Westminster Hall

Tuesday 14th December 2021 Westminster Hall

Tuesday 14 December 2021

[Dame Angela Eagle in the Chair]

Co-operatives and Mutual Societies

Tuesday 14th December 2021 Westminster Hall

00:00

[Dame Angela Eagle (in the Chair)]

Before we begin, I remind Members that they are expected to wear face coverings when they are not speaking in the debate. This is in line with current Government and House of Commons Commission guidance. I remind Members that they are asked by the House to have a covid lateral flow test twice a week if coming on to the parliamentary estate. This can be done either at the testing centre in the House or at home. Colleagues may wish to know that I have just had a negative one, so I think I, at least, am safe for now. Please also give each other and members of staff space when seated and when entering and leaving the room.

[Mr Steve Baker (Wycombe) (Con)]

I beg to move,

That this House has considered the contribution of co-operatives and mutual societies to the economy and public life.

I am delighted to serve with you in the Chair, Dame Angela, and I am very grateful to everybody who has attended. I am slightly conscious that today’s other business might have distracted some of my Conservative colleagues who signed up to the application. I lament the fact that they are not here, but there we are—I cannot think what else is going on at the moment. I am very grateful to Co-operatives UK for inspiring this debate and for providing an excellent brief, on which I will rely closely.

A free society—one based on a market economy—really must have within it a place for co-operatives, and the Conservative party might not always have embraced that idea as tightly as I might have liked. Given the length of time for which we have been in power, and given how long we will have been in power by the next general election, I hope that the Conservative party can champion and not merely embrace co-operatives as a really important part of a free society. Co-operatives can be harnessed as tools to expand opportunity, wealth, liberty, pride and aspiration more fairly in the UK, both geographically and socially. They are a powerful tool for funding and implementing the UK’s new net zero strategy.

The co-operative economy is diverse, resilient and growing. There are now more than 7,000 independent co-operative businesses in the UK, with a combined annual turnover of almost £40 billion and more than 250,000 employees. They trade in sectors as diverse as agriculture, renewable energy, retrofitting, the creative industries, manufacturing, distribution, wholesale, retail and finance. In 2020, the turnover of the co-operative economy grew by £1.1 billion, and twice as many co-operatives were created as dissolved. Most co-operatives in the UK are consumer-owned, but in recent years we have seen a marked growth in community ownership, worker co-operatives and freelancer co-operatives. Many of the UK’s largest co-operatives comprise other businesses, such as farmers co-operatives.

By international comparison, though, the UK co-operative economy is small and growing slowly. Less than 1% of businesses in the UK are co-operatives. Germany’s co-operative economy is four times bigger than the UK’s, and France’s is six times larger. That might well derive from history, but I say to the Government that now is a moment when we can choose positively to take a path that makes it more possible for co-operatives in the UK to grow. The UK’s co-operative start-up rate is also comparatively low. In recent years, South Koreans have created 12 times more co-operatives per head of population than we in the UK have. Perhaps the co-operative model is underused and is something of a best-kept secret in our society and economy.

Co-operatives are great vehicles for creating and sustaining decent, rewarding and empowering livelihoods. For example, after five years of trading, the average worker co-operative in the UK supports six times more livelihoods and is almost twice as likely still to be trading as start-ups generally. According to a multi-country study, although they are currently far fewer in number than businesses generally, worker co-operatives are on average larger and employ more people. There are examples of co-operative entrepreneurship, for example the taxi drivers in Cardiff who clubbed together to set up their taxi-hailing co-operative, and of participation in existing freelancer co-operatives, such as the new co-operative mutual aid platform, We-Guild, or the creatives’ co-operative Chapel Street Studio.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

The hon. Gentleman mentioned the taxi co-operative in Cardiff. I was delighted to work with a number of local drivers who were dissatisfied with their working conditions in other firms and who got together, worked with the Wales Co-operative Centre—to whom I pay tribute—and set up the remarkable co-operative, Drive, which references the Welsh phrase “Thank you, Drive!” at the end of a journey. I wholeheartedly agree with what the hon. Gentleman said.

[Mr Baker]

Marvellous. I am looking forward to the hon. Gentleman’s contribution later, when I hope he will tell us all about that. It is wonderful to have cross-party agreement on some of these subjects, and I hope we can drive forward the agenda.

Large co-operative employers are at the forefront of good business behaviour when it comes to investing in people. I think that follows directly from the ethos of the co-operative movement—the idea of valuing everybody equally and having open and inclusive membership, for example. I will not go through all the details, because we will be here for an hour, but co-operative models can be used as tools for community-led economic development. There is a wide range of examples from right across the country—I hope Members will share some—which show how co-operatives can be at the heart of bringing people together.

What can co-operatives achieve? They can expand wealth and well-being. The efficacy of the model can lead to a proliferation of co-operatives that can help to strengthen the private sector, including in places that need it the most. That is because co-operatives are distributive by design. Value, wealth and well-being are shared more broadly through day-to-day activity.

A growing body of data shows that co-operatives are especially resilient businesses. At a time like this, resilience could not be more important. Official data in our country shows that co-operative start-ups are twice as likely as start-ups generally to survive the first five years of trading, for example, with similar findings in other countries. Separate research shows that co-operatives in the UK that raise equity via community shares—a crowdfunding model unique to co-operatives—are more resilient still, with a 92% survival rate.

Official data also shows that co-operatives were four times less likely to permanently close in 2020 than UK businesses generally. Research published by Scottish Enterprise shows resilience among employee-owned businesses in Scotland throughout the pandemic. The fact that twice as many co-operatives were created as dissolved in the UK in 2020, when there was a net reduction in the number of businesses in the UK overall, suggests that co-operative entrepreneurship was a comparatively resilient force during the economic and psychological shocks of the pandemic.

Why are co-operatives so resilient? They have purpose, and their ownership and governance dictate long-termism. In an economic shock, it is the members making the tough decisions in their collective, long-term interests; it is not investors demanding lay-offs to protect short-term returns. Co-operatives also patiently build up and re-invest reserves and use members’ capital wherever possible, rather than piling on debt to achieve faster growth. My hon. Friend the Minister knows some of my views about excess debt creation.

I am conscious of time, and I want to give way to other Members, but I will say that at a time like this, when we need to recover to from coronavirus, co-operatives can be an ever more important part of our society in bringing people together and giving them a shared purpose and an equal stake in the business in which they work.

[Mr Gregory Campbell (East Londonderry) (DUP)]

The hon. Gentleman is speaking about co-operatives now, but I am sure he will come on to mutuals, which are also included in the heading of the debate. Does he agree that it has been remarkable and refreshing to see the members of the mutual society LV= use their power in the past few weeks to demonstrate exactly what he has referred to? They wanted power to go to the membership, as opposed to going to shareholders for a fast buck.

[Mr Baker]

I am grateful to the hon. Gentleman for his intervention. I hope to make a few remarks about mutuals, but I am focusing first on co-operatives. I have been involved in the inquiry into LV= by the all-party parliamentary group for mutuals. LV= made quite a compelling case, but the point is that, as he said, it is up to the members what they do. In a free society, we make progress through trial and error. It might well be that that members have made a mistake in rejecting the bid, but it is their right to do so; it is their right to choose.

I am a huge fan of mutuals, because I can see that they are bound to create a set of incentives that support the people whom the business serves. I remember in my youth being very disappointed that so much carpetbagging was going on, with people taking £500 in exchange for demutualising. I was very disappointed at the time, and even as a teenager I could see that it was not a good idea. In the case of LV=, I fear that things are not going where they should. I very much hope that my hon. Friend the Minister will ensure there is a good quality inquiry into what is going on, and into how regulation can better support people’s desire to support the mutual spirit in the future. I think he would agree that we cannot afford to be romantic and exempt co-operatives and mutuals from the realities of commercial life, or the exigencies of things such as competition law.

I turn to performance and efficacy. The principle of mutual purpose and democratic governance is found in all co-operatives, and it has significant advantages. It is a proven way for people with a shared interest to collaborate effectively, achieving things together that they could not on their own. That is a great way to expand liberty.

Liberty is something that should be exercised in community. One of my favourite scholars said:

“Society is cooperation; it is community in action.”

We should remember that entrepreneurship is a great search to help other people; that is what entrepreneurs seek to do. If people make a profit justly, without breaking the rules or exploiting others, that is a good thing. It shows that those people have served others, according to their assessment of what has been produced. I believe that that combination of mutual interest and service to others through a market means that co-operatives should be a crucial part of our society.

I am conscious of time, so I will wrap up. The Co-operatives UK brief makes a number of suggestions to the Government, including that there could be more co-operatives, and some particular policy suggestions. There are three themes: to have better tailored business support and enterprise finance for existing co-operatives, co-operative entrepreneurs and the conversion of existing businesses to become co-operatives; to have legislative and non-legislative action to provide a more enabling corporate framework, through law, regulation and processes; and to have tax support for investment in co-operatives and co-operative development. I will not go through the full brief, but Co-operatives UK intends to publish it after the debate.

I appreciate this opportunity to hear from Members from all parts of the House about co-operatives. We can all enthuse about co-operatives, even as we remain, as I am sure the Treasury will do, robustly pragmatic rather than romantic. As the Conservative party softens and become more inclusive and society minded in the 21st century, we ought to say that co-operatives and mutual societies are an important part of our society that should be fostered in everyone’s interests, particularly as we come back from coronavirus. We need to build up the mutual relations of interdependence on which we all rely.

[Dame Angela Eagle (in the Chair)]

It is my intention to call the Front-Bench speakers from 10.30 am, so you can do the maths yourselves in order for everybody to get the chance to speak.

09:42

[Sir Mark Hendrick (Preston) (Lab/Co-op)]

It is a pleasure to serve under your chairship, Dame Angela. I congratulate the hon. Member for Wycombe (Mr Baker) on securing this important debate at such a critical time, when the economy and society should be in the throes of recovery from the covid-19 pandemic.

It has been 177 years since the since the pioneers successfully launched the co-operative movement in 1844 in Rochdale, Lancashire, which is not too far from my own Lancashire constituency of Preston. The movement has gone from strength to strength, and it has changed remarkably since then. As a Co-operative party MP, I have always believed that co-operatives and mutual societies are the future, not the past, and they are instrumental in creating a successful, democratic economy.

Co-operatives and mutuals contribute significantly to social integration, job creation, employment sustainability and the reduction of poverty, which makes them a serious player in the UK’s recovery from the pandemic. A key component in the make-up of co-operatives is the democratic ethos of fairness and inclusivity, where wealth and power are shared. Whether it is co-operative shops, funeral services, credit unions or, as has been mentioned, taxi firms, co-ops are owned and operated by the people closest to the business and are centred around their members and the community, rather than distant investors and shareholders focused solely on monetary returns.

When considering the impact of the covid-19 pandemic on our society, it is impossible not to acknowledge the glaring inequalities that have been exposed in our social and economic fabric. The poor of this country have borne the brunt of the devastation. The stark geographical and social divide is a clear indication that the current economic model is broken and not viable for the future.

If we are serious about levelling up the country and building back better, working people must be at the heart of economic recovery. Co-operatives and mutual societies provide a template for achieving success, where the principles of human and social capital are at the core of policy. There is no doubt in my mind that to achieve a stronger, sustainable and more resilient recovery from the covid-19 crisis, the Government must take steps to expand the co-operative sector. The evidence tells us that co-operatives are resilient; 76% of co-ops survive the first five years of business, compared with only 42% of other types of business in the UK.

I was interested to hear the points made by the hon. Member for Wycombe about whether LV= members should have gone with Bain Capital. Only time will tell whether that would have been a good move, but many of the building societies that demutualised and turned into banks were extremely vulnerable in the financial crisis some 15 or 20 years ago. I was a member of Leeds Building Society, and I tried to vote against demutualisation. In the end, I was given £2,000 and ended up with a bank I did not particularly want.

As has been mentioned, the trade body Co-operatives UK notes that about 1.5% of co-ops were dissolved in 2020, compared with 6.5% of businesses in general. Despite the pandemic, the number of independent co-ops has grown by 1.2% in 2020.

On the contributions of co-operatives to public life, the valuable and diverse sector has demonstrated its worth in meeting community need in the face of adversity, which it has done up and down the country in the last 21 months. I proudly note the co-operatives in my constituency of Preston, which led by example and contributed to the collective welfare of the local community during a time of great need. By investing in people from the start, co-operatives were able to defend workers’ wellbeing and livelihoods during the pandemic, while understanding the hardships that people faced and serving the community around them. Studies show that economies with a larger co-operative sector are more equitable, productive and accountable, with a narrower gap between rich and poor.

With all this evidence on the benefits of co-operatives, both before and during the pandemic, I wonder why there are not more of them. As the hon. Member for Wycombe said, in 2020 less than 1% of businesses were co-ops. Despite the evidence that they are nearly twice as likely as other types of businesses to survive their first five years, not nearly enough of them are being started. In the UK, more than 7,000 co-ops contribute roughly £40 billion to the economy, in spite of numerous financial and social barriers that hinder their ability to reach their full potential.

[Stephen Doughty]

My hon. Friend is making powerful points. I want to share another example of success that we can learn from. The Welsh Labour and Co-operative councillors in Vale of Glamorgan Council in my constituency have done remarkable work with Big Fresh Catering Company, a local authority trading company built on co-operative principles. In its first year, it has turned a £350,000 deficit into a £500,000 surplus, which is now being reinvested in our schools. That is an example of co-operative principles making a difference, led by Welsh Labour and Co-operative councillors.

[Sir Mark Hendrick]

I commend my hon. Friend on his involvement and the success that he outlines.

In developed countries such as our own, co-operatives play a much bigger role in GDP and cultural make-up, by design. As the hon. Member for Wycombe said, in Germany, the co-operative sector is four times bigger than in the UK. In France, 18% of GDP comes from its co-operative economy, which is six times larger than the UK’s. Unlike in those countries, our economy is tailored to the interests of private business, despite the overwhelming evidence of the co-operative sector’s success and resilience.

I believe that a strong and growing co-operative sector is key to creating a post-covid economy where wealth and power are shared, particularly in efforts to level up the regions of the country that have been worst hit by the pandemic. We cannot create such an economy by maintaining the status quo and hoping that more co-operatives and mutual societies will carry on as they have done—instead, co-operatives and mutual societies need the support that other business models receive, which is why the Government must urgently commit to bringing forward practical business support aimed at significantly growing the UK’s co-operative sector as part of our economic recovery. In their policy, the Government must enable a corporate framework that recognises and champions the success of co-operatives and mutual societies, and understands the value and mutual benefits of achieving that success.

As we rebuild today and for the future, we have an opportunity to create an economy of ambitious growth, wellbeing and social protection for all. That is why I believe that co-operatives and mutual societies are one answer to the problems raised by the current pandemic.

09:50

[Christina Rees (Neath) (Lab/Co-op)]

It is always a pleasure to serve with you in the Chair, Dame Angela.

Robert Owen is regarded as the founder of our co-operative movement. He believed that character is formed by environmental influences such as educational opportunities on the one hand and by poor working conditions on the other. His vision was for villages of co-operation, a new world order of mutual help and social equality, and his followers were called co-operators or socialists. I am very proud that Robert Owen was born on 14 May 1771 in Newtown, Powys, in my beautiful country of Wales.

The Co-op group traces its roots back to the start of modern co-operation in Rochdale in 1844, and 177 years later the Co-op group continues to put its members and their passions at the centre of its business, with a focus on working with others—co-operating. Since its launch in 2016, the Co-op group’s local community fund has provided approaching £100 million to more than 20,000 local good causes, making it one of the largest funding mechanisms for charities in the UK.

UK co-operators believe that too much power and wealth rests with a small number of investors, shareholders and executives. Decisions are often made for the benefit of the powerful and the wealthy and not for the benefit of communities, workers, consumers and the environment. I believe the answer lies in the Marcora law. I was fortunate to secure a Westminster Hall debate on 8 September about the co-operative purchase of companies. I urge the UK Government to learn from Italy, where the former Industry Minister, Giovanni Marcora, established the worker buy-out system more than 30 years ago.

The Marcora law was established in a period of economic crisis in the 1980s to encourage workers to become entrepreneurs, saving their jobs by taking their entitlements plus three years’ projected social security payments in a lump sum to invest in a new company, supported by Government loans and advice. Specifically, the Marcora law established a rotation fund for the promotion and development of co-operation, and a special fund for the protection of employment levels. It gives workers the pre-emption right to purchase their companies and, more importantly, the financial support to buy out all or parts of an at-risk business and to establish it as a worker-owned co-operative.

The Cooperazione Finanza Impresa—CFI—operates the Marcora law on behalf of the Ministry of Economic Development of the Italian Government. The CFI is an institutional investor and has been implementing the Marcora law since 1986. The Ministry holds a 98.6% share of the capital investment and has an overseeing role on the CFI board. The CFI has made investments of more than €300 million in 560 companies, saving the jobs of 25,000 workers and retaining the skills and experience of the Italian workforce. Hundreds of Italian businesses at risk of closure have been preserved as worker co-operatives, with a return of more than six times the capital invested by the CFI funding mechanism. Our UK Co-operative party public polling shows that 64% believe that the economy would benefit if workers could buy their businesses when they were at risk of closure.

During my debate, I urged the UK Government to introduce legislation that would give workers an adequate opportunity to request ownership during business succession and to provide an early-warning system to warn workers in advance of insolvency or when viable businesses are at risk of disposal. That would give workers the time and ability to assess the scope of acquisition and prepare a co-operative business model, and it would provide an opportunity to bid for a business at risk of shrinking or closure. A UK Marcora law would sustain businesses and help the UK shift to a fair and democratic economy through our co-operative values.

I asked the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Sutton and Cheam (Paul Scully), whether he would introduce a UK Marcora law and he told me that there were no plans but that the Government were open to proposals. Mark Drakeford, the First Minister of Wales, and his Welsh Labour Government were overwhelmingly re-elected last May on a Senedd election manifesto that pledged to provide greater support for worker buy-outs. Mark has stated many times that he will work with the co-operative sector and the Wales Co-operative Centre to double the number of worker-owned businesses in Wales, and he appointed Vaughan Gething, the Minister for Economy, with specific responsibilities for the co-operative sector in Wales.

In Wales, we are proud to have the Wales Co-operative Centre, set up by the Wales Trades Union Congress in 1982 to provide business support to co-operatives in Wales. The centre’s research shows a business succession timebomb. Small and medium-sized enterprises make up 99% of businesses and 62% of private sector employment in Wales, but 43% do not have a succession plan and only 12% of family firms make it to the third generation. One in five SMEs faces the prospect of closure or succession in the next five years, with 29% under the same ownership for the past 21 years. So 15,000 business owners may be leaving their businesses. That is one of the reasons a UK Marcora law is so important: to save family businesses.

My friend Huw Irranca-Davies, MS for Ogmore and a former MP, who is chair of the Senedd co-operative group, introduced an employee ownership Bill to the Welsh Parliament to give workers support to buy out their workplace if it is at risk of failure. It received cross-party support in principle in the Senedd from Labour, Plaid Cymru and the Liberal Democrats. Huw will now meet Welsh Government Ministers to see how to progress his Bill.

While I was disappointed with the response from the Under-Secretary of State to my debate of 8 September, a few days later I had a lovely surprise. I received a letter from Camillo De Berardinis, the CEO of the CFI, saying that he had watched my speech in the Westminster Hall debate and that he was inviting me to be the guest speaker at the 35th anniversary of the CFI on 16 November to celebrate the commitment of all the Italian workers who had bravely tackled the crisis of the company they worked for and successfully recovered it. I was honoured to accept that invitation. It was virtual, by the way; I did not manage to get to Italy, but there we go.

The Minister will be pleased to know that I will not be giving up campaigning to have a UK Marcora law. On 11 January, I will introduce a ten-minute rule Bill entitled the co-operatives employee company ownership Bill. I know the Minister is very magnanimous and he does listen, so, to conclude, does he now have any plans to introduce a UK Marcora law?

09:58

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in this debate, and I have spoken in these debates in the Chamber and in Westminster Hall as well. First, I thank the hon. Member for Wycombe (Mr Baker) for setting the scene so well. He brought the issue to Westminster Hall some time ago and I spoke then, and I mean it honestly when I say that his presentation has been absolutely on the button.

I have often said that co-operatives, mutual societies and indeed credit unions are a phenomenal help to so many families throughout Northern Ireland—I obviously want to give a Northern Ireland perspective to the issue. I want to speak about the co-operatives in my constituency and the Newtonards Credit Union branch, which has been the salvation of many people I know in a difficult time.

I commend my hon. Friend the Member for East Londonderry (Mr Campbell) and concur with his comments on LV= mutual, which the hon. Member for Wycombe also referred to. It is really important that those at the ground level of the co-operatives, mutuals and credit unions have some say in where they go. My local credit union has mentioned that it would do more for people if it was given the opportunity to do so.

I was happy read an article last week on affordable social housing in Northern Ireland that gave examples of how things can progress. In it the Northern Ireland Communities Minister indicated that the role that credit unions and others can play should be further explored. She said:

“If we are to achieve our objectives it is likely that a wider range of sources for financing will be needed such as charitable trusts and foundations, credit union loans, capital markets: from the sale of long-term bonds and developer contributions.”

The benefits of housing co-operatives, community-led housing and self-build initiatives

“will also need to be explored further”.

She is absolutely on the button, and she is right in what she says.

In a debate on affordable housing we had in this Chamber last week, I mentioned the good work of community-led housing and self-build initiatives. The good that could be done must be more widely investigated throughout the United Kingdom, and I urge the Minister—he always responds in a constructive way to our requests—to work collaboratively with the devolved Administrations to unlock further the best-kept secrets of credit unions. He has spoken about credit unions before, and we have had conversations about them both outside and inside the Chamber.

A lovely article in the Financial Times succinctly sums up what co-operatives, mutuals and credit unions are really about:

“The history of non-profit lenders has been intertwined with civil rights movements in the UK and abroad since the second half of the 20th century, as campaigners, religious groups and philanthropists sought to help marginalised groups gain greater access to financial services… Credit unions act like community-focused banks, using deposits from members’ savings accounts to fund low-cost loans with interest rates capped at 1 per cent per month in Northern Ireland and 3 per cent per month in the rest of the UK—about 43 per cent APR.”

In the past, I was fortunate to have one of the Minister’s colleagues—he was then a Minister but he is not now—visit Northern Ireland and particularly the credit unions. His input on that visit was incredibly helpful. We visited the credit union in Newtownards and met the man in charge, George Proctor. He has built up the membership—both adults and young people—phenomenally and it has become a major go-to when it comes to being a voting member and being able to borrow money whenever people need it.

The credit union sector is large and has grown in recent years. There was about £1.6 billion in outstanding loans at the end of 2020—up 19% since 2016—but the sector also faces challenges in keeping up with regulations and changing customer expectations of services such as online banking. The number of UK credit unions fell by more than a fifth in the same period, as smaller unions closed and were taken over by larger groups. Although the numbers are down, the clientele has kept steady and has risen. Credit unions are an essential component in any rural area and town, as they offer people the ability to save money, to borrow money, when needed, at a small interest rate, and to repay that money at an affordable rate, with no stress. Suddenly, the boiler breaking down three weeks before Christmas does not result in a nightmare but can be quickly and efficiently dealt with by using local credit unions.

I am fortunate to have 13 registered credit unions and co-operatives in my constituency, and I will name each one for the purposes of Hansard: Downpatrick Co-operative Marketing Ltd, Northern Ireland Fish Producers’ Organisation Ltd, the Ballynahinch Credit Union Ltd, Portaferry Credit Union Ltd, Newtownards Credit Union Ltd, Newtownards Royal British Legion Club Ltd, BDS Credit Union Ltd, Ards Saturday Market Traders’ Co-operative Limited, Comber Community Credit Union Ltd, Strangford Down Ltd, Northern Ireland Horse Board Co-operative Society Limited, North Eastern Lobster Fishermen’s Co-operative Society Limited, Ballywalter Youth and Community Co-operative, and Comber Earlies Growers Co-Operative Society Limited. All of those, at different levels and with different financial resources, represent a large number of people.

[Mr Gregory Campbell]

My hon. Friend is itemising the co-operatives in his local area, which can be replicated across the United Kingdom. Does he agree that as long as these groups, whether they are mutuals, co-operatives or credit unions, can demonstrate their professionalism and their adaptability in the modern marketplace, are to be supported? They need to see the wider community rally behind them and get involved with them for the better future of all of our communities going forward.

[Jim Shannon]

I thank my hon. Friend for that intervention. Yes, I do agree. When we look at the breadth of the market, and who these organisations represent, it indicates support that goes above and beyond. There are cattle market co-operatives, farmers’ co-operatives, fishermen’s co-operatives, plus a few reasonably sized credit unions. The agricultural co-operatives, the credit unions and the market traders co-operative—bringing all those people together, as my hon. Friend said—are examples of co-ops that help to sustain an independent rural community and a way of life. They are an essential component of these communities and a lifeline for them.

These organisations are undoubtedly able to do more, when we consider that the Financial Conduct Authority estimates that 28 million people—more than half of UK adults—have some element of financial vulnerability. In February 2020, up to a third of adults had less than £1,000 in savings, and one in 10—about 5.6 million people—had been paying a high-cost loan with an annual interest rate above 100% at some point in the preceding 12 months. What co-operatives, mutuals and credit unions do is enable their members to borrow at rates that they can afford to pay back. It is not like going to a payday loan company or others in the community who take advantage of people in their time of vulnerability. What these organisations offer is critical for the future.

Perhaps the Minister can give us some indication of any discussions he may have had with credit unions or co-operatives in Northern Ireland. I know I asked that earlier on, but it is always good to get a perspective here, in Westminster, where we are all under the great Union flag of the United Kingdom of Great Britain and Northern Ireland together—we are all part of that.

There is an issue with lending, and it is my firm belief that credit unions could be a way of dealing with this issue. Further, more investment and help should be given to allow credit unions to push their products and abilities into more communities as a viable savings and loans option. With that, I will conclude by thanking the hon. Member for Wycombe for introducing this debate, and I look forward to the comments from the shadow Ministers and the contribution from the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard).

[Dame Angela Eagle (in the Chair)]

I intend to call the Front-Bench speakers no later 10.28 am.

10:08

[Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)]

Thank you, Dame Angela. You will be pleased to hear that I will not inflict 20 minutes of Plymouth co-operatives on everyone. However, I would like to thank the hon. Member for Wycombe (Mr Baker) for introducing this debate. It is really important that co-operatives and mutuals have a voice in Parliament; that is why, for the past many decades, we have had a Labour and Co-operative group of MPs that has been making the case for co-operatives. I am proud to be a Co-operative party MP; those are not just some extra syllables in my job title. Being a Co-operative MP is not just a label; it is an instruction to campaign for mutuals, fairness, co-operation, doing business in a fairer way and sharing wealth and power. Those of us in the Co-operative party take every opportunity to put forward the huge advantages of co-operative and mutual business models.

We have seen huge changes and progress in recent years, both under the last Labour Government and, where campaigns have been successful, under the current Government. However, we are seeing the context change; we are seeing a hollowing out of our communities and a more precarious environment for businesses. However, we are seeing no less entrepreneurism and no less drive and creativity from our businesses. People are now looking at alternative models to organise their business to make a difference.

When businesses fail, it is often because those in charge have become removed from the realities of the shop floor. That is where mutuals and co-operatives have an advantage over other business models. When workers have a stake in their own business, they can contribute to the decisions that are made; they can see that businesses can be better run, more sustainable and better focused on not only the product and service they offer to their customers, but the people who work in that business to make it better every day.

Co-operatives provide an opportunity to renew our high streets and villages and to give everyday people a say in how their local community works. The opportunity to expand the co-operative and mutual sector is immense. I would like to see the Government adopt Labour’s policy of doubling the size of the co-operative sector. It is a bold, challenging ambition; however, if Ministers put in place the right conditions to make it happen, it is also achievable.

Doubling the size of the co-operative sector would lead to more sustainable, greener and better jobs in all our communities, more people having a stake in the businesses they work for and, as we heard from the hon. Member for Wycombe, better productivity and better outcomes at the end of it. It is a win-win-win situation. There are only two things that hold it back: a view that the market will provide for itself—in which case, let us remove the legislative blocks that sometimes discriminate against co-operative and mutual businesses—or a view that it will not provide the type of future we need. I do not see a future that does not include more mutual and co-operative businesses. That is what we heard from the hon. Member for Wycombe, and I hope that is what we will hear from the Minister when he gets to his feet.

In the south-west, we have long believed in the power of co-operatives to strengthen our economy. In Plymouth, we have co-operatives such as Nudge Community Builders, which works to transform life chances in one of our poorest communities—not just in Plymouth, but in Britain—by rebuilding and refurbishing buildings along Union Street and Stonehouse. It is transforming that community by not only improving the buildings, but creating spaces for start-ups, social enterprises and community services. It is helping to restore pride in something by allowing people to invest in their own community through that effort.

I bought shares in Nudge’s co-operative share issue to help reopen the notorious pub The Clipper, on Union Street, taking it from a 24-hour boozer to an amazing community space. It has transformed that community just by changing one pub. I have also bought shares in its latest effort, to reopen the Millennium building—a former nightclub and cinema, and the scene of far too many antics to discuss in polite company—as a new hub for live music, with a brewery, a shop and restaurants, and a place for people to come together. That building has stood derelict for decades, and it is a co-operative and community venture that is bringing it back to life. That share issue is still open, if the hon. Member for Wycombe wants to show his support. I know that Nudge would welcome a final push to help get it over the line.

However, it is not just Nudge that has done brilliant things using co-operative share issues. I also praise Plymouth Energy Community.

[Mr Steve Baker]

The hon. Gentleman has spoken with such passion and enthusiasm—he could not see, under my mask, the enormous smile he put on my face. If he sends me a link to Nudge’s site, I will have a look at investing. I would be delighted to consider it.

[Luke Pollard]

I thank the hon. Gentleman for his enthusiasm. I am really passionate about this issue, and people in Plymouth that have invested are passionate too. It is not just about investing. Co-operative share issues have not had the press they deserve, because it is not just that putting that 50 quid in a co-operative share issue or a mutual will return more financial benefit than leaving it in a bank where interest rates are low. It is about the social purpose—the social multiplier—and the economic multiplier that will come from that investment. It is taking place not only in Plymouth, but right around the country.

Plymouth Energy Community has funded solar panels on the roofs of our city’s primary schools and our largest leisure centre, as well as on the top floor of all our car parks. It has opened Plymouth’s first solar farm in Ernesettle and it is about to apply for planning permission for a second solar farm at Chelson Meadow—next to Saltram House—which is the scene of Plymouth’s largest landfill. I will support that share issue when it opens, too.

CATERed is another superb example of a co-operative in Plymouth. Faced with the challenge of poor school food, the Labour council brought together food provision into a co-operative, which our primary schools and some secondary schools have now bought into. That provides not only healthy, nutritious food but an investment in the staff who provide that food—in the kitchen and serving—which is unbelievable. What is important is that those staff feel valued, the food is healthier, the profits are reinvested and there is not a turkey twizzler in sight. It really is a model for others to follow.

[Stephen Doughty]

My hon. Friend’s example sounds very much like the Big Fresh Catering Company in the Vale of Glamorgan, which I mentioned. Does he agree that co-operative councils, such as in Cardiff—Plymouth sounds like a co-operative paradise; I assure him that Cardiff is too—are also making differences in other areas of public services by using co-operative principles? I think of our music strategy and the Cardiff Music Board, Cardiff Commitment, which is supporting young people back into education or training, and our race equality plan. All have co-operative principles at their heart, investing in that social capital in our communities.

[Luke Pollard]

My hon. Friend is exactly right. There is an energy around this policy area not only because it returns good outcomes but because it is the scene of so many good ideas and so much innovation. That innovation is often at the periphery, because co-operatives and mutual are not mainstreamed in the way that they really need to be. There is not an accelerator that moves those ideas into the mainstream. As co-operators, many of us are quite nice, decent people, and mutualism has a reputation of being nice and caring for and lovely, which often means that we are quite comfortable sitting in a corner. As an economy, we often say, “We have got a fair mutual side; it’s over there in the corner.” We know it is important because we put it in the corner where we put all our important things. It is time now to move mutual and co-operative policies into the mainstream, not only as niche providers but as an alternative to mainstream provision that would give those mainstream business models a run for their money. To do that, some of those legislative and, in particular, financial resourcing barriers need to be removed. There is an opportunity to go through them progressively and remove them, to make sure that we are getting there.

Creating a co-operative development agency in England, following the lead of Wales, would make a big difference. We could put new duties on Governments to promote the growth of co-operatives, not just of businesses. We could look at new capital instruments, such as a national co-operative-held investment bank, which would allow better investment in UK co-operatives. We could consider a new duty on banks to encourage greater lending to co-operatives and to ensure banks are held to account over the types of businesses they support. There is sometimes discrimination in funding to co-operatives because their corporate structures can be a little bit different, a little bit challenging. However, the social benefit and opportunities that come from that investment can be even bigger than investing in the usual type of business models. There is an opportunity there to make that happen.

[Christina Rees]

My hon. Friend is giving a passionate and comprehensive speech. The number of co-operatives is low. Perhaps there is a case for a business model in which a co-operative’s share of a private or public enterprise could be incorporated into the model, so that we raise awareness of the advantages of being part of a shared ownership scheme.

[Luke Pollard]

I am grateful to my hon. Friend for that. Long before I had grey hair and was elected to this place, I wrote an article for the Co-operative party about co-operative insurgency—the idea that a harder, bolder form of co-operation could also come out of a purposeful building out of a co-operative shareholding in business models. To follow my hon. Friend’s idea, it is not only about creating a co-operative or mutual from day one; it can be about mutualising a business model. Even a small, co-operatively held component of a big publicly listed company could help drive and direct an ethos and culture change within that business, which could produce better outcomes for staff and the overall business model.

However, I am afraid that not all is well in our co-operative sector in Plymouth. Our Plymouth credit union is on the verge of closure, which I worry will deny access to finance for people on the margins of finance and society in particular. The City of Plymouth Credit Union’s office is opposite my office, on Frankfort Gate, and at the end of the week, the queues that come out of that credit union show a number of individuals who always face challenges—not only economic and financial challenges but challenges elsewhere. We must also be aware of the closure of credit unions. I do not know what will replace the provision the Plymouth credit union gives to some of those most marginalised people, but we need to find an alternative. The basic bank accounts that the Treasury has been promoting via businesses will not be enough to replace the service provided by Plymouth credit union, and I encourage the Minister to look at what happens when credit unions fail.

[Jim Shannon]

I thank the hon. Gentleman for his excellent contribution. As I said in my contribution, when some of the smaller credit unions closed they were amalgamated with larger ones. Is that a possibility for the credit union that he is discussing?

[Luke Pollard]

I thank the hon. Gentleman for his intervention. I hope that it will be, but I fear it may not. The challenge is that the future is very uncertain, especially for smaller credit unions that do not have the financial backing of a larger credit union. The social benefit that they provide is considerable, and it is worth the Treasury looking at that.

My final point is a challenge to those people who speak about co-operatives and mutuals, like myself and everyone in this place. Often the debate around co-operatives and mutuals is an urban-themed one; as an MP for a city, most of my examples have been urban themed. However, there is enormous potential in telling the story of the success of the mutuals and co-operatives in our rural and coastal communities. In our rural communities, we see an amazing penetration of successful co-operative businesses, providing support at scale not only for rural housing and, in particular, agriculture, as we heard from the hon. Member for Strangford (Jim Shannon), but for fishing. Greenhook Fishing in Plymouth is our brand-new co-operative. It is pioneering sail-powered fishing in Plymouth, and is bringing back the Plymouth Hooker, a fantastic old-style fishing boat. It also provides opportunities for people who have left prison and veterans to be re-trained in new skills, not only in boat construction but in fishing.

Greenhook Fishing is following a model that is present in many other coastal communities and rural communities —of co-operatives being successful, getting on with it and never identifying as a co-operative. My challenge to those who speak about co-operatives is that we should talk up rural and coastal co-operatives as well. I am very pleased that the Co-operative party has started a new commission around rural co-operatives, to feed into Labour’s rural review, that will make the case for further investment in rural co-operatives as distinct from urban co-operatives and the challenges that they face. The future is bright for mutuals and co-operatives, and I look forward to hearing the Minister’s response.

[Dame Angela Eagle (in the Chair)]

I now call the Front-Benchers, beginning with Chris Stephens.

10:22

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to see you in the Chair, Dame Angela. I thank the hon. Member for Wycombe (Mr Baker) for leading the debate. I want to touch on the importance of the co-operative sector in Scotland, particularly in community energy, and the key role co-operatives will have in ensuring that we meet our net zero targets. I am keen to speak about that later.

First, I should declare my membership of Glasgow Credit Union, which is the largest and most successful credit union in the UK, with over 50,000 members. It was formed in 1989 by workers at what was then Glasgow District Council, and it has moved on and flourished from there. I thank the Greater Govan Credit Union, Pollok Credit Union, Vale of Leven Credit Union and Penilee Credit Union for their work on behalf of Glasgow South West constituents. Joining a credit union was by far and away one of the best financial decisions that I have ever made, and I know that many constituents and many people across the UK feel the same way.

The Minister will know that I have championed the credit union sector cause. To help it grow, I hope that he will join me in pushing the Prudential Regulation Authority to consider changing the capital requirements for credit unions. Successful credit unions appear to be getting punished if their assets rise above £10 million. I know that the Minister has some sympathy with that point, and I look forward to some positive comments about the credit union sector.

Co-operatives and mutuals can help develop communities and the economy. Co-operatives are a form of business owned and run by members. In the UK, co-operatives operate under various governance models and legal forms, including workers co-operatives, multi-stakeholder co-operatives, community benefit societies, community interest companies. It is interesting that they have existed in the modern form since 1844, when cotton mill workers in Rochdale formed the Rochdale Society of Equitable Pioneers to buy goods at lower prices. That example lives on in Glasgow South West, with the creation of the Threehills community supermarket, which is now starting to operate. That has become a very successful model.

The Financial Conduct Authority, of course, holds a public register of major societies, and Co-operatives UK publishes a report each year about the scale of the sector; the 2021 report is quite interesting reading. It noted that there were 7,200 co-ops, employing 250,000 people, with a combined turnover of £39.7 billion, and ranging in size from large retailers, such as the Co-op, to credit unions, farmers’ associations, and, of course, community pubs—what a fantastic idea they are, too. Interestingly, the report argues that co-ops appear to be much more resilient to the challenges brought by covid-19 and, indeed, their coming out in support of their members was a factor in that achievement. Perhaps more interestingly, the report also notes more ambitions and optimism about the future from co-ops than among other small businesses.

In Scotland, Scottish Enterprise, through Co-operative Development Scotland, supports company growth through co-operative models, which can protect community services that bring benefits to the local economy. It helps businesses and community enterprises grow by offering advice and services, including free masterclasses and one-to-one support. A community co-operative is a democratic values-led business model, in which community members come together to buy and run an asset for the benefit of local residents. Typical assets in Scotland include wind turbines, hydro schemes, shops, and pubs, among other things.

The Scottish Government have made strong progress towards community energy, including through co-operatives. They recognise that local energy cannot be delivered in isolation; it must develop alongside, and within, a vibrant national energy network. Both are crucial to ensuring that we transition to a net zero future by 2045 in a way that delivers secure, affordable and clean energy for ususb all.

The Scottish Government established their flagship community and renewable energy scheme—or CARES—with the aim of supporting and growing community and local energy projects throughout Scotland, as well as aiming for a considerable increase in the number of shared-ownership energy installations across the country. The scheme is open to a host of different groups and organisations, including bencoms and co-operatives, community groups, faith groups, housing associations, local authorities, national and regional non-profit organisations and rural small businesses.

The Scottish Government had a target for 500 MW of community and locally-owned energy by 2020, which was exceeded, so they increased it to 1 GW by 2020 and 2 GW by 2030. Progress towards that target has been positive, but changes in UK Government subsidies—for example, the closure of the feed-in tariff scheme—have undermined that progress. However, we continue to encourage shared ownership models as a means of increasing community-led involvement in commercial projects.

We are committed to helping island communities—a point was also made by the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) about rural and island communities—and we must ensure that they also become carbon neutral. Supporting those carbon neutral islands should be in the vanguard of reaching the net zero emissions targets by 2045.

As we move towards recovery from the pandemic, greater focus and priority must be given to decarbonisation as a driver for community-led action. New opportunities for communities will arise in the shift towards more localised energy solutions, giving more influence and choice and, in doing so, improving the quality of life for those living here.

10:29

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

It is a pleasure to serve under you, Dame Angela. I am standing in today for the shadow Minister, who has other business in the House. I thank the shadow Secretary of State for Business and Industrial Strategy, my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds), for his help in advance of this debate.

I am delighted to have this opportunity to make the case for co-operatives and mutual societies, which give us a greater say and stake in the institutions that affect our lives and play such an important role in improving equality and productivity at work. I thank the hon. Member for Wycombe (Mr Baker) for bringing forward this debate. I think it is fair to say that I have not always seen eye to eye with him on every debate in this House, but I am pleased to say that in this debate I wholeheartedly agree with him on the importance of mutuals and co-operatives in our economy.

The principles of co-operation and mutual support have roots in small “c” conservative and socialist traditions. The histories of the co-operative movement and the Labour party in this country are closely entwined. Our shared history was referenced several times by people from both sides of the House. My hon. Friend the Member for Neath (Christina Rees) talked about Robert Owen, who was born in her local area. My hon. Friend the Member for Preston (Sir Mark Hendrick) talked about the roots of the modern co-operative movement, which can be traced back to 1844 and the Rochdale Pioneers.

It is no coincidence that the co-operative movement emerged when it did. It was at a time of great industrial upheaval, and people recognised the common bonds that united them and their shared interests. We are approaching a different type of industrial revolution as we decarbonise our economy. As my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard) said, more co-operative ideas and practices are needed to make the best use of our resources, which will be crucial for the green transition.

As many people will know, the Labour party was founded in 1900 at a time of profound change. The Co-operative party was established 17 years later in 1917. In 1924, the two parties entered an electoral agreement to stand joint candidates in elections. We recognise our shared values and commitments to building a society in which power and wealth are fairly shared. My hon. Friend the Member for Plymouth, Sutton and Devonport—I always mention the full title of the constituency because I get annoyed when people call me just “the Member for Hampstead”—talked about the fact that the Members here represent both parties. They are not just extra words on the electoral ballot; it is an instruction for fairness and equality, and I know that a lot of the Members who have made the effort to be here represent both parties in Parliament.

In 2021, our two parties advocate not only for co-operative shops owned by the customers, but for the whole mutual sector. Co-operatives and mutual societies have never been more important for the UK’s economy and public life. The hon. Member for Wycombe talked about more than 7,000 co-operatives operating across the UK with a combined turnover of almost £40 billion. Almost 235,000 people earn their livelihoods directly through co-operatives. Again, the hon. Member talked about the sectors that they trade in, which are as diverse as agriculture, renewable energy, the creative industries, manufacturing, distribution, wholesale, retail and finance.

However, we have seen a decade of rising inequality, low growth and productivity, which has left many businesses poorly prepared for covid-19 hitting us. However, we have seen how co-operatives have proved resilient in the face of hardship. The sector grew by £1.1 billion in 2020, despite the economic challenges resulting from the pandemic.

The resilience of co-operatives is rooted in the higher levels of productivity that can result from employee ownership. In the United States, the National Centre for Employee Ownership tracked the performance of over 57,000 firms and found that employee ownership could greatly improve a business’s productivity and chances of success. This resilience and strength allowed the mutual sector to play such a heroic role during the pandemic by plugging gaps in the Government’s support for communities across the country.

My hon. Friend the Member for Plymouth, Sutton and Devonport, in his whirlwind tour of his constituency, pointed out some of the co-operative ventures in his patch, including Nudge, Plymouth Solar Farm and CATERed—my personal favourite because of my previous role in education—which provides healthy food for children. My hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) talked about Cardiff Co-operative Council, which seems to be carrying out an astonishing number of administrative tasks but also trying to promote more equality in his patch.

I looked up some examples before this speech, including Arla Farmers, which contributed £900,000 litres of long-life milk to the Government’s grocery packs for vulnerable people during lockdown. The Little Pioneers nurseries—again, a personal interest of mine because of my previous role—run by Midcounties Co-operative, kept nurseries near hospitals open and affordable for children of key workers. They also offered additional temporary places for key workers who were unable to rely on their usual childcare arrangements and developed a frontline hero support fund to subsidise fees for key workers’ families.

However, despite the fantastic contribution that co-operatives and mutual societies make to society and the economy, not everyone in the Government has been a friend to the sector. Less than 1% of businesses in the UK are co-operatives. My hon. Friend the Member for Preston and the hon. Member for Wycombe both pointed to Germany’s co-operative economy, which is four times the size of the UK’s. My hon. Friend the Member for Neath talked at great length about Emilia-Romagna in Italy and said that we could learn a lot from that region. Co-operative enterprises generate close to 40% of GDP in that region, and the province has the lowest socio- economic inequality of any region in Europe. I hope to look further at my hon. Friend’s ten-minute rule Bill, which sounds very interesting. I hope that the Minister will pay attention to the details as well.

I agree with my hon. Friend the Member for Preston that if the Government were really serious about levelling up and building back better, they would be looking to learn from other countries about how to expand the sector. Instead, the growth of co-operatives in this country is being held back by a legislative and regulatory framework that is not designed for co-operative businesses. Given their unique structure, co-operatives are often excluded from traditional investments. I hope that the Minister will look at that closely.

I am pleased that the sector has some powerful advocates on the Government Benches, such as the hon. Member for Wycombe, who secured this debate and has spoken on this topic many times, but I wish more Conservatives Members would support him and champion this cause. Under this Government, the number of mutual credit unions has plummeted by more than 20% since 2016—something that the hon. Member for Strangford (Jim Shannon) referenced in his speech. It is ordinary customers who have paid the price, with many forced into the arms of unethical lenders.

I was delighted last week to see members vote to reject the controversial takeover of the insurer LV= by the private equity firm Bain Capital. I want to spend a moment to recognise the work of my hon. Friend the Member for Harrow West (Gareth Thomas), who cannot be here today because of a family emergency. I was in correspondence with him yesterday, and I know how hard he worked to protect the mutual status of this historic firm. I thought it would be remiss of me not to mention him, even though he could not be here. We all know that LV= was founded to ensure that even the poorest people in Victorian Liverpool could afford the dignity of a proper funeral. While we can celebrate the incredible campaign to prevent the sale of this historic mutual institution, the Government must now ensure that it is much harder for organisations to lose their mutual status at the expense of the members they serve.

The sector does so much to boost productivity, fairness and equality, but with the right support I believe it could contribute even more to the UK economy and public life. While the strength of co-operatives and mutual societies rests with their members, the sector will reach its full potential only with a supportive regulatory and legislative framework put in place by the Government. Labour is proud of the achievements of the co-operative movement, and in government we would be even more ambitious about its future. My hon. Friend the Member for Plymouth, Sutton and Devonport talked about how Labour has pledged to double the size of the co-operative and mutual sector. As my hon. Friend the Member for Neath pointed out, the Welsh Labour Government have already made progress on that front.

I will finish by asking the Minister about the vision going forward. The sector has been neglected for a decade. Our great mutual and co-operative institutions have been put at risk of takeover by foreign equity firms, so will he outline his plans to reassure Members who care passionately about this cause that the Government can be trusted with the future of this important sector?

10:38

[The Economic Secretary to the Treasury (John Glen)]

It is a pleasure to serve under you in the Chair, Dame Angela.

I thank my hon. Friend the Member for Wycombe (Mr Baker) for calling today’s debate. As we have heard, he is a strong believer in the transformative capabilities of the co-operative and mutuals sector. He opened the debate with a very reasonable challenge on the drivers and enablers of growth across the different parts of the sector. I will reflect carefully on what he said and examine further the proposals that underlay some of the contributions this morning, but I will also think about what we can do to work with regulators to address those drivers.

I also thank the other Members who have contributed this morning. It has been a fascinating debate, and we have heard about a number of enterprises, across a number of constituencies, that are making a real difference to communities up and down the country. The Government strongly support the co-operative and mutuals sector—not just financial mutuals, which offer mortgages, affordable credit and insurance, but the whole sector across the country. We see it as making a special contribution to society and the economy due to, as Members have said, the focus on the interests of their members in the long term, the democratic nature of those institutions, and their local focus and commitment.

The evidence for that is clear. For example, a recent report from the Association of Financial Mutuals highlighted that mutual insurers serve over 30 million people across the UK, and that contribution deserves recognition. I have recently engaged a number of times with the hon. Member for Harrow West (Gareth Thomas), who is unable to join us this morning, and I recognise that he has brought forward a set of proposals and written to the Chancellor. We will be reflecting on that very carefully. I have received correspondence from LV= subsequent to the vote, and I will continue to update the House on that.

I am a big believer in the power of co-operative institutions of all sizes, from the giant Co-operative Group to High Wycombe Rugby Club and the Chalke Valley Community Hub in my own constituency. It was interesting to hear from the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) about his prolific investments, from the Clipper pub to sail-powered fishing; I am pleased that this forum has perhaps offered him further investment opportunities from my hon. Friend the Member for Wycombe.

The variety of businesses embracing the co-operative model founded by the Rochdale Pioneers almost 200 years ago is something to be championed, and there is much that other sectors can learn from the guiding principles of co-operatives and mutuals. Those organisations can contribute to a new era of responsible capitalism in which financial services, firms and businesses do not just focus on their bottom line, but also on their societal impact. The hon. Member for Cardiff South and Penarth (Stephen Doughty) highlighted a number of examples in his constituency, such as the taxi drivers and the work going on to improve the quality and resilience of the supply of food in schools.

I agree that there is potential for the sector to generate even more prosperity, opportunity and liberty by helping people to take greater control of their lives and finances. Clearly, though, co-operatives and mutuals need strong foundations. In recent years, we have made some significant advances on that front. We have cut the red tape facing the sector through measures such as the Co-operative and Community Benefit Societies Act 2014. We made it easier for such organisations to attract capital, and that supportive approach continued during the pandemic. Co-operatives and other mutuals were not only given access to our financial assistance schemes, but we also took legislative action through the Corporate Insolvency and Governance Act 2020.

Beyond the pandemic, we have reaffirmed our commitment to the co-operative model and the values that underpin it through our £150 million community ownership fund, which supports co-operatives and community-owned businesses to level up the UK by enabling them to take over valuable and viable local assets at risk of closure. The first set of announcements on that were in the recent Budget, and that is across the whole of the United Kingdom. That will mean a minimum of £12.3 million in Scotland, £7.1 million in Wales, and £4.3 million in Northern Ireland. We have announced 21 projects receiving the first tranche of that funding, which I hope will be a significant intervention. Another issue I would like to focus on—to reference the points made by the hon. Member for Neath (Christina Rees) on the Marcora law and her wider engagement with the experience in Italy—was discussed in a previous debate. I am sorry that she was disappointed with the Under Secretary’s response and I look forward to her ten-minute rule Bill in the new year.

However, we need to recognise the difference between the UK and Italian economies, which I think will make the Marcora law less effective here. We cannot subsidise businesses that are predisposed to fail. I remain open to discuss any constructive proposals with her, but Italy has a much higher rate of long-term unemployment than the UK has currently, so it is not clear if providing an advance sum of unemployment benefit would generate savings on welfare spending in the UK, as it may do in Italy. I am sincere in my call to bring forward constructive proposals, appropriate for the UK economy, perhaps drawing on the experience we have seen in Italy.

[Christina Rees]

I thank the Minister for his offer to have further discussions. Can I bring more information about the success of the Marcora law in Italy to share with him at that discussion?

[John Glen]

Absolutely. I sincerely look forward to that and we will engage with the substance of the information.

In my role as Economic Secretary, I would like to focus on the role of mutuals as providers of financial services, because they can play a significant role there. I see these organisations as key to providing people with greater financial stability and therefore greater choice. Indeed, I believe this is levelling up in action.

Credit unions are at the core of this. A few weeks ago, I visited the Glasgow Credit Union that the hon. Member for Glasgow South West (Chris Stephens) mentioned, and a few years ago I visited 1st Class Credit Union in Glasgow. They are two of the largest and most successful credit unions of the 402 that exist across the United Kingdom. The Glasgow Credit Union even offers mortgages, consequential of the deep relationships and bonds it has with its members and its understanding of their financial position. That demonstrates the potential that well-organised, well-supported credit unions can provide in communities.

The hon. Member for Strangford (Jim Shannon) listed the 13 credit unions in his constituency and talked about the distinct tradition that exists in Northern Ireland with respect to credit unions, across multiple sectors. Credit union and co-operative legislation is devolved in Northern Ireland, but I continue to listen carefully to what the hon. Gentleman has to say on this matter.

Affordable finance is key to generating opportunity, wealth and liberty for people around the country.

[Chris Stephens]

The hon. Member for Strangford (Jim Shannon) and I both raised the point about the Prudential Regulation Authority, the work it does and the capital requirements it places on credit unions. Does the Minister have anything to say about that? Can he encourage the PRA to make some changes to help successful credit unions?

[John Glen]

I am extremely grateful for the prompt; one of my kind officials passed me a note on this matter and reminded me that there has been progress in this area. We saw some changes in the way that was delivered last year. In 2020, the PRA implemented a simplified capital regime for credit unions to remove barriers to growth. This created a graduated rate approach, removing the 2% capital buffer and the link between capital requirements, activities and memberships. These changes were broadly welcomed by the sector, but I have committed to continuing to work with the sector further. I hope I will be allowed to introduce legislation next year to address some outstanding concerns that exist within the sector as a whole. I am grateful for the prompt and to the hon. Member for Glasgow South West for raising that matter.

As I said, affordable finance is key to generating opportunity, wealth and liberty for people around the country. We provided £3.8 million to fund the pilot for the no-interest loans scheme, which I have championed over a number of years. The scheme is run by Fair4All Finance, which encourages credit unions and other non-profit lenders to offer these loans. I believe that when this gets through the “proof of concept” phase imminently, it stands to be able to expand significantly. A number of individuals have approached me wanting to support this work, and I look forward to campaigning to broaden that pool on a sound foundation of how it would operate.

We have introduced other changes to help credit unions to generate greater opportunity and wealth for communities. For instance, we introduced and ran a pilot prize-linked savings scheme for credit unions until March this year, which was a real success. Independent research found that it helped to increase positive awareness of credit unions, enabled individual savers to build financial resilience and demonstrated that prize-linked savings be an effective tool in encouraging people to build a nest egg. We have 13 credit unions around the country and the Association of British Credit Unions Ltd currently involved in continuing the scheme, and I hope more will join them in future.

We have also released £96 million of dormant asset funds to Fair4All Finance, to support access to affordable credit products, including those from credit unions. Last Monday, on Second Reading of the Dormant Assets Bill, we introduced the extension of the pool of moneys that will be available from an extended range of financial instruments—£880 million over the next 10 years—which will be for Fair4All Finance to allocate. We will bring forward legislation when parliamentary time allows. That phrase is used a lot, but I am working hard to generate that opportunity in the next Session. It would allow credit unions to offer a wide range of products and services.

I want to spend a moment on building societies, because they are key to unlocking opportunity and driving positive change across the country. For example, in mortgages, Yorkshire and Skipton building societies are among the first institutions to bring back a 95% loan, when there was a problem in the spring, and 95% loan to value mortgages after the lockdown. That obviously brings first-time buyers on to the housing ladder. In addition, the sector is pioneering new products that will decarbonise the UK housing stock. For instance, Nationwide offers a green additional borrowing mortgage, and the Leeds building society has launched two new mortgages for the most energy-efficient homes.

To help building societies continue to flourish, we want to ensure they benefit from an appropriate legislative framework. That is why last week we published a consultation proposing several changes to the Building Societies Act 1986, working with their representatives, to try to provide them with greater flexibility in their funding model, and maintain their key mutual status, which is so important. The consultation also includes proposals to update their corporate framework in line with companies.

[Sir Mark Hendrick]

The Minister has waxed lyrical on the good work that the Government are doing on credit unions and is now touching on building societies. Is he considering changing some of the regulations on demutualisation? As I mentioned earlier to the hon. Member for Wycombe, if we cast our minds back, we will remember that the demutualisations of the past gave a number of those building societies, which were more dependent on mortgage lending, a lot of leverage that made them very vulnerable during the financial crisis. Will the Minister comment on that, and on how he will be proactive in developing the co-operative sector, as well as building societies, through his work on mutuals?

[John Glen]

I mentioned the response we are considering when I talked about the hon. Member for Harrow West and LV=. The reason I am waxing lyrical is that we have genuinely put in place specific interventions across a number of dimensions of the broader sector to ensure that building societies can continue to operate more effectively, offering services that their customers want, and retain their current status. I mentioned the community ownership fund as a source of support for individuals and community groups, encouraging them to form new business models that might be more effective in dealing with their long-term community interest.

I am conscious of the time, but I hope I have illustrated that the Government are committed to supporting mutuals and co-operatives and the unique qualities they provide. Just as those organisations provided opportunity, wealth and liberty to those Rochdale pioneers, we see them as key to strengthening communities, expanding possibilities and increasing prosperity for people today. I look forward to continuing the conversation on specific interventions. As I said to my hon. Friend the Member for Wycombe as I entered the Chamber this morning, it is important that we strike the right balance between hearty aspirations for a healthy sector receiving appropriate consideration of reasonable changes to the rules and regulations underpinning them, and a doe-eyed romanticism about things that are not financially secure in the medium and long term. My job is to interrogate those opportunities and take legislative action where I can, but also to be clear that we have to take a clear, economically valid and reasonable approach to this issue if we are going to have a secure and thriving sector, which I sincerely hope we will.

10:55

[Mr Baker]

I have immensely enjoyed this debate and everybody’s contributions to it. It is an honour to be the person who happened to have their name on the top of the application, so it is with some humility that I speak last. I particularly want to say how much I enjoyed the remarks of my hon. Friend—and on this issue, he certainly is my hon. Friend—the Member for Plymouth, Sutton and Devonport (Luke Pollard). The sheer enthusiasm he has for the contribution of co-operatives to his community said more than any number of statistics that any of us might have cited. That is the reality of co-operatives and mutuals in our society. They are deeply loved institutions, precisely because their members feel part of them: “It is my mutual. It is my co-operative. I am part of it.” I only hope that all of us might aspire to the degree of earnest and heartfelt support for those institutions that the hon. Gentleman has put on record, and I hope he will not mind me embarrassing him by expressing such gushing support.

I am very grateful to my hon. Friend the Minister for what he has said. He has been very clear that the Government want to support mutuals and co-operatives. I will write to him later today with the Co-operatives UK brief, which is quite extensive, and will specifically draw its recommendations to his attention, in the hope that he might be able to take up some that do not conflict with his justified pragmatism and his desire not to be too romantic. I know that my hon. Friend would not want to be accused of an excess of romanticism.

I am extremely grateful for this opportunity to sum up the debate, and to all hon. Members who have spoken. On a day like today, it is a treat to have spoken in unity rather than in division.

[Dame Angela Eagle (in the Chair)]

I think romance is always required in politics.

Question put and agreed to.

Resolved,

That this House has considered the contribution of co-operatives and mutual societies to the economy and public life.

10:57

Sitting suspended.

Post Office Historical Shortfall Scheme

Tuesday 14th December 2021 Westminster Hall

11:00

[Dame Angela Eagle (in the Chair)]

Before we begin, I remind Members that they are expected to wear face coverings when they are not speaking in the debate, in line with current Government guidance and that of the House of Commons Commission. I remind Members that they are asked by the House to have a covid lateral flow test twice a week if coming on to the parliamentary estate. This can be done either at the testing centre in the House or at home. Please also give each other and members of staff space when seated, and when entering and leaving the room.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

I beg to move,

That this House has considered the Post Office Historical Shortfall Scheme.

I am delighted to have the opportunity to serve under you in the Chair, Dame Angela. I welcome the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Mid Norfolk (George Freeman) to his place as a substitute for the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Sutton and Cheam (Paul Scully), who has executive departmental responsibility for this issue.

I have a number of specific concerns about the Post Office’s administration of the historical shortfall scheme, which I will come to in due course, but I want to say something to the Minister and his colleagues in Government. If he takes nothing else away from the debate, I want him to take this away: from assisting constituents in relation to the HSS, it has become apparent to me and, I have no doubt, to others in the House that the culture in the Post Office still leaves a great deal to be desired. It is probably not unique for the Post Office to have a poor culture, but I say that because it has been accepted by Ministers. In fact, it is now a universally accepted truth that what happened in relation to the Horizon scandal was allowed to happen, and happened for as long as it did, because of the culture in the Post Office.

My basic concern is that if the culture is still not right, such a scandal could happen again. This is an opportunity for Ministers. We do not expect them to be responsible for the day-to-day management of the scheme or anything else in the Post Office—there are plenty of people who are rather handsomely paid to do that—but Ministers can and should insist on seeing that there has been a demonstrable change of culture.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I thank the right hon. Gentleman for securing the debate. What he says is absolutely right, and the scheme almost entirely mirrors what we did with Lloyds bank. We asked the bank to mark its own homework in opening a compensation scheme, which proved to be a complete travesty. It has to be completely redone, at a cost of hundreds of millions of pounds to Lloyds, and it has obviously caused massive distress to the victims. Does the right hon. Gentleman agree that the HSS must be done impartially?

[Mr Carmichael]

Yes, of course, although there would not be a cost to the Post Office, because there is only one shareholder—the Secretary of State—so it would ultimately come to the taxpayer. I will touch on that in a few minutes.

[Jim Shannon (Strangford) (DUP)]

Will the right hon. Gentleman give way?

[Mr Carmichael]

Very briefly. This debate is for just half an hour.

[Jim Shannon]

I thank the right hon. Gentleman for giving way. It was not just the fact that the system let people down. It was the mental and physical health issues that people suffered as a result. Some of them ended their lives early, experienced illness or depression, or lost all they had. The implications of all this go far beyond the system.

[Mr Carmichael]

Absolutely. Indeed, as I will come to in a few minutes, my constituent Elena Kimmett, who was for many years the sub-postmistress in Stromness, illustrates truth better than anyone else I can think of.

I thought the question about culture was perhaps just me being a grumpy guy after a bad meeting, as I can occasionally be, but I had a recent lengthy discussion with the National Federation of SubPostmasters. In correspondence to me, the federation put it in the following terms:

“The culture of the Post Office of today and tomorrow must be significantly different to that of the past. In a recent survey of Postmasters conducted by the NFSP, only 29% believe they are being listened to by Post Office today. In terms of resetting the relationship between Post Office and the network, Postmasters gave Post Office a score of 5 out of 10 for their progress so far.”

The executive director with responsibility for the historical shortfall scheme, Declan Salter, was left in a position in July this year where the Post Office board did not renew his contract, and it has still not been renewed. I would like to hear about that from the Minister, either today or in due course in correspondence. It has left the administration of the scheme rudderless. We need to know the intentions of the board. If it is not going to renew the contract of the person it put in charge of the scheme, it should at least come forward and tell us what it intends to do instead.

Throughout this whole sorry affair, the strategy of the Post Office has been to use public money to outgun the sub-postmasters. The settlement with the sub-postmasters was forced on them by the Post Office. That is in the context of the Post Office knowing, by 2013 at the latest, that many of the convictions were unsafe.

[Mr Kevan Jones (North Durham) (Lab)]

I thank the right hon. Gentleman for securing this debate. Does he agree that it is actually worse than that, because the Post Office spent £100 million to defend the indefensible? He said earlier that the Government are the only shareholder. Does that not give rise to the question of what the Government, as shareholder, and Ministers were doing to actually stop the Post Office frittering away £100 million of public money?

[Mr Carmichael]

It does. That has to be examined and established in the fullness of time. That is probably more than we will achieve today. It is still one of the outstanding questions in relation to this issue.

The question of public money being used to defend the indefensible, as the right hon. Gentleman raises, goes to the heart of the way in which the historical shortfall scheme is being administered. That hit me like a bolt of lightning on 23 November, when I was part of the good faith meeting—that is a term of art, not a description of what we actually went through—with representatives from the legal firm acting for the Post Office, Herbert Smith Freehills. I do not know what Herbert Smith Freehills charged the Post Office for that one hour, but the poor lawyer it put forward certainly earned her money in a way she had perhaps not anticipated at the beginning of the meeting. I pick my words with some care, because having checked the Herbert Smith Freehills website earlier today, I see that I was at university with its chief executive. However, I am left feeling that, if the Post Office just paid everybody what they asked for, it would probably end up still better off financially than it has by pursuing it in this way.

Nobody on that call was able to explain the position of the Post Office. We were told right at the start that there would be no recording of this meeting; in a good faith meeting, that seems a quite remarkable way of demonstrating good faith. I know myself, as a former legal practitioner—albeit more than 20 years ago; I would probably know just enough to be dangerous these days—that there are two ways in which lawyers can be used on these occasions. They can be used as an adviser, and indeed as a conduit for good information, or they can be used to insulate the client from the anger of the claimant. It was pretty clear from the Post Office putting nobody up for that so-called good faith meeting that it was the latter, rather than the former.

The meeting involved me and Anne Robertson, principal of JEP Robertson & Son solicitors in Orkney. Incidentally, as someone instructed to administer an estate, she has gone above and beyond anything that anybody could reasonably expect of a solicitor in that situation. Her client is in fact now the estate of the late Elena Kimmett, the postmistress in Stromness from 31 July 1989 until she resigned in October 2008, essentially because she could take no more. I first had contact with Elena in my early days as a Member of Parliament. I started talking about post offices and she got in touch and said, “Well, if you’re interested, come in and see me and I’ll tell you what it’s really like.” And she did.

We all talk about the role of sub-postmasters and sub-postmistresses. Elena Kimmett was somebody who instinctively took enormous pride in the fact that she was part of the Post Office, which allowed her to help so many people, including older people, within the community. She was caught in the Horizon scandal and was absolutely devastated by the apparent disappearance of cash within the new computerised system. She had a long sequence of relatively small losses, which gradually increased, and caused her enormous anxiety.

I have spoken to Elena’s sons about it. They tell me she balanced her books every Wednesday; they well remember the gradual change in her. She went from being a happy, competent, outgoing mother to somebody who was withdrawn, quiet and reserved. On Wednesday night, the balancing night for the post office, instead of coming home for the usual family meal, she started not to want to take part and would instead just eat a few biscuits and have a glass of wine. That is the change that the situation she was going through wrought in her. She was making up the losses from the Horizon system from her own pocket. She asked the Post Office on many occasions for help, but she was always told that the system was infallible and that if money was going missing and it was not her, then it must be her staff. Her staff had all worked for her for long periods of time, and included her mother and husband.

In May 2002, matters came to a head when there was a shortfall of £3,000. She contacted the Post Office again and was told, again, that the system was infallible. She inquired whether other offices were experiencing similar difficulties. She was told no, there were no others and that it was her problem and her responsibility. That was a significant amount of money for Elena and her husband to take from their own savings to put into the business.

Elena eventually gave up the post office in 2008. One year ago today, on 13 December 2020, just six months after she had made an application to the historical shortfall scheme, she died. Her two sons and her former employees have no doubt that Elena’s life was badly affected by the actions of the Post Office—she was devastated, and felt she could not continue in the job that she loved.

That brings me to my questions about the administration of the scheme. My concerns begin with the composition of what is called an application form, but which should properly be regarded as a claim form. The wording of the questions is clearly slanted towards fault and questions actions by employees that are completely unrelated to the employment. The wording actively discourages and gives no space or invitation to specify what the experience of the applicants has been or the effect that it had on them. The application form did not specify that it would be the only opportunity that Elena would be given to state her case. No advice was given that she should seek legal advice before completing and submitting what was a legal claim.

Can we hear from the Minister or the Post Office on who drafted the form? There was no warning whatsoever to applicants that any offer would be considered solely upon and restricted to the amount stated on the form. The form seems to be designed to steer applicants away from any thought of compensation, even to the point of the space given for the response.

The question then arises of consequential loss. There is nothing in the form that would allow for the sort of compensation that Elena should, in law, have been entitled to. The application form asks postmasters to identify any alleged shortfall losses, as well as any other losses that are caused by the Horizon shortfall—namely, consequential loss. That appears to limit any payment to the claimant to proven consequential loss as defined by the Post Office. There is no reference to compensation for anguish, upset or distress caused by its action. There is no reference in the form to any payment. In correspondence to me on 22 October 2021, the Post Office was sympathetic and apologised, but it could not extend the offer on the basis of the information available “at this stage”. Those are the significant words. Having subsequently given it information about Elena Kimmett’s loss, I would have expected it to entertain that, but there appears to be no opportunity for it to do so.

There is a lot more that I could say, but I am aware that others want to make brief interventions and I want to make time available for the Minister to give the fullest possible answers. I will finish with this one final nugget from that good faith meeting on 23 November. When we indicated at the end that we were not content with what we had been told and would not accept the offer, the representative of the solicitors acting for the Post Office turned round and said, “Be aware that if you go to the next stage, it is possible that the sum offered could be reduced or withdrawn completely.” If ever there was a point when we understood the lack of respect that still pertains between the Post Office, its representatives and the sub-postmasters whom we represent, that was it. That was the disgrace. That is why it has to change.

11:16

[Dame Angela Eagle (in the Chair)]

I call Kevan Jones next. I hope to call the Minister at 20 past 11.

[Mr Kevan Jones (North Durham) (Lab)]

I thank the right hon. Member for Orkney and Shetland (Mr Carmichael) for securing this debate today. He talks about culture. I have been involved in the issue for more than 10 years. It was first brought to my notice by Tom Brown, a constituent, who came to me with a similar case. A highly respected individual in the community was suddenly accused by the Post Office of stealing £86,000 because of the Horizon system. He spent two years of hell, and when he went to go before a judge at Newcastle Crown court, he arrived at the door and was told by the Post Office that it was not pursuing the case. In that time, he would have gone bankrupt and paid £86,000 back to the Post Office. In the 10 years in which I have been dealing with his case and many other cases, the culture described by the right hon. Gentleman is spot on. It is arrogant and dismissive. There is a cover-up.

We are now into a scheme that needs to be abolished. It is designed to put the onus back on the individual postmaster and postmistress and to reduce the liability of the Post Office. The scheme was open for only three months in 2020, and if someone did not get their claim in by then, they could not get a claim at all, so that was designed to reduce the numbers and reduce liability. The Post Office has no idea. In its accounts, it budgeted for £35 million of compensation. The figure is now estimated to be more than £300 million.

The scheme also excludes the 555 people, including my constituent, Tom Brown, who took action against the Post Office. We got to the truth only when the case went to court. The Government used £100 million of public money to try to stop the case going forward. They had to settle with the claimants because they ran out of money. There was a tsunami of money from the Post Office. I welcome today’s written ministerial statement about those who were convicted and who can be included in the compensation scheme. However, the scheme needs to be abolished. It should be put to one side. We need a comprehensive scheme outside the Post Office. The Government will have to put in place a scheme for everybody, including the people they have already put forward and including the 555 who took the class action. Without their taking that action, we would not have discovered the lies, deceit and cover-up by the Post Office. I am sorry, I do not accept the Government washing their hands of this and saying that the Post Office is at arm’s length from the Government. They had an active shareholder on that board who did nothing to stop the scandal. I call for the scheme to be scrapped and a comprehensive scheme to be put in place that covers everyone to be compensated. Yes, it might cost hundreds of millions of pounds, but that is because it was not the postmistresses and postmasters’ fault. It was the fault of the Government and the Post Office.

11:20

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)]

I am grateful, Dame Angela, for the chance to serve under your chairmanship. I congratulate hon. Members for their contributions today and the right hon. Member for Orkney and Shetland (Mr Carmichael) for raising the matter. I am here with apologies from the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam (Paul Scully), who has been called into the House on primary legislation elsewhere. However, I relish the chance to respond on behalf of the Department for Business, Energy and Industrial Strategy, having experienced in my constituency the appalling injustice that the sub-postmasters suffered.

In one village in my constituency, Gressenhall, I saw the misery, the family disruption and the hell, as referred to by hon. Members, that the sub-postmasters were put through in a frankly disgraceful episode of institutional contempt for the little guy—if I can put it like that—at the bottom of the system. I am pleased today that, as hon. Members have remarked, we are announcing through a written ministerial statement—there will be an oral statement, subject to the Speaker’s permission, tomorrow—the Government’s commitment to fully fund the historical shortfall scheme and the losses for those who have not yet been compensated.

[Kevin Hollinrake]

The Minister makes a fair point, but so does the right hon. Member for North Durham (Mr Jones). The scheme excludes those who took part in the group litigation. That is entirely unfair and unjust. Lee Castleton, who is not one of my constituents but somebody I have tried to help through a third party, got £28,000 in compensation but he lost more than £400,000. That is simply unfair and that route for compensation cannot persist.

[George Freeman]

I thank my hon. Friend for that intervention. My hon. Friend the Member for Sutton and Cheam is the lead Minister on this matter and I will raise that with him. For the record, I want to make clear what has happened. Those who settled have a settlement. Today, we are tackling the issue of those who were not subject to a settlement. Nevertheless, my hon. Friend makes an important point. This must be fair and it must be seen to be fair.

I want to begin by echoing the Government’s support for the point about culture. It is vital that the painful and difficult lessons from this disgraceful saga are properly learned. Let the message go forth from this Dispatch Box that we expect the Post Office to tackle that culture change properly. I am delighted that there is a culture change programme and two new non-executive directors. However, this is not a tick-box exercise; it is a serious commitment that an organisation wholly owned by the taxpayer delivers properly and learns the lessons from this disgraceful saga. I dealt with the issue when I was a Minister in the Department in the coalition Government in 2015. I saw what seemed to me to be institutional obfuscation and institutional defence of injustice. All those who conspired in that should hang their heads in shame.

The right hon. Member for Orkney and Shetland mentions a law firm. I signal that some lawyers have stepped up to the mark on this and in particular Patrick Green QC at Henderson Chambers, who worked pro bono to help many of the sub-postmasters; Neil Hudgell at Hudgell Solicitors; and Freeths, who did tremendous work speaking up for those who did not have a voice. It is only because of the bravery of those sub-postmasters and their lawyers that we are where we are today.

It is good news that we have announced that funding, but I do not want to focus on that today. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam, has campaigned hard on it and he will speak to the House tomorrow. However, I want to set the record straight on where we are today for those watching or reading this debate. As everyone in the Chamber will be aware, the Post Office introduced the Horizon scheme in early 2000 and subsequently recorded shortfalls in cash at post office branches, which the Post Office then blamed on sub-postmasters—completely unfairly, it subsequently turned out. That resulted in horrific suffering, not just in losses for the small businesses being run by the sub-postmasters, but family losses, divorces, depression, mental health problems and anxiety, not to mention the loss of a facility in many rural areas that is crucial to the community. Many people were sent to prison. That is an absolute disgrace. It is important that the lessons are learned properly and that the culture that conspired to allow that to happen is seriously changed.

In 2017, a group litigation order was brought against the Post Office by the 555 postmasters. The postmasters won two landmark trials in 2019 and reached a settlement with the Post Office for £57.75 million. Those court cases and subsequent cases in the Court of Appeal have demonstrated just how wrong the Post Office was to behave in the way it did. It has apologised, and is now working to overhaul its culture to address the findings of Mr Justice Fraser.

[Mr Kevan Jones]

The postmasters had to settle because they ran out of money. My constituent Tom Brown got £20,000 in compensation; he paid £86,000 back to the Post Office. Can the Minister tell me where that £86,000 is, and why Tom is not entitled to get it back?

[George Freeman]

The right hon. Member makes a really important point. I will raise that specifically with the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam, and perhaps he can address it in his statement tomorrow. On behalf of the Government, I express our deep sympathies to those sub-postmasters mentioned today—to Tom and to those in Scotland, York and around the country. This is an injustice that must urgently be tackled.

[Mr Carmichael]

The best way to demonstrate a change of culture and good faith would be for the Post Office to start the whole process again from the beginning, instead of insisting that people who have made applications under a flawed process will have to see them through to the end and get less than they are entitled to as a consequence.

[George Freeman]

I understand the point that the right hon. Member is making. Let me include, for the record, the history of how we got to this situation. As part of the 2019 settlement, the Post Office committed to putting in place a scheme for those postmasters who were not part of that settlement and did not have criminal convictions related to the Horizon scheme. The historical shortfall scheme was set up to meet that commitment, and it is an important step. It opened in May 2020 and closed to applications later that year.

To be fair, the Post Office made significant efforts—quite rightly—to reach out to all postmasters, sending 7,000 individual letters to current postmasters and a further 20,000 to former postmasters. It is fair to say that the Post Office was quite surprised—I do not think that any of us in this room will have been—by the response. The scheme received over 2,300 eligible applications. I hear the points that the right hon. Member for Orkney and Shetland made about the nature of that form. Because I am not the lead Minister on this, I have not looked at it, but he makes an important point, which I will raise with the Minister. The form needs to make clear to people what they are entitled to and needs not to discourage them from understanding their rights, the enforcement of which is long overdue.

The response to the HSS meant that the cost of the scheme went beyond what the Post Office could afford, and it turned to the Government as its 100% shareholder. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam, has set out that the Government will provide sufficient financial support to the Post Office to ensure that the historical shortfall scheme can proceed properly and that those people are fully compensated. I understand that that raises a question about the fairness for those who settled out of court, which is a point that the Minister will no doubt want to address. The Post Office is contributing from its own funds.

[Kevin Hollinrake]

If the estimate is £300 million and there are 2,300 applications, that is £130,000 each. Lee Castleton got £28,000. The constituent of the right hon. Member for North Durham (Mr Jones) got £20,000. That just cannot be right.

[George Freeman]

My hon. Friend makes a powerful point, which I am sure that the Minister will want to address. I want to mention the question of speed. When the Government step up and say, “We will fully fund this,” it is incumbent on the Post Office to pull its finger out and get on with processing claims more quickly. I understand that the intention is that the vast majority of applications will be claimed within months, by the spring, and all of them will be claimed within the year —and that is long overdue.

I will close by picking up on a couple of the points that hon. Members have made. I will ask the Minister to write to the right hon. Member for Orkney and Shetland about the board. The hon. Member for Strangford (Jim Shannon) made the same points about his constituents. With the right hon. Member for North Durham (Mr Jones), I share the Government’s apologies to Tom Brown and others in his constituency, and I take the point about lessons for Ministers and for the Department for Business, Energy and Industrial Strategy. My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) made a very good point; we cannot have unaccountable quangos marking their own homework, and there are really important lessons about accountability.

It is good news that the Government are making a commitment to fully fund the HSS, but there are other issues that still need to be sorted so that this never happens again and that the injustices are properly resolved.

Question put and agreed to.

11:30

Sitting suspended.

Abortion Services Commissioning: Northern Ireland

Tuesday 14th December 2021 Westminster Hall

[Mark Pritchard in the Chair]

2.30 pm

[Mark Pritchard (in the Chair)]

Before we begin, I remind Members that they are expected to wear face coverings when not speaking in the debate, in line with current Government guidance and that of the House of Commons Commission. Members are asked by the House to have a covid lateral flow test twice a week if coming on to the estate. This can be done either at the testing centre in the House or at home. Please give one another and staff members space when seated and when entering or leaving the room.

In addition, I wish to make a short statement about the sub judice resolution. I have been advised that there are active legal proceedings in the High Court in Belfast between the Society for the Protection of Unborn Children—SPUC Pro-Life Ltd—and the Secretary of State for Northern Ireland and Minister for Health. I am exercising the discretion given to the Chair in respect of the resolution on matters of sub judice to allow full reference to those proceedings, as they concern issues of national importance.

14:31

[Alex Davies-Jones (Pontypridd) (Lab)]

I beg to move,

That this House has considered the commissioning of abortion services in Northern Ireland.

As ever, it is a pleasure to see you in the Chair, Mr Pritchard. I am particularly pleased to lead this debate on a topic that is close to my heart. Members may be aware that I recently left my role as shadow Minister for Northern Ireland to join the shadow Digital, Culture, Media and Sport team. The issues on the ground in Northern Ireland are complex, but this topic was always the one that spoke to me the most during my time in the shadow Northern Ireland team. My successor, my hon. Friend the Member for Gower (Tonia Antoniazzi), will be an equally loud voice for women’s rights, and I wish her well in her new role. I look forward to hearing her comments.

Abortion in Northern Ireland is, as I hope we all recognise, an extremely sensitive and emotive issue that engenders passionate views on both sides. While I always look forward to a good debate, and I would expect nothing less on a topic such as abortion, I hope that Members will be respectful in their contributions. I politely remind colleagues that the focus of this debate should remain the commissioning and delivery of abortion services.

My personal opinion on abortion is clear: it is important that anyone considering an abortion, regardless of where they live, receives impartial, non-directive and clinical information on pregnancy in order to make an informed choice. While some argue that abortion is a devolved matter for Northern Ireland, especially now that the Northern Ireland Executive is able to legislate on this issue, the conformity of the whole UK with the European convention on human rights is a matter for Westminster, not Stormont. The UK Government ultimately have a responsibility for ensuring that all our nations across the UK abide by our international and domestic legal obligations, and that is what brings us to this place today.

We must remember that Northern Ireland has a pro-choice majority when it comes to abortion. A number of Members, including the hon. Members for Foyle (Colum Eastwood), for Belfast South (Claire Hanna) and for North Down (Stephen Farry), and others who represent constituencies in Northern Ireland, are committed to upholding that majority.

I must place on record my gratitude to the many individuals and organisations who have laid the groundwork for today’s debate. The right hon. Member for Basingstoke (Mrs Miller), my hon. Friends the Members for Bristol South (Karin Smyth) and for Walthamstow (Stella Creasy), as well as my right hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson) have spoken on this topic at length. I hope my contribution will do their work some justice. I have also been supported by the team at MSI Reproductive Choices and Women’s Aid Northern Ireland—long may their fantastic work continue.

The changes to abortion laws, which extended abortion rights to the women of Northern Ireland, were made in line with the recommendations made by the UN Committee on the Elimination of Discrimination against Women. Affording women in Northern Ireland these rights was a pivotal step in finally aligning abortion policy across all nations in the United Kingdom, and in my view it was a very welcome move. The legal framework for abortion services in Northern Ireland required under law came into effect in March last year, following an extensive consultation period. The circumstances around the legislation of abortions were clear. During that time, officials engaged with stakeholders, including the Northern Ireland Department of Health, healthcare professionals, the all-Ireland Church Leaders Group, abortion service providers and individuals with personal experience.

The initial regulations were replaced by the Abortion (Northern Ireland) (No. 2) Regulations 2020, which came into effect in May. The regulations, approved by both the House of Commons and the House of Lords, as required by the Northern Ireland (Executive Formation etc) Act 2019, will remain in force in Northern Ireland. These regulations outline the legislation on abortion under any circumstances by a registered doctor, nurse or midwife up to 12 weeks and up to 24 weeks where there is a risk to physical or mental health in the opinion of two registered medical professionals. Thanks to this change, abortions with no gestational limit are also now legal in Northern Ireland, where there is an immediate necessity to save a life or to prevent a grave permanent injury to the physical or mental health of a pregnant woman, or in the case of severe foetal impairment or fatal foetal abnormality.

I had the great privilege of responding to those regulations on behalf of the Opposition in Committee earlier this year. At that time, I and a number of other colleagues spoke about the heartbreaking challenges that many women and girls requiring abortions face thanks to the delays in delivering safe and local abortion services. It would be remiss of me not to pay particular tribute to my hon. Friend the Member for Walthamstow —my good friend—who has led the way in her commitment to women and girls in Northern Ireland. It is only thanks to her amendment to the Northern Ireland (Executive Formation etc) Act 2019—I must add that the amendment was passed overwhelmingly by the House —that the situation changed, in theory, for women and girls. Finally, women and girls would no longer be required to use unsafe, unregulated services or to make the heartbreaking journey across the Irish sea to seek an abortion in Britain. Those changes were a very welcome move and a critical step for women’s rights and, ultimately, equality across Northern Ireland. However, years down the line, these women and girls are still waiting.

I fully recognise concerns around the devolution settlement, especially as a Welsh MP, and I am sure colleagues will want to raise such concerns today. Put simply, however, in the prolonged absence of a functioning Executive in Northern Ireland, it was right that the law was amended to reflect the UK’s human rights obligations. Despite the legislative progress that has been made, we all know that the reality for women seeking abortions in Northern Ireland is fundamentally unchanged. The law simply is not being properly implemented. The Department of Health in Northern Ireland has not commissioned or funded termination services for the purposes of implementing the abortion regulations across Northern Ireland.

According to the Northern Ireland Human Rights Commission, the Department has also failed to issue any guidance to health and social care trusts on the provision of abortion services, including when and in what circumstances medical staff may exercise their freedom of conscience when delivering a service. These are basic asks, and ultimately the Executive must abide by their responsibilities around abortion services, especially since they are now enshrined in law.

When it comes to service delivery, the five health and social care trusts across Northern Ireland simply do not have the resources to uphold their responsibilities. Earlier this year, the health and social care trusts collectively applied for additional funding to meet the new legislative requirements for abortion services, but frustratingly, the Health and Social Care Board did not consider that. Across the trusts, abortions were offered within existing services and only where resources allowed. Staff were transferred from other sexual and reproductive services that were on hold as a consequence of coronavirus. A simple glance at the reality of the situation suggests that that short-term plan is completely inadequate.

Colleagues will be aware of the timeline that various health and social care trusts across Northern Ireland have followed over the last year or so. In October 2020, the Northern Health and Social Care Trust was forced to transfer staff back to other sexual and reproductive healthcare services, meaning that it ceased to take any new referrals for abortion services. At that time, the remaining four trusts were unable to provide abortions for between 10 to 12 weeks, because of the lack of resources.

Just months after the regulations legalising abortion came into effect, barriers were clearly already in place for those requiring support, and that is simply not good enough. It is utterly frustrating that legal action from the Northern Ireland Human Rights Commission was required before any proper action was taken to fix the problem, which persists today.

Colleagues will be aware that in November 2020, the Northern Ireland Human Rights Commission initiated legal action against the Secretary of State, the Northern Ireland Executive and the Department of Health for Northern Ireland for failure to commission and fund abortion services in Northern Ireland. The judgment in that case was finally reached in October this year and, as we all know, the Secretary of State for Northern Ireland, the right hon. Member for Great Yarmouth (Brandon Lewis) was found by the High Court to have failed to uphold his duties to provide full abortion services in Northern Ireland.

Although it is not ordinarily the Opposition’s role to defend the Government—I hope Members will understand that this is a particularly rare exception for me—the failures of Northern Ireland’s Department of Health must be included in the dialogue. We all know that without funding public, services will undoubtedly suffer. That is a fairly basic linear pattern. Without funding or a commissioned framework, health trusts across Northern Ireland simply cannot provide these much-needed services.

In October, the High Court made its will clear—enough is enough. The Secretary of State must work with the Department of Health in Northern Ireland to push it to act. He must act swiftly if he is to comply with the law and stop those who oppose it from denying people access to the abortion process through bureaucratic channels. I am pleased to see that after the legal proceedings were launched, the Secretary of State formally directed Stormont to commission abortion services before the end of March 2022, but the Northern Ireland Human Rights Commission says that the situation has not yet improved. That absolutely must change.

The reality that is often lost in the conversation is that the decision to have an abortion is an emotive one. It is rarely an easy one. The pandemic has undoubtedly had an impact on both the commissioning and the delivery of abortion services in Northern Ireland, and that is understandable to a certain extent. What is not understandable is the cruel effect that delaying the availability of these services is having every day on women and girls in Northern Ireland. Many will have been forced to travel to unfamiliar cities, and at the height of the pandemic they would have had to do so alone, without a consoling hand or a smile to support them during this very difficult time. That is the case thanks to sheer political failure.

My final point, which I am sure other Members will refer to in their remarks, relates to abortion exclusion zones. Freedom of speech and the right to protest is a very important human right, and I know from having spoken on this topic before that there are many Members in this place today who will disagree with my position on abortion. When it comes to exclusion zones, however, I want to highlight the comments made by the Chief Commissioner to the Northern Ireland Human Rights Commission, Alyson Kilpatrick, who said last week that a law to introduce safe access zones outside abortion clinics would not stop pro-life campaigners taking part in public protest.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I congratulate the hon. Lady on securing this timely debate. Does she agree that those who advocate a pro-abortion stance in this debate—which is more appropriately and properly dealt with in the Northern Ireland Assembly —often fail to take account of the plight of the unborn child when they, quite regularly, elucidate and elaborate on the issues affecting women in positions that she has alluded to for the past 10 minutes? Does she understand that there are others involved, such as the unborn child?

[Alex Davies-Jones]

I thank the hon. Member for his contribution to the debate. We do disagree in our personal views on abortion. The full consultation process was carried out. Ultimately, at the heart of this issue are the women and girls who need these services, sometimes desperately. They are being denied their fundamental human rights in law to access these services. Abortion is a personal choice for anyone to make, and those women and girls need to be at the heart of this debate.

The commissioner, Alyson Kilpatrick, was briefing Stormont’s Committee for Health on the Northern Ireland Human Rights Commission’s position on the private Member’s Bill, which seeks to make it illegal to protest or hold demonstrations inside exclusion zones. She said that protesters

“can use the media. They can use various other platforms. They can campaign and protest outside decision-makers’ premises. In fact, the Bill also allows them to protest relatively near to abortion clinics… What it does not allow is for protesters to invade the space and upset, unnecessarily and disproportionately, people who want to avail themselves of the service. They have absolutely every right to say that they disagree, but they do not have a right to impose that on people who are in the process of accessing the service.”

It is therefore vital when debating the situation with abortion services in Northern Ireland that we bear in mind the difficulties that some women and girls face even when those services are available to them.

The commissioning and indeed availability of abortion services is complex. Put simply, every single day that passes denies women and girls the safe, local service they are entitled to. At any time, that would be deemed unacceptable. In a pandemic, it is morally unjustifiable. While it can be dangerous to draw comparisons, I do often consider how the dialogue around other equalities differs from the conversation around abortion. I consider it my duty as an elected representative to challenge these inequalities at every opportunity.

Let me be clear: as someone representing a devolved area, I understand well the sensitivities around the devolution settlement. The balance of our political system relies on the deep respect for devolved powers. Contrary to what other Members may think, I truly believe that that respect is not a contradiction to my overwhelming belief that the United Kingdom is at its best when we work together to uphold fundamental rights. The obligation to uphold said rights lies with this Parliament and this UK Government. Where those rights are denied, as they currently are, the Government have a moral and legal duty to act.

We all need to be honest here. The Northern Ireland Executive are failing women and girls in their obligation and that cannot continue. Quality healthcare and safe, local abortion services are a basic right, and the time to act has long come and gone. For the sake of women and girls in Northern Ireland, it is vital that access to services is commissioned immediately. It is clear that we cannot rely on the Northern Ireland Executive to do so alone. I, therefore, urge the Minister to provide an update on her discussions with the Minister for Health in the Executive. I hope she is able to provide the reassurance that I and so many women and girls in Northern Ireland desperately seek.

[Mark Pritchard (in the Chair)]

Before I call Ian Paisley, will hon. Members please check that their mobile devices are on silent?

14:45

[Ian Paisley (North Antrim) (DUP)]

Thank you, Mr Pritchard, it is an honour to serve under your chairmanship. I congratulate the hon. Member for Pontypridd (Alex Davies-Jones) on bringing the matter to the attention of the House. She is absolutely right that this is a narrow debate on a narrow set of issues. It is not, therefore, about women’s rights, despite the fact that what we have heard today has been padded out with a lot of comments about women’s rights.

It is not, unfortunately, about the rights of the unborn child, whom we should pause to consider, because no one ever speaks up for them. No one ever speaks up for that beating heart in a mother’s womb; no one ever gives voice to that. Today is not about that, unfortunately. Today is about the narrow confines of the rule of law, and where law should properly made.

I am aghast at the irony of today’s debate. We have had a lot of comment about this being the rightful place to make these laws, and how it is not a contradiction to stand as a Member from another devolved region and say that the devolved Assembly in Northern Ireland has no right to make those laws and regulations. When that region is currently in court on these very matters, trying to shape the laws of Northern Ireland, it is the most abhorrent contradiction for this place to try to grasp that power back, and the Assembly in Northern Ireland is on this very day debating some of the issues that pertain to this matter. The irony is not lost on anyone, except the unborn.

[Scott Benton (Blackpool South) (Con)]

I thank my hon. Friend for giving way; he is a great champion for the life of the unborn child, as are all his DUP colleagues. Does he share my concern that the regulations violate the terms of the Northern Ireland Act 1998 and fundamentally dishonour the devolution settlement? That point is particularly appropriate now that Stormont has been restored.

[Ian Paisley]

That was a telling point and absolutely right and proper. Yes, this does dishonour and betray the devolution settlement. There are no two ways about; that is the only want it cuts. When powers are devolved to one region and then it is decided that it is not doing things the way we like, so the powers should be taken back, that is not lost on anyone.

We are not allowed to make up facts in this debate. The myth has been projected today that the majority of people in Northern Ireland agree to and with the most liberal abortion laws in any other part of the United Kingdom. Given that that has never been tested, that statement is erroneous and not factual. Any time the Assembly has voted on such matters over the years, it has taken the other view. Whenever this House has voted on it, the representatives from Northern Ireland who attend this place were divided, but the majority voted against the new regulations as outlined.

We cannot make up the facts and pretend that, because one or two Members support this, all Northern Ireland supports it. That is a myth and one that has to be challenged. Talk to any section of society in Northern Ireland, in the tribal way that Northern Ireland is often caricatured—talk to members of the Roman Catholic faith, members of the Protestant faith, members of no faith—and one will find that the weight of opinion is solidly for the rights of the unborn child. That is the socially conservative society that Northern Ireland actually is.

[Carla Lockhart (Upper Bann) (DUP)]

My hon. Friend makes a valid point. Some 80% of respondents to the consultation on the imposition of the legislation did not want it imposed on Northern Ireland, which completely dispels the myth that the majority of people in Northern Ireland are pro-abortion. In fact, they are pro-life.

[Ian Paisley]

I do not need to make the point, because my hon. Friend has just made it so exceptionally well.

When the regulations were first set in train in July 2019, it was argued in this Parliament that Parliament was duty-bound to pass the amendment that became section 9 because Northern Ireland, it was stated, was in violation of its international human rights obligations under the convention on the elimination of all forms of discrimination against women and the recommendations of the 2018 CEDAW Committee report on Northern Ireland.

However, when ones drills down into that report, the explanatory memorandum to the Abortion (Northern Ireland) Regulations 2021 acknowledges the fact, which the Government now confirm, that paragraphs 85 and 86 of the CEDAW Committee report, which the House rested upon when it made its case in 2019, do not constitute legally binding international obligations. Constantly, those arguing for these liberal laws hang their hat on the false premise that it was an international obligation, when it was no such thing. That myth needs to be dispelled. We should not base our laws upon a lie, and that is what has happened. That is why people are so agitated about what the Government did.

The hon. Member for Pontypridd is right: everyone is entitled to their own opinions on these serious, weighty and emotional matters; however, they and the Government are not entitled to make a pretence that the law was an international obligation that had to be followed when it was no such thing. The Government have now changed their former line of reasoning, arguing that it is the 2019 Act rather than the CEDAW recommendations that requires them to force Stormont to implement the Abortion (Northern Ireland) Regulations 2020 and the 2021 regulations. If ever something has been made perverse, it is the way in which the law is now being argued for.

It is plainly an untenable situation, where non-binding recommendations have been misrepresented to create a binding Act that removes any obligation to and any protection that the unborn child heretofore had. In doing so, the Government leave Northern Ireland in a straitjacket on one of the most sensitive issues that it could ever consider. The UK Government should not have imposed the same law on Northern Ireland that the UN Committee on the Rights of Persons with Disabilities has criticised in respect of the United Kingdom. That committee expressed its concern

“about perceptions in society that stigmatize persons with disabilities…and about the termination of pregnancy at any stage on the basis of fetal impairment.”

By allowing for abortion up to birth—think of it—in cases of non-foetal disabilities such as Down’s syndrome, cleft lip and club foot, the regulations are deeply offensive to the values of Northern Irish people and their politicians.

The House is currently considering a private Member’s Bill that the Government have given fair wind to, introduced by the right hon. Member for North Somerset (Dr Fox), on the rights of children with disabilities. I am honoured to be the secondary sponsor of that Bill. On the one hand, Parliament is trying to introduce laws to protect children with Down’s syndrome, to honour them and to give them their place in society. At the same time, this House says, “Destroy that Down’s syndrome child.” That is what is perverse and wrong, and it is why people are so agitated.

We shall see evidence of that in the latest progress of the Severe Fetal Impairment Abortion (Amendment) Bill, which is being debated as we speak in Stormont. There is a myth that a majority of Northern Ireland politicians are for these liberal laws, when, in fact, the only vote that has taken place in the legislative Assembly since these laws were introduced was on a law to amend them and to remove some of the most horrible liberal policies that affect the unborn. That point, and that sense of irony, is not lost on us.

I welcome the fact of this debate. I also welcome the fact that the Opposition are not here in force today. I think that is surprising, because the Opposition have made a habit of trying to push these matters on to Northern Ireland. I think that, perhaps, under their leader the penny is starting to drop that they cannot keep interfering in the devolution process. They cannot keep saying on the one issue—the Protocol—that they cannot get involved in a debate because they are defending the Belfast agreement, and then the next day come into this place and say, “We want to interfere in the Belfast agreement, set its issues aside, and interfere in a piece of legislation in Northern Ireland.” They cannot have it both ways—that is the message that we send out. This House cannot have it both ways, because that would be obscene and it would be wrong.

Today, I proudly proclaim my defence of, and give my voice to, the unborn. The unborn have a right to life. It is not a health issue to remove the life of an unborn child. It is a moral issue, and this House should have the moral compass to do what is right.

14:56

[Claire Hanna (Belfast South) (SDLP)]

It is a pleasure to serve under your chairmanship, Mr Pritchard, and I thank the hon. Member for Pontypridd (Alex Davies-Jones) for securing this debate. The issue of abortion in Northern Ireland is challenging for many people. Many of us, myself included, have had to go on a real journey of compassion and learning over several years. I am very aware of the sensitivities around it and of the strongly held views. However, it is very clear that there is nobody who this affects more, and nobody that this is more distressing for, than women and girls.

As with many issues over the years that the Executive found too hard to deal with, the changes in Northern Irish law were brought about via interventions from this place from Members of the Opposition. The inadequacy of the previous regulations was very clear for many years. Many women had to go to court and relive the most distressing experiences, in order to build momentum and support for change. This is in many ways a rule of law issue. Despite what other Members have said today, without a plebiscite, we do not know exactly what every single member of the public thinks in Northern Ireland. However, I would be very surprised if any Member could tell me, with a straight face, that a majority of people support the previous provisions under the Offences Against the Person Act 1861, which carried a sanction of up to life imprisonment for those involved in an abortion—regardless of the circumstances.

Whatever people have to say about how they came about, these regulations are the law; this is a rule of law issue and it is entirely inappropriate that these services have yet to be fully commissioned. We are all very much aware of the pressures that the health service and health professionals are under. However, if we are honest, we know that healthcare and health service pressure is not at the core of this issue. We also know that it is not acceptable to duck our responsibilities and force women to travel to Britain—especially in a pandemic.

People know, in their heart of hearts, that to deny these services is simply exporting the issue. They know that this legislation does not actually reduce the number of people who require an abortion; it just has the impact of making a stressful situation even worse for those who are going through it. Despite the pandemic, we know that 371 women and girls still travelled to Britain for abortions, which by law, they should have been able to access in Northern Ireland. We know that many others had to resort to unregulated abortion pills—with all the potential health and legal complications that would result from that.

I am a deep believer in devolution, and it is a matter of regret to me that the Executive failed to commission services in line with their legal obligations. It is also a matter of regret to me that in 23 years, to the best of my knowledge, the Executive have not delivered any piece of equality legislation. Those who believe they are holding some imaginary line should realise that in fact, they are growing the belief among many people in the centre ground in Northern Ireland that the only way they can have the rights and entitlements they wish to have is by changing the constitutional paradigm.

Tomorrow, we will be back in this Chamber discussing the impact of Brexit in Northern Ireland, and there are Members who will rehearse in that debate a very uncompromising position about the need for there to be no divergence whatsoever between Britain and Northern Ireland. As recently as yesterday, the Democratic Unionist party leader repeated his calls to bring down the Assembly over the principle of divergence between Britain and Northern Ireland. The mantra is that there can be no divergence in Northern Ireland—that everybody in Northern Ireland has to have the right to exactly the same sausages as people in Britain have—yet they are willing to fight and stand against people in Northern Ireland having the right to the same healthcare services as those in Britain. The prospect that many more women will be forced to either travel or go to court in order to change the current situation is cruel and distressing.

I will briefly reference the Severe Fetal Impairment Abortion (Amendment) Bill, which in a weird echo is being debated in the Assembly as we speak, and which targets some of the most distressing cases of women seeking an abortion. Those cases are incredibly rare—less than 0.1% of abortions, as I understand it—but that Bill has still invited hours and hours of discussion by MLAs about the plight of those women. By all credible assessments, the Bill is legally incompetent and unlikely to receive Royal Assent. It is found by many disability campaigners to be a fairly cynical and exploitative move that undermines many of the efforts that are being made for people with disabilities, and I believe it is effectively a campaigning opportunity for some people to play out the most distressing experiences in the lives of people who, in nearly all cases, are facing a heartbreaking diagnosis after a much-wanted pregnancy.

The hon. Member for Pontypridd has also referenced the safe spaces—the exclusion zones. While abortion is a conscience matter for the Social Democratic and Labour party, that is a piece of legislation that we are all strongly in support of, and I welcome the ruling of the Human Rights Commission that it does not diminish the right of people to protest if they so wish.

In conclusion, the issue of abortion is not something that I take lightly. I know that many people who have arrived at a different position than I have arrived at come from a place of sincerity and compassion, but I also have no doubt that the decision that many women take requires the same level of compassion and dignity, and it is long past time that we make available the services that the law provides for them. There are clearly wider conversations to be had about how we can improve the circumstances of people who are faced with these sorts of choices, such as more adequately securing people’s belief that the state will meet their needs and support them if they are dealing with a very disabled child, because that is not the case at the moment. I am sure that every Member of this House meets families who are living a hell, given the inadequacy of the services that are provided to their families. Perhaps if those services were more comprehensive, people would not feel that abortion was the best choice for their family.

We also fully support better reproductive services, better education, and better information around relationships and consent in school—all the things that we should do to reduce the number of occasions on which people feel abortion is the only choice for them—but quite clearly, for those who do, that is their choice, and the services should be there to meet that choice.

15:03

[Carla Lockhart (Upper Bann) (DUP)]

It is a matter of deep regret that this House has sought to impose its will above the devolution settlement. At the heart of devolution must lie respect for the areas of legislation that have been determined to fall within the jurisdiction of devolved authorities. In complex and highly charged matters such as abortion, the benefit of the doubt should always be granted to the devolved authorities that they are capable of managing their own affairs.

Both the Abortion (Northern Ireland) Regulations 2020 and the Abortion (Northern Ireland) Regulations 2021 were passed despite the overwhelming majority of MPs representing Northern Ireland who take their seats in Westminster voting against the regulations on both occasions, despite the overwhelming majority of respondents to the consultation on the legislation being opposed to its imposition in Northern Ireland and despite the Assembly being back up and running prior to those regulations becoming law. The very premise for the legislation was flawed, with the claim that intervention was required by Westminster because Northern Ireland was in breach of international law. That claim has been demonstrated to be absolutely wrong—even the explanatory notes for the legislation noted that the CEDAW report recommendations

“are not binding and do not constitute international obligations.”

My hon. Friend the Member for North Antrim (Ian Paisley) eloquently outlined the change that had to be made in the regulations’ explanatory notes to demonstrate that the very foundation on which that law was brought forward was factually incorrect. That is a crazy way to make law—to build it on something that is fundamentally wrong.

The regulations go far beyond what is legally required, as well as beyond the law in England and Wales. They are also discriminatory against those diagnosed with disabilities. A submission to the Secondary Legislation Scrutiny Committee stated:

“Abortion is a sensitive matter throughout the United Kingdom, but no more so than in Northern Ireland to which the Abortion Act 1967 has not been extended”.

The Abortion (Northern Ireland) (No. 2) Regulations 2020

“radically alter the framework for abortion services in Northern Ireland”,

and

“its provisions exceed those already available elsewhere in the UK. For example,”

that includes unconditional access to abortion where

“the pregnancy has not exceeded its 12th week”.

We hear about Northern Ireland’s stance on pro-life and about the number of people who have had to make a difficult journey to GB for access, but we do not often hear about the 100,000 lives who are alive today in Northern Ireland because we did not sign up to the 1967 Act. One hundred thousand lives—people working in our hospitals and the NHS, teachers, and those right throughout our society who are alive today and contributing to society because they were not aborted. Our law values life.

Tragically, the radical regulations permit sex-selective abortion, since the sex of a foetus can be determined through non-invasive prenatal testing. Imagine, baby girls—in the main—being aborted just because they are girls. We call ourselves a progressive society; there is nothing progressive about having a law that allows for babies to be aborted because of their sex.

On the subject of disability, Lord Shinkwin noted during the debate in the other place on the latest version of the abortion regulations imposed on Northern Ireland earlier this year:

“The regulations…threaten me because they challenge that right by devaluing my existence. The narrative of the regulations is that I should not really exist. Indeed, I would be better off dead.”—[Official Report, House of Lords, 28 April 2021; Vol. 811, c. 2271.]

[Paul Girvan (South Antrim) (DUP)]

On that point, on the importance of the unborn and of protection for the unborn, and on the recognition of that in law, whenever we hear of incidents such as the Omagh bombing, when the unborn were killed, they are included in the numbers of the dead. In the incident at Hillsborough, the unborn were included among the dead. I believe that that is the point: they are a life and they are deemed in law to be a life. The recognition is there, and yet now we believe that we can snuff it out.

[Carla Lockhart]

Absolutely. My hon. Friend makes a very valid point. the most basic human right is the right to life and, unfortunately, in our society now the unborn do not have that right. That is not right, and we should not accept it.

As Lord Shinkwin notes, the CEDAW recommendations, one of the great premises on which the law was introduced, expressly prohibit perpetuating stereotypes towards persons with disabilities. The regulations appear to contravene the very recommendations to which they claim to conform. Other Members may be unaware—Members from Northern Ireland have already noted this point in the debate—that proceedings continue in Northern Ireland today, highlighting how unwarranted and extreme these abortion regulations are.

This very afternoon, Members of the Legislative Assembly in Northern Ireland will consider the Severe Fetal Impairment Abortion (Amendment) Bill, a private Member’s Bill brought forward by my good friends and colleagues, MLAs Paul Givan and Christopher Stalford. The Bill seeks to amend the regulations to remove the ground for an abortion in cases of severe foetal impairment.

The Bill passed the second stage in the Northern Ireland Assembly with 48 votes to 12, and was supported by an overwhelming 99.55% of the more than 9,000 submissions to the Northern Ireland Committee for Health consultation. The Bill will now have its consideration stage this afternoon. It goes some way towards meeting the objective of the CEDAW report, on which section 9 of the 2020 regulations is framed—that stereotypes towards persons with disabilities should not be perpetuated. Under the current regulations, babies with entirely non-fatal disabilities, including Down’s syndrome, cleft palate and club foot, can be singled out for abortion in Northern Ireland because of their disability. The provisions allow for them to be aborted right up to birth.

As has been said, we need a society that values people. We see the amazing Bill that has been brought forward for children and young people and people living with Down’s syndrome. We want a society where our legislation values those people and lets them see that we want them to exist and to contribute to society. Our abortion laws allow for them to be aborted up to birth. That tells people with disabilities that their lives are less worthy of protection than the lives of those without disability, and perpetuates deeply unhelpful stereotypes about their quality of life by suggesting that it might be better for them not to have been born.

The regulations matter because they send a clear message that people with disabilities are not equal to others—the Bill being discussed in Northern Ireland today says they are. In England and Wales, where a very similar law is in place, 90% of babies diagnosed with Down’s syndrome before birth are aborted, and we know of women who have been offered multiple terminations of their unborn child, up to a very late stage of pregnancy, because their child has been diagnosed with the disability.

A submission to the Secondary Legislation Scrutiny Committee on the 2021 regulations noted:

“The Committee will recall that the proposals consulted on by the Northern Ireland Office in respect of the 2020 Regulations were rejected by almost 80% of those responding. And yet this breadth of feeling was not reflected in the legislation which subsequently ensued.”

The Severe Fetal Impairment Abortion (Amendment) Bill

“goes some way to begin to redress that democratic deficit.”

The Bill indicates the Assembly’s capacity to legislate for itself on abortion, as well as the disparity between the regulations imposed without consent on Northern Ireland and the views of the majority of the population and their elected representatives. I urge the Government to rethink, to respect the devolution settlement and to allow Stormont the time and space to formulate a made-in and made-for Northern Ireland policy.

Finally, I pick up on a point made by my hon. Friend the Member for East Londonderry (Mr Campbell), who has left early. Never once in this debate is the baby mentioned by the pro-abortion speakers. It is all about the women. I value women. I am a woman myself. I have a baby myself. I value women, but I also value the life of the unborn. As my hon. Friend the Member for North Antrim has said, I am unashamedly pro-life. I will be a voice for the voiceless. We need to get to a point in this society where our laws legislate and create a society that values life and where people can choose life. Yes, we need additional services—I would be the first to say that—to help women who choose life, but I want our laws to value the unborn and value the baby in the womb.

15:14

[Fiona Bruce (Congleton) (Con)]

It is a pleasure to follow the hon. Member for Upper Bann (Carla Lockhart), my co-chair on the pro-life all-party parliamentary group. I commend her for her informed and sensitive speech and for all that she does to be a voice for the unborn in this place.

I rise to speak in this debate to support the right of the Northern Ireland Assembly, representing the people of Northern Ireland, to determine the way forward on abortion—a matter devolved there for some 100 years. I will also highlight the problems arising from the 2020 and 2021 regulations.

I agree that this is a sensitive matter; it is one of fundamental importance in terms of the lives of the unborn, respecting the wishes of the people of Northern Ireland, and respect for the long standing Sewell convention of devolution—that the UK Parliament does not normally legislate in respect of devolved matters without the consent of the devolved legislature. Before I move on to the particular problems of the 2020 and 2021 regulations, I will first refer to two other issues: the Secondary Legislation Scrutiny Committee and the House of Lords Select Committee on the Constitution Abortion (Northern Ireland) Regulations 2021. There were multiple submissions to the Secondary Legislation Scrutiny Committee earlier this year as it considered the Abortion (Northern Ireland) Regulations 2021. Those submissions illustrated the worrying damage that imposing such changes could inflict on the Union. I will quote just one, which says that the Secretary of State’s new powers would

“give him complete control of policies related to abortion and education in Northern Ireland, which are devolved matters. They will take away from the people of Northern Ireland any power to affect any abortion policy the Westminster government choose to impose”,

and that,

“given the current unrest in the province, these measures could do untold damage to the already fragile Northern Ireland Assembly and the Good Friday Agreement.”

Those are profound implications.

I turn to the House of Lords Select Committee on the Constitution, which published a report on the Abortion (Northern Ireland) Regulations 2021 in April highlighting several constitutional issues arising from the regulations. The Committee stated:

“The 2021 Regulations raise an important issue concerning devolved competence. On the one hand the Secretary of State cites a statutory duty, arising from section 9 of the 2019 Act, to make the 2020 and 2021 Regulations… On the other hand, one of the governing parties in the Northern Ireland Executive opposes the Regulations as an unwarranted interference with the devolution arrangements… The prospect of different laws on abortion operating in Northern Ireland would cause substantial legal and political difficulties, and risk undermining the devolution arrangements. We urge the Government and the Northern Ireland Executive to adopt a more constructive approach to resolve this matter.”

I agree.

I now turn in detail to the problems arising from the 2021 and 2020 regulations. Some of these points have been touched on, very eloquently, before; forgive me, Mr Pritchard, if I touch on them again. They are worth repeating. The 2020 regulations allowed the Westminster Government to introduce a completely new abortion framework to Northern Ireland—even broader than the already extremely permissive regulations applicable here. For example, the regulations allow for an abortion, without the need for any ground or reason to be given, for any pregnancy up to 12 weeks. That, effectively, permits sex-selective abortion, as it is now possible to tell the sex of an unborn child between seven and 10 weeks.

Government Ministers here have repeatedly stated that sex selection is not a lawful ground for the termination of pregnancy. When sex-selective abortion was debated in Westminster in 2015, a Minister described it as an “abhorrent practice”. In permitting abortion on demand up to 12 weeks, the regulations go far beyond the law in Great Britain. Indeed, they are even more permissive than required by the CEDAW report, which I will come on to shortly.

The 2021 regulations are even broader, as they deal not only with abortion but with wider issues such as sex education. However, no formal consultation has taken place on the regulations. The Government relied on a mere six-week consultation on the 2020 regulations—six weeks that ran during the general election campaign of 2019 and in the lead-up to Christmas that year.

Then there is the question of the cost of implementing this new framework for abortion in Northern Ireland, which is shrouded in confusion. There was no impact assessment for the 2020 regulations. It appears that the UK Government—the Minister may correct me—have given no indication of how costs will be borne, arguing that this is a matter for the Department of Health in Northern Ireland. However, the Department of Health in Northern Ireland considers this funding to be a matter for the UK Government.

There is the further legal point of controversy as to whether the obligations in the Northern Ireland (Executive Formation etc) Act 2019 were a one-off, so that the 2020 regulations met them, which is the view of the former Attorney General for Northern Ireland, John Larkin QC, or whether those obligations are continuing, which I understand is the view of the Government.

It is critical to remind ourselves, as colleagues have done, that the minor UN CEDAW committee was not the UN speaking as a whole, which was often the impression that we were given when we were discussing the Northern Ireland (Executive Formation etc) Act 2019. Those discussions were far too brief. I remember one important debate on the Bill, on 18 July, that lasted just one hour. On another occasion, if I remember correctly—and I stand to be corrected—we were asked to look at House of Lords amendments in just 17 minutes, which was totally inadequate for the consideration of such important legislation.

That CEDAW committee was not the UN speaking as a whole and, as we have heard, its recommendations are neither binding nor international law. That has been specifically confirmed by the Northern Ireland Office itself in its explanatory memorandum to the Abortion (Northern Ireland) Regulations 2021, which states, with reference to paragraphs 85 and 86 of the CEDAW report:

“In particular, those recommendations are not binding and do not constitute international obligations.”

The whole premise on which we passed the 2019 Act was false.

On the basis of those non-binding recommendations, the Government seek, through the 2021 regulations, to give the Secretary of State sweeping powers to direct not just Ministers but civil servants and health bodies in Northern Ireland to implement a broad abortion framework. That is a far wider group of people and bodies than envisaged by the Northern Ireland Act 1998, which allows the Secretary of State to give direction to Ministers or a Northern Ireland Department only in certain circumstances, namely,

“for the purpose of giving effect to any international obligations”

—and we have agreed today, I hope, that the CEDAW recommendations were not international obligations—or for the purpose of

“safeguarding the interests of defence or national security or of protecting public safety or public order”.

The wide-ranging powers given to the Secretary of State by the 2020 and 2021 regulations cannot be justified on any of those grounds.

I turn now to commissioning. There is no reference to what services might be commissioned in either the 2020 or the 2021 regulations. The regulations are now, as Mr Pritchard has said, the subject of a pending court decision, which makes for a further legal complication. The requirement to commission services under the direction of the Secretary of State may disappear if that legal challenge is successful, leaving a legal loophole. What is particularly concerning about the commissioning, however, is that the regulations do not include any proposed inspection arrangements for premises conducting abortions, whether NHS or private. It would appear that the Northern Ireland Regulation and Quality Improvement Authority has no powers to inspect any premises to compare with those of the Care Quality Commission in England. If that is the case, that omission is doubly concerning when we consider recent reports by the CQC of abortion clinics in England. In the last few weeks, a British Pregnancy Advisory Service clinic in Middlesbrough was rated inadequate after inspectors found that medicines were not stored safely and that systems to protect people from abuse were not “effective”, while a Doncaster BPAS clinic was put into special measures following an inspection. It is essential that proper provision for the inspection and regulation of abortion services is in place in Northern Ireland.

As mentioned, abortion remains a devolved matter that rests with the competency of the Northern Ireland Assembly. The Northern Ireland (Executive Formation and Exercise of Functions) Act 2019—which, in section 9, includes the order-making power under which the regulations were created—was imposed on Northern Ireland at the behest of parliamentarians from other parts of the UK. No Northern Ireland MP in Westminster supported the passing of that Act.

The Northern Ireland Assembly have been up and running for some time. It not only has the legislative competency to act on abortion-related matters but, as we have heard, it is in the process of doing so through the Severe Foetal Impairment Abortion (Amendment) Bill. Respect for the competencies of that Assembly and the devolution settlement surely dictates that all other abortion matters should be determined by the Assembly, particularly since abortion has been a devolved matter for so long.

The Severe Foetal Impairment Abortion (Amendment) Bill seeks to address the discriminatory nature of abortion law implemented in Northern Ireland under regulation 7 of the 2020 regulations, which permits abortion up to birth on the grounds of disability. It is a matter of increasing concern across the UK in terms of its discriminatory aspect, as we heard in the House only two weeks ago in a debate on the proposed Down’s syndrome Bill.

Application of regulation 7 would very much go against the progressive tide of thinking in that respect. The fact that abortion up to birth for serious foetal disability is already in effect in GB is no reason to implement it in Northern Ireland—particularly as it is now considered to be deeply concerning and ill-defined legislation. I know that because my son was born with a club foot. I do not consider that to be a serious disability. We have seen it corrected; no one looking at my son today would know that he had been born with that disability.

Even the CEDAW report on which the regulations rely stated:

“In cases of severe fetal impairment, the Committee aligns itself”

with the UN

“Committee on the Rights of Persons with Disabilities in the condemnation of sex selective and disability selective abortions, both stemming from…negative stereotypes and prejudices towards women and persons with disabilities.”

With great sadness, I conclude that imposing the ill-thought-through and hurried-through regulations would demonstrate a profound lack of respect for the people of Northern Ireland and their elected representatives. As I have repeatedly said in this House—I refer to my remarks on 8 July, 18 July and 9 September 2019, and on 8 January 2020—the hurried handling of the issue of abortion, which is a devolved policy area, and the Northern Ireland (Executive Formation) Act and the subsequent introduction of regulations has been, in my opinion, unconstitutional, undemocratic, legally incoherent and utterly disrespectful to the people of Northern Ireland.

[Mark Pritchard (in the Chair)]

I ask the hon. Member for Strangford (Jim Shannon) to wind up at about 3.38 pm, to allow the Front-Bench Members 10 minutes each.

15:29

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in the debate on an issue that is very close to my heart. I will replicate the opinions of my colleagues and of the hon. Member for Congleton (Fiona Bruce). I am my party’s health spokesperson. As a Northern Ireland MP—I was born and bred there and I still live there—I have listened to the views of those around me: of women and men; of young and old; of those who are affected by the meddling of this House in one area and cry out for help in other areas, only to be told that the issues are devolved. There is no justification for interference in the devolved settlement in Northern Ireland in this matter.

The Abortion (Northern Ireland) Regulations 2021 conferred egregiously wide powers on the Secretary of State to

“direct a Northern Ireland Minister, a Northern Ireland department, the Health and Social Care Board and the Public Health Agency to take any action capable of being taken that is required for the purpose of implementing the recommendations in paragraphs 85 and 86”

of the CEDAW report. The regulations note that the Secretary of State will have powers to direct any “relevant person” to take any action that they are capable of for the purpose implementing the recommendations in paragraphs 85 and 86 of the CEDAW report. It is not clear that Parliament intended to allow such wide-ranging powers to be created, given the obligations voted on in section 9 of the Northern Ireland (Executive Formation etc) Act 2019, which outlines such powers as applying to Ministers and Northern Ireland Departments only, while the 2021 regulations extend these powers to direct public health organisations.

That sets a dangerous precedent for commissioning on a devolved issue. There is no clear limit to the sweeping powers granted to the Secretary of State; they are potentially indefinite. The Northern Ireland Office states that

“the statutory duty imposed on the Secretary of State by section 9 of the NIEF Act is such that until all of the recommendations in the CEDAW Report are implemented in Northern Ireland, he will not have complied with his statutory duties in full.”

That is very concerning and very worrying. These are wide-ranging powers across a spectrum of issues that extends well beyond abortion. The list under paragraph 86 of the CEDAW report, for example, also includes sex education. The powers taken by the Secretary of State in the 2021 regulations allow the UK Government to override Stormont on devolved issues on an ongoing basis, even though the Assembly is functioning. We may not like all the things happening at the Assembly, but it is a functioning Assembly and it has a cross-section of political support in Northern Ireland.

Notably, consent for constitutional change is one of the fundamental principles of the 2005 St Andrews agreement, which restored the political institutions of Northern Ireland in July 2006. The radical abortion amendment to the 2019 Act has not received the consent of the Northern Ireland Assembly. Repeatedly laying these statutory instruments glosses over the deeper issues related to devolution and that abortion is devolved to Northern Ireland, but seemingly now in name only.

Abortion is an immensely sensitive issue in Northern Ireland, a place where both lives matter—both the life of the pregnant woman and the life of the unborn child, the baby yet to be born. It is an issue that crosses the bounds of political persuasion, class or creed. At the walk for life at Stormont, which I was happy to attend with my hon. Friend the Member for Upper Bann (Carla Lockhart), I stood shoulder to shoulder with nationalists, Alliance voters and Unionists alike. We rose above the politics because life matters, including the life of the unborn baby. I was thankful for the thousands and thousands who came out to respectfully plead that we did not implement the most liberal abortion laws in Europe, to no avail.

I respect the hon. Member for Pontypridd (Alex Davies-Jones)—she knows that, I spoke to her beforehand—and I want to be respectful to everyone because it is my nature to be so. With that in mind, I say this. The hon. Lady referred to consensus. First, back on 2 June 2020, 75 of the 90 Members of the Legislative Assembly demonstrated cross-community opposition to the imposition of abortion legislation that discriminated against those with non-fatal disabilities, including Down’s syndrome, and an absolute majority voted specifically against the imposition of abortion regulations that allow disability discrimination, as the 2021 regulations have done. Secondly, I am aware of a poll earlier this year that indicated that 60% of the people of Northern Ireland were against abortion on demand for any purpose. Those are two reasons why the consensus that the hon. Lady referred to does not hold up.

Thirdly, a poll by the University of Liverpool and Britain’s Economic and Social Research Council showed that only 5% of the public in Northern Ireland support introducing abortion up to 24 weeks, which is what the UK Government implemented through their regulations. Fourthly—my hon. Friend the Member for Upper Bann made this point, but it is important that I put on the record that I feel the same; it has never been contradicted, and indeed has been enhanced—it has been reported that an estimated 100,000 people would likely not be alive today had Northern Ireland been subject to the same drastic expansion of abortion legislation as the rest of the UK has experienced since the Abortion Act 1967. With abortion on demand, those people would not have jobs and would not be contributing to society. I thought that was a very salient tale of just how important that is.

In effect, it seems that abortion in Northern Ireland has become a reserved matter, predicated on the consent of Westminster, and by extension, the CEDAW recommendations, rather than a devolved matter of full legislative control as before 2019. In the last two days, from my constituents in Strangford, I have been contacted with some 400 emails on this issue—I say that honestly. How many emails have I had in favour of abortion in the last six months? Three. Three in favour of abortion, and 400 in the last few days. Indeed, in those six months, thousands spoke against it.

I want to reflect the opinion of those in Strangford and across Northern Ireland. I am very proud to represent everyone on this issue, and people do take the time to come and tell me their views. I have had nationalists come to my office who pleaded with me to stand firm against this most liberal abortion regime in the world. The case is clear. The majority are against abortion.

One of my constituents tells me that she emailed one Member of the House who has spoken out passionately, telling this House that she spoke for the women of Northern Ireland. I will not shame anybody, because that is not what I do, but my constituent, who wrote to that Member and asked her to represent her, is still waiting for a reply. There is a pick-and-choose when it comes to Northern Ireland that goes from Government right down to individual Members. I am not picking and choosing. I can speak with authority and say with certainty that the overwhelming majority of those who have contacted me are appalled at this legislation. They are appalled that the wishes of a cross-section of the Assembly have been ignored by the Government. They are appalled that the legislation means that a reason for taking a life at 27 weeks can be a cleft lip. Does anyone really think that that reason could be condoned legislatively or in any other way?

My hon. Friend the Member for Upper Bann speaks with passion, compassion and sense, and I commend her for that. My voice should not carry any less weight because I am a man. I speak for my constituents—male and female, young and old. I represent them very well, I believe, and I am fervently urging Members to consider what they are asking to be implemented expressly against the democratic will of the people of the Province.

There is coming a day shortly when the day-to-day business of Northern Ireland could well be the responsibility of this House, and all decisions could be made here, but not now and not at this time. Today is not that day. It is the place of the Northern Ireland Assembly to make a decision on abortion. It should be up to Assembly Members to respect them. They should be respecting the thousands upon thousands of my constituents who say that they do not want abortion on demand, that they want to speak up for the unborn and, above all, to respect life. The life of the unborn baby is so important to all of us.

15:37

[Tonia Antoniazzi (Gower) (Lab)]

It is a pleasure to serve under your chairship, Mr Pritchard. I congratulate my hon. Friend the Member for Pontypridd (Alex Davies-Jones) on securing this timely debate on the commissioning of abortion services in Northern Ireland. I am proud of her work, as my predecessor, for women and girls in Northern Ireland. I will endeavour to do all that I can to support them.

At the beginning of my parliamentary career, I worked as Parliamentary Private Secretary to the shadow Northern Ireland team and was a member of the Women and Equalities Committee. This afforded me the opportunities to work with colleagues in Northern Ireland and to have a greater insight into the inequality of women in Northern Ireland compared with the rest of the UK. I had the opportunity to meet the hon. Member for Belfast South (Claire Hanna) before she was in this place. I remember the conversation well. She spoke today about compassion and learning and that this issue is a journey. I think we all understand what a journey it is for women in Northern Ireland.

Being part of the Women and Equalities Committee when it did the report on abortion law in Northern Ireland gave me an in-depth view of the change that was needed to move forward. I pay tribute to all the organisations and politicians who spoke to us. Moreover, I pay tribute to the women who shared their deeply personal experiences with us as well.

The standpoint of the Labour Front Bench is that these women should have the right to make an informed choice. Any woman who suffers a loss or makes a decision to end a pregnancy should have support services available to them. I was very dismayed to hear that there is an 80% increase in need, and limited funding means that women have got up to a six month waiting list for support. How can this be acceptable in 2021?

I have listened to all of the speakers in today’s debate. It is important that we all understand and are respectful of each other’s views. I was brought up a Roman Catholic and my father was the deputy head of a Roman Catholic school. I had that one-sided view of the right to life. However, as a woman and having been in education for 20 years, I have seen at first hand the pain that girls and women have had to go through. That is why those services are so important. As my hon. Friend the Member for Pontypridd outlined at the start, this is not a debate about the mechanics of devolution; it is a debate about the rights and the duty of this Parliament to uphold the rights of citizens across the United Kingdom. The law is clear: we need to get on with delivering those services.

The hon. Member for North Antrim (Ian Paisley) and the hon. Member for Strangford (Jim Shannon) talked about the views of the people in Northern Ireland. I want to draw their attention to an Amnesty International poll, done by an independent research company in 2020, which

“demonstrates an overwhelming demand for change to Northern Ireland’s draconian abortion laws.”

It is important that we are fair, just and transparent about the data that is out there on the views of people in Northern Ireland.

As my hon. Friend the Member for Pontypridd explained in her excellent speech, the changes to abortion laws extended abortion rights to the women of Northern Ireland. They were made in line with the recommendations of the UN Committee on the Elimination of Discrimination against Women and affording women in Northern Ireland those rights was about aligning abortion policy across the United Kingdom. It was a key moment for us, but little has changed since March 2020 for women in Northern Ireland. This is the title of the debate, and the lack of the commissioning of abortion services in Northern Ireland is having a direct impact on women.

The debate is about the rights of women in Northern Ireland and their right to access basic reproductive healthcare without needless barriers. It is about their right to clear, accurate and impartial advice and guidance about their healthcare choices. There is a worrying lack of impartial guidance, if any guidance at all, on a woman’s right to choice when she finds out she is pregnant. The GP should be women’s first port of call and they do not always get the advice they need there. When women turn to the internet and google abortion services in Northern Ireland, they are led to services that put in delaying tactics, making it impossible for them to terminate their pregnancy if they wish to. It also forces more and more women to purchase abortion pills online. We should not be in that situation. Fortunately, those women are not living in fear of prosecution now when they use that service.

[Ian Paisley]

Will the hon. Lady give way?

[Tonia Antoniazzi]

Unfortunately, I need the time.

The lack of commissioning means that Informing Choices NI has had to withdraw its central access point and BPAS has had to come in to support it as well. Women have a right to have high-quality access services as early as possible and as late as necessary and those rights are currently denied to women because of the inaction of the Northern Ireland Executive, the Department of Health in Northern Ireland and the Secretary of State. It has been nearly two years since those essential services should have been made routinely available in Northern Ireland, but as colleagues have said, the reality for many women is that the change in legislation might as well not have happened.

The lack of funding or a commissioning framework has led to piecemeal service provision, with women’s access dictated by their postcode. Women in the Western Health and Social Care Trust area have had not access to services in nine months and they cannot go to another trust to access services, having to pay nearly €500 privately to go to Ireland or to England and access pills online if it is not too late. What should be a service for all becomes a service for a lucky few: those who can take a hit to their income, take a day off work or travel the hours to access healthcare. That is not fair. The impact of covid has also been felt in service provision and in the travel restrictions.

The reality for women in Northern Ireland is that access to basic healthcare rights is in no way guaranteed. Will the Minister and the Secretary of State for Northern Ireland meet me to discuss an immediate way in which the Government can address the current crisis for women in Northern Ireland? What additional measures will the Executive put in place, especially in light of the new covid variant omicron, to ensure that the provision will be extended and maintained into the new year?

I look forward to hearing what the Minister has to say, because this is a very important issue for women and girls in Northern Ireland.

15:45

[The Parliamentary Under-Secretary of State for Health and Social Care (Maria Caulfield)]

I am grateful to the hon. Member for Pontypridd (Alex Davies-Jones) for securing the debate. The Northern Ireland Office Ministers regret that they are unable to be here today, but I am sure they welcome the opportunity to have this debate and hear the wide-ranging views on abortion in Northern Ireland. It is an extremely emotive and sensitive subject and it is important that we have that debate in this place.

It is now more than two years since the Northern Ireland (Executive Formation etc) Act 2019 was passed, where Parliament stepped in and decided that women in Northern Ireland should have access to the same healthcare rights as women in England, Scotland and Wales. Even though the law was changed two years ago, it is true that services have not been commissioned in full.

The Northern Ireland (Executive Formation etc) Act placed a duty on the Secretary of State for Northern Ireland to ensure that abortion services which meet the recommendations are put in place and implemented. He has a legal duty to uphold that. As we have heard today, it is true that women have to access abortion in the rest of Great Britain, even though early medical abortion is available in four of the five trusts in Northern Ireland and BPAS has stepped in to provide an interim referral service for women and girls on a temporary basis.

Women and girls who require surgical abortions and post-10 week abortions still have to travel to Britain. The only way for the legal obligations to be met is through local commissioning. The Secretary of State has been clear with the Northern Ireland Department of Health and the Northern Ireland Executive about the commissioning of abortion services that are consistent with the regulations passed in 2019. Despite continuous engagement by the Secretary of State, he remains frustrated that progress is not being made.

As a result of the ongoing delay in commissioning services specifically by the Department of Health and the Northern Ireland Executive, Members will be aware that in July this year, the Secretary of State issued a direction to the Northern Ireland Department of Health, the Minister of Health, and the Health and Social Care Board to commission and make abortion services available by no later than 31 March 2022.

[Ian Paisley]

I thank the Minister for giving way because that point is absolutely vital. By the Secretary of State recommending to the Minister in Northern Ireland that he commission these services, is that not an acceptance that these services are devolved matters? Conversely, matters that are reserved, such as the protocol, can be debated here—and posed and changed here—if that is the Government’s position. If the Government’s position is that this matter is devolved, it should remain devolved.

[Maria Caulfield]

I thank the hon. Member. I was going to come on to the point he raised in his remarks, but will touch on it now, if I may. Health is a devolved matter and that is very much recognised. It was frustrating. It was a free vote, and he knows how I voted and I would do the same today. However, at the time, there was no functioning Assembly. This Parliament had to make decisions, not just on this issue, but other issues such as budgetary matters. As a member of the Northern Ireland Affairs Committee at the time, I remember making the case to MLAs that this was why it was so important to get the Assembly up and running, because decisions were made in this place that did not reflect and respect devolution. Decisions were having to be made in this place on devolved matters.

[Colum Eastwood (Foyle) (SDLP)]

I totally agree that this is a very sensitive issue and there are strongly held views on it, but it is as if we are sometimes speaking in a vacuum. Yes, there was a political vacuum in Northern Ireland when the law was made, but there was also an issue around the law, where the High Court clearly stated in the Sarah Ewart case that the Northern Ireland Executive were falling foul of the law in terms of human rights protections around fatal foetal abnormality and sexual assault.

Whatever people might think about the law that this place brought in, the Northern Ireland Executive did not bring in a law to deal with that issue. Nobody that I have heard who opposes the law here has come up with a solution to deal with the fact that Sarah Ewart and many other women were forced, when the baby was not able to be born or to survive, to carry to full term. Those people were left without any recourse by our Northern Ireland Executive, so it is all very well talking about devolution and everything else, but when responsibility lay with the Northern Ireland Executive, they did not lift the ball, did not deal with it and left women, such as Sarah Ewart, in a very invidious position.

[Maria Caulfield]

We are left with the law that was passed in 2019, so the Secretary of State is now under a legal duty to implement it. He has directed the First Minister and the Deputy First Minister to include it on the agenda for the Executive Committee. That is not taken lightly because, while I understand the points the hon. Gentleman has just made, health is a devolved matter, but the UK Government have to uphold their legal duties in terms of the decision.

The Secretary of State for Northern Ireland has taken the decision in line with his statutory duty. He recognises that it is an unprecedented step, but it was taken after allowing a year for the commissioning of services since the Northern Ireland Office provided a framework in spring 2020. The Secretary of State has clearly stated that fully commissioned services must be provided by March next year. If it becomes clear before that deadline that the Department of Health, or indeed the Northern Ireland Executive, are not making progress, he will have to take further steps to ensure that his legal duties are upheld.

I know that I am running out of time, but I will just follow up on a couple of comments. The hon. Member for Pontypridd asked about progress, and I hope that I have set out that the Secretary of State has set the deadline of March and is monitoring progress closely. On the issue of exclusion zones, my understanding is that there is a Bill before the Assembly, brought forward by an MLA, that is being debated on that very issue, and in terms of devolution, the decision will be made there.

On the importance of devolution, which was raised by my hon. Friend the Member for Congleton (Fiona Bruce) and hon. Members for North Antrim (Ian Paisley), for Strangford (Jim Shannon) and for Upper Bann (Carla Lockhart), absolutely, health is a devolved matter and these decisions are devolved for a reason. My plea to MLAs now is the same as when I was on the Back Benches in 2019 and being forced to make these decisions: however fragile the Assembly is, it is important that it keeps going so it can make these devolved decisions. Colleagues have set out clearly the importance of that, which I recognise.

The Secretary of State has said that he is committed to continuing to work closely with colleagues and stakeholders in Northern Ireland. It has always been our position that these services should be delivered locally. I am grateful to all hon. Members. I know that this is a sensitive and difficult issue to debate, but I thank everyone for debating it in such a sensitive and respectful manner. With that, I draw my remarks to a close.

00:04

[Alex Davies-Jones]

It has been a privilege to take part in today’s debate and have the opportunity to speak up on behalf of women in need of abortion care in Northern Ireland. I am grateful for the contributions of colleagues from across the House, and although I recognise that some of us are unlikely to ever reach a consensus on the issue, it has been good to see that the debate has been mutually respectful. I particularly welcome the comments from my hon. Friend the Member for Belfast South (Claire Hanna), who spoke passionately about the need to have women and girls at the heart of the issue, and we need to uphold and make available their legal right to local services for a safe abortion.

The central theme of the debate has been choice. In law, women in Northern Ireland have the right to choose, but that is meaningless without access to safe, local abortion services. We have been debating the issue of access to abortion in Northern Ireland for years, and it is simply past the time for action to take place. With that in mind, I welcome the Minister’s reiteration of the Secretary of State’s commitment to bring this in by 31 March 2022 to ensure that the legal duty is upheld.

While I am no longer the shadow Minister for Northern Ireland, I am pleased to have passed the brief into the capable hands of my hon. Friend the Member for Gower (Tonia Antoniazzi). I will closely scrutinise the Government’s work on the issue, and I urge the Minister and the Secretary of State to work to meet the needs of women in Northern Ireland without delay.

Question put and agreed to.

Resolved,

That this House has considered the commissioning of abortion services in Northern Ireland.

00:05

Sitting suspended.

Greenwashing in Finance

Tuesday 14th December 2021 Westminster Hall

[Sir Edward Leigh in the Chair]

[Relevant documents: Thirteenth Report of the Treasury Committee, Session 2019-21, Net Zero and the Future of Green Finance, HC 147; and the Government Response, Session 2021-22, HC 576, and Oral evidence taken before the Treasury Committee on 8 December 2021, Work of the FCA, HC 146.]

14:30

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I beg to move,

That this House has considered tackling greenwashing in finance.

It is a pleasure to serve under your chairmanship, Sir Edward. I am grateful to my hon. Friend the Member for Kensington (Felicity Buchan), who has passed responsibility for this debate to me as she is unable to attend. Subject to the House’s confirmation this evening, I am happy to say that I will replace her on the Treasury Committee, where she has done such fine work.

On the face of it, greenwashing sounds pretty trivial. The Treasury Committee provides a lot of very interesting information on the subject in its report of April 2021. Chris Cummings of the Investment Association described it to the Committee as

“finding something that looks a bit green and promoting it as a green success story”.

People may say, “Well, companies do that all the time, don’t they? They exaggerate their marketing claims and it doesn’t sound like too big a problem.” But, unchecked, it is a massive problem because finance has a huge role to play in decarbonising our whole economy, not just the financial part of it.

I will give some useful examples of greenwashing. BP got into trouble a year or two ago for promoting its green credentials by saying that it was putting solar panels on all its service stations. The reality, however, is that at that time BP was 96% focused on oil and gas exploration in its investment and economic activity. I very much hope—and I am sure that this will be the case—that BP will decarbonise its organisation over the coming years. Nevertheless, its claim can clearly be described as greenwashing.

McDonald’s said that it had moved from plastic to paper straws. However, the paper straws were not recyclable, and neither were many of the containers used in its products. Coca-Cola claimed to be one of the most environmentally friendly organisations on the planet, yet it is the No.1 plastic polluter on the planet. We need to ensure that there is clear evidence about which companies are green and which are not.

Of course, all these companies form part of the investment strategy for many of the important fund managers for which the UK is famous. Tracker funds are particularly popular among investors, particularly unsophisticated investors. A couple of years ago The Guardian reported on an environmental, social and governance-related tracker fund that included two of the world’s largest oil and gas companies. We must ensure independent verification of claims of green credentials.

On the positive side, the fact that companies are making these claims at least gives cause for hope that this issue is important to the investor community. If people think there is a market for this, if we can get the independent criteria right for the future, and if green credentials can be easily and objectively ascertained, there will be a lot of cash flow.

Indeed, that is what happened when the Government introduced their green bonds, which were hugely over-subscribed. That was great and it shows that people are keen to invest in things that can contribute to decarbonisation and a cleaner planet. Indeed, the experience has been similar in just about every jurisdiction and nation that has offered opportunities to invest in green companies and funds, with schemes being over-subscribed.

People choose what to invest in based on their principles. They are keen to support this part of the economy, so they want to be sure that they are investing in something that is green. The difficult with greenwashing, however, is that the investment might not be green; if independently verified, that would result in significant disappointment. Fund managers and finance houses invest cash on behalf of others in these companies. Many people make such investments because they want to contribute to decarbonisation, so it is tremendously important that the cash flows to the right companies—namely, those that are green and that are transitioning to a greener position.

The other big issue is risk. If somebody had invested in one of the top four US coal producers back in 2010, the current market capitalisation of those companies would mean that the value of that investment had reduced by 99% over the past 11 years. There is a big risk in investing in something that might become a stranded asset because of our transition to a greener environment. The difficulty, of course, is that it is the smaller, less sophisticated investors who are more likely be caught in that trap.

In evidence to the Treasury Committee only this week, Charles Randell, chair of the Financial Conduct Authority, said that the marketing of green funds and investment opportunities was open to scammers to hijack. Therefore, while people think they are doing the right thing by investing in the right areas, others are piggybacking on that to create new opportunities to scam the general public.

The UK has a huge role to play in financing the transition to a green zero-carbon future. It is one of the leading financial centres in the world, managing about £10 trillion in assets, contributing about £132 billion to our annual economic activity and about 7% of our GDP. Its role in this area, providing the finance for decarbonisation, is hugely important. That is why this conversation is hugely important,—because we need the cash flow to go to the right places for decarbonisation. The finance sector has a huge role to play, so we need to ensure that those are bona fide green investments.

Although the UK is a world leader in finance generally, it is too early to say that we are a world leader in green finance. We are doing many things that are moving in the right direction, but it is too early to say that, certainly according to the conversations I have had with people from the City, and there will be independent verification of that as we go along. We need to ensure that we take the right steps in future to make sure that we are a world leader not just in finance but in green finance. It is too early to say that today.

The UK Government have done much good work in this area, with the green bonds I referred to earlier and the UK Green Investment Group, which will pump-prime investment into green technologies. Indeed, the Chancellor has set out that the UK will become the world’s first net zero-aligned financial centre, which is very welcome.

There is clearly big UK demand. In evidence to the Treasury Committee, the FCA chief executive said that in the coming years about 33% of fund manager investments would be into ESG, which is very welcome news. However, according to a recent investor survey, 80% of investors quoted the lack of disclosure and consistent definitions of green as a drawback to their ability to invest in the right areas. We need clarity so that fund managers and consumers clearly understand what is properly green and what is just greenwashed—in other words, that people get what they think they are buying.

The Government’s work on green taxonomy—how investments are categorised in different corporations—is welcome. They have set up the green technical advisory group to look at that. There will be climate-related financial disclosures by 2023 for the largest companies and more information by 2025. Some of the larger pension funds are already required to provide that information in their annual reports. There are also mandatory transition plans. All of those things are good UK domestic innovations, but this stuff needs to be international, not just national. Our broad rules are based on what happens in the EU, but the Government have set out that we are going to move on from there and set up a more challenging regime that is more pertinent to the UK domestic situation.

The EU has already set out its position in some areas and has completed its first phase of setting standards, but there are questions about whether it is aligned to the 1.5° warming target. Also, according to the criteria, gas is potentially permanently allowed rather than seen as a transition fuel, and nuclear is also included. Is that based on science or has this been the subject of lobbying by certain sectors? Such questions need to be answered.

The key is to make sure that the measures by which we judge green investments are standardised and harmonised internationally, with proper data and metrics behind them so that we do not compare apples with pears. We need to be able to tell whether they are proper green investments. There are different kinds of green investments. For example, there are investment funds that invest purely in green technologies such as renewables, and others that invest in ones that are transitioning from one technology to the other, which could be just as important as the green technologies themselves.

I am interested to hear the Minister’s perspective on this, but I am not entirely clear on who will draw up the rules. As I have said, I am sure that the green tech advisory group will be charged with a lot of the responsibility, but I would appreciate more information on whether the FCA and the Treasury will be working together on this.

I have some questions for the Minister. We have worked together on lots of different things and I look forward to talking to him about this issue in the coming days, weeks and months. Who will do the standardisation and harmonisation? When will it happen? What will it cover in terms of labelling the standards themselves and the benchmarks? Will those standards include scope 3 emissions, meaning not just the scope 1 direct emissions from the organisations but those from their supply chain and customer base? Will the criteria be measured against the 1.5° target? There are mandatory transition plans for our largest FTSE 100 companies by 2023; when will the rest of the economy be required to look at those mandatory transition plans?

Finally, I have a word of caution about unintended consequences. We want to minimise the risk of stranded assets. We need to make sure that companies and fund managers have a glide path so that they understand the transition period, adjust for the future, make strategic investments and not be left high and dry by a sudden change in policy. It is incredibly important that we take businesses with us. Even businesses that are considered brown today may be green tomorrow, and they need to be given the right period of time to decarbonise, because they too could be a very important part of our future decarbonisation plans and strategy.

16:13

[The Economic Secretary to the Treasury (John Glen)]

It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) on leading this debate, even if he acquired it from my hon. Friend the Member for Kensington (Felicity Buchan). I wish him well in his new role on the Treasury Committee, subject to the approval of the House later this evening. I thank him for the constructive contributions that he has made during my tenure, including on this subject.

Let me start with a simple statement of fact: the Government have high ambition to transform the UK financial sector and align it with net zero. We are taking bold action to deliver on that. As my hon. Friend mentioned, we launched two record-breaking green gilts this year in September and October, and announced new sustainability disclosure requirements for businesses across the economy to report their impact on the planet. We are starting to see real results. London was ranked the leading hub globally for green finance this year in a leading index run by Z/Yen, overtaking Amsterdam. I do not want to be complacent, but I think we have made significant progress already, specifically on green finance.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

I thank my hon. Friend the Minister, for giving way and I congratulate my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) on securing this debate. On the issue of those reporting requirements, as has been said companies clearly have indirect as well as direct impacts through their supply chains. Is it only direct impacts that will have to be reported, or will the indirect impacts of company supply chains also have to be acknowledged?

[John Glen]

I thank my hon. Friend for his intervention. I shall come in a few moments to address the details of the reporting requirements, the mechanisms for enforcing them and their extent. If I have not adequately scrutinised his point and given him the right response, I will right to him—but I hope I will cover it fully in a moment.

Z/Yen said that London was

“propelled up the table by the government implementing measures to stimulate Britain’s green finance sector”

and that it

“has the best sustainability standards in the world”.

As my hon. Friend the Member for Thirsk and Malton mentioned, at COP26 the Chancellor announced that the UK would go further and become the world’s first net zero-aligned financial centre. That is easier said than done. In fact, delivering this will require the Government and private sector to work hand in glove—I welcome the UK private sector’s leadership on this. At COP26, we heard that organisations with $130 trillion of assets globally have now made a net zero commitment. These are big numbers with big implications; it is critical that the claims that firms make about their green performance are credible and backed up with real action.

I will now turn to the title and substance of today’s debate. It is absolutely clear that we need a robust approach to greenwashing. We have heard that phrase a lot over recent years, but I would define greenwashing as when businesses, or investment funds, make misleading or unsubstantiated claims about the environmental performance of their products or activities. That can lead to the wrong products being bought—undermining trust in the market—and to misallocation of capital intended for sustainable investments. In other words, it has the potential to be a significant problem at a time when we are trying to make a sincere and credible transition that is verifiable.

The Treasury Committee report on decarbonisation and green finance, published in June, was also clear that

“‘greenwashing’ is detrimental to good consumer outcomes and to the achievement of... net zero”.

As interest in environmental, social and governance investing increases—which it is, rapidly—it is only right that there should be more attention given to, and more scrutiny of, the claims that firms make. It is for all those reasons that the Government have sought to be on the front foot on tackling greenwashing.

I will take the Chamber through the three areas of action: disclosures, mainstreaming climate into financial regulation, and transition plans. On disclosures, as I mentioned previously, it is the Government's intention to propose legislation, I hope in the next Session, to implement economy-wide sustainability disclosure requirements. This will see financial services firms, real economy corporates and investment funds reporting information on the risks they face from climate and environment, and those that they create. A key element of SDR will be reporting against the UK green taxonomy, which my hon. Friend the Member for Thirsk and Malton has mentioned. The taxonomy will set a robust standard for when economic activities can be considered environmentally sustainable. It is specifically designed to tackle greenwashing by creating a common understanding of which activities, and which investments, can actually be considered green. There is one other aspect on disclosures. Asset managers, asset owners and investment products will all be required to substantiate any sustainability claims they make in a way that is accessible to clients and consumers. All of this will create much-needed transparency in the market and ensure that firms cannot claim things without backing them up.

Our second area of action as a Government has been mainstreaming climate change in the UK’s financial regulation. In March, the Chancellor set out new remit letters to the Financial Conduct Authority and Prudential Regulation Committee, which included climate change for the first time. In November, the FCA published its new environmental, social and governance strategy, and the themes of trust and transparency are core to the FCA’s plans in this area. I am also aware that market participants are increasingly reliant on third-party ESG data and rating services to make decisions, which is why the Government are considering bringing these firms into the scope of FCA regulation and will report back next year.

I also want to address transition plans. Industry leadership on climate change, particularly through net zero commitments, has been impressive, but commitments need to become concrete action. That is why the Chancellor announced at COP26 that the UK would move towards making the publication of transition plans mandatory in the next 12 months. A transition plan should set out an organisation’s high-level carbon targets, its interim milestones and, most importantly, the actionable steps it plans to take. That will improve transparency around how those headline commitments translate into action.

My hon. Friend the Member for Thirsk and Malton asked me a number of questions about which businesses will have to report, when those requirements will come into force and how reporting will help us reach net zero, and I will take those in turn. We will ensure that any burden on business is proportionate and provides useful information for investors’ decision making. Exact details of organisations and products in scope will be determined by the relevant regulators and Government Departments following consultation. Anticipated timings are set out in the roadmap that we published in October.

The UK’s approach ensures that the SDR will come into force in a sequenced, co-ordinated manner, so that reported data flows from corporates to the financial sector, investors and financial market participants make sense, are logical and are scrutinisable. The “Greening Finance” road map, published by the Government in October, sets out the indicative path to introducing integrated sustainability disclosure requirements across the whole economy. The implementation of legislative and regulatory measures will be subject to the parliamentary timetable that I referenced earlier.

In terms of the impact of reporting on the UK getting to net zero, high-quality corporate sustainability reporting is clearly foundational to investors having the information that they need to make well-informed investment decisions. Any action to align capital investment with the transition to net zero is contingent on financial markets having access to the right and relevant information, and identifying which companies are successfully managing their climate-related risks and opportunities. Fixing that information gap is the first phase of the UK’s approach, and getting market participants to act on the information is the second phase, which will ensure that financial flows across the economy shift to align with that net zero commitment. There has been a concerted attempt across Government to ensure that we are very clear about what that journey needs to look like, and more will flow from the legislation next year. I hope that addresses my hon. Friend’s points.

The Government are taking determined action to tackle greenwashing and maintain trust in the growing market for sustainable finance. I thank my hon. Friends the Members for Thirsk and Malton, and for Central Suffolk and North Ipswich (Dr Poulter) for their well-informed contributions and challenges. I hope that this has been a helpful exchange for my hon. Friend the Member for Thirsk and Malton. I will consider his points carefully, as I always do, and take forward any elements to which I have not responded.

Question put and agreed to.

16:24

Sitting suspended.

Neighbourhood Policing: West Midlands

Tuesday 14th December 2021 Westminster Hall

16:28

[Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)]

I beg to move,

That this House has considered funding for neighbourhood policing in the West Midlands.

It is a pleasure to serve under your chairmanship, Sir Edward. I am delighted to have the opportunity to lead today’s debate. I start by thanking my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) for securing this debate, and for allowing me to open in his stead. I congratulate him on his appointment to the shadow Home Office team; I know he will be a great champion for the safety and security of our communities in that brief. He has been doing an outstanding job in raising the issue of the lack of policing in the west midlands. I also thank colleagues who have joined us this afternoon to discuss this timely and important topic. We are holding this debate to discuss police funding for the west midlands and to argue for our region to get the fair funding that it needs and deserves.

The west midlands has the fourth highest rate of crime in the country. This Government have been in power for a long time—11 years, to be exact. When they were re-elected in 2019, it was on a promise to level up every region in the United Kingdom. Nowhere needs that more than the west midlands, which has lost out terribly from policing cuts over the past decade, and where many of our communities have been blighted by crime.

We all know the Government’s record here, particularly on the delivery of justice for victims; we have plummeted to record lows in the last decade. Between 2010, when the last Labour Administration were in government, and 2020, the percentage of crimes that ended in a charge or court summons was halved. The delivery of justice for victims of violent offences is even worse. Someone who has been robbed is half as likely to see the culprits charged or taken to court—down from 19% to 8.2%. For violence against the person, charge rates are four times lower than they were a decade ago. Some 98% of reported rape cases do not result in a charge. What does that say to women?

That is where we are after a decade in which the Conservatives have cut 20,000 police officers from our forces. We have seen central Government grants to the police fall by 30% in real terms, and forces are increasingly relying on income raised through council tax, known as the police precept. Police have also been forced to make more use of reserve funding—money set aside for unforeseen spending—and have had to sell off capital assets, including police stations, to help to raise funds. Between 400 and 600 police stations were closed between 2010 and 2018 by the Conservatives, in addition to the loss of 20,000 officers.

We on this side of the House know that cuts have consequences. That kind of capacity, experience and expertise cannot be replaced overnight. The Prime Minister pledged to recruit an extra 20,000 officers by 2022 and, since then, only 11,000 extra officers have been recruited. Truly, only the Tories could cut 20,000 police officers, watch crime rates soar, recruit 11,000 officers, pat themselves on the back and say, “Job well done.”

In the west midlands, we have had 2,221 officers cut and £175 million slashed from our budgets since 2010. At the same time, there have been huge cuts to the services that are vital to preventing crime in the first place, such as youth clubs, mental health services, local council funding and probation services. The police are also having to respond to complex and serious crimes, ranging from human trafficking to sexual crimes against children, which are becoming increasingly common. Despite that, the Government’s much-trumpeted uplift programme promises to restore only 1,200 officers to our region, leaving us 1,000 short of where we were. Is that levelling up? No, it is not—the people of the west midlands would say so too.

The situation has been absolutely frightening for some of our constituents. In one case that I had recently, two masked men broke into the home of an elderly lady in my area and tried to rob her. A neighbour’s light came on, they were disturbed, and they ran off, but I cannot imagine just how petrified she was. The police officer who responded did his absolute best; he gave her advice on changing her locks, and so on, but when asked how she could possibly feel safe and secure—how she could be sure that they would not come back—he could only say to her that she could move in with her relatives. That is deeply unacceptable.

I remember working on the case of another lady who was pulling into her driveway when a man ran over and stole her bag out of her passenger seat. She called the police and gave them a description of the man and his getaway car, but without CCTV, they said there was not much more that they could do. They did not have the resources to prioritise it and the case was NFA’d—no further action was taken. We hear this all the time.

I cited some of the most appalling national statistics on charge rates earlier. Is it not incredible that in the UK, the CCTV capital of Europe, our charge rates are so appallingly low? Many of our constituents see the rise in violent crime in their areas, and they are scared. Violent crime is rising, with conviction rates at record lows. Gangs with machetes on the streets are not uncommon, as is knife crime. Is this the new norm? The Conservatives have become the party of crime and disorder. To keep our communities safe and restore confidence, we need to bring back neighbourhood policing. Constituents say to me all the time that they barely see officers on their streets and that they do not know their officers’ names. They do not know whom to call and are instead directed to online reporting.

So stretched have services been that the police are constantly reacting, making trade-offs on what to prioritise, and doing less and less proactive work. They are not able to build relationships or undertake vital preventive work and early interventions with young people, which we know are so effective. Neighbourhood policing is what many police officers proudly tell me they want to be doing more of—being a trusted presence within the community, working closely with people and using a range of problem-solving skills to address community issues, which we know have worked in the last decades. It is about providing a visible deterrent to people who think they can commit crime and get away with it.

Under the Conservatives, criminals have never had it so good, which is why I back the plan for the new West Midlands police and crime commissioner, Simon Foster, to put boots back on the ground with 450 extra neighbourhood police officers, guaranteeing that officers are based in all our local areas and ensuring that victims of crime are always a top priority and can access timely advice, care and support. Clearly, the funding situation is not easy for West Midlands police, but it is right to direct investment into more officers on the ground, rather than maintaining empty stations. Bricks and mortar, without people, do not stop crimes, but this is a situation of the Government’s own making.

Let us be clear that officers are much needed. There are rising levels of theft and robbery, and devastating cuts to preventive and mental health services have left the police to pick up more and more of the pieces, with less time to spend fighting crime. The College of Policing estimates that 2% to 20% of incidents reported to the police are linked to mental health issues. Under this Government, neighbourhood policing numbers in our region have been decimated, dropping from 1,821 to 760 between 2010 and 2018. Police community support officer numbers also fell, from 811 in 2010 to 464 in 2021.

Given the expectation that a new policing funding settlement will come out on Thursday, we have called today’s debate to make a last-ditch plea to Ministers to give our region the funding it needs. I work closely with my local police and have nothing but admiration for their selfless service, bravery and professionalism, but they are being let down. The west midlands is not getting a fair share. It is patently unfair that forces with lower crime rates, such as nearby Warwickshire, have increased their police numbers over the past decade, whereas our region could still be left 1,000 officers short under the Government’s uplift plans. With the new funding settlement on Thursday, my question to the Minister is very simple: will he give West Midlands police the fair funding that they need? Will he hear the pleas of our constituents who feel let down by the Government and give our forces a fighting chance?

16:38

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

I commend my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill) for making such an eloquent speech and raising all those figures. I also commend my hon. Friend the Member for Birmingham, Erdington (Jack Dromey), who secured the debate. Owing to his position as a shadow Minister, he is unfortunately not able to take part.

This is a crucial debate to my constituents and the people of Birmingham. We have people who live in fear. In my constituency, gangs maraud around with knives, baseball bats, sticks, machetes and, in some instances, guns. The police are called, but they are not able to attend because they need sufficient numbers for such an event, which I understand.

There is a business in my constituency. A group of young people got together and opened a car wash. They do not employ labour from abroad; they wanted to do it themselves and make a living for themselves. For some reason, they were set upon by a gang—probably because they did not want them to open the business where they had. They made several complaints to the police themselves. Nobody turned up. A week later, when the father approached me and spoke to me, they still had not come. I made enquiries and the police were not able to visit those young people, who wanted to better their lives and their local environment.

It is not the fault of the police officers who work in my area. They work extremely hard—fantastically hard—but they do not have the numbers. As my hon. Friend the Member for Birmingham, Edgbaston says, the West Midlands PCC is working extremely hard to increase numbers. It is important to heed the words of the PCC. If they do not have the officers to do the work, it is difficult to do the work. That is what the problem is.

I have a fantastic sergeant working in my constituency, Nick Hill. He came in as a breath of fresh air in my patch. He is available literally all the time. He comes to community events. He wants to engage, to the extent that we were able to set up a police drop-in at a local church on a Tuesday afternoon, so that people who could not get through to the police on the phone or by other mechanisms could come and see the police and report things. That is a fantastic initiative.

We have some local police officers who are doing a fantastic job. On my own security, Nick has been fantastic. If I tell him where I am holding surgeries, he tries his best to support me. We all have to think about our position and our safety, particularly since the tragic incident of Sir David Amess. That is an additional requirement for the police. More issues are being added to the list for the police to address.

There are also issues within the policing structure. The Home Office has said that more officers need to have a degree to work on the streets.

[The Minister for Crime and Policing (Kit Malthouse)]

No, they do not.

[Mr Mahmood]

Well, that is what I am being told—that police officers need to have a degree to be able to work. A lot of recruits have been taken in. I know about four recruits who have come into my constituency as police officers who have come in through the degree mechanism, and there are others who have been told they need to complete degree qualifications in order to move on, which removes them from the limited number of police we have. There are some people who want to be on the street, who want to do policing, who have the qualification, who want to build connections within the community and deliver those services. What we want are police officers who understand local communities and know what is going on.

In another policing debate, I mentioned a PCSO in my area who was a member of the Labour party, and joined the police, so he cannot deliver leaflets for me any more. Rob Capella has done fantastic work. He has been there almost 20 years now. He is recognised by the community. Less so now, because he has less of a team to operate, but he used to go on the streets to understand and speak to people. He was a huge resource as the eyes and ears of the police, working in the community, and that gleaned great intelligence. We can only do that if we have sufficient numbers of police.

Before 2010, we used to have neighbourhood meetings. We would get police there. We would get PCSOs there. We would get people speaking to them in Perry Barr. My hon. Friends here will understand that, in Perry Barr, where we have Handsworth, Lozells and Aston, there have been significant issues with policing and crime. Before 2010, we had some of the lowest crime rates across the country. We did only one thing: increase the police. We had more PCSOs in those areas, and we delivered for the community.

People in the Asian community have a huge issue in terms of robberies that are taking place. Most people understand that it is a traditional practice to have gold jewellery, particularly for weddings and those sorts of events. Those things have been targeted specifically, and damage has been done to buildings and to people. We need more police officers, and we will achieve that only if, on Thursday, we look at the police settlement for the west midlands and listen to the PCC, who is working hard to ensure that we get more police officers. It is the only way to deal with crime. That is what Margaret Thatcher said—to give an example of someone the Minister may look up to. The only way to police is to ensure that there is sufficient policing in the community. If we do not have sufficient police in the community, it is not safe for them or for my constituents. My plea is that West Midlands police get their fair share of the police officers required to give our communities peace of mind and to have law and order in our city and my constituency.

16:45

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

It is a pleasure to see you in the Chair, Sir Edward. I congratulate my neighbour, my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill), on leading the debate, and my hon. Friend the Member for Birmingham, Erdington (Jack Dromey), who is now the shadow Minister for Immigration—and apparently for debate procurement—on securing the debate.

I hear all the time from constituents who are frustrated about the small number of prosecutions of those who burgle our homes, steal our cars and threaten our loved ones. It is inescapable that falling police numbers are part of the explanation of why that is happening and why people are so frustrated. Even if the Prime Minister and the Policing Minister keep their promise and restore some of their party’s cuts to police funding, we will still end up with 1,000 fewer officers in the west midlands than in 2010, and we will continue to suffer from an unfair formula that drives up our council tax and gives us a smaller share of Government grant than places such as neighbouring Warwickshire, resulting in its ability to increase its police numbers at the very time that ours have been substantially reduced. That is the unfairness.

I am totally behind the call for a fairer formula, properly applied, and better funding for West Midlands police. It is essential if our constituents are to get a better deal. I also wonder whether other areas of reform need consideration. In 2005, my old boss, Charles Clarke, who I am sure you remember, Sir Edward, suggested proposals to increase police numbers and to lower costs by reshaping and reducing the overall number of forces. His ideas, as the Minister may know, were bolstered by a report from Her Majesty’s inspectorate of constabulary that argued that the existing structure of the police was not fit for purpose. It recommended creating strategic constabularies of sufficient size to provide effective neighbourhood policing and tackle organised crime.

Those plans were opposed by politicians of all parties, if I remember correctly, and by chief constables and the then Association of Police Authorities. As a result, we still have broadly the same configuration in place almost 17 years later, although now it seems to have been bolstered by police and crime commissioners.

I acknowledge that lots of police and crime commissioners do a good job and make a good impact, although it occurs to me—the Minister will recall a debate in this place a few weeks ago—that they have in their own way led to a further politicisation of the police. They have brought much more politics into the police, which is why we had an argument the other week about the West Midlands police and crime commissioner’s Conservative opponents opposing his police plan which, of course, is a requirement. But the creation of so many commissioners also means that reform, which may mean reducing the number of forces, is much less likely to take place now.

I have concluded that we need two things: top-quality detectives, investigators and specialists to help crack the cyber-crime that destroys businesses and empties bank accounts, to stop people such as modern slavers and to smash criminal gangs. But we also need police to tackle burglary, vehicle theft and antisocial behaviour. If neighbourhood policing is forced to compete with organised crime for resources, I suspect it will always be the poor relation. In the west midlands, we have already lost 50% of neighbourhood officers.

Perhaps now is the time to think again about reform. Why not a two-tier system, with ringfenced resources protecting the numbers policing our streets, gathering local intelligence and keeping the community safe and a separately funded second tier of specialised officers able to wage war on organised crime? That would require revision of the formula and probably a reduction in the overall number of forces, but it could yield the kind of policing that many of our constituents are asking for.

16:52

[Taiwo Owatemi (Coventry North West) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I thank my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) for securing this important debate and my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill) for leading it.

It goes without saying that over a decade of Conservative budget cuts have had a hugely damaging effect on police forces up and down the country. Since 2010, police staff numbers across England have declined dramatically. We have over 21,000 fewer people working in the police: 8,000 fewer officers, 7,000 fewer staff and 7,000 fewer community police officers.

We have talked about how the police cannot deal with these levels of cuts without a devasting impact on public safety, on upholding the law and on the morale of the remaining workforce. However, those national figures do not give the full picture, which is why we are here today in this important debate.

The impact of deep funding cuts to neighbourhood policing in the west midlands has been beyond terrible. The region currently suffers from the fourth highest crime rates in the country. Between 2010 and 2018, Government cuts have decimated neighbourhood policing in the west midlands by almost 40%. This is disgraceful. In the last 10 years, the number of police community support officers has been cut in half.

Officers are now severely overstretched and unable to be a visible presence in a single neighbourhood, and crime rates in the west midlands have certainly not been cut. Over the last 10 years, overall crime in the west midlands has risen by 21% and violent crime has risen by 41%. That is not a coincidence.

While the Government have spent a decade dismantling neighbourhood policing in the west midlands, our police officers have found themselves struggling to combat or prevent crime and unable to provide the public with policing rooted in their neighbourhood. My constituents in Coventry North West are suffering the consequences of that. They tell me that seeking justice when they are the victim of a crime is incredibly difficult. Many feel unsafe in their own homes or on their streets, especially the most vulnerable among them.

This is certainly the case for one of my constituents, Maureen Crealey. After parking her car in her own driveway, Maureen woke up to find that it had been stolen in the middle of the night. This was one of a string of car thefts on her street. When Maureen reported this crime to the police, they gave her a number and took her details, but no one has since gone to her house. No one has gone to examine her street or provided reassurances to the public. Maureen is a widow who lives alone and has been left feeling frightened, abandoned and vulnerable—not by the police but, in her own words, by a system that has failed to give our police the necessary

“manpower to cover our streets”.

Maureen was very clear when she wrote to me:

“More money needs to be invested in our police to protect the citizens of Coventry.”

I could not agree more. Without extra resources and police officers, police forces do not have the capacity to give constituents such as Maureen the support they need to feel safe in their own homes. In fact, police capacity to respond to anything except the most dire emergency has been diminished significantly. I know that this reality pains many current and former officers. Officers know only too well that policing in this country is cash-strapped and struggling to keep up with complex demands and rising crime rates. This is exactly why antisocial behaviour, drug dealing, theft and home burglaries are all too common in Coventry.

The police are not able to deal with these common crimes, because this Conservative Government have hamstrung policing capacity in my city. Most worryingly, the cuts have regrettably diminished trust in the police. Many constituents do not feel that the police are on their side or are visible enough in their community. This is often because police officers cannot be everywhere at once and because their capabilities are being slashed by the Government. We must take urgent action to support our neighbourhood policing in the west midlands. The Government must support our outstanding police and crime commissioner, Simon Foster, who has been working tirelessly to rebuild neighbourhood policing and invest in community police officers.

I call on the Government to work with Simon and to restore our neighbourhood policing in the west midlands, but the Government must not stop there. They must reform the policing funding formula to ensure that sufficient sustainable resources are fairly allocated to the west midlands. They must strengthen youth and prevention services to make sure that we tackle the root causes of crime. They must pass a victims Bill that prioritises the needs and experiences of victims as they move through the criminal justice system. To truly fulfil the Government’s pledge to level up the west midlands, will the Minister agree to enact these much-needed measures, or will the Government’s inaction be further proof that “levelling up” is another hollow slogan from the Prime Minister?

16:58

[Tahir Ali (Birmingham, Hall Green) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I would like to thank my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) for securing the debate. I also thank my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill), who is my constituency neighbour, for leading it.

I recently had the pleasure of joining local police units on an operation in the Sparkbrook area of my constituency. The operation was focused on road and traffic offences and was a huge success. Several untaxed and uninsured drivers were picked up, stolen vehicles were towed and parking tickets were issued by Birmingham City Council’s civil enforcement officers. The operation was very well received by residents and was a great example of the kind of productive work that can be done in partnership between the police and the local authority. Officers were glad to be out in the community, working to keep people safe, and residents were thankful for their efforts.

However, it also gave me an opportunity to speak to Inspector Fitzpatrick and Sergeant Chris Gallon, who informed me of the constant challenges faced by themselves and officers. We all know that police numbers are stretched thinner than ever before and that the Government’s promise of 20,000 more officers across the country will barely begin to address the challenges faced. Crime is becoming more complex, with many offences spanning numerous boundaries in terms of enforcement and responsibility. The decimation of local council funding and support after years of Tory austerity has meant that police are often the first to respond to those in greatest need of care. All this occurred alongside a worrying spike in gang activity and other serious crime.

As a result, our police officers are often bogged down in reactive policing, with fewer and fewer resources available for proactive, long-term community work. We know that neighbourhood policing takes time, commitment and sustained effort over many months to build productive partnerships with local businesses and community groups. Local officers in Birmingham, Hall Green are already doing much of this work despite the scant resources available to them. Imagine what could be achieved if our police were fully resourced and supported in their efforts.

Another thing I learned while speaking to officers is that the problems confronting neighbourhood policing are clear and straightforward. Resources are simply not available, either to the police or the local council. It is evident that our communities want a greater police presence. Neighbourhood policing gives us the opportunity to really tackle the social problems that many of our constituencies face daily. I urge the Government and the Minister to examine seriously the resources required to ensure consistent delivery of neighbourhood policing in the west midlands.

Back in 2000, when I was given responsibility for neighbourhoods and community safety, police numbers were increased and we saw a decline in criminal activity in the west midlands and Birmingham area. That has reversed under Tory austerity. Enough is enough—that is what our constituents tell us daily. It is vital that the Government and the Minister listen not only to residents but to the police themselves, and particularly those who patrol the streets we live in and who see what is happening, about what is needed to keep communities safe, for the police to protect and for us, as elected Members, to represent them.

17:03

[Marco Longhi (Dudley North) (Con)]

It is a real pleasure to speak under your chairmanship, Sir Edward. I thank the hon. Member for Birmingham, Erdington (Jack Dromey) for securing the debate. This Government value all our police officers. That is why, with our 11,053 extra police officers, we are not on target, but ahead of target to deliver our manifesto pledge of 20,000 new officers; there are 867 new officers already working in the west midlands.

The financial settlement gave West Midlands police an inflation-busting 5.8% increase to its budget—a staggering £36 million. In addition, the rises in local tax that residents pay, together with council tax, put West Midlands police at the top of league tables across the country for precept increases; since 2012, a staggering increase of 79% has been imposed on people in Dudley North and across the west midlands by the Labour police and crime commissioner.

Dudley people—and those across the west midlands, I am certain—can see that effective policing is about more than just money. It is about local decision making and how that filters down from the chief constable and the police and crime commissioner.

[Valerie Vaz (Walsall South) (Lab)]

Will the hon. Member give way?

[Marco Longhi]

I would rather not, just now. The facts sadly speak for themselves. We need the right strategy for deploying all the new police officers we recruit, making the right decisions locally, and having the will and competence to deliver on them. The Labour police and crime commissioner has closed dozens of police stations, while spending more than £30 million on refurbishing plush offices at his headquarters in Lloyd House in Birmingham.

[Steve McCabe]

Will the hon. Gentleman give way?

[Marco Longhi]

Not just now.

[Steve McCabe]

Does it say in the hon. Gentleman’s speech whether he will give way at any point?

[Sir Edward Leigh (in the Chair)]

Order. Calm down. The hon. Gentleman does not have to give way if he does not want to.

[Marco Longhi]

Meanwhile, Dudley and Sedgley police stations have closed. Some hope was given to Dudley people when a new police station was promised in Dudley. It was hailed by my predecessor—the noble Lord Austin—as a new multimillion-pound station to replace the one in Brierley Hill. Several years later, we are still waiting for it. In 2019, it was announced that it would open in 2021, yet no detailed plans have been submitted by the police and crime commissioner to the council planning department.

Dudley is a major metropolitan town—I believe it is the largest town in the country that is not a city—and it has been without a central police station since late 2017. We are paying the price for no presence as a result of inaction and incompetence. Perhaps the Minister might inquire of the police and crime commissioner when Dudley people might see shovels in the ground and the promised new station.

I have great respect for a local police inspector in Dudley by the name of Pete Sandhu and his team. They are trying their utmost to make do with offices borrowed from Dudley Council that are, quite frankly, not fit for purpose. Inspector Pete Sandhu, the local police teams and PCSOs in Dudley town, the surrounding villages and those across the west midlands not only deserve but need a station that is fit for purpose. Unfortunately, time and again, Labour police and crime commissioners have failed their constituents—including mine.

[Steve McCabe]

On a point of order, Sir Edward. Is it in order—or, indeed, the custom—for the Minister’s Parliamentary Private Secretary to read someone else’s speech during a debate?

[Sir Edward Leigh (in the Chair)]

Would the hon. Gentleman like to reply to that?

[Marco Longhi]

I would. If the hon. Member for Birmingham, Selly Oak (Steve McCabe) checked, he would find that I am not, in fact, a PPS.

[Sir Edward Leigh (in the Chair)]

There you are.

[Steve McCabe]

I apologise to the hon. Member for Dudley North (Marco Longhi). Can I ask who wrote his speech?

[Sir Edward Leigh (in the Chair)]

Are we having a little debate now?

[Marco Longhi]

I wrote it.

[Sir Edward Leigh (in the Chair)]

We have established that. I apologise—I did not call you earlier because I thought you were a PPS; you are sitting in the PPS’s place. I know it is a bit of an insult to call anybody a PPS, so I think we all owe you an apology.

17:09

[Sarah Jones (Croydon Central) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) on securing the debate and my hon. Friend the Member for Birmingham, Edgbaston (Preet Kaur Gill) on taking on the mantle. I also congratulate my hon. Friends the Members for Birmingham, Perry Barr (Mr Mahmood), for Birmingham, Selly Oak (Steve McCabe), for Coventry North West (Taiwo Owatemi) and for Birmingham, Hall Green (Tahir Ali) on their powerful speeches. Every one of them cares about nothing more than the safety of their constituents, and that is why Labour Members are here en masse. Sadly, there is only one Government Member present—the hon. Member for Dudley North (Marco Longhi). I suggest that he talks to more of his constituents about how they experience crime in their constituency and ponders what they have to say.

This is a vital and timely debate. The Government have dropped the ball on crime: serious violence is up, prosecutions are down, and they have no plan to tackle their failures. The west midlands is an excellent part of the country, with brilliant people who have hopes, dreams and aspirations that are being hampered by this Government. In the excellent police and crime commissioner Simon Foster, whom I visited only a few weeks ago, they have a champion with the right priorities, but he is fighting against crime with one hand tied behind his back because of a Government whose complacency has allowed serious violence to thrive and neighbourhood policing to dwindle.

There are four areas where that complacency has driven up violence and other crimes, such as antisocial behaviour. First, of course, is the lack of policing. The 21,000 lost police officers is a well-worn statistic, but less well known are the 50% cuts to police community support officers, the eyes and ears of our community. The Government have dismantled neighbourhood policing since 2010. Do not take my word for it: twice as many people now as in 2010 say that they never see police on the streets.

Secondly, the UK is now Europe’s largest heroin market and a target for international drug-trafficking gangs. That has increased violence on our streets and steered a trend towards youth violence, with increasingly young children carrying knives and drugs. Thirdly, violence against women and girls has reached epidemic levels, as defined by Her Majesty’s inspector of constabulary and fire and rescue, Zoë Billingham, in her damning report earlier this year. Prosecution rates for crimes such as rape and sexual assault are on the floor. Fourthly, all the services that support young people, such as youth work, treatment for drug addiction and support for children with special educational needs, and that more broadly tackle inequality and poverty have been decimated after 11 years of drift.

The west midlands has not been exempt from the impact of those cuts. Despite the excellent work of Simon Foster, who has put rebuilding neighbourhood policing at the heart of his agenda, the force will be 1,000 officers short of where it was in 2010. By anyone’s description, that is a large number of officers for one region. It cannot be right that, even with the so-called uplift to police numbers—as an aside, just 400 of the first tranche of 6,000 national recruits have been placed in frontline roles—the west midlands faces such a large shortfall.

The Government make a fanfare of their fêted levelling-up agenda, but make no mistake: there is no levelling up when it comes to the west midlands constabulary. If this Government do not put in place more funding, West Midlands police will face annual cuts of £60 million to deal with rising costs. The west midlands police and crime commissioner recently made a cross-party call for fair funding for the force that he oversees, and is calling for the Government to plug the black hole and put funding in place for the 1,000 missing officers. I support those calls. Does the Minister?

I recently met Simon Foster and saw for myself the excellent work that he is doing through solid policing, and through innovation via the violence reduction unit. For example, a new scheme places youth workers along routes to schools; they act as trusted adults, pull children away from crime, and de-escalate potential violence. Violence reduction units do good preventive work, but there is no long-term funding model for them, and the Minister knows that. They rely on annual funding. I am especially disappointed that Andy Street seemed unaware of this fact on “Politics Live” last week. He claimed that a long-term funding model had been put in place, and also seemed unaware of his role in tackling violence through his responsibilities for youth unemployment, community cohesion and housing, which all have vital roles to play. Can the Minister confirm whether the VRU in the west midlands will receive a funding settlement of longer than one year?

Her Majesty’s inspectorate of constabulary and fire and rescue noted that West Midlands police

“is good at strategic planning, organisational management and providing value for money.”

However, it added that the force cannot

“meet the demand for its services in protecting vulnerable people with the resources it has.”

Ultimately, it is the people of the west midlands who lose out; it is they who bear the brunt of this lack of funding. That cannot be acceptable. If the Government are serious about levelling up, they must start with organisations such as West Midlands police. Can the Minister commit to filling the gaping hole in resources in the west midlands, so that it is not 1,000 officers down on 10 years ago?

Neighbourhood policing in every community will always be Labour’s top priority. Keeping people safe will always be Labour’s top priority. I urge the Government to make it theirs.

17:14

[The Minister for Crime and Policing (Kit Malthouse)]

As always, Sir Edward, it is a joy to appear before you, and it was great to hear the speech from the hon. Member for Croydon Central (Sarah Jones)—I think it was 3a this time. I have heard it a number of times before. [Interruption.] I am sorry; they are all broadly the same.

I often find these debates a bit disheartening. They make me wonder how many years will have to pass before Labour Members stop constantly using the refrain “austerity”. It is almost 12 years ago that that necessary corrective financial action was taken, and I hope that in time, Opposition Members will mature beyond looking back over a decade for the impact that they are seeing today. Even if they do not, wouldn’t it be nice if any argument about austerity were presaged by an apology for crashing the economy—for the Labour Government that ran it hot, allowed the banks to take dreadful risks, ran down the country’s reserves and then almost bankrupted the country, ushering in a coalition Government who had to take difficult financial decisions? [Interruption.]

[Sir Edward Leigh (in the Chair)]

Order. Silence.

[Kit Malthouse]

I have never shied away from those difficult financial decisions that have to be taken. Nevertheless, generations will pass, and maybe in 50 years the Labour party will stop talking about that period of austerity and talk about what is happening today. Today, I thought I was coming to a debate about the value of neighbourhood policing. However, it has become obvious that this is a pretty naked political manoeuvre in advance of some difficult financial decisions that the police and crime commissioner for the west midlands will have to make as he moves towards setting his council tax. My hon. Friend the Member for Dudley North (Marco Longhi) has highlighted how significantly council tax has increased over the past few years.

Most of the hon. Members present are experienced parliamentarians. As such, they all know that the funding formula is set in law, and when the police settlement is announced later this year, it will be divvied up between the forces as per the legislation. There is nothing we can do, discretionarily or otherwise, to change that; the funding formula has been in place for some time. We have acknowledged that it is elderly, as I have said at the Dispatch Box—the hon. Member for Croydon Central has heard me say it many times. We are working on a replacement, and we hope to have one in place soon. Nevertheless, this year, as hon. Members know perfectly well, the police settlement will be settled on the basis of that legislation, so the social media posts, tweets and videos that Members put out will be promoting to the public a misapprehension that something could change before later this week, when the police settlement will be announced.

Beyond that, I find these debates a bit disheartening because of the lack of curiosity exhibited by Members about the performance in the west midlands. For example, they never ask themselves why other police forces are doing better. Why is Liverpool doing better than the west midlands? Why is Humberside doing better than the west midlands? They point to the reduction in police numbers in the west midlands and the fact that the numbers at the end of the uplift may not be above where they were in 2010, but they do not ask themselves why there are forces, such as those in Kent and London, where those numbers will be higher than in 2010.

[Several hon. Members rose—]

[Kit Malthouse]

I will give way in a moment. Those Members are unwilling to acknowledge the reason, which is that decisions were made by the previous Labour police and crime commissioner that set the west midlands back. They have to take responsibility for those decisions; they cannot, I am afraid, just come to this Chamber and keep saying that everything that goes wrong in the west midlands is the Government’s fault, and that everything that goes right is the Labour party’s achievement. Nobody is buying that in Edgbaston, Selly Oak, or anywhere else in the west midlands. They recognise that difficult decisions had to be made, and I urge the Labour party to acknowledge those difficult decisions.

David Jamieson was not all good, and he was not all bad. He had difficult things to do, and he made a set of choices that produced a particular outcome and a particular baseline in the west midlands. I have no doubt that that was what he said in the elections that he won, and that the people of the west midlands took him at his word and believed him. They have re-elected a Labour police and crime commissioner, so presumably they are happy with that performance, but complaining that everything that goes wrong is down to the Government seems a little naive to me.

[Sarah Jones]

Knife crime has gone up in every single part of England and Wales.

[Kit Malthouse]

That is not true.

[Sarah Jones]

It is true. I can send the Minister the statistics. Crimes have gone up across the country. It is not accurate to blame one area or another for those universal increases and the universal drops in prosecution. Of course, there are good police forces and less good police forces, and everyone tries their best. The point we are trying to make is that we are 1,000 police officers down, which means neighbourhood policing will suffer. On the point made by the hon. Member for Dudley North (Marco Longhi) about the police station, I should have mentioned that the police and crime commissioner is waiting for the Conservative council to sell them the land to build the police station. Perhaps we could talk about that later.

[Kit Malthouse]

I understand the hon. Lady’s point, but it is unfair and pulling the wool over the eyes of the people of the west midlands not to stand by the fact that a Labour police and crime commissioner—or any other police and crime commissioner elected, presumably —has an impact on the force. The decisions they make must have some implication for the way the force is run and its finances.

[Several hon. Members rose—]

[Kit Malthouse]

I have taken an intervention already; I will take another in a minute. It is extremely important for the confidence that people need to have in the west midlands that that is acknowledged. This was a different period financially for the country; people had to take difficult decisions. The west midlands made a certain matrix of decisions that resulted in the outcome today. A number of forces around the country made different decisions. As a result, they will have more police officers than they had in 2010. That is something with which hon. Members will have to wrestle; I am afraid that is the plain truth.

On neighbourhood policing, I am pleased to hear that there is a thrust in the west midlands to invest in neighbourhood policing, not least because the neighbouring Staffordshire force has been doing that for some years, to great effect. The police and crime commissioner and the former chief constable there took the decision to invest in neighbourhood policing and, interestingly, traffic policing, as the basic building blocks of an excellent delivery of service to their people. As a result, they saw significant reductions in neighbourhood crime. My hon. Friend the Member for Dudley North referred to the uplift number, which is 800-odd. I encourage exactly that kind of intervention. It is what lies behind our desire to expand the number of police officers in the country.

Difficult decisions had to be taken over the previous decade—you were part of the team that took those difficult decisions, Sir Edward, as a member of the party in power at the time—but the economics of the country now allow us to invest in policing in the face of changing crime.

[Tahir Ali]

Will the Minister explain why £175 million has been taken from west midlands policing since 2010, resulting in 2,200 fewer officers on the street? Giving back 800 officers does not replace the 2,200 lost. There is a deficit of 1,600. Can the Minister please explain?

[Kit Malthouse]

I am sorry if the hon. Gentleman missed it, but as I explained earlier, his predecessors blew the credit card and broke the bank in the country. Difficult decisions needed to be made, and the police and crime commissioner David Jamieson made a certain set of decisions about how he and the chief constable were going to prioritise spending.

The hon. Member for Croydon Central is probably tired of hearing this, but I was Deputy Mayor of London for policing between 2008 and 2012. We faced precisely the same budgetary challenges as the west midlands. It was extremely difficult; we had a £3.5 billion budget, and in two years I had to take something like 10% out of it, which is an enormous cut, but we chose to prioritise police officer numbers. We fought tooth and nail to maintain those police officer numbers above 31,000, and we were successful in doing so. As a result, our crime performance was better. That was also because of the tactics we pursued; it is not all about numbers.

Different decisions were made by police and crime commissioners during that period, and that has resulted in different outcomes for each of the forces. It would be foolish and, to be honest, financially illiterate, not to recognise that. We can see that in police forces’ reserves position, in the disposition of the property portfolio, and in the balance between police staff and police officer numbers. Every year, police and crime commissioners, who preside over all those things, have to produce a result from that quite complicated combination.

[Marco Longhi]

Can the Minister help me out with a point made by the shadow Minister, the hon. Member for Croydon Central? Dudley Council is ready to sell the land right now if the police and crime commissioner decides to sign the contract. Also, planning permission is not contingent on property ownership. This is about local decision making. We could shorten the long time that it would take to get planning permission and get things going now.

[Kit Malthouse]

Sir Edward, I feel like a Foxtons representative here, negotiating a property deal across the Chamber. How dynamic we can be when we put our minds to it.

There is significant extra funding going into policing, and there has been over the last two years. We now have a three-year funding settlement that gives us an enormous uplift in resources. For the west midlands, that means £655.5 million next year, which is an increase of £35.1 million. That is a very large increase, and I hope the west midlands spends it well. We can all agree that neighbourhood policing is a significant priority, and that we would like more investment in it. It is welcome that the police and crime commissioner is doing that in the west midlands.

We agree that the funding formula is out of date and a little old fashioned. It has not been reviewed for some time, and we are working on a replacement. I have given an undertaking at the Dispatch Box that we expect to hold that review before the next election, assuming that Parliament runs its full term. Finally—I will give the hon. Member for Birmingham, Edgbaston (Preet Kaur Gill) time to wind up—there has been much debate about what position the 20,000 police officers will put us in. Hon. Members make all sorts of claims about where we will be. They forget that in the final year of the Theresa May premiership, there was a recruitment drive for 3,500 police officers; that can be added to the number as well. When we get to the end of the 20,000 uplift, we will, I think, have the highest number of police officers the country has ever had.

17:27

[Preet Kaur Gill]

I am sorry that the Minister decided to go off track in his response. In any event, I am grateful to him. I thank all the hon. Members who took part in the debate, which made it clear that at the centre of the issue are families and others across the west midlands who have felt left behind, and who deserve a fair police funding settlement. I hope the funding settlement will reflect that.

[Mr Khalid Mahmood]

The Minister did not clarify the point about the management of West Midlands police. Her Majesty’s inspectorate of constabulary and fire and rescue services said:

“The force is good at strategic planning, organisational management and providing value for money.”

That includes the input of both the police and crime commissioner and the chief constable in the west midlands. I will not see West Midlands police run down in that manner.

Question put and agreed to.

Resolved,

That this House has considered funding for neighbourhood policing in the West Midlands.

17:28

Sitting adjourned.