House of Commons
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Oral Answers to Questions
(3 years, 6 months ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
The Secretary of State for Health and Social Care (Matt Hancock)
The UK Government work closely with the Scottish Government to provide a co-ordinated approach to the response to covid-19 for the benefit of people across Scotland and across the United Kingdom. For instance, the UK Government have provided the Scottish Government with £1.2 billion in Barnett funding in the 2021 Budget, procured more than 500 million vaccines for the whole of the UK and made sure that our testing programme reaches all parts of the UK. This is a partnership in which the people of Scotland benefit hugely from the reach and strength of the UK Government.
Andrew Bowie
It is becoming clear across the entire United Kingdom that our NHS is facing a huge challenge as we reopen society to deal with the thousands of procedures, treatments and operations that have been delayed due to lockdown. What steps is my right hon. Friend taking to ensure that the national health service in England, Scotland, Wales and Northern Ireland can work together as easily as possible, sharing resources and services to ensure that this truly national health service for our whole country will support delivery to support our constituents wherever in the United Kingdom they might live?
Matt Hancock
My hon. Friend is quite right. The NHS is one of Britain’s proudest achievements. It operates across the whole of Great Britain and co-operation is ingrained in the DNA of the NHS. I am absolutely determined, as the UK Secretary of State for Health and Social Care, to ensure that, wherever people live in this United Kingdom, they can access the very best of care. If a constituent of my hon. Friend’s in Aberdeenshire needs a treatment that is only available in England because it is so specialised, they should have absolutely every right to that treatment, in the same way that a constituent of mine in Suffolk or a constituent in north Wales should. We have one NHS across these islands, and it is one of the things of which this country is most proud.
Dr Philippa Whitford (Central Ayrshire) (SNP) [V]
I am sure the Secretary of State is well aware that the Scottish NHS has been separate since 1948 and has been under direct Scottish Government control for the last 20 years, so there are actually four NHSs. Perhaps I can ask him about some of his decisions that have made it harder for the Scottish and other devolved Governments to fight covid. Last September, he refused to follow Scientific Advisory Group for Emergencies advice for an urgent lockdown, and the six-week delay allowed the more infectious B117 Kent variant to emerge and spread across the UK, driving a second wave more deadly than the first. He has repeatedly claimed to follow the science, so can he explain why he did not follow scientific advice last September?
Matt Hancock
Just on this point, this attempt at division within the NHS is deeply regrettable. It is not what people want. It is not what people want in Scotland. It is not what people want anywhere across the country. The NHS is an institution we should all be very proud of. Of course it is managed locally—it is managed locally across parts of England and it is managed under the devolution settlement in Wales and Scotland, as are health services in Northern Ireland, and rightly so—but it ill behoves politicians to try to divide the NHS. It is a wonderful institution that should make us all proud to be British.
On the specific question that the hon. Lady asked, of course we are guided by the science and take all factors into consideration. These are difficult judgments based on uncertain data, and we make the best judgments that we can. That is still the process we are going through, in the same way that the Scottish National party Government in Scotland have recently opened up parts of the rules in terms of social distancing, despite the rise in cases.
We face a challenging decision ahead of 21 June, but that decision is made easier by—indeed, the decision to open up is only possible because of it—the UK vaccination effort. Today marks six months to the day since Margaret Keenan in Coventry was the first person in the world to receive a clinically validated vaccine—the same day as Scotland, the same day as Wales. Since then we have delivered—
Mr Speaker
Order. It is not a statement, but an answer that we require. I call Dr Philippa Whitford to ask her second question.
Dr Whitford
I think the Secretary of State would find that most people in Scotland were rather glad that their NHS did not come under the Health and Social Care Act 2012 fragmentation. Having ignored the Scottish Government’s call in February for all arrivals to undergo hotel quarantine, he then delayed adding India to the red list. This allowed the more infectious Delta variant, which one dose of the vaccine is less effective against, to enter and become dominant in the UK. Is he not concerned that, if he removes all social distancing completely in the near future, the variant will cause a covid surge among those who are not fully vaccinated?
Matt Hancock
Touché, Sir. In response to the hon. Lady’s question, I will say this. The opening up and the return of our freedoms is only possible because of the UK vaccination effort. In the six months to the day since we first vaccinated across these islands—yes, in Coventry, but also in Scotland, Wales and Northern Ireland—we have delivered 68 million vaccines across the whole UK and saved thousands of lives, and the whole United Kingdom has been set fair on the road to recovery thanks to the UK Government’s vaccination effort. I am very grateful to everybody in Scotland, Wales, Northern Ireland and England who has played their part in delivering it. That shows the benefit of the United Kingdom Union saving lives and working together for everybody on these islands.
Karl Turner (Kingston upon Hull East) (Lab)
Christine Jardine (Edinburgh West) (LD)
Kim Johnson (Liverpool, Riverside) (Lab)
Dave Doogan (Angus) (SNP)
Mike Amesbury (Weaver Vale) (Lab)
Dame Diana Johnson (Kingston upon Hull North) (Lab)
The Minister for Care (Helen Whately)
I am hugely ambitious about social care reform. I want a sustainable care system that meets people’s needs and aspirations and gives them the care and support they need to live life to the full. We are working on proposals for reform and will bring those forward later this year.
Karl Turner [V]
This Government are responsible for over 40,000 needless deaths from covid-19 in care homes. A plan to fix social care in this country is long overdue. This crisis is not new—people are routinely forced to sell the family home to pay for care. The workers are paid peanuts, while the 13 million unpaid carers are left to pick up the pieces. Does the Minister agree that we have had far too many vague promises and that unpaid carers cannot wait a minute longer?
Helen Whately
I agree with the hon. Member that there are many challenges for social care, and that is one reason why many Governments have talked about social care reform. As he will understand, over the last year, we have rightly focused on supporting social care through the pandemic, but we are working on our proposals for reform and will bring them forward later this year.
Christine Jardine [V]
Almost two years ago, the Government promised to fix social care once and for all, but we have seen in this pandemic that it is still seriously broken. Care does not stop at the hospital exit or the GP’s door. Carers have sacrificed physical and mental health caring for loved ones during the pandemic; 72% have had no break, and 44% say they are at breaking point. In national Carers Week, will the Minister commit to cross-party talks in the immediate term to fix the social care crisis throughout the UK?
Helen Whately
As the hon. Member says, this week is Carers Week, which is a really good opportunity to raise awareness about the important role that carers play in supporting loved ones and to remember something that I personally am committed to: we must support carers not only in the care that they do but to live their own lives, for which respite care is really important. As part of our reforms to social care, we are listening to carers and want to ensure that their needs are met.
Kim Johnson
In July 2019, the Prime Minister stood on the steps of Downing Street and pledged to fix the broken social care system. Two years on, we are still waiting. There were only warm words in the Queen’s Speech a couple of weeks ago:
“Proposals on social care reform will be brought forward.”—[Official Report, House of Lords, 11 May 2021; Vol. 812, c. 2.]
Can the Minister tell us when the Government will move from rhetoric and warm words and fix this broken system for the people she has just mentioned, who need it desperately?
Helen Whately
I welcome the hon. Member’s support for and interest in social care reform, along with others across the House. We know that social care reform is needed. We have rightly over the last year focused on supporting social care through the pandemic, getting £1.8 billion of extra funding for social care to the frontline and providing billions of items of PPE, over 100 million tests to social care and the vaccination programme to care home residents, those who receive social care and the workforce. We are working on our social care reforms and will bring those forward later this year.
Dave Doogan
Many in this place and across England will be asking, “Where is England’s long-awaited social care Bill?” because they will have seen that the SNP Government are delivering a new deal for the social care sector in Scotland, building a new national care service that will improve workers’ conditions and standards of care, and increasing investment in care by 25%. Will the UK Government follow Scotland’s lead in transforming social care, and will the Minister contact Scottish Government Ministers to learn from our over a decade-long experience of integrating health and social care?
Helen Whately
One of the great strengths of our United Kingdom is our ability to work together and learn from different parts of the UK. We also look at the best in England and, of course, in Wales, Scotland and Northern Ireland. The hon. Gentleman mentions the care workforce. We absolutely want to make sure that this important workforce are front and centre of our social care reform plans and that they receive the training, opportunities, recognition and reward that they deserve.
Mike Amesbury
The Government have had 11 years to reform social care, but with cuts of £8 billion over that period, it is fragmented and costly and does not value workers and employees. Is it not time that the Minister and the Government grab the bull by the horns and introduce a national health and social care service? When are reforms going to come into play—what day, what month, what year?
Helen Whately
It is not just over the period mentioned by the hon. Member that social care reforms have been talked about; this goes back at least 25 years, to when Tony Blair was the Labour leader and Prime Minister. He talked about reforms to social care, but he has also said that it is not simple; these are complex problems to address. When people talk about how social care needs fixing, different people mean different things. That is why, as part of our reforms, we are going to bring forward a long-term plan for reforming social care.
Dame Diana Johnson
Can I just say to the Minister that I think most Members of the House of Commons will find her attitude incredibly complacent on one of the key issues that faces most families in this country? As my hon. Friend the Member for Weaver Vale (Mike Amesbury) has just said, there has been an £8 billion cut to social care since 2010. One of the steps she could take straight away is to reinstate that £8 billion to local authorities, so that they can at least provide services through the social care system that we have.
Helen Whately
I have huge respect for the right hon. Lady and her work in many areas, but I am disappointed by her language. She will appreciate that, together, the Department, local authorities and the care sector are working hard on how to bring forward the right package of reforms for the system. We have already taken some of the first steps on that road. For instance, the health and social care Bill includes plans to strengthen oversight of the social care system. That is an important step, but it is the beginning, not the end, of the social care reform road.
Liz Kendall (Leicester West) (Lab)
Six hundred and eighty-five days ago, the Prime Minister promised to fix the crisis in social care to give every older person the dignity and security they deserve. Since then, more than 32,000 elderly people have died from covid-19 in care homes, millions of care workers and families have felt abandoned and pushed to breaking point, and 300 elderly people have been forced to sell their homes to pay for their care every single week. Does the Minister think that has given people security, let alone dignity, and will she tell the country, after more than a decade in power, specifically when her Government will deliver?
Helen Whately
What I will say, after the enormously difficult year that social care has had through the pandemic, is that that has indeed strengthened the already strong case for reform of social care. I will say to the hon. Member that I want us to have a better social care system, whether it is for our grans and grandads, mums and dads, brothers and sisters, children and grandchildren, or, indeed, as and when we need it ourselves. We have a once-in-a-generation opportunity to reform social care. Now is the time, now is the moment and we will seize this opportunity. We will be bringing forward proposals for reform of social care later this year.
Anthony Mangnall (Totnes) (Con)
The Parliamentary Under-Secretary of State for Health and Social Care (Jo Churchill)
My ministerial colleagues and I are in regular contact with the Food Standards Agency on matters of common concern.
Anthony Mangnall
Next week the Food Standards Agency will produce its annual report and hold its annual general meeting. That report is likely to recommend significant changes regarding live bivalve molluscs, which have a huge impact on my constituency and on the health of the nation for those who eat seafood. Will the Minister commit that any changes recommended in the report next week will be brought forward in record time, so that they may be implemented quickly and we can secure the future of the seafood industry in the United Kingdom?
Jo Churchill
It is a change to be talking about a different sort of mussel in this place during Health questions. The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Banbury (Victoria Prentis) and I are well aware of the challenges that currently face the shellfish industry, and I thank my hon. Friend the Member for Totnes (Anthony Mangnall) for his dogged determination, especially on behalf of those businesses that rely on exports. We will continue to work closely with the FSA, which I know has been working hard to resolve these issues and make progress. I have been advised that there is potential for change to ensure that classifications are awarded in a proportionate and pragmatic way, while continuing to ensure high levels of public health protection. I assure my hon. Friend that I will continue to work closely with the FSA and with my colleagues in DEFRA.
Chris Loder (West Dorset) (Con)
The Minister for Health (Edward Argar)
I am grateful to my hon. Friend, not least for providing me with my only opportunity to answer a question on the Order Paper today. I am delighted to confirm that St Ann’s Hospital in Dorset is already part of our plan to build 48 hospitals by 2030—the biggest hospital building programme in a generation. The new build at St Ann’s will provide child and adult mental health services for the people of Dorset, resulting in outdated infrastructure being replaced by facilities for staff and patients that are at the cutting edge of modern technology, innovation and sustainability, driving excellence in this hugely important area of patient care.
Chris Loder
I thank the Minister for his hard work in reopening the Yeatman Hospital in Sherborne, which will happen in a couple of weeks for A&E. On top of what he has already offered, which I very much appreciate, will he commit specifically to increase inpatient provision for children and young people in West Dorset with severe mental health difficulties, as we have a number of difficult cases?
Edward Argar
My hon. Friend takes a great interest in these matters and, as he will know, the number of places commissioned is a matter for NHS commissioners locally. I reassure him that we can commit, and my hon. Friend the Minister for mental health services is committed, to expanding and transforming community mental health services across England, boosted by an additional £79 million this year, so that children and young people get timely access to the support and treatment they need, without having to be admitted to hospital. That is, of course, alongside the investment to which I have referred for inpatient mental health facilities at St Ann’s.
Ian Levy (Blyth Valley) (Con)
Damian Hinds (East Hampshire) (Con)
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
The Minister for Patient Safety, Suicide Prevention and Mental Health (Ms Nadine Dorries)
We are transforming mental health services through the NHS long-term plan, investing an additional £2.3 billion a year by 2023-24. Where national waiting time targets exits, the majority are being met. Targets for eating disorder services are sadly not being met, but additional resources have been allocated to increase capacity and address waiting times. We are working on the consultation responses for the Mental Health Act White Paper, and we will bring legislation forward when parliamentary time allows.
Ian Levy
After a career working in mental health for almost 30 years, prior to entering this House, I was delighted to be asked to become a board member for a local charity, Anxious Minds, which is based in Blyth town centre. Its aim is to improve mental health and wellbeing for local people. Will my hon. Friend assure me and those who worry about the toll that this pandemic has taken on the vulnerable that she will do everything she can to ensure that mental health is given the highest possible propriety as restrictions begin to ease?
Ms Dorries
I thank my hon. Friend for his years of service working in mental health. Mental health is one of this Government’s top priorities, and I assure him that we are doing our utmost to ensure that mental health services are there for everyone who needs them. Through the NHS long-term plan, we are expanding and transforming mental health services in England and investing an additional £2.3 billion a year in mental health services by 2023-24.
In addition, we have published our mental health recovery action plan, backed by a one-off targeted investment of £500 million in addition to the £2.3 billion, to ensure that we have the right support in place this year. The plan aims to respond to the impact of the pandemic on the mental health of the public, specifically targeting groups that have been most impacted. We have set up a cross-Government ministerial group to monitor progress against the actions listed in the plan, and the group will also identify areas for further action and collaboration.
Damian Hinds
I welcome the priority put on young people’s mental health, which is perhaps more important now than ever. Will the Minister give an update on progress on implementing the proposals in the children and young people’s mental health Green Paper, particularly on mental health support teams in Hampshire and nationwide?
Ms Dorries
We are making good progress on implementing the Green Paper proposals, and I am pleased to say that we have established 11 mental health support teams in Hampshire. Nationwide, there are currently 180 mental health support teams, covering around 15% of pupils in England. Over 200 more are in training or being commissioned, and we expect to have around 400 in place by 2023-24, covering 35% of pupils. We recently announced £9.5 million to train thousands of senior mental health leads among school and college staff.
Lloyd Russell-Moyle
Last year, in my NHS trust 37% of children referred to mental health services were turned away. That was up from 28% the year before. That is 2,649 children not getting treatment despite referrals from professionals. That will be exacerbated, of course, by the acute children’s mental health unit at Ticehurst being shut and no new hospital provision commissioned.
It is not just Sussex Partnership NHS Foundation Trust that is failing; it is services across the country. In 2019, 140,000 children were turned away from child and adolescent mental health services, and some experience exceptionally long waits. Is the Minister comfortable with these huge numbers of children being turned away from treatment? Does she think that these waiting times are acceptable? What message does she have for those children and families who do not receive the treatment that they desperately need?
Ms Dorries
The short answer to that question is no, and that is why we have committed an additional £500 million to address some of the issues that the hon. Gentleman highlights. However, I must reiterate that the majority of our targets, where they have been set, are being met. Sadly, in eating disorders—I hold my hands up—we are not meeting the targets that we want to, but as he may be aware, we are trialling four-week waiting targets for children and young people. The results of that review and pilot will be available soon.
We continue to look at ways in which we can increase access to services for children and young people. Children and young people have told me themselves, via organisations such as Barnardo’s, that they want their mental health services delivered in a different way. They do not want to go and sit in a village hall or a hospital, or wherever they may receive their services from community practitioners; they want some of their services delivered via their phones, laptops or computers. Obviously, one-to-one services have to be available where they are needed, but children and young people are demanding a change, and we are going through that change now.
Dr Rosena Allin-Khan (Tooting) (Lab)
My hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) raises a very important point and, frankly, I am shocked that the Minister seems so relaxed about it. Across the country, there are numerous children who have waited more than 400 days for help with autism; 280 days for post-traumatic stress disorder; 217 days for suicidal ideation; 195 days for treatment after an overdose—I could go on and on. Children should not have to wait so long for treatment. That will have a scarring impact on their development. These waiting times simply are not acceptable, so will the Minister apologise to these children, and can she explain where it went so wrong?
Ms Dorries
I do not believe that meeting almost all our targets for NHS waiting times for mental health services, with £2.3 billion a year of investment into our NHS and no NHS mental health service closing during the entire pandemic, has been a failure. Of course I am sorry for those children and young people who cannot get access to services as quickly as they want; that is exactly why we committed an additional £500 million and established a mental health recovery plan: so that we can put community services in place to reach those who have been impacted most by the pandemic over the past 15 months. We have a long-term plan in place, with the investment that the NHS tells us that that long-term plan needs to provide the very services that we want to provide. The mental health of children and young people is this Government’s priority. We will continue to invest, and are proving to continue to invest, to make sure that those children and young people access the services they need.
Robert Largan (High Peak) (Con)
David Johnston (Wantage) (Con)
Paul Howell (Sedgefield) (Con)
The Parliamentary Under-Secretary of State for Health and Social Care (Jo Churchill)
General practice has remained open throughout the pandemic, offering face-to-face appointments as well as telephone and online consultations, while playing a leading role in our vaccination programme. We are enormously grateful to general practices, the GPs and their broader teams for everything that they have done, but to ensure that general practice can continue to provide all necessary and appropriate care during this very busy time, we have made an additional £270 million available until September.
Robert Largan
If it is done right, we can use technology and data to improve healthcare services, improve patient outcomes and help to save lives, so I welcome the proposals for a new GP data system, but it is vital that we get this right with the appropriate protections in place. With that in mind, will the Minister update the House on these vital reforms?
Jo Churchill
I could not agree more. Data saves lives —it is as simple as that. We have seen that in the pandemic, and it is one of the lessons of the vaccine roll-out. The GP data programme will strengthen the system and save lives. Patient data is, of course, owned by the patient. We are absolutely determined to take people with us on this journey. We have therefore decided that we will proceed with the important programme, but we will take some extra time, as we have conversed with stakeholders over the past couple of days. The implementation date will now be 1 September. We will use this time to talk to patients, doctors, health charities and others to strengthen the plan, build a trusted research environment and ensure that data is accessed securely. This agenda is so important, because we all know that data saves lives.
David Johnston
I have been contacted in recent weeks by quite a number of constituents who are struggling to get a GP appointment, but we have a pre-covid problem as well, which is that thousands and thousands of new houses have gone into the constituency without an increase in GP services. Will my hon. Friend meet me to discuss how to get my constituents the GP services that they need and deserve?
Jo Churchill
It is right that local health commissioners pay careful regard to the impact of new housing and growing areas, which is to be welcomed. I understand that both practices in my hon. Friend’s area are still accepting patients and that the Oxfordshire clinical commissioning group has been working closely with the practices in Wantage to make sure that the impact of housing growth is being accommodated, which I expect all CCGs and councils to be doing. I would be happy to meet my hon. Friend to discuss the matter further.
Paul Howell
I recently met two cancer groups in Sedgefield, the Solan Connor Fawcett Family Cancer Trust and the Great Aycliffe Cancer Support Group, and heard about the wonderful work that they have been doing over the past year. We also discussed how delayed GP appointments have affected early diagnosis of important medical issues such as cancer. Early diagnosis is necessary to provide patients with the best chance of stopping the cancer spreading and of recovering. Furthermore, the later cancer is caught, the more complicated cases become; they take more time and more resources and, of course, are horribly distressing. Will the Minister please tell me what is being done to ensure that backlogs in appointments are being addressed as urgently as possible?
Jo Churchill
I pay tribute to all the cancer charities out there who have done sterling work during the pandemic. As I have said, GP services are open, and they are offering different forms of communication with patients. We are running the Help Us, Help You campaign so that people can come forward when they have symptoms. As my hon. Friend says, identifying cancers early to save lives is part of the long-term plan, but I would like to assure him that my latest data showed that in March 2021 we had the highest ever recorded number of GP referrals for cancer. GPs are working really hard, and if patients are worried about any symptoms, they need to come forward.
Alex Norris (Nottingham North) (Lab/Co-op)
For GPs and for the NHS more broadly, using data effectively is an important way to restore our health services. However, the current plans to take this data from GPs, assemble it in one place and sell it to unknown commercial interests for purposes unknown has no legitimacy whatsoever. There has been no public engagement and no explanation; this has simply been snuck out under the cover of darkness—[Interruption.] I will get there, Minister; do not worry. This is an NHS data grab. The news of the delay is welcome and I am glad that the hon. Lady has made that commitment, but within that, will she commit to ensuring that the 23 June opt-out date is also moved to 1 September and that there will be a full public consultation on whether people want their data used for these purposes?
Jo Churchill
I refer the hon. Gentleman to the answer I gave earlier to my hon. Friend the Member for High Peak (Robert Largan). We will be considering everything in the round. As I have said, I have spoken to many of the stakeholders involved and as we move forward we will be ensuring that we take all trusted individuals with us to build confidence in the system.
Dan Jarvis (Barnsley Central) (Lab)
The Minister for Care (Helen Whately)
The organ donation opt-out system has increased the number of organs available for transplant and is saving hundreds of lives. Since the law changed last year, 296 people in England have donated their organs under the opt-out system. These donations account for 29% of the 1,021 donations that took place last year.
Dan Jarvis [V]
I am grateful to the Minister for that response. She will know that 20 May marked one year since Max and Keira’s law came into effect—a change that will give hope and save lives—but despite the tireless efforts of NHS staff, covid has had a devastating impact on patients in need of life-saving operations. Can the Minister outline how she is going to get organ transplant services back to pre-pandemic levels and tell us what additional resources will be committed in order to support an increase in organ availability?
Helen Whately
I would first like to thank the hon. Member for the part he played in campaigning for this life-saving change to organ donation and bringing about the increase that I mentioned earlier. The current services are now running at pre-covid levels and NHS Blood and Transplant is working with the wider healthcare system to enable as many transplants as possible. The new Organ Donation and Transplantation 2030: Meeting the Need strategy, which was launched last Tuesday, sets out the steps we are taking to increase organ availability further.
Ronnie Cowan (Inverclyde) (SNP)
The Parliamentary Under-Secretary of State for Health and Social Care (Jo Churchill)
I have discussed these concerns with the hon. Member and with the co-chairs of the all-party parliamentary group on medical cannabis under prescription, and he knows that I sympathise deeply with the parents of these children and with the patients and their families, many of whom I have met. They are dealing courageously with conditions that are difficult to treat. My immediate priority was to resolve the supply of Bedrocan oil from the Netherlands. I have further meetings planned to make progress on other issues in this incredibly complex situation.
Ronnie Cowan [V]
I welcome today’s letter from the Minister detailing the extension of the arrangements for the provision of Bedrocan, and I am pleased that we are working towards the manufacture of Bedrocan oils in the UK. I have two issues today. The first is that patients still need to pay for their medicines. If the numbers are so small and this is such a niche product, surely it could be provided free on the NHS. Secondly, I have been told that research is ongoing regarding the wider possibilities for medical cannabis, but despite being promised an update a month ago, I am still waiting for one from the Medicines and Healthcare Products Regulatory Agency on clinical trials and the licence application. Could that please be forthcoming?
Jo Churchill
As the hon. Gentleman knows, I have met Dr June Raine from the MHRA and subsequently met further specialist clinicians in this area to discuss progress with the research and evidence on supporting prescribing on the NHS. Establishing clinical trials is vital, with the support of the National Institute for Health Research, to make sure that we are making the right decisions on routine funding. From 1 April, we have introduced a national patient registry to record data and monitor patient outcomes in England, with a view to it being rolled out across Scotland and the other devolved Administrations later this year; this covers both licensed and unlicensed cannabis-based medicines on the NHS, with a view to including private patients in due course. As he knows, I am very focused on making sure we get the right solutions for families, but at the heart of this matter always has to lie the safety of what we prescribe.
Mr Speaker
Question 24 about covid-19 variants has been withdrawn, but if the Minister can give a response, we can go to Justin Madders for his supplementary question.
The Parliamentary Under-Secretary of State for Health and Social Care (Jo Churchill)
The Government have produced a four-step road map to ease restrictions across England. Before each step, an assessment is made against the four tests, including assessing the current risk posed by variants of concern. The move to step 3 on 17 May was based on the assessment that the risks were not fundamentally changed by those variants of concern. Step 4 is due no earlier than 21 June and the variants of concern will again be considered in advance.
Justin Madders
On Sky News, on Sunday, the Secretary of State was asked about figures that contradict his claim that India was not put on the red list at the same time as Bangladesh and Pakistan because positivity rates were three times higher in those countries. In response, he said that he did not recognise those figures, but he should have done, because they are his own figures from Test and Trace. Indeed, there are no published figures for the time the decision was made that support his claim. Given the allegation that the only reason there was a delay in putting India on the red list was to help secure a trade deal, and given that this delay is now having serious consequences, will the Minister agree to publish all the data and advice on which the decision was based, in the interests of transparency and accountability?
Jo Churchill
The positivity rates were three times higher from Pakistan than they were from India when we made that decision. As the hon. Gentleman knows, we keep these things under constant review and we would be equally lambasted if decisions were made before we had the correct information. Acting when we have the right information on variants of concern is an important thing; we will keep following the data.
Mr Peter Bone (Wellingborough) (Con)
The Secretary of State for Health and Social Care (Matt Hancock)
In October, the Prime Minister confirmed a £3.7 billion funding allocation over the next four years to support the delivery of 40 new hospitals by 2030, and I am delighted that that includes Kettering General Hospital. We have since confirmed that there will be 48 new hospitals built by 2030, and six of those projects are under way.
Mr Bone
I am delighted that one of the new Boris hospitals will be built on the site of Kettering General, starting with an accident and emergency department and with the whole hospital being finished by 2027. Unfortunately, there may well be a substantial delay to that because of red tape and bureaucracy. Will the Secretary of State use his great skills, bang some heads together, and get the pen-pushers and accountants to sort out the delay so that we can get on with this? Will he be kind enough to meet the three hon. Members who represent north Northamptonshire to discuss the issue?
Matt Hancock
Nothing gives me greater pleasure than making stuff happen, so I would be very happy to meet my hon. Friend and the nearby colleagues who represent the people served by Kettering General Hospital to make sure we can get this project moving as soon as we can.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
The Minister for Patient Safety, Suicide Prevention and Mental Health (Ms Nadine Dorries)
Work on the scope and organisation design of the Office for Health Promotion is ongoing. We will present more detail on our plans for the OHP in due course. Public Health England’s “Better Health—Every Mind Matters” social marketing campaign aims to inform and equip the public to look after their mental health. Its NHS-endorsed website offers guidance on the actions that people can take to improve their mental wellbeing, including by practising mindfulness and reflection.
Margaret Ferrier [V]
Research shows that mindfulness training can contribute to improvements in obesity, eating behaviours, addiction and mental health and wellbeing. Will the Minister ensure that the Office for Health Promotion looks at the evidence of how mindfulness can help with how we all manage our health?
Ms Dorries
There is emerging evidence on the mental health benefits of mindfulness, which can take the form of meditation or wider approaches that incorporate a mindful approach. As the hon. Lady may be aware, I have been particularly concerned that we separate out mental illness and wellbeing and mindfulness. We should focus on mental illness, which needs intense clinical intervention in NHS services, but also look at mindfulness and wellbeing. That is why I mentioned “Every Mind Matters”: the facilities are there.
Mr Laurence Robertson (Tewkesbury) (Con)
The Parliamentary Under-Secretary of State for Health and Social Care (Jo Churchill)
The pandemic has proven to the public how vital our highly skilled pharmacy teams are in supporting their communities. Pharmacies have massive potential to build on the new services they are already delivering, and we will continue to look at how we can use them further.
Mr Robertson
I thank the Minister for that answer. Can we also make sure that the public are aware of everything that pharmacies can do, so that they can use them to take pressure off GPs?
Jo Churchill
Indeed we can. I would be honoured to work with my hon. Friend to do that so that people think “pharmacy first”. Pharmacies are delivering lateral flow devices into our communities; 500 of them have stood up to be vaccination sites; and we can now refer from NHS 111 and GPs into community pharmacies for the supply of prescribed medicine and for minor illnesses. We need our pharmacies to show their skill base; they are a highly skilled group that we should all be asking to do more and celebrating.
Dr Jamie Wallis (Bridgend) (Con)
The Secretary of State for Health and Social Care (Matt Hancock)
I can tell the House that today, working with local authorities, we are providing a strengthened package of support, based on what is working in Bolton, to help Greater Manchester and Lancashire to tackle the rise in the delta variant that we are seeing there. The support includes rapid response teams, putting in extra testing, military support and supervised in-school testing. I encourage everyone in Manchester and Lancashire to get the tests on offer. We know that this approach can work: we have seen it work in south London and in Bolton, stopping a rise in the number of cases. This is the next stage of tackling the pandemic in Manchester and Lancashire. It is of course vital that people in those areas, as everywhere else, come forward and get the jab as soon as they are eligible, because that is our way out of this pandemic together.
Dr Wallis
Currently, all primary care providers in Wales remain on amber alert, which means that many of my constituents in Bridgend are unable to access necessary services unless it is an emergency. Will my right hon. Friend explain how this situation compares to his Department’s strategy to provide catch-up services as we come out of lockdown?
Matt Hancock
It is very important that, across the country, the UK is open, the NHS is open and that people can come forward and get treatment if they need it. As my hon. Friend knows, I work closely with the delivery of the NHS in Wales. The NHS there is of course the responsibility of the devolved Administration, but I am happy to take up his concern with the new Welsh Minister for Health and Social Services to see what we can do.
Jonathan Ashworth (Leicester South) (Lab/Co-op)
We have seen reports today of how exhausted NHS staff are. The Secretary of State for Environment, Food and Rural Affairs said in the media this morning that he was not sure what more the Government could do to support NHS staff. Obviously, the Government could give them a pay rise, but will the Secretary of State for Health and Social Care also commit today to extending free hospital car parking for NHS staff beyond the pandemic?
Matt Hancock
Of course, we have made hospital car parking free for staff during the pandemic. That is one of the many, many things that we have put in place to support staff. Staff wellbeing support and mental health support have also been incredibly important, learning, as we have done, from the support that we give to others in public service who go through traumatic episodes. The right hon. Gentleman is quite right that there is a wide array of things that we need to do to support NHS staff on the frontline.
Jonathan Ashworth
I wanted a commitment to extend the relief of hospital car parking charges beyond the pandemic.
The Secretary of State knows that waiting lists are at 5 million and that 432,000 people are waiting beyond 12 months. Once we are through this pandemic, the priority must be to bring those waiting lists down, but he is about to embark on a reorganisation of the NHS with his integrated care legislation. Local boards permit the private sector to have a seat on them. Virgin Care has just been given a seat on the integrated care system in Bath and North Somerset. He once promised that there would be no privatisation on his watch, so will he instruct that ICS to remove Virgin Care from its board?
Matt Hancock
The right hon. Gentleman is absolutely right that integrating the health service with services provided by local authorities, such as social care, is absolutely critical, and I know that he supports those proposals that have come from the NHS. When it comes to delivering services in the NHS, what matters to patients is that they get high-quality services, for instance, to deal with the backlog, and what matters is getting those services as fast as we possibly can. People care much less about who provides the service than they do about the service getting delivered, and that is the approach that I take, too.
Jeremy Hunt (South West Surrey) (Con)
Today, the Health and Social Care Committee published its report on NHS and social care staff burnout, which chronicles the emotional exhaustion and chronic fatigue felt by many frontline staff in the past year. Much support has been put in place; the 50,000 nurse target is welcome, the extra doctors and nurses hired during the pandemic extremely welcome, but still we have shortages in nearly every specialty, leading to a sense of despair. Will my right hon. Friend consider the recommendation that we make today that Health Education England should be given the statutory power to make independent workforce projections, rather as the Office for Budget Responsibility does for Budget forecasts, so that we can at least look doctors and nurses in the eye and say that we are training enough of them for the future?
Matt Hancock
I am very happy to work with the Select Committee on the forthcoming health and care Bill. The Committee has already had a huge amount of input into that Bill, and I am sure that, during its passage, we will be working together on making sure that this piece of legislation, which has cross-party support, can come through the House in the best possible state. I am very happy to look at the specific proposal, but what I would say is that we have been recruiting record numbers of doctors and nurses to try to make sure that the NHS is always there for all of our constituents and their families.
Kirsten Oswald (East Renfrewshire) (SNP)
Matt Hancock
We made very significant progress on this in the Budget immediately following the general election, as the hon. Lady will know. That has removed this problem for the vast majority of doctors who serve in the NHS. I am very glad that we were able to make that progress. I am always happy to look at suggestions from the unions and others, but I am glad to say that we have made a good deal of progress on this one.
Mark Eastwood (Dewsbury) (Con)
The Minister for Covid Vaccine Deployment (Nadhim Zahawi)
I join my hon. Friend in congratulating the whole team on the incredible work that they did in pretty difficult and urgent circumstances. I reassure him that, as the Prime Minister has said and as the Secretary of State has said from the Dispatch Box, we want the whole country to come out of this lockdown together.
Mr Virendra Sharma (Ealing, Southall) (Lab) [V]
Robbie Moore (Keighley) (Con)
Matt Hancock
Mr Speaker, not only has my hon. Friend made a compelling case for me to visit, but you have just told me to visit, so I have my marching orders. I look forward to my now forthcoming visit to Airedale hospital. I have not been yet, so I am very keen to come.
The Minister of State responsible for the hospital building programme has been heavily involved, and I have been looking at the paperwork. As my hon. Friend knows, on top of the 40 hospitals we announced—six of which are already being built—we have eight further slots to come, and Airedale hospital is very much on my radar for those slots. We will run an open competition and will make sure it is fair, but I will certainly visit.
Stella Creasy (Walthamstow) (Lab/Co-op) [V]
Matt Hancock
Yes, I will ensure that the Minister of State takes a meeting with the hon. Lady.
Nickie Aiken (Cities of London and Westminster) (Con)
Matt Hancock
Yes, absolutely, I 100% agree with my hon. Friend. We have the funding to expand that programme. She will have seen in our national genomics healthcare strategy that newborn screening is specifically highlighted. It is a personal mission of mine to make that happen. I am happy to meet her and Baroness Blackwood, the chair of Genomics England, who has been driving the project forward.
Abena Oppong-Asare (Erith and Thamesmead) (Lab)
Matt Hancock
Yes. The hon. Lady raises a very important issue, and if she writes to me with the full details, we will get right on it.
Caroline Ansell (Eastbourne) (Con) [V]
The Minister for Care (Helen Whately)
My hon. Friend makes a really important point. Nurse education standards are set by the Nursing and Midwifery Council. Its current standards are based on EU law, but that no longer applies to the UK, and it has launched a survey on whether those standards should change. Acceptances for pre-registration nursing programmes at English universities for 2020-21 increased by over 5,000 since the previous year.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Matt Hancock
The hon. Lady is quite right, and if she was in the Chamber earlier, she would have heard the Under-Secretary of State, my hon. Friend the Member for Bury St Edmunds (Jo Churchill), say that we are going to delay the deadline for this programme, including the opt-out, which is currently scheduled to end on 23 June. That has already been welcomed, while we have been in here, by the Royal College of General Practitioners and the British Medical Association, and then we will work through these issues. Everybody agrees that data saves lives. We have to make progress in this area, and it is very important that we do it in a way that brings people with us and resolves exactly the sorts of issues that she raises.
Jason McCartney (Colne Valley) (Con)
Matt Hancock
I am really glad to say that in Bolton and other parts of the country where we have sent in a big package of support, including surge testing—as we have done in Kirklees—we have seen a capping-out of the increase in rates without a local lockdown thanks to the enthusiasm of people locally and, of course, the vaccination programme. That is our goal. Our goal is that England moves together. That is what we are putting these programmes in place to do, and we are seeing them work.
Gareth Thomas (Harrow West) (Lab/Co-op)
Greg Smith (Buckingham) (Con)
Matt Hancock
Recovering the backlog that has been caused by the pandemic is a huge task for the NHS, and was raised by the right hon. Member for Leicester South (Jonathan Ashworth) from the Opposition Front Bench, quite rightly. The backlog has unfortunately been increased as a consequence of the pandemic. We have put in extra money—an extra £1 billion this year—and we are seeing cancer services running at 100% of their pre-pandemic levels, and in some cases above 100%, in order to get through the backlog. The most important thing for the public watching this and for my hon. Friend’s constituents is to make sure the message gets out loud and clear that the NHS is open, and that if they have a problem, they should please come forward.
Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)
Matt Hancock
That is not something that has yet come across my desk, but I will make sure that the relevant Minister writes to the hon. Gentleman with as much detail as we know.
Paul Maynard (Blackpool North and Cleveleys) (Con)
Matt Hancock
What my hon. Friend says is absolutely right. Of course if someone puts a defibrillator on private land, access to it should naturally be open to anybody who needs it. I will look into the exact legal status, but let us set aside the legal status for a minute. If there is a defibrillator on private land that could save somebody’s life, the landowner should of course allow access to it for anybody who needs it.
Jessica Morden (Newport East) (Lab)
As current Government investment in motor neurone research is not the targeted funding that is needed, will the Minister meet charities, researchers and patients to examine this discrepancy and commit to additional funding of £10 million a year for five years for a virtual motor neurone disease research institute, with a specific focus on helping us to get a world free of MND?
Helen Whately
I will look into the hon. Lady’s specific request, but I can tell her that the Government are actively supporting research into motor neurone disease. For instance, in April I jointly hosted a roundtable event on boosting MND research with the National Institute for Health Research/Sheffield Biomedical Research Centre, which brought together researchers and others. We are absolutely committed to this area of work.
Mr Mark Harper (Forest of Dean) (Con)
Mr Speaker, I am very grateful that you could fit me in at the end.
Yesterday during the statement the Secretary of State did not have the information to hand on the efficacy of the covid vaccines in reducing serious disease and hospitalisation. He made a commitment, rightly, to set them out today at Health questions at the Dispatch Box; and I am delighted, with this question, to give him the opportunity to do so.
Matt Hancock
First, I can say that a single dose of the Pfizer or AstraZeneca jab offers protection of 75% to 85% against hospitalisation, while data on two doses, which is currently available only for Pfizer, indicates 90% to 95% effectiveness against hospitalisation and 95% to 99% effectiveness at preventing death. However, my right hon. Friend also asked specifically about the delta variant, and I said that I did not have the figure in my head for the reduction in hospitalisations. I do not know whether I should be glad, but I can report to him that the reason is that there is not yet a conclusive figure. This morning I spoke to Dr Mary Ramsay, who runs this research at Public Health England, and she told me that the figure is currently being worked on. The analysis is being done scientifically and should be available in the coming couple of weeks. This is obviously an absolutely critical figure and I will report it to the House as soon as we have it.
Mr Speaker
I will now suspend the House for a few minutes to enable the necessary arrangements to be made for the next business.
Ajax Programme
(3 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
John Healey (Wentworth and Dearne) (Lab)
(Urgent question): To ask the Secretary of State for Defence if he will make a statement on what progress has been made with the Ajax armoured vehicles programme.
The Minister for Defence Procurement (Jeremy Quin)
The Ajax family of vehicles will transform the British Army’s reconnaissance capability. As our first fully digitalised armoured fighting vehicle, Ajax will provide crews with access to vastly improved sensors, and better lethality and protection. Maingate 1 approval was granted in March 2010. Negotiations with the prime contractor to recast the contract were held between December 2018 and May 2019. The forecast initial operating capability, or IOC, was delayed by a year to 30 June 2021—later this month—at 50% confidence, with 90% confidence for September 2021.
Despite the ongoing impact of covid, we have stuck by that IOC date, but of course, it remains subject to review. By the end of next week, we will have received the requisite number of vehicles to meet IOC. The necessary simulators have been delivered and training courses commenced. These delivered vehicles are all at capability drop 1 standard, designed for the experimentation, training and familiarisation of those crews that are first in line for the vehicles. Capability drop 3, applying the lessons of the demonstration phrase, is designed for operations.
We remain in the demonstration phase, and as with all such phases, issues with the vehicle have emerged that we need to resolve. We were concerned by reports of noise issues in the vehicle. All personnel who may have been exposed to excessive noise have been tested, and training was paused. It now continues with mitigations in place as we pursue resolution. We have also commissioned independent vibration trials from world-class specialists at Millbrook Proving Ground, which should conclude next month.
I assure the House that we will not accept a vehicle that falls short of our requirements, and we are working with General Dynamics, the prime contractor, to achieve IOC. Similarly, we are currently working with General Dynamics to ensure that we have a mutually agreed schedule for reaching full operating capability. That is subject to an independent review, which we have commissioned. This is an important project for the British Army, delivering impressive capabilities and employing thousands of skills workers across the UK. We look forward to taking it into service.
John Healey
That was a statement of astonishing complacency. We have seen £3.5 billion paid out, four years late, and just 14 vehicles delivered, light tanks that cannot fire while moving, and vehicle crews made so sick that the testing has been paused. If this is defence procurement that the Minister is content is broadly on track, how badly has it got to go wrong before he will admit that the contract is flawed? This project has been flagged red by the Government’s own Major Projects Authority. The Defence Committee calls it
“another example of chronic mismanagement by the Ministry of Defence and its shaky procurement apparatus.”
Yet the Defence Secretary is failing to get to grips with the failures in this system and failing our frontline troops as a result. He is breaking a promise he made to them in this House when he said:
“When it comes to equipment, the first thing is to ensure that we give our men and women the best to keep them alive and safe on a battlefield.”—[Official Report, 7 December 2020; Vol. 685, c. 556.]
He has been in post for two years now. Since then, the black hole in the defence budget has ballooned by £4 billion up to £17 billion. Ministers are failing British forces and failing British taxpayers.
Have the Ajax problems of noise and vibration now all been fully fixed? How many personnel are under medical treatment following the Ajax testing, and what are the conditions they are being treated for? Can the Ajax now in fact fire while moving? Where will the gun turret be manufactured? What is the full updated cost of the Ajax programme? When will all these vehicles be delivered in full?
This is the largest single procurement contract outside nuclear, and it requires independent scrutiny, so will the Minister invite the National Audit Office to do an urgent special audit?
The Minister says that this is an important project for the British Army. He is right. The defence Command Paper makes it clear that the rapid further cut in Army numbers is directly linked to more advanced battlefield technology based on the Ajax. So will Ministers now halt the plans to cut Army numbers and focus instead on fixing this failing procurement system?
Jeremy Quin
I had imagined that whatever my response, the right hon. Gentleman would accuse me of being complacent. That is the expectation I had and I was not disappointed. We are not in any way complacent about our nation’s defence and security. That is why we are investing another £24 billion in our defence and in our security over the next four years. We are absolutely on top of and getting to grips with our equipment programme and what will stem from it.
The right hon. Gentleman raised a number of issues. I can assure him that I am absolutely focused on this project achieving its IOC. I will not hide from him, as I have not from the House, that we have two primary concerns: noise and vibration. On noise, we have mitigations currently in place to enable a certain element of training, albeit reduced training. We are looking at two headsets that hopefully, within the next few weeks, will be approved for use, further extending what we can do in terms of training. But that does not get us to the root cause of the noise. We need to get to the root cause of the noise issues within this vehicle, be they mechanical or indeed electronic; this is, after all, the first digitalised platform of its kind anywhere. We need to resolve those issues.
We are concerned about vibration. I have to say that over many thousands of miles of testing GD has not had the same experience of vibration, but I absolutely trust the reports that have come to me from our service personnel. We are determined to get to the bottom of this. That is why we are using Millbrook, a world-class proving ground, to check exactly what noise comes back on vibration. It may come back with a good answer, but we await that answer. I can assure the right hon. Gentleman —I understand his concerns—that we will not take anything into IOC until we are satisfied that we are getting the kit that we require.
I can reassure the right hon. Gentleman on a host of other issues that he raised. I do not deny that we have serious issues that we need to resolve, but there are a number of points where there is a difference between what is certified and what the vehicle is capable of. I can reassure him that the vehicle is capable of going well ahead of 30 km per hour, but with newly trained crews, a certification has been placed restricting speed, and I would expect that to be lifted during the course of next month. There has been a restriction in terms of going up over a reverse step. This is a vehicle that is capable of reversing over a 75 cm object. A restriction has been placed, and I expect that to be lifted shortly too. This is a vehicle that is capable of firing on the move. That is not something that we have certified it to do as yet. We are working through the demonstration phase, but we will continue to advance that demonstration phase. There will be issues; there always are in demonstration phases.
We do have issues to resolve, but as I say, the key ones are noise and vibration, both of which we are very focused on. I hope that we will be able to get resolution on all these issues, but it is what we are working with, with General Dynamics. It is a firm price contract, so £5.5 billion is the maximum that is payable, including VAT. Currently, we are at just under £3.2 billion spent. There is a heavy incentivisation on our suppliers to ensure that they get this over the line. We are working very closely with them at the very top level of their organisation. The joint programme office was delayed by covid, as the right hon. Gentleman will be aware. There were significant covid issues in Merthyr, and they did brilliantly through them. We have a joint programme office on the ground, and a combination of top-down and bottom-up will, I hope, enable us to make ongoing progress.
In terms of the reporting, as the right hon. Gentleman may be aware, an Infrastructure and Projects Authority report has been requested by the senior responsible owner, which was helpful. These things are helpful. It is helpful that SROs and their teams can speak honestly to the IPA and get proper independent assessments. That was conducted back in March, and it has certainly helped. I look forward to making further progress and reporting back on that to interested parties as we resolve the issues that are outstanding.
I reiterate that this is a first-class vehicle. It is the first of its kind. It has an important job to do. It is currently employing around 4,100 people across the length and breadth of the UK. I visited Merthyr, and I am proud of what they are doing there. We will, and we must, get this right and get it delivered.
Mr Tobias Ellwood (Bournemouth East) (Con)
For some time, I have been warning the House about the growing, complex threats that our nation faces. Over the next decade, the world will become more unstable and more dangerous. That is why I have argued for an increase of the defence budget to 3%, to meet the integrated review obligations, but it makes the job harder of convincing the Treasury, Parliament and the taxpayer when we see so many errors, delays, cost overruns and redesigns.
The Ajax’s predecessor, the Scimitar, weighed just 8 tonnes, yet Ajax weighs 43 tonnes—almost too heavy to fit in or be carried by many of our RAF aircraft. As the Defence Committee’s report underlines, there seems little operational logic to the Army’s land combat operational capabilities. We are reducing our main battle tank fleet. We are retiring all our armoured fighting vehicles completely and replacing the Warrior with the Boxer, which does not have a turret. I know that the Minister is committed to revisiting all this, and it is a massive headache, but with global threats on the increase, does he acknowledge that we must do better?
Jeremy Quin
There is always room to do better—I totally acknowledge that, and I thank the Chairman of the Select Committee for his comments. It may not be 3%, but a £24 billion increase is certainly good news for defence and something that was necessary. I can assure him that we are focusing on spending that well and in the interests of our armed forces.
The Ajax is going to be a real game changer on the battlefield. It is larger—it is some 40 tonnes—and Scimitar was a different capability, but my right hon. Friend would be the first to say that things have moved on. There is the range of sensors and the four dimensions that Ajax can produce, allowing it to stand off from the enemy. It is a significant sea change. It has that extra lethality compared with what went before and the extra protection that our troops deserve. This is a vehicle that has an incredibly useful role to play on the battlefield and as part of our operational advantage. The emphasis on our suppliers is to get it right.
Dave Doogan (Angus) (SNP)
There is in the UK no shortage of MOD procurement debacles to draw on, such as the £4 billion Nimrod MRA4 scrapped before service or the Mk 3 Chinooks—half a billion pounds of aircraft that could not fly low or in bad weather—but this multibillion-pound Ajax failure sets a new low. The UK Government have presided over a procurement project that would see soldiers arriving late for operations in vehicles only capable of a pedestrian 20 mph, with a human endurance range of no further than 30 miles, and then unable to fight duty due to sensory impairment and pain caused by these £3.5 billion boneshakers. Can the Minister confirm that the sight system manufactured by Thales in Scotland is working perfectly and is unconnected with this broader failure? Where was the intelligent client at the heart of this project, and where was the learning from previous procurement fiascos? Is the Minister accepting personal responsibility for this debacle, and if so, how does he plan to atone?
Jeremy Quin
I thank the hon. Gentleman for his wide range of questions. I think he ought to be slightly careful in damning all defence procurement. He mentions Nimrod, but I am sure he is very proud to see Poseidon arrive in Lossie, and indeed the E-7 in due course. I hope he is proud of the work being done on the Type 26 and Type 31 on Rosyth and the Clyde, and the huge amount of work that is going through Scottish industry at the moment, including Boxer. Again, Thales is employed on that, and I am sure will do a good job. I have had no complaints, he will be pleased to hear, about the sighting systems that are made, as he rightly says, by Thales—in Glasgow, I believe, but certainly in Scotland. We are going through the demonstration phase, and as an intelligent client, the MOD is required to check everything we are receiving. I reiterate that we will not take something into service and accept IOC until we are ready to do so, and we are holding our suppliers to account.
Felicity Buchan (Kensington) (Con)
Can my hon. Friend confirm that we are fully committed to the Ajax programme, with its assembly in Wales and huge investment in the Union, and also its operational deployment in 2023-24?
Jeremy Quin
Yes, we are absolutely committed to Ajax. We have come a long way with this project. It was originally approved by Ministers of a different colour back in March 2010, and in saying that I acknowledge that it has been a long time coming. However, we are on the cusp of getting this right and getting it sorted. There are issues that need to be resolved—I recognise that—but we will resolve those issues and we will bring it into service.
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
As the Minister has said, in March 2010 the then Government opted for Ajax in contrast to the suggested BAE CV90. This weapon is in operation with seven armies, two of which are members of NATO. It can make 70 kph and it weighs considerably less than Ajax. Is it not possible, in all honesty, that a mistake was made when we opted for Ajax as opposed to the BAE suggestion, which would after all have been manufactured in Newcastle?
Jeremy Quin
I would not dream of answering for the Ministers in the last Administration back in 2010, but I would say a couple of points in mitigation. First, on a tiny point of detail, this vehicle is intended to be able to go at 70 kph, and the temporary limitations are temporary for training purposes. On the broader question, again it is a long time ago, but my understanding is that they are fundamentally different platforms. The Ajax we look forward to taking into service is the first of its nature to have the digitalisation of the platform, with the enhanced lethality and enhanced protection. We stand by the decision that the MOD made, and we are very close to getting to IOC, albeit that we have two significant issues to resolve.
Jacob Young (Redcar) (Con)
Can the Minister update us on how UK suppliers are involved in the Ajax project, and does he agree with me that projects such as this provide the opportunity to support British jobs in steel, textiles and other types of heavy industry, while protecting our troops on operations?
Jeremy Quin
I am absolutely delighted to. There are some 230 companies, all in all, as part of the supply chain. A lot of them had a tough time during covid; I mentioned Merthyr, where General Dynamics is based, in particular. I am very grateful for the work that has continued on the project throughout. I had the opportunity to visit one of the track manufacturers up in north-west Durham, and there are many others around the UK; the hon. Member for Angus (Dave Doogan) referred to Thales in Glasgow, and my hon. Friend the Member for Kensington (Felicity Buchan) rightly referred to components of the electronics from Wales, so there are companies around the UK that benefit. We need to learn lessons from Ajax, but we also need to recognise that there are so many great skills and fine companies across the UK that we need to ensure are properly embedded into the land industrial strategy that we will publish in due course.
Mr Toby Perkins (Chesterfield) (Lab)
Defence equipment is traditionally procured to do damage to our adversary, but I understand that the Ajax vehicle has been giving soldiers a risk of tinnitus and swollen joints if they were driven at speeds above 20 mph. In addition, it is unable to fire while moving. The Minister has just described it as a first-class piece of equipment; the men and women of our Army had better hope that he never procures something that he considers substandard.
In his answers so far, the Minister has told us that he is aware of the problems, but he has not given us any real sense of where the solution is or when it will be coming. Can he tell us any more about when we expect the Ajax to be fully operational? What progress has actually been made, as well as identifying the problems that we are all aware of?
Jeremy Quin
The hon. Gentleman asks serious questions. I just reiterate that there is a difference between what a vehicle can do and what it is certified to do. With things like fire or manoeuvre and the speed limitation, we should not read into them that the vehicle is incapable either of firing on the move or of going above 20 mph. That is not the case; it is simply that that is not what it is certified to do at the moment.
The hon. Gentleman also highlights, perfectly reasonably, the issues that I touched on about noise and vibration. On noise, there are mitigations in place at the moment, and there are further mitigations in terms of the headsets. When we introduced Ajax, the problems occurred in using the standard British Army headset for use in armoured vehicles; the concern that we came across in testing the inner ear was that that was not adequate for the task.
There are two issues that we are therefore looking at: the headset and the noise of the vehicle itself. The noise can have two components; it can be mechanical, but it can also be the electronic noise generated by the aircraft that is communicating with the headsets. I wish that I could tell the hon. Gentleman that a week on Tuesday it will all be resolved. I cannot, but I can tell him that there are issues that we are seriously working through with the suppliers to ensure that we get there.
With vibration, General Dynamics has not had the same experience that we have had, apparently: over many thousands of miles of driving, it has not seen the same issues. That is why we are going to Millbrook, which will have sensors all over the vehicles to test where the vibration is happening and whether we can isolate it. It may be resolvable quickly; it may not be. I can commit only to telling the hon. Gentleman that we will do the work and that I will ensure that people are aware of how it progresses.
Dr Julian Lewis (New Forest East) (Con)
It is encouraging that General Dynamics has been able to make a vehicle work satisfactorily in the United States, so will my hon. Friend confirm that the Government will not be rushed into bringing this already much delayed vehicle into service until these problems are solved to the satisfaction of the people in the armed forces who will have to fight in it?
Jeremy Quin
I am so glad that my right hon. Friend asks that question, because it requires a very simple answer: absolutely. Unfortunately, as he rightly says, there has been a long pattern of delays with the project, but we are not going to take into service something that does not meet our requirements. It is a firm price contract; we need to have it right, and take it into service when it is right to do that. We are not going to obfuscate in order to do so.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind) [V]
There are reports in the media citing the leaked Government report on the procurement of Ajax tanks and stating that
“the problems were known to the army as early as 2017, but they”—
the MOD—
“didn’t admit them due to embarrassment.”
Does the Minister agree that it would be far more embarrassing, and a failure in the duty of care to our defence personnel, if the Ajax programme went ahead without finding the root cause or mitigating these serious defects?
Jeremy Quin
I agree with the hon. Lady that we need to find the root cause of the defects—that is absolutely right—or at least, we have to first identify that there are defects and then make certain that we have resolved them. I think that would be a fairer way to put it, and that is what a lot of the testing is doing right now. On when these problems first occurred, I do not think awareness of them came from the Infrastructure and Projects Authority report. I have been aware from social media sources of a suggestion that the Army was aware back in 2017. That has not been my experience, having looked into it. The concerns over vibration are a far more recent occurrence.
Philip Dunne (Ludlow) (Con)
As the Minister is well aware and has articulated well today, this Ajax programme is a critical capability for the British Army. When originally the contract was let, we did not have in this country an assembly line capable of manufacturing land capability at scale, particularly armoured capability. The introduction of this capacity through General Dynamics into south Wales is a very important part of the defence industrial strategy, which he has referenced. It is valuable for the whole House to remind itself that we are not talking in a vacuum here; this is a capability that the Government in the coalition days ensured was built in this country.
We were looking at a design that relied upon economies of scale to bring a state-of-the-art turret, which was going to be jointly deployed on Warrior, with a cannon jointly developed with France, again with state-of-the-art capability and lethality. Can my hon. Friend reassure the House that the cancellation of the Warrior programme will not impact on the ability to deliver turrets and cannons into the Ajax programme and will not add further delay or cost increase?
Jeremy Quin
My right hon. Friend speaks with considerable experience, and I thank him for what he says about the production line. I do not know whether he ever had the chance to visit Merthyr. He probably did.
Jeremy Quin
He did, as I have done recently. It is an impressive factory with impressive personnel doing a good job. We just need to make certain that the whole thing fits together and works, and that is what we are committed to do.
To reassure my right hon. Friend on the Warrior, I have seen no evidence that the cancellation of the Warrior capability sustainment programme should have an adverse effect on the turrets for Ajax. Indeed, I believe I am right in saying that 58 of those have already been manufactured.
Nick Smith (Blaenau Gwent) (Lab)
May I also confirm that the Merthyr factory is an impressive capability? The defence and security industrial strategy gives Ajax as an example of regional levelling up, so can the Minister confirm where the turrets for Ajax will be built?
Jeremy Quin
My understanding is that those turrets have been built by Lockheed Martin and are being constructed in Ampthill in Bedfordshire. That is my understanding, but I will double-check. If it is any different, I will write to the hon. Gentleman and leave a copy of my letter in the Library of the House of Commons. It is my understanding that that is happening at Ampthill.
Dr Andrew Murrison (South West Wiltshire) (Con) [V]
Does the Minister agree that the Ajax situation undermines global Britain’s forward presence objectives as envisaged in the integrated review, such as the ability of the Royal Dragoon Guards based in Warminster to project reconnaissance combat teams, which they were being re-roled for? If it turns out that the vibration issue—[Inaudible.]
Mr Speaker
The sound is as defective as the programme. Minister, do you want to try to answer that?
Jeremy Quin
I am very sorry that we have lost my right hon. Friend. It gives me scope to interpret his question. I think he was asking about our capability to equip our recce troops. What we can do is a needed step change. The vehicles we are currently using were brought into service in the 1970s. We need that digitised framework. We need those sensors. We need the four dimensional capability. The programme will significantly help our armed forces, and we will be able to deliver it at speed.
Matt Western (Warwick and Leamington) (Lab)
The Minister is a decent person, but this is extremely worrying news. The idea that we have a vehicle that can go almost as fast as a bicycle, but cannot actually fire its weapon on the move, while also posing such a risk to our troops is very worrying. The defence analyst, Francis Tusa, has described this as the Army’s Nimrod MRA4. Is he right, and what does that say about our defence procurement capability or, should I say, incapability?
Jeremy Quin
I thank the hon. Gentleman for his nice remarks. He is also a very decent person, but I fear that he was not listening fully to my earlier responses regarding speed and fire on manoeuvre, which are capabilities that Ajax will be able to deploy. We are still in demonstration phases, so we do not get the full finished article; it is the capability 3 drop that provides us with the vehicle that will be used on operations.
The hon. Gentleman is worried. I, too, am concerned that we have issues. I would much rather have come to this place and said, “All’s well; 30 June 2021—we’re looking good.” The fact that we have tests on vibrations, which will not be fully reported on until the end of July, speaks all one needs to know about that particular date. We have been pushing and pushing, and it is still possible that we will get a very easy answer. I fear that it may take longer, but we will continue to work to resolve these issues. However, we are spending £5.5 billion on a fixed-price contract. A lot can go wrong in a contract. A lot needs to be worked on with the suppliers, and in terms of the demonstration phase, that is what we are going to do.
David Linden (Glasgow East) (SNP)
Unfortunately, this is not the first time that the MOD has been found not to have undertaken the proper due diligence with respect to its hardware. There are serious questions about not only this hardware, given the reports of potential injuries to personnel, but the process through which it was selected, developed and commissioned. Given tenders such as the Nimrod MRA4 and others like it, the British Government have billions of pounds lying in the balance. Will they therefore commit to reviewing how they handle such tenders?
Jeremy Quin
We constantly look at how we can best procure. Through the defence and security industrial strategy, we are looking at trying to improve significantly the processes that we undergo, including by having far more active contact with companies, particularly onshore UK companies, in order that we are able to work with them, and more agility in the nature of the contracts that we undertake. There is a process in place to ensure that we procure as best we possibly can, although, as I say, it is a £5.5 billion contract doing something that has not been done previously globally, and it is important that we recognise that issues can emerge. The critical point is to spot those issues and then make certain that they are resolved.
Robert Largan (High Peak) (Con)
I welcome the Government’s commitment to investing in our armoured fighting vehicles. It is vital that we never have a repeat of a situation where our armed forces personnel are put in harm’s way without appropriate protections. However, it is clear that there have been issues with the Ajax programme, so can the Minister assure the House that all steps will be taken to learn the lessons of this and improve our defence procurement?
Jeremy Quin
Yes, we can learn from all procurements. We learn something from everything that is done. I wish this was a totally smooth process. It has not been—from the recast in 2014, to the recast in 2019, the delay to IOC and the fact that here we are, at this point, with two significant issues that I still need to get to grips with and resolve. We will have points to learn from, but I gently say to the House that a demonstration phase is a demonstration phase. We need to learn through a demonstration phase and then apply what we have learned.
John Spellar (Warley) (Lab)
The Minister seemed slightly hurt that the shadow Secretary of State, my right hon. Friend the Member for Wentworth and Dearne (John Healey), described him as complacent, and then he went on to confirm that description. He talked about vibration. He took the manufacturer’s word for it, even though the users found something different. Talk about shades of “dieselgate”. He said that the noise can be mechanical, but somehow, he does not seem to have got to the bottom of where it is coming from. He said that Ajax is capable of firing on the move, but somehow, it does not seem to be able to do so at the moment. Do the troops on the frontline not deserve something better, and does he not need to get a grip?
Jeremy Quin
The right hon. Gentleman made a number of points. On the vibration, if I took the word of the supplier, we would have met IOC and we would not have issues. I take the word of our crews who have been training on the vehicle; that is why we have taken it so seriously, why we have commissioned the reports that we have commissioned and why the vehicles are currently at Millbrook being put through their paces. I absolutely reassure the House that we will not take the programme into IOC until we are confident that we have achieved what we need to achieve at this stage of the vehicle’s development. I absolutely stand by that.
The right hon. Gentleman also made points about firing on the move and the speed restrictions; there is a difference between the certification of rolling process, certification during a demonstration and future phases, and what the vehicle is capable of.
Jack Lopresti (Filton and Bradley Stoke) (Con)
On the back of Army modernisation and the £24 billion investment in the integrated review, there is a significant opportunity to grow land exports. Will my hon. Friend confirm to me and the House what export opportunities he expects to arise from the Ajax programme?
Jeremy Quin
I would very much like to see this vehicle as an export opportunity, and I believe it can be. The noise that has been quite rightly and legitimately raised in respect of the issues in the demonstration phase is understandable, but it probably will not help the vehicle’s export potential immediately. I hope that, during the demonstration phase, we can resolve what we need to resolve, and I would love to see a situation in which I can confirm to the House that all is well, that we have hit IOC and that we are going to proceed to FOC. Incidentally, someone asked about FOC earlier but I did not come back to them: we are doing work with Tony Meggs from the IPA to make certain that we get an agreed FOC. I should have said that earlier, but it is now on the record. I hope to get that sorted and then proceed to export what will be a transformational vehicle in service with the British Army to our allies and friends around the world, meaning more jobs for this country.
Patricia Gibson (North Ayrshire and Arran) (SNP)
In addition to issues with the Ajax programme, the Government are still struggling to get on top of the massive black hole in their equipment plan, with the most recent report from the National Audit Office having found that it “remains unaffordable” for “the fourth successive year”. That is another warning from the NAO that has not been properly heeded by this Government, and the plan is up to £13 billion overdrawn. What plans does the Secretary of State have to plug the huge financial black hole?
Jeremy Quin
With the greatest respect to the hon. Lady, the report to which she referred was published prior to the injection of the additional £24 billion earlier this year. As a result of that, we will be publishing an equipment plan that will add up. I recognise that that will be for the first time in many years, and under successive Governments, but we will have a plan of which we can all be proud.
Marco Longhi (Dudley North) (Con)
As a proud member of the armed forces parliamentary scheme, I am delighted with the £24 billion investment in our armed forces that was set out in the integrated review. As my hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) just said, that investment also presents a great opportunity to grow exports. So can the Minister confirm what progress he may have made with colleagues in the Department for International Trade and what opportunities he may expect will arise in respect of armoured fighting vehicles?
Jeremy Quin
That is a positive point on which to end these exchanges—if, indeed, this is the end Mr Speaker. It is absolutely right that we should look at the land industrial strategy to see what we can secure for this country. In terms of armoured fighting vehicles, we have not only Ajax but Boxer, and there is additional work on our Challenger 3 main battle tank. We have a lot of capabilities in the land domain, as we have in respect of exporting ships of various descriptions and the fantastic work that we continue to do on Typhoon and the development of our future combat air system. There is huge potential for us not only to defend our country and keep us secure but to offer huge prosperity benefits to all the people of the UK.
Mr Speaker
I am now suspending the House for three minutes to enable the necessary arrangements to be made for the next business.
British Council
(3 years, 6 months ago)
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Mr John Baron (Basildon and Billericay) (Con) [V]
(Urgent Question): To ask the Secretary of State for Foreign, Commonwealth and Development Affairs, if he will make a statement on British Council closures.
The Minister for Asia (Nigel Adams)
The British Council is a crucial part of the UK’s presence overseas and a key soft power asset. It works in more than 100 countries to promote UK education, arts and culture, and the English language. The Government remain committed to the British Council. As the integrated review made clear, we value the influence of the British Council. We agreed a 2021-22 spending review settlement totalling £189 million, which is a 26% increase in funding from 2020-21. The British Council has not been cut. Although we have had to make difficult decisions to cut in other areas, we have increased the money we are providing to the British Council. Not only have we increased funding; we have provided a rescue package during the covid-19 pandemic. This includes a loan facility of up to £145 million, with a further £100 million loan being finalised to support restructuring. We have also provided a letter of comfort to ensure that the council can meet its financial obligations.
We found this funding for the council in the context of an extremely challenging financial environment. As a result of the pandemic, the UK is facing the worst economic contraction in over 300 years and a budget deficit of close to £400 billion. This package is necessarily accompanied by changes to the council’s governance essential to modernise the council. These include measures to update the British Council’s charitable objects, to focus the council on its core pillars, to streamline its governance structures and to agree new key performance indicators and targets to monitor council performance in key areas. The Foreign, Commonwealth and Development Office and British Council officials have worked together to ensure that the council will align even more closely with the Government’s strategic priorities and can focus on doing what it does best.
Having worked closely with the British Council, we are reviewing physical council presence in-country as part of this modernisation process. These changes will be minimal, but it is a strategic mistake to judge the impact of the council in a digital age solely by the physical office in-country. Rather, it should be judged by its operational presence, by the digital services we are investing in and which have expanded rapidly as a result of covid, and by its ability to operate through regional hubs and third parties. The covid crisis has changed the way we all have to operate. We have also implemented a new evaluation mechanism, so that when Ministers travel, they can assess the value for money and the impact provided by the British Council on soft power. This is a strong rescue and reform package. The council will also shortly have a new chief executive officer, so it will have strong leadership and a governance structure to make it viable and to reinforce its role as a force for good.
Mr Baron
Thank you, Mr Speaker, for granting this urgent question. I also thank colleagues from all parties who are supporting our campaign and who signed the letter to the Prime Minister, and I thank the Minister for responding to the urgent question. Speaking as chair of the British Council all-party parliamentary group, I know that our own dealings with the Government and the letter published between the FCDO and the Foreign Affairs Committee confirm that office closures are about to take place overseas. This is about to be announced by the Government. The number varies from five to 20, but even five would represent the largest set of closures in the British Council’s history, and all for the sake of a £10 million shortfall in funding.
The Minister is right when he says that funding has been supplied to the British Council. We all know that the British Council does an excellent job, and I will not waste colleagues’ time by extolling its virtues. It is a key reason that the UK is considered a soft power superpower. Its high-quality, dedicated staff do an excellent job in promoting British culture, education and the English language overseas, facilitating cultural exchanges and building trust between other countries and the UK. In any normal year, it derives only 15% of its funding from the Government because of its commercial activities, but those commercial activities have been savaged by the pandemic. The Government have stepped forward, but their funding is still £10 million short of what the British Council needs to maintain its international network —its footprint of offices overseas—and its programming. The Government have gone so far, but they are falling at the final fence.
The Minister may say that the British Council needs to move into the technological age—he talks of a digital age—but there can be no substitute for a presence on the ground. The litmus test when it comes to the site closures is not only the Government’s talk of hub and spoke arrangements in certain regions; it is whether the country directors themselves are in situ, and country directors are going to be made redundant.
Let us remember that these closures are happening only because of the £10 million in cuts. They are not of the British Council’s choosing, so talk by Ministers that such decisions are for the British Council rings somewhat hollow. There has been strong ministerial involvement in these decisions, as confirmed by the letter to me from the Prime Minister, and it is Ministers who have instigated these cuts.
Very briefly, the closures are wrong because they are not in keeping with the concept of global Britain—the Defence Secretary has said that there is not enough British Council in the world—but they are also wrong strategically. It is a bad decision—
Mr Speaker
Order. We have to go to the Minister. I warned the hon. Gentleman that he had two minutes, and he has now taken three minutes-plus.
Nigel Adams
Thank you, Mr Speaker. I have a great deal of time for my hon. Friend the Member for Basildon and Billericay (Mr Baron), who does a great job chairing the all-party group. I am sure he is fully aware that, given the challenging position in which we find ourselves, many arm’s length bodies would be thrilled with a 26% increase in funding for next year.
Obviously, plans for the British Council’s global presence are still being finalised. It is a matter for the British Council to comment on the plans, and if they involve changes in country, I think my hon. Friend would appreciate that it is only right that the British Council is given the opportunity to consult its employees, trade unions and so on. Of course, any final decisions will be communicated in due course.
We will continue to support the council to ensure that it plays a leading role in enhancing UK soft power. My hon. Friend briefly mentioned global Britain before he was chopped off at the knees, and our commitment to it is clear. It is clear in the fact that we are hosting the G7 this week, as well as securing a deal on global tax reform. We also rank exceedingly well in the leading soft power indices and rankings. I, too, am getting the stare from Mr Speaker, so I shall sit down.
Stephen Kinnock (Aberavon) (Lab)
I would first like to pay tribute to the hon. Member for Basildon and Billericay (Mr Baron) for his tireless work as chair of the APPG. Secondly, I declare an interest: I worked for the British Council from 1996 until 2008, during which time I was posted to Brussels, St Petersburg and Sierra Leone.
The council’s core purpose is to build long-term, trust-based relationships between the UK and other countries—and my goodness, it delivers. From its global network of world-leading English language teaching centres, to its outstanding arts and culture programmes, its work on democracy and good governance, its education reform and media freedom projects, and its scientific exchange and promotion of the UK’s higher education sector, the British Council provides us with an object lesson in how to win friends and influence people.
The council also provides excellent value for money for the British taxpayer, with the success of its commercial operations gradually reducing reliance on Government financing, but those operations have of course been hit hard by the pandemic, meaning that the council requires UK Government support to weather the storm. It is therefore deeply disappointing that the Government are refusing to make good the shortfall, which in turn is forcing the council to look at closing down offices in up to 20 countries. The Government’s position represents the very definition of a false economy. It is short-sighted and would inflict profound damage on Britain’s status as a soft power superpower.
On the eve of the G7 summit, I urge the Minister to think again. Will he please tell me how he intends to support the British Council to fulfil its integral role in making Britain a force for good in the world—an ambition set by the Government in their integrated review? Does he understand fears that the Government’s abandonment of their 0.7% manifesto commitment on foreign aid, combined with their ambivalence towards the council, sends a signal that Britain is withdrawing from the world stage, rather than offering leadership? Will he therefore return to this House before the summer recess with a plan that secures the British Council’s entire global network?
Nigel Adams
May I praise the hon. Gentleman for the work he has done with the British Council— 12 years is a very long stint working for a fantastic organisation—but also prod him gently for talking about our “ambivalence” towards the British Council? I politely remind him that we will be providing £149 million in grant in aid this year and £189 million in grant in aid next year. That is an increase of 26%. We have provided the British Council with a £145 million covid loan and are providing a £100 million loan to help it to restructure. In March 2020, we provided £26 million. Madam Deputy Speaker, £609 million of British taxpayers’ money since the pandemic hit does not sound like ambivalence to me. The hon. Gentleman is right: the integrated review made it clear that we value the influence of the council—of course we do—and we will continue to support the British Council in playing its leading role in enhancing the UK’s soft power throughout its work overseas.
Tom Tugendhat (Tonbridge and Malling) (Con) [V]
It was very welcome to hear the Minister’s defence of the spending going towards the British Council and the way in which the Department and the Government have supported this essential service of Britain’s presence overseas. Perhaps my hon. Friend the Minister would also like to set out not just how we defend such a fantastic institution, but how we improve it and increase its reach. The closure of these five sites will, one must only hope, be reversed soon—perhaps not in exactly the same place, but in other buildings. What plans does he, the Department and the Foreign Secretary have to make sure that the British Council fulfils the opportunity that is before it and does not simply become a backwater?
Nigel Adams
I thank the Chair of the Foreign Affairs Committee for his remarks. We will be supporting the British Council going forward. It has undoubtedly gone through a torrid time: the covid pandemic has hit the British Council’s commercial activities incredibly hard. May I also use this opportunity to pay tribute to the staff of the British Council, as well as the leadership? They have had a torrid time, as has all the FCDO network, working under such difficult circumstances during the pandemic.
To answer the Chairman’s questions, we are revising the charitable objects of the British Council to focus on arts and culture, English language and education. There will be some key performance indicators coming forward. I work very closely with the chairman and the acting chief executive of the British Council and have met them on many occasions since taking up this position. We will continue to work with them closely. I think that the future for the British Council is very bright going forward, and we intend to continue to ensure that global Britain is a world leader for soft power.
Chris Law (Dundee West) (SNP) [V]
The decision by the UK Government to refuse to support the British Council in its hour of need is further evidence of the “little Britain” attitude at the heart of this Government. Indeed, this new little Britain approach is so small that the Scottish Tory party wrote to the UK Tory party to question why the Scottish Government have the temerity to pursue links abroad. Yet we learn only a fortnight later that the Government are happy to slash the British Council’s international outposts. So, is the Prime Minister’s “global Britain” pledge as hollow as these moves suggest?
Furthermore, the Government previously described the British Council as a
“key driver of UK soft power overseas.”
If it is integral to the UK’s global outlook, why have this Government decided to withdraw their support? Lastly, once again we see the Government renege on their word. The last Conservative manifesto stated:
“We will work with our cultural institutions like the BBC and British Council to expand our influence and project our values.”
Just like cuts to life-saving support for the world’s most vulnerable, is this yet another broken promise for this Government?
Nigel Adams
I have a lot of time for the hon. Gentleman, but references to little Britain are frankly nonsensical. I am not entirely sure whether he listened to my statement, but we are increasing funding to the British Council next year by 26%. That is not abandoning the British Council. We value the work of the British Council. We will be supporting it, we have stuck up for it and we have got it a good settlement going forward. We have helped to bail out the British Council when times have got tough, and we will continue to work with it to ensure that it continues the fantastic work it does around the globe.
Sir Robert Neill (Bromley and Chislehurst) (Con) [V]
The British Council gives extraordinarily good value for money, as the Minister knows. He will also be aware that taxpayer support for the British Council is significantly less than that provided by their counterparts—and, dare I say it, our commercial competitors?—in France, Germany and Japan. Research by the British Council demonstrates that its building of trust and connections generates greater economic activity. Will he bear in mind the importance of not spoiling the ship for a ha’p’orth of tar? In promoting our values, will he pick up on research showing that our commitment to the rule of law, our free judicial system and the quality of our legal system are also strongly recognised as being critical great British global values?
Nigel Adams
My hon. Friend is spot on, and that is exactly where we are on this. As the integrated review made clear, we value the influence of the British Council globally, and we will continue to support it in playing a leading role. In his foreword the Prime Minister reiterated our commitment to soft power and, indeed, recognised the contribution of the British Council, writing that it is one of the
“vital instruments of our influence overseas”.
That is why we are providing support and continue to work very closely with the British Council.
David Warburton (Somerton and Frome) (Con)
I am grateful to my hon. Friend for his encouraging remarks, because as the former chair of the British Council all-party parliamentary group I saw at first hand just how the council works across the globe as the engine room of UK soft power. In the face of the budget short- fall, however, offices will close, programmes will be cut and jobs will be lost. Does he agree that the promotion of British culture and language is key to the UK thriving post Brexit, and vital in building a truly global Britain?
Nigel Adams
My hon. Friend is absolutely right. This is the first time I have seen him in a very long time; may I congratulate him on how magnificent a specimen he looks these days? He raises an important point: it is absolutely essential that we continue to promote the United Kingdom, and the British Council does exactly that. Research has shown that students, for example, are 15% more likely to choose the UK as their study destination after using British Council services. I also thank my hon. Friend for his work as a former chair of the all-party parliamentary group.
Christine Jardine (Edinburgh West) (LD) [V]
It is clear from Members’ contributions that there is absolute unanimity about the importance of the British Council in promoting Britain’s interests and soft power across the globe. Indeed, the Minister himself has emphasised that. However, there seems to be contradiction between the commitment he expresses and the funding gap that is being allowed to develop. Will he tell us how the Government propose to close that funding gap in future years to ensure that the British Council does not move into some sort of managed decline as a result of a lack of funding?
Nigel Adams
I assure the hon. Lady that it is absolutely our intent to support the British Council—that is why we have increased its funding. As I have said, since the pandemic hit, this Government have committed to providing £609 million, which is a considerable increase. We want to ensure that the council remains on a stable financial footing. I can also tell her that the recently announced new CEO of the British Council is a formidable figure, and I am sure that he will do a fantastic job alongside the chairman, Stevie Spring. I think it has exciting times ahead under such formidable leadership.
Dr James Davies (Vale of Clwyd) (Con)
In 2019-20, there were six schools in my constituency that benefited from excellent British Council programmes. Five were twinned with schools elsewhere in the world, and one—Ysgol Llywelyn in Rhyl—received an international school award. Will my hon. Friend confirm that opportunities such as these will not be impacted by covid-induced financial pressures?
Nigel Adams
I think my hon. Friend is referring to the Connecting Classrooms through Global Learning schools programme, which builds long-term relationships between schools, communities in the UK and developing countries. The Foreign, Commonwealth and Development Office will continue to fund that programme for 2021-22.
Tony Lloyd (Rochdale) (Lab) [V]
There is unanimity across the House on the values of the British Council going way beyond narrow commercial ones. This is about the values that we have as a nation, and the kind of world in which we want to live. Even in hard commercial terms, the British Council pays back to this nation what it costs, and in considerable excess of that. What consultation is there with other Government Departments, such as Education, International Trade, and Business, Enterprise and Industrial Strategy, for example? All those Departments and others would have an interest in making sure that we do not lose up to 20 British Council posts worldwide. That kind of information would allow us to assess whether the Government’s credibility is real on this issue.
Nigel Adams
May I just correct the record? I may have said Stewart McDonald was the incoming CEO. I was confusing him with one of our colleagues; it is Scott McDonald who will be the new chief executive. [Interruption.] Two of our colleagues! Crikey. I am sorry to disappoint the two in question. Anyway, Scott will do a fantastic job leading the British Council.
The hon. Member for Rochdale (Tony Lloyd) makes a good point. Of course we talk across Government—across all our network. We have BEIS employees in posts where there are British Council employees around the country, and we will continue to do that. We want to support the Council in continuing its brilliant role in ensuring that our United Kingdom soft power is enhanced through its work overseas.
Jim Shannon (Strangford) (DUP)
Will the Minister identify which other body promotes the British language, the arts, the global economy, Climate Connection and so many other sectors which are so competently handled within the existing structure? Does he acknowledge the tremendous work that has been done by the British Council so far?
Nigel Adams
Absolutely; we hugely value the influence of the British Council. We will continue to support it in the leading role that it plays, enhancing the United Kingdom through its work overseas. As I mentioned previously, the Integrated Review reiterated our commitment to soft power. It recognised the contribution of the British Council. The Prime Minister’s foreword to the Integrated Review policy paper referred to the British Council as one of the “vital instruments” of our influence overseas.
Karen Bradley (Staffordshire Moorlands) (Con)
My right hon. Friend the Minister will shortly be able to travel the world, and when he does so he will find that the presence of the British Council on site is the best embodiment of global soft power that this country has. The British Council has a funding shortfall because it cannot operate commercially. Can my right hon. Friend please find it in him to give that additional support to make sure that that on-site presence is there for when he makes those ministerial visits?
Nigel Adams
I thank my right hon. Friend for her question. May I correct the record—with apologies, because she is a very good friend of mine—as I am an hon. Member rather than a right hon. Member? Either way, she will appreciate that plans for the global presence of the British Council are still being finalised. We have provided a package of support and an increase in funding of which, as I said, many arm’s length bodies would be extremely envious. It is, of course, for the British Council to comment on its plans for the overseas network, but I assure my right hon. Friend that those final decisions will be communicated shortly.
Patrick Grady (Glasgow North) (SNP)
Does the Minister not understand that funding for next year is no remedy for cuts, decisions and closures that will take place now? There will be long-term consequences as a result of what he is trying to describe as short-term funding shortfalls. Is that not the problem with the likes of the Prime Minister viewing aid as a giant cash machine in the sky? The Government are losing sight of the long- term consequences of their short-term decisions.
Nigel Adams
I am afraid I disagree with the hon. Gentleman’s assumptions. The impact of the pandemic has forced the Government to take incredibly tough but necessary decisions in many areas. Despite that economic climate, we have managed not just to protect the grant in aid funding that the British Council received this year, but to increase it. As I said, we are also providing a loan to help it get through the impact of the covid pandemic. Last March, when the pandemic first hit, there was immediate assistance of £26 million, plus another £100 million restructuring facility that we are working with the British Council on, so I do not accept the hon. Gentleman’s assertions whatsoever.
Sir Edward Leigh (Gainsborough) (Con)
The French and the Germans are steadily increasing their efforts through the Goethe-Institut and the French Institute, where I spent many happy hours trying to bone up on my inadequate French. Meanwhile, for decades we have been closing British Council libraries, which are often the only places where people can get free access to English literature. Will the Minister go back to his officials and insist that English literature is our greatest cultural export, and that there must be no diminution in our efforts to expand and promote it worldwide?
Nigel Adams
My right hon. Friend is correct. The British Council is a world-leading provider of language teaching, teacher training and examinations on behalf of the UK Government. It reaches 100 million learners and teachers of English annually across more than 100 countries, and it has been shown that increased levels of English language speaking benefits the United Kingdom.
Mr Clive Betts (Sheffield South East) (Lab) [V]
The Minister has heard from colleagues across the House of the great support for the British Council, the recognition of its incredible work and the great value it gives. In 2018-19 the British Council estimated that German funding for their soft power agencies was three times that of the UK, and that in France it was twice the UK level. Is the Minister not concerned that the cuts the British Council now has to make will further undermine and reduce our influence compared with our major European neighbours?
Nigel Adams
I thank the hon. Gentleman for his question. Other countries have various programmes, and the Goethe-Institut and the Institut Français have different models. The British Council operates slightly differently with more commercial operations, and it is reliant on less Government funding than the others. Our determination to work as a force for good in the world is an important part of our soft power. The British Council is the key driver in that and will continue to act as a force for good for the United Kingdom, for example by teaching English to young women in south Asia. The education that the British Council provides is outstanding and will continue to be, and we will continue to support it.
Gareth Thomas (Harrow West) (Lab/Co-op)
I share the concern about the British Council’s funding settlement and the potential office closures, not least because of the understated role that the British Council plays in helping to boost trade. Will the Minister in particular assure me that there will be no cuts to the council’s presence in India, Pakistan and the other counties of the Indian subcontinent, where we have both strong historical links and the need to boost trade?
Nigel Adams
The hon. Gentleman will understand that I am not in a position to announce any of those arrangements at this point. The plans for the British Council’s global presence are still being finalised, and it is for the British Council to comment on its global network. However, I can assure him that decisions will be communicated very shortly.
Jerome Mayhew (Broadland) (Con)
While it is generally agreed across the House that the soft power applied on behalf of the UK by the British Council has been enormous, surely we must take account of the fact that thousands—in fact, tens of thousands—of businesses across this country have had to adjust to the financial disaster that covid has applied to them. The British Council should do no other than that, despite having hundreds of millions of pounds support from this Government.
Nigel Adams
My hon. Friend makes a fair point. These are extraordinary times and the impact that the pandemic has had on world economies—not just on the UK economy—has sent out a shock wave. We have backed the British Council, we have supported it and we are ensuring that it has an increase in its funding for next year. He is right to point out how important a role the British Council plays in soft power through its work overseas. I am told that one in five world leaders was educated at a UK university, which is more than any other country except the US. Given the fact that 15% of foreign students are influenced by the work of the British Council in determining where they have their education, that is testament to the brilliant work that it does.
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
I remember, while going on British Council activities in the Balkans after the Kosovo war, the importance of having local offices in Pristina and Belgrade that connected with people. It was the same when I visited the British Council in Mexico; we could report the same across the whole world: the individual importance of having a base. The young people in those programmes were already using online activities. If the pandemic has taught us anything, it is that online does not replicate person-to-person contact in building trust and culture. If this were a reduction in UK export support for manufacturing, the Government would be outraged and reversing any of the cuts. Will the Minister look again, in particular at the in-person support, to ensure that there are offices in every location where needed and that the support during the pandemic allows the British Council to grow and not just to survive?
Nigel Adams
It is good to hear the hon. Gentleman’s experience of benefiting from the work that the British Council does overseas. I am absolutely confident in the British Council’s ability to grow, not just survive. As I said, the individuals who will be leading this organisation—Scott McDonald and Stevie Spring—are formidable people with huge commercial experience, and that is exactly what the British Council needs. Any organisation would be proud to have these individuals leading from the front, so I have full confidence in the British Council’s ability, under this leadership, to take this fantastic organisation forward.
Madam Deputy Speaker (Dame Eleanor Laing)
I will briefly suspend the House in order that arrangements can be made for the next item of business.
Employment Rights
(3 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
With permission, Madam Deputy Speaker, I will make a statement on the latest steps the Government are taking to protect workers’ rights, as we look to build back better from covid-19. That includes our plans to create a single body responsible for state enforcement of employment rights, modernise the regulator of trade unions and address so-called fire and rehire negotiation tactics.
This Government have been absolutely clear that we will do whatever we need to do to protect and enhance workers’ rights in this most challenging year. In April, for example, we increased pay for around 2 million workers, and the coronavirus job retention scheme has already helped to pay the wages of 11.5 million people across the country. We will continue to champion our flexible and dynamic labour market and to maintain the UK’s excellent record on workers’ rights.
Today, the Advisory, Conciliation and Arbitration Service has published its report on fire and rehire. I know that this is a matter of great interest to employers and workers up and down the country, and I encourage all Members to read ACAS’s report. This Government have always been clear that we do not accept fire and rehire as a negotiation tactic. Workers up and down the country have worked flat out during the pandemic, carrying out essential work to keep our economy going. It is crucial that employers take their responsibilities seriously and act appropriately when it comes to discussions about changing employment contracts.
I have been deeply concerned by reports over the last year that some employers may be turning too soon to firing and rehiring employees and are using this as a tactic in negotiations to put undue pressure on workers to rush into accepting new, and often worse, terms and conditions or face losing their jobs. It is unacceptable and, frankly, immoral to use the threat of fire and rehire as a negotiating tactic to force through changes to people’s employment contracts, or for employers to turn to dismissal and rehiring too hastily, rather than continue to engage in meaningful negotiations. We are not talking about something abstract here—this is about peoples’ lives and livelihoods.
At a time when many workers have shown great loyalty and commitment to carry out essential work and keep our economy going in the face of a pandemic, I expect employers to continue to treat their staff fairly and with respect. That is why my Department asked ACAS to gather evidence on the practice, so that we could evaluate whether further action is needed at this time. I would like to thank ACAS for its work, which has provided my Department with a balanced account, based on insights from employer bodies, trade unions and professional bodies.
The report outlines the circumstances in which fire and rehire can be and has been used, and offers views from a range of contributors on whether and how to tackle the issue. There are different views on whether the practice can ever be justified. For some of the organisations consulted by ACAS, it is never acceptable. For others, in its most legitimate form fire and rehire is a route for employers to avoid redundancies and business failures, after negotiations have been exhausted. However, the report finds agreement that fire and rehire can and should be used only in limited, legally prescribed circumstances. Some thought that this should be further reinforced in law, whereas a number of participants cautioned against new legislation, warning that it may have unintended consequences: it may lead to more redundancies.
This is clearly a complex area. Many of the people ACAS spoke to welcomed non-legislative interventions, such as guidance for businesses, the vast majority of which I recognise want to do the right thing. That is why I have now asked ACAS to produce better, more comprehensive, clearer guidance to help employers explore all the options before considering fire and rehire, and encourage good employment relations practice.
Some of ACAS’s participants raised concerns that fire and rehire is used by employers to break continuity of service to limit the ability of workers and employees to access their rights, as certain employment rights require periods of continuous employment. The Government have already committed to legislate to extend the time required to break a period of continuous service. That will make it easier for employees to access their rights and also deter businesses from using fire and rehire to engineer breaks in employment in order to deny individuals important employment rights.
Despite the unprecedented Government support during the pandemic, this has also been an exceptionally difficult time for businesses. Many businesses have shown an incredible ability to adapt and innovate, and have played a key role in tackling the pandemic. Even so, some employers may need to make difficult decisions, in order to avoid redundancies and to ensure their business can survive and succeed. In those circumstances, employers and employees should always aim to reach negotiated agreements about terms and conditions of employment and exhaust every avenue to achieve this. But the reality is that sometimes, regrettably, negotiations will fail. In these circumstances, employers may need to dismiss staff, and potentially re-engage them. Therefore, any potential reform must be balanced against the possibility of the remedy creating a worse problem than the one it is intended to address: we must be careful not to introduce measures that inadvertently run the risk of businesses going bust, and thus more people losing their jobs.
However, having carefully considered the report, the Government want to send a clear message to employers: even if your business is facing acute challenges, all other options to save jobs and a business should be exhausted before considering the dismissal and re-engagement of staff. I believe that we can achieve this working in partnership with businesses and workers, without heavy-handed legislation.
This House should be left in no doubt that this Government will always continue to stand behind workers and stamp out unscrupulous practices where they occur. That is why today I am also confirming the next steps we will be taking to modernise our labour market enforcement regime. In 2019, the Government published a consultation that set out the benefits of bringing together our three existing labour market enforcement bodies into a single organisation. Today, the Government have published their formal response to that consultation. This new single enforcement body will help the country build back better by taking a smarter approach to the enforcement of employment law. It will make it easier for the vast majority of responsible businesses to comply with the rules. It will ensure a level playing field, through effective enforcement against those who cut corners and exploit workers. Today’s Government response sets out the overarching details of the new body: responsibility for tackling modern slavery, enforcing the minimum and living wages and protecting agency workers will be brought under one roof, creating a comprehensive new authority.
The new body will go further than current enforcement, enforcing holiday pay for the most vulnerable workers, as well as statutory sick pay. It will regulate umbrella companies, enforce financial penalties against organisations that do not meet requirements to publish modern slavery statements, and run the unpaid tribunal awards penalty scheme.
Protecting workers requires support for businesses, too, so that employers understand how to comply with the rules. This is in addition to effective, visible enforcement action to deter irresponsible employers. The body will have a spectrum of powers and responsibilities to achieve that, including the ability to issue guidance and compliance notices and levy civil penalties for certain offences, and the power to prosecute the most exploitative employers.
Protecting workers is not just about support for business and effective state enforcement. Trade unions have an essential role in the workplace; I know from my regular close engagement with unions how important their work is. Today, the Government have published our plans to modernise the regulation of trade unions, bringing the certification officer in line with other regulators. These reforms will implement technical measures passed by Parliament via the Trade Union Act 2016, providing reassurance to union members and the wider public.
We are confirming three changes related to the certification officer today. First, we are extending the certification officer’s powers to enable her to proactively investigate when a third party raises concerns that a union or employers association may have breached its statutory duties; we will also expand the powers available to her to conduct those investigations. Secondly, we will give the certification officer the power to apply financial penalties to unions or employers associations where the most serious breaches are found to have occurred. The sanctions will be targeted only at the small minority of unions that breach their statutory requirements and obligations. Thirdly, we will move the certification to a levy funding model, which will bring the certification officer in line with other regulators such as the Pensions Regulator and the Financial Reporting Council. Proper and fair regulation will ensure that all trade unions and employers associations conduct themselves to the highest standards.
The United Kingdom has one of the best records on workers’ rights in the world, going further than the EU in many areas, and we are determined to build on that record. By modernising our labour market enforcement regime, protecting workers more extensively, supporting businesses to comply with the law and preventing them from being undercut by a minority of irresponsible employers, we can continue to be a high-wage, high-employment economy that works for everyone as we build back better.
Andy McDonald (Middlesbrough) (Lab)
The Government have overseen a crisis of insecurity and a lack of protections at work, and the proposals announced today will do little to address it. There is no plan to legislate for a single enforcement body, so can the Minister explain how and when that will happen, given that the long-promised employment Bill has been ditched?
There is no new money in this announcement. We had a decade of cuts and underfunding that left us woefully unprepared when the pandemic hit. In the past year, just one workplace in 171 has had a safety or workers’ rights inspection, and not a single employer has been prosecuted and fined for putting workers or the public at risk of contracting covid-19. A staggering 2 million people are paid below the national minimum wage, yet there are currently just 18 employment agency standards inspectors responsible for inspecting 40,000 employment agencies.
Without new funding, the Minister is simply proposing to merge several under-resourced agencies into a single under- resourced agency. The hollowness of the Government’s commitment is underlined by the fact that the post of director of labour market enforcement has been left vacant for the past six months. However, the most glaring omission in this plan is that many of the most exploitative employment practices are perfectly legal.
Bogus self-employment denies millions of workers in the gig economy basic rights and protections, including the national minimum wage, rest breaks and health and safety protections. For those workers it is not a matter of enforcement, because they do not have rights to enforce. They have been totally abandoned by the Government. Will the Minister commit to giving all workers full employment rights to ensure that everyone has dignity and security at work?
On fire and rehire, the Minister says:
“This Government have always been clear that we do not accept fire and rehire as a negotiation tactic.”
These are empty words. The only clear message would be to outlaw the practice. The Government have hidden behind the ACAS report since February, using it as an excuse to do nothing. Today’s announcement that ACAS will be asked to produce further guidance kicks the can down the road yet again. Almost 3 million people—one in 10—have been subjected to fire and rehire since last March.
Allowing working people to be bullied on to lower wages and worse terms and conditions is both morally wrong and economically illiterate. The Government claim to oppose fire and rehire while encouraging it through their inaction because they believe that this one-sided flexibility is good for the economy. How many more millions of workers is the Minister prepared to allow to be fired and rehired before he acts to outlaw the practice?
The proposal to give the certification officer powers to commission investigations and fine trade unions even when there has been no complaint from a member, funded by a levy on trade unions, is an ideological attack on working people. The Minister is proposing to solve a problem that does not exist. The certification officer had a tiny number of cases last year resulting in just one enforcement order. This means that unions will face financial burdens at times when their members are facing hardship, diverting time and resources away from protecting working people to deal with spurious complaints initiated by groups like the TaxPayers’ Alliance rather than fighting for members. If the Minister is genuinely concerned about law-breaking, I suggest he looks closer to home. Staff in his Department are balloting for strike action because of repeated breaches of employment law, including unlawful deductions of wages that force staff to rely on food banks, as well as breaching the working time directive and repeated breaches of Health and Safety Executive covid guidelines.
Trade unions are the best mechanism for protecting workers’ rights, yet the Minister wants to tip the balance of power even further away from them. Compare and contrast this with Joe Biden, who is unshackling and empowering trade unions to rejuvenate the American economy and raise living standards. This Government want to hobble trade unions. The Minister has committed his Government to
“do whatever we can to protect and enhance workers’ rights.”
There is a chasm between the reality and the rhetoric. This is another deceit on working people, but I have news for the Minister: he is fooling nobody.
Paul Scully
The hon. Gentleman talks about enforcement issues and funding. We have more than doubled the budget for minimum wage enforcement and compliance, which is now over £27 million annually, up from £13.2 million in 2015. There are more than 400 HMRC staff involved in enforcement of the minimum wage. We concluded over 2,700 investigations on the minimum wage and returned more than £16.7 million in arrears to over 155,000 workers. We are determined that people should get a fair wage for a fair day’s work. As we build back better, we will build back fairer, and it will not be on the backs of the lowest paid. That is why we will continue to increase the national minimum wage and the national living wage and also to enforce action on transgressions in that area.
On the Health and Safety Executive and what has happened with covid, the HSE has received £14.4 million in extra funding and has conducted 274,000 spot checks in the past year.
Worker status is clearly complicated when we have three issues of the worker, the employer and the self-employed, but that allows us to have a flexible, dynamic labour market that enabled us, after the last recession, to build back better by delivering more jobs than the rest of the EU put together.
On fire and rehire, we hear a lot in this place about a binary choice, but in reality the situation is far more complicated. As we build back better, we want to make sure that we can protect people’s jobs as well as their working conditions. That is why we have to get that balance right. Only we on the Government Benches will deal with the economy and with businesses, but most importantly with workers who are subject to transgression of their workers’ rights by irresponsible employers, yet not just painting all employers with the same brush.
The hon. Gentleman talked about changes to the certification officer’s duties being ideological. Actually, it is adhering to the law, as it is what we said we would do in the Trade Union Act. All we are doing is implementing what was debated properly and agreed in this place under that Act.
We will protect workers’ rights, protect jobs, and create more jobs, and it will be through a flexible, dynamic labour market, getting that balance right. Rather than just having a 1970s-style binary debate, we want to work for 21st-century working conditions.
Mary Robinson (Cheadle) (Con)
I am grateful to my hon. Friend for his statement. Many of my constituents work at Manchester airport and will welcome action to address fire and rehire in the aviation sector. A single body for employment rights is also welcome, but I would encourage the Government to go further and establish a single body for whistleblowers to ensure that they are protected from retaliation and blacklisting and that their concerns are properly investigated. Unfortunately, the current legal framework does not tackle these issues, and the recourse for whistleblowers is the heavily backlogged employment tribunal system, where the average wait for whistleblowing cases is more than two years and the success rate is low. Does my hon. Friend therefore agree with me that it is time for an office of the whistleblower to uphold the right to speak up and strengthen these employment rights even further?
Paul Scully
I am glad that my hon. Friend had the opportunity to meet the Secretary of State recently, and we continue to want to work closely with her and other colleagues on this basis, including my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), who also raises the issue on a regular basis with great knowledge from his constituents. We do recognise how valuable it is that whistleblowers are prepared to shine a light on wrongdoing and believe that they should be able to do so without fear of recriminations. It is right and proper that we review the whistleblowing framework, and we will do that once we have sufficient time to build the necessary evidence of the impact of the most recent reforms, so we will consider the scope and timing of a review.
Douglas Chapman (Dunfermline and West Fife) (SNP) [V]
I thank the Minister for his statement. I know that, across the House, we recognise that strong employment legislation, regulation and guidance help the businesses that respect such standards be more successful, attract more talented and skilled people, and build better teams than those enterprises that play fast and loose with their own employees’ rights.
While the Minister has outlined a number of measures today, with all these things the proof of the pudding will be in the eating. Will the Minister commit to working across the Chamber, with trade unions and employers to ensure that the highest employment law expectations are maintained and enhanced, and the experience of the employee is exactly what it says on the tin when it comes to fair and just working practices? Hon. Members’ casework inboxes are already too full of such cases, and if the Minister were to commit to an annual review of the measures in his statement today, that would help ensure that we were getting this right and protecting workers across the four nations of the UK.
Finally, on fire and rehire, I cannot speak on this subject without praising the work of my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands), and his dogged determination in supporting this campaign and his desire to seek fairness for thousands of employees who have been caught in the sordid, pathetic practice applied by unscrupulous employers. Today was the Government’s chance to right a wrong—a chance to end fire and rehire for good. The question is: why has the Minister not taken that chance to put fire and rehire out of its misery and protect thousands of hard-working people across the four nations?
Paul Scully
I thank the hon. Gentleman. Clearly, as I have said, we do not want to go back to the 1970s binary view of workers’ relations. What we want is a 21st-century view, so of course we will continue to look at and review the impact of legislation, guidance and our work on workers’ rights to check that it is working for a 21st-century economy. We will continue to do that, and we will continue to work with colleagues from either side of the Chamber to hear about constituents’ casework. On fire and rehire, as I have said, nothing is off the table. We are charging ACAS with strengthening the guidance in this area to inform responsible employers how to conduct themselves in this area, but as I say, nothing is off the table.
Darren Jones (Bristol North West) (Lab)
Can I say to the Minister that I am slightly confused by the statement today? He says that the Government say fire and higher is wrong, yet did nothing to intervene to stop its being used inappropriately. He tells us that the single enforcement body will be introduced, which I welcome, but that requires legislation that is not lined up in the Queen’s Speech. This is merely a statement of intent, not a statement of action—a statement of all bark and no bite—so let me ask the Minister: by the end of this year, what will have actually changed?
Paul Scully
In terms of fire and rehire, that guidance will be there. As I have said, fire and rehire in itself is not a binary view. Clearly we need a dynamic labour market. We need to protect businesses from making redundancies and losing those jobs, and we need to save businesses. That is why we are progressing along the way by charging ACAS with strengthening the guidance in this area. We will be working throughout the next few months to make sure, when we have parliamentary time to bring the employment Bill through and create the single employment body, that the guidance will be there and the prep work will have been done.
Richard Fuller (North East Bedfordshire) (Con)
The best form of employment protection is a thriving entrepreneurial business sector open to innovation and creativity. The Minister has already outlined that the UK has an enviable flexible labour market with the highest participation rate of people in work, the highest levels of employment we have seen for many years, the fastest ever increases in the minimum wage and the highest take for the minimum wage as a proportion of average earnings. Rather than going back to the ideological arguments of the Opposition, will my hon. Friend join me in praising the Biggleswade branch of the Department for Work and Pensions, which I was in a conversation with today? It is embarking on promoting the kickstart programme to get more people into work, particularly young people.
Paul Scully
My hon. Friend speaks in his usual eloquent way, talking up the dynamic, flexible economy that makes the UK fantastic and the envy of the world in terms not only of its workers’ rights but its flexibility, which is why we are attracting so much inward investment. I am glad to hear about the Biggleswade jobcentre promoting the kickstart scheme, because it is such initiatives and the extra money we are giving to employers to take on more apprentices that will create levelling-up potential and give people opportunity.
Sarah Olney (Richmond Park) (LD) [V]
I was pleased to hear in the Minister’s statement that he accepts there is still some way to go in securing workers’ rights, particularly for those who are most vulnerable. I am surprised he has not concluded that further legislation is required. If the solution is for the new body that replaces these three existing bodies to go further and do more to enhance and strengthen workers’ rights, there must surely be extra funding available to enable it to fulfil its responsibilities. Can the Minister confirm that?
Paul Scully
We have a good history of increasing the funding for enforcement measures, as I have already outlined. Indeed, the single enforcement body, when we are able to introduce it through legislation, will have sufficient funding not only to do its work, but to transition from those three bodies into one.
Mrs Maria Miller (Basingstoke) (Con)
I welcome the Government’s statement, because a strong economy utilises all the talents of its workforce. Despite some very strong laws, one in four pregnant women or women on maternity leave experienced discrimination during the pandemic. The Minister knows that every year more than 50,000 pregnant women feel that they have no option but to leave their jobs because they are pregnant. Can he confirm that the new enforcement body will be looking specifically at enforcing pregnant women’s rights at work and outlawing the use of non-disclosure agreements to cover up illegal employment rights abuses?
Paul Scully
I congratulate my right hon. Friend on the work that she continues to do in this area. The law is absolutely clear that discrimination in the workplace is unlawful, with clear regulations in place that every employer must follow. The pandemic has not changed any of that. There is no place for that under any circumstances. We believe that the most appropriate way forward for pregnant women and new mothers is to extend the existing framework of protections set out under regulation 10 of the Maternity and Parental Leave etc. Regulations 1999. We will do that by extending redundancy protections for six months for mothers returning to work and ensuring that pregnant women also benefit from these additional protections. We will bring these forward as part of the employment Bill, which will also be the vehicle that will bring the single enforcement body together.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
May I start by saying that I very much look forward to supporting the fire and rehire Bill of the hon. Member for Brent North (Barry Gardiner), now that my own Bill has fallen? After months of warm words for the victims of fire and rehire from the Prime Minister through to the Minister, is this it? What do we have? Guidance that amounts to nothing more than utterly shameful lip service. The statement states:
“It is unacceptable and, frankly, immoral to use the threat of fire and rehire as a negotiating tactic to force through changes to people’s employment contracts”.
I agree, so can the Minister tell us whether employers will still legally be allowed to do so: yes or no?
Paul Scully
I have talked about the fact that fire and rehire should not be used as a bully-boy tactic, but the hon. Gentleman talks about it as if it binary. Can he define exactly what it is? Some of the examples I have heard about over the past year would be considered traditional fire and rehire and would be the subject of this debate, while others have drifted into other areas of employment law.
We need to make sure we can continue the flexibility for employers so that they do not have to make redundancies in the first place, because clearly what would affect those employees badly is not having a job. That is why we need flexibility and dynamism, and we must have measures in place to ensure that responsible employers stick to their responsibilities for the lowest paid.
John McDonnell (Hayes and Harlington) (Lab) [V]
That is possibly one of the most mealy-mouthed, weak-kneed, ineffectual statements that I have ever heard in this House. It is a betrayal of working people. Fire and rehire commenced in my constituency with companies such as British Airways and Heathrow Airport Holdings Ltd, and it spread like a pandemic, harming my constituents. It is galling that these companies have been receiving taxpayer support through furlough, grants, loans and tax reliefs. We need legislation, not guidance that can be ignored. If the Government are to go down the guidance route, will the Minister confirm that they will insist that no grant, loan or tax relief—no taxpayer support—will go to companies that do not abide by this guidance?
Paul Scully
I am sorry that the right hon. Gentleman is not at the Dispatch Box talking about mealy-mouthed statements while throwing Chairman Mao’s little red book at me as I talk about supporting business and workers. We will strengthen the guidance. Nothing is off the table. We will clearly see what is going on. We will work with ACAS and colleagues to see how this lands and look at what happens with irresponsible employers. It should not be used as a bully-boy tactic. It is right that we have wrapped our arms around the economy with £407 billion-worth of fiscal and financial support. We now have 407 billion reasons to shape the economy, allow these businesses to survive, protect jobs and create new jobs so that we can build back better.
Jonathan Gullis (Stoke-on-Trent North) (Con)
Today’s statement will be welcomed across Stoke-on-Trent North, Kidsgrove and Talke. I think of great employers such as Churchill China, whose chief executive officer David O’Connor started on the shop floor and worked his way up. That employer invested in the company and its workers, and workers’ rights gave him the opportunity to go from firing a kiln all the way to running a multimillion-pound business. As a former trade union rep, I find it confusing that the Opposition bemoan the fact that trade unions should have to pay a levy, rather than UK taxpayers. I assume that is because they are worried that there will be less money in the Labour party coffers. Does my hon. Friend agree that there is no reason why trade unions should not pay their own way? Holding trade unions to account, just like holding business to account, is perfectly acceptable.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. We will not have shouting.
Paul Scully
It is great to hear that example of my hon. Friend’s constituent, because that is exactly the kind of flexible, dynamic economy that we are talking about. Someone can come from the shop floor and go right the way to the top of their business. My hon. Friend is absolutely right, as was said in the debate on the Trade Union Act 2016, that unions can now be held to account, alongside other regulators. There are strictures looking at unions to make sure they do a good job for their members.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC) [V]
Diolch yn fawr, Dirprwy Lefarydd. Today’s smoke-and-mirrors announcement—rhetorical, rather than under- pinned by legislation—amplifies this Government’s ongoing failure to introduce a new employment Bill to protect workers’ rights. As we continue to struggle through the pandemic, one thing has become clear: the current approach to bereavement leave and miscarriage leave is insufficient and depends too much on the good will of the employer. Will the Government now consider making paid bereavement leave and paid miscarriage leave an employment right from day one?
Paul Scully
We will continue to work with the right hon. Lady and other colleagues to look at the various issues around neonatal leave and carer’s leave, for example. We have also introduced bereavement leave for newborn children and will look at what more we can do in the employment Bill. She talks about rushing towards legislation, but that should never be the first port of call. It is partnership with employers, employees and government that will ensure a flexible economy that works for everybody.
Mr Richard Holden (North West Durham) (Con)
I thank the Minister for his statement. One of the biggest issues in employment is people having a job in the first place. I am happy to go toe-to-toe any day on our party’s record in government against Labour’s record. Every time the Labour party has been in government, it has left unemployment higher than when it came in. We have had a great record since 2010 on job creation, and we have now created the conditions to bounce back really well, with great job numbers coming through following the covid pandemic. It is also great to see the Government looking properly at fire and rehire. However, one of the biggest issues for workers in my constituency is pensions. It is brilliant to see auto-enrolment come through, which is great for a lot of workers in the workforce, but will the Minister agree to meet me and look at extending that right to all workers over the age of 18? A lot of my constituents start work on the shop floor at 18, rather than after university at 22.
Paul Scully
My hon. Friend is absolutely right when he talks about a dynamic economy, which is why voters turned in their droves to him to represent them in this place, after decades of under-representation. I will gladly meet him to discuss auto-enrolment.
Chris Stephens (Glasgow South West) (SNP)
The irony that the Government are consulting on enforcement powers against trade unions but only on guidance for bad employers is not lost on me. Talking about bad employers, zero-hour contracts, unclear employment status and short-notice shift changes were all mentioned in the Taylor report given to the Government five years ago—no rushing into legislation there. When will the Government legislate on the Taylor report recommendations, or will it be left to other Members to bring forward legislation to address these bad employment practices?
Paul Scully
The hon. Gentleman talks about the certification officer as if it were something new that has just been sprung on people, but clearly it is from the Trade Union Act 2016, so it has been five years, funnily enough. It is only just coming in now because we have tried to get the detail right. As for the legislation from the “Good Work” report that he talked about, the employment Bill will come to this place when parliamentary time allows.
James Sunderland (Bracknell) (Con)
Our business, energy and industrial sectors are pivotal to our economy. Does the Minister agree that the best way of safeguarding jobs and livelihoods for our fantastic workers is to comprehensively ease all covid restrictions in these sectors, and will he please lobby No. 10 to that effect?
Paul Scully
Nobody wants these restrictions to go on a single day longer than they need to. We are in the middle of a frustrating period, with the decision to be made on the 14th of this month. We are looking at the data, and every day that goes by gives us a richer set of data to make the best decision for businesses.
Stephen Timms (East Ham) (Lab) [V]
The case won by the GMB trade union against Uber over the status of its drivers is immensely important, but why are the Government leaving it for these issues to be slugged out, employer by employer, worker group by worker group, in the courts? That is in nobody’s interests, so when will the Government finally bring forward the long-promised employment Bill, which is so urgently needed?
Paul Scully
The Uber judgment that the right hon. Gentleman talks about was a landmark judgment. It is important that we reflect on that, but it is important that Uber, primarily, reflects on that and makes sure that workers are getting their rights, because every worker is different. Indeed, Uber contracts have changed over the last few years, and other companies working in the gig economy have different contracts, so it is complicated, but that is the definition of flexibility and dynamism. None the less, he asked about the employment Bill, and as I have said, it will come forward when parliamentary time allows.
Kevin Hollinrake (Thirsk and Malton) (Con)
I draw the House’s attention to my entry in the Register of Members’ Financial Interests. As a former employer, I absolutely support the Government’s approach to strengthening workers’ rights and stamping out bad practice. When it comes to enforcement, whistleblowers are far more effective at identifying inappropriate behaviour or practices than regulators are. Nevertheless, from a position where the UK used to lead in whistleblower legislation, it has now fallen behind. It is a key area that we could work on to improve the situation. Will my hon. Friend the Minister set out the approach that the Government will take to improve the legislation?
Paul Scully
I am grateful for my hon. Friend’s work in this area. I am looking forward to meeting him and his colleagues to discuss it further, to get his knowledge and the experience of his constituent, who has been put in an incredibly tough and invidious position. As I say, we will review the whistleblowing framework once we have had sufficient time to build the necessary evidence, which will include that conversation. We are considering the scope and timing of the review.
Madam Deputy Speaker (Dame Eleanor Laing)
It would be helpful if we could go a little faster, because the House has a lot of business before it over the rest of the day.
Charlotte Nichols (Warrington North) (Lab) [V]
Polling for the GMB union found that 76% of the public want fire and rehire to be banned, including 71% of Conservative voters. If only unscrupulous employers use fire-and-rehire tactics, as the Minister said in a previous answer, a non-legislative solution will do absolutely nothing. How much more consensus is needed before the Minister acts to ban fire and rehire, rather than warm words that do nothing to protect workers in his constituency or mine?
Paul Scully
I have noticed that I can shrink my long list of responsibilities in the ministerial portfolio down to Minister for unintended consequences. I do not want to have a series of legislation, which is a blunt instrument, as if it is tackling a binary tool. That would have unintended consequences for people’s jobs and livelihoods. We want to have a flexible economy so that we get both right.
Mark Pawsey (Rugby) (Con) [V]
I welcome the way in which the Minister is today extending the rights of the most important asset of any business, which is people. I am sure he will agree how essential it is to ensure that flexibilities enable workers to work the hours that suit them best, while also allowing employers to respond to the changing demands of their customers.
Paul Scully
My hon. Friend is absolutely right. We need flexibility in the workplace, including so-called zero-hours contracts, for example. We know that the majority of people who work on zero-hours contracts like the flexibility. However, we want to ensure that we can clamp down on things like exclusivity contracts, which is why we banned those. It is important to get the balance right.
Kirsten Oswald (East Renfrewshire) (SNP)
The Minister just said that the UK Government will do whatever is needed to enhance and protect workers’ rights, but all he is doing on fire and rehire is to provide more guidance. That is shameful—guidance is not what is needed. We needed to hear about legislation to stop fire and rehire, to outlaw pregnancy and maternity discrimination, and to give flexible-working rights from day one to protect precarious workers, but the UK Government will plainly not do what is needed on employment. Does the Minister appreciate that what is needed now is to devolve this to the Scottish Parliament so that it can do what is needed?
Paul Scully
If the hon. Lady reads the ACAS report, she will see that there is a divergence and a variety of opinions, as well as a wider evidence base about the extent of use and how that is used. That is why we are coming up with a proportionate response. Clearly, the other issues she raises will be in the employment Bill when parliamentary time allows.
Selaine Saxby (North Devon) (Con)
I know my hon. Friend understands that right hon. and hon. Members across the House want the UK to be on the front foot on workers’ rights after we leave the EU. Will he offer me a categorical assurance that that will be the case and that there will be no degradation in our world-leading protection?
Paul Scully
Yes, absolutely that is the case. We are determined to ensure that this is the best place not only to set up and have a business, but to work—for workers’ rights, high pay and a highly productive economy. That can only be done by valuing our people.
Rachael Maskell (York Central) (Lab/Co-op) [V]
I refer to my entry in the Register of Members’ Financial Interests. The Government may talk about enhancing employment rights, but they never act and never legislate. Recently, workers in York were being forced on to new contracts until a joint intervention by Unite and me, as a Labour MP, stopped the firing and rehiring. I know it is embarrassing for the Minister to have to defend his Government’s empty promises, dither and delay, but to stop bad employers constantly undermining their workers, we need not more guidance, but legislation. Will he bring forward a Government Bill to end fire-and-rehire practices in this parliamentary Session, which should also insist that any changes to contractual terms are negotiated with workers and their trade unions?
Paul Scully
I have outlined what we are doing around fire and rehire. Extra and enhanced workers’ rights will come in the employment Bill. The workers the hon. Lady describes have recourse, through ACAS and employment tribunals, to take their employers to task.
Laura Farris (Newbury) (Con)
I welcome today’s announcement. My hon. Friend is quite right to point out the nuance in fire and rehire. Speaking as an employment barrister, I stress that the issue that we lawyers have had is that the employer is required to show only that it is a genuine reason—in other words, low profitability. They are not required to show that they have exhausted every other option, and I welcome the fact that that is now a devolved function of ACAS. Will he consider putting the last resort clause into primary legislation—either the Employment Rights Act 1996 or the new Bill—to give employees rights to go to tribunal?
Paul Scully
I thank my hon. Friend, as ever, for her considered response in this area, with the expertise that she brings to bear. Clearly, as I say, nothing is off the table. We are putting the guidance in place with ACAS, but we will look at more measures should we need to.
Point of Order
(3 years, 6 months ago)
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Mr Kevan Jones (North Durham) (Lab)
On a point of order, Madam Deputy Speaker. Last month, I received from a constituent some serious allegations about the conduct of individuals in the cosmetic surgery industry. The allegations involved a surgeon who had been struck off the General Medical Council register in this country, but who was conducting consultations with UK patients via Zoom, from a private clinic overseas. A separate allegation was that a doctor in the UK continued to refer patients to the struck-off surgeon, and that his services were being advertised on UK-based websites.
On 20 May, I wrote to the Minister for Patient Safety, Suicide Prevention and Mental Health, the hon. Member for Mid Bedfordshire (Ms Dorries). On 3 June, I received a direct response to my letter. Lo and behold, it was not from the Minister, but from the CEO of Transform Hospital Group, a private company. I know that it was a direct response because the CEO actually states that he had received my letter directly from the Care Quality Commission.
I take an extremely dim view of my correspondence with the Minister being passed on to a private company without my knowledge or consent. I consider that a major breach not only of confidentiality, but of my trust and that of my constituent who made the complaint in the first place. I do not think a Minister’s correspondence should ever be shared with a private company, breaking the bond of trust that we have with our constituents. I seek your advice, Madam Deputy Speaker, on how I can rectify this and ensure that it does not happen again.
Madam Deputy Speaker (Dame Eleanor Laing)
I am grateful to the right hon. Gentleman for having given me notice of his intention to raise this point of order. Mr Speaker shares his concern that sensitive correspondence appears to have been passed from the Department to a private company for a response, and Mr Speaker will be drawing this matter to the attention of the Leader of the House to ensure that these important issues are understood across Government and not only by the people who are paying attention to this particular point of order this afternoon.
The 2016 guidance produced by the Cabinet Office on the handling of parliamentarians’ correspondence goes into some detail, which I will not quote in full now, but the right hon. Gentleman is right in pointing out that that guidance says that
“departments should treat correspondence with great care to ensure that confidentiality is not broken.”
It also states that
“official replies to letters from MPs should only be authorised in exceptional circumstances”.
It would appear that guidance has possibly not been followed in this case.
I would have said to the right hon. Gentleman that I would make sure that the Minister gives an answer, but I am delighted to say that the Minister in question is here in the Chamber, so I shall call her to respond to the point made by the right hon. Gentleman.
The Minister for Patient Safety, Suicide Prevention and Mental Health (Ms Nadine Dorries)
Further to that point of order, Madam Deputy Speaker. I thank the right hon. Member for North Durham (Mr Jones) for the advance notice of his point of order, because the very short time that I have had has enabled me to do some investigation, and enabled officials to investigate, to find out what has happened.
The chronology is that the Department was passed a letter sent to me by the right hon. Gentleman on 26 May. The letter raised some very serious concerns about the conduct of a doctor working for a cosmetic-surgery provider referring UK patients for consultations with a former doctor who was struck off by the General Medical Council in August 2020 and is now based in Italy.
The right hon. Gentleman and I have had a number of conversations about the cosmetics industry and issues of this nature, so he will understand why I have taken this matter so seriously. Due to the nature of the allegations and the potential implications for patient safety—which I take very seriously, particularly when they pertain to women—my Department raised the issues set out in the letter with the GMC and it was also passed to the Care Quality Commission, which is responsible for regulating providers of cosmetic surgery in England, to enable it to consider the issues that were raised. The CQC needed to go back to the provider to find out whether the allegations were true and what had happened.
I take the complaints very seriously. I assure the right hon. Gentleman that, as he is aware—we have spoken about this—I had not even seen the letter yet myself. I can only believe that the letter was shared with the GMC and the CQC to ascertain what happened in order to inform a letter that I would then send to the right hon. Gentleman. I have yet to see the letter. I take these complaints incredibly seriously and my Department is reviewing how this information and the letter were handled and how the information was leaked. I will write to the right hon. Gentleman once our inquiries have been satisfied and, as he and I have previously discussed, I shall also write to his constituent.
Madam Deputy Speaker
I hope that the right hon. Gentleman is satisfied that the point that he has raised has been taken very seriously by the Minister. The House will be pleased to know that the Minister and her Department are taking this matter very seriously indeed, and I will happily tell Mr Speaker that that is the case.
I shall now briefly suspend the House for three minutes in order that arrangements can be made for the next item of business.
0.7% Official Development Assistance Target
(3 years, 6 months ago)
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Mr Andrew Mitchell (Sutton Coldfield) (Con)
I beg to move,
That this House has considered the matter of the 0.7% official development assistance target.
I draw the House’s attention to my entry in the Register of Members’ Financial Interests.
Mr Speaker, yesterday you made one of the strongest statements that I have heard from the Chair in more than 30 years, and you made it clear that the House should receive from the Government a meaningful vote. Naturally, in accordance with what you have said, we do not seek to divide the House on the motion today. We seek the meaningful vote that will enable the House to decide whether the Government can break our promise and arguably our law.
I see that my right hon. and hon. Friends and I are described as rebels. It is the Government who are rebelling against their clear and indisputable commitments. Who are these so-called rebels? A short perusal of yesterday’s Order Paper shows that we have among our number eight Select Committee Chairs, four distinguished former Select Committee Chairs, 16 former Ministers, 12 Privy Counsellors and four knights of the realm. From the new intake, my hon. Friends the Members for Totnes (Anthony Mangnall), for Milton Keynes North (Ben Everitt), for Bury South (Christian Wakeford), for Penrith and The Border (Dr Hudson) and for Keighley (Robbie Moore), along with others who have recently arrived in this House, have shown great courage and determination in the face of the possibility of being tarred and feathered by the Government Whips Office.
We are also supported by every former Prime Minister and, I believe, by every former leader of all four major political parties. Over the weekend, the Archbishop of Canterbury said:
“The foreign aid cut is indefensible…Let us…pray”
that it is reversed
“and that our unconscionable broken promise to the world’s poorest people is put right.”
All four distinguished current or former Chairs of the Public Accounts Committee who are in the House support our cause. My right hon. Friend the Member for Gainsborough (Sir Edward Leigh) describes himself as the last Thatcherite on the Government Benches.
Mr Mitchell
My right hon. Friend the Member for Haltemprice and Howden (Mr Davis) might possibly wish to disagree there. My right hon. Friend the Member for Gainsborough said:
“There is no public accounting justification for slashing budgets by 80% in this way. It is like telling the builder before he finishes your garden wall that you won’t pay at the end. Cancelling projects overseas is just a waste of taxpayers’ money when we should be providing long-term stability for schools, clinics and clean water projects.”
Jim Shannon (Strangford) (DUP)
I congratulate the right hon. Gentleman on bringing the matter forward. The House is very much united behind him. It is not just the scale of the aid cuts, but the speed of the enforced shutdown of operations that is hugely harmful. Aid and development are not a tap that we can turn off and on whenever we like. It is time for the Government, on this occasion, to step up to the spot and make sure that they reinforce the aid budget and increase it back to what it was in the past.
Mr Speaker
May I just gently say that we have a lot of speakers and I want to hear from everybody? If you are going to intervene, I am sure that you will understand if you go down the speaking list.
Mr Mitchell
The hon. Gentleman is absolutely right. Of course, what he says has been reinforced by every single member of his party who serves in the House, and it is the point that my right hon. Friend the Member for Gainsborough, a former Chairman of the Public Accounts Committee, was making: if we turn this expenditure on and off in this way, the taxpayer does not get proper value for money.
Nor is this about party politics. All 650 of us elected to this House at the last election promised to stand by the 0.7%. The Bill enshrining the 0.7% in law was passed unwhipped in this House, with just six dissenters. Outside the House, in every single constituency in the country, there are people taking action as part of Crack the Crises, the growing environment and development group. Each and every one of us is accountable to those constituents, who are taking action in their local schools, colleges, churches, mosques, charity shops, women’s institute branches, congregations and community groups.
Twelve million people—an average of 15,000 per parliamentary constituency—are supporters of the member organisations of that coalition, and they must be heard. The people who sponsor children through development organisations, the members of churches that are twinned with others in the developing world, the people who were there for Jubilee 2000 and for Make Poverty History—they do not forget when we break our promises to them; they organise.
I can assure the House that, were it not for the covid restrictions, the same people who made the human chain around the Birmingham G8 summit and the quarter of a million people who marched on Edinburgh before the Gleneagles G8 would be preparing today to descend on Cornwall to make their views known at this G7 and to protest this unethical and unlawful betrayal. They would be joined by a whole new generation of young people who are watching this Government break our promise to the world’s poorest. They do not like what they see. This weekend, they may not be on the streets, but they will be watching, and they will remember.
For two decades, the UK has been a development leader, not just because that is morally right and accords with our values, but because it is in our own national interest. By making the countries we seek to help safer and more prosperous, we make life for ourselves here in Britain safer and more prosperous.
Sir Bernard Jenkin (Harwich and North Essex) (Con)
My right hon. Friend has been courteous and persuasive in trying to get me to join his cause, but I have declined to do so because I think that the Government are doing precisely what he describes but in ways that do not qualify as aid. I have asked the Government to clarify all the other things that we are doing that are contributing to the reduction of global poverty and, indeed, what we will do with the vaccine programmes to contribute to the alleviation of disease and distress in the poorest countries.
Mr Mitchell
I very much hope that my hon. Friend will stay for the whole debate so that he hears the views across the House. I am sure that will be both instructive and interesting for him.
Mr Speaker, the way the Government are behaving strikes at the heart of our Parliament, as you set out from the Chair yesterday. We cannot secure a meaningful vote. Had we been able to do so yesterday, as I intimated to the House, we would definitely have won by nine, and probably by nearer 20. It is precisely because the Government fear that they would lose that they are not calling a vote. That is not democracy. When countries behave like that in Africa, we British say that they have got it wrong. The Government need to remember that the Government and the Executive are accountable to Parliament, not the other way round, and most especially on issues of supply, as the Minister—he is a very good Minister—knows. That applies in all circumstances, whether the Executive are being run by King Charles I or Boris Johnson.
The Government make two key arguments: first, that they are still spending a huge amount of money—I am sure that is what my right hon. Friend the Minister will say this afternoon—and, secondly, that we are living in unprecedented times for our economy and they will bring the 0.7% back. Let me start with the first—that we are still spending a huge amount of money. Of course, that is entirely correct, but we all promised to spend 0.7% of our GNI, not to change the target and spend 0.5%. All of us made that promise—I have seen every single Member’s manifesto at the last election, and every single elected Member made that promise.
It is arguable, at the least, that the action the Government are taking is unlawful. One of the most senior and distinguished lawyers in the country, the warden of Wadham, Oxford, a former Director of Public Prosecutions, has made it clear that the Government are acting unlawfully because they have changed, rather than missed, the target. I argue to the House this afternoon that what the Government are doing is unethical, possibly illegal and certainly breaks our promise.
On the point about the level of expenditure and the £10 billion, it is rather like buying a car and shaking hands on a deal at 15 grand, only to do a runner while the poor fellow is counting the cash after you have legged it, having handed over only 10 grand. It is not proper, it is fundamentally un-British and we should not behave in this way. It is about the girl whose school closed in South Sudan last week after the headteacher read the letter from the Foreign Office explaining that it is only temporary.
The second argument is that we live in unprecedented economic times and that the Government will bring the 0.7% back, but the 0.7% is configured precisely to take account of our economy. When the economy contracts and goes down, so does the amount of money spent under the 0.7%, and when it increases, that amount goes back up. We are talking about 1% of the money that the Treasury quite rightly spent on covid last year to sustain and support jobs, families and employment. This is 1%—it is practically a rounding error in my right hon. Friend’s books.
We offered an olive branch to the Government last night, which the Government could have accepted, and then we could all have cracked on with other things, by asking them to bring the 0.7% back next year. We accept that they are not going to bring it back this year, but we asked them to bring it back next year, when the Governor of the Bank of England says that the economy will have rebounded to pre-covid levels and growth will be strong. If the Government were serious about bringing it back when the economy improved, they would have accepted the olive branch that my right hon. and hon. Friends and I offered.
Everyone knows what this is about. It is not about the 1% rounding error in the Treasury’s books. It is about the red wall seats. The Government think that it is popular in the red wall seats to stop British aid money going overseas. Indeed, one Treasury Minister told me that 81% of people in the red wall seats do not approve of spending British taxpayers’ money overseas. But we have to be careful about the question we ask, because other polling in the red wall seats shows that 92% of people there do not approve of cutting humanitarian aid. It is also a very patronising attitude to people who live in the red wall seats, because when these dreadful famines, disasters and floods take place, it is the people in the red wall seats who are the first to raise money through car boot sales and pub quizzes to try to help those who are caught. In the words of Talleyrand, the French statesman, this is worse than a crime; it is a mistake. What my right hon. and hon. Friends and I—the so-called rebels—are trying to do is to keep the Government straight.
And so we come to this week’s G7 summit, when the leaders of the richest nations will assemble in Cornwall. My right hon. Friend the Prime Minister will be chairing the summit, and he goes into it in the teeth of a global pandemic, when Britain is cutting its support to the poorest. No other country represented at the G7 is doing such a thing. The French have now embraced the 0.7%. The Germans will spend more than 0.7% this year. The Americans—by far the biggest funders in the world—are seeking an increase through Congress of $14 billion in the amount that is spent. We are the only ones going backwards.
Other G7 countries are noticing what the Government are doing. Is it any wonder that, in a letter to President Biden, a dozen Members of Congress have urged him to upbraid Britain for breaking its promise? One sentence in their letter made me wince. It reads as follows:
“Cutting back on foreign assistance during the worst humanitarian crisis of our generation only undermines our collective global response.”
This is what the journalist who used to serve in this House and who probably understands the Conservative party best said at the weekend:
“Try though seasick government whips will to mount one, there is no civilised defence of this cut. This cut looks like what it is: a cheap and brutal gesture, a piece of domestic applause-seeking”.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
The right hon. Gentleman is making a brilliant speech. I just want to flush out one point, which I hope will be a point of consensus. It is possible that this weekend we will get agreement on a fresh issue of $650 billion in special drawing rights. The UK will have surplus SDRs and it is possible that they could be recycled to support aid. It would be a regrettable accounting trick if that, in any way, counted towards making good the cut that has been made. Is that a point of consensus across the House?
Mr Mitchell
The right hon. Gentleman makes a good and useful point, and the decisions made on the SDRs will be extremely helpful.
We come, finally, to the essence of all of this. Because of the way the development budget is configured, these terrible cuts are falling first and hardest on the humanitarian sectors. Let me just mention four of them. The first is girls’ education. The Prime Minister has rightly said that it is his main aspiration on these international development issues—this is strongly supported by my hon. Friend the Member for West Worcestershire (Harriett Baldwin)—to ensure that all girls get 12 years of quality education. That is a wonderful and noble British initiative, but what has happened to the funding? It has been cut by 25%. So on the one hand we have the words—the aspiration—and on the other we have the reality of the 25% cut. Worse than that, UNICEF, which has a fantastic reputation and which the British Government judged just a few years ago to be the most effective of all the UN agencies, has had a cut of 60%. On clean water and sanitation, which is pivotal if we are to conquer this pandemic among the poorest of the world, some 10 million people who were expecting to receive British taxpayers’ support will not now get it. Funding to the UN to save the lives of people suffering with HIV/AIDS has been cut by 80%, which is a death sentence for the people who would have been helped. Finally, we are going to end food assistance for 250,000 people. These are not people who have missed eating for a few days; they are people who are starving, and we are going to cut our support for them directly.
I have never forgotten the experience I had as Development Secretary in Karamoja, in northern Uganda, where I stood under a tree next to a football pitch, which was covered by children who were starving. There were about 200 children there and they were waiting in line. They were suffering from acute malnutrition, and British taxpayers’ money and British humanitarian workers were trying to help them. If we catch them early enough, when they are floppy but not actually medically critical, we give them Plumpy’Nut, a biscuity peanut substance that costs about a 5p a head, and they will be recovered in about an hour and probably running around playing football. However, if we miss that point, they have to go to a clinic, have a drip up and it costs about $180 to put them right.
Steve Brine (Winchester) (Con)
Does what my right hon. Friend has just said about the 5p not make the point that, although £4 billion is a small amount for a rich country such as ours, it makes an enormous difference in the countries we are trying to help?
Mr Mitchell
My hon. Friend is absolutely right and he puts it enormously eloquently. I end my remarks by saying that that story from Karamoja in northern Uganda has lived with me from the day I saw those things. I will be thinking of those children in this debate and I urge my right hon. and hon. Friends to think about them as well.
Mr Speaker
May I just say that brevity from everybody will allow more Members to get in? Those who intervene will not mind being moved down, because that is the way we are going to help each other.
Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)
I thank my friend, the right hon. Member for Sutton Coldfield (Mr Mitchell), for his great work in securing this debate, and the many other Members from across this House and the other place with a keen interest in this issue.
It is a great shame that the Government have had to be forced into this debate today when they promised more than six months ago that they would bring legislation to Parliament to ask elected Members of this House whether they supported these cuts to the aid budget. I thank you, Mr Speaker, for your support in allowing this debate.
We clearly have a Government in hiding—a Government who have tried over and again to avoid scrutiny and accountability for the cuts that they have imposed, drip feeding information on where the cuts are falling and refusing to release the impact assessments or rationale behind any of those decisions. We have been given conflicting accounts on whether impact assessments have actually been carried out on the cuts, suggesting either that the Secretary of State failed to ask for any, in which case he is clearly out of his depth, or that he is afraid of the public learning the true impact of the cuts and the lives lost. So, which is it? We are no strangers to hyperbole in this House, but it really is no exaggeration to say that the cuts to the aid budget by this Government have cost people their lives. It is utterly shameful.
Let us not pretend that Foreign, Commonwealth and Development Office Ministers are not ashamed of the cuts foisted on them by the Chancellor and waved through by a Prime Minister either too weak or too incompetent to impose them. The Secretary of State and his Ministers are the ones who have had to front debates, meet their counterparts and post videos, talking about the importance of clean water and sanitation, while slashing funding by 80%, meaning that 8 million fewer women and girls will have access to the most basic necessity of water. Then there is the life-changing impact on girls’ education—a priority, says the Prime Minister, as he hopes no one notices him cutting the education budget by 40%, meaning that 700,000 fewer girls will receive an education.
The Government say that Britain’s focus should be on human rights, but they have halved the funding to the human rights, democracy, and rules-based international system programme. Why should we or the British public trust a word that this Government say?
Yesterday, Members of Parliament from across the House were ready to show that they did not support this Government’s callous and counterproductive cuts to the aid budget, because the real consequences are already being felt in Britain as well as across the world. The Secretary of State has made a 70% cut in funding to research programmes tracking covid-19 variants of concern around the world, including the Delta variant, making the British public less safe.
Britain has built up a reputation as a global development power, thanks to our aid commitment, our dedicated development workers, our academics, and our researchers and scientists, strengthening our position in the world with both our allies and detractors. This Government are tarnishing our global reputation, and tarnishing our soft power and our national interest. As the right hon. Member for Sutton Coldfield mentioned, the US Democrats have said:
“Cutting back on foreign assistance during the worst humanitarian crisis of our generation only undermines our collective global response”
to the pandemic. They are right. With days to go until the G7 summit, choosing to continue with this cut would see the Government persist not only in undermining the UK’s credibility on the world stage, but in ignoring their commitment to the world’s poorest and the most vulnerable people on earth. Britain is a proud, generous and caring country, and these cuts are an insult to the British people and our proud tradition of showing humanity and leadership on the world stage. Members of the US Congress and the Biden Administration are already warning the Prime Minister about the impact of these aid cuts.
During this deadly pandemic, global leadership and unity are more important than ever, but as the only G7 nation to cut aid and the third lowest donor this year, this signals a retreat—so much for global Britain. If we are to assert ourselves on the world stage, we must be a country that looks outwards—a country that builds relationships outside our borders to tackle the global challenges of the future. This Government have a choice: continue down a path that will cost more lives or listen to colleagues today across Parliament and end this retreat by reinstating our commitment to 0.7% as a matter of urgency.
The Chief Secretary to the Treasury (Steve Barclay)
Let me begin by acknowledging the words and the good intentions of my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell). He knows as well as I do that decisions such as this are not easy. In short, this is a hugely difficult economic and fiscal situation that requires difficult actions.
Responding to twin health and economic emergencies, the Government have acted on a scale unmatched in recent history to protect people’s jobs and livelihoods and to support businesses and public services, paying out £352 billion in support since the start of the pandemic last year. That is equivalent to 17% of GDP and one of the largest fiscal support packages of any country in the world.
Our plan is working. The economy grew by 2.1% in March alone, and the Bank of England now expects the economy to return to its pre-crisis levels by the end of this year—two quarters earlier than previously expected. At the beginning of the crisis, unemployment was forecast to reach 12% or more. The latest projections show that it is due to peak at 5.5%, meaning that almost 2 million fewer people will lose their jobs than was expected last spring.
As the House will note, however, much of that response has relied on borrowing. Last year saw the highest peacetime levels of borrowing on record—£300 billion of borrowing—and we are forecast to borrow £234 billion more this year and a further £109 billion the following year, so without corrective action, borrowing would continue at untenable levels, leaving underlying debt rising indefinitely. At our higher level of debt, the public finances are more vulnerable to changes in inflation and interest rates. Indeed, a sustained increase in inflation and interest rates of just 1% would increase debt interest level spending by over £25 billion in 2025-26. The goal of any Government should be sustainable finances, and the current level of borrowing is not sustainable.
My right hon. Friend the Member for Sutton Coldfield used a number of emotive terms around the morality of the context of these changes, but leaving the next generation vulnerable to the degree of fiscal threat that would be entailed with a high debt level is not itself morally sound. At the same time, loading ourselves with more debt now might well damage our ability to spend on aid later. There are some in this House who say that since we are already borrowing to protect jobs and businesses, what is £4 billion more? Indeed, that was the nature of the intervention from my hon. Friend the Member for Winchester (Steve Brine). Crucially, the only reason we were able to act during the pandemic in the way that we did is that we came into the crisis with strong public finances, and we believe it is our duty as the economy recovers to return to a sustainable fiscal position.
Harriett Baldwin (West Worcestershire) (Con)
I thank the Chief Secretary to the Treasury for giving way and I appreciate his fiscal stance, but can he explain to the House why the only manifesto pledge he has chosen to break is the one that forces the World Food Programme in South Sudan to choose between feeding hungry children and feeding starving children?
Steve Barclay
The point is that we have made a number of difficult decisions, and I will come on to that, but we are also continuing to spend £10 billion in response to the commitments that we have made. I am sure that my hon. Friend, as a former Treasury Minister, is well aware of the fiscal reality we face.
Strong public finances mean making difficult decisions, such as increasing corporation tax. That is one of the difficult decisions that my right hon. Friend the Chancellor has made, alongside the decision around overseas aid. Indeed, this is something that the International Development (Official Development Assistance Target) Act 2015 explicitly anticipates when it refers to the effects of one or more of the following:
“(a) economic circumstances and, in particular, any substantial change in gross national income;
(b) fiscal circumstances and, in particular, the likely impact of meeting the target on taxation, public spending and public borrowing;
(c) circumstances arising outside the United Kingdom.”
In other words, the 2015 Act clearly envisages situations in which a departure from the target may be necessary. It provides for the Secretary of State’s accountability to Parliament by way of the requirement to lay a statement before Parliament and, if relevant, makes reference to economic and fiscal circumstances, as well as circumstances outside the United Kingdom. Indeed, the Foreign Secretary has already committed to doing that, as required by the Act.
Sarah Champion (Rotherham) (Lab)
That accounts for the cuts in July, but surely it was a political decision, and potentially an unlawful one, to cut to 0.5% in November.
Steve Barclay
The provisional data shows that for the 2020 ODA figures, the 0.7% was met. The point is that the Act allows for the economic and fiscal instance that I just set out—it is in section 2. If the UK were to spend 0.7% of gross national income as ODA, it would cost the country an additional £4.3 billion this year. Given our commitment to fiscal sustainability, we could offset that either by raising taxes or by cutting public spending. [Interruption.] We can come on to that. To put that in context, it means a 1p increase in the basic rate of income tax or about a 1% increase in the standard rate of VAT at a time when taxes are at a historical high.
Mr Mitchell
The Treasury really must do better than that, because 1p on income tax is worth nearly £6 billion, so the increase would be much less than 1p.
Steve Barclay
In the context, it is £5 billion to £6 billion. My right hon. Friend did not set out in his speech how he would address that gap. Which fiscal measures was he suggesting? Was he suggesting a specific tax, in which case I did not hear that in his remarks? Was he suggesting more borrowing, in which case one needs to look at the impact on our stock? Was he, in fact, suggesting spending? [Interruption.] From a sedentary position, the right hon. Member for Ashton-under-Lyne (Angela Rayner) mentions Test and Trace. Given that 80% of the Test and Trace budget relates to testing, if she is saying that she wants to get rid of PCR testing or lateral flow testing, she needs to set that out in detail. That speaks to the lack of detail provided; it is strikingly absent from the alternatives put forward.
The fundamental point before the House is that the scale of our overseas aid remains significant. In fact, we continue to lead the world in overseas development. This year we will spend more than £10 million to improve global health, fight poverty and tackle climate change, including £400 million on girls’ education in 25 countries, and we are doubling to £11.6 billion our commitment to international climate finance for the period 2021 to 2026, with at least £3 billion for climate change solutions that will protect and restore nature and biodiversity. According to the OECD, in 2020 we were one of only two G7 countries to actually meet the 0.7% target and the only country to do so each year since 2013. Even after the change we are debating today, we are still the third largest donor in the G7 as a percentage of gross national income, and 0.5% is considerably more than the 29 countries on the OECD’s Development Assistance Committee, which average just 0.41%.
Importantly, the Foreign Office makes its aid spending choices based on maximum impact, coherence and value for money. The Integrated Review has reaffirmed our pledge to fight against global poverty and to achieve the UN sustainability development goals by 2030. We are the fifth largest contributor to the UN peacekeeping budget, the third largest bilateral humanitarian donor, the second largest member state donor to the World Health Organisation, and among the world’s largest donors to the COVAX advance market commitment—the global initiative supporting developing countries with access to vaccines. The funding we will continue to make available to countries all over the world is helping to educate young girls, boosting diversity, tackling climate change, vaccinating the needy against deadly diseases such as Ebola and malaria, and improving the nutrition of staple food crops—millions of lives improved, millions of lives saved.
This is a generous and outward-looking country whose impulse has always been to help others around the world. We do not and we will not shy away from making a determined contribution to addressing the world’s problems. But at the tail end of a huge economic emergency, we also have a responsibility to the British people. We are absolutely clear about our intention to return to 0.7% of our national income on overseas aid when the fiscal situation allows, but cannot do so yet. We will, however, keep the matter under careful and regular review. I know that Members on both sides of the House will make their cases cogently and passionately, but for now, the tough choice is the right choice.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
I cannot help but reflect, given what the Minister has delivered, that in the phrase that is often used, he knows the price of everything and the value of nothing.
Let me begin by commending the efforts of all those who have made it possible to have this emergency debate, including those who requested the debate, led by the right hon. Member for Sutton Coldfield (Mr Mitchell), and you of course, Mr Speaker, for granting time today.
As we know, it has not been an easy task getting to this point—a point where this Government have finally been held accountable for their actions and made to answer for what is a callous cut to overseas aid. Let us be very clear: this Tory Government have been shamed into coming to the House today. Ever since announcing this disgraceful decision to slash aid for the world’s poorest, the Government have been on the run on this issue. For weeks now they have avoided questions and dodged accountability, but they have been dragged to the Dispatch Box today.
As usual with this Government, the person most responsible for the decision to cut aid is the person first to hide and the last to face accountability. On an issue of this importance and a policy this fundamental, it tells us everything we need to know about this Prime Minister that he does not even have the guts to come before this House to justify his Government’s decision to cut support to those most in need. He is a Prime Minister who casually signs off on these devastating decisions, but a leader who always fails to take any responsibility for the consequences of such decisions.
No damaging decision appears to be off limits for this Government. On overseas aid, living up to our legal responsibilities—our legal responsibilities, Minister—to those most in need should unite various strands of political opinion across this Parliament. Instead, the moral mission of 0.7% spending has been shamefully undermined by a morally bankrupt Government.
It is important to put the decision into a broader context, because cutting the aid budget is not only cruel and counterproductive in its own terms, but an isolated act from a UK Government increasingly alone on the world stage. The UK is virtually the only country that has cut its aid spending. Nearly every other wealthy country has recognised the greater necessity of helping those in need at this unprecedented time of a humanitarian crisis.
The Government’s timing could not be worse. International opinion on these cuts is crystal clear. It is rightly seen as a disgraceful abdication of the UK’s international responsibilities in a year—in a year, Minister —when we should be showing some international leadership at the G7 and COP26. Let us simply take a look at what some G7 countries are doing in comparison with the UK. This year, Canada’s aid budget will see an increase of 28%, France will contribute a 36% increase and, under the Biden Administration, the US will see a 39.4% increase. Yet this Tory Government think it is somehow morally justified to impose these cuts. It is morally and ethically flawed, it is intellectually flawed and it shames all of us that this is done in our name. But I say this to the Minister: it is not done in the name of the majority who have been sent to this House.
The harsh reality is that this decision will cost lives—it will cost lives, Minister. Brexit Britain is rapidly exposing the future it offers of being out of step and out of influence on the world stage, because one thing is for sure: if the Tory Government dig in their heels and slash the aid budget, they are adding insult to injury to those dwindling few who still desperately cling on to the notion of global Britain.
Digging into the details of these cuts reveals what is at stake if they are allowed to continue. The headline figures are stark enough in themselves, with aid spending amounting to £10 billion this year, compared with £14.5 billion in 2020, but it is the impact of where exactly the cuts will fall that tells the real story and exposes the real damage. Almost unbelievably, conflict zones face some of the worst cuts. Syria, Somalia, the Democratic Republic of the Congo, Libya, Nigeria and Lebanon: all are poised to lose more than half their funding. Is that where we stand? Is that where the Minister stands? Is that where his Government stand?
Children are the next target. The United Nations Children’s Fund faces a cut of 60%. This is harrowing; this is heartbreaking. I ask the Minister: where is the Government’s humanity at a time of need?
Some of the most established and impactful projects are equally at risk, with cuts of £12.5 million to the UN agency that fights AIDS and HIV. That is more than an 80% cut to a programme to fight AIDS, condemning people to an early death that could be avoidable.
Much has already been made of the fact that, by imposing these aid cuts, the Government are brazenly breaking their own manifesto commitment. In particular, I want to draw attention to the fact that they are breaking a very specific commitment that they made to voters about girls’ education right across the globe. It is worth putting that on the record of the House. In 2019, the Conservative party manifesto promised to
“stand up for the right of every girl in the world to have 12 years of quality education”,
and yet that promise has been broken.
Analysis by Save the Children shows that spending on education for girls will be reduced by at least 25%, compared with 2019-20 levels. That is horrific. Not only will these cuts impact now, but the damage will reverberate into the future for those young girls and young women, their hopes and fears crashed on the dogma of the desire to cut UK aid spending. Only this weekend, a letter from 1,700 charities and academics said that families are going hungry and girls are missing school as a direct result of these decisions. I can see that the Minister is nodding. I ask him please to reflect and change the Government’s policy and what they are doing.
Whether the promises are broad or specific, they are apparently all the same to the UK Government, who are telling people that they think their promises are only there to be broken. I acknowledge and give credit to the courage of the many Conservative Back Benchers who have stood against their Prime Minister, who is reneging on the very manifesto that he stood on. Their stance has given us at least a chance to face down the Government on this issue and hopefully force a U-turn.
Frome a Scottish perspective, I cannot hide my genuine disappointment that we cannot count the Scottish Tories among the Conservative Back Benchers with a backbone. For weeks, they have maintained a deafening and shameful silence, but even at this late stage, they have the chance to do the right thing. Whatever our differences, I think they know that cutting international aid during a pandemic does not represent the values of Scotland and our people. That is why the Scottish Government are doing what they can with the powers they have at Holyrood. We have increased international aid spending by 50%—that is what should be done in a pandemic, Minister. The Scottish Conservatives have a choice: either fall in behind their Prime Minister, no matter what he decides, or join us in saying that these cuts to the world’s poorest are not done in our name. If they fail to oppose these cuts, the Scottish Tories should be well warned: it would be not only an inhumane act against the most vulnerable, but an act of sheer hypocrisy.
Today’s debate on aid spending is all the more significant because of the place and the context in which we find ourselves. Morally, we have a responsibility to help protect the most vulnerable around the world. It is also self-evident that if the UK Government were serious about the eradication of covid-19, that must include a commitment to help eradicate covid-19 around the world, because until all of us are safe, none of us is truly safe. These aid cuts are severely undermining that commitment and limit our power in meeting the covid challenge.
There is a broader point, too. As we attempt to emerge from this pandemic, the values we live by and the choices we now make become even more important. Covid has affected every country and every person around the world. We have all faced the same threat; we have all been in it together. If we did not know that before, we should know it now. But the truth is that just because we have experienced the pandemic together does not mean that our challenges are in any way equal. We are privileged. We can live in the hope and expectation that the crisis of the pandemic will pass, but for too many millions in this world, the pandemic is only one more disaster to deal with, in countries that suffer under constant crisis and struggle. Now is not the time to turn our face away from those countries and those people in need. Now is the time to redouble our efforts and our commitment to them.
The World Bank predicts that the pandemic will push an estimated 88 million to 115 million people into extreme poverty, and in the world’s poorest countries, hunger and the causes of malaria are rising. Unless we act now, one crisis will be followed by another, and the cycle will go on—and on, and on. We simply cannot break the poverty cycle by breaking our commitment to overseas aid. This is a choice for the Government; it is the choice for every Member of this House. On these Benches, our choice is clear. It is time to live up to our commitments on aid spending. It is time to live up to our responsibilities to the world’s poorest. It is time to break the cycle.
Mr Speaker
If we can try and help each other now with brevity, that would be very helpful.
Mrs Theresa May (Maidenhead) (Con)
Thank you, Mr Speaker, for granting permission for this debate.
I oppose the cut from 0.7% in international development funding for three reasons. First, I stood at the election on a manifesto that said:
“We will proudly maintain our commitment to spend 0.7 per cent of GNI on development”.
Now, the Government will say, as the Chief Secretary has today, that covid has changed the circumstances, but the Government are also taking pride in and responsibility for the fact that our economy will bounce back this year, and covid has also changed the circumstances for the poorest people around the world. For many of them there will be no bounce back, because for some of them it will simply be too late. So I urge the Government to stand by their word and stand by our manifesto commitment on international development funding.
My second reason is the impact, which I have just alluded to, that the cut will have on the poorest people around the world. My right hon. Friend the Member for Sutton Coldfield (Mr Mitchell), in his thought-provoking and forceful speech, gave us some examples of the impact the cut will have—the damage it will cause to lives; the lives that will be lost. I want to mention just one particular area of interest to me: modern slavery. As one example, the global fund to end modern slavery is having its funding cut by 80%. That means that programmes will be lost, including programmes to work to end the commercial sexual exploitation of children, with all the damaging and devastating impact on young lives that the loss of that programme will have. The global fund will try to restore that money from elsewhere, including from other Governments. The United Kingdom has been the world leader in tackling modern slavery. Now we see organisations having to go cap in hand to other Governments to make up for the shortfall caused by the UK’s decision to cut international development spending.
Aid spending is not just about people in countries far away. Tackling modern slavery has an impact here on the streets of the United Kingdom. Supporting economic development elsewhere will help to cut the number of people who feel they have to migrate to the UK in order to look for work, and cutting ODA spending has an impact on other Departments. I recall in the Home Office that we used ODA spending to fund some of the work we did with refugees. If we cut that funding, either the work will not be done or the Home Office will have to find that money from other parts of its budget.
The third reason I oppose the cut is the impact on the UK’s standing in the world. People have respected us for our commitment to 0.7%; now, as we have heard, we are the only country in the G7 that is cutting aid at this time. People do not listen to the UK because we are the UK; they listen to us because of what we do and how we put our values into practice. Our commitment to that 0.7% has, for example, enabled us to argue the case for different definitions of ODA spending. Cutting this spending will have an impact on our standing.
Will we suddenly see countries cutting us off? No. Will we suddenly be kicked off international tables? No. But the damage it does to our reputation means that it will be far harder for us as a country to argue for the change that we want internationally—and that is across the board, including at COP26 and in respect of our setting out and putting into place the ambitions of the Integrated Review, which does not even mention modern slavery as one of the Government’s development priorities. I only hope that modern slavery is still on the G7 agenda, as it has been in the past.
The cut from 0.7% will have a devastating impact on the poorest in the world and it will damage the UK. I urge the Government to reinstate the 0.7% target: it is what they promised, it will show that we act according to our values and it will save lives.
Sarah Champion (Rotherham) (Lab)
Thank you, Mr Speaker, for your assistance in securing this debate. The number of people not only who have campaigned on this issue for the past year but who want to speak today shows the true strength of feeling on this issue and the cross-party support for it.
I wish to talk about hypocrisy, which it is something I just cannot stand. Unfortunately, the Government’s approach to ODA foreign aid spend is dripping in hypocrisy. The Government have stated their seven global priorities, and we know the priorities for the upcoming G7, but unfortunately what the Government actually do does not match up in any way. I wish to use this speech to highlight specific examples of where the Government are failing.
On global health security, we are cutting by 95% our funding for the global polio eradication initiative, at the exact moment when we are about to eradicate polio. Funding for UNAIDS is cut by 83%, impacting the provision of life-saving HIV treatment to the most marginalised. A programme by the Liverpool School of Tropical Medicine to build stronger, more resilient health systems in low and middle-income countries is cancelled. The King’s Global Health Partnerships programme “Saving Lives”, which was due to improve care for thousands of pregnant women, is cancelled.
Funding for neglected tropical diseases is wiped out. Funding for life-saving water, sanitation and hygiene projects is slashed by 80% in the face of covid-19 and climate change. The Concern Worldwide project to provide healthcare to people living in remote and disadvantaged areas of Bangladesh is terminated. The project was due to reach 2.6 million people, including 140,000 people living with a disability.
The G7 Foreign Ministers have committed to end violence against women and girls, while girls’ education is a key priority for the Government, yet the women’s integrated sexual health programme is cut by £72 million. The International Planned Parenthood Federation described the “brutal cuts” as
“a tragic blow for the world’s poorest and most marginalised women and girls.”
The UK Bangladesh Education Trust project to educate girls forced into domestic labour has been cut entirely. In Tanzania, the projects of Children in Crossfire and EdUKaid to support children, including disabled children, to access education have been cut entirely.
The United Nations Population Fund is cut by 85%, potentially leading to 25,000 unintended pregnancies. STiR Education projects supported marginalised families across Uganda to access education but have been cut entirely. The projects of S.A.L.V.E.—Support and Love Via Education International—to support girls living on the streets to return to school are cut entirely.
The Women for Women International female empowerment projects in Nigeria and Afghanistan are terminated, leaving thousands of marginalised women abandoned. UNICEF’s core funding is cut by 60%, impacting its ability to provide children with access to water, sanitation, education and health services. An International Rescue Committee project in Lebanon to prevent and respond to gender-based violence, and for child protection, has been cut, depriving 107,000 people of those services. In Sierra Leone, the budget for an IRC programme was cut by 60%. It reached more than 3 million people, mostly adolescent girls.
Humanitarian preparedness and response is also a priority, alongside the G7 commitment to supporting developing countries to tackle and prevent humanitarian threats, but aid to support Rohingya refugees in Bangladesh has been cut by 42%. Mines Advisory Group programmes have been cut by almost 50%, with all funding for work in Lebanon withdrawn. Humanity & Inclusion projects providing speech and physiotherapy sessions for disabled Syrian refugees have been cut entirely. The Tomorrow’s Cities project, working to reduce the risk to poor countries of disasters such as earthquakes, volcanic eruptions and landslides, has been cut by 70%, compromising the ability of vulnerable communities to respond to disasters. Aid to Yemen has been slashed by nearly 60% in the face of catastrophic famine.
I could go on and on; that is only the beginning of the cuts that this Government are bringing about. That wrecks not only our international standing but the security of this country, because we are cutting money not just for humanitarian projects, but for projects that prevent conflict and poverty. What are some of the main drivers of conflict around the world? Unstable Governments, famine and lack of opportunity.
We were the world’s leading country on a number of those projects, which kept us safe and allowed the world to prosper. By cutting them, and by stubbornly refusing to give us the data on when fiscal circumstances will allow us to go back to 0.7%, the Government are undermining this country and the investment made thus far by the taxpayer.
Mr David Davis (Haltemprice and Howden) (Con)
I will be brief. The arguments for the moral case that we are arguing today should be clear to anybody who has listened to the discussions of the last few days, weeks and months. The Government’s arguments on financial grounds are clearly wrong. This is a rounding error in the national accounts. The Treasury cannot forecast the economy to within £4 billion each year, so how can it account on that basis for this judgment?
I heard that the reason is political; that it is a judgment that the working class of the northern red wall seats do not like foreign aid. Well, I have defended a blue brick in that red wall for 33 years, and I can tell the House that that is wrong. The simple truth is that if we said to someone in one of those seats, “Do you want to spend money on the Ethiopian Spice Girls?” they would say that no, they would rather spend it on a local school or on cutting poverty in Barnsley or whatever it may be.
However, if we asked them the proper question—the real question—they would give us the real, British, generous answer. If we said, “Do you want to act to prevent children dying from dirty water?”, 76% would say yes. If we said the same about starvation, about the same number would say yes. If we said, “Do you want to act to prevent an emergency in a crisis?”, 92% would say yes, as my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) mentioned. Some 92% of all British citizens would want their money spent on that. What would they think of the 60% cut in the contribution to Yemen, the most difficult emergency in the world today? Or South Sudan? Or the Democratic Republic of Congo? Or Syria? These decisions have consequences, and they are just as smart as we are; they will see those consequences, too.
In the Sahel, 270,000 people a year get life-saving medical support, and that is going to be cancelled this year. That is interesting, because we are also sending 200 British soldiers to the Sahel to help suppress terrorism, and what will this do for that? This will be a recruiting sergeant for terrorism in the Sahel. This is actually acting against our interests and against our soldiers’ interests, and we should remember that when we are doing our accounting sums. Bear in mind that this will not just be poverty; it will be poverty that will be blamed on the west by the people acting against us in the Sahel.
The Minister claimed that the actions he has outlined are in our national interest. While in the long run doing the morally right thing is what is always in our national interest, this is not the right thing. It is the morally wrong decision for the world, and it is the practically wrong decision for our country.
Hilary Benn (Leeds Central) (Lab)
Well, this issue is not going to go away, is it? Why? Because it is about the promise, as we heard in the brilliant speech made by the right hon. Member for Sutton Coldfield (Mr Mitchell). It is about the promise we made to people who in all likelihood know nothing of its existence, but whose lives have been changed by our generosity. They are people who have drunk clean water or gone to school and mothers who have seen their babies safely delivered or vaccinated, thanks to the immense generosity of the British people. The question is therefore a very simple one: how can it be right or moral to break this particular promise that we gave in good faith to others? The answer is very simple, too: it is not. It is wrong, and, as we have heard, it is damaging our international reputation.
The Prime Minister will sit down opposite the G7 leaders at the end of this week. They are facing exactly the same fiscal pressures as he is, but have the United States, Germany, France, Canada or the other G7 countries cut their aid budgets? No, they have not, because they understand the moral argument.
Jacob Young (Redcar) (Con)
The right hon. Gentleman listed a few countries. Of course, none of those countries actually commits 0.7% of their GDP anyway.
Hilary Benn
With respect to the hon. Gentleman, that is not the point. We made a promise. I presume he is as committed to keeping promises he makes as the rest of us here in this Chamber.
What of the human cost? We heard from the right hon. Member for Maidenhead (Mrs May) in her powerful speech about lives blighted, lives shortened and lives lost. Let me just take one example. How can it be right to cut aid for clean water by 80%? The arguments against doing that are so strong, such as the importance of clean water for hand-washing in a pandemic. There is the fact that the single most important thing we can do if we want to reduce infant mortality, apart from improving immediate postnatal care, is provide clean water, because every day babies and small children die because they drink dirty water. Clean water helps girls to go to school, the very thing that the Government say is a priority.
As International Development Secretary—the right hon. Member for Sutton Coldfield talked about his experience—I learned that there are moments when those of who have the privilege to do the job have our minds changed. We learn and we understand, and we realise why something is so important. In this example, I came across a well one day with a lot of people standing around it. I was told that the well was closed. I had never come across a closed well before, but it was explained that because demand for water in that part of the city was so high, after the first rush of buckets was drawn from it in the morning, the well had to be closed so that the water table had time to replenish to allow the well to be reopened.
One of the people waiting was a girl of about 13 or 14. The well was here and she was standing there—I can remember it to this day. She told me in a very quiet voice that it was her responsibility in her family to get the water every day, because until she did so, she could not go to school. Because the well was closed not just that day, but many days, she was often late for class. That is what this is about: a lack of plentiful, clean water, which all of us here take for granted, meant a lack of education for her and millions of other girls like her.
Are we really going to say that it is acceptable to cut our support for clean water? Is anyone actually going to argue that these cuts are popular with the British people? I fundamentally disagree; the British people are much more compassionate than that. It is not a competition between charity at home and aid abroad. We can, we should, we must do both.
Mr Deputy Speaker (Mr Nigel Evans)
With immediate effect, there is a time limit of four minutes.
Sir Roger Gale (North Thanet) (Con) [V]
I want to touch on the two core aspects of this: the political and the humanitarian. Dealing first with the political, we are promoting global Britain, we are told. Once again, we are proudly taking our place on the world stage, we are told, and that is right and good. However, if we are going to do that, we have to be able to hold our heads high, and I cannot see how damaging some of the poorest people in the world will enable us to do that.
Politically as significant is the fact that where we leave a vacuum, others will fill that vacuum. Those others will be China, the Russian Federation and Russia’s client states, Azerbaijan and Belarus. I wonder how many colleagues are prepared to see the emerging democracies turn to communist dictators for assistance, because we have pulled the rug out from under them.
Secondly, the humanitarian effect has been touched on over and over again. In 38 years—tomorrow—in this House of Commons, I have been privileged to travel fairly widely to some of the poorest regions of the world. I assume that the former Foreign Secretary, now the Prime Minister, during his time in his previous office, was able to do that. I am quite sure that the Chancellor of the Exchequer is a widely travelled man. I suppose that they, like me, will have seen, smelt and tasted the death that comes from poverty and starvation, and seen the misery of young girls having to walk miles every day to fetch foul water. Now, to see the opportunities taken away from those young people around the world is, I believe, unforgivable.
Yes, of course we have run up a huge debt in the course of the covid crisis, but put that in perspective. We are talking about a cut upon a cut. As my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) said in his opening remarks, this was designed to scale against a reduction in gross national income. By reducing the figure from 0.7% to 0.5%, we are exacerbating that cut. In so doing, we are hitting what used to be known as the bottom billion, the 1 billion people in this world who live on less than $1 a day, a figure that the United Nations believes to be the sign of abject poverty.
I want our Prime Minister to be able to go to the G7 with his head held high. I extol the virtues of our contribution to COVAX, but this cut that has been put forward by the Treasury is unforgivable and it must be reversed next year.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
I congratulate the right hon. Member for Sutton Coldfield (Mr Mitchell) and I thank the House authorities and Mr Speaker for the debate today. I have risen to speak because this decision seems, at one and the same time, to be a decision that dishonours our word, dismays our friends and delights our enemies.
I want to make just three points. The first is simple: this decision defaces and demeans the strategy that was set out in this House by the Prime Minister as long as 69 days ago, when he came to that Dispatch Box to present the Integrated Review to the House. He said that he was determined to build resilience at home and abroad and to tackle risk at source:
“We will be…dynamic abroad”.—[Official Report, 16 March 2021; Vol. 691, c. 161.]
He declared that 2021 will set the tone for the UK’s international engagement abroad—let us hope not, because on the eve of the G7 this Prime Minister is leading by retreating. The only dynamism he is showing is in the speed with which he is breaking his promises to the world.
The former Prime Minister, the right hon. Member for Maidenhead (Mrs May), did not make many speeches about foreign policy, but there was a phrase she used often that was good—the notion of the rules-based order. We should have a Government who extol the benefits and the virtues of a rules-based order. However, we now have a Prime Minister who is ordering the breaking of the rules, not just with the nonsense around the international protocols in Northern Ireland, but with our international promises to the world community. One has to ask, why would anybody trust him? The truth is that he will soon discover that unless he is more hard-line about keeping his promises, our influence in the world will diminish. Once upon a time, it was known abroad that our word was our bond. That is not something to surrender lightly.
My second point is that the Prime Minister risks a serious imbalance in our foreign policy. In today’s world, defence of the realm entails a mixture of deterrence and development. President Biden has a useful guide. He says, “You talk about values. Show me your budget and I will tell you what your values are.” We now have a situation where defence spending is rising by £24 billion and development spending is falling by £4 billion—a £28 billion gap.
Jacob Young
When the right hon. Gentleman was Chief Secretary to the Treasury, did the UK ever meet its 0.7% target?
Liam Byrne
We were proud to set the ambition, and we set a critical path to doing it, because we knew precisely this—that development and deterrence are two sides of the same coin. They are essential to the defence of the realm.
The Prime Minister, when he presented the Integrated Review, boasted that we were about to send the new Queen Elizabeth carrier group on a worldwide tour. In how many of the 100 countries where we are cutting aid will that carrier group come into port? I bet that everywhere it does, we will find that our projection of power is as nothing compared with the power of a project to make poverty history.
Two thirds of the world’s poorest live in fragile, conflict- affected and violent states. It beggars belief that under the Government’s proposals, nations such as Libya and Iraq will no longer receive bilateral aid. There should be a simple rule of policy that we will not drop aid in places where we drop bombs, or where others drop bombs that they bought from us. Investing in places where we can alleviate poverty is one of the biggest investments we can make in safeguarding our security for the years to come.
My final point is simply this. The Chair of the International Development Committee, my hon. Friend the Member for Rotherham (Sarah Champion), helpfully set out the extraordinary range of cuts that are now being confronted. As chair of the Parliamentary Network on the World Bank and the International Monetary Fund, I asked the IMF this afternoon for an update on the sheer scale of investment that is needed to get the global community back on its feet. Low-income countries will now need $200 billion extra to step up their covid response, followed by $250 billion extra in accelerated investment as we try to move from the pandemic to the Paris agreement. We are now going to—
Mr Deputy Speaker (Mr Nigel Evans)
Order. Sorry, we have to leave it there.
Karen Bradley (Staffordshire Moorlands) (Con)
I refer the House to my entry in the Register of Members’ Financial Interests. I congratulate my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) on securing this urgent debate.
The United Kingdom is a nation of islands. Apart from one well-known land border, we are surrounded by sea. If we are surrounded by sea, we have a choice. We can turn our back to the sea and look inwards; we can look only at the people in our own country, our own town or perhaps even our own village. I think that makes us smaller and poorer. Alternatively, we can turn round and face the sea. We can face the world. We can be part of a global nation. I think that makes us wealthier, it gives us a better quality of life, and it makes us better as a country.
Being an outward-looking global Britain means many things. It means taking our seat and playing a full role in global institutions. It means meeting our commitments on defence, which the Government are proud to have done. It means trading and promoting free and fair trade around the world, and it means doing our bit for the world’s poorest.
I wish to make three points. First, I accept that this is an exceptional time. There is nothing that I like about this pandemic. I do not like how empty the House is. I do not like not seeing my loved ones. I do not like anything about it, and I accept that it is an exceptional time, but there are organisations that need certainty about their funding from the United Kingdom. My right hon. Friend the Member for Maidenhead (Mrs May) talked about the Global Fund to End Modern Slavery. I, too, have spoken to the Global Fund, which has seen an 80% cut in its spending. It will get by, by going to other countries, but if it does not know that we in the United Kingdom will meet our commitments, it will have to close programmes, and that will leave thousands and thousands of children at risk of exploitation.
That brings me to my second point, which is about keeping our promises. I proudly stood on a manifesto that talked about “proudly” keeping to 0.7%. There are some who think that this is a ruse to introduce 0.5% by the back door. I really hope that that is not the case. The Minister and my right hon. Friend the Prime Minister have said that we will revert to 0.7% when the economic situation allows. When will that be? When can we have a vote on this matter? When can we know that we will meet our commitments? The organisations, the programmes and the people who depend on that money need to know that it is coming.
My final point is about how joined-up the world is. If the pandemic has shown us one thing, it is that we cannot isolate ourselves from what happens in the rest of the world. No matter how much we might want to turn our backs on the sea and look inwards, we cannot. Variants that developed in far-flung parts of the world, and a virus that developed in a far-flung part of the world in a city that most people probably had not heard of a year ago, have meant that our way of life has changed fundamentally this year. We cannot isolate ourselves from the rest of the world; we have to take an active role.
A small amount of money, relatively speaking today, helps to stop refugees travelling in boats on the channel. It helps to stop victims of slavery producing the goods that we are buying in our supermarkets and retailers, and it means that girls will get that 12 years of education. In the week of the G7 and in the year of COP26, this is the time for the United Kingdom to stand with our head held high, show that we meet our global commitments and lead the world.
Layla Moran (Oxford West and Abingdon) (LD) [V]
I congratulate the right hon. Member for Sutton Coldfield (Mr Mitchell) on securing this debate and on his speech. His recollection of starving children in Uganda brought a tear to my eye, and I was reminded of the extreme poverty I saw when I lived in Ethiopia in the late 1980s. He is right: those memories never leave you. It is those children I met—many of them my own age—who are at the front of my mind now, too.
In his remarks, the Minister drew moral equivalence between maintaining our promises to starving children and leaving future generations with extra debt—how shameful. There is no equivalence there, because one is a death sentence and the other is not, especially when our young people, just like the rest of our country, overwhelmingly support 0.7% being spent on aid spending.
To abandon this commitment comes at a real cost, and it is not just a humanitarian cost. It is true that more lives will be lost this year, next year and the year after that, until the day when the Government finally decide to return to 0.7%, and that is notwithstanding the mess that has been caused by cutting off those funding streams so quickly.
There is also a cost to the UK’s global reputation. How on earth are we to convince developing nations at COP26 to trust our leadership at the most pivotal climate change summit in a generation when in the same breath we have undermined our credibility with them? This is a Government who say one thing and do another, who cannot be trusted, and who behave in a way that is so fundamentally un-British that it makes me feel ashamed.
When the Prime Minister stands up at the G7 this weekend, what will our allies and friends think? The Prime Minister will encourage our allies to pledge more to fund girls’ education while he cuts spending by nearly £200 million. He will offer a hand of friendship to Italy, Germany and France while his Brexit negotiator continues to make incendiary comments about the Northern Ireland protocol. He will speak of the importance of promoting democracy around the world and adhering to the rule of law when this Government deny elected representatives the chance of any vote on aid spending, even when lawyers suggest that we are breaking our own law.
If the Prime Minister wants to make a statement about his Government’s global ambitions, the single most meaningful and impactful thing that he could do right now is give us a vote on whether we should reverse these cuts. If a vote is granted, the Liberal Democrats, who introduced the legislation that enshrined the 0.7% in law, will join others from all sides of the House and will vote to keep our promises and hold on to our word.
I said that this Government and their actions make me ashamed. By contrast, this debate and the clear will of colleagues on all sides of the House to do the right thing should make all Britons proud. I look forward to continuing to work with them for as long as it takes until this Government listen.
Sir Edward Leigh (Gainsborough) (Con)
There have been some very moving speeches today. I could spend the time allotted to me repeating the humanitarian points, which by the way I believe in, that we have a duty to the world’s poorest, but my criticism of the Government’s action is based not so much on that as on the question whether this is the right way of proceeding if we are seriously concerned about running the public accounts in an efficient way.
Leaving to one side the fact that there is a manifesto commitment, which is important, I accept that the situation has changed with the pandemic and our economy has declined. Of course, the Government could have cut £2 billion from the overseas aid budget without any adverse criticism, because it was linked to the 0.7%. As our economy declined, we could very easily have cut the aid budget by £2 billion with no argument, but the Government decided to cut it further. What they should have done at that stage was be completely honest with the House and the people and say, if that was their view, “We don’t actually believe in this commitment to 0.7%”—but no, they said, “We still believe in it—this cut is entirely temporary.” But what does “temporary” mean: six months, a year, two years?
It is worse than that. The Government are, in a sense, hoist by their own petard. They have said that this is only temporary, so they have ordered the civil servants in the Department to go on cutting all these programmes. The one way to build in a lot of waste is cutting too quickly, which is almost as wasteful as increasing spending too quickly—I was often critical of the Labour Government when they increased spending too quickly. A lot of waste has now been caused by these civil servants going around cutting all these budgets.
I will leave aside the terrible humanitarian effects, because the point has already been made very effectively by colleagues, but if we accept the Government’s own logic, in six months’ or a year’s time, the same civil servants will be running around restoring all these programmes. There will be a huge amount of waste, and in the meantime, incidentally, a lot of people will have died, a lot of wells will have run dry and a lot of girls’ education will have been ended. People will have died and there will be a huge amount of waste.
Let me offer this compromise to the Government: just be honest, be transparent, be open with Parliament and accept parliamentary democracy. They could set a date—if they wanted, it could be by the Budget or some time early next year—when they will come honestly to Parliament with a policy. I am prepared to be open-minded about this 0.7% and to accept that although it is a manifesto commitment, there may be occasions where it might cause feast to famine to feast, but let the Government make their argument honestly. After all, this is the law; we are supposed to spend 0.7% of our budget by law. If we no longer believe that, we have to come to Parliament to repeal that Act or come to Parliament in the Budget debate and present an alternative. I am not even asking the Government to commit now in the Budget next year to restoring the 0.7%. I am just reaching out to them, with a compromise, to ask them to announce shortly, to end this debate, now and forever, that there will be a transparent, open debate within the next 12 months, so that we can determine this issue forever. Put Parliament first.
Mr Virendra Sharma (Ealing, Southall) (Lab) [V]
I hope to be brief.
Looking around the world, we see so many problems that need our help—[Inaudible.] It has been a discourtesy to this House and to millions of people up and down the country who voted in 2019 for 0.7%, that this Government tried to cut that without any discussion or debate. I was heartened by the Prime Minister dispatching ventilators and oxygen converters to India, but Nepal is still waiting. India leads the world in vaccine research and production, whereas Nepal has no facilities to produce vaccines. Millions of vulnerable people in Nepal need vaccines, especially second doses. Those are not coming, but we have 500 million doses for 70 million people.
I have visited amazing programmes and met people whose lives were changed and saved by British aid. No one who has seen that work would condone a cut. The cut is barbaric at this time . When I meet people abroad, and online now, I am nothing but proud of our record as a donor to good works, But that work on gender equality, clean water and sanitation, 12 good years of education, ending human trafficking and modern slavery—[Inaudible]. We cannot let this Government waste that work without a fight. We must end this debate and support the return of 0.7% as our commitment to the nation and to the world.
Mr Deputy Speaker (Mr Nigel Evans)
Thank you very much. Sorry about those communications problems, but we got the vast majority of it, Mr Sharma.
Mr Tobias Ellwood (Bournemouth East) (Con)
I very much welcome this debate today and I congratulate my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell). It will help widen our understanding of how British overseas aid commitments work and also our soft power, which allows us to speak with such authority on the international stage and goes in part to justify our seat on the UN Security Council. It is also plays a pivotal role in supporting our economy and strengthening our national and international security, which is what I wish to focus on today. I will just say that for too long our aid programmes worked in isolation of wider Government strategies, often without a British flag to even acknowledge their origins. We have come some way, but I would be the first to say that taxpayers’ money must be wisely spent. As a former soldier, I was saddened and horrified to see the failure to utilise our aid programmes in both Afghanistan and Iraq; we won the war but we lost the peace. Hard power and soft power are two sides of the same coin, and we will need a lot more of both over the next decade—this is something the G7 summit will doubtless attempt to address. Our world is on a worrying trajectory, with rising authoritarianism, growing extremism and the new challenges of climate change and defeating a brutal pandemic that continues to damage economies and take lives, but the west has become risk averse, with an absence of leadership and resolve to address these issues alongside weakened international institutions that are no longer able to defend our rules-based order.
This G7 summit offers an opportunity for Britain to step forward as we have done in the past when other nations hesitated, but when we step back, we not only cause hardship, as we have heard today; we also leave a worrying vacuum that gets filled either by extremists in such places as Yemen and Somalia or more specifically by Russia and China, who pursue very different bilateral relationships that will most likely ensnare yet more nations into economic programmes they can ill afford. China has weaponised its soft power to extend its influence economically, militarily and technologically across Asia and now Africa. Nations are increasingly obliged to look west or east for assistance, and we are progressively seeing our word splinter into two competing geopolitical spheres of influence. That is the face of the new cold war that looms ahead, and this is not the time to reduce our soft power footprint.
We understand the huge bill of £400 billion that the Treasury faces, but if this is all about the money, why not learn from what we did after the war and ring-fence this debt, rather than using austerity measures to balance the books before the next general election? Our last war debt was finally paid off in Gordon Brown’s era as Prime Minister. We should do this in the same way. We should find a fiscal instrument that allows us to manage the books more sensibly here today. As our history shows, we are that Churchillian nation that steps forward when others hesitate. I say this to the House from a security perspective: the next decade is going to get extremely bumpy indeed. The US is once again keen to play its part on the global stage, so in the spirit of global Britain, let us be that reliable ally, let us stay firm and let us honour our manifesto commitment.
Chris Law (Dundee West) (SNP) [V]
If there was ever a time for humanity to come together, it is now. Millions have lost their lives to covid-19, and millions more will continue to suffer the effects of this global pandemic, so why are this Government choosing to impose devastating cuts to worsen and prolong the suffering of the poorest and most vulnerable communities in the world? Surely the way to honour those who have lost their lives and livelihoods to covid is to ensure that we build forward better across the world. This is the only thing, and the right thing, to do.
The Prime Minister talks about global Britain, but that means nothing when this Government are determined to scale back life-saving assistance to those most in need. He stated that a new royal yacht Britannia would be
“a clear and powerful symbol of our commitment to be an active player on the world stage”.
However, living up to international aid commitments is far more effective in that regard than a flag-waving nostalgia-driven vanity project. If it is financially prudent to spend on a new national flagship and to stockpile even more nuclear weapons, there is simply no excuse not to reverse this devastating cut if we are be an active player on the world stage at the G7 summit this week. Indeed, how can this Government have any credibility whatsoever in calling for others at the G7 to commit to further spending to ensure global recovery when they and they alone are cutting back? The UN has specifically urged Governments to meet the 0.7% commitment, warning that 120 million people have been plunged back into extreme poverty and that the sustainable development goals could be pushed back 10 years due to the pandemic, yet despite all that, this Government have done the exact opposite.
It does not need to be like this. Other G7 countries are increasing their aid and we in the SNP have called for development spending to be ring-fenced at pre-covid levels. The Scottish Government, like others in the international community, will add to vital aid contributions by increasing our international development fund by 50%. The day Scotland becomes an independent player on the world stage cannot come quickly enough. Let us be clear that these cuts will cost lives. Estimates suggest that a million excess child deaths could occur as a result. These could be any of our children. Are we to turn a blind eye because they are someone else’s children? Aid to Yemen, the world’s worst humanitarian disaster, has been cut by 60%. Aid to Africa, where 85% of the poorest 1 billion people will live by 2045, will fall by more than two thirds. In the middle of a pandemic, this Government decided that funding that could have provided 10 million people with access to water and sanitation, the most basic defence against covid, should be withdrawn.
Finally, no one has escaped this pandemic, but the poorest have been expected to pay the ultimate price. No one is pretending either that the challenge of recovering from covid is easy, but as the rest of the world is stepping up, the UK should not be stepping away. Indeed, this is not just about political debate or defeating the Government; it is about saving lives. It is about those who rely on the international community to give them support, who have had their livelihoods destroyed, who will die in the hundreds of thousands, and who have little or no voice. The Government can choose to listen to this House and reverse these cuts, or they can abandon the world’s poorest and become an ever smaller and insignificant little Britain of which we want no part.
Mrs Maria Miller (Basingstoke) (Con)
May I draw the House’s attention to my entry in the Register of Members’ Financial Interests?
We have heard some very powerful speeches today. Of course, I pay enormous tribute to my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell). I respect his impassioned arguments and long-standing commitment to international aid, but, respectfully, I have to offer an alternative view today.
The UK’s commitment to international development is globally recognised. We are proud of our commitment to supporting developing nations, and we have heard that today. From my many years here, I can say that it has not always been this overwhelming a debate in the past. We have to be honest. The unprecedented circumstances of the past 12 months have forced this Government, as it would have done any Government of any complexion, to take some very difficult decisions. Circumstances are exceptional, because so much of our money—probably a globally unprecedented package—was put together to shore up our health service and to shore up our businesses in the face of a global pandemic. I think the Government are right—
Mrs Miller
Will my right hon. Friend just give me a moment to make my argument?
The Government are right not to put their head in the sand. It is not possible to continue with business as usual. These are not normal times. We have a responsibility as a Parliament to act, and to simply dismiss £4 billion-worth of expenditure as a rounding error is, I think, the first time I have heard such a thing in a debate such as this.
Mr Mitchell
I am very grateful to my right hon. Friend for giving way. Obviously, she and I do not fully agree on this. Would she like to speculate on why Britain alone of the wealthy nations is cutting its aid when everyone else is either maintaining it or increasing it? Why is our economy so bad that we have to balance the books on the backs of the poorest people in the world, unlike all the other rich countries?
Mrs Miller
I think my right hon. Friend is right, and I would speculate—although I would need to look at the figures in more detail—that perhaps our country has put more money into supporting our health service and more money into supporting jobs. Perhaps we will be in a better position to resume our international aid spending when we are on the other side of this pandemic. He is right that we need to look at that in more detail.
We cannot always forecast the future, and that is why the legislation has provisions in it to be able to make the sort of changes that the Government are proposing today. I say to my right hon. Friend that he makes a very strong argument about the importance of international aid, and he knows that I agree with him on that. I do not think that he should be over-simplifying his argument in the way that he started to in his opening statement today. The action that the Government are taking is not simply regular politics. The fiscal crisis the country faces is a result of the pandemic and that speaks to every constituency throughout the country. Nobody would choose to be in the situation that we face today, but to paint this as the UK walking away from its global responsibilities is wrong and it sends a very wrong message from this place to the rest of the world.
Mrs Miller
I will not give way again, else I will get into trouble with Mr Deputy Speaker.
We remain one of the main funders of international aid around the globe and we need to be proud of that. There has been much talk of reputation in this debate, and I believe that a reputation for fiscal competency is also a key part of our reputation around the world. If we are to remain one of the biggest contributors to international aid, we also need to retain our reputation for fiscal competency. Perhaps some of the fragility of the funding regimes, which a number of right hon. and hon. Members have talked about today, highlights the fragility of what is going on in the international aid sector and indicates the importance of increasing the number of countries investing to the level that we consistently have over a number of years and also of working together more to avoid that fragility in times of crisis.
My right hon. Friend the Member for Staffordshire Moorlands (Karen Bradley) is absolutely right: we cannot isolate ourselves, and the pandemic has demonstrated that amply. I therefore hope that my right hon. Friend the Minister will be back here soon to confirm when the UK can return to its normal terms of business on international aid. I also hope that he, or perhaps his colleagues, can talk more about what the Government will be doing to fulfil the promises in their equality strategy, so well set out in 2018, because that will all give certainty for the future. But for now, I believe the approach that he is taking is prudent not just for us, but for future generations as well.
Neil Coyle (Bermondsey and Old Southwark) (Lab)
I refer the House my declaration of interests.
The UK is at a crossroads. Our citizens and the international community wait to see which way the Government will take. However, it is not that Ministers cannot pick a route; it is that they have chosen, in the words of the brilliant speech by the right hon. Member for Sutton Coldfield (Mr Mitchell), to go backwards—and, I would add, have too frequently chosen to go back on their own word. This Government were elected on a manifesto commitment to retain aid spending. Ministers now seek to break that promise, despite their massive majority and despite the global pandemic, just when we are needed more than ever and when global Britain could mean something to the countries and people we are in a position to help.
As we have heard, no other G7 country is taking this approach—Germany and the US are increasing their help—and the outcome is also known. Ministers back- tracking and breaking their promise will mean avoidable loss of life and the preventable spread of disease, and in one case—the failure to provide clean water in a Yemeni refugee camp—could even mean more refugees trying to reach the UK.
The broken promise also contradicts the great British tradition of not ignoring problems and not walking on by. We are the good Samaritan—we pitch in; we help. We do so because it is the right thing to do, but it is not just altruism. We also do it because covid has proved more than ever that no one is safe until everyone is safe. Our aid prevents other diseases, such as HIV, spreading to our shores, can help to prevent conflict involving UK armed forces and the creation of refugees seeking further help from the UK, and can help to facilitate trade benefiting British business. Ministers seem ready to stand by and abandon all that.
“Global Britain” means nothing to most people, but it will mean even less without the agencies needed to deliver it—all those international aid organisations, which currently have so little faith in Ministers after the deceitful claim that they were consulted on the abolition of the Department for International Development and the devastating £4 billion cut in the help they deliver on the front line.
We all recognise that covid affects things, but the Government need to be more ambitious for our international reach and for our country. Let us compare how this country has recovered from previous crises. The post-war Labour Government achieved house building on a scale never seen before, created a social security system that the whole country has benefited from ever since and delivered an NHS still proving its worth in the face of covid today—a post-crisis Labour legacy that the whole country remains proud of. By contrast, this Government seem to seek no positive post-covid legacy. Ministers are abandoning even their own manifesto promises to the British people, despite the massive majority—promises on aid and cuts to the armed forces, as well as the pledges to overhaul social care and even on free TV licences for some pensioners. It is a truly pathetic agenda.
That said, I respect the noble aims of the right hon. Member for Sutton Coldfield and other Government Back Benchers, including the former Prime Minister, the right hon. Member for Maidenhead (Mrs May). I genuinely hope they are successful in overturning the Government’s betrayal of their own manifesto and their wider betrayal of the British people who voted for them.
Steve Brine (Winchester) (Con)
I have had hundreds of contacts from constituents concerned about the changes being made to our aid programme. Not all of them agree with me, but many do. My judgment is that the people I represent, like their MP, are really proud of the support that we give around the world.
But we should be honest: yesterday’s amendment, which led to today’s debate, was far from perfect. It would not have restored all the projects that we have heard about today. We are still spending £10 billion this year as the Minister rightly said, and we have seen the biggest drop in economic output for 300 years. Therefore, does the 0.7% to 0.5% cut matter? Have we rather pompously overblown our world-leading reputation in this area? My answer to those two questions is: yes, it does matter, and, no, I do not think we have.
I held the international health brief at the Department of Health and Social Care. I have attended G7 and G20 meetings—not at the level of the former Prime Minister, my right hon. Friend the Member for Maidenhead (Mrs May), and the former Secretaries of State that we have heard from, but I have been in the room. I hear the talk about it damaging our reputation around the world. Perhaps some think that that is overblown—perhaps they think it is part of our pompous overblowing of this issue—but it does matter. I have seen that in the room: what the UK does matters, and countries follow us. We are in a position to ask them to do so because of our deeds.
I have also seen much of the good work that we do. HIV is one of the many examples that I know about and am particularly worried about. An open letter published today by a wide range of organisations working in this field, plus Lord Fowler, who knows a thing or two, says that they fear that the reductions risk
“setting the stage for a resurgence”
of the AIDS pandemic. That sits at such odds with the domestic progress that we have made on HIV and the recommendations of the HIV Commission, which I was proud to be part of, on ending new HIV transmissions by 2030. What will happen around the world with the HIV reduction programmes is tragic.
Anthony Mangnall
My hon. Friend is making an important point about HIV/AIDS. The fact that it has been cut by 80% because of this decision is kicking the can further down the road and making it a bigger problem in the future. Does he agree that this jeopardises everything we have worked for?
Steve Brine
Yes, and frankly it does not really matter whether I do. Dozens of organisations working in this field have written an open letter in The Telegraph today setting out why and how this matters. I am really worried about it.
I think back to my early days in this House, and one of the first things that I did in Winchester, which I am so proud to represent, was to hold a session with the former Minister, Stephen O’Brien, who was a very good International Development Minister. It was called “Ask the Minister”, and it was in St Paul’s church in Winchester. Dozens of constituents came to that meeting to listen to the manifesto commitment that we made in 2010 and the way that we were going to legislate for it.
For me, this is not just a manifesto commitment made then and in 2019; it is a personal commitment that I want to stand by. I know that to meet it, we have to make choices, but it was a choice to make the pledge in the first place, and it is a political choice to keep it or not now. Abandoning 21 June, as we may do next week, is also a choice that will have a price tag attached to it. Perhaps there is a correlation there.
Finally, let me give an example from my Winchester constituency that saddens me. It is actually rather personal, given the global health budget that I used to hold. For many years, Hampshire Hospitals NHS Foundation Trust, which runs my local hospital in the University of Winchester, has obtained funding and used it to provide support for overseas projects such as stroke services in west Africa, and paediatric maternity surgery and anaesthetic care in several east African countries. It has been funded thorough the Tropical Health and Education Trust, which receives money through UK Partnerships for Health Systems. It has had its programme cut from 2020 through 2024 as a result of this reduction, so it is not just a one-year hit, as some say. It is devastated about the work it is now not going to be able to do.
If anybody on the Opposition or Government Benches, friend or foe of mine, or any of my colleagues speaking against this proposal today, thinks that we enjoy giving the Government a hard time, let me say, we do not. I am here to say what I think on behalf of the people I represent, and I think this is wrong. Even now, at this late stage, let us not do this. As I always say to constituents who disagree with me on this subject—and there will be many—charity does indeed begin at home; it just does not end there.
Catherine West (Hornsey and Wood Green) (Lab)
It is a pleasure to hear so many Members across the House joining together, looking at the progress that has been made on HIV/AIDS over the years and urging the Government to change their mind on this funding question. I know my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), who chairs the all-party group on HIV and AIDS, which is cross-party, has also done an enormous amount of work on this.
I want to talk today about the impact on British science, but before I do I want briefly to mention the many wonderful experiences that we as Members, in different parties, had in, for example, Kenya or Nigeria, where so many children die from malaria. We know that, with the Commonwealth Heads of Government meeting this month, we are meant to be showing a very strong sense of leadership and I feel this kind of decision undermines that.
I was very pleased to hear the right hon. Member for Gainsborough (Sir Edward Leigh) talk about the waste of the in-year cut. When we cut budgets in-year, we may as well not spend the money at all; we just throw it away. So some medication that is being provided through programmes will actually be disposed of because of an in-year cut. It is a really bad way to manage programmes.
On British science, I declare an interest because my other half is a scientist and is very involved in malaria research. I understand that Dr Gilbert, who in Oxford invented the vaccine, invented it because she has a background in trying to find a vaccine for malaria. It is a very different kind of parasite from coronavirus—of course, coronavirus is much simpler, so it is much easier to get a vaccine—but the reason she is a vaccinologist and understands vaccines is that she worked in global health, and the UK is known for its excellence in that area.
These ODA cuts will have a massive impact on our regional universities. Of course, what we are trying to address are the regional inequalities within the UK. We know, for example—and the hon. Member for Winchester (Steve Brine) mentioned the trust in Hampshire—that there are 500 health facilities across Africa and Asia that work closely with the Liverpool School of Tropical Medicine. They teach medical science and medical research to Africans and in Asia as well. In particular, the concept is so good—this was one of the special things about many of the DFID programmes: it was a hand up, not a handout. Everybody wants to see these programmes where British scientists work closely with African scientists. They are equal scientists, and they work together and collaborate. It is not just handing out in a kind of philanthropic way to make us feel good; it is working on the global problems that affect each and every one of us. We are so far ahead in our vaccine project because of that background in global health.
This debate is taking place in the context of The Times rich list, where there are 23 more billionaires this year. Our economy has the potential, but we have to make our economy work harder so that we can afford this, because it is inequality that is going to bring down our society, which is going to cause even more problems, and we must tackle that difficult problem. Christine Lagarde has been saying it for years, and the IMF is saying it. Tackle inequality, and the rest will look after itself. We have to find a way for the 23 billionaires to help to pay for the £4 billion that we need to maintain this UK excellence across the world.
Steve Double (St Austell and Newquay) (Con)
This is a very difficult debate for me. It is very difficult because I can genuinely see both sides of this debate. It is difficult because I find myself with a different view from many colleagues on these Benches whom I respect very highly, and it is difficult because I, in my six years in this place, have possibly been one of the most enthusiastic supporters of our overseas aid budget. But we have to make some tough choices at this time, and I am sure that this is going to be the first of many tough choices that this House and this Government are going to have to make in the months and years ahead.
This pandemic started as a health crisis, but the longer- term impact will be an economic and a fiscal challenge. I say that representing one of the most disadvantaged parts of the UK, and it is forecast that the economic impact will be felt deepest and longest there. The money to continue our level of aid spending has to be found from somewhere. I am concerned that one of the effects of the last year is that we seem to have lost a sense of proportion of financial discipline. Colleagues have spoken of £4 billion as a rounding error. I can remember when hundreds of millions of pounds were talked of as a big Government spending item and now we talk of £4 billion as a rounding error. What has happened?
Many have spoken about our breaking of a manifesto promise. I remind colleagues that our manifesto also promised that we would reduce the debt over this Parliament—that the debt at the end of this Parliament would be smaller than at the beginning. We are having to break that promise—we all understand why—but let us not pretend that cutting our aid budget at this time is the only manifesto promise we are going to have to break because of the very difficult situation in which we find ourselves. I find it very uncomfortable that we have to make this cut in our aid spending, but I also feel very uncomfortable adding to the debt that my grandchildren will probably have to pay back for this country. That is a tough choice that we have to make.
We will remain one of the largest contributors in the world. The way some hon. Members are talking here today, it is as though we are completely cutting our aid budget and will never spend another pound. We are still contributing £10 billion—the third highest amount in the G7. Several Members have made comments about providing leadership and losing our influence, but in all the years that we stuck to our 0.7% aid target, how many followed us? Not very many. So let us not overplay our global influence in that regard.
It has been common to trail through tweets this week. I have been quite surprised that some people on these Benches who have been the most enthusiastically in favour of 0.7% today were putting out tweets just a short while ago saying that it was the wrong decision for the Government to make. So I think we need to look at the wider picture.
I simply say two things to the Government. I do not find it easy, but I do understand, in the current context, why the decision has to be made to start making those tough decisions to restore financial discipline. That is something that we on these Benches, in this party, should stand for.
In concluding, I ask the Minister two things. Can we please ensure that the cut to overseas aid is done in a way that minimises the impact on the world’s poorest and most vulnerable? I think there are savings that can be made, but let us make sure that they are made in the right way. With a heavy heart, I support this, but can we please make sure that we return our international aid budget to 0.7% as soon as we possibly can?
Claire Hanna (Belfast South) (SDLP) [V]
I thank Mr Speaker for allowing this emergency debate.
The decision to abandon the Government’s own manifesto commitment was not just morally regrettable but, like a disturbing number of actions by this Government in this term, it was unlawful, too. The Government have again bypassed Parliament and demonstrated contempt, in that it has taken until today, in an emergency debate, to address this matter. I commend those Conservative Members who have secured this debate for their articulation of our shared norms of global interdependence and of democratic norms.
Although I appreciate that nobody who has spoken is relishing this change, we have heard from cheerleaders of the policy that we need to help our own instead. That false binary might just ring true if those same voices were not actively advocating against meaningful pay for healthcare workers and against funding catch-up education, and if they were not actively misrepresenting, with tabloid myths that insult the intelligence of the public, the real achievements that the UK has made through aid. Nobody credible denies the serious economic contraction in the situation that we are in, but we are advocating that a principled choice be made, and that this Government and nearly all Members of the House keep a promise that they made.
Last November, speaking about the security and defence review, the Prime Minister said:
“Britain must…stand alongside our allies, sharing the burden”—[Official Report, 19 November 2020; Vol. 684, c. 487-488.]
But this retreat does the opposite. For the first time in many years, development progress around the world is going backwards. Reports estimate that 200 million people will be pushed back into extreme poverty because of the pandemic. Decades of practice and evidence under- score the truth that long-term development investment, the like of which UK aid successfully supports, creates resilience that helps the poorest and the most vulnerable to withstand the economic and environmental shocks that are becoming more frequent, which in very large part is due to our actions and our consumption.
This cut is, at the very best, penny wise and pound foolish, because economic investment in aid is far-sighted. Well-nourished children will learn well in school; empowered and informed women will see their children survive and thrive; innovative, invested farmers will be able to feed their family and have more for market. Aid also creates a more secure world. Draining the reservoirs of poverty guards against extremism taking hold and creates a safer future for us all.
The UK’s development record of being a generous aid supporter has been something to be really proud of. Like many hon. Members, I have seen the effect of that money in practice many times, having worked for over a decade in the aid sector. As an Irish MP in the UK Parliament, I think it fair to say that some of the rhetoric and symbolism that I hear around sovereignty, militarism and flags does not move me politically, but like many others, I have been deeply proud of the UK’s record on spending and effectiveness in aid. It is the mark of a serious global actor and an inclusive, modern, progressive union of people.
Whoever policy decisions like this are designed to appeal to, please let us not forget that there is a mainstream of public opinion that believes in multilateralism and generosity—we exist as well. The UK’s aid spend saves lives around the world, but it enriches all our lives here as well, and it should be protected.
Harriett Baldwin (West Worcestershire) (Con)
Mr Deputy Speaker, may I thank you and Mr Speaker for allowing today’s emergency debate and congratulate my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) on securing it?
I have had the privilege of representing the UK as a Minister in the Foreign Office and the Department for International Development and of seeing, around the world, the good that our aid budget does. Whether from our work in the midst of the Ebola outbreak in the eastern part of the Democratic Republic of Congo—where the fact that the UK had invested in vaccines and their cold chain deployment meant that we were able to contain that deadly disease—or from the work that we put into neglected tropical diseases, which has meant that we have been able to contain and control other diseases from reaching the UK, surely we should have learned how important it is for the UK for us to work on such shared global challenges for humanity.
I have had the privilege of going to Goma, near where the volcano is erupting, and seeing how we have brought fresh water there. It was UK expertise and UK firms that won the contract to do that, which benefits our economy here and those exporters as well. It is a win-win for the UK public and for the world. I feel very strongly that it was a great privilege to say that we were—as we used to be—the only G20 country that met its NATO 2% target and the 0.7% UN target for aid. Surely if global Britain means anything, it means that, and being able to say that so proudly.
I was particularly proud to stand on a manifesto that again committed to those metrics for our position in the world. Politicians hesitate to break manifesto pledges because they know that the electorate will punish them at the next election if they do, whether they are George H. W. Bush saying “Read my lips: no new taxes” or Nick Clegg with his tuition fees. People realise that they should not break manifesto pledges because the electorate dislike it, but in this case I feel that the people who benefit from our aid budget the most are the ones who have no voice in this place. I have met them, and I need to articulate on their behalf how important this spending is.
There is another reason why I feel particularly passionate about the subject: the fact that we have enshrined the 0.7% in law. I know that there is a get-out in section 2 of the 2015 Act, under which a Secretary of State who inadvertently does not meet the 0.7% target can come to Parliament, explain why and state how they will get back to it. However, actually targeting 0.5% is absolutely a contentious legal issue and something that I think may well be challenged in the courts. The Government have a large majority, so the simplest thing to do, if it is such a good idea, would be to come to Parliament for that consent. The power that the Executive have is derived through us in Parliament; therefore they need to show respect for Parliament by coming and asking us, and giving us a vote, as my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) put it so powerfully.
I could expatiate at length about how passionately I feel that we are making the wrong decision, but in this week, when we are hosting the G7, when we need to vaccinate the world and when cases are really beginning to grow exponentially across many African and Asian countries, and when we heard last week from every country at the 142nd Inter-Parliamentary Union Assembly that they need the vaccines, let us get out of this hole by giving our vaccines to the world.
Kerry McCarthy (Bristol East) (Lab)
I congratulate the hon. Member for West Worcestershire (Harriett Baldwin), the former Minister, on her speech. She speaks very powerfully from her own experience of visiting projects. When I was first elected back in 2005, the first overseas visit I was invited to go on was when Oxfam took me to the camps for internally displaced people in the north of Uganda. I had never seen poverty on that scale. It was very much like the sorts of images that we would have seen during the Live Aid broadcasts. That made a huge impact on me, and I have seen on other overseas trips—for example, to look at our disaster relief effort after the earthquake in Kashmir—how much good we can do on the ground, often with very small but much-needed amounts of money.
Many of us sometimes get criticism for travelling abroad as MPs, but it really brings home to us the importance of such pledges. It is frankly shameful that during a global pandemic, when the need for international leadership and support for poorer countries is greater than ever, the Government would renege on their commitment to support the poorest people of the world without bringing it to the House for a vote.
The pandemic has fuelled an increase in gender-based violence, disrupted children’s education, increased food insecurity and threatens access to crucial healthcare. And yet, as we have heard, the UK aid budget for education has been slashed by 40%. UNICEF has lost 60% of its core funding, and the United Nations Population Fund has lost 85%, which it says could mean 250,000—a quarter of a million—more mother and baby deaths. In Yemen, home to the world’s worst humanitarian crisis, we are cutting funding by nearly 60%, while refusing to suspend arms sales. The International Trade Secretary has said in response to letters that I have written to her that current arms exports are legal and match the consolidated criteria, but we cannot simultaneously be peacemaker and arms dealer.
I want to make a special plea today, though, for the Government to recognise, ahead of COP26, our obligations towards climate-vulnerable countries. These countries bear very little responsibility for our changing climate, yet are most affected by its consequences, be they rising sea levels, changing temperatures, droughts, declining crop yields or extreme weather events, which are becoming ever more frequent and more severe. There is an urgent need for more funding for climate adaptation, as well as aid to help to address the deepening inequality linked to climate change; and, as we play host to the G7, we should be leading on debt relief for the poorest countries, too. We cannot carry on giving less with one hand and taking away with the other.
I also want to flag up the plight of the small island developing states, as chair of the new all-party group. Although the UN has recognised SIDS as having particular social, economic and environmental vulnerabilities, the common metrics used to determine vulnerability and need when it comes to ODA do not take that into account. As a result, many SIDS do not qualify for aid, yet work by the United Nations Development Programme on a multidimensional vulnerability index shows that the majority of SIDS are far more economically vulnerable than their income level would suggest. SIDS are not only facing some of the very worst consequences of climate change; they have also been devastated financially by the pandemic because of the collapse in tourism and are particularly prone to extreme weather events and other natural disasters. The recent volcanic eruption could cost Saint Vincent and the Grenadines up to 50% of GDP. Other SIDS are trapped in a vicious cycle of debt, including Belize, which has defaulted on or restructured its debt five times in the last 14 years.
To conclude, we are facing the biggest global challenges in our history, with a pandemic that has devastated the global economy and a rapidly changing climate. We know that some nations are more prepared than others for these challenges, and we cannot turn our backs on the vulnerable now.
Neil O’Brien (Harborough) (Con) [V]
The last year has had unprecedented effects on our economy, our public services and the world, and it has left us facing some profound choices this autumn. For all the reasons that numerous Members have mentioned in the debate, none of us wants to have to make these changes to international aid spending, but if we look at the promises we have made, we will see that we face some very difficult choices this autumn. We have promised to help children catch up on their education, and tomorrow we will have a debate in which numerous Members will say that they want to spend more on that. We have promised to catch up on the NHS backlog, which has inevitably built up during a year in which nurses, doctors and everyone working in the NHS have worked overtime and worked their socks off. They have been under an unprecedented level of strain, which has caused a large backlog in NHS demand.
We also face long-standing questions such as the crisis in social care in local government. Again and again in my surgeries, people come to me to complain about squalid conditions, the difficulty of accessing care and the impossible burdens of paying for care. Last but not least—and I declare an interest here—there is the whole question of levelling up and the many things that we promised to do to change the grotesque inequalities in life expectancy and the grotesque differences in income levels and opportunity around this country.
We have many, many promises to keep. Over the last year, we have done unprecedented things to save jobs and livelihoods—we have spent like never before—and because of that, we now face some very difficult choices. I am not somebody who decries the value of aid. I can see that it does much good around the world, and we will continue to be one of the world’s biggest spenders. None the less, I think that to be in government is to make choices. We face difficult choices, and we have many promises to keep on lots of fronts.
Ultimately, all of us are elected to serve the people and to be servants of the people. It is clear to me from every poll I see and every conversation I have that the public know that we have to make choices. They know that we have to prioritise, and the things that they tell me they want to prioritise the most are our health service and giving opportunities and jobs to the places that need them. These are horrible choices to have to make. I salute all colleagues on the other side of this argument who have come to a different view from mine. None the less, with a heavy heart, I think that this is the right thing to do because of the difficult choices that we face.
Afzal Khan (Manchester, Gorton) (Lab) [V]
We have a moral duty and, currently, a legal obligation to help those in need. Whether it is securing girls’ education or responding to humanitarian crises in conflict zones, aid can be the first and last hope of improving lives. Britain is the only G7 nation to cut aid during this global crisis, and now its allies are taking note. With the G7 summit set to begin later this week, the Government’s stubborn refusal to reverse this decision will weaken the country’s position considerably. The US Congress has already written a letter urging the UK to reconsider its position.
For aid to be truly effective, the recipient must have consistency and reliability, and that is currently at risk under this Government. My constituent Nicola Sansom is the CEO and co-founder of SALVE International, a small international development charity that has been supporting street-connected children in Uganda since 2008 to have a brighter future through education and family reunification. She had been awarded a grant worth £50,000 from the small charities challenge fund but then received the devastating news that it had suddenly been cut. Nicola’s case is just one of many. Given the last-minute decision to cut funding for SALVE, can that funding be reinstated, so that the hard work done by the organisation does not go to waste and it can make a genuine difference to girls’ education in Uganda? Can the Minister confirm his commitment to get 40 million girls into school by 2025, in the light of an estimated 25% cut to girls’ education funding? How does he expect to fulfil this commitment without adequate funding to ensure that girls are not subjected to violence, abuse and harassment?
In the light of the recent events in Palestine that saw complete disregard for international law by Israeli forces, United Nations Relief and Works Agency funding provides much-needed aid, vital help and educational programming, and helps to strengthen co-operation between Israelis and Palestinians. Given the ongoing blockade of Gaza and the devastating human rights violations, can the Minister guarantee that the UK funding commitment to UNRWA will not be involved in this Government’s discriminatory cut to the UK’s aid budget?
There is an undeniable case that UK aid helps the world’s poorest and most vulnerable. During this difficult time, it is even more important that we continue to empower the powerless.
Anthony Mangnall (Totnes) (Con)
I congratulate my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) on everything that he has done to get this debate, and the team behind him on their extraordinary job in helping to run this campaign.
It is, of course, no easy thing to go against the grain of one’s party—although given the amount of times I have rebelled, I am not sure the Whips are going to believe that of me—but I do not do it lightly. I do it with the consideration of why I was sent here, what I believe in, and what, given their views, people who support this party would expect us to do.
Over the course of my time in Parliament, we have had numerous debates about global Britain. For me, it is quite simple: the definition of global Britain and what it embodies is defence, diplomacy, trade and, of course, development. Each one of those pillars relies heavily on the other. Our trade ambitions, our defence operations, our diplomatic networks and our development programmes all peak and trough depending on one another’s successes. Whatever the variation, that quartet of sectors helps to promote Britain on the world stage. They represent a Britain that, as my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) pointed out, does not step back but steps forward. In trade, we are striking many new positive free trade agreements; we are being ambitious, global and outward-looking. In defence, we are sending our aircraft carriers around the world. Our diplomatic network is still viewed as one of the finest in the world. Up until last year, I would have maintained that our commitment to 0.7% was not just the correct thing to do but an act of global leadership that benefits our trade, defence and diplomatic missions, all of which are truly reflective of global Britain. In committing to the 0.7% target, we offered not just warm words but firm action for those most in need.
I have listened carefully to the words of colleagues during this debate and over the course of the past year. I have heard all too often that we simply cannot afford to pay for the 0.7% development budget given the pandemic and the economic climate. Leaving aside the fact that the 0.7% target fluctuates depending on the strength of our economy, ensuring that in good times there is more money and in bad times there is less, I humbly remind everyone in this House that we brought it in in the wake of the financial crisis, when our economic growth was possibly at its lowest, with no forecast to boost it.
Mr Mitchell
My hon. Friend is making an extremely good and sensible speech. May I thank him for the immense amount of hard work and leadership he has undertaken in advancing this argument and getting it to this point today?
Anthony Mangnall
That is incredibly generous of my right hon. Friend and I appreciate it.
We stood up just post the 2010 election because it was the right thing to do and because it demonstrated our global leadership and encouraged others to follow suit. It is simply not the case that other countries have not followed suit, with France and Germany now hitting the 0.7% target and America doing likewise, reflecting the fact that our leadership has encouraged them to do so. With a new President in the United States who is reaffirming the rules-based order, we can truly say that we have a global group that will support 0.7%, but not if we do not stick to our guns on this. We have been able to assist in humanitarian crises and conflict zones around the world. We have been able to address the health issues, sanitation issues and education issues, but all that has been put into jeopardy. As has already been mentioned, with this cut from 0.7% to 0.5%, we are cutting global health budgets —down by 14%; girls’ education—down by 25%; clean water—down by 80%; the Joint United Nations Programme on HIV/Aids—down by 80%. All these budgets are being cut during a pandemic where the problems are exacerbated as opposed to diminished. No impact assessment has been undertaken and no review has been done of what those cuts would mean to the different organisations. It is a simple stroke of the pen, no vote in Parliament and absolutely no consideration for the consequences.
It is a staggering miscalculation to ignore our international obligations and moral duties, because we cannot protect ourselves at home if we do so. Many have argued that that money should not be spent abroad, but if we wish to tackle terrorism, asylum and climate change, we have to be out there. We have to be co-operating on an international scale to ensure that each of these points is addressed and that we live in a truly globalised world.
We have been told that tough fiscal decisions will have to be made, and I accept that. I recognise the extensive cost of the Government’s very generous support packages, but as of today, the only area in which the Government have cut funding has been the 0.7%, minus of course the public sector pay freeze. Perhaps the Minister —when he returns to the Chamber—might answer why that is. The party committed to 0.7% in 2019, 2017, 2015 and 2010. We all won those elections on the basis of promising that to our electorate. It would be a shame if we could not stand up for the promise to the world’s poorest people that we made to our electorate and deliver on all the programmes depending on UK funding.
Florence Eshalomi (Vauxhall) (Lab/Co-op) [V]
I thank the right hon. Member for Sutton Coldfield (Mr Mitchell) for his persistence in bringing this issue to the House today. I am deeply concerned by the UK stepping back from its responsibilities to the world’s poorest and abandoning its commitment by cutting aid, and so are many of my Vauxhall constituents who have contacted me.
Six years ago in 2015, we were the first G7 nation to enshrine in law our commitment to the UN’s target of 0.7% of gross national income on overseas aid. As we prepare to host the G7 summit at the end of this week, the UK is breaking its promise, while other G7 countries such as France and the USA are maintaining or increasing their aid commitments. This is not the global Britain we want the world to see. The aid budget should be used to tackle the global challenges facing us all: the pandemic, the climate crisis and rising poverty and inequality.
A few months ago on 8 March, we celebrated International Women’s Day, and men and women across the UK spoke out against violence against women and girls. We can choose to challenge and call out the inequality we know that so many women continue to face. I am sure that Members across the House would agree that one of the best ways to help address that inequality is to ensure that women and girls have access to vital education —not only at home here in the UK, but right across the world.
The UK’s ambitious targets of getting 40 million more girls into school and 20 million girls reading by the age of 10 by 2026 have been adopted by the G7. Indeed, the Prime Minister said a few weeks ago on 12 May:
“Supporting girls to get 12 years of quality education is one of the smartest investments we can make as the world recovers from Covid-19. Otherwise we risk creating a lost pandemic generation…I’m going to be working throughout the UK’s G7 presidency to ensure leaders invest in those girls and boost children’s life chances around the world.”
Reducing the aid budget is in direct contradiction to the rhetoric from the Prime Minister a few weeks ago and the reality faced by millions of people working across the world to support women or girls and many others across the aid sector. The cuts will have far-reaching consequences for some of the world’s most marginalised and vulnerable people. Projects such as the International Rescue Committee’s Girls’ Education Challenge—the UK’s key programme for supporting girls’ education in Africa and Asia—could now be at risk because of this cut. I am concerned by the UK’s sudden role—[Inaudible.]
Mr Deputy Speaker (Mr Nigel Evans)
I think we have just lost Florence. I am terribly sorry. [Interruption.] I think we will have to leave it there. I call Pauline Latham.
Mrs Pauline Latham (Mid Derbyshire) (Con)
Thank you for calling me, Mr Deputy Speaker, a little earlier than I anticipated.
I congratulate my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) on securing this debate—sad though it is that we have to have it—and thank Mr Speaker and the Deputy Speakers for allowing us to go ahead. The saddest part is that we will not be allowed a vote on the issue. We will not be able to decide democratically what this House wants to do. It has been decided for us.
I am very disappointed that the Minister is not in his place at the moment, because I wanted to paint a picture of the things that I have seen when travelling with the International Development Committee. I want everyone in the Chamber to imagine that their daughter has got married young, too young, and that there is now no contraception for that daughter, so she has a child early. However, we have not managed to help that future mother with nutrition, so when she has her baby—if she survives it—she will have a child who is stunted. That could be in any country that we help, because those are the poorest people in the world.
The child will never get the brain power it deserves, because it has been starved during the gestation period, but we are cutting the amount of money for nutrition, so he or she will never catch up—can never catch up, because once someone’s brain is stunted, it can never do so. None of us in this Chamber wants to see that happen, but that is the reality of it. The mother could die because there is no contraception, the child will not reach its potential because it is stunted, and the child might never have a job and so afford to send its own children to school. The cycle goes on and on.
The problem is that we will be partly responsible, because we are cutting our aid budget so much. I have seen some of the figures, and the hon. Member for Rotherham (Sarah Champion) listed a lot of the cuts, which seem totally random and not thought through—“Oh, we’ll just cut that!”, or, “Yes, we’ll do that!” I think that the problem with some of the Ministers who have made the decisions is that they have not been to see for themselves the devastation of the impact on those poor people, the poorest people in the world, whom we as a very rich nation by comparison should be helping.
I have spent 11 years in this place, sitting on the International Development Committee, so I have seen the good that our aid has done. It is not perfect; we do not always get everything right, but we get a hell of a lot right to help those poorest people. We have saved lives—but we will lose lives.
The Minister is not a callous man or a cold man, and I am sure that when he made his speech, it was not one that he wanted to give. I am sure that he will do what he is told and give the speech he has been given at the end of this debate, but I am disappointed. I hope—now he has returned to the Chamber—that he will read what I have said about what we are doing to the poorest people in the world. He should go back to the Treasury and to the Prime Minister to say, “We are wrong.” It is as simple as that. Let us change our policy and go back to 0.7%.
Mr Deputy Speaker (Mr Nigel Evans)
We are trying to get Florence Eshalomi back, to give her the last minute. We will see how that goes.
Hywel Williams (Arfon) (PC)
I am grateful to the right hon. Member for Sutton Coldfield (Mr Mitchell) for securing the debate. I admire the authentic passion that he brings to this subject.
I oppose these unjustified and unwise cuts to aid. The Government are said to be motivated by a wish not only to balance the books and manage public spending, but to court popularity in the red wall seats. I can tell the Minister that opinion in Wales is very much against the Government on this and it will do them no good. When we get that long-overdue by-election in the north-east of Wales, they will see that for themselves.
From a Welsh perspective, I note that smaller European countries—Denmark, Sweden, Luxembourg, Norway—have met their 0.7% of GDP targets. Indeed, Sweden has provided not 0.7% but 1.14% of its GDP in aid. Sweden and the others can do this, and they achieve the 0.7% and more. Unfortunately, the UK can but chooses not to do so.
Leading figures in Welsh public life and local constituents alike have expressed their dismay, describing this cut as a double blow to the world’s poorest communities at the time of a pandemic. The Welsh Government themselves, in their policy documents on international matters—their agenda—say that they are
“committed to promoting social justice, fairness and equality”.
What value have those fair words from the Welsh Labour Government when we are tied to and overruled by this mean-spirited, short-sighted policy from the Westminster Government?
The United Nations Population Fund is to be cut by 85%, UNICEF’s core funding to support children by 60%, and total funding by £4.5 billion. Those figures would be a disgrace to any country, but given this Government’s pretensions to be a leading global power and an example to others, they are not only a disgrace but a major self-inflicted blow to the UK’s international standing.
I referred a moment ago to the United Nations Population Fund. What does that cut mean in real terms? Funding is to reduce from £154 million to £23 million, which will lead, it says, to up to 7 million unintended pregnancies, 2 million unsafe abortions and 23,000 maternal deaths. UNICEF says that it is “too soon” to judge effects, but
“children…in some of the world’s worst crises and conflicts will suffer”
as a consequence—as a deliberate effect, unfortunately—of this policy. Lastly, Save the Children says:
“These cuts will trim UK borrowing by a fraction, but devastate lives across many of the world’s poorest countries.”
Because of all that, I join others in appealing to the Minister and the Government to withdraw these cuts.
Margaret Greenwood (Wirral West) (Lab) [V]
As host of this year’s G7 summit, which takes place later this week, the Government should be leading by example. Instead, they are abandoning their responsibilities to the world’s poorest and most vulnerable people. The Government’s plan to cut UK aid to developing countries will have devastating consequences.
The Government’s decisions will mean a cut of nearly 60% in humanitarian funding to Yemen, in the face of what is considered the world’s worst humanitarian crisis; a cut of 40% in aid going to education, resulting in 700,000 fewer girls receiving an education; and a cut of more than 80% in aid for water, sanitation and hygiene projects in developing nations. The Government should be ashamed.
Save the Children has highlighted that
“areas critical for children like basic nutrition, family planning and reproductive healthcare are all set to see substantial cuts”.
Several constituents have emailed me in recent days to echo that. They have raised concerns that the cuts will have far-reaching consequences for the world’s most marginalised children, especially girls, at a time when they most need our support. In their view and mine, Ministers have turned their back on the world’s most vulnerable children.
How can the Government claim that the UK remains a world leader in international development? In cutting aid from 0.7% to 0.5% of gross national income, the UK will drop from the third largest donor in the G7 to third from last, damaging our reputation and credibility on the world stage. The Conservatives’ 2019 manifesto stated:
“We will proudly maintain our commitment to spend 0.7 per cent of GNI on development, and do more to help countries receiving aid become self-sufficient.”
So much for election promises.
The 0.7% overseas aid target is enshrined in law. Lord Macdonald of River Glaven, a former Director of Public Prosecutions, has made it clear that the Government’s decision to cut foreign aid without passing new legislation is “unlawful”. The Government have said that
“we will return to our commitment to spend 0.7% of gross national income on development when the fiscal situation allows.”
That is to ignore the immense suffering that the cuts will cause right now. One Wirral West resident who wrote to me with her concerns said:
“There is a danger that, once reduced, it will not return to 0.7%. Other excuses will be found.”
Numerous charities that work in climate and international development—including Greenpeace, Christian Aid and WaterAid—have said that the cuts will make it harder for countries to respond to climate change, and that they
“will inevitably harm the most vulnerable in society, pushing huge numbers back into poverty”.
Ministers should consider the long-lasting damage that their callous, short-sighted and counterproductive cuts to the aid budget will do to the UK’s reputation globally. There is significant opposition in this House and right throughout the country to the Government’s decision to cut overseas aid. The Government must think again, and they must maintain the commitment to 0.7% for international development.
Mr Laurence Robertson (Tewkesbury) (Con)
I, too, oppose the cut in official development assistance spending from 0.7% to 0.5%. As we have heard, the fact that the percentage is based on the economy means that there is a reduction anyway, so the cut can be described only as what used to be known as a double whammy—a hit on some very poor people in the world.
In preparation for this debate, I asked the Ethiopian embassy to give me some thoughts on what the cut means to Ethiopia, which is the second-largest beneficiary of UK aid. As the chairman of the all-party parliamentary group on Ethiopia and Djibouti, I am very proud of that fact and of what we have achieved in Ethiopia. The embassy told me that we have improved access to education, to primary healthcare and to clean water, and resilience to crises such as famine. There we have it: education, health, clean water and food—things that we in this country take for granted.
As many people are, I am from a very ordinary working-class background, but I never had any problems with food, water, education or healthcare. I was very lucky—we were all very lucky—to be born in this country. We did nothing to deserve to be born in this country, where we have all those privileges. We were extremely lucky: millions of people in the world do not have that good fortune. I want us to continue to provide those benefits to countries such as Ethiopia and to many other countries.
It is important that we retain the 0.7% target, because it is not just about cash or money; it is a totemic policy that was put in place as a guide and an encouragement to countries around the world so that they, too, may meet that target. We cannot do it all on our own; we need other countries to help. We cannot tackle climate change all on our own; we need other countries to help.
I am of course very proud of this country and very proud to be British, but we have to recognise that over the past 200 or 300 years we have enjoyed the fruits of the industrial revolution, which all started where I come from in the north-west of England. We have enjoyed the prosperity that came from that; other countries have not enjoyed that prosperity. If, to tackle climate change, we say to those countries, “You can’t do the same as we did”—understandably, because we have a world crisis with climate change—we have to help them to get over it. That is another reason why we should continue with the 0.7% target.
I supported the coalition Government in their attempts to reduce the massive deficit that we had between 2010 and 2015, but nobody in this country will benefit from cutting this £4.5 billion. We have spent upwards of £300 billion on rescuing the economy because of the covid pandemic. That is nobody’s fault—we had to do it. Nobody in this country will benefit from our saving £4.5 billion, but many, many people around the world will suffer if we save that £4.5 billion. I cannot support that policy.
Supporting correctly targeted and transparent international development aid was one of the reasons I wanted to come to this place. There would be no shame on the Government if they were to turn round now and accept that they have got it wrong and reverse this policy, and I ask them to do that.
Ian Paisley (North Antrim) (DUP) [V]
It is a pleasure to speak in this debate and to follow the hon. Member for Tewkesbury (Mr Robertson).
The overseas aid budget is very, very important, so this debate is incredibly welcome, as it will allow Parliament —not Government—to have its say about the importance of this issue. Unfortunately, the Government’s stance has managed to offend every single church group and charity group that I know of in my constituency. They are appalled by the fact that the Government have sought to undermine the aid budget in this way and to break a solemn promise that they made to the electorate. In fact, it is a promise that they appear to have made on behalf of the whole House, not just their own party.
UK charities have been impacted on unfairly by this decision. The Government need to look at that particular. When charities go out there, make their stand, lobby, and say that they are going to achieve things, their credibility goes on the line. In this case, it has been snatched away from them, not by something that they have done but by something that the Government have done.
I am sure that the Government did not think that, tonight, they would be able to unite the Labour party, members of their own party, the SNP, the Democratic Unionist party and the Liberal Democrats, but they have succeeded in doing so, ensuring that the opposition to what they are planning to do with the aid budget is voiced.
Her Majesty’s Government are breaking their promise made not just on behalf of themselves, but on behalf of everyone in the UK. People voted at the last election with an expectation that this would be done. All the parties were committed to this. It became the law, and now that promise will be breached by the Government. In doing that, they damage the reputation of this Parliament, and they damage the reputation of all parties here. This is a solemn breach, and they must mend it.
The overseas aid budget is our soft diplomacy around the world. We have heard many speak about that and about how other countries engage in much harsher and harder diplomacy—currency-led diplomacy. This is a soft diplomacy that shows that we care, that we are a passionate people. Removing and reducing it says more about who we are as a nation than it does about anyone else. I implore the Government to reconsider this matter urgently.
The Government have set out all their excuses from the Front Bench, but none of them add up economically, morally, or politically. I therefore say to them that they need to revisit this and revisit it fast. If they try to repair the damage, it will just cost them more money. They should just reverse the decision and put it right—just fix it. This is something that we as a nation can afford and that we want to pay for. This is taxpayers’ money and the taxpayers say that they want this to be done. We recognise that the UK economy is in a better place than we had expected, and so it can afford this. Let us keep our word as a Parliament. Let us keep our word as a nation. I implore the Government to keep their word and to deliver on their promise.
Matt Western (Warwick and Leamington) (Lab)
This should not be about political advantage. It is about hundreds of millions of people around the globe whose lives, already fragile existences, are made more vulnerable now by the political calculations, as we have heard, of the Prime Minister and the Chancellor. That is their decision. It is a choice for them to claim that this nation is now free to forge its own future, but they are demeaning our international stature by this decision—a reputation reduced at a stroke, as is so often the case under this Government.
This comes at a time when the world would ordinarily be hoping for greater leadership, as we host the G7 as well as COP26 later this year. As we have heard, we are the only G7 country to cut its ODA budget, while others, such as the US, Germany and France, are increasing theirs. I am afraid that cutting the ODA budget at a time when less developed nations are the most vulnerable globally to the pandemic will be seen as one of the most callous choices made by a Chancellor in our lifetime.
It is telling that so many across this House concur with former Prime Ministers of all hues. As we have heard, we are talking about a humanitarian aid cut of 70%. That includes funding to Yemen, considered the world’s worst humanitarian crisis, cut by 60%; life-saving water sanitation and hygiene projects in developing nations cut by 80%; aid going to education cut by 40%, which will result in 700,000 fewer girls receiving education according Save the Children’s analysis; and funding for the global polio eradication initiative cut by 95%. On the micro scale, the small British charity Dhaka Ahsania Mission UK has had its FCDO grant for work in northern Bangladesh cut by 100%. That programme was to bring basic education to some of the poorest and hardest-to-reach rural children in Bangladesh, whose families live and work on some of the most marginal land within the flood areas of the north of the country.
The Government’s drastic cut to overseas aid also risk damaging the world’s ability to fight the next global health disaster, which in turn, in self-interest, would keep Britain safe. In an open letter, 3,000 UK academics and global health experts highlighted how critical our interdependencies are across our world. The health risks and vulnerabilities are shared globally, and so should be the solutions if we are to address the emerging health threats. Just over 2% of Africans have been vaccinated, whereas more than 75% of all vaccines have been administered in just 10 countries.
The decision to cut official development assistance funding means that UK Research and Innovation needs to find savings of £120 million in allocated funds in 2021-22, hitting more than 800 Global Challenges Research Fund projects—for example, Warwick Medical School’s work in Africa on digital health and the introduction of remote consulting. In response to the pandemic, clinics have been contacting patients by phone, rather than offering in-person visits, for the first time in the continent. There is also the example of Newcastle University—perhaps the hardest-hit of all—which is doing leading work on water security and resilience to climate change, and on river deltas, flooding and rainwater. It is working with 90 partners in 20 countries, helping them and stemming migration.
Those projects have shown Britain at its best. They have shown it as reasonable and reliable—but no longer, due to the cuts. We are happy to see an aircraft carrier travel around the world, but at the same time cut projects to the most deserving. Perhaps the most depressing thing was hearing from the right hon. Member for Haltemprice and Howden (Mr Davis), who said that this is something of a political gambit to win votes.
Dr Philippa Whitford (Central Ayrshire) (SNP) [V]
The Prime Minister has declared his aim to secure an agreement of the G7 to vaccinate the world against covid by the end of next year, but it is hard to see how he will have the brass neck to push such a proposal when the UK will be the only one in the room cutting overseas aid. The overall budget is being cut by a third, but covid funding masks the drastic cuts to core projects, including on the health and education of women and girls, which the Government claimed was a key policy, as well as those delivering humanitarian aid and addressing HIV/AIDS, conflict zones, famine relief, refugees and child education. It is hard to believe that the Government think it is remotely reasonable to slash funding for water and sanitation in the middle of a pandemic.
Even if funding is restored in a couple of years, the staff, researchers, experience, knowledge, networks and infrastructure of many of those projects will have been lost. The Chancellor has justified the cuts by highlighting the cost of the pandemic, but what does he think it has been like for low-income countries that were struggling even before they were hit by covid?
The UK is also hosting COP26, but any promises by the Minister responsible, the COP26 President, the right hon. Member for Reading West (Alok Sharma), will have little credibility, because when he was International Development Minister he made commitments that the UK has now abandoned. In 2019, he promised more than £100 million a year for the global polio eradication initiative, only for the funding now to be cut by an eye-watering 95%. The World Health Organisation has estimated that 80 million children are at risk from infectious diseases such as diphtheria, polio and measles owing to the disruption of immunisation caused by the covid pandemic, so vaccination projects should not face cuts. They need extra support to fund the necessary catch-up programmes. We must not allow the re-emergence of polio and other infectious diseases to take a toll on the children of low-income countries.
Covid is a global crisis and it calls for a global response. So far, the international community has struggled to live up to its warm words of last spring, but the UK is alone in cutting aid at such a critical time. Low-income countries have received less than 0.5% of all covid vaccines delivered so far, and the UK is one of those blocking the sharing of intellectual property and technology. This will prolong the pandemic for all of us and delay the economic recovery of low-income countries, and the UK Government must not compound the problem by removing support from some of the most vulnerable in the world. I support the call to restore overseas funding, and I do not believe that it can wait until next year. The covid crisis is now.
Alexander Stafford (Rother Valley) (Con)
I rise today to make a simple yet resounding contribution to the debate on behalf of the people of Rother Valley, who wholeheartedly support the Government’s decision temporarily to reduce foreign aid from 0.7% to 0.5% of our GNI. The coronavirus pandemic has resulted in the most severe economic situation in 300 years, and residents across my constituency are experiencing great hardship, from losing their jobs to struggling with their mental health. My position is clear. I was elected to look after the people of Rother Valley first and foremost, and I shall do exactly that.
I cannot support proposals to allocate 0.7% of our GNI to foreign aid when there is deep-rooted poverty in my own constituency. Across Rother Valley, the claimant rate is about 5.5% and youth unemployment stands at about 10%. This has massively increased because of the coronavirus pandemic, and it is far too high. For example, in Maltby a staggering 8% of all the residents are unemployed. In fact, Maltby in Rother Valley is one of the most deprived wards in the country, and this situation is mirrored in other pockets throughout Rother Valley, such as Swallownest and Dinnington. That is where our aid money should be going. That is where the support should be going during this national emergency. It should go towards helping to level up Rother Valley for the British people.
But more importantly for this debate is the fact that we are not donating our own money. We are not donating taxpayers’ money for foreign aid, although that in itself would warrant examination; instead, we are sending abroad money that the Government and the state are borrowing. That’s right: we are borrowing money when we can least afford it so that we can send it abroad to foreign powers. How ridiculous that sounds! We are in debt, and getting further in debt because of the coronavirus pandemic, yet we are borrowing more money so that we can send it abroad. This is not our money; we are borrowing this money, and we are getting our own country into more and more debt. Surely we cannot afford to do that at this point.
On top of that, we should be careful about where some of this money is going. We are sending vast sums to dictatorships, to countries with space programmes and nuclear programmes, and to nations that have been receiving aid for decades with little change or positive results. It is a disgrace that we are sending aid to the People’s Republic of China—a hostile state with advanced military and industrial programmes led by a communist regime that threatens the rules-based world order and British interests across the globe—while we still have homeless veterans sleeping on our streets. That is not acceptable.
Mr Mitchell
My hon. Friend mentions China, and that is a very good point because we should not be spending any aid in China. It was cancelled on my first day in office 10 years ago, unless it was legally required, and I am afraid that, in my view, the aid is being spent wrongly by the Foreign Office.
Alexander Stafford
I thank my right hon. Friend for that clarification, but owing to the time I will move forward and end my speech shortly.
Of course we should donate money to the most vulnerable, and my right hon. Friend the Minister has mentioned those who most need it. We should never forget that the UK is the third largest donor in the G7, donating more than £10 billion this year alone, and that we have led the world in providing vaccines to poorer countries, but what seems to have been lost in the noise is that the Government have committed to returning the aid budget to 0.7% of GNI when fiscal circumstances allow. There is no doubt that this will be the case. In fact, the Conservatives are the only party to have ensured that we have met the 0.7% target—Labour has consistently missed it. That sums up the difference between the Conservatives and Labour: we are honest with people about the difficult choices that protect the British people. We are not flip-flopping; we are trying to make difficult choices at a difficult time, in this difficult situation.
Brendan O'Hara (Argyll and Bute) (SNP)
The decision by this Government to take essential, life-saving money from the world’s poorest people is absolutely shameful and it has confirmed, once and for all, that the idea of “global Britain” has already lost its moral compass. For this idea to have been confirmed at April’s integrated security review simply beggars belief; the idea that by making the world’s poorest people even poorer we somehow make ourselves safer is absolute nonsense and it takes gaslighting to new extremes.
Do the Government really expect us to believe that the best way to make the people of the UK more safe and secure is to slash vital humanitarian aid to parts of the world that are already ravaged by conflict, war and famine, and thereby to force tens of millions of people to uproot their families and go in search of a better, more secure future? It was breathtaking insensitivity, adding insult to injury, that that same Integrated Review announced that money that could and should have gone to help underprivileged and poor people across the world will instead be spent on increasing the UK’s stockpile of nuclear weapons—it is utterly abhorrent. This country has a historical moral obligation to those countries that are now in the developing world. We have to help them because we are responsible for where they are now. For more than a century the UK grew rich and powerful on the backs of the poor. The countries we invaded, conquered, divided and plundered need our help now and we cannot cut it off like this—it is abhorrent.
Madam Deputy Speaker (Dame Rosie Winterton)
I call Bob Seely, who has 90 seconds.
Bob Seely (Isle of Wight) (Con)
I shall try to sum up, Madam Deputy Speaker, by thanking my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) and my hon. Friend the Member for Totnes (Anthony Mangnall) for the debate, and by suggesting a compromise.
I am happy to sign up to 0.7%, but I think we need to work to change the definition, because the one we use is a technical, official one, and we can do better. I suggest broadening the definition of “aid”, so that it includes peacekeeping operations, and the BBC World Service and TV. If I were the Government, I would seek a compromise here to say that we will get back to the 0.7%, but let us work on a longer-term definition that broadens the definition of “aid” from purely economic development—that is what the current OECD Development Assistance Committee ODA definition is—to one that encompasses peacekeeping at the beginning of the developmental process and goes all the way up to the BBC World Service and radio and the support of civilisational values at the other end. That is a longer-term solution, rather than the stale and dry argument between “0.7% good, not 0.7% bad”.
Mr Mitchell
Madam Deputy Speaker, I thank you and Mr Speaker for granting this Standing Order No. 24 debate today. I urge the Minister here today, the Chief Secretary to the Treasury, to hear the voice of the House. He is a decent and understanding fellow, and I hope he will reflect on what he has heard this afternoon. I believe that only four of the very many people who have spoken supported the Government’s cuts, and I very much hope he will reflect on the innate decency of the British people in what he has heard from Members from all parts of the House this afternoon. The House is not with the Government on this and they should hear that. They should also hear the voices of their loyal Friends on these Benches; we want the Government to get it right. We are genuinely hugely concerned. We know that the cuts will lead inevitably to hundreds of thousands of avoidable deaths, and we are worried about the trashing of our international reputation. These concerns are shared across the House, by the Government’s friends, as well as by the people who are not warm towards this Government. I urge the Chief Secretary to consider what he has heard this afternoon and to reflect upon it in the discussions that he is having in the Treasury.
I note that my colleagues and I were referred to in a normally very wise national newspaper as the sort of people who, “Attend left-wing dinner parties in north London.” I confess that when I am London and not in my constituency of the royal town of Sutton Coldfield, I do live in Islington, but I should make it clear that most of my hon. Friends who have joined me today would not be seen dead at a left-wing dinner party, let alone one in north London.
I am extremely grateful to you, Madam Deputy Speaker, for chairing the debate and giving the House the chance to consider these matters, influence the thinking of the Treasury and its Chief Secretary, and try to ensure that we get this right.
Anthony Mangnall
On a point of order, Madam Deputy Speaker. Yesterday, Mr Speaker said that the Government should come forward with a vote in this House; he was pretty insistent on it, in fact. Today, I see that the press officer of No. 10 has suggested that there will be no vote on the 0.7% because the Government feel that they do not have to have one. Could you provide some guidance on whether that is in keeping with what Mr Speaker said?
Madam Deputy Speaker (Dame Rosie Winterton)
I thank the hon. Gentleman for that point of order, but I am afraid it is rather a continuation of the debate that we have had. I do not think there is much else to add to what Mr Speaker said yesterday, but I am sure that Members on the Treasury Bench will have heard the hon. Gentleman’s views.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill
Tuesday 8th June 2021
(3 years, 6 months ago)
Commons ChamberRead Full debate Compensation (London Capital & Finance plc and Fraud Compensation Fund) Act 2021 View all Compensation (London Capital & Finance plc and Fraud Compensation Fund) Act 2021 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Madam Deputy Speaker (Dame Rosie Winterton)
Before I ask the Minister to move Second Reading, I will introduce a three-minute time limit on Back-Bench speeches. As colleagues will know, this is a very short debate, but I will try to get in as many Members as I can.
The Parliamentary Under-Secretary of State for Work and Pensions (Guy Opperman)
I beg to move, That the Bill be read a Second time.
In the United Kingdom there are a wide range of opportunities for people to invest. The Government’s role is to try to ensure that the system of regulation and financial investment is suitably robust, so that individuals are treated fairly and have confidence in the financial system in which they invest. Unfortunately, no system of regulation can completely eradicate the risk that firms fail, or that there are bad actors intent on committing fraud. This short Bill is aimed at two areas where it is necessary for the Government to step in.
Clause 1 relates to a new Government scheme to compensate London Capital & Finance bond holders who lost money after the firm entered administration in 2019. Clause 2 will arrange a loan to the board of the pension protection fund to pay compensation to occupational pension scheme members who have been victims of pension fraud, following the recent High Court judgment in the case of PPF v. Dalriada. I will now expand briefly on those measures in detail.
Gareth Thomas (Harrow West) (Lab/Co-op)
The Minister will understand that part of the reason why we are here today is because of Dame Elizabeth Gloster’s excoriating report into the capacity of the Financial Conduct Authority. Is he certain that the FCA now has the powers and, crucially, the capacity it needs to ensure that consumers of financial services businesses are properly protected?
Guy Opperman
Yes, I believe that is the case. The Treasury and the FCA are working together. The FCA is under new management, as the hon. Gentleman will be aware, and there is an acceptance by the FCA of all the findings in Dame Elizabeth Gloster’s report. More particularly there is fresh thinking, one hopes, that will be applied going forward.
Kevin Hollinrake (Thirsk and Malton) (Con)
Will the Minister give way on that point?
Kevin Hollinrake
Powers are one thing, willingness is another. The FCA has shown a remarkable reluctance to hold people to account for incompetence or bad actors, as the Minister said. Will not those failings simply continue unless the FCA starts identifying individuals, within its own ranks or within the banks, for those failings, and holds them to account?
Guy Opperman
Clearly, it is not possible to comment on specific future events, but Ministers are liable for the actions of civil servants, through vicarious liability, and we would expect regulators to take a similar approach and, putting it simply, to own the problems they are trying to solve. If that is a lesson learned from this sorry saga, in my humble opinion that would be a good thing. Clearly, it is for the FCA to take a good long, hard, look at itself, and other regulatory bodies, and decide how it will run itself going forward, with suitable input from Government.
Neale Hanvey (Kirkcaldy and Cowdenbeath) (Alba)
Will the Minister give way?
Guy Opperman
I will not give way any more. I apologise, but we are trying to do this whole debate in 58 minutes. Please bear with me.
As the House will be aware, on 19 April the Economic Secretary to the Treasury provided a written ministerial statement on the Government’s approach to setting up a compensation scheme for London Capital & Finance bond holders who lost money following the firm’s collapse in 2019. LCF was an FCA authorised firm, which sold unregulated non-transferrable debt securities, commonly known as mini-bonds, to investors. Sadly, 11,600 bond holders lost around £237 million when LCF went into administration. For some investors that will have formed part of an investment portfolio, but for others it will have represented a significant proportion of their savings.
Following LCF’s collapse, the Economic Secretary to the Treasury directed the FCA to launch an independent investigation into its regulation and supervision of LCF. As we have discussed, Dame Elizabeth Gloster led the investigation and concluded that the FCA did not effectively supervise and regulate LCF. The LCF business model was, it is accepted, highly unusual in both its scale and structure. In particular, the firm was authorised by the FCA, despite generating no income from regulated activities. That allowed LCF’s unregulated activity of selling non-transferrable debt securities, known as mini-bonds, to benefit from the impact of being issued by an authorised firm. While other mini-bond firms have failed, LCF is the only mini-bond firm that was authorised by the FCA and sold bonds in order to on-lend to other companies.
In response to the regulatory failings detailed in Dame Elizabeth’s report and the range of interconnected factors that led to losses for bondholders, the Government announced two things: first, they would establish a compensation scheme, and secondly, they would accept all of Dame Elizabeth’s report, as did the FCA. It is, however, important to emphasise that the circumstances surrounding LCF are unique and exceptional, and the Government cannot and should not be expected to stand behind every failed investment firm. That would, with respect, create the wrong incentives for individuals and an unacceptable burden on the taxpayer.
Clause 1 of the Bill, which is the LCF measure, covers two key elements. First, it provides parliamentary authority for the Treasury to incur expenditure in relation to the scheme. Secondly, it makes a minor technical change that disapplies the FCA’s rule-making processes for the purpose of the LCF compensation scheme. The Treasury intends to use part 15A of the Financial Services and Markets Act 2000 to require the Financial Services Compensation Scheme to administer the scheme at speed on the Treasury’s behalf. The scheme will be available to all LCF bondholders who have not already received compensation from the FSCS and represents 80% of the compensation that they would have received had they been eligible for FSCS protection.
Around 97% of LCF bondholders invested less than £85,000 and will not reach the compensation cap under either the Government’s scheme or the FSCS. The Government expect to pay out around £120 million in compensation to around 8,800 bondholders in total and are committed to ensuring that the scheme has made all payments within six months of this Bill securing Royal Assent.
As colleagues will be aware, this is a two-measure Bill, the second clause of which concerns the Department for Work and Pensions and involves loans to the board of the Pension Protection Fund. Clause 2 amends the Pensions Act 2004 by inserting a new section that will give the Secretary of State a power to lend money to the board of the Pension Protection Fund.
The Pension Protection Fund manages the Fraud Compensation Fund, which pays compensation to occupational pension schemes that have lost out financially due to dishonesty. When set up in 2004 by the Blair Government, the PPF and the FCF did not envisage that pension liberation schemes were in scope for FCF payments. This clause will allow compensation to an estimated 8,806 individuals who have been defrauded following the pronouncement of the recent Court judgment in the Dalriada case.
Pension liberation fraud involves members being persuaded to transfer their pension savings from legitimate schemes to fraudulent schemes, with promises of high investment returns or access to a loan from their pension scheme before the age of 55 without incurring a tax charge. The Pensions Regulator has now placed professional pensions trustees in charge of the affected schemes. Those trustees are seeking compensation on behalf of scheme members through the Fraud Compensation Fund.
Following receipt of a significant number of applications, the Pension Protection Fund sought guidance from the High Court in a test case on which schemes should be eligible for the Fraud Compensation Fund. The Court judgment in the case of the Pension Protection Fund vs. Dalriada was pronounced on 6 November 2020, and the High Court concluded that such pension liberation schemes would be eligible, subject to meeting eligibility criteria. The Government have decided to fully accept the Court’s judgment on this and are committed to ensuring that all those who have been victims of pension liberation schemes are able to claim through the Fraud Compensation Fund. However, it is estimated that claims will exceed £350 million, which is far greater than the £26.2 million of assets currently held in the Fraud Compensation Fund, hence the requirement for clause 2 of the Bill and the action that the DWP and the Government are taking.
This is a necessary, urgent and important Bill which will ensure financial protection and fair outcomes for those falling victim in these particular circumstances. My hope and expectation is that the Bill will receive widespread support, and I commend its contents to the House.
Mr Pat McFadden (Wolverhampton South East) (Lab)
I am grateful to the Minister. As he said, the Bill does two things: it enables a Government compensation scheme for the victims of the collapse of London Capital and Finance, and it authorises a Government loan to the Fraud Compensation Fund—part of the Pension Protection Fund—to be paid for through a levy on the pensions industry. Let me take each of those of turn.
I will start with clause 1 on the LCF compensation scheme. The Minister set out the background and I do not need to repeat it in this short debate, but it involves 11,500 investors losing a total of about £237 million. Some £56 million has been paid out by the Financial Services Compensation Scheme to just under 3,000 of those investors, covering those parts of LCF activity that came under the remit of the Financial Conduct Authority’s regulated activities. The Bill aims to compensate the rest up to 80% of the £85,000 FSCS limit, meaning pay-outs of up to £68,000 for those eligible. This is expected to cost the taxpayer about £120 million.
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
Talking about the cost to the taxpayer, I wonder if my right hon. Friend continues to be shocked by the fact that a Member of this House, the hon. Member for Plymouth, Moor View (Johnny Mercer), received over £85,000 from subsidiaries that were mis-selling, like a company in my constituency that defrauded my constituents. That money has never been paid back, but that Member received money from the taxpayer, and actually we should be looking at ourselves—
Mr McFadden
I am grateful to my hon. Friend, and I do think it ill behoves any Member, given the scale of the losses and given the necessity of the Government to bring in this Bill to compensate people for their losses, to profit from this either directly or indirectly. I think that should be clear to all of us.
The Government are legislating on this because of the litany of regulatory failures set out in the report on this issue carried out by Dame Elizabeth Gloster. These failures included failures to respond to repeated warnings from investors and potential investors, LCF repeatedly running promotions implying its products were regulated by the FCA, and failures of communication between different parts of the FCA, all in the end leading to this collapse and financial loss. Had the FCA acted earlier, far fewer people would have invested through this firm, losses would have been lower and the taxpayer would not be faced with the £120 million we are talking about today.
Neale Hanvey
I would like to ask the right hon. Gentleman’s view about a couple in my Kirkcaldy and Cowdenbeath constituency who invested £10,000 each—or £20,000 in total—and did so because the FCA backed the scheme. They feel that the real responsibility lies with FCA and the derogation of its responsibility in ignoring warning signs, while many responsible lenders such as them have lost money they can ill afford to lose. Does he not find it, as I do, a bit rich for the Minister now to say that the Government cannot back every scheme when actually the regulator was at fault in encouraging other people, as he has just said, to invest in that scheme?
Mr McFadden
Many investors did invest because they thought that these mini-bonds were authorised by the FCA, and they were not. A big part of the problem here is having a regulated firm marketing unregulated products. If I am right, the hon. Member’s constituents may be eligible for the compensation authorised by the Bill.
Dame Elizabeth’s report makes it clear how badly the investors were let down by the regulator, and both the Government and the FCA have said that they accept the findings. I have a number of questions that I want to put to the Minister for his wind-up at the end of the debate. First, why is the level of compensation he has chosen 80% of the FSCS level? On what basis was that decision made? Secondly, how will this work practically? I understand that the Government want to avoid the involvement of claims management companies, and that is something I think we would all endorse. How will the Government do that and avoid repeated rounds of claims?
The Bill also gives rise to some important broader questions about policy. The failings identified were serious and substantial, and have to be addressed. The first of those broader questions is: when should compensation paid for by the taxpayer be paid and when not? The Minister quite rightly said that the taxpayer cannot stand behind every investment policy. It would be unfair on taxpayers to expect them to do so, and it would produce perverse incentives. After all, we all know that the value of investments can go down as well as up.
In the case of LCF, it was bonds that were being sold, and the advertising implied a guaranteed pay-out when such pay-outs could not, in practice, be guaranteed. Regulation is not aimed at enabling people to make reasonably informed choices and to understand the risks they are taking. Having made the decision to offer taxpayer-funded compensation in this case, when does the Minister believe it justifiable that the taxpayer should be asked to do that, and when does he not? What was the discussion in the Treasury about how to ring-fence this failure and this company from broader claims for financial compensation? There are calls for compensation quite regularly when investment failures happen. How confident is the Minister that the Treasury will not be subject to legal action from victims of other investment failings?
How confident is the Minister that the FCA can actually make the changes necessary to avoid a repeat of the findings set out in Dame Elizabeth’s report? Callers were phoning the FCA for three years before the company’s collapse. Appendix 6 of Dame Elizabeth’s report states that the FCA received 611 queries from consumers regarding LCF. That is not a random phone call at five o’clock on a Friday that can be missed; it is a pattern of people trying repeatedly to raise red flags and getting nowhere
Individual A said on 15 July 2016:
“This company is doing exactly what the pyramid scams are doing. What they’re doing is they’re paying the money out, the interest out from money which people are paying on the bond… In other words, it’s just a pyramid scam… they’re saying they’ve got charges on their property, security on them, assets on their property, of course they don’t have any assets. It’s all horrendous really, the whole thing”.
There was call after call like that, and they were not acted on. They were not passed up the line, partly because the mini bonds were not regulated. In fact, one caller was told by the FCA call handler that it was not a scam.
There was also the letter from individual financial adviser Neil Liversidge in 2015, three full years before the collapse of the company. He warned that LCF had one customer who was worth—bear with me on the language, Madam Deputy Speaker; I am quoting—
“the square root of bugger all”
and he tried to raise warnings about the practices and health of the company. It appears that that letter was lost.
One of the more damning findings in Dame Elizabeth’s report is that, even if the letter had not been lost,
“It is unlikely that it would have resulted in any, or any substantive, action or re-action by the FCA.”
So little faith did she have in the processes that she appears to have argued that it did not matter that that warning letter had been lost because it would not have been acted on. Imagine if the FCA had acted, in 2015 or 2016, when those reports were received, rather than only at the end of 2018. Another question for the Minister is this: what will the FCA do to improve its handling of reports like this?
Then, there is the so-called halo effect of regulated companies selling unregulated products. Being regulated by the FCA featured heavily in LCF promotions. The financial promotions team at the FCA did warn LCF to dial back on the advertising, but the pattern went on and on, and no one drew the conclusion that this was not just an advertising problem, but a problem with the content of what it was actually selling. Dame Elizabeth states in her report:
“A substantial proportion of the Bondholders said that they would not have invested in LCF had it not been for the fact that it was regulated by the FCA.”
How will the FCA avoid the difference between unregulated activity and regulated companies from being exploited in the future?
The Gloster report was also the subject of a well-publicised disagreement between Andrew Bailey, the Governor of the Bank of England, and Dame Elizabeth, about the nature of responsibility and accountability. Where do the Government stand on this issue? It was all played out before the Treasury Committee in several hearings. Is it the Treasury’s view that senior officials in leading regulatory bodies are responsible for the failing that happen on their watch, or should responsibility apply only to the organisation collectively?
Does the Minister agree with the statement in the report that
“It is difficult to see why an individuals’ willingness to take on challenging tasks in public bodies should absolve them from accountability”?
Or does the Treasury accept the statement from the Parliamentary Commission on Banking Standards quoted in the report that
“A buck that does not stop with an individual...stops nowhere”?
These broader questions matter, because with ever more complex financial markets, the regulators have to be equipped to do the job—equipped through their leadership and their systems, but also through the resources at their disposal. Part of the backdrop to this is the FCA taking on responsibility for tens of thousands more firms after it took on the responsibilities of the Office of Fair Trading back in 2014. Is the Minister confident that it has the resources after the LCF collapse?
Let me turn to clause 2 and the fraud compensation fund. The Bill authorises a loan to be made as a consequence of greater than expected claims on that fund arising from the Dalriada case. It is estimated that the judgment in that case could result in claims of over £300 million. The loan will be funded by a levy on the pensions industry, to be paid back over the next 10 to 15 years. That comes on top of the levy to pay for the Financial Services Compensation Scheme rising sharply since the introduction of the Government’s pension freedom legislation in 2015. Back then, the levy was £300 million; this year, it will be over £1 billion pounds. That is a 48% increase on the previous year and more than triple the level of five years ago. Why does the Minister think the FSCS levy has had to increase so much since the pension freedoms legislation was introduced in 2015? Now we have a new fraud levy to boot.
Surely the right way to tackle this issue is to ask why more and more pensioners are being exposed to fraud and scams in the first place. Why does the Minister think that is happening? Why are more pensioners losing their money? When the previous Chancellor introduced the pension freedoms changes, he said that
“there will be free impartial guidance available to all.”
Six years on, the take-up of that advice is just 3%. Even when the Department for Work and Pensions made a targeted push to increase it, it only got up to 11%, so the vast majority of people using these freedoms are not using that service. Of the small number who take up the option, 72% say they do something different from their first inclination after receiving advice, so it is clear that such advice can help people to make a better decision, yet take-up is nowhere near the promise made at the time.
The promise of pension freedoms being matched with good, trustworthy financial advice has not been kept, and these levies, which will have to be paid by the pension schemes that have been nowhere near fraud and are trying to offer a good service to their members, are being put in place at least in part as a result of the Government’s own pension reforms, which have left more pensioners exposed to fraud and scams. That conclusion was endorsed by the Work and Pensions Committee in its recent report.
What unites both these clauses is people being subject to fraud, often through online advertising. There is a clear need for greater action on this. People are being bombarded on a daily basis with adverts for investments, some of which are scams and attempts at fraud. Financial innovation can be a great thing, but consumers need help in navigating this world, and they are currently being failed by a regulatory system that is lagging behind what is actually happening in the financial markets. There is an online harms Bill coming that, as things stand, does not include plans to crack down on financial crime. I urge the Government to think again on that. To proceed with that Bill without tackling online financial harm would be an enormous lost opportunity to protect consumers against this type of crime.
The answer is not just compensation when people lose money; it is to protect people against financial scams happening before they lose their money, to crack down on the fraudsters while they are peddling their scams and to stop these adverts reaching people in the first place. Not all thieves wear masks. It is possible to rob people of their money through misleading websites and illusory promises of financial gain. It is critical that the laws that we pass in this place keep pace with the innovations in fraud and financial crime that are taking place. For that to happen, it will take a lot more than the two clauses on compensation in this Bill.
Madam Deputy Speaker (Dame Rosie Winterton)
We now go to the Chair of the Treasury Committee, who has four minutes.
Mel Stride (Central Devon) (Con) [V]
This is a very important Bill. It seeks to compensate for some significant wrongs. As part of our ongoing inquiry into London Capital & Finance and the FCA’s response to it, the Treasury Committee has heard many harrowing stories of those who, in many cases, lost life-changing amounts of money as a consequence of what happened.
The Treasury Committee has been involved in the LCF situation for some time. My predecessor, Baroness Morgan, initiated the inquiry by Dame Elizabeth Gloster through approaches by the Committee to the Treasury and the FCA. I take this opportunity to offer my thanks, on behalf of the Committee and of the LCF bond holders, for the very thorough report that she and her team produced, for the witness session she attended as part of our inquiry and for the courtesy and information that she provided to me outside that witness session by way of correspondence and discussions over the telephone.
Dame Elizabeth Gloster carried out some excellent work. As a consequence of her report, the level of the failings on the part of the FCA is very clear. Indeed, the answers to the key questions put by the Government to Dame Elizabeth as part of the directions for her inquiry were clear: the permissions granted to LCF were not appropriate to the business it carried on; the FCA did not adequately supervise LCF’s compliance with the FCA rules and policies; and the FCA’s handling of information from third parties regarding LCF was wholly deficient. The FCA had appropriate rules to regulate the communication of financial promotions by LCF. However, the FCA did not have in place appropriate policies. Numerous red flags were examined by the Committee, but they had been missed over a long period.
There were wider failings within the regulatory system, and we have heard some of those from the shadow Minister, the right hon. Member for Wolverhampton South East (Mr McFadden). The FCA’s approach to the perimeter was limited. It did not take a holistic view of the perimeter and therefore there was inadequate supervision of unregulated activities. The halo effect, which the shadow Minister also raised, was without doubt a wider systemic problem within the FCA.
Our inquiry is ongoing. We have taken evidence from Dame Elizabeth, from senior personnel at the FCA, including Andrew Bailey, who was the chief executive officer of the FCA during the appropriate period, and my hon. Friend the Economic Secretary to the Treasury. We will have much to say in our report, which will be published no later than the end of this month.
Looking ahead, the speakers so far have rightly asked how we make sure that this does not happen again. That lies within the transformation programme that the FCA is now undertaking. The Committee will be showing a close and careful interest in the progress of that transformation programme.
By way of intervention, I note the observation of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) about the importance of those responsible for shortcomings being held accountable. We will no doubt have something to say about that in the report.
The whole issue of compensation leads on to the issue of the general view that there should be personal responsibility for investments, as well as Government backing, and we will need to look at that. I am terribly short of time, so I will leave it there. I welcome the Bill.
Madam Deputy Speaker (Dame Rosie Winterton)
We now go to the SNP spokesperson, Peter Grant, who I am sure will be acutely aware of the very limited amount of time that we have left for the debate.
Peter Grant (Glenrothes) (SNP) [V]
I am pleased to be able to speak in this short debate and to confirm that the SNP will not oppose Second Reading, but I am angry and frustrated that the debate needs to take place at all. Most parts of the legislation are only necessary because of a catalogue of failures of Government, of legislation and of regulators.
I will speak first about the second of the two parts, on the Pension Protection Fund. One of the first times I spoke in Parliament, just a few days after my maiden speech, I expressed concerns about pension liberation scams. I asked the then Secretary of State what steps the Government were taking to protect people from them, to make sure changing the rules would not just make open season for the scammers. We now know that the answer to that question is that the Government were doing nothing, or if they were doing anything, they did not do nearly enough. Some £350 million has been stolen from people’s pensions using these scams. Those pensioners should be compensated from the Pension Protection Fund, and I would support a provision in clause 2 to allow that to happen.
Clause 1 sets up the promised compensation scheme for victims of the London Capital & Finance scandal. About 11,000 people were affected, of whom 2,000 got some compensation and 9,000 got nothing. I do not think any of the 11,000 understand why some qualified for compensation and some did not. It is very welcome that the Bill will provide some redress for the 9,000 or so bondholders who would have otherwise got nothing. It is welcome, but it is not enough.
The House of Commons Library has described the Government’s decision to set up the compensation scheme as “a somewhat exceptional response.” The response is exceptional, but the scandal to which it responds is anything but. It is the latest, and sadly almost certainly not the last, in a roll of shame that includes Equitable Life, Premier FX, Connaught, Henley pensions, Blackmore Bond and many others. The victims of some of these schemes get compensation, but tens of thousands get nothing.
Blackmore Bond, for example, went into administration in May 2020 and its bondholders are unlikely to see any of the £46 million investment that the company’s directors had promised them was safe and guaranteed. One of my constituents lost his £40,000 life savings to Blackmore Bond. I have to disagree with the Minister’s claim that LCF was unique or even distinctive in any material way from Blackmore Bond and various other mini-bond failures. LCF hid behind its own FCA registration knowing that it had nothing to do with the products it was selling. Blackmore Bond hid behind the FCA registration of other companies that acted as its representatives. The intention in all cases was clear: to mislead investors as to the degree of protection that the Financial Conduct Authority would give them, when in most cases the companies knew that the FCA would give no protection whatever.
Like LCF, Blackmore Bond could have been stopped much sooner if the Financial Conduct Authority had acted on the warnings it was receiving as long ago as early 2017. One came from an eyewitness who offered to let the FCA into his office to watch and listen at first hand to the “unlawful” telephone sales practices that the company’s representatives, Amyma Ltd, were using—his words, not mine. It took two and a half years for the FCA to remove Amyma’s right to act as authorised representatives. Several months later, again as part of its response to the collapse of LCF, the FCA banned the sale of mini-bonds to small retail investors. Some £26 million of the total investor losses in Blackmore Bond were from bonds sold after March 2017—after the Financial Conduct Authority had enough information to take decisive action, but before it had taken the action that was needed.
I want to see legislation, or possibly even an amendment to this Bill, that makes schemes similar to the LCF compensation scheme available to victims of other pension and investment scams without them having to wait for a public inquiry and a new Act of Parliament for every single one. I want to see the Government getting serious about dealing with the shysters and charlatans who too often seem to walk away unscathed from these scandals, or more likely get driven away in their chauffeur-driven luxury cars, leaving their victims in many cases almost destitute. I want to see a regulatory regime that works, not just to compensate the victims at public expense, but to stop the crooks and chancers from being able to con people out of their money in the first place.
The fact that the Minister admitted in his opening speech that paying compensation to all victims of pension or investment scams would place an unacceptable burden on the public finances is one of the biggest admissions of regulatory failure by any Government Minister that I can ever remember. While we welcome the steps taken in the Bill, the message very clearly from the Scottish National party, as it was from the Labour Front-Bench spokesman a few minutes ago, is that this is not even enough to be the start of the action needed to make people’s pensions and investments safe from the crooks.
James Grundy (Leigh) (Con)
I thank the Minister and the Economic Secretary to the Treasury for bringing this Bill to the House. I welcome this Second Reading debate and am pleased that the Government are making tangible progress. I also thank Dame Gloster for her report and welcome the fact that the Government have accepted its nine recommendations. My contribution will be brief and I hope that, given the time constraints, Members will forgive me for not taking interventions.
Will my hon. Friend the Economic Secretary clarify whether bondholders will be required to surrender all their bonds to qualify for the Government’s scheme? If that is the case, some of my constituents who invested considerable sums in the scheme will be forced to surrender all their bonds, regardless of the amount invested, to receive the maximum £68,000 of compensation offered by the Government, as opposed to their being able to surrender a portion of their bonds to gain access to the Government’s compensation scheme while still potentially being able to receive further dividend payments direct from the administrators, thereby ensuring that their loss is reduced. My constituents need clarity and it would be most welcome if the Department would consider that. I recently wrote to my hon. Friend about this matter and very much look forward to hearing his response.
John McDonnell (Hayes and Harlington) (Lab) [V]
The Bill will bring relief to thousands of investors who were let down not just by a failed company but by a failed system. That is why we need a Bill that will address the failures of regulation, governance and auditing, but this Bill does none of that. The Government are yet again bailing out victims of an under-regulated finance system that is regularly ripping off smaller investors. I have to say that Government Ministers are guilty of gross negligence for standing by while this happens time and again.
LCF was offering customers mini-bonds. The FCA said:
“There is no legal definition of a ‘mini-bond’”,
but it did nothing to stop the mis-selling. The FCA saw no issue with LCF’s operations, yet in March 2019 HMRC found that products advertised as ISAs by LCF did not meet the rules. In addition, the FCA was advising that investments would be protected by the financial services compensation scheme; the High Court judged that they were not. The FCA was asleep at the wheel.
The then chief executive of the FCA, who is now the Governor of the Bank of England, sat on his haunches and did nothing. Some 18 months ago, I called on the previous Chancellor, the right hon. Member for Bromsgrove (Sajid Javid), to delay Mr Bailey’s appointment as Governor, given the concerns.
I am pleased that the Dame Elizabeth Gloster’s report actually identifies some of the problems. She described the FCA’s supervision of LCF as “wholly deficient” and said that there were “significant gaps and weaknesses” in the FCA’s practices. She said that staff were
“not…trained sufficiently to analyse a firm’s financial information to detect indicators of fraud or other serious irregularity.”
LCF’s founder was Simon Hume-Kendall, a former chairman of the Tunbridge Wells Conservatives and a party donor. It has been reported that the investors’ cash in LCF has been used to buy horses, a helicopter and lifetime memberships to private Mayfair clubs. Perhaps the Minister could update us on the ongoing inquiries into the activities of this gentleman and LCF.
As has been said, this is not a one-off. There are so many other examples, including Blackmore, Basset & Gold and Chilango. Perhaps the Minister can tell us when further Bills will be introduced to compensate the investors in those schemes who lost so much money. I welcome the Bill—of course I do—but it is now time for the Government to bring forward serious legislation to stop crimes like this happening in the first place and to protect our constituents from these spivs.
Sammy Wilson (East Antrim) (DUP) [V]
I welcome the Bill. Those of my constituents who have been affected by the collapse of LCF will welcome the fact that, as a result of the excellent report by Dame Elizabeth, which really lifted the lid on how the Financial Conduct Authority failed in its obligations, the Government have been forced into the position we are in today with this Bill. I welcome that.
As other speakers have said, this is not the first time that the Financial Conduct Authority has failed in its regulatory duty and failed people who are innocents in all of this. Firms assure them that they are regulated and that protection is available, but the savings they invest are then snatched from them. Let us look at the failure of the FCA in this particular case. It failed to meet its statutory obligations. It failed to take any action even when it was found that a regulated firm was engaging solely in unregulated lending. Surely that must have raised concerns that the firm was using its regulated status to engage in activities that were unregulated. Its staff were clearly not trained in taking complaints and passing them on. Indeed, as Dame Elizabeth pointed out, they were actually assuring the public that the claims being made by LCF were correct and that their savings were safe. Even when fraud was passed on up the line to supervisors, again it was ignored. All these regulatory failures require the Government to ensure that there is compensation for individuals.
I agree with the Minister that we cannot cover every spiv and every chancer who tries to take money from people. If we are going to avoid that, we must have proper regulations. If the Financial Conduct Authority has proven that it is not up to the job, new regulators have to be put in place. Those who take on the responsibilities of the Financial Conduct Authority have to be held responsible as well. We cannot simply say that it is about the institution or the people who are in charge; we have to avoid this happening again so that people in my constituency who have suffered do not continue to suffer from these kinds of actions.
Rebecca Long Bailey (Salford and Eccles) (Lab) [V]
My constituents were not professional financial investors; most were senior citizens relying on the investment for their pension. They worked hard in their younger years to save a little bit here, a little bit there, to ensure that in their twilight years they would have enough to live on—but this security was savagely snatched away from them. They were duped by grossly misleading and deceitful marketing and let down by negligent regulators and ineffective auditors.
Although I am broadly supportive of the Bill, there are two very urgent issues that the Government must address. First, the compensation is capped at 80% of what victims would have been entitled to had they been eligible for the financial services compensation scheme. They were denied that protection simply because mini-bonds were not regulated. The Gloster report states:
“The FCA had identified the risks to consumers posed by mini-bonds from as early as 2013 and the additional risks relating to the use of mini-bonds as a quasi-investment vehicle by at least 2017.”
Yet the FCA and the Government failed to regulate. The Government must therefore recognise their own negligence to regulate, as well as the FCA’s, and commit today to offer the full compensation that victims should have been entitled to.
Secondly, on auditing, London Capital & Finance had only £50,000 of share capital and high leverage in 2016, but its auditors simply waved through its accounts. In 2018, when the firm was all but insolvent, its auditors, astoundingly, had no problem with its accounts. But sadly, as we know, this is not a rare occurrence. BHS, Carillion, Thomas Cook, Patisserie Valerie and many more all sailed through their audits with flying colours despite the horrors lurking beneath. Such scandals required robust action to ensure that they could never happen again, but this Bill does not do that. The Government must therefore set out urgent proposals to address the systemic regulatory failures that this case has exposed in the FCA but also in the auditing industry.
Gareth Thomas (Harrow West) (Lab/Co-op)
I rise to support the Bill, but to suggest that there are wider issues to be considered from the scandal behind it. In particular, I suggest that there are disturbing echoes of Dame Elizabeth Gloster’s report in how the demutualisation of Liverpool Victoria is being considered by the same regulators, and that there is an urgent need to tighten up some major legal loopholes.
The focus of the Financial Conduct Authority’s interest to date in LCF and Liverpool Victoria is very different. LCF was selling, or rather mis-selling, a distinct product. With Liverpool Victoria, the issue is whether it should be allowed to hand over all the capital and assets its British customers have helped it build up over almost 200 years to a privately owned American firm with no commensurate experience, and whether the choices of consumers past and present are being respected. I understand that regulators have had a substantial number of meetings with those pushing the demutualisation, but none with the customers and owners of Liverpool Victoria.
Consumers lost thousands with London Capital & Finance. The customers of Liverpool Victoria also risk losing out significantly. Dame Elizabeth’s report questioned whether policy papers and staff training at the FCA were adequate. In the case of LCF, the inability to detect indicators of fraud was the key driver of her concern, but given that the FCA has made no analysis of what happened during previous demutualisations of financial services businesses—whether customers benefited or lost out; whether customers were presented with fair information and given access to alternative viewpoints—it is difficult to see how staff could be trained to protect the consumer interest properly during a demutualisation. Indeed, all the evidence that has been compiled independently suggests that demutualisations result in worse services for consumers.
It is clear that Dame Elizabeth thought that the FCA was not fit for purpose. It did not protect LCF customers, despite repeated wake-up calls. Similarly, given the complicated nature of financial services businesses, the customers of a financial mutual are not always well placed to make a judgment about whether a vote for a conversion is in their interest; they rely on the advice of others. Customers are not given even-handed information by boards wanting to demutualise—they are certainly not in the case of Liverpool Victoria—to allow them to make an informed decision. The FCA has a critical role, and it needs to exercise a little more robust direction to the board of Liverpool Victoria. Similarly, legislation for friendly societies needs updating so that it properly protects consumers’ assets and ensures that regulators can properly protect consumers during demutualisations.
Jim Shannon (Strangford) (DUP)
I, too, welcome the Bill and very much look forward to its moving forward. Having read the background information and looked back on what happened, I have a couple of questions, although I support the Bill and think it is important that we do so.
The FCA found in the case of London Capital & Finance that it had been
“misleading, not fair and unclear”
in its advertising, and that there had been
“serious concerns about the way the firm was conducting its business”.
For me, it is clear that the FCA at that time failed the investors. At the same time, Dame Elizabeth’s report concluded that
“the FCA did not discharge its functions in respect of LCF in a manner which enabled it effectively to fulfil its statutory objectives.”
We are where we are tonight, and we have a Bill that I hope will address those issues for this particular group of investors. I just ask the Minister whether—the hon. Member for Harrow West (Gareth Thomas) referred to this—in other cases where people have invested similarly and indiscretions and fraud have taken place, they too will be able to benefit from this legislation.
I welcome clause 2, which will give the Secretary of State the power to make a loan to the board of the PPF to enable the payment of compensation to eligible occupational pension schemes following the High Court judgment. That is an essential component of the legislation, as is the fact that it entails the loan being repaid by the fraud compensation fund levy over a period currently estimated to be between 10 and 15 years. We must protect, if we can, the pension schemes and investors through that process and give them peace of mind. The protection of those pensioners is increasingly important to me, as it is to every hon. Member who has spoken in the debate and to the Minister.
I will pose one last question to the Minister, if I may, about those investors who may have passed away without being able to take advantage of this legislation. Will the families of the deceased—those who are no longer here —qualify for the compensation as well?
The Economic Secretary to the Treasury (John Glen)
It is a great honour to speak in this debate and to have worked with the pensions Minister—the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham (Guy Opperman)—to bring forward this legislation. Many Members of this House, if not all, will have constituents who have been affected by the issues that we have dealt with and discussed this afternoon.
I am pleased that the Bill has the support of Members across the House. I have listened carefully to the debate. Observations have been made about the FCA and about the House’s confidence in its conduct; I will seek to address those points and to respond to the important points raised by several hon. Members about the compensation scheme for London Capital & Finance.
Let me begin with the scope of the compensation scheme and what it means in relation to the Government’s approach to future firm failures—a point that the right hon. Member for Hayes and Harlington (John McDonnell) and others raised. The LCF is not the only mini-bond firm that has failed in recent years. The Treasury, in collaboration with the FCA, has examined every mini-bond issuer known to have failed in the past eight years. Following that detailed analysis, the Government are satisfied that the circumstances surrounding LCF are truly exceptional.
As hon. Members may already be aware, the issuance of mini-bonds is not regulated by the FCA. As my hon. Friend the pensions Minister set out, LCF was an FCA-authorised firm despite not receiving any income from regulated activities. LCF is unique in that regard; indeed, it is the only mini-bond issuer that was authorised by the FCA and that sold bonds to on-lend to other companies. That is important, because one of the central findings in Dame Elizabeth Gloster’s excellent report is that because LCF was authorised, the FCA should have considered its business holistically, including the unregulated activity of issuing mini-bonds. The FCA cannot be said to have the same responsibilities with regard to unauthorised firms. Although the Government have not seen evidence to suggest that the regulatory failings at the FCA caused the losses for bondholders, they were a major factor that the Government considered when deciding to establish the scheme.
I pause to acknowledge the representations made by the hon. Members for Strangford (Jim Shannon) and for Kirkcaldy and Cowdenbeath (Neale Hanvey) and by my hon. Friend the Member for Leigh (James Grundy). I will set out in due course, in the coming months, the details of how the scheme will operate. I am very happy to take correspondence on individual cases, but I think it would be inappropriate to try to address at the Dispatch Box this evening every single case raised. However, I have received and read many letters from individuals who have lost money after investing in LCF and other failed mini-bond firms, including Blackmore Bond and Basset & Gold, which were raised in the debate.
I sincerely extend my sympathy to all those affected, as I know that many individuals have suffered financial hardship—severe financial hardship, in many cases—as a result of their investment losses. However, I must be clear that the Government cannot step in to pay compensation in respect of every failed financial services firm. That falls outside the financial services compensation scheme, would create a moral hazard for investors and would potentially lead individuals to choose unsuitable investments, thinking that the Government would provide compensation in all cases if things went wrong.
The Government’s approach follows the historical precedent. I note that only three compensation schemes have been established in the past 35 years—for Barlow Clowes, a Ponzi scheme that failed in the late 1980s, Equitable Life and LCF—despite many investment firms failing over that period. The Government are also seeking to ensure that the situation never arises in the future. In April, we launched a consultation with proposals to bring mini-bonds into FCA regulation.
The right hon. Member for Wolverhampton South East (Mr McFadden) asked a number of questions about the Government’s confidence about the FCA’s capability. As the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham mentioned, the transformation programme that the new chief executive, who has been in post for just over eight months, is undertaking at pace is designed to empower the organisation at all levels to hear the representations that the right hon. Member for Wolverhampton South East made, to act on them, and to deal proactively with the cases that are raised.
Gareth Thomas
It is encouraging to hear the Minister’s confidence in the transformation programme. Given the concerns that consumers might lose out in the demutualisation of Liverpool Victoria, will he sit down with the new chief executive of the FCA and go through how the FCA will ensure that consumers’ interests are properly protected if that demutualisation goes ahead?
John Glen
I thank the hon. Gentleman, as ever, for his representations. He has been a determined campaigner for that sector during my tenure. I have regular conversations, at least every six weeks, with the chief executive of the FCA, and we discuss a whole range of matters. I would be very happy to discuss that matter with him when I next speak to him in the next few weeks.
As Members from across the House have recognised today, the measure concerning a loan to the board of the Pension Protection Fund, set out in clause 2, is vital to ensure that those defrauded of their pensions by scam pension liberation schemes are able to access the compensation that they deserve. The Bill will ensure that those whose pensions have been unjustly targeted by fraudsters receive their pensions. We must continue to provide a safety net for people across the UK, who deserve to have confidence that they will have a pension pot for their retirement. I note that a number of observations were made about the ongoing challenge of dealing with the evolving nature of financial services firms and the sophistication of scams. The Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham, and I are working across Whitehall to bring an effective resolution to this matter.
I acknowledge that Members from across the House have supported the principles of the Bill, and I welcome the support that it has received. It will offer some relief to the enormous distress and hardship suffered by LCF bondholders and victims of fraudulent pension liberation schemes. It is an important Bill, and I want to move as quickly as possible from Royal Assent to enact it and deliver that compensation. I hope that right hon. and hon. Members will support it this evening.
Question put and agreed to.
Bill accordingly read a Second time.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (Programme)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill:
Committal
The Bill shall be committed to a Public Bill Committee.
Proceedings in Public Bill Committee
(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 17 June.
(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.
Proceedings on Consideration and Third Reading
(4) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings on Consideration are commenced.
(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.
Other proceedings
(7) Any other proceedings on the Bill may be programmed.—(Alan Mak.)
Question agreed to.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (money)
Queen’s recommendation signified.
Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),
That, for the purposes of any Act resulting from the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill, it is expedient to authorise the payment out of money provided by Parliament of:
(a) expenditure incurred by the Treasury for, or in connection with, the payment of compensation to customers of London Capital & Finance plc; and
(b) loans by the Secretary of State to the Board of the Pension Protection Fund.—(Alan Mak.)
Question agreed to.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (ways and means)
Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),
That, for the purposes of any Act resulting from the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill, it is expedient to authorise such levying of charges under section 189 of the Pensions Act 2004 and Article 171 of the Pensions (Northern Ireland) Order 2005 as may arise by virtue of that Act.—(Alan Mak.)
Question agreed to.
Madam Deputy Speaker (Dame Rosie Winterton)
I will now suspend the House for two minutes to make the necessary arrangements for the next business.
House of Commons Commission (External Members)
(3 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
The Leader of the House of Commons (Mr Jacob Rees- Mogg)
I beg to move,
That, in pursuance of section 1(2B) of the House of Commons (Administration) Act 1978, as amended, Louise Wilson be appointed to the House of Commons Commission for a period of three years with immediate effect; and Shrinivas Honap be appointed to the House of Commons Commission for a period of three years commencing on 1 October 2021.
Before turning to today’s motion, I am sure that the House will want to join me in thanking Jane McCall, who served as an external member on the Commission for over five years and finished her time in post at the end of April. In addition, Rima Makarem’s three-year term will end on 30 September, and, owing to other commitments, she has given notice that she will not be seeking an extension to her appointment. Having served alongside both of them on the Commission, I am most grateful for their contribution and the valuable external perspective and commitment that they brought to their roles. They always had a particular interest in value for money, which is one of the things that we should take most seriously in the House as guardians of taxpayers’ money. I am grateful for what they have done and wish them well in their future endeavours.
Today’s motion gives the House the opportunity to agree two new external members of the Commission. In February, the Commission endorsed the recruitment process to appoint new external members. The full details of that process are set out in the Commission’s report on the nomination of candidates for its external members, HC 223, which has been tagged to today’s debate.
In March, a sifting panel, consisting of the then shadow Leader of the House, the right hon. Member for Walsall South (Valerie Vaz), the Clerk of the House and the secretary to the Commission, Marianne Cwynarski CBE, shortlisted four candidates for interview by the selection panel. The selection panel comprised Mr Speaker, me, the right hon. Member for Walsall South, Isabel Doverty, who is a former civil service commissioner, the Clerk of the House and the secretary to the Commission. Interviews took place in April.
Following that process, the selection panel recommended to the Commission that Louise Wilson and Shrinivas Honap be nominated as its new external members, with Louise replacing Jane McCall and, in due course, Shrinivas replacing Rima Makarem. Should the House agree to these appointments, it is expected that both will also serve on the Audit and Risk Assurance Committee and that Shrinivas will replace Rima Makarem as chairman of that committee.
As the Commission’s report sets out, Louise Wilson is a business leader with an international career combining commercial expertise with extensive non-executive experience in the public, private and charitable sectors. She established her career at Accenture and gained global marketing and commercial expertise at Procter and Gamble, PepsiCo and The Coca-Cola Company—she is very fizzy, I should think, with all that experience at those drinks companies. She founded an international marketing and sponsorship company and, following London’s successful bid, served as the client services director of the 2012 London Olympic and Paralympic games. She has previously undertaken non-executive roles across a range of business and charitable organisations spanning education, heritage, culture, visitor attractions, faith and diversity. These have included roles at Historic Royal Palaces, the University of Nottingham, the David Ross Education Trust, the International Women’s Forum, the Harvard Vatican Leadership Trust, the Marketing Group of Great Britain, the Queen’s Commonwealth Trust and, currently, the Northern Ireland Office and the National Emergencies Trust.
Shrinivas Honap is a chartered accountant by profession and served with Vodafone, Capita, KPMG and Egg during his executive career. He currently holds a number of non-executive roles, including as chairman at the Driver and Vehicle Standards Agency, non-executive director and chair of the Audit Committee at UK Atomic Energy Authority and at the Rural Payments Agency. He has recently been appointed to the Civil Service Pension Board and also serves as a lay member on the Speaker’s Committee for the Independent Parliamentary Standards Authority and a panel member at the Competition and Markets Authority and on the Pensions Determination Panel.
The Commission believes that both candidates bring a diverse range and depth of experience and that this will hugely benefit the work of the Commission in the coming years. As a member of the Commission who interviewed them, I add my own very strong personal recommendation. We interviewed two exceptionally strong candidates and the House is very fortunate that they put their names forward and are willing to serve. As such, the House of Commons Commission—I am, in bringing this motion, acting for the Commission—recommends that the House appoints both candidates as external members, each for an initial period of three years. I hope that the House will agree to their appointments today and I commend this motion to the House.
Thangam Debbonaire (Bristol West) (Lab)
I thank the Leader of the House for introducing the motion. On behalf of Her Majesty’s Opposition, may I warmly welcome the two new external Members of the House of Commons Commission? I have had the pleasure of meeting one already—Louise Wilson. She impressed me greatly. I also read carefully the reports that the Leader of the House has made reference to, with details of the recruitment process. From my so far limited experience of the Commission, I would say that this appears to have been done in a fair and thorough manner. I look forward to meeting the second external commissioner in due course.
I know that we are going to move on subsequent motions without debate, so I would like to place on record my thanks to my hon. Friend the Member for Nottingham South (Lilian Greenwood) for her service on the Parliamentary Works Estimates Commission as well as to welcome, obviously, my right hon. Friend the Member for Newcastle upon Tyne East (Mr Brown) to that post.
To finish, I would like to strongly recommend, from what I have seen and the evidence that I have heard and read, Louise Wilson and Shrinivas Honap to the House of Commons Commission as external commissioners.
Pete Wishart (Perth and North Perthshire) (SNP)
I thank the Leader of the House for moving this motion this evening. May I apologise to you, Madam Deputy Speaker, to Mr Speaker and to the House for not being in my regular place at business questions on a Thursday morning? It is not because I do not want to be here; it is because I also chair the Scottish Affairs Committee, which meets just now on a Thursday morning, and the Conservative members have resolutely refused to move the time of that Committee. I hope to get that resolved as soon as possible.
I know that the Leader of the House always says that there is not a Conservative majority on the Scottish Affairs Committee, which is entirely right, but how we try to work in this House, as you know, Madam Deputy, is through consensus, engagement and working together, so that we can reach an outcome that is positive for everybody. Once again, I appeal to the Leader of the House to make representations to his colleagues, so I can get back here again, because I know that he enjoys a joust with me on a Thursday morning.
I have not had the opportunity to welcome the hon. Member for Bristol West (Thangam Debbonaire) to her post, because I have not been here on a Thursday morning, so I would like to welcome her now. I also never had the opportunity to pay tribute to the right hon. Member for Walsall South (Valerie Vaz)—the three of us served so many years together—and I just wanted to put that on record. I am sure that you will forgive me for that, Madam Deputy Speaker.
I also want to welcome Louise Wilson. This is a fantastic appointment, and I very much look forward to working with her on the Commission. I had the pleasure of meeting Louise just a few weeks ago. She was as effervescent as The Coca-Cola Company with which she worked with such distinction for all those years. Her experience of the London Olympics will serve her well as we negotiate with the Sponsor Body on the ongoing agonising over restoration and renewal. It has been said that Louise is highly experienced with an extensive track record in business and public service.
I have not had the opportunity to meet Shrinivas Honap. I look forward to meeting him. I totally support what the Leader of the House has said about his background and experience. He does seem to be ideally placed to join us in the House of Commons Commission and I look forward to meeting him in time.
I pay tribute to Jane McCall and Rima Makarem. I got to know both of them, as you did, Madam Deputy Speaker, after all these years in service to the Commission. It is worth noting that we all enjoyed working with them. They brought something special to the deliberations of the Commission, and I wish them well for the future. We have to pay tribute to our external members of the House of Commons Commission. They offer a different perspective from the perhaps institutionalised view that we have as Members of Parliament, and it is worth noting what they bring to the workings of the Commission. We look forward to doing all that as we go forward.
We are, quite rightly, not going to get an opportunity to discuss the appointments to the other bodies. I also welcome the right hon. Member for Newcastle upon Tyne East (Mr Brown). It is not often that someone can be a Chief Whip under three different Governments and still be popular and liked across the House, but he manages to do that with aplomb and I wish him well. I also want to pay tribute to the hon. Member for Nottingham South (Lilian Greenwood). She did a great job in her other roles and I look forward to working with her. And hopefully, Madam Deputy Speaker, I can get to business questions—help me out, Leader of the House so that I can be here.
John Spellar (Warley) (Lab)
I am mindful of the concerns of colleagues that they do not want to be delayed for too long. I have no animus against, or indeed any knowledge of, either of the two individuals being appointed, and they may well fit the glowing descriptions that we have heard. I certainly hope so, and no doubt the Leader of the House will be pleased to sit alongside them as well, but I have huge problems with the process. What seems to have happened here, as so often—in fact, almost invariably—with our selection processes, is that we determine and narrow the outcome by the criteria that we use. It is like any algorithm: if we set the criteria for it, it will predict the outcome that we are going to get.
So let us look at the criteria. They include the need for:
“Senior executive leadership experience within a complex organisation”.
Already we are saying, basically, that we want the corporate suits. Male or female, it is the corporate suits we want, not people who have gone out and created and run a business themselves; not people who have actually worked in industry or maybe run a factory and really know about running things; not trade unionists who have had to engage with complex issues; not people who have worked in hospitals—not in senior management but maybe running a ward; and not those who are running a school. Those people do not get considered.
Every time we have a list of nominations, it nearly always consists of those who have been in big corporates and who have then sat on the boards of quangos and charities. It is always the great and the good. We keep appointing them time and time again, then we are surprised that this country ends up being so badly run. Basically, we are drawing from a very narrow cast, and we are constantly enabling them to perpetuate themselves —and not only them as individuals and their narrow range of experience, but their general ethos and that narrow self-perpetuating culture, which I am surprised, frankly, that the Leader of the House so readily accepts.
I have another problem with this. Paragraph 14 of the report from the Commission to the House says:
“In the case of both candidates, the selection panel was satisfied that neither had undertaken any political activity within the last five years”.
I am absolutely fed up with this assumption—again from this self-perpetuating elite that I have described—that party political activity is somehow reprehensible, shabby and shoddy, and that it is only those who will not engage in politics who are fit to be engaged in running public life. That is detrimental both to politics and to public life. I will continue to raise this issue on all such occasions when this same rotten process occurs, because, as we have seen many times, the public see through this arrogant metropolitan intellectual and cultural elite and the way they are running this country. But yet again, all the time, we are playing our part in perpetuating its malign grip. As I have said, I have no animus against the individuals concerned, but I have huge objections to the process.
Mr Rees-Mogg
Before I reply to the right hon. Member for Warley (John Spellar), may I pay tribute to a most distinguished member of the Commission who has stood down? If I may say so, Madam Deputy Speaker, you have been a great person to work with on the Commission—always sensible, moderate and seeking consensus, and not using it for party political purposes. Of course, you are no longer party political in these roles, and what fun it was being on the Commission with you. I record our gratitude for the bacon sandwiches, which were particularly appreciated and were, I think, thanks to your lobbying. I thank the shadow Leader of the House and the hon. Member for Perth and North Perthshire (Pete Wishart) for their contributions and support. I note the hon. Gentleman’s comments about Thursday mornings, but sometimes in this place a vote is necessary to get what one wants, and it may be that that is what he needs to do.
On the important points raised by the right hon. Member for Warley, I am not keen on the metropolitan elite any more than he is. I tend to think that they have a set of views that are not particularly my views, or those of my constituents in rural Somerset, so I think his criticisms need to be considered carefully. First, senior executive leadership does not exclude trade unionists or people who have worked in the public sector, and there are senior leadership and executive roles in bodies that are not big business. Indeed, the House has taken people who have not been involved with big business but have been involved in the public sector, and trade unionists would be welcome to apply. They obviously run complex organisations, and the suggestion that they would be excluded is unfair. It is obviously right that the House expects people to have been senior in whatever they have done, whether that is an entrepreneur, a headmaster or headmistress, someone who has run a hospital, a trade union leader, or somebody who has worked for a big company such as Coca-Cola, and that is a broad category to have.
On the question of politics, we have debated this issue before, and I agree with the right hon. Gentleman that being involved in politics is something one should wear as a badge of honour. It is part of being involved in civic society, and that applies to all parties, not just to those in one of the major parties, and not even if someone is just a good Tory, like me. Whatever, party someone belongs to, they are contributing to society. But—there is inevitably a but—on the Commission, the politics is provided by Members of the House, and there is no point trying to change the balance of the Commission from the balance in the House by appointing outsiders who are political. It is simply a question of appropriateness for the role that they are to fulfil within this House. I think that is fair. Members of the House can be party political if they want to on the Commission, although it tends to work well by consensus, but to appoint external politicians would, I think, border on the eccentric. I have great confidence in the two people we have chosen today, who I think will be a real pleasure to work with.
John Spellar
I would understand if the right hon. Gentleman were arguing, for example, that a political leader of a council might change the balance of the Commission, but if we are trying to get expertise, they would also be used to running large organisations. He rightly said that the Commission tends to work with a degree of consensus; it is not divided. Many other countries managed to encapsulate that. They appoint people to public bodies in the full and public knowledge that they have been politically active. I still do not understand why the right hon. Gentleman thinks that should be a major debarring factor.
Mr Rees-Mogg
As I hope I was making clear, I think it debars from the Commission, where politicians are already appointed. It inevitably does not debar from other public sector appointments, where that may be perfectly reasonable, and where people may be appointed because of their connection to a political party if we are seeking a political balance. As I said, I have particular confidence in the two people we are appointing today. I think they will be first class and make a considerable contribution to the Commission and the work of this House.
Madam Deputy Speaker (Dame Rosie Winterton)
I thank the Leader of the House for his kind words. It was a great pleasure to be on the Commission, and very enjoyable working with all those who served on it.
Question put and agreed to.
Parliamentary Works Estimates Commission
Resolved,
That Lilian Greenwood be discharged as a member of the Parliamentary Works Estimates Commission and Mr Nicholas Brown be confirmed as a member under Schedule 3 to the Parliamentary Buildings (Restoration and Renewal) Act 2019.—(Tom Pursglove.)
Speaker’s Committee for the Independent Parliamentary Standards Authority
Resolved,
That Thangam Debbonaire be appointed to the Speaker’s Committee for the Independent Parliamentary Standards Authority in place of Valerie Vaz, until the end of the present Parliament, in pursuance of paragraph 1(d) of Schedule 3 to the Parliamentary Standards Act 2009, as amended.—(Tom Pursglove.)
House of Commons Members’ Fund
Resolved,
That Sir Alan Campbell be removed as a Trustee of the House of Commons Members’ Fund and Mr Nicholas Brown and Craig Whittaker be appointed as Trustees in pursuance of section 2 of the House of Commons Members’ Fund Act 2016.—(Tom Pursglove.)
Business without Debate
John Spellar (Warley) (Lab)
Object. Will I be right, Madam Deputy Speaker, that the Division will therefore be deferred?
Madam Deputy Speaker (Dame Rosie Winterton)
The right hon. Gentleman is saying no; the Division will be deferred until tomorrow.
John Spellar
The Information Commissioner is doing a lousy job and £200,000 is far too much.
The Deputy Speaker’s opinion as to the decision of the Question being challenged, the Division was deferred until Wednesday 9 June (Standing Order No. 41A).
Justice Committee
Ordered,
That John Howell be discharged from the Justice Committee and Laura Farris be added.—(Mike Freer, on behalf of the Committee of Selection.)
Women and Equalities Committee
Ordered.
That Ben Bradley and Peter Gibson be discharged from the Women and Equalities Committee and Lee Anderson and Philip Davies be added.—(Mike Freer, on behalf of the Committee of Selection.)
Kettering General Hospital
(3 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Mr Philip Hollobone (Kettering) (Con)
What a joy it is to see you in the Chair, Madam Deputy Speaker; thank you for staying for the Adjournment. I thank Mr Speaker for granting me this debate and welcome the Minister to his place. I also welcome my hon. Friend the Member for Corby (Tom Pursglove), who is a superb representative for his constituents, but who unfortunately, as he holds the high office of the Government Whip, is not allowed to speak in this place. I also thank all the staff at Kettering General Hospital, in particular Simon Weldon, the superb group chief executive, and Polly Grimmett, the director of strategy.
I thank the Minister for the personal interest that he has shown over a long period in Kettering General Hospital. He visited the hospital on 7 October 2019. He responded to an Adjournment debate on the hospital on 23 October 2019, when he announced £46 million of new funding for the proposed urgent care hub, and on 3 February this year he met with the hospital and my hon. Friends the Members for Wellingborough (Mr Bone) —who I welcome to his place—and for Corby. I would also like to thank the Prime Minister, who spent five hours on a night shift at Kettering General Hospital in February 2020.
I welcome the Government’s unprecedented investment in the NHS and their commitment to the hospital building programme, which has resulted in promised commitments to the hospital of £46 million for a new on-site urgent care hub, £350 million in health infrastructure plan 2 funding for 2025 to 2030, and a write-off last year of £167 million of trust debt at the hospital. However, promises are one thing and delivery is another. The problem that the hospital faces is that these two funding streams from the Government—£46 million for the urgent care hub and £350 million for the phased rebuild—are not being meshed together by the Health Department and HM Treasury. The danger is that, as a result, the promised investment in the hospital faces potentially serious delays.
The dilemma is this: if the hospital proceeds with the £46 million urgent care hub build as a stand-alone project, there will not be room on the site for the HIP2—health infrastructure plan 2—development post 2025. On the other hand, if the hospital waits for the HIP2 funding, it will lose its £46 million urgent care hub funding commitment, and the urgent replacement for the hospital’s overcrowded A&E may never happen.
I have four main asks of the Health Department and HM Treasury: first, permission for the hospital to draw down on the £46 million urgent care hub funding commitment so that work can start on the initial works required for the project; secondly, permission for the hospital to proceed with the preparation of its outline business case for the HIP2 investment expected after 2025; thirdly, an early advance of £52 million, spread over the next three years, from the £350m HIP2 commitment, so that the urgent care hub can be built not as a stand-alone project, but as the initial part of the phased hospital redevelopment; and, fourthly, that the Secretary of State for Health honours his welcome commitment made on the Floor of the House earlier today, in response to a question of my hon. Friend the Member for Wellingborough (Mr Bone), to meet the three hon. Members for north Northamptonshire to get the issues sorted out. The Secretary of State said: “Nothing gives me greater pleasure than making stuff happen, so I would be very happy to meet…to make sure we can get this project moving as soon as we can.”
Those four asks are not about asking for extra money over and above that which has already been promised. Instead, they outline a sensible, flexible and dovetailed approach to already given funding commitments, so as to maximise value for money for the taxpayer while also ensuring that local people get to see as soon as possible the badly needed improvements to our local hospital, which we have already been promised. Simply put, the problem is this: building the promised urgent care hub is no longer an option on a stand-alone basis. If it is built as a stand-alone project, there would not be enough room on the site for the subsequent HIP2 funding, so the value-for-money solution is to integrate the two funding streams.
Kettering General Hospital is ready to go. It owns the land, so no land deals are required, and no extra public consultation is needed. It has written support from local planners and the regional NHS. It is a phased approach that would deliver visible and real benefits. It is shovel ready and has far lower risks than other hospital build projects. In developing this whole-site plan—integrating the urgent care hub and HIP2 funding streams—the hospital has identified the best way of delivering value for money to get the buildings up and operating, serving local people.
Kettering hospital is unique among the 40 designated hospital rebuilds scheduled to be completed by 2030. First, it already has a Government commitment for a new £46 million urgent care hub. Therefore, its future funding is complicated as it comes from two separate funding pipelines. Secondly, it is ready to go, with an innovative, phased and value-for-money rebuild on land that it already owns, with no planning or consultative hold-ups. Thirdly, it serves one of the fastest growing areas in the whole country. Fourthly, it has one of the most congested A&Es of any hospital in the land, which needs addressing as a matter of urgency. I do not believe that any other hospital in the country has that unique set of circumstances.
Mr Peter Bone (Wellingborough) (Con)
Does my hon. Friend recall that this project in effect started before my hon. Friend the Member for Corby (Tom Pursglove) was elected in 2015? It has widespread cross-party support. If this were a business, without doubt a pre-payment would be made, because it would save money in the end and get things done. Are we just caught in a silo, with the Treasury here and the health service there? They must somehow mesh together.
Mr Hollobone
My hon. Friend is quite right. This is not a difficult problem to solve. It requires a political solution and it requires a decision by Health and Treasury Ministers acting together.
Kettering General Hospital is a much loved local hospital. With 500 beds, it has been on its present site in the heart of the town of Kettering since 1897—that is 124 years. There cannot be many hospitals that have such a record. Most of the residents in the parliamentary constituencies of Kettering, Corby and Wellingborough were born there—as my hon. Friend the Member for Corby was—have been repaired there or, sadly, passed away there. There can be very few local residents who have not accessed the hospital at some point during their lives. It also has a fantastically dedicated, talented and loyal workforce.
The pressure on the hospital is being driven primarily by very fast local population growth. The Office for National Statistics has shown that we are one of the fastest growing areas in the whole country, at almost double the national average. The borough of Corby is the fastest growing borough outside London. In the last census, out of 348 districts across the country, Kettering was No. 6 for growth in the number of households and 31st for population increase, while Corby has the country’s highest birth rate.
Kettering General Hospital expects a 21% increase in over-80s in the next five years alone. The area is committed to at least 35,000 new houses over the next 10 years. That means a local population rise of some 84,000 to almost 400,000 people. The A&E department, which is sized to see 110 people a day safely, now sees up to 300 patients every single day. Every day, 90 patients are admitted to the in-patient wards from A&E, and the hospital expects the number of A&E attendances to increase by 30,000 over the next 10 years, which is equivalent to almost 80 extra patients every day. That is why the promised improvements are desperately needed.
The big problem at Kettering General Hospital is that the A&E department is full. It was constructed in 1994 to cope with 45,000 attendances each year. It now has around 100,000 attendances a year, which is well over 150% of the department’s capacity, and by 2045, 170,000 attendances are expected at the same site. The solution to that pressure is for an urgent care hub facility, costing £46 million, to be constructed on the site. It would be a two-storey, one-stop shop with GP services, out-of-hours care, an on-site pharmacy, a minor injuries unit, facilities for social services and mental health care, access to community care services for the frail elderly, and a replacement for our A&E department. All the NHS organisations in Northamptonshire, as well as NHS Improvement regionally, agree that that is the No. 1 clinical priority for Northamptonshire.
The A&E department at the hospital was visited five years ago by Dr Kevin Reynard of the national NHS emergency care improvement programme. He said:
“The current emergency department is the most cramped and limited emergency department I have ever come across in the UK, USA, Australia or India. I cannot see how the team, irrespective of crowding, can deliver a safe, modern emergency medicine service within the current footprint.”
I am glad that the Government have recognised the hospital’s superb business case for this fit-for-purpose emergency care facility that will meet local population growth for the next 30 years. It has been developed with all the health and social care partners across the county so that patients can get a local urgent care service that meets all the Government guidance on good practice, ensuring both that they can get the care that they need to keep them safely outside hospital if necessary, and that if they come into hospital, they are seen by the right clinician at the right time and first time.
In announcing the award of £46 million for the new urgent care hub in the debate on 23 October 2019, the Minister said:
“My officials and NHS England will be in touch with the trust to discuss further details, in order to ensure that funds are released and that work starts on the project as swiftly as possible. I am conscious of the urgency that my hon. Friend the Member for Kettering highlighted.”—[Official Report, 23 October 2019; Vol. 666, c. 31WH.]
That announcement was 20 months ago, and the hospital has still not had permission to draw down that funding. That is why my first ask of the Government is to grant permission for the funding to be drawn down so that the project can start.
I warmly welcome the Government’s inclusion of Kettering General Hospital on the list of 40 hospitals for health infrastructure plan 2—HIP2—funding from 2025. That is important for Kettering, because 70% of the buildings on the main hospital site are more than 30 years old, and there is a maintenance backlog of £42 million. Some 60% of the hospital estate is rated as either poor or bad.
The hospital plan for the redevelopment of the hospital site as part of the HIP2 programme offers a phased approach over a number of years, with the extra ward space provided by this funding to be built on top of the urgent care hub. That is in contrast with a number of other hospitals in the HIP2 programme that are seeking all-in-one-go funding packages. The hospital is not asking for its HIP2 allocation in an up-front £350 million all-in-one-go lump sum. Instead, it is seeking a modular annual funding requirement for what would be a phased and value-for-money rebuild up to 2030. Surely, out of a £3.7 billion national hospital rebuild programme, providing just £6 million to the hospital this year to get the project started and £29 million next year is not beyond the wit of man.
I know that the Treasury is currently completing a commercial strategy for all the hospital rebuilds so as to standardise hospital redesign, secure key commercial efficiencies in procurement across the country and address digital and sustainability requirements. Kettering General Hospital is fully committed to those Treasury objectives. Value for money is extremely important in delivering the hospital rebuild programme across the country, and if Kettering General Hospital’s innovative and sensible approach was matched with sufficient flexibility in applying the relevant funding streams from the Department of Health and Social Care and the Treasury, Kettering General Hospital could be an exemplar hospital redevelopment that others could follow.
I am using this debate to urge the Government—both the Department of Health and Social Care and HM Treasury—to do the sensible thing: dovetail the two presently separate funding streams for Kettering General Hospital so as to not only optimise value for money for the taxpayer but deliver sooner rather than later the urgent improvements at the hospital that all local residents need and wish to see.
The Minister for Health (Edward Argar)
I congratulate my hon. Friend the Member for Kettering (Mr Hollobone) on securing this debate about the redevelopment of Kettering General Hospital. I know that it is an incredibly important subject for his constituents and, therefore, for him. He is nothing if not a strong champion for the people of Kettering, as Ministers forget to their cost. He works tirelessly on not only this but many other local matters.
I should also highlight the interest in and passion for this subject of my hon. Friend the Member for Wellingborough (Mr Bone)—who remains a friend, despite him seeking to slightly pre-empt and constrain me today by asking a question of my boss, the Secretary of State, a few hours ago in the Chamber—and my hon. Friend the Member for Corby (Tom Pursglove). As my hon. Friend the Member for Wellingborough rightly said, due to his elevated position as a senior Government Whip, my hon. Friend the Member for Corby is unable to speak in the debate, but I know from the interactions and conversations I have had with him on many occasions just how passionate he is about this hospital project on behalf of his constituents. I can reassure his constituents that, while he may not be speaking in the debate, I have had many lengthy discussions with him, and I suspect that I will be hearing from him many times in the future—although, hopefully, if I can offer some reassurance to my hon. Friend the Member for Kettering, he may be slightly less vociferous in pursuing me on this matter.
I join my hon. Friend the Member for Kettering in paying tribute to the chief executive and the team at Kettering General Hospital for the amazing work they do. They have worked tirelessly throughout this pandemic for his constituents and those of my hon. Friend the Member for Corby, as they do day in, day out, year in, year out for the people who live in that area. It has been a pleasure to take a very close interest in this matter. As my hon. Friend the Member for Kettering knows through his experience in the House, it is sometimes very difficult to say no to him, which can get Ministers into trouble; he is extremely persuasive.
Turning to the substance of the debate, I am delighted that the rebuild of the Kettering General Hospital part of the foundation trust is part of our plans to build 48 new hospitals by 2030—the biggest hospital building programme in a generation. To kick-start the scheme, Kettering General Hospital NHS Foundation Trust has already received £3.7 million of seed funding to develop its plans for the rebuilding of Kettering General Hospital.
Before I turn to the urgent care hub, my hon. Friend the Member for Wellingborough highlighted that plans for that had been mooted, discussed and possibly even agreed before 2015—before my hon. Friend the Member for Corby and I joined this House. The difference, I would suggest, is that on that occasion there was no budget allocated to the trust. For the urgent care hub, there is a budget allocated to it now, following our announcement in 2019, which followed lobbying by my hon. Friend the Member for Kettering. That funding will help transform the provision of urgent and critical care in this area. As he says, £46 million has been allocated for that project.
My hon. Friend asks why it is that, 20 months on since that debate and that visit—I remember them well and I will turn to them in a moment—the money has not been fully drawn down. This is in no way a criticism, but I would say that that is because of the announcement of the new hospital programme and the fact that the trust has, quite rightly, changed what it would like as a result. Therefore, discussions have had to take place about how those two funding streams can be meshed together. I will turn to that in a moment.
As my hon. Friend mentioned, the urgent care hub and the new hospital that are to be built share a set of common enabling works that have been factored into the new hospital development. As he and his trust have requested, we have shown flexibility and agreed to mesh the two projects together if an appropriate way of doing so, including the funding, can be found. As a result, the trust is seeking to incorporate the urgent care hub delivery into the wider redevelopment of the site. That means that the UCH may now be part of the first stage of building the new hospital, but he rightly highlights how approaching this in a more holistic way than a “phase 1 and 2” approach provides opportunities and synergies for achieving better value for money. He has made that point to me and to others.
On the drawdown of funding, the £46 million is available, subject to business case approvals and how those two funding streams can be meshed together in a single project. On drawing down from the new hospital programme fund more broadly, we have a one-year spending settlement from the Treasury. Therefore, if we wish to start drawing down from future years funding and make commitments, that is a matter for the Treasury and a future spending review. My hon. Friend quite rightly highlights, as I expected he would, the need for a synergistic approach between the Department of Health and Social Care and Her Majesty’s Treasury.
All of the new hospitals that will be delivered as part of the programme, including Kettering, are working with the central programme team, with the support of regional, system and local trust leaderships, to design and deliver their hospital in keeping with this approach. The central programme team and the new senior responsible officer, Natalie Forrest, who joined the team and took over its leadership at the beginning of this year, are working closely with the trust on the new build at Kettering and considering all the options currently on the table. I understand that they have had productive meetings, and I look forward to their having further productive meetings.
The programmatic approach will need to be carefully applied to these proposals, as for any other hospital in the new hospital programme, to see how we can best ensure value for money for the taxpayer through standardisation of design and the use of modern methods of construction, without unnecessarily constraining the ambitions of the trust’s plans, in so far as that is possible. The central team, as I have said, will engage with trusts to maximise the application of these approaches to ensure that the scheme has manageable, realistic and, indeed, affordable costs. Funding discussions for these projects are ongoing, and final amounts will be determined through the established business case and Treasury processes.
To stray slightly from the central theme, as my hon. Friend will know—as, indeed, he said in his remarks—Kettering General Hospital NHS Foundation Trust also received £1 million pounds as part of the £450 million investment to help upgrade A&Es and to help the NHS respond to winter pressures and the risks of further outbreaks of coronavirus. That funding was used to support compliance with social distancing and infection prevention and control at Kettering.
On interactions and conversations with the trust, as I have alluded to, the senior responsible officer, Natalie Forrest, met the trust on 2 March for a bilateral roundtable with its senior leadership team to discuss its proposed plans for the build. I understand that those discussions were productive, and they are ongoing. I, too, met the trust in February, with the SRO, to discuss the plans for a new build at Kettering General Hospital. As my hon. Friend mentions, I was fortunate enough to visit the hospital in September 2019 to see for myself, and to be shown by him at his most persuasive, what the case for investment was. As he mentioned, I also had the pleasure of answering a Westminster Hall debate last October on the need for the urgent care hub being funded and built in Kettering, during which I also had the pleasure of confirming the funding, following on from the announcement and promise made by my right hon. Friend the Prime Minister to my hon. Friend. Today’s debate is probably not the right time to discuss this, but I know that all three of my hon. Friends have highlighted the wider opportunities of combining health and social care for vulnerable adults in Northamptonshire.
Our ambitious programme to build 40 new hospitals by 2030 has confirmed funding of £3.7 billion at this point. That is an important and extremely positive start, but we continue to work with Her Majesty’s Treasury on future funding for the whole programme, including for Kettering, and the profiling of the availability of that funding. That is not the reason I am not, at this Dispatch Box, being gently lured by my hon. Friend into a clear commitment today on firm profiling of financial allocations for Kettering at this stage; rather, it is because deciding the funding level for a project of this scale, at this early stage in the process, before full design, exploration or scoping is complete, would not be the most appropriate approach, although I take his point about, for want of a better way of putting it, the need for speed.
Our experience of Government projects and, specifically, the lessons learned from the early work of the Chancellor’s Project Speed taskforce and from the experts in the Government’s Infrastructure and Projects Authority tell us that confirming funding for large, complex projects too early, before all parties are fully agreed on the future approach, can put the project and its overall cost at risk. I am not in any way questioning the ability of my hon. Friend’s local hospital trust to come up with a costed and extremely effective project plan, but it is important, as he would expect, that we are conscious of the need to ensure that we get value for money and the best outcomes for his constituents.
In conclusion, I pay tribute to my hon. Friend, and to my hon. Friends the Members for Wellingborough and for Corby, for the work they are doing to support the redevelopment of Kettering General Hospital. I know that my right hon. Friend the Secretary of State gave the commitment to my hon. Friend the Member for Wellingborough that he would meet him, and I know that he will honour that. I reiterate my commitment that if any point, on perhaps at a more detailed or granular level, my hon. Friend the Member for Kettering wishes to meet me or the SRO again, I am happy to do that. Perhaps as we see progress made in opening up our country again, I might be able to enjoy the pleasure of returning to Kettering to see him and his hospital trust in person. I look forward to continuing to work with him to making sure that this ambitious and innovative approach to building new hospitals is a success.
My hon. Friend is, rightly, incredibly proud of his team in Kettering. He and his colleagues have done a fantastic job of gently inducting me into quite how fantastic the team are and what is needed to get this project going. It was one of the first visits I made when I became a Minister holding this role, so I have a particular affection for that area—I am an east midlands MP, so I know it well. I hope that we will continue to be able to work hand in hand with his trust, the national programme and Her Majesty’s Treasury to move this programme forward at pace. I know it is what he wants, but most importantly I know it is what his constituents would want and expect of us.
Question put and agreed to.