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Richard Thomson (Gordon) (SNP)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
Before I turn to the question, the tragic loss of the Joanna C on Saturday is a sad reminder of the dangers that our fishermen face every time they go out to sea. We are all incredibly grateful for the bravery and dedication of the Coastguard, the Royal National Lifeboat Institution and all those involved in the search. Our thoughts are with the families of Adam Harper and Robert Morley, and all the families and those affected.
The Government have offered the European Union a free trade agreement along the lines of the EU-Canada one, which would involve zero tariffs on all goods, including fish and fish products. We hold regular discussions with both the catching sector and the fish processing sector to discuss the great opportunities that will arise at the end of the transition period.
Richard Thomson
I associate my group with the comments of the Minister. It is a timely reminder of the high price that is sometimes paid for putting food on our plates at home.
Non-tariff barriers are also a concern for the fishing industry, as are tariffs. This week’s test run for post-border transition procedures demonstrated the severe chaos that might be expected in the new year. I am sure that the Minister appreciates fully that seafood products need to be delivered to markets timeously. So what assurances can he give to the catching and processing sectors that delays will not equal ruined produce and ruined businesses?
George Eustice
We have been working with the fishing industry and local authorities to ensure that they have the capacity in place to employ the environmental health officers necessary to issue both the catch certificates and the environmental health certificates. We have about 1,000 officers now who can issue export health certificates for fish. It is the case that there are some concerns in Scotland, where the Scottish Government potentially have a gap in capacity of 100. We are working with them to try to offer our help to ensure that that gap can be filled.
Deidre Brock (Edinburgh North and Leith) (SNP)
I, too, associate myself with the Secretary of State’s remarks. That reminds us why this industry is so important to us and why it tugs at our hearts when we hear of such sad events.
Tariffs are a great worry for many other sectors as well. Tariffs of a possible 48% are a huge concern for the sheep sector, so the Secretary of State’s suggestion that sheep farmers could simply switch to beef production if punitive lamb tariffs cause their business models to crash has angered many Scottish farmers and crofters, who have spent many years building up the high reputation that Scotch lamb enjoys for quality. The National Sheep Association Scotland has called for assurances that a compensation scheme will be ready and waiting. What details can he outline today of such a scheme?
George Eustice
I always advise people to look at what I actually said, rather than at the Twitter attacks on what I might have said. I never said that specialist sheep farmers and crofters should diversify into beef; I explicitly said that some of the 7,000 mixed beef and sheep enterprises might choose to produce more beef and less lamb if the price signal suggested that they should.
Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
The Scottish Seafood Association has joined other food and drink leaders with a recent letter to the Prime Minister. The message is clear: tariffs mean enormous damage to our industry, and that is on top of covid losses of an estimated £3 billion. So when will the Minister reveal details of the financial support that is so clearly desperately needed?
George Eustice
Tariffs on fish, particularly the fish that we export, are typically far lower than on many agrifoods. The average tariff on the shellfish that we export is about 8%. Obviously, we would prefer there to be zero tariffs on all goods, and that is the offer that the Government have made to the European Union—in both directions—but the fishing sector generally recognises that, if it needed to pay tariffs, it could pay those tariffs, and the European Union would have to face higher prices.
Mr Speaker
Question 4 has been withdrawn. If the substantive question cannot be answered, do not worry. I call the shadow Minister.
Daniel Zeichner (Cambridge) (Lab)
May I associate those on this side of the House with the Secretary of State’s comments on the appalling loss of the Joanna C?
Twenty-six per cent. of our food comes from the European Union, and it is reported that last week the Department for Environment, Food and Rural Affairs’ head of food security warned industry reps to expect just 40% flow rates. I am sure the Secretary of State will want to provide reassurance on that, but as we have already heard, his attempts to placate livestock farmers recently led to some pretty dreadful headlines in the farming press. “Laughable” was the comment from the Farmers Guardian. So can he do better today and explain the plans he has in place to keep our food supplies flowing in just 35 days’ time?
George Eustice
We have worked with industry to ensure that the capacity is in place to issue export health certificates, and we have been contacting meat processors, fish processors and others in the sector to ensure that they are prepared for the new administration that will be required, and of course we continue to work on plans to ensure that goods flow at the border.
Laura Trott (Sevenoaks) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
The Government have banned the use of microbeads in cosmetics and banned the use of plastic straws, stirrers and cotton buds, and the 5p charge for single-use plastic bags has reduced their use by 95% in the main supermarkets. We are increasing the charge to 10p and extending it to all retailers. In addition, we are seeking powers in the Environment Bill to require similar charges for single-use plastic items, to make recycling collections more consistent and to reform packaging producer waste responsibility schemes.
Laura Trott
Earlier this year, I was written to by year 6 pupils in the Chevening and St Lawrence primary schools. They were asking me to protect the environment, and reducing plastic pollution was top of their list. I am sure they will have been reassured by the Secretary of State’s answer, but can he reassure them further that we will act to stop this attack on our environment and that they will see change in their lifetime?
George Eustice
My hon. Friend makes an important point, and I congratulate the Chevening and St Lawrence primary schools on their interest in this. All hon. Members cannot help but have noticed the rising awareness within all our schools of the scourge of plastics in particular and the action that must be taken. In my own constituency, I have been contacted by schools such as Lanner, Troon, Treleigh, Rosemellin and Roskear on this very matter just in the past year. We are working very hard to address the concerns raised by pupils in my hon. Friend’s primary schools.
Sir Roger Gale (North Thanet) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
The national pollinator strategy sets out the actions we are taking with partners to protect pollinators. It includes dealing with habitat loss and the potential harm from pesticide use, invasive species and climate change. Our future agriculture policies will help to improve biodiversity and support habitats for pollinators, building on existing agri-environment measures to enable many more farmers and land managers to take positive action.
Sir Roger Gale [V]
Thank you, Mr Speaker, from the garden of England. My right hon. Friend will know that the value to the economy of pollinators is estimated at about £691 million. Some 60% of our native pollinators are in decline, and we have lost 75% of them over the past 25 years. Will he support me in backing Kent’s Plan Bee, which is seeking to establish 5,000 miles of B-lines across the United Kingdom?
George Eustice
That sounds like a very interesting project, and I would certainly be willing to meet my right hon. Friend and representatives in Kent to discuss it. Our future environmental land management scheme will encourage the creation of habitats for pollinators, and our local nature recovery plans, to be advanced by local authorities, will also have a role to play.
Sir David Amess (Southend West) (Con)
Mark Jenkinson (Workington) (Con)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Victoria Prentis)
In addition to the full range of financial support available to all businesses and employers, we have established an extra £100 million support fund for those who are facing severe financial difficulty, and the deadline for applications to the fund has been extended to the end of January.
Sir David Amess
On a recent visit to Chester zoo, I saw its excellent conservation work and learned at first hand about the remarkable way it is coping with the coronavirus pandemic. However, the zoo animal fund criteria for access seem to be very peculiar, because zoos seem to have to be on the verge of closure before they can get any money. Surely that is wrong. Will my hon. Friend look at those criteria again, please?
Victoria Prentis
We listened to concerns following the roll-out of the initial support scheme and we have made changes to reflect that. The zoos animal fund, which is simpler to apply for, is now open to zoos that have up to 12 weeks of reserves left. It can be applied for in advance of that and can include applications for essential planned maintenance.
Mark Jenkinson
As we have just heard, zoos have an important conservation role to play. The white-tailed eagle is listed in our 25-year environment plan as a species whose reintroduction we could support as we develop our nature recovery network. Cumbria is at the forefront of nature recovery, as we have a local nature recovery strategy pilot and, separately, we are in a group that has submitted a bid for feasibility work on the white-tailed eagle’s reintroduction. Will my hon. Friend meet me to discuss how her Department might assist with that proposal?
Victoria Prentis
The 25-year environment plan encourages the reintroduction of species such as the white-tailed eagle. I know that my hon. Friend is aware of the funding pots on offer, and Department for Environment, Food and Rural Affairs officials would be very pleased to meet him and the project scheme to discuss what further action could be taken.
Mr Speaker
We go now to David Mundell, but I found that a very strange grouping.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
Lamb producers have enjoyed a very good year in 2020. A significant increase in lamb imports by China, combined with tighter supply globally, has contributed to high prices and confidence in the sector, with prevailing market prices typically 10% to 15% higher than last year. However, we recognise that historically the lamb sector has been more reliant on the EU market than most other farming sectors, so we stand ready to help it identify new markets in future.
David Mundell
I hope you did not find me very strange, Mr Speaker. Upland sheep farming is hugely important to my constituency, which is why, I, like those farmers, very much welcomed the Secretary of State’s comments yesterday at the Scottish Parliament’s Rural Economy and Connectivity Committee that he does have well-developed plans in place to support upland sheep farming in the event that a deal is not possible with the EU. Perhaps he could set out some further reassurance to those farmers today, because many of them have to take decisions right now about their forward planning and what would be in place if there is no deal with the EU.
George Eustice
I can say that 18 months ago, in preparation for the first potential no-deal, the Government, working with the Rural Payments Agency, had developed detailed plans to be able to support the sector in the short term. Those plans are still there and still ready to be activated, but in the medium term, in the event of there being no further negotiated outcome, we will be helping the sector identify new markets.
Mark Logan (Bolton North East) (Con)
Andrew Jones (Harrogate and Knaresborough) (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, and our Environment Bill, which I am pleased to say is making huge progress in Committee, 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.
Mark Logan
How can Bolton avoid a future of £15 congestion taxes? How can Bolton deal with being in a clean air zone akin to the distance between Westminster, where we are standing, and Watford, of almost 500 square miles?
Rebecca Pow
My hon. Friend has engaged continuously on this issue and is really standing up for his Bolton North East constituency. I assure him that only the most polluting older vehicles are charged in a clean air zone, and it is not a congestion charge; the Greater Manchester plan does not include charging private cars, and the evidence provided by Manchester authorities to date shows that this is not needed. We have provided £41 million in advance of the zone to help drivers and businesses in Greater Manchester that are least able to upgrade their vehicles, with further funding to be allocated. Manchester authorities are consulting on their plan until 3 December, and I encourage people to engage with the consultation.
Andrew Jones
In Harrogate and Knaresborough there are three air-quality management areas. The one at Bond End in Knaresborough saw junction improvements a couple of years ago that improved the situation, but another, at Woodlands junction in Harrogate, continues to break NOx levels, and that must change. What help is my hon. Friend giving to local authorities to help them to reduce NOx levels?
Rebecca Pow
I thank my hon. Friend for putting the case for those roads. Local authorities have a range of tools that they can use to reduce air pollution, and we are building on them through the Environment Bill to ensure that local authorities have a clear framework and simple-to-use powers to tackle air-pollution issues in their areas. We are also broadening the range of bodies required to take action to improve air quality. As a former Transport Minister, my hon. Friend will understand what I mean by getting other bodies involved—we want them to work closely on the air-quality management plans. We will also continue to provide support through the air-quality grant.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Average roadside nitrogen dioxide concentrations remain below levels observed in the previous three years, despite some increases as the March lockdown measures were eased. Working closely with Ministers in the Department for Transport, we continue to drive forward our ambitious plans to improve air quality, and we are delivering our clean air strategy and working in partnership with local authorities to deliver measures to tackle nitrogen dioxide pollution. The Environment Bill will enable greater local action to tackle air pollution.
Dr Huq
As we hopefully exit a respiratory pandemic, technology grants for home-working, public transport vouchers and the cutting of staff parking permits could all be part of a joined-up strategy for employers to make driving into the office a thing of the past in the new normal, or at least radically reduced, with things such as vehicle scrappage, all-electric fleets and a proper charging network for those who cannot avoid driving. Will the Government adopt a proper, joined-up, cross-governmental strategy, rather than the piecemeal, far-off future targets that they have now?
Rebecca Pow
The hon. Lady gives some examples, but she is somewhat aggressive in her approach, in that I work so closely with the Department for Transport and the Department of Health and Social Care so that we do have a joined-up approach on air quality, and our clean air strategy goes right across all Departments. Some £1.2 billion from the Department for Transport is being devoted to cycling and walking investment, and the bike vouchers literarily went like hot cakes in the summer. We do work closely together. The hon. Lady raises some important points, and we are looking into all the options because we know that times are changing and work patterns are changing.
Ruth Jones (Newport West) (Lab)
We are one United Kingdom, so I know that the Minister will have paid keen attention to the work happening, albeit devolved, in other parts of the country to tackle toxic air quality and pollution. Will the Minister confirm that she has read the Welsh Government’s clean air plan and share with the House some of the tips she has picked up?
Rebecca Pow
I thank the hon. Lady for bringing Wales into the discussion, but of course air quality is a devolved matter—she serves on the Environment Bill Committee, in which we have said so many times that it is a devolved matter. I hope that she and the Welsh Ministers have read our clean air strategy, because it is considered a global leader, but I am always open to ideas. If we can pick up tips from other places, I am all for it.
Fleur Anderson (Putney) (Lab)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
Air pollution can be harmful to everyone; however, some people are more affected than others. My Department has commissioned research into inequalities of exposure to air pollution, and monitors emerging evidence investigating air-quality impacts on BAME communities. That research has shown that those BAME groups are disproportionately affected by poor air quality, partly because larger numbers of BAME people live in urban areas where air pollution tends to be worse.
Fleur Anderson
I am the MP for one of those urban areas where black and ethnic minority constituents are disproportionately affected by both covid-19 and air quality. Has the Secretary of State held recent discussions with his colleagues in the Department of Health and Social Care? Will he make a statement about specific actions that will be taken on this issue?
George Eustice
Of course we talk with our colleagues in the Department of Health and Social Care, the Department for Transport and the Ministry of Housing, Communities and Local Government on all matters relating to air quality in some urban areas. We intend to take action through the Environment Bill by setting new targets on air quality. One of the targets that we are investigating relates to the impact on particular populations in particular areas.
Dr Kieran Mullan (Crewe and Nantwich) (Con)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
The Government are currently investing £2.6 billion between 2015 and 2021, approximately £650 million of which will be allocated to local authorities. Between 2021 and 2027, we will invest £5.2 billion in flood and coastal defences, in addition to a £200 million resilience innovation fund, which were all mentioned yesterday in the spending review. In July 2020, we announced an additional £170 million to accelerate shovel-ready flood defence schemes. Funding for projects is allocated according to the rules governing DEFRA’s existing six-year capital programme.
Dr Mullan
Maw Green Road in my constituency has been hit by severe flooding. In fact, residents have been seen canoeing their way out. Cheshire East local authority has not been successful in its applications for financial support to tackle this issue. Will the Minister agree to meet me to look at its proposals to see what we can do to support it financially so that it can tackle this matter?
Rebecca Pow
We all understand the difficulties that flooding can bring and my hon. Friend is right to raise it. I understand that the Environment Agency recently attended a meeting with the Lead Local Flood Authority to address the surface water flooding in Maw Green Road, and that the LLFA is pursuing specific actions to address the situation, including seeking Department for Transport funding to alleviate flooding under the railway bridge upstream. Therefore, no DEFRA floods funding has been applied for in this location, but, obviously, I am happy to have a chat with him and look into this matter.
Neil Parish (Tiverton and Honiton) (Con)
The environmental land management scheme could do much to help stop flooding, especially flash flooding. How advanced is the ELM scheme, and when will we hear about it? In the future, can we ensure that the payments are enough, so that people can farm water as part of their farming practice?
Rebecca Pow
My hon. Friend, I know, speaks from experience as he has a farm right by a lot of water, so he raises a very important point. May I just say, Mr Speaker, that we have tremendous support on the Conservative Benches today, which, I think, demonstrates the understanding of these issues. My hon. Friend was right to raise the ELM scheme. Our future farming policy will be centred around support aimed at: incentivising sustainable farming practice; creating habitats for nature recovery; and establishing new woodland ecosystem services to help tackle climate change. We will help farmers to deliver environmental public goods, which, of course, bring in things such as natural flood management, which he has mentioned. They will be an important part of our new future, with things such as leaky dams, slowing the flow and, of course mixed in there, good soil management, which is something that is very dear to my heart.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
Water companies are committed over the next five years to a significant programme of improvements and to the monitoring and management of storm overflows, costing around £1.2 billion. However, there is more to do, and I met the chief executive officers of water companies in September and made it clear that sewage discharges must be reduced. To achieve that, I have set up a taskforce bringing together the Government, the water industry, regulators and environmental non-governmental organisations to develop actions to address the issue.
Dame Diana Johnson [V]
It is good to hear that a taskforce has been set up. In 2019, Yorkshire Water spent 616,643 hours discharging raw sewage into local rivers, which is the worst figure in England. It posted profits of more than £212 million in 2018-19—very much a case of private affluence and public effluence. We need to raise standards, and the Environmental Audit Committee Chair has proposed measures to do that. Will the Government be supporting the proposals of the right hon. Member for Ludlow (Philip Dunne)?
Rebecca Pow
The hon. Lady touches on an issue to which the Department is giving a great deal of attention. As I said, I have recently met water companies to say that that is not good enough and that they need to improve. The Environment Agency carries out a lot of monitoring on the issue, but the situation is not good enough. The taskforce that I mentioned will be developing short and long-term actions to increase water company investment in tackling storm overflows. The Government are very supportive of the aims of the private Member’s Bill of my right hon. Friend the Member for Ludlow (Philip Dunne); some measures in the Bill could be helpful in reducing storm overflows, and I have asked the taskforce to look at some of those measures. I thank the hon. Lady for her question.
Alexander Stafford (Rother Valley) (Con)
Whiston in Rother Valley has repeatedly been flooded, most recently last year; and people are still out of their homes. In part, this has caused overflow of sewage into the Whiston brook. Indeed, raw sewage went into Whiston brook 43 times last year. However, Rotherham Council has just granted planning permission for 450 homes off Worrygoose Lane, which is directly above the brook. That is going to have a huge impact on Whiston brook. Will my hon. Friend speak to Rotherham Council to convince it that building an extra 450 homes in Whiston is going to flood the brook and bring misery to so many people’s lives?
Rebecca Pow
I thank my hon. Friend for his impassioned question. The national planning policy framework makes it very clear that new developments should be made safe and resilient without increasing the risk of floods elsewhere. The Environment Agency and Rotherham Council have been working together in partnership to find a solution to flood risk in the area. Early studies of the proposed Whiston flood alleviation scheme indicate that the scheme could better protect about 60 houses.
Andrew Jones (Harrogate and Knaresborough) (Con)
The Secretary of State for Environment, Food and Rural Affairs (George Eustice)
Since the last session of DEFRA oral questions, Royal Assent has been granted to both the Agriculture Bill and the Fisheries Bill. The Agriculture Act 2020 gives us the powers to transform the way in which we support farmers and build back nature in the farmed landscape, while the Fisheries Act 2020 gives us powers to become an independent coastal state, and decide who can fish in our waters and under what terms. We will be bringing forward new policies under both Acts in the weeks and months ahead.
Andrew Jones
My right hon. Friend’s Department is a very busy one right now, but may I ask him to look at the issue of animal cruelty sentences? I know that the Government are looking to legislate to increase sentencing. Animals feel pain and emotion, and all of us in this House have probably had terrible cases of animal cruelty in our constituencies, which can be upsetting for all our communities. What steps is my right hon. Friend taking to ensure that there is a good level of enforcement for animal cruelty offences?
George Eustice
My hon. Friend makes a very important point. The Government support extending maximum penalties and offences for animal cruelty. We are supporting a private Member’s Bill currently going through this House to achieve that. Should that not go through, we will introduce legislation in a later Session in this Parliament in order to do that. We are also working with local authorities and others to improve the enforcement of the current animal welfare legislation.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
After the “News at Ten” exposé of foxhunters discussing how to put up the smokescreen of trail hunting when foxhunts break the law—exemptions that they describe as a “good wheeze”—is the Environment Secretary satisfied that the Hunting Act 2004 is as strong as it needs to be to stop illegal hunting? I am not.
George Eustice
The Hunting Act was brought forward by the Labour party, and there is now a consensus across this House that it should remain. Where there is a breach of that legislation, obviously the police can investigate, and they do.
Luke Pollard
No, that is not a good enough answer. We support the strengthening of that Act and I hope that the Environment Secretary will too. Forestry England has just announced a ban on hunts using its land in response to the exposé. Should not other landowners now follow this lead and ban trail hunters from their land as well?
Mr Speaker
Sorry, is someone shouting at the back? Sir Edward, silence a little more—come on.
George Eustice
The Government believe that the Hunting Act is sufficient. Where there are breaches, it should be enforced. It is for individual landowners to choose, as they always have done, whether they would like hunts on their land.
Peter Aldous (Waveney) (Con)
George Eustice
For now, the residual bit of the European Maritime and Fisheries Fund continues to be something that fishing communities can access, but we will be replacing the EMFF with a domestic fund, and we will say more on this in due course. I am aware of the REAF project in my hon. Friend’s constituency. There are great opportunities for fishing communities along the east coast to benefit from our departure from the EU.
Munira Wilson (Twickenham) (LD)
George Eustice
Under the Environment Bill, we will have a 25-year environment improvement plan that addresses issues such as air quality. There will also be targets set for air quality under the Bill.
Cherilyn Mackrory (Truro and Falmouth) (Con)
George Eustice
My hon. Friend and neighbour in Cornwall makes a very good point. As a fellow Cornish MP, of course I want to see the interests of the Cornish fishing industry prosper in the future. In many cases, we have had a profoundly unfair share of stocks in the Celtic sea, and that will now change.
Dame Diana Johnson (Kingston upon Hull North) (Lab) [V]
George Eustice
We are in discussions on this matter with ministerial colleagues in the Ministry of Housing, Communities and Local Government. The hon. Lady will be aware that a planning Bill is coming forward, and one of the things we have already said we would like to do is strengthen the role of the Environment Agency as a statutory consultee on future planning developments.
Miss Sarah Dines (Derbyshire Dales) (Con)
George Eustice
My hon. Friend makes a very important point. Our future policy will be about incentivising, encouraging and supporting sustainable agriculture so that we have sustainable food production but also environment improvement.
Nadia Whittome (Nottingham East) (Lab)
George Eustice
Last week the Prime Minister announced a new round for the green recovery challenge fund—an additional £40 million—and the Chancellor yesterday confirmed the spending that we intend to put through the nature for climate fund as well.
Rob Roberts (Delyn) (Con)
Ruth Cadbury (Brentford and Isleworth) (Lab)
George Eustice
I do not accept the point that the hon. Lady makes. We have recently banned plastic stirrers, plastic straws and plastic cotton buds. We are considering other bans on single-use items, and the Environment Bill brings forward extended producer responsibility.
Sir Edward Leigh (Gainsborough) (Con)
The Second Church Estates Commissioner (Andrew Selous)
Both archbishops joined other faith leaders earlier this month in writing to the Prime Minister to highlight the importance of public worship. The worship of Jesus is the spiritual fuel that keeps the engine of the Church running.
Sir Edward Leigh
Over the past 1,000 years, we have had a fair proportion of saints and sinners as Archbishop of Canterbury, but one thing that we demand of our established Church is that it provides robust leadership against arbitrary government. I do not know whether my hon. Friend noticed that 90 colleagues and I wrote to the Prime Minister on the subject of the closure of churches, but can he assure me, as a voice of the established Church in this place, that if there is any future proposal to prevent public worship, the Church of England will demand evidence—there has never been a shred of evidence—and we will try to save this very important part of public life?
Andrew Selous
I not only noted my right hon. Friend’s letter, but was one of the signatories to it. Like him, I know that clergy have worked extraordinarily hard to provide covid-secure services. I felt safer in church than in any other public space I have been in during the pandemic. My right hon. Friend makes a very valid point. I have registered that point very strongly, and I will absolutely feed it through to the leadership of the Church of England.
Kerry McCarthy (Bristol East) (Lab)
Andrew Selous
Approximately 35,000 acres of land owned by the Church Commissioners is high-quality grade 1 and 2 farmland, representing 39% of the overall agricultural portfolio. Information on diocesan land holdings is not held by the Church Commissioners.
Kerry McCarthy
I thank the hon. Member for that answer. At the last Church Commissioners questions, he said to me that he strongly wanted to see more trees planted on the Church estate, but that most of the rural estate is high-quality agricultural land and is therefore not suitable. He has just said that 39% is high-grade agricultural land. Does that not mean there is an awful lot of other land on which they could plant trees and help meet the Government’s commitment to increasing woodland cover?
Andrew Selous
As I think I said at the last questions, I commend the hon. Lady for raising this issue and, indeed, for returning to it today, and I genuinely welcome her scrutiny. More than 60% of our farmland is let on secure agricultural tenancies, with the rest on tenancies under the Agricultural Tenancies Act 1995. Both of those limit our ability to intervene directly. However, we do encourage our tenants to farm sustainably and join environmental stewardship schemes to plant trees and hedgerows wherever possible. In addition, we are undertaking a natural capital assessment, which will provide a baseline and trajectory of progress towards achieving lower carbon outputs.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Christian Matheson (City of Chester)
The Electoral Commission works proactively to regulate digital campaigning under the rules currently set out in law. It publishes data on digital spending by campaigners to provide transparency for voters, monitors online campaigning activity and supports campaigners with targeted advice. In 2018, it published a comprehensive package of recommendations that would increase transparency for voters, and it continues to recommend changes that would help voters have confidence about online campaigning.
Alan Brown
I thank the hon. Member for that answer. The reality is that we know that Vote Leave did all sorts of myth-spreading using digital campaigning. The same people then moved and masterminded the Tory 2019 general election campaign, so it is no wonder that the UK Government have not done anything yet to change the rules. Does the commission agree that there has to be not only better regulation, but fines that go beyond business-as-usual amounts, so that they are a real deterrent to myth-spreading online?
Christian Matheson
The commission has recommended that its current maximum fine of £20,000 per offence should be reviewed to ensure that it is proportionate to the income and expenditure of parties and campaigners. As a Member from Scotland, the hon. Gentleman may have noticed that the Scottish Parliament recently increased the commission’s maximum fine for Scottish referendums to £500,000. The commission continues to recommend that its sanctioning powers should be updated by other Governments and for other polls, to provide a more proportionate regime.
Dr Luke Evans (Bosworth) (Con)
Dr Neil Hudson (Penrith and The Border) (Con)
Jacob Young (Redcar) (Con)
The Second Church Estates Commissioner (Andrew Selous)
From 2 December, places of worship can reopen for public worship, and churches and cathedrals can now approach Advent and Christmas with certainty. Clergy have already demonstrated that they have made their buildings covid-secure, and many cathedrals and churches are planning to have multiple services to accommodate more people as fewer are allowed in each service. The further good news is that, while indoor singing is limited to performance only, we can all take part in outdoor and door-to-door singing, staying 2 metres apart or away from the threshold, and nativity plays for under-18s are permitted in accordance with the performing arts guidance.
Dr Evans [V]
I am grateful for my hon. Friend’s comments on services, but at Christmas time, the Church does a lot more—it provides support for our communities through financial advice, fuel and food poverty advice and, of course, the social support that is at the heart of it all. With that in mind, what discussions has he had with local and national Government and the Churches to ensure that they can continue to provide that support in a covid-secure way at Christmas?
Andrew Selous
I know that my hon. Friend takes a close interest in this area of the Church’s work. The Church continues to work with the Government through the places of worship taskforce to advise parishes on how to continue providing critical assistance locally, which they have done wonderfully well. For example, St Peter’s in Market Bosworth, in his constituency, is supporting the local women’s refuge with food and toiletries.
Dr Hudson [V]
I thank my hon. Friend for his answer. Once again, churches have done amazingly through this pandemic, continuing with outreach to their communities. I pay tribute to the churches in Penrith and The Border and across the country that enabled remembrance ceremonies to go ahead this year in challenging circumstances. Does he agree that, as churches look to reopen for worship and other activities in the months ahead, targeted Government financial support for them would be a great way to ensure that their vital community work and support can carry on?
Andrew Selous
Churches did indeed organise very respectful and safe remembrance services. The National Churches Trust estimates that the economic value of our social action is worth around £12.4 billion. I can tell my hon. Friend that 227 churches and cathedrals have been supported by the culture recovery fund, for which I thank the Government.
Jacob Young [V]
I thank my hon. Friend for his answer. Churches in Redcar and Cleveland, such as St Mark’s in Marske and St Cuthbert’s in Ormesby, have gone above and beyond to ensure that the risk of transmission in churches is low. They are a place for people of all faiths and none to find peace in what has been an incredibly difficult eight months. Unfortunately, Advent Sunday this year will fall inside the lockdown, but I am grateful that the Government have said that churches can reopen for the rest of Advent from 2 December. What message does the Church Commissioner have for those churches in Redcar and Cleveland in the approach to Christmas?
Andrew Selous
I am delighted to learn of the important role that churches in Redcar and Cleveland have played in helping people to find peace during this dreadful pandemic. The closure of churches is not something that any of us ever wants to see again. I hope that my hon. Friend’s constituents will follow the advice of the Archbishop of Canterbury: to come to church in person or virtually and to spend time with their wider families in a safe and responsible way.
Conor McGinn (St Helens North) (Lab)
Andrew Selous
The decision of a consistory court can, with permission, be appealed to the relevant provincial court, provided that the appeal does not relate to a question of doctrine, ritual or ceremonial. As in the temporal courts, an appeal must have a real prospect of success, or there should be some other compelling reason why the appeal should be heard.
Conor McGinn
I want to pay tribute to the family of Margaret Keane, whose grief at the loss of their mother has been compounded by still not having a headstone on her grave to visit this Christmas, two and a half years on from her death. The family have said that Margaret is “In our hearts forever”—“In ár gcroíthe go deo”—and that sentiment is shared now by the Irish community in Britain. May I ask the commissioner—I thank him and the Church for their engagement with me and the work they do in Saint Helens in the diocese of Liverpool—if a review can take place into the current appeals system in ecclesiastical courts, whereby even successful appellants are liable potentially for huge court costs to an unlimited amount? This is an access to justice issue and one of fairness that should be looked at.
Andrew Selous
I am sure that the whole House would want to extend their sympathies to the Keane family, and I am hopeful that change is on the way. The Church of England (Miscellaneous Provisions) Measure 2020, which was recently passed by this House, provides for exemptions from and reductions in court fees in the ecclesiastical courts to be made in secondary legislation. The Fees Advisory Commission will be asked to consider these provisions and, following that, an Order in General Synod will be made next year and will be laid before Parliament.
Karl MᶜCartney (Lincoln) (Con)
Andrew Selous
The Church has provided £35 million of sustainability funding to help dioceses that have been the hardest hit financially as a result of the pandemic. This is focused on dioceses in lower income areas and with fewer historic resources. Advice has been given on encouraging joyful giving and tithing as the cornerstone of parish finances, both by direct debit and card readers, as well as traditional giving in the plate.
Karl MᶜCartney [V]
Good morning, Mr Speaker, and I look forward to seeing you later.
I thank my hon. Friend for his response on behalf of the Church Commissioners—[Inaudible]—it is pleasing to hear. We look forward to a quick return to daily and weekly services for primary worship as soon as we are able, but also to the collections taken at these services along with the extra-curricular activities in the annual calendar of parish churches to fundraise and generate income for churches and their parishioners, which we hope can be reinstated as soon as is practicable, too.
Andrew Selous
Public worship can start again from next Wednesday, but it may take a while for church hall income, fundraising events and visitor income to pick up. Twelve churches in the Lincoln diocese have received £1.8 million from the Government’s culture recovery fund, and Lincoln cathedral has received £1.2 million from that fund.
Sir David Amess (Southend West) (Con)
Andrew Selous
As the Archbishop of York has pointed out, the Church has been “astonishingly present” throughout the pandemic, with over 35,000 active community projects. The GRA:CE Project report by Theos and the Church Urban Fund documents the enormous range and depth of this involvement, and the National Churches Trust’s “The House of Good” report recently estimated that parishes contribute around £12.4 billion of social good to the English economy.
Sir David Amess
I know that my hon. Friend would agree with me that at this particular time our churches are more important than ever. Certainly in my constituency, they do remarkable work—for instance, with the Southend night shelters—and during the coronavirus pandemic, they have been delivering food and medicines to vulnerable people. Will my hon. Friend please tell the House what the Church is doing to thank local churches and to celebrate their work?
Andrew Selous
I thank my hon. Friend for his question, and he is absolutely right that we all owe a huge debt of gratitude to clergy and parish workers, who have worked extraordinarily hard throughout the pandemic. In Southend West, for example, at Saint Saviour’s Westcliff, the congregation host a food bank and are collecting prescriptions and delivering food to those who are unable to leave their homes in my hon. Friend’s constituency. The Church of England is encouraging all congregations to continue with this kind of neighbourliness over the Christmas period to support vulnerable and lonely people.
Rehman Chishti (Gillingham and Rainham) (Con)
Andrew Selous
I would like to thank my hon. Friend for the enormous dedication and energy he put into this issue as the Prime Minister’s special envoy for religious freedom. The Church of England continues to press for the implementation of all the Truro report recommendations and challenges Governments and other faith leaders around the world who do not respect freedom of religion or belief.
Rehman Chishti [V]
I thank my hon. Friend for his kind words. Recently around the world, including in Nice and Vienna, evil acts have been committed in the name of religion. Pope Francis said in 2018:
“Every religious leader is called to unmask any attempt to manipulate God for ends that have nothing to do with him or his glory.”
The Archbishop of Canterbury expressed similar views in 2016 on tackling extremism through theological dialogue. Can my hon. Friend confirm what steps are being taken by the Church to work with other faith leaders around the world to further address the issue of persecutions of Christians, who are the largest persecuted faith in the world, and to address the issue of other individuals of all faiths being persecuted for their faith through theological and inter-faith dialogue?
Andrew Selous
My hon. Friend will know that there is a debate later today on this very subject, and he is absolutely right about the importance of inter-faith dialogue, which is why three years ago the Anglican primates launched an inter-faith commission to build mutual understanding and trust between different faiths. The Archbishop of Canterbury, who has a particular heart for reconciliation, said it
“will bring together the wisest people across the Communion to work on this area in the places of highest tension with the aim of replacing diversity in conflict with diversity in collaboration.”
Michael Fabricant (Lichfield) (Con)
Andrew Selous
The Church Commissioners have regular discussions with the Association of English Cathedrals, and cathedrals have made huge efforts to reach out to people in their areas. Lichfield cathedral, which I know is close to my hon. Friend’s heart—I think that he lives within its shadow—will be having an illuminations show and will hold as many services as possible, including some outside if necessary.
Mr Speaker
Let us go to the shadows of Litchfield cathedral, with Michael Fabricant.
Michael Fabricant [V]
Thank you, Mr Speaker; I am indeed very close to Lichfield cathedral, and the dean of Lichfield cathedral is the chairman of the Association of English Cathedrals. We are all delighted that we are going to have services this year and he has sent me a question, and I am going to read it, because he only lives a few doors down, and I have given my hon. Friend prior notice of the question. The dean asks, “What additional support can be given to cathedrals in the first quarter of 2021 to ensure they remain open and responsive to public need?”
Andrew Selous
I thank my hon. Friend for his question, and I will be leaving these questions to go into a governors meeting of the Church Commissioners, so I will pass that on very directly. I can tell him that Lichfield cathedral has received £140,000 from the national lottery heritage emergency fund, but I know it needs extra funding for urgent building projects, including a buttress that is causing structural concern. I can also tell him that conversations with the Department for Digital, Culture, Media and Sport and the Treasury about the Government’s own Taylor review of church and cathedral building sustainability are ongoing.
Ruth Jones (Newport West) (Lab)
Andrew Selous
The “Living in Love and Faith” report is a teaching and learning resource for the Church on marriage, sexuality and relationships. We hope it will enable parishes to learn together over the next year as we engage graciously, respectfully and compassionately with each other.
Ruth Jones
Does the hon. Gentleman agree that equality cannot just be about words, but also needs to be about actions, so what is actually being done to reach out to support LGBTQ+ members of the Church at a local level?
Andrew Selous
The Church recognises that we are all created in the image of God and should all be treated with dignity, which is why we have also created an anti-racism taskforce. With “Living in Love and Faith”, we will move towards a period of discernment and decision making in 2022, and we want to ensure that differences of view are expressed courteously and kindly—something we could do rather better on in this Chamber from time to time.
Fleur Anderson (Putney) (Lab)
Andrew Selous
The Anglican communion is supporting yesterday’s White Ribbon Day, the United Nations day for the eradication of all forms of violence against women and girls, with 16 days of online panel discussions and social media campaigns to spot and eradicate gender-based violence. The resources are available in seven languages in over 165 countries, and this is as essential for economic development as it is for the promotion of fundamental human dignity.
Fleur Anderson
I welcome the hon. Gentleman’s and Church Commissioners’ support for the International Day for the Elimination of Violence against Women. Sexual violence in conflict remains far too common a tactic of warfare. Can the Church Commissioners report on the steps being taken by the Anglican communion to stop the dreadful stigmatisation of survivors of sexual violence in conflict and the important role that the Church can play around the world?
Andrew Selous
The hon. Lady is absolutely right to raise this completely horrific practice. I can tell her that the Bishop of Gloucester has led discussions with Ministers about the role of faith communities, which are often the first point of call for people in need. Parishes are often willing to scale up support for people suffering from gender-based violence and domestic abuse. It is important that there is a level playing field for all providers of support and advice services, including church ones. That is what we are doing in the UK, but I take her point about the global nature of this issue and the important role that the Anglican communion has in engaging with it.
Mr Speaker
In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next, I am suspending the House for three minutes.
Business of the House
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Valerie Vaz (Walsall South) (Lab)
Will the Leader of the House please give us the forthcoming business?
The Leader of the House of Commons (Mr Jacob Rees-Mogg)
The business for the week commencing 30 November will include:
Monday 30 November—Second Reading of the Telecommunications (Security) Bill.
Tuesday 1 December—Motion to approve regulations related to public health.
Wednesday 2 December—If necessary, consideration of Lords amendments, followed by a motion to approve the draft Agriculture and Horticulture Development Board (Amendment) Order 2020, the draft Direct Payments to Farmers (England) (Amendment) Regulations 2020 and the draft World Trade Organisation Agreement on Agriculture (Domestic Support) Regulations 2020, followed by a motion to approve the draft Plant Health (Amendment etc.) (EU Exit) Regulations 2020 and the draft Plant Health (Phytosanitary Conditions) (Amendment) (EU Exit) Regulations 2020.
Thursday3 December—General debate on the future of coal in the United Kingdom, followed by debate on a motion relating to digital infrastructure, connectivity and accessibility. The subjects for these debates were determined by the Backbench Business Committee.
Friday 4 December—The House will not be sitting.
Valerie Vaz
May I thank the Leader of the House for the business and ask again about the end of Session? Obviously, that is not going to be in November. I can only assume it will be May, but it would be helpful to know, particularly as we would quite like another Opposition day. I think ours was taken away last time.
May I ask for a statement, again, on the progress of the EU talks from the Prime Minister? I think he has stopped shielding, or hiding from the ERG or CRG or whichever group we have now. We may be in lockdown, but we are not in a Government news lockdown.
The Department for International Development has been abolished and we know that it has gone into the Foreign, Commonwealth and Development Office. Could the Leader of the House set out what plans the Government have for re-establishing that Department in some form or another, or maybe keeping the Select Committee as it is, given that it needs to look at overseas development aid?
I hope that the Leader of the House will bring back the motion on virtual participation. We all want a much longer debate than we had on Tuesday. Let us remember: it is the Government who prevented participation of our colleagues, pitching one colleague against another through a restrictive and discriminatory definition. It is that stubbornness that is preventing our colleagues from taking part.
Let me quote something that I did not have time to quote on Tuesday. It states that
“the broadcasting hub on the Estate had been substantially improved and augmented”—
that means made better and bigger—
“with additional offsite capacity.”
The House staff think that this can be done. Why do the Government and the Leader of the House not think so?
Let us turn to the spending review. The Chancellor has made available £4 billion of a levelling-up fund. It is a bit like a gameshow now, pitching one community against another—“I’m a levelling-up project, gimme the money!” Last week, I raised the NAO report and the possible misuse of public money whereby one Minister gives money to another Minister in the constituency. I am sure the Leader of the House will know—I know the Government have issues with the Electoral Commission, an independent body—that the shadow Minister for voter engagement and young people, my hon. Friend the Member for Lancaster and Fleetwood (Cat Smith), has asked the Electoral Commission about the misuse of public funds in relation to ads in targeted seats just before the election, with majorities of fewer than 5,000. They were told, “You’re going to get £25 million of investment in your town.”
If this is going to continue, will the Leader of the House ensure that proper criteria are published? We need to know which Department will be responsible for it, because there are three involved—the Treasury, Transport, and Housing, Communities and Local Government. Better still, why do the Government not just give the money to the local authorities on proper criteria, as they have done for years? Those authorities are all in deficit; they have all been struggling. Even better, give the money to key workers. Public sector workers have had a slap in the face in not getting an increase in their salaries, which is just levelling up after 10 years of Tory austerity.
Under the spending review, the Chancellor has set out funds to support getting people back to work—the Restart scheme. On Tuesday, there was a joint press release with Ministers and Scottish Ministers saying that a really important company, Burntisland, is going to lose highly skilled, specialist jobs that are here in Scotland. Hundreds of employees do not know whether they have a job or not. Could we have an urgent statement from the Secretary of State for Business, Energy and Industrial Strategy to continue these discussions, so that we do not lose those vital jobs?
This is not a party of law and order; this is not a Government of law and order. On Tuesday, the Secretary of State for Education was found to have acted unlawfully in watering down safeguards for protecting children. He excluded the Children’s Commissioner, among others, from his decision making, and 65 separate legal protections were watered down. Can we have an urgent statement?
The Equality and Human Rights Commission found on Wednesday that the hostile environment referred to by the shadow Lord Chancellor breached equalities law. What about the Secretary of State giving a job to his friend, who was first unpaid—an unpaid lobbyist—then became a non-exec director, paid with public money, and then received an access all area pass from another Minister? Could we have an urgent statement? I know the Leader of the House does not like to have people who are overqualified for jobs if they have been members of the Labour party, but having someone who is a friend, who does not go through normal employment practices, is not right.
Parliament Week has been a great success. David Clark and the team have undertaken 8,700 activities and reached over 980,000 people. All of them have done a fantastic job explaining our democracy. On behalf of everyone, I thank David Clark and wish him well in his new post. I understand that he is popping up in an office near you, Mr Speaker—literally near you.
Kylie has been released. Daren Nair of Amnesty International thanked the Australian Parliament and our Parliament for making sure that Kylie’s name was never forgotten, and we want to do the same for Nazanin, Anoosheh, and of course Luke Symons. We want them home before Christmas.
Finally, we remember Bruce Boynton of Boynton v. Virginia, one of the first Freedom Riders. May he rest in peace.
Mr Rees-Mogg
Indeed, may he and all the souls of the faithful departed—especially in November, of course, the month of the holy souls—rest in peace.
I share her agreement that we should congratulate David Clark on what he has done for Parliament Week. May I say that the thanks being given to the British Parliament for Kylie’s release should fall particularly to the right hon. Lady? It is not usual for the Leader of the House to say that his shadow is the person who has really highlighted a cause, fought for it and raised it week after week, but I think the thanks should go much more to her than to me. I hope she will continue to raise these issues, because I think it is an area in which the whole House is in agreement.
However, I am sorry to tell you, Mr Speaker, that we do not agree about everything. The end of the Session will of course come in accordance with the process of successive Government business, in the normal way, and will be announced in the normal way. We will have Opposition days in accordance with the requirements of Standing Orders—I know that everyone waits with bated breath for future Opposition days.
As regards EU talks and when statements will come, I think we will see from what comes after me how good and strong the Government have been in keeping this House up to date, with two important statements coming. I can reassure the House that statements will come when there is something to say, but it is not beneficial for the House to have statements until that time.
The right hon. Lady asked about DFID and the processes with the Select Committee. This is under discussion between the Chairman of the Select Committee and other interested parties, and the Government are looking upon suggestions about it with benignity.
On virtual participation, the right hon. Lady puts herself forward as Gladstone. Mr Gladstone used to think that speaking for four hours was a mere bagatelle; he had hardly cleared his throat in the first four hours. The right hon. Lady spoke for over an hour on Tuesday—with great distinction and panache, it has to be said, and a great deal of support from her right hon. and hon. Friends. I fail to see how sufficient time was not provided when another hon. Member managed to talk out his own amendment, which is Gladstonian in a different way; a way that Disraeli might have noted and commented upon.
It is a great shame that that debate was not allowed to come to a conclusion. The reason it did not was that Opposition Members—the Labour party and the Scottish National party—decided that it should not. It is unusual for an hon. Member to talk out his own amendment. Some may even consider it eccentric, and it is a pity because we had hoped that we could ensure participation for the extremely clinically vulnerable. There was an amendment tabled that would have broadened it, but the House was not allowed the opportunity to express its will by the actions of Opposition Members. That was a choice that they made, rather than allowing a vote in this House that would have settled the issue. It is to my mind a great shame that that is the situation we find ourselves in.
As regards the levelling-up fund, I would have thought that the right hon. Lady would welcome £4 billion to help places that have been left behind to improve, to increase opportunity and prosperity across the country, and to ensure that the House is properly involved so that it is a national programme helping locally. It is a really admirable programme and has widespread support, as does the towns fund. It is really important to understand that Ministers should neither be advantaged nor disadvantaged by the fact that they are Ministers, so the fund was completely properly allocated, and it is right that that should happen to help town centres do better in what are extremely difficult circumstances.
As regards the hostile environment, I was, I am glad to say, on the Back Benches when that was Government policy: it is not Government policy and the hostile environment is not something I have ever been comfortable with. I think someone is either a British citizen or they are not, and if someone is a British citizen they have exact equality and parity with all other British citizens and should not be asked, even in this House, to prove their identity.
Dr Kieran Mullan (Crewe and Nantwich) (Con)
I am sure that Members across the House have been approached, as I have, by local NHS leaders who are looking for venues that they can use to carry out what will be the Herculean effort of vaccinating our population, should a vaccine be approved. Will the Leader of the House encourage businesses and property owners in constituencies across the country to step forward and make venues available where they can to help in that national effort?
Mr Rees-Mogg
My hon. Friend is absolutely right. Throughout the pandemic, one of the most heartening signs was the huge national effort by so many people across the country to rise to the challenge. The NHS does have a tried and tested track record for delivering vaccination programmes and will work with existing partners across the healthcare system to ensure a covid-19 vaccine can be deployed both safely and effectively. Detailed planning is under way, building on the NHS’s expertise in delivering immunisation programmes, and that includes consideration of the settings required to vaccinate the public against covid-19. We are grateful for the support that businesses have offered. My hon. Friend cites Hercules, and this will be one of the 12 labours of Hercules as it is rolled out.
Tommy Sheppard (Edinburgh East) (SNP) [V]
I ask again: can we have a proper debate in which Members discuss and decide, on a free vote, the nature and extent of virtual participation in the proceedings of this Parliament while the pandemic lasts? The procedural shenanigans displayed by the Government on Tuesday, when they engineered call lists to conjure up a debate where none had been planned, were an affront to democracy. The attempts by the Leader of the House to suggest that those of us who argue for every Member to have the right to remote participation were in fact trying to deny that right to colleagues who are clinically vulnerable is offensive. I say to him in all sincerity that he is in grave danger of losing the confidence of the House, which he needs to perform his constitutional role. I hope that, rather than a glib response or a puerile putdown, he will demonstrate thoughtfulness and leadership, and allow elected Members to decide this matter.
The Leader of the House has made much of the need for democratic debate and scrutiny to continue, but yesterday the biggest change in public policy in a decade was announced in the spending review, with no opportunity to debate, amend or agree. We must debate public sector pay if the Government intend to cut the wages of those key workers they applauded from the steps of Downing Street. We must debate overseas aid if the Government are to slash support for the world’s poor, severely damaging the UK’s global reputation in a manner that would make Trump proud. These are not manifesto promises. The Government have no mandate for them, and they ought not to become the policy of the land without a vote in Parliament.
Finally, I come to the tragedy of Brexit—just five weeks to go and no deal in sight. Last week, I got no answer about the shared prosperity fund. Today, I want to ask for a debate on plugging the £170 million black hole left in Scotland’s rural economy as payments under the LEADER scheme end following withdrawal from the common agricultural policy. The silence on this is reckless and damaging to Scotland’s rural economy.
Mr Rees-Mogg
To misquote P.G. Wodehouse, it is never difficult to tell the difference between a member of the SNP with a grievance and a ray of sunshine. It seems to me that the cloud across any ray of sunshine can always be provided by the hon. Gentleman. What does he say to us today? He says that a debate of over two hours is undemocratic. It was undemocratic to have a debate—that, I think, is an unusual view to hold—and then he thinks that a democratic vote, of 52% of the people of the United Kingdom to leave the European Union, is a disaster. He seems only to like the votes that he wins, but the SNP, fortunately, does not win votes across the United Kingdom at large and lost a very important vote in 2014.
Why I think the hon. Gentleman should be a ray of sunshine is that he should be asking for a debate on the £2.4 billion extra announced in the spending review yesterday that is going to Scotland. He should be celebrating the fact that £1,633 extra is attributed to public spending per capita in Scotland against the United Kingdom average, and he should celebrate the fact that £8.2 billion of UK taxpayer money has gone to Scotland to help it fight the coronavirus. The evidence is that the United Kingdom is extraordinarily strong as a single United Kingdom, with taxpayers coming together to help one another.
I notice that the hon. Gentleman carefully avoided the fact, when he talked about the House’s confidence, that in Scotland, confidence may be ebbing away. I noticed that the SNP lost a vote in the Scottish Parliament yesterday over publishing the legal advice given to the Scottish Government on the judicial review brought by Alex Salmond. They were very happy to vote for the Attorney General to release his advice here under an Humble Address—sauce for the goose, sauce for the gander, or are they just turkeys waiting for Christmas?
Paul Holmes (Eastleigh) (Con)
The week before lockdown, I had the privilege of meeting Sam Edwards and David Bruce, two serving Royal Marines, and Junior McIlhiney and Will Schweppe, two marine veterans. They were training in my constituency, in Hamble, to row the Atlantic unaided next week in aid of the Royal Marines Charity as part of the Cockleshell Endeavour. Will the Leader of the House join me in wishing them well in their endeavours next week and encourage people to donate to their worthwhile campaign? Can we have a debate on services for veterans, where we still need to make much more progress?
Mr Rees-Mogg
May I indeed wish them well in the work they are doing to raise funds for the Royal Marines benevolent fund? I think it is a terrific effort. Do we not all admire the Royal Marines this country, I perhaps most particularly, because my campaign manager in every election since 2010 has been a former Royal Marine? I know what fine members of the community they remain, even when they have left military service.
Veterans’ mental health is of great importance and the Veterans’ Mental Health Transition, Intervention and Liaison Service is for serving personnel approaching discharge from the military, reservists and veterans with mental health difficulties. The veterans’ mental health complex treatment service provides intensive care and treatment that may include support for drug and alcohol misuse, physical health, employment, housing, relationships and finances, as well as occupational and trauma focus therapies. It is very important that this is supported. It had £16 million of spending last year and over 10,000 referrals up to the end of 2019, but my hon. Friend is right to raise this important issue.
Mr Speaker
It is important that the whole House supports the Royal Marines and their endeavours to raise money, not least for one of the most courageous events of the second world war, the Cockleshell heroes.
Ian Mearns (Gateshead) (Lab) [V]
I thank the Leader of the House for his statement and also for writing to the Secretary of State for Housing, Communities and Local Government Secretary of State on my behalf and on behalf of my constituents following last week’s exchanges. I also thank him for announcing the Backbench Business for next Thursday, the first item of which will be a debate promoted by the hon. Member for North West Durham (Mr Holden) on the future of coal in the United Kingdom, and the second of which is promoted by the right hon. Member for Tatton (Esther McVey) and my hon. Friend the Member for Sunderland Central (Julie Elliott) on digital infrastructure connectivity and accessibility.
Can we have an urgent statement from the Secretary of State for Business, Energy and Industrial Strategy on the offshoring of British jobs by companies that this Government have supported through the pandemic? In particularly, as an example, I am thinking of Rolls-Royce transferring jobs overseas from its aero-engine plant in Lancashire.
Mr Rees-Mogg
First, I am grateful to the hon. Gentleman for his kind words. May I just add a point on correspondence? I have made it very clear in this House that I will do everything I can to help Members get replies from Ministers, whether to written questions or to letters or emails that are sent in. It may be worth reminding Members of the courtesy the other way round: it is customary for Members to sign letters to Ministers themselves, not to get them sent by their members of staff. Members cannot expect ministerial responses to letters that are not sent by them personally. In my role as both representing the House to the Government and the Government to the House, I hope that both sides of that will be followed through.
As regards a statement by the Secretary of State for Business, Energy and Industrial Strategy, the hon. Gentleman raises an issue that is obviously important—if the Government are supporting businesses, one would expect them to be very committed to being active in this country, rather than taking jobs overseas—and I will raise it on his behalf with my right hon. Friend.
Sir David Amess (Southend West) (Con)
Will my right hon. Friend find time for a debate on the future management of c2c rail services in my constituency? The service used to be known as the “misery line”. It then became the “happy line”, but unfortunately it now become the misery line again, because, inexplicably, timetable changes have been made, with trains cancelled, but the trains and platforms are overcrowded. That is totally unacceptable during this coronavirus pandemic.
Mr Rees-Mogg
We always want happiness rather than misery, so I am grateful to my hon. Friend for raising this issue. I note the c2c has announced recently that it is
“introducing a more sustainable and resilient timetable, which should result in fewer short-notice cancellations.”
That sounds like one of those pieces of verbiage we sometimes get from bureaucracies, but we await this with interest and I am sure my hon. Friend will remind the House if it is not delivered upon. In the meantime, I will raise his point with my right hon. Friend the Secretary of State for Transport.
Bill Esterson (Sefton Central) (Lab)
Yesterday, the Chancellor told me that the Government grants to councils to use to support their local economies could be used “as they see fit”, but that was not true, because many freelancers and self-employed people do not qualify for schemes such as the one announced by the Liverpool City Region Mayor, Steve Rotheram. These people do not qualify for the national schemes, they do not qualify for the local schemes and they do not quality for universal credit either. So will the Leader of the House confirm that the Chancellor was wrong yesterday? Will the Leader of the House admit that it is time the Government stepped up and dealt with the burning injustice facing so many of our working people who have been left behind in this crisis?
Mr Rees-Mogg
I think this has to be put in the context of the overall support provided by the Government, with the amount of money now running into the hundreds of billions of pounds. Specifically for councils, £4.6 billion of unring-fenced support for councils has been paid, and there has been £1.1 billion to support local businesses and £10 billion in business rates relief. I absolutely accept that not everybody is able to get all the support that is available and that is a fair point for the hon. Gentleman to make, but the Chancellor is absolutely right to say that there is £4.6 billion of additional unring-fenced funding for councils.
Sir Robert Syms (Poole) (Con)
May I ask for a debate on residential landlords in the private rented sector, as the sector is very unhappy? It provides valuable property for people, yet throughout this crisis landlords have been prevented from managing their properties and evicting people, even those with arrears from well before the crisis. I know of landlords who have not been able to evict people exhibiting antisocial behaviour and causing distress to other tenants because of restrictions the Government have imposed. Some people who could pay rent are not paying rent, but some of the residential landlords are still having to pay mortgages. This is a troubled sector and we should explore all the issues and have a full debate.
Mr Rees-Mogg
I am not unsympathetic to what my hon. Friend is saying. The package of Government covid measures in the private rented sector seeks to strike the right balance between prioritising public health and supporting the most vulnerable renters, while ensuring that landlords can get access, and exercise their rights, to justice. The stay on possession proceedings was lifted on 21 September, and landlords can now take action on possession claims through the courts. Although we have laid regulations to require bailiffs not to enforce evictions until 11 January, there are exemptions—this is important—for the most serious cases, such as antisocial behaviour and illegal occupation.
We are grateful to landlords for their forbearance during this unprecedented time. Some may have been able to benefit from postponements of mortgage payments, which have been made available, but we strongly encourage tenants in all relevant Government guidance to pay their rent or to have an early conversation with their landlord if they have any difficulty doing so. The mortgage holiday has been extended, with the application process open to 31 January 2021.
Wera Hobhouse (Bath) (LD)
Carers across the UK do a remarkable and difficult job on a daily basis. Some 900,000 full-time unpaid carers rely on carer’s allowance, but at just £67.25 per week it is not nearly enough, and many families face severe hardship. Today, on Carers Rights Day, the Liberal Democrats have launched their Stand up for Carers campaign, calling for the allowance to be raised by £20, in line with universal credit. Can we have a debate on the challenges that unpaid carers face, recognising the amazing jobs they do and looking at what more the Government can do to support our wonderful carers across the country?
Mr Rees-Mogg
I am very grateful to the hon. Lady, my neighbour, for raising that point and for allowing us to pay tribute to carers on Carers Rights Day. It is a remarkably selfless thing that they do; it is incredibly difficult and hard work, and sometimes—particularly during lockdown—it has been very lonely work for carers who are members of the family and who are doing it out of love, rather than because they are employed. I am therefore grateful to her for the tribute that she pays to carers.
In terms of finding extra funding, I am sure the hon. Lady listened to the Chancellor’s statement yesterday. The public finances are not in a situation, I fear, where it is possible to find additional funding for things that it would be very nice to do if we were in a different financial situation.
Imran Ahmad Khan (Wakefield) (Con)
My mother bids me to wish you a good morning, Mr Speaker. When will my right hon. Friend the Leader of the House find time for a debate with the purpose of examining, and an eye to correcting, the constitutional vandalism inflicted upon this country by the Labour Government of 1997 to 2010 regarding the roles and scope of the Supreme Court and the Lord Chancellor?
Mr Rees-Mogg
May I send my felicitations to my hon. Friend’s distinguished mother? I appreciate her message. I also appreciate my hon. Friend’s point, because the last Labour Government decided to take a wrecking ball to our constitution and made a bit of a muddle with it. Some of their most foolish interventions were their constitutional blunders, which were out of step with many centuries of our parliamentary democracy. Blairite constitutional tinkering has weakened our Parliament and has helped to divide the United Kingdom, and I hope that this Government find an effective way of restoring our constitution to its proper form.
Stephanie Peacock (Barnsley East) (Lab)
My constituent Paul Goose, a former member of the 1st Battalion of the Light Infantry, has played the last post on his doorstep since the first UK lockdown began. In doing so, he has raised £10,000 for Barnsley Hospital’s intensive care unit. Will the Leader of the House join me in congratulating and thanking him for his efforts and in calling on “The Guinness Book of Records” to consider recognising his achievement?
Mr Rees-Mogg
What a wonderful tale the hon. Lady has brought to the House. Ten thousand pounds raised for the Barnsley ICU is a terrific achievement. I hope “The Guinness Book of Records” will recognise her constituent for playing the last post every day. It is always such a moving tune, and hearing it must be very important for the residents nearby and a pleasure for them, so I absolutely congratulate her constituent. I have no influence with the editors of “The Guinness Book of Records”, but I hope they will hear her plea.
Ben Bradley (Mansfield) (Con) [V]
All the polling out there suggests that the vast majority of the British public will welcome plans to divert foreign aid spending into UK priorities at this difficult time, when we know there is lots of support needed here at home. Turning the £4 billion sent abroad into a £4 billion levelling-up fund for our most disadvantaged communities is the right move—in fact, it is long overdue. Will my right hon. Friend make time available for us to discuss this funding and where and how it might best be used, and can I be the first to say to him and the Government that we will have some of it up in Mansfield, please?
Mr Rees-Mogg
My hon. Friend’s plea is noted, and I absolutely agree with him. I think that people will very much welcome the announcement made by the Government yesterday—other, possibly, than a few Islingtonians. The Government take their responsibility for the people of the north and the midlands very seriously, millions of whom placed their trust in the Conservatives for the first time last December. My right hon. Friend the Chancellor announced in the spending review yesterday that the Government are launching a new levelling up fund worth £4 billion in England, which will attract £800 million in the usual way through the Barnett formula for Scotland, Wales and Northern Ireland. Our new fund will build infrastructure for everyday life, such as new bypasses, upgraded railway stations and better high streets and town centres. The Chancellor answered lots of questions on this yesterday, and it is important that this subject is properly scrutinised.
Vicky Foxcroft (Lewisham, Deptford) (Lab) [V]
On Wednesday 2 December, the Government plan to deport dozens of people, including one of my constituents, to Jamaica. He has lived in the UK since childhood and is being denied the chance to see his loved ones before being placed on that flight. Not only should this not be happening, but how can this level of cruelty take place? Can we please have an urgent debate on this terrifying situation?
Mr Rees-Mogg
It would be wrong of me to comment on an individual case when I obviously do not know the details. This is a matter for the Home Secretary, and I am sure that the hon. Lady has used the usual means to raise her point with the Home Secretary. We have a very fair immigration system that tries to ensure that the people who are entitled to be here are here, and that those who are not entitled to be here have to go back to the places from which they came. That is a perfectly reasonable immigration policy, but individual cases can sometimes be much harder than the broad principles.
Mr John Baron (Basildon and Billericay) (Con) [V]
The whole House knows that the Leader of the House is a thoroughly decent chap, but, like all of us, he has the occasional blind spot. I have more than my fair share. His, though, relates to forbidding those colleagues with proxy votes who are not clinically extremely vulnerable from participating virtually in debates. May I suggest that he reconsiders and allows a proper debate and vote on the issue? The technology works, and the Government advice is that people should work from home when they are able to do so. There really should not be two classes of MP. All MPs should be able to represent their constituents in debate.
Mr Rees-Mogg
My hon. Friend raises the point about proxy votes. Proxy votes are available to all Members and were widened to reduce the numbers going through the Division Lobbies, and this does not have any effect on people’s ability to appear in debates, or indeed for them to appear virtually in interrogative sessions. I would point out to my hon. Friend that, had he not tabled his amendment earlier this week, we would have extended this to the extremely clinically vulnerable for debates, and I am sorry that that did not happen.
Debbie Abrahams (Oldham East and Saddleworth) (Lab) [V]
Yesterday was the International Day for the Elimination of Violence against Women. In the UK, two women a week will die at the hands of their partner or ex-partner, and unfortunately the pandemic has made this worse. I welcome the Government’s announcement of £125 million to go to local authorities for accommodation for women fleeing abuse, but this falls well short of the £2.3 billion that the sector has calculated that they need, so can we have a debate on how we can better support the women and children affected by this abuse, and about how we can prevent the abuse in the first place?
Mr Rees-Mogg
It is sometimes in the ability of the Leader of the House to grant something almost immediately, although by serendipity rather than by any action of my own, because there is a debate in Westminster Hall today in recognition of yesterday being the International Day for the Elimination of Violence against Women, which will be an opportunity to raise those issues. I would also point out that the Domestic Abuse Bill is in the House of Lords. This is an important contribution to reducing domestic violence, and I think the whole House, and certainly the Government, takes this issue extremely seriously.
Mr Peter Bone (Wellingborough) (Con) [V]
Two days ago, the Government tried to bounce the House of Commons into agreeing to their position on how hon. Members scrutinise the Government during debate. They deliberately pulled three items at the last minute to bring forward a motion that no one expected to be debated. There were no call lists and there was no advance knowledge for Members.
What is more, had there been a vote, the Deputy Chief Whip on the Government side would have cast hundreds of proxy votes in support of the Government motion in what was clearly a free vote, and many of those Members would not even have known that the vote was taking place. It was definitely a farce and probably a contempt of Parliament. Could the Leader of the House explain why on earth next week we do not have a proper scheduled debate on virtual participation?
Mr Rees-Mogg
My hon. Friend is a very experienced parliamentarian and knows the Order Paper very well. If he looked at the Order Paper on Tuesday and at the debates on offer, it was extremely likely that we would get, under all normal circumstances, to the debate on virtual appearances in debates. My expectation was that we would have had between three quarters of an hour and an hour for it, had the previous debates gone in the normally expected way.
For reasons best known to themselves, the Opposition decided to spend the full 90 minutes—which they are entitled to do—on the statutory instrument that came earlier in the day. Because we had been asked for a debate, we decided that it was sensible to allow full time for the debate on virtual appearances. Therefore, we moved the remaining business from Tuesday to Wednesday, so that it could be completed. It is not unusual for debates to be changed or motions to be pulled.
The Opposition, joined by the SNP, then decided not to allow this to go to a vote by the House, nor indeed to have the amendment which they supported put to a vote. So if anyone was playing ducks and drakes with parliamentary procedures, it was the Opposition.
Tonia Antoniazzi (Gower) (Lab) [V]
I want to take this opportunity to raise with and update the Leader of the House on the “DIY SOS” build we had for the wonderful Surfability, a community interest company at Caswell bay, Gower, and the new building for its users. The generosity of people across the UK in these difficult times has really shone through. Will he join me in highlighting Surfability and call on potential donors and benefactors to take a look at its brilliant work to support its inclusive ethos that everyone should experience the joy of surfing?
Mr Rees-Mogg
As long as I do not have to enjoy the joy of surfing, very much so. I do not think that it is an act I will be joining in with, but I thank the hon. Lady. It is so important that she brings to the House’s attention organisations such as Surfability and their good work. She is also right to praise the generosity of people across the whole of the United Kingdom, but also of course in her constituency of Gower, in these difficult times. I wish Surfability every success and hope that the publicity it will get from the many millions who watch the Parliament channel will lead to it receiving more donations.
Mary Robinson (Cheadle) (Con) [V]
High coronavirus transmission rates across Greater Manchester have impacted on schools and on students’ education. Schools such as the Kingsway, Bramhall High, Hazel Grove and Cheadle Hulme High are trying to prepare year 11 pupils for next year’s exams or assessments, but covid has meant that many pupils have had fewer than 30 days in school since September. Does my right hon. Friend agree that covid-19 must not entrench educational disadvantage, and will he allow a debate in Government time to address the regional impact of coronavirus on education?
Mr Rees-Mogg
First, yes, of course the coronavirus must not entrench disadvantage and that is why there is a £1 billion fund to help education to recover from this period, £350 million of which is allocated for the most disadvantaged to have special tutoring. We know that examinations and assessments are the best and fairest way of judging students’ performance, and the Secretary of State for Education has confirmed that next year’s GCSE, AS-level and A-level examination series will go ahead, but it is a priority to ensure that there is a consistent approach to what is taught and what will be assessed across schools. The Government are working with Ofqual and engaging widely with the education sector to identify any risks to examinations at a national, local and individual student level, and to consider measures needed to address any potential disruption.
Gavin Newlands (Paisley and Renfrewshire North) (SNP) [V]
Yesterday’s spending review was disappointing for many, including public sector workers and the Scottish Government, whose capital budget was cut while other such budgets were increased elsewhere. It was also yet another fiscal event without any help for the Women Against State Pension Inequality. Although there is not much hope that this Government will do the right thing, there remains hope that the parliamentary ombudsman’s investigation into the issue will bear fruit. My constituent is one of the test cases, but they have been delayed again and again by the Department for Work and Pensions. Will the Leader of the House please speak to his Cabinet colleague from the DWP to grease the skids and allow the ombudsman to do their work?
Mr Rees-Mogg
I remind the hon. Gentleman that yesterday’s announcement meant an extra £2.4 billion of funding for Scotland and shows the strength of the United Kingdom and its ability, as a United Kingdom, to weather these extraordinary economic conditions. As regards the WASPI women, although there was a lot of sympathy with them in this House, the Court found that what was done was done properly and that it is fair to have unified the retirement age among men and women.
Huw Merriman (Bexhill and Battle) (Con)
Would it be possible for us to have an urgent debate on the manner in which the Department of Health and Social Care is determining which tiers apply for local coronavirus restrictions? We are told by the Department that our local health and local authority leaders have been consulted and have given their views on local data and trends, but the consultations that I have had with my local leaders in East Sussex reveal that not to be the case, which is a worry. My right hon. Friend was always a doughty defender of transparency when he spoke from the Back Benches; will he ensure that we get the same from Government Departments?
Mr Rees-Mogg
My hon. Friend undoubtedly raises an important point. It is vital that the Government make and implement all their coronavirus measures with public consent. Indeed, one of the remarkable things has been the extent to which the British people have voluntarily accepted the restraints and have not found it necessary to have them onerously imposed upon them. We will debate the statutory instruments next week, as I announced in my statement, and my right hon. Friend the Secretary of State for Health and Social Care will be making a statement shortly. It is important to have the right balance between acting quickly and decisively while managing also to consult the necessary bodies.
Carla Lockhart (Upper Bann) (DUP) [V]
The Leader of the House will, I am sure, share my opposition to and abhorrence of the glorification of terrorism in our society. Sadly, in Northern Ireland this happens on a daily basis. Indeed, the hon. Member for South Down (Chris Hazzard) has a constituency office named after two members of the Provisional IRA. Mr Sammy Heenan, a South Down constituent, was 12 when he watched as his father died outside their family home near Castlewellan following an IRA attack. He has described the signage as “repugnant”, “obscene” and “deeply, deeply offensive”. Will the Leader of the House agree that it would send a strong message to victims of terror in Northern Ireland and, indeed, across this United Kingdom, if the House took a stand against MPs who glorify terrorists? Does he agree that a debate to allow Members to express their opposition to the glorification of terrorism would send a strong message to constituents that it is wrong and that we stand united against it?
Mr Rees-Mogg
The hon. Lady raises a point of fundamental importance. In this Chamber we have the shields of people such as Airey Neave and Ian Gow who were murdered by terrorists. We should remember and commemorate those who were killed and honour their memory; we should not honour and commemorate murders—people who are wicked and evil and deserve condemnation, not commemoration.
Karl MᶜCartney (Lincoln) (Con) [V]
First, I congratulate my right hon. Friend on making many of us on the Conservative side of the House happy with his responses to the earlier question from the Scottish Member, the hon. Member for Paisley and Renfrewshire North (Gavin Newlands), who was certainly not very happy.
Many Members, like my right hon. Friend and me, will have received a vast amount of correspondence from those who are part of the ExcludedUK campaign group. Certainly in Lincoln’s case, these individuals are good people who have fallen through the cracks of Government support this year, so will my right hon. Friend make Government time available, perhaps with our right hon. Friend the Chancellor, to debate their situation and this critical issue?
Mr Rees-Mogg
My hon. Friend raises a point also raised by an hon. Gentleman on the Opposition Benches, and it is something that the House is concerned about. Throughout the crisis, the Government have made huge efforts to support the economy’s structures and maintain as many people’s livelihoods as possible in an exceptional crisis. There has been unprecedented support offered to businesses, the employed, the self-employed and the unemployed through the benefits system. Throughout this crisis, the Government have sought to protect people’s jobs and livelihoods and support businesses and public services across the United Kingdom. The Government have spent over £280 billion of taxpayers’ money to do so this year. Our package will remain the same as we move out of the national lockdown and into a tiering system, and we will continue to provide a comprehensive economic support package to support jobs and businesses. We have prioritised helping the greatest number of people as quickly as possible, but I do accept that there are some businesses that have not benefited and that is an exceptional difficulty for them.
Nick Smith (Blaenau Gwent) (Lab)
I have asked a number of times, both in the Chamber and in letters, if the Government will amend bereavement support legislation to cover cohabitees with children. This is an important issue to help families to get through the worst of times. I am glad to say that it has been confirmed that a remedial order will be brought forward to do this, so will the Leader of the House please tell me when we can expect to see that order, which has been long awaited by many families?
Mr Rees-Mogg
May I congratulate the hon. Gentleman on this campaign? It shows the House at its best when these issues that are very important for individual families are taken up by an individual MP and the Government then move to put things right. I do not have a specific date for him at the moment, but as soon as I do, I will notify him.
Fiona Bruce (Congleton) (Con)
The kickstart scheme is an excellent Government proposal. Cheshire Learning Partnership, with the support of the East Cheshire chamber of commerce, both of which are based in my constituency, is keen to become a gateway into the kickstart scheme, having 40 local employers offering over 100 immediately available work placements for young people. Will the Leader of the House please press this with his ministerial colleagues at the DWP to ensure that it can be facilitated as quickly as possible?
Mr Rees-Mogg
I first congratulate my hon. Friend on all she is doing to help the kickstart scheme, and the East Cheshire chamber of commerce on its enthusiasm, but the answer to her question is yes.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind) [V]
Yesterday the Chancellor failed to clarify whether the emergency weekly uplift of £20 on universal credit would continue past March. As the Resolution Foundation highlighted in September, emergency support has reduced, but not stemmed, a major rise in unemployment. Those relying on support from universal credit will experience another shock to their household income if this uplift is not extended past March. Can we have a debate in Government time on making the uplift to universal credit permanent?
Mr Rees-Mogg
I do not want to be unhelpful but I have nothing to add to what the Chancellor said yesterday.
Rachel Hopkins (Luton South) (Lab)
I have heard first-hand from pubs across Luton South, including the Bricklayers Arms, the Castle, the Globe and the Chequers, about how the economic impact of the pandemic is destroying their businesses. So far, the economic support has not been sufficient to safeguard their future, and many are very frustrated that the scientific evidence has not been published to justify the extra restrictions on pubs, particularly those that do not serve food. Will the Leader of the House provide Government time for a specific debate on support for the pub industry so that we can protect our pubs’ future at the heart of our communities?
Mr Rees-Mogg
I know this is a matter of concern to many hon. and right hon. Members, as we all value the pubs in our own constituencies, and in these very difficult times, the closures have fallen very heavily upon them. There is support available of £3,000 a month for pubs that are forced to close or only to do takeaway, and there is other support for pubs in the different tiers. The £3,000 has been set at the median level of rent that they would have to pay, so the figure is based on an assessment. There will be time to discuss this because there will be a whole day’s debate on the covid regulations next week, and I encourage the hon. Lady to raise her point again then.
Nigel Mills (Amber Valley) (Con) [V]
The Leader of the House may have seen that the European Parliament is planning to sit between Christmas and new year to approve, hopefully, any Brexit deal. Can he update the House on what plans the Government have for this House to scrutinise the potential deal and how long Select Committees will have before the House votes to consider the full details if we do get a deal?
Mr Rees-Mogg
The House last sat on Christmas day, I understand, in 1656 and it is not the intention of Her Majesty’s Government, or my right hon. Friend the Chief Whip, to ask us to sit on Christmas day, or indeed the feast of St Stephen, this year. I will give updates on Government business and plans for recesses in the normal way, but at the moment have no further information to give.
Patrick Grady (Glasgow North) (SNP)
The Leader of the House spent more time on Twitter defending his decision not to allow virtual participation in debates than he did at the Dispatch Box on Tuesday, despite his claims of a debate. As the Leader of the House he should be the servant of the House—the servus servorum populi, perhaps. Unlike the Pope, however, he is not infallible. He needs to stop digging. He has to admit the he misread the will of the House. He has misunderstood what Members want. If he is so convinced of the strength of his arguments, he should schedule a debate in Government time. Let us have a proper call list. Let us have a full airing of the issues and a free vote, and see what the House wants to do on virtual participation.
Mr Rees-Mogg
I thought the hon. Gentleman was Scottish. It turns out he is a Gaul, or at any rate he has a great deal of gall to say what he has just said when there was two hours of debate. The House could have come to a decision, but he, with his friends the socialists, decided not to allow that vote to happen. One hon. Member managed to talk out his own amendment. This is a most unusual way of carrying on, but the Government have done everything they can to facilitate the ability of the House to come to a decision. As I said earlier, if you looked at the schedule of business for Tuesday and the matters that were under discussion, it was extremely likely, for anybody looking at that Order Paper, that the matter would come to a debate. That we did not do so is actually down to the Opposition Members who decided to talk at length early on. We tried to facilitate the House. That opportunity was not taken advantage of. I am deeply sorry about that, because I was hoping that my right hon. Friend the Member for Chesham and Amersham (Dame Cheryl Gillan), for example, would be able to appear remotely. The hon. Gentleman and the right hon. Member for Walsall South (Valerie Vaz) managed to stop that.
Mr Philip Hollobone (Kettering) (Con)
Kettering and Corby citizens advice bureau has just published its latest customer satisfaction survey, which shows that it has helped local people with 25,000 issues and helped them to access over £4 million of financial help. It also states that, of its customers: 98% said it was easy to access the service; 99% said they were happy with the advice received; and 100% said they would recommend the CAB to others. Can we have a Government statement praising CABs for the wonderful work they do, and highlighting the Kettering and Corby CAB, led by Debbie Egan, as a shining example?
Mr Rees-Mogg
The only organisation or individual in Kettering who would reach similar levels of satisfaction is my hon. Friend, who I think would probably get even higher levels of satisfaction than the 98% achieved by the citizens advice bureau. I would very much like to place on record, on my own behalf and on behalf of Her Majesty’s Government, our thanks to the citizens advice bureau, which has offered support and advice to the British people for 80 years. It does a fantastic job in Bath and North East Somerset, and I am very glad to hear that it does a fantastic job in Kettering and Corby as well.
Liz Twist (Blaydon) (Lab)
As we have heard today, it is Carers Rights Day. Our unpaid carers do an amazing job at any time, but during the covid-19 pandemic the pressures on them have been immense. I would like to thank those unpaid carers in my constituency, as well as Gateshead Carers and the Carers Trust Tyne and Wear who offer them support. Carer’s allowance is still only £67.25 a week, which is nothing. May we have a debate in Government time on carers’ rights and the need to increase the benefit allowance?
Mr Rees-Mogg
I join the hon. Lady in congratulating Gateshead Carers and the other organisations in her constituency that do such fine work to support carers in this difficult period. I reiterate what I said in answer to an earlier question. It is really important work, a labour of love, literally, and a very lonely labour, probably, in the lockdown circumstance. I cannot promise a debate in Government time, but I think to have a debate, in Backbench Business time or in Westminster Hall, in celebration of carers is a very worthy thing to do.
Felicity Buchan (Kensington) (Con)
I know that my right hon. Friend will not want to prejudge the regional tierings, but does he agree that it is critical that we get our great capital city, London, back into the lowest tiering as quickly as possible, and will he countenance a debate on how we can restore our great capital city to its former glory?
Mr Rees-Mogg
Mr Speaker, I am not sure that it is in order for me to cede the Dispatch Box to my right hon. Friend the Health Secretary, who is standing by your side, but my hon. Friend has timed her question to perfection, because just before my right hon. Friend comes in to make his statement, she has called for our great bustling metropolis to be able to bustle. Although London does have lower rates than some of the other regions in England, it is still at a higher level than before. The Government will monitor the information from a variety of sources, so that the decisions made are on an evidence basis. I, like my right hon. Friend the Prime Minister, am one of the House’s many optimists. I believe that, as we make progress with considerable speed to mass testing, and get closer and closer to a roll-out of mass vaccinations, London’s economy will soon be fighting fit again, and I hope to see our black taxis as full, busy and bustling as they were before the contagion hit.
Mary Glindon (North Tyneside) (Lab) [V]
Can we have a debate in Government time on the morale of workers across Government Departments in the wake of their real-terms pay cut announced yesterday, and with civil servants living in fear that, thanks to the Prime Minister, they now have no redress against bullying and harassment?
Mr Rees-Mogg
I completely reject the premise of the last part of the hon. Lady’s question. It is a misrepresentation—an inaccurate representation—of what was found by the Prime Minister earlier in the week. As regards what the Chancellor announced yesterday, it is worth pointing out that private sector wages have fallen by 1% while wages in the public sector have risen by 4% over the last year, and that ultimately, without the private sector, we have no money to afford the public sector. Therefore, there needs to be some degree of parity between the two. Most importantly, the least well-off—those on below the median wage of £24,000 a year—will receive an increase of at least £250 a year, which, with inflation running at 0.5%, is an above-inflation increase.
Munira Wilson (Twickenham) (LD)
Yet again yesterday the Chancellor completely overlooked the 3 million people who have been left out of any financial support during the pandemic. The Leader of the House will be aware that the gaps in support all-party parliamentary group is one of the largest APPGs, with 262 MPs, yet the Chancellor has refused to answer many of our letters, to meet us or to engage with representatives of the groups that he has forgotten about. My request to the Leader of the House is very simple: will he ask his right hon. Friend the Chancellor of the Exchequer to meet representatives of the APPG and the groups that he has neglected?
Mr Rees-Mogg
I do not, again, accept that representation of what the Chancellor has done. The Government have provided £280 billion of support. There is support available in different forms for many people across the country, and every effort has been made to support the economy as widely as possible. However, I have always viewed it as my role as Leader of the House to try to facilitate meetings between Members and Ministers. I cannot promise a meeting with the Chancellor of the Exchequer, but I will do my best to try to facilitate a meeting with Ministers in due course for the hon. Lady.
Valerie Vaz
Thank you, Mr Speaker. I know that it is unusual to take points of order before statements, but this is a matter of extreme importance. At 11.14 am, it was announced that people could find out which tier they were in via a journalist, rather than the statement to the House. I know that the Secretary of State for Health and Social Care is standing outside the Chamber. This is an appalling way to treat Parliament. Could I have your advice on whether that was an appropriate thing to do? The website has crashed because everybody is on it. There is no point in our being in the Chamber, where we should hear the announcement first—we might as well be sitting remotely, which the Leader of the House is not allowing. Could I have your advice on whether this was an appropriate way to deal with important information about the tiers?
Mr Speaker
That is not a point of order for the Chair, but I do have an opinion. This House—and I am sure the Leader of the House totally agrees with me—should be informed first. We keep telling the Government that that is the way that a good Government should treat and respect this Chamber. It is not acceptable to put the information online first. The only good thing is that the website has crashed, so it is not helpful, and we might get the statement first, but it is not acceptable. I say once again in the strongest terms—and I know that the Leader of the House will pass this on—that this House should hear it first. We are elected to hear it first, and the Government should give the House the respect that it deserves. Let us leave it at that.
In order to allow the safe exit of Members participating in this item of business and the safe arrival of those participating in the next, I am suspending the House.
Covid-19 Update
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Health and Social Care (Matt Hancock)
With permission, I would like to make a statement on coronavirus. We are approaching the end of a year where we have asked so much of the British people. In response to this unprecedented threat to lives and to livelihoods, the British people have well and truly risen to the challenge by coming together to slow the spread and support each other. I know how difficult this has been, especially for those areas that have been in restrictions for so long. The national measures have successfully turned the curve and begun to ease pressure on the NHS. Cases are down by 19% from a week ago, and daily hospital admissions have fallen 7% in the last week.
January and February are always difficult months for the NHS, so it is vital that we safeguard the gains we have made. We must protect our NHS this winter. We have invested in expanded capacity, not just in the Nightingales, but in hospitals across the land, and we have welcomed thousands of new staff. This morning’s figures show that the number of nurses in the NHS is up 14,800 compared with just a year ago, so we are well on our way to delivering on our manifesto commitment of 50,000 more nurses. Together, while we invest in our NHS, we must also protect our NHS, so it will always be there for all of us during this pandemic and beyond.
I am so grateful for the resolve that people have shown throughout the crisis. Thanks to this shared sacrifice, we have been able to announce that we will not be renewing our national restrictions in England, and we have been able to announce UK-wide arrangements for Christmas, allowing friends and loved ones to reunite and form a five-day Christmas bubble. I know that this news provides hope for so many, but we must remain vigilant. There are still today 16,570 people in hospital with coronavirus across the UK, and 696 deaths were reported yesterday. That means 696 more families mourning the loss of a loved one, and the House mourns with them.
As tempting as it may be, we cannot simply flick a switch and try to return life straight back to normal, because if we did that, we would undo the hard work of so many and see the NHS overwhelmed, with all that that would entail. We must keep suppressing the virus, while supporting education, the economy and the NHS until a vaccine can make us safe. That is our plan. We will do that by returning to a tiered approach, applying the toughest measures to the parts of the country where cases and pressure on the NHS are highest and allowing greater freedom in areas where prevalence is lower.
While the strategy remains the same, the current epidemiological evidence and clinical advice shows that we must make the tiers tougher than they were before to protect the NHS through the winter and avert another national lockdown. We have looked at each of the tiers afresh and strengthened them, as the Prime Minister set out on Monday. In tier 1, if you can work from home, you should do so. In tier 2, alcohol may only be served in hospitality settings as part of a substantial meal. In tier 3, indoor entertainment, hotels and other accommodation will have to close, along with all forms of hospitality except for delivery and take away.
I know that people want certainty about the rules they need to follow in their area. These decisions are not easy, but they are necessary. We have listened to local experts and been guided by the best public health advice, including from the Joint Biosecurity Centre. We set out the criteria in the covid-19 winter plan, and we publish the data on which the decisions are made. As the winter plan sets out, the five indicators are the case rate in all age groups; in particular, cases among the over-60s; the rate at which cases are rising or falling; the positivity rate; and the pressures on the local NHS.
When setting the boundaries for these tiers, we have looked at not just geographical areas but the human geographies that influence how the virus spreads, such as travel patterns and the epidemiological situation in neighbouring areas. Although all three tiers are less stringent than the national lockdown we are all living in now, to keep people safe and to keep the gains that are being made, more areas than before will be in the top two tiers. That is necessary to protect our NHS and keep the virus under control.
Turning to the tiers specifically, the lowest case rates are in Cornwall, the Isle of Wight and the Isles of Scilly, which will go into tier 1. All three areas have had very low case rates throughout, and I want to thank residents for being so vigilant during the pandemic. I know that many other areas would want to be in tier 1 and understand that.
My constituency of West Suffolk has the lowest case rate for over-60s in the whole country, and I wish to thank Matthew Hicks and John Griffiths, the leaders of Suffolk County Council and West Suffolk Council, and their teams for this achievement. However, despite that, and despite the fact that Suffolk overall has the lowest case rate outside Cornwall and the Isle of Wight, our judgment, looking at all the indicators, and based on the public health advice, is that Suffolk needs to be in tier 2 to get the virus further under control. I hope that Suffolk and so many other parts of the country can get to tier 1 soon, and the more people stick to the rules, the quicker that will happen.
We must make the right judgments, guided by the science. The majority of England will be in tier 2, but I am afraid that a significant number of areas need to be in tier 3 to bring case rates down. I know how tough this is, both for areas that have been under restrictions for a long time, such as Leicester and Greater Manchester, and for areas where cases have risen sharply recently, such as Bristol, the west midlands and Kent. The full allocations have been published this morning and laid as a written ministerial statement just before this statement began. I understand the impact that these measures will have, but they are necessary given the scale of the threat we face.
We will review the measures in a fortnight and keep them regularly under review after that. I want to thank everybody who is in the tier 3 areas for the sacrifices they are making to protect not just themselves and their families but their whole community. Regardless of their tier, I ask everyone to think of their own responsibilities to keep the virus under control. We should see these restrictions not as a boundary to push but as a limit on what the public health advice says we can safely do in any area. Frankly, the less any one person passes on the disease, the faster we can get this disease under control together—and that is on all of us.
We must all play our part while we work so hard to deliver the new technologies that will help us get out of this, in particular, vaccines and testing. The past fortnight has been illuminated by news of encouraging clinical trials for vaccines, first from Pfizer-BioNTech, then from Moderna and then, earlier this week, from the Oxford-AstraZeneca team. If these vaccines are approved, the NHS stands ready to roll them out as soon as safely possible.
Alongside vaccines, we have made huge strides in the deployment of testing. Our roll-out of community testing has been successful, because it means we can identify more people who have the virus but do not have symptoms and help them isolate, breaking the connections that the virus needs to spread. As part of our covid-19 winter plan, we will use these tests on a regular basis, for instance, to allow visitors safely to see loved ones in care homes, to protect our frontline NHS and social care colleagues and to allow vital industries and public services to keep running safely.
We have seen in Liverpool, where more than 300,000 people have now been tested, how successful this community testing can be. I want to pay tribute to the people of Liverpool, both for following the restrictions and for embracing community testing. It has been a big team effort across the whole city and the result is that in the Liverpool city region the number of cases has fallen by more than two thirds. In the borough of Liverpool itself, where the mass testing took place, cases have fallen by three quarters. It has not been easy and, sadly, many people in Liverpool have lost their lives to covid, but thanks to people sticking to the rules and to the huge effort of community testing, Liverpool’s cases are now low enough for the whole Liverpool city region to go into tier 2. This shows what we can do when we work together. We can beat the virus. I want to pay tribute to the people of Liverpool, NHS Test and Trace, the university, the hospital trust, Mayor Joe Anderson and so many others who have demonstrated such impressive leadership and responsibility, and a true sense of public service.
We are expanding this community testing programme even further to launch a major community testing programme, homing in on the areas with the greatest rates of infection. This programme is open to all local authorities in tier 3 areas in the first instance and offers help to get out of the toughest restrictions as fast as possible. We will work with local authorities on a plan to get tests where they are needed most and how we can get as many people as possible to come forward and get certainty about their condition. The more people who get tested, the quicker a local area can move down through the tiers and get life closer to normal.
Viruses can take a short time to spread but a long time to vanquish. Sadly, there is no quick fix. They call upon our determination to make sacrifices that will bring them to heel and upon our ingenuity to make scientific advances that will get us through. Hope is on the horizon, but we still have further to go, so we must all dig deep. The end is in sight. We must not give up now. We must follow these new rules and make sure that our actions today will save lives in future and help get our country through this. I commend the statement to the House.
Jonathan Ashworth (Leicester South) (Lab/Co-op)
I thank the Secretary of State for advance sight of his statement. I suppose that we should all thank him for advance sight of the website, but sadly, it crashed before we could check what tiers we were in.
The news of a vaccine is indeed light at the end of the tunnel, but we are still in the tunnel and we have a significant way to go to drive infection rates down and keep our constituents safe. We understand why tough restrictions are still needed, but let us be clear: today, millions of people trying to survive in the second lockdown will soon be forced to endure further local lockdown restrictions, so does the Secretary of State accept that these interventions succeed when made in tandem with local communities?
I remember that when areas such as Bury and Trafford went into lockdowns in the summer, the Secretary of State promised that MPs would be involved in the decision. Has that commitment been abandoned? Then, Ministers agreed to involve regional leaders, but took exception to being challenged by Andy Burnham, so what role do regional leaders now have in these decisions, or is the position really that the Prime Minister imposes from Downing Street restrictions on communities across the midlands and the north—restrictions that will have a huge impact on the livelihoods of families and small businesses?
Christmas, the Secretary of State will know, is vital for pubs, restaurants and entertainment venues across those areas. They will need substantial financial support to get through this period. Will those areas that went into tier 3 lockdowns before the national lockdown, such as Greater Manchester and South Yorkshire, get backdated economic support for their local small businesses?
Parts of the country, such as my own city of Leicester, Bury, Leigh and Heywood, have been under a form of lockdown for months, with families forced apart and grandparents not seeing their grandchildren. Those families today will want to know what the exit strategy is and what voice they will have in that strategy. The Secretary of State has outlined five criteria by which local lockdowns will be judged. Will he publish clear, transparent rules for areas entering and leaving tiers—a score card for every area, assessing its covid progress against its criteria, so everyone can judge this publicly?
The Secretary of State talks of mass lateral flow testing, and we welcome the advances, but over two weeks ago he announced he was sending, I think, 930,000 of those tests to local authorities, yet only around 8,500 are being used a day. Can he explain why that is? He will also be aware—I am sure that he will have studied this—that Slovakia recently tested more than 3 million people over a weekend using those tests. The Slovaks incentivised people to get tested by offering greater freedoms. Is that part of the Government’s thinking on how those tests could be used?
Evidence from Liverpool suggests that there is a lower take-up of tests in poorer, harder to reach communities. Is not the problem that if people and their contacts feel they will be financially penalised for a positive test, they will avoid a test, they will switch off the app and they will not answer their phone to unrecognised call centre numbers? The reason people soldier on when ill is not a stiff upper lip: it is that they cannot afford to feed their families otherwise. Surely, after months and months, it is now obvious that low-paid people such as care workers on zero-hours contracts need better support to isolate. Why did the Chancellor not increase statutory sick pay in the spending review yesterday?
The test and trace budget has now increased to £22 billion, more than the annual budget for the police and the fire service combined, yet the Office for Budget Responsibility yesterday confirmed that its forecasts are based on the fact that
“a less effective TTI”—
test, trace and isolate—
“system necessitates keeping a more stringent set of public health restrictions in place over the winter.”
At what point will the Secretary of State accept that the current Serco model has failed? I am not against using the private sector, but I am against throwing shedloads of taxpayers’ money at failing private sector contracts. Local authorities, especially those now in tier 3, should be leading this retrospective contact-tracing work, and they should be given the data from day one, so they can get on with it. By the way, why was there no uplift yesterday in the public health grant? Surely, this is a time when we should be investing in public health, not freezing the grant.
On the easements for Christmas, there will indeed be relief in families across the country, but the Secretary of State will understand that there will also be nervousness across the NHS. We need a clear public health message: asking people to be jolly careful is not good enough. He will know that January is an immensely busy and pressured time for our NHS. It is not just the patients filling up covid beds; it is the emergency pathways that are already running at hot and it is the immense elective backlog. We know there are fewer beds because of social distancing. We know staff are exhausted. One in seven hospitals have restricted electives or planned operations so far this winter. What plans are in place to protect the NHS through January, especially if there is a long cold snap? How many elective operations does he anticipate will be cancelled in January? Nobody in this House wants to see a third lockdown, so can he guarantee that the measures he has announced today will be enough to bring the R down and sustain it below 1 for the coming months until a vaccine allows life to return to normal?
Matt Hancock
The goal of the Government is to bring R to below 1 to suppress the virus until a vaccine can keep us safe. That is the strategy.
I shall take the precise points that the hon. Gentleman raised. He asked for an exit strategy. The statement I outlined is the exit strategy: it is to keep the virus suppressed with the minimum damage possible to the economy and, indeed, to education, while we work as fast and as hard as we can towards a vaccine and with the widespread use of community testing across the piece to help to keep the virus under control.
I would have expected the hon. Gentleman to welcome the massive progress in Liverpool that has shown that a combination of sticking by the rules and community testing at very large scale can help to bring this virus right under control. Instead, he criticised that it does not get into harder to reach communities. That is exactly where we need to get into, and that is why we do it in combination and hand in hand with the local authority.
I praise Joe Anderson, and I also praise other local leaders, such as Ben Houchen in Tees Valley, who is working with us on this, Andy Street and leaders across the west midlands, and the hon. Member for Barnsley Central (Dan Jarvis) in South Yorkshire, who we are working with to get a community testing system up and running in places such as Doncaster. I want to see the community testing that has been successful in Liverpool rolled out right across the tier 3 areas as much as is possible, and I invite all councils to engage.
We invited councils to engage ahead of the decisions today, and we also invited all colleagues in the House to have an input, but it is important that we have clear public health messaging, because unfortunately we did see the number of cases going up and continuing to go up in those areas where local leaders were not working alongside us. It was a sharp contrast to what happened, for instance, in Liverpool, but also in other areas where the local leadership was so constructive and positive.
The hon. Member for Leicester South asked for a scorecard for the exit strategy. We publish the data, and if we can make it into an even more accessible format, I think that is a good idea. He asked about supporting the NHS—absolutely. I am delighted that, yesterday, my right hon Friend the Chancellor of the Exchequer, with the support of the Prime Minister, put another £3 billion into the NHS, on top of the £6.6 billion that is already being invested. That money starts flowing this financial year for this winter and then runs into next year.
The hon. Gentleman mentioned the need to support people who have tested positive. We have put in place a £500 support payment. On NHS Test and Trace, I thought from the figures this morning that he would have welcomed the fact that the majority of in-person tests are now turned around within 24 hours. That is significant progress on the speed of turnaround in testing, for which I am very grateful to my team. There will be further support for local councils that find themselves in tiers 3 and 2 to support the action that is needed. But all in all, let us come together and work together to get this virus under control and keep it under control, so that we can get life back to normal as soon as possible.
Jeremy Hunt (South West Surrey) (Con)
May I welcome the Prime Minister back from his splendid isolation to the place that he has no doubt been itching to get back to more than any other—this House of Commons—and say how wonderful it is to see him here?
Jeremy Hunt
From a sedentary position, I think the Prime Minister said that he was delighted to see me here. [Interruption.] Indeed, he is delighted to see me here—on the Back Benches. [Laughter.]
Turning to more serious matters, these are very difficult decisions, and part of the leadership we have to show in a pandemic is telling people unwelcome news. I want to salute the Health Secretary’s cautious approach to Christmas because, much as we all want Christmas to be as normal as possible, nothing would be more crazy than to take our feet off the accelerator at this moment and then see a spike in deaths in February, so I think this is the right approach.
There is one bit of further good news—on top of the news about vaccines and on top of the news about mass testing—that I know the Health Secretary would like to be able to give and that would be enormously welcome: that every single person living in a care home could be sure that they could be visited by a close relative before Christmas. I know he wants to do that, but there are huge logistical challenges in getting that mass testing technology to work in time. May I urge him to do everything he can, because that would make such a big difference to the nearly 400,000 people in care homes?
Matt Hancock
I hesitate to interrupt the love-in between the Prime Minister and my predecessor, but I am grateful for his support—for their support. This is a set of difficult measures, but I think the public understand why we have to take them and why they are necessary.
On the point about getting visiting going in care homes, my right hon. Friend is absolutely right. Sometimes we talk about these tests and this new technology in an abstract way or from a scientific point of view, but it really matters and it really improves people’s lives. Where we can use testing to make visiting safe in care homes, that is an example of the way in which these new technologies can help to get life a little bit back towards normal. Of course, it must be done in a safe way and carefully, but we are now developing the protocols for exactly how that can happen and working hard with the goal that everyone should have the opportunity to visit a loved one in a care home before Christmas.
Dr Philippa Whitford (Central Ayrshire) (SNP) [V]
Many scientists have expressed concern that the easing of restrictions at Christmas could lead to another surge of covid cases in January. With cases still over 80% of the level at the start of lockdown, is the Secretary of State not worried that allowing outdoor events of 2,000 participants and indoor events of 1,000 in level 2 high-risk areas could drive up infection rates ahead of Christmas? Although lateral flow testing is very welcome, given how it increases capacity, the Secretary of State previously stated that the mass testing in Liverpool was a pilot and would be evaluated before being rolled out elsewhere. As the city has also been under tight restrictions and then lockdown, how will the impact of mass testing alone be evaluated? How does he plan to counter the lower uptake among deprived communities—the very ones at highest risk, as seen in Liverpool—and with no clinical evaluation yet published, how can he justify putting out contract tenders for an eye-watering £43 billion and rolling out this approach to 67 other areas? Should this strategy not be compared with investing money and energy in getting the traditional test, trace and isolate system working properly? Currently, over 40% of contacts in England are still not even informed that they should be isolating.
Finally, the Secretary of State knows that it is not testing, but isolation, that stops the spread of the virus. If people who are infected or could be carriers are not isolating, no amount of testing will stop viral spread. A study by King’s College London that suggested that fewer than a quarter were isolating when advised was incredibly worrying, so what assessment are the Government doing to clarify current isolation rates and understand the reasons why people may not follow the advice they are given?
Matt Hancock
Of course, we are constantly evaluating the impact of people isolating, and how many people isolate when asked to. I would encourage the hon. Lady to look at a broader range of studies than just that one from King’s College, especially those dealing with the self-isolation of those who test positive, for whom the rate tends to be higher.
The hon. Lady asked about the use of these lateral flow tests to have a negative impact on the number of cases in an area. Of course, we have been evaluating this all the way through the study in Liverpool, which is why we can have confidence in rolling out more broadly across tier 3 areas. I included in my statement a high-level assessment of this. The number of cases in Liverpool city region is down by two thirds, but in the city itself, where the testing took place—the testing was of people who live in the city and of people who work in the city and live largely in the wider city region—the number of cases is down by over three quarters. That is one piece of evidence. It is clear that it is the combination of people following the rules and community testing, with appropriate incentives to get people to take up that mass community testing, that can help to make this work. We want to work with local directors of public health to understand how this can work effectively in their areas, precisely to reach those hard-to-reach people whom the hon. Lady mentioned.
Finally, I echo the hon. Lady’s request that we be cautious this Christmas. However, I am delighted that we have agreed an approach across the whole UK, including with the SNP Administration in Edinburgh, with the Welsh Labour Administration and the cross-party Administration in Northern Ireland, because there are so many ties that bind us together and mean that we are stronger as one United Kingdom, working together to tackle this virus.
Greg Smith (Buckingham) (Con)
It is incredibly disappointing news that Buckinghamshire, having entered the national lockdown in tier 1, will emerge from that lockdown into the more punitive restrictions of tier 2 —a decision that will be hard to understand in the rural communities of north Buckinghamshire that have relatively low infection rates, and one that is hard to understand given that there has been zero consultation between central Government, Buckinghamshire Council and our local NHS. Appreciating that my right hon. Friend has impossible choices to make in order to control this virus, will he commit to ensuring that Buckinghamshire Council and our local NHS are fully consulted as these tiers are reviewed going forward?
Matt Hancock
Yes, of course. Along with my hon. Friend, the director of public health in Buckinghamshire was invited to engage with the team as we were looking at the indicators and making this decision. These are difficult decisions; he is right about that. The case rate in Buckinghamshire is 138 per 100,000, and positivity is above 5%. We will review these allocations in a fortnight and then regularly thereafter. I look forward to working with my hon. Friend and supporting the people of Buckinghamshire to do what is right, to get the case rate down and to get Buckinghamshire—if at all possible, and if it is safe—into tier 1, with the lighter restrictions. But it is critical, to keep people safe, that we take the action we need to today.
Munira Wilson (Twickenham) (LD)
A recent University College London study found that less than half the public understood what the rules were in the previous tier system. Today we have a new tier system. We have a five-day relaxation at Christmas. We have a Government website that has crashed this morning. The written ministerial statement published this morning has a number of question marks against different areas. There are inconsistencies between what the Prime Minister has said, what the OBR has said and what the Secretary of State has told MPs about the length of restrictions. I have a simple request: will the Secretary of State ensure that there is a clear, consistent and honest communications campaign to ensure public trust and compliance and so that we do not overly raise expectations?
Matt Hancock
Yes, there will be a widespread public information campaign about these new tiers. It is on all of us to follow the rules in our local area. Notwithstanding the rules, we all need to behave in a responsible way, because we all have a role in controlling the spread of the virus.
Julian Sturdy (York Outer) (Con) [V]
As the Government continue to impose further unprecedented restrictions on people’s freedoms, it is important to give people hope and justification. As York’s covid rate continues to fall and is the lowest in Yorkshire, can the Secretary of State outline how we can get to tier 1 as fast as possible? Will he publish the assessment and the data based on which York was placed in tier 2, so that we can best judge how to get to tier 1? He talks about regular reviews, but a weekly review would be much more desirable.
Matt Hancock
Yes; I can answer positively on all counts. We have a regular weekly session to go through all these. I am committing to regular reviews rather than weekly ones simply because we sometimes have to do it more than weekly, especially if cases are shooting up in an area. On my hon. Friend’s point about publication, we have published today not only the data—and we will publish more data on each area—but an explanation of the reason for the decision taken in each area. I know that he and colleagues across York have worked hard, because there was quite a serious spike in York, and it is coming down at the moment. Overall, we still require the whole of North Yorkshire to go into tier 2 because the case rates are still elevated right across it, and we all need to work together to get them down.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I share the concern of my neighbouring colleague, the hon. Member for Twickenham (Munira Wilson), about clarity over tiers and messages. One message and rule that is clear but unwelcome is the 11 pm curfew for pubs and restaurants. Curfews fail to address the issue of crowds in the streets and on public transport, which risk spreading infection. Will the Secretary of State commit to meet London government, including the Mayor of London, as soon as possible to discuss this and agree the criteria that London needs to meet to de-escalate as soon as possible?
Matt Hancock
Of course we have been engaging with the team who work across London. There is a lot of work to do in London. There are parts of London where cases continue to rise, and we need to get that under control, but there are also parts where they are falling and things are very much going in the right direction. Likewise, there is pressure in some parts of the NHS, but there is a lot of mutual aid within the NHS across London. There is a lot of work to do in London to keep it in tier 2, and I look forward to working with the hon. Lady and other London colleagues on that.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
People living in Runnymede and Weybridge often ask me on what basis we are subject to local tiers and to restrictions, and it is clear that, alongside the data, other factors are taken into account in the two decisions. I thank my right hon. Friend for his response to the question from my hon. Friend the Member for York Outer (Julian Sturdy) that the reasons and the data will be published. Will local hospital bed utilisation be part of the reasons published?
Matt Hancock
Yes. There are five indicators that we take into account in deciding on which tier. One is pressure and anticipated pressure on the local NHS, and bed occupancy rates are of course a critical part of that assessment. I know that people are looking for a clear numerical boundary between the different tiers, but because we are looking at five different indicators rather than a single one, there is no automatic figure at which a different tier is triggered. We have to look at all the circumstances, including, for instance, outbreaks. Some cities, on their pure numbers, would be in tier 3, but because an outbreak is specific—for instance, in a school or care home—it is appropriate that they are in tier 2. We have to look at these very localised issues as well, and that is why the engagement with local directors of public health is so important.
Sir Robert Syms (Poole) (Con)
There will be bitter disappointment in Dorset, in both the urban and rural areas, that we are in tier 2 even though our infection rates are now falling quite rapidly. My main interest today is finding out how we get out of tier 2 and into tier 1. If we are going to have regular—that is, weekly—reviews, that is great and fine, but if we are not, and we are stuck in that tier for two or three weeks, would the Secretary consider some kind of appeals process, and might his admirable Minister for Health be the appeals process?
Matt Hancock
We work as a very cohesive team of Ministers in the Department, and we all work on covid-related issues. I take my hon. Friend’s gentle chiding that he would rather my No. 2 took these decisions, but I am afraid he is stuck with me for the time being.
On the serious point that my hon. Friend raises, we will review the tiers in a fortnight and then regularly, which he can reasonably take to be weekly. We have a weekly cycle of meetings, with the chief medical officer chairing a meeting, typically on a Tuesday. I then chair a meeting on a Wednesday for an announcement on Thursday of any change to the tiers.
Geraint Davies (Swansea West) (Lab/Co-op) [V]
The Secretary of State knows I chair the all-party parliamentary group on air pollution, so he will not be surprised if I point out that tier 3 areas tend to be the areas with the highest pollution. Every microgram of PM2.5 per cubic metre increases covid deaths by between 14% and 18%, and that is on top of the 40,000 deaths annually from air pollution. Does he agree that we need cross-Government activity and an all-Government report annually—from the Department for Environment, Food and Rural Affairs, the Ministry of Housing, Communities and Local Government and the Department for Transport—on what they are doing individually and collectively to combat air pollution and, in so doing, to reduce the covid death rate and the overall death rate? I can see the Prime Minister nodding sagely. Would the Secretary of State agree to an annual report?
Matt Hancock
It is very impressive that the hon. Gentleman can see the Prime Minister, since he has just left the Chamber, but I am sure the Prime Minister is nodding sagely, wherever he is. The hon. Gentleman makes a very serious and important point, on which we agree. Air pollution is a very serious issue. In lockdowns, air pollution has been reduced; that is one upside to what are otherwise very damaging things to have to do, but they are necessary to keep the virus under control. I hope we can continue to work together on tackling air pollution long after this pandemic is over.
Richard Graham (Gloucester) (Con)
With Gloucestershire in tier 2, next to South Gloucestershire, in tier 3, and the Welsh border, will the Secretary of State confirm that there will be no travel restrictions between different tiers or across the Welsh border? Since the Government can change tiers without debate, which has a huge impact, especially on the hospitality sector in terms of moving from tier 2 to tier 3, will he also confirm when the tier decisions will be published?
Matt Hancock
I am afraid that I cannot confirm that with respect to the Welsh border, because the legal restrictions on travel were a decision by the Welsh Administration, rather than by the UK Government for England. We have taken the view that travel restrictions should be in guidance, because there are all sorts of complicated circumstances in which people might need to travel. We have done that when we have been in national lockdown across England, as well as locally. I am sorry that I cannot be clearer than that. On the point about renewal and when we review these matters, we are proposing to review first on 16 December and then regularly thereafter to ensure that we keep the tiered restrictions as up to date as possible.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab) [V]
The Health Secretary will know the pressure that Pinderfields Hospital, especially, has been under. The staff there have been doing an incredible job. It is welcome that the number of covid patients in hospital is starting to fall and that the number of infections locally has fallen by around 30% in the last week, but he will also know that our NHS, social care and public health staff have had a really difficult year and that the winter is going to carry on being tough, with many operations to catch up on. Will he now look swiftly at the case for added support and pay for NHS, public health and social care staff this winter, in recognition of the incredible job they have been doing to care for all of us?
Matt Hancock
I am delighted that we have a significant increase in the number of NHS staff. The figures published this morning show that there are 14,800 more nurses than there were this time last year in the NHS. I am really pleased about that. The right hon. Lady will no doubt have seen yesterday that the pause on pay increases across the public sector announced by my right hon. Friend the Chancellor does not apply to nurses and doctors. That is, in part, in recognition of the incredible work that they have done during this pandemic.
Jeremy Wright (Kenilworth and Southam) (Con)
As the economic damage the pandemic is doing becomes increasingly apparent, it is clearly right that businesses of all types are reopened as soon as it is safe to do so. This will take longer than it needs to if the restrictions on those businesses are calculated on the basis of virus information for places a long way away or as a geographical average for a wide area encompassing urban and rural parts. That is exactly what is going to happen to the businesses in my constituency, which will not be able to open next week if they are hospitality businesses, not because of the rates where they are, but because of the rates somewhere else. Surely it is more sensible to calculate restrictions on the smallest geographical area where data is reliable, which is largely boroughs and districts. Will my right hon. Friend commit in his review in two weeks’ time to look not just at whether individual areas are in the right tier but at whether the areas are properly constructed?
Matt Hancock
Yes, absolutely. My right hon. and learned Friend is absolutely right about the importance of this. We have to balance the need for an area to reflect the human geography in which people live and effectively communicate the tiering decisions across that geography, with precisely the concerns that he mentions. For instance, Slough is in tier 3, despite the fact that Berkshire, of which it is a part, is in tier 2, so we are prepared to take those decisions at a lower-tier local authority area level. That is the exception rather than the norm, but we look at this every single week.
Patricia Gibson (North Ayrshire and Arran) (SNP) [V]
Covid-19 is a world pandemic and it needs to be tackled on a global basis. International travel will expose the UK to future outbreaks, particularly if the virus mutates, so on both humanitarian and public health grounds, does the Secretary of State not agree that it is indefensible to cut the international aid budget, just as a global vaccine roll-out begins?
Matt Hancock
Of course, we have been hugely supportive. In fact, the UK is the biggest supporter internationally of providing vaccines in countries that would not be able to afford them themselves. I am sure that that will continue, because we will continue to have one of the largest international aid budgets in the world.
Peter Aldous (Waveney) (Con)
I know that my right hon. Friend will thank everyone in both East and West Suffolk for getting down the level of infections, and that it is with a heavy heart that he has concluded that the county cannot exit to tier 1. Will he ensure that there are clear indicators as to what else needs to be done so that Suffolk may move to tier 1 as quickly as possible, and will he liaise with the Chancellor of the Exchequer to put in place additional support for the hard-hit hospitality sector?
Matt Hancock
I have constant discussions with the Chancellor of the Exchequer about the support needed. My hon. Friend is right to raise that, especially in Suffolk. It is with a heavy heart that we took the decision on Suffolk. Its case rate is higher than the Isle of Wight or Cornwall, which are the two areas in tier 1, but that gives an indication of where we need to get to. I am sure that if we all work together, we will be able to get there.
Mrs Emma Lewell-Buck (South Shields) (Lab)
We are stuck in an endless cycle of lockdowns that are simply not working. The Government have again wasted the opportunity over the past few weeks to get a handle on testing, tracing and isolating. Once again, hospitality in South Shields will be absolutely battered, and my constituents’ liberty impacted on. Will the Secretary of State tell us exactly what will be different this time that will make our sacrifices yield a reduction in the infection rates?
Matt Hancock
First, I urge the hon. Lady to look at the figures published this morning, which show that the majority of tests when done in person are now turned around within 24 hours across the country, and capacity has increased radically. What I would ask of her for the future, to help the north-east get out of tier 3, is to work with her local councils, with the directors of public health, to embrace the community testing that has been effective in Liverpool. If they are up for doing that—it has to be in consultation and conjunction with the local council, because they know the area—I very much hope that they will come forward to pick up the baton and make that happen.
Mr Laurence Robertson (Tewkesbury) (Con) [V]
This is not an easy question, but how will the Health Secretary take into account the wider mental and physical health implications for people who are prevented from living their lives as they would wish to live them?
Matt Hancock
We look as much as we can at taking the impacts into account. For instance, the mental health of people under lockdown is of course more challenged than in normal circumstances. We balance that against the impact of covid both directly and in filling up the hospitals on the healthcare that we all get for all the other conditions that exist. It is a difficult balance to strike. On the particular impact on mental health, which my hon. Friend raised, the Royal College of Psychiatrists has done very interesting work to understand the nuanced balance between the impact of covid on people’s mental health and the impact of lockdown. Both are significant and I commend its work to him.
Mary Glindon (North Tyneside) (Lab) [V]
It is devastating that after all its efforts, the north-east will be in tier 3. Across the whole country, obesity remains a serious factor in covid-19. Yesterday, the all-party group on obesity launched its report to build on the Government’s obesity strategy. Will the Minister meet officers of the group to discuss the report’s recommendations and work with us to ensure a focus on the prevention and treatment of obesity in the fight against covid-19?
Matt Hancock
Yes. the hon. Member and I share an enthusiasm for this agenda with the Prime Minister, who is a personal convert to the need to tackle obesity. In fact, this crisis shows how important it is, because people who are obese are more likely to have a more serious impact from covid, if they catch it.
Rob Butler (Aylesbury) (Con)
We have consistently been told that we must accept restrictions to protect the NHS, and Buckinghamshire Healthcare NHS Trust has done an amazing job in dealing with the pandemic from the very beginning. Can my right hon. Friend therefore explain the weighting that he puts on the pressures on the local NHS as one of the five indicators in the decision-making process over tiers? It will be very difficult for people in Aylesbury to accept stringent controls on our lives and livelihoods if, in fact, there is plenty of capacity in hospitals for both covid and non-covid cases.
Matt Hancock
We look at all five indicators essentially equally. The point about pressure on the NHS is a more sensitive indicator on the decision to go into tier 3. If an area is in the situation that Buckinghamshire is, for instance, where the case rate is elevated, but not as high as in many other parts of the country, the key thing to do is to keep that case rate where it is or lower. We could not make the decision to put Buckinghamshire into tier 1 because, if it went up from where it is, it would not be long until Buckinghamshire were in trouble. Therefore, the decision was to put it into tier 2.
I very much hope that the cases can continue to go down until they are very low—like they are in Cornwall and on the Isle of Wight, for instance. We will then be able to review and consider tier 1. I hope that that is a reasonable explanation. We need to continue to debate this matter as we try to ensure that we get the judgments around these geographies exactly right.
Rachel Hopkins (Luton South) (Lab)
The good people of Luton will want to get out of tier 2 as soon as possible, but the current resources provided to Luton Borough Council for the lateral flow rapid testing pilot are insufficient to enable it to provide the level of mass testing that is being described nationally. The contained funding—£8 per person—just will not cover tests for 10% of Luton’s population, as the funding also needs to be used for the wider covid response, including wellbeing support for vulnerable residents. Can the Secretary of State confirm that there are national plans to provide additional support and resources to expand testing if the intention to test close contacts daily is pursued?
Matt Hancock
Yes, there will be further funding for those areas that go into tier 2 and yet more funding for the areas that go into tier 3. That funding will go to the councils for the extra support that is needed.
Christian Wakeford (Bury South) (Con)
I thank the Prime Minister for the flexibility that the Government are providing so that we can all have a family Christmas. However, let me ask my right hon. Friend the Health Secretary: what consideration has been given to Hanukkah, which starts two weeks today, regarding family gatherings and public menorah lightings? Does he think it is fair if no flexibility is shown to the Jewish community?
Matt Hancock
We carefully considered this issue, consulted on it and discussed it widely. Christmas is a national holiday, as well as being very much a Christian celebration. That is reflected, for instance, in the fact that we have two days of bank holidays. We consulted members of different faiths around precisely the question that my hon. Friend rightly raises, and there was a strong degree of support for having something special in place for Christmas for everybody, even though we have not been able to put that in place for Hanukkah or for other celebrations of other faiths.
Liz Twist (Blaydon) (Lab)
May I start by assuring the Secretary of State that directors of public health and local authorities in the LA7 area and the wider north-east are certainly very focused on getting that figure down and have had some success? I would like to make that absolutely clear. The second point I would like to make is that my constituents and others across the north-east will be hugely disappointed to find they are in tier 3, particularly those businesses in hospitality and leisure which are going to be so desperately hit by this. The real point I want to make, however, is about public health. Nothing has shown more than this pandemic that public health should be at the heart of what we do. We know it affects outcomes in covid-19, and we know it affects health inequalities and the rate of transmission. Will the Secretary of State ensure that he impresses that on the Chancellor, and ask him for more funding for public health services, both now and in the future?
Bob Stewart (Beckenham) (Con)
My constituency of Beckenham is very relieved to be in tier 2. Very kind of you, Secretary of State. I have had a couple of constituents ask me whether they have to have a vaccination. I have said that no, they do not, as far as I know. Can he tell the House what percentage of the population is required to be vaccinated in order for the measures to be effective, so we can get back to normal?
Matt Hancock
I would urge everybody to get a vaccination, if we manage to get a vaccine that is approved by the authorities, because the regulator will only approve a vaccine if it is safe and effective. Having said that, we are not planning to make it mandatory, because we hope that the vast majority of people will take it up, not least because it will help to protect them and their community, and get the whole country and indeed the world out of the mess we are in.
Barbara Keeley (Worsley and Eccles South) (Lab) [V]
The winter plan confirms that the Government will be taking action to restrict the movement of care staff between care homes. On the face of it, that is a perfectly sensible infection control measure. However, many care staff are forced to work between multiple homes because of low hourly wages. Can the Secretary of State therefore give a commitment that care workers will suffer no loss of income as a result of the policy? Can he set out what he will do to ensure that no care staff lose any of their jobs because they are being forced to choose between the different homes they work in?
Matt Hancock
I hope that, partly through this measure and the increase in the national living wage that the Chancellor confirmed yesterday, we can improve the pay and conditions of staff across social care. The proportion of people in social care who work in a number of settings and work in agency and less secure work is, in my view, something we should tackle together. I hope we can use what has obviously been put in place, as the hon. Lady rightly says, for public health infection control reasons also to improve employment standards across social care. That is, of course, directly contracted by local authorities, rather than by central Government. Nevertheless, this is an area that I think we all know we need to work to improve as a nation.
Dr Julian Lewis (New Forest East) (Ind)
I am sure my right hon. Friend appreciates that many elderly people die with serious illnesses, such as prostate cancer, but not from those illnesses. How certain is he that statistics showing the number of people dying with covid-19 are not being presented or misinterpreted as people dying from covid-19?
Matt Hancock
The statistics on the number of people dying with covid-19 are the best estimate that the statistics authorities, both in Public Health England and the Office for National Statistics, come up with. It is one of the widest definitions, which countries use internationally. Therefore, as my right hon. Friend implies in his question, it does include people who may have died of something else, but with covid. Nevertheless, each of these deaths we should work to avoid. The best measure, according to the chief medical officer, is the total number of excess deaths compared with this time of year last year. That is elevated now and we need to get it down.
Layla Moran (Oxford West and Abingdon) (LD) [V]
May I first thank the Secretary of State for listening to local leaders, who have been pushing for a one-Oxfordshire approach to coronavirus as we go into tier 2? I am sure many residents understand the need to be careful for Christmas. Despite Oxfordshire’s data being better than that of surrounding counties, we cannot risk any further damaging lockdowns. The reason we have done so well is superb team working and a county-wide systems approach, involving all councils, the NHS and businesses. In particular, we were quick off the mark to implement a local test, trace and isolate system, which is paying dividends. Does the Secretary of State agree that the key to beating this virus is to treat local areas as partners, and when they say they should be moving up and down tiers will he give their voice considerable weight?
Matt Hancock
Yes, I do give considerable weight to local leaders when they make a case for a particular tier for their area, and in the hon. Member’s case I would like to pay tribute to Ian Hudspeth, who has worked incredibly hard during this crisis for the benefit of people right across Oxfordshire. I talk to him regularly about the situation in Oxfordshire, which has made great strides in tackling this virus, including tackling the student outbreak at the universities in Oxford. I hope they can work to get Oxfordshire appropriately down into tier 1 as soon as possible, but there is some work still to do.
Antony Higginbotham (Burnley) (Con)
Today’s decision will be disappointing to businesses and residents across Burnley, who have had extra restrictions on their lives and their businesses for longer than most, so can my right hon. Friend set out exactly what support is going to go to Burnley and the wider Lancashire area, and when it will be delivered, so we can end these restrictions as soon as we possibly can?
Matt Hancock
Yes, Burnley has been in restrictions for a long time now. It has brought its case rate down by about half since the peak in late September. My hon. Friend has played a dutiful and impressive role in his public leadership within Burnley. I hope that we can work with Burnley Borough Council and Lancashire County Council to get the case rate down and get Lancashire down into tier 2, in the same way that Liverpool has managed to come down into tier 2: a combination of people following the rules and community testing. That is available to people in Lancashire, and I very much hope to be able to work with the team in Burnley and across Lancashire to make this happen.
The final thing I would say is that these are tough measures; I get that. I understand the impact on hospitality, but they are done for the right reasons, which is to keep people safe and stop the local NHS being overwhelmed.
Charlotte Nichols (Warrington North) (Lab)
Warrington will be breathing a sigh of relief that we are emerging from national lockdown into tier 2, but while I welcome the return of fans to stadiums, I cannot support the extension of the substantial meal requirement to tier 2, which will leave many pubs across my constituency closed. The pub sector faces an existential threat and it flies in the face of logic and fairness that thousands can congregate at the rugby but wet pubs that are at the heart of our community must stay closed. Will the Secretary of State commit to publishing the specific evidence that underpinned the substantial meal requirement extension and, if he cannot, to removing this requirement?
Matt Hancock
Unfortunately, we will not be removing that requirement from tier 2. It is incredibly important that we keep the cases under control. The local team in Warrington has worked very hard along with the Liverpool city region to get the case rate down. They went into national lockdown in tier 3 and have come out in tier 2, and the people of Warrington should be commended for that, but the measures of tier 2 are necessary to keep the virus under control because, unfortunately, the virus thrives when people get together. The hon. Member mentioned the point about events in larger scale. They will only be held where there is very stringent social distancing, so there will not be congregations, as she said, of thousands of people—I would like to reassure her of that—because these events will only take place when the capacity in normal times of any venue is much, much bigger than the number of people who are there.
Suzanne Webb (Stourbridge) (Con)
First, I want to thank residents in my constituency for their hard work and sacrifice; their borough has been hard hit by the virus. With my constituency being in one of the worst affected areas, will my right hon. Friend consider rolling out the vaccine as a priority when it is ready to the country’s worst affected areas, which have been not only blighted by this virus, but hard hit economically? These are the areas that will be in much need of assistance to get back on their feet following prolonged lockdown of the local economy. The vaccine would provide much needed respite in these worst affected areas.
Matt Hancock
We have taken the decision to roll out the vaccine UK-wide at the same pace. I want to get it as soon as possible to the west midlands and to everywhere else, but it is fair to the areas that have had a low, or relatively low, incidence of the disease to make sure that they also have access to the vaccine. Also, the incidence in different parts of the country changes, and the vaccine roll-out programme is very complicated. It does not speed up the delivery of the vaccine in one area to have slowed it down in another. That is why we have taken a UK-wide approach.
Ms Nusrat Ghani (Wealden) (Con)
In keeping with my right hon. Friend’s spirit of working together, I stand not only to represent Wealden, but to speak on behalf of my hon. Friends the Members for Bexhill and Battle (Huw Merriman), for Eastbourne (Caroline Ansell) and for Hastings and Rye (Sally-Ann Hart). We wish to collectively thank the CEOs of the clinical commissioning group and East Sussex Healthcare NHS Trust, our county leader, Keith Glazier, and our local department for public health for working with us day in, day out to understand the data and the reason for the infection rates.
We are deeply disappointed that, considering all the five indicators, where we mark extremely low, we are in tier 2, and we are disappointed that central Government have not consulted local leaders, because they would then have been able to investigate the data and, hopefully, show us how we can move into tier 1 from tier 2. Will my right hon. Friend provide some assurances that these conversations will take place with local leaders and confirm that transparent objective criteria will be published for each tier, and how we can slide between each tier?
Matt Hancock
Yes, absolutely—I can give both those assurances. Across Sussex, case rates are at 120. They do need to come down. Like my hon. Friend, I would like to see Sussex get to tier 1 as soon as possible, and we will keep talking to the local area. As I said earlier, all directors of public health have been invited to discussions and consultations with the public health team. That feedback fed into these decisions, but we have to make sure that those conversations continue. The key message to everybody across Sussex and in the Weald, in particular, is that if we all stick together and follow the rules, we know that we can get this virus under control, and that will then lead directly to the lifting of restrictions, which we will regularly review.
Marion Fellows (Motherwell and Wishaw) (SNP) [V]
The Secretary of State will be aware of reports on the Oxford vaccine that the sub-group that suggested 90% effectiveness was due to a manufacturing error, rather than being a planned protocol. It included fewer than 3,000 people and did not have any participants over 55. Does he agree, therefore, that further research is required to verify the efficacy of the lower dose in all age groups before it can be adopted as a standard regimen?
Matt Hancock
Questions over the interpretation of the data in the clinical trials are rightly for the Medicines and Healthcare Products Regulatory Agency, which will assess these clinical trials and will only approve a vaccine for use if it is effective and safe.
Jason McCartney (Colne Valley) (Con) [V]
The first review of Kirklees being in tier 3 will be on 16 December. Will the Secretary of State please confirm that his Department will consult local MPs, council leaders and the local director of public health? Will he publish the full numerical criteria so that we know what we need to achieve to get out of tier 3? Will the Government support Kirklees in delivering mass testing? Finally, will the Secretary of State have a conversation with the Chancellor about delivering extra financial support for our hospitality businesses?
Matt Hancock
I will absolutely take up all those suggestions. We are in discussions with Kirklees about what more we can do, including in the area of large-scale community testing and the other considerations necessary to make that happen.
Carla Lockhart (Upper Bann) (DUP) [V]
The Secretary of State is to be commended for the initiative that he and the Minister for Care have spearheaded to allow close-contact visits between relatives and residents in care home settings. Will the proposed access vary depending on what tier a home is located in? I acknowledge that care is a devolved issue, but with little progress being made in this regard in Northern Ireland, will the Secretary of State undertake to share the experiences of his pilot with the Health Minister in Northern Ireland so that my constituents can also look forward to visiting loved ones as soon as possible?
Matt Hancock
Subject to the results of the pilots, which are ongoing, we hope to allow testing in England to allow for visiting in care homes before Christmas. I will absolutely have another conversation with my opposite number Robin Swann, who is the Health Minister for Northern Ireland. Robin Swann is an excellent Health Minister, we work very closely together, and I am absolutely sure that together we will be able to make progress on testing and other matters. He and I are constantly in touch about how we can best serve the communities of Northern Ireland, from the position of the UK Government’s role in procuring tests around the world and, of course, his vital role in keeping people safe right across the Province.
Madam Deputy Speaker (Dame Eleanor Laing)
I thank the Secretary of State; we have completed our exchanges on the statement.
In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next item of business, I will now the House.
Official Development Assistance
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Foreign, Commonwealth and Development Affairs and First Secretary of State (Dominic Raab)
Madam Deputy Speaker, I will make a statement to the House on official development assistance. The House will know that my right hon. Friend the Chancellor updated the House yesterday on the economic challenges posed by covid-19. It is a truly sobering assessment. The UK is facing the worst economic contraction in almost 300 years and a budget deficit of close to £400 billion—double what we faced in the last financial crisis. Britain is responding to a health emergency, but also an economic emergency, and every penny of public spending will rightly come under intense scrutiny by our constituents.
Given the impact of the global pandemic on the economy and, as a result, the public finances, we have concluded after extensive consideration—and, I have to say, with regret—that we cannot for the moment meet our target of spending 0.7% of gross national income on ODA, and we will move to a target of 0.5% next year. Let me reassure the House that this is a temporary measure. It is a measure we have taken as a matter of necessity, and we will return to 0.7% when the fiscal situation permits.
The relevant legislation, the International Development (Official Development Assistance Target) Act 2015, envisages circumstances in which the 0.7% target may not be met, in particular in the context of economic pressures. The Act provides for accountability to Parliament in that event, and I will of course report to the House in the proper way. Equally, given the requirements of the Act, the fact that we cannot at this moment predict with certainty when the current fiscal circumstances will have sufficiently improved and our need to plan accordingly, we will need to bring forward legislation in due course.
We are not alone in facing these painful choices. All countries are reconciling themselves not just to the health impact of the pandemic, but the economic impact of covid-19. It is worth saying that on the 2019 OECD data, only one other G20 member allocated 0.5% or more of GNI to development spending, and that was before the pandemic. Many countries are reappraising their spending plans, as we have been forced to do. As a result, we nevertheless expect our development spending next year to total around £10 billion, maintaining our status as one of the leading countries in the world in ODA spend.
I can reassure the House that we will retain our position as a leader in the global fight against poverty. We will remain committed to following the rules set by the OECD’s Development Assistance Committee, and we will ensure the maximum impact from our aid through the strategic integration we are driving as a result of the merger at the Foreign, Commonwealth and Development Office, the strategic thinking that is informed by the integrated review, and the further changes we are now making on how we allocate ODA to support a more integrated and overarching approach.
Let me say a little more on that integrated approach. Our starting point is the integrated review, with which we are setting the long-term strategic aims of our international work, based on our values and grounded in the British national interest. To achieve this, we will be taking a far more joined-up approach right across the breadth of government. That is why the Prime Minister created the Foreign, Commonwealth and Development Office, bringing diplomacy and development together, in lockstep with the work of our other Departments. ODA is a vital, central and absolutely indispensable element of that strategic approach, but to maximise its effectiveness it must be used in combination with our development policy expertise, our security deployments and support abroad, and the strengthened global co-operation that we drive through our diplomatic network. We make our aid go further by bringing it together with all these other elements, and by making sure that they are all aligned and pushing in the same direction.
Last week, the Prime Minister set out how we are strengthening our defence and security capabilities. That will boost our standing in the world, while also contributing to our development efforts, including our soft power abroad. The clearest illustration of that is the peacekeeping that we do. We have British troop deployments in Afghanistan, South Sudan, Somalia, the Democratic Republic of the Congo and elsewhere, which work hand in hand with our development and diplomatic efforts. Indeed, we are demonstrating that with our latest deployment of 300 UK troops to Mali. Our security and defence budget also helps countries to deal with new, emerging and evolving threats, for example, in supporting Nigeria and Kenya to assess and strengthen their cyber-security resilience. We will set out the full detail of the integrated review early in the new year, as we launch our presidencies of the G7 and COP26, with 2021 a year of leadership for global Britain as a force for good in the world.
This new strategic approach will allow us to drive greater impact from our £10 billion of ODA spending next year, notwithstanding the very difficult financial pressures we face. I will prioritise that £10 billion of spending in five particular ways. First, we will prioritise measures to tackle climate change, protect biodiversity and finance low-carbon and climate-resilient technologies, such as solar and wind, in poor and emerging economies. I can reassure the House that we will maintain our commitment to double international climate finance, which is vital to maintain our ambitions in this area as we host COP26. We will leverage our aid support through our diplomatic network, to galvanise global action and to make sure that countries come forward with ambitious, game-changing commitments in the lead-up to November next year.
Secondly, we will prioritise measures to tackle covid, and promote wider international health security. We will maintain our position as a world leader, investing in Gavi the Vaccine Alliance, COVAX, the Global Fund to Fight AIDS, Tuberculosis and Malaria, and the International Finance Facility for Immunisation. We will continue to support and strengthen the World Health Organisation, as the second largest state donor; I spoke to Dr Tedros just yesterday about our efforts in that regard. We will also use all of our other levers to maximise British impact. For example, we have magnified our COVAX contribution through our diplomatic efforts, which helped to convince the board of the World Bank to announce additional funding last month of up to $12 billion for covid vaccines, tests and treatments. Again, I spoke to World Bank president David Malpass just last night about our important collaboration in that area.
Thirdly, we continue to prioritise girls’ education, because it is the right thing to do and because the fortunes of so many of the poorest countries depend on tapping the full potential of all their people, which must include women and girls in education. Our global target, working with our partners, is to get 40 million girls into education and have 20 million more girls reading by the age of 10. It is a major priority for global Britain as a leading supporter of the Global Partnership for Education, and just next year we will raise $4 billion globally, including through our UK-Kenya summit.
Fourthly, we will focus ODA on resolving conflicts, alleviating humanitarian crises, defending open societies, and promoting trade and investment, including by increasing UK partnerships in science research and technology, because these are the building blocks of development and they require a long-term strategic commitment.
Finally, at all times we will look to improve our delivery of aid in order to increase the impact that our policy interventions have on the ground, in the countries and the communities that they are designed to benefit and help. We will strengthen accountability and value for money, reducing reliance on expensive consultants for project management and strengthening our in-house capability to give us more direct oversight and control, including by removing the total operating cost limits that were introduced when the Department for International Development was established—a limit that applied only to DFID.
As a result of this spending review, the FCDO will take on a greater role in ensuring the coherence and co-ordination of development-related spending right across Whitehall. To maximise the strategic focus that I have talked about, I will run a short cross-Government process to review, appraise and finalise all the UK’s ODA allocations for next year in the lead-up to Christmas.
This is a moment of unprecedented challenge. On all sides of the House, we are defined by our willingness to make the difficult choices, not just the easy ones. With the approach that I have set out, we will maintain our international ambition. We will deliver greater impact from our aid budget at a time of unparalleled financial pressure.
Like many in the House, I am proud of our aid spend. I am proud of the big-hearted generosity of the British public, which we amplify with our diplomatic energy on the world stage. I am proud of the huge amount we do to support the poorest and the most vulnerable, right around the world. The United Kingdom is out there every single day—our people on the ground in the disaster zones, in the refugee camps, tackling famine and drought, helping lift people out of poverty, striving to resolve conflicts and striving to build a more hopeful future for the millions of people struggling and striving against the odds. Even in the toughest economic times, we will continue that mission. We will continue to lead. I commend this statement to the House.
Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)
Last week, the Prime Minister promised to end an era of retreat, yet today signals the biggest retreat by a British Government from our global role in decades. They have removed any credibility the UK has as a force for good in the world, and made it harder for us to pursue our national interest and create a safer, healthier, fairer and better world for us all. Make no mistake, our traditional allies and our detractors will take note of this move.
This Government have destroyed the long-standing cross-party support for spending 0.7% of GNI to eradicate global poverty and reneged on their promise to the British people, breaking a manifesto commitment and turning their back on all those they promised to champion: mothers, new-born babies and children who are dying from preventable causes, the tens of millions of girls who are out of school, and those whose lives and livelihoods have been destroyed by Ebola and malaria.
Britain and the world deserve better than a Foreign Secretary who has allowed the aid budget to be slashed, leaving our global reputation lying in tatters ahead of a year when the UK hosts the G7 and COP26. We know that we need a dramatic acceleration in the pace and scale of global climate action, and we all want the UN climate conference to be a success, but for that to happen we must harness the political will of other countries. As host, it falls to the UK to lead by example, not withdraw, yet cutting the aid budget does exactly that and has already attracted outspoken criticism from vital partners. I pity the Foreign Secretary having to explain to his counterparts that this is all part of his and the Prime Minister’s idea of “Global Britain”.
This Government have repeatedly delayed their review of foreign policy, with announcements being made on a whim. It is a disintegrated review. Do the Government actually have a strategy, a plan or even a vague idea? I have lost track of the number of times the Secretary of State has announced new development priorities, so perhaps he can confirm how long he will stick with these. Under the Conservatives, foreign aid has been diverted away from the world’s poorest. Will he now ensure that it is not squandered on vanity projects but instead focused on eradicating poverty and inequality?
In the year since the Conservatives pledged in their manifesto to “proudly” uphold the law to spend 0.7% of GNI on aid, we have been told by the Prime Minister that spending 0.7% of GNI was
“a goal…that remains our commitment.”—[Official Report, 16 June 2020; Vol. 677, c. 667.]
The Secretary of State has said that the commitment “is written in law,” and will be
“the beating heart of our foreign policy”.—[Official Report, 18 June 2020; Vol. 677, c. 945.]
His Ministers, the right hon. Member for Braintree (James Cleverly) and the hon. Member for Rochford and Southend East (James Duddridge), have told us, respectively, that
“the Government are completely committed to the 0.7% target…because it is the right thing to do.”—[Official Report, 9 July 2020; Vol. 678, c. 1198-1200.]
and:
“We are bound by law to spend 0.7%, so it is not a choice; it is in the law, and we will obey the law.”—[Official Report, 30 June 2020; Vol. 678, c. 147.]
Now they have decided they do not actually like obeying the law.
This Government are developing a reputation, and many within the Secretary of State’s own party do not like what they see. Yesterday, his own Minister, Baroness Sugg, resigned because abandoning our commitment
“risks undermining…efforts to promote a Global Britain”.
I stand ready to work with her, with the hon. Members for Mid Derbyshire (Mrs Latham) and for West Worcestershire (Harriett Baldwin), the right hon. Members for Preseli Pembrokeshire (Stephen Crabb), for Sutton Coldfield (Mr Mitchell), for Ashford (Damian Green) and for South West Surrey (Jeremy Hunt), the hon. Member for Wyre Forest (Mark Garnier), the Chairs of the Defence and Foreign Affairs Committees—the right hon. Member for Bournemouth East (Mr Ellwood) and the hon. Member for Tonbridge and Malling (Tom Tugendhat)—the Father of the House, and many more who I do not have time to list, to stop this retreat. Can the Secretary of State tell us when the necessary legislation will be brought forward? Can he confirm that he will spend 0.7% of GNI on aid this year and what the estimated value of ODA will be?
This Government love to blame others for their shortcomings, especially when they cannot answer back. Rather than taking responsibility for their incompetence, spending £12 billion on a covid test and trace scheme that still is not working and wasting taxpayers’ money on over 184 million items of unusable personal protective equipment, this Government have chosen to make the world’s poorest pay for their failures.
The British people are extremely compassionate. They have seen a global health crisis cause devastation around the world and push millions of people into poverty, costing lives and livelihoods. They know that this is not a necessity but a political choice that this Government have made. We stand with them and oppose this ill-conceived, short-sighted decision.
Dominic Raab
Well, where to start with that?
The hon. Lady referred to a range of different issues. She referred to the UK’s work on disease and girls’ education. We entirely agree. These are total priorities, and that is why I set out the priorities—I appreciate that her response was written before she listened to what I said—so that I could give her and the House the reassurance that actually those are two areas that we will safeguard and prioritise. [Interruption.] No, we said we will safeguard those priorities.
The hon. Lady asked about climate change. As I made clear, our first priority will be to prioritise measures to tackle climate change and protect biodiversity, and we will maintain our commitment to double the international climate finance, which I agree is very important as we go into COP26.
The hon. Lady asked about our international partners. Of course our international partners, whether they are non-governmental organisations or the heads of the international organisations, will want as much generosity as possible. We understand that. I spoke to the Secretary-General of the United Nations, the president of the World Bank, and Dr Tedros at the World Health Organisation yesterday. They understand the financial challenges and the health challenges, and they know that we will be a stalwart, leading member of the international community as a force for good in the world, notwithstanding the pressure that we and many others will now face.
The hon. Lady asked about the legislation. We will bring that forward in due course. Obviously we want to make sure that it is as well prepared and carefully thought through as possible. [Interruption.] She says that we do not have to. On the one hand, she has said that we are breaking the law and changing our mind on the law—[Interruption.] It is very clear under the legislation. She should go and check—
Dominic Raab
The hon. Gentleman says that it is temporary. That is not what the legislation says: he should go and look at it very carefully. [Interruption.] Well, he has not got this quite right. We have taken advice very carefully on this, and it is very clear that if we cannot see a path back to 0.7% in the foreseeable, immediate future, and we cannot plan for that, then the legislation would require us to change it. We would almost certainly face legal challenge if we do not very carefully follow it.
On the hon. Lady’s question about the 0.7%, it will still apply this year.
The hon. Lady criticises the Government for the choices that we have had to make in the face of a global pandemic and a financial emergency. It is not clear to me what choices Labour would make or that she would make. [Interruption.] Was she suggesting that we cut the money—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. Members are talking over the Secretary of State.
Dominic Raab
Thank you, Madam Deputy Speaker. Was the hon. Lady suggesting that we divert money from test and trace at this pivotal moment in the pandemic to meet 0.7%? Is she suggesting that any of the extra investment in schools, hospitals and policing announced yesterday should be cut in order to meet 0.7%? [Interruption.] She is shaking her head. In fairness to her, she has previously said that ODA should be cut because of the impact on the economy. She said it in the context of the GNI review that we conducted. Because she is shaking her head, I will quote her verbatim, to be accurate:
“we recognise that there has got to be cuts made…we’ve had a drop in GNI…those cuts shouldn’t come from DFID”
but should come from
“other government departments’”
spending on ODA. [Interruption.] The hon. Lady says, “Yes, yes, yes”—so does she advocate cutting the amount of ODA that the Department for Business, Energy and Industrial Strategy and the Department for Environment, Food and Rural Affairs spend on climate change? [Interruption.] Again, we come back to the basic point that, given the financial pressures that we face, difficult decisions need to be made. [Interruption.]
Madam Deputy Speaker
Order. It is fine for the Secretary of State to ask a rhetorical question. It is not in order to have a dialogue from a sedentary position. A rhetorical question does not require an immediate answer.
Dominic Raab
The truth is that, in this spending review, the Labour party is defined by its total inertia in the face of the difficult decisions we have had to make. I am afraid that that gives it very little credibility when it comes to the SR.
When it comes to 0.7%, the House should recall that the Labour party has history on this. Members across the House, particularly the more long-standing ones, will remember that it was a Labour Government under Harold Wilson back in 1974—the year I was born—who first set the target of 0.7%. In the 46 years since—the whole of my lifetime—no Labour Government have ever hit 0.7%; not in a single year.
The hon. Lady talked in hyperbolic language about the damage that we will do with a shift to 0.5% and a £10 billion ODA budget. May I remind her that in the 13 years of the last Labour Government, not only did they never once hit 0.7% in any year—[Interruption.] The hon. Member for Cardiff South and Penarth (Stephen Doughty) does not like it. I will come to him in a second. The last Labour Government only ever hit 0.5% in two years out of 13.
The House need not take my word for it. The shadow Africa Minister, the hon. Member for Cardiff South and Penarth, was a Spad in DFID under the last Labour Government—
Dominic Raab
The hon. Gentleman says that it went up. That Government spent, on average, 0.36% of GNI on ODA. With a record like that, the hon. Gentleman, rather than chuntering from a sedentary position, should stay quiet on this subject. On the Government Benches, with our record, we will take no lectures from the Labour party when it comes to ODA.
Tom Tugendhat (Tonbridge and Malling) (Con)
It feels almost rude to interrupt a private dialogue. I understand the pain that this economic collapse is causing all of us. I have just received the appalling news that the whole of Kent has gone into tier 3, and I am aware of the pain that this will cause communities across my constituency.
I supported the Foreign Secretary taking over the DFID portfolio because I knew that the rigour he would bring to ODA spending would mean that it was always in the British national interest. Indeed, the way he has spoken about it this morning reassures me of that. He has spoken quite rightly about girls’ education, not just because it is good for girls in other parts of the world but because it is good for Britain. He has spoken about climate change, not just because it is good for the poorest and most low-lying countries around the world but because it is good for Britain. He has spoken about vaccination, not just because it is most important for the most vulnerable in the world, but again, because it is good for Britain. So does he understand why so many of us are disappointed that, knowing how well he will spend this money, not only in the interests of others but in the British national interest, we hear that it has been cut? I am sure that he feels that, too.
Could I perhaps ask the Foreign Secretary to look at a slightly different way of counting, because we all know that the 1970s DAC rules need to be reformed? I am not alone in saying this. The French Government have said it; the Netherlands Government have said it; and the German Government have said it. In fact, I think that I am right in saying that everybody, except the Swedish Government, has said it. Could we not count the enormous sums that he is already spending on vaccination programmes through the vaccine taskforce and the enormous money he is spending on UN duties—not just the 15% that DAC allows him to count—and could we not count that stability as our ODA capability and reinforce what he has done? Then perhaps we can look at the Bill he may be forced to introduce and make sure that it is not an open-ended Bill but has a sunset clause in black and white that we can vote on, too.
Dominic Raab
I thank my hon. Friend the Chair of the Foreign Affairs Committee. He is absolutely right, and he said it at the outset: we make this decision with regret. I do not want to be in a position of having to change any of the ODA spend. I know how valuable it can be and, notwithstanding our absolute commitment to strategically focus it on the places and people who need it the most and the areas of maximum UK interest, of course this is something we do with regret. We do it as a matter of necessity, given the economic situation we face, and it will be temporary, in that we will revert to 0.7% as soon as the fiscal position allows.
My hon. Friend asked a range of questions about whether we could reconfigure money. We are not going to unilaterally pull out of the DAC rules, but he makes a good case for reform of the DAC rules. For example, some of the military spend, particularly on peace keeping and other things, is not counted. Clearly, it is not just good for military security in the countries where it is focused but an important element of soft power, and it is something we should do. However, I think that the right thing to do is to work on that reform from within DAC, rather than pulling out unilaterally, and that will take some time to do, but I take on board his comments.
My hon. Friend asked how we will make sure we get back to the target, and I am very happy to keep talking to him about that. The No. 1 thing in my view, and I would gently suggest this to him, is that we are still spending £10 billion next year on ODA. When I think of what he said about his constituents and how they will feel about the latest measures—we all are challenged by this—I think that they will think that we are making difficult decisions, but the right ones and the justifiable ones, in the very exacting situation in which we find ourselves.
Alyn Smith (Stirling) (SNP)
To govern is to choose. As one Government to another—of course, the SNP has been in government since 2007—we understand that it is difficult. We are in unprecedented times; there are tough choices; and a lot of people are afraid and feeling very vulnerable. However, there will always be domestic pressure on the aid budget, and the UK Government have made a choice—an active choice—of deep consequence.
The fact is that this is not what was promised. This is not what was promised to the people of Scotland in 2014. This is not what was promised in the Conservative manifesto 11 months ago. The Foreign Secretary talks about scrutiny of spend, and I absolutely agree, but my inbox—I dare say colleagues feel the same—is unanimous this morning against this move. It is fair to say that in Scotland we have a disproportionate interest in international development, because of the history we have with our churches, our non-governmental organisations, our trade unions and our universities. Civic Scotland is keen on international development, and DFID—now merged, of course, into the FCDO—is based in East Kilbride. This is a betrayal: not just a betrayal of those promises, but a betrayal of some of the poorest and most vulnerable people in the world, who are also facing covid, the economic consequences and climate change, and they are going to be left by this in a dreadful situation.
When I say it is a betrayal, I would actually exempt the Foreign Secretary from that. I do not think that this is coming from him. I do not think that he has stopped it, but I do not think it is actually coming from him. I think that it is coming from the people around him and behind him. They are the people in the shadows, with their phoney think-tanks and their blogs. They are the people who proudly denigrate international aid because it is against their project and the people who want to link international aid to trade policy in the most grubby way possible. They are the people who get excited about a red, white and blue flag on a tail fin, and the people who think that what we need right now to buoy our spirits is a new royal yacht. They are the people who want to spend, as the Government have committed to doing, £120 million on a festival of Brexit—ye Gods!
We have today a moment of real clarity and divergence—that Scotland and the UK are two different places with two different ambitions on two different paths. It is a matter of fact that the cynics were right. After the UK’s politicisation of aid by merging DFID into the FCDO, there has been a crippling raid on its budget. DFID in East Kilbride is a deeply sad place this morning. Scotland independent—because of our interests, our history, our capacity and our ambition—will put international development at its heart. We will be committed to 0.7%, and it is clearer than ever today to the people of Scotland that the best way to achieve that aid policy, to be that global citizen, is independence.
Dominic Raab
First, may I say in relation to East Kilbride, and notwithstanding the pressures we face, we will be expanding the UK Government Foreign, Commonwealth and Development Office in East Kilbride because we know the great work that it does and because we are stronger on the international stage when we are united?
The hon. Gentleman said that this decision was not what was promised in 2014 or at the last election. I hesitate to remind him that that was before the pandemic and the coronavirus, and before we were faced with—[Interruption.] Well, he is quite right to say that there are always domestic pressures and competing priorities in relation to the public finances, but we are not under any normal set of circumstances. We have got the worst economic contraction in over 300 years. We have a deficit double the size that we faced after the last financial crash, and we are having to make very difficult decisions. If he thinks we have made the wrong decision, I would like to hear from the SNP—a rhetorical, not an actual question—what he thinks should be cut in the investments the Chancellor announced yesterday in order to hit 0.7%.
The hon. Gentleman referred—in what I thought was actually pretty unsavoury language—to a crippling raid on ODA. We will spend £10 billion next year. His inbox may be different from mine, but I think our constituents will understand, because they live in the real world, that we have to make difficult decisions. This is still an extraordinary contribution that the taxpayers of this country will make to alleviate suffering and poverty around the world.
Sir Peter Bottomley (Worthing West) (Con)
May I suggest that we squint at the nettles in what was said yesterday and what has been said today? Clearly, it would be illuminating to see the messages that the Foreign Secretary will have sent to the Treasury and the Prime Minister arguing against the cut. We know that this is not his idea.
May I ask the Foreign Secretary how much the amount of money would have gone down if we had kept 0.7% with an 11% contraction of the economy? Is that well over £1 billion? How much extra is being taken by coming down from 0.7%? Is the proposed legislation designed to make sure we come back to 0.7% or to make it possible to avoid coming back to it for a long time?
I end by saying that I first stood for election when the Foreign Secretary was born, and I became a trustee of Christian Aid to fight to get the Government to meet the commitment they had made a long time before to 0.7%. I rejoiced when we met it. It was not put on us by the Liberal Democrats; it was in our manifesto in 2010. I am glad that the Foreign Secretary was able to say in July that we would stick to 0.7%.
Dominic Raab
I thank my hon. Friend. He will be able to work out that the difference is £4 billion in savings next year. Of course we looked at whether we could just follow the contraction in GNI to deliver the savings that we need. We looked at every single option, but the challenge we have is that the pandemic is uncertain. That is what we found in the throes of coming out of the second national lockdown. As a result, the impact on the economy and the public finances is not just profound but also uncertain.
My hon. Friend asked some further questions about our seriousness in getting back to 0.7%. We are serious. He is right to say that it was a manifesto commitment that we were proud of, but I think that the country expects us to stand up and make difficult decisions, given the necessity of the situation that we face. We have made it clear that it is temporary, and we will get back to it just as soon as the public finances allow.
Sarah Champion (Rotherham) (Lab) [V]
In the past six months, the Foreign Secretary has closed DFID, tried to abolish the Select Committee on International Development and cut more than a third of the aid budget. We still have no clarity on where those cuts have been or will be made, or their consequences. I have specific concerns about some of the areas that he details as priorities, as they might fall outside the ODA definition. The science element is written to fit the heavily criticised Newton Fund, and the trade aspect could lead to tied aid. In his letter to me, he states that
“too often, aid has lacked coherence, oversight or appropriate accountability across Whitehall.”
The same could be said in relation to Parliament. To address that, will he agree to present to the House an impact assessment of the cuts? Will he also agree to support the International Development Committee’s change of remit, so that we can scrutinise all ODA, so that both taxpayers and Members of Parliament may be assured that the money is being well spent?
Dominic Raab
I have to say to the hon. Lady, whom I respect and admire greatly, that we have not closed DFID, but merged the Foreign Office and DFID, precisely to give greater impact given the financial pressures we now face. She asked about tied aid; we are not suggesting any reversion to tied aid, which comes from a bygone era and is not something that I or this Government support. Nor have we tried to abolish the Select Committee; I have made it clear every time I have been asked, such matters are for the House to decide. Finally, she asked about when we will publish the GNI review detailed breakdown. Obviously, we are committed to full transparency, and the statistics on international development are published next year. They will be provided through a detailed breakdown of all the ODA allocations in 2020.
Anne-Marie Trevelyan (Berwick-upon-Tweed) (Con) [V]
I thank the Foreign Secretary for his statement. The Chancellor’s statement yesterday setting out plans to amend the International Development (Official Development Assistance Target) Act 2015 and to reduce ODA spending for the next few years is profoundly upsetting to many, as it suggests that the UK is stepping back from its world-class, globally respected and unstinting commitment to supporting developing countries. I know that that anxiety is unfounded.
Does the Foreign Secretary agree that, while the silo budgets classified as ODA will be squeezed, we should take the opportunity that the global financial crisis has forced on everyone—as the Chair of the Foreign Affairs Committee, my hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) set out—to review fully the DAC rules on which we classify our ODA spending? In the meantime, will the Foreign Secretary make it clear to the House that all Government spending that works to strengthen the stability, governance, health, education—and I take this opportunity to thank Baroness Sugg for her extraordinary work over the past year on girls’ education—and climate shock resilience of developing countries supports all the sustainable development goals? Will he commit to review the historical multilateral payments commitments, which could be used much more impactfully to drive the UK’s priorities?
Dominic Raab
I join my right hon. Friend in paying tribute to Baroness Sugg, a terrific Minister who will be greatly missed. I congratulate my right hon. Friend on her appointment as the UK’s international champion on various climate change issues. With her expertise, passion and dedication, she makes an excellent case for taking a more strategic approach, not only in relation to the ODA spend that derives from the FCDO, but looking right across the piece, across Whitehall, to ensure that it is allocated in the areas where it has the greatest life-changing impact. We will do that on climate change and biodiversity, and on girls’ education and helping the very poorest around the world.
Hilary Benn (Leeds Central) (Lab)
For the record, the ODA GNI figure in 2010, the last year of the previous Labour Government, was 0.57%.
May I say to the Foreign Secretary that of all the promises that our country has made, to choose to break this promise to the world’s poorest people, is unforgivable? We are talking about a cut of roughly one third in the aid budget. The thought that some babies might not be delivered safely, or some children might not be able to go to school or be vaccinated so that they do not die of the diseases that our children do not die of, should trouble every single one of us.
The Foreign Secretary said that he intends to make decisions about where the reductions will fall before Christmas. Will he assure the House that the decision on whether that will go ahead will be brought to Parliament, so that we can decide whether to break our promise or, instead, to keep our word?
Dominic Raab
May I thank the right hon. Gentleman? I know that he cares about this subject passionately and served as International Development Secretary himself. Frankly, he used rather hyperbolic language, but he should have at least noted the reassurance that I gave about strategic prioritisation—even with a reduced financial envelope—and our commitment regarding disease, particularly immunisation and vaccination around tuberculosis, covid, malaria and the like. He mentioned schools, and he will have noted that I said we would be safeguarding girls’ education. He wanted to trade figures with me, so I hope that he will bear with me: when he became Development Secretary in 2003, ODA spend was 0.34% of GNI; and when he left in 2007, it was 0.36%. The Conservatives are the ones who hit 0.7%, and we are proud of that. We will go to 0.5% next year. I think I am right in saying that the last Labour Government hit 0.5% in only one year of his tenure as Development Secretary, so he should have just a little bit more humility when he engages in quite such hyperbolic critique of what we have achieved on this side of the House.
Mr Andrew Mitchell (Sutton Coldfield) (Con)
I thank the Foreign Secretary very much for his courtesy over recent months, for his extremely welcome support for the Independent Commission for Aid Impact, and for his kind comments about Lady Sugg, who was a brilliant Development Minister. I hope that everyone in the House will read her principled and moving resignation letter, which she released yesterday.
My right hon. Friend and I both know that, seen from the Biden White House, this is a dismal start to our G7 chairmanship. As the former Prime Minister said yesterday, the 0.7% is a promise that we as Tories do not need to break. My right hon. Friend knows, does he not, that taking a further 30% out of the development budget will drive a horse and cart through many of the plans that the British Government have so strongly supported for eliminating poverty. It will withdraw access to family planning and contraception for more than 7 million women, with all the misery that that will entail; 100,000 children will die from preventable diseases; and 2 million people—mainly children—will suffer much more steeply from malnutrition and starvation as a result of these changes. In spite of what he says about prioritising girls’ education, which is extremely welcome, under the existing plans probably 1 million girls will not be able to go to school. I hope that he will bear in mind that these reductions make little difference to us in the United Kingdom, but they make a massive difference to them.
Dominic Raab
I pay tribute to my right hon. Friend, who was a fantastic Development Secretary. We have talked at length about these issues since our time in opposition, and will continue to do so. He mentioned a number of points. He read out some statistics. With respect, I do not think it is possible to talk with the precision that he did about the implications, because we are not going to take a salami-slicing approach and just say, “We’re going to cut a third from all areas of ODA.” That is not what we are going to do. We are going to take a strategic approach. We will safeguard those areas that we regard as an absolute priority, including many of the things he mentioned, particularly public health and international public health, alongside covid, climate change and girls’ education.
My right hon. Friend talked about ICAI. As he knows, I am committed to reinforcing ICAI’s role; we welcome the transparency and scrutiny. Finally, he talked about the US. With respect, I disagree. At 0.5% next year, we will still be spending a greater proportion of GNI than the US. Given the widespread cross-party concerns in the US about defence spending within the European context, I think they will welcome the fact that we are increasing our security and defence budget.
Peter Kyle (Hove) (Lab)
If, during a global pandemic, the Government do not accept that solving problems abroad before they reach our shores is worth doing, this is an argument we are never going to win. There has been a year-on-year reduction in deaths from terrorism and extremism from countries where we have been investing huge amounts of development resources. Now that we are withdrawing that resource, the opposite will happen. This is also an economic argument, because where we have to use the military to respond to extremism, civil strife and the breakdown of law and order, we put British armed forces—our service people—in danger, we spend an absolute fortune and Britain ends up paying a very high price for our credibility. Does the Foreign Secretary not accept that when we withdraw international development aid and resource, we will end up paying far, far more by using the military in the long term? This is an economic and a military argument.
Madam Deputy Speaker (Dame Eleanor Laing)
Before the Foreign Secretary answers that question, I must point out to the House that when a Minister makes a statement, the idea is that people ask short questions. They are not meant to be making speeches. A question is one phrase with a question mark at the end. It does not require lots of statistics, a huge preamble or lots of rhetoric. We are only a quarter of the way through the list of people who have asked to speak in this statement, but we have used up three quarters of the hour allocated to it. That simply is not fair to the other people who have yet to ask their questions, so I beg for short questions—and if the questions are short, it will be easier for the Foreign Secretary to give shorter answers.
Dominic Raab
I will take that encouragement, Madam Deputy Speaker. The hon. Gentleman asked about two things. I accept the premise that our security is strengthened by the action we take abroad, although of course that includes the reverse proposition, which is that our defence and security spend abroad—including some of the stuff that is covered by ODA and some of the stuff that is not—also has a soft power impact. I mentioned cyber earlier. The creation of the new National Cyber Force and artificial intelligence agency is important to protect us here but it will also reinforce the capabilities of our most vulnerable partners abroad. The hon. Gentleman also mentioned health. I have explained at some length why we will be safeguarding and prioritising our international public health spending.
Stephen Metcalfe (South Basildon and East Thurrock) (Con) [V]
I thank my right hon. Friend for his statement. While I am a supporter of our 0.7% commitment, I understand that in these difficult times tough decisions have to be made. Will he therefore again confirm that it is the Government’s intention to return to 0.7% when the situation allows? Will he also join me in reminding the House that while the Opposition are expressing outrage, the Labour Government never hit 0.7%? Our 0.5% will stand very well in comparison.
Dominic Raab
My hon. Friend is absolutely right. Labour barely hit 0.5%, let alone 0.7%. I accept that there is cross-party concern about this challenging set of circumstances and these difficult decisions. The difference is that we are making these difficult decisions and we are being honest and upfront with the British public about it.
Layla Moran (Oxford West and Abingdon) (LD) [V]
The proposed cut in aid spending, breaking our nation’s promise to the world’s poorest, is not just callous and unnecessary but entirely against our own self-interest. We are currently an aid superpower, and this move undermines the soft power we so desperately need in the post-Brexit era. I and the Liberal Democrats will join all others across the House to fight this short-sighted move. The Foreign Secretary says he is doing this with regret, and I believe him, but does he accept that in a few years he may well regret what he is doing?
Dominic Raab
I share the hon. Lady’s passion and her commitment to the role that ODA plays in our soft power abroad. I gently remind her that, at 0.5%, we will still be on the 2019 figures and the second biggest ODA spender. I just ask her, as we ask all the other parties and all hon. Members, whether she can explain how else she would deal with the financial emergency that we now face, because I have not heard a peep of other positive, credible alternatives from the Lib Dems, let alone from the Labour Benches.
Jerome Mayhew (Broadland) (Con)
One of the most shocking parts of the Chancellor’s statement yesterday was that we will borrow £396 billion this year alone, with a further £369 billion to come by 2023. Given the truly parlous state of our public finances, does my right hon. Friend agree that the temporary cut to our foreign aid budget, deeply regrettable as it is, is a necessary reflection of our altered circumstances and is needed, frankly, to keep our aid spending in line with our taxpayers’ priorities?
Dominic Raab
As the Chancellor said at the Dispatch Box yesterday, and notwithstanding the regret and the financial pressures, it would be difficult to justify to our constituents, with all that they are going through and all that they expect of what we do domestically, if we were not looking at every area, including this area, to try and see our way through. However, as he rightly said, it is temporary, and we will get back to 0.7% when the financial conditions allow.
Madam Deputy Speaker (Dame Eleanor Laing)
We now have audio link only, as there is a problem with the proper link, to Margaret Ferrier.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind) [V]
Thank you, Madam Speaker.
“International aid saves lives. It supports the world’s most fragile and it gives the world hope.”
Those are not my words, but the words of just one of many constituents who have contacted me to express their anger and sadness at the decision to reduce the international aid budget to 0.5% of GDP. Has the Foreign Secretary carried out an impact assessment identifying how many lives could be lost as a result of slashing assistance to some of the world’s poorest countries?
Dominic Raab
We will still be spending £10 billion next year. I will run an allocation process that allows all the other Departments that bid for aspects of ODA to scrutinise these things very carefully to mitigate precisely the risks that the hon. Lady talked about.
Dr Kieran Mullan (Crewe and Nantwich) (Con)
I deeply respect arguments against this decision, but will the Foreign Secretary agree that to describe the enormous amounts of taxpayers’ money we will continue to spend as “dismal”, “unforgivable” and some of the other things we have heard today actually damages public support for this cause in the long run?
Dominic Raab
I think my hon. Friend has a point about the way our constituents will view the decisions that we take. We need to make sure that everything we do on our aid budget, development and our foreign policy abroad attracts and commands their confidence. If we somehow immunised our ODA budget, in a way that no other budget domestically has been immunised, I think they would ask questions, if not be very concerned by that approach, so I think my hon. Friend is right.
Carla Lockhart (Upper Bann) (DUP) [V]
In the light of the announced reduction in the aid budget, will the Foreign Secretary commit to ensuring that aid will be focused on areas of utmost need, such as tackling the systemic issues and cultures of impunity, which enable modern slavery and violence to affect the world’s poorest people?
Dominic Raab
The hon. Lady is absolutely right. I have set out the list of priorities, including conflict prevention, promoting accountability in countries and dealing with violence—particularly violence against women, but all violence against civilians in conflict situations. We will run the allocation process to make sure that we safeguard our top priorities, which include those that she mentioned, as best we can in the reduced financial envelope that we face.
Karl MᶜCartney (Lincoln) (Con) [V]
I understand the difficult financial decisions that we as a Government have had to make at this unprecedented time. However, I know that all Conservative Members will agree that we need to ensure our foreign aid is targeted to the most vulnerable in the world. When the Independent Commission for Aid Impact report is published later this year, will my right hon. Friend come back to the House and update right hon. and hon. Members on exactly how we can target our support better to ensure it reaches the world’s most vulnerable?
Dominic Raab
My hon. Friend is right, and he will recall that I said back in August that we wanted to reinforce, not undermine, the role of the Independent Commission for Aid Impact to strengthen the transparency, reinforce the accountability and make sure that we get the very best critical analysis of where we have the most impact. As soon as the review is finalised, copies will be placed in the Libraries of the House and shared with Select Committees, and I will make a statement to the House.
Geraint Davies (Swansea West) (Lab/Co-op) [V]
The Foreign Secretary says that this cut is both temporary and a matter of necessity. Although borrowing is up, the overall cost of borrowing has fallen because of falling interest rates, yet the poorest countries are not able to respond to the economic consequences of covid in this way, as richer countries can. As we are the global host of the G7, the UN Security Council and COP26, will he press the Chancellor to lead by example for global Britain, particularly in relation to the new US Biden Administration, and to leverage more funds from the US as well, so the poorer nations get the best deal in the worst year—next year, of all years, when it will be needed most?
Dominic Raab
The hon. Gentleman makes an excellent point, which is that we are facing acute difficulties, and we are very concerned about what that will mean for the most vulnerable countries, both on health grounds and financial grounds. We have a direct stake in that, as well as a moral responsibility, and in everything we are doing—from International Monetary Fund debt relief to World Bank projects and, indeed, the allocation review that I have already mentioned to the House—we will safeguard the £10 billion to make sure it is focused on shoring up the poorer countries, the most vulnerable countries, as they come through this pandemic.
Henry Smith (Crawley) (Con) [V]
As a member of the International Development Select Committee during the previous Parliament, I quite understand the need for the UK to live within its means in these exceptional circumstances, and I welcome the fact that we are still spending more of our gross national income on development than the vast majority of other countries. However, can I have an assurance from the Secretary of State that no more UK aid will go to China—a country that is, in effect, developed, and of course one that has a very poor human rights record?
Dominic Raab
My hon. Friend may know that we ended bilateral aid to China in 2011. There is, though, still a case for some collaboration in the development space with China, and the example I tend to give is climate change. Yes, China is the biggest net emitter, but it is also the biggest investor in renewables, and even with all the other challenges we have with China, that is an area in which we want to try to work and engage positively.
Richard Thomson (Gordon) (SNP)
Over the past few weeks, the UK Government have threatened to break international law, and are now retreating from pledges given both domestically and internationally to support some of the world’s most vulnerable people at a time of unprecedented global crisis. I wonder whether the Foreign Secretary can really be content with the way his Government’s policy is undermining the UK’s international standing and claims to global leadership, and seeing them shrivel so miserably on his watch.
Dominic Raab
The wonderful thing about this job is that when I travel abroad, I realise the high esteem in which we in the United Kingdom are held, not just for our democracy and our way of life, but for the contribution we make. I hear that from both sides of the aisle in the United States, and there is lots of talk from President-elect Biden about the renewed approach to multilateralism. I have heard it in the calls I have made, from Dr Tedros, from David Malpass at the World Bank, and indeed from António Guterres. If the hon. Gentleman encourages me to look at the United Kingdom in the way that others do, I would point him to the Ipsos Mori surveys carried out by the British Council, which showed that particularly among young people around the world, we are rated as the most attractive country, with the highest trust—alongside Canada—in our institutions.
Theo Clarke (Stafford) (Con) [V]
As a long-term supporter of our global Britain agenda, of which aid is a key part, I am deeply concerned by yesterday’s announcement that we will not be keeping to 0.7% next year. I appreciate the difficult economic decisions this Government have had to make because of the coronavirus pandemic, but given that the 0.7% target is also a manifesto commitment, can my right hon. Friend confirm to me that this fall to 0.5% is only temporary? I also note that the Government have said we will return to 0.7%
“when the fiscal situation allows.”—[Official Report, 25 November 2020; Vol. 684, c. 850.]
What exactly does that mean, and can my right hon. Friend set out the steps that the Government will take to return us to that aid target?
Dominic Raab
I pay tribute to my hon. Friend for the enormous expertise and experience she brings to the House from the development sphere. I can confirm that it will be temporary and, as I have already said, it is done as a matter of necessity and with regret. She asks what steps we will take. The most important thing is that we will need to see the impact of the virus on the economy and then on the public finances. We have come through what is effectively a second wave. We need to shore up against that. The measures the Government have announced aim to do that.
We are hopeful about a vaccine for next year, but we have to be cautious because we are not there yet. I am afraid there is an inherent degree of uncertainty about the situation, which is why we are in the position of not being able to rely just on the limited derogation written into the legislation which allows an ex post facto, if you like, derogation, having inadvertently missed the target. That is not the position we are in. We will, as I said, do it as soon as the fiscal conditions allow.
Naz Shah (Bradford West) (Lab)
From actively breaking international law in a “very specific and limited” way to breaking commitments on international aid, does the Foreign Secretary not realise how his Government are slowly weaning Britain from its role as a world leader, day by day making us more irrelevant on the world stage? Every former living Prime Minister can see why this move is morally wrong and politically unwise. Why can the current Prime Minister and his Government not see it?
Dominic Raab
I think the current Prime Minister, and certainly this Foreign Secretary, gets a little fed up with hearing Britain being done down. I have to say to the hon. Lady that, despite the coronavirus pandemic and the fiscal conditions we face, we are none the less putting in £10 billion, which, on 2019 figures, has us as the second-largest overseas development aid contributor. When I speak to our interlocutors abroad, from Asia to Africa, and when I speak to our multilateral partners, from Dr Tedros to António Guterres, they do not share this self-flagellating defeatism or this will to do Britain down. They understand that we make an unparalleled contribution in the world as a force for good. We shall continue to do so.
Wes Streeting (Ilford North) (Lab)
We now know that because of the Government’s choices the economic price facing the country is higher, that the manifesto commitments the Conservatives made last December can no longer be trusted, and that when the Government talk about hard choices what they really mean are real-terms pay cuts for key public sector workers such as teachers, teaching assistants, police and firefighters, and cuts to support for the world’s poorest. Can the Foreign Secretary at least tell us what he thinks the public will be more concerned about: aid that goes to the world’s poorest which actually saves us money in the longer term, or the gross waste of public money through billions of pounds of poor Government contracts and barrels full of public money handed over to Tory donors?
Dominic Raab
I think that’s Twitter lined up for later on in the afternoon. The hon. Gentleman asks what the public expects. I think they ask us in a sober way to look at all the choices. We have done that.
Dominic Raab
The hon. Lady has advocated cutting ODA in the past. She now shakes her head. [Interruption.] She wants to fudge it as repurposing. We are not going to fudge it in the way that she does. We are going to be very honest with the British public about an incredibly difficult set of decisions. We are making sure that we can see our way through the pandemic. We will still be contributing £10 billion to the world’s poorest, to climate change and to girls’ education. I think they will understand. If the hon. Gentleman has any alternatives, rather than just criticising from the Opposition Benches, we would be glad to hear them.
Madam Deputy Speaker (Dame Rosie Winterton)
Order. I know how important this statement is, but we do have two further debates, on climate change and on covid-19, so I urge colleagues to have fairly short questions and, correspondingly, short answers.
Marco Longhi (Dudley North) (Con) [V]
Thank you, Madam Deputy Speaker. A short question coming up. Will my right hon. Friend please confirm to the House that the UK’s aid spend will also be focused on ensuring that the most vulnerable around the world get access to vaccines?
Dominic Raab
My hon. Friend is absolutely right. We have demonstrated that through our leadership of the Gavi summit and our leadership role in the funding and galvanising of international funding for COVAX, and we will continue to do so.
Dave Doogan (Angus) (SNP) [V]
The fact that the aid budget is set as a percentage of GNI means that it is necessarily self-regulating. Budget allocations on such a basis remain consistent with the prevailing economic conditions, so if 0.7% was okay for normal times, surely it must be fine for lean times, too. Having reneged on a key Tory manifesto commitment less than a year after the election—in itself surely something of a record—will the Secretary of State advise the House of what detailed analysis he has commissioned to quantify the cost to humanity of removing £4 billion in aid from the poorest communities in the teeth of a global pandemic?
Dominic Raab
I do not think it is right to say that just because there is a percentage based on GNI, that means we can deal with a situation of the severity that we face now, with the worst economic contraction in more than 300 years and a budget deficit double that of the previous financial crisis. These are not ordinary times in which the natural stabiliser built into the target can apply. The hon. Gentleman asked how we will safeguard and prioritise; we have an allocations process. We are not going to salami-slice ODA across the different pots of money; we are going to make sure that we do it in a strategic way, and I will be taking that forward in the weeks leading up to Christmas.
Ms Nusrat Ghani (Wealden) (Con)
My right hon. Friend has said that, going forward, the right decisions will be made to deal with everything from poverty to extremism. For that to be the case, he has to focus on the safety and security of women and girls, which requires access for them to good and safe education. Will he update us on how we will continue to do that? During this, the week of the International Day for the Elimination of Violence against Women, the greatest number of women being abused are Uyghur women who are being abused by the Chinese state. Will he update us on what support he can provide to Uyghur women?
Dominic Raab
I have set out before the House how we will safeguard what we are doing on girls’ education and how we will maintain our leadership role with the global targets that we set.
We are very concerned about the position in Xinjiang. We recently made Five Eyes statements on it and brought together, in the United Nations Third Committee, a much broader pool of countries to express our concern. What needs to happen now is that the UN Human Rights Commissioner, or another independent fact-finding body, needs to be able to have access to check the facts, because China’s rejoinder is always that this is just not happening. There are too many reports that it is, we need to get to the bottom of this, and the UN Human Rights Commissioner has a role to play.
Debbie Abrahams (Oldham East and Saddleworth) (Lab) [V]
The provision of overseas development aid is not a selfless act: it is in our interest to foster global peace and sustainable development, thereby reducing the migration associated with war, climate change, disease and famine. What is the Foreign Secretary’s assessment of the impact on international peace building and migration associated with the Government’s choice to cut foreign aid?
Dominic Raab
The hon. Lady is absolutely right. I do not see a siloed distinction between our moral interest in what we do abroad and the national interest—they are often combined. In respect of some of the areas that she mentioned, she should look at what we are doing on defence and security; it may not be strictly within the DAC rules, but it does have a huge impact on our soft power abroad and the stability of the countries that she mentioned. We are going to use the allocation process to make sure that we mitigate some of the concerns and risks she mentioned, but of course we will not be able to continue all the funding that we are doing. These are difficult choices that come as a matter of necessity in the emergency financial situation that I am afraid we find ourselves in.
Mrs Pauline Latham (Mid Derbyshire) (Con) [V]
The International Development Committee has long recommended that there should be a single sign-off by—since its takeover of the Department for International Development—the FCDO on all UK ODA spend, no matter which Department spends it. Who in the FCDO will ultimately be responsible for that? I appreciate that the Foreign Secretary is far too busy.
Dominic Raab
Ultimately, the Secretary of State and Ministers are responsible to Parliament for financial spending. We look carefully at both the underspend and the overspend. We are constantly looking not just to strengthen our internal processes—we have looked at that again as a result of the merger—but to make sure through ICAI and the Select Committees in this House that we have maximum transparency. If my hon. Friend has any other specific proposals in that regard, I would be happy to consider them.
Stephen Flynn (Aberdeen South) (SNP)
On 30 June, the Secretary of State said in response to a question from my hon. Friend the Member for Angus (Dave Doogan):
“I assure the hon. Gentleman that we are committed to spending 0.7% of GNI on aid.”—[Official Report, 30 June 2020; Vol. 678, c. 142.]
Will the Secretary of State confirm whether he was not being truthful with the House at that time, or did the Chancellor and the Prime Minister simply not tell him what they were planning to do?
Dominic Raab
Amid all the hyperbole, I understand the point that the hon. Gentleman is making, but the truth is that the full scale of the economic situation was not clear—[Interruption.] It was not clear, because we were coming through—[Interruption.] The hon. Gentleman is chuntering. Let me answer the question; I am trying to take him seriously on this and he should listen to the answer. The fact is that if he looks at June, we were coming through the first wave. We had not got ourselves into a position of having to go into a second lockdown and, frankly, the full financial effects were not clear. He is right to make that point, but there is a very clear reason why we have had to take the measures that we have, which we take as a matter of regret. We wanted to avoid that, but it is because of the nature of the virus and the prolonged financial impact that it has had on businesses and, as a result of that, on the public finances.
Harriett Baldwin (West Worcestershire) (Con)
Our economy has taken a terrible shock this year and that is why 0.7% means that we have already had to cut aid by £2.9 billion this year. Yesterday, I heard an update from the World Food Programme in South Sudan. It has had an even worse economic shock not just from covid, but from the ongoing conflict and the fact they have had locusts and biblical floods. Now, more than half the population is facing famine. The Foreign Secretary recently sent his special envoy for famine prevention and humanitarian affairs to South Sudan. Can he reassure the House that he will make no further cuts to the programming in South Sudan?
Dominic Raab
My hon. Friend is absolutely right to point to South Sudan. I could give a list of countries that risk the compound effect of conflict, covid and famine. We could add Yemen, Burkina Faso and north-east Nigeria, which is why I launched the first UK special envoy for famine prevention and humanitarian affairs, Nick Dyer, and why, as we go through the allocation process that I have described to the House, these are precisely the things—conflict, humanitarian and covid—that we will look very carefully to safeguard for all the reasons that she described.
Navendu Mishra (Stockport) (Lab)
The UK is seen as a world leader when it comes to international development. Our legislation ensures that aid is focused on poverty reduction. Can the Foreign Secretary share his views on tied aid and address the concerns of numerous Members on both sides of the House about the Government making a return to tied aid, which will harm not only the people who benefit from UK aid, but our nation’s reputation globally?
Dominic Raab
The hon. Gentleman asks a really good question. I do not agree with tied aid. I do not believe that we should go back to that system; I think it is from a bygone era. However, I have listened carefully to leading economists such as Paul Collier and, in particular, Stefan Dercon, who talked about the fact that the most enduring and profitable—for the countries affected—long-term partnerships, which are sustainable, do have a sense of partnership and two-way benefit. That is what makes them an enduring partnership. I was so impressed with the argument by Stefan Dercon that I hired him into the new FCDO when we merged the Departments to make sure that we had a really good progressive approach to the partnerships—particularly the long-term partnerships—that we take with those countries.
Stephen Timms (East Ham) (Lab)
The Churches played the key role in the 20-year cross-party consensus on aid, and I pay tribute to their achievement since Jubilee 2000 and Make Poverty History. We all realised what abolishing DFID really meant. Why did the Secretary of State not realise it?
Dominic Raab
I join the right hon. Gentleman in paying tribute to the Churches. Maybe they have a power of foresight that has been lost on humble politicians, but all I would say is that even at the point at which we did the merger, I do not think anyone could have foreseen the depth of the financial implications. As a former Treasury Minister, I think he would understand this; he has been through the process. The analysis was not there and the structural hit—not just for one year—to the public finances was not clear at that time. It is clear now. We have had to take a difficult decision. I have to say to him, as a former Minister, that these are decisions that, typically, Conservative Governments front up and, on the Labour side, they abdicate.
Crispin Blunt (Reigate) (Con) [V]
I welcome the opportunities that an integrated budget provides. I also welcome the Foreign Secretary’s focus on defending open societies. After the Prime Minister’s affirmative reply to my letters to the Foreign Secretary of 4 September and 12 October about securing global Britain’s leadership on LGBT+ rights, will the Foreign Secretary undertake to instruct officials to engage with the United Kingdom Alliance for Global Equality and any other relevant organisations to help to formulate the programmes of work that could be delivered and announced by the Prime Minister or him when the United Kingdom hosts the global Equal Rights Coalition conference next year?
Dominic Raab
I pay tribute to my hon. Friend, who has championed this cause relentlessly and with great passion and great eloquence. We are a global leader in this and we should be proud of it—I am proud of it. We are proud to be the Equal Rights Coalition co-chair with Argentina, and we are ambitious about what we can achieve through that strategy and the impact it will have. He talked about NGOs. Civil society has an incredibly important role to play, and we are committed to working with all the NGOs, including the United Kingdom Alliance for Global Equality, in the weeks and months ahead.
Craig Whittaker (Calder Valley) (Con) [V]
Having experienced three 100-year floods within eight years, we are only too aware in the Calder Valley of how vital immediate emergency help is from Government. While I agree with the short-term reduction in international aid because of the massive generational cost of borrowing money, among other things, does my right hon. Friend agree that the UK should continue to be a major donor in addressing the worst humanitarian and natural disaster crises throughout the world?
Dominic Raab
As I have set out, that is of course one of the priorities that we will safeguard as we reduce the financial envelope. My hon. Friend is absolutely right. I think there is cross-party consensus. For all the public criticism there sometimes is of the ODA spend, alleviating conflict and dealing with the aftermath of humanitarian disasters is what ODA should be spent on and what it should be prioritised for. That is what this Government and global Britain are all about.
Bambos Charalambous (Enfield, Southgate) (Lab)
The pandemic has reminded us that the virus does not respect borders. Countries with weaker health systems and poor water and sanitation facilities are less likely to defeat covid-19, maintaining the virus’s threat to the UK and the world. Can the Secretary of State confirm whether that was taken into account when making the decision to cut vital aid? Can he explain what he means by returning to the 0.7% commitment when the fiscal situation allows? What metrics will be used to determine that point in time?
Dominic Raab
The hon. Gentleman is absolutely right about covid and other public health priorities. That is why, as I have set out, we are not just taking a salami-slicing approach to the £10 billion of ODA next year. We will look strategically. As I have already said, that is one of the priorities. It is difficult to give him the precision he may want on when fiscal conditions will allow us to get back to 0.7%, but that is a result of the pandemic. I am sure we will have greater clarity as the weeks and months go ahead. We have got to get through this pandemic and allow the economy to recover. This is a temporary measure taken as a matter of necessity and we will get back to 0.7% as soon as the fiscal conditions allow.
Anthony Mangnall (Totnes) (Con)
To say that I am disappointed by the decision is an understatement. I am horrified that we have decided to break a manifesto commitment, and I am horrified by the message it sends to the many women who have suffered such horrendous acts of sexual violence in conflict, especially given the fact that yesterday was the UN International Day for the Elimination of Violence against Women. I know how hard it is and that the Foreign Secretary did not want that decision, but why did he and the Government not look at reforming this and at a multi-year funding formula—rather than one based on the calendar year—to reach the 0.7%? That would have given us the long-term strategy and the commitment to the world’s poorest.
Dominic Raab
I thank my hon. Friend for what he is saying, and I understand that he is trying to be constructive. I think he is referring to the idea that we could reform and change the approach, as many have suggested even before the pandemic, to say that the 0.7% commitment is averaged out over several years. I understand that, and I think it is a good proposal. It is something that perhaps we should consider in any event, but the reality is that the depth of the economic hit, the depth of the contraction and the knock-on effect to the public finances mean that I am afraid that would not be able satisfy the challenge and the extent of the necessity that we face in trying to reconcile domestic and international priorities.
Madam Deputy Speaker (Dame Rosie Winterton)
We will now have a three-minute suspension to allow for the safe exit and entry of hon. and right Members.
Virtual participation in proceedings concluded (Order, 4 June).
Madam Deputy Speaker (Dame Rosie Winterton)
I have to inform the House of a correction to the result of the deferred Division held yesterday on the draft European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case Law) Regulations 2020. The number of Members voting Aye was 356, not 354. The number of Members voting No remains at 261. There is no change to the outcome of the Division.
Backbench Business
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text
Climate Change Assembly UK: The Path to Net Zero
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Madam Deputy Speaker (Dame Rosie Winterton)
Before I call Darren Jones, I must inform colleagues that there are clearly two well subscribed debates this afternoon, so I will have to impose an immediate time limit of five minutes on Back-Bench speeches.
Darren Jones (Bristol North West) (Lab)
I beg to move,
That this House welcomes the report of Climate Assembly UK; gives thanks to the citizens who gave up their time to inform the work of select committees, the development of policy and the wider public debate; and calls on the Government to take note of the recommendations of the Assembly as it develops the policies necessary to achieve the target of net zero emissions by 2050.
It is a pleasure to open today’s debate, for which I am grateful to the Backbench Business Committee. The Climate Assembly UK’s final report runs to more than 500 pages, and, as I suggested in this place a couple of months ago, it provides an invaluable evidence base for Ministers in this and future Governments, and for colleagues across the House, as we chart our course to net zero.
I am grateful to my fellow Committee Chairs, the right hon. Member for Ludlow (Philip Dunne), my hon. Friend the Member for Sheffield South East (Mr Betts), the right hon. Member for Tunbridge Wells (Greg Clark), the hon. Member for Bexhill and Battle (Huw Merriman) and the right hon. Member for Central Devon (Mel Stride), whose Committees, together with my own, set that work in motion. Most of all, I am grateful to all the participants, who gave up their time to make the Assembly a reality and so hasten the cause of ambitious action to combat climate change.
None of us doubts the urgency of that work and, with all the other challenges we currently face, we should not forget about the scale of the tasks ahead of us in reaching net zero and persuading other countries to do the same. Before I begin my substantive remarks, I should also declare my interests, as my wife is the head of external affairs at the Association for Decentralised Energy.
Today’s debate is especially timely for the House in the context of the Prime Minister’s so-called “Ten Point Plan for a Green Industrial Revolution”. Today, using the Climate Assembly conclusions, and noting its outcomes as representative of the British people, I will highlight what the British people think about the Prime Minister’s 10 points. At a headline level: barely a quarter of the £12 billion highlighted in the Prime Minister’s plan represented new announcements, and our total proposed spend still lags behind that of other developed European economies. It is right to point out that the Committee on Climate Change target of 2% of GDP in net-zero spending includes leveraging private sector spending alongside public sector spending, but, unfortunately, we did not get much further on this issue in the spending review yesterday. Like others, I welcome the Chancellor’s announcement on a national infrastructure bank. Such a bank will have the potential to accelerate financing and free up large-scale investment for decarbonisation, but net-zero obligations need to be enshrined in the bank’s founding mandates.
On offshore wind, I am sure we all welcome the Government’s willingness to invest more in transmission and networks, and the restated commitments both to a quadrupling of our capacity and to significantly expanding the use of domestically manufactured components, but the public will expect action to bear out that optimism. The Government’s stated intention to bring these jobs home simply by incorporating requirements for UK content into contracts for difference just will not cut it without a seriousness about how, where and when these jobs will be created and trained for, underpinned by a detailed allocation of resources. Recent failures on this front, including the collapse of the BiFab—Burntisland Fabrications Ltd—contract in Scotland, bring into question our ability to reach our existing offshore sector deal targets, let alone future targets, and show the need for reform. The Climate Assembly report identifies support in excess of 95% for prioritising offshore wind within the UK’s energy mix, which should demonstrate to Ministers the appetite that exists for action of the pace and scale required.
Next, the Government’s plans to boost hydrogen production are also worth interrogating more closely. I know that a number of colleagues in the House have an interest in that and I look forward to their contributions later today. Although 83% of Climate Assembly participants took the view that hydrogen power should form some part of the UK’s eventual energy mix, they had substantive concerns about its scalability, value for money, and the risks and early-stage costs associated with producing and storing hydrogen as a usable fuel. Should Ministers agree with the Assembly’s conclusions in this report, they may wish to pause to reflect on those concerns and provide some answers on them. That is even truer, it has been argued, if the journey towards developing usable capacity for hydrogen is carbon-intensive, and truer still if the trade-off is forgone investment in cleaner and simpler routes to decarbonisation. However, as I say, I welcome the debate on this topic today.
Carbon capture technologies will also ultimately serve a purpose in complementing the transition to renewable energy, in enabling some less adaptive carbon-intensive processes to continue, and potentially in harnessing the potential of hydrogen, but the scale of that role is up for debate, and some people view the target of 10 million as inadequate without a much faster economy-wide transition to clean energy sources. In that context, the technology did not command a consensus among Assembly members, with just 22% support for carbon capture alongside fossil fuels as a long-term solution.
The eventual role of new nuclear power is also something on which the public are pretty sharply divided, with 34% of assembly members expressing support and 46% voicing opposition. The lines of disagreement will be familiar to Members, with supporters stressing nuclear’s reliability and potential to create jobs in the near term, but with sceptics worried about safety, non-carbon environmental degradation and high up-front costs.
The target for 600,000 annual heat pump installations by 2028 is welcome, in conjunction with both energy efficiency measures and obvious job creation. It enjoyed 80% support among Climate Assembly members, but the Government should consider whether these initiatives are best delivered through empowering and resourcing local authorities to drive investment in local communities, instead of a top-down approach that fails to take a technology-neutral position on policy making. Indeed, in the assembly report there was 80% support for heat pumps, 80% support for heat networks and 80% support for potential hydrogen, and the conclusion was that local people and local communities should get to decide which technology best suits their needs.
The extended deadline for the green homes grant is also welcome, but the early teething problems with the current scheme need to be fixed urgently and the remaining funding for those works, as allocated in the Conservative party manifesto, need to be forthcoming.
Moving briefly to transport, the Government’s hugely welcome headline announcement on phasing out conventionally powered cars commanded 86% support in the assembly. In order for the Government’s £1.3 billion to be spent efficiently, alongside the Chancellor’s welcome announcements yesterday in relation to money for rapid charging hubs and subsidies for home and street-side charge points, it is crucial that decisions are taken on the basis of credibly evaluating demand at the local level. One hopes that there will also be a greater willingness to come out of our cars and to use public and active transport more. Most assembly members support investment in lower-carbon buses and trains, as long as they run more frequently and less expensively, and some early announcements from Ministers, while welcome, must go further.
On jet zero, or lower-carbon intensive flight, the same questions of personal choice and collective responsibility are also at the centre of the debate about how to reduce emissions from air travel. Assembly members accepted that growth in air passenger numbers has to be slowed, but many baulked at the suggestion of outright restrictions on people’s ability to fly. Instead, there was broad consensus around the principle that passengers should pay in proportion to the frequency and distance travelled, and that airlines themselves must pick up some of the tab for decarbonising aviation.
Lastly, the prospect of a renewed focus on tree planting and peatland restoration, if underpinned by a fair system of incentives and sensitivity to the needs of individual farmers, proved highly popular, albeit with some participants expressing scepticism about the limits of its potential ecological benefit. This is one example where the role of Government in broader educative or explanatory notes on net zero policy decisions is important.
The question of fairness was central to the deliberations of the Climate Assembly, and it should be clear that the broad support that exists for decarbonisation can only be sustained by guaranteeing that the new economy offers the possibility of skilled, dignified work to everyone who seeks it, and that those currently employed in carbon-intensive industries do not disproportionately lose out from the net zero transition. Building such an insistence on fairness into our strategy for achieving net zero is a critical test set for the Government by the assembly, and I would welcome an update from Ministers on how it will figure in the plethora of now very delayed but highly anticipated announcements on all of these issues from the Department.
The public expect the Government to build on the Prime Minister’s 10-point plan with concrete, strategic and serious action that is adequate to the scale of the task at hand. Ministers can best do that by learning the lessons of the Climate Assembly, ensuring that our response to the climate crisis is deliberative, democratic and fair, and moving forward with the justified confidence that the public are on board and on side. The report itself also contains additional valuable suggestions beyond the Prime Minister’s initial 10 points—there are more things that need to be done—which I hope will be considered carefully.
The valuable, credible and timely conclusions from the Climate Assembly should be taken as a guide to our actions. The report’s key recommendation was that the Government should forge cross-party consensus to sustain action beyond political cycles that commands the support of successive Governments. I am confident, and I hope it is now clear, that across the mainstream of this House such consensus exists. It is time now, therefore, to act.
Madam Deputy Speaker (Dame Rosie Winterton)
As I said, there will now be a five-minute time limit. I call Sally-Ann Hart.
Sally-Ann Hart (Hastings and Rye) (Con)
It is a pleasure to follow the hon. Member for Bristol North West (Darren Jones), who highlighted some very pertinent points. I welcome the Climate Assembly report and its recommendations, which form a valuable body of evidence about public preferences for how to get to net zero and show that there is public support to get this right. This path requires strong leadership from Government to forge long-term planning between people and businesses, and I therefore welcome the Government’s 10-point plan for a green industrial revolution, which is aimed at eradicating the UK’s contribution to climate change by 2050. Two of the points in the 10-point plan that I would like to highlight today are to do with carbon capture and storage in nature, which tie into the Climate Assembly recommendations.
To achieve net zero by 2025 necessitates reducing greenhouse gas emissions as much as possible. However, reducing emissions alone will not be enough. Ways of removing and storing carbon were considered by the Climate Assembly. Assembly members heard about potential removal methods through tree planting and better forest management, restoring and managing peatlands and wetlands, and enhancing the storage of carbon in the soil. Better forest management was the Assembly members’ preferred option. They said that it was a brilliant thing to do but not enough on its own and a starting point.
Taking that into account, we must not forget about our coastal habitats and seas and blue carbon—carbon captured by our oceans and coastal ecosystems. Our oceans and coasts provide a natural way of reducing the impact of greenhouse gases on our atmosphere through sequestration of carbon. Protecting and restoring our coastal habitats is vital to tackling climate change. Our coastal habitats can play a vital role in tackling climate change and protecting us against rising sea levels, as well as being the home to internationally important wildlife. They also bring much-needed tourism and green jobs to seaside communities such as mine in Hastings and Rye, especially as we recover from the coronavirus crisis.
Globally, we have lost more than half of our coastal habitats due to a destructive combination of climate change, sea level rise, coastal erosion and development, and we are predicted to lose up to 3,000 hectares more per year by 2050. In beautiful Hastings and Rye, we are blessed with so much nature, including Rye Harbour nature reserve and a coastline of shingle beaches, reedbeds and saline lagoons. The banks of the River Rother, for example, are lined with salt marshes and wetlands that teem with wildlife. When properly functioning, salt marshes can suck up carbon up to three times faster than tropical rainforests, yet it is estimated that as much as 1 billion tonnes of carbon are being released annually from degraded coastal ecosystems worldwide.
In addition, when we lose this natural coastal buffer zone, coastal houses and businesses are put at much greater risk of flooding. Projects such as the Royal Society for the Protection of Birds Wallasea island in Essex now protect local villages from repeated flooding. If we were to scale this up, it has been estimated that in England alone we could create 26,500 hectares of new salt marsh, which could make use of innovative partnerships that connect local communities and NGOs with Government and private investors. These projects can also provide new outdoor landscapes for local people to enjoy, with physical and mental health benefits, as well as tourism, potential income and rejuvenated fishing stocks.
Although the ocean’s vegetated habitats cover less than 0.5% of the seabed, they are responsible for more than 50% and potentially up to 70% of all carbon storage in ocean sediments. Seagrasses and marshes along our coasts capture and hold carbon, acting as a carbon sink. One acre of seagrass can sequester 740 lbs of carbon per year or 83 grams of carbon per square metre, which is the same as the amount emitted by a car travelling 3,860 miles. In the UK, up to 92% of our wonder plant, seagrass, has disappeared over the last 100 years. Seagrasses provide one of the most productive ecosystems in the world. An area of seagrass the size of a football pitch can support over 50,000 fish and more than 700,000 invertebrates, which is great for our fishing industry.
The benefits of blue carbon projects are huge. With the UK Government’s plans to decarbonise the maritime industry, the industry can and should play a vital role, working in partnership with blue carbon projects around the UK’s coasts. It is time that we unlock the potential of our coastlines to reach our 2050 goal of net zero emissions and to reverse our loss of wildlife, while simultaneously helping to provide our coastal communities with jobs and investment where it is needed most.
Barry Gardiner (Brent North) (Lab)
Please do not worry, Madam Deputy Speaker, it is not my speech that I am holding. You and I have seen a lot of reports since we came into the House, and I have here the “Millennium Ecosystem Assessment”, the “UK National Ecosystem Assessment”, the “State of Nature” report, “Net Zero: The UK’s contribution to stopping global warming”, the “Clean Air Strategy 2019”, “Land use: Policies for a Net Zero UK”, “Reducing UK emissions: Progress Report to Parliament” and “How carbon pricing can help Britain achieve net zero by 2050”—just a small selection of what is on my shelf. Do we really need another report? Yes, we do.
All those reports are politicians telling the public what needs to be done. This Climate Assembly UK report, “The path to net zero”, is the public telling the politicians what needs to be done. About time too! Some fantastic principles have been used to get there. The report is 552 pages long—it is a big read—but it is underpinned by fundamental principles: education and information, fairness, freedom of choice, protecting nature and restoring our natural environment, strong joined-up leadership from Government and a joined-up approach. That is what makes it different.
I want to go straight to recommendation 1:
“We want the transition to net zero to be a cross-political party issue, and not a partisan issue”.
I take it that everyone in this Chamber is in agreement that we need to achieve that. If anything that I say to the Minister sounds like a criticism, it is not because I want to play party politics. I want to co-operate with the Minister, to work with him and to achieve what we have all set our face to achieve.
I want to focus on how the report looks at joined-up government. In that respect, I recommend to everyone yet another report, the National Audit Office report on “Achieving government’s long-term environmental goals”. It states that the 25-year environment plan
“brings together a number of government’s environmental commitments and aspirations in one place, but it does not provide a clear and coherent set of objectives…and…government has yet to set a clear course for the development of a coherent and complete set of environmental objectives, and for a full set of costed delivery plans”.
The report goes on to say that
“government has yet to set out whether or how it will clarify long-term ambitions for the five environmental goals that it has not designated as priority areas…and…that neither Defra nor HM Treasury yet has a good understanding of the long-term costs involved in delivering the Plan as a whole…Defra is developing governance arrangements to help manage the links between different environmental issues”,
and has set up the “two oversight groups”, but:
“In July 2020 the Implementation Board started work to assign responsibilities for managing the links between goal areas, although it has not yet agreed what the most important links are.”
Furthermore, the report recommends that DEFRA
“maps out the most significant interdependencies between the goals in the 25 Year Environment Plan and sets out how decisions about any significant trade-offs will be made, and by who”,
and states:
“Government’s arrangements for joint working between departments on environmental issues are”
simply not good enough. There are
“no clear indications of senior ownership outside Defra and its arms-length bodies for the Plan as a whole…and…no regular, formal arrangements at all for Defra to engage other departments”.
I now go to page 539 of the Climate Assembly report, where it states that 78% of people engaged in the assembly agreed:
““There should be a Minister with exclusive responsibility and accountability for ensuring net zero targets are met and government departments are co-ordinated in their efforts and achievements to meet their targets”.
The Minister must act and do that.
Huw Merriman (Bexhill and Battle) (Con)
As Chairman of one of the six Select Committees that commissioned Climate Assembly UK to report on how the UK should meet the Government’s target of net zero greenhouse gas emissions by 2050, I warmly welcome the report, thank all those who contributed and look forward to the opportunity to debate the contents in the few minutes that I have. I also thank the hon. Member for Nottingham South (Lilian Greenwood), who was Chair of the Transport Committee when the assembly was commissioned.
I want to touch on the transport matters that the report focused on, because, as was rightly hailed, the transport sector is the poster child in its failure to turn itself around. Its carbon footprint still stubbornly contributes 33% of all carbon dioxide emissions released in the UK. There is much for the transport sector to do, therefore. The report rightly focused on surface transport, where 70% of the transport carbon footprint is made. I want to touch on a few of the causes and comment on what the Government are doing and perhaps on what more needs to be done.
First, the assembly called for a ban on the sale of new petrol, diesel and hybrid cars by between 2030 and 2035, and clearly someone has been listening because the Government’s 10-point plan for a green industrial revolution brings forward the date from 2040 set earlier in the year to 2035 and now to 2030. That is an incredibly ambitious target from the Government, and it is going to be a big challenge for the motor manufacturing industry and the charging infrastructure industry to ensure they can deliver.
I am pleased that the Government have pledged £500 million to kickstart that shift, but the key is consumer confidence. It is essential that electric vehicle owners are confident, no matter their household circumstances or their travel plans, that the mode is the correct choice for them, although I understand that there needs to be a sea change and, indeed, ambitious targets must be set if we are ever to deliver a shift away from combustion to electric. I think that that will necessitate a look at pay-as-you-drive, and I am pleased that the Transport Committee will be looking at both the question of ending sales of vehicles with combustion engines by 2030 and new modes to pay for driving.
I also want to touch on the call for Government investment in low-carbon buses and trains. The Government have introduced, or plan to introduce, at least 4,000 more British-built zero-emission buses, which I welcome. In addition, two towns will have electric-only buses. That is a great start.
There is already a plan to decarbonise the rail network by 2040, and the Transport Committee is currently in the midst of the “Trains fit for the future?” inquiry. We stand at a great crossroads: with 15,400 kilometres of track currently non-electrified, we can look at electrification, at battery, or even further into the future towards hydrogen, but if we move solely to electrification, we should consider that 1% of the national grid is already used for electrification on trains and 60% of our energy that creates electricity is regarded as dirty, and thus non-renewable. Therefore, if we increase electrification there is a danger that we will increase our carbon footprint, and if in years to come hydrogen is more ready to be used, it would be a huge shame to have vested everything in electrification—and it is more expensive as well. That said, there is a big challenge in industry to ensure that we can get the speed, the range and indeed the freight capability for hydrogen, and at present I absolutely admit that electrification is the only game in town.
On the question of adding more bus routes and more frequent services, the Transport Committee called for a bus strategy. I am pleased the Government have done likewise.
I disagree with bringing public transport back under Government control, although some might say that that has already occurred by osmosis. Under privatisation over the past 20 years, rail passenger numbers have doubled, as private enterprise is more incentivised to get people on to rail services than the general taxpayer ever will be, so I disagree with that one part of the report.
There is much more in this fantastic report, however, but I have run out of time. I very much support everything the assembly has done.
Lilian Greenwood (Nottingham South) (Lab)
It is a real pleasure to follow the hon. Member for Bexhill and Battle (Huw Merriman) and, indeed, to see hon. Members from different parties participating in today’s debate. Although it is timely, we are very much focused at the moment, of course, on the health crisis created by covid. Normally, I would have had a chance to write a speech, but today I am working from some very rough notes. While we are rightly focused on the health crisis that we face, not just in this country but internationally, the climate emergency has not gone away. Indeed, if anything, it bears on us even more.
The health crisis also gives us reason for hope and for learning. We have seen what amazing things can be achieved in a very short space of time when there is the will to do so. We have seen that people are up for almost unimaginable change when they really understand why it is needed. Parliament made a really important decision when it agreed that we would reach net zero carbon emissions by 2050. We cannot afford to wait. In fact, if possible, we need to go even faster, and that is a call that I would make. If we do not achieve that, our planet will be irreparably damaged. Having made that commitment, the Government, and all of us as parliamentarians, must set out how we will get there and how we will reach those decisions. In making those decisions and setting out the steps, public support will be essential, and that is why the role of the Climate Assembly is so vital.
I am really proud that the Transport Committee, which I chaired at the time, was one of those Select Committees commissioning Climate Assembly UK, but we owe a huge debt of thanks to the 108 people who took part and actually made this process a reality. I saw for myself, on the first weekend they met back in January, what it involved. It was fantastic to be in the room as an observer and to see the energy and the interest that they showed in the expert information that was being presented to them, the questions that they asked and the participation. It was really excellent.
It is important to recognise the value of assembling a group that is truly representative of the UK population in terms of age, gender, educational qualifications, ethnicity, where they lived, whether they were from an urban area or a rural one, and actually whether they were really concerned about climate change or slightly sceptical about the whole issue. Too often, we find ourselves in echo chambers. We just listen to those who hold similar opinions to ourselves or hear from those who shout the loudest. The assembly’s work provided a rare opportunity to hear some of the quiet voices of people who had been given the information and had time to consider their recommendations. That is hugely valuable.
The assembly’s hard work has produced a really comprehensive report, as has already been said, and a set of 50 policy recommendations, covering not only how we travel but how we generate electricity, how we heat our homes and what we eat. Those are clear and consistent, and if we follow them, they will help us to get to net zero. I think that they are an absolutely invaluable resource to support our work here in Parliament and our decision making. The recommendations are not binding, and I think that is right. We can make different choices, but we cannot avoid making choices and taking action. The Climate Assembly based its recommendations on a comprehensive and balanced set of evidence, and it heard a range of views.
I want to say a couple of things about the transport recommendations. I obviously welcome the assembly’s support for extra investment in low-carbon buses and trains and better public transport services, cheaper fares and investment in walking and cycling. I am delighted that the Government have already decided to act on the recommendation and brought forward the ban on new diesel and petrol cars to 2030, but I was disappointed that hidden away in yesterday’s spending review was a 15% cut in next year’s walking and cycling budget. I hope that when the delayed transport decarbonisation plan comes through, it does not disappoint us.
I would like to say more about road pricing. It is interesting that there was a wariness on the part of assembly members around that issue, so although I am glad that we are having a debate about it, we need to think about how we address the impacts on low-income households as we develop the policy.
Jerome Mayhew (Broadland) (Con)
As a member of one of the six commissioning Select Committees, I have followed the work of the Climate Assembly with considerable interest, but I have to confess that my initial impression was not favourable. The concept of a relatively small number of members of the general public—just 108 people, I think—being imbibed with any greater knowledge, understanding or wisdom than the ranks of experts that already advise Parliament and the Government on the one hand, and my own membership of a larger and infinitely more democratic citizens’ assembly—this place—on the other, made me doubt the value of the work being undertaken. Frankly, I was also concerned that the assembly would simply become a mouthpiece for some of the more extreme environmental pressure groups. But when the participants were surveyed about the quality of the information that they had received, 78% agreed that it had been fair and balanced between the different viewpoints. Although this was admittedly the lowest score for any of the evaluation questions asked, it still represents a substantial consensus of opinion.
Having now seen the assembly’s output, I recognise that my first impression was wholly a wrong one. Although the assembly’s work can in no way supplant the role of this House in formulating and then enacting public policy, its report has added greatly valuable insights to the debate on the mix of policies required to achieve our common goal. The standard answer to the question which technologies should be used to get to net zero is “all of them”, and that is still likely to be the case, but the Government should take note of the assembly’s views, and take note very seriously, given that public acceptance of the huge changes required will be critical to their success. If we do not bring the public with us, the best laid plans will be doomed to failure.
It is for that reason that I was so glad to read the Prime Minister’s 10-point plan for the green industrial revolution. I do not believe that it is serendipity that this key policy announcement mirrors so closely the Climate Assembly’s conclusions: increasing our target for offshore wind capacity from 10 GW to 40 GW by 2030; promoting the hydrogen generation market; accelerating the transition to electric vehicles, as has already been referred to during this debate; pushing additional investment into public transport, walking and cycling; and researching zero-emission aviation and shipping. The list goes on. It shows that the Government have been listening, and listening hard, and that they are seeking to reflect many of the Climate Assembly’s key objectives. It is a testament to the value of this process, and all those who were involved should recognise the impact that their work has already had. But there are some interesting differences.
Technologies that hold out the prospect of fixing carbon emissions without the need for behavioural change by us as consumers did not receive as much support by the Climate Assembly as I would have expected. Carbon capture and storage—either direct air or from bioenergy—were, relatively speaking, less popular than other proposed changes. In the responses in chapter 9 of the report, there was a strong desire not simply to fix carbon emissions but actually to address their root causes.
There is a desire to use our response to climate change as an opportunity to address what kind of relationship we should have with our natural surroundings—less an industrial supremacy and more, perhaps, of a collaborative symbiosis. Although it is my view that we will certainly need all our technological ingenuity in carbon capture and storage, and probably in nuclear, to achieve net zero carbon by 2050, as policymakers we should seek to understand and reflect this deeper and wider need. It is this more mature relationship between us and our environment that sets the current generation apart from its predecessors, and gives me such hope for the future.
Claudia Webbe (Leicester East) (Ind)
I congratulate the hon. Member for Bristol North West (Darren Jones) on securing this important debate. I also congratulate the members of the climate assembly who took part in producing this important report. As the hon. Member for Brent North (Barry Gardiner) indicated, the involvement of people from across the country in our democratic processes and in discussing important issues should be celebrated, and there is no issue that requires urgent focus and consideration more than the climate crisis.
The report sets out clear, holistic principles that will be central to achieving a liveable future. From how we travel, what we eat and how we use the land to what we buy, how we use heat and energy in the home, how we generate our electricity and how we will remove greenhouse gas, this report provides a mandate for decarbonisation that we in this House cannot ignore.
Climate breakdown is not a distant threat but is happening here and now. The World Meteorological Organisation found that the 20 warmest years on record have been in the past 22 years. Human-caused climate change has already been proven to increase the risk of floods, extreme rainfall, heatwaves and wildfires, with dire implications for humans, animals and the environment. Yet the Government’s recently announced green industrial revolution does not go nearly far enough towards addressing this existential crisis. Only £4 billion of the £12 billion scheme is newly announced funding, and that is four times less than the recently announced £16 billion increase in military spending. As Sir David King, founder and chair of the Centre for Climate Repair at the University of Cambridge, said,
“it is nowhere near enough to manage the British Government commitment to net zero… by 2050 or to provide a safe future.”
Not only is the 2050 target perilously unambitious, but, according to the Committee on Climate Change, the Government are not even on track to meet it.
The Tory Government continued to give oil companies further tax breaks until as recently as December 2018. The 2018 Intergovernmental Panel on Climate Change found that, to prevent global temperatures from rising by more than 1.5° above pre-industrial levels—seen by scientists as a tipping point past which climate disasters will be locked in—oil and gas production must fall by 20% by 2030. I am gravely concerned that if fossil fuel companies are left to their own devices, such crucial targets will be missed. For example, ExxonMobil is projected to extract 25% more oil and gas in 2025 than in 2017. Oil companies such as Exxon and Shell knew that their extractive industries were causing climate change as far back as the 1980s, but instead of informing the public, they funded climate change denial and those lobbying against environmental policy.
A 2017 study in the scientific publication World Development found that worldwide fossil fuel subsidies amounted to $4.9 trillion in a single year. It is estimated that eliminating those subsidies would have cut global carbon emissions by 21% and air pollution deaths by over half. It is therefore vital that these subsidies are ended and that Government bail-outs are subject to stringent commitments to workers’ rights, tax justice and rapid decarbonisation.
Without immediate Government intervention, the urgent action required to preserve a habitable planet will be too slow. That will cause unimaginable disruption and could cost millions of lives, most immediately and sharply in the global south, whose countries have contributed least to climate change. The current crisis has demonstrated that we are only as secure as the most precarious among us and that rapid social and economic change really is possible. At this unprecedented moment, the Government must consider all possible interventions and regulation to phase out the extraction of fossil fuels and to transition to renewables as soon as scientifically possible. The climate crisis is a class crisis. It must be the big polluters and corporate giants, who bear the costs, not ordinary people.
Anthony Browne (South Cambridgeshire) (Con)
I am a member of the Treasury Committee, one of the commissioning Select Committees for this report. I also speak as chair of the all-party parliamentary group on the environment and, indeed, as a member of the Environment Bill Committee, which has today finished legislating on many of the measures that were included in this great report.
I see stopping environmental destruction as the defining mission of our generation. For those who have not yet seen the film “A Life on Our Planet” by David Attenborough, I highly recommend it. It shows what has changed on our planet throughout the lifetime of that remarkable individual, including the destruction of habitats, species extinction and climate change. We have a lot of work to do. Tough action needs to be taken, but we are a democracy and we need to take the people with us. Too often, those at the more radical end of the environment movement take a coercive approach: they want to turn back the clock, stop people doing things, dismantle capitalism and tell people what they can and cannot do. The trouble with that is that it risks a backlash. If we do not take the people with us, it might give rise to the anti-environmental populists that we see in other countries.
This is why the Climate Assembly is so important, and I thoroughly welcome its report. These are members of the public considering the issues carefully and coming up with their own recommendations. It really shows just how sensible the British public are. They accept the need to tackle climate change. They know it is a real problem. They are not trying to resist it, and they support practical measures to do it, but they want to do it without sacrificing quality of life, because we do not need to. They do not want to stop going on holidays or living the lives they lead, and it is that pragmatism that is so essential.
There are 50 proposals in the report overall, and I have little disagreement with any of them. I am delighted to say, as my hon. Friends did earlier, that the Government are already implementing many of them. This could be one of the most quickly implemented reports of all time. On electric vehicles, the report recommends certain other vehicles being banned by between 2030 and 2035, and the Government have said that that will happen by 2030. I thoroughly support that. I have just been legislating on the deposit return scheme, which is also one of the report’s recommendations. I thoroughly support that, too. The report recommends more offshore wind, and the Government are committed to quadrupling it in the next 10 years to 40 GW.
The report recommends nature-based solutions such as planting more trees and increasing carbon capture in soil. Again, the Government are now fully supporting that. It talks about hydrogen solutions for heating in domestic housing, and that is part of the 10-point plan. The Government are fully supporting that with £500 million to start with. As my hon. Friend the Member for Broadland (Jerome Mayhew) noted, the Climate Assembly was less enthusiastic about some things, particularly carbon capture and storage, which I am rather enthusiastic about. It is a new technology, but it is being done elsewhere and it could form an important part of the mix, as most mainstream climate scientists agree.
I am glad that the Climate Assembly did not want to move the date for becoming carbon neutral forward from 2050, which is what some of the more radical environmental groups want. That 2050 date was set by the Intergovernmental Panel on Climate Change. The UN body said that it was necessary to do that to meet the Paris target of 1.5° warming. That was adopted in the UK by the Committee on Climate Change, which set out a programme of work that the Government and we as a country need to do to reach that target. Obviously we have now adopted 2050 as a legal target, and we are the first major country to do so. This shows the leadership that the UK has taken on this, and we can be thoroughly proud of that, but there is absolutely no room for complacency. The public support the strong measures we are taking. We are going to need to take a lot more strong measures in the future, but at least we know that the public are behind this. That is why I welcome the Climate Assembly, and I welcome this report.
Madam Deputy Speaker (Dame Rosie Winterton)
I am sure colleagues understand that there is pressure on time, so after the next speaker I will have to reduce the time limit to four minutes, so that we can get everybody in for this debate and the next one.
Sarah Olney (Richmond Park) (LD)
This is a really excellent report and set of recommendations, and I want to thank all those members of the public who gave up their time over a series of weekends, as I understand it, during the beginning of the pandemic to consider the difficulties ahead of us as a nation and to think carefully about how we should respond. As they have put in all that time and effort to produce this report, I think it is incumbent on the Government to really think about it, to form their response and to take up the agenda for the radical change that we need to see if we are serious about tackling climate change. It is quite clear that the public are on board. They know what needs to be done, and it is time that the Government took up their call.
The recommendations in the report are wide-ranging and cover a wide range of Departments across Government. Government policy on climate change currently seems to be funnelled through the Department for Business, Energy and Industrial Strategy, but it is quite clear in the report that the Department for Transport, the Ministry of Housing, Communities and Local Government and the Department for Environment, Food and Rural Affairs, not to mention the Treasury, also have a part to play in delivering these recommendations. With all due respect, is the Secretary of State for Business, Energy and Industrial Strategy sufficiently senior in Government to co-ordinate the response to climate change across each of those Departments? Should we not have a Department and a Secretary of State for climate change, as there used to be, to bring all these strands together and to be held accountable for delivering the Government’s net zero pledge?
On that theme, the importance to the UK of our co-hosting of COP26 next year in driving through the change we would want to see internationally has been much talked about, not least by the Government. Would it not make sense to appoint a full-time person to oversee the UK’s contribution to this massively important event rather than ask the Secretary of State for Business, Energy and Industrial Strategy to do that as part of his role? That person could then be well placed to co-ordinate across different Government Departments and become a focal point for driving the change towards net zero.
The contribution made to our carbon emissions by vehicles is well covered in the report, and I welcome its recommendation that electrical vehicle charging infrastructure receives greater investment and that the sale of petrol and diesel cars be banned by 2030. It was really good to see the Government commit to that in their 10-point plan last week.
As the Member of Parliament for Richmond Park, the issue of traffic, roads and parking is one on which I receive a great deal of correspondence. In some parts of my constituency, congestion is a real blight on people’s everyday lives, and we even see long queues of traffic through the national nature reserve that gives my constituency its name. The negative impacts of excessive car journeys on everyday life go beyond emissions and poor air quality: they threaten lives, create congestion, and cut people off from their streets and town centres; and inasmuch as people are choosing car journeys over walking or cycling, they cause inactivity and poor physical health. At least in urban areas, a policy to reduce the overall number of car journeys that people make would have profound benefits on quality of life in any number of ways beyond carbon emissions. There was a hope during the first lockdown that people might switch to other forms of travel, but that does not appear to be borne out now. I was therefore pleased to see a recommendation that overall car journeys should be reduced, although a reduction of 2% to 5% per decade seems unambitious when car use has risen by 7.5% in the past five years alone.
The report proposes policy solutions for greater investment in public transport, making it cheaper, greener and more accessible, with a greater investment in cycling. The provision of usable alternatives is key to reducing car journeys. I note that the Government announced a £27 billion investment in roads earlier this year and a £257 million investment in cycling infrastructure yesterday. This appears to be a nettle that has not yet been grasped. I also note that no further support for Transport for London is budgeted in the next financial year. That seems to suppose that public transport usage in London will bounce back to pre-pandemic levels by April 2021. Well, I am very pleased at what that implies about the speed and scale of the Government’s vaccination programme.
I was pleased to see the recommendations on upgrading our homes. It is clear that people want a range of solutions and financial support to access this. We need to develop and embrace new technologies for heating our homes, such as heat pumps, if we are to achieve our net zero target. The Government are right to say that this is an area of potential to create new jobs, and skilled jobs, in every region of the UK, but I am keen to understand how they plan to deliver them. According to answers to written questions I have received from BEIS, on 10 November the Government were expecting 80,000 jobs to be created through the £1.5 billion green homes grant. This mysteriously shrank to 50,000 in the Prime Minister’s 10-point plan last week. The shortcoming of the green homes grant is that it is only open for a year, and there are not enough skilled contractors to be able to deliver against the demand created. I asked the Department how long it would take to train someone to install heat pumps, and the answer was that an existing builder could take on skilled people and deliver that—
David Johnston (Wantage) (Con)
I congratulate the hon. Member for Bristol North West (Darren Jones) on securing this debate.
I think that each Conservative Member speaking in this debate is a proud member of the Conservative Environment Network, and we all found a lot to welcome in the Climate Assembly report. Starting with its structure, I probably will not say this very often, but I echo what the hon. Member for Brent North (Barry Gardiner) said, because the fact that it was representative of the country at large meant that we got a set of recommendations with a lot of common sense that were not dogmatic, and, importantly, placed an emphasis on fairness. Too often, as I have said in this House before, we can have the affluent telling those on lower incomes that the holidays they go on, the cars they drive and the clothes they buy are all wrong. We have to take account of the fact that people have different means and can go at a different pace in making changes in their lives.
I welcome the report’s emphasis on education. We are fortunate in my constituency to have Westmill wind and solar farm, one of the few co-operatives to run a significant wind and solar farm. It has just been given a grant by the Government of a new visitor centre, which can accommodate six times the current number of visitors. There will be a heavy emphasis on teaching children in schools about renewable energy.
I welcome the report’s emphasis on getting people on to public transport. I want Grove station in my constituency to be reopened, not just because that would better connect the people of Grove, but because it would get people off congested roads.
I welcome, too, the focus on greener homes. We know that buildings and homes are an issue, and I extend an invitation to the Minister, and also to the hon. Member for Bristol North West (Darren Jones) or anyone else in the House, to come to see Greencore Construction’s Springfield Meadows development in my constituency, which is net zero both in build and in usage. It did not cost much more than normal homes do, so I recommend that people come to visit.
The assembly also wanted leadership from Government, and there is a good story to tell there—the first country to legislate for net zero and a landmark Environment Bill, which sets and imposes our new governance for a range of new measures on air quality, biodiversity and so on. I am more excited about the Agriculture Act 2020, because paying farmers public money for public goods is an exciting development in our attitude and policy towards farmers, in that we will protect them as custodians of the environment.
We have just heard the 10-point plan for a new green industrial revolution. That is the way to think about this. We led on the first industrial revolution and we can lead on the green one. So much of that chimes with what was in the assembly’s report, from making proposals on jet zero, so people can still fly but do so in a way that does not harm the environment as much, to bringing forward the date for banning the sale of new petrol and diesel cars, as well as greener homes, protecting nature and using offshore wind, which a remarkable 95% of the assembly supported.
There is much in the assembly’s report that chimes with the agenda that the Government have set out. I appreciate that people always say, “You could do more.” I accept that there is more to do, but what Government announcement has ever been met by people saying, “That sounds about enough.”? The Government are doing all they can there.
I am proud that we will host COP26 next year, and the assembly members should be rightly proud that they have helped to point the leadership direction that we should take.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I, too, welcome Climate Assembly’s report and its 14 recommendations on aviation. As my hon. Friend the Member for Brent North (Barry Gardiner) said, this was a people’s assembly, not a politicians’ assembly. That is why its recommendations are so powerful.
It is a pleasure to follow the hon. Member for Bexhill and Battle (Huw Merriman) and my hon. Friend the Member for Nottingham South (Lilian Greenwood), the Chair and former Chair of the Transport Committee, on which I sit. As I sit on that Committee, and because I represent a constituency adjacent to Heathrow, I am particularly interested in the chapter on aviation.
The impact of covid, to return to the other key topic of the moment, has been devastating for my communities, affecting up to one household in three. We seek support from Government for aviation communities right now, but that support could go hand in hand with actions on the climate crisis. Air travel accounts for 22% of UK greenhouse gas emissions and 7% of total UK emissions. That proportion is growing.
Unlike countries such as France and Austria, the UK did not provide covid sector-specific support for aviation, so, to date, the Government have missed the chance to impose conditions, and therefore help to introduce changes, on climate emissions. Such conditions would have helped to support not only work to address our zero-emissions target, but aviation communities such as mine.
The Government should look at emissions from international aviation and shipping, and include those in the Climate Change Act 2008. The Climate Change Committee has also called for the Government to formally include those emissions, so doing so would really show the UK’s leadership on this issue, set a clear policy framework around emissions, and create a clear path to the future. It would also help to boost investment in carbon-saving technology in the aviation sector.
Mention has already been made of the Prime Minister’s 10-point plan for the green industrial revolution, but I do not feel that this plan goes far enough. For instance, there has been mention of the Jet Zero Council, led by industry leaders, but to date industry on its own has missed targets, such as that to get 10% of fuels from sustainable fuel sources by 2020. With the scale of the crisis facing our planet, and with the rapid need to make urgent changes, we cannot afford to just create more grandiose councils: we need action and leadership from Government.
I will now address two specific aviation issues. On surface transport, we really need the Government to put their money where their mouth is on the western and southern rail links into Heathrow, to get more cars off the road and encourage sustainable transport. We need to require airports to take action on airside vehicles, from coaches, ramps and luggage transport to pushback tugs. In the air, of course, we need the Government to fund research into zero-emission planes, and also to level the price differentials between plane and train journeys to the same destinations.
In conclusion, I welcome the work the Government have done to support walking and cycling, which helps to cut our personal climate emissions, and look forward to hearing the Government’s response to the Climate Assembly recommendations on aviation.
Alexander Stafford (Rother Valley) (Con)
I refer hon. Members to my entry in the Register of Members’ Financial Interests. Obviously, having been part of the Business, Energy and Industrial Strategy Committee’s commissioned report, and given my previous background working for the World Wildlife Fund, but also a company called Shell, I have a particular interest in this sector.
Like all Members of this House, I welcome what this report has said. We have gone through how many great recommendations it contains and how good it is, but the question I want to pose to the House is this: what now? The Government have already come out with a very good 10-point plan. They are already implementing this, so what value does this report actually add? Yes, it shows that the public are on our side—the side of lowering carbon—and I completely agree with them, but we knew this before. Did we need a report to help us formulate these ideas? The Government have already moved forward with quite a lot of them.
To me, the assembly’s report missed a slight opportunity, because although we have talked about quite a lot of the measures involved—increased wind power, road pricing, electrification, and hydrogen, which Members know I am a big fan of—they lack some sense of ambition, and of bringing the public forwards. Dealing with our carbon emissions is not only something we need to do for the good of our planet and of our health, but a huge economic benefit for this country. It is the new technologies that I am very excited about. A warmer home—a better-insulated home—is not only better for a person’s carbon emissions, but it is better to live in. An electric car is not only good when it comes to emissions: it is a better thing to drive. These new technologies that are helping us deal with the climate crisis are giving us a better standard of living, and although I appreciate that this report was looking at how we reduce our carbon emissions, I fear it could have been so much more, to help show the public that lowering our emissions is a good thing for everyone. Regardless of the carbon side of it, dealing with our emissions is going to lead to better homes and more jobs, and I very much believe that if we get it right, we are going to see a huge economic boom for this country.
Some people have already mentioned hydrogen. I was a bit disappointed with the assembly’s report when it comes to the hydrogen elements for transport, because although electrification of passenger vehicles is very far ahead, we have missed the boat on the economic side. With 73% of all batteries made in China, we are not going to get an economic advantage from passenger vehicles. Yes, we can deal with the carbon advantage, and I completely agree that is very important. However, we also want the economic advantage, which is why I think hydrogen transport—I have an Adjournment debate on this topic later today—can decarbonise heavy goods vehicles, trains and even planes. That is something we are not fully addressing. If we get that right ourselves, we can create jobs and have an economic boom in this country. That is what I think we should do.
So much of this discussion is about how we lower our carbon emissions. But that argument has been won. Nobody in this House has stood up and said that they disagree with the report and that we should not lower our carbon emissions. We have all said that we should. What we should be talking about now is how we get there faster and how we can create economic opportunities for this country. An Opposition Member—I cannot remember which one—talked about having a separate climate change department. I would say no to that. I would like climate change combined with the business side, because the two are interlinked. By lowering carbon, we can have an economic boom. I would rather have climate change in every single Government Department, with every single Department looking at different elements of it, rather than a stand-alone department which would be ignored. I want it embedded at the heart of the Government and I am pleased that it is embedded at the heart of the Government.
One aspect I want to briefly touch on is that I believe so much more can be done on carbon. When we talk about planning new homes, we should be mandating that every new home has an electric charge point and a heat pump. We should be building for the future, not the present.
Kerry McCarthy (Bristol East) (Lab)
I congratulate my colleague, neighbour and hon. Friend the Member for Bristol North West (Darren Jones) on securing this debate. As the then vice-Chair of the Environmental Audit Committee, I attended one of the sessions of the Climate Assembly in Birmingham. I was impressed by the set-up: how assembly members had been selected, and the huge amount of work and expense that went into trying to ensure it was representative and reflective of the general population. I was also impressed by the contributions of expert witnesses and the efforts that were made to ensure that their work informed deliberative discussion in each group.
There were disadvantages. I share some of the scepticism of the hon. Member for Rother Valley (Alexander Stafford) about the exercise. It is expensive, certainly if we are looking to replicate it at a local level, as we are in Bristol. If we want to do it right, we have to put in quite a lot of resources. It also takes time. There is the question: we actually know quite a lot of these things, so why do we not just get on with it, rather than having an exercise that will inevitably delay things? One Conservative Member spoke about how the Government were introducing a deposit returns scheme. He implied that that had come out of the Climate Assembly report. The Environmental Audit Committee has been making these recommendations and investigating that side of things for a long time, and that was already on the agenda. On electric vehicles, the December 2019 Labour manifesto called for a phase-out of petrol and diesel by 2030. It did not really need the Climate Assembly to nudge the Government in the right direction; they could have just listened to the Labour party instead.
Having said that, I was won over by going along and listening to the discussions. There is a quote in the executive summary from an assembly member, who said that he or she—it was someone called Chris, so I am not sure—was worried when they got there that the debate would be somewhat one-sided and it would all be people who were very passionate about the climate emergency. They said it was refreshing to see that it ranged from people for whom it was a complete crisis to those who were in complete denial about the issue. Getting that balance is what an exercise like that should be about, but I worry that it means that the process will inevitably lean towards consensus. That could lead to a watering down of ambition when the scale of the twin crisis—the climate crisis and the ecological crisis—means that more radical solutions are needed.
Some people have criticised the assembly for not reaching the right conclusions and have said that that was because they were not asked the right questions. These are people who feel that the 2050 target is not ambitious enough. It is worth noting that proposals to bring forward the 2050 date, without a specific date in mind, were put before the assembly but were rejected, with quite a significant proportion of people unsure about it.
I attended the sessions on what we eat and how we use the land, which is a particular interest of mine. I was pleased with the recommendations on low-carbon farming, food waste and natural climate solutions such as peatlands and forestry. It was interesting to see that, by and large, people were coming quite new to those arguments, whereas perhaps if it was a discussion about transport they would have given it a lot more thought in their everyday lives. It was interesting to see the further information they were asking the experts for and how willing they were to shift their views as they listened to the answers they were given.
In the final few seconds I have to speak, I wish to reflect briefly on the additional recommendation that we should get to net zero without pushing our emissions to anywhere else in the world, which was endorsed by 92% of assembly members. The fact is that we are already doing that. We cannot tackle climate change in this country unless we also look at our global carbon footprint.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
I add my voice to those who have welcomed assembly’s report. As an initiative with its roots in Parliament and an exercise in co-operation across the different Select Committees, it was innovative and courageous and something on which we should now look to make progress and to build.
My constituency has been at the heart of this nation’s energy supply for the past 40 years. As we have relied on hydrocarbons, we have been home, very successfully, to two of the largest oil terminals that bring in hydrocarbons —oil and gas both—from the North sea and latterly from the area to the west of Shetland. We have a long history of being central to this country’s energy supply. We are now coming to a phase of our nation’s history in which we anticipate that our reliance on hydrocarbons will wind down. My constituency remains equally committed to playing a full part in energy provision for our future needs. It is therefore somewhat frustrating for us still to find that the opportunities that we have to contribute to green renewable energy in the future are somewhat frustrated by a lack of action and recognition on the part of the Government in respect of the opportunities that exist.
I met the Minister earlier this year with the Marine Energy Council, from which he heard about the opportunities that exist in the development of wave and tidal power, which has been a long, slow burner. We have now reached the phase of having finished the research and development work but not yet being fully able to go to commercial deployment. Every technology goes through this phase; we know that because back in the 1980s we were at the forefront of the development of onshore wind. The prototype of many of the turbines now seen throughout the country was built not far from my house in Orkney, on Burgar Hill—it was initiated by Cecil Parkinson back in the day. We did the groundbreaking, leading work on developing the technology, but we did not then fund the next stage to get it to commercial deployment.
The risk now is that we will do the same thing with marine energy, and in particular the development of tidal energy. We have done the research and development; we now need to find something like an innovation power purchase agreement, or a similar mechanism, that will get the industry through to the point at which it can contribute its full potential through a mature technology. We know that we are not going to get there, but we know also that if we leave it to others, others will take the opportunity. Just in the past week or so we have heard that the European Union is coming forward with its draft marine energy strategy, and it now speaks about an altogether different scale of deployment and development.
My worry is that we are about to lose the opportunities in respect of not just generating power for use in our own country but the development of a home-grown supply chain, which could be crucial and central to providing the green jobs about which we all speak in this Chamber. The sums of money involved in an IPPA for the marine energy sector are relatively small; the opportunities that they could produce for the UK as a whole, and for Orkney and Shetland in particular, are enormous. The Minister has heard this from the industry’s mouth; I hope that when he comes to respond to the debate he will have some good news to tell the industry.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I, too, pay tribute to the members of the public who came forward, not only for giving up their time to participate but for the effort they put into listening, learning and debating—unlike many of us politicians. It is amazing to see how many recommendations they were able to make on a consensual basis, and they are to be commended for that, too. The recommendations are also reasonable and practical, and I wish to look at some of them and see how the UK Government and the Scottish Government measure up against them.
Perhaps the first UK Government fail is the publication of the 10-point plan for a green industrial revolution, which of course makes no reference to the Climate Assembly, nor does it really accord fully with its recommendations. I do welcome the fact that they have brought forward the date for phasing out internal combustion engines to 2030, which matches the recommendation of the assembly. The assembly also calls for grants for low-carbon cars and a car scrappage scheme, which I fully support, but the Government have not yet implemented that, and there need to be bigger grants for electric vehicles. The Scottish Government do interest-free loans for the purchase of ultra-low emission vehicles, and they have extended the interest-free loans to the purchase of second-hand cars to try to extend the market and open it out for a wider public. I think that is something the UK Government could look at as well.
The assembly calls for investment in low-carbon buses and trains. Thanks in part to funding from the EU as well as funding from the Scottish Government, in Aberdeen we have the world’s first double-decker buses that run fuelled by hydrogen. The Scottish Government have awarded £7.4 million to bus operators through the Scottish ultra-low emission bus scheme, and that is going to procure 35 electric buses manufactured in Falkirk by Alexander Dennis Ltd, protecting jobs in these tough times. So where are the UK Government’s proposed electric bus town and the associated orders, and what replacement funding is there—to replace EU funding—for hydrogen buses?
The assembly’s recommendations on air travel are also realistic and welcome, especially the effective points where the polluter pays. We do need to see more from the Government on sustainable aviation.
When it comes home heating, there was strong agreement on the need for hydrogen, heat pumps and heat networks, so again a hydrogen strategy is required. The initial steps outlined in the 10-point strategy are a start, but we need a proper heat decarbonisation strategy. We have 27 million homes currently reliant on fossil fuel heating, so even if we start in January 2021 and go all the way to 2050, that equates to 20,000 homes a week, roughly, that need to be decarbonised. That is the scale of problem we are dealing with, and it needs to be addressed quickly.
The Government are talking about a roll-out of heat pumps, and again that is welcome, but these need to be targeted, initially for homes off the gas grid. But the roll-out of these needs to be aligned with energy-efficient installations, because the heat pumps themselves do not work unless the homes are properly energy efficient. Again, the UK Government need to spend more. We need to see this £9 billion that has been pledged in the Conservative manifesto for energy efficiency.
When it comes to electricity generation, it was welcome to see the strong embracement of both onshore and offshore wind by the assembly. That shows that the decision to stop onshore wind bids in the last couple of CfD auctions was actually a major blunder, but it is good that onshore wind can now bid again. But we do need to see the contracts for difference procurement process improved to incentivise the use of local supply chains. It is a disgrace that a yard on Teesside is due to close, and there are the pressures in the BiFab yards in Scotland. I realise there is a consultation ongoing on the CfD procurement process, and hopefully the outcome of that will be that UK supply chains are incentivised.
The public in the assembly also recognised that nuclear is expensive and that waste storage is an issue, so when will both the UK Government and the Labour party wake up to this? It is insane to me that the 10-point plan is committing something like £40 billion to £50 billion to new nuclear. I would love to go back to the assembly, ask it to prioritise that £40 billion to £50 billion and ask where it would want to spend it—would it be nuclear energy, marine, tidal or more floating offshore? I think we know what the answer would be.
My one disappointment in the recommendations was the lack of support for carbon capture and storage, because to date that has been integral in the UK’s planning for net zero. We in the SNP want to see carbon capture and storage go ahead at Peterhead as part of the just transition away from oil and gas. This shows at least a rethink in policy, or much better re-engagement with the public, is needed if the public are to be taken with us on carbon capture and storage. The UK Government need to take account of this.
When it comes to the natural environment, I welcome the recommendations on and understanding of peatland restoration and reforestation. Again, the Scottish Government have led the way on this, because 85% of trees planted in the UK in the last few years have been in Scotland. Over 10 years, the UK Government have only planted 20,000 hectares of new forest, so how they are going to get to 30,000 hectares a year by 2025 is a mystery, and we need a long-term strategy for that.
There is so much more I could talk about in terms of land use, food production and all the rest of it. It is a great report. I really hope the Government take account of it and we see that in forthcoming policies.
Matthew Pennycook (Greenwich and Woolwich) (Lab)
It is a real pleasure to respond on behalf of the Opposition to what has been an extremely interesting debate. I thank all Members who have contributed this afternoon, the members of the Climate Assembly for taking part in the process and, in particular, my hon. Friend the Member for Bristol North West (Darren Jones) for securing the debate and for the focused and well-argued speech with which he opened it.
As my hon. Friend the Member for Nottingham South (Lilian Greenwood) and others made clear, we are in the midst of a climate and environment emergency. With the concentration of CO2 in the atmosphere continuing to rise unabated, the issue is not whether we can stop climate change—the climate crisis is, after all, already upon us—but whether we are willing to do what is necessary to transition to a net zero world in the coming decades and thereby arrest runaway global heating.
As my hon. Friend the Member for Bristol East (Kerry McCarthy) made clear, there is no solution to the climate crisis that does not confront the issue of carbon consumption, but even if viewed through the lens of production emissions, the UK is still not doing enough. Not only are we not on track for the net zero target that Parliament legislated for just over a year ago; we are not even on track for the less stringent one that preceded it. When it comes to the UK’s record on territorial emissions, there is much to be proud of, but progress to date is largely the result of having picked the low-hanging fruit, particularly in relation to the power sector. The decarbonisation involved—this is the key point—has only had a very limited impact on people. If we are going to get on track for net zero, we will have to make rapid progress in sectors such as transport and housing that are far more difficult to decarbonise and where the impact on people will be much more acute.
Faced with the sheer scale of the challenge, with all the disruption that the kind of systems change required entails, there are those who believe that we will somehow need to distance or even remove people from the decision-making process entirely. The Opposition take precisely the opposite view. The transition to a low-carbon economy is unavoidable, but the pace at which it happens in a democracy like ours and the extent to which it is orderly depends on the consent and, indeed, the active involvement of people and places—a point made by the hon. Members for Broadland (Jerome Mayhew) and for South Cambridgeshire (Anthony Browne). Far from that greater involvement leading to inertia or paralysis, the final report of the UK Climate Assembly suggests that if people are provided with the facts, and if they are given responsibility and a real stake in the process, they are likely to support bold climate action.
I do not have time to do justice to the many recommendations set out in the report, and in any case, my hon. Friend the Member for Bristol North West and others have done so in their remarks. I want to briefly step back and look at two of the fundamental principles that the overwhelming majority of Climate Assembly members felt should underpin the transition to net zero and that have been prominent themes in today’s debate: the need for strong leadership from Government and the need for fairness.
First, on the need for strong leadership, the Climate Assembly showed clear support for
“Leadership from government that is clear, proactive, accountable and consistent”
and leadership that allows for
“certainty, long-term planning and a phased transition.”
As things stand, the Government are not providing leadership of that kind. I have no doubt that the Minister will robustly refute that point. In truth, he knows as well as I do that the Government still do not accord emissions reduction the status that it warrants and, as my hon. Friend the Member for Brent North (Barry Gardiner) pointed out, there is still not the kind of grip from the centre necessary to co-ordinate and drive progress on ambitious climate action across Government and ensure clarity, certainty and consistency of approach.
We have seen plenty of announcements from the Government in recent months, some more significant than others, and a 10-point package—I will not call it a plan, because there is still no sign of a comprehensive strategy for achieving net zero and no serious attempt to close the net zero investment gap that exists. We have seen policy making that is at times so wildly inconsistent with that target that the Chancellor sees no issue whatsoever with delivering a spending review in which, in one breath, he talks about investment in a greener future and, in the next, he celebrates Britain’s biggest ever investment in new roads. The Government must do better.
The second point, which in the long run is probably more important, is that the assembly’s final report stresses the need for fairness to be at the heart of the transition. Historically, our country has a terrible track record of managing industrial change in a fair way. The loss of jobs and the damage to communities in previous transitions, particularly the brutal deindustrialisation of the 1980s, makes people rightly suspicious of claims that this time it will be different. The transition to a low-carbon economy is a much greater challenge in many ways than deindustrialisation, affecting in different ways almost every industry and region of the UK. The challenge ahead is to ensure that green policy is designed effectively so we mitigate the inevitable disruptive change that comes with that transition, and to ensure that people and places are protected and supported through it and—as the right hon. Member for Orkney and Shetland (Mr Carmichael) and others have argued—that there are tangible benefits, particularly for those most affected and the nations and regions hosting infrastructure. For that to happen, I would argue that people and communities will need to be actively involved in the process. Community power and worker voice will have to be factored into an industrial strategy when we finally see one.
The gilets jaunes movement in France is only the most notable example of how badly designed green policy and a failure to embed fairness of process and outcome in the transition can erode the public support necessary for it, so we need to hear more from the Government about how fairness can be embedded in the net zero process, and we need action now to ensure that the benefits of the green transition are realised here at home. I have to say that that is something the Government, along with the SNP Scottish Government, have demonstrably failed to do in letting the BiFab engineering yards in Scotland go to the wall, putting at risk the UK’s supply chain for the deployment of offshore wind.
In conclusion, we very much welcome the Climate Assembly’s final report. While the deliberative process, such as the one used for it, is not a substitute for representative democracy, we believe that it can improve the way it works. In the Minister’s response, as well as addressing the various points made today by hon. Members, I very much hope that he will indicate that the Government also recognise the importance of actively involving the public in shaping the pathway to net zero, and that he will give the House a sense of what consideration, if any, his Department is giving to building deliberative processes into any forthcoming net zero strategy.
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I thank all Members; this is one of the best debates I have seen in the House. I thought it was temperate, with lots of extremely well considered and informative speeches, so I am very pleased to take part in it.
I thank the hon. Member for Bristol North West (Darren Jones) for bringing this debate to the Floor of the House. I particularly thank the citizens who gave up their time to take part in the Climate Assembly UK. The Secretary of State for Business, Energy and Industrial Strategy spoke at the launch of the report, and we have taken this report extremely seriously in the Department in which I serve as a Minister. Initiatives such as the Climate Assembly play an important role in helping to develop policies that are achievable and fair.
In response to the point from the hon. Member for Greenwich and Woolwich (Matthew Pennycook), clearly, citizen engagement—the engagement of our people—is absolutely necessary if we are going to achieve the net zero carbon emissions target that we have set ourselves. I am very pleased that the Select Committees of this House took the initiative and were able to inaugurate this process. Many of the recommendations—people have said this—of the Climate Assembly report have been reflected in the Prime Minister’s 10-point plan that was announced last week, and I will return to some of those at the conclusion of my speech.
Public engagement of this kind, as I have said, is absolutely necessary. We completely agree with the spirit of the Climate Assembly’s recommendation on greater citizenship involvement, and that point was very ably raised by my hon. Friends the Members for Broadland (Jerome Mayhew) and for South Cambridgeshire (Anthony Browne), who is not in his place, and it was alluded to by the hon. Member for Greenwich and Woolwich. The Government will continue to engage with the public on the changes that are needed to develop our ambitions on net zero and to listen very attentively to feedback. People from all over the UK are already doing their bit on climate change, and, with the Together for our Planet campaign, we aim to celebrate this and inspire even more of our fellow citizens to join them.
As a Government, we have also increased dramatically our engagement with the public on policies for net zero. In the past year, we held deliberative workshops with the public on transport, heat, carbon capture and, particularly, on the environment. Last week, as I said and as has been mentioned many times, we saw the Prime Minister announce the 10-point plan. I remind the House that that 10-point plan delivered and reflected many of Climate Assembly UK’s recommendations. The assembly called for a green recovery. The 10-point plan is the Government’s plan for that green recovery, particularly focused on jobs.
Kwasi Kwarteng
There is limited time, so I will just allow one intervention.
Barry Gardiner
I am very grateful to the Minister. Speaking of the recommendations, the second most-supported at 94% was:
“We need much more transparency in the relationship between big energy companies and the government, due to concerns over lobbying and influence”.
His Department is responsible for that, so will he take that on board, because transparency is absolutely at the heart of gaining public confidence?
Kwasi Kwarteng
I agree with the hon. Gentleman. Transparency is absolutely central to any governing process, but particularly in respect of the challenge of fighting climate change.
The assembly called for more wind and solar power. We have stated not only in the manifesto on which we stood last year, but also in the 10-point plan, that we would quadruple offshore wind capacity to 40 GW by 2030. The assembly called for the driving of the growth of low-carbon hydrogen, and the 10-point plan committed £500 million in the first instance for low-carbon hydrogen production across the decade.
The assembly called for a faster transition to net zero emissions vehicles, and I was very pleased to hear the hon. Member for Richmond Park (Sarah Olney) mention that in her remarks. She pointed out the fact that in London, and particularly in her constituency, congestion, traffic and pollution are huge issues, and they apply equally to my constituency, which is only a few miles away from hers as the crow flies. I am very pleased to say that that call was listened to, and we have brought forward the zero emissions vehicles target to 2030. I have to add at this point that many natural supporters of the Government have been somewhat sceptical about that ambition, but it is something we are absolutely focused on delivering.
Furthermore, the assembly called for the Government to invest in low-carbon buses and trains. Again, we have committed in the plan to £4.2 billion on city public transport and £5 billion on buses, cycling and walking. The assembly requested that the Government speed up progress on low-carbon aviation, and that point was raised directly by the hon. Member for Brentford and Isleworth (Ruth Cadbury). Once again, as the MP for Spelthorne, which is even closer to Brentford and Isleworth than it is to Richmond Park, I fully endorse that move. I am pleased to announce that the 10-point plan commits to research projects for zero emissions planes and also for sustainable aviation fuels.
The assembly called for a strong policy on greening our buildings, and that point was ably raised by my hon. Friend the Member for Wantage (David Johnston). I am pleased to say that the 10-point plan provides £1 billion to extend the schemes announced by the Chancellor earlier in the year to put energy efficiency at the centre of our building strategy. The green homes grant has been inaugurated and we have extended its deadline. We hope to achieve further successes in the roll-out.
Finally, the assembly recommended maintaining and restoring our natural environment, and that is central to the Government’s ambition to meet the net zero carbon target. It is an ongoing area of policy. Initially, the plan has committed £40 million for a second round of the green recovery challenge fund, but I feel strongly that there will be more to come in that respect. Next year, we will publish a comprehensive net zero strategy and, crucially and critically, we will use our G7 and COP26 presidencies to promote international climate action and to provide the leadership that the hon. Member for Bristol North West spoke of in his remarks.
Mr Deputy Speaker (Mr Nigel Evans)
I thank Darren Jones for offering not to do a wind-up, saving another couple of minutes.
Question put and agreed to.
Resolved,
That this House welcomes the report of Climate Assembly UK; gives thanks to the citizens who gave up their time to inform the work of select committees, the development of policy and the wider public debate; and calls on the Government to take note of the recommendations of the Assembly as it develops the policies necessary to achieve the target of net zero emissions by 2050.
Mr Deputy Speaker (Mr Nigel Evans)
The session is suspended for three minutes.
Coronavirus Outbreak: DWP Response
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Stephen Timms (East Ham) (Lab)
I beg to move,
That this House notes the First Report of the Work and Pensions Committee, “DWP’s response to the coronavirus outbreak”, HC 178; and calls on the Government to increase relevant legacy benefits in line with increases to universal credit, to take steps to return people who have been inadvertently left worse off under universal credit compared with their previous benefits, and to suspend the no recourse to public funds visa condition for the duration of the coronavirus outbreak.
I thank the Backbench Business Committee for this opportunity. The new Work and Pensions Committee had an ambitious programme. Our first meeting in March was with the Health and Safety Executive, but in no time we were in lockdown and our programme was set aside. The Department for Work and Pensions has been key in this crisis as so many have lost the means to earn a living, and universal credit has delivered. I have been a frequent critic. I repeatedly pointed out that transition to universal credit could not be completed by October 2017, but the system that we now have has passed the test of this year. It is a national asset, which we should make the most of.
DWP staff have been on the frontline, with many redeployed to handle the tidal wave of claims. They have withstood enormous pressure. In our report, the Committee expresses thanks to them for their dedication and hard work, and that does need to be reflected in their pay; yesterday’s announcement was a heavy blow.
Ministers made good decisions at the start. After a decade of cuts, the £20 increase in universal credit and working tax credit, and the reconnecting of local housing allowance with actual rents, were key for many to surviving the crisis. I had understood that local housing allowance would be kept in line with local rents, so I was dismayed yesterday to hear that it will be frozen—decoupling it once again. My Committee agreed unanimously that the £20 increase should stay and many others have taken that view, including the Joseph Rowntree Foundation’s “Keep the lifeline” campaign. The campaign wrote an open letter to the Chancellor on 30 September with Citizens Advice, the Child Poverty Action Group, Feeding Britain, Oxfam, the Trussell Trust, disability charities and bishops. The Resolution Foundation says that otherwise:
“The basic level of support for an out-of-work single adult would fall to the level it was at when Margaret Thatcher left office”.
The Institute for Fiscal Studies warned of a significant decline in the incomes of 4 million families. The Chair of the Welsh Affairs Committee, the right hon. Member for Preseli Pembrokeshire (Stephen Crabb), a former Work and Pensions Secretary, called the £20 a lifeline and urged its retention. I very much regret that the Chancellor rejected those calls yesterday.
The spending projections show universal credit being cut by £20 in April, and people claiming universal credit are left fearing the worst. Our motion calls for the £20 uplift to be extended to legacy benefits. Yesterday, an increase of 37p per week was announced; Ministers must reconsider.
Not increasing jobseeker’s allowance and employment and support allowance for those out of work for ill health was done on the grounds, we were told, that computer systems were slow to change, but they certainly could have been changed by now, and it is absurd that people in otherwise identical circumstances, claiming different benefits because of universal credit roll-out sequencing, are receiving such different support. It is legally questionable. People should not face extended hardship because their benefits are run on out-of-date systems. Ministers were absolutely right to introduce the increase; it should be extended to legacy benefits, too
Our report last month, “Universal credit: the wait for a first payment”, calls for other much-needed changes. The five-week delay between applying and the first regular payment causes great hardship; we called for non-repayable starter payments to tide people over. We also called for “advances” to be renamed “loans”, to make it clear they have to be repaid, because calling them “advances” obscures that.
The motion also highlights the people made worse off by claiming universal credit. Government online advice says: “Apply online for universal credit to get financial support if you’ve lost your job.” For most people, that was sound advice, but not for everyone: if someone on tax credits claims universal credit, their tax credits stop.
We surveyed experiences of the benefits system in the pandemic; 6,000 people responded, and I thank all of them. Some had not realised that claiming universal credit meant losing tax credits. For some, their universal credit entitlement then turned out to be zero—for example, one of my constituents with £16,000 saved. That person was left, as many were, with no support at all. That is benefit mis-selling; Government should put it right.
In May, answering the right hon. Member for North Shropshire (Mr Paterson) here in the Chamber, the Secretary of State said that she would look “very carefully” at whether people should be able to return to previous benefits. That held out some hope, but now she says that allowing it would threaten to unravel the roll-out of universal credit; that is a very poor excuse.
Today’s motion highlights our call, also made by the Home Affairs Committee, for the no recourse to public funds immigration condition to be suspended for the pandemic. Some 3 million extra people have had to claim universal credit this year, but families working legally, with no recourse to public funds on their immigration status, do not have that safety net. They may get discretionary council help, but provision varies immensely. Indeed, Andy Jolly at the University of Wolverhampton has found that many families refused council help, so our report made this call:
“The Government should publish or at least clarify existing guidance for local authorities on what support they can provide for people with NRPF, including…whether measures such as the hardship fund are classed as public funds or not.”
At the Liaison Committee in May the Prime Minister said that people in this situation should get “help” of one kind or another. I agree, but unfortunately they do not. Families facing destitution can apply for exemption, but it is extremely hard. The all-party group on immigration law and policy heard this week from the Unity Project that it takes about 100 pages of evidence; many people cannot provide that. The Home Office takes a month, on average, to determine an application. No destitute family should have to wait a month for Government to decide whether they can claim benefit.
Our report in May also called for an impact analysis of the benefit cap in the pandemic. UC and the local housing allowance were rightly raised, but the benefit cap was not, so many families crashed into the cap for the first time. The Department told our inquiry that the number of people affected by that would be “very small”. We asked for a full analysis of the numbers and the characteristics of households newly subject to the cap, and of the impact on hardship. We now know that far from a very small impact, the number affected by the benefit cap has almost doubled in the pandemic.
In London, with high rents pushing up LHA, many have crashed into the benefit cap for the first time. People claiming benefit after losing their job have a nine-month grace period when the benefit cap does not apply. The employment Minister says that 160,000 households have a grace period due to end next month—the benefit cap will apply for the first time. I wrote to the Secretary of State yesterday, with the Committee’s agreement, about this issue. The Government were right to increase support for struggling families at the start of the pandemic and there should be a cap easement for those about to be hit.
Our report in May pointed out that the future jobs fund did a great job of supporting young people in the last financial crisis. I welcome the kickstart scheme, with its identical structure, that was announced the month after our report. It was disappointing to see yesterday that spending on kickstart will be much lower than planned. That seems to be because employers have to offer at least 30 places, thus shutting out small firms. That should surely be fixed. The Committee will take evidence on the Restart scheme, which was announced yesterday. An evaluation of the Work programme was published on Tuesday. Major commitment to employment support is absolutely right, but we need it—this is unlike what happened with the Work programme—to do a good job with, for example, disabled people.
The importance of dependable social security has never been clearer. The UC system and Department for Work and Pensions staff have passed an extraordinary test, and they have our congratulations and our thanks. The changes outlined in our report are needed now to minimise damage from the crisis, and to look forward and build back better in the months ahead.
Mr Deputy Speaker (Mr Nigel Evans)
I have asked Members to consider a five-minute limit. We are not putting the clock on, but Members who go wildly over five minutes will be doing a great disservice to those lower down the call list.
Danny Kruger (Devizes) (Con)
I pay tribute to the right hon. Member for East Ham (Stephen Timms) for securing this debate. There has been so much criticism of the Government in this place this year, much of it very unfair and political, and much of it fair and necessary in holding the Government to account for things that are going wrong. What we do not hear often from the Opposition, however, is recognition of what has gone right, which is why I note the generous spirit in which the right hon. Gentleman spoke about universal credit, acknowledging it as a “national asset”. That is good description of what has been achieved.
I honour Ministers at the DWP for the tremendous success story of 2020. There have been 3.2 million new UC claimants, a near doubling of the total case load, as I understand it, and yet despite all the protests about UC in recent years, I do not think that there been a squeak of protest in this place about the process of onboarding those claims. In my constituency, we have had nearly 3,000 new UC claims and, having just checked, I have had eight items of casework on UC this year, which represents a fairly small proportion of my total case load. I honour what has been done, and give my thanks to Jobcentre Plus staff and all the staff at the DWP. There are many heroes working behind the scenes in our country this year, and Jobcentre Plus staff are leaders among them.
I also wish to pay tribute to the coalition Government and principally my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for his role in designing and implementing UC. I can only imagine what would have been the case had we stuck with the old system and the myriad benefits, mostly with paper-based administration; it would have been a complete disaster. But we had a digital system, so when millions of people suddenly needed unemployment benefits, the computer said yes.
On that topic, the right hon. Member for East Ham raises the suggestion from his Select Committee in its report earlier this year that people should be able to go back to legacy benefits after being on universal credit. It is certainly true that, despite the significant increases in universal credit, some people appear to be worse off on it, but as we have seen, and as I have just described, UC is a far more agile system and the intention—I think of the whole House—is to replace legacy benefits. I agree with the Government’s position that it would not be right to let people go back. The right hon Gentleman mentions mis-selling: surely that is an exaggeration, but I do wonder whether more can be done to explain to people what joining UC means and to make sure that they are able to check properly whether it is the right move for them.
I also congratulate the DWP and, more particularly, Citizens Advice on its scheme, Help to Claim, which the DWP funds. It is the beginning of the far more substantial system that my right hon. Friend the Member for Chingford and Woodford Green always intended to accompany universal credit. The Government are recruiting 13,500 new work coaches to work in jobcentres, which is tremendous, but people need more than coaches—they need training, professional support and peer support. They might have issues with addiction or debt, or family problems. We need to create the systems that support job coaches and support individual jobseekers, so I urge the Minister to consider what more can be done to deepen Help to Claim beyond the initial period of joining UC to create a system that works with businesses and charities. The gateway system for kickstart potentially offers a model for that.
The right hon. Gentleman mentioned the future jobs fund. We want to do better than that, because it had quite a high drop-out rate. The opportunity for the kickstart scheme is to sustain those young people in employment, but in order to do that, we need to ensure that they have the right support around them, not simply the job placement itself.
My final point is more strategic and about the principles of welfare. I hope that I will not be thought abstract or even flippant when I make this point. I call in my defence Professor Simon Szreter of Cambridge University, who has made the same point. He said that we need to go back to the principles of the Elizabethan poor law. I am not talking about Victorian poor law—the Dickensian horrors of the workhouse and so on—but the original poor law of 1601. It was the first comprehensive system of social security in this country and, as Professor Szreter explains, it had two elements. First, it was local, it was funded from local taxation and it was paid out to people flexibly according to their needs. Secondly, it encouraged altruism and social responsibility by the wealthy through incentives to create almshouses, colleges and churches.
I do not propose going back to those days, but those are the principles that we need—a more local and more flexible approach and one in which the wealthy, by which I mean businesses in today’s age, play a central role in supporting local communities and helping people into employment. The right hon. Gentleman mentioned the need for a more dependable social security system, and I entirely agree. I support everything the Government are doing to help people facing unemployment, and I hope for more substantial reform in due course.
Martin Docherty-Hughes (West Dunbartonshire) (SNP)
It is good to follow the hon. Member for Devizes (Danny Kruger), although of course in the 1600s this Parliament did not exist, so those laws would not have applied in Scotland, thankfully.
I thank the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Stephen Timms), and all its members, including my hon. Friend the Member for Glasgow South West (Chris Stephens), for the report. However, I might be the fly in the ointment when it comes to some of the issues it raised.
From my perspective, and I hope that of the majority of Members on my Benches, the report provides a true exposition of the Government’s position on social security, and their ideological thinking about its role in society. At least on these Benches, we believe that a social security policy worth its name should be based on its role in defining society through support enabling equal access to security for all based on need, especially during a global pandemic. I am afraid that, at least from my perspective, the Government’s position and outlook seem to uphold a post-Thatcherite fundamentalism. It is as though they have offered a prayer to a dystopian Saint Francis of Assisi, “Where there is discord, may we bring more. Where there is error, may we entrench it. Where there is doubt, may we add to it, and where there is despair, may we embolden it.” I am afraid that I do not see UC as a national asset. I certainly see the members of staff who are having to deal with its consequences as an asset, because I and my team, and many other Members, know how much hard work they have done.
It is as though the Conservative party believes that the path to paradise begins in hell, but, just maybe, the long road to salvation actually lies in the Committee’s recommendations. For example, it says:
“The Department should continue to allow claimants to use their Government Gateway accounts to verify their identity once the lockdown has ended. It should also use this as an opportunity to reflect on what other changes to the process are needed, with a particular focus on the needs of people who are vulnerable and digitally excluded.”
I would actually go so far as to say that the opportunities of digitisation should not cloud the Government’s view of the lived experience of many citizens. Even the most advanced digital states recognise the fundamental truth of digitisation: it is to ensure that traditional means of access to services remain open to all, and it is not some mandatory utilitarian concept of happiness and human worth.
The Committee also states:
“We recommend that the Government urgently take steps to return to their pre-existing benefits, or the equivalent financial position, anyone who has inadvertently left themselves worse off by making a claim for Universal Credit during the coronavirus outbreak.”
It is as though those on the Government Back Benches see social security as they see foreign aid—as a reserve worth fleecing. Just as they fail to see the worth of foreign aid, they fail to see the worth of a needs-based social security system. I am reminded by Rachel Maddow that social security is not a Ponzi scheme, is not bankrupting and is not an outrage and that—these are my words—if it is funded and worked properly, it works. The Government should restore entitlement, as the Committee’s report highlights, not just because of covid-19, but because it is the morally just and economically sound thing to do.
The Committee’s litany of exasperation continues:
“In these exceptional circumstances, the Government should immediately suspend NRPF conditions on public health grounds for the duration of the outbreak”—
that is, on public health grounds during a global pandemic. As the Committee also notes, the Government might not even know how many citizens have no recourse to public funds—so much for a digital nation approach.
The Committee gets into its stride on the issue of the benefit cap, as the Chair of the Committee highlighted. It states:
“The Chancellor’s decision to increase Universal Credit payments by £20…is very welcome. But some households will not be able to benefit from these increases. This is because, as a result of the uplifts, they will be hit by the benefit cap.”
The Tory party giveth, and the Tory party taketh away, and all the while 4,100 of my constituents who are claimants have lost an average of £57, which was deducted during a global pandemic. That is the difference between queuing at Asda and queueing at a food bank.
I could go on to a litany of despair from Glasgow East; Kirkcaldy and Cowdenbeath; North Ayrshire and Arran; Ayr, Carrick and Cumnock; and Coatbridge, Chryston and Bellshill, in each of which nearly 4,000 constituents have lost, on average, about £52 to £55 over this period. That is less a prayer of supplication—a mea culpa, mea culpa—than a Tory mantra of faithless cold-heartedness that repudiates the worth of our common humanity. In summing up, I, my party and, I believe, Scotland repudiate that false dogma and its baseless Thatcherite foundations.
Shaun Bailey (West Bromwich West) (Con)
First, I pay tribute to the Clerks, the staff and fellow members of the Work and Pensions Committee, and to the right hon. Member for East Ham (Stephen Timms) for the work he did on this report. It was an interesting inquiry to be involved with and, as I am sure he will agree, we heard a wide range of evidence about the Government’s handling of the covid-19 pandemic.
The report recognises the unprecedented and difficult circumstances that our social security system has found itself in. Most of the people who rely on it have found themselves having to do so for the first time as a result of this crisis. We heard stories of people who never expected to have to rely on social security now having absolutely to depend on it. What we also heard about, and what has also been shown, are some of the operational challenges that the Department has faced. However, I have been very heartened by my hon. Friend the Minister’s listening mood and approach to some of these issues.
I want to concentrate my comments today on three things that I pulled out of the report. I certainly do not wish to step on or repeat any of the comments that right hon. and hon. Members have made so far, but for me a number of elements stick out: the operational challenges that the Department has faced during this period; the support for the self-employed and its impact, nowhere more so than in my constituency; and how we ensure that those people who have to go to work during covid get support from the agencies that are meant to ensure that they remain safe.
I first thank the DWP staff, who have been absolutely phenomenal during this period—I am sure we all agree. They have had to step up, with many seconded into roles of which they have had no experience before, and they have got on with it, worked hard and ensured that people who need access to benefits get those benefits and the entitlements they need. We heard stories in the report about how people not only got access to benefits but felt supported by the staff. People felt that they had the support, were being listened to and were being treated as individuals.
In looking at some of the operational notes, one of the things that stuck out was the verification of ID process. We heard that some of the issue with the process was that people sometimes found it complex and complicated. I absolutely support the need for digitisation of our benefits system—that is absolutely right, and we need to ensure that we have a streamlined system, which enables quick processing of people’s applications for benefits—but, certainly in a constituency such as mine, where I represent wards with some of the highest levels of deprivation, the digital divide is real.
Many people do not have access to digital services, whether the internet or IT equipment. However, I have been very impressed by the way in which jobcentres have engaged with people pre and post pandemic. This is a cross-Government project: we have to ensure that we plug the digital divide. I have said that repeatedly, and I will keep on saying it. We have got to ensure that people can access our services, irrespective of where they are, their background or where they come from. I am heartened by the discussions I have had with my hon. Friend the Minister and with other Ministers to ensure that we address the issue. I know that it is recognised.
I now turn to the self-employed. The fact is, as I said at the beginning of my remarks, many people found for the first time that they required support that they never thought they would need. In the report, I welcome the temporary suspension of the minimum income floor—a welcome acknowledgement by the Government of the problems for the self-employed, in particular those who have volatile monthly incomes. I also totally agree with the report on communications and the need to communicate with people about how to navigate the system. Often, self-employed people have found it difficult to know what benefits they are entitled to or to get the best support they need. I therefore welcome the Department’s and the Minister’s openness to ensuring that the self-employed get the support they need.
To touch on the point about the £16,000 saving limit, I know that it is one that my hon. Friend the Minister has recognised. However, we need to be acutely aware that many people put aside savings to pay their tax liabilities or to pay for things that they need. I know that the Department has heard that, and I have been really reassured by the conversations I have had with Ministers, but we must be mindful that people have not always burrowed such money away because they are well off; it is often intended to pay off liabilities, so the cash is not accessible.
Finally, because I am conscious that other colleagues want to get in, I turn to those people who went out to work during the pandemic. Many of my constituents cannot work from home, because they work in manufacturing, in food processing or as key workers. In the evidence from the Health and Safety Executive, we can see clearly that work still needs to be done on that. The TUC, for example, had 1,000 contacts from workers concerned about unsafe working and the HSE itself received about 6,000 concerns regarding social distancing.
Often, those workers who are classed as—I hate this expression—low-skilled had the highest risk and the highest death rates as a result of covid-19. It is important that the HSE is empowered to undertake spot checks and that we take an approach of cross-communication with the HSE, employers and, yes, trade unions to ensure that we have that cross-stakeholder approach to keep our key workers safe so that they can go out to work and so that those people in those jobs can continue to provide those vital services.
To conclude, I commend the Government for the unprecedented effort they have put in—let us not forget that at all. I commend my hon. Friend the Minister for his listening mood. The times have been unprecedented, and he has accepted the challenges and has the openness to solve them. However, ultimately, I cannot commend highly enough the work of the DWP staff and the fact that they have come out to ensure that our most vulnerable are supported.
Mr Deputy Speaker (Mr Nigel Evans)
I thank everybody for showing great time restraint and understanding.
Claudia Webbe (Leicester East) (Ind)
I congratulate my right hon. Friend the Member for East Ham (Stephen Timms) on securing this important debate. This report demonstrates how the coronavirus has exposed the critical shortcomings of our social security system, yet the report highlights issues that we have known about for a long time, such as the five-week wait for universal credit payment and the financial burden on claimants of repaying advance loans. The report also criticised the fact that the £20 increase in universal credit had not carried across to legacy benefits such as jobseeker’s allowance and employment and support allowance. That has resulted in people facing hardship as a result of the Government’s inhumanity. The Government must urgently level up their support.
The Institute for Fiscal Studies recently found that 4 million families face a significant decline in income if the Department for Work and Pensions goes ahead with its plan to scrap the £20 increase. It is deeply worrying that the Government are planning to cut universal credit amid an unprecedented economic crisis. That is especially concerning in Leicester East, as last month, over 5,000 of our residents claimed unemployment benefits—a figure that has more than doubled and has gone up by over 3,000 since the lockdown began in March. This means that our community’s unemployment rate is above the national average. It is also beyond belief that benefit sanctions resumed in July, during an unprecedented period of economic hardship.
The report highlights the impact of the callous “no recourse to public funds” condition during the pandemic, particularly on children. Thousands of UK residents who are undocumented and those who have no recourse to public funds have already been driven into destitution during this crisis. Recent Home Office statistics show that the number of migrants with no recourse to public funds who have applied for destitution funds increased dramatically by 572% in the months spanning the coronavirus crisis. This means that nearly 3,000 migrants facing total hardship could be waiting to hear whether they and their families will be able to avoid severe poverty—and that only includes the limited number of migrants who are aware of the destitution provision. Given the hostile environment for migrants, many do not know that they are eligible for any state support.
The statistics also reveal that it took the Home Office an unacceptable average of 30 days to decide on these life-or-death applications. This process must be considerably sped up, but better still, the concept of no recourse to public funds must be suspended for the duration of the pandemic at least. That would be the more humane approach to adopt. It is appalling that the Home Office does not even record the number of UK residents with no recourse to public funds, despite a recent intervention from the Office for Statistics Regulation, which expressed alarm at the Home Office’s repeated refusal to do so. It is contrary to reason to develop policy without knowing how many people the condition affects. The Government must adopt this most basic of tasks.
The report highlighted the performance of the Health and Safety Executive and its limited capacity to assess covid-secure workplaces. At the time of the report’s publication, the Health and Safety Executive had only shut down one workplace for covid-related reasons. As Members can imagine, this is particularly relevant for my community. One of the main reasons why worker exploitation in Leicester’s garment industry has been able to exist unchecked is that 10 years of austerity have severely downgraded our regulatory institutions. The Government have slashed the Health and Safety Executive’s budget by £100 million, or 46%, since 2010. Rights are meaningless if they are not properly enforced. The Government must therefore urgently reverse the funding cuts to regulatory bodies to ensure the safety and fair pay of those who work, and support our unions, which are championing them so excellently.
This Government’s cruelty over the past decade has transformed the Department for Work and Pensions into a symbol of fear. The coronavirus pandemic has further demonstrated the need for universal welfare support that we will be there to help and support people, not punish or police them. The Government must therefore empower the Department to act now to prevent the further impoverishment of working people and their families during the pandemic.
David Johnston (Wantage) (Con)
I congratulate the right hon. Member for East Ham (Stephen Timms) on securing this debate. I think it fair to say that he is well regarded on both sides of the House for his approach to these issues and for his expertise on them, which was reflected in his opening remarks and in his Committee’s report.
I want to speak in this debate because I think the performance of the Department for Work and Pensions during the pandemic has been one of the unsung successes of this period. It saw an increase in claimant numbers between February and August from 2.9 million to 5.6 million. There are few services that saw that level of increase. A lot of services saw a decrease. Some saw an increase, and obviously the biggest pressure was on the health service, but few saw such an increase in this period, and the fact that 93% of people were paid on time is a huge achievement.
I accept that for those among the 7% those delays are very distressing, although I know from my own constituents that the delays are sometimes caused if the Department does not have all the information it needs. I am not saying that that accounts for all the delays—I am sure there have been some things that have gone wrong for that 7%—but I wonder how many services, public or private, could claim a 93% success rate in the past decade or, indeed, the past two or three decades.
I want to pay tribute to the DWP staff. I was at the jobcentre in Didcot just last week, and their commitment and dedication to ensuring that every jobseeker gets the right support hit me in the face the moment I walked in.
Stephen Timms
I thank the hon. Gentleman for his kind remarks. Does he think the staff should get a pay rise?
David Johnston
We could make the case for all public servants to be given a pay rise at all times, but of course we have to keep a good control over the expenditure that the Government make on behalf of taxpayers. Considerable support has been given, in one of the most generous packages in the world, through the covid period, and I think that has to be taken into consideration when we talk about a pay rise. And of course some public sector workers are getting a pay rise; in fact, I think the majority still are.
I also want to give credit to the ministerial team and the way in which they have worked flexibly, whether in bringing forward the use of Government Gateway identification by six months or in suspending the conditionality on job-seeking for this period. All those things mattered and played an important role. Some of the criticism that has been made of the DWP involves things that I think are reasonable. For example, I think it reasonable still to require evidence of health conditions if someone wants to claim health-related benefits.
I accept the point about not everyone having the right level of digital literacy, but on the other hand, we wanted a system that was quick and easy to access, and we were keeping everybody inside, and I think that probably affected a small but not insignificant minority of people. Some of the other criticisms are about problems that people have with the system as a whole, such as the benefit cap or no recourse to public funds. I am not saying that those issues have not been exacerbated, but they are broader questions than just about the performance of the DWP during this period. I agree with some of the criticisms, however. The delays to mandatory reconsiderations, for example, are a problem. I have seen this for myself, and we have to sort it out. I know that the Department is committed to doing so, and the faster it can do so, the better.
After the Health and Education Departments, the DWP has had tremendous pressure placed on it, and the reason we have heard a lot less about it is that things have gone so well. That is not the case with everything, but it is a service that has gone a lot better than could have potentially been expected at the outset of this crisis, given the increase in the number of claimants. That is backed up by the statistics. The bottom 10% saw no reduction in the income level that they received, and the Government’s package overall reduced the scale of losses by up to two thirds, in the majority of cases, for working people.
The Department should be commended for this. It has some big things on its plate, like the kickstart programme—which I take a particular interest in, given my previous work with young people—and the new Restart programme. It is right to target those people who have been unemployed for at least a year. I think that what we have seen so far bodes well for how it will deliver these programmes.
Wendy Chamberlain (North East Fife) (LD)
I pay tribute to the members of the Work and Pensions Committee and its Chair, the right hon. Member for East Ham (Stephen Timms), for the important work they have been carrying out during the coronavirus pandemic. I welcome the recommendations in their report on the DWP’s response to covid.
For many of my constituents, this crisis has been the first time that they have engaged with the benefits system. While it is important to note that, as we have heard, there have been some successes, many of my constituents have been shocked to find out that what they believed to be a safety net has some significant holes. I want to limit my remarks to the issue of those left worse off and one particular constituency case.
One of my constituents, Lara, wrote to me. She is a student mental health nurse, and the previous academic year was the second year of her studies. During the pandemic, like all second-year student nurses, she was offered a fixed-term contract to help the NHS that would run until August. She said:
“It was fantastic to be recognised as having the skills that were needed, and like my classmates, I felt it necessary to take this offer. Should I have declined, I would then have needed to extend my studies by 6 months as in order to register as a nurse, 2300 placement hours must be worked.”
Many students nurses work alongside their studies to top up their nursing bursary, but Lara was unable to do that owing to disability, and, as a result, was eligible for housing benefit and for employment and support allowance, as well as the personal independence payment. She said that this was able to help her have a place of her own, which has vastly improved her health, something of which she feels the benefit daily. When she took on the fixed-term contract, that meant that she was receiving a wage, which meant a temporary pause in her benefits. She told me:
“I had to decide between keeping a benefit I was entitled to, or my education, and I chose my education.”
So she served on the frontline during the first wave of the pandemic, like so many other student nurses—I pay tribute to them all—putting themselves at risk to help protect our NHS.
But when Lara’s fixed-term contract came to an end, she found herself, in her own words, in “an awful situation.” She said:
“It turns out, since I started claiming benefits, the system has changed. Housing benefit no longer exists, neither does the version of ESA I received. I was advised I would now have to apply for Universal Credit, which…isn’t actually available to students.
Living off my nursing bursary, and PIP, means after I pay my rent and bills, I have £8 a week to live off. I either must take a loan, and leave university in debt, or give up my rented flat and move into a box room at my mum’s.
I am honestly so deflated that because I did what I felt was right in helping the country during the pandemic by providing skills I have, that I am now in this situation. It is a kick in the teeth that had I declined the placement, none of my benefits would have been affected.”
How is that fair? Lara showed such dedication in the spring to take the fixed-term contract when she was only halfway through her studies, putting herself at risk to help protect the NHS, and giving up the benefits she was receiving in order to do that.
It was people like Lara we were lining up outside our doors to clap for earlier this year. She and so many like her were making an enormous sacrifice to help keep us safe, and that is something we should be rewarding. What kind of society claps for our carers and then leaves them with barely enough money to survive on, applauds our public sector frontline workers and then hands them a pay freeze, and sees the need for a commitment to help the most vulnerable and disadvantaged around the world, only to withdraw that at a time when the need for support has never been greater?
The Committee’s report has rightly highlighted the failure of the Government to uplift legacy benefits in the same manner as universal credit. I have had a great deal of correspondence from constituents who have been directly impacted by this. In Lara’s case, this is someone on legacy benefits who leaves them and is now ineligible for both legacy benefits and universal credit. I hope that the Minister will engage with me on this particular case. Is there any estimate of how many other student nurses and doctors find themselves in the same position as Lara, having made the same decision earlier this year? We have seen from the Office for Budget Responsibility’s releases yesterday that welfare spending actually makes up a very small proportion of the total covid response. I look forward to the Minister’s response.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I, too, welcome the report, and the speech made today by my right hon. Friend the Member for East Ham (Stephen Timms).
The impact of the covid pandemic has exposed so many of our constituents, who never thought that they would need to apply for benefits, to the Department for Work and Pensions. They have experienced what many have had to put up with for years—politically driven viciousness towards those who, through no fault of their own, need help from the state to keep a roof over their head and food on the table. I do not blame DWP staff, who work hard to support increasing numbers of people in distress, but those staff are having to implement these terrible policies.
There are about 13,000 households on universal credit in my constituency as of last month. That is 50% more compared with the same month a year ago. There are also almost 5,500 households on legacy benefits and tax credits. That is an estimate. I am particularly concerned about people who have no recourse to public funds. We have no local data, but I know there will be many hundreds of such adults and children, given that the national estimate is 1.4 million adults and 175,000 children impacted. With no right to state help, apart from discretionary funds from already overstretched local authorities, there are real concerns about those people.
There is a particular impact on lone-parent families, especially with black, Asian and ethnic minority backgrounds. The Local Government Association has called for NRPF to be suspended, because these are people who, in the main, were working. They had a right to work and a right to live here, but their jobs have gone, particularly in my area, where so many jobs depend on Heathrow. That industry has been hit particularly hard. The Unity Project, which works with NRPF families, reports that 54% of its families assisted had no work during lockdown.
I want to cover a couple of cases and the experience of my case workers. People are using universal credit for the first time and having real trouble navigating what is a complex system, even for those with a high level of IT and literacy skills. The Work and Pensions Committee report mentions the difficulty facing self-employed workers owing to their specific needs. The minimum income floor has been suspended and they are worried that it might be brought back. Many self-employed workers who were excluded, particularly in the creative and arts sectors, have also been denied access to universal credit owing to the savings threshold. Savings are not some sort of indulgence; for many, they are the fund being built up for a deposit, so that they can get on the housing ladder, now that 100% mortgages are something of the deep past.
I want to discuss a case in respect of the benefit cap, which affects so many in my constituency, where rents are between £1,500 and £1,800 a month for a modest flat. Rents are high because we are in west London. The £27,000 benefit cap does not leave much change after the rent is paid, so let me illustrate that by way of the example of a lone parent, recently separated, with three children, one of whom is a tiny baby. Her rent is £1,300 a month. Her partner left her while pregnant and she claimed universal credit. She was awarded £1,731 a month, which meant that, after she had paid the £1,300 in rent, she was left with £431 a month, or £99 a week plus child benefit, for everything for her and her children, including a baby, which of course means additional costs. The two-child limit meant that she was not entitled to any more benefit once her third child arrived. She was left with the same amount to live on.
I am particularly concerned about those subject to sanctions and the reintroduction of the requirement for claimants to phone their DWP advisers or risk sanctions. That particularly impacts on those with learning disabilities or mental health issues. We know that mental health problems have escalated this year. Many need access to IT, but they have been dependent on face-to-face support to help them with their benefit claims and their journal. That support was often given in places such as libraries and other public spaces, but those have been closed for much of the year because of lockdown rules.
In conclusion, I support the Committee’s recommendations. I also oppose any attempt to cut the £20 a week increase for universal credit. I want to see an increase in legacy benefits in line with the £20 uplift to ensure that those on older legacy benefits, such as jobseeker’s allowance, are not missing out. I would have scrapped the benefits cap that penalises private renters, particularly in high-cost areas such as London, and suspended the savings cap. All that would mean money in the pockets of low-income families. That would not only help them: as we know, low-income families are far more likely to spend any additional pound in the local economy and that supports others. It is a win-win.
Rachel Hopkins (Luton South) (Lab)
I, too, want to start by thanking all key workers across the Department for Work and Pensions, including many members of the Public and Commercial Services Union, for their critical role in our covid-19 response, and for supporting millions of people across the UK, including the nearly 15,000 in Luton South who claim universal credit.
The unprecedented public health emergency, coupled with its economic implications, has seen hundreds of thousands of people turn to our social security system for the first time. I think it has been a shock for many people as they have realised how inadequate the support actually is and how hard it is to live on. The Work and Pensions Committee’s report provides an excellent holistic understanding of the severe shortcomings of the system that have been further exposed by the pandemic. Household incomes across the country have been significantly hit, and when many people have turned to the social security system for support they have had to suffer the five-week wait for a universal credit payment, forcing many to take on the extra financial burden of an advanced payment loan. To prevent increasing household debt, the Government should convert that loan into a grant. To get the economy back on its feet, people need money in their pockets, not increased debt.
The rise in the standard allowance for universal credit and working tax credits was a welcome introduction to support the UK’s most hard-up, but it makes no sense that the Government did not extend the increase to legacy benefits, which include critical economic support for disabled people. Analysis by the Social Metrics Commission found that nearly half of people in poverty, 48% or 6.8 million people, live in a family that includes someone who is disabled. More than four in 10 people, 41%, are in a family that includes both a disabled adult and a child and is living in poverty. To tackle rising poverty, legacy benefits need targeted support. As the Motor Neurone Disease Association told the Committee:
“the amount of financial support through Carers Allowance is not enough, especially at a time when now more than ever extra pressure is being placed on unpaid family carers.”
I fully support the Committee’s call for the DWP to ensure legacy benefits receive the same uplift in support as universal credit and working tax credits, but we must also go further. The Government must make the benefit uplift permanent, as the economic impact of the pandemic will continue for the foreseeable future.
The rate of local housing allowance is also insufficient to keep a roof over many people’s heads. Shelter research states that more than four in 10, or 42%, of private renting households now rely on LHA to pay their rent. It was a positive step to increase LHA to cover the lowest 30% of private rents, but it does not solve the problem as it still creates a huge chasm between the benefits many tenants receive and the rent they are contractually obliged to pay. Furthermore, the decision at yesterday’s spending review to maintain the cash value of LHA but not continue to link it to the 30th percentile of local market rents will worsen the situation by leaving LHA rates falling well behind the cost of private rents once again. I support Shelter’s call for a mechanism to be put in place to ensure that LHA continues to cover at least the 30th percentile of local market rents going forward.
Finally, I want to speak about the huge suffering caused by the no recourse to public funds status. I have heard from families who are recently unemployed or who have lost income about their desperate financial situation due to their no recourse to public funds status. As a volunteer at Luton food bank, I met people with no recourse to public funds who are relying on the foodbank to feed themselves and their children as they cannot access sufficient support. Sadly, this heartbreaking situation is not unique. Children’s Society research referenced in the Select Committee report estimates that about 142,000 children under 18 and 1 million adults are in this situation. It is not in the public’s interests to force people, many of whom are key workers and frontline medical staff, to adhere to restrictive public health guidance while also denying them access to the social security safety net. That is truly callous. Many of these families cannot work, as that would risk their loved ones’ health, but they also have no support system to fall back on. They are stranded in mounting household debt, living hand to mouth without any respite on the horizon, so will the Minister explain to the House and those suffering why the Government refuse to suspend the no recourse to public funds rules for DWP benefits?
Ms Karen Buck (Westminster North) (Lab)
I will start by congratulating the Select Committee on a superb report, as always, and on the introduction by the Chair of the Committee, my right hon. Friend the Member for East Ham (Stephen Timms). It will not be a surprise that I agree with everything he has said. In the middle of a crisis of this kind, it is very tempting to not welcome rigorous scrutiny and, indeed, challenge of the policies that are brought forward in response to it. However, it is even more important at these times that we hear that kind of scrutiny, which draws particular strength from being cross-party: we have heard contributions from both sides of the House on these important points.
Getting this right makes the difference when it comes to people having food on the table and being able to warm their homes, and being able to have a roof over their heads and communicate with each other—essentials of a basic but decent standard of living. It also means offering people security and dignity at a time of personal crisis, when their worlds are crumbling around them. Getting it wrong means debt, hunger, homelessness, and the fears, stresses and insecurities that can and do trigger mental and physical ill health. It is entirely possible for two things to be true at the same time: that the system has indeed handled, and handled well, a soaring number of claims for benefits, and that too many people are left in desperate need and, in some cases, total destitution. It is true that more money has been spent this year in response to this crisis, but also that the level of need is outstripping it, and it is certainly true that—as we learned yesterday—the temporary nature of so much of that assistance is leaving us with some profound concerns for what happens next.
It is absolutely right, as I think has been said by everybody who has spoken so far, that a debt of thanks is owed to the DWP staff, locally and nationally, supported by the work of voluntary organisations and other public bodies. People have gone above and beyond what is required of them, as they did during the financial crisis 10 years ago, when the system also rose splendidly to the challenge it was put under. As always, we owe our thanks to those dedicated staff.
It is no reflection on the work of the Department’s public servants to say that the effectiveness of the policy response itself has been more mixed. In part, that is because of the austerity policies pursued by the Conservative Government since 2010, which left the benefits system woefully unprepared for the impact of this crisis. Ministers like to boast about the £9 billion they have allocated to social security in response to the pandemic, but the Office for Budget Responsibility has confirmed that £9 billion is the amount taken out of social security by the Government in the 2015 Budget alone. The long history of failing to uprate benefits—the benefit freeze that we had for so many years—meant that between 2010 and the onset of the pandemic, the value of the main income replacement benefits—JSA, ESA, income support and universal credit—fell by 9% in real terms. We cannot ignore that this is the context of what we are now dealing with.
That is why it is also so concerning that we are hearing about measures that have been adopted since the start of this crisis being temporary. Several hon. Friends have made reference to the £20 uplift for universal credit. It is absolutely essential that the Government lift the threat that is hanging over millions of people who are reliant on a low income, and ensure that this uplift is made permanent. It is also essential, as my hon. Friend the Member for Luton South (Rachel Hopkins) in particular referred to, that the Government continue to increase the support available for people who have a housing need and are reliant on local housing allowance, which has also drifted further and further away from meeting real housing costs. The Government cannot ignore the relationship between that failure to meet genuine housing costs in many parts of the country and homelessness, which has soared over recent years. The local housing allowance must be related to real rents in the real world, in all parts of the country. We only just came out of a period of freeze of local housing allowance, and now we are told that we are going back into it.
In short, the social security system has been falling further and further away from living costs as a matter of Government policy for a long time. The increases in funding that we have seen this year are no more than a partial reversal of policy. As the Committee has stressed, the Government have taken a completely different approach to universal credit and working tax credit on the one hand, and to other legacy benefits on the other—a point also made by several hon. Friends—with the latter receiving only a 1.7% uprating after years of real-terms cuts. This affects 1.8 million people on ESA, nearly 300,000 people on income support, nearly a quarter of a million people on JSA, and more than 1 million working families receiving child tax credit but not working tax credit. On present trends, next year they can look forward to a 37p a week uplift in their benefits.
The Committee rightly condemned this unjustified disparity in the treatment of people in similar circumstances depending on whether or not they are receiving the Government’s flagship benefit. To argue, as Ministers have done, that this disparity is due to the greater flexibility of universal credit is particularly galling, as the Government are simultaneously pleading the inflexibility of universal credit as an excuse for not addressing the issue of advance repayments and the five-week wait. I can only echo the words of the Committee:
“We were astonished to hear that the Universal Credit system has been built in a way that makes it all but impossible for repayments of Advances to be suspended in a crisis situation.”
The Government’s response has been undermined by a failure to join up policy across Government. The pandemic has meant that the Department for Work and Pensions now plays an essential role in supporting public health policy, which is—or should be—a major shift in the Department’s priorities. If people are to comply with Government rules on social distancing and self-isolation, we need to ensure that they are able to do so and that the DWP is up to this task. That is why we have consistently called for the suspension of the no recourse to public funds rules for DWP benefits for the duration of this pandemic—a point that was stressed by my hon. Friends the Members for Leicester East (Claudia Webbe) and for Brentford and Isleworth (Ruth Cadbury).
The DWP has proved its operational ability to deal with unprecedented demands, but that effort has been severely hampered by the impact of austerity over many years, by the inflexibility of universal credit and by a failure to co-ordinate policy across Government Departments. Above all, the Government must ensure that the measures that have been taken over recent months in response to this crisis are not ended next April, and that they give security to millions of people who are looking to them.
The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)
I thank the Work and Pensions Committee for its report, which provides important scrutiny of the Department for Work and Pensions, and our response to the coronavirus outbreak. I thank all hon. Members for their contributions to today’s debate, and for their largely constructive tone. Of course, I also thank the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Stephen Timms), with whom I enjoy a constructive, if not sometimes challenging—and rightly so—relationship.
I will start with some comments on the performance of my Department over the course of the pandemic before moving on to some of the substantive points raised in the debate. I pay tribute to the tireless efforts of my Department’s civil servants, who have stepped up to the challenge with remarkable speed and aptitude when faced with overwhelming demand as a result of the unprecedented pandemic. I thank the Committee for its acknowledgement of the work of our hard-working frontline staff.
Let me offer an insight into the sheer volume of UC claims that we have faced. From 16 March to the end of April, we received over 1.8 million claims for universal credit. The legacy benefits system simply could not have coped with this demand. Rather than the queues in the streets that we would have seen with a paper-based legacy system, our payment timeliness ran at a record high, with over 94% of claims paid in full and on time, and more than 1 million individuals able to access funds quickly via new claim advances. We moved rapidly to roll out a package of emergency and temporary welfare measures, including the injection of billions of pounds into our welfare system this year to support those facing the most financial disruption because of the pandemic. That injection included a temporary increase to the universal credit standard allowance of more than £1,000 for this financial year. We also increased the local housing allowance rates for universal credit and housing benefit claimants to the 30th percentile of local rents from April; this vital financial support for private renters was worth on average £600 throughout this challenging period. We are, though, just one part of an overarching Government commitment to wrap our arms around the public.
Let me turn to the first of the points raised by the right hon. Member for East Ham, on the uprating of benefits and the UC standard allowance. The Secretary of State announced yesterday, as part of the annual review of social security rates, that benefits would again rise in line with inflation at the start of the next financial year. That is a cash increase of around half a billion pounds in 2021-22. We also affirmed the commitment that the increase to local housing allowance rates in April this year will be retained. Earlier this year we invested nearly £1 billion, increasing the local housing allowance rates to the 30th percentile of local market rents, and we will maintain that level of support next year by freezing the rates at current levels.
Let me address the question of the £20 universal credit uplift. The Government introduced a raft of temporary measures—including the furlough scheme, the self-employment income support scheme and, of course, the £20 universal credit uplift—to support those facing the most financial disruption. With the uplift confirmed until the end of March 2021, my right hon. Friend the Chancellor of the Exchequer set out yesterday why it is right that we wait for more clarity on the national economic and social picture before he decides on the best way to support low-income families from April. I stress to the House that discussions are very much ongoing with Her Majesty’s Treasury.
Let me turn to the second point raised by the right hon. Member for East Ham, on returning people to legacy benefits once they have moved over to universal credit. As a matter of fundamental policy design, making a universal credit claim will cease any entitlement to legacy benefits and tax credits that an individual may have. This function is supported in legislation and reflects the overarching principle of universal credit: that it will replace the legacy benefits system. The Department continually makes improvements to the UC service in response to feedback and user research. On 3 June, we introduced a new check-through box to remind claimants to check their eligibility before making a claim for universal credit, and to remind them that legacy benefits will cease when a universal credit claim is made and submitted and they will not be able to return to legacy benefits. I encourage claimants to check their independent eligibility calculators on gov.uk.
Let me turn to the third point raised by the right hon. Member for East Ham, on support for those with no recourse to public funds. Access to DWP income-related benefits such as universal credit flows from an individual’s immigration status. All claimants, regardless of their nationality, are required to be both legally and habitually resident in the United Kingdom in order to access income-related benefits. Ultimately, these matters are governed by the Home Office, and people without recourse to public funds can apply for a change of condition. I stress that support has been available, including through the coronavirus job retention scheme, the coronavirus self-employment income support scheme, the contributory employment support allowance and, of course, support via local authorities, including the new £170 million covid winter support grant, provided that the relevant eligibility criteria are met.
In the interests of time—I am conscious that it is very tight and we have Department for Work and Pensions oral questions on Monday—let me conclude by reiterating our commitment to providing a strong safety net for those who need it and targeting support at those most in need. I take immense pride in our Department’s response to the unprecedented challenges that this year has brought, and I know that the Department will continue to play a key role in delivering crucial services to society’s most vulnerable and disadvantaged over the coming months. As the recovery phase grows, the Department will continue to offer key services through our £30 billion plan for jobs. The Select Committee was right to acknowledge the exceptional work of our Department in supporting people through these unprecedented times, and I look forward to the important role that we will play in ensuring that we build back better in the coming months.
Mr Deputy Speaker (Mr Nigel Evans)
I thank everybody for their contributions and co-operation today, without a time limit being imposed. Everybody behaved impeccably—thank you.
Question put and agreed to.
Resolved,
That this House notes the First Report of the Work and Pensions Committee, “DWP’s response to the coronavirus outbreak”, HC 178; and calls on the Government to increase relevant legacy benefits in line with increases to universal credit, to take steps to return people who have been inadvertently left worse off under universal credit compared with their previous benefits, and to suspend the no recourse to public funds visa condition for the duration of the coronavirus outbreak.
Business without Debate
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text
Hydrogen Transport
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Alexander Stafford (Rother Valley) (Con)
I refer the House to my entry in the Register of Members’ Financial Interests. It is a tremendous privilege to have secured today’s debate on the use of hydrogen transport. It is such thrilling news because, unbelievably, this is the first dedicated debate on hydrogen to take place in the UK Parliament. We can all agree that it is long overdue.
It is now clear that hydrogen will be a critical component of our energy and transport policy as we strive to achieve net zero by 2050. We can no longer afford to sit on our hands. At present, 34% of all UK carbon emissions come from transport. This is a colossal statistic. If we do not prioritise decarbonising our transport sector, we simply will not meet our net zero target.
I welcome the work that the Minister and the Government have done and will continue to do to ensure that hydrogen is so high up the Government’s agenda. Indeed, the Government have signalled their intent regarding hydrogen in their 10-point plan for a green industrial revolution announced just last week. The Minister has confirmed that the Government will produce an economy-wide hydrogen strategy for the UK, which we understand is planned to be published in February. I look forward to the promised creation of a hydrogen transport hub, the all-hydrogen bus town scheme and implementation of the aforementioned 10-point plan, which includes policies for hydrogen use and production.
Members will be well versed in my advocacy for hydrogen in this House. I serve as a vice-chair of the all-party group on hydrogen and I champion hydrogen technology consistently in my speeches and articles on levelling up and our green recovery. My commitment to this exciting technology stems from my life prior to entering Parliament. Before I was elected to represent the people of Rother Valley, I worked on environmental issues at the World Wildlife Fund before focusing on the UK’s global transition to a green future at Shell. It was then that I realised we need a multi-pronged approach to low-carbon transport.
Despite what some may tell us, there is no silver bullet or panacea to help us to achieve our aims. This is why, alongside other solutions such as electric vehicles, biofuels and carbon capture and storage, we must ensure that we are at the forefront of the hydrogen industry, both in its use and in its production. We must steal a march on international competitors, cornering the market for UK plc and cementing our place as the world leader in hydrogen transport. I like to describe this as a win-win situation, because a strong UK hydrogen industry will create thousands of jobs across the country, cut carbon emissions dramatically and boost our post-covid and post-Brexit economy.
What exactly is hydrogen and how does it work? In layman’s terms, hydrogen is a gas that can combust in a way that produces no greenhouse gas emissions. Hydrogen can be produced by a number of methods. The most exciting of these creations is green hydrogen, which is made by electrolysis, using renewable electricity from solar and wind power. While we develop our infrastructure for green hydrogen, we can create blue hydrogen, too, which is made by reforming methane, where the carbon dioxide generated can be captured and stored.
I must address the excitement around electric vehicles, and it certainly is a wonderful technology. However, it is not the sole solution to decarbonising transport, and it has significant shortcomings that need to be addressed. It is estimated that it will cost £16.7 billion to get the UK’s public charging network ready for mass EV market. This would require 507 new charge points to be installed every single day from now until 2035. Furthermore, there is no recognised figure for how much it will cost to upgrade the grid, but industry figures suggest that it will require hundreds of billions of pounds.
Moreover, we must mention the need to import battery technology from the People’s Republic of China, a country that owns 73% of the world’s battery supply, often made with electricity from coal-powered stations. Ultimately of more concern is EVs’ unsuitability for heavier vehicles, such as HGVs, and longer-distance journeys, and I will cover that shortly. Hydrogen fuel cell electric vehicles, on the other hand, offer flexibility and freedom. Hydrogen vehicles do not produce any greenhouse gases from their tailpipe. The only emission is water vapour. If the hydrogen used by the vehicle is made with renewable sources of electricity or with the help of carbon capture and storage, the process of driving a hydrogen vehicle is nearly free of CO2 emissions, as well as other particulate matter.
In hydrogen vehicles, energy is stored as compressed hydrogen fuel. This means that hydrogen fuel cell electric vehicles can drive up to 700 km without refuelling and, just like a conventional car, they take only a few minutes to refuel. This is likely to see the deployment of hydrogen in cars and vans that travel large distances or for heavy utilisation, which battery EVs are unsuitable for.
I am excited about the prospects for hydrogen transport beyond cars. This is where hydrogen technology really comes into its own. A hydrogen fuel cell offers cleaner options for parts of the transport sector, particularly in larger vehicles that are less suited to electrification and where consumers demand rapid refuelling. The high energy density of hydrogen means that it is expected to be the dominant choice for HGVs, buses, shipping and rail, as well as its potential use in aviation.
Hydrogen buses show particular promise, and we are fortunate in Britain to boast the expertise of Wrightbus. It is currently building 3,000 hydrogen buses in the UK for use across the country by 2024, which is the equivalent of taking 107,000 cars off the road.
Stephen Flynn (Aberdeen South) (SNP)
I apologise for missing the start of the hon. Member’s speech on an incredibly important matter. He has touched on hydrogen buses, and in Aberdeen, the city I represent, hydrogen buses have been rolled out in great numbers over recent years. Does he agree with me that what we need to see is a greater expansion of hydrogen buses not just in Aberdeen, but across Scotland and the entire UK?
Alexander Stafford
I thank the hon. Member for that point, and I could not agree more. I was talking to the Under-Secretary of State for Scotland, my hon. Friend the Member for Banff and Buchan (David Duguid), about it recently, and it was exactly that point he highlighted.
That is exactly why, in February, when the Government announced 4,000 zero emission buses, I believe they should have been announced as hydrogen buses, because the economies of scale involved will revolutionise the transport sector. It is of paramount importance that we achieve cost parity between a hydrogen bus and a diesel bus, and at the moment such parity is predicted to happen this decade, but we would rather have that sooner than later, and if those 4,000 buses were hydrogen buses, I am told that the scales involved would mean parity with diesel buses.
In addition, it is essential that we reform the bus service operators grant to focus only on green fuels such as hydrogen, as we currently spend £600 million per year incentivising the running of diesel buses. Taking this decision would not cost the taxpayer a penny. We must also reform the renewable transport fuel obligation. A simple amendment to this would allow any existing renewable energy resource to be used, and again it would not cost the taxpayer any money. This would significantly increase private investment and stimulate the creation of new jobs in the production of green hydrogen for transport.
The HGV sector is the highest emitting of all commercial road transport with regards to absolute CO2 emissions. The majority of commercial vehicles in this category are still powered by diesel, and electrification, as I have mentioned, is not suitable for such heavy long-distance vehicles. Hydrogen-fuelled HGVs had been found to be a more cost-effective option in terms of the infrastructure costs, with a cumulative capital expenditure cost of £3.4 billion in 2016, compared with £21.3 billion for battery electric vehicles—so a lot cheaper. Hydrogen HGVs have already been trialled in the US and parts of Europe, and they are likely to be widely available in the 2020s.
On our railways, a hydrogen-powered train from the University of Birmingham recently travelled on Britain’s rail network for the first time. We are looking to lead the world in rolling out more hydrogen trains. In the aerospace sector, British company ZeroAvia has conducted the world’s first hydrogen-powered flight, over Bedfordshire, and in 2021 Aeristech will provide a fuel compressor that will make it possible to deliver the power output needed for even the heaviest industries and vehicles, such as aeroplanes. In shipping, UK shipbuilders are already working on cutting-edge zero-emission ferries, and we must increase our international co-operation on hydrogen to achieve the decarbonisation of routes globally.
Beyond transport, hydrogen can also be used to decarbonise home heating, given that home heating currently amounts to about 20% of national emissions. The UK is leading the way once again, with HyDeploy conducting the world’s first trial of a 20% hydrogen blend in the gas grid, H21 and H100 leading groundbreaking tests of 100% hydrogen in the gas grid, and Worcester Bosch and Baxi producing the world’s first hydrogen-ready boilers, so we are already developing this technology in this country.
UK innovation in hydrogen is further advanced by Johnson Matthey’s role as one of the global leaders in fuel cell development and components in transport. In fact, its technology ends up in roughly a third of fuel cells globally. I stress to the Government that this is an opportunity for us to corner the hydrogen market in the way that China has dominated the battery market. We can take a world lead on this, and we should—we have the right situation.
Another great British company is ITM Power, based in South Yorkshire, next to my constituency. It is involved in most hydrogen transport products in the UK, and it has indicated that it wishes to open a large hydrogen refuelling station and a network across the country. We must ensure that we have a strong domestic programme to support this, particularly in the bus and HGV sectors. If we act with pace and ambition, with collaboration between industry and Government, we can utilise our natural resources, technological know-how and innovative entrepreneurial spirit to spend taxpayers’ money more efficiently than our competitors and stimulate much greater private investment, economic growth and carbon reductions than any other country on the planet.
I have four policy asks of the Minister. The first is to set ambitious targets for the mass commercialisation of hydrogen technology. Hydrogen technologies across all categories have been used extensively in real-world situations across the world for many years. The opportunity now exists to set targets for mass deployment and commercialisation of these technologies across the UK over the coming decade, as other countries have already started doing. For example, Japan is aiming for 200,000 hydrogen fuel cell vehicles on the road by 2025 and 800,000 by 2030. It is also aiming for 1,200 hydrogen buses by 2030. South Korea is aiming for 100,000 hydrogen fuel cell vehicles on the roads by 2025 and 60,000 hydrogen buses by 2040. The world is waking up to hydrogen, and so should we.
The second request is to stimulate supply and demand in parallel. We can steal a march over other countries by setting inspirational, investment-stimulating goals for the production of hydrogen and do so in a manner that maximises the UK’s natural resources, academic skills, world-leading manufacturing and experienced workforce. The Prime Minister has set a target for a minimum of 5 GW of hydrogen production by 2030. Let us set ambitious demand-side targets for buses, trains and cars to ensure that we make full use of that.
The third ask is to focus initially on regional clusters—for example, in Rother Valley. The UK’s hydrogen economy must be built up step by step, and we cannot make this transition instantly. The Government should focus initially on regional clusters that are most suited to hydrogen production and usage and on technologies that can be implemented quickly, scaled up effectively and suit the local skills, geography and decarbonisation priorities. The announcement of a hydrogen transport hub in Teesside is welcome, and I hope that we will see more hydrogen hubs pop up soon—across the north but also in Scotland, Northern Ireland and Wales.
The fourth ask is to ensure that relevant Government Departments work collaboratively. Hydrogen policy covers many different Departments. It requires strong local leadership from metro Mayors, council leaders and local enterprise partnerships to be delivered. All the devolved Administrations are developing their own hydrogen strategies.
Stephen Flynn
I appreciate the hon. Member giving way again; he is being very generous. I am listening closely to his four points. I may have missed it, but I am not sure whether he mentioned his preference for green or blue hydrogen, and I would be grateful if he expanded on whether he feels that green hydrogen is ultimately the goal that we all seek to achieve.
Alexander Stafford
I believe the hon. Member missed the earlier part of the debate, when I touched on green and blue hydrogen. We all want green hydrogen eventually, but it is blue to start off with, with carbon capture and storage.
I urge the Government to bring forward another world first: a hydrogen political working group consisting of representatives from the UK Government, devolved Administration Ministers, Mayors and council leaders. This group can ensure that hydrogen policy across the UK is co-ordinated and implemented at pace.
We must act quickly and decisively to avoid being left behind by international competitors. In the past few months, Germany has committed €9 billion to hydrogen, and France and Portugal have committed €7 billion. The European Union is planning hundreds of billions of euros in investment in hydrogen technology. Australia, China, South Korea, Japan, Canada, Norway, Chile and many other countries around the world see hydrogen as critical to their immediate economic growth and long-term net zero goals. The UK must make its move now if we are to pip those countries at the post. They have announced this money. Let us get the money on the ground first and develop it.
Overall, about 20 countries that collectively represent about 70% of global GDP have announced a hydrogen strategy or a road map as a key pillar of their decarbonisation ambitions. We have only to look to the race for dominance in the battery industry to see why we cannot allow ourselves to fall behind today. For instance, today there are 136 battery mega-factory plants in operation or being planned. Some 101 of those are in China, and eight are in the USA. China is opening almost one new mega-factory every single week. The UK has well and truly lost out in the battery industry, but we are still in the race for hydrogen, and we can still win.
It is apparent why so many countries are clamouring to pursue a hydrogen transport agenda. The global hydrogen economy is set to be worth $2.5 trillion and create 30 million jobs by 2050. The economic benefits for the UK are huge, especially for industrial areas, such as my constituency of Rother Valley. Here in the UK, the Hydrogen Task Force believes that hydrogen can add £18 billion in gross value added by 2035 and support 75,000 additional jobs. More immediately, businesses have told the Treasury that it has £3 billion-worth of shovel-ready private investment awaiting the right policy frameworks and commitment from the Government.
That is fantastic news for constituencies in the northern powerhouse and the devolved nations. The Zero Carbon Humber project is a fantastic example of the potential of so-called hydrogen hubs, which I envisage in areas such as the Rother Valley and across the red wall. The Humber is the largest carbon-emitting industry cluster in the UK, and like South Yorkshire, much of the Humber’s economy is built on manufacturing, engineering and the energy sector. A partnership of 12 major organisations and a bid to the Department for Business, Energy and Industrial Strategy has resulted in the creation of an ambitious project to make the Humber the world’s first net zero carbon industrial cluster, supporting new industry and encouraging factories.
Addressing jobs first and foremost, the potential for a hydrogen revolution in South Yorkshire to rival the coal industry is immensely exciting. We have already made great strides in establishing ourselves as a national hub for the production of green hydrogen. Rother Valley’s manufacturing expertise remains second to none, and our ambition and drive are matchless. It is those skills that we hope to redeploy in the green revolution, and as such there is no better place to serve as the hub of the hydrogen industry.
For instance, I have been supporting the upcoming opening of the world’s largest electrolyser factory, operated by ITM and located in Meadowhall, Sheffield, which is on the border of my constituency. Hydrogen storage cylinders are also manufactured nearby. Rotherham, part of which is in my constituency, is home to England’s most northerly hydrogen refuelling station. The region has an onshore wind sector with the potential to expand. It is key to the production of green hydrogen, and our local city of Sheffield has two major district heat networks. Recently, I met the University of Sheffield’s Advanced Manufacturing Research Centre, which is a world-leading hub of research and innovation in technologies such as hydrogen.
However, that is only the beginning. As we attract more investment and the local hydrogen industry grows, more companies will want to take advantage of our infrastructure, creating manufacturing jobs, graduate jobs and supply chain jobs alike. In turn, South Yorkshire stands to reap high economic returns that will rejuvenate the local economy. Indeed, I intend to turn Rother Valley into Britain’s hydrogen valley.
I conclude my speech by emphasising the importance of using hydrogen as one part of our carbon-free transport future. No one technology alone is the answer, because each option is at a different stage of development and the economics of each are different depending on the mode of transport. The case for hydrogen is irrefutable, particularly for heavy duty, long-distance vehicles such as heavy goods vehicles and buses. Decarbonising those modes of transport is vital to meeting our net zero targets.
A world-leading hydrogen industry will boost the local and national economy, providing an uplift in these challenging times, and bolster UK plc as we export our expertise and technology around the world. The UK has all the tools required for leading the hydrogen revolution. We must ensure that we seize the moment and take our rightful place as the capital of hydrogen transport. I look forward to working with the Minister and the Government as we march towards a cleaner, greener hydrogen future for all parts of the United Kingdom.
The Parliamentary Under-Secretary of State for Transport (Rachel Maclean)
I heartily congratulate my hon. Friend the Member for Rother Valley (Alexander Stafford) on securing this excellent Adjournment debate. I cannot believe it is the first debate we have had in the House of Commons solely on this topic, but I am sure it will not be the last.
Virginia Crosbie (Ynys Môn) (Con)
I congratulate my hon. Friend the Member for Rother Valley (Alexander Stafford) on securing this important and timely Adjournment debate on hydrogen transport and his role in championing the hydrogen sector. It allows me to put on record the role Ynys Môn can play in the hydrogen economy. There are significant cost implications spanning the creation of this new industry, not least the sheer amount of infrastructure that must be built to create, store and transport hydrogen. One of the easiest ways to cut costs is to locate as much of the supply chain as closely together as possible. Anglesey is no stranger to the concept, and in the 1970s an aluminium smelting plant was built near the port of Holyhead.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. I will allow the hon. Lady to finish, but it sounds like she is making a speech rather than intervening. She clearly has a point that she wishes to make to the Minister, so I will allow her to do so.
Virginia Crosbie
The Minister has allowed me to speak for two minutes. This has been agreed with the Minister.
Madam Deputy Speaker
An intervention should be about 30 seconds. Two minutes is a speech.
Madam Deputy Speaker
If the Minister has already agreed, the hon. Lady can finish her intervention, but this is not an intervention—it is a speech.
Virginia Crosbie
Thank you, Madam Deputy Speaker.
Anglesey is no stranger to the concept I mentioned. In the 1970s, an aluminium smelting plant was built near the port of Holyhead, allowing alumina ore to be easily offloaded from cargo ships to the site, which was in turn powered by reliable, cheap and clean electricity from Wylfa nuclear power plant. That symbiotic relationship brought decades of jobs and prosperity to the island.
That ethos could be replicated again with the establishment of a hydrogen cluster, seeing its electrolysers supplied by a new generation of nuclear from Wylfa Newydd or by offshore renewable energy, creating a consistent supply of low-carbon green hydrogen, which could be used locally, exported around the world or transported within the UK. All these efforts on the energy island represent the joint vision of Menter Môn, Bangor University and the Menai science park. They could kick-start a new industry in north Wales, allowing the creation of synthetic fuels for aviation, shipping and agriculture, and making Anglesey a truly net zero island.
We must pursue the path that gives the greatest certainty of reaching net zero, and I was glad to see the role that nuclear power will play in that highlighted in the Prime Minister’s 10-point plan last week. Alongside nuclear, the second of his 10 commitments was to drive the growth of low-carbon hydrogen. That important commitment from the Government needs to be followed by action, to reassure private investors that the Government are serious.
I look forward to seeing the vision that will be set out in the upcoming energy White Paper and in the hydrogen strategy that was spoken of in the Prime Minister’s 10-point plan, both of which the Minister and those in other Departments have been working hard on.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. I just make the point that there has clearly been a misunderstanding here. The hon. Lady thought she was going to make a speech. Everyone else thought she was intervening. I have allowed her to make a speech. Let me make it absolutely clear for the record that I am not setting a precedent. There has been a misunderstanding, so let us just smooth it over.
Rachel Maclean
Thank you very much, Madam Deputy Speaker. I am grateful for your guidance on the matter.
I thank my hon. Friend the Member for Rother Valley very much indeed; he made an absolutely excellent speech highlighting his vast range of expertise on this important topic, which is based on his prior experience and on his role in the all-party parliamentary group on hydrogen.
As is clear from the points raised not only by my hon. Friend but by my hon. Friend the Member for Ynys Môn (Virginia Crosbie) and the hon. Member for Aberdeen South (Stephen Flynn), this technology provides a vast and exciting opportunity for our nation. Our world-leading researchers, innovators, engineers and vehicle manufacturers are already putting the UK at the forefront of this new era in transport technology, but we want to keep aiming higher, pushing further and, in particular, harnessing the potential to build back better.
Last week, the Prime Minister set out the 10-point plan for a green industrial revolution, which I am proud to say contained several key transport policies, including £20 million to support the development of cost-effective zero-emission HGVs in the UK; £20 million to help develop clean maritime technology as part of the clean maritime demonstration programme, which will take place at key sites, including Orkney and Teesside; further investment in research and development on the infrastructure upgrades required at UK airports to move to battery and hydrogen aircraft; and £3 million for the recently announced Tees Valley hydrogen transport hub, to which my hon. Friend the Member for Rother Valley referred.
In the Department for Transport, we intend to build on those announcements through our forthcoming and ambitious transport decarbonisation plan, which will set out how we intend to reduce emissions and deliver transport’s contribution to net zero by 2050. There is little doubt that the compelling case for green hydrogen set out by my hon. Friend the Member for Rother Valley has been heard by the Prime Minister and the Department for Transport. It will play a key part in meeting that goal and in helping to decarbonise the wider economy. We are committed to exploring what that role might be.
We are already investing up to £121 million in hydrogen innovation, supporting a range of projects in heating, transport and the production of low carbon hydrogen, with carbon capture utilisation and storage, and electrolysis technologies. Furthermore, our £23 million hydrogen for transport programme is increasing the uptake of fuel-cell electric vehicles and growing the number of publicly accessible hydrogen refuelling stations.
We are already seeing the possibilities of hydrogen being demonstrated right now, often with the help of Government funding. In the maritime sector, for example, a range of exciting projects is taking place: a company in Lowestoft called Windcat Workboats is leading work to develop hydrogen-fuelled zero-emission vessels; and in the Orkney Islands, Government-supported trials are exploring the use of renewably sourced hydrogen to fuel ferries.
Birmingham’s first hydrogen train, the HydroFLEX, has been built by the University of Birmingham and rail company Porterbrook with the support of a £750,000 grant from the Government. In the skies, US start-up ZeroAvia is using a £2.7 million Government investment to develop a hydrogen-fuelled powertrain that is being demonstrated on a small aircraft.
Since 2015, we have also funded £7.4 million through the low emission bus and the ultra low emission bus schemes to provide 62 hydrogen buses and infrastructure. The Prime Minister confirmed our commitment to deliver 4,000 zero-emission buses in his 10-point plan, backed up with £120 million to kick off this programme in 2021. I note that the hon. Member for Aberdeen South has made a clear request for those buses to be in Scotland. No doubt that has been heard. In Northern Ireland, bus company Translink bought a fleet of double-deckers built by Wrightbus which are powered by hydrogen generated from local onshore wind energy.
My hon. Friend the Member for Rother Valley rightly poses many challenges. Hydrogen provides us with enormous opportunities, but it also presents us with equally important questions: how do we manufacture it in a sustainable and cost-effective way? How do we enable hydrogen-powered transport technology to scale up and get cheaper? How can we make hydrogen a real and viable option for transport operators? To help answer those and other questions, we are developing a transport hydrogen hub in Tees Valley—the first of many perhaps, as my hon. Friend will be glad to hear. It will support and develop cross-modal applications of hydrogen in transport.
Rachel Maclean
My hon. Friend will not be surprised to hear that I was expecting that question. I have noted very carefully his desire for Rother Valley to be a hydrogen valley. I will consider his request carefully.
Across Government, we are looking to accelerate the use of hydrogen in transport and its development. We have commissioned a master plan—we are cracking on with this work—which will outline options for hydrogen supply and storage infrastructure and support innovation facilities ahead of going through business case and planning processes in 2021, with a view to tendering industry for the infrastructure build in 2022. I will be happy to meet my hon. Friend to discuss the case that he is making in more detail in future.
In closing, I thank my hon. Friends the Members for Rother Valley and for Ynys Môn very much for their continued interest in the role that hydrogen can play to support decarbonisation. I will of course consider carefully the policy asks laid out by my hon. Friend the Member for Rother Valley. We have committed to publishing a comprehensive UK hydrogen strategy in early 2021, which will bring together the UK hydrogen story, showcasing activity to date and setting out an action plan for decarbonisation and expansion in the 2020s. Let me assure everyone that hydrogen has a future in transport and in levelling up Rother Valley and the whole of the United Kingdom.
Question put and agreed to.
Draft Protocol on Ireland/Northern Ireland (Democratic Consent Process) (EU Exit) Regulations 2020
(4 years, 1 month ago)
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The Chair
Before we begin, I will mention social distancing again, although you are all sitting in the correct allocated spaces, and when the main Benches were full everybody correctly sat in the Public Gallery at the back.
The Minister of State, Northern Ireland Office (Mr Robin Walker)
I beg to move,
That the Committee has considered the draft protocol on Ireland/Northern Ireland (Democratic Consent Process) (EU Exit) Regulations 2020.
It is a pleasure to serve under your chairmanship, Ms McVey. I put on record my thanks to House staff for the work that they have done to make this Committee Room safe for Members in the current difficult circumstances and, indeed, for doing so for the many statutory instrument Committees that we have dealt with recently.
The regulations fulfil a simple but important task: to reflect in domestic law the consent mechanism set out in the Ireland/Northern Ireland protocol and the UK Government’s unilateral declaration of 17 October 2019. The Belfast/Good Friday agreement is built on the principle of consent. It was ratified by referendums in Northern Ireland and Ireland, and the agreement is crystal clear that any change in the constitutional position of Northern Ireland within the United Kingdom can come about only if the majority in Northern Ireland consents to that change. The vital importance of consent is recognised in the provision for alignment in the protocol to be disapplied if Northern Ireland’s political representatives conclude that it is no longer desirable. Embedding that recognition of consent in the protocol was intrinsic to its acceptance by the Government.
The protocol was designed as a practical solution to avoiding a hard border on the island of Ireland, while ensuring that the UK, including Northern Ireland, could leave the European Union as a whole. The protocol necessarily included a number of special provisions that apply only in Northern Ireland for as long as the protocol is in force. That is why it is for elected representatives in Northern Ireland to decide what happens to the protocol alignment provisions in a consent vote that can take place every four years, with the first vote taking place in 2024. Only elections to the Northern Ireland Assembly and the vote of Members of that Assembly will decide the outcome.
If the draft regulations are approved, the first consent process will take place in 2024. If consent is given at that point, the process will then be repeated every four or eight years—four years if consent is given with a simple majority, eight years if consent is given with cross-community support. This demonstrates that the mechanism is designed to encourage cross-community support, giving the Assembly the opportunity to provide eight years of certainty to Northern Ireland’s businesses and individuals through cross-community agreement.
I have heard arguments that this approach is somehow contrary to or not compatible with the Belfast agreement, and I do not accept that that is so. Our approach is entirely compatible with the agreement. The principle of cross-community support set out in the Belfast agreement applies to internal matters for which the Northern Ireland Assembly is responsible. The consent mechanism, contained as it is in the Northern Ireland protocol, relates to the UK’s continued relationship with the EU, an excepted matter in Northern Ireland’s devolution settlement. That means that the matter at hand falls outside the remit of the Assembly and outside the principle of requiring cross-community support to pass. We have taken the steps we have, with four versus eight years, to incentivise that support.
The regulations implement both the default consent process and an alternative consent process. The default consent process will apply if the First Minister and Deputy First Minister are in office on the day the Secretary of State issues the notification to begin the process—that is, for the first occasion, on 31 October 2024. By contrast, the alternative process will apply if at that point or any future such points the First Minister and Deputy First Minister arere not in office. It should be recalled that the protocol was drafted at such a time, and although we welcome the restoration and subsequent stability that the Executive has achieved, it is right that we have such a fall-back in place.
The alternative process enables any MLA to bring forward the consent motion in the absence of the First Minister and Deputy First Minister. It also puts in place a process to enable the consent vote to take place under the alternative process, even if the Assembly were unable to elect a Speaker when required to do so. That ensures that MLAs will always be able to take a decision on a consent motion, discharging the obligation in international law to facilitate that process.
The Government remain fully committed to implementing the withdrawal agreement and protocol, which were specifically designed to protect the Belfast/Good Friday agreement and the huge gains of the peace process. That is why the alignment provisions within the protocol depend for their legitimacy on consent. That ensures that democratically elected local politicians will decide the future of the protocol in Northern Ireland. By making the regulations, we will ensure that this can be delivered for the people of Northern Ireland, and I therefore commend them to the Committee.
Karin Smyth (Bristol South) (Lab)
It is a pleasure to serve under your chairmanship, Ms McVey. I echo the Minister’s thanks to the various House staff who have allowed us to meet today and on other occasions.
We are here today because we have with the Irish Government a joint and solemn responsibility to the people of Northern Ireland. Although Brexit divides the UK and Ireland into different economic blocks, the protocol sets out our need to have regard to the historic ties, recognises the unique and significant challenges that exist on the island of Ireland, and emphasises that to ensure democratic legitimacy there should be a process of consent—the subject of the regulations before us today, which we support. The instrument looks like a dry, technical piece of process legislation, but it is much more than that.
We have real concerns on which I seek assurances from the Minister. They centre on the unsatisfactory nature of the fact that we are agreeing here in Westminster a process for those elected to Stormont to agree a voting mechanism on a deal that we do not yet have. It invokes the principle of consent and notions of democracy, on which I take issue with the Minister. We also have concerns about the destabilising nature of the timing of the votes.
First, we are agreeing a process today for consent to something that we do not know: the operation of articles 5 to 10 on customs and goods across the island of Ireland. I will not rehearse all the things that we do not know with only 36 days to go, but, as has been the case in the past four years, the lack of certainty and the way in which the delicately balanced unique circumstances of Northern Ireland have been treated does not bode well, and it is not acceptable for the Government to ask us to agree legislation without having agreed what the arrangements are in 36 days’ time.
Secondly, I want to highlight the use of the word “consent” by the Government. In the Command Paper, “The UK’s Approach to the Northern Ireland Protocol”, published in May 2020, the foreword highlights on page 3 that,
“The Belfast Agreement is built on the principle of consent.”
The next paragraph states:
“The vital importance of consent is recognised in the provision for alignment in the Protocol to be disapplied”,
as the Minister has said, and that
“Embedding that recognition of consent…was intrinsic to its acceptance by this Government.”
That is a clear signal, as the Minister outlined, of the linkage of the 1998 agreement and this SI. On the next page, the Chancellor of the Duchy of Lancaster talks about protecting the “Belfast (Good Friday) Agreement” , which is referred to on page 5.
Language matters, particularly in the context of Northern Ireland. The Minister knows that every word of every document is carefully crafted and rigorously studied. There are many examples from the past year of how this democratic consent mechanism has been used to placate the Brexiteers in his own party and the entirely legitimate concerns of Unionists about what the Prime Minister agreed to in order to secure the withdrawal agreement.
This SI deliberately invokes the carefully crafted principle of consent about the constitutional issue from the 1998 treaty, but it is a different mechanism. It is designed for a different purpose and it would have been better to have perhaps used different nomenclature. I know the Minister argues that the mechanism is different. It is passable by a majority vote, because one is part of an international treaty and one enacts something into domestic law, but, having linked the two for political expediency, retreating into legalese and hair splitting is not helpful to trust in the Government’s intent.
The word “democratic” is also invoked carefully here. Indeed, writing in The Belfast Telegraph, the Chancellor of the Duchy of Lancaster and the Secretary of State said of this proposal,
“Critically, any arrangements for implementing the Protocol will only be able to last as long as they command the support of democratically-elected local politicians. The future is firmly in Northern Ireland's hands.”
Patently, that is not the case. In this negotiation between the UK and the EU, Northern Ireland has never been in control, and this statutory instrument simply allows Assembly Members to agree—or not—to what others have negotiated. The UK Government’s proposal to mitigate the impact of UK Government policy and future alignment—or not—with the European Union is also a UK Government political decision.
To reverse some of the damage to trust in relationships in the past four years, there has to be a more serious commitment by the UK Government to real democratic oversight of the entire protocol, within the context of the 1998 agreement, by the people of Northern Ireland. I have asked several times of this and previous Governments how the enactment of the backstop and now the protocol interplays with the provisions of the north-south and east-west provisions of the Belfast/Good Friday agreement, and I have never had a good answer.
The Joint Committee, the Specialised Committee and the joint consultative working group, plus the process to consent to something that we do not already know, make the whole issue much more problematic and in need of resolution. We need a commitment to be clear on the interrelationships of those bodies and how the Northern Ireland voice is heard and counts, and an assurance that the future really is in the hands of the people of Northern Ireland. I would like the Minister to outline any further thoughts that the Government have on how and when that can happen.
We are also concerned about the destabilising nature of the process, which the Minister has outlined without the context. Article 18 offers the opportunity of a vote, but the SI essentially forces one—it says there will be a vote. The Minister may wish to clarify that, but we might need to consider some flexibility, because the timing and process of a vote within the current electoral cycle is concerning. We have Assembly elections in 2022 and the consent vote that we are debating in November or December 2024. I remind hon. Members that we are also due a general election at that time.
If there is a simple majority in the consent vote in 2024, a two-year review of the articles in the protocol takes us to 2026. It is then two more years to another vote in 2028. If it is rejected in 2024, there will be a need to reopen negotiations on avoiding a hard border, repeating the circular and damaging debate of the last four years, between 2024 and 2026. There is also the prospect of more Assembly elections in 2027. If the consent vote that is part of the SI is approved in 2024, there will be another vote in 2032. That is a long process and a deeply concerning prospect.
There are too many opportunities for division. As we hear from the Government that they are seeking to move away from alignment with the European Union, it appears inevitable that, under their watch, those divisions will continue to be laid bare in Northern Ireland. How much consideration have the Government given to the electoral cycle and the timetable proposed in the SI? What will they be doing to avoid the economic and political instability it portends?
We all need a deal, and one that means that all the difficulties of separation between our two countries are minimised and that the provisions in the SI are part of the dull and technocratic process that the Government are keen for us all to believe in. The signs are not promising, however, and I hope that the Minister will reflect on the issues I have raised. I hope he is assured, however, that the Opposition are ready to do all we can to ensure that we uphold our solemn commitment to the people of Northern Ireland to a strong economy and to peace, stability and reconciliation in the coming difficult years.
Mr Walker
I am grateful to the hon. Member for Bristol South, who spoke, as always, with great knowledge and passion on these issues. She has made a number of important points. I agree about our responsibilities to the people of Northern Ireland and about working in a constructive way. She referred, a little unfairly, to a deal that we do not yet have. It is important to reflect that, when we are talking about the protocol, this is the deal that was negotiated and agreed between the UK and the EU, and that we are implementing and delivering on. That is part of the fact that we left the European Union with a deal in place earlier this year. I recognise, however, that her point is really that the nature of its impact will depend on the overall deal. Of course, we all hope that there is progress on that in the coming days and weeks.
The hon. Lady made the point about the importance of timing in the process. I recognise that whatever the timing we announced for it, there would be sensitivities and an interaction with the electoral cycle. The regulations that we are debating achieve it in the simplest way by saying that we agreed to a four-year consent mechanism, which applies four years after the deal was effectively done. However we designed it, there would be some interaction with elections somewhere in the UK. It is right, therefore, to default to a simple process.
Of course, we want to support and incentivise the opportunity for cross-community support through the design of the system, which allows for an eight-year process. That would separate it perhaps a little further from the regular patterns of elections across the UK or in Northern Ireland. That provides the opportunity, if it can be demonstrated that the protocol is working effectively, that it can win cross-community support and that it has Assembly Members behind it, to separate it from some of the challenges.
The review mechanism also plays an important part in that and is part of the way in which the consent process encourages the best possible cross-community agreement. That is why if the resolution passes with cross-community support, the next consent decision would be eight years after the first. There is a strong incentive there, not just for Northern Ireland parties, but for the UK Government, to generate the widest possible support for the protocol and Northern Ireland’s unique arrangements.
If the consent mechanism passes with only a simple majority, the UK Government will initiate an independent review into the functioning of the protocol and the implications of any decision to continue or terminate alignment on social, economic and political life in Northern Ireland. The hon. Lady rightly made the point that there are already many Committees and independent reviews to discuss and look into these matters, but the key to the review is in paragraph 8 of the unilateral declaration:
“The independent review will make recommendations to the Government of the United Kingdom, including with regard to any new arrangements it believes could command cross-community support.”
That provides an opportunity to foster and build support. Cross-community support is our aim. We want the protocol to command the widest support possible across Northern Ireland. If in 2024 the consent resolution passes with only a simple majority, we would use the outcome of the independent review to continue to work towards further cross-community support for what would then be a subsequent consent decision in 2028.
As I said in my opening speech, the Government remain fully committed to implementing the withdrawal agreement and the protocol. As ever, our intent and our purpose is to protect the Good Friday/Belfast agreement. That intent was at the heart of our negotiations with the EU last year and is reflected in this consent mechanism. It is something that we will always uphold. Through the mechanism, we ensure that the question of continued alignment with EU law will be decided by those democratically elected to represent the people of Northern Ireland.
Question put and agreed to.
Draft Human Medicines (Amendment etc.) (EU Exit) Regulations 2020
Draft Medical Devices (Amendment Etc.) (EU Exit) Regulations 2020
(4 years, 1 month ago)
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The Chair
Good morning. Before we begin, I remind Members to observe social distancing and only sit in places that are clearly marked. Hansard colleagues would be most grateful if all Members sent their speaking notes to hansardnotes@parliament.uk after the sitting.
The Minister for Health (Edward Argar)
I beg to move,
That the Committee has considered the draft Human Medicines (Amendment etc.) (EU Exit) Regulations 2020.
The Chair
With this it will be convenient to consider the draft Medical Devices (Amendment etc.) (EU Exit) Regulations 2020.
Edward Argar
It is always a pleasure to serve under your chairmanship, Mr Rosindell.
The statutory instruments concern the regulations for human medicines and medical devices. They form part of a legislative programme to ensure there is a functioning statute book at the end of the transition period to provide certainty for businesses and the public. Most of the changes they make are technical in nature.
It is a pleasure, as ever, to serve in Committee opposite the shadow Minister, the hon. Member for Nottingham North. We have become something of a double act in these Delegated Legislation Committees covering the legislation for the end of the transition period.
I believe that everyone in this Committee Room shares the Government’s intention to protect patient safety and preserve patients’ access to innovative new treatments. That could not be more important than in the context of the covid-19 response. The statutory instruments have been developed to maintain our world-leading standards in the regulation of medicines and medical devices now that we have left the European Union and as the transition period comes to an end.
The statutory instruments broadly achieve three things: they make minor amendments to existing regulations to take account of the implementation period agreed under the withdrawal agreement; they implement our obligations under the Northern Ireland protocol; and they implement specific policy changes to the regulatory regime in Great Britain to ensure that the regulatory framework is up-to-date and functioning correctly at the end of the transition period. The regulations do not prevent the need for future changes, but preserve the solid foundations of the UK regulatory environment to ensure patient safety—something I suspect the shadow Minister will speak about—and to ensure that the UK remains one of the best places in the world for science and innovation.
I will mention briefly the most notable policy changes that the instruments set out in law, for the benefit of Members. The instruments are long and technical, so I am unable to address all elements of them in the time available, but I will endeavour to cover the main points.
The medical devices instrument will allow us to maintain the current standards of regulation. We will ensure that patient safety and health outcomes are not adversely impacted, and we will continue to recognise the CE marking on medical devices and in vitro diagnostic devices, which have demonstrated their conformity with EU regulatory requirements, for a further two and a half years. That approach is both sensible and pragmatic. It provides time for industry to adapt to future regulations and eliminates any delay in access to devices for UK patients, while maintaining continuity.
A policy change that I note for the Committee is the adoption of the new conformity assessment marking for medical devices. The Government have created their own product safety marking, which will be used across goods regulation. The UK conformity assessment—UKCA—mark will be available for industry to use for devices placed on the market in Great Britain from the end of the transition period.
The medical devices instrument, as it applies to Great Britain, removes certain provisions from the previous EU exit instrument, which would have inserted regulations similar to the EU’s medical devices regulation, or MDR, and in vitro diagnostic regulation, or IVDR. That is because the full application of the two EU regulations will now fall outside the transition period.
The independent medicines and medical devices safety review, which delivered its report in July, highlighted the importance of strengthened regulations that do more to protect patients. The regulations, as amended by the medical devices instrument, will be built on using the powers of the Medicines and Medical Devices Bill, which is currently continuing its passage in the other place.
The Bill will provide the opportunity to develop a robust, world-leading regulatory regime for medical devices that prioritises patient safety and innovation. Our plans are in development, and will take into consideration both international standards and global harmonisation in the establishment of our future system. We will of course consult closely with stakeholders within the life sciences and healthcare sectors on that future regime.
I now turn to the human medicines instrument to note a few further changes that will help the UK to maintain its excellent regulatory system for medicines and clinical trials. From 1 January 2021, marketing authorisations granted by the EU will continue to apply in Northern Ireland; however, all medicines to be placed on the market in Great Britain must be authorised through the UK national route.
The human medicines instrument allows the Medicines and Healthcare products Regulatory Agency to have regard to decisions taken by EU member states on products approved via decentralised and mutual recognition procedures when considering whether to authorise those products in Great Britain. That policy is to ensure that the UK can continue to take effective regulatory and safety action on those products.
The instrument will also ensure that novel and innovative medicines continue to come to the UK market after the end of the transition period. That will be achieved by allowing recognition of decisions by the European Medicines Agency to grant UK marketing authorisations for centrally authorised products.
Both the human medicines and the medical devices instruments uphold the Prime Minister’s commitment to unfettered access for Northern Ireland’s businesses to the whole of the UK market. In doing so, they provide for transparency requirements for medicines and medical devices moving from Northern Ireland to Great Britain, which will allow the MHRA to maintain oversight of products on the GB market and thus protect patient safety.
For medicines, the MHRA will still retain regulatory powers, such as carrying out a targeted assessment of a medicinal product where it is deemed necessary for safety reasons. For medical devices, non-UK manufacturers placing devices on the UK market will be required to appoint a UK responsible person. The UK responsible person will be required to register devices with the MHRA in accordance with a transitional timetable set out in the regulations.
To fulfil the requirements of the Northern Ireland protocol, both instruments make relevant changes to ensure that the relevant EU laws will continue to apply in Northern Ireland after the end of the transition period and, additionally, the instruments grant the MHRA powers to continue to regulate medicines and devices in Northern Ireland in order to ensure that there is clear continuity for patients and businesses.
Members will be aware that the MHRA charges fees to cover the costs associated with the regulation of medicines. To reflect the regulatory changes that will take effect after the transition period ends, the instrument reduces some of the fees to ensure that they will still be commensurate with the cost of the work performed by the MHRA.
The devolved Administrations have been kept informed of the drafting of the instrument, and I put on record my gratitude for their continued collaborative approach. In particular, I thank the Minister of Health in Northern Ireland, Robin Swann, who agreed, despite policy for human medicines being a devolved matter, that the human medicines instrument should be signed solely by the Secretary of State for the Department of Health and Social Care.
We have also been working closely with industry through the development of the statutory instruments. In September and since then, we have published a number of guidance documents that go into further detail on those changes on gov.uk. We have held an accompanying series of webinars to engage directly with more than 11,500 industry representatives, providing them with an opportunity for their questions to be asked and answered. My officials continue to meet regularly with the major industry suppliers and key trade associations, including the Association of the British Pharmaceutical Industry, the BioIndustry Association and the Association of British HealthTech Industries.
It is also important to note that the instruments amend pre-existing EU exit legislation made in 2019, taken through on behalf of the Opposition, I think, by the hon. Member for Ellesmere Port and Neston (Justin Madders)—the other half of the Opposition double act on these instruments. A full consultation process was conducted for the pre-existing legislation and, moreover, full impact assessments were conducted for the underlying legislation.
As the nature of the changes in the instruments that we are discussing today are in many instances technical, the impact of the instruments, above and beyond the existing legislation, is not assessed to meet the threshold for further impact assessments; hence they have not been provided for. I commend the draft regulations to the Committee.
Alex Norris (Nottingham North) (Lab/Co-op)
It is a pleasure to discuss these instruments under your chairship, Mr Rosindell. As the Minister says, we have had a rolling tour of them in recent weeks, but happily we seem to have a rotating supporting cast, other than the Whips, so I can just about get away with repeating some of the same arguments.
I will start, as always, by saying that we are getting very close to the final opportunity for the deal with the EU that the Government promised to finalise. I know that business desperately wants no deal to be taken off the table, and will be looking at the proceedings with interest. Perhaps the Minister will update us on the progress. I suspect that he will say it is “ongoing”, as he generally does.
As has been set out, the draft regulations amend the post-Brexit regulatory framework for medicines and medical devices respectively to implement the Northern Ireland protocol and ensure that the UK meets its related obligations under that agreement. That is, of course, a necessary step towards maintaining the UK’s obligations—necessary, critically, to ensure that people are kept safe when using medicines and medical devices.
We will not divide the Committee, but I have a few areas where I would like greater clarity. At the heart of this is patient safety, which is important to all of us; however, I think we have detected a waning in the Government’s commitment in this area in recent months. It has now been four months since Baroness Cumberlege published the independent medicines and medical devices safety review. Campaigners for that review were ignored and derided, some for many decades, but with the publication of that report they were vindicated.
We are four months on. Frankly, the Government have sat on it. Campaigners got an apology on the first day, but have been unable to get a word out of the Government since. We cannot get anything by the written question route either. It is exceptionally disappointing. I know that the Government have a lot on, but the failure even to pick up the phone to talk to those who suffered and give them an update adds insult to injury. I speak to people affected each week, and they are heartbroken by the Government’s response.
Will the Minister make a commitment that he will prod and urge his relevant colleague to consult campaigners as a matter of urgency? I honestly would not let the day finish without doing that. The hurt is really significant. Will he also commit the Government to using the remaining stages of the Medicines and Medical Devices Bill to implement the relevant recommendations? It is a perfect vehicle for us to act quickly, and we really ought to do so.
The first set of draft regulations, regarding human medicines, amend the Human Medicines (Amendment etc.) (EU Exit) Regulations 2019 and the Human Medicines and Medical Devices (Amendment etc.) (EU Exit) Regulations 2019, as the Minister said, as well as the Medicines for Human Use (Clinical Trials) (Amendment) (EU Exit) Regulations 2019. The 2019 regulations themselves amended the Human Medicines Regulations 2012, the Medicines for Human Use (Clinical Trials) Regulations 2004 and the Medicines (Products for Human Use) (Fees) Regulations 2016. They set out what the basis for the regulation of medicines and clinical trials will be in Great Britain from 1 January, and the draft regulations ensure that the 2019 regulations will remain effective at the end of the implementation period, which is, as I say, very important.
As well as making some technical amendments, the instruments will reverse some of the changes made by the 2019 regulations to limit them to Great Britain, while EU law will remain in effect in Northern Ireland, and implement policy changes to Great Britain’s regulatory regime only. As we would expect, EU marketing authorisations will now authorise sale or supply in Northern Ireland only, and UK marketing authorisations will no longer automatically apply for the whole of the UK. That often gets lost, but it is a very significant change.
I understand that the MHRA will have provision to pay regard to decisions taken by EU member states when making licensing decisions, but could the Minister explain what impact he thinks it will have on the MHRA in terms of the burden of its work when authorising products entering Great Britain? Will there be extra checks? Will there be extra pre-assessments?
Similarly I understand that, due to industry feedback, products used in clinical trials, investigational medicinal products, will no longer need to be certified by a qualified person—a QP—at both ends, which presumably would have increased the administrative burden twofold. Instead, the whole of the relevant UK manufacturer’s authorisation for import licence will simply have to ensure that any IMP has been QP certified by someone based in an approved country. There is a year before that comes into place, but could the Minister guarantee that it will not have a significant impact on the safety of the investigational products and of those using them in the trials? If so, how does he know that, and on what basis has he formed that decision?
Changes are made to a number of areas, but time is limited and I need to move on to the other draft regulations. I will conclude on this element with a slightly more general question. For absolute on-the-record clarity, can the Minister say that he is confident that the changes will not make users of medicines less safe, or leave UK businesses in a situation where they cannot compete? Those are the two points very much in play. I do not think that anybody, either in this room or in the country more generally, thinks that either of those possibilities would be a good thing, so clarity on the record about the judgment that he has made on that would be very helpful.
The draft medical devices regulations also amend the 2019 regulations to ensure that the regulatory landscape is fit for purpose at the end of the implementation period and, importantly, to keep us safe. Schedule 1 amends the principal regulations to ensure that devices placed on the Northern Ireland market meet EU legislation under the protocol. It also makes provision for persons placing devices on the market in Northern Ireland to register devices and for manufacturers of devices to appoint a UK responsible person where there is no other presence.
We talked much about the UK responsible person when considering the Medicines and Medical Devices Bill, because we know that there have been sharp practices previously. I am keen for the Minister to provide clarity and to commit to ensuring that people are not using responsible persons in name only. We know of examples of a single person, who seems to have very little connection to the businesses, being the responsible person for all manner of products, when their employment is in no way related to them. I am keen to hear any reflections on that.
The Minister discussed the UK conformity assessed marking. This is, of course, a significant moment. The assessments will be carried out by UK approved bodies, which will be converted from UK notified bodies by this instrument. What impact will that change have on the bodies and their capacity to make conformity assessments?
We support the continuation of the CE marking. That was a wise decision by the Government. I am interested to hear how the period of two and a half years was arrived at. I would like to hear an on-the-record commitment from the Government that there will be no risk to the supply of medical devices as a result of the conformity assessment.
Finally, the explanatory memorandum states:
“The MHRA will seek to minimise the legislation’s impact by providing guidance”.
Will the Minister say when that will happen and what other steps are being taken to support the MHRA in this process? The MHRA, which has always been important, is now a crucial body.
When it comes to the safety of medicines and medical devices, we are now on a high tightrope. We used to have the common eyes of the notified bodies of our EU partners looking at our products; now we will look at them alone. That is the decision that has been taken, but it means that if there is one mistake, there is no backstop. It would therefore be much appreciated if the Minister gave a sense of the capacity of the MHRA and its readiness to take on what is an absolutely crucial function.
Edward Argar
I am grateful to the shadow Minister for his typically reasonable and measured comments. He repeated a number of questions that are familiar to me, but he did not repeat his jokes from previous Committees, which is a relief for hon. Members. I will deal with his points in order.
In respect of a deal or a future relationship agreement, the hon. Gentleman knows me very well and can predict my response. I will, of course, say to him that the negotiations continue, and it would be wrong to prejudge them. However, I know that Her Majesty’s Government continue to negotiate actively and positively with the European Union.
The hon. Gentleman is right in his key point about the importance of patient safety. I reassure him that the Minister for Patient Safety, Mental Health and Suicide Prevention is, as he will know, a passionate advocate for patient safety. She takes it incredibly seriously both in her role as a Minister and given her background in medicine and nursing—it is deeply important to her. As I speak, I suspect she is on the Front Bench with my right hon. Friend the Secretary of State. I will certainly pass on the hon. Gentleman’s request and comments in respect of the Cumberlege review when I see her after the statement.
The hon. Gentleman reflected on a number of other factors. He often asks me in these Committees, quite reasonably, whether we are going to deliver our obligations under the Northern Ireland protocol. I reassure him that this is the penultimate Delegated Legislation Committee—we have one more to go—in fulfilling this Department’s obligations under the protocol by putting through the necessary regulations.
The hon. Gentleman asked for reassurances. I reassure him that I am confident that these statutory instruments and the regime that follows the end of the transition period will not make patients less safe and will not have a negative impact on our life sciences sector and businesses. The whole approach we are adopting in this country is to strengthen patient safety and put it at the heart of what we do, while also supporting our fantastic life sciences sector and its competitiveness and innovation. I reassure him of my confidence that we will continue to deliver on those objectives.
On responsible persons, the hon. Gentleman rightly said it is important that that process and that individual do the job they are there to do, and do it properly. He mentioned the period of two and a half years on top of the transition period. That was reached in discussion with industry about what it needs and with the regulators about how to make the transition to a new regime effective.
Finally, the hon. Gentleman talked at length about the MHRA and asked several questions, so I will spend a few minutes responding to them. He will be aware that the UK has substantial capacity and expertise to regulate and evaluate the quality, safety and efficacy of medicines and medical devices. The MHRA is expert in many areas, including the licensing of medicines, pharmaco- vigilance and clinical trials regulation. That already provides benefits to patients. The MHRA is the lead regulator on more than 3,500 medicines currently on the EU market.
The hon. Gentleman asked about the impact on the MHRA and its workload. I reassure him that it will receive additional funding of just under £13 million by the end of March next year to help it prepare for the end of the transition period and meet its obligations under the regulations. Among other activities, that is being used to fund investments in new and improved IT systems to enable better regulation of medicines and medical devices in Northern Ireland under the protocol. It has also contributed to additional staffing requirements to manage all aspects of the new regime to which he alluded.
The MHRA is taking robust steps to ensure that it is ready to continue to perform, as it always has done, at the highest level, putting patient safety first, and we have given it the resources to do that.
Question put and agreed to.
Draft Medical Devices (Amendment etc.) (EU Exit) Regulations 2020
Resolved,
That the committee has considered the draft Medical Devices (Amendment etc.) (EU Exit) Regulations 2020.—(Edward Argar.)
Ministerial Corrections
(4 years, 1 month ago)
Ministerial CorrectionsRead Full debate Read Hansard Text
Housing, Communities and Local Government
(4 years, 1 month ago)
Ministerial CorrectionsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Christopher Pincher
He also refers to leasehold reform. A leasehold reform White Paper will be forthcoming. Perhaps we may, at that time, be able to debate the advantages and disadvantages of the Scottish system and see where we are able to learn from them and possibly they are able to learn from us.
[Official Report, 24 November 2020, Vol. 684, c. 696.]
Letter of correction from the Minister for Housing, the right hon. Member for Tamworth (Christopher Pincher).
An error has been identified in the response I gave to the hon. Member for Glasgow East (David Linden).
The correct response should have been:
Christopher Pincher
He also refers to leasehold reform. Leasehold reform legislation will be forthcoming. Perhaps we may, at that time, be able to debate the advantages and disadvantages of the Scottish system and see where we are able to learn from them and possibly they are able to learn from us.
Leaseholders and Cladding
The following is an extract from the statement on leaseholders and cladding on 24 November 2020.
Christopher Pincher
The leasehold system and its reform will form part of a Government White Paper and separate debates in this Chamber, and I am sure that the hon. Lady will play her part in those.
[Official Report, 24 November 2020, Vol. 684, c. 702.]
Letter of correction from the Minister for Housing, the right hon. Member for Tamworth (Christopher Pincher).
An error has been identified in the response I gave to the hon. Member for Newcastle upon Tyne Central (Chi Onwurah).
The correct response should have been:
Christopher Pincher
The leasehold system and its reform will form part of separate Government legislation and separate debates in this Chamber, and I am sure that the hon. Lady will play her part in those.
Transport
(4 years, 1 month ago)
Ministerial CorrectionsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Rachel Maclean
The hon. Lady referenced the haulier handbook. This is one part of our plan to make sure that all this information is one place. The handbook will be translated into 18 languages and it will be ready very soon. It is already available on gov.uk, and we will also be making hard copies available in 43 information and advice sites, which are opening up and down the country.
[Official Report, 23 November 2020, Vol. 684, c. 648.]
Letter of correction from the Under-Secretary of State for Transport, the hon. Member for Redditch (Rachel Maclean).
An error has been identified in the response I gave to the hon. Member for Bristol East (Kerry McCarthy).
The correct response should have been:
Rachel Maclean
The hon. Lady referenced the haulier handbook. This is one part of our plan to make sure that all this information is one place. The handbook will be translated into 14 languages and it will be ready very soon. It is already available on gov.uk, and we will also be making hard copies available in 43 information and advice sites, which are opening up and down the country.
Financial Services Bill (Seventh sitting)
Thursday 26th November 2020
(4 years, 1 month ago)
Public Bill CommitteesRead Full debate Financial Services Bill 2019-21 View all Financial Services Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 26 November 2020 - (26 Nov 2020)
The Chair
Before we begin, just a few reminders: please switch electronic devices to silent; no tea and coffee during sittings; and, again, I thank everybody for observing the social distancing regulations. As you have seen, the spaces are marked and now cannot even be moved, so there is no excuse for not social distancing. The Hansard reporters would be grateful if Members emailed any electronic copies of their speaking notes to hansardnotes@parliament.uk.
We continue now with line-by-line consideration of the Bill.
Clause 8
Review of which benchmarks are critical benchmarks
Mr Pat McFadden (Wolverhampton South East) (Lab)
I beg to move amendment 28, in clause 8, page 7, line 38, at end insert—
‘(7) In reviewing critical benchmarks in accordance with Article A20 of the Benchmarks regulation as amended by this Act the FCA must have regard to—
(a) ensuring a benchmark is based on actual trades or contracts;
(b) preventing a benchmark from manipulation for the benefit of anyone submitting information to that benchmark; and
(c) robust sanctions up to and including custodial sentences for anyone found to be engaged in manipulation or attempted manipulation of a benchmark.’
This amendment would require the FCA to have regard to ensuring a benchmark is based on actual trades or contracts, that it is not open to manipulation and that robust sanctions are in place for those who manipulate, or attempt to manipulate, a benchmark.
Thank you for your chairmanship today, Mr Davies. Perhaps with your indulgence I may, as I did the other day, explain how I shall try to approach this morning’s sitting. I believe that within a sometimes impenetrable Bill the clauses we are to debate this morning may be the most impenetrable. That is often the case when clauses change provisions elsewhere, as in this instance. I shall, as I go through my remarks on the provisions, ask the Minister some questions. The real meat will come at about clauses 13 to 16, and I will speak for a bit longer. I just want to give the Committee the shape of my approach.
To return to the amendment, it begins, I guess, with LIBOR. I want by way of illustration to ask the Committee to think about the price of bread. If we were all asked what the benchmark price of a loaf is, it would be easy to establish it. We would go to a supermarket, look on the shelf, and see the price of a loaf. If we were keen shoppers with a good eye for a bargain, we might go to two or three supermarkets and compare the price of a loaf. I could pop-quiz the Committee, but I shall not put anyone through that.
The price of a standard loaf in one of our supermarkets is roughly £1.10, give or take; people who want to go for one of those sourdough loaves can pay a bit more if they want, but for what I would call a normal brown loaf it is about £1.10. That is the benchmark price of a loaf, dictated by the supply and demand of a competitive supermarket environment.
Now I want Members to imagine a different way of setting prices, where we were setting the price of a loaf and could all submit our opinion on what the price of the loaf might be—and we owned bakeries, and were selling loaves. We would have a debate every day to set the price of bread. Perhaps the Minister and I would converge on about £1.10, but someone else might say, “Look, could we just edge that price up? Could you do me a favour and make today’s price £1.11 or £1.12? It would be a really good favour and, by the way, if you do it I might send you a case of champagne at Christmas.”
The trader might be saying those things in the knowledge that they had a lot of loaves to sell that afternoon—maybe millions. The penny difference in price could make a great difference to the profit. Alternatively, a benchmark price of £1.09 instead of £1.10 could mean that they would lose a lot of money on the bread they had to sell. That is basically what was happening with LIBOR. That is the problem that was unveiled.
The problem is exacerbated where there is not a liquid market for bread and where the benchmark relies more and more on what our oral witnesses last week called “expert judgment”. That is one phrase for it, but we could also call it opinion, and if we did not have supermarkets selling millions of loaves every day and the price of bread was down to the opinion of only the bakers, we can see there would be the potential for price manipulation.
That is what was happening with LIBOR and what was uncovered as traders around the world shaved tiny proportions off the daily rates. The volume of money being traded meant that even a tiny proportion—0.01% or something like that—could make a huge difference to their own trading account over the course of the year. That is the problem that this set of clauses is trying to deal with.
How do we deal with the problem? We focus a lot on what the Bill calls the representativeness of the benchmark, because there is not really a problem when millions of loaves are being sold and there is a competitive environment; if I do not like the price at Tesco, I can go to another supermarket and try my luck elsewhere. But when wholesale markets were not very liquid and relied more and more on expert opinions, there was the potential for—indeed, the reality of—manipulation. That is what happened.
That matters because this benchmark underpins trillions of pounds’-worth of trades, yet was found to be vulnerable to the kind of manipulation I have just tried to illustrate. I have tried to show that even the tiniest movement in the daily benchmark could make a big difference to traders because of the volumes of money that they were trading. The benchmark’s flaws were exposed a number of years ago, yet its use to underpin trading has persisted because of the volume of contracts linked to it.
One of the problems in the complexity of this set of clauses is that it takes us into the area of contract law, which is both complex and, in this case, international. Huge volumes, contract law and international jurisdictions are involved, so—to be fair to the regulators and the Treasury—it is not easy to get this right. Our amendment does not try to get into the contract issue, which we will come to later when we debate a few clauses further on, but rather tries to set out some ground rules for the regulator in establishing and sanctioning successor benchmarks to LIBOR.
The criteria that we have set out ought to be uncontroversial. The first is that the benchmark should be based on actual trades in the market for which real prices were paid. I confess I have been away from the issue for a while, although I served on parliamentary inquiries into it some years ago, but we learned last week that those so-called expert judgments are still being used to set LIBOR prices. That is someone’s opinion of what a trade might cost, not necessarily what it does cost in a real marketplace. That use of expert judgments has created the potential—and, as we have seen, more than the potential—for manipulation.
We also learned that SONIA, the sterling overnight index average and the favoured successor to LIBOR in the UK, is based on much more liquid markets. That is a good thing, but there is also a potential problem. LIBOR is an internationally used benchmark. While we are debating this legislation, the United States is also legislating, the European Union has parallel legislation and the Swiss have parallel legislation—and they have all gone for slightly different successors. That raises the problem, which the Minister and I will get into discussing: how to take contracts based on an internationally used benchmark and try to ensure fairness to those who signed up to contracts under it when the countries legislating for successors to it are all choosing slightly different overnight rates for those successors.
The amendment, therefore, goes with the grain of how trades are moving. We all agree that a benchmark based on large liquid markets will be more accurate than one based on opinion. The second and third elements of the amendment give the regulator a duty to prevent manipulation by those submitting information to the benchmark and to have robust sanctions, including custodial sentences, when that occurs.
We will get back to debating that elsewhere in the Bill. When the LIBOR scandal unfolded some seven or eight years ago, I remember that both the Treasury Committee and the Parliamentary Commission on Banking Standards heard evidence from chief executives of the major banks. Often, their defence was, “I had no idea what my traders were doing. I did not know that they were doing this.” There was a constructive ignorance built into the system. Although that did not make the chief executive look good, it was far better than the chief executive admitting that they knew what the trader was doing but they looked the other way because it was making more profit for the bank and the trader. The sanctions and the responsibility up through the institution are very important.
All that is hugely important for trust in the system. The average constituent probably does not know much about LIBOR or what it does, but the truth is that the financial products they buy are often related to this benchmark, so it does have an impact in the real world. No matter how esoteric the financial products are—they have become too esoteric—in the end there is a customer, and the customer should only pay a fair price. The imbalance of information should not result in the customer being fleeced or the trader being unfairly enriched, and it is the job of the regulator and the financial institution for which that trader works to ensure that is the case. That is the intention behind our amendment: to set that as a clear goal for the regulators before we get into the meat in the clauses of how we will transition from LIBOR to other kinds of benchmarks.
The Economic Secretary to the Treasury (John Glen)
It is a pleasure to serve under your chairmanship again, Mr Davies. I appreciate the opening remarks of the right hon. Member for Wolverhampton South East and his compelling attempt to contextualise the complexity of the scrutiny of the clauses that we will undertake this morning. In that spirit, it might be helpful if I contextualise for the Committee what benchmarks are, what the LIBOR benchmark is and where we are with the EU benchmarks regulation before I respond to the Opposition amendment.
A benchmark is a standard against which the performance of a fund can be measured or by reference to which payments can be calculated. They are most commonly found in financial instruments, but are used to compare a variety of products, from commodities—oil, gold and diamonds—to the weather. The most widely used benchmarks are interest rate benchmarks, such as LIBOR, the Euro Interbank Offered Rate and SONIA. They reflect interest rates for inter-bank lending and borrowing. They are regularly calculated and made publicly available. As was mentioned, they are used in a wide array of financial instruments used in global financial markets. They also have a use in trade, finance, valuation, accounting and taxation.
Stella Creasy (Walthamstow) (Lab/Co-op)
It is wonderful to serve under your chairmanship, as ever, Mr Davies. The Minister is explaining that there is a process for enforcement. We all know that this issue is very specialist. If he thinks the current regulations and sanctions are appropriate, could he set out how they are being enacted and monitored? Frankly, it requires someone with a specialist understanding of how these rates can be manipulated to enact them in the way he outlines. If he does not want to add the amendment, could he explain how these issues can be investigated, and what resources there are to do that?
John Glen
I thank the hon. Lady for her point. These matters are administered by the FCA. I have set out the framework under which it operates. Its resourcing is a matter for it, and I speak on a six-weekly basis to the chief executive about that. The sanctions available to the FCA vary considerably according the nature of the breaches. Some will be small, modest technical breaches.
Stella Creasy
The Minister has set out the criminal sanction. I am interested in whether there is support and resourcing expertise in relation to the criminal element, as opposed to the regulatory element.
Stephen Flynn (Aberdeen South) (SNP)
It is a pleasure to serve under your chairmanship, Mr Davies. I will be brief. The Minister has made a compelling case, but perhaps not as compelling as that made by the right hon. Member for Wolverhampton South East, who made illuminating remarks on the potential price of bread, although I encourage him to go to Aldi, where he will get it for a lot cheaper than £1.10.
What is proposed here is a common-sense approach that would give the wider public confidence that the Government are taking this matter seriously, notwith- standing the Minister’s remarks thus far. In general terms, I do not think there is a huge difference between the two positions, but looking at both sides, I think the common-sense approach would be to tighten this process and make it more robust; that would provide the public with the confidence they feel they need on these matters, particularly given the scale of past scandals.
Mr McFadden
I listened carefully to what the Minister said. I do not think anyone looking at the issue would conclude that the responsibility for these actions had been fairly allocated, so there is an issue. I am not saying we want to go around looking to put people’s heads on spikes—we do not want that sort of politics—but it does rankle with our constituents when certain types of crime that are, candidly, easier to understand are met with heavy punishments while somebody who does a very complex crime that is more difficult to understand can somehow get away with it.
Having said that, I accept that legislation for criminal offences, and particularly for custodial sentences, needs to be very carefully drafted in exactly the right way, and I cannot say that I am 100% certain that my amendment is, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
John Glen
Clause 8 is the first of 14 clauses that amend the benchmarks regulation in order to provide the FCA with the powers it needs to oversee the orderly wind-down of critical benchmarks such as LIBOR. Critical benchmarks are benchmarks that meet certain criteria—for instance, they are used in a significant volume of transactions, or the benchmark is based on submissions by contributors, the majority of whom are located in the UK. A number of powers in the benchmarks regulation are limited to the oversight supervision of critical benchmarks or the administrators of such benchmarks.
Clause 8 adds new criteria for what may be designated as a critical benchmark. As a result, a benchmark will be considered critical if its cessation would cause significant and adverse impacts on market integrity in the UK, even where the benchmark has market-led substitutes, provided one or more users of the benchmark cannot move on to a substitute. The new test means that, as a critical benchmark winds down, the value of contracts that use the benchmark diminishes. The powers available to the FCA to manage the wind-down of critical benchmarks will remain available, provided that the benchmark meets the relevant tests to remain designated as a critical benchmark.
In addition, one of the existing tests for what may be designated as a critical benchmark has been changed. The test originally stated that a benchmark would be designated as critical where it met either both a qualitative and quantitative threshold of use in more than €400 billion-worth of products, or the qualitative threshold only. The quantitative threshold has now been removed, as it has become redundant. This measure has been welcomed by industry as an important development in managing LIBOR transition, and will ensure that the FCA has the powers it needs to manage the orderly wind-down of this critical benchmark.
I am aware, as a result of my engagement with industry—indeed, the Committee heard evidence of this last week—that there is support among market participants for additional safe harbour provisions to complement the provisions in this Bill. I can assure the Committee that we are committed to looking into that further issue and providing industry with the reassurance it needs. That conversation is ongoing and, I think, is to the satisfaction of the industry; we are working to a conclusion with it. However, given what I think the Committee will concede is the complexity of the matters involved, I cannot commit to an outcome, and I think the industry recognises that.
Abena Oppong-Asare (Erith and Thamesmead) (Lab)
I want to go back to what happens if moving to another benchmark is “not reasonably practicable”. I note that the Minister is looking into that and seeking reassurance. One thing that we are particularly concerned about in this clause is the question of whether “one or more users”, if it is reasonable and practicable, can switch to a market-led substitute benchmark. How do the Government define what is reasonably practicable in this case? Will he explain that to me, please?
John Glen
I am grateful to the hon. Lady for her question. In terms of the benchmark’s being classed as critical and the appropriateness of substitutes, certain contracts face barriers to moving off a benchmark. While some contracts are bilateral and that renegotiation may be possible, many contracts are multilateral and involve the consent of multiple parties before a change can be made. Therefore, in some cases, achieving consensus on the changes is likely to be difficult or impossible, due to the absolute number of parties that will be involved, or due to the threshold at which consent would be achieved. In those situations the existence of an appropriate substitute is not relevant, as users will not be able to move on to it. The complexity of what they are on means that there is not anything substitutable.
Abena Oppong-Asare
On the point about the Government making a direct evaluation, if the benchmark user argues that it would not be reasonably practical to move to a market-led substitute, but the Treasury disagrees with that, what recourse does the user have to challenge this decision?
John Glen
These matters will be governed by protocols with the industry. The industry would have a dialogue with the FCA, through which these matters would be resolved. There would be a dispute, I would imagine, about the number of contracts, the number of people involved in those contracts, and the readiness of an available alternative. Usually, these matters would be resolved through dialogue and consultation.
Abena Oppong-Asare
That is really helpful, in terms of the dialogue with the FCA. Will a process be followed to ensure a fair system is applied with regard to substitutes that disagree with the Treasury process, or will how it is done be judged at that time?
John Glen
The complexity of these contracts and their reference to these benchmarks necessitates ongoing dialogue. There is a significant team in the FCA that deals with this work. The industry has been very concerned about this. This is a live, ongoing conversation. Given the context, and the history that the right hon. Member for Wolverhampton South East and I set out, and how appalling this situation was previously, there is wide consensus that this should be done in an open and collaborative way. This regulation will be used in that spirit.
Alison Thewliss (Glasgow Central) (SNP)
Paul Richards from the International Capital Market Association, who gave evidence last week, said there were around 520 legacy bond contracts to be moved over, and only 20 had been converted in the market so far, because it is a difficult and time-consuming process. Is there more the Government could be doing to reassure and help? Does the Minister envisage bringing forward any amendments to make this any easier? It sounds like this process will cost the markets money.
John Glen
I thank the hon. Lady for her question. The evidence from the ICMA last week underscored the ongoing complexity and challenges of this. It may be that legislation will be required in a future Session, but that would be subject to a resolution. There is no point of crystallisation from the industry; it is not compelling us to bring something forward. There is no resistance on the part of the Treasury to doing that; it is a question of working out what would be appropriate for the market. That dialogue will continue, and the Government will respond in the appropriate way in due course. I think the gentleman who gave evidence last week was appropriately making the Committee aware of that ongoing additional dialogue regarding that safe harbour provision. But there is no point of conflict between the Treasury and the industry on this matter.
Mr McFadden
The questions asked by my hon. Friend the Member for Erith and Thamesmead expose the potential for litigation if the Government and regulators are moving contracts from one basis to another; some of the people involved will have deep pockets and expensive lawyers. The Minister tells us that it will all be sorted out—thrashed out—and I hope he is right; but I am not sure that we can guarantee that.
I have a couple of questions about the clause and those clauses that follow. First, is it all about LIBOR, even though it talks about critical benchmarks, or is it more general? For example, might the provisions be used on a benchmark related to the price of a particular metal, or something like that? For our understanding of the matter, should we, wherever the provisions refer to a critical benchmark, just be thinking about LIBOR—because that is what we really mean; and is there some parliamentary drafting reason why the Bill does not say that?
Secondly, the clause deals with a review of which benchmarks are critical benchmarks. The Minister said, and the clause says, that that seems to be a benchmark for which a market-led substitute exists, although for some reason it is not practical to transfer activity to such a market-led substitute. That is what is confusing about the clauses. We are told that the policy decision, and the regulatory decision, is to move away from LIBOR and to cease using it by the end of 2021. That is my understanding. Yet it seems that the clauses both facilitate that and facilitate the continued use of such benchmarks.
My reading of the clause and the one that follows is that the FCA will retain the power to compel organisations to submit information to a critical benchmark, even though the policy decision has been made to move away from that benchmark. The question then is why the regulator would want to do that, and what the power means for the 2021 LIBOR end date. Does the power mean that the FCA could compel submitters to keep submitting information to LIBOR, and is that because so many contracts depend on it? Is that really why the power to continue submitting information to critical benchmarks is engaged in this? What I am really asking is whether the clause is putting the brakes on LIBOR or, in some ways, continuing a facilitation of LIBOR after the end of 2021, for some things.
John Glen
In the UK, LIBOR is the only critical benchmark. However, for reasons that the right hon. Gentleman has alluded to, we do not want the provision to be on just the LIBOR benchmark. For reasons to do with the type of legislation that that would mean—private legislation referring to something specific—a different process would be created. We have to use benchmark legislation—benchmark regulations; but LIBOR is what it pertains to. That is the only critical benchmark in the UK.
A mechanism to compel panel banks to continue to submit data beyond the end of 2021 does not exist. We have to be able to wind down in an orderly way and make provision for continuity, which is needed for the tough contracts that continue to exist and will need some reference point. We need to do that in a way that satisfies the market and maintains stability. It is in that context that we are giving the FCA the powers.
Question put and agreed to.
Clause 8 accordingly ordered to stand part of the Bill.
Clause 9
Mandatory administration of a critical benchmark
Question proposed, That the clause stand part of the Bill.
John Glen
Clause 9 amends article 21 of the benchmarks regulation, which concerns the mandatory administration of a critical benchmark.
Article 21 gives the FCA the power to compel the provision of a critical benchmark where the administrator notifies the FCA of its intention to cease providing the benchmark. Clause 9 amends article 21 to increase from five to 10 years the maximum period for which an administrator can be compelled by the FCA to continue to provide the benchmark. This will increase the time which the FCA has to manage the wind-down of a critical benchmark.
Under the clause, if the FCA decides to compel an administrator to continue publishing the benchmark, the FCA must assess the capability of the benchmark to measure the underlying market or economic reality and inform the administrator in writing of the outcome of this assessment. The FCA’s assessment that a critical benchmark is no longer representative of its underlying market, or is at risk of becoming unrepresentative, is the first step in providing the FCA with its wider powers to manage the wind-down of such a benchmark. We therefore wish to ensure that the FCA can take steps towards starting the managed wind-down of a critical benchmark in circumstances where the benchmark administrator itself proposes to cease the benchmark. I recommend that the clause stand part of the Bill.
Mr McFadden
The clause takes us, in a sense, to the next step after a review. Again, I have a couple of questions. First, subsection (2) refers to a period of 10 years. The Minister made clear a few minutes ago that LIBOR is definitely winding up by the end of 2021, so to what does 10 years refer? With something that is supposed to be winding up in one year, I still cannot quite understand why we are giving the regulator powers to continue it in a form for up to 10 years. I am confused about that, and I do not know if I am the only one.
Secondly, subsection (3) refers to an assessment of a benchmark. That assessment revolves around the question of the representative nature of the benchmark. It says that the FCA will always give either
“a written notice stating that it considers that the benchmark is not representative of the…economic reality”—
perhaps it has become too illiquid, in the way we discussed, or too reliant on expert opinion—or
“a written notice stating that it considers that the representativeness of the benchmark is not at risk.”
In other words, we have a good competition going here for the price of the bread. Does the 10-year period of extended mandatory information apply when the FCA has judged that the benchmark is not representative, or could it apply in cases where it is judged that it is representative as well? Subsection (3) seems to indicate that the assessment could go either way. I am trying to get at what this 10-year power is for and to which kind of benchmark it applies.
John Glen
I thank the right hon. Gentleman for his entirely reasonable and appropriate questions. The compulsion period of 10 years is about having a timely period to continue with the revised methodology of the synthetic LIBOR. One of the main aims of the Bill is to provide an appropriate mechanism for the wind-down of LIBOR and to reduce the risk of contractual frustration in the event of an unplanned or sudden cessation of LIBOR. To enable a managed wind-down of LIBOR, it may be necessary for the FCA to compel the benchmark administrator to continue to provide the benchmark for a period of time, to allow a portion of LIBOR-referencing contracts to mature and end. We expect a significant number of outstanding LIBOR legacy contracts at the end of the five-year compulsion period, and those outstanding contracts will still pose a material financial stability risk, as the Financial Stability Board noted in 2014.
Mr McFadden
The Minister’s phrase, “synthetic LIBOR”, helps us to understand this. I think it might mean something like this: that the regulator has the power to designate a benchmark as critical when it is unrepresentative of market reality, but in a way LIBOR is not really ending at the end of 2021, because we have synthetic LIBOR—the ghost of LIBOR, we might say—and the ghost of LIBOR is necessary because of those legacy contracts.
Where I still get confused is that the reason LIBOR is being wound up, and the reason that the FCA can designate it in this manner, is that it is unrepresentative—yet for the ghost of LIBOR, or synthetic LIBOR, to have any validity, the FCA has to continue to compel submitters to submit information to it. I do not know what the implications of that are for the quality of the ghost of LIBOR; we must remember that the reason it has been designated in the first place is that it is failing the market representativeness test. How is it, therefore, that for up to 10 years we can compel submitters to submit information to something that the regulator has judged invalid?
John Glen
The right hon. Gentleman has accurately summarised the issue around synthetic LIBOR, but we are getting into suppositions about the time period for which that synthetic LIBOR would be necessary. The FCA recently published a paper on this. It is about evolving circumstances in the market. It is very difficult to be prescriptive, hence the 10-year provision. We are now getting into the realm of market operating realities at some point in the future. We have to have something that references the fact that we have a considerable volume of contracts that reference the historical LIBOR and we have to have a reference point going forward. I hope that is helpful.
Question put and agreed to.
Clause 9 accordingly ordered to stand part of the Bill.
Clause 10
Prohibition on new use where administrator to cease providing critical benchmark
Question proposed, That the clause stand part of the Bill.
John Glen
Clause 10 inserts article 21A to the benchmarks regulation. This article provides the FCA with the power to issue a notice prohibiting some or all new use of a critical benchmark by supervised entities. The FCA may use this power where the administrator has stated that it wishes to cease providing the benchmark and the FCA has assessed the administrator’s plans to cease the benchmark or otherwise transfer it to a new administrator.
The FCA can exercise this power only if it considers that it is desirable to advance its consumer protection objective or its integrity objective under the Financial Services and Markets Act 2000. The notice will contain the reasons for the prohibition, the date when it is to take effect and any further information that the FCA considers appropriate to allow supervised entities to understand the decision. The FCA’s ability to prohibit new use in circumstances where the administrator is seeking to cease to provide the critical benchmark is an important step in preventing the pool of contracts referencing a benchmark from growing ahead of its possible cessation. I therefore recommend that the clause stand part of the Bill.
Mr McFadden
I thank the Minister for his explanation. This clause is about the prohibition of the use of benchmarks. Again, I have a few questions. Is it the case that prohibition can take place only after the kind of assessment of the representative nature of the benchmark that we discussed under clause 9(3), or are there other grounds for issuing a notice prohibiting the use of a benchmark, such as suspected criminal activity or manipulation in some other way?
My second question is about use. New article 21A prohibits “new use” of a benchmark. I think the Minister is saying that there should not be new use of a benchmark, but there may be continued use for the reasons that we have discussed—for legacy reasons. Could the Minister confirm that existing contracts referenced in the benchmark would not be covered by this “new use” provision?
My third question is about paragraph 4 of new article 21A, which says that the FCA must have regard to effects outside the UK of any decision to cease use of a benchmark. I can see why such a provision would be there, because LIBOR is used to underpin contracts all over the world. However, what can the regulator, which only has jurisdiction in the UK, do to stop the use of a benchmark elsewhere in the world? To what degree does this require work with other regulators through, for example, the Financial Stability Board, or is the judgment that action by the FCA alone would be enough, even though that action might have international effects, because of the importance of UK benchmarks? I suppose it is as if some jurisdiction has a particular influence in a sport, so when they change the rules, everybody else has to change the rules, too.
I assume that those criteria about the protection of the consumer and so on that the Minister referred to are in the Bill to protect the FCA from litigation risk by making clear that in acting on this, it was doing so in line with its statutory objectives, because the danger of litigation risk runs right through this.
John Glen
The right hon. Gentleman raises a number of questions, and I should start by making it clear that we in the UK cannot stop use overseas. The provision applies to UK-supervised entities working with international partners. He is right to say that there is interconnectedness between those institutions, and the FCA has a significant role in terms of LIBOR.
The simple purpose here is that, where a benchmark is to be ceased, the pool of contracts referencing that benchmark should stop growing. The prohibition power that the right hon. Gentleman referenced is available only at the point at which the benchmark administrator has informed the FCA that it is planning to cease to publish it and the FCA has considered whether it is realistic for the benchmark to be ceased or transferred to a new administrator. Clearly, it would not be desirable for the pool of contracts that reference the benchmark to continue to grow in circumstances where it is likely that that benchmark is on a pathway to ceasing to be used. It is therefore appropriate at that stage to stop supervised entities entering into new contracts that reference the relevant benchmark.
In terms of the rules broadly governing the FCA in exercising this power, it can do that only if it is desirable to do so in order to advance this FSMA consumer protection objective or the integrity objective, so it would have to be confident that it would secure an appropriate degree of protection for consumers or advance the integrity of the market, and it would have to publish a statement along those lines. I recognise that this is complex, but we are really trying to give an appropriate toolkit to the FCA to do what is necessary not only to safeguard the appropriate ongoing construction of benchmarks, but to ensure that it has the authority to justify the management of the wind-down in circumstances where that is necessary.
Question put and agreed to.
Clause 10 accordingly ordered to stand part of the Bill.
Clause 11
Assessment of representativeness of critical benchmarks
Question proposed, That the clause stand part of the Bill.
John Glen
Clause 11 introduces two new articles to the benchmarks regulation. New article 22A requires the administrator of a critical benchmark to undertake,
“an assessment of the capability of the benchmark to measure the underlying market or economic reality”.
The administrator must undertake such an assessment when a contributor to the benchmark is proposing to withdraw, when the FCA requires the administrator to undertake a review of the benchmark, or every two years as part of a biannual review process. New article 22A also requires that:
“If a supervised contributor…intends to cease contributing input data to a critical benchmark”,
it must provide written notification to the administrator at least 15 weeks ahead of the date it intends to cease contributing. That replaces the existing four-week notice period, which is insufficient.
New article 22B requires that the FCA must conduct its own representativeness assessment of the benchmark once it receives an assessment from a benchmark administrator under article 22A. The FCA may also proceed with its assessment where the administrator has failed to provide an assessment within the timelines specified by the legislation. After making its assessment under this article, the FCA must provide the benchmark administrator with a written notice setting out its findings, which could be that it considers that the benchmark is not representative of the economic reality it is intended to measure, that it is at risk of not being representative, or that the representativeness of the benchmark is not at risk.
Those assessments play a crucial role in the process we have designed for managing the wind-down of a critical benchmark. A finding that a benchmark is no longer representative or that its representativeness is at risk is the first step in activating many of the new powers that are being granted to the FCA. I recommend that the clause stand part of the Bill.
Question put and agreed to.
Clause 11 accordingly ordered to stand part of the Bill.
Clause 12
Mandatory contribution to critical benchmarks
John Glen
Clause 12 amends article 23 of the benchmarks regulation, which concerns the mandatory contribution to a critical benchmark by supervised entities. Article 23 already provides the FCA with certain compulsion powers over the administrator and supervised entities, which contribute to a benchmark, including the power to compel supervised contributors to continue to contribute to a benchmark. These powers were previously only available where the representativeness of the benchmark was judged to be at risk.
The clause amends the article to ensure that it works with the new representativeness assessments we are introducing under the Bill, and that these powers are available either where the benchmark is at risk, or where the benchmark has actually become unrepresentative. The changes mean that, for instance, the power to compel a contributor will now become available whenever the FCA has made a finding that the benchmark is unrepresentative, or its representativeness is at risk.
The clause also extends the compulsion powers to supervised third country contributors and requires that if a contributor gives notice that it intends to withdraw on a specific date, it may not cease contributing on that date without written permission from the FCA. It also clarifies that the FCA’s compulsion powers and other powers in paragraph 6 of article 23 are available specifically for the purpose of restoring, maintaining or improving the representativeness of a benchmark.
These powers are important in ensuring that a critical benchmark does not simply cease in circumstances where the representativeness of the benchmark could reasonably be maintained or restored through appropriate FCA action. I recommend that the clause stand part of the Bill.
Mr McFadden
I have one or two questions to the Minister. The clause gives the FCA the power to mandate contributors, including those outside the UK—it will be interesting to see how that works—to continue to submit information to a benchmark for up to five years. However, clause 9 states that synthetic LIBOR—the ghost of LIBOR—can be kept going for up to 10 years. Why is it five years in this clause but 10 years in clause 9?
John Glen
I thank the right hon. Gentleman for his question. He draws attention to the discrepancy between the provision for five years in clause 12 and 10 years elsewhere. It is important to remember that the powers in the Bill are not just for LIBOR but will be relevant to benchmarks that are designated as critical in the future. The changes in the clause ensure that the existing compulsion powers work with the amendments made to the wider regulation. Where we have a benchmark that is unrepresentative or is at risk of being unrepresentative, the FCA should have access to these powers.
With respect to LIBOR, the amendments ensure the FCA will have the required time to implement the various processes that we are introducing, to access their new powers, and to mitigate the risk of the rate simply ceasing due to insufficient input data. The 10-year provision is a contingency about the ongoing use of the benchmark. The timeframes are constructed with respect to both the LIBOR provision and the wider needs of benchmarks and have been constructed in consultation with the FCA over quite a long period.
Mr McFadden
I am not sure that that is entirely convincing, because neither clause refers specifically to LIBOR, for reasons that the Minister has explained. They both refer to benchmarks in general.
The different timescales used throughout this section are somewhat confusing. There are reviews every two years; other timescales of three months are mentioned here and there. I am genuinely confused about why clause 9 gives the power to compel contributions for up to 10 years, yet here we are a few clauses on talking about five years. I accept that the Minister says that the 10 years might be a maximum, but if these powers are to deal with the issue of legacy contracts, I am still not sure why we have this discrepancy. It could be that I am not understanding something or that I am missing something. That is certainly possible. Is this an arena where the Government may come forward with an amendment during the later stages of the Bill’s passage?
John Glen
I am always open to looking at the possibility of amendments, as I have demonstrated during the sittings we have had so far. The 10-year reference was under the revised methodology for LIBOR to be produced by the administrator. It will probably be useful for me to reflect on this exchange, and to write to the right hon. Gentleman and the Committee to clarify the apparent discrepancies and rationale for this. I recognise that this is genuinely complicated. I want to bring satisfaction to the Committee and I am happy to do that.
Julie Marson (Hertford and Stortford) (Con)
It is a pleasure to serve under your chairmanship, Mr Davies. The shadow Minister is obviously concerned and quite rightly scrutinising the detail of every clause. Does my hon. Friend agree that it would be apposite to recall from the evidence from the regulators, including the Prudential Regulation Authority, the FCA, and specifically the LIBOR transition director for UK finance, how supportive they are of the provisions of this Bill? The LIBOR transition director said explicitly in his evidence:
“These powers, in preventing all those negative outcomes for both customers and market integrity, are absolutely critical as part of the transition.”––[Official Report, Financial Services Public Bill Committee, 17 November 2020; c. 18, Q30.]
That plays back into the consultation and regulators’ support for the Bill.
John Glen
I appreciate my hon. Friend’s intervention. It demonstrates that there is widespread concern for this legislation to be passed. The right hon. Gentleman is pressing me, quite appropriately, on these apparent anomalies, and I am happy to submit to his questions. The issue is that synthetic LIBOR is related to the 10-year provision, but the five-year provision is for other critical benchmarks, which do not have the same context in terms of their contractual longevity. As I said in my response to the right hon. Gentleman, I will write to him and to the Committee to bring clarity on this matter. It is an important matter that needs clarifying.
Question put and agreed to.
Clause 12 accordingly order to stand part of the Bill.
Clause 13
Designation of certain critical benchmarks
Question proposed, That the clause stand part of the Bill.
John Glen
The clause inserts a new article into the benchmarks regulation that, in essence, provides the FCA with the power to designate a critical benchmark as an article 23A benchmark, if they consider that the representativeness of the benchmark cannot reasonably be restored, or there are not good reasons to restore and maintain its representativeness. This designation allows the FCA to use a number of the new powers that are set out later in the Bill, such as the ability to require that the administrator change the benchmarks methodology.
Given the significant impacts of making such a designation, we have included a number of safeguards to the designation power. First, if the FCA considers it appropriate to designate a benchmark, they must inform the administrator and allow 14 days for the administrator to make representations before proceeding with the designation. If the FCA decides to proceed with the designation, they must publish a notice. That should include, among other things, the reasons for their decision, the date it takes effect and any further information that the FCA considers appropriate to assist supervised entities in understanding the effects of the designation.
In summary, clause 13 sets out the procedure by which the FCA can designate a benchmark and access the powers detailed later in the Bill. I therefore recommend that the clause stand part of the Bill.
Mr McFadden
I am grateful to the Minister. Before I begin, I say to the hon. Member for Hertford and Stortford that we are under a duty here to try to understand what we are doing. It is in that spirit that I am asking these questions. I was reminded by a colleague about a different kind of Standing Committee, which some years ago was considering the Hunting Bill. He told me that after a month they were still on clause 1, which was about the title of the Bill, so I do not think we have gone over the top in asking these questions.
With your and the Minister’s indulgence, Mr Davies, I would like to make a few points about the next few clauses; I think they go together and get to the heart of what this area of the Bill is about. As I said, the Opposition understand why LIBOR is being wound down; we have gone over the history of the manipulation and so on. It is why the Bill rightly places such an emphasis on benchmarks being representative of market activity: so far, so uncontroversial.
However, there is a problem in the transition from LIBOR to SONIA or other new benchmarks. As we have referenced several times, there will clearly be some impact on the value of LIBOR-based contracts. That impact is openly acknowledged by the FCA when it says:
“Where parties to contracts referencing LIBOR cannot reach agreement on how those contracts would operate in the event of LIBOR’s cessation, discontinuation could cause uncertainty, litigation or loss of value because contracts no longer function as intended. If this problem affects large volumes of contracts it could pose risks to wider market integrity of contracts/financial instruments.”
Remember that, given the volume of money involved—we are talking about not millions or billions but trillions—this is a systemic risk, as well as a risk to individual parties to contract.
My understanding of the provisions in clause 13 and a few that follow is this. When the FCA feels that a benchmark is no longer representative of the market to which it relates or that that representativeness is at risk, it can designate the benchmark under article 23A of the benchmark regulation. Then there are various provisions about notices being published, reasonable fees being charged and so on; we can leave those aside. When such a benchmark is designated by the FCA, that can only be done in line with the statutory duties, to which the Minister referred, of consumer protection and market integrity. When a benchmark is designated in that way, new use of the benchmark is prohibited, but—this is the critical “but”—the FCA can mandate continued legacy use of that benchmark. The Minister may come back to me about timescales—five years, 10 years or whatever it is.
Finally, if the potential disruption brought about by the discontinuation of LIBOR—or a critical benchmark, if we want to refer to it in that way—is too great, it is suggested in the Bill that the FCA may compel its continuation, as we have discussed. How realistic is it for the FCA to continue to compel administrators to submit information to something that they have said they want to phase out in a year’s time? The provisions are intended to allow the FCA to wind down a critical benchmark but in a way that protects these legacy contracts, which are based on the old benchmark. That brings us to those legacy contracts and what is or is not included, and to the potential legal risks.
As I understand it, there might be two issues. First, what is the definition of a legacy contract? Is it one where there has not been agreement between the two parties to transfer to the new benchmark, or is it something different? What are we talking about when we discuss legacy contracts? What would we do if there were a dispute between the parties about whether something should be treated as a legacy contract or not?
Secondly, how will the provisions cope with the potential legal action and/or market disruption as a result of parties feeling aggrieved, for one reason or another, about the switch from one benchmark to another or, in consequence, taking action that results in disorderly markets? In other words, to what degree is the process subject to disruption through legal action by the parties involved, which could feed into market operation, given the volume of money involved in these contracts?
Mr McFadden
However, I thought it better to take these next few clauses together and raise those points with him in this way.
Alison Thewliss
I want to ask a quick question about what is perhaps neither synthetic nor ghostly LIBOR, but zombie LIBOR, because it seems to be lurching on and not quite dead.
I am curious about the monitoring of whether these critical benchmarks are becoming unrepresentative, how that practically would work and at which stage that happens. I also note that there is an obligation under clauses 13 to 16 to bring things to the attention of the public and the supervised entities, but no such requirement to bring them to the attention of Parliament. Will the Minister reflect on whether it would be useful to us as parliamentarians to hear about those things? We cannot necessarily be expected to monitor things on the FCA website as members of the public, and those things might be something that parliamentarians might usefully want to find out.
John Glen
I thank the hon. Lady and the right hon. Member for Wolverhampton South East for their questions, and I will do my best to address them.
On legacy use, this is broadly where a benchmark was used in specified existing contracts or instruments prior to its designation as an article 23A benchmark. The right hon. Gentleman went on to ask a series of questions about the concept of safe harbours, the different jurisdictions of legal process, and the compulsion process. The Government believe that the proposal is realistic. The administrators do not submit information; the contributors do. On safe harbours, which we picked up on from the evidence from the gentleman from the trade association last week, we recognise the challenges identified in that session, and the powers are designed to assist those contracts that cannot feasibly move away from LIBOR, as Paul Richards described. I am committed to looking to address the issue of safe harbour through further work with industry.
In practice, it will not be possible to table amendments during the passage of this Bill, but that is not down to my unwillingness to do so; it is a matter of the maturity of the conversation, and I think that will be acknowledged. A live productive conversation is going on.
Mr McFadden
Is the parallel legislation in the United States and the EU part of that consideration? When we received the oral evidence last week, I confess that I had not appreciated that parallel legislation on this subject, with safe harbour provisions, was going through in those two jurisdictions. Given the co-operation that already exists through the FSB, involving in the Federal Reserve Bank of New York and the Bank of England, is that part of the consideration?
John Glen
We are looking and working internationally. We have an active dialogue with the US through a regulatory working group, and we will be monitoring that. There is no question of us seeking to find some competitive advantage in this; there will be a need to find as much alignment as possible to give as much clarity and certainty to the market actors. However, the conversation is not at that stage yet here. There is no sense that that is jeopardising the integrity of this process. This is the first step, but we reserve the right to do other things further to the conclusion of those conversations.
As for accountability to Parliament, as raised by the hon. Member for Glasgow Central, the legislation requires the FCA to produce statements of policy and notices when exercising the powers. There is also a requirement to review the exercise of its methodology every two years and to publish a report following that review. The FCA is required to exercise its powers in accordance with the two statutory objectives: consumer protection and market integrity. That is the relationship to parliamentary accountability.
Turning to the other matters raised by the right hon. Gentleman around the administrator challenging a designation, if the FCA decides to designate a benchmark under this article, the benchmark administrator has the option of referring the matter to the upper tribunal. The FCA is required to inform the administrator of its right to refer the decision to the upper tribunal and the procedure for doing so.
As for the continued publication of a benchmark that has been deemed unrepresentative, in the case of a critical benchmark such as LIBOR, the benchmark is so widely used that its discontinuation would represent a risk to financial stability and create disruption for market participants. Therefore, this Bill provides the FCA with the power to require a change to how a critical benchmark is determined, including input data, to preserve the existence of the benchmark for a limited time period to help those contracts that otherwise would not realistically transfer to an alternative benchmark.
I hope I have done justice to most of what the right hon. Gentleman raised. I will seek to review what we have exchanged and, if there are outstanding matters, to write to him. I am relieved we have moved beyond clause 1.
Question put and agreed to.
Clause 13 accordingly ordered to stand part of the Bill.
Ordered, That the debate be now adjourned.—(David Rutley.)
Financial Services Bill (Eighth sitting)
Thursday 26th November 2020
(4 years, 1 month ago)
Public Bill CommitteesRead Full debate Financial Services Bill 2019-21 View all Financial Services Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 26 November 2020 - (26 Nov 2020)
The Chair
The same drill as the other day: I am happy to permit Members to remove their jackets. Apparently permission has to be sought from the Chair to remove a jacket, so there you go—that is how nice I am. I saw you a lot on TV yesterday, Minister; it is nice to see you in the flesh.
Clauses 14 and 15 ordered to stand part of the Bill.
Clause 16
Review of exercise of powers under Article 23D
The Economic Secretary to the Treasury (John Glen)
I beg to move amendment 3, in clause 16, page 23, line 13, leave out “latest” and insert “most recent previous”.
This amendment clarifies what the FCA has to review before re-exercising the power under Article 23D(2) of the Benchmarks Regulation.
Clause 16 introduces a new provision: article 23E of the benchmarks regulation. It requires the Financial Conduct Authority to conduct and publish a review of an exercise of its article 23D powers to direct the administrator of an article 23A benchmark to change the methodology rules, or code of conduct, of the benchmark. Where the FCA has exercised a power under article 23D, the FCA is required to conduct and publish a review of the exercise of that power two years after the power is first exercised. The FCA must then conduct and publish such a review in each subsequent two-year period until the benchmark ceases to be published.
The FCA will also be required to review the exercise of this power under article 23D whenever it intends to re-exercise its power in relation to the same benchmark. The FCA must conduct and publish a review of the latest exercise of its article 23D power before re-exercising the power where that is reasonably practicable. In circumstances where it may not be reasonably possible for the FCA to conduct its review prior to the use of the power, the FCA must conduct and publish its review as soon as is reasonably practicable after the re-exercise of its article 23 power. For instance, it is possible that the FCA may need to take such a course of action when it needs to access its article 23D powers urgently to prevent significant market disruption or financial stability risks.
In concluding the review, the FCA will be required to consider whether the exercise of its power has advanced, or is likely to advance, its statutory objectives to protect consumers and market integrity. It must also have regard to the statement of policy that the FCA has published in respect of the use of its article 23D powers. The clause provides a statutory mechanism through which the effectiveness of the FCA’s exercise of its powers under article 23D can be evaluated. It also serves to increase the accountability of the FCA in the exercise and re-exercise of the powers.
I apologise for not acknowledging you in the Chair, Dr Huq; it is a pleasure to serve under your chairmanship. I recommend that the clause stand part of the Bill.
Mr Pat McFadden (Wolverhampton South East) (Lab)
I thank you, Dr Huq, for chairing this afternoon’s session. For clarity, we had a fairly extensive debate on clauses 13 to 16 together, hence the speed of our progress at the beginning of this session.
John Glen
Amendment 3, which stands in my name, is a technical amendment. As the explanatory note says, it is intended to clarify the scope of the review that the FCA is required to undertake where it re-exercises its article 23D(2) powers in relation to the same benchmark. Article 23D(2) provides the FCA with the powers to direct the administrator of a critical benchmark to change the methodology rules or code of conduct of the benchmark. The amendment serves to put beyond doubt which exercise of power the FCA is required to review at this point in time.
I would like to address the point raised by the right hon. Member for Wolverhampton South East just before we broke for lunch on the international LIBOR transition. The Government have followed related global regulatory developments closely, including what is going on the United States, as he mentioned, with the US Alternative Reference Rates Committee’s legislative proposal. We continue to work with regulators to engage our international counterparts directly, as well as through the Financial Stability Board’s official sector steering group and the International Organisation of Securities Commissions.
It is quite clear that, as the right hon. Gentleman stated, we will need a co-ordinated global approach, and we aim to provide consistent outcomes for users. The Government are committed to ensuring that their dialogue with international counterparts continues, and aim to firmly limit any unhelpful divergence to outcomes. I hope it will be helpful for the Committee to have that put on the record.
Mr McFadden
I am grateful to the Minister; I suspect that is a harbinger of a Government amendment at some point, because of the debate we had on safe harbour provisions. If they are coming in in the US and the EU, I suspect, given what he has just said about marching together on this internationally, we may see an amendment from him on this at some point.
The Chair
It sounds like fine-tooth comb stuff this morning.
Amendment 3 agreed to.
Clause 16, as amended, accordingly ordered to stand part of the Bill.
Clause 17
Policy statements relating to critical benchmarks
Question proposed, That the clause stand part of the Bill.
John Glen
Clause 17 introduces a new provision, article 23F of the benchmarks regulation. This clause requires the FCA to publish statements of policy and to have regard to those statements when exercising certain new powers set out in the benchmarks regulation. The FCA is required to publish a statement of policy with respect to the exercise of this power to designate a critical benchmark as an article 23A benchmark. This is the designation the FCA can make where it determines that a benchmark’s representativeness cannot be restored or maintained, or that there are good reasons not to restore or maintain representativeness.
The FCA must also publish a statement of policy with respect to the exercise of its powers under article 21A, which allow it to prohibit new use of a critical benchmark when the administrator of that benchmark has notified the FCA of its intention to cease providing the benchmark. The FCA is also required to publish a statement of policy in exercising its powers under article 23C, which allow it to permit certain types of legacy use of an article 23A benchmark by supervised entities. Finally, the FCA must also publish a statement of policy in exercising its power under article 23D, which allows the FCA to impose requirements on the administrator of an article 23A benchmark to change the methodology, rules or code of conduct of the benchmark.
The Bill states that the FCA’s duty to prepare and publish those statements of policy can be satisfied before as well as after this legislation comes into force. On 18 November, the FCA published two consultations inviting industry feedback on statements, which ask for views on how the FCA intends to exercise its article 23A and article 23D powers granted under this Bill. It has also stated its intention to engage with industry stakeholders and international counterparts in the development of its statements of policy with respect to its powers under articles 21A and 23C.
This clause increases transparency regarding how the FCA will exercise certain new powers set out in the Bill to support the orderly wind-down of a critical benchmark. In developing statements of policy, the FCA will be able to engage with industry and international counterparts. The clause also requires the FCA to have regard to those statements when exercising its new powers, reducing uncertainty for market participants. Therefore, I recommend that the clause stand part of the Bill.
Mr McFadden
I just have a question about these policy statements. We have been through quite a lot about how the FCA will designate, compel and continue the submission of information and all the rest of it. What role do these policy statements play in all of that? Is the policy statement simply putting into law a requirement on the FCA to say why it has acted as it has, or is it, as part of what I think is behind some of the stuff in these clauses, insulating the FCA against the threat of legal action because of the possible effect on contracts? Is this a nice to have, best practice or is it something that helps to protect the FCA against the threat of litigation, which has been a thread through this discussion?
Ms Angela Eagle (Wallasey) (Lab)
Obviously, this is a very technical area, to say the least. I just want to ask a couple of questions so that I can get my head round how the FCA will use the power. We have different regulators who could make different determinations as to what constitutes benchmarks going forward, and yet those benchmarks write contracts worth trillions of pounds and dollars into the future. Any arbitrage opportunity in the way that those contracts work could make some people very rich and ruin others. This will be decided as one goes along. Some of these contracts are being made, but some are already projected into the future.
To ensure that markets are not distorted and the potential for nefarious profit by some with insider information is minimised, we need reassurance about how the FCA will perform the task, particularly in its interactions with the other regulators. I am not sure what the Government’s intention is, apart from saying they are going to liaise with other regulators. Is it the Government’s intention that these benchmarks ought to be similarly designed and defined across different regulatory jurisdictions, since this is almost a currency, or are we seeking divergence here as well in order to perhaps increase our chances of being the place where some of this business is written?
Perhaps the Economic Secretary could reassure me on that, because the FCA’s powers are pretty strong, but what is the intention? That might be in all of the many consultations, which I confess I have not read, so it might be set out there. If the Minister could put a little more on the record, we might at least have some certainty there, not least for Pepper v. Hart purposes.
John Glen
I thank the right hon. Member for Wolverhampton South East and the hon. Member for Wallasey for their observations. The hon. Lady demonstrates her experience and professionalism in being able to jump in on the first clause, having not been here this morning—no disrespect intended.
John Glen
The point that the hon. Lady makes is absolutely clear. We need to ensure that the regulations are in line with global practices because the issue is global. The interconnectedness of financial services markets demands, as in the statement I made just now, that we work very closely with regulators in other jurisdictions. It is absolutely right that we learn the lessons that the right hon. Gentleman, in his work on the Parliamentary Commission on Banking Standards several years ago, drew attention to with respect to the appalling abuses in the market. This measure is designed to give us a framework and to give the FCA the powers to ensure that we have global best practice and no ambiguity.
John Glen
This clause introduces a new provision, article 23G, into the benchmarks regulation. The clause makes provision about critical benchmarks provided for different currencies, or for different maturities or periods of time. This type of benchmark is known as an umbrella benchmark. LIBOR, for instance, is an umbrella benchmark. It is published in five different currencies over seven different time periods, ranging from overnight to up to one year. Those five currencies and seven time periods are paired to form 35 individual LIBOR settings, referred to in the legislation as “versions” of the benchmark. An example of a version of LIBOR would be three-month US dollar LIBOR.
Paragraph 3 of article 23G sets out that specified articles of the benchmarks regulation will apply to umbrella benchmarks as if each version were a separate critical benchmark. Paragraph 4 sets out how provisions under paragraph 3 of article 21, paragraphs 1(a) and 2 of article 22A and paragraph 1 of article 23E of the benchmarks regulation are modified in relation to an umbrella benchmark.
The Treasury will be able to make, by regulations, provisions about the operation of the UK BMR in respect of umbrella benchmarks. The regulations must be made by way of the affirmative procedure.
This clause sets out that the FCA will be able to exercise certain new powers to support the orderly wind-down of a critical benchmark in different ways in relation to different versions of an umbrella benchmark. It also clarifies the existing operation of certain provisions of the benchmarks regulation and how the FCA’s powers apply to versions of a benchmark. Those clarifications of the FCA’s powers will be of aid in supporting the orderly wind-down of a critical benchmark. For example, where panel banks begin to withdraw their submissions to some or all versions of LIBOR after the end of 2021, the different versions of LIBOR are likely to become unrepresentative, as we discussed earlier, or be at risk of becoming unrepresentative at different speeds.
It would be neither practicable nor appropriate for the FCA to exercise its new and existing powers uniformly across all versions of LIBOR simultaneously. For example, it is possible that if the robust input data necessary for an alternative methodology is not clearly available for certain versions of LIBOR, the FCA may not be able to exercise its power to direct a change in its methodology. In other cases, market participants may prefer to cease publication of some LIBOR versions. The FCA will consider evidence and views from market participants and global authorities in deciding the best course of action in respect of LIBOR versions.
It is critical to the wind-down of LIBOR, and future umbrella benchmarks, that the FCA can apply its powers under this legal framework to different versions of an umbrella benchmark at different times and in different ways. I therefore recommend that this clause stand part of the Bill.
Question put and agreed to.
Clause 18 accordingly ordered to stand part of the Bill.
Clause 19
Changes to and cessation of a benchmark
Question proposed, That the clause stand part of the Bill.
John Glen
The clause introduces amendments to article 28 of the benchmarks regulation, including new paragraphs 1A to 1E. Article 28 of the benchmarks regulation stipulates requirements for benchmark administrators and supervised entities in preparing for changes to, or the cessation of, benchmarks. I will refer to this as the change and cessation procedure.
The clause inserts the word “robust” in paragraph 1 of article 28 to define and strengthen the nature of the change and cessation procedures that benchmark administrators are required to publish. The clause also inserts new paragraphs 1A to 1E, which set out requirements for the written change and cessation procedure that a benchmark administrator must publish.
New paragraph 1A establishes that the administrator must publish a robust written change and cessation procedure alongside the publication of the administrator’s benchmark statement, which, among other things, sets out the market or economic reality that the benchmark intends to measure. The documents must be published within two weeks of the benchmark being registered in the FCA’s register. Wherever a material change occurs, the benchmark administrator is required to update its written procedure. For critical benchmarks, the proposed changes in new paragraphs 1B to 1E set out additional and more stringent requirements.
When publishing its written procedure, the administrator of a critical benchmark is required to provide an assessment to the FCA, on the basis of the information available to it, that considers the nature and extent of the current use of the benchmark, the availability of suitable alternatives, and how prepared users are for changes to, or the cessation of, the benchmark. Before publishing an updated written change and cessation procedure, critical benchmark administrators must also provide that assessment together with their updated written procedure to the FCA for review. The FCA is required to review and consider whether the procedure is sufficiently robust. The administrator must not publish an update of its procedure without receiving written notice from the FCA that its procedure is sufficiently robust.
In order to be designated as a critical benchmark, a benchmark must be used extensively, and its cessation may pose significant and adverse impacts on market integrity, financial stability, consumers, the real economy, or the financing of households and businesses. It is therefore reasonable and proportionate to require administrators of critical benchmarks to demonstrate via an assessment that their cessation plans are robust. We do not expect it to be an overly burdensome assessment for benchmark administrators. The clause will support increased preparedness in the event of changes to, or the cessation of, benchmarks in the future. I therefore recommend that the clause stand part of the Bill.
Ms Eagle
Again, I have just a few questions so that I can get in my head precisely what the reason is for putting this in primary legislation. LIBOR clearly had its issues but it was used for a very long time. Is the Minister anticipating that benchmarks will change much more rapidly in the future, or does he want some kind of stability with the new benchmarks that are based on actual prices, rather than the guesses of participants in the market, as LIBOR came to be defined prior to its demise?
Is the Minister expecting that this kind of provision for ceasing benchmarks will be used regularly? I anticipate that the answer will be, “Only when it is needed because of what is happening in the market.” If this kind of procedure is theoretical and on the face of a piece of legislation but hardly ever used, does that mean that the mechanisms that the Minister is setting out in clause 19 and other parts of the Bill will rust away? They will be there in theory, but there will be nobody there to work them properly. How does he anticipate that the market, the FCA and the benchmark administrators will maintain the capacity to do this if cessation is a very irregular, rare thing?
Will the Minister spend a bit of time defining what “robust” means in this context? In my time in this place, I have had many arguments with Ministers, and made many arguments as a Minister, about why we must not put particular words on the face of Bills and what their meaning is. Can the Minister enlighten us as to what he, the FCA and the Treasury mean by “robust” and how they are defining that in law, so that I can have a bit more confidence that they have got it right on the face of the Bill?
John Glen
I thank the hon. Lady for her comments. Although the provisions of this legislation are under the heading of benchmarks, they really refer to the capacity that we need to have to deal with the LIBOR issue. She is right to raise the question of the enduring provision and how tested and exercised that capacity would be, but this is about setting a framework for future use, which is very difficult to anticipate. We want to ensure that it is fit for purpose for the future.
The hon. Lady asks when the framework could be used, which is not a matter that I can reasonably be drawn on, because it would be about market conditions evolving, but it certainly means that we are ready for whatever might evolve, in terms of benchmarks on the path towards becoming critical. However, it will be for the FCA, in conversation with the market and Parliament, to determine how to bring that forward.
Ms Eagle
Does the Economic Secretary think that, given the incredible trouble that the wind-down of LIBOR has caused in the markets—not least because of what is on the face of the Bill and the very difficult issues caused by having to exit the LIBOR benchmark—it is best to try to get the next benchmark sorted and future-proofed, so that it does not turn into LIBOR 2 and cause his future successor in the Treasury and me all this kerfuffle in a Public Bill Committee?
John Glen
Absolutely. It is absolutely right that we give the power to the FCA but also keep a vigilant eye on evolving market conditions, so that we are well placed to move earlier to deal with any failures in benchmarks.
The hon. Lady asked me to define “robust” in the context of the Bill. I am reluctant to be drawn on that, because it is a matter of legal definition, but I would be very happy to write to her on that and respond at subsequent sittings of the Committee, if she wishes me to do so.
Question put and agreed to.
Clause 19 accordingly ordered to stand part of the Bill.
Clause 20
Extension of transitional period for benchmarks with non-UK administrators
Question proposed, That the clause stand part of the Bill.
John Glen
The clause amends article 51(5) of the benchmarks regulation, which provides for a transitional period during which the UK’s supervised entities can continue to use all third-party benchmarks. Those are benchmarks that are provided by administrators located outside the UK. When the UK onshored the EU benchmarks regulation, the transitional period for third-country benchmarks was extended from the end of 2019 to the end of 2022. The extension was made to provide third-party benchmark administrators with more time to apply for continued access to UK markets. For the UK’s supervised entities to continue to use benchmarks that are administered outside the UK after the end of 2022, the benchmarks or their administrator must be listed on the FCA benchmarks register.
The benchmarks regulation provides three access routes for third-country administrators or benchmarks. They must apply for the endorsement of specific benchmarks or for recognition as an administrator, or they can benefit from an equivalence decision made by the Treasury with respect to their home jurisdiction’s regulatory framework. As of October 2020, however, only 14 third-country benchmark administrators have come through the access routes that are outlined in the EU benchmarks regulation. Industry engagement has also revealed important concerns about the operation of the current regulatory regime for third-country benchmarks under the benchmarks regulation. For example, many non-European economic area jurisdictions do not have specific regulator rules for benchmarks.
The UK will explore how best to support the use of global, non-UK benchmarks that adhere to equivalent regulatory outcomes. The endorsement and recognition access routes both rely on third-country administrators being willing to apply for market access, and require the appointment of a UK entity to facilitate their application for ongoing market access. Some third-country benchmarks are provided on a non-commercial basis, however, meaning that those administrators lack an economic incentive to apply. Smaller firms may also be reluctant to appoint a third-party UK entity to oversee their benchmark administration.
Mr McFadden
I just want to ask the Economic Secretary a question to ensure that we have properly understood the clause. All through this part of the Bill, we have talked about the different timescales in different clauses, and here we have another, which extends the transition period for benchmarks with third-country administrators until the end of 2025.
For my clarity, and perhaps for that of colleagues, will the Economic Secretary clarify whether the measures are different—I think they are—from the five and 10-year timescales in clauses 9 and 12, relating to the FCA designating what the hon. Member for Glasgow Central called zombie LIBOR? Is this five-year period about something different or does it relate to that?
Having debated this matter for a couple of hours, I am not sure that we have resolved it. My feeling is that we are leaving quite a lot to the FCA. I hope that the clause minimises the risk of harm. We have talked a lot about the risk of litigation, but there is also the risk of harm to those who have entered contracts based on LIBOR in good faith. The Government and regulators are trying to move away from that system for reasons that we understand are to minimise harm to those who signed up in good faith, but I suspect that there is still a fair bit of work for the regulator to do to ensure that that is the case.
Ms Eagle
Will the Economic Secretary share with the Committee the intention behind the extension to 2025? He said that it was to create certainty—I can understand that. Is the intention to transition to something different—the new third-country regime—after the extension, or is it to develop and introduce it earlier if it looks like there are advantages to doing so? I know that I am asking him to gaze into the future, but this will be in the Treasury and regulators’ work list and they will presumably schedule it at some stage. Does he expect the creation of a third-country regime to be difficult or quite easy? Are the Government thinking of basing it on the existing regimes or diverging from what we are used to? Will he give us a little more information about how the Treasury intends to proceed with this piece of technical but very important work.
John Glen
I am very happy to address those points. The right hon. Member for Wolverhampton South East raised the issue of the different time periods. This is different from the LIBOR transition; it is about the third-party benchmarks exclusively. It is a response to the market reality, as we have seen in the number of applications. I will come to the point of the hon. Member for Wallasey in a second.
The right hon. Gentleman also asked about the risk of harm concept and how important that is. Clearly, the LIBOR transition, as we have established today, is an incredibly complicated matter with a great deal of legal complexity, an imperative to align to global best practice, the need to produce a synthetic alternative and the evolution of policy around that. It is also designed to protect. He is right to say that there is a lot more work to be done; there is no off-the-shelf solution. This measure allows the formal framework for that to evolve.
The hon. Member for Wallasey asked me to comment on the future time period by which the new third-country benchmark regime would be constructed. The extension is a response intended to resolve industry concerns and to ensure that UK markets can retain access to the third-country benchmarks. There is no intention to find some way of deviating from norms on that. It is in our interest to have complete alignment to global best practice. The extension gives UK firms the legal and economic certainty. As soon as it can be done, it should be done. I cannot give her the precise location of where that is in the work plan—the FCA has a lot on at the moment—but she is right that we need to operationalise it appropriately, recognising the different obligations on different sized firms. I will be working with the FCA to keep an eye on that in the coming weeks and months.
Question put and agreed to.
Clause 20 accordingly ordered to stand part of the Bill.
Clause 21
Benchmarks: minor and consequential amendments
Question proposed, That the clause stand part of the Bill.
John Glen
This clause inserts schedule 5, which sets out minor and consequential amendments to the benchmarks regulation to provide for the effective operation of that regulation in the context of the amendments introduced by clauses 8 to 19. I therefore recommend that the clause stand part of the Bill.
Question put and agreed to.
Clause 21 accordingly ordered to stand part of the Bill.
Schedule 5 agreed to.
Clause 22
Regulated activities and Gibraltar
Question proposed, That the clause stand part of the Bill.
The Chair
It was projected that we would get up to clause 20 by the end of this morning, in fact.
John Glen
I allowed myself a moment of light-heartedness, but I can see that that was not appropriate.
In financial services, the Financial Services and Markets Act 2000 allows for several categories of authorised persons to carry on regulated activities in the UK, such as firms with domestic part 4A permission or, until the end of the transition period, EEA passporting firms. The clause provides a regime through which firms authorised for activities in Gibraltar can be recognised as authorised persons in the UK.
When significant areas of financial services regulation were set at EU level, that meant that the UK and Gibraltar followed the same rules. Now that the UK and Gibraltar have left the European Union together, the legal framework that provides for mutual market access and aligned standards needs amending. Without new permanent arrangements, Gibraltar will lose its current breadth and depth of access to the UK market, which not only would damage Gibraltar’s economy and our special and historic relationship but could lead to disruption and more limited choice for UK consumers.
The detailed application of the regime is set out in two schedules, which in turn insert two new schedules into the Financial Services and Markets Act 2000: schedule 2A, as inserted by schedule 6, governing the operation of the arrangements for Gibraltar-based firms; and schedule 2B, as inserted by schedule 7, which provides for the requirements that outgoing UK-based firms must meet before accessing the Gibraltarian market.
I should clarify that we are not legislating for Gibraltar. The measure is primarily about Gibraltar-based firms’ access to the UK. The Government have a responsibility to ensure financial stability and the correct operation of the UK financial services system, particularly when we open our markets to other jurisdictions. The clause therefore also requires the Treasury to lay a report before Parliament about the operation of the regime every two years.
The report will explain the Treasury’s assessment of whether the three conditions in the clause—that is, compatibility with the objectives in the clause, the alignment of law and practice, and co-operation—have been met during any reporting period, and whether the Treasury therefore proposes to enable market access for particular activities. That will give Parliament confidence that regulatory and supervisory standards are being applied in a consistent manner by UK and Gibraltarian institutions, so that UK consumers can benefit from products from a wide range of providers without additional risks.
Given that clause 22 is central to the creation of permanent market access arrangements between the UK and Gibraltar, I recommend that it stand part of the Bill.
Mr McFadden
Like the Minister, I too bid a fond farewell to LIBOR. Clauses 22 and 23 and schedules 6 and 7 establish the Gibraltar authorisation regime, which could be described as a sort of mini-single market in financial services between the UK and Gibraltar. The Government have set out many detailed pages in the schedules in particular about how that mini-single market should work.
Up until now, Gibraltar has been regarded as a European territory that was a member of the EU through its status as a British overseas territory. That meant that Gibraltar had full access to single market rights, including those in financial services. Given that Gibraltar, as well as the UK, has now left the EU and is coming towards the end of the transition period, the Government clearly felt that they had to put a regime in place to be the basis of future trade in financial services between Gibraltar and the UK.
Such a regime was, to some extent, necessary, because of the volume of trade in financial services that already exists between the UK and Gibraltar. We heard during last week’s oral evidence that roughly one in five car insurance policies in the UK is held by Gibraltar-based insurance companies. As I said during an oral evidence session last week, there is great good will towards Gibraltar on both sides of the House. The people of Gibraltar voted to remain in the EU by an overwhelming margin—I think it was about 95%—so we could describe the clauses and the accompanying schedules as the consolation prize to Gibraltar for having to depart the EU at the same time as the UK.
I know that under clause 22 the Treasury will report every two years on how the regime is operating. I cannot fail to reflect that that is precisely the kind of regular reporting mechanism that the Minister so stoutly rejected about four times on Tuesday when we were trying to insert it into the clauses on capital requirements. Why is it right and necessary for the Treasury to review this regime every two years but not to review the impact of change in the capital requirements on major parts of our financial system?
According to schedule 6, the report must have particular regard to paragraphs 7, 8 and 9 of that schedule, which set out the details of the new regime. Paragraph 7 tries to instil protections for the UK into this process, including for the soundness and stability of our own system, and, according to paragraph 7(c),
“to prevent the use of the UK financial system for a purpose connected with financial crime”.
It goes on to talk about ensuring markets work well, the protection of consumers and, interestingly, according to paragraph 7(h), about the need
“to maintain and improve relations between the United Kingdom and other countries and territories with…significant markets for financial services.”
Stella Creasy (Walthamstow) (Lab/Co-op)
My right hon. Friend is making a powerful and important case about the importance of ensuring that we do not inadvertently support money laundering or standards that could enable that by accident. It is worth reflecting that in February this year, the EU anti-money laundering watchdog, MONEYVAL, called for Gibraltar to do more. One question for us in this legislation is whether there are things we can do to ensure that we are not inadvertently creating access that would enable such behaviour, now that we are leaving the European Union, which might have been offering that level of scrutiny. Does my right hon. Friend have a view on joining up those dots?
Mr McFadden
My hon. Friend is absolutely right. In fairness, I do not think that the UK system on money laundering and financial crime is perfect—we have our own issues, which we have debated before and will debate later in our consideration of the Bill—but these findings should be taken seriously, particularly as we are creating a new situation. In the past, both the UK and Gibraltar were part of the EU and we operated under the single market rules, including those on financial services. I do not know whether what we are creating is unique—I will ask the Minister about uniqueness—but it is certainly a new concept: a mini-single market in financial services between two territories.
What is the Minister’s response to the report’s findings? In particular, given that protection from financial crime has been written into the Bill through the Government’s two-year review process, what contact has there been between the Treasury, the relevant regulators and the financial institutions in Gibraltar since the report was published a year ago? What actions do the authorities propose to take? I certainly believe that the Gibraltar authorities will want to act in good faith and try to uphold proper standards, but some of the report’s findings are concerning.
Another issue raised last week was the difference in corporation tax between Gibraltar and the UK: Gibraltar’s main corporation tax rate of 10% is significantly lower than our own. The Minister from Gibraltar said in his evidence, with some charm, that corporation tax would not be a factor in location—that, if anything, quality of life was more important. I have no doubt that the quality of life in Gibraltar is very good; looking out on a slightly gloomy London autumn afternoon, I have no doubt that the weather and climate is a big attraction, too. I am sure that he was right about that, but it is a big tax difference. He also pointed out—again, quite fairly—that the corporation tax differential predates our departure from the EU and has been in place for some time. However, this is a new situation, with a new, specially designed market access regime for Gibraltar being enshrined in UK law. Has the Treasury made any assessment of the likelihood of corporate relocations from the UK to Gibraltar as a result of the new measures under discussion?
I also ask the Minister about the condition, which I have described as interesting, about relationships with other territories with significant financial services markets. Why has it been written into schedule 6 as something that the Government should consider in their biennial review? Is it considered that this mini-single market will create some sort of vulnerability in those other relationships? Why is it thought possible that the arrangement might affect our relationships with other territories?
Finally, how unique and specific to the Gibraltar situation is the new regime? Could it conceivably be extended to other territories such as Jersey and the other Channel Islands? As the Minister will know, some Crown dependencies have been accused of being tax havens or of being susceptible to money laundering. Is it possible that such a regime could, in effect, be used to extend the reach of UK regulators to territories other than Gibraltar? This is a very big topic that has been debated quite a lot over recent years. I suppose I am asking about the Treasury’s thinking, rather than just about the Bill: might the arrangement with Gibraltar be a model for the treatment of other Crown dependencies or overseas territories, or should we view it as specific and purely a consequence of Gibraltar having to leave the European Union? I would be grateful if the Minister considered and responded to some of those points.
Alison Thewliss (Glasgow Central) (SNP)
It is a pleasure to see you in the Chair, Dr Huq. I just have a few quick questions, mainly coming from the evidence we heard last week. During the fourth sitting, at column 125, the Minister, Albert Isola, said that the Bill is akin to enabling legislation, and that other things would need to be worked through in relation to other aspects of the financial services that are currently dealt with. If the Minister could clarify what would happen about those other areas, that would be useful.
Secondly, perhaps the Minister could give further assurances about access to the Financial Ombudsman Service. It is important that consumers here should have adequate protections in the new arrangements, and that those should be made clear. That is the kind of scenario that would not be found out until a consumer needed to make a complaint. Something would have to go wrong for it to be addressed, and I would not want to be such a consumer, feeling in those circumstances that I did not have recourse to the protection that I would have had if I had chosen an insurance policy not based in Gibraltar. It would be useful to hear about that.
Lastly, it would be helpful to have any further clarity that the Minister can give about what would happen to UK businesses and customers if market access were suddenly withdrawn, and where that would leave consumers in the UK. Would they be left without policies and protection? What would happen as a reaction to that, should market access be withdrawn for a period of time? Would it mean that businesses would dry up, withdraw their UK services and go somewhere else, or does the Minister envisage other scenarios happening in that case? I appreciate that it is a scenario that he would want to avoid at all costs, but it could well arise, and I want to ask what state the Government’s preparations for such a scenario are in.
Ms Eagle
I suppose I want the Minister to reassure me about the fact that financial markets are rapid and regulation—if there is an equivalence regime, or mini-single market as my right hon. Friend the Member for Wolverhampton South East put it—allows the Gibraltarian authorities to do the regulation and then have immediate access to the UK. That may be done in a way that gives us some benefit; perhaps the Minister will say what the benefits of the regime are, particularly for UK consumers, given that Gibraltar does 90% of its business with the UK anyway. Perhaps he will also say what the risks would be.
My right hon. Friend spent a little time raising some of the risks and I suppose they can be characterised by the view that in a very liquid and rapid global money market, if there are vulnerabilities or back doors into regimes that are interconnected, that causes risks. We saw some of those risks playing out during the global financial crisis. To what extent does the Minister believe that the Gibraltar regime for which the clauses legislate will be—I am going to use that word—robust enough to prevent the opening of back doors to vulnerabilities for all sorts of money that is sloshing round the world? My right hon. Friend mentioned some of that—money used for money laundering, drugs and terrorism. It is important that the defences that we have against coming under that kind of influence should be maintained and strengthened, rather than weakened.
Stella Creasy
My hon. Friend is giving the speech that I wanted to give, so I thought I would intervene. One example, to express some of the concerns we might have, is the fact that in the Gibraltar regime there is currently no legal requirement to refuse registration to someone with a criminal record. In practice that does happen. It is something that the FATF report flags, but it is not inevitable. One thing we might want to think about for our regulatory regime—and I take the point made by the shadow Minister about not suggesting that the UK regime is perfect—is looking at whether there are lessons in the report that should be put into the Bill to make sure we do not create such a back door. That seems an eminently practical example of the sorts of things that might happen if people with criminal convictions, who may still be able to access financial regulations as a result of the Gibraltar regime, are now able to operate in the UK.
Ms Eagle
My hon. Friend gives an example of exactly the kind of point I was trying to make more generally about ensuring that these regimes are correct. Given that Gibraltar governs itself, the Bill makes it clear that Gibraltarian regulators will continue to do that job in Gibraltar and supervise the companies based there after this arrangement has been legislated for. That is quite proper in many ways, but it does give our regulators in a small number of narrowly-defined circumstances—I think this is the phrase—the duty or the right to leap in and do some regulation or enforcement presumably. Will the Minister say a bit more about that? He did mention it in passing in his introduction to the clause, in which he talked about financial stability. We clearly had some recent examples during the 2008 crash, where some robust enforcement had to take place with offshore island countries or territories that were trying to take money out of our jurisdiction in ways that were unacceptable at the time.
There is therefore a financial stability issue, but there is surely something about consumer protection, fraud and money laundering here as well. Perhaps he could talk in more detail about what those narrow circumstances are. Our regulators will be reluctant to romp and stomp all over Gibraltarian institutions and their regulators. Yet, by definition, Gibraltar is a small territory, and it will have less capacity to deal with some of the sophisticated fraudsters and international terrorist, money-laundering types than we do here. I am not saying that our regime is perfect, if we are honest, and we will get on to that later in the Bill.
My worry is that this might inadvertently create some vulnerabilities. I suppose what I am seeking from the Minister is some reassurance that the regulators have got a handle on this, that they will not allow the wish not to infantilise the Gibraltarian regulators to be a reason for not paying close attention to this, and that there will be some close supervision of what is happening, particularly once the regime is established. Once these things settle down, it is then that things start to happen. If a door is opened inadvertently somewhere, this money swilling around tends to find it, and then things can start changing very rapidly.
What warning flags does this regime put up to ensure that if that dynamic begins to happen, we can close it down rapidly? Does the Bill expect some kind of relationship between the Gibraltarian regulators and the Treasury? How does the Minister expect that relationship to work out? Obviously, I do not want to spend all my time being so negative about these things, so will the Minister also say a little more about what the benefits might be?
Will the Minister also talk about consumer protection in his response? Motor insurance is one of the largest components of the financial services that Gibraltar currently sells into the UK, and clearly there is a big retail consumer protection angle to such financial services.
Stella Creasy
While we are considering the variations for companies based in Gibraltar as opposed to the UK, it would be helpful if the Minister answered the question that the insurance bodies could not: about VAT benefits for companies based in Gibraltar and the likelihood, now that we have left the European Union, of companies moving more industry to Gibraltar because of that benefit, which could also affect consumers. Does my hon. Friend agree that it would be helpful if the Minister set out those figures? The industry seemed slightly coy when we spoke to it about those matters.
Ms Eagle
Clearly, the potential situation is there now. In evidence, the response—reasonably—was that that has not happened to date, even though there have been close connections between Gibraltar and the UK. However, these things tend to be dynamic and, once the agreement with Gibraltar is established, our tax regimes may diverge even further. If the Chancellor has his way after yesterday’s statement, I suspect they might have to.
Will that create more of a temptation for financial service companies to offshore to Gibraltar outside of the UK? Is the Minister convinced that that will not happen as a result of the Bill? I want reassurance from him about those potential weaknesses or risks and about consumer protections. He might even want to say a bit about benefits, if he feels up to it.
John Glen
I counted several questions in those four contributions and I will do my best to address them. First, I will reiterate what we are trying to do: to create the market access regime for Gibraltar-based financial services wishing to operate in the UK, and to make provision for outbound UK-based firms wishing to operate in Gibraltar.
The right hon. Member for Wolverhampton South East made a number of points, which I will start to address. He asked about the two-year reporting mechanism. The Gibraltar authorisation regime provides a broader and deeper market access into the UK market—including to the retail market—than other market access regimes, so the Treasury needs to be satisfied continuously that all conditions are met. We will therefore work carefully with the Minister we spoke to last week from the Government of Gibraltar to ensure that those conditions can be satisfied on an ongoing basis.
It is important to contextualise the nature of the relationship with Gibraltar. There has been a lot of dialogue, visits—not latterly—and evaluation of each other’s situation with respect to market access. In the lead up to the new regime, the Treasury will assess Gibraltar against the relevant market conditions for the sub-sectors to which it seeks access, and we will work closely with the Government of Gibraltar. The most significant area is the Gibraltarian insurance market, and 90% of that is UK facing.
The right hon. Gentleman compared the two-year review to our refusal to review the prudential regimes. As we have already discussed, the prudential measures include an accountability framework; we had a different view on the suitability of the one we suggested versus the amendment. The regulators have the expertise to set rules in the complex and technical areas of financial regulation and can do so in an agile way.
The right hon. Gentleman also referred to the FATF report. I have not read it in full, but I am aware of its broad indications of the challenges that exist. I am also aware that, while we had a good report, there are some challenges that we need to address in the UK. I will not hold back on admitting that. I will write to him specifically on those measures that pertain to Gibraltar, because I ought to do justice to his proper scrutiny.
There is an issue with the extension of the Gibraltarian regime to other countries. That is a bespoke regime that has been specifically designed for Gibraltar, recognising what the right hon. Gentleman and others will acknowledge is a special historical relationship, and our past common membership of the EU. These circumstances do not apply to any other jurisdictions, so that is not designed as a model or, as he said, a mini-single market to be extended elsewhere.
The hon. Member for Glasgow Central asked about the scope of the FOS jurisdiction over products sold by Gibraltarian firms. Our intention is that all Gibraltar-based firms with a schedule 2A commission will be covered by the FOS’s compulsory jurisdiction. That ensures that individuals and small businesses can seek appropriate redress. However, the extension of the FOS’s jurisdiction to schedule 2A firms does not require express wording in this Bill. The Bill makes schedule 2A firms a type of authorised person, so the FCA be able to make rules about them, bringing them inside the FOS’s remit. The FCA will be reflecting that change in the rules governing the FOS’s jurisdiction. Firms already under the FOS’s voluntary jurisdiction will transfer to the compulsory jurisdiction, with no loss of eligibility for their consumers in respect of actions occurring before they entered the compulsory jurisdiction.
The hon. Member for Glasgow Central also asked about the withdrawal of equivalence. If market access were to be withdrawn, schedule 2A puts in place winding down arrangements that enable the Government to pass secondary legislation providing for Gibraltar-based firms to exit the market in an orderly fashion, with appropriate protections for UK consumers. That is what would happen in market failure.
Stella Creasy
The Minister was just talking about the Financial Ombudsman Service being extended. One of the things that we might be concerned about is that our constituents might experience fraud from companies based in Gibraltar, perhaps in relation to insurance. Many of us can think of some famous Brexit backers who run insurance companies in Gibraltar and might have concerns about these issues. The FAFT report tells us that at the moment the supervision is only for new companies. There is a historical legacy of companies that have not previously been registered that might, therefore, under new supervision, be companies that we would not want to see operating in the UK. The Minister talked about the FOS’s requirements being retrospective, but that will be the same with the FCA. Can he clarify that if there are companies that are historically registered in Gibraltar, which we would not want to see registered here, perhaps because the people running them have criminal records, will they retrospectively be denied a licence, or is it only those from new registrations onwards, as with the current Gibraltarian regime?
John Glen
I wish to examine that matter carefully on the basis of the FATF report. I totally understand the clear point the hon. Lady is making about the retrospective nature of this and what could we essentially onshore, in terms of access to UK consumers, and the inherent and apparent risks in that. If the hon. Lady will permit me, I would like to examine that and get back to her.
The hon. Member for Wallasey asked about the independent Gibraltarian regulator and whether it will remain the supervisor of Gibraltar-based firms. The explicit intention for the UK regulators, contained in proposed schedule 2A, is to guarantee the protection of UK consumers, but that will be exercisable only on specific grounds, for example where a situation is urgent or if a Gibraltar-based firm is contravening a rule. We are not trying to take over their regulator.
The hon. Lady asked if the parties will co-operate sufficiently. There has been close and frequent co-operation over the past three years, between both Governments and regulators. They are developing their regime, and I am confident that will continue. The Minister in Gibraltar —effectively, my opposite number there—was positive about that last week. Schedule 2A will create a framework for this effective co-operation. That also means that the UK and Gibraltar Governments, the respective regulators and the Financial Services Compensation Scheme will put in place effective procedures to carry out any dialogue and co-ordinated action for the good functioning of the regime.
The hon. Members for Walthamstow and for Wallasey asked about consumer protection. It is obviously of the upmost importance that we provide the right level of protection for UK customers of Gibraltarian products, and that the level of protection afforded is communicated to them. Under this regime, most UK-based consumers purchasing products from Gibraltarian providers will receive a similar level of compensation as those purchasing their products from UK firms, whether through the FSCS or through the equivalent Gibraltarian schemes.
John Glen
I beg to move amendment 4, in schedule 6, page 100, line 31, at end insert—
“(i) an order under section 143S, or”.
This amendment extends the definition of “prohibition order” in paragraph 19 of new Schedule 2A to the Financial Services and Markets Act 2000 to include an order under section 143S (inserted by Part 1 of Schedule 2 to the Bill).
John Glen
These very simple and limited amendments are necessary to ensure that the measure functions as intended. As the explanatory note states, amendment 4 expands the definition of “prohibition order” in paragraph 19 of new schedule 2A to the Financial Services and Markets Act 2000 to include an order made under section 143S, as inserted by part 1 of schedule 2 to the Bill.
The amendment ensures that UK regulators can reject a notification in relation to a Gibraltar-based firm if a senior manager of the Gibraltar-based firm is prohibited from performing a function by a part 9C prohibition order made under new section 143S, in line with the treatment of other firms in the Bill. A part 9C prohibition order may be made by the FCA in relation to an individual if the FCA believes that the individual is not of sufficiently good repute or does not possess sufficient knowledge, skills and experience to perform a function relating to an activity carried on by a non-authorised parent undertaking of an FCA investment firm.
Amendment 5 expands the definition of “prohibition order” in paragraph 19 of new schedule 2A to the Financial Services and Markets Act 2000 to include an order under the law of Gibraltar that the appropriate UK regulator considers to be equivalent to an order under section 143S as inserted by part 1 of schedule 2 to the Bill. That is a simple and limited expansion enabling the UK regulators to reject a notification if a senior manager of a Gibraltar-based firm is prohibited from performing a function by a prohibition order under the law of Gibraltar that they consider to be equivalent to an order under section 143S.
Finally, amendments 6 to 11 clarify the UK regulators’ powers to give directions altering the meaning of “protected contract” and “existing contract” for the purposes of part 10 of new schedule 2A to the Financial Services and Markets Act 2000 in the event that a UK regulator or the Gibraltar regulator cancels the permission of a Gibraltar-based firm.
Amendment 4 agreed to.
Amendments made: 5, in schedule 6, page 100, line 34, after “56” insert “or 143S”.
This amendment extends the definition of “prohibition order” in paragraph 19 of new Schedule 2A to the Financial Services and Markets Act 2000 to include an order under the law of Gibraltar which a UK regulator considers to be equivalent to an order under section 143S (inserted by Part 1 of Schedule 2 to the Bill).
Amendment 6, in schedule 6, page 123, line 32, leave out “67” and insert “67(1)”.
See the explanatory statement for Amendment 11.
Amendment 7, in schedule 6, page 123, line 38, leave out “67” and insert “67(2)”.
See the explanatory statement for Amendment 11.
Amendment 8, in schedule 6, page 124, line 37, leave out “67” and insert “67(1)”.
See the explanatory statement for Amendment 11.
Amendment 9, in schedule 6, page 124, line 43, leave out “67” and insert “67(2)”.
See the explanatory statement for Amendment 11.
Amendment 10, in schedule 6, page 125, line 17, leave out
“this Part of this Schedule”
and insert
“paragraph 64 or 65 (or both)”.
See the explanatory statement for Amendment 11.
Amendment 11, in schedule 6, page 125, line 19, leave out
“The power under sub-paragraph (1) includes power to”
and insert
“A UK regulator may, by giving a direction,”.—(John Glen.)
This amendment and Amendments 6, 7, 8, 9 and 10 clarify the UK regulators’ powers to give directions altering the meaning of “protected contract” and “existing contract” for the purposes of Part 10 of new Schedule 2A to the Financial Services and Markets Act 2000.
Question proposed, That the schedule, as amended, be the Sixth schedule to the Bill.
John Glen
New schedule 2A to the Financial Services and Markets Act 2000 sets out in detail the operation of the new market access arrangements for Gibraltar-based firms into the UK. Part 1 of the schedule defines key concepts of the new framework, such as approved activity. Part 2 sets out that the Treasury will be able to designate a regulated activity as an approved activity for market access only if the following conditions are met: if approval of an activity is compatible with certain objectives, such as financial stability and consumer protection; if the Treasury is satisfied that the relevant law and practice between the UK and Gibraltar is sufficiently aligned; and if the Treasury is satisfied that there is co-operation between the UK and Gibraltar Governments, our respective independent regulators and the FSCS.
Part 3 will introduce a simple notification process by which Gibraltar-based firms will be able to obtain permission to carry on an approved activity. I stress that this is not intended to be an application process; Gibraltar-based firms will automatically obtain a schedule 2A permission once the period for the UK regulators to consider a notification has expired. Parts 4 to 6 provide for the Gibraltarian regulator or the UK regulator to be able to vary or cancel a schedule 2A permission, or to impose, vary or cancel requirements on a Gibraltar-based firm, and set out the process the regulators could follow in each case. None of those powers dilutes the fact that Gibraltar-based firms will continue to be supervised by the Gibraltarian regulator and remain subject to the laws of Gibraltar. The intervention powers for the UK regulators will be available only in specific defined circumstances, as set out in paragraph 28. The option of withdrawal of approval for an activity will remain available to the Government as a tool of last resort. However, were any issues to emerge, the Treasury would work closely with the Gibraltarian authorities to ensure that all conditions of market access can be satisfied.
To provide clarity and transparency, part 11 will require each UK regulator to issue a statement of its policy on the use of its intervention powers. Part 12 imposes duties on the UK regulators to inform, consult and obtain consent from one another, as well as to keep the Gibraltarian regulator informed to support the functioning of the regime. Similarly, part 13 will require co-operation between the UK and Gibraltar Governments, our independent regulators and the manager of the FSCS, including setting out procedures and approaches to resolving any supervisory concerns to support the delivery of the regime.
I have summarised the effects of proposed new schedule 2A in the legislation. It sets out in great detail the new market access arrangements for Gibraltar-based firms looking to operate in the UK and it will lead to the renewal and strengthening of our relationship with Gibraltar. For that reason, I therefore recommend that the schedule be agreed to.
Question put and agreed to.
Schedule 6, as amended, accordingly agreed to.
Schedule 7 agreed to.
Schedule 8 agreed to.
Clause 23
Power to make provision about Gibraltar
Question proposed, That the clause stand part of the Bill.
John Glen
The new regime introduced by clause 22 revolves around activities covered by the so-called Gibraltar order, which provides Gibraltar-based firms accessing UK markets and UK-based firms accessing Gibraltar markets with rights equivalent to the passporting rights conferred on European economic area firms. Certain regimes conferring rights on UK and Gibraltar firms sit outside the remit of the Gibraltar order, as they are authorised not under the Financial Services and Markets Act but under separate regulatory regimes, and therefore need to be addressed separately.
The majority of these regimes are not as central to the UK-Gibraltar bilateral relationship as the regimes under clause 22, as they represent smaller sub-sectors such as e-money and payment services. The Government are requesting a delegated power to make provision for these regimes, which will allow the Treasury to safeguard the rights that Gibraltar firms currently exercise, to ensure that the legislative framework works efficiently and, wherever possible, to subject these regimes to principles and mechanisms similar to those in the new section 32A of and schedules 2A and 2B to the Financial Services and Markets Act, to ensure consistency with the rest of the regime introduced by clause 22.
Regarding the regime introduced by clause 22, it is right and proportionate that the Government are able to make adjustments to take account of the UK’s and Gibraltar’s new position outside the European Union and in relation to the regimes not captured by the Gibraltar order. The power that the Treasury is requesting is not unlimited, but is constrained at multiple levels. The power is limited in scope, as it only applies to a narrow pool of legislative regimes, as described in clause 23, which are not covered by clause 22. Further, this power can be exercised only in a manner that is compatible with the objectives set out in clause 23, such as financial stability and consumer protection. In addition, the Treasury must consult the FCA, the PRA and the Government of Gibraltar before making certain regulations. Finally, all regulations made in the exercise of this power will be subject to the affirmative procedure, giving Parliament effective oversight of the exercise of these powers by the Treasury.
The clause is crucial to ensuring a consistent approach to regulatory supervision, co-operation and other relevant standards and requirements across different financial services regimes. It achieves the right balance between accountability and effectiveness, so I recommend that the clause stand part of the Bill.
Ms Eagle
Given that some of the areas caught by this part of the regulation were previously quite esoteric, but might not be so esoteric in the not-too-distant future—I am thinking of electronic money, which a few years ago would have been a tiny amount of transactions and is now very much larger—can the Minister reassure the Committee that, if the size and importance of these transactions grow, they are confined in the right area of the law for regulation? Does the Treasury have any views on how to take account of the changing importance and size of this area and to change the regulations around it in future? As we see, the pandemic has meant that many people who used to use cash no longer use it. Payment services and e-money are growing areas and could grow rapidly.. Is he convinced that this is the right regime to have in and around areas of perhaps rapid evolution?
John Glen
I thank the hon. Lady for that relevant question about how we intend to apply these powers to smaller regimes that are of increasing significance to consumers and potentially to stability. As a Government, our intention is to ensure that existing cross-border activities are not disrupted in any way. We are asking for the ability to update these regimes to reflect the growing relationship and the evolving domestic mechanisms and principles.
To some extent, many of these areas being looked at now—crypto-assets, stablecoins and so on—are evolving globally and there is is a spectrum of approaches, so we need to examine the appropriateness of the application. We would work to examine closely where the risks are, and therefore where the application of new and evolving orthodoxies of regulation would apply to Gibraltar. We are committing to ensuring that the necessary legislative arrangements are in place in any event, but we rule nothing out in terms of scope and application to new sectors as the world of financial services evolves, which it has done considerably in recent years.
Question put and agreed to.
Clause 23 accordingly ordered to stand part of the Bill.
Clause 24
Collective investment schemes authorised in approved countries
Question proposed, That the clause stand part of the Bill.
John Glen
The clause introduces the new overseas funds regime, which delivers on the Government’s commitment to introduce a simpler way for large numbers of investment funds from other countries to be marketed to retail investors, including the general public. The OFR will promote openness to overseas markets, allowing the UK to offer broad market access to investment funds from other countries. It will also allow consumers to benefit from the widest possible choice of funds, while maintaining existing levels of investor protection.
The new regime could provide a more efficient way of allowing large numbers of investment funds from the EEA to market to retail investors on a more permanent basis. Many EEA funds are marketed into the UK through the EU’s passporting regime, which will end after the transition period. Although the Government have introduced a temporary marketing permissions regime to allow existing EEA funds to continue marketing after the transition period, these funds will need to apply for permission to market on a more permanent basis. If the OFR were not legislated for, the funds would have to apply for recognition under the existing regime; that regime allows overseas funds to be marketed to the general public, but it requires an assessment of each individual fund. Establishing the OFR could therefore provide a more permanent basis for these EEA funds to continue marketing in the UK, provided that the EEA member states are found equivalent. It will also allow for the possibility of funds in other countries gaining easier access to the UK if they meet the criteria set out in the schedule. The new regime has been welcomed by the UK’s asset management industry, and the majority of consultation respondents were highly supportive.
I will now detail how clause 24 introduces the new OFR. The clause adds to the legal definition of a recognised scheme, so that it includes funds recognised under the OFR. That will allow the funds to market to the general public in the UK. The clause also introduces schedule 9 to the Bill, which comprises the main operational elements of the OFR and any minor and consequential amendments needed to ensure the new regime is fully functional. Compared with the current assessment of individual funds, the OFR enables the Treasury to make equivalence determinations which allow specified categories of funds from other countries and territories to be marketed in the UK. Therefore, the OFR has the potential to promote the interconnectedness of financial markets and consumer choice, to provide a more appropriate basis for recognising the large number of EEA funds currently marketing through the temporary marketing permissions regime, and to support bilateral agreements with other countries.
The clause is necessary to ensure that the OFR is inserted into the relevant legislation and can fulfil its potential. I recommend that it stand part of the Bill.
Mr McFadden
I thank the Minister for his explanation. As he said, this clause, schedule 9 and clause 25 create an overseas fund regime for establishing the recognition of collective investment schemes based outside the UK. It is estimated that there are about 9,000 such schemes, which are often known as UCITS.
Up until now, those schemes have operated under the European Union’s passporting provisions, as have UK-based schemes operating in other countries; it has been a two-way street. It was not inevitable that passporting had to end when the UK left the EU. There were models of leaving that could have preserved those rights for UK-based firms. Indeed, there were votes in Parliament that sought to guarantee the continuation of passporting rights, but the Government set their face against that, so the first thing to say about these provisions is that the need for them has arisen out of choices made by the Government.
That there would be an adverse impact on services from this decision was acknowledged. It seems the dim and distant past now, but back in the halcyon days of 2018, we had something called the Chequers plan. That document was issued in July 2018 with—I noted when I had another look at it—a foreword from the current Foreign Secretary. The Minister could usefully remind him of that the next time he bumps into him. The document said that the Government
“acknowledges that there will be more barriers to the UK’s access to the EU market than is the case today.”
It went on to note that
“these arrangements will not replicate the EU’s passporting regimes”.
Let us look at what the document’s verdict was on equivalence, which is the thing that we are trying to achieve and in part legislate for today. This is the Government’s own verdict on the kind of regime in clauses 24 and 25 and schedule 9. It said:
“The EU has third country equivalence regimes which provide limited access for some of its third country partners to some areas of EU financial services markets. These regimes are not sufficient to deal with a third country whose financial markets are as deeply interconnected with the EU’s as those of the UK are. In particular, the existing regimes do not provide for:…institutional dialogue…a mediated solution where equivalence is threatened by a divergence of rules”—
we have discussed divergence of rules quite a lot in this Committee—
“or supervisory practices…sufficient tools for reciprocal supervisory cooperation…This would lead to unnecessary fragmentation of markets and increased costs to consumers and businesses; or…phased adjustments and careful management of the impacts of change, so that businesses face a predictable environment.”
That is not my verdict on equivalence; it is the Government’s verdict on equivalence when they published their own plan two years ago. So there we have it in the Government’s own words. That which they have been as yet unable to secure from the EU was dismissed as inadequate for the UK’s financial services sector even if we were able to secure it, which we have not, or at least not yet. The Government were aiming for something different, because it was deemed by them to be inadequate. They were aiming for
“a bilateral framework of treaty-based commitments to…ensure transparency and stability”,
because, as the document goes on to say, equivalence
“is not sufficient in scope for the breadth of the interconnectedness of UK-EU financial services provision. A new arrangement would need to encompass a broader range of cross-border activities”.
The Government wanted common principles, supervisory co-operation and
“a shared intention to avoid adopting regulations that produce divergent outcomes”.
Where did all that go? What happened to all of that? That was the aim. Why is it now the summit of the Government’s ambitions to achieve an outcome for the UK’s globally significant financial services sector that they dismissed as inadequate only two years ago? Why is this not at the heart of the UK-EU negotiations, in this crucial period? We have just over a month left—less, in real terms—to strike a deal. We must think of the significance of this sector to the UK economy and look at the employment, the investment and the tax revenue.
Stella Creasy
The shadow Minister is making a powerful case, and I suspect he is about to move on to this point. In layman’s terms, the Government are asking financial companies, which represent hundreds of thousands of jobs in our country, to deal with more paperwork, more bureaucracy, more regulation and a tougher business environment in which to operate. Does the shadow Minister think that these major financial companies are going to adhere to that because they are rather fond of London, or might they make different commercial decisions because we have not secured the kind of regulation he is talking about as yet and move themselves to other parts of the European Union?
Mr McFadden
We will come on to their reaction. It is extraordinary that a sector this important has been relegated so far in the Government’s priorities. It is absolutely extraordinary that in these final days of renegotiation this is not front and centre. We just need to look at the employment, the investment and the tax revenues, and the role that the sector can play in global standards. Yet it has been relegated by the Government to an outcome that they admit is inferior and which, right now, they have not even been able to achieve.
All we can legislate for here is what we do. The fact that it is not front and centre of the negotiations right now speaks volumes about how far we have drifted from talk of achieving all the same benefits and securing a free trade zone from Iceland to the Urals—do hon. Members remember that? All of that has gone.
Mr McFadden
That is the OBR’s estimate of the additional cost of a no-deal scenario, on top of the already long-term hit in the deal scenario. My hon. Friend is absolutely right to set that out.
The fact that this has happened slowly over the past couple of years, and maybe the fact that the industry has become weary of arguing about it—as, perhaps, have all of us—should not disguise the importance of what has happened. It is important to set that out and to put these clauses in perspective. The Government chose to relegate the importance of UK financial services industries in the Brexit negotiations. Having made that decision, they then relegated financial services even further by aiming for an outcome that they openly admitted was inadequate, and they have not even been able to achieve that outcome. That is the context of these clauses.
I have a few questions on the details of the regime being established by the clauses. First, how does this relate to the Chancellor’s statement on financial services on 9 November? The clause and schedule 9 set out a country-by-country approval system for equivalence decisions, but in his statement on 9 November the Chancellor said that he was publishing a set of equivalence decisions for the UK and the EEA member states—those member states who still have access to these passporting rights, even though they are not EU members. Clause 24, as I said, implies a country-by-country process. Does the Chancellor’s statement mean that in policy terms, the equivalent recognition has already been given to all EU and EEA member states? Is that for all the financial products that are produced to which such equivalence might apply—that is, those traded on a cross-border basis?
Alison Thewliss
I have one or two further questions about people who are invested in things for which equivalence is withdrawn. The Association of British Insurers said in its written evidence:
“While the regime states that investors can stay invested in funds if equivalence has been withdrawn, they do not to spell out the practicalities of the situation an existing investor may face if a fund they are invested in has been suspended, for example if additional money is invested after a fund suspension. For the regime to fully work for consumers, situations such as this need to be clarified.”
What happens to investors in those funds if equivalence is withdrawn? What information will they receive from the Government, from regulators or from anybody else if that happens, so that they know what they have to do in that scenario, if anything? That could affect many people and would be very complicated to unravel, so it would be useful to set out people’s obligations in those circumstances.
John Glen
We were treated to more of a Second Reading response there from the shadow Minister, with all that he said about the frustrations of the last three years. Having been Minister for three years under three Chancellors and seen the evolution in the nature of that negotiation, I have a lot of empathy with his analysis about the evolving nature of a negotiation, which is of course what happens.
I can tell the right hon. Gentleman that the whole issue of the importance of financial services has gripped me since 9 January 2018, when I came into the role, and he is absolutely right to say that it is a very important industry and that we must do all that we can to maximise opportunities for it. I very much regret where we are on what we thought would be a technical process of equivalence granting. We filled in 2,500 pages of forms over about 40 questionnaires by June last year and, self-evidently, we have been leaders in the regulation of financial services within the EU. We have not heard anything from the EU on the equivalence determinations, which is strange. We regard the EU as some of our most important trading partners, and we look forward to continuing a constructive dialogue.
The right hon. Gentleman raised a number of questions about the Chancellor’s statement, the registration process and the situation for jurisdictions beyond the EU, and I will address those. On the equivalence for UK firms, although the EU does not currently have an equivalence regime for the marketing of investment funds—we cannot speak for any future changes to the EU’s equivalence framework—the Government are introducing the new equivalence regime for overseas investment funds to market to UK retail investors, to allow our consumers to benefit from the widest possible choice of funds. We are doing that to support and preserve consumer choice for UK investors. Currently, about 9,000 EEA-domiciled funds use passporting to market to retail investors in the UK. That makes up a substantial proportion of the overseas funds that are on offer to UK investors. In comparison, about 2,600 UK-domiciled funds are available to UK investors, and UK funds do not commonly sell into the EU.
The geographic scope of the OFR could be used to find any jurisdiction equivalent, but a fund from another jurisdiction could be permissible even if the jurisdiction is not equivalent. That would use a different process—the existing process, which I think is provided for in section 272 of the Financial Services and Markets Act 2000. We hope and expect to refine that to align it with this process to remove any uncertainty.
The Chancellor’s announcement of 9 November, when we made 17 equivalence decisions, is separate to the OFR, which is a new equivalence regime that the UK is introducing for EEA funds. The withdrawal of equivalence can happen at the country level, but the FCA has powers to suspend or revoke the marketing permissions of individual funds. If funds from a country are found equivalent under the OFR, they will not need to go through the section 272 provision, so this will be a faster route.
The hon. Member for Glasgow Central asked what happens to investors if equivalence is withdrawn or a fund is suspended. Obviously equivalence is necessary to ensure that UK investors can assume at least equivalent investor protection to that of the UK. If the Government believe that that is no longer the case, it would be appropriate for the Treasury to act and to make that clear to potential existing investors by withdrawing equivalence.
We recognise the importance of clarity and stability regarding the potential withdrawal of equivalence, so withdrawing an equivalence determination will be undertaken in an orderly and controlled manner to ensure that investors are protected and businesses have time to adjust. In the event of equivalence being withdrawn, funds from the country or territory in question will no longer have recognised status and can no longer be marketed to the general public in the UK.
The Treasury does not envisage that investors will be forced to divest their investments in the fund, and the funds should continue to service them; however, the loss of recognition could make it more difficult for investors to continue investing in the fund.
For example, the loss of recognition might result in investment platforms no longer offering the fund on their platforms. The Bill also includes a power so that the Treasury can take steps to smooth the transition for funds to the existing regime if equivalence has been withdrawn.
Alison Thewliss
I thank the Minister for that clarification. I am just trying to get my head around the practicality or how this would work. If equivalence is withdrawn, how do people who have money in the funds find out about it? Is there an obligation on the funds to tell them, or on the Government to ask the funds to tell them? Do the Government somehow contact these people, and what is the timeline of those things, should that occur?
John Glen
That procedure would depend on the particular breakdown of the fund and the scale of the problem. It would be for the regulator to work with the individual fund to demonstrate that, and to give clarity to consumers. It is difficult without a specific example to set that out, but the provision is there and the provisions are comprehensive in terms of being able to do that.
The right hon. Member for Wolverhampton South East asked about the relationship between equivalence and the divergence allowed for by the Bill. The Bill makes no assumptions about what the relationship between the UK and the EU will be in the area of financial services. That negotiation is ongoing. That is entirely consistent with the mutual findings of equivalence. It ensures that the right framework is in place for making equivalence decisions and for ensuring that any likely impact on existing equivalence decisions is taken into account when making rules in an area covered by the Bill.
I have tried to cover everything that has been raised. I am sure that I have not covered everything, but if I find anything substantive when I reflect on today’s proceedings, I will write to the right hon. Gentleman and make the letter available to the Committee.
The Chair
These letters are coming back quite quickly. The one from the other day is already here, so we look forward to any future ones.
Question put and agreed to.
Clause 24 accordingly ordered to stand part of the Bill.
Schedule 9
Collective investment schemes authorised in approved countries
Amendments made: 12, in schedule 9, page 151, line 16, leave out
“granting an application under section 271A”
and insert
“under section 271A granting an application under that section”.
This amendment clarifies that both the application and the order are made under section 271A.
Amendment 13, in schedule 9, page 154, line 43, leave out “271G” and insert “271A”.
This amendment and Amendments 14, 15, 16 and 17 correct cross-references to the section under which an order recognising a scheme is made.
Amendment 14, in schedule 9, page 155, line 14, leave out “271G” and insert “271A”.
See the explanatory statement for Amendment 13.
Amendment 15, in schedule 9, page 155, line 24, leave out “271G” and insert “271A”.
See the explanatory statement for Amendment 13.
Amendment 16, in schedule 9, page 156, line 7, leave out “271G” and insert “271A”.
See the explanatory statement for Amendment 13.
Amendment 17, in schedule 9, page 156, line 29, leave out “271G” and insert “271A”.—(John Glen.)
See the explanatory statement for Amendment 13.
Schedule 9, as amended, agreed to.
Ordered, That further consideration be now adjourned.—(David Rutley.)
National Security and Investment Bill (Third sitting)
Thursday 26th November 2020
(4 years, 1 month ago)
Public Bill CommitteesRead Full debate National Security and Investment Bill 2019-21 View all National Security and Investment Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 26 November 2020 - (26 Nov 2020)
The Chair
Q
I welcome the two witnesses from Slaughter and May. Can I ask you to introduce yourselves for the record, please?
Lisa Wright: Hi, my name is Lisa Wright and I am a partner in the competition group at Slaughter and May.
Christian Boney: Good morning. I am Christian Boney and I am a partner in the corporate mergers and acquisitions group at Slaughter and May.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Q
I am sure you are aware that many countries—the US and Canada are just two—give some sense of the factors that might be considered under a national security assessment. Do you think it would be helpful for market participants to have greater clarity about the types of factors that would be considered? How could we give that clarity while retaining the sensitivity and discretion that are needed on those matters?
Joined to that, there are cases such as Arm and DeepMind where economic security became national security over time. When considering what national security is, what links do you see between national security and economic security or sovereign capability? Can they better be reflected in the Bill?
Christian Boney: Lisa, shall I have a go at that first?
Lisa Wright: Yes, go for it.
Christian Boney: Starting with the need for factors to help inform market participants’ decisions about whether, for example, their potential transaction presents risks, yes—in short, the more guidance that can be given about the kinds of factors that the Government will consider in determining whether a transaction presents a national security concern, the better. The statement of policy intent is very helpful in framing that, but clearly the more detail that can be included, the better.
The other thing that will be important in giving people a sense of whether their transaction should be notified or whether it falls within a mandatory notification sector is the interaction that will take place through informal engagement through the investment security unit. It is very important that the process for getting informal guidance from that unit is as streamlined, interactive and responsive as it can be. That will go some way to giving practitioners realtime guidance on potential concerns.
Lisa Wright: Can I just add a point to the idea of the desire for more certainty around what national security means? I think it is worth recognising that that is particularly important if you look at where we have come from. With the existing regime under the Enterprise Act 2002, there have only ever been a dozen or so interventions on national security grounds. There is not a widespread understanding of what it means and the circumstances in which the Government would intervene. That is the historical position, but we all know that this is constantly evolving.
When you take that and add to it the fact that the prediction now is that there will be, as it says in the papers, between 70 and 90 call-ins a year, that is obviously a huge increase against the 12 since the Enterprise Act. Any greater clarity that can be given around the circumstances in which the Government would be looking to, for instance, exercise the call-in powers would be beneficial, particularly at the beginning of the regime when everybody is trying to learn the ropes.
Chi Onwurah
Q
Christian Boney: I think this question really divides into two. In terms of larger corporates, investment by, and in, larger corporates is very likely to be unimpacted in any meaningful way by this legislation, because large corporates and their advisers are very used to going through regulatory clearance processes. This will just be another thing that needs to be added to the list.
I think you make a very valid point in the context of start-up and early-stage companies. The concern I would have principally is with those companies that are in that phase of their corporate life and fall within the mandatory notification sectors. Given the kinds of companies that this country is trying to encourage to flourish—those that are active in areas like artificial intelligence, advanced robotics and quantum technologies—a reasonable number of start-ups, I would expect, would fall within those mandatory notification sectors. For them, this regime is going to make the process of getting investment more time-consuming and more complex.
Anything that can be done in the process of consulting on the mandatory sectors, and anything that can be done to pair back the regime to make it more workable for companies in that stage of life, the better. An example might be some form of de minimis threshold, which is included, such that really early-stage companies do not fall within the mandatory notification regime, but the Government can nevertheless rely on their call-in power down the track, should that early-stage company becomes successful and more strategically important within the UK. Those are my principal thoughts. Lisa, do you have anything to add?
Lisa Wright: Not on that point, no
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Nadhim Zahawi)
Q
Chi Onwurah
To clarify, my question was this: how would you distinguish between national and economic security?
Nadhim Zahawi
My question is more about your reflections on the Bill being narrow in its purpose to deal with national security versus the wider public interest.
Lisa Wright: It is already a very broad regime; it catches a lot of transactions, as we have just discussed. I therefore think it is important and right that it is limited, in terms of the substantive concerns that it is catching, to national security. That is already a necessarily, I think, uncertain or undefined concept. Corporates and investors can make it work as long as other aspects of the regime work efficiently. That may be subject to some of the points that Christian just made about the impact on start-ups.
I think that once you broaden the regime out from national security into other considerations, you do risk introducing quite a degree of unpredictability, which possibly would impact on people’s assessment of the investment climate in the UK. My understanding is that the existing intervention regime under the Enterprise Act is planned to remain in force, so the national security considerations will come out of that and will be dealt with under this new regime. But there will still be the ability for—[Inaudible.]
The Chair
Mr Boney, do you have any observations while we are waiting for the tech to work?
Christian Boney: I agree entirely with what Lisa has been saying. I think the scope of the Bill is already broad, so to my mind, broadening it further to take account of other areas is likely to introduce the uncertainty that Lisa was referring to and, as a consequence, have a potentially negative impact on the investment climate in the UK.
The Chair
Lisa, it looks like we have got you back now. Would you like to add anything?
Lisa Wright: I am not sure at what point you lost me, but I think I was saying—
Nadhim Zahawi
We lost you while you were talking about a “degree of unpredictability”, Lisa.
Lisa Wright: Okay. In my view, if you were to broaden the regime out from national security to take into account other considerations, that would introduce quite a degree of unpredictability and would, I think, potentially impact negatively on people’s assessment of the investment climate in the UK—I am sorry if I am repeating myself. However, my understanding is that the existing intervention regime will remain, so national security will come out of it, but the Government will still be able to intervene in transactions on other public interest grounds under the Enterprise Act. That regime has some limitations, but those powers will still be there.
Stephen Kinnock (Aberavon) (Lab)
Q
Christian Boney: I think the de minimis concept is potentially relevant and helpful in the context of thinking about what needs to be subject to mandatory notification. If you are not within the mandatory notification regime, that does not mean that the Government cannot exercise the call-in power so long as the relevant tests in the legislation are satisfied; it just means that the relevant company does not have to make a notification. There are elements of the mandatory sectors where some form of de minimis has already been included. Energy is a good example of that, and that makes sense in the context of energy.
I think it is worth exploring whether, within any of the other sectors, where we are more likely to see start-up, early-stage companies operating, there is benefit in introducing some form of de minimis regime solely in respect of the mandatory notification requirement. As I say, if a small-scale company operating in critical artificial intelligence is receiving investment from somebody who we view as a hostile actor, that transaction might escape mandatory notification, but that does not mean it escapes voluntary call-in by the Government at the point they become aware of it. That is something that might be worth exploring.
Stephen Kinnock
Thanks very much. Does Ms Wright want to add anything?
Lisa Wright: No.
Stephen Kinnock
Q
Christian Boney: If I am following the question correctly, I think it is the correct balance to strike to say that people pursuing significant M and A activity involving the UK’s critical national infrastructure should expect to go through a notification process and should expect their transaction to be at potential risk of examination and call-in. From my experience, corporates undertaking transactions in the spheres of national infrastructure and so on expect that. It is what they see in other countries and jurisdictions, so it is something they come to accept as part of doing deals in top-tier democratic nations.
Lisa Wright: I agree with all that. I guess I would also add that people are well aware that these considerations change over time. This year has shown that more than ever. People have an eye on what might not have been an issue yesterday; today, it might be different. We saw the amendments coming through to the Enterprise Act earlier in the autumn to bring in the power to allow the Government to intervene on public health grounds. People are very conscious of the fact that this changes, and they keep an eye on it from that perspective.
Simon Baynes (Clwyd South) (Con)
Q
I would have thought that there are two aspects to that. One is the nature of the acquirer, which is partly what you have already alluded to. The second part is that I would have thought that it is quite difficult to ascertain whether something at the cutting edge of technology is or is not a threat. I would have thought that that is a really difficult judgment to make in practice. Do you have any thoughts on that, and what experience do you have of other regimes trying to make that kind of judgment?
Lisa Wright: I think there are probably a number of ways to tackle that question. I guess that an answer is that it is ultimately a question for the Government. They are the ones who understand the threats and the intelligence. As advisers, we can look at the guidance and cases that have happened in the past, and we can speak to the unit, which, as we understand it, will be open for engagement and will welcome that. We can guide clients through the process, using the touch points and information that is available to us, but ultimately it is the Government that are in possession of the full set of facts and considerations that go into the decisions about whether that particular transaction is a problem or not. I guess what that speaks to is having the right people in the unit and getting them plugged into the right people elsewhere in Government to arm them with the ability to make these assessments.
Christian Boney: To pick up on that, I agree entirely with what Lisa said. It is not necessarily an easy thing for the advisory community or clients themselves to make a judgment about whether they are presenting risk to national security. That is why this concept of real-time, interactive engagement with the unit that is set up to police this regime is going to be so important.
In the world I operate in, one of the regulators we deal with is the Takeover Panel, which is fantastic at being responsive, with real-time engagement. It results in a dialogue and an interaction that helps advisers navigate their clients through a regime that is not straightforward at times. That is the kind of practice that could usefully be learned from in the context of the investment security unit, because that kind of real-time feedback and informal advice will be very helpful in helping companies make the judgment about which side of the line they fall.
Peter Grant (Glenrothes) (SNP)
Q
There is a fair amount of information in the Bill and the documents published alongside it about the kinds of businesses being acquired or taken over that might give rise to concern. There are quite clear definitions of what constitutes a trigger event, whether it is a purchase of shares or whatever, but there is very little detail about how the Secretary of State will decide which potential acquirers pose a threat. There are clearly good reasons why that information cannot be made public in too much detail, but is the fact that there is so little on the face of the Bill about how that decision is arrived at a problem? Does it make it less certain and therefore more likely to result in legal challenge?
Christian Boney: Acquirer risk is one of the points picked up in the statement of policy intent that is going to be looked at when determining the level of risk that a transaction presents. When looking at and explaining acquirer risk, I think that helpful additional guidance could be added to it to, for example, make clearer how the Government will consider acquirer risk in the context of things such as private equity funds and other funds that may be looking to invest in the UK. By that, I mean in particular whether the Government will be willing to disregard the identity of limited partners and other investors in funds that sit above the particular acquisition vehicle that is doing the relevant transaction. That is the kind of thing that I think there would be real benefit in trying to make clearer in the statement of policy intent.
Peter Grant
Q
The Companies Act 2006 has similar requirements for a company to notify Companies House if certain things happen that put someone in a position of significant influence. From a lay person’s point of view, such as my own, some of those provisions are almost word for word the same in the Companies Act and the Bill. Some appear to have the same effect but the wording is different, and therefore there will potentially be occasions when the definition is different. Would there be benefits in completely aligning both pieces of legislation so that a particular event either has to be notified or does not have to be notified? Otherwise, there is the possibility that some events will have to be notified under the Bill, and other events will have to be notified under the Companies Act but not the Bill.
Christian Boney: In short, I think there would be benefit in having as much alignment as there can be. Clearly, the two pieces of legislation are not necessarily designed with the same intent and focus in mind. Yes, I think there is merit in having as much alignment between the two as there can be.
If I may, there is just one point about the trigger events that is worth considering. One of the points in the statement of policy intent in the context of trigger events is the Government considering the risk of espionage. That seems to me to be something that is worth thinking about in the context of this regime. At the moment, the trigger events are focused, as you were saying, on the ability to influence a particular company, but there are certainly circumstances where, without acquiring a level of shareholding that enables a person to influence the company, the person can nevertheless gain very significant access to information—for example, through a board seat, which might come at a shareholding of lower than, for example, 15%. That would give that person considerable access to information within the company. If they were a hostile actor and they wanted to act in a nefarious manner, it would enable them to feed that information back to another hostile party. We have spoken about narrowing the scope of the regime, and I appreciate that that would be an amplification of it, but I think that is a point that is worth considering.
Mark Garnier (Wyre Forest) (Con)
Q
The other thing is that a start-up company can raise money in other ways. The Bill tries to make sure that we are not losing intellectual property, but a business can raise finance by licensing the intellectual property that we are trying to protect—I am not sure that that would come within the scope of this Bill—or even sell the intellectual property and license it back again. There are various other ways in which a company can raise finance, over and above equity, where there is a huge amount of influence or it falls outside the Bill. Clearly, crucial national infrastructure is a very different thing, but intellectual property is something that is very difficult to grab hold of; it is like trying to grasp a handful of sand. Given the objectives, I wonder how the Bill tackles those other areas, which seem to allow malign investors a way through.
Christian Boney: I think an important aspect of the Bill—this is one of the reasons why Lisa and I have described it as a broad regime—is that it does allow policing of the acquisition and control of assets, including intellectual property. In my experience, at least, that is quite different from what you see in other international regimes. Clearly, the acquisition of control of assets does not fall within the mandatory notification regime; nevertheless, it is helpful that the Government have the power potentially to exercise a voluntary call-in in respect of, for example, an acquisition or a licence of intellectual property.
Mark Garnier
Q
Christian Boney: That is certainly fair. I think the level of influence and control that a debt provider will typically get in what I will call the ordinary courts means that it is less likely—I am certainly not saying it is impossible—to be at the level of getting such granular, sensitive, let us call it operational information, which is the kind of thing we would really be concerned about. It would more be focused on getting access to financial projections, financial performance and that kind of information, which, although it can still be sensitive, is probably less sensitive than operational data. A balance needs to be struck, it seems to me, in the context of this legislation. Not having debt providers obviously within scope does limit the legislation, but does it strike an acceptable balance? My personal view is that, on balance, it probably does.
Nickie Aiken (Cities of London and Westminster) (Con)
Q
Lisa Wright: In many ways, the regime just brings the UK into line with major international peers. From that perspective, for people doing deals around the world who have already experienced those other regimes, it ought not to have any real negative impact at all, provided that BEIS can deliver on the aspiration set out of a slick and efficient regime, turning around notifications within sensible deal timeframes and providing the kind of informal advice and early engagement promised. That will be critical, particularly in the early stages of the regime. From that perspective, I do not think this should have a long-term negative impact on people wanting to do deals in the UK. As Christian was mentioning earlier, it may be a slightly different picture for the start-ups and the smaller companies where they are caught up in the mandatory sectors, but overall I think it is right that this can be viewed as the UK bringing itself into line with what else is going on around the world.
Christian Boney: I agree with that. That is the right assessment.
Sam Tarry (Ilford South) (Lab)
Q
Lisa Wright: It is certainly worth considering. I would imagine that those sorts of considerations will be going through the mind of the officials and the Secretary of State tasked with making these assessments and issuing the decisions. I can see there may be some sensitivities and a desire perhaps not to make that all transparent in terms of public documents. Perhaps they think they will deal with it over time through this engagement and, with advisers and parties coming to talk to them, you will get a sense of who is okay and who is not that. But I can see that perhaps they will not want to put that down in very great detail on a public piece of paper, not least because one might imagine it could change over time. I guess there needs to be a degree of flexibility to recognise that.
Christian Boney: I agree. I am certainly not a CFIUS expert, but my understanding of the exempt list of countries is that actually the practical impact is quite tightly drawn. I do agree with Lisa. I think we are likely to get the best sense of those countries that are viewed as more risky than others through the engagement process and as people’s experience of the regime develops.
The Chair
We are almost at the end of the time available for this session, so there will be no further questions for these witnesses, but thank you, Ms Wright and Mr Boney, for being so generous with your time and assisting the Committee so much. We will now move on to the next witness—either we will suspend the sitting briefly until everything is sorted out or we will move seamlessly on—but thank you both very much.
Examination of Witness
Professor Ciaran Martin gave evidence.
The Chair
Q
Professor Martin: Thank you. My name is Ciaran Martin. I am currently a professor of practice at the Blavatnik School of Government at the University of Oxford, but until August of this year I was the founding chief executive of the National Cyber Security Centre and a member of the executive board of GCHQ, within the Government. I should also declare for these purposes, although I am not sure it is relevant, that I serve on the advisory board of a US venture capital company called Paladin.
Chi Onwurah
Q
Professor Martin: Thank you for your comments, Ms Onwurah; it is nice to see you again. I speak as someone who thinks that the Government have broadly got this issue correct, in terms of their proposals in this Bill. That is not to underestimate the sheer complexity of dealing with the core, fundamental question that you rightly identify of balancing economic security and national security and of where one stops and the other begins. That is a very complicated and difficult thing to do. I think one starts with an attempt to define a core principle, which is essentially around the freedom to act. I think that if you look at something such as Arm—I would say this probably more in the case of Arm than DeepMind—and its potential ultimate sale to Nvidia, you see that the UK has less freedom of choice in a key strategic technology, which undermines its own ability.
I think there is an analogy with the little known but quite long-standing—for more than a century—work on sovereign cryptography. That is one of the areas that has long been covered by national sovereignty requirements. There are things in information security, as we used to call it, cyber-security, as we do call it, that have always needed to be fully sovereign, entirely British-made—they are not very many areas. The problem has been that as technology and communications have changed, it has been quite hard to keep up, and there are always pressures to expand that in a way that is economically harmful to competition and so on. So it needs a clever buyer within Government to identify what will be the strategic areas and what will not be.
In the area of sovereign cryptography, we end up trying to keep, depending on the era, around half a dozen or a dozen companies viable, because it is not a lucrative market. You can see the problem, but the key issue is whether there is enough, first, sovereign, but if not sovereign, friendly capability that allows us the freedom of choice to adopt key technologies. That means identifying the key technologies in the first place, evolving them over time and then having a very difficult to achieve but necessary intelligent function within Government that can evaluate the notifications that it gets. Of course, at the moment we do not have the power to do that, and that is what this Bill correctly seeks to remedy.
Chi Onwurah
Q
Moving on slightly, a comment made numerous times on Second Reading was about the role of the intelligence services. Indeed, my right hon. Friend the Member for North Durham (Mr Jones) asked for more intelligence in the process. How can the Bill better ensure that the intelligence services, including the National Cyber Security Centre, have input and scrutiny and, indeed, provide their expertise as part of the process so that the appropriate decisions are taken?
Professor Martin: I think the essential, principal requirement is not the intelligence services’ involvement—although that is important and I will come to that in a minute—but the understanding of technology and technological developments within Government. These are fundamentally economic issues as well. Apart from anything else, if you look at some of the reasons why the Bill has come about, you will see that, in strategically important technologies, the Government have invested heavily in university-sponsored research and in private sector research, only to see the fruits of that research sold off. Even if that did not impact on national security, which in most cases it does, it is not a good return for the taxpayer in terms of long-term UK involvement if the intellectual property ends up being monetised elsewhere.
I have enormous respect for Mr Jones and I think he is on to something in terms of involving the national security and intelligence services, but I do not think this should be intelligence-led. In my experience—obviously, I cannot go into detail on this particular aspect of it—secret intelligence adds relatively little to your knowledge of intent. If we take Russia and China, the two big strategic threats to the UK, Russia does not have a strategy in this space. We have to worry about Russia and cyber-security because it attacks us, but it attacks us on the internet that the west has built.
China is very different. China has a technological, strategic dominance aim, but it is not a secret. It is published and has been translated into English in the Made in China 2025 strategy, as you know. Our knowledge about the precise, intricate details of how that is implemented gains relatively little from secret intelligence.
What secret intelligence does have, particularly in GCHQ and the NCSC within it, is a knowledge of how technology works in terms of the national security threat space. I think the UK has a head start on other countries, because the National Security Council innovations of the 2010s gave the intelligence services a much bigger voice at the table, and that is reflected in the structures that we have now. The UK should be well placed to be able to listen to the intelligence services, but I would encourage—not least to make sure that in this very delicate balance of trying to show that we still have an open economy and are not shutting the doors to investment—as much transparency as possible on the decision taking. It will not always be possible because GCHQ technologists will know about things—exploitations of particular bits of technology—that they cannot reveal. They will be able to tell that to secret forums within Government for consideration—I am quite confident about that: there will be a seat at the table for them.
My recommendation would be that, as far as can safely be done, the Government should be relatively open about why they make the judgements they make about strategic areas of technology and the interventions they will make once this Bill is passed—assuming that both Houses wish to pass it.
Nadhim Zahawi
Q
Professor Martin: I suppose the mantra, if I had one, would be, “Broad powers, sparingly used, with accountability mechanisms”. It is incredibly hard to be specific about this, for two reasons: one is that new areas of technology crop up, as they invariably do, and the other is that sweeping categorisations are needed on the face of legislation.
I am not a deep technical expert—although others are available from my former organisation—but if you take sweeping, umbrella titles like “quantum” or “artificial intelligence”, there are huge swathes of that where, actually, not a lot of these powers in the Bill will be used. There will be companies that will be doing very interesting things—10 interesting things—of which only one would be caught by this Bill.
If you take areas like specialist quantum computing and so forth, I think the community of interest and expertise is actually relatively small and has relatively good relations with Government—not least because, again, while it is not perfect, the whole system of research council funding and Government investment in funding technological research is pretty good, by international standards—so you end up knowing these people. One of the reasons that this sort of policy evolution came about, which has led to the publication of the Bill before you—I remember this from discussions within Government—is that people were volunteering to come to us. World-leading experts, people who had been funded by the Government—I will not go into individual cases because it is commercially sensitive and possibly security sensitive—would come to Government and say, “Look, we’ve had this inquiry from a Chinese behemoth,” or even, “We’ve had this inquiry from a US company,” and so forth: “What do you guys think about this?” and, invariably, we would have to have an informal influencing discussion.
I do not think that some of the businesses to which this will apply will be screaming that this is horrible Government regulation and intervention in areas where that should not be made. There was already a dialogue; there was just no legislative framework. Of course, that meant that companies that felt a loyalty to the UK and so forth but that also had to look after their commercial interests were sometimes in a real bind.
To try to answer your question, I think that the powers should be fairly broad. I think there should be accountability and transparency mechanisms, so that there is assurance that they are being fairly and sparingly applied.
Stephen Kinnock
Q
Professor Martin: I think there are broadly two or three areas in which China is very interested in doing that. I can make some comments on motivations, because I think they are very important, and then I will finish with how that manifests itself in UK casework.
Clearly, China has set out a stall, which it published in Made in China 2025, in which it said it wants to be the world’s pre-eminent leader in a number of key areas of technology. It mentioned artificial intelligence and quantum, and it is throwing vast sums of state money and long-term strategies at them, unencumbered by the need to seek re-election and popular consent, so it is a very powerful movement. That is the first thing: it is trying to build up its capability.
China is also trying to change, at least for itself—we will come to that in a minute—the way the internet works. It was reported earlier this year that Huawei and other major companies in these international standards bodies are looking at something called new IP protocols, among many other things. To give you a sense of what the motivations behind that are, at the minute when traffic flows around the internet, despite some popular impressions to the contrary, it is actually pretty hard to work out what is going through it. Therefore, it is relatively difficult to censor, although China has managed it in some ways. The new IP protocol will make it much easier to work out what sort of traffic is going through and being rerouted, so it makes it much easier to control. China is trying to dominate and essentially get a lead in the strategic technology, and also to change the character and culture of the technological age from one that started off fairly anarchic to one that is much easier to control. That is what it is trying to do.
Why is China trying to do that? A lot of this is about the assertion of its own power for itself—the regime, power, Chinese nationalism and so forth. I think it does intend to extend its sphere of influence, but I have never seen that as the primary motivation. One of the interesting things, post the pushback from the Trump Administration and the US sanctions on Huawei, is the extent to which China will now accelerate its desire for self-sufficiency, and the extent to which that leads to a separate pole of technological influence that may become less interested in countries such as the UK, European Union countries and North America.
To date, how has that manifested itself in cases in the UK? Ms Onwurah has already mentioned the Huawei controversy. If you take Huawei as a company, I think it shows the different ways in which this can manifest. The Huawei 5G controversy is going to be dealt with by a Bill that I believe is coming to the House next week, not this one. The 5G controversy was not about investment; it was about selling to British companies to build stuff. Obviously, that case has been very heavily analysed.
I think that the more interesting case in the last 10 years involving Huawei was its acquisition in 2012 of the Centre for Integrated Photonics—a world-leading British firm in a really key area of technology. That, in my view, was pretty strategically damaging. If we had our time over again, that is the sort of thing that the Bill might well notify. I know you have taken evidence from the likes of Charles Parton and people with huge China expertise. The fact that the acquisition of the Centre for Integrated Photonics did down Britain’s technological development was probably a by-product. The point is that Huawei could buy world-leading research, which China could then take and appropriate for itself very cheaply. That is what it will continue to do to build up its own capabilities.
Stephen Kinnock
Q
Professor Martin: One of the reasons that this is so difficult, as I said in my first answer to Ms Onwurah, is that I can think of at least three areas of expertise that the unit is going to need to draw on. Technological, yes, because of what technologies will matter. Geopolitical, yes, and I do not have a strong view on whether it needs Mandarin speakers because the UK has a strong and intelligent foreign service mission in country in China and all over the place that can provide input. But the third thing is actually quite a lot of commercial nous—patent laws and so forth.
This is where there is a distinction. This is not all about China. It is layered, and there will be things that we would not want to see going even to quite friendly countries. Arm is a case in point, with the concentration of power in a couple of US companies—particularly when one of them is derived from UK technology. That is not comparable as a strategic threat to Chinese dominance—I hope the Committee does not think I am saying that—but there are times when it would be a damaging foreclosure, if you like, of UK freedom of action and freedom of choice. We know that the US has a strong and sometimes aggressively used extraterritorial legal system in which it can use the power of US companies and block trading with US companies and so on, so we need people who understand those areas where we think, “We are not sure we would want that to leave the country at all” as well as people who understand Chinese. That involves a lot of expertise in things like patents, international law, US commercial law, sanctions and so on.
Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
Q
Professor Martin: I do not vehemently disagree with that suggestion, but I am not persuaded by it. It is not a new issue. I remember cases—they have nothing to do with this—going back to the aftermath of the so-called global war on terror, with demands during inquiries for definitions of national security. I am not sure what that would achieve other than it would be heavily litigated. In terms of both definitions of national security and the categories of technology, a better answer is a drumbeat of reviewable activity, which is by definition transparent, about how the Government interpret the scope of the Bill, if it becomes an Act, and the sort of cases it applies to so that, over time, you build up a broadly accepted framework—of course, not everyone will accept it—that is seen to be fair and rational.
Peter Grant
Q
Professor Martin: I certainly would not be against things like that, if it could be done in a way that did not compromise the wider use of the Bill, because I do not think there is intent to interfere in the democratic process. I think the intelligence services take that pretty seriously. I remember in other contexts, when asked to co-operate on cyber-security with other countries, given that some cyber-security capabilities—by no means all—can be intrusive, that a lot of due diligence is always done on whether they could be turned by more authoritarian regimes against their own people. I would not object to that in principle. I do not know whether you have a case in mind when you say that might be necessary, but I have an open mind on that.
Peter Grant
Q
Professor Martin: In general terms—this is a personal view, for what it is worth—I do not think the location of most government functions matters a great deal. Perhaps I am just a bit of a contrarian on that point, and always have been. The Government is the Government. Institutions do have cultures. I do not know whether the Government or the intelligence services have offered a formal view, but personally I would be reluctant to put it within the national security estate, first, because it has to be economically literate, and secondly, because it has to justify its existence and use. A strong national security input is important, but I would not leave it in the national security community.
I am sorry to sound like a broken record on this point, but I think the more important force in function is some form of reviewable transparency requirement. If you set it up and let it go away, first, you take away pressure to perform well, and secondly, you take away pressure to justify the decisions that are made.
This is a really hard problem. When I was still in government and there were discussions around it, this was not the sort of Bill that most Ministers and politicians came into Government to want to pass. It is a necessity of a bunch of case work that we have become concerned about that has required us to do this. It is sort of the least bad option. The country wants to be open to investment—we are all mindful of the impression it may give that it is trying to deter investment—so it is probably the least bad option, as I say.
I do not think there is any arrogance in government or belief that a bunch of civil servants assembled in BEIS or another Department will make infallible judgments on individual cases, but what is the alternative way to stop the sort of things we have seen happening—world-class taxpayer-funded research in key strategic technologies that are going to be vital for national security being sold for a song to potentially hostile regimes?
Peter Grant
I will leave it there, Sir Graham. I may want to come back later, but I will let someone else in now.
Simon Baynes
Q
Professor Martin: I get that completely. I do not think 100% transparency will be possible in this case. Obviously, it will be judicially reviewable, but I am entirely unsurprised that there is an explicit provision for closed material procedures. It will be a minority, but there will be cases in which the reason why a particular aspect of a particular piece of technology is really sensitive—it will probably be highly specialised, and there might be a dozen people, of whom four serve in government, who actually understand why—cannot be published. Then, of course, there will be commercial sensitivities.
Having said all that, if you take, for example—these are real examples—the current debate around the potential use of offensive cyber, or the sort of allegations Edward Snowden made against Five Eyes countries in 2013, or some of the defences that the Government had to use in the 2000s about their role in the aftermath of 9/11 and Iraq and co-operating with US forces, in my view there is a clear distinction between being able to describe the operating environment and the sorts of thematic issues that you are dealing with, versus individual cases, which often contain extremely sensitive detail. National security organisations can say much more about the former than historically they have been willing to do.
In something like this, where we are talking about business confidence and how the country looks to potentially very friendly and helpful outside investors who like the UK, want to come here, want to put money here and like the high-quality research and the brilliant innovators and individuals, it should be possible to give them something that says, “In the course of the last year, we have looked at quantum resistant cryptography and here are the types of aspects of this that we are reserving and here are the bits that are more open” or that sort of thing, without disclosing anything sensitive. That is all you need to be able to say—these are the judgments. Let us say that the Bill becomes law in the middle of 2021, for sake of argument. By 2025 and the beginning of the next Parliament, the tech landscape will look very different. You will not want investors to be looking back at the debates you are having in the House now as a guide to the latest way in which the Government are applying this, or looking at drip feeds of information. You will want something official. It should be possible to do that.
Mark Garnier
Q
Professor Martin: I do not know the ECJU that well, but it is relevant. I remember, although it was some time ago, being asked for specific inputs into that sort of point. The important thing is that the unit achieves a prominence and reach across the Government, because bits of Government will have to be involved occasionally and there will be bits that will be embedded. It needs a home—in our system of government, every organisation needs a home with a responsible Minister and an accounting officer and all that. However, I do think this needs to be broadly based and multidisciplinary. Export controls are one of the few areas where we have had to do that consistently for a number of years, so I agree that it is well worth a look.
Mark Garnier
Q
Professor Martin: I think it should be formal. The Government are not new to this. There should be some sort of review board to make sure that it has the right resources, the right performance, the right skillset and so forth. I would encourage ministerial interest. It may be something that the National Security Council wants to periodically review. In my time in national security, there were standing issues that the Government would come back to twice a year, whether there was anything interesting happening on them or not, just to take stock. That might be an issue. In answer to the previous question about transparency, there may be a case for a formal presentation, secret detail and all, to the National Security Council every year, which would include all the potentially covert and sensitive stuff. It really needs to work with the grain of ministerial thinking as well. That will need to be done collectively, at some point, so there may be a role for the NSC.
Peter Grant
Q
Professor Martin: There is a reasonable case for a more frequently reviewable point. There is also a cultural point about the way in which the political processes work. There are aspects of government about which questions are not routinely asked in Parliament, because they seem to be too secret. Again, it is a point about casework versus framework.
To my mind, there is no reason why the Secretary of State for BEIS could not be asked from time to time to update on this or why questions in the House should not be asked. I do not think technology changes fast enough that the whole framework of categories of regulated activity and so forth have to be updated more than every five years, but there will be a possibility of more frequent updates on working, approving listings and that sort of thing.
Peter Grant
To be fair, there is nothing to stop MPs from asking questions about international security, but the chances of us ever getting an answer may be somewhat less.
Chi Onwurah
Q
Professor Martin: I am not sure if the Bill will get in the way or help, one way or the other. I think Government technological nous across the civil service needs to be invested in properly. There is a deep, fairly sizeable reservoir in GCHQ. Again, without going into too much detail, more and more people are being transferred and seconded from there into other areas. That is a good thing, and we should welcome that rather than cast aspersions on this being all secret state stuff. It should be permeating normal Government activity.
There will be issues about how to pay for some of the specialists that are needed. I do not think we will ever compete with the big tech companies, but there may be scope for paying some specialists a bit more and bringing them in here. There is something about creating a career path for technologists in Government. There are big issues for the heads of the civil service and the permanent secretaries. If I were heading it, I would want an immediate infusion of seconded talent and private sector buy-ins relatively quickly. Government can do that quite well some- times, and sometimes not so well. There also needs to be a long-term strategy for technologists in Government.
The Chair
I will now thank you very much, Professor Martin, for giving your time so generously and being of such assistance to the Committee. Given that the next witness is not due to give evidence until 2 pm, I invite the Government Whip to propose the adjournment.
Ordered, That further consideration be now adjourned. —(Michael Tomlinson.)
Environment Bill (Twenty Second sitting)
Thursday 26th November 2020
(4 years, 1 month ago)
Public Bill CommitteesRead Full debate Environment Act 2021 View all Environment Act 2021 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 26 November 2020 - (26 Nov 2020)
The Committee divided: - Ayes: 5 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 5 / Noes: 10 - Question accordingly negatived.
The Chair
Welcome to this penultimate, or possibly ultimate—we hope—sitting of the Committee. I think that everybody is observing social distancing today, but the Speaker has made it perfectly clear that we must be very strict about this. For this last—or second last—event, please try to remember that.
New Clause 23
Reduction of lead poisoning from shot
(1) The Wildlife and Countryside Act 1981 is amended in accordance with subsections (2) and (3).
(2) After section 5(c)(viii) insert—
“(ix) any form of lead ammunition used in a shotgun.”
(3) After section 11 (1)(d) insert—
“(e) uses lead ammunition in a shotgun for the purposes of killing or taking any wild animal”.
(4) The provisions in this section come into force on 1 January 2023.
This new clause intends to provide an effective regulation to protect wildlife, the environment and human health by replacing widely-used toxic lead gunshot with alternatives. It intends to ensure a supply of healthy game for the market, whilst meeting societal requirements and those of shooting, food retail and conservation stakeholders.—(Fleur Anderson.)
Brought up, and read the First time.
Fleur Anderson (Putney) (Lab)
I beg to move, That the clause be read a Second time.
It is an honour to stand in this last sitting of our Environment Bill Committee consideration, which began 261 days ago. I have been disappointed, so far, by the lack of agreement over the amendments proposed by Opposition Members.
I hope today will see a sea change; that this new clause is the one that we can all accept, agreeing that lead shot is highly toxic, should not be in our system, is bad for the environment, bad for wildlife, bad for children, bad for adults—bad for everyone. Its days can now be hastily numbered, and we can support the shooting community in their efforts to get rid of lead shot from our environment, our ecosystem and our agriculture.
Lead shot is highly toxic and is easily absorbed into the bloodstream. Birds eat it as they mistake it for grit—which they eat for digestion—and it then gets absorbed into their bodies. It is also highly toxic for children; there is no minimum amount of lead, in any system, that is safe for children.
I am no urban MP, standing up for a city constituency, with no idea of what goes on in the country, because I was raised in Wiltshire, where my father was a rural vicar. Every Christmas, some of our presents would not be wrapped up, but would be hung up outside our door, as they would be a brace of pheasants. I do understand what happens in the shooting community.
Bim Afolami (Hitchin and Harpenden) (Con)
Will the vicar’s daughter give way?
Bim Afolami
Could the hon. Lady outline the differential impacts of steel and lead shot, as that is something that many in the shooting community are interested in and will carefully consider?
Fleur Anderson
I thank the hon. Gentleman for that intervention, and for his interest in this subject, which I have become much more interested in since researching it and talking to relevant bodies.
Steel is considered to be safe, as are tungsten alloys and tin, so there are alternatives out there. There is obviously an issue with single-use plastics, which would currently have to be used with alternatives to lead. However, I believe that with the inspiration and impetus from this amendment, the whole shooting community—including manufacturers of alternatives to lead shot—would be encouraged to use and produce ammunition that was far, far safer than lead shot.
Lead does not need to be used; non-toxic ammunition is widely available, effective, and comparably priced. The hon. Member for Hitchin and Harpenden may be interested to know that Denmark and the Netherlands banned the use of all lead shot in the 1990s; they have proved that changing to safer ammunition is entirely possible.
Why do we need to do this new clause? We know that 8.7% of ducks and geese across Europe die every year from eating lead shot; this includes 23% of pochard, which is a species threatened with global extinction, and 31% of pintail ducks. Lead poisoning from ammunition kills an estimated 75,000 water birds each year, as well as other birds and mammals.
Through ingestion by cattle—which then results in food-safety issues as it enters their system—lead can end up in restaurants and retail outlets; in our food. It also seeps into land, including wetlands, and creates toxic grounds; wetlands have been found to be peppered with lead shot.
Lead is dangerous for people’s health, as lead shot often fragments and is ingested in game meat. Children and pregnant women are particularly at risk due to the negative impact of lead on the developing brain, which has led to Waitrose labelling its game meat products as not safe for pregnant women and children.
Lead is not something we should allow into our food system. Somewhere in the order of 10,000 children from the UK hunting community are estimated to be at risk of negative impacts on IQ due to household consumption of game meat. If the effects were immediate and something happened to us that caused an immediate breakdown of our health, we would have stopped this years ago, but because lead has a subtle effect on our health—on our brain development and IQ—it has been allowed to carry on for too long.
The new clause has not just been dreamed up in the past few months; it is the result of the Government engaging with this issue since 1991. There have been stakeholder groups, compliance studies, risk assessments and reviews, but the stars are now aligned. We cannot any longer say that the new clause is not needed. I know that the British Association for Shooting and Conservation is moving towards a ban on lead shot, which I welcome. It wants to take action within the next five years to see a change. There is clearly appetite in the shooting world to accomplish what is set out in the new clause by banning lead shot. However, things are not moving fast enough. We cannot entirely rely on that compliance, but the new clause would take us where the shooting community seems to want us to go.
The stars are aligned, and it is time for the new clause. There is a limited ban at the moment, focused on wetland birds, but it is widely flouted and there has been only one prosecution, which is another reason why we need to have the new clause in the legislation. The partial regulation focused on protecting wetland birds, and similar regulations in other home nations, have been ineffective in reducing lead poisoning in water birds because there has been a high level of non-compliance. Birds feeding in terrestrial habitats, where most of the lead shot is legally deposited, are also affected. Moreover, enforcement of the limited regulation has been negligible so far, and human and livestock health have not been protected. Two large-scale restriction proposals are currently being progressed in the EU under REACH, which will bring about a total ban and additional benefits to law enforcement. Let us pre-empt that and go one step further in the UK.
This is the right time for policy change. The coinciding of the new Environment Bill and proposed policy change on lead shot is opportune. The nine main UK shooting organisations recognise the risk from lead ammunition. There is no debate about that. The imminent impacts of regulation on lead ammunition in the EU, and the likely impacts on UK markets for game meat, all need to be considered. Hence, on 22 February, the move to a voluntary phase-out of lead shot within five years was announced. That has already prepared the UK’s shooting community for change, and I have seen that the media narratives around shooting have changed to reflect that.
To date, however, voluntary bans on lead shot have always failed, so to say that the new clause is unnecessary is just not good enough. Denmark, which has gone ahead of us on this issue—we can learn from them—banned all lead shot in 1996. Hunters accept that it was because a progressive Government took such a step that they now lead the world in the control of lead poisoning from shot.
Although there is a desire for change within hunting organisations, there also remains a tradition of resisting regulation, which might just roll on and on over the next five years.
Robbie Moore (Keighley) (Con)
I want to pick up on that point. It is not only BASC but the Moorland Association, the National Gamekeepers Organisation and the Country Land and Business Association that are behind the transition. They are actually going further than what the hon. Lady is asking for, by asking for a ban on single-use plastics in the cartridges, but what they are clearly asking for is a period of smooth transition over five years. Does the hon. Member not agree that that is more appropriate?
Fleur Anderson
I agree, and I thank the hon. Member for pointing out the wide support for a move in this direction, but if we can ensure it is in legislation, the move will go further, it will be deeper and it will be guaranteed to happen. Given the high toxicity of lead, we cannot just leave this issue to voluntary moves by all those organisations. Let us go with the flow and accept their willingness to change, but let us underpin that with legislative change, which moves it on faster. These issues have already been under negotiation. The smooth transition is happening. I am not asking for this to happen on 1 January—the proposal is to give another year. There is time to move forward; the new clause is very reasonable. If we want to go further and talk more about single-use plastics, that will happen in time, and this proposal will enable manufacturers to do that.
Only regulation will provide a guaranteed market for ammunition manufacturers. Moving all users of ammunition through these changes, all at once, will enable ammunition manufacturers to make the change that we all surely want to see, and will ensure the provision of game free from lead ammunition for the retail market. It will enable cost-effective enforcement and protect wildlife and human health much earlier than in five years. Why would we want lead shot in our food for another five years? Why would we want to kill all those birds for another five years?
Action on this issue was recommended in 1983 in the report of the Royal Commission on Environmental Pollution on lead in the environment. It has been long enough. It is long overdue. Now, at last, is the time to act.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)
I thank the hon. Member for Putney for the new clause and for highlighting her eating of pheasant as a child. I, too, have had many a pheasant hanging in my garage. Indeed, we had roast pheasant for lunch this Sunday. It was absolutely delicious, covered in bacon. It was really nice.
I reassure the hon. Lady that this Government support the principle of addressing the impacts of lead shot. Evidence published by the Wildfowl and Wetlands Trust suggests that, as she pointed out, tens of thousands of wildfowl die from lead poisoning each year and many more birds, including scavengers and predators such as raptors, suffer and die through secondary poisoning.
There is a lot of movement already going on in this space. In England, the use of lead shot is already prohibited over all foreshore, on sites of special scientific interest and for shooting certain waterfowl. I certainly know people in Somerset who give anyone all of the chat before they go out to shoot anywhere near wildfowl and local ponds about not using lead shot.
My hon. Friend the Member for Keighley has pointed out that the new clause falls short of what shooting organisations are calling for. Organisations such as BASC, the Moorland Association and various other countryside organisations—I engaged with a lot of them as a Back Bencher—are calling for an end within five years to both lead and single-use plastics. They are talking about it seriously. As the hon. Member for Putney will know, there is a lot of research going on as well.
An EU REACH regulation on the use of lead shot in or near wetlands is close to being adopted and a wider measure affecting all terrestrial areas is under consideration. The fact that the industry itself is calling for a ban within five years demonstrates the work going on in this space.
The wetlands measure will apply in Northern Ireland by virtue of the Northern Ireland protocol and will apply in the rest of the UK and be retained EU law after the transition period if the legislation providing for that comes into force before the end of this period.
The amendment seeks to prohibit use of lead shot in shotguns for the purposes of killing or taking any wild bird or wild animal. That approach may not be the most effective means of restricting the use of lead shot. It is also slightly unclear because it does not cover clay pigeon shooting, for example. If one were really going to address this issue, all aspects of the sport, as it might be termed, would need to be considered. The new clause does not address them all.
The police would enforce under the Wildlife and Countryside Act 1981, but as with other wildlife crimes, there are considerable difficulties in detection and taking enforcement action in remote locations. All those things would need ironing out; it is not just a straightforward, “Let’s have a ban tomorrow.”
Fleur Anderson
I thank the Minister, but it will not surprise her to hear that I will not be withdrawing the new clause. Assurances do not cut it on this issue; it is too important. I would also absolutely refute any feeling that this is not underpinned by evidence. As I have outlined, so much work by so many different groups has gone into this that it does need to go ahead.
If we need it to, the Office for Environmental Protection has all the powers to go further than my proposal to talk about clay pigeon use and single-use plastics. Let us take this further, absolutely, but accepting the new clause would be a much better assurance and indication of our intentions for what should happen in terms of getting rid of lead ammunition. Assurances and good words will be far less effective than putting this new clause in the Bill. The new clause goes further than voluntary regulations because it puts this firm date, 1 January 2023, in legislation. Those five-year assurances might go on and on; when is the actual end of that five years? The new clause ensures that action will happen, so we will be dividing the Committee.
Question put, That the clause be read a Second time.
The Chair
Before we proceed, may I advise the Committee that we are able to sit here until 5 pm on Tuesday, but I personally feel a strong urge to get back to Wiltshire as soon as I possibly can, and cracking on would therefore be a good plan.
New Clause 28
Environmental objective and commitments
‘(1) In interpreting and applying this Act, any party with duties, responsibilities, obligations or discretions under or relating to it must comply with—
(a) the environmental objective in subsection (2); and
(b) the commitments in subsection (3).
(2) The environmental objective is to achieve and maintain—
(a) a healthy, resilient and biodiverse natural environment;
(b) an environment that supports human health and well-being for everyone; and
(c) sustainable use of resources.
(3) The commitments are—
(a) all commitments given by Her Majesty’s Government in the United Nations Leaders’ Pledge for Nature of 28 September 2020, including, but not limited to, the urgent actions committed to be taken by it over the period of ten years from the date of that pledge;
(b) any enhanced commitments given by Her Majesty’s Government pursuant to that pledge, any other pledge, and any international agreement; and
(c) all relevant domestic legislation, including, but not limited to, the Climate Change Act 2008, as amended from time to time.
(4) Without prejudice to the generality of the requirement in subsection (1), that requirement applies to—
(a) the Secretary of State in setting, amending and ensuring compliance with the environmental targets; preparing, amending and implementing environmental improvement plans; and performing all their obligations and exercising all their discretions under this Act;
(b) the Office for Environmental Protection and the Upper Tribunal in performing their respective obligations and exercising any applicable discretions; and
(c) all other persons and bodies with obligations and discretions under, or in connection with, the subject matter of this Act.’ .—(Dr Whitehead.)
This new clause ties obligations and discretions of the various parties under this Act (subsections 2 and 3), other acts and international agreements together. It seeks to incorporate commitments as they are made in the future. It requires all relevant public bodies to apply the commitments as they are agreed to
Brought up, and read the First time.
Dr Alan Whitehead (Southampton, Test) (Lab)
I beg to move, That the clause be read a Second time.
Hon. Members with an elephantine memory will recall that at the beginning of this Committee’s deliberations—I have here the exact date and time a clause is debated; it is written on a piece of parchment, it is so old—we tabled new clause 1, which related to the environmental objective. At that time, we said that one reason for tabling this new clause was that the Bill had no cohesion in terms of its overall objectives. While it has many good things in it, those are essentially disparate elements that do not pull themselves together in terms of what the Bill is or should be about overall. We tabled that brief clause to try to pull the Bill together. The clause was not agreed to on that occasion, but as the Bill Committee has progressed and as we have moved into our latter stages in the autumn, nothing has made the Bill more cohesive.
New clause 28 would do exactly that, with environmental objectives and commitments. It would place in the Bill a very clear environmental objective to
“achieve and maintain…a healthy, resilient and biodiverse natural environment…an environment that supports human health and well-being for everyone; and…sustainable use of resources.
I think that would absolutely pull together what we all think we are doing in this Bill Committee. If passed, imagine the new clause placed at the head of the Bill, where it would underline those objectives and ensure that everything in the Bill was read within them.
The new clause goes further still by ensuring that the Bill takes account of
“all commitments given by Her Majesty’s Government in the United Nations Leaders’ Pledge for Nature of 28 September 2020”,
which reflects those environmental objectives. The legislation would include the international commitments that we as a country have made to our environmental objectives, underlining just how important the Bill may be for those objectives.
We are offering a much better and improved environmental objective clause that takes account of all the various issues raised in Committee, and we think it would be a great adornment to the Bill. I know that in this place we are all looking for “the one” when it comes to clauses, and I was grievously disappointed that the last clause did not make it into the Bill, because there was absolutely no reason at all why it should not have been adopted. I have a similar feeling about new clause 28. I hope that the Committee will unanimously agree that we need an environmental objective in the Bill. This clause fits the bill admirably and should be supported.
Rebecca Pow
The shadow Minister said that there is no cohesion to what the Bill is about. He spoke about people with elephantine memories, but surely he has not been listening? Throughout Committee stage, we have talked about what the Bill is about. I thank him for his sentiments, but I honestly think that he has missed the point somewhere along the line.
I reassure the Committee that we have designed each governance mechanism in part 1 of the Bill with guiding objectives. They will ensure that targets, environmental improvement plans, the environmental principles, which are included, and the Office for Environmental Protection work in harmony to protect and enhance our natural environment. That has all been devised as one framework. As is set out on the face of the Bill, the objective of the targets and environmental improvement plans is to deliver significant improvement and to provide certainty on the direction of travel. The first EIP is the 25-year environment plan, which the Opposition have waved at us many times.
The policy statement on the environment principles will be required to contribute to the improvement of environmental protection and sustainable development. Ministers of the Crown must have regard to that statement when making policy. Those aims will therefore be integral to policy making across Government. Furthermore, clause 22 sets a principal objective for the OEP of contributing to environmental protection and the improvement of the natural environmental in exercising its functions, so if the OEP does not think that enough is being done towards that objective, it can say why, give some steers and advice, and things will have to change. Those measures are all closely aligned and will work together to deliver the environmental objectives outlined in new clause 28 on the improvement and protection of the natural environment, and the sustainable use of resources—that is all very much a part of the measures.
The new clause would include commitments made under the voluntary leaders’ pledge for nature. I am very glad the hon. Gentleman mentioned that, because it was a big moment when our Prime Minister said that we support that pledge at the recent UN biodiversity summit at the UN General Assembly in September. The UK is now working with other key signatories to drive forward the 10 commitments in the pledge, including through our hosting of COP26 and our involvement in the convention on biological diversity negotiations in 2021. I reiterate that the leaders’ pledge for nature is voluntary and, as such, was drafted between the participating states in deliberately non-treaty language, partly to serve as a public document that could be read by as many constituents as possible. The UK is now working with other key signatory countries to drive forward those commitments.
Many of the areas reflected in the leaders’ pledge are already included in the Bill, which introduces a powerful package of new policies and tools to support nature’s recovery. I know that the shadow Minister wants that just as much as I do, but I assure him that the measures in the Bill already cover that, not least on biodiversity net gain, local nature recovery strategies, conservation covenants, which he did welcome, and a strengthened biodiversity duty on public authorities. All those things will work together to drive from the roots upwards to get overall improvement. As a result, we will be creating or restoring rich habitats to enable wildlife to recover and thrive in future years. Measures on resource efficiency will help to keep products in use for longer, encouraging better repair and recycling of materials by influencing product design at the very beginning.
Clause 2 places a clear, legally binding requirement on the Government to set an air quality target that goes beyond EU requirements and delivers significant health benefits for citizens. The Bill also supports recent legislation on reaching net zero emissions by 2050 and our wider efforts to build resilience to a changing climate. It will do so by improving air and water quality, supporting resource efficiency, and restoring habitats to allow plants and wildlife to thrive, along with other measures in that part of the Bill.
I hope that I have made it clear that I honestly do not believe that new clause 28 is needed. I ask the hon. Gentleman to withdraw it.
Dr Whitehead
Although the Minister has provided a good concordance on where to look in the Bill for things that could conceivably pull it together, nothing in the Bill actually does that. Saying that if one looks at the Bill carefully, one can see things that move it in the right direction, is not really a defence.
Rebecca Pow
The shadow Minister’s new clause refers to a “healthy, resilient” environment—that is such a loose term. What exactly does he mean by that and what does it mean legally? Does he not agree that, were that wording to be used, it would create huge legal risk and could jeopardise the delivery of key policies in the Bill?
Dr Whitehead
I do not think a healthy and resilient environment can be interpreted in any other way than an environment that needs to be as healthy as possible for human development and progress, and one that is able to regenerate itself and keep as close as possible to the most beneficial way of working that it had prior to human intervention. I do not think there is a problem about the definition. Indeed, having it defined in that brief, particular way gives a very good remit for making sure that those are the ways in which that environment can be defined.
The Chair
Just to give the batting averages, we have taken half an hour for two new clauses. At this rate, we will be here until 4.30 pm this afternoon. Speed is of the essence.
New Clause 29
Report on climate and ecology
“(1) The Secretary of State must, no later than six months after the day of which this Act is passed, lay before Parliament a report containing an assessment of the adequacy of environmental legislation and policy for meeting the climate and ecology challenges faced by the United Kingdom and the world.
(2) That report must include specific assessments relating to—
(a) water quality, availability and abundance;
(b) biodiversity, including, but not limited to, the restoration and regeneration of biodiverse habitats, natural and human modified ecosystems, and their respective soils;
(c) the expansion and enhancement of natural ecosystems and agroecosystems to safeguard their carbon-sink capacity and resilience to global heating; and
(d) resource efficiency, waste reduction and the promotion of the circular economy.”—(Daniel Zeichner.)
This new clause requires the Secretary of State to go beyond setting one target (as in Section 1(2)) to within 6 months, assess, develop plans and outline adequacy of each target. “Circular Economy” is included as the Prime Minister agreed this concept in September 2020 at UN Leaders Pledge for Nature
Brought up, and read the First time.
Daniel Zeichner (Cambridge) (Lab)
I beg to move, That the clause be read a Second time.
I am grateful to the Minister for writing to me yet again. We are such regular correspondents that I am half expecting a Christmas card any time soon. She wrote on the debate we had on new clauses 25 and 27. It is a very detailed reply and it does give some reassurance, but I have to say that it shows why we should have had a discussion about those clauses in an evidence session, rather than have them inserted late in the day. I suspect there will be other lawyers who will take a different view on some of these matters, but I am sure that can be pursued as we go through the later stages of the Bill.
On new clause 29, I very much echo the comments of my hon. Friend the Member for Southampton, Test. We believe that new clauses 29 and 28 together would strengthen the Bill. New clause 29 would give additional bite; it can stand on its own, so there is still time for the Minister to redeem herself. Exactly as my hon. Friend said, we take issue with the lack of overall clarity in the Bill. It needs a clearer thread running through.
The new clause, which would require the Secretary of State within six months of the Bill becoming law to report on the adequacy of current environmental law and policy in meeting the climate and ecological challenges the UK faces, would be tremendously helpful, not least because—as we saw yesterday—it seems the Government do one thing one day, and completely different things another day. They fail to face the challenges when they make big policy announcements. The new clause would make it much tougher for the Government to crawl out of their obligations.
We think the report should specifically be required to address issues of water, biodiversity, the capacity of natural and agroecosystems to mitigate global warming, resource efficiency, waste reduction and the promotion of the circular economy. That should be helpful to Government. As my hon. Friend said, we support the Prime Minister’s signing up to the UN leaders’ pledge for nature, and this includes the circular economy in our thinking.
We have taken a number of these ideas from the climate and ecological emergency Bill, which we believe is right to place emphasis on the importance of expanding and enhancing natural ecosystems and agroecosystems to safeguard their capacity as carbon sinks, as well as on the need to restore biodiverse habits and their soils. Out there in the world, which is sadly not following proceedings on the Bill as closely as some of us would hope, there is an appetite for this more ambitious approach.
After the Secretary of State has made the report, we would then very much hope that he or she would act on it and ensure that the environmental targets and environmental improvement plans were appropriately ambitious and would set out not just one long-term target in each area as required in clause 1, but set and outline the adequacy of those targets and lay out adequate plans to address each of those major issues within six months.
If it is an emergency, it needs addressing urgently. We do not believe the Bill does that at the moment. New clause 29 would help.
Deidre Brock (Edinburgh North and Leith) (SNP)
Much of the Bill is concerned with English-only environmental issues, as I have mentioned in the past, because environment is a devolved area under the Scotland Act 1998 and legislative consent motions have been agreed.
In connection to new clauses 29 and 29, I point out for those who are keen to hear what is happening in Scotland that the Scottish Government are developing their own environmental strategy. “The Environmental Strategy for Scotland: vision and outcomes” was published earlier this year. As the Cabinet Secretary for Environment, Climate Change and Land Reform indicated just yesterday at her appearance in front of the Environment, Climate Change and Land Reform Committee, she will soon be publishing a monitoring framework for the strategy, which will bring together existing statutory targets, elements of the national performance framework and indicators from other strategies. That is after considerable consultation with stakeholders.
The strategy has attracted a broad range of cross-party support. The Cabinet Secretary just yesterday suggested working with Opposition Members to design amendments that will set out an obligation on Ministers to continue the work on an environmental strategy. It is an example of cross-party working that I think this place would do rather well to emulate. The Scottish Government and Parliament are leading the way in many environmental areas. I encourage Members from this place to lift their eyes from here and look to some of the great progress in this area that is being made in the devolved nations of the UK. I think it really would be worth their while.
Rebecca Pow
I thank the hon. Member for Cambridge for moving this new clause. He is always very passionate about what he says. I am pleased that my letter was able to give a bit of clarity on the subjects he raised in the Committee.
I reassure the Committee that the new clause is not needed. It will not surprise anyone to hear me say that. There are already measures in the Bill to help assess the adequacy of environmental legislation. Under clause 26, the OEP will proactively assess how our environmental laws work in practice and advise the Government on the most effective and efficient way of implementing those laws.
The OEP’s reports must be published and laid before Parliament and the Government are required to respond to the OEP and publish that response, which must also be laid before Parliament. Given that climate and ecology challenges are key environmental issues affecting us, we would expect that the OEP would want to address such matters in its clause 26 reports. That is basically its raison d’être and the raison d’être of the Bill. I do not think the hon. Gentleman is seeing what is in there, which covers what he is asking for. We also report annually on our progress in improving the environment through the 25-year environment plan.
The Bill as drafted already introduces a number of reporting requirements in the areas specified. Clause 94, for example, requires designated public authorities, including local planning authorities, to produce five-yearly biodiversity reports. The reports will provide transparency and accountability, and help local authorities to share best practice. Over time, they will become a very valuable source of data to support nature’s recovery. Clause 75 concerns improving water companies’ water resources management plans. This planning occurs every five years, taking into account the next 25-year period. Companies must review their plans annually.
The reporting requirements introduced by the Bill will complement the Government’s existing and proposed reporting and monitoring of the natural environment. There is only so much reporting people can cope with. I honestly think more reporting would cause people to groan under the weight of it all. What we want is action, and that is what this Bill is going to set in motion, which is why we need to get through it.
Last month, the Government published their response to the 2020 recommendations from the Committee on Climate Change. The response sets out the Government’s intention to publish a comprehensive net zero strategy in the lead up to COP26. The strategy will set out the Government’s vision for transitioning to net zero and reducing emissions across the economy. We have already set out our plans for a nationwide natural capital and ecosystem assessment. That is a big data-gathering census and a new large-scale surveying initiative, which will provide us with the all-important data to drive better decision making. That is something I have absolutely wished for as the Minister, as has the whole Department. It will be crucial in our future—we have talked about data before, and it is absolutely essential to know what we have now, what we will have tomorrow and what we would potentially like in the future.
I thank the hon. Member for Edinburgh North and Leith for her comments. We obviously work closely with the devolved Administrations, and we will be sharing a lot of the measures in the Bill. We always like to learn best practice from others—I mentioned that in the main Chamber only this morning, when the hon. Member for Putney and I spoke about air quality.
Although I welcome the intent behind the proposed new clause, I do not believe it is necessary, for the reasons I have outlined. Wide-ranging reporting assessment measures are already in place in the Bill and will be able to drive the sort of action that I think the hon. Member for Cambridge is after. I honestly do not believe we need the new clause, so I ask him to withdraw it.
Daniel Zeichner
I am grateful, as ever, but disappointed by the Minister’s response. I do not think we need to divide the Committee, but I doubt whether even the Office for Environmental Protection will be established in the next months. Let us hope that it will go more quickly. I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 30
Smoking related waste
“(1) The Secretary of State will by regulations introduce a producer responsibility scheme in England to tackle smoking related waste.
(2) The scheme will compel those tobacco companies operating in England, as defined in the regulations and subject to annual review, to provide financial support to the scheme based on a market share basis.
(3) The scheme will ensure that those tobacco companies will have no operational or other involvement in the scheme other than to provide financial support in accordance with guidance from the World Health Organisation Framework Convention on Tobacco Control and the Department of Health and Social Care.
(4) The regulations will set a target for a reduction in smoking related waste by 2030.
(5) The regulations will set out an appropriate vehicle to deliver the scheme including governance and criteria for funding related initiatives.
(6) The Secretary of State must prepare and publish an annual report of the scheme and must lay a copy of the report before Parliament.”—(Ruth Jones.)
The aim of this new clause is to ensure that the Government creates a producer responsibility scheme for smoking related waste. No such scheme exists at present and the clear up and waste reduction of cigarette butts are not covered by other Directives.
Brought up, and read the First time.
Ruth Jones (Newport West) (Lab)
I beg to move, That the clause be read a Second time.
The new clause is really quite clear, and I suspect that colleagues on both sides of the Committee know what is coming, but I want to speak to it for a moment. It is designed to ensure that the Government create a producer responsibility scheme for smoking-related waste. No such scheme exists at present, and the clear-up and waste reduction of cigarette butts are not covered by other directives.
I remind colleagues that it was this Government who clarified, back in February 2020, that tobacco packaging is covered by the current producer responsibility regulations, which require companies to recycle a proportion of the packaging waste that they place on the market. In their resources and waste strategy, the Government committed to look into and consult on the extended producer responsibility, or EPR, for five new waste streams by 2025, as well as to consult on two of them by 2022. The five priority waste streams are: textiles, fishing gear, certain products in construction and demolition, bulky waste, and vehicle tyres—the Minister has already alluded to that several times during our debates. They are important areas for the challenges facing us as we look to tackle the climate emergency.
The producer responsibility powers in the Bill enable the Government to set up an EPR scheme for cigarette litter. I urge the Minister to do so, and I look forward to a positive response from her on that specific point. I am concerned that, up until now, Ministers have not identified cigarette litter as a priority area for EPR, so I would like some further clarity on the detail and the likely timescale for any progress. I am sure that the Committee does not need to be reminded—I will do so anyway—that cigarette butts are estimated to account for 5% of ocean plastic, which is a big deal. We need to act, and we need to act now.
I hope the Minister will take the opportunity to set out a clear action plan and timetable when addressing the issues raised by the new clause. There is a crossover with the other responsibilities that we have as parliamentarians and lawmakers, because it is clear that smoking has a public health impact. Having been an NHS physiotherapist for more than 30 years before being elected to this place, I know a fair bit about the lungs and the danger that smoking causes. New clause 30 will help the wider battle against smoking and help promote a healthier world for all of us. As such, and with the determination needed to tackle the climate emergency, I wish to divide the Committee.
Rebecca Pow
I thank the hon. Member for Newport West for her contribution. It is always good to hear about people’s backgrounds, and her medical knowledge is obviously very useful.
Smoking-related litter is a particularly persistent and widespread problem. In the 2017 litter strategy, we explained that the most effective way to tackle smoking-related litter is obviously by reducing the prevalence of smoking in the first place. Given the hon. Member’s background in health, I am sure she would agree with that. Smoking rates in England are currently at their lowest recorded level, and our ambition is for a smoke-free Britain by 2030. In the meantime, I have made it clear that the lack of serious investment by the industry to clear up the mess caused by its products cannot continue.
In September, I held a roundtable with the tobacco industry and other stakeholders. I got a key group together, and I was pleased that we were able to get them to come to the table. We understand that Keep Britain Tidy is working with the tobacco industry to develop a non-regulatory producer responsibility scheme, and we are watching very closely, because it could provide a rapid means of securing significant investment from the industry to tackle the litter created by its products, rather than having to take legislative action.
Ruth Jones
In a cyclical system, if we have less going in at the beginning, we have less waste coming out at the end, which is what we all want. As such, it is good to note that smoking is decreasing. That is a really important public health initiative, and it must continue. I am pleased to hear that the Minister held a roundtable with the tobacco companies and that she found it useful, but we want to put the onus on the manufacturers by introducing this producer responsibility scheme, which is why we think it is important to include it in the Bill. It is good to hear that the Minister is keen to do this in future, and that future options would be open, but why not have it in the Bill now? That is why we will divide the Committee.
Question put, That the clause be read a Second time.
Daniel Zeichner
I beg to move, That the clause be read a Second time.
The new clause seeks to address a glaring problem with the current biodiversity net gain provisions, which we discussed earlier in the proceedings. Currently, the Bill does not extend the requirement for biodiversity net gain to major infrastructure developments delivered through the nationally significant infrastructure projects regime. We fear that that exemption will result in habitat loss on a large scale due to the size of those major infrastructure developments and could potentially lead to the destruction of irreplaceable habitats, increased fragmentation of remaining habitats and the local extinction of endangered species.
We have a very controversial example at the moment in High Speed 2—a major infrastructure project that does not have biodiversity net gain and that has put at risk 108 ancient woodland sites, 33 sites of scientific interest and 693 local wildlife sites. I appreciate that HS2 was not delivered through the NSIP regime, but it is comparable with future major infrastructure projects that would be delivered in that way. It is disappointing that HS2 has not gone with the trend of recent times and moved away and gone beyond no net loss, despite frequent calls for it to do so. Will the Minister comment on why no net gain is necessary in her view?
In their response to the net gain consultation, in which the Government outlined their intention that nationally significant infrastructure would not be subject to the requirement, despite the fact that there was considerable support from many respondents, the Government said that they will
“continue to work on exploring potential net gain approaches for these types of developments”.
What alternative net gain approaches have been considered for NSIPs? I understand that the Government have commissioned a study into the costs and benefits of bringing the large infrastructure projects into the scope of mandatory biodiversity net gain. What are the findings from that study, and is the Minister able to share them with the Committee?
I have one final plea for the Minister to find redemption in this whole process. As I have said many times—she has quoted it many times—we started with the 25-year environment plan, but we now find ourselves with the “Planning for the future” planning White Paper. Will she write to me on this issue—another item in our endless list of correspondence—and explain how the planning White Paper proposals will impact on net gain? This is one last chance for redemption. I live in hope.
Rebecca Pow
I thank the hon. Member for Cambridge for his tempting words and for the new clause, which would extend the biodiversity net gain objective and the biodiversity gain plan requirement to include nationally significant infrastructure projects.
I recognise the good intentions behind wanting to apply the mandatory biodiversity net gain objective to such projects. The Government are clear in the 25-year environment plan that our commitment to seeking to embed a principle of environmental net gain for development applies to infrastructure as well as housing. In line with that commitment, we are exploring how a biodiversity net gain approach for major infrastructure projects could best be delivered and how policy or legislation could be used to support that.
There are a number of ways in which a form of the biodiversity net gain requirement could be implemented for nationally significant infrastructure projects, but it is very important, as I am sure the hon. Member will appreciate, to take the time to work with stakeholders to develop an appropriate approach. Many stakeholders are really keen to discuss the matter.
Introducing a new legal requirement for such projects now could lead to significant delay and increased costs for projects in the pipeline, hampering our ability to build back better in future generations. I am sure the hon. Member appreciates the need to get lots of the projects going, not least because of the link with jobs and levelling up across the nation. Risks of delays and costs to major infrastructure for a premature and inappropriate mandatory requirement could result in delays to the delivery of environmentally beneficial projects, such as those living renewable energy generation and waste facilities.
The hon. Member is trying to draw me on the planning White Paper. All I will say is that the Department for Environment, Food and Rural Affairs is working very closely with the Ministry of Housing, Communities and Local Government. We are at absolute pains to work with that Department, but also to ensure that the environmental protections remain there. It is going to be a green future, as the Prime Minister himself has said many times—in fact, I heard him say it again yesterday—so I can give assurances on that.
Nationally significant infrastructure projects are often distinct from other types of development in terms of scale and complexity. They have to be planned for over a number of years, as the hon. Gentleman knows, and many are in that design pipeline. We need to be very careful about doing what he is asking for now.
It is therefore important that any strengthening of biodiversity net gain requirements for the nationally significant infrastructure projects regime is done at the right time and in the right way, particularly if any mandatory net gain requirement is introduced. We do not want to be limited to the proposed approach to Town and Country Planning Act 1990 development when considering how to introduce any objective to other classes of development. As I have said, there are a number of ways in which biodiversity net gain for those big projects could be implemented through legislation or policy in future, for example through the national policy statement, sponsor-driven objectives or changes to planning legislation.
As I have said, the Government have set out a clear ambition to deliver infrastructure, but greener and faster. I support the intention behind the proposed new clause, but to ensure that we consider the best way to introduce any requirement for biodiversity net gain for major infrastructure, we need to consult on further details, which we will in due course. It is really important that we take that time to get this right. I would like to think that the hon. Gentleman will agree on that and will withdraw his new clause. I hope that we can continue to engage constructively on this issue when we do formally consult.
Daniel Zeichner
I admire the Minister’s relentless optimism, which she has managed to maintain throughout the Committee’s proceedings, and I congratulate her on that. I almost misheard her at one point: when she said that DEFRA had been “at absolute pains” with MHCLG, I thought she said that they “are absolute pains”. There may be some truth in that.
I am not surprised to hear that, yet again, the Minister is unable to support our new clause, but we will not divide the Committee. I will just say finally that the Minister’s jacket is enough to brighten any dull winter day, and I thank her for her optimism. I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
Dr Whitehead
Mr Gray, we consider that the aims of new clause 33 have already been aired in new clause 29—we know the result of that—so we do not wish to move it.
New Clause 34
Reducing Water Demand
“(1) The Secretary of State shall within 12 months of the commencement of this Act amend the Building Regulations 2010 Part G to—
(a) require all fittings to meet specified water efficiency requirements; and
(b) introduce mandatory minimum standards on water efficiency.
(2) Standards as introduced under subsection (1)(b) shall be reviewed every 5 years to assess their contribution to meeting government objectives for reducing water demand.”—(Ruth Jones.)
Brought up, and read the First time.
Ruth Jones
I beg to move, That the clause be read a Second time.
New clause 34 was tabled in my name and in those of my hon. Friends the Members for Southampton, Test, for Cambridge, for Putney, and for Sheffield, Brightside and Hillsborough. We are seeking to ensure that we build on the Minister’s words and give real effect to the long-term sustainable change that the climate emergency demands.
The new clause is clear in tone and intent. Although we are an island, safe and secure water supplies have eluded us in the past, and with a rising population and increased demand, the existing infrastructure, on which we have relied for many years, needs to be supported. It needs the pressure taken off, which is what the new clause would do.
In preparing to speak to new clause 34, I read Ofwat’s recent report exploring the decisions that can be taken, the options available, and the action required to reduce demand for water in coming years. The report notes that
“on average we currently use about 140 litres of water per person per day in England and Wales, up from 85 litres per person in the 1960s.”
The report’s findings also reveal that
“tackling household leaks and using innovative technologies could help to decrease water use by two thirds—or over one bath per person per day—over the next 50 years.”
The new clause therefore goes some way to giving parliamentary and legal effect to addressing many concerns related to tackling water waste up and down England.
The preservation of our environment is ultimately in our hands and those of the people we represent: working people in all parts of the United Kingdom. We need to ensure that the law in shaped in such a way that we motivate and encourage people to change their behaviour and to adapt to the changing and evolving demands of the climate emergency. The Bill will go some way towards ensuring that we reach out and give the people of England the necessary direction, whether that is through the introduction of mandatory minimum standards subject to a five-yearly review or a set of fittings requirements. If we do not act now—there is no reason for us not to seize this initiative—we cannot expect people in the country to act.
This is a once-in-a-generation Bill, as the Minister said on Second Reading and previously in Committee. Let us ensure that those words mean something. Let us deliver a Bill that is fit for purpose, and that will stand the test of time and the scrutiny of future generations. With the future of our planet in mind, I move the new clause.
Rebecca Pow
I thank the hon. Member for tabling the new clause. I have met a range of bodies to talk about water efficiency, including the Bathroom Manufacturers Association, and there is no end of things to learn about loos, flushes and showers—it is genuinely very interesting. I now read the riot act to my kids when they have showers that are far too long.
I understand the hon. Member’s intention of improving water efficiency in our homes. We agree that more needs to be done to improve the management of our water resources, but I can reassure her that, with the Ministry of Housing, Communities and Local Government and the Department for Business, Energy and Industrial Strategy, we are already investigating how the building regulations could best promote water efficiency through the introduction of mandatory water efficiency labelling for water-using products. We consulted on those measures in 2019, and we will be able to use clause 49 of and schedule 6 to the Bill, and existing powers under the Building Act 1984, to make the changes required. We expect to publish a Government response to the consultation in spring 2021, which is fast approaching, and that will set out our policy on water efficiency and, specifically, whether changes to the building regulations are required.
The new clause would introduce mandatory minimum standards for water efficiency in the building regulations. However, I hope that the hon. Member notes that the regulations already set minimum water efficiency standards for new homes. She is right about the amounts: we use 145 litres a day. We actually aim to get that down to 110 litres a day. Improving labelling and consumer information about the amount of water that gadgets use will be part and parcel of the new water efficiency world.
Let me add that under section 81 of the Water Act 2003, there is already a duty on the Secretary of State to report every three years on the steps that he has taken to encourage water conservation. That report must be laid before Parliament. The last report was published in December 2018, so I suggest that there is no need for a similar review requirement.
I hope that I have covered all the points that will reassure the hon. Member that she does not need to press the new clause, and that she might kindly withdraw it.
Ruth Jones
It is good to hear about the Minister’s new knowledge of bathroom fittings; I must admit that we have all learned a lot about them. I remember, even as a student, putting a brick in our cistern to save water, which was a great thing—and obviously a good use of household bricks. I think we all agree that more absolutely needs to be done, and while I take her point about new homes being covered by regulations, we need to deal with existing homes. Let us be honest: there are far more existing homes that need encouragement and help to do the right thing. We also need to ensure that people are aware of their water usage, because if they do not know how much water they are using, they cannot do anything to conserve it. It would be good to marry up the various sound water conservation measures in other legislation by incorporating them all in the new clause. It is a shame that she has not accepted—
Rebecca Pow
I just want to make a quick correction. I mentioned a figure of 110 litres. Does the hon. Member agree that, while the efficiency requirement for a new build will be 125 litres per person per day, it could be the 110 litre figure that I mentioned if that is imposed by a local authority when granting planning permission? Does she welcome that?
Ruth Jones
I do welcome it, but I am a bit lukewarm. I would sooner it was down to the original rate in the 1960s of 85 litres per person, which would be far more helpful in moving forward on the climate change emergency. I am disappointed that the Minister has not taken the new clause on board, but I will not seek to divide the Committee on it, so I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 35
Clean Air Duty
‘(1) The Secretary of State must prepare and publish an annual policy statement setting out how the Government is working to improve air quality, and must lay a copy of the report before Parliament.
(2) The annual policy statement in subsection (1) must include—
(a) how public authorities are improving air quality, including indoor air quality; and
(b) how Government departments are working together to improve air quality, including indoor air quality.
(3) A Minister of the Crown must, not later than three months after the report has been laid before Parliament, make a motion in the House of Commons in relation to the report.’—(Fleur Anderson.)
This new clause requires the Secretary of State to publish an annual report on air quality which includes indoor air quality and the work of public authorities and Government departments working together to improve it.
Brought up, and read the First time.
Fleur Anderson
I beg to move, That the clause be read a Second time.
This is the final new clause. It is only right and proper that, as we come towards the end of the Committee’s scrutiny of the Bill, after considering more than 230 amendments and 35 new clauses, we end with something that we can all agree on.
This new clause is all about working together. It has been tabled by the all-party parliamentary group on air pollution. It asks Government Departments to work together and for reports on how the Government are working with local authorities to achieve something very ambitious—tackling our air quality. It has cross-party support from hon. Members including the chair of the APPG, my hon. Friend the Member for Swansea West (Geraint Davies), and 23 other MPs.
The new clause is intended to help the Minister to get to that holy grail of action—cross-departmental working—and to achieve cross-government support for action to tackle air pollution, specifically indoor air pollution. Given that the public health crisis results in 40,000 deaths a year and costs £20 billion, urgent action is needed by the Department for Transport and many others across Government. The new clause would help with that.
The new clause is an important addition to the parts of the Bill on air quality, in particular schedule 11. The Minister may say that that is sufficient, but I would argue that it is not. Schedule 11 amends the Environment Act 1995 and gives the Secretary of State the duty to report on the
“assessment of the progress made in meeting air quality objectives, and air quality standards, in relation to England, and…the steps the Secretary of State has taken in that year in support of the meeting of those objectives and standards.”
Those reports and that action are very welcome, but the new clause takes them further. It would be in the Bill itself, rather than an amendment to another Act, and has additional reporting requirements that would do more to ensure that there was more focus on achieving our air quality targets and more joined-up working in Government.
Hon. Members will have read an email sent to us all in which Professor Sir Stephen Holgate, the Royal College of Physicians’ adviser on air quality and the UK Research and Innovation clean air champion, supports the new clause. I know that it is important to the Minister to be science-led. He said:
“I strongly support the need for placing greater transparent responsibility on public bodies, both central and local, to say what steps they are taking to improve air quality, both outside and inside buildings including houses, workplaces and schools. Since most people spend over 80% of their time indoors, the indoor air is a particular concern especially since all the emphasis is on conserving energy by “sealing” buildings with little regard to ensuring that ventilation is adequate. …unless attention is focused on the ever-increasing chemical contaminants that will accumulate, without adequate ventilation, the public will suffer adverse health effects. This is especially so in periods of “lock-down” during the coronavirus pandemic and the attention needed to be given to this is in the building of new homes. Special attention must be given to vulnerable groups such as pregnant women, children, older people and those with chronic disease.”
Many other scientists back up those findings.
We all know that air pollution is a public health crisis, as acknowledged by the joint report of the Environment, Food and Rural Affairs Committee, the Environmental Audit Committee, the Health and Social Care Committee and the Transport Committee last year. There was joint working there, which we can encourage with the joint working on the reports that the new clause would make a legislative commitment.
A report by King’s College Hospital last year showed that cutting air pollution by a fifth would reduce the number of lung cancer cases by 7.6% in London, 6.4% in Birmingham, 5.9% in Bristol, 5.3% in Liverpool, 5.6% in Manchester, 6.7% in Nottingham, 6% in Oxford and 5.9% in Southampton. I read those figures out to show the local impact that air pollution is having on a considerable number of people’s lives; we know that it needs local action. The new clause would ensure that we find out what that local action is and whether it is good enough.
Living near a busy road can trigger bronchitic symptoms among children with asthma. If pollution were to be reduced by one fifth, there would be 3,865 fewer cases of children with bronchitic symptoms every year in London. In my own constituency, I would see the difference that that would make. The Government have made considerable funding available to local authorities, so local authorities should report back on what the funding has achieved.
We now know that there is a more urgent reason for the new clause, which would strengthen the Bill. There is a direct link between coronavirus deaths and air pollution. Harvard says there is an 8% risk, whereas the Max Planck Institute says it is 14%, for each additional microgram per cubic metre of PM2.5, the smaller particulates. There is a direct link between air quality and coronavirus deaths, and the new clause would make taking urgent action compulsory. It is no surprise that there is a link, because air pollution weakens lungs, hearts and brains, which covid also affects. We need a joined-up approach, with cleaner transport and ventilated schools. It is about education, health, better building regulations from MHCLG, better planning and knowing the effects of more home working with digital infrastructure.
The new clause would encourage a fiscal strategy that helps to drive a holistic vision of a cleaner, healthier and more productive future for all. Put simply, we need to have a joined-up approach to have the best effect, and the new clause would help to ensure that is done by asking for joined-up reporting. No matter what is already in the Bill, it just does not go far enough. The new clause is needed.
The new clause does not have specific targets and action plans that can be rejected by the Conservative party. In fact, they are for the Office for Environmental Protection, which was mentioned in many earlier debates, to decide. However, this would be a wonderful model for the UK to showcase at COP26 next year, and for other Governments to adopt. There is no doubt that there might be a silo mentality in DEFRA that says, “We can’t ask other Departments to do things,” but air pollution is an NHS public health issue of massive proportions, and it cannot be left to DEFRA or to the Secretary of State for one Department.
No one Department has the tools to combat air pollution. The Minister will say that she will work with the Department for Transport, the Department of Health and Social Care and many other Departments, but the new clause would ensure that others could learn from best practice—we would be able to see when things were not going well and put them right as quickly as possible. We need such a collective, joined-up approach. The Minister should raise her ambition to embrace other Departments that, in their hearts, want to work together for the common good.
As we have seen again and again with previous debates, the Government have a big majority and can vote against the new clause, but this is the opportunity—this last new clause—for us to come together and agree. The biggest test for the Government is not how many votes there are, but whether they are big enough to accept in good grace an idea from an all-party parliamentary group that they know is in the best interest and is supported in principle by all parties, and to take it forward for the common good. I think we would have cheers from people outside this place, who would hear that we are working together to tackle a concern that is so important to so many people.
This is an important opportunity to work together across government and public bodies to improve public health by improving air quality outside and inside, which would save lives. All our constituents would want us to do all that we can to protect them and their children, and the new clause would help us deliver on our duty to do so. I ask the Minister and members of the Committee to put their constituents and country first by supporting the new clause.
Rebecca Pow
After 230 amendments, why break the habit of a lifetime? Honestly, the hon. Lady will know that I have great sentiment about much of what she is saying. I also support the work of the APPG, who I have done a lot of close working with and spoken to many times. They have done some really useful work.
We recognise the importance of national leadership on this cross-cutting issue of air quality, including indoor air. It is right to draw attention to the issue. I want to give reassurances that we do not work in a silo. We work very closely with other Departments. We have a ground-breaking clean air strategy that goes across government. Air cannot be dealt with in one place and one silo, it travels everywhere, even to Gloucester. Only yesterday I had a joint meeting with the Under-Secretary of State for Transport, my hon. Friend the Member for Redditch (Rachel Maclean) on an air quality issue. Only last week I had a Zoom call with the Under-Secretary of State for Health and Social Care, my hon. Friend the Member for Bury St Edmunds (Jo Churchill). I hope that demonstrates how closely we are working on these issues.
On indoor air quality specifically, we are working across government. I have regular meetings with, in particular, the chief scientific adviser on this, and we work closely with the chief medical officer. We also work with the Department of Health and Social Care and Public Health England on indoor air quality in particular. They are all part of this big landscape, which she has pointed out. Building on the evidence base is a key step to ensure that interventions are appropriately targeted and introduced in the right way and in the right place. I hope that that gives some assurances on cross-government working.
I want to reassure the hon. Member for Putney that we have a range of reporting requirements relating to air quality, and we are introducing additional requirements through the Bill. We are introducing a requirement for the Secretary of State to make an annual statement to Parliament on progress toward securing local pollution objectives through paragraph 3 of schedule 11 to the Bill. Perhaps she has not noticed that. It will include steps taken in that year to support local authorities to meet objectives. In addition, the Secretary of State will be required to publish a national air quality strategy and review it every five years. That is under paragraph 2 of schedule 11 to the Bill, in case she wants to have a look at it.
Alongside this, through a statutory cycle of monitoring and reporting, which I have talked about constantly, the Bill ensures that the Government will take steps to achieve the targets set under the Bill. This includes the air quality targets. We have a legal duty to set an air quality target, and we are going to set another one in addition. We are going over and above for air quality. We can be held to account by the OEP if Parliament fails to monitor and report the progress toward the targets.
We also already have several annual reporting obligations on ambient air quality. The UK’s national atmospheric emissions inventory is compiled annually to report total emissions by pollutant. That is a very detailed inventory and has won an award, I think, for its detail. All of that information is already there. I think, perhaps, the Opposition are not aware of that. Do take a look. There is an annual requirement to report total emissions by pollutant and source sector in a similar way. We also remain signatory to the UN convention on long-range trans- boundary air pollution, because this is, of course, also a global issue, and we will continue to abide by that international agreement in full, including its reporting requirements.
The global work is really important. Back when we did the early assessment from the air quality expert group of what was happening during lockdown, we found that some of the pollutants did not reduce as we thought they might have done in the south of England. That was because we got some unexpected wind from Europe, and it brought all kinds of pollutants that were not even ours! It is very important that we remain part of that agreement.
Compliance with air pollution concentration limits and targets is reported in our annual air pollution in the UK report, which summarises measurements from the national air quality monitoring networks. I reassure the hon. Lady that we already work very closely with other Government Departments, and that we have robust mechanisms in place to report on progress. I hope that has provided more detail and clarity as to what is going on in air quality, and hope that the hon. Member might keep up with the trend—or maybe break it—and withdraw her new clause.
Fleur Anderson
I thank the Minister for the information about all the action being taken, and for the heartfelt—and I agree, sincere—desire to take action on this, and going over and above on air quality. We all welcome that. However, I have also read schedule 11 very thoroughly, as have the members of the all-party parliamentary group on air pollution. They have taken advice from scientific experts and feel that there is something missing in the reporting that would actually make a difference and ensure that we take the action we want to see on our air, and put that into practice. The missing parts are how public authorities are improving our air and how Government Departments are working together. I welcome the fact that the Minister is meeting with other Departments. She should welcome the opportunity to demonstrate what those meetings are resulting in with the annual report, and to demonstrate the appropriate targeting, achievements and progress we have discussed. As has been customary, we will be dividing on this, but we also want to work together to see a dramatic improvement in our air quality.
Question put, That the clause be read a Second time.
The Chair
May I congratulate the Committee on the briskness of our discussions this morning. The people of North Wiltshire—and of all our constituencies—are grateful to us for it. I must now report the Bill, as amended, to the House.
Rebecca Pow
On a point of order, Mr Gray, I wanted to do a quick round-up. The hon. Member for Putney mentioned that this Committee has gone on for 261 days. We started back in March, then the Committee was adjourned and all the rest, but the whole process of this Bill has been even longer than that. We have done two Second Readings, so it has been a long time in the process and even longer than that behind the scenes.
I give my heartfelt thanks to absolutely everyone, starting with the Chair. Thank you, Mr Gray, for keeping us in great order and managing to have a grandchild during the process. Thank you to the Clerks, particularly the new Clerk, who really got the hang of the role very fast. I must thank the entire Committee, because it is a long old haul, and we are all obviously handpicked. I must also thank all the shadow Ministers for the spirit in which we have conducted this—the hon. Members for Southampton, Test, for Cambridge South and for Newport West—as well as the hon. Member for Putney and indeed, the Whip. We all have the shared desire to improve the environment, and I do not think that is ever going to change. We will all be driving the endeavour forward, and it must be said that it is good to have a bit of probing.
I want to thank the members of my private office, who have been phenomenal at keeping me up to speed, which is not always easy. I thank the Bill team: Amira, who is sitting in the room, as well as Brendan and Lucy, and four others in the main team. I thank them all, because they do a phenomenal job. Hon. Members do not see it, but I do. We have about 100 policy officials behind them, so it is a massive effort. I thank them all from the bottom of my heart, because their work has been phenomenal. Some of it is pretty detailed and tricky, and I ask a lot of questions about legislative things, because I do not have a legal background. I thank them for all their work. This is not over yet; onwards and upwards to Report.
Dr Whitehead
Further to that point of order, Mr Gray. At the risk of straining the point of order, I would like to add my thanks at the conclusion of our Bill Committee proceedings. They have been immensely long, as my hon. Friend the Member for Putney has enumerated, with 230 amendments and 35 new clauses. I thank you, Mr Gray, for your purposeful, elegant and impartial chairing of our proceedings, and I hope you will pass on our thanks to Sir George for his part in proceedings. I thank the Minister for her immense optimism and terrific jackets, and for the courteous and good-hearted way she has conducted proceedings throughout. I appreciate that undertaking a Bill of this length is a tremendous burden, and I appreciate her fortitude and perseverance in carrying through that job.
I want to single out the Committee Clerks for thanks. They have been a wonderful source of assistance, help and wise guidance, and they have enabled us to do our part as well as we have been able to. Finally, I thank other Opposition Members. I think it will be agreed that they are not a team of journeymen and women; they are a team of Galácticos in their own right, and I thank them for their contributions to scrutinising this Bill so well.
We are, naturally, very disappointed that we have not been able to strengthen the Bill as we had hoped to do, but we will continue with that task on Report and in the other place. We hope that our doing so will help to make it a Bill that we can all be proud of, when it comes to strengthening our country’s natural environment resources and providing the protections that must flow from that; we all agree that we want the Bill to do those things. I welcome the end of this Committee, for obvious reasons, but we can all be proud of our contribution to getting the Bill to this point, and I thank everybody on the Committee for their part in proceedings.
Deidre Brock
Further to that point of order, Mr Gray. On behalf of my hon. Friend the Member for Gordon and myself, and with a slightly nervous eye on the clock, I thank all Members of the Committee for their good-humoured and thorough approach to the Bill. I have certainly appreciated that. I thank you, Mr Gray, and Sir George for your chairship. I thank the Clerks for their assistance, which has been much appreciated, and I thank the various representatives from Hansard who have sat through lengthy hours of this Committee. Although much of what we have debated has not covered Scotland, it has been instructive to hear from Members from all parts of the Committee about the approaches that are being taken. I wish England very well in all its efforts to create a much healthier and more vibrant, biodiverse and attractive environment for all its citizens.
The Chair
Those are all entirely bogus points of order, but we are grateful for them none the less.
Bill, as amended, to be reported.
National Security and Investment Bill (Fourth sitting)
Thursday 26th November 2020
(4 years, 1 month ago)
Public Bill CommitteesRead Full debate National Security and Investment Bill 2019-21 View all National Security and Investment Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 26 November 2020 - (26 Nov 2020)
The Chair
We now come to our third panel. We will hear oral evidence from Mr James Palmer, senior partner from Herbert Smith Freehills. This will last until 2.30 pm. Mr Palmer, welcome; thank you for joining us. Would you be so kind as to introduce yourself for the record?
James Palmer: Thank you very much, Chair. I am James Palmer, a corporate mergers and acquisitions, and investments, partner at Herbert Smith Freehills. I have been doing that work for 34 years. I have worked with the Department for Business, Energy and Industrial Strategy on business regulation for over 25 years. I also chair our global board; we are an international firm.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Q
James Palmer: I was advising the takeover panel and the regulator, not one of the parties, so our thoughts were more about their role in ensuring appropriate regulation of that takeover—not from a foreign investment perspective, obviously, but there was a foreign investment angle to it. I am not a technical expert. My read of that—nothing to do with the work I did, but obviously I followed it and all the other transactions that have been looked at—is that it was more about economic security and positioning than necessarily about national security per se, but I am not the expert on it.
I think the point that you are drawing out—I heard your question earlier today—is a really fundamental one, which is that there is a spectrum of things that can be regarded as matters of national security. Indeed, the Bill papers draw this out. On the one hand, you have things that are clearly national security, like the risk of infiltration of systems that the country’s security depends on or that the country’s systems depend on—critical infrastructure being an example—but I do think that there are aspects of the Bill that are touching on things that stray more into economic influence and stability.
Again, I am not the expert on this, but I think we all know that in the debate about what is a matter of national security, there is a question of economic dependence, supply chain dependence and so on. That is one of the most difficult areas for this legislation, because where you have a straight, obvious national security real risk of some cyber-infiltration or whatever, nobody is going to argue about that. The grey into issues of supply chain dependency and more economic security starts to raise some of the more difficult areas, which I am sure we can come to.
I do not think that there is a simple binary distinction, and I am not here to give you the answer as to what the right approach is for dependency on China for supply chains. All I would say, having worked out in Asia many years ago, is that the interconnectedness of the world is not going to reduce and we are going to need to find ways of navigating that.
Chi Onwurah
Q
Also, we have heard a number of times today that under the Bill—this will be reflected in your experience—we are going from 12 call-ins to a much bigger number: 90 or 100. And the impact assessment estimates that, I think, 1,870 notifications might come in under the new regime. Could you consider how best to reflect that or to put in place the skills and the resources for the Bill, and say a little about what impact you think it might have on the attractiveness of investing in UK companies and, in particular, small and medium-sized enterprises?
James Palmer: I have focused on the same numbers as you. I hope the Minister will excuse my saying so, because I think the team have genuinely done a superb job of looking at a lot of granularity on a swathe of issues, but there is one data point I did not agree with: the suggestion that there will be an 18% increase in the reviews; it was framed quite narrowly. In my maths, 12 reviews in nearly 20 years going to nearly 2,000 a year is well over a 10,000% increase. I think that that is a very important context in which to look at this—as the world outside looks at this, it is potentially looked at as pretty seismic change by the UK. Again, there is lots that we can go on to as to the ways in which the detailed thinking around this has tried to mitigate that, and I know the Department has worked very, very hard in trying to mitigate it, but I think that we just need to be realistic.
In terms of the skills, there is a fundamental question, which the Bill papers have started to try to set out, which is this: how do we focus the debate so that it is not all-encompassing? Again, the Minister is aware of my views on this. I am extremely pleased—I know that some may not share this view—that the Bill does not catch a broader public interest test. The reason for that is what happens every time we introduce a power for the Government, for very sensible reasons—these things are always about competing tensions with sensible reasons —to seek to interfere, review something and decide who should own it, or whether they want to impose conditions on that.
Let me give you an analogy. Let us say that I invite someone to come and invest in this country to build a house. At the moment, if I invite them to come to this country to build a house—or a business or a small technology business—they know they can build that house, live in it and sell it to whoever they want. If I invite them in and say, “Come and live in this country and build your house, but I reserve the right to decide who you sell it to and what conditions I impose on who you sell it to,” that is a very different prism—a new prism.
The Bill team have done a really good job of trying to narrow that so that everybody does not think, “Help! If I come to the UK, there is a Government discretion,” but there is an innate tension between, on one hand, the desire to have a broad power to interfere in circumstances that we have not all thought about to protect something as important as national security and, on the other hand, a desire to give investors certainty. My unhelpful view is that there is not a simple route through that, and I do worry about, in particular, small technology businesses.
Again, the team have done a good job of trying to narrow the sectors. This is a very different proposition, in terms of granularity, from what we saw in 2017 and 2018. But I think a lot of further work may be needed. The Government have been clear that they want to receive further feedback on how to narrow the remit. One example is the breadth of the communications sector, which has no de minimis. Artificial intelligence is not a thing done by four clever businesses anymore; it is a thing done by thousands of businesses. I think an awful lot of businesses are going to get caught that are not actually what the ministerial team are worried about.
The second bit is that, even outside the mandatory regime, other transactions may be judged with hindsight to be a matter of national security. Under the regime, a Minister—maybe not the current Minister, but whoever it is in the future—may decide that it is a matter of national security. As you have already highlighted, there is a spectrum of where economics becomes national security. People are going to worry about the predictability of investing in this country.
I am thinking particularly about smaller businesses. Obviously, there will be huge attractions to investing in the UK for technology. We have skills and expertise that can only be exploited here. The UK has had a very distinctive position as one of the few countries in the world where businesses without a particular nexus to a country have chosen to go as a destination of choice. Those businesses are the ones I am most worried about.
There is also the cost and risk for small businesses. If I was a European venture capitalist, how comfortable would I be in investing in a technology business in the UK that I will be able to sell it to an American or Danish buyer—not the Chinese—in five years’ time, or at least to do so simply? In terms of the call-in power, why would boards take a 1% risk that in five years’ time somebody will judge your transaction as being one that should have been notified? Why would I take even a 1% risk of my transaction being unravelled? I think that the Department has worked very hard—this is not just ritual politeness; I really think it has—to try to narrow it, but I do not think it has done so enough, because I think that there will be a lot more than 1,800 notifications.
Chi Onwurah
Q
James Palmer: My partner, Veronica Roberts, appeared before the Foreign Affairs Committee on Tuesday, and she and I will be submitting a list to this Committee. I am afraid we do not have time to go through it today, but I will draw out a couple. Some of the mandatory filing sectors are very broad, such as communications. Again, the Government have said that they welcome narrowing those. There are not de minimises in a number of those sectors. It is true that there are other jurisdictions that do not have de minimises, but they are not jurisdictions with as large a proportion of their GDP linked to trade, and they are not jurisdictions that are as much seen as international business headquarters as well as centres of international business; there is a difference.
There is a de minimis for transport, for example, and it is very focused on ports over a certain threshold and on airports over certain levels of traffic. That is excellent, because those are the kinds of business that it makes sense that you would want to catch. The same layering has not been applied elsewhere. In particular, I worry about catching the sale or the licensing of intellectual property in relation to any of the technology areas. I think that that will catch an awful lot of things that people have not thought about yet, and I think that it will create a big burden for those small businesses.
I can conceive that in one or two very narrow areas—in some of the material science and so on, I am told—there may be low-value things that need to be caught. I am personally very sceptical that low-value things need to be caught in many other areas, because how can they be that important to the economy if they have a value that is below £1 million?
One of our concerns is that, although we know that the Government are very committed to a free trade agenda here and trying to make this work, I have worked with new regulators as they have developed for a very long time, and—forgive my saying so—I have never seen a regulator whose remit was only at the level that was predicted when it was set up. All remits expand exponentially, and that is one of the fears we have.
I would certainly advocate ensuring that the factors that the Secretary of State has to have regard to include, for example, impact on trade. The cost-benefit analysis sets out a sensible attempt—again, it is a much more developed piece of work than the, frankly, not-that-great cost-benefit analysis done in 2017-18; this one is a good and credible attempt—to work out what the actual cash costs are. But it does not address, as the Regulatory Policy Committee drew out, the real economic costs. It may all be okay, but the risks there are not hundreds of millions, but absolutely billions, and the UK’s competitive positioning there.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Nadhim Zahawi)
Q
James Palmer: I will just explain why. I remember working when the public interest regime still applied. The move away from the public interest regime started in the 1980s. Pre the 1980s, this country was not an international investment destination; it really was not. We have earned that position. Whatever one’s politics—I am not party political—this is something that the UK has earned. We have done that by moving to being pretty open-minded in foreign investment. We have actually not worried that much about national security considerations being controlled through ownership, because again this debate has been—sorry, let me first come back to the Minister’s point.
I am very nervous that if you open it up to public interest, you vest that authority in a politician; forgive me, but that is what leads to lobbying, to short-termism, and to completely inconsistent decision taking. I am afraid that whatever Ministers at the time may say about these decisions, there is no external credibility on the predictability of those. It does not matter whether Ministers think they are doing it in good faith or on security grounds. It does not come over that way.
On broadening it to public interest, I completely agree. I am very grateful—because I know that there was a debate about this—that it has been rightly focused just on national security, albeit with a broad ability to intervene to protect the national interest.
Stephen Kinnock (Aberavon) (Lab)
Q
James Palmer: My own view is that I actually hope so, because I think that there is a debate here. We all identify a business that has been established in the UK, and we regard it with pride as a national asset. I completely understand that. I am not just interested in global M and A; I am interested in investment in the UK. My goal is not just M and A. It is the investment, which we will not get without M and A at the end, because investors want to know that they have the ability to realise.
My own judgment—I am not an economist, but most of the economic evidence that I have seen supports this—is that you do better by allowing people to come in, allowing them to sell, not necessarily completely untrammelled, but on a broadly liberal perspective, giving them the certainty and confidence to do that.
I think what we are debating here is about those things that are generated solely in the UK—for example, research, work and ideas that are funded by the UK Government. I can see why the UK Government might want to keep control over those things and link their funding to a level of control. If someone takes funding on that basis, I can see that. I do not know enough about the history of Arm, but it was acquired by a Japanese parent, not by a so-called hostile actor. If we are not going to allow Japanese businesses to buy into our technology businesses, I think we look like a less interesting technology investment and growth destination. We might hold on to a business for another five years, but what businesses are we losing for our children and grandchildren in 10, 20 and 30 years’ time? That is how I look at the question.
Stephen Kinnock
Q
James Palmer: Partly. I was involved in that as well—not entirely, actually. By the way, I think there is a misunderstanding about hostile versus agreed deals. Agreed deals, politically, are regarded as generally okay, and hostile deals as not. But it is about price normally. In occasional cases, there may be other factors, but I think that should not be the determinant of whether a deal is favoured or not.
On AstraZeneca-Pfizer, the challenge there is that AstraZeneca is not just a UK company; it is a global company. Most of its business is not in the UK; it is all around the world. It was built up by making acquisitions all around the world. If we say that it cannot be acquired by an American pharmaceuticals company, what message does that give to businesses that want to come and headquarter in the UK to then go and buy elsewhere? The UK has been a net acquirer globally, and I think that our openness is what has allowed us to do that.
I completely understand the concerns about jobs, and I completely understand the concerns about science and the preservation of skills, and I do not dismiss those, but I worry that by trying to hold on to what we have today, we lose the appeal in the long term, a bit at a time, to people coming in the future. It seems to me that if we are going to have research in the UK, which I think we will, it should flow from our research skills, not from holding on to things that want to leave.
Stephen Kinnock
Q
James Palmer: There is an interesting issue about compliance with law. You need to be careful, because clearly, the draft legislation envisages—as, by the way, I think, the current very broad discretion, which catches an awful lot of transactions, gives discretion to do—allowing quite a bit of leeway to exercise judgment as to what is a national security issue. If you have an investor that is clearly law-abiding and not about to try to put toxic software into your systems or whatever it might be, you are going to worry a lot less about them, so I do not want to limit the discretion.
Do I think that you need to draw out compliance with law in particular? I am nervous about doing so, because it could become a hobby horse for a company that has breached some law somewhere or other. If a big global company has 50,000 employees, people make mistakes; someone somewhere will do something that will transgress. So I worry about it missing the substance. I think there is a discretion to look more substantively, rather than being too much tied to whether they are law-abiding or not. Again, there is clearly a China focus here—I am neutral on that issue; that is for you—but you are not going to know whether a Chinese company is law-abiding outside China or in China, in particular if it has not invested outside China before.
The only other thing I would say on comparator regimes is that the whole debate on this has been framed, as it was in the 2017 paper, around the main rationale, which was, “Other countries are doing this, so we need to look at it.” A much better rationale, which has also been articulated by the Government, is, “We’re coming out of the EU. We’ve got EU-based legislation at the moment. It’s actually the right time to take stock, rather than necessarily that the old regime was hugely defective.” I do not think it was as defective as everybody is saying.
We keep talking about France, the US and Australia. My firm is the largest law firm, or one of the largest law firms, in Australia, and we are in all the markets—France, Germany, Italy and Spain—that keep being cited. Those countries are our very friendly trading partners, but none of them has the reputation for being as open and free trade-oriented as this country. I think we need to be careful about setting comparisons with the most controlling of our friends, not the least controlling, because there are a whole load of countries that have not been named in any of the discussions that are not doing any of this.
Take Ireland and technology. Maybe, under pressure from the EU, they will introduce something, but the Irish have been trying to grow technology; so have the Danes and the Swedes, and the Dutch as well. The Dutch will come out with some proposals in this area, but my expectation is that they will be much more limited. The Dutch are very internationally competitive. For new industries—for green tech, which we really want to be in—the Nordic countries are significant competitors, and I do not think they are going to have all this. I think that, for investors, that is a factor we just need to bear in mind as we try to find the right balance.
The Chair
We have less than five minutes left, so I suspect that this will be the last question. Mark Garnier.
Mark Garnier (Wyre Forest) (Con)
Q
James Palmer: I have not done any analysis, and I have not read the economics—that is beyond my pay grade—but I have worked on hostile takeovers for a very long time, and I have been involved in loads of auctions of businesses, with debates about who the buyers are and so on. It is blindingly obvious, isn’t it, that if you have fewer buyers, it has a price impact? I think the question is, what is the appropriate, proportionate acceptance of that? I do not think we should kid ourselves; if we want to dial up focus on national security, there will be a level of impact. I think what the Government are trying to do—they have sent very strong signals that this is their goal, which I am supportive of—is to ensure that, yes, we do it, and, yes, there may be a little bit of consequence, but that we try to keep it in proportion.
I think the risk we have here is not with the 10 or so active interventions that the Minister and Lord Grimstone have talked about in briefings on this, which is a very positive signal and a big reduction from the 50 or so that were consulted on before—that gave us, frankly, very high levels of concern. The concerns are, first, will that be held without a really rigorous review mechanism that ensures there is accountability over that review? I would raise four-year, eight-year, 12-year, continual reviews, where you actually look at economic impact and there are evidence-based requirements. I would also bring in proportionality on those to the judgments, because if you ask a group of very intelligent civil servants to think about risk and say that their job is to protect national security, you can find national security risks in almost anything.
I think there will be market distortion impact. John Fingleton, the former chief executive of the Office of Fair Trading, has commented broadly on this. The Economist wrote in an August article about the negative economic impact on US GDP being significant from its equivalent step up of the CFIUS rules. I think it is about trying to thread the needle in a way that keeps that very narrow and limited.
Mark Garnier
Q
James Palmer: I heard the question that you raised this morning on that. I am not troubled by that. I think debt is a bit of a myth. The material influence test that the Government have picked is lower than a number of other EU countries have gone for but is at least consistent—it is levered off the test we already use, which I think is helpful—so I am personally a bit less worried about that than some others are. Finance does not worry me that much. If somebody seeks to foreclose and exercise, they are not going to be able to do so if they are going to be caught. I think we could get ourselves in a knot, and I think the London financing markets could be disastrously impacted if we were to start to try to regulate lending heavily on this.
The Chair
I am afraid that brings us pretty much to the end of the time available. Many thanks, Mr Palmer, for your time and your assistance to the Committee.
We will move seamlessly on to the next session and hear evidence from David Offenbach, a consultant at Simons Muirhead & Burton. While he is taking his seat, let me say to those members of the Committee who were not able to ask questions last time that I will try to make sure that you get an opportunity on this occasion or a future one.
Examination of Witness
David Offenbach gave evidence.
The Chair
Welcome, Mr Offenbach. May I ask you to introduce yourself for the record?
David Offenbach: Yes, thank you very much, Sir Graham. I am consultant solicitor with Simons Muirhead & Burton solicitors, a firm of some 32 partners, and I have been there 19 years. I am here in a personal capacity. Previously, I was a senior partner of the law firm founded by my late father, and I merged my practice with Simons Muirhead in 2001.
I have acted for small public and private companies, and for 15 years, I was a non-executive director of a fully listed plc. I have been involved professionally in takeovers, and I have written on the subject. Currently, I am updating a paper I wrote previously called—this may be of interest to you—“Takeovers and the Public Interest”.
I have recently ceased being a further education college governor and non-executive director, after 18 years’ service, and I was with a social housing company for 15 years. In fact, one that I finished a term of six years with was the subject of one of the largest takeovers in the social housing sector. It is now one of the biggest housing associations.
Briefly, I welcome this Bill very much; but the UK has changed fundamentally since 2017, when the Government started their consultation on this, so I think that it is good, but it could be better. If the United Kingdom is going to build back better, as the Chancellor said yesterday, after covid and after Brexit, whether there is a deal or not, then this legislation needs to be wider than it is now, and I have some suggestions on how it could be improved and some amendments that might be made to it. Excuse me; I’ve got a bit of a cough.
Chi Onwurah
Q
David Offenbach: Well, there are three categories. First, are the 17 subjects that are referred to in the paper sufficient? Sir John Redwood, in the debate last week, said that food should be included, because there is nothing more important than food security. Mr Tim Loughton said that pharma and biotechnology should be included. There is not really very much on energy in the 17 subject matters. So I would like to see those included.
The next is the definition. National security is not defined in the Bill, which I actually approve of, because once it becomes too closely indicated, then it is not easy to decide what should be in it, or what should not be in it. I would like to see a definition that includes what Lord Heseltine said when Melrose took over GKN, that research and development should be a subject of importance; it should be included.
The other thing I would like to see included, contrary to the last speaker, is a general definition of public interest. The reason for that is that when you look at recent examples, you see that it is very easy for things to slip through the net that actually might be both in the national interest and in the interests of national security as a specific point.
Some of these examples have already been mentioned: SoftBank’s purchase of Arm. Now, that was world-beating British technology. It is in every computer, it is in every telephone and it came from Cambridge. It is now the subject of a bid by an American company owned by a Japanese bank. Do we really want to try and hang on to the research and development—as someone said in the House of Commons debate last week, the Crown jewels, or as Harold Macmillan said many years ago, the family silver? At this economic time, is it not desirable that we try and hang on to these important assets that are homegrown? Is self-reliance something that we should bear in mind?
Similarly, in 2014, Google bought DeepMind—world-beating British technology in artificial intelligence. Should that have been the subject of consideration? Recently, Lady Cobham was bemoaning the fact that Cobham had been sold to private equity for £4 billion. She said she only wished that the Act had already been in existence, and then perhaps the nine divisions that have now been reduced to four and the sell-off that started would not have happened. Of course, one of the problems is that the post-offer undertakings that can now legally be provided by companies to the takeover panel are fairly feeble and do not really deal with the issues to protect the necessary research and development and public interest.
At Immarsat, as those of you who drive around Old Street roundabout in the middle of London’s tech city will know, there was a £4 billion takeover of world-beating satellite technology. It started as a United Nations organisation, then became private and was quoted on the London stock exchange and has now gone to private equity.
Nvidia is buying Arm. When they bought Icera in 2011 in Bristol, they closed it down, 300 people lost their jobs and the technology went abroad. One that might now cause a bit of embarrassment is the case of Huawei, which bought from the East of England Development Agency the Centre for Integrated Photonics in 2012. Another piece of world-beating technology owned by the British Government has now gone abroad.
Those are just some of the numerable examples of assets that, at this difficult time, we really ought to try and hang on to. I do not want to decry the argument that Britain is open for business and that we believe in free trade. We do. There is twice as much foreign direct investment into Britain as there is into France and Germany. Several hundred thousand French people live in London. It is the fourth largest French city for French citizens. Why? Ask anybody. It is much easier to do business in London that it is in Paris.
As for the other argument—that if we do not make the business climate easy, people will start up their businesses elsewhere—the answer is that they will not, because in the other places where they want to open their businesses the regimes are tougher than here, so that argument does not wash. France has just passed its recent new law. They use a slightly different test that is strategic. Their test is not quite as wide as public interest. Of course, a right to intervene on strategic grounds is what Mr Tim Loughton and Mr Bob Seely suggested in the House of Commons debate last week, and Mr Tugendhat was very sad about the fact that Google had bought DeepMind and that SoftBank had managed to acquire Arm. For all those reasons, I think we do need to add to the definitions. That is the position.
Chi Onwurah
Q
David Offenbach: It is very difficult to separate these. When you look at GKN, for example, 50,000 people—even now, after covid—are headquartered in Redditch, near the Minister’s constituency. It is one of the largest industrial companies worldwide, 250 years old, and a defence contractor to the Ministry of Defence, but the question is whether the amount of defence work it does, apart from its other engineering, is sufficient for it to be called in under the existing legislation. Clearly, the decision was made that it was not appropriate, and it is the same with Cobham. Cobham clearly had a national security element, but it was not sufficient for it to be called in and blocked by the Minister, so I think it is very difficult to separate the economic from the national interest, because these companies are multi-layered; they operate in different markets; some of their work is sensitive, and some of it is not sensitive.
That is why I think it is better to try and improve this Bill than deal with it under a separate Bill. The problem is that it has taken three years to get to where we are with this Bill. If we are just going to say, “Let’s deal with it another time”, it might take another three or four years before we get to consider that, so while it is here, while it is on the table, let’s try to improve it now and make it really work for Britain, so that we can build back better—to use a phrase—going forward.
Nadhim Zahawi
Q
David Offenbach: I am very pleased with it. It is much better than the previous regime, because now, rather than just having post-offer undertakings that are subject only to contempt of court criteria if they are breached, we have a proper statutory framework that will enable the Minister to impose orders so that for non-compliance, there is a breach of statutory duty, not merely a breach of an undertaking. Of course, one of the problems with the takeover code is that the object of a takeover code is to protect shareholders and to encourage fair dealing in takeovers. It is not there—and this has never been its job—to protect the public interest; it is there to protect the shareholders who are in receipt of an offer, so that they have been given fair treatment. For example, if you take SoftBank and Arm at the moment, we do not know whether or not they will have complied with their post-offer undertakings when the five years is up, because the price that is being paid now is more than was paid in 2016. There is no complaint. Public interest is irrelevant to the job of the takeover panel, which is why this new regime is a very welcome improvement on the old regime.
Sam Tarry (Ilford South) (Lab)
Q
For me, there is something really important we need to explore a little bit more when it comes to our approach, in terms of rushing to be the most open, the most liberal, the most pro-business country we can possibly be, and the exposure that is left—in this case—to China. Just thinking about that, are there particular areas of law that you think need to be tightened up and thought about alongside this, and that need to be looked at in tandem, perhaps around IP protection, licensing and that kind of thing?
David Offenbach: I think this actually does most of what is necessary. I do not think it needs to be improved in that regard. One thing that does slightly worry me is that the present regime, which is essentially a competition regime, has the Competition and Markets Authority as a statutory body, having lost national security to the new unit that will be set up inside BEIS. They only have financial stability, media plurality and public health, which was added this summer, but it is a proper organisation that deals with public interest in those areas. Public interest is the only area.
It is quite important for us to think that one of the reasons why one wants to extend the definition of national security to a public interest element is because there are many more areas of public interest, other than those three that are now left in the CMA. There is a little bit of an anomaly, because national security does not have its own separate statutory body to deal with these issues. It suggests that this is going to be put into a little hole somewhere in BEIS and that somehow competition is more important than national security, because it has a statutory body.
I wonder whether there should be a parallel statutory body, which could be called the national security investment commission, or something like that, that actually dealt with these things separately, outside BEIS. That would deal with some of the objections that people have and that a Minister is going to be lobbied about. It would be dealt with in more of a quasi-judicial way, in the same way that the CMA now deals with referrals to it. I wonder whether the Minister would like to consider that, as part of the amendments.
Sam Tarry
Q
David Offenbach: I listened to and read the Second Reading debate in the House of Commons last week. I know that a lot of Members were concerned to try not to let issues of industrial strategy stray into areas of national security. It is a subject that I do not really want to go into.
Some people have expressed anxiety about the activities of sovereign funds in other countries posing dangers to assets in this country. Is there more of a risk from investments in China? Somehow, people feel that those investments are connected with the Government and that they are not really independent. I think the necessary protections are in this new statute that will prevent that from being an issue.
So far as industrial strategy is concerned, people are worried about sovereign funds. I think Britain should have its own sovereign wealth fund, like Norway does and like we used to have with the Industrial and Commercial Finance Corporation, and then with 3i. There are amazing investments that could be made and wonderful technological discoveries that Britain should be able to get the profits from, and that should not be going overseas. When I went on a trade visit to China a few years ago, I saw the China Investment Corporation. They said, “We are really pleased with our investment in Thames Water. We do nothing every year. The dividends come and it doesn’t cost us any money.” I thought, “Why shouldn’t Britain have the advantage of the dividends, rather than the China Investment Corporation?” Norway’s sovereign wealth fund is worth more than £26,000 for every citizen in Norway and is one of the most successful. That is something that really we ought to look at.
Simon Baynes (Clwyd South) (Con)
Q
David Offenbach: Yes, I am.
Simon Baynes
Q
David Offenbach: No, I do not—not in the slightest. I am thinking of clients of mine—French—who moved from Paris to London because it is easier to set up and promote business here. Why did they not stay in France? Because they know that the regime is more restrictive. Why did they not go to Australia? Because they are a similar regime. They are more restrictive. We are a very open environment to do business, in this country. You can come here and set up a company in 24 hours, and start trading. You cannot do that in France: it is much more difficult. In Germany, it is much more difficult, and in Australia. Those comparable regimes, if you like, are less favourable. That is why people come from the Baltic countries to set up business here. It is much easier to do business.
Simon Baynes
Q
David Offenbach: We have the issue that we do not know what difference being out of the European Union is going to make to future investment; but Ireland has been very attractive for many years, partially because of the tax regime—and for lots of other reasons—so will people choose Dublin rather than London if they want to do business? They might very well, but the fact that Britain is open to trade is an important part of the British economy. People will still come here and work here, open businesses and enjoy the infrastructure of the technology and the various businesses that are already here, and that they can feed off, so I am not worried about that in the medium term.
Peter Grant (Glenrothes) (SNP)
Q
David Offenbach: It does not need to be any different at all. I was pleased that land was included. Certainly one knows from seeing property transactions and looking at title deeds, sometimes where the owners of these companies are or purport to be is very curious. The Bill covers that very adequately.
Peter Grant
Q
David Offenbach: I do not know. I am sure that officials in the Minister’s Department have thought about whether or not this is an issue for the devolved Administration, but I do not think it is a problem.
Peter Grant
Q
David Offenbach: Yes, it is. The first thing that will be looked at is where is the beneficial ownership. It is, first, follow the money and, secondly, follow the beneficial ownership.
Peter Grant
Q
David Offenbach: Then you block it.
Peter Grant
Q
David Offenbach: Yes, I am sure that is what the security unit will do. If it cannot be established where the beneficial ownership is, then they will block it, and so they should.
Peter Grant
Q
David Offenbach: Well, I remember there was an outcry years ago when Michael Portillo was a Defence Minister and they were going to sell the Ministry of Defence. There was an outcry and it was withdrawn. Should Admiralty Arch become a hotel or is that an asset? These are the sort of issues which, if they come up, will be dealt with at the time. I like to think that certain things are fairly sacrosanct. We would not sell Buckingham Palace or Windsor Castle to a foreign buyer if we did not know who they were—or at all, in fact.
Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
Q
David Offenbach: The answer is that one is not quite sure. That is why I want to widen the definition. The reason why there are 17 different areas and categories in the Bill is that it is hard to know what national security is at any particular time and how it is reflected in the business that is actually being considered. The only way to make sure that something does not slip through the net is to have a slightly wider definition. There is no definition of national security itself in the Bill, which is perhaps why strategic, research and development, innovation or other issues should be brought in. Then one can be quite sure one has not accidentally lost an asset where there are national security issues.
Matt Western (Warwick and Leamington) (Lab)
Q
David Offenbach: Completely. It has also changed how the Government view it. In the summer, public health was added to the list of items on which a public interest intervention notice can be given. So it is clear that, in the face of the national emergency that, alas, we face—according to the Chancellor it is the greatest economic crisis for 300 years—we have to hang on to our assets. That is why the Bill is even more necessary than it was before. The pandemic gives added weight to the arguments that I was making even before we had covid. We need to have a wider test to protect our national assets.
Matt Western
Q
David Offenbach: I am not personally worried about state entities being said to pose more of a risk, because I think that the Bill is strong enough to make it possible to intervene where necessary. Although one is entitled to look at the asset being purchased, the acquirer and the person from whom it is acquired, I do not think that it will be a problem under the Bill as it is drafted.
Matt Western
Q
David Offenbach: I do not think that there is anything other than the 17 already mentioned and the ones that I mentioned, most of which came up in the debate last Tuesday. I think that telecoms might be mentioned as well, but the list really covers all the areas where national security is a significant risk.
Stephen Kinnock
Q
“Land is generally only expected to be an asset of national security interest where it is, or is proximate to, a sensitive site, examples of which include critical national infrastructure”.
Do you think that scope is too narrow? For example, we know that property in London is used to launder large amounts of money—nefarious organisations often own property in London and use it for nefarious purposes. London is sometimes referred to as a laundromat for dark money. Do you think that that is a national security risk and should be included in the scope of the Bill, and that the land definition in the statement of political intent should reflect the money laundering issue?
David Offenbach: I am not sure I quite agree with the statement of intent as part of the Bill papers. The drafting of that section of the Bill is wide enough to include the issues that you raise. It would be open to the Minister to intervene in the cases that you mention without any change to the drafting of the Bill being necessary.
The Chair
If there are no further questions at this point, I will say thank you very much, Mr Offenbach. The next witness is not due until 3.15 so we will have a 10-minute suspension.
The Chair
We will now hear oral evidence from our fifth panel. We welcome Mr Creon Butler from Chatham House. We have until 4 o’clock for this session. Mr Butler, may I welcome you to the Committee? Please will you introduce yourself for the record?
Creon Butler: I am Creon Butler, the director of the global economy and finance programme at Chatham House. I am very pleased to have the opportunity to give evidence.
Chi Onwurah
Q
Creon Butler: You get right to the heart of the matter and, indeed, to one of the points I wanted to make. Yesterday I looked at how national security is defined, and the “Collins English Dictionary” defines it as preventing a country from being attacked by hostile powers. One very important thing in relation to this Bill is that, first, while there is a good justification for having a broad range of powers to intervene, given the breadth of those powers to intervene and collect information, it is important that the Government define more clearly than they have hitherto exactly what those powers will be used for and, in those terms, use them in relation to national security. Specifically, I mean investments that could lead a hostile power to have technology that would enable it to make better weapons to attack us or would enable it to intervene in our critical national infrastructure.
There are other aspects of economic security, such as having a major industry in AI, renewable energy or something of that kind, that could be relevant to broader security in the future. You may well want to have a strategic intervention to ensure that the UK has that kind of industry, but I do not think this is the Bill for doing that. I think there are other tools you would want to use, including competition policy, strategic investments, contracting, R&D and so forth. That is one of the points I wanted to make.
Chi Onwurah
Q
Creon Butler: On your first question, I do not think we have that yet as a country. Actually, with the previous Prime Minister we had a clear definition of a number of sectors that were felt to be very important, but it is a continuing story in terms of exactly how we are going to intervene to ensure that those sectors are strong. We have some powers, but there are a range of tools. I previously mentioned public contracting, where we do our research and development, and competition policy specifically to make it impossible for British companies to develop in those sectors, and so on. There is a broad range of policies for ensuring we have those sectors, and I think they are continuing to evolve.
Your second question is a really crucial one. I guess a key point is that this is not an absolute thing: you cannot protect the country from all possible national security risks through this route. The only way you could do that, potentially, is by having every single investment notified and examined. That would create an enormous bureaucratic monster, which would really not be what we want.
The further point is that when you are looking at the right cases, you want to be sure that the judgments that are made trade off with the national security risk, as I have defined it, but also with the potential economic benefit of having an investment in that area. To do that, you need expertise among the people who are making such judgments, which spans security expertise but also economic, investment and commercial expertise. It is very important, first, that there enough people to do the judgments properly, and secondly, that you have a breadth of expertise. Certainly in the past, we may have swung from one side to the other. Sometimes you have had what people would describe as a securocrat approach: “There is a possible risk here. Let’s go for it—let’s eliminate it, whatever the economic cost.” Sometimes, on the other hand, you have had the alternative situation: “Let’s encourage investment, whatever the risk might be.” I think it is important that we get a balance between those two.
Nadhim Zahawi
Q
Creon Butler: I think—I am sure many people have said this—it is very clear that the previous legislation needed updating and was not fit for purpose, given both the way in which the global economy as a whole has evolved and the way in which the threats have evolved. It is both necessary and urgent to update that, and the way the Bill has done that, in terms of this first phase of creating the powers both to collect information and to intervene, makes a lot of sense. We have to fine-tune it and make sure it works properly, but this is a good first step. As I said, though, it is really important, if you are going to have such broad powers, to define exactly how you will use them—and much more precisely than the Government has done hitherto.
The further point is that this piece of legislation does not do everything. Alongside it, we need to strengthen our ability to collect the information we need about those threats. There are a number of elements. One that I have some experience of and that is really important is the question of who actually owns and controls companies that are operating in the UK—the question of beneficial ownership transparency. If you do not know that a hostile power is influencing a company that might be registered in an overseas territory or something of that kind, you will not be able to take the steps that you need to take.
A further area—it is a step in the right direction, because it gives us the powers to engage with this issue —is through international co-operation. Looking forwards, we need to strengthen and enhance our international co-operation with like-minded partners by going beyond the Five Eyes and including other really key partners, such as Japan, the EU and so on. That will enable us to do two things. First, it will enable us to share information about the things that can happen, such as the techniques that hostile powers are using. You may see it come up first in one country, and if we can share that information, we know that we can be prepared for that. Even more importantly, you may have a hostile power that does a number of things in different parts of the world, and it is only when you see the entire picture that you can see what the threat is.
Having that kind of international co-operation to do that is really important. These powers are necessary to get us in the same place as some of our key allies, in terms of what we can do. I do not think we are ever going to be able to standardise the areas of intervention or the nature of powers, but we should push very hard to enhance the sharing of information in the way I described.
Stephen Kinnock
Q
“the National Security and Investment regime does not regard state-owned entities, sovereign wealth funds—or other entities affiliated with foreign states—as being inherently more likely to pose a national security risk.”
Do you agree with that assessment? Logic would seem to suggest that the closer an entity is to a foreign Government, the more likely it is to pose a risk to our national security.
Creon Butler: Clearly, some state-owned enterprises can be a significant risk, but some clearly are not. VW has a significant state element in it through North Rhine-Westphalia, but that does not make it a national security risk. At the same time—this goes back to the point I was making about who actually controls companies —you could well have a company that is registered in another country and, particularly if that country does not have very beneficial ownership transparency laws, as even some very close allies such as the US do not, the company emanating from it could have ill intent towards us.
For that reason, I think the Bill is right not to make a special regime for companies that are state owned, because that could go wrong in two ways: either you could be looking at only one set of companies when there are others that are potential threats, even though they come from close allies, or you may end up spending a lot of time looking at companies with state shareholdings that are really no threat at all. Clearly, when you come to do the analysis, whether there is a stake from a hostile state will be an important part of the analysis that you do in assessing that threat. I think the Bill gets it right in not creating a special regime, but that does not mean that this will not be an important part of the analysis that you do in assessing the threats.
Stephen Kinnock
Q
Creon Butler: I did not read it quite that way. I read it more as meaning that that is not a reason for having a special regime, but when it comes to doing the assessment, you look at whether there is a state element of ownership and from which country that state element of ownership comes. That would be a factor when you are examining the likelihood that that particular investor could pose a threat to us. I am not a lawyer; I just read it that way. If the way you are reading it is the correct way to read it, I do not think that is quite right.
James Wild (North West Norfolk) (Con)
Q
Creon Butler: It is a constantly evolving picture. The benefit that the NSS can bring is a strategic overview. When you want to put the element of national security protection in the context of broader economic security issues, it is really important that the NSS plays a key role. I do not know the precise detail of exactly what the linkages are between the new unit and the NSS. I would think, from the way I worked in the NSS, that they will be very close in term of people, exchanges, links and so on.
In terms of the respective roles, the strategic role is one that the NSS should play, looking at this element alongside all the other elements of national economic security. As I understand it, it is very important that this unit has a very strong operational focus and effectiveness, the skills that enable it to do this, and the space in which to do it. If I was in charge of designing the relationship, that is how I would design it.
James Wild
Q
Creon Butler: There is obviously a trade-off again. My sense was that the provisions that are there now are realistic and sensible, but we need to see how the thing evolves and fine tune it according to the experience that we have had. People have pointed out that this will lead to a lot more cases being looked at than before. I do not think that that is a criticism of what is happening; it is a reflection of the world that we are in. However, in the light of the experience of looking at a much broader range of cases, we should be ready to adjust the timeframes and so on, taking account of that experience.
Matt Western
Q
Creon Butler: In my view of economic security broadly, the biggest existential threat is climate change, frankly. We are going through a ghastly pandemic. Fortunately, it looks like we can see the way out of it, but I do not think that at any point we felt that this particular virus was an existential threat to mankind more generally. My view of climate change is that it is, and it is very close. In any broad assessment of national and economic security, I would put climate change as one of the most important issues. That is why the accelerating efforts both within Governments and in the private sector to deal with it are crucial.
In terms of other kinds of threats, we have had this particular pandemic, which as far as we can see is not an existential one; there could be other pandemics that are. That is why infectious diseases have been so high on our risk register in the past. Steps to ensure that we do not face future pandemics that are even more serious than this one in terms of the threat to human life, or the economy, are a very important priority. Those are two examples of broader threats beyond hostile powers that we should incorporate in our approach to national and economic security.
Peter Grant
Q
Creon Butler: It is a good question. It is something I worked on when I was in the Government. There is a pending proposal in relation to property, to ensure that no foreign company can invest in UK property without some means—whether their own register of beneficial ownership or a regime put in place in the UK—of ensuring that transparency. That is in relation to ownership of property. It did not go much broader than that, because it involves a major bureaucratic process and there is the issue of not interfering too much with the way the economy works. If we did do that, it would help in relation to one of the national security concerns we have, which was highlighted in the Bill, where a hostile power buys some property close to a very sensitive site.
I need to think about it a bit more, but I do not think it would make sense at this stage to require that we can identify the ownership of every single investment. For example, in the US they do not have consistently strong beneficial ownership rules. You might find a situation in which several US investments in the UK did not meet those transparency requirements. If they were in non-sensitive sectors and did not pose a threat to us at all, it would create a considerable burden.
Thinking it through on my feet, the logic would be to do something of that kind, where it related to sectors that we knew to be sensitive. Indeed, those are already covered by the mandatory notification case. Where you have the mandatory notification, it will presumably trigger information about who owns the company that is making that investment. If that is not clear now, that may be the route to make sure that this element is covered.
Peter Grant
Q
Creon Butler: Absolutely. We currently have a public register of beneficial ownership for all UK-registered companies. That was a major and important step. There are issues about whether we are doing enough to enforce those legal requirements. That area could be looked at helpfully in this context. When that regime was designed, the view was that market forces, external pressures and gathering information from NGOs and others would ensure that the information on the register was accurate. I am not sure that we can now be sure that is the case. We want to get that transparency for UK-registered companies, and we may need to do more in that direction, particularly through the enforcement process in Companies House.
Stephen Flynn (Aberdeen South) (SNP)
Q
Creon Butler: I think this comes again to the point about how we will tightly define national security in relation to these broad powers. I think you are thinking of a hostile power investing in a social media platform that can then be used to attack the UK—I guess that is what you have in mind. It is, again, something that I have not thought through. Probably, I would not see the nature of the threat as being so great that we would necessarily make it a mandatory notification, but by using other sources to collect information about threats, we might use the other powers in the Bill—the calling in and those kind of powers, and the voluntary notification —to make sure that we had covered the threat. I do not think I would put it in the mandatory category, but I would want to use other information and powers to collect information, and to call in a particular investment if I felt it was a threat.
The Chair
There are no further questions, so thank you, Mr Butler, for your time and your assistance to the Committee. We have our witness for the sixth and final panel in the witness in the room, so we can move on seamlessly and a little early.
Examination of Witness
Will Jackson-Moore gave evidence.
The Chair
We have until 4.30 pm at the latest for this session. Mr Jackson-Moore, will you introduce yourself for the record?
Will Jackson-Moore: I am a partner at PricewaterhouseCoopers. I am responsible for our relationships with private equity, infrastructure, real estate and sovereign funds on a global basis. I started working in our Sheffield office, predominantly with small and medium-sized industrial organisations, before moving into our deals practice, where I spent the majority of my career working with corporates and private equity houses, undertaking transactions here in the UK and abroad. I then relocated with my family, while still at PWC to the middle east, where I spent a number of years —I got quite a lot of exposure to the sovereign funds there—before moving back to the UK and into my current role.
My areas of expertise are flows of international capital and the deals market. I am not a specialist in national security matters.
Chi Onwurah
Thank you for sharing your expertise with us, Mr Jackson-Moore. What impact do you expect the measures in the Bill to have on the sovereign funds and others you represent—the investors and potential acquirers of UK assets? You said clearly that you were not an expert in national security—why should you be? —but how will you identify those acquirers who may be considered to pose a national security threat? What kind of engagement would you expect to have with the Department for Business in order to make that sort of call?
Will Jackson-Moore: That is a two-part question. On how the proposed Bill will impact the flow of capital into the UK, generally these are sophisticated investors who operate across the globe, investing in territories that already have equivalent legislation, so the actual legislation itself will not come as a surprise or a barrier. It is in the application of it that there will be concerns, in that, quite rightly, the definitions are drawn quite broadly and we believe that a significant number of transactions and inbound investments will be brought into this—in many cases, voluntarily, so people can get guidance. That will be an area of concern, in terms of whether it will create a barrier, either through publicity or with the timing of bringing capital into the UK. That is probably one of the main concerns right now.
In terms of sovereign funds, I am not in a position to say whether an individual investor or fund is a threat to national security. That is not something I would be looking to comment on.
Chi Onwurah
Q
Will Jackson-Moore: In terms of how we might engage with organisations on the applicability of the Bill, I think we would be asked questions about the industries that are covered, the definitions of an industry and what a business actually does. Whether an organisation is drawn into the legislation—whether it is considered a national security threat—is not something we would be involved in. I would be pointing organisations in the direction of their legal advisers on that.
As I said, there are something in the order of 6,000 investments into venture capital in the UK each year. There are approaching 10,000 mergers and acquisitions transactions a year in the UK, plus a number of infrastructure investments, and many of those will fall into the definitions within the Bill. I do not think it is entirely clear to buyers yet whether they would be caught. A traditional private equity house or a venture capitalist looking to invest in a start-up in the UK, may well be owned by Britons, with a management team who are British, but they may have structures that include overseas entities, and many of their investors will be overseas investors. I think that many of those organisations will be wanting guidance as to whether they will be considered an overseas acquirer, even though on the face of it they appear relatively British.
Chi Onwurah
Q
Will Jackson-Moore: No. The way traditional fundraising for a start-up or a transaction takes place is that a business is either put up for sale or seeks investment from a number of parties; the entrepreneur wants to raise finance and have a competitive situation in which the providers of capital are making the most attractive offers possible to reduce the cost of capital for the organisation. I think there would be an incentive for them to be able to say to potential investors, “We are not going to be considered as an asset that is important to national security”. The definitions are quite broad and many organisations will have technologies that right now appear relatively benign and are used for purely civilian purposes but are cutting-edge and on a trajectory whereby in two years’ time they may have military applications or other things that could be a threat to national security.
Chi Onwurah
Q
Will Jackson-Moore: Yes, in many cases it is a raising of finance for a partial stake. It is an entrepreneur looking to attract capital to expand their business, seeking to bring in an investor to provide maybe 25% of additional equity capital. They want to have a competitive situation where people are offering the most beneficial terms possible. Many of those investors will be overseas investors.
Nadhim Zahawi
Q
Will Jackson-Moore: For the vast majority of existing transactions, the existing legislation was not really a major factor; it only addressed a handful of transactions each year, whereas this is much more in the mainstream of the M and A market and therefore it will be much more on people’s agenda. We already have a number of organisations reaching out to us to understand the potential implications for ongoing transactions.
I do not think the timeframe in itself represents a barrier, since it is not that dissimilar to other jurisdictions, but again it is the application. If you look at Australia, for example, buyers have the ability to pre-clear themselves, and that type of amendment would be very helpful to ensure the free flowing of capital.
Stephen Flynn
Q
Will Jackson-Moore: Yes, it potentially could, because it will create an additional uncertainty. In order to attract capital, you need as much certainty as possible. An ability to say to investors that we do not believe we are in an area of investment that presents a national security threat is important.
Stephen Flynn
Q
Will Jackson-Moore: It is already having an effect, in that it is being discussed by organisations that are considering investments into the UK right now. People do not necessarily want to be seen as a guinea pig or have high-profile investments unless they really have to. It is not that it is stopping it; it is just another factor on the balanced scorecard as to whether you are going to make an investment. It is one factor to consider and it is a degree of uncertainty, which is never helpful.
Andrew Bowie
Q
Will Jackson-Moore: Not as the Bill stands in its own right. As you say, we are the largest inbound country for venture capital, for private equity and for infrastructure, and we have been seen as the gold standard for the location in Europe to invest into. Many other European territories have equivalent legislation, but again it is about the application of the legislation, in particular the process, the ability to pre-clear and the timelines actually being met. To understand some of these technologies is not going to be straightforward. These are emerging, cutting-edge technologies in some cases, and the talent required to assess that will not necessarily be easy to attract. Some consideration needs to be given to partnering with research institutes or academia in specific areas, so that there is a panel available to assess certain technologies, not only to understand its position right now but also its trajectory—where that technology may go in the next two or three years.
Stephen Kinnock
Q
Will Jackson-Moore: It is not something I have specifically considered. It certainly would not that be within what I considered to be a matter of national security under the auspices of the Bill. I do not think I am in a position to comment any further.
Stephen Kinnock
Q
Will Jackson-Moore: I am not in a position to talk about specific individual organisations. A number of sovereign funds in China are very well regarded in the international capital markets. However, in terms of their interaction with Chinese Government, that is not something that I have a perspective on.
Mark Garnier
Q
Will Jackson-Moore: As I mentioned earlier, the UK is the gold standard for a location to invest in, particularly within Europe. Investors like investing in the UK because of the fairness and transparency, UK law and UK courts, and as a place to be based and to live, so there is an inherent benefit to doing UK-based transactions. However, and as we sit here right now, on a scorecard-type approach, the UK is not as attractive a location as it has been historically. We have the uncertainties of Brexit and we have a number of other territories looking to recover and rethink their economies given the situation we are all in, so there will be more—
Mark Garnier
Competition?
Will Jackson-Moore: Yes, there will be more competition for international flows of capital. As I have said, I do not think this Bill in its own right fundamentally changes the attractiveness, but it does create another level of shorter-term uncertainty, just because people have not seen it operating in practice yet.
Mark Garnier
Q
Will Jackson-Moore: It is entirely appropriate to have legislation to protect matters of national security, so perhaps this puts us on a level playing field with other nations. But does it specifically enhance our position for the attraction of international capital? The answer is not specifically, but it sets a standard that the international capital markets expect us to put in place.
The Chair
We have no further questions from the Committee, so thank you very much, Mr Jackson-Moore, for your time and assistance. We are finishing slightly ahead of time, but I invite the Government Whip to propose to adjourn.
Ordered, That further consideration be now adjourned. —(Michael Tomlinson.)
4 pm
Adjourned till Tuesday 1 December at twenty-five minutes past Nine o’clock.
Westminster Hall
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Backbench Business
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Covid-19: Freedom of Religion or Belief
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Andrew Rosindell (in the Chair)
I remind hon. Members that they should sanitise their microphones using the cleaning materials provided before they use them, and dispose of the materials as they leave the Chamber. Members are also asked to respect the one-way system around the room. They should speak only from the horseshoe. Members can speak only if they are on the call list. That applies even if debates are under-subscribed. Members cannot join the debate if they are not on the call list.
Fiona Bruce (Congleton) (Con)
I beg to move,
That this House has considered the effect of the covid-19 pandemic on freedom of religion or belief.
It is a genuine pleasure to serve under your chairmanship, Mr Rosindell. Yesterday, 25 November, the world marked Red Wednesday, whose purpose is to draw attention to the plight of those who are persecuted for their religion and beliefs, and the International Day for the Elimination of Violence Against Women. To mark them, the all-party parliamentary group for international freedom of religion or belief tabled early day motion 1179. I thank colleagues who have already signed it, and I ask others please to do so. In that EDM, we urge the Government and the international community to act to mitigate the impact that covid-19 has had on vulnerable minority communities globally and on women and girls from them, who are doubly discriminated against because of their gender and their beliefs.
The chair of our all-party parliamentary group, the hon. Member for Strangford (Jim Shannon) led the call along with the hon. Member for Glasgow East (David Linden) to secure this debate. We thank the Backbench Business Committee for giving us time. The hon. Member for Strangford is unable to be with us today, and his compassionate voice will be much missed during this debate. As a vice-chair of the all-party parliamentary group, I am sure I speak on behalf of many of us when I express the most sincere thanks to him for his dedicated work for the persecuted.
I aim to highlight with examples from around the world how, tragically, both Government and non-state actors have exploited this global health crisis to violate human rights, and in particular the right to freedom of religion or belief. I will show how living conditions have worsened for those who are detained, whether in prison or as refugees, on account of their conscience. I aim to illustrate that the distribution of aid and humanitarian relief is often biased or withheld from those with minority beliefs, and I will speak of the spread of misinformation targeting minority religious or belief communities. There is clear evidence of an increase in violence, both domestic and more widely, affecting those with particular beliefs. I will demonstrate how, in other ways, the right to worship and manifest faith or belief has been curtailed.
All that illustrates how important it is for our Government to be vigilant in pressing others to uphold human rights and fundamental freedoms during this pandemic, including in particular the freedom of religion or belief. I look forward to hearing from the Minister how the Foreign, Commonwealth and Development Office in particular is doing so.
In countries around the world, many marginalised religious and belief communities have faced intensified discrimination since the outbreak of covid-19. According to the UN special rapporteur on freedom of religion or belief,
“Antisemitic hate speech has risen alarmingly since the outbreak of the COVID-19 crisis”.
Many faith communities have even been blamed for the virus. The BBC reported that in Somalia, the Islamic extremist group al-Shabaab is warning Muslims that Christians are transmitters of the disease. Such messaging is terrifying for the handful of Christians there who are already forced to practise their faith in secrecy for fear of their lives.
In India, Muslims faced accusations that they were deliberately spreading the virus and a campaign of Islamophobia, in which Muslims were labelled bio-terrorists and corona-jihadists ensued, leading to many instances of violence and discrimination against Muslims. For Christians in India, too, life has become more difficult during the pandemic, on top of a serious increase in anti-Christian violence over the last few years—I see the hon. Member for Glasgow East nodding—particularly but not exclusively in Uttar Pradesh.
We hear of problems in India of mob vigilantism, violence and surveillance of home churches by non-state actors. I thank the Backbench Business Committee, which has already approved a separate debate on the persecution of Muslims, Christians and other minority groups in India. I hope that parliamentary time will be found for that much-needed debate very soon.
The scapegoating of minorities during this pandemic is a truly global problem. According to the Institute of Development Studies:
“In a significant amount of the nations which have encountered outbreaks of the novel coronavirus, politicians and opinion leaders have openly condemned religious minority populations under the guise of epidemiological containment, through hateful messages on social media, public speeches and official policies.”
That scapegoating has contributed to the many reports of individuals from these communities around the world being attacked, denied aid or otherwise prevented from accessing life-saving humanitarian interventions.
Accounts of discrimination in food distribution and the biased distribution of humanitarian relief materials are widespread. Alliance Defending Freedom International reports from the Gulf region that people have become so desperate that they are forced to trade their religion for food—they are forced to convert to Islam for just one sack of flour.
In Iraq, there are reports of Christian communities being the last to get necessary food and medical supplies. In Pakistan, there have been reports of non-governmental organisations denying food and aid to Hindus and Christians, or serving only them after Muslims have been served. Some members of the ethnic and religious minority Hazara group in Pakistan have claimed that they need to disguise themselves if they hope to receive medical treatment or testing.
One of the problems is that where national Government aid is being distributed by local groups or where foreign organisations use local staff at the frontline of aid distribution, discrimination against minorities can occur at that point, regardless of the foreign organisation’s central anti-discrimination policies. It is important that our Government do what they can to call for mechanisms to be put in place to ensure that religious minorities at the frontline of aid distribution, particularly UK aid distribution, do not face additional discrimination because of their faith.
Certain states have also utilised the covid-19 outbreak as an excuse to intensify persecution of marginalised communities, and not only through church closures. In Uganda, there are reports that the Government’s response to covid-19 has systematically excluded religious minority groups, by allowing only certain major religions to attend consultative meetings on the coronavirus response.
China has increased its interference and surveillance of Tibetan Buddhists, under the pretence of attempting to tackle the coronavirus, even using contact tracing apps to monitor every movement of Tibetan citizens. Also in China, where the clampdown on freedom of worship over recent years has been alarming, the pandemic has sadly given an opportunity for state surveillance of religious worship by minorities to increase. Some church members who tried to meet for online worship were detained and had police stationed at their homes to prevent them from joining online services.
I turn to the plight of refugees and internally displaced persons. Many already live in overcrowded conditions, rendering them particularly vulnerable in the event of an outbreak of covid-19. Many are from religious communities who have experienced rights violations that occasioned their displacement and internment in the first place, such as the ethnic minorities who fled Burma’s decades-long years of conflict.
Covid-19 has reached the Rohingya refugee camps on the Bangladesh-Burma border, leading aid organisations to warn of an impending humanitarian disaster. First-hand observations by CSW—Christian Solidarity Worldwide—in the Rohingya refugee camps confirm that social distancing, self-isolation and even regular handwashing are an impossibility.
Elsewhere, the pandemic has highlighted failings in legal systems and criminal proceedings, and has underlined the degree to which religious discrimination can be institutionalised in some legal systems. In Sudan, for example, the legal system all but ground to a halt on account of the virus. Cases involving church leaders and church property, which were already proceeding slowly, faced further delays. Overcrowding in prisons during the pandemic has posed an additional threat to the welfare of inmates. A large number of prisoners are in Evin prison in Tehran, where conditions are overcrowded and unsanitary, and where prisoners have contracted the virus.
Eritrea is of particular concern; there, a stringent covid-19-related lockdown, enforced with violence by the armed forces, has provided the Government with an additional means of curtailing freedom of movement, which was already restricted. Tens of thousands of prisoners of conscience there, including long-standing Jehovah’s Witness detainees, are held in unsanitary, ill-equipped and life-threatening conditions, where insufficient access to water, food or medical facilities makes their plight desperate. An appeal by the UN special rapporteur for Eritrea for low-risk offenders and vulnerable prisoners to be released was rebuffed.
Although information from North Korea is difficult to obtain—I have the privilege of having been co-chair of the all-party parliamentary group on North Korea for some years now—last week there were disturbing reports about North Koreans with covid-19 being left to die in so-called quarantine camps. The full impact of covid in North Korea remains unknown, but we should not underestimate it, given that country’s virtually complete lack of respect for human rights, its limited health system and its concentration camps housing thousands of prisoners of conscience—all of which coincides with North Korea’s having suffered substantial food shortages this year.
The all-party group is currently conducting an inquiry into human rights violations in North Korea as a follow-up to the UN commission of inquiry of 2014. There is an opportunity to contribute to it through our website, appgnorthkoreainquiry.com, and submissions would be most welcome, particularly in the light of the limited information on the impact of the pandemic in North Korea.
Elsewhere across the world, it is clear that the pandemic has led to discrimination in employment. Open Doors reports having been told of Christian nurses being deliberately assigned coronavirus cases. When India went into lockdown to combat the coronavirus crisis, hundreds of thousands lost their jobs overnight. Many usually work as daily labourers and earn each day what they need to survive; without the day’s income they have no money to buy food.
Many work as sanitation workers. They are often from the Dalit community, which is the most neglected and marginalised in India—indeed, I would say, virtually in the world; it is heart-rending to hear how some of them can only come out at night. Their work involves great health risks, collecting waste, emptying sewage and cleaning the streets. We hear via Open Doors from Hyderabad how these people face a serious predicament and are putting their lives at risk, with even women sanitation workers performing these sanitation tasks without gloves, protective masks or even shoes, and often working by hand.
There is no financial safety net or furloughing scheme in India. Official aid is nowhere near enough for the people who need it and, sadly, Christians are often last in line for essential covid aid and food because of their faith. However difficult the pandemic has been in this country, these reports—I thank in particular CSW and Open Doors for their reliable and often first-hand accounts—show that the difficulties in other countries are further exacerbated for the vulnerable, minorities and women.
There is a second debate this afternoon on international development and gender-based violence, so I will not take any further time from other colleagues in this debate by focusing on it now. Suffice it to say that reports in The Lancet indicate that domestic violence against women and girls has increased by as much as 30% in some countries during the pandemic. This huge increase in domestic violence has led to several reports of women from minority communities, such as Yazidis, taking their lives.
Tragically, that increase in violence is by no means restricted to domestic situations during the lockdown. In Nigeria, villagers in Kaduna state and Plateau state were obeying state directives to stay in their homes to prevent the spread of the virus. Sadly, that made them even more vulnerable targets for attack than they were before the pandemic, because they effectively became sitting targets. Fulani militants have carried out multiple raids on villages, and there are reports that Christians have been killed. Christians believe that the militants are taking advantage of the pandemic to uproot them from the area, and although they have made efforts to alert security agents to the attacks, nothing has been done to prevent them. Once again, I call on the Government actively to address the concerns and recommendations of our all-party group’s report “Nigeria: Unfolding Genocide”, which was published earlier this year.
I look forward to colleagues’ contributions. Before I conclude, in the light of this debate, I ask the Minister to reflect on recommendation 21 of the Bishop of Truro’s report, about which I have spoken in a number of debates over recent years. The report highlights the importance of recognising the negative consequences of what he refers to as a “need not creed” mantra; of rejecting that mantra; and of the negative consequences of our aid being “religion-blind”.
Will the Minister consider the importance of challenging international partners to ensure that disinformation is combated; that there is access to justice; that where religious communities are attacked, there is accountability; that any emergency powers are proportionate; and—during this unprecedented crisis, now more than ever—that the needs of, and pressures on, religious minorities are taken into account, not ignored?
David Linden (Glasgow East) (SNP)
It is always a pleasure to follow the hon. Member for Congleton (Fiona Bruce), who opened the debate and set the picture rather eloquently. I commend my friend, the hon. Member for Strangford (Jim Shannon), who secured the debate at the Backbench Business Committee. Those of us who are Westminster Hall season ticket owners will know that the hon. Gentleman is not normally one to miss a debate, especially one on freedom of religion or belief. I know that I speak for us all when I say that we look forward to his return to the House to lead on this issue, about which he has spoken with so much passion and authority.
I also thank our friends at Christian Solidarity Worldwide, Open Doors and Aid to the Church in Need for their excellent briefings and their wider work on freedom of religious belief, not just during the pandemic, but before it. It has so often fallen to non-governmental organisations and charities to step into the breach and support religious minorities who face intolerable levels of persecution, and that has been compounded by the covid-19 pandemic.
One example of such practical support on the ground is the Open Doors covid-19 relief package, which is making a real difference in countries such as Nigeria and India. Every £56 donated equips a rapid response team to bring emergency food aid to a family of persecuted believers who are affected by the pandemic. That is vital because research shows that covid restrictions mean that many persecuted Christians have been ignored when aid is distributed.
To understand the challenges faced not just by Christians, but by other religious minorities, we can look at CSW’s excellent advocacy work and country profiles. On the situation for prisoners of conscience in Iran, overcrowding in prisons during the pandemic has posed an additional threat to the welfare of inmates and increases the likelihood of the virus spreading in those locations. A large number of prisoners of conscience are imprisoned in Tehran, in overcrowded and unsanitary conditions. By August this year, at least 25 people in the prison had contracted the virus, and on 10 August, several political prisoners staged a sit-in to protest their unsatisfactory conditions, inadequate protection measures and lack of medical care in prison. When the Minister sums up the debate, can he specifically say what representations the Government have made to the Iranian authorities about prisoners of conscience?
The pandemic has highlighted weaknesses and biases in legal systems and criminal proceedings. It has also underlined the degree to which religious discrimination is institutionalised—very much—in several legal systems. I will not repeat the point already made by the hon. Member for Congleton about the situation in Sudan, but we know that that is a particular concern there, so I ask the Minister whether the FCDO has raised it with the Sudanese authorities.
There have been notable occasions when authorities have misinformed or concealed information from the public in a bid to portray a more positive national image or, indeed, to create conspiracy theories that have adversely affected certain religious communities. There are examples in China, Laos and Vietnam, where people have been arrested for circulating information or rumours about the virus online and, in some cases, for simply questioning official figures or wondering why their respective Governments have not done more to contain the outbreak.
When Governments fail to provide adequate social services, humanitarian relief and healthcare, civil society—obviously and most notably, religious organisations—and individuals invariably attempt to fill the void. However, that can cause suspicion, and that leads to discrimination and even violence. There have been several incidents in Pakistan in which Christian and Hindu communities have been denied food by organisations, which stated that the relief supplies were only for members of the majority faith. Such discriminatory distribution of relief supplies has been reported in the Sindh and Punjab provinces; there have also been posters on mosques and madrassahs stating that food distribution is only for Muslims, which is of huge concern.
In my remaining time, I want to consider refugees and internally displaced people. Refugees and IDPs generally live in overcrowded conditions, which renders them particularly vulnerable in the event of an outbreak of covid-19. In some cases, those providing assistance, some of whom are religious actors, have been rendered vulnerable.
In May, it was confirmed that covid-19 had reached the Rohingya refugee camps on the Burma-Bangladesh border. The confirmation of at least two cases in the world’s largest refugee camp led aid organisations to warn of an impending humanitarian disaster. CSW has reported visiting the Rohingya refugee camps twice, and it is clear from its first-hand observations that social distancing, self-isolation and hand washing are an impossibility in camps in which families live cheek by jowl and with a limited supply of clean water, and poor sanitation and rudimentary healthcare. The same is true of the absolutely abominable concentration camps in which Uyghur Muslims are also being held. I therefore ask the Minister to comment specifically on camps, which are an enormous concern to us all on the all-party parliamentary group for international freedom of religion or belief.
Concerns about the impact on freedom of religion or belief during the pandemic are legion. I remain extremely concerned that the Government have yet to appoint a new special envoy for FORB at the Foreign Office. Ministers—indeed, the Minister in the Chamber today and, of course, the Prime Minister—have said repeatedly that an appointment will be made in due course, but that has not yet happened, which is a source of great concern to those of us who are following this in the FORB community.
Given the wide-ranging list of countries, referred to by me and by the hon. Member for Congleton, that are clearly violating freedom of religion or belief, this must be a priority for Her Majesty’s Government. I therefore look forward to the Minister summing up the debate and confirming when the appointment of a special envoy will be made and who will take forward this vital policy agenda.
Andrew Selous (South West Bedfordshire) (Con)
It is a pleasure to speak in these debates, but it is pretty grim that we have to keep having them. The bad news is that the situation continues to get worse and not better, which is why it is so important that we, who have the immense privilege of being able to speak out in the freedom that we enjoy in this country, do speak up for others around the world who do not enjoy the freedoms that we do.
I speak as a Christian myself, but I am here this afternoon to stick up for the Uyghurs in China and all people of the Muslim faith who are suffering persecution. In her excellent speech, my hon. Friend the Member for Congleton (Fiona Bruce) spoke about the persecution suffered by Dalits, which is absolutely unacceptable. We have heard of Hindus not being treated well in Pakistan, in terms of distribution of aid and so on.
This debate is about freedom of religion or belief, which of course includes the right not to believe in God. A very good Christian friend of mine, Ben Rogers, went to visit an atheist in prison in Indonesia a few years ago—a Christian going to the support of an atheist whose rights not to believe in God were being taken away. I seem to remember they had a very interesting conversation about Mark’s gospel—I do not know whether the atheist ever came to faith, as I never caught up with the end of the story. That just makes the point that, regardless of whether someone is of faith or no faith, this debate is for them. The right to freedom of religion or belief is universal and should be applicable all the way around the world.
Having said that, I note that—as the former envoy on this issue, my hon. Friend the Member for Gillingham and Rainham (Rehman Chishti), said in the main Chamber only this morning—Christians are the most persecuted group in the world. That is something that we just need to say, because we should speak as the facts dictate. In the more privileged west, we sometimes do not realise that most Christians in the world are quite poor and disadvantaged; they are not wealthy, privileged people. They are often at the margins and not in the mainstream, and it is easier to take advantage of them. Although I think, noting our manifesto, that yesterday’s decision on aid was unfortunately a regrettable one, I am grateful that combating persecution against people on the grounds of religion or belief remains a Foreign Office priority, which is very important indeed.
It is necessary to understand the context of the debate, because we will all mention some countries, which is absolutely right. I will read out the top 20 countries on the Open Doors 2020 world watch list, because they need to be named so that people are aware. No. 1 is no surprise, because it has been there for a long time: North Korea. Following that is Afghanistan, a country where there has been significant UK involvement for many years, then Somalia, Libya, Pakistan—a major recipient of UK aid spending and a Commonwealth country to boot—Eritrea, Sudan, Yemen and Iran. India, a proud member of the British Commonwealth and a great friend to this country, is at No. 10. I am a huge friend of India, but sometimes friends have the conversations that they need to have but do not always want to have. That is certainly the case with India, as a fellow Commonwealth member. No. 11 on the list is Syria. Then there is Nigeria, which is another Commonwealth country, followed by Saudi Arabia, the Maldives, Iraq, Egypt, Algeria, Uzbekistan, Myanmar and Laos. They are the top 20, which gives an idea of the geographical spread of this issue.
As I say, things are getting worse. Some 260 million Christians live in the world watch list’s top 50 countries—that figure has increased from 2019, when it was 245 million. In countries such as Sri Lanka, where there used to be a degree of stability, an increase in destabilising violence has led to much greater difficulties for Christians. In Burkina Faso, we saw a relentless rise in violence throughout 2019, and Islamic militancy has taken a hold within the country.
The situation continues to get worse in China, which has risen hugely in the world watch list, to No. 23. More than 5,500 churches have been destroyed, closed down or confiscated during the reporting period. In 2018, China was ranked at 43, so that is a huge increase. Many people were upset not to be able to get into our own churches earlier this year and in the last month or so, but what we have had to “suffer” is simply of a different order from 5,500 churches being destroyed, closed down or confiscated.
Fiona Bruce
My hon. Friend is making an excellent speech and highlighting that churches have been closed. Even where they are open, however, Government laws restrict who can attend them. For example, it is now illegal to take a child under 18 into a church and people in certain occupations, such as the military, cannot attend. In just the last few years, the restrictions in China have been incredible. I thank him for highlighting that again in this place.
Andrew Selous
I am grateful to my hon. Friend for that extra information, which she has usefully put on the record. I note that many leading campaigners in Hong Kong and many hon. Members on both sides of the House are inspired by their Christian faith to speak out against what is happening in Hong Kong.
In India, in 2019, there were 1,445 physical attacks and death threats against Christians. In Nigeria, in the 2020 reporting period, it was estimated that 1,350 Christians were killed for their faith, and abductions continue, often of children and young people. I was privileged to have Leah Sharibu’s mother in my office a few months ago. The pain in her eyes that her daughter has still not been returned to her encourages me to keep on speaking out on the issue.
I hope that this debate gets some publicity. I am generally a great fan of the BBC, but I cannot help noticing that debates on this issue do not always feature as prominently as they should on BBC outlets. I hope that will change and that this important debate will get some coverage.
Imran Ahmad Khan (Wakefield) (Con)
I thank my hon. Friend the Member for Congleton (Fiona Bruce) for securing this important debate. The covid-19 pandemic has drastically altered how we work, interact with one another and enjoy our lives. The manner in which we congregate in prayer has also drastically changed, causing some who have contacted me to question the state of freedom of religion in the United Kingdom. As I had hoped, this debate has provided the much-needed perspective to answer them by starkly contrasting the situation here with that suffered by untold millions around the world.
Under the terms of the present lockdown, which will last until 2 December, it is illegal for churches, mosques and any other places of worship to open for congregational prayer. All significant assemblies of people, however pious, whether that be at entertainment venues, sports halls or other arenas, have been severely restricted under the current measures.
Together with all God-fearing folk who are respectful of the law, I am relieved that it will not be a criminal offence to gather for worship in the new three-tier system in England following the current lockdown. Regardless, I do not believe that the measures undertaken by Her Majesty’s Government can in any way be construed as representing an attack on the freedom of religion or belief. Rather, they represent restricted access to gathered worship in the interests of public health. Although that is certainly not normal, the essence of religion remains free.
All people of faith should be united in the common belief that the only true way to worship and serve the Creator is to love and protect his creation. I would argue that the very act of following the Government’s guidelines, if the intention is to protect one’s fellow citizen, is in itself a meritorious act of worship.
During the height of the pandemic and the lockdowns, religious leaders transferred their sermons, prayers, studies and meetings to Zoom calls and other online video-conferencing platforms. Rather than access to religious services being limited, they have arguably become all the more accessible, and it is the same with a wide array of social interactions. Irrefutably, it has been neither the purpose nor desire of Her Majesty’s Government to exclusively target worship and religious houses in the fight against coronavirus. However, I appreciate that virtual congregation should never, and indeed could never, replace physical congregation or the feelings and experiences that mass gatherings bring to both an individual and the wider community.
Freedom of religion and the right to believe is actively under assault across the globe. In Pakistan, Ahmadi Muslims are systematically persecuted by the state. Ahmadis can be imprisoned or even sentenced to death for simply describing themselves as a Muslim or describing their mosque as a mosque. In China, as my hon. Friend the Member for Congleton mentioned, up to 1 million Uyghur Muslims, Christians and adherents of Falun Gong have been rounded up and placed in re-education camps, where they are subject to political indoctrination, forced sterilisation and violent torture. My hon. Friend has provided vivid and deeply distressing examples—a litany—of the crimes faced by those who wish to believe, and she described how such actions have been amplified by the perpetrators of such crimes owing to the covid pandemic.
The situation that we in the United Kingdom currently endure in our fight against covid bears absolutely no resemblance to the atrocities inflicted on religious minorities around the world. Freedom of religion here is enshrined and protected and has not been infringed by the state. Rather, temporary measures on access to places of worship have been regrettably implemented to control the spread of covid-19. Religious leaders, churches, synagogues, gurdwaras, temples, mosques and other places of worship have already proven their ability to provide a vital spiritual service to their congregation during the first lockdown through the use of technology.
I pray for the day when all the restrictions are lifted and worship can return to normal in the UK, and that all people, wherever they live in the world, are soon able, like us, to take as a given their right to live, work and worship as they choose without threat or fear.
Danny Kruger (Devizes) (Con)
It is a pleasure to serve under your chairmanship, Mr Rosindell. I apologise to you and to my hon. Friend the Member for Congleton (Fiona Bruce) for arriving after the start of her speech. I congratulate her and thank her for securing this important and timely debate.
I will not speak at length about persecuted minorities around the world, not having great experience on the topic, but I do have a powerful memory of visiting the Anglican church in Baghdad in 2003, just after the invasion of that country, with Canon Andrew White, who was the vicar of Baghdad and the Archbishop of Canterbury’s representative to the middle east. I tagged along with him on his first visit back to Baghdad after the invasion, and he reopened the church, which had been closed during the war, or during the invasion.
I remember the most joyful service. There were children running around and people from all walks of life, including American and British soldiers. I remember clearly the caretaker, who had looked after the church and kept it going through the invasion and the war. Within a couple of months of that visit, that man and his whole family were dead, and the whole church had been dispersed. That was the beginning of the persecution of Christians in Iraq, which led to pretty much the eradication of one of the oldest Christian communities in the world. That terrible scenario has been repeated across the world in all sorts of terrible ways, and not just affecting Christians, as we have been hearing.
The debate is about the pandemic and the role of faith groups, and I want to make two points in the light of that. The first is about how important faith groups are, as my hon. Friend the Member for Congleton has said, in reaching the poorest and working through their networks to ensure that support, whether with healthcare or with economic assistance during the crisis, reaches them. Obviously I entirely endorse everything that my hon. Friend said about standing against discrimination on the basis of faith in the developing world.
I also want to observe how important faith groups will be, in the developing world and at home, in countering misinformation about the vaccination programme that is beginning soon. I suggest that we need some religious literacy in working with faith groups and ensuring that misinformation is properly countered. Too often in our debates—frankly, in those about development as well as those about vaccination and misinformation—mainstream opinion seems to be that religion is part of the problem, and that if only people could be disabused of their fanciful superstitions it would be possible to convince them of what the science tells us. That is not going to help.
My hon. Friend the Member for Congleton talked about forced conversion. It makes me think about what we are asking people of faith to do. We are asking people who are suspicious of secular Governments, big companies and non-governmental organisations to abandon, effectively, what their faith says about those things and to undergo a vaccination that they do not believe in. We have to be much more respectful of them. I would put this, Mr Rosindell—I hope you will forgive me—in spiritual terms. The devil is in the structures of the world. There is injustice. There are bad people doing bad things, and people are victims of injustice through no fault of their own; but I do not believe that the Government—this is the argument we need to make—and big pharma or the NGOs are more particularly evil than the rest of us.
I will quote from Ephesians: “Our battle is not against flesh and blood, but against the principalities, against the powers, against the rulers of this dark age, and against the spiritual forces of wickedness in the heavenly places.” Our battle is not against people or organisations, but against spiritual forces, and that is the reality that people of faith hold, recognise and believe in. We have to help them to understand where the real enemy is. I suggest that the devil gets into the resistance to secular globalised organisations as well as into those organisations themselves, sowing distrust and spreading deceit. That can be seen in some of the malign forces that are operating in the way that disinformation is spread through social media. It is a spiritual battle and we need to respect people who think that way and not just tell them they are stupid.
My second point—raised by my hon. Friend the Member for Congleton—is about religious freedom at home. We closed churches through the lockdown, and I regret that. We effectively abolished the freedom of assembly throughout the country, and in all institutions. Okay, fair enough. We only overturned freedoms that were won 400 years ago, in that instance—but in closing churches we overturned the foundation of our constitution itself, which was laid 800 years ago. The first line of Magna Carta, as you will know, Mr Rosindell, is that the church in England shall be free. I suggest that it was unconstitutional for the Government to pass a law ordering the closure of churches for collective worship.
I note in passing that in answer to a written question from my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) earlier this month, the Government said that shutting churches was justified under article 2 of the European convention on human rights—that the right to life, interpreted as the right to health, justified the closure of churches. I am sorry that the ECHR has been held to trump Magna Carta.
I interpret what has happened differently. I think that churches shut voluntarily and were under no compulsion to do so. I respect the decision that they made to shut voluntarily, for the sake of closing down the pandemic. I am very pleased that the Prime Minister has said that churches can open for services after 2 December. Sadly, there will be no mixing outside people’s bubbles, which means no sign of the peace—a bit of a relief for some of us who do not like that bit of the service. But it is a shame that we cannot mix in churches. However, the principle that churches can remain open is vital—and I obviously extend that to all faith groups, and all communities of faith in this country.
David Linden
I am subject to similar regulations in Scotland. The hon. Gentleman has already quoted scripture from Ephesians, but it should be put on record as well that we are reminded that when two or more are gathered, he shall be present. The four walls of a church are just a building. When we come together in fellowship, whether that is by Zoom or on the telephone, we can still worship God.
Danny Kruger
I recognise that. The Holy Scripture was written for the age of Zoom. There is a sense that the church is the body of Christ, which is the people. However, it is established doctrine that the body consists of people gathering together. I appreciate that “two or three” gathered together is sufficient, according to the Bible, but I feel that the principle of collective worship being physical and the body of Christ being allowed to gather, in physical form, is part of our constitutional foundations.
I appreciate the opportunity we have had to discuss this subject and I endorse everything that my hon. Friend the Member for Congleton has said.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
As ever, it is a pleasure to serve under your chairpersonship, Mr Rosindell. I thank everybody who has made a contribution to the debate today. There have been some strong and powerful contributions.
I particularly commend the hon. Member for Strangford (Jim Shannon) for securing the debate, alongside others. Although he is sadly absent today, he has always been a steadfast defender in this House of the right to religious freedoms. I also thank the hon. Members for Congleton (Fiona Bruce) and for Glasgow East (David Linden) for leading the debate today and for their contributions. I thank the Second Church Estates Commissioner, the hon. Member for South West Bedfordshire (Andrew Selous) and I commend the Bishop of Truro’s report on the persecution of Christians that was referenced in the recent debate.
As a Christian myself, I was drawn last night to the words of the Gospel of Matthew about our responsibilities to the poor and the persecuted, particularly at this time:
“They also will answer, ‘Lord, when did we see you hungry or thirsty or a stranger or needing clothes or sick or in prison, and did not help you?’ He will reply, ‘Truly I tell you, whatever you did not do for one of the least of these, you did not do for me.’”
This is a most pertinent debate to have today, as we begin to understand the impacts of the Chancellor’s regretful breaking of the Conservative party’s manifesto promise and the commitment shared across this House, including by Members present, to 0.7% for international aid. The decision will have an impact on our work on crucial international issues, such as our work to protect freedom of religion or belief, and, more broadly, to support faith-based organisations and other non-religious but deeply ethically principled organisations in their work responding to the covid-19 pandemic and standing up for development, human rights and justice more broadly.
The hon. Member for Congleton particularly mentioned the situation for girls and for those persecuted around the world. We should reflect on the words of Malala Yousafzai, who was herself a victim of extremists in the Pakistan Taliban, who said this morning that she is deeply disappointed at the abandonment of the 0.7% target when a generation of girls are leaning on that support.
I spent yesterday speaking with a number of faith-based organisations and faith leaders working in South Sudan and Ethiopia. Their warnings were stark about the threats to peace, human rights and development in those two countries, with which we have had strong partnerships. They warned of famine, atrocities and disaster, on top of the impacts that covid-19 was already having on their communities.
I am sorry to say that it has been a deeply disappointing few months from the Government on these issues. Abolishing the Department for International Development already risked undermining UK leadership on freedom of religion and belief. As we know from a similar debate a few weeks back, the Prime Minister’s own special envoy on freedom of religion and belief, the hon. Member for Gillingham and Rainham (Rehman Chishti), resigned over the Government’s planned intention to break international law. Members do not have to take my word or the hon. Gentleman’s word for this. Earlier this year, the now former Minister of State for the Foreign, Commonwealth and Development Office, Baroness Sugg, responded to a debate in the other place on freedom of religion and belief. She rightly and proudly listed the work of the Department for International Development with the John Bunyan fund, which had funded an Institute of Development Studies-led programme on building religious freedoms. She said DFID had a director-level champion on those issues and was working in Rohingya refugee camps, and in many more instances besides, and that
“prioritising freedom of religion or belief can save lives and prevent humanitarian disasters before they emerge.”
She also said that
“withdrawal of our overseas aid will obviously affect the persecuted minorities and the very poor, whom we are aiming to help.” —[Official Report, House of Lords, 6 February 2020; Vol. 801, c. 1878.]
Ministers from the Foreign, Commonwealth and Development Office have spent the last month refusing to be drawn into discussing any specific spending commitments. Now we have had the Chancellor’s announcement, can the Minister tell us today which of the programmes supporting human rights, specifically on freedom of religion and belief, will be funded in the years ahead, and which will be cut? Beyond that, what role does the Minister see for faith-based organisations and other organisations of no religious principle but with deep ethical principles in our global development and human rights efforts?
Faith and religious communities have on the whole responded with responsibility, care and compassion to the pandemic at home and abroad. Responding to the Bishop of Winchester on 11 November, Baroness Sugg said faith groups
“have been incredible in their response to Covid-19. They are among the first to respond and can play an effective role in bringing about the behaviour change essential to slowing the spread of Covid and reducing infection and illness.”—[Official Report, House of Lords, 11 November 2020; Vol. 807, c. 1025.]
Across the Anglican communion—I declare an interest as a member of the Church in Wales—the impact of covid-19 on church life, which was mentioned by the hon. Members for Wakefield (Imran Ahmad Khan) and for Devizes (Danny Kruger), has been of the same order in the UK, with impacts on church buildings, the suspension of public worship, impacts on rites of passage, gatherings and so on. There has also been an impact on clergy. I know that will be felt by the leaders in many other faiths around the world. There is increased burn-out and stress as they seek to respond to the needs of their communities.
I have had some difficult conversations in my constituency with churches and other faith organisations, but—the hon. Member for Wakefield made some sensible points on this—there is a stark difference between what we see in this country and what we see abroad, from the wider threat of violence to the use of blasphemy laws. In many other countries, covid-19 restrictions have regrettably been manipulated to oppress religious minorities. Just a few weeks ago, in this place, we heard powerful examples of the persecution of Christians. That concern has been expressed by groups such as Open Doors and Christian Solidarity Worldwide. We have also seen antisemitism at the heart of many of the conspiracy theories about covid-19 in this country and abroad
In China, as we have heard, there is an ongoing attack on religious minorities by the Communist regime, including against Christians, Muslims, Buddhists, Taoists, and other religious and non-religious minorities. Catholic bishops have disappeared. Temples, statues, mosques and churches have been destroyed under the Government’s direction. The Uyghur Muslim population is facing a monstrous Government-co-ordinated programme of police surveillance, enforced re-education, disappearances, internment and mass detention. We have even heard reports of forced sterilisation. Of course, 1 million Uyghur Muslims may have been living in camps since April 2017. The risks of that in relation to covid-19 are obvious.
The situation in India was mentioned, where Muslims are demonised by wild conspiracy theories that blame them for the spread of covid-19. Members of some Islamic movements were quarantined despite not having been at risk or having symptoms. In Pakistan, as was mentioned by the hon. Members for Glasgow East and for Wakefield, Christian and Hindu communities were denied food aid by organisations that stated that relief materials were only for members of a majority faith. We have seen attacks and discrimination against the Hazara minority and baseless allegations against them for being involved in the spread of coronavirus. The longstanding persecution of the Ahmadi population has continued in Pakistan and elsewhere.
Where prejudice existed before the pandemic, it has also had a significant impact on testing and tracing. In South Korea, where an outbreak occurred among members of one particular church, other members refrained from testing to avoid discrimination because they are seen as heretical by other Protestant South Korean churches. The Sufi religious community is persecuted in Iran. In Sri Lanka, the Muslim community’s rights on burial practices have been suppressed. The pandemic has affected rights and freedoms of the non-religious, too. Humanists International made some powerful points about the impact on the humanist movement, and the impact of lockdown on those being forced into religious practices when they hold no such religion and the impact that has had on them and their communities.
Labour stands firmly by our international human rights obligations, including on freedom of religion or belief. Everyone has the right to freedom of through, conscience and religion. The necessary restrictions in the UK because of the coronavirus pandemic have meant difficult times around Easter, Ramadan, the Jewish high holidays and Diwali. People are now thinking about how they might celebrate Christmas and Hanukkah in limited circumstances. We all face challenges, but in far too many places globally, necessary limitations have been superseded by discriminatory and oppressive measures, using public health to cover up persecution and the whipping up of hatred.
Like many others in this debate, I am a person of faith. My Christian beliefs very much underpin why I went into the humanitarian development sector before I came into this place. I want to return briefly to the point about the 0.7% commitment. I could not agree more with the Most Reverend Primate, the Archbishop of Canterbury, who described the move yesterday as “shameful and wrong.” I am reassured by the many Conservative and other Members who had the courage to speak out yesterday and today. This is an issue that transcends party politics. It is about right and wrong, and it is about Britain’s national interests.
It matters to this debate, too, because when we talk about a global Britain standing up for freedom of religion and belief and getting behind the incredible efforts of organisations of religious faith and non-religious principle—whether that is directly combating persecution, supporting persecuted communities or supporting communities with the material needs of those affected by conflict, gross poverty, inequality and now covid-19—it cannot just be about words.
Christians often turn to the story of the good Samaritan, but I am reminded of the words of Christ himself in the gospel of Mark, recounting the parable of the widow’s mite. He says:
“He sat down opposite the treasury and observed how the crowd put money into the treasury. Many rich people put in large sums. A poor widow also came and put in two small coins worth a few cents. Calling his disciples to himself, he said to them, “Amen, I say to you, this poor widow put in more than all the other contributors to the treasury. For they have contributed from their surplus wealth, but she, from her poverty, has contributed all she had, her whole livelihood.”
That is the example set by many faith and non-religious organisations worldwide. As a country, we cannot just be a fairweather friend to the persecuted and the poor when we have plenty. Britain is better than that.
The Minister for Asia (Nigel Adams)
It is a pleasure to serve under your chairmanship today, Mr Rosindell. I congratulate the hon. Member for Glasgow East (David Linden) and my hon. Friend the Member for Congleton (Fiona Bruce) on securing this debate, and I commend them for their long-term commitment to freedom of religion or belief. I agree with my hon. Friend that these debates are not quite the same without the hon. Member for Strangford (Jim Shannon)—nor is any Adjournment debate, for that matter. As my hon. Friend said, his passionate voice has been sadly missed from today’s debate, but I am sure, via the miracle of the internet, he will be tuning in to the debate. We wish him well in his isolation.
I also thank hon. Members for their ongoing work with the all-party parliamentary group, which continues to raise the profile and awareness of human rights to parliamentarians and the public alike. Like my hon. Friend the Member for South West Bedfordshire (Andrew Selous), I very much hope that today’s debate gets picked up and gets some publicity. It is an issue that is debated regularly in Westminster Hall and in the main Chamber, because it is important to so many colleagues.
The pandemic continues to have a huge impact on countries and communities around the world. In this time of stress and uncertainty, religious and belief actors have a role to play in providing social and humanitarian services. Meanwhile, Governments must work with those actors to increase community cohesion and resilience, as well as to communicate important public health messages. Let me take this opportunity to reaffirm our unwavering commitment to championing freedom of religion or belief for all and to promoting respect between different religious and non-religious communities.
[Steve McCabe in the Chair]
Freedom of religion or belief is a long-standing priority for this Government. Lord Ahmad, my ministerial colleague, continues to champion the cause as Minister for human rights at the FCDO. Religious intolerance and persecution are often at the heart of foreign and development policy challenges. Where freedom of religion or belief is under attack, other human rights are also threatened.
The FCDO is using all its diplomatic tools to ensure that nobody suffers because of their conscience. Nobody should be excluded because of their religion or belief. Discrimination not only damages societies, it holds back economies. Countries cannot fully develop while minorities are oppressed and communities are invariably stronger when they include everyone.
Development and diplomacy work hand in hand, and the FCDO is working on two particular freedom of religion or belief programmes: one is an Institute of Development Studies project, working with minority groups in Africa and Asia; and the other, with the University of Oxford and parliamentarians in nine countries, is working to reduce the use of language that intimidates minority religious groups during elections. That work is vital to advancing freedom of religion or belief.
The pandemic has undoubtedly brought out the best in many religious and belief communities around the world. We have seen remarkable acts of kindness, not least in the UK, including enhanced efforts to care for the vulnerable and actively sharing credible advice on health and safety precautions. Notwithstanding the overwhelmingly positive example set by many communities, we remain deeply concerned by the severity and scale of violations and abuses of freedom of religion or belief in many parts of the world, as has been raised by hon. Members today, including a worrying increase in hate speech and the rising conspiracy theories that certain faiths or beliefs are to blame for the pandemic. We have heard examples of that today. Such incidents are completely unacceptable. The United Kingdom will continue to refute those divisive and harmful claims. No one should suffer in the pandemic because of their faith.
To ensure that the issue is not forgotten in these most challenging of times, we have stepped up our engagement at the United Nations and in other multilateral forums to ensure that freedom of religion or belief remains a top priority for all countries. In June, Lord Ahmad urged states to take steps to mitigate the impact of covid on the most vulnerable and disadvantaged members of society, including religious and belief minorities, during the UK’s closing statement at the 44th session of the UN Human Rights Council. Just over a fortnight ago, we demonstrated our concern about the rise of antisemitism, which has been mentioned today, and other forms of discrimination in the wake of covid, in our statement to the UN General Assembly.
We will continue to use our influential voice to raise freedom of religion or belief at the UN, including urging the international community to work together to face the challenges presented by the pandemic. We have also issued a joint statement with the International Religious Freedom or Belief Alliance, calling on states to ensure that any restrictions to the right to freedom of religion or belief are necessary, proportionate and time-limited to protect public health. Last week, Lord Ahmad attended the alliance’s Ministers forum, where he urged renewed efforts to prevent acts of violence that target individuals on the basis of their religion or belief.
It is particularly important at this time to ensure that the most vulnerable and disadvantaged members of society are actively included in response and recovery efforts. As we have heard today from all hon. Members in this Chamber, members of minority communities are suffering terrible discrimination and abuse throughout the world, so our work in the multilateral forum must be informed by what is happening on the ground. In Pakistan, for example, hate speech and attacks have been aimed at Shia Muslims and Hindus, and Christians are being denied food, support and healthcare. We continue to urge the Government of Pakistan to ensure that all citizens enjoy the full range of human rights, as laid down in Pakistan’s own constitution, enshrined in international law and demanded, frankly, by human decency.
We are also concerned by the rise of anti-Muslim sentiment and the decision by the Sri Lankan Government to mandate cremations for all those deceased due to covid—Lord Ahmad has raised that issue with the high commissioner. Ministers and officials at the high commission in Colombo continue to urge the Sri Lankan Government to ensure the protection of Christians, Muslims and other minorities in that country. In Iraq, covid has had a significant effect in the regions of the country formerly controlled by Daesh, including on religious minorities such as Christians and Yazidis. Many still remain in camps, where covid is leading to reduced services, and those outside the camps are struggling with livelihoods and access to essential services.
I will now address some of the more specific issues raised by hon. Members. My hon. Friend the Member for Congleton was absolutely right to raise Red Wednesday. I can confirm that the FCDO was lit up in red lights to demonstrate our solidarity with persecuted Christians across the globe. We will continue to work across Government to ensure that these international days are respected in the appropriate manner. She rightly raised cases of oppression of those of faith and other minorities across the globe. She cited evidence of some states allegedly, or actually, using the pandemic as an excuse to clamp down on minorities. She raised, as did other hon. Members, the plight of the Rohingya in refugee camps. I am proud of the work that we are doing to alleviate the suffering of the Rohingya. We are the second-largest donor of relief and support to those people, both in Bangladesh and in the camps.
My hon. Friends the Members for Congleton and for South West Bedfordshire spoke of North Korea. It is very difficult to assess the situation there, as they can imagine. Due to the pandemic, we have had to take the difficult decision to close our embassy in North Korea temporarily, basically to give our dedicated staff there some relief from the situation—they literally could not go out of the perimeter of the compound they were staying in. We took that difficult decision, but we hope to be able to return to that country at the earliest opportunity.
Andrew Selous
When the Foreign Secretary made his very welcome statement about Magnitsky sanctions, North Korea was one of the countries raised. He mentioned organisations, because it was not possible at that time to identify the individuals who led them. Has there been any progress in identifying the individuals concerned, to whom those Magnitsky sanctions will apply in North Korea?
Nigel Adams
My hon. Friend is right to mention sanctions. These Magnitsky-style sanctions can have great effect in holding people to account, especially those with assets outside particular countries. He will appreciate that it would not be correct to speculate on individual names—to do so would likely lessen the effect of any potential sanctions—but what I can tell him is that we are constantly monitoring potential individuals for our sanctions regime.
My hon. Friend the Member for Congleton mentioned the Bishop of Truro’s report. We have made great progress in adopting those recommendations. On recommendation 21, which focuses on sharing lessons from the implementation of the review’s recommendations, we continue to consider the best way to do that. We will implement them over the next 18 months, as we have committed to doing. We are very grateful to the bishop for his review. My hon. Friend also mentioned India. We are very concerned about reports of discrimination against minorities there, which is linked to covid. We condemn any form of discrimination based on religion or belief. India’s strength, like that of the UK, is in its diversity. We call on and trust India’s Government to address the concerns of peoples of all religions.
The hon. Member for Glasgow East rightly raised Sudan. Our embassy in Khartoum constantly monitors the human rights situation there, including on freedom of religion or belief, through engagement with civil society and their politicians, and we raise our concerns with authorities. Most recently, on 28 January, Lord Ahmad raised the importance of freedom of religion or belief with the Sudanese ambassador, including concern at the appalling burning of three churches in Blue Nile state. Lord Ahmad stressed the need for the Sudanese authorities to investigate that incident. We are undertaking project work to strengthen the effectiveness of the Sudanese National Assembly. This includes ensuring Sudanese policies and legislation better serve minorities and religious groups, in line with international standards on freedom of religion or belief.
Lord Ahmad also raised the issue of discrimination towards and the targeting of the Baha’i community in Iran. We regularly raise specific concerns about laws that might end up discriminating on the basis of religion or belief, and we do so publicly and privately—we make a judgment on which we believe will have the most positive effect. He also mentioned a replacement for the special envoy. I again pay tribute to my hon. Friend the Member for Gillingham and Rainham (Rehman Chishti) for his work in that role. The Prime Minister will be appointing a special envoy replacement in due course.
David Linden
I have a lot of respect for the Minister, but I am getting slightly fed up with hearing the words, “in due course”, which I know are a favourite of the civil service. Can he at least commit to saying that the appointment will be made before Christmas? Given how often we are in this Chamber raising these issues, it is rather frustrating to be told that they will be raised “in due course” when this does not actually happen.
Nigel Adams
I understand where the hon. Member is coming from. This is a bigger point. This is not something that needs to be rushed. There will be a replacement, but by no means are we stepping back from our commitment to this role. We know how crucial it is for liaison with the all-party parliamentary group for international freedom of religion or belief. However, the hon. Gentleman must forgive me if I cannot give a commitment on whether the appointment will be made this side of Christmas, however welcome that would be.
My hon. Friend the Member for South West Bedfordshire is a long-time champion for freedom of religion or belief. He rightly highlighted a wide range of countries where there are serious concerns about the ability to worship freely. We will always condemn any form of discrimination. We will always raise our concerns directly with the countries. He focused on China and the Uyghur population. We are deeply concerned about the human rights situation in Xinjiang. We all know about the so-called re-education camps. Our diplomats have visited Xinjiang periodically to observe that situation, because first-hand access is not easy.
We have repeatedly taken an international role in holding China to account on the issue, including statements at the UN Human Rights Council in June and in the UN Third Committee last October. At the time, the UK was the only country to have led a joint statement at the UN. On 6 October, the UK and 38 other countries made a statement at the UN Third Committee in New York, expressing our deep concern about the situation in Xinjiang, including the mass detention of Uyghurs. This reflects our diplomatic leadership internationally, including the personal involvement of the Foreign Secretary, in raising the issue with a wide range of partners.
On 25 September, we devoted our item 4 national statement to human rights issues in China at the UN Human Rights Council. That was only the second time the UK has dedicated its national statement to a single country—the first time was in 2018, on Russia, following the Salisbury poisonings. In July, the Foreign Secretary raised Xinjiang directly with his Chinese counterpart, Foreign Minister and State Councillor Wang Yi. I raised my concerns directly with the Chinese ambassador in March.
As usual, my hon. Friend the Member for Wakefield (Imran Ahmad Khan) spoke eloquently on a subject that is very close to his heart. His experience of the discrimination that he has suffered as an Ahmadi Muslim makes him uniquely placed to comment on these injustices. As my hon. Friend the Member for Devizes (Danny Kruger) said, we all look forward to being able to worship to some degree in the UK after 2 December, in all places of worship. Collective worship is clearly preferable to services via Zoom, but that is a step in the right direction at least.
My hon. Friend the Member for Devizes also talked about his personal experience in Iraq. The suffering of Christians and many other groups in Iraq is a matter of serious concern. We are firmly committed to protecting members of religious minorities in Iraq and providing assistance on the basis of need, irrespective of race, religion or ethnicity. We have committed £261 million in humanitarian support to Iraq since 2014, which will provide a vital lifeline of food, shelter, medical care and clean water for the most vulnerable, including the Yazidi and Christian minorities. We have also contributed £23.15 million to the UN development programme funding facility for stabilisation, which works to restore vital services across liberated areas of Iraq, and is heavily committed to areas that are home to minority communities—principally, and historically, those are Christian areas.
The hon. Member for Cardiff South and Penarth (Stephen Doughty) brings great experience in this area to his role as Opposition spokesman, and it is always good to see him across the Chamber in these debates. He rightly raised the issue of the reduction of the development assistance budget from 0.7% to 0.5%, but the pandemic has had a huge and severe impact on our economy, which has fallen to the worst levels in 300 years. That has forced us to take an incredibly tough decision to spend 0.5% of our national income on global poverty reduction next year, rather than the usual 0.7%. That was a very difficult decision to make, but it is a temporary one. We must protect the economy during the pandemic, but we intend to return to 0.7% as soon as possible.
Of course, we remain one of the most generous G7 donors: proportionately, we will spend more than the United States, Japan, Canada or Italy. In real terms, that means more than £10 billion to fight poverty, improve global health and achieve our UN sustainable development goals.
Stephen Doughty
I take the Minister’s sincerity, but those are political choices that the Government have made in breach of their own commitments. A lot of organisations, particularly those working on the crucial issues that we have debated, want some of the granular detail on which programmes will be cut, suspended, changed or altered. The Foreign Secretary just mentioned in the main Chamber that there will be another review over the next couple of months. When can we expect detail and confirmation of funding for the critical programmes that we have discussed?
Nigel Adams
The hon. Gentleman is right to ask. All aid will be focused on seven global challenges where we can make the most difference: covid and global health security; girls’ education; science, research and technology; conflict resolution; humanitarian preparedness and response; trade and economic development; and, of course, climate change and biodiversity. The Foreign Secretary will decide the allocation of aid to other Departments in line with those objectives. All the projects will be assessed through a new management process, led by the Foreign Secretary with input from Ministers about their geographic and departmental responsibilities. That will be laid out, although I hate to use this term, in due course. The hon. Gentleman will have heard the Foreign Secretary’s commitment on that.
David Linden
The Minister is being extremely generous. I hope that he will reflect on David Cameron’s tweet yesterday about it being a regrettable move, given that we share the world with some of the poorest people. It was a deeply retrograde step. Global Britain is not a project that I and the SNP endorse, although I wish it well, but as Britain emerges from Brexit and goes on to the world stage, it strikes me that moving from 0.7% to 0.5% is not good for global Britain’s soft power. Even at this late stage, the Government should reconsider, because it looks so bad for project global Britain.
Nigel Adams
The important thing is that whatever aid we give, it has the greatest possible impact overseas. I heard what former Prime Ministers had to say yesterday. Nobody wanted to have to make that decision, but these are extraordinary times. There has been a severe impact on our economy. We will still be the second largest donor in the world in that area.
I would also say that we have managed to achieve 0.7% in previous years. We will be cutting it back to 0.5% temporarily, but I politely say to the hon. Member for Cardiff South and Penarth that in 13 years in government, the Labour party never once achieved 0.7%. Not only that, it did not achieve 0.6% either. In two years, it achieved only 0.5%. We are, temporarily, going back to where we were at 0.5%.
Stephen Doughty
The Minister has made that point, and the Foreign Secretary tried to do the same earlier. When they resort to such personal points, it reflects a Government in wider difficulties. The reality is that in 1997, ODA was at something like 0.21%, and by the end of the Labour Government it had come close to 0.6%. There was a steady increase throughout the period after the Thatcher Government, the Pergau dam scandal and many other things.
Rightly—and I have credited them for it—David Cameron, the right hon. Member for Sutton Coldfield (Mr Mitchell) and others stuck with the commitments and the increases, because there was cross-party consensus. It is a great regret that the Government, and the Chancellor in particular, have chosen to break that consensus. It is deeply regretted by many on the Minister’s side of the House, as he knows.
Nigel Adams
It is regretted right across the ministerial team, but such measures have been forced on us by the pandemic. It is a temporary measure.
Imran Ahmad Khan
The Minister mentioned a commendable list of seven areas that will now be the FCDO’s core areas of funding, but I noticed the absence of a vital one. Although he mentioned conflict resolution, there was no mention—unless it is a sub-category of that—of upstream conflict prevention. That is certainly the most cost-efficient and best way to stop conflicts occurring, and it is an area in which the United Kingdom has an incredibly valuable asset.
I used to be an active member of the Oxford Research Group with Sir Malcolm Rifkind, Gabrielle Rifkind and Tim Livesey, who used to be the chief of staff of the right hon. Member for Doncaster North (Edward Miliband)—it is multi-party. It has a great arsenal of talent and people that it can employ for the sake of security elsewhere. If upstream conflict prevention is not included, are we selling Britain short?
Nigel Adams
I do not believe so at all. It is important to be mindful of all areas. Prevention of anything is better than cure in many ways and less expensive. My hon. Friend makes a hugely important point. We need to strengthen democratic institutions to ensure that these things are headed off. We need to ensure effective governance and free media as part of protecting human rights. All those things are positive contributors.
The effects of the pandemic have been overwhelming and far-reaching, and will continue to have an impact on our lives for some time to come. As a longstanding champion of human rights and freedoms, the UK has a duty to defend our values of equality, inclusion and respect at home and abroad. I thank all hon. Members for their excellent contributions and for the debate that we have had on the issue of the day. I assure the House that the Government will do just that: whatever obstacles lay in our path, we will continue to raise awareness of those who are persecuted for what they believe, stand up for the rights of minority communities around the world and defend the right to freedom of religion or belief for everyone everywhere.
Fiona Bruce
I thank the Minister for his detailed response and for confirming the Government’s increasing engagement on the issue of freedom of religion or belief. I have seen that over the past 10 years, and it is genuine—particularly on the part of the FCO. I think there is a bit of catch-up on the part of the Department for International Development, but I am hopeful that now the two are working together, we will see that increasingly.
I thank hon. Members for their contributions. The hon. Member for Glasgow East (David Linden) mentioned the envoy appointment, and I think that, after two months, he is right. The Minister talked about Lord Ahmad making representations—for example, at the UN—but the role of the envoy was separated from the Foreign Office Minister’s role more than a year ago because it was felt that we needed to send a signal to the international community and have an individual dedicated to making representations on behalf of our country. I concur with the hon. Gentleman’s comments: that appointment needs to be made soon.
My hon. Friend the Member for South West Bedfordshire (Andrew Selous) spoke of the wide range of countries where there are restrictions of freedom of religion or belief. Concerningly, some of the worst are Commonwealth countries: Pakistan, India and Nigeria.
My hon. Friend the Member for Wakefield (Imran Ahmad Khan) reminded us that although collective worship has been restricted in this country, freedom of religion has not been. In fact, the use of online technology has perhaps extended the opportunity for people to engage over recent months.
My hon. Friend the Member for Devizes (Danny Kruger) made a characteristically intelligent speech. I wish I had more time to engage with the comments he made. He talked about the importance of faith communities and the contribution they can make. He is absolutely right. DFID began to recognise that during the Ebola crisis in Sierra Leone, where deaths could have been prevented if there had been greater engagement with faith communities. He spoke of the importance of religious literacy. Yes, there is now a toolkit for the FCO, but are DFID staff being asked to look at that? That is really important.
Finally, my hon. Friend talked about the subtle issue of DFID having over the years claimed to be religion-blind. Actually, in seeking not to discriminate and in seeking to be fair, it has denied the fact that, as I hope we have demonstrated, religion is often an exacerbating factor in aid need, and needs to be taken into account rather than ignored when aid is distributed.
The hon. Member for Cardiff South and Penarth (Stephen Doughty) commended the response of faith groups to covid-19. The APPG on faith and society published a report in the past few days on how, here in this country, local authorities are working much better with faith groups. It is a very encouraging report, and I hope it can be looked at by DFID, in terms of our international aid work. There is a lesson that could be learned there. The hon. Gentleman also mentioned the John Bunyan Fund for Freedom of Religion and Belief, but I am a little concerned that there has not been much information about what it applies to.
Motion lapsed (Standing Order No. 10(6)).
International Development and Gender-based Violence
(4 years, 1 month ago)
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Anthony Mangnall (Totnes) (Con)
I beg to move,
That this House has considered international development and gender-based violence.
Thank you for being here, Mr McCabe; it is a pleasure to serve under your chairmanship.
I do, however, take very little pleasure in debating today’s motion. Gender-based violence is a scourge upon the world that has devastating and lifelong implications for survivors. At its core, gender-based violence refers to harmful acts directed towards an individual, based on their gender. It occurs because of gender inequality, abuse of power, and harmful and outdated norms. While it is predominantly directed towards women and girls, it also impacts men and boys. Across the world, millions suffer from these appalling crimes, all too often in silence. It is estimated that one in three women will experience sexual or physical violence in their lifetime—a statistic that is considerably worsened during conflicts, displacements, and at times of crisis.
Gender-based violence comes in many forms, and can include sexual, physical and mental abuse, as well as harassment, coercion and manipulation. It is domestic abuse, it is sexual violence in conflict, it is child marriage, it is female genital mutilation and it is honour crimes—the list goes on. Such acts take place both in private and in public. Its prevalence has only increased over the course of this year as a result of the pandemic.
At the start of this year, the United Nations estimated that 242 million women and girls were subjected to sexual or physical violence in the preceding 12 months—another statistic that will only have increased over the course of this year.
Such acts are used as an effective tool to ostracise individuals, to exert power over others, and to spread fear and subjugation into communities and individuals. As is outlined in Human Rights Watch’s latest report, “They Treated Us in Monstrous Ways”, which documents crimes of sexual violence against men in Syria by both state and non-state actors, such actions are now commonplace in conflict zones and crises. Rape and sexual violence are effectively being used as weapons of war—a weapon that costs nothing to the perpetrator and everything to the survivor.
As was detailed by ActionAid in 2007, over 87,000 women and girls were intentionally killed. That equates to 137 a day. These are the numbers that we know of; millions more are likely to be suffering in silence, locked behind closed doors and subjected to horrors that are unimaginable to any of us.
As nation after nation entered lockdown and schools were closed, offices shut and places of public interaction and engagement sealed off, so too were places of safety. Millions of people were denied access to those areas where they might briefly find some degree of normality and peace from their perpetrators. The United Nations estimated that in the six months of lockdown, there would be 31 million cases of gender-based violence—just over 5 million a month.
With the closure of schools, millions more girls, no longer able to access an education, will be forced into child marriage. The full impact of covid-19 will not be known for quite some time, but what we know now is a small glimpse of how widespread and prevalent this issue has become. Gender-based violence is a pandemic within a pandemic.
Yesterday was notable for two reasons. First, it was the UN International Day for the Elimination of Violence against Women. Secondly, the United Kingdom announced its decision to cut our international development budget. In honour of the UN International Day for the Elimination of Violence against Women, I launched an international statement that was supported by parliamentarians from this Parliament and nine others. The statement called for the protection of funding for programmes to tackle all forms of gender-based violence at home and abroad, working together to find new ways to support women and girls at risk of gender-based violence and ensuring that women leaders are at the heart of our response to gender-based violence. I would be grateful to the Minister if he would let the House know whether he supports that statement, as I think nearly every other Member here has signed it.
On this, the second day of 16 days of activism to eliminate violence against women, we are holding this debate and hoping to ensure that the UK does not shirk its international responsibilities to help some of those in the most difficult situations across the globe. I find it difficult to understand how the UK can take such a short-term approach to our international obligations, reputation and moral duty by cutting the development budget from 0.7% to 0.5%. It may well have been billed as a temporary measure to deal with an unprecedented financial situation, but so too was income tax. I will, therefore, not be holding my breath.
I hope I am not considered to be overly idealistic in believing that the UK is internationally recognised for the work that we do through our development budget. It is aid that is given for no other intention than to support the most vulnerable and those who are suffering. So much of what has been said in the past 24 hours focuses on the financial cost, rather than the enormous benefit of the support and humanitarian assistance that we send across the globe, from the 6 million girls provided with decent education to the almost 52 million people who have been given access to clean water or the 76 million children who have been vaccinated. That is all in the past five years. Our aid budget has made a difference to vulnerable women and girls across developing economies.
I will do all I can to see the return to 0.7%. For the purpose of this debate, however, I wish to point out that in previous spending rounds of our development budget, spending on GBV has ranked at the lowest level. Of the £14 billion spent on international aid, just 0.3% is spent on ending violence against women and girls. That must be rectified. I ask that the Government consider ringfencing 1% of the 0.7%—apologies, I mean 0.5%—to ensure long-term funding and commitment to tackling gender-based violence and supporting those who are so often overlooked, left behind and ignored.
None of us will look back on 2020 fondly, but it has been an important year for several reasons. It is the 20th anniversary of the UK’s signing UN Security Council resolution 1325 on women, peace and security, and the first year of the decade of action on the sustainable development goals, focusing on action on gender and women’s empowerment. It is the 25th anniversary of the Beijing declaration and the platform for action. While we might reflect on how far we have come since signing those commitments to tackle these issues, we might also reflect on how far we have yet to go to end gender-based violence and to reach gender equality.
Fortunately, I am an optimist—I have to be an optimist—and I believe that the UK can still achieve its commitments and maintain some semblance of its international reputation. As chair of the all-party parliamentary group on the preventing sexual violence in conflict initiative, I have consistently asked the Government to introduce an international body, to be based here in the United Kingdom, to collect and document information on sexual violence in conflict, support survivors and lead international prosecutions against those who commit atrocious crimes such as sexual violence in conflict.
We can shatter the culture of impunity, and with President-elect Biden soon to take office, we have a unique opportunity to implement an organisation that would support so much of the work that he accomplished on women’s rights as a Senator. Some might question why I have decided to take up this issue, but for me it is obvious. If men are 99% of the problem, we have to be 50% of the solution, and as the Voluntary Service Overseas points out, change will only work when men change their attitudes to violence towards women and girls.
A new era of activism and education is needed, and it can be led by the Foreign, Commonwealth and Development Office and supported by the development budget. I hope the Minister will work with me and others in this Chamber to develop that programme and to ensure that this issue is firmly on the agenda at each and every international event.
With that in mind, next year the UK is set to host the G7, and the Prime Minister will undoubtedly include his women’s education initiative on that agenda. I urge the Minister—and the Prime Minister, if he is watching—to also include on the agenda gender-based violence and preventing sexual violence in conflict. If we are to succeed in supporting more women into education, we need to address gender-based violence. They are interlocked pieces of the same jigsaw, and success cannot be had in one without the other.
The Government have launched some truly brilliant programmes, such as What Works to Prevent Violence: Impact at Scale, and put more than £67.5 billion of funding into it, but they can and must go further. They must build on the funding, build on access to services, and build on access to police action, justice and, above all, prevention. We have routinely committed to holding a second PSVI conference in this country, only to see it kicked further down the road, so I hope that next year—in 2021, a year of conferences—we might again commit to holding an international conference where we can address the issue of gender-based violence.
I am proud that the Union Jack is recognised across the world as a symbol of aid and assistance and that they arrive without caveats. The UK has real power, soft and otherwise. In supporting people in the most difficult parts of the world, it can continue to commit to those people. We should never forget that, and I hope today’s debate, which sadly is all too short, will demonstrate the strength of feeling about this issue, about international development and about what we can do in the world to make it a better place for those who suffer so badly.
Fleur Anderson (Putney) (Lab)
It is a pleasure to serve under your chairship, Mr McCabe. I thank the hon. Member for Totnes (Anthony Mangnall) for all his work as chair of the APPG on the preventing sexual violence in conflict initiative, and I thank him and the hon. Member for Stafford (Theo Clarke) for co-sponsoring this very important debate with me. I am pleased that, despite our party differences, we are firmly united on this issue, particularly on the prevention of sexual violence in conflict, which is what I will focus on in my speech.
The year 2020 was set to be a watershed moment for women’s rights. It has been 25 years since the Beijing declaration and platform for action, and we were hoping to spend this year reaffirming commitments to gender equality that would accelerate progress towards dismantling the barriers that women and girls continue to face. However, in all corners of the world, violence against women remains rife and has increased in many contexts.
Whenever and wherever a crisis hits, violence against women and girls increases. Today is a dark day for two reasons. First, in Ethiopia and Tigray there have been three weeks of fighting: 40,000 Ethiopians have fled to Sudan and thousands are displaced in Tigray. I hope the Minister will tell us what action he is taking on prevention of sexual violence in that conflict. It is a very live issue.
The second issue is the cutting of the 0.7% aid commitment. The Conservative party manifesto gave that commitment and it was promised for many years, with support from people across the country. I was part of the huge demonstrations of support at previous G7 summits. This is the year before we host a G7 summit, and the prospect of having to walk into that room having cut our own aid budget is very depressing. It is harmful to the cause of taking action against gender-based violence.
Women and girls living in war zones and crisis areas are especially at risk of gender-based violence. In his report on conflict-related sexual violence, released back in June, the UN Secretary-General lists a series of truly harrowing verified case studies of sexual violence in current war zones. I will read some of them:
“In the Central African Republic, a mother of six was subjected to sexual violence by ex-Séléka elements who seized control of her village. During a reprisal attack by anti-balaka forces, she was abducted and repeatedly raped…In northern Mali, two sisters of adolescent age were abducted and gang raped by members of the Mouvement national de libération de l’Azawad. Upon their release, the girls received medical treatment, but no complaint was filed with the police, despite the identity of the perpetrators being known to the family, owing to the fear of reprisals.”
That is all too common a story. In Colombia, the National Victims’ Unit recorded 365 victims of conflict-related sexual violence during the armed conflict, saying:
“Women and girls made up 89 per cent of the victims”.
I have sat in a room of a similar size to this one with a group of women from Somalia, who told harrowing stories about their experiences during the continuing war in Somalia. I have seen them crying and they are with me in this important debate. The impact of using rape as a weapon of war lasts a lifetime, and it lasts through generations.
As the Secretary-General saliently points out in his report, we need to bear in mind that for every documented case of sexual violence,
“there are countless other stories that will never be heard.”
We do not know the enormous extent of this issue.
The recent establishment of the Foreign, Commonwealth and Development Office marks a crossroads for UK foreign policy. It will come as no surprise to Members that I fear that it is a mistake. It does, however, offer an opportunity to reset the up-to-now lacklustre support for the prevention of sexual violence in conflict initiative, which was announced with huge fanfare in 2012, and in 2014 we saw the magic of stardust and celebrity, with Angelina Jolie and a former Conservative Foreign Minister. It was proclaimed by the Conservative Government to be top of the leader board of international priorities, but I fear it is now languishing in the lower divisions. I hope the Minister can tell me how that will be changed.
This year’s Independent Commission for Aid Impact report on PSVI gave it the equivalent of an Ofsted rating of red or amber. I sincerely hope that the Minister will tell us how the Government are working differently to bring that back to green. Otherwise, what is the point of the two Departments merging and saying they are going to work better? The merger creates a high risk to the leadership of what was the Department for International Development in uplifting the rights of women and girls around the world.
The International Rescue Committee has written an important report on the need for survivor-centred approaches to tackling PSVI, highlighting the unintended consequences of mandatory reporting, which aimed to bring justice but too often resulted in stigma for survivors. We need to learn from that report. Its important recommendations include the need to listen to survivors, provide safe spaces and give them power and resources to organise themselves and make their own decisions. Those recommendations need to be added to the way in which we work on prevention of sexual violence in conflict.
I support the hon. Member for Totnes and the APPG in calling on the UK to push for a new, expert international body to collect and preserve evidence of conflict-related sexual violence. Evidence is essential to ending this. We need to bring more perpetrators to justice. The armed forces need to change how they act; otherwise, there will be no change at all. But this will be done only through the rigorous collecting of forensic, physical and digital evidence.
Secondly, the Government should ring-fence 1% of the UK’s official development assistance—up from 0.3%—to tackle gender-based violence, including sexual-based violence in conflict. Thirdly, responsibility for that should be restored to the Foreign Secretary. The ICAI report found that shifting responsibility to the level of a junior Minister
“resulted in ministerial attention and funding being redirected elsewhere”
and in our dropping down the league table.
Fourthly, the Government should use their new Magnitsky-style global human rights sanctions regime to target those who commit or encourage conflict-related sexual violence. That would send out strong signals that it is not acceptable. Fifthly, PSVI needs a longer-term approach, with a long-term strategy and funding cycle, not just a one-year funding cycle. This is an endemic problem of human rights and justice. It will take many years to solve it, and it needs many years of action.
I will add my own recommendations. The first is to end the stigma, which for many women is worse than the action itself. When they return, they are rejected by their husbands and communities, and many children are also rejected. We need global leadership to tackle the stigma so that it does not continue. I raised that in questions to the Church Commissioners this morning, and I will continue to raise it wherever and whenever I can. I hope the Minister will do so as well.
Secondly, when will the delayed global summit take place? Let us bring back Angelina Jolie and see who else we can get. We need to get back that global attention. In 2014, we were promised it would take place five years later, which, if my maths serves me correctly, was 2019. It did not happen then—although I can understand why—and it has not happened this year either. It really needs to happen next year. I like the fact that the hon. Member for Totnes has called 2021 the year of conferences—why not add one more? Thirdly, I want our work to focus on measures to document evidence and bring perpetrators to justice, and for us to think creatively about how to do that in this digital age.
In conclusion, as parliamentarians we must never lose sight of the profound and unspeakable suffering experienced by women and men as a result of sexual violence. It is not just women who are affected—men are definitely affected, too—but our focus today has been women. Our British values, of which I am very proud and which unite Members on both sides of the House, compel us to take up the issue, do what we can around the world, fight their corner and ensure that justice is done.
Imran Ahmad Khan (Wakefield) (Con)
I will not congratulate my hon. Friend the Member for Totnes (Anthony Mangnall) on securing this debate, but certainly I commiserate with him on the need to discuss this tragic subject. I hope that my right hon. Friend the Minister has found my hon. Friend’s case as powerful and persuasive as I have.
Sadly, I have on too many occasions sat, in distant, dangerous places ravaged by war or suffering a poverty of effective state structures, with women whose painful stories have left my cheeks wet. Over the course of the covid-19 pandemic, it has become glaringly apparent that cases of violence against women and girls have increased dramatically. Globally, 35% of women have experienced either physical or sexual violence from an intimate partner or non-partner in their lifetime. That statistic, however, does not take into account sexual harassment.
According to a report by ActionAid, 87,000 women around the world were intentionally killed in 2017. Of those, 50,000 were killed by a family member or a significant partner. That is an outrage. Globally, 650 million girls and young women alive today are married before their 18th birthday, with Niger, Central African Republic and Chad having some of the highest figures.
[Christina Rees in the Chair]
The covid-19 pandemic has only served to intensify some of these issues throughout the world. Domestic abuse cases have increased exponentially throughout the lockdown period. In April, the charity Refuge reported a 700% increase in calls to its helpline in a single day.
The recent merger of the Foreign and Commonwealth Office and the Department for International Development presents an opportunity for the United Kingdom to formulate a new strategy in tackling violence and discrimination against women across the globe. We do, of course, have a track record to be proud of in the United Kingdom. Aid and development spending has had a significant impact on reducing violence against women. Through aid programmes, more than 14 million children—6 million of them girls—have gained a decent education. Since 2015, nutrition-relevant programmes by the Department for International Development have reached 60.3 million women, children under five and adolescent girls. One UK aid project reduced rates of domestic violence from 69% to 29% across 15 remote villages in the Ituri region of the Democratic Republic of the Congo—a place I know—over a two-year period.
I object to the cut in the foreign aid budget from 0.7% to 0.5% of UK GDP. The potential repercussions for our ability to tackle violence against women and girls are such that it is likely to have significant and long-term negative consequences. However, I do accept that aid is only one tool at our disposal that can be used to tackle violence against women. Applying significant pressure to Governments with poor track records on women’s rights and domestic abuse is an alternative. If we are to redetermine and reposition our place in the world following our departure from the European Union, Her Majesty’s Government should ensure that we do not shy away from our obligations to those most in need, most vulnerable and most impoverished. I urge Her Majesty’s Government to utilise their membership of the high-level panel on women’s economic empowerment and our leadership role in the UN action coalition on gender-based violence, to demonstrate our, the United Kingdom’s, commitment to tackling this very serious issue.
Fiona Bruce (Congleton) (Con)
I congratulate my hon. Friend the Member for Totnes (Anthony Mangnall) on his thoughtful speech introducing this debate, and indeed the other speakers before me. I want to talk primarily about violence against women and girls that does not take place during conflict situations. I hope that will provide a contrast to the very thoughtful contribution from the hon. Member for Putney (Fleur Anderson).
In this debate, marking yesterday as International Day for the Elimination of Violence against Women, I want to highlight simply two issues: the forcible abduction and subsequent violation of girls from minority groups in Pakistan and Nigeria, which is happening at scale; and the suffering of women in the Uyghur camps in China, which is also happening at scale.
I thank Aid to the Church in Need, whose latest report, “Set Your Captives Free”, was released yesterday and also marked Red Wednesday, for drawing attention to the thousands of young Hindu, Shi’a, Sikh and Christian girls in Pakistan who are kidnapped and forcibly married to much older men every year. That happens generally with impunity, because of the vulnerable economic and social status of those girls. Women from those communities have become much more vulnerable since the outbreak of covid-19, and that increased vulnerability puts them at much greater risk. As a result, many young girls from minority communities, such as 14-year-old Maira Shahbaz and 13-year-old Arzoo Raja, have been kidnapped and forcibly married in Pakistan this year.
Many of the girls are subject to rape, forced prostitution and domestic abuse. In some cases, their families succeed in freeing the girls through the courts, but in other cases—remarkably and adding to the injustice of their abduction, forced marriage and alleged conversion—when they get to court, judges frequently order the return of the girl to their abductor. That attaches more credibility and importance to the statement of the girl’s alleged conversion to Islam than to the girl’s account of her abduction. It gives more credibility to the abductor than to the enforcement of the law that forbids marriage to a minor.
The real tragedy is that Pakistan’s very constitution and laws, particularly the blasphemy laws, are often the basis for such discrimination and violation, as in these court hearings. In any country, the constitution and legal system should be the cornerstone of the protection of fundamental human rights. Will the Minister confirm that whenever the opportunity arises, he and his colleagues will raise with his counterparts their concerns about the abduction of hundreds—indeed, thousands—of girls in Pakistan?
I make no apology for raising once again the plight of Leah Sharibu, whose mother Rebecca I met earlier this year. The sadness in Rebecca’s eyes lives with me today, and my heart goes out to her. Leah was just 14 when she was among the 110 school girls abducted by Boko Haram from their school. She is the only one still in captivity, because she has refused to renounce her Christian faith. She is now 17. I ask the Minister once again, as I have done before, to ensure that Leah’s plight, together with requests for her release, is raised with the Nigerian Government at every possible opportunity. I commend CSW for its continued campaign on Leah’s behalf.
I want to turn now to the Uyghurs. It is appalling to hear how women from the Uyghur community have been violated as part of the Chinese Government’s brutal campaign to curb its Muslim population. They are violated through forced birth control, pregnancy checks, the mandatory insertion of painful intrauterine devices, forced sterilisation and abortions. We hear that that is happening at scale, to hundreds of thousands of women. These population control measures are backed by mass detention as a punishment for failure to comply. The threat of being sent to prison—to the camps that we hear so much about—hangs over these women. Police raid homes, terrify parents and search for hidden children. Mothers of three or more children can be torn away, unless they can pay huge fines. Simply having too many children is a major reason why people are sent to detention camps. Many receive sentences of years, and in some cases decades, in prison just for having several children.
We even hear of female detainees being taken to prison camps and forced to abort their own unborn children. The result of this birth control campaign is a climate of terror. Birth rates in the mostly Uyghur regions of Hotan and Kashgar have plunged by more than 60% from 2015 to 2018—the latest year available in Government statistics. In the Xinjiang region, birth rates continue to plummet; they fell nearly 24% last year alone, compared with just 4.2% nationwide. Will the Minister, whenever possible, call on the Chinese Communist Party to end these horrific practices, which are part of a state-orchestrated assault on Uyghur women and the wider Uyghur community with the aim of purging them of their identity?
Naz Shah (Bradford West) (Lab)
It is a pleasure to serve under your chairmanship, Ms Rees. I congratulate the hon. Member for Totnes (Anthony Mangnall) on securing this very important debate. He talks very passionately about the issues for women, in particular, in regions of unrest and war.
On that note, I would like to talk about violence against women in occupied Kashmir by the Indian armed forces. We know that the rape of women becomes the weapon of choice in areas of conflict. I consider myself a daughter of Kashmir, because I spent my teenage years in Azad Kashmir in a village in Pakistan, where I had the luxury of being able to go to school without opening the front door and finding the military there with guns. I had the benefit and the freedom of going to school and going about my business without worrying about being cornered or subjected to rape, and without worrying about the women in the village being subjected to rape by the armed forces. That was a privilege that I enjoyed—that was in Pakistan-administered Kashmir.
In occupied Kashmir, however, there are some instances where women still have not received justice, and I will highlight some of them. The first UN human rights report in 2008 called for an inquiry, and I hope the Minister will support that call. Calls for inquiries have often been dismissed as propaganda by the opposite side—whichever side that is. That is not acceptable, and it should not be acceptable to us that those inquiries have not happened.
Human Rights Watch has identified two main scenarios where women are being raped by Indian forces: first, during searches and cordon ops and, secondly, during reprisal attacks by Indian forces after military ambushes.
Nowadays, 23 February is commemorated as Kashmiri Women’s Resistance Day because on that date in 1991, up to 150 women and girls were raped en masse—the biggest mass rape that has ever happened anywhere in this world. Indian soldiers were told to go on a mass raping spree in the villages of Kunan and Poshpora, and that is what happened. The women are still waiting for justice; not one perpetrator was held to account.
Recently, with the revocation of Article 370, Nivedita Menon, a professor at Jawaharlal Nehru University in New Delhi, said:
“These are proclamations of conquest and plunder, and reveal the real intention behind the abrogation of 370”.
On 10 August 2019, Manohar Lal Khattar, Chief Minister of Haryana, was quoted as saying:
“Some people are now saying that as Kashmir is open, brides will be brought from there. But jokes apart, if [the gender] ratio is improved, then there will be a right balance in society”.
Earlier, the Bharatiya Janata party’s Vikram Saini, a member of a legislative assembly, said:
“Muslim party workers should rejoice in the new provisions. They can now marry the white-skinned women of Kashmir”.
I went to Pakistan, to Azad Kashmir, and met lots of Kashmiri women. Many Kashmiri women have come here to make representations to this House, to members of the all-party parliamentary Kashmir group and to others, and they have told us of the horrors that they have faced.
I wanted to talk about this today because I have lived in Kashmir; I have seen what it is like to have freedom, even in somewhere like Pakistan and even after having been subjected to a forced marriage myself. I absolutely understand what the hon. Member for Totnes was talking about, but I still had the freedom of not having someone putting a gun barrel against my back, taking me into a corner and raping me. I still had those privileges in Pakistan-administered Kashmir, and I am looking forward to taking my daughter there to introduce her to those areas.
What of those women in Kashmir, who cannot leave? We struggle, as people here, with the curfews—
Imran Ahmad Khan
The story that the hon. Member tells about her own forced marriage is tragic. However, as my hon. Friend the Member for Congleton (Fiona Bruce) has mentioned in relation to the case of 14-year-old Maira Shahbaz, it is slightly hollow for Pakistan—whether in Azad Kashmir or the main part—to protest about freedoms and human rights when its own laws allow for the abuse of its citizens.
In Maira’s case, it is not just that a 14-year-old girl was gang raped and then kidnapped out of her home; she was then forcibly converted to Islam, so if she now renounces that religion, she will be sentenced to death for apostasy under Pakistani law. That really makes the points that the hon. Member made, which are all right, hollow in the case of Pakistan.
Naz Shah
I thank the hon. Member for his intervention. I recognise what he is saying, and he makes a powerful point. However, I do not recognise the idea that this is hollow. That is whataboutery, and we are not here for whataboutery. We are here because every life matters, as we have heard from every single Member who has spoken in this debate. For every 14-year-old that was raped in Pakistan, I can talk about the eight-year-old child that was raped in occupied Kashmir. This is not a competition about which girl deserves more of our concern, or in which area in the world that girl should be protected. That is not what this is about.
Let us get this right: our laws in this country do not give us equal pay, and we are the biggest democracy in the world. I will not take lessons on hollowness from the hon. Member when his Government have not implemented equal pay for women, and when they are even worse when it comes to black and minority ethnic women. Let us not belittle this debate and bring it down to whataboutery. This debate is about women.
The hon. Member for Totnes was spot on. As he highlighted, this debate is about looking at the 16 days of activism to stop violence across the world. Whether that is in Pakistan, India or Uganda, and whether it involves Boko Haram or any other terrorist organisation, women are being used as a weapon of war. They are being raped, and they are being violated. That is what the House needs to understand. We must work together, regardless of whether that is happening in Pakistan or India. I wanted to focus on the issue of women in occupied Kashmir being gang-raped by Indian forces, and I will not have that diminished. That is what must be highlighted, and that is the note on which I will end my contribution to this debate.
Owen Thompson (Midlothian) (SNP)
It is a pleasure, in some senses, to take part in this debate. I thank the hon. Members for Totnes (Anthony Mangnall) and for Putney (Fleur Anderson) for opening this debate, and the hon. Member for Stafford (Theo Clarke) for securing it. It is important that this issue is raised now, although it is a great pity that it is not taking centre stage in the main Chamber, as some of us in this Chamber perhaps feel it should.
Gender-based violence has been described by the United Nations as “a global pandemic”, with at least 15 million more cases predicted around the world as a result of covid-19 restrictions. Surely, a problem of that scale should not be sidelined. I draw Members’ attention to my entry in the Register of Members’ Financial Interests as a volunteer trustee on the board of the White Ribbon Scotland campaign. I am also the father of a young girl, and I do not want her to grow up in a world that tolerates sexism, abusive behaviour or violence against women or girls.
Today, we are discussing international development, and I will come to that in a moment. In some cases, although we must look globally, we also need to reflect locally. To demonstrate leadership internationally, the Government need to get their own house in order. Eight years ago, the Government signed the Istanbul convention: the gold standard, comprehensive approach to addressing violence against women and girls. It was an opportunity to bring unprecedented positive change, including improvements for refugees and asylum seekers in the UK who have been victims of gender-based violence.
In 2016, I was part of the IC Change campaign to hurry the Government along from their good intentions to solid action. I backed a Bill that was brought forward by my former party colleague, Eilidh Whiteford, to ensure the treaty was fully integrated into UK law. That received widespread cross-party support, yet here we are, four years on, and the Istanbul convention has still not been ratified. That suggests that the UK Government are not taking it seriously enough. Could the Minister reassure me that these crucial protections for women and girls will be put higher up the agenda, and that the Government will finally offer a timetable for ratifying the treaty?
Every year, we hear the appalling statistics about gender-based violence, which affects one in three women in their lifetime. Some of the national studies show figures as high as 70%. The United Nations reports that 137 women are killed by a family member every day. Although progress has been generally slow, this year it is moving at an exponential pace, but in the wrong direction. Pandemic restrictions have meant that women are being forced to lock down with abusers, at the same time as services to support survivors are disrupted. Calls to domestic abuse lines have increased fivefold in many countries. There is a silent pandemic of abuse, and it is not getting the attention it requires.
The merging of the Department for International Development and the Foreign Office sent the wrong signal about how much the Government prioritise humanitarian programmes that tackle gender-based violence in the poorest nations, but I would be delighted to be proven wrong on that. Certainly, at a time of global crisis, the budget should be ring-fenced, not cut. It was therefore particularly disappointing that yesterday the Chancellor announced a cut in the foreign aid budget. Although I understand that girls’ education will be protected in the remaining funds, that is only one element in the battle against violence against women and girls. I have grave concerns about the impact on women’s empowerment programmes, aid worker system changes, the women, peace and security agenda, and anti-female genital mutilation programmes, to mention just a few things.
Before the pandemic, violence against women and girls programmes were already persistently underfunded, as we have heard from other Members. They were given far too low a priority in aid budgets. The International Rescue Committee estimates that 14 million displaced or refugee women were subject to sexual violence in 2019, while less than 0.2% of all global humanitarian funding was allocated to addressing gender-based violence. That is shamefully inadequate, and I urge the FCDO to show leadership and dedicate a fixed or minimum percentage of its budget to fighting that crucial issue for global health, wellbeing, justice and economic development.
The UK has an opportunity to set a global long-term standard that other international donors could follow. As highlighted in this month’s African Child Policy Forum report, we are witnessing a global roll-back of women’s rights. The UK’s leadership on programmes to do with women, peace and security and sexual violence in conflict is more important than ever. That leadership extends to creating better strategies to ensure that those who are sent from the UK to provide support in crises do not include the perpetrators of abuse against some of the world’s most vulnerable people.
Like most, I was absolutely appalled to read reports of aid providers’ sexual abuse and exploitation of sufferers of the Ebola outbreak in the Democratic Republic of the Congo. That came after the previous scandals involving senior male staff from a range of organisations, including Oxfam and Save the Children. The momentum for change has clearly not been maintained, and the International Development Committee has had to launch its third piece of work on sexual exploitation and abuse in only two years. I urge the Government to step up efforts for meaningful reform.
Safeguarding measures are crucial, but with such imbalanced power dynamics, we also need better mechanisms within communities to ensure that the victims can come forward. The Government could use the full capability of their overseas network to help embed that cultural change, provide support services to survivors and victims, and help to bring the perpetrators to justice.
The roll-back of progress is not just a global issue; it is happening here, too, under the cover of covid-19. In my constituency, Women’s Aid reports a 60% rise in referrals, including a rise in demand for its services for high-risk victims, where there is a risk to life. Its refuges have been full throughout the crisis and it is urgently seeking more housing. The Scottish Government, in partnership with Scottish local government, are playing their part to assist. They have removed bureaucracy and set up dedicated funding for services to protect women and girls from gender-based violence. Their world-leading Equally Safe strategy is part of their vision to eradicate and prevent violence against women and girls, and they published their three-year update just yesterday. They are also progressing key policy changes, such as the Domestic Abuse (Scotland) Bill. A taskforce on human rights leadership has been set up, and it will consider incorporating into Scots law the UN convention on the elimination of all forms of discrimination against women.
We are fighting against a rising tide of abuse, and a lot more needs to be done nationally and internationally to raise awareness, provide resources and ensure that we protect all women and girls against gender-based violence. We know that it is rooted in a culture of gender inequality, which needs to be tackled at its roots. At the moment, not a single country is on track to meet the sustainable development goal of achieving gender equality by 2030. Just 0.1% of the total aid from the Organisation for Economic Co-operation and Development is committed to women’s organisations.
As a permanent member of the UN Security Council and the UN penholder on women and peace and security, the UK is in a rare position to be able to do more. The international community should treat gender-based violence with the same urgency and gravity as natural disasters and humanitarian catastrophes. The UK has a unique opportunity to lead the way on that. I support the calls of the hon. Members for Totnes and for Putney for a summit to be held at the earliest opportunity so that these issues can be looked at in far more detail. I urge the Minister and the Government to grasp with both hands the opportunity that is in front of them to make a genuinely transformational change that improves the lives of so many women and girls around the globe.
Anna McMorrin (Cardiff North) (Lab)
It is a pleasure to serve under your chairship, Ms Rees. I thank my hon. Friend the Member for Putney (Fleur Anderson) and the hon. Member for Totnes (Anthony Mangnall) for securing this important debate on the UK’s development contribution to tackling gender-based violence across the world. As colleagues have pointed out, yesterday marked the International Day for the Elimination of Violence Against Women and the beginning of 16 days of activism, amplifying the call for global action on eliminating gender-based violence by 2030, which is a campaign that we firmly support.
There have been many passionate and important contributions to the debate, but I want first to praise my Front-Bench colleague, my hon. Friend the Member for Bolton South East (Yasmin Qureshi), who has been working hard on this issue throughout the coronavirus crisis but could not be present today. My hon. Friend the Member for Putney made a powerful contribution by sharing her experiences of visiting victims of violence in Somalia, and it is important that those women’s voices are heard in these types of debates. My hon. Friend the Member for Bradford West (Naz Shah) made a really passionate speech on the impact of gender-based violence on women and girls in occupied Kashmir—that violence is used as an act of war.
Gender-based violence is a moral emergency with devastating impacts. One in three women and girls are affected, and will continue to be affected, throughout their lifetime. Violence and abuse shape and define lives, livelihoods and relationships. It strips a person of their freedoms, and not only in that moment, but in the decisions that they go on to make throughout the rest of their life.
Only this morning I was in a meeting with women from the Syrian British Council. They told me of their horrific experiences and explained how rape and sexual violence is used as a form of torture in Syria. From domestic abuse to sexual assault, female genital mutilation, early motherhood and forced marriages, violence against women and girls includes psychological, emotional and physical abuse. Women experience violence at home, in the street, at school and in the workplace, and during times of both peace and conflict or crisis. It happens online and offline.
The subordination of women by men is a means of control and power, and it is often executed through acts of violence. It is an attack on human rights and dignity, and a threat to our rights in one household, wherever in the world it may be, is a threat to our rights everywhere. Violence against women and girls is also a silent killer. Domestic violence is one of the most common causes of gender-related deaths of women around the world, which should both alarm us and press us into sustaining and furthering action and our commitment to rooting it out.
The UN reports that 243 million women and girls were abused by an intimate partner in the past year alone, although less than 40% of those who have experienced violence actually report it. That should shame us all. It is a major obstacle to building the fair, just, equitable and sustainable future that we all want to achieve and pass on to the next generation—our daughters and granddaughters. Despite the UK being renowned in recent years for our leadership on tackling gender-based violence in the developing world and promoting girls’ education and women’s equality, we are far from reaching the finishing line.
When scrutinising the use of UK aid, the Independent Commission for Aid Impact reported that DFID had made a significant contribution to the elimination of violence against women and girls prior to its merger with the Foreign Office. We should rightly be proud of that, but we learned yesterday that the Government have cut the aid budget. It is a short-sighted and reckless cut that not only undermines the UK’s efforts, but risks leaving exposed women and girls in the developing world who depend on our assistance.
Diluting funding will cut away vital safe spaces, education and support for survivors of sexual violence, as well as our ability to tackle its many drivers, such as extreme poverty, food scarcity and the climate emergency, which aggravate the violence to which many women and girls are subjected. We know that the climate emergency disproportionately impacts women and their health. In fact, 68% of women face much higher health risks from the impact of climate change than men.
Not only does the cut break the Minister’s own manifesto pledge, to which he publicly committed in a recent written answer, but the 0.7 % commitment is enshrined in law. Baroness Sugg, the former Minister for the Overseas Territories and Sustainable Development, and the first special envoy for girls’ education, who was responsible for driving most this work, as the Minister will no doubt recall, resigned yesterday following the cut to the aid budget, which she said will
“diminish our power to influence other nations to do what is right”.
I agree.
We must not forget that the cut represents a third of the budget. No other Department has seen such stringent reductions in spending power. Does that mean that we will write off a third of the girls in the developing world who rely on our educational programming? The International Rescue Committee reported 14 million refugee women and girl survivors of rape and sexual violence in 2019. Will the Minister tell us whether a third of them no longer need our help? At this time of maximum vulnerability, when the scale of need has never been so great, we must not turn our backs on the world’s poorest and most vulnerable, and retreat from the global stage.
Even before covid, gender-based violence had reached pandemic proportions. The introduction of national lockdowns at home and across the developing world, combined with additional economic and emotional stresses, saw violence and abuse rise fourfold. The United Nations Office for the Coordination of Humanitarian Affairs reports that for every month of lockdown, there are 15 million extra cases of domestic violence across the world. School closures and economic constraints leave women and girls poorer, out of school and jobs, and more vulnerable to exploitation, abuse, forced marriage and harassment. Worse still, that abuse is locked firmly behind closed doors. UN reports show that domestic violence has increased as survivors have found it more difficult to access support. This is a shadow pandemic. The covid crisis must not be used as a reason to abandon our promise to be a strong and dependable partner through the tough times as well as through the good.
In many cases, our aid is the first and last hope of improving women and girls’ lives. It matters to people such as Alia and her daughter Amira that we keep our promise. They both fled Alia’s abusive husband, who wanted to perform genital mutilation on Amira, his 11-year-old daughter. He terrorised and threatened them with their lives, but they showed bravery and courage to escape Sudan, enduring hardships and insecurity on the road, and found sanctuary—or so they thought—in Libya. There, however, they became even more vulnerable to violence. Alia describes the harrowing tale of a Libyan man trying to kidnap her daughter from a camp that they had temporarily called home, so that he could force her into marriage. The harassment and exploitation did not stop following them, all because they were female and dared to stand up for their rights to flee an abuser who they had thought they could trust, love and depend on.
It is thanks to a UK-funded project that they have both received what they needed: refuge, support and counselling. That programme will last until 2023, apparently. I asked the Government in September whether they would protect the funding from cuts. The Minister promised that it would be maintained. Can he keep that promise, following yesterday’s announcement?
Have the Government undertaken an assessment of exactly what the cut to the 0.7% commitment will mean? If not, why not? Why are we still waiting for the Government’s analysis of the £3 billion cuts from August? Can the Government provide clarity and be honest about what they are going to cut, allowing civil society and the wider sector to plan what interventions they can make, rather than making a chaotic withdrawal of funding? Will the Minister also confirm that when he brings back the legislation it will include a sunset clause, to determine when the 0.7% commitment will return?
I endorse the requests from the hon. Member for Totnes and my hon. Friend the Member for Putney about the global summit on the prevention of sexual violence in conflict, which was meant to happen last year, and will not happen next year. Will the Government commit to bringing it forward and hosting it? Those are critical issues, but also this is a moment for self-reflection at home. Gender-based violence happens across the world and it can impact those closest to us. Let us show leadership and demonstrate that we can prioritise that essential issue.
The Minister for the Middle East and North Africa (James Cleverly)
It is a pleasure to serve under your chairship, Ms Rees. I am grateful to my hon. Friend the Member for Totnes (Anthony Mangnall) for securing the debate, and to my hon. Friend the Member for Stafford (Theo Clarke), who is not here, and the hon. Member for Putney (Fleur Anderson), for bringing this important issue to Westminster Hall. I thank the other Members who have spoken for their contributions. I pay tribute to the work that Members present in the Chamber have contributed in various ways on this most important of issues, whether through the all-party parliamentary group on the preventing sexual violence in conflict initiative, as a member of the International Development Committee, or as a member of the all-party parliamentary group on domestic abuse.
As Minister for the Middle East and North Africa, I also lead on the women, peace and security portfolio. One thing that has come up during the debate is how the various strands of Government work—on supporting education for women and girls, on preventing sexual violence in conflict, and on ensuring that women peace builders have a meaningful voice in conflict resolution—are not separate; they are all interwoven. It is important that in Government we address the full spectrum of policies. Work to end all forms of gender-based violence, to tackle gender equality, and to ensure that women are empowered and are part of the decision-making process internationally is, and will remain, a priority for the Foreign, Commonwealth and Development Office.
I will try to address as many of the points that were raised in the debate as I can. I know that there will be frustrations about this, but hon. Members will understand that I will not be in a position to give as much clarity or assurance as they might wish, but I assure them that all the points raised and ideas put forward, and all the requests made of the Government, will be recorded and considered.
As my hon. Friend the Member for Totnes made clear, gender-based violence is not just about violence directed at women and girls, but the sad truth is that they do bear the brunt of it. If he will forgive me, I will focus most of my comments today on the impact on women and girls, because violence affects women and girls everywhere. As has been mentioned, one in three women worldwide will experience physical and/or sexual violence in their lifetime, making violence against women and girls one of the most systemic and widespread human rights violations of our time.
This year, the 16 days of activism to end violence against women are more important than ever. As a number of hon. Members have said in the debate, covid-19 has intensified the shadow pandemic of gender-based violence, and lockdown measures around the world have reminded us that homes, rather than being a place of safety and refuge, for many women and girls are in fact a place of danger and abuse—sadly, including here in the UK.
In east and west Africa, increased rates of female genital mutilation have been reported. In some countries, there have been reports of sexual exploitation by those Government officials tasked with enforcing lockdown requirements. A bigger global response is more urgent now than ever, but we should remember that gender-based violence was endemic before covid-19 and that it will not go away when, hopefully, we are able to get control of this disease. Therefore we need additional action to address it; it will continue beyond covid-19 unless we take that action.
However, there is hope. The UK-funded What Works to Prevent Violence programme has proved that violence against women and girls is preventable, and more than half our rigorously evaluated pilots showed significant reductions in violence of around 50% in less than three years. For example, in the DRC—a place that was mentioned during the debate—the project with faith leaders and community action groups halved women’s experience of intimate partner violence. We need to use and adapt that evidence to build back better after covid and learn from those successes. The Member for Putney raised the distressing situation in Tigray and asked what engagement my right hon. Friend the Foreign Secretary has had. I am pleased to say that he met Ethiopian Foreign Minister Mekonnen yesterday and specifically raised the protection of civilians from violence during their bilateral discussion.
We need to do more, to reach more people and to distribute the learnings of what works to prevent sexual violence. That is why we continue to invest in the successor programme, What Works to Prevent Violence: Impact at Scale. That is a programme to scale up our programming and research to prevent sexual violence against women and girls globally. We are delighted to have been selected to co-lead the new Generation Equality action coalition on gender-based violence. The Generation Equality action coalition is a global multi-stakeholder partnership intended to spur collective action to deliver concrete, game-changing results on gender-based violence over the next five years.
We are using this opportunity to increase international action to tackle gender-based violence in the context of covid-19. We are calling on donors to channel funding to women’s rights organisations and movements that are on the frontline of delivering change. The UK recently announced an additional £1 million of funding to the United Nations trust fund to end violence against women, increasing our total contribution to £22 million. The additional funds will support women’s rights organisations tackling the surge of gender-based violence due to covid-19.
James Cleverly
That money has already been allocated. As I said, I cannot give clarity as to what future funding streams will be like, but this agenda remains a priority for the Government.
We will continue to take a leading role to tackle gender-based violence in conflict and crisis, including through the preventing sexual violence in conflict initiative. Last week, my noble friend Lord Ahmad launched the declaration of humanity. Crucially, that declaration commits leaders of faith and belief groups to do all in their power to prevent sexual violence in conflict, to support victims and to dismantle harmful cultural norms and misinterpretations of faith. I hope that will go some way to addressing the concerns raised by my hon. Friends the Members for Congleton (Fiona Bruce) and for Wakefield (Imran Ahmad Khan), because sadly, that is too often used to justify and condone acts of sexual violence.
Through the call to action on protection from gender-based violence in emergencies, the UK works with our partners to drive system change to better protect women and girls in a humanitarian context. We are pushing for increased funding and greater accountability on gender-based violence as part of humanitarian responses. My hon. Friend the Member for Wakefield made an important point, however, that although ODA is important, it is not the only means to drive change in this agenda.
Several hon. Members have criticised the merger of the FCO and DFID to form the new FCDO, and I recognise the points about yesterday’s announcement and the statement from my right hon. Friend the Foreign Secretary today. Using the UK’s economic power, however, we will still be one of the most generous ODA-donating countries in the world, and we can also use our diplomatic power as a force multiplier.
We will put women and girls at the top of the UK’s agenda for our term as president of the G7. We will use our position as co-leaders on the GBV action coalition to tackle the root causes of violence. As COP26 president, we will promote clean and inclusive resilience from covid and natural disasters, because, of course, we know well that those economic and environmental pressures are drivers of conflict, and that conflict is often a driver for sexual violence against women and girls. We will continue to push the agenda through our diplomatic network.
I reiterate that violence against women and girls is not only completely and wholly unacceptable, but preventable. The key message for today is that we should not, and must not, accept it as a reality. I return to the praise that I gave to hon. Members on both sides of the House who have done so much work to drive this issue and to ensure that the appropriate attention is paid to it globally.
We must challenge the idea that there is inevitability or inertia, or indeed that change takes decades or generations. It does not. It should not. That is why we have prioritised this important work. We are working to stop any reversal of our hard-won progress on gender equality, perhaps driven by the covid-19 pandemic, and we are using the spotlight the pandemic has shone on the violence women and girls have to endure to tackle the root causes and accelerate progress to meet the sustainable development goals on this issue.
Anthony Mangnall
What a privilege to have 15 minutes to wind up, Ms Rees. You are very generous to give me such time.
Anthony Mangnall
I will be brief. I thank everyone for turning up to speak in this debate. The hon. Member for Putney (Fleur Anderson) spoke passionately about her experience working with Somali women and with WaterAid in the UK. It is incredible working with her on the all-party parliamentary group on the preventing sexual violence in conflict initiative, and I thank her for her support for my support for an international panel and body. I look forward to working with her on many other such issues.
My hon. Friend the Member for Wakefield (Imran Ahmad Khan) was kind enough to inform us about his experiences around the world and the moving impact he has had working with different communities. The House is better for having his experience, and the all-party parliamentary group on foreign affairs is lucky to have him as its chair.
My hon. Friend the Member for Congleton (Fiona Bruce) spoke passionately, if I may say so. She shifted the focus, rightly, out of conflict zones to an area that also needs redress and resolve. To speak of the justice system as she did was a stark reminder of the lack of justice seen by so many people across the world. The hon. Member for Bradford West (Naz Shah) also spoke about the need for justice, not only in specific geographical areas, but across the world. She raised the important matter of women in Kashmir. I greatly valued her contribution.
The hon. Member for Midlothian (Owen Thompson) has always been suspiciously kind to me on a whole host of issues. I am particularly grateful for his support since the day that I gave my maiden speech on this issue. He was right to talk about issues such as the Istanbul convention and to say that leadership is more important than ever. He has a global and local vision. This is not an issue on which the UK can sit on a high horse. Domestic abuse happens within our shores. We have seen how prevalent it has been during the lockdown.
The hon. Member for Cardiff North (Anna McMorrin) has also been kind and direct about what needs to be done. More often than not, UK Aid is seen as the first and last hope. That is incredibly powerful. We are all conscious of the fact that UK Aid, stamped on to humanitarian packages and the backpacks of the people we send across the world to help, is greeted with relief and the understanding that the international community is engaged. Anything that damages that is particularly worrying.
I thank the Minister for his comments. Change does not take decades, but by my count it is taking eight years. We launched the PSVI eight years ago and I think the UK can go further. I want to say a few words about what I have done on this. When I was elected, I wrote to the ambassador of every country that signed the UK’s resolution in the UN on the PSVI. I have had 90 responses to 146 letters. Nearly every one says that they are still waiting for the UK to show leadership on this issue. That is, 90 countries have bothered to respond on this issue, good and bad, and they are asking the UK to continue its leadership. If we do not, we must be prepared to help others lead. That will either be Germany or the United States. I hope that we can find the resolve and determination to do it here and now, with the opportunity presented by the G7 presidency next year. Germany and the US are working very hard on this. If they lead on this, I will be happy to support them with others.
I passionately believe that the UK has a role to play on the international stage not only in defence, but, more importantly, in international development. This issue is a core tenet of international development. I hope that when he goes back to the Foreign Office, the Minister will tell the Foreign Secretary and others that there is a strong group of Members of Parliament who wish to see action on this issue, and that we will continue to raise it at any opportunity we are given.
Question put and agreed to.
Resolved,
That this House has considered international development and gender-based violence.
Written Statements
(4 years, 1 month ago)
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Departmental Contingent Liability Notification: Human Challenge Project
(4 years, 1 month ago)
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The Secretary of State for Business, Energy and Industrial Strategy (Alok Sharma)
I am tabling this statement for the benefit of right hon. and hon. Members to bring to their attention the contingent liabilities relating to the contract signed between the Government and Imperial College London for the human challenge project.
This project was announced on 20 October and is aimed at supporting the search for a covid-19 vaccine. A £33.6 million Government investment will back the project in partnership with Imperial College London, hVIVO and the Royal Free London NHS Foundation Trust.
In human challenge studies, a vaccine candidate that has proven to be safe in initial trials is given to a small number of carefully selected healthy, young adult volunteers who are then exposed to the virus in a safe and controlled environment. These studies offer the chance to accelerate development of promising vaccines against covid-19, bringing them to people more quickly and potentially saving thousands of lives.
The first step of the project is the virus characterisation study. This will begin in January 2021 and establish the smallest amount of virus needed to cause covid-19 infection in the volunteers. Robust safety, ethics, and regulatory approvals will be put in place before the study begins. Imperial College is the academic study sponsor for the characterisation study. As study sponsor, Imperial will be liable for any negative side-effects volunteers may experience in this study. Imperial has therefore taken out its own insurance, up to the sum of £10 million and for up to 36 months after completion of the study.
My Department has agreed to provide the excess for a relief claim that Imperial may make for a maximum of £15,000 per volunteer (to a maximum of the 90 volunteers involved in this study). This is only applicable where the claim arises as the result of the study but not as the result of one of the parties’ negligence. In addition to the agreed excess, my Department has agreed to provide unlimited indemnity beyond the £10 million.
My Department believes that this is a justifiable position given the very low risk of exceeding the maximum liability. In a reasonable worst-case scenario, our analysis estimates that liability would be under £1.5 million. Therefore, we do not expect the maximum liability to be exceeded.
A full departmental minute will be laid in the House of Commons providing more detail on this contingent liability.
[HCWS605]
Covid-19 Winter Plan: Tiers
(4 years, 1 month ago)
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The Secretary of State for Health and Social Care (Matt Hancock)
On 23 November, the Prime Minister set out our covid-19 winter plan in Parliament. Our covid-19 winter plan puts forward the UK Government programme for suppressing the virus, protecting the NHS and the vulnerable, keeping education and the economy going, and providing a route back to normality.
Thanks to the shared sacrifice of everyone in recent weeks, in following the national restrictions, we have been able to start to bring the virus back under control and slow its growth, easing some of the pressure on the NHS.
We will do this by returning to a regional tiered approach, saving the toughest measures for the parts of the country where prevalence remains too high.
The tiering approach provides a framework that, if used firmly, should prevent the need to introduce stricter national measures.
On 2 December, we will lift the national restrictions across all of England and the following restrictions will be eased:
The stay-at-home requirement will end.
Non-essential retail, gyms, personal care will reopen. The wider leisure and entertainment sectors will also reopen, although to varying degrees.
Communal worship, weddings and outdoor sports can resume.
People will no longer be limited to seeing one other person in outdoor public spaces, where the rule of six will now apply.
The new regulations set out the restrictions applicable in each tier. We have taken into account advice from SAGE on the impact of the previous tiers to strengthen the measures in the tiers, and help enable areas to move more swiftly into lower tiers.
The changes to the tiers are as follows:
In tier 1, the Government will reinforce the importance that, where people can work from home, they should do so.
In tier 2, hospitality settings that serve alcohol must close, unless operating as restaurants. Hospitality venues can only serve alcohol with substantial meals.
In tier 3, hospitality will close except for delivery, drive-through and takeaway, hotels and other accommodation providers must close (except for specific exemptions, such as people staying for work purposes, where people are attending a funeral, or where they cannot return home) and indoor entertainment venues such as cinemas, theatres and bowling allies must also close. Elite sport will be played without spectators. Organised outdoor sport can resume, but the Government will advise against higher risk contact sports.
These are not easy decisions, but they have been made according to the best clinical advice, and the criteria that we set out in the covid-19 winter plan.
These are:
Case detection rates in all age groups
Case detection rates in the over-60s
The rate at which cases are rising or falling
Positivity rate (the number of positive cases detected as a percentage of tests taken)
Pressure on the NHS.
The indicators have been designed to give the Government a picture of what is happening with the virus in any area so that suitable action can be taken. These key indicators need to be viewed in the context of how they interact with each other as well as the wider context but provide an important framework for decision making, assessing the underlying prevalence in addition to how the spread of the disease is changing in areas. Given these sensitivities, it is not possible to set rigid thresholds for these indicators.
The regulations will require the Government to review the allocations every 14 days, with the first review complete by the end of 16 December.
We have been able to announce UK-wide arrangements for Christmas, allowing friends and loved ones to reunite, and form a Christmas bubble of three households for five days over the Christmas period.
We have increased funding through our contain outbreak management fund, which will provide monthly payments to local authorities facing higher restrictions.
We are also launching a major community testing programme, homing in on the areas with the greatest rate of infection.
This programme is open to local authorities in tier 3 areas and offers help to get out of the toughest restrictions as fast as possible.
The listed areas will be in each tier from the 2 December. This list will also be published on gov.uk and a postcode tracker will be available for the public to check what rules apply in their local area.
A list of allocations can be found at: https://questions-statements.parliament.uk/written-statements/detail/2020-11-26/HCWS608
[HCWS608]
Public Health England: Annual Report and Accounts 2019-20
(4 years, 1 month ago)
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The Secretary of State for Health and Social Care (Matt Hancock)
I wish to inform the House of the publication of Public Health England’s annual report and accounts for the financial year 2019-20. A copy of the annual report and accounts 2019-20 (“the Report”) has been laid before both Houses.
Public Health England (PHE) is an Executive agency of the Department of Health and Social Care, providing the evidence, support and advice needed locally, nationally and internationally. PHE is responsible for four critical functions: protecting the public’s health; improving the public’s health, improving population health; and supporting the capacity and capability of the public health system in England.
The report sets out the activity, performance and expenditure of PHE for key areas of its business for 2019-2020 financial year and reflects the position as at 31 March 2020. The report is based on activity in the 2019-20 financial year and notes that some performance in the final quarter was impacted because PHE rigorously reprioritised to free up significant internal resource for the covid-19 response.
As referenced in the report, on 18 August 2020, the Government announced the establishment of a new National Institute for Health Protection (NIHP), which will bring together the additional testing capacity at scale of NHS test and trace, the joint biosecurity centre intelligence and analytical capability with the public health science and health protection expertise of PHE. NIHP will be formally and fully established in 2021.
NHS test and trace and PHE put in place integrated arrangements on the covid-19 response and created a joint situational awareness team to provide analysis and insight into the progression of the virus, under single leadership.
Until further formal changes are made, PHE continues to operate and deliver its core functions in line with its framework agreement and continues to be held to account for delivery against the priorities set by Government in the annual strategic remit and priorities letter and agreed business plans through formal quarterly accountability meetings. PHE’s governance boards and groups and PHE’s advisory board also continue to operate. There will be a continued focus on responding to covid-19, now and throughout the winter. Health improvement, preventing ill health and reducing inequalities will also remain priorities for PHE, prior to full transition to new arrangements.
Work is underway to determine the right future arrangements for PHE’s vital non-health protection functions, including health improvement responsibilities, and we will engage widely on proposals before implementing new arrangements in 2021.
[HCWS606]
Elizabeth Dixon Investigation Report
(4 years, 1 month ago)
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The Minister for Patient Safety, Mental Health and Suicide Prevention (Ms Nadine Dorries)
Today we have published the report into the events surrounding the death of Elizabeth Dixon—a baby who sadly died in December 2001 from asphyxiation resulting from a blocked tracheostomy tube and while under the care of a private nursing agency.
I offer my heart-felt condolences to Elizabeth’s family, to Anne and Graeme Dixon for their loss, compounded by the length of time—the passage of 20 years—before the facts of this case have been brought to light.
The investigation led by Dr Bill Kirkup was tasked with reviewing the care given to Elizabeth Dixon between her birth on 14 December 2000 and her death on 4 December 2001—and the response of the health system to a catalogue of errors and serious failings in that care.
This report describes a harrowing and shocking series of mistakes associated with the care received by Elizabeth and a response to her death that was completely inadequate and at times inhumane. Elizabeth and her family were let down by a failure to diagnose or respond to her underlying condition, to put in place the care she required, to acknowledge the circumstances of her death or provide her parents with an honest account of these failings.
The investigation sheds light on what the report describes as a “20 year cover up”. It alleges that some individuals have been persistently dishonest in accounting for their actions or inaction.
Underlying all of this was the acceptance of a flawed prognosis that influenced the future course of events. It created a situation in which
“facts were wilfully ignored, and alternatives fabricated”.
Shocking too is the implication in the report’s recommendations that the presence of her physical and mental health needs may have been used to justify or excuse the inadequate care she had received.
On behalf of Government and the health system I would like to say I am truly sorry for the devastating impact this must have had upon the Dixon family.
Individuals made mistakes and acted unprofessionally, but the system allowed it. The report makes it clear that
“clinical error, openly disclosed, investigated and learned from, should not result in blame or censure; equally, conscious choices to cover up or to be dishonest should not be tolerated”.
It is also unacceptable for patients ever to be exposed to unsafe or poor care, and I remain fully committed to ensuring we provide the highest standards of quality and safe services to all patients.
I am grateful to my right hon. Friend the Member for South West Surrey (Jeremy Hunt) for commissioning this investigation in June 2017 when he was Secretary of State for Health and bringing these events into the open. I would also like to thank Dr Bill Kirkup and his team for the diligence and hard work that has informed their report.
Particularly, I would like to pay tribute to Anne and Graeme Dixon who have fought so hard for answers. I hope this report is the beginning of a process that will bring some closure for the family. They should not have had to wait for so long.
This report shines a light on a culture of denial and cover up 20 years ago that left a family with little choice but report their concerns to the police. Families should not have to fight a closed system for answers and I will not hesitate to expose this sort of behaviour whenever it appears today. Indeed, Elizabeth’s legacy should be that other families will always be told the truth.
Relevant organisations will need to consider and reflect carefully on the report’s recommendations. There is no room for complacency. The continual appearance of shocking reports about patient safety—historical or more recent—implies there is much for the NHS to focus on. My Department will therefore have oversight of their responses and report back to the House. There needs to be learning and implementation, but above all I want to be assured that we are doing all we can to make sure such events cannot happen again.
No other family should ever again have to go through the heartache and frustration experienced by the Dixons and I apologise again for the failings set out in this report.
Copies of the report have been laid before the House.
[HCWS607]
Grand Committee
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Arrangement of Business
(4 years, 1 month ago)
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The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
My Lords, the hybrid Grand Committee will now begin. Some Members are here in person, respecting social distancing, while others are participating remotely, but all Members will be treated equally. I must ask Members in the Room to wear a face covering except when seated at their desk, to speak sitting down, and to wipe down their desk, chair and any other touch points before and after use. If the capacity of the Committee Room is exceeded, or other safety requirements are breached, I will immediately adjourn the Committee. If there is a Division in the House, the Committee will adjourn for five minutes.
The microphone system for physical participants has changed. Your microphones will no longer be turned on at all times, to reduce the noise for remote participants. When it is your turn to speak, please press the button on the microphone stand. Once you have done that, wait for the green flashing light to turn red before you begin speaking. The process for unmuting and muting for remote participants remains the same.
The time limit for the following debate is three hours. The timing is quite tight, so I urge speakers to keep to their time.
Comprehensive Economic Partnership (EUC Report)
(4 years, 1 month ago)
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Lord Goldsmith
That the Grand Committee takes note of the Trade Agreement between the United Kingdom and Japan for a Comprehensive Economic Partnership, laid before the House on 23 October (16th Report from the European Union Committee).
Lord Goldsmith (Lab)
My Lords, this debate is on the UK-Japan trade agreement, on which the International Agreements Sub-Committee reported last week. I shall provide a summary of its key findings, but the debate is also an opportunity to talk about the process of scrutiny with a test case before us. It is a novel process, and we can draw some initial conclusions about what works well and what does not. I trust that Members will permit those remarks about the bigger picture. I look forward to the debate and to hearing what noble Lords will say; I look forward in particular to the maiden speech of the noble Lord, Lord Darroch of Kew, about which more will be said later.
The report is the culmination of months of talking to stakeholders and discussing negotiations in confidence with the noble Lord, Lord Grimstone, who is in his place today and has been generous with his time—I thank him for that on behalf of the committee—and senior officials, including the chief economist and the chief negotiator. We also spoke to and corresponded with the Secretary of State before the summer.
The International Agreements Sub-Committee has sought to work in a complementary fashion with the Commons International Trade Committee, whose report on CEPA largely concurred with ours. The report principally contrasts CEPA with the JEEPA—the Japanese-European agreement that existed and still does—looking to understand impacts of any deviations and what stakeholders wanted the Government to achieve. Parliamentary scrutiny is a second route for their concerns and ambitions to be heard, and we tried to do justice to that evidence base in our report.
Where appropriate, we have considered the Government’s published objectives, but they are, to be frank, generic, and the Government have not cross-referenced CEPA with those published aims to set out whether all of them in their view have been effectively met. Parliament is not involved at the moment with that objective-setting process. We can say after the fact whether we think that they got the objectives wrong and what other objectives might have been sought, but our role here is severely limited. That is a matter which the House may wish to think further about.
We have also evaluated the Government’s final claims about what CEPA achieves and what it does not. Our principal conclusion in this regard is that the Government have oversold several provisions in a way that risks undermining what is ultimately a respectable continuity-plus agreement.
Looking at our specific key findings and starting with the successes, we note that CEPA goes beyond JEEPA in some of its digital and data provisions, which is welcome. This will benefit UK and Japanese businesses across sectors, in particular those in service industries. Those provisions have found favour with many of our witnesses, such as the City of London Corporation and the Motion Picture Association. However, some others, such as the consumer organisation Which?, and the Open Rights Group, have asked whether CEPA’s provisions might indicate a change of thinking from the Government about how to ensure the protection of personal data. Overall, we did not view CEPA as creating a potential personal data protection loophole, but we would be interested to hear from the Minister whether the UK envisages diverging from the EU on data protection.
Another key area of provisions relates to agri-food products. Those provisions are split through several chapters in our report, but I shall summarise them here together. First, overall, CEPA is useful to UK producers. Tariff reductions and their staging are maintained, allowing UK exporters to continue to be competitive with EU exporters. I do not really want to mention the supposedly cheaper soy sauce—the little incident on Twitter—but Members may recognise that as an allusion to an unfortunate and wrong statement that the deal would make soy sauce cheaper. Our report covers some areas such as trade in malt and tariff-rate quotas because the Government made quite a big deal of them, although they are relatively small in trade terms. Regarding the malt trade, the Maltsters’ Association of Great Britain told us that this agreement
“offers the same benefits as the existing system”—
access to the Japanese market tariff free through Japan’s autonomous tariff-rate quotas—yet the Government have advertised CEPA as delivering “more generous market access”. The Minister might like to comment on that.
Tariff-rate quotas, or TRQs as I will call them, were one of Japan’s key concessions to the EU to avoid greater liberalisation of tariff lines. Japan liberalised 97% to the EU’s 99%. In this UK deal, 94% of Japanese tariff lines are liberalised, to 99% of ours, but CEPA maintains access to only 10 of JEEPA’s 25 tariff-rate quotas, and then only after EU exporters have used them as much as they wish. That creates some uncertainty for UK producers and Japanese importers, who may now need even to provide bankers’ guarantees when importing UK products lest additional duty eventually needs to be paid. That does not make UK goods attractive, and access for the UK via the headroom left by the EU may disappear in only a few years. The Government say that joining the CPTPP will fix this, but that seems a contingent basis for dismissing the difficulties that exporters will face.
Finally, on a matter on which other noble Lords may touch later, there are new provisions for geographical indicators. The Government advertised CEPA as though they had won these protections, but in fact there is still an application process to be completed during which there may be objections from any of the 11 CPTPP countries or other producers.
Turning beyond agricultural and food products, CEPA has significant effects on trade in other goods. We thought particularly and had evidence particularly about automated manufacturing, as that is an area of key inward investment in the UK. Let me be clear: CEPA’s provisions are necessary and therefore welcome, but they are not sufficient. CEPA enables UK and Japanese manufacturers to use EU products and count these as their own for the purposes of cumulation. However, what the Society of Motor Manufacturers and Traders and the North East England Chamber of Commerce told us was most vital was cumulation for products exported to the EU. CEPA cannot deliver this on its own; only the UK-EU deal can, and it seems increasingly from press reports that it is unlikely to do so. I hope that other noble Lords may cover this topic.
The noble Earl, Lord Sandwich, regrettably cannot be with us for debate today, but I know that he would have wanted to highlight the sustainable development provisions of CEPA—the noble Lord, Lord Oates, may touch on some of these issues later. CEPA retains JEEPA’s sustainable development chapter but does not go any further. We were concerned at the lack of focus on environmental goods in CEPA overall. Cornwall Council highlighted in evidence to us the absence of any mention of green technology and the North East England Chamber of Commerce wanted more attention paid to low-carbon goods and services, including renewable energy, which are an important part of its regional economy.
As for the Government’s impact assessment, that itself notes uncertainty about whether CEPA can increase investment fall and the export potential of low-carbon goods and services. Again, I hope that the Minister will say something more about these issues in his speech.
I will illustrate how these issues are all interrelated. The North East England Chamber of Commerce highlighted that the accumulation of Japanese content in UK automotive manufacturing products being exported to the EU was “crucial”, in particular for electric vehicles, as the EU is not well developed in electric vehicle production and many parts come from Japan.
I will say a word about the Government’s explanatory documents. The brief summary of our findings that I have just given indicates the importance of looking closely at variations from the existing Japanese-EU agreement, JEEPA. However, the Government’s impact assessment does not allow us or the public to answer the question of whether the UK-negotiated deal serves UK businesses and consumers better than the existing one. The impact assessment compares CEPA only with no deal with Japan—that is, with WTO terms.
The committee does not want to use this report to relitigate Brexit, of course; that was not the purpose or intent behind that conclusion. However, we think the question is important and that the information to answer it should have been provided. We note that the Government’s own impact assessment of JEEPA estimated a GDP increase of £2.1 billion to £3 billion. That is much more than CEPA’s estimated £1.5 billion boost. We understand that the methodology and context of those two assessments differed, but we believe that the Government should have addressed this issue head on.
Our conclusion is thus forward-looking. For Parliament to best scrutinise the Government’s exercise of their new powers, which will be increasingly important for the country as we develop more new trade deals, we must have the data necessary to judge whether the Government have done a good job.
The Grand Committee previously debated our report, Treaty Scrutiny: Working Practices, and allied reports, when there was significant support for an enhanced mechanism for parliamentary scrutiny of treaties, including trade deals. That has also been evidenced in debates on the Trade Bill, and is likely to feature on Report when it comes about. Our inquiry on CEPA and those on the ongoing talks with the US, New Zealand and Australia—all of which are under way—have all yielded evidence from stakeholders about parliamentary scrutiny processes and their importance. This is not simply Members enjoying an opportunity to talk about themselves, but an important issue that we must get right.
Producing this report has been challenging. It is a testament to the willingness and ability of Members and staff to absorb and consider a vast amount of information quickly that we have been able to produce this report to allow the House to hold a debate within the CRaG scrutiny period. As we said at the working practices discussion, that is a short period. However, success that we were able to produce this report should not lead the House or the Government to think that this has been easy or will be easy in the future. We had notice and we planned accordingly, and because the deal is largely identical to an existing one, it does not raise some of the thornier issues, such as respect for human rights or food standards, that may well arise in other deals and agreements, and still it is very challenging to do CEPA justice.
We said in our working practices report that we reserve the right to recommend changes to CRaG if we conclude that, overall, the required pace is detrimental to the House’s scrutiny function. Nevertheless, I want to recognise that DIT has worked hard to make the process as it is work as well as it can in the circumstances, and the Minister and his staff should be commended for their efforts—I thank them, and particularly him. I look forward to hearing what noble Lords say in this debate. I beg to move.
Lord Oates (LD)
My Lords, I welcome the opportunity to debate this report. I have the privilege of serving on the International Agreements Sub-Committee and the rapid production of such a comprehensive report is due in no small part to the skills of our chairman and those of the clerk to the committee, Dominique Gracia, and her team, who have done a brilliant job pulling it together in such a constrained timetable.
In the limited time we have available for debate, I want to focus particularly on the data provisions in the agreement, how we use trade agreements to advance decarbonisation and the importance of building trust in trade policy.
First, on data provisions, the IAC received evidence from Dr Emily Jones and Beatriz Kira, of the Blavatnik School of Government at Oxford, which raised a number of concerns. In particular, I hope the Minister can tell us more about the decision of CEPA to expand the scope of protection of mandatory disclosure of source code and software beyond that in the EU deal to include algorithms expressed in that source code. Will the Minister tell us in his response the reason for that expansion, which is a matter of concern given the impact that algorithms can have on decision-making and the need for this to be transparent to the public?
Secondly, as the noble and learned Lord, Lord Goldsmith, has said, while it is welcome that the agreement retains the references in the EU deal to international environmental commitments, including the Paris Agreement, and commits both parties to working to secure mutual environmental aims, it seems like a missed opportunity not to have sought more, particularly on green technologies and services. The impact assessment predicts an increase in greenhouse gases as a result of the treaty, and while in itself it is not a significant increase, we need to think about how we can use trade policy to bring down greenhouse gas emissions, not to raise them—however small the amount may be.
In future deals, we will need to take a radically different approach, and we have an opportunity to do so in the New Zealand negotiations, given New Zealand’s credentials in this regard and its ground-breaking initiative to negotiate an agreement on climate change, trade and sustainability with Norway, Costa Rica, Iceland and Fiji. I hope we will take the opportunity this offers to create a forward-looking trade agreement with New Zealand which puts protection of the planet at its heart.
Next, I want to address the issue of public trust in our trade policy, which has not been well served by the way in which the Government have tried to oversell this agreement. Announcing the deal on 11 September in a press statement, the Secretary of State for Trade said:
“The agreement we have negotiated …. goes far beyond the existing EU deal”.
However, the impact assessment for this agreement suggests that it will increase UK GDP by £1.5 billion per annum in the long term, whereas the impact assessment for JEEPA, the Japanese-EU trade agreement, published in May 2018, estimated that it would increase UK GDP by £2.1 billion to £3 billion over the long term—a significantly larger figure. The Government will doubtless argue that the figures cannot be compared because they are modelled differently. However, if the Government will not provide us with comparative modelling, we can only go by their own previously published figures, and they do not in any way bear out the Government’s claims that this deal provides significant benefits over JEEPA—in fact, they show the contrary.
Overselling in this way undermines trust. That may be less important in respect of this deal, which has not given rise to significant public concern, but it will be a real problem when we come to more controversial deals, such as a potential agreement with the United States. I therefore urge the Minister to ensure that lessons are learned from this experience and, in future, that deals are communicated objectively on their merits rather than spun to be something other than they are. In this case, the Government should simply have stated the reality: that a rollover deal, with a few additions and a few subtractions, had been secured. That was the reality, full stop. That is what the Government should have said.
Lord Lansley (Con)
My Lords, I am very pleased to follow my colleague on the International Agreements Sub-Committee, the noble Lord, Lord Oates, and our chair, the noble and learned Lord, Lord Goldsmith, who has so well set out the basis of our report that I will not follow him in most of that. I will focus on what I think is really important, which is that this is a continuity-plus agreement. I want to focus on the plus, which I think is more significant than people have perhaps yet realised.
I declare an interest. In addition to being a member of that committee, I am the UK chair of the UK-Japan 21st Century Group, which was in online conference with our Japanese colleagues on 11 and 12 September this year, when the agreement was signed. Among our colleagues from Japan were seven members of the Japanese Diet and former Ambassador Tsuruoka, who will be known to a number of Members.
The sense of positive welcome given by our Japanese colleagues to the agreement reflected their view that this was not simply a rollover of the EU agreement—although much of it might look that way—but presaged a significant broadening and deepening of the UK-Japanese trading relationship. I will focus on that. First, on digital trade, I think the EU, because of its lack of a digital single market, continues not to enter the kind of expansive agreements available with other countries. This agreement much more nearly reflects the content of the CPTPP, the Trans-Pacific Partnership Agreement: things such as free flow of data, net neutrality, consumer protection online, no data localisation and more open government use of anonymised data. All of those are really important for digital trade, and the United Kingdom is a world leader in digital trade. For us to have such agreements is increasingly important.
That is also true on financial services, where the lack of potential agreement in the EU-UK agreement is a matter of continuing regret. Here, with Japan, are some starting points much welcomed by the City on facilitating UK firms licensing in Japan, on regulatory co-operation and reference and deference to each other’s regulatory structures and, generally for service industries, the mobility of staff and their families to work in Japan.
There are improvements on agricultural tariffs and things such as the administrative scheme enabling more geographic indications to be protected in the Japanese market—they are modest, but they can be developed, as the noble and learned Lord, Lord Goldsmith, said, in the CPTPP context, as long as we make progress there. I think we can and we will. It is not unimportant that Japan holds the chair of the CPTPP in 2021, and things such as digital trade developments and agricultural market access will be much improved if we are able to accede to the CPTPP. I hope that the Government will take that forward early in the new year.
The plus also includes areas where we want to go further—on financial services, on mutual recognition of qualifications, on the ability of people from this country to go to work in Japan, on the environment and sustainable development and for there to be an investment chapter, given the relative significance of Japanese investment in this country and that in the opposite direction, and in audio-visual and creative industries, where both we and Japan are world leaders and should be encouraging continuing trade. The noble Lord, Lord Foster, may want to say something about that.
Finally, using this agreement is really important, and I commend our colleagues in the embassy in Tokyo, because they recently appointed a digital trade and an agricultural trade attaché. If they, business, including SMEs, and the department use this agreement fully, we can make this a significant increment to our UK-Japan trade.
Lord Trees (CB) [V]
My Lords, I am sure that all of us welcome this trade agreement—the first post-Brexit trade agreement—and may many successful agreements follow. However, it is being scrutinised under the so-called CRaG rules, and it illustrates the limitations of that system with respect to parliamentary scrutiny, as was emphasised by the noble and learned Lord, Lord Goldsmith, in his opening remarks. There has been no input into negotiating mandate or oversight during negotiations, no proper involvement of devolved Administrations and no guarantee of a vote at the end of the debate. There has been very limited time for consideration by parliamentary committees.
For all those reasons, I welcome Her Majesty’s Government’s recent agreement to not only set up but extend the life of the Trade and Agriculture Commission for at least three years and to require the Secretary of State to lay a report before Parliament with regard to free trade agreements involving agricultural products, explaining their consistency with UK statutory protection in relation to human, animal and plant health, animal welfare and the environment.
Returning to this UK-Japan agreement, I shall focus on my particular interest in standards of food products, animal welfare and the environment. We were assured by the noble Lord, Lord Grimstone, in a letter of 11 September that, with reference to the Japan agreement,
“we have maintained all existing protections for our high standards of … animal welfare”.
How will we ensure that imported food products have been produced to standards no lower than our own, and who will do that? I ask that in the knowledge that the World Animal Protection ratings for animal welfare in general are E for Japan compared to B for the United Kingdom; and for farm animal welfare legislation, G for Japan, lower than the UK’s rating of D. Japan has no specific legislation on animal transportation, the rearing of pigs, laying hens or chickens, and it still permits sow stalls and conventional battery cages for chickens—all in contrast to the range of legislation on these subjects applicable in the UK and to our UK farmers. Furthermore, it is not clear how many of the 14 farm animal welfare guidelines of the World Organisation for Animal Health—the OIE—Japan has put into law. Of global significance is the fact that there is no reference in the agreement to antimicrobial resistance or measures in Japan to reduce antibiotic use in farm animals. In fact, in general, there is little reference to animal welfare standards in the UK-Japan agreement.
The Department for International Trade’s impact assessment on animal welfare is very limited, but it does state that
“imports will continue to meet the UK’s food safety standards”.
I do not doubt that food safety standards will be met—we have the FSA and the FSS to ensure that—but food safety is not the same as welfare standards. The former relates to the safety of the edible products from animals, the latter to how those animals were kept. These are different issues which require different expertise and processes to audit.
It is welcome that provisions in the UK-Japan trade agreement commit both parties to co-operation on matters of animal welfare. In addition, the DIT has committed to scrutiny of animal welfare standards in free trade agreements through a range of measures, including, where appropriate, assessments of animal welfare impacts. But the Regulatory Policy Committee report which assessed the DIT’s impact assessment stated that it should have given more detail on the impact on animal welfare and identified animal welfare as an area to be improved in future impact assessments. How will the DIT do that? Does it have the relevant expertise? Will the DIT fully utilise the Trade and Agriculture Commission? Particularly with regard to breadth and depth of expertise, will it co-operate fully with Defra on this?
I would welcome a response from the Minister to those questions which will provide further assurances that, in future trade agreements, the UK’s standards will not be compromised.
Lord Hain (Lab)
My Lords, I look forward very much to the maiden speech of the noble Lord, Lord Darroch, with whom I worked very productively when I was Europe Minister and who has the great virtue of being a Chelsea fan.
The EU-Japan agreement, from which the UK, as an EU member, has benefited, entered into force on 1 February 2019 and is the world’s largest bilateral trade deal, creating an open trading zone covering nearly one-third of global GDP. In his evidence to the International Agreements Sub-Committee, the Minister, the noble Lord Grimstone, confirmed that this new agreement with Japan is a “continuity” agreement. His departmental colleague confirmed that
“in almost all respects the tariff liberalisation is the same as it is in the EU agreement”.
It is therefore surprising, perhaps, as the noble Lord, Lord Oates, pointed out, that the Secretary of State, Liz Truss, called the agreement a
“ground-breaking, British-shaped deal”,
which she said went far beyond the existing EU-Japan trade deal. On 19 November, when questioned by the shadow Secretary of State, Emily Thornberry, she was unable to explain how this was the case, and has failed to produce any economic modelling to prove otherwise.
A government impact assessment in October found that the £15.66 billion projected boost to bilateral trade claimed by the Government was, in fact, a comparison with no trade deal with Japan, rather than with the existing EU-Japan deal. It also showed that of these benefits, 83% would go to Japanese exporters and only 17% to the UK’s. Officials confirmed that the deal was expected to add a mere 0.07% to UK gross domestic product, and this was again as compared with no deal with Japan, rather than with the status quo EU-Japan deal.
The UK had sought access to tariff-rate quotas for value-added agri-food exports such as cheese. As the Japanese had promised their farmers that there would be no such new quotas, Britain failed to secure these, and instead has to use any quota left over by the EU in only 10 out of 25 such products covered by the EU-Japan agreement. Moreover, the UK Trade Policy Observatory found that all the tariff “wins” claimed by the Secretary of State are for goods that the UK does not actually export to Japan. The 10 products concerned include obscure items such as birds’ eggs, raw hides, fur skins, and ultra-strong spirits of at least 90% alcohol. The gain to British exporters was therefore found to be “zero”.
The trade observatory study also concluded that:
“In services and investment liberalisation, it is clear that Japan’s commitments to the EU and the UK are almost identical”.
Foreign direct investment is therefore one notably important area missing from the deal. The UK is Japan’s second-largest destination for FDI, totalling £131 billion in 2019. Japanese investment supports over 100,000 jobs in the UK in sectors such as manufacturing and scientific research. However, as Mr Motegi, the Japanese Foreign Minister said, at the signing of the deal:
“It is of paramount importance that the supply chain between the UK and the EU is maintained even after the UK’s withdrawal.”
He therefore had “high hopes” of a deal between London and Brussels—as I trust that we all do.
As the Financial Times pointed out on 13 September, the UK-Japan deal commits the UK to tougher restrictions on state aid than those that it has said it would accept in the context of a trade deal with the EU. Why, then, do the UK Government continue to regard state aid as a make or break issue for the crucial trade talks now taking place with Brussels?
The UK has said that this deal will be a stepping stone to the UK’s membership of the Trans-Pacific Partnership, but trade deals with countries on the other side of the world cannot replace those with the EU, the biggest and richest market on our doorstep, worth 47% of the UK’s trade in 2019.
The Government have sought to overplay the significance of the UK-Japan trade deal as cover for the chaos looming if the UK fails to secure an EU trade deal. As the Guardian business leader said on 13 September:
“A Japan trade deal is little consolation if Britain is locked out of the EU.”
Lord Foster of Bath (LD)
My Lords, as a relatively new member of the IA committee, I have been impressed by the expertise of fellow members; by the skill and professionalism of the committee staff, to whom great credit must go for this report; and by the dedication and, above all, patience of our chairman, the noble and learned Lord, Lord Goldsmith.
Whatever the merits of the Government’s claim that the Japan deal is more than a rollover of JEEPA, it should be welcomed as providing
“valuable continuity for businesses, consumers and other stakeholders”,
and as a stepping stone to joining the CPTPP. But it is nowhere near as ambitious as many had hoped. Agreement to negotiate a deal was not reached until January last year, but it was a further 17 months before negotiations even began, so they had to be conducted at pace. I congratulate our negotiators on what they were able to achieve in such a short time, but it meant that nothing that required any change to primary legislation in either country could be included. Hopes for an ambitious deal were dashed and many proposals from consultees had to be ditched, calling into question the claim that this is a comprehensive deal.
Indeed, as other noble Lords have already pointed out, there are several examples of the Government overselling the deal. I hope that the Minister will accept that criticism. I note also that the UK’s overselling is in marked contrast to the Japanese who, despite appearing to gain far more from the deal than we do, have been much more muted. But working out those gains is difficult given current limitations in economic modelling and because, unhelpfully, the Government have compared the deal against trading on WTO terms rather than against JEEPA. I hope that this will not be the case in future deals.
Operating on a compressed timetable reduced ambition, but it also meant confusion and disappointment for the numerous stakeholders. The intellectual property chapter provides a good example. Of those aspects impacting the creative industries, our report says that, despite government claims of significant improvements on JEEPA,
“many of the additions focus on future discussions and awareness raising about existing enforcement procedures in both countries, rather than securing new … protections.”
To protect IP, the creative industries had sought much more. They wanted tougher measures to enable blocking of websites containing illegal content, along the lines that we already have in our own Digital Economy Act —but they did not get them. Can the Minister confirm that the UK will be reliant upon Japan’s existing IP enforcement procedures and that the deal does not commit Japan to any specific changes to those procedures?
The other two creative industry asks—public performance rights and artist resale rights—were not achieved either. Does the Minister acknowledge that stakeholders were given inaccurate expectations of what could be achieved in the deal?
The creative industries and other sectors may benefit from provisions on digital and data. But, as my noble friend Lord Oates pointed out, there are concerns about those provisions. One is that they could herald the lowering of our current GDPR-based data protection standards, perhaps to enable us to gain admission to the CPTPP given the lower standards of data protection in the Asia-Pacific region. In JEEPA, onward data flows are specifically excluded. Under CEPA, however, data which flows from the UK to Japan could be passed to other countries, through trade deals that Japan has with those countries, where lower data protection standards apply, thereby giving reduced protection to the personal data of UK citizens. I am not a believer in conspiracy theories, so will the Minister give an assurance that nothing in this agreement, or any future agreements, will reduce the standard of protection of the personal data of UK citizens from what is currently enjoyed?
This is a welcome deal because of the continuity that it provides. But it is little more than a rollover deal, one which has been oversold by the Government, appears to be far more beneficial to Japan than to the UK, and for which the Government have not even provided analysis to enable comparison of it with what we currently enjoy.
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
My Lords, the Grand Committee will now resume with the noble Lord, Lord Lilley.
Lord Lilley (Con)
My Lords, I welcome this trade agreement, not only because it secures the benefits of the existing EU-Japan free trade agreement. It goes beyond that, especially in digital and data, and, potentially, on geographic indicators and rules of origin, and it helps to pave the way for our future membership of the TTP, or the CTP—you know what I mean.
Before elaborating on those aspects, I repeat my habitual warning, like a cracked record, about the excessive importance attached to trade deals in public debate in this country and, indeed, in your Lordships’ House. Trade agreements like this are useful but far less important than most people imagine. What really drives trade is producing goods and services that people want to buy then getting out and selling them, preferably aided by a competitive exchange rate. Sadly, a significantly lower proportion of British small and medium-sized enterprises engage in international trade than is the case for similarly sized companies in our major competitors. That weakness in our business culture has been exacerbated by an exchange rate sustained at an uncompetitive level by the sale of assets, rather than by selling as much goods and services as we import.
This agreement with Japan is sometimes belittled, not just relative to the existing EU-Japan agreement but because it is not nearly as deep as the single market arrangements that we are leaving at the end of December. It is the accepted wisdom that the European single market represents the most comprehensive and deepest trade agreement that exists, whereas the WTO is treated as of little fundamental importance. I happened to be the Secretary of State for Trade and Industry who had to implement the single market legislation and helped to negotiate the Uruguay round which set up the WTO. Despite the optimistic speeches that I made at the time about how much the single market would boost our exports, we find that, over the ensuing quarter of a century, our goods exports to the 14 countries which founded the single market have little more than stagnated: they have grown by some 18%, barely 0.5% a year. By contrast, our goods exports to the 14 largest countries with which we trade just on WTO terms have grown by 80%—six times as fast—over the same period. As for the impact that either may have had on our GDP, that is almost impossible to assess, even in retrospect; it is certainly imperceptible, looking at the trend in our trade in recent decades.
I am sceptical in the extreme about the figures shown in the impact assessment of this trade agreement with Japan, and even more so about attempts to break this speculative impact down by region. As someone said, such figures serve only to make astrology look respectable. Government statisticians would be better employed trying to calculate cost-benefit assessments of the effect of the Covid restrictions on lives and livelihoods than those of the CEPA.
On the CEPA itself, the most striking element is the agreement on digital trade and data, which, according to the brief, accounts for as much 30% of our trade with Japan—a figure I find it hard to get my head around. If it is correct, the positive measures in this agreement are likely to be important to trade with Japan, and even more valuable as a template for future trade agreements across the world.
The Deputy Chairman of Committees (Baroness Garden of Frognal)
We now welcome the maiden speech of the noble Lord, Lord Darroch of Kew.
Lord Darroch of Kew (CB) (Maiden Speech) [V]
My Lords, I am delighted and honoured to join your Lordships’ House. In my 42 years as a British diplomat, I sometimes sat in the official Box in this House on the deeply questionable basis that I could offer useful advice to the Minister at the Dispatch Box. Later in my career, especially in my last two overseas postings, as ambassador to the European Union and to the United States, I had the honour of giving evidence to committees of this House. I remember in particular two features that stood out whenever I gave evidence: the matchless courtesy with which proceedings were conducted and the forensic accuracy and pertinence of the questions posed. So it is a relief that I am now on the other side of the table.
I start with some words of sincere thanks to the staff of the House for the help that they have given me over the past few months. They have been models of professionalism, not least the IT expert who spent more than an hour on the telephone to me—though to him it must have seemed much longer—helping me with the theoretically simple task of setting up my email account.
There is a particular reason for my choice of this debate for my maiden speech. Tokyo was my first overseas posting, and I was there for four and a half years in the early 1980s, so there is a certain symmetry in UK- Japan relations being the focus of my first intervention in the House.
I was in the political section of the embassy but, at that time, there was absolutely no question about the central task of the embassy: it was about the economic and trade relationship, opening up the Japanese market and encouraging Japanese investment in the UK. If anyone ever thought that diplomats were interested only in political and national security work and not in trade or inward investment, they should have seen the British embassy in Tokyo in the early 1980s.
While it was nothing to do with me, labouring away in the political section, my colleagues in Tokyo succeeded —it took a while—in opening up the Japanese market. Tariffs and quotas were reduced or eliminated, and the first big Japanese investments—notably the Nissan factory up in Sunderland—were enticed to the UK, all of which paved the way for a substantial boost to the commercial and investment links between the two countries and the thriving bilateral relationship that we see today. A lot of officials, diplomats and Ministers have played a part in this progression, but I like to think that the seeds were planted by my economic and commercial colleagues in those now distant early 1980s days, back in the Tokyo embassy.
That brings me to this new UK-Japan Comprehensive Economic Partnership Agreement. I start by congratulating the International Agreements Sub-Committee on its report on the agreement, which is an excellent piece of analysis, and the summary of conclusions and recommendations is a model of its kind. I am tempted to say that I agree with every one of them and leave it at that, but, having got the Floor, I would like to offer briefly three reflections.
The first is to highlight one of the central themes of the committee report: the overselling of the gains of this agreement. This is not to discount or diminish the work of our negotiators. I spent many hours negotiating around the EU table and know that negotiations are always a hard slog. But to quote the committee’s report, the Government are
“presenting as a new gain the retention of EU negotiated provisions.”
There are some modest advances, such as faster reductions in tariffs on, for example, leather goods, some more liberal rules-of-origin provisions, and some improved financial services provisions. However, there are also some deficiencies in comparison with the EU agreement—in particular, the arrangements for continued access for UK companies and some tariff-rate quotas are suboptimal and introduce uncertainty. There is further uncertainty about whether UK exporters will actually gain the additional 60 or so geographical indicators that are promised, and around how the provisions of this agreement on application to Northern Ireland will work in practice.
With so little good news around in these coronavirus days, I can understand the temptation to talk up successes. I repeat that it is good to have this agreement, but overselling always brings consequences down the track.
Secondly, the committee’s report highlights the important succession to the Trans-Pacific Partnership Agreement. I strongly agree. This is the part of the world enjoying the strongest economic growth, and it is coping with the pandemic better than Europe or the United States. The stronger our trade relations with the region, the better for the UK in the medium term.
My third point is a wider one. As the report notes at paragraph 105, the Government have estimated that the agreement with Japan will increase GDP by 0.07% a year, though they have not offered a figure for what benefits the agreement brings over and above those that were enjoyed by the UK as a member of the EU-Japan agreement. I note that in another part of the post-Brexit forest, the Government have estimated that a free trade deal with the US would boost the UK economy by 0.16% over the next 15 years. I point out the contrast between these figures and the impact on the UK economy of no-deal Brexit. A recent study by the London School of Economics estimated that no-deal Brexit would have a long-term impact on the UK of 8% of GDP—that is not too far from the Government’s own forecast, back in 2018, of 7.6% of GDP.
The point is obvious: these trade deals with the likes of Japan and the US can have a positive but modest impact on our future economic growth, but they are dwarfed by the implications—positive or negative—of the current negotiations with the European Union. Nothing is more important than a successful outcome to that process. This is, I recognise, hardly an original or controversial point, but the clock is ticking, it is the 11th hour, and the risks are growing.
Lord Kerr of Kinlochard (CB) [V]
What a privilege it is to follow the noble Lord, Lord Darroch, and be the first to congratulate him on an excellent maiden speech. We come from the same Diplomatic Service stable, where, in Washington, Brussels and Whitehall, he served five Prime Ministers with verve and distinction. He was famous in our service for hard work, good judgment, a certain joie de vivre and conspicuous loyalty to his team. I was rather luckier than him in some ways, because the Presidents I watched in Washington were rational and predictable, and all the Prime Ministers I worked for saw loyalty as a two-way street. We have just had an insight to and foretaste of the huge contribution that the noble Lord, Lord Darroch, will, with his wisdom and experience, make in the House. Despite his being a Chelsea fan, I welcome him very warmly.
As a member of the committee, I begin by congratulating the noble and learned Lord, Lord Goldsmith, on his judicious and magisterial chairmanship. I also congratulate the noble Lord, Lord Grimstone, and thank him for his courteous and co-operative relationship with the committee. I particularly congratulate our clerk, Dominique Gracia, who mustered our thoughts graciously, skilfully and fiercely
I am one who welcomes the agreement and think that its principal merit is continuity; it prevents a cliff edge on 31 December. There are small pluses—on digital, on data and on regulatory co-operation, though nothing on investor protection and no separate chapter on digital—and there are minuses. There are minuses on TRQs, as the noble Lord Darroch, has said, and on geographical indicators. I would not make a big deal of these minuses—indeed, I would not mention them at all—but for the fact that the department chose to present them as pluses by comparing the deal not with the status quo of the EU deal that we have enjoyed up to now but with the straw-man of what WTO terms would have been.
I join the noble Lords, Lord Foster, Lord Hain and Lord Darroch, in warning of the dangers of overselling. It is actually unfair to our negotiators, who have produced a perfectly respectable rollover deal, that there should be Twitterstorms and criticisms over claims that are, at best, exaggerated. I think it would be wise, if we are comparing the benefits that we will secure from the agreement, to compare them with the status quo.
These points have been well made and I do not want to labour them. I would like to make a different and more general point. For 40 years, the dominant factor in our economic relationship with Japan has been its inward investment in this country, first in electronics, then in the automobile sector and then more widely. The benefits to us have been enormous, not just in employment but in learning from Japanese production techniques of automation and now digitisation. The Japanese came here because they saw us as a springboard into Europe. I was one of those who, despite strong Italian and French opposition, persuaded Jacques Delors’s Commission that Nissan’s investment in Sunderland would produce European cars, not Japanese cars, and they would be just as European as Fiats or Peugeots. If we had failed, the Japanese would not have come here. What worries me now that Sunderland is outside the single market—which Jacques Delors, Leon Brittan and Margaret Thatcher built—is that the Japanese may be forced to take a different view. Whether Nissan and Toyota now pull back—or, worse, follow Honda and pull out—depends not on the agreement that we are discussing today but on the agreement we strike with the European Union and what it says about rules of origin and what the return of customs formalities and frontier checks means for just-in-time supply chains. We must cross our fingers and hope for a no-tariff deal and minimal frontier friction. If we do not get those, the relationship with Japan will wither.
For all the fine talk of Asian opportunities and the CPTPP, the rule of thumb for trading in goods is that trade halves as distance doubles. That is why the Japanese have chosen to make things here, and if we lose them the European market, we will lose them, full stop. They will make things in continental Europe instead. I hope that the Prime Minister understands that.
Lord Risby (Con)
My Lords, it is a pleasure to be a member of the International Agreements Committee, and I warmly congratulate the noble Lord, Lord Darroch, on his speech.
I begin my remarks by referring to our trade and investment exports, which in recent years have been supported in a transformed way. For the past eight years, I have been one of the Prime Minister’s trade envoys. It has been a dramatic change, not least of course the huge expansion of the facilities of UK Export Finance.
It is widely accepted that the UK-Japan agreement is not significantly different from the precedent of the EU-Japan agreement, and inevitably there will be caution in Japan pending the outcome of the Brexit talks, most particularly on trade and goods. But given that the only committee briefing I have participated in was on financial services, it is appropriate that I should confine my remarks to services and data. Last year, 56% of service exports to Japan were financial, so there is certainly further scope, and an agreement has potentially opened the door to that and, importantly, to further regulatory co-operation in financial services and digital trade.
We all know how often individual countries are most reluctant to embrace fully foreign banking and insurance activity. There is considerable professional admiration for our financial service structures. The CEPA, including our three pillars—HM Treasury, the Bank of England and the Financial Conduct Authority—sends a clear signal. It is now possible for our financial services to offer products on the same basis as Japanese companies, but that has to involve mutual trust. Although it is the intention that meetings will take place regularly, it will be done within a voluntary framework, not forced, with regulators eventually controlling the dialogue. I wonder whether my noble friend the Minister believes that this voluntary framework adequately sets out a mutually beneficial trajectory.
If we look at CEPA as the basepoint for future advances, during our time as members of the European Union, in my view we greatly benefited from mutual professional recognition. My understanding is that this matter will be explored further and is to be strongly encouraged. Again, my noble friend may wish to express a view on how we can take this matter forward.
What is gratifying is that both Japan and the United Kingdom instinctively favour open economies, but work needs to be done to address the challenges of digital e-commerce, given that half of services trade is now digital. This is a hugely sensitive area, not least to prevent money laundering and enforce the know-your-customer rule.
It is also clear that the matter of investment protection needs to be revisited; again, perhaps within a voluntary mutual context, but certainly that of a defined dispute resolution that may require additional powers.
Unfortunately, the view on trade matters of both countries is not widely shared internationally. However, I acknowledge that both Governments, in being committed to the free flow of data, are also committed to a legal framework that provides for the protection of personal information. This is certainly an area that is beset with potential concern and abuse, so it is good that CEPA addresses only data flows between the two countries directly, with onward transmission abroad disallowed. This is an understandable concern with regard to personal and medical data, but the two countries are of like minds, as indeed are New Zealand and Australia.
Thus, while it is perfectly true that CEPA largely mirrors the Japan-EU agreement, the architecture has been put in place for future digital advance. It is not a matter of controversy that higher levels of economic growth are forecast for countries broadly in the Pacific basin. I hope therefore that the successful conclusion of CEPA will open the way to our participation in the CPTPP in due course, not only for economic but for geostrategic reasons, bringing together countries that believe in open markets at a time when their value has been challenged, with negative consequences for world trade and prosperity.
I believe that the committee’s report clearly points to areas where further clarity and progress can be advanced.
Baroness Liddell of Coatdyke (Lab) [V]
I am delighted to join in the congratulations to the noble Lord, Lord Darroch, on his excellent maiden speech. As both a Minister and a cuckoo in the nest of the Diplomatic Service, the noble Lord was one of those I always looked up to—including, of course, the noble Lord, Lord Kerr of Kinlochard. The noble Lord, Lord Darroch, is joining us at a critical time and we look forward to his judgment.
I am also delighted to be a member of the International Agreements Committee. I welcome the UK-Japan Comprehensive Economic Partnership Agreement, but like my noble and learned friend Lord Goldsmith, I have to say that the way the deal has been oversold detracts from what is in the agreement, and it tends towards scepticism about progress on other agreements. I hope that those who are responsible for the overselling recognise that, so that we do not have this in other agreements. I am sure that the uncertainty about the outcome of the UK-EU talks means that there must be question marks around the rest of the agreement, not least the fact that it was measured against WTO rules. That was regrettable.
While I welcome the improvements in data and digital to which others have referred, I feel that the agreement lacks a proper investment chapter, which is a critical key to maintaining Japan’s interest in the UK. That could come from greater investment by the UK to Japan, not just in the other direction. The UK will no longer be a gateway to the EU, so an investment chapter would have mapped out continued encouragement for future Japanese investment throughout the economy. There is a real need to seek opportunity and to consolidate it, and we should be seeking a bigger export market for UK goods into Japan. At the moment, the UK exports more to the Netherlands than it does to Japan; we have to reverse that.
I echo the conclusion of the report of the chair on the agreement that there is a lack of ambition. I do not deny the challenge of getting a deal done against the timetable, but the lack of ambition in the agreement, and the exaggeration surrounding its launch, really does create an atmosphere of scepticism for future deals. Looking closely at the three impact assessments which have been published, we can see that for every pound we make, Japan makes five pounds. We have to get a better balance in something like that.
There is one area about which I have serious concerns. I am worried about the commitment to trade and women’s empowerment. I was greatly encouraged to hear this referred to at the start of the negotiations, because it is an issue for women doing business with Japan, as well as for very talented Japanese women.
The Global Gender Gap Report published by the World Economic Forum since 2006 covers 153 countries. It measures the gender gap between men and women in four areas: health, education, the economy and politics. It has the Japanese at 121 and the United Kingdom at 21. I can find no reference to the Secretary of State referring to women’s economic empowerment as an element in the UK’s trade policy; all I can find is advice on training and the exchange of information and experience, but no binding commitment. More troubling is that Article 21.4 excludes it from CEPA’s dispute settlement procedures. Where I come from, that would be called kicking it into the long grass.
I am also very concerned about the arrangements for SMEs. Can the Minister give us an idea of the extent to which the scoping exercise showed the difficulties that SMEs might encounter in doing business with Japan? What consultations have taken place with representative organisations and is facilitation, and little else, a last point of exercise for SMEs?
It was said earlier that lessons have to be learned for the future handling of these agreements, in particular around the interaction with Parliament. We are not the enemy, but it is our job to scrutinise the interaction that leads to these agreements and, in doing so, make them much more robust. I look to the future and to lessons learned.
Baroness Bowles of Berkhamsted (LD) [V]
My Lords, I, too, congratulate the noble Lord, Lord Darroch, on his maiden speech and look forward to future contributions. I was fortunate enough to be able to rely on his wisdom in his role as the UK’s ambassador in Brussels, which was especially helpful when I became the chair of the Economic and Monetary Affairs Committee and had a scrap or two while finding my feet.
I welcome the UK-Japan trade agreement. Trade agreements are not simple or speedy matters, and the corollary to that is recognition that this one is an achievement—although in my previous EU Parliament role I knew what was going on during trade negotiations and did not have to wait until the end. I have at times wondered what planet trade negotiators were on—and I say that in a friendly way, having once contemplated being one. But the fact is the negotiations are political, detailed, complex and slow. They remind me of the science fiction story “The Waitabits”, where the alien planet operated on such a slower timescale that it was described as “unconquerable”. Maybe that is the point of trade deals; there should be no great victory of one side over another and no conquering, nor any need for exaggerated boasting.
I did not expect massive changes on goods, but there are some interesting things in the detail, such as tariffs on UK products being applied upon arrival rather than applied for in advance, which looks happily streamlined, at least until the point when products arrive to find the low-tariff quota already filled. One hopes that will be worked through to something that really works in the end.
On services, there are changes in direction compared with the EU-Japan agreement, especially digital services, and that gives rise to questions about where they lead over time and what may have become a change in policy that might otherwise have been expected to be in primary legislation. Digital trade moves towards positions in the United States-Mexico-Canada Agreement and setting the UK up for accession to the CPTPP. I understand that positioning, but I am not certain of how much is now rendered a fait accompli and how much marks a potential path that will still have subsequent monitoring by Parliament. Perhaps the Minister could give more guidance on that.
There is no denying that data is important to the digital economy, and there are global differences of opinion on who owns it. Put crudely, the EU considers that it is owned by the individual, the US that it is owned by companies, and China that it is owned by the state. How far down the track from the EU to the US position has the UK gone, and how will Parliament be involved in the detail?
I broadly welcome the agreements around intellectual property but, again, the devil will be in the detail. Simplified trademark registration is welcome. Given the difficulty in protecting algorithms by formal mechanisms, I understand the reasons for agreeing that there should not be forced disclosure. However, can the Minister confirm that this will not result in lack of information concerning accountability and oversight over automated decision-making, especially vis-à-vis individuals’ rights to explanation and inferences? I think the A-level results fiasco taught us all a thing or two about surprising and wrong things that can be found in algorithms and consequential inferences affecting people. It is necessary to be able to have explanations and understanding of the parameters that are used even if algorithms are not disclosed. Can the Minister confirm that requirements for this type of information are not prevented by the agreement?
Lord Howell of Guildford (Con) [V]
My Lords, I join in warmly congratulating the noble Lord, Lord Darroch, and welcome him and indeed his wisdom to our counsels. I declare interests in advising for many years two major Japanese companies and writing a regular column since the 1980s in their newspapers, and as UK chairman for 10 years of the UK-Japan 2000 Group, renamed the UK-Japan 21st Century group when we got to the millennium, which in those days included such legendary giants as “Sony” Morita and Shoichiro Toyoda. However, I want to concentrate here on the less business-related and more strategic significance of this agreement.
The agreement, which is thoroughly modern in focusing on digital trade and services, has had a rather grudging reception in some quarters, like the Financial Times, which has emphasised the undoubtedly small immediate trade aspects compared with large issues like the EU, or, as some have said, a new trade deal with the United States—although I have always been a bit sceptical about the wisdom of disturbing our present very strong trade with the USA by going for something bigger still: a slight case of the dog with a bone seeing the bigger bone in the pool.
This new agreement with Japan has also had a thorough and impressive going-over, as we have heard, from our EU International Agreements Sub-Committee, as well as from the independent Regulatory Policy Committee. It made the point, which I agree with, that we have no bilateral investment treaty with Japan, nor does this agreement create one, which is slightly odd when one considers that foreign direct investment is, has been and will often be the main trade driver.
However, the new agreement is significant for the UK—and maybe for Japan—for a number of reasons that go very much deeper than just trade. It marks a firm step towards the realisation in British policy circles that the future will be increasingly Asian. It could therefore herald a new era of increased collaboration with Japan, not just in trade relations but in much wider fields. For instance, extending the Five Eyes intelligence alliance would be an obvious next step on this front. Opening the gateway for us to join the Comprehensive and Progressive TPP is another, already featured. Aid co-operation could also increase, although it is worth noting in passing that Japan runs an excellent aid programme at only 0.29% of its GDP.
Another shift of huge significance could be about to occur on the UK home front as well. Ten years ago we were all talking about a golden era of UK-China relations, ushering in extensive Chinese involvement in many aspects of the British economy, from nuclear power to railways, ports, property, public utilities and even football clubs. However, in the decades since then, under the rule of Xi Jinping, China has forfeited much of the UK’s broad goodwill by its growingly assertive and prickly attitudes and disruptive policies, not least in Hong Kong. Maybe this will change under better leadership but, meanwhile, it could be that the golden era of UK relations with China is set to be replaced by a golden era of relations with Japan. The trade deal is a harbinger of just that. This would make a great deal of sense, since the two nations working in tandem could be a considerable force for good in a fragmented and frightened world and at a time when the voice and influence of a divided United States has regrettably become “an uncertain trumpet”—at least up until now.
Perhaps the new Prime Minister, Yoshihide Suga, could open his premiership not only by welcoming the new trade deal, as he has already done, but by recognising that this is one step along a road to very much closer co-operation in almost every field—security, defence, culture and intelligence included—and that Japan and the UK, working in harmony, constitute a formidable nexus around which the 21st-century connectivity between east and west can continue to be expanded.
Lord Loomba (CB) [V]
My Lords, I share the Government’s pleasure at signing the trade agreement between Japan and the UK, their first trade deal outside the EU. However, the agreement raises some issues, especially as there appears to have been some overselling by the Government on their achievement in signing it.
The first issue relates to an agreement with the EU on diagonal cumulation, so that goods bought from Japan and then incorporated into British goods can be sold on in the EU with the UK as the country of origin. At this point, we do not have such an agreement in place. This is no small matter, as without it—and time is tight on reaching agreement—businesses may find themselves unable to sell their product in an EU country either at all or, to be able to do so, with increased costs.
Secondly, tariff-rate quotas are problematic for UK companies. For instance, there is a mixed bag for agriculture, with products such as cheese and wheat capable of zero-rate tariffs, while products such as butter, whey and sugar have lost all access to lower tariffs.
There also appears to be some confusion over how access to zero tariff-rate quotas will operate in practice. One report suggests that zero rates will be available only once EU companies have used up their share of the quota, while a second believes that the zero rate will be available on point of delivery. One suggests that UK companies will only benefit from anything left after the EU has taken up its share, while the other says that UK companies that get in first will access it. Can the Minister explain the correct position?
Lord Gold (Con) [V]
I too congratulate the noble Lord, Lord Darroch of Kew, on his insightful maiden speech and welcome him to the House. I am sure that, when we return to normal business, we will all want to hear his reflections on the soon-to-be-ending Trump White House.
The Government are to be commended for securing a new economic partnership with Japan in what has been an extremely short timespan when compared with normal trade negotiations. The achievement is particularly notable, as this is the first time that the UK has had to negotiate a trade treaty in some 40 years. When asked by the EU International Agreements Sub-Committee to identify the most significant feature of this agreement, one witness stated that it was in securing the agreement itself, in that by concluding an agreement we have avoided a trade impasse from 31 December and avoided being at a competitive disadvantage with EU exporters, which would have been particularly damaging.
Although the Government’s aim in their negotiations was to create an agreement as ambitious, high-standard and mutually beneficial as the EU-Japan economic partnership agreement, enhanced in areas of mutual interest, the reality is that this is a rollover of the EPA with certain additional features. As some have said, it is a rollover or continuity-plus agreement. This in itself is to be commended.
In acknowledging this achievement, however, there was no need to oversell what had been achieved, which, as other noble Lords have pointed out, the Government have to some extent done. As the report acknowledges, the agreement provides valuable continuity for businesses, consumers and other stakeholders and it avoids a return to WTO trading terms. Those negotiating our post-Brexit arrangements with the EU should please take note.
However, as other noble Lords have stated, the agreement is not perfect. For example, with regard to tariff-rate quotas for agriculture and food exports to Japan, the EU is given priority and the UK can only use the remaining headroom if there is any. Importers will not know until some time after purchase whether the imported items attract duty. Indeed, they may even have to pay the duty in advance or give security without knowing whether duty is payable. These factors may well be a disincentive to purchasing British products.
Nevertheless, the add-on features to the Japan agreement may prove significant, particularly in financial services and in relation to digital and e-commerce. The agreement also offers a potential extension of geographical indications for unique British products from seven to potentially over 70, although whether this can be fully achieved is at present somewhat speculative and may take some time.
In its work, the sub-committee, of which I have had the honour of being part, has learned a great deal, both on the way in which scrutiny of treaties might be undertaken and on how the process of negotiation might be improved. The Government have established a series of new trade advisory groups, which will identify business needs and set out what they seek in their aims for the negotiation. For true benefit to be gained from these advisory groups, it is necessary that they are kept informed and that there is an open dialogue with the relevant group so that those negotiating the treaty are aware of any worrying concerns and can hopefully cover these in the negotiation. Once the text is drafted, it may be too late to make changes.
The CRaG procedure provides a tight timetable for scrutiny of new treaties. By briefing the sub-committee in both public and private sessions and by providing confidential access to documents, the department has enabled the committee to undertake its work far more efficiently than would otherwise have been the case. I hope that the department has itself benefited from timely feedback from the sub-committee as the negotiations have continued and that this will be a regular feature as further treaties are negotiated.
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
I call the noble and learned Lord, Lord Morris of Aberavon. Lord Morris, are you there? Lord Morris, we cannot hear you. We may need to carry on and come back to you if there is time. I now call the noble Lord, Lord Shipley.
Lord Shipley (LD) [V]
My Lords, I congratulate the noble Lord, Lord Darroch of Kew, on his excellent maiden speech and on his clear analysis of this trade agreement.
I am pleased that we are having this debate today and I say at the outset that this trade agreement with Japan is most welcome. I live in a region—the north-east of England—that has benefited significantly from Japanese investment in recent years and wants to go on doing so. The north-east has a long and valued history of trading with Japan, ever since the first official delegation from Japan came to the UK in 1862. The delegation visited two cities, London and Newcastle, to understand better the impact of the Industrial Revolution, where it met civic leaders, engineers and inventors. It was the start of a long and fruitful trading relationship over several decades.
Today, Japanese investment has generated many thousands of jobs in the north-east. Yet we still do not know what our trading relationship with the EU will be in just 36 days’ time. This matters profoundly. This trade agreement is good news in keeping tariffs down, but Japanese companies in the UK need markets to sell into without barriers to their trade. A week ago, in an interview with Reuters, Nissan’s chief operating officer said that its UK business would not be sustainable in the event of a Brexit that added major costs to its business model.
Many thousands of jobs are dependent on the Government securing a good EU trade deal. Is there going to be one? There are, as I said, just 36 days to go. The concerns of the North East England Chamber of Commerce, which we heard about earlier, are amply justified. This is the UK’s first trade agreement on a large scale and it is with our fourth largest trading partner outside the EU, with trade being worth £32 billion in 2019.
It is, however, unfortunate that Ministers were so tempted to engage in hyperbole by claiming that the agreement would increase UK-Japan trade by £15.2 billion over 15 years, somehow forgetting that the estimate of the growth in trade was actually based on the expected increases from before the introduction of the EU-Japan trade agreement two years ago when we were still EU members. Can the Minister confirm what the real increase is expected to be as a direct result of the negotiation of this agreement?
As we have heard, the agreement projects a growth in GDP of 0.07% over 15 years. It broadly replicates our existing agreement via the EU with Japan, with the addition of some important improvements in digital services and in the system of geographical indications. But today trade between the UK and the EU is 20 times bigger than that between the UK and Japan. This agreement will be of limited value if we cannot access EU markets as we do now.
As we have also heard, the EU will remain so much bigger a market for the UK for the foreseeable future, even allowing for possible further access to Pacific markets. Some 50% of UK trade is with the EU, compared with 2% with Japan; that is, £672 billion with the EU, compared with £32 billion with Japan. These are important figures for us to remember as we seek to develop our trading relations with Japan, which we can and must. But to do so requires continued access to EU markets, as we have it now and as so many speakers today have emphasised.
Baroness Hooper (Con)
My Lords, although I am not a member of the committee which prepared this report, as a recently appointed trade envoy for three central American countries—Panama, Costa Rica and the Dominican Republic—I am naturally interested in the very important scrutiny procedures which we will now have to carry out. I congratulate the noble and learned Lord, Lord Goldsmith, and his committee on producing this report in record time. This debate, and yesterday’s in the House of Commons, are therefore very useful in raising issues that need further clarification and, indeed, in emphasising the importance of completing the EU trade agreement.
I should also flag up the fact that I am a long-time vice-chairman of the All-Party Parliamentary Group on Japan, so I am fully aware of the cultural links and the good will which exist between our two countries. This, I believe, will be helpful in interpreting the deal in the future and in resolving any disputes that may arise.
As the 18th speaker in this debate, I am aware that many of the questions which I had in mind have been well aired, so I will confine myself to three. First, on the ongoing analysis and monitoring that are envisaged, the analysis which caught my eye and on which the deal was based suggests that there will be a trade increase of £15.7 billion and an increase in UK workers’ wages of £800 million, compared with the 2019 levels. That is quite a statement. What procedures are envisaged to check that these statements are fulfilled? Will it be left to Parliament to initiate debates and question Ministers or are the Government committed to regular reporting?
Secondly, since we recognise that trade agreements by themselves do not create trade, it is a question of boots on the ground; my noble friend Lord Lilley underlined this and the noble Baroness, Lady Liddell, also talked on this front. In terms of trade promotion for SMEs in particular, what plans do the Government have to encourage SMEs to get involved? I believe that on the whole the big boys can look after themselves but SMEs certainly need support and, as a result, may be able to take advantage of some of the new niche business opportunities that are made available as a result of this agreement.
Thirdly and finally, I am tempted to raise the issue of energy. As the Energy Minister in your Lordships’ House way back in the 1980s when we were privatising the electricity industry, we stood shoulder to shoulder with Japan on the subject of nuclear energy being a clean energy. There was a particularly memorable meeting of the IAEA—the International Atomic Energy Agency—in Paris when Sweden was urging the closing down of all nuclear production, when that relationship was very useful. But in the context of today and of this debate, green energy and renewables have to be at the forefront. What are the Government’s expectations on this front?
Lord Bilimoria (CB) [V]
My Lords, the total trade in goods and services between the UK and Japan was almost £32 billion last year. Japan is the world’s third largest economy and the UK is the fifth or sixth largest, at any time, and a major importer and exporter of goods. The UK is currently Japan’s 12th largest trading partner, accounting for 2.1% of all Japanese trade.
The deal has further economic significance because it lays the foundation for the UK’s future accession to the CPTPP, as many noble Lords have mentioned. Given that Japan is the second largest investor in the north-east of England, the UK could have used the agreement to incorporate commitments to boost and diversify Japanese investment across the country. The next step must be for the Department for International Trade to monitor implementation and launch a targeted campaign to ensure that businesses of all sizes take advantage of the deal. Does the Minister agree? As president of the CBI, I say that we stand ready to work with the Government to promote the deal to businesses in all regions and nations of the UK.
The additional benefits that the deal provides are perhaps not as significant as they might have been had the deal been negotiated over a longer period of time. As has been said, the pressure to secure a deal before the end of 2020 meant that both sides had to be realistic about their ambitions in what was really about four months of negotiations. The strategy was always to secure continuity as a baseline and avoid defaulting on WTO terms. In that regard, the DIT has achieved its aim and deserves full credit.
The Government see the agreement as a platform for the UK’s accession to the CPTPP and their hope was that by joining the CPTPP—whose signatories, let us remind ourselves, make up around 13.5% of global GDP—UK businesses will have improved access to the fast-growth Asia-Pacific region and the ASEAN trading bloc, while increasing the resilience and diversity of UK supply chains in this area.
The deal has huge economic significance. If you compare the UK-Japan CEPA with the EU-Japan JEEPA, the agreement has, broadly, secured continuity of the existing agreements with the EU, with some additional provisions that address business asks. The key areas where it goes further include e-commerce, rules of origin, IP and financial services. UK business sees this Japan CEPA as an opportunity to increase market access in services, reducing obstacles to mobility and leading to the development of a more inclusive labour market. This is particularly important for financial services, which of course are the UK’s biggest export to Japan, accounting for 28% of all UK exports.
The main gain for business in this area is that CEPA contains some new mode 4 provisions, which broaden the scope for obtaining business visas for intra-transferees. UK business also saw this agreement as an opportunity to tailor provisions to address UK-specific concerns and data standard protection, bearing in mind the slightly different approaches to data taken between JEEPA and the CPTPP. Improving intellectual property rules will tackle the counterfeiting of UK products and allow free bilateral data flows to take advantage of the UK Japanese partnerships in R&D innovation and technologies. In these areas, UK businesses will benefit from commitments such as prohibition of data localisation for stricter regulations on IP infringement.
I congratulate the noble and learned Lord, Lord Goldsmith, and his committee on this report. It mentions that the SMEs chapter of CEPA, while welcome, does not in itself offer significant benefit to UK SMEs. Unlike SME chapters in many other trade deals, including the EU-Japan agreement, it simply offers facilitation. As I have said, this is where the Government need to work to encourage businesses to take advantage of FTAs. As president of the CBI, I can say that it stands by to help do this.
The CEPA does not offer a comprehensive stand-alone investment chapter, which would have been of benefit to the UK once it is no longer a member of the EU. The UK-Japan agreement is also important because it sets a baseline for the EU and US agreements.
The noble Lord, Lord Darroch, whom we welcome—particularly as a fellow Chelsea supporter—and the noble Lord, Lord Kerr, in their excellent speeches, stated the importance of the EU, as did the noble Lord, Lord Hain. It accounts for 47% of our trade. If we look at it in perspective, Japan is much smaller. America is our biggest trading partner with 15%, Germany is number 2 with 9% and Holland number 3 with 7%. The whole of the Commonwealth accounts for 10%. This rollover is very important. We nearly did not roll over the Canada deal. It has been rolled over now, but the main point is that the Canada deal rollover is the basis for building on a super-duper bespoke deal for the UK and Canada going forward. Let us hope that we get an EU deal now that can be the basis on which we can build for the future.
Viscount Trenchard (Con)
My Lords, I declare my interests as stated in the register. I thank the noble and learned Lord, Lord Goldsmith, for his report and for introducing this debate today. Having spent 11 years living and working in Japan and a considerable additional period on business trips to the country, I am delighted that the UK-Japan CEPA was the first of our EU trade agreements to be rolled over, as an enhanced continuity trade agreement.
I also welcome the noble Lord, Lord Darroch of Kew, to the House and congratulate him on his impressive maiden speech. The noble Lord and I gained our first experience of expatriate life in the same city, Tokyo, at the same time, which is interesting. I served under six ambassadors in Japan, including the great Sir Hugh Cortazzi, who perhaps was the one person whose effectiveness inspired me to study Japanese seriously.
The committee’s report is somewhat too grudging in its assessment of what has been achieved in only four months and against the predictions of the naysayers. It is perhaps also too reluctant to give fair credit to the political significance of the agreement against the background of Brexit and the launch of global Britain. Does the Minister also agree that it underestimates the importance of the side letter to CEPA, in which the Government of Japan express their firm determination to support the early accession of the United Kingdom to the CPTPP?
Japanese officials have been encouraging the other 10 members of the CPTPP to understand the benefits of UK accession for some time. The US had persuaded Japan to include significant agricultural quotas in its CPTPP schedules, which are still there after US withdrawal. This is one reason why early UK accession makes a great deal of sense. In addition, Japan believes that early participation by the UK and the workings of the CPTPP will maximise British influence, which will help to ensure that the CPTPP develops as a global beacon and exemplar of the benefits of rules-based free trade, contributing greatly to growing prosperity for many millions across the world.
In May 1998, I was honoured to be allowed to introduce a debate in your Lordships’ House on the state of Anglo-Japanese relations at the time the then Emperor and Empress of Japan arrived for their state visit. At that time, Japanese companies in Britain accounted for 65,000 jobs. Twenty-three years on, the planned state visit by Japan’s new Emperor and Empress has regrettably had to be postponed as a result of the Covid-19 pandemic. But the number of jobs provided in the UK by Japanese companies has more than doubled, to around 150,000. Since then, trade and investment have grown impressively and the cumulative stock of foreign direct investment from Japan now stands at £128.9 billion.
Cultural and educational exchanges between the two countries have also continued to develop impressively. In 1998, defence co-operation between Japan and Britain amounted to not much more than the provision of courtesy vehicles by Honda and Mitsubishi Motors at the Royal International Air Tattoo. Now, Japan is an increasingly important partner in both defence operations and procurement, all three armed services having conducted exercises with their Japanese counterparts in the last three years. Our Japanese friends had been disturbed by the emphasis placed on the UK’s developing relationship with China and are now relieved that Ministers have stopped talking about the “golden era” of our relationship with that country.
Japan’s soft power on the diplomatic stage has increased dramatically since 1997, particularly during the period in office of Mr Shinzō Abe, who has recently had to stand down for health reasons. My right honourable friend the Secretary of State for International Trade and her team deserve to be congratulated on the CEPA, but it has also been possible to execute it in such a short timescale as a result of the very positive approach towards Anglo-Japanese co-operation held by the previous Prime Minister, Mr Shinzō Abe and his Government, including his chief Cabinet Secretary, Mr Yoshihide Suga who, of course, has now succeeded Mr Abe as Prime Minister. This augurs well for the continued positive developments in bilateral relations. Given more time, perhaps the agreement might have included an investment protection chapter. Will the Minister tell us whether that could be added later? Does he also agree that the digital and data provisions illustrate well the benefits of being able to diverge from cumbersome EU regulations in that field?
Baroness Bennett of Manor Castle (GP) [V]
My Lords, coming this far down a long and distinguished speakers’ list, including the welcome expertise of the noble Lord, Lord Darroch of Kew, whom we already know has a very sharp eye for political realities and the ability to communicate them clearly, I seek to meet my regular aim of adding to the debate, rather than repeating points already made. However, I note how many speakers have highlighted how this continuity-plus agreement has been radically oversold by the Government as ground-breaking.
That the Government have a problem with trust is a statement of the obvious. They seem to fail to understand that assertion is not fact. The disrespect for reality-based politics dates back to at least the second Bush Administration in the US and seems to have spread its tentacles across the Atlantic with great success. Our Government would do well to recover a respect for reality when commenting on future trade agreements, not just for their own future, but for the level of trust and engagement in politics. The noble Lord, Lord Woolley, has just powerfully commented on that in the Chamber. It is something that the UK has a particular problem with.
As a former resident of Bangkok, where I counted as friends a number of members of the large Japanese community, I found the extended focus on blue cheese exports particularly grating—not to coin a pun. Of course, we can understand the attraction of strange and exotic foods, but 100,000 tonnes a year in sales is not, I venture to say, something we are likely to see growing significantly in this particular market.
There are many things missing here. A crucial area, highlighted by the consumer organisation Which?, is the digital. This potentially undermines the general data protection regulation, and threatens the data adequacy agreement with the EU, as many noble lords have already addressed. There are also grave concerns in the area of animal welfare. As the RSPCA has noted, there is no new language, only poor existing language that does not even recognise animals as sentient beings, something that my noble friend Lady Jones of Moulsecoomb has often addressed in the House. There is no provision to implement the Government’s commitment not to lower animal standards in free trade agreements. We come back to trust again. This part of the agreement says:
“The Parties will cooperate for their mutual benefit on matters of animal welfare with a focus on farmed animals with a view to improving the mutual understanding of their respective laws and regulations.”
I can only concur with Compassion in World Farming in saying that this wording is meaningless.
I want to focus an issue that I have been engaging with this week through the All-Party Parliamentary Group on Antibiotics. In 2017, the UK used 281 tonnes of antibiotics in animal agriculture and Japan 809 tonnes. Those figures come from the excellent Antibiotic Footprint website. It struck me in preparing for today that perhaps we could bring our technological leadership a step further, compared to the other place, by bringing slides into our speeches, for the image of the size of each nation’s footprint is a compelling and telling one—although, of course, the United States looms enormously, as it would in a similar graphic for greenhouse gas emissions and so many other environmental destructions, something to keep in mind when a trade deal there is potentially on the table.
Japan is working on reducing antibiotic use, but is clearly well behind us, something to think about at the end of World Antimicrobial Awareness Week. That is closely related to the issue of animal welfare, which is a crucial issue in its own right but also crucial for human health, as the issue of mink and Covid-19 has recently illustrated only too clearly. The risks of factory farming anywhere in the world are obvious, and trade should be one of the mechanisms we are using to tackle that.
To pick up a point made by the noble Lord, Lord Oates, about the truly world-leading work by Costa Rica, Fiji, Iceland, Norway and Switzerland with New Zealand on the Agreement on Climate Change, Trade and Sustainability, and to quote their agreement,
“trade policies, practices and rules have an important and substantive role to play”
in tackling the climate emergency, and indeed broader issues of sustainability.
Your Lordships have heard me ask before a question too often ignored. What is the economy for, and what is trade for, as a subset of that question? Growing GDP is the assessment most commonly used, yet we know that GDP is a terrible measure of national progress. Chasing it has given us a trashed planet, an insecure society and a dreadful state of public health. This agreement does not live up to the Government’s promises of improvement and does not meet the crises facing us, so it can only be called a failure, and a failure to live up to the promise. New Zealand and its allies are leading; we are again trailing far behind.
Baroness Henig (Lab)
My Lords, I congratulate the noble Lord, Lord Darroch, on his excellent speech. Clearly, he will be a great asset in future debates in your Lordships’ House, and I look forward to hearing from him.
This is an important deal for the United Kingdom, but it also raises significant issues relating to scrutiny, as my noble and learned friend Lord Goldsmith and the noble Baroness, Lady Hooper, have said. Effective scrutiny requires access to clear and relevant information. I turned first to the Government’s impact assessment and read it with increasing frustration and bewilderment. I found it turgid, difficult to follow and very unhelpful. It clearly was not aimed at a Back-Bench Member of the Lords such as me, seeking to understand the key aspects of this deal. Who was the impact assessment aimed at and why was it written in the way it was?
I felt better when I read the verdict from the International Agreements Sub-Committee on the assessment, that it
“fails to provide the information that Parliament and the public need if they are to evaluate”
the benefits of the agreement, and that it left many questions unanswered. The committee further cautioned the Government not to oversell their achievements, and I would endorse that, having followed the infamous Twitter debate about duty on soy sauce, which caused huge interest on the internet. It illustrated very clearly the dangers for the Government of inviting ridicule over their inflated claims. I note that the Minister agreed that her original tweet was an error, and she put it down to a display of exuberance. We really need to be able to access sober and realistic financial and economic analysis from the Government on trade deals.
In contrast, the report of the International Agreements Sub-Committee was excellent: clear, informative and helpful in its assessments. However, there is still one issue where I am unclear about what impact the agreement may have—along, I think, with many other noble Lords —in relation to the new provisions on international data flows. Like the noble Baroness, Lady Bennett, I have seen it suggested that these provisions will endanger a deal on data adequacy with the EU, which many businesses say will be crucial to them. Can the Minister clarify the Government’s position on that issue?
I note that other provisions hinge on a deal with the EU for their effectiveness, especially in Northern Ireland. Has the Minister any updates for us on the EU negotiations, given how close we are to the wire on that one?
I was extremely concerned to hear about the time pressures that the International Agreements Sub-Committee felt that it was under in scrutinising this treaty and hearing from a sufficiently broad range of experts. Clearly, more time is going to be needed in this area. I have in the past suggested that trade deals should be accompanied by an independent expert assessment of the main issues covered in a deal. Is that something that might assist the committee in its future treaty scrutiny? I think that those of us who are not members of that committee would find an independent report and the committee’s assessment of it, alongside the Government’s impact assessment, very helpful.
I also query whether a three-hour debate such as we are having now is sufficient time for Back-Bench scrutiny, especially in future, when the treaty is not mainly rolled over but may be a completely new agreement.
Finally, I mention involvement of NGOs and trade bodies. We have had useful feedback from some of those bodies that were consulted, such as the City of London Corporation, the Blavatnik School of Government at Oxford and Which? I very much agree with Which? about the importance of safeguarding consumer rights and protections in future deals. I also agree with the noble Baroness, Lady Fairhead, who stressed recently in Committee on the Trade Bill the importance of engagement with wider audiences. I know that some trade bodies are regularly in contact with the Department for International Trade, but many are not on official lists, and it will be vital in future to mobilise as wide a range as possible of businesses and commerce effectively behind future trade deals. I agree very much with the noble Baroness, Lady Hooper, on that one.
I have a suggestion for the Minister. The treaty with Japan has as one of its objectives to pave the way for the United Kingdom to join the CPTPP. That will raise issues far more fundamental and complicated for businesses and consumers than anything in this largely rolled-over treaty. The text of the CPTPP is already in the public domain, so there is nothing to stop the Government openly engaging and consulting on it and inviting a wide range of businesses, NGOs and trade bodies to participate in preliminary discussions. That would be a clear demonstration that the Government are serious in their desire to consult widely and engage fully in their future trade negotiations, not just with Parliament but with the wider business community and consumers.
Baroness Bottomley of Nettlestone (Con)
My Lords, I am delighted to speak in this debate, and congratulate all those involved. Fortunately, I am in the minority as someone who was not a member of the International Agreements Sub-Committee, so your Lordships will be spared my insights on that matter—but I have certainly enjoyed the comments from members of the committee, and will quite soon regard myself as an expert as well, I am sure.
I am delighted to have been present for the maiden speech of the noble Lord, Lord Darroch. I have always thought of him as a man of erudition, insight and wisdom. As someone who has served in Brussels, Washington and Japan as well as Whitehall, he evidently has a huge amount to offer us in our deliberations. My only disagreement is that I heard him say that he had always been treated with “matchless courtesy” and “forensic accuracy” when he appeared before committees. Any colleagues who have previously been in another place would not necessarily describe finding those things in a parliamentary Select Committee—but long may it last, and it may be a sign of things to come.
This trade agreement is a tremendous achievement that enables Britain to reassert our long-standing commitment to open, rules-based free trade as we leave the EU, stepping back on to the international stage as an independent, competitive trading nation with a global perspective.
I need to declare my interests: first, I am on an advisory council for a Japanese research-based pharmaceutical business and, secondly, I am a long-term director of the International Chamber of Commerce UK, an organisation which is unequivocally committed to free trade and has worked relentlessly over the years and in many ways to assist in this critical area of policy development, which is all too easily jeopardised in today’s world.
Japan is one of the largest, most open economies in the world, with 4% of world’s GDP. It remains our fourth-largest non-EU export partner and 12th including EU countries. Great credit should be given to the key International Trade Ministers who have invested massive energy, commitment and tenacity in this outcome. When visiting Japan recently, I was struck by how highly our Ministers are praised for their determination, energy and positivity, in particular the former Secretary of State for International Trade, the right honourable Liam Fox MP, and the present Secretary of State, the right honourable Liz Truss. A wonderful addition to the team has been my noble friend Lord Grimstone, a seasoned expert in many parts of the world and a wily, knowledgeable individual who greatly adds to our activities to secure effective, positive trade agreements.
Of course, this is only the beginning. I was influenced by the late Minister, Ernest Marples, who said, “You don’t need brains to be a Minister; the civil servants have them all”. I pay credit to the civil servants at the Department for International Trade, particularly Antonia Romeo, who from a standing start have developed a highly effective department. Thinking of the noble Lord, Lord Darroch, joining us, we are also much indebted to successive, highly-talented ambassadors, most recently Paul Madden—who my noble friend Lord Lansley referred to—Sir Tim Hitchens and Sir David Warren. When I was around, there was Sir John Whitehead, Sir John Boyd and Sir David Wright, all of whom were shrewd and wise in developing those commercial relationships and highly knowledgeable and effective.
Like others of my generation, I was influenced by the injunction of my Prime Minister at the time not overly to focus on the EU but to befriend and emulate Japan, a country where she found so many areas for common cause. Japan is the future. Over subsequent decades, as the noble Lord, Lord Kerr, said, we have seen investment, trading relationships and so forth develop. I led a delegation with Sir Richard Sykes, Prescribe UK, on the important pharmaceutical industry. We have heard about electronics, the motor industry and whisky—an ongoing saga even in my first visit in 1987 with, I believe, my noble friend Lord Howell. Anyone who heard yesterday’s debate in another place will have witnessed the degree to which Members of Parliament up and down the country, particularly those from the north-east and Wales, talked about their important trading relationships with and investments from Japan.
As with all agreements where trust is required to deliver sustainable results, soft power plays a central part. Our positive relations with Japan go much deeper than the commercial and economic. I have mentioned the tremendous work done by the British Council and VisitBritain over the decades. In 2019, the UK was ranked fifth for the most desired overseas travel destinations among people in Japan. Our cultures, though different in many ways, share a profound mutual fascination. When the V&A’s William Morris exhibition went on tour to Tokyo, more people visited it there than did in London. I remember Sir Geoffrey Cass, then chairman of the Royal Shakespeare Company, talking about the rapt, massive audiences who followed its performances there.
I hope that all my noble friends have purchased my noble friend Lord Howell’s delightful book, The Japan Affair, in which he details 35 years of the Japanese-British relationship based on his regular articles for the Japan Times. I for one strongly endorse his argument that we should recognise the strategic significance of this agreement and build it wider.
Viscount Younger of Leckie (Con)
I am sorry to interrupt the noble Baroness. It would be wise if she could conclude her remarks.
Baroness Bottomley of Nettlestone (Con)
Whether this agreement is a great leap forward or a simple step, we will learn from it and, I hope, in future develop it. I am delighted that it was with Japan that we made this first trade agreement.
Lord Morris of Aberavon (Lab) [V]
My Lords, I regret that there were technical difficulties when I was called earlier. My noble and learned friend Lord Goldsmith has introduced most persuasively the report of the committee on which I serve as presented to the House. It is one of many that will be presented in due course.
My noble and learned friend has made a major contribution in the way in which he has chaired the committee and mastered the tsunami of paperwork which has passed over our desks. I fear that my expertise in trade matters is limited and I confine myself in my membership of the committee to ensuring that the devolved Governments are properly consulted and that all treaties help support agriculture, on which I have some knowledge.
The proceedings of the committee brought back happy memories of a visit I made many years ago leading a UK mission to Japan to seek inward investment. As an aside, perhaps I may say that I was introduced to the president of the Japanese rugby union, with whom I shared a common interest. He told me that he was an ex-kamikaze pilot. When I queried the “ex”, he said that he was alive and well because he had been ordered back due to engine failure.
The United Kingdom has always been regarded by Japan as a stepping stone to the European Union, particularly for the motor, television and electronic industries. Given that so many parts required for automotive building in the UK flow backwards and forwards between many countries, I am far from sure about what the future holds for existing and further inward investment. I am not optimistic from the noises and the decisions that apparently have already been made.
One of the attractions of the UK for such investment is the quality and flexibility of labour. On my visit to the Japanese Sony plant at Bridgend when I was the Welsh Secretary, I was impressed by the prominence given by the management to the full-time official of the one union on the plant. One union in a plant was a basic requirement of the Japanese, and it worked.
I come to the issue that I wish to emphasise. In our report, we say that the Government in some respects have presented the Japanese deal in a way that is
“overselling the extent of CEPA’s achievements in going beyond JEEPA”.
The International Trade Committee of the other place has noted that the difference between CEPA and JEEPA
“may not be as extensive as claimed”.
I want to ensure that this agreement has not been oversold. That would be a terrible tragedy. Both committees share a common reservation about the Government’s impact assessment and its failure to provide information to enable us to evaluate how well they have done. If proper examinations by both Houses are to be the blueprint for future agreements, I hope that the Minister will note specifically our concern and that of the other place about this matter. It is essential in all these matters that the Department for International Trade provide the assessment of the value of the benefits that CEPA presents above and beyond those conferred by JEEPA as an example for future examination of treaties. That must be a requirement and a blueprint for the future.
Lord Liddle (Lab) [V]
My Lords, I, too, welcome the noble Lord, Lord Darroch, to the House of Lords. In my seven and a half years in Downing Street, I worked closely with him and, for me, he is in a long line of very distinguished diplomats who tried to make the best of Britain’s relationship with Europe. I was very interested to hear his comments about his early posting in Japan. The Japanese economic relationship with Britain is crucial, and I remember how, in the 1980s, a decade of industrial gloom, inward investment from Japan was a symbol of hope, particularly in the north-east, south Wales and other depressed areas. The noble Lord, Lord Kerr, is right to remind us that a lot of what lay behind that was our membership of the single market, which was then being born and being deepened. If there is a lesson of that history, it surely must be that the future success of our relationships in the Pacific, which will be very important—the doorway opened up to the Pacific partnership is very important—depends on us maintaining our close relationship with the European single market, which is still our biggest market.
What of the lessons of the present agreement? If I were being cynical about it—and I think this is how a European trade official would describe it—Japan has extracted a high price for what is effectively a continuity agreement. Eighty-three per cent of the increased trade is estimated to be on the Japanese side. That 83/17 balance is a pretty good result for the Japanese. This was a predictable result: we were the demandeur. There is a political need on the Government’s part, which I think they must be very wary of, to demonstrate that deals can be done and to claim that any deal is a great success. There is also the timing. It took forever to negotiate the EU-Japan deal—I think it started off when my noble friend Lord Mandelson was Trade Commissioner. This deal we achieved in four months, so it was never going to be a great advantage to us.
In future, we must be more strategic and less naive about trade. To again use a Brussels expression, we need to be much clearer about where our offensive interests lie in trade negotiations. What are we trying to achieve? Where are we going on digital issues? Where are we going on geographical indications? What is our aim in terms of attracting inward investment? We must have a clear strategic view of these questions rather than just ad hoc negotiation. The Government have not given enough attention to thinking about these issues strategically.
The other point, which is that of the committee’s report on the deal that we are discussing today, is that the quality of our debate about our future trade strategy depends on transparency from the Government—not secrecy, which is what we have had—about how the negotiations have gone. We need transparency and honesty. I see a crucial role for this House, because of our depth of expertise and the civilised way in which we conduct ourselves, in contributing to that public transparency, as the report from your Lordships’ committee has done. I very much hope that, in the review of our committee structures, which is ongoing today, we will continue to devote resources to such scrutiny because if we are not prepared to do it, I do not know who else will be.
Baroness McIntosh of Pickering (Con)
My Lords, I thank the noble and learned Lord, Lord Goldsmith, and his committee for securing this debate and for their excellent report, which has been most helpful in preparing today.
I also welcome most warmly the noble Lord, Lord Darroch of Kew, and congratulate him on his maiden speech. I take this opportunity to thank him for all the help he provided me in my capacity as MEP when he was at the UK representation and its help in briefing MEPs for debates in the European Parliament.
The noble Lord, Lord Liddle, and others have spoken of the asymmetry and imbalance in the rollover agreements that have been secured to date. I think it was the noble Lord, Lord Purvis, who secured our debate in the previous Parliament on our agreement with the Faroe Islands, to which we export £90 million—mostly fish—but from which we import £200 million, mostly fish. The noble Lord, Lord Liddle, set out the asymmetry in the agreement before us today.
I welcome the Minister and am delighted to see him in his place today. I take this opportunity to pick up on some his remarks in the form of questions that I hope he will be able to answer. What stood out in the agreement, but which I do not think anyone has mentioned today, are the state aid rules and the rules on subsidies, which are much stricter and reflect the state aid rules we currently have as a member of the single market since the new arrangements came into place. In much the same way as my friend, the noble Baroness, Lady Henig, asked about the deal currently being negotiated, surely my noble friend and his department would wish to move by maintaining the current state aid rules that we have with the European Union if that were to mean that we could close in on a deal on our future relationship with a proper free trade agreement there.
The noble Lord, Lord Trees, asked who will uphold our animal health and environmental protection standards in any future trade deal. I hope my noble friend Lord Grimstone will reply that it will indeed be the Trade and Agriculture Commission. That begs the question that several noble Lords have posed in the debate today about the scrutiny that will be permitted of future trade deals. I hope my noble friend will have a chance to consider the amendment that several of us—I like to think the four wise ladies—have tabled to the Trade Bill to allow sufficient time to scrutinise not just free trade agreements but the recommendations of future Trade and Agriculture Commission reports to enable us to view the criteria it has set and its recommendations on to what extent such agreements reflect and follow those criteria. I congratulate my noble friend and his department on moving to ensure that the commission will have a degree of permanence, which I hope will be further extended before the initial three-year term expires.
I also pay tribute to my right honourable friend Elizabeth Truss, the Secretary of State for Trade. She appointed the first ever agriculture attaché to Beijing, which at the time and since has brought enormous benefits, particularly in the agri-foods sector, which I care about passionately, and more especially in pork. It has enabled all the pork parts that we do not savour in this country to be exported to China and other countries. I hope that, as my noble friend Lord Lansley said, that will be a forerunner and that we will see many more such examples. Learning from a small country like Denmark, it never ceases to amaze me that its exports of agricultural foods often outstrip our own.
I welcome this rollover agreement, although I regret that it is perhaps imbalanced in favour of Japan. However, I hope that it will be the forerunner to others. I hope also that before the 31 December deadline is reached, this House will have had a chance to approve a trade deal on our future relations with the European Union.
Lord Purvis of Tweed (LD)
My Lords, as is the case in many of these trade debates, it is a continuing pleasure to follow the noble Baroness, Lady McIntosh, and I agree with much of what she said. I am sorry to see the Minister’s discomfort with his eye and I admire his resilience during this debate. I wish him a speedy recovery. I also commend the able way in which the noble and learned Lord, Lord Goldsmith, introduced the committee’s report. I commend all the members of the committee who have contributed to the debate today, including my noble friends Lord Oates and Lord Foster. I also agree with the noble Baroness, Lady Henig, that not only is this a thorough report, it is a very readable one. On many aspects, for those of us who are not steeped in the language of negotiation, readable reports on the consequences of trade agreements are of the utmost importance. I also welcome the maiden speech of the noble Lord, Lord Darroch. I serve on the international relations Select Committee. When we visited Washington, he hosted us for a great visit to the embassy and gave us valuable insights into American politics then under the Trump Administration. To our great benefit, everything that he says now will be on the record, and we will value his ongoing contributions.
In Committee on the Trade Bill, I think that the Minister felt that sometimes I was being rather churlish and a bit dour in some of my remarks. He challenged me to welcome signed trade agreements, and I do so; I welcome this agreement. However, not to disappoint him, I regret that we will be starting next year with fewer free trade agreements than we had prior to leaving the EU. I regret that businesses are facing more costs, more complicated red tape, more bureaucratic government processes and export procedures that are still confusing. I did reflect that page 9 of the scoping document for the UK-Japan agreement states:
“We will ensure that processes are predictable at, and away from, the border.”
Unfortunately, at the beginning of 2021, we will have anything but that.
This is a rollover agreement with some elements of addition which have been debated. I have said on a number of occasions during the passage of the Trade Bill and before it that my party has as one of its founding principles free, fair and open trade. We have been a champion of that for over a century. But we also believe in proper parliamentary scrutiny and accountability. For us to judge the benefits of agreements such as this, the scrutiny as set out in the report of the committee is both welcome and necessary. We will require ever deeper analysis to be able to come to a balanced view of the relative benefits to the UK, as the noble Lord, Lord Liddle, and others have indicated, compared with our trading competitors.
However friendly our trading competitors are, they are still competitors to the UK economy. It is my view that the scrutiny processes need to be enhanced, and we will debate that on the Trade Bill over the coming weeks. The reality for trade agreements, which I have learned during my time in this House, is that a Government who need the agreement the most will concede the most. Fundamentally, therefore, we have two questions today: is this deal good for Britain and is it a negotiated deal that provides comparative advantage for the UK as compared with Japan? We have had a lot of references to the Government selling this, but I think that we often operate a John Lewis trade policy—never knowingly undersold. There has certainly been no shortage of hyperbole. The Daily Express, in response to the announcement by Liz Truss of the signature for this deal, shouted
“Brexit Britain makes history as staggering £15 billion Japan trade deal secured.”
If grandiosity was an exportable commodity, our economic woes would be over, and I think that most Daily Express readers would be staggered to learn that, of that £15 billion, only £2.6 billion is to the benefit of the UK and the remainder is to the benefit of Japan. Therefore, parliamentary oversight and the ability for us to approve the mandates and then the agreements signed is vital. It should not be lost on Members of the Grand Committee that while we do not have a say on the setting of the mandate, and nor do we have a say on the final deal, the Japanese Diet will be voting for ratification on an up and down vote.
It is fair to compare the objectives set by the Government with what has then been realised. The Government published their strategic approach document in May 2020, which said that we would see a growth in exports of 21.3% over 15 years, but the final impact assessment states that we will see an increase of 17.2%, falling short of their ambition by nearly 25%, as the committee has alerted us. Can the Minister explain why we have fallen so short?
I want to look a little more closely at the comparative benefit, notwithstanding the remarks of the noble Lord, Lord Lansley, who knows that I hold him in high regard on these issues. The Government’s impact assessment for the UK on the EU-Japan agreement was published in May 2018. It stated that
“The economic assessment is carried out against a baseline”
where the EU-Japan EPA has not been implemented. This was the same for the scoping assessment for the UK-Japan agreement published in May 2020 and the same for the impact assessment published by the Government in October, so the same baseline makes for interesting reading. The Government’s impact assessment for the UK component of the EU-Japan agreement said:
“Compared to a baseline in which the EPA is not in force, we estimate that the beneficial impact of the EPA on UK GDP could range from between £2.1 billion to £3.0 billion per annum in the long run.”
The impact assessment of this agreement suggests that it is just £1.5 billion. The impact assessment for the EU went on to say:
“We estimate that because of the EPA, UK bilateral exports to Japan could increase in the range of £3.3 billion to £5.6 billion.”
The reality set out in the assessment in October this year is £2.6 billion. So even in the estimates of the UK impact on the EU agreement, we fall short. Let us remember that this uses the same baseline as if there had been no agreement in the first place.
Let us look at the sectors. My noble friend Lord Shipley referred to the motor industry in the north, which is absolutely vital to the area. The impact assessment of the EU agreement for the UK would see an increase for the motor vehicle industry of £1 billion, while the impact assessment for this shows no change. The UK is not at any comparative benefit from where we were with the European agreement. I accept that it can sometimes be difficult to compare baseline data when looking at the different circumstances—that is fair—but we are looking at comparisons between 2018, 2019 and 2020 from the same Government. Therefore, if there are differences, the Minister should say in his response that it is difficult to draw direct parallels, and it is incumbent on the Government to give us tracking data showing why the baseline indications are different.
I have a great deal of sympathy with the contribution made by the noble Lord, Lord Lilley. Having sparred quite consistently with him during the trade negotiations on this, I hope that it will not offend him or make him feel uncomfortable if I say that I agree with every single thing he said in his speech today. I am not sure if that helps at all with our relationship, but I do. To try to get a balanced view, I did something I have not done before, which was to read the report of the Regulatory Policy Committee, the existence of which I admit I was not thoroughly au fait with before. It has reviewed the impact assessment well. Page 5 of the report indicates something quite interesting when looking at the baseline data:
“The uncertainty around the use of the ‘do nothing’ baseline should be made clearer in the IA and set in context with the existing EU-Japan FTA.”
I agree. In judging the long-term versus the short-term benefits, in a wonderful understatement it also states on page 5 that:
“There is a noticeable tendency towards highlighting and exploring the beneficial sides of CEPA.”
It goes on to say:
“The motor industry will see a contraction as a result of this.”
The Regulatory Policy Committee goes on to talk about there being no information about the comparative people movement, as the noble Lord, Lord Lansley, indicated. I shall conclude on the element of the UK-Japan balance of trade. On the key element of what our strategic comparison of benefit would be and the impact on our balance of trade, page 43 states that UK exports would increase by 17.2%, as we have heard, but that:
“The paragraph focuses on the increase in the overall trade between the UK and Japan, but does not discuss the UK’s balance of trade, which according to these figures would weaken by £10.4 billion.”
If we are to judge the merits of a trade agreement, we have to look at the comparative benefits for each of the two signatories. We have to compare accurately what the Government said it would be, and the reality. On the overselling of the agreement, I agree with noble Lords: it will put at risk the reputation of all trade agreements going forward if the Government actively oversell the agreement. We are in debt to the committee for bringing many of these points to our attention and I hope the Minister will respond positively to many of the contributions made in this debate. If he can do anything, perhaps he can persuade the Secretary of State to sell a little less and to deliver a little more.
Lord Stevenson of Balmacara (Lab) [V]
My Lords, I thank all speakers for their contributions today. I welcome the noble Lord, Lord Darroch of Kew and congratulate him on his maiden speech. His reflections on the trade agreement before us after such a short time in your Lordships’ House illustrate that he will fit in very well, and we all look forward to his further contributions. I also welcome back my noble friend Lady Liddell and thank her for her contribution today. I extend my sympathy to the Minister on his recent eyesight problems and wish him a speedy recovery.
I welcome the report from the International Agreements Sub-Committee and thank my noble and learned friend Lord Goldsmith for his excellent introduction. From the comments of members of the committee who have spoken today, it is obviously a committee which is already working well in what is a new activity, which is probably just as well, as it seems to have quite a lot on its plate. This first substantive report from the IAC is, as its chairman pointed out, about the CEPA signed earlier this year between the UK and Japan, but it is also witness to the scrutiny process for trade treaties that the Government are bringing in. In that sense, it is an historic first for this House and for Parliament. We have had useful and insightful comments on both issues and, as was the case in the Commons when it debated the report of its Select Committee on International Trade yesterday.
Several speakers have mentioned that, notwithstanding changes relating to agriculture and data, and the inclusion of dedicated chapters on women’s economic empowerment and SMEs, CEPA almost entirely replicates the EU-Japan free trade agreement. I agree with the noble Viscount, Lord Trenchard—a rare occurrence—that there is a lot to commend the fact that a roll-over continuity deal is a good thing to have at this time of uncertainty, but the Government would do well to learn from the criticisms made today and elsewhere about their apparent overclaiming of benefits, unwillingness to provide accurate baseline figures and testable estimates of benefits. There is a sensitivity about gaps in the treaty, such as pointed out today, about the lack of an inward investment chapter and better and more targeted support for our creative industries.
I will not go through every issue raised by speakers today, but I would like to mention a few. First, it is obvious that there is an imbalance in the treaty. It is tilted very much in Japan’s favour with the final estimate, if we can believe the figures, revealing that about 83% of the projected increase in trade will go to Japanese exporters. Obviously, no Government should design a trade policy around the minimisation of trade deficits, given that that would lead to a protectionist rejection of imports. Nevertheless, these figures demonstrate that there much greater benefits in the deal for Japanese exporters. However, according to the impact assessment, increased imports from Japan will boost employment in certain industries. But the Government also estimate that there will be negative effects for employment in sectors where Japanese imports will provide cheaper alternatives to home-grown products. As the noble Lord, Lord Kerr, said, it is a bit ingenuous of the Government not to make it clear how much CEPA depends on a satisfactory deal with the EU on cumulation, rules of origin and zero tariffs. I hope the Minister will respond to this when he comes to reply.
Secondly, we need to do better on tariffs, and particularly on TRQs. The EU has 25 separate TRQs with Japan on agricultural goods, of which the UK has managed to secure partial access to 10. Of those 10, the UK gets only leftovers of what the EU has not taken up that year. When you learn that, in practice, Japanese importers have to secure a bank guarantee to import UK goods at the reduced tariff, with a higher tariff charged retrospectively by the Japanese authorities at the end of the year if the EU has taken up its full quota, that means that this bureaucracy and uncertainty will inevitably reduce what Japanese importers will opt for in terms of UK agriculture, which is surely a great pity. The Government have argued that UK exports will not lose out because, by the time the EU increases its use of the TRQs, we will have already joined the CPTPP, therefore securing zero tariffs. However, as others have said, that is hardly a proper response to the issue. Perhaps the Minister will comment when he comes to respond.
On labour issues, trade unions were not able to provide input on any text during the negotiations and drafting of the UK-Japan EPA. This is the latest of a long list of times when the DIT has brushed aside union concerns and rejected opportunities to consult them. Why is this? In many cases, the lack of trade union consultation shows. The labour provisions of the deal have not advanced on those agreed in the EU-Japan EPA, and they are weak and unenforceable. Alongside the missed opportunities to strengthen labour provisions, the UK-Japan CEPA rolls back civil society dialogue. The UK and Japan have to meet with civil society groups only two years after the deal comes into effect, rather than the one-year wait that was contained in the earlier agreement. Will the Minister comment on that?
On digital matters, raised by several noble Lords, including the noble Lord, Lord Oates, the Government say that CEPA will enable a free flow of data while maintaining high standards of protection for personal data. However, many of these elements of the UK-Japan deal are not new. Some are but, by not requiring each other’s companies to follow data localisation, disclose algorithms or hand over encryption keys used to guard proprietary tech and data, CEPA has removed some of the provisions insisted on by the EU to give it control over the activities of Japanese tech companies. Is this a good thing? As well as bringing benefits for UK firms operating in Japan, as it largely will do, these provisions will reduce burdens on and increase proprietary protections for Japanese digital firms wanting to expand business in the UK. However, is this light-touch approach really the way forward? I would be grateful if the Minister could respond when he comes to reply on whether this light-touch regulatory system does not run counter to the Government’s concerns over data protection or, indeed, the imposition of stricter controls on companies over the access to online content. What about the online harms Bill? Does the Minister believe that the positions taken on data localisation can be squared with getting agreement with the EU on the data equivalence issues, and will the position on net neutrality not cause difficulties with the US and Australia, where powerful media interests have been engaged in long-standing campaigns against the principle?
Finally, as others have said, this is a report on the new system of scrutiny, which the Government—sometimes somewhat reluctantly—are ushering in. The Japan deal is being ratified under the procedures laid down in the Constitutional Reform and Governance Act 2010, which dictates that all international treaties must be laid in Parliament for 21 sitting days before they become law. There is no obligation under CRaG for the Government to hold today’s debate but they are doing so, in part to nullify criticism from us, from the committee, the International Trade Select Committee, their own Back-Benchers and the House of Lords about the inadequacy of CRaG as a mechanism to allow scrutiny and approval of trade agreements.
We ought to do better on this. As the noble Lord, Lord Trees, and other noble Lords have said, today’s debate focuses on the signed treaty but ignores the other important steps in this process: the approval of objectives, the receipt of progress reports and the ratification procedure itself. We can do better, and I do not believe that we are far apart. The Government seem adamant that we should continue to operate under the royal prerogatives and leave the CRaG processes alone. I happen to disagree. In the interests of making progress, I suggest to the Minister that we use the time before Report to find a way forward which builds on the progress so far evident today and the experiences that we gain in the next few years, to sort out a proper process worthy of the importance of trade to our country.
The Minister of State, Department for Business, Energy and Industrial Strategy and Department for International Trade (Lord Grimstone of Boscobel) (Con)
My Lords, this has been an extensive and compelling debate. The many thoughtful and measured contributions that we have heard this afternoon have reiterated this House’s ability to express its expertise clearly and authoritatively on the most important issues of the day. The 11 years spent by my noble friend Lord Trenchard in Japan perhaps deserves today’s gold star for knowledge.
On a personal level, I very much thank the noble Lords, Lord Purvis and Lord Stevenson, for their kind remarks about the underlying cause of my rather piratical appearance before noble Lords today.
The UK-Japan comprehensive economic partnership is a very important agreement, not least because it is the first in nearly 50 years that the United Kingdom has struck on its own account with another major economy. It strengthens Britain’s relationship with the third-largest economy in the world. It not only secures the benefits of the existing EU agreement—I ask noble Lords to remember that that was something that many said was impossible—but it goes further in a number of key areas, such as digital and data, the protection of geographical indications, and rules of origin.
At this point, perhaps I may welcome the noble Lord, Lord Darroch of Kew, to his place this afternoon and thank him on behalf of all of us present for electing to make this debate the occasion for his maiden speech. It was a particularly appropriate choice, given his deep experience of Japan. It is clear from his insightful remarks today, combined with his outstanding record of public service, that he will make a significant contribution to the quality of our proceedings.
I also take the opportunity to thank the staff and members of the EU International Agreements Sub-Committee, so capably chaired by the noble and learned Lord, Lord Goldsmith, for the timely production of their report on the UK-Japan CEPA. I fully recognise the enormous amount of effort and labour that it involved, and I am extremely grateful for their work. As the noble and learned Lord, Lord Goldsmith, said, at least we have ended up producing a respectable agreement. I also thank the many members of the committee for their very informed contributions today. I should also thank my noble friend Lady Bottomley for her kind remarks about my officials.
We will talk about scrutiny later, and we will certainly discuss it further at the Report stage of the Trade Bill, but, having examined the sub-committee’s findings and from listening to the many contributions from noble Lords today, it is clear that this thorough and considered report has enhanced the House’s understanding of the key issues in this agreement. To my mind, that is what scrutiny is all about. With those key issues in mind, I would like to address specifically as many of the points raised by noble Lords as I can in the time available.
I will talk, first, about agricultural market access. I believe that we have negotiated a deal that will secure the continuation of strong tariff reductions across a range of agricultural exports—most notably, higher-value pork, beef and salmon. Noble Lords will note that I used the word “continuation”. We will continue to benefit from access to the low tariffs for key food and drink products covered by quotas, such as Stilton cheese, tea extracts and bread mixes.
It is perhaps worth noting that in 2019-20 total UK agri-food exports to Japan were worth around £402 million, of which £271 million related to beverages, spirits and vinegar, and £131 million to other agri-food products. I know that noble Lords have been concerned about tariff-rate quotas, but I remind them that only around £1 million of those exports was covered by TRQs. The deal that we have negotiated has, I think, provided a pragmatic solution, focusing on those quotas with the highest usage and of most value to the UK. The new arrangements cover 99% of the value of UK exports under EU TRQs in 2019-20.
We expect there will continue to be enough surplus volume in the EU TRQs until around 2024, by which time we hope and expect to have joined Trans-Pacific Partnership. The CEPA arrangements therefore—and I may come back to this later—form a pathway to further market access under CPTPP. That has, of course, been committed to by Japan as part of our agreement. The UK and Japan will monitor the implementation of the scheme for all products. Japan has provided a ministerial side letter committing to work closely with the UK to ensure the effective operation of the new scheme, such that the UK receives unfettered access to any under-utilised EU quota for the 10 TRQs covered by the scheme. I can assure the noble Baroness, Lady Bowles of Berkhamsted, that we will work hard to make sure that this process is as streamlined as possible. I will write to the noble Lord, Lord Loomba, if I may, on the points he raised about the TRQs.
Some noble Lords today have raised queries relating to geographical indications. Seven UK GIs are already covered in the agreement. The agreement sets out an improved process for the addition of new GIs. Under CEPA, it has been agreed that all eligible British products will be put through Japan’s GI approval process automatically. This arrangement is significantly better than the terms of the EU-Japan EPA, under which the EU was not able to put forward any new products for protection without explicit Japanese agreement. We have achieved agreement with the Japanese on this.
A number of noble Lords have raised queries concerning digital and data. The UK is committed to maintaining high standards of protection for personal data, including when it is transferred across borders. I can confirm to the noble and learned Lord, Lord Goldsmith, and the noble Lord, Lord Foster, that the rights of UK users are not impacted by the deal with Japan and data protection standards will not be lowered as a result of the deal. UK data rules, which will continue to be enshrined in the Data Protection Act 2018 and the GDPR, will continue to apply. Moreover, CEPA does not interfere with the high level of protection afforded to personal data which is transferred out of the UK under the UK’s data protections laws. CEPA goes further than the existing EU-Japan agreement on many aspects of digital trade with a number of cutting-edge rules that reflect the status of the UK and Japan as digital leaders. This includes—and a number of noble Lords have referred to these points—a ban on unjustified data localisation. This prevents potential costs for companies that result from requirements to store data within national borders. It also includes an agreement to avoid unjustified restrictions on the free flow of data between the UK and Japan. This ensures that data will be able to be collected, processed and transferred between the two countries, without facing unnecessary red tape. Very importantly, we have a commitment to uphold world-leading standards of protection for individuals’ personal data when data is being transferred across borders. UK data protection laws, I say again, are not undermined or changed by the deal with Japan; any transfers of personal data to Japan must satisfy the UK’s high standards of data protection. The changes in the agreement directly benefit the UK’s digital economy, which in 2018 delivered £675 million in services exports to Japan.
The noble Lord, Lord Oates, and the noble Baroness, Lady Bowles of Berkhamsted, raised the question of algorithms. If I may, I will write to them about that.
On the matters relating to financial services, I was grateful to my noble friend Lord Lansley for emphasising the welcome that the FTA has received in the City and for the comments from my noble friend Lord Risby. I have to say that I am optimistic about the way forward in this area and the scope for further advances. This is important to us because financial services are of course our biggest export to Japan, accounting for around 25% of all UK exports to Japan in 2019. The CEPA provides improved market access for financial services firms, including greater transparency and streamlined application processes for UK firms seeking licences to operate in Japan. There will be an annual dialogue between Her Majesty’s Treasury, UK financial regulators and the Japanese FSA that will explore ways to further reduce regulatory friction.
The noble Lord, Lord Foster, raised some important points about intellectual property, and if I may, I will write to him on that. The existing EU-Japan agreement contained a high standards IP chapter, but the CEPA contains a number of improvements to the EPA, covering designs, trademarks, copyrights and enforcements. I believe these improvements will bring benefit to both creative industries—for example, the music industry—and IP-intensive businesses.
A number of noble Lords raised issues relating to SMEs. The noble Baroness, Lady Liddell of Coatdyke, referred to the importance of this, and I can assure her that we consult widely with organisations that represent SMEs when we negotiate and carry forward agreements such as this. The CEPA will support SMEs through a dedicated SME chapter, which will ensure that SMEs are provided with the tools and resources necessary to seize the opportunities of exporting to Japan. This will include a commitment to making sure that information on doing business in Japan is available to UK SMEs in English.
I know that there is, rightly and properly, a strong interest across our House in the automotive industry, which was referred to in particular by the noble Lord, Lord Kerr of Kinlochard. The CEPA will continue to support jobs in the manufacturing sector—major investors such as Nissan and Hitachi, as well as our own manufacturers—through reduced tariffs on parts which already come from Japan, streamlined regulatory procedures and greater legal certainty for their operations. UK tariffs on two tariff lines covering electrical control units, often used in cars, will be put to zero as of 1 January 2021. By bringing in reductions on tariffs on car parts, UK-based auto manufacturers will benefit from lower costs of productions, which they could pass on to consumers.
As I mentioned earlier, on rules of origin, we have included a provision that seeks to recognise Japanese inputs that are contained in UK goods that are exported to the EU, and of course this is particularly important for the auto sector. While we have included this provision in CEPA, as the noble Lord, Lord Loomba, noted, this arrangement would also need to be agreed between the UK and the EU in order for it to come into effect. Of course, as a number of noble Lords have referenced, that most important negotiation is still ongoing. However, I ask the noble and learned Lord, Lord Goldsmith, and perhaps others, not yet to prejudge the outcome of those negotiations.
On the important question of food safety and animal welfare, I can reassure the noble Lord, Lord Trees, that we have locked in the benefits of the EU agreement on SPS and animal welfare, and nothing in the CEPA prevents the UK from continuing to uphold its high environmental, food safety and animal welfare standards now that the UK has left the European Union. I will write to the noble Lord, Lord Trees, and the noble Baroness, Lady Bennett of Manor Castle, with more details of the important animal welfare points that they raised.
I was pleased that my noble friend Lady McIntosh of Pickering rightly reminded us that when we debate matters such as this, we will have the benefit of expert advice from the Trade and Agriculture Commission, which I am pleased we are putting on to a statutory footing.
I know that climate change is an issue of great importance, and I recall the noble Lord, Lord Oates, speaking formidably on this topic after my maiden speech in September, as again he did today. I assure him and the noble Baroness, Lady Bennett, that the UK-Japan agreement locks in the benefits of the EU-Japan deal, including various provisions on climate change, such as those that reaffirm our respective commitments to the United Nations Framework Convention on Climate Change and the Paris Agreement.
On labour standards, I say to the noble Lord, Lord Stevenson, that the agreement includes provisions that commit the UK and Japan to reaffirm their obligations to internationally recognised principles on labour. In addition, the UK continues to meet its obligations under the International Labour Organization. I am pleased to acknowledge that we have now set up a trade union advisory group so that, as I am sure the noble Lord would support, we will be able to draw directly on the experience of trade unionists in future negotiations.
On standards, we have made it clear that the Government will never compromise the UK’s high environmental protection, product, animal welfare and food safety standards in this or any deal. I can confirm that nothing in the CEPA prevents the UK continuing to uphold these.
A number of noble Lords referred to the Trans-Pacific Partnership. It is clear that the CEPA also has wider significance in this context. We see the CEPA as part of our ambition to put the UK at the centre of a network of free trade agreements, making us even more of a focal hub for global businesses and investors.
Accession to the Trans-Pacific Partnership continues to be a priority for the Government and a key part of our trade negotiations programme. It complements bilateral agreements we have with TPP members, including this Japanese CEPA, deals we hope to strike with Australia and New Zealand, and existing EU agreements with Canada, Chile, Mexico, Peru, Singapore and Vietnam that we hope to transition into bilateral UK deals. We hope to be able to apply for formal accession in early 2021. I note the view of the noble Baroness, Lady Henig, that there should be wide consultation on this in due course. I was glad of the wise words of the noble Lord, Lord Darroch of Kew, and of the support from my noble friend Lord Risby and the noble Lord, Lord Bilimoria, in relation to potential accession. As recognised by my noble friend Lord Trenchard, Japan’s clearly stated support for this is extremely valuable and important to us.
I want to address directly noble Lords’ concerns that there may be greater benefits for Japan than for the UK in this agreement. It is true that the analysis shows that UK exports to Japan could increase by around 17% in the long run whereas UK imports from Japan could increase by around 80%, compared to no agreement. However, I say with all respect to noble Lords, including the noble Lords, Lord Liddle and Lord Stevenson, that cheaper imports lead to lower prices in British shops and make our businesses more efficient and competitive in global markets.
I acknowledge that our economic modelling does not compare the impact of the UK-Japan agreement with the impact of UK membership of the EU-Japan agreement. Our modelling compares the impact of CEPA against a situation where we do not have an agreement with Japan: that is, trade on MFN terms.
A number of noble Lords—I happily list some of them: the noble and learned Lord, Lord Morris, the noble Lords, Lord Purvis, Lord Stevenson, Lord Darroch, Lord Oates, Lord Hain, and Lord Foster, and the noble Baronesses, Lady Liddell, Lady Henig, and Lady Bennett of Manor Castle—expressed concern, which I acknowledge, about the way in which the agreement was publicised on media platforms and the claims that were made in relation to it. With a certain degree of trepidation, I will draw these comments to the attention of my colleague, the Trade Secretary.
I say to noble Lords that the right comparison for assessment is this deal versus no deal rather than the hypothetical continuation of our membership of the European Union. Going forward, I reassure the Committee that the UK and Japan will meet each year in a joint committee and, as part of the DIT’s transparent and inclusive approach to monitoring, I confirm that we will publish a monitoring report every two years.
I hope that my closing remarks have provided a broad assessment of the deal’s clear value and scope. The scrutiny the agreement has had has been extremely valuable. I apologise to noble Lords who have not had their questions answered directly, and I will write to noble Lords as varied as my noble friend Lord Howell of Guildford, the noble Baroness, Lady Liddell, my noble friend Lord Trenchard and other noble Lords, answering questions I was unable to answer today.
In conclusion, this agreement represents an historic milestone in the UK’s future as an independent trading nation. We will come back to the question of parliamentary scrutiny in our debate on the Trade Bill shortly. I hope that we will be able to take full advantage of the clear economic opportunities presented to us by this deal, and I am confident that this agreement will set a clear path and provide strong momentum to secure high-quality future trade agreements with friends and partners from around the world. I beg to move.
Lord Goldsmith (Lab)
My Lords, I thank the Minister for those remarks and his thorough observations on what noble Lords have said, but I particularly thank noble Lords who have taken part in the debate. When we first thought we would have a debate on this agreement, I was a bit nervous, because I knew that some of the very controversial areas that concern trade—the things that fill newspapers—would not arise on this agreement: it would be some sort of continuity agreement. I was quite wrong to think that this might not be a valuable debate; it has been very valuable. I, for one, will come back to things that many noble Lords have said in this debate when we look at other agreements; they are valuable and important.
I thank noble Lords for what they said about the report. To the extent that there is credit, it goes to my colleagues on the committee, but particularly to our staff. I pay particular tribute to the staff, who worked very hard under very pressing circumstances to get this scrutiny done, led by Dr Dominique Gracia, who is leaving us today, I think. She can rest on the laurels of a successful report and a debate in the House of Lords as, perhaps, her final official act, and I thank her.
Like other noble Lords, I congratulate the noble Lord, Lord Darroch of Kew, and welcome him. I had the privilege and pleasure of working with him in government, as did many noble Lords, and knew what a tremendous contribution he would make to this House. His clarity of thought, perceptive insight and incisive judgments will be very welcome here—perhaps much more than they were by the outgoing president of another country. I therefore very much look forward to his further contributions.
Time does not permit me to go through the important themes of our debate now, but we will return to them, including the question of scrutiny. I worry that we were able to do this in the time that we had partly because of the co-operation of the noble Lord Grimstone, and his staff, and on the back of an agreement that largely replicated an existing one. How we could have done so on something completely new, with a new text, worries me enormously. We will come back to that, and not just in debates on the Trade Bill.
Meanwhile, we are feeling our way. I think the Government are feeling their way as well, but I heard the Minister say that they have found this scrutiny helpful. That is what we intend: to be helpful to the people, but also to the Government. We think that, as examples in other countries demonstrate, scrutiny can help in negotiations. On that note and with those hopes, I beg to move.
The Deputy Chairman of Committees (Baroness Watkins of Tavistock) (CB)
That completes the business before the Grand Committee this afternoon. I remind Members to sanitise their desks and chairs before leaving the room.
House of Lords
Arrangement of Business
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, the Hybrid Sitting of the House will now begin. Some Members are here in the Chamber, respecting social distancing, others are participating remotely, but all Members will be treated equally. If the capacity of the Chamber is exceeded, I will immediately adjourn the House. Oral Questions will now commence. I ask those asking supplementary questions to keep them to no longer than 30 seconds and confined to two points. I ask that Ministers confine their answers to two points as well, and be brief.
G7 Summit
(4 years, 1 month ago)
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Lord McConnell of Glenscorrodale
To ask Her Majesty’s Government what priorities they will set for the G7 Summit to be held in the United Kingdom in 2021.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, the Government are developing an ambitious agenda for the UK’s G7 presidency, focusing on our people, prosperity and planet. We will seek to build off the G7’s shared values as democratic and open societies to address the key health, economic and climate challenges of the day and build back better for all.
Lord McConnell of Glenscorrodale (Lab)
My Lords, I am certain that I speak for noble Lords on all sides of your Lordships’ House when I express my disappointment at the resignation of the noble Baroness, Lady Sugg. She has been an excellent Minister who has done an incredible power of work, particularly for women and girls around the world, and enhanced Britain’s reputation as she did so. We are disappointed that she has left the Government.
In 2005, I felt an enormous sense of pride at Gleneagles in Scotland as the UK used our leadership of the G8 summit to bring the world together, to unite the world and ensure that there were increased and accelerated commitments from G8 leaders and others to help those living in extreme poverty. Is it not shameful that in 2021, the Government will use the months ahead of the G7 summit in the UK to do the exact opposite and, like the worst kind of playground bully, after a year in which a pandemic has reminded us of the interdependence of our world, to pick on the most vulnerable and break a promise to the poor?
Lord True (Con)
My Lords, I share the noble Lord’s tribute to my good friend and noble friend Lady Sugg. The Government are committed to supporting international development and helping the world’s poorest people, as we have shown already in 2020, hosting the world’s biggest ever summit to raise funding for vaccinations in the poorest countries, and we continue to commit to supporting developing nations against the coronavirus problems.
Lord Sikka (Lab) [V]
My Lords, I draw attention to the Register of Members’ Interests, which states that I am an unpaid adviser to Tax Justice Network. We all know now that tax revenues are vital for economic recovery. A report by Tax Justice Network has estimated that, globally, more than $427 billion is lost each year due to corporate tax abuses and private tax evasion. The UK’s Crown dependencies and overseas territories are responsible for more than one-third of global tax losses. Will the Government ensure that curbing tax abuse is on the G7 agenda?
Lord True (Con)
My Lords, of course I note the points made by the noble Lord. The Prime Minister will give further details on the agenda for the G7 shortly.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
Is the noble Lord, Lord Walney, with us? I do not see him, so I call the noble Baroness, Lady Fall.
Baroness Fall (Con) [V]
My Lords, the G7 started life as a fireside chat between the most powerful people in the world, a chance to resolve some of the most critical issues of the day—at the moment they will be spoiled for choice. If we want to see global action on climate change, Covid, mass migration, combating terrorism, eradicating poverty and dealing with China’s growing influence in the world, the provision of 0.7% is a very good way to start. Will the Minister explain how the cutting of ODA at this particular time, when we are about to take over the leadership of the G7, will prepare for those huge challenges?
Lord True (Con)
My Lords, the Chancellor set out very clearly yesterday that our intention is to return to 0.7% when the fiscal situation allows. According to the latest OECD data, the UK will remain the second-highest aid donor in the G7.
Baroness Smith of Newnham (LD)
My Lords, in his initial Answer the Minister talked about “our people”. Can he reassure the House and, indeed, any current recipient of overseas development aid, that “our people” means everyone, and that the United Kingdom, with the presidency of the G7, will be outward looking and supportive, not introspective, inward looking and narrow minded?
Viscount Trenchard (Con)
My Lords, today it is increasingly the Indo-Pacific that holds the keys to global stability and prosperity. An international commission established by Policy Exchange has put forward the idea of an Indo-Pacific charter, modelled on the Atlantic Charter. Does the Minister agree that Britain should seek G7 backing for an Indo-Pacific charter, as already endorsed by Stephen Harper, Shinzō Abe and Scott Morrison? Does he also agree that our playing a leading role in that would fit well with our intended accession to CPTPP, signalling our repositioning as “global Britain”?
Lord True (Con)
Again, my noble friend touches on very important aspects of international relations for this country and within the G7. But, as I must repeat to the House, the detailed policy agenda is being discussed with G7 partners and will be announced by the Prime Minister in due course.
The Earl of Sandwich (CB) [V]
My Lords, I declare an interest as an adviser to the British College in Kathmandu. The UK-led global education summit next year proves how much this Government value international development. So how can HMG maintain their G7 leadership role in aid giving if, against the advice of senior colleagues, they are determined to sacrifice soft power and legislate against the 0.7% target which has brought so much relief to the poor throughout the world?
Lord True (Con)
My Lords, I repeat that, despite the budgetary decision announced by the Chancellor yesterday, the UK will remain the second-highest aid donor in the G7—more than France, Italy, Japan, Canada or the United States—with next year’s figure estimated at around £10,000 million.
Lord Collins of Highbury (Lab)
My Lords, this crisis is global as much as it is domestic. In 2008 Gordon Brown persuaded fellow leaders to act as one, agreeing a synchronised stimulus alongside aid for developing countries. What is shocking this time is that the world’s leaders have done so little work together in response. On the progressive agenda for the G7, can the Minister tell us whether the work already started with the Finance Ministers in relation to debt relief will continue? Will he give us an update on this and will it be a priority for the G7 presidency ahead?
Lord True (Con)
My Lords, as I have said, the Prime Minister will be announcing details in due course. I understand that my right honourable friend the Foreign Secretary will make a Statement in another place later; I cannot anticipate that. But I agree with the noble Lord opposite that the G7 does have a track record of delivering meaningful outcomes under successive leaderships. Indeed, it has taken action to save 27 million lives from AIDS, tuberculosis and malaria.
Lord Oates (LD)
Does the Minister recognise that a key priority for the G7 must be how it supports developing economies, which have suffered the severest economic impacts from Covid? Is it not therefore disgraceful that the Government have chosen this exact moment to betray our commitment to the poorest in the world in order, shamefully, to spend the money on weapons instead?
Lord True (Con)
My Lords, the noble Lord’s intervention was strong on adverbs and adjectives. I will give your Lordships a fact: 0.5%, or £10,000 million, whatever noble Lords say, is more than all 29 members of the OECD development committee contribute. Their average is 0.38%. I repeat that we are the second-highest donor in the G7 and will remain so.
Baroness Boycott (CB)
Several countries have announced contributions to help replenish the Green Climate Fund to reach a total of £5.5 billion. The Minister has made it clear that climate change will play a big part in the G7. Presumably, a lot of agreements will get made around this table which can then be presented in Glasgow next year. How far has this particular fund got, taking into account that Covid has caused a lot of financial problems? Is it going to meet that target?
Lord True (Con)
My Lords, unfortunately, I was not able to catch every word of the noble Baroness’s question but certainly, as I have said, the commitment to helping the fight against Covid, such as through the COVAX initiative, will continue, and I can confirm that climate change will be one of the priorities, as I said in my opening Answer.
Baroness Verma (Con)
My Lords, does my noble friend agree that the G7 also has a responsibility to look at how it will respond to women and girls, post Covid, because the biggest impact has been on them? Will he please ensure that, as we hold the presidency, they will be at the forefront of access to finance for enterprise and education?
Lord True (Con)
My Lords, my noble friend makes a profoundly important point. Again, within the constraints of not being able to anticipate announcements, I say that further details will come. What I can say to her is that, as she and I are both aware, girls’ education and training have always been a priority for the Prime Minister, and I am certain that he will drive that forward through the G7 discussions.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, all supplementary questions have been asked and answered and we now move to the next Question.
Special Educational Needs
Lord Blunkett
To ask Her Majesty’s Government what progress they have made (1) in developing the SEND Futures initiative, and (2) in their internal review of special educational needs provision.
Baroness Penn (Con)
My Lords, we are determined to deliver lasting improvements to the SEND system, taking into account the impact of Covid-19. We remain committed to the cross-government SEND review and intend to publish findings early next spring. The SEND Futures research study is progressing well. The value-for-money feasibility study was published on 5 November and fieldwork for the longitudinal study, which will track the outcomes and experiences of children, is set to commence in March.
Lord Blunkett (Lab)
My Lords, before Covid there was a welcome in this House for the capital spend on additional physical places for special educational needs, but a deep worry, which has been reinforced by Ofsted’s most recent report and by the knowledge we have across the country, that young people with special educational needs and disabilities are the ones who have lost out most during the Covid crisis. Surely the Government will now come forward with programmes that will use the existing £350 million for tutoring, but without the charge on schools of having to find a quarter of the cost, which is making it prohibitive in terms of being able to deliver the kind of support that all of us would wish for.
Baroness Penn (Con)
My Lords, the Government absolutely recognise that children with special educational needs have been hard hit by the Covid crisis. We are pleased that the vast majority of them are now back in school. I say to the noble Lord that in the other part of that catch-up package—the £650 million to support schools to make up for lost teaching time—specialist settings are getting £240 per funded place in comparison with mainstream schools, which get £80 per pupil. That additional weighting is to reflect the higher costs of specialist settings.
Lord Wigley (PC) [V]
My Lords, I draw attention to my relevant interests in the register. Will the Minister assure the House that the outcomes of the review will not lead to any dilution or reduction of those rights and protections for children and their parents that are provided for in current legislation?
Baroness Penn (Con)
My Lords, without pre-empting the results of the review, I can give the noble Lord that reassurance. The aim of the review is to improve outcomes for children and their families across the country, deliver on commitments that we have made in legislation and improve value for money for the investment that we are putting in.
Lord Kirkhope of Harrogate (Con) [V]
My Lords, following the recent, welcome feasibility study and its conclusions, is it not nevertheless now even more difficult to design comparable but specific plans everywhere for individual children and young people with EHC needs?
Baroness Penn (Con)
The feasibility study findings re-emphasise that there are diverse levels of support needs and differing approaches to meeting these needs. The challenge that this presents is something that the SEND review is addressing. The findings confirmed that it is feasible to undertake a value-for-money assessment in the near term, and also outlined how to fill existing evidence gaps in order for the department to complete more value-for-money assessments over the longer term.
Lord Ramsbotham (CB) [V]
My Lords, will the Minister please tell the House whether government provision includes young offenders with special educational needs?
Baroness Penn (Con)
My Lords, the Government have a commitment to deliver for young people with special educational needs, regardless of the setting that they are in. That includes young offenders.
Baroness Massey of Darwen (Lab) [V]
My Lords, the SEND review is most welcome and urgent. Charities such as Sense are fighting for families to get special needs recognised and addressed, particularly at this time of Covid crisis. Often, complex needs such as autism might not be recognised for a long time, if ever. Will the Minister say how the review is addressing such complex needs and what extra support is needed?
Baroness Penn (Con)
One of the key principles of the review is co-production with parents, families and carers, so that they can input into that review their diverse range of experiences. I cannot pre-empt the outcome of that review, but I can tell the noble Baroness that we are already putting additional resources into the system, with £730 million going into high needs next year, which is a 10% increase.
Lord Addington (LD)
My Lords, I remind the House of my declared interests. Does the Minister agree that many parents have to fight to get their child recognised as having special educational needs? We simply do not train our teachers sufficiently to spot even the most commonly occurring conditions, such as dyslexia, which affects about 10% of the population. Does she agree that, unless this is dealt with, there will always be problems later on when people try to catch up when problems are spotted?
Baroness Penn (Con)
My Lords, since 2018 the department has funded the National Association for Special Educational Needs on behalf of the Whole School SEND Consortium for a programme of work to embed SEND into school improvement practice and equip the workforce to deliver high-quality teaching across all types of SEND, including dyslexia.
Lord Lucas (Con) [V]
Does my noble friend agree that the enormous difference between local authorities in the rate of giving EHC plans, the huge variation in schools in the percentage of children labelled as having SEND, and the variation in SEND by birth date all indicate that we have serious problems in both diagnosis and definition? Does she agree that, unless these are sorted out first, any data that we collect is going to be seriously compromised?
Baroness Penn (Con)
My Lords, one of the things that the SEND review wishes to address is the differing experience across the country. It is looking at ways to ensure that people receive consistently high-quality services across the country, regardless of where they live.
Lord Bassam of Brighton (Lab) [V]
[Inaudible] Labour has managed to identify that £300 million will be spent in 2021-22 on children with special educational needs and disabilities. Can the Minister confirm that this is all new money and advise the House as to how many new places that will support? How will the Government ensure that we have an integrated strategy across the education, health and care sectors and what further thought have they given to ensuring that poorer-performing authorities level up so that young people with special educational needs and disabilities have fair access to services, regardless of their postcode?
Baroness Penn (Con)
My Lords, I am afraid that I missed the beginning of the noble Lord’s question, but I believe he may have been referring to the £300 million that we are investing in capital projects to support the creation of new high-needs places and improve existing provision across a range of settings, including mainstream and special schools. On support for local authorities that may be struggling with the delivery of their support services, we have started a programme of visits by Ofsted and the CQC, working with local areas to understand the experiences of children and young people with SEND and their families during the pandemic and to make recommendations for improvements.
Lord Singh of Wimbledon (CB) [V]
My Lords, SEND pupils comprise a whole spectrum of children with widely varying behavioural and medical problems, requiring individually tailored intervention to maximise the education and life chances of the child. Does the Minister agree that close liaison with parents or carers is key both to combating behavioural problems before these become entrenched and to understanding and meeting medical needs?
Baroness Penn (Con)
My Lords, I absolutely agree with the noble Lord about the important role of parents and carers; that is why we have put co-production at the heart of our work on special educational needs.
Baroness Eaton (Con) [V]
My Lords, delays in education, health and care plans—worsened by Covid—are hindering children with 22q and 3q29 and other genetic disorders from accessing either places at special schools or additional support in mainstream settings. I have familial experience of these genetic conditions, but they are largely misunderstood, making EHC plans particularly essential for accessing timely help with disabilities, which are often hidden. What are the Government doing to reduce delays and heighten awareness of the myriad complications arising from genetic disorders?
Baroness Penn (Con)
My Lords, as I said in an earlier answer, we have started a programme of visits by Ofsted and the CQC, working with local areas to understand the experience of children and young people, and helping local areas prioritise and meet their needs where, for example, there might be delays in producing education, health and care plans. The Government have also made more resources available: £4.6 billion has been made available to councils to respond to the pressures of Covid, including funding for children’s services.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, the time allowed for this Question has now lapsed. I apologise to Baroness Hussein-Ecce, as we did not have time for her question.
Rural Economy
(4 years, 1 month ago)
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The Lord Bishop of St Albans
To ask Her Majesty’s Government, further to their response to the report by the Select Committee on the Rural Economy Time for a strategy for the rural economy (HL Paper 330, Session 2017-19), what progress they have made towards their strategic vision for rural communities.
The Lord Bishop of St Albans
I beg leave to ask the Question standing in my name on the Order Paper, and I draw attention to my interest in the register as president of the Rural Coalition.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Gardiner of Kimble) (Con)
My Lords, our vision remains that rural communities should prosper, benefiting from the full range of government policies designed to level up opportunity and take the country forward. Defra will shortly publish the first annual rural proofing report on how the needs of rural areas are being addressed across all domestic departments.
The Lord Bishop of St Albans
I thank the Minister for that reply. The Government’s commitment to rural communities is welcome and, I am sure, forms a major part of strategies such as the UK shared prosperity fund, the Covid-related green recovery fund and the levelling-up agenda. The Campaign to Protect Rural England noted the lack of funding for rural areas in the comprehensive spending review. What actual evidence do Her Majesty’s Government have that the rural proofing promised in their response is making a real and significant difference? Could the Minister give us some specific examples? If not, could he write to me with those examples?
Lord Gardiner of Kimble (Con)
My Lords, I think the best thing here is that I will be able—very soon, I hope—to furnish the House with the first rural proofing report. Following this House’s Select Committee report work has been under way on the formation of a rural affairs board, and indeed, because of Covid, the Rural Impacts Stakeholders Forum, of which the CPRE is a member.
Baroness Chisholm of Owlpen (Con)
My Lords, as we know, one size does not fit all when it comes to our rural communities; Norfolk’s needs are not the same as Cumbria’s. I ask my noble friend to ensure that the Government take note of local data gathered together by community agencies when they come to think of their infrastructure and other policies that they want to make for these already very fragile communities.
Lord Gardiner of Kimble (Con)
My noble friend is right. Rural areas can be very different from each other, and we believe that local people are often best placed to judge what is right for their communities. For instance, the Government provide grants of up to £18,000 to groups that wish to pursue a neighbourhood plan. Defra itself provides funding to the 38 rural community councils across England.
Lord Berkeley of Knighton (CB) [V]
My Lords, I declare my interests as listed in the register. I am sure the Minister will agree that one of the greatest problems in rural communities is employment. Therefore, with the Government moving towards more environmentally friendly support for agriculture, might there not be possibilities to employ more people—for example, to do things that are labour intensive, such as planting trees? Secondly, transport is essential for farm workers. Have the Government thought about how the move to electronic vehicles might impinge on the ability of farm workers, who are on very low salaries, to buy these cars?
Lord Gardiner of Kimble (Con)
My Lords, on the transport issue, on Tuesday the Department for Transport launched a call for evidence to shape a future rural transport strategy. I shall take back to the department what the noble Lord said. On the economy, everything that we have been doing, not only through the Covid crisis but throughout, is to ensure that there are vibrant opportunities and indeed many small and medium-sized enterprises in the countryside, which we wish to support.
Baroness Pitkeathley (Lab) [V]
My Lords, today is Carers Rights Day. The latest research shows that carers have had to take on huge extra responsibilities during the pandemic. Their needs may be particularly acute in rural areas as many voluntary and community services have simply disappeared. Does the Minister agree that any rural policy must make support for community and voluntary services that support carers and those they care for an absolute priority?
Lord Gardiner of Kimble (Con)
My Lords, I absolutely endorse that the work of carers throughout our community has been absolutely profound during this crisis. The Department of Health and Social Care is working on addressing the main health and care inequalities—particularly, in this case, as experienced by people in rural areas—and continuing to ensure that a higher share of funding goes to geographies with high health inequalities.
Baroness Bakewell of Hardington Mandeville (LD) [V]
My Lords, the County Councils Network has recently conducted work on the effect of Covid on the decline of the rural bus network. The Government are committed to a rural bus strategy, but will the Minister give assurance that consideration will be given to providing a range of passenger transport services to provide positive benefits to residents in rural areas?
Lord Gardiner of Kimble (Con)
My Lords, the Government have provided £220 million of new funding to support a better deal for bus users. This includes £20 million for the rural mobility fund to trial new on-demand services and to improve existing services in rural and suburban areas.
Baroness Hayman of Ullock (Lab)
Askham Bryan College has stated its intention to close the Newton Rigg agricultural college in Cumbria, saying that students may wish to explore options at other colleges regionally. However, Cumbria’s young people need to learn how to farm in Cumbria, where its unique landscape brings unique challenges. Can the Minister clarify that the Government support the ongoing needs of agricultural and rural industries in Cumbria through the vital and sustainable future of Newton Rigg College?
Lord Gardiner of Kimble (Con)
I assure the noble Baroness that that is hugely important. We agree that attracting bright new talent into agricultural and horticultural careers and having a skilled workforce in place are vital for the future of UK food and farming. My understanding on Newton Rigg agricultural college is that the Department for Education is looking at the matter very closely.
Baroness Redfern (Con) [V]
My Lords, rural economies have untapped potential as well as challenges. From living in a rural environment, I understand how important our rural economy and personal well-being is. However, there are concerns in particular about action on surface water flood risk to homes and businesses. How are the Government enforcing their drive to bring together all partners to improve the management assessment of surface water flood risk to make our rural places, infrastructure and growth more resilient to our future climate?
Lord Gardiner of Kimble (Con)
My Lords, the Government will double the amount we invest in the flood and coastal defence programme in England to £5.2 billion over six years from 2021. This will help to protect a further 336,000 properties, including 290,000 homes.
Lord Curry of Kirkharle (CB) [V]
My Lords, my interests are as recorded in the register. Yesterday the Chancellor reaffirmed the Government’s commitment to the long-awaited shared prosperity fund, which the right reverend Prelate mentioned. Can the Minister confirm that there will be a committed element of the fund dedicated to the rural economy, as recommended in the report Time for a Strategy for the Rural Economy?
Lord Gardiner of Kimble (Con)
My Lords, I confirm that the UK shared prosperity fund will take into account the specific needs of rural communities and will help to support investment in rural infrastructure as well as rural businesses.
Baroness Mallalieu (Lab) [V]
I declare my interests as stated in the register. With increasing numbers of people wanting to both live and work in the countryside, what steps are Her Majesty’s Government proposing to take to ensure that rural areas are not left behind in the rollout of 5G as they were with broadband?
Lord Gardiner of Kimble (Con)
That is absolutely why we are investing and working with the £5 billion programme to support the rollout of gigabit-capable broadband, as well as the joint investment of over £1 billion in the shared rural network on mobile, both of which are extremely important. It is the case that 5G is a continuing challenge for the hard-to-reach areas, and that is what we want to work on in particular.
Lord Foster of Bath (LD)
My Lords, given the Minister’s very clear promise to the committee that I had the privilege to chair that there would be robust rural proofing of all government policies, how does he explain the clear absence of rural proofing in the Government’s recent proposals on changes to the current planning system, which will have a devastating and disproportionate effect on the provision of affordable homes across rural England?
Lord Gardiner of Kimble (Con)
My Lords, affordable homes are clearly important, including in rural communities. Two consultations are going on at the moment—on changes to the current planning system and planning for the future. We in Defra will work closely with our MHCLG colleagues on the matter.
The Earl of Caithness (Con)
My Lords, in their reply to the committee chaired by the noble Lord, Lord Foster of Bath, the Government said:
“The Minister for Rural Affairs … is specifically charged with ensuring that the needs of rural areas are taken into account across all government business.”
How many meetings has the Minister had with fellow Ministers, and what further meetings does he propose to have to combat the sort of unintended problems that the noble Lord, Lord Foster, has just mentioned?
Lord Gardiner of Kimble (Con)
I have many meetings; I have had meetings on digital, on crime and on a range of other issues. As I mentioned, as part of the response to the Covid-19 pandemic, we formed a rural impact stakeholder forum comprising many of the key stakeholders we work with, so that we could we in Defra could respond to other Whitehall departments about the specific dynamic of difficulties—for instance, with the pandemic—in rural areas. I continue to work on that. The stakeholder forum was meeting weekly; it now meets fortnightly. That work, as well as the work of the rural affairs board, is very important.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, all supplementary questions have been asked and answered, and we now move to the fourth Oral Question.
Official Development Assistance
(4 years, 1 month ago)
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Lord Bruce of Bennachie
To ask Her Majesty’s Government what assessment they have made of their statutory obligation to spend 0.7 per cent of gross national income on official development assistance.
Lord Bruce of Bennachie (LD) [V]
My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and draw attention to my entry in the register of interests.
The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)
My Lords, the Covid-19 pandemic has had a severe impact on our economy, which has fallen by 11% this year. This has forced Her Majesty’s Government to take a tough decision to spend 0.5% of our national income next year on official development assistance to help the poorest countries, rather than the usual 0.7%. My right honourable friend the Foreign Secretary will shortly set out in the other place the future plan on how the aid budget will be managed to deliver better results for every penny spent, and to ensure that it is focused on strategic global priorities, which are vital as we recover from the pandemic and prepare for our presidencies of both the G7 and COP 26 next year.
Lord Bruce of Bennachie (LD) [V]
My Lords, I pay tribute to the noble Baroness, Lady Sugg, for her honourable decision to resign from the Government yesterday in protest at the decision to cut aid, which she clearly stated she could not defend. She achieved a great deal in her role, and she was a pleasure to work with. I wrote yesterday that the decision was “unconscionable and mean-spirited”. It is all the more shameful because the Government fought two elections in quick succession committed to 0.7%, and this guarantee was repeated by the Foreign Secretary, and by the Prime Minister in a letter to me, when DfID was absorbed into the Foreign Office a few short months ago. The 0.7% is enshrined in law. Do the Government intend to disregard the law again, or will they seek to amend it? Will legislation come before this House? Is the Minister aware that the law allows for a legitimate retrospective shortfall, but not for a planned cut in the 0.7%?
Lord Ahmad of Wimbledon (Con)
My Lords, I join the noble Lord in his tribute to my noble friend Lady Sugg. She was not only a noble friend but a friend within the FCDO, and will be sorely missed both by the department and, I am sure, by your Lordships’ House in this role. As I have said, my right honourable friend the Foreign Secretary will lay out some details on the issue of legislation. The noble Lord has raised two important points, and I can assure him that we are very cognisant of our obligations both in terms of the Act and to the House. As for the cut that has been announced, as my right honourable friend the Chancellor of the Exchequer laid out only yesterday, it was a difficult decision, but it was necessary on the basis of the challenges we face. None the less, in real terms we will still spend £10 billion to fight poverty and climate change, among other key priorities in overseas development.
Baroness Blackstone (Ind Lab)
My Lords, the Minister has paid tribute to the noble Baroness, Lady Sugg. I too want to pay tribute to her for her honourable decision to resign when the Government broke their manifesto commitment on development assistance. She said that was fundamentally wrong. Does the Minister agree with this, and with her letter to the Prime Minister, which said:
“Cutting UK aid risks undermining your efforts to promote a global Britain and will diminish our power to influence other nations to do what is right”?
In answering that question, perhaps he would also indicate when the Government intend to restore development assistance to 0.7% of GNI.
Lord Ahmad of Wimbledon (Con)
My Lords, on the noble Baroness’s first point, I have already mentioned my long support of and friendship with the noble Baroness, Lady Sugg. Of course, she discussed her decision with both the Prime Minister and my right honourable friend the Foreign Secretary. I pay tribute to her efforts and her work in both DfID and the FCDO. As the Chancellor said only yesterday, the cut is temporary and we will return to the 0.7% when the fiscal situation so allows.
Baroness Sheehan (LD)
I too pay tribute to the noble Baroness, Lady Sugg, who was an outstanding Minister, and who acted with integrity yesterday. The £2.9 billion cut in the aid budget already announced for this year represents a cut of more than 19%—far more than the projected 11.3% drop in GNI. Will the Minister support the Government if they choose to break the law and knowingly undershoot the 0.7% target?
Lord Ahmad of Wimbledon (Con)
My Lords, in the current year we will meet the 0.7% target. On our obligation to your Lordships’ House to uphold the laws on the statute book, I have already alluded to the fact that my right honourable friend the Foreign Secretary will lay out further detail shortly in the other place.
Baroness Meyer (Con)
My Lords, the gang of five Prime Ministers, in objecting to a temporary reduction in our aid budget, surely protest too much. Is it not the case that, despite our enduring the worst economic crisis in 300 years, the UK provision of international aid, at 0.5% of GNI, will still be one of the highest in the world, and the second highest in the G7 group of industrialised countries?
Lord Ahmad of Wimbledon (Con)
My Lords, my noble friend is right: we will remain one of the most generous G7 donors, spending more of our national income, in percentage terms, than the United States, Japan, Canada or Italy. I further assure my noble friend that we stand very firmly in ensuring that, when we look at poverty alleviation, fighting famine, our commitment through the various vaccine summits we have held and the importance of our COP 26 presidency —with the commitment we have made on climate finance —we stand ready to continue to meet our obligations both domestically and internationally.
Lord Crisp (CB) [V]
My Lords, this cut is short-sighted and mean-spirited; it will damage our national interests and scar the lives of millions. Disturbingly, there is no end point. We are all aware of the financial situation, but what other options were considered? The UK will spend billions on vaccines from its aid budget and elsewhere for people in low and middle incomes as well as its own citizens. Could it not have made a virtue of this by using the aid budget to commit to vaccinations for all, not just making a cut but demonstrating UK leadership on the protection of the world’s health and providing a welcome boost for UK science and technology? Was this considered, and why was it not done? If the Minister does not know the answer, I would be grateful for a letter.
Lord Ahmad of Wimbledon (Con)
I do not agree with the noble Lord. On the specific issue of the vaccine, he will recall that, when my right honourable friend the Prime Minister returned from his own challenge with Covid-19, the first summit he chaired was the Gavi summit, which committed £330 million per year to other vaccines. As the Minister responsible for south Asia, I know that issues of polio still impact vulnerable communities in places such as Afghanistan and Pakistan. Equally, we have led from the front on the importance of the Covid-19 vaccine, with a commitment of £571 million to the COVAX Facility. The Covid-19 challenge, along with climate finance, are arguably the two biggest challenges facing the world today and through 2021, and we have shown leadership on both and will continue to do so.
Lord Collins of Highbury (Lab)
My Lords, I, too, praise the noble Baroness, Lady Sugg, and hope that we can work on a cross-party basis to oppose this move by the Government. The Minister said that there would be £10 billion of ODA in 2021-22, but this represents a cut of £5.1 billion compared to 2019. Yesterday, the noble Lord, Lord Parkinson, said that the Foreign Secretary’s savings for this financial year to maintain the budget within 0.7%—and we should not forget that that has meant real cuts—
“prioritised the UK’s global response to the Covid-19 pandemic, including on poverty reduction for the bottom billion, climate change and reversing biodiversity loss, championing girls’ education and protecting our operational capacity.”—[Official Report, 25/11/20; col. 249.]
Will the Minister tell us which of these priorities will now be cut to meet the Chancellor’s breach of the law and the Conservative manifesto?
Lord Ahmad of Wimbledon (Con)
My Lords, the short answer to the noble Lord is that they remain, and will continue to be, priorities, and I note the additional support that we have announced within the defence budget, for example. As Minister for the UN, I am sure that all noble Lords acknowledge the vital role our Armed Forces play in the delivery of aid, bringing peace and resolving conflict. We will ensure that the priorities my noble friend listed only yesterday will continue to be sustained and strengthened through 2021.
Lord Roberts of Llandudno (LD) [V]
Have the Government been in touch with the new incoming regime in the USA? It seems that President-elect Biden will be far more ready to co-operate with us on these massive problems in relation to overseas aid.
Lord Ahmad of Wimbledon (Con)
My Lords, my right honourable friends the Prime Minister and the Foreign Secretary have both been in touch with incoming Biden Administration on these important priorities.
Baroness Tonge (Non-Afl) [V]
My Lords, I, too, add my dismay about the resignation of the noble Baroness, Lady Sugg. Does the Minister agree with the World Bank that the provision of sexual and reproductive health and family planning services alongside girls’ education is the most effective intervention we can make in developing countries? Will he, therefore, ensure that, despite the reduction in overseas aid, the money currently donated for those services will remain unchanged and will not be reduced proportionately?
Lord Ahmad of Wimbledon (Con)
My Lords, on that very issue, as the noble Baroness will know, I articulated very strongly for us to sustain our support for this important priority. As the noble Baroness may be aware, between April 2015 and March 2020, we reached an average of 25.3 million women and girls accessing modern methods of family planning per year. This remains an important priority, and, as the lead on PSVI in particular, I say that this remains very much in my policy and planning.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, the time allowed for this Question has now elapsed. I apologise to the noble Baronesses, Lady Nicholson and Lady Armstrong, and the noble Lord, Lord Bilimoria, who were unable to put their questions.
Common Organisation of the Markets in Agricultural Products (Producer Organisations and Wine) (Amendment etc.) (EU Exit) Regulations 2020
(4 years, 1 month ago)
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Lord Gardiner of Kimble
That the draft Regulations laid before the House on 5 and 19 October be approved.
Relevant documents: 31st and 33rd Reports from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 18 November.
Arrangement of Business
The Deputy Speaker (Lord Brougham and Vaux) (Con)
My Lords, hybrid proceedings will now resume. If the capacity of the Chamber is exceeded, I will immediately adjourn the House.
We now come to the consideration of Commons reasons on the Parliamentary Constituencies Bill. These proceedings will follow guidance issued by the Procedure and Privileges Committee. When there are counter-propositions, any Member in the Chamber may speak, subject to usual seating arrangements and the capacity of the Chamber. Any intending to do so should email the clerk or indicate when asked. Members not intending to speak on a group should make room for Members who do. All speakers will be called by the Chair.
Short questions for elucidation after the Minister’s response are permitted but discouraged; a Member wishing to ask such a question, including Members in the Chamber, must email the clerk. The groupings are binding. Leave should be given to withdraw.
When putting the Question, I will collect the voices in the Chamber only. Where there is no counter-proposition, the Minister’s Motion may not be opposed. If a Member speaking remotely intends to trigger a Division, they should make this clear when speaking on the group. Lords following proceedings remotely but not speaking may submit their voices, Content or Not Content, to the collection of the voices by emailing the clerk during the debate. Members cannot vote by email; the way to vote will be via the remote voting system.
Parliamentary Constituencies Bill
Thursday 26th November 2020
(4 years, 1 month ago)
Lords ChamberRead Full debate Parliamentary Constituencies Act 2020 View all Parliamentary Constituencies Act 2020 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 151-I Marshalled list for Consideration of Commons reasons - (24 Nov 2020)
15:07 - Division conducted remotely on Motion E1 (as an amendment to Motion E) - Ayes: 129 / Noes: 276 - Motion E1 (as an amendment to Motion E) disagreed.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, in moving Motion A, I will also speak to Amendments 2, 6, 7 and 8, on which I shall also beg to move that the House do not insist on those amendments, to which the Commons have disagreed.
Amendments 1 and 2 provide that a boundary review would be carried out every 10 years. The Commons have opted to disagree to these amendments, as eight years is deemed a better balanced and appropriate approach to ensure that parliamentary constituencies are updated sufficiently regularly without disruption to local communities and their representatives.
The Commons disagree to Amendment 6, which proposes a bespoke appointment system for boundary commissioners. The Commons consider that the existing public appointments system and the requirements of Schedule 1 to the Parliamentary Constituencies Act 1986 are sufficient. The public appointment system used to recruit commissioners is robust and has led to the appointment of impartial and effective candidates for decades.
The noble and learned Lord, Lord Thomas of Cwmgiedd, has since tabled an amendment in lieu on this topic, which we will return to in more detail later. However, I wanted to take the opportunity at this point to thank the noble and learned Lord for his constructive and positive approach to engaging with me and officials, and indeed other senior Ministers in the Government, on his amendment throughout the passage of the Bill. It was a model of the approach for a revising Chamber.
We have had many conversations at every stage since this Bill entered the Lords and have thoroughly debated the aspects of the amendment. Even though the Government were unable to accept the noble and learned Lord’s amendments, I hope he has found our exchanges of a good nature and believes that they have resulted in reassurances that made them worth while.
Under Amendment 7, the number of voters in each constituency would be permitted to vary from the UK average by plus or minus 7.5%, which equates to a total tolerance range of 15%. The Commons—the elected House—consider that the existing law on this matter, that of a tolerance range of 10%, is sufficient to ensure equal parliamentary constituency boundaries.
Finally, turning to Lords Amendment 8, this required the Government to make proposals for improving the completeness of electoral registers. The Commons consider that the Government have provided sufficient explanation of action they have taken and are taking to improve the completeness of the electoral registers.
I would like to take this opportunity to pay my respects to the noble Lord, Lord Shutt of Greetland, who so sadly passed away and who tabled the original amendment. It was a privilege to call him my noble friend when he was my Deputy Chief Whip during the years of coalition. In those Quaker values which have so enriched the Liberal party—as it was—and the Liberal Democrats over generations were rooted his principles of straight talking and straight dealing, which we all remember, as we remember his passion for his work and his good humour. He will be sorely missed, particularly by colleagues on the Liberal Democrat Benches.
Since then, the noble Lord, Lord Woolley, who had not previously taken part in the Bill, has tabled a new amendment in lieu. The Government cannot accept this amendment for reasons I have privately explained to the noble Lord, Lord Woolley, but we will no doubt have an opportunity to discuss this further.
As is quite proper, this House asked the Commons to re-examine the detail of this Bill. The House of Commons did so and have returned a Bill to us that is now ready to go to Her Majesty for Royal Assent. The elected Chamber, to which this Bill directly relates, has considered your Lordships’ amendments, and indeed accepted three in relation to the automaticity provisions, and has made its will now known. I therefore urge noble Lords not to insist upon these amendments. I beg to move.
Lord Thomas of Cwmgiedd (CB) [V]
My Lords, I begin by thanking the Minister for the courtesy and pleasure, if I may say so, of being able to debate the issues that lay behind the original amendment I put forward. I am extremely grateful to him for the courtesy and the trouble to which he has gone, and to his officials, who went beyond their ordinary tasks even in these most difficult times to help me.
I have put forward today an amendment to the original clause that was carried by this House. It is plain that the original clause would have brought about a better appointment system, but the decision has been made by the other place that they do not agree. As regards the amendment I have tabled today, it deals with a narrow and specific point of some constitutional importance. That is why I have put the amendment forward: to amend the clause on a very narrow basis.
However, I wish to make it clear now that I do not intend to press this amendment to a Division because, in the ultimate analysis, it must be for the other place to accept it. However, given the times in which we live, I think it is important to record the matter formally, because it may turn out to be of great importance in the future. As regards the more general points, they are of very considerable relevance at the present time. Although in what I have to say I will be a little critical of the Government, I wish to make it abundantly clear that anything I say in no way criticises the present Secretary of State and Lord Chancellor. This is a more general point, directed at the Government as a whole, now and for the future.
The amendment today, on this narrow point, has the objective of bringing the provisions for the appointment of the deputy chairman of the Boundary Commission into line with the principles of the Constitutional Reform Act 2005, which changed the position of the Lord Chancellor. Noble Lords may recall that the debate on the position of the Lord Chancellor was an extensive one. There were very detailed discussions between the judiciary, at that time led by the noble and learned Lord, Lord Woolf, and the Department for Constitutional Affairs led by the Lord Chancellor— as he then truly was—the noble and learned Lord, Lord Falconer of Thoroton.
A concordat was reached in 2004, which sets out very clear principles that were embodied in the Bill. Those principles were that the deployment and appointments to posts of judges were for the Lord Chief Justice. In respect of some, the Lord Chief Justice was obliged to consult the Lord Chancellor and, in the case of one or two, obtain his concurrence, but the important point is that the decision was that of the Lord Chief Justice. That was because the Lord Chancellor ceased to have any judicial functions and to be head of the judiciary. That is a basic and fundamental constitutional position. The Lord Chief Justice became head of the judiciary and responsible for judicial deployment and the allocation of responsibilities and—importantly—of cases.
The power of appointment to the post of deputy chairman of the Boundary Commission dates from a time when the Lord Chancellor was a judge and head of the judiciary. It is noticeable in the Act that the powers of the Lord Chancellor did not extend to the appointment of the deputy chairman in Scotland or Northern Ireland, because the Lord Chancellor was not head of the judiciary there. Unfortunately, though I think it is hardly surprising, having been involved myself at the time, this provision was overlooked. There were literally hundreds of posts and duties that the Lord Chancellor had accreted over the centuries; that one or two slipped by is not surprising. It is essential to rectify the position now for two reasons: first, to correct an error and, secondly—far more importantly—because the position of the Boundary Commission has changed. It is no longer advisory and its decisions are not subject to any review by Parliament; it decides and Parliament and the Executive Government carry out the decision. The position, as I made clear on the last occasion, is no different to the selection of someone to decide a case. When a judge decides a case, the matter must be enforced by the Executive and adhered to by Parliament. It is quite clear that the Lord Chancellor could not pick a judge to decide a particular case; it would be wrong.
As I could not understand why the Government were opposing this change, I asked three question that I hoped would elucidate the reasons for the decision. I asked if the Lord Chancellor was satisfied that a decision by him as Lord Chancellor, or by any successor, personally to appoint the deputy chairman would be in accordance with legal principles, given that it would be a decision in which the Lord Chancellor—unless he were a peer, which was of course the case prior to 2005—had an actual interest, as the Commission would be determining the boundaries of the Lord Chancellor’s own constituency. The answer I got was that, in making such an appointment, the Lord Chancellor would have to act within established law principles. It seems clear that the Government accept that there is a personal interest in this matter. My second question was whether it would be susceptible to a legal challenge. To that I got the answer that in making such an appointment the Lord Chancellor would have to act within established public law principles. Thirdly, I asked whether it was consistent with the duty placed on the Lord Chancellor to uphold the continued independence of the judiciary. The answer was that is not inconsistent for the Lord Chancellor to have a role in appointments that involve the selection of one member of the judiciary over another. Indeed, because the Lord Chancellor is still ultimately accountable for senior court appointments, it was considered sufficiently important for there to be ministerial accountability to that extent for the judicial appointment system. The same could be said of these appointments.
Baroness Scott of Bybrook (Con)
My Lords, the noble and learned Lord has been speaking for 20 minutes. Could he now wind up, please?
Lord Thomas of Cwmgiedd (CB) [V]
I will be a moment longer. I just want to add one final point—and it is this. One can see the damage done when a country such as China criticises Her Majesty’s Government for going back on a treaty. Its comments speak for themselves.
I will conclude by saying that we should be vigilant for the future. The threat to the rule of law is still there, and there are more matters to come. I hope very much that on future occasions this Government will be much more careful about the independence of the judiciary and the rule of law.
Lord Woolley of Woodford (CB)
My Lords, I first apologise to the House and my fellow noble Lords for coming to this debate very late in the day. I am new to the Chamber, as many noble Lords will know, and I would argue that I and many others were thrown off track by the pandemic. I apologise, and for that reason I will not be putting my amendment to a vote—because I respect noble Lords and I respect this House.
However, I will not apologise for wanting to ensure that hundreds of thousands of young people are registered to vote and have a voice in our society. I have dedicated most of my adult life to ensuring that young people and those from black, Asian and minority ethnic communities can be part of our society—and without a vote, you do not have a voice.
Before I go into that, I pay tribute to David, Lord Shutt, who, as the Minister said, was our friend. I knew David more than 20 years ago when I was an activist, just starting out with Operation Black Vote. We had no money—and no money any time soon. I was asked by Stephen Pittam, who was the social and racial justice director of the Joseph Rowntree Charitable Trust, to put in an application. So I did, and I was called to a panel, and David Shutt was the chair. I said to him, “You and I know that Martin Luther King had a dream. But he had more than a dream. He had a plan. And step one of that plan was to politically empower African Americans and white poor people to be in a situation where they are not asking for justice and equality but demanding it. And they demand it by voter registration, by having a strong voice”. In typical Yorkshire fashion, David turned around and said—I hope noble Lords will excuse my language—“You’ve convinced me. Give him the bloody money, and good luck”. And we then began a journey, going out the length and breadth of our nation to register our communities to vote.
Our focus has been on black, Asian and minority ethnic communities where, as many noble Lords will know, the deficit is the greatest. We laid bare about 10 years ago the fact that more than 50% of young Africans in London were not registered to vote. The average for black, Asian and minority ethnic communities is 25%-plus, when the average across the board is around 15% to 17%. The problem that we are facing is not that there is a neutrality in some of our communities towards registering to vote and voting—there is antipathy towards it. People say, “Why should I vote when I do not see our institutions, locally or nationally, looking like us? There is no representation. How are they going to speak for me?” Too many say, “Why should I vote when policies are not addressing the deep-seated racial inequalities and disparities that affect our lives—in housing, education, health and many other areas? Why should I bother?” We as activists tell our communities and young people across the board, “That’s precisely why you should vote—because if you don’t have a voice, you can’t change anything”.
Twenty-five years later, from activist to one of your own as a fellow Peer, I come into this place and, once again, I bump into my old friend David, the late Lord Shutt. He says to me, “Young man, great to see you. We’ve got work to do. Your first step is to come and make a presentation to our committee”—which I did. He said, “Give us chapter and verse on how we can turn this round. Give us the tools to empower black, Asian and minority ethnic communities and young people across the board.” I said to him, “Look, it’s a no-brainer. At the very first instance, we should have automatic voter registration. You give them the insurance number and you make sure they’re registered. At least then our challenge to get them to vote is halfway done; we just need to give them the tools to do it.”
The Deputy Speaker (Lord Duncan of Springbank) (Con)
My Lords, the following Members in the Chamber have indicated that they wish to speak: the noble Lords, Lord Rennard, Lord Beith and Lord Lexden. I will call each in turn, then if anyone else in the Chamber wishes to speak, they too can be called—[Interruption.] I beg noble Lords’ pardon; they are quite right. The noble Lords, Lord Adonis and Lord Blencathra, both told me that they wished to speak; I just left them off the list because I did not write it down properly. I will call each noble Lord in turn then I will seek any other speakers in the Chamber. To begin with, I call the noble Lord, Lord Rennard.
Lord Rennard (LD)
My Lords, the last words in this House of my late noble friend Lord Shutt of Greetland helped to carry an amendment to this Bill by 293 votes to 215. The majority for that amendment was 78 in a vote in which more than 500 Peers took part and which was supported by more than 80% of the Cross-Bench Peers who voted—but it was not accepted. The whole House should now be grateful to the noble Lord, Lord Woolley of Woodford, for having tabled a compromise amendment on a subject with which he has a long history of involvement and about which he spoke so powerfully and persuasively.
The suggested compromise is based on one of the key recommendations of the Select Committee, which studied electoral registration issues over many months and received evidence from more than 60 people, many of whom are experts in the field. The noble Lord, Lord Woolley of Woodford, was one of those experts. As he said, he has many years’ experience of campaigning with Operation Black Vote on the underrepresentation of black people on electoral registers. He pointed out in his evidence that he has been talking to such committees for more than 10 years; he said that the questions remain the same but there remains a lack of political will to deal with them. He also explained that the introduction of individual voter registration has had a huge impact in reducing the levels of registration from diverse communities.
The noble Lord’s amendment today is not the same as that of Lord Shutt and his colleagues. The Government are not asked in this amendment to consider the introduction of any form of automatic voter registration. In fact, they are not asked to do anything at all except tell us what proposals they have to do what they say they want to do anyway. As the noble Lord, Lord Woolley, said, it is the softest amendment possible. Ministers claim repeatedly that the Government want to improve the accuracy and completeness of the electoral registers. The noble Lord’s amendment simply asks them to consider inviting young people to register to vote when they are notified of their national insurance numbers. Such a notification would cost nothing. The easiest way of registering to vote is with a national insurance number, so the best time to register is when you get your national insurance number.
Young people about to attain the age of 18 are all supposed to be registered and included in the calculations of the Boundary Commissions; their absence, and that of others, makes those boundaries unfair and, many would suggest, gerrymandered. These young people need to be registered in order to vote, obtain credit and be summoned for jury service. However, the latest figures from the Electoral Commission show that 75% of them are not registered to vote, as against only 6% of those aged over 65. This is an enormous disparity. The Government talk about their efforts in relation to registering young people, but if only 25% of those about to turn 18 are registered compared with 45% five years ago, those efforts are clearly failing—unless, that is, their real efforts are to reduce the number of young people registered to vote. If so, they should be honest about voter suppression, which might come from the Donald Trump playbook. Or, if this is not their aim, they should say why they have been unable to provide a single reason for not registering young people in this way. They have not been able to do so at any point in the four months that we have been considering this Bill.
As the noble Lord, Lord Woolley, said, the figures for registering young black people are even worse than they are for young people generally. The Joint Committee on Human Rights recently raised concerns that 25% of black people are not registered to vote, compared with 17% of the total population. If these figures are correct, they would mean that more than 80% of young black people about to attain the age of 18 are not registered to vote—and the danger is that they may never be, and that they may never take part in our democratic society.
This issue affects our democracy. It affects social mobility, as those not registered may not be able to obtain credit when they apply for it. It affects justice, as juries drawn from the electoral registers may be unrepresentative. The criminal sub-committee of Council of Her Majesty’s Circuit Judges recently described problems with jury service, saying that
“there are currently many who are eligible but are not registered to vote and are not called for jury service.”
The amendment tabled by the noble Lord, Lord Woolley, is a compromise. It does not go as far as the Select Committee on the Electoral Registration and Administration Act 2013 recommended, with cross-party support. The principle of registering young people automatically, or in this way, was supported by the senior Conservative election strategist the noble Lord, Lord Hayward, in that Select Committee and in the Grand Committee considering the Bill.
The same principles were strongly supported by the Conservative Party’s official historian, the noble Lord, Lord Lexden, in the Select Committee and on Report. I am pleased that he is again supporting the principle of the amendment today. The last Labour Minister responsible for handling such issues, the noble Lord, Lord Wills, is sadly unable to attend, but he is a strong supporter of the principles of the amendment. All 133 of the 133 Labour Peers who voted on Lord Shutt’s original amendment voted for something that went far further than the amendment from the noble Lord, Lord Woolley, seeks today.
I recently reread the House of Commons debate on Lord Shutt’s amendment. The principle of automatic voter registration was strongly attacked by Mr Jacob Rees-Mogg. He spoke knowing that he had vetoed MPs voting electronically in the same way that we do in this House, so he was speaking in the knowledge that the Conservative Whips could cast around 200 votes as proxies without MPs being allowed even to press a button for themselves. Even from this House we can say that that is an affront to democracy. Even with all his debating skills, Mr Rees-Mogg could voice no argument against notifying young people about how to register to vote when they are notified of their national insurance numbers. That is because there is no democratic argument against it.
The noble Lord, Lord Woolley, skilfully suggested a compromise of the kind that this House should be proud to support. My noble friend Lord Tyler will ensure that there is an opportunity for Members to vote on this issue. Please use your vote today to make sure that young people can vote in future.
Lord Beith (LD)
My Lords, I thank the Minister, the noble Lord, Lord True, for his generous and kind words about Lord Shutt of Greetland—our friend David Shutt. They were very accurate and true. I knew David for over 50 years. He was a liberal to his fingertips, a democrat in every way, a proud upholder of nonconformist and Quaker values, and a proud Yorkshireman. He was a larger than life figure in this place and we will miss him enormously. If there is anything that I can do today by casting a vote that would further the cause in which he so profoundly believed—that young people must be drawn into our democratic system—I will do so with enthusiasm.
I refer to the amendment in lieu from the noble and learned Lord, Lord Thomas of Cwmgiedd. He has worked assiduously on the Bill to try to safeguard the important principles at stake. It was obvious to me and everybody else that, the moment that Parliament could not delay or block Boundary Commission proposals, attention in some political quarters would shift to those who draw up those proposals. The pressure would be on who is appointed as boundary commissioners. It therefore became important to look at that carefully. We have done so over the course of the Bill, but I do not think we have reached an ideal solution.
We are in an anomalous situation on the position of Lord Chancellor, as was pointed out by the noble and learned Lord, Lord Thomas, by detailed reference to the debates on changes to the post, which I remember vividly. I have great respect for the present Lord Chancellor, who served on the Justice Committee when I chaired it. I know that he is committed to the most important principles of our legal system, but this is not an ad hominem case; we cannot make it depend on one individual. It is about the system we have for the future. When many other changes were made, powers previously held by the Lord Chancellor shifted to the Lord Chief Justice, as head of the judiciary. This power should have gone the same way.
Lord Lexden (Con)
My Lords, I support the amendment proposed by the noble Lord, Lord Woolley of Woodford. Like him and other noble Lords on all sides of the House, I deeply regret that the amendment cannot be moved by the noble Lord, Lord Shutt of Greetland, who so effectively made the case for action to get more young people on the electoral registers just a few weeks ago on Report. Lord Shutt of Greetland will be remembered vividly and affectionately by all his colleagues, of whom I was one, who worked with him on the all-party Select Committee that considered the state of our country’s electoral system in detail, seven years after the passage of the Electoral Registration and Administration Act 2013. It would be a fine tribute to his memory if what might be termed the Shutt-Woolley amendment was incorporated in the Bill. If it is not, I hope that something like it wins parliamentary approval before too long.
When I spoke on the earlier Shutt amendment, I asked Members of the House to bear in mind that it provided two alternative routes by which tomorrow’s voters could be brought on to the electoral registers, at the ages of 16 and 17, in readiness to cast their votes when they turn 18. The first, as we have heard, proposed automatic registration if electoral registration officers were satisfied of their eligibility when national insurance numbers were issued. The Shutt amendment offered a second way to the goal, which all supporters of democracy surely must share—that of ending the grave under- participation of young people aged 18 and over in our country’s elections. The second method, as we have heard, involved no more than providing them with information about the process by which the precious right to vote can be acquired.
In responding to the amendment, the Government chose to ignore the second part altogether. Not one word was said about it from the Government Front Bench. Its supporters were called on to vote against it, on the grounds that automatic registration was objectionable in principle—an objection that many Conservatives do not share. The same thing happened when the Shutt amendment was debated in the Commons.
The new version before us omits the provision for automatic registration on which the Government based their entire opposition to the original amendment. The amendment proposes, in modest terms, that it should be permissible for young people, on whom the future success of our country depends, to be notified of what they should do to gain the right to cast a vote and play their part in our democracy. Can there really be a serious argument for not informing our country’s youngsters, who stand at the gateway of democracy, about what they need to do to pass through it, when information can be supplied to them readily and at very little cost as a result of today’s electronic miracles?
The Deputy Speaker (Lord Duncan of Springbank) (Con)
For noble Lords’ information, the next three speakers will be the noble Lords, Lord Adonis, Lord Blencathra and Lord Cormack.
Lord Adonis (Lab)
My Lords, I agree with every word that the noble Lord, Lord Lexden, has said, with the noble Lord, Lord Rennard, and with the very eloquent speech by the noble Lord, Lord Woolley. The Minister said that the House of Commons had given a view on this, but it is perfectly reasonable and normal for us to ask it to think a second time on issues where we believe that there is a very strong public interest, particularly constitutional issues, since we are a constitutional safeguard. There are not many others in our system. One is the courts, and we have heard from a former Lord Chief Justice, who also spoke extremely eloquently about the composition of the Boundary Commissions. When a former Lord Chief Justice raises concerns about possible gerrymandering of the Boundary Commissions, we should take note.
For all the reasons that have been given so far, the issue of engagement of young people in our democratic system is fundamental. It is not a peripheral issue for the future of this country, and it is all the more fundamental because of the current evidence of massive underregistration of young people. The noble Lord, Lord Woolley, spoke with great passion about how ethnic minority groups are even more underrepresented than young people at large. The evidence is that in the 2017 election, only 64%—not even two-thirds—of 18 to 24 year-olds were even on the electoral register, so the rest were not even able to participate unless they went through the laborious process of registering themselves during the election. Many would then have missed the deadline, and I had not even thought about the very powerful point made by the noble Lord, Lord Rennard, that if they are not on the electoral register, they are not available for jury service either. All these attributes of citizenship, which are fundamental to the future of our democracy, they are not engaged in.
Only 64% being registered is a huge condemnation of the status quo. The Minister cannot say that the system works and therefore, “if it ain’t broke, don’t fix it”. The system is fundamentally broken, and not because of changes that go back a long time and which are hard to tackle but because of the introduction of individual registration, a reform introduced only six years ago, and which was itself, in respect of young people, unnecessary because, as the second aspect of this amendment which the noble Lord, Lord Lexden, referred to, makes clear, we know who all the 16 year- olds in the country are. It is not a mystery. They all get a national insurance card. The state thinks that it is important for them to be registered for taxation, but not to be registered to vote. These are fundamental issues, and if we have any role in our constitutional development as a country, we should be drawing them further to the attention of the House of Commons, and we should certainly be putting on the record, as emphatically as we can, that the status quo does not work satisfactorily at the moment.
In the previous two elections, since we have had individual registration playing through, there has been a fundamental underrepresentation of young people, particularly in minority and poorer groups. Also, young people are becoming increasingly politicised because of the scale of the issues affecting them—Brexit, Covid-19 and so on—and as soon as elections come, they suddenly and frantically seek to register. The figures from the Electoral Commission are that in the general election in 2019, 1.4 million young people registered after the calling of the election, and apparently most of the new registrations on 10 of the 15 days with the highest number of new registrations were of young people at that general election.
The Minister might say that this shows that the system is, to some extent, working, but I do not think that it shows that at all. It shows a massive crisis in registration. When young people realise that they are not registered, some, but only a proportion, take the active steps necessary to correct that in that very short window between the calling of the election and the final date for being able to register. This is not a system that is working, it is one that is fundamentally broken, and one where the remedies are very straight- forward. Automatic registration is very straightforward to implement. It could be done immediately and should have been done under this Bill, but the Government rejected it. The further amendment on the paper today, which I absolutely believe that we should carry, would simply draw to the attention of young people that they should be registered.
When there is a fundamental problem of this kind, one does not need to look for the motivation behind it because, in the time that I have been in this House, this is the fourth occasion on which we have addressed the issue of individual registration. It looks very straight- forward and clear to me. Not all members of the Conservative Party, but the electoral advisers of the Conservative Party think they have a direct political interest in voter suppression in general and in the underregistration of young people in particular. Looking at the tactics in this populist movement that has been sweeping the United States and Britain, unfortunately the Prime Minister, who is a representative of it—not as bad as Donald Trump but still pretty bad—is perfectly content to resort to such methods so that fewer young people are registered and vote. On all the evidence, that appears to be the case. This makes me, and, I hope, other noble Lords who take these issues to heart, all the more determined that these issues should be aired, not suppressed, and that we should send this issue back to the House of Commons a second time.
Lord Blencathra (Con)
My Lords, I just popped in today to see this Bill put safety to bed, having participated extensively in Committee and on Report—speaking on it for far too long, noble Lords may wish to shout. I was therefore surprised to see the amendment in the name of the noble Lord, Lord Woolley, and to hear his speech. I congratulate him on a passionate and thorough speech, but one which should have been made at Second Reading. It was a perfect example of a Second Reading speech, and it would also have gone down perfectly well in Committee.
The noble Lord has apologised to the House for coming to the matter late in the day, as he put it, for which he blamed the pandemic. We have all had to change our modus operandi because of the pandemic, but I cannot imagine why, over the past four months, he was unable to participate in any stage of this Bill, online or in the Chamber. While I participated upstairs in Grand Committee, the noble Lord, Lord Tyler, participated from somewhere in the south-west—Devon, I presume—and many other noble Lords participated online. As a new Member, I made mistakes on the procedures, etiquette and courtesies of this House and had to apologise. I know he has apologised today, but the procedure that he has adopted, coming in with this amendment out of the blue at this late stage, is not the right thing to do in this House. I hope that he has not been used as a Trojan horse by the Liberal Democrats, because this has all the smell of a Liberal Democrat ploy. Someone else moves an amendment, the noble Lord has said that he will not vote on it, but it looks as though the Liberal Democrats will force a vote on ping-pong at this stage.
Irrespective of the merits of the arguments and the passionate speech by the noble Lord, Lord Adonis, we should follow the usual customs and courtesies of this House at ping-pong.
Lord Cormack (Con)
My Lords, my noble friend Lord Blencathra makes a very important point, one that was acknowledged in his speech by the noble Lord, Lord Woolley, when he said that he would not be pressing his amendment to a Division. That is right. Reversing that famous quote from TS Eliot’s “Murder in the Cathedral”, he was doing the wrong thing for the right reason, rather than the right thing for the wrong reason. I have great sympathy with him. We should move on with this Bill now, but we cannot escape facing up to the realities of compulsory registration.
Some of your Lordships may recall the phrase, “no taxation without representation”. If you are obliged to have your national insurance number and to pay tax, you should be obliged to be on the electoral register. I would go one step further: I believe in compulsory voting. That does not mean you cannot destroy your ballot paper or write, “A plague on both your houses” on it. I believe it is a civic duty to take part in the electoral process whether by casting or spoiling your vote.
The Deputy Speaker (Lord Duncan of Springbank) (Con)
Are there any noble Lords present who were here at the beginning of this debate who would like to take part at this stage? No? In which case, I return to the list and call the noble Lord, Lord Tyler.
Lord Tyler (LD) [V]
My Lords, before I concentrate on the amendment in the name of the noble Lord, Lord Woolley, I will make some general comments about the Bill. The Government’s response to the improvements made by your Lordships to the Bill, with large majorities, has been profoundly disappointing. However, my disappointment will pale into insignificance when many Conservative MPs discover in a couple of years’ time just how they have been fooled into thinking that their seats will be unaffected by boundary changes. The most careful independent analysis has demonstrated that the Government’s insistence on sticking to the narrow 5% variance in the electoral quota means that some two-thirds of all seats will be changed—all for no real correction of the perceived imbalance. Those MPs will not merely be disappointed; hundreds of Conservative MPs and their constituents will suffer unnecessary disruption. Even more significantly, there will be many blue-on-blue contests for the more winnable new seats in the mid-term of the Parliament, just when the Government is least popular.
As my noble friend Lord Rennard pointed out, Mr Rees-Mogg made no reference to that when, during an inevitably sparsely attended debate, he managed to overturn the improvements passed with large cross-party majorities in your Lordships House. It will be interesting to witness the reaction of his fellow MPs when they realise what he has let them in for. There would be an element of wry amusement for the rest of us if it were not for the avoidable impact on historic, natural and well-established communities. All being well, the political integrity of Cornwall will be protected, but such a desirable outcome will not be guaranteed elsewhere.
This was perhaps the major issue during our debates on the Bill. However, removing some of the other improvements may in due course also be recognised as counterproductive and constitutionally defective. I fear we may live to regret that the House could not endorse the proper concerns expressed by the noble and learned Lord, Lord Thomas, and my noble friend Lord Beith.
I and my colleagues are especially pleased that the noble Lord, Lord Woolley, from the Cross Benches, has tabled his amendment to the Motion on the vital issue of electoral registration. Had this been at a different stage of the Bill, a quartet of senior Members from all parts of the House would have signed it. This is underlined by the strength of supporting speeches on all sides this afternoon. It is particularly appropriate that the noble Lord should lead on this. He has been a powerful champion and campaigner in non-party efforts to get more young people—especially from BAME communities and through Operation Black Vote—to take up their civic responsibilities and rights by registering. He gave evidence on the registration issue to the Select Committee of this House, chaired by our much-missed colleague Lord Shutt of Greetland.
At this point I should say how much I and my noble friends on the Liberal Democrat Benches appreciate the tributes to David from all sides during the Commons debate and again this afternoon in your Lordships’ House. After a lifetime of principled devotion to this cause, his sincerity and clear advocacy of these practical steps towards a more comprehensive democracy shone through during his successful speech on Report.
As the noble Lord, Lord Woolley, and others have emphasised, this modest proposal would give practical effect to the aims to which Ministers have committed themselves. Without this kind of simple administrative adjustment, there is a real danger that the missing millions of unregistered young citizens will remain outside the system.
Ministers have reminded us that registering to vote is a civic duty. Unlike voting, which is entirely voluntary in Britain, co-operating with the registration process is a legal obligation unless the eligible citizen has a specific reason to be exempted. As my noble friend Lord Rennard reminded the House, the register is used to select for jury service. That is an important civic responsibility, which is not entirely voluntary. Failure to co-operate can lead to a fine of £1,000.
This proposal is not a form of automatic registration. Despite the support of the noble Lord, Lord Cormack, it is not on the table for decision today. However, if the Government continue to block sensible ways to maximise registration, it could be argued that they are in a sense condoning law-breaking.
It has been clearly indicated that many of your Lordships on all sides of House wish to support this simple improvement. Therefore, if the noble Lord, Lord Woolley, is not able to move his Motion E1 to propose Amendment 8B in lieu, I should be happy to do so and to seek the opinion of the House at the appropriate moment.
I again pay tribute to all who have helped to ensure that your Lordships’ House has fulfilled its proper scrutiny function. This includes the Minister, the noble Lord, Lord True. As I have said previously, that is the fundamental right and responsibility of this House, not least when MPs and the governing party may need the corrective of relatively dispassionate, non-partisan and independent scrutiny on electoral law. We do not have the same special interests to declare as they have, which could take them into very unfortunate realm of special pleading, as the noble and learned Lord, Lord Thomas, made apparent.
Finally, I put on record on behalf of the Liberal Democrats, particularly all those who have worked on the Bill, our thanks and admiration for all those who have assisted the House, not least our excellent legislation adviser, Sarah Pughe. I thank the two Ministers and their team, the Public Bill Office and other officials of the House, as well as Members from all sides who value the integrity of the democratic process. I add thanks to those academic experts who gave us all such well-researched, non-partisan advice through all stages of the Bill.
Baroness Hayter of Kentish Town (Lab)
My Lords, this has been a useful debate on some important amendments, which were agreed by your Lordships’ House but which, in their complete lack of wisdom, the Government chose to overturn in the Commons—and two of which, rightly, have merited special attention today.
I am grateful to the noble and learned Lord, Lord Thomas of Cwmgiedd, and the noble Lord, Lord Woolley of Woodford, for tabling their counter- propositions. The former made a persuasive and constitutionally important case, to which I will return.
Before doing so, I would like to add my tribute to the late Lord Shutt of Greetland. His contributions on 8 October were, sadly, his last in this Chamber. His untimely death was of course a shock, but it is somehow fitting that that last speech was on expanding voter registration and encouraging people to engage in the democratic process—a cause which, as we have heard, he had championed for years, and one which the Government should take up with more than just warm words. If the future of our democracy is to mean anything, it will be through the full involvement of all our citizens in elections, be they at local, regional or national level.
The noble Lord, Lord Cormack, made reference to “no representation without taxation”. I very gently point out that his party wants to extend representation without taxation by extending the right to vote to people who left this country maybe 40 or 50 years ago and have long since ceased to pay tax. But that is not on the agenda today.
I am saddened, although not surprised, by the Government’s rejection of all five amendments. Far from making the Government’s life difficult, they sought to address genuine concerns in a constructive manner. I particularly regret the lack of a bit of greater tolerance, which would, as the noble Lord, Lord Tyler, said, have helped even Conservative MPs—but it would particularly have helped those who are drawing lines round the valleys and mountains of Wales to have seats that had coherence for the Member seeking to represent them.
However, it is clear that there is not a mood for compromise, regardless of the merit of our arguments. To borrow a famous phrase, you can lead the Minister towards a sensible position but, unfortunately, you cannot make him adopt it—or, at least, not now.
One of the major arguments that we had with the coalition Government, which of course included the Liberal Democrats as well as the Minister’s own party, was over the reduction in the number of MPs from 650 to 600, despite the population having grown and despite almost the same number being put into your Lordships’ unelected House at the same time. We warned the two parties then and we voted against them, but they were determined. So I am delighted that they have now seen the sense of our arguments. Welcome to our viewpoint—and perhaps in due course they will see the good sense behind Amendments 1, 2 and 7.
In particular, given the cogent arguments, and the concern of this House, we had hoped in all sincerity to see some movement on the amendment proposed by the noble and learned Lord, Lord Thomas of Cwmgiedd. Given that Parliament will no longer have any backstop role over boundaries, the independence of commissions —which will no longer be advisory; they will effectively be law-makers—is even more vital. The noble and learned Lord sought to depoliticise, and therefore legitimise, the appointments process.
The Government’s position is a little concerning. It is true that some might be comforted by the departure of certain personnel from No. 10; nevertheless, the only true guarantee of independence is a transparent process guaranteed in law. Indeed, dealing, as we are, with this issue just at this moment, or, in the words of the noble and learned Lord, Lord Thomas, in the times in which we live, when others such as Peter Riddell and the noble Lord, Lord Evans, have questioned how supposedly independent appointments are actually made, a very clear signal in this Motion that no elected politician would have any say would have been warmly welcomed.
Lord True (Con)
My Lords, I thank all noble Lords who have contributed to this debate. My brief rather optimistically said “this short debate”. In fact, it has not been a short debate because it has been an important one. Perhaps at times, as someone said, it has strayed a little closer to Second Reading than consideration of Commons Reasons, but I fully understand the passion and commitment with which all noble Lords have spoken on the amendments they are concerned with, including, of course, the noble Lord, Lord Woolley.
Not to waste time, I turn to the two amendments before us. They are in the names of the noble and learned Lord, Lord Thomas of Cwmgiedd, and the noble Lord, Lord Woolley. As we know, the amendment in lieu tabled by the noble and learned Lord, Lord Thomas, relates to the role of the Lord Chancellor in appointing deputy chairs of the Boundary Commissions and proposes that the Lord Chief Justice appoints them rather than the Lord Chancellor. Some people have expressed concern about the nature of the Lord Chancellor, including the noble Baroness opposite, but I must remind her that it was her party which so sadly removed the Law Lords from your Lordships’ House, to its great detriment. Indeed, that created the nature of the Lord Chancellor about which she complains today. It was a creation at the back of a press release by the Labour Government. This is something that we have to deal with and people with the integrity of my right honourable friend the current Lord Chancellor are seeking to deal with it.
The noble and learned Lord, Lord Thomas, provided us with some questions and I undertook to answer them. However, the noble Lord read out the questions and the answers that we had provided. I shall not go through them all. The record is there in Hansard, but I will repeat that the Lord Chancellor has confirmed that the roles of constituency MP and Lord Chancellor—and indeed any other Minister—are separate and that the Lord Chancellor will always have to act consistently with public law principles in making this or any appointment.
As for whether it is susceptible to legal challenge, as the noble and learned Lord, Lord Thomas of Cwmgiedd, speculated, the Lord Chancellor’s role in making such an appointment is subject to established public law principles and could be challenged by way of judicial review. The noble and learned Lord lamented that. On other occasions I have been urged in this House not to press proposals and propositions that do not allow for judicial review. That is the position and your Lordships must draw your own conclusions.
I was also asked whether it was inconsistent for the Lord Chancellor to have a role in appointments that could involve the selection of one member of the judiciary over another. Indeed, the noble and learned Lord spoke at some length on this question. It is, however, the process currently for the appointment of High Court judges. The reason the Lord Chancellor is still ultimately accountable for senior court appointments is that it was considered sufficiently important for there to be ministerial accountability to that extent. Ultimately, for something so important, ministerial accountability to Parliament is of great importance. The same could be said of these appointments.
The noble and learned Lord referred to a letter that he had received from the Lord Chancellor, part of which he quoted. Perhaps with the authority of a Minister speaking from the Dispatch Box, I can read it out as binding on the Government:
“I would like to assure you”,
wrote the Lord Chancellor,
“that I will commit to the Lord Chancellor formally conducting the Lord Chief Justice on all future appointments.”
My right honourable friend the Lord Chancellor said that he hoped that would provide the noble and learned Lord, Lord Thomas, and the House with the assurance they seek. For that reason, I am pleased to hear that the noble and learned Lord is minded to withdraw his amendment and I hope he will do so.
I return to the amendment tabled by the noble Lord, Lord Woolley. As many noble Lords have said, it is an amendment in lieu to Lord Shutt’s original amendment. I will not repeat what I said about Lord Shutt at the start. I offered that spontaneously and I do not think I can do better than that, so I will not reiterate the fine, warm and justified words from other noble Lords in this debate. However, respect for an individual does not necessarily make a case for making law. Respect for an individual and their life’s work imposes a sense to remember the witness of that individual and to reflect on the things that they said.
My noble friend Lady Scott of Bybrook and the Leader of the House in another place spoke at length in Grand Committee, on Report and in Commons consideration of your Lordships’ amendments. The Government have taken and continue to take action in great detail in this important space of increasing voter registration. Noble Lords who been taking part in these debates will know that I have said that the House will have the opportunity to return to debate electoral issues such as this again when parliamentary time allows. I cannot make any promises, but it is legislation that I hope will come sooner rather than later.
We do not see this amendment as necessary. While the Government agree that the completeness and accuracy of the electoral registers is critical and have set out on numerous occasions the work we are doing, we do not believe that the amendment is necessary. We have introduced online registration, which has made it easier, simpler and faster for people to register to vote. It can take as little as five minutes. We are liberating more time for EROs, on whom the statutory responsibility for maintaining complete and accurate registers lies, to have more time to do their jobs efficiently and effectively, including making changes to the annual canvass. Improvements have been made and will be made in legislation in future Sessions. Scepticism was expressed about that sentiment but it is important to note that recent elections have been run on the largest ever electoral registers.
Although I have not yet had the opportunity to discuss the matter with the noble Lord, Lord Woolley, I told him at a meeting we had on Tuesday—which I greatly appreciated and the Government look forward to working with him in future, as he asked for in his speech—that when a national insurance number is issued, the individual receiving it is informed that they can use the number to register to vote. That happens now. Could this wording be made clearer? I am sure it could. I can confirm that officials are already working with their counterparts across government in DWP and HMRC to see what can be done.
However, I do not believe that this requires a statutory amendment at this late stage; it can be done through non-legislative means. Obviously, the Government will report back on the progress of that consideration: if not, we will no doubt be probed in future electoral registration in this matter. I hope, in answer to the noble Baroness opposite, many of whose remarks towards the end of her speech I agreed with, that it is possible to take this forward through non-statutory means. I hope we will do so, having put that on the record in your Lordships’ House.
I hope we will not have a Division on this. As my noble friends Lord Cormack and Lord Blencathra reminded us, it is not the manner in which your Lordships normally operate at this late stage. I was surprised, therefore, to hear the intervention from the noble Lord, Lord Tyler, who had not had the kindness to inform me, as Minister responsible, that he was proposing to do this—I use the word “kindness” rather than another. I wonder whether the noble Lord had an IT problem when it came to tabling his own amendment. I am not following my noble friend Lord Blencathra’s speculations, but it is interesting that this action is coming from the Liberal Democrat Benches. It is an unusual action in this House to deny permission to a noble Lord wishing to withdraw his amendment. Surely, it is all the more unusual at this very late stage on a new amendment.
The House is facing great difficulties in conducting business in a hybrid way during the coronavirus crisis. It appears that all sides are behaving with great patience and restraint and deserve the highest praise. I believe that this is surely an occasion for restraint. The noble Lord, Lord Woolley, has asked to withdraw his amendment, and in all respect to him, I believe that he should be allowed to do so. The Boundary Commissions, as my noble friend Lord Cormack said, need to start their work; the elected House wishes them to start their work. The last review was delayed by the Liberal Democrat Party, as we know, and I hope it is not going to be a case of “Here we go again.”
I do not believe that there is any reason for further delay and I remind the House that, under the Bill, the review that we in this House and the other place are endorsing will be based on the number of electors, including attainers, on the electoral registers as at 2 March 2020, so it will not be possible for the Boundary Commissions to take into account any changes to registration levels after that date for the purpose of the 2023 review. Therefore, the amendment would, in any case, be ineffective in acting on the review before us. I sincerely hope, in these circumstances, saying as I do that we will give the highest respect, now and in future, to the sentiments expressed by the noble Lord, Lord Woolley, and others, that the noble Lord, Lord Tyler, will not take the exceptional action he proposes in denying permission to withdraw.
Throughout the passage of the Bill, noble Lords from all sides of the House have provided invaluable scrutiny and, in one respect at least, a major improvement through the amendment pressed by my noble friend Lord Young of Cookham. They have provided invaluable scrutiny and expertise, which we will carry forward when we consider electoral legislation in Sessions to come. The Government have listened to that advice and the Bill has been amended, as I said.
While we have not always agreed on the detail, this has been a novel experience for me: it is the first Bill that I have had the opportunity—the honour, I should say—of taking through your Lordships’ House. I thank all noble Lords who have taken part and tabled amendments for the brilliance and, often, the brio with which their arguments have been put. The word “passion” has been used, and I accept that word. In particular, I thank the noble Baroness, Lady Hayter, and the noble Lord, Lord Lennie, and the noble Lord, Lord Wallace of Saltaire, and his team for the constructive and courteous way we have gone about things. It has meant a lot to me personally, and it has been extraordinarily helpful, productive and reflexive in carrying our public debate forward. Like others, of course I thank all the officials involved, and particularly my own Bill team for the prompt service they have given us all.
The legislation will allow the Government to deliver a manifesto commitment to updated and equal parliamentary boundaries to ensure that every vote counts the same. Current boundaries are horribly out of date and there is no time for delay. It is surely time, as my noble friend Lord Cormack wisely urged, that the Bill now passes and the Boundary Commissions will be able to begin their next review without further delay and finally have constituencies that are updated and reflective of the past two decades of demographic change.
“Improving completeness of electoral registers for purposes of boundary reviews
(1) Within a year of this Act coming into force, the Secretary of State must lay before Parliament proposals for improving the completeness of electoral registers for purposes of boundary reviews.
(2) The proposals in subsection (1) may include requirements for the Department for Work and Pensions to notify individuals of the criteria for eligibility to vote and of the process for making an application to join the register when they are issued with a new National Insurance number, and to encourage them to do so.””
Heavy Commercial Vehicles in Kent (No. 1) (Amendment) Order 2020
(4 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Vere of Norbiton
That the draft Order laid before the House on 22 October be approved.
Relevant document: 33rd Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)
My Lords, this package of statutory instruments ensures that traffic can be managed effectively in Kent should there be any disruption on the short straits. This project is called Operation Brock.
As noble Lords will be aware, the Government have been working with partners in Kent to continue to develop Operation Brock during the transition period. Brock is a co-ordinated multi-agency response to cross-channel travel disruption, specifically when capacity for heavy commercial vehicles—HCVs—to leave the UK through the port of Dover or the Channel Tunnel is significantly restricted. We are prepared to use Brock should cross-channel disruption occur due to the UK’s departure from the EU at the end of the transition period, although it could also be deployed as a result of disruption relating to bad weather or industrial action. These three orders are a vital part of Operation Brock, as they will significantly expand and strengthen the enforcement regime that underpins it.
The first SI—the (No. 1) (Amendment) order—will see the extension of the sunset clause in the Heavy Commercial Vehicles in Kent (No. 1) Order 2019 to 31 October 2021. To give some history: the Heavy Commercial Vehicles in Kent (No. 1) Order 2019 provides powers to direct drivers to proceed to a motorway, removing the vehicle from the local road network, and powers to direct drivers not to proceed to the Channel Tunnel or the port of Dover except via a specified route or road.
The (No. 1) order 2019 also sets out the amount of the financial penalty deposit for offences relating to Operation Brock, and it may be helpful if I briefly explain the roadside enforcement regime. A driver with a UK address who commits a road traffic offence can be issued with a fixed penalty notice, which can be paid immediately or within 28 days. However, if a driver does not have a UK address and could avoid that follow-up enforcement action, the police or the Driver and Vehicle Standards Agency can require the immediate payment of a financial penalty deposit. If a driver cannot pay the deposit, their vehicle can be immobilised. This regime is used for many road traffic offences and ensures that penalties are paid. The deposit for breaching the traffic restrictions included in the other two 2019 orders as amended, and for failing to comply with a traffic officer exercising the (No. 1) order 2019 powers, is set at £300. The fixed penalty notice amount is also set at £300 by the (No. 3) (Amendment) order 2020.
The (No. 2) (Amendment) order is a “made affirmative” order that will extend to 31 October 2021 the sunset clause of the Heavy Commercial Vehicles in Kent Order (No. 2) 2019, which prohibits cross-channel HCVs from using local roads in Kent other than those on the approved Operation Brock routes. To facilitate traffic flow, the legislation also requires cross-channel HCVs to remain in the nearside or left-hand lane when using those parts of the Operation Brock routes that are dual carriageway local roads. Appropriate exceptions to this prohibition have been provided after consultation with the Kent Resilience Forum and freight associations.
Finally, the (No. 3) (Amendment) order has been laid using the negative procedure. This order extends the sunset clause of the Heavy Commercial Vehicles in Kent Order (No. 3) 2019 to the same date as the others, so they will all expire on 31 October 2021.
The amending order further defines the strategic roads which will require HCV drivers to obtain a Kent access permit through the GOV.UK “Check an HGV is ready to cross the border” service before setting off on an international journey via Kent. This amending order would also allow vehicles carrying specific priority goods to obtain a priority goods permit that allows them to bypass the Operation Brock queues. It also clarifies to whom local haulier permits may be issued in line with Kent County Council guidelines.
To summarise, these amending instruments continue the powers from the 2019 orders by extending the sunset clause. These instruments allow for an enforceable border readiness check to be conducted. At the end of the transition period, the UK will become a third country and the customs authorities in EU member states will introduce EU border and customs rules. Traders will need to complete new processes for customs and provide documentation to their hauliers, who will need that documentation when carrying goods, to enable smooth movement across the border. The border readiness checks will look to see whether a haulier has those documents. This is important because, without the right documentation, drivers may not be able to complete their journey to the EU. The UK port may turn them away if they do not have the required documentation—for example, some of the customs documentation will need to be scanned at the Eurotunnel check-in before the vehicle can board the train.
These orders are vital to sensible traffic management in Kent. It is critical that we demonstrate to the public and to businesses that Operation Brock has been developed and strengthened from the 2019 orders and that it will be ready, fully operational and enforceable on day one should it be needed to deal with the impact of any cross-channel disruption. I beg to move.
Lord Whitty (Lab) [V]
My Lords, I thank the Minister for her words. She made it sound as if these amending orders were a relatively straightforward way of dealing with the post-Brexit situation but, taken together with everything else we know, it conjures up something closer to a hard border in Kent than the free, frictionless trade we were promised after Brexit.
I have four areas to raise with the Minister but, when she winds up, can she first indicate whether any of this is likely to be included in any trade agreements that might be reached within the next few days? Rumour is that there is a specific sub-agreement on road haulage that might make life a bit easier than what she has described when Operation Brock would be needed.
The first point I want to raise is on guidance. Over the weekend, I tried to read the Government’s 24-page guidance for hauliers and commercial drivers. It is not an easy read or particularly user-friendly, but it is better than the 262-page document they issued the previous month. However, it is not comprehensible at a glance. What efforts have the Government made to ensure that information is communicated to haulage offices and to individual drivers, who themselves may be of multiple nationalities, in a form that is easily comprehensible? What is surely needed here at this late stage is a user-friendly handbook, plus perhaps an electronic equivalent. Can the Minister report on discussions with the industry and the trade unions on a short, easy-to-read guide for hauliers and drivers to understand?
Secondly, on the related point of enforcement, failure to produce correct documents will fall on individual drivers who may have their vehicles demobilised or turned back, and who may themselves be fined £300, as the Minister explained. My point is that the penalty should surely fall on the company, which has the legal responsibility for documentation, not on individual drivers. It is surely wrong to penalise the worker or subcontracted driver for the failures of the haulier’s administration. Has any discussion on this arrangement involved the trade unions representing drivers? I understand that the Minister’s colleague, Rachel Maclean, told some of our colleagues that she would meet Unite the Union but that, as of this morning, no such meeting has yet been arranged.
The majority of drivers employed by foreign and British hauliers operating on the cross-channel routes are not British nationals; many are, of course, eastern European. There is a difficulty not only of communication but, potentially, of collecting any fine if it falls on the driver and not the company. There is another problem here as well. There will be a need to differentiate drivers and trucks of different nationalities. I understand that there will be an electronic system, which is not completely working properly. It will be able to do so to a degree, but what then happens? For example, trade between Ireland and the remaining countries in the EU mainly transits via Great Britain, but Irish lorries from an EU member state—Ireland—will presumably have easier access through French and Belgian ports, so should the UK side of this operation not allow them to go through more easily? What arrangements have been made for this Irish trade? Will it be given priority, as would logically be the case? While I am about the Irish trade, what are the equivalent arrangements at Holyhead and Fishguard?
Regarding Operation Brock, traffic management and parking, these regulations imply an enormous operation. They envisage situations where the traffic is either near static or gridlocked. Does responsibility for enforcement and Operation Brock, with traffic management on the M2, M20 and feeder roads, fall on the Kent Police or some new organisation? I understand that document checks will be carried out by DVSA personnel. Is the cost of all this to come out of general taxation or a grant to DVSA, Kent County Council or Kent Police? Does the operation involve customs officers and Border Force staff in checking other aspects of the documentation? What are the additional cost and manpower resources for that operation? It is potentially an enormously substantial traffic management task.
Moreover, how will local commercial traffic which operates only within Kent and south-east England—not in international trade at all—be allowed to proceed and not get caught up in the gridlock of international trade? How, for example, will those lorries given key priority because they are carrying live animals or fresh produce be able to work their way through and who is responsible for seeing that they do? Is that the police or the DVSA, and how will they have the authority to get them through?
Are there systems for communicating severe delays back upstream, so that lorry drivers coming through the country either divert or rest well before they reach Kent, so that the situation does not get worse? I understand that hauliers and Unite the Union have also raised the question of facilities at the lorry parks, where drivers may have to stay for hours, if not days, in some cases, if the situation gets really bad. Frankly, a few Portaloos scattered along the M20 is not sufficient.
Finally, can the Minister clarify something on phasing in? In dealing with traffic coming the other way, into the UK, the Government have indicated that they do not initially intend to impose heavy checks at Dover and that the system will be phased in in five stages. Is there a similar understanding with the EU, or with the French and Belgian authorities, so that there will be a phasing-in of their controls the other side of the channel? If that were the case, it would ease the problem on this side to a degree and much in these orders would therefore not often be needed.
Lord Bradshaw (LD) [V]
My Lords, building on what the noble Lord, Lord Whitty, has said, a large number of drivers involved in international haulage working for either British or continental companies are saying that if the arrangements in this country for their conduct through it are too onerous, they will opt not to come to Britain and seek work elsewhere. If that is to be the case, it will lead to a crisis in the haulage industry. Drivers will obviously not travel here from Spain with fruit, for example, if they are to be heavily delayed because that will far outweigh the earnings which they would get.
I hope that the Minister will think about the use of traffic officers to enforce very carefully. I remember that when PCSOs were introduced into the police force there was a lot of argument about what powers they had. Bearing in mind the reluctance of government to allocate enough police to roads anywhere, it seems time that the Government faced up to the question of how much power will be given to officers, particularly if they are to undertake duties as envisaged in these instruments.
My major point, and I have told the Minister of this, is that I believe we are in danger of having, virtually, a hygiene crisis along the whole of the routes in and out of the ports. There is already a problem in Kent with a lot of human waste. It is a lot of trouble. Haulage firms have never provided adequate facilities for drivers, as is the case in most other industries, but it is important that these issues are faced. The noble Lord, Lord Whitty, referred to a few Portaloos strewn here and there along the motorways. It is a much more serious problem than that. These people have to be able not only to use the loo but to wash, eat and sleep. The proper facilities will need to be provided, unless the arrangements with the EU are much easier than we believe.
The noble Lord, Lord Whitty, referred to some part of the agreement which might make things easier, but it is a very fragile arrangement which depends on timely arrivals of vehicles at points of departure and their swift clearance away from points of arrival. Unless that is met, after Christmas the Government will be faced with an almighty crisis, which they are going to have to deal with.
Lord Pendry (Lab)
My Lords, I wish to declare a kind of interest in this debate. I am a resident of the Isle of Thanet in the county of Kent, and as such have an interest in some of these important issues, especially those before the House today: the commercial and environmental aspects that impinge on the county of my birth—St Peter’s, Broadstairs, to be exact. Some noble Lords will have other, very meaningful reasons for entering this debate, and I look forward to hearing those and, indeed, the Minister’s reply to this short debate. As a remainer, I would have hoped that the instruments before us were unnecessary—although there have been traffic problems surrounding the outskirts of Dover for as long as I can remember—but we are where we are.
In this short debate I wish to dwell on the amount of money that has been expended in such a prolific way, reflecting the level of stupidity, when taking these three instruments together, mindful of the fact that no doubt the problems envisaged may never take place at all. I wish to dwell on that narrow yet important part of the instruments before us today. In that regard, I recently asked some Parliamentary Questions of the Minister sitting on the Government Bench today. I was concerned about the costs to the taxpayer that have already been expended in relation to the Manston Airport project. As an aside, I am sure everyone here will know that Manston Airport is the largest airstrip in the country and played a great part in the Battle of Britain in the Second World War.
The Answers to the Questions that I put to the Minister concerning the Manston Airport project were that
“between August 2015 to June 2020, the Department for Transport (DfT) has paid a total of £19.4m for the use of Manston Airfield as a lorry park”—
it might be of interest to noble Lords that not one lorry has been parked at Manston during that period—and that some £10.3 million has been expended
“as part of the EU Exit no deal preparation contingency planning and £9.1m for the use of Manston Airfield for business as usual”,
whatever that means,
“and Operation Stack. This has enabled DfT to use Manston Airfield to hold HGVs for traffic management purposes”
in the event of a dispute. Yes, Minister, the money spent is of concern, but imagine the net effect on the villages of Manston, Minster and Monkton, and the surrounding areas, of what they have had to put up with for over a year. What the Minister’s department refers to as a temporary backup holding lorry facility causes disruption not only to the villages mentioned but to traffic generally. The department described the measure as temporary—needed for a period of six months based on current planning, it was said—when in fact it has been going on for some 18 months.
That is not the end of the disruptions taking place for those people: there is also the extra cost of flood- lighting, security and road diggers, while the entire airfield has been covered in cones for months for no obvious reason. For those reasons, I hope the Minister will respond and give some very good explanations for why so much money has been expended unnecessarily on these projects.
Lord Bourne of Aberystwyth (Con) [V]
My Lords, it is a great pleasure to follow the noble Lord, Lord Pendry, who obviously knows what he is talking about and speaks with great local knowledge.
I thank my noble friend for setting out these orders so clearly, but they raise concerns. In effect, they extend the sunset provisions from the end of this year to the end of October 2021. I have various questions for my noble friend based on the Explanatory Memoranda for the orders. First, the orders refer to a position where in January it seems about 60% of the normal flow will be unimpeded—the memorandum states that that is about 6,500 vehicles—but that rises to 7,000 in February 2021. I wonder why it rises; is that because of increased usage in February?
Nothing is said beyond February 2021, but the sunset provision lasts until October. Is it anticipated that this will continue until October, and is there any assessment of what its impact is likely to be thereafter? Presumably, if it is extending until October 2021, there must be an anticipation of delays throughout that time. The orders talk of a risk of some additional friction at the border, at least initially. I appreciate that, but it seems to be quite some friction if it is going on for nine months plus—10 months, in fact.
I want to ask my noble friend about local involvement. It is to be welcomed that the Kent Resilience Forum is central to the implementation of the orders, but I wonder how it is being engaged. How often does it meet the ministerial team? When was the last time they met so that some of the forum’s local knowledge could be made use of and the ministerial team was made truly aware of the impact that this is going to have in Kent?
With regard to the implementation locally of Operation Brock, how many staff have been recruited, what training has been put in place for them and, importantly, who is paying for those staff? Like the noble Lord, Lord Whitty, and others, I am concerned about the lavatory and washing facilities that are going to be made available. It is so important that we have proper hygiene facilities. As can be appreciated at the moment, this is something that everyone is rightly going to be concerned about. Could my noble friend expand on what proper facilities are being provided for the 6,500 vehicle drivers anticipated in January and the 7,000 anticipated in February?
It is not just washing and lavatory facilities that are important, important though they are; what about food outlets and so on? I also wonder, given the importance of having the appropriate paperwork, if there is going to be internet access, whether at Manston airfield or anywhere else. If my noble friend could say something about that, it would be appreciated because that point is central.
Are there any special considerations in the Covid pandemic period that have been brought to bear? Obviously, when this was first considered in terms of an earlier possible delay to a Brexit agreement, there was no pandemic. There has been a pandemic since. How has that been factored in? Is the prospect of all those people in close proximity presenting particular problems? How are we addressing that?
Like the noble Lord, Lord Whitty, I am concerned about the position regarding Holyhead and Fishguard. I appreciate that is not directly an issue here but I wonder whether my noble friend can say something by way of reassurance that we are on top of that issue. I know this point came up yesterday at Oral Questions, at least with regard to Holyhead, and it appears that there are some difficulties there too, although perhaps not of the same magnitude. Perhaps she can say something about that.
These orders appear to be specific to Kent. I understand that, but given the impact that all this is having, are we sure that it will not have an impact on the surrounding counties of Essex, Sussex and Surrey, and the capital, London, as well? If not, what are we doing about the position in the adjoining counties and areas? Are we ensuring that there is proper publicity in the surrounding areas—indeed, throughout the country—so that people travelling to Kent will be aware of the problems involved in doing so, particularly close to Dover, Ashford and so on? There are many considerations, and I appreciate that my noble friend might not have answers to all the questions. If she does not, I shall be happy to receive a letter from her, with a copy placed in the Library.
Lord Snape (Lab)
I am grateful to the Minister for introducing the orders. However, she did so somewhat blithely, as if these were a couple of routine matters that could swiftly be disposed of—whereas, as my noble friend Lord Pendry outlined, we are talking about events that will have an enormous impact on the county of Kent and elsewhere.
There are also some radical departures from what has been accepted as normal policing in the United Kingdom. I refer the Minister to the explanatory memorandum issued with the orders, and especially to paragraph 6.1, which mentions
“a financial penalty deposit of £300 to be taken immediately at the roadside from a person without a United Kingdom address who is believed to have committed the offence of contravening the new restrictions”.
This is a vast departure from our normal procedure. The Police Federation has for many years been emphatic about the police’s desire not to be seen as fine collectors on behalf of Her Majesty’s Government. I wonder what conversations have taken place with the federation about these proposals. Can the Minister tell us whether there are any other motoring offences that involve the police habitually stopping motorists at the roadside and given them on-the-spot fines? I know that happens in other parts of the world, but it does not happen in the United Kingdom.
Three hundred pounds is a not insubstantial sum. How many lorry drivers drive around the United Kingdom with £300 in their back pocket? Maybe there will be other arrangements. Will Visa be acceptable, or perhaps PayPal? Will people have to use a mobile phone to arrange a transfer from a bank account? Have these proposals, and their impact on the ground, been thought through?
Who will administer all this? The noble Lord, Lord Bourne, spoke about the number of heavy goods vehicles that could be involved under the orders, but when I looked online, the Kent road police unit appeared to consist of about 100 officers. Are they to be deployed entirely on Operation Brock, or are they still expected to carry out their other duties? Has the police and crime commissioner for Kent been consulted about the deployment of the police in this way? The Explanatory Memorandum mentions 5,000 or 6,000 lorries. That will be no small task for police documentation checks. Traffic officers are specifically mentioned in the Explanatory Memorandum, but this is difficult to envisage with only 100 traffic officers. If they are to be deployed entirely on Operation Brock checks, what will happen to road policing generally in that part of the United Kingdom?
The documentation issue was barely mentioned. The Government have talked about recruiting 50,000 extra customs officers to deal with the documents. Perhaps the Minister can tell us how many of those customs officers have actually been recruited, as we come to finally leaving the European Union.
Her Majesty’s Government are supposed to be producing a driver’s explanatory handbook to explain all these regulations to drivers. It is going to be in 18 languages. So far, we have not even seen one in English; I cannot speak about the other 17. Can the Minister tell us when this handbook is to be produced, bearing in mind that we are only a few weeks away from its being necessary?
The Road Haulage Association—the very people most involved in these matters—has been fairly scathing about the Government’s preparatory work in the run-up to 31 December, recently describing the proposals as “incomplete” and “inadequate”, and using terms such as “total incompetence”. Those are the RHA’s words, not mine. It is not exactly thrilled by the prospect. Have the trade unions—especially Unite, which is responsible for the organisation of lorry drivers in the United Kingdom—expressed an opinion? What are their views about the proposals?
The figure of 5,000 to 7,500 lorries has been mentioned. If I may digress a moment from the actual orders, while remaining on the subject of cross-channel traffic, I can tell noble Lords that 30 years ago, those of us who supported the Channel Tunnel were assured that one of its enormous benefits would be that, for the first time in this small country, there would be the opportunity for long rail freight hauls right across Europe. Many of us looked forward to seeing those trans-European freight trains. But now, 25 years after the tunnel opened, when 1.2 million lorries per year use the Eurotunnel railway merely as a shuttle to get between our country and the continent, how many freight trains are scheduled every 24 hours? Six. There is a slight imbalance there, and given the likely chaos foreseen not just by me but by lots of other people, I hope the Minister and her department will look again at that imbalance between international road and rail freight, and see what can be done.
Funnily enough, the ports of Dover and Folkestone, and many other affected parts of the United Kingdom, were the areas that voted most heavily for Brexit in the referendum. They may find that “getting their country back” means that their county is likely to be choked by a torrent of heavy goods vehicles going nowhere, and their areas will be considerably affected by the carbon deposits that the vehicles will leave. Pollution and congestion could well be the outcome of these two orders.
Baroness Altmann (Con) [V]
My Lords, it is a pleasure to follow the noble Lord, Lord Snape, and I thank my noble friend the Minister for setting out the orders so clearly. I welcome these SIs, and the pragmatic decision to extend the time-limited regulations for a further nine months, especially because there is no clarity at all on our future EU trading relationship from next month onwards, and because of the disruption we have seen over the past few months due to the pandemic. It is inevitable that we must prepare for chaos at our ports from 1 January 2021.
My noble friend suggests that the orders may not, in fact, be needed—but I must confess that I cannot share her confidence. Whatever the outcome of the trade talks, customs declarations will be required for all British-EU trade. Even if we waive rules for the first six months, we cannot know whether the EU will do the same. If drivers do not have the correct import-export documents or customs declarations, they could be fined, and have their cargos seized or even destroyed. These SIs rightly aim to deal with the logistical consequences of the delays that this might cause at the ports and the Channel Tunnel when drivers are in Kent.
Following the traffic chaos that we have seen during 2020 as a result of hold-ups for various reasons at ports on the other side of the channel, these SIs will ensure that Operation Brock traffic controls will be extended. They also introduce some modifications. I welcome the introduction of special fast-track procedures for perishable goods, but I am more concerned about the Kent access permit for heavy commercial vehicles, to allow them to use the A2/M2 or the M20 to get to the Channel Tunnel terminal in Cheriton, or to the Port of Dover. The noble Lord, Lord Whitty, mentioned the threat of £300 fines for those who travel on local roads without a permit. I agree with him that the fine should surely be levied on the company rather than the individual driver.
All of this is certainly not what was promised when Brexit was proposed to the people of this country. Far worse than this, it is now four years since that referendum and a little over four weeks until the transition period ends, yet we are told that much of the detail that operators need for effective planning is not yet complete. I ask my noble friend what the reason for this is and how it is being considered in the current EU negotiations.
These regulations are certainly going to be required according to those directly involved. For example, the operations director of the Customs Clearance Consortium suggested that there was
“more than a 50% chance there will be delays”
on Kent roads as a result of the disruption at the ports. Earlier this month, the Commons Committee on the Future Relationship with the European Union was told by road haulage leaders that there is an 80% chance of “chaos in Kent”, as the necessary computer systems, lorry parks and customs agent needed to avoid delays were not yet in place.
I was struck by the observation that Ministers seemed to be relying on
“self-belief in their own rhetoric … that everything will be okay”.
Could my noble friend please comment on, for example, remarks by the chief executive of the Road Haulage Association that far fewer than the 50,000 customs agents needed to process the 200 million additional forms generated annually by Brexit are already in place? How many agents does her department estimate are, in fact, in place? If she does not have this, and the other, information I am asking for, please could she write to me? When will the full functionality of the IT systems needed for efficient post-Brexit operations be provided? Do the Government have information on the availability of the heat-treated pallets, which are apparently in short supply but are essential for exports to the EU from January?
I express particular concerns about smaller hauliers, which have limited resources for preparations of this magnitude. Like the noble Lord, Lord Whitty, I also tried to look up the Government’s guidance and found it difficult to identify precisely what is needed to ensure readiness. The officials preparing such documentation clearly have a much greater knowledge than those who have never had to deal with customs before because of our free movement rules within the single market and customs union. The Government have always faced significant challenges in communicating policy to the public, struggling to provide user-friendly information.
Once again, I echo the words of the noble Lord, Lord Snape, asking: when will this business handbook that was promised to help hauliers prepare for the radical new systems be in place? The idea that there will now potentially have to be passport-style checks just to get into Kent, and of then having to go through those checks and potentially still queue in giant lorry-holding facilities, is rather shocking. I echo the concerns of my noble friend Lord Bourne and others, and I ask my noble friend what restroom facilities will be available for drivers with delays of many hours. I know that we were told that Brexit would mean an end to free movement, but I do not think anyone ever imagined that that would mean ending free movement inside our own country as well.
Lord Berkeley (Lab) [V]
My Lords, I am grateful for the opportunity to speak in this short debate, and I congratulate the Minister on at least updating previous documentation and giving us a sight of what will be needed for the next six months or, probably, a year. It is all highly complex, as other noble Lords have said. I declare an interest as a member of the EU Goods Sub- Committee. We have taken evidence from many of the people involved in this flow issue over the last two or three weeks, including Unite the Union and many of the business groups whose members get involved in it.
The situation is really serious, from what I understand. I shall not repeat what other noble Lords have said, but I hope we will get a comprehensive response from the Minister when she winds up—or at least she could, perhaps, write to us afterwards. I have always thought that one of our problems is that we spend a lot of time talking—quite rightly—about what is going to happen in Kent, but very little time talking about what is happening on the other side of the channel. That is before we even get to the Northern Ireland/Republic of Ireland situation.
We recently took evidence from the Port of Rotterdam and the Port of Calais. They were very polite about us, as you would expect, but I got the distinct impression from the representative of the Port of Rotterdam that they thought that everything on their side of the water would be all right, but they did not have much of a clue about what will happen on our side. The message they were getting from their colleagues was that the situation was—shall we say—confused. They probably would have been rather ruder if they had not been giving evidence to our committee.
On that issue, perhaps the Minister could explain the location of the controls between Dover and Calais. This applies to trucks going in both directions. We have heard that the French immigration—or emigration—people will deal with the drivers’ DIT work before they get onto the ferry. However, we then heard that, in fact, the French customs and immigration people would deal with incoming freight at Dover. As the Port of Dover told us, there is no room there—that is a minor detail. We need to know where all the different controls will take place and in both directions. That applies if and when Manston and Sevington and all the other places come into force, because of traffic jams. On the Calais side, there is much more space, but I would like to know where every control is taking place there.
This leads me on to a subject on which many noble Lords have spoken: the location of restrooms—some people call them restrooms; I call them toilets. Where will they be? Again, we got some rather sad evidence from Highways England, which is responsible for motorways in Kent. It is good to know that there will be portakabins and good facilities in Sevington and Manston, but the problem is that, going down the motorway, there are four lanes on the M20 and there might be a situation where there are two lanes in one direction and two lanes in the other, but it is difficult to know where you could put even a portaloo down there. You cannot really put them on the verge, because people will stop on the hard shoulder and, when they are moving, that is highly dangerous. Of course, once they have stopped and there is a traffic jam that lasts for goodness knows how many hours, where will the facilities be? It is very hard to solve, unless portakabins are to be airlifted in, which sounds pretty stupid. We need some answers
My second question for the Minister is about enforcement, mentioned by my noble friend Lord Snape. When stopping a truck, or even going up to a stopped truck, and dealing with the kind of fines mentioned by my noble friend—the £300 and everything—the first question is: who is liable to pay it? Is it the driver? Is it the forwarder? Is it the owner of the goods, the owner of the tractor unit or the owner of the trailer? All of these could well be different people. How long does it take a police officer to administer a fine or a charge? As my noble friend said, £300 is a lot of money. Where are they going to stop the trucks to do it? I do not know whether the Minister has an answer to this question, but I suspect that the answer is that this will not be done—they cannot do it because they do not have enough people. Then, we will get into a really chaotic situation.
I echo previous noble Lords in saying that we have known about this for four years. We had hoped that the single market would allow a freer flow of goods, but there were going to have to be some checks somewhere. There will be checks not just at Dover and the Channel Tunnel but at ports all the way up and down the country, to which drivers may well want to divert to avoid reported jams at Dover and the Channel Tunnel. Are we in a situation where we are going to get chaos everywhere? If so, it is we and our businesses who will lose out.
From having talked to many of the firms involved, I know that, in spite of the fact that we may have 80% of the drivers and trucks coming from eastern Europe and being driven for eastern European companies, if they get held up too much, none of the people or customers will want to try that again. As a consequence, the big and small firms that use these services to move their goods across borders several times in the course of manufacture may well say, “Enough’s enough, we’re going to move it all to the continent”. I hope that I am wrong, but we have to get this right, and at the moment the industry clearly does not think that we have. I look forward to the Minister’s response.
Baroness Wheatcroft (Non-Afl) [V]
My Lords, it is a pleasure to follow the noble Lord, Lord Berkeley, who asked some very pertinent questions.
I thank the Minister for introducing these statutory instruments, which are clearly necessary. She explained them clearly; nevertheless, they will not ease the concerns of the nation’s hauliers, who are still in doubt about what their position will be at the end of the year. Can the Minister tell them, for instance, whether they will need ECMT documentation? If so, we have a major problem, since only a fraction of our hauliers would be able to collect such documentation.
Other noble Lords have spoken about the problems that we will have under these arrangements and the new proposals. I have grave concerns about the impact that all this will have on Kent, a county once renowned as the garden of England. I declare an interest: I have a house on the Kent coast. I am therefore very familiar with the weight of freight traffic, which pounds up and down Kent’s road network.
Operation Fennel is the Government’s plan to provide —[Inaudible]—for up to 7,000 lorries in the event of delays at the Channel Tunnel and the Port of Dover. More than—[Inaudible]—4,000 provided at what was Manston Airport. The noble Lords who referred to hygiene are absolutely right. The prospect that, very soon, 8,000 drivers could be cooped together in cramped conditions, inevitably mixing with each other, is nothing less than horrifying. A Covid outbreak would be almost certain. Can the Minister say how drivers displaying symptoms would isolate? This would be in a district—Thanet—with the second-highest Covid rate in England. Thanet District Council’s director of operational services said:
“An outbreak at Manston would have a significant impact on already stretched services.”
Equally, an outbreak at Sevington, where up to 3,400 drivers could be held, could cause—[Inaudible.] The nearest hospital, the William Harvey Hospital at Ashford, is already under strain. But Manston has many other—[Inaudible.] The A229, a road with no hard shoulder, and other nearby roads are likely to become log-jammed, blocking the road network around both Margate and Ashford hospitals.
But it is not just hospitals that cause a problem. If there is a fire in the area, emergency services could find it almost impossible to get through, given that the planned parking lanes leave little leeway for them to pass. Thanet’s council leader has said that a lack of information from the Government on vital issues such as traffic flow proposals is seriously hampering the council’s ability to plan how to mitigate the effects on residents. As recently as Tuesday, the council was still waiting for key information, such as an assessment of the traffic movement in the area, analysis of key environmental impacts and comprehensive operational management plans for the lorry parks. Do the Government realise the dangers they risk imposing on east Kent?
Already there have been months of delays on the M20 as—[Inaudible]—parking lanes were put up, taken down, and have now been put up again. I do not understand why they were taken down, as at that stage we did not have a trade deal. Surely putting them up once and leaving them there would have been a more sensible and economical decision. The area is now being defaced by the creation—without any public consultation —of a monstrously ugly visible lorry park at Sevington.
The Government seem very loath—[Inaudible]—the people of Kent. Recently, they turned the Shorncliffe army camp into a camp for migrants who—[Inaudible]—crossed the channel. The local council handled the issue rather more sensitively than the Government, and the local—[Inaudible]—welcomed the newcomers. Nevertheless, the lack of consultation is a real cause for concern. Now, without consultation, the area faces the prospect of many thousands of drivers, from all over the UK and Europe, being stranded in cramped, risky and potentially insanitary conditions in an area in which Covid is already rampant. So what alternative plans do the Government have to ameliorate this potentially dire situation? In the event of a Covid outbreak in one of these lorry parks, how would the Government react?
The Deputy Speaker (Lord Faulkner of Worcester) (Lab)
My Lords, the noble Lord, Lord Foulkes of Cumnock, has withdrawn, so I call the noble Baroness, Lady Randerson.
Baroness Randerson (LD) [V]
My Lords, once again we are updating SIs that we dealt with last year. It is worth remembering that at that time the concept of lorry drivers needing a Kent passport was shocking, and that when the Minister was asked whether the timing of the sunset clause was sufficient, we were strongly reassured that it was generous. The first of these SIs extends the sunset clause from 31 December this year to 31 October 2021, so I ask the Minister again if she is convinced that this new date will be long enough. Are the Government convinced that they will not need Operation Brock after next October?
I am comparing the situation in Kent with the crisis the Government are facing in providing lorry parking for Holyhead. It was clear from an Answer given yesterday to a Question that there is no hope of a lorry park near Holyhead being up and running before July. In the meantime, customs clearance processes will take place in Warrington and Birmingham, over 100 miles from the port. This is obviously an open invitation for all manner of evasion of export and import controls. I echo the concerns of the noble Lord, Lord Bourne, about the serious disruption in north Wales, although the Reasonable Worst Case Scenario the Government produced seemed to dismiss this entirely.
In September, the Cabinet Office issued a Reasonable Worst Case Scenario for Borders at the End of the Transition Period, as I have just said. That estimated that 30% to 50% of trucks might not be border ready on 1 January and that this would lead to daily queues of 7,000 HGVs in Kent by February. I am assuming that we are now in that worst-case scenario, as we are 36 days away from the end of the transition and there is no deal. We had a taste of this earlier this week when the French border authorities trialled the new passport checks that will be required and five-mile queues of lorries developed on the M20.
So freight operators are being told to prepare for the change, and their very loud response is to ask exactly what kind of change they are supposed to prepare for. A spokesperson for Logistics UK has quite reasonably pointed out that the Government’s own hauliers’ handbook is incomplete, and press reports suggest it is pretty incomprehensible. As a large percentage of the hauliers crossing via the channel ports are not British, if it is to work, it also needs translation. Do the Government intend to translate the handbook, and when do they expect it to be ready? I am conscious that I have also asked this as a Written Question but I had not received a reply by the start of the debate. I apologise if I have received a reply since it started.
Like the noble Baroness, Lady Altmann, I will take this opportunity to ask about the state of preparedness of the government IT systems for the new border controls and what progress has been made on recruiting the additional staff required. How near the target are the Government?
These orders make some additional amendments to the 2019 orders as well. They modify the approved routes that an HCV can take to the ports and require them to have a Kent access permit when using the local road network. That is understandable as communities in Kent have suffered considerable disruption and inconvenience in the past when there have been short-term problems. The disruption we are discussing here will probably last for some months, of course, and it could possibly be semi-permanent. It will certainly cause supply problems, as an HCV held up on the journey out will almost certainly be delayed on its return, along with its load. So it is regrettable that this is all so close to the wire.
There is an additional specific exception in the Heavy Commercial Vehicles in Kent (No. 3) (Amendment) Order 2020, which goes along with these two, allowing hauliers from east Kent and Faversham to use local roads. Was this the only request for such an exception? As I said when we discussed this issue before, there are bound to be hold-ups for other local commercial traffic simply trying to go about its daily business in Kent.
Retailers and hauliers are particularly concerned about perishable goods, so these orders allow priority to hauliers carrying highly perishable goods, live animals and goods which
“would give rise to a disproportionate economic impact on a geographical area of the UK.”
The first two are clear but I wonder whether the Minister can help me with the very strange phraseology of the third exception. It strikes me that this could apply to a very large proportion of lorries. What about steel from south Wales or tinned peas from Lincolnshire? Each of those is very important to the local economy. Forgive me for being sceptical, but this sounds like a last-minute addition put in by a Minister to help a friend.
There is to be a prioritisation site at Ebbsfleet. Can the Minister tell us exactly how that will work? I am concerned that the criterion is that a lorry has to be carrying a single load of fresh or live seafood. Surely the issues about freshness and welfare of animals apply just the same if you have other items in your load as well?
The big pharmaceutical companies are concerned that supplies of medicines and vaccines could well be interrupted and delayed. Can the Minister explain why are they not included as a priority category? The Government apparently do not hold strategic food reserves. Can the Minister tell us what discussions the Department for Transport has had with other departments about shortages of strategic supplies and how they might be minimised?
Finally, I take issue with the Explanatory Memorandum’s impact assessment, which must surely go down in history as stretching credibility until it snaps. It says:
“There is no significant, lasting impact on business … the Check an HGV service will have a limited burden on industry once familiarised”.
That refers to a required set of documentation that will, according to Sainsbury’s, cost thousands of pounds per load. It continues:
“There is no … significant … impact on the public sector.”
Tell that to the police or the NHS or the local councils concerned—
Baroness Penn (Con)
I am sorry, I have to remind the noble Baroness of the time limit for contributions in this debate.
Lord Rosser (Lab)
My Lords, the orders extend the sunset clauses of existing 2019 orders, as the Minister said, from the end of this year so that heavy commercial vehicles can continue to be regulated by traffic officers in Kent until the end of October next year. That is to keep Operation Brock, which is intended in particular to keep the M20 in Kent open in both directions, on the road in a bid to avoid the consequences of cross-channel travel disruption. The orders also provide for penalties for drivers of heavy commercial vehicles who do not have a valid Kent access permit, and for heavy commercial vehicles carrying priority goods via the Channel Tunnel or the Port of Dover to be given priority when travelling through Kent.
Since we are only just over a month away from the end of the transition period, could the Minister place on record the Government’s latest assessment of the likely level of cross-channel travel disruption from the beginning of January, since I assume this is a matter that the Government now keep constantly under review? The Explanatory Memorandum says:
“The Government’s reasonable worst-case scenario suggests that there might a freight flow of 60% to 80% of usual volumes at the short Channel crossing in the weeks following the end of the transition period, and that could lead to queues of up to 6,500 HCVs for January 2021 rising to 7,000 in February 2021 in Kent.”
What does that actually mean in terms of travel disruption? It also says:
“The traffic management measures proposed would only be used during temporary activations of Operation Brock”.
How often, and in what circumstances, is it expected that Operation Brock will be activated? Is it expected to be activated after February, since the Explanatory Memorandum refers to queues of numbers of heavy commercial vehicles only up to February 2021?
The Government are introducing an online check for heavy commercial vehicle drivers taking goods from this country to the EU, which would enable them to confirm at the point of loading their goods that they had the appropriate border documentation. If so, they would then be advised that they could continue their journey. If they did not have the necessary documentation they would be told not to take the goods until the trader had provided all the relevant documentation. Use of the online check for heavy commercial vehicles will be necessary to obtain a Kent access permit, enabling travel on the M20 or the A2/M2. The Government intend to make the use of this online check mandatory for those travelling through Kent to reduce the number of heavy commercial vehicles coming into the county that were not border-ready to travel from Dover or through the Channel Tunnel.
To what extent do the Government expect the new mandatory online check to reduce the need to use a stretch of the M20 and off-road holding areas in Kent for heavy commercial vehicles waiting to cross the channel? Will it eliminate that need? If not, to what extent will they still be needed, and by a maximum of how many heavy commercial vehicles at any one point? What will be the extent of delays if on-road and off-road holding areas have to be used? How much longer, on average, will it take a heavy commercial vehicle to complete the journey across the channel, once in Kent, than it does now?
If there are to be delays for heavy commercial vehicles in Kent and the need for the use of holding areas, what facilities will be available for use by the drivers of those vehicles from the end of the transition period? Can the Government guarantee now that there will be no issue of insufficient driver welfare facilities, including sanitation, toilets and food, being available from the end of the transition period at the beginning of January? Is it expected that the arrangements provided for in these orders will not be needed at all after the end of October next year, when the orders cease to have effect, or do the Government anticipate having to extend them again?
It is suggested that a reason for delays in Kent could be queues created by extended checking procedures at the port of disembarkation on the other side of the channel, causing blocking back. Is that the case, and by what length of time will journeys for heavy commercial vehicles be extended by new checking procedures at the port of disembarkation on the other side of the channel? Will there be new checking procedures that extend journey times for heavy commercial vehicles travelling in the other direction from France to the UK via Dover or the Channel Tunnel and, if so, will that be as a result of checks this side or the other side of the channel? By how much would journey times be extended on average?
What will be the increase in the number of customs declarations per annum required to be processed in respect of heavy commercial vehicles travelling through Kent en route to the other side of the channel after the end of the transition period, compared with the current annual figure? A question was asked during the debate in the Commons on these regulations about the number of additional customs agents who would be required to manage the increase in customs declarations, but it did not receive an answer. How many customs agents will be required after the end of the transition period, compared with the number needed to handle the current number of customs declarations each year, and how many additional customs agents recruited will be in place from the end of the transition period in some five weeks’ time?
The regulations provide for financial penalties to be imposed on drivers who breach these regulations, most of whom will not be residents of this country. Will there be on-the-spot fines payable immediately, or will there be a set number of days in which to pay? Will a breach of the regulations in all or any cases be regarded as a criminal offence? As my noble friend Lord Whitty and others have asked, is it right that a driver should be fined for having incorrect documentation, which is surely the responsibility of the company sending the goods?
The heavy commercial vehicle sector of the road haulage industry has helped keep our country going during the coronavirus outbreak; in particular, in maintaining essential deliveries of food, medical supplies and other goods. We do not want to see this vital sector hit by chaos at, or near, our major points of exit for UK trade in goods at Dover and the Channel Tunnel. I hope that the Government will be able to respond now or subsequently to the many questions and points that have been raised by noble Lords, including me, during this debate, and provide assurances that chaos at our major point of exit for UK trade in goods is not going to materialise.
Baroness Vere of Norbiton (Con)
My Lords, I am extremely grateful to all noble Lords for their contributions to this important debate. I already know that I do not have a hope in answering all their questions. I will therefore deal with as many as I can and, of course, will write on points that I have been unable to cover. I should like to address up front some of the points that noble Lords raised.
This SI covers Kent because it is the area that will be most under pressure, but I reassure noble Lords that we are working closely with local resilience forums at all the major ports. We do not expect levels of disruption to be as significant at those other ports. Indeed, many plans are already being put in place by local resilience forums. We will keep an eye on that but this measure is about Kent. More than any of the others, the short straits is the crossing that is most used. I reassure noble Lords that the Kent resilience forum liaises closely with surrounding counties. It is not just about Kent but about movement of traffic that is sometimes a significant distance away. The Kent forum liaises with the surrounding areas.
A number of noble Lords mentioned the date and whether 31 October is sufficient. We believe it is. It is right to come back to Parliament to seek to extend it. I hope not to be back in October to face the music in your Lordships’ House. The purpose of the entire project is to enable traders to have time to adjust to the new customs requirements. Once that has happened and the hauliers know which documents to expect from their traders, this will not be required. You need customs documents at borders in all sorts of places, across the world. This is not a unique circumstance; it is a transition.
This will be activated. The simplest answer to when it will be activated is when it is needed. That depends on the readiness and volume of the hauliers approaching at any time. Many variables will go into the decision by Kent Police to put Operation Brock in place.
Many noble Lords talked about the level of disruption. Our current estimates state that there could be up to 6,500 HCVs in January. Given a slight increase in usage of the crossing in February, if trader readiness does not improve—and I hope it does—the queue could reach up to 7,000 HCVs. These are maximum or reasonable worst-case figures. This is not what we expect or anticipate to happen; it is what we are planning to happen. Our motto in the DfT is to plan for the worst and hope for the best. It is important to recognise that: there will not be 7,000 HCVs parked in Kent, every day, from January to 31 October. It will get better.
I will address the recent disruption in Kent, which I recognise happened, on Tuesday. The French authorities trialling their post-transition boarding systems was one factor, but there was also a power outage at Euro- tunnel, which exacerbated the situation and caused delays on the M20. That disruption was contained and further measures were not required.
Local consultation is important, because we all recognise the impact on residents in Kent, which is why we want this to be resolved as quickly as possible. We want traders to be ready and for things to go back to where they were before, when one could get on the Eurotunnel easily and quickly, whether one was a private driver or in a HCV. So we have been in consultation with local people, which is incredibly important. We consulted local people, unions and various stakeholders on the policy changes that are before your Lordships’ House today.
Picking up the point made by my noble friend Lady Wheatcroft, the site at Sevington, previously known as MOJO, was put in place using an SDO—special development order. It is a quicker way of getting planning permission. However, even that requires engagement with local residents. There is a 14-day engagement period, when the views of local stakeholders can be gathered. It is important to understand local concerns and to mitigate them where we can. We understand that we probably cannot make everybody 100% happy but, where we can improve the situation, we are committed to doing so. We continue to communicate closely with local residents and businesses.
Also mentioned by my noble friend Lady Wheatcroft was the on/off nature of the barrier in the middle of the M20. The permanent barrier was removed, because it requires a speed limit of 50 miles an hour, which slows down the traffic. We have a much better solution now; we have a monster machine that can move a barrier in place when we need to put a contraflow into action. We do not expect that barrier to be in place most of the time.
A number of noble Lords had questions on fines and enforcement. Basically, if you are stopped as a driver, you will get a piece of paper that says, “You need to pay £300.” You will either get a penalty charge notice, which gives you 28 days to pay, or, if you are a foreign haulier, you will get a piece of paper saying, “We want the money now”, in the nicest possible way. I reassure noble Lords that fines can be paid by direct transfer or credit card. It is very unusual for cash to be used in these circumstances.
A number of noble Lords also asked why the driver is at fault here. It is because the driver has done something wrong. The driver is not being fined for having incorrect documentation. The driver is being fined for driving on a road that they should not have been driving on. The driver is being fined because they committed the offence.
A number of noble Lords expressed deep concern about the DVSA and whether it would be able to do this. The DVSA does this every day. This is what it does. It does enforcement. It levies fines for various areas including overloads, drivers’ hours and construction and use defects. This is what the DVSA does. It takes about 10 minutes to issue one of these fines. and the DVSA is perfectly capable of pulling over a vehicle into a layby.
A number of noble Lords asked which vehicles are included, whether some vehicles would get priority and all that sort of stuff. The noble Lord, Lord Whitty, asked whether we would give special dispensation to vehicles coming from the Republic of Ireland through to the short straits. All vehicles of whatever nationality will be treated equally, whether they start in the Republic of Ireland or anywhere else. These Kent access permits can be booked at any time of day. They last for 24 hours, so that should not cause a problem with planning journeys.
I forget which noble Lord mentioned emergency vehicles and their ability to pass. That is the point of these orders. They define exactly where HGVs can park up and stop and therefore leave the routes clear for private motorists, local traffic and emergency vehicles. That is the entire point of these orders.
We talked about prioritisation. It is very important. It is right that it is limited for animal welfare reasons to single loads of fresh and live seafood and day-old chicks. Defra estimates that on average about 70 HGVs a day would be of such exports. As I mentioned earlier, because the orders are in place we know where the trucks will be. They will be able to bypass the trucks and get on to the ferry or the Eurotunnel train quicker. Local haulier permits are needed only if they are going abroad. It means that they do not have to go to the back of the queue and can go straight to the departure point.
On information for drivers, I recognise that one type of information will not fit all. That is why we are providing information in different formats, in different locations, in handbooks and in physical advice sites. Our engagement with Logistics UK and the RHA is ongoing. It is extensive and we take great heed of what the unions have to say. On driver welfare, the Kent Resilience Forum is looking at that in great detail. Facilities will be in place at Sevington and at Manston Airport. There will be wi-fi at Manston Airport. There will be loos. There will be catering facilities. We are looking at putting in medical facilities. I believe that by the time we get to use these facilities they will have all that is needed for driver welfare. I will also remind my honourable friend Rachel Maclean about her offer to meet Unite. It is only Thursday and the offer was made on Monday, so I think we can give her a few more days.
I have many other questions that I really wanted to address but I have gone over so I will have do so in writing. They were on customs agents, heat-treated pallets and Covid contingencies. I go back to the key point that after 31 December we will need customs documents. Therefore, these arrangements may be required. It is essential that hauliers and traders are ready for 31 December. The more they are ready, the less likely it is that we will need these arrangements.
Heavy Commercial Vehicles in Kent (No. 2) (Amendment) Order 2020
(4 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Vere of Norbiton
That the draft Order laid before the House on 22 October be approved.
Relevant document: 33rd Report from the Secondary Legislation Scrutiny Committee
Law Enforcement and Security (Separation Issues etc.) (EU Exit) Regulations 2020
(4 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Williams of Trafford
That the draft Regulations laid before the House on 13 October be approved.
Relevant document: 32nd Report from the Secondary Legislation Scrutiny Committee
The Minister of State, Home Office (Baroness Williams of Trafford) (Con)
My Lords, the House will be aware that the Government have been preparing for the end of the transition period on 31 December. This statutory instrument forms one of the legislative changes that we are making as part of these preparations to ensure the law is clear and accessible on cross-border law enforcement and criminal justice matters.
I hope it is clear from the statutory instrument and accompanying documents not just what the regulations do, but also what they will not do. These regulations are required under any EU exit scenario. They will not enact the outcome of any negotiations; in that sense, they are scenario agnostic. Instead, they will provide legal and operational clarity on the handling of live law enforcement and criminal justice cases and procedures at the end of the transition period. They will ensure that the UK has a fully functioning statute book.
They will do this in three ways. First, they will make the changes needed in UK law to give full effect to the separation provisions contained in the withdrawal and separation agreements with the EU and the EEA-EFTA states. These provisions concern ongoing cases and procedures at the end of the transition period and place reciprocal obligations on the UK, EU and EEA-EFTA states regarding their handling. For example, should UK authorities receive a European investigation order—an EIO—from an EU member state or vice versa and be unable to execute it before the end of the transition period, there will be a legal obligation to finish executing that request under the EIO procedure after the transition period ends. Ensuring these separation provisions are in place for this and other EU measures will enable the orderly completion of those ongoing cases and procedures.
Secondly, and in a similar vein, they will make the necessary amendments in UK law to give full effect to the related data provisions contained within these agreements. These provisions concern data accrued before the end of the transition period or under the separation provisions and will provide clarity for operational partners on the handling of those data. As an example, where a European Criminal Records Information System—ECRIS—request for criminal record information is made by the UK to an EU member state, or vice versa, before the end of the transition period and the information is received after the end of the transition period as a result of that request the restrictions on the use of personal data under ECRIS will still apply.
Thirdly, the regulations will address a number of deficiencies that would otherwise arise at the end of the transition period, for example, where new EU law has come into force during the period since the Law Enforcement and Security (Amendment) (EU Exit) Regulations 2019 were passed. Addressing these remaining deficiencies will ensure that the UK has a fully functioning and relevant domestic statute book at the end of the transition period.
Overall, the scope of this statutory instrument is narrow. It gives full effect to the separation provisions contained in the withdrawal and separation agreements by making the necessary technical changes in UK law. This will provide legal and operational clarity on the handling of live law enforcement and criminal justice cases at the end of the transition period and will therefore enable the UK to meet its legal obligations under these agreements. I am sure noble Lords will agree that that is essential.
The safety and security of our citizens is the Government’s top priority and this statutory instrument helps to support that. I commend these regulations to the House. I beg to move.
Lord Reid of Cardowan (Lab)
My Lords, first, I thank the Minister, who I think is aiming for the Stakhanovite prize for her endeavours at the Dispatch Box.
I say right at the beginning that it is a bit of an obfuscation for the Minister to say that the regulations are scenario-neutral. They are in the limited sense, in that whatever the nature of the deal, they will be put through, but of course they are being introduced in the whole context of Brexit, which is the biggest change imaginable in the scenario for law enforcement and counterterrorism. The Minister’s allusion to the neutral scenario reminded me that one old philosopher used to say, “We have free will”, but, as he pointed out, we do not have free will in circumstances of our own choosing. So the regulations might be scenario-neutral but they are in the wider scenario of Brexit, and that is what I want to refer to today.
Obviously, as the Minister implied, I, like others in the House, will not oppose these regulations. It is in all our interests to have confidence in our law enforcement capabilities and operations after Brexit. Therefore, I do not intend to oppose them but I want to make some observations.
The first and most obvious to everyone is the desperate lack of time available for our law enforcement agencies to adjust to any new framework or operational procedures. It is obvious that we are now only weeks away from the end of the transition period and still the two parties—like children in the playground playing “Don’t push me or I’ll push you”—are issuing statements every week without any word of substantial advance in them. Meanwhile, our law enforcement and security services still do not know what legal regulatory framework they will be operating under after New Year’s Day. Nor do they know what the practical impact or implications of any security and criminal justice deal will be for their ability to keep the public safe.
Will the Minister therefore tell us how the Government have engaged with our law enforcement agencies or, for that matter, with their European counterparts to ensure that the appropriate arrangements will be in place so that relevant cases can be actioned with confidence and not delayed or stopped? Later, I will refer to ECRIS, the European Criminal Records Information System, to which the Minister referred. Obviously, we need confidence that outstanding cases will not grind to a halt, as that would diminish our ability to tackle criminality and prevent terrorism.
The second issue arising from this timing pressure is the uncertainty caused. We do not know, even at this stage, whether we will have a deal or no deal. Regardless of the assertions that this measure is scenario-neutral, it will have an effect on the practical application and operational capabilities of our law enforcement agencies. In November, the Minister—not the noble Baroness but the Minister in the House of Commons—rather blithely told the House that if negotiations
“do not conclude successfully, we will move back to pre-existing tools and powers.”—[Official Report, Commons, 5/11/20; col. 528.],
as though this was, again, scenario-neutral. But presumably those pre-existing powers and tools were less effective and less satisfactory than the subsequent arrangements made within the European Union, otherwise there would have been no point in adopting the new arrangements. To reinforce that point, Mr Martin Hewitt, the chair of the National Police Chiefs’ Council, laid out the consequences, and I could not put it more concisely myself. He said that
“the loss of some or all of the tools will mean that, even with contingencies in place, the fallback systems will be slower, provide less visibility of information/intelligence and make joined-up working with European partners more cumbersome.”
That could not be plainer. Does the Minister therefore accept that a failure to conclude negotiations successfully will inevitably involve a deterioration in our capacity to combat crime and insecurity, as laid out by Mr Martin Hewitt, who presumably knows a little bit about these matters? I have some specific questions for the Minister. In her opinion, what is the likelihood of that situation arising? What contingency plans are in place for the loss of these vital tools? What is the certainty regarding Europol arrangements or the Schengen Information System? What about the loss of the European Criminal Records Information System, which effects about 4,000 requests every month? If I understood the Minister correctly, applications that are already in that system will continue. I accept that, but what about the 4,000 a month that will happen after 1 January 2021? What are the arrangements and availability of information for those? What are the details of the fast-track extradition arrangements, which are to replace capabilities enjoyed under the European arrest warrant? Is it not the case that diminished capabilities on data and information sharing would seriously damage the fight against crime, terrorism and insecurity?
The fact that such questions remain unanswered at this late stage indicates just how precarious the position is. As I said at the beginning, I am not opposing this. Today’s regulations are necessary, but they are not sufficient to inspire confidence or engender certainty that our agencies will maintain the standards of law enforcement that they have hitherto reached in order to fulfil our legal commitments on law enforcement and counterterrorism. That is why I give them my very qualified support.
Lord Mackay of Clashfern (Con) [V]
My Lords, it is a privilege to follow my fellow countryman, who has such experience of the Home Office and its capacity to prophesy and made a very notable analysis of the Home Office in his time. I propose to restrict myself to dealing with this statutory instrument, rather than with prophecy.
When I saw this instrument on the list, since I was not involved in any Bill, I thought that I should participate. Although I have a fairly general knowledge of the criminal laws of the United Kingdom, I felt a profound difficulty when I looked at this instrument, until I came to the bottom of the last page of the Explanatory Note and the reference to the Explanatory Memorandum.
I congratulate the Home Office on the dramatic clarity of this document and the way it directs us to the sources of the provisions. As the Minister has said, these are contained in the withdrawal legislation relating to the withdrawal agreements from the EU, EEA and EFTA, with the powers given in statute to deal with the deficiencies that might arise in retained EU law. As a result, it is easy to check that the provisions have direct statutory authority or are reasonable exercises of the power given to Ministers to deal with deficiencies in retained EU law. The inclusion of material with no legal effect was a judicious use of the author’s clarity of exposition. It is also welcome that the instrument has been agreed by the relevant devolved Administrations.
I hope that this vitally important area of the law will be consolidated at the appropriate time. I congratulate the Minister on the clarity with which she introduced this statutory instrument, and I thank her for it.
Baroness Jones of Moulsecoomb (GP)
My Lords, it is a pleasure to follow the noble and learned Lord, Lord Mackay of Clashfern, but I disagree quite strongly with him. We have had a lot of these statutory instruments coming through, some of them excruciatingly boring, and we use them as an opportunity to talk about much wider issues. Some are actually quite dangerous and some—this is one—are really quite messy. The Explanatory Memorandum admits as much. The statutory instrument jumps around dozens of different areas of law enforcement co-operation with the EU and makes little tweaks here and there to try to fix deficiencies for when we finally leave the EU. I accept that we need this sort of statutory instrument but, quite honestly, I do not see the clarity here.
One thing we saw throughout the last few months of the pandemic was the confusion, particularly for the police, over the advice from the Prime Minister and the later comments and suggestions from Ministers interpreting it, versus the rules and the actual law. There was a lot of confusion and the police overstepped the mark quite a lot. I basically feel, although I do not have much confidence in our law enforcement agencies, that they were not to blame—it was actually the Government. They presented so many confusing scenarios that the police did not really have much chance to enforce the law. What will the Government do to make sure that this is a clear law, properly understood by the police and security services, so that we do not see the abuses we have seen over the past nine or 10 months? What plans do the Government have to bring consolidating legislation—to put it all in one place and reduce the chaos? It simply is not fair on the police that the Government throw out this stuff and do not give them the time, as the noble Lord, Lord Reid, suggested, or the clarity to be sure that they are not breaking the law when they try to apply this.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
The noble Baroness, Lady Goudie, has withdrawn, so I call the noble Baroness, Lady Ritchie of Downpatrick.
Baroness Ritchie of Downpatrick (Non-Afl) [V]
My Lords, it is a pleasure to follow the noble Baroness, Lady Jones of Moulsecoomb. I thank the Minister for her explanation of these regulations. Although she says they are limited, they cover quite a wide range of law enforcement and security issues, including some 50 regulations on important work on cross-border surveillance, extradition and exchange of information and intelligence between law enforcement authorities, EU agencies such as Eurojust and Europol and EU security databases. It has become apparent to us, to follow what was said by the noble Baroness, Lady Jones, that the withdrawal Act was actually quite skeletal: we are filling out all the various sectors and sectoral areas through the use of statutory instruments.
While I acknowledge the need for these regulations, I have some questions for the Minister. I have been told that there is total lack of certainty regarding the UK’s future security and law enforcement relationship with the EU. We are some five weeks away from the end of the transition period and our law enforcement agencies still do not know what legal and regulatory framework they are winding down to, nor the practical day-to-day impact of any security and criminal justice deal—or, indeed, no deal at all. What will be their ability to keep the public safe, because that is always the issue when we concentrate on law enforcement? Will the Minister indicate whether there has been any movement from uncertainty to certainty in such matters? I know the Minister said that this is simply about legal and operational clarity and does not deal with the negotiations, but are any of the law enforcement issues or policies part of the discussions in the negotiations?
I am reminded of what the chief constable for Northern Ireland told the Northern Ireland Affairs Committee in the other place: with the end of the transition period just a few months away, there are concerns about how the PSNI can track people and how to move information around to keep communities safe. They have the added difficulty of the implications of the internal market Bill and the impact on the withdrawal agreement and the potential creation of a hard border with the EU on the island of Ireland, and thus that intersection with the Northern Ireland protocol. What thought has been given to those issues, in terms of law enforcement and security separation issues after we leave the EU?
There is also the added complication of the customs posts in Belfast, Larne and Warrenpoint. What will be the law enforcement and security role in those? The PSNI, as the local law enforcement agency in Northern Ireland, does not seem to have any information on how to deal with this. I am sure that the noble Lord, Lord Reid of Cardowan, as a former Secretary of State for Northern Ireland, will know how important the PSNI is to maintaining good security and good policing in Northern Ireland on a cross-community basis. Could the Minister provide an update on this matter? Could she also outline whether there has been any resolution around the National Crime Agency? It believes that reduced UK ties with EU instruments will damage UK security since maximum co-operation is essential to address sophisticated international threats. What is the current position? Albeit that these regulations are limited, they open up Pandora’s box—hence my list of questions.
I understand from some research that the UK is still seeking access to Europol databases, as if it never left the EU. What is the situation with data sharing, as I understand that the PSNI has been presented with challenges in this area? Apparently the UK Government want to be a de facto member of the Schengen Information System, without being an actual member, to gain access to information on migrants, border security, terrorism and other areas of law enforcement. Has there been or will there be an agreement on law enforcement, criminal justice and data-sharing arrangements? Will the UK also remain engaged with the European Global Navigation Satellite Systems Agency, which manages Galileo, the EU’s satellite system, which provides encrypted services for police and border control?
It is patently clear that leaving the EU will have a substantial impact on UK security, given the close co-operation established over many years in policing, crime prevention and criminal justice. That level of evidence base must not be allowed to wither on the Brexit vine.
Lord Garnier (Con) [V]
My Lords, the noble Baroness, Lady Ritchie, always informs our debates. One of the fears that I had during the Brexit debate before the referendum was that if we left the EU, we would damage the co-operation, and its speed and effectiveness, between the law enforcement and investigatory agencies of the United Kingdom and the remaining 27 states. Since we joined the EU, the bilateral assistance that our agencies have given individual EU countries and vice versa has only improved. Although there have been some glitches and a few eccentric decisions flowing from the use of European arrest warrants, the EAW system, as well as the wider international assistance in law enforcement and co-operation between the security services, has worked well to our mutual benefit.
I agree with my noble and learned friend Lord Mackay of Clashfern; my noble friend the Minister has clearly explained the ambit and purpose of these regulations. They should ensure that, when translated into our national law, they will be every bit as effective as before and deal with any deficiencies in retained EU law. There is a list of about 20 separate areas of law enforcement activity covered by these regulations in which we have, as a member of the EU, co-operated with other EU countries. No one can doubt their continuing importance to our own and our shared protection from the activities of the most serious criminals.
It is clearly vital that these regulations should be in force before 31 December this year and I doubt that the regulations themselves are controversial. The Government’s intentions are clear and understood. That said, the noble Lord, Lord Reid of Cardowan, has made some pertinent points. However, I should like my noble friend the Minister to reassure me that, even when we have finally left the EU in the new year, the practical and operational work covered by the current legal framework will not diminish in volume and quality.
Terrorists, money launderers, cyber criminals and human traffickers will exploit any lack of international co-operation. They do not care or mind whether we are in or out of the EU. Investigations into their activities, and their prosecution with evidence gathered from both sides of the channel, must carry on without reduction or legal impediment after 31 December with the same, and even increased, operational vigour as they have until now. Departure from the EU is no reason for any alteration in our approach or metaphorically to cut the wires between the United Kingdom and the EU 27.
Lord Bhatia (Non-Afl) [V]
My Lords, the Law Enforcement and Security (Separation Issues etc.) (EU Exit) Regulations 2020 allow for the implementation of the separation provisions in the UK-EU withdrawal agreement relating to law enforcement and security co-operation. Although the UK has left the EU, it continues to participate in a range of EU law enforcement and criminal justice co-operation schemes. This participation will continue until the end of the transition period.
The Home Office states that this SI has three functions. First, while the EU withdrawal agreement Act implemented the withdrawal agreement, this SI would make the “necessary further, specific amendments” to give full effect to the LECJ separation provisions in the agreements. The separation provisions require the continued application of EU measures in cases still ongoing at the end of the transition period. Secondly, the regulations amend UK law to give effect to provisions which require the preservation of relevant law on criminal justice data and information collected prior to the end of the transition period. Thirdly, as the body of EU law relating to LECJ co-operation either ceases to apply in the UK or is transferred into “retained EU law” at the end of the transition period, the regulations would make amendments to “address deficiencies” in the retained law. For that purpose, the current regulations would amend the two regulations passed in March 2019 to take account of EU law which has come into force since they were made.
On 18 November, the Minister for Security said that scope of the regulations was “narrow” and they would be required under any scenario in which the UK had left the EU. He went on to say that this SI
“will provide legal and operational clarity regarding the handling of live law enforcement and criminal justice related cases and procedures at the end of the transition period, and will ensure that the United Kingdom has a fully functioning statute book.”—[Official Report, Commons, Fifth Delegated Legislation Committee, 18/11/20; col. 3]
Lord Mann (Non-Afl)
My Lords, having listened to the Minister and read in detail the documentation, I can recall what I said in the House of Commons 18 months ago and privately, as well as publicly, on many occasions at the time, when I was one of a tiny handful of enthusiastic backers of the agreement that the European Union made with the British Government of the time, which Parliament chose to reject. I said that there is no such thing as a no-deal scenario because this means thousands of deals, but those will have to be done separately and in isolation. One of the problems with that is that there will be so many.
In the context of these changes—which I do not oppose—will the Minister tell us how many separate agreements will be required, purely from the scope of these regulations? Are we talking about bilateral deals with each country, or are we talking about a single deal on a range of different issues with the European Union? Will those deals be in place from 1 January? Do we have the capacity? We have had all sorts of complications, because of Covid, in terms of how we work. One thing Covid has not done is make negotiations easier; it has made them more difficult. It is harder to get people and it is harder to fix meetings for decisions of any kind to be made. When they are multilateral and require negotiation, if we do not have a deal—though I suspect that we will probably end up with one, and I feel that is the way things are moving—are all the individual deals required in place to allow law enforcement to act as it did? I suggest that that is not possible: the capacity to do that in that timescale is not possible.
Will we potentially have the following scenario from January? The Home Secretary and the NCA previously described an earlier operation against organised crime, in which the NCA had managed to break into phones in some way, as the most successful in the history of policing in this country because we managed pretty simultaneously, across many different European countries and in this country, to arrest many hundreds of serious organised criminals. As I understood from what the Home Secretary and the NCA said at the time, these were people who were involved in major crimes—gun crimes and the rest—who were significant and dangerous criminals, and that happened across Europe, including in this country. Are the arrangements going to be in place that would allow a new such operation to begin seamlessly on, say, 2 January?
Will there be criminals in this country whom we have problems extraditing to another country because a deal will not have been negotiated with that other country by the time we get to January? Will there be criminals whom we wish to bring back from other countries—from Spain, France or wherever—to face the prospect of justice in this country, where we might not be able to do so because the agreements are not in place? Would I be right in thinking—as some of these agreements will be very technical and complex—that the presumption has been for a long time that any changes that might come would actually be in the light of a deal, and so would be negotiated over a much longer and more rational time period, rather than forced through in an incredibly short period simply to hold the system together?
Will there be bits of information that we cannot access purely because we do not have a deal in place, in a no-deal scenario? As I said—and I am sure that the Minister will agree—there is no such thing as no deal; it merely means that the deal on these issues has not been concluded because there has not been the opportunity to finish and finalise it, since we do not even know if we need it, as that is dependent on whether we get the bigger deal.
I appreciate that this is not the responsibility of the Minister—although it will be part of her department’s problem and the Ministry of Justice’s problem—but it is the problem of government and it is the problem of Parliament, because a scenario that allows criminals more freedoms than the law would wish to give them, simply because of jurisdictions crossing borders, is not—I think I can say without equivocation—what anybody voted for or perceived would happen.
The taking back of control that I and others argued for, voted for and won a referendum on was predicated precisely on the ability to do the things that we want to do and have international agreements in place. As I say, I was very relaxed with what was described as the Theresa May deal—I always tried to describe it as the European Union deal because that was the other party to it—because we would have avoided all these problems. I suspect that I am not the only person in this Chamber now who was of that view. However, we were a tiny majority, unfortunately, and we were unable to persuade any party. We failed the people there—I apologise for my part in that failure—but we tried. At least we recognised that this is probably for the British people the single biggest problem. No politician would be able rationally to explain, “Well, the criminal got away with it because we don’t have the agreement in place because we’ve not had the time to get the agreement in place. We will do but we can’t do so, sorry, come back next year and we’ll try again.”
Are those dangers or am I overstating the risk? I do not think that I am, having heard the Minister and read the documentation. There is a problem, which therefore suggests that, even with this deal at this current stage, the deal that can be agreed would have bigger positives for the country than the so-called no-deal option. That would mean thousands of further deals having to be negotiated, including many in the immediate future; we do not have a good capacity for that, and no one could have the capacity to do that.
Lord Paddick (LD) [V]
My Lords, I thank the Minister for introducing these regulations.
The stream of worrying statutory instruments dealing with our final severing of links with the EU at the end of the transition period continues. We have already debated regulations that will weaken UK border security; now, we have regulations that deal with the end of co-operation with the EU on a whole range of criminal law, investigatory powers, policing and criminal justice issues. When a similar raft of regulations, which these regulations amend, was debated, the Secondary Legislation Scrutiny Committee, as it put it,
“published a critical report because the 2019 Regulations bundled together a large number of topics without adequate information on any of them.”
Here we are again, with one SI containing 50 regulations relating to a wide range of law enforcement and security issues.
The regulations cover extremely important issues, such as cross-border surveillance, extradition, the exchange of information and intelligence, Eurojust and Europol, and security databases such as the Schengen Information System—SIS II—and the European Criminal Records Information System, or ECRIS.
The Minister explained the purposes of these regulations and the noble Lord, Lord Bhatia, repeated them so I see no point in repeating them again. However, I share the concerns expressed by many other noble Lords this afternoon. It is 36 days until the end of the transition period. Let me remind the House what these regulations are about. At the moment, there are arrangements in place to allow law enforcement and security services to follow dangerous criminals, including terrorists, across borders. So if the National Crime Agency has undercover officers following a gang involved in people smuggling, for example, they can pursue them across the channel and across the EU. As things stand, that ability will end on 31 December.
At the moment, rapid extradition from the EU to the UK, including of a country’s own nationals, can be achieved using the European arrest warrant. As things stand, that will end on 31 December.
At the moment, information and intelligence can be shared between law enforcement authorities in the UK and those in the EU. This includes the Prüm database, which allows rapid electronic matching of fingerprints and DNA samples found at any crime scene in the UK with those in databases of criminals held across the EU. As things stand, we will no longer have access to these databases come 31 December.
At the moment, the SIS II database is in place, which triggers an alert when someone travelling across an EU border is wanted or of interest to the police or security services. It also provides information about what action border security officials should take. As things stand, we will lose access to that database from 1 January.
At the moment, Eurojust co-ordinates investigations and prosecutions involving more than one country by helping to resolve conflicts of jurisdiction, for example. As things stand, we will no longer be a member of Eurojust on 1 January.
Finally, Europol co-ordinates law enforcement activity across the EU to deal with serious and organised crime, such as drug and people trafficking, terrorism and cybercrime. Crucially, it produces threat assessments in these areas, which pose the most serious criminal threats to the EU and the UK. These are used to prioritise law enforcement activity. As things stand, the UK will go from being one of the agenda-setting countries in Europol to having observer status. I say, “as things stand”, but we have only 35 days to prevent these things.
Can the Minister give us a detailed account of which, if any, of these measures, which are vital to the security of the UK, are likely to still be in place on 1 January? Let me help her a little. The BBC reported last week that the UK wanted to maintain the same access to Prüm, SIS II and the other EU databases that are vital to our security, but that the EU says that those are not on offer to non-EU members. We know from the experience of Norway and Iceland that non-EU members cannot be part of the European arrest warrant, and the second-class alternative they have does not allow extradition of a country’s own nationals. Even that took over a decade to negotiate and come into force. So can the Minister confirm that whatever security treaty the UK is able to negotiate with the EU will not include access to EU databases or the European arrest warrant?
Metropolitan Police Assistant Commissioner Neil Basu, Britain’s top counterterrorism officer, told the BBC last week that the UK will be less safe without an EU security deal in place. Is it not the case that the UK will be less safe whatever security deal is agreed, or if no security deal is agreed, as it will not include access to EU databases and the European arrest warrant? I am sure these regulations—all 50 of them—are necessary, but they provide a stark reminder of what we are losing as a result of leaving the European Union.
Lord Rosser (Lab) [V]
I too thank the Minister for her explanation of the content and purpose of these regulations. They make amendments to UK law to give effect to the separation provisions relating to law enforcement and criminal justice co-operation contained in the withdrawal and separation agreements. They provide for the winding down of cross-border judicial and police cases in progress at the end of the transition period, including by requiring that data protection arrangements will continue to apply to any information required before the end of this year. In that particular sense, the provisions of these regulations are effectively time-limited. The regulations also amend the Law Enforcement and Security (Amendment) (EU Exit) Regulations 2019 since they address new developments since the 2019 regulations were made, including in relation to the application of the Prüm directive to the UK.
The Government argue that these regulations are necessary to ensure a smooth transition to alternative arrangements regarding the handling of live cases and procedures at the end of the transition period. The reality is that the regulations provide little clarity or certainty to either the people of this country over the arrangements applicable from 1 January next year, or to our law enforcement and security services, who still do not know, five weeks from the end of the transition period, what legal and regulatory framework they will be winding down to, or what the practical day-to-day impact of any security and criminal justice deal, or no deal, will be on their ability to keep our people safe—a responsibility which is surely one of the most important priorities for any Government.
On cross-border data sharing and information sharing, lowering current capabilities would be very damaging and would adversely affect our country, hindering our ability to receive alerts, search for criminal records and extradite criminals. My noble friend Lord Reid of Cardowan referred to a letter published last week to the Select Committee on Home Affairs from the chair of the National Police Chiefs’ Council, which said that
“the loss of some or all of the tools will mean that, even with contingencies in place, the fallback systems will be slower, provide less visibility of information/intelligence and make joined up working with European partners more cumbersome.”
Could the Minister do something that the Security Minister in the Commons failed to do three times, and say whether the Government agree or disagree with that assessment by the chair of the National Police Chiefs’ Council?
Could the Government also say in their response what assessment they have made of the scenario that British law enforcement will find itself in on 1 January—in five weeks’ time—in light of concerns about the effectiveness of contingency arrangements and the clear view of police leaders on the need to retain EU tools to retain current levels of operational effectiveness? Could the Government tell us what capabilities we will have after the end of the transition period in relation to the Schengen Information System, SIS II, which we use extensively and appear set to lose?
Could the Government tell us what fast-track extradition arrangements there will be to replace existing capabilities from which we currently benefit under the European arrest warrant? What will replace the loss of the European Criminal Records Information System, affecting 4,000 requests every month? What will our position be after the end of the transition period in relation to Europol and future partnership working on law enforcement across Europe, which has been so effective? What will the position be in relation to future access to a passenger name records database, providing information on terrorists and criminals trying to enter our country, and the Prüm database for DNA, fingerprints and vehicle registration data?
The specific regulations we are debating are needed to fulfil our legal commitments on law enforcement and criminal justice separation provisions. But to have law enforcement, counterterrorism and security services winding down operations, knowing that some will not be wound up again and that some, if there is a deal, may or may not be wound up again to effective levels in the new year, is hardly a satisfactory situation to be in when we are talking about the safety and security of our citizens. In addition, the uncertainty is causing focus in our law enforcement agencies to concentrate less on day-to-day priorities in order to address this uncertainty over what arrangements will be applicable after the end of this year.
Along with other noble Lords who have spoken in this debate, I await the Government’s response to the points and questions raised, including by myself, and will be looking for meaningful assurances, not unsubstantiated statements of hope, that our law enforcement agencies and security—[Inaudible]—protect us all.
Baroness Williams of Trafford (Con)
I have to tell the noble Lord, Lord Rosser, that he was cut off just at the appropriate moment, as he was about to finish. I thank him and all noble Lords for their contributions to this debate and their constructive approach to the regulations, although many noble Lords did not talk about the regulations at all; they took this opportunity, and rightly so, to talk about other issues around the end of the transition period. I also thank my noble and learned friend Lord Mackay of Clashfern, who never fails to impress me, for explaining the whole thing in a few sentences. I was glad to hear that echoed by my noble and learned friend Lord Garnier.
As demonstrated by the debate, there is consensus on the need to provide operational and legal clarity at the point of transition for our operational partners. Doing so enables the orderly completion of ongoing cases and procedures. It is also evident that there is support for the Government meeting our legal obligations under the withdrawal and separation agreements. This is exactly what the statutory instrument does.
The noble Lord, Lord Paddick, bemoaned the 50 different elements to the SI. Interestingly and unusually, there were no comments on this from the Secondary Legislation Scrutiny Committee. The noble Lord, Lord Reid, talked about the lack of time. I cannot deny that time is pressing; we need to establish and conclude these things before 31 December.
The noble Lord, Lord Mann, asked me a question about how many deals. It is impossible to say at this point. The focus is clearly to reach agreement, which we are working intently to achieve. I cannot comment beyond that. My noble and learned friend Lord Garnier made the correct point that criminals do not care whether we are in or out and will exploit any softening of co-operation. That is absolutely correct. I reassure my noble and learned friend that we will continue to work closely with our European partners to tackle our shared security threats and promote the safety and security of our citizens.
We have been negotiating an agreement on law enforcement and criminal justice to equip our operational partners on both sides. There is a good degree of convergence on the operational capabilities that the UK and EU have been negotiating, and we have been able to make progress since we began negotiating legal texts. It is clearly in the interests of both sides to reach an agreement.
The noble Lords, Lord Reid and Lord Rosser, talked about a day-one non-negotiated outcome. We must continue to prepare for all possible scenarios at the end of the transition period. In the event that it is not possible to reach an agreement, the UK has well-developed and well-rehearsed plans in place. They involve transitioning and co-operation with EU member states to alternative non-EU arrangements by the end of the transition period, where available. Broadly speaking, they would mean making more use of Interpol, Council of Europe conventions and bilateral channels. They are tried-and-tested mechanisms, which the UK already uses for co-operation with many non-EU countries. Interpol was the primary means by which the UK exchanged warnings and alerts with EU member states as recently as 2015, and we continue to work closely with the police and other law enforcement and criminal justice agencies in the UK, as well as the devolved Administrations, to ensure that we are ready for a range of possible outcomes at the end of the year.
The negotiators have been in contact almost every day since 22 October and they are continuing to work intensively to bridge the gaps that remain between us. There has been some progress in recent days but, as the noble Lord, Lord Reid, pointed out, time is now very short. We have been consistently clear that if we cannot reach an agreement that fully respects UK sovereignty, we will leave on Australia-style terms and prosper in doing so.
Law enforcement partners have been working for some time to transition to Interpol channels. We have established and funded the International Crime Coordination Centre to drive readiness. Alongside extensive domestic preparations, we are engaging bilaterally with member states.
The noble Lords, Lord Paddick, Lord Reid and Lord Rosser, talked about the loss of SIS II. We recognise the mutual loss of capability that UK non-participation in SIS II entails. As I have said, Interpol channels provide a tried and tested mechanism for exchanging alert information. It remains the primary means by which EU member states share information with partners within the EU and globally that do not have access to SIS II. We are committed to making our use of Interpol channels as effective as possible. All Interpol circulations received by the UK are now routinely made available at the front line for police and border officers. Measures such as the Extradition (Provisional Arrest) Act give our officers the power to act effectively on information received. The noble Lord, Lord Reid, asked about bilateral agreements as a fallback for losing SIS II. As I have said, there is extensive engagement around EU member states’ ability to use Interpol channels if no agreement can be reached on SIS II.
The noble Lord, Lord Paddick, referred to Neil Basu’s comments. The safety and security of our citizens is the Government’s top priority. If it is not possible to reach an agreement with the EU, the UK has well-developed and well-rehearsed plans in place. Broadly speaking, we would have to make more use of Interpol, Council of Europe conventions and bilateral channels. We want to continue to be a global leader on security and one of the safest countries in the world.
The noble Lords, Lord Reid and Lord Rosser, referred to the letter from Martin Hewitt. There is a good degree of convergence in what the UK and the EU have been negotiating in terms of operational capabilities. On law enforcement, it is self-evidently in the interests of both sides to reach an agreement that equips operational partners on both sides with capabilities to protect citizens and bring criminals to justice. We continue to work closely with the police and other law enforcement agencies in the UK to ensure that we are ready for a range of outcomes at the end of the year. As regards his comments on SIS II, we have always said that there will be some mutual loss of capability in the event that the UK no longer had access to it. That is why we offered to reach an agreement with the EU that delivers a similar capability. The European Commission has consistently maintained that it is not legally possible for a non-Schengen third country to co-operate through SIS II but we have maintained our offer to that end.
Noble Lords talked about the loss of the European arrest warrant and the diminishing of safety to that end. We have left the EU and the EAW is used exclusively by EU member states. Our proposals include greater safeguards than those within the European arrest warrant and the UK will continue to be, we hope, one of the safest countries in the world.
The noble Lord, Lord Paddick, and the noble Baroness, Lady Ritchie, talked about Europol and Eurojust. We are not seeking membership of either agency. That is not how third-country arrangements with these agencies work. In line with the UK approach, our legal text provides for co-operation between the UK and Europol, and the UK and Eurojust, to facilitate multilateral law enforcement and criminal justice co-operation. The type of relationship that we are proposing is in line with third-country precedents, going beyond those only where it is in our mutual interests to do so.
The noble Baroness, Lady Ritchie, also talked about the Northern Ireland protocol. We are committed to implementing our obligations under the withdrawal agreement, and published a Command Paper in May that sets out the approach we will take. We have also laid secondary legislation to implement aspects of the withdrawal agreement to help provide certainty for businesses and citizens in Northern Ireland, to ensure that the statute book is fully functioning for the end of the year, and to discharge our obligations under the protocol.
As for our engagement with the devolved Administrations, the collaborative work with them on the secondary legislation programme covering devolved matters required for EU exit and during the transition period has been a success, with around 300 UK Government SIs laid with the agreement of the devolved Administrations. We have made no secondary legislation without the consent of the devolved Administrations.
We have engaged constructively with the devolved Administrations on readiness legislation, including sharing a list of all expected SIs to the end of the transition period that legislate in areas of devolved competence. Regular forums are held with them, at both official and ministerial level, for legislation to be discussed and any concerns raised. I know that the Home Office regularly meets about 20 delivery partners to review the preparations and monitor any risks, including any in relation to the PSNI.
The noble Lord, Lord Rosser, asked about transfers of passenger name records post transition period. In the event of a non-negotiated outcome, we will engage directly with all EU airlines operating to the UK to conclude arrangements for the transfer of PNR data to the UK in compliance with UK law requiring disclosure of data. The proposed agreements will set out the data protection safeguards operated by the UK that can enable EU airlines to disclose data in compliance with EU data protection legislation. It is a decision for each airline whether to conclude a data transfer agreement with the UK. In the event of a negotiated outcome, where there is a legally binding international agreement on PNR between the UK and the EU, transfers from EU airlines can continue without any issue. I hope that I have covered all the points that noble Lords have made, and I commend the regulations to the House.