Westminster Hall

Tuesday 7th June 2022 Westminster Hall

Tuesday 7 June 2022

[Mr Clive Betts in the Chair]

Statutory Gambling Levy

Tuesday 7th June 2022 Westminster Hall

09:30

[Carolyn Harris (Swansea East) (Lab)]

I beg to move,

That this House has considered proposals for a statutory gambling levy.

Today, we will consider the introduction of a statutory gambling levy to replace the inadequate voluntary model, and it is a pleasure to do so under your chairmanship, Mr Betts. I draw the House’s attention to the fact that at the back of the room we have bereaved families of people who gave their lives up to gambling addiction. I thought it only fair to highlight that at the start.

As we all know, the gambling review was launched over 18 months ago, and most of us thought that by now we would be discussing the detail of the White Paper in the Chamber, but unfortunately, that is not the case. I am hoping that good things come to those who wait. With just a couple of weeks to go until the highly anticipated publication of the long overdue Government reform of our gambling legislation, I am pleased by the shift in direction towards reform that the Department for Digital, Culture, Media and Sport has signalled. Press reports over the past few weeks of the Government’s plan to introduce limits to online stakes and to pioneer an affordability system to prevent people from gambling beyond their means are welcome indeed.

Stake limits online should be comparable to those for land-based venues, and to be effective, any system of affordability must be run independently of the industry and have a single customer view. This is not the time to take half measures, and only banning front-of-shirt sponsorship without tackling the dozens of other ways in which gambling firms advertise would represent a missed opportunity. That would not address the harm that advertising can lead to, nor would it reduce children’s exposure to advertising as they watch sport on their screens.

Given that the previous gambling legislation review took place well over 15 years ago, the White Paper needs to make meaningful, robust and significant proposals. However, we are here today to discuss a specific proposal that I believe is vital to the success of the gambling review and which must be at the centre of the Government’s plan: a statutory levy on gambling operators to provide long-term funding for research, education and, most importantly, treatment of gambling-related harm.

Gambling is leading to significant harm in this country, and more than 55,000 children aged between 11 and 16 are gambling addicts. The gambling industry spends more than £1.5 billion a year on advertising, and 60% of its profits come from the 5% who are already problem gamblers or at risk of becoming so. On average, one problem gambler commits suicide every single day, and we have families here today who have experienced such loss.

Funding for research, education and treatment with respect to gambling-related harm in the UK is facilitated through a system of voluntary contributions from gambling operators, which should be 0.1% of their gross gambling yield. That goes to GambleAware, and each year, at current levels, that equates to donations totalling around £10 million. From there, funding is allocated by GambleAware to a range of third-sector organisations, academic institutions and two NHS providers. That might sound like a sensible amount of money and a seemingly sensible system, but if we consider the scale of the cost of gambling harm and how poorly the voluntary levy is operated, it soon becomes clear why this is a woefully inadequate method of providing funding for research, education and treatment.

Because of the voluntary nature of the contributions, operators can vary the size of donation that they send to GambleAware, which means there is a lack of consistency in the amount donated each year. Operators even have discretion over how much they contribute, with some operators giving as little as a few pounds. Alongside that ridiculous situation, operators are able to decide when donations are made. As a result, there is a complete lack of stability in the voluntary funding model. Recipients cannot plan budgets effectively, or ensure that long-term research projects or education programmes are properly funded, when they have no idea whether there will be enough money to continue them.

To make things worse, operators are able to determine who their contribution goes to, meaning that the voluntary system allows the gambling industry to retain a sense of control over the funding. That damages the independence of the service providers, academic institutions and other third-party recipients of funding, as well as the effectiveness of the levy in reducing wider gambling harms in the UK.

[John Spellar (Warley) (Lab)]

Will my hon. Friend give way?

[Carolyn Harris]

I will make some progress, because I have a long speech and a lot of people want to speak.

Earlier this year, NHS clinicians announced that they would stop taking money from the gambling industry to treat people with addiction. While I agree with the sentiment, I worry that that will only hurt treatment services in the long run. We need to find a better long-term solution to allow the NHS to access funding that comes from the industry but is not controlled by it.

The all-party parliamentary group for gambling related harm and Peers for Gambling Reform have recognised and commented on the limitations and failings of the current voluntary system. That view is shared elsewhere. Back in March, Lord Foster of Bath, chair of Peers for Gambling Reform, received a reply to a letter, from Andrew Rhodes, chief executive of the Gambling Commission. In his reply, Mr Rhodes stated that

“the current voluntary system does not provide long-term certainty of funding to support planning and commissioning, it does not impact on all operators fairly, and it is perceived as allowing gambling operators too much control over the availability and destination of funds.”

[Craig Whittaker (Calder Valley) (Con)]

Will the hon. Lady give way?

[Carolyn Harris]

I am not giving way. Even GambleAware, the charity that receives voluntary donations, commented recently on the woefully inadequate nature of the voluntary levy. Its chief executive, Zoë Osmond, said in April that the industry has never reached its target of achieving 0.1% of GGY—gross gambling yield—from the voluntary industry levy. The vast majority of the industry continues to donate in support of research, education and treatment at extremely low levels.

[John Spellar]

I thank my hon. Friend for giving way. I refer to my entry in the Register of Members’ Financial Interests. She referred to expenditure being tied to donors, but the industry puts billions into the Treasury through taxation, so should that not be properly done through the national health service? Also, will she say what she actually wants for the industry? Does she want to close down gambling, or does she acknowledge that millions of people enjoy gambling perfectly safely and that abuse is going down?

[Carolyn Harris]

If my right hon. Friend listened to the rest of my speech, he might hear some information about where that is not the case. As for me being anti-gambling, I am certainly not. I spent last Thursday night at Ffos Las racecourse having a thoroughly good time placing bets on horses.

Clearly, the voluntary levy is not fit for purpose. It lacks consistency, transparency and, crucially, accountability. So, what is the solution?

[Craig Whittaker]

What the hon. Lady is trying to achieve is admirable, and she will find that she has a lot more support than she realises. My big concern, which I expressed in the previous debate on this subject as well, is the black market—the offline, unregulated areas. Black market gambling is growing at a huge pace, including, believe it or not, over WhatsApp, which is highly encrypted and hard to tackle. If we are to have a levy, how does she propose that we tackle this area? I fear that it will, sadly, push people into the black market.

[Carolyn Harris]

I draw the hon. Gentleman’s attention to the comments of Peers for Gambling Reform and the Gambling Commission about the industry’s expression of concern about the black market being extremely over-exaggerated.

[Craig Whittaker]

That is such a scary comment to make. I point the hon. Lady to the report “The State of Illegal Betting” produced by the Asian Racing Federation, which includes Australia, Japan and Hong Kong among its 17 members. It states that 61% of online gambling is unregulated, illegal and on the black market. Would she like to refute that evidence?

[Carolyn Harris]

I draw the hon. Gentleman’s attention, again, to the Gambling Commission’s own words that the scare around the black market has been grossly overestimated. That is from the Gambling Commission, not from me.

[Paul Blomfield (Sheffield Central) (Lab)]

I was involved in the campaign to regulate the payday lending industry. Does my hon. Friend recognise that in order to protect its profits, the sector’s big argument was, “Don’t touch us, because the threat is the black market”?

[Carolyn Harris]

I agree entirely, and I will talk about exactly that later. It is clear to see that the voluntary levy is not fit for purpose. What is the solution? Well, a solution is already in place and available: it is set out in the Gambling Act 2005. There are already provisions in legislation for the Government to place the collection of levy donations on a statutory footing should the voluntary arrangement be shown not to work, which clearly it does not. DCMS should use existing powers to require operators to pay an annual levy to the Gambling Commission. A joint advisory levy board should then be given oversight of the levy paid. That would be a formal cross-Government working group led by the Department of Health and Social Care. The levy board should oversee a comprehensive assessment of the evidence base of gambling-related harm and the limitations of the current voluntary system.

It is also crucial that the levy is graduated or smart. By that I mean that when considering the options for calculating the statutory levy, officials have devised a formula that requires companies offering potentially more harmful gambling products to pay a correspondingly higher proportion of the levy—more simply known as a “polluter pays” principle. This has precedent in New Zealand, where the gambling problem levy is set by an Order in Council and reviewed every three years. A lottery provider, bingo hall or high street bookie or casino will pay far less than a giant monopolised online gambling operator. There is also precedent in the UK: the Financial Conduct Authority already operates a similar system for financial services organisations, where a statutory levy is imposed on firms to fund free-to-client debt advice according to the “polluter pays” principle.

[Scott Benton (Blackpool South) (Con)]

The problem with having a statutory levy is that it would hit land-based gambling companies—casinos, bingo halls and the high street shops—when they are just emerging from the pandemic. I appreciate that the hon. Lady suggested they would be levied at a slightly different rate, but the problem is that if those businesses go out of business, we could see a huge cost to the Exchequer from loss of taxation revenue, lost jobs in communities and an economic hit on the high street. Does she not consider that to be a likely outcome of a statutory levy?

[Carolyn Harris]

I certainly do, but I just stated that the statutory levy would be graduated so that land-based high street bookies, on-street casinos and bingo halls would not pay the same levy as online companies who make a lot more profit than the individual companies, who will also have overheads of staffing costs and business rates. I acknowledge all that, but the proposal is aimed at making sure that the polluters pay the most.

If it was brought in by the DCMS, a 1% levy on industry revenue would provide £130 million of funding for research, education and treatment. That would massively improve the disparity between other nations’ spending and that of the UK. Australia spends £368 per gambler, Canada spends £329 per gambler and New Zealand spends £413 per gambler. The UK spends £19 per gambler. If we had funding for research, what could we do? We would finally be able to hold a proper prevalence survey, not wholly inadequate telephone surveys of a few hundred people, to ascertain exactly how many people in the UK are suffering gambling-related harm, so that we can get them the help they need. There would be improvements in research and data for clinical outcomes, along with the quality of data collection, to ascertain how gambling treatment clinics are performing and what more could be done to improve treatments.

With better and more certain funding for education, we can prevent people falling into the hands of gambling operators in the first place. We can highlight ways to set up banking blocks, deposit limiters, advice services and many more tools, not only to teach people about the dangers of some gambling products, but to signpost those who are already addicted towards help.

Finally, and probably most importantly, we come to treatment. Treatment for gambling addiction in the UK is completely inadequate. Chronic underinvestment in the gambling treatment system, as a result of the current voluntary levy, has led to a scenario in which treatment is unregulated, unaccountable and fails to use the evidence base in its strategies. Only between 2% and 3% of people with gambling problems enter the treatment system, all of whom are self-referrals. With a statutory levy, that can change.

It is clear that the statutory levy is vital to the success of the gambling review, but the industry would disagree. It would say that the largest companies have donated £100 million already, with more to follow, and it would label as anti-gambling those of us who call for this levy. I would call the industry anti-reform. That £100 million is well under what would have been collected by a statutory levy, and there is no continuity or certainty in that funding. Clinicians, the Gambling Commission and GambleAware all say that current funding levels are insufficient.

The industry claims that the introduction of a flat- rate levy would be unfair to some land-based sectors, such as casinos, bingo and high street bookies, because those sectors might contribute to less harm but would be disproportionately affected by a levy as a result of the potential impact on jobs. That is a deliberate misinterpretation of the position. The whole point of a levy is that the less harm that is caused, the less need there is to pay for the consequences of that harm. If some sectors harm less than others, it makes perfect sense for them to pay less. That is what is meant by a smart levy, based on the “polluter pays” principle.

[Philip Davies (Shipley) (Con)]

I should refer Members to my entry in the Register of Members’ Financial Interests. As the hon. Lady knows, because we have spoken about this, I do not particularly disagree with her about the principle. The one thing that does worry me is that she and some of her colleagues might never be satisfied with the rate at which the statutory levy is set. If it was set at 1%, they might say it should be 2%; if it was 2%, they might say it should be 3%; if it was 3%, they might say it should be 4%. We would have a never- ending arms race.

Because I do not disagree with the principle, could the hon. Lady give me some reassurance that she would support a fixed, unamendable figure for a statutory levy, for example 1%, with a lower rate for land-based sales—I agree with her about that—to prevent the arms race I am worried about?

[Carolyn Harris]

I find myself in the position of matriarch of the anti-gambling brigade, which I am not. I have no interest in persecuting the industry; I merely want it to pay for the damage that it has caused. I have no intention of forcing any argument that the levy should increase. I am just asking for common sense, and for the worst polluters to give 1%. I will then walk away from this argument, quite satisfied that my job is done.

The truth is that the most toxic forms of gambling, which cause extensive harm, have the means to pay for the harm they cause. The industry will say that levels of problematic gambling are low. Tell that to the families at the back in the Gallery who have lost children. Tell them that problem gambling rates are low. We are having this debate because of the industry’s reluctance to do the right thing. It reacts to our reform recommendations with petty name-calling and offers feeble attempts at self-regulation. For a cash-rich industry, its commitment to repairing the damage that it causes or to preventing it from happening in the first place is both pathetic and insulting. If a statutory levy is introduced alongside tackling the question of affordability, ensuring that people are not gambling more than they can afford, we can stop the vast exploitation that we have seen in recent years. If that is brought in alongside stake limits for online gambling, to give parity with land-based venues, we can ensure that people do not fall into the depths of addiction. If it is introduced with meaningful reform of gambling advertising, sponsorship and direct marketing, along with the ending of inducements to gamble, we can prevent the poisonous hold that operators have on people through their addictive products. It is clear to me that, without a statutory levy at the heart of the White Paper, this Government will have missed a once-in-a-generation opportunity to bring analogue legislation into a digital era, to radicalise a toxic environment and—without a shadow of a doubt—to save lives.

[Several hon. Members rose—]

[Mr Clive Betts (in the Chair)]

I am just observing how many hon. Members want to speak in the debate. There are five. That means a guideline of about seven minutes for each Member before we come to the winding-up speeches.

09:51

[Scott Benton (Blackpool South) (Con)]

It is a pleasure to speak under your chairmanship, Mr Betts. I refer hon. Members to my entry in the Register of Members’ Financial Interests and thank the hon. Member for Swansea East (Carolyn Harris) for securing the debate.

With the current review of the Gambling Act 2005 drawing to its long-awaited close—hopefully; we have been here many times before over the last 18 months—this is certainly an opportune moment to be debating this subject. Far too often, emotion, instead of evidence, drives the debate about betting and gaming in this country. Nowhere is that felt more keenly than in the discussion about how problem gambling is tackled through research, education and treatment—RET.

Some 22.5 million British adults enjoy a bet every single month. According to the independent regulator, the rates of problem gambling in the UK are falling, having reduced to 0.2% now from 0.6% just 18 months ago. Although of course one problem gambler is one too many, those figures are positive compared with other European countries. The rate is 2.4% in Italy, 1.4% in Norway and 1.3% in France. One could therefore conclude that the regulated market in Britain is relatively successful in keeping rates of problem gambling fairly low.

For the past few decades, the industry has rightly shouldered the financial responsibility for that work by paying a voluntary levy to fund independent charities tackling problem gambling. Despite that, anti-gambling campaigners are demanding a new, statutory levy on the industry—a tax by another name—to fund RET. That poses one obvious question: would funds generated through a statutory levy and given to the Department of Health and Social Care really make a tangible difference to the delivery of RET and to problem gambling in the UK? The clear answer is no.

The current system is making good progress, and in any event, a blanket levy would not raise materially more money for RET than is raised at present, but it would disproportionately hammer casinos and bingo halls, where just a 1% hit on turnover equates to a 10% hit on profit. That could put many bingo halls, casinos and other land-based operators in places such as Blackpool out of business, costing thousands of jobs and the Exchequer vital revenue, as I alluded to previously.

[Paul Blomfield]

The hon. Gentleman says that the current system is making good progress, but the latest National Gambling Treatment Service statistics from GambleAware show that 49% of users have a risk level that indicates that they remain at risk at the end of their treatment. Does he think that that is good progress?

[Scott Benton]

There is clearly more work that we can do in this area, but it would help if the NHS had a long-term strategy for dealing with the issue, which it lacks at present. I will say more on that point in a few moments.

Under current arrangements, all companies regulated by the Gambling Commission are expected to make a voluntary contribution of 0.1% of turnover. To put that in context, in 2019-20 that figure was £10 million. Most of the funding goes to GambleAware, which is a totally independent charity. The industry has no say whatever on how that money is spent. In its five-year strategy published last year, the charity says that it expects to see that income increase to £39 million by the year ending 2024. As the hon. Member for Swansea East alluded to, the four largest gaming companies—Entain, William Hill, Flutter and Bet365—have agreed to increase their contributions to 1% of turnover. That is an additional £100 million over a four-year period to tackle the issue, with all of that funding going towards tackling and preventing the causes of problem gambling.

As I said in response to the intervention from the hon. Member for Sheffield Central (Paul Blomfield), the NHS still does not have a long-term strategy to tackle problem gambling. It was only in 2019 that the Department of Health announced it would open 15 new NHS clinics for addicts. Despite that, only five are open so far, with three more supposedly coming online later this year. Meanwhile, it is the industry and charities that have spent the last two decades trying to tackle the issue. Currently, charities use about 160 locations for face-to-face counselling services—part of an already mature network of clinics, treatment centres and outreach programmes that are making a real difference right now.

A statutory levy would risk charities’ existing funding models by taking cash out of their coffers and putting it into the NHS, which, sadly, is not yet set up to delivering those services.

[Ronnie Cowan (Inverclyde) (SNP)]

Has it crossed the hon. Member’s mind that the difficulty for the NHS in rolling out its plan for 15 clinics is the lack of guaranteed funding, which is exactly the strategy that a smart statutory levy would cover?

[Scott Benton]

The issue has been around for decades. Obviously, the gambling review is long awaited. Hopefully, that will help to address the issue, but it is unmistakable that the industry has taken voluntary steps over the years to try to tackle the problem. What we need is a consensus on the most appropriate way forward. For the reasons outlined, I do not think that a statutory levy is the answer, but I am open to hearing all Members’ views, so I am attending the debate to hear both sides of the argument.

A clumsy one-size-fits-all approach would have a disproportionate effect on land-based operators, which are only just recovering from the pandemic. In truth, it would be catastrophic on those businesses, because, like the rest of the hospitality sector, they have many fixed costs to fund, including staff, business rates, tax and licences. A tiered system would take that into account and better protect jobs.

[Carolyn Harris]

If the hon. Gentleman refers to Hansard to read the comments I made earlier, he will see that I reiterated everything that he has just said, so I do not quite understand his comments.

[Scott Benton]

I suspect the hon. Lady is referring to her opening remarks. I appreciate that she spoke about the differential system between online operators, which she suggested were the worst polluters, and land-based operators. The problem is that many land-based operators run on a very small profit margin, so even a very small statutory levy could put them out of business. The high street is already struggling, and I am afraid it would be a double whammy when we simply do not require it.

[Craig Whittaker]

The one area where we already have a levy is the horse-racing sector, which has a strong link with gambling and betting. What does my hon. Friend feel that an additional levy on that sector will do to those jobs and on horse-racing?

[Mr Clive Betts (in the Chair)]

Order. I remind hon. Members that seven minutes was the guideline.

[Scott Benton]

Time is short, so I will not directly respond to the points made by my hon. Friend the Member for Calder Valley (Craig Whittaker), but I suspect he knows my feelings about an additional statutory levy, which is essentially a tax. It could create problems for horse-racing at a time when we are already considering other prohibitive measures that would affect sponsorship, and other elements of the debate that could have a further impact on horse-racing and, indeed, all sports.

Third sector charities are already effective and are making real progress. In contrast, a statutory levy looks like a retrospective solution to a problem that simply does not exist at the level that anti-gamblers want policymakers to believe. Is it really designed to help research, education and treatment, and the wider public as a whole, or is it a punitive measure to placate the anti-gambling lobby? A statutory levy will not boost funding for RET. The money is already in the system, and there is a bigger, broader commitment for the future. The Government need to tread carefully if they are to avoid hurting businesses and putting thousands of jobs at risk.

10:01

[Paul Blomfield (Sheffield Central) (Lab)]

It is a real delight to contribute to a debate under your chairmanship for the first time, Mr Betts. I thank my hon. Friend the Member for Swansea East (Carolyn Harris) for her comprehensive and powerful statement of the case, to which it is difficult to add anything.

I simply want to draw on the experience of my constituents, Liz and Charles Ritchie. I am delighted that Liz has been able to join us this morning. Their son, Jack, was one of the more than 400 people estimated each year to take their life due to gambling addiction, but he was never diagnosed with a gambling disorder; he was told by health professionals that he had an addictive personality that he would have to learn to live with. During the inquest into his death, the coroner described gambling warnings, information and treatment as “woefully inadequate”. The coroner’s “Prevention of future deaths” report states:

“The treatment available and received by Jack was insufficient to cure his addiction—this in part was due to a lack of training for medical professionals around…diagnosis and treatment”.

Jack took his life in 2017, but unfortunately things have not changed enough since then. As I said to the hon. Member for Blackpool South (Scott Benton), according to the latest data from GambleAware, National Gambling Treatment Service statistics show that 49% of users still have a risk level of 3+, indicating that they remain at risk when their treatment has finished. We need to acknowledge, as the gambling review does in a sense, that we need to do more and much better.

Despite the wholly unfortunate characterisation of those of us making this argument as an anti-gambling lobby, I thought the hon. Member for Blackpool South helped our argument considerably when he talked about the inadequacy of provision in the NHS. He is right; that is at the core of our argument. Treatment, public messaging and prevention of harm are not sufficient in the UK to combat the severe harm experienced by gamblers exposed to dangerous products.

The Advisory Board for Safer Gambling explained the problems with the current voluntary system: a lack of transparency, a lack of equity across operators, a record of insufficient funding, and unpredictable voluntary funding that creates barriers to distributing money where it can have the most impact, such as the NHS. We have begun to hear the arguments this morning. The Betting and Gaming Council often boasts about how its leading members volunteered to boost their joint funding of education and treatment services to £100 million during the 2019-23 period. That figure of £100 million—plucked from the air—over four years is not generous; it is a tiny proportion of the extraordinary profits those members make from other people’s difficulties. Most importantly, it does not come close to tackling the scale of the task we face.

As the hon. Member for Blackpool South pointed out, there are only five gambling treatment centres in the UK, with two further centres planned to be opened this year. That is against a background in which research published by Public Health England last September estimated that about 0.5% of the adult population—about a quarter of a million people—are likely to have some form of gambling addiction, with some 2.2 million either problem gamblers or at risk of addiction.

According to research by the University of Bristol—this is a figure that we really need to stop and think about—55,000 children under the age of 15 have a gambling addiction. Jack’s addiction started while he was at school. A statutory levy is vital to ensure we have the sufficient funds to meet the challenge presented by gambling as it operates now. The levy must be independently collected and channelled into the NHS, so that the industry does not have undue influence over its allocation; my hon. Friend the Member for Swansea East made that point powerfully.

There is a recent proposal from the Social Market Foundation to administer the levy through an independent levy board, which would allocate resource and ensure that the NHS services required are sufficiently funded. Existing organisations funded by the industry have an obvious conflict of interest and cannot fulfil that function. We are beginning to move away from the individual responsibility model and attitude to gambling problems towards a public health approach. As we do that, we need to change the Gambling Commission’s third objective, so that it has a clear responsibility to minimise gambling harm by protecting the whole population.

[John Spellar]

Will my hon. Friend reflect on the statement made by my hon. Friend the Member for Swansea East (Carolyn Harris), who argued that the black market is greatly overestimated? I caution that that is always the response of the bureaucrats who provide the figures. It was true on cigarette smuggling, red diesel fraud and self-employment fraud, as well as many other areas. There is always a tendency to underestimate what goes on in the sub-economy. Is there not a danger that this issue will also be underestimated, if we over-regulate?

[Paul Blomfield]

As I said in an intervention on my hon. Friend the Member for Swansea East, from my experience of tackling the payday lending industry on a cross-party basis, the argument that it came up with to defend its own profits was, “Be afraid of illegal loan sharks, so do nothing about us and the misery that we are causing, because there is that threat out there.” We need to tackle both. That strategy needs to be developed and funded by a statutory levy.

Let me return to Jack’s case and the conclusions that were raised at his inquest by the coroner, who insisted that, despite small changes in regulation and treatment since Jack’s death, significantly more needs to be done by the state to protect people. Crucially, Jack did not know his addiction was not his fault. Liz and Charles think that if his addiction had been recognised as a health problem and treated more effectively—if he had been given the correct information and the doctors had been better informed—he could still be alive today, and so would many others.

Medical experts agree. Dr Matt Gaskell, who leads the NHS Northern Gambling Clinic, explained to the inquest that the treatment Jack received was insufficient, and he spoke about the impact gambling has on the brain, causing major changes as addiction develops quickly. He underlined that the whole public are at risk, not just a vulnerable few, and I know that that is also the view of the Minister responsible, the Under-Secretary of State for Digital, Culture, Media and Sport, the hon. Member for Croydon South (Chris Philp), who has previously said that gambling harm could affect any of us.

Obviously, a new approach is needed—one that promotes harm prevention and information about risk, as well as treatment and provision for early diagnosis. We have the skills and knowledge in our NHS, but we need the investment to make those services available to all who might need them. The hon. Member for Blackpool South said the NHS should be doing much more, and he is right, but the big flaw in his argument is that that should not be at the cost of other NHS services. It should be based on the “polluter pays” principle: those who do the harm should cover the cost of addressing it.

On the intervention made by the hon. Member for Shipley (Philip Davies), the levy should be set at the rate necessary to cover the costs of mitigating the harm and providing the treatment. If the problem gets worse, the levy may have to go higher; if it is reduced as a consequence of effective treatment, the levy may go lower. The levy should be responsive and based on the “polluter pays” principle. However, I am conscious of the time and of the fact that you are glaring at me, Mr Betts, so I will finish on that point. I hope that the Government recognise the power of these arguments.

[Mr Clive Betts (in the Chair)]

The guideline is now that speeches should be six minutes. Can we try to stick to that, to make sure all colleagues get in?

10:11

[Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)]

It is always a privilege to serve under your suzerainty in these matters, Mr Betts. I am sorry that there is not a whole bank of media here to report this important debate. Something else seems to be going on in the House that has taken them away, although I cannot think what that is or was.

We do not have a lot of time, so I will keep this short. I say to some of my colleagues who have interests—I have nothing against that; it is important in helping them to keep in contact with what goes on outside—that I wish they would not keep repeating the idea that anybody who wants to deal with the harms that occur as a result of gambling, much as we would if we were talking about alcohol or illegal drugs, is somehow completely and utterly opposed to things that are legal.

The reality is that I, for one, happily bet when I go horse-racing, as I do occasionally. I like to go to the ring, because it is the most free market area of all, and I love it—I love walking around looking for the best odds. That, for me, is fine. I do not, therefore, have any problem with gambling, and I defend it endlessly. Some of my constituents have businesses in the ring, although many lost their businesses when the National Joint Pitch Council was formed, which was a travesty.

I simply say to my colleagues: please stop this nonsense that people such as Mr Dugher and others go on about! It is nonsense to suggest that someone who is in favour of some kind of help, support or assistance for those who have serious difficulties—as the families present are—is opposed to the whole idea of gambling. We could not stop gambling tomorrow if we tried, because people like to bet on things. That is the nature of it. However, the case for the statutory levy being debated today makes absolute sense. The argument that having a levy will somehow drive everybody into the black market is silly. I have always found that when one makes extreme arguments in this place, one loses the case.

I say honestly to some of my colleagues—those who have interests—that it would be a good idea to say to the gambling industry that things have to change. We did all of this in relation to fixed odds betting terminals, and we were given the same arguments then: it would be a disaster, it was terrible, it would end up with gambling collapsing and people going into the black market, and all the rest of it. Those extreme arguments do not work, because they lessen the point.

I come back to my genuinely hon. Friend the Member for Shipley (Philip Davies), for whom I have huge regard, as he knows. I agree with him on pretty much everything, and I agree with him today. He is taking the right course, which is to look at how this issue can be resolved, rather than simply saying, “If you do anything, you are going to destroy gambling.” The gambling industry will destroy itself if it spends its whole time opposing everything with these doom-and-gloom scenarios. That will just make people think that it has something to hide.

I will not repeat my arguments on the statutory levy, because I do not have a lot of time. My hon. Friend the Member for Swansea East (Carolyn Harris)—in this case, I will call her my hon. Friend—made her arguments well, so I will stand on those. It is true that all the reports show that we have to have a statutory levy. Not to have one would be unfair to many of those responsible companies that wish to do something but that find that others—some of which have a lot of money but are irresponsible—do less than they should. The way to do this is to find a way to pay a proportion back to help those who have problems and to improve things.

I agree with the comments that have been made about the health service. Every time money is put into it, that money goes into all sorts of places, but not necessarily where we might want it to go, so a statutory gambling levy must be ringfenced to tackle the harms that are created. In a way, ringfencing would limit the amount we need, because as we put more money in, we hopefully reduce the harms. In terms of some of the other reforms, if things such as the abuse of VIP rooms are taken out of the equation, I sense that the level of harm would be reduced to a manageable level—I doubt it will ever be eradicated, but we would get it to a manageable level.

I just want a bit of common sense in this debate. Let us engage with the idea of a levy. Personally, I would be happy to look at the case for saying that we do not shift it for a set period of years. Perhaps we can look later at varying it in degrees if there is a reduction in the level of harm, but that is a debate to be had. What we should be debating is how that levy comes in and is managed, and how we can give some guarantees to companies that this is not simply a rolling tax increase. I accept that that is where we should be with this debate.

In a previous debate, three hon. Friends, who are not here today, read out speeches written by Bet365, and I did not think that that did this place any good at all. In truth, we are here for our judgment, not for somebody else’s judgment. I have no objection to Members standing up for the gambling industry and defending it; that is absolutely right and exactly what this place is all about. However, I do object to the fact that we sometimes think that we have to just say what the industry wants us to say—we do not.

My hon. Friend the Member for Shipley is right that we should recognise that there is a problem and that there may be a way of dealing with it. We must come together, across parties, to resolve that problem. I encourage my hon. Friend the Minister to tell his colleagues in Downing Street, “Just think about how we could do this, not whether we should do it.” If we can get to that point, the White Paper will make sense. We should make sure it is a proper paper that deals with the problems and recognises that the industry will not simply go away.

If the harms can be dealt with, we can have a reasonable, decent industry that recognises and faces up to its issues and problems without running away from them. We will then have fewer people, and their families, being destroyed by addictions that have come about because of the pressures that have mounted up on them. If we can do all that, we will have done a service in this place. On that basis, I would be happy to discuss with anybody how we get this done.

10:17

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Betts. I thank my hon. Friend the Member for Swansea East (Carolyn Harris) and congratulate her on securing the debate and on the passionate way she outlined the case for the Government to act faster to introduce a statutory levy.

Gambling-related harm is an issue that many, including myself, care deeply about, not least because of the detrimental impact it has on society as a whole, but also because it is far closer to home. Gambling-related harm runs through my constituency. Its impact is felt by people with lived experience of gambling harm and their family and friends. Faced with the real-life stories of my constituents, I simply cannot understand how anyone does not support reform. The mere fact that gambling harm is happening every day is proof enough that our current gambling regulatory system is failing us.

The voluntary system, which relies on the goodwill of the industry, has been woefully inadequate. The current system has no integration of NHS services, as we have heard, and also no consistency on funding decisions and no co-ordinated oversight of research into harms. What is more, there are serious questions to be asked about the independence of the voluntary system from the influence of the gambling industry.

We can see that the scale of the problem is huge, and yet there is so much to uncover. A mandatory levy in statute is an essential step for generating funding towards research, prevention and treatment services. Researching and growing our knowledge base will allow us to better understand the extent of the issue and, importantly, tackle it effectively, driving support and funds towards NHS treatment and support networks. Most importantly, that would be free from the influence of the industry that is perpetuating the harm that we are trying to treat.

The time has come for the onus to be placed on the betting industry to address gambling harms. It must be held to account for the damage it has inflicted through dangerous marketing and customer practices. The asks that myself and my colleagues have outlined today are rooted in a desire to help build a society where the risk of real harm from gambling is no longer accepted. The time for that is now long overdue, and the Government must take action. With the publishing of the White Paper, and everything that comes with it, there is an opportunity to take action. To keep to your time limit, Mr Betts, I will conclude by saying that I look forward to the Minister’s response. I hope he can reassure us that the Government are listening and will take the appropriate action.

[Mr Clive Betts (in the Chair)]

Last but not least, I call Jim Shannon. If the hon. Member can finish before half-past 10, that will allow time for the winding-up speeches.

10:20

[Jim Shannon (Strangford) (DUP)]

I will keep to your timeframe, Mr Betts. I congratulate my hon. Friend—she certainly is my hon. Friend—the Member for Swansea East (Carolyn Harris) on securing the debate. There are very few debates that she secures that I am not here to support, but this one is of particular interest to me, and I will explain why. I should also declare an interest as a member of the all-party parliamentary group for gambling related harm.

There have been some incredible speeches from Opposition Members, and also from the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith), who put forward in a very succinct and helpful way what is very much my own line of thought. This is not about being anti-gambling; it is about how we can use the levy in a way that addresses the issue of addiction, while hopefully giving some of the money to the NHS, as the hon. Member for Swansea East said.

It is clear that gambling addiction is a significant public health issue: it ruins families, marriages and communities, and in extreme circumstances it can lead to suicide. The hon. Member for Sheffield Central (Paul Blomfield) referred to one of his constituents who had been affected, and there are families in the Public Gallery today who have also been affected. I am ever mindful of Peter and Sadie Keogh from County Fermanagh—they are not my constituents, but they came to my attention some time ago because of the issue of addiction and gambling. I have examples from my constituency of people who have been addicted to gambling, and although it did not lead to suicide, they found themselves under incredible pressure that affected their families. Gambling can lead to financial pressures in the house, arguments and ultimately the break-up of marriages.

Peter and Sadie Keogh lost their son Lewis. Their story is mirrored by the stories of those who are here today and by the stories of addiction told by others. Lewis found himself gambling and did not realise how deep the problem was getting. His mum and dad were probably not aware of everything that was happening, but they were when Lewis unfortunately took his own life. That came about because his debts had overcome him. His ability to respond and to discuss matters in their totality with his parents and friends led him to think there was only one way out. I am here today for Lewis, Peter and Sadie Keogh from Fermanagh in Northern Ireland, and for all the others in Northern Ireland who have succumbed to suicide because of gambling addiction.

The harms of gambling addiction are an indisputable fact, and yet we have limited protections in place to support the most vulnerable in society. Chronic under-investment in the gambling treatment system has led to a situation where treatment is unregulated and lacks consistency, transparency and accountability. Between only 2% and 3% of people with gambling problems enter the treatment system, and nearly all of them enter through self-referral—we need to look at that. The gambling industry is hugely well resourced, and it could and should be doing so much more to identify and protect vulnerable people.

A 1% smart levy on the industry’s revenues would provide £130 million—an increase of over £100 million on what we currently receive. What the hon. Member for Swansea East and most of us here today are saying is that that is not a big amount for the sector, but it will make a big difference. If the DCMS introduces a smart statutory levy on the gambling industry—that is already within the power of the Secretary of State—it can take control of the funding for research, education and, ultimately, treatment back from the bookies, set up a long-term funding commitment, allow clinicians and academics to commit to projects and programmes properly and safeguard the independence of research and education to ensure that the gambling industry can no longer mark its own homework. If such a levy were based on the “polluter pays” principle, it would not punish the bingo halls and the high street arcades that support local high street communities across the UK, but instead would force gambling operators who are all too often based offshore to pay for the harm that they undoubtedly fuel.

Compared with the other regions of the United Kingdom, the level of participation in gambling in Northern Ireland is higher. In England, the rate is 62%, and in Wales, it is 61.3%, but the rate in Northern Ireland, which is similar to the most recent recorded participation rate in Scotland, is 67.8%. Compared with the other regions of the United Kingdom, the proportion of the population in Northern Ireland found to be problem gamblers is also higher, at 2.3%. In Wales, it is 1.1%, in Scotland, it is 0.7%, and in England, it is 0.5%. We have a serious gambling problem in Northern Ireland, and our numbers outstrip those in the other three countries put together.

I always look forward to seeing the Minister, who is always incredibly helpful. He looks to help and reassure. I ask him what discussions he has had with his counterpart in Northern Ireland about gambling addiction and the fact that the rate in Northern Ireland are higher than in the rest of the United Kingdom put together. What steps can be taken to assist, help or advise the Northern Ireland Assembly Ministers?

The report on participation in gambling identified the four most common types of gambling in Northern Ireland as the national lottery; scratchcards or instant win; betting on an event or sport; and other lotteries, raffles and ballots. Sometimes, when I am in the garages back home getting petrol or diesel, I see people buying scratchcards, and I sometimes feel quite moved. That scratchcard is their hope of getting money to help with whatever it may be—to pay the bills—but that scratchcard is a gambler’s chance. It is very unusual for it to lead to any income.

Some types of gambling cannot be regulated in a meaningful way, but some can, and I believe that the levy is an essential tool in regulation. I encourage the Government and the Minister to see where the problem lies and to tackle it at the root. The purpose of a gambling statutory levy is to generate moneys to help those with addictions and to assist their families, and to help the NHS. It is right that the gambling sector should pay more. In my opinion, and that of many others, the publication of a White Paper cannot come soon enough. I urge the Minister and his colleagues in Government to take the opportunity to deliver meaningful change where the industry quite clearly has not yet done so.

[Mr Clive Betts (in the Chair)]

We move on to the Front Bench spokespeople, who have 10 minutes each. After that, there will be a short time for the mover to wind up at the end. I call Ronnie Cowan for the SNP.

10:28

[Ronnie Cowan (Inverclyde) (SNP)]

Thank you very much, Mr Betts. It is a pleasure to be here this morning. I thank the hon. Member for Swansea East (Carolyn Harris) for bringing forward this debate.

Gambling legislation is reserved to Westminster. The UK Government must publish the gambling review White Paper and that must include a smart levy on the gambling industry. In December 2020, Westminster announced a review of the Gambling Act 2005, which generated some 16,000 responses to a call for evidence. Yet, in June 2022, we are still no further forward from where we were in December 2020.

I have been told that the White Paper is “imminent”, “very imminent” and even “very, very imminent”, but there is still no date. Once the paper is published, there is still quite a journey before it becomes law and no doubt there will be an implementation period, too. While we dither, gambling-related harms impact vulnerable people in an unabated manner, so we must act, and act now.

We are rapidly approaching the summer recess. Minister, we need the paper now, so that it can be scrutinised and debated. We need to make substantial progress before the summer recess. We are here today, of course, to debate a statutory levy. However, I confess to being slightly confused after reading the Library briefing on this issue. Excellent as such briefings always are, this one informed me that the Gambling Act 2005 regulates gambling in Great Britain. The Act has three licensing objectives: preventing gambling from being a source of crime or disorder; ensuring that gambling is conducted in a fair and open way; and protecting children and other vulnerable persons from being harmed or exploited by gambling.

The 2005 Act is overseen and enforced by the Gambling Commission and that is where I got confused. Under section 123 of the Act, the Secretary of State for Digital, Culture, Media and Sport can make regulations requiring gambling companies to pay an annual levy to the Gambling Commission. Section 123 clearly states:

“The regulations shall, in particular, make provision for—

(a) the amount of the levy;

(b) timing of payment of the levy.

(3) The regulations shall, in particular, make provision for—

(a) determining the amount of the levy by reference to a percentage of specified receipts of an operating licence holder,

(b) determining the amount of the levy by reference to a percentage of specified profits of an operating licence holder”.

And more points are set out. Reading this section, it looks to me and reads to me as a smart statutory levy. Minister, why has section 123 of the 2005 Act never been commenced? Why are the Government not implementing a statutory levy now?

Currently, the Gambling Commission requires all licensed operators to make a voluntary contribution of 0.1% of net revenue towards the research, prevention and treatment of gambling-related harm. Most operators donate to GambleAware, a charity that commissions support for problem gamblers as well as research and awareness-raising about gambling-related harm.

In July 2019, the right hon. and learned Member for Kenilworth and Southam (Sir Jeremy Wright), who was then the Secretary of State, announced that five of the largest operators would increase their donations from 0.1% to 1% over the following four years. However, the current funding arrangement does not generate enough money to prevent and treat gambling-related harm. In a September 2020 paper for the Gambling Commission, the Advisory Board for Safer Gambling said the current funding system was

“no longer fit for purpose”.

That is nearly two years ago now.

A statutory levy would address issues of transparency, independence, equity. sustainability and public confidence. It would also have the potential to raise

“significantly greater levels of funding”

and it would also guarantee funding, so that service providers can confidently plan to recruit and train into the future. And it is not just me who is saying this. In April 2022, GambleAware called on the Government to introduce a mandatory levy of 1% of gross gambling yield. According to GambleAware, this would raise £140 million annually and would

“enable better longer-term planning and commissioning for services to prevent gambling harms”.

Unfortunately, the Betting and Gaming Council is part of the problem. In a May 2022 blog, Brigid Simmonds, Chair of the Betting and Gaming Council, claimed that a statutory levy would not make a “tangible difference” to research, education and treatment or to problem gambling rates. She said that the current funding system was “making good progress” and warned that the “clumsy one-size-fits-all approach” of a statutory levy would have a “disproportionate effect” on land-based operators that were just recovering from the covid-19 pandemic.

“Making good progress”—where is the evidence for that? The clock is ticking, people are being harmed and people are dying. And nobody is talking about a “clumsy one-size-fits-all approach”. We have identified that we require a smart levy—the polluter pays. It is callous remarks like those from the Chair of the Betting and Gaming Council that clearly show that the funds raised by a levy must be ring-fenced and allocated to NHS-commissioned work. The expenditure should be identified and allocated by medical experts, and not by the gambling industry, their appointees or politicians.

More often than not, the debate about this issue has come down to money. How do we pay for the outcomes that we seek? Where does that money come from? However, we must acknowledge here today that behind the call for money, the reality is that people are being harmed and people are dying. We need appropriate, timely action and the time for it is now.

10:34

[Jeff Smith (Manchester, Withington) (Lab)]

It is always a pleasure to see you in the Chair, Mr Betts. I pass on the apologies of the shadow Minister, my hon. Friend the Member for Pontypridd (Alex Davies-Jones), who is in Committee, as indeed is the Under-Secretary of State for Digital, Culture, Media and Sport, the hon. Member for Croydon South (Chris Philp) —although it is always a pleasure to see the Minister across the Chamber.

I congratulate my hon. Friend the Member for Swansea East (Carolyn Harris) on securing this debate and on her, as always, excellent and comprehensive speech. I congratulate all hon. Members who have taken part, including my hon. Friend the Member for Merthyr Tydfil and Rhymney (Gerald Jones). My hon. Friend the Member for Sheffield Central (Paul Blomfield) spoke powerfully about his constituent Jack, and importantly identified the shortfall in diagnosis and treatment, and the lack of specialist gambling support across the country. I have had a number of meetings with former gambling addicts, and they have often identified that it is really hard to get treatment where they want, as there is a bit of a postcode lottery. Anybody who suggests that an increase in funding is not necessary for the support and treatment of gambling addicts is completely wrong. We have a decided lack of specialist treatment, and we really need to get extra funding into it. That is the heart of the issue.

The right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) was absolutely correct when he said that the people speaking in this debate are not anti-gambling; we are anti-gambling harm. We need to make that important distinction.

As I said when we most recently debated gambling in this place, reform is long overdue and the Government have been dragging their feet. Many forms of gambling are a pastime that lots of people enjoy. They are a source of employment and economic activity for communities in towns and cities across the country. Nobody sensible wants to send gambling to the underground or the black market, but we have to recognise that it can also be a highly addictive activity that damages families and communities. That is why we need action, not more words, from the Government. Time and time again, as we have heard, we have been promised legislation only for it not to materialise.

As we have heard from a number of hon. Members— I have heard this graphically from the relatives of people who have died by suicide and from former gambling addicts—the business models of some gambling companies, and some gambling products, add to significant harms, leading to high levels of problem gambling, mental health issues and, sadly, suicides. Regulation is long overdue, particularly since the huge growth in online and mobile gambling. Smartphones give opportunities to gamble pretty much anywhere, anytime, and the unregulated online spaces fail to protect users.

As we have heard, the Gambling Act 2005 is the basis for the regulation of gambling in Great Britain, but it has not been updated since it was passed and it is not fit for the digital age. The key Conservative manifesto pledge in 2019 was to review gambling laws in response to mounting concerns about how this £14 billion-a-year industry is regulated. The White Paper was originally due to be published before the end of 2021. Labour has been calling on the Government to bring forward gambling legislation for a long time. In 2019, we also committed to introducing a gambling Act.

The delay in tackling this issue is costing money as well as lives. The Public Health England review found that the annual economic burden of harmful gambling is £1.27 billion. That is £647 million in direct costs to the Government and £619 million of wider societal costs associated with suicides. It is about not just lives but money, and we need to address that issue.

Will the Minister confirm when exactly we will see the White Paper? We definitely need to see it in the coming weeks. I agree with the hon. Member for Inverclyde (Ronnie Cowan) that we need to see it long before the summer so we can start discussing these issues. It needs to build on the consensus across the House that we need to bring this regulation into the digital age.

The all-party parliamentary group for gambling related harm, chaired by my hon. Friend the Member for Swansea East, who has campaigned magnificently on this issue, recommended a mandatory levy on the gambling industry to fund research, protection, treatment and education, and address gambling-related harms, including to consider the links between gambling and suicide. At the moment, as we have heard, gambling firms have no mandatory requirement to fund addiction research and treatment services. Many do so through the voluntary scheme, but it is variable and uncertain. That uncertainty makes it difficult to plan long-term projects.

The five big gambling companies have committed to paying 1% of their gross yields towards safer gambling initiatives by 2023, but the variation between online products and their donations is a real issue. The legal power to impose a levy on the gambling industry has existed since 2005, but it has never been used due to the Government’s insistence that the industry should support harm-reduction work on a voluntary basis. I think that the highest figure was last year, with £35 million coming through voluntary donations. It has been estimated that a statutory levy would increase that to around £140 million, but we must put that in perspective: the gambling industry spends £1.5 billion a year just on advertising. That is the scale of the issue. The Government must take this proposal seriously.

My hon. Friend the Member for Swansea East made the important point that a levy should be smart or differentiated to tackle the most dangerous forms of gambling without harming, for example, bingo halls. I should be grateful if the Minister would outline what consideration the Government have given the proposal. We need clarity about what will be in the White Paper and how a statutory levy might work. We absolutely need to tackle gambling harm across the board, so that the families of those who have been immeasurably harmed by gambling can have confidence that what has happened to their loved ones will not happen to others.

[Mr Clive Betts (in the Chair)]

May I ask the Minister to ensure that there are a couple of minutes left for the mover to reply?

10:41

[The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)]

Thank you, Mr Betts. It is a pleasure, as always, to serve under your chairmanship and I will ensure that there is time at the end for the hon. Member for Swansea East (Carolyn Harris) to reply. I thank her for securing the debate and thank all those who have contributed today, articulating a variety of views in a genuinely constructive manner. She has been a staunch campaigner for gambling reform for a very long time and I thank her and other parliamentarians for the many meetings that they have had with DCMS Ministers over recent months and years. As has been mentioned, I am not the responsible Minister for gambling: the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South (Chris Philp), is unavoidably detained in a Bill Committee but I will ensure that he gets a full read-out of today’s debate.

It has been 17 years since the Gambling Act 2005 was passed and it is clear that the risks around harm and the opportunities to prevent it are different now from when that legislation was introduced. We must act to recognise that our regulatory framework needs to change. In recent years, the Government and the Gambling Commission have introduced a wide range of reforms to help protect, support and treat people who are experiencing gambling harms. The protections include the ban on credit card gambling, the fixed odds betting terminal stake reduction and reform to VIP schemes, as well as ongoing work to improve and expand treatment provision through the NHS and third sector. The review is an opportunity to build on those changes and ensure that we have the right protections in place to prevent harm.

As the hon. Member for Swansea East will appreciate, I cannot pre-announce what will be published in the White Paper, which we are finalising, nor can I comment on speculation in the media and elsewhere about its contents. However, I can say that I absolutely recognise the importance of sufficient and transparent funding for research to strengthen our evidence base, as well as for treatment to help those who need support. As part of the wide-ranging scope of the review––it is widely recognised as being wide-ranging––we called for evidence on the best way to recoup the regulatory and societal costs of gambling. We have been clear for several years that, should the existing system of taxation and voluntary contributions fail to deliver what is needed, we would look at a number of options for reform including, but not limited to, a statutory levy.

As hon. Members know, when the Gambling Act was introduced, the gambling industry agreed to provide financial support for tackling problem gambling, and the Gambling Commission requires operators to make an annual contribution to approved organisations, which deliver or support research on the prevention and treatment of gambling-related harms, as a licence condition. We considered that issue closely in 2018 as part of the previous gambling review, when much of the debate centred on the quantity of funding provided by the industry. Since then, there have been a number of changes to how much is given and how it is managed.

Since 2018 the Gambling Commission has improved transparency around the amount given by the industry to research, education and treatment, and which bodies it is paid to, and required operators to donate to organisations approved by the commission. Most donate to GambleAware, an independent charity with no industry involvement in commissioning decisions, and the funding in the system has also increased substantially. In 2019, the four largest operators committed themselves to increasing their contributions tenfold, including £100 million for treatment over the following four years. I think the hon. Member for Manchester, Withington (Jeff Smith) mentioned that contributions under the voluntary system were indeed £34 million last year, and they are due to reach £70 million by 2024. By way of context, £34 million is about 0.3% of GGY, which is about £10.2 billion.

Alongside that, the Department of Health and Social Care and the NHS are taking forward work to improve and expand treatment provision. The 2019 NHS long-term plan gave a commitment to expand the coverage of NHS services for people with serious gambling problems and announced the creation of 15 specialist gambling clinics by 2023-24, with £15 million of funding over the same period.

As my hon. Friend the Member for Blackpool South (Scott Benton) and others have commented, there are five NHS specialist clinics in operation, with a further three due to become operational by the end of this month. The Department of Health and Social Care is working with the NHS and GambleAware to help to improve the join-up between NHS and third-sector services, and to develop a clear treatment pathway for people seeking help.

The hon. Member for Sheffield Central (Paul Blomfield) again raised the tragic case of Jack Ritchie. In March, the hon. Gentleman secured an Adjournment debate on the coroner’s finding that gambling contributed to Jack’s tragic death. As the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South, said then, the findings are an important call to action for our Department, the Department of Health and Social Care and the Department for Education.

As we said in our response to the coroner, the Government are committed to building on the reforms made since 2017 and addressing the concerns identified in the prevention of future deaths report. The coroner’s report and lessons arising from Jack’s tragic death are important inputs to our considerations and the review of the Gambling Act. I can assure hon. Members that, overall, the voice of people with personal or lived experience of harm was thoroughly represented among the submissions to our call for evidence, and I and my successors leading the review have met a number of people who have suffered because of their addictions or those of the people they love. I thank them for their contribution to the debate and the evidence gathering.

As part of the review, we are looking closely at the barriers to high-quality research, which were mentioned by many hon. Members, and how we can overcome those barriers. Building the evidence base to deepen our understanding of gambling can involve the input of a range of groups, including the Gambling Commission, researchers and the third sector. A good example is the research commissioned by GambleAware on the impacts of marketing and advertising on children and young people.

The research showed the impact that certain aspects of gambling advertising can have on young people, including depictions of the association between football and gambling, which I know is a hot topic. That pointed to the need for change to ensure that the UK advertising codes continue to provide effective protection from gambling advertising-related harms. The research has led to the Committee of Advertising Practice announcing stronger protections, which will be backed by the enforcement powers of the Gambling Commission. Those include banning content with strong appeal to children from gambling advertisements, as well as further changes to protect vulnerable people. Research on gambling, like any other subject, is funded by the research councils, and we want to encourage more researchers from a wide variety of disciplines to work in this area. We will say more about that in the White Paper.

I will briefly mention a few other points raised by hon. Members during the debate. The Gambling Commission has piloted a new methodology to measure problem gambling, and that is being worked on. The hon. Member for Strangford (Jim Shannon) mentioned gambling in Northern Ireland. Gambling is a devolved matter in Northern Ireland, but I believe new legislation is being brought forward there. I can confirm that officials have met to share experiences regarding the Great British legislation and regulations, so the conversations are ongoing.

On the effectiveness of GambleAware services, 70% of people who started treatment as problem gamblers were no longer defined as such on the problem gambling severity index at the end of treatment, and 92% saw their score reduced, so there is evidence of some impact.

Several Members raised the important role of the gambling sector’s tax contribution to the economy and the fact that those tax revenues are then used to fund our public services, including the NHS. Everybody has recognised, today or previously, that gambling can be performed safely by millions of people every year. Again, a very clear message from Members today is that nobody is advocating a complete ban on gambling. Of course, any changes must be proportionate and evidence- based, and where possible they must avoid unintended consequences.

The Government have an important responsibility to get reform right. We will build on the many strong aspects of our existing gambling regulatory system to make sure it is right for the digital age and the future. The White Paper is a priority for the Department and we will publish it in the coming weeks, which is precisely the wording that the hon. Member for Manchester, Withington asked for.

I thank all hon. Members for their contributions to today’s debate.

[Sir Iain Duncan Smith]

Will my hon. Friend define what “coming weeks” means? When is a coming week no longer a coming week? Is it two or three weeks ahead, or four or five? A little definition would help.

[Nigel Huddleston]

I can say no more than that we will be publishing in the coming weeks. I am afraid that my hon. Friend the Member for Croydon South is currently detained elsewhere, so the coming weeks is all I can say today.

[Ronnie Cowan]

I asked the Minister a question about section 123 of the Gambling Act. I do not understand why it has not been enacted.

[Nigel Huddleston]

The answer lies in the evidence given in the debate today. As I have said, we are looking at the Gambling Act review and considering the options and the arguments made today, but there is not 100% support for that at the moment. We committed to looking at that as part of the review, and I am afraid the hon. Gentleman will have to wait for the report to come out in the coming weeks.

I thank right hon. and hon. Members for their contributions. I will make sure that the Minister responsible gets a full report of today’s debate.

10:52

[Carolyn Harris]

I thank the Minister for his response. I thank all right hon. and hon. Members for their contributions today. I even thank adversaries; I hope we can find common ground on this issue. Every reform that the gambling industry has endured—it has been an endurance for it—has not been done voluntarily; it has come kicking and screaming. There are people here who are providing a voice for the industry. My motivation and that of others here is to provide a voice for those people at the back who have paid the greatest sacrifice. The status quo can no longer be allowed to continue. We have to ensure that the White Paper protects everyone in future from the same tragedy that those families have had to experience.

Question put and agreed to.

Resolved,

That this House has considered proposals for a statutory gambling levy.

10:54

Sitting suspended.

GPs and Primary Care (North East Bedfordshire)

Tuesday 7th June 2022 Westminster Hall

11:00

[Richard Fuller (North East Bedfordshire) (Con)]

I beg to move,

That this House has considered access to GPs and primary care in North East Bedfordshire.

It is a pleasure to serve under your chairmanship, Mr Betts, and to welcome the Minister to her place. The reasons for this debate are, in essence, two of the main commitments that I made when standing for election in 2019: to promote access to local services; and to maintain the rural character of North East Bedfordshire, in the light of high levels of persistent housing development stretching back over a number of years. Those issues are related, but each of them also has certain distinct resolutions.

What has informed me, in calling for the debate, is that over the past six months I have spent a considerable amount of time speaking to GPs and primary care staff across my constituency. I have listened to their points of view and analysed information from their practices. I commend the work of our GPs and their staff, most particularly in the period through covid. I will touch on some of my concerns about how GPs were feeling and about morale over that period when I talk a bit about the responses I have had from constituents in my email inbox.

The debate is also informed by previous debates about the impact of development and of population on access to health services, such as GPs and dentists, although the latter are not my primary focus today—I have participated in debates led by my hon. Friends the Members for Waveney (Peter Aldous) and for South West Bedfordshire (Andrew Selous). My inbox, however, has been full of emails from constituents on the issue of access to GPs.

This will be known to the Minister, but I always think it is useful for Ministers to hear directly from constituents, so I will briefly quote three of mine. One wrote:

“My wife is 75 and in acute pain. She can barely walk. Several days last week and yesterday she has been attempting to see a GP…she phones at 8 am and eventually gets through some 2 hours later. She is then told there are no appointments remaining that day!, and that she should phone the next day at 8 am to try again. This same pattern is repeated day after day. Hours and hours spent listening to a recorded message with zero result.”

Another constituent wrote:

“I am writing to you about the absolute terrible Healthcare Centre… I’ve phoned the surgery 3 times last week to be told they have no appointments…this is disgraceful. I rang again today to be told no appointments available again today and to phone 111. Apparently they have to hold appointments for 111 to allocate. The lady from 111…told me to go to A&E to sit there for hours on end to see a doctor”.

The third constituent wrote:

“I have tried phoning the practice at 8 am as told to in order to arrange a telephone conversation. For about 50 minutes the dialling tone cut off with a message saying the line was overloaded. Thus, redialling over and over again was necessary (not something it is pleasant to do when feeling unwell). Eventually you may get through to be told you are in a queue. When you finally get through to a receptionist you are told that GPs are only taking emergency calls. When querying what I should do now, I was told to try again tomorrow at 8 am.”

Such issues are, to a certain extent, part of the recovery from covid and of the post-covid period, but they also highlight issues of concern more generally. The Minister must recognise the irritation of my constituents at the requirement to repeat and repeat a process in order to do something as simple as seeing someone in primary care for their health needs. Further irritation comes from the pressure on the ability to find an appointment within a reasonable amount of time.

That also has a significant impact on the morale of staff in GP practices. Given people’s problems getting through, they are naturally at a rather heightened level of irritation, and that has often spilled over into abuse of staff. The Minister will agree that there is never a rationale or reason for any of us to be abusive towards staff who are trying to do their best.

I will share with the Minister some data on my area. As of April 2021, the patient-to-GP ratio of my clinical commissioning group area, which covers Bedfordshire, Luton and Milton Keynes, was ranked eighth highest of 106 clinical commissioning groups, with 2,169 patients per GP, against last year’s average of 1,772 patients per GP. I have looked at the data running back to 2014—I am grateful to the local medical council for helping me with it. From 2014 to 2022, the list size for GPs in my constituency—a subset of the clinical commissioning group area—grew by 13%, compared with national growth of 8%, so it is growing considerably faster than in other areas of the country.

Let us look now at personnel. For the same period of 2014 to 2022, the total headcount of qualified GPs grew by 2.1% nationally but fell by 2.2% in North East Bedfordshire. Over that eight-year period, the number of GP partners fell by more than a quarter. Those staffing numbers are troubling. The CCG area has 2,169 patients per GP, but for practices that serve my constituents the number is 2,482 patients per GP— up 28% in eight years. I point out to the Minister that housing growth in my constituency is already three times the national average. That problem will not go away, and nor will it stay the same; it is going to get worse.

I will go through some specific findings from my discussions with GPs. The first is fairly obvious: GPs—and I and my constituents—think that primary care in North East Bedfordshire is under severe strain. One GP told me:

“The vulnerability of the service provided by GPs in my area was off the scale large”.

I believe that my constituency is actually a test case for our Conservative manifesto commitment to infrastructure first. I will raise some points about that in a minute.

In my view, and in the view of the GPs with whom I have spoken, remuneration systems provide insufficient incentives for GP partners to take on additional responsibilities. If we wish to stem the decline in GP partners, the Government have to show by words, actions and remuneration that they value the additional work that partners take on to enable broader provision of primary care in their local practices. More generally, pay systems provide more reward, rather than less, for GPs who pick and choose their hours rather than work full time. On the issue of locums versus salaried GPs versus partners, what is the Government’s strategy and what is their preference? My view is that the partner model has worked well historically and is the best model for the future, and even if the Minister agrees, there should be some substantial changes to how the remuneration systems work.

The NHS provides practices with payments based on hitting specific targets set at a national level, or sometimes a local level, such as the qualities and outcomes framework and the investment and impact fund. I hear that some of those targets can be onerous and the benefit is outweighed by the bureaucratic cost of achieving them. I worry that there is a tendency to prioritise bureaucratic target setting and undermine the professionalism, integrity and insight of GPs. We have to recognise that GP partners are some of the best qualified people in the country. To drive them to little target boxes that they have to check is in some ways a little bit demeaning to what a GP thinks is best for their patient. I can see that there is a need, but I think that perhaps the Government are overdoing the balance, towards bureaucracy.

This is perhaps a very minor point, but to me it sounds quite significant if it is true. I was intrigued when I learnt that GPs cannot create a corporate shield against personal liability when they wish to become a leaseholder of property. Normally, if someone is in business, for example, and they are a director or chief executive, their personal liability is not put on the line for a lease that they sign. I was given this impression, and perhaps the Minister can write to me with an answer to this question: is it right that there is no personal liability shield on this issue? That seems to me an unnecessary disincentive to becoming a GP partner.

Increasing the pathways to contact GPs is significantly under way. These range from face-to-face consultations, to e-consultations, to phone consultations. This is currently adding to the frustrations both of my constituents and of some of my local GPs, but there are signs and reasons for hope that the change can be for the better. Some constituents greatly prefer the opportunity to have a phone consultation. Although 50% of phone consultations require a face-to-face follow-up, 50% do not. That creates opportunities for scale economies in telemedicine. One practice that tracks those changes very carefully has been positively encouraged by the reduction in missed appointments for face-to-face consultation, which is a real saving of GP time. I would encourage the Minister to pursue further those efforts for new pathways but to recognise that there will be teething problems as we broaden things out.

Similarly, the broadening out of clinical roles—particularly those of paramedics, nursing roles and other direct patient care positions—in primary care is generally welcomed by GPs, but they would make the point, and I make it to the Minister, that there remains patient resistance to seeing someone other than “my GP”, even if seeing them is not required, and that it can remain a bottleneck. Also, that will not be a full answer to the issue of GP access, even in the long term.

I also heard that the relationship between primary care and secondary care has become a little fraught post covid. I am not sure that it has always been the most harmonious, if I am being honest. But will the Minister look or has she looked at the additional roles that GPs took on during covid to relieve pressure on hospitals, to see whether the balance is right and whether the remuneration is still right or whether there needs to be some clarification on those roles?

Similarly, there is the issue of the relationship between GPs and pharmacies, specifically as regards regulatory intrusion on efficient communication and simple processes such as the issuing of prescriptions. I know that the Minister and Government are looking at that, but it seems to me, from what I have heard, that more progress can be made. That could have significant benefit in broadening the ways in which people can access primary care.

Customer service attitudes and procedures, particularly post covid, created widely different outcomes between practices. This was one of my two most significant findings. It really matters how the practice manager and the receptionist interact with the patients when they arrive or when they get through on the phone. It is interesting how some practices have done a fantastic job and some have fallen short—there is such a wide variety. I wondered whether there was training and protocols about that human interaction, to ensure that standards were kept up. A similar thing—this is the other thing that is most important—is phone systems. Who would have thought that a GP’s choice of phone system would be a critical factor in patient satisfaction with the service that they get? In my own constituency, there is one particular practice whose choice of system A rather than system B has created for it an enormously larger problem with its patients than other practices have.

The rate of population growth in North East Bedfordshire has been so high for so long, and I am afraid to report that I believe that the NHS has failed to keep pace with regard to the modernisation of premises, particularly ones that bring individual practices together. This will be my final and key point as part of my asks of the Minister. The slow pace of NHS performance has been further frustrated by inefficiencies of section 106 and community infrastructure levy payments. That is most vividly highlighted in my constituency by the plans for a new surgery to serve the villages of Biddenham and Bromham. The land was promised years ago, all the houses have been built and yet the building of the new practice has not begun. That is a crucial “infrastructure first” test case for the future.

North East Bedfordshire is already near to the top of ratios, and population growth at three times the national average means that, without action, the situation will get worse. I ask the Department to look at North East Bedfordshire as a test case for our manifesto commitment on “infrastructure first”; to go back over the past eight years, to identify lessons learned from the inability to keep pace in personnel, processes and facilities; and to map out what could have been done and what could now be done to improve the situation. I am asking for a specific test for my constituency for that historical analysis, and I hope the Minister will agree to that today.

Practically speaking, I also ask the Minister to get her Department to look at unblocking the jam on the hospital site in Biggleswade. It appears that Treasury restrictions, which are legitimate but causing a problem here, are blocking the transfer of facilities so that it can provide GP services in one of the fastest growing towns in my constituency. I have spoken with Central Bedfordshire Council, which is willing to fund the rebuild, but it needs more reassurance and flexibility on long-term use. Will the Minister please talk with her Treasury colleagues to enable progress, as that would be a vital element in relieving the strain?

There are similar issues at Great Barford surgery, which is still located in cramped facilities. Right across the road there is an available facility, which everyone knows is the right one and has been talked about for years. I ask the Minister to look at that issue and see whether it has to be resolved locally, between the council and the local clinical commissioning group, or whether the Department can assist. In closing, I am grateful to our GPs, who have worked, sometimes with hostility from their patients, exceptionally hard in my constituency in difficult circumstances. I am very grateful to them and their staff.

11:17

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

It is a pleasure to serve under your chairmanship, Mr Betts. I thank my hon. Friend the Member for North East Bedfordshire (Richard Fuller) for securing the debate and raising important points about the good work that is happening, as well as the substantial issues facing his GPs and constituents. I will not stand here and pretend everything is rosy: I want to work with him to address a number of the issues that he raised.

I start by thanking GPs, general practices and primary care for all their work during the pandemic, and for the work they are doing now, increasing their workload, such as dealing with people on elective waiting lists who need care because they are not able to get procedures done as quickly as normal, or helping with the covid vaccination booster. They are dealing with almost a tsunami of patients who are now coming forward to seek help, after we advised them to stay away and protect the NHS during the covid pandemic. We are seeing almost 11,000 cancer referrals a day, for example, and each one comes through a GP. On average, there are 1.6 million appointments nationally per working day, which is an increase of 5.3% on April last year, and 62.5 million covid vaccinations have been delivered by general practices.

That gives the scale of the work that has gone on, but I do recognise some of the issues raised. To reassure my hon. Friend, GPs—whether they are salaried or partners—are generally not directly employed by the NHS. They are independent practitioners who have a business of their own and have a contract to deliver NHS care. Some of those historical arrangements limit the interventions we can make, and some GPs want more integration than others—we have to be flexible in the support that we give.

My hon. Friend the Member for North East Bedfordshire is quite right to identify the issue of telephone access. I know from my own constituents that getting through to the GP is half the battle; once they have got through they usually have a positive experience seeing the GP, or other healthcare professional in primary care. We tried to help with this in autumn last year with the winter access fund. Part of that help meant that practices could bid for funding to introduce cloud-based telephony systems, which can transform the way that appointments can be made. My hon. Friend highlighted systems where GPs can see how many people are waiting on the line and how long they have been waiting for, and can divert resources to get calls answered quicker, even doing so remotely, with receptionists not having to work directly in the surgery to answer the phone, book appointments or organise prescriptions.

Cloud-based telephony is really transforming access to GPs. Unfortunately, some GPs are already signed up to contracts with other telephone providers that they cannot get out of, and some have signed up with other cloud-based telephony systems that are not as good as others, as my hon. Friend pointed out. NHS Improvement is working with GPs to drive full adoption of cloud-based telephony across the system. We are working with surgeries and sharing best practice of what really works. He is quite right that when patients are frustrated about not being able to get through they take it out on staff and GPs. To deal with the telephone access issue and make it easier to get through will transform the lives of both patients and staff.

We must also bust the myth around the 48-hour appointment model, which was in place under previous Governments, where patients had to be given an appointment within 48 hours. Patients had to phone up every morning and could only get an appointment within that 48-hour window. There is no need for that, and we are trying to say to GP practices that that is a historical model—they do not need to stick to it. Very often, a patient will be happy with an appointment next week, rather than having to phone up on the Tuesday, the Wednesday and the Thursday but still not get an appointment. There is a lot of work around practice management, and the systems in individual practices, that we are happy to help GPs with.

We are also working on the pharmacy consultation service, which has been used very successfully during the pandemic. If a patient phones 111, or the GP practice, there is a range of minor ailments that a pharmacy can deal with face-to-face, quickly and expertly. Those ailments, which range from sprains to colds and flu—even those patients with long-term conditions and on long-term medications, such as some diabetics or those with high blood pressure—can be well managed by a pharmacist. We want to go further with that and introduce more services provided by community pharmacists. We are in negotiations with pharmacy teams to see if we can do that. Scotland and Wales have a pharmacy-first system that works extraordinarily well; we are keen that patients in England have access to similar support.

We are introducing changes to the GP contract this year—some of those are more popular than others. For patients, one of the key elements is about extending opening times to evenings and Saturday mornings, to make it easier for patients to be able to see their GP if they need to. That comes on top of the point that my hon. Friend made about other healthcare professionals working in primary care. Primary care is changing dramatically. We have already recruited over 18,000 additional primary care professionals, such as nurses, physios, pharmacists and paramedics, who are often better placed than the GP to provide the care and support a patient needs. My hon. Friend is quite right that there is sometimes a reluctance from patients—a feeling that they are being palmed off on someone else rather than seeing the GP. However, we are finding that once they have seen the paramedic or the physio, they are very pleased to see that professional the next time an appointment is offered. We are hoping that the take up of that will improve.

We have a commitment to recruit 26,000 more healthcare professionals by 2023-24 in addition to the GPs. We are on track to meet that, so that primary care becomes a multidisciplinary experience for patients, and it is not always the GP who they need to see first. However, as my hon. Friend says, we do need more GPs, and a record number of 4,000 doctors have taken up GP training posts this year, which is a real boost to the numbers, but I recognise that they will take several years to be trained and to come through.

Although my hon. Friend speaks well about the pressure on whole-time equivalents, his local clinical commissioning group allows GP registrars to see patients, which boosts patient appointments and capacity in the local area. He will be pleased to note on housing—again, my constituency in the south-east has similar problems, where housing developments are in their thousands rather than their hundreds and spring up overnight with no consultation with the local GP, who then has to take those patients on—that I am meeting the Housing Minister, my right hon. Friend the Member for Pudsey (Stuart Andrew), this month to discuss the very issues my hon. Friend raises about primary care being a key feature during planning and when things such as section 106 and community infrastructure levy money is being allocated. As he rightly says, the health centres need to be built first before the housing.

[Richard Fuller]

I am delighted that the Minister is taking such an active interest in the impact of development on access to services. In my speech, I requested that, ahead of my meeting with the Secretary of State, the Department look back at that history in my constituency as a test case to see what could have been done differently and what might be done now. Will she commit to that being done ahead of my meeting with the Secretary of State?

[Maria Caulfield]

I am not sure when my hon. Friend’s meeting is—I think it is fairly soon.

[Richard Fuller]

July.

[Maria Caulfield]

It is in July. We can certainly look at that, because we need to look at the lessons learned if we are to make progress going forward. The Housing Minister is keen to address this problem, so it is good to look at what has not happened in the past that should have, so we can take that forward. I cannot commit 100% to that being ready for my hon. Friend’s meeting, but we can certainly look at it.

The final point was on the GP partner model and support for GPs in their role and in some of the challenges they face, whether that is taking on premises or taking on liability. There is definitely a trend where partnership numbers are going down, but salaried GP numbers are going up. That is because younger GPs coming forward often do not want to take on the responsibility of being a partner and everything that entails, but partners feel that being bought into the practice gives them a huge amount of additional investment in terms of time and finance, as well as guidance, development and support for patients.

The Secretary of State has instigated the Fuller review—that is not my hon. Friend, obviously, but a GP—around the future models of GP practice, and whether that is partnership or salaried or whether there are different models available. We will take a good look at those recommendations because there may not be a one-size-fits-all solution. Some partners have a definite view of where they want to go; others are struggling and need support and help. I do not think it will be that one size fits all, but the Fuller review will certainly make some strong recommendations.

I hope in the short time we have had that I have been able to acknowledge the main challenges my hon. Friend’s constituents and GPs are facing and have outlined some of the measures we are taking to support primary care and enable patients to see their GPs more quickly and easily, whether that is virtually or face to face.

Question put and agreed to.

11:30

Sitting suspended.

Neighbourhood Plans

Tuesday 7th June 2022 Westminster Hall

[Ms Nusrat Ghani in the Chair]

14:30

[Dr Luke Evans (Bosworth) (Con)]

I beg to move,

That this House has considered the role of neighbourhood plans in national planning policy.

It is a pleasure to serve under your leadership today, Ms Ghani. I thank the staff in Westminster Hall and colleagues who have come to speak in this important debate.

The public often do not think about planning as imperative to their lives, but it is something that happens to them all the time, whether they are conscious of it or not. People are usually only conscious of planning when it is pressed on top of them, and that is an important principle for us to think about. At the heart of this 90-minute debate is neighbourhood plans, which give local people the chance to take control of how they see development in their area. I think it would be useful to set out where neighbourhood plans came from, the problems with them and, most importantly, their future.

If we look at the history of neighbourhood plans, we see that the Localism Act 2011 allowed them to be brought forward. That Act allowed parishes and neighbourhood forums to develop neighbourhood development plans and neighbourhood orders. Neighbourhood plans were about the use and development of land, and they would contain a vision, aims, planning policies and proposals to improve the area, provide new facilities or allocate key sites for specific development, with a possible focus on social, economic and environmental issues. Neighbourhood development orders were for parish or town councils, or neighbourhood forums, to grant planning permission for certain kinds of development within a specific area. This was all held together with the legal framework— section 116 of the 2011 Act—that brought into effect schedule 9 to that Act and inserted into the Town and County Planning Act 1990 schedules 10 and 11.

The main object of neighbourhood plans was to guide and shape development in a particular area around national policies, while conforming to local strategic policies. Changes in the Housing and Planning Act 2016 and in the Neighbourhood Planning Act 2017 sought to simplify and speed up neighbourhood planning processes, and allowed for greater intervention by the Secretary of State in the process of making neighbourhood plans. Further still, in the Housing and Planning Act 2016, local planning authorities were required to make both neighbourhood development plans and neighbourhood development orders

“as soon as reasonably practicable after the referendum is held”.

There was a further update in the Neighbourhood Planning Act 2017, allowing neighbourhood plans to be modified and dealt with in situations where a plan is needed but covering slightly different geographical areas from the previous one. Finally, changes to the national planning policy framework in 2018 mean that neighbourhood plan policies for the supply of housing should not be considered out of date if the plan is less than two years old.

That is a little bit of background about neighbourhood plans and where they are at, but it is worth giving an overview of the process of getting a neighbourhood plan up to date. Draft plans and orders must pass an independent check and then be put to a local referendum. If there is a majority vote in favour, the local planning authority must adapt that plan, subject to legal compatibility.

The LPA has a statutory role to support neighbourhood planning, such as by undertaking independent examination of the neighbourhood plan, and it runs neighbourhood planning referendums. The Government state that neighbourhood planning should not be a way to block necessary developments. Neighbourhood plans should support the strategic needs set out in the local plan, and they cannot promote less development than is set out in said local plan.

Neighbourhood plans can allocate sites additional to those set out in the local plan and propose sites different from those in the local plan, in discussion with the LPA. The plan can identify areas for protection, such as open spaces valued by the community or green spaces that meet local green space criteria.

That is where we have come from and, broadly speaking, it is a great approach to take forward. I think most in the House would agree that the principles enshrined in this legislation are moving in the right direction, but what is the reality we are living with at the moment? It is fair to say that neighbourhood plans are not for everyone, nor should they be. Communities should want to come forward to design and shape the planning of their community —in essence, the shape and feel of what they have.

In my area of Bosworth, many groups have come forward by choice to make a difference and take responsibility for their local planning area. A second reason for doing so is necessity, because the system is failing. There are no protections, because we do not have an up-to-date local plan. Let me explain what we are living with at the moment. I have two tiers of council: a county council and a borough council. The borough council is responsible for the local plan, but the county council intersects with the infrastructure and the signing off of that plan, and this is all done through the framework of national planning.

Planning is a very difficult issue for an MP. The most common issue in my inbox is inappropriate development in my area. At the same time, people ask me to step in and make changes to individual planning applications. We all know that an MP cannot do that. Without an up-to-date local plan, it is open season in my area. It is a desirable place to live, set perfectly in the heart of the UK. Quite literally, we have the middle of England in my constituency. We have beautiful rural countryside and we are close to the city of Leicester, so the area has a lot to offer. The problem is that with a piecemeal approach to planning, we have huge problems to solve with infrastructure and providing the amenities and services we need.

Across the House, we all agree that nationally we need more houses, but that message seems to have been lost locally, with the Liberal Democrats saying that the issue is the Government’s agenda of putting in 300,000 houses. However, in the “Access to Affordable Housing” section of their 2019 manifesto, the Liberal Democrats state that they will:

“Build at least 100,000 homes for social rent each year and ensure that total housebuilding increases to 300,000 each year.”

[James Gray (North Wiltshire) (Con)]

My hon. Friend makes an important point about the Liberal Democrats and the fuss they make about all this. Is it not disappointing that no Liberal Democrat Member has chosen to come to this extremely important debate on the subject?

[Dr Evans]

My hon. Friend aptly points that out, and I am glad that it will be recorded in Hansard for anyone who may come across this debate.

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

Does the hon. Gentleman acknowledge that there is somebody from the Opposition who has come to support today’s debate, and to show Labour’s position on supporting planning and ensuring that it is affordable?

[Ms Nusrat Ghani (in the Chair)]

I would point out that you have just arrived in the Chamber. You have made an intervention straight away; are you going to be speaking later on?

[Taiwo Owatemi]

No.

[Dr Evans]

I am hugely grateful to the hon. Member for Coventry North West (Taiwo Owatemi) for pointing that out. I believe that my hon. Friend the Member for North Wiltshire (James Gray) was referring to the Liberal Democrats, who I quoted in my speech. It is fantastic to see a Labour counterpart here to take part in this debate. This issue is important to all our communities, no matter which party we represent, and I am eternally grateful to her for being here to hear what we have to say.

I raised the point I was making because of the essence of our housing system. We need the right houses in the right place, with the right infrastructure and the right protections for our heritage and environment. We need houses that families can aspire to. In my area, more importantly, we need houses that the elderly generation can downsize to. We are struggling with both of those, not just in my area, but across the country. If we do not get this right, we risk losing our vibrant, rural aspects to suburban sprawl, with no thought given to where it should be. Piecemeal development does not help anyone—from schools to infrastructure and amenities, such as doctors surgeries—when we know that the country is under pressure.

How do we take this forward? Neighbourhood plans are a good way to help. This is where national policy intersects with localism, and rightly so. In my constituency, I have vanguard neighbourhood plans, such as in Market Bosworth, which has led the way for years in developing its plans. Various other areas, such as Markfield, Stoke Golding and Burbage, are all at different stages of working their way through their neighbourhood plans.

I am eternally grateful to the councils and individual constituents who have taken the time to go through what is, at times, a laborious, technical and painstaking process to try to get a result. What infuriates them more than anything else is that this has been ridden roughshod over because we do not have an up-to-date local plan. We must find a way to try to strength neighbourhood plans. In answer to the question:

“Can a Neighbourhood Plan come forward before an up-to-date Local Plan is in place?”

the House of Commons Library states:

“Where a neighbourhood plan is brought forward before an up-to-date Local Plan is in place the qualifying body and the local planning authority should discuss and aim to agree the relationship between policies in…the emerging neighbourhood plan…the emerging Local Plan…the adopted development plan…with appropriate regard to national policy and guidance”.

There is a framework there, but I question what that looks like in reality.

If only there were a legislative vehicle coming forward that could make a change. Well, it just so happens, as the eagle-eyed among us will have seen, that a Bill is being introduced tomorrow that will try to pull together and streamline 70 years of a fragmented planning system. I am pleased to see that this is taking place. There is lots to like in the Levelling-up and Regeneration Bill: simplification, design codes, choices opening up for developers and stopping land banking. Many of these matters go far wider than today’s debate, but there are five guiding principles. Hon. Members who have heard me speak on planning may argue about the acronym with the Secretary of State, but I will not be going there today.

The aim of the Bill is to support local communities to have control over what is built, where it is built and what it looks like, and to create an incentive for developments to meet set standards, with the aim of developing high-quality design and beautiful places and to protect our heritage. The Bill will enable the right infrastructure to come forward where it is needed, enable local democracy and engagement, foster better environmental outcomes and allow neighbourhoods to shape their surroundings, because that is where the impact of planning is most immediately felt. The last point is really important, and it is why I have called the debate.

In among those details, the Bill says that local plans will be given more weight when making decisions on applications, and the same weight will be given to other parts of development plans, including neighbourhood plans prepared by local communities. There will be opportunities for communities and interested parties to influence and comment on the emerging plans, which will be supported by digitalisation to ensure plans and data are accessible and understood easily. It will ensure that neighbourhood plans are given weight in planning decisions and in the development of neighbourhood priorities, with a statement to be taken into account when preparing the local plan.

Additional parts of the Bill state that neighbourhood plans will focus on development and use of land that contributes to the mitigation of, and adaptation to, climate change. That is done through a neighbourhood priority statement, which will set out the prevailing view of the community in a neighbourhood area on local matters including development, housing, the natural environment, the economy, public space, infrastructure, facilities and services in the area.

This is the prime evolution of where we are going with localism and neighbourhood plans, and I am pleased to see it. I would be more pleased if the Minister addressed some of the areas I have mentioned and talked about what the system will look like. We need to ensure that when it is working well, it runs at its full potential. Even more so, we need to know what it means for a community such as mine when the system starts to fall apart.

In closing, we have seen where the evolution of neighbourhood plans has come from. I have touched a little on the problems that we face when things do not go quite to plan—pardon the pun. Of course, we have opportunity for the future. I think we can all agree, yet again, that we need the right houses in the right place, with the right infrastructure, and the right protections for our heritage and environment. I would be grateful for the Minister’s response.

[Ms Nusrat Ghani (in the Chair)]

I call Sir James Gray.

14:45

[James Gray (North Wiltshire) (Con)]

I am most grateful to you for your chairmanship, Ms Ghani, and for promoting me. I am, in fact, just Mr James Gray at this stage, though you never know; it might be in the post. It is most kind of you, none the less.

[Ms Nusrat Ghani (in the Chair)]

I withdraw my Sir from the record.

[James Gray]

It is a great pleasure to serve under your chairmanship. My congratulations to my hon. Friend the Member for Bosworth (Dr Evans) on securing the debate, and on explaining what is often an abstruse, complicated and difficult area, in the clearest and most sensible terms. The way he framed his speech was extremely useful, and it will be well read up and down the country by local authorities and others who are considering neighbourhood planning.

I agree with my hon. Friend that planning should be about how many houses and where. I would add “and when”, because the timing of development is extremely important. I am a strong supporter of neighbourhood planning, and I had the great luck to be here in 2011 when the Localism Act was one of the first to be passed by the coalition Government.

We brought in neighbourhood planning, because we felt that decisions about planning should be given to the lowest possible level. We thought that local people should be allowed to decide what houses they want, where and when, as well as what the rest of the neighbourhood should look like. I am glad that Malmesbury in my constituency was one of the first places to spend an enormous amount of time and effort on bringing forward a neighbourhood plan. It is a very good document that works extremely well, and many other places around the country have based their neighbourhood plans on the Malmesbury example.

Neighbourhood planning is a great idea that I strongly favour, but I have three little reservations, which the Minister might be able to answer in his wind-up. Alternatively, he might be able to include some of these notions in the amendments that are no doubt coming forward to the Levelling up and Regeneration Bill, which, as my hon. Friend the Member for Bosworth said, starts its progress through Parliament tomorrow.

My first reservation is that in neighbourhood planning, there is a presumption in favour of expansion. It is not possible for any neighbourhood to say, “We like it precisely as it is today. We want no more houses. We do not want any change. We would like it to stay as it is.” No matter how beautiful, how perfect or how remote the neighbourhood may be, the neighbourhood plan, by definition, presumes that there will be growth.

The neighbourhood plan people go around and have the following conversation with people in their houses. “How many children have you got? Would you like them to remain in the village?” “Oh, yes, I would.” “Are there any houses?” “No, there are not, because in this village every house costs £1 million, and there are no houses for them at all.” “Oh, jolly good. Three children; that’s three more houses for this village.” The neighbourhood plan writes into itself a presumption in favour of growth. In some places, that makes sense. If there is a way to bring in low-cost housing for local people, that is much to be desired.

None the less, the principle of looking simply at the number of children under 10 in the village and working out from that how many houses will be needed in 20 years’ time is totally flawed. Like it or not, our children tend to go off to the nearest big town or city and will not remain in a remote little rural village. The houses built on that presumption tend to be three, four or five-bedroom houses for executives who come in from elsewhere. It is no longer about low-cost housing for local people. It becomes an unreasonable development of that area. That is my first reservation: neighbourhood planning presumes growth in the number of houses, and I think that is wrong.

My second reservation is perhaps easier to deal with, and my hon. Friend the Member for Bosworth touched on it briefly. Under revisions that were made to legislation in 2018 or 2019, the Government brought in the stipulation that the neighbourhood plan is valid for only two years. That might have seemed a good idea at the time, but it takes about two years to develop a neighbourhood plan. By the time it comes to the consideration of a big planning application of the kind that we see across Wiltshire at the moment, the neighbourhood plan is out of date. There is no point in having it if two years later we say, “It is no longer an important document.” All of the thousands of person hours put into creating a neighbourhood plan in the first place are, by that means, wasted. We should look again at the stipulation of a two-year limit on the validity of a neighbourhood plan. We could perhaps reverse it and say that the neighbourhood plan will be valid unless local people ask for it to be changed, and that it remains valid not for all time but perhaps with a 20 or 30-year limit, so that by and large the neighbourhood plan becomes the rule.

My third reservation about neighbourhood planning is slightly more complicated, but I will take the example of my hon. Friend the Member for Bosworth and try to make this as straightforward as I possibly can. It is a consistent problem in Wiltshire. The five-year housing land supply figures that are used in considering whether an application should be allowed are based on the completion of estates in the area. In other words, if the planning inspector is worried about it and Wiltshire Council is correctly concerned so it turns down an application for a big development, the inspector will then look at the five-year housing land supply figure, which I will come back to in a second, and almost inevitably find in favour of the developer. There is a big presumption in favour of the developer under those conditions. That of course means that Wiltshire Council lands up paying the barristers’ fees, which can often be substantial.

Unsurprisingly, officers have been correctly saying, “We must be very careful as councillors. We must not allow you to turn something down if we believe you will then lose at appeal.” That is where, as my hon. Friend the Member for Bosworth says, the local and the national intertwine in the person of the planning inspector, who considers the rules under the national planning policy framework, and by and large they tend to favour the developer.

I mentioned in passing the notion of the five-year housing land supply figure. This is a complex area of the law, but the law states that the local authority is required under the local plan to make available enough housing land that is readily developable for five years. If that figure is based, as I understand it is, on completions—estates that are completed—we are by definition writing into the law a presumption that the developer will not complete it. We see that all the time in Wiltshire. Developers go out of their way not to complete the development, not to provide the primary school that was part of the section 106 agreement, and not to complete the number of houses. By that means they can say that the development has got 500 houses, that it is not complete, and therefore it does not form part of the five-year housing land supply. That means Wiltshire Council has consistently got 4.6 years and 4.8 years rather than five years, and that means the inspector will then always say, “The developer has it. The developer will get it because Wiltshire has not completed the five-year housing land supply figure.”

The situation is unfair because we have written into the system a presumption in favour of developers not doing what they ought to be doing and completing the estate. A simple change would correct that: instead of the figure being based on completions in an area, it could be based on planning permission granted on land. If every time a developer who had a completable application granted said, “I am going to build 500 houses on that piece of land there and I can demonstrate it can be done”, that should count against the five-year housing land supply, which would then mean that Wiltshire, for example, would have something like a six-year housing land supply and therefore local people could decide where and when they wanted the housing.

At the moment, the neighbourhood plan is a worthless piece of paper. All that happens is that local people say, “We want housing there and there”, but an inspector says, “I am very sorry. With the five-year housing land supply, your neighbourhood plan is a waste of time. It is a worthless piece of paper and I am going to overrule you. And not only that; I am going to give you £100,000-worth of barristers’ fees against the council tax payer”, and of course the council does not want to do that.

Now is the time to change, probably under the new Bill. The Minister might like to consider very carefully this question of the five-year housing land supply, detailed as it may seem. I may be proved wrong—I am no expert in these matters—but there is a straightforward and simple way of correcting things. Instead of the five-year housing land supply being based on completions, it could be based on developable planning permissions granted.

I again congratulate my hon. Friend the Member for Bosworth for calling this excellent debate. It is a terribly important time. We have to supply houses for our people. The Conservative Government’s plan to provide 300,000 houses—if I remember rightly—is extremely good, and we have to find a way of doing that. We have a great problem with homelessness and the lack of housing. The question, though, is where those houses should be and when they should be built.

At the moment, the planning system does not take account of local interests and beliefs and neighbourhood planning. It takes account of nationally set targets, which tend to trump the wishes of local people. I very much hope that during the passage of the Bill, which will start tomorrow, the Government will consider some of these detailed points and change the Bill in such a way as to ensure that the interests of local people are looked after when we decide how many houses will be built and when and where.

14:55

[Jim Shannon (Strangford) (DUP)]

Thank you, Ms Ghani. It is a pleasure to be called and to follow the hon. Member for North Wiltshire (James Gray). His contribution was full of personal experience and knowledge. His input to this debate, for Hansard and for the Minister, in particular, is one that cannot be ignored. I say that in all honesty because there is a depth of knowledge in his speech and we should all take note.

I congratulate the hon. Member for Bosworth (Dr Evans) on securing the debate. Although the subject is a devolved matter in Northern Ireland, I try on all occasions to come to Westminster Hall to support those who have secured debates and to add a Northern Ireland perspective. I have had a particular interest in planning for umpteen years. I served on Ards Borough Council for some 26 years. I started in 1985—a long time ago. Planning was one of the major issues, so I have a real, deep interest in planning matters. That is why, when I saw that the hon. Member for Bosworth had been granted this debate, I wanted to come along and make a contribution.

From the outset of this debate, it is clear that our differing planning systems mean differing strategies. However, underpinning our planning systems is the fact that we move with the times and build in our expectations. I have worked on planning over the years, both as a councillor in a previous life and in the Northern Ireland Assembly, where we were responsible for some planning matters, although planning is devolved in its entirety to the councils. I think the hon. Member for Bosworth referred to the two stages of planning—local and county level—but in Northern Ireland, the councils control all of that: the local part and the strategic part, ensuring that the development is done in the right way.

I chair the healthy homes and buildings all-party parliamentary group. In my capacity as chair, I understand the need for people to have better homes. The hon. Member for North Wiltshire is correct: the Government have the responsibility to provide homes. This Government have made a commitment to build homes, which is something I support. I support that back home, as well. Very often, we are given a choice betwixt a rock and a hard place, because developments and houses are needed. I will give some figures in relation to that later on. The APPG focuses on the need to build modern, efficient homes, with amenities included, where access to schools and GP surgeries is in place and the road structure is there. That is all part of it.

Back home—I suspect it is not any different over here—when it comes to developments, there will be a big input from the developer. When it comes to building roads, the developer will not be seeking help from the road services—back home, the input and responsibility for the roads is on the developer. If it has to set aside provisions for amenities, such as playgrounds, the responsibility will be on the developer. The council will agree the plans and the structure, but it will not agree when it comes to spending money. The developer will be responsible. That is why the input from the developer is so critical, and why it has to be in partnership and co-ordination with local councils as well.

I am very blessed—I say this often, and I mean it—to represent what I believe is the most beautiful part of the United Kingdom. With rolling green fields, crashing waves, tranquil scenic beauties and wonderful historic sights, that is Strangford. Anyone who wants to come and visit is very welcome to do so. Anyone who wants to come and visit is very welcome to do so. I am sure other Members will say that their constituencies are equally beautiful, but I love mine.

However, with that beauty comes a lot of responsibility, and our planners often err on the side of caution when it comes to approvals. While I agree with that in areas of outstanding natural beauty, as is the case where I live in the middle of Strangford, when we have sites on the periphery of towns it makes sense to design and create all-purpose neighbourhoods. That is the whole point of this debate and that is why I agree with the thrust of what the hon. Member for Bosworth was putting forward.

New developments, by their very nature, put pressure on facilities, so it is important that hat is sewn into that structure and strategy early on. I recently spoke in this place about difficulties GP practices were having in expanding to provide a holistic approach. This morning, the hon. Member for North East Bedfordshire (Richard Fuller) referred to access to GPs, saying that in his constituency GPs had 500 or 600 patients more than the national average. He was clearly illustrating, from his point of view, that there was a need to have a certain level of GP access.

Having clinicians, nutritionists, mental health teams and physiotherapists in one place is what GP surgeries need to be. It is such a straightforward issue, because with full coverage comes less pressure on hospitals and better provision, yet none of this is a material planning consideration. The hon. Member for Bosworth says it should be, and I agree wholeheartedly.

Neighbourhood planning is the answer, and that is why this debate is important. I am not surprised that Government research from 2015, using a small sample of neighbourhood plans, suggested that areas with a plan in place saw a 10% increase in housing allocations over that provided by the local plan. That is an indication of where we are. The always helpful Library briefing highlighted that research

“by planning consultancy firm Turley from 2014 found that more than half of the draft plans published for consultation had ‘protectionist’ agendas and that many were openly anti-development.”

I would not adopt that attitude; I think it is important that people have an opportunity to buy an affordable house, perhaps where they were brought up. The possibility of someone’s children buying a house in a village where the hon. Member for North Wiltshire said houses were in the higher bracket of close to £1 million would mean they would never get one. This is about affordable housing and how to achieve it.

It seems that the Northern Ireland problem is, in fact, a UK-wide problem as well. What the hon. Gentleman and others have referred to is not unique to the UK mainland; we also struggle with it in Northern Ireland. I long for the days when sensible planning comes into play and when developers do not have to spend tens of thousands on the application process, which could be spent on ensuring play parks within developments and units for GPs or pharmacies and other such essential and desirable community facilities.

Through my time as a councillor and an alderman, I am aware that the council did not have early control over all development issues and planning applications. That was done by the road service and a different planning department in Downpatrick. Then, whenever the reorganisation of the council took place, after my time, planning in its entirety fell on the shoulders of local planners. In my past life, I was able to have a monthly meeting with local planners and have a frank discussion on the applications, which I found incredibly helpful and which developed my knowledge of the process. The planning officer would have said to me on a regular basis that a planning application could not go through or another would not work, so it was then about finding a solution.

Life is all about solutions, and this is about trying to find a medium between what is achievable and what people will settle for. I accepted the planning officers’ conclusions because I thought that, ultimately, the responsibility lay with them. If they changed this or that, we could work with that, or if we thought we could do something differently, we used to be able to discuss and find a way forward. I long for those days again. They will not happen, because I am no longer in the council and therefore my input into those processes is from a different level as an MP. I would love to work alongside a department that would seek a way forward and not automatically refuse.

The waiting list for priority, affordable housing in my council area—just in my main town—stands at 3,000. There is a big onus on us, back home, to perhaps look at how we can provide social and affordable housing. We must get that sustainable, affordable housing in place, and working with developers and local communities is the only way to achieve that.

That is why this debate is important, and why the input from the hon. Member for North Wiltshire is so important. It adds knowledge to this debate, which I think helps to formulate a strategy. It is fortunate that the Bill is coming to the Chamber tomorrow—this is a preview of tomorrow. I am pleased that the Government, I think, have grasped this one. I hope that the strategy is one that works. I will watch it from afar because I hope that we can replicate it, in a way, and do something similar for Northern Ireland.

[Ms Nusrat Ghani (in the Chair)]

Thank you, Mr Shannon —a vital contribution, as always. I call Mr Anthony Mangnall.

15:06

[Anthony Mangnall (Totnes) (Con)]

Thank you, Ms Ghani. It is a pleasure to serve under your chairmanship, and it is always a pleasure to follow the hon. Member for Strangford (Jim Shannon). As others have done, I start by congratulating my hon. Friend the Member for Bosworth (Dr Evans). He is well known in this place for being rather good at self-promotion, not least through TikTok. He has campaigned on several important issues, not least on body imagery, but he has once again brought to the forefront an important topic, which, while dry and often perceived as quite dull, he has managed to make interesting. To reference his own speech, he has given a speech at the right time, in the right place on the right topic, and I do not think that any of us will be disagreeing with the contents of his speech.

[Ms Nusrat Ghani (in the Chair)]

Order. Mr Mangnall, I believe, for the record, that the Minister will consider his portfolio to have always been interesting.

[Anthony Mangnall]

I beg your pardon, Ms Ghani. However, of course, this is a matter that we are now allowed to discuss, both today and ahead of the Levelling-up and Regeneration Bill tomorrow. This is an important point, because we, as Members of Parliament, are sent to this place on the back of our constituents and we engage with them on a regular basis through our surgeries. I suspect that I speak on behalf of all Members in this room when I say that planning, neighbourhood plans and development are things that continually drop into our mailbags or inboxes. It is of the utmost importance that, while in many scenarios, we are not able to engage quite as much as we would like, we now have the perfect opportunity to give them the voice to be able to stand up for what they care about.

As has already been mentioned, the Localism Act 2011 gave communities the power—the voice—to speak up for what they want in their local area. You may call me old fashioned, Ms Ghani—or perhaps not—but I am one of those old-fashioned Members of Parliament who happens to believe that decisions are made better in local areas by empowered local communities, and in the idea that Westminster and Whitehall do not know better on the needs of my towns and villages than my parish councils, my neighbourhood plan conveners, and my local council in some instances. It is that concept that I want to speak about in this debate.

The Localism Act created the hunger, the drive and the determination for every single member of the community to be able to speak up for what they wanted in their area, to ensure that they could have the right buildings in the right places, designed in the right way, and that the infrastructure would be in place and their community needs would be met. We have that opportunity tomorrow, in the Levelling-up and Regeneration Bill, I hope. I think it is worth pointing out that the Bill does enforce and enhance certain aspects of the neighbourhood plans.

I have gone through the Bill and I am looking forward to debating it with the Minister and the Secretary of State tomorrow. However, in clause 88, we have a strong opportunity to look at how we can write into law, from the Localism Act, the way in which we can strengthen those neighbourhood plans. That will allow us to allocate land for development and to detail infrastructure, affordable housing and design requirements. Those are three of the many other options that are to be included in the Bill tomorrow, and they are to be welcomed, because we need to set the standard we expect for neighbourhood plans, to make sure there is commonality but also a unique perspective from every neighbourhood plan, so that people are able to present what they want in their area.

But—there is always a “but” in these instances—the problem is that there needs to be support to help neighbourhood plans to come together and be written. All too often, a neighbourhood plan is put together and the small mistakes made by volunteers, who are working incredibly hard, are exploited by the developers—something I shall come to in a second. If there is to be support, it has to be centrally provided and not come from local authorities. We must put the responsibility on central Government to help provide that support, rather than adding to the workload of local authorities. Indeed, a perfect example of how we are encouraging and enhancing local communities’ power and the strength of their voice is through street votes. As I mentioned to the Secretary of State before the debate, it is no good having a placeholder amendment in the Bill for street votes. We need more detail to make sure that we can reassure colleagues, as well as constituents, about this matter.

The challenges are many, but I will stick to just a couple. The first is around neighbourhood plans versus the Planning Inspectorate. These plans are hard to create. We have all spent time reading neighbourhood plans, and we have all gone through them with our communities and villages. We have seen our communities hold referendums on these matters, and we know how hard they work. Recently in my constituency, Dartmouth and Strete have both had referendums, and they have produced genuinely high-quality neighbourhood plans. Volunteers worked tirelessly to produce those plans in the first instance, but it does not strike me as particularly effective to encourage people to produce neighbourhood plans if those are just thrown out after the first challenge from a developer or local authority, or if the Planning Inspectorate ignores what is in those plans.

We have to think hard about how we provide support for neighbourhood plans in the future, so that people cannot be bullied and downtrodden by developers with expensive barristers, or by planning inspectorates that end up listening to the person who is paid £500 an hour rather than the local volunteers, who are doing it out of charity for their community. I have gone in front of the Planning Inspectorate on no fewer than three occasions to try to stand up for local communities. Sadly, I am not a barrister being paid £500 an hour—[Interruption.] It could happen, I suspect. However, I did the best I could to stand up for my communities and what they wanted to see. We need to make sure that neighbourhood plans are ringfenced and secure, and that where support is necessary, we can provide legal advice against planning inspectorates in certain circumstances. It is a modern-day David and Goliath story—one that I think the Minister understands and that the Secretary of State certainly understands, and one that we can address in the Bill tomorrow.

How we support neighbourhood plans has to change, and my hon. Friend the Member for North Wiltshire said that we must find the balance and retain that important local voice. I have already cited the fact that we have had good referendums on two neighbourhood plans in my constituency, but there are two further examples, in the form of Collaton St Mary and Inglewood, where communities put together fantastic local plans. They understood what the affordable housing level would be, where the infrastructure would go and how the houses would be built—only for those plans to be completely overridden and their views ignored. Eventually it got to the Planning Inspectorate, and the decisions went against them. I hope the Minister will give me an answer, because I do not know what to say to them when they come to see me and say, “We put all this effort and hard work into a neighbourhood plan, in the expectation that we would be listened to, that this was us stamping our mark on our village and community and that we would get what we want. We are not nimbys. For that matter, we are not BANANAs”—which means build absolutely nothing anywhere near anybody—“We are people who want to build houses so that people can live in our area, work in our area and have primary residences.” They are now deeply upset and have lost faith in the system.

[Taiwo Owatemi]

The hon. Gentleman is making an important point about ensuring that residents are empowered and listened to with regard to local plans. In my constituency, areas such as Eastern Green, Holbrooks and Allesley are feeling very frustrated by the fact that every time they bring up suggestions about the local plan, developers are listened to rather than them. Does the hon. Gentleman agree that it is important that we prioritise the views and needs of local people over those of developers?

[Anthony Mangnall]

I thank the hon. Lady for her intervention. That is exactly the point: localism is about local communities having a local voice and deciding what they want in their area. I do not think any of us in this place would disagree that we want local communities to retain that strength of voice—that strength of community—that allows them to make decisions for themselves. That is what I believe conservatism should be about, and the hon. Lady is always welcome to join the Government side of the House if she subscribes to it in such a manner. As I was saying, we have to make sure that development plans are shaped locally, and that when neighbourhood plans come into contention with developers, those plans are able to be robust and rigorous.

I will make two more quick points before I sit down. Clause 83 of the Levelling-up and Regeneration Bill—I am probably making some of the arguments that I will make again tomorrow—deals with the question of development plans versus the national development plan. We are asking local communities to come up with development plans, but telling them that when they come into contention, the national development plan will override theirs.

I am deeply unhappy that the national development plan has not even been published. Tomorrow, we have the Second Reading of that important Bill—a Bill that will be watched by all our constituents—and we are faced with the fact that documentation has not been published. I have been reassured that a lot of this documentation will come forward when the Bill is in Committee, but I urge the Government to act with a little more urgency and to expedite the publication of this document, because my constituents view this as an enormous power grab. They are saying, “We will produce our local development plans, but if the Government do not like them or if a contention is raised at any point during the development of those plans, they can be overridden by a central body.” If I am wrong, the Minister will steer me in the right direction, but I ask for details on that specific point to be provided as soon as possible. The Secretary of State must not have the ability to override local plans, because that will kill people’s faith in the system. We need to have the opportunity to amend this in Committee, and not simply have a Cttee of Government-appointed members. I am happy to volunteer myself, although I am not entirely sure that the Government will be taking me up on that offer.

When introducing the planning Bill, the Secretary of State used the acronym BIDEN, meaning we would build beautifully, we would build with infrastructure in mind, we would hold developers to account, we would take the environment into account and we would have neighbourhood plans. Having travelled across my constituency, engaging with local groups, parish councils and those who have produced neighbourhood plans, I can assure Members that those people like that acronym. They want to see it written into the Bill; they want to be reassured that the Secretary of State’s words are not just words but text in the Bill that we will debate tomorrow, and that that Bill will reform a planning system that has been found wanting for the past 32 years. We have the opportunity to achieve that reform now, and the Secretary of State has the opportunity to prove that he is good not just at rhetoric, but at passing pieces of legislation.

The hon. Member for Strangford may well have misled the House in saying that his constituency is the most beautiful. I am sure we would all disagree and would make the same argument for our own constituencies.

[Ms Nusrat Ghani (in the Chair)]

Mr Mangnall, can we be careful when we suggest that colleagues may be misleading the House?

[Anthony Mangnall]

I retract that, of course. I have been to Strangford, and it is a very beautiful constituency; I am not sure it is the most beautiful, but Members would not expect me to say anything else. However, the hon. Gentleman was absolutely right that we need sensible planning.

If I may, I will conclude with a few points. First, when we debate the Bill tomorrow, we must ensure that its policy is “brownfield sites first”. There are 21,000 hectares of brownfield land across the United Kingdom, which could accommodate 1.3 million houses. Some 2,100 acres of that land are owned by publicly owned organisations, and we could accommodate 125,000 houses on it. That is perhaps something for us to think about. Secondly, we must ensure that infrastructure is there first, so that we are building with a local community—doctors, schools, roads, sewerage networks—in place before development even starts. Thirdly, developers must be held to account. Finally, and above all, we must make sure that we listen to our local communities.

[Ms Nusrat Ghani (in the Chair)]

From BIDEN, to BANANAs, to volunteering to sit on a Committee—the Minister is spoilt for choice.

15:19

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

As always, Ms Ghani, it is a pleasure to serve with you in the Chair. As others have said, this is not only an important debate but a timely one, given the recent introduction of the Levelling-up and Regeneration Bill and its Second Reading tomorrow. I start by congratulating the hon. Member for Bosworth (Dr Evans) on securing the debate, and I commend him on his considered opening remarks. I also thank the hon. Members for North Wiltshire (James Gray), for Totnes (Anthony Mangnall) and for Strangford (Jim Shannon) for their contributions.

In opening the debate, the hon. Member for Bosworth made a strong case for the importance of neighbourhood plans to his constituents in Leicestershire, the need for greater clarity around neighbourhood plans and the need for such plans to be accorded more weight in national planning policy. Opposition Members are very much in agreement with the thrust of his argument, although I take issue slightly with his wider remarks about unregulated development and development without the necessary infrastructure, which he spoke of as if they were materialising from the void, as if by magic, rather than as a consequence of successive Conservative Governments being determined to liberalise the planning system in a way that is causing extremely damaging development across large parts of the country. That issue aside, we have heard from all the speakers today about the benefits of neighbourhood planning.

Introduced in 2011 under the Localism Act as a formal part of the development framework, neighbourhood planning gives communities a greater say in where future development takes place, how it is designed and what infrastructure is provided with it. To the extent that it enables communities to better shape development in any given area, neighbourhood planning can—as we have heard, this is by no means always the case—increase public engagement, reduce the number of objections to planning applications and boost housing supply over and above local authority targets.

A detailed University of Reading report from May 2020 concluded that the contribution of neighbourhood plans to housing supply—as a result, essentially, of spatial planning by allocation—could be significant, that such plans have helped in many cases to improve design policy and refine local priorities, and that they have had an influential role in planning decisions in many parts of the country. There is also evidence that they have provided a means for particular communities to mitigate the impact of acute housing pressures in their localities. To take just one example—an issue that we have debated more than once in recent months—neighbourhood plans have proven to be a means of assisting coastal and rural communities to better control excessive rates of second-home ownership and the marked growth of holiday lets, although the Government still need to do much more to properly bear down on the problems arising from those trends.

In praising the concept of neighbourhood planning, I do not intend to imply that it is problem free. Opposition Members have genuine concerns about the take-up of neighbourhood plans, in the sense that all the evidence suggests that the vast majority of the 1,061 neighbourhood plans made to date emanate from more affluent parts of the country, where people have the time and resources to prepare and implement them, rather than from less affluent areas and more complex urban environments. We also have concerns about the fact that their policy content, in terms of addressing critical issues such as climate change, has been highly variable. Those concerns aside, we continue to support the principle of neighbourhood planning.

The more fundamental issue with neighbourhood plans—somewhat ironically, given the title of today’s debate on the Order Paper—is that, as things stand, it is not entirely clear what role they play in national planning policy.

[Anthony Mangnall]

Does the hon. Gentleman recognise that clause 88 of the Levelling-up and Regeneration Bill makes the point that neighbourhood plans will take into consideration climate change and environmental aspects?

[Matthew Pennycook]

I do recognise that and I will come to the Bill specifically later in my remarks. It does provide some useful clarity about neighbourhood plans, although there are far more serious defects when it comes to them, but I will come to that shortly.

As I was saying, I do not think it is clear, as things stand, what role neighbourhood plans play in national planning policy. They are explicitly addressed in the national planning policy framework, but only in terms of process and—as people will see if they read the relevant sections—in such a convoluted manner that I would not be surprised if even professional planners struggle with what the guidance means in practice. On one hand, the stated rationale of neighbourhood plans is that they give communities the power to develop a shared vision for their area, and because they are legally part of development plans, they do provide for a statutory say in what goes where. On the other hand, they must conform to local plan housing allocations and have regard to national planning policy and they can be overturned when they are in conflict with either. The resulting tension, the root of which is ultimately the question of who decides—communities or Ministers—remains largely unresolved.

What I would argue is lacking but is sorely needed is greater clarity about the precise remit of neighbourhood plans. More fundamentally, we need a better sense of the function of neighbourhood planning within the wider planning system. Ultimately, we will have to move toward a planning system based on a clear and easily understood settlement—one that ensures that communities that wish to proactively shape development in their area cannot stymie the meeting of local housing need, while also preventing central Government from unduly stipulating how that need is met on the ground in any given area. That balance is critical, and it is balance that is required, but we believe that that balance has still not properly been struck. That is largely because the default reaction of successive Conservative Governments when confronting the tension that exists between local planning and national planning has been to seek to disempower communities and further horde control at the centre.

Several hon. Members spoke about the great play that earlier Conservative-led Governments made of neighbourhood planning, and it is absolutely true that the coalition Government made great play of it and of localism more generally in their early years. However, since that Administration, successive Conservative Administrations have spent much of the past 10 years ineptly tinkering with the planning system in ways that have systematically undermined the scope for effective local and neighbourhood planning. Far from seeking to remedy that error or to take forward a localism agenda—as the hon. Member for Bosworth, who introduced the debate, argued—the Levelling-up and Regeneration Bill doubles down on it.

The hon. Gentleman did not explicitly mention this, although the hon. Member for Totnes did, but the new national development managing policies that the Bill provides for will take precedence over both local and neighbourhood plans where there is a conflict between them “to any extent”—the Bill is very clear about that. In addition, the requirements to consult on any new NDMP are entirely at the discretion of the Secretary of State and, unlike with national policy statements, there is no parliamentary approval process.

I just ask Members to consider for a moment what that would mean in practice if the Bill goes through unamended. Those powers would allow a Minister of whatever political allegiance to develop an NDMP encompassing literally any policy designated by them as relating to development or use of land in England, to determine not to consult on that policy and then to use it to overrule any local development plan in conflict with it at the stroke of a pen. Is it any wonder that organisations such as the Campaign to Protect Rural England are warning that if this power is enacted it will stifle local innovation on issues such as affordable housing, energy efficiency and nature conservation, undercut local democratic engagement in and scrutiny of the planning process, and lead to significant delays where conflict between local plans and national policies is contested?

The hon. Member for Totnes was absolutely right when he spoke about the Levelling-up and Regeneration Bill as an opportunity. We have an opportunity to reform planning policy in England in a way that empowers local communities. Instead, my fear is that the Bill as drafted is likely only to further erode the legitimacy of the planning system in the public’s eyes by downgrading the status and the scope of local planning. The Government must amend the Bill to ensure that communities are still able to participate effectively in every aspect of development plan formulation, and to make it crystal clear—I think this is the point that the hon. Gentleman was making earlier—that NDMPs can only be used to overrule local and neighbourhood plans in relation to nationally significant issues.

When the Minister responds, I hope we hear from him that he appreciates the concerns that have been expressed about the ways in which the Bill undermines localism in the planning system, and that he is willing to think again about those clauses in the Bill that would undermine local and neighbourhood plans specifically. More widely, I look forward to hearing his thoughts about how the Government might provide greater clarity about the future remit and function of neighbourhood plans and in particular—this point was well made earlier—about what can be done to encourage their uptake by communities, particularly those facing the greatest social, economic or environmental challenges?

15:28

[The Minister for Housing (Stuart Andrew)]

It is a pleasure to serve under your chairmanship today, Ms Ghani.

I congratulate my hon. Friend the Member for Bosworth (Dr Evans) on securing this very important debate, and I also congratulate all hon. Members who have taken part and given their own experiences, from their own constituencies, about the importance of neighbourhood planning. My hon. Friend has been and remains a tireless champion of both neighbourhood plans and neighbourhood planning in his contributions to debates and in much of his extensive correspondence with me as a Minister. He has been consistent in advocating for a more democratic and locally led planning system. Perhaps unlike other Westminster Hall debates, this might be one of those rare occasions on which the Minister responding on behalf of the Government agrees almost entirely with all hon. Members’ contributions. I certainly hope that my comments today will reassure him and other hon. Members that the Government are committed to putting communities at the very heart of our planning system, with neighbourhood plans playing a crucial role in that area.

Before I say more about how we are working to make that vision a reality, I should say to hon. Members that I am, of course, unable to comment on specific cases due to my quasi-judicial role in the planning system. However, I can talk in general terms about many of the issues that have been raised in today’s debate. At the outset, let me say that the Government believe that neighbourhood planning offers a powerful set of tools for local people to shape development in their area—development that meets their community’s needs, from protecting green spaces and local heritage right down to the design and characteristics of new homes.

As hon. Members will know, these plans continue to have real statutory weight in planning decisions. Once made, they form part of the development plan for the local area alongside the local plan, and they become the starting point for decisions on individual planning applications. In fact, the national planning policy framework makes it clear that where a planning application conflicts with an up-to-date neighbourhood plan, permission should not usually be granted. It is important to stress that the framework affords certain neighbourhood plans additional protections if the local planning authority cannot demonstrate a five-year land supply of deliverable housing sites—something that I know my hon. Friend has identified as a serious cause of concern for residents in his own constituency. These additional protections kick in where plans are under two years old, meet their identified housing requirement and other conditions are met.

Local planning authorities play an important role in this process too. They must provide advice and assistance to neighbourhood planning groups when producing their plans and take decisions at key stages. Planning legislation and policy also makes it clear that emerging neighbourhood plans can be afforded weight in decision making, particularly when they are at an advanced stage of preparation. I am delighted to say that many communities have taken up the opportunity to prepare a neighbourhood plan since the policy was first introduced. Over 2,800 groups have started the process since 2012, and over 1,300 plans are now in place across the country. As I understand it, there are no fewer than six in my hon. Friend’s constituency of Bosworth.

I would like to take this opportunity to express my admiration for the communities that have taken the time to prepare these neighbourhood plans, bringing local people together to shape development in a way that meets their needs. There are some brilliant examples of this work all over the country. The Bridport area plan in Dorset, for example, covers four parish councils and is located entirely in a designated area of outstanding natural beauty. The councils are working in partnership there to make sure that high-quality design goes into every affordable home that is built, so that they are indistinguishable from the available houses on the open market.

[Anthony Mangnall]

I apologise for interrupting the Minister. He is giving an excellent speech, including very robust answers to some of the issues we raised. The policy document that was introduced alongside the Bill talks about scrapping the five-year land supply for local authorities that have up-to-date local plans. Can the Minister confirm, either tomorrow or in future in Committee, that that will actually be within the legislation —in black and white in statute?

[Stuart Andrew]

My hon. Friend is right. One of the big issues I have seen in my own constituency, and during my time in this role, arises when councils do not have a local plan in place—and even if they do in some instances. If they do not have the five-year land supply, there is speculative development that happens all over the place, and it pits communities against any sort of housing development. We are making it very clear in the Bill—and supporting documents will be published alongside it—that where an area has an up-to-date local plan, there is no need for it to prove that it has a five-year land supply to stop that speculative development happening.

[James Gray]

I very much welcome that stipulation in the Bill. However, will the Minister consider one of the problems that I suspect may arise, namely that if we give notice to developers that that clause is coming into effect in a year’s time, or that the local plan might well take a few more months or a year to complete, in the meantime there might be a deluge of speculative developments that we cannot stop, until such time as the law has become an Act?

[Stuart Andrew]

My hon. Friend made that point in a conversation we had the other day. It is a valid point and one that I am taking back to the Department to double-check that we have all that in place, because it is important.

I mentioned the neighbourhood plan in Dorset, but closer to home in London, in Newham, is the Greater Carpenters neighbourhood plan. That post-war estate is seeking to develop and reoccupy existing empty homes. The policy emphasises affordability, prioritising low-cost family-sized homes and homes for older and disabled people. It is a textbook example of community-backed sustainable development. We want more areas to follow that lead, so we have put in place £40 million of funding up until 2023 to ensure that residents have the tools and resources that they need to get their plans in place.

In many ways, therefore, neighbourhood planning has been a great success story, but the Government and I want to encourage more communities to become involved and have a real say in what is built locally and where. That is why the Bill that has been mentioned on many occasions today includes the important role that neighbourhood plans will continue to play in the planning system. It makes it clear that communities will be able to continue allocating sites for housing, protecting green spaces and local assets, and setting design requirements for new developments through their plans. Crucially, the Bill will strengthen the role of neighbourhood plans in decision making. Planning application decisions will only be able to depart from plans if there are strong reasons to do so.

Neighbourhood planning is widespread, but—I take the point made by the hon. Member for Greenwich and Woolwich (Matthew Pennycook)—take-up is uneven across the country. In some areas, usually in towns and cities, there is little neighbourhood planning activity. We recognise that some communities have faced challenges in getting a neighbourhood plan in place, and we want to ensure that all areas can become involved.

Through the Bill, we will introduce neighbourhood priority statements—a new additional tool to provide a simpler, faster and more accessible way for communities to participate in neighbourhood planning and to shape development in their local areas. The statements can be prepared by neighbourhood planning groups and can be used to set out the community’s priorities and preferences for their local area, on everything from the new facilities that they need to the buildings and green spaces that they want to be protected. In fact, we anticipate that in some areas the statements might also act as a springboard for preparing a full neighbourhood plan, a design code or other community initiatives outside the planning system. Councils will be required to consider statements when they prepare their own local plans, meaning that neighbourhood priorities cannot be brushed aside easily; statements have to be treated as formal input. Taken together, we are confident that the reforms will further cement—forgive the pun—the role of neighbourhood planning in the system. Perhaps more importantly, that will provide communities with more opportunity to influence development right on their doorstep.

I will turn to a couple of the points made by Members. I want to make it clear that I am a huge fan of neighbourhood planning. I am fortunate enough to have a parish council and a town council—in Rawdon and Horsforth, respectively—as well as a group of volunteers in Aireborough, developing neighbourhood planning. I have seen at first hand the enormous amount of time that they put into developing the plans.

In the first few weeks of doing this role, I was keen to do a roundtable with neighbourhood planning groups around the country. It was useful to listen to their experiences. We have taken on board a lot of what they said and we are looking at how we can make further improvements. Among a number of the points made today, however, was the argument that where such planning is locally driven, we often see more houses built. I was particularly struck by a council official, I think from Herefordshire, saying that because the council had invested in and supported neighbourhood planning, it had ended up seeing more houses built than it could possibly have achieved as a council. I would like to see that happen elsewhere.

My hon. Friend the Member for Bosworth was right when he said that too often planning is something that people feel happens to them, and we have to change that. That is why, in the Bill, we want to make local plan making easier so that more people can engage and can do so digitally and not to have go through hundreds of PDFs and complicated documents. He is right that it is about building the right houses in the right places. That will get public support for house building and stop the problems that we have seen. He is right to have mentioned the BIDEN principles, which really do stand for many of the things that we want to see, and he was completely right to raise the issue of older people’s housing too. We will soon establish a taskforce to look into that so that we provide our older generation with a choice of housing—not just one type of housing—so that we can help them downsize if they want to. They will not be forced to.

[James Gray]

Does the Minister agree that there is one other area that needs to be looked at, particularly in the area of older people’s housing—namely, better use of the stock that we have? There are at this moment 800,000 empty houses in the United Kingdom. We must find a way of making better use of them. Many of those empty houses are old people’s houses that they have inherited or perhaps moved out of. It seems they do not know what to do with them. Can we find a way of writing into the Bill some means by which we can make better use of the existing stock?

[Stuart Andrew]

My hon. Friend is absolutely right. It is not just about building new homes, but making sure there is efficient use of the stock that we have, and there are measures in the Bill to try to encourage the use of empty homes.

The two-year validity of a plan was raised at the roundtable. Again, it is something that we are looking at. I have mentioned the issue of the five-year land supply. The issue of local housing need figures is also something that we are trying to resolve as quickly as possible.

I love the fact that the hon. Member for Strangford (Jim Shannon) comes to each of these debates to give a Northern Ireland perspective, which is particularly helpful on this matter. I remember a few people scratching their heads in a debate when I was talking about HS2. I thought, “If I can’t even get it to Leeds, how are we going to get it to Northern Ireland?”, but there we go. He was right to talk about areas of outstanding natural beauty and protections for them. Neighbourhood planning could be more imaginative about the sites that could be developed. I have seen that in my own community where people are really very clever. He was also right to talk about the provision of infrastructure. That is why the “I” in BIDEN is so important. The levy that we are introducing will capture more of the land value so that there is more money for the local community.

One thing that I have certainly picked up is that we need better engagement between local planning development and the provision of health services so that they all come at the same time. People are frustrated when they see the houses and years later, if ever, the infrastructure that is needed to support them comes down the line. My hon. Friend the Member for Totnes (Anthony Mangnall) was right to say that local people know best. The design standards that we are putting in the Bill will be a key feature for many local communities, and new developments will complement the local area.

On development management policy, I know that people are concerned, but it is not meant to override a local plan, which has supremacy because it is the local plan. However, there is an enormous amount of duplication in the development of local plans—for example, protections for the green belt, heritage sites and so on. Many local authorities are not confident that there is enough weight in the current system, so the policy is to try to stop that duplication and make sure we have protections in place. Again, I have listened to colleagues’ concerns and we are actively looking at many of the points that have been made.

[Anthony Mangnall]

I accept the Minister’s response, but the explanatory notes and the text of the Bill talk about what happens in the event of a conflict between a local plan and a national plan. What does he envisage the conflict will be in a scenario where it may override a domestic plan?

[Stuart Andrew]

It would not be possible to set land uses through national development policy. No housing will ever be built on sensitive sites if the local authority opposes it because of any of the NDM policies. I hope I can give my hon. Friend that reassurance, but I have heard his points and will come back to him.

I thank my hon. Friend the Member for Bosworth for securing today’s important debate, and I am grateful for the opportunity to reiterate the Government’s commitment to putting local communities in the driving seat of a simpler, smoother and more inclusive planning system. I should add that many of the measures we have set out in the Bill, such as neighbourhood priority statements, will be honed and refined as we put the legislation on the statute book. I speak not just for myself, but for all my ministerial colleagues, when I say that we are committed to working closely with hon. Members in all parts of the House to make sure we get these reforms right and delivered on the ground, and that they deliver the improvements we all want to see and help us to fulfil our pledge to level up communities right across the country.

[Ms Nusrat Ghani (in the Chair)]

It would be remiss of me not to mention how important this debate is to my constituents in Wealden as well.

15:46

[Dr Luke Evans]

I thank the staff for their attendance today, and the Chair for her wise intervention. This has been an interesting debate about planning, and I am hugely grateful to all the speakers. If my hon. Friend the Member for North Wiltshire (James Gray) is not a knight after his speech, he definitely should be; it was a huge bible of information, but I would particularly like to pick up on the issue of the five-year housing land supply, which the Minister addressed. His point was that the key thing is building out: once approval is given, it should be built out to make sure it is taken forward.

It was fantastic to hear about the experience of the hon. Member for Strangford, in Northern Ireland (Jim Shannon). I am not going to shame him by saying that I was born in 1983; I think he said 1985, so 26 years’ worth of experience means that I have a lot to learn. In his speech, he hit on the nub of what we are talking about today, which is better homes. That is a really important point to take away and deal with, and I will return to it in my closing remarks, because it brings together the issues of access, all the problems that we have, and the potential solutions for building better lives for people.

I do not think anyone has called my hon. Friend the Member for Totnes (Anthony Mangnall) a BANANA before, but maybe today will set a precedent. Given his hunger, his voice, and his tireless energy in bringing forward this debate, his constituents are very lucky to have him as their representative, and he emphasised something that is really important: support for those who want to be enabled to deal with planning. I am grateful to the shadow Minister, the hon. Member for Greenwich and Woolwich (Matthew Pennycook), for his comments, but he is right that take-up is not as high as it should be. Dealing with planning is complicated, difficult and daunting, so we should encourage and support people going through that process. I am pleased to hear the Minister say that that is exactly what he intends to do.

I very much welcome the Minister’s closing comments. When he said, “I agree with everything”, I was hoping that he would conclude at that point, but alas, we had a few more minutes to go. However, I am grateful that the Government are listening, and are keen on taking this issue forward proactively; after all, we are not talking about houses, but about homes. Homes are where we live, and we live in neighbourhoods. If we keep that in mind, we will not go far wrong.

Question put and agreed to.

Resolved,

That this House has considered the role of neighbourhood plans in national planning policy.

15:49

Sitting suspended.

Ports (Forth and Clyde)

Tuesday 7th June 2022 Westminster Hall

[Ms Nusrat Ghani in the Chair]

16:05

[Ms Nusrat Ghani (in the Chair)]

I will call Kenny MacAskill to move the motion and I will then call the Minister to respond. There will not be an opportunity for the Member in charge to wind up, as is the convention for 30-minute debates.

[Kenny MacAskill (East Lothian) (Alba)]

I beg to move,

That this House has considered regulation of ports and maximising economic and maritime potential on the Forth and the Clyde.

It is a pleasure to serve under your chairmanship, Ms Ghani. As post-Brexit chaos has all too vividly shown, ports are a vital part of a nation’s infrastructure. Scottish and UK exports have been hindered and harmed by Brexit itself, but also by blockage at key ports. Commercial harbours are fundamental for trade and the health of the economy. Indeed, the UK Government even sought to reopen a port as the crisis loomed and at significant cost—albeit failure. Meanwhile, Ireland has seen ferry and container services to the continent greatly increase, allowing for both outbound exports and inbound tourism. Scotland, though, remains devoid of even one direct ferry service to Europe. There have been past debates about that issue and the continued problem, so today I wish to focus my remarks on another aspect of maritime policy, one that equally constrains Scottish economic growth and the potential for Scottish tourism. It is related and inextricably linked, as ferries and ships ply their trade and take their goods to harbours. The issue is port ownership and regulation.

Ports were privatised in 1992, and that lies at the heart of the problem and remains a serious concern for Scotland today. Hence, although transport is largely devolved and much to do with ports and harbours rests within the domain of the Scottish Government, a debate in this Parliament remains hugely relevant and, indeed, vital. As well as being caused by the UK Government’s actions in privatisation, it also affects their current reserved powers, as it has created a monopoly situation, which I believe is harmful to local needs and to Scotland’s national interests. Trust in municipal ports still exists and they mostly perform well for their communities. I have many in my constituency and others, such as Aberdeen, can be even bigger. However, there are critical areas in Scotland where what should be municipal, indeed national, assets are instead owned and operated for private profit, and where the wants of other communities and even countries dominate.

Scotland has many estuaries, but industrialisation and population have ensured that the two most critical are the firths of Forth and Clyde. They teem with people and businesses, as well as being redolent of Scottish history. They are vital for access, not just to the east and west coasts of Britain but for trade beyond with Europe, America and the rest of the world. Who owns them and what effect does that have on our nation?

Let me start on the east coast. I was born in Leith, for long the principal port on the Forth, if not in Scotland, until trade moved west. Nowadays, I can see the river from my flat in Dunbar and therefore know the estuary well. Ask anyone in either of those communities or, indeed, anywhere on the banks on the river who owns Forth Ports and they will say perhaps the council or the Scottish Government or maybe even a wealthy Scottish industrialist. But no, they would be wrong and they would be gobsmacked to know that Forth Ports is owned by the Public Sector Pension Investment Board, a Canadian Crown corporation.

The fundamental duty of that organisation is to maximise revenue for the pensions of Canadian public sector workers, current or retired—a laudable aim that I do not criticise in the least, as they are no doubt pensions well earned through hard work and endeavour. However, the duty of the Canadian Public Sector Pension Investment Board is not to ensure the maximisation of the port asset for the local community, let alone ensure the growth of the Scottish economy. No wonder many residents in Leith and even some employees view it more as a property developer than as a port operator, or that Forth Ports sees the construction of a wharf allowing cruise liners to dock as being the responsibility of the Scottish Government, rather than its own, despite the name and ownership of the asset. That is how it is: it is not Canadian pensioners to blame but port policy, or the lack of it, in Scotland and the UK.

It gets worse. Not only is Forth Ports owned by the equivalent of an absentee landlord—Scotland knows how harmful they can be—it is worsened by other ports that Forth Ports plc owns and operates. Forth Ports becomes the equivalent of a branch factory and, once again, Scotland knows how harmful that position is.

Who is Forth Ports plc? For sure, it owns Grangemouth, which is Scotland’s principal container port, as well as the ports of Leith, Rosyth, Methil and Burntisland, the other major ports on the Forth. It also owns the port of Dundee on the Firth of Tay, the next firth or estuary up the coast. All fine and well, one might think, but it is what else it owns and operates, despite the name Forth Ports plc, which causes a conflict of interest. It also owns and operates the Port of Tilbury, which is part of the Port of London, situated on the River Thames, not the River Forth or any firth in Scotland.

We might ask, “So what?” But it is when we realise, not just where ownership lies, but where the major source of operation is sited that the problem appears. Tilbury carries more traffic than all the Scottish ports combined. Forth Ports corporate website last year indicated that 16 million tonnes of cargo went out of Tilbury, but only 9 million from Grangemouth, which is by far the largest Scottish port. Tilbury, as well as dominating in trade, dominates in passenger numbers. The cruise liner turnaround hub at Rosyth, mentioned on the corporate website, is dwarfed by the London international cruise terminal boasted of at Tilbury on the same corporate site.

In a nutshell, what does that mean? It means that what should be Scotland’s major east coast port area is owned for the benefit of pensioners across the Atlantic, and where the strategic focus of management is on the Thames not the Forth. The interests of the Forth in Scotland are swamped by those of a Canadian pension fund and a competitor estuary. That is the issue on Scotland’s east coast but what is it like on the west?

The west coast remains vital to Scotland, even if much focus has once again returned to the North sea and away from the Atlantic. It is rooted in the Scottish psyche and soul, from the tears of emigration, through ships that were built and sailed the world, to songs still loved and sung today. The Clyde remains Scotland’s largest urban concentration, still has a manufacturing base, provides world-class food and drink exports and possesses scenic sights that many round the world long to visit—the basis for a vibrant port, or even ports, one would think.

The major ports on the river Clyde—Glasgow, Greenock and Hunterston—as well as Ardrossan down the Ayrshire coast, are owned and operated by Clydeport, but since 2003, ownership of them has moved from the firth, as with the Forth. Ask a resident on the Clyde who owns the major harbours on the river, and a similar response of government, local or national, or a local worthy, will be forthcoming. But now the owners of the major harbours on the River Clyde are Peel Ports plc, part of Peel Properties, one of the largest property investment companies in the UK.

Peel Ports is based in Manchester and the majority shareholder is John Whittaker, a billionaire who lives on the Isle of Man. Again reflecting the situation on the east coast and the River Forth, the interests are not those of the local communities or even the nation’s economy. Instead, as well as owning other harbours, which I will come to shortly, it has an extensive property portfolio, including John Lennon airport in Liverpool and the Manchester Ship Canal. It also owns Cammell Laird shipyard and Tranmere oil terminal on the Mersey.

I have nothing against any of those operations and wish them well. I have no doubt they try to do the best for their workforce and customers, but their interests are not similar to the interests, and certainly not the needs, of the Clyde or Scotland. Moreover, the principal beneficiaries are not Clyde communities or the Scottish economy. Instead, it is for the benefit of a Manchester-based company and an Isle of Man billionaire.

Once again, as with the Forth, the situation of ownership is worsened by the operation of the ports by what in many instances should be competitor harbours. So much for the free market extolling and liberating competition. Peel Ports plc also owns the Mersey Docks and Harbour Company, which in turn operates the port of Liverpool. Indeed, it also owns Heysham, Great Yarmouth and London Medway, and described the last as its “flagship port”.

It is not just in praise from the principal owners where the Clyde loses out in trade. In terms of tonnage of trade, according to Department for Transport data for 2020, the Mersey dominates with 31 million tonnes in and out; Medway has 9 million tonnes, leaving the Clyde trailing in their wake at under 7 million tonnes. As with the Forth, ownership and operation of the Clyde have neither the local community nor the national interest at their heart or as their focus.

There are additional issues in the Clyde that worsen those conflicts of interest. While they could also arise on the Forth given the circumstances, they are certainly live on the Clyde. First, as a consequence of harbour ownership, Peel Ports is in charge of Inchgreen dock in Greenock. That dock is potentially critical to reviving shipbuilding on the Clyde and to securing the future of the last remaining yard on the lower Clyde, Ferguson Marine in Port Glasgow. There are other issues there with ownership and construction of ferries that I do not have time to go into: the wrong ferries ordered, incompetence by the procurement agency CMAL and rush and failure by the Scottish Government.

What remains clear is that Scottish island communities have a desperate need for new vessels, and Ferguson Marine is the yard to build them. When work is required and an industrial future sought, it is there, not Turkey, where orders should go. Moreover, the workforce has not just the history but the current skills to build them. In doing so, and given the needs of island communities, future expansion may well be needed. That is where Inchgreen dock comes in. Rather than ensuring it can be used for shipyard expansion, Peel Ports has sought to lease it as a breakers yard. The skilled jobs are fewer and the work less profitable.

In any event, the breakers yard has not opened yet. Would that have anything to do with Peel Ports plc also owning Cammell Laird shipyard on the Mersey, which competes with Ferguson for orders? It is not just Turkish ports competing for orders; Cammell Laird also wants orders that should be going to Ferguson Marine on the Clyde. It certainly does not look right. Where is the free market competition so extolled by this Government when the interests of a Clyde shipyard, as well as those of Clyde communities and the Scottish economy, are drowned by those of the Mersey?

Dredging is an additional issue following privatisation. Clydeport, as with Forth Ports, has become the statutory harbour authority, and is therefore responsible for dredging in the river. But on the Clyde there has been no recent dredging upstream beyond the BAE Systems site. Govan docks has recently been taken over, and the new owners have ambitious plans. How can they ensure that dredging takes place when it is carried out by a rival port owner, and one who may have no interest whatever in its success?

Ports are critical to our communities and our economy. Key harbours and estuaries are vital for trade, tourism and employment. Yet in Scotland, the two major firths have owners whose interests are not those of the local communities or, indeed, the nation, and whose operations actually conflict with the needs and wants of the Forth and the Clyde. There is no way that Canada would allow the port of Montreal to be owned by New York or that the USA would allow Los Angeles to be run by Vancouver. Neither Belfast nor Dublin would benefit by being run by the other. It is, perhaps, unsurprising that the island of Ireland’s two major ports are thriving—they are municipally or nationally owned and focus on their own national interests, not those of someone else.

This unhealthy monopoly is damaging Scottish interests. It should be broken up, with the Government seeking action from the Competition and Markets Authority to ensure Scotland’s interests are both protected and promoted. If not, compulsory purchase or the creation of new ports should be pursued by the Scottish Government. The Forth and the Clyde cannot be drowned by the interests of the Thames and the Mersey.

16:20

[The Parliamentary Under-Secretary of State for Scotland (Iain Stewart)]

It is a pleasure to serve under your chairmanship for, I believe, the first time, Ms Ghani—a very great honour. I congratulate the hon. Member for East Lothian (Kenny MacAskill) on securing the debate, although I take issue with the rather gloomy picture he paints of ports and the wider maritime sector in Scotland. I shall address why I take a different view in a moment.

Ports are the heartbeat of our global goods exports. We expect that global maritime trade volumes could treble by 2050 and we will be ready to play our part, including by reforming our ports regulations to ensure we support our ports to continue to grow and excel in a competitive global environment. The economic opportunities in the maritime sector are huge, including driving up exports and creating high-paying jobs across the country, with specific benefit to coastal communities.

The goal is for the UK to cement its already strong position and thrive as a world-leading maritime nation at the cutting edge of technology, innovation and maritime services, underpinned by effective, responsive and best-in-class regulation. Our policies on levelling up, building back better and our transition to net zero are crucial to gain the economic benefits for our ports and increase the prosperity of our country. Those policies provide successful examples of the engagement between the Government and the private sector. It is encouraging to see how successful Scottish businesses, ports and academic institutions have been in the recent clean maritime demonstration competition—a clear signal of Scotland’s drive and ambition to innovate.

I do not accept the hon. Gentleman’s assertion that there is somehow a conflict of interest in the owners of Forth and Clyde ports also owning other ports in the UK. One thing we are keen to see is the extension of—a very difficult phrase to say—short sea shipping. Do not say that in a hurry.

[Ms Nusrat Ghani (in the Chair)]

I would say to the Minister that, as the previous maritime Minister, all those words used to flow quite easily for me. He may continue.

[Iain Stewart]

I am very grateful for your sage advice, Ms Ghani. The transportation of goods around the UK shoreline will be an increasingly important part of transport connectivity in this country.

I would also point to the investments that are being made to increase our port capacity. The hon. Member for East Lothian may be aware that, as part of the Glasgow city deal programme, considerable investment will go into Greenock to upgrade the ocean liner facilities and make sure that the port remains a key destination for international and domestic cruises.

The hon. Gentleman touched on shipbuilding in Scotland, which is renowned for its rich shipbuilding heritage, spanning centuries. It remains the location of a significant proportion of the UK’s shipbuilding capacity. The refreshed national shipbuilding strategy, published in March, was an important milestone for the industry. Scotland will benefit from the Government’s shipbuilding spend—£4 billion across the UK over the next three years—and the renewed focus on this industry. The shipbuilding pipeline in the strategy provides industry with certainty and a clear setting out of the Government’s policy and procurement ambitions. Looking at the Royal Navy alone, in the short term for Scotland, the shipbuilding pipeline sees eight Type 26 frigates being built by BAE Systems on the Clyde, sustaining some 1,700 jobs, and five Type 31 frigates being built at Rosyth by Babcock, supporting around 1,250 jobs. There are of course many other opportunities for Scottish shipyards and suppliers, and this clarity on the Government’s future requirements should provide confidence for industry’s order books. It should also create enough volume to encourage industry to invest in facilities, infrastructure and innovation, which will bring ever-increasing rewards.

The refresh is wider than defence; it is about systems and subsystems, ports, offshore wind and more. By broadening the scope of the strategy, more companies across Scotland will benefit. The focus on improving skills should be welcomed, as this is an area where we all recognise the importance of getting it right. We fully support the ongoing engagement between Whitehall and the devolved Administrations on how to make a meaningful difference in the area, which will ensure that the initiatives already under way, including with local universities and apprenticeships, can thrive.

Alongside the refresh, the Maritime Capability Campaign Office, which unites the defence export and civil maritime capabilities in one unit, will help to build on Scotland’s export success in military ships and designs. It will champion exports and investments, unlocking opportunities for our world-class shipbuilding industry to export its innovative technologies, services and designs around the globe. The export variant classes of the Type 26 and Type 31 have already been successfully marketed and sold overseas, including to Australia, Canada, Indonesia and Poland.

The hon. Member for East Lothian tempted me to go down the path of commenting on the Ferguson Marine shipyard. I will resist the temptation to make political points, but it is one area where we might agree on the analysis of the situation.

Let me turn specifically to port regulation. The Government are currently consulting on the repeal of the EU port services regulation and associated statutory instruments. This retained law was designed and implemented with EU public sector ports in mind. It is the Government’s view that the provisions in the PSR are sufficiently covered in the UK by commercial practice within the framework of domestic law. Now that we have left the EU, we have the opportunity to review the regulation and to consider what is appropriate for the highly competitive UK ports sector, and I look forward to seeing the outcomes of that consultation this summer.

One area of UK-wide policy that I have not touched on yet, and which will be of enormous benefit in Scotland, is freeports. We are delighted to see the expansion of the freeport programme across the UK. In Scotland, we have seen the landmark agreement between the two Governments on the establishment of two green freeports, with up to £52 million of funding from the UK Government. I cannot go into any specifics at the moment, as there is a competitive process under way, but I am confident that the expansion of the UK freeport scheme in Scotland will bring great benefits, including regeneration of communities, the creation of high-quality jobs and support in the transition to a net zero economy.

In closing, I would like to reflect on the importance of ports to the heritage, economy and people of Scotland. From our historic industrial past to the thriving sector of today, ports have a leading role in the defence of the nation by developing world-class technology and innovation, and providing high-quality jobs. Now we look to the promise of tomorrow and the opportunities to be realised for our workers, for exports, for our communities and for our green future. I think we can all agree that our ports have been, and will continue to be, essential to the fabric of the nation and the success of the economy. The Government want to ensure that we maximise our capabilities across the sector through effective regulation, innovative practices and a focus on spreading economic benefits to all corners of the United Kingdom.

Question put and agreed to.

16:29

Sitting suspended.

Football Index Collapse

Tuesday 7th June 2022 Westminster Hall

16:34

[Liz Twist (Blaydon) (Lab)]

I beg to move,

That this House has considered the impact of the collapse of Football Index.

It is a pleasure to serve under you as Chair, Ms Ghani.

Football Index was a platform that allowed customers to create, buy and sell bets to one another as a means of making money, but it was, or was presented as, so much more than just betting. The “go to market” option on the platform allowed users to buy and trade with one another, creating an exchange market for customers. Due to the nature of the product, from its launch in 2015 it was advertised to customers repeatedly by Football Index as

“the world’s first football stock market”,

leading many to believe that this was more than just simple gambling and that it was a way of using their knowledge of football to grow a portfolio and make money. And on paper, in the early years, some did.

The collapse of Football Index has really damaged many customers. We have only to look at the tip of this iceberg to see stories from individuals who have lost so much as a result of the failings surrounding the company. The issue is more than money, vital though that is. The situation has also had an impact on many customers’ mental health and wellbeing. Despite the report published by Malcolm Sheehan QC in September 2021, there are still many unanswered questions, leaving the thousands of people affected without answers. This must be addressed to ensure that they have the answers they need. We must also, crucially, look again at the regulatory failing that allowed the situation to come about.

[Sir Greg Knight (East Yorkshire) (Con)]

I congratulate the hon. Lady on securing the debate. Is she aware that in the previous Session of Parliament there was an early-day motion on this subject? It was tabled on 25 November by the right hon. Member for Knowsley (Sir George Howarth), who I see is in his place, and it called on the Government to implement the recommendations of Malcolm Sheehan QC, but it concludes by saying that it

“further calls on the Government to do all that it can to ensure that those owed money receive full reimbursement.”

Does the hon. Lady join me in supporting and repeating that request today?

[Liz Twist]

I thank the right hon. Member for his intervention. Certainly this debate is part of the ongoing campaign to ensure that justice is done, and I will touch on the issue of compensation and redress later in my speech.

[Sarah Owen (Luton North) (Lab)]

I thank my hon. Friend for giving way on the point about fairness and justice. My constituent, Mr Murphy, lost £7,000 following the collapse of Football Index. Unbelievably, all that he has had back so far is £81, but for him and constituents like him, it is not about the money; it is justice that they want and deserve. He wanted me to say that he said this:

“I want the Directors responsible to be made accountable for their actions…I have seen nothing from the Government in terms of redress for customers or even how something like this can be prevented in the future.”

Does my hon. Friend agree that the Minister needs to tell us how this will be prevented from happening again, and what justice people can expect?

[Liz Twist]

I certainly agree and will touch immediately on the issue of redress. As I was saying, the issues identified must be addressed to ensure that those affected have the answers they need and we must look again at the regulatory failing that allowed this situation to come about. Tens of thousands of customers had—and lost—more than £124 million in the system at the point of its collapse. Of course the question of redress must be revisited, as hon. Members have already said, because the clear failings of the regulations applied to BetIndex Ltd, a subsidiary of Fame Ventures Ltd, have left many people in a difficult position.

The Sheehan report, as we have heard, highlights a range of issues about the regulation of the product; it highlights several failings by both the Gambling Commission and the Financial Conduct Authority. It sets out that from early in the life of Football Index, the product was not regulated correctly and the platform’s “go to market” function was not notified to the Gambling Commission. However, it states that the Gambling Commission had reviewed the product twice and this was not noted in the reviews carried out, meaning that Football Index was given its licence and launched without any consideration of one of its two main features. At that point, it was already clear that the Gambling Commission should have done more to protect the rights of customers. Given Football Index’s likeness to an exchange or a market, the Gambling Commission should have notified the Financial Conduct Authority.

The Sheehan report also states that the Gambling Commission became “fully aware” of the issues with Football Index in 2019, but it still allowed customers to put money into the platform, meaning that customers lost even more money because of the commission’s inaction.

In 2019 the Gambling Commission referred Football Index to the Financial Conduct Authority, and in September that year stated that Football Index should be authorised by both the FCA and the GC. Despite that, again nothing was put in place. Clearly, the failings allowed customers to bet more and more into a platform that was not correctly regulated. Now, in the aftermath, people are having to deal with the fear that they may never get back the money that they put into the platform. The life-changing impact that could have on some individuals is clear.

[Clive Lewis (Norwich South) (Lab)]

rose—

[Bell Ribeiro-Addy (Streatham) (Lab)]

rose—

[Liz Twist]

I give way to my hon. Friend the Member for Streatham (Bell Ribeiro-Addy).

[Bell Ribeiro-Addy]

I thank my hon. Friend for giving way and for making such a brilliant speech on an issue that has affected so many of our constituents. At the end of last year, I met my constituents who are victims of the Football Index collapse, and they shared with me details about the impact that the collapse has had on them financially. However, what they spoke about in most detail was the emotional impact and the damage to their mental health. Some felt ashamed or guilty for getting family members to invest and lose money in Football Index as well. Securing redress for the victims of the Football Index collapse is about more than just financial redress; it is also about giving them justice, given the emotional and psychological damage that the whole incident has caused. Does my hon. Friend agree?

[Liz Twist]

I most certainly agree. I know the real impact that the collapse has had on my constituents’ wellbeing—not just financially. My hon. Friend makes a valid point.

[Clive Lewis]

Will my hon. Friend give way?

[Liz Twist]

I will take one more intervention and then I must make progress.

[Clive Lewis]

I thank my hon. Friend for giving way, and for making such a powerful speech and securing this debate.

I wanted to intervene at this point, when my hon. Friend is talking about the regulatory framework, because it has comprehensively failed my constituents, many of whom have been suicidal. The collapse has led to them losing their homes or their businesses. The FCA failed them, Football Index failed them and the Gambling Commission failed them.

The Government have ruled out financial redress. Would my hon. Friend say that, in the interests of justice —indeed, if justice is to be done—and in the interests of our constituents’ wellbeing, the Government must look at financial redress again?

[Liz Twist]

I most certainly agree. It is one of the asks that I will make of the Minister later. I will try to speed up, because I am aware that so many Members want to speak.

I have made the point about the regulators and the fact that, in effect, Football Index was allowed to operate as a stock market where people traded stocks. I will now talk about the experience of people such as Chris and Collin, who are my constituents. They have given me permission to share their experiences. They told me about the difficulties the collapse has caused in their lives. Chris was saving up for a wedding and now has limitations on what he can afford. He said that Football Index

“was advertised as a great way to invest and buy shares, it was shown to be a better way to save compared to the rates banks offer. The loss of the £13,000 has limited certain aspects of what we can afford now.”

Collin also lost an incredible amount of money through this regulatory failing, which has had a direct impact on his mental health. As a result, he spent months unable to work, because of the stress and depression caused by the collapse. He told me:

“I feel a massive sense of guilt and anger that a huge amount of my family savings has been stolen. That money could have been used for my children’s future, house improvements, holidays and other investments.”

That comment again touches on the issue of regulatory failing. Football Index was able to sell itself as the “football stock market”; the language used was very public and the company even sponsored football teams high up in the Football League system. Allowing customers to believe that was incredibly misleading. The Gambling Commission and the Financial Conduct Authority should have stepped in long before they did. Their failure to understand a licensed product led to Collin, Chris and many other people across the country losing thousands of pounds.

On 17 May, I wrote to the Minister about the experiences of my constituents, and fortuitously, I received a response to my letter yesterday by email. The Minister noted that the Gambling Commission and the FCA have acted on the recommendations of the Sheehan report, so there is clearly a recognition that there was a failure in the regulation of the product. It is clear that the regulators have failed many people, like Chris and Collin, and they and I believe that they should be compensated in some way for that failure. The Sheehan report itself admits that it was

“produced under significant time constraints”

and could not provide

“as full responses…as possible”

to the issues, yet even from that condensed outline of the issues, it is clear that the regulatory failings have cost thousands of people dearly.

I welcome the gambling White Paper announced by the Government, which will seek to better regulate the market, better protect customers, and learn the lessons of this failure. However, that is simply not enough for the tens of thousands affected by the collapse of Football Index—those who have lost such great amounts of money, who are worried about telling loved ones about lost savings and growing ever more pessimistic about the Government’s handling of the matter. Those people simply want one thing: justice. On a number of occasions, the Government have stepped in when regulators and companies have failed to ensure that people are protected, so my constituents and those of other hon. Members ask, “How is this situation different?”

The Football Index action group has repeatedly asked the Government to do more to seek redress for those affected, and is willing to discuss that request with the Government and work with them to find a solution that will work for the people affected. As such, my first ask is whether the Minister will commit today to a meeting with the Football Index action group and myself to further discuss these outstanding issues.

It is clear that the failings that surrounded Football Index were severe, and the impact they have had on people’s lives will be lifelong. For that reason, those affected deserve the answers they need to move on from the situation. Will the Minister commit to another, more in-depth report, or would he be supportive of an inquiry into those regulatory failings to show that the Government and Parliament support those affected, and want to work with them to find the crucial answers that those people need?

Since the collapse of Football Index in March 2021, the regulatory failings have become clear, and the tens of thousands of people affected have lost huge amounts of money to this scandal. For them, we need to do more than learn the lessons and look forward; we need to find answers, and compensate where possible. My final ask is that the Government look again at bringing forward a redress scheme for the victims of Football Index. My constituents Collin and Chris, who have been hit hard by their losses as a result of regulatory failings, and all the other people affected across the UK, deserve answers and redress.

[Ms Nusrat Ghani (in the Chair)]

Due to the huge interest in the debate, the Minister’s time will be reduced to five minutes; the Opposition spokespersons’ time will be reduced to three minutes; and Back Benchers will have two minutes. My apologies, but that is the only way I can get you all in.

16:48

[Aaron Bell (Newcastle-under-Lyme) (Con)]

It is a pleasure to serve under your chairmanship, Ms Ghani, however brutal the time limit may be. I congratulate the hon. Member for Blaydon (Liz Twist) on securing this important debate and setting out the case so clearly—I will not do so again, given the time limits. I draw the attention of the House to my entry in the Register of Members’ Financial Interests, and let people know that I worked for Bet365 for 15 years before I came to this place. I have long experience of the Gambling Commission, and while I was in that role, it was frequently behind the curve and asleep at the wheel, which is one of the accusations levied at them regarding Football Index. In a period during which the gambling landscape was incredibly innovative, too many firms went bust with ante-post liabilities, too many punters lost money, and there was too little redress for people. Sadly, that is again the case today.

[Ms Nusrat Ghani (in the Chair)]

Order. Mr Bell, because some people have left the room, we have now increased the time limit to three minutes for you.

[Aaron Bell]

That is incredibly kind, Ms Ghani. Thank you very much.

This is a particularly egregious case. Five constituents have written to me about it; I will not name them, because I do not have their permission to do so, but a number of them have lost thousands of pounds. In this case, the Gambling Commission failed to identify the key features of the product, which then changed while Football Index was running it, and the Gambling Commission did not seem to notice. Andrew Rhodes, who I believe is a good man—I will come to that in a bit—said in his response that the Gambling Commission does not believe it licensed a Ponzi scheme. That may not be the case, but he also said,

“BetIndex was not recruiting enough customers to compensate for depleting its financial position”—

as it did by increasing the dividends—

“and ultimately collapsed as a result.”

If such a company is not recruiting enough customers to pay out the ones it already has, that looks like a Ponzi scheme to me.

It is clear that the ultimate blame lies with the operator. We have already heard a call for the directors be held to account, which I absolutely support, but we must be better at protecting people, as a Government and as a state. As I said, I have five constituents involved. I support what the hon. Member for Luton North (Sarah Owen) said about people wanting restitution and justice as well as compensation.

I am also very concerned that these people are vulnerable in other ways now. Football Index is finished, but there are other online products out there that, in my opinion, share some of the same characteristics. They are attractive to young men, in particular, because they look like get-rich-quick schemes. I am thinking of the crypto space and the various coins that are designed to be pumped and dumped. If people get in at the right moment they can make a profit, but if they get in too late they might lose their life savings.

Similarly, there is this ridiculous craze for non-fungible tokens, which, to their eternal shame, many football clubs and sports stars have endorsed. This is completely deplorable. I do not think those are regulated at all. Perhaps we can do something about that through the Online Safety Bill. I know that the Gambling Minister is busy with the Online Safety Bill Committee today, and I welcome his substitute, the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Mid Worcestershire (Nigel Huddleston), who used to be my Whip.

This situation mostly affects young men. I believe we owe them a duty of care. My five constituents—all young men—believed, because they saw the kitemark, that the Gambling Commission understood, and almost endorsed, the product. Obviously it did not. If we license these sorts of products, then we ought to be standing behind them. We are not standing behind them now, as they are struggling to get any sort of compensation at all, although there is obviously an administration process going on.

I am sure that everyone here will have constituents who have suffered as mine have. We owe it to them to get to the bottom of this and give them some restitution. I will yield my final 20 seconds.

[Ms Nusrat Ghani (in the Chair)]

Beautifully done, Mr Bell.

16:51

[Jessica Morden (Newport East) (Lab)]

I congratulate my hon. Friend the Member for Blaydon (Liz Twist) on securing a debate on a scandal that has caused much hardship. Constituents in Newport East have been among those who lost life-altering sums of money when Football Index collapsed last year. Some £124 million-worth of bets that were placed by customers in full trust with a company that was licensed by a UK regulator have all but disappeared. The scale of this loss is nothing like the sector has seen before. Hon. Members were right to say that individuals have been driven to the brink of suicide, marriages have collapsed, families have been affected, and life savings for weddings, houses and retirements have vanished. Over a year on, they are still dealing with scars on their mental health and finances, which has been reflected to me by constituents.

My hon. Friend the Member for Blaydon was right to stress that Football Index was not an ordinary gambling firm. It modelled itself as an investment package, and in an utter failure of regulation by the Financial Conduct Authority and the Gambling Commission, customers felt wrongly assured that their long-term investments in the index were secure. The Gambling Commission was aware that these investments were more risky than customers thought. The Sheehan review said that it was an “exceptionally dangerous pyramid scheme”. One constituent pointed out that Football Index took in a significant amount of capital at the beginning of the pandemic, and that its aggressive use of capital and failure to maintain a liability reserve to meet those investment obligations led to the rapid deterioration of the business.

The distinctive nature of Football Index also meant there was confusion, as has been mentioned, as to whether it was a gambling product under the remit of the Gambling Commission or a financial product under the FCA. The fact that there were unresolved discussions between the two authorities about co-regulating Football Index shows that there are still gaps in the framework, which seemingly enticing new business models can fall through. The Government need to iron this out.

There are serious questions for the FCA to answer. It twice stated that the product fell within its regulation, yet seemingly changed its mind. The Government should now look at the feasibility of a compensation scheme for the victims, using the precedent set by the collapse of London Capital & Finance, as well as securing proper redress for those who have lost so much. The Secretary of State should also ensure that the alarming regulatory failings that allowed this to happen are never repeated.

16:54

[Sarah Green (Chesham and Amersham) (LD)]

It is a pleasure to serve under your chairmanship, Ms Ghani. I congratulate the hon. Member for Blaydon (Liz Twist) on securing this debate on such an important issue. It is one that has caused a great deal of suffering.

The story of Football Index is one of regulatory deficiency, misunderstanding and failure by Government bodies to work together in the best interests of consumers. The Gambling Commission’s chief executive officer, Andrew Rhodes, said himself, in his September 2021 response to the inquiry into BetIndex:

“The lines between what is gambling and other types of products, such as financial services or computer games, has become increasingly blurred and no longer neatly fit into existing statutory definitions of gambling.”

Put simply, the lines were blurred and consumers trusted the product because it was licensed by a UK regulator.

However, the key issue is that the Gambling Commission did not have a firm grip of what it was licensing. Football Index managed to slip through the cracks between the Gambling Commission, the FCA, the Advertising Standards Authority and other bodies. The nature of the product meant that nobody was really sure who was responsible for regulating it, so nobody took full responsibility. While the Gambling Commission and the FCA sat on their hands, deciding how to deal with this new and unfamiliar product, vulnerable consumers were falling victim to Football Index’s misleading product and losing life-changing sums in the process.

One constituent told me they had lost £13,000—a sum totalling the majority of their life savings. Another has lost £50,000—a loss made even more sickening by the fact that their interactions with Football Index did not start until June 2020, long after the deficiencies had been exposed. I am sure that I do not need to explain the impact that losses of that magnitude have had on their mental health.

I know that the gambling White Paper is due to be published, and I hope that the proposals will strengthen consumer protections, the lack of which has cost Football Index customers millions. We must ensure that action to protect consumers from such schemes can be taken earlier, so that people do not continue gambling on a product that should not have been licensed. We need reassurance that the deficiency in regulation that allowed Football Index to slip through the cracks is remedied.

Finally, I agree with those who have said that we must ensure that customers receive compensation. Government regulation and licensing failed these consumers; the Government should do all they can to ensure that those owed money receive full reimbursement.

16:57

[Justin Madders (Ellesmere Port and Neston) (Lab)]

It is a pleasure to see you in the Chair, Ms Ghani. I congratulate my hon. Friend the Member for Blaydon (Liz Twist) on securing today’s debate. As we can see, it has been very well attended.

This issue has been described as the biggest scandal in British gambling history, with thousands of customers facing cumulative losses of up to £124 million. However, I think that describing it purely as a gambling scandal does not really show any empathy or understanding about the magnitude. Comments such as those attributed to the Gambling Commission—that people should not gamble more than they can afford to lose—fail to acknowledge this was not like putting a tenner on the 2.20 at Chepstow. Football Index promoted itself as an investment, with “guaranteed yields” in a highly regulated environment, and no bets have actually been lost, of course; the money was effectively stolen.

I have a constituent who has lost a six-figure sum, and some people’s losses are into seven figures. Individuals have been driven to the brink of suicide, marriages have collapsed, families have been torn apart, and life savings for weddings, house deposits or retirements have all vanished. This was not about people chasing their losses; it was money that was supposed to have been invested and was then wrongfully taken. While there has been a Government review—and, of course, promises to do better next time—there has not been justice.

Football Index has been described as a Ponzi scheme, and we now know that its executives were warned soon after its launch, as early as 2016, that its so-called stock market would prove to be unsustainable. Proposals to make the index more stable were actually rejected because of concerns about the possible impact on revenue. That all occurred some five years before Football Index’s eventual collapse, leaving serious questions about the effectiveness of its regulation.

According to newspaper reports, the Gambling Commission was warned in January 2020 that Football Index was

“an exceptionally dangerous pyramid scheme under the guise of a football stock market”.

Has the Minister spoken to the Gambling Commission about this? What did it say? What conclusions has the Minister drawn following this?

[Aaron Bell]

I am grateful to the hon. Gentleman for giving way because it allows me to make a point that I should have made in my speech. I believe that the new CEO of the Gambling Commission, Andrew Rhodes, understands the problems that occurred in the past. I met him in February to discuss this case and my overall experience with the sector. I think he accepts that mistakes were made repeatedly under the previous leadership of the Gambling Commission. I wanted to put that on the record and I thank the hon. Gentleman for giving me the opportunity to do so.

[Justin Madders]

I am sure that we will all note that improvement in regulation. It has been a failure; that is implicit from what has been said. It reminds me a bit of the leasehold scandal. People expected products to be sold in a safe way—these were similar, life-changing sums of money—and they have been found not to be secure.

We need some concrete assurances that the blurred lines, as we have heard, are not going to cause problems in the future and that there is going to be a clear delineation of responsibility for regulation in the future. We know from what a former employee said that senior management were warned back in 2016 that there was a problem, but the company continued to take money from people in that way for another four years. I want to know what has happened to those people in charge of the company. What sanctions have been issued against them? Are they fit to be involved in any businesses at all? That is a serious question that needs answering.

In conclusion, as we have heard, the lines between what is gambling and what are financial services are increasingly blurred. Nothing fits into a neat statutory category anymore. What is clear, however, is that there need to be proper protections and regulations for our constituents so that something like this never happens again.

17:01

[Alison Thewliss (Glasgow Central) (SNP)]

I am glad to have the opportunity to speak in this debate on behalf of a number of constituents who were affected by the Football Index scandal—in particular, two gentlemen called Marc and Andrew. Both invested significant sums of money in products that they believed were safe because they were regulated. Marc has made it clear to me that he is not a gambler and has never so much as put on a bet. He got involved with this because he was reassured that it was a regulated product. He thought it was safe and looked into it before putting any money in. He put his money in gradually and did not put it all in in one big lump sum because he was reassured by the regulation that existed. It was sold very much as an investment opportunity based on football knowledge. Given the sums of money that have been lost here—we are talking life savings; tens of thousands of pounds—it really does feel quite woeful that the Government are not stepping in to provide some form of redress.

It is clear that the company was still trading and attracting new customers even when concerns had been raised, to the detriment of many people who invested in good faith during that period. It was batted back and forth between the Gambling Commission and the FCA and, in a clear case of regulatory failure, neither was willing to take full responsibility for a product that should not have been licensed if nobody quite understood what it was for. The Government need to explain why those who lost out as part of the London Capital & Finance scandal have been entitled to a compensation scheme, but not those who have been affected by Football Index. For many, the sums of money involved are much the same, as are the failures of regulation.

I spoke to Marc on the phone last week and he has been left absolutely devastated by this. He and his wife separated for a while. He is still suffering from depression and anxiety, and he is on medication as a result. He feels very let down by the regulators, who should have kept him and all the others in this scheme safe. There is a big gap here. The Government may well say that they will learn from this, they will go forward and it will not happen again, but that is simply not good enough for my constituents. They should not be collateral damage in a regulatory failure. They deserve recompense, because the regulators who ought to have protected them failed in their duty to do so.

17:03

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

It is a pleasure to serve with you in the Chair, Ms Ghani. I also want to thank my hon. Friend the Member for Blaydon (Liz Twist) for bringing this debate and to acknowledge the excellent contributions we have heard so far.

The £124 million spent on the Football Index scandal was not lost—it did not disappear down the sofa and it did not fall out of a purse. It was taken in a business model that was rightly described by the hon. Member for Newcastle-under-Lyme (Aaron Bell) as a Ponzi scheme. A scheme that was allowed to happen because the Gambling Commission and the FCA failed in their duty to regulate gambling firms and protect consumers, and the Department for Digital, Culture, Media and Sport did not act when warned.

The Gambling Commission was told on many occasions, and certainly by somebody who knew the business back in January 2020, that the Football Index was deliberately imitating an investment product and that it was leading to users

“believing that they were investing rather than gambling”.

People were conned to bet—sometimes tens of thousands of pounds, and even six-figure sums, as colleagues have already mentioned.

[Sir George Howarth (Knowsley) (Lab)]

The recurring theme throughout this debate has been the regulatory failure that my hon. Friend refers to. Does she agree that in such circumstances the Government are the only organisation that can put it right?

[Ruth Cadbury]

My right hon. Friend is absolutely right, and I will come to that point. As I say, there were various stages. The Gambling Commission took over a year to withdraw the licence and say that Football Index’s product was an exceptionally dangerous pyramid scheme under the guise of a football stock index. By submitting a written question to Ministers, I found out that it then took over a year for the Gambling Commission to warn the Department for Digital, Culture, Media and Sport. It was not until 10 March 2021 that a letter went from the Gambling Commission to DCMS. In that year, a gaping black hole existed, and through that black hole went the hard-earned savings of my constituents and those of many others. Millions of pounds went down that black hole.

As hon. Members have said, there is a wider point. The scandal points to yet another failure of financial regulation in the UK. The FCA was set up to protect consumers, but we saw that it failed to act over the collapse of London Capital and Finance, which affected other constituents of mine, and many other schemes have taken people’s hard-earned savings. The FCA needs to be strengthened, because we cannot have a financial regulatory regime that is effectively a Potemkin village that exists in name but takes no real action and does not do enough to warn people about scams. My constituents, and the thousands who have been conned out of their money, deserve better than this.

17:07

[Mick Whitley (Birkenhead) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Ghani. I thank my hon. Friend the Member for Blaydon (Liz Twist) for securing this important debate.

The collapse of Football Index in March 2021 left a trail of human misery in its wake. Some £90 million-worth of open stakes has vanished, with an average loss of £3,000 per customer—a life-changing sum for anyone. For some of the people I represent, however, those losses have been far greater still. I have heard from pensioners whose entire life savings have been snatched away, and from constituents who lost more than £100,000 when the platform collapsed. My constituents are not stupid, and nor are they gamblers whose luck simply ran out. They are victims of an unscrupulous, if not outright criminal, scheme that wilfully misled the Gambling Commission, pedalled lies about the state of its financial health, violated the terms of its licence and cynically preyed on fans’ passion for the beautiful game. They deserve so much better than the condescension that has accompanied Football Index’s demise.

Few have been quite as tone-deaf as the chief executive officer of the Gambling Commission, Andrew Rhodes, who had the temerity to lecture victims still coming to terms with their losses by saying that

“no one should gamble more than they can afford to lose.”

In fact, Rhodes and the commission he oversees still have serious questions to answer about their role in this whole saga, because if this is a story about unchecked greed, it is also a story of chronic regulatory failings. The Gambling Commission issued a licence for a product that it did not understand, and ordinary customers were forced to pay the price. Despite receiving warnings about systemic flaws with the index in January 2020, it was not until May 2020 that the commission began investigating. In that time, Football Index signed a sponsorship deal with Queen’s Park Rangers, lending further legitimacy to this elaborate pyramid scheme.

The simple truth is that thousands of Football Index consumers were failed by the very people who were supposed to protect them. My constituents now deserve justice, but despite the publication of the independent review in September last year, it still seems to be a long way away. Successive announcements by both DCMS and the Gambling Commission that no compensation will be made available will come as a bitter blow to people living in my constituency, whose lives have been changed irrevocably as a result of the collapse, and the continued existence of platforms seemingly mimicking Football Index’s business model—including AllStars Trader, which is run by a former Football Index employee —shows that not nearly enough is being done to stop the catastrophe repeating itself. The fact that Football Index was allowed to trade without any oversight from the Financial Conduct Authority, despite styling itself as a trading platform, shows just how badly regulatory reform is needed.

Football Index was not the only app that encouraged ordinary people to hand over small fortunes with the promise of massive returns. In recent years we have seen a massive upsurge in a number of online trading platforms becoming available to ordinary people, such as eToro, Freetrade and Robinhood. Like Football Index, those apps promise ordinary people a way to break into a world previously dominated by big banks and the mega-rich. Those sites, although legal, tempt ordinary people into ploughing massive sums of money into investments that they often have no hope of understanding. Many even model themselves on video games, with users receiving constant pushes to keep investing more.

Despite the obscene amounts of money involved, Ministers are still playing catch-up, and today the world of online investments resembles the wild west, with ordinary people enjoying little to no protection from financial ruin. Without far-reaching reform of the regulations governing those platforms, I fear that the Football Index scandal is doomed to repeat itself. Ministers must act now.

17:10

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

I have a number of constituents in North Ayrshire and Arran who have lost significant sums of money as a result of the collapse of Football Index. Football Index customers were not properly protected, as we have heard today. We know that the Gambling Commission ignored warnings about the business model of the platform, and that the Financial Conduct Authority identified areas for improvement for the company.

The whole shameful episode underlines exactly why we urgently need gambling reform. Gambling must be better regulated. The Gambling Commission, which failed Football Index customers, must be more effective. Customers must have confidence that they will have better protection in future. It is very disappointing that there seems to be no route for redress for those who have suffered significant losses following the collapse of Football Index. In total, about £90 million was lost.

That platform was approved and its licence authorised by the Gambling Commission. The Gambling Commission failed to carry out due diligence, and consumers have paid very heavily for that failure. How is that fair? Why should unsuspecting customers pay for that failure? Clearly, the Gambling Commission’s conduct and competence was not what it needed to be, and its regulation and effectiveness of enforcement was not fit for purpose. One of the many lessons to learn from that is that we must have a gambling ombudsman, to ensure that consumers have a clear avenue for redress.

Those who were caught up in the Football Index scandal and lost a lot of money have been failed at every turn by the very regulation that is supposed to protect them. I urge the Minister to put that right and to not fail them again by turning his back on them. I urge him to compensate the victims and ensure a full review of the Gambling Act 2005, informed by the independent report on the regulation of Football Index. This cannot be allowed to happen again. The whole gambling industry, as well as consumers, will benefit if there is legislation and protection in which everyone can have confidence.

[Ms Nusrat Ghani (in the Chair)]

Before I call Ben Lake, I want to say that, because everyone’s contributions have been remarkably in time and so powerful, the Opposition Front-Bench spokesperson will have four minutes and the Minister will have eight. I have no doubt that he will take many interventions.

17:13

[Ben Lake (Ceredigion) (PC)]

It is a pleasure to serve under your chairmanship, Ms Ghani. I thank the hon. Member for Blaydon (Liz Twist) for securing this important debate.

The collapse of Football Index has wrought devastation on so many of my constituents, as it has for those of many hon. Members. I have heard stories of people losing deposits for their first homes and savings for marriages. Lives have been ruined. I associate myself with the comments of the hon. Member for North Ayrshire and Arran (Patricia Gibson), in which she completely demolished the regulators by outlining the failure to prevent this crisis.

The Government’s independent report showed that the platform was not properly understood by the Gambling Commission, which did not carry out effective scrutiny of the product or respond quickly to the issues raised. The same could be said of the Financial Conduct Authority. I associate myself with the comments of the hon. Member for Ellesmere Port and Neston (Justin Madders), in saying that we must not allow the false narrative to emerge that these people gambled too much and were irresponsible. Far from it—we heard of insiders warning regulators, trying to blow the whistle on the failings, in 2020.

The UK Advertising Standards Authority also ruled against Football Index on a number of occasions in the years preceding its collapse, including for not making the financial risks of its product clear, and in particular for creating the impression that it was an investment opportunity rather than a betting product. The last ruling was made in September 2019, which prompts the question: why were these warning signs not heeded by the other regulators?

That the ASA ruling led to no meaningful action being taken by either the Gambling Commission or the FCA compounds the litany of failures that led to the current situation—one that could and should have been avoided. Many, possibly all, of us are supportive of compensation for those who have lost out from Football Index.

I am anticipating some of the reasons why the Government might say they will not issue financial redress. Why not use the sizable funds levied by the Financial Conduct Authority and the Gambling Commission from fines and regulatory settlements to pay back Football Index users? For instance, the Gambling Commission issued £58 million-worth of fines between June 2014 and December 2019. More recently, it issued a £9.4 million fine to online operator 888, and the FCA fined GAM International over £9 million just last month. Why cannot those funds be allocated to contribute towards financial redress for those who have lost an estimated £90 million? They certainly deserve it, because it is clear that the regulators with the duty to protect them failed.

17:16

[Ronnie Cowan (Inverclyde) (SNP)]

I congratulate the hon. Member for Blaydon (Liz Twist) on bringing forward this debate. I was assured as recently as this morning in this very room by a Government Minister that the gambling review White Paper is due in the coming weeks. Minister, we cannot keep meeting like this. Among a range of reforms, the gambling review White Paper must effectively regulate the digital age, and consumers must be better protected from Ponzi schemes.

BetIndex Ltd, trading as Football Index, was a sports betting platform. An operating licence was issued to BetIndex by the Gambling Commission in September 2015. It was BetIndex’s decision to dramatically decrease its dividend payment by 82% that led to a virtual market crash on the site. Scandalously, days before the crash, Football Index minted new shares in footballers, enticing consumers to purchase shares that some days later would be worth far less than their former value.

[Jim Shannon (Strangford) (DUP)]

One employee from the firm stated that 100 people were employed by Football Index. Some, but not all, of those had salaries of £1 million. Does the hon. Gentleman feel that the investigation should pursue the directors, who seem to be well off at this moment?

[Ronnie Cowan]

Absolutely. I will touch on that briefly later. I watched “Question Time” from Belfast a couple of weeks ago, and I was surprised that the hon. Member for Strangford (Jim Shannon) did not intervene at any point.

BetIndex failed to properly notify the Gambling Commission of the nature of the product in its licence application. The Gambling Commission could have responded better, with earlier scrutiny of the product offered by BetIndex, quicker decision making and action, and better escalation of the issues, but it did not do so. The Gambling Commission ignored warnings that its business model was flawed and that customers’ money could be at risk. Although Football Index was not regulated by the Financial Conduct Authority, the report identified areas for improvement for the FCA. Those included its speed of response to requests from the Gambling Commission.

Football Index is a scandal that underlines the need for wholesale reform of the gambling industry and raises significant questions about the Gambling Commission, given that it saw fit to license the platform and failed to enact adequate oversight. In the regulated sector, when people gamble they should have confidence that they are doing so on the basis of the outcome of a wager. It should not be a gamble on the solvency or sustainability of the licensed operator.

This scandal shows how much a gambling ombudsman is needed to ensure that consumers have a clear avenue for redress in circumstances such as the Football Index scandal. The Government said that they would not use public funds to compensate customers who have lost money, despite customers losing up to, at a modest estimate, £90 million. BetIndex Ltd was approved and operated a licence authorised by the Gambling Commission. The failure is on the regulator as much as it is on the Ponzi scheme that stole consumers’ cash. The Government should be doing more to protect their citizens and should act swiftly when they have let them down. The ex-CEO of Football Index, Adam Cole, has been named persona non grata by the Jersey Gambling Commission, with the regulator citing the executive’s track record as the reason for its decision. While the Jersey Gambling Commission has stepped up, there are no immediate plans for the UK Gambling Commission to act.

At the heart of the scandal are those robbed of their money. One football fan has revealed that he lost £98,000, saying:

“It has completely torn my life apart…It is all the money I’ve ever saved, almost everything I’ve ever had and has put quite simply left me on the verge of committing suicide.”

This is a wrong that needs to be made right through better legislation, stronger enforcement and compensation to those swindled by BetIndex.

17:20

[Jeff Smith (Manchester, Withington) (Lab)]

It is good to see you in the Chair, Ms Ghani. I pass on the apologies of the shadow Minister responsible for gambling, my hon. Friend the Member for Pontypridd (Alex Davies-Jones), for her absence. I congratulate my hon. Friend the Member for Blaydon (Liz Twist) on securing this debate, and thank her for everything she does in fighting for justice for those affected by the collapse of Football Index.

Like me, most MPs will have heard examples of the devastating impact of the Football Index collapse on their constituents. The sheer number of MPs wanting to take part in an hour-long debate is evidence of the seriousness of the issue. Members on both sides of the Chamber have made excellent speeches articulating the pain that many of our constituents have gone through. People have lost tens of thousands of pounds that were supposed to be for their families’ future. Marriages and relationships have fallen apart. The stress and guilt of the experience have induced severe physical health problems; people are even suffering from depression and becoming suicidal. It should never have been allowed to happen.

It is clear that there has been a massive failure of regulation. When the Government commissioned their report on the collapse, there were concerns among those affected that the review did not sufficiently interrogate or challenge the Gambling Commission’s explanation of events, and I would be grateful to hear the Minister’s comments on those concerns. Nevertheless, the report identified clear failings: BetIndex did not properly notify the Gambling Commission of the nature of and changes to the product in its licensing application; the Gambling Commission responded slowly to the challenges raised by the product; and the Financial Conduct Authority could also have done more to help.

Perhaps the most devastating aspect of the scandal is that many of those who ended up losing money believed that what they were doing was safer than what we might call normal gambling. The marketing for the product was couched in the language of investment, not betting, and it was promoted as a safe venture with “guaranteed yields”, which led people into this position. The fact that the product was licensed, appeared in TV and radio adverts and acted as the sponsor on the football shirts of three teams gave it an air of legitimacy that it should not have had. It was a major failing of regulation and demonstrates why we urgently need reform.

Reports suggest that the long-overdue gambling White Paper is finally set to be published this month. I repeat the plea I made to the Minister when we faced each other this morning in this Chamber that this is urgent. Earlier, the Minister said that the White Paper would be published in the coming weeks, which is welcome. Can he confirm that it will be before the summer recess? That would be welcomed by people who have been affected by this scandal and by other problem gambling, because we need the time to assess and debate it.

That kind of wide-ranging and evidence-based reform of our gambling legislation will hopefully prevent anything like this from happening again and impacting on others in future. Of course, the hope of future reform, and the improvements so far from the Gambling Commission, do nothing to help those who have already been impacted. The Government have said that they will not use public funds to provide compensation for the losses caused by the Football Index collapse. They have signposted those affected to seek reimbursement from BetIndex’s liquidation process, but it is becoming clear that the process will not yield enough to those who have been failed.

Many have called for the creation of an ombudsman to get redress for Football Index’s victims. The Opposition think that the Government should look seriously at that useful proposal. There certainly needs to be more action to get redress for victims. The collapse of Football Index has had a shattering impact on many people’s lives. People were badly misled, and our existing regulatory mechanisms failed. It cannot happen again.

17:24

[The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)]

It is a pleasure to serve under your chairmanship again, Ms Ghani.

I should like to begin by thanking the hon. Member for Blaydon (Liz Twist) for securing this debate, and all those who have contributed to it. She and many others have raised the collapse of Football Index with my Department on a number of occasions. I apologise on behalf of the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South (Chris Philp), who has ministerial responsibilities for gambling, but he cannot be here, as he is serving on a Bill Committee. As tempting as it is to make all sorts of promises on behalf of another Minister, I had better not do so. I will try to answer as many questions as I can, and where I cannot do so I will ask my hon. Friend the Member for Croydon South to write to hon. Members.

I will not detain Members by going through the full history of Football Index or explaining what the product is. I think that most Members in the Chamber unfortunately are quite familiar with the circumstances, but it is important to give a brief outline of what happened. BetIndex was licensed by the Gambling Commission in September 2015, and it operated a product called Football Index. The commission’s scrutiny of the company increased in May 2019, when an internal compliance assessment flagged a number of concerns. In July 2019, the commission contacted the Financial Conduct Authority to ask for its view on BetIndex’s activities due to some of the features of the product, which have been outlined by hon. Members. The commission subsequently launched a formal licence review in May 2020. It cited a number of concerns about the product, including terms and conditions.

The investigation was in train when, in March 2021, the commission learned that the company planned to suspend its operations and freeze customer funds, which would breach its licence conditions. The commission suspended BetIndex’s licence and the company subsequently entered administration. The reasons behind the collapse of BetIndex are important. The suspension of football matches during lockdown in March to June 2020 played a significant role in the financial difficulties that the company faced. Its business model was based on live football and media coverage of it. For a period of time, that did not exist. In March 2021, BetIndex announced a drastic reduction in the returns that it paid out to customers. It hoped that that would allow the company to recover and customers to continue using the product, but unfortunately that failed.

The Government took the concerns of those affected by the collapse of Football Index very seriously. That is why we acted quickly to appoint Malcolm Sheehan QC in June last year, to lead an independent review into the regulation of the company. We are grateful to Mr Sheehan and his team for their extensive investigation, thorough report and clear recommendations, which we have welcomed. The review highlighted a number of wider factors relevant to the way in which this situation came about, including the actions of BetIndex and the impact of covid, as I have mentioned, but it also identified areas for improvement for both the Gambling Commission and the FCA. Areas for improvement have been highlighted by several hon. Members today.

As my hon. Friend the Member for Croydon South said in his written ministerial statement in September last year, the report identified areas where the commission could have been more effective in responding to the challenges raised by the novel product—Football Index—including earlier scrutiny and the speed of decision making. Although BetIndex was not regulated by the FCA, the report also looked at the FCA’s role in working with the commission, and identified some areas for improvement, including the speed of response to the commission’s requests.

I am pleased that both bodies have acted on the recommendations to ensure that a similar situation does not happen again. That is a key ask from many Members today. Actions have included such things as the Gambling Commission updating the way in which it assesses risk so that novel products are properly considered; and the commission publishing a consultation on changes to its licensing policy, clarifying that it will not normally grant a licence to products that contain language associated with financial products or which require dual regulation.

[Sir George Howarth]

Does the Minister accept that if people are going to be compensated for the losses that they have sustained, that will require active intervention from the Government? Will he consider the suggestion made by the hon. Member for Ceredigion (Ben Lake) about using fines as a possible way of compensating people?

[Nigel Huddleston]

I was going to come on to that point. Unfortunately, that ask is not possible, for a couple of reasons. The FCA is required by law to pass revenue from fines to the Treasury, net of enforcement costs, and the Treasury is required to place that into the Consolidated Fund, to be used for Government Departments on important public services. That is the law. The Gambling Commission fines are used for socially responsible purposes, usually for specific projects to reduce gambling harms. I completely understand the intend behind the request, but I am afraid that it is not possible.

Going back to the changes made as a result of the recommendation, the Gambling Commission and the FCA are also signing a strengthened memorandum of understanding to improve co-operation, and the FCA has nominated an executive director to oversee its relationship with the commission. Therefore, some changes have already happened and others are happening now.

Even though the independent report has been published, other processes are ongoing. First, administration proceedings continue, which may result in some money being refunded to customers. Secondly, the Gambling Commission referred BetIndex to the Insolvency Service and asked it to consider whether the actions of BetIndex’s directors prior to administration breached insolvency or fraud laws.

[Ronnie Cowan]

I have listened to what the Minister has said about compensation. Under section 123 of the Gambling Act 2005, the DCMS Secretary can impose a levy, at the level they determine, for any purpose whatsoever.

[Nigel Huddleston]

With regard to compensation, as I have said, there are procedures that we cannot move from. It is also very clear that we strongly sympathise—everybody strongly sympathises. As a constituency MP, I also have constituents who have been impacted by the collapse and who have lost money. We have heard today anger and frustration about the genuine hardship—both financial and, of course, mental—caused by the collapse. However, we do not think it would be appropriate for the Government to use public funds to cover losses to individuals resulting from the collapse of a gambling company. Consumers staking money on gambling is not the same as their placing money into other things, such as savings products. Furthermore, the Gambling Commission does not have any statutory powers that would enable it to offer redress for losses suffered as the result of a gambling operator collapsing.

I know that I need to leave time for the hon. Member for Blaydon to respond to the debate, so I will briefly refer to a couple of other points that hon. Members have made. On the Insolvency Service investigation, BetIndex entered into administration on 26 March 2021 and administrators are required to report to the Insolvency Service on company directors’ conduct. Following information received from the administrators and the Gambling Commission, the Insolvency Service has confirmed that it is investigating the conduct of BetIndex’s directors.

The hon. Member for Blaydon asked for a meeting with the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South. I will pass that request on, rather than make a promise on his behalf, but I am sure that he will receive that request with respect. I will also ask him to respond to a couple of other items that she asked about. Please be in no doubt of the seriousness with which the Government take all the matters that have been highlighted today, and the gambling review will indeed be announced in the coming weeks.

[Ms Nusrat Ghani (in the Chair)]

Ms Twist, you have about a minute in which to wind up.

17:33

[Liz Twist]

I thank every Member present, from every nation and every party, for being united in one object—seeking redress and making sure that things like this cannot happen again. I also thank all those Football Index “investors”—which is what they thought they were—for their help in this debate. I welcome the Minister’s assurance that he will refer my requests to the relevant Minister, and I look forward to hearing back directly, because there is ground for further discussion.

Question put and agreed to.

Resolved,

That this House has considered the impact of the collapse of Football Index.

17:34

Sitting adjourned.