjustments to the prison building—such as reducing the stimulation of posters and notices—changes to prison routines and individual risk assessments. They were developed by the National Autistic Society, which is now working with other prisons in the country to help them to achieve accreditation.
I was pleased to hear that, as of April 2017, accreditation programme pilots have been trialled in the probation service. That is undoubtedly progress. It will lead not only to the implementation of the practical steps needed to become accredited, but to an accompanying cultural change that will generate a greater awareness of autistic people’s needs and improve the perception of autistic people. That will lead to a greater understanding and acceptance of who they are.
In the meantime, adequate autism-specific training must be made available for all prison staff and police. Much more research needs to be carried out in this field. Awareness needs to be raised across the board about the fact that adults with autism experience things differently and, crucially, that those differences are not experienced uniformly.
It is clear that inroads are being made, but the progress is not quick enough for the adults with autism who have been let down by our criminal justice system. I urge the Minister to bring about change. Prison is an inhuman setting, but for adults with autism it is far more severe, and their route to prison often leads to severe distress. We need to bring about a societal change in attitudes, through awareness-raising and a concerted effort by the justice system. I believe that that is the key to generating a lasting improvement in autistic adults’ experience of criminal justice.
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
It is a pleasure to serve under your chairmanship for the first time, Sir Edward.
I came to the subject of autism rather late in life; I will share with hon. Members the tale of my visit to a remote primary school in Caithness a number of years ago. There was a boy, probably aged about 12, who was deeply engrossed in making an Airfix Halifax bomber. Anxious to impress him, I said, “That bomber’s a Halifax. It has Merlin engines”—the subtext was, “Aren’t I clever to know that?” The boy looked at me and said, “Yes, it’s a Merlin XX with Stanley Hooker superchargers and a brake horsepower of 1,240.” As my jaw sagged, the teacher murmured in my ear—you know what I am going to say, Sir Edward—“Asperger’s.”
Even though I was then in my 40s, that was the first time I had come across the condition. Part of the reason why I am here for this debate is that this is a learning process. I am sure hon. Members will recall the book—published in 2004, I think—called “The Curious Incident of the Dog in the Night-time”. Medical professionals and experts in autism might say that it is not an accurate depiction of autism, but as a view from the inside of the person, it was very instructive to all of us, and I was glad that it became a big seller.
The debate is about awareness of the issue. I did not know what “stimming” meant until I got into the subject, but I now know. I can remember being irritated by somebody on a bus doing exactly that. When I look back I feel ashamed because I should have understood. The Marcus Potter story was scary, although it turned out right in the end. It shows how close we are sometimes to things going wrong, but the judge did a very good thing.
The hon. Member for Berwick-upon-Tweed (Mrs Trevelyan), who is no longer in her place, made a good point when she suggested the idea of a link person in Government Departments. It would not cost particularly anything, but it would go a long way to—this is a hackneyed expression—a joined-up approach to sorting things out.
The hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) correctly intervened to point out that Police Scotland are up to speed on this matter. I am not always known for heaping praise on the Scottish Government, but I cannot fault them on this at all. The issue is difficult for some people, but they have not ducked it. I am not saying that the UK Government are ducking it. That is not my intention. I would not try to paint them into such a corner.
Jim Shannon
The hon. Gentleman is making some pertinent points. Following the Autism Act (Northern Ireland) 2011, the Northern Ireland Assembly has been taking great strides in implementing an autism strategy, including the production of a guide for criminal justice professionals and the piloting of a registered intermediary scheme. Does the hon. Gentleman agree that the good practice—the Minister is listening—that we have in Northern Ireland, Scotland and Wales could be used for the benefit of all in the United Kingdom of Great Britain and Northern Ireland? The Minister should look to the Northern Ireland Assembly and its autism strategy as one example of how we could all do things better.
Jamie Stone
I have no problem with that intervention whatever.
On the school that I visited in Caithness, the care lavished on the pupil was inspirational. The teachers looked after him properly in a splendid example of best practice.
I am slipping out of the habit, or no longer getting away with saying, “As a new Member”, because I have been here for seven months and it is wearing a bit thin. I realise that. The fact that a Member can go to, listen to and learn things from debates is a great strength of this place. I will leave this debate a wiser person. That is good for me and, in terms of representation of the people, good for constituents. I absolutely applaud the hon. Member for Cardiff West (Kevin Brennan) for bringing us this debate today. Well done! Well said!
Angela Crawley (Lanark and Hamilton East) (SNP)
It is a pleasure to serve under your chairship, Sir Edward. I thank the hon. Member for Cardiff West (Kevin Brennan) for securing this debate and I thank the Members who have brought to the attention of the House the issues that their constituents with autism face within the criminal justice system.
Autism covers a wide and variable spectrum, so it is important not to over-generalise. The experience of each individual is different within the criminal justice system, and those with autism are no exception. However, it is true that autistic people are more likely to be victims and witnesses of crime than offenders. They experience difficulties with social communication, social interaction and social imagination, and may have sensory difficulties and some co-ordination problems. Their behaviour may present differently and sometimes draw unnecessary attention, but in general autism is a hidden disability and it may not be immediately obvious to other people that the person has a disability. Dealing with the criminal justice system in any capacity is therefore much harder for a person with autism.
I will sum up some of the contributions made today. The hon. Member for Cardiff West has outdone himself, and I commend him for giving a voice to his constituent’s experience and advocating much-needed changes to the criminal justice system. The hon. Member for St Helens South and Whiston (Ms Rimmer) identified the rise in hate crime, particularly of those who have a disability, and the need to train and support people differently. The hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont) identified failures in process across the criminal justice system, both in Scotland and in the UK. The hon. Member for Strangford (Jim Shannon), as always, raised a valuable point about the need to share best practice and to look to the autism strategies in Scotland and Northern Ireland. The early recognition, identification and training of professionals who work in such sectors can only enhance the experience of those who suffer from autism and have to undergo the treatment of the criminal justice system.
As mentioned earlier, the Scottish Government published the Scottish strategy for autism in 2011. It contained 26 recommendations, including four under the overarching theme of developing multi-agency working. A consultation ran from 18 October 2017 to 29 November 2017 to refresh the 2011 strategy, which was much needed. It proposed the inclusion of a provision to consult with bodies, including in the criminal justice system, to improve how people with autism are met within the services. That is something that can be learned across all parts of the UK. I hope the Minister will take that on board.
The pace of change within the criminal justice system, as I am sure the Minister will agree, is not fast enough given the medical understanding and the variability of the understanding of autism. The National Autistic Society goes as far as to say that the criminal justice system is failing those with autism, and it calls for that to be urgently addressed. Many aspects of the criminal justice system are worthy of review. I hope that the treatment of adults with autism will be given the same consideration in this debate.
Carolyn Harris (Swansea East) (Lab)
It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Cardiff West (Kevin Brennan) on securing this important debate.
Let us be clear. Autistic people are discriminated against in society as a whole, but especially in the criminal justice system. They can face discrimination when their autism is not readily apparent, or no help is offered. Where it is apparent, they are often treated differently or suspiciously. Autistic people without a learning disability are nine times more likely to die by suicide than the rest of the population. That figure is considerably high and shows the lack of understanding and awareness of the needs of people with autism.
On occasions when an autistic person comes to the attention of the police and other services, it is normally because their social and communication difficulties are misunderstood or they have not been given appropriate support. Autistic people can become extremely distressed in situations that they do not understand or when they are surrounded by noise and confusion. In such circumstances, their actions and behaviour can easily be misinterpreted and subsequent actions may escalate a situation.
The criminal justice system needs to reform and adapt in order to meet its fundamental human rights obligations to treat people fairly and equitably. The National Autistic Society developed its autism accreditation scheme for prison settings. Accreditation covers autism understanding training for prison staff such as guards, but is also more widely helping to make the prison environment more autism friendly. Accreditation should be extended to all prisons, all detention centres, all courts and all police stations, as well as to the probation service. The duty must be on the prisons and courts and their individual officers to ensure the fair treatment of those in contact with the criminal justice system. Individual officers could also be accredited. There should be a requirement for at least one key individual in central functions to be accredited: for example, duty sergeants or clerks of the court.
Accreditation recognises good practice, which helps ensure that people on the autistic spectrum get the extra support needed to adjust to life in prison, and extra support while they serve a sentence, or as they prepare for leaving prison. Without that support, autistic people may develop additional needs such as mental health problems or risky behaviour, and rehabilitation will be harder. Greater awareness and support will benefit autistic people as well as prison staff, police officers and managers in that area of work. Expert opinion is clear that autism sufferers need special and sensitive treatment, especially in a stressful criminal justice environment.
Kevin Brennan
I am grateful to my hon. Friend for the way she is responding to the debate. What she just said has triggered a thought, and I want to quote a comment made by someone in the professional standards department of the police service about the complaint by my constituent. It begins:
“I’ve read this several times and they just don’t get it do they”
and notes that my constituents “continue to maintain” that their son
“should have been ‘diverted’ prior to arrest. What utter rubbish!”
If that is the continuing attitude in the police, does my hon. Friend agree that we have a long way to go to get things right?
Carolyn Harris
We certainly do have a long way to go, and what my hon. Friends have said emphasises what we all know: we need to look at autism as a special consideration.
For many autistic people, prison means the system has failed. Work must be done with probation services and police forces to create a specification for autism accreditation in those settings. That will help to prevent autistic adults from entering the criminal justice system in the first place and it will certainly help with rehabilitation. More training and support must be given to initial responders to crime, including those working with witnesses and victims. Initial contact with the police will often come at a time of heightened anxiety, so it is important that the police know how to approach such a situation and how not to allow it to escalate.
Thangam Debbonaire (Bristol West) (Lab)
Does my hon. Friend agree that training for police officers in that situation would help them to prevent reoffending or revictimisation? I think that our colleagues in the police share the aim of reducing those things.
Carolyn Harris
It is certainly my experience, from talking to police officers, that they would appreciate training so that they could better understand the condition, and how to deal with autistic offenders. That understanding is vital for the criminal justice system. If we are to regard people with autism in a fair and equal way we must look at how we provide for their needs. I am sure that the Minister has listened to the wise words spoken by many colleagues today, and that he will offer us some hope that the Government will consider the issue and treat it with some urgency.
The Minister for Policing and the Fire Service (Mr Nick Hurd)
It is a great pleasure to serve under your chairmanship again, Sir Edward. I offer my sincere congratulations to the hon. Member for Cardiff West (Kevin Brennan)—not just on securing the debate but on how he presented the subject. I had the great pleasure of shadowing him when he adorned the last Labour Government as Minister for the Third Sector, and the sincerity and thoughtfulness of his approach to this sensitive subject today is entirely characteristic of him. I also congratulate other hon. Members who contributed to the debate.
I am entirely with the relatively new hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone): I have sat through enough rubbish debates in this place to know a good one. The good debates are the ones we leave having learned something. I shall be frank: the subject on which I am asked to speak today is not one of which I have a deeply rooted, strong understanding. I shall leave the Chamber better informed. A good debate should also be a catalyst for action by Ministers, and further probing. Ministers are trained to try to exude an aura of all-knowingness, which the hon. Member for Cardiff West knows to be a total fallacy.
I shall try to reassure the hon. Gentleman, and other hon. Members who spoke, that there is recognition of one big central point. Since I became an MP in 2005, this country, society and Parliament have made undeniable progress in our understanding and awareness—the central word—of autism, autistic people’s needs, and the consequences of what the hon. Member for Huddersfield (Mr Sheerman) described as an often hostile environment. Despite that progress, however, the clear message from the debate, through individual anecdotes and voices from all parts of the United Kingdom, is that there is still insufficient awareness and understanding.
My hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont) made clear his view that there is still much to be done in Scotland, as there is elsewhere, but we have heard from all parts of the UK in the debate, which creates a powerful message. The fact that there is insufficient awareness and understanding can sometimes lead to unreasonable judgments and decisions, which in turn can lead to trauma. That can mean extremely traumatic experiences for not just the individual involved but their family. The hon. Member for Cardiff West respected the desire for anonymity in the case he raised, but the debate springs from his experience of trying to serve a constituent, so I begin with the acknowledgement, with which I think everyone agrees, that there is clearly some way to go.
The hon. Gentleman, drawing on his experience as a Minister, clearly understood that there are a number of Ministers who could have represented the Government in the debate. It was his fate to get the Home Office, so inevitably what I shall say will focus primarily on the first point of contact in the criminal justice system. However, I give him and other hon. Members an undertaking that, based on what I have heard, I will speak directly to the new Prisons Minister, my hon. Friend the Member for Penrith and The Border (Rory Stewart), to test his understanding and his appetite to follow up on specific requests—not least the desire to encourage other prisons to follow the example of the one in the constituency of my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk, and to continue down the path of accreditation.
We need to recognise that autism is believed to affect about 1% of the population, which makes it highly likely that police officers will encounter people with autism in the course of their duties. It would not be appropriate for me to comment on the specifics of the case that the hon. Member for Cardiff West raised, but it is quite clear from his account, and the fact that charges were dropped, that mistakes were made in that process, and that the experience has had a profound effect on the individual and the family. I am sure that the House would want to associate itself with the regret expressed for that outcome.
However, I hope that the hon. Gentleman will acknowledge as a general point that police officers are often called on to make decisions in difficult circumstances. They have a difficult job and often have to act swiftly to protect individuals or the public more generally. He knows that: we all do. They also have a duty to investigate alleged offences, especially where there are alleged victims. Given the nature of autism, brilliantly articulated in the debate, it is also possible that at times the actions of some individuals with the condition may be mistaken for unco-operative or even aggressive behaviour. Again, I do not infer that that was necessarily the case in the specific instance that the hon. Gentleman referred to, but it is clearly a risk, and it happens.
Mr Sheerman
We are all on a learning curve today. Back in the mists of time, I was Roy Hattersley’s deputy as a shadow Police and Prisons Minister, so we all have our learning curve. Does the Minister agree that the real change that has happened recently, for all sorts of reasons, has been a great improvement in the joining up of children’s services, running across all services? As my hon. Friend the Member for Cardiff West said, we have got much better when it comes to children. It is with adults that we seem to have difficulty.
Mr Hurd
The hon. Gentleman makes a reasonable point. We have made considerable progress and the hon. Member for Cardiff West was at pains to point out at the beginning of his remarks that he wanted to focus on adults, because clearly that is where some stubborn and significant problems continue to reside in terms of awareness, understanding, decisions, judgments and treatment. We cannot be complacent. I hope that I can reassure the House that we will take all possible steps to improve the general understanding and responses appropriate within the criminal justice agencies.
The hon. Member for Cardiff West pressed me on training, and I will speak a little to that. He is no doubt aware that the Government have published a national strategy on autism—I think he referred to the “Think Autism” strategy; that was refreshed in January 2016. It sets out a programme of work across Government sectors to improve preventive action and support to those living with autism, to assist them to lead fulfilling and independent lives wherever possible. It included recommendations for further improvements in the services and support available across the health, education employment and criminal justice sectors.
The hon. Gentleman cited cuts to the police, but the budget of the College of Policing has not been cut, because of our strong commitment to the training and development of police officers. As part of the strategy, the college has committed to developing a new module of the authorised professional practice for the police service. That was included in the revised guidance on mental health and vulnerability, published in October 2016.
The guidance is the primary reference source for police on legal obligations and the appropriate response to incidents involving people with mental ill health, autism, learning disabilities and other vulnerabilities. It provides indicators for police staff about when there may be health or mental health issues underlying apparent behaviour. That can and should lead to better and more appropriate decision making. Guidance is backed by training modules for all staff who may come into contact with vulnerable people. In addition, the National Autistic Society—I join others in congratulating it, the APPG and the Westminster Commission on Autism on their work—has published a national guide for police officers and staff, which has been distributed to all forces. In many areas there is close liaison between police forces and local autism support groups.
I give this undertaking to the hon. Member for Cardiff West. The College of Policing, which is the agency we rely on for the development of police standards and training, is under the new leadership of Mike Cunningham. I undertake to write to Mike following this debate to set out some of the concerns expressed here and to seek reassurance from the college that those are understood and absorbed and that it attributes sufficient weight and importance to this issue.
Thangam Debbonaire
I am pleased to hear the commitment to encourage the national College of Policing about its training. Will the Minister make the clear point to the college and to police officers that we respect what they do and we know how hard their job is? This is not about special pleading for a particular group but about ensuring genuine access to justice, which means that some people will need different treatment to achieve an equal outcome. If people with autism are to be treated equally and fairly in the criminal justice system, that might sometimes—not always—mean different treatment, which has to come from better awareness. Better awareness can only improve police responses and, as I said, I genuinely believe that the police want to reduce unnecessary reoffending and re-victimisation. Will he make that commitment?
Mr Hurd
I agree with the hon. Lady. My experience of talking to police officers—this is the universal theme—is that they want to do the job properly. They do a very difficult job and need the tools to help them in that job.
Our fundamental challenge is the one expressed in this debate: that levels of awareness and understanding are too low. Our responsibility is to help police officers do what is natural to them—to do their job properly and safeguard the vulnerable where they can, but to play their part in executing swift justice as well. Clearly, the process of education, understanding and awareness building has to continue and does not end. I undertake to seek reassurances from the new leadership of the college that they understand that.
The police and other agencies continue to explore innovative solutions to help support those in the community with autism with daily interactions or official contact. In some areas, autism alert cards are available to be carried by those who are autistic. Locally developed systems may include additional information about the person and contact details of family members or other carers. In other areas, similar results are achieved through autism apps held on mobile telephones. Apps can include information such as carer details and the user’s coping mechanisms, as well as useful links to external support sites. So technology can be our friend, but there is no substitute for the training and guidance we talked about.
I will say a word about police detention, because that has been a difficult and emotive subject. If the police encounter a person who appears to be mentally disordered and in immediate need of care and control, it is open to them to exercise powers under section 136 of the Mental Health Act 1983 to take such a person to a place of safety for a mental health assessment. Use of such powers might be appropriate in the case of a person with autism, depending on individual circumstances, and might be preferred over an arrest, again depending on precise circumstances. New legislative provisions, however, provide that police officers should consult a mental health professional before exercising such powers, where that is practicable. That is intended to ensure that the most appropriate decisions are made in each case, in particular where the person may already be in contact with local health or social support services.
If an offence is alleged to have been committed, however, or the person needs to be dealt with through the criminal justice system, notwithstanding any underlying health factors, an arrest may be necessary and appropriate. Under the Police and Criminal Evidence Act 1984, codes set out the safeguards that need to be in place for any individual in custody, with particular provisions in respect of the most vulnerable.
Forces are expected to have available easy-read documents using simple language and pictures to show what will happen while those people are in custody. The hon. Member for Cardiff West talked about the need for appropriate adults in situations where such provision might not have been in place. We are clear that an appropriate adult is required to be present in cases involving children or vulnerable adults, including those with autism, during procedures such as being given information on rights, detention reviews, interviews and taking of any evidence. He rightly pressed me about the Government’s response to Lord Bradley’s report—I assure the hon. Gentleman that we have taken the report very seriously, and there is a programme of action on the various recommendations.
The hon. Gentleman may be aware that liaison and diversion schemes now operate in police stations and courts across some 80% of England. Work continues on how best to ensure that appropriate adults are available when required. A working group of the PACE strategy board has been developing an approach to improving provision throughout the country. That involved partnership work between police and crime commissioners and local authorities. The work is expected to be completed and published soon.
Mr Sheerman
We are coming to a very sensitive part of the Minister’s speech. I am sure he will turn to the international dimension. Has he any update for us on the Lauri Love case? Many of us in Parliament are fighting to save that young man from being taken to the United States, to a hostile environment, where he might well commit suicide.
Mr Hurd
The short answer is no, I am not in a position to give an update to the House on that, but of course I completely understand its sensitivity. An announcement will be made in due course.
I was trying to give reassurance to the hon. Member for Cardiff West, who prompted this debate, about measures taken to ensure greater provision of appropriate adults. I was saying that liaison and diversion schemes operate in police stations and courts in about 80% of England. Such schemes help to assess individual vulnerabilities and any underlying mental health, autism or learning disabilities issues. They can further assist with referring the person to an appropriate health or welfare assessment if necessary, as well as helping to inform the most appropriate charging decision or sentencing outcome.
The hon. Gentleman mentioned that the family in his constituency case were frustrated with the complaints procedure. Let me say something briefly about that. If individuals are unhappy about their treatment by the police, there are avenues of complaint. Individuals may complain directly to the relevant police force, or they can raise a matter with their local police and crime commissioner. Complaints that include serious and sensitive matters such as assault or serious corruption must be referred directly by the police to the Independent Office for Police Conduct. Police and crime commissioners maintain an overview of complaints about the police and they are democratically elected to hold the chief constable to account for the performance of the force, on behalf of the public.
There is a further right to appeal against how a complaint has been handled by the police. Depending on the nature of the complaint, it will be made either to the chief constable or to the Independent Office for Police Conduct, formerly the Independent Police Complaints Commission.
Kevin Brennan
I know that this is not directly the Minister’s responsibility at the Home Office, but it seems that there is a gap in the accountability chain in relation to the British Transport police, because it is paid for by the train operating companies and does not have an elected police and crime commissioner. Will the Minister talk with his ministerial colleagues about whether there are ways in which we can improve the accountability of the British Transport police?
Mr Hurd
The hon. Gentleman makes a reasonable point. I will certainly assume that undertaking and I will communicate back to him the consequences.
The police complaints process is a very sensitive area for the public and for the police. The IOPC is under a new chief executive, Michael Lockwood, whom I will write to after the debate to register some of the concerns expressed so that they are on his radar screen as he assumes leadership of that organisation.
I congratulate the hon. Gentleman on securing this debate, which has allowed me to raise my own awareness of some of the underlying difficulties and experiences of our fellow citizens. The treatment that they receive in our public service, whether in the criminal justice system or the health system, is quite unacceptable. That remains a challenge for us as a society and for Governments of all colours. I have tried to reassure colleagues that we have done much in recent years to improve awareness of and understanding about people who have what initially may be invisible vulnerabilities, such as autism, but doubtless much more can be done. The Government have demonstrated their commitment to improving protections for the wellbeing of the potentially vulnerable, including in the criminal justice system.
I made various undertakings in the debate, which I will honour despite whatever advice I receive after the debate. I congratulate everyone who has contributed; debates such as this will ensure that the issue remains high on the agenda. I have seen it rise since I have been in Parliament, but it is only through the persistence of the APPG, Members and various criticisms from the National Autistic Society that this point continues to be pressed, meaning that more Members come out of these debates with increased awareness of the importance of the issue.
Kevin Brennan
I am grateful to have a brief opportunity to respond. I thank everyone who has participated in the debate. More than one Member pointed out that it has been a learning curve for everyone present; I include myself among them. It is a subject on which we all can learn more and we would benefit from learning more about autism. In particular, I thank all colleagues who contributed with a speech or an intervention.
I hope that as many as possible attend tomorrow’s debate brought by my hon. Friend the Member for Bristol West (Thangam Debbonaire) on another aspect of autism, which reinforces the point that I made at the outset: this is a subject that permeates across different parts of Government. That highlights the need for Ministers to do what the Minister has promised—to work with each other and perhaps to consider some of the suggestions made in the debate in a more formal way, in order to tackle the issue of autism across all Government Departments. If he chooses to do that along with his colleagues, he will certainly have my support and I am sure that of my hon. Friends as well.
I thank the Minister for his response. He referred to the brief period when I was radiant with lawful power all those years ago, and when he was my shadow—I am now a shadow of my former self. During his remarks at the end of the debate, I saw his officials’ ears prick up when he said that he was going to carry out what he had promised to do, whatever advice he received. I say to his officials that he is a free-range, organic Minister, rather than a battery-farmed one. He is never satisfied to just read out his brief from his civil servants, but will listen and try to act. Having had praise lavished on him, he now has to fulfil all the things he pledged to do in the debate: to follow up with other Ministers, to ensure that he gets the College of Policing on the case, and to take on board my point about the British Transport police and the IOPC. I am glad that he will engage with the new leadership at the IOPC.
I absolutely concur with the Minister about some of the great work that our police officers do in very difficult circumstances, but there are occasions when, either through lack of training or in some cases through poor practice, things go wrong. We are here to hold them to account while acknowledging the incredible work they do under the most difficult circumstances.
I thank the Minister for the sincerity with which he has responded to the debate and his promises that he will take things further and learn more about all this. Finally, I thank all the people with autism and their families across the country for their tremendous forbearance under very difficult circumstances, and for how they cope with what can be a very difficult situation in their lives. I hope that the debate will genuinely help to move things forward and to make a difference.
Question put and agreed to.
Resolved,
That this House has considered the treatment of adults with autism by the criminal justice system.
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Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
I beg to move,
That this House has considered youth activities and sport within the Erasmus Plus programme.
I applied for the debate, as chair of the all-party parliamentary group on youth affairs and former vice-president of the European youth forum, for two main reasons. The first is the big issue hanging over us in almost every decision we make in this place at the moment: Brexit. How will we continue to co-operate with EU programmes after departure day? The Minister for Universities has stated that the Government intend to negotiate some sort of continued access with Erasmus Plus and its successor. However, the Government’s intentions remain unclear on the youth elements of the programme that are part of Erasmus now but may be separated post-2020 in the next EU multiannual financial framework, which is being negotiated.
I note that it will be much easier to continue co-operation in higher education—most exchanges there are bilateral in nature—than it will be in youth and sport, where exchange and co-operation are primarily based on multilateral partnerships, making the arrangements all the more complicated. I remain concerned that when people talk about Erasmus, they are generally speaking about the university sector. When I tried to secure this debate, I was asked multiple times whether the Department for Digital, Culture, Media and Sport was the correct Department to respond. The Universities Minister has given assurances about the Erasmus programme but not wider assurances about its youth and sport sections, and particularly how our policy on youth and sport will feed into an Erasmus successor programme. That is why I am here.
Alex Sobel (Leeds North West) (Lab/Co-op)
As my hon. Friend said, the Erasmus sport programme is not just for universities. One of the Barking Abbey sports academy programmes is a basketball programme. As chair of the all-party parliamentary group on basketball, I am proud that 35 basketball apprentices undertook an exchange with the Basketball Federation of Madrid. Sixty-five per cent of Barking Abbey students are from black and minority ethnic communities. Does he agree that the loss of such a programme would be detrimental not just to sport, but to BME communities in the UK?
Lloyd Russell-Moyle
Totally. I will talk later about how the youth and sport programmes are far more diverse than some of the university parts of the Erasmus Plus programme. The continued participation of black, Asian and minority ethnic communities and other harder-to-reach or economically deprived communities in parts of those programmes is really important. We need to think about not just our continued participation in the Erasmus programme but, generally, how we will continue to co-operate with our European partners on youth policy and sport policy.
Erasmus has secured a place in people’s minds as a university programme—600,000 people from the UK have gone abroad to study in the past 30 years—but there are similar numbers in the youth programme. It is vital to highlight the importance of youth and sport in Erasmus Plus. What are the policy views of DCMS about how that programme should look? Additionally, how will our current domestic programmes intertwine and co-operate with a future Erasmus programme? How will the International Citizen Service and National Citizen Service work in harmony with any future European programmes? How will UK Sport’s international development through excellence and leadership in sport programme continue to work with the sport section of Erasmus Plus?
The sport part of the programme is a good example. More than 10,000 people have taken part in the youth and sport section alone in the past year, while the IDEALS programme has an average uptake of 46 young people. Those are different programmes, but the scale of Erasmus’s youth and sport section outweighs any of our domestic programmes. That is why it is so important that our involvement continues. The current programme runs from 2014 to 2020, so it is in its final half. We await the independent mid-term evaluation report, which was completed in August 2017 and is sitting on desks in the Commission in Brussels. We all want to see what the official report—rather than the drafts—will say.
I have spoken at length to several national agencies and to the evaluation team who wrote the report on EU youth and sport policy. What role is the UK playing to ensure that we lead those discussions? If we are to buy into Erasmus Plus and its successor programmes, we want to ensure that they meet our needs, so we need to roll our sleeves up and get involved in the nitty-gritty of the debate and discussions. If we are to remain in Erasmus, we must ensure that it is in line with our youth policy. That would be much easier to do if we had had the youth strategy that the Government promised before the election. I understand that there will now be a youth chapter in the civil society policy. It is important that we are clear about our policies so that we can influence our European colleagues.
From conversations with colleagues in Ukraine last night, I understand that the Ukrainian authorities tried to opt into only part of the Erasmus programme—interestingly, the youth and sport part, not the university part—but they were rebuffed by the Commission, who said that it is all or nothing; they could not start to take programmes apart. That makes it clear that if we took part, we would be in not just the university section, but the youth and sport section. It is, therefore, even more important that we inform the design of the youth section based on our policies.
What vision do the Minister and the Government have for the content? Erasmus Plus has policy themes based particularly around economic policy, because the current programme was designed in the wake of the economic crash to get young people back into economic activity. Issues of social inclusion and radicalisation have now come to the fore. How will those issues, which I assume the Government will want to tackle, be reflected in a new programme? What are the Government’s priorities?
Additionally, in the latest Commission proposal, it looks as though the European Voluntary Service for Europe and neighbouring countries—in a crude way, I guess it is our equivalent of ICS—will be taken out of Erasmus. The EVS has existed for 20 years, so it is not a new programme, and we have participated in it for all that time. It will be merged into a new European solidarity corps—or, as most of my European colleagues rather unfortunately pronounce it, “corpse”—and how that corps complements NCS and ICS will be really important. Do the Government intend to opt into the new European solidary corps? We have had reassurances about opting into the Erasmus programme, and the European solidarity corps will be a successor, but it will not be part of Erasmus. Do the Government intend to commit to continuing in all successor components of Erasmus Plus, or will we continue only with the core of Erasmus, with everything else still up for question?
Erasmus is the name of the programme we have at the moment, but it was not always thus. Before 2014, there was a separate youth programme, Youth in Action, and before that the EU Youth Programme. There were Comenius, Grundtvig and Leonardo—I could go on with the other European philosophers. Erasmus was chosen in conversations we had with the Commission. I was not in favour of it at the time; in fact, I argued heavily against it when I was in Brussels.
The idea was that everyone knew Erasmus, so we might as well try to make everything Erasmus. In my view, doing so just waters down the other bits of the programme that are not really known about, but that is the direction that the Commission went in. Now it looks as though the Commission is moving towards separating parts of those programmes back out into a solidarity corps, and it would be interesting to know the position of the UK Government and the Minister. Are we supportive of those plans to split out again? How are we having those discussions in Europe?
The higher education sector has a high success rate in achieving Erasmus funding; 90% plus of Erasmus funding is successful in that sector. In the youth sector, it is around the 30%-plus mark. I sat on the European programming committee in a previous life, and the evaluators often state that the youth programmes are just as well written, but they are written by volunteers. It is the same with the sports programme; we are often talking about voluntary sports clubs rather than big, professional HE institutions. How will our influence be brought to bear on the Commission and the discussions in the Council to ensure that the future programmes, and particularly the solidarity corps, are flexible, light-touch programmes to which voluntary groups and small organisations can apply?
One of the outcomes, as I understand it, of the mid-term evaluation is that smaller organisations have been pushed out by the bigger merger. There are other advantages to merging everything into one, and I do not particularly want to get into them all, but it is important to recognise that smaller organisations, which we want to encourage and foster, are at a disadvantage in an integrated programme. I hope that we will welcome the European Commission’s direction.
The only reasons we managed to secure a separate section for youth in the Erasmus programme were the heavy lobbying work from youth organisations, which I helped to co-ordinate, and detailed discussions with Commissioner Vassiliou, who was the commissioner at the time. I wonder whether the Minister has considered, in her discussions with youth organisations, the importance of including the voices of youth and youth organisations in the programme.
Equally, it would be interesting to include the voices of stakeholders such as Scottish, Welsh and Northern Ireland colleagues. The matter is generally devolved, but we represent the whole UK in the discussions. I am aware that the Belgian authorities take their counterparts with them to Council meetings. The Belgian authorities have no problem with having all their regional Ministers sitting behind them. Are we considering something similar, particularly on these important devolved matters—on sports and youth—to ensure that those voices are included?
I will give some numbers quickly before I finish. I have asked several questions that I hope to hear back on. Erasmus, of course, is a good programme. Some 16,000 higher education students took part last year, and 10,000 youth and sports groups, but only 11% of the money is distributed to youth and sport programmes—1% for sport and 10% for youth. That surely shows the efficiency of the youth and sports programme. The cost per head of a participant in the youth part of the Erasmus programme is €900 or thereabouts. The cost of participating in the Erasmus higher education programme is €2,500 within Europe; if participants take the Erasmus option of going to a neighbouring non-EU country such as Norway or the Russian Federation, it is €5,000 per participant.
There is nothing wrong with investing in students who go into higher education, but the majority of students who take part in the Erasmus higher education programme are from more privileged backgrounds, by the nature of the fact that they have gone to university and then chosen to opt out. As I have mentioned, more than 50% of those on the youth programme come from the most disadvantaged backgrounds. It is important that we continue to opt in and have a voice. A stack of case studies is available on the websites of the British Council and the UK national agency about how the programme—particularly EVS—has turned young people’s lives around, and I implore hon. Members to look at them.
When I was chair of Woodcraft Folk, a national voluntary youth organisation, I applied for those grants and saw this at first hand. I remember a young person from County Durham who came to the programme with very anti-immigrant views. By the end of it, after doing exchanges and working with other young people from across Europe, his views were totally transformed because he was able to see the value of humanity in all of us. That is what I hope this Government will do, by continuing to engage in the programme and by giving a strong commitment that we will continue not only in Erasmus, but in the solidarity corps and the European Voluntary Service substitute.
The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Tracey Crouch)
As always, it is a pleasure to serve under your chairmanship, Mr Hollobone. I will start by thanking the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle) for calling this debate on such an important issue. It is the first time I have had the pleasure of being in a debate with him and seeing him in action and, if I may say so, his enthusiasm is infectious. I will take the opportunity to suggest that we continue the conversation beyond this Chamber. He has raised a number of questions that I fear I will not be able to answer entirely in this debate, but we will certainly write to him afterwards, and it would be helpful to have a continuing conversation within the Department.
I understand that the hon. Gentleman has previously participated, as he suggested in his speech, in Youth Voice and Erasmus activities, and therefore brings personal experience and knowledge to the debate. His story is exactly what the Government’s support of the UK Youth Parliament and investment in our youth and sports programme are striving to achieve. We want to encourage young people to take part from an early age and continue making their voices heard and their impact felt throughout their lives. The Erasmus offer is an important part of that process.
Hon. Members may well be aware of Erasmus, possibly through a similar personal experience of the highly popular university year abroad, but the remit of Erasmus, as we have just heard, goes beyond the traditional university language experiences into youth and sport-related opportunities. The Department for Education is the national authority for the whole Erasmus programme, while the Department for Digital, Culture, Media and Sport is responsible for policy on wider youth and sport opportunities. It gives me great pleasure to be the Minister responding to the hon. Gentleman’s debate today.
Erasmus is a European funding programme for education, youth, training and sport, funded from the EU core budget to the tune of €15 billion over its seven-year duration through to 2020. Organisations delivering Erasmus offer activities in a number of areas. First, it enables individuals to undertake work experience, job shadowing and volunteering. Secondly, the programme allows organisations to form strategic partnerships with EU organisations, and thirdly, it provides opportunities for individuals to influence policy reform through dialogue with EU decision-makers.
The sport element of Erasmus is administered centrally in Brussels and is much smaller than the youth element—it pains me to say that—but it is nevertheless important, with organisations able to bid for projects to improve grassroots sports provision, tackle cross-border threats such as doping and match-fixing, and increase inclusion and promote sport for all, which is the issue that the hon. Member for Leeds North West (Alex Sobel) referred to in connection with funding in basketball.
According to the European Commission’s impact report, Erasmus youth projects bring measurable benefits for young people, in terms of self-esteem, self-confidence and a sense of purpose. Participants also identify improved access to employment as a result of their experience.
Colin Clark (Gordon) (Con)
Scottish universities have benefited greatly from the Erasmus Plus scheme; Edinburgh University sends several hundred students a year, Aberdeen University sends 200 and receives 250 and Robert Gordon University concentrates on technology. The programme is not exclusive to EU countries. Will my hon. Friend confirm that the UK will continue to participate in the programme after Brexit?
Tracey Crouch
My hon. Friend is absolutely right that the programme is not exclusive to EU countries. As I will go on to point out, we have made a commitment to Erasmus for up to 2020. However, on the key point of the question raised by the hon. Member for Brighton, Kemptown, which I will answer later, no decisions have yet been taken on post-2020. That is all part of phase 2 of the negotiations.
The UK has a good track record of benefiting from Erasmus funding. From the start of the current programme in 2014 until 2017, there have been successful applicants from 928 youth projects, funded to a total of €41.6 million. Those figures will rise, as they do not include the final round of youth funding for 2017. Roughly 12,000 young people and 4,000 youth workers participate each year, with the latter benefiting from job attachments, training and other professional development activities. In 2016, the UK received grant funding of more than €2 million awarded to 51 organisations for collaborative sport partnerships.
However, Erasmus youth and sport is so much more than those statistics. To bring that to life, I will share some examples of projects funded by the programme. Erasmus funding allowed the UK to participate in structured dialogue activities, which give young people a voice on issues that matter to them, such as combating discrimination and equalising opportunity. The UK already has a powerful track record of Youth Voice activities through the annual Make Your Mark process—the largest ballot of youth views in the UK—and the Youth Parliament, which I think the hon. Member for Brighton, Kemptown and I both managed to contribute to at the end of last year.
Structured dialogue builds on that theme and encourages young people from across the UK to influence the future direction of EU youth policy through dialogue with EU decision makers. The British Youth Council co-ordinates young ambassadors’ roles in the presidency-run EU youth conference and EU youth strategy. Finally, the UK was awarded a grant from the sport fund by the European Commission for the delivery of the European Week of Sport in the UK in 2017. The programme was co-ordinated by the not-for-profit health body, ukactive, and took place in September. More than 5.2 million young people got active, either at one of the official events or after being inspired by the week—especially on its flagship National Fitness Day on 26 September, which I was proud to participate in myself.
Beyond Erasmus, the Government continue to support young people to realise their potential outside school; Members will be familiar with programmes such as the National Citizen Service and our support for the #iwill campaign to encourage young people to build their skills for life and give back to their communities through social action. The Government are also committed to ensuring that all children and young people, particularly those who are currently least active or from under-represented groups, have the best opportunities to engage in sport and physical activity. I have spoken many times on the sports strategy, published in December 2015, which sets out how important it is for children to make sport and physical activity a habit for life.
I will turn to some of the key issues raised by the hon. Member for Brighton, Kemptown. We have heard questions about the future of UK participation in Erasmus after we exit the European Union. The Government have already stated publicly that the UK is committed to continuing full participation in the Erasmus programme up until we leave the European Union. We have now agreed a fair financial settlement with the EU, enabling us to move to the next stage of negotiations.
The Prime Minister said in Brussels in December that she was pleased to confirm that, under the agreement made on 8 December, the UK would participate in Erasmus until the end of the programme—up until 2020. She also welcomed the opportunity to provide clarity to young people and the youth and education sectors, and to reaffirm the UK’s commitment to the deep and special relationship we want to build with the EU. However, no decisions have yet been made about post-2020 programme participation, since the scope of that programme has not been agreed. Options for that will be discussed as part of phase 2 of the negotiations.
Carol Monaghan (Glasgow North West) (SNP)
The young people hoping to participate in these programmes are making their plans now and are choosing universities or organisations, depending on how they want to participate. Does the Minister therefore agree that there is some urgency in getting the issue resolved?
Tracey Crouch
I understand that proposals will be published later this year—in May, I think—that will allow us to take the next decisions on that. However, as the programme has yet to be designed, it is difficult to decide what our participation in that will be. We look forward to the Commission publishing its proposals, based on which we can make that decision.
The hon. Member for Brighton, Kemptown asked about the European solidarity corps, which is the new European Voluntary Service for young people. It expands the existing EVS to include an occupational element of a job placement or a traineeship. Discussions on the solidarity corps legal base remain ongoing and are expected to conclude later this year. As I am sure he will completely understand, we cannot commit to participating in the scheme until the final version of the regulation has been shared and we have assessed the extent to which it is in line with UK policies. However, we remain supportive of international initiatives for young people—especially those focused on encouraging social action and collaboration between young people from different backgrounds.
I am absolutely delighted to have been given the opportunity to respond to the debate and to reassure the hon. Gentleman about our commitment to wider sporting and social action programmes for young people. We wish to bring the Erasmus programme further to life, and I draw hon. Members’ attention to the Shaping Futures exhibition that will run in the House of Commons exhibition space from 26 February to 1 March. The exhibition will share the impact of the Erasmus programme in the UK and stories from individuals whose lives have been changed by their participation. I urge colleagues to take some time to view the exhibition and find out even more about the programme. I thank all the individuals and organisations that have supported young people to take part in Erasmus for their commitment and dedication to the programme.
Question put and agreed to.
Town and Village Plans
(6 years, 10 months ago)
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George Freeman (Mid Norfolk) (Con)
I beg to move,
That this House has considered town and village plans.
I thank my hon. Friend the Minister for being here and for his support in the past few days as we prepared for the debate, and I thank colleagues for turning up in numbers to intervene and contribute.
I am here today to highlight a problem that we are experiencing in my constituency of Mid Norfolk and that I am aware colleagues are also experiencing. The problem is essentially that the promise of the Localism Act 2011—supported, I think, by all Government Members and probably by the whole House—is, on the ground in Mid Norfolk, being failed by what I suggest is an either accidental or deliberate, but none the less clear, exploitation of the well-intended five-year land supply rules; those were meant to ensure that councils could not put out a plan and then ignore it.
The rules are being exploited, through a legal loophole, by big out-of-town volume house builders, which are banking permissions that are clearly there in areas where the councils and communities sensibly want to build, in order to take the opportunity to force through developments in areas where one would not sensibly want to build.
John Howell (Henley) (Con)
Does my hon. Friend share my delight and enthusiasm about the recent decision of the High Court to accept the reduction of the five-year housing land supply to a three-year housing land supply, where there is a neighbourhood plan and where sites are allocated?
George Freeman
I absolutely welcome that and will in due course list some of the very good things that the Government have been doing to try to help. I am here today to flag a problem and offer the Minister some suggestions to try to help find a solution.
At its heart, this is about the difference between rural and urban planning; in government, in Parliament, we tend to legislate as if the two are the same. In my patch, Mid Norfolk, we could build many more houses if we were able to get the essence of the localism promise right—build where we want, build how we want, build for local people as well as those moving into the area, and build in a way that supports the grassroots. I am talking about development being seen to be done by and for communities, not to communities by those far away.
There is real frustration in Mid Norfolk; I would be lying if I said that this was not the No. 1 issue in the recent election. In fact, in that election campaign, I promised to come to Parliament, talk to colleagues and Ministers, and see whether we could find a way to deal with it.
If I may, I will briefly set the scene by setting out my very strong support for the Localism Act and for what the Government have been trying to do in promoting a much more bottom-up model of local planning; by signalling where I think the national planning policy framework has helped but is also hindering in relation to the five-year land supply; and by describing some of what is going on in Mid Norfolk at the moment and some ideas about how we might deal with it.
When the Localism Act was introduced, the then coalition Government were stunned by the level of support for it. The Minister, like me, welcomed it strongly, because in essence it says that development is something that should be owned and valued by local communities. Despite the previous Government’s well intended desire to get houses built, we took the view that it was a flawed approach to sit in London and allocate numbers by region, by county, by district, and that numbers allocated from London were unlikely to motivate the towns, villages and communities that we wanted to embrace development. Instead, we said, “No, the better way is to ensure that every area has to put together a local plan.”
There is no number for Mid Norfolk in some filing cabinet in Whitehall, which I am delighted about. My area and colleagues’ areas have to put together their own local plans, taking into account their own population dynamics and economy, and put out a 20-year plan. To prevent councils from simply doing the plan but not actually building, the five-year land supply was introduced to ensure that houses were actually built, in accordance with the plan.
Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)
I congratulate my hon. Friend on securing the debate. Does he agree that the value of the local plan is that it also has regard to local infrastructure needs, potentially at village level? The current loopholes that are being exploited see developers coming forward with plans for wholescale, 300 or 400-house developments without that infrastructure, which are against the interests of many of our villages in Suffolk and Norfolk.
George Freeman
My hon. Friend makes the very point that I will be making. This is about infrastructure and public services. A proper plan is not just about houses, but about the community, its needs, the public services, the infrastructure, the drainage and so on. Like many colleagues, I welcomed the Localism Act. I could understand when the former Chancellor of the Exchequer introduced the national planning policy framework, with its presumption in favour of sustainable development, to shift the balance, particularly at a time when the housing market was on its knees, and to encourage the building of the necessary houses and the development that we needed. The five-year land supply makes logical sense. We do not want a nimby’s charter, which allows councils to plan and then ignore their own plan.
However, what is happening in Mid Norfolk is giving the lie to that promise. For those of us who backed and supported localism, it is beginning to undermine public trust, and not just trust in the local planning system and support for development. It is beginning to foster the very nimbyism that was not there before and, even worse, is beginning to foster, complicate and compound a distrust in political promises. That is damaging to the planning system at a time when we really need proper strategic planning and local support.
If you will indulge me for a moment, Mr Hollobone, I would like to paint a picture of where Mid Norfolk sits. I know that that has worried colleagues since I arrived in the House eight years ago—it has worried quite a lot of my constituents. As it was a new constituency, most of my constituents were for several years asking, “Where is Mid Norfolk?” It sits right in the heart of God’s county. People who are used to going to the coast will drive past and around my beautiful patch, and those who drive up the newly dualled A11 to Norwich will leave my patch to port of their journey. People need to be in search of the real, the authentic, the heart, the glinting jewel in the crown to come and find Mid Norfolk; it sits right in the middle, at the heart of our county. It is not a place that someone would need to go to unless they were looking for it.
In Mid Norfolk, we have four magnificent towns: Dereham, Wymondham, Attleborough and Watton. Attleborough and Wymondham are both on the A11, just south of Norwich. Norwich is growing very fast. The Norwich research park is booming. All credit to the Government for their fantastic support through the industrial strategy and the support for small businesses. In many ways, Norwich is becoming a mini Cambridge, which is only 40 miles down the newly dualled A11. Indeed, when the Government have opened up the Ely junction and made half-hourly the rail service, Norwich will become part of a Greater Cambridge cluster. That is why there is such housing demand along that corridor. There are 15,000-odd houses going in at Ely, 5,000 at Brandon, 5,000 at Thetford, 4,000 at Attleborough and 2,000 at Wymondham. It is a corridor of growth.
For that reason, my local council wisely suggested that the bulk of its housing target should be placed on that A11 corridor, where the rail and road links support the cluster of development. Unfortunately, however, the developers, cognisant that they have those permissions and that allocation there, have taken the opportunity of the five-year land supply to begin to do what they would not normally be able to do: dump very substantial, large-scale commuter housing estates on a number of the villages close to Norwich in my constituency, without, as my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) mentioned, the necessary investment in services and infrastructure.
Dereham, which I like to think of as the gateway to the Norwich research triangle—it has not yet gripped that strategic role for itself, but over the next 10 to 20 years it will become that—is now becoming in the morning a traffic jam, almost as visible from space as the Cambridge traffic jam. The developers are now piling into south Dereham, along the main roads. It is the classic model of putting the big housing on the road, where it is easy, without any infrastructure. A string of villages between Dereham and Norwich—Yaxham, Mattishall and Swanton Morley—have all found themselves the subject of aggressive, large-scale, out-of-town developments.
In each case, the villages have been working on putting together their own village plans, taking the powers that we gave them in the Localism Act; the idea was that local neighbourhood plans would be put together and that the local plan adopted by the council would be an amalgamation of those and work around them. In fact, what has happened is that the local communities have put together plans—I want to talk in a moment about the Swanton Morley plan in particular—and then that process of going through a neighbourhood plan has, as we might have predicted, led to a strong conversation locally about the community’s needs, such as jobs and services. In every case, that has led to more houses being suggested by the local council than were originally thought of.
Therein lies the beautiful truth at the heart of the Localism Act: if we empower communities to think about their own futures, most will end up planning development where they want it, in the style they want it, for their own vision of their own community. People are not naturally nimbys, but they are resistant to growth being dumped on them by a remote bureaucracy, whether it is in Brussels or London.
Jim Shannon (Strangford) (DUP)
I am very encouraged by what the hon. Gentleman says. Back home in my constituency, the local Ards and North Down Borough Council has initiated a new idea—the very thing that he refers to—of village regeneration. It is village regenerating with village, with town, with village; it is a domino effect where we all get together. Out of those plans have come some very forward-thinking ideas for economic expansion, house building and how villages can interact with each other. If we do it right with consultation, we get agreement and we are always better off.
George Freeman
Not for the first time the hon. Gentleman makes my point better than I. He is absolutely right that if we get this right, and if we trust people in communities and empower them, which is what the Localism Act was about, we will be surprised by what communities can do. There are wonderful examples of that around the country, including in Northern Ireland. That is why I am optimistic. I know the Minister is keen to stretch every sinew to ensure that we are able to unlock this and get the houses that we want built.
I appreciate that colleagues represent different areas with different circumstances, but if the Minister said to me, “Can you find a way in which we could build the houses that we need in East Anglia?” the answer from my part of the world would be, “Absolutely!” Let us build a really serious new town—a proper new town—and design something that we could be really proud of. We might even have a couple. Given the housing demand in the south-east of England, one might even say that every county could probably find somewhere to build a stunning new town. We could even make it a competition and see who comes up with the most beautiful one. We could build a new town with proper energy-efficient houses and modern transport. We could make our new towns the test beds of the modern-living technologies that we are developing in this country.
I will give a location for a new town in my patch. On the Cambridge-Norwich railway, where RAF Lakenheath and RAF Mildenhall sit adjacent, Lakenheath is a tiny town, with a lot of poverty and deprivation, on former peat that has gone to grade 3 clay. It is a town aching for investment. It is on that railway and would not be 25 minutes from Cambridge. We could build the most stunning town there, possibly on the former airfield, and ease a lot of the pressure on our villages.
I am not saying that because I do not want development. In my patch we could build, and I am pushing a project to build, a garden village on the old Beeching railway line from Wymondham to Dereham. I am working with local developers to see whether we might come up with a model where we can plough the profit from the development back in, in conjunction with the railway company, to create a new model development company, with housing and rail linked in the way that it was by the Victorians. The Government are pushing that model forward in East West Rail.
I pay tribute to the work of the Secretary of State for Transport, who is clear that he wants that Oxford to Cambridge east-west railway not to be a traditional model of slow, bureaucratic franchising and competing interests, but a development company that lays the track, builds the houses and captures the value of housing gain to recycle into public transport.
Paul Masterton (East Renfrewshire) (Con)
I thank my hon. Friend for giving way and apologise for interrupting his flow. The Scottish Conservatives would like to see between six and eight new towns built in Scotland. Is not the heart of the issue about bringing people with us? As well as following the ambition of the post-war generation in building new towns, we must learn from their mistakes in design and infrastructure. We must make sure that these new towns fit with their environments, so that the communities surrounding the developments can support them and feel that they have been listened to.
George Freeman
I could not agree more with my hon. Friend. We should look at the lessons from those garden towns. Many years ago, I fought the constituency of Stevenage—as colleagues know, it fought back—but Letchworth, the first garden town, is still regarded in that part of the world as a great tribute to proper planning. It is a place of great pride for the people who live in and around it. That is unusual for new developments, so there are real lessons to be learned.
I know the Government are supportive of this model of new town development and of garden village development, but the problem is that it is not happening. Seven years after we passed the Localism Act, when I say “localism” in Mid Norfolk I am greeted with groans and occasionally with jeers—although my constituents are very well-behaved and extremely polite. There was the promise of localism, where we said to people, “You will be empowered. The community will be able to plan. We will support your plans and back you.” But people are seeing their plans ignored.
I want to mention Swanton Morley as a case study. Swanton Morley is the home of the Queen’s Dragoon Guards, and formerly of the Light Dragoons. It has an old RAF base. It is one of my small market towns with a 2,000-odd population, and it has put together a magnificent plan. I want to pay tribute to Roger Atterwill, the chair of the parish council, and Faye, his assistant, who have worked assiduously on the plan over the past two or three years. It is a model of local planning. There were village hall meetings, consultations, surveys—real engagement—and they have produced a real vision for the future of the village.
But unfortunately, on examination, the examiner appointed by the district council struck out all of their sensible, local conditions, such as that there should be an allocation of houses for people who come from the Swanton Morley area and around the percentage of affordable housing, all of which were provided for in the spirit of the Localism Act and in legislation. One cannot help but see that they were struck out because the main planning authority, Breckland Council, has both hands tied behind its back. It is up against the wall with a five-year land supply and it has no leg to stand on: it is terrified of being taken to court by big out-of-town developers.
I want to make it clear that I am not having a go at all developers. There are some magnificent developers in this country and in Norfolk. I would cite Tony Abel, for example. Abel Homes is a really good local business, building high-quality local developments. However, when it comes to the likes of Gladman, which has come into our patch, we never meet the people behind the developments.
Sir Nicholas Soames (Mid Sussex) (Con)
I entirely agree with my hon. Friend’s point, which he is making so well. In my constituency, the local builders are immaculately behaved, do a very good job and try very hard. But some of the big builders’ behaviour is frankly atrocious. They game the system, cheat the people who they are meant to be working for and bully the district council. Their behaviour is often absolutely reprehensible.
George Freeman
I am grateful to my venerable and right hon. Friend for putting that so robustly. I would not be here if I did not share that view. We all understand that we need houses built, and we all know that we need developers to do it, but there is a contract. When we provide developers with the powers and the balance of probability on the sustainable development framework, and we say that there is a presumption in favour of sustainable development, we mean sustainable development. We do not mean that as an excuse for them to dump a housing estate on our villages and towns and then sugar off. They have an obligation, as local builders and local landowners understand.
For that reason, I recently called a rural housing summit with Hastoe Housing Association—I see the Minister nodding—which is a leading, if not the leading, rural housing specialist. All around the country it has put together schemes with the support of local communities. It is doing more than anyone in rural housing to defeat nimbyism, because the quality of its developments is so high. At this rural housing summit we showcased best practice from all round the country: people putting together affordable housing schemes, shared equity schemes, covenanted land, parish councils. There is a wonderful cornucopia of good rural housing models, but we are not seeing it in Norfolk because our councils have both hands tied behind their backs.
When I say to my councillors, “Why aren’t you using the design codes that we gave you? Why aren’t you using the powers that we have given you in these Acts?” the answer comes back, “We are desperate to get our five-year land supply in order. We are terrified of legal challenge. We are trying to keep our council tax down. We are bearing the brunt of very necessary public spending constraints, and frankly every penny we make goes back into the deficit.” Our councils have their hands tied behind their backs, and are therefore unable to implement the spirit of the Localism Act.
Sir Hugo Swire (East Devon) (Con)
Is my hon. Friend not concerned that the whole thrust, which is understandable from the local councillor’s point of view, is towards economic growth, as otherwise they do not get the funding? So they are all being encouraged to go at a speed that perhaps they would do well not to go at.
George Freeman
My right hon. Friend makes the perfect point. He is absolutely right, and that is happening in my patch as well as in his.
I am conscious that others want to speak. I want to give them a chance to do so and the Minister a chance to respond. To sum up my opening speech, we all know that we need to build houses, but as with so many problems that is a challenge in London. I have been a Minister pulling the ministerial levers, and I know that there is a big problem to be solved in the corridors of Whitehall.
However, in our constituencies, the problem is smaller, more manageable and easier to deal with. In Mid Norfolk, I see the answer to a problem that is very big in the Minister’s in-tray. If we can revisit the spirit of localism, re-empower local communities and re-incentivise councils to retain and harness the benefits of growth and put them into local infrastructure, we will restore faith in the planning system and deliver more growth, not less.
Several hon. Members rose—
Mr Philip Hollobone (in the Chair)
Order. I must call the Front-Bench speakers at 8 minutes past 5. The guideline limits are five minutes for the Scottish National party, five minutes for Her Majesty’s Opposition, 10 minutes for the Minister and then a couple of minutes at the end for our Member in charge to sum up. There are six Members seeking to speak, so I am afraid that in order to get you all in, speeches will be limited to two minutes 45 seconds. If there are any interventions, some of you will not make it.
Dr David Drew (Stroud) (Lab/Co-op)
I am delighted to serve under your chairmanship, Mr Hollobone, and I congratulate the hon. Member for Mid Norfolk (George Freeman). I will try to keep to my three minutes or less. I take a particular interest in this issue; I was a parish and town councillor for 28 years. I have taken through village appraisals and village plans, and I almost took through a neighbourhood plan. It is quite an awesome thing to be asked to participate in.
I make no apologies for being a long-standing member of the Campaign to Protect Rural England; I declare that interest. I will largely ask the Minister about points that CPRE has brought to the debate. CPRE wants to critique four issues relating to neighbourhood plans. First, where do they sit in relation to strategic planning, if there is such a thing nowadays? Secondly, there is a lack of resources for taking plans through. Thirdly, there is unnecessary complexity; I personally share that concern. Fourthly, there are issues with conformity and precedents.
The CPRE asks clearly for the Government to at least reconsider the idea of the neighbourhood right to be heard. It is frustrating, when a plan has been developed, for a development to undermine it completely or for the plan to be ignored because the development has gone through without any real ability to influence it. It is important that we consider that.
I have always been a critic of referendums. I know that 89% of referendums have been successful, but I believe in democracy. I was a parish councillor, and as my old friend the late Stephen Wright said to me, that is the first level of democracy. Why should it have referendums foisted upon it? I think that we have all learned the lesson that referendums are not terribly good for our system of democracy, so I am a critic of that idea.
We need to tease out where neighbourhood plans sit and what influence they have. There are some glaring examples of things not working very well. In terms of the Neighbourhood Planning Act 2017, we should look again at where the plans are and give them some robustness, so that they mean something when they go into the planning system and so that the people who spent a lot of time getting them through can feel confident that they will be listened to.
Nick Herbert (Arundel and South Downs) (Con)
First, I say to the Minister that this is not about opposition to housing. In West Sussex as a whole, when I was first elected, the draft south-east plan proposed an amount of housing far below what is now being built under the new system. The objectively assessed need for West Sussex produces 66% more houses than the draft south-east plan, and the new formula will produce nearly double the draft south-east plan. It is placing massive pressure on local infrastructure.
As my hon. Friend the Member for Mid Norfolk (George Freeman) said so well, neighbourhood plans produce more houses by consent. If we allow neighbourhood plans to be bust, then we undermine the principle of consent, and in the end, fewer houses will be built by consent. That leads us to only one policy—the imposition of housing, which will be massively unpopular.
The Minister must understand that developers are gaming the system. They are ensuring that five-year land supplies are not adequate. Consequently, neighbourhood plans—either in draft form or, worse, when they are made and approved by large referendums—are being broken through. Some of the solution lies in his hands. The Government produced a helpful improvement to the situation last year, but his predecessor refused to entertain call-ins or appeals. When the Minister comes to take any decisions that might be in the balance, he must be mindful of the importance of supporting the neighbourhood planning process.
In the end, the Government face a fundamental choice. They can hold to the Localism Act 2011, a flagship policy that empowered local communities and gave them responsibility, including for decisions about where to locate housing. We are now in a difficult position; public faith in the policy of localism is being gravely undermined by people’s feeling that developers are simply overriding neighbourhood plans or that the Government apply rules that are too tight and do not recognise the power of giving local communities the control that they should have.
John Howell (Henley) (Con)
I helped invent neighbourhood plans, and I am the Government’s neighbourhood planning champion. It is exciting to see neighbourhood plans, as my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said, produce more housing than they were asked to produce. If we look at it in contractual terms, they have gone beyond the contract set up.
What happens when a village decides to produce a neighbourhood plan? First, it needs to see whether the district council has a five-year land supply. This morning, I happened to be with a number of people considering development in the Thames valley. They produced a map of district councils that do and do not have a five-year housing land supply. It is unfortunate that so many district councils do not. That leaves them open, the moment they put down their name to make a neighbourhood plan, to developers moving in ahead of the plan to take advantage. I have asked in an Adjournment debate that when someone seriously puts their name down to start a neighbourhood plan, no more housing should be built until it has come to fruition, so that it can be taken fully into account.
I agree totally with what colleagues have said about certain firms of developers, such as Gladman, which aggressively game the system, as it has been described. It was partly to overcome that that a Planning Minister two Ministers before this one, Gavin Barwell, decided to reduce the land supply figure from five years, because people did not have a five-year land supply, to three years, for a two-year period from the end of the neighbourhood plan where sites were allocated. That was challenged in the High Court and, as I said in an intervention, the recent decision, in a very detailed judgment, has confirmed it. We are still waiting to see whether it goes to appeal, but the chances are that it will not.
The Government are tightening up the national planning policy framework, and it is about time. All I would say is that the presumption in favour of sustainable development is not itself new; it has been there since the beginning of planning. The only thing that is new is the word “sustainable”.
Neil O'Brien (Harborough) (Con)
Neighbourhood planning is a hugely important reform. In my constituency, I have seen the way that it brings people together. We have neighbourhood plans in five parishes: Foxton, Great Glen, Kibworth, Lubenham and North Kilworth. I congratulate all the people who have selflessly given their time to make them happen and who have taken part in those referendums.
To make neighbourhood planning work, we now need a new approach. First, we need much greater legal force for plans shortly before their adoption. It was extremely frustrating for people in Great Glen to do all the work of putting together a neighbourhood plan, only to find that just before it came into force, the developer put a new development on exactly the site that they did not want it to go on.
Secondly, we need far less interference from the planning inspector. I have no problem with planning inspectors casting their eye over neighbourhood plans, but they must not interfere with matters that are, frankly, none of their business.
Thirdly, we need a simpler, clearer and quicker process so that developers cannot get their foot in the door. Often, neighbourhood plans have a lot of things in them that they do not need, but not the one thing that they do need: a simple map of where the community does and does not want development.
In the long term, I would like communities to have much stronger powers. Other hon. Members have already made reference to the virtues of planned and coherent new development over piecemeal bits tacked on to the ends of villages. I agree with that sentiment. I would like neighbourhood plans to be able to call in compulsory purchase powers from their local authority. Too often, villages such as Great Bowden would like to develop a site that a developer is simply sitting on, so developments have to be tacked on to the village in all directions instead, which people hate.
Neighbourhood planning is incredibly important. People can behave responsibly: they come forward with sites and they back more housing in their community. We must not let this important reform die or be gradually picked apart by rapacious developers such as Gladman.
Sir Hugo Swire (East Devon) (Con)
The Minister is a man on the rise—one can only be amazed at his great trajectory—and he will want to make his mark on the Department before he moves on to higher office. In the nicest and most collegiate way, I suggest that he listens carefully to what hon. Members say. I echo every word uttered by my hon. Friend the Member for Mid Norfolk (George Freeman), who instigated this timely debate.
I urge one note of caution to my hon. Friend, who wants a new town. Just as he said, I wanted Cranbrook to be an exemplar of towns around the world, but soon the developers moved in. I am afraid that the council is now having to move in to put in the town centre because the developers are behaving in a shameful way; they say that not enough people live there to put it in. It is a classic example of big developers gaming the system.
It is not brain surgery. My hon. Friend made the point that if someone builds good housing, which we all need, in the vernacular to enhance local communities, they will be amazed by the silence that follows—by the congratulations that follow in the pub. People want their communities to be enhanced. They want to support the village school, the post office and other local services. They do not want huge blocks of developments.
The big developers have worked out how to make profit down to the square inch, so they do not care if they are not nodding to the local vernacular or if a house looks the same in the north of England, the middle of England and Wales. They just want to make a profit. I hope that the Minister will be as good as the Government’s word and tell us how we can encourage local house builders, who often produce a far better product than larger house builders.
I draw the Minister’s attention to what other hon. Members have said about neighbourhood plans. Budleigh Salterton and East Budleigh with Bicton have produced wonderful neighbourhood plans, which can be expensive and time-consuming. Lympstone also produced one. The Minister’s predecessor received a letter from me in October about a constituent who said that, despite Lympstone identifying the type and design of housing that the community wished to see, it had singularly failed to achieve them in the two years since the plan was made. That letter also singularly failed to be acknowledged, although I prompted the Minister on 15 January. I ask him to look at that.
The neighbourhood plan is a contract with our constituents. We persuaded them that if they were going to be more local, they would have a say. At the moment, they feel that they have wasted their time and they are being ignored.
Sir Nicholas Soames (Mid Sussex) (Con)
Unlike my right hon. Friend the Member for East Devon (Sir Hugo Swire), I am not in the least bit surprised about the Minister’s trajectory. I know that he will be paying careful attention to what is said today. I congratulate my hon. Friend the Member for Mid Norfolk (George Freeman) on his speech and I agree with every word. Indeed, I agree with all my hon. Friends. I will make four brief points.
First, I endorse what my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said. Neighbourhood plans will produce more houses by consent than anyone believes is possible, hence the importance of sticking to the system.
Secondly, the integrity of the system is vital. Local people spend hundreds and hundreds of hours of their own free will making a great effort to produce these plans, and it is vital that they are honoured. I am encouraged by the point made by my hon. Friend the Member for Henley (John Howell) that the national planning policy framework needs to be strengthened. I would welcome that.
Thirdly, I say again—it cannot be said too often—that the behaviour of some major developers is appalling. It traduces our constituents and our constituencies, our elected councillors and our district councils. It is the kind of behaviour up with which the Government should not put.
Finally, if people are prepared to spend all that time and effort on producing something very important to them, those efforts should be respected in all honour. My right hon. Friend the Member for Arundel and South Downs and I have difficulties in that regard, but as he said, it is important that those efforts are honoured and that the Government play a straight bat with local communities.
Mr Philip Hollobone (in the Chair)
There are five minutes for the Scottish National party spokesperson and five minutes for the official Opposition spokesperson.
Alison Thewliss (Glasgow Central) (SNP)
It is a pleasure to sum up for the Scottish National party in this debate, and I thank the hon. Member for Mid Norfolk (George Freeman) for introducing it. From a Scottish perspective, it has been very interesting for me to see how things work slightly differently in England.
The SNP is looking at reforming the planning system in Scotland to pick up on some of the things that do not work as intended. We have ambitions to build 50,000 affordable homes by 2021. We have brought in the Community Empowerment (Scotland) Act 2015, which gives local communities a community right to buy so that they can influence what gets built and how land is used in their community. That is important in rural and urban settings.
We have 20 proposals for revamping the planning system in Scotland. Many things that the hon. Member for Mid Norfolk spoke about, such as action by and for communities and putting infrastructure in place, are reflected in those plans. The consultation process on the planning system is called “Places, People and Planning”, and it is all those things—people are at the heart of making places work.
We also have ambitions to align our system of community planning, which has been going for some years, with spatial planning. That reflects what the hon. Member for Henley (John Howell) and the right hon. Member for Mid Sussex (Sir Nicholas Soames) said about the need for integrity—people’s views should be respected as part of the planning process.
There is a real need in Scotland to remove some of the complexity. In 2007, not long after I became a councillor, Glasgow was looking at city plan 2, which was one huge folder with another huge folder of supplementary items. It was very complex, and it was difficult for people to get their heads around it and understand the land use. Almost as soon as it was produced, things had moved on and changed. The 2008 crash then changed many people’s views about how land should be used in communities.
In the Scottish system, we think that people should have the opportunity to plan their own place and that people should be involved in planning. The community aspect is important, as is improving public trust. In Scotland, we are approaching that through pre-application consultations. Before a planning application is submitted to a local authority, the developer has to go and speak to the local community, sound people out and figure out whether its proposal will be acceptable. That is very important and has been quite successful in changing some aspects of that process. My council colleague Norman MacLeod was at one of those events in a part of the constituency that we share, where the developers were presenting all these two-bedroom flats in Pollokshields. Councillor MacLeod said, “There are large families in the area, who will want larger family homes.” That had not crossed the developers’ minds. Having that negotiation before developments are built is a better way to get them right.
The hon. Member for Mid Norfolk mentioned his ambitions for new towns in his constituency. That is an interesting prospect, but issues arise about how those new towns would be paid for. Would they be paid for by the developer? If the developer decided not to pay, would the local authority end up picking up the tab, as the right hon. Member for East Devon (Sir Hugo Swire) warned? When a new town is planned in Scotland, a new town development corporation has to be set up. These issues have to be thought about carefully before embarking on a new town, and I imagine the hon. Member for Mid Norfolk is thinking about how it can best be done. We also need to get the right mix of private and public input, as well as schools and everything else that a community needs to flourish.
New towns have sometimes failed for lack of proper planning. BBC Scotland has produced an excellent documentary called “The Storm That Saved a City” about the 1968 Glasgow storm. It described the housing situation in the city of Glasgow, including slum clearances. The council planned to demolish absolutely everything and rebuild from the roots. It moved lots of people out to Easterhouse, Drumchapel and other parts of the city, but it did not put in facilities such as shops, pubs and social gathering places. Those communities still feel that they do not have all the facilities they need. We still have not learned the right lessons, because the Commonwealth games village was built in Glasgow without a school, a nursery or a row of shops. We need to learn from new towns. What has made them successful? What has made them thrive?
It would be useful if the Minister said a little about how the Government will legislate on new towns, and what guidance will be provided. When we build a new town, we build it to be a home—not just a set of houses, or somewhere to wake up in the morning and go to bed at night, but a community to live in for the long term.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank the hon. Member for Mid Norfolk (George Freeman) for securing this incredibly important debate. There is a lot of cross-party agreement on the issue, and I agree with almost everything that hon. Members have said in the debate. My only disagreement with the hon. Gentleman is that I think the issue affects both rural and urban areas.
If we want positive planning in this country, the best place to start is with local neighbourhoods and communities. The reason is obvious: local people know their area best, and they know best how to develop it. They understand not only issues such as local heritage, but infrastructure needs, which are often overlooked in planning but are necessary to make a development successful. I was really pleased that hon. Members raised that today.
I was also extremely pleased that the hon. Member for Mid Norfolk mentioned new towns. I am very keen to hear what the Minister has to say about new towns, because the Government have been a bit tardy, to say the least, in bringing forward new towns or garden cities. I think we probably all agree that garden cities have worked better than new towns, but it would be good to hear an update from the Minister.
There were some weaknesses in the conception of neighbourhood planning. A neighbourhood plan is not a free-standing document; it has to be developed in line with a local plan and strategic objectives. Neighbourhood plans have often been mis-sold to local neighbourhoods, who think that a plan can do something that it cannot. They run into particular problems when no up-to-date local plan is in place. We have all seen neighbourhood plans being developed, voted on and passed in areas where no local plan is in place or there is an issue with the five-year housing supply. Even if the council rejects a development because it is not in line with the local plan, its rejection is often overturned on appeal, using the national planning policy framework and the general presumption in favour of development. If the Minister wishes to give neighbourhood planning more teeth, he needs to look at that.
The Minister also needs to look at resources and at the whole local community effort necessary to developing a neighbourhood plan. I know that the Government have put some resources aside for developing neighbourhood plans, but in my experience such resources are often not enough, particularly in areas of special complexity. Neighbourhood plans are being developed while massive cuts are reducing the ability of planning departments to support parish councils and neighbourhood planning forums to implement them.
We all want neighbourhood plans to be more effective, but there are some issues with them. I was pleased to see, as a sign of cross-party consensus, that “ConservativeHome” has stated that the Government need to look more closely at neighbourhood planning because there are wrinkles to be ironed out. We all want our communities to be given the tools to plan effectively for their area, but we also want neighbourhood plans to be more effectively integrated into our overall planning system. Perhaps they need to be given greater weight—that seems to be one of the crucial issues that the Government still have to address. I appreciate that the Minister is new to his job, but we have great expectations about what he will deliver.
Mr Philip Hollobone (in the Chair)
If the Minister finishes his remarks no later than 5.28 pm, the Member in charge will have time to sum up.
The Minister for Housing (Dominic Raab)
As ever, Mr Hollobone, it is a great pleasure to serve under your chairmanship. I congratulate my hon. Friend the Member for Mid Norfolk (George Freeman) on securing the debate. He spoke forensically about the issue and eloquently about his constituency. He highlighted the importance of neighbourhood planning, which has been giving people real power to shape the development of their communities since its introduction in 2011.
I am pleased to have the opportunity to respond to points raised in the debate and take up the generous offer from my right hon. Friend the Member for East Devon (Sir Hugo Swire) to listen carefully to concerns. Hon. Members will know that, given the Department’s role in determining certain planning issues, I cannot comment on the detail of individual plans or planning cases. However, I can talk about the practice, the framework and the parameters that create the principles guiding the relationship between neighbourhood plans, local authorities and central Government strategy. I hope also to address the interesting points made by the hon. Member for Stroud (Dr Drew).
I know that many hon. Members have been directly involved in encouraging and supporting communities in their constituencies to take up neighbourhood planning; I recognise the role that MPs play in the process. I assure all hon. Members that we continue to support the principle of neighbourhood planning and that we are already looking at teething issues and wrinkles to be ironed out. In September, we announced our largest ever support package for neighbourhood planning: a £22.8 million programme that will start in April and provide communities with the help and resources that they need to develop plans up to 2022.
Before I address the important points raised by my hon. Friend the Member for Mid Norfolk, it is worth reminding ourselves of the wider national context and the big picture on housing. In order to meet demand, we have to deliver 300,000 homes every year by the mid-2020s. We have to provide the homes that Britain needs, but we also have to make them affordable for real people on low and middle incomes. As hon. Members have said, we have to build a lot more of the right homes in the right places. I take that point. There were 217,000 net additions to the housing supply last year. That was the highest level in a decade—an increase of approximately 70% on what was achieved in 2009-10—so there are positive signs, but there is still a long way to go.
We need to be mindful of how we tailor the vehicle, both in the context of local democratic affairs—points were raised today about carrying communities with us—and with respect to the overarching national demand and our mission to build the homes that the next generation needs.
It is absolutely crucial that local authorities play their role by producing up-to-date local plans and identifying a five-year supply of deliverable housing sites. Local plans and a five-year supply of housing sites can provide clarity for communities and for developers who want to do things the right way regarding where new homes should be built. That means that development is planned and is not the result of speculative applications. I have taken on board the points made by my right hon. Friends the Members for Mid Sussex (Sir Nicholas Soames) and for Arundel and South Downs (Nick Herbert) about some developers. I emphasise “some” developers; let us not tar all developers with the same brush, because, as I think hon. Members have said, there is good practice, but there is some bad practice as well.
As of today, 26 authorities are still to publish a local plan and 131 local authorities have a local plan that is older than five years. So, the big picture is that overall we are doing quite well, but there are certainly areas and pockets where we need to do better. My right hon. Friend the Secretary of State for Housing, Communities and Local Government has written to 15 authorities, giving them until the end of this month to justify why they do not have a plan in place and why the Government should not intervene. He has put other authorities on notice, explaining that a consistent failure to make sufficient progress in that regard cannot be tolerated indefinitely.
I turn to neighbourhood plans. They are, of course, voluntary. They rely on the enthusiasm and the hard work of local people, and, in the round, local communities. They are a powerful set of tools for communities to say where development—such as homes, shops and offices—should go, what it should look like, and what facilities should be provided. I pay tribute to my hon. Friend the Member for Henley (John Howell), who, as neighbourhood planning champion, has championed the cause of the right kind of local plans.
Neighbourhood plans undergo consultation, independent examination and the community referendum before coming into force as part of the development plan for their area. I take the point that was made by the hon. Member for Stroud about referendums, even though I was probably on a different side from him in our recent, bigger referendum. In this context, however, referendums are important, because they ensure that neighbourhood plans have genuine support and, as a result, some clout and some force. Their status as part of the development plan is very important, because planning applications must be determined in accordance with the development plan unless material considerations indicate otherwise.
Since the introduction of neighbourhood planning by the Localism Act 2011, 2,300 communities have begun the process of shaping the future of their area. I think that about 17 of those are within the constituency of my hon. Friend the Member for Mid Norfolk, and I recognise the local initiative that goes into such local plans. I also understand the point that he made about encouraging and not stifling that initiative, which is crucial.
Nick Herbert
Does my hon. Friend accept that the undermining of a referendum by failing to observe what the referendum has decided is, in its own way, just as damaging at a local level, in relation to a neighbourhood plan, as it would be at a national level if a decision made in a national referendum was not observed by the authority concerned?
Dominic Raab
My right hon. Friend makes a powerful point, and he is tempting me to muddy the waters of this debate in a typically mischievous way. I will accept that if we argue for the principle of democracy through a referendum and say that the result of the referendum needs to be delivered, and we then put in place a system of local referendums—often, people care even more about the issues in such referendums than they do about those in national referendums, because the issues relate to people’s local environment or their quality of life—it is important to make sure that they are respected.
We endeavour to continue to make the neighbourhood planning process stronger and simpler, to ensure that it is attractive to even more communities. This week, for example, we are implementing powers in the Neighbourhood Planning Act 2017. Those reforms make it easier for communities to keep their neighbourhood plans up to date as local circumstances change—they will change from time to time—and ensure that neighbourhood planning groups are made aware of local planning applications.
Other important reforms set out in the Act came into force last July. Those reforms require decision takers to respect neighbourhood plans earlier in the process, following a successful referendum. There will be further reforms this July, requiring local authorities to set out their policies on supporting neighbourhood planning groups.
I take this opportunity to welcome another neighbourhood planning success. The 500th successful neighbourhood planning referendum has just taken place; they are clearly catching on, notwithstanding the point that the hon. Member for Stroud made. That is quite an important milestone, which was reached by communities in Leeds, Suffolk and Lincolnshire. Those three communities are very different from each other, to touch on the point that the shadow Minister, the hon. Member for City of Durham (Dr Blackman-Woods), made. However, they all went to the polls on the same day, and between them they allocated land for employment, homes and local green spaces; those things can come together. Those plans are now the starting point for determining planning decisions.
Our planning policy is clear that where a planning application conflicts with a neighbourhood plan that has been brought into force, planning permission should not normally be granted. However, we recognised in 2016 that, in some cases, neighbourhood plans were being undermined because the local planning authority could not demonstrate a five-year land supply of deliverable housing sites, which is one of the key issues. That meant that even recently adopted neighbourhood planning policies were not being given enough weight in determining planning applications. I know that that is the crux of the experience of my hon. Friend the Member for Mid Norfolk, and the point that he wanted to make in this debate.
Communities who had worked hard to put their neighbourhood plan in place were left frustrated as decisions went against the plan, despite their having done everything that was asked of them. As hon. Members have argued, that can only undermine confidence in the referendum process and the localism agenda. Seeking to remedy that, we issued a written ministerial statement in December 2016 to ensure that national planning policy provided additional protection to precisely those communities. The change that was made protects neighbourhood plans that are less than two years old and that allocate sites for housing, as long as the local planning authority has more than three years’ supply of deliverable housing sites.
We will take forward that protection in the updated national planning policy framework, which will be published for consultation before Easter—I think there was a question earlier about its publication. I suspect that that will be the beginning of the dialogue and the debate, not the end of them.
The national planning policy framework will be amended to give local authorities the opportunity to have their housing land supply agreed on an annual basis, and fixed for a one-year period. I hope that that gives some reassurance. Through these new policies, alongside the tough action to get local plans in place, we hope to ensure that we get the right homes in the right places. That is the delicate line that we seek to tread here.
I should just say a few words about neighbourhood plan examinations, because of the significant legal weight afforded to neighbourhood plans. The plans need to be carefully examined in a fair and transparent way. If we had longer today, I would go into the matter in more detail. Effectively, the examinations are the check that, once passed, allows the referendum to proceed, which gives real force to the localism agenda in this sector.
I am conscious of the time that I must give my hon. Friend the Member for Mid Norfolk to allow him to wind up this debate. I appreciate that important issues have been raised today, whether they are in rural, urban or suburban constituencies, and I understand how deeply felt are the concerns about them. We will continue to protect neighbourhood plans in national policy, and decision takers—whether that is the local authority, the planning inspector or the Secretary of State himself—must respect that national policy.
Sir Nicholas Soames
Will my hon. Friend give way on that point before he sits down?
Dominic Raab
I am conscious that I have only eight seconds left and I really ought to give my hon. Friend the Member for Mid Norfolk the opportunity to wind up the debate, but I will give way briefly to my right hon. Friend.
Sir Nicholas Soames
Have the Government considered, or are they considering, limiting the amount of time for which builders can hold on to land before building on it?
Dominic Raab
As a new Minister, lots of helpful suggestions come my way. That is something that we will consider, in the context of both the Letwin review and some of the interesting policy submissions that have already been put to me. I undertake to have a look at that point.
George Freeman
Thank you, Mr Hollobone, for calling me to speak again and for the chance to serve under your chairmanship this afternoon.
I thank colleagues who have come to Westminster Hall to support this debate and the points that I have been making. We find out who our friends are when we put our heads above the parapet, and I could not wish for a better platoon of support. I should also say—both to you, Mr Hollobone, and to the Minister—that several colleagues who support the points that I have been making could not be here today.
I am grateful to the Minister for his typically assiduous, detailed and honourable answers and reassurances. There was some important and good news in there, in that the Government recognise the importance of the issue and in the steps that are being taken. However, having been a Minister myself, I know that officials often think that the issuing of a written ministerial statement or the granting of a new power might solve a problem. One has to remember that on the ground, our councils are up against real pressures, and new powers and written ministerial statements do not always cut through or solve the problem that exists here and now.
It is really important, not only for this issue of building houses but more broadly, that we recognise how free markets work. The Minister is a great advocate of free markets, as am I, but they operate in the context of the incentives and regulations that we set here in Parliament. If we are going to build the housing that we need and an economy that works for everyone, we really have to get this matter right. I ask the Minister—I am sure the answer is yes, as he has indicated so—whether he will agree to meet me, Councillor Gordon Bambridge, who is my local head of planning, and colleagues to discuss how we can take the matter forward.
Written Statements
(6 years, 10 months ago)
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Sporting Future and Anti-Doping
(6 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Tracey Crouch)
I am today publishing the second annual report on the Government’s sport strategy “Sporting Future: a New Strategy for an Active Nation”, together with the “Tailored Review of UK Anti-Doping”.
Second annual report to Parliament on Sporting Future
Sporting Future set out a new Government vision to redefine what success looks like in sport by concentrating on five key outcomes—physical wellbeing, mental wellbeing, individual development, social and community development and economic development. It was a bold new strategy for an active nation. It marked the biggest shift in Government policy on sport for more than a decade.
We have continued to build on the significant progress achieved in the first year of the strategy and have continued to embed, and invest in sport and physical activity on the basis of, the five outcomes. On mental wellbeing, for example, we are working closely with the Department of Health and Social Care to explore how elite and professional sport can improve its offer of mental health support. We are also building on Baroness Tanni Grey-Thompson’s duty of care report to ensure that sport takes its responsibilities to all participants seriously, whether that be elite athletes or those at the grassroots.
Investment in sport and physical activity continues to be focused on the five key outcomes. Funding has been opened up to organisations which can demonstrate how they will consistently deliver some or all of those shared goals, with a strong emphasis on tackling inactivity and engaging underrepresented groups.
We want to make sure absolutely everyone can benefit from the power of sport and I am grateful to all those across Government and the sport and physical activity sector who are working to make the ambition of Sporting Future a reality. The annual report is being deposited in the Library of both Houses and is available at: https://www.gov.uk/government/publications/sporting-future-second-annual-report
Report on the “Tailored Review of UK Anti-Doping”
Today I am also publishing the “Tailored Review of UK Anti-Doping”.
We want to ensure that the UK remains at the forefront of efforts to stop those who would wish to damage the integrity of sport through doping. This tailored review examines UKAD’s efficiency, effectiveness, governance and planning for the future.
The recommendations it makes will ensure that we are in the best place possible to continue efforts to stop drugs cheats and to continue to support athletes to compete on a level playing field.
We must continue to do all we can to support these efforts and I am grateful to all who were involved in, and contributed to, the review. The tailored review is being deposited in the Library of both Houses and is available at: https://www.gov.uk/government/ publications/tailored-review-of-uk-anti-doping
[HCWS432]
Naylor Review of NHS Property and Estates
(6 years, 10 months ago)
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The Minister of State, Department of Health and Social Care (Stephen Barclay)
My hon. Friend the Parliamentary Under-Secretary of State for Health (Lord O’Shaughnessy) has made the following statement:
I am today announcing the publication of the Government response to the Naylor review.
In March 2017, Sir Robert Naylor published his independent review, “NHS Property and Estates: Why the estate matters for patients”. It highlighted not just the scale of the challenge we face in ensuring that the NHS has both the buildings and equipment that it needs, but also the scale of the opportunity open to us. It set out how, by taking a more strategic approach, the NHS can generate money to reinvest in new or updated premises and in better patient care. Unused land can be released for much-needed housing, driving regeneration and creating jobs. Using healthcare buildings more efficiently can reduce running costs and deliver more integrated care.
The Government welcome the review and its recommendations, which we will implement in conjunction with national partners and the NHS.
Sir Robert set out the progress needed on three key themes to transform the NHS estate, and we are taking action in response. The themes highlighted by the review are leadership and capability, national planning and funding, and incentivising action locally. We are taking action on each of these themes.
First, we have created a new NHS property board, of which I am the chair. This brings together all the key national players and will act as a single point of leadership for the system on estate matters. We are improving capability at a local level by creating a new national strategic estates planning and advisory service, to help the NHS move from planning to delivery. This team has evolved over the last year as we have brought together all the local strategic estates advisers into a single team to provide expert advice to the NHS.
Second, we are taking steps to improve national planning and funding. Sir Robert gave a clear estimate of the level of funding required to enable the transformation of the estate to meet the vision of the five year forward view. It recommended this could be found through Government capital, private finance and proceeds from the disposal of surplus NHS land.
The Chancellor, in his autumn Budget, announced an additional £10 billion package of capital investment over the course of this Parliament. The Government have committed over £3.9 billion of capital for the NHS. This will support the NHS to increase the proceeds from the sale of surplus land to £3.3 billion. We expect it to be supplemented by private investment, where this provides good value for money. It is likely some of this will come from the types of schemes that already fund primary care facilities. With this £10 billion package of capital investment, we will develop a pipeline of transformational STP projects over the next five years so that the NHS can deliver on the vision of the five year forward view.
The first group of schemes to benefit from this new combined STP funding have already been announced and patients will see the benefits from this investment across a wide range of care settings.
Finally, we are taking action to incentivise local NHS organisations to take a more strategic approach to estates planning and management. I can reassure NHS organisations that they will be able to retain receipts from land sales, so these can be reinvested in the NHS estate, to renew and replace outdated facilities and to address backlog maintenance, in line with local priorities and STP strategies. Where surplus land is developed for housing, NHS staff will be given the right of first refusal on any affordable homes built. We have an ambition that this will allow up to 3,000 NHS workers and their families living in areas where accessing affordable housing can be challenging to own their home.
The Government have delivered their share of the funding needed; the NHS must also play its part. It cannot be right for NHS properties to remain unused and empty when their disposal could generate funds for reinvestment and thus improve facilities and services for patients. As Sir Robert recommended, in order to access capital funding STPs will need to develop robust estates plans with stretching disposal strategies and that reduce running costs and address backlog maintenance. The local NHS needs to act quickly to develop these plans and will be supported by advisors from the local strategic estates planning team.
I would like to again express my gratitude to Sir Robert, his advisory board and review team for their time, expertise and commitment.
The statement is available online at: http://www.parliament. uk/writtenstatements.
[HCWS433]
EU/Canada Negotiations: Passenger Name Record Data
(6 years, 10 months ago)
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The Minister for Immigration (Caroline Nokes)
Until the UK leaves the EU it remains a full member, and the Government will continue to consider the application of the UK’s right to opt in to, or opt out of, forthcoming EU legislation in the area of justice and home affairs on a case-by-case basis, with a view to maximising our country’s security and protecting our civil liberties.
The Government have decided to opt in to a Council decision authorising the opening of negotiations for an agreement between the European Union and Canada for the transfer and use of passenger name record (PNR) data.
This agreement will replace the EU/Canada PNR agreement which expired in 2009. The UK opted-in to negotiations for a new agreement which opened in 2010. When an envisaged agreement was presented to the European Parliament for approval in July 2014, the Parliament referred it to the Court of Justice of the European Union for an opinion on its compliance with the treaties and the charter of fundamental rights. In July 2017, the Court found that the envisaged agreement could not be concluded in its current form and the Council has now decided to reopen negotiations.
The UK, in common with the other EU member states and with an increasing number of third countries, places considerable value on the processing and analysis of PNR data for the prevention, detection, investigation and prosecution of terrorist offences and serious crime.
PNR data is used by many countries to detect individuals involved in serious crime and terrorism-related activity as well as enabling the protection of vulnerable victims of trafficking.
The Government believe that PNR agreements between the EU and third countries play a vital role in assuring the protection of personal data within PNR data and providing legal certainty for air carriers required to disclose personal data to third countries’ authorities. It is for this reason the Government have decided to opt in to the negotiation of an EU/Canada agreement on the transfer and use of PNR data to prevent and combat terrorism and other serious transnational crime.
[HCWS434]
Dartford Thurrock River Crossing Charging Scheme
(6 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Transport (Jesse Norman)
The Dartford Thurrock crossing charging scheme account for 2016-17 is published today under section 3(1)(d) of the Trunk Road Charging Schemes (Bridges and Tunnels) (Keeping of Accounts) (England) Regulations 2003. A copy of the accounts will be placed in the Library of the House.
It is also available online at: http://www.parliament.uk/writtenstatements.
[HCWS431]
House of Lords
European Union (Withdrawal) Bill
(6 years, 10 months ago)
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Baroness Evans of Bowes Park
That the Bill be now read a second time.
Relevant document: 9th Report from the Constitution Committee
The Lord Privy Seal (Baroness Evans of Bowes Park) (Con)
My Lords, it is an honour to open this debate on such an important Bill. It is almost a year since I opened the Second Reading debate on the European Union (Notification of Withdrawal) Bill. That Bill began the process of leaving the EU; this Bill ensures that we have a functioning statute book on the day we leave. It is about providing certainty and continuity for people and businesses. It is about ensuring that people’s rights are upheld and legal protections are maintained. It is vital to a smooth and orderly exit from the EU. The Bill is not about revisiting the arguments of the referendum. It is not about our future relationship with the EU, nor is it a vehicle for policy change. It is only part of the programme of legislation required to honour the referendum result.
The Bill begins by repealing the European Communities Act 1972, returning control of our laws to London, Edinburgh, Cardiff and Belfast. The Bill takes a snapshot of EU law that applies in the UK immediately before exit day and ensures that it will continue to apply in the UK afterwards. This will mean that, as far as practical, the same laws will apply the day after exit as the day before. Without this, a large part of our law would fall away when the ECA is repealed.
The Bill also ensures that questions about the meaning of retained EU law will be decided by UK courts in accordance with the case law of the European Court of Justice and the retained general principles of EU law as they stand immediately before exit. This approach maximises stability, ensuring that the meaning of the law does not change overnight. Only the Supreme Court and the High Court of Justiciary in Scotland will be able to depart from the European Court’s retained case law. Future decisions of that Court will not bind ours, but they will be able to have regard to those decisions if they consider it appropriate, in just the same way that they might refer to cases in other jurisdictions such as Australia or Canada.
My Lords, while the conversion of EU law into UK law is essential to ensure that we leave smoothly, simply preserving EU law is not enough. There will be many areas where the preserved law does not work as it should. So the Bill provides Ministers in the UK Government and the devolved Administrations with limited powers to make secondary legislation to address the problems that would otherwise arise when we leave.
These powers allow us to make appropriate changes to ensure our statute book works on day one and provide the UK Government and the devolved Administrations with the discretion that this unique situation calls for. This includes ensuring that Ministers can make the most appropriate choice where a range of corrections are available. This discretion is limited, however, as are the powers themselves. Failing to correct deficiencies in the law would have practical consequences ranging from public authorities submitting reports on water quality which the European Commission will not read, to causing disruption to the City by removing the supervision of credit rating agencies.
The Bill contains several other powers, including a power to implement international obligations and, following a government amendment in the other place, a power to alter exit day in the Bill if the UK and the EU agree to change the date the treaties cease to apply to the UK. Notably, Clause 9 of the Bill provides that the UK Government and devolved Administrations are able to implement the outcome of the negotiations on the withdrawal agreement with the EU. However, following a vote in the other place, the use of this power is now subject to the prior enactment of a statute by Parliament approving the final terms of withdrawal.
The Government have always been clear that major changes will be given effect through primary legislation, but to correct all the EU law that has accrued in the 46 years of our membership is simply not practical to do via primary legislation. Many of these corrections will be largely technical. It is important that all these changes are scrutinised, but they are of exactly the type for which secondary legislation exists. Although I understand the concerns about so-called Henry VIII powers—I am sure we will be debating this at length in your Lordships’ House—it is not so unusual to take powers to amend primary legislation where that can be explained and justified. It is the content of the changes being made, not where in the statute book they sit, that matters.
The Government have been clear that a separate withdrawal agreement and implementation Bill will be used to implement the major elements of the withdrawal agreement between the UK and the EU, including an implementation period pending the negotiation of the precise terms. That Bill, along with several other pieces of legislation required for exit, will come before the House in due course.
Finally, I turn to the Bill’s devolution provisions. We are guided by two key principles. First, we want a functioning statute book on exit; secondly, we want there to be no new barriers to living in and doing business across the UK. So I reiterate that no power whatsoever that is currently exercised by the devolved Administrations will be removed by this Bill. We have a strong record on devolution through the Scotland Act 2016 and the Wales Act 2017, where more powers passed to the devolved Administrations; and we have repeatedly made clear our expectation that there will be a significant increase in the powers of the devolved Administrations as a result of leaving the EU.
We will shortly be publishing our initial framework analysis, which will show that in only a minority of policy areas where EU law intersects with devolved competence do we expect to require a UK-wide legislative framework. Noble Lords will be aware of the Government’s commitment to bring forward amendments to Clause 11, the main devolution provision of this Bill. We, the Scottish and Welsh Governments are part way through a process to shape those amendments and are making good progress. In the absence of an Executive and Ministers in Northern Ireland, discussions are taking place with the Northern Ireland Civil Service, but the Government’s priority remains restoring devolved institutions. This is a complex area that we need to get right, and I hope these amendments will put us on the best possible footing to achieve legislative consent, which remains our overarching objective.
This Bill has been the subject of extensive scrutiny in the other place, and the Government listened and responded to the issues and questions that were raised. Acknowledging concerns about the impact that withdrawal could have on equality law, the Government made amendments requiring Ministers to make a statement alongside statutory instruments made under the Bill setting out whether they amend, repeal or revoke any provision of equality law and, if they do, the effect that has. The amendment also requires Ministers to make a statement that they have, so far as required by equality legislation, had due regard to the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by or under the Equality Act 2010.
There was extensive debate on the Charter of Fundamental Rights. The Government’s position on this is clear: the charter reaffirms the rights found in EU law, which will be brought into UK law by the Bill. It is not, and never was, the source of those rights. The absence of the charter will not affect the substantive rights available in the UK, which is why the Government published an analysis of the charter setting out how each substantive right within it will be reflected in UK law after we leave. This analysis looks at how each right flows through retained EU law and how it is otherwise protected by existing domestic or international law after exit. The Government also brought forward amendments preserving some EU-derived rights of challenge for a period after exit.
The Government listened to concerns about scrutiny of secondary legislation, welcoming amendments proposed by the Commons Procedure Committee to establish a Commons committee to sift statutory instruments made under the key powers in this Bill. This House brings a raft of expertise and experience to the process of scrutinising our exit through the Constitution Committee, the EU Committees, the DPRRC and the JCSI, as well as our well-established system for scrutinising secondary legislation through the SLSC.
My intention is that we should build on those strong foundations and incorporate the changes embodied by the new Commons committee into the terms of reference of the SLSC to allow it to recommend, within 10 sitting days, that the House’s consideration of specific negative instruments related to this Bill should follow the affirmative procedure to bring it in line with the procedures established in the other place. I am conscious that, as well as altering its terms of reference, the SLSC would temporarily need additional resources, both in terms of expert advice and members, to allow it to do this work.
I have already had constructive initial discussions with the chairmen of the relevant committees, the usual channels and the House authorities. I will bring detailed proposals before the Procedure and Liaison Committees for consideration in March, and the House itself will then be invited to agree the proposed approach. The Government are fully prepared to bring forward any necessary amendments to this Bill.
Not for the first time, there has been much speculation about what might be expected from your Lordships’ House as we consider this Bill. Some suggest that this House will ignore the referendum or attempt to use the Bill to frustrate the Brexit process. I do not share those concerns. I am keenly aware of the collective sense of responsibility felt across this House to our important constitutional role and I am confident that noble Lords will take a constructive approach to our deliberations. I am also very confident that those deliberations will be thorough and very challenging, which is exactly as it should be. As I have said on other occasions, noble Lords bring a wealth of expertise to our proceedings, and it is precisely when we do this that we show this House at its best. I also know that noble Lords respect the primacy of the elected House and the decision of the British people. I hope that the approach taken in the other place demonstrates our willingness to listen carefully to constructive suggestions and to engage with noble Lords across the House as our country takes this big step.
My noble friends Lord Callanan, Lord Duncan, Lord Bourne and Lady Goldie, and my noble and learned friend Lord Keen, will join me in listening carefully to the debate, and my noble friend Lord Callanan will tomorrow endeavour to respond to as many noble Lords as possible—the first of many challenges he will face as he takes this Bill through your Lordships’ House. He will also be responding to the Motion in the name of the noble Lord, Lord Adonis.
Untangling ourselves from the EU legal order is complex, but we approach it in good faith. We have never said that we would get everything right on our own. We have always been clear we would listen to constructive suggestions for improvements. We have a duty before us to deliver on the will of the British people to leave the EU, and to do so in a way that provides certainty and stability. The Government’s goal is one we all share: ensuring that the UK has a functional statute book after we leave. I look forward to the many debates we will be having over the coming weeks, and I beg to move that this Bill be read a second time.
Lord Adonis
At end to insert “but that this House regrets that the bill makes no provision for the opinion of the people to be secured on the terms on which Her Majesty’s Government proposes that the United Kingdom withdraw from the European Union.”
Lord Adonis (Lab)
My Lords, I beg to move the amendment standing in my name. There are more speakers in this debate than the entire membership of the House of Lords for the first five centuries of its existence, and more than for any other debate in our 800-year history. That may not be an entirely comforting thought to the 193 noble Lords waiting to follow me, but it is symbolic. It is because of the magnitude of the issues at stake that I move this Motion. Just as the first say on Brexit was given to the people, so the final say should rest with the people once they see the terms proposed by the Government. Our constitutional role is to ensure, with the House of Commons, that the people have the final say.
I earnestly wish that the Leader of the House was moving this Motion or, failing that, my noble friend the Leader of the Opposition. However, neither the Leader of the House nor my noble friend—and I hold them both in high esteem—yet feel in a position to recommend such a course. I suspect the time will come when they do but, as a stop-gap, I feel bound to put this matter directly before your Lordships. I do not have time to get into the huge economic, legal and strategic issues raised by the Bill. Taking them at large, I simply invoke George Orwell and his brilliant essay, Politics and the English Language. Orwell wrote that, in times of crisis:
“Political language … is designed to make lies sound truthful … and to give an appearance of solidity to pure wind”.
So it is with Brexit. The Prime Minister promises a “deep and special partnership” with the European Union when, in fact, we are leaving the Union and undermining our deep and special partnership. We are told that “frictionless” trade will arise, amazingly, from the setting up of thousands of trade barriers where they do not currently exist. And, on the future of Ireland, where Parliament ought to tread with especial care, given the tragedies of recent decades, the Government say they intend “continued regulatory alignment”, when their stated policy elsewhere is to discontinue alignment and promote regulatory de-alignment.
The House needs to try to reconcile rhetoric and reality in all these areas. We look forward to working closely with the Minister, the noble Lord, Lord Callanan, in doing so. The noble Lord entertains decided opinions on your Lordships’ House. He told a Conservative Party gathering recently:
“The House of Lords is the epitome of the establishment, full of ex-foreign office luminaries and people who think that their view is much more important than that of common oiks … or the public as a whole”.
Now, speaking as an oik, I am in awe of the noble Lord and his determination to put us in our place but, not being in the least defensive, I say that the interests of the public as a whole do not lie in making Britain poorer. They do not lie in undermining the Good Friday agreement. They do not lie in diminishing trade and our people’s right to live and work across Europe. They do not lie in scapegoating Europe and foreigners for the social challenges we face. And they emphatically do not lie in weakening our solidarity with Germany, France and the other democracies of Europe in standing up to Vladimir Putin and others who now, and will in future, threaten our borders, our lives and our values. These are grave matters. We owe the House of Commons and the public our advice, and I believe that, in due course, we owe our fellow citizens the right to decide for themselves whether the Government’s Brexit terms should proceed.
Edmund Burke famously said:
“People will not look forward to posterity, who never look backward to their ancestors”.
The greatest Leader produced by this House in the last century is the noble Lord, Lord Carrington, who is soon to celebrate his 99th birthday. He is the last man alive to have served under Churchill. Under Margaret Thatcher he was an outstanding Foreign Secretary and Secretary-General of NATO. When I arrived here as an absurdly young 42 year-old he told me not to be nervous but to buy a decent suit. He said to the House 50 years ago on Britain’s second application to join the European Union,
“my Lords, we are part of Europe … our civilisation, our heritage … our manners … are all European … The vision of a United Europe, of France, Italy, Germany and Britain united in common purpose and effort, must surely be something to stir the imagination of even the most phlegmatic and placid … What splendid possibilities for the future! What a lost opportunity for us and for Europe if we are deprived of the opportunity of making our contributions!”.—[Official Report, 8/5/1967; col. 1216.]
That is so true. Let us not throw it all away.
Baroness Smith of Basildon (Lab)
My Lords, we are considering this legislation in unprecedented circumstances. Whatever one’s views on Brexit, this country has embarked on a process of fundamental constitutional change with deep and far-reaching consequences. Brexit is a process, not an event. It is not just a government process, but a parliamentary one that will involve at least 10 Acts of Parliament and around 1,000 statutory instruments, with numerous Statements, debates and committees examining the detail. Yet, at a time when the country really needs strong and stable government, we have instead consistent and persistent reports of a weak Prime Minister buffeted from one position to another as she tries to bring order to the warring factions in her Cabinet.
Before us we have a Bill that started as the great repeal Bill, then became just the repeal Bill, and is now the European Union (Withdrawal) Bill. None of them does what it says on the tin. A better title might have been the “EU (Transposition and Interpretation) Bill”. That is not just a quibble over semantics but a recognition of the importance and the technical nature of the legislation before us, and why we are so concerned that it should be fit for purpose.
Yesterday, our Constitution Committee published its report. We are grateful to it for doing so in time for today’s debate and the weeks of Committee ahead of us. I am sorry that the noble Baroness did not make more reference to the report.
While the principle of whether we leave the EU is, for many, ideological, the detail of the Bill is not. It is not about leaving or even just about how we leave the EU; it is also about how we maintain domestic legislation in the future. It will introduce a third category of legislation, in addition to primary and secondary, of retained law. That is the body of law that currently applies here in the UK through our membership of the EU, but has been introduced in different ways, and which the Government now seek to convert into domestic legislation. It is a relatively straightforward concept, but the scale and complexity is unprecedented.
Our Constitution Committee reports that while the Bill’s aims are valid, as drafted it is constitutionally unacceptable. However, amendments could address the deficiencies while maintaining the fundamental principles, particularly the sovereignty of Parliament. The Bill seeks to ensure that, following exit from the EU, there is legal continuity and certainty in our legislation. It seeks clarity in the application of laws on, for example, environmental protection, consumer protection, and rights at work.
Noble Lords are all grateful to the Constitution Committee for its pragmatic suggestions for amendments to achieve the objectives of the Bill. We all want to avoid this becoming a fiendishly complex process that weakens both parliamentary sovereignty and legal protections that our citizens rightly take as granted. During the passage of the Article 50 Bill, the Prime Minister constantly argued that she wanted a “clean Bill”, as if amendments somehow made legislation dirty and impure. Listening to the debates in the other place, and also the conciliatory comments from the noble Baroness the Leader and the noble Lord the Minister on TV at the weekend, I hope we have now moved on from such ridiculous notions and the accompanying sabre-rattling that we have seen before.
The Government have pledged to table amendments to address issues such as the devolution settlement and MPs across the Commons have said that this House can be helpful on unresolved issues. We have even seen rare harmony on the Conservative Benches as the former Attorney-General Dominic Grieve, the Father of the House of Commons, Ken Clarke, and the Brexiteer, Sir William Cash, all urged your Lordships’ House to deal with outstanding concerns, including the future role of judges in interpreting EU law. I welcome the compliment from Leader of the House of Commons, Andrea Leadsom, when she said last week that noble Lords,
“play a very important revising role, for which we are grateful and they have expertise that we in this House benefit from”.—[Official Report, Commons, 25/1/18; col. 414.]
We welcome that opportunity. However, before some get a bit carried away, I give a brief constitutional reminder that any amendments passed by this House provide a further opportunity for consideration by MPs, who have the final say. For those who criticise that role, I re-emphasise a point that I have made before. The process of Brexit is too important and complex to be left to those who have no doubt, because only doubt brings questioning, and it is only through questioning that we examine an issue enough to get the detail right.
Too often, the Government have put off tough decisions. For example, as we have heard in our questions, the financial services sector is crying out for the Government to publish a future partnership paper, to provide some certainty to allow for future planning. Yet none has been forthcoming and ministerial responses were complacent at best. With 19 months having passed since the referendum, it is unacceptable that the Government have not yet got a grip on the issues facing Northern Ireland, our Crown dependencies and our overseas territories.
We have not yet seen a credible way of solving the Northern Ireland border issue, given the Prime Minister’s flawed ideological position against a customs union. We still do not know the Government’s plans for the future of Gibraltar, and even yesterday the Minister side-stepped the question of a potential Spanish veto on its inclusion in the new UK-EU relationship. Even now, the Cabinet still has not had that essential discussion on our future trade relationship with the EU. These issues cannot just be popped into the “too difficult” box with the notion that, somehow, we just have to leave and it will be all right on the night. It is rare—this may never happen again—that I offer sympathy to the Chancellor of the Exchequer, Philip Hammond. But the public attacks on him from his own party, for stating a moderate view of how we manage future trade with the EU 27 countries, are absolutely shocking.
The time for slick soundbites to pacify extremists has long gone. Instead of vague superficial statements of a “global Britain”, “Brexit means Brexit” and now the appalling “buccaneering Brexit”, we have to deal with the reality and the nitty-gritty of the detail. That is the test for this Bill and the Government. I am grateful to the noble Baroness for her words about a new committee for dealing with the massive number of SIs and look forward to discussing that with her further. We called for such a committee and consider it essential. However, I have also raised with her and others the need to do a bit more. Given the timescale, and the volume of legislation, I have suggested that early drafts of SIs should be published for consultation, purely on accuracy, even before being brought to Parliament. There would be no delay, and it would provide an extra layer of inspection to ensure that the detail is correct.
I ought to say something about the amendment in the name of my noble friend Lord Adonis. A similar amendment was considered by your Lordships’ House when we debated the Article 50 Bill, and I suspect that we may have another at later stages of this Bill. Although a further referendum is not something I am attracted to at this stage, for a number of reasons, I really do not think that this is an appropriate amendment on Second Reading or that it fits into this Bill, given the nature of the issues before us. Should he put it to a vote tomorrow, I do not intend to vote.
This is not a Bill that would have been brought forward by a Labour Government, so I want to share the key, but not exhaustive, areas where we consider that changes are needed to ensure good governance and the maintenance of legislative protections for our citizens. The Bill must facilitate transitional arrangements on the same basic terms as now, including continuing our participation in both the single market and customs union, and the legal basis and regulatory alignment that underpins them. We should recognise that organisations as diverse as the CBI and the TUC are both urging the Government on this. The Bill needs to ensure that key workplace, consumer and environmental protections cannot be diminished without proper parliamentary scrutiny and process. Despite great interest in Tudor history, the use of Henry VIII powers is excessive. I hope the Government recognise that they must scale back on the scope of such unprecedented and sweeping delegated powers being granted to Ministers and safeguard parliamentary democracy. The legitimate concerns of the devolved Administrations regarding powers repatriated from Brussels must be addressed and we look forward to seeing the Government’s amendments in Committee.
We certainly would not have excluded the European Charter of Fundamental Rights. It is worth noting that the Brexit Secretary himself relied on this when, in 2015, he took the Prime Minister to court. The Government’s unnecessary ideological exception causes confusion and uncertainty and we look forward to hearing from my noble and learned friend Lord Goldsmith on this issue. Despite the welcome addition of Dominic Grieve’s amendment requiring an additional statute, the Bill must set out how Parliament will play a truly meaningful role in the process, including if we face the most catastrophic of possible outcomes, that of no deal. After my noble friend Lady Hayter speaks tomorrow evening, I sincerely hope the Minister will be able to confirm that he is not under orders to return a so-called “clean” Bill with no amendments other than his to the other place.
Like many others in your Lordships’ House, I have carried that ministerial folder with its pages and pages of briefing, the questions and answers, the lines to take and notes on elephant traps. But, all too often, the first line of advice on any amendment says, in capital letters and bold print at the top of the page: “RESIST”. We have all been there. I have confidence that the Minister will want to listen to the House and to different points of view. I urge him to see this as a real opportunity for the Government to avail themselves—as Andrea Leadsom said—of the genuine expertise that is on offer.
I conclude with a final appeal to the Government for some certainty: certainty for individuals whose everyday lives interact with the hard-won EU rights and protections that we fought for, whether when at work, buying goods or enjoying this country’s open spaces; certainty for businesses that fear, without confirmation of a transitional period on current terms, falling off a regulatory cliff edge in just over a year; and certainty for Parliament as to its role in this process and for the judges who will have to interpret the law that this Bill enshrines.
Lord Newby (LD)
My Lords, it is now a year since your Lordships’ House began its debate on the Article 50 Bill and 10 months since the article itself was triggered. It is generally agreed that both the withdrawal agreement and the agreement on our future relations with the EU have to be concluded before the end of this year. So we are approximately half way through the entire period available for our exit negotiations. What has been achieved so far? The answer: virtually nothing.
The Government have formally agreed on the future rights of EU citizens living in the UK. But this was something that, from day one, they said they were going to do. They have agreed a divorce Bill, but, again, the Prime Minister had long made it clear that the Government were going to do just that—even if some members of her Cabinet did not agree. On the status of Northern Ireland, the Government have agreed a form of words that, far from settling the matter, is interpreted in a completely different way in Ireland from the gloss put on it here in London, as I discovered in a range of discussions I had in Dublin last week. On our future relationship with the EU, beyond bland and meaningless platitudes, we have nothing. In December, we were told that the Cabinet would agree on our future trading relationship with the EU during January. Well, January has come and almost gone, and there is still no sign of such a decision or anything approaching one. The Prime Minister is so cowed by a fractious, disunited Cabinet that she dare not even make a speech on the subject. Many in your Lordships’ House have longer experience of government than I do. However, I doubt whether any noble Lords have seen a Prime Minister or a Government in such a state of paralysis.
In the real world, our growth rate has fallen from the highest in the G7 to the lowest; the head of the OBR describes the economy as “weak and stable”; and the Government’s own assessments of the impact of Brexit on the economy are uniformly negative.
It is against this background that we begin our consideration of the withdrawal Bill. Of course, it was never intended to be a withdrawal Bill: it was supposed to be the great repeal Bill. That was until the clerks in the Commons objected to the use of the word “great”. They could equally have objected to the word “repeal”, because this is not a repeal Bill: it is a transfer Bill, taking the whole bulk of existing EU legislation and turning it into domestic legislation. While it is very easy to dismiss the kerfuffle about the Bill’s title with a smile, it is revealing of the Government’s overall approach to the Brexit process. That approach can be characterised as a combination of arrogance and incompetence, which is now threatening the future of our country, and the ticking of the clock in the background is getting louder every day. The withdrawal Bill exhibits the arrogance and incompetence of the Government in equal measure. Because of this, the Government have turned the Bill, which although very important is essentially a technical measure transferring legislative powers, into one of constitutional and political crisis.
Before turning to the Bill’s deficiencies, I should make it clear that we on these Benches have no intention of derailing it or unnecessarily spinning out debate. As with any other legislation, we will seek to scrutinise it carefully and, where we feel it necessary, seek to amend it. We have been fortified in this approach by the comments made from around the House during Report stage in the Commons. Not everybody went quite as far as the right honourable Kenneth Clarke, who said that:
“I hope and believe that the other place will make an enormous number of changes to this Bill … I hope the House of Lords will throw back some of the bizarre extension of the Henry VIII principle in this Bill”.—[Official Report, Commons, 16/1/17; col. 760.]
But MPs from all Benches, including some leading supporters of Brexit, accepted that the House of Lords had the right and the duty to make changes. I hope that we will not disappoint them.
The Bill is extremely technical and does not make for easy reading, but among the technicalities I see four broad areas where changes are warranted. First, on substance, the Bill does more than its ostensible remit in seeking to make substantive change to legislation and allowing such change to be made as legislation is translated into UK law. The most obvious example of this is the disapplication of the European Charter of Fundamental Rights, but it extends to allowing any change to any EU legislation which the Government think is merely “appropriate”—in other words, virtually anything at all.
Secondly, the Bill gives Ministers the power to make an extraordinarily wide range of changes by statutory instrument and to undermine the role of the devolved Administrations. This unprecedented extension of Executive powers, including Henry VIII powers, is not limited to this Bill but characterises all the Government’s Brexit legislation to date. What the Government seek to do, across the piece—we saw this in the Sanctions and Anti-Money Laundering Bill—is to bypass all normal parliamentary rules and scrutiny. This is not simply to make technical changes, but in areas where primary legislation is the accepted norm, whether creating new public bodies, introducing new criminal charges, or imposing new taxes, fees and charges.
Some 1,000 statutory instruments are apparently required to implement the Bill, yet it is unclear how such a deluge is to be managed and how we ensure that adequate scrutiny is achieved. The Commons has indeed inserted a sifting mechanism, but this is a very weak provision and obviously does not apply here. I am grateful for the recognition from the noble Baroness the Leader of the House that we need to have changes in this respect. I look forward to seeing them.
As for the devolved Administrations, the Government have repeatedly asserted, as we have heard, that they would bring forward proposals to rectify what is currently seen, including by Conservative Members of the Scottish Parliament, as an unacceptable power grab. We still await those government amendments. It is hardly surprising that the Bill has been described by the constitutional affairs committee of your Lordships’ House as,
“fundamentally flawed … in multiple ways”,
and “constitutionally unacceptable”.
Thirdly, we need to reduce the uncertainty and lack of clarity in the Bill about the status of the transposed law. In this respect, the extent to which UK courts should take account of evolving EU law needs to be made much clearer.
The final area of inadequacy relates to what happens if a Brexit deal is reached. The Government have consistently attempted to constrain the role of Parliament at that point. The Bill as it stands fails to give Parliament a meaningful role if no deal is reached and unnecessarily states that the exit date will be 29 March next year come what may—unless a Minister decides otherwise.
The Bill and the Government still also refuse to countenance the idea that, having fired the starting gun for the Brexit process, the people as a whole should decide whether the Government have produced a deal that they find acceptable. Opponents of a referendum on any Brexit deal have argued that such a vote would frustrate the will of the people. Yet, as of today, polls show that the people wish to have such a referendum and that, if it happens, they are likely to vote to remain within the EU. Those of us who argue that the people should decide this issue now represent the views of the majority. The onus is therefore on those who oppose such a vote to explain on what democratic basis they now do so.
I am sure there will be other important technical issues in respect of which your Lordships will wish to improve the Bill, and that amendments will seek to help the Government define exactly what kind of relationship they wish to have with the EU, were Brexit to happen. But there is one overriding fear that I suggest noble Lords should have in their minds as we debate the Bill. The Government have no substantive policy on what Brexit will mean in practice. We are hurtling towards 29 March next year with no hand on the steering wheel. The Government appear to hope to get to the other side of Brexit by muddling through until the last minute, then leaving many of the critical issues covered by a thick layer of ambiguity in any end-of-year agreement. They then hope to ram this pig-in-a-poke deal through Parliament and the legislative process via ministerial fiat. This is to sell Parliament and the people short. It will not do. We must, and I believe we will, prevent it.
Lord Hope of Craighead (CB)
My Lords, I think that we need this Bill. It is in everyone’s interest that the gap in our law book when we leave the EU should be filled. As the noble Baroness the Leader of the House says, we need a seamless transfer from one system to another when that event occurs, so I think that the Bill deserves to have a Second Reading and must be allowed to pass. Nothing that I am about to say should be taken as being in conflict with those basic points.
However, the Bill comes to this House in a sorry state. It was drafted many months ago when we knew much less about how the exit was likely to be managed than we do now. It all seemed so simple then; you only have to look at Clause 9 to appreciate that point. It is designed to give power to Ministers to implement the withdrawal agreement. It also provides that no regulations may be made under that section after exit day. The idea that everything that needs to be done could be achieved on or before exit day informs the entire Bill, but we now know that there will have to be an implementation or transitional period—call it what you will—after that date. So that is an absurd provision in the light of what we now know. Moreover, the Government have failed to bring forward the amendments that are so obviously needed to meet this changed situation and deal with other criticisms that received cross-party support in the other place.
Time is short so I will concentrate on just one of the important issues: devolution. This is of concern to all the devolved Administrations, but I hope that the others will forgive me if I speak only about the devolution settlement that is set out in the Scotland Act 1998. I spent many hours late into the night debating that Bill here—we often sat well after midnight in those happy days. I worked with the Act as a judge on many occasions from its enactment until my retirement and learned to respect the way in which it had been drafted. That is why I am astonished by this Bill’s failure to respect that settlement in its formulation of the regulation-making powers given to Ministers.
There is of course a political angle to this issue, too. The Scottish Ministers have declared that they will not put a legislative consent Motion before the Scottish Parliament unless their objections to this are met. The bonds that hold the UK together would be stretched almost to breaking point if the Bill were to proceed to enactment without their consent. As a mere lawyer, I am in full sympathy with their objection.
Ministers may think that this is merely an enabling Bill, but it is not. It is about our constitution, too. The situation that it provides for as we leave the EU is entirely new. It is one that we have not had to face since the Scotland Act was enacted. The constitutional arrangements that were settled by the Scotland Act 1998 have to be changed but, as the Bill stands, they are being rewritten in a way that is naive and very damaging. Others will criticise some of the clauses containing regulation-making powers as amounting to Henry VIII clauses. As far as I know, Henry VIII never got to Scotland, but Oliver Cromwell did and he and the forces under his command did quite a lot of damage while he was there. I think that these clauses have a touch of Oliver Cromwell about them.
This issue goes far beyond the much-criticised Clause 11, which is about retaining EU restrictions in devolved legislation when we leave the EU. You can find these regulation-making powers in Clauses 7, 8 and 9 and throughout the entirety of Schedule 2. They are far-reaching and we must assume that they are there because it is intended that they should be used. As the wording stands, they could all be exercised to their fullest extent in all areas that are devolved to Scotland without any consultation whatever with the Scottish Ministers.
The legislative competence of the Scottish Parliament after exit day has been called into question, too. That would not be so bad if we could be certain that these provisions would have a very short life because everything that needed to be done could be achieved on or before exit day. As matters stand, though, we can expect these powers to be exercised for many months after that date. Those in Clause 9 are time-limited, absurd though that limit may now seem to be, but the remainder are not.
Ministers may say that that is not their intention; I listened with great care to the words from the noble Baroness about devolution. If so, I urge them to make their position clear in the Bill. Only if they are willing to do that are they likely to win the confidence of the Scottish Ministers in the area where a real opportunity lies for a mature and intense discussion, as we seek to define how the system of devolution can best operate in a new and vigorous UK single market after exit day. That is what the discussions about a redesigned Clause 11 should really be about. It is an area where there ought to be a real opportunity for an agreed way forward.
However, there is much more to the issue than Clause 11, as I have tried to emphasise. It is hard to see those discussions getting anywhere so long as the basic architecture of the Bill is so misguided and ill-informed. I will be bringing forward amendments that seek to resolve that problem and I hope that they will be supported across the House. If others seek to do the same thing, I will support them, too.
The Lord Bishop of Leeds
My Lords, many speakers will attend to the technical and legal details of the Bill and they will be better equipped to do so than I am. I therefore want to use my time to pay attention to a question that lies behind the nature of the Bill and the choices that we are required to make in scrutinising and attempting to improve it. This question applies to all sides of the argument, whether we think that leaving the European Union is an unmitigated disaster or the best thing since Winston Churchill mobilised the English language and sent it into battle.
The question goes beyond economics and trade deals. It haunts constitutional matters and refuses to be submerged by ideologically driven assertions that promise what cannot be promised and ridicule arguments that are inconvenient. Brexit has unleashed the normalisation of lies and rendered too easily acceptable the demonising of people who, with integrity and intelligence, venture to hold a contrary view. We are in danger of securing an economic platform at the expense of a culture of respect and intelligent democratic argument.
The question that I allude to is simply this: at the end of this process, what sort of Britain, or indeed Europe, do we want to inhabit? I accept that this is almost an existential question, even a challenge, but, as we debate the legislative detail, we must not lose sight of the point of it all. Existential questions cannot be determined by statute, but the shape of statute speaks loudly of what we think our society should be for, and for whom. This is why debate about the discretionary powers of Ministers to make laws with equivalent force to primary legislation is of such importance. When such powers are so wide that this House is asked to leave to the judgment of Ministers the meaning of such terms as “appropriate”, it is only right to ask for definition. After all, history is riddled with the unintended consequences of what might be termed “enabling legislation”.
Let us be honest, though: Brexit is technically so demanding and complex that, if I were Prime Minister, I would want the authority to deal flexibly with anomalies and technical weaknesses as quickly and smoothly as possible as the consequences of Brexit became known. I understand the technical element of this, but the Bill goes beyond legislative technicalities and impacts strongly on constitutional arrangements and the balance of power. Surely, if “taking back control” by Parliament is to mean anything, it must mean refraining from bypassing the essential scrutiny that Parliament is privileged and required to provide. Hard parliamentary scrutiny might be inconvenient at times, but the long-term consequences of granting Ministers unprecedented powers, as set out in the Bill, must be considered, as they will shape the deeper culture of our state and change our assumptions about democracy. This suggests that, although any sane person will recognise the Government’s need to have significant powers to ensure that process and legal certainty post Brexit are as smooth as possible, there must be limits to the use of such powers. As a colleague of mine put it succinctly and colourfully, we must avoid Brexit Britain turning into Tudor Britain. Clearly there is a balance to be struck, but I do not believe that the Bill as currently formulated achieves that balance, nor does it demonstrate that the genuine fears of constitutional experts and lawyers have been properly heard.
I have two concerns about the culture in which this debate is being conducted in this country—seen with incredulity by those looking at us from beyond these islands. First, almost every paper, every debate and every statement about Brexit is clothed in purely economic terms. It is almost as if the economy were everything and economics the only good. Yet, the economy—one might add the word “trade”—is not an end in itself, but rather a means to an end, which is human flourishing and the common good. The economy—trade—exists for the building of society, but society is more than the economy. It is simply not enough for us uncritically to assume that a market society, as opposed to a social market, is a given or an ultimate good. Culture is more than money and things.
Secondly, the referendum tore off the veneer of civilised discourse in this country and unleashed—perhaps gave permission for—an undisguised language of suspicion, denigration, hatred and vilification. To be a leaver is to be narrow-mindedly stupid; to be a remainer is to be a traitor. Our media—and not just the ill-disciplined bear pit of social media—have not helped in challenging this appalling rhetoric or the easy acceptance of such destructive language.
Beneath this lurks an uncomfortable charge articulated in a recent Carnegie report on tensions between Russia and the West by the deputy director of the Russian Institute for Political and Military Analysis in Moscow: if Russians would still die for the motherland, what would we die for in the West? As Martin Luther King suggested, if we do not know what we would die for, we have no idea what we would live for. Once we have done Brexit, then what? What was it for? Who do we think we are?
If this debate on Britain’s future is to have any lasting value and not just undermine long-term relationships of respect and trust—the civic public discourse—then attention must be paid to the corruption of this public discourse. Politicians could begin by moderating their language and engaging in intelligent, informed and respectful argument that chooses to eschew personalised or generalised vindictiveness or violence. We must not allow our body politic to be defined by Brexit; rather, we will need to transcend the divisions currently being forced by the terms of discussion. Peers have an opportunity to model good ways of disagreeing well, which might encourage others to see that there is an alternative to a political culture that appears sometimes to have been reduced to an unbridled tribalism where the first casualty is too often the dignity of the other. Please let us not lose sight of the deeper question that lies behind the technical detail of this Bill.
Lord Hill of Oareford (Con)
My Lords, this is a technical Bill with a simple purpose: to provide as much legislative certainty and predictability as possible as we leave the EU. In some ways, it is quite a boring Bill, but that does not mean that it is not important. To translate the whole body of European law into British law will be a massive task. To provide the certainty, the Government must be able to move fast at a time when, by definition, not everything is yet clear. But we have to balance that need for speed with making sure that the Government face proper scrutiny. No one knows better than this House the need for proper scrutiny—we are experts at being boring—and no one knows better than us the state in which legislation often comes to us from the other place.
I gently suggest to the Government that they look with an open mind at constructive suggestions as to how the process of scrutiny could be improved. This is an area at which this House excels and where we can burnish our reputation. We will damage our reputation if we try to use this Bill to play politics, slow the process down or seek to undo commitments given in manifestos or in parliamentary votes, so I was encouraged by the remarks made by the Opposition Front Bench that it sees the Bill in the same light.
I agree with the Government when they say that the Bill should not be used to increase uncertainty, but they themselves need to reduce uncertainty by taking some decisions and being honest about the consequences of them. Just as with any other change in politics, there will be winners and losers from Brexit. There is no point denying that basic truth. The Government need to concentrate on working out how to mitigate those losses and to accelerate the wins.
Business leaders increasingly say to me that it is the political paralysis caused by the process of Brexit that depresses them more than Brexit itself. They want the transition agreed with the minimum of argument and then to have clarity as to the future direction of travel. Instead of talking endlessly about Brexit, they want to know about life after Brexit. Here, the Government will have to choose. There is a reason why we have the saying that he is trying to have his cake and eat it; we know that it is physically impossible both to have your cake and eat it. So, to state what should be obvious by now, we are simply not going to be able to be both in the single market and free to make our own rules where we want to.
Although there is flexibility in the European system when it wants to be flexible, we will not be able to converge where it suits us to have continuity and to diverge where it suits us to be more competitive. During the referendum, one of the reasons why I voted remain was that I thought that it would make no sense at all for a service-based economy such as ours to be bound by rules over which we had no influence. Now that we have voted to leave, that same logic holds—actually, the logic is even stronger, because the act of Brexit is itself changing the dynamic in Europe. Contrary to one of the referendum myths, we had a lot of influence in the EU: pro-free trade, pro-markets, pro-business, pro-proportionate legislation. But that voice has fallen silent. As a result, Europe is already moving in directions that we have traditionally resisted, whether that is a financial transaction tax, more screening of overseas investment or more centralisation of supervision of financial services. For an economy that is as dependent as ours on services, how could we in all seriousness subcontract all rulemaking to someone else?
If, as I believe, we will have to choose, we must surely place a greater priority on being able to shape our own future than on preserving the status quo, particularly when technological innovation is itself going to change the status quo, whatever we decide on Brexit. We need speed, honesty and certainty. The Bill can help us on that path and it is in that spirit that I hope we can approach it in this House.
Baroness Taylor of Bolton (Lab)
My Lords, I do not wish to speak on the pros and cons of Brexit. I will say a few words about the concerns raised by the Constitution Committee, which I now have the privilege of chairing, because, whatever our personal views on Brexit, we must as a House fulfil our constitutional responsibilities to try to make this legislation fit for purpose, even if we disagree with the purpose.
I remind the House that following the result of the referendum the Constitution Committee, then chaired by the noble Lord, Lord Lang, took the unusual step of publishing a report that anticipated some of the problems that would arise in legislating in this area. The committee realised at that very early stage that there would be significant challenges for the Government and Parliament as a whole.
Following the publication of the European Union (Withdrawal) Bill, the committee produced an interim report in September last year looking at how far the Government had taken on board the concerns that had been raised pre-publication of the Bill. The committee was disappointed, to put it mildly, that the Government had not really listened to our earlier concerns. Indeed, had they done so, many of the problems that this legislation presents would not now be so difficult. Following that interim report, the Constitution Committee took evidence on the detailed and specific provisions in the Bill. Yesterday we published a report that goes through the Bill in great detail and highlights the significant—indeed, fundamental—flaws of a constitutional nature that we believe still exist and should be of concern to the whole House.
Our major and most significant concerns are threefold. First, there is the issue of legal certainty. We conclude that the Bill risks fundamentally undermining legal certainty in this country, a view that is shared by some of the most senior judicial experts. That is a very serious matter. Secondly, we are concerned about Parliament’s ability to fulfil our constitutional responsibilities in holding the Government to account and scrutinising all the legislative changes that are being proposed, especially when Ministers are seeking such broad delegated powers. Thirdly, we have concerns about the potential risk to the current devolution settlements that could result from the Bill, as the noble and learned Lord, Lord Hope, has outlined. Amendments in all these areas will be key to making the legislation fit for purpose, which is what the noble Baroness the Leader of the House hopes we will do.
I believe that changes and amendments are essential. The committee did not just criticise the Government’s Bill; we made specific recommendations as to how these problems could be addressed. We have sought to be constructive and to propose changes that will help to make the Bill fit for purpose and that do not undermine the Government’s intentions.
Our first proposal is to give greater clarity and certainty to the retained EU law that the Bill would create. We believe that we should give all relevant existing EU law the status of primary legislation, deemed to be enacted on exit day. This would mean that such laws would have a clear legal status in relation to other domestic law. Moreover, and importantly, it could then be amended only by Parliament. Such a move would be consistent with the doctrine of parliamentary sovereignty.
On our second concern, about the additional powers going to Ministers and the scrutiny of delegated legislation, we took evidence from the Government. I heard what the noble Baroness the Leader of the House said today, but we need more than just the committee structure that she was outlining. We have made some suggestions that are significant and would help. For example, we have suggested that Ministers must give good reasons for making changes by regulation, not simply judge for themselves that it is “appropriate” to make such changes. We recently had amendments to the Sanctions and Anti-Money Laundering Bill of that nature and I hope the Government will consider similar changes here. We also propose something constructive when we say that Ministers should have to personally certify whether new SIs contain any policy changes, so that we have maximum clarity on what we are considering.
I must say a word about the problems surrounding the Government’s relationship with the devolved assemblies. The noble Baroness the Leader said that progress was being made, but we were told that, when the Bill was in another place, amendments to Clause 11 were promised but not delivered. As the noble and learned Lord, Lord Hope, said, there are significant potential consequences. If the transfer of powers and competences from the EU to the appropriate Administrations does not take place smoothly, we could have a constitutional crisis. It is important that the Government realise that they cannot simply impose a settlement. The devolved authorities must be involved as partners in this.
I have focused my remarks on the need to make this Bill a piece of legislation that can function properly, because I believe, and my committee believes, that it is our constitutional responsibility to make all legislation fit for purpose. However, significant amendments are required if we are to achieve that.
Lord Wallace of Saltaire (LD)
My Lords, I want to make three points: on the degree of freedom the Government are asking for to make secondary legislation; on the absence of guarantees for consultation with English regions and local authorities; and about the uncertain links between withdrawal from the EU treaties and Britain’s future contribution to Europe’s political and security order.
The Leader of the House has just told us that the Bill offers certainty. It does not. The Government are asking both Houses to take an enormous amount on trust. It would be easier to trust the Government if they could provide some indication of what future relationship with the European Union they want to negotiate. Scrutinising this Bill against a background of open disagreements among Ministers and Conservative MPs about future alignment or the divergence of regulation will be peculiarly difficult. If half the Conservative Party does not trust the Cabinet on this, and the unelected journalists of the Daily Mail and the Telegraph are actively mistrustful, how can we grant the Government such wide ministerial discretion?
The cloudy phrases that the Prime Minister trots out to obscure where the Government intend to take us, on a relationship that is fundamental to Britain’s future economy, security and place in the world, make the confusion worse. What is a “bespoke” agreement? A friend has told me that a bespoke suit is one that costs a great deal more than one off the peg, but offers only a few tweaks in the way it is put together. The phrase a “deep and special” agreement is deliberately ambiguous. No Minister has spelled out the subtle differences between a “transitional” agreement and an “implementation” agreement, or the distinction between “a” customs union and “the” customs union. This House is justified, therefore, in narrowing the degree of ministerial discretion that the Bill permits. We have been given little idea of what Ministers might consider “appropriate”, as the Bill says, in exercising the executive powers it gives them. We should therefore amend that term wherever it appears to “necessary”, to narrow the degree of freedom they are given. I hope that this will command support across the House.
There will be much debate in Committee about the implications of Brexit for the devolution settlement with Scotland, Wales and Northern Ireland, and whether repatriation will tip the existing balance of competences in favour of Westminster. Those of us who live in the English regions—above all those of us who live in the north—will want to see how far we can insert amendments to provide for effective consultation also with English local authorities. Yorkshire and the north-east have a combined population larger than Scotland, have much greater economic interdependence with the European continent than Wales or Northern Ireland, and have benefited from EU funding while Westminster has starved the north of funds. We will work with the Local Government Association to insert a requirement for consultation in this Bill, unless the Government come forward with clear proposals of their own—and I gather that that is now under discussion.
The Bill’s focus is primarily on repatriating powers under the Treaty on the Functioning of the European Union. I will seek also to probe the Government on the implications of withdrawing from the more intergovernmental Treaty on European Union, which is concerned with fundamental rights, democratic principles, common foreign policy, and security and defence policy. Do the Government intend to opt out of any concern about the future European order after we leave? Or do at least some Ministers intend that continued co-operation in these crucial fields will somehow be woven into the “deep and special partnership” that the Government promise us they will eventually define? It would be a complete betrayal of a crucial theme in Margaret Thatcher’s Bruges speech to opt out of sharing the responsibility for maintaining and strengthening a democratic order across the whole of Europe. If I may remind the House, she said:
“Britain does not dream of some cosy, isolated existence on the fringes of the European Community. Our destiny is in Europe, as part of the Community … The European Community is a practical means by which Europe can ensure the future prosperity and security of its people in a world in which there are many other powerful nations and groups of nations”.
This Bill shows that those who claim Mrs Thatcher’s legacy have betrayed it.
However, the Government are now reported to be reconsidering the complete withdrawal from foreign and defence collaboration. There are even whispers about continued membership of the European Defence Agency, covered by Article 45 of the Treaty on European Union. I and others will be probing the Government on what form of continued association they intend to negotiate on the areas covered by Articles 23 to 46 of the TEU, and how they intend to seek parliamentary approval for their engagement in these fields.
Another empty phrase, “We are leaving the European Union but we are not leaving Europe”, is intended to blur the question of how we will associate with the EU’s established frameworks, which successive British Governments, from the noble Lord, Lord Carrington, onwards, helped to build. The Foreign Secretary has said nothing about this central issue so far as I am aware, but we are entitled to an answer as the Bill goes through.
Lord Pearson of Rannoch (UKIP)
My Lords, I support most of this Bill but worry that it may never be used if those who want to reverse the decision of our referendum succeed. I fear they may do so if the Government do not radically change their negotiating strategy in Brussels, so I have some advice for them in that regard.
The Brexit saga brings home to us the chasm between our politicians and their bureaucrats in one camp and our business community in another. Each camp tends to look down on the other, with the politicians and bureaucrats regarding our businessmen as rather grubby people, driven by the profit motive and often open to shady deals in its pursuit. In this, they overlook the fact that their own salaries and way of life, the NHS and other services of the state are supported by the taxes paid by our business community. That community, in turn, tends to despise our political class as not living in the real world and for not being exposed to redundancy or ruin if they fail. “They’ve never had to do a deal in their lives, so no wonder they’re making such an appalling mess of Brexit”, is a view I hear nowadays from every leading businessman to whom I speak.
To do a deal, you have to know what you and the other side want out of it. You have to know their and your strengths and weaknesses, what you are prepared to concede to get what you want, and at what point you really will get up and leave the table. I fear the Government are failing on all these fronts. Their worst mistake is underestimating the strength of our hand in Brexit’s four main issues: mutual residence, trade, security and cash—which should be taken in that order, not the other way round. On mutual residence, there are some 4 million EU people living here against 1.2 million of us living there. On trade, if we end up on WTO terms, EU exporters will pay us tariffs of some £13 billion per annum while ours will pay them only some £5 billion. On security, we are part of the “Five Eyes”. On cash, we give them £10 billion in net cash every year, or the annual salary of 1,000 nurses every single day.
However, the Government have allowed the Eurocrats to take these issues back to front, and they appear to have done so thanks to a basic misunderstanding of the meaning and force of Article 50 in international law. I am no expert in international law but I draw noble Lords’ attention to the opinion of someone who is: Professor Ingrid Detter de Frankopan, who holds a doctorate in European law and two others. She wrote an article in Money Week on 22 November 2016 entitled, “Don’t trigger Article 50—just leave”. I will put copies in your Lordships’ Library and can send a copy electronically to any noble Lord who feels he should read it. The core of Professor de Frankopan’s advice is that we did not and still do not need to go further than paragraph 1 of Article 50, which says:
“Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements”.
She points out that the UK does not have a written constitution but that a referendum of the people and votes in Parliament nicely fill the gap.
So the Government should now change direction. They should sit the Eurocrats down and tell them we have done our best to make paragraphs 2 to 5 of Article 50 work but they have abused our trust, and we see no future in going on like this.
So we are, unilaterally, taking back our law, borders, fisheries, agriculture and so on, but we will also be generous. We will give them wide mutual residence; we will allow them to continue in free trade with us; we will go on helping them with security; and then we will decide how much cash we will give them, which may be nothing after 29 March next year if they do not behave themselves and fall in with the above—or, if they do, it may be quite a lot. The Eurocrats will do almost anything for our cash.
Our biggest negotiating difficulty is that the Eurocrats’ main priority is to keep their failing project of European integration going. If we make a success of Brexit, that becomes even more difficult. But we have to take that head on; it is not our problem if the Eurocrats lose their plush but pointless lifestyles, their fraudulent budgets and their silly mirage that the EU has brought peace to Europe. They could not care less about the real people of Europe, as witnessed by the misery caused by their euro. We should make more of an effort to talk directly to those real people: the French wine growers, the German car manufacturers and the others who will pay us those tariffs if we do not continue in free trade together. We should divide the real people—who all have votes, incidentally—from the doomed Eurocrats.
I end by pointing out how dishonest is the position of those who now want Parliament to have a say in Brexit’s outcome but who, in truth, want to reverse the referendum’s result. May I remind noble Lords that they have stood affectionately by while some 20,000 EU laws have been imposed on this country since 1973, without the Commons or your Lordships’ House being able to do anything about them? Why do they now care if our elected Government repeal or amend some in the national interest?
I remind noble Lords that our democracy has also been betrayed in the Council of Ministers, where our Government have been outvoted on every single one of the 77 measures that we have opposed in the last 20 years.
I finally remind noble Lords, yet again, that the whole project of European integration was designed to deprive the people of their democracy. As Jean Monnet said in 1956, “Europe’s nations should be guided towards a super-state without their people understanding what is happening. This can be accomplished by successive steps, each disguised as having an economic purpose, but which will irreversibly lead to federation”.
The problem for the noble Lord, Lord Adonis, and his supporters is that the British people are not fools—they have seen through it.
Lord Dobbs (Con)
My Lords, I am not quite sure what I have done to deserve the honour of being squeezed between the noble Lords, Lord Pearson and Lord Mandelson. I will separate them temporally; I do not suppose that I will need to separate them ideologically. They will leave a vast ideological lowland across which I can wander with great freedom—oh happy days.
In 2015, this House approved the European Union Referendum Bill. In 2016, that referendum was held and its result was decisive. The people spoke. They spoke again in the 2017 election, when the vast majority of votes were given to parties that supported the outcome. Then, in 2018, bringing us bang up to date, the elected House of Commons—the people’s House—supported this withdrawal Bill. We cannot say that we have not been warned.
Yet now, from some quarters, we hear all sorts of reasons why we must duck and dive and dilly-dally, all dressed up in the language of constitutional propriety. There are some who let their honest ambitions slip and openly talk, outside the House, of sabotaging Brexit. That is sad and unwise. They will not sabotage Brexit, but they might well sabotage the credibility of this House, which is not well loved. Our support among MPs is falling and there are many in the press who are waiting with sharpened knives, particularly after the Data Protection Bill, to slit our veins. We ourselves agonise over reform, about reducing our numbers and increasing our effectiveness, which is, I suppose, tacit acceptance that the House of Lords is not entirely fit for purpose. If we were to make a constitutional Horlicks of this Bill, we will have made that point inescapable. We are unfit for purpose and the tumbrils will not be far behind.
I know that I tend to dramatise everything—it is what cheap novelists do—but since the noble Lord, Lord Adonis, began with a little bit of history, let me indulge in a bit, too. Some 100 years ago, this House came to the brink of disaster through naked self-indulgence. We turned our backs on Lloyd George’s “people’s Budget”. We cut ourselves off from the people. The House of Lords was accused then of being,
“one-sided … unpurged, unrepresentative, irresponsible”—
the words, incidentally, of that notorious troublemaker Winston Churchill. The Liberal Government of the time were left with no choice but to threaten to create hundreds of new Peers to get their legitimate business through, even to plan for the complete abolition of this place. Does any of that sound familiar? “So what?” one might say. The rights of this unelected House are clear, but so are its responsibilities. We have a duty to advise, enhance and improve where we can, but not to obstruct or overturn, least of all to sabotage.
Yet I am an optimist. Cool heads and sweet reason will, I am sure, see us through. The Government have made it clear that they will listen—they have already moved on several fronts—and the Labour Front Bench has offered wise and sensible words as to the limits of its ambitions. Undoubtedly the Bill needs scrutiny and improvement. The noble and learned Lord, Lord Hope of Craighead, gave a fascinating insight into some of those expectations. I hope that this will be our finest hour, or our finest week, or our finest months, as it will probably turn out to be. Am I being naive in thinking that there are those who talk of their parliamentary duty and the need for delay when in fact they intend to destroy? “It is too soon, too quick, too complicated”, they cry, “let us talk some more”. Like Penelope at her loom, they protest their innocence, while in the dark hours they do their best to unstitch it all and hope that Jean-Claude Juncker, or maybe even Tony Blair, will suddenly appear on the horizon and turn back the clock. Never let failure piled upon failure stand in the way of personal ambition.
The ambition of this Bill is modest—simply to ensure continuity from day one. Very little will change. Yet, I grant, in these modest changes, everything will change. We will bring government back closer to the people. We will once again make our own laws and be subject to our own courts. That is what the people have given their voice to, time and again, and that is what we must enable, through this Bill, and in a timely manner. This is one of those special parliamentary moments; it might even be called historic. A hundred years ago it was the people’s Budget. Today it is the people’s Brexit and I profoundly welcome it.
Lord Mandelson (Lab)
My Lords, the noble Lord squeezed in very enjoyably. Following the referendum in 2016, as much as I regretted the result, I took the view that it must be upheld. I believed that the Government should deliver Britain’s exit from the European Union and that the duty of Parliament, including of this House, was to facilitate that. I no longer believe that to be axiomatic. The Government cannot behave as if they have a blank cheque to take Britain out of the European Union in any vandalistic way they choose.
Every day brings fresh evidence of the Government’s inability to agree what our future relationship should be. Last week, I listened to the Chancellor’s speech to the British business lunch in Davos. He clearly wants all the trade benefits of the single market without actually being in it. I admire his ambition but, like the Prime Minister, he is trying to dance on the head of a pin that does not exist. As President Macron said when he visited Britain:
“You can’t buy, by definition, full access to the single market if you don’t tick the box”.
The Government’s red lines mean that the box cannot be ticked.
Within an hour of speaking, the Chancellor was being attacked inside the Conservative Party. Some 90 minutes later, the Prime Minister, who first backed him after he had spoken, disowned him. By early evening, the Chancellor, rather than standing his ground, was tweeting a reinterpretation of his own words. This is what passes for a normal day at the office in this Government. It left British business leaders bemused and demoralised. To cap it all, at the end of the week, the Brexit Secretary was saying on the radio that, just because there are differences, that does not mean that the Government cannot negotiate coherently. Heavens! Is it surprising that the public are losing faith?
The only way to have coherence in a negotiation is if you adopt a unified view. I learned that much as a Trade Commissioner. Yet one side of the Cabinet says that it wants modest divergence from Europe and the other side wants to go it alone. As the noble Lord, Lord Hill, said, to govern is to choose. However hard it was inside her party, the Prime Minister should have adopted a clear position of principle from the outset and said that, because business needs stability in its dealings with Europe and has to protect its access to European markets, we will leave the European Union but continue in the single market and customs union. That would have given us a very advantageous negotiating position in Europe, where we would have met considerable flexibility and would have brought the whole country together—the 52% and the 48%.
I fully accept that that approach was not provided for in the referendum, but nor was it excluded. This is something that we should be clear about: the future relationship was not on the ballot paper. It cannot now be determined on the outer reaches of the Conservative Party as if the rest of the country does not matter. We are trying to come to terms with 40 years of intricate trading arrangements, intensified in recent times as a result of the single market, which Britain championed. That is why we should keep the economic disruption and damage to an absolute minimum and that, according to every opinion poll since the referendum, is the clear wish of the majority of the people.
We will not achieve this by Britain becoming a third-country exporter, like Canada, completely outside the regulatory perimeter of the EU, attempting to negotiate our goods and services back into Europe past a thicket of tariffs, customs and regulatory barriers, a world away from the frictionless trade that we now enjoy. The only option available to maintain frictionless trade in both goods and, crucially, services is to enter the European Economic Area, as Norway did when its people decided against EU membership in the 1990s. It is not perfect, because of the dilemma that we face: either we lose access to the European market that we need or we are bound by European regulation but lose our say, at least initially. That is the unpalatable choice presented by the referendum. It is joined to the further, difficult question of labour movement, but our starting point and guiding principle should be to put jobs and investment first.
The referendum result in 2016 cannot simply be ignored and no one is proposing to do so. The Government should be laying out all the options with enough clarity and detail that, before the final decision is taken on the implementation of the referendum, there is full debate and a truly democratic way of determining it. Ideally, in my view, this should be resolved by Parliament. Let us face it, though, as things stand both government and opposition parties are finding it hard to agree a way forward. So a referendum on a new question about the future relationship may become unavoidable, although that is not something on which we should be voting at this stage.
Brexit is the biggest decision that this nation has taken since the Second World War. We have to make a better job of it than the Government are doing now and Parliament must take seriously its responsibilities to ensure that the country does so. We should not duck that responsibility.
Lord Wallace of Tankerness (LD)
My Lords, as many noble Lords have already indicated, at one level this is indeed a technical Bill. If we are to leave the European Union, there is a legal and practical necessity to have continuity and certainty. However, as the noble Lord, Lord Mandelson, has just articulated so clearly and forcefully, it is impossible to ignore the context in which this legislation comes before us. Given its technical necessity, it is only fair that we ask whether it actually delivers in providing continuity and legal certainty. We have already heard the view of your Lordships’ Constitution Committee that as it stands it is constitutionally unacceptable.
Perhaps one of the clearest clauses in the Bill is Clause 1:
“The European Communities Act 1972 is repealed on exit day”.
That got me thinking. The European Communities Act 1972, a much shorter piece of legislation than this, has in fact stood the test of time. Yes, there has been litigation, but over 45 years it has performed its function remarkably well, notwithstanding the changes that have taken place since then. I dare anyone to suggest that the Bill that we are currently debating is anywhere near as robust and fit for purpose for such a major constitutional change. Its shortcomings will be well-rehearsed in this debate and scrutinised during its passage through your Lordships’ House, but I want to make a few remarks about it in relation to the devolution settlement. Here the Bill not only fails to deliver certainty; it undermines the certainty of that settlement, as the noble and learned Lord, Lord Hope of Craighead, forensically demonstrated in his contribution.
I believe the Bill turns the architecture of devolution on its head, more through a lack of proper thought and sensitivity than through malign intent. It also shows little respect for the devolved Administrations or for parity of esteem, which now seems to be out of the window. The structure of devolution in Scotland, as set out in the Scotland Act 1998, is that everything is devolved unless expressly reserved. That situation has stood the test of time. However, here we have proposals created by the Bill, especially Clause 11, where, in areas that otherwise fall entirely within devolved competence, extensive powers to amend retained European Union law fall to United Kingdom Ministers, rather than to the devolved Administrations.
I turn to two pieces of evidence given to your Lordships’ Constitution Committee. First, Professor Richard Rawlings of University College London said:
“At one and the same time, Westminster and Whitehall are freed up to shape a post-Brexit world in crucial respects, and the devolved institutions are locked down and required to wait for partial release”.
Secondly, Professor Tom Mullen of Glasgow University argues that Clause 11 alters,
“the framework of the devolution settlements by replacing a cross-cutting constraint on devolved competence with what is effectively a new set of reservations. It would also overlay the current reserved powers model of devolution with a conferred powers model in relation to retained EU law. This is not a mere technicality; rather the reserved powers model is a central element of the constitutional strength of the current devolution arrangements”.
These are quite bold statements from constitutional experts that go to the heart of what is wrong with the Bill as currently constituted.
While we will obviously deal with these matters regarding the structure of Clause 11, there are a number of other points that we will want to look at as your Lordships’ House considers the Bill in Committee. There is the apparent failure to recognise the statutory delay between a Bill passing in the Scottish Parliament and receiving Royal Assent, which is relevant for references to enactments in the Bill. Why is it that Scottish Ministers have some powers to deal with deficiencies in retained European Union law, but not if it is a deficiency in direct EU legislation, which is left solely for UK Ministers? No explanation has been given as to why that difference is made. Why are sweeping powers for UK Ministers found in Clauses 7 and 8 subject to a sunset provision, but apparently not the powers in Clauses 10 and 11, and in Schedule 2, which relate to powers relating to the devolved Administrations? Why is there a sunset clause for one set of powers and not for those that deal with the devolved Administrations? Absence of sufficient requirements for, or consultation with or consent from, Scottish and Welsh Ministers in devolved areas adds up to a disregard for the idea of parity of esteem.
The Government have accepted, and the noble Baroness the Leader of the House has said again today, that Clause 11 is deficient, and they have promised amendments. It is important that we know, as the Bill progresses, when we are likely to see these amendments. A legislative consent Motion is not a legal requirement, but we should all know that it is very much a political requirement if devolution and the fabric of our United Kingdom are to remain.
I believe we could have an opportunity to have a silver lining to the dark cloud of Brexit and do some things better in our arrangements with the devolved Administrations. The Welsh Assembly Government have floated the idea of joint ministerial committees on a statutory footing. We need ways to find better dispute resolution mechanisms than we have at the moment under the memorandums of understanding.
In its report on the Bill, the Public Administration and Constitutional Affairs Committee of the House of Commons, reflecting on Clause 11, said in its first report:
“A set of effective relationships based on mutual trust and effective communication and consultation are essential for the internal governance of the UK, following its departure from the European Union”.
I fear that the Bill as it stands does little to foster mutual trust. It suggests that there has been ineffectual communication and its drafting is conspicuously lacking in provision for consultation. In our deliberations and scrutiny, I believe we can start to make amends by making amendments.
Baroness Jones of Moulsecoomb (GP)
My Lords, I did something very controversial during the EU referendum campaign: I went against my own party’s remain position. I campaigned to leave the EU because the EU is a top-down project designed to promote endless industrial development and economic growth. It remains my strongly held belief that we can have a greener, fairer, healthier country by leaving the European Union. In taking this view, I feel a strong personal responsibility to Greens everywhere and to the country to do what I can to ensure that Brexit is a success for the environment. I still want to leave the EU, but I absolutely cannot support the Bill as it stands. The Constitution Committee has described the Bill as,
“fundamentally flawed from a constitutional perspective in multiple ways”,
but it is fundamentally flawed from an environmental and social perspective too. It remains government policy that through Brexit we will strengthen our democracy, protecting and enhancing environmental and social laws in the process. In its current form, though, the Bill will fail on all those aims and, sadly, the gaps in it will leave the environment as the biggest casualty.
The Bill does not do what it was promised it would do: it does not ensure that existing EU law is retained. In fact, it explicitly excludes certain aspects of EU law without any justification. For no clear reason it drops some fundamental principles of EU law, such as the precautionary principle that must currently be applied by courts, businesses and government. Additionally, the Bill retains EU laws without their accompanying preambles. This misses out, for example, the “polluter pays” principle from the environmental liability directive and loses the aim of biodiversity conservation from the habitats directive. These omissions lose crucial interpretive aids for the courts in some obscure attempt to squash a square peg into a round hole as we bring the body of EU law into the literal system of English law. I struggle to understand how the courts will continue to apply retained EU law when these essential principles are gutted from our jurisprudence. Indeed, senior judges have expressed the need for Parliament to make this as clear as possible. We are setting ourselves up for decades of legal chaos while we needlessly undermine our environmental and social protections.
I am warmed by the many promises this Government are making about ambitions for the environment and their pledges to bring forward legislation. However, I note a very deliberate change of tack in their approach to the Bill. No longer is it seeking to retain all EU law and bring everything into order to prepare for Brexit. The Government are now saying that a whole raft of other Bills are the correct place for retaining some of these really important parts of EU law. It is the promise of jam tomorrow, which we more or less do not accept. I suspect that this repositioning is a government tactic to avoid some very important amendments being made to the Bill while passing through scrutiny. There may well be better legislation in future in which we can establish the lasting legal frameworks that will define our post-Brexit lives, but we only have the Bill before us now and we cannot allow deficiencies in it to prevail in the hope that some future Bill may address them. We must amend and repair this Bill so that it is fit for purpose, and I hope there is sufficient will in this House for that to happen.
I shall speak on two issues in particular. First, on animal sentience, there has been a surprising amount of public support lately for this rather technical-sounding principle. We are a nation of animal lovers who understand in our hearts that living creatures deserve respect and care, and that humans should avoid their suffering as far as possible. The Government’s attempt to head off amendments to the Bill has been to publish a draft Bill recognising animal sentience, but that achieves the opposite of their intention by setting out a perfect example of how the Government could well fail to replace EU law with equivalent provisions. A legal opinion commissioned by Friends of the Earth has compared the provisions of the draft Bill with Article 13 of the Treaty on the Functioning of the European Union. Article 13 requires the state and its bodies to “pay full regard” to animal welfare. It has a very narrowly limited set of permitted exemptions. Contrast this with the draft Animal Welfare (Sentencing and Recognition of Sentience) Bill, which requires Ministers only to pay “regard” to animal welfare, balanced against other matters of public interest. This makes the relevant considerations a matter of fact to be assessed by the decision-maker, subject only to the relevant legal test of irrationality.
So animal sentience and animal welfare is an ongoing example of the withdrawal Bill failing to bring EU law across into domestic law, and of the Government’s proposed alternative legislation failing to give the same level of protection as exists in EU law. Far from setting a gold standard, it is a significant undermining of the current position. Accordingly, this makes me quite sceptical that the Government will be able to protect and improve on EU law in other Bills. It seems incumbent on us to fix whatever deficiencies exist in the Bill now so that we can be sure, when it goes to the other place, that they will have a good Bill to comment on.
The second issue is the Henry VIII powers contained in the Bill. The reports of the Constitution Committee have done a fantastic job of setting out these issues. I am sure that many learned Members of this House will cover the detail of the constitutional implications, so I will focus on the principles that are at stake. The Government are giving themselves some very broad powers, which could even be used to grant themselves more powers. I know that many civil liberties organisations are very concerned about human rights. Stonewall, for example, would like a clear commitment that LGBT people’s hard-won rights will be protected.
I want to be constructive; I remain supportive of leaving the EU, but the Bill before us is the wrong way of going about it. I am confident that the collective wisdom in your Lordships’ House will bring this Bill into a much more palatable form but, as it stands, I cannot possibly vote for it.
Lord Higgins (Con)
My Lords, this Bill and the debate on it clearly mark something of a milestone in the move towards Brexit. It is appropriate that we should therefore take stock of the situation we are now in. We are effectively debating the principle of the Bill, which tends to embody the result of the referendum. Not all that many of those in the Chamber today took part in the debate on the referendum Bill. I took an active part and what was absolutely clear was that the Government had introduced a Bill on a referendum which was advisory—it certainly was not mandatory—but this has been very carefully forgotten. Somehow, in the morning after the result was announced, the Prime Minister—perhaps somewhat surprised by it—came out treating it as if it were absolutely descended from the heavens and nothing whatever could be said in disagreement with it.
This raises the whole question of the role of referendums in our society. There is a popular view—not least in the Daily Mail and elsewhere—that referendums are democratic. They are not democratic in the sense of democracy as we mean it in this country, which is a representative system of democracy. They undermine that representative system. I certainly do not go along with the idea that we should have another referendum, and it is high time that Parliament asserted its position as far as that is concerned. My noble friend on the Front Bench said again today that we must honour the result of the referendum. It was the most sordid political campaign that I can remember in my lifetime—it was riddled with liars. Anyway, a majority of the British people did not vote for it. A large number realised that they did not understand the issues and decided not to vote, and even the majority of those who voted was not that large. So the argument that we must honour this seems a rather doubtful proposition.
The whole result of the referendum has been to undermine what we believe in this country: that Members of Parliament are representatives not delegates. Once you have a referendum they become, to a large extent, a delegate and not a representative, and do not have a chance to weigh up the arguments that are put forward. So, as far as that is concerned, we should take a more sceptical view than we have so far about the result of the referendum. The crucial thing is that, at the end of the negotiations, this House should make a decision. Another referendum might produce a result that I would be delighted with but, none the less, it is not the right approach. We, as a Parliament, have to reassert our position.
The other thing that puzzles me is that a doctrine seems to have emerged which says that, if you are in a negotiation, you must not say what you want, because that somehow undermines your negotiating position. This has been said quite explicitly, and the result is that the Government simply are not saying what they want. For example, on the crucial issue of the City of London there is a serious danger in the interim of people leaving and going to Frankfurt or wherever. We cannot have this degree of uncertainty. We must take a more positive line. Right at the beginning, when Theresa May took the referendum as mandatory, she seemed to rule out straightaway the customs union and so on, overlooking the fact that there is no conceivable answer to the Irish border problem if we do not remain in the customs union, in name or some other way. We should not have allowed that position to be eroded at such an early stage in the proceedings. We need to have a much clearer view of what the Government actually want. We have not been getting that. We desperately need it and soon.
Finally, we have in front of us a splendid report published by the Constitution Committee yesterday. It is very sad that the House of Commons did not have sight of this before they debated the matter. In all events, we now have it and it is really rather definite. It says:
“The Bill as drafted is constitutionally unacceptable”.
That is a nice clear statement. It raises the question of whether we should vote for the Bill. However, it goes on rather more optimistically to say that,
“its aims are valid and it can be amended to make it both appropriate and effective”.
We face the prospect of going through all the details to try to make the changes that the Constitution Committee has recommended. One ought to ask the Government whether it would not speed up the process—goodness knows we are running out of time—if they were to table amendments of the kind suggested by the Constitution Committee. We need to make progress and we need more clarity.
We certainly do not need any more referendums. I spend a lot of time in Holland. The newly formed Dutch coalition Government, having experience with a referendum on Ukraine, have come to the view that they should pass a Bill prohibiting any more referendums. I am heartened by that. Moreover, they would not have a referendum on whether you can have a Bill prohibiting referendums. That is something we ought to consider very carefully in this country.
Lord Rooker (Lab)
My Lords, can the Lords stop Brexit? No. Can we ask the Commons to think again and stop Brexit? Yes. First, we have to recognise the causes of Brexit. I have been back through the cuttings for the period before the referendum. Will Hutton in the Observer had it in a nutshell the week before. He listed loads of benefits of EU membership, but he went on to list a set of issues that the less well off and the left behind suffered from that left them wanting to leave the EU: lives are tough; bad jobs on poor wages; lousy housing; worsening public services. The list went on, while, he then said, the rich feather their nest. Most of the issues that are the causes of Brexit are not the EU’s fault. Many of the issues that are the causes of Brexit can be placed at the door of the 2010-15 coalition Government. But so what? It was a chance, for once, for the left behind to hit back.
Andrew Rawnsley pointed out before 23 June that,
“the telling of bare-faced lies has been rarer”,
in British politics if only for “fear among its protagonists” about their reputation when found out. He pointed out that the referendum had,
“introduced a novelty to British politics: the persistence with a lie even when it is verifiably a lie”.
The £350 million on the side of the bus and the 77 million people from Turkey, which was just about to join the EU, were indeed whoppers from public liars. That is the fact. We should recognise the causes of Brexit. Do not tell the people that they got it wrong on 23 June. They did not like the status quo and neither do I. The issue should be fixed where it started—in Parliament. It began with a Prime Minister betting his nation for party peace. He lost. The Lords must put country before party.
The nation is split in a way that I have not known in 44 years at Westminster. Mrs May has not shown the slightest concern about the 48% voting remain, nor the 63% who did not vote leave. I was committed to voting remain, compared with my no vote in 1975. I do not want the country damaged to prove my points, but I fear it will be several more months before the penny drops on the overall damage to the future in terms of jobs, the economy and a bleak future for generations to come.
The danger that Northern Ireland has been placed in is clear. There are international treaties relating to all-Ireland issues, such as food safety, animal disease, electricity supply and integrated dairy production, that Brexit cannot take account of. The island of Ireland has 15% of the world’s infant milk formula market—a world player that will be saddled with a hard border.
Evidence to select committees has shown that in subject after subject the outcome of Brexit will be negative. The UK is still a member of the EU, but a recent witness with first-hand experience stated to the committee that I serve on that the UK is already considered no longer “a key political actor” but a mere “technical consultant”—that was in our energy security report—yet we led on the creation of the single market in goods and then the internal energy market. The UK has never operated the opportunities to restrict the absolute free movement of labour, as provided for under EU rules, because the CBI and the fat cats desired total free movement to ensure low labour costs.
However, it is never too late to avoid making a bad decision. The bad decision is not that of 23 June but the actual departure. The people should be allowed to make an informed choice to leave or not. That was not on offer at the referendum. The electorate in 2019 will be different from that in 2016. The role of the Lords as the unelected revising and scrutiny Chamber is sometimes to ask the Commons to think again. I did not serve for 27 years in the Commons to undermine it from the Lords. The Commons will always have the last word. However, the facts on Brexit are better known now. There are fewer unknowns and more knowns.
The powers of the Lords are extensive but not used as we are unelected. We all know what the conventions are and we must abide by them in spirit and word. Any attempt to deviate from the conventions will force me to vote with the Government for the Bill. I will not mess about with abstaining. I will defend the conventions because I am concerned about what might be done in two or three years’ time.
I want the Bill to go back to the Commons amended in a variety of areas, not least giving the people the choice to leave or remain based on the evidence of facts, not lies from a soapbox. The key is that the Bill is amended in the interests of the whole nation, not a political tribe. The leadership of my tribe does not have clean hands on this issue because it has been a case of tribe before country. The big political tribes are not as they were before 23 June 2016. Within each there is a flock that has more in common with each other than the tribe that they are a part of. I recently sat in this Chamber listening to one of the most powerful and thoughtful speeches that I have ever heard on industrial policy, thinking to myself the deadly thought that if the noble Lord, Lord Heseltine, were the leader of a tribe, I could join it. He is not, so I remain where I am—for the moment.
Lord Campbell of Pittenweem (LD)
My Lords, it would be a brave tribe that took on the noble Lord. The noble Baroness the Leader, in introducing the debate, made a point of saying that this was a technical Bill. However, she has since had the experience of listening to the forensic dissection of the Bill by my brother advocate, the noble and learned Lord, Lord Hope. If the noble and learned Lord takes part in these proceedings in the way in which he foreshadowed, the government Bench will have to be about its business.
I do not believe it is possible to debate this Bill, technical or otherwise, without having some account of the political context in which it is brought. I want to deal first with the question of Scotland. I have little to add to what the noble and learned Lord or indeed my noble and learned friend Lord Wallace have said. However, the Government’s approach has been playing into the hands of those in Scotland who seek independence by blaming London for everything. If you want to give wind to the sails of those who wish for a second referendum in Scotland on independence, then continue to proceed in the way in which the Government have done so far. I cannot emphasise strongly enough the importance of accepting the nature of the relationship between the devolved parts of the United Kingdom. As the Constitution Committee pointed out in its report, failure to secure legislative consent would have “significant constitutional repercussions”. To that I would add, “and significant political repercussions as well”.
Another area of uncertainty to which noble Lords have referred is that of Ireland. I want someone to tell me, perhaps by the end of the two days of this debate, precisely what constitutional and legal mechanism the Government propose in order to achieve the fact of Northern Ireland continuing to have the same border arrangements with the south of Ireland but that does not involve membership of the single market and the customs union. I have seen no evidence that such a thing is possible. If the Government have it, let them tell us it now.
As if these things were not enough, we now have a Government who are infused with discord, weakness and ambition. Why is that so? Here I seek to answer the question asked by the noble Lord, Lord Higgins: it is not because they will not reveal their negotiating position but because they cannot agree one. They have said they want a good bespoke deal, but what is a “good” deal and what is “bespoke”? What is it that the Government actually want? It is not just Members of this House who want to find out; Mr Barnier and the 27 other nations of the European Union want to know what we want. So far, we have been unable to provide that because of the divisions in the Government and the Cabinet. As for Mr Macron, he came, he saw and he conquered. We gave him the red carpet treatment and he promised us the loan of a tapestry. The whole visit was an outstanding success until someone said: “What about access for financial institutions?”; to which he said, “Be my guest”. People’s hearts rose, thinking that this was all going to be easy, but then he added a coda: “Be in the single market, and be in the customs union”. That is deeply illustrative of the attitude that the European Union has taken and will continue to take.
In the meantime, the Brexiteers seem determined to undermine the Chancellor and, now, civil servants. If you undermine the Chancellor on Brexit, you undermine him on economic competence. The more that the Prime Minister is undermined by her party over questions of leadership, the more that she will be undermined in her capacity to negotiate with Mr Barnier. The more that she is undermined by her own party, the less influence she will have with President Trump on the proposed trade deal. The Prime Minister has had to cancel making a speech that she was going to make setting out the Government’s position, and is going to the security conference in Munich instead. If she has the same experience in Munich that the Foreign Secretary had last year, she will find that Brexit is on the table all time and that any effort to, as it were, hide behind the fact that this is a conference normally committed to discussing security will not provide a defence for her. I hesitate to say this but, in the light of the conduct of the members of the Conservative Party in the Cabinet, there must be the possibility that during the passage of the Bill through your Lordships’ House the Prime Minister could face a leadership contest. This is Chamberlain territory, and its consequences for this legislation are beyond understanding.
Finally, let me make this point. The noble Lord, Lord Dobbs, was quite right to refer to tumbrils. Those who want us to leave the European Union have already got their own committee of public safety. Mr William Rees-Mogg bids to be Robespierre, and he has threatened this House—
Lord Campbell of Pittenweem
Mr Jacob Rees-Mogg; one Rees-Mogg is very much like another. Mr Jacob Rees-Mogg has threatened us, and my answer to these threats is this: I am not here to thwart the will of the House of Commons. Like the noble Lord who has just spoken, I spent 28 years at the other end of the building asserting the primacy of the Commons, and I will not depart from that simply because I have been sent to your Lordships’ House. But I know what my duty is: it is to bring to the attention of the other House the manifest defects that exist in this legislation. We may not make them any wiser, but if we deal properly with this Bill, we will make them better informed—heaven knows they need it.
Lord Green of Deddington (CB)
My Lords, the noble Lord, Lord Adonis, referred to ex-Foreign Office luminaries. I am ex-Foreign Office, but I make no claim to be luminary; indeed, I am not entirely sure I agree with some of what it is saying.
I will cover rather different ground in my contribution, which, as usual, will be brief. Until I read the papers for this debate, I had not myself realised the extent to which the UK has been inexorably drawn into a binding legal structure so completely different from what the public, and I, originally voted for. However, the public have now come to recognise this, instinctively, if not in detail. That may explain why the outcome of the referendum was as it was: quite clear, but, as we have all recognised, narrow.
Irrespective of their own vote, many members of the public now look to the Government and to Parliament to get on with it and extract us from the European Union. In looking at this Bill, we must surely play it straight with the public. There are, no doubt, many valid and important legal objections to the Bill as drafted, but any impression that legal arguments are being used as a cover to frustrate the UK’s departure from the EU would be deeply damaging to the future of this House and, perhaps, to our political system as a whole, as the noble Lord, Lord Dobbs, pointed out earlier.
I would like to refer specifically to one central issue, which is something of an elephant in the room. Noble Lords will have guessed that I am talking about immigration. There is no doubt that this was a major issue—some would say a decisive issue—in the referendum. Therefore, surely the outcome of this process must lead not just to control over immigration but to a substantial reduction.
Let me illustrate the consequences of failure to get such a reduction in three brief, simple but telling points. First, over the last 10 years net migration has been running at about 250,000 a year, almost half of it from the European Union. Secondly, at these levels of immigration, our population would grow by almost 10 million in the next 25 years, of which 82% would be due to migration. Thirdly, the continuation of current levels of net migration to England—I am talking only about England here—would mean having to build a new home every five minutes, day and night, just to house new migrants. This is just the tip of the iceberg. Public concern about the scale of immigration is well founded and should not be condescended to. More generally, the public are also aware of something of an alliance between some employers who prefer to employ cheap foreign labour and a metropolitan elite who sometimes suggest that any call for control of immigration is essentially xenophobic. If nothing else, the vote for Brexit has signalled a need for this to change.
This is not the place or the occasion to pursue these matters any further. Indeed, the implementation Bill in the autumn and the immigration Bill expected shortly will be more directly relevant. In conclusion, I simply invite the House to be alert to the wider consequences of our work for the future size and, indeed, nature of our society.
Lord Strathclyde (Con)
My Lords, this debate deals with the consequences of overturning 50 years of British public policy, seemingly doing so overnight as a result of the referendum. My purpose in the debate is to follow those who have talked about the role of the House and how it should deal with the legislation before us.
As my noble friend the Leader of the House pointed out at the start, this is a process Bill. Whether it is a technical Bill or a process Bill—I am not entirely certain of the difference—it deals with a process. We will in future be faced with Bills that deal with a whole range of policy decisions that emanate from passing the legislation. The Bill was born out of the referendum and the passing, by substantial cross-party majorities in the House of Commons, of the Article 50 Bill. It follows the general election, when both main parties made certain commitments about honouring the will of the people as laid out in the referendum. That would have been the time for the political parties to change their minds if they were so to do. The Bill comes to us after a gruelling passage in the House of Commons, which you cannot always say about Bills that come from another place. In this case, no stone has been left unturned in seeking to improve it.
Our reputation outside this House is for debate, scrutiny and revision, and for doing so in an excellent manner. We should do this again on this Bill. However, what is different from almost any other political Bill that we receive is that we should do this in the most positive and constructive manner. There have been some very good hints at that in the debate so far. I echo what my noble friend Lord Hill of Oareford said a few moments ago. I encourage what I am sure the Government would want to do, which is to be constructive too. It is what people outside this House would expect of us. The House of Lords is always at its best when it is opposing the Government but doing so by being on the side of the people. My noble friend Lord Dobbs reminded us graphically of the consequences of not doing so by telling us about what happened in 1911.
I understand why some Members of the House and perhaps even the Constitution Committee should be concerned by some aspects of the Bill, particularly the extensive Henry VIII powers the Government have sought to give themselves. These are important powers and I expect the Government to explain in detail in Committee why they need them in the way they have asked for them. But there is also a responsibility on those who want to change them to explain and demonstrate how that change will improve the process of the Bill without gumming up the legislative works not only in this House but in another place.
It has always been my view, since I joined this House in the 1980s, that this is a Europhile House and always has been. The Government have no majority in this House. The noble Lord, Lord Rooker, reminded us of the important powers that reside in this House, and the noble Lord, Lord Adonis, has in part used those by proposing an amendment. I really do not think this is the Bill on which we should use those extensive powers. Differences exist within the parties – more so, sometimes, than between them. If the Bill is to be amended, then let it be done with co-operation and consultation between Back-Benchers and Ministers, so that when we eventually send it back to the House of Commons, it says something important about our ability to make a change in the House of Lords.
Lord Hain (Lab)
My Lords, this Bill offers possibly the last guaranteed parliamentary opportunity to change the Government’s Brexit strategy, prevent a hard Irish land border and protect all the precious gains of the Good Friday agreement. To achieve that, since the DUP has quite understandably insisted that Northern Ireland must not have a separate constitutional status from the rest of the UK, surely not just Northern Ireland but the whole of the UK must stay in the single market and the customs union.
As the CBI, supported by the TUC, has made crystal clear, our businesses do not want to be cut off from their largest markets, or from the EU’s regulatory bodies that guarantee our access to them, in return for promises of jam tomorrow in far-flung emerging markets. UK services exports to Europe are around 60% higher than those to the US, and twice those exported to Asia. The 11 countries in the Trans-Pacific Partnership, favoured as an alternative by Brexiteers, account for only 7% of our trade, while Germany alone accounts for 11%.
As for the claims that, once freed from the EU, the UK can negotiate preferential trade deals with third countries, the truth is that we already have 60 such deals through the EU that unless renegotiated in time, which is highly unlikely, will actually cease to apply after Brexit—that is, by March 2019. Furthermore, with a market of over 500 million people, the EU often negotiates trade deals that are far more comprehensive in scope than those achieved by individual countries outside the EU, so the likelihood of the UK getting even better terms with third countries than we already have through the EU is minimal. Remember that many non-EU countries, such as Japan, invest here because of the level of access that they currently have from the UK into that larger EU market; access that their UK-based companies will lose once we are no longer in the single market and the customs union.
Trade deals take years to negotiate. They are usually designed to secure the convergence of standards and regulatory regimes, not divergence, which is what Brexiteers want in relation to the EU. Moreover, because of the EU’s internal budget timetable, Brussels is now suggesting that the transition period should finish at the end of 2020, after just 21 months. There could then be a dramatic cliff edge, with queues of lorries stretching for miles in Kent and gridlock on the roads of Northern Ireland. This is the true prospect for Brexit Britain, not the fantasies of the Government and the Brexiteers.
Another government fantasy is more ominous. No one who really understands the complexities and dangers of politics on the island of Ireland seriously believes that keeping the border open can be achieved without Northern Ireland staying in the same single market and customs union as the Irish Republic. The 8 December agreement requires the UK to retain “full regulatory alignment” with the EU to prevent a hard border with customs posts and security checks. Meanwhile British Ministers, divided over what was actually agreed, waffle about a high-tech frictionless border. They remain in denial about the reality that, for the European Union, protection of the integrity of the single market—which is a legal construct, not a political arrangement—means that you cannot be half in, half out.
It is important to recall that the 1998 Belfast Good Friday agreement, and the peace process which followed, was explicitly designed to depoliticise the Irish border by making it completely open. Any restriction whatever would completely undermine the agreement, which, by the way, formed an international treaty with the Irish Republic, recognised by the European Union. Border posts, customs personnel and surveillance technology could provide sitting targets for dissident republican paramilitaries to rerun the IRA’s border campaign of 60 years ago, also provoking the reactivation of their loyalist paramilitary counterparts to defend Ulster.
Worryingly, Dublin’s and London’s interpretations of the December first-phase deal are very different. The EU sees it as binding Northern Ireland and the whole of the UK to the EU’s regulatory domain; the UK sees it as merely an outline containing work in progress, with the Cabinet divided and unable to resolve the implications. The contradiction is that EU rules do not permit frictionless trade while Northern Ireland—and by extension the UK—is outside the customs union and the single market. Remember too that the Good Friday Belfast agreement is not only of constitutional and institutional importance; it requires a shared regulatory structure for cross-border movement, trade and co-operation.
Surely our duty in your Lordships’ House is therefore to act over this Bill for the whole of the UK and not just for part of the Conservative Party. Surely we have to persuade the Government to stay in the single market and the customs union to protect our economy and, above all, to protect the Good Friday agreement and avoid the catastrophe of a hard Irish border. Everyone says that they do not want such a border, but we are accelerating remorselessly towards it, as long as the Government remain so dogmatically rigid about the terms of Brexit.
Baroness Hamwee (LD)
My Lords, I asked a sixth-form politics class the other day what the phrase “House of Lords” brought to mind. I expected “ermine”; I got “not elected”, “scrutiny” and “red”—spot on, of course, as regards the issues arising from this Bill, though I will happily discuss tapestries with the noble Lords, Lord Dobbs and Lord Campbell.
I recently asked a Question about Home Office statutory instruments derived from EU legislation. The Answer was,
“we are not in a position to give a sense of scale at this time”.
That was as recently as last month and it encapsulates the widespread view that the Government are floundering. Even if they do not agree with the policy, people expect competence and coherence.
The procedures that the Bill puts in place must be fit for the job—quite some job. This of course includes, as noble Lords would expect me to say, seeking the opinion of citizens—a word I am more comfortable with than “people”—on the terms. I am of course concerned, as others are, about the powers that the Executive seek to keep for themselves, and about public bodies which may not put transparency, let alone accountability, high on their agenda.
This House’s culture, as we would all agree, is one of rigour in its scrutiny. We should not only capitalise on that, but address how we co-ordinate with the Commons and not simply operate in parallel with it. We should also address the absence of real power to deal with what may be secondary but is after all legislation, which is maybe a big part of the reason why the Commons have over the years been less focused than we have on statutory instruments. The term “appropriate” is one which, to my mind, should rarely have a place in legislation. What is appropriate is often in the eye of the beholder. We are lucky to have such big brains here who can see both the big picture and the detail regarding, among other things, delegation and legal certainty.
One of the big rule-of-law issues is the non-retention of the European Charter of Fundamental Rights, singled out as the exception to the objective of continuity. The Government assert that it is unnecessary, the noble Baroness the Leader of the House today used the term “reaffirms” and occasionally the Government claim that it adds “extra” undesirable rights, although I cannot quite reconcile all of those. The Joint Committee on Human Rights, of which I am a member, has corresponded with the Secretary of State about the charter. I felt as confused as Alice, though perhaps without the wonder, by some of the responses. To a request to list the instruments that underpin the provisions of the charter but which are not incorporated into domestic law, we were told:
“We are not entirely clear which instruments are being referred to”.
Well, quite; that was our point. The JCHR has published a commentary on the Government’s right-by-right analysis of the charter, dealing, crucially, with the remedies by which those rights are enforceable, from Article 1, the right to human dignity, which is not a distinct right set out in the ECHR so there is no enforceable right conferred on individuals, to Article 50, the right not to be tried or punished twice for the same offence, to which the same, although we have the common-law protection. I hope the JCHR’s work will be helpful to noble Lords’ dissection of Clause 5.
Lastly, I want to refer to another major uncertainty, this time a personal one: that of EU citizens in the UK and of British citizens elsewhere in Europe. We were all told there would be no change to our laws the day after exit day, while they were told their position would be unaffected. That is patently not the case, since they are going to have to apply for status. They were the “first priority” but the Government gave every appearance of being dragged towards items in the progress report of last December, and of course they are within the caveat of “nothing agreed until all is agreed”. There will be immigration rules and the more complicated they are, the greater the likelihood of errors, with an added hurdle provided by the Data Protection Bill regarding restrictions on access to data where immigration control is concerned. Meanwhile there are deportations of EU citizens that are not in accordance with the directive, which allows only for cases of current threats to society or security. I mention that with a view to the nature of our society, but sadly the noble Lord is no longer in his place.
Recently I was asked by someone in his 20s what the major considerations were at the time of the 1975 referendum. I talked to him about the aim of “No more war in Europe”. He was very struck by how that has morphed into economic arguments. Well, not entirely: this is about individuals’ lives.
Lord Butler of Brockwell (CB)
My Lords, I apologise to those noble Lords who thought they had reached their lunch break; my name is hidden in the spillover on the second page of today’s speakers list.
I do not disguise the fact that the wording of Clause 1 of the Bill:
“The European Communities Act 1972 is repealed on exit day”,
strikes a dagger to my soul. My career has been long enough that I remember the difficulties with which the UK negotiated membership of the European Economic Community, and I have been conscious of the benefits that our country has derived from the membership of what has now become the European Union. Having said that, I think I understand why the 52% voted as they did.
The rush towards a federal union is a mistake and may lead to disaster. Nevertheless, there is one thing that is worse than being a member of the EU—not being a member of it.
The United Kingdom being motivated by an illusory quest for independence, in a world which becomes more interdependent day by day, is a painful prospect. It becomes more so when the UK appears to be carried along on a tide of narrow nationalism which has brought so much trouble to Europe and the world. However, I shall not vote against the Second Reading of the Bill, nor shall I support any attempt to delay it. Given the decision of the British people in the referendum, and the notice given with the assent of Parliament under Article 50, I agree with those who say that the Bill is necessary so that there is not a void in UK law if and when we leave the EU.
Ever since the referendum I have argued that the British people are entitled to a further say when the terms of the UK’s departure are known. However, I agree with the Leader of the Opposition, and other noble Lords, such as the noble Lord, Lord Mandelson, who said that this Bill is not the appropriate vehicle to require a further referendum. I shall, however, support any amendments which may be necessary to ensure that a further referendum will be among the options when Parliament is given a meaningful vote at the conclusion of the negotiations.
There is clearly a substantial job for your Lordships to do on this Bill within our normal constitutional role of scrutiny, improvement and giving the Commons an opportunity to think again. There are areas where the Government have said they will bring forward further amendments, for example on the relationship with the devolved assemblies. The role of the House of Lords in scrutinising delegated legislation, introduced under Henry VIII clauses, needs to be clarified. There are important issues relating to the interpretation of judgments of the European Court of Justice and the place of the European Charter of Fundamental Rights. As has been said, we owe a great deal to the House’s Constitution Committee in identifying these areas and suggesting remedies.
I believe that there is a job for this House to do, without straying beyond its proper constitutional role. I share the hope that we will do it firmly but constructively.
BBC: Brexit
(6 years, 10 months ago)
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Lord Pearson of Rannoch
To ask Her Majesty’s Government what assessment they have made of the Civitas publication The Brussels Broadcasting Corporation? and of the BBC's coverage of Brexit, set against its new Charter and guidelines.
Lord Pearson of Rannoch (UKIP)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper, but not as it appears on the speakers list for today.
The Parliamentary Under-Secretary of State, Department for Digital, Culture, Media and Sport (Lord Ashton of Hyde) (Con)
My Lords, the Government have not made an assessment of the Civitas report The Brussels Broadcasting Corporation?, as the BBC is operationally and editorially independent of the Government. Under its royal charter, the BBC has a duty to deliver impartial and accurate news coverage and content. The BBC is also subject to the Ofcom Broadcasting Code, which requires that news is reported with due accuracy and presented with due impartiality. As the new external regulator of the BBC, Ofcom can also consider complaints relating to the BBC’s output.
Lord Pearson of Rannoch
My Lords, I thank the Minister for that predictably bland reply, but the Brexit Secretary, Mr David Davis, said to me recently that his job in Brussels is made even more difficult if, every time he makes a small advance there, he is promptly undermined by the BBC. Are the Government aware that the BBC cannot give a cross-party group of MPs an example of a single programme since the referendum which has examined Brexit opportunities—not promoted them, just examined them? Secondly, is it acceptable that the BBC has not debated the ideas behind the project of European integration and whether they are still valid today?
Lord Ashton of Hyde
The noble Lord comes from a particular viewpoint, and we understand that he takes its coverage very seriously. He knows that the royal charter has made the BBC independent, and it is very important that Ministers do not get involved in the editorial opinions and conduct of the BBC. That independence is guaranteed in Article 3 of the royal charter. Secondly, there is an established complaints procedure. What is different now is that there is a unitary board holding the director-general, who is the editor-in-chief, responsible and that Ofcom, which has a code, is for the first time the BBC’s regulator, so the noble Lord can also complain to Ofcom.
Lord Richard (Lab)
My Lords, is the Minister aware that the noble Lord, Lord Pearson, and those of his ilk would not be satisfied if every programme that the BBC broadcast on current affairs started with a litany which said, “Confusion to the Commission and down with the tyrannous EU!”? That would not be enough for them. It is vintage Trump: “I didn’t say it. If I said it, I didn’t mean it. If I said it and meant it, nobody believed it”. It is the last screech of a dying cause.
Lord Ashton of Hyde
My Lords, I think the noble Lord, Lord Pearson, is much more balanced than that. He knows that a small portion of Brussels is part of a healthy and balanced diet.
Lord Tebbit (Con)
My Lords, I do not blame the Minister for the Answer that he read out, but does he not think as an individual, a private person, that there is something wrong when, out of 4,275 guests talking about the EU on BBC Radio 4’s “Today” programme between 2005 and 2015, only 132, or 3.2%, were supporters of the UK’s withdrawal from the EU? Frankly, the BBC has become the supporter of a foreign organisation called the European Union. Could not the Minister quietly whisper in somebody’s ear, “Get your act in order, because you owe a duty of impartiality”?
Lord Ashton of Hyde
I agree with my noble friend that the BBC owes a duty of impartiality. I do not think anyone is particularly interested in my views as a private person, but as a Minister I care that Ministers keep out of editorial decisions. This question of impartiality is largely a matter of opinion. For example, I happened to read a letter to a pro-European website, which complained that the BBC had put Nigel Farage on Question Time 31 times since the programme began.
Baroness Bonham-Carter of Yarnbury (LD)
My Lords, following on from that, does the Minister not agree that every political party, including my own, and factions within every political party complain about BBC coverage, particularly on Brexit? Yet the BBC has clearly been successful in following the impartiality guidelines put forward in the new charter.
Lord Ashton of Hyde
I think the BBC does a very difficult job well, but it is for members of the public, including noble Lords, to follow the complaints procedure—which is easy to do. The BBC receives, I think, 200,000 comments on its programmes per year. As I said before, Ofcom is there to make sure they stay within the code.
Viscount Colville of Culross (CB)
My Lords, as we abandon EU institutions, does the Minister agree that we should be bolstering rather than bashing our great British institutions? One of the most internationally respected and well-known of those that need bolstering is the BBC.
Lord Ashton of Hyde
The BBC needs support when it does things well; it also needs to get its house in order when it does things wrongly.
Lord Tomlinson (Lab)
My Lords, having referred to Mr Nigel Farage, does the Minister agree that, if by some chance Mr Farage were to become leader of UKIP once again, he has already had his quota of appearances at the BBC?
Lord Ashton of Hyde
As I have said, it is not up to the Government to express an opinion on editorial matters.
Lord Hamilton of Epsom (Con)
My noble friend referred to the complaints procedure of the BBC. Can he quote any instances where complaints about political bias have been upheld?
Lord Ashton of Hyde
There are about 3,000 comments a day—I do not know the details of any complaints.
Baroness Smith of Basildon (Lab)
My Lords, is it not the case that, when somebody complains about political bias in the media, it is normally because they do not like what the person they are listening to is saying, rather than because of any real bias? In the days of fake news, does the Minister not accept that people have more faith in the BBC and national newspapers than in social media, which is completely unregulated, with anyone saying what they want? The noble Lord, Lord Tebbit, referred to the “Today” programme—some of us rather admire the way presenters on the “Today” programme interrogate people, whatever their views or political persuasion.
Lord Ashton of Hyde
The noble Baroness is right: trust in media sources is measured each year by a survey, which clearly shows that the public believes radio and television more than it believes social media. Radio and television get a 74% to 77% approval rating, whereas social media gets a mere 15%. Members of the public are not fools.
Brexit: Negotiations
(6 years, 10 months ago)
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Baroness Walmsley
To ask Her Majesty's Government who is conducting the negotiations for the United Kingdom leaving the European Union; and to whom that person reports.
The Minister of State, Department for Exiting the European Union (Lord Callanan) (Con)
My Lords, the Secretary of State for Exiting the EU, the right honourable David Davis MP, is responsible for conducting negotiations with the EU in support of the Prime Minister, including supporting bilateral discussions on EU exit with other European countries. DExEU supports this work by co-ordinating and overseeing negotiations and establishing a future relationship between the UK and the EU.
Baroness Walmsley (LD)
My Lords, is it not common knowledge that the Prime Minister has shifted the focus of negotiations to a competent official in the Cabinet Office, because she has lost confidence in a Brexit Secretary who complacently thinks the whole the matter is simple? His incompetence was proved by the shambles in the first stage of negotiations, which was only ended by a fudge on the Irish border. Will the Minister clear the matter up once and for all today, by telling the House how the Government plan to avoid a hard border while also leaving the customs union?
Lord Callanan
The first part of the noble Baroness’s question is totally wrong. The Secretary of State is doing an excellent job, and the Prime Minister is doing an excellent job in conducting the negotiations. We have said many times that we will avoid a hard border in Northern Ireland, and that remains the case.
Baroness Rawlings (Con)
My Lords, how many of the negotiations are now taking place with the Bulgarian Ministers, as it is their presidency at the moment?
Lord Callanan
We are conducting a wide range of discussions with all EU member states. I myself am visiting one on Thursday and Friday, and other Ministers are doing the same. We are advancing the UK’s cause and lobbying other member state Governments in advance of the full and special partnership that the Prime Minister has suggested.
Lord Foulkes of Cumnock (Lab)
Could the Minister help me? [Laughter.] Somebody might be able to. As well as reporting on all matters concerning his department to this House, what matters in the department are specifically devolved to him, for his responsibility?
Lord Callanan
I am always very happy to help the noble Lord, although I am not sure that my help is the help that he needs—but I shall do my best. I have responsibility for attending the General Affairs Council; for liaison for existing EU business; for the small matter of helping to get the withdrawal Bill through this House; and for liaison with the devolved Administrations in conducting ongoing EU business.
Lord Wallace of Saltaire (LD)
My Lords, given that the issues at stake in negotiating Brexit cover almost every department in Whitehall, is it not unavoidable that this has to be dealt with from the Cabinet Office, the co-ordinating department, and by the Cabinet itself, rather than DExEU? Is that one reason why there is apparently so much discontent within DExEU, and why it has four times the turnover of civil servants compared with the rest of the Civil Service?
Lord Callanan
I do not think that there is any discontent within DExEU. When the department was established, a number of officials were seconded from other government departments, and a number of them have returned to their original departments. But the noble Lord is right—these negotiations are complex and impact on a whole range of policy areas. Most departments in Whitehall are involved in one way or another, so of course it is important to co-ordinate that work, which is done both in DExEU and in the Cabinet Office.
Lord Forsyth of Drumlean (Con)
My Lords, how helpful does my noble friend think it is to the British national interest to have people sniping from behind the scenes at our negotiators at this crucial time?
Lord Callanan
Well, the noble Lord knows that I admire greatly his contributions on these subjects, but perhaps on this occasion he is not quite correct. The normal process of parliamentary scrutiny is appropriate. We, of course, as Ministers welcome the opportunity to account to your Lordships’ House; we will be doing that extensively over the next few months and have done over the last few months. Of course, it would be nice to see a bit more support of our position sometimes. Nevertheless, most people take a responsible attitude and want to question and probe us on the process, which is absolutely correct.
Lord Stevenson of Balmacara (Lab)
Can the Minister help us on the paper that has apparently been leaked? I know that he will not talk about the details of any leak—but on a paper that deals with the impact on GDP and various scenarios that affect us about Brexit, clearly, it would not be a leak if important documents like this were routinely made available to parliamentarians and others and we could then discuss them properly. I hope that there will be an opportunity for that.
Secondly, the paper apparently suggests that deregulating areas such as the environment, product standards and employment law could be an opportunity for the UK going forward. Who commissioned that paper? Is it true that it was his department and, if so, is that his negotiating position?
Lord Callanan
The analysis to which I believe the article refers is a preliminary attempt to improve on the flawed analysis around the EU referendum. It is there to test ideas and design a viable framework for the analysis of our exit from the European Union, and at this very early stage it considers only off-the-shelf trade arrangements that currently exist. We have been clear that those are not what we seek in the negotiations. It does not consider the desired outcome—the most ambitious relationship possible with the European Union, as set out by the Prime Minister in her Florence speech.
Lord Watts (Lab)
My Lords, is the Minister more worried about the sniping from this side of the Chamber or from his own?
Lord Callanan
I must apologise: I did not hear the question. Would the noble Lord mind repeating it?
Lord Watts
I asked whether the Minister was more worried about sniping from this side of the Chamber or from his own side.
Lord Callanan
One person’s sniping is another person’s constructive comments. I enjoy engaging with this House, sometimes on destructive comments, but we have considered appropriate contributions from all parts of this House.
Lord Hamilton of Epsom (Con)
The noble Baroness, Lady Walmsley, raised the issue of the Irish border. Is it not very difficult to get a solution to the Irish border issue that is separate from the trading relationship that we have with the rest of the EU?
Lord Callanan
We have made it clear that we do not want a hard border in Ireland. The exact structure of the border and customs arrangements will, of course, emerge from the end-state negotiations. Where we end up will clearly have an impact on the border arrangements, and we have made that very clear.
Climate-related Financial Disclosures
(6 years, 10 months ago)
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Baroness Featherstone
To ask Her Majesty’s Government what assessment they have made of the ability of companies to apply with consistency the recommendations of the Financial Stability Board’s Taskforce on Climate-related Financial Disclosures.
The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)
My Lords, Her Majesty’s Government have endorsed the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures and encouraged all publicly listed companies to implement them. We are seeking views on companies’ ability to apply these recommendations with consistency through the work of the green finance task force and the recent streamlined energy carbon reporting consultation.
Baroness Featherstone (LD)
But that is voluntary. Do the Government agree with big investors in the UK economy such as Aviva that climate disclosures should now be mandatory, to set the pace for innovation and ensure that the UK secures competitive advantage amid the global race to green the financial system?
Lord Henley
My Lords, that is one view. It was looked at by the Environmental Audit Committee inquiry on green finance, which sought evidence on the effectiveness of the TCFD’s recommendations and the Government’s role in supporting their implementation. There is broad consensus among stakeholders that companies will certainly require more time to implement the recommendations but some have recommended making disclosure mandatory within, say, two to three years. The Government have not yet taken a view on this matter and will consider it in due course.
Baroness Jones of Whitchurch (Lab)
My Lords, it is estimated that listed companies account for around a quarter of global carbon emissions, with oil companies obviously among the biggest polluters. Therefore, does the Minister agree that investors should have a responsibility to demand that those sorts of multinationals, in addition to individual countries, sign up to the Paris Agreement and set out their business strategy for a net zero-emissions world? That is the only way that we are going to tackle this issue on a global basis and ensure that we protect shareholder investment.
Lord Henley
My Lords, I accept what the noble Baroness is saying: that is very useful information for investors and others who are interested in what the companies are up to. We explicitly ask for feedback on those TCFD recommendations and whether they should be mandatory in the long run. However, one has to balance against that the fact that it potentially imposes a burden on businesses, and one would have to look at how exactly that should be done. At the moment it is not mandatory. We will consider that in due course, but at the moment it is best that we analyse the responses we have had to the various consultations and then come forward with our recommendations.
Viscount Ridley (Con)
Does my noble friend agree that climate-related financial disclosures should take into account the fact that the consensus among climate economists and, indeed, in the Intergovernmental Panel on Climate Change, is that the economic impacts will be positive for the next 40 or 50 years?
Lord Henley
My Lords, my noble friend makes another point. If these impacts are going to be beneficial, there will be an even greater reason for companies to wish to list them in their financial disclosures. As I said in response to other questions, whether we make them mandatory is obviously a matter we want to consider in due course.
Lord Teverson (LD)
My Lords, the City recently released an excellent report, Fifteen Steps to Green Finance. One of its recommendations was that the UK should set up a green finance standards board. That would enable this country to take that sector of the finance market and call it its own, set standards globally and make sure that issues such as greenwash did not undermine that concept. Will the Government take that on? Should they not do it urgently to make sure that we corner that market globally?
Lord Henley
My Lords, that is something else we can consider. Quite a lot of task forces and other boards exist at the moment; the Question itself relates to the task force on climate change and financial disclosure, set up by the Bank of England, and there is our own green finance task force. There is also the consultation I referred to earlier—consultations seem to be coming out of our ears. But I will certainly look at what the noble Lord said; whether it is right to set up yet another body is another matter.
Baroness McIntosh of Pickering (Con)
My Lords, the Secretary of State for BEIS has given conditional approval to Third Energy to hydraulically fracture in North Yorkshire, very close to or under the national park. What checks are being conducted into the financial probity of Third Energy, which has failed to lodge its accounts for the last financial year?
Lord Henley
My Lords, I would rather not answer that question without notice. It goes slightly beyond the Question on the Order Paper, but I will certainly write to my noble friend about it.
Women: Events Industry
(6 years, 10 months ago)
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Baroness Hussein-Ece
To ask Her Majesty's Government what steps they are taking to protect women who work in the events industry, following reports of harassment at the recent Presidents Club Charity Dinner.
The Minister of State, Home Office (Baroness Williams of Trafford) (Con)
My Lords, we condemn all forms of workplace harassment, which is unlawful under the Equality Act 2010. The Government are looking at all aspects of the wholly unacceptable behaviour which is alleged to have happened at the Presidents Club dinner. The Prime Minister has committed to reviewing non-disclosure agreements and any evidence that comes forward. The EHRC has sent a pre-enforcement letter to the Artista agency raising concerns about its actions, and the Charity Commission is considering whether further regulatory action is needed for charitable trusts.
Baroness Hussein-Ece (LD)
I thank the Minister for her reply. Many reports on this incident have claimed that the women employed at the recent Presidents Club charity dinner knew what they were letting themselves in for, yet of the 360 male guests, none saw what was going on and apparently they all left early. This has exposed the fact that these women, some as young as 18, were required to sign their rights away under gagging clauses, and were not allowed to talk about or report any sexual harassment or discrimination. How will women be protected from these crimes that may be committed against them, and how can they be made aware of their rights?
Baroness Williams of Trafford
My Lords, it is important to understand that non-disclosure agreements, which I think the noble Baroness is referring to and which are sometimes called confidentiality agreements, may legitimately form part of a contract of employment. But these would be legitimate to protect trade secrets, for example. They cannot preclude an individual from asserting statutory rights, either under the Employment Rights Act or the Equality Act 2010.
Lord Storey (LD)
My Lords, I thank the Minister for her detailed response, which was helpful. The obtaining of charitable status brings responsibilities, and many people are shocked that the Presidents Club was a charity. Will the Minister elaborate a bit more on guidance that is given to charities—surely there is no place for a charity to issue gagging orders or confidentiality agreements—and please ensure that this is a thing of the past?
Baroness Williams of Trafford
My Lords, every time something like this happens we hope that it is a thing of the past, and there have now been quite a few occasions at which this sort of behaviour has gone on. The Charity Commission is interested in this matter because of whether this charity acted in accordance with the rules.
Baroness Gale (Lab)
Does the Minister agree that Section 40 of the Equality Act 2010 was an important provision, providing protection for employees against harassment from third parties? Unfortunately, the coalition Government repealed the section in 2013, even though they held a consultation and 71% of people said they would like to keep it in. Does the Minister agree that Section 40 should be reinstated in order to guarantee legal protection against harassment from third parties, and would she go further and revise it so that it requires only one previous incident of third party harassment instead of the previous requirement of two or more? In that way, all those who experience harassment, wherever they work, will have some measure of protection.
Baroness Williams of Trafford
My Lords, the noble Baroness is absolutely right. In 2013, the coalition Government did indeed repeal specific provisions of Section 40 of the Equality Act 2010 which explicitly made an employer liable where they knew an employee had been harassed at work by a third party on at least two previous occasions and failed to take reasonable steps to prevent it. These provisions, as well as being quite confusing, were considered redundant, as an employer can be liable for third party harassment under the ordinary harassment provisions in Section 26 of the Act.
Baroness Afshar (CB)
My Lords, given that these young women are not very confident, is it not unreasonable to expect them to read gagging orders, find out what the problem is and then deal with it? Would it not be better to put the responsibility on the employers, who should not be employing them in the first place with this kind of responsibility?
Baroness Williams of Trafford
My Lords, I think the noble Baroness has made the point that I was trying, perhaps not very articulately, to make. A gagging clause will not, in and of itself, protect an employer or someone who is, say, employing, a waitress for an evening. In fact, it will go further than that and void that contract or agreement.
Baroness Walmsley (LD)
My Lords, does the Minister agree that if you want to influence the behaviour of men you should start when they are boys? That is why it is very important that the curriculum for PSHE lessons includes elements that ensure that young people leaving school understand that both genders should be properly respected.
Baroness Williams of Trafford
The noble Baroness makes a very good point. It is only in educating our children through PSHE, relationships and sex education that that culture of respect towards one another, the opposite sex, and, for young girls, towards themselves, will change.
Lord Anderson of Swansea (Lab)
My Lords, will the Minister give wide publicity to the fact that confidentiality clauses in such agreements are null and void, and can in no way give rise to a course of action?
Baroness Williams of Trafford
I hope that if any good can come out of this pretty grubby incident, it will be to highlight the fact that employers, or, indeed, people employing casual staff for the night, cannot hide behind confidentiality or gagging clauses if this sort of behaviour goes on, because they will be void.
Baroness Corston (Lab)
Has it crossed the Minister’s mind that the only reason we know about this is because a journalist went undercover and was able to reveal that it was happening? How would one of those young women have complained, and to whom?
Baroness Williams of Trafford
The noble Baroness makes a very good point. The person who raised this was a journalist and she was also a woman. I understand that the Presidents Club has been meeting for 33 years and this is the first time, to my knowledge, that this sort of behaviour has been reported at one of its events.
Automated and Electric Vehicles Bill
Tuesday 30th January 2018
(6 years, 10 months ago)
Lords ChamberRead Full debate Automated and Electric Vehicles Act 2018 View all Automated and Electric Vehicles Act 2018 Debates Read Hansard Text Amendment Paper: Report Stage Proceedings as at 29 January 2018 - (30 Jan 2018)
European Union (Withdrawal) Bill
(6 years, 10 months ago)
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Lord Bridges of Headley (Con)
My Lords, the years of Brexit are like dog years—each one feels like seven—so it feels like about a decade ago that I was sitting in DExEU talking to officials about the drafting of this Bill. Back then, the Bill, which cuts and pastes EU law into UK law, had been given the thoroughly Orwellian title “The Great Repeal Bill”, which is probably the best example of double-think that I have ever come across. The Bill’s title has changed but its purpose has not. To sum it up in one sentence, its purpose is to ensure that the UK leaves the European Union in a stable and orderly way.
I know full well that many of your Lordships have misgivings about various aspects of the Bill and many of those misgivings boil down to two words: parliamentary sovereignty. I have more than some sympathy, for when I was a Minister I struggled with some of the issues that the UK’s withdrawal raises, and perhaps I may focus on just two.
The first is the Henry VIII powers. I was, and remain, very wary of giving any Government Henry VIII powers but, if we are to leave the EU in an orderly way, I see the necessity for these powers so long as they have appropriate safeguards. That is why, as a Minister, I took the view that the powers should be limited and have a sunset clause, otherwise the Government would have the mother of all Henry VIII powers. No doubt they would be dubbed by the historians among us “the Elizabeth of York powers”.
Does the Bill get the balance right so that the Government have sufficient powers and Parliament sufficient scrutiny? We can and must debate that. Yesterday’s very thorough report from the Select Committee on the Constitution contains a number of points that certainly merit consideration by Ministers. However, let us not forget a simple point. If we were radically to dilute these proposed powers, the more primary legislation we might need to pass, the longer that would take and the more uncertainty we might create—more uncertainty and a greater risk of a disorderly exit. However one voted in the referendum, surely one thing that unites us is a wish for the process of our leaving to be orderly and stable.
The second conundrum is where powers lie once they have been repatriated to the UK. Here, the overriding aim must be to protect the integrity of the United Kingdom’s single market but, until the final shape of our new relationship is known, it is difficult to be completely clear about which powers currently held in the EU will lie where in the UK. This is why, as I have argued before, we must clarify the outline of the future EU-UK relationship in the current set of negotiations in Europe and we must have a transitional period during which all existing arrangements here in the UK and in our relationship with the EU remain the same. That will give us time to negotiate the details of the EU-UK relationship and we can resolve where repatriated powers should lie within the UK. We need to achieve this agreement with the EU about the transition and, crucially, the shape of the final agreement this year.
That brings me to my final point, which is also about those two words—parliamentary sovereignty. Four months ago, I asked a very simple question in this House: what is the country we wish to build once we have left the European Union? Only once we have answered this question can we properly and fully answer the second question: what agreement do we want to strike with the European Union? What do we value more—parliamentary sovereignty and control or market access and trade?
Four months on and there are still no clear answers to those basic, critical questions. All we hear day after day are conflicting, confusing voices. If this continues and Ministers cannot agree among themselves on the future relationship that the Government want, how can this Prime Minister possibly negotiate clear and precise heads of terms for the future relationship with the EU? My fear is that we will get meaningless waffle in a political declaration in October. The implementation period will not be a bridge to a clear destination; it will be a gangplank into thin air. The EU will have the initiative in the second stage of the negotiations and we will find ourselves forced to accept a deal that gives us access to EU markets without UK politicians having a meaningful say over swathes of legislation and regulation.
Some may say that this outcome would not be the end of the world. Some may say that it is inevitable. My point is this: at this pivotal moment in our history, we cannot—and must not—indulge in that very British habit of just muddling through. With under 300 working days left until we leave the European Union, we need to know the Government’s answers to these simple questions. They go to the heart of the matter: the powers of this Parliament and parliamentary sovereignty. The Government must be honest with themselves and the public about the choices we face. Then, the Prime Minister and her Cabinet must make those choices. As has been said, to govern is to choose. As we face the biggest challenge this country has faced since the Second World War, keeping every option open is no longer an option.
Lord Falconer of Thoroton (Lab)
My Lords, it is an honour to follow the noble Lord, Lord Bridges of Headley. Far from seeming like seven years, it seemed like about six minutes; that was such a good speech. Thank you to the usual channels for making it possible for me to speak in the debate.
I do not think it is for this House to thwart, or seek to thwart, Brexit because we would have preferred a different outcome. There may come a time when opinion manifestly shifts, but now is not the time, this is not the Bill and this House is not the Chamber to make that judgment. Parliament must therefore act to give effect to the referendum. This Bill is necessary in principle to incorporate EU law into our domestic law, as the noble Lord, Lord Bridges, said. It is also necessary to ensure a proper and orderly process is followed in Parliament, to ensure that Parliament agrees the terms of the withdrawal Bill.
The necessity of the Bill is matched only by the disastrous attempt to implement both of those purposes. The Bill provides for no meaningful vote for Parliament on the withdrawal Bill. It gives the Executive unnecessarily wide powers to change our laws in ways that would be regarded as unconstitutional in any other Bill. It leaves the judges to make key decisions that should be made by the legislatures. It uses the Bill as an illegitimate means of amending the devolution settlements. I will say nothing further about the devolution settlement except that I was deeply impressed by the speech of the noble and learned Lord, Lord Hope of Craighead.
In this House, we should be willing to amend the Bill extensively so that the House of Commons may think again. From the speeches we have already heard, there appears to be widespread support on a whole range of issues. The bigger the majorities in this House and the more they are supported by Conservatives, the more likely it is that we will influence the outcome and the more likely it is that post-Brexit Britain will be better. I place particular importance on ensuring that the Bill makes provision for a meaningful vote in Parliament—meaning the Commons. In my book, a meaningful vote means a vote that in effect mandates the Government to take a particular course. There is no point in a vote that can take place only at the end of the process; the consequence of the Commons voting down the deal that the negotiators come back with is that we then have no deal, which is almost the worst outcome we could have. It must be made clear that before any deal is finalised, the Commons should get the opportunity to mandate the direction of the negotiations. By that, I mean that if the Executive wants a Canada-style deal but the Commons wants a Norway-type deal, it must be clear that the Commons view should prevail, not that of the Executive.
With every day that goes by, that becomes a more important consideration in the way the process goes. We have a Prime Minister who is home alone in No. 10, without any allies at all—as far as we can see—not willing to tell anybody what our negotiating stance is. When asked by Chancellor Merkel of Germany what the UK’s position was on the trade negotiations, she replied, “Make me an offer”. I can understand why she would not want to tell anybody what her precise bottom line was, but I would have thought that a point would be reached at some stage where she has to tell the counterparty what she actually wants from them. So we have a Prime Minister who is not able to lead and a Cabinet, some of whom appear to think they are in the film “La La Land”, engaged heavily in either cherry picking or having their cake and eating it, while the others appear to think they are—and it is good to see the noble Lord, Lord Dobbs, in his place—in “House of Cards”, where their only concern is how to manoeuvre in a forthcoming leadership arrangement.
Leadership must come from somewhere, and the only place it can come from is the Commons. If the Government know that they must get the approval of the Commons to any deal or basic framework that is introduced, it will focus their mind and make it clear that they will go to the EU only with a proposal that will get through the Commons. It will also give this country a stance that has credibility in the eyes of the 27. More and more, when you speak to people in the 27 who are engaged in the process, they say, “What is the point of dealing with a Government who have no life left in them?”. If they see that the deal definitely has to be agreed by the Commons, they will think that there is some focus of power that gives political credibility to the deal. It is very important that we look at that point. Clause 9 is the relevant provision in the Bill and it does not provide for a meaningful vote.
I mention only one other point in these short remarks. Everyone agrees that these Henry VIII powers are excessive, unnecessary and unconstitutional. I have heard many suggestions about what we should do and I support many of them, but there are two key points. First, the Bill must be amended in relation to all the Henry VIII powers so that they can be used—we need some of them—only where “necessary to make EU law work in the context of domestic law” and, secondly, where they have “only a technical effect”. Anything wider goes beyond our constitution because it requires the Executive to make significant policy choices through secondary legislation. The corollary of that not being the approach of this Government is that I have no doubt that this House would be much more willing than previously to reject secondary legislation under this Bill to ensure that there is proper use of primary legislation. If the Government choose to change the constitution, so can this House.
Lord Steel of Aikwood (LD)
My Lords, I apologise that I missed the later speeches this morning because I was attending an event at which our old friend Shirley Williams was receiving an award. I found myself sitting next to Baroness Trumpington, who greatly misses the House. She assured me that, had she been here in this debate, she would have been giving this Bill hell, and I can well believe that. She encouraged me and reminded me that, in her post-Bletchley years, she spent her life trying to piece together the bits of Europe, like Lord Carrington who was quoted earlier in this debate.
Last week, we had a debate on devolution and Europe, and the noble Lord, Lord Lang of Monkton, made a shrewd point when he said that it was a bit like having a Committee stage debate before we had the Bill. I plead guilty to doing the same again today, because I want to concentrate on one issue only: the effect that the Bill has on the Scottish Parliament.
The Scottish Government were promised an amendment to the Bill in the House of Commons. That never happened. The excuse was given that Damian Green had left the Government, so there was a bit of chaos. Chaos is almost the middle name of this Bill. It was not a very good excuse. I believe that the Scottish Government have been treated rather badly throughout this whole process. In the beginning, the Joint Ministerial Committee set up a European sub-committee, which was to meet monthly and to oversee the negotiations. In fact, it met monthly until February last year, when it suddenly stopped and did not meet again until October. Again, an excuse was brought forward—that there was an election. Come on, was it an election taking eight months? That was another excuse that did not wash. My noble and learned friend Lord Wallace of Tankerness pointed out to the House that the principle of the Scotland Act of 1998 is that everything is devolved to the Scottish Parliament unless it is specifically reserved by statute in the schedules to that Act. This Bill cuts across that principle, in my view.
There is a serious problem, particularly with Clause 11. This is not just the view of the SNP in Scotland; it is the view of the Scottish Parliament as a whole. Its constitution committee said that Clause 11 of the Bill is,
“incompatible with the devolution settlement in Scotland”.
Now, the devolution settlement has worked extremely well, as the noble and learned Lord, Lord Hope, was arguing. We were debating that way back in 1997-98, when I came into the House, and very good debates they were. I think that Bill has turned out to be very satisfactory, but the genius at the heart of the devolution settlement, which was endorsed by the Scottish referendum and encapsulated in that Act, was that it gave a stable and sensible form of government. The trouble with Clause 11 is that it sweeps up the entirety of EU law and puts it beyond the powers of the devolved legislatures, and I think that is not really acceptable.
My noble friend pointed out that, when the Canadian Government were involved in the trade agreement across the Americas, they made sure that the provincial legislatures were in on the negotiations. Of course, they have a proper federal constitution and we do not, but that is still the principle that should have been adopted here. In the debate on Thursday, the noble Lord, Lord Kerr of Kinlochard, lamented that the SNP has no representation here in the House. It is now unacceptable, when the SNP forms the Government in Scotland, that they do not have anyone here in the revising chamber. That is largely their own fault, but the noble Lord, Lord Kerr, said, and I agree, that if the Burns committee report proceeds and the Government agree to the principle that future peerages are of 15 years, at that point the Scottish Government should reconsider their position and bring their voices to this Chamber. In the meantime, it is up to the rest of us to voice their concern, which is that of the Parliament as a whole and not just the SNP. The Conservative Members of the Scottish Parliament in particular fully support their constitution committee. It was a unanimous report that I quoted from a moment ago.
Earlier, the noble and learned Lord, Lord Hope, spoke much more eloquently on this subject than I do. He is quite a remarkable man, because he gets away with saying things that the rest of us would not be allowed to say. He has that air of judicial authority and scholarship. When he says that King Henry VIII did not go to Scotland and Oliver Cromwell did, it is a devastating reflection on the state of this Bill. It is not the Henry VIII powers that matter; it is the fact that Oliver Cromwell dispensed with Parliament altogether. What this Bill does is to dispense with the Scottish Parliament. That is why it is unacceptable, and that is why we must have an amendment during Committee that puts right a totally unsatisfactory Bill as it stands.
Lord Krebs (CB)
My Lords, I had been intending to talk exclusively about the impact of this Bill on the environment and climate change, but earlier the right reverend Prelate the Bishop of Leeds reminded us that the process that this Bill supports is about a broader matter than translating legislation and instrumental processes. It is about what kind of country we want this to be and what kind of Europe we want to see in the future.
I hope noble Lords will indulge me for a moment if I recount a piece of my family history. My father was a refugee from Nazi Germany, who came here in 1933 and was lucky he survived—many of his relatives did not. One individual in the family who survived, remarkably, was his sister, who survived throughout the war in Germany and still lives there. I went to see her just before Christmas and we had a conversation about Brexit. I asked, “What do you think of what our Government are doing?”. She looked at me and said, “In March 1945, my mother and I hid in the cellar of our home because there was an allied bombing raid. We came up in the morning, our house had disappeared completely, the street had vanished completely, the centre of our city had vanished completely”. She went on to describe how, in the subsequent weeks, she and her mother tried to move across Germany with no transport—no railways, no roads, no petrol, nothing. Even to get a bar of soap, she had to sell the carcass of her pet dog. She said to me, “Any Government who want to begin to take apart the structure that we put in place to prevent this happening again must be mad”.
I shall switch now from a broader issue to the rather narrow issue of environmental legislation. We are told that the Bill is about continuity. It is to enable things to operate as they did before on the day after Brexit. As noble Lords will be aware, almost all the legislation that protects our environment, including air quality, marine and freshwater quality, protection of species and habitats, waste disposal, noise pollution and soil quality, comes from the European Union. Defra estimates that there are more than 1,100 pieces of EU legislation within its ambit. At the moment, the enforcement of environmental law is overseen at European level and it is acknowledged, including by the Government, that after Brexit there will be a governance gap.
Take our beaches as an example. Under the bathing water directive, the UK originally designated fewer areas as bathing waters clean enough to bathe in than did Luxembourg. Even Blackpool beach did not make it on to the UK’s list. As a result of Commission enforcement, the UK has increased the number of bathing waters designated from 27 in 1987 to 362 today. The Institute for Government reports that some 29 of the 63 judgments—that is 46%—handed down by the ECJ on UK infringements since 2003 related to the environment. So enforcement by the European Commission and the ECJ has been crucial to our transition from the dirty man of Europe to the place that we are today.
The Government, as I say, have recognised this governance gap and are consulting on the nature of a new body to ensure that environmental standards are maintained and enforced after Brexit. Yesterday, we had a very good debate in this House in which the Minister the noble Lord, Lord Gardiner of Kimble, said that this would be a statutory body, which I think we all very much welcomed. I hope that that will be confirmed by the Minister at the end of this debate. The crucial thing for this Bill is that the new statutory body will be in place, ready to take action, immediately after Brexit. We do not want to say that it is six months or a year until it comes into place; it has to be there on the day we leave.
Other concerns need to be explored in Committee, and I do not intend to elaborate on those now. The noble Baroness, Lady Jones of Moulsecoomb, said earlier that it is not clear in the current drafting that all EU law will be fully transposed. Clause 2 saves transposed directives; Clause 3 converts regulations; and Clause 4 saves other rights and obligations if they have been recognised by case law. We need some explanation of what the implications of that are. As the noble Baroness, Lady Jones of Moulsecoomb, said, the principles of environmental law such as sustainable development, the precautionary principle and the polluter pays principle may be lost, as these are currently in the preambles; they should be retained. If they are not, future decision-making by public bodies or by government may result in weaker protection of the environment.
In closing, I turn to energy and climate change. We have our own national legislation on climate change, the Climate Change Act 2008; nevertheless, some of our energy security and decarbonisation depend on our relationship with the rest of Europe, the EU Emissions Trading Scheme and the internal energy market. As far as I can see, these are not covered by the withdrawal Bill. In fact, in the Select Committee that I sit on—excellently chaired by the noble Lord, Lord Teverson—the Energy Minister told us recently that, although we were going to leave the internal energy market,
“our top priority is to be as near as possible to the current arrangements”.
That makes you wonder whether the simplest way to achieve this is not to leave in the first place.
Lord Willoughby de Broke (UKIP)
My Lords, it is a pleasure to follow the noble Lord, Lord Krebs. I do not, of course, agree with his conclusions.
I welcome this Bill as an important step towards leaving the EU in 14 months’ time—no more than that. It cannot be an attempt to thwart the result of the referendum. I remind some noble Lords that the British people voted to leave in a referendum with a turnout of more than 70%. They knew what they were voting for. In spite of the warnings in the propaganda leaflet sent to them by the Government a couple of months before the referendum, they still voted to leave.
The British people voted to leave in spite of the dire warnings—the warnings of disaster—wheeled out by the then Prime Minister, David Cameron; the then Chancellor; the then President of the United States, “back of the queue” Obama; the fragrant Christine Lagarde, president of the International Monetary Fund; and the Governor of the Bank of England. We were warned of the disasters that would befall us if we were rash enough to vote to leave: a stock market crash, plummeting inward investment and soaring unemployment. It turned out that those forecasts were about as accurate as a cross-eyed javelin thrower. Unemployment is at a record low. The stock market is at a record high. Industry has the fullest order books for 30 years. Inward investment remains very high, as it was before the vote.
With the gloomsters so comprehensively defeated, why do our negotiators in Brussels persist in the pre-emptive cringe approach? I do not understand it. We have a strong hand to play, but we are playing it very badly. Why are we agreeing, for example, to pay the EU any money at all to access the single market? No other country does this—not Switzerland, India or America. Why are we doing it? We are in a very strong position. We have a trade deficit with all the other major economies in the EU. Perhaps we should be charging them for access to our markets. I do not see why we should not do that, on the same basis as they are trying to charge us for access to their markets.
For example, we had a trade deficit of £26 billion with Germany in 2016 alone. Surely, this sort of deficit, which they have with us, gives us some leverage in the current negotiations. I can, however, see no sign at all of that being used, and I wonder whether we should listen to our closest ally, America, in the form of Donald “front of the line” Trump. He said, in an interview in Davos, that he would not have negotiated the way we are negotiating: he would have been much tougher. I really wish that our negotiators would listen to that and drop the pre-emptive cringe.
The referendum has happened. The decision was to leave. We decided that we did not wish to be part of a supranational regime run by a European Commission priesthood that we did not elect and cannot get rid of. We did not wish our laws to be overseen by a European Court of Justice with an entirely different legal system from ours, and we wished to remain in control of our own borders and our own immigration. Those were the three principal points in the referendum. Parliament’s duty is to implement that choice—the choice made in the referendum—and so is the Government’s. I remind the Conservative Government what happened to the Conservatives after the repeal of the Corn Laws: oblivion.
Viscount Trenchard (Con)
My Lords, surely the single Act of Parliament which created the largest number of delegated powers was the European Communities Act 1972. I am therefore surprised that noble Lords do not welcome the fact that the Bill brings many powers back to this Parliament.
The Prime Minister has rightly recognised the need for an implementation period of about two years. The Government prefer the term “implementation period” but others refer to it as a transition period. What is vital is that we must make serious progress towards agreeing the end state before we agree the interim measures. How can we determine what needs to be agreed for the implementation or transition period without at least knowing the broad outline of the definitive free-trade agreement that we expect to have in force at the completion of that period? Can my noble friend the Minister encourage the Government to be bolder and more confident in talking about their vision for the future of the United Kingdom in resuming its place on the world stage as a strong advocate of free trade, which is an absolute necessity in bringing about greater prosperity and the alleviation of poverty, wherever it exists?
Could we not talk more about our markets? In manufacturing, many German and French companies, and subsidiaries of both British and third-country companies operating on the continent, are concerned that their Governments are not doing enough to encourage the EU to ensure open access to the UK’s markets. Services account for more than 80% of the UK economy. The largest part of this is financial services, centred on the City of London. The City has become the world’s leading financial centre, not because we are in the EU but because of many reasons that will continue to apply after we have left the EU. The EU’s negotiators know this; we should call their bluff. If they insist on introducing impediments to free access for Europe’s companies to our capital markets, their companies and their people will suffer.
As recognised by the European Union Committee in its report published last Friday, the UK and the EU negotiators should favour an end state which allows mutual market access. Fragmentation of London’s financial markets would lead to increased costs and a deterioration of financial stability. The EU seems intent on relocating the euro-clearing activity of central counterparties to the EU. But the United States is content for dollar-clearing activity—and Japan is happy for yen clearing—to take place here. Even China seems to take pride in the increasing volume of renminbi transactions taking place in the world’s most efficient financial marketplace. The EU alone is putting political objectives ahead of economic common sense in seeking to bring about the disintegration of London’s financial markets.
London’s markets do not belong to Europe; they do not even belong to the UK. They belong to the world. We host these markets here on behalf of the world. Our regulators, the FCA, the PRA and the Bank of England, will have a commensurately greater influence in the framing of financial regulation in international bodies such as IOSCO once they are restored to the level of independent national regulators. I believe that London’s future continued success as the world’s leading financial centre depends upon our recovering the freedom to adopt a somewhat less dirigiste style of regulation, which will make our markets more attractive to investors and borrowers located in the faster growing economies of the world.
It is of course necessary, as we are often and properly reminded by the City of London Corporation and the industry representative bodies of the City, to secure early agreement of transitional arrangements to reduce the risk of business unnecessarily and pre-emptively deciding to move people and businesses to Europe.
We also need to agree a bespoke deal delivering mutual market access. We have now a position of complete convergence, so it should not be so difficult, as is often claimed. We should make it clear that we will continue to allow EU financial institutions to operate in London on the basis that they do now, in the expectation that mutual regulatory recognition will continue. As advocated by the Legatum Institute, dual regulatory co-ordination mechanisms will in any event be necessary for our future FTA.
The City of London Corporation rightly points out other areas where continued mutual recognition of standards is clearly important for both the UK and the EU. These areas include legal services and the flow of food and feed products through London’s ports. The City also recognises its need to continue to have access to talent under the terms of the future immigration Bill. It needs the most talented individuals to work not only in financial services but across the sectors, including the creative sector.
Lord Bassam of Brighton (Lab)
My Lords, I start with a confession—actually, two. It is a while since I have done this. Back in 1975, I made a decision to vote against Britain being part of the EEC. That decision was as wrong then as I believe Brexit is wrong now. I never thought I would end up taking part in a national debate 42 years later seeking to preserve much of what we have gained in the intervening years.
We must respect the outcome of the referendum, and our primary task now has to be to limit damage. Labour’s historic role will be to protect jobs and the economy. Others in this debate are better qualified than I am to talk about the long-term impact of leaving the EU on the UK economy, but already there are worrying signs. We should have no truck with the ready complacency of David Cameron, the PM who I believe led us to the worst post-war policy decision—barring perhaps the Suez invasion.
In the face of this, what should we—the unelected House—do with the Bill? It would be wrong to reject or emasculate it. Leaving the EU will happen. The questions are: what are the terms of our leaving and how can we mitigate the damage? We need to be on-side with the national interest, and we in this House should be mindful of our role in protecting the constitution. In truth, the Bill is an alarming, incoherent concoction in need of improvement before we send it back, amended, to the other place. We should be unafraid of that task.
The Constitution Committee has done a great service in providing noble Lords with a route map; it is one that we should follow. Much of the critique is legal and technical, not about policy, but that does not mean it is unimportant. Getting the law and its application right will have a direct impact on how post-Brexit policy is determined. For that reason, what your Lordships’ House does with the Bill is of central importance to the future prosperity of our nation. For example, if we let the Government off the hook on EU-derived rights and the European Charter of Fundamental Rights, protections on consumer law, environmental protection and workplace rights, we will have failed in our duty as a revising Chamber. If we cannot secure a properly balanced means of transposing EU law without recourse to arbitrary Henry VIII powers, we will have weakened the protection of the public and failed in our duty. If we cannot secure a transitional period based on current terms within the single market and customs union, we will harm our economy and the national interest.
Before we get attacked by the likes of Jacob Rees-Mogg or the Brexit Minister, Mr Baker, I ask them to think first and reflect on the proper role of the second Chamber. It is our patriotic duty to send large parts of the Bill back for reconsideration. Labour has rightly set out its red lines, and they are likely to be shared across the House. They will include: a meaningful vote at the end of negotiations; ensuring a role for Parliament in the event of no deal; a time-limited transition period on current terms; enhanced protection for EU-derived rights and protections; limiting the scope of Henry VIII powers; and the removal of the Government’s exit-day clause to give our negotiators flexibility. There will be other amendments on other issues. A mechanism for consideration of SIs recommends itself and comes from the Constitution Committee’s report. In that regard, I hope the noble Baroness the Leader of the House goes further than her tentative proposals this morning.
Securing the balance between the devolved Administrations’ powers and responsibilities and the duties for the UK Government as a whole will be a major test, as will be ensuring that the EU border with Northern Ireland is frictionless while it protects the rest of our economy. These are not trifling issues; they are matters our Government have not handled well. We should remind ourselves just how close they came to falling at the first hurdle over the border issue. Being in hock to a small party is never a wise course.
Turning again to the recommendations in the Constitution Committee’s report, my untutored eye concluded that at least 13 are a basis for amendments. One in particular commends itself: that which proposes that all retained direct EU law should have the status of domestic primary legislation. This would secure legal continuity and certainty post Brexit, as my noble friend Lady Taylor explained this morning.
I have three final three points. Though not a policy issue in this Bill, I and other noble Lords will want a coherent explanation of how frictionless trade can be achieved without membership of the customs union or a single market. Without it, our economy will be damaged, as reports from the Brexit department yesterday finally admitted. I also hope to probe and push the issue of refugees during the course of this Bill. The EU may not have covered itself in glory on this, but it has had a strategy, and without one I fear for the future and safety of young unaccompanied children. In 2016, 30,000 of them arrived in Europe. Without effective access to an asylum system or legal routes of transfer, such as Dubs and Dublin III, they will continue to be alone and unprotected. We need a humanitarian structure that protects these most vulnerable citizens. The Government should set out exactly how, in a post-Brexit world, this will work. To date, they have singularly failed to do so, to their shame, and our reputation as a compassionate nation has been damaged.
I am no fan of referendums. In my view you should use them sparingly. I take the view that if you do not know the answer to the question, you do not ask the question. That was Cameron’s historic blunder. The Motion moved by my noble friend Lord Adonis invites us to support one on the final deal. Like our Front Bench, I am not minded to support the Motion, and I suspect others will similarly resist the temptation but, like others, I think it unwise to rule one out.
The Bill, as many have observed, is mostly about process, not policy, and thus something of a Brexit sideshow, but it is important. The Constitution Committee says that it is fundamentally flawed in multiple ways. It can be improved and become a vehicle to restate common values which the EU at its best has achieved. This is how I believe we as a House should approach the Bill. In the absence of a Government with a strategy even for their own legislation, it is up to Parliament to provide clarity and a sense of purpose, and to bring some cohesion to what is before it. That is our historic task.
Lord Taverne (LD)
My Lords, not for the first time I shall express a minority viewpoint. I believe that there will be no deal. The excellent report by the EU Select Committee Brexit: Deal or no Deal pointed out the devastating consequences of no deal but did not address its likelihood—and if it is even a possibility this Bill requires major amendment.
Why is no deal likely? The Government envisage three stages of Brexit. Stage 1 is agreeing a framework for a new relationship with the 27 before the Article 50 leaving date. Stage 2 is, as part of a transition agreement lasting two years, a standstill period during which we negotiate the details of the new relationship and meanwhile preserve the status quo. Stage 3 is an implementation period to allow business to adapt to the new relationship.
At the moment, the Cabinet and the Tory party are hopelessly divided about the nature of the new relationship they seek—and if they fail to agree there will just be no deal. They are also divided about the meaning of the status quo. If it means staying in the customs union and the single market and accepting the obligations of both, it means paying our dues and accepting the jurisdiction of the European Court of Justice and any regulations and directives made by the EU. As two unlikely allies have pointed out, Britain would become a vassal state. The noble Lord, Lord Kerr, was the first to coin the phrase, which has now been echoed by Jacob Rees-Mogg.
But the alternative touted for a soft Brexit of a new kind of customs union with a frictionless border is not regarded as credible by anyone outside Britain, while access to the single market without its obligations—a kind of bespoke new single market—will be unacceptable to the EU. Mrs Merkel and many others have often pointed this out, but the Government have not heard them.
Moreover, since the Government have ruled out even temporary membership of the customs union, the problem of a hard Irish border, fudged last December, remains insoluble. Since the 26 have promised full support for Ireland, this issue alone will mean no agreement—and no agreement with the EU on the framework means no deal. Furthermore, the transition agreement with the EU will be far more complicated than the Government envisage. A period of two years is unlikely to prove long enough—and, again, if it is not agreed before the leaving date there will be no deal.
The crucial question, if there is no deal, is when the meaningful vote by Parliament will take place and what the choice on offer will be. As for when, it must be before October—before we leave—as it must allow time for approval by the European Parliaments. The choice cannot be what the Government seem to envisage: either accepting or rejecting no deal. Accepting means leaving; rejecting cannot mean telling the Government to go back and renegotiate. That would be wholly unrealistic. The only real alternative would be either withdrawing Article 50 or holding a new referendum, when it would this time be clear what Brexit actually means. As the noble Lord, Lord Butler, observed earlier, we will need an amendment to the Bill to ensure that the choice of a new referendum is part of a meaningful vote by Parliament.
Lord Kakkar (CB)
My Lords, I thank the Leader of the House for the thoughtful way in which she introduced the debate and the noble Baroness, Lady Smith of Basildon, and the noble Lord, Lord Newby, for having achieved an important degree of consensus on some important principles. They are that it is of course absolutely essential, and the duty of the your Lordships’ House, to scrutinise very thoroughly the legislation before us, which will have an ongoing and fundamental impact on the rights and lives of our fellow citizens for many generations to come, but at the same time that your Lordships’ House should not, and probably will not, use the Bill to in any way undermine the authority and primacy of the House of Commons. We have the right of course to revise and to ask the other place to think again, both about issues that it has already considered and about the many issues in the Bill that it has not properly scrutinised, but it would be completely wrong ultimately to frustrate the will of the other place in any way.
In the context of those simple principles, I will touch on two areas, although there are of course many that will require important scrutiny. The first deals with regulations that are important to our national interest—in this regard, regulations that relate to the question of clinical trials. In so doing, I declare my interests as a professor of surgery at University College London, director of the Thrombosis Research Institute and an active biomedical researcher.
The current clinical trials directive, which has been transposed into domestic legislation, has been much criticised because it is considered to have thwarted and undermined in many ways the ability of our country to perform clinical research at the most efficient level. As a result, quite rightly, new clinical trials regulation has been considered and developed. Our own research community made substantial contributions to the development of that regulation, and it is a much better piece of legislation. That is recognised to be a good thing. It was due to be adopted across the European Union in October 2018, but there has been a delay to its adoption and it will now not be applied until later, in 2019.
As a result, the legislation that deals with the conduct of clinical trials, which is vital to delivering healthcare in our country and to our life sciences industry, will be retained legislation with the current directive. As far as I can see, there is no mechanism for a regulation that has been agreed but not yet applied across the European Union on the day of exit to be dealt with under the Bill.
I therefore ask Her Majesty’s Government how they will deal with that question, which is of considerable importance. There may be other areas where we, in our national interest, have agreed or will in the coming months agree regulations that will not be applied by the Union by the time of our exit from the European Union. As far as I can see, the Bill does not deal with that.
Clause 6(2) deals with the regard that courts and tribunals should give to the development of European law which, at the time of exit, has become retained European law but which is further developed thereafter by the European Court of Justice. Here I declare my interest as chairman of the Judicial Appointments Commission. The Bill proposes that the courts and tribunals do not have to take account of the further development of law beyond the time of exit, but they may do so if they think it appropriate. That seems a confusing and dangerous proposition.
Inevitably, and quite rightly, the European Court of Justice will continue to develop its law with the interests of the European Union, both political and economic, firmly in mind. Those issues may be quite different to our national interest, but the Bill proposes to leave the judiciary to make the decision about whether they should pay attention to this matter and what weight they should give to it—that is, the development of law beyond the time of exit from the European Union. As your Lordships’ Constitution Committee identified, that risks drawing the judiciary into areas of political controversy. Parliament has rightly taken the view that there should be a separation of powers, that Parliament is sovereign, that Parliament is responsible for matters of political policy and for the establishment of statute and that it is for the courts thereafter to interpret the law and apply it.
It therefore seems wholly counterintuitive for this Parliament to take the judiciary—an important part of our constitution—to a place where it may be drawn into political controversy, as a result of which there may be a loss of confidence in our independent judiciary and a loss of morale. That would be a terrible consequence of departure from the European Union and, as the Constitution Committee rightly identified, it is a matter that needs to be carefully scrutinised. The committee identified a potential solution—there may be others—but clearly it is a matter that your Lordships’ House will need to consider in detail and potentially ask the other place to consider once again its position on this matter.
Lord Lang of Monkton (Con)
My Lords, like the noble and learned Lord, Lord Falconer, I am grateful for the opportunity to speak in this debate after an apparent mishap or two with the speakers list.
I have two general points to make. The first is about the nature of the Bill. I agree with the noble Baroness the Leader of the Opposition who, at the start of the debate, made the point that the Bill is poorly named, which is perhaps why it has attracted measures of criticism and mischief elsewhere for what is largely a technical Bill which does not deserve that kind of treatment. I would have called it the “Transposition and Rehabilitation of Legislation Bill”—that might be suitably dull and boring to head off some of the worst troublemakers. It is a technical Bill, and I suggest that it would be quite wrong for this House to treat it either as a proxy for the battle over our departure terms from the EU or even for whether we should depart at all.
Departure from the European Union was given effect by the invoking of Article 50 last March, approved by Parliament. That followed a referendum, also approved by Parliament; and afterwards, all parties undertook to support the result. Much is read into what the electorate might have meant by their vote, but the question they were asked was not, “Shall we leave if we cannot get a good deal?”, or, “Shall we remain unless we can stay in the single market?”. The question was simple and unqualified: “Leave or remain?”. And the electorate chose to leave.
Despite an aversion to many aspects of the European Union, I had voted remain on economic grounds. But once the electorate delivered the verdict that we, in our wisdom, had devolved to them, I took the view that I am glad to hear reflected elsewhere in the House today—that we must accept it and implement it, with the best deal we can achieve. In that context, I particularly welcome what my noble friend Lord Bridges of Headley said—that the negotiations need to be got a grip of, and a clear way forward mapped out, as soon as possible.
This Bill—complex in nature, constitutionally important and administratively essential—is a consequence of the referendum decision. I support it, not as the trigger for our departure, nor to affect future relationships with Europe, but simply to sort out the legislative consequences of departing, to protect the rule of law in this country, and to seek legal certainty and continuity from the moment we leave the European Union by bringing home all the legislative measures that have accumulated there over 46 years. Without it, there would be chaos.
My second point concerns the drafting of the Bill and its implications for the balance of power between Parliament and the Executive. The Constitution Committee has—uniquely, I believe—produced no fewer than three reports on the Bill. The first—over a year ago, when I had the honour to chair the committee—was produced before the Bill had even been published, such was our concern about what its terms might be. The latter two were under the admirable chairmanship of my successor, the noble Baroness, Lady Taylor of Bolton. The latest report, published yesterday, has been forced to conclude that the Bill is “fundamentally flawed” in multiple ways. If that is so, we are clearly right to be concerned, and to remain so.
Now is not the time for detail, but we recognised at the outset that—unavoidably, given the scope, scale and complexity of the task—the Government would need additional delegated powers over secondary legislation. We also listed a broad range of protective constraints that would be vital to balance these. Some have been secured, but the noble Baroness, Lady Taylor, has listed an impressive list of what still needs to be done. I continue to support her approach and that of her committee on this important matter.
On the devolution issues, some of which were debated in the House last week, I hope the Government will listen very closely to what the noble and learned Lord, Lord Hope of Craighead, said. His analysis, surely, cannot be bettered. Essential though it is that the Bill passes into law, I conclude that, should it be used also as a means for the Executive to gain permanent new legislative powers at the expense of Parliament, that would be a dire price to pay, in the long run, for the sake of restoring what one may soon be able fondly to refer to once more as “the law of the land”.
Baroness Massey of Darwen (Lab)
My Lords, I shall today discuss some of the implications of Brexit on children and families. I define children as being up to the age of 18, based on a number of agreed conventions. Laws relating to families and children are a vital part of our justice system. They vary in the devolved nations but form a structure which has been important in protecting children and resolving family disputes.
A paper by the law firm Resolution, prepared with the Family Law Bar Association, points out that there are approximately 140,000 international divorces and 1,800 cases of child abduction in the EU each year. Their opinion is that the European Union (Withdrawal) Bill could create problems for tens of thousands of people. We must place a requirement on the Government to report to Parliament on how the rights afforded by EU family law will continue to exist in UK family law and how progress is being made. Clause 6 must be amended to retain the ability to refer to the CJEU in family law on the basis of reciprocity.
I looked recently at the debate on the EU Committee report Brexit: Justice for Families, Individuals and Businesses?, which was held in December last year. The committee was chaired by my noble friend Lady Kennedy of The Shaws, who spoke of the civil justice co-operation between European states. As she said, it works, yet we seem to know little about the Government’s thinking on such complex matters.
The noble Baroness, Lady Shackleton, from the Conservative Benches, spoke of,
“a recipe for confusion, expense and uncertainty, particularly in family law”,
stating that,
“the UK’s family law system post Brexit is, to put it mildly, disappointing”.—[Official Report, 20/12/17; cols. 2122-23.]
The noble Baroness, a respected practitioner in this field, gave telling examples of such confusion. I am horrified to think that disputes over the custody of children, residence rights and safeguarding issues are likely to become more complex after Brexit. Children deserve better. They often find themselves innocent victims of situations they have not created.
Coalitions of those concerned for children’s rights in the UK are putting forward challenging demands for clear and consistent explanations of what the scenario will look like after Brexit. I am grateful to them for their advice and support. Measures in Wales, Scotland and Northern Ireland may well be affected, as much of EU law affecting children is likely to be repealed or amended through the use of delegated powers. A recent report by a law firm for the Children’s Rights Alliance and the Children’s Law Centre in Northern Ireland analyses clinically the whole scenario, including education and the Good Friday agreement. It makes uncomfortable reading.
Our domestic laws, embedded in the Children Acts 1989 and 2004 and the not yet in force Children and Social Work Act 2017 are, of course, welcome, but they do not cover the full range of children’s entitlements in EU law. The EU Charter of Fundamental Rights, the EU Convention on Human Rights, and the UN Convention on the Rights of the Child, ratified by the UK, focus on adherence to standards for children’s rights. The Minister may say that these rights will be protected, but where will be the statutory provision requiring respect for children’s rights in lawmaking? We should expect from Ministers a commitment to have due regard to the UN Convention on the Rights of the Child, and this should be incorporated in law.
The Children’s Rights Alliance makes a powerful argument for retaining the Charter of Fundamental Rights, due to be removed in Clause 5 of the Bill. Some charter rights—for example, those relating to children—have no equivalent protection in UK law. The noble Baroness, Lady Evans, referred to the charter in her opening speech this morning and pointed to the Government’s right-by-right analysis to justify their position. What she did not refer to was the Joint Committee on Human Rights’ scrutiny which, in six paragraphs, refers to uncertainty that is likely to undermine rights, including children’s rights under the UNCRC.
In short, laws to protect children and deliver transparent justice for families must be preserved. It concerns me that I see too little emphasis from the Government on that aspect of Brexit. I hope that legislation for children and families will feature in our future deliberations.
Lord Tugendhat (Con)
My Lords, I agree with those who say that this Bill is not about whether we should leave the EU or stay in it—it is about how to ensure against a legal void when we leave. On that basis, it is a Bill that must, of course, pass. The question is in what form it should leave this House and return to the Commons. As has been widely pointed out, it represents an unprecedented arrogation of power to the Executive. Our duty, therefore, is to do as much as we can to ensure that the arrangements in place will be those that ensure that the powers are exercised in a responsible and democratic fashion, in accordance with parliamentary sovereignty and the rights of the devolved Administrations. It will be for the House of Commons to take the final decisions, but we must do what we can to lay before it a Bill that meets those criteria.
This means that the Bill requires substantial revision. I hope very much that the Government will take into account the serious concerns raised by the Constitution Committee and others with parliamentary and constitutional experience. I was encouraged by what my noble friend the Leader of the House had to say on that subject. I hope very much that noble Lords on the other Front Bench will pay very serious attention to what is said and not resort to any accusations of sabotage or anything of that nature. For my part, I hope that I will in general support Ministers. However, I will feel able to do so only if I am convinced by the merits of the case they put forward and that they have taken into account the arguments others have made, even if they have not accepted them.
I hope that the Government will understand another concern that I have. Our debates take place against a background of not only negotiations in Brussels but a struggle between different factions in the Cabinet and within the Conservative Party. Indeed, it is very hard to know at times what official policy is, let alone in what direction it is heading. This uncertainty is bound to influence the way in which—I was going to say “one” but I should say “I”—I respond to ministerial arguments on the Bill and to the way in which Ministers deal with amendments that are put forward. That is true of not just those clauses and amendments relating to our domestic law; it is even more true of those relating to our future relationship with the European Union. On that question I would like to make two points in the limited time available.
First, we must aim to strike a balance between the least possible economic and trading disruption in the short term and scope for regulatory divergence in the long term. That sentence is easy to say but the objective is extremely difficult to reach. As time progresses, the EU will develop differently from how it would have done if we were still members. We need to ensure that while remaining closely aligned to it, we are able to adopt policies that reflect our own views and priorities.
My second point is directed at those to whom the role and scope of the European Court of Justice and European law has become neuralgic. I ask them to consider the extent to which the United States listing requirements and sanctions regulations impinge on the freedom of action and practices of British companies and citizens. We live in a world in which a middle-sized economic power is inevitably constrained by the extraterritorial reach of the larger powers. If we are to prosper and have a successful trading and commercial relationship with the rest of the world, we are going to have to accept that reality. We will certainly have to accept it in any deal we might do with the United States. We need to accept it in relation to the European Union and in due course we will find that we have to accept it in relation to China.
I end on a point which others have made: if we are to secure a good deal—or, indeed, any deal—in Brussels, the Cabinet must end its internecine warfare and Cabinet Ministers must curb their personal ambitions. They must rally behind the Prime Minister and get stuck into the job in hand.
Baroness Goudie (Lab)
My Lords, the Bill seeks to make provision in connection with the withdrawal from the EU of the three nations, England, Wales and Scotland, and part of the island of Ireland, if that can somehow be done without having a hard border across that island between the UK and the EU. The Bill is a stab in the dark. None of the terms of withdrawal is yet known. All we can sensibly do at this stage is to make provision for how decisions will be made and by whom, and when the terms are known their acceptability or otherwise must be judged. Will it be by Ministers, without accountability? Will it be by Parliament, by way of a No. 2 Bill? Will it be by a referendum? Or will it be some combination of the foregoing?
The fact is that the whole Brexit process is a mess. It needs straightening out. There is no case for a second referendum, if by that is meant a return to the referendum we have already had. There is every case, if one is ever going to have referendums at all, for another referendum, at the appropriate time, in the circumstances then prevailing, on an altogether different question: namely, what to do once the terms are known. The past referendum is spent. Voters have died, and others have come of age.
There were four options the day after the previous referendum. The Government adopted none of them. Total confusion reigned, it has reigned since and it reigns today. One option was to accept that it was not a binding referendum, that between the constituent parts of the UK the result was a tie, that overall the result was close, and that Parliament should decide, doing no less and no more than taking due account of the referendum outcome.
The second option was to interpret the outcome of the referendum and the closeness of the result as meaning not, at one end of the spectrum, remain, nor, at the other end of the spectrum, a hard Brexit, but down the middle a soft Brexit, behind which there might develop some degree of accommodation, rather than heightening the polarisation. But neither the referendum itself nor the Government’s reaction to it provided any clarity as to what Brexit was supposed to mean.
Thirdly, Brexit could have meant Brexit. That, presumably, is what Brexiteers thought that they were voting for. However, they have been betrayed ever since the morning after the referendum. By “Brexit” they no doubt meant taking back control, informing the EU, as of then, that we were out of the EU. Of course, there would be matters, financial and otherwise, to be sorted out after departure, but there would be no delay at all in departure itself and taking back so-called control forthwith.
The fourth option was a watered-down version of the third. On the day after the referendum, or, if you prefer, the following Monday, two years’ notice of withdrawal would be given. However, even that was not done. First one Prime Minister, then another, dithered, and then there was talk about whether even two years from a delayed starting point would produce finality.
So confusion piled upon confusion from the word go, and it continues. The Government cannot be entrusted with the process either of determining whether Brexit should go ahead on the final terms or, if it is ultimately to be implemented in one way or another, of how that is to be done. There must be democratic accountability, above all at the crucial stage yet to come. The present Bill is only half a Bill. It professes to repeal the 1972 Act but seeks to do so before knowing more than half the picture.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, as has been said, this is an extremely complex and legalistic Bill. While I may be able to cope with the complex, the legal ramifications are beyond me and are much better left to those who have had the necessary training and experience. Nevertheless, the Bill and all that it stands for will have huge implications for people in what was the United Kingdom. Many are extremely frustrated at how long it is taking to extricate the country from what they see as the “clutches of Europe”. Others are extremely apprehensive about what their future will be in a stand-alone island.
Today’s debate is important, as it sets the tone for the debate to take place during Committee and Report, when those here today will drill down into the detail. The Bill seeks, as the Leader of the House so eloquently set out, to ensure that our laws under the EU are transposed into UK law at the point in March 2019 when the country no longer has EU membership; it seeks, that is, to align UK law with that which pertains before March 2019. There is a great deal of disquiet about exactly what this will mean and how it will affect businesses in the agri-food sector.
Agriculture in 2015, was 1.4% of the GVA in England, 2.7% in the south-west and Scotland, and 4.8% in Wales. But—and it is a big but—it represented 70% of the land use across the UK. Food growth feeds into food production. Food supply is one of the 13 critical national infrastructure sectors. In 2015, the food chain relied on imports of £40.3 billion, of which £28.4 billion came from the EU. In terms of food manufacture, 25% of employees were born outside the UK.
The current subsectors of land use are: agritech, which is very important for new and innovative ways of both growing and harvesting crops; plant breeding, another area where investment brings huge returns; and forestry. According to the 2014 VAT statistics—goodness know why there are not more up-to-date statistics—there are 3,685 forestry businesses, 555 sawmills, 130 wood-based panel businesses and 230 pulp and paper businesses. Of the private owners, 90% have holdings of less than 10 hectares. This equates to 30% of privately owned forests. Yesterday’s debate on the 25-year environment plan showed that forests are essential to the quality of the air we breathe. We must preserve these businesses after the exit from the EU.
Post Brexit, what will happen to the National Office of Animal Health—aptly named NOAH? Veterinary medicines are essential. As with food production and safety, the UK needs access to developments in animal welfare and medical advances in order to ensure healthy crops and livestock. Currently, EU rules protect livestock from foot and mouth, blue tongue, avian flu and the Asian longhorn beetle. These diseases have a damaging and long-lasting effect on farmers. EU rules ensure there is immediate cessation of trade from infected areas, and swift resumption once appropriate controls are in place. Farmers and growers will wish to have the security of such controls post Brexit.
Although agriculture is vital, many will point out that food manufacturing, wholesaling, retailing and non-residential catering produce 10 times the GVA. However, without a sustainable, vibrant agricultural base, will food manufacturers increasingly have to import from all over the world? Our fishermen currently land cod in UK ports, where it is sent to China for filleting; China then sends it back to the UK for breading. What total nonsense is this? No doubt it is then served up in the restaurants in and around the House.
We live on an island with brilliant coastlines and countryside. Ireland has a similarly vibrant fishing industry which needs protecting. As we all know, fish are not respecters of borders—how can they be? I look forward to both the agriculture and the fisheries bills coming forward later this year. In the meantime, I have flagged up my concerns about how this Bill will align our laws in reality and how important it is to amend it to make it fit for purpose.
Lord Bilimoria (CB)
My Lords, Professor Sir David Eastwood, the vice-chancellor of the University of Birmingham, where I am proud to be chancellor, wrote an article yesterday, entitled “Trump and Brexit have triggered two deep constitutional crises”. “Two years ago”, he says,
“a Trump presidency and a vote for Brexit were considered all but unthinkable. Now, two of the world’s oldest democracies are struggling to live with them, and their struggles are even more profound than they seem”.
He goes on to say that basically, since the Reformation, Parliament has always been sovereign and until the Brexit vote the broad parameters of the constitution, according to Walter Bagehot in the 1860s, have prevailed. When we have had referenda in the past, on the whole they have reflected the will of Parliament. However, David Cameron decided on this referendum and, for the first time, we had a Prime Minister and a country in turmoil, with Parliament—the vast majority of MPs and Members of this place—wanting to remain before the referendum and then a narrow result. Now, politics is on hold until Brexit is determined. Both parties are beholden to their more extreme wings, according to Professor David Eastwood, and the machinery of government is overheating and struggling to shape the Brexit deal.
Is this going to continue? The Government have put down the red lines of leaving the single market and the customs union. The EU has made the situation very clear. Yesterday, it said, “If you want a transition period, you can have it but you have to adhere to the free movement of people, you have to keep paying money in, and you have to keep having EU regulations and EU law”. So what deal will the Government be able to negotiate on that basis? Today, BuzzFeed News is reporting on the leaked government analysis of Brexit that says that Britain will be worse off in every scenario. That analysis looked at three scenarios: deal, no deal and a soft Brexit. In each case, Britain will be far worse off in every area. It says that the biggest negative is the UK’s decision to leave both the customs union and the single market.
We have had 3 million people from the European Union working here. In phase 1 of the negotiations it was said that they would be protected, but what about the future? They make up less than 5% of this country’s population. They are not a burden on this country. Without them, we would have an acute labour shortage, so we should be grateful to them.
I openly admit that I am a Eurosceptic in many ways. I dislike the European Parliament, I do not know who my MEPs are—I do not think that many of your Lordships do—and there is no accountability or responsibility. I think that the euro was a huge mistake—thank God we did not join it. I made a mistake with Schengen: I thought that we should have been a member, but now thankfully, from a security point of view, we are not. So we will never have a “United States of Europe”.
I have never been one for further European integration. We signed out of that. The EU is nowhere near perfect. It has huge faults but, looking at it on the whole, on balance we have done well out of it. We have had the highest cumulative GDP growth rate of any nation, including Germany—62%—since being a member of the EU. However, the sad thing is that even the OBR in the Budget has just said that, looking ahead, we will have a growth rate of less than 2% a year for five years—the lowest ever level.
We are the highest recipient of inward investment in Europe but, now, the Government and the Brexiteers are talking about going global. What is this “going global” nonsense? Fifty per cent of our trade is with the European Union. Another 20% on top of that is through the free trade agreements we have through the European Union, including, now, with Japan. That leaves 30%. As a businessman, am I going to give up 70% for 30%—and a 30% that I may never get? India and the Commonwealth account for less than 10% of our trade. Canada has a free trade deal with the EU but the EU accounts for only 10% of Canada’s trade. Its biggest trading partner is the United States—next door to it. India has nine free trade deals with countries around the world but not one is a western country. And what about the £8 billion that we have paid into the EU? I would pay that for the peace that we have had over the last few decades, including through NATO. As for sovereignty and taking back control, what a lot of nonsense. The laws that affect us in our day-to-day life are not the 20,000 regulations that the noble Lord, Lord Pearson, spoke about but the ones that we make here in this House every day.
I turn to this European Union (Withdrawal) Bill—or great repeal Bill, or whatever it is called. In the debate that we had last week on devolution, I challenged the Minister to explain how we are going to deal with the Northern Ireland situation. He did not have an answer. Phase 1 has just kicked the can down the road. Scotland will say, “We want to be treated on the same terms”. Can the Minister tell me how we are going to deal with Clause 11, to which the noble and learned Lord, Lord Hope, referred?
By the way, at the time of the referendum UKIP got 12.5% of the vote. Today, the figure is 1.8%, and let us not talk about its leader. What really upsets me is that Brexit has damaged our standing in the world and I see this all the time. I was with the Prime Minister of India earlier this month and I have seen India’s reaction to Brexit. We were flying before the referendum; now, look at Davos, where we were overshadowed by Macron and Trump. The whole world, except for Trump, thinks that we should remain in the EU.
In conclusion, virtually every speech today has made references to “when we leave the European Union” and “after Brexit”. Steve Jobs founded the most successful company the world has ever known—Apple. He said that changing your mind is a sign of intelligence. Keynes said:
“When the facts change, I change my mind. What do you do, sir?”
Even David Davis said:
“If a democracy cannot change its mind, it ceases to be a democracy”.
We have Juncker and Barnier—everyone—saying, “Stay on. We would welcome you staying on”. Even Farage has now spoken about a second referendum. Boris Johnson has said that there is now a danger that Brexit will not take place.
My message is this: we have to go through the motions of this Bill. We have to go through whatever we have to go through, but in a normal democracy you get a chance every five years to change your mind. We are not getting that chance, and in the two years that have already passed since the referendum was called, a lot has changed. We face many challenges: the NHS, our security, our police forces, our Armed Forces, our Army, which would not fill Wembley Stadium, our Navy and our entrepreneurship—fewer companies started last year than the year before. That is what we have to deal with, not this wretched referendum. We need to give the British people the chance to have their say, with all the facts—we can call it a second referendum; we can call it referendum part two—and Parliament must have the final say before any deal is passed on to the European Union. Will the Minister confirm that Parliament will have the final say?
Finally, at the Harvard Business School— of which I am proud to be an alumnus—I talked to Dr Deepak Malhotra, a world expert in negotiations. He has written an excellent paper on Brexit. He told me to read a book about the build-up of the First World War. He said, “Reading that book is like watching a train crash in slow motion. Karan, that is what Brexit is: a train crash in slow motion”. It is not too late to stop that train crash.
Viscount Ridley (Con)
My Lords, this is not the Bill that enables us to leave the European Union. It is the Bill that makes sure the law works when we do. Britain voted decisively in 2016 to leave the EU. Both Houses of Parliament then voted to leave the EU. Both main parties stood in the general election on a manifesto of leaving the EU, while the Liberal Democrats and Scottish nationalists, who stood on the opposite promise, lost votes and seats.
Now, the elected House of Commons has sent us this Bill almost unamended. That does not mean we cannot scrutinise and amend it, but it does mean that trying to wreck it, under the pretence of amending it, is not acceptable. If, in this gilded, crimson echo chamber of remain, this neo-Jacobite hold-out for the euro-king across the water, we indulge in wrecking this Bill, we will not stop Brexit—but we might hurt Britain. The public reaction would rightly be severe. In the part of the world I come from, in Ashington, Blyth and Cramlington, they will say—I paraphrase—“How dare that unelected panoply of panjandrums and pampered popinjays think they know better?”.
I look around this Chamber and, among those with genuine concerns about the Bill—many of whom will have listened attentively to my noble friend the Leader and her careful concessions on the SLSC and affirmative procedure—I also see people pretending to worry about democracy while trying to undermine it and pretending to want the best for the country while talking down Britain. I see people who, unlike David Cameron, refuse to admit that,
“Brexit has turned out less badly than we first thought”.
That is a quote.
Viscount Ridley
That is what David Cameron said. Remember what the Treasury forecast said in the event of a leave vote. These were its exact words:
“A vote to leave would represent an immediate and profound shock to our economy. That shock would push our economy into a recession and lead to an increase in unemployment of around 500,000, GDP would be 3.6% smaller, average real wages would be lower, inflation higher, sterling weaker, house prices would be hit and public borrowing would rise compared with a vote to remain”.
That was not its worst-case scenario. Instead, we have falling unemployment, record employment, strong consumer confidence, robust GDP growth, higher real wages, modest inflation, stable house prices, booming inward investment, thriving tourism, a buoyant stock market and even sterling is back above $1.40—not far off its pre-referendum level, more’s the pity.
That is a clean sweep of failed predictions and the Treasury, in the leaked documents that we have seen today, has barely changed its models.
In August 2016, the Bank of England forecast that exports in 2017 would be down by 0.5%, despite the devaluation of sterling. In fact, they were up 8.3% year on year. Here are a few headlines from just this month alone:
“Exports put UK factories on their best run for 20 years”;
“Freight volumes through the Port of Dover have reached record levels for the fifth consecutive year”;
“UK tech sector enjoys record investment in 2017 despite Brexit”;
“UK services grow faster than forecast despite growing Brexit concern”;
“British universities boast record number of international student admissions”;
and, for the first time ever, the UK has topped the Forbes annual survey of the best countries for business.
To those who say things could have been even better, I reply that I am amazed we have not slowed more. Despite a dire dirge of doom from the diehards that people should put their heads between their legs and kiss their fundaments goodbye, British consumers and producers just keep rolling along. Good for them. The noble Lord, Lord O’Neill, made the sensible point that Brexit is probably not the most important thing happening. “If that’s the worst that Brexit will deliver”, he said, “I wouldn’t worry about it”.
Talk to businessmen and they are more concerned about the fourth industrial revolution, and the opportunities and threats that it brings—artificial intelligence, data processing and gene editing. I have just come from the inaugural meeting of the APPG on Blockchain. We face a thrilling century in a vibrant world. We can face it from behind the protectionist tariff walls and harmonised regulatory veils of the EU—where sluggish legislation is shaped by £1.5 billion of crony capitalist lobbying a year—or we can face it openly, adopting global standards and taking decisions that favour innovation rather than retard it. That does not mean deregulation; it means better regulation. To get there, we need as a simple exercise of democratic action, to pass this Bill, which neither gold-plates nor waters down anything.
To those noble Lords who say that the Government will get too much executive power here or there in the undergrowth of the Bill: I will listen to their arguments. I have some sympathy with them, though I wonder why they often expressed so little concern at the way EU laws were imposed on us in the biggest Henry VIII power grab of all. However, I urge them to listen to what the Government are saying in concession to these points. Some of the accusations of incoherence from this side of the House do, I admit, have force. But it is a bit rich to be lectured on incoherence by the Labour Party.
Lord Foulkes of Cumnock (Lab)
My Lords, I am really glad that I did not have to follow the rousing and excellent speech by the noble Lord, Lord Bilimoria. It would not have been easy. Instead, I have the pleasure of responding to the alliterative rabble-rousing rant of the noble Viscount, Lord Ridley. I must remind him that we are still in the European Union, so all that he started by saying is entirely irrelevant. He and a number of Members, including the noble Lord, Lord Tugendhat, said that the Bill is nothing to do with whether or not we leave. With respect to them, the Bill assumes that we are leaving, so it is relevant. I make no apology for restating what I have said before. I do not accept that in a parliamentary democracy an advisory referendum is binding on Parliament and the Government—or, as the Prime Minister said, an instruction to Government. I thought I was in a minority of one in that view until I heard the magnificent speech of the noble Lord, Lord Higgins. It was terrific, so now there are two of us. There may be more. Any advance on two? Three, four—we are doing well. The numbers are growing.
Those who will be most affected by our exit did not have a vote. The 16 and 17 year-olds, who had a vote in the Scottish referendum, were not allowed a vote in the EU referendum. They would be able to vote now: they are 18. European Union citizens were not allowed to vote yet they pay their taxes and have been for years. What happened to no taxation without representation? They should have had a vote but did not in that flawed referendum that is supposed to be binding on us.
Before I continue on that theme, I want to say a word about Clause 11. I agree with all my Scottish colleagues, from different parties and none, about the need to deal with the concerns of the devolved Administrations in Clause 11. Along with the noble Lord, Lord Wigley, I shall table an amendment that will ensure the approval of the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly by a Motion of legislative consent. It will make it mandatory that this cannot go through until these devolved Parliaments agree.
Returning to the theme, it has been 19 months since the referendum and what has happened? Almost nothing. There have been almost no agreements. How long do we have left? The clock is ticking very fast. There are only 13 months left. We have had confusion, uncertainty and concern. Not just Gibraltar, but other overseas territories have been in touch with me about their concerns. Northern Ireland has this astonishing situation whereby the Democratic Unionists may agree something that could end with a united Ireland, if things go wrong with this whole operation. We have had concern expressed by the arts sector, the media, universities and the City of London. Nurses and doctors have been leaving. A leaked document from the Department for Exiting the European Union says that growth will be 5% lower if we leave—not when we leave—unless we have a bespoke deal. What is a bespoke deal? I do not trust Dr Liam Fox to get us anything as wonderful as a bespoke deal.
As we saw again today, Brexit is dominating our discussions and our Oral Questions. It is dominating what the Government are doing. Justice, the health service and education are not getting the consideration that they deserve. How do we extricate ourselves from a looming disaster, this cliff edge? Last night, I went to the Speaker’s Lecture and heard Kenneth Clarke once again give a brilliant demolition of Brexit, but sadly he stopped short of wanting to scupper it, which was very disappointing. Too many remainers are throwing in the towel. All the people who really understand it say the rush towards Brexit will be disastrous, yet some of them are still rushing towards it. It makes lemmings look cautious by comparison.
There is a mechanism by which we could save ourselves. I believe in parliamentary democracy, and Parliament could do it in that meaningful vote. If it is argued—it is an argument—that we have had one referendum and it can be overruled only by another referendum, I would go along with that. It would not be a second referendum, incidentally; it would be a third. We had one in 1975, with a two-thirds majority in favour of staying in the European Union. I say to the noble Viscount, Lord Ridley: that was a huge majority, not what we had in the last referendum. This would be the first referendum where we knew exactly what was involved and when we could decide on either the deal that the Government agree—if they manage to get one—or the status quo. That status quo would be continued membership of the European Union. There is a real choice and we would understand it. We should not be leaving Europe; we could, and should, be leading in Europe.
Lord Kilclooney (CB)
My Lords, way back in the middle of the last century, I was an active member of the European Youth Campaign. In 1975, I campaigned to keep the United Kingdom in the European Economic Community. I was a Member of the European Parliament for 10 years and, for a considerable number of years following that, was in the Parliamentary Assembly of the Council of Europe in Strasbourg. I was a member of the Christian Democrats, the PPE, in the Strasbourg assembly. I have visited every nation in Europe, including the Vatican. I feel European and British. But the longer I was in Strasbourg, the more I realised that the European Union was becoming a politically integrated union and not the European Economic Community that I had supported. I therefore, after much soul-searching, voted for Brexit.
The legislation is most complicated and gives the Lords the opportunity to present itself to the United Kingdom at its best. Alas, it gives those who wish to abolish the Lords a great opportunity to present the Lords at its worst. I am impressed by the maturity of approach by her Majesty’s Official Opposition.
Brexit has many challenges for those of us who live in the island of Ireland—both those in the United Kingdom and those in the Republic of Ireland. For the Republic, it will probably mean a reduction in agricultural exports to Great Britain, increased payments to the European Union budget and reduced CAP funding for its farmers. In Northern Ireland, we take no pleasure in economic problems in the south, because they would impact on us as well, and we hope that these problems can be overcome.
In Northern Ireland, it is correct that a majority voted against Brexit. It was not only Sinn Fein and the SDLP who voted in that way; the Ulster Unionist Party also campaigned to remain within the European Union. The latter has now decided to accept the referendum result and so it can now be reasonably assumed that it is a minority in Northern Ireland that still wishes to remain within the European Union.
Lord Kilclooney
Yes, that is the correct position.
In trade and business, the vast majority from Northern Ireland goes to Great Britain and only a minority across the border to the Republic, so the suggestion of a new border running down the Irish Sea would be disastrous both for Northern Ireland business and for employment. I note that this proposal has now been abandoned.
In Northern Ireland, I live near the United Kingdom border with the Republic. We welcome the objective of a soft border. We are assured that already Belfast, Dublin, London and Brussels are agreed that the common travel area will continue. Let us hear no more scaremongering, please, about passports at the border. Likewise, we are pleased that the United Kingdom will have no structural posts at the border and would like 80% of trade by small and medium-sized hauliers to be customs free.
Of course, there needs to be a similar response to this on the other side of the border. Dublin, now controlled by Brussels, has still not made known to us its ideas on trade across the border. In fairness, there is still a lack of clarity by the European Union and the United Kingdom. Yes, we welcome the agreement on a common travel area, a soft border and full support for the Belfast agreement, of which I was one of the negotiators, but what does the statement made pre-Christmas mean? It promised,
“full alignment with those rules of the Internal Market and the Customs Union which … support North-South cooperation”.
It seems to me a meaningless fudge at the present.
Clause 11 refers to our devolved institutions in the United Kingdom. Those of us from Northern Ireland will consider this closely, as we have experienced the advantages of devolution since 1921.
Northern Ireland has just experienced a record number of tourists last year, and today our unemployment level is not only smaller than that in the European Union or the Republic of Ireland but even less than that in Great Britain. I never thought I would see that day.
In particular, as farm structure and size of farms are different from those in England, we will want to ensure that after Brexit agricultural policy will be a devolved responsibility at Stormont. What will be the future of the European Union’s prestigious geographical indicators, such as Parma ham and cheddar cheese? We have an interest in this because we have two in Northern Ireland—Lough Neagh eels and Armagh Bramley apples. After Brexit, will the European Union maintain them, or will the United Kingdom take over authority for these designations?
Finally, there is not only the Irish border but the border between Gibraltar and Spain. In Northern Ireland, we have a special interest in Gibraltar, as many people were evacuated from there to Northern Ireland or born in Northern Ireland during the Second World War. I trust that the interests of Gibraltar will be upheld and that the European Union will not give Spain a veto over any final EU-UK agreement that would wreck the agreement.
Lord Balfe (Con)
My Lords, I begin by drawing attention to my entries in the register as the serving chairman of the European Parliament pension fund and vice-president of its former members association, both of them 28-country organisations. I am not a UK president of something but a European one, and that probably gives noble Lords some idea of where I am coming from on this.
I have been involved in international affairs all my working life, from the age of 16, when I began as a junior official in the Crown Agents at 4 Millbank, opposite this House. Indeed, my first visit to the House of Lords—to sit up there—was when I was an official in that department. Whether it did any good or not I will leave to noble Lords to judge.
I regard this as the greatest single failure of my political life. I firmly believe not just in the European Union but in the wider concept of multilateralism: the idea that we need to do things together, whether through the UN, the Council of Europe, the European Court of Human Rights, the UN agencies or the European Community. I am a firm believer in that idea, and all the evidence, from a lifetime in international affairs, leads me clearly to the point that we work better when we work together. We may not get everything, but we certainly work better.
This is a withdrawal Bill. I know of no club, anywhere, where you get better terms from being outside it than from being in it. That is why they set up the club: to give members benefits. We, outside the European Union, can talk about what sort of result we want, but the fact is that we cannot get as good a result. I have returned this afternoon from talking to a delegation to Parliament from Norway, and I put that specific question to them. They told me, “Yes, we’re outside the main decision-making structure. When we want to influence something, we have to go to another country and convince them to raise our case alongside theirs”. Indeed, when I was in the justice ministry in Oslo not that long ago, someone said that the most important desk in that ministry was the one with the direct telephone line to Stockholm. However we delude ourselves, the fact is that whatever deal we get, it will not be as good as if we were inside.
I am particularly concerned at the impact that withdrawal may—I say may—have on organised labour. As some noble Lords know, I have a long connection with the trade union movement, and I have noted that the Government have given a good number of assurances. I will, however, be carefully reading three excellent briefings I have had: one from Greener UK, one from Liberty, one from Amnesty, and of course one from the TUC. We will be watching very closely and seeking agreement and undertakings from the Government that the safeguards won from Brussels will not be threatened. We need to protect existing rights, for instance to equal pay, and to transpose Article 157 of the treaty of the European Union—and its judgments—into the situation that we have after we leave the European Union. We also need to safeguard all the other labour advances that have been won.
We need to make sure that we do not, as Philip Hammond indicated we might, start competing by reducing workers’ rights. In an interview in the German newspaper Welt am Sonntag, “World on Sunday”, a year ago, he stated quite clearly that,
“we could be forced to change our economic model and we will have to change our model to regain competitiveness. And you can be sure we will do whatever we have to do”.
We will be watching Philip Hammond carefully. We will obviously not be the only people watching him, as he has a whole raft of people watching his every move—he probably has a spy cam in his bathroom. But we will watch carefully to see that things are protected.
Finally, Clauses 7, 8 and 9 give Ministers powers that seem worryingly wide. I hope that the Opposition will join us in opposing them, but to my own side I say: “Would you be happy for Mr Jeremy Corbyn and Mr John McDonnell to have these powers in their hands, to change legislation in ministries without reference to the democratic structure? That is what these clauses do”. I was always brought up to believe that you should look at the worst-case scenario, and believe that the person whom you really do not want driving the train is in the driver’s seat. So I challenge my Front Bench: how many powers are you willing to give our dear friend Jeremy?
Baroness Liddell of Coatdyke (Lab)
My Lords, I will not answer that question.
It was very obvious when the Bill was passing through the other House that it was not fit for purpose. That has been dramatically emphasised with the report from the Constitution Committee, ably introduced this morning by my noble friend Lady Taylor of Bolton, and it is the job of this House to take a badly drafted Bill and try to make it into something adequate for the purpose. Yet we are doing it with what is probably the most historic and significant Bill that any of us have ever dealt with.
I suppose it is inevitable that when a Government put a party before country, their life will get very complicated. Prime Minister Cameron did that when he called the referendum; he was putting a tactical issue within the Conservative Party to the nation and assuming it would get us out of a hole. It did not, and we find ourselves now in a very difficult position. The noble and learned Lord, Lord Hope of Craighead, said in a forensically argued speech that the Bill, in the way that it was written, was “naive and … damaging”. I agree. The noble Lord, Lord Newby, cited “arrogance and incompetence”. There is a pattern emerging here. Almost everything that the Government have touched in relation to Brexit and the detail of Brexit has come catastrophically unstuck.
Parliament fought for, and was granted, access to the sectoral analyses that the Government had denied they had. Like many noble Lords, I spent an afternoon going through those sectoral analyses. It left me with a distinct feeling that we, as parliamentarians, were being taken for fools. They were shallow, unilluminating and frequently ill-thought out. They looked for all the world like a diversionary tactic. I have spent a better afternoon in bed with the flu watching replays of “Babe” and “Babe: Pig in the City”. It was a complete and utter waste of time. But should I have been surprised, when the Government have evaded every opportunity to be open and frank about the choices the country faces?
The noble Lord, Lord Higgins, put it succinctly in a powerful speech this morning by saying that under the guise of not hampering the direction of negotiations, the Government refuse to reveal anything. But by their bashfulness, they reveal what many of us have suspected all along: that they do not know the direction of travel or the destination. That is a very dangerous situation to be in.
The noble Lord, Lord Tugendhat, talked about financial services. We were promised an analysis in financial services. This is critical. There are a million jobs in financial services and we cannot get from anybody an indication of how the regulatory framework and the legal framework are going to work. This is not about the fat cats of the City; it is about the people who live in the next street to me and work in Glasgow, and others who work in Edinburgh, Leeds and Bristol. We need to make that information available to business; not to do so is unacceptable and extremely risky.
We hear a lot about free trade agreements and how they will sort out our difficulties with financial services. Free trade agreements deal with goods. Services are not traditionally covered in free trade agreements. On a couple of occasions they were tried and knocked back. It is not going to be easy to get an FTA relating to financial services, and everybody is pretending that it is not going to matter. Meantime, we have the Prudential Regulation Authority saying to all the big institutions, “You have to have your worst-case scenario ready”, and most of them know that it has to be ready by the end of the first quarter, at the end of March.
The noble Lord, Lord Hill, put it well when he said that there was a need for speed, honesty and certainty. That is true right across the board. I say in relation to Ireland that we have not got the speed, the honesty and the certainty about the nature of borders. Where I come from in the west of Scotland, the history of Ireland was regularly played out until a few years ago, when the Good Friday agreement resolved an awful lot of the issues. We have already talked about Gibraltar and the other territories, but it is critical in relation to the devolution settlement that we stop mucking about on this. Noble Lords have spoken with much greater authority than I ever could—despite having been, at one stage, Secretary of State for Scotland—about the detail of the devolution settlement, which could lead us to a constitutional impasse of quite significant proportions. Quite frankly—let us talk base politics—this is a gift to the separatists, and the longer we muck about on this the greater the gift is.
We are in a ludicrous situation where a Prime Minister cannot even make a speech that sets out the direction of travel. The noble Lord, Lord Dobbs, in a very witty speech, talked about how we need to behave ourselves or we will start losing powers here—actually, some of us would say, “Bring it on. We think this place needs to be reformed”. I say to noble Lords in every part of this House: we are one of the most expert Chambers in the world, so let us use that expertise, for the good of our country, to try to make some sense out of this badly flawed piece of legislation. Frankly, if we cannot do that, we always have my noble friend Lord Adonis’s alternative.
Lord Teverson (LD)
My Lords, it is a great pleasure to follow an excellent speech by the noble Baroness, Lady Liddell, but it is not a pleasure for me to be speaking in this debate about withdrawal from the European Union. That we are having it is even less of a pleasure for my daughters, who are in their 20s.
The noble Viscount, Lord Ridley, mentioned a lot of economic indicators. Some are true, but a whole host of others are not anything as good as that. The Government’s forecast for the future of the economy has not been good, as we have seen in yesterday’s report. But that is nothing compared to the hit that we have taken to our international stature and how we have been seen abroad diplomatically through how we have handled these negotiations. I weep at how we have portrayed ourselves to the international community in terms of this nation’s ability. This nation should not just be leading Europe, as the noble Lord, Lord Foulkes, said, but be standing proud in the United Nations—as one of the five permanent members of the Security Council—and in all the other bodies that we are still in. We have devalued ourselves. That is not good when we start to enter international negotiations on trade.
One of the best pieces of advice I have heard recently was, “Never tell a computer that you’re in a hurry”. Many noble Lords know why. That is nothing in comparison with when you are in trade negotiations. We are facing some of the most hard-nosed and experienced people there are, and the fact that we are in a hurry, desperate and concerned to get a deal quickly will mean that we seriously erode our negotiating ability. That sincerely worries me.
The Bill deals with bringing the acquis on to the British statute book. One of the areas that is missing in the acquis is economic and social cohesion. It is in Article 174 of the Treaty on the Functioning of the European Union, and states that one of the missions of the European Union is to reduce disparities between regions within the EU. When I was a Member of the European Parliament, I was proud of ensuring, through facts and rational argument, that my part of the world—Cornwall—received some of the highest levels of European intervention. That has enabled, among other things, Cornwall to have a highly successful university campus that has done the economy a great deal of good, yet I do not see that aspiration moving across. One of the great things about European economic and social cohesion policy is that it is based on facts, evidence and rules. As we move forward with a different regional policy in the UK and in England in particular, my fear is that we will move back to the old ways—so political influence, lobbying and the other areas of pork-barrel politics will mean that the right decisions about regional aid will not be made and the disparities within England and the United Kingdom will not be met fully by the future regime. I want those values, that guidance and that evidence-based method of deciding where regional aid goes brought on to the UK statute book through the Bill.
I am also concerned about the environmental side. Yesterday, we debated the 25-year environmental plan. I was delighted that it states that the “polluter pays” principle is important. I congratulate the Government on including that in the plan, but let us bring the precautionary principle into the Bill. The fantastic 1987 Brundtland report Our Common Future started to change the way we looked at sustainable development globally, and it was reinforced at the Rio conference in 1991. This principle is in European statute, and it is important for our environment that we transfer it. I hope the Government will bring forward suitable arrangements on animal sentience within this Bill, not in a following agriculture Bill.
Finally, the noble Lord, Lord Krebs, mentioned the report of the energy sub-committee of the European Union Committee that I chair. Every bit of evidence that we had from the sector said that we should remain, if possible, in the internal energy market. That will be very difficult if we are not inside the single market, but it is something that we need to find a way to do, otherwise our energy prices, energy trading and energy security will not be where they need to be. Euratom—an organisation we did not even need to withdraw from—was not on the referendum question paper, and there we need to be very clear that we have continuity between our current membership, through transition to our future relationship, otherwise our whole nuclear programme will be threatened.
Coming back to our international reputation, I was asked by someone on the other side of the argument why everybody always seems to accept what Mr Barnier says and not what the Government say when we are in negotiations. I believe we have had an abysmal record on negotiations, as I have said to the House before, because everything that Mr Barnier says seems to come true, while everything that the Government say disappears in smoke. That is, once again, damaging to our international reputation. I hope through this Bill, somehow, we can start to mend that.
Lord Wilson of Dinton (CB)
My Lords, I am very pleased to follow the noble Lord, Lord Teverson, particularly on the question of trade negotiations. In the mid-1960s I was a very junior member of the team that negotiated the Kennedy round. I learned some lessons about trade negotiations then, one of which was that they do not bring out the nice side of other people: they bring out hard-headed self-interest and require grind, and the last thing you should ever be is in a hurry. He is absolutely right.
It goes without saying that the House must allow the Bill to pass. It would be unthinkable to try to wreck it or block it: it would do damage and the country could not afford the chaos that would follow if the Bill were in some way to not reach the statute book. That is not worth spending time on. But the Bill does need to be improved, which is where this House is absolutely in its element. This is a great opportunity for the country that we must use. We must protect and promote the sovereignty of Parliament. It is amazingly ironic that a strategy which claims to be motivated by the wish to restore sovereignty to Parliament appears to be trying to do it by bypassing that sovereignty. We cannot live with that.
If I may indulge one prejudice, it is that I hate the word “appropriate”. When I was in government, if I saw any draft in any official document which had “appropriate” in it, I would reach for my red pen. In my experience, it is either an indication of sloppy thinking by someone who has not thought out what they mean, or it is devious—and neither is right. “Appropriate” is inappropriate for this Bill, and I shall lend whatever weight I have to supporting anyone who comes up with better phrasing. That should be one of our agreed objectives.
I would like to ensure that the Bill protects the human rights of people who live in this country and am baffled by the exclusion of the EU Charter of Fundamental Rights. That needs careful examination. But we must, above all, protect the unity of the United Kingdom. I am alarmed by the position we are in on Northern Ireland and the risks that we are running. The use of slippery language, however clever—and “alignment” is, in a kind of awful way, clever—could lead to terrible consequences and slip over into things which no one ever intended.
Clearly, we have a big task and there is more one could say, but we need to ensure that the task of implementing the Bill is manageable and something that the Civil Service can do. I am constantly impressed by the scale of the challenge which the Civil Service faces now—the biggest challenge of any generation since the Second World War.
The right reverend Prelate the Bishop of Leeds used a lovely phrase, “corruption of public discourse”, which he deplored. That phrase should linger in the air, because it is what we are experiencing at the moment. I put in a plea that the Civil Service should not become subject to the corruption of public discourse. There appears in the press to be a tendency for Ministers, ex-Ministers and MPs to blame or play politics with the head of service and people who work for him. I have great admiration for Sir Jeremy Heywood and the people who serve the Government with him. I have absolutely no doubt that they are putting their very best people and efforts into serving the Government to the extent that they possibly can, and I deplore anyone who imputes lower motives to them.
If a Minister starts blaming his civil servants, I always sense that they are shifting the blame because they sense the failure of their own policies. They should say to themselves, “The fault, dear Brutus, lies not in our stars”—or in our civil servants—“but in ourselves”. The trouble is that the people who argued for Brexit knew what they wanted to get away from but are not agreed about where they want to go to. That means that we are still in the most divisive phase.
Our membership of Europe has always been divisive. It was divisive in the 1960s, and it has been divisive in the Conservative Party and the Labour Party. There is nothing new about that. But at the moment Brexit is making it a bitter division. If Brexit were to have a successful outcome, it would need by now to have generated a growing swell of support—a sense that, even if you did not like it, something was going to happen. That is not what we feel at all at the moment.
I am not starry-eyed about the EU—I think it has weaknesses and flaws—but I would favour continued membership because I believe that giving up our membership will leave us economically poorer and politically weaker. We should play our part from the inside and not pull out. But we are where we are. We have a flawed Bill and a flawed strategy, we have to try to limit the damage and I intend to lend my vote to that wherever I can.
I have one final point. The eyes of history are on us: they are on everyone involved in Brexit. History will be written by the young, not by our generation. It will be written by the young, and the young are in large part passionate in their wish to remain members of Europe. I think history will be very harsh on people who argue for Brexit and make a mess of it.
Baroness Eaton (Con)
My Lords, I declare my interest as a vice-president and former chairman of the Local Government Association.
As did many Members of this House, I began my political career as a local councillor. I have seen first-hand how services can be improved by devolving powers over them to local areas rather than running them from Whitehall. Brexit should not simply mean a transfer of powers from Brussels to Westminster, Holyrood, Stormont and Cardiff. We have an opportunity to do things differently, and to do them better.
The White Paper on legislating for withdrawal from the EU stated that leaving the EU is an opportunity to ensure that,
“power sits closer to the people of the UK than ever before”.
To my mind, that means that we must devolve power to our communities. We also know that legislation concerning education, housing, social care and numerous other issues has been improved by the involvement of local government. Parliament benefits from the experience that many Members gain from serving in local government and working for the LGA and its members.
At present, local government has a formal advisory role in the EU law and policy-making process through its membership of the Committee of the Regions. The committee has made sure that the voice of local communities is listened to and informs law and policy- making. Just one example of its work is its successful campaign to block an attempt to set binding EU targets for the renovation of local authority properties. Despite MEPs supporting the Commission’s proposals, Ministers supported the committee’s view that the targets would set an intolerable £5 billion burden on local councils, and that a more general objective for each member state would better respect the principle of subsidiarity. In my eyes, this does not mean that the committee has been perfect; it certainly has not. We do not wish to leave one large bureaucracy and create another home-grown version. I am not recommending that we recreate the committee, and neither is the LGA. However, it is important that we ensure councils have a formal role, as new legislation that affects them is brought before Parliament.
I know that the LGA, together with the local government associations in Wales, Scotland and Northern Ireland, has been in discussion with the Government about how councils’ advisory role might be continued once we leave the EU. It is positive to read that the Government have already had constructive discussions with local government about how the consultative rights that councils have at European level, through the Committee of the Regions, might be replicated domestically, without recreating the committee.
I hope that these discussions will continue to make progress and the Minister will be able to update the House with a solution.
Baroness Symons of Vernham Dean (Lab)
My Lords, in opening the debate this morning, the noble Baroness the Leader of the House said that the Bill is not about our future relationship with the EU, but about process. As my noble friend Lord Foulkes said, the Bill paves the way to our leaving the EU while setting aside a series of treaties that this country, this Parliament and, in particular, this House, spent hours and hours debating in the 40 years of our membership. As other noble Lords have emphasised, the Bill also has real constitutional consequences for us here at home, and in this Parliament—notably regarding the powers of Ministers, but also regarding our relationship with the devolved Administrations.
My noble friend Lady Taylor of Bolton spoke of the disappointment of the Constitution Committee that the Government have totally failed to address the concerns published some time ago in her committee’s interim report. Its latest report, published only yesterday, reiterates the serious issues that the Bill still raises about Northern Ireland. The Good Friday agreement took years of patient negotiation, first by the Major Government and then by the Blair Government. This is now a matter of critical concern; the relationship between Northern Ireland, as part of a United Kingdom that has withdrawn from the EU, and a southern Ireland that remains as part of the EU, is a very important issue, as my noble friend Lord Hain and others have emphasised.
In answering the debate tomorrow, I hope that the Minister will respond to the Constitution Committee’s recommendation that, before the completion of the Bill’s passage through this House, the Government publish an assessment of the effect of the Bill, and of the UK’s withdrawal from the EU, on the Good Friday agreement. This is a specific recommendation from one of the most highly respected committees of this House, and it deserves an answer from the Minister.
As the right reverend Prelate the Bishop of Leeds said, in what I thought was a very powerful intervention, too much of the debate on our relationship with, and withdrawal from, the EU has descended to a level that undermines all intelligent democratic argument. This Bill does nothing to retrieve the balance necessary to inform decision-taking.
In June 2016, the British people voted—not overwhelmingly, as some have tried to imply, but certainly decisively—to leave the European Union. The Government accepted that decision, and so did Parliament. The decisions ahead now must lie with a Parliament that is well informed and has real powers and rights to advise and amend government policy, as my noble and learned friend Lord Falconer emphasised.
As the noble Lord, Lord Bilimoria, said in his tremendously spirited address, the essence of democracy is that people can change their minds when they have more information or real experience of how a Government are performing. We had an election in May 2015 and another one in June 2017, the second one called by a Prime Minister expressly and explicitly to strengthen her negotiating hand in Europe. The British people voted in such a way that her negotiating hand was not strengthened; it was badly damaged and weakened. So surely the British people may well need to be consulted again at the conclusion of the negotiations—consulted on whether the Government have delivered a satisfactory result in terms of our leaving the EU. This Bill may not be the right vehicle for legislating on that point but, as a democracy, when those negotiations are at an end, the British people should be consulted as to whether what they voted for is what this Government have been able to deliver.
Lord Luce (CB)
My contribution will focus solely on the position of Gibraltar in the context of the broader negotiations between the United Kingdom and the European Union. I declare an interest as a former Governor of Gibraltar and as chancellor of the new University of Gibraltar.
I appreciate that this Bill applies only in a limited way to Gibraltar, but there is a need to provide firm reassurances at every stage about its future. I am glad that the Leader of the Opposition and other noble Lords have referred to this issue. It is worth reminding the House that Gibraltarians voted in the referendum by a majority of 96% in favour of remaining in the European Union. It is not surprising, therefore, that they are concerned to protect the rights and benefits that they have acquired since joining the EU with the UK in 1973. The best way in which to reassure them is to provide legal guarantees in addition to ministerial statements. This is a matter that can be probed in Committee.
Gibraltarians have every reason to feel anxious about the future, because the new EU negotiating directive issued by the European Council reaffirms clause 24, which featured in earlier negotiating guidelines. This clause purports to give Spain a veto over the application to Gibraltar of any agreement concluded after the United Kingdom has left the European Union. I am glad to note that HMG do not accept the legal validity of this clause, but the fact that Spain has persuaded the European Council to incorporate this clause in the negotiating guidelines is most unhelpful. While clause 24 does not apply to this Bill, Spain is putting pressure on the EU for the clause to apply to the proposed transition period as well as any longer term arrangement between the United Kingdom and the EU. Neither is acceptable.
Therefore, we have a scenario where, in the worst case, Spain can seek to exclude Gibraltar from any broad agreement between the EU and the UK and insist on a separate agreement over Gibraltar. What we do not want is a situation whereby the British Government are faced at the end of the overall negotiations with a stark choice either to accept the general agreement with the EU and exclude Gibraltar or to postpone the general agreement until we and Spain can agree on Gibraltar’s future arrangements.
The Prime Minister of Spain, Mr Rajoy, said on 14 December 2017:
“Whatever future agreement between the EU and the UK, there has to be an agreement between Spain and the UK for that to apply to Gibraltar. We also asked that this applies to the transition period”.
Moreover, in the recent past, Gibraltar has had to face plenty of provocation from some Francoist elements in the Spanish Government both on the Gibraltar border and within the UK-Gibraltar waters. The treatment of Catalonia gives us no encouragement. The Spanish bullfighting culture still emerges from time to time.
We must bear it in mind, of course, that, before any final general agreement, there has to be unanimity among all 27 EU partners. Moreover, most of us will feel that it is very much in the interests of Spain and the UK that there should be a satisfactory resolution. Good relations between us are important, and, in any event, both countries and Gibraltar stand to gain by a co-operative arrangement across the border as 40% of the Gibraltar workforce crosses from Spain into Gibraltar each day to work. The Andalusian region around Gibraltar stands to gain from economic collaboration. That means that orderly arrangements for the border are essential. This points to the need for the Spanish and British Governments to work in their common interest on Gibraltar and well before any final agreement on the EU is put to Parliaments.
Against this background we need to reassure the people of Gibraltar. The Prime Minister has confirmed to Parliament that Gibraltar will not be excluded from the negotiations for either the transition period or any future agreement and that we will take account of the interests of Gibraltar and its unique relationship with the EU. It is good that the Joint Ministerial Committee on Gibraltar is working effectively and in a positive way. However, the people of Gibraltar need not just reassuring words but clear legal reassurances, wherever possible, that their acquired rights, which are in existence now, are preserved through this Bill, and that both the transition and the final outcome apply to them.
Most importantly, access to the UK market for Gibraltar’s well-regulated financial services remains vital for it constitutes 90% of all Gibraltar’s business with the EU. This and future growth must be guaranteed for the future. There must be no discriminatory treatment against Gibraltar at any stage as a result of this Bill or any forthcoming legislation concerning our arrangements with the EU. Anything that can be done in this Bill and future ones to reinforce this point will help ease the minds of Gibraltarians. They have been loyal to us in good times and bad. We in turn must do whatever we can to assure their future.
I look forward to the Minister’s response. I hope he will confirm that the Government are committed to providing legal as well as verbal assurances to the Chief Minister, Mr Picardo, and the people of Gibraltar.
Lord Blackwell (Con)
My Lords, while noting my business interests as set out in the register, I would like to make it clear that I will be speaking in this debate and at later stages of the Bill in a purely personal capacity as a Member of this House.
Listening to the debate, I note that many views have, of course, been expressed around the House on the merits of what we are embarked upon. Noble Lords will know that I was, and remain, a supporter of the argument that Britain had no option but to leave the European Union as it progressed towards political and economic union. Despite what the noble Lord, Lord Bilimoria, said, after the Lisbon treaty we were not signed out of that. However, those arguments are now behind us. Article 50 has been triggered and I urge all noble Lords, whatever their past views, to now come together to ensure that we make the best of the future that we will now have outside the European Union. I was pleased to hear that view echoed in many contributions from around the House.
I will make two points based on what I have heard. First, as we debate the Bill, it is important that we promote a positive and optimistic view that encourages the nation to seize the opportunities ahead of us. The decision to leave was not, for me—or for most people, I believe—primarily an economic equation. But while we of course hope that the European Union will agree to an arrangement that upholds its principles of free trade with our large, neighbouring but independent economy—for its benefit as well as ours—we should be confident and optimistic about our ability under any scenario to compete and prosper as an open, global trading nation in a world where growth will be driven increasingly by the faster-growing new economies around the world. I therefore ask those who are unhappy about our decision to leave to cast aside their pessimism and avoid overstating the negatives, for the greatest damage we can do to our UK economy is to undermine confidence by talking ourselves down, both domestically and in the view we project to overseas investors.
Much is made of economic forecasts, but economic forecasting is not a science, and the reality is that the output of economic models largely reflects the assumptions fed into them. The truth is that the UK economy has been and remains resilient. As my noble friend Lord Ridley pointed out, we did not plunge into a recession in 2016, and strong economic growth continues to defy the economic pessimists. Unemployment has not soared; instead we have 400,000 more people in work than a year ago and the lowest rate of unemployment since the 1970s.
As we look forward we should recognise that we will continue to have a huge competitive advantage as a nation in our culture of innovation, our legal and political systems, our language, our flexible labour market, our strong and high-value service sector and our global network—not least with the somewhat neglected but fast-growing Commonwealth countries. We should see those countries as our gateway to the future growth economies, not dismiss them as a relic of the past. All these factors will be increasingly important advantages for the UK as we move into a new era where the basis for economic success is transformed by the revolution in digital technology and artificial intelligence. These are areas where we in the UK are already building a strong entrepreneurial base. Our success in managing this economic transformation will have a far greater impact on our future employment and living standards than the margin of error on current economic forecasts. It is a much more important area to focus on.
As I said, our future as a nation is not just about economics; let us talk positively about the opportunities of our vision for Britain as an open, outward-looking global trading nation. If we view everything from the negative mindset that we are engaged just in damage limitation, we will never inspire people to seize those opportunities and will do our country down.
Secondly, we in this House can also do our bit to remove uncertainty and build confidence by giving the Bill, which the other place has approved, a fast and supportive passage through this House. I recognise that many noble Lords have expressed concerns about the provisions for secondary legislation that will enable EU law to be transcribed into our own legal base. While it is clearly right for these powers to be scrutinised, we need to be realistic about the scale and urgency of the task. The powers are rightly circumscribed by a two-year sunset clause.
I do not accept the argument that some make that it is somehow less democratic for a UK Minister in an elected Government to lay a statutory instrument for our Parliament to approve than it is for that law to be imposed by European institutions that can override the UK Government and Parliament. I have sat for periods on your Lordships’ committees looking at delegated powers and the merits of statutory instruments, and I have a high level of confidence that our process of scrutiny—with the additional procedures suggested by my noble friend Lady Evans—will be able to hold Ministers and civil servants to account.
I therefore strongly support the passage of the Bill through our House and I urge other noble Lords, whatever their past convictions, to join in building confidence in this country’s future success.
Baroness Miller of Chilthorne Domer (LD)
My Lords, yesterday in your Lordships’ House we were paddling our canoes up the pleasant reaches of the environment plan, warmed by cosy aspirations and promises. But I am afraid that today our paddles will be swept away and our canoes overturned as the tsunami of Brexit sweeps away environmental protections. The pleasant aspirations of the environment plan are absolutely no protection compared to that offered by the EU directives.
We are being asked to take it on trust that such important things as the “polluter pays” principle, the sustainable development principle and the precautionary principle will be properly applied. But trust will not save a single habitat or clean up a single river. We are asked to take it on trust that there will be a strong statutory body capable of holding the Government to account. The difficulty is that that body may not be created for years, if at all, it may not be strong, and it may be underresourced. In the meantime, there is a solution to all this. There is no reason why the Government cannot put the principles I mentioned in the Bill. Currently, we do not even have a full list of the environmental functions carried out by EU bodies or which UK bodies will fulfil them in future so that we can see what is urgently needed beside the legislation that we must amend in the Bill.
The Environment Secretary proposes only a consultation on a new policy statement on environmental principles to apply post EU exit. This consultation will explore the scope and content of a new statement on environmental principles to underline our commitment. That is not nearly enough. Our job in this House is to make the Bill fit for purpose to protect the environment, making sure that the protections for habitats, species and people are all enshrined in the Bill.
I agree with the right reverend Prelate the Bishop of Leeds that the Bill should not just talk about the economy, which so many noble Lords have talked about. We will be diminished by Brexit culturally, scientifically—our scientists are no longer part of the network of European research—and in just about every way I can think of, but it will not be so bad for us as it will be for our children and grandchildren. Our natural heritage will not just be diminished but could be destroyed. Even if the Government manage eventually to fulfil their best intentions and bring in protections, there is likely to be a gap of years. We cannot afford to have that gap, which will be taken advantage of by people who would like to make a quick buck by not worrying about the “polluter pays” principle. We therefore need to amend the Bill and make sure that all those protections are in it, as they should have been from the beginning.
Baroness Finlay of Llandaff (CB)
My Lords, 10.17 million people live under devolved Administrations in the UK. They want the best deal for Britain, whichever way they voted. They expect their devolved Governments to argue on their behalf. They did not vote to lose powers. The concern in Welsh and Scottish government is so great that both bodies have unanimously voted not to sign the legislative consent order for the Bill. Why? Because they both want to see a withdrawal Bill that works effectively while respecting devolution.
The devolution settlements are all based on a binary model, with some differences. Scotland’s model of reserved powers will also become the model in April under the new Wales Act 2017. The Sewel convention means that Parliament will not normally legislate in areas of devolved competence without the consent of the devolved legislatures. The word “normally” is important. The situation does not warrant that Parliament should legislate without the consent of the devolved Administrations. We are not in a crisis at war. Ignoring the refusal of devolved consent has never risen before; it is not needed now. The Bill requires careful, considered amendment.
The intersection of EU powers and those of the devolved Administrations has meant the latter’s legislation cannot be incompatible with EU law—a restriction on freedom or competence of legislation and policy-making that currently also applies to Westminster, and which will be lifted by the repeal of the European Communities Act 1972. It is not a question of powers coming back from Brussels, but a decision about where they will go as those restrictions are lifted. Wales and Scotland feel that as far as the effect of the Bill on the devolution settlement is concerned, restrictions on legislative competence in policy areas should be removed, as the Supreme Court said in the Miller case.
This Bill reads differently, however. It proposes changes that put new restrictions—a new set of shackles—on the legislative and executive competence of the devolved institutions, allowing the UK Government unilaterally to lock down opportunities to shape their own policies. There are many examples of policy areas where Scotland and Wales have diverged from Westminster. Take, for example, the charge on plastic bags, minimum unit pricing of alcohol, tobacco control measures at their outset, organ donation now and the different ways in which their health services are organised. The Bill, however, would give Ministers of the Crown powers to make corrections of retained EU law in areas of devolved competence without consultation with the devolved institutions. Such an ability to change an Act of the Scottish Parliament or of the National Assembly for Wales without any input from the legislature or Ministers answerable to it is clearly unacceptable.
The Joint Ministerial Committee with the devolved Governments must become statutory; it is currently not working well. There must be governance arrangements for a group that meets regularly, agrees its agenda well in advance and allows the devolved Administrations to initiate policy proposals. It must also contain a mechanism for the resolution of potential areas of legislative conflict early, without the need to go to the courts for interpretation of the law. Frameworks are also essential to ensure a common UK approach when needed, that respects the principles of the territorial constitution.
Clause 11, as drafted, does the exact opposite. Last September, Wales and Scotland suggested amendments—I have a copy of the letter written by their First Ministers to the Prime Minister. When this Bill went through the other place there were promises of government amendments but none materialised. In her helpful and warm opening speech, the noble Baroness the Leader of the House implied that the development of these amendments is proceeding well. Unfortunately, as of last night, neither the Cabinet Secretary for Finance in Wales, nor the Minister for UK Negotiations on Scotland’s Place in Europe from the Scottish Parliament could reflect such a positive view.
The constitutional implications are great. If the devolved Governments are forced—and I use the term advisedly—to push through the continuity bills that they have drafted in order to allow them to function effectively on behalf of their population, then we really will be faced with a constitutional crisis. Therefore, I ask the Minister for reassurance that amendments will not be sprung on us at the last minute and without adequate consultation with the devolved Administrations. We in this House must not be put in the invidious position of making decisions that run counter to good government arrangements between the Governments of the UK, and which concern over 10 million people. To borrow a phrase, “nation must speak unto its nations”.
Lord Bowness (Con)
My Lords, like other noble Lords I accept that if there is to be Brexit, there has to be a Bill for legal certainty. But it must not give rights to the Executive at the expense of Parliament, and it must be sufficiently flexible to cope with circumstances which over the period of our negotiations may change. It must also ensure that our future is determined by Parliament. In the words of the noble and learned Lord, Lord Hope of Craighead, the Bill is in a sorry state and Members have the right to support, speak for and, if necessary, vote for amendments within the constitutional parameters of this House. We should not be frightened off by my noble friend Lord Dobbs: this is not “House of Cards”.
It is very easy to answer questions by accusing the questioner of trying to thwart the will of the people. I, like many others, feel I have been the victim of a prolonged hijack, and I believe that hard Brexit is a minority interest. In 2010, David Cameron opposed a referendum, but eventually, after pressure and rebellion, capitulated, and in the 2015 election promised the in/out vote on the reform he had negotiated. How was it that immediately after the referendum the Government adopted an extreme position of no to the single market, no to the customs union, and no to an EFTA, EEA, Norway or Switzerland-type arrangement? We heard a great deal about the Government’s need for the freedom to negotiate without disclosing their hand to Parliament, but at a stroke we declared to a bewildered world that we wanted out of everything yet wanted a deep and special relationship with the EU—the “have your cake and eat it” position. This was maintained at the 2017 election and is now portrayed as the choice of the people because of the referendum and general election votes.
In neither of these campaigns did anyone explain the effect of these policies. To be fair to hard Brexiteers, perhaps they have only just become apparent. The hijackers, as I see them, seem to be in denial about the existence of problems despite the evidence, and the attacks upon the Chancellor and, indirectly, the Prime Minister suggest that their fervour for a hard Brexit is undiminished. Was the Ireland/Northern Ireland situation explained? Frictionless borders mean nothing when it comes to the detail. Did we explain that new arrangements for trade will need a mechanism to resolve disputes? How is a tribunal which is not a UK court different in principle from the Court of Justice of the European Union? Did anyone explain that if there was no deal, customs delays would have a serious impact on the pharmaceutical and motor industries, to name but two? In such industries, small, frequent and rapid shipments are the name of the game.
We were assured that no deal is better than a bad deal and that we could trade on WTO rules, but who explained that tariffs are only part of the story? The UK and the EU cannot grant each other more favourable terms than each is prepared to grant other World Trade Organization countries. We are told that we should have no problem dealing with the EU on WTO rules, as do the US and China, but were we told about mutual recognition agreements—MRAs—which are principally concerned with non-tariff barriers, and are arguably more important than tariffs? The United States has 135 such agreements with the European Union. Without a deal we would not only have no agreements with the European Union but also abandon the MRAs that the EU has with countries like the US and China. The MRAs are not simply WTO rules: they have to be negotiated.
The noble Lord, Lord Hain, has already referred to the 60 or so free trade agreements that the European Union has with other countries. We cannot just pick these up at will. There will have to be negotiations between the European Union, ourselves and third countries. It already appears that a joint submission to the World Trade Organization by the European Union and the UK on the division of quotas has been objected to by the United States, Australia and New Zealand. Perhaps the Minister will bring us up to date on how well that is going?
Let us have no more of how easy it will all be if we revert to WTO rules. That claim is in the same category as the £350 million on the side of the bus. However good a deal we get, it cannot be as good as the one we have now as members of the European Union. This game, as I said in an earlier debate, is just not worth the candle, so it makes sense that, if there is to be Brexit, the changes to the current arrangements should be as small as possible. Even at this late stage, the idea of the single market, the customs union, membership of EFTA or the EEA, or even the status quo should be not be removed from consideration.
It is therefore vital that the Bill before us gives Parliament, and principally of course the House of Commons, the opportunity to extend the proposed leaving date, to establish a meaningful transition or implementation period, and to have a meaningful vote, including rejecting any deal and certainly no deal. I am certainly attracted to the idea of the Government seeking a mandate, as outlined by the noble and learned Lord, Lord Falconer. It is a matter for Parliament and, although I share many of the sentiments of the noble Lord, Lord Adonis, I cannot support calls for a referendum when we have so recently seen how flawed and misleading such campaigns can be.
Like millions of other citizens, this hijacked citizen wants to be freed. I do not want to be on a ship which is steering a course through dangerous waters to a place unknown when there is a known and safe haven available. I want reality to dawn and our citizens to be told the consequences of the policies that we have adopted to implement their decision. Yes, we can leave the European Union if we must, but we can head for a safe haven—there is no need deliberately to sail into uncharted and rocky waters.
Baroness Drake (Lab)
My Lords, this Bill preserves existing EU law as it applies in the UK, converting it into domestic law as retained EU law to provide legal continuity and certainty on exit day. It gives Ministers extraordinary correcting powers to amend such retained law where they consider there is a deficiency. We are therefore in, as the Constitution Committee observes, “uncharted territory”, so it is unsurprising that many organisations have expressed concerns that the Bill gives rise to ambiguity about the status of the different categories of retained EU law and that the Government are given abnormally wide powers to amend legislation.
In Committee, this House will examine whether those powers are greater than are needed for the task in hand, if and how they should be restricted, and the level of transparency and scrutiny that precedes the deployment of those powers. As my noble friend Lady Taylor of Bolton referenced, the Constitution Committee expresses the view that the overly broad powers that the Bill grants to Ministers to do whatever they think appropriate to correct deficiencies in retained EU law are “constitutionally unacceptable”. It goes on to suggest controls, such as “good reasons” statements, to be put in place on the proposed use of those powers.
Many important areas of law will be impacted by the Bill, and I want to reference workplace and equality rights—clearly a people’s issue. Clause 2 preserves EU-derived domestic legislation when the UK exits. That is important, as it addresses many EU-derived equality, employment and health and safety standards and rights, including where existing UK law has exceeded minimum EU standards—for example, on important maternity leave rights. Examples of other rights include the Working Time Regulations, the Transfer of Undertakings (Protection of Employment) Regulations, agency workers’ rights and equal treatment for part-time workers and fixed-term employees.
Clause 4, importantly, preserves the right to equal pay for equal-value work, which flows from Article 157 of the Treaty on the Functioning of the European Union. The impact that Article 157 and the accompanying EU Court of Justice case law have had on women’s pay and pension rights in the UK cannot be overstated. However, there are deep concerns that the “correcting powers” which the Bill affords to Ministers could be used to weaken such rights, including those contained in existing Acts of Parliament, such as the Equality Act. A range of workplace and equality rights in retained EU law could be vulnerable to change by subordinate legislation contained in other Acts of Parliament when that retained law does not have the enhanced protection that flows from EU membership.
Last December, the Prime Minister failed to rule out scrapping the working time directive, the agency workers directive and the pregnant workers directive. Maternity rights and part-time workers’ rights appear at risk. As the Fawcett Society powerfully observed, it would be regrettable if Brexit and this Bill resulted in the loss of the opportunity to be the best place in the world to be a woman.
There needs to be a robust process of scrutiny to ensure that executive powers in the Bill cannot be used to make changes in significant areas of policy and enhanced protections for key rights. There is also the question of Court of Justice of the European Union case law post exit, which the noble Lord, Lord Kakkar, spoke about at some length. Domestic courts will not be bound by such case law, but there are strong arguments to be put in Committee that courts should have regard to such judgments where they are relevant to the proper interpretation of law which originated from the EU. Without such regard, people in the UK may see their rights weakened.
It is also unclear how provisions in the Bill may be affected by future negotiations. During any transition period, the UK may not be able to weaken retained EU law. Future agreements on UK and EU relations may require the UK to comply with EU law, including on workplace rights. We need to understand those implications when we look at this Bill.
Finally, I return to a matter that I have raised previously. It may not seem significant to many in the great scheme of economic affairs, but it is hugely important to the people affected, and that is the need to replicate the protections from violence against women and girls post exit day. Women and girls at risk of violence may lose significant legal protections. European protection orders, which grant victims equivalent protection against perpetrators across the EU, will no longer be available to UK citizens. The ability to share data on perpetrators and a host of other measures aimed at tackling human trafficking, female genital mutilation and the sexual exploitation of women are also at risk. We need to understand how these rights and protections will be preserved post exit day.
Lord Shipley (LD)
My Lords, it is a pleasure to follow the noble Baroness, Lady Drake, and to have listened to her important observations on equalities and employment rights, and the potential for them to be weakened in this and other Bills. I congratulate the noble Lord, Lord Bowness, on his excellent demolition of a hard Brexit. As he said, a hard Brexit is a minority interest. Indeed it is.
In an earlier contribution, the noble Lord, Lord Hill, said that there is political paralysis caused by Brexit and that the Government need to reduce uncertainty. I agree with him, and I agree with all those business leaders who are urging the Government to start showing some leadership, given that we are half way through the period allowed by the triggering of Article 50. It is staggering that so little has been done and equally staggering that the Cabinet seems incapable of even proposing what it wants from our future trading relationship with the European Union.
Much has been said about the need for frictionless trade with the EU, and I think we are all in favour of that. However, I am prepared to acknowledge that frictionless trade means that we must stay in the single market and the customs union and that, if there are substantial changes to those structures, we will need a transition or implementation period of several years. Two years or less from March 2019 is simply not long enough, given the enormity of the changes that would be required. Anything other than staying in the single market and the customs union will hit investment, jobs and growth. There is already evidence that growth is lower than it could be and that it will go on being so, caused entirely by the uncertainties over investment that Brexit is causing.
That point was made recently by the Governor of the Bank of England, who estimated that Brexit is costing the UK about £200 million a week in lost growth. This is compounded by the fact that there now seems to be some evidence that all the uncertainties are causing the banks to get increasingly nervous about company borrowing levels post Brexit, and they will be looking closely at companies seeking to borrow without having developed a secure post-Brexit business plan. A failure of companies to invest is in no-one’s interest because it will cost growth and jobs.
Exit from the customs union will lead to soaring red tape, with new customs rules and paperwork, as the CBI has pointed out. It will hardly be frictionless. VAT will have to be paid up front. All the major changes will come as a huge shock for tens of thousands of companies that export only to the European Union that currently have frictionless, borderless trade and that have no experience of the paperwork required to export to places other than the European Union. How will those companies understand the required documentation and the rules?
I have heard it said recently that the Government are yet to train the people who will train the staff in the relevant companies. What checks are being made by Ministers on who is doing the necessary preparatory work and what resources are going into it? How many businesses might lose business because they do not know what they should be doing and fall foul of the rules? We should note that the French announced recently that they expect to spend three years training their customs staff.
In a recent report, the National Audit Office said that the Department for International Trade is struggling to develop specialist trade skills among staff and has therefore slowed down its work. Apparently, one of the problems is that staff have moved too often in Whitehall. The failure to deliver trade deals will lead to less growth and fewer jobs, yet the Department for International Trade has had an extra £25 million in the current financial year to prepare for Brexit. What has that been spent on?
I conclude that there is so much uncertainty that the British people have the right to be consulted again on the terms of Brexit, as negotiated. There are two reasons for that. The decision to leave the EU was made in a referendum. Constitutionally, I find it difficult to see why the people should be denied the right to a final say on the exact terms of Brexit once Parliament has debated those proposed terms. I draw the attention of the Minister to the fact that, in recent polls, the majority of the public want a referendum on the final terms. The last one I saw, a few days ago, showed 58% support for a confirmatory referendum. However, importantly, 85% of 18 to 24 year-olds and 74% of 25 to 34 year-olds wanted the right to vote on the final terms. I do not think we can disregard the views of young people, who will have to live with the consequences of Brexit. I agree entirely with the noble Lord, Lord Wilson of Dinton, who a few moments ago talked about this issue. As I recall, he said that we have to bear in mind how history will judge harshly those who disregard the views of the young.
Lord Empey (UUP)
My Lords, naturally I want to begin by referring to the Irish border question, as we are one of the regions most affected by the decision taken in 2016. I believe that the question of the Irish border has almost been weaponised in this debate because, in my view, the scale of the problem has been grossly exaggerated. Statistics are dangerous things, but I want to give some figures from the Irish Central Statistics Office. In 2015, imports to the Irish Republic from Northern Ireland accounted for 1.6% of total Irish imports. Coincidentally, the percentage of exports to Northern Ireland from the Irish Republic amounted to 1.6%.
Of course, that does not tell the whole story. It is perfectly obvious that there are local issues, particularly around agriculture, the movement of animals and things of that nature, and the processing that continues. We have to put this into perspective, however. When people bandy around language about threats to the Good Friday agreement, most of those making such claims did not negotiate the Good Friday or Belfast agreement and, as far as I am aware, have not consulted any of us who did. We should bear in mind that we should be cautious with language, because people are using this for political purposes. It has been used deliberately in the Republic, by Sinn Fein, to try to create a huge crisis. It is a difficult issue—there is no question of that—but I believe that there is a will on both sides of the Irish Sea to resolve it. I also believe that the United Kingdom Government will not put up a border. The only threat of a border comes from Brussels forcing the Irish Republic to put one up, and we all know that, politically, it is impossible for them to do so. Therefore, we have to look at alternative mechanisms. There are quite a number at our disposal. I appeal to colleagues to remember that when they use such language and this example, it is seized on by elements not in favour of a peaceful outcome and a settlement within the constitutional framework that the agreement set out to achieve.
I am glad that the noble Lord, Lord Foulkes of Cumnock, is back in his place. Earlier, in his contribution, he said that he wanted the devolved Administrations to have a legislative consent Motion and that one from each of them would have to be in place before a decision could be taken. I hope he realises what he is saying. He would be giving a veto on the future of the United Kingdom’s position in the European Union to Sinn Fein because it would have the ability in the Stormont Assembly—if it were functioning—to veto any legislative consent Motion, irrespective of the terms. He must understand that that is the inevitable consequence of what he is saying. I accept that there are consequences to and difficulties with the devolution settlements. People need to realise something about the powers that would naturally come back to the devolved Administrations. The devolved Administrations —and the United Kingdom as a whole—have not had any input on, for example, agricultural policy for 46 years. We have no capacity at the present time, let alone the devolved Administrations.
Energy is another key issue. We have constructed, or are trying to construct, an all-Ireland energy market, but it is not an energy market on its own. It is connected by both gas and electricity to Great Britain, and our UK energy market is physically connected to France. Clearly, big issues there need to be resolved. I also want to make a point about mutual recognition agreements, particularly as they apply to things such as medical devices. The CE safety mark that applies to many goods is one of the matters that we will have to thrash out as the legislation proceeds and other Bills come before the House.
I close by making the point that we talk about the wonderful trade opportunities we have. That is true, but we are still running an £80 billion deficit with the European Union. While it is vital to maintain the maximum amount of trade that we can, there is something seriously wrong with how we are doing business if we have a £1.5 billion a week loss on trade, week in, week out. What is wrong with us? There are clearly other policy issues. Our membership, or lack of it, of the European Union is not the whole story. It is a part of it but not all of it.
One thing I became aware of recently was that many people in this country feel an allegiance to the European Union that almost exceeds their allegiance to the United Kingdom. I had not been aware of that before. I understand that there are lots of people out there to be convinced, but we have had the referendum. It was an “in or out” referendum and the Head of the Government made that clear. Parliament passed the law and, whatever our position as a party—already alluded to by the noble Lord, Lord Kilclooney—it is done. We should get on with it and get the best possible deal, but trying to rehash the thing will merely create further division and leave us with no prospect of a future.
Lord Hamilton of Epsom (Con)
My Lords, I shall address the amendment to the Second Reading of the noble Lord, Lord Adonis, which calls for a second referendum. It has rather been dismissed because noble Lords say that this is not the Bill to amend in that way so we should not consider it. But we should consider it because around the House there seems to be a certain amount of support for the whole idea of a second referendum. That raises more questions in my mind than it answers.
The first question is: when would we have the second referendum? Would it be in October this year, when the negotiations should have been completed and before it is ratified by the 27 different countries in the EU and the EU Parliament? Or, would it be when the agreement had come back, having been ratified in March next year, just before we leave the EU under the Article 50 provisions? Or, let us face it, the devil is always in the detail, and we could go through the next 21 months laid down by Michel Barnier and have the final agreement with the EU. The problem is that at that point we would have left. There is a timing problem that needs to be addressed by those in favour of a second referendum.
The next question is what you put on the ballot paper. Do you ask: “Do you like this deal, and if you do, do you want to stay in the EU?”, “Do you dislike this deal and still want to stay in the EU?”, or “Do you dislike this deal and would like to leave the EU”? It is complicated, whichever way you look at it. It is so complicated that all it would do is create more confusion, rather than anything else.
Then there is the noble Lord, Lord Foulkes, who would like a parliamentary vote to say that we have changed our minds and we will stay in the EU. I ask him what position that puts me in. I have campaigned to leave the EU but Parliament tells me that I cannot. There I am, with a decent majority in the country who voted in the referendum to leave, but Parliament says, “No, it was all a great mistake and we should stay in”. I have no option then but to take to the streets because I cannot get any representation in Parliament. All I can do is protest outside Parliament.
Lord Hamilton of Epsom
We have dealt with the referendum. The referendum is extremely complicated. I do not know that there would be a clear answer.
The accusation is that the Government have negotiated extraordinarily badly. I will not defend the negotiations; I think we played a weak hand very badly. But at the end of the day, these negotiations go on with the EU. Before we could continue the negotiations, three totally bogus things were raised. One was that we had to agree on the Irish border. Hold on: the Irish border will be the only land border that we have with the EU when this is all over. How can we separate that from a trade deal that we do with the rest of the EU? It is absolutely ridiculous. How can you treat EU citizens living in this country separately from the immigration policies we will have with the EU when a final deal is done? Then there is the money. It was said that we must agree on the money before we agree anything else. I heard somebody say the other day that it was rather like walking into a restaurant and calling for the menu and for the waiter to come along and say that you had to pay for your dinner before you had even ordered it. The whole thing is ridiculous.
The bill for what we had to pay started at €100 billion. It has come down a bit, I am glad to say. But why are we being accused of being intransigent? The noble Lord, Lord Wilson, said that there was a great argument for not being hurried. Hold on: I have never stopped hearing from the EU that the clock is ticking and that we must get on—all these ridiculous elements have been raised that we must deal with before we can move on. As far as I can see, all the delay has come from the other side, not from the Government.
Then there is the constant argument that we do not know what we want. Yes we do: we want an ad hoc free-trade agreement with the EU so that we can carry on selling things to it and for it to sell more to us, as we have been doing so far.
I finish on the whole issue raised by the noble and learned Lord, Lord Hope of Craighead. He asked a viable question about the powers taken under the Bill. I have campaigned for years to try to get powers back from Europe. Let us face it: those powers are massive, as the noble Lord, Lord Pearson, reminded us. The Henry VIII provisions were used to impose EU edicts on Parliament. I am not in the business of seeing the Executive taking all those powers. We should re-strengthen Parliament and take advantage of that at this stage. Maybe we should have a sunset clause so that these powers lapse after a period, but it is not our business to see the Executive strengthened as a result of the Bill.
Baroness Thornton (Lab)
It is of course a great pleasure to follow the noble Lord. I did not agree with very much of what he said, but I was trying to imagine him out on the streets, which gave me pause for thought.
Being No. 54 of 190 speakers, there is a possibility that I have might say something that has not been said before. We have heard some wonderful speeches about the defects and gaps in the Bill, and I bow in deference and gratitude to the recommendations of the Constitution Committee, whose report will help us enormously in the next stages of the Bill. But as we all know, only when legislation is applied to real-life issues—the consequences for people, their jobs, families and well-being—will we identify the gaps and unintended consequences. In many ways, like my noble friend Lady Drake, I want to talk about people’s issues. However, I believe that the noble Lord, Lord Empey, is quite wrong when he says that the Northern Ireland border issue is being exaggerated. My family in Cavan do not agree with him at all. Why would we put in jeopardy the Good Friday agreement?
As the Labour health spokesperson, I will address my remarks to the realities of Brexit for our NHS and research. Like many noble Lords, I too have received briefings from many different sectors and many say the same thing—that their sector needs to remain within European Union regulatory regimes to thrive, and they plead for clarity and certainty about what will happen. That plea echoed around this Chamber in speech after speech today. I am grateful to Cancer Research UK and the Association of the British Pharmaceutical Industry for their work on clinical trials regulation.
The UK has been heavily involved in developing the existing regime, which will harmonise the assessment and supervision process for clinical trials via a central European Union portal and database, currently being set up by the European Medicines Agency. In 2019, the new regime kicks in and this presents a problem of great uncertainty. This means that the clinical trials regulation, the CTR, will not automatically be captured by this Bill. It is not clear whether the UK Government will look to align with the regulation or seek access to the EU portal and database, and in what timescale. As a priority, the Government should immediately provide greater clarity on plans to ensure UK alignment with the EU clinical trials regulation. What specifically will be the mechanism for UK access to the portal and database?
I cannot think of a more potent issue than alignment with the clinical trials regulation when discussing access to innovation and new medicines. Cures for rare and childhood cancers, for example, and rapid UK access to them are at stake. Similarly with drug regulation, when will the Government offer certainty that the UK will have agreement with the EU to ensure we can continue to take part in the EMA’s centralised procedure for drug licensing? Any future drug-licensing system must not exacerbate delays in access to the most innovative treatments for patients in the UK and across the EU. Again, certainty is needed.
Equally, people are at the heart of this Bill—people who work in our health service, both the scientists and the medical staff, who move across the European Union with ease at present. Can we be confident that the Home Office will design a future immigration system that enables us to attract, recruit and retain global scientific talent at all professional levels, regardless of their nationality, and the nursing and other medical staff who enable our NHS to function?
And what about the patients? I know and welcome the good intention of the Government to continue some version of the European Health Insurance Card, which symbolises the many benefits that the European Union brings to all its citizens. However, even my inexpert reading of the Bill suggests that this will be an extremely difficult or impossible thing to obtain. As one expert said in his evidence to the House of Lords European Union Select Committee:
“European governments did not adopt mechanisms to allow their citizens to access healthcare elsewhere for reasons of altruism. The welfare of a drunken participant in a stag party in Prague or Krakow never entered their thinking. Instead, their goal was to support one of the European Union’s four fundamental freedoms, the freedom of movement of people. Quite simply, a single European labour market would be impossible if those moving for employment, either permanently, or … on a daily basis, could not be assured that they would be looked after if they became ill”.
The same applies to those who live in Europe. This flies in the face of this Bill and the Government’s stated intentions, and it leads me to my last point—honesty.
When will the Government be honest with the people of the UK about what they will lose post Brexit in their access to healthcare if they travel and work in Europe, and indeed in many other matters revealed today in the leaked impact report? Almost every sector of the British economy included in the analysis would be negatively impacted in all the scenarios, with chemicals, clothing, manufacturing, food and drink, cars and retail the hardest hit. Just when will the Government come clean about how this will affect people and their families?
Lord Brown of Eaton-under-Heywood (CB)
My Lords, I am happy to follow the noble Baroness, Lady Thornton, particularly as on this occasion she has said nothing to make me change my speech. I remain a remainer but, for the purposes of this Bill, regard that as a complete irrelevance. As many have said, this is a necessary continuity Bill to transpose EU law, which represents a large part of our existing law, into UK law when we repeal the 1972 Act. In short, it will avoid a huge legal vacuum if and when we leave the EU.
That said, save in one eventuality only, the entirety of this Bill could and in some ways—pace the noble Lord, Lord Wilson of Dinton—should more appropriately be dealt with not here but in the next Bill. The withdrawal agreement and implementation Bill will come along later in the year when, one hopes, we will know—at least to the extent of heads of agreement—the basis on which we are leaving. The one eventuality in which this Bill truly would be crucial would be if—one hopes it is a remote “if”—the Government at some point abandoned negotiations for an agreed withdrawal and we simply crashed out of the EU on exit day. Then indeed, with no prospect of a later Bill, a continuity Bill to keep our laws intact would be required. That eventuality apart, why can all these provisions, as to what should be retained law and our future approach to it, not be part of the implementation Bill?
In all probability, we will initially leave by a transition, implementation or standstill period—call it what you will. During this period, we will continue to recognise the jurisdiction and jurisprudence of the CJEU. Given that, surely the point at which EU law will be frozen and, as retained law, become part of UK law will be at the end, not the beginning, of that transitional period. Clauses 2 and 3, which in effect freeze EU law as at exit day, will have to be amended, presumably by the implementation Bill itself rather than by any of the highly contentious regulation-making powers in this Bill, most notably Clause 9(2).
Incidentally on the question of the Bill’s regulation-making powers, not only do Henry VIII powers—executive powers to repeal or amend primary legislation —need to be curbed; so too we should place controls on the Executive’s power by secondary legislation, which is generally unamendable and not that closely scrutinised, to implement policy decisions that are more properly the subject of primary legislation.
That takes me to the Constitution Committee’s recommendation in yesterday’s report that “retained direct EU law” should have the legal status of “domestic primary legislation”. That is a most interesting recommendation. Instinctively I am inclined to agree, in so far as it would prevent retained law being changed merely by executive regulation by secondary legislation. However, I am less convinced that retained law should not be subject to the Supreme Court, as proposed under Clause 6(4)(a) and 6(5), being able to depart from it as it can from its own or previous House of Lords decisions under what lawyers know as the 1966 Practice Statement—exceptionally and only for compelling reasons. That is essentially the test now proposed in the Bill.
I have a final word or two about the Charter of Fundamental Rights being disapplied by Clause 5(4). I see no good reason to retain the charter. We are of course retaining the Human Rights Act and our full acceptance of the reach of the European Convention on Human Rights. The convention and the Supreme Court’s ever-growing readiness to invoke our own historic common law, as necessary, fully meet our human rights requirements. It is true, as the noble Baroness, Lady Smith of Basildon, pointed out in her speech, that David Davis himself invoked the charter last year when making his complaint against the UK about investigatory powers, but all that is now expressly taken care of in the Data Protection Bill that we have just passed on.
The charter, I suggest, would needlessly complicate things to no good purpose. It is, at best, of uncertain reach, applying as it does only to the implementation of EU law, which is, of course, to become a past concept. The present criteria for deciding the scope of EU law is already described as “incredibly ambiguous”. The charter, of course, consists both of rights, essentially mirroring ECHR and other international law rights, and of principles. The latter are mostly social and economic, are really aspirational and without direct effect. In short, I accept the Government’s arguments on the charter, but clearly there are aspects of the Bill that will need amendment and we look forward to 10 busy days to deal with those.
Lord Patten of Barnes (Con)
My Lords, if the Foreign Secretary were able to be with us today—we should be so lucky—he would doubtless remind us of the story in Sophocles’s “Oedipus” about the great Sphinx that devoured young Thebans if they could not answer its riddles. I think that the great Sphinx in British politics for the last two or three decades has been our membership of the European Union: it is making a pretty good job of devouring the Conservative Party and a good deal else in politics. How has it happened? I follow my right honourable friend Kenneth Clarke in making this point. I joined the Conservative Research Department in 1966, partly because the Conservative Party was intent on getting this country into what was then called the European Common Market. Throughout my time in politics, the Conservative Party has been in favour of us playing a leading role in the European Union. I was a Minister in Margaret Thatcher’s Cabinet and a Minister in John Major’s Cabinet. So what happened?
As noble Lords know, we joined the European Union when we were being called the sick man of Europe. We pretty well got the European Union on our own terms. There have been a couple of important, significant changes along the way. First was the single market, with the Single European Act sustaining us. If they were here today we could say, “Take a bow, Margaret Thatcher and Arthur Cockfield”. The other big change over the last few years was the enlargement of the European Union, again very largely the result of the leadership of this country and of Conservative Governments. Those have been changes, I concede that, but I do not think that they are the sort of changes that should deprive us of our senses. There has been, of course, another change, which is the referendum and its result. Referendums, my noble friends will recall, were described by Margaret Thatcher as,
“a device of dictators and demagogues”.
No demagogues here, of course. There was a bit of alliterative ranting by one of our noble Viscounts earlier, but no demagoguery in this place. So why did we have this referendum?
The whole House knows that for many years it has been recognised that loyalty is the secret weapon of the Conservative Party. Sometimes, as John Major would remind us, it is so secret that it can be barely discerned by the human eye. The whole House knows that we had this referendum in order to try to manage the Conservative Party and it blew up in the Government’s face. So now we face not just the consequences for our international affairs but the consequences for the way in which we do politics in this country, as my noble friend Lord Higgins indicated so eloquently in his speech. I hate referendums. If we vote at some stage to have another referendum on membership of the European Union, I will oppose that legislation. I think that referendums are appalling and a sin against parliamentary democracy.
I have talked about secrets. There is another secret that concerns me. During the referendum campaign, the Secretary of State for the Environment said that, once the negotiations began, we would be in the driving seat. The secret is: where are we going? What are we driving? Is it a bandwagon or a hearse? What genuinely surprises me is that so many of my honourable and right honourable friends spent all those years moving from safe house to safe house under cover of dark to arrange what has now happened, plotting and scheming away to get it, and when we get there they do not know what to do. They have forgotten the rest of the trick. I have to say to my noble friend who spoke earlier that his approach to what we should be now doing seemed to me a tad broad brush, rather like his espousal of civil disobedience.
I just hope that at some stage we can find out what the Government want to do, particularly in relation to the Northern Ireland border with the Republic. I listened to my noble friend Lord Empey, but I also listened to two former Secretaries of State for Northern Ireland and to a former Cabinet Secretary. This is a serious issue. If A equals B and B equals C, then C equals A. If Northern Ireland is to have a frictionless border with the Republic and Northern Ireland is, as it will remain, part of the United Kingdom, then the United Kingdom as a whole will have a frictionless border with the European Union, unless we are going to redefine the borders of Northern Ireland. We are in a position where what suits Belfast suits the United Kingdom: it has to. I do not take what my noble friend Lord Empey said about Sinn Fein seriously when this Government are being sustained by the DUP. I hope to have the opportunity when we get to Committee of moving one or two amendments about the relationship between the border and the Good Friday agreement.
In the meantime, I look with horror at what is happening. There is a great line in Shakespeare’s “King John”:
“So foul a sky clears not without a storm”.
Exactly.
Baroness Royall of Blaisdon (Lab)
My Lords, that was a superb speech. The sky is indeed foul, but it is up to us to try to do something about it.
The speeches today and tomorrow are many, but there will be few disagreements. The vast majority, like mine, will show acute concern about the rudderless nature of the Brexit misadventure, the lack of vision or of preparation and the fact that, as the noble and learned Lord, Lord Hope, said, the Bill comes to us in a sorry state. I am profoundly dismayed about the way in which the Prime Minister continues to put party before country, desperately trying to find a fudge that will keep her in government, if not in power, and placating the Brexiteers, whose thirst for leaving the EU is unquenchable. I fear that this fudge will mean that everything possible will be done to ensure that the much-promised meaningful vote will not be about a firm framework for the future but rather about a heads of agreement which has been described as an expression of intent and aspirations. As ever, for the Prime Minister it will be the politics of her party rather than the policies for our country that will determine success if we exit the European Union on 31 March next year.
All the detailed negotiations that will determine the future prosperity of our country and the security of our citizens will, as we always advised, take place after 31 March, during a transition period. That is crazy. The detailed negotiations will take place at a time when we will have no voice and no influence in the Council, the Commission or the European Parliament. I realise that because of the all-pervading influence of the Brexiteers it would be anathema, perhaps suicidal, for the Prime Minister to suggest that, rather than a lengthy transition, we should seek to extend the Article 50 deadline, but that would be the right thing to do. It would ensure that Ministers remained in control during the negotiations. We are constantly told that the main reason why people voted to leave the European Union was, indeed, about control.
I share the concerns expressed about this fundamentally flawed legislation: the undermining of legal uncertainty; the extension of delegated powers; the impact on our economy and quality of life, et cetera; the impact on the protection of jobs and the rights of workers and consumers; the impact on the protections for women and girls, including those that they currently get from the European protection orders; the guarantee of the peace process; and so much more.
My right honourable friend Sir Keir Starmer did a brilliant job in the Commons and has shown real leadership and huge skill in extending the parameters first set down by my party. I know, too, that my noble friends Lady Smith and Lady Hayter will do likewise. Indeed, they will provide great leadership for this House. I will certainly support their amendments, which, I am sure, will receive wide support across the House. I will also, however, urge them to go further and to embrace membership of the single market and the customs union, which is critical for all parts of the United Kingdom, especially Northern Ireland. That is what we have agreed to do as part of the transition process, but for the sake of our economic and social well-being we need it to be permanent. If we do not secure our economic future in this way, we will not be able to implement the education, health and social policies that are urgently needed to heal our deeply divided society and address the burning inequalities identified by the Prime Minister.
In some of the poorest areas of the UK, EU funding has made a huge difference. It is essential that areas such as Cornwall and the Isles of Scilly, which would have qualified for £350 million from EU structural funds in the next budgetary period if we remained in the EU, continue to be properly funded. Can the Minister reassure me that there will be a properly funded, locally led successor to EU regional aid?
Focusing briefly on education, I remind noble Lords of my interests in the register. In Oxford in 2015, 18% of our staff, 15% of our students and 14% of our research funding came from the EU. Each of those areas is now being undermined by Brexit. In terms of research, development and innovation activities, in the last seven-year financial framework the UK as a whole contributed €5.4 billion to the EU and the EU contributed €8.8 billion to the UK. Not only is the UK the most active participant in Horizon 2020, but our institutions co-ordinate about 20% of the projects that have been funded so far. Our collaboration and our influence are extraordinary. With Brexit, the number of EU academics resigning has gone up exponentially, suggesting that it is increasingly difficult for our universities to attract the best in the world. This is critical for our research and our reputation.
What assurance can the Minister give that our new relationship with the EU will not jeopardise the ability of our universities to participate in future EU framework programmes and conduct world-class collaborative research with EU colleagues, to host ERC grants and influence future research agendas or to recruit and retain the best staff, and to recruit students, regardless of nationality? We should heed the words of Chekhov:
“There is no national science, just as there is no national multiplication table; what is national is no longer science”.
Research and innovation are just two of many areas in which we collaborate with our European partners: exploring ideas, exchanging best practice, finding common solutions to common problems, benefiting our own citizens as well as those in other countries and strengthening relationships. Some partnerships are bigger than others, but all contribute to fostering understanding between peoples and organisations.
I am proud that the People’s History Museum, which I chair, recently secured €271 million from the EU as part of the Culture Lab project involving partners from six member states. Our pilot project will explore the impact of Brexit on migrant communities in the UK and the EU and we will work with local migrant and non-migrant communities to explore how, as Jo Cox said,
“we are far more united and have far more in common than that which divides us”.—[Official Report, Commons, 3/6/15; col. 675.]
For me, those words encapsulate not only what I believe to be the reality of the United Kingdom but the reality and the ethos of the European Union. In 2012, the EU received the Nobel Peace Prize for advancing the causes of peace, reconciliation, democracy and human rights in Europe. The right reverend Prelate the Bishop of Leeds was absolutely right. Membership of the European Union, and what comes afterwards, is about more than trade and the economy; it is about values, tolerance, respect, a space to disagree agreeably and hope not hate. In this difficult and dangerous world, it is our responsibility to seek the best possible outcome as we break our ties with this alliance of sovereign states, which has changed our continent and our country for the better.
Baroness Northover (LD)
My Lords, we know that Brexit would initiate a major constitutional, political, social and economic change to the United Kingdom. The right revered Prelate the Bishop of Leeds was right to address the wider social and cultural implications. The economic factors themselves, however, have serious political and social effects. Perhaps it is not surprising that we have had strong populist movements since the financial crash of 2008. We should therefore heed the noble Lord, Lord Bilimoria, and indeed Mark Carney, when he notes that Brexit is already costing the United Kingdom around £200 million a week in lost growth.
Today we hear that the Government have finally undertaken economic impact assessments of three possible outcomes, ranging, in effect, from soft Brexit to no deal. In none of these scenarios is our economy as strong as it would be if we remained in the EU. Anyone who has read the so-called impact statements that were hidden away in DExEU cannot but be chilled by the worries from stakeholder after stakeholder about leaving the EU. In sectors such as the life sciences industry, higher education and other service sectors where the UK has a leading edge, the challenges are most acute.
Yet no one knows quite where we are heading, as the chiding of his Government by the noble Lord, Lord Hill, made clear, as did the noble Lord, Lord Patten, in an amazing speech. The Government cannot reconcile the diametrically opposed forces in their own party to plot a way through. The passionate speech from the noble Lord, Lord Bridges, made that clear. Suggesting one course produces a massive abreaction from one side. Suggesting another, an abreaction from the other. Hence the poor officials who draw up legislation and are sitting in the Box today have been mandated to give wide powers to Ministers, depending on the outcome of negotiations and where a future Government wish to head.
However, that will not do. Even the noble Lord, Lord Strathclyde, hints that it might not. In the Sanctions and Anti-Money Laundering Bill there was the same dilemma, with wide Henry VIII powers proposed—or Oliver Cromwell powers, to take the point of the noble and learned Lord, Lord Hope. The Government should know from the sanctions Bill what is likely to happen here. An amendment on this constitutional matter, in the name of the noble and learned Lord, Lord Judge, won by 80 votes. The noble and learned Lord has already offered his services to parliamentary counsel on the sanctions Bill. This Bill could do with his services, too. The Minister on the sanctions Bill must have been acutely aware that those seeking to tackle those constitutional affronts were rightly called Hope, Judge and Pannick.
There are of course other changes that we should seek in this Bill. We must ensure that Parliament will be given a meaningful vote on the deal, as other EU Parliaments will, as was noted by the noble Baroness, Lady Smith of Basildon. Given that this process started with a vote of the people, surely the people should be given a vote on the deal. As the noble Lord, Lord Mandelson, pointed out, whether the UK was in or out of the single market or the customs union, for example, was not on the ballot paper. The Government have emphasised that no UK citizen would lose rights as a result of leaving the EU. It is difficult to square that with losing the right to live and work elsewhere in the EU.
There are, however, further threats in the Bill. I briefly mention those in three clauses. The powers in Clause 7 could, for example, be used to water down the Equality Act 2010, as Maria Miller and others pointed out in the Commons, and as emphasised today by the noble Baroness, Lady Drake. Clause 8 addresses Britain’s international obligations. My noble friend Lord Wallace of Saltaire outlined the challenges here. We know that the UK’s role globally will be reduced by being outside the EU. The Commons Foreign Affairs Select Committee reported today on serious understaffing in embassies across Europe. This must be addressed, if we are to engage as Ministers suggest, but we will have reduced resources with which to do that. We have already seen our reduced influence when we could not secure a second term for the UK judge in the International Court of Justice. This was for the first time in its history and despite lobbying hard through our embassies across the world.
Clause 8 does have a protective subsection, which my noble friend Lady Bowles borrowed for the sanctions Bill. It says, for example, that,
“regulations under this section may not … create a relevant criminal offence”,
which is something we had to knock out of the earlier Bill. But as the Constitution Committee notes, we still need to limit the powers here to those that are necessary and reasonable. Then we come to the astonishing Clause 9, which in effect allows a Minister to modify more or less everything in the Bill and, it seems, any existing law. I think not.
There will be close scrutiny of the Bill in this House. I hope the Government will be as open to working with us as they were on the Sanctions and Anti-Money Laundering Bill. They will have heard the voices behind them, as well as those to the side of and in front of them. I am sure they know that we cannot simply give them and all future Governments a cheque book full of signed blank cheques.
Baroness O’Neill of Bengarve (CB)
My Lords, I have two interests to declare because I shall talk about the movement of people on the island of Ireland and between our islands. I was born in Northern Ireland and am entitled to Irish citizenship as birthright. I currently use a UK passport. My identity is British and Irish, although because of the oddity of UK practices of recording ethnic classification—seemingly contrary to the Northern Ireland Act 1998—I am not allowed to state this for standard UK administrative purposes, and usually have to classify myself as “White other”. I am also on the advisory board of These Islands.
A very large number of questions have been raised about the adequacy of the Bill’s approach to dealing with retained EU law, particularly but not only in the devolved nations. That is the proper focus for this debate; we should concentrate on the constitutional adequacy and competence of the legislation, not on wider questions about Brexit.
The devolution settlements are far from uniform, as we know, which makes it harder to see what is proposed and whether it is adequate. But it is uncontroversial that the Northern Ireland settlement differs from the Scottish and Welsh settlements not merely in its provisions but in its status. Other noble Lords have spoken with more authority on this highly relevant matter. The noble Lords, Lord Hain, Lord Empey and Lord Patten, all mentioned it. This is because the Belfast or Good Friday agreement is an international agreement between the Republic of Ireland and the UK, which, alongside many other provisions, established the North/South Ministerial Council, the British-Irish Council and the British-Irish Intergovernmental Conference. Part 5 of the Northern Ireland Act 1998 mandates participation in the cross-border institutions.
It follows that any moves to change retained EU law after Brexit raise two distinct issues in Northern Ireland—more than two, in fact, but two very important ones. First, as for the other devolved Administrations, it raises questions about changes in devolved matters post Brexit being made by the UK Government, rather than by the relevant devolved Parliament or Assembly. Secondly, unlike the other cases, it raises questions about the UK Government’s commitment to work not only with the Northern Ireland Assembly and Administration—as we all know, these are not currently in action—but, as required by the Belfast/Good Friday agreement, with the Government of the Republic of Ireland and to have regard to the Belfast principles, which include partnership, equality and mutual respect. Will the Government write into the Bill a commitment to meet these conditions in making changes to retained EU law that bears on Northern Ireland post Brexit? What forms of interaction with Northern Ireland office-holders and with the Dublin Government will the Government commit to in order to meet these requirements? Those are my two questions to the Minister.
I believe that clarity about such restrictions post Brexit is vital. We are in the curious situation that although the Government have insisted for almost 18 months now that they do not seek a hard border on the island of Ireland, they have yet to say anything about how this is to be achieved. To be sure, we cannot say much about the trade aspects until those negotiations are further advanced but we can say something about the movement of peoples. Over a year ago, I asked a previous Secretary of State for Northern Ireland how it was to be done. She—or he—replied, I thought a bit casually, “By passports”. That was interesting. Who is to show a passport, where and for what purposes? We know that it is not to be on the Irish border, which is to remain soft, or between Northern Ireland and the rest of the UK, which would be intolerable to our constitutional integrity. We also know that thousands of British and Irish citizens constantly cross the border and the Irish Sea, many of them frequently, without showing passports. Noble Lords who travel only by air often forget this reality. But after Brexit if it happens, Irish policies on the free movement of labour will diverge from those of the UK and there will have to be an enforceable policy regulating the movement of persons.
My own guess is that if there is to be no hard border, any workable approach will require everyone in the UK—not just in the island of Ireland—to have a passport or equivalent secure ID, and to show it when performing significant life transactions such as taking up employment or opening a bank account. I do not think this needs to be a violation of privacy. It would provide less information for better defined purposes than the common practice of carrying a smartphone, but I am aware that this is a sensitive matter for many on the Conservative Benches. That is the sort of nitty-gritty matter which lies beneath the questions of the amendability of retained EU law post Brexit, particularly its adequacy in Northern Ireland. I hope the Government can bring forward an amendment to require compliance with the Belfast agreement in making any post-Brexit changes to retained EU law.
The Duke of Montrose (Con)
My Lords, it is always a great pleasure to listen to the clear, analytical thinking of the noble Baroness, Lady O’Neill.
The Bill implies a fairly radical impact on two areas that have always been at the centre of my concerns: one being Scotland and devolution, the other being agriculture and fisheries. My interests, as many of your Lordships will know, have meant a lifetime spent in farming livestock in Scotland, and I have just retired after five years as president of the National Sheep Association of the United Kingdom. We have heard today from all Benches in this House highlights of the major areas where the Bill will have its effects. I want to look at just two that are major for me. The first is how we deal within devolution with abolishing EU authority when European regulation was the central core of our legislative arrangements. Similarly, the second is how we see the management and support of our rural areas.
The noble and learned Lord, Lord Hope of Craighead, alerted the House to how far the present powers of the Bill simply will not do in the long term for Scotland and other devolved settlements. I am sure the promise made by the noble Baroness the Leader of the House in opening this debate that the Government already have in mind amendments that they wish to bring in offers some promise. But even if those will help us on our way, it is worrying to note the level from which we have started.
My noble friend Lord Bridges of Headley explained to us earlier the task that the Government were faced with in drawing up the Bill. Seen from that Westminster perspective, one can see how it was understood that these measures would give logical, incremental steps to overcoming the problems that leaving the EU will present. But the proposed powers provoke questions as well as answers. From the Scottish perspective—as the noble and learned Lord, Lord Wallace of Tankerness, was alerting the Government—it seems, for a start, that it does not fully fit in with the procedure for implementing legislation that the Scottish Parliament works under. Many noble Lords have centred their disquiet on the extensive Henry VIII powers that are presently contained in the Bill. But nothing has been said here today that matches the panic that the presence of these powers has triggered in the Scottish Government, with dreams of what they might be used for if there were a hostile Administration in Westminster. I know that that is not the plan at the moment, but from their perspective it is something that rears its head.
The briefing document on the Bill, issued by our own Library, said that the Government had issued to the devolved Administrations a list of the various measures that will have to be returned from the EU as we leave. The Library has very kindly provided me with a copy; the list contains 111 measures. This is only to underline the probable emphasis that will affect my second area of concern, which lies in agriculture, fisheries and rural life. Of these 111 measures, 43 will have a direct involvement in these areas. It is also the area covered in the various devolved Acts. Have the Government made it clear to the devolved Administrations how many of these measures they are already prepared to agree to hand over; and if not, why not? This is particularly true of the area which I have so recently been involved in, which is sheep. I think it is generally accepted that this is the section of agriculture that stands to lose the most from any departure from our present arrangements. I am sure many noble Lords are aware that this industry is reliant on Europe for setting present-day market prices. It is also reliant on exports for 35% to 40% of production. No deal could imply tariffs of up to 50% or £2 per kilo at the European border.
As a further illustration of the problems of the Irish border, which were emphasised by my noble friend Lord Patten a few minutes ago, our worries in this area are eclipsed by those of our farmers in Northern Ireland, who export an even bigger percentage of livestock and who might find themselves with a border with the Republic that would also affect not just exports but the very considerable trade there presently is in both directions at all times of the year across that border.
I look forward to seeing how much improvement we can make to this legislation in the coming weeks.
Baroness Lister of Burtersett (Lab)
My Lords, the Bill raises fundamental questions about not just the Brexit process and accountability to Parliament but also, as the right reverend Prelate reminded us in an inspiring speech, our vision of a good society post Brexit. In the Article 50 debate, I spoke about the sense of loss felt by me and by many who wrote to me as we are stripped of our European citizenship and the fundamental rights it affords us. Membership of social Europe has contributed to many of the social and other rights we enjoy today. With regard to the current Bill, fears have been expressed by those speaking on behalf of, among others, women, children, disabled people, LGBT people and workers, and also about environmental protections. How far we are able to allay those fears by strengthening the protection provided for equality and human rights has to be a litmus test of the effectiveness of our scrutiny of the Bill.
The Equality and Human Rights Commission and others have proposed various ways of providing such protection, including the introduction of a constitutional right to equality; the implementation of a socioeconomic duty, contained in the Equality Act 2010; a means of keeping pace with wider European equality and human rights law; and inclusion in the Bill of a clause embodying the principle of non-regression of equality rights, as recommended by the Women and Equalities Committee, among others. On this last matter, the government amendment in the Commons does not go nearly far enough. It does not actually protect equality rights and it applies only to secondary legislation, despite the Minister’s commitment to the Commons that it would apply to primary legislation also. Can the Minister explain why the Government have reneged on that commitment?
The other main means open to us is to retain the European Charter of Fundamental Rights, the key piece of EU law expressly not brought over, contravening the Bill’s “general rule”,
“that ‘the same rules and laws will apply after exit as the day before’”.
I have read the debates in the Commons and, unlike the noble and learned Lord, Lord Brown, I have yet to find a convincing argument to justify its exclusion. We are told that it is unnecessary because it adds nothing new. It will not affect substantive rights, the Leader of the House assured us. But in fact it includes certain rights and principles not covered elsewhere in our legislation, referred to in the Commons as a third category of rights, such as the right to dignity and a number of important children’s rights, including the fundamental duty to give primary consideration to children’s best interests. Can the Minister say how this duty will be protected in the absence of the charter or the incorporation of the UN Convention of the Rights of the Child into UK law?
The Bingham Centre for the Rule of Law warns:
“We will lose fundamental rights protection in certain areas”.
It points out, as did Lady Hermon in the Commons, that, without the charter, the obligation in the Good Friday agreement to an equivalence of human rights protection in Northern Ireland and the Republic is undermined. Can the Minister explain how that equivalence will now be maintained?
Even if, for the sake of argument, it were unnecessary, as the Government claim, what would be lost by now responding to the wide range of organisations, led by the statutory body with the responsibility for promoting equality and human rights, calling for its inclusion? Like the Constitution Committee, I do not understand why an exception should then be made to the general principle of legal continuity. Of course redundant rights specifically connected to EU membership could subsequently be removed, so that is no real argument. As it is, the Government’s position will be seen a symbol of the weakness of their commitment to human rights, despite protestations to the contrary.
The other argument, that to include the charter would sow confusion and legal uncertainty, is contradicted by the legal opinion obtained by the EHRC; by experts on European law, including the group convened by the Bingham centre and the UCL Constitution Unit; and by the appendix to the JCHR’s commentary on the right-by-right analysis, referred to earlier by the noble Baroness, Lady Hamwee. They argue the exact opposite: that its exclusion is a recipe for legal uncertainty. Surely the Government’s aim, as set out in the rather unconvincing right-by-right analysis,
“to maximise certainty and minimise complexity”,
is better met by having all these rights codified transparently in one place.
The Government repeatedly fall back on the protection provided by the Human Rights Act to counter calls for the charter’s inclusion. But given their earlier desire to repeal the Act, forgive me if I do not take much comfort from a commitment to it that is limited to the lifetime of the present Parliament. Wherever we stand on our exit from the EU, I hope that we can be united in our commitment to a society built on principles of equality and human rights, and therefore ensure the retention of the European Charter of Fundamental Rights as both a symbol and a cornerstone of that commitment.
Lord Stirrup (CB)
My Lords, during the referendum campaign I argued and voted for the UK to remain a member of the European Union. I still believe that to have been the better choice, but I and those who think as I do were outvoted, and I must accept that. However, the fact that we are leaving the EU leads me to certain general conclusions about the way ahead. I will touch upon these briefly, as they have been raised in this debate already and are relevant to my approach to the Bill before us today.
I start from the proposition that no one, not one single person on this planet, whatever their political persuasion, can be trusted with power. Of course some people have to hold power and wield it if systems are to work and society is to function effectively—but they should never be trusted while they hold it. Our constitutional solution to this conundrum is to ensure that qualifying citizens have the undoubted and frequently exercised right to throw out those who have the ultimate power to make the laws under which we live and by which we are governed—that is, Members of the other place.
The need for such a check on power is what makes me believe, with regret but very firmly, that, transitional arrangements aside, we cannot both leave the EU and remain within the single market and the customs union as they are currently structured. To do so would leave us exposed to the power of those who govern those institutions and subject to the costs which they would levy upon us, with no opportunity to influence their decisions or to hold them to account. We would be left in a position that in many respects would be similar to that which caused such distress to the American colonists in the 1760s and 1770s.
Equally, it is the need for a check on power that leaves me so very uneasy about several things that are proposed in the Bill. It would give the Government the authority to create laws without parliamentary authority and without adequate scrutiny. That already happens to a degree, but it is the unprecedented scale of the executive power now being sought that is of such concern to me. The Government will say that they need the ability to operate free of parliamentary constraint if they are to cope in a timely fashion with the unexpected twists and turns that they will encounter on the road to Brexit. I accept that argument to a point—but only to a point. Whatever the practical considerations may be, the kind of unfettered powers envisaged in the Bill are dangerous both in principle and in practice.
The stated purpose of the Bill is to ensure that the UK has a functioning statute book the day that it leaves the EU. Very well—that is of course important. But the statute book also has to contain laws that have been arrived at through due process. Nobody could reasonably argue against the requirement for effective laws, but that requirement by itself is insufficient. Effective laws are not necessarily good laws. The Government will perhaps argue that they have already conceded a degree of parliamentary scrutiny through amendments passed in the other place—but these are little more than a broken reed. They give Parliament no real power in the matter.
Having had experience of both sides of the divide, I know that government departments often view parliamentary oversight as a nuisance. They believe that it creates a lot of work over issues that are not of great moment. That can in some cases be true, but it is no reason for weakening such oversight. Like many other noble Lords, I suspect, I have seen a number of occasions when Ministers have used scrutiny override powers, citing the pressure of time. Sometimes the excuse has been valid, but sometimes just a little effort would have avoided the need for such an override. The pre-emption of parliamentary scrutiny has sometimes been a matter of departmental convenience rather than true force majeure.
With this in mind, I am forced to conclude that parliamentary scrutiny is of value only if it has real muscle—certainly much more than is proposed in the Bill. I entirely accept that it is all a question of balance. The trouble is that the proposals before us today are grossly unbalanced and imperil an important control within our democracy. I do not expect the Government automatically to do the wrong thing, but neither do I trust them always to do the right thing. I urge the Minister to think very carefully about the fundamental issues involved here rather than just about the short-term practicalities.
I will support no amendment to the proposed legislation that attempts to derail the Brexit process, but I will be inclined very strongly to favour any amendment that is intended to constrain the largely unfettered power with which the Executive have so unwisely sought to clothe themselves through the provisions in the Bill.
Baroness Hooper (Con)
My Lords, this is a historic debate and I wish to claim my moment in history, just as I felt I was doing in 1979 when I was elected to the European Parliament—the first democratically elected international Parliament in the history of the world. Subsequently, as a Minister in your Lordships’ House, I participated in Council of Ministers meetings leading up to the Maastricht treaty, always hoping that the UK was playing a constructive part in building an economically strong, united and peaceful Europe. I concur with the noble Lord, Lord Krebs, about the often forgotten but most important peace dividend that our membership of the European Union has brought. The only good thing that can be said about the present realignment of our relations with our European neighbours is that it is not taking place in the wake of a war, as happened so often in the past.
We have been assured today that this is just a technical Bill and that, as my noble friend the Leader pointed out, there will be no change on the day of exit. In other words, it may be a change de jure but it is not a change de facto—at least, not to start with. That a transitional period is required if we want a smooth transfer is hardly surprising when we consider the way in which we have been working closely with our partners in the European Community, the European Economic Community and now the European Union for almost 50 years. To be in receipt of many and diverse briefings from organisations and individuals affected and concerned about this Bill illustrates the complexity of what we are facing and the way in which Brexit impinges on so many of our institutions, organisations and citizens.
As far as having a second referendum is concerned, I never want to see another referendum, and certainly not a referendum that brings about constitutional change without at least a two-thirds majority requirement. This is probably the only point on which I agree with my noble friend Lord Hamilton of Epsom, who sadly is not in his place to hear that. I shall follow with interest the arguments in favour of a second referendum, because it is important to understand the thinking of those who think it could work.
In scrutinising the Bill, I shall have particular concerns about the environment and the creative industries. The former has been raised today but not, so far, the latter. I am also taking an interest in the role of the devolved legislatures of the United Kingdom. The noble and learned Lord, Lord Hope of Craighead, put this issue in the right context when he said that this is a constitutional Bill, not merely an enabling Bill, because of the need to take into account the devolved legislatures that did not exist when we joined the European Community in 1973.
I shall concentrate my final remarks on the overseas territories. The noble Lord, Lord Luce, dealt comprehensively with Gibraltar’s special case. In the justified consideration of the border in Ireland, Gibraltar’s border with Spain has slipped out of the spotlight, and there is yet another forgotten border for which we are responsible: the border between Anguilla and France, in the shape of Saint Martin. There are other ways in which these tiny territories are affected. What about British Overseas Territories passport holders post Brexit? Will they still be able to travel freely throughout Europe? There is great concern about that.
At a meeting with parliamentarians from Bermuda today, a question was asked about the exchange of tax information treaties and the common reporting standards treaties which they are obliged to follow within the European Union. What about the European development funding that some of the overseas territories receive? Will that be replaced by direct UK funding? These may seem small matters affecting small groups of people, but they should not be overlooked, and I shall take every opportunity to remind the Government of the need to consult, inform and reassure the overseas territories to keep them in the loop, notwithstanding that the noble and learned Lord, Lord Brown of Eaton-under-Heywood, would probably say that these are matters for the withdrawal implementation Bill—when, of course, I shall raise them again.
This has been an excellent and good-humoured debate so far, and I trust we can continue to avoid a bitter and acrimonious approach during future stages of the Bill. The right reverend Prelate the Bishop of Leeds struck just the right note on that at the outset, and we are indebted to him. I liked the quotation from Margaret Thatcher’s Bruges speech, referred to earlier by the noble and learned Lord, Lord Wallace:
“Our destiny is in Europe”.
I hope that, whatever happens post Brexit, we shall have a strong and enduring relationship with our European neighbours.
Lord Campbell-Savours (Lab)
My Lords, I need to make it clear that the views I am about to express are my own views and not the policies of my party. I campaigned for a yes vote in 1974 and have remained committed to the European ideal for nearly 50 years.
In the March debate last year, I set out my concerns over the direction of travel. It seemed to me that the public was greatly troubled by European inflexibility on subsidiarity and troubled in particular over the operation of free movement, the loose policing of Schengen and the lack of tight control over our borders, which I believe stands at the heart of the leave vote.
I believe that we now need to squeeze Europe on this whole question of border controls and immigration. We need to challenge this EU pillar and seek a new deal. I know there are difficulties, so we need a tough negotiating stance, but we should concentrate on this issue, which is concerning the public. If we hold the line, I am confident we can win a second referendum. With dark clouds of intolerance sweeping across Europe, we now have a duty to act. Let us deliver to the people on the main issue that they voted on, and let the people decide again. Brexit has opened that door.
What do I mean by holding the line? In November last year, a group of highly influential German industrialists launched a petition campaigning to keep the UK in the Union. The lead signatories were all major industrialists, three of them former presidents of the BDI, the equivalent of our CBI. They proposed an alternative to withdrawal, and by consequence, to today’s Bill. I support their initiative. It calls for “A New Deal for Britain” and a rethink. The petition they tabled says:
“We, the undersigned, are deeply concerned about the economic and political impact Brexit will have on Britain and the EU. We believe that mistakes made by both sides will lead to a highly detrimental situation for citizens and companies both the UK and the EU.
In our view, Brussels has too often violated the principles of subsidiarity … and competitiveness as laid down in the Lisbon treaty. This is what helped create the base for the British referendum in the first place. Brussels has contributed to the outcome by refusing to offer the necessary flexibility to let Britain control its immigration.
In Britain, on the other hand, advocates for Brexit failed to communicate the true impact it would have on the economy. Those who campaigned for Britain to remain failed to properly illustrate the advantages of being a part of the EU, especially when it comes to the common market and research programmes.
Meanwhile, ongoing negotiations show that both parties have underestimated the complexity of Brexit. It has also emerged that keeping the border open between Ireland and Northern Ireland without Britain’s continuing membership in a common market may well be impossible. This entails significant risks for peace on the island.
Buying more time will not address the basic fact at hand: if not stopped, Brexit will result in an outright lose-lose situation for both the EU and Britain. More than ever, the EU needs the pragmatic British voice to counter increasing pressure to centralise, socialise and harmonise. That is why we feel obliged to stop this train wreck in the making and appeal to all responsible politicians, business people and citizens: Let us stop them now and avoid a tragedy of monumental proportions!
Addressing the European Parliament … Donald Tusk … opened the possibility of ‘no Brexit’ giving us the motivation to ask the leaders of the European Union to recognize their responsibility for a political turn around by offering the British a New Deal, focussing on subsidiarity, especially in the area of immigration. We remind them of the fact that following the British referendum there has been a remarkable shift among European Governments their thinking on the sensitive subject of migration in the EU.
Likewise, we appeal to London to recognise that it underestimated the complexities of Brexit and its economic and political drawbacks. With a New Deal from the EU, Britain will be able to say that it finally got what it really wanted.
This would also be a New Deal for all other EU member states recognizing the new realities. Not only could they benefit from the continued membership of Britain in the future, they would also benefit from more self-responsibility”.
The key point here is that this was tabled by German industrialists. It shows the movement in opinion in different parts of Europe.
To those who follow our proceedings, the petition is available online, under the title, “A New Deal for Britain”. These German industrialists are not only speaking for British and German interests; they are also speaking for wider Europe. They know what is in the interests of Europe. We should listen carefully to their message and respond positively.
Lord Purvis of Tweed (LD)
My Lords, it is a pleasure to follow the noble Lord. I agree with much of what he said, and I hope that his Front Bench will agree with him before the Bill has passed through this Chamber.
As referred to earlier in the debate, we received a delegation of Norwegian MPs in Parliament this week. I met them yesterday, and as they were leaving, one of the MPs, a member of the EFTA parliamentary group, took me aside and said, “We think in Norway that we have a closer relationship out of the EU than you have in, so what are you going to do now that you will be out of everything?”. The only thing I could think of, as a proud trustee of Sir Walter Scott’s home in Abbotsford, in my beloved Borders, was the quote from “Marmion”:
“O what a tangled web we weave
When first we practise to deceive!”
This measure seeks to disentangle the tangled web of deception by some who put forward the arguments for Brexit in the referendum. It is preparing us for an unknown destination, as many Members, on all sides, have said.
This measure is not just a continuity Bill. It is not merely a technical measure, as some have argued. It establishes a new category of law in England and in Scotland. It alters the characteristics of our 20 year-old, settled approach to devolution. It is worth stressing for those who have made the point on devolution—from my noble and learned friend Lord Wallace, to my noble friend Lord Steel of Aikwood and the noble Baroness, Lady Finlay of Llandaff, in her very measured contribution—that, between the referendum in 1975, the devolution referendum and today, we have had devolution for half of the period that we have been members of the European Union. These are norms and practices which have now been an established part of the British constitution for half the period of time that we have been members.
In the absence of a written, codified constitution, our constitution is based on norms and statutes. As the noble and learned Lord, Lord Hope, and others have said, these norms are being up-ended and our constitution is being affected. As a direct consequence of the Bill, it will be necessary to form new common frameworks of governance within the United Kingdom over policy areas which had previously come under the auspices of the EU. There is some agreement at executive level on the areas that these will cover, but so far there has been nothing about scrutiny and how the legislation will apply to those.
The breaking of the norms is in many ways more significant than the breaking of the rules—norms based on trust, respect and the recognition, as the noble and gallant Lord, Lord Stirrup, said, that those with power need oversight. That is the same when it comes to the relationship between certain component parts of the United Kingdom as it is for the citizen’s relationship with government. These norms have become even more important in the more complex world that we live in.
I have lived all my life in a country that is a member of the EU and its previous smaller Community. The world I was born into in 1974 had 3.9 billion people living in it; today, there are 7.5 billion of us. Then, the world economy was worth $5.5 trillion; last year, it was nearly $77 trillion. Then, there were only 34 democracies in the world; today, there are 87. The expectations of people of their rights and of their hopes of their democratic Governments are exponentially greater now than when we joined the European Union. The world is incredibly more complex than it was then.
It is no surprise, then, that while we hear much about tariffs and trade, the growth in non-tariff measures is now much more significant than the tariff measures. There were 1,500 in the mid-2000s; today, there are 2,500. Because these non-tariff measures are about standards—health and safety, and the environmental standards to which we have become accustomed—it is very troubling that we will see the Trump and country first approach.
To take one sector in particular, one vital for the British economy, aviation is worth £57 billion to the British economy. The UK, through our membership of the European Union, has led the debates on liberalisation. We have led, not followed, and the regulations that apply have in many respects been designed by the United Kingdom, using the European Union as a platform for the world. When I was born, there were 400 million air passengers in 1974; in 2016, there were 3.7 billion. To ensure safety and efficiency in this complex web of regulations, it is very worrying that the Government do not have today a clear position on the EU-US Air Transport Agreement.
We do not need to forecast or repeat assertions; we can simply look at the record of the Government since the referendum. There are the red lines which were set which are now being blurred. There was the comment from the Foreign Secretary that the European Union could go whistle rather than demand the £39 billion to which we have agreed. The UK said that we would start the talks only if we could negotiate the new relationship at the same time as the withdrawal agreement, which we have now gone back on. We have said that we will follow all the single market rules during the transition period, and that we will seek to adhere to European rules on medicines, aviation and financial regulation. Those strong Brexiteers have been critical of all those areas.
Our relationship with the European Union will not be healed by this process. Sometimes, the relationship between the UK and Europe has reflected what our former colleague, Earl Russell, described as the relationship between England and Scotland:
“England could brook no equal, and Scotland no superior”.
Our relationship with Europe is not the same as other countries’ relationship with Europe, but our process now will not heal the wounds in the Conservative Party.
However, I am more concerned about healing the wounds of those who were disfranchised in the referendum —the 16 and 17 year-olds who will have to live with the consequences longer than any other. They did not have their say. I hope that they will have their say. Those who will be living with the consequences need to have a voice.
I have quoted Scott before:
“Faces that have charmed us the most escape us the soonest”.
That was present with many of the promises from those for Brexit. They said, “Let the people decide”. When it comes to whether the withdrawal agreement is in the best interests of those who will live with its consequences, I feel I have to say, “Let the people agree”.
Lord Lisvane (CB)
My Lords, it is no exaggeration to say that if the Bill before us is enacted without significant amendment, it will represent the largest single peacetime transfer of power from Parliament to the Executive. By comparison, the 1972 Act was a model of restraint.
This is not what we were led to believe in the referendum campaign by the use of phrases such as “parliamentary sovereignty” coupled with “taking back control”. The leave/remain and soft/hard/no deal debate no doubt continues unabated, but that is not where criticism of the Bill should lie. The Constitution Committee has done an excellent job on the Bill. In passing, I gently observe, in the distinguished presence of the chairman of the committee, that some of its recommendations are a little less exacting than those of the Delegated Powers Committee, of which I am a member and which I expect to produce another report in time for the start of Committee.
The issue here is parliamentary sovereignty in the making of law, which the Bill challenges and will constrain—and, not least in the power to make tertiary legislation, not only constrain but extinguish. No one doubts that flexibility and speed will be needed to adapt our legal order to life after Brexit, but it cannot be at the expense of the power of Parliament to scrutinise and decide.
As one or two noble Lords have alluded to, it is worth remembering that once extensive ministerial powers are on the statute book, they can be used by any Minister of the Crown. Her Majesty’s present Ministers may not welcome the thought, but were the powers they now propose to be in the hands of an Administration of a different political colour, I fancy there would be a great deal of traffic down the legislative road to Damascus. It is important to keep in mind that assurances about how powers are intended to be used are of limited value. The only thing that matters is what is on the statute book.
The Bill will, no doubt, be heavily amended by your Lordships’ House. Issues of real concern include the looming presence of a largely unconstrained Henry VIII. Although Henry VIII has become a convenient shorthand for the exercise of ministerial powers which erode parliamentary sovereignty, the dangers of the other delegated powers in the Bill are just as serious. I pay tribute to the speech of my noble friend Lord Wilson of Dinton. There is the Bill’s substitution of ministerial judgment of what is “appropriate” for what is “necessary”, allowing major changes of policy to be made under a power intended, we are told, to make purely technical adjustments to the repatriated legal order.
There is the ability of Ministers to confer on bodies and even individuals the power to make law—tertiary legislation—without the approval of Parliament or even the requirement to publish that law. There is the fact that the superficially reassuring sunsetting provisions do not apply to substantial areas of ministerial power. There is the ability of Ministers, not Parliament, to decide the level of parliamentary approval required for the exercise of many of their delegated powers. There is the ability to impose taxation by statutory instrument, not primary legislation.
The mechanics of approving a final deal will no doubt be an issue, despite the extreme difficulties of timing involved, alluded to by the noble Lord, Lord Hamilton of Epsom. In a parliamentary system of government, I am no friend of referendums, and I recall Attlee’s excoriating criticism of them, which was quoted by Margaret Thatcher, as the noble Lord, Lord Patten of Barnes, recalled. I am genuinely torn. I have sympathy with the noble Lord, Lord Adonis, in not understanding why, when it is all right to ask the people once, it is not all right to ask them again—not the same question, of course, but to see whether they are content with what has been achieved in their name.
Indulge me for a moment, my Lords. It is as though I have three elderly and extremely nervous aunts of whom I am very fond. I decide to give them a treat and ask them to discuss what they would like to do. They have a discussion and arrive at a democratic solution, which is that they would like to go to the cinema tomorrow. I look in the local paper and discover that the only films on offer are “Reservoir Dogs” and “The Texas Chainsaw Massacre”. What am I going to say to my highly nervous—indeed, squeamish—but much-loved aunts: “You must stick with your democratic decision”? Or do I say, “Now you know what’s on offer, what do you think?”?
Of course, on all these matters, in the end, the elected House must have its way. That is a given, but I would not be surprised, especially in the context of the numbers in the Commons, to see extended exchanges between the two Houses. After all, it was not that long ago that the then Corporate Manslaughter and Corporate Homicide Bill went back and forth between the two Houses seven times. That was an important issue, but it was nothing like as important as the issues now before us. Some argue against any criticism or amendment of this Bill on the grounds that if the Bill were not enacted there would be legal chaos. That is a naive and slightly condescending argument. We all know there need to be mechanisms to move us towards a post-Brexit legal order and, suitably amended, this Bill would provide those mechanisms, but without doing profound damage to the authority of Parliament and its duty to act as a check on the Executive. Of course, there are those who see such criticism or amendment as an attempt to stop Brexit. It is not. It is about what we have after Brexit; it is about parliamentary sovereignty and the long-term constitutional settlement.
Lord Selsdon (Con)
My Lords, I find myself in a very difficult position. I have been in your Lordships’ House for 56 years and I have never found such an impressive audience at this time of the evening. I am therefore wondering why I am here, and what I might be able to do to help. I was asked to say something on the financing of trade as we need to develop it across the world. I was, for quite a while, chairman of the British Exporters Association. Most of my life has been the financing of trade, usually against good orders. As we sit here tonight, with Britain in Europe at the moment, 37% of service exports and 48% of goods exports go from here to the continent of Europe. That is more than I thought, and £380 billion UK imports are from Europe, compared with only £243 billion from the rest of the world. Some 2.9 million EU citizens live in the UK, 1.2 million UK nationals live in the EU and 40% of foreign direct investment comes from the EU.
So what is our duty as Britain in Europe? What can our Government do to help? We know that through the financial institutions and through our export associations, the finance is normally available for all worthwhile projects. We know too that, for the first time in many years, the relationship between the departments of trade and industry and other departments is pretty good. One can pick up the phone, ring and, instead of being passed to someone else, get instant help. What can we do at this time?
We have people worrying about the continent of Europe and what will happen. Yet we have a significant position within all aspects of trade. Money is only a commodity these days—it is a method of communication. This is the first time in my banking years that I find when you pick up the phone and ask if someone might be interested in something, the voice at the other end of the phone jumps down the line and says, “Yes, I would be”. In financing the development of trade and overseas investment, there appears to be no shortage of money. There is no difficulty in currency and, although to some extent in the past, language created problems, it seems that the spread of the English language on the telephone is greater than it is in real life; you get a wonderful response.
I feel confident that we are in a strong position. The questions are: who is in charge and what are we trying to do? I am not sure who is in charge at the moment. This place in the evening, when you have 700 or 800 people, is quite an interesting environment in which to get tired. I do not think the Government or Parliament can do much more to help. If anyone has any ideas, I would like to open up your Lordships’ House for a debate on a particular subject with questions that noble Lords might like to pose. I could certainly arrange for them to be answered. That is probably the best contribution I can make, other than to give you an order for anything for which you would like an order.
Lord Davies of Stamford (Lab)
My Lords, my view is that Brexit is a real and present danger to the prosperity of the country, to future public services, given the likelihood that tax revenues will not be as high as they otherwise would be, to our influence in the world, to the stability of Europe and, not least, to the personal opportunities open to our people now and in future generations. I feel it is my patriotic duty in these circumstances to do anything I can to assist in the avoidance of that calamity, but I recognise that if the worst occurs, we will need something along the lines of this Bill—or hopefully a good deal better—to avoid a legal vacuum.
The Government have been strongly criticised on both sides of the House in this debate, and quite rightly so. I intend to continue the criticism. They have committed four major, and quite unforgivable, errors. The first is to have been less than straight with the British public about the costs of Brexit, particularly its economic costs; that has been the story of the last 36 hours —their disgraceful attempts to prevent the public learning about the impact assessments. The public have had to pay for those impact assessments; they deserve to see them, and directly from their Government, not indirectly by way of leaks. The whole episode has been quite disgraceful.
Over the last few months, the Government have been coping by quoting historic figures on the economy, apparently showing the economy coping well in the face of problems raised by Members of this House about the present and future prospects of the economy. There was a good example of that just a couple of weeks ago when the noble Lord, Lord Callanan, answered a question of mine about people planning to leave the City of London and go elsewhere in the European Union to pursue their careers. That is an issue relating to the future, which he answered by talking about current of employment levels in this country, which is a lagging indicator of the performance of the economy until now. He would not get many marks in an economics exam if he mixed up leading and lagging indicators. I do not know if it was incompetence on the part of the noble Lord; I think it was part of this general campaign by the Government to throw dust in people’s eyes and prevent them realising what is going on.
This neglect of the economy—plus a certain amount of self-deception—has also led the Government to make the very worst call they could in selecting a form of Brexit that will be the most economically damaging to the country, a form in which we are excluded from the single market and from the customs union. I was shocked yesterday when the noble Lord, Lord Callanan—I am sorry that I keep referring to him—blamed the British public for that, saying they had decided it. They decided nothing of the kind. There was nothing on the referendum ballot paper about the single market or the customs union. The single market was very little mentioned in the campaign and was often mentioned on the Brexit side by people such as Daniel Hannan, who were trying to encourage people to vote for Brexit to get a Norway or EEA-type solution. The British public can hardly be blamed for that. I never heard the customs union mentioned in the whole campaign. As for the Irish border issue, the only time I heard that mentioned was when I mentioned it myself at a big public debate at the Mansion House in the City. I completely floored my opponent because he had not even thought of the problem. Such was the extent to which the British public had an opportunity to make a judgment on this. The Government cannot get away with blaming the people for the consequences of their own decisions. Parliament must not allow them to get away with it, and I trust that we will not do so.
The political judgment of the Government has been about as bad as their economic judgment. They started these negotiations with an enormous degree of naivety and over-confidence. Perhaps they really believed you can have your cake and eat it, too. Perhaps they believed, as Mr Gove said, that the day we left all the cards would be in our hands. They have behaved as though they believed those naive things. They thought the big German exporting companies—Siemens, BMW and so forth—would say to the German Government, “You have to make concessions, you have to keep the British Government happy”, and the German Government would say, “Yes of course, we’ll do that”, and go to the Commission. Of course, none of that happened. They very recently thought the continentals would panic, go to the Irish, bully them and say, “We cannot take on your problems, you are only 3 million people and you can’t stand in the way of tens or hundreds of millions of people; you must give up your insistence on the Irish border”. They failed in both cases to understand the concept of solidarity in the European Union. The Eurosceptics in this House have never understood the European idea—not since we joined the European Union—so they were very surprised. They had made a complete miscalculation and were very surprised by the reactions they got.
The worst thing about the Government’s attitude to all this is surely the order of priorities—moral priorities, if you like—reflected in their actions so far in this field. Those values have resulted in a most bizarre situation. We have a lot in this country that we should really be very concerned about. The National Health Service is in crisis. There are people literally dying on trolleys hours after they have been admitted to hospital, without ever being seen by a nurse or a doctor. That is a disgrace for all of us in a civilised society. We have had defence cuts which are, in my view, quite irresponsible, and are of the greatest concern to anybody who has taken any interest in defence at any point, professionally or otherwise. The Government are now planning further defence cuts, we are authoritatively told. They have cut the police, disastrously, so that clearly the police are not capable of responding to threats, particularly in areas such as terrorism, cybercrime and the serious crime of rape, as we have seen in recent sad cases. Against that background, what are the Government doing? They are spending money hiring 5,000 customs officers. Can you imagine going to a patient who has been waiting on a trolley for hours and hours, perhaps in serious pain, and telling them, “I’m sorry there’s no doctor or nurse to look after you, but don’t worry—the Government are hiring customs officers”?
Then there is the ultimate obscenity: the Government’s plans to spend £1 billion building a vast lorry park by the sea at Dover to accommodate lorries for hours and hours on end, a monstrous project that will contribute absolutely nothing, not an iota, to economic output or prosperity of the country or to human happiness, and which will of course detract from both.
We must be pitied in many parts of the world to be in this situation, and I fear that in many parts of the world people may be laughing at us and the mess that we have made of ourselves. It is a situation that none of us can be happy about, and it seems to me absolutely our duty to do everything possible to try to make sure that we get out of this terrible mess as soon as possible.
Lord Russell of Liverpool (CB)
My Lords, to help orient the Minister both socially and geographically, may I explain that I speak as a hereditary oik of the Cross-Bench variety? I wish to make two points very briefly, one on the rather fevered political climate and its effect, good or bad, on this Bill’s passage, and secondly, and perhaps rather more importantly, on the need to protect the rights of children.
First, people largely ignored party politics when they voted in the referendum, as is evidenced by the state of our two largest political parties today, and we should do the same in doing our best to improve this Bill. Undoing 43 years of legal, regulatory and commercial entanglement within the highly compressed post-Article 50 timescale was always going to be difficult, particularly as it was triggered from, effectively, a standing start, as the noble Lord, Lord Bridges, powerfully reminded us. In its passage through another place, frankly—I went and observed some of the proceedings—it was often quite painful. It was overtly political, and sometimes it was needlessly puerile. We can and we must do better in this place, and I appeal to all noble Lords, especially the 30% of our number who in a previous incarnation were in another place, to try hard to leave their perfectly formed or partially formed bad habits behind them. I make one exception: the rather splendid speech of the noble Lord, Lord Patten. With friends like that, the Conservative Party has really no need of any political enemies.
So let us do our job properly as a constitutional Chamber, not as a bickering group of partisan factions. We have seen some very good examples today of noble Lords from all sides of the House demonstrating that this is indeed possible. I thought the noble Baroness the Leader of the Opposition was extremely balanced in what she said, and I thank her for that. I thought the right reverend Prelate the Bishop of Leeds was extremely thoughtful, and reminded us that there is a lot more out in the world that is rather more important than the details of some of the clauses we will be going through. Then there was the noble Lord, Lord Bridges, as well as my noble friends Lord Lisvane and Lord Krebs, who I thought made a very powerful personal statement, our Convenor, my noble and learned friend Lord Hope of Craighead, the noble Lord, Lord Higgins, who skewered the idea of referenda extremely effectively, and the noble Lord, Lord Wilson of Dinton. This is what we need more of. We have also heard one or two contributions which frankly, in my view, we need rather less of.
Before I move on to children, I state my interest on the register as the trustee of the charity Coram. As the noble Baronesses, Lady Massey, Lady Hamwee and Lady Lister, and others have mentioned, the Joint Committee on Human Rights report on this Bill has flagged up major concerns about excluding the European Charter of Fundamental Rights from our domestic law, stating that it will create uncertainty and a lack of clarity. The Government assured Members in another place that their ability to support and safeguard children’s rights will not be affected, but I have a question for the Minister. In the light of the concerns from the Joint Committee on Human Rights, are he and the Government committed to working together to ensure that there is no erosion whatever of children’s rights and entitlements after exit day?
I give notice that some of us will table amendments, particularly to Clause 7, and I hope we can work together to get the best results for children, rather than do so in needless opposition.
Lord Ribeiro (Con)
My Lords, much has already been said by our legal Peers and others on the legalities and technical aspects of this Bill, so I shall focus on just two areas this evening. One is the European working time directive and the other is the Euratom treaty. The European working time directive was introduced to ensure that workers such as truck drivers did not work excessively and fall asleep at the wheel, causing accidents. Introduced in 2004 for doctors in training, it coincided with my period as president of the Royal College of Surgeons, from 2005 to 2008. We published several publications, and there were publications from the speciality associations for trainees in surgery. They noted the negative effects of the directive on the quality and continuity of care given to patients, and on the quality of the training provided for our junior doctors. The impact of the European working time directive on medical graduates in 2002 was surveyed in 2013 and 2014 and reported in the journal of the Royal Society of Medicine. More than 3,000 doctors were surveyed and 64% responded, which is quite high. More than two-thirds of doctors believe that the directive has had a negative effect on the continuity of care and on junior doctors’ training—no change from the surveys that we carried out during my presidency. The majority disagreed that it benefited the NHS but noticed an improvement in doctors’ work-life balance. Surgeons, unsurprisingly, were the least positive about the directive. This was also true for the other craft specialties.
Ten years on and little has changed. Even Norway, to which we often liken ourselves in Brexit terms, adheres to the 48-hour working week but has experienced problems with surgery and believes that a degree of flexibility is required for that speciality. The change from being on call while residents in a hospital to shift-working has not reduced fatigue or made for happier doctors. Even the BMA, a champion of the European working time directive, accepts that fatigue is still a problem. Add to this the loss of the firm structure, with three junior doctors working together in a team providing moral support to each other, whereas we now have one doctor working in isolation, often for 13 hours at a stretch at night, for four nights in a row with very little in the way of support and nowhere to lie down or have a kip because he is there to work. That is what is happening. We have moved from an on-call situation, where people could rest and then carry on working, to one where they are expected to work all the time. It is hardly surprising that it has had an effect on junior doctor morale. My plea to the Minister is that we do not adopt the EWTD in its present form but seek to ensure flexibility for those who practise craft specialties, who have to acquire not only knowledge but demonstrate the ability to carry out surgical and other operative procedures.
What are the implications of the UK leaving the Euratom treaty? The EU Home Affairs Committee on which I sit took evidence from medical specialists on the risks of leaving Euratom. I am mindful that 80% of the radioisotopes we use for diagnostic and treatment purposes are imported from outside the UK, the majority from the EU, but also from Australia, South Africa and the United States. These materials have a half-life and decay over time. Their transportation is therefore time critical. Euratom is a major contributor to the Horizon 2020 project and the UK benefits by some £32 million for nuclear research, much of which is utilised by our universities. I have concerns for our research industry if the UK leaves Euratom. I therefore ask my noble friend the Minister: what plans do the Government have to set a timetable for replacing the provisions of the Euratom treaty with alternative arrangements? What assurances can the Government provide that our access to radioisotopes will not be compromised by our withdrawal from the EU?
Lord Morris of Handsworth (Lab)
My Lords, this is a unique debate, the first of its kind, certainly in my experience. However, we are not debating principles. The people have spoken and now we must respond. Nor are we debating timing, methodology or process because these factors, important as they are, have already been determined and, indeed, concluded in another place. Therefore, this House is primarily concerned with the execution and consequences of the decision taken by the British people to leave the European Union. It is now the duty of this House in this debate, as in the other place, to respect and deliver the will of the people.
I am very much aware that the House has had a number of debates on the decision to leave the European Union and the implication has been well examined, so I will not dwell on the particulars. Nevertheless, there is one area where the outcome amounts to success or, indeed, failure: that is the free movement of people. Therefore, my question to the Minister is: where in the thousands of pages which reflect the debate in the other place are the contingencies and the planning for exit day?
We already know that there is currently a steady stream of European returnees who feel unwanted living in a hostile environment in the UK. This is not specific to one sector or profession, north or south; already some sectors are preparing for the worst. The horticultural industry is seeking workers to replace those planning to leave. The NHS is planning for the worst as the European NHS workers start to go home, and this is also true in agriculture, construction and social care, among other sectors. I trust for all our sakes that the planning process to fill the gap is well advanced. When the Minister responds to the debate, will he tell the House where is the contingency plan to sustain economic stability? When will it be developed and implemented?
By the end of the debate I hope that we will be clearer about many of the issues which worry many of our fellow citizens whose lives will be affected whether they voted to leave or to stay. The way people voted does not devalue questions about, for example, animal welfare, food additives or joining or leaving the single market. The debate was much more parochial and was influenced by populism in respect of the yes or no vote. I have a great many questions, far too many to consider in these few minutes. However, what guarantees will there be as regards maintaining and enhancing workers’ rights so that they do not fall behind the rights of workers across the EU? An amendment in the other place required that after Brexit any change to employment rights and protections for consumers and the environment would require primary legislation and proper scrutiny by Parliament. It was narrowly defeated by the Government.
Regulations covered by the European Social Charter, including drivers’ hours and the working time directive protected not only workers but the health and safety of us all. Why would the Government reject proper scrutiny? Similarly, the Government have argued that we will no longer enjoy, or be protected by, the jurisdiction of the European Court of Justice. What will replace the jurisdiction of the ECJ? The proposals set out in the European Union (Withdrawal) Bill will require UK courts to interpret legislation passed before Brexit in line with EU law and European Court of Justice judgments, but there are uncertainties in relation to the way this will be interpreted in future. Will the Minister consider that point and calm our worries?
In many rural areas, farmers had difficulty last year in finding people to pick their fruit and vegetables. Even workers who had regularly travelled from Europe for this seasonal work chose instead to stay in Europe, where the environment was more hospitable. Many employers have difficulty finding local people with the willingness and skills to do certain work, including, as I have indicated, the NHS, care services and hospitality. Am I alone in feeling there is too relaxed an attitude to this problem, not just in our Government but in many communities and sectors of our economy?
Finally there is the problem of the continuing use of UK and EU citizens as bargaining chips. It is affecting every industry and shattering the lives of thousands. The application process, which we are told will settle this problem, clearly will only make matters worse. Migration experts warn that hundreds of thousands of EU nationals living in Britain could struggle to secure Home Office permission to stay in the UK after Brexit. Already, applicants for citizenship are being turned away by the Home Office—
Lord Young of Cookham (Con)
Noble Lords have been very good about observing the advisory limit of six minutes. I urge the noble Lord to pay similar respect to the time limit.
Lord Morris of Handsworth
I accept the noble Lord’s comments and will wind up.
In view of the points already made, British workers will not return to the status of poor relations. They will defend the working time directive, the drivers’ hours regulation and the social charter. As with all major challenges, there is no turning back. As a nation, we have made our bed, and there we must lie.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I share the views expressed by many other noble Lords that this is at root an enabling Bill—albeit one with serious and complex constitutional and societal implications, as the noble Lord, Lord Lisvane, reminded us in his excellent speech a few minutes ago. However, its overarching purpose is to give effect to the wish of the British people to leave the European Union as expressed in the referendum, and it therefore has my support. I come to this debate as what can best be described as a “mild Brexiteer”. I am afraid that I cannot support the more extravagant claims of triumph or disaster espoused by many who have more convinced and settled views. Indeed, I wonder about what lies ahead with artificial intelligence and robotics and their impact on this country and our whole way of life. That impact may be so great that the effect of Brexit may pale by comparison.
My approach to the “European project”, as I understand people like to call it, has changed over the years, from an initial great enthusiasm at the time of this country’s entry into what was then called the European Economic Community. These views were based on personal experiences, and mine were based on the fact that I was born during the war. By the time I was born my father was already in khaki, on a troop-ship bound for the Far East. He returned unharmed, and I first met him when I was about four and a half years old. I am sure that my mother was concerned and worried—although she kept this from me—and I had friends whose fathers had been killed or wounded. So I need no lectures from noble Lords about the death and destruction that Europe has wrought upon itself twice in the last century. However, I have a growing sense that the project has lost touch with the views, hopes, fears and aspirations of a great many of those it sought to represent.
The Explanatory Notes, on page 6, summarise the four main functions of the Bill. I will focus my remarks on the third of these: the power to make secondary legislation—delegated powers. That is not because the other functions are not extremely important and do not require intensive scrutiny—they certainly do, as many speakers referred to earlier—but because to me, the sharp end is where mission creep may occur, and where the temptation of a power grab may prove irresistible. I do so against the background of the experience I gained as a member for some years of your Lordships’ Secondary Legislation Scrutiny Committee, under the able chairmanship of my noble friend Lord Trefgarne.
Focusing on Clause 7 and its associated sections, one has to recognise on the one hand the complexity and magnitude of the task that will be undertaken, and on the other the extraordinarily wide powers that are sought. So there is a balance to be struck, which was very well illuminated in the speech of my noble friend Lord Bridges of Headley. In her excellent opening speech earlier today, my noble friend the Leader of the House explained some of the steps in the development of the Government’s thinking as to how we will tackle the challenge of this balance. We are to have a scrutiny committee—although its membership has yet to be determined. I am also not yet clear whether it will address issues surrounding tertiary as well as secondary legislation—and if it does not, what body will? Further, is its purpose solely to decide which legislative route a particular regulation will follow—negative, affirmative or whatever—or will it undertake the scrutiny as well?
As to the make-up of the committee, I have no doubt from my time as a member of my noble friend Lord Trefgarne’s committee that the quality of examination we were able to give a particular regulation was greatly enhanced by the presence on the committee of people with direct experience of that particular policy area. For example, knowing something about trade and industry I could contribute on that, but when dealing with social security I needed other members of the committee to bring their particular expertise to bear. So I hope that, as the Government’s thinking develops, consideration will be given to establishing a series of scrutiny or standing committees. One alone will surely not be able to do a serious job on the volume of legislation that lies ahead of us. Each of these would focus on defined policy areas and would contain some members with relevant experience of those subjects.
One of the major weaknesses of the whole procedure for scrutinising secondary legislation is that such legislation is unamendable. Your Lordships’ House is therefore always faced with what can best be described as a nuclear option—and, given that fact, has unsurprisingly proved reluctant to press the button. We face exceptional circumstances in this Bill. Is there not a case for establishing a special one-off procedure to deal with them? I note that in paragraph 57 of its report last September, and indeed in the report it published yesterday, the Constitution Committee of your Lordships’ House hints at the desirability of such a development.
Finally, in order to clarify what has been proposed and focus our discussions appropriately in Committee, would it be possible to produce some sort of flow chart showing how, when and by whom decisions are made, as well as the checks and balances built into the procedure, and fit that in to a parliamentary timetable? Maybe such a chart exists—but I have not seen it and it would be most helpful to have one before Committee.
To conclude, this important Bill has my support, but we have to work to do to examine it in detail. I hope that filibusterers on either side of the argument will stay at home—this House’s reputation is at stake and this Bill is too important for the playing of games.
Lord Hoyle (Lab)
My Lords, as my noble friend Lord Morris of Handsworth said, this debate is not about whether we leave. That decision has already been taken. It is a decision of which I personally approve, but it is right that there is a discussion and that questions are asked as to where we go from here. I am also very pleased—the media has got it wrong—that there has been no suggestion from any noble Lord that the House could overturn a democratic decision of the British people.
There are two sides to this. We very often concentrate, as I have said in previous speeches, on the jobs that are created in this country by Europe. I want to look also at the benefits that we afford Europe, because those are quite substantial. Europe has a £40 billion to £80 billion trade surplus with us, so we are a very important market. Indeed, Germany alone has a trade surplus of £25 billion to £26 billion, and a fifth of German car exports come to this country. The point is that it is in Europe’s interests as well as ours to reach an agreement on these matters. If we look at it from that point of view we will see that we are just as important to Europe as it is to us, and that is the basis on which to conduct negotiations.
I also want to emphasise that workers’ rights need to be enshrined or looked at again. It is very important, as has been mentioned several times, that they are safeguarded. The other thing I want to discuss is the position of Gibraltar. It is only due to the intervention of Europe that Gibraltar’s frontiers are kept open, and consequently it is extremely concerned about what may happen. I hope that the Minister can reassure us that Gibraltar’s position is being looked at and discussed. The Chief Minister of Gibraltar expressed concern the other day in relation to this matter and it is very important that we take Gibraltar along with us.
I have been very impressed with the nature of the debate. Everyone who has spoken has tried to be constructive in stating their position. This is one of the most important decisions this country has to make. Going forward, I want us to have a debate with Europe on equal terms where we get together and make progress. I see no reason why we cannot do that. A lot of good could come from going forward in a harmonious fashion rather than being at loggerheads with each other—there is no need for that.
I have really enjoyed listening to what noble Lords have had to say today. This has been a very important debate and I think that, having listened to all the points of view, we will all go away looking at the matter in a different way. I look forward to moving on to the next stage.
Lord Norton of Louth (Con)
My Lords, it is crucial that we do not make the mistake that we made during the passage of the European Union Referendum Bill—that is, spend time debating the merits or otherwise of withdrawing from the European Union at the expense of focusing on the specifics of the Bill. We took our eye off the ball in dealing with that Bill, and we are in no position to complain about the rules and process of the 2016 referendum.
We need to be clear as to purpose. I endorse what the noble and learned Lord, Lord Hope of Craighead, said this afternoon. We cease to be a member of the European Union on 29 March next year whether or not we pass this measure. This Bill is necessary, although not sufficient. I have no problem with the end; we need to make sure that the means are there to ensure that it delivers what it is designed to do. As it stands, it goes much of the way to achieving it—some provisions are to be welcomed—but more needs to be done.
I serve on the Constitution Committee of your Lordships’ House. As the noble Baroness, Lady Taylor of Bolton, has already explained, our report, to which several noble Lords have already referred, identifies the key problems with the Bill and what can be done—indeed, what needs to be done—to render it constitutionally acceptable.
The Bill creates confusion for the courts and indeed is constitutionally flawed in the breadth given to the novel category of “retained EU law”. The category includes primary legislation that, by virtue of inclusion, becomes subject to the power of amendment in Clause 7. Even if primary legislation is excluded, the powers conferred by Clause 7 privilege Ministers to an unacceptable degree.
The power to make changes as Ministers deem “appropriate” is subjective and inappropriate. It is also inappropriate for the Henry VIII provisions in the Bill to be exercisable by the negative resolution procedure. The limited set of circumstances for which affirmative resolutions are required is too narrowly drawn. The power conferred on Ministers under Clause 17 has, in the context of the Bill, the capacity for broader application than is the case with other measures and, as we note in our report, there are minimal restrictions on the use of that power.
The “supremacy principle” that the Bill seeks to retain is imprecise in terms of scope. As the committee’s report stresses, it constitutes a fundamental flaw at the heart of the Bill and is alien to the UK constitutional system. In the words of the report:
“It has meaning and application only in relation to EU law, and to seek to graft that EU law principle onto a legislative scheme whose explicit purpose is to remove EU law from the UK legal system and replace it with domestic law risks confusion and places legal certainty in jeopardy. It does not make sense, either as a matter of language or as a matter of constitutional principle”.
What, then, do we propose? Retained direct EU law should be designated as domestic primary legislation. That would remove the need for a supremacy principle. We consider that there is merit in drawing on recent amendments made by the Government to the Sanctions and Anti-Money Laundering Bill to ensure that Ministers demonstrate that there are “good reasons” for any change and show that the use of the power is a “reasonable course of action”. We also recommend that the Explanatory Memorandum should include confirmation by the Minister that regulations do no more than make technical changes to retained EU law in order for it to work following our departure from the EU and that no policy decisions are being made. The consequential provisions power in Clause 17 should be removed.
We make other proposals, not least in relation to devolution. In essence, the Bill needs to be amended to strengthen the position of Parliament, to provide certainty for the courts and to meet the concerns of the devolved Administrations. We simply cannot afford to get this wrong. Those who have argued against Brexit today are not necessarily doing their cause or this House any favours. They are diverting us from our core task—the task that alone now falls to us: to scrutinise thoroughly and forensically the provisions of this Bill. We must not allow ourselves to be diverted.
I look forward to my noble friend Lord Callanan indicating willingness on the part of the Government to move forward on the amendments proposed in the report of the Constitution Committee. This time, we must not take our eye off the ball.
Lord Morris of Aberavon (Lab)
My Lords, it is always a pleasure to follow the noble Lord, Lord Norton, whose views on the law are treated with the utmost respect in this House. I will follow him in one respect: on the legal consequences of Clause 11, which is important to the devolved Governments in Scotland and Wales.
I will confine my remarks to that particular clause, which I believe is sufficiently contentious for me to make a fundamental objection to it on Second Reading. The Scottish Secretary made a commitment on behalf of the Government that it would be amended by the Report stage in the Commons. The Government have failed to do so. It would have been of enormous value to this House if that promise had been kept. Is it that Whitehall cannot get round to facing the fact that more than 20 years after the event, there are other legally constituted Governments in other parts of the United Kingdom in addition to Westminster?
Mr Stephen Crabb, the former Welsh Secretary—he understands devolution—let the cat out of the bag when it was reported that he addressed the Conservative Party conference last year and said:
“We still have to get the Cabinet Secretary to put pressure on departmental permanent secretaries to take devolution seriously”.
I want to say in passing that with devolution, surprisingly, the involvement of Wales in decision-making in Brussels seems to have been less, not more. When I was Welsh Secretary, I frequently attended the Agricultural Council of Ministers when Welsh agriculture was discussed. On one occasion, at the Prime Minister’s request, I chaired the Employment and Social Affairs Committee during our presidency. The big question is whether Clause 11 undermines the principle and practice of devolution now accepted after years of battling.
The Government have been accused of a Westminster power grab in the Bill, at the expense of the devolved Administrations. Such colourful language may not be justified, but the question remains of how the present proposals were put before Parliament without meaningful discussions first taking place with both devolved Administrations. The explanation may lie with the intermittent and sporadic meetings of the Joint Ministerial Committee, where proposals could have been hammered out and agreed. If I may spell out what I understand to be the legal position, as it stands, there would be a new restriction on the legislative and executive competence of the devolved institutions—a new set of shackles whereby they cannot change retained EU law. So, instead of the devolution settlement, where there is equality between the devolved institutions and the UK Government in terms of freedom to set policy in devolved policy areas within the EU framework, there would exist a situation where the UK Government can unilaterally lock down the devolved institutions’ opportunities to shape such policies.
I believe that the Bill, as it stands, fundamentally redraws the architecture of devolution—the architecture referred to by the noble and learned Lord, Lord Wallace of Tankerness. In my view, and that of the Welsh Government, the principle of effective equality between the UK Government and the devolved institutions in areas that are clearly devolved needs to be retained in the post-Brexit world.
Astonishingly, the Bill would give Ministers of the Crown powers to make rectifications of retained law in areas of devolved competence without consultation with the devolved institutions to reach over into areas of devolved competence. The granting of powers to a Westminster Minister to change an Act of a devolved institution without any input from those legislatures is totally unacceptable.
I now turn to the issue of legislative consent, which of course is a political convention only, as the Miller case commented. The Government have come exceedingly reluctantly to the need for legislative consent. It has had to be dragged out of them. On 21 June, the Prime Minister stated:
“There is a possibility that a legislative consent motion may be required by the Scottish Parliament”.—[Official Report, Commons, 21/6/17; col. 62.]
The Leader of the Commons the following day kicked it into touch. Confirmation had to be dragged out of the Government and I am grateful to the noble Lord, Lord Bourne, who said that we would be seeking consent from the three devolved bodies. The issue is of such serious constitutional importance that the two First Ministers of Scotland and Wales have sent a joint letter to the Government stating that neither the Scottish Parliament nor the Welsh Assembly would give legislative consent that the Government acknowledge is needed to the Bill in its present form. That letter, which the two Governments have sent, is very important. Hence, there is an urgency for getting back to the table for meaningful discussions. As I have said on previous occasions, once devolution is given, it cannot be taken back.
Lord Carrington of Fulham (Con)
My Lords, I am delighted to welcome the Bill. After the debate that we have had today and the many interventions, I may be among a small minority in doing that. The Bill is not without its problems, as we have just heard from the noble and learned Lord, Lord Morris, but it is one that we can all welcome because it brings a degree of confidence in terms of what is happening in our leaving of the European Union. Business needs the certainty that the Bill starts to bring to where we will end up after the end of the negotiations.
We can all agree that, in leaving the EU, we wish to do so with as little disruption as possible. Perhaps the Bill is an important part of that, although a fairly small part. It is clear that both the other 27 members of the EU and ourselves will prosper from a mutually beneficial exit agreement. I hope that the Bill will strengthen our hand in our negotiations in persuading the other 27 that there is no point in a punishment-beating type of exit, and bring both sides to a grown-up recognition that it is in everyone’s interests for trade to carry on very much as it does now. There is one area where that is more of a problem than for physical exports, and that is for services—particularly financial services and the related support services such as the legal and accountancy professions. We need to be clear on the way forward for these important industries.
It matters very little whether financial services benefit from what is called passporting, which is likely to end on our departure from the EU, or from mutual recognition of the EU’s and UK’s regulatory regimes—what is sometimes, and rather controversially, called regulatory equivalence. They both give reciprocal market access, enabling EU firms to continue trading services in the UK and UK firms to continue trading in the EU. Both passporting and mutual recognition come to the same thing in broad terms and are both to the advantage of the providers of the services and to the client.
Under either system, a bank operating out of London providing services to a French client, say, will benefit from not having to create artificial structures such as setting up a subsidiary in Paris with staff and capital to channel the French client’s financial and trading needs through to London or New York. Equally, the French client will benefit from reduced costs in meeting their banking needs. After all someone, inevitably the client, will pay for the additional costs of setting up artificial structures. The client will also benefit from the increased competition, and therefore lower costs, of having the maximum number of banks prepared to offer global services in France.
The real cost of erecting artificial barriers to the trade in services will be met by an additional group of people. It is not just the client at the bank who will lose out; it will also be damaging to the employees of the bank. If banks are required to open subsidiaries in Paris, say, which they would not otherwise have done, the staff who would be transferred there would predominantly be French staff currently working in London and servicing French clients. There is a good reason we have so many EU nationals working in financial services in London. Part is due to lifestyle and part is due to our still-benign personal tax regime, but it is principally because, if you work in financial services and are ambitious, there are only two cities in which to build your career: one is New York and the other is London. I know very few EU nationals working in financial services in London who would see it as a good career move to return to their home countries.
The need for easy access to the financial markets of the other 27 countries after we leave varies greatly from one financial institution to another. Some, such as insurance companies and brokers, have always operated from subsidiaries and will continue to. Many banks already have subsidiaries, which enable them to meet any regulatory requirements with, perhaps, a little tweaking of their capital structures. Asset managers tend to operate offshore in any case and sell their products on the basis of their performance. While the financial service industry will continue to prosper regardless of any changes to our relationship with the EU, there are many things we can do to make that more certain and a lot cheaper. I hope that, when we come to consider this Bill in detail, we will be able to explore ways to make the transition for the financial services industry seamless.
Lord Roberts of Llandudno (LD)
My Lords, first, can I say how much we welcome the words of the noble and learned Lord, Lord Morris of Aberavon? I am sure that, in Wales, people will have been listening very carefully to what he said. My emphasis will again be on Wales and in a different context.
We need to confirm Brexit or otherwise, and we do that by voting. We voted in the referendum. People will say that we had one vote—that the people voted and made their voices heard—but it is unusual for people to rely on just one referendum. In Wales, we had a referendum on Welsh devolution way back in 1979, when 20% of the people of Wales voted for devolution. Some years later, just over 50% voted for it, but people had changed substantially in those years. People are allowed to change their minds. If they do not, they are like stagnant water that is not fit to drink.
Let us look at other things that have happened in Wales. In 1961, we had the first referendum to open pubs on Sundays. As a Methodist minister I was not in favour and the people were not in favour. Nine local authorities voted to stay dry. Eight local authorities voted to open, so it was just over 50%. The next election on this came seven years later, and another two or three voted to open. We came to the last vote, which was the sixth referendum. This was in 1996 and then the whole of Wales voted to open.
People change their minds, very substantially. People are allowed to change their minds. Of course they are. What is this House but a place where we change what has been decided by the House of Commons? If we do not change our minds then it is hardly worth our sitting here. Of course, today we do not penalise people because they change their minds. In the Middle Ages if someone changed from one faith to another, that was the end of that person. Some areas of the world today have that total opposition to people changing their minds. Let us not be embarrassed at all. Let the people change their minds. Let them think. If we do not want them to think, we are doing something very dangerous. So I say, yes, we need another decision. The people voted in a referendum, 48:52, to come out of the European Union. There is no threshold there, only a majority, but it is said, “People have voted”. Is it not reputable for us as a House to say, yes, we have confidence that, having explained the details, the people will be able to take a rational decision—a rational decision very necessary at this time?
How will coming out of Europe affect us? We are in a world where we have North Korea, a President of the United States whom I do not understand most of the time, and Putin in Russia. These are dangerous people and if we opt out of a stable relationship with a Europe that has the confidence of the members who belong to it, are we not really saying that we as a UK have no confidence; that we are content to be a backwater? We are not a backwater. Over the centuries we have had a distinctive position. Now we come out of Europe, we weaken Europe and we weaken ourselves.
Therefore I suggest briefly: do not be afraid of changing your mind or having a second vote. That first vote was only one vote. Also I want to say, and others have said it this evening too, that young people aged 16 and over should be allowed a vote in any referendum. It is their future. I and most noble Lords have done our best in the past but these youngsters have the future and they have to shape that future. Wales has already decided. Today, in the Assembly in Cardiff they are going to vote to give youngsters the vote at 16. Do not let England be far behind Wales and Scotland.
Lord Framlingham (Con)
My Lords, it is a pleasure to follow the noble Lord, Lord Roberts, although I fear I am going to disagree with him on pretty well every point he raised.
Although I am very cross about what has happened since we voted to leave the EU, I speak today more in sorrow than in anger. I am deeply saddened that not only has the decision of the British people been betrayed but that a golden opportunity to forge a new course for our country has been deliberately spoiled, muddled and fudged. Although it may be obvious from my remarks, I am not going to tell the House how I voted in the referendum. Once that was over, it should not have mattered. Every effort of everyone should have been devoted to getting on with the task of making a success of our new role in the world. What has dismayed and frustrated me more than anything is the number of people who never wanted us to leave the EU and who, under the pretence of wanting to improve the legislation, have sought to sabotage it and thwart the will of the people. They should have been honest from the start.
Now, at least, some of them are coming out into the open. Many, however, are still being duplicitous—playing a double game. This debate is not about whether we leave but about how we leave: it is not whether, it is how. I can do no better in setting out the context of this debate than to quote from the totally reliable, completely unbiased House of Lords Library briefing for this debate. It says that the Bill will provide for the repeal of the European Communities Act 1972 and convert EU law at the moment of the UK’s withdrawal from the EU into domestic law, as a category of law called “retained EU law”. It also provides for retained EU law to be modified to correct deficiencies that may have arisen as a result of withdrawal. It is as simple as that. In the simplest terms, we are transferring all EU law into our own, and giving the Government the power to tidy up where necessary, subject to appropriate scrutiny. What could be more straightforward?
All great issues are essentially very simple. We make them complicated when we do not want to face them. Those who do not want us to leave the EU are deliberately muddying the water, complicating arguments and doing everything they can to prevent us leaving. They have already done great damage to our programme for leaving, they have given succour to our opponents and now they are in danger of urging your Lordships’ House, careless of its reputation, to further impede progress.
Even at this late stage, I say again, in sadness rather than anger, that I sincerely hope that they have a change of heart, and that if they feel they cannot help they will at least refrain from hindering. This should be a national team effort to get the best result for our country. It is very hard to win if half the team want you to lose and are working to that end.
The impression is sometimes given that the British people are half-hearted about leaving—are changing their minds. Nothing could be further from the truth. The vast majority of the people just want us to get on with it and are tired of all the infighting and backbiting. What should have been one of the most exciting events in our history has become a total turn-off for so many people.
Finally, I hope that we can stop talking ourselves down, pass this Bill—perhaps with some sensible modifications—and get on, with the help of our friends and allies throughout the world, including the Commonwealth, with seizing the opportunities that our new-found freedom will present.
Lord Triesman (Lab)
My Lords, despite what has just been said, it was inevitable that this Bill would arrive here with such obvious defects. Because of the ideological drive to leave at any cost and a Prime Minister who is obviously unable to contain the excesses of her Eurosceptic colleagues, we now have no declared detailed objectives other than that we do not want a fight among them. We have a Bill which is constitutionally deficient, and a Constitution Committee report, introduced by my noble friend Lady Taylor, that is clear and precise, and justifiably tough.
The Bill is deficient on the constitutional issues of granting Ministers untrammelled powers that sideline Parliament, deficient in the neglect of devolved interests and deficient on the human rights implications—and it is all tied to a timetable that is almost certainly incapable of being accomplished. The Bill will need significant amendment if it is to be made simpler and clarified, and it had better be accurate. I thank my noble friend Lady Taylor and also the noble Lord, Lord Norton, for his clarity on this point.
I cannot square the difficulty posed by the problems outlined in the debate with the complacency of Ministers in saying that they have all the aspects covered. This House will expect and welcome a positive attitude to amendments aimed at improving the Bill. Ministers ask us to trust in a bargaining process in Europe where it is plain that the two sides are not even on the same page. These are the same Ministers who will ask us to allow them Henry VIII powers at a later stage, and it is the same Ministers who conducted the referendum campaign on the basis of what I can describe only as deliberate deceit.
I complained about the overstatements on the remain side, unashamedly, and I say to your Lordships that the straightforward lies on the other side have brought our politics to a miserable low, as the right reverend Prelate the Bishop of Leeds said earlier today. We have surrendered our largest constitutional issue in modern times to hucksters and snake oil salesmen. To take these steps on the basis of a referendum conducted in that way will, I suspect, be seen historically as a form of certifiable insanity—a malady comprising crude populism and a sense of profound fantasy.
I do not really want to focus on the economic prospects post Brexit, other than to agree with my noble friend Lord Mandelson, who emphasised a possible route through the miasma: by staying in the single market and customs union while leaving the EU. It is sub-optimal but it is at least an intelligible route. I remind the House that my noble friend was also a former Northern Ireland Secretary and, like the noble Lord, Lord Patten, has grasped the profound danger of dismantling the customs union.
I mean to focus on the subject of defence, if I may, and the alliances which keep our country safe. It is fundamental; if Governments do nothing else they must do this. When we leave the EU, I have little doubt that our erstwhile partners will rate our exceptional forces very highly. They will know that they are capable and do not shrink from tasks that they are set. Even with our capacity sharply reduced by government cuts, our partners will no doubt welcome our contribution to military activity. But we will not be at the meetings or councils where the strategic decisions are discussed and decided. We will be asked to contribute without having helped to decide the objectives. We may try to find ways to take part in discussions—and we should—but, as the noble Lord, Lord Hague, told the European Union External Affairs Sub-Committee, we will have no rights in those forums.
I know with certainty that the United Kingdom will not commit its forces if it cannot share in shaping their objectives. That would be an absurd position for any state to take. When I am told that NATO will fill the gaps—I am completely committed to that alliance—I am not confident. American commitment is at best half-hearted. It is not only what President Trump says, which is bad enough, but the septic pool of populism from which his policies have emerged and which will greatly outlast him. The United States is more isolationist and nationalistic than for a long time, and there is small reason to feel that we have compensating alliances and doctrines. Indeed, the things he has said suggest to me that the underpinning values of NATO are themselves at risk.
At the level of military leadership, we seem ready to give up the positions we have traditionally held, including Deputy Supreme Allied Commander Europe, which was ably filled for many years by General Sir Adrian Bradshaw. My noble friend Lord Robertson, the former Secretary-General of NATO, has asked how a non-EU country can hold that position. It is a good question. We have elected to be marginal and, inevitably, weaker. I hope that the deepening relationship with France and some other countries may partly compensate, but our decline seems obvious and unacceptable. We have not thought it through.
Finally, in starting this process David Cameron turned our country inward. I doubt that I will be reconciled to the noble Lord, Lord Framlingham, for example, or to any other zealots for leave, because they want a very different country from the one that I want—and I doubt that they will ever be reconciled to views such as mine. In short, our differences may be resolved if some middle way is found but it is entirely possible that they will never be resolved, at least in a generation. The right reverend Prelate the Bishop of Leeds put this eloquently today. The ugliness of the debate, the name calling and the lies have all demeaned the United Kingdom. I am afraid that I see a country with deeper xenophobia and more unashamed hate crime than I have ever seen in my lifetime, and with a view of people from other countries which should shame us—and it is getting worse.
Two generations ago, two ladies in my family left Paris, where my family had lived for generations. That was in 1932. Their letters showed that they thought that the French would never resist the Germans when they inevitably advanced on France and that French anti-Semitism would find a terrifying ally. Other members of the family thought that they were mad. Paris? Amazing city. What could possibly go wrong? Well, they left in 1933, and the two of them—and two others who spent the war hiding in Paris’s sewers—survived. The rest of the family went to the extermination camps. For the first time in my life, I know a number of people who are asking the question: when the economy goes pear-shaped and the bogus promises are seen to be the frauds that they have always been, what will happen then, and who will be blamed? How will we avoid repeating some of the mistakes of European history that occur in these circumstances? Their bet will be that the same people historically will be blamed in Europe. Like the Paris relatives, sadly they are beginning to make their plans to leave when it becomes sensible, and in advance of a catastrophe. They are not the familiar lot who plan to leave because a tax increase is rumoured, and do not tell them it cannot happen to them, because it has happened—in our lifetimes and to our families.
If there are serious solutions to taking on crimes and attitudes of prejudice, let us see them, not just hear words about them. Nothing about this outcome is inevitable. But there is a requirement for confidence that people take it seriously and are prepared to confront it and deal with it. If they are not, I fear that the consequences will be as I have rehearsed.
The noble Lord, Lord Newby, in a fine speech at the beginning of these proceedings, said that it was not a reform Bill but a dreadfully incoherent transfer Bill. I remind noble Lords that the football transfer window closes at 11 pm tomorrow—about the same time as we will close. Let us hope that Ministers can tell us how Team UK can answer the problems set out in this debate rather better than the authorities in football clubs. No bland assurances—
Baroness D'Souza (CB)
My Lords, clearly there are many hundreds of occasions, set out in the Bill, when delegated legislation is, and should be, acceptable—for example, to remove rights that become redundant after Brexit, such as the right to participate in European elections. Furthermore, the Government face a herculean task in transposing EU law into UK domestic law, and the use of delegated legislation serves the interests of expediency and is not necessarily malign in intent.
That said, the mantra that accompanies the Bill is that it is an enabling mechanism, not a decision-making one. The purpose, we are told, is practical and not policy-oriented. But here I have to disagree with my noble and learned friend Lord Brown of Eaton-under-Heywood and agree rather more closely with the noble Baroness, Lady Lister of Burtersett, in the expression of her concerns. We are told that the Government have excluded the European Charter of Fundamental Rights from the Bill. This exclusion conflicts with the general rule of maintaining the status quo and represents a weakening of human rights protection for UK citizens. Furthermore, it represents a major policy change, something the Government explicitly make clear they do not wish to do by avowing that,
“the same rules and laws will apply after exit as on the day before”.
What does the charter add to the armoury of human rights protection enjoyed currently by UK citizens? The charter is at present part of our domestic law but will not be so after Brexit. It gives UK courts the right to strike down any legislation that infringes charter rights as set out in the general principles of EU law. As such, it is an important tool, affecting rights to education, bioethics, academic freedom, conscientious objection, a fair hearing and an effective remedy, among other rights. The charter also covers digital and asylum rights and pension rights for LGBT people, and it safeguards maternity rights.
The charter has been used in recent years to challenge indiscriminate bulk collection of personal data, and/or by those employed by foreign London-based embassies to ensure fair job treatment and to protect privacy from government intrusion. Crucially, it has been used to ensure that the Government cannot make decisions balancing individual rights and national security in secret. The key feature of the Bill is that it removes the right of challenge in the UK courts for breach of the general principles of EU law. There is no counterpart legislation in UK law to deal with these challenges. So while we are busy transposing EU law into British law, we will wholly bypass the European Charter of Fundamental Rights and it is therefore legitimate to question why.
The Government argue that there is no need for the charter since “all” the rights contained within it are already covered by other legislation including, for example, the UK commitment to the European Convention on Human Rights and the Human Rights Act 1998. However, I remind noble Lords that the Government have also, at other times, expressed the contrary view that the charter adds an extra layer of rights domestically, which is perhaps something they now consider undesirable. While it is the case that similar charter rights are covered in the ECHR and domestic law, there are, as already mentioned, very important omissions.
The Government assert that while every other EU law will be retained, they single out the charter for exclusion, and we are therefore justified in asking them to demonstrate how, where and when there will be legislation to protect the full panoply of rights. It is interesting to note that the opt-out of the charter in the Bill is in marked contrast to the specific safeguards granted, for example, for the use of delegated legislation in relation to taxation and to amendments to the Human Rights Act.
On Report in the other place, the Secretary of State said,
“it is true that after exit it will not be possible for an individual to bring a free-standing claim or for the courts to quash an administrative action or disapply legislation on the grounds that it breaks one or more of the general principles of European law”.—[Official Report, Commons, 11/9/17; col. 585.]
It is difficult not to see this as anything but a pretty major policy change. If the Government wish to revise their human rights protection policies, which they have every right to do, perhaps the withdrawal Bill is not the best place to do it. Such major policy changes should come before both Houses of Parliament in the normal way and be open to detailed scrutiny and amendment. This is a matter of great importance and not one to be roughly pushed aside in the context of the withdrawal Bill.
Finally, the law has to be clear. People must know their rights and, most especially, when and how they might be threatened and what redress is open to them. As was said in the other place:
“The whole point of the charter was to gather all the rights and protections that existed … in other places and put them into one document”.—[Official Report, Commons, 17/1/18; col. 1006.]
Now they are to be once again scattered, weakened and made less accessible. We should retain the charter within the Bill, together with a commitment that Government will not use their delegated powers to weaken substantive human rights and equalities protections by losing the mechanism to enforce those that we currently enjoy from Europe.
Lord Suri (Con)
My Lords, I was a remainer and now I am in favour of Brexit. This is not due to a fundamental shift in my economic thinking. I still hold many of my original opinions, and I think our economy will take a hit with Brexit, although the predictions made before the vote to leave were quite ridiculous and damaged the integrity of many institutions. The reason I have changed my mind is simple. I am a democrat, the people voted and we must, in this and the other place, execute that vote.
Although there was no direct outline that people voted for, we can reasonably say that two things are true. The first is that voters want us to have the power to make our own trade deals. The second is that voters want control of our borders. The second point is far more important, as it has been a running sore of our body politic for at least a decade. To end freedom of movement and regain control, we must leave the single market. This is not a choice that the electorate will accept a fudge on. Nothing less than full control of our borders will do.
The EU will not make a special deal on migration for us, as the shadow Chancellor and some Labour Front-Benchers insist. Michel Barnier, Jean-Claude Juncker, Merkel, Macron and Tusk all agree that the four freedoms are inseparable. This is their prerogative. They wish to preserve the trade-offs that exist in the single market, and it will be their legacy. But to suggest they will change now, when they had the chance to during the former Prime Minister’s renegotiation, is clearly false.
The question of what happens on the island of Ireland is a vexed one. I believe two tests must hold. There must not be a border between the north and the mainland, but there must also be a smooth and frictionless border on the whole island. It may well be the case that the UK opts in to some EU rules to meet this goal. It may well be the case that the whole of the UK ends up following them to avoid internal borders. I see no issue with this. People voted to take back control, and politicians making decisions to keep the union together of their own choice is firmly consistent with that principle. Peace in Ireland is not ours to endanger, and we must make sure to keep it.
It is rare that we in this House should seek to amend such an important piece of legislation. This has been voted on by the people. It has been voted for by the other place, which is elected. It has passed with a majority and it now comes to us. I am of the opinion that if changes ought to be made, the legislators who are in actual contact with public opinion should make them. Brexit remains the biggest issue of my political life, bar perhaps our initial joining and the Falklands War. I would not have been expecting to be involved in those issues were I in this place then. I will not now. If we begin to meddle in affairs decided by the voters, then we cannot hope much for our future as a Chamber. Many will speak today about the need to change the Bill, but I beg noble Lords to ask themselves this question: what mandate do I have?
Lord Kirkhope of Harrogate (Con)
My Lords, I seek to avoid being described as a remoaner so, with your forbearance, I shall instead indulge myself in a little nostalgia.
I do not understand why we seem unable to comprehend that ever since we joined the then European Economic Community, the UK has been a leading player in the reform and expansion of a free, democratic Europe. Our success in changing things has never been properly regarded in this country, or properly exploited. Far from losing influence, we have been wielding it year after year, treaty after treaty, process after process. This power has been executed by successive United Kingdom Governments, aided by our growing influence in the European institutions as they have developed. In the Commission—noble Lords have served as Commissioners—our representation has put great energy into its respective roles. In the Parliament, where I spent the past 17 years, UK MEPs, with one or two notable exceptions, have provided and still provide the democratic input to make and improve European laws for our benefit. When I went to the European Parliament in 1999, Europe was made up of 15 states, and the French language was often the default. Over the next 10 years, as new states joined, the preferred default language became English, and with that came more of the English way in procedures and methods. We failed to capitalise on that, to our enormous discredit.
The single market that now seems so terrible to some of our harder Brexit friends was driven through by Margaret Thatcher and Lord Cockfield. The enlargement of Europe to welcome the states emerging from all the years of dictatorship that they and their peoples had endured was again driven by us—driven by us, my Lords. Lately, the close working of our security services and police, including Europol, a service run by a Brit and on good, proven UK lines, has allowed us to defend British interests in a way that isolation and so-called independence would never allow.
When David Cameron asked our EU partners for some further reforms ahead of the referendum, he got promises which were substantial, not, as some said here, minimal. I know that because I was there, talking to European colleagues. The UK was again in the lead, pushing for reforms which, if they had been implemented, would have shown not only the progress in Europe that was desirable for all but, more importantly, would have endorsed and confirmed our leading role for the 21st century.
It is clear that too many colleagues, especially in the other place, are frozen in an earlier era. They demonstrated some ignorance during the referendum campaign when they presented to the populace an image of Europe that was long gone—a Europe that existed before Margaret Thatcher and David Cameron, and a Europe that ceased to exist as UK influence increased.
One further matter: we talk about the will of the people in the referendum. I have recently been reading some general election manifestos of both major parties before they entered government. Time does not permit me to list the major promises they made, but the list of promises not met when the realities of government presented themselves is numerous. Changes of direction have been common, especially when either the aims became undeliverable when the facts were known, or because, by implementing the policy, the people of the UK would have been harmed, or at least would end up worse off. The Government present a future full of challenges and opportunities, and not a single noble Lord or noble Baroness would balk at having challenges or opportunities but, for the population as a whole, that bravado may not always strike the positive note that the Government intend.
I refer briefly to the amendment moved by the noble Lord, Lord Adonis. The question of a second referendum keeps coming up. I have to state quite clearly that I do not think a second referendum is a sensible approach. That is because the elected House of Commons and its Members, whose names are well known and whose political views on the subject of EU withdrawal are or will be well known, carry the full responsibility for the decisions they take—not the Executive, who supposedly act on the decisions taken in Parliament, but those MPs, who have a grave duty to act in the interests of their constituents and to do them no harm. That must continue. We will see whether they do their duty, because if they get this wrong, they will pay the inevitable price of democracy—a heavy price in some cases.
Once the terms of our withdrawal become clear, it is the duty of the elected House to reflect on whether those terms give us the opportunities that the Government speak of or whether, in implementing them, it is consigning our citizens to long-term decline.
Lord Truscott (Ind Lab)
My Lords, the noble Lord, Lord Triesman, mentioned the importance of security issues. It is also true that, in withdrawing from the EU, as outlined in the Bill before us, we will be withdrawing from the European Union’s common security and defence policy and its common foreign and security policy. These were issues that preoccupied the European Parliament when I was an MEP years ago.
I wish to focus on the issue of British foreign policy post Brexit. I fear that, as we speak, the Foreign and Commonwealth Office is not prepared for Britain’s place in the world post Brexit and does not currently have a foreign policy fit for purpose. There will be a new reality for the UK post Brexit—a world where we need to forge closer political and trade relations with a whole host of partners, some of whom we may not particularly like or even trust. If we are to thrive as a nation, we will need to be pragmatic in our approach. Being pragmatic does not mean we will have to abandon our principles as a democratic country committed to free trade and human rights—several noble Lords mentioned the importance of human rights in the charter. However, it does mean that we will need to develop a more coherent, sophisticated approach to foreign and international affairs—an approach that is painfully absent today.
Frankly, Britain’s current foreign policy is incoherent, contradictory, hypocritical and short-sighted. The UK imposes financial sanctions on more than 20 countries, but sells arms to its ally, Saudi Arabia, which, in Yemen, is helping to cause the greatest humanitarian disaster on the planet today. Saudi-backed military intervention and bombing has led to 2.2 million people being forced to abandon their homes; half the population does not have food and a quarter faces starvation. Until recently, the war in Yemen was one of the most underreported in modern history. Why is that? Could it have something to do with Saudi Arabia’s role as a strategic British ally, trading partner and source of oil? Where is Britain’s moral leadership in Yemen?
Under former Prime Minister Cameron and Chancellor George Osbourne, the Government’s main trade and foreign policy seemed to consist of selling as much of the country as possible to the People’s Republic of China. I note that David Cameron is continuing with this approach in his private capacity as vice-chairman of the £750 million UK-China fund. I welcome foreign direct investment from China as much as anyone, but we should be under no illusions about Beijing’s aims. China has already bought up large swathes of Africa, and it wants to do the same in Europe, including in the UK.
If it cannot buy up our high-tech industries, it is not above trying to penetrate them through covert means. Some 800,000 Chinese are working on cyber in the PRC, many in the People’s Liberation Army and state sectors. The belt and road initiative is designed to extend China’s geopolitical reach, with 900 planned projects and $4 trillion of investment, encompassing about 60 countries. In the meantime, Beijing continues to extend its sphere of influence in the East and South China Seas. Here in the UK, China is a partner in building the extremely expensive Hinkley Point C nuclear power station and wants to build a nuclear plant in Bradwell. If it succeeds in doing so, the UK can forget any notion of energy security.
In the new world order post Brexit, the UK will have to think through its policies more than it does at present. We should, perhaps, question whether making the President of the United States feel unwelcome in London is sensible, whatever one thinks of Donald Trump. The US is our most important ally, vital for inward investment and trade. It is our largest single export market and second-largest import partner. The US is also the UK’s largest single inward investor. Post Brexit, we will need America more than ever. Where possible, we should use the much-vaunted special relationship to influence US policy. We do not need to defer to Washington every single time—for example, in my view, it was a mistake to follow the US into Iraq, which destabilised the entire Middle East and far beyond. Nor should we ever agree with the US over the Paris climate accord and its withdrawal—something that EU member states have stood together to resist to date.
New thinking will be required. Perhaps, for example, the UK should join the Trans-Pacific Partnership Agreement, which is opening up closer trade with the emerging economies of the Asia Pacific region. Of course we will need a close and continuing relationship with continental Europe—and the closer the better in my view. The relationship should encompass not only trade but security, tackling crime and protecting our shared environment. We are leaving the EU but we remain both British and European. In doing so, our foreign policy needs to be thoroughly thought through, with a new sense of purpose and direction.
Baroness Pidding (Con)
My Lords, regardless of which side we supported in the referendum, in listening to the debate today it is clear that we all recognise that our departure from the European Union will be one of the biggest challenges faced by any British Government in modern times. I believe that the health not just of our economy but of our democracy rests on implementing the referendum result and making a success of Brexit. The Government have successfully brought this Bill before us with very few amendments. I know that many noble Lords have strong personal convictions about the EU, but it would be wrong for this unelected Chamber to oppose or attempt to subvert the democratic will of the Government and the people. The other place voted 6:1 to hold a referendum and, in June’s general election, the two main parties took more than 80% of the vote on manifestos that promised to implement the result.
As many noble Lords have said today, it is also important to recognise that this is not a decision-making piece of legislation. Britain’s departure from the EU has already been decided; it was decided when Parliament put the decision in the hands of the people. Nor is this debate about our future relationship with Brussels, which is being negotiated by the Government. Under the operation of Article 50, we shall be leaving the EU in 2019, with or without this Bill in place. We are here to consider and scrutinise what is fundamentally a piece of enabling legislation, which will empower Ministers to implement the country’s decision while offering maximum certainty to our importing and exporting businesses and their European counterparts.
There are undoubtedly many benefits to European co-operation, but membership of an increasingly ill-fitting Union cannot be the only way for us to work together with France, Germany and our other continental partners. The EU’s share of the world economy has roughly halved since we first joined in 1973, despite the addition of many more member states. I believe that Brexit offers us a valuable opportunity to build new relationships with emerging markets in Asia, South America and Africa, markets brimming with the people and skills who will shape this century.
But I recognise that in some cases the referendum result has opened, or at least exposed, some deep divisions in our politics and, yes, in society too. We have a responsibility to deliver a Brexit not just for the 52% who voted leave, but which respects the needs and concerns of those who voted remain, especially those who have built businesses, created jobs and generated prosperity by trading with Europe. This Bill does that: it empowers Ministers to provide a smooth legal transition away from the structures of the EU, and adapt to the inevitable uncertainties of the Brexit process, while offering the maximum possible continuity to British businesses as the Government negotiate our future relationship with Europe.
This Bill is crucial to delivering an orderly and successful Brexit, and I urge this House to heed the example of the other place and speed its passage to the statute book.
Baroness Murphy (CB)
My Lords, I wish that I could agree with the noble Baroness, Lady Pidding. She occupies a wonderful nirvana to which we are all heading following this Bill—but I fear that I do not share her view.
I confess that my original thinking on this Bill was to deny it a Second Reading, since voting on the Bill would end up with headlines in the Sun, the Express and the Telegraph saying, “House of Lords votes to support EU withdrawal Bill”, and there would be no more explanation than that—and that is indeed what will happen. However, I have reluctantly come to the conclusion that that may not be a sensible approach. The noble Lords, Lord Norton of Louth and Lord Framlingham, want us poor remainers to shut up and get on with it and not take up the House’s time during the Bill’s passage. However, this is a Second Reading debate. We will have an awful lot of time in Committee to get to grips with the difficulties of the Bill, which need to be addressed whether you are a remainer or a leaver. I am definitely a remainer and I hope very much that the Bill will eventually contain clauses which will give the public an opportunity to have another think at the end of this process. I am not sure whether that will be in the form of a referendum. I am not keen on referendums—I would not be, would I?—but certainly we need a way of allowing the people of this country to change their minds once they understand what this process really means.
I wish that members of the Government would stop squabbling among themselves over their aim. The referendum gave no clues about what the public think the Bill should contain. Anyway, they are not interested in this kind of a Bill. However, it is about time that the Government had some notion of what we will face in a year’s time. Every minute they spend talking about Brexit, concentrating on it and talking about the divisions between the different factions in the party, they are not addressing the real issues that this country faces such as the failing education system and a hospital system which is failing to work because we have destroyed community care, primary care and social services care. We are failing to provide adequate housing and wages are disgraceful, with working families having to depend on benefits to survive. If those issues had been addressed earlier, we might not have had a referendum and voted to leave the EU.
I am persuaded that a technical Bill of this kind is certainly required, if and when we leave the EU, to avoid the legal hiatus and total uncertainty that would otherwise occur. However, the Bill goes far beyond its obvious original purpose and is drafted in such a way as to deprive Parliament of any sovereignty over much primary legislation. There are some crucial elements such as those contained in the Charter of Fundamental Rights. I am deeply suspicious about why they cannot be transferred. If we want them, why should they not be? I hope that we will take the time to consider what they mean.
I was a bit shocked by the comments of the noble Lord, Lord Ribeiro, on the European working time directive, having worked 48 hours on the trot when I was a junior doctor. The European working time directive has been excellent for our health service. It has changed the culture and the way that consultant doctors treat their juniors. I know that it has been difficult for surgeons in particular, but I do not want it repealed.
The referendum may have established that the majority want to leave the EU, but I still think there must be ways to rethink what we want at the end of the process. I will listen to the proceedings on the Bill with great interest. I will support many of the amendments that seek to make the Bill one we can be proud of, and one which, if we must leave the EU, at least translates into our legislation the good things that the EU has done for us. However, I very much regret that it is necessary to do this.
Baroness Wheatcroft (Con)
My Lords, this House knows what is expected of it. I trust that we will not cower at the lurid threats of tumbrils at the gate voiced by my noble novelist friend Lord Dobbs. We have a duty to perform, summarised on Parliament’s own website, which declares our role to be:
“Checking and shaping draft laws and challenging the work of Government”.
As many noble Lords have already said today, in this instance the work of government really needs challenging.
The Bill is not merely the “cut and paste” of EU law that it has been portrayed as. It changes the balance of power between the UK Parliament and the devolved Administrations; it confers sweeping, wildly undemocratic power on Ministers; and, in Clause 9, it makes provision for “implementing the withdrawal agreement”. Given its implications, we would be failing the country if we did not challenge the Bill’s imperfections. To let fear for our own future prevent us would be self-interested cowardice, not constitutional propriety. My noble friend Lord Dobbs quoted Sir Winston Churchill; two can play at that game. I remind the House that it was Churchill who said that our task was,
“to re-create the European Family, or as much of it as we can, and provide it with a structure under which it can dwell in peace, in safety and in freedom”.
We risk throwing away his legacy.
We are told that the Bill brings business the certainty it craves. It does not. It gives no clarity on where the country is headed after Brexit. Business is clear that it wants to remain in the single market and the customs union. Here I declare my interests as listed in the register. Business knows what the Government are failing to tell the country but BuzzFeed helpfully did this morning: under any scenario other than staying in the single market and the customs union, coming out of the EU will make Britain significantly poorer. As others have said today, Britain did not vote for that.
By the Government’s own reckoning, there are 132,000 companies in the UK that export only to the EU. Far from being the bureaucratic nightmare we keep hearing about, the single market actually works. We will pay a high price for leaving. The Government could assure business now that they are intent on preserving the benign trading environment we enjoy for goods and the all-important services—the arrangement that has produced such prosperity. Instead, all we are promised is a transition deal—but to what? We leave the EU to enter limbo land, while we try to hammer out a deal with no negotiating power. We stride out on to what my noble friend Lord Bridges called,
“a gangplank into thin air”.
Parliament needs to be told, and soon, just what the Government are aiming to achieve, and in terms much more specific than the “deep and special relationship” we hear so much about. That is what we have now. Hope does not equate to policy. To extend the Article 50 process while we negotiate a deal, rather than walking off that gangplank, might be a great deal more sensible.
Ministers must also scrape away the fudge that was so liberally ladled over the issue of Ireland. My noble friend Lord Empey accepts that the issue is “difficult”, albeit he thinks those difficulties minor. But I can see no way of providing Ireland with the borderless, frictionless trade that has been promised other than the UK remaining in the single market and the customs union. If the Minister has found one, perhaps he could spell it out. To a simple soul like me, trade between an EU member state and the independent UK cannot continue post Brexit without a border. Again, hope does not equate to a policy. We need details.
Finally, I join with those who believe that before this country takes the momentous step of leaving the EU, it may be that the people will need to have their say on the terms that are on offer. Opinion polls already show that a significant majority favour such a vote. While I share the view of my noble friend Lord Patten of Barnes that referenda should be avoided, I suspect that if a referendum got you into this mess, the only way out may be another referendum. This may not be the Bill which mandates such a vote, but the time may well come when it is inevitable. The government position seems to be that we have made our bed and we will jolly well lie in it; no matter how uncomfortable this turns out to be, we must get on with it. I find that somewhat perverse, and I suspect the majority of voters would too: let us find a better bed.
Lord Winston (Lab)
My Lords, as the noble Baroness, Lady O’Neill of Bengarve, said, this is a technical Bill. But, as the right reverend Prelate the Bishop of Leeds and my noble friend Lord Davies so ably pointed out, it has human consequences. We cannot escape these consequences, which are massive, and I want to dwell on them briefly.
When Ministers talk of science, they talk about and quote Nobel Prize winners and great scientists. However, when perhaps the greatest scientist of the last century, Albert Einstein, died, within seven hours his brain was taken out of his head, cut into small bits by a pathologist, looked at under a microscope and put in a jar marked “Pickles”. Subsequently, a lady pathologist at Stanford University, miles away from where Einstein had died in New Jersey, had another look at his brain. After excessive dissection, she decided that there was no difference between his and anyone else’s: it had a 100 billion neurons and each was connected in the usual way to 5,000 to 10,000 other neurons. There is a message here, which is rather well explained by my two noble friends on the Front Bench: put together, they have more brain capacity than Albert Einstein—I exclude the Whips and, of course, the Front Bench on the opposite side.
The fact of the matter is that our best innovations and attempts at becoming human come through collaboration and co-operation. This has been said repeatedly in this debate but it is often forgotten; increasingly, it is the key to Europe. Do not forget that for a long time we have stood at the head of science in this country. I genuinely believe, and I think there is evidence to support the belief, that this will slip away. Other European countries are starting to overtake us and we are being left behind. The economy, which has been so important to the Government, must be considered as well.
I want to explain the consequences for one scientist I have come across who is not from my university but from University College London. I left the Chamber to print out his email to me just 10 minutes ago as what he says is a revelation about how many European scientists feel, though he represents far more people than just scientists. He says that he is married to an Englishwoman and has two children, but does not want to take British nationality. Why should he, when he is Italian? He feels totally insecure. This professor—his name, which he has said I can use, is Professor Andrea Sella—wakes up at night with cold sweats worrying about his position in Europe. He says that this is common among many of his friends and I see this at Imperial College as well. He describes what he feels so amazingly that I want to read it to noble Lords. He says:
“The government keeps claiming that in regard to EU nationals all is settled. Yet it remains completely unclear what rights we will have in the UK after the UK leaves the EU. We’ve paid our taxes for decades but everything is uncertain. What is our access to healthcare? What about other services?”.
He goes on to ask about elderly parents who live overseas who may need care and who may wish to come to this country for that care, with their children’s help. He says he had always assumed that people might be able to bring their elderly parents over but now he is not so certain. He talks about the 3 million people who can apply for citizenship but points out that the Home Office is completely overwhelmed—that passports are missing for months on end and that in the past people have had to fill out an 85-page document, which adds to the complication. Of course, this becomes completely impossible for many people to manage.
He goes on to say something rather sad:
“Just a few days ago David Davis sat in front of Hilary Benn’s parliamentary select committee and waffled about our ‘anxiety, real or imagined’. What planet does he live on?”.
That is a really serious issue. There is an aspect of unreality about how this affects so many people whom we regard as our friends and colleagues and who contribute massively.
I shall tell your Lordships about Andrea Sella. This man is a leading chemist in this country—a professor. He regularly goes into schools and has probably spoken to around 100,000 schoolchildren in the United Kingdom over the last five or seven years. I have seen his activities—they are immense and purely charitable. There are very many scientists like him who help with our civilisation, and what is happening is a real risk.
He ends his email on a very poignant note. Perhaps in saying this, I could point out that I watched the noble Lord, Lord Callanan, shake his head when he heard my noble friend Lord Triesman speak. At the end of his email Andrea Sella talks about a maternal ancestor. He is not Jewish but his ancestor was. Apparently she called him early in the morning when the result of the referendum became clear. She said, her voice choking with emotion:
“How can these people forget so soon where nationalism leads you?”.
I must tell the noble Lord, Lord Callanan, that, amazingly, a number of Jewish people are now applying for German citizenship, so perhaps he will understand that some of us feel a bit offended when he talks about the House of Lords in the way that he apparently did—if what my noble friend Lord Adonis said is true. I hope that, when he comes to sum up at the end of this debate tomorrow evening, he will put the record straight and point out that these human issues are really important—and really important to us in the House of Lords.
Lord Burnett (LD)
My Lords, it is a great pleasure for me to follow the noble Lord, Lord Winston. He has a wealth of knowledge and experience. Furthermore, he made a moving and compelling speech, and the Minister would do well to listen to it and heed his words and those of the noble Lord, Lord Triesman.
I draw attention to my entries in the register of Members’ interests.
I agree with much of what has been said so far in relation to the unsatisfactory nature of parts of the Bill—especially the sweeping powers that it would, in its current form, give Ministers. I also believe that, for the reasons I shall give, the British people should have the opportunity to give their opinion on the terms of Britain’s withdrawal from the European Union.
Many people were extremely confused at the time of the referendum and no one can now say that at that time they could gauge or foresee the conditions, let alone the consequences, of leaving. That is hardly surprising because the Government, with only 14 months to go, seem to have no idea exactly what form of Brexit they are aiming for. As other noble Lords have observed, the Government cannot even agree between themselves a negotiating position.
Other noble Lords have mentioned that there is a very high level of concern in the country about whether we are going to crash out in 14 months’ time with no arrangements agreed with our European partners. The opinion polls are moving against leaving and are strongly moving in favour of the public having the final say once the terms are agreed. It is not difficult to understand why there is this profound concern and worry.
As the noble Baroness, Lady Wheatcroft, said, people are aware that the Governor of the Bank of England has said that the referendum vote has already cost the United Kingdom £20 billion in forgone GDP. This will continue at a higher level if we leave the EU, depending on the terms, if any, that are finally agreed with our EU partners. This dwarfs the net £165 million per week that the UK actually pays the EU, allowing for the rebate and EU investment in the United Kingdom.
It is anticipated that the Treasury will provide impact assessments for various Brexit options, but explicitly excluded from those is the one option that would be most beneficial to the United Kingdom economy: remaining in the European Union, although perhaps a reformed one. The adverse impact of the decision to leave is of growing concern to everyone in the country. A factory worker in the United Kingdom providing part of an international manufacturing process will be deeply concerned about his job, post Brexit, if there are tariffs and customs checks on goods that move in and out of Britain during the manufacturing process.
In any event, we will have to comply with EU regulations and conditions for the work done with other EU countries. Those in the agricultural and horticultural industries are uncertain as to whether they will be able to continue to hire people from Europe to cultivate and harvest crops. There is deep concern that if a trade deal with the United States is eventually negotiated, agriculture and horticulture will be another industry that will be sacrificed, allowing produce to be imported with far lower standards of husbandry and subject to the use of growth promoters and other processes that are currently forbidden. These products will flood into the country and undermine the value of livestock, cereals and other crops.
Some 60% of those who work in the hospitality industry in London—and 40% outside London—come from other EU countries. What arrangements will be available to the hospitality industry to allow this to continue? The same profound concerns are mirrored in the National Health Service and the care and education sectors. As we have heard from noble Lords, there is deep concern that a mechanism must be made available for Northern Ireland and the Republic of Ireland to continue to have the same access as now. Perhaps the Minister will tell us how that will happen without membership of the single market and customs union. Finally, what about the 80% of our economy that is the service sector? Will we continue to have passporting rights into Europe? The French President stated recently that the only way that can be achieved is by staying in the single market and the customs union.
When Article 50 was triggered, we started a journey. We still have no idea of the destination. Neither do the Government. People are unable to gauge the effect that this will have on them and their livelihoods. There is an unseemly rush to leave the EU before the public know the final destination. On the matter of sovereignty, when, or if, we leave the EU—the largest trading bloc in the world—and start to negotiate a deal with the United States, we will have nowhere else to run. The United States negotiators will be extremely tough. They are there, as they always have been, to put America first. Every other country puts its interests first. We will then find out exactly what it means to be a vassal state.
The Duke of Wellington (Con)
My Lords, at the end of a long day, I am sure we will all be brief. I will try to be so. I will restrict myself to commenting only on the provisions of the Bill. As always, I must declare my European interests, as detailed in the register, and add that I was an MEP for 10 years in the 1980s.
The Bill is about how to get European law on to our statute book. It is clearly necessary for the good government of the country and, at its Second Reading, I think it should be supported. However, this House, which has so much expertise and a deserved reputation for the effectiveness of its scrutiny, must make some changes to the Bill, in my opinion. I do not accept, as has been suggested by one or two noble Lords, the idea that amending the Bill amounts in some way to obstructing Brexit. In fact, it is probable that the Government are expecting the House to make some changes, and I have some concerns.
First, as a non-lawyer, I am concerned by the very great powers that Ministers are taking to themselves to make statutory instruments in great volume and great substance. Many Members of both Houses of Parliament wish to see control pass back from Brussels to London, but surely to Parliament, not to government Ministers. There will be amendments in Committee to constrain the powers in Clauses 7 and 9 and I am minded to support those amendments.
I first learned about Henry VIII powers when I chaired a lecture at King’s College London given by the noble and learned Lord, Lord Judge. I am therefore aware of the tendency of Ministers of all parties to propose ever-increasing numbers of statutory instruments, but in this Bill it has gone too far and Parliament should restrict these powers as much as possible.
My second concern is that the Government find it necessary to amend their own Bill by inserting an exact time and date for exit day. I realise that there is a power to change this, but I favour deleting the date from the Bill altogether. The only point that matters now is that the Government should be given as much flexibility as possible to try to negotiate a satisfactory agreement and a final deal that does not damage the economy. We must all hope that the Government can formulate a coherent negotiating position and that other Ministers can refrain from making comments outside of their own responsibilities.
I have still not heard a satisfactory explanation of how we can keep a totally open border between Northern Ireland and the Republic while we leave the single market and the customs union. When the Minister replies, can he address this point? My final concern is in respect of the devolved Administrations. If the decision of the referendum was to take back control, it was surely to this Parliament and on devolved matters to the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly, when it resumes. There is a very regrettable impression given on this and other matters that the Government wish to take power back from Brussels to themselves and not to this Parliament and the devolved legislatures.
We have a duty in this House to accept the principle of the Bill, but to seek to scrutinise, amend and improve. Indeed, as our own Constitution Committee has declared and has much been quoted in this debate, the Bill as drafted is “constitutionally unacceptable”. That surely means that we have a duty to amend it. I hope that during the passage of this Bill through this House, Ministers will make concessions to ensure that Parliament indeed has more control. If that can happen, this House will have done its duty.
Baroness O'Loan (CB)
My Lords, I will speak on two issues. The first is the Secondary Legislation Scrutiny Committee, to which I belong, and the second is Northern Ireland. The Minister referred in her opening remarks to the Secondary Legislation Scrutiny Committee and to the question of the additional scrutiny that will be the responsibility of the committee. We stand ready to serve and we are reassured by the statements about enhanced membership and resources for the committee. But I cannot help wondering from whence the Government found the figure of 800 to 1,000 measures that will be necessary to deal with the fallout from withdrawal. If I look at the number of areas of intersection between EU law and UK law, I cannot believe that it will be dealt with as quickly as that. Will the Minister explain why the Government say that there will be only about 1,000 instruments? Are they sure—or even fairly sure? Can we really plan this very important work on that basis?
On Northern Ireland, we have heard at length from noble Lords from all the devolved Administrations who expressed their concern about the effect of the Bill, which is the biggest framework Bill that I have ever seen in terms of the magnitude of the instruments with which it deals. It attempts to provide mechanisms for dealing with situations that we are not yet capable of analysing with any degree of accuracy. Other noble Lords have quoted the Constitution Committee’s description of the situation as “uncharted territory”. It is particularly uncharted for Northern Ireland as we contemplate the range of policy areas and powers returning from the EU that intersect with the devolution settlement in Northern Ireland—some 141 of them, ranging from agriculture to animal welfare to consumer law, in itself a massive area, company law, environmental law, forestry, healthcare, transport procurement and so on. All these areas of law have evolved through Europe. Under the Bill they will be effectively frozen as retained European law.
Currently, devolved institutions are prevented from legislating or otherwise acting in a way that is incompatible with EU law. For the purposes of Northern Ireland, this Bill will change the law so that:
“The Assembly cannot modify, or confer power by subordinate legislation to modify, retained EU law”.
The Government have stated that powers to legislate will then be released in the manner described in the Bill. Some of these areas of activity devolved under the Welsh, Scottish and Northern Irish arrangements, such as agriculture, are governed by common frameworks, and the Government are concerned to ensure that there will continue to exist a common UK framework once the EU framework ceases to be binding.
The Government therefore propose, as the Minister for the Cabinet Office David Lidington explained at Report in the other place, that direct EU legislation that applies uniformly across the UK will be corrected, at UK level in the first instance, to avoid the risk of early unhelpful divergence in areas where it may ultimately be determined that a common approach should apply. In these areas the Bill will prevent the devolved Assemblies from legislating on matters until they are released to do so by the Government. At Third Reading in the other place, the Secretary of State said that the Government had intensified their discussions with the devolved institutions and reiterated the Government’s intention to bring forward amendments in your Lordships’ House.
The excellent briefing provided by the House Library researchers contains little reference to these issues as they affect Northern Ireland, while reporting at length on the various views expressed by the Welsh Assembly and the Scottish Parliament. That is because no views have been expressed from Northern Ireland. There can be no discussion with Northern Irish legislators because we do not have any. We have not had any for over a year. There was nobody with whom to discuss these issues since we do not have a functioning Executive and civil servants cannot act politically as Governments can. Northern Ireland has been unrepresented in effect.
Both the Welsh and Scottish Governments have expressed their total rejection of Clause 11 as drafted and called for an amended Clause 11. Both legislatures are up in arms about what is described as a “power grab” by Westminster. Through this Bill the Government will effectively be taking back powers which had previously been devolved, albeit possibly temporarily. My question is how the interests of the people of Northern Ireland, predominantly agricultural and agrifood-related, will be protected.
We have been assured that there will be no hard border. InterTradeIreland estimates that some 177,000 lorries and 250,000 vans cross the border every month for trade purposes. That is a lot of trade, carried on in 90% of cases from Northern Ireland by small companies with fewer than 50 employees. They are very vulnerable to the uncertainties of this frictionless border of which we have been assured. They are even more vulnerable to the time that may be required to make everything work after withdrawal.
I used to teach European Union commercial law and I do not understand how we can have regulatory alignment with Ireland without being regulated exactly as we are currently under EU customs law and the single market rules. If we are to be regulated in that way, effectively we must be part of the customs union and the single market. We cannot have different rules and be in regulatory alignment.
Ireland is Northern Ireland’s largest trading partner, accounting for nearly 30% of its trade in goods. It is much more complicated than that, though. Goods are produced in part on one side of the border, with further activity on the other side of the border. How many of you have drunk Baileys or bought a bottle? It is produced in Dublin, bottled about 20 miles from where I live in the north, in Mallusk, re-exported to Ireland and then exported from Dublin. During peak production up to 500,000 bottles a day are produced, according to Diageo. What happens if crossing the border becomes an issue—if duties become a problem?
The sensitivities, and the risks of the uncomfortable situation in which we have no legislature and no voice, have been recognised by the EU 27 and by the Government. Assurances have been given that we will be protected, but it is surely inevitable that the UK Government will legislate for the greater good of the UK, as opposed to that of Northern Ireland alone or Northern Ireland in its trading relationships with Ireland, with inevitable consequences. My question to the Minister is: what steps will be taken to deal with this lacuna? How will the interests of the people be taken into account when there is neither devolved government nor direct rule? When will the discussions promised in the other place take place and when will we receive the Government’s proposed amendments?
The Earl of Arran (Con)
My Lords, it is indeed late and I will be brief, but I want to talk on a topic on which there was some discussion in another place, namely the environment; not the political environment, thank goodness, but the climatic environment. At this point, I need to declare an interest in that my wife has family farming interests in Devon.
We all know that the countryside contains wonderful environmental features—waterways, meadows and forests which we all know and love. Polling by the Country Land and Business Association, of which I am a member, shows that more than eight in 10 members of the public think that the Government should spend money on preserving and managing the countryside. It is a fact that many of the rules and regulations that govern how we care for the environment and the wider countryside have their beginnings in European Union law. We must ensure, therefore, that the Bill is not used to reduce these protections. However, the UK’s exit from the European Union also represents a chance to enhance how we care for the environment and introduce policies that deliver on UK priorities, rather than focus on the needs of 28 different countries. The Government’s 25-year plan for the environment is a welcome starting point but there is much more work to be done to make these plans more specific. Much of what is proposed will require significant investment from a range of sources consistently delivered over decades, well beyond the scope of the Bill.
Key to ensuring that the UK continues to be a leader in promoting and protecting the environment post Brexit will be farmers and landowners, who frequently undertake much of the work that is often taken for granted—I particularly remember this, as an Agriculture Minister in Northern Ireland and an Environment Minister here. From storing water to help prevent flooding, to providing habitats for wildlife, farmers and landowners take these responsibilities very seriously. British farmers produce the highest quality affordable food that is greatly valued by the British public and is the envy of people all over the world. The farming industry directly employs 400,000 people and more than 70% of the UK’s landmass is used for farming.
More widely, farming underpins a food and drink industry that contributes more than £100 billion each year to the UK economy and employs 3.8 million people. It is a vital part not just of the rural economy but of the national economy. However, I am concerned that, having clearly set out his environmental credentials, the Secretary of State has yet to do so for farming. He must do this as a matter of urgency: farming must not be forgotten or left behind in a drive to deliver environmental benefits. We need to remind ourselves that what we eat every day, including, I say very humbly, here in this House, is almost certainly a product of British farms and British waters. I urge the Government to ensure that they do not just rely on this Bill to protect the environment but also, crucially, to ensure a thriving and value-for-money agriculture sector.
Lord O’Neill of Clackmannan (Lab)
My Lords, I start by saying that I am a remainer who would like to have the opportunity to vote for a second referendum Bill but not, I think, in the context of this piece of legislation. The Bill has been dismissed by some as merely an enabling—that is, it is primarily about process. I would add a cautionary note here and say that when we deal with matters of process we very quickly become engaged in areas of substance. The Bill has a number of areas where more work needs to be done. This is nothing new: in my experience of the Commons, and even of this House, a Bill that starts at Second Reading, goes through Committee and Report and ends up here, results in many different amendments. Certainly, this Bill is not the finished article. The range and complexity of the topics it covers and the need for much of it to be agreed with EU negotiators means that there is still much to be done. That may be proposed as an excuse for its inadequacies—if that is the right word—but there are certain areas where it is not a get-out clause for Government.
A number of noble Lords have referred today to the so-called Henry VIII powers, and I believe that this is such an area, because it will not go away. The Constitution Committee has pointed out that there may well be some areas where change can be achieved only by the use of Henry VIII-type measures—declaratory ones, or certain forms of statutory instrument. It is a general rule, however, that it is unacceptable for primary legislation to be amended by any means other than the full parliamentary process. If it is not subject to parliamentary scrutiny, that is quite likely to prejudice the acceptability of a lot of other changes that the Bill intends to enact.
Withdrawal from the EU is controversial. The referendum result was not overwhelming. A majority of one is enough, but it is incumbent on the Government to achieve a working consensus. This is not a binary, winner takes all, process. The Scottish independence referendum was an electoral civil war in Scotland, from which the country has not yet recovered, and that referendum resulted in a far bigger majority. I mention this because there is still a pronounced fragility about the state of the union as far as Scotland is concerned. Reference has been made to Clause 11, and the problems that this presents not just to Scotland but to Wales and Northern Ireland. There are those who will be quite happy to exploit some of these difficulties for their own purposes.
I would like to think that the Government will give this area a far higher priority, that process is dealt with here quickly and that the amendments acceptable to Parliament, Assemblies and both Houses can be produced in good time. If we do not do that, we could be dealing with withdrawal Bills of a rather different character before too long.
The Government have said that everything is moving and will be okay. So far the record does not suggest that we can take that with a great deal of confidence. Nevertheless, if the Government are going to come to this House with the amendments that everyone seems to recognise as desirable, they will have to do so quickly—before Report and Third Reading. I would like to think that if we can do that, we may not get other challenges to the unity of the United Kingdom, let alone our relationship with Europe. It is, however, fair to say that if we can get legislation that covers a wide range of the necessary amendments—those that most members of this House would be prepared to accept—then it would be only reasonable at that stage to have the opportunity of a truly meaningful vote on the settlement. Then, if required, we could put it to the country as a whole.
However, time is not on our side and we need to address this with a far greater degree of urgency. But the urgency with which we must address it should not be regarded as an excuse for driving the Bill through on a series of timetable Motions or threats of a kind that would simply recreate the current resentment, which we have a chance to diminish in the very near future.
Baroness Morris of Bolton (Con)
My Lords, no one ever said that the process of leaving the EU was going to be easy, and we are in for some interesting days and discussions during the further stages of this Bill. As my noble friend the Leader of the House explained so well, put simply the Bill seeks to ensure that by the time we leave the EU, laws which currently govern our everyday lives and give protection to us as individuals, businesses and institutions will be transferred to UK law to ensure continuity and certainty.
In this process, there are those who fear that the Government are making a power grab and that hard fought-for rights and obligations might be threatened. Yet others such as my noble friend Lady Eaton would like to see that process built on to provide greater freedoms for local communities. These are understandable issues and concerns and it is right that, during debate on the Bill, they should be explored to see whether improvements are needed. But what would not be right would be for this House to seek to frustrate that process and to set it at odds with the elected House. It was most reassuring to hear from the noble Baroness, Lady Smith of Basildon, and other noble Lords across the House that this is not their intention. I hope that intention will hold when we start to get into the detail of the most contentious issues.
It is inevitable that throughout today’s debate there has been discussion of our future economic relationship with the European Union. The noble Lords, Lord Mandelson and Lord Hain, along with my noble friend Lady Wheatcroft and others, have said how important it is that we stay in the single market and the customs union. Staying in either of these would mean accepting many of the rules and regulations of the EU that were disliked by the British people and instrumental in leading to a no vote in the referendum, without the corresponding balance of a seat at the negotiating table to argue our corner. If that were to be the case, it would be legitimate to ask what all this palaver had been about.
This is especially the case with the customs union, membership of which would not allow us to negotiate our own free trade agreements with other countries—however difficult those may be, as we heard from the noble Lord, Lord Wilson of Dinton. Yet the IMF’s latest World Economic Outlook database calculates that 90% of future growth will come from outside the European Union. It is these countries which will give the UK the opportunities for new business and increased prosperity. So it is vital that we as a country are free to negotiate and strike deals throughout the world. I declare my interest as one of the Prime Minister’s trade envoys.
The right reverend Prelate the Bishop of Leeds and my noble friend Lord Bridges both asked, “What kind of Britain do we want to live in?”. It may surprise some of your Lordships to know that in the referendum I voted to remain, not for economic reasons but for those things so eloquently expressed by the noble Baroness, Lady Royall of Blaisdon, such as tolerance and friendship—the things that the noble Lords, Lord Triesman and Lord Winston, hold so dearly. It was also for the collaboration in a host of areas which I felt brought stability in a world which does not always have a surplus of that. I know that your Lordships might think me a bright-eyed optimist but I am encouraged that these relationships will flourish. I am trying to look at it in a different way now. But I am encouraged—I know noble Lords might think that I am a bright-eyed optimist—that these relationships will flourish, and I am trying to look at it in a different way now. As my noble friend Lady Finn is fond of saying, we were in with opt-outs, now we will be out with opt-ins. There will be many areas of future co-operation, not least on our security and intelligence operations, which are as essential for the security of Europe as they are for us.
Finally, the noble Lord, Lord Adonis, whom I consider a good friend, along with many others is passionate in his desire to stay in the European Union, and I fully understand that. But we have had that debate, and I fear that a second referendum would weaken our negotiating hand and extend uncertainty. As we have already heard from my noble friend Lord Hill of Oareford, business leaders are saying that the political paralysis caused by the process of Brexit depresses them more than Brexit itself. People just want us to get on with it.
I sincerely hope that we can all come together and that the creative and ingenious among our number, many of whom are bitterly disappointed by Brexit, will focus their talents and energies on helping to make this Bill and Brexit a success in the future interests of our country.