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Oral Answers to Questions
(4 years, 9 months ago)
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Sara Britcliffe (Hyndburn) (Con)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Our clean air strategy sets out an ambitious programme of action to reduce air pollution from a wide range of sources. We have also put in place a £3.8 billion plan to tackle roadside nitrogen dioxide concentrations. Our Environment Bill makes a clear commitment to set a legally binding target to reduce fine particulate matter and enables local authorities to take more effective action to tackle air pollution in these areas.
Sara Britcliffe
Hyndburn has the highest levels of air pollutants in Lancashire and double the county’s average level of nitrogen dioxide. What work is being done with local councils such as mine to tackle that?
Rebecca Pow
I thank my hon. Friend for her question; I see that she is already standing up for her constituency. Air pollution has reduced significantly since 2010. Emissions of nitrogen oxides have fallen by 33% and are at their lowest level since records began, but that is not to say that there is not a great deal more to do. In Hyndburn, nitrogen dioxide concentrations around roads are actually within the statutory air quality limit, though local authorities are empowered to address local air quality concerns within their community. We have put in place a £3.8 billion plan to improve air quality and deliver cleaner transport, and last year we published our world-leading clean air strategy, which focuses on broader emissions beyond road transport and aims to cut air pollution and save lives. That strategy includes new and ambitious goals, legislation, investment and policies to clean up our air.
Deidre Brock (Edinburgh North and Leith) (SNP)
Will the Minister join me in welcoming the more stringent air pollution reduction targets that the Scottish Government have agreed in legislation, and does she agree that the UK Government should match those targets in their Environment Bill?
Rebecca Pow
I thank the hon. Lady for her question, but actually our clean air strategy has been described by the World Health Organisation as
“an example for the rest of the world to follow”.
With our £3.8 billion commitment, we are definitely leading the way.
Kerry McCarthy (Bristol East) (Lab)
Angela Richardson (Guildford) (Con)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Forestry is devolved, and we are working with the devolved Administrations to increase tree planting across the UK to 30,000 hectares per year by 2025. To drive up planting rates in England, we announced a new £640 million nature for climate fund, and we are developing an ambitious delivery programme. We will seek feedback and evidence on this through our new English tree strategy.
Kerry McCarthy
I thank the Minister for that response. The Committee on Climate Change has said that we need to plant 32,000 hectares a year for the next 30 years if we are to meet the net zero target, but my understanding is that the Government’s recent announcement was that they would be planting 30,000 hectares in full by 2025, not per year. Can the Minister clarify that? The manifesto commitment was per year, but I think the Government have not now committed to that.
Rebecca Pow
Just for clarification, in our manifesto it was 30,000 hectares per year.
Angela Richardson
I thank the Minister for her answer, and I welcome the investment in our green infrastructure. May I ask how the Government have funded woodland creation?
Rebecca Pow
The Government have made major commitments. Chiefly, as I have mentioned, we announced the £640 million nature for climate fund in our manifesto. Ministers are working with officials on policy proposals to increase tree planting in England over this Parliament. We have also kick-started funding for planting the new Northern and Great Northumberland forests. In addition, last year we opened the £50 million woodland carbon guarantee, giving long-term income support to new woodland creation projects, while pump-priming the domestic carbon market, which is obviously something that will grow.
Jim Shannon (Strangford) (DUP)
I thank the Minister for her responses so far. In her statement in answer to the original question, she referred to having been in touch with the Northern Ireland Assembly and the regional Administrations. Northern Ireland lags behind when it comes to tree planting. What discussions has the Minister had with the Northern Ireland Assembly to ensure that tree planting in Northern Ireland catches up with the tree planting that she mentioned in her statement and answers?
Rebecca Pow
Obviously, we are keen for tree planting to expand everywhere, including Scotland. Scotland already does a lot of tree planting, because the nature of its landscape is somewhat different from ours. We have a raft of measures, and our officials will be speaking to officials in Northern Ireland. It is very important that we keep all that contact and do this as a joint thing. Trees work on the atmosphere: they hold the carbon dioxide, and that goes everywhere, so we need to be doing this jointly.
Tim Loughton (East Worthing and Shoreham) (Con)
It is absolutely right that we vastly ramp up tree planting to help with carbon capture, but may I ask the Minister not to overlook kelp? It absorbs more than six times the amount of carbon as trees. We have vast tracts of seabed available, not least off Sussex. It helps with marine conservation, and it is also a food source. Please could we look at that more closely, and at how we can promote it, as we want to do, in Sussex?
Rebecca Pow
My hon. Friend raises an incredibly interesting point. It is something I am personally very interested in. As we speak, there is a project under way to plant kelp and to look at how its carbon capture is going. Mudflats are similarly really important, as are salt marshes. There could be a big future for this on our new horizon of dealing with the land and the landscape. All this carbon capture is a new feature in relation to climate change, and I think kelp will definitely be part of it.
John Spellar (Warley) (Lab)
The Minister has talked a lot about planting trees, but made no mention of where those trees will come from; in other words, will they be sourced within the UK or will we be importing them, which will have an impact not only on employment but on the importation, as we have seen previously, of pests and diseases? Will the Minister therefore give long-term contracts to the horticultural industry so that it can rapidly ramp up the production of seedlings, for the sake of the British economy and as a health and safety measure ?
Rebecca Pow
I forgive the right hon. Gentleman for going on, because it is brilliant to mention horticulture. Horticulture is such an important part of this country, and we are in discussions with nurseries, because he is absolutely right that they have to provide these trees. We would obviously like as many as possible to come from the UK, because that is very important, particularly on biosecurity grounds. I see a great new future in that for those nurseries, and we are in discussions with the industry.
Mr Philip Hollobone (Kettering) (Con)
I declare an interest, as a member of Kettering Borough Council, which is increasing its planting of British native trees from 250 to 500 a year and supports plans for 40 hectares of new trees across north Northamptonshire on an annual basis. What more can be done to incentivise local authorities to plant more trees?
Rebecca Pow
As ever, my hon. Friend is a fantastic advocate for his constituency. Many local authorities are embarking on excellent planting schemes. There will be some big opportunities through the Environment Bill in the biodiversity net gain sector, where lots of people will be able to offset when building a development; they can plant some trees to add 10% more biodiversity. There will be opportunities right around the country through the new nature recovery strategies which my hon. Friend’s local authority will be a part of providing, and that will determine where the trees should be planted.
Liz Twist (Blaydon) (Lab)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
I feel like a jack-in-a-box, Mr Speaker.
The UK supports a number of initiatives to eliminate deforestation from supply chains in line with the aims of the Amsterdam declaration. That includes establishing UK roundtables on palm oil and soya to help UK companies realise sustainable sourcing commitments and supporting the tropical forest alliance, a public-private initiative with over 160 members. We also convene the global resource initiative, which will shortly recommend further actions that the UK can take to green our supply chains.
Liz Twist
In the year when are due to host COP26, the Environment Bill must be world leading and set an example for other countries to follow. How will DEFRA take responsibility for the UK’s global footprint, and will the Minister confirm that there will be action to remove deforestation from UK supply chains in future?
Rebecca Pow
The hon. Lady raises an incredibly important point and our vision is for everyone to benefit from more sustainable production of vital agricultural commodities. We have addressed this within the Environment Bill. Our global footprint is incredibly important, and we are considering the recommendations in the global resource initiative and will be very seriously thinking about how Government can take that forward. We are leading by example in many other areas, particularly our Government’s partnerships for forests programme and the soya programme that I mentioned in my previous answer.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
The Government are in close contact with representatives of the food supply chain and with local authorities, including those in the north-east, and also with charities, to ensure that those who need to stay at home will have continued access to food. We have well established ways of working with the food industry during disruption and our retailers already have highly resilient supply chains and are working around the clock to ensure that people have the food and other products that they need.
Chi Onwurah
All of us found the images of empty supermarket shelves disturbing, but for those who are vulnerable, aged, unwell, isolated or dependent on food banks, that is causing real fear as to where their next meal is coming from. In the north-east, we have excellent local producers, but much of our food is dependent on supply chains, and I am afraid the Secretary of State’s response will not have given the reassurance required. What specifically is he doing to ensure the supply of food to the supermarket shelves and from the supermarket shelves to people’s homes?
George Eustice
It is very important to note that we have significant resilience in our food supply chain, in that food manufacturers are used to coping with increases in demand, not least every year during Christmas. There is not a shortage of food. The challenge we have had is getting food to shelves in time when people have been purchasing more. That is why we have taken steps including setting aside delivery curfews so lorries can run around the clock, and relaxing driver hours to ensure that deliveries can take place more frequently. We are in discussion with Ministry of Housing, Communities and Local Government colleagues about other support that we would deliver locally to get food to those who are self-isolating.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
I thank the Secretary of State for meeting me and the rest of the shadow DEFRA team this week to discuss concerns about the national crisis and food availability. I urge him to go further on some of the measures he has set out. I hope my questions are seen as being asked in a constructive spirit.
People are worried about how they will feed their family, especially if they are self-isolating, have had their income slashed to statutory sick pay or have lost their job. However, millions are already in food poverty, and this is an immediate family emergency for many of them. With food banks running low on food, and given that many food bank volunteers are over the age of 70 and will soon need to self-isolate, what steps is the Secretary of State taking to assist those in genuine hunger today?
George Eustice
As I have said, we have taken a number of steps to ensure that we can get food to supermarkets. I have been in daily calls with the food supply sector. Those have included discussions about food banks, and we are in dialogue with supermarkets to ensure that they get access to the supplies they need. I welcome the constructive approach that the shadow Secretary of State is taking. We are also working on specific proposals to help the most vulnerable—those with clinical problems—to ensure that we can get food to them should they be self-isolating.
Luke Pollard
I thank the Secretary of State for that answer. I think he will need to provide more detail for those who are in genuine hunger today; the hope of detail in the future is not reassuring people at the moment. If I may press him further on supermarkets, we discussed the so-called grey hour, when elderly people can shop before the rest of society goes into the supermarkets. Will he press the Department for Transport to relax the times for free bus pass use to ensure that people can get to the supermarkets? Will he also ensure that every supermarket, not just the Co-op, is still contributing food to food banks and organisations such as FareShare? I suspect that he and his colleagues will want to ensure a private sector-led solution wherever possible, but I press him on this issue, because we will not get through this crisis unless there is Government intervention to support those people and ensure that food supply chains remain open.
George Eustice
The hon. Gentleman is absolutely right that there is a role for the Government. We must take action to set aside any obstacles to making the food supply chain operate in a way that ensures that people have food. On food banks, as I said, we are in discussion with supermarkets. We have also had discussions with them about competition law, and we will take whatever action is necessary to ensure that they can jointly plan their approach to these matters. For the most vulnerable, we are working on proposals that my colleagues in MHCLG will announce shortly.
Theresa Villiers (Chipping Barnet) (Con)
Getting home deliveries to potentially millions of self-isolating households is a massive logistical exercise. Is it time for the Government to think about further intervention, including, I am afraid, the suspension of competition rules, so retailers and haulage companies can work together to meet this huge national challenge?
George Eustice
My right hon. Friend makes a very important point. That is why earlier this week we had a detailed workshop with both retailers and food processors to identify what they would like to do and what changes to competition law we would need to consider and implement. We are working on that right now.
Mark Pritchard (The Wrekin) (Con)
Telford and Wrekin Council will now have to deliver 5,000 free school meals a day without being able to do so through schools, except for key workers’ children. What more can the Government do, given that many volunteers and people working in charities who might offer to backfill where support is required may be self-isolating or may have been encouraged by the Government to self-isolate? There really is an issue with logistics.
George Eustice
My right hon. Friend the Secretary of State for Digital, Culture, Media and Sport is working on a national volunteer project to co-ordinate the many offers of volunteer help that we have had. In the context of food, we have been working very closely with supermarkets to expand their click-and-collect services to make it easier, where possible, for them to expand their delivery capacity to homes. We continue to work with other groups to identify how we can get food to people at this difficult time.
Andrew Selous (South West Bedfordshire) (Con)
Care homes and other residential settings that have been let down by their wholesale food suppliers are now being told by supermarkets that they will be treated just like any other consumer. Two chickens do not go a long way if they have 136 residents to feed. Will the Secretary of State urgently look into this issue for all residential settings, please?
George Eustice
I am happy to look at the specific issue that my hon. Friend raised. However, it is also worth noting that while there has been an increase in demand at retail shops, notably in supermarkets, there has been a sharp fall in demand in the service trade, as restaurants, pubs and so forth find that demand for their services has plummeted. Our understanding at the moment is that there are not issues in the food service supply chain, but I am happy to take up any particular case that he might have.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
Our supermarket workers have shown themselves to be the heroes of retail, making sure that people get fed and get the food that they need, but there are real concerns about whether they can maintain that service if they are not included in the list of key workers. Of course, many will have children who will need care if the schools cannot accommodate them. Can we have an assurance today that our retail workers will be on the list of key workers?
George Eustice
The Prime Minister made reference yesterday to the importance of those working in the food retail sector, in particular. Later today, the Government will announce jobs defined as key workers, but I can assure him that we fully recognise that over 25% of staff generally working in the food supply chain have children of school age, and that will be reflected when the list is published.
Kevin Hollinrake (Thirsk and Malton) (Con)
Damian Hinds (East Hampshire) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
We have committed to maintaining the budget for our future agriculture policy at the same level as now, but to direct it differently. We are designing our farming reforms with those who work in agriculture and considering resilience issues. During the transition period, farmers will have time to adapt and prepare for the new policy.
Kevin Hollinrake
Farmers’ and landowners’ ability to protect their crops and their livestock will be seriously compromised unless general licences are issued for protected areas, gulls and traps this spring. Will my right hon. Friend set out what he can do to make sure that that is the case?
George Eustice
My hon. Friend raises an important point. I am aware that Natural England intends to circulate the stoat-trapping general licence to stakeholders this week, and it is working hard to grant those licences as soon as possible. People wishing to control wild birds in protected areas need to apply for an individual licence, as must those wishing to control lesser black-backed or herring gulls except for safety reasons, given their poorer conservation status. We are also considering the best future approach as part of our review.
Damian Hinds
Right now, DEFRA, quite rightly, is focused totally on the food-supply questions that we have been talking about, but will my right hon. Friend also confirm that he will look to move forward with a trade and standards commission for food quality for UK consumers and for a fair field for our farmers?
George Eustice
My right hon. Friend makes a very important point. He will be aware that our manifesto and our published objectives for the US trade deal make it clear that we will protect our food standards and animal welfare in any future trade deals. I am aware that there has been a proposal for a trade and standards commission, which we are considering, and we are in discussion with other Departments, such as the Department for International Trade, about how best to ensure that agricultural expertise is fully reflected as part of the negotiating team.
Daniel Zeichner (Cambridge) (Lab)
If the motto in past crises was “Dig for Victory”, so far this one has been much more “Distribute for Victory”. Of course, the retail sector is very important, but I am less sanguine than the Secretary of State about future food supply and I think that we need to make sure that we support all those in that chain. The poultry industry, for instance, is very time-dependent. Two or three days extra for chickens on farms can lead to a whole range of welfare and logistical issues. Can I take it that the Secretary of State is pressing his colleagues to ensure that all those in the food supply chain are recognised on the Government list of key groups of workers, so we make sure that we secure our future food security?
George Eustice
As I said in response to an earlier question, the Government recognise that a significant number of staff working throughout the supply chain, both retailers and food processors, have children of school age; we estimate that the figure is between 25% and 33%. We therefore recognise that many of them will need to be defined as key workers, but further information on that will be published by the Government later today.
Dave Doogan (Angus) (SNP)
The standards of agriculture produce and animal welfare in Angus and elsewhere in these islands is among the best in the world. Is it not the case that the standards of imports are not always up to the standards of UK production? Is it not important that we follow the simple premise that, if something cannot lawfully meet the UK standards of production, it should not lawfully be imported to the UK? Will the Secretary of State enshrine that in the Government’s legislation?
George Eustice
We had a clear commitment in our manifesto to protect food standards and animal welfare in any future trade deals we do. Our view is that the right way to do that is through getting our mandate and approach to the negotiations right, and not necessarily by attempting to draft something in legislation.
Craig Whittaker (Calder Valley) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
The Government activated the flood recovery framework in November 2019 and February 2020 to provide support to communities such as Calderdale, where 100 mm of rain fell in just 12 hours, causing extensive flooding. I extend my thanks to all those involved in the responses to recent floods, including those in Calderdale; I thank the local council, the Environment Agency, the military and emergency services for all their hard work.
Craig Whittaker
As my right hon. Friend is aware, the funding package comes from several different Departments and, in the case of an isolated incident like that of the Calder Valley after Storm Ciara, and even after 1,200 properties were flooded, Government support for households was not triggered. Will he ensure that support by way of an off-the-shelf package is available for any affected area in future and that no area has to wait nine days again for support?
George Eustice
My hon. Friend raises an important point. We are having discussions across government about having a consistent threshold above which the flood recovery framework might be activated. On Storm Ciara, which affected his constituency very badly, in the event, we decided to treat Storms Ciara and Dennis as a single episode, which meant that Calderdale did qualify for the same support that other areas had.
Mr Richard Holden (North West Durham) (Con)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Our new environmental land management scheme will reward farmers and other land managers for delivering environmental public goods. We are committed to co-designing the scheme with stakeholders to produce the best possible outcomes for both the environment and our farmers and land managers. We are currently running a programme of tests and trials, which will be followed by a three-year national pilot, commencing in late 2021. The scheme will roll out from late 2024 across England.
Mr Holden
Although my upland farmers in Weardale are already working on schemes such as peat restoration and afforestation, my lowland farmers are particularly concerned that they might miss out on some of these environmental schemes. What reassurance can my hon. Friend give me that these schemes will be available to all?
Rebecca Pow
I thank my hon. Friend for that pertinent question. New schemes will be for all farmers, in all areas and for all types of landscape. At the moment, farmers can enter our new countryside stewardship agreements, which start from January 2021. Those who sign up to the improved scheme and who wish to enter the new environmental land management scheme will be able to leave their countryside stewardship agreements at agreed exit points, without penalty. Lots of farmers were concerned about that issue, but it is now clear that they can do that. Financial assistance under the environmental land management scheme will be available for all farmers and land managers, including lowland farmers in the country who undertake the eligible activities.
Neil Parish (Tiverton and Honiton) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
As my hon. Friend is aware, Henry Dimbleby is leading an independent review of the food system to develop recommendations to shape a national food strategy. The review was launched in June 2019. A vision for the food system is scheduled for publication in the spring of this year, and the review’s final recommendations will be published over the winter. The Government will then respond to those within six months.
Neil Parish
In these moments of great crisis when we need food, there is no doubt that home-produced food is more important than ever. I would really love it if the food strategy incorporates how we are going to produce more home-produced food. Further to the question from the hon. Member for Angus (Dave Doogan), I am looking forward to the Secretary of State supporting the amendment from the Environment, Food and Rural Affairs Committee to maintain high standards on food imports. Can that all be incorporated into the food strategy?
George Eustice
My hon. Friend makes an important point. Events such as those we are experiencing now remind everyone that a critical component of our food security is healthy and vibrant domestic production, which is why we have committed in the Agriculture Bill to review our food security every five years. That will include a review of the health of the food supply chain and food production in this country.
Nick Smith (Blaenau Gwent) (Lab)
What steps are the Government taking to adapt the seasonal workers scheme to support farmers in this important growing season?
George Eustice
The hon. Gentleman raises an important point. If there is disruption to people visiting the UK as a result of restrictions put in place, or general concern in other countries, that may have an impact on the number of seasonal workers who come here from countries such as Bulgaria. We are working with the industry and the National Farmers Union to assess the situation, and we will be working on proposals to address it before May and June, which is when it is likely to present itself as an issue.
Ben Everitt (Milton Keynes North) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
The covid-19 pandemic presents significant challenges for our country and, indeed, the rest of the world. It is currently my primary focus. I have been holding regular calls with key players in the food supply chain, to ensure that we take whatever steps are necessary to enable our food producers, distributors and retailers to meet an increase in demand. I wish to record my thanks to all those who work in the food industry—whether on a production line, driving a delivery vehicle or in a supermarket—for all the hard work they are putting in at this difficult time.
Ben Everitt
Our farmers are famously hardy folk, but like everybody else they are not immune to the effects of coronavirus, and nor are farm businesses. What further support will be available to farmers?
George Eustice
Earlier this week the Chancellor unveiled a package of measures to support all businesses, and some farmers would qualify for that. I am having regular meetings with the National Farmers Union to address any concerns that it might have. The NFU’s principal concern, in common with many other industries in the food supply chain, is the potential pressures on staff.
Ruth Jones (Newport West) (Lab)
The shadow Secretary of State and I have spoken to fishers and their representative organisations right across the UK in recent days, and they are worried. In just the past week, the market value of fish landed by British fishers has fallen to 20% of normal rates. There are significant concerns about the viability of the UK fishing industry, especially the small boats that are the backbone of the British fleet. Many fishers are telling us that they will go bust in the next two weeks. Does the Secretary of State agree that we must take whatever steps are necessary to support fishers and the fishing industry to cope with the pressures of the covid-19 crisis?
George Eustice
I obviously agree that our fishing industry is incredibly important. The best way we can help it is to get the markets moving again. I understand that there is a particular issue with disruption to markets in the European Union, which is contributing to the situation. Officials had meetings yesterday with fishing representatives, and I am looking for some feedback from that to agree what we do next.
Rob Butler (Aylesbury) (Con)
George Eustice
My hon. Friend raises an important point: it is not just those employers with large numbers of staff that could face challenges; it could be those with a very small number of staff, or those with no staff, who operate alone. We are working with the National Farmers Union and others to work out ways to address this issue. It will require friendly and supportive neighbourly behaviour in some cases.
Helen Hayes (Dulwich and West Norwood) (Lab)
George Eustice
The hon. Lady raises an important point. The Government have given specific guidance to those considered most at risk, including the over-70s. There will be additional support for those with clinical issues that make them especially at risk.
Sir Desmond Swayne (New Forest West) (Con)
George Eustice
My right hon. Friend makes an important point. During this situation, we need everybody to be considerate to others. A number of supermarkets have piloted the idea of a reserved hour at the start of each day for the elderly and most vulnerable. That appears to be working and we will encourage others to do that. There is a limited amount of delivery capacity—currently about 7% of the market—but we will increase that if we can.
John Spellar (Warley) (Lab)
George Eustice
When it comes to public procurement, for a number of years, we have had an approach called the balanced scorecard, which means that it is not all about price and that our procurement authorities should also take into account quality and other factors, too.
Mr David Jones (Clwyd West) (Con)
The spring selling season will soon be upon us. Across the country, against the background of the coronavirus crisis, farmers will be concerned to establish whether they will be able to buy and sell their livestock. Can the Secretary of State give any reassurance to farmers as to the extent to which they will be able to use their local farmers auction markets?
George Eustice
We are looking into that issue, but it is obviously critical to keep the food supply chain moving.
Bill Esterson (Sefton Central) (Lab)
Supermarket queues are undoubtedly adding to the spread of coronavirus, not least because of a lack of social distancing. Doing whatever it takes means that there needs to be a sense of urgency from Government Ministers that simply has not been on display thus far across Government. [Interruption.] I am sorry, but it is true. People need to see a much greater sense of urgency. Queues need to be tackled to prevent the spread within supermarkets. Will the Secretary of State, with Cabinet colleagues, today implement and enforce social distancing in supermarkets to reduce the spread in that part of society?
George Eustice
We will not take that measure. It was done in Italy through a restriction on the number of people in stores, but they found that they had hundreds of people huddled together at the entrance to the store, so it was counterproductive.
Robert Courts (Witney) (Con)
There is growing concern in West Oxfordshire about the condition of the River Windrush, and particularly sewage discharge. We urgently need the Environment Agency and Thames Water to work together to clean it up. When the immediate emergency has eased, will the Secretary of State visit to see the river’s condition and help me to work with those two parties to make a real difference?
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Such incidents are an issue for the Environment Agency, which is the first port of call in a pollution incident. Water companies have water management plans and, under the new Environment Bill, will have to have sewage management plans as well, which will help. Of course I will meet my hon. Friend to discuss the issue.
Christian Matheson (City of Chester) (Lab)
I understand that in 2019, the Department for Environment, Food and Rural Affairs and FareShare worked on a pilot scheme to make sure that surplus food was diverted to people who needed it. That is still being evaluated. When will Ministers come up with the evaluation? Is now not a good time to put the scheme into practice?
George Eustice
As I said, we are working with food banks and retailers to ensure that they have the supply of food they need through schemes such as FareShare.
Scott Benton (Blackpool South) (Con)
I am sure that all hon. Members welcome the additional investment in flood and coastal defences in last week’s Budget. Will the ministerial team continue to work with local authorities such as Calderdale, which was flooded recently, to ensure that existing gaps in flood defence schemes are addressed?
Rebecca Pow
I thank my hon. Friend for that question. The Government are making a massive commitment to flood spending and they have increased the current programme from £2.6 billion to £5.2 billion between 2021 and 2027. They will be working with all areas that have floods, listening to concerns and considerations to learn lessons from what happened this time and using the current grant system, but I, the Secretary of State and the Ministry for Housing, Communities and Local Government are considering how the whole project might be improved.
Dave Doogan (Angus) (SNP)
Kenny MacAskill (East Lothian) (SNP)
Pete Wishart (Perth and North Perthshire)
The commission has had no recent formal discussions on the potential merits of electronic voting. Colleagues on the Procedure Committee have examined what practical and procedural changes to Divisions might be necessary in the context of the covid-19 outbreak and I thank them for their work on that. I know that they will continue to keep the situation under review. Any decision to implement electronic voting would need to be agreed by the whole House. The commission’s responsibility for this matter would be limited to the financial and staffing implications of such a decision.
Dave Doogan
The SNP has long advocated modernising this place so that votes do not take hours. As a still relatively new Member, I am shocked by the archaic practices that we, as Members, have to undergo in order to vote. Does the hon. Member representing the House of Commons Commission ever see this House leaving the late 19th century?
Pete Wishart
I thank my hon. Friend for that question. In my almost 20 years in this House I have probably spent the best part of a week traipsing around the Division Lobbies, exercising my democratic obligations as a Member of the House. It is a week that I am certain I will never get back. Last July, the Procedure Committee began an inquiry into the merits of electronic voting, which was interrupted by the general election in December. So far, no decision has been made to reopen that inquiry, but I encourage my hon. Friend to beat a path towards the Procedure Committee to encourage it to take up the inquiry again. Knowing of his determination, I am pretty certain that he will do so.
Mr Speaker
We are reminded that we do respond to the commission’s views as well.
Kenny MacAskill
Last week, the Leader of the House declined the idea of an increased use of deferred Divisions. Given that we are in a changing landscape, that guidance has changed and, even within this Chamber, we are now self-distancing, will the commission reconsider that position?
Pete Wishart
The commission is acting with the most up-to-date medical advice from Public Health England. If at any point it was felt that we could not continue with Divisions in their current form, all feasible alternative arrangements will be looked at and put in place. I think my hon. Friend will have noticed just how responsibly this House has responded to the requests for social distancing. We just have to look around the Chamber and observe how we have positioned ourselves. I shall leave Members to form their own view about the wisdom of packing out the cramped Division Lobbies if there are any further Divisions in this House. I note that there has been none this week, and I know that it is the intention of Whips throughout the House to ensure that we will be using the Division Lobbies as infrequently as possible.
Clive Efford (Eltham) (Lab)
Pete Wishart (Perth and North Perthshire)
The control of access to the House of Commons is vested in you, Mr Speaker, and not the commission. Mr Speaker announced additional access restrictions on Monday 16 March, following the statement by the Prime Minister to prevent the risk of exposure to coronavirus. This includes restricting access to passholders and to those attending for business reasons, such as witnesses to Committees. Those measures were implemented with immediate effect. Updates on Tuesday and yesterday outline further measures to prevent the risk of exposure to covid-19, including stopping all non-essential access to the estate, and from today closure of several search and screen points around the estate.
Clive Efford
I tabled this question when there were rumours that Parliament would be closed and that we might not be invited back after the recess. Things have now moved rapidly beyond that, and we have to appreciate the members of staff who support us in keeping this place open so that we can do the vital job of holding the Government to account during this crucial period. May I invite the Minister to pay tribute to those staff who support us?
Pete Wishart
It is, in fact, me who will be invited to congratulate the staff around the estate. Every effort possible is taking place to ensure that staff are kept safe and that their exposure to risk is as minimal as possible. The hon. Gentleman is right to identify that every effort will be made to keep this place open so that we can fulfil our democratic obligations, but that will always be done with the safety of all who use this estate in mind, and will constantly be under review.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Pete Wishart (Perth and North Perthshire)
Enabling remote working for hon. Members and staff is a key priority in the Parliamentary Digital Service’s response to covid-19. One focus is the provision of emergency laptops to Members’ staff who are normally equipped with desktop computers. Currently, a reasonable stock of laptops is available, but it should be noted that market supply has been severely disrupted. As of close of business on Wednesday 18 March, 56 laptops had been provided to 41 hon. Members’ offices. Other IT equipment has been made available as requested, such as headsets for Skype for Business use. The Microsoft Office 365 suite of tools is available remotely via personal devices and parliamentary computers. Part of that suite is Microsoft Skype for Business, which offers one-to-one video conferencing facilities. No more extensive video conferencing service is yet deployed.
Chi Onwurah
I am sure that we all agree that the Parliamentary Digital Service provides amazing support for Members of Parliament in our wide-ranging and very demanding requirements. But our jobs are changing; I am not going to be able to have face-to-face contact with any constituent for the foreseeable future, and my staff will all be working from home, so we need to have support for a broad range of new applications. The Commissioner talks about laptops and hardware. I want to know that PDS will have the resources to support a wide range of new applications, such as video conferencing.
Pete Wishart
I thoroughly agree with the hon. Lady. I think that all Members of the House will now know the value of being able to keep in contact with constituents through video conferencing and other remote methods. All I can say is that the PDS digital support desk will continue to offer a 24-hour-a-day service. Undoubtedly there will be delays due to the volume of calls from people working remotely, but the team will make a real effort to deal with all calls as soon as they possibly can. As I said in my original answer, the PDS team want to ensure that as much facility and resource as possible is given to hon. Members, and I am sure that they will be working to secure and achieve that.
Wendy Chamberlain (North East Fife) (LD)
I meet a variety of organisations at Westminster, and would now like to do this remotely. However, the Skype system to which the Commissioner has referred only supports connections to those with parliamentary accounts. This helps me to link with my team, but will the Parliamentary Digital Service consider making Skype accessible to those outwith the parliamentary network? As a new MP, I also have new staff joining my team. What are the learning and development team doing to offer critical training for new starters—for example, on the Department for Work and Pensions, and so on? Will there be opportunities for those training sessions to be available remotely, as opposed to face-to-face as they have been up to now?
Pete Wishart
Every effort will be made to ensure that people are connected, and all facilities will be used to keep Members of Parliament in contact with their constituents. The PDS support desk is looking at the very issues mentioned by the hon. Lady, and hopefully progress will be made on all that. I think that the lesson here—this seems to be required from all Members—is ensuring that we can work remotely, that all our staff are as connected as possible, and that we continue to provide a level of service that we feel is commensurate with our roles as Members of Parliament. I am pretty certain that all Members will be providing that service in the weeks to come.
Mr Tobias Ellwood (Bournemouth East) (Con)
I welcome the hon. Gentleman’s energy to move us from the 19th century, particularly during these difficult times. The move to digital is important, but the telecoms companies are concerned that the sudden deluge from the entire nation moving to a digital platform will overpower those platforms themselves. Has he considered any contingency plans in case we do need to return in full back to the 19th century?
Pete Wishart
All I can say to the right hon. Gentleman is: let us not go back to the 19th century. Let us hope that our 21st-century resources and infrastructure are able to cope with the increased demand that Members of Parliament and other people across our community will make on them. It is beyond my remit as a member of the House of Commons Commission to be able to comment on the failings of some of the infrastructure and its ability to withstand some of the demands that will be placed upon it.
All I can say to the right hon. Gentleman is that in the House of Commons, staff in digital services will do everything possible to ensure that we continue to be connected with our constituents. I would suggest to all Members that if they have any concerns about being able to work remotely or concerns about the ability of the network to withstand things, please get in touch with the 24-hour services available from digital services. I am sure everyone knows the number: 2001.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The challenges of the last few days and weeks have thrown up why we need to modernise this place and why we need to get on with restoration and renewal. I understand that the Commission is meeting on Monday to discuss next steps. Is it not time that we gave the sponsor body the powers to get on with dealing with the Northern Estate, make sure it is in the hands of proper professionals who can get on with the work and make sure that we are resilient for this sort of situation in the future and for many years to come?
Pete Wishart
I commend the hon. Lady’s creativity in being able to shoehorn restoration and renewal into question about digital facilities. She is absolutely right: the Commission will meet on Monday to consider further measures when it comes to restoration and renewal. The hon. Lady is very closely connected to and interested in this work, and those measures will be communicated when we have concluded our meeting on Monday. It is something, even in the current conditions and with the crisis that is facing us, that the Commission takes very seriously, and we will continue to inform the House of ongoing statements and work in relation to restoration and renewal.
Bob Blackman (Harrow East) (Con)
The Second Church Estates Commissioner (Andrew Selous)
I am pleased to be able to tell my hon. Friend that the Church opens as many, if not more churches than it closes each year. Parishes may want to focus their mission elsewhere, if the church in question is in a very remote rural location or if there is a very high repair bill. Use for worship by other Christian bodies is generally considered the best use, but there are many other suitable uses.
Bob Blackman
I thank my hon. Friend for that answer. In my constituency, we have 24 churches of different denominations, yet the Christian religion is actually the minority. More recently, we have had a huge influx of Romanian citizens who are very keen churchgoers, but they cannot acquire premises. So as the Church of England population dwindles, can churches make efforts to reach out, particularly to the Romanian churches, to allow them to carry on their worship?
Andrew Selous
I am very grateful to my hon. Friend for explaining the situation in his constituency, and I can tell him that the use of church buildings by other Christian denominations is considered a very good use for any redundant Church of England church. The normal procedure is that the views of the local Member of Parliament, the local authority and local residents would be considered, so if there are closed churches in his area, he will have an opportunity to get involved in that process.
Jim Shannon (Strangford) (DUP)
Can the hon. Gentleman outline what advice for smaller congregations is in place at this time? Is it his interpretation that the closure of all churches, regardless of size, is optional, or that small congregations can continue to meet, even if they do so in small numbers?
Andrew Selous
As my hon. Friend knows, I speak purely for the Church of England in this place, and the Church of England is following exactly the health advice from the Government. I can tell him and the House that while public worship has been suspended for the time being, churches remain open for prayer and in particular for baptisms, weddings and funerals. Self-distancing will be required. Numbers in churches will be kept to a minimum, and no one self-isolating must attend the ceremony. Parishes are being trained in live-streaming services where they can. Wellbeing and mental health resources will be published soon, and churches are of course encouraged to support the vulnerable who are self-isolating and to continue to support food banks and night shelters in particular.
Steve Double (St Austell and Newquay) (Con)
In the light of my hon. Friend’s response to the hon. Member for Strangford (Jim Shannon), does he agree that, although churches are not gathering for worship, they still have a vital role to play in meeting the spiritual, emotional and, indeed, practical needs of our communities at this very difficult time? Although they may not be gathering for services and other meetings, churches are most definitely not closed.
Andrew Selous
I thank my hon. Friend for that important point, and he is exactly right. The Church is much more than just its buildings; it is its people. This is an opportunity for all of us, as Christians, to reach out to others in need—there are many in all our communities—and that is exactly what the Church will be doing over the coming months.
Mr Philip Hollobone (Kettering) (Con)
As public worship is suspended during the coronavirus crisis, what plans does the Church of England have for a national day of prayer?
Andrew Selous
The Archbishop of Canterbury has called for a national day of prayer this Sunday. The Church is particularly keen that all Christians reach out to look after the vulnerable in their communities, as I have just said to my hon. Friend the Member for St Austell and Newquay (Steve Double). The archbishop has called for people to put lighted candles in their windows at 7 pm on Sunday as a sign of solidarity with what the nation is currently going through.
Caroline Ansell (Eastbourne) (Con)
The Second Church Estates Commissioner (Andrew Selous)
The Church of England is pleased that the Government have repeatedly said they will implement in full the recommendations of the Truro review. The Church is in regular contact with the review implementation team. Promoting faith literacy among our diplomats remains work in progress, but we are reassured by continuing work on that aspect of the review.
Caroline Ansell
I thank my hon. Friend for his answer. As the world looks to navigate the challenge of the virus, other challenges clearly remain. Indeed, those challenges can be exacerbated in such circumstances, so what steps is the Church of England taking to work hand in glove with the Foreign and Commonwealth Office to tackle anti-Christian persecution across the world?
Andrew Selous
I know my hon. Friend takes a strong interest in this important area. The Church is working closely with the Foreign and Commonwealth Office and with the Department for International Development to develop better religious literacy, and the Anglican communion combats persecution against all people of faith, or of no faith, around the world. The Church would welcome a Magnitsky Act to target sanctions against those who persecute people for their religion or belief, in line with recommendation 8 of the review. Quarterly progress statements on the implementation of the review would also be helpful.
Scott Benton (Blackpool South) (Con)
The Second Church Estates Commissioner (Andrew Selous)
Almost all couples receive marriage preparation before a Church of England marriage service. Some churches later offer marriage enrichment courses and marriage MOT evenings. The Church is concerned about the fall in marriage rates, as well as about the breakdown of marriages, and a number of churches are taking action to address this issue.
Scott Benton
I thank my hon. Friend for his answer. How does the Church aim to support couples and families in this moment of national crisis, when they are forced to spend more time together and are probably feeling anxious, possibly with several family members unwell?
Andrew Selous
I thank my hon. Friend for that very relevant question. The new marriage and pre-marriage courses released in January are now available online as digital resources that any church can forward to couples in isolation to help them invest in their relationship when they are likely to have more time together, as well as more pressure on them. The pre-marriage course welcomes and is suitable for couples who are not engaged but want to explore what marriage means.
Thangam Debbonaire (Bristol West) (Lab)
This is probably something to come back to once we have got past the immediate crisis, but what progress has been made on liaising with the Department for Education on aligning such pre-marriage education with schools’ relationship education, which has now been made compulsory for all young people? Will that tie up?
Andrew Selous
I thank the hon. Lady, who I know takes a serious interest in these issues, for her question. I can tell her that the Church is very keen to work hand in glove with schools in this important area. Relationship education and relationship support has a very important role in our schools so that we have healthy, respectful marriages and relationships throughout our country.
Tim Loughton (East Worthing and Shoreham) (Con)
May I suggest that one form of marriage support the Church of England might like to get on with is enacting clause 1 of my Civil Partnerships, Marriages and Deaths (Registration Etc.) Act 2019, which became law a year ago now and will overhaul marriage registration and allow mothers’ names to go on marriage certificates for the first time since 1832? Can he give us a progress report on whether this is at last going to happen?
Andrew Selous
I thank my hon. Friend for that question—he has been very diligent in pursuing this matter for some time. I know it was a particular concern of my predecessor, Caroline Spelman, when she was in this place. I will get my hon. Friend an update on that issue. I will tell Church House about the urgency of the situation, and if he will allow me, I will write to him with specific details.
Coronavirus: Employment Support
(4 years, 9 months ago)
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Greg Clark (Tunbridge Wells) (Con)
(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement about support for the wages of employees.
The Economic Secretary to the Treasury (John Glen)
This is an uncertain time for our country, but the Government are clear that they will do whatever it takes to protect our people and businesses from the coronavirus pandemic. On Tuesday, the Chancellor of the Exchequer set out further steps in the Government’s economic response, building on the initial response he outlined in the Budget last week, which included standing behind businesses, small and large, with an unprecedented package of Government backed and guaranteed loans to support businesses through this crisis. I have been working very closely with him and the banks, and they are very clear about their responsibility to make these measures work. The Government have made available an initial £330 billion of guarantees, equivalent to 15% of our GDP. That means that any business that needs cash to pay salaries will be able to access a Government-backed loan on attractive terms. The Government will do whatever it takes to support our economy through this crisis and stand ready to provide further support where necessary. As the Chancellor announced, we will go much further to support people’s financial security working with trade unions and business groups. Following his appearance at the Treasury Select Committee yesterday afternoon, the Chancellor spoke to the trade unions, and he will today be meeting the TUC, the CBI, the British Chambers of Commerce, and the Federation of Small Businesses. This will be with a view to urgently developing new forms of employment support to help protect people’s jobs and incomes through this period. I am sure that you will appreciate, Mr Speaker, that these are unprecedented times. The Chancellor has said that he will look at further steps to help protect jobs and incomes, and he will announce further details in due course.
Greg Clark
For much of yesterday, like many Members of the House, including the hon. Member for Birmingham, Erdington (Jack Dromey), with whom I have been working, I was speaking to businesses in our constituencies who are facing a crisis. With revenue collapsing and no knowledge of when normal trading can resume, they see no choice but to lay off workers now. The loan scheme that the Chancellor announced on Tuesday is not enough to prevent that. These businesses have no idea when they will be able to pay back the debts they would incur and it provides no reason to keep staff employed. In fact, the reverse is true because, the smaller the wage bill, the less would have to be borrowed. On Tuesday, the Chancellor promised that there would be employment support, but as each day goes by, businesses are making decisions that will be irreversible and if the Government do not act immediately, large numbers of people will be unemployed and registering them will put huge pressure on the welfare system. Vital skills will be lost and good businesses, which will themselves be the customers and suppliers of other businesses, will cease trading.
There is a straightforward and immediate solution. All employers have an account with Her Majesty’s Revenue and Customs to pay tax for employees through pay-as-you-earn. The monthly wage bill is known to HMRC. Instead of firms paying PAYE to the Government, that flow should now be reversed, with the nation paying the wages of people for the next few weeks if, and only if, they continue to employ their staff. Separate arrangements would need to be made for the self-employed, but at a stroke this would save people’s jobs, save businesses and put an immediate end to the risk of contagion and help to save the economy. This is a crisis the like of which we have not seen for 100 years. It requires a response that is immediate, effective and equal to the scale of the problem. The Chancellor said that he will do whatever it takes, and do so urgently. He now needs to make good on that without delay.
John Glen
I am very grateful to my right hon. Friend for raising this matter. I made clear in my response the urgency of the Government’s deliberations on this—it is absolutely at the top of everything we are doing. Ministers are working flat out, 24/7, to look at all the options.
My right hon. Friend raises the specific anxieties of businesses. I recognise that the package of measures that we have put out—with respect to statutory sick pay, easier access to universal credit and employment and support allowance, the business rates relief, the small business grant facility, the local authority hardship funds and the HMRC forbearance measures—will for some not feel sufficient at this point. However, he will also know from his experience in government that it is very important that when the Government announce the measures that we wish to take to assist with supporting employees, they need to be effective and need to work. So I say to the House and to my right hon. Friend: be in no doubt that all options are being examined. We are looking at models that exist in other jurisdictions and when, very imminently, the Chancellor comes to the House, we want to be sure that what we announce will be effective.
Peter Dowd (Bootle) (Lab)
It is now six and a half weeks since the first cases of coronavirus were reported in the UK. For over a month we have known about the substantial risk that coronavirus poses to the economy and to workers, yet the Government have announced no plan to protect jobs and wages—no full plan for employment support. We are all—all of us—inundated with so many questions, and I have just four of those questions to ask.
People are asking us: why, for example, have Denmark, which had its first coronavirus case on 27 February, and New Zealand, which had its first case on 28 February, four weeks after our first case, both announced comprehensive job protection plans, while we have announced nothing to secure people’s jobs and wages? Given that, the second question is: what consideration has been given to the models in Denmark and Austria, which the Economic Secretary referred to, which involve the Government paying the bulk of people’s wages in exchange for job guarantees?
The third question is: why, when the Chancellor announced the loan guarantee on Tuesday, did the Government not tie those loans into an undertaking from business that no one would be laid off? The fourth question: will the Minister accept that freelancers will need additional support if they do not qualify for statutory sick pay? For example, in the culture sector we have as many as 2 million people, hundreds of thousands of whom may be affected.
The country deserves answers to those questions as a matter of urgency. We will continue to ask these questions not as a matter of political point scoring or ideology, but to ensure that we have a Government response that properly protects the public and matches the scale of the crisis affecting us here and now, not just next week.
John Glen
It is in order for the hon. Gentleman to raise those points, and he is right to draw attention to the experience in Denmark. Throughout this crisis, the Government have acted on the best scientific and health advice, and that has clearly had to move over time. That advice has been challenged and questioned, and the Prime Minister and the Cabinet have made decisions based on the best advice available. Consequent to the health advice, which is clearly motivated to relieve as much pressure as possible on the NHS, there are other issues that we are dealing with urgently, and sequentially we are offering that advice as urgently as we can in different domains.
The hon. Gentleman asked about the Danish experience, and we are looking at the furlough system. We are looking at the proportion of support that is available, and we are also looking at the German system. In the last significant recession that happened in 2009-10—that is broadly the comparator that we could use—only 3% of German firms were helped. We are aware of what is happening in the US, and we are aware of the proposals that have been put forward by various think-tanks this morning. We are looking thoroughly at all those options, but it is very important that we have a system that delivers the support that is required to employers.
We have extended the coronavirus business interruption loan to up to £5 million. It is clear that there will be no interest payable in the first six months and no fees, and obviously we expect businesses to use that to support their employees during this time.
Several hon. Members rose—
Mr Speaker
To assist the House, I can say that I expect this to run until around 11.15.
Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)
I commend my hon. Friend and I agree with him—that is something that the Government should be moving on now, but there is something else the Government could do literally today. Universal credit has three basic levers that can all be pulled now enormously to help people who are in work. First, the taper could be lowered dramatically at this stage, which would push the floor right up underneath people in work at the moment, allowing them to fall back on that if employers cannot deal with them. Secondly, Ministers could change benefit rates, allowing a greater expanse of money to flow to claimants: that could be done today. The third area where my hon. Friend could act is to look at the waiting time and reduce that almost immediately. Those three things were always built into the system for flexibility and they can be done today. They can be delivered within days by a Department that already has the ability to do that while he gets on with the other facilities.
John Glen
I am grateful to my right hon. Friend, who has unrivalled experience in this area. He makes some very reasonable points, and we are looking very carefully at all the options. As I said earlier, when we have decided—very imminently—the Chancellor will make announcements to this House first.
David Linden (Glasgow East) (SNP)
In recent days, the Chancellor has already outlined support for business, which the SNP has welcomed. In Scotland, that support has been passed on in full by our Finance Secretary, Kate Forbes. However, I remain concerned that not enough support is being mobilised for sole traders, freelancers and the self-employed. Today though, our focus is rightly on people, many of whom are already self-isolating or moving to work from home, if indeed they can. But bills are still coming in and rent payments are being sought, and so I welcome the news that some support will be put in place, for example, for payment for energy bills. The question is who is eligible for that, and will that go far enough. Will the Government use the tax system to put thousands of pounds in people’s pockets by way of an emergency universal basic income? Will the Government extend statutory sick pay to the 2 million people who earn less than £118 a week and benchmark it to at least the real living wage?
Firms are already starting to make staff redundant, but we need to stem the flow of that immediately, and today. The Government should introduce a statutory retention scheme to provide firms with financial support to keep staff in employment during this uncertain time.
Now more than ever, our social security system needs to kick in. To protect families impacted by hardship and strengthen automatic stabilisers that support demands in the economy, does the Minister agree that the main adult rate of out of work support in universal credit and other benefits, including carer’s allowance, should rise by a third to £100 per week?
We are in the midst of a national emergency the likes of which I have never seen before. How this generation of politicians responds to the crisis will be how history judges us. During the financial crisis of 2008, no expense was spared to bail out the banks, so today with the coronavirus outbreak we must similarly be prepared to bail out household budgets at this time of economic crisis. It calls for us all to rise to the occasion.
John Glen
The hon. Gentleman is absolutely right. It is important that the Government do whatever it takes in these circumstances. He raises a number of specific points. He will be familiar with the changes we have made in terms of access to statutory sick pay and eligibility starting much sooner; that commenced from 13 March. He will be aware that, to make that easier, there is now no need to have a GP note. He makes number of points on universal credit and changing the eligibility there. Advances are available online; the minimum income floor has been temporarily released. He also makes a number of points about freelancers and the self-employed, which the Government are clear about.
The hon. Gentleman mentioned the universal basic income. The Government are looking at that, but the question whether it will help the most affected most urgently is one we have to consider. Many of us in this House, for example, would not require such support. We have to ensure that we target it at the most vulnerable.
Bob Stewart (Beckenham) (Con)
I have had a lot of emails on this subject, so may I ask the Minister again how the Government are going to support freelancers and the self-employed? They are desperately worried.
John Glen
My hon. and gallant Friend is right to raise that. We have changed the rules on access to employment support allowance and sick pay. It will depend on individual circumstances. We have also released funds to local authorities for hardship relief. Further advice on that will be given tomorrow by the Ministry of Housing, Communities and Local Government.
Stephen Timms (East Ham) (Lab)
I very much agree with the proposals just made by the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith). It is particularly important that the advances paid to people claiming universal credit become non-repayable for those affected by the crisis. The Minister mentioned the suspension of the minimum income floor for self-employed people—a welcome announcement made by the Chancellor in the Budget—but it appears to relate only to people who are directly affected by covid-19, whereas many of those suffering at the moment are not themselves ill but are affected by the wider changes in the economy. Will the Economic Secretary confirm that the lifting of the minimum income floor will apply also to those who are not directly affected? Will we know the details of the employment support package—I am glad the Government are working on that—before this weekend?
John Glen
The right hon. Gentleman makes some specific points essentially about the consequential effects on different groups of employees who are affected. I cannot comment on the details of that. As for the timing of the employment support announcement, we are working on it as quickly as we can. There is no timetable or specific date because we have got to get it right. We are working as urgently as possible, but I cannot tell him the precise moment at this point.
Sir Bernard Jenkin (Harwich and North Essex) (Con)
I commend my right hon. Friend the Member for Tunbridge Wells (Greg Clark) for his urgent question and endorse everything he said. Those of us who are not in the engine room of Government are being told by our constituents that, welcome though Tuesday’s package was, it is simply not going to be enough. When diehards such as my right hon. Friend the Member for Wokingham (John Redwood) and Allister Heath of The Daily Telegraph are lining up for far more radical measures than the Government have yet announced, the Government must take note. May I urge the Government to say something today to give people assurance that the help will come?
John Glen
I thank my right hon. Friend for his observations. He is right, but there is no sense that the Government are saying that what we have announced is the last announcement we are going to make. It is a question of making sure that when we announce measures, they will be effective in meeting the needs that we know exist. All of us, across the House, will have been inundated with emails from concerned individuals and businesses. We are taking that on board and acting as swiftly as we can. The points raised today are directly informing the nature of our response.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
I understand that this is very difficult for the Government and I am sympathetic, but this is about real people’s lives. The Treasury’s natural approach—being cautious and wanting to stress-test everything—is not appropriate in these circumstances. The right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) suggested some really good ideas. Why can they not just be implemented today?
John Glen
I understand the hon. Lady’s frustration. It is totally reasonable for Members of this House to be extremely concerned in the absence of the announcement, but it would be even worse, I would suggest, if we made ad hoc announcements when different Government Departments were not quite ready to implement those effectively. We are talking about an unprecedented crisis, and therefore we will need to take unprecedented measures. It is important that we do that as swiftly as possible, but it is also important that we do it as effectively as possible.
Nickie Aiken (Cities of London and Westminster) (Con)
I thank my hon. Friend for his recent announcements, and I absolutely understand that we are living in unprecedented times. In my constituency, hospitality and hotels are obviously huge employers. Is there any scope for the suspension of national insurance contributions, which would really help many of the chains, and particularly the smaller hotels? From speaking to those at the Goring hotel this week, I know that they are very concerned, and they are now offering their hotel to the Government for anything they need—for hospitals or for employees. Suspending NI contributions would be great.
John Glen
I thank my hon. Friend for her suggestions. Obviously, we have made a specific package of interventions available in the retail, leisure and hospitality sectors. We also have the grant facility at a high level for those sectors. She makes a reasonable point, and we will look at it—and we are looking at it—very carefully.
Sarah Olney (Richmond Park) (LD)
I was here on Tuesday night when the Chancellor made his statement, and there can be no doubt what the attitude of the House was at that time. It was that the package of loans and other measures announced by the Chancellor on that occasion would not be sufficient. It would not be sufficient for those who are relying on benefits, it would not be sufficient for those who are already finding themselves out of work, and it would not be sufficient for the self-employed. Here we are two days later, and the Minister is telling us that there simply has not been time to consider these things. This is urgent, and we really must have action now. Why is it taking so long?
John Glen
Every day, Ministers across all Departments are working on different aspects of the package. Yesterday my right hon. Friend the Housing, Communities and Local Government Secretary brought forward some measures for renters. We also have the three-month relief for mortgage holders where they need it, and for buy-to-let mortgage holders. There is more work being done urgently to give clarity on the elements that Members of the House are raising, but, as I said earlier, it is a question of making sure that when these measures are announced, they are going to be effective and can be delivered efficiently.
Peter Aldous (Waveney) (Con)
The feedback I am receiving is that many businesses will have difficulty in accessing Government loans because of restrictions they have in granting additional security to a new lender. With that in mind, may I urge the Government to support payroll costs far more directly, as other European Governments are doing? This is the way to avoid large-scale redundancies.
John Glen
My hon. Friend refers to the loans. I was meeting the banks last night to make sure that these loans are accessible. The criteria for issuing them are based on the solvency of businesses prior to this crisis arising. It is absolutely clear that the banks see they have a massive responsibility to make this scheme work. That term sheet is being finalised; it may already have been finalised this morning. The banks are now working on making sure that that will be available through all their call centres and branches. He makes the suggestion of a supplementary measure, and we are looking at these things very carefully.
Lilian Greenwood (Nottingham South) (Lab)
A constituent of mine works in a residential home for adults with learning disabilities. Her son’s school will be closed from Monday. She does not know whether she is considered a key worker, and even if she is, as seems obvious, her son has respiratory problems, so she is uncertain whether she wants to send him to school. Her employer says she will not be paid and is not even entitled to statutory sick pay if she cannot come into work because of childcare. What should she do? Where is the clear advice and guidance, and where is the helpline for the thousands of other constituents of mine and of every single Member in this House? Where can they get answers, because they are so worried?
John Glen
The hon. Lady makes a reasonable point about the concerns that are being raised. That is why the Cabinet Office will give further advice today on key workers and the support that will be given. I recognise that yesterday’s announcement on schools will be a significant disruption to the lives of many of our citizens. It is very important that we put in place urgently clarity about who is involved—who is designated in those categories—and the support that will be available. I will ensure that her point, which I am sure reflects the views of many, gets to the Cabinet Office after this session.
Dr Julian Lewis (New Forest East) (Con)
Given that the suggestions of my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) could be implemented so speedily, will the Minister undertake to try immediately after this session to get an answer on whether they should be implemented?
Tommy Sheppard (Edinburgh East) (SNP)
The very essence of the hospitality industry is to provide social contact. Does the Minister understand the real anger of many in that industry that the Government have given advice to their customers but not to them? If the Government believe premises should close, they should say so, and they should accept the consequences of paying people whose idleness is enforced because of a contribution to a public health emergency. What is so hard to understand is that the system for doing that is staring the Government in the face. It already exists. It is called Her Majesty’s Revenue and Customs. That is a system for taking money out of wage packets every month and giving it to the Government; now, it should be put into reverse to put money into the pockets of those employees.
John Glen
The hon. Gentleman is right to express the deep frustration of people in that sector, and I am sure his words resonate across the House. We have put in resources for 2,000 people from HMRC to take calls for bespoke solutions to deal with some of those issues. He is right that there is also an issue in terms of access to insurance. I was on a conference call with the insurance industry to clarify that where insurance has been taken out, that will be effective. However, he is perfectly right that more work needs to be done, and I have been very clear that more will be forthcoming imminently.
Joy Morrissey (Beaconsfield) (Con)
I thank the Minister for the measures that he has already taken to help the self-employed, but my constituency has the highest number of self-employed in the country, so will he elaborate on what tax incentives, or tax advice or support, can be given to the self-employed at this time, particularly during April over the end of the financial year?
John Glen
As I said to the hon. Member for Edinburgh East (Tommy Sheppard), people have access to an HMRC support line, which is properly manned and up and running. That should give them bespoke support for their circumstances. I have referred to the package of other measures that the Chancellor announced a few days ago.
Carolyn Harris (Swansea East) (Lab)
Charities such as Faith in Families in my constituency are really nervous that they will not be able to pay their wages. Without staff, they cannot deliver the projects for which they are applying for funding, which would provide food and childcare facilities in very deprived areas. That is necessary now; it will become essential in the future. What can the Government do to help those charities?
John Glen
The hon. Lady is right with respect to the role that charities play across our communities, binding communities together and working closely with local authorities. My colleague in the Ministry of Housing, Communities and Local Government is working on these matters, and we will make further announcements shortly.
Mr Tobias Ellwood (Bournemouth East) (Con)
I echo the calls for urgent support for British tourism, which I know the Minister will be familiar with in his constituency. In the Bournemouth area, tourism is worth more than £1 billion and directly employs 17,000 people. I received a letter from David Bailey, who is chair of the Bournemouth, Christchurch and Poole destination management board. He talks about lay-offs happening right now, as we speak, affecting the future of businesses. He asks whether it would be better if, rather than handing out benefit claims, the Government provided salaries immediately. That would mean the industry could retain the skills that will be needed to spearhead the economic recovery and would reduce the number of businesses that cease to trade. Will the Government consider that?
John Glen
My right hon. Friend makes some very reasonable points about the tourism sector just down the road from my constituency. The issue of what we do to support sectors that are directly and immediately affected by the action we have had to take will be at the front of our minds as we examine what employment support to put in place.
Clive Efford (Eltham) (Lab)
After six and a half weeks, when we knew we might reach this stage, it is hard to understand why the Government have no idea what they are going to do to pay the wages of those who are being laid off. A whole tranche of people are going to be laid off now, and more industries will lay people off next week and the week after. If the Government do not act now, they will not be able to retrieve the situation. How have we got to the point where the Government have not got a clue?
John Glen
I accept the hon. Gentleman’s frustration, but characterising the Government as not having a clue misrepresents the situation considerably. There are a large number of issues that we need to examine, and we are doing so at pace. We will make further announcements to address those that have been raised in the House today. We have sequentially done more by the day, reflecting the evolving nature of this crisis and the steps we have had to take, based on health and scientific advice. I understand that the hon. Gentleman is not happy with the Government’s announcements so far, but more will be coming.
Bob Blackman (Harrow East) (Con)
This weekend, pubs, clubs, restaurants and other retail outlets will be considering whether to close on an almost permanent basis, and the people employed in them have an uncertain future. However, most of them are relatively young and mobile, and they are able to offer help and assistance to the weak and vulnerable. Could we not guarantee loans to those outlets on the condition that those people continue to be paid and that they then become part of a volunteer force to help the weak and vulnerable at this time of crisis?
Nick Smith (Blaenau Gwent) (Lab)
I do wish Ministers would stop using hyperbole such as “whatever it takes”, when they do not follow through sufficiently quickly. Will the Government extend SSP to support all workers and pay it at the rate of the real living wage straightaway?
Mr Philip Hollobone (Kettering) (Con)
Many of the “just about managing” are not managing, and there will be many more of them in the next few days. The last thing we need at this time is an over-engineered new system. As a humble Back Bencher, I have heard many good ideas in the Chamber this morning—particularly from my right hon. Friends the Members for Chingford and Woodford Green (Sir Iain Duncan Smith) and for Tunbridge Wells (Greg Clark) and the right hon. Member for East Ham (Stephen Timms). If those three right hon. Members are not in No. 11 for a meeting later today, I will be really disappointed. We have had the architect of universal credit in the Chamber, and he has given the Government the answer to their problem. Please can we get a move on?
John Glen
I take the challenge from my hon. Friend in the spirit in which it was intended. There is no sense that the Treasury is trying to over-engineer anything. We are not trying to restrain spending for the sake of restraining it. We want to bring forward an effective package of measures that effectively meets the needs of the most vulnerable. My hon. Friend makes the reasonable point that a number of colleagues of great seniority have raised significant points of interest, and I will ensure that their contributions are heard at the heart of this process today.
Bambos Charalambous (Enfield, Southgate) (Lab)
Dental practices are at high risk of spreading coronavirus, yet there was nothing for them in the financial package on Tuesday, which means they have to stay open, with an increased risk of spreading coronavirus. Will the Government give assurances that they will cover fixed-price dental costs so that dentists can close and provide only urgent care?
Mark Pritchard (The Wrekin) (Con)
Many of the Government’s schemes have to be delivered through retail banks, which means people and businesses calling already overloaded call centres and going into retail branches—where they exist—which might restrict hours over the coming days. Most banks and most large private sector companies in this country that rely on some phone contact have resilience and contingency places dotted around the country that have pop-up call centres in times of crisis. Could the Government deploy those to ensure that desperate immediate-need calls from businesses and individuals are dealt with as quickly as possible?
John Glen
My hon. Friend makes a very good point about the resilience required in banks at this difficult time. I discussed that with the heads of the banks last night and over the previous two days. We need to ensure that the terms of these loans are effective in allowing people to access them swiftly and we need to ensure that the banks can ramp up the accessibility of their specialist advisers. I have been given assurances that that will be in place.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
So many of my constituents are caught up in this, like those of other hon. Members, and I have constituents who have no recourse to public funds, so when they are unable to work they cannot claim benefits. Many are freelancers and people who are self-employed and running small businesses. None of the packages the Government have announced help them so far. The Minister has had to be dragged here to answer an urgent question and has nothing he can say that will comfort our constituents. I think we all recognise that it is difficult, but could he not even give us a clue about the general direction of thinking from the Government? Will he raise the local housing allowance? Will the Government ensure that those with no recourse to public funds get funded? Will they stop this ridiculous loan system, which will never get paid back? Businesses will go bankrupt before they can pay it, and they are laying off staff now.
John Glen
The hon. Lady raises a number of sensible points. We are looking at many of them. I reassure her that we will make further announcements very soon. Yes, we are looking at the ideas raised. We are looking at other jurisdictions. But in some cases we have a very different set of processes and IT systems behind some of these Government Department distribution mechanisms. I know that that is very technical, but the bottom line is that we need to ensure that when we introduce something, it delivers.
Bob Seely (Isle of Wight) (Con)
I support strongly the ideas on the universal employment retention package proposed by several right hon. Friends, and I hope that the Government take it on board to prevent a health crisis becoming an economic disaster. In addition, briefly, rateable value capped at £51,000 is too low for medium-sized tourism employers such as the Seaview Hotel. Secondly, we need clarity in the system because my chamber of commerce still does not know how to apply. Thirdly, we need a package for the voluntary sector. West Wight sports centre is a world-leading sailing academy and a major employer on my patch. We need either a voluntary sector package or a universal employment retention programme.
John Glen
I thank my hon. Friend for his points; he raises a number of interesting ideas. He is absolutely right about the voluntary sector needing support. As I have indicated, there will be a package coming and different Departments are working together to make this as effective and comprehensive as possible. His constituency has a number of issues regarding the hospitality and leisure sector, and I am very aware of the representations he has been making to Government over the previous few days.
Bill Esterson (Sefton Central) (Lab)
Letting many people get into rent or mortgage arrears or asking businesses to take on debt are not the answers. They are just going to make the crisis worse—[Hon. Members: “And longer.”] Yes, thank you. Every business, every employee, every self-employed person and everybody in the third sector needs to know that their living costs will be covered. The Government need to show the urgency that the Minister talks about and they need to show it today. Will the Chancellor come back today and make a statement on how they will deliver this?
John Glen
The hon. Gentleman is perfectly right that we need a comprehensive package that deals with businesses, the voluntary sector and individual employees of different categories. We are looking very carefully at the best way to do that, in addition to the significant package of measures we have introduced. I feel his frustration and I will take all these points back and make sure that they are addressed.
Richard Graham (Gloucester) (Con)
The greatest difficulty for the Government in this fast-deteriorating situation of no one’s making is the speed of response. My worry is that the business interruption loans package will be too clunky for most small and medium-sized businesses, and the cash grants will take too long to get to businesses before decisions are made about jobs. Will the Minister look closely at the recommendation of our right hon. Friend the Member for Tunbridge Wells (Greg Clark)? If that were put in place, some of the recommendations made by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) on universal credit would not be so important.
John Glen
I note the point that my hon. Friend makes about the clunkiness of existing measures, and obviously we are looking at the point raised by my right hon. Friend the Member for Tunbridge Wells. My hon. Friend the Member for Gloucester (Richard Graham) refers to the accessibility of the loans. The Government guarantee to the banks through the British Business Bank is in order to provide a massive incentive to making the loans available to solvent businesses as quickly as possible, but I hear his concerns, and they are reflected in the design and in conversations that we are having with the banks.
Patrick Grady (Glasgow North) (SNP)
Does the Minister not understand that a universal minimum income guarantee does exactly what it says on the tin? It will provide that minimum level playing field for tenants and their landlords, for business owners and their employees; it will provide everyone with a minimum level of assurance so that they can have some certainty in this time of uncertainty.
Anthony Mangnall (Totnes) (Con)
Like many Members, I have been fielding calls for the past 10 days from businesses that are sitting on the wire, wondering whether their futures are safeguarded. Has the Minister looked at the possibility of a VAT rebate for businesses that are desperately trying to hold on to their employees to ensure that they have a future? Will he please look into that, and will he also ensure that we have greater clarification of whether pubs are open or closed, because that is causing much greater distress than it needs to cause?
John Glen
My hon. Friend makes a reasonable point about the hospitality sector, and a very credible suggestion with respect to VAT. Across the benefits system and the tax system, we are looking at the optimisation of interventions to support the most vulnerable and most affected at this time, and to give reassurance to the whole country. We will urgently bring forward measures to address the concerns that he has raised.
Mr Kevan Jones (North Durham) (Lab)
Individuals are losing their jobs now—they are in desperate need now. Andrew Brown, a freelance graphic designer in my constituency, contacted me this morning; his business has folded overnight, and he cannot apply for any grants because he works from home. What does he do in that situation? The Minister talks about the great package that was announced the other night, but councils still do not have the guidance to get that money out to businesses. I urge him to get that out as a matter of urgency, because this morning Durham County Council told me that it will not be available until the weekend, and that is too late.
Several hon. Members rose—
Rob Butler (Aylesbury) (Con)
There are more micro-businesses in Buckinghamshire than in any other county in the country. I pay tribute to Buckinghamshire Business First, which is working extremely hard to try to support them, but may I urge my hon. Friend to take the unique needs of micro-businesses into account in the measures that he is developing?
Deidre Brock (Edinburgh North and Leith) (SNP)
Our farmers, crofters and fishers are crucially producing our food, but the situation has rocked those sectors to their foundations. Will the Minister outline what specific considerations are being given to supporting those sectors, so that they can continue their vital work?
John Glen
The hon. Lady will know that a large number of the grants and loans schemes will be accessible to all sectors, as well as grants from the local authority. Comprehensive advice went out to all hon. Members last night setting out all that information, and there will be further announcements. Sector-specific issues are best addressed through the Department for Environment, Food and Rural Affairs, but I hope the announcements that we have made will give some interim comfort to her constituents at this difficult time.
Matt Western (Warwick and Leamington) (Lab)
I am afraid that it is quite evident that the Government have lost support and confidence across the Chamber, and that is echoed by the markets. We have seen a 5% drop in sterling, which will translate into higher food and energy prices for already hard-pressed households. In Warwick and Leamington, we are losing jobs and good businesses. Will the Minister support the comments of the right hon. Members for Chingford and Woodford Green (Sir Iain Duncan Smith) and for Tunbridge Wells (Greg Clark) and introduce some form of universal income support to restore both the supply and demand side?
John Glen
I acknowledge the point on the minimum income guarantee, which I have responded to previously. On co-ordination with the Bank of England, we have worked with the Financial Conduct Authority to introduce better forbearance measures for the banks so that they can act effectively and use their flexibilities. Obviously the bridging facility that the Bank of England has brought forward for bigger businesses is also important.
Ben Lake (Ceredigion) (PC)
Will the Minister assure us that the package of measures that the Government intend to bring forward will offer support to the self-employed, sole traders and freelancers who may not themselves be ill but who may have already lost work due to the economic disruption of covid-19?
Kate Green (Stretford and Urmston) (Lab)
May I raise a specific question with the Minister? Childminders and childcare providers in my constituency tell me that, although they have insurance if they have to close their businesses as a result of a notifiable disease, which covid-19 clearly now is, insurance companies are saying that they will not provide the cover, because it does not appear on the list of notifiable diseases. Will the Minister take that up urgently with the industry?
John Glen
I have taken that up urgently with the industry. Businesses take out business relief, and then about 5% take out insurance for non-specified diseases, and 5% for specified diseases. We have made sure that for those that have taken insurance for specified diseases, that will be triggered by the Government’s announcement this week, and the other package of measures will support businesses that do not have that insurance. We cannot retrofit contractual obligations to insurance companies.
Kevin Brennan (Cardiff West) (Lab)
The Minister is a decent man, but there is a feeling across the Chamber that Treasury Ministers, and the Chancellor in particular, find it difficult to empathise with the situation that people find themselves in and do not speak human very well. I appeal to Ministers to show a bit more understanding of the predicament facing freelancers and the self-employed who have lost all their work, and perhaps take on board simple ideas, such as that of the right hon. Member for Tunbridge Wells (Greg Clark). Reverse the polarity—it usually works.
John Glen
I am sorry that the hon. Gentleman wishes to criticise the tone of my response. I am clear that this is an unprecedented crisis. The Government have made a series of announcements, and will be making further announcements. A range of sensible suggestions have been made, many of which we are already examining urgently.
In response to specific questions about technical matters, I have had to use quite complex and unfamiliar constructions. If I did not do that, I would not be answering the question. If I used too many soundbites, I would be criticised in another way. We will do everything we can to take on board the questions that have been raised today to come forward with a comprehensive package that all our constituents will see as effective.
Daisy Cooper (St Albans) (LD)
I asked the Government 10 days ago whether they would guarantee the wages, rents and business rates of small businesses. The measures that have been announced are riddled with problems. Businesses in St Albans tell me that they do not qualify for the secured loans or the grants up to £25,000, and they are being told that business interruption insurance will be payable only after the event when the insurance company can see how much they have lost. That is not good enough. Businesses are saying that Her Majesty’s Revenue and Customs must be used, not the benefits system; that they need grants, not loans; and that wages for all must be guaranteed, and guaranteed today.
Kerry McCarthy (Bristol East) (Lab)
Can I ask about people who use registered childminders who now will not be able to do so? Quite understandably, childminders are still asking for the fees, because otherwise they will be short. We now have people who cannot go to work because they have to look after their children, but if they are self-employed, they cannot get money either. What support is available to help them?
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Can I say to the Minister as constructively as possible that his Government’s economic response is undermining the public health response? Job losses are contagious. Fear of economic hardship will spread the virus. The technical details can wait, but he needs to say now—today—that in principle he will guarantee the incomes of everyone at a level that provides security.
John Glen
We will do what it takes to support workers who are in distress. We have brought forward a package of measures, some of which will be imminently delivered, such as the unprecedented loan scheme. We have also added a number of grant schemes available through local authorities and reliefs from business rates, and additional measures will be coming imminently.
Neale Hanvey (Kirkcaldy and Cowdenbeath) (Ind)
The Links market is the largest street fair in Europe and has been happening every spring for the last 700 years in Kirkcaldy. Unfortunately, as a result of coronavirus, the Scottish section of the Showmen’s Guild of Great Britain has had to take the reluctant decision to postpone the event this year. That is going to cause significant hardship for their members. It will also have a significant impact on the local economy because it attracts many visitors. What support will be available to get them through this difficult time and preserve their important fair?
John Glen
The hon. Gentleman highlights what many colleagues are going to experience: events that have been planned and have been going on for many, many decades will be cancelled as a result of what is happening. The package of measures that we have announced will be accessible to many of those people. The sectors that are involved will sometimes have sector-specific packages, where there has been a direct effect as a consequence of Government decisions, and we are urgently working on a broader package with respect to employees.
Thangam Debbonaire (Bristol West) (Lab)
I am sure that the Minister will have heard the cross-party consensus here. If the hon. Member for Harwich and North Essex (Sir Bernard Jenkin) and I are in complete agreement, something is happening, so on behalf of the 130,000 people of Bristol West, I plead with him to take every single one of these suggestions straight back to the Treasury and to put them into practice today.
Dave Doogan (Angus) (SNP)
The Minister is very keen to point out that he understands the frustration of Members and their constituents. Can I assist him by pointing out that it is no longer frustration, but desperation? What we need are not loans; we need grants. Businesses in Angus are asking me why they should take out a loan to provide incomes for people who cannot work, through no fault of their own. That looks dangerously like welfare, and delivering welfare is the responsibility of Government. When will the Government deliver?
John Glen
I understand the use of the word “desperation”—I recognise that, and that is why we are working urgently to have a package of measures, and extend that package of measures, so that there are a range of options to businesses of different sizes in different situations, based on their sector and the risks that they face.
Jim Shannon (Strangford) (DUP)
The first coronavirus death has been confirmed in Northern Ireland, and I wish, through the House, to convey our commiserations to the family.
I have been contacted by a school bus driver on a zero-hours contract who normally works 45 hours a week but has now been told that there is no work for him until further notice. Does his employer not have an obligation to pay his wages, and the wages of others in the same boat? What is the Minister’s message to help this employee?
John Glen
I am very happy to look at that individual’s circumstance. We have made interventions to provide advances of ESA and to remove the minimum income floor. It is clear that we will need to do more to support employees who have been specifically affected by the tough decisions we have taken. I am very sorry to hear of the first death in Northern Ireland.
Windrush Lessons Learned Review
(4 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for the Home Department (Priti Patel)
With permission, Mr Speaker, I will make a statement on the long-awaited Windrush lessons learned review.
I dedicate this statement to the Windrush generation. I have personally been deeply moved by reading this report. Given the national significance of this issue, I have published the review immediately. I thank Wendy Williams and her team for the important work they have undertaken.
The Windrush lessons learned review gives voice to members of the Windrush generation who legally arrived in the UK to help rebuild post-war Britain. These men and women built their lives and their home in Britain. These people have done so much for this country, from staffing the NHS to rebuilding Britain. These are the very people who worked hard, paid their taxes and had every right to be in this country.
They contributed to our communities, culture and society, helping our public services and our economy to thrive. They made our country stronger, more vibrant and more successful as a nation. That is why we were all shocked to discover that they and their families were subject to such insensitive treatment by the very country they called home.
As this review makes clear, some members of the Windrush generation suffered terrible injustices, spurred by institutional failings, spanning successive Governments over several decades. That includes
“ignorance and thoughtlessness towards the…race and the history of the Windrush generation”.
Today’s publication is part of an ongoing mission to put this right and ensure such events can never happen again, as there were far too many victims of Windrush.
Paulette Wilson was detained in an immigration removal centre and warned that she faced removal after living in the UK for 50 years. She spent decades contributing to the UK—working for a time in this very House—yet she was treated like a second-class citizen.
Junior Green had been in the UK for more than 60 years, raising children and grandchildren here, but after a holiday to Jamaica he was refused re-entry despite holding a passport confirming his right to be in the UK. The injustice he suffered was compounded when, because of this action, he missed his mother’s funeral.
Lives were ruined and families were torn apart. Now, an independent review has suggested that the Home Office’s
“institutional ignorance and thoughtlessness towards the issue of race and the history of the Windrush generation”
contributed to it. This is simply unacceptable.
I have heard people speak of the decision making as a process that grinds people down to the extent that it makes them want to give up. I have heard people speak of being dismissed, and being labelled as a group of people who just do not matter and whose voice on this issue is irrelevant.
People have spoken to me of the indignity and inhumanity they still feel today following the experience of being made to feel unwelcome in their own country. They have described their experiences as unthinkable and unimaginable. However, there are people across the UK and even some Members of this House—including myself and the shadow Home Secretary—for whom this is unfortunately all too relatable.
There are lessons to learn for the Home Office, but also for society as a whole. Despite the diverse and open nature of our country, too many people still feel that they may be treated differently because of who they are or where their parents came from. Today’s report, which suggests that in the Home Office there was an
“institutional ignorance and thoughtlessness towards the issue of race and the history of the Windrush generation”
is worrying for us all.
In her report, Wendy Williams is clear that lessons must be learned at all levels and by all political parties. She describes a set of measures that evolved under Labour, coalition and Conservative Governments. Those measures cover decades. She states that Ministers did not sufficiently question unintended consequences and that officials should and could have done more. We must all look to ourselves. We must all do better at walking in other people’s shoes. We must all take responsibility for the failings that led to the unimaginable suffering of this generation.
Let me be clear, Mr Speaker. Nothing I can say today will undo the pain, suffering and misery inflicted on the Windrush generation. What I can do is say that on behalf of this and successive Governments, I am truly sorry for the actions that spanned decades. I am sorry that people’s trust has been betrayed. We will continue to do everything possible to ensure that the Home Office protects, supports and listens to every single part of the community it serves.
Action has already begun. In recent months, I have met and listened to people whose lives were shattered. Since 2018, we have launched measures to put right the wrongs caused to individual members of the Windrush generation. We have taken action through practical measures to give those affected the assistance, certainty, reassurance and support they need. The Commonwealth citizens taskforce goes into communities to help and support people secure their legal status. More than 11,700 people have been granted a form of documentation that confirms their right to remain in the UK and guarantees their access to public services. Our vulnerable persons team has provided support to nearly 1,400 people, with approximately 120 people still receiving support. The team has supported more than 360 people to secure access to benefits.
To go some way in addressing the hardship suffered, the Home Office launched the Windrush compensation scheme. The scheme was designed in close consultation with members of the community and Martin Forde QC. Collectively, they have developed a compensation scheme that is straightforward to use and addresses the bespoke personal circumstances and needs of every applicant, with dedicated caseworkers assessing claims as quickly as possible. There is no cap on payments, dozens of which have already been made, and we encourage more applications. Those who are eligible will receive full compensation.
More than 100 community events have taken place so far. That includes more than 30 compensation scheme events across the country, from Southampton to Glasgow and Cardiff to Coventry. However, there are still people out there in need of our help who we have not yet reached. That is why in February, I extended the length of the compensation scheme by a further two years so that claims can be submitted until April 2023. I set up the Windrush stakeholder advisory group to rebuild links with communities to ensure that they are supported through compensation, but also to rebuild the trust that has been broken.
Today, I can confirm we will launch an expanded cross-Government Windrush working group to develop programmes to improve the lives of those affected. That may be through employment programmes, dedicated mental health support and specialist education and training schemes. To ensure that people know about the taskforce, the Windrush compensation scheme will have a dedicated communications campaign promoting the scheme. We will also open a £500,000 fund for grassroots organisations to promote these schemes, including provisions for specialist advice services. I would like to extend my personal thanks to Martin Forde QC for his support with the creation of the scheme.
I want to put on record my thanks to my predecessors—my right hon. Friends the Members for Bromsgrove (Sajid Javid) and for Maidenhead (Mrs May), and the former Member for Hastings and Rye—who worked hard to understand and undo the suffering when these issues first came to light, and other Members, including the right hon. Members for Tottenham (Mr Lammy) and for Normanton, Pontefract and Castleford (Yvette Cooper), who shone a necessary light on this injustice. I also want to thank the thousands of civil servants at the Home Office and across Government who work tirelessly every single day in challenging and demanding jobs to keep the public and our country safe. Whether on the frontline or working to develop policies for the future, their commitment to create a safer country for us all is commendable.
Since these injustices were brought to light, civil servants have used every endeavour to right the wrongs, giving people their correct status and supporting them in their financial compensation claims. However, it would be wrong for the Department to ignore Wendy Williams’s finding that the Home Office’s
“institutional ignorance and thoughtlessness towards the issue of race and the history of the Windrush generation”
contributed to this. This is not something that can be resolved with an apology or compensation.
I will review the recommendations that Wendy Williams makes in relation to the way the Home Office operates as an organisation. I will continue to look closely at its leadership, culture, practices and the way it views the communities it serves. Over the coming months, myself and Matthew Rycroft—the new permanent secretary—and the second permanent secretary will work together with our dedicated staff at all levels to reflect on the recommendations, including those relating to compliant environment policies and cultural change. Fundamentally, I want to make the Home Office a better place to work. That will include a clarification of the Department’s purpose, mission and values, putting at its heart fairness, dignity and respect. We will put people before process.
The publication of this review is a small but vital step towards ensuring that the Home Office is trusted by all the people it serves. I encourage anyone who thinks that they have been affected by the Windrush scandal or who requires support or assistance to come forward. I will bring forward a detailed formal response in the next six months, as Wendy Williams has recommended, representing a new chapter for the Home Office. Let me assure the House that everyone at the Home Office will be asking the difficult questions needed to ensure that these circumstances can never arise again. I commend this statement to the House.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
We meet as a House of Commons at a time of unprecedented national crisis—a national crisis that none of us has seen before in our lifetime—but I am sure the Home Secretary will agree that we should not allow the fact that the review has been published at a time of national crisis to mean that the review and its recommendations are buried. The Windrush generation deserve better than that.
As the Home Secretary will know, the recommendations in this review have three main elements: that the Home Office must acknowledge the wrong that has been done; that it must open itself up to external scrutiny; and that it must change its culture, to recognise that migration and wider Home Office policy is about people, and whatever the objective, it should always be rooted in humanity.
The Home Secretary will be aware that the review points out:
“Some ministers and senior officials spoken to in the course of this review do not appear to accept the full extent of the injustice done to the Windrush generation”,
and that they say
“the situation was unforeseen, unforeseeable and therefore unavoidable.”
More than one Member of this House foresaw the consequences of the hostile environment legislation years ago.
The review goes on to say that other Ministers and senior officials
“have expressed the view that the responsibility really lay with the Windrush generation themselves to sort out their status.”
Will the Home Secretary agree that, whichever politicians or officials said those things—Wendy Williams quotes them in the review—they were disgraceful things to say?
The review has many important and detailed recommendations. I cannot touch on them all, but I wish to draw the Home Secretary’s attention to a few. The review wants the Department to publish a comprehensive improvement plan within six months. Is the Home Secretary willing to assure the House that there will be such a plan? The review asks that the Home Office run a programme of reconciliation events with members of the Windrush generation. Does the Home Secretary commit to that?
Very importantly, the review says that the Home Office must look beyond the Caribbean, because persons from all over the Commonwealth who came to this country at that time would have been caught up in the same issues that the Windrush generation were caught up in. In fact, persons from the Caribbean are as anxious as anybody that persons from other parts of the Commonwealth—Africa, south Asia—also get the fairness and justice that they deserve. Is the Home Secretary willing to commit to reviewing data on other Commonwealth cases, as well as those from the Caribbean nations?
Is the Home Secretary willing to commit commission officials to undertake a full review and evaluation of the hostile or compliant environment policy and its measures individually and serially? Such a full review should assess whether they were effective and proportionate. Given the risks inherent in the policy that are set out in the report, the review must be carried out scrupulously, designed in partnership with external experts and published in a timely way.
Sadly, the Home Secretary did not feel able to share a copy of the review with the Opposition Front-Bench team. I have never before been in the situation in which a Home Secretary brought forward a major report of this kind and did not want to share it with the Opposition Front-Bench team—obviously that would have been under complete discretion. As it happens, I had to go into the Home Secretary’s office in Parliament to obtain the copy I have. It is almost as if the Home Secretary did not want full parliamentary scrutiny.
This is a detailed report that deserves detailed scrutiny. It is coming forward at a very difficult time for the nation as a whole, but the Opposition will be coming back to the issues raised in the report, because the Windrush scandal was not just a mistake; it was not just something that happened because people did not read the rules properly. As Wendy Williams points out, it was rooted in the systemic culture of the Home Office and the failure of Ministers to listen to the warnings they were given about what the effects of the hostile environment could be on people perfectly legally entitled to be here.
I have heard the Home Secretary’s apology, but people will believe her apology when they see her genuinely seek to implement the recommendations in this review. My mother was a member of the Windrush generation, so I know that one of the aspects of the Windrush generation was that they really believed they were British. They had no reason not to believe that they were British when they came here with their passports, UK and Colonies.
Let me assure the Home Secretary that, for the Windrush generation, it is not necessarily the money, or the loss, or the inconvenience, or even the tragedy of being deported. It is the insult to people who always believed that they were British, and who came here to rebuild this country, but who, because of the insensitivity and the structural issues in the Home Office, were treated in an utterly disgraceful and humiliating way. The Home Secretary should be assured that we will return to these issues until the Windrush generation gets the justice to which it is entitled.
Priti Patel
First of all, let me say in response to the right hon. Lady’s point about the publication of the review that this is an independent review. I received a copy of it yesterday from Wendy Williams and I have, through all the due process in the House, laid the review this morning, in a timely way, in the Vote Office, using all the procedural routes that are normal to this House. I know that the right hon. Lady came to my office and picked up a copy, but copies were also available earlier on this morning—we checked that, and as she knows, I also gave her sight of my statement earlier, prior to coming to the Chamber.
I made a commitment to publish the report as soon as possible. It came to me yesterday, and I have done that, primarily because of the nature of the response and the concerns that this House has consistently and rightly raised when it comes to the Windrush generation. That, in my view, was the right thing to do, and I would not have been able to publish the review any earlier, because obviously it came to me from Wendy Williams yesterday. The timing of the report was decided by Wendy Williams, as the independent reviewer. Let me assure the right hon. Lady that I discussed with Wendy Williams yesterday how I will work with her on the recommendations going forward. I will be doing that over the coming months, in the way in which Wendy has asked and alluded to in the report. I will ensure that this issue continues to get the national prominence that it rightly deserves.
I also think, on that point, that this is the time for us all across this House to come together to right the wrongs. I have made it clear in my statement already that not only will I review Wendy’s recommendations on how the Home Office operates as an organisation, looking closely at, yes, the leadership, the culture, the practices and how it needs to put people before process—I cannot emphasise that enough—but I will also look at how we review policies and cultural change going forward. That is absolutely the right thing to do, but I emphasise that, in many of the measures and recommendations, and in the extent of the review—I have no doubt that when the right hon. Lady has the opportunity she will go through the review and read it, as I have—Wendy Williams is very clear that lessons must be learned at all levels, by all political parties. She describes the set of measures that evolved under Labour, coalition and Conservative Governments, and is clear those are lessons that we should all be learning, as politicians and as society, but also as Members of this House.
Mrs Theresa May (Maidenhead) (Con)
May I first associate myself with the unqualified apology that the Home Secretary has given to the Windrush generation? I have given my own apology previously, but I do so again today. This generation came here, they were British, they were here legally, they worked to build our country and they should not have been treated in this way. I recognise the commitment that my right hon. Friend has given to ensuring that the Home Office learns the lessons set out in the review.
May I draw my right hon. Friend’s attention to one of the elements that she referred to in her statement? Wendy Williams says in her review that
“a lack of insight into the community’s experience did delay an understanding of the problems being faced by the Windrush generation and led to opportunities being missed for resolving cases sooner.”
The Home Secretary referred to the fact that too many people still feel that they may be treated differently because of who they are or where their parents came from. Against that background, does she agree that the work of the race disparity audit, which I set up when I was Prime Minister, is absolutely critical in relation to this, and not just that that work should continue, but that every Department should act on the failings and the gaps in public sector provision for certain communities that are highlighted by that audit?
Priti Patel
I thank my right hon. Friend the Member for Maidenhead (Mrs May) for her thoughtful comment. I emphasise and echo the work that she has done, but acknowledge her apology as well. She is absolutely right about the role of the race disparity audit. There is much that we can all take from this review. We should all as individuals be more conscious and aware not just of how we engage people, but of how we reach an understanding of communities and cultures, to help us all and to inform decision making and policies across Government in the future.
Kenny MacAskill (East Lothian) (SNP)
This is a welcome statement and a welcome start, but it is only a start. The old maxim applies: legislate in haste, repent at leisure. The tragedy is that the price paid by some is significant and the actions of Government have been shameful, so an apology is both right and overdue. I recall as Justice Secretary of Scotland meeting a gentleman in his late 40s or 50s who, as a babe in arms, had left Scotland and gone to Australia. All his family and friends were in Australia. He had fallen from grace, developed an alcohol problem, committed a crime and been deported. I said then that the actions of the Government of Australia were shameful, and I repeat now that I believe the behaviour and actions of the UK Government are equally shameful when they replicate that. That gentleman was Australian, despite the passport he carried.
Will the Home Secretary ensure that those members of the Windrush generation who have been deported and who possess a different passport from the one that we in this Chamber have, but who are UK citizens the same as we are, are allowed to return? Will she also ensure that offenders from abroad who must be deported are rightly sent home, but that who possess a passport from Jamaica, Nigeria or wherever else, who have grown up in this country and are UK citizens, should be entitled to those rights?
Equally, although I believe the commitment to implement the recommendations is wholehearted and sincere, it is more than just a matter of living up to the recommendations; it must reflect the spirit of Wendy Williams’ report. I ask that the Government take on board those two points.
Priti Patel
I would like to make a number of points in response to the hon. Gentleman’s comments. First, he has already spoken to me about reviewing the recommendations, but I opened my statement by saying that I was deeply moved by reading the report, and I suggest that he too gives it some consideration and looks at the many recommendations made. In particular, I referenced the fact that we still have work to do in reaching members of the community, and I called for other individuals who feel that they have been affected to come forward, so that we can secure their status and provide the compensation that may be due to them.
There is something more fundamental, though. No amount of compensation or any process now can resolve the injustices that have happened. My focus right now is fundamentally not only to ensure that the recommendations are reviewed and undertaken, but to work with colleagues and Wendy Williams to ensure that we do this in the right way to bring about the change that we all want to see.
Bob Blackman (Harrow East) (Con)
I commend my right hon. Friend for her statement and for the apology she has given. The reality is that the Windrush generation, when they arrived here, were met with racism and outright hostility. That they have been treated so badly after so many years of service to this country is an absolute disgrace and a stain on our society. Will my right hon. Friend say a little more about what she can do to reach out to people who have been deported, or who are outside this country and wish to return but are not covered at the moment by what the Home Office is doing, so that they too can receive justice in the right way?
Priti Patel
My hon. Friend is absolutely right in his reflective remarks about the citizens who came to our country legally, in effect to rebuild our nation and join our public services. For many decades, that generation experienced great hostility and overt racism in our country. As much as our country has moved forward, made progress and changed, as I said, there much that we need to do and we must all look at ourselves. He is also right to highlight people of other nationalities—citizens of Commonwealth countries in particular. The shadow Home Secretary also referred to Commonwealth citizens who were caught up in this. I know the report speaks very much about the Windrush generation—people who originated in Caribbean communities—but many other people from Commonwealth countries have been affected. As part of our work in the Home Office, we will of course endeavour to reach out through our engagement programmes to individuals from Commonwealth countries too.
Mr David Lammy (Tottenham) (Lab)
Wendy Williams’ Windrush lessons learned review is a brutal indictment of the Home Office, which shows that it is wholly unfit for the society it is supposed to serve. The review states that the Home Office displayed “institutional ignorance and thoughtlessness” on race issues that is
“consistent with some elements of the definition of institutional racism.”
The review accuses the Home Office of having a “defensive culture” that makes it deaf to those raising genuine concerns. Will the Home Secretary accept today, in this House, that, as was said previously, this was not a mistake or an accident, but a systemic pattern of appalling behaviour, rooted in a toxic internal culture and a failure of the Department to understand Britain’s colonial history?
Will the Home Secretary commit at the Dispatch Box to implement every single recommendation in this review? Will she review the £62,000 that has been paid out to those who should be compensated by far more? Will she ensure, at the Dispatch Box today, that she will end the hostile environment, which amplified things and has brought this about? The report asks for contrition and genuine understanding. We will hold her to account and to her word that that contrition is genuine, so that we right these shameful wrongs.
Priti Patel
I would urge the right hon. Gentleman to work with us all, collectively, to right these wrongs. I have been clear in my statement today, not just in giving an unequivocal apology, but in highlighting, as Wendy Williams has in an incredibly moving and thoughtful way, many of the issues that have led to the 30 recommendations she has made in this review. I will come back to the House and give all the recommendations full consideration.
The right hon. Gentleman has heard me say, and I have made this commitment to Wendy Williams, that I will work with her on reviewing the recommendations. That is the right thing to do. It is the right way to prevent something such as this from ever happening again.
The right hon. Gentleman also asked me about the culture within the Home Office. I have been clear that I am going to review all aspects of the Home Office. I will continue to look at the leadership, and at the changes we need to make to the culture and to policies; I have been clear about that in my statement. I will absolutely come back to the House, once I have worked with Wendy Williams, and share the details of how we will proceed as a Department in picking up the recommendations in this lessons learned review.
Gareth Bacon (Orpington) (Con)
My right hon. Friend has disclosed that the first time she received this was report was yesterday and that she published it at the earliest possible opportunity today. Will she also disclose when officials at the Home Office first had sight of this report?
Priti Patel
My hon. Friend is right to say that I received the report yesterday and, such is its importance, I published it today. Last July, Wendy Williams began the representations in the Maxwellisation process; those officials who have been involved and engaged in this process did not have sight of the actual review or report, because obviously it has taken time for that to come together, but there has been ongoing work and dialogue with key officials, former Ministers and many other interviewees Wendy has worked with for the publication of this review. That has taken place over a long period of time.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
This report is deeply disturbing, but it also tells us many of the things we have been raising concerns about since the Windrush crisis emerged. The result of it is that British citizens have been deported, been denied NHS treatment, been cost their jobs and been made homeless by the actions of the British Government, who act in all of our names. So all of us should be deeply ashamed by what has happened to the Windrush generation and determined that this should never happen again; the conclusions on racism are particularly damning. The Home Secretary will know that consecutive Home Affairs Committee reports, and reports from previous Committees as well, have often raised many of the concerns embedded in this report: concerns about the hostile environment; about the casework culture— the culture of disbelief; about the net migration target; and about a series of problems within the Home Office, but they have not had an impact. Some of the most damning conclusions in Wendy Williams’ report are that this was foreseeable and avoidable and that, since the Windrush crisis broke, the action that has been taken has been dealing only with the symptoms and not the causes. Will she therefore urgently agree to accept all the recommendations about scrutiny and openness in the Home Office, so that she can prove to Parliament that she is, in fact, going to make the fundamental changes that are needed?
Priti Patel
The right hon. Lady is right in her identification of the issues that existed over a period of time—Wendy Williams was also very clear about them in her review. Over several decades, and under successive Governments, those policies were part of the culture and the environment of the Home Office. I am clear that I will review all the recommendations, and I will work with Wendy. There may be recommendations that I can proceed with sooner rather than later, and I am absolutely committed to doing that, because there are structural and cultural issues at the heart of this. They are so self-evident in this report that no one can sit back and digest them lightly, or close their eyes and ears to many of the challenges and to some of the deeply moving points that have been made. I will come back to the House on this, but I will work absolutely vigorously with Wendy to look at every single recommendation and consider which ones we can proceed with at pace and very soon.
Several hon. Members rose—
Bob Stewart (Beckenham) (Con)
As someone who has served in the military with soldiers from the Windrush generation, may I say that we never once thought of them as anything other than British? We looked in their eyes, and the eyes that looked back were British to the bone.
Priti Patel
I thank my hon. Friend for his comment. This review gives voice to people from the Windrush generation, who, of course, not only came to the UK legally, but were part of our country. They contributed to our country, our economy and our public services in an unprecedented way.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The Home Secretary has said, “We will continue to do everything possible to ensure that the Home Office protects, supports and listens to every single part of the community it serves.” I commend the work of Councillor Carole Williams in Hackney, who is doing amazing work, pulling together the community and setting a better model than the Home Office’s for how that engagement could work.
I also want to ask the Home Secretary about the other 160,000 Commonwealth citizens in this situation, which is something that the Public Accounts Committee raised. While she is on her feet, will she also tell us what she is doing about people with no recourse to public funds who are part of the community she serves, who will be facing very difficult circumstances if they are unable to work because of covid-19?
Priti Patel
The hon. Lady raises a number of points. First, I thank everyone who is involved, and has been involved, in many of the outreach groups and the events that have taken place across the country. I have mentioned the stakeholder group in particular, which is something that I set up. I have spent a lot of time with volunteers and community activists, and their work has been remarkable and should be commended. There is much more that we need to do on that basis, and that equally applies to members of other Commonwealth countries. This report is very clear about that, and I am very clear about that as well. I said in my statement that we have not done enough yet to reach out to everyone, and that there is a lot of work to do in reaching out to other individuals and communities. I have asked other colleagues and Members of this House to work with us and their communities so that we can ensure that we reach the people who need help and support. That goes exactly to the point about recourse to public funds. I spoke about assistance with benefit claims and things of that nature. Again, we need to identify those individuals, and there is more we can do collectively.
The hon. Lady touched on the current crisis with covid-19 and how we will continue to do these things. That is a fair challenge to us all, because we will not be able to hold events in the way we had planned to. Much more work will now take place through media campaigns and our casework approach, but also through one-on-one communications. I would like the individuals she mentioned in her constituency, and other individuals who are working at the grassroots, to get in touch with me and my office. We will absolutely work with them to create a network locally.
Joy Morrissey (Beaconsfield) (Con)
I was pleased to hear my right hon. Friend announce a fund for organisations to promote the various Windrush schemes. Will she confirm that the money will be directed to grassroots organisations? Will she also share the contact details for the various schemes with MPs so that we can direct our constituents appropriately?
Priti Patel
My hon. Friend is absolutely right. I have announced today that we will open a £500,000 fund for grassroots organisations. All Members’ constituents, and organisations locally, can benefit from that outreach. I will publish details shortly of how we can work together—the House needs to come together—and make sure we can reach out to these individuals and communities. I will make those details available to everyone.
Kate Green (Stretford and Urmston) (Lab)
The Home Secretary is aware of the serious dent in trust in her Department and the Government that these events have created in the community, which explains in part why the take-up of compensation so far is so low. One absolute running sore is deportations, particularly of people who have spent virtually their whole lives in this country—who have been brought up, educated and had their values and ethical views inculcated in them here—and who have served sentences for criminal convictions in this country, but then found that a further penalty is imposed on them, which causes huge resentment. In her review of policies, could the Home Secretary look again at the policy and the practice of deportations? I fear that, until this issues is addressed, the community will continue to feel very deep suspicion of her Department’s motives.
Priti Patel
The hon. Lady touches on a fundamental issue, which is that breach of trust. I know from the time I have spent with individuals from the Windrush generation and with advisory groups, and from speaking to groups and individuals, that it is fundamental, and it is a fact that that breach of trust will take a considerable time to repair. In doing that, there are a number of things that we will have to address. That includes, of course, our engagement and our approach, but also giving an absolute assurance that we are there to serve people and to support them in correcting their status and making their financial compensation claims. That is, effectively, what we are doing.
On top of that, I can give an assurance, as I said, that as part of the review and the recommendations I will be considering, I will review the way in which the Home Office operates—yes, the leadership and culture, but also many of the policies. I have touched on cultural change, but there is also the compliant environment policy.
Paul Holmes (Eastleigh) (Con)
Has the Home Secretary ever experienced institutional racism at the Home Office?
Priti Patel
Racism is not an issue that we should take lightly at all. As I said in my statement—other Members of the House can reflect on this—many people, including people of my own background, leave the house every single morning knowing that they could be treated differently because of who they are or where their parents came from. We have to do much more as a society on how we treat people, but also to understand the causes and deal with issues of racism at every single level.
Matt Rodda (Reading East) (Lab)
I welcome the Home Secretary’s statement and the report. This is quite clearly the most dreadful scandal and, as she rightly said, a breach of trust. Will she now reassure the House that she will do everything in her power to try to mend that breach of trust, and that she will treat the Windrush generation with the respect they deserve?
Priti Patel
I thank the hon. Gentleman for the tone of his question and for the points he makes. I urge all right hon. and hon. colleagues to look at the review. It is deeply moving and powerful. In many ways, it gives a voice to people who felt that their voice was taken away from them. My focus is to do right in terms of the wrongs that were undertaken and, more than just apologising to the individuals and communities affected, to review the recommendations and ensure that my Department puts people before process.
Nickie Aiken (Cities of London and Westminster) (Con)
It is clear that my right hon. Friend is appalled by what she has read in the report. She has spoken with compassion, and I believe fully that she will ensure the Home Office changes. If there is one person who can do it, it is my right hon. Friend. However, can she give me an assurance that there will be no cap on the compensation awarded under the Windrush scheme?
Priti Patel
My hon. Friend is right to point to the scheme itself. I have spoken about the scheme and the way it works. There is no cap at all. I repeat my plea to all colleagues in the House to work with us to bring forward cases of claimants in their constituencies. I thank colleagues who have done that—not just recognising those individuals but working with the Home Office to ensure that those who are eligible receive the full compensation.
Wendy Chamberlain (North East Fife) (LD)
This report and the Windrush scandal itself demonstrate how, under the hostile environment, people who have every right to live in the UK are far too often wrongly denied access to housing and other services, including the NHS. Now more than ever, ensuring access to healthcare for those who need it is crucial. In particular, it is vital that no one who needs to be tested or to seek treatment in relation to covid-19 is put off by uncertainty over their immigration status or fears that they will find themselves detained or reported as a result. Will the Home Secretary therefore guarantee that there will be no sharing of personal information from the NHS to the Home Office for immigration purposes?
Priti Patel
I have already made it clear that the lessons from this review must be learned at every level. The hon. Lady raises a very important point about covid-19, access to public services and public health. As far as I am concerned, that is not an issue we will need to deal with. When it comes to the Windrush generation—the individuals we have been speaking about who were involved in this review—they will be able to access public services and public funds in the way I have spoken about.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
The Windrush generation were British. They should not have been caught up in our immigration system, but they were. The Home Secretary’s apology and use of the past tense remain unconvincing while the hostile environment they experienced is still in place. The all-party parliamentary group for Africa, which I chair, reported on the disgraceful treatment of African visa applicants. As a constituency MP, I see every day, delay, neglect, discrimination and stereotyping in Home Office processes. Will the Secretary of State say today that our immigration system must be not only fair and fast but welcoming, and that that is the standard to which she will hold herself?
Priti Patel
First, Wendy Williams describes in the review a set of measures that evolved under a number of Governments over many decades. Clearly, we all need to move on and look at—[Interruption.] If the hon. Lady had waited patiently for me to finish my sentence, I would have said that we need to look at the review and recommendations. I have been very clear about the work I will undertake in the Home Office in terms of reviewing policies, but also on policies that relate to the compliant environment and cultural change. In my time as Home Secretary, I have been consistent about having a firm, yes, but fair immigration policy to ensure that we are welcoming to people who can come here and contribute to the United Kingdom. That is exactly the signal that our country should be sending to everyone across the world.
Helen Hayes (Dulwich and West Norwood) (Lab)
Is the Home Secretary now beginning to understand how fundamental and profound the breach of trust in the Home Office is that stems from the Windrush scandal? In my constituency, there are Windrush citizens who are fearful of coming forward to claim compensation because of that breach of trust, and many more who live in daily fear of the possibility that their lives might also be ruined by the Home Office. Specifically, they live in fear of ending up on a charter flight. As recently as last month, the Home Office was having to remove passengers from a charter flight because it had not followed due process. Will she commit to pause charter flights and suspend them until the lessons learned review has been implemented in full?
Will the Home Secretary also join me in paying tribute to the Black Cultural Archives on Windrush Square in my constituency? It has played an exceptional role in stepping forward to provide support for Windrush citizens, when grassroots funding was being called for, but was not provided by the Government? Will she confirm that the BCA will now be funded to do its vital work of helping to enable Windrush citizens to come forward to claim the compensation for which they are eligible?
Priti Patel
I have been very clear in my statement today about not just the lessons learned review, but the changes that need to come forward. That is not an overnight revelation. I have been working on this in the Home Office. The hon. Member will have heard in my statement about the work I have undertaken with members of the Windrush generation, the advisory group and the compensation group to understand many of the issues, the challenges and the injustices—I have heard about those experiences at first hand, as no doubt she has—and to understand how we can address them directly.
The hon. Lady has also heard me say today, and I can confirm again, that we are announcing a £500,000 grassroots fund to help support, and to help with the dissemination of information that will support, members of the Windrush generation and others who may have been caught up in this and some of the policies and processes of the past. It is quite clear that there is a great deal more work to do.
The hon. Lady asked about deportations, and in reference to the flight that departed several weeks ago I can give her an assurance that there was no one from the Windrush generation on that flight. Not only that, but that deportation took place under the UK Borders Act 2007, which was introduced by this House of Commons under a previous Labour Government.
Lilian Greenwood (Nottingham South) (Lab)
The Home Secretary has already acknowledged that the Home Office has not investigated the impact on those from Commonwealth countries outside the Caribbean and has excluded from consideration those with a criminal record who were wrongly deported. Can she confirm that the research will now be extended, as Wendy Williams recommends, and will she ensure that sufficient resources are made available so that the work is carried out as soon as possible?
Priti Patel
I will be looking in detail at every recommendation that Wendy Williams has put forward, and I will be working with her on the delivery of many of them.
Stephen Timms (East Ham) (Lab)
Six years ago, over 30,000 overseas students from Commonwealth countries lost their visas when they were accused by the American firm ETS of cheating in its TOEIC—test of English for international communication—English language test. It has since become clear that many of those accusations, in fact almost certainly most of them, were without foundation. In learning the lessons of Windrush, will the Home Secretary ensure that students who are innocent get an affordable route to finally clear their names?
Priti Patel
The right hon. Member has raised this point with me previously, and I thank him for raising it again today. I will look into it. He has asked me to do so, and I will absolutely take that away.
Business of the House
(4 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Leader of the House of Commons (Mr Jacob Rees-Mogg)
The business for the week commencing 23 March will include:
Monday 23 March—Consideration of a business of the House motion, followed by all stages of the Coronavirus Bill.
Tuesday 24 March—Committee and remaining stages of the Windrush Compensation Scheme (Expenditure) Bill, followed by a motion relating to appointments to the Parliamentary Works Sponsor Body, followed by a general debate on the situation in Yemen—the subject for this debate was determined by the Backbench Business Committee—followed by, if necessary, consideration of Lords amendments.
Wednesday 25 March—If necessary, consideration of Lords amendments, followed by Opposition day— 7th allotted day. There will be a debate on a motion in the name of the Leader of the official Opposition, followed by, if necessary, consideration of Lords amendments.
Thursday 26 March—If necessary, consideration of Lords amendments, followed by a debate on a motion on errors in payments made to victims of the Equitable Life scandal, followed by a debate on a motion on human rights in Kashmir—the subjects for these debates were determined by the Backbench Business Committee—followed by, if necessary, consideration of Lords amendments.
Friday 27 March—Private Members’ Bills.
The provisional business for the week commencing 30 March will include:
Monday 30 March—Consideration of Lords amendments, if necessary, followed by Second Reading of the Non-Domestic Rating (Public Lavatories) Bill, followed by, if necessary, consideration of Lords amendments.
Tuesday 31 March—Matters to be raised before the forthcoming Adjournment. The subject for this debate was determined by the Backbench Business Committee.
Valerie Vaz (Walsall South) (Lab)
I thank the Leader of the House for consulting Opposition parties last week on Westminster Hall debates, the result of which he has announced. We are in unprecedented times, and I appreciate that things are moving fast. I hope he will continue to consult.
I thank you, Mr Speaker, for the statement you made yesterday, when the Chancellor gave his statement to the press first rather than to Parliament. Parliament must be told first: we are not irrelevant. I note that the Chancellor apologised and gave you an assurance, but he did not actually say that he would not do it again. I ask the Leader of the House to ensure that, when press conferences are held, all the information is given. What is happening is that journalists are being briefed afterwards and important information is then highlighted under breaking news, rather than at the press conference.
I thank all the staff—we now have a skeleton staff—and those who have made arrangements so that they can service Parliament. Could I ask the Leader of the House if the parliamentary staff are key workers, so they too can be supported with childcare and other benefits? Will he confirm that no one will have to use their holiday entitlement when they are self-isolating or when they are sick? Hopefully they will get sick pay, but there is an issue that they may be using up their holiday entitlement.
We were in a good position to learn from other countries. After all, China built hospitals in two weeks. Vò in Italy has tested a lot—and we know that asymptomatic people, of which there may be many here, can still transmit it—and it is now virus free. I am pleased that the Leader of the House has taken on board the suggestion that I made last week, and that the Government and the BBC have looked to ensure that the over-75s do not have to pay for their television licence fees. I note that that is only until August, but all the other packages that have been mentioned will take place over 12 months.
The Education Secretary yesterday said he wanted to work with the BBC to ensure that our children can learn while they are at home, and also to provide exercise for seniors while we are all self-isolating. It is not right that the BBC should have to foot the bill, and it needs to be compensated for any loss of income. I want to ask the Leader of the House if he can, as much as possible, confirm that we will be back on 21 April. We know the Environment Bill is in Committee: can he make a statement on the timetable for Bills and the Brexit negotiations?
If we have to self-isolate, we will all be indulging in the creative industries— music, television and films. I know that the Leader of the House knows that most of those involved are self-employed now. Many of them have had concerts cancelled, and we need to have a proper package for them so that they do not lose out. There is some confusion, because insurers are cancelling events and citing force majeure. We know that the Department of Health has said that coronavirus is a notifiable disease, so could he please clarify that?
I have a constituent who had a stroke, and she has been asked for a sick note by her human resources department, but the GP is not giving her one. Could the Leader of the House clarify whether sick notes are needed?
I appreciate that the emergency legislation will be published later today—perhaps it has already been published—and it includes a sunset clause of two years. I would urge caution, because this is, after all, the Government that were found to have acted unlawfully over Prorogation. It is important that there is a shorter sunset clause and that the Leader of the House confirms that Parliament will return on 21 April.
May I make a helpful suggestion? There are lots of issues coming out of each Department. Could a statement be made, and published on gov.uk, on each Department and its package, and could there be dedicated helplines, so that we do not have to trouble, say, a Health Minister with questions about employment rights?
I know that the Government do not want to appear on “Today”, but the former Prime Minister Gordon Brown had some very important words to say on it this morning, and they should be heeded. Will the Government ensure that experts from other fields are heard? After all, when Gordon Brown was Prime Minister, he and Alistair Darling went through the economic emergency caused by the banking crisis, and also had to deal with flooding. What Gordon Brown said was very important: we are here to protect not our institutions, but our people. Please could we ensure that that happens?
It is excellent news that Nazanin has been freed. I thank the Leader of the House for all his efforts on that front, and those who made diplomatic efforts. Nazanin is out for two weeks, albeit with a tag that her family has had to pay for. Some 85,000 prisoners have been released in Iran, but neither Anoosheh nor Kylie, both dual nationals, are among them. Could I again ask the Leader of the House to raise their case? They need to be back home, where we can help them if they have coronavirus, which we know is widespread in Iran.
One of the good things to have come out of the current situation is the fabulous community groups that have been set up to help people. Post Office workers and members of the Communication Workers Union are going to every house, helping with deliveries. Firefighters in Manchester are going to ring elderly people often. Let us keep our spirits up. Tomorrow is the first day of spring!
Mr Rees-Mogg
The right hon. Lady is right to keep our spirits up, and to remind us that tomorrow is the first day of spring. I hope that will put a suitable spring in our step. I am very grateful for the support given to the Government in these difficult times by the Opposition; the right hon. Lady; the Leader of the Opposition; the shadow Health Secretary, who has been working very closely with the Government; and of course to the Opposition Chief Whip, who is invariably a means of ensuring that mechanisms in this place work.
I also record my thanks to parliamentary counsel for the phenomenal work that they have done in bringing forward the emergency legislation that will be presented later today. They have been working all weekend and late into the night on drafting the Bill. I note the point made about the sunset clause; it will have been noted. We want to maintain co-operation with all parties across the House, and I am sure that there will be discussions over the weekend on that point, but it is not for me to make commitments. I am genuinely grateful for the support.
On statements to this House, the Chancellor did indeed apologise for not making his statement here first. He was bringing forward financially sensitive information; those kinds of statement can be more difficult than others. I am glad to say that the Education Secretary made his statement here first, before holding a press conference. It is not an easy issue, because we need to inform the country at large, but maintain parliamentary accountability at the same time. Obviously, we will work closely with you, Mr Speaker, to ensure that Parliament is kept properly informed, and that we do not find things out purely from news reports, but it is important to get information out to the country at large as well.
With regard to our return on 21 April, it is very important that Parliament continues to sit. The position of Her Majesty’s Government is that Parliament will continue to sit. It is a point of significance. We need to be held to account, and to legislate. As for Bills in Committee, we will be able to ensure that those Committees continue as long as the House is sitting, but we may need discussions on precisely how the House operates. The shadow Leader of the House asks about voting arrangements. I thank the Opposition for not calling Divisions this week; that has been helpful in the circumstances. We need to work together closely to ensure that the mechanisms that we use are effective, to ensure that we hold the Government to account, and to legislate properly. We will have to look at this matter; I do not think it is right to make an immediate decision from the Dispatch Box. Let us see what the situation is when we come back on 21 April. There will have to be cross-party agreement; that is of fundamental importance to how the House works.
With regard to sick notes—I am grateful to the right hon. Lady for mentioning this to me in advance—as I understand it, they can now be obtained by going online with 111, so people will not need to get them from their doctors, though I reiterate the Government’s encouragement to businesses to be flexible about it. British businesses in many ways are leading the way. One hears all sorts of pieces of good news. For example, BP is offering free fuel to emergency service vehicles and things like that. Business is being community-spirited, and I encourage the business in the specific case she mentions, and in other similar cases, to behave in that way.
The right hon. Lady makes very good points about the centralisation of information. It is important that we have a reasonable balance rather than constantly bombarding Ministers to get information that is straightforwardly available already. The more information is collated, the better that will be. That was an extremely valid point, as was the point about the expertise of others. I also heard the interview with Gordon Brown, who had many interesting things to say, and I can assure the House that the Government are taking suggestions from a wide range of sources. As one can imagine, ideas are pouring in to the Government, and that is welcome.
On the over-75s, Lord Hall was on the radio this morning saying that the issue was under review. It is not therefore an August deadline and that is it—it is a decision that has been made until then. The BBC will consider it further, although I think we are going to have the opportunity of watching lots of repeats if we are staying at home. There are some wonderful programmes that were made not so many years ago, so that will not be too much of a burden, I would have thought.
I share the right hon. Lady’s pleasure about Nazanin Zaghari-Ratcliffe. It is really very good news that she has been released. To update the House, the Foreign Secretary spoke to the Foreign Minister Mr Zarif on 16 March about all the dual national cases, so the Government are continuing to push on that. One piece of good news is welcome; let us hope there is more good news to come.
Sir David Amess (Southend West) (Con)
Will my right hon. Friend find time for a debate on the treatment of UK nationals held in prisons overseas? Last month I went with my constituent Mr Sandhu to see his son held in prison in Prague for alleged offences of fraud. The family very much want the Government to intercede to see if their son can be released on bail.
Mr Rees-Mogg
I welcome my hon Friend back to business questions. We have missed him, and I am glad that he is not forced stay at home and is therefore able to raise that point. Consular staff are providing assistance to Mr Sandhu’s son, and the Foreign and Commonwealth Office has set out how it can help in its publications available on gov.uk, called “Support for British nationals abroad: a guide” and “Arrested abroad”. We can consider intervening with the local authorities if a detainee is not treated in line with internationally accepted standards or with consent, to raise concerns about mistreatment. However, as my hon. Friend will understand, the Foreign and Commonwealth Office cannot interfere in the judicial and legal processes of another country. We can make representations, but we cannot force. My hon. Friend is right to raise the issue.
Tommy Sheppard (Edinburgh East) (SNP)
Last night I was due to speak at an event for which more than 300 people had registered but, because of the crisis, the organisers took the event online and all those people were able to participate from the convenience and safety of their own homes. What surprised me was that the hardware I required to do that was none other than the standard issue iPad I was given five years ago by this Parliament. I say that because it convinces me that the technology is available for us to continue to have informed democratic debate without the necessity of having to meet in this Chamber.
Is the Leader of the House considering such procedures? Alongside things such as changing our Standing Orders to reduce the attendance required to make legislation, there are also mechanisms whereby people can represent their constituents and press the case that they want to on behalf of the people who elected them without the necessity to actually attend the Parliament, and I think we need to do a lot more on that.
With regard to the emergency legislation, which we shall see shortly, I wanted to ask a specific point as to whether that will give the Government the scope to take action against some people who are engaged in quite disreputable behaviour at this point in time. While the public response to this crisis has brought out the best in people, there are some instances where it has brought out the worst as well. Many people will be shocked by the fact that there are private medical companies profiteering by charging exorbitant fees for testing at this point in time. I believe such people should be detained and their assets should be commandeered and put to the public good. I wonder whether the emergency legislation will give the Government the powers to act in that way.
With regard to the debate about a universal basic income or a minimum income guarantee, which many people feel is essential to avoid perhaps millions of people approaching the Department for Work and Pensions for benefit claims, the Prime Minister gave a guarantee yesterday that he would meet with others and bring forward proposals on that. When might we expect a statement to the House from the Prime Minister on that, and when will such a meeting take place?
Finally, it seems rather surreal and fanciful to be planning to meet not just next week in full, but the week after. Should we not now be taking steps to wind down our formal processes and go to the Easter recess at the end of next week? Would that not be the sensible course of action and indicate leadership to everyone else in the country?
Mr Rees-Mogg
I am grateful to the hon. Gentleman for the tone and the interest of his proposals. Everybody is open to ideas as to how things might be done differently and what the needs are on attendance. Mr Speaker received a letter from the Chair of the Procedure Committee, my right hon. Friend the Member for Staffordshire Moorlands (Karen Bradley), that sets out options for how Select Committees may be able to carry on with their important business without meeting in person. Parliament will consider what steps can reasonably be taken to allow things to be done remotely. It may be difficult to recreate the Chamber remotely, but there are certainly options with Select Committees and they are being considered.
The Government share the hon. Gentleman’s concern about people profiteering from the crisis and are aware that some people are behaving extremely well and others are using this as an opportunity. One has heard stories of people charging exorbitant prices for hand sanitiser, loo roll and so on, so the Government are aware of the issue and will act if necessary. As yet, it does not seem to be so widespread a problem as to require Government action, but we are not ignoring the point.
On universal basic income, the Government are willing to consider all ideas. Lots of ideas are coming in. The priority is to proceed with things that can be implemented rapidly and for which systems already exist. It may prove difficult to introduce entirely new systems, but I am sure that the Prime Minister, having said that he is open to meetings on this matter, will prove open to meetings on this matter.
As regards the week after next, the House voted for the recess dates, but it can obviously vote for new recess dates. We want to maintain flexibility, because I cannot make an absolute guarantee that all the emergency legislation that could possibly have been thought of is in the Bill coming before the House today. There may be other things that we need to legislate on, and there is also a demand for scrutiny, so we have to get the balance right. Nothing will be done without consulting the Opposition parties—I emphasise the plural.
Mr David Davis (Haltemprice and Howden) (Con)
The Opposition have a serious point in terms of the duration of the debate on the emergency legislation, given that it appears that we will debate it only for one day. There is a qualitative difference between a single-day debate on major legislation and even a two-day debate. I know that the upper House has different constitutional arrangements, but can the Leader of the House tell us how much time he expects it to spend considering the legislation, before it sends it back to us?
Mr Rees-Mogg
I note my right hon. Friend’s point, of which the Government are aware. The Bill needs to progress with support in this House. Emergency legislation is best done and tends to go through successfully only when there is widespread consensus, so his point is important. Unfortunately, I cannot say what proceedings will be in the other place, and I do not think it would be right for me to try; it would be slightly impertinent of me to say what their lordships will do.
Karl Turner (Kingston upon Hull East) (Lab)
There is a lot of rivalry in the rugby league, especially in Hull, where we are blessed to have two super league teams: Hull FC and Hull Kingston Rovers. It is clear that rugby league clubs need a special scheme of support. I spoke with both clubs’ chairmen yesterday evening, and they are very worried about the survival of their clubs as a result of covid-19. Can we have a statement from a Minister on what plans there are to financially support rugby league clubs at this incredibly worrying time, so that they can survive to not next week, next month or next year, but for the next 125 years?
Mr Rees-Mogg
A lot of businesses and sporting organisations are worried. I reiterate what the Chancellor has said: everything that can be done will be done to ensure the stability of the economy through this period and that businesses that are well founded are able to continue.
Theresa Villiers (Chipping Barnet) (Con)
Tomorrow, thousands of businesses across the country that provide childcare and nursery services have been asked to shut their doors for an indefinite period. Can we have a debate on what we can do to help the childcare sector through this very difficult period, to ensure that we have successful, thriving and high-quality nursery provision for the years ahead?
Mr Rees-Mogg
There are inevitably concerns following the announcement yesterday of the closures that will take place. The Government are working with providers of all levels of education to ensure that they are aware of the situation and are helped to cope through it, and I understand that further announcements will be made today.
Lilian Greenwood (Nottingham South) (Lab)
Will the Leader of the House take this opportunity to thank everyone working on our transport networks—on our buses and trains, driving delivery vehicles and so on? Does he recognise that there are real concerns about the impact of the reduction in passenger flights, not only on travel businesses and aviation workers but on the movement of essential goods which are usually carried in the hold of passenger planes? When can we expect a statement from the Secretary of State for Transport, so that we can raise this and many other concerns?
Mr Rees-Mogg
Of course, I am willing to thank everybody in the transport sector who is working so hard. It is interesting to note, in terms of how society has developed, that delivery drivers for supermarkets are unquestionably key workers. They are playing an incredibly important role, particularly for those who need to stay at home and, from next week, for those with particular medical conditions who will be encouraged to be shielded. The work they are doing is making it possible for people to carry on with their lives as far as possible, so it is very important work. With regard to the flow of trade in the bellies of aeroplanes, that is an important point. I think there is such demand for ministerial statements that many of them will need to be written rather than oral statements.
Sir Bernard Jenkin (Harwich and North Essex) (Con)
I thank my right hon. Friend for his response to the hon. Member for Edinburgh East (Tommy Sheppard) on how this House should operate. I want to connect two issues: the scrutiny of emergency powers and the need for public confidence in their exercise, and the role of Select Committees. When does he think he will be in a position to announce to the House what the arrangements for Select Committees will be? If these emergency powers are to be exercised, Select Committees can sit when the House is not sitting and provide some democratic oversight of how these powers are being exercised.
Mr Rees-Mogg
Perhaps it is helpful to explain how we came to agreement on Westminster Hall being suspended, to give an example of how we are intending to work. There was a letter from the Clerk of the House to Mr Speaker. Mr Speaker consulted me. I consulted the right hon. Member for Walsall South (Valerie Vaz) and representatives of the Scottish National party. We consulted the Chairmen of the most relevant Select Committees, and then we came forward with a motion. It is very important that what we do for Select Committees similarly has cross-party support and consensus across this House. I think that if the Leader of the House, representing the Government, were to come forward with proposals for how Select Committees should operate, people might think that that was designed not to enhance but to reduce scrutiny. It is of the utmost importance that this is done with consensus, and therefore it will take a little time—a few days—to discuss these matters, but proposals will be brought forward.
Carolyn Harris (Swansea East) (Lab)
In the last hour I have received urgent communication from the leading funeral operators in the UK, who tell me that there is a reluctance by the Cabinet Office to include funeral care workers on the list of essential employees. It is inconceivable that this industry will be short-staffed at this time. Will the Leader of the House please urgently communicate with his Cabinet colleagues to ensure that those in the funeral industry are on the list of essential workers?
Mr Rees-Mogg
The hon. Lady always makes the most important points in this House, and I always find myself in agreement with her. It is no different on this occasion; I will take her point up with colleagues immediately after this session.
Mark Pritchard (The Wrekin) (Con)
Many colleagues have constituents abroad, many of whom are desperate to get back home. When can we have a debate on price gouging and bring forward—perhaps in the emergency legislation—price gouging measures? Most airlines are trying to do their bit to help, but there are some examples of egregious price gouging preventing people from coming home. I think that British people might find it very difficult to swallow if the airlines wanted us to bail them out while at the same time they were hiking up prices for people who need to come back home.
Mr Rees-Mogg
My hon. Friend raises a sensible point. The Foreign Office is working closely with the airlines to ensure that people can be brought back home, and the Department for Transport is working closely with them as well. I would make a general point that goes back to what was said by the hon. Member for Edinburgh East (Tommy Sheppard), which is that businesses are, in some cases, behaving very well. Businesses will want to maintain the support of the community in what they do, so, regardless of Government intervention, they would be well advised to maintain the good will of the British people.
Patrick Grady (Glasgow North) (SNP)
I want to follow up on the point about Select Committees. Will the Government please bring forward next week the motions to establish both the Liaison Committee and the Scottish Affairs Committee? I know that we have had our differences about this, but we need the scrutinising mechanisms in place.
Mr Rees-Mogg
I am obviously aware of these points. Both Committees were prevented from being set up by actions within this House, so the Government are inevitably deliberating on the consequences. The priority is ensuring that the Select Committees that are already set up can operate, rather than necessarily the ones that are not yet set up.
Dr Julian Lewis (New Forest East) (Con)
In difficult times we should remember those who sacrifice most, so may we have a statement or debate on the substance of early-day motion 280 about the scandal of war widows who lost their pensions on remarriage?
[That this House honours and recognises the sacrifices that our veterans and their families make; notes the particular sacrifices that the partners of veterans make and the consequences for them of tragically losing a spouse or partner serving in the armed forces; notes the changes announced in 2014 which allowed war widows or widowers that lost their spouse or cohabiting partner in service in the armed forces before 6 April 2005, and had not remarried by 1 April 2015, to retain their war widow pension for life regardless of ongoing relationship status; notes however that this regrettably excluded war widows bereaved before 6 April 2005 that had already had to surrender their war widows pension upon remarrying or cohabiting; believes that this is unacceptable; notes that the only way this group of war widows could regain their pensions is by divorcing their current partners and remarrying them; agrees with the then Defence Secretary who said on 18 February 2019 that this was a burning injustice, Official Report, column 1187; and therefore supports the campaign of the War Widows Association to rectify this anomaly; and urges the Government to correct this injustice by providing equalisation and compensation for the small number of war widows unjustly affected.]
May we also have a debate on early-day motion 307—which, more positively, is about the enhanced co-operation between Blind Veterans UK and the Blinded Veterans Association of America, which are setting up a new combined eye trauma taskforce—and look for the Government’s support in that matter?
Mr Rees-Mogg
The Government recognise the unique commitment that service families make to our country, and remain sympathetic to the circumstances of those widows who remarried or cohabited before 1 April 2015. However, the Government currently have no plans to reinstall state war widows’ pensions for war widows who remarried or cohabited before the 2015 change took effect. The Defence Secretary stated in the House on 3 February 2020 that the Department is
“examining alternative methods to see whether we can mitigate the impact”—[Official Report, 3 February 2020; Vol. 671, c. 3.]
of these changes. There is always a difficulty with cut-off dates.
As regards the co-operation between the US and the UK in relation to blindness and eye problems, what my right hon. Friend suggests sounds extremely worth looking into, and I will ensure that it is taken up with the Ministry of Defence.
Christian Matheson (City of Chester) (Lab)
Further to the question from the hon. Member for The Wrekin (Mark Pritchard), I have constituents who are as far away as the Philippines and Peru at the moment. They have been told to contact the embassies, but the embassy staff have rightly been sent home and contact with the embassies is nigh on impossible. There is spare capacity on the airlines at the moment, so can we have a statement from the Department for Transport or the Foreign Office—or, better still, both—about how we are going to bring our stranded people back home?
Mr Rees-Mogg
I can assure the hon. Gentleman that this is at the forefront of what the Foreign Secretary is doing; I heard him say that only this morning. He is ensuring that people who are in difficulties in remote areas receive as much support as the Foreign Office can possibly give.
Adam Afriyie (Windsor) (Con)
Through you, Mr Deputy Speaker, may I thank Mr Speaker for the pace at which he brought through the changes to the way we operate here in respect of social distancing and our practices? That was the right thing to do. It seems to me that, given the scale and pace of the coronavirus spread and the threat to life, health, incomes and jobs throughout the country, it is quite right that the Government bring forward emergency legislation briskly and want to see it go through the House briskly, but it is equally right that Parliament has the opportunity to scrutinise the legislation. I have a couple of questions along those lines. First, is there a particular reason why the Civil Contingencies Act 2004 was not used? It already contains many of the safeguards that I suspect the House will wish to see.
Secondly, if the emergency legislation is passed—I hope it is, given the circumstances, albeit possibly with a few modifications—what other opportunities will there be for the House to question particular measures? This is a dynamic and fast-moving situation, and it may well be that within literally 48 or 72 hours one of the measures adopted results in perhaps 1 million or 2 million unemployed people with nowhere to go. What other opportunities will there be for the House to hold the Government to account quickly, should it prove necessary
Mr Rees-Mogg
Unfortunately, the Civil Contingencies Act would not have worked in these circumstances, because the problem was known about early enough for it not to qualify as an emergency under the terms of that Act. The legal experts say that if we can introduce emergency legislation, we should do so rather than using the Civil Contingencies Act, because if we have time to introduce emergency legislation, we obviously knew about it long enough in advance for the Act not to apply. That is why that Act could not be used.
On future scrutiny, one reason why it is so important that we keep the operation of this House going—to which, as I have said before, the Government are committed—is to ensure that scrutiny takes place. The Government of this country are the Executive and the legislature; they are not purely the Executive. We need to ensure that the legislature is operating efficiently, even if it has to operate differently, to ensure that we carry out our proper role.
Helen Hayes (Dulwich and West Norwood) (Lab)
My constituent, who is trapped in Peru, is being advised by the British consulate to apply for a place on a private flight, at a minimum cost of $3,000. When a member of my casework team challenged that advice and suggested that my constituent may not be able to access $3,000 easily, she was told by the representative at the British consulate, “Do they want it to be free, then?” That is not consistent with the sentiment that the Leader of the House recently expressed when he said that the Foreign Secretary is doing everything within his power to bring our citizens home. Will he ask the Foreign Secretary to come to the House to explain the lack of capacity in British consulates overseas, the appalling attitude that is being taken by some of his staff, and how he is going to ensure that our vulnerable citizens stranded overseas can come home during this pandemic?
Mr Rees-Mogg
I reassure the hon. Lady that the Foreign Secretary is, as I said earlier, taking this issue with the greatest seriousness. It is a little unfair to pick on one example of an offhand comment and assume that that is the general way consulates behave. Consulates are deeply stretched because of the numbers involved and the nature and unexpectedness of this crisis. Dare I say it that all of us have come to realise the seriousness of this crisis over time, so some replies are getting better as time goes on and the necessity becomes clearer. The Foreign Secretary is certainly working very hard on this issue.
Mr Tobias Ellwood (Bournemouth East) (Con)
The Select Committee on Defence wants to meet on Tuesday, but it will not be doing so. We have the witnesses in place, but they cannot beam themselves in virtually. I hope that can be corrected so we can go to a digital environment.
May I invite Ministers to give us a statement on military assistance to civil authorities through the covid-19 support force? We have 20,000 armed forces personnel on standby for mobilisation to assist during this coronavirus outbreak. They will do a terrific job, but what will that job be? There is speculation that they might be involved in the shutdown of London, but we know that is incorrect. On top of that, they have a day job to do of watching our backs to keep our nation safe. With that in mind, and with the ever-increasing pressures that will be placed on those personnel as the coronavirus outbreak continues, will Ministers consider delaying the defence, foreign policy and security review until the new year?
Mr Rees-Mogg
Select Committees need to think carefully about how they approach their business before any specific arrangements are made. Public evidence sessions are the greatest strain on House resources because of the requirement for Hansard reporters, for broadcasting and so on. I ask the Chairmen of Select Committees to be considerate in their planning for public sessions. Private sessions require much less in terms of House resources.
On assistance from the military, I understand a written ministerial statement will be tabled today by the Ministry of Defence. I agree with my right hon. Friend that the service provided to us by our armed forces, in all circumstances, is truly remarkable and inspirational.
I am glad my right hon. Friend has raised some of the wilder stories that were circulating yesterday, and I encourage all hon. and right hon. Members to listen to official sources of information. Some of the things going around yesterday seem to have been said merely to make the flesh crawl. It is much better to listen to the press conferences of the chief medical officer and the chief scientific adviser for their calm responses to what is actually happening.
Ruth Jones (Newport West) (Lab)
I am worried for the many vibrant and unique pubs, clubs and music venues in Newport West. Their insurance policies cover a long list of notifiable diseases, but covid-19 is not one of them. Sam Dabb, the owner of Le Pub, a co-operative pub and music venue in Newport city centre, told me: “Without Government intervention, my business will not survive. Most people in the hospitality industry are in the same boat.” When does the Leader of the House expect the Government to announce what support will be provided to businesses whose insurance policies do not cover covid-19 as a notifiable disease?
Mr Rees-Mogg
The hon. Lady is right to raise this point. The Chancellor has said he will do whatever it takes, which is an important commitment. The scale of the problem is one that, if just moved to the insurance companies, it would have an effect on the insurance companies. We therefore need to look at what the Government are doing and at their overall approach, and we need to take to heart the Chancellor’s word that he will do whatever it takes.
Bob Blackman (Harrow East) (Con)
The Chairman of the Backbench Business Committee, the hon. Member for Gateshead (Ian Mearns), is away on constituency business so, on behalf of the Committee, can I ask my right hon. Friend what provisions will be made for restarting Westminster Hall debates, which are a major part of the Committee’s allocation? Alternatively, will there be further time for debates in this Chamber?
Most of us did not use hand sanitisers until a few weeks ago. I have seen evidence of wholesalers trebling prices to retailers, but it is not clear that those increases have been passed on by manufacturers. Wholesalers are clearly profiteering from these hand sanitisers, and retailers are left with the unenviable choice of passing on the increases or having a small margin. Can we have a Government statement on what will be done to prevent such unfair profiteering at a time of national emergency?
Mr Rees-Mogg
I will answer both questions. We will have discussions about reopening Westminster Hall as soon as that is practicable. There is a commitment to reopen it, and the discussions about reopening Westminster Hall will be similar to the ones about closing it. Particularly at this time, with not all Ministers being available, the pressure has been greater than normal, but that will abate in due course.
My hon. Friend is right to raise the immoral practice of profiteering and racketeering, and I call on wholesalers to exercise better judgment. The Government are keeping a close eye on such activity, as I said earlier, and will act if necessary. Some people always feel the right thing to do in difficult times is to get involved in profiteering. They should think twice about that and not do it.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
I do not know whether the Leader of the House heard his colleague from the Treasury answering an urgent question this morning, but it was quite clear that the Government are struggling, in these exceptional circumstances, to come up with policies and guidance and to get information out to the public on support for workers and families. On that basis, may I suggest gently to the Leader of the House that putting on the Order Paper for the coming days things like Second Reading of the Non-Domestic Rating (Public Lavatories) Bill is not what this Parliament should be focusing on at the moment? We should be having statements from Ministers so that Members of Parliament can raise the issues that their constituents are bringing to them daily rather than starting legislation that is not vital in these exceptional times.
Mr Rees-Mogg
We have had statements from the Chancellor and the Education Secretary, and regular updates from the Health Secretary to keep the House up to date. I would emphasise the word “provisional”. The business for the week after next is, as always, the provisional business and that which is provisional is not set in stone.
Lee Anderson (Ashfield) (Con)
During times of national emergency, the media play a vital role in delivering information to concerned viewers, listeners and readers. Scrutiny is good, but undermining the national effort by spreading misinformation helps nobody and creates panic among some of the most vulnerable members of our society. Will my right hon. Friend raise this issue with broadcasters such as ITV, where Piers Morgan, who has no scientific or medical qualifications, seems to want to make irresponsible comments on a daily basis?
Mr Rees-Mogg
I am grateful to my hon. Friend for his question and he is right to point out the role that the media plays in informing the public and holding the Government to account—[Interruption.] I hear a chunter from the Opposition Benches. Michael Crick is indeed brilliant; he is somebody I particularly admire and one of the best journalists at holding people to account. One does not need to take every utterance from controversialists as holy writ. Piers Morgan enjoys causing a row and, frankly, it would be better to pay less attention to him rather than more and to listen to the Government advisers. Free speech is very precious. If people want to say silly things and look foolish, that is a matter for them.
Charlotte Nichols (Warrington North) (Lab)
I am sure that all colleagues across the House find that the bulk of questions from constituents come in after statements when we have had an opportunity to raise matters, once the details, or lack thereof, of what has been proposed and how it will impact on them have percolated—from breweries to nurseries, to self-employed creatives and everything in between. Will the Leader of the House arrange a general debate to allow us to raise supplementary questions and to give our constituents the assurances that they so desperately need in this very fast-moving situation?
Mr Rees-Mogg
The hon. Lady points out a perpetual dilemma in the practise of holding to account. There is always pressure to come to the House in as timely a manner as possible to ensure that the House is informed immediately; on the other hand, there is better information available 24 hours or 48 hours later which raises more questions. That is why one should view the process of holding to account as a continuum rather than as a one-off occasion, and why it is important to keep this House open, so that Ministers can be held to account. I am not sure that general debates tends to offer that level of focus, but Question Times and continual statements do, and that depends on the House sitting.
Tom Hunt (Ipswich) (Con)
I welcome the unprecedented level of support provided to our businesses by the Chancellor earlier this week, but is it not also important to consider our charitable sector during this critical time? Earlier this week, I spoke to the chief executive of Suffolk Age UK to ask him how my office could support elderly people in my constituency as much as possible. He said to me that, in the short term, there are lots of volunteers—more volunteers than he has ever had before—but his major concern is about the financial future of the charity. In many senses, charities operate in the same way as businesses, and many of their fundraising activities—charity shops, fundraising events—have had to be cancelled because of the crisis that we are going through at the moment. Is it not appropriate for the House to set aside time to debate how we can support vital charities such as Age UK, which, through their volunteers, are supporting some of the most vulnerable people in our constituencies at the moment?
Mr Rees-Mogg
I thank my hon. Friend for raising that and for the work he does to support charities in his constituency. I think all of us as constituency MPs have a role in our communities to do what we can to help. I would go back to what the Chancellor has said. He is aware that these difficulties are affecting a range of sectors and he will do whatever it takes to provide the necessary support. My right hon. Friend the Secretary of State for Digital, Culture, Media and Sport will be co-ordinating the volunteering effort, to ensure that it is as beneficial as possible.
Deidre Brock (Edinburgh North and Leith) (SNP)
I listened carefully to the Leader of the House’s responses to hon. Members’ points about the many UK citizens stranded abroad—our constituents—and I am afraid it will not do. Will the Government make a statement, written or otherwise, on their plans for repatriating UK citizens? Or are they just supposed to continue largely to fend for themselves?
Mr Rees-Mogg
One cannot always provide satisfaction, much though I have tried hard to do so, but Her Majesty’s Government are doing whatever they can to help constituents in these difficult times. The Foreign Secretary is working very hard on this and is working with the airlines on it. This is a process, and I am afraid that not everybody is going to be repatriated overnight, because it is not simply a question of doing that; rather, it is a question of getting in touch with people, ensuring that the facilities are available and then getting them home. However, the Government are working hard to try to help constituents.
Chris Bryant (Rhondda) (Lab)
The Government undoubtedly need emergency legislation, but as I understand it the Bill is some 350 pages long, includes measures that, uniquely, would allow Ministers to switch on and off their powers without any reference to Parliament whatsoever, and is intended to last for two years. Some of these will be draconian measures restricting the liberty of the individual in this country. They may be completely necessary, but can I urge the Government to think about, first, making it possible for us to table amendments on Monday, before Second Reading, which is not the normal way, and, secondly, allowing these measures to last for 90 days before approval by Parliament and then to be renewed every 30 days thereafter?
Mr Rees-Mogg
I would look more favourably on the switching on and off mechanism, which, although not previously used, is a means of limiting these powers rather than extending them. I do not think it has been done before, but it ensures that the powers will be activated only when necessary and, when unneeded, will be removed. I think that is a step in favour of maintaining as much liberty as possible. I recognise that it is a long Bill, and I pay tribute to a parliamentary counsel for their work, which has been really remarkable in the short space of time available. It is important that these measures are passed with consensus. The hon. Gentleman has made his point; I am sure it will be—
Mr Rees-Mogg
I had not forgotten amendments. I believe there is a motion in my name to allow amendments to be tabled before Second Reading, but I cannot give the hon. Gentleman all the comfort he wants on the change of time limit.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The Leader of the House and others have rightly talked about proper scrutiny of what the Government are doing, as rather highlighted by my hon. Friend the Member for Rhondda (Chris Bryant). The Leader of the House was slightly disingenuous, if I may say so, when he talked about the Liaison Committee being delayed by this House. It was actually a power grab by the Government to impose a Chair from outside its membership that has caused the delay. Nevertheless, it is vital that that Committee is up and running, and it could be a hugely useful place for this House, if it had to shrink down its activities, to question Ministers directly and the Prime Minister about actions, especially if we are living under draconian legislation, which is likely to be passed next week. Will the Leader of the House give us some comfort on that issue?
On the point about the motion on Tuesday relating to appointments to the Parliamentary Works Sponsor Body, will we now finally see a group of professionals dealing with the northern estate and making sure that in the midst of this crisis, having had flood and pestilence, we do not see this place burned by fire as well?
Mr Rees-Mogg
A great deal of work has been done on fire safety in this building, with measures implemented that will ensure that we are much better protected than we were. That is very important. People will notice that the state rooms in Speaker’s House are currently not usable because fire safety measures are being implemented, so that is taking place.
As regards the Liaison Committee, I think it would be a very novel constitutional development to think that it could replace the whole House, and I am not sure that that would be something that I would welcome.
Jim Shannon (Strangford) (DUP)
Before anyone was quarantined for coronavirus, 1 million Uighur Muslims were in isolated camps run by Chinese Government authorities. The combination of limited access to medical resources and high populations of elderly detainees could lead to a humanitarian disaster if the virus reaches the camps. Indeed, it may already be there. Will the Leader of the House arrange for a statement on this important issue?
Mr Rees-Mogg
I am always grateful to the hon. Gentleman for his campaigning for religious freedom, irrespective of the religion for which he believes there should be freedom, which is wholly admirable. We have consistently expressed our serious concerns both to China and at the UN about the human rights situation in Xinjiang, including extrajudicial detention of over 1 million Uighurs and other minorities in “political re-education” camps. The Foreign Secretary raised the issue with his Chinese counterpart, State Councillor and Foreign Minister Wang Yi, on 9 March, and we expressed our concerns in the UK in a national statement at the UN Human Rights Council earlier this month. I can assure the hon. Gentleman that this is being taken very seriously by the Government.
Clive Efford (Eltham) (Lab)
The Leader of the House is responsible for protecting the rights of Members of Parliament as well as being part of the Government. Earlier, he mentioned the need to have regular statements here in the House, but I remind him that the Health Secretary came to the House under an urgent question on Monday, the Chancellor came here only after he had made exactly the same statement to the press, and the Education Secretary came with no plan on closing schools six weeks into the crisis. Scrutiny by this House is absolutely crucial. Today, the Cabinet Office is to publish a list of essential workers who will be able to send their children to school. That should be scrutinised by this House. A statement should be made in this House so that we can scrutinise the list. We need more statements from more Departments, not fewer. The Government need to up their act, because it is clear that we have exposed a number of failings in the Government through our scrutiny. It is important that that list is published here, so that we can scrutinise it.
Mr Rees-Mogg
I think the scrutiny has been carried out well by this House. Both the Chancellor and the Secretary of State for Education were questioned for the best part of two hours, which is pretty comprehensive scrutiny, with Members having the opportunity to raise constituents’ concerns and to make points that are valuable to the Government to take on board as they consider their policy developments. I am a great believer in parliamentary scrutiny. I believe our adversarial system is a very good way of improving decision making, so I am personally committed to it, as are Her Majesty’s Government.
David Linden (Glasgow East) (SNP)
Whether it is producing ventilators or acquiring hotels, there is clearly a role for the private sector to contribute towards this national crisis. I have a major soap manufacturer in my constituency, Queenslie’s Soapworks, which is happy to pitch in, but the company needs to know if it is to up production, which it can do within 24 hours. Can we have a statement from the Government on what is expected from the private sector, particularly in the production of things like hand sanitisers and soap?
Mr Rees-Mogg
That is an extremely helpful question. I will ensure that the hon. Gentleman’s constituency company is brought to the attention of the relevant Ministry to ensure that, if more quantities of soap are needed, the company can be involved. The private sector will be crucial in this effort in co-operating with what the Government are doing and changing production to produce ventilators, and I am sure there is a need to produce other things for which there is now greater demand. I am grateful to him for his helpful suggestion.
Kevin Brennan (Cardiff West) (Lab)
Like other hon. Members, I have constituents stranded overseas. David and Anne Clements, who run a small business in my constituency, are stranded in Quito in Ecuador. They were due to fly home tomorrow, but there are no flights and no prospect of any in the immediate future. Could the Leader of the House arrange for the Foreign Secretary to make a further statement—he seemed to rule out repatriation in previous statements—and perhaps persuade him to attempt more co-operation with other Governments, so that, if necessary, flights could be arranged for people of different nationalities to bring them safely home?
Mr Rees-Mogg
The hon. Gentleman makes a helpful point, and the Government have previously co-operated with other nations on repatriation flights. The situation is developing and evolving and the ability to bring people home has become harder in recent days, but as I said earlier, the Foreign Secretary is working very hard on this and is in discussion with the airlines.
Daisy Cooper (St Albans) (LD)
I add my voice to the voices of all those MPs who have called for an urgent statement on what the Government are doing to repatriate UK nationals. I have one constituent who is in a party of five in a military hospital in Hanoi in Vietnam. They are staying in filthy conditions, surrounded by cockroaches and dead rats, and despite writing to the Secretary of State for Foreign and Commonwealth Affairs on Tuesday, I have had no reply. I have three constituents who are stuck in Peru. They have been told not to buy a private ticket, but to stay where they are and not even to attempt to get to an airport. We need to know from the Minister, in this House, when and how our constituents can get home.
Mr Rees-Mogg
It is not is easy as that because there are different problems in different countries, and therefore, simply to say when people can get home is not within the gift of the Government; different practices are being followed in different countries. However, I note that the hon. Lady has not received a reply to a particular inquiry and I will ensure that that is taken up so that a reply is brought to her in a reasonable amount of time.
Matt Western (Warwick and Leamington) (Lab)
I thank the Leader of the House for stressing how important it is that Members here are well informed, but to the outside world, it seems like the business of the House is business as usual. To echo the points made by my hon. Friend the Member for Eltham (Clive Efford), I suggest that we need more frequent updates or statements by the many different Departments that are being impacted on by this crisis, and not only that, but we need daily reporting from the Health Secretary to explain the number of cases, tests, and deaths and the amount of equipment that we are getting out to our much needed hospitals. Only then can we inform our constituents of how this crisis is impacting on our communities.
Mr Rees-Mogg
The House has adjusted its programme to allow Members to be updated at unusual times. Thanks to Mr Speaker’s flexibility, statements have been coming on at times when other business was taking place, and the Opposition graciously allowed their Opposition day to be interrupted yesterday at an early time for a statement to be made, so I think our procedures are being adapted. As I look around the Chamber, I notice that social distancing is being pretty well practised, with broadly the only exception being my opposite number, the right hon. Member for Walsall South (Valerie Vaz)—[Interruption.] And a couple of Government Ministers, too.
We are trying to get the balance right and understand the Government’s message. What is the Government’s message? It is that social distancing is advised for all of us and strongly advised for those over 70 or with certain serious medical conditions, but the Government have not said that businesses should not carry on, and our business carries on in this Chamber. That is in line with Government advice—there is no contradiction between social distancing and continuing with business, as the other half of the hon. Gentleman’s question points towards.
Right hon. and hon. Members want to hold the Government to account, and that means we need to be here to do that, but there again, a balance needs to be struck. My right hon. Friend the Health Secretary has come to update the House often, but he also has considerable ministerial responsibilities—particularly heavy ones at the moment—and I think the House ought to be reasonable in what it asks of him. If he were to be here every day for two or three hours, that would be two or three hours when he was not able to attend to his ministerial business. Getting that balance right is important. In terms of my role, I recognise that I must look at it from both directions—from the point of view not only of the House, with the House being informed so that it can hold to account, but of what it is reasonable to ask of Ministers.
Dave Doogan (Angus) (SNP)
May I give the Leader of the House an opportunity to clarify his answer to my hon. Friend the Member for Edinburgh North and Leith (Deidre Brock), when we talked about repatriating citizens to the UK? The Leader of the House said that the Government would do whatever they can, and I am slightly concerned that that contrasts with the Prime Minister’s rhetoric, which is that we will do “Whatever it takes.” I think we should be looking to do whatever it takes to get our people back home to this country.
In addition to that, we heard a litany of challenges facing small and large businesses in our constituencies this morning during the urgent question. Businesses in in Angus and Arbroath in my constituency are facing challenging situations in getting their brokers, their insurers and, crucially, their reinsurers to face up straightforwardly to what the obligations are under business continuity claims. May we have a statement setting out what the Government’s expectations of the insurance industry are? Is this being done in tandem with the Association of British Insurers?
Mr Rees-Mogg
I reiterate that the Government and, in particular, the Foreign Secretary are working hard on the repatriation issue, but may I add that I will report to him after this session the widespread concern of so many Members? This is not just one of those things that has come up from one Member with a particular case; it seems to be a concern across the House—I see nodding and even hands going up—so I will pass that on in an underlined fashion.
There are indeed a litany of challenges faced by businesses, which is why the Economic Secretary to the Treasury was here for an urgent question earlier, and I understand the point that is being made about insurers. It is difficult for the Government to make a single statement on what will be a variety of contractual obligations, but insurers, thanks to the intervention of the Economic Secretary, have already behaved well in relation to businesses that have not been formally told to close but have de facto had to close, and there was a helpful announcement made by the Chancellor a couple of days ago. The insurance industry, very much criticised, is in some cases already behaving well.
Points of Order
Mr David Davis (Haltemprice and Howden) (Con)
On a point of order, Mr Deputy Speaker. In his response to my hon. Friend the Member for Windsor (Adam Afriyie), the Leader of the House answered, in effect, that the Civil Contingencies Act 2004 was not available for this particular emergency. Knowing my right hon. Friend, I am sure that he was repeating, in absolute good faith, the briefing he had been given, but I was here and lived through the passage of that Act, and that is not my understanding of it. More importantly, it is not how a number of public lawyers understand the Act. So could you, Mr Deputy Speaker, undertake to get the Speaker’s Counsel to give this House an opinion as to whether that Act is applicable before we move the emergency legislation next week?
Chris Bryant (Rhondda) (Lab)
Further to that point of order, Mr Deputy Speaker. One key aspect of the 2004 Act is that the use of powers has to be approved by Parliament within seven days and the powers can last for only 30 days before they have to be renewed by Parliament. Indeed, the Act contains specific measures to ensure that the House sits if we are in recess or even if we are prorogued. So could you feed that into the process of answering the right hon. Gentleman?
Mr Deputy Speaker (Mr Nigel Evans)
It seems to me that both points of order are supplementary business questions, but the Leader of the House is still in his place and will have heard both points of order, and I am sure that those on the Treasury Bench will reflect on what both Members have said today.
Mark Pritchard (The Wrekin) (Con)
On a point of order, Mr Deputy Speaker. You will know that Mr Speaker prides himself on standing up for the rights of Back Benchers, who, perhaps more than ever, need to stand up for the rights of their constituents. The House is due to rise on 31 March. The Leader of the House spoke about potential flexibility on that, and I understand why he did so. Can you give an assurance to my constituents, especially as the Government are seeking unprecedented powers, possibly without review or with review months in the future, that this House will sit for as long as it can, in order that the Government are held to account?
Mr Deputy Speaker
I listened carefully to what the Leader of the House had to say during responses to questions. It seems to me that the commitment from the Government was exactly what the hon. Gentleman is seeking.
Kevin Brennan (Cardiff West) (Lab)
On a point of order, Mr Deputy Speaker. In business questions, the Chair of the Public Accounts Committee mentioned a motion that the Leader brought forward this week in relation to Select Committees, which created a new post outside normal Standing Orders of Chair of the Liaison Committee and put a named individual in the motion to take the post. That flies in the face of the normal practice adopted by the House for many years. The Chairs of Select Committees should be elected from among the whole House, with all Members having an opportunity to put their name forward, albeit on a party-balanced basis, for those particular positions. Could you determine, Mr Deputy Speaker, whether it would be possible for the Leader of the House to table an amended motion, leaving that part of the motion out and allowing the Liaison Committee and all Select Committees to be set up forthwith?
Mr Deputy Speaker
I should make the observation that Mr Speaker is very keen to ensure that the rights of Back Benchers are properly respected. Therefore, I will make absolutely certain the hon. Gentleman’s comments are passed on to Mr Speaker when I vacate the Chair.
bills presented
Trade Bill
Presentation and First Reading (Standing Order No. 57)
Secretary Elizabeth Truss, supported by The Prime Minister, Secretary Dominic Raab, Secretary George Eustice, Secretary Alister Jack, Secretary Simon Hart and Secretary Brandon Lewis presented a Bill to make provision about the implementation of international trade agreements; to make provision establishing the Trade Remedies Authority and conferring functions on it; and to make provision about the collection and disclosure of information relating to trade.
Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 120) with explanatory notes (Bill 120-EN)
Fire Safety bill
Presentation and First Reading (Standing Order No. 57)
Secretary Priti Patel, supported by The Prime Minister, Secretary Matt Hancock, Secretary Robert Jenrick, Secretary Simon Hart and James Brokenshire presented a Bill to make provision about the application of the Regulatory Reform (Fire Safety) Order 2005 where a building contains two or more sets of domestic premises; and to confer power to amend that order in future for the purposes of changing the premises to which it applies.
Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 121) with explanatory notes (Bill 121-EN)
Coronavirus Bill
Presentation and First Reading (Standing Order No. 57)
Secretary Matt Hancock, supported by The Prime Minister, Secretary Priti Patel, Michael Gove, Secretary Robert Jenrick, Secretary Gavin Williamson, Secretary Thérèse Coffey, Secretary Robert Buckland, Penny Mordaunt and Jo Churchill presented a Bill to make provision in connection with coronavirus; and for connected purposes.
Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 122) with explanatory notes (Bill 122-EN)
Mr Deputy Speaker
I remind the House that Members may now table amendments to the Coronavirus Bill. I encourage hon. Members—Chris Bryant is already going—who want to table amendments to do so by sending them to the Public Bill Office by email from their parliamentary network account. If Members would like advice on amendments, I encourage them to phone the Public Bill Office rather than visit in person.
Backbench Business
Loan Charge 2019: Sir Amyas Morse Review
(4 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Sir Desmond Swayne (New Forest West) (Con)
On a point of order, Mr Deputy Speaker. I am sorry to have delayed my point of order, but it is pertinent particularly to this business. May I ask why the Financial Secretary’s excellent biography of Adam Smith has not been laid on the Table as one of the papers pertinent to this debate?
You will appreciate that Adam Smith was absolutely categoric in his view of taxation—that it should be fair, proportionate, not retrospective and not arbitrary, which is clearly the subject matter of this afternoon’s debate.
Mr Deputy Speaker
It is as if the right hon. Gentleman read my mind. I am sure that those on the Treasury Bench will have heard his comments.
Mr David Davis (Haltemprice and Howden) (Con)
I beg to move,
That this House believes that the Loan Charge is an unjust and retrospective tax; notes that the law on the Loan Charge was not settled until 2017; and calls on HMRC to cease action on loans paid before 2017.
The motion is in my name and those of the hon. Member for Brentford and Isleworth (Ruth Cadbury) and my right hon. Friend the Member for New Forest East (Dr Lewis), and is supported by some 40 other Members of the House.
I start by commending my right hon. Friend the Member for New Forest West (Sir Desmond Swayne) for having the courage to beat me to the punch in this particular debate. It may seem strange to outside observers that in the midst of a global pandemic and a huge national crisis that we are talking about a tax technicality—at least, that is how it might appear. But actually it is one of the great virtues of our country that no matter what the crisis, whether it is a pandemic or warfare, the House always pays attention to issues of natural justice. We never ignore issues of natural justice, even in times of crisis. As a matter of justice, which this is, it is not a party political issue. In politics and our business, justice is a matter of honour that we deliver to the British people, and that is what we intend to do today.
The loan charge is an injustice with very large consequences. We have all met and listened to constituents who are facing utter financial ruin as a result of this policy. It is ruining people’s lives. There have been at least seven suicides caused by the stress, anxiety and financial hardship of this policy. To give the House a flavour of that—because it does not apply just to those who have committed suicide but to those who are under stress—here is what the family of one loan charge victim told the all-party group about his suicide note:
“He wrote about being at the end of his tether with the Loan Charge matter. He wrote such awful things about himself things that just weren’t true, that he clearly thought about himself at the time. He wrote that he did not set out to do such wrongdoings; he wrote about being unable to speak to his GP about his anxiety as he was ashamed, his fear of going to prison, his disgust in himself for getting mixed up in the Loan Charge and his belief that he would now go to hell.”
In the case of this individual, the loan charge policy took not just his money, but his self-respect and eventually his life. And there could be more. According to the loan charge all-party group, 39% of those affected have had suicidal thoughts. I think the Minister will be hard pushed to think of another Government policy that has caused more than a third of those affected to consider suicide. It is no surprise that it is having that effect on people. Some 68% have suffered depression, 71% face bankruptcy, and 49% could lose their homes. I said in the previous debate on this issue that the power to tax has the power to destroy, and that has never been more clearly demonstrated than here.
Sir Edward Davey (Kingston and Surbiton) (LD)
I congratulate the right hon. Gentleman on bringing this debate to the House. In the all-party loan charge group, we took evidence from a number of family members of people who had committed suicide as a result of the loan charge, and I can underline the point that he is making. The impact on people who had been law-abiding and hard-working throughout their lives has been quite traumatic. In a particular case that I remember—I am sure that the hon. Member for Brentford and Isleworth (Ruth Cadbury) will remember this—the person who took his own life did not owe a huge amount of money. It was the fact that he had been made to feel like a criminal when he was anything but a criminal.
Mr Davis
The right hon. Gentleman makes an extraordinarily powerful point in his own skilful way. I say this back to him: his group took that evidence before the added economic stress of the coronavirus. Many of the individuals affected will be contractors. They will be people who perhaps have no rights at the moment and certainly no way of finding the money to meet the demands on them. Even small sums of money will bring enormous pressure to bear on the individual. So he is right: this is not some vague and abstract tax issue. This is about people’s lives. That is why I was pleased when the Government launched the Amyas Morse review into the policy, and in December, he published a detailed report. I commend him for his heroic attempt to find a compromise, because that is really what he did. The facts and the conclusions are a little different, and that is because he was trying to find a compromise. However, when it comes to matters of natural justice, I am afraid that a compromise is nowhere near enough. Such a detailed review deserves detailed scrutiny, and I am going to spend a small amount of time looking at his central findings.
Sir Amyas recommended a December 2010 cut-off date for the loan charge. All loans before that date will be out of the loan charge scope. In a piece for The House magazine some time ago I referred to that as arbitrary, and Sir Amyas responded. He said:
“It is not an ‘arbitrary’ date. It is the date from which the Finance Act 2011 ensured that tax was charged on income paid through loan schemes.”
But that simply did not make sense, even in its own terms. The Finance Act was not law in December 2010; it was simply draft legislation. It was not passed for another eight months—until July 2011. HMRC does not, or certainly should not, take its instruction from draft legislation. It certainly should not take it from press releases, which was what actually went out on that day. It takes its instruction from settled law—and the words “settled law” matter.
Sir Amyas went on to argue in his piece that, once the 2011 Act was passed,
“tax should have been understood as being due from that point.”
But even in 2011 the law was far from clear after the Government suffered a series of defeats in the courts.
Bob Stewart (Beckenham) (Con)
My constituents just do not have any extra money—they have used it all up each year. After 2010, they were continually told by financial experts and the companies they were contracted to, “All is well—carry on.” Suddenly in 2017, they faced a massive bill, and they just cannot cope.
Mr Davis
I am talking about how we got to that position. I will come on to talk about the financial status of these people, but my hon. Friend is right: these are not rich people.
HMRC, which has claimed that this is clear law, lost the Dextra Accessories Ltd and Sempra Metals Ltd cases in 2002 and 2008 respectively, when the courts specifically rejected the idea that the loans could be subject to income tax. HMRC then lost a case in 2012 and again in 2014, demonstrating that the 2011 legislation had not clarified the law to the satisfaction of the courts. That is a key point—it was not a question of it not being to our satisfaction or our constituents’ satisfaction, but it was not to the satisfaction of the courts. The fact that HMRC lost twice and then won twice tells us that even experienced, highly informed judges spending a great deal of time studying these cases found it a difficult issue to resolve.
Sir Desmond Swayne
Is not the proof of the pudding in the fact that the 2017 legislation was introduced? The loan charge itself is standing proof that previous legislation was not sufficient to tax the people involved, otherwise that would have been done.
Mr Davis
As usual, my right hon. Friend trumps my argument in advance, but I will come back to that in a second.
What that demonstrates—and what my right hon. Friend’s point demonstrates—is a failure of the Treasury and HMRC to write clear and comprehensible legislation. If the judges cannot understand it, what chance is there for ordinary laymen—people who cannot afford to employ an accountant? We are not talking about city slickers or international bankers; we are talking about locum nurses, social workers, careworkers and hospital cleaners.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
The right hon. Gentleman’s point that these are not city slickers and tax-avoiding, money-grabbing sorts reminds me of my constituent, Caroline Cheasty. She was a social worker in the public sector, with 24 years’ experience in local authorities. She had a career break, and when she wanted to go back as a locum, she was advised to either form a plc or go with an umbrella company—that is what she did. She came to my surgery in tears. Does he agree that the Government should go after the promoters of these schemes, not the little people?
Mr Davis
I do. The hon. Lady tempts me into a political point, because the Blair Government were the most active promoter of these schemes, but she is right in general.
When something is as unclear as this tax law obviously was, we do not take the date of resolution from the first date that HMRC wins—we do not keep going until we get the answer that the Government want. We take it from the day it is finally resolved in the Supreme Court. The case was not finally and definitively settled by the Supreme Court until 2017, when it found in HMRC’s favour on the Rangers, Dextra and Sempra cases. The Government—this relates to the point made by my right hon. Friend the Member for New Forest West—then passed further legislation to clarify the law. Even after the court case, they passed legislation to clarify the law. If it was so clear, why did we need a new law in 2017? That is the fundamental point.
Dr Julian Lewis (New Forest East) (Con)
My right hon. Friend is making an unanswerable case in logic, but I would like to put another political point to him. The cause of tax avoidance is not normally associated with such parties as the Labour party or the Liberal Democrats, but I am sure he would acknowledge that Members from both those parties have played a leading role in trying to put this injustice right.
Mr Davis
My right hon. Friend is absolutely right. I started by saying that this is not a political issue; it is an issue of honour. As we would expect from our House—one of the greatest Parliaments in the world, if not the greatest—all sides take part in defending that honour.
Sir Edward Davey
The intervention from the right hon. Member for New Forest East (Dr Lewis) was spot on: this has brought the House together. The issue is not about tax avoidance. I think everyone on both sides of the House agrees that tax avoidance should be clamped down on, and there is no disagreement that the loan charge could apply in the future. What has deeply concerned many of us is that this is an offence against the rule of law, which is supposed to be a basic British tradition—one of our core values, which is taught in our schools. I therefore totally agree with the points made by the right hon. Gentleman.
Mr Davis
I thank the right hon. Gentleman—I nearly called him my right hon. Friend, from my days on the Public Accounts Committee.
When financial advisers and accountants could not understand the law, when employers could not understand the law, and when the courts could not agree on the law until 2017, how could an ordinary layperson possibly have understood the law?
The Supreme Court’s eventual decision, overturning three decisions before it, reflects changing national attitudes on the responsibility of the taxpayer—the point the right hon. Gentleman has just lighted on. As a result, one organisation representing the professions involved explicitly changed its guidance to its members. It said:
“Members must not create, encourage or promote tax planning arrangements or structures that…set out to achieve results that are contrary to the clear intention of Parliament in enacting relevant legislation and/or…are highly artificial or highly contrived and seek to exploit shortcomings within the relevant legislation.”
In what year was that changed guidance handed out by the professions? 2017.
Kevin Hollinrake (Thirsk and Malton) (Con)
My right hon. Friend is making some very good points, which I agree with. However, does he not agree that if something looks too good to be true, it usually is? In my business, we have been brought this kind of scheme a number of times by our advisers over the last 30 years, maybe with a barrister’s letter saying, “Don’t worry. It’ll be fine. You can reduce your tax bill hugely by adopting this scheme.” We have always rejected them because we knew the risk. Does my right hon. Friend agree that there is a requirement on the individual who subscribes to one of these schemes to make sure they understand the risks and that there is no guarantee the scheme will actually reduce their tax burden?
Mr Davis
My hon. Friend is, of course, a skilled businessman; he knows what he is doing, and he is across this sort of thing—it is his job to be across it—but I am not so sure we could say that about a locum nurse or a social worker. This issue was actually at the centre of Sir Amyas Morse’s arguments. He took the view that the attitude from 2017 should apply back to 2010, even though the law was not clear. He took the view that the principle of a taxpayer’s responsibility for their own tax affairs must be upheld. That is the point my hon. Friend is making, and it is right—but only when the law is clear. That means that the Government have a responsibility to make the law clear and not to punish ordinary, hard-working taxpayers when Ministers fail to live up to that responsibility.
HMRC itself seems to disagree on the importance of the taxpayer’s responsibility. Why do I say that? Because until 2014, it did not approach the individual taxpayers; it approached the advisers. It approached the companies that insisted—they did not ask, but they insisted—that these locums and social workers took up this option. HMRC went to the advisers until 2014—until the issue suddenly started to become quite controversial.
Last year, the Prime Minister himself commented on this issue. He said:
“The real culprits in this matter, if I may say so, are not so much the individuals themselves who have decided to use the loan charge as a way of minimising their tax exposure. It’s the people who advised them that it was a sensible thing to do. In my view, we should find a way of going after them.”
That is the Prime Minister’s view, and I happen to agree, unusually.
Mr Davis
If the hon. Lady will forgive me, I am trying to constrain my speech to 15 minutes, and it is beginning to be a struggle with so many interventions.
In summary, these people are now suffering because of a history of poorly drafted regulation and legislation and poor management by HMRC, targeted on the wrong people.
On many occasions, the Minister and his predecessor have told me and the House that the loan charge is not retrospective. In his report, Sir Amyas Morse states:
“The Loan Charge can look back 20 years…This design has been described by HMT as ‘retroactive’.”
The report describes the loan charge throughout as backward looking. HMRC denies that it is retrospective; it says it is retroactive. If I may say so, that is a distinction without a difference. When I looked up “retrospective” in a thesaurus, guess what it said? It defined the word as “retroactive or backward looking”.
Mr Davis
Yes, I will send HMRC a copy of Microsoft’s thesaurus. Not only that, but in paragraph 3.8 of his report, Sir Amyas states:
“The Review’s legal advisers found that there was no precedent for that element of the design.”
That is the retroactive, retrospective or backward-looking element. There was no legal precedent for that design. I hope, frankly, that the Government will now stop playing with words and finally concede that this is indeed a retrospective measure—an unprecedented retrospective measure.
The only just, fair and rational resolution is to remove the retrospective nature of the loan charge and set the cut-off date when the law became clear—when the Supreme Court finally settled the matter in 2017 and when the Government felt it necessary to legislate to make clear what they meant in the first place. That is why, as I made clear, if the Government do not act to address this issue, Parliament—all of us who take this very seriously—will have to act for them and make clear that, in the future, HMRC can under no circumstances act retrospectively. If we cannot solve this, here comes a Finance Bill. I suggest that the Minister should make one simple adjustment to his plans before they are published: change December 2010 to July 2017. That would resolve the issue. It would lift enormous pressure off 50,000 of our constituents, and it would put the Government in a morally defensible, justifiable and decent position.
Tax law is the only part of English law where “innocent until proven guilty” does not apply. If HMRC tells us we owe it money, then, until we prove otherwise, we owe it money. It is therefore very important that the law is clear—that it is not subject to reinterpretation by subsequent Governments and it does not move with social mores or whatever; it is simply clear. That is what we have to do. In the interests of natural justice and the financial and mental wellbeing of thousands of our constituents, it is time for the Government to change their mind and remove this harrowing burden from the 50,000 people who have been caught by it.
Christian Matheson (City of Chester) (Lab)
I intend to speak for only a couple of minutes. That is partly because of the outstanding introduction from the right hon. Member for Haltemprice and Howden (Mr Davis), which was clear, logical and unimpeachable—I congratulate him on securing the debate—but partly also because the situation is simple.
I am clear about two facts. First, disguised remuneration loan schemes—DR schemes—were clearly a tax dodge and were used for people to pay less tax. It is absolutely right, as the right hon. Member for Kingston and Surbiton (Sir Edward Davey) hinted, that we should close down those loopholes. However, it is also clear that the loan charge was put in place unfairly and unjustly as a retrospective measure. What is the proof of that particular pudding? Well, the right hon. Member for New Forest West (Sir Desmond Swayne) beat us all to it, and he is absolutely right. Why on earth did we need to introduce the 2017 legislation to introduce the 2019 loan charge if, as the Government and HMRC claim, these schemes were already illegal? They were not. That is why the loan charge was brought in. It is utterly wrong to bring in retrospective legislation and retrospective taxation as a result.
HMRC is entirely within its rights to look at up to five years of someone’s tax records, but only if the information that the individual has given to HMRC can be proved to be incorrect. We are talking about individuals who had their correct tax returns signed off by HMRC, which agreed that they were perfectly legitimate and lawful under current tax law but then reopened them, not because there was a suggestion that the individuals had provided incorrect information, but because the law had changed or was not quite as HMRC thought it was at the time it signed off those tax regulations. That is HMRC’s problem, not the problem of my constituents.
Fortunately, I do not know of any constituents who have taken their own life, but I do know of constituents who have lost their business and their house. One constituent’s marriage broke up. One young lad doing his first contracting job was told on the first day, “This is the way that we get paid in this place.” He did not know any better; he was 21 years old and just out of university. That was how he was encouraged by the employer and, incidentally, his colleagues to undertake the scheme. He does not yet know what his liability will be. Will it be £16,000? Will it be £60,000? The uncertainty is dragging him down. At the moment, he does not even feel able to work.
I congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) and echo the right hon. Member for Kingston and Surbiton, who says that it is not a party issue. Members will agree that it is a question of natural justice and fairness, and of not reopening tax returns that had previously been signed off by HMRC. By all means let us close the loophole, but let us not drag people into this dreadful sense of natural injustice.
Several hon. Members rose—
Mr Deputy Speaker (Mr Nigel Evans)
Order. Thirteen other hon. Members—in fact, more than that—want to get in, so I plead for short contributions of the length that we have just heard from Christian Matheson, otherwise we will simply not do justice to the next debate. I call Julian Lewis.
Dr Julian Lewis (New Forest East) (Con)
During business questions before this debate, I asked about the perennial issue of war widows whose pensions were stopped because they remarried or cohabited, and we were told in no uncertain terms that those pensions would not be reinstated retrospectively. On 6 February, I tabled a question to the Financial Secretary to the Treasury, who is present, about the apparent difference between the approach to war widows, who will not get retrospective pensions, and people who will be hit retroactively by the loan charge. I was told in the reply that the loan charge is not retrospective. We now know that the reason it is not retrospective is that it is retroactive, even if the two things are exactly the same.
I pay tribute to my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for taking the initiative over several months to try to put this right, to the all-party parliamentary group ably led by the right hon. Member for Kingston and Surbiton (Sir Edward Davey), and to our former colleague, Greg Mulholland, who has done a great deal of background research in support.
My understanding of the situation can be summarised as follows. First, uncertainties arising from IR35 legislation led tax experts to approve umbrella company loan schemes. Secondly, many self-employed public sector workers, among others, had no idea that they were being paid by means of such loans. Thirdly, if HMRC had been doing its job properly, it would have sanctioned the purveyors of those schemes and warned the victims, as soon as they sent in their first annual returns, that they were making themselves liable for charges.
Fourthly—this is quite incredible—such schemes are still being sold to thousands of people who clearly still have no idea what is waiting for them from HMRC further down the line. Fifthly, the Morse review’s decision to exempt people affected prior to 2010 leaves people who were bullied into making large payments relating to the years before 2010 unable to get those settlements rescinded. People actually paid money before the Morse review for a period that has now been exempted, and they could probably negotiate better settlements, if any were still needed, than those for which they paid money that they cannot now get back, because they cannot reopen the negotiation.
Sixthly, people acted in good faith on the best professional advice that they could get. They should not have been left in blissful ignorance for years on end by a Government body that is now playing catch-up. Because of the time constraints, I will not go through the harrowing personal testimonies, but will stick to a couple more theoretical points and then conclude.
Seventhly, it has been pointed out that there was something called part 7A ITEPA—part 7A of the Income Tax (Earnings and Pensions) Act 2003—which came into effect in December 2010, and this has been cited as justifying the decision for the loan charge to apply from 2010 onwards. However, I am advised by Alan Williams FCA, a constituent as well as a highly qualified professional, that this does not apply to the self-employed, so the self-employed who were so often the victims of this set-up ought not to be caught by a provision—by the assumed knowledge of a provision—that did not, in any case, apply to them.
An eighth point is that the loan charge is not, in any case, full and final settlement, and therefore does not close open years. Even those paying the loan charge will see HMRC continuing to pursue further sums for so-called protected years in which loans were received. The recommendation of Mr Williams is that those accepting the loan charge should be afforded finality by making the loan charge full and final settlement.
I come to the conclusion that HMRC fell down on the job. It was asleep at the wheel. It bullied the victims, and let the villains who created these schemes get away with it. HMRC in this case is not just a bully; it is a negligent bully. The Government should know when they are beaten both morally and intellectually, stop flogging this dead horse and finally do the right thing.
Sir Edward Davey (Kingston and Surbiton) (LD)
It is a pleasure to follow the right hon. Member for New Forest East (Dr Lewis). I am delighted to say that on this occasion I agree with every word he said. It is the nature of this debate that it has brought those on all sides together. For people who normally are not necessarily in total agreement on economic and tax affairs, this has brought us together. That is for the reason the right hon. Member for Haltemprice and Howden (Mr Davis) gave: it is about natural justice.
I set up the loan charge APPG last year, and I think it has become a group that illustrates the way in which the House has come together. We now have 227 members. My co-chairs are the hon. Member for Brentford and Isleworth (Ruth Cadbury) and the right hon. Member for Hemel Hempstead (Sir Mike Penning). I should say that he wanted to be here today, but he has a family issue that has kept him away.
Not only do we represent colleagues from across the House, but I believe we have gone about our business in a pretty professional way, with the support of the Loan Charge Action Group as our secretariat. We have produced reports in the past, and as a group we have reviewed the Morse review itself and published our response. That follows two witness sessions, where we had tax experts and loan charge victims. We have received more written evidence, and we have built on our previous work. This 63-page report, published today, has 17 key findings on the Morse review and it makes 19 recommendations.
I have been on a number of all-party groups during my time in the House, as I am sure you have, Mr Deputy Speaker, and it is relatively unusual for an APPG to do such a thorough and detailed report in such a short time. If I have one disagreement with the right hon. Member for Haltemprice and Howden it is that I wish he had given us a little bit more time to do our work before this debate, although I am really pleased that we have got this debate. I hope the Minister, whatever he says from the Dispatch Box in response to this debate, will undertake to read the APPG’s report and to respond to it.
When the Morse review was set up, we welcomed it; it is what we had been seeking. We had meetings with Sir Amyas, and we gave him a huge amount of material. It is fair to say—I put this on record on behalf of the APPG—that we welcome many aspects of his report. He talks about how unusual the loan charge is and how unique it is in respect of how it overrides statutory time limits, which are meant to protect the individual taxpayer, and how it looks back over 20 years. What an astonishing piece of legislation to put forward.
The report has a number of good recommendations. For example, it says that if the loan charge continues, after 10 years of repayment any remaining liability should be written off if the taxpayer has earnings of less than £30,000. One would have thought that that was a reasonable recommendation, even if the Government want to stand by the loan charge, but they have rejected it. The Government rejected even that relatively modest recommendation.
I would have thought that Her Majesty’s Treasury and HMRC would have agreed with all the recommendations, in the spirit of the Morse review, but they have not. They have rejected some in full and some in part, and they interpret some in a way that is clearly not intended by the Morse review. For example, one group of taxpayers about whom I have been most worried is those who have had closed tax years—in other words, their tax affairs, properly given to HMRC with all the relevant material and back-up, had been accepted and the tax year had been closed. There can be no doubt that going back to such a year is complete and utter retrospection, yet the Government are still seeking to apply the loan charge to those years. They have narrowed in a most outrageous way the way we consider the concept of a closed tax year.
I am really unhappy with the way that the Government have responded to the Morse review itself, but the review does have a big flaw at its heart. Because the right hon. Member for Haltemprice and Howden set out that flaw in detail, I do not need to speak for so long. In essence, Morse says that the law that was passed in 2011 in respect of the Income Tax (Earnings and Pensions) Act 2003, and particularly part 7A, made it clear. Now, the right hon. Gentleman showed that it did not make it clear, even for those people directly linked to it, because of the timings that he set out.
In specific detail, the expert witnesses whom we saw in the APPG made it clear that that legislation covered only some of the schemes to which the loan charge applies—those schemes that involved employees who were being paid via a third party—but completely omitted entire existing schemes that involve the self-employed, companies and loans paid directly to employees. There can be no doubt that the legislation on which Morse was relying does not apply to many people, because they are just not covered by that legislation. It is not a question of debate; it is just a fact.
At the time, experts looked at the legislation and responded in the way that one would expect: they looked at what the legislation said and changed their advice accordingly. Indeed, HMRC’s advice was based on what was actually in the Act, surprisingly enough. There is a 2016 technical note to which our report refers and in which HMRC specifically says that that is what the legislation said.
I find it quite extraordinary that successive Ministers have tried to defend this double-talk from HMRC. As the right hon. Member for Haltemprice and Howden said, no court rulings in any way interpreted legislation in the way that the Morse review does. I have a huge amount of respect for Sir Amyas Morse, but on this point he is entirely wrong. I do not read all the tax literature, but the tax experts who have contacted us are really clear that Morse is getting the legislation, as it was understood the time, completely wrong.
Bob Stewart
When the right hon. Gentleman took evidence from people who are subject to the loan charge, did he receive any evidence to the effect that their chartered accountants or financial analysts since 2010 had told them—the people they were being paid by—that they were in real danger and had better change the way in which they paid their taxes?
Sir Edward Davey
We took no such evidence and no such evidence was proffered to us. It might exist out there, but we have certainly not seen it.
I do not want to detain the House any longer, as I have made my core point. The whole reason why this has been such a big issue and has united the House is that the loan charge is retrospective, and that is unfair and wrong. We have to defend individual taxpayers, even if we think they might have been ill-advised in the first place. We have to defend the law. Why do we meet in this House? Why do we pass laws, unless we come back here and say, “Government—you’re breaking the law”, and hold them to account for that? That is our constitutional job, and I thank right hon. and hon. Members from across the House for doing their duty.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
I, too, congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) and others on securing this important debate, and thank the Backbench Business Committee for allocating the time. It may not be the most pressing issue that we are facing at the moment, but it does address the deeply held concerns of constituents caught up in this injustice; and I say “injustice” because I truly believe that that is what it is.
This debate is to look at the Morse review, which did have some welcome outcomes, but I do not believe for one minute that it went far enough. I believe that everyone has a duty and an obligation to pay their fair share of tax, and that anyone who evades tax should rightly be sought out and made to pay. But that is not what we are dealing with here. In many of these cases, we are dealing with ordinary people who were either forced or persuaded into schemes that they were advised were perfectly legitimate and approved by HMRC. And there lies the problem. By way of example, I will share with the House an account of one of my constituents who is caught up in this situation and is facing a bill for tens of thousands of pounds, and potential financial ruin. I know that the Government and HMRC have said that that will not be the outcome, but after looking at the details of his case, I assure the House that it would be.
My constituent is an intelligent individual, but by no means a tax expert. When he gave up his job in 2011, deciding to work freelance so that he could get a better work-life balance, he was advised to join a freelancer scheme—a scheme that was established and promoted by an ICAEW-regulated chartered accountant. The promotional literature unambiguously stated that the accountant’s scheme was
“anodyne, with no tax avoidance motive (HMRC words) involved”,
“legal and compliant” and
“supported by tax counsel’s opinion ”.
At no point did the chartered accountant mention any known or future possible risks, either verbally or in writing.
The chartered accountant simply positioned my constituent’s use of the scheme—through which he would receive a combination of salary and loans—as perfectly legal and an “effective tax planning tool”. That said, in mid-2012, having noted some adverse media coverage of the subject of tax avoidance, my constituent sought confirmation from the promoter that the scheme remained truly “anodyne”, as had been stated when he joined it. The promoter’s response was unequivocal—that nothing had changed.
Later in 2012, a copy of an HMRC letter addressed to the promoter and dated 20 June 2012 was forwarded to my constituent in validation of the chartered accountant’s previous assurances that the scheme was legitimate. The letter confirmed that for the purposes of mandatory disclosure under disclosure of tax avoidance schemes legislation, HMRC’s anti-avoidance group had formally reviewed the scheme and determined that it could apply no “hallmarks” of tax avoidance. Therefore, and of critical significance, HMRC stated that the scheme was “not disclosable”.
The unambiguous contents of HMRC’s letter gave my constituent absolutely no reason other than to conclude that its anti-avoidance group had undertaken a full, diligent review of the scheme and that, in the absence of any adverse findings, he could continue to use the scheme safely. But even then, as a cautious person, my constituent sought further confirmation from the promoter and was again reassured. Why would he not carry on using a scheme when he has sought so many reassurances? I restate: if HMRC had even the slightest concerns about the scheme’ legitimacy and/or my constituent’s use of it, its failure to openly communicate such concerns denied my constituent the clear and obvious opportunity to immediately depart the scheme in mid-2012.
As it is, HMRC notified my constituent in late 2013 that it had opened a formal section 9A inquiry into his use of the scheme, at which point he immediately ceased to use it. Regardless of that, to this day, more than six years after that section 9A inquiry into my constituent’s use of the scheme was launched, it remains open, and he has yet to receive any technical argument from HMRC as to why it considers the scheme unlawful.
It is very clear to me that HMRC sees the loan charge as a panacea for its historical and obvious failures. It is attempting to bypass my constituent’s basic right as a taxpayer to have a court rule on any alleged additional liability. We have heard from countless hon. and right hon. Members, and from esteemed independent tax practitioners, that HMRC must at the very least be forced to desist from using the loan charge to drive through these retrospective, unproven and ordinarily out-of-time claims, which predate the enactment of the Finance Act 2017.
I strongly agree with that viewpoint and feel that it would be undeniably unfair and entirely unreasonable to pursue people from before that date. Therefore, in the light of the uncertainties caused by the current situation with coronavirus and its effect on freelancer’s ability to work and earn at this time, may I please ask that the existing legislation be amended so that the loan charge is made prospective from 2017 onwards, which would remove at least one level of uncertainty for this important group of people at this very difficult time?
Several hon. Members rose—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. Colleagues will see that a number of hon. and right hon. Members wish to speak in this debate and the next debate. If we are to get everybody in fairly, I would ask that speeches should be five minutes.
Neale Hanvey (Kirkcaldy and Cowdenbeath) (Ind)
It is indisputable that everyone should pay their fair share of tax to fund our public services, and if recent events have taught us anything, they have illustrated that we all rely on the response of those services and that any future threat of funding must be resisted. However, the Government’s current position on this issue is, frankly, quite wrong and unjust. At £35 billion, the Government’s official estimate of tax losses is now the highest it has ever been, yet the true figure of tax avoidance by the super-rich and corporations could be as high as £120 billion a year.
My constituent Doug Aitken is facing a significant bill as a result of the loan charge. This is money that he simply does not have, and if HMRC persists, he will lose his home and his car, and, because he is self-employed, the resulting bankruptcy will lead to the loss of his business and his personal contribution to the Exchequer. Like many, he took independent advice from tax experts before entering the scheme and was reassured that it was operating entirely within the law. He declared his income and submitted his tax returns. He set money aside, ready to pay any tax liabilities, and he kept the money for the HMRC look-back period. He is not alone; a number of other constituents have contacted me about this matter. Some are retired or are now surviving on benefits. They simply do not have the resources to pay. Others have spoken of the significant impact on their mental health. Although the changes to the look-back period from the Morse report may exempt thousands from being pursued, thousands more are still facing the prospect of absolute financial ruin. This is nothing short of a disgrace and meaningful recovery is very unlikely, whereas bankruptcy is almost certain.
In closing, I would like to offer my reflections on the key argument put forward by Sir Amyas in favour of recovery. In his recent contribution to The House magazine, he explained that the advice he took about legality was from tax experts. However, he also notes that the contributions from those who entered the scheme’s evidence that they did not understand the implications—that is, they are not tax experts. Although Sir Amyas might have sympathy with the loan charge recipients, pursuing them now is very unlikely to lead to any meaningful recovery.
I previously served the health service ombudsman as a clinical expert, and I was advised that I should not assess the treatment and care provided against my gold standard practice level. Rather, my judgment should be tempered to a level of what one could reasonably expect. I would respectfully suggest that the current policy has measured those in the grip of HMRC over the loan charge against the gold standard of tax experts and not, as it should have, against the standard of what one would reasonably expect a lay person to understand. Although I firmly believe that individuals should pay the taxes they owe, ruinous action from HMRC will help no one. The Government must act now to completely remove all retrospective action.
Paul Holmes (Eastleigh) (Con)
I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) on securing the debate, and all Members who are members of the all-party parliamentary group for being here today. Having been in this Chamber for only four months, I am not as experienced as others in complicated tax arrangements, but, very quickly during my election campaign and during my surgeries, this issue has proven to be a huge worry for the many of my hard-working and honest constituents who run small businesses. For me, thankfully, this is not a debate that revolves around complicated tax issues. It is a debate that revolves around fairness and proportionality, and I think the Government have got that drastically wrong. That is where the Morse review has not gone far enough.
Like my hon. Friend the Member for South Basildon and East Thurrock (Stephen Metcalfe), I believe that everyone in our country must pay the taxes they owe—individuals, businesses, everybody. That is how a responsible society works. But the people this affects are not tax avoiders, so I have some concerns on behalf of my constituents about some aspects of the Government’s approach. I believe that it is my duty as a constituency MP to bring them up with Ministers.
Many constituents have come to see me at the surgery and have told me the severe pressure that this has put them under; the pressure of making payments and possible insolvency has, in some cases, caused the breakdown of marriages, physical exhaustion, and suicidal thoughts through no fault of their own whatsoever. I am also aware from my constituents that many of those who used some form of disguised remuneration scheme did so at the behest of financial professionals they had hired to advise them. Some were told that these schemes were HMRC compliant. Others were not even told that these schemes were tax avoidance and thought that they were normal procedure.
I want briefly to ask the Minister to consider the following points. Of course, any shortening of the time for which people affected are liable for these payments is welcome, but even after 10 years the payments over three years are too regimented and draconian. What thoughts has the Minister had about lengthening the terms? It is simply not fair of HMRC to impose the retrospectivity that follows from this review. As I have said, many people were advised by financial advisers and are now being penalised because of the late realisation and intransigence of HMRC. Does the Minister accept that that should not be a portent for any decision making on policy in this area? What steps is he taking to share the cost burden with the financial advisers who recommended these schemes? They are getting away scot-free.
Lastly, I want to raise the subject of HMRC. Even in normal times, it is not the most transparent Government Department, or the easiest to deal with; it is not known for its empathy or human nature. I really hope that the Government do not continue down this path, but if they do, it is vital that a bespoke, compassionate team be set up solely to deal with the vulnerable people in our constituencies who are affected by this issue.
Anthony Mangnall (Totnes) (Con)
That is a gross understatement of HMRC’s lack of compassion. If we are to move forward, HMRC must give individuals who have suffered as a result of the loan charge situation certainty that there will be finality in the way the issue is dealt with.
Paul Holmes
My hon. Friend is absolutely correct. His point backs up mine. Any team that the Treasury sets up—and there should be one—to deal with people affected by the issue should treat them as people, not as numbers, which is unfortunately how HMRC has a track record of treating them.
Richard Fuller (North East Bedfordshire) (Con)
My hon. Friend puts his finger on one of the core points. Who is running the show here? Is it HMRC, or are the Government making sure that law on this matter is paramount? Does he not find it ironic that HMRC’s annual report this year says that HMRC wants a system that can
“be trusted and seen to be fair, with the right safeguards in place to protect customers”?
Does this case not show that it is falling woefully short of meeting that ambition?
Paul Holmes
I agree entirely. This is not the only case of people being treated unfairly by HMRC. I really hope that the Minister listens to the concerns being expressed across the House, particularly about the issue under discussion. There is a wider point here about HMRC. As my right hon. Friend the Member for Haltemprice and Howden said, it has decided to charge people retrospectively although the situation arose through its negligence. Never again—I feel this strongly—should it be allowed to adopt retrospective measures to cover its failure to get its policies in order.
Lastly, the Minister needs to make it clear, hopefully today, that the people affected by this are victims. They are struggling after following advice given to them by independent tax experts. I hope that he will look at lengthening the repayment period, commit to dealing fairly with the people affected by this, and never allow this to happen again. Ideally, he should at the Dispatch Box this afternoon scrap the loan charges affecting so many of my constituents.
Allan Dorans (Ayr, Carrick and Cumnock) (SNP)
I pay tribute to right hon. and hon. Members on both sides of the House for their eloquence and the detail of their arguments. That will save me some time in my speech, and allows me to give the perspective of one of my constituents. I received a number of constituent inquiries on this subject, but I highlight just one.
In 2008, one of my constituents was a pilot employed by Ryanair. His conditions changed and he was forced to become self-employed. He attempted to register as self-employed, and was asked a series of questions by HMRC, including, “Do I supply my own equipment?” Obviously he did not; Ryanair supplied the plane. “Can I work for who I want?” Absolutely not; he was on the Ryanair rota. “Can I nominate a substitute?” He could not, because he had registered with Ryanair and was allowed to work only so many hours. He could not honestly answer yes to these questions, and so could not become self-employed, although a number of his colleagues did. He, though, was an honest man, and he decided not to.
My constituent looked for alternatives, and found a company on the Isle of Man—a group of qualified and recognised accountants who, for payment, presented him with a legal solution, known as an employee benefit trust. He did not really understand the implications of that solution, but he did his due diligence, and found that it was indeed legal and acceptable to HMRC. He proceeded with that system for four or five years, and filled in his tax returns legally every year on time, declaring his usage of that scheme. He was made aware of the loan charge in 2019. He came forward to HMRC straightaway and offered settlement. He assumed HMRC would treat him as an employed person and charge him for the tax he was due to pay, so he waited for the settlement figures and, in the meantime, paid £30,000 in accelerated payment notices—in fact, an advance payment of tax.
That year, he received a bill of £213,000, almost half of which was made up of interest and penalties. There was no allowance for the vast expenses he incurred. Ryanair made him pay for taxis, hotels and even water, and he had no pension relief. HMRC did not deduct the APNs he had previously paid, and he had provided all this information. He is still in dispute with HMRC.
None of that is fair. This has been a life-changing experience for him and his family. He has been treated like a criminal. He has not evaded tax law, he believes he has acted legally at all times, and he refuses to allow HMRC to ruin his life due to its incompetence. He believes this is nothing more than bullying of individuals by an all-powerful and out-of-control Government body that should rather be pursuing the people behind such schemes.
I will keep my speech short, as I appreciate we are short of time. In the interest of natural justice and fairness, I support the motion:
“That this House believes that the Loan Charge is an unjust and retrospective tax; notes that the law on the Loan Charge was not settled until 2017; and calls on HMRC to cease action on loans paid before 2017.”
Bob Stewart (Beckenham) (Con)
In 2018, when a group of constituents first came to my surgery to complain about their treatment by HMRC, I was not particularly sympathetic—they were talking about loan schemes, of course. After all, why should a group of people use schemes to pay less tax than the rest of us? If they do not pay their fair share, others have to make it up, or so I thought. I was actually too harsh, not because people should not pay their fair share of tax, but because I did not understand the circumstances until they explained their predicament.
First, the people I met were clearly not out to defraud the system. They did not look or sound like petty criminals. They were normal, decent and honest. Some explained that they did not even have a choice, as we have heard: either they used a loan scheme or they would not be employed by the company or, in some cases, the state.
Secondly, as self-employed individuals, they were often contracted to different entities. Nobody but themselves, from what they earned, put aside anything for pensions, sick leave, paid holidays or, indeed, guaranteed employment. They were much less secure than someone with a permanent job.
In the interest of being quick, I have four requests of the Minister. First, I would like to see the retrospective nature of the charge removed up until July 2017, when the Finance (No. 2) Act 2017 was introduced. That makes sense to everyone.
Secondly, if that is not possible, the Government should revisit the settlement terms, which are hugely punitive. We have just heard the hon. Member for Ayr, Carrick and Cumnock (Allan Dorans) say how punitive they are, and I would like to see a radical reduction in extortionate interest rate charges and inheritance tax demands.
Thirdly, we would all find it distasteful for the Government to send out settlement terms using words that imply people have deliberately broken the law—they did not. HMRC allowed the use of loan schemes every year. It sent the tax returns back, and people thought they were doing right.
Finally, I see no reason why loan charge repayments should not be delayed by a year, rather like IR35, in response to the health crisis we are all facing. So many people are worried enough at the moment. Give them a break—give them another 12 months.
Bambos Charalambous (Enfield, Southgate) (Lab)
Let me say from the outset that I am no fan of tax avoidance. The law on disguised remuneration schemes should have been—and now has been, rightly—tightened, but the aggressive retrospective action taken by the Government in pursuing the loan charge policy and the profound effects that this has had on many people’s lives are quite simply unjust and unfair.
A significant number of people affected by the loan charge policy, including some of my constituents, are freelancers, contractors, locums and agency workers. When IR35 was introduced by the Government of the day in 1999, some of those who were employed by limited company or personal service companies sought and took professional tax advice and were advised to use umbrella company loan schemes instead, as those schemes were “tax law and HMRC compliant”. Acting in good faith and following the advice to the letter, many entered into these loan schemes. In some cases, particularly in the public sector, people were not even aware that they were being paid through loans.
When the loan charge was introduced in 2017, seeking to recover a 20-year retrospective tax charge for all remuneration paid in the form of a loan, those affected were rightly angered and aggrieved, particularly as HMRC lumped all the loans together into one and insisted on the tax being paid in a single year. The shock and stress of such a draconian and unjust measure caused intense pressure on many of those affected and their families. There have been seven known suicides by people who are facing financial ruin as a result of the demands of backdated tax from HMRC, even though it is questionable whether the tax was even owed. Relationships have broken down, and it has affected people’s mental health.
It is worth noting that HMRC has pursued individuals acting in good faith, rather than those who enabled the disguised remuneration loan schemes. Thankful for small mercies, the fact that HMRC is now only pursuing schemes going back 10 years, instead of 20, is to be welcomed, but many individuals are still caught by the current situation. It seems that, unlike in other areas of law, statutory time limits are of no consequence.
When the Prime Minister was running to be leader of his party, he promised a review of the loan charge situation. That review was led by Sir Amyas Morse, and the report was published in December 2019. While I welcome the recommendations of the Morse report, many of which the Government have accepted, unfortunately it does not go far enough. The report also has one fatal flaw: it concludes that the law was clear from 2010. There were a number of ambiguities at the time, such as the situation relating to those who are self-employed. If the law was so clear at the time, why did HMRC not enforce the law then, but instead choose to introduce the loan charge in 2017?
As a member of the loan charge all-party parliamentary group, I call on the Government to do a number of things. I ask them to amend the date from which the loan charge applies from 2010 to when the Finance Bill received Royal Assent in 2017; to ensure that closed tax years remain closed; to ensure that those with incomes of under £30,000 have any outstanding balances written off after 10 years; and to ensure that legislation covers business owners and directors, as well as individual contractors.
The Government and HMRC’s reputation has been damaged by the way that they have mishandled the loan charge situation. One principle that must underpin our legal and tax system is that things should be just and fair. Unfortunately, the loan charge and its aggressive application has been neither just nor fair.
Sally-Ann Hart (Hastings and Rye) (Con)
The hon. Gentleman talks about the system being just and fair. As British people, we uphold the rule of law. That is part of the very nature and fabric of Britain. Retrospective legislation, in itself, is against the rule of law.
Bambos Charalambous
The hon. Member makes an excellent and pertinent point. We are discussing tax going back 20 years, and retrospective legislation should not be applied in this situation, because that is clearly unfair and unjust.
We must consider that, beyond the financial aspects of tax recovery, we are dealing with real people who need to be treated with fairness and respect. We have a moral duty to ensure that no more homes are lost, no more bankruptcies are filed, no more lives are lost and no more families are broken because of the loan charge policy.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
Like many of those who have spoken in this debate, I have met many constituents, during the election and since, who have been directly affected by this issue. I have had the chance to go through with them many of the contracts they have signed and some of the advice they received from many of the professionals, who, we would all agree, based on what has been said today, are the villains of the piece from the perspective of this House. I have heard many examples of where professionals were paid and people should have been able to rely on their providing good, clear and legal advice, but they have left those people in a difficult financial position today.
I sympathise with the position that Sir Amyas Morse found himself in, and I believe that what he has put forward in his report, although a number of points and concerns remain, represents a reasonable attempt at a compromise to bring about a resolution of this situation. It is my understanding that many of these legal cases revolve around the question of how we define a loan. The position of the Inland Revenue, as it was, and now of Her Majesty’s Revenue and Customs is that money that someone receives for doing their work and that they spend as their income is their income and should be taxed as such. The Inland Revenue and HMRC have always permitted both employees and directors to receive loans from the organisations for which they are working. Indeed, many of our constituents will have access to things such as season ticket loans, provided on a regular basis, which are free of tax because they are loans.
From reading the contracts that many of my constituents have signed and having heard in detail the advice that they received, it seems clear that at the heart of this is a fundamental problem: the schemes themselves were lawful because it was lawful to receive a loan, but the money the constituent received was tax-free only if it was genuinely a loan. But as five, 10, 15 or 20 years have gone by and there has been a complete absence of evidence that these things were genuinely loans, because the person has received that money as remuneration and spent it as their income, HMRC has naturally begun to take a lot more detailed interest in that, and this situation has left many of our constituents in a real bind.
I am mindful that, when we read Morse’s proposals, we see that he proposes a process of resolution containing a number of different avenues that the individual taxpayer affected can explore. I hope the Minister will consider that somewhere at the heart of this is making sure that individuals who acted in good faith, notwithstanding the fact that they were badly and incorrectly advised by professionals, should be enabled to have the benefit of the fact that they acted in good faith when they signed their tax return, even if the information on it, prima facie, was not correct. They were not intending to evade tax and thought they were doing something that was within the law.
In summary, I am also conscious that although we have heard a vocal campaign on this during the election campaign, 99% of taxpayers in this country never go near a scheme such as this. Quite a few of those taxpayers have said to me that they find it hard to credit that anybody thought that by describing the pay they received for their work on their tax return as a “loan” that meant they did not and never had to pay any income tax on it.
Mike Amesbury (Weaver Vale) (Lab)
Jeff in my constituency, who is hard-working, played by the rules. According to the rules, as far as Jeff was concerned, and as advised by accountants and even by HRMC, everything was in order. He was doing a good job and paying his way. As Members from across this House have said, this is about fairness and justice.
David Simmonds
Everybody in the Chamber is going to agree with that point, but fairness and justice clearly extend to this Chamber making decisions that are appropriate for everybody. I am very mindful of what my hon. Friend the Member for Beckenham (Bob Stewart) said about ensuring that everybody pays their taxes and everybody is treated fairly. I simply say this: there has understandably been a huge outpouring of sympathy towards people who did not expect to find themselves facing a very substantial tax bill because they thought they had done the right thing. I urge Ministers to be as helpful and as considerate as possible in approaching the settlement of that, but it is also clear to me, as someone who worked as a professional in the financial advice business—not as a tax adviser—when these schemes were being rolled out, that huge numbers of people avoided them, because they recognised that they were being asked to put something on their tax return that they knew was not correct. We therefore have to strike the right balance in how we deal with the issue today.
Matt Rodda (Reading East) (Lab)
It is a pleasure to speak in this important debate. I will be brief and focus my remarks on two or three key areas that have been partially mentioned by some colleagues earlier. I thank the right hon. Member for Haltemprice and Howden (Mr Davis) for securing this debate and commend the work of the all-party parliamentary group and the cross-party nature of the debate today, which is helpful.
First and foremost, I put on record my fundamental support for a fair tax system. We obviously need to raise taxes to pay for vital public services, but that system clearly has to be fair. I think that the points made by a number of colleagues across the House on the matter are absolutely right, and I am grateful for the emerging consensus on the issue.
Secondly, I highlight the importance of the issue of the loan charge. The fact that this debate is taking place today in a period of sustained national crisis—indeed, it is a crisis for the whole world—is interesting, and it does underline the importance of this issue. I was approached about it a number of times during the general election, like many Members here today, and I have had constituents contact me about it. There is deep unease in the community, certainly in the constituency I represent, which is made up of Reading itself and the neighbouring town of Woodley, about the problem, which affects many people. I noted the figure of 50,000 people across the country. It certainly seems to be higher than that, given the proportion of people in my community who seem to be affected.
I draw Members’ attention to the effects on a typical town of its type, as Reading is, and specific industries where I believe there may be a particular likelihood of the problem arising. In the area I represent, a very large number of people are self-employed and have microbusinesses or work as consultants in one form or another. That is spread across a huge range of sectors, from traditional small businesses through to people with trades or IT skills and public servants. It is a vast range of people.
I want to add to the point made by my hon. Friend the Member for Ealing Central and Acton (Dr Huq) about locums in public services affected by the issue. I know of cases where a number of people in public services have to set up as a company and work on that basis, perhaps as a supply teacher or in some other interim role in public services. I should declare an interest, as I have certainly operated in that way in the past as an interim public servant. In the more distant past, I was a full-time civil servant. Locums are a well-known type of employment and a subset of those people—not all of them—are affected by the loan charge.
As well as my area, many other nearby parts of the country have similarly high levels of employment in IT. There is a particular prevalence of self-employment among IT professionals. If we think of the great IT businesses in this country—companies such as Microsoft, Oracle or Vodafone—many of them are headquartered in the Thames valley or west London. Many of those large businesses rely heavily on subcontractors who have often no choice but to set up a limited company that then serves the much larger organisation.
In my area, many people who are affected by the loan charge are in the IT industry. There are whole WhatsApp groups of people in parts of the IT industry that are buzzing with concern about the matter. As has been said, the issue ranges back over many years and there is deep uncertainty and pressure on these workers and their small businesses and, indeed, their families, because of this whole problem. As I said earlier, we are debating this issue at a time of national crisis. Imagine how that concern overlays itself on top of the existing pressures that we talked about earlier today and yesterday. Quite rightly, we in this House have discussed and raised with the Government the importance of supporting small businesses at this time of national crisis.
Imagine how it would feel to be a small business person or an IT subcontractor who was the breadwinner in their family. Their source of income could dry up because of this crisis, which is not of their making and that they have not anticipated. At the same time, they face the long-standing problem of the loan charge looming over them, with the very grave measures that other colleagues have mentioned today. Some of the examples that have been mentioned are truly dreadful. Imagine that pressure. That is what we need to do today—to think about what it feels like for somebody who is a small business person or self-employed. I know the Minister is dutiful and well-read and, as was said earlier, he has written a biography of Adam Smith. I hope that he will look again at the evidence clearly and thoroughly and in the context of the current situation affecting small businesses.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I thank the Backbench Business Committee for allowing the debate when I know they had a backlog of requests on many important issues. I also thank my fellow sponsors of this debate, my fellow chairs of the loan charge APPG, particularly the right hon. Member for Kingston and Surbiton (Sir Edward Davey), and the right hon. Member for Hemel Hempstead (Sir Mike Penning), who cannot attend today because he is dealing with a family medical emergency. We wish him well.
I also thank the officers of the loan charge APPG and the action group. I can confirm that the three co-chairs of the APPG, from three different parties, all endorse the APPG report that was released tonight and is on our website. It is a pleasure to follow so many Members who have described in vivid terms the experiences of their constituents, so I will not dwell on those too much. I have similar experiences.
This is a time of incredible worry for most people in this country for their loved ones, their neighbours and themselves, and many of our constituents—perhaps most of them—are facing catastrophic and even absolute loss of income. While this debate is wholly unrelated to the covid-19 virus, for the victims of the loan charge scandal, who are already worried about their financial futures, the coronavirus outbreak only heaps more agony on top.
I agree with the points that others have made about tax avoidance, but this is not about tax avoidance, which we abhor and would like to see closed down. This debate is about natural justice, as has been said by so many. When the APPG started, the Treasury and former members of the Government said there was no problem with the loan charge and it was a perfect piece of Government policy. They said there was no need for a review of the policy. The right hon. Member for Kingston and Surbiton tabled an amendment calling for a review, we had a debate in the Chamber almost a year ago and a Treasury report that was a whitewash, frankly. Meanwhile, more and more Members were being contacted by worried taxpayers describing the bullying of HMRC and their fears for themselves, their families and their work. We kept standing up, we kept asking questions and we kept lobbying Ministers.
The Prime Minister, in his leadership bid, promised to hold a full review of the loan charge. We have had the review, led by the highly respected Sir Amyas Morse, whose report was released on 20 December, and on the same day, HMRC released its response. For taxpayers, the Morse review means that they are looking to the future, but I have heard several extremely troubling cases from my constituents who face the loan charge. This is about HMRC behaviour. In one case, my constituents provided all the information asked for and heard nothing back for two years. They received a note from HMRC saying they were facing the loan charge with interest added, including for the two years when they had had complete radio silence from HMRC. How is that justified or proportionate? Based on evidence to us, and I assume to Sir Amyas, along with casework and conversations with colleagues, including some casework wholly unrelated to the loan charge, it feels as though HMRC is just not capable of providing a competent service.
Others today have rightly mentioned the anxiety and uncertainty of taxpayers as they are chased for almost immediate payment of sums that they just do not have, and without any justification for the amount demanded. Usually, any previous information that they may have sent to HMRC is completely ignored.
I just want to touch briefly on poorly paid and vulnerable people. The Morse review recommended that, after 10 years, the loan charge should no longer apply to people who earn less than £30,000 a year, but the Government rejected that recommendation. Let us remember that many of these people are working in the public services—in the NHS and local authorities—and many of them do not have accountants. Many were effectively in a position where they were told that, if they wanted this work, they had to sign up to this umbrella scheme. The head clients will now no longer contract with personal services companies, so these umbrella schemes are all that is available to them.
We have social workers, junior doctors, nurses, cleaners and so on facing many charges year after year. To address this injustice, Sir Amyas made a reasonable request. It was that HMRC should not chase loan charge payments between 2010 and 2016 if the individual made a reasonable disclosure, but the words “reasonable disclosure” were changed by the Treasury to “full disclosure”—a term which, according to tax experts, has little or no relevance in tax law.
Where do we go from here? For months and months, we have heard the Government say that this is not a retrospective matter, yet they made an agreement with Sir Amyas Morse and shifted the date that the loan charge applied from 1999 to 2010. If they can change their mind once, surely they can do it again. If the Government can defer the roll-out of IR35 to the private sector, as they did earlier this week following extensive concerns, they can change their mind on the loan charge, I hope. The new suggested cut-off date of 29 December 2010 is based on the law being clear, yet we know now that this was not the case. If the law was clear then why did we need the loan charge and another change in legislation in 2016?
I would like very briefly to list some of the concerns that are in our report but that have not yet been raised in this debate—[Interruption.] Madam Deputy Speaker is coughing at me, so I urge anyone reading Hansard or watching this debate to please look at the report that we released last night. It is on the loan charge action group and the loan charge all-party group website.
In finishing, let me return to a core question. Is applying the loan charge from 2010 justified and proportionate? The answer to that from the all-party group is, no, it is not. I would go further and ask: is HMRC abiding by Adam Smith’s principles of fair taxation, which were mentioned at the beginning of this debate. Furthermore, are HMRC and the Treasury abiding by the Nolan principles of public service, particularly selflessness, objectivity, accountability, openness, honesty and leadership? I urge the Government to listen to the strong opposition to this retrospective, unjust and unfair tax and, quite simply, to do the right thing.
Sarah Olney (Richmond Park) (LD)
Madam Deputy Speaker, I will obey your instruction to be brief by merely commending the contributions to this debate from the right hon. Member for Haltemprice and Howden (Mr Davis) and my right hon. Friend the Member for Kingston and Surbiton (Sir Edward Davey).
I merely add that, as a member of the accounting profession, I have been somewhat abashed during this debate. We are not coming out of this well. I was contacted by a constituent of mine, Dr Nausheed Baig, who is an NHS dentist. He is there to practise the skills of dentistry. He takes full responsibility for his tax affairs, and he does that by consulting a professional tax adviser. I believe that HMRC should always take into consideration the fact that taxpayers, in taking responsibility for their affairs, are not expected to be tax experts themselves, and it is perfectly reasonable and rational to consult and take advice from qualified accountants such as myself—I have never charged for tax advice, so I do not have a declaration to make.
I wish to raise the case of another constituent of mine, Mr Michael Bilton, who is now retired, and his wife is on the verge of retirement as well. Between them, they take care of their disabled daughter. Mr Bilton was in a loan scheme prior to 2010 and received notification only a few years ago of the large sums of tax that he was now required to pay. He has already paid a considerable sum. The outstanding liability is of considerable concern to him, as he and his wife prepare for retirement and to take proper care of their disabled daughter. I urge the Minister to think about those people who have already paid large sums. Sir Amyas Morse has confirmed that anything prior to 2010 should not be liable to a charge. I urge the Minister to consider rebates for those people who have paid vast sums already into a scheme that has now been judged not to give rise to a charge. I realise that there are considerably more pressing issues, but if that could be attended to in due course, I would be extremely grateful.
Fleur Anderson (Putney) (Lab)
I, too, congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing this important debate at a time of national crisis. This is a crisis for 50,000 people across the country, and it will exacerbate the already difficult mental health and economic situation they face. I welcome the agreement we have heard across the House during the debate.
Let me make it clear at the outset that the debate is not about protecting and keeping in place loopholes and avenues for tax avoidance. I join other Members in saying that tax avoidance is a scourge, and any initiative or legislation aimed at tackling it has my full support. However, I do not support cruelly punishing more than 50,000 people and their families—hard-working entrepreneurs who acted in good faith—and often driving them to suicide. I have met many constituents at surgeries who have been in tears as a result of the effect of this issue on their family.
One constituent was hit with a bill for £158,000 plus interest five years after retiring. There is no way that he can repay that charge. He was advised by his accountant in 2007 that entering into employment via a loan remuneration scheme was entirely legal. That is a theme among the constituents who have come to see me. They say they found out that these schemes were QC-approved, they felt they were entirely legal and they did their due diligence, but the law has failed them. Although the Government’s decision to accept most of Sir Amyas’s recommendations is a very welcome step, the loan charge is still grossly unfair and is destroying lives in my constituency and across the country.
In the interests of time, I will cut to the six changes that I urge the Minister to consider. First, he should call off the dogs during the coronavirus situation and remove the threat of these huge charges from our constituents. This is a mental health crisis for many people. Secondly, the date that the loan charge looks back to should be amended from December 2010 to the date of Royal Assent of the Finance Act in July 2017, as the law was not clear.
Thirdly, the Government should accept the Morse review recommendation that unprotected or closed tax years should remain closed. Fourthly, they should accept the Morse review recommendation that people with incomes of under £30,000 should have any outstanding tax balances written off after 10 years of making a genuine attempt to pay on the terms that have been announced. Fifthly, the legislation must treat business owners and directors equally with individual contractors. Finally, anyone still using these schemes—I was astonished to find out that that is still going on—should be told immediately of the liabilities that they face.
We have to tackle tax avoidance, but using retrospective charges, which are ruining the lives of hard-working contractors and entrepreneurs and putting them in hundreds of thousands of pounds of debt overnight, is not right or just. The companies that promoted these schemes should be penalised, and the Government should accept the blame.
Chris Stephens (Glasgow South West) (SNP)
Let me first congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on his brilliant introduction to this issue and on standing up for the victims of this scandal—and it is a scandal. I am a proud member of the all-party parliamentary loan charge group.
Two constituents, Fraser Kennedy and Jason Millington, have been in regular contact about this issue. Indeed, one Monday morning, as I was travelling down to Westminster, I got the fright of my life when I saw the number of Twitter notifications I had. It surprised me because it had been a quiet weekend, so I knew I had not said or done anything particularly controversial—at least not that particular weekend. It was a tweet from Jason Millington, who said that what had kept him going was that he had the support of me and so many other MPs in fighting this injustice.
Patrick Grady (Glasgow North) (SNP)
I congratulate my hon. Friend on avoiding controversy and recommend that for all Scottish National party MPs.
I have had two constituents get in touch and I have tried to make representations on their behalf, because they found themselves in a situation that they absolutely did not intend to be in because of the information that they were given. Does this not show the importance of constituents getting in touch with us? I understand from the people running the all-party parliamentary loan charge group that there may be more such constituents out there, and it is very important that they contact their MPs so that we can give them tailored advice and support.
Chris Stephens
My hon. Friend is right; that is very sound advice. Everyone who has spoken so far today has been a credit not just to the House, but to their constituents, because there are far too many people—such as my constituents, his constituents and others—who are in despair because of this issue.
Richard Fuller
On the importance of Members of Parliament speaking up, is the hon. Member concerned, as I am, that effectively, HMRC is smearing constituents as tax dodgers and adding to their mental anguish, rather than trying to assist them through this process?
Chris Stephens
I am not only very concerned, but angry about some of these actions and what I have heard today about what HMRC is up to. I will speak more about that.
When constituents such as Fraser Kennedy and Jason Millington come to us to discuss this issue, three immediate things leap out at us. This has come up in the debate, including in a fantastic example from my hon. Friend the Member for Ayr, Carrick and Cumnock (Allan Dorans). In this Parliament, we really need to deal with the relationship between an employer and a worker and their status in the workplace, because it really is time to end the bogus self-employment that we have heard about in this debate and in other examples. This needs to be addressed because what this issue has proven is that the wrong people are being targeted.
The hon. Member for Beckenham (Bob Stewart) said that when people first come across this issue, it looks like some sort of tax avoidance scheme, and I think it is perfectly natural for someone to think that when it is first explained to them. In the back of my head, when I first heard about it, I thought, “Well, maybe I will approach HMRC as an MP and try to get the same sweetheart deal that Google got only a couple of years ago,” when it paid the equivalent of 4% corporation tax. It seems that there is a disproportionate way that the people who have been caught up in the loan charge are being dealt with compared with other people who can get a sweetheart deal. That is how I thought I could try to deal with it, because if the answer is, “Yes, it is tax avoidance”, then the people HMRC should really be going after are those who contrived and promoted such schemes, because they are the ones who are directly responsible. They should be pursued and punished, and there should not be the blunt instrument that is being used for those caught up in the loan charge.
The third conclusion is, as the hon. Member for North East Bedfordshire (Richard Fuller) said, that there have been disproportionate actions from HMRC towards the individuals who have been caught up in this and how they feel. My constituent, Fraser Kennedy, sums it up well. His employer, Winchester, assured him and HMRC that it had paid all the tax and moneys, but he is still getting chased by HMRC. He feels bullied and harassed, and is suffering from stress and anxiety because of how it has handled the matter. He believed that it was settled a year ago, but he is still getting correspondence.
Paul Holmes
The hon. Member’s speech perfectly sums up the problem for many of my constituents in Eastleigh. So many times, they get a letter and desperately try to get through to HMRC, but there is no constructive dialogue with HMRC. Does he agree that we need a better bespoke team to work with the people affected by these measures?
Chris Stephens
I entirely agree. The hon. Member’s constituents in Eastleigh and my constituents in Glasgow South West will have the same feelings about this matter and how they are being treated.
Jason Millington emailed me his thoughts last night, because he knew that the debate was today. He said that he when he was advised of the changes in 2016, he stopped immediately and put his affairs in order, totally unaware that HMRC was looking for back taxes. The requests that are being made are entirely unreasonable. The stress of not knowing how he can ever repay what HMRC is looking for is having a serious impact personally, and indeed professionally. I do not remember the tax avoiders such as Google complaining publicly that they were feeling bullied and harassed, or that they were under stress or feeling anxiety. It seems appropriate to point out, as many hon. Members have, that if the law on tax was changed in 2017, that is when the law should apply from. Going back to 2010 is entirely unreasonable. I support the motion.
Peter Dowd (Bootle) (Lab)
It is a long time since I read Adam Smith, but as I recall, the fourth maxim goes along the lines of, “Take from the taxpayer only that which is needed for the public realm.” Of course, the converse of that is that the more people do not pay their taxes, the more the rest have to pay to balance up, so Adam Smith’s statement is not absolutely unambiguous.
As almost everyone has said today, tax avoidance should not be allowed. It should not be encouraged. It should be discouraged in any way possible, because the rest of us who do pay our taxes have to support those who do not, so I do not have a problem with the concept of clamping down on tax avoidance. Retrospection has been used since the second world war, but it has always been commensurate with the needs of the nation. I do not want to get into a big argument about retrospection, but the issue is there. An excellent document from the House of Commons Library sets it out perfectly reasonably, and people have to take their own view.
I completely accept that many people took advice from a variety of organisations and that advice was wrong. I do not dispute that. These enablers ripped people off. Their scams were like other scams we have had, whether it is the recent leasehold scam, the payment protection insurance scam, or the endowment mortgage scam. These scams have existed for a long time, as the south sea bubble scam shows. They go back an awfully long time—
Peter Dowd
Precisely—before the right hon. Gentleman was a Member, although not much before, I imagine.
Bob Stewart
It might be dangerous to intervene here, but I am quite sure that a lot of these financial analysts and chartered accounts honestly thought they were doing the right thing and everything was legal. They acted in good faith. I do not suppose that all of them were slightly dodgy.
Peter Dowd
Well, that is a view. The hon. Member for Thirsk and Malton (Kevin Hollinrake) talked about how something that looks too good to be true is too good to be true. People have to take that on board when they become in involved in such schemes, as lots of people have, right across the spectrum, from those who are pretty wealthy all the way down to people who earn quite small sums.
It is the responsibility of this House to ensure that people are treated fairly. I do not want to get into the argument about whether HMRC has treated people fairly or unfairly. I accept in good faith what Members have said today about how their constituents have been treated. That has to be set in the context of the issue of HMRC’s resources. A third of its staff have gone since cuts in 2005 and later in 2010. Any increases in the cash amounts available to HMRC for its running have, in effect, been blocked. That is a factor that we must take into account as well.
The primary issue here is whether the enablers—the people everybody has talked about today—are getting away scot-free. I suspect that the Minister will tell us the extent of the Government’s and HMRC’s action to tackle these enablers, but I suspect that it will not be enough and the Government will have to sharpen up their footwork.
Whether HMRC has been aggressive is, again, a moot point. However, we know some of the enablers have also been incredibly aggressive. The Rangers FC issue trundled on for the best part of 13 years, with enablers—the accountants and lawyers—taking it right to the line and beyond, so let us not pretend there was not aggression from those who were attempting to push and push the boundaries, hence the reason for commensurate potential retrospective legislation.
I do not want to take much time, and everything has already been said today. It is important not just that the letter of the report and all its recommendations are put in place, but that the spirit of the report in relation to closed cases and so on is taken into account, and specifically the recommendation for a £30,000, 10-year limit, which the Government rejected.
The Government should have a word—I put it as gently as that—with HMRC about people’s perception of how it has behaved. It is important for Ministers to get that view across to HMRC. As the hon. Member for Ruislip, Northwood and Pinner (David Simmonds) said, it is about balance. We need balance in dealing with this matter, and I hope the Government can get that balance right.
The Financial Secretary to the Treasury (Jesse Norman)
I congratulate my right hon. Friends the Members for Haltemprice and Howden (Mr Davis) and for New Forest East (Dr Lewis) and the hon. Member for Brentford and Isleworth (Ruth Cadbury) for securing this debate today, and I thank colleagues on both sides of the House for their contributions. It is a measure of the effect they perceive on their constituents that, in these circumstances, they are here in such numbers.
The outbreak of covid-19 has created extraordinary circumstances, and it is important to say up front that the Government are keeping the situation under close review, as elsewhere, and will take a proportionate and reasonable approach to anyone covered by the loan charge who is unable to file their return by 30 September. That date has been moved back to give people enough time to respond to the Morse report and its recommendations, but the Government will insist that HMRC takes a proportionate and reasonable approach to anyone covered by the loan charge who is unable to file their return by 30 September.
Anyone who believes they may be affected by this should please contact HMRC as soon as possible. Equally, we must recognise that HMRC’s workforce may well be affected by the outbreak. Where appropriate, HMRC has made it clear that it will take steps to support anyone who has been disadvantaged by delays at its end as a result of covid-19. As the House will know, HMRC has already established a helpline to support any businesses and individuals affected. The hon. Member for Bootle (Peter Dowd) raised that issue, and I can confirm the helpline has now been in place for some time and has an expert and supportive staff behind it.
As this debate has made clear, the loan charge, and with it the wider issue of using disguised remuneration schemes to avoid tax, has been the subject of public concern and considerable controversy. Let us be clear that tax is never popular, and my colleagues and I recognise the strength of feeling and sympathise with those who may be subject to the charge. Today’s motion reflects some of the arguments and concerns expressed by colleagues that the loan charge is retrospective and unjust and that the law was not settled, it is claimed, until 2017. If I may, I will deal with each of those charges in turn.
First, however, we need to be clear what we are talking about. Disguised remuneration is a term of art—it is a fancy term—but the House should be under no illusion as to what it amounts to. Such schemes are a form of contrived tax avoidance in which people are paid in the form of a loan with no interest and no intention or requirement to pay the loan back.
Jesse Norman
I thank my right hon. Friend for the question. All he needs to do is attend to the detail of the Morse report, in which Sir Amyas Morse goes through the efforts made at that time, before and after 2010, in some detail. That is the basis for the judgment that he reaches about the appropriate relief.
Chris Stephens
The Morse review also suggests that the main people responsible were the creators of such schemes, who do not seem to be getting chased up to the same extent as those who appear to be the victims of the schemes.
Jesse Norman
I take it that the hon Gentleman rightly refers to the enablers and promoters of such schemes. As he knows, I take that extremely seriously, and I have insisted on that point ever since I became Financial Secretary. I will say more about that shortly.
I return to the point that such schemes were contrived tax avoidance schemes that were typically run through an offshore vehicle. A person would receive a monthly amount of pay, often deliberately set at or around the level of the personal allowance to maximise the tax avoided, and above the national insurance lower earnings limit, so as to qualify the person concerned for the national insurance contributions required to receive a state pension. Of course, that did not reflect the person in question’s true earnings because, alongside that payment, they would receive a further top-up payment described as a loan. In many cases, the top-up payment far exceeded—often by a large multiple—the salary element declared for tax purposes.
Those facts are not genuinely in doubt, and all Members who have taken part in the debate have rightly condemned tax avoidance, but I put them on the record again because they highlight how contrived that form of tax avoidance typically was. They also go to the root of the problem.
My right hon. Friend the Member for Haltemprice and Howden raised the issue of thesauruses and dictionary definitions. Let me remind him of the difference between a dictionary definition and a thesaurus. A thesaurus gives an alternate word of supposedly the same meaning. A dictionary definition tries to explain exactly what it is that is being talked about.
The dictionary definition of a real loan is,
“an amount of money that is borrowed…and has to be paid back”.
That accords with our natural experience, as hon. Members will discover if they try to take out a business loan from a bank and not pay it back. If they try to take out a mortgage and not pay it back, they will find the same to be true.
Those loans, however, were not designed to be paid back. They were rather different from loans that might be made to employees that then get written off, on which tax is typically chargeable. They were not designed to be paid back. They were employment income in disguise, so they were subject to tax.
Sir Edward Davey
Will the Minister set out which piece of legislation, before the loan charge legislation, saw loans as income?
Jesse Norman
I am not in a position to take the right hon. Gentleman through the legal arguments, and I do not need to, because, as I have said, they have been described in detail by Sir Amyas Morse in his review which, of course, is based, as my remarks would not be, on a detailed interrogation with tax experts on all the specific issues behind it. I do not think we have any sensible reason—no one has in fact offered one—for disagreeing at length or in any detail with his conclusion.
Christian Matheson
The Minister knows that I have all the time in the world for him, but nobody in this House disputes the fact that it was tax avoidance and that loopholes needed to be closed. He is spending his time explaining why they were avoidance schemes, but hon. Members understand that. It is the question of retrospection and unfairness that is exercising us in this debate.
Jesse Norman
I am very grateful to the hon. Gentleman, but if I may say so, I do not think that has been true. I think the conclusion colleagues have been pushing in this debate is that they disapprove thoroughly of tax avoidance, and their view is that this is not tax avoidance in many cases. If they accept that this is tax avoidance and that the issue is merely as to the remedy, that is of course a slightly different position, and one that I am happy to respond to.
I just want to make it clear that this is a form of tax avoidance. It goes to the wider issue as to whether people should have known what it was. The point is that it is tax avoidance, and it costs the Exchequer hundreds of millions of pounds a year. That has two effects: it deprives public services of the money they need to operate; and it forces other taxpayers to pay more to make up the shortfall.
The purpose of the loan charge was to combat this form of abusive tax avoidance. The loan charge was introduced as a new measure in 2017. Following a public campaign last year, we asked Sir Amyas Morse, as has been noted, to conduct a review of whether it was an appropriate policy response to the use of the disguised remuneration scheme. He had full control of the review’s management and recommendations. He took evidence from a very wide range of individuals affected, and he spoke to interest groups, MPs, tax specialists and many other stakeholders.
Again, the facts are not in doubt. Sir Amyas Morse, as has been recognised by colleagues today, is an individual of huge experience and great independence of mind, and he is widely respected across the House. He was independent in his review, and he was given wide scope in expert support. He produced a thorough and exacting piece of work—a 76-page, 30,000-word report—that drew on over 700 individual testimonies and impact statements, and which painstakingly worked through the issues before recommending notable changes to the policy, including substantial carve-outs as to who was affected. Sir Amyas was clinical and at times unsparing in his criticisms, including of Her Majesty’s Revenue and Customs and, be it said, of the Loan Charge Action Group. All but one of these recommendations were accepted by the Government.
Among those recommendations were two to which I want to draw the House’s particular attention. The first is Sir Amyas’s insistence, as we have heard across the House today, on the need for the Government to go further in going after and bringing to justice people who enable or promote tax avoidance schemes. I am therefore delighted that, as part of the Budget documentation we have produced today, we have published a policy document on “Tackling promoters of mass-marketed tax avoidance schemes”, and I draw the attention of all colleagues to it. It is a sober and thorough piece of work that looks at lots of different approaches as part of an integrated strategy.
The other thing that Sir Amyas pointed to—again, I think rightly, but also picking up on a widely anticipated and understood gap—is the importance of raising standards in the tax advice market. Again, I am pleased to say that, as part of the Budget documentation, we have published a call for evidence on this very topic, “Raising standards in the tax advice market”. I encourage all colleagues and their constituents to contribute to that approach.
Ruth Cadbury
I thank the right hon. Member for the points he is making about advice and information. However, I again come back to the fact that the low-paid and the averagely-paid—generally public sector workers—are still being sold these schemes. They cannot be paid through a personal services company, but they need to work freelance and locum, and this is still happening to them. If the Government see these schemes as contrived, why are they not doing more to stop the mass marketing of them, such as by making the promoters personally liable for defeated schemes and similar?
Jesse Norman
I have in my hand a detailed document designed to address this very issue. It goes through a whole range of different approaches and integrates them into a strategy. I would be delighted to have any input that she would like to make about other ways in which that can be improved and developed. We work on the basis of the law as it presently stands, and which we have inherited. It is itself the result of previous Parliaments, including of course the parliamentary consideration of the loan charge. We have to work with the hand we have got, and improve it as fast and as comprehensively as we can.
I will now address the motion directly and then, in the limited time I have, turn to the comments that have been made. Is the loan charge retrospective? Again, I think it is clear that it is not. It was introduced as a new measure in 2017. It taxes a loan outstanding at a future date. It does not change any law previously on the statute book.
It has been asked why the loan charge was introduced. In the words of Sir Amyas Morse, it
“offers an expedited means of collecting tax that is due”.
Is the loan charge unjust? Again, I would suggest not. If one asks the average man or woman in this country, I think they would say, “Everyone should pay their fair share of taxes. People are responsible for their own tax affairs. Real loans get repaid; if someone offered you a loan for which no repayment, no tax and no interest was due, it would probably be too good to be true.” And so it is.
The numbers seem to bear that out. More than 99.8% of the tax-paying population have never used a scheme. Even among the freelance population, the take-up has been only 2.5%. It is notable that Sir Amyas Morse was clear that he supported the essential purpose of the loan charge and that it should remain in force.
We have heard a lot about how the law was not settled in 2017. Again, as I said, I can do no better than refer colleagues to section A of the Morse review, which carefully reconstructs the history of the past 20 years of disguised remuneration.
Let me quickly turn to the many excellent contributions that have been made. I will start with the excellent contribution made as a point of order by my right hon. Friend the Member for New Forest West (Sir Desmond Swayne), who pointed out the excellence of my book on Adam Smith—I thank him for that, although I defer to the hon. Member for Kirkcaldy and Cowdenbeath (Neale Hanvey), as Kirkcaldy was, of course, Smith’s home town. My right hon. Friend the Member for New Forest West will recall—he taught economics so he must know about these things—that Smith not only set out the ideals of a well-functioning tax system, which we all aspire to achieve, but was, for the last 12 years of his life, a practising commissioner of customs, attempting to wrestle with an ever-evolving customs market and seeking to extract duty and tax due, and rightly so.
I would like to touch on the statesmanlike comments of the hon. Member for Bootle, the shadow Chief Secretary, which perhaps reflected his imminent expectation of taking my seat on this side of the aisle. He recognised that what people do not pay in tax due, someone else must. He is right about that. He noticed that if it looks too good to be true, it probably is. He is right to focus, as others have, on the enablers and promoters.
Jesse Norman
I have half a minute left. The right hon. Gentleman has only just arrived, so it is a little impertinent to raise a question at this point.
It is important that we focus on the centrality of the claim. Sir Amyas Morse has looked at it, and he has attempted to find a Jupiterian way through complicated tax issues and to deal, with equity, with the different interests and parties involved. I think he has succeeded, which is why the Government, comprehensively, with one exception, have accepted his conclusions.
Mr David Davis
These occasions often show the House at its best, and that is certainly true today.
I start by paying tribute to the Loan Charge Action Group, the all-party group—particularly its chairman—and all who have contributed in the debate, which has been excellent, albeit slightly one way in terms of its emphasis. Why is that? Because this is a matter of justice, not technicalities. It is a story of unclear law not very competently clarified in 2011 and then rewritten in 2017. It is a story of HMRC allowing the real villains—the employers and advisers who forced people into this position—to carry on getting away with that, and of HMRC failing to intervene during that period to stop them.
I am afraid the Morse review is wrong. That was brilliantly exposed by the chairman of the all-party group. There is, in truth, only one answer, but before I come to it, I have 40 seconds, so I will say one other thing to those on the Treasury Bench and the Opposition Front Bench. All of us in this House believe in fair taxation. We all believe that we should pay our dues. When you are doing deals with Vodafone and Google, where they pay from 10% down to 4%, do not turn round to an ordinary locum nurse and say, “It’s too good to be true. You should have known.”
Mr Davis
No, I will not. I only have seconds.
There is only one answer in this debate. I am afraid that Amyas Morse is wrong. The answer is laid out in our motion. HMRC should cease action on all cases before July 2017, and then justice will be done.
Question put and agreed to.
Resolved,
That this House believes that the Loan Charge is an unjust and retrospective tax; notes that the law on the Loan Charge was not settled until 2017; and calls on HMRC to cease action on loans paid before 2017.
Horizon Settlement: Future Governance of Post Office Ltd
(4 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr Kevan Jones (North Durham) (Lab)
I beg to move,
That this House has considered Horizon settlement and future governance of Post Office Ltd.
Innocent people jailed; individuals having their good name and livelihoods taken away from them; the full use of the state and its finances to persecute individuals. Those are all characteristics of a totalitarian or police state. But that is exactly what we have seen in the 21st century in the way the Government and the Post Office have dealt with sub-postmasters and their use of the Horizon system. The Horizon system was the biggest non-military IT project in Europe. It cost over £1 billion to install and affected 18,000 post offices throughout the UK.
Before I go on, I would like to pay tribute to some individuals who I have been working long and hard with on this campaign. The first is the hon. Member for North West Leicestershire (Andrew Bridgen), who cannot be here today because, unfortunately, a family member is ill and he has had to self-isolate. He has been with me from the start in trying to get justice for sub-postmasters, and I will refer to some of his work later. He would like to have been here and sends his apologies; that he is not here does not mean that he is not interested in the outcome. I also thank James Arbuthnot, the former Member for North East Hampshire, who, despite being moved to God’s waiting room further along the corridor, has still consistently pressed the case for justice for sub-postmasters. I pay tribute to the work that he has done in the past and is doing now.
I want to mention two other individuals. Alan Bates is the lead claimant in the class action. Alan has been a stalwart and stuck by his principles—knowing, as he said, that “I am right and I am going to make sure we get the truth out.” The other person is someone who has very helpfully shone a spotlight on the issue, and has spent many hours sitting through long court cases: Nick Wallis is a journalist who has kept this story in the public domain. Alan and Nick both deserve credit for their continued actions now and their work in the past.
I first came to be involved in the issue when a constituent came to see me in my surgery. That constituent was Tom Brown. Tom, like many other thousands of sub-postmasters, was a hard-working and well-respected individual. He had won awards from the Post Office for fighting off an armed robber in his post office, but because of the introduction of the Horizon system, he was accused of stealing £84,000 from the Post Office. Even though he said and demonstrated that that was not the case, the Post Office took him to court, and he went through the agony of being publicly shamed in his local community—we must remember that a lot of these individuals are the stalwarts of their local communities.
Tom went to Newcastle Crown court, and on the day of the trial the Post Office withdrew the case, but the damage had already been done. His good name had been ruined, and he had lost—because he had had to go bankrupt—in excess of nearly half a million pounds in the form of his business, the bungalow that he had bought for his retirement and some investment properties. He now lives with his son in social housing in South Stanley. The man who should have had a nice retirement, and who was well respected in his community, has been completely ruined and is destitute. Despite that—he came to see me last week—he is an individual who still has integrity, because he has always insisted that he is innocent of what he was accused of, and he has not been alone. Despite that—he came to see me last week— he is an individual who still has integrity, because he has always insisted that he is innocent of what he was accused of, and he has not been alone. The estimate from the class action that has been taken is 555, and there are many others, some unfortunately who have died since the case was taken forward.
The scandal of this—what makes me so angry and why I have persistently hung on to the campaign—is that the Post Office knew all along that the Horizon system was flawed.
Kevin Hollinrake (Thirsk and Malton) (Con)
I congratulate the right hon. Gentleman on securing this important debate. Is not the other scandal in this that the courts time and again failed the victims? In the prosecutions that were taken forward by the Post Office, the courts found in favour of the Post Office, despite it being unable to properly evidence its case. It is absolutely wrong. We must stand up for David versus Goliath in our courts.
Mr Jones
I will come back to that, which is something that I think my hon. Friend the Member for Kingston upon Hull East (Karl Turner) will refer to in his contribution.
The board minutes from 1999 show that the Post Office knew there were bugs in the system and software problems. It denied all the way through that, for example, the amounts that sub-postmasters inputted could be changed. That was just not true. It could be remotely done, and the hon. Member for North West Leicestershire and his constituent Mr Rudkin, who visited the headquarters where the data was being stored, proved that. In classic style, when he raised that the Post Office denied that he had ever visited the data centre in the first place, until he proved that he had. It was just one cover-up after another. The denial culture in the Post Office was described by Judge Fraser, in what I thought was a very good his judgment, as
“the 21st century equivalent of maintaining that the earth is flat”,
because the evidence was there all the way through. There is no way that anyone who took an objective look at the system, in terms of the Post Office or Fujitsu, the contractor, could argue that it was perfect.
Duncan Baker (North Norfolk) (Con)
It has also come to light that the people who were fixing the system from behind the scenes, as the right hon. Gentleman mentioned, and who could go in and balance the tills as it were, were incentivised and paid to be speedy and quickly fix the issues, which made a lot of these cases even worse, so that balances that were already poor got even worse.
Mr Jones
It was even worse than that: for many years the Post Office denied that that could ever be done. It was only in 2011, after campaigning by me and others, that the Post Office had the forensic accountants Second Sight take a look, and it discovered exactly what the hon. Gentleman has just outlined. But what does the Post Office do? It set up a mediation service, but still denied that there was any problem, even though the evidence was there.
As for the operator, Fujitsu, it knew that there were glitches. Indeed, I have to say that it is as guilty of the cover-up as the Post Office. I cannot comment on the judgment—I think the judge has possibly referred the case to the Crown Prosecution Service to get its involvement, so I do not really want to go into the detail—but Fujitsu has a lot to answer for.
John Spellar (Warley) (Lab)
My right hon. Friend is outlining a litany of maladministration at the very least. Have any individuals at management level in either at Post Office Ltd or Fujitsu ever been held accountable for this?
Mr Jones
I shall come to that, which is a very good point. The complete opposite: most have been promoted or, in one case, appointed as a Government adviser when she left the Post Office.
That denial then led the postmasters to get the group action together, with 555 taking the Post Office to court. The Post Office was still denying that there was a problem when it went into court; indeed, its consistent approach has been to deny any type of liability.
Let me turn to the role of the Post Office and that of Government. The Post Office is an arm’s length body from Government, but the sole shareholder is the Government. They have a shareholder representative on the board. Despite that, millions of pounds of public money are spent every year. In fact, it is a nationalised company, whether we like it or not.
But we are unable, as parliamentarians, to scrutinise the Post Office. For example, in spite of what it knew, it is estimated that the Post Office spent between £100 million and £120 million defending the indefensible in court. That was basically designed to whittle down the case, so that the other side ran out of money. Trying to scrutinise the Post Office and get it to account for that is virtually impossible. When I have asked parliamentary questions, they are referred to the Post Office. I will come on to the role of Ministers, but I am sorry that the right hon. Member for Kingston and Surbiton (Sir Edward Davey) is no longer in his place, because I would have liked him to answer for his role—or lack of role—when he was the Minister.
The Post Office falls somewhere between a private company and a public company, but then there are the individuals involved, as my right hon. Friend the Member for Warley (John Spellar) said. Paula Vennells was the chief executive of the Post Office. She left last year. Obviously, as a board member she knew what was going on, including the strategy in the court case and the bugs in the system. What happened? She got a CBE in the new year’s honours list for services to the Post Office. That is just rubbing salt into the wounds of these innocent people. There is a case for her having that honour removed, and I would like to know how she got it in the first place when the court case is ongoing. Added to that, she is now chair of Imperial College Healthcare NHS Trust. Again, I would like to know why and what due diligence was done on her as an individual.
Lucy Allan (Telford) (Con)
I congratulate the right hon. Gentleman on his excellent speech and his stoical determination in trying to get to the bottom of this. Is he also aware that the head of Fujitsu UK is now working in the Cabinet Office?
Mr Jones
I do not know whether the hon. Lady has read my speech, but I am just coming on to the Cabinet Office, because lo and behold, guess where Paula Vennells also ended up? She was a non-executive member of the Cabinet Office. I am told that she was removed from that post yesterday; I do not know whether it was because of this debate. I welcome that, but why is someone who has overseen this absolute scandal still allowed to hold public positions? Worse than that, she is a priest. I respect those who have religious faith, and she does, but the way that she has treated these people cannot be described as very Christian—she certainly would not pass the good Samaritan test, given the way she has ignored their pleas. I hope she thinks about people like Tom, who have lost their livelihoods and are now living in social housing because of her actions. It angers me that these individuals have gone scot-free, and they need to be answerable for their actions.
John Spellar
Maybe she fulfils the role of the Pharisee in that parable. Does this not also speak to a deeper problem in our society, where relentlessly, time after time, the great and the good look after each other and hand out these positions to each other, irrespective of whether they have been successful or a massive failure? We see that particularly in the health service, where people move from job to job, taking payments each time they go and leaving catastrophic failures. Is this not a deeper failure in the system?
Mr Jones
It is, but how could somebody be given a CBE when this scandal was out there? How could somebody be appointed to the non-executive board of the Cabinet Office and a healthcare trust, given what is coming out of this court case? I find that remarkable.
Then there is the role of Government. When the right hon. Member for Kingston and Surbiton was the Minister, he said that the Post Office
“continues to express full confidence in the integrity and robustness of the Horizon system and also categorically states that there is no remote access to the system or to individual branch terminals which would allow accounting records to be manipulated in any way.”
That is despite a board minute of 2009 which said that remote access was possible. What his role in it was I do not know, but he clearly did not ask many searching questions of the Post Office.
I turn to how we scrutinise the Post Office. I have tabled numerous written parliamentary questions, but because the Post Office is an arm’s length body, the Department for Business, Energy and Industrial Strategy shift them over to the Post Office—it is at arm’s length, and therefore it is nothing to do with the Department. There is a question here about how we can scrutinise the Post Office. This week, I asked a question about what the complex case review team in the Post Office is. My able assistant rang BEIS and asked, “What is it?” BEIS did not even know about it. The parliamentary question has now been given to the Ministry of Justice, but it does not know what that team is. I know that last week two cases were settled out of court, each for £300,000. This is public money we are talking about here, and we need full scrutiny. I would love to see whether the Minister can shed some light on what this organisation actually is.
Then we come to the role of Ministers. I have already mentioned the right hon. Member for Kingston and Surbiton, but Jo Swinson, Claire Perry and the Minister’s immediate predecessor the hon. Member for Rochester and Strood (Kelly Tolhurst) were all involved. They all completely believed what they were being told by the Post Office, never asked any questions about how public money was being spent and allowed the Post Office to continue what it has been doing. The Government cannot say that they never knew about this, because when the new Government came to power in 2010, myself, James Arbuthnot and the hon. Member for North West Leicestershire went to see Oliver Letwin, then a Cabinet Office Minister, to put our case to him. He had sympathy for it, because he had a similar case in his constituency. What happened to that? Nothing happened at all. Clearly there is an issue that the Government cannot hide from it.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
My right hon. Friend is making an excellent case. I want to raise with him this issue about MPs not being able to find out what happened. In the Hillsborough inquiry, the Bishop of Liverpool talked about
“The patronising disposition of unaccountable power”.
This is a classic case of exactly that.
I also want to put on the record how grateful my constituent Janet Skinner is that MPs such as my right hon. Friend and others have pursued this matter for many years to try to get justice for the people involved.
Mr David Jones (Clwyd West) (Con)
The right hon. Gentleman mentioned the issue of Ministers. Of course the Post Office has a non-executive director appointed by the Government. One must assume that that non-executive director is reporting to Ministers. Would that not be an interesting topic for the inquiry?
Mr Jones
Yes, and I was going come on to that, because I would love to know who those non-executive directors have been over the years and what they said to Ministers. If I had been the Minister, I would have had that person in and scrutinised what was going on, as I am sure the right hon. Gentleman would. That would certainly have applied in the past few months, given the hundreds of millions of pounds that have been spent defending the indefensible.
In December, the Post Office agreed a settlement worth £57 million. Unfortunately, most of that has been swallowed up in the fees and the after-the-event insurance that the litigants had to afford. I do not criticise the lawyers—the people who funded this—because without them we would not have got justice, but that leaves about £15,000 for each of the successful people in the class action. We must recall that my constituent has lost more than half a million pounds, and the Post Office is settling cases outside this settlement for £300,000. What has to happen now is that a scheme has to be set up to compensate individuals properly. We must remember that £15 million of those costs were legal costs for pursuing the case, and £4 million of that is VAT, which will go straight back to the Government. Over the time that Paula Vennells was at the Post Office, she earned nearly £5 million, which just shows how the individuals who have been affected are not having happy retirements and peace of mind, but have been put through this system. The issue is clear to me: the figures that are being paid out now privately need a scheme.
I wish to make a couple of further points before I finish. The first is that the National Federation of SubPostmasters needs winding up now. It is not independent, nobody joins it—sub-postmasters are auto-enrolled. It is basically an arm of the Post Office and is paid for by the Post Office. Surely if it is going to be an independent voice for sub-postmasters, it should be that.
If anyone saw the Business, Energy and Industrial Strategy Committee hearing last week, they will have seen the chief executive, who could not answer on how many of his members had been affected by Horizon or what his organisation had done about it. I will tell the House exactly what it did: nothing. In Tom Brown’s case it just said that the Post Office must be right. The organisation is a sham and it needs to be wound up now. We need an independent organisation to represent sub-postmasters—including through the recognition of the Communication Workers Union, which some people are members of—that can actually be an independent voice for sub-postmasters.
The other thing that I, the hon. Member for North West Leicestershire and James Arbuthnot did was to take some cases to the Criminal Cases Review Commission, because there are people who have been found guilty and in some cases jailed unfairly. I pay tribute to that body, which took the issue seriously and took on a number of cases. It has stayed those cases—quite rightly, in my opinion—until the outcome of the civil litigation. It is important that those cases are now moved on and considered, because there are miscarriages of justice in some of those cases that need to be put right very quickly.
The right of the Post Office to take forward its own prosecutions needs to be removed. This issue goes back many centuries in the Post Office’s history. When Tom Brown asked whether he could get the police or the Crown Prosecution Service involved in looking at the evidence against him, he was told no. Likewise, it was the same for everyone else. Removing that right is something that the Government could do straight away, because there is no adequate oversight of how cases are being prosecuted. In Judge Fraser’s summing up, he described the contract and the way in which the Post Office acted as
“capricious or arbitrary ways which would not be unfamiliar to a mid-Victorian factory-owner”,
and said that the Post Office appears to
“conduct itself as though it is answerable only to itself.”
That is the case: it was answerable only to itself, with little or no insight in terms of oversight from Government.
Let me say what needs to be put right now. I have already mentioned that compensation needs to be put in place. We now need a full independent inquiry, and in a response in Prime Minister’s questions on 26 February, the Prime Minister indicated that that might be the case, calling the issue a “scandal”. In response to Lord Arbuthnot in the other place on 5 March, Lord Callanan said that the issue would be under consideration. We need as a matter of urgency an inquiry to cover not just what has gone on but how we can improve the situation for the future, and it has to be independent of Government. The Business, Energy and Industrial Strategy Committee is looking into the matter, and I give credit to it for doing that, but we need some recommendations about what went on in the past. I am sorry, but as my right hon. Friend the Member for Warley said, we need to expose who did what. I have to say, if in some cases what I would argue was criminal activity took place, people have to be prosecuted. Given their involvement, they certainly need to be removed from any public bodies on which they currently serve.
The Minister’s predecessors have not been good at looking into this issue. They have not asked the right questions—they have not asked questions of their officials or the Post Office. The Minister now has a chance to put this right. I know that he spoke to Alan Bates yesterday, and I know that he is hiding behind the court case in terms of compensation—his officials are saying that they cannot get any more. I have to say: please do not do that. It is now time for bold action. If we do not take action, this injustice will continue.
Let me finish with this: my constituent Tom Brown should be enjoying a happy, well-funded retirement, but he is not. He is still a proud man, as I said—he is a man who has not lost his dignity—but he is living in social housing with his son, and that is not his fault; it is down to people such as Paula Vennells and the board at the Post Office, and the failure and cover-ups that have been perpetrated by individuals. The Government, who should have stood up for him, have turned a blind eye.
Several hon. Members rose—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. It will be obvious that we have just over an hour left for this debate, which is not long. I hope that we can manage without a time limit, and we will if everyone takes about five to six minutes. That does not mean seven to eight minutes.
Martin Vickers (Cleethorpes) (Con)
I will try to complete my contribution in even less than five or six minutes, Madam Deputy Speaker.
The right hon. Member for North Durham (Mr Jones) has given a comprehensive explanation of the background to this case, and many of us taking part in this debate will be familiar with it. We have met constituents whose lives have been destroyed, which is not too strong a word to use.
I have six constituents who have been affected. They are decent, honest, hard-working individuals—indeed, they are public servants—but their lives have been wrecked. Some have lost their homes, and some now have a criminal conviction. Surely the Post Office will recognise that these people have not become criminals overnight. Why were no questions asked? During my 10 years in the House I have attended numerous debates on the issue and, to be absolutely honest, and as the right hon. Gentleman has said, Ministers have tried to wash their hands of it. They stood back when clear injustices were being ignored.
As Justice for Subpostmasters Alliance has said that, given the tyrannical conduct of the Post Office over the years, it had no alternative but to seek litigation. Scores of postmasters contacted the Post Office to tell it of discrepancies. They were not trying to hide them. Their actions were hardly those of someone deliberately engaging in fraudulent activity.
The judge was scathing in his remarks about the Post Office, and rightly so. The Post Office relied heavily on section 12, clause 12, of its contract with the sub-postmasters. The judge rightly drew attention to that. The clause states:
“The Subpostmaster is responsible for all losses caused through his own negligence, carelessness or error, and also for losses of all kinds caused by his Assistants. Deficiencies due to such losses must be made good without delay.”
Yet the judge found:
“It is not for a Subpostmaster to demonstrate that there was no negligence, carelessness or error on his or her part. It is for the Post Office to demonstrate that there is. It is only if the Post Office can demonstrate that there is a loss which falls within the scope of the clause, that it is entitled to rely upon the clause”.
As has been mentioned, it is staggering that Fujitsu could access a sub-postmaster’s account without his or her knowledge. That left it wide open—though one hopes that this was not the case—to others to interfere with the account entries.
It is perfectly obvious that Horizon is not fit for purpose. The attitude of the Post Office is a scandal and a disgrace. As I have said, successive Ministers have sought to wash their hands of this. Yes, the Post Office is an arm’s length body, but, as has been said, the Government cannot escape their share of responsibility. Circumstances have changed. Anyone who has read the judge’s remarks cannot avoid acknowledging that they have some responsibility. We now have a new Minister in post and he has an opportunity to show some sympathy. As with the previous debate on IR35, this is about correcting an injustice, and the Government, along with the legal process, have an opportunity to achieve that. The Government should act without delay in instituting a full, independent inquiry and compensate in full those who have suffered.
Financial compensation, though, can never wholly recompense those whose lives have been utterly and totally destroyed. I and, I am sure, other Members, have had people in our constituency surgeries who have been reduced to tears because of how the Post Office has treated them. They have been diligent public servants for many years, and it is intolerable that they have ended up in this situation. I urge the Minister to take action on this as quickly as possible.
Karl Turner (Kingston upon Hull East) (Lab)
I congratulate my right hon. Friend the Member for North Durham (Mr Jones) on securing this debate and on moving the motion. We have had discussions over the years about this case, which is a massive scandal, the likes of which I have not seen before.
Before my election to this House in 2010, I prosecuted and defended in criminal proceedings from my local chambers in Hull and, prior to that, I worked with a firm of criminal solicitors. It was there that I met Janet Skinner, who is a constituent of my hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson). Janet Skinner was prosecuted by the Post Office for dishonesty—theft, fraud and other related offences. I took Janet Skinner’s instructions. It was a very brief encounter, from memory. It was probably a conference that would have lasted no more than 20 minutes, but I remember her instructions and, indeed, she has reminded me of them since. She could not understand why she was being accused of dishonesty. When she explained the situation to me, it was clear that what she had committed, if anything, was the offence of false accounting. Why? Because when her books did not balance, she would ring the helpline and it would tell her—and other sub-postmasters and mistresses—off the record, “You just need to make the books balance.” Effectively, they were told to make up numbers. The helpline said, “Put the information in, then you can close the system down for the night and trade the next day.” That was utterly disgusting.
My analogy is that it is like being trapped in a burning building. You ring the emergency services, you explain the situation and you are advised to smash a window to escape the building. Once you have, you are eventually prosecuted for criminal damage. That is the scenario. It is not a perfect analogy, certainly not for a criminal lawyer, because there is an inbuilt defence in criminal damage of reasonable excuse.
Janet Skinner was of good character, with no previous convictions. She reminded me recently that she had never even had so much as a parking ticket to her name. But if she had sat down with a probation officer for pre-sentence report, it was clear it would not be a good one. Why? Because she would have said, “I didn’t do anything.” When she was asked if she was sorry, she would have said, “No, I am not sorry because I do not think I have done anything wrong.” I did not represent her at the sentencing hearing as it happens, but when she was sentenced, the judge would have questioned whether she was likely to commit further offences because she had admitted no culpability whatever and she was not sorry. She was not sorry because she had done nothing wrong. We now know that she should not have been investigated, she should not have been interviewed and she certainly should not have been prosecuted. We now know that she should not have pleaded guilty to false accounting and that she certainly should not have gone to prison for nine months.
Since I have been involved in representing victims of this scandal, I have been contacted by other sub-postmasters, and a few days ago I received some startling documents. In 2006, a sub-postmaster was prosecuted. I have documents showing discussions between lawyers within the Post Office conceding that there was no theft, no dishonesty, no fraud and no false accounting in this case, yet she was prosecuted. It is utterly disgusting. When this person found out that these documents existed, because they had been leaked to her, she asked the Post Office whether they would produce the documents to the Criminal Cases Review Commission and she was met with aggression the likes of which I have never seen. She was told that these documents were privileged and that if they were leaked she could be in serious trouble. There was bullying, aggression, and constant lies from the very beginning—lie after lie after lie.
I have read Mr Justice Fraser’s judgment—it is a pleasure to read—and to someone reading the judgment it is clear that lies were constantly told. I am prepared to accept that Ministers and Government officials were misled from the very top of the Post Office and Fujitsu. What do we do now to put matters right?
Duncan Baker (North Norfolk) (Con)
Does this not underline the simple fact in all of this, that the Post Office’s only consideration in all of this was to protect itself at the cost of the total injustice that so many people faced?
Karl Turner
I am grateful to the hon. Gentleman. I have described this as the most grotesque version of predatory capitalism I have ever seen. Why? Because £1 billion was invested and senior officials in the Post Office and Fujitsu did everything they possibly could to protect themselves. They knew. Let us be absolutely clear about that. They knew that there were victims who might go to prison—or who had already gone, at that point. It is utterly disgusting.
Lucy Allan
I, too, have a constituent in exactly the situation the hon. Gentleman has described, who was 18 years old and was sent to Holloway for six months, accused of theft and failing to apologise to the grannies she was supposed to have stolen from. She has not had her name cleared. She has been waiting five years for the Criminal Cases Review Commission to do that.
Karl Turner
The hon. Lady is absolutely right. These sub-postmasters were respected in the community. The Post Office is a respected organisation that we should all be incredibly proud of, but that was part of the problem. The Post Office was believed. The lies that Ministers, officials and everyone else were told along the line were believed as well. That is why only a judge-led inquiry can possibly sort this out. We need to know who knew what, what they knew, when they knew it and why they acted as they did.
I want to say something briefly about one of those senior people in the Post Office, Paula Vennells. I do not know Paula Vennells but I do know that she apparently earned something in the region of £5 million over a six-year period. I believe wholeheartedly that she would have had a very good inkling of what was going on at the time. This is utterly scandalous and a judge will be the person who can get to the bottom of it.
Mr David Jones (Clwyd West) (Con)
I, too, congratulate the right hon. Member for North Durham (Mr Jones) and my hon. Friend the Member for North West Leicestershire (Andrew Bridgen) on securing the debate. I have the privilege of representing Mr Alan Bates, who was the lead claimant in the proceedings that were settled in December. If it had not been for his tenacity and that of others, the consequences would have been that the wrongdoings of the Post Office and Fujitsu would have gone undetected and the reputations of many hundreds of completely decent, innocent people would have been completely destroyed without any hope of being repaired.
It is clear from the judgment delivered last year by Mr Justice Fraser that the Horizon system was, at all relevant times, defective. It is also clear that the Post Office and, by extension, its directors and, by further extension, its Government-appointed directors must have been aware that the system was defective. Notwithstanding that, for over 20 years, the Post Office stubbornly and aggressively continued to assert that the system was fit for purpose. Many innocent sub-postmasters and sub-postmistresses lost their livelihoods, some of them went bankrupt, some of them were prosecuted and, indeed, some of them were sent to prison. It is an absolutely scandalous tale.
It is, indeed, a credit to Mr Nick Read, the new chief executive of the Post Office, that his intervention helped achieve a settlement to the legal dispute last December, but that settlement cannot be the end of the matter. The Government cannot simply regard the settlement as putting the Horizon issue to bed. As other hon. Members have said, after costs are taken into account, the settlement sums for those 500-plus litigants will be paltry. The Government have a duty to further compensate the sub-postmasters who have been so appallingly treated by a Government-owned company.
I will be brief, because I know others wish to speak, but there is a vehicle that could be used to pay that compensation. The Post Office operates a suspense account for unallocated money and, given the history we have heard today, I suggest there is rather a lot of unallocated money in the Post Office.
According to a 2015 report by Second Sight, unreconciled balances for the 2014 financial year were approximately £96 million in respect of Bank of Ireland ATMs and approximately £66 million in respect of Santander. Bank of Ireland and Santander are just two of approximately 170 so-called client accounts operated by the Post Office. The question of how much has been going into the Post Office’s profit and loss account from unreconciled balances would clearly have to be a matter for further inquiry. However, it is surely a source available to repay the costs of the claimants in these court proceedings.
To summarise, the Government owe a significant debt, both financial and moral, to the wronged sub-postmasters as a consequence of the deplorable conduct of those responsible for the direction of the Post Office, including non-executive directors appointed by the Government. Ministers should ensure that the debt is discharged as quickly and as fully as possible. Although it is pleasing to hear assurances from Ministers that they recognise the Post Office needs to do more to strengthen its relationship with sub-postmasters and to regain public trust, it would be even more pleasant to hear they are making arrangements to compensate the claimants as quickly and as fully as possible.
Finally, I fully support the calls for an independent inquiry, which the Government have a moral obligation to deliver.
Bambos Charalambous (Enfield, Southgate) (Lab)
The Post Office Horizon scandal must rank as one of the most shocking and badly handled ever. Its impact on honest, hard-working sub-postmasters has been truly devastating and life changing. Even the compensation won by the sub-postmasters in their class action against the Post Office will do very little to replace the lost years of pain, suffering and social stigma due to being classed as criminals, when all these people set out to do was to earn an honest living.
One of those affected is my constituent Kamran Ashraf, whose wife was a sub-postmaster, and together they ran the business. Right from the beginning, using the Horizon software provided by the Post Office, there were shortfalls. In September 2003, the Post Office carried out an audit of their branch and found a shortfall of £25,000. Following investigation, the Post Office prosecuted Kamran and his wife, but because they had two small children, even though they had done nothing wrong, Kamran decided to plead guilty so that their children would not risk both their parents being incarcerated. In February 2004, he was sentenced to nine months’ imprisonment at Kingston crown court and, to add insult to injury, was fined £25,000.
Kamran and his wife lost their business and their home and had to enter into an individual voluntary arrangement to pay off creditors. Because of his conviction Kamran struggled to find work, and although his conviction is now spent and he has found employment, he still has that stain on his reputation because his conviction has not been overturned.
In August 2015 Kamran happened to chance on the BBC “Panorama” TV programme, which highlighted other cases identical to his, where sub-postmasters were prosecuted and convicted due to shortfalls in their takings following an audit. Dozens of sub-postmasters were affected and came forward and formed an action group called the Justice for Subpostmasters Alliance, or JFSA for short. The JFSA, led by Alan Bates, brought a class action with a total of 557 sub-postmasters which was vigorously fought by the Post Office, and on 11 December 2019 the sub-postmasters were awarded £57.75 million in damages.
My right hon. Friend the Member for North Durham (Mr Jones) is right when he says that the biggest scandal of all was the fact that the Post Office denied that there was any flaw in the system but knew all along there was a problem, while innocent people were sent to prison.
Dr Julian Lewis (New Forest East) (Con)
One other thing the Post Office must have known all along was that there was this huge spike in postmasters and postmistresses being reported and prosecuted, so they did not know that they were not alone in the matter, but the Post Office presumably knew that all this was going on at scale.
Bambos Charalambous
The right hon. Gentleman is absolutely right and makes an excellent point. Evidence about the infallibility of the system would have led to the conviction of these sub-postmasters, and that is why we need to look at how to progress this further. While after the trial the Post Office chairman conceded that it had got things wrong in the past, the fact was that the Post Office fought the action until the bitter end, and that speaks volumes.
Lucy Allan
Does the hon. Gentleman agree that the way the Post Office conducted itself throughout the litigation process was shameful in terms of trying to grind down the claimants, so they would withdraw their claim?
Bambos Charalambous
The hon. Lady is absolutely right. The Post Office seemed to have unlimited funds at its disposal to fight this action, whereas the sub-postmasters had to collectively bring the action together and rely on support from free solicitors to get them through the case. The Post Office is an arm’s length organisation, but there seems to be no accountability for its actions, and in this matter there seems to be no scrutiny, despite it receiving public money for its functions.
Although the civil action may be over, the nightmare continues for my constituent. Kamran is still trying to get his conviction overturned. The Criminal Cases Review Commission board is meant to be meeting next week to discuss what steps it will be taking; I am not sure if that will be going ahead, but I hope it does. He is also still considering further civil action, and he is not alone. After having been failed by the legal system, it seems that justice is now finally being done, but at a very slow pace.
I therefore invite the Minister to do whatever it takes to get justice for the sub-postmasters, and I also join the call for an independent, judge-led public inquiry into this shocking scandal.
Jerome Mayhew (Broadland) (Con)
Scandals come and scandals go, and both as a former barrister and as a new Member of this House, it is all too easy when we see a raft of paperwork coming across our desks to scan through the details and forget that each of these scandals is made up of individual cases—individual human stories—so I beg the indulgence of the House and ask to reprise the story of Siobhan Sayer, a constituent of mine who 14 years ago was a sub-postmistress and had trouble balancing accounts. She did not hide this issue; she highlighted it and asked for help—indeed, she asked for help from the Post Office. Eventually, that help came, in the form of three auditors. They did not assist her in balancing the books. Instead, they suspended her, they accused her of theft, they searched her house, asking her where she had hidden the money, and then they interrogated her to such an extent that it stopped only when she physically collapsed. But it did not end there: they took the further step of prosecuting her, both for theft and for false accounting.
That young lady was pressurised to plead guilty to the lesser charge of false accounting in order to avoid a prison sentence for theft. As a former barrister, I can understand why, in the face of the seemingly impenetrable evidence of a robust system in the form of Horizon, that advice might have been given. Having pleaded guilty, she was sentenced to 10 months’ imprisonment, suspended for two years, and 200 hours of community service. That is terrible. That is a true scandal. But it is worse than that, because she was shamed in her community, she was ostracised by her friends, and her mental and emotional health was hit to such an extent that she was unable to leave her home for two years. That is the consequence of the actions and inactions of the Post Office and its servant, Fujitsu.
Why did that happen? Undoubtedly, it happened because the Post Office did not care to believe in the honesty of its own staff. It refused to believe that the system could be wrong, despite its own evidence mounting up to the contrary.
Mr Kevan Jones
Does the hon. Gentleman agree that it is remarkable that there is a minute showing that the Post Office board knew in 1999 that the system had its faults?
Jerome Mayhew
It is absolutely inexplicable, and it lasted right up to the evidence heard last year by Mr Justice Fraser. As was mentioned, he said that the Post Office acted rather like the flat earth society, refusing to believe even its own facts. But there is a strong suspicion that it went further than a refusal to believe; there was actually a question of dishonesty, particularly in the evidence given by Fujitsu. The learned judge expressed serious concerns about the veracity of that evidence and took the very unusual step of referring it to the Director of Public Prosecutions to consider whether criminal prosecutions should follow.
This matter was discovered only by the brave and tenacious actions of the victims themselves over a 10-year period, faced with unending delaying and cost-increasing tactics by the Post Office.
Matt Rodda (Reading East) (Lab)
The hon. Gentleman is making an excellent speech. Does he agree that sub-postmasters and sub-postmistresses are at the heart of many local communities and not only have the respect of those communities but deserve the respect of the Post Office and people in authority? This whole sorry saga shows a complete and utter lack of respect and trust. It is deeply disappointing and, as he suggests, it is deeply wrong.
Jerome Mayhew
I entirely agree. It was the very fact that postmistresses and postmasters are at the heart of the community that made the devastation of their reputations all the worse when they were unjustly accused by their employer of dishonesty and theft.
I conclude by imploring the Government not to hide behind the corporate veil. Albeit at arm’s length, the Post Office is a part of the Government—it is part of the Department for Business, Energy and Industrial Strategy. It was referred to earlier as an example of unaccountable power, and I fully endorse that statement. It is part of a wider problem with the lack of accountability in quangos throughout our society. That leaves open only one sensible solution: a judge-led inquiry that has the power to investigate who knew what and when, and to give justice to these people and award real compensation.
Duncan Baker (North Norfolk) (Con)
When I spoke in the Westminster Hall debate on 5 March, I said that I had a declaration of interest to make. May I declare that I was once a postmaster? In 2015, I was somewhat of a pin-up for the Post Office when I won postmaster of the year at the retail Oscars. Really, I could not sell a stamp; it is the team who should take all the honour. I resigned as a director of the company that ran those post offices and now have no interests. I also want to make it clear that none of my post offices or staff were affected by the scandal.
However, this is a valid point to make—I wonder whether anyone else in the Chamber can claim to have been a postmaster at any point in their career. I think it gives me a unique insight and ability to comment on this scandal. As I said in the Westminster Hall debate secured by my hon. Friend, the brilliant Member for Telford (Lucy Allan), I will concentrate on the governance issues. I shall make three points.
Not only have I used the Horizon system and had first-hand experience of making up the losses, which is always a worrying moment, but I can empathise utterly with the awful situation of the hundreds of innocent victims. We have heard it before and we will hear it time and again this afternoon: innocent people have lost their life savings and young people—men and women—have been jailed and then struggled to rebuild their lives because of the criminal record. I have constituents in North Norfolk who have gone through such trauma. Their story is every bit as dreadful as the other cases we will hear about.
I question whether the £58 million that has been set aside to recompense the victims will be enough. I think we probably all agree that it will not. After the lawyers take a large portion of that fund, what will be left? That is not right. The Government must intervene, as the main shareholder, to ensure that people are recompensed properly.
The board of Post Office Ltd is, unquestionably, accountable for this fiasco. Action must be taken so that board members are properly dealt with for this injustice. What kind of corporate governance structures failed to allow this to happen? Those who have been jailed and who have criminal records must have them overturned.
I turn to the three governance issues that need to be put right. Together, these issues show the failings in the organisation. My first point is about the total withdrawal of the Crown network. It is an absolute necessity that we still have a backbone of Crown post offices in this country. We have gone from 600 a few years ago to just 100. Why is that relevant? We are talking about systems like Horizon going wrong. If you have a backbone of Crown post offices that work effectively, they are often a test bed for new products and systems. They provide continuity in the network when so many franchised operations come and go depending on the operators’ success.
Let us also remember the staff, as an organisation is only as good as the people who work in it. It is the staff who are the real holders of long-standing deep knowledge, and they should act as the wider custodians of the network. If the Post Office had listened to its staff in the first place when they raised the flag, this perhaps would not have happened. There should be an immediate moratorium on the programme of Crown disposals to ensure that the Post Office’s backbone is preserved.
Secondly, a total decimation of the wider branch network is going on at the moment, and it remains a concern to many people—not just to the people who work in the Post Office, but to many communities that use it—that they and their communities are losing their branches. It is not anecdotal to suggest that the number of permanent sites falls year after year. All the longer-term projections will see them continue to go, despite the Government enforcing the Post Office to not shut its branches.
Let me go back to the contribution of my hon. Friend the Member for Broadland (Jerome Mayhew), the eminent barrister that he is. His Fakenham branch closed just around Christmas time. Replacing a physical branch with a mobile post office is not adequate for that community. I urge the Minister to put some governance in place to make sure that such branches are not lost. I say to him, please step in to try to stop these closures, because these post offices are so vital in our communities.
My final point goes back to the remuneration of our sub-postmasters. It is really quite clear that the commissions that a sub-postmaster earns from running a post office are so low that many of the franchise operations have to have a retail offering as well. In many rural areas where footfall is lower—and it is getting lower all the time—we need to ensure that we preserve those that remain. We want to have a vibrant network, so will the Minister please look into that?
Kevin Hollinrake (Thirsk and Malton) (Con)
It is a pleasure to speak in this important debate, and I am grateful to the right hon. Member for North Durham (Mr Jones) for bringing it forward and for his excellent speech.
One thing that we do well across this House is to stand up for David against Goliath. As many Members know, I have worked quite hard on similar issues in the banking sector, where, again, we see that David and Goliath issue. Members on both sides of the House stand up very well against Goliath on these occasions. I wonder whether our system does the same.
The issues that post offices face and the disgraceful treatment of sub-postmasters and mistresses have been highlighted very well here today. My question is: why have the courts not stood up for these people through these past 10 or 20 years? These matters have been before the court hundreds of times, yet the court has not found in favour of people who have been demonstrably innocent of the charges. That is not just what I think, but what Paul Marshall, a barrister at Cornerstone Chambers, says. He looked at these issues across the banking sector and in these cases and he finds that the courts are structurally biased in favour of large, trusted brands. That cannot be right. I was always brought up to believe that everybody could get justice. The rules of court require the courts to maintain a fair and level playing field, yet, as we know, the courts are open to all, just like the Ritz hotel. There is a structural imbalance between a sub-postmaster or mistress when they go to the courts and the phalanx of lawyers provided by the Post Office. The courts are used to suppress the truth, and that cannot be right. There have been 110 prosecutions. Back in 2007, in the case of the Post Office Ltd v. Lee Castleton, Judge Havery found that there was irrefutable evidence against Mr Castleton, despite the fact that there was no evidence. That was just his statement; there was no evidence that the Post Office was in the right.
We know that the Post Office knew that this was going on after the Second Sight report. The prosecutions stopped at one point, but of course they then carried on. We have seen similar issues at Lloyds bank, which knew back in 2007 that this stuff was going on, yet did nothing and carried on as if it was in the right until the case came to court 10 years later. It tried to discredit a whistleblower and the victims. The same happened at Royal Bank of Scotland.
We must ask questions of the system: of the Post Office, of course, about who knew what and when—I support the calls for a public inquiry and proper compensation—and of the solicitors who acted for the Post Office. There are some ethical issues here. The Solicitors Regulation Authority should look into the actions of Womble Bond Dickinson, which represented the Post Office in 2007. It knew about the Second Sight report yet continued to support the Post Office’s case. The same happened at Lloyds with Herbert Smith Freehills.
We must examine the system. The justice system—the judiciary, the Justice Secretary, the Civil Procedure Rule Committee—must learn lessons from this. Why should it take 12 years and £40 million in legal fees to get justice? That cannot be right. We must have a justice system that works for all.
David Linden (Glasgow East) (SNP)
As others have done, I thank the right hon. Member for North Durham (Mr Jones) for securing the debate. I will try to cut my speech to allow others to get in.
As we have heard, ordinary men and women throughout the UK have had their lives ruined by the scandal. Two constituents have had their lives turned upside down. I will say more about the trauma and anguish that they have been through later.
Although the court case has concluded, it is not enough to bring closure for those families, many of whom have endured 10 years of trauma. The Justice for Subpostmasters Alliance was formed in 2009, but it took until last December to get the settlement agreed. Any struggle for justice is difficult, but being put through a decade of hardship and anguish is more than many of us would have the fortitude to endure.
For my constituent Jacqueline El Kasaby and her husband, it was too much. They were not part of the group legal action because they had already settled through the earlier mediation. Their story is a little different from that of those who went on to pursue a legal remedy in that they just could not continue the fight. Who can blame them? Facing a bill of £36,000, the El Kasabys agreed to settle by paying the Post Office £10,000. The El Kasabys knew that they had done nothing wrong, but they had no fight left in them, and, thinking they had no redress, just wanted to start to close that chapter in their lives. They scraped the money together and continue to pay the mental, emotional and financial cost to this day.
What of those, like the El Kasabys, who settled through mediation and were forced to pay bills that were not theirs to settle? Given what we know now about the culpability of the Post Office and Fujitsu in the scandal, what action will the Government take urgently to ensure justice for them? Speaking to my office last week, Jacqueline outlined the position she now faces due to the covid-19 outbreak. She has been dealt a double whammy in that she is losing income and struggling to pay a previous debt accrued as a result of the Horizon faults. As a matter of urgency, will the Government step in and ask the Post Office to pay back those settlement amounts immediately and to reopen the remediation cases?
Another constituent, Mrs Elizabeth Barnes, was part of the group legal action. She will receive a pay-out, but does not know exactly how much. As other hon. Members have said, a lot of it will be subsumed in legal fees. One thing is for sure: she will not be paid anywhere near what she deserves. Once the costs associated with funding the action are subtracted, the claimants will receive much less than they should get. Mrs Barnes has one ask of the Government: to back her and the others by paying the funding so that she and 554 others get what they deserve. The Government must take some responsibility for cleaning up the mess.
Serious questions remain about the mess: about oversight and what was known by whom about the ham-fisted attempts to try to cover it up. Post Office Ltd may be an arm’s length organisation, but a Government shareholder sat on that board throughout the period when the scandal occurred. Why was the saga allowed to drag on for so long when it was apparent that the problems were so widespread? Why was £100 million of public money spent defending the case when it was clear that the Post Office had no business continuing to prosecute innocent people? Why are the Government not taking more action to put things right, given all the injustices that have been laid bare, particularly this afternoon?
All too often, the Government cite post offices as ideal replacements for bank branches that have closed, but Post Office Ltd struggles desperately to get sub-postmasters to take on branches. Tollcross post office in my constituency was closed for almost two years before finally reopening in December. Who can be surprised that that challenge exists when sub-postmasters have been treated as horrifically as the El Kasabys and Mrs Barnes?
One other point I wish to make is the need for a public inquiry. In response to the hon. Member for Jarrow (Kate Osborne), the Prime Minister seemingly gave a commitment at PMQs to get to the bottom of this matter through such an inquiry, and I would expect further details to be divulged by the Government today.
I will conclude, but I want to comment that, given the sheer scale of this scandal, it is surprising that there has not been more media coverage. An honourable mention should be given to the freelance journalist Nick Wallis, who has been following the case since 2010. The independent online technology outlet, The Register, also deserves commendation for continuing to cover this story. With the campaign group up against such massively well-funded organisations, this really has been a David and Goliath story, as the hon. Member for Thirsk and Malton (Kevin Hollinrake) mentioned. It is right to put on record our appreciation of those who have ensured that this story and the plight of those involved have been reported. I very much look forward to the Minister’s response, and I hope he takes this opportunity to start putting things right.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I congratulate my right hon. Friend the Member for North Durham (Mr Jones) and the hon. Member for North West Leicestershire (Andrew Bridgen) on securing this incredibly important debate. I particularly commend my right hon. Friend for his work on this issue over many years and for his excellent opening remarks. Like him, I pay tribute to the hundreds of sub-postmasters who have faced unimaginable hardship as a result of this scandal, and I want to celebrate the work of Alan Bates, who has helped to secure some justice for 557 sub-postmasters.
As we have heard from Members on both sides of the House, a truly shocking number of individuals and families have had their lives impacted by the shameful way that Post Office Ltd has conducted itself throughout this process. Hundreds of sub-postmasters have been accused of fraud and forced to pay back thousands of pounds. They have faced bankruptcy and conviction, and financial compensation alone will never repair the damage caused.
Speaking as a former software engineer myself, I am upset and truly disappointed at the way in which technology has been used as an instrument of torture. An IT deployment of this kind—one of the most expensive in the history of the United Kingdom—should have had users and people at its heart. It should not have been turned into a living nightmare—a living nightmare that continues for many sub-postmasters to this day.
Many MPs have told the stories of sub-postmasters from their constituencies. In Newcastle upon Tyne Central, sub-postmasters have suffered mental health problems brought about by this scandal. One young woman affected was still a teenager when convicted of fraud, and she has faced unemployment and financial ruin. As we have heard from other right hon. and hon. Members, she has been ostracised from her community and shunned by friends and neighbours. Sadly, her case is far from unique, and I want to pay tribute to all those who have suffered in this way.
In December, after a long trial in which the Post Office’s heavy-handed actions against its own staff came to light, it agreed to pay a £58 million settlement to the 557 sub-postmasters who had brought action against it. In his verdict, Mr Justice Fraser stated that the Post Office treated its sub-postmasters in
“capricious or arbitrary ways which would not be unfamiliar to a mid-Victorian factory-owner.”
He also described its long-standing defence of the Horizon system as
“the 21st century equivalent of maintaining the earth is flat.”
We appear to have a Dickensian, flat earth society running our precious network of local post offices.
On the Criminal Cases Review Commission’s review of the convictions of those affected by the Horizon scandal, such an extraordinary set of circumstances requires a bespoke response. The Government have parroted the Post Office’s line that those wrongly convicted must each bring their own individual appeal forward. However, it is simply not right to require those already in financial ruin to incur yet more costs in the fight to clear their name. Will the Government therefore consider giving the CCRC the mechanism it needs to assess the case for a group expungement of those convicted due to faults with the Horizon system?
This is a Government-owned company that has been found to have been at fault. It is therefore of the utmost importance that the Government act to improve the corporate structure of the Post Office to prevent this kind of thing from ever happening again. More should have been done to address the issue before it was allowed to develop into the scandal it is, but all we can do now is ensure that those wrongly convicted get justice and lessons are learned. Unfortunately, the close relationship that the Government have with the architects of Post Office Ltd’s vicious pursuit of sub-postmasters means that they are unable to create an environment that allows the necessary large-scale changes to happen.
I welcome the fact that Paula Vennells, the former chief executive of the Post Office who was so heavily criticised by Justice Fraser, appears no longer to serve on the Cabinet Office board, but why on earth did the Government allow that appointment to be made? Why did they not act sooner to distance themselves from those responsible for impacting the lives of so many?
As we have heard, on 26 February, the Prime Minister, in answer to a question from my hon. Friend the Member for Jarrow (Kate Osborne), appeared to commit to a full public inquiry into the Horizon scandal. When we hear from the Minister, I hope he will be able to provide more detail on the timescale and scope of that inquiry. Again, it is worth emphasising that litigation was brought to address the errors of a Government-owned company. A civil servant sits on the board of the Post Office. Its only shareholder is the Secretary of State for Business, Energy and Industrial Strategy, so more should have been done to address the scandal before it was allowed to fester to this extent. Serious questions need to be answered about the relationship between the company and the Government.
The Government appear to be content to act as the Post Office’s parliamentary organ throughout this process, claiming that the December settlement was the end of the matter. Nothing could be further from the truth for the people who are still fighting for justice, and that is why we need a judge-led independent inquiry to take place as soon as feasibly possible.
I want to say a word about the Communication Workers Union, which identified flaws in the Horizon system back in 2015 and has worked hard to secure the inquiry. It has said that it is happy to work with us to ensure that it is timely and independent. So far, we have not seen any accountability for the lives and reputations that have been ruined. That is why securing this independent inquiry will be such a big victory for sub-postmasters, trade unions and justice. The Government failed to live up to their responsibility and prevent the scandal occurring. I hope the Minister has listened carefully to the excellent contributions from all parts of the House and will use his influence to ensure that justice is delivered for the hundreds of sub-postmasters wronged and to hold those responsible to account.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
First of all, I congratulate the right hon. Member for North Durham (Mr Jones) and my hon. Friend the Member for North West Leicestershire (Andrew Bridgen), who cannot be here today, for securing today’s important debate. I thank all Members for their contributions to this excellent and heartfelt debate.
We know that the Government recognise the role of post offices, and that was articulated by my hon. Friend the Member for North Norfolk (Duncan Baker). It is so important that we make sure that we build on the network. There is no programme of closures—there have actually been 400 new post offices in the past few years, and I want to make sure that we can develop on that, although individual post offices may open or close at various points. I want to make sure that I spend the rest of my time covering as many as possible of the questions that have been raised in this interesting debate.
It is impossible to ignore the impact that the litigation process has had on the affected postmasters and their families. We have heard about Tom Brown, Janet Skinner, Alan Bates, Kamran Ashraf, Siobhan Sayer, Elizabeth Barnes and Jacqueline El Kasaby, among others. As my hon. Friend the Member for Broadland (Jerome Mayhew) said, they are all real people, not just people on a spreadsheet or a list. They are individuals whose families have been affected, so I will not hide and I will not wash my hands of it. It is so important that we get as much done as possible, even if we cannot achieve everything that has been asked.
I am glad that the Post Office has accepted that it got it wrong in the past on the Horizon accounting system and in its dealings with a number of postmasters, and that it has apologised. I am glad that we got a comprehensive resolution to the litigation following several days of respectful, challenging and ultimately successful mediation, although several hon. Members have raised issues about where we go from here.
Beyond the financial settlement, the Post Office committed to directly address past events for affected postmasters, so it will shortly announce a scheme to address the historical shortfalls for postmasters who were not part of the group litigation. That scheme has been designed to offer a fair, fast and transparent means for postmasters’ historical issues to be resolved.
The terms of the settlement put the onus on the Post Office to implement the necessary cultural and organisational changes highlighted by the litigation, which means that the company should foster a genuine commercial partnership with postmasters. Clearly, it has to settle its past relationship with postmasters to look forward and ensure that postmasters can have confidence in their future relationship with it.
It is important that the necessary support for postmasters to operate branches successfully is available. That includes newly established area managers to deliver support on the ground, an improved branch support centre to support teams throughout the UK, an overhaul of postmaster training and, above all, a further increase to postmaster remuneration, as we heard earlier.
In terms of the management of the Post Office, there is a new chief executive officer and two new non-executive directors, so its leadership has changed significantly in the last few months as a result of the situation. I recognise the strength of feeling surrounding the case, which is why the Government and I are determined to take the necessary steps to ensure that lessons are learned from the Horizon litigation and that past issues will not be repeated.
We have talked about the independent review, which the Prime Minister mentioned a couple of weeks ago. We are looking at the best way to do it. There will be a further announcement as soon as possible in the very near future. I know that hon. Members want progress, but I want to ensure that we get it right, rather than rushing into the terms of reference and other details. I want to make sure, as I said, without hiding and without washing my hands of it, that we actually get something that means something to the affected postmasters.
Lucy Allan
Does the Minister agree that the most important thing is for the wrongful convictions to be overturned? We cannot learn lessons and move forward if that is not addressed. Will he please address that point?
Paul Scully
That is why the CCRC is looking at those cases and will therefore be able to refer them to the Court of Appeal accordingly. That option is now available, which would not normally be available without the CCRC looking at those cases.
I look forward to speaking at the Select Committee hearing that is due to be held on 24 March, covid-19 notwithstanding. The Government continue to proactively challenge the Post Office to restore and strengthen its relationship with postmasters and to deliver the terms of the settlement. On Monday, I met the Post Office’s chair and CEO to seek assurance on the steps being taken. Alongside my officials, I will work to make sure that we hold them and their governance to account.
In terms of future governance, the Post Office is a large, complex and diverse business, so it is important that it is allowed the commercial freedom to compete in the challenging markets it operates in. It must, however, be accountable to the Government for its decisions, as we have heard. Following the litigation and the subsequent settlement, the Government will monitor the Post Office closely to ensure that it delivers on its commitments to improving the organisational relationship with postmasters.
Paul Scully
I will not, because I am running out of time. I stress that the Government have robust mechanisms in place to maintain oversight of the Post Office, and they are regularly reviewed. I have regular meetings with its chief executive officer and chair, and the Government have increased the frequency of wider shareholder meetings to make sure that, among other things, the actions arising out of the litigation can be tracked. UK Government Investments, as the shareholder representative for the Department for Business, Energy and Industrial Strategy, challenges the Post Office on its corporate governance and strategy, and on its stewardship of financial and other resources on behalf of shareholders, as well as holding a non-executive seat on Post Office Ltd’s board.
The Department also recently expanded the BEIS Post Office policy team, which works closely with UKGI to hold the Post Office to account at official level. We have a new framework document that makes sure that the responsibilities and accountabilities of the Post Office, BEIS and UKGI are clearly defined. We will publish that soon. It includes an open and transparent information-sharing agreement between the Government and the Post Office.
I will meet the Communication Workers Union, which has been referred to, at the end of the month to understand the views of postmasters—I look forward to that—and will be tracking progress at the highest levels of the Post Office in quarterly ministerial meetings with the CEO, Nick Read. Governance arrangements between the Government and all its arm’s length bodies are kept under regular review. In the light of developments in the Post Office, the Government have considered and addressed all those arrangements.
The right hon. Member for North Durham talked about the Post Office’s right to prosecute. This was a private prosecution; individuals and companies can bring such prosecutions—they are not limited to the Post Office. There is, however, a continuing duty to disclose material information that comes to light that might relate to the safety of any conviction, so the CCRC and those convicted will be able to take up that information.
I will write to the right hon. Member for North Durham with more detail about the Post Office serious case review team to which he referred. BEIS has pressed management on the issues around past prosecutions of postmasters, instigated a review of the Post Office’s handling of that in 2015, and supported the Second Sight mediation scheme. The chair committed to the review in 2015, but it took all the litigation for all the facts to come to light. The suspense account was referred to; Nick Read wrote to Lord Arbuthnot recently on the subject, and we will monitor it closely. On the CCRC and the convictions that the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) talked about, there is a meeting on 24 March to consider those cases further.
To conclude, I reassure the House that the Government are working hand in hand with post offices, the Post Office, postmasters and other stakeholders to ensure that there is follow-through on the lessons learned from the litigation and the steps to be taken following the settlement. I look forward to sharing with Members as soon as possible further details of the review on the issue promised by the Prime Minister. I will leave a minute for the right hon. Member for North Durham, but I thank all postmasters—those impacted by the litigation and those not—for the value that they add in providing an exceptional service to communities, people and businesses across the UK, and for their contribution to this case. I thank hon. Members once again for their contributions to this excellent debate, and for their interest in the Post Office.
Mr Kevan Jones
I thank all hon. and right hon. Members who took part in the debate. Could I say one thing to the Minister? He should not just parrot what his civil servants say to him. The court case did not result in a comprehensive settlement. He has admitted that the Criminal Cases Review Commission is settling cases that did not come before the court. His Department did not even know what that was when we rang it this week. Two such cases were settled in the last month for £300,000 each. If we are to get justice, we have to look at giving the same amount of compensation to those who took the court case forward.
The Minister has an opportunity here. I have been a Minister, and it is a great privilege, but it is not about sitting on that Front Bench or carrying the red box; it is about making a difference. The Minister has an opportunity to make a real difference and put right a wrong. He cannot carry on as his predecessors have done and ignore the truth. I challenge him: be brave, Minister. Please, put this right; it is in your hands. No matter what obstruction he has from his officials, he should challenge them.
Motion lapsed (Standing Order No. 9(3)).
Business without Debate
Gambling Advertising in Sport
(4 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Carolyn Harris (Swansea East) (Lab)
Before we proceed, I should say that we have had official apologies from the hon. Member for Strangford (Jim Shannon), who is unable to be with us but sends his best wishes.
Gambling advertising in sport has grown exponentially since the Gambling Act 2005, and gambling is now virtually synonymous with sport. With 1.8 million at-risk gamblers in the UK and approximately 500 suicides linked to gambling every year, this is something that should be of huge concern to every one of us.
Although all sport is affected by gambling, there are some frightening statistics on the relationship between gambling and football, the nation’s favourite game. Half of all premier league shirts are emblazoned with gambling-company logos, with 10 out of the 20 premier league clubs having signed deals worth a combined £69 million. Malta-based firm Betway is the biggest contributor, as a result of its £10 million deal with West Ham. Clubs stand to earn nearly £350 million from such deals in the coming season—that is an increase of more than 10% on the 2018-19 season.
Betting’s dominance is even more pronounced in the championship, where 17 out of the 24 club shirts display a betting logo, meaning that 27 of England’s top 44 clubs have secured highly profitable shirt-sponsorship deals with the gambling industry. It frightens me how much influence those logos will have on children, and on those who are already struggling with a gambling addiction.
I have spoken to problem gamblers who have freely told me that they watch football merely to seek out the names of new companies with which they can open gambling accounts. With high-profile names further promoting these deals, gambling will be even more normalised among young people. An example is Wayne Rooney, who has been wearing the No. 32 shirt at Derby County since January, as part of the club’s partnership with 32Red.
Although around 80% of gambling advertising budgets is now spent online, there is still a worryingly vast amount of opportunities during sports programmes on television for vulnerable people to be bombarded with gambling advertisements. In a recent study, Professor Jim Orford from the University of Birmingham noted that gambling logos are on screen for 70% of the time during “Match of the Day” programmes in the United Kingdom. Analysis of live sports on television found that gambling adverts are particularly prominent during football matches. During one game between Scottish teams Rangers and Celtic, gambling brands were visible on 920 occasions—that is equivalent to once every 10 seconds.
David Linden (Glasgow East) (SNP)
I thank the hon. Lady for giving way. I declare an interest, in so far as I am the MP for Celtic football club, which is in my constituency. I must confess that I am quite uncomfortable with both Rangers and Celtic having such sponsorship on their tops. In a debate in Westminster Hall earlier this week, the Minister was keen to tell us that attendance at football is going up. The reality is that the demographic tends to be young, low-income men, and the exposure to these betting firms is not good for public health. I commend the hon. Lady for raising this issue, and I hope she will keep going and ask these clubs to think again.
Carolyn Harris
I will come to that in my speech.
Shockingly, gambling advertising is also prevalent on the shirts in the video game “FIFA 2020”—the country’s best-selling video game, which is recommended for ages three and above and is a firm favourite of many young children. Those children may not be aware of the nature of the sponsors’ business, but they will be aware of the names, and in time, they will come to realise the type of company that those names represent.
An analogy of this is my assistant’s 11-year-old son, Thomas. He can easily identify the flags of the world from just playing FIFA games. For obvious reasons, we have not asked him to identify the logos of the gambling companies, but children are absorbing this information every time they play these games.
It certainly feels like the gambling industry is tightening its grip on the world of sport, and especially football. Nearly every club now has an official gambling partner, and aside from the shirt sponsorship deals, many clubs have betting outlets inside their stadiums, and many leagues are sponsored by the industry. As we have learned from the recent Bet365 debacle, until recently, some matches were only available through betting company apps.
In recent weeks, I have written to the big six Premier League clubs—Liverpool, Manchester United, Manchester City, Tottenham Hotspur, Chelsea and Arsenal—to ask them to meet me and colleagues from the gambling-related harm all-party parliamentary group, to discuss the deals they have with gambling companies and their plans. Interestingly, Tottenham replied within 24 hours, readily agreeing to meet, while Manchester United contacted my office to say they had asked the Premier League to represent them at a meeting. I have not heard back from the other four. I understand the importance of an industry body having a presence at a meeting, but I see no purpose in their attending in place of the clubs to talk about the deals that the clubs are responsible for.
It really worries me that vulnerable people are being groomed by the gambling industry through advertising. The Advisory Board for Safer Gambling has said that, by not taking action to limit the exposure of young people to gambling advertising,
“we are in danger of inadvertently conducting an uncontrolled social experiment on today’s youth, the outcome of which is uncertain but could be significant.”
The sector urgently needs to adopt a more responsible approach on advertising, particularly during sports programmes, to protect children and the vulnerable. Paddy Power’s “joke” football shirt sponsorship deal last year with Huddersfield Town, which got huge publicity, is an indictment of the current state of gambling sponsorship proliferation.
So, what should be done? First, of course, the industry itself must take action. The gambling-related harm APPG welcomes the whistle-to-whistle television ban. But for the advertising ban to be truly effective, these companies should go even further, to include shirt and league sponsorship and digital advertising around the pitch. Otherwise, children and vulnerable adults will continue to be bombarded with gambling adverts. That is something we hope to discuss with the Premier League clubs we have written to, who I hope to eventually get to meet.
I must also mention Lewes football club, which is soon to launch a charter to get other clubs to commit to ending gambling advertising in football in the same way that it has. The charter urges clubs to: never accept any form of sponsorship or donation from the gambling industry; actively promote and raise awareness of the risk of gambling addiction; lobby fellow clubs, leagues and the Football Association to refuse to advertise or promote gambling in football; and to support people and families affected by gambling addiction. I have had a brief conversation with my local club, Swansea City, which has gambling sponsorship but understands the issues and is actively seeking a way to sign up to that charter when it is in a position to do so.
It is also worth bearing in mind that the broadcasters have been quite resistant to the clampdown on advertising. Television companies have an important role to play, and they must start acknowledging and improving how they deliver on their duty of care to viewers.
Given the limited progress on dealing with gambling advertising, it seems that the time has come for a blanket ban on gambling advertising in sport. That is what we had before the Gambling Act 2005, and I am going to usurp the Minister by saying that, yes, that was Labour Government legislation, but I was not a member of that Government. Had I been, I would have objected to that Act in the strongest terms.
In the upcoming gambling review, there is much that I will ask the Government to do. However, on this issue, I urge them, as a matter of urgency, to bring an end to the highly profitable, yet highly damaging relationships between sports clubs and the gambling industry. A good place to start would be to talk to organisations such as The Big Step, which work tirelessly to promote the message of no gambling advertising in sports.
Many of us are willing to work with the Government to get this right. We have the voices. We have the knowledge. I ask the Government to let us help them transform and neutralise the damaging consequences of problem gambling.
The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)
I thank the hon. Member for Swansea East (Carolyn Harris) for her tireless work in advocating for those who have suffered, or are at risk of suffering, gambling harms. I have no wish to make party political points on this issue, because I believe there is a wish on both sides of the Chamber for further action.
I would like to address the concerns that have been raised about gambling advertising and sponsorship of sport. The Gambling Act 2005 does indeed permit licensed operators to advertise in a socially responsible manner. Gambling is a permitted activity and a competitive market in this country, so it follows that businesses in the sector are able to market their product. The ability to advertise is a key advantage that licensed operators have over the black market. If we removed that advantage, we would undermine our ability to ensure that gambling is conducted in a fair and open way, that it remains crime-free, and that children and vulnerable people are protected.
Matt Rodda (Reading East) (Lab)
I am grateful to the Minister for giving way on that point. I appreciate the point he is making about gambling being a legal activity. One thing that struck me in the speech by my hon. Friend the Member for Swansea East (Carolyn Harris), which was so eloquent and detailed, was the sheer, overwhelming presence of gambling advertising, particularly when it comes to young and vulnerable people. My son, who is now at university, used to play FIFA20, or its predecessors. Many children do, and the fact that this advertising is accessible to children is deeply worrying. It is also worrying that it is so ubiquitous at sports grounds, where young people are bombarded by it. Will the Minister say something about the way in which the Government could scale back the level of advertising?
Nigel Huddleston
I thank the hon. Member for his comments. He may be tempting me to pre-empt the conclusions of the gambling review that we will be conducting, and I will say more about it later. However, that review will be forthcoming—it was in the manifesto—and we will all have plenty of opportunity to look further into these issues. I cannot say too much more on the specifics at the moment, but I understand the point he is making.
It is true that operators are spending far more on advertising. Research has indicated that operators have increased their spend on advertising and marketing significantly in recent years. It would be easy to assume that that has led to increased rates of gambling or of problem gambling, but, according to the Gambling Commission, the percentage of those who gambled in the last year was 47%, which was 1% less than the percentage who gambled in 2016, and rates of problem gambling have remained relatively steady, at below 1% for the past 20 years. Before the hon. Member for Swansea East intervenes, as I know she will on that point, let me say that that is too high—that is one thing we agree on. We continue to keep a careful eye on the evidence, but more advertising does not seem to lead to more people gambling or more people suffering from gambling problems.
However, there are clearly legitimate concerns about problem gambling. I am pleased that the industry has listened to concerns, such as those raised by the hon. Lady, and has acted to some extent: it has extended existing restrictions on pre-watershed advertising to include live sport—the so-called “whistle-to-whistle ban” that she mentioned.
Protecting children and other vulnerable people from gambling harms is a priority for the Government. Gambling advertising, like alcohol, is already governed by strict rules to ensure that it is not targeted at children and is not of particular appeal to them. Where advertising breaches these rules, the commission can and does take action.
We know that millions of people gamble each year and that nearly 7% of the population bet on sport last year. Most of those people will suffer no harm, but gambling does carry risks. That is why, as part of the last gambling review that took place between 2016 and 2018, we secured a commitment from industry to fund a multimillion-pound safer gambling advertising campaign to highlight the risks and encourage safer gambling behaviours.
Of course, advertising is not the whole story; sponsorship is an important source of income for sporting teams and bodies, as the hon. Member for Swansea East mentioned. The Gambling Commission has been clear that operators must undertake their sponsorship activities in a socially responsible way. The FA has strict rules about the size and placement of operator logos and has taken action when those have been breached. Logos cannot feature on shirts worn by youth team players and on merchandising, including shirts in children’s sizes. Paddy Power’s stunt with Huddersfield led to the FA fining the club.
Carolyn Harris
Perhaps I can just enlighten the Minister: if a child is of a larger size and cannot get a shirt to fit in a child’s size, they end up having the logo on the front of it, so unless clubs make a special effort to have adult shirts without logos, which they are obviously not going to because it is not in their interests, children are able to wear shirts with logos on.
Nigel Huddleston
The hon. Lady is making a fair point and, as I said, I am sure that all these things will be considered in the gambling review. The remit of the review has not yet been scoped, but she will have strong opinions on it—of that I have no doubt.
Matt Rodda
The Minister is being extremely gracious to other Members in giving way. Perhaps the review might consider the family nature of watching sport in Britain because, in many cases, families are going to football or to other sport together, and the adults and children are wearing replica shirts together. They are watching the team together, so the presence of the gambling logo is ubiquitous—it is everywhere. I hope that he can address that issue in his review and take it very seriously, because it is easy for children to inadvertently be exposed to logos or attractive advertising, which can affect their perception of gambling very seriously.
Nigel Huddleston
The hon. Gentleman makes an important point. One of the great joys of sport is that it can be a family activity, and we want to minimise any dangers that can be the unintended consequences of participating or observing those activities.
The gambling industry has committed to developing and adopting a new code of conduct for sponsorship activities by the end of 2020. We and the Gambling Commission will be reviewing its efforts closely to ensure that they go far enough. As I have mentioned, we have committed to reviewing the Gambling Act 2005 to make sure that it is fit for the digital age. We will announce further details in due course, but I assure the hon. Member for Swansea East that the Government and the Gambling Commission will not put our work to minimise harm on hold while the review takes place. We will always act on the evidence to prevent harm.
We have already delivered on our manifesto commitment to ban credit card gambling, and we have made it mandatory for operators to be part of GAMSTOP, the national online self-exclusion scheme.
Charlotte Nichols (Warrington North) (Lab)
I thank the Minister for giving way, and my hon. Friend the Member for Swansea East (Carolyn Harris) for securing this vital debate and the important points that she made about gambling advertising, particularly to young people in video games such as FIFA. I am pleased that there are restrictions on gambling on credit cards, for example, but bets from student loans are a real concern for young people getting into problem gambling. Will the Minister say whether that will be looked into as part of the gambling review?
Nigel Huddleston
The hon. Lady tempts me to pre-empt the scope of the review, but we will listen very carefully to what elements should be considered, and again, she makes an important point. I reiterate that, during the review and in the run-up to the review, we will not stop looking at all elements of gambling harm. Although the review is an important element of the debate, we need to continue the dialogue while it is happening, and I believe I will be coming to the APPG at some point in the not-too-distant future to continue that dialogue.
At the same time as strengthening protections, we are expanding the safety net for those who get into difficulty. The NHS long-term plan will see up to 14 new specialist gambling clinics across the country, three of which are now open. We are also working closely with the Department of Health and Social Care and other Departments on a cross-Government addiction strategy, which will be published later this year. We are, of course, in very difficult times, and I assure all hon. Members that support is, and will continue to be, available for those who need it. The national gambling helpline remains open around the clock.
I am pleased to see the House’s commitment to the aim of reducing gambling harms, as well as its enthusiasm and advocacy for sport itself. I reassure hon. Members that strong protections are already in place, and the Government will continue to act on the evidence to make gambling safer.
Question put and agreed to.