Westminster Hall

Wednesday 28th June 2023 Westminster Hall

Wednesday 28 June 2023

[Mr Laurence Robertson in the Chair]

Mortgage Prisoners

Wednesday 28th June 2023 Westminster Hall

09:30

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

I beg to move,

That this House has considered mortgage prisoners.

It is good to see you in the Chair, Mr Robertson. I want to begin this vital debate with something of a confession: like most Members, I did not know too much about mortgage prisoners until just a couple of weeks ago. While I understand that many here today will have been working away on the issue for a while and may be members of the all-party groups, I am still in a state of astonishment and, frankly, anger that the situation happened in the first place and has been perpetuated, I have to say, by successive British Governments.

While it may be convenient to lay these problems at the current tired Government’s door—I hope the Minister will take that in the way it is meant—many of the disastrous decisions that brought this about took place under the previous Labour Government and have simply been rolled over in more than a decade of what seems like unbearable mental torture for those who are stuck in this predicament.

Let me thank my constituent Chris Dorman from Duntocher for allowing me to bring this issue before the House and for agreeing to share their story and that of their family so publicly. I am only sorry that in instances like this, we as MPs so often find it difficult to address historic injustices and can only highlight them and hope that the Government of the day will listen.

Before I tell Chris’s story, I want to be clear at the outset about the questions to which I would like answers from the Minister. I think we now need to also ask the shadow Minister, the hon. Member for Ealing North (James Murray), to consider them. Can we have a moratorium on evictions for mortgage prisoners? Can we put a cap on the standard variable rates being offered to victims? Will the Government—and, I hope, the official Opposition—pledge to set up a vehicle to work cross-party for those in closed-book prisons to pivot back into the mainstream market? Those are three fairly straightforward asks, to which the Minister can now take over an hour to find an answer; I may go on for some time. I know that those watching at home, including Chris and his family, will really appreciate an answer.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I thank the hon. Member for securing the debate, and as the founder and co-chair of the all-party parliamentary group on mortgage prisoners I thank him for the work he is doing on the issue. The last Labour Government introduced a consultation to ensure that there was some protection for people when mortgages were sold on, and those measures were pulled away when the Conservatives came into power. Does he agree that we need to go back to those considerations? I support what he said about the cap on SVRs—the APPG has been calling for a cap of 2% above the base rate.

[Martin Docherty-Hughes]

I thank the hon. Member for that intervention. I will go on to the history of some of this. I hope that the APPG agrees not only about a cap on the standard variable rate, but about the other two issues I highlighted. I would be happy to work with the all-party group in future.

Let me turn to my constituent Chris Dorman. I have known Chris and his family over many years, especially his mum Rose, who was and remains to this day a legend in the history of my home town, Clydebank—a working-class history that is so seldom related or reflected in a place such as this. She was one of the founding members of the first credit union in Scotland, the Dalmuir Credit Union, helping countless families just like the one I grew up in. I was member 507; that takes me back some time.

That is relevant—and I hope the Minister will understand this—because we need to begin any discussion about mortgage prisoners with the firm rebuttal of any idea that these people are bad borrowers who are to blame for their own predicament. Chris comes from a family who know how mortgages work and how people should go about choosing a lender and a product that will not cause problems for them or their family in future scenarios. When he took out the mortgage with Northern Rock in 2003 to buy a flat, I do not doubt that he would have kicked the tyres of the agreement and known where to look for potential pitfalls. Of course, he would not have found any.

Northern Rock was a triple A lender, one of the largest lenders in the country and a fast-growing national presence that still had its roots in the north-east of England. I know about this because I got my first mortgage with Northern Rock at around the same time—and believe me, this is the point where I start to think, “There but for the grace of God go I.” I do not think it will be the last time in this debate when that is my overriding emotion.

In 2007, as Northern Rock crumbled in the bank run that heralded the next year’s financial crash, Chris was forced on to an interest-only plan. Although for many people switching to an interest-only payment is a stopgap because of short-term financial circumstances, for people in Chris’s position it has been the beginning of their problems. That entirely understandable decision has rendered them unable to change their lender, as many of us do these days, and move to a more attractive rate.

Instead, through the actions of the now nationalised Northern Rock, Chris was flung to the mercy of a standard variable rate that began to diverge significantly from the Bank of England’s average SVR. The decision was quite deliberate. During a period when we were all dealing with the most significant global recession for decades, people like Chris were having to come to terms with that extra dollop of uncertainty. They probably did not know it at the time, but what would initially have felt like a short-term inconvenience was turning into an actual prison, even if there were already some organisations sounding the alarm.

Like so many, and some of our own constituents, Chris was forced to persist with an entirely inconvenient and increasingly costly arrangement and unable to switch to a better deal, making a mockery of the idea of home ownership and the free market being liberating for individuals and families. Through the last decade he has been paying the 6% or 7% interest rates that many of us now complain of today.

This is where we begin to see a bit of the societal impact of the policy. The village of Duntocher, where Chris lives, is a fairly normal part of my constituency socioeconomically. It has poverty and wealth; it is not the wealthiest part of West Dunbartonshire. It is a community—it was an ancient Roman site and then a mill town that predates Clydebank itself—that has a lot of small locally owned businesses, which would have benefited from the thousands of pounds each year that Chris and his family were overpaying on their mortgage.

Let us not forget that for well over a decade the UK Government were the ultimate holders of that mortgage, through UK Asset Resolution. I can imagine myself thinking that the Government would not do anything so deliberately to harm the hundreds of thousands of UK residents in this position and that a sensible resolution would eventually be found. As we will see, there were numerous attempts to address the issue through the various Conservative Governments we have lived through so far. It was not a purgatory before things got better. They were about to get worse.

In 2019, UKAR sold a tranche of books, including Chris’s, to a company called Heliodor. He had never heard of it, and with good reason, because it is an entity that neither I nor any of us here could borrow from. It is a vehicle that exists solely to serve the existing Northern Rock mortgages. Although it operates in a regulated market, Heliodor’s ultimate owner, Topaz Finance Ltd, is not a regulated entity and relies on third-party administrators who are regulated by the Financial Conduct Authority in order to comply with its regulations.

However, and significantly in Chris’s case, as Kath Scanlon et al’s report from the London School of Economics points out, the setting of SVRs is not a regulated activity, meaning that a business opportunity for morally ambivalent vulture funds such as Topaz has been created, and people—our constituents—are offered up as hosts for a parasite.

Despite never having fallen behind on his payments, Chris found himself subject to a host of fees and other spurious admin charges. Incredibly, the principal he owed rose by almost £10,000 in a few short years, with no additional lending being offered. That pushed Chris into negative equity, as the amount he owed Heliodor became greater than the value of the flat he shares with his wife.

[Mr Philip Hollobone (Kettering) (Con)]

I congratulate the hon. Gentleman on his speech and on securing the debate. My constituent Valerie has written to me. She is a mortgage prisoner, one of 200,000 across the country. She says exactly what the hon. Gentleman has said about Chris:

“I have been a mortgage prisoner since the initial crash of the market and despite never having missed any payments or been in arrears I am unable to remortgage as I cannot meet the new current affordability rates due to the LTV ratio of my property. I am now paying an almost 8% variable rate.”

Is it not the key point here that mortgage prisoners such as Valerie have done nothing wrong? They have met all their payments and have never been in arrears, but they are trapped. They urgently need relief from the Government.

[Martin Docherty-Hughes]

I thank the hon. Gentleman for his intervention. He is correct, and the Government need to listen and take immediate action not only for Chris, but for the hon. Gentleman’s constituent and the more than 200,000 others who I am sure are in the same predicament.

The cruellest part of this sorry tale of modern Britain is this: as Chris approaches the end of the 25-year term of his mortgage, having been forced into the interest-only plan just a few short years after he began to make repayments, he risks losing his family home of a quarter of a century unless he can come up with the full amount he owes to Heliodor. The aspect I find most galling is the inversion of the principle of home ownership, whereby people have ended up paying what is essentially rent to a vulture fund, which almost certainly knows it will be able to acquire the property at the end of the term.

Topaz Finance will have been licking its lips, I am sure, at a deal that is basically guaranteed to be paid twice: first, through the monthly payments that Chris and his wife have been making, and secondly when Topaz Finance sells their home from under them in 2029, at a healthy profit over what it picked the property up for in 2019.

As the House can imagine, the toll this has taken on Chris has been severe, as I am sure it has been for many of our constituents. Chris is unable to work, owing to the mental and psychological strain the situation has provoked, so it is down to his wife, a nurse, to work all the hours she can so they can stay in their home, although they understand the bitter irony that that is only a temporary respite until the hammer inevitably falls in 2029.

It is up to us as Members of Parliament to make sense of this personal calamity—not only for me and for Chris, but for the constituents of other Members—and to think of the consequences of Chris’s story, with hundreds of thousands of people across these islands potentially affected. It is unthinkable.

In such a situation, how do we even begin to ensure not only that our constituents are protected from the avarice of these vulture funds, but that, somehow, there is some sort of recognition of the years they have lived under ever-increasing pressure? How do we make up for the opportunities missed—holidays not booked, families unable to grow, dreams unrealised? As Chris has said to me, this is essentially a form of legalised loan sharking, although unlike illegal loan sharks, vulture funds such as Topaz Finance do not break your legs, Mr Robertson; they break your spirit.

A small gleam of light has been the dawning realisation among mortgage prisoners that they have been exploited by so many of the actors that we are going to hear about today, and I want to thank UK Mortgage Prisoners for the work it has done, including the group’s most recent report, “Setting the Record Straight”, which helped me to understand that, tragically, the experience of my constituent Chris is very much not unique.

In the second part of my speech, I want to explore the opportunities to avoid this disaster that were missed along the way, and to ensure that the possibility of tens of thousands or hundreds of thousands of mortgage prisoners being put out on the street and coming within the ambit of local councils and social services is very much acknowledged. It is important to cast our minds back to 2008, when Northern Rock was a prime lender and in the top five nationally. The LSE report I cited puts it very well:

“The problem of mortgage prisoners was largely created by the actions of successive UK governments in trying to address the excessively risky lending of the early 2000s. The prisoners…are a legacy of the rapid mortgage market expansion that took place prior to the Global Financial Crisis”.

By now we all know about the plethora of seemingly innovative mechanisms to enable wider home ownership, including high loan-to-value ratios. The banks that offered those novel products, such as Northern Rock or Bradford & Bingley, were household names—well-known brands that did not make people think twice about borrowing with them—and even the then Chancellor of the Exchequer, Alistair Darling, stated clearly in 2007:

“I can tell the House that Bank of England lending is secured against assets held by Northern Rock, which include high-quality mortgages with a significant protection margin built in and high-quality securities with the highest quality of credit rating.”—[Official Report, 19 November 2007; Vol. 467, c. 960.]

When those books were brought under the auspices of UKAR, borrowers could have been forgiven for thinking that all would be well: they were paying their mortgages, and the UK Government would ensure that they were not taken advantage of. However, even then there were warnings, inside and outside Government, about the potential risks of that approach. In 2009, the consumer group Which? told the Treasury Committee:

“Northern Rock’s mortgage business strategy seems to consist of telling many of its existing customers to go elsewhere and coming down hard on those who have got nowhere to go by having a relatively high standard variable rate and a ‘rapid’ move towards repossession.”

Even the Treasury, in the same year, was quite clear about the risks of allowing those unregulated firms to take over the Northern Rock book. It stated in a report that firms not engaging in regulated activity are not bound by the requirements of the FCA regulations, including, importantly, the requirement to treat customers fairly. It said:

“Non-regulated owners of regulated mortgage contracts may seek to maximise margins by raising interest rates and charges, potentially to levels that are unaffordable to borrowers.”

The same document stated, clear as day:

“Such activity clearly has the potential to cause severe harm to borrowers”.

Yet, incredibly, the UK Government carried on regardless.

Despite interest rates falling as the recession bit, that Government-owned bank settled on a margin of 4.29% over base for its SVR—an increase of 205% in its first year of operations. That is a scandal. In doing so, it made the prison absolutely complete, and hundreds of thousands of our constituents paid over the odds for a product they had bought in good faith, without being able to go anywhere else.

Why did that happen? The best explanation I can find is in the UK Mortgage Prisoners report, which says that the UK Government wanted to

“sell the books as soon as possible for as high a price as possible.”

The action group’s report is a damning indictment of the continued failures of Government policy, but it manages to keep the obvious emotional distress caused to its members just below the surface, to devastating effect. In meticulously researched tables, we see in black and white the money that has been lost to our economy from the detriment of keeping the SVR well above the base rate. From my calculations—I stand to be corrected by Chris—my constituent and his family have overpaid by at least £40,000.

If we cannot take away the pain and suffering this issue has caused over the years, we at least owe the victims an answer about why it happened. The LSE attributes it to the general climate created before the 2008 crash, but it is important to acknowledge how deep these roots are, because we are still dealing with so much of the fallout today.

The long tail of that era of neoliberal economics is still pernicious, because it confuses concepts such as taxpayer value with what any of us would normally take it to mean. Taxpayer value, to people like me, is not found in pauperising hundreds of thousands of households. It is not to be found in scraping back every single penny that taxpayers saw spent on ensuring that the economy did not collapse overnight.

Government is not a bank, with shareholders that need to see the principal of loans paid back in full. Government is an institution that is able to intervene in the economy at strategic moments. That is an idea that is slowly coming back into fashion, but I wonder how many of our national assets have found their way into the paws of this type of offshore capital in the intervening 40 years, leaving the taxpayer with all the costs, none of the benefits and absolutely hee-haw value.

The Government share much of the blame, and I am sure that we will hear from others of their myriad failings over the years, but we should take a moment to remember that the policy was conceived and established under a British Labour Government. Furthermore, that Government fully embraced the model of deregulated, neo-liberal economics; they continued the Thatcherite legacy of public assets being valued only where they were on the balance sheet, and taxpayers existed only in the abstract, not as individuals.

It was Gordon Brown—that saint who, we heard last week, could be elevated to the House of Lords—who set up the very FSA that allowed this tragedy to happen. The FSA, in his now infamous words, would herald

“not only light but limited regulation”

of financial markets. However, it will not do Chris or our constituents much good to dwell on the past. As I draw my remarks to a close, let us revisit my three questions for the Minister, which I think the shadow Minister should also reflect on. First, on evictions, as we begin to reach the end of the terms of those who took out 25 or 30-year mortgages at the beginning of the century, let us do what we can to lift the burden that they have carried over the years. I know, from reading briefings, that the Government are concerned about what they call the moral hazard of acting. If these people, in 2023, have not already had their houses repossessed, they must necessarily have kept up with repayments, so there is a strong case for saying that the moral hazard lies in the other direction: companies have been deliberately stringing them along.

Secondly, surely it is natural to put a cap on the SVRs being offered to mortgage prisoners, especially given the general climate of mortgage instability. Our constituents have been coping with high interest rates for a considerable time. We gain nothing from pushing them further into debt, and in the past couple of days, some interest rates have been around 12.6%. Of course, there will be a cost to the taxpayer in the abstract, but this move will be an investment that pays itself back through the cascade of money into our local economies, instead of into the pockets of offshore vulture funds. The day of balance-sheet economics needs to end.

I understand that an amendment to the Financial Services and Markets Bill was put forward in the other House by the co-chair of the all-party parliamentary group. I would be interested to hear whether the promise that the Government made when that amendment was withdrawn, to meet mortgage prisoners, has been fulfilled. The Minister knows a lot about that Bill.

Finally, the Government owe it to mortgage prisoners to find a way for them to help themselves out of this mess. They should look into providing a vehicle that allows mortgage prisoners to pivot back into the mainstream market. The first suggestion of the LSE report is that there should be free, comprehensive financial advice for all victims; almost 200,000 people should be contacted individually to help them navigate their way out of the quagmire that they find themselves in. As I said, it gives me no pleasure to conclude that it appears that there is nothing that we can do to make up for what UK Mortgage Prisoners calls the

“extortionate interest rates, severe financial restrictions and mobility and mental & physical issues caused by this Government-made scandal.”

However, that does not mean that we should not try. I hope that the Minister and the Government can see from the interest in today’s debate that they now have a chance to do what they can to make things right.

09:55

[Duncan Baker (North Norfolk) (Con)]

It is a pleasure to serve under your chairmanship, Mr Robertson. I thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes), who has just made an incredibly powerful speech.

Twice this week, I have spoken in Parliament about the banks and how constituents have been let down. The situation with mortgage prisoners is a scandal in its own right, and a great problem is that it is frankly not spoken about anywhere near enough in this House. For those of us who have constituents who are affected by the situation, as I do, it is utterly heartbreaking to hear the stories. We often hear stories of people’s plight in this place. The plight and the financial situations of mortgage prisoners are particularly devastating.

I am rarely lost for words, but yesterday, when I came off a call with a constituent who had given me an update on her story, I realised I had found it an incredibly emotional experience. I will not use her name, but she is one of 195,000 people across the country affected by this problem. Many people around the country will be struggling with higher mortgage rates, but mortgage prisoners are in an entirely separate situation; they are in a degree of difficulty that is beyond what the average person is probably experiencing with their increasing mortgage rate. That is through absolutely no fault of their own, but because of the situation that occurred back in 2008 with the banking crisis.

My constituent’s situation is, I am sure, replicated among the 195,000 people affected by this problem. She is paying £1,782 a month for her mortgage. She is in arrears. She is under a Heliodor mortgage—the hon. Member for West Dunbartonshire mentioned that lender; I had never heard of it either—and is paying 9.24% to a lender that does not even have a lending licence. Many statistics suggest that the mortgage rates of millions of people across the country are shooting up by 5% or 6%, but some mortgage prisoners are paying 12% or 13%. Can anyone imagine what that pressure and stress must be doing to those households? The average mortgage prisoner is paying 9%. As has been echoed by hon. Members, we absolutely need to look at the standard variable rate, specifically for mortgage prisoners, because it is not right for families to end up in that situation. They are utterly trapped by what happened back in 2008, when mortgage books were sold off.

Another issue is that many mortgage prisoners are now older families; they got into this situation some 15 years ago, when the banking crisis first happened. In my questioning, I try to understand the situation. I ask questions such as, “Well, why can’t you exit this financial arrangement by selling up and moving on?” It is not that simple for families, who may well have children. The lady I spoke about has a family of three, and one child is disabled. Her situation is creating untold distress for her, and is affecting her mental and physical health. In constituencies such as mine, people cannot just sell their house and find another at an achievable price. I live in a beautiful area on the north Norfolk coast, where house prices are extremely high, the rental situation is extremely difficult, and the local housing list has roughly 3,000 people on it.

These are people’s homes. They are private homes. We must have some compassion and help people who, through no fault of their own, have ended up in this situation. As has been said, people cannot just move to another mortgage product, because they will simply fail to meet the lending criteria and the affordability test. My constituent was in a perfectly normal mortgage until the collapse of Northern Rock. We are told that there is help and support out there, but that is not always the case.

I am on the record as saying on Monday night that the Minister is a good man, and that when I talked about banking hubs, he listened to all the problems that I brought him about bank closures in my constituency. I say that again. If his officials are watching, will they please help my constituent? She would readily listen to help and advice. I asked her what one thing would help make the problem go away. One of her answers was, “Will the Minister engage with the mortgage prisoners group, so that he can understand the situation for so many people who have worked hard and got into this situation?”

Let me finish by saying that the Government have done a good job of dealing with the escalating problem of interest rates in recent weeks, including through the Chancellor’s meeting with all the lenders. I want those words on the record. We have worked extremely hard to help families up and down this country. Let us now go that extra mile for the cohort of people who are affected by the mortgage prisoners problem. They are hurting more than most people at the moment, because of their particular circumstances.

10:02

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

It is a pleasure to speak under your chairship, Mr Robertson. I thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) for securing the debate, and for his powerful opening speech on the issues faced by mortgage prisoners.

I also thank my constituent Mr Masood, who is a mortgage prisoner and who brought this issue to my attention five years ago. That led to the founding of the all-party parliamentary group on mortgage prisoners. He is one example of someone affected by the issue, and I know that other Members will have similar constituents. Their experiences will be reflected in those of many in the UK Mortgage Prisoners Facebook group—people whose families have paid the price for the situation facing mortgage prisoners. They have made huge sacrifices of their family income and their health just to try to stay in their home, a battle that seems to get harder and harder.

This debate is about mortgage prisoners, but it comes in the context of a much wider difficulty facing mortgage holders across the country as a result of the challenges in the economy, and the mismanagement of our economy over 13 years of cumulative failure and reduced resilience. That was certainly compounded by the mini-Budget last September, which saw the cost of borrowing rocket for Government, local government and households. My constituents are looking at a £4,000-plus increase in their mortgage payments this year on average.

I thank the Minister for meeting me, people from the Mortgage Prisoners Facebook group, and colleagues from the all-party parliamentary group relatively recently. That was important. We were discussing the LSE report, which Ministers have written to me about. I have concerns about the gaps in the letter I received on 13 June. Martin Lewis described mortgage prisoners as

“the forgotten victims of the financial crash”.

I am co-chair of the all-party parliamentary group, and we have heard from many mortgage prisoners about the sheer desperation of their situation, the harm caused by high interest rates, and the Government’s ongoing policy failures. I am concerned that Government and FCA policy are directly contributing to ongoing harm to mortgage prisoners.

When the Government sold the Northern Rock and Bradford & Bingley mortgages, they could have sold them to active lenders that would have offered mortgage prisoners new deals. UK Asset Resolution, however, told Lord McFall, the former Labour Chair of the Treasury Committee, that selling those loans would result in customers being offered new deals, extra lending and fixed rates. Whether or not that was in writing—I believe it should have been—that was the understanding when mortgages were sold on to Cerberus Capital Management and others. The requirement was not written into the contract when the loans were sold, and the vulture fund Cerberus, which bought the loans, refuses to offer customers new deals, extra lending and fixed rates.

The Government have sold the mortgages of mortgage prisoners to vulture funds and inactive lenders, which have exploited mortgage prisoners through high interest rates. FCA rules meant that for years, mortgage prisoners were told that they could not afford to pay less. That was not true. Despite having regulatory oversight of many of those funds, the FCA has refused to intervene and ensure that mortgage prisoners are treated fairly. The FCA allows banks to exploit mortgage prisoners by holding them in separately authorised subsidiaries and keeping them on higher rates.

The Co-operative Banking Group exploits mortgage prisoners in a subsidiary called Mortgage Agency Services Number Five Ltd. Barclays holds mortgage prisoners in its Kensington Mortgages subsidiary, and is pushing for repossession from mortgage prisoners, such as Gregston Clarke, a delivery driver from south London. Both the chief executive officer of Barclays and the FCA know all about that case, but nothing is being done to help.

It is clear that the FCA and Government interventions to date have not worked. I reference that because the Minister speaks about the modified affordability assessment in his letter of 13 June. In April 2021, when the Government rejected amendments, supported in the other place, that would have provided help for mortgage prisoners, they commissioned the FCA to review data on the impact of reforms designed to remove barriers by introducing a new voluntary modified affordability assessment test that lenders could apply. The APPG set up a solutions working group to try to make that new test work as well as possible, but it simply was not attracting the support needed from the market. We worked to ensure that there was an effective communication strategy, and to challenge the FCA on how it was taking that forward.

The FCA’s review confirmed that interventions have had only a tiny impact so far. Only 2,200 of the almost 200,000 mortgage prisoners have been able to switch. Lenders had limited appetite for offering options to switch using the modified affordability test, and only 200 borrowers have been directly helped to switch as a result of the changes. The FCA continues to claim that many mortgage prisoners should be able to switch, but it has not done nearly enough to understand why so many are still stuck. The turmoil in the mortgage market following the mini-Budget made things worse and removed some of the escape routes that could still have been available.

Immediate action is vital, as the situation for mortgage prisoners is getting worse every day. The APPG has highlighted over several years that there is no way for them to gain any certainty over their mortgage payments. The firms that owned and administered the mortgages, which are inactive lenders, have refused to offer mortgage prisoners fixed rates.

The Bank of England has now increased the base rate 13 consecutive times since December 2021. The SVR for Northern Rock was originally around 2% above the base rate. Now SVRs charged to mortgage prisoners are 4% above the base rate, or even higher. The standard variable rate charged by Landmark Mortgages is currently 8.64%, and it will go up to closer to 9% following the interest rate rise last week. Other mortgage prisoners are paying rates of 10% or 12%, which is unacceptable and utterly crippling. Lenders are taking advantage of trapped customers, but the FCA and the Government do not seem to be willing to do anything for those who are being hit harder than other mortgage holders because of the peculiar circumstances in which they are trapped.

I pay tribute to Rachel Neale, Jill and other volunteers in the UK Mortgage Prisoners Facebook group, who witness the harm being done to mortgage prisoners every day. These prisoners may be families who are suffering, unable to heat their homes. They may be cancer patients enduring very miserable final years. The volunteers witness their sheer desperation. They themselves are mortgage prisoners who may suffer from ill health, and they also worry about how they will make payments on their homes. They are on the frontline, and they are expected to support mortgage prisoners without any support to do so, all in their own time as volunteers. They witness people’s desperation as they face repossession caused by years of being exploited by inactive lenders. Some of those people have committed suicide, and others talk about committing suicide. It is particularly worrying that there is nothing to stop the mortgage prisoner problem getting worse. I pay tribute to those who are sitting in the Gallery, and I thank them for being here.

Anyone can find their mortgages sold on without their consent to an inactive lender, which could trap them on an SVR. The APPG has put forward proposals to cap standard variable rates for inactive lenders and require them to offer mortgage prisoners fixed rates. Those interventions would not affect the wider active market; they would be targeted at that particular set of mortgage prisoners because of their circumstances.

Martin Lewis has supported and co-funded research by LSE, which launched its report on 1 March at an event hosted by the all-party parliamentary group. At the launch, Martin Lewis said:

“People have been left in financial, physical and mental misery, exacerbated by the pandemic and cost of living crisis ripping through their already dire situations. When we put solutions to the Treasury in the past, it said it wanted to look at them, but couldn’t as they weren’t costed. Now, having fought tooth and nail to get some of the data needed from official institutions, it is costed. The Government has a moral and financial responsibility to mitigate some of the damage done.”

Almost four months later, the Government have yet to provide a response to the recommendations in the LSE report. Every month of delay causes more harm to mortgage prisoners.

I want to mention the Chancellor’s mortgage summit and the new mortgage charter, which was announced after the summit. It is important to note that lenders such as Landmark Mortgages, Heliodor Mortgages and Engaged Credit were not invited to the summit and—unless the Minister wants to correct me on this—have not signed up to the proposals that were discussed. We wrote to the Minister about the issue and asked for them to be invited to a meeting with the Chancellor. The new charter is voluntary, and there is still significant discretion for lenders. It is a far cry from the help now offered to all mortgage holders that was outlined last week by the shadow Chancellor, my right hon. Friend the Member for Leeds West (Rachel Reeves).

As the APPG has pointed out, large loopholes remain in the FCA guidance. Although it includes a lot of action that lenders may take, such as extending terms, switching rates and switching to interest-only mortgages, it does not require any help to be offered. Lenders such as Landmark Mortgages can continue to trap people on high standard variable rates and offer no help. There is nothing for those coming to the end of their interest-only mortgage term and facing repossession.

The FCA interventions on mortgage prisoners, to which the Government continue to refer in their correspondence and debates, have not reduced the detriment being caused, and the Chancellor’s mortgage summit provided no help for mortgage prisoners facing soaring SVRs. Mortgage prisoners are suffering hugely. It is an injustice, it is a scandal and it is getting worse for them every month. We need urgent action so that they are treated fairly and offered fixed rates. We need the Government to respond to the LSE report, to take responsibility and to work to deliver solutions that ensure fair treatment for all mortgage prisoners.

10:17

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

It is a pleasure to see you in the Chair, Mr Robertson. I congratulate my good friend and comrade, my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes), on securing the debate and on giving an excellent outline of the position of so many people who are caught up in this scandal. I compliment the hon. Members for North Norfolk (Duncan Baker) and for Feltham and Heston (Seema Malhotra) on their excellent speeches, too.

As others have said, mortgage prisoners are people who cannot switch mortgages to a better deal, even if they are up to date with their payments. It is estimated that up to 40,000 people in Scotland are currently in the category of mortgage prisoners. Most mortgage prisoners have a mortgage in a closed book of an inactive firm, which means that the mortgage is held with a lender that can no longer make mortgage contracts because they are not authorised to do so. At the same time, regulators and lenders are imposing more stringent criteria on borrowing to help to prevent another financial crash, and many people are unable to meet the new conditions. As a result, they are unable to move to other deals, even if they would pay less by doing so.

Stakeholders including Martin Lewis and the UK Mortgage Prisoners action group have consistently criticised the Government for not taking action to help mortgage prisoners. Earlier this year, a report produced by the London School of Economics and funded by Martin Lewis said that the UK Government had made a surplus of £2.4 billion from the sale of mortgage books. It offered costed proposals that it argued would meet Government criteria for helping to solve the problem.

As we know, there have been previous parliamentary debates on the issue. In 2021, the Lords agreed an amendment to the Financial Services and Markets Bill that the Commons voted against during ping-pong. The Government argued that it would be an unacceptable and unfair intervention in the mortgage market; as a result, the Lords agreed to remove the amendment. The chief executive of the FCA told the Treasury Committee in May 2021 that further reforms to help to resolve the situation were up to Parliament. In March 2023, Lord Sharkey introduced an amendment to the Financial Services and Markets Bill that was identical to the one passed in 2021, but he agreed to withdraw it when the Government promised to meet stakeholders to discuss the proposals in the LSE report. I hope the Minister will update the House on where those discussions are.

It is abhorrent that people are at risk of losing their homes as a result of being mis-sold their mortgages prior to the financial crash. Homeowners across the UK are being hit by soaring mortgage rates, but mortgage prisoners are being hit even harder.

[Martin Docherty-Hughes]

My opening speech explained why we got here. Does my hon. Friend agree that an addiction to a neo-liberal economic model is to blame for the treatment of mortgage prisoners?

[Chris Stephens]

I agree. There is also a poverty premium that we need to discuss, which I will come to shortly.

As Rachel Neale from the UK Mortgage Prisoners campaign group has noted, their interest rates have gone from 4.5% all the way up to 9%, 9.5%, 10% and above. A number of these homeowners have been trapped—

[Seema Malhotra]

Rachel Neale is present. I thank her for coming along today.

[Chris Stephens]

I am grateful that Rachel Neale and others who are caught up in this situation and who are in the action group are here in the Gallery today. I hope they looked forward to this debate, and I hope that the Minister will be able to reassure them and give them solutions, as a result of the debate secured by my hon. Friend the Member for West Dunbartonshire.

To put the figures into perspective, someone with an interest-only loan of £120,000 managed by Landmark Mortgages would have seen their payments shoot up by £5,100 a year even before the latest interest rate rise, which was announced last week. This is one of the starkest examples of the poverty premium that I have referred to in answering my hon. Friend the Member for West Dunbartonshire. People who are unable to meet affordability criteria pay way over the odds for something for which people in better financial positions are charged much less. It is incredibly unfair that these individuals are paying the price for widespread irresponsible lending prior to 2008.

UK Mortgage Prisoners have highlighted the dire impact that being a mortgage prisoner has on people’s mental health. I will quote Rachel Neale again:

“We have had people openly put on the [Facebook] group that they want to commit suicide if this rate rise happens because they have nowhere to go. It’s devastating—families are in impoverished situations, they’re facing homelessness.”

That is the seriousness of the situation.

In 2020, UK Mortgage Prisoners carried out a survey among mortgage prisoners and found that 3% had contemplated suicide as a result of their situation. It is not unreasonable to assume that that already high figure will likely have increased during the current crisis.

The UK Government must finally take steps to support mortgage prisoners and enable them to re-mortgage with active lenders. The London School of Economics report on mortgage prisoners includes indicative costings, as requested by the Government. The report sets out a range of solutions for helping mortgage prisoners to be able to re-mortgage with active lenders, including free comprehensive financial advice for all mortgage prisoners, which is required for any borrower who might go on to access other solutions; interest-free equity loans to clear the unsecured element of Northern Rock’s “Together” loans; Government equity loans that are interest-free for the first five years on the model of help to buy; and a fall-back option of a Government guarantee for active lenders to offer prisoners new mortgages.

It is estimated that those solutions could cost between £50 million and £348 million over 10 years, depending on take-up. While the overall outlay would be between £370 million to £2.7 billion, that is reduced to £50 million to £347 million net as the Government would hold some equity loans themselves.

The Government have a moral duty to act to support mortgage prisoners, because being in that position has a devastating impact on individuals, and because the UK Government made a surplus of £2.4 billion from the sale of the mortgage books, according to the London School of Economics report. It is an indictment of the UK Government that they have left it to an individual campaigner, Martin Lewis, to fund the study, despite being fully aware of the utter misery caused by the situation facing financial prisoners. Now that campaigners in the LSE have done the hard work and presented the UK Government with fully costed plans that meet their criteria, the very least they could do is to take the steps needed to bring those plans into action.

I will close with a quote from Rachel Neale from the group:

“The severe harm already endured for over a decade, compounded now by 10 consecutive rate rises, means time is not a currency mortgage prisoners have. The proposed solutions need to be considered in detail, and urgent action is required now before more homes and lives are lost.”

I look forward to the Minister’s response to that contribution.

10:25

[James Murray (Ealing North) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Robertson.

As we have heard, this debate on mortgage prisoners takes place in the context of wider concerns about mortgages, as mortgage payers are being hit by increases in interest rates. People who have done the right thing by saving for a deposit and then buying a home now face their payments going up by hundreds of pounds a month through no fault of their own. The interest rate rises are affecting millions of families with mortgages, both those with a variable rate deal who are impacted month on month and those with a fixed-rate deal that has recently expired or is about to do so. The impact of the rises is being felt beyond mortgage payers and their families, as private renters are also often suffering an increase to their rent as a knock-on impact of higher interest rates.

Today’s debate focuses on a particular group of mortgage payers: mortgage prisoners, who face the impact of the recent increases in interest rates on top of the historic uncompetitive rates of the deal they are on. We all know how much fear and hardship rising mortgage payments can cause, so I commend the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) for securing the debate. I also commend the work of Rachel Neale and other campaigners on this issue. I listened very carefully to the hon. Gentleman as he set out his points and talked about his constituent Chris and his family. I welcome the contributions of other Members, including the hon. Member for North Norfolk (Duncan Baker) and my hon. Friend the Member for Feltham and Heston (Seema Malhotra), who mentioned her constituent Mr Masood. They set out much of the detail of the situation facing mortgage prisoners.

As we heard, there are around 200,000 mortgage prisoners in the UK. That is the number estimated by Money Saving Expert, and it aligns broadly with the calculation by the Financial Conduct Authority of around 195,000 mortgage holders in closed books in 2021. Mortgage prisoners face being hit by the same interest rate rise as other mortgage payers, but without even having had the option to move to a cheaper rate deal in the past. We know how much stress, anxiety and hardship soaring mortgage payments cause to so many people across the country. The debate has given us a chance to focus on how particularly acute that is for mortgage prisoners who are already stuck on an uncompetitive deal. I very much look forward to hearing the Minister’s response to the points raised by so many Members about mortgage prisoners.

I would also like to take this opportunity, briefly, to once again urge the Treasury to follow through on the broader plan we set out in recent days to help mortgage holders through the difficult times that so many are facing. Action for all mortgage payers is desperately needed, as banks are withdrawing mortgage deals and the average household is facing a hike of almost £240 a month on their mortgage. Across the UK, 13 years of economic failure has left us exposed. We have the highest inflation in the G7, and UK households are paying almost £100 a month more in mortgage payments than those in other European countries. Millions of households need help now, so it is deeply frustrating that the Government are refusing to make measures to help households mandatory.

[Martin Docherty-Hughes]

I am going to challenge the shadow Minister on some of the points I made earlier. Do his Front Benchers agree that we need a moratorium on evictions and a cap on standard variable rates? Will he pledge to support a cross-party vehicle for those on closed books to pivot back into the mainstream market—yes or no?

[James Murray]

I thank the hon. Gentleman for setting out those points, and I add my voice to the call on the Minister to set out the Government’s position. We are pushing for a wider response to help mortgage holders across the piece, but the Government are in a position to respond to the hon. Gentleman’s points.

I want to use this opportunity to talk briefly about the wider impact of the mortgage rate increases on mortgage holders across the market. The plan that we set out in recent days would require lenders to allow borrowers to switch to interest-only mortgage payments and lengthen the term of their mortgage period, reverse support measures when the borrower requests, and put in place more protection for mortgage holders from repossession proceedings. We would instruct the FCA to ensure that mortgage holders’ credit scores are not affected.

I also want to focus briefly on renters, who need to be part of the conversation about mortgage holders. They are being impacted by the increase in mortgage rates, and the Chancellor did not mention them on Monday. Will the Minister take this opportunity to refer to them?

The rise in interest rates as a result of the UK’s being particularly exposed to inflation will see us paying more on our mortgages than our European neighbours. That undermines the fundamental security that families across the UK need. We therefore urge the Government to follow our plan so that people across the UK are protected. I look forward to the Minister’s response to the points we have made about mortgage prisoners.

10:31

[The Economic Secretary to the Treasury (Andrew Griffith)]

It is a pleasure to see you in the Chair, Mr Robertson. I congratulate the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) on securing the debate. I thank all Members for their contributions, including my hon. Friends the Members for North Norfolk (Duncan Baker) and for Kettering (Mr Hollobone) and the hon. Member for Feltham and Heston (Seema Malhotra), whose chairwomanship of the all-party parliamentary group on mortgage prisoners does so much to increase the standing of Parliament.

Our primary role, as we represent our constituents, is to use our voice to ensure that nobody feels that they are being forgotten. Today’s debate is proof of that. There are no easy answers, but this is Parliament at its finest, as it uses its powers to compel Ministers to come and account for themselves. I am grateful for the work of Rachel Neale and others in the Public Gallery who are continuing with this campaign.

I am humble about the potential failings of Government and regulators. It is not my role to sit here and mouth platitudes. I am not going to say that everyone always gets it right, and I cannot offer false hope. There is a lesson for us all in what we saw with the Horizon scandal, involving postmasters: every human process is fallible. As Minister, I will continue to keep an open and inquiring mind on such issues.

[Martin Docherty-Hughes]

I will make the same points that I made to the shadow Minister. In the interests of openness, will the Minister consider at some point a moratorium on evictions and a cap on the standard variable rate? Will he pledge to support the creation of a cross-party vehicle to enable closed books to pivot back into the mainstream market?

[Andrew Griffith]

I was just starting, but I will try to address the points that Members have made in the debate, including those made by the hon. Gentleman.

The Government and I recognise the anxiety that people in general have about mortgages, and we will use the tools at our disposal to limit the rise in rates. I will leave the general points and address the specifics about what we are debating today. We spent a lot of parliamentary time yesterday debating the new mortgage charter, but this is clearly a different debate—about those who have been in this situation for a long time, such as the hon. Gentleman’s constituent Chris and the constituents in Feltham and Heston and North Norfolk.

[Seema Malhotra]

Before the Minister moves on to the specifics, I want to make a general point. I thank him for his words about the work of the all-party parliamentary group and the UK Mortgage Prisoners group. We want to ensure that we get a solution—this is all about getting a solution to a challenge that has been intractable. Our strong belief is that more can be done, and it will take the Government to step forward and be bold about getting a solution, working with the regulator, which also needs to step up to the plate.

[Andrew Griffith]

I thank the hon. Lady for her intervention. I have met her and campaigners previously, and I am happy to undertake to continue to do so. The best way to find solutions is by working together. I would caution that everything I have seen so far tells me that there is no one-size-fits-all solution. There are a very large number of categories. There is a temptation to aggregate to the largest possible number, but the FCA’s analysis slices it down into more detail and recognises that there are varied circumstances in terms of why people have reached the position they have. I would love to hear more from the hon. Member for West Dunbartonshire about his constituent Chris’s circumstances. He told us that the mortgage was taken out in 2003, which was well before the change in Northern Rock post-2008. By 2007, it had already moved into an interest-only mortgage.

I am a data-led Minister, and as we unpick the data we often find co-mingled in these issues, understandably, the human stories of people who are vulnerable, have fallen on hard times and have been affected by the personal tragedies that all of us as Members hear in our constituency surgeries every week. But those are, to some degree, disconnected from their particular choice of mortgage and are circumstances that affect the wider taxpayer population.

[Martin Docherty-Hughes]

I need to come back on that point. The only tragedy here is that my constituent and his wife will lose their home in 2029 if this Government and any future Government do not get their finger out.

[Andrew Griffith]

I hear the hon. Gentleman. As I say, one of the ways to explore solutions is, I would counsel, to look at the individual circumstances and see what remedies, if any, there are, based on particular cohorts.

[Seema Malhotra]

Will the Minister give way?

[Andrew Griffith]

I will, and then I should make some progress.

[Seema Malhotra]

I thank the Minister for giving way again. I want to make two points. First, it is important to recognise, as the APPG has, that there will need to be longer-term solutions, but there also need to be short-term measures to deal with the situation specifically for mortgage prisoners among other mortgage holders.

Secondly, it is important not to characterise mortgage prisoners as people who have fallen on hard times. These are nurses, teachers and people in all professions. It is the circumstances of the mortgages and how they have been sold on that has been the issue. They have done nothing wrong, and they have not fallen on hard times. This is about the lack of support and protection of the terms on which they bought those mortgages, which were then taken away when the mortgages were sold on.

[Andrew Griffith]

That is fully understood. This is not about any attribution of fault. It is about looking at what the FCA found and the LSE report, which I have read and studied, did not disagree with: that there are a number of different cohorts within this broader category. As we seek solutions, sometimes we might find more illustration by looking at individual fact patterns. The hon. Lady mentioned the modified affordability assessment, which was one attempt to move forward. She observed, rightly, that it helped a relatively limited number of people, and we should try to learn from that. There was an inertia among some, and many mortgage prisoners were contacted, but many fewer engaged in that process.

The Government have consistently committed ourselves, and I am committed, to looking for practical and proportionate options where we can deliver genuine benefits for groups of borrowers, and we are committed to looking at where such interventions would be fair. It is the role of Government to try to ensure fairness and parity across different groups in society, although—while I hear what has been said about the circumstances people are in—we cannot simply solve the problem if somebody is, for example, on an interest-only mortgage but there is no plan in place to repay the principal. That is not confined simply to borrowers on inactive mortgage books, as, sadly, it happens across the market, but we want to ensure that there is the maximum number of options to switch and that all those who might want to switch are aware of the options. There is an awareness issue, as well as the specific problems that people face in the switching process.

Let me address the points raised by the hon. Member for West Dunbartonshire. We heard about the idea of a cap on the standard variable rate for mortgage prisoners. I do not want to repeat all the arguments at length, but that would be a one-size-fits-all solution. It is not, in the view of the Government, appropriate to do that, and I do not want to create a false expectation.

On a moratorium on evictions, there are already well developed pre-action protocols. The remit of the Financial Ombudsman Service does apply, with other remedies behind that. The fact that inactive lenders are not regulated in the same way as active lenders by the FCA does not in any way mean that the remedies available through the FOS are not available. I am happy to work with the FOS to ensure that that point is understood, and to learn from it the data that it has, such as the number of people who have petitioned and sought its support on the issue. Perhaps in some cases that might offer a potential remedy.

Even the LSE’s earlier report of November 2022 argued against the introduction of a standard variable cap, for some of the reasons that we have talked about. The Government have to be evidence-based. The LSE report of March 2023 did talk about free, comprehensive financial advice. Again, that reflects the bespoke nature of some of the problems, and potentially some of the routes forward for individuals. The Government provide significant independent financial advice that is free at the point of use through the Money and Pensions Service. The overall budget for that is £93 million.

I am interested in hearing, perhaps through the all-party parliamentary group, mortgage prisoners’ experience of accessing that financial advice. That was the No. 1 recommendation of the LSE, and that experience could shed more light and data on the subject. I am happy to explore that with hon. Members and, if necessary, convene a meeting with the Money and Pensions Service, or with individualised debt advice charities, to see how we could try to scale that solution.

[Seema Malhotra]

rose—

[Andrew Griffith]

The hon. Lady is trying to intervene.

[Seema Malhotra]

Very briefly. We would be happy to share that experience and to have the voice of the mortgage prisoners group heard. There is a slight concern that this is seen as the problem of the mortgage prisoners. They are very aware of their situation, and they had sought all sorts of advice. It would be helpful to share that experience and the work we have done with the FOS, which might be constructive with respect to how we move forward.

[Andrew Griffith]

I thank the hon. Lady for that constructive intervention. Again, I am committed to working with all comers as we try to find solutions that will help to move the situation forward. I understand the distress that people find themselves in. Whatever the situation was before, I understand that in an environment of rising rates people will feel the effects much more acutely, so I commit to work on that.

I want to fully address all the questions asked by the hon. Member for West Dunbartonshire. We have talked about the moratorium on evictions, and the existing legal framework applies in that space. A global cap on the standard variable rate is not the right or appropriate answer. In terms of working on a specific vehicle for those in closed books, again, I would rather work with the data and look at individual cohorts. As hon. Members have observed, a significant number of the so-called mortgage prisoners are now approaching the end, the maturity—the point at which the question is not necessarily about switching but about how to redeem or repay the capital or look at alternatives at the end of the process. That is one example of why a simple, single-point vehicle would not be the right answer.

We will continue to work with everybody who has expertise in this space, including those who have done work as part of the LSE report. We have to reconcile that duty with others who face similar circumstances, but perhaps are not in this particular category.

I have not responded to some of the more party political points, but I want to make sure that people feel the debate has been constructive and that they are being listened to. We will continue the dialogue and engagement to try to bring forward solutions where we can. We need to work with industry and the Financial Conduct Authority, which is the regulator. I have mentioned the potential role for the Money and Pensions Service. We will continue to try to find solutions that would defuse some of the deleterious impact on people and get more people the ability to switch. No one has ever been explicitly prohibited from switching, but I understand that one of the unintended consequences of regulation has been that in some cases people have been prevented from shopping around in the market, as other constituents can.

Finally, from a broader economy perspective, we will continue to do everything we can to bear down on inflation and interest rates, and we hope to get as quickly as possible back to an environment where rates are not rising. I thank the hon. Member for West Dunbartonshire for securing this debate today.

10:47

[Martin Docherty-Hughes]

I thank all Members here today for participating, and I thank the Mortgage Prisoners action group—some of its members are in the Public Gallery. Most importantly, I thank my constituent Chris. I commit to him, his family and so many other mortgage prisoners to continuing to campaign for them and their demand for justice. I leave the last word to the Mortgage Prisoners action group to set the record straight, given some of the points that have just been made:

“From research within the UK Mortgage Prisoners Group of 4,200 members less than 10 have benefited from the modified affordability criteria introduced in November 2019. It has, by all measures, been a failure. The Money and Pensions Service, who were introduced as the organisation for mortgage prisoners to go to for advice and clarification about being a ‘mortgage prisoner’ have in recent communications revealed that out of 445 client calls, 66% did not fit the criteria to access the better deals…and they are aware of only 36 people who have successfully remortgaged.”

In the group’s words,

“From this failed attempt at a market led intervention it is clear it is time for the Government to stop pretending that the markets can offer an adequate solution for mortgage prisoners.”

I hope that the Government are listening.

Question put and agreed to.

Resolved,

That this House has considered mortgage prisoners.

10:49

Sitting suspended.

Rosebank Oilfield: Environmental Impacts

Wednesday 28th June 2023 Westminster Hall

[Relevant documents: Fourth Report of the Environmental Audit Committee, Accelerating the transition from fossil fuels and securing energy supplies, HC 109, and the Government response, HC 1221.]

11:00

[Mr Laurence Robertson (in the Chair)]

I will call Caroline Lucas to move the motion and then call the Minister to respond. As is the convention for 30-minute debates, there will not be an opportunity for the Member in charge to wind up at the end.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I beg to move,

That this House has considered the environmental impacts of Rosebank oilfield.

It is a pleasure to serve under you, Mr Robertson, and to open this debate on the UK’s largest undeveloped oilfield. I want to put this debate firmly in the context of the escalating climate emergency. Quite simply, approving the Rosebank oilfield would be a disaster for the climate. At nearly 500 million barrels of oil and gas, the development is enormous. It is triple the size of neighbouring Cambo, which drew nationwide protests back in 2021. If it were burned, its contents would produce over 200 million tonnes of carbon dioxide. That is more than the combined annual CO₂ emissions of all 28 low-income countries in the world, which together are home to 700 million people. Developing Rosebank would be an act of climate vandalism and would risk pushing us past safe climate limits.

In his reply, the Minister may seek to absolve himself of responsibility by saying, as he did in my previous debate on fossil fuels and the cost of living, that he is

“confident that our approach is compatible with the journey to net zero.”—[Official Report, 11 January 2023; Vol. 725, c. 248WH.]

The Climate Change Committee has now confirmed once and for all that that narrative is false. Its damning progress report, which was published just this morning, is clear:

“Expansion of fossil fuel production is not in line with Net Zero.”

Indeed, it goes on to spell out that while the UK

“will continue to need some oil and gas until it reaches Net Zero…this does not in itself justify the development of new North Sea fields.”

I hope that we can therefore now put to bed the Government’s disingenuous arguments and see them for what they are: a last-ditch, desperate attempt to justify propping up the fossil fuel industry.

If the Minister needs any more evidence to persuade him, I am happy to oblige. First, Rosebank’s emissions would blow the allowance in the UK’s carbon budgets for oil and gas production, exceeding the CCC’s recommendation in the sixth carbon budget by 17%. That is presumably why Equinor is reportedly looking at sourcing renewable energy from the Viking windfarm on Shetland to electrify Rosebank’s operations—but that is clean, cheap energy that should be used to power hundreds of thousands of homes and businesses, not an enormous oilfield. Developing Rosebank would actively reduce the UK’s energy security.

[Richard Foord (Tiverton and Honiton) (LD)]

On the point about the use of renewable electricity for the extraction of oil, does the hon. Lady agree that it is disingenuous for lobby groups to talk about oilfields potentially saving carbon dioxide emissions? Does she also agree that comparing carbon emissions in the extraction of oil in the UK with carbon emissions elsewhere is both a red herring and greenwashing?

[Caroline Lucas]

The hon. Member will not be surprised to hear that I do indeed agree. Unfortunately, an awful lot of greenwashing goes on when it comes to this debate.

Secondly, it is not just the UK that must reach net zero by 2050 if we are to avoid the worst effects of global heating. According to the sixth assessment report by the Intergovernmental Panel on Climate Change, the whole world must be there by 2050 to stay below 1.5°. If we are to act in accordance with the principle of common but differentiated responsibilities—which was, let us remember, a central tenet of the Paris agreement—it is clear that the UK, as one of the first countries to industrialise using fossil fuels, must go much further and faster than many others.

Thirdly, the Government’s so-called climate checkpoint fails to take account of scope 3 emissions. In other words, the checkpoint simply ignores all the emissions that are produced when the oil and gas are actually burned, so it is no safeguard at all.

Finally, although Ministers try to ignore our global climate reality, the truth is that there is already far more coal, oil and gas in existing developments than can be safely burned if we are to have a liveable future. According to the UN report “The Production Gap”, Governments already

“plan to produce more than double the amount of fossil fuels in 2030”

that would be consistent with staying below 1.5°. The International Energy Agency has made it clear that there can be no more oil and gas developments if we are to limit global temperatures to that critical threshold. Global scientists pretty much agree, yet we have a Government who somehow think they know better than hundreds of UK scientists and the vast majority of thousands of global scientists.

[Patrick Grady (Glasgow North) (SNP)]

I thank the hon. Lady for all the leadership she shows on these issues. Is it not also the case that a lot of our constituents are showing the way as well? They have probably communicated to most of us here today the passion they feel, and they understand the need for a just transition. There are ways to meet both our climate goals and our energy requirements without new oil and gas exploration, exactly as she is outlining.

[Caroline Lucas]

The hon. Gentleman is absolutely right. The majority of public opinion is on our side, and everyone from the Women’s Institute to the scientists is saying the same thing.

I want to talk about climate leadership. Approving Rosebank would destroy any last shred of the UK’s climate leadership. The UK’s record was built on the Climate Change Act 2008 and on being the first major economy to enshrine net zero in law, but as the Climate Change Committee’s report makes clear today, it has been decimated by the Government’s approval of the UK’s first coalmine in 30 years, and by the fact that they have issued more than 100 new exploration licences and are now failing to rule out this enormous oilfield. In the words of the CCC, the UK

“has lost its clear global leadership on climate action”.

[Olivia Blake (Sheffield, Hallam) (Lab)]

I thank the hon. Member for securing this valuable and important debate. I will speak freely and say that it is quite absurd that we are debating this issue today—the day after the four-year anniversary of the net zero target becoming law in the UK, and the morning that the CCC has released its scathing progress report to Parliament. The CCC says that its confidence in the UK reaching net zero is “markedly less” than it was a year ago, and that approving new fossil fuel infrastructure is sending mixed messages about the UK’s climate plans. Does the hon. Member agree that this is a depressing conclusion from the CCC that shows a deficit in climate leadership where there should be none?

[Caroline Lucas]

I absolutely agree. In one sense, it is quite exquisite timing to have this debate and this discussion about Rosebank on the very morning of the CCC report, which is not only depressing but frankly damning when it comes to the Government’s lack of action. On leadership, I will quote Lord Deben, the chairman of the Climate Change Committee, who has noted that the Government’s commitment to the ongoing expansion of North sea oil and gas means that they have

“perfectly properly been called hypocrites”.

Let me briefly turn to some of the bogus arguments that Ministers traditionally advance to try to justify the unjustifiable. I have been told time and again in this place that new licences are essential for our economy and for energy security. In reality, nothing could be further from the truth, especially when it comes to Rosebank.

[Richard Burgon (Leeds East) (Lab)]

I congratulate the hon. Member on securing this important debate. Of course Rosebank oilfield should not go ahead, and of course it is an act of climate vandalism for it do so in the context of a climate emergency. Given the bogus arguments we hear from Government Ministers who justify the unjustifiable, is it not the case that oil and gas giants have far too much influence in our politics, and that we cannot solve the climate crisis if our political system and Government are in thrall to the corporate oil and gas interests?

[Caroline Lucas]

To reinforce what the hon. Member said, we know that the president of COP28 is going to be somebody who absolutely comes from that background, so it is not just a question of domestic collusion with oil companies. The big climate meeting happening later this year will be presided over by a president who we know is absolutely involved in the oil industry. We need to get fossil fuels out of politics once and for all.

Rosebank will not improve energy security, because 90% of its reserves are oil, not gas. Like the vast majority of oil from the North sea, it will be put in tankers and exported overseas, because it is not suitable for UK refineries. Let us be really clear: there is no argument around energy security in favour of Rosebank.

Secondly, Rosebank will not bring down our energy bills, because it does not belong to us. Any oil and gas that is sold back to the UK will be sold at global prices. As the then Secretary of State, the right hon. Member for Spelthorne (Kwasi Kwarteng), said in February last year:

“Additional UK production won’t materially affect the wholesale market price.”

Thirdly, Rosebank will not deliver long-term job security. Equinor claims that Rosebank will deliver 1,600 jobs, but the real number is less than a third of that, with the rest being short-term, temporary jobs just during construction. There are far more jobs, as we know, in a green energy future. What we need is a proper, just transition, hand in hand with the unions, for those workers and communities, to enable them to reap the benefits and rewards of those decent green jobs.

Fourthly, Rosebank will not be better for our planet than imports. Stopping Rosebank does not mean that we will import more oil. Let me say it again: the vast majority of oil from Rosebank will be exported. Even if Rosebank’s oil did reach UK refineries, the development plans submitted show that it is likely to be more polluting than the oil and gas produced in Norway, our largest import partner. More oil production means more oil consumption, less oil production means less oil consumption—it is basic economics. What will bring down imports is reducing fossil fuel dependence across our energy system.

As if all that were not evidence enough, Rosebank is also disastrous for our marine environment. As the Minister will know, the pipeline required to transport Rosebank’s tiny gas reserves would cut through the Faroe-Shetland sponge belt marine protected area, a precious and fragile ecosystem that is home to myriad species. How can the Government possibly reconcile this development with their commitment to protect 30% of land and sea by 2030, especially in the context of Equinor’s assessment of potential damage to coral gardens having been questioned by the regulator? The development would lay infrastructure through a vital ocean habitat, and an oil spill from Rosebank would be potentially catastrophic. The UK already has the most fossil fuel developments in nature-protected sites in the whole world. Let us not add yet another.

There are also plenty of economic arguments against Rosebank, since the development would be staggeringly costly to the public purse. In the words of the UN Secretary-General, investing in new fossil fuel infrastructure is

“moral and economic madness”.

It is madness, because if the Secretary of State fails to stop this project going ahead, the British public will carry almost all the costs of developing Rosebank, while the Norwegian owner, Equinor, gets to pocket the profit. To be specific, Equinor would receive more than £3.75 billion in tax breaks, thanks to this Government’s subsidy regime. Will the Minister explain to me in what world it is acceptable to hand billions of public money to a climate-wrecking company that last year raked in record profits of almost £24 billion, let alone in the midst of a cost of living scandal when the NHS is on its knees, mortgage rates are going through the roof and parents cannot afford to feed their children?

[Tommy Sheppard (Edinburgh East) (SNP)]

The hon. Lady is making a compelling argument against licensing new extraction at Rosebank, and one that I agree with. Does it not seem common sense to most people that reliance on oil and gas will not be reduced by drilling for more of it? The ordinary folk of this country can see that. Why does she think the Government are engaged in this crass idiocy of arguing the opposite of common sense?

Would the hon. Lady also reflect on the differences in attitude between the Scottish Government—who have a more critical and hesitant view of new oil exploration in the North sea—and the current UK Government? Would it be better for the decision on the matter to be devolved to the Scottish Government to allow them to make a more considered decision?

[Caroline Lucas]

I broadly agree; I think it probably should be a devolved issue. I certainly think the Scottish Government are doing a much better job, with more progressive policies in the area of oil and gas. The hon. Gentleman would expect me to refer to the fact that there are Greens in coalition with the SNP in the Scottish Government, and I am pleased about the progress they have managed to make in this area.

I want to come to the position of His Majesty’s official Opposition. I am sad to see none of them here in a formal capacity, though I am delighted to see Back Benchers. While I welcome their commitment not to issue new licences if they were to become the next Government, let me be clear that the revelation that they would not revoke Rosebank’s licence is no less than a tacit endorsement of this climate catastrophe. I worry that the official Opposition, in refusing even to consider rescinding that licence, may as well have given the green light to the project.

I was shocked to hear hon. Members from the shadow Front Bench team saying that rescinding an existing licence sends exactly the wrong signal to investors all over the world. Frankly, that is absurd. It conflates projects that are already operating in the North sea with Rosebank, which is an entirely new development from which first oil is not expected until between 2026 and 2028. A final investment decision has not yet been taken, with developers saying that that will come shortly after approval. Investors are therefore still assessing whether to press ahead with Rosebank, so the official Opposition should have made it crystal clear to them that they should not press ahead with it.

While it would get more complicated to cancel Rosebank’s licence if this reckless Government approved it, that does not mean that it would be impossible. I urge Labour to leave no legal stone unturned and no avenue unexplored to overturn this disastrous decision. That could include, for example, passing new legislation strengthening climate and environmental requirements and thus allowing a licence to be reviewed or revoked, following the Dutch example of phasing out coal power.

The risk of potentially being required to pay costs once again reinforces the urgent need for the UK to withdraw from the energy charter treaty, which allows fossil fuel giants essentially to hold British taxpayers to ransom. Calls for that have so far fallen on deaf ears but have been bolstered by the Climate Change Committee today, which has said:

“There is a strong case for the UK to reconsider its membership”.

It was reported last week that Rosebank will be approved by the regulators in the next fortnight, after which the Secretary of State will have to decide whether to intervene or let it pass, giving the decision a de facto green light. Time is ticking for the Government to act. The only question is whether they will do the right thing for people and planet or commit a climate crime. The choice is clear, so I will conclude with a number of crucial questions for the Minister.

Will the Government review their approach to oil and gas licensing in the light of today’s guidance from the Climate Change Committee? If they do not, do they really want to send the signal that they think they know better than hundreds of scientists nationally and thousands globally? Will they finally scrap the investment allowance, which sees the taxpayer pay fossil fuel companies huge amounts of money to pump yet more filthy oil and gas? Will they withdraw from the energy charter treaty, following many other European countries including France and Italy? Crucially, will the Government stop the development of Rosebank, or are they content to be on the wrong side of history?

I hope that when the Minister responds, he will make reference to the Climate Change Committee’s report today. If he has not had time to read it all, I hope he will scroll back on this morning’s “Today” programme and listen to Lord Deben at 8.45 am, where he will hear his fellow Conservative colleague, former Minister and now chair of the independent Climate Change Committee say that there is reduced confidence that targets will be met, that just because past targets have been met there is no guarantee that future ones will be, that only 33% of measures necessary to achieve the targets are actually in place and that, in terms of future targets, the Government

“are in no state…to achieve those ends and it is…not true to say they will”.

Lord Deben also said that

“the Government is relying, for example, on technologies we don’t have. It is not doing the things which we have to do.”

I very much hope the Minister will reflect on those words, as well as my own, and tell us today that the Government will not go ahead with the reckless decision to give a green light to Rosebank.

11:18

[The Minister for Energy Security and Net Zero (Graham Stuart)]

It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing this important debate and on bringing us back into the positions in which we often seem to be in this Chamber.

The hon. Lady made reference to the Climate Change Committee. Lord Deben is coming to the end of a distinguished 10 years as chairman of that committee, which was set up in the Climate Change Act 2008 precisely to challenge Government, critique what we do and encourage further ambitious action. It is in no small part thanks to his leadership and his being waspish— I think his friends would say he was often waspish—from beginning to end that Governments have been challenged and driven to do what they should to deliver on climate. It is thanks to the Climate Change Committee and his leadership that this country has cut its emissions by more than any other major economy in the world since 1990. It is partly thanks to him that we have gone from the risible position, left by the Opposition when they left power in 2010, of generating less than 7% of our electricity from renewables to now generating well over 40%. As recently as 2012, nearly 40% of our electricity came from coal, the most polluting of fossil fuels. Next year, it will be 0%.

The hon. Member for Brighton, Pavilion is fully aware, and I am sure she understands, that I cannot comment on the detail of the application for the proposed Rosebank oil and gas development. Development proposals for oilfields under existing licences, such as Rosebank, are a matter for the regulators—the North Sea Transition Authority and the Offshore Petroleum Regulator for Environment and Decommissioning—following their standard regulatory processes. As such, it would be neither appropriate nor helpful for me to engage in a running commentary on a live application ahead of a final decision being reached by both regulators.

What I can say is that, as is normal for such applications, the regulators submit all proposals for extensive scrutiny. That scrutiny includes a detailed environmental impact assessment process and an extensive consultation. Comment is invited on the proposals from a number of statutory nature conservation bodies, and there is an opportunity for members of the public and non-governmental organisations to engage in the decision-making process. Once both regulators have made their final decision about the Rosebank application, that decision, along with a detailed summary of OPRED’s conclusions on its likely environmental impact, will be published on the OPRED website for all to see and critique.

To move away from the specifics of the Rosebank development, I am proud to say that, unlike those of most other countries, the UK’s climate commitments are set in law. Of course, it was this Conservative Government who not only transformed the parlous state that we inherited from the previous Labour Administration, but set in law that we should move to net zero by 2050—we were the first major economy to do so. The UK is unswerving in its determination to meet its climate commitments, and has one of the most ambitious 2030 targets in the world. Between 1990 and 2021, we cut our emissions by 48% while growing the economy by 65%—we decarbonised faster than any other G7 or major economy. As we rapidly transition our energy systems, we are supporting emerging economies to do the same. We are advocating the phase-out of coal power and ending unabated fossil fuel use.

The reality is very different from the picture painted by the hon. Lady and those who intervened on her. This country, the most decarbonised major economy in the world, is more than 75% dependent on fossil fuels for its energy right now; that is the basis of this civilisation. Our aim is to accelerate the reduction in oil and gas use, but we recognise that they are essential to modern life, and will remain so for many years to come, including in the production of cement, steel, plastics, chemicals, medicines and fertilisers. We are a net importer of oil and gas, and a fast-declining producer, so I ask the hon. Lady not to use words such as “expansion”. By supporting new licences, we are moderating the savage decline in domestic production, and that is the right thing to do.

[Caroline Lucas]

Will the Minister give way?

[Graham Stuart]

I will make a little more progress, and then I will come back to the hon. Lady.

Reducing the decline in domestic production will not increase the use of fossil fuels in the UK. The hon. Lady’s economics seem rather upside down. It is demand that typically drives supply, rather than supply driving demand, although I recognise that there are movements in both directions. Increasing domestic production will avoid the need to substitute British gas with foreign liquified natural gas, which has much higher emission intensity. The effect of the proposal from the hon. Lady and His Majesty’s Opposition would not be that we consume less fossil fuel; it would be that we import more in tankers. There is not the option to have more Norwegian gas. Not producing our own gas would result in generating higher emissions directly. As well as that, to pick up on the economics of this, they say that the proposal will not affect price. There is a global price; it is a global market. Our oil is traded. It goes to refineries and comes back in the form of medicines, plastics and other things that are vital to our modern society. It is an international market and we are net importers. It is important to recognise that there are tens of billions of pounds coming into the Exchequer, especially at the moment with the energy profits levy tax rate at 75%.

We cannot make out that new projects would somehow cost the taxpayer, or be subsidised by the taxpayer. North sea production brings tens of billions of pounds into the UK Exchequer. It makes a material difference to our energy security because we produce it here at home. It also supports hundreds of thousands of jobs, which His Majesty’s Opposition and the Scottish National party have turned their faces against—and for what? Will there be an environmental gain? There will not be. It will not make a difference, by a single barrel of oil, to how much we consume. What it will do is lose hundreds of thousands of jobs, lose tens of billions of pounds for the Exchequer and lead to higher emissions. And it is worth the House recognising this killer point: it will remove the very supply chain that we need for the transition. The Climate Change Committee and every international body looking at this issue say that we need carbon capture, usage and storage, and we need hydrogen. Which companies, capabilities or engineering capacities are going to deliver those? It will be the jobs, people, balance sheets and skills that are vested in the traditional oil and gas companies, all of which are now involved in delivering the transition.

[Tommy Sheppard]

Will the Minister give way?

[Graham Stuart]

I will. Perhaps the hon. Gentleman can explain why Scottish nationalist policies will have a negative effect on the environment and cause the loss of hundreds of thousands of jobs in this country—for what?

[Tommy Sheppard]

With the greatest of respect, what the Minister says does not make sense. If most of the oil and gas coming out of Rosebank will be exported, how does not doing this lead to an increase in imports?

[Graham Stuart]

As I say, we are net importers in a global market. Oil and gas is processed in different places. It goes out and it comes back. As net importers, the alternative to using that gas here is that we will have more tankers coming in. As the hon. Gentleman knows, or certainly should, the upstream emissions attached to that are two and a half times higher than the emissions attached to gas, which Scottish workers are producing from British fields to the benefit of every taxpayer and the energy security of this nation.

[Caroline Lucas]

It is interesting that the only alternative to one set of fossil fuels is another set of fossil fuels. That is exactly what Lord Deben criticised in his report today. If the Government had done what they were meant to do, and actually set out the investment in home insulation schemes and reduced energy demand, we might not be in this position. If they had scaled up much more in the many other technologies that are out there, we would perhaps not be in this position.

I come back to what the CCC said. I expect the Minister to disagree with me, but does he disagree with Lord Deben and the Climate Change Committee? They said:

“Expansion of fossil fuel production is not in line with Net Zero”.

They said that the UK will need “some oil and gas”, but that that does not

“justify the development of new North Sea fields.”

Does the Minister disagree with his colleague?

[Graham Stuart]

As I said, North sea oil and gas production is declining. It will continue to decline with new licences—

[Caroline Lucas]

That was not my question.

[Graham Stuart]

It will not be expanding; it will actually be reducing. Throughout that time, even as we bring down our demand—ahead of nearly all other countries—we will still be net importers of oil and gas. It makes no sense, or only in the parallel universe occupied by the bizarre fringes of politics does it make sense for us to import—[Interruption.] It will not make a difference, by a barrel of oil, to our consumption. However, it will make a difference to the balance sheet, the jobs and the capabilities that we need to do the transition.

The hon. Lady is quite right to challenge me on this country’s past record on insulation—on the parlous state of the housing stock, for instance, and energy efficiency. In 2010, when we came into power, just 14% of homes were decently insulated with an energy performance certificate rating of C or above; in other words, 86% were not. That was the legacy from Labour. By the end of this year, it will be 50%; we have moved from 14% to 50%—

[Mr Laurence Robertson (in the Chair)]

Order. I do not want to bring this very lively debate to a close, but I am afraid I have to.

Motion lapsed (Standing Order No. 10(6)).

11:30

Sitting suspended.

Hong Kong National Security Law Anniversary

Wednesday 28th June 2023 Westminster Hall

[Sir George Howarth in the Chair]

14:30

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

I beg to move,

That this House has considered the anniversary of the Hong Kong National Security Law.

It is a pleasure to serve under your suzerainty, Sir George. I hope that this debate will focus not just on Hong Kong, but on some other abuses that have crept in on a wider front. There is a very good piece in the newspaper today by Benedict Rogers, a man who has lived out in Hong Kong and has fought for the rights of Hong Kong Chinese for many years. What he writes has a bearing on the whole debate:

“On 1 July 1997, the then Prince of Wales—now King Charles III —and the last Governor, Chris Patten—handed Hong Kong over to Chinese sovereignty. They did so on the basis of a promise, enshrined in a treaty, signed by Beijing. That promise was a ‘high degree of autonomy’ for Hong Kong, indeed the protection of Hong Kong’s basic freedoms, the rule of law, human rights and way of life at least for 50 years—until 2047. It was the promise of ‘one country, two systems’, enshrined in the Sino-British Joint Declaration which had been signed by Margaret Thatcher and Zhao Zhiyang, at the initiative of China’s paramount leader Deng Xiaoping, in 1984, and registered at the United Nations.”

That is an important statement, because it puts in context what we are doing today in Westminster Hall. The reality is that we had an agreement that protected the rights of the Hong Kong Chinese. Those rights were different from those of mainland China and were sustained by that agreement.

As we mark the grim third anniversary of the imposition of the national security law in Hong Kong, we have to pause to reflect on our actions in the UK in response to the original treaty and its subsequent trashing by the Chinese Government. We find, 26 years later, that all those promises have been broken. They were enshrined in an international treaty that was lodged at the UN, which obliged China and the UK Government to observe and protect the rights of the citizens of Hong Kong under “one country, two systems”.

The problem is that—although initial concerns were raised, announcements were made and the Government put out a defiant message and said, “This is wrong”—we have kind of stepped back progressively. I am not saying that good actions did not take place early on. The UK Government created the British national overseas scheme, which was generous, and I applaud them for that. It acted as a lifeline for many Hong Kong Chinese and enabled them to come over here, or at least have it in the metaphorical bank in case they needed to come over. Of course, it is worth saying that the Chinese Government do not recognise that scheme and therefore do not recognise any existing rights for the Hong Kong Chinese in Hong Kong who are able to claim BNO status, but it at least gives them a way out should they need it, although many will find it more difficult as time goes on.

My problem with the present position is that, knowing full well that the national security law has been imposed in Hong Kong in contravention of the treaty, which was trashed by that change and the subsequent arrest, incarceration, persecution and torture of those who, once upon a time, campaigned for their legitimate democratic rights—things that we take for granted in the UK—the UK Government now seem to be hedging on upholding their promises to the people of Hong Kong under the Sino-British agreement. My hon. Friend the Minister must forgive me for making this point, but I am going to make it strongly. As one of several parliamentarians—there are two others here—who have been sanctioned by the Chinese Government for raising these issues, I think we have a right to at least try to speak on behalf of those who now find their rights and opportunities stripped away.

The problem is that the UK Government have never sanctioned any of those who were party to the national security law. None of those who governed Hong Kong subsequently has been sanctioned. Yet the US Government have sanctioned 10, I believe, of those responsible at the highest level. I do not understand that. Perhaps the Minister could explain it to me. It may be that I simply lack the intelligence to understand the nuances of Government policy or certain behind-the-scenes discussions—I am prepared to give way a little on that—but the fact is that a nation that had no particular responsibility for Hong Kong and was not a party to the Sino-British agreement has sanctioned 10 responsible people in Hong Kong, yet we have not sanctioned anybody. I hope that the Minister can explain to those of us who are not in the Government exactly why that is.

The figures show a bleak reality. Some 248 arrests have been made under the new law, and 140 individuals are facing charges. Over 1,000 political prisoners, as we would understand them, are in Hong Kong today, which highlights the severe suppression of dissent and the erosion of the basic freedoms that were guaranteed under the Sino-British agreement. The agreement was set to be in place until 2047. I am sorry to keep emphasising that point, but it needs emphasising. Many people think that this was just the normal transition. It was not. China had an obligation to continue with those rights and responsibilities, troubling though they may have been.

The rampant use of pre-trial detention under the national security law—over 100 individuals have been remanded in custody, for an average of nearly two and a half years—the disregard for due process and the prolonged detention without trial continue to raise serious questions about the existence of the rule of law and the protections of human rights in Hong Kong. Although sitting British judges no longer sit on the Court of Appeal in Hong Kong, I am sorry to say that there are many retired British judges who still choose to go to Hong Kong to promote the façade that they can somehow help in this regard.

Interestingly, the American Government circulated a document among US businesses a year and a half ago, I think, that recommended that businesses that were involved with or based in Hong Kong should recognise that the common law would no longer give them the protections that they would otherwise have been afforded in their business and contract relations. Will the Minister tell us exactly what we have advised businesses? Have we circulated any documents to them about whether they should be concerned about the placement of their headquarters in Hong Kong? I will certainly be happy to give way to the Minister if he wishes to make that clear.

[Tim Loughton (East Worthing and Shoreham) (Con)]

I congratulate my right hon. Friend on bringing yet another debate on Chinese human rights abuse to this House. I think the accusations that he has quite rightly made are an underestimate: by my reckoning, the US Government have in fact sanctioned some 11 people—former Chief Executive Carrie Lam, Chief Executive John Lee and nine other Hong Kong officials—for their role in the crackdowns in the city. The Foreign Office has very clearly said that the security law is a clear breach of the joint declaration. At the last count, I think at least 18 journalists have been arrested, numerous free speech media organisations have been closed down, several opposition parties have been driven out of operation and democratically elected places have been reduced to no more than 20% in forthcoming elections. I am sure my right hon. Friend will get on to this, but what have the UK Government actually done to show the Chinese that that oppressive activity has consequences? Nobody has been sanctioned, but what other sanctions have been brought to bear? What are the consequences of what the Chinese are doing?

[Sir Iain Duncan Smith]

I stand corrected. My hon. Friend is quite right: it is 11, which makes it even worse. Foremost among them is the Catholic entrepreneur and—most importantly—journalist Jimmy Lai, who languishes in prison on a trumped-up charge. I will come back to that point, because I have further questions to ask the UK Government, but I hope that the Minister has taken note of my hon. Friend’s comments about the actions of the United States. Our words about the transgressions have remained words; they have not given rise to actions that I would have expected from the UK Government. I am sorry to say that. They are a Government I support, but a Government who at the moment I have to say are in deficit in this area. I want to point out a few more areas where I find our Government in deficit.

What assessment have the Government made of all those figures we have been chucking out, as young political prisoners, three quarters of whom are aged 30 or under, bear the brunt of this oppressive regime? It is deeply troubling that minors face the longest sentences of all, averaging something like 27 months, further exacerbating their plight. What also bothers me is that the Government, having not gone to Hong Kong officially, suddenly sent a Government Minister there a few weeks ago. As I understand it, now that his visits and meetings have been published, Lord Johnson met no democracy campaigners, said nothing officially or publicly about the Sino-British agreement, said nothing at all about the breach of human rights, said nothing at all about those sanctioned, and, to my knowledge, said nothing at all about the plight of the British citizen Jimmy Lai.

I want to stay on that point because, of all the things the Minister could have said, he could have said something about the bad behaviour with regard to a British passport holder and citizen. I want to say it again: Jimmy Lai is a British passport holder and citizen. As much as every one of us sitting in this room today, he has rights. At the front of the passport, it states “without let or hindrance”. What is the worth of the passport that I and everybody else in this room carry, if my Government will not call him a British citizen with rights under international law for consular access? America refers to him as a British citizen and passport holder. The European Union refers to him as a British citizen and passport holder. What country does not refer to him as a British citizen and passport holder publicly? Sadly, that would be my Government—our Government. For some reason, the British Government take it upon themselves to know, beyond any other family member or Jimmy Lai himself, what is good for him. What is good for him is what he wants.

Jimmy Lai did not flee Hong Kong after the trashing of the Sino-British agreement. Why? Because he is a brave man who believed that as long as he stayed, he could be the guarantor of some of the rights that might disappear. He wanted to be the icon who believed in democracy and human rights, so that those who were fearful and fleeing, and worried for their lives and the lives of their family, would look to him and see a brave man standing on the hill saying, “I’m not going anywhere. This is my home.”

A British citizen, a brave man, now languishes in prison on a trumped-up charge that has nothing to do with reality. He faces a second court case later this year, where he will almost certainly be charged under the new security laws for sedition. Jimmy Lai knows, and his family know, that it is unlikely he will ever see the light of day outside that prison. He knew that from the very word go; he made his choices on the basis that he knew that from the very word go. He did not flee.

Surely Jimmy Lai wants us to say that he is a proud British citizen and passport holder. He is not a dual national, by the way. I wish the British Government would stop referring to him as a dual national: it plays into the Chinese Government’s hands, because they declare that they do not recognise dual nationals. He is not a dual national; he is a British passport holder. I want that to be very clear. His family, who I have spoken to and who had to flee to Taiwan, say he wants to be pronounced a British citizen and passport holder. All I ask is that at the end of the debate my hon. Friend the Minister gets up and says, “He is a British citizen and passport holder, and we intend to pursue the Chinese Government publicly for consular rights. He is a political prisoner, and there is no question beyond that.”

I congratulate and applaud my Government on the generous BNO scheme and on extending it. To give credit where credit is due, the Government have done well on that. The trouble is that after everything that has been going on and the failure to recognise even a British passport holder, many BNO passport holders in the UK are now fearful about their own status. We know that many of them have been hunted down in the UK by those terrible Chinese police stations, which are quite illegal but have existed in the UK for an unnecessarily long time. We know that they have been threatened and bullied about their status. They worry about their protections under a BNO scheme, which are far fewer than those of having a British passport and being a British citizen. I would like the Government to consider that our failure to act in that way for Jimmy Lai has consequences for those we would wish to protect in a wider scheme. One need only talk to them to understand their concerns. We need to make those changes and announcements.

On the basis of what my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) said, when will the UK Government put Hong Kong officials, who were responsible in the first place for many of those human rights abuses, under notice that they will be sanctioned? They should have been sanctioned by now. Is there a chance that the British Government are reviewing it? I know what the British Government and the Minister will say: “We never discuss sanctions.” I wish he would say at least that he will take note of what we have said.

For Hongkongers facing the plight of having to risk entering the Chinese consulate for the renewal of their Hong Kong passports, this policy places them in a vulnerable position. They are worried. What alternative procedures will the Government pursue to give those people a greater sense of certainty, such as by providing other things like travel documents or establishing a successful and secure passport renewal process that does not necessitate entering the grounds of a Chinese consulate? I remind everybody that the last person I knew of who entered a Chinese consulate’s grounds was dragged there by the consul general, was beaten up and had his hair torn out. I met him afterwards, and he was traumatised. The Chinese Government did not do anything, and the British Government talked about the law, but he quietly disappeared later on and no apology was made. It was a terrible act. I understand why BNO passport holders here are fearful of what will happen to them if they enter the consulate. The big concern and fear is about whether they will come out again. Will the Government look for other ways for them to establish their legitimacy, other than being forced into this damaging process?

The visit of Liu Jianchao last week also sent a signal to many people who are here under the BNO scheme. It is deeply regrettable that the Government chose, for some reason, to host him. This is a man deeply involved in China’s controversial fox hunt operations, which hunt down Chinese dissidents around the world and seek to get them back to China using techniques that include threatening their families, televising that threat, and eventual torture and arrest on re-arrival. It is an example of China’s disregard for international norms and human rights that it behaves in that way so publicly. By welcoming this individual—there is a photograph of a Minister sitting next to him; given the abuse of international norms and human rights, I am astonished that we would allow a Government Minister to meet him and sit with him—are we not sending a chilling message to everybody else that we place that relationship on a higher plane than people’s human rights and liberties?

[Richard Foord (Tiverton and Honiton) (LD)]

On the point about the Hong Kong national security law having extraterritorial reach, some in the People’s Republic refer to centuries of humiliation, when their forebears made concessions to other imperial powers. Does the right hon. Member think that since the crackdown in 2020 against students in Hong Kong who were simply singing songs and waving flags, it is reasonable to say that the People’s Republic is behaving in a repressive fashion that was typically associated with 19th-century imperial powers?

[Sir Iain Duncan Smith]

These are abuses of human rights and democracy. The hon. Gentleman is right: this is an appalling return to a time we thought had long passed. We now respect people’s human rights, but that is not the case in China, and it is now not the case in Hong Kong. The worst part about the situation in Hong Kong, which he is right to raise, is that we were one of the guarantors, but we seem to be shuffling away from that guarantee. Where other countries have acted on the abuse, we seem to be stepping back. I am concerned about that. I would love to know more about it from the Minister.

[Tim Loughton]

Going back to the visit by Liu Jianchao last week, a photograph was publicly promoted—through Government circles as well—with lots of smiling Chinese officials. I counted at least five parliamentary colleagues in that photo, including a senior Government Minister, sitting alongside a notorious senior Chinese Government official responsible for snatch-and-grab, effectively illegal, rendition. Given that my right hon. Friend and I and five other parliamentarians have been sanctioned by China, and that the Chinese ambassador and other Chinese Government officials are, quite rightly, banned from coming to this place as a result of the good work of the Speaker, does my right hon. Friend not think that no parliamentary colleagues should be seen sitting down with Chinese officials of this calibre and reputation? They should not be doing it, should they?

[Sir Iain Duncan Smith]

My hon. Friend knows very well that I agree completely with him. I was shocked to see that picture. I wrote to the Prime Minister on the Sunday, shortly before Liu Jianchao was due to come over. I also wrote to the Speaker, who was in agreement that the meeting would clearly not take place in the House of Commons or Parliament generally. When I wrote to the Prime Minister, I was told I would get a reply at some point—although the man is gone now, so the reply will come after the event, which is sad, but there we go.

The point is that I did not know at that stage that Liu Jianchao was going to meet any officials; I was told that he was not and that he was going to meet MPs. I then saw the picture the hon. Gentleman referred to, in which a Government Minister is sitting front and centre next to this man, whose reputation is so utterly appalling that it beggars belief that anybody would want to sit next to him, but everyone in that picture is grinning and happy. That our colleagues should then attend is another thing, and I simply say that there should be some solidarity in this place. If people are sanctioned for standing up for their beliefs, we do not want to undermine that by sitting next to these characters. I would therefore like to know what assessment the Government made before the meeting with Liu Jianchao.

After all, this place should be a beacon of freedom. I have the highest respect for the procedures, processes and nature of Government—I served in Government myself for some years—and I understand the difficulties, but there is a particular reason why this individual should not have been allowed to sit next to a Government Minister. When the deputy governor of Xinjiang was going to come over here, I and others went out to the protests with the Uyghurs, because he was part of the design of the terrible system that is now, essentially, genocide against them.

We campaigned outside the Foreign Office, which eventually said that it would not allow an official to see him, although one had been going to. I was happy that it came to its senses and said no. By the way, when people say that British foreign policy cannot persuade anybody any more, it is not true, because every other European country that was going to see him said no as a result. So we have some sway after all; we have some locus in this. I therefore want to ask the Minister what thought was given to this before this man arrived here.

I spoke earlier about Lord Johnson’s visit, and I was astonished to find that the problems or the plight of the people we have spoken about today, who have been attacked, arrested and trashed, were not raised particularly—it was all meetings with business. I can understand it if he meets with business, but meeting with business in Hong Kong is not the same as meeting with business in the United States or the UK, where people have freedom of expression and are covered by human rights and a workable law. That is not the case in Hong Kong, and we cannot detach ourselves from what is going on politically in Hong Kong if we choose to go to Hong Kong to make business arrangements.

As I say, the American Government have already warned their businesses that common law does not protect them in Hong Kong in the way that it would have done under the Sino-British agreement. That is a really important point. English common law is the finest legal system in the world, and it is being adopted by countries all over the world, particularly for business deals. It is straightforward and much easier to operate, and it runs under a system that has been tested through time, and many people welcome that. However, the freedoms and rights in it disappear when they clash with the new law that exists in Hong Kong. That problem did not go away, and things like countering foreign sanctions, and businesses getting trashed as a result of these new laws, do not seem to have been raised either.

However, I want to return to Jimmy Lai. Of all the things I have spoken about today, this man should be in our thoughts. He is a brave democrat and a decent man. He is a journalist. He speaks truth unto power. He was fearless in the way that, when he had to, he attacked the Legislative Council and the decisions it made. He was constant and convinced in the role that he played.

I say to my hon. Friend the Minister that we should take decisive action to uphold the promise of protecting our citizens. I want to know what steps the Government intend to take, not only on many of those who are languishing in jail but, importantly, on Jimmy Lai, because he is iconic. Are we going to say to the Chinese Government, “Enough is enough. There are consequences to your actions. We intend now to tell the world that this man is a British citizen and a British passport holder. We have responsibilities for him, and we intend to claim those under international law. We are not prepared any longer to do things quietly behind the scenes. If you choose to go on down this road, we will sanction all those responsible for the introduction of the new laws and the crackdown, as America has already done”? We should be telling China that that is where we are going. I know that we worry about losing business with China, but sometimes the price of business can be too high, and I think that that is the case here.

All that I want to know is that we recognise a British citizen, we recognise a British passport holder and we treat them the same, no matter where they live or where they are. That is the point of the passport. I carry my passport with pride, but I doubt its provenance now, as a result of our attitude and the attitude of those at the Foreign Office to Jimmy Lai. I ask them simply to examine their conscience and to ask themselves whether, if they had been incarcerated by a foreign Government that had broken an international agreement, they would not want the Government and the Foreign Office to stand up for them in the boldest and bravest ways, as they should?

I have two last points, and I will be brief. I understand that there is a lot of movement at the moment on the National Security Bill, which is providing the Government with some tools—for example, the enhanced tier of the foreign influence register scheme. However, we do not know yet whether China will be included in that enhanced tier. If my hon. Friend the Minister cannot respond to that point now, I ask him to take away the fact that we here in Westminster Hall, and more widely in the House, want China moved into that tier, because it poses a direct and constant threat.

The second thing, which I will finish on, is that an idea may be brewing in the Government that they want to do an energy trade deal with China. If that is the case, they need to rethink. The idea of rewarding China for its bad behaviour and becoming more dependent on an autocratic regime smacks of failed policy. I hope my hon. Friend the Minister will be able to tell me at the end of the debate that there is no such discussion and that no such trade arrangement will be attempted.

In conclusion, this is a sad anniversary. These people, who have been arrested and incarcerated for the freedoms that we take for granted in the United Kingdom, need to be supported. Overall, the best thing we can do to show the Chinese Government that we shall not tolerate this is to say that Jimmy Lai is a British citizen—a British passport holder—and that we demand the rights that come with British citizenship, including consular access. I ask nothing more of my British Government than that they support a British passport holder.

15:00

[Jim Shannon (Strangford) (DUP)]

I congratulate the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) on his continuing energy, enthusiasm and wisdom in highlighting this issue. Today we gather to discuss what has happened in the past three years, and he has outlined that very well and shown what has happened with the implementation of the national security law in Hong Kong.

Immediately after the passage of the National Security Law in 2020, universities fired academics involved in pro-democracy activities, and pro-democracy slogans and songs were banned in schools and universities. Statues and memorials were removed, and pro-democracy newspapers were shut, including Apple Daily, owned by British citizen Jimmy Lai, who currently sits in jail.

The right hon. Member put the case very well for Jimmy Lai, who is a British passport holder. I always carry my passport with me, and the first page says:

“Her Britannic Majesty’s Secretary of State requests and requires in the name of Her Majesty all those whom it may concern to allow the bearer to pass freely without let or hindrance, and to afford the bearer such assistance and protection as may be necessary.”

That is what the right hon. Member is asking for, and that is what I and others are asking for. We cannot understand, with respect, why our Minister and our Government have not grasped that, when it is clear to us what is asked for: the rights that that passport gives me and every other person here.

The Guardian reported that the entire Hong Kong opposition party quit after four of its members were disqualified from serving in office for being, in the words of the Chinese, “unpatriotic”. Those members were standing up for liberty and freedom in a process that they supported, and they were denied that right. In January 2021, 53 Hong Kong democrats and activists were charged under the national security law for participating in an unofficial democratic primary election in 2020. Some 47 of those 53 activists—known as the Hong Kong 47—are currently on trial in Hong Kong, charged under the national security law. It is the largest national security law trial to date, which gives an idea of the ferocity of the Chinese authorities against people who just want liberty.

Hong Kong’s rule of law and judicial system continue to be destroyed under the national security law. There are more than 1,400 political prisoners in Hong Kong, which also holds the highest proportion of female political prisoners in the world. Should we not be concerned about that? I think we are, because we are here today to reiterate these points. Foreign judges, including Lord Reed and Lord Hodge from the UK, have left Hong Kong, because they did not want to legitimise the current Administration, which continues to crush Hong Kong’s most basic civil liberties. As has been said, it is immoral that any British or foreign judge should sit in Hong Kong courts, regardless of how much they are paid. I again urge our Minister and our Government to ensure that no British judge sits on Hong Kong courts and profits from the current turmoil in that international city.

We have previously discussed the case of Jimmy Lai, and right hon. and hon. Members have reiterated it today. He is a British citizen who has been prevented from having his lawyer of choice. Even when it comes to giving a legal opinion, his right has been denied. The percentage of district council seats that are democratically chosen now sits at around 20%. There are clearly issues; I look to the Minister to ascertain how we can play our part in addressing these outrages and these attacks on democracy.

The Hong Kong authorities continue to erode freedom of the press. The Reporters Without Borders world press freedom index for 2023 makes for poor reading. Hong Kong was ranked 140 out of 180 countries. In 2022, it fell nearly 70 places on the previous year, exposing the grave impact of the national security law, which the right hon. Member for Chingford and Woodford Green referred to. Hong Kong is not the global financial hub that the world once knew. According to an Atlantic Council report that assessed the risks in Hong Kong’s business environment, when journalists’ right to report freely is threatened, all forms of reporting, including on the state of financial markets, may be affected. That has clearly had an impact on financial markets. Companies cannot thrive in that type of environment, and they are voting with their feet.

The Atlantic Council also raised concerns about the privacy of corporate data and the intellectual property rights of companies that continue to operate in and from Hong Kong. The influence of the Chinese authorities is detrimentally impacting on those businesses. The Government should do more to warn businesses and businesspeople of the risks they face working and investing in Hong Kong due to the national security law. May I ask the Minister—I am ever mindful that he is not the Minister directly responsible—to respond to that question today?

Prior to the passage of the national security law in June 2020, the former Foreign Secretary, the right hon. Member for Esher and Walton (Dominic Raab), said that the national security law would violate Hong Kong’s one country, two systems principle. After its passage, a statement was made affirming that the China-imposed national security law caused China to break its promise to Hong Kong that it would be able to govern itself and breached China’s international commitments to Britain under the Sino-British joint declaration. Quite clearly, international law has been broken by China as well.

In the Government’s latest six-monthly report on Hong Kong in May 2023, the Foreign Secretary urged Beijing to heed the call in an independent United Nations Human Rights Council report to remove the Beijing-imposed national security law in Hong Kong. What has happened since then? I suspect very little, but the question was posed by the right hon. Member for Chingford and Woodford Green in introducing the debate, and I am posing it too.

In answer to a question about human rights in Hong Kong just last year, Lord Ahmad of Wimbledon said in the other place:

“The Hong Kong authorities’ decision to target leading pro-democracy figures including Cardinal Zen, Margaret Ng, Hui-Po-Keung and Denise Ho under the National Security Law is unacceptable.”

The Chinese authorities seem to have a total disregard for what is happening. Since the passage of the national security law in 2020, the British Government have referred to it as a violation of the Sino-British joint declaration.

I welcome the fact that the British and Canadian Governments have offered generous visa schemes. The Government are to be congratulated on those schemes, which allow Hongkongers to escape from the oppressive consequences of the national security law. When he sums up, will the Minister say how we are working with our allies—Canada, the United States and other countries —to represent the Hongkongers?

While international support is welcome, it is clearly not enough. Hong Kong continues to deteriorate day by day. There is less freedom there today than there was the last time we had a debate—I think about three months, or indeed a year, ago. We must do more to protect the Hongkongers who have moved to the UK and who now face harassment and intimidation by the Chinese Communist party, including through the Confucius Institutes in British universities. I have constituents who are good friends of mine—I have known them for many, many years—who were clearly being tracked and whose activities were being monitored. We asked about that and were told that the information was sent on, and that the police forces—the Police Service of Northern Ireland, in particular—were aware of it, but the fact that it can happen is distressing, both for my constituents and for me as their elected representative.

In conclusion, I ask the Minister to call for the release of British citizen Jimmy Lai, as did the right hon. Member for Chingford and Woodford Green and others. That is one of the key demands of our Minister and our Government from this debate. Jimmy Lai has been behind bars for 910 days. We should continue to put pressure on the Hong Kong Government to immediately repeal the national security law, and we should speak out against legislation in Hong Kong that continues to destroy the rule of law, the judicial system, the free press and the vibrant financial centre that the world once knew. Today, we have a chance to make a plea on behalf of Jimmy Lai and all those who have been detained by the Chinese authorities. In this House, we have a duty to represent them to the fullest of our capabilities.

15:10

[Damian Green (Ashford) (Con)]

It is a pleasure to serve under your chairmanship, Sir George. I congratulate my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) not just on securing a debate on this grim but important anniversary, but on his powerful and compelling speech. He made the case that we in this country, and specifically the Government, should do more than has been done in the past few years to push back against what the Chinese Government are doing, both in Hong Kong under the guise of their national security law and around the world, not least in this country.

I should say that the Government have done some good things: I congratulate them on introducing the BNO visa route for Hong Kong citizens, which was unquestionably a positive development. It provides the opportunity for BNO status holders and their families to live, work and study here in the UK. The figures speak for themselves: we have had more than 160,000 applications since the status was first introduced two and a half years ago. I am afraid that figure shows how essential it was for those who no longer feel that their way of life is safe in Hong Kong.

I am particularly grateful that the scheme was further opened to younger Hong Kong people following a campaign that I worked on with others who are present in the Chamber. As my right hon. Friend said, those born after 1997 are in many ways the most vulnerable to the Chinese Government’s crackdown in Hong Kong, but until the Government agreed to change the law they were ineligible under the original scheme. Those are both positive steps. I do not want to be unremittingly negative, but I must point out that the BNO scheme is no substitute for holding Beijing to account across the board. The Government’s routine answer to questions about Hong Kong is that they will not shirk their responsibilities to Hong Kong people and their commitments under the Sino-British joint declaration, but the supporting evidence that they always bring out is the BNO scheme, and so far nothing else.

We need to be clear that allowing Hongkongers to come to the UK does not hold Beijing to account for breaking international agreements with the UK. I would be grateful if my hon. Friend the Minister said what concrete action has been taken to hold the Chinese Government to account for what the UK Government call an “ongoing breach” of the Sino-British joint declaration, which is supposed to remain in force for another 24 years. Have they, for example, registered any formal objection to joint declaration breaches, as is provided under the Vienna convention on the law of treaties?

I am something of a heretic in that I wince slightly when the House of Commons demands that the British Government and Foreign Office Ministers take a stand and do something about practically every crisis that emerges around the world, for many of which the British Government have no locus to intervene, but in this case we absolutely do. We signed this treaty, so this is genuinely a British Government issue, and not just some kind of emotional attachment to democracy around the world, which we all have. The phrase the Government like to use is “robust pragmatism”. If that means anything, it must mean ensuring that those who break binding international agreements with us are not simply permitted to get away with it.

We have had some discussion already about Hongkongers in the UK. It is worth pointing out that this is the largest peacetime migration to the UK from outside Europe in history. The Uganda lifeboat scheme set up to assist those fleeing Idi Amin reached around 28,000 people. The Hong Kong scheme is already at 160,000. The Ugandan scheme came with a well-crafted integration plan. As recent conflicts between Hongkongers and the mainland Chinese authorities in this country have shown, such as the shocking attack on University of Southampton students earlier this month, full integration of Hong Kong people is not without difficulty.

Can the Minister tell us what efforts are being made to ensure that Hong Kong people feel safe in this country? How do the Government plan to address the issue of Chinese state-sponsored intimidation such as that mentioned earlier, perpetrated by the Chinese consul general in Manchester, on our soil? I am sure the Minister agrees with me that Hong Kong people are entitled to the same rights as the rest of us in the UK and must not feel as if their right to assembly and protest is somehow curtailed due to the Chinese Government’s intimidation techniques and transnational repression.

We must remain vigilant and responsive to the evolving needs of this growing constituency of fellow residents of this country. I hope the Government will continue to engage with BNO holders, the relevant organisation and the experts to develop policies that address their broader challenges, beyond visa provisions. We owe it to these brave individuals to provide them with the necessary support and opportunities to thrive in the UK.

We have had much discussion of the Jimmy Lai case and I know that many Hongkongers, in the wake of that case, feel unsafe when travelling. They fear that the UK, frankly, will not defend them if Beijing attempts to apprehend them in China, Hong Kong or even a third country from which they may be extradited. Again, can the Minister set out the Government’s policy regarding Hong Kong BNO holders when they travel outside this country?

It is also worth the Government considering a discrepancy in our approach to these people. It is not well known that Commonwealth citizens who do not require leave to remain in the UK are eligible to stand for Parliament. In correspondence with Luke de Pulford of the Inter-Parliamentary Alliance on China last year, the former Home Secretary, my right hon. Friend the Member for Witham (Dame Priti Patel) confirmed that that did not extend to Hong Kong people due to a now obsolete rule associated with an annex to the joint declaration. That is in spite of Hong Kong people having been in the same category as those from Commonwealth countries previously for the purposes of immigration law. Many of the 160,000 people are already engaged with political parties in the UK and it feels wrong that they will be excluded from representative politics for another five years. I hope the Minister will agree to look at that.

One last individual case that the Government should consider is that of Andy Li, one of 12 Hongkongers who tried to flee Hong Kong in a boat in August 2020. All were apprehended and taken to Shenzhen prison. We do not know what happened there, but it was sufficiently awful to have persuaded Andy to testify against Jimmy Lai, a man he has never met. Andy has now been transferred to Hong Kong, where he was convicted for collusion with foreign forces. However, he has still not been sentenced, and it seems that the authorities will not do so until he has testified at Jimmy Lai’s trial, underlining the depths to which a once proud legal system has now sunk. Andy Li is a courageous, non-violent Hongkonger whose only crime was to work to defend the promises set out in the joint declaration and Basic Law. He is now in prison precisely because we failed to keep the Chinese Government to their promises.

Some of those sanctioned by the Chinese Government, including my hon. Friend the Member for Isle of Wight (Bob Seely) and Lord Alton of Liverpool, were mentioned in Andy Li’s case file as an example of the foreign forces with which he is supposed to have colluded. It was on that basis that all those figures were warned by the Foreign Office of extradition to China as they are likely seen as criminal under the national security law, which claims universal jurisdiction even over foreign nationals. Again, I hope the Minister will agree with me that this House and the Government cannot stand by while people are imprisoned because of entirely legitimate work with Members of this place and will agree to redouble their efforts to see Andy Li freed.

I appreciate the difficulties that Ministers face in maintaining a position of robust pragmatism, but it is incumbent on them to defend the rule of law and international treaties, and they need to defend that position consistently and over a long period. That would be in the best traditions of the British Government and the British people. We owe it to Hongkongers to maintain the “robust” part of “robust pragmatism” for as long as it takes.

15:21

[Tim Loughton (East Worthing and Shoreham) (Con)]

I was not intending to speak in this debate, but my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) and fellow sanctionee has spurred me on to fill the short gap that we might have in this debate. There is rarely a debate on China in this place that I am not chafing at the bit to participate in. I agree with everything that my right hon. Friends have said and I will not repeat it. Certainly the generosity and necessity of the BNO scheme has shown its worth. I fear that many more than the 160,000 former residents of Hong Kong here already will swell those numbers.

The rule of law, justice, free speech and anything resembling freedom were snuffed out over more than 60 years in Tibet. They have been snuffed out in recent years in Xinjiang and are now being aggressively snuffed out in Hong Kong. The rule of law, as any of us would recognise it, does not exist in China. I want to give two examples. We had a meeting of the Conservative human rights commission at the beginning of this week and heard testimony from two very brave men who have been the victims and fallen foul of—I will not call it the Chinese justice system, because there is no justice—the Chinese legal system.

One of them, Peter Humphrey, is a 67-year-old British citizen from Surrey who had 48 years of experience in China. He did a lot of work in China and was working for GlaxoSmithKline when in July 2013 he and his wife were arrested and imprisoned on charges of illegal information gathering after conducting an investigation for GSK. They spent two years in Chinese prisons during which time Peter developed advanced prostate cancer because medical treatment was deliberately withheld in a bid to coerce a false confession. He was the first prominent member of the foreign business community in China to be imprisoned by the Xi Jinping regime and the case attracted extensive media coverage. He was also the first foreigner to be paraded in a cage on Chinese television in a notorious broadcast of a false and forced TV confession.

In 2019 there was the case of the Tesco Christmas cards, which gained a lot of attention when a six-year-old girl from Tooting opened a box of Christmas cards bought in Tesco to find that one of them had already been filled out. The cards were made in China. On the front the card featured a kitten in a Santa hat. However, inside one of the cards was this message:

“We are foreign prisoners in Shanghai Qingpu prison China. Forced to work against our will. Please help us and notify human rights organization. Use the link to contact Mr Peter Humphrey.”

So Peter was specifically mentioned in that note. It was from a prisoner in the gulag—one of many millions who were being forced into labour and used by companies in China to sell their goods to an unsuspecting Tesco, which, to give it its due, ceased business with the company that provided the goods. The trouble is that it is almost impossible to source where many of these things come from. We know how so many things are made in China and disguised in various component parts.

The second person who we heard testimony from earlier this week was a 42-year-old Romanian citizen, Marius Balo. Many of the people in the room were in tears at the testimonies that the men gave about their experiences at the hands of the Chinese Government. In 2014, Marius was wrongfully arrested, along with all the staff of the Chinese company for which he worked as a part-time employee. The company was accused of contract fraud, which Marius had known absolutely nothing about. It was entirely trumped up. He spent the next two years in a 12 square-metre cage with no way to contact anyone in the outside world, and a further six years in the same Shanghai prison as Peter Humphrey.

This is going on all the time. Those two men have been exceedingly brave in not hiding their experiences, but speaking up. They have done so on behalf of the many thousands of people in similar situations in Chinese jails and in the Chinese legal system. We owe them a debt of gratitude as they continue to speak up. It is estimated that there are something like 5 million prisoners in Chinese jails, of whom over 5,000 are estimated to be overseas nationals. We do not know how many of them are British, and we do not know what support they are getting from British consular missions. Perhaps the Minister could tell us how many British nationals, in addition to Jimmy Lai, are in Chinese prisons at the moment and explain what support they are receiving.

[Sir Iain Duncan Smith]

I wonder whether my hon. Friend might be so bold as to ask the Minister how many have been in prison for longer than a year and are still awaiting trial. Many of these people have not even had the right to a trial.

[Tim Loughton]

That is entirely the point. It is not just a question of their having dodgy justice, but a question of their having to wait years and years, just like the 45 people who are still going through what is likely to be a six-month trial. They were in jail, restricted of their liberty, for many months before that.

As my right hon. Friend the Member for Chingford and Woodford Green mentioned earlier, more than 100 people have been remanded in custody for an average of nearly two and a half years. Under trumped up charges, they are incarcerated in pretty grim conditions before they even have a chance to argue their case, if indeed they are given that chance. Often the defendants are not even allowed in court to argue their case. The jury system does not exist in many cases, and the verdict is predetermined. Something like 99.9% of all those prosecutions result in a conviction, and 99.9% of appeals against those convictions are turned down.

As I said, justice does not exist in Hong Kong and the whole of China. There have to be consequences when that specifically undermines British interests and when the British agreement has been, in the Foreign Office’s own words, flouted and breached. Other nations seem to be taking that breach more seriously than one of the co-signatories of that agreement, which has a duty of care to the many millions of citizens still in Hong Kong, let alone the increasing number escaping its borders.

There is no rule of law, and the cases that I cited predate the national security law, since when things have got much worse. We know that the Chinese do nothing when faced with just a war of words. The only time the Chinese take notice is when those allegations have consequences and Governments follow through on those consequences. Other nations, particularly the Americans, have followed through with legislation that has had direct consequences for the ability to trade, for people’s ability to travel, for investment and so on, and it is bizarre and completely unacceptable that we have not followed the Americans’ lead on even a fraction of those.

[Dominic Raab (Esher and Walton) (Con)]

My hon. Friend is giving an excellent speech. I think what he is reaching for and what would be helpful to know from the Government is what we, the Foreign Office or the UK are doing to take action. He has mentioned sanctions. When people are effectively taken as pawns or hostages, the other thing we can and should do—in relation to Beijing, but also Iran, Russia and many other countries—is raise that under the new arbitrary detention mechanism alliance that we pioneered with Canada. Does my hon. Friend agree that sanctions and words alone are not enough, and that action in international fora that can embarrass those who take hostages is imperative?

[Tim Loughton]

I completely agree with my right hon. Friend. That is just one of many devices available to the United Kingdom Government. For some reason, they have chosen to use none of them.

Let me give the Minister a series of questions; I hope that he has plenty of time to answer them and many others that have arisen. Do the Government agree with the UN Committee on Economic, Social and Cultural Rights that the national security law

“has de facto abolished the independence of the judiciary of Hong Kong SAR”?

What steps will the Government take to communicate their discontent with China’s ongoing breaching of the internationally binding Sino-British joint declaration? It should not just be, “You are a bit naughty. We signed this agreement, and you do not seem to have stuck to it—would you mind awfully doing something about it?” It must not be that sort of “Dad’s Army” sergeant approach to things: “Would you mind awfully?” There have to be consequences. What are the Government doing about it? If the Chinese say nothing, what will we then do in response?

I have some more questions. What assessment have the Government made about reports that Hong Kong’s status as a financial centre is being used to bypass western sanctions on Russia? What assessment have the Government made of UK strategic assets currently held by the Hong Kong Government? What plans do the UK Government have to review the status of Hong Kong’s economic and trade offices in the UK following the enactment of the national security law and the incident at the Chinese consulate in Manchester, which my right hon. Friend the Member for Chingford and Woodford Green mentioned? Extraordinarily, the consul general not only admitted to having beaten up somebody who was protesting outside—there was no hiding it—but, when interviewed on television, said, “Well, it’s my job.” He was bang to rights. What further evidence was needed? It was on film—in his own words. He had broken the law and assaulted somebody who was freely at liberty in the United Kingdom. The Government did nothing until he was spirited away by the Chinese Government, and then it was too late.

I have three other questions. What actions are the Government taking to protect Hongkongers now in the UK who face harassment, intimidation and threats from agents of the Chinese Communist party after the incident in Manchester? Lots of people are rather scared that they are going to have a knock on their door. What steps are the Government taking to expand their Chinese expertise in the Foreign, Commonwealth and Development Office, including through the recruitment of Cantonese and Mandarin speakers?

Finally, what support are the Government offering to UK nationals who have been targeted by the national security law? I declare an interest, because those nationals include the seven parliamentarians who have been sanctioned under the national security law, the consequences of which, other than the bans on travel and investment, we do not know. We have been offered no protection or added support by the Government, and yet the Government continue to be willing to meet representatives of that regime and give them publicity, as if we were dealing with any other normal democratic nation that respects the rule of law. China does not. It does not in Hong Kong. This law is appalling. We do not just need to say so; we need to make it clear to the Chinese that there are consequences from going through with it.

15:35

[Patrick Grady (Glasgow North) (SNP)]

It is a pleasure to serve under your chairmanship, Sir George. I congratulate the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) on securing the debate, and I recognise his determination to keep the persecution in Hong Kong and the Government of China’s record on human rights more generally as live issues for consideration by this House and for response and action by the UK Government.

The UK’s history as a colonial power in Hong Kong has left a series of moral and legal obligations on this country. The population of Hong Kong, like the populations of many countries around the world, are still living with the legacy of an era and a mindset that saw territories and peoples as the playthings of men who thought themselves so powerful that they could decide the fate of empires from thousands of miles away in the Locarno Suite and the Map Room of King Charles Street. If that mindset is wrong in the present day, and we rightly condemn strong men and dictatorial regimes who seek to annex or govern territories without democratic mandates, we must also recognise that that kind of mindset was wrong when it was being exercised in this country in years gone by and be clear that we intend to learn lessons from the past and resolve to work for democracy, freedom and human rights around the whole world.

As the right hon. Member for Chingford and Woodford Green said at the start of the debate, even in the complex story of postcolonial transitions, the Sino-British agreement regarding the future of Hong Kong is probably unique. He was right to stress that of particular relevance to this debate is the agreement between both parties that the economic and social systems in Hong Kong prevailing in 1997 would remain unchanged, as would the rights and freedoms enjoyed by the population, with a commitment that this would last during the 50-year handover period. This was to be the basis of “one country, two systems”, and the agreement represented an internationally ratified and binding agreement between the UK and China.

We are now 26 years—a little more than halfway—through that period. It is clear from all the contributions to the debate that the pace of change in Hong Kong, particularly with regard to rights and freedoms, is considerably faster and more detrimental to those rights and freedoms than foreseen in the agreement. In short, the Government of China and the Chinese Communist party are not keeping up their end of the bargain.

Nowhere is that clearer than in the implementation of the national security law, passed by the Parliament in Beijing, bypassing and without reference to the Legislative Council in Hong Kong. I am sure the Minister will be quick to condemn central Government for making laws for territories that have established legislative autonomy without consent from the legislatures of those territories. We have heard how comprehensively the law restricts basic rights to freedom of speech and assembly in the name of preserving loosely defined national security in the face of so-called secession, subversion, terrorism and collusion with foreign forces.

The hon. Member for East Worthing and Shoreham (Tim Loughton) was right in his valuable contribution to highlight that this is not new; this kind of oppression has been going on for a very long time, and he cited some important case studies. Amnesty International has said of the national security law:

“The consequences are grave—the undefined nature of key aspects of the law has created fear among people in Hong Kong”

about what may

“put them at risk of criminal prosecution, removal to the mainland or deportation from the territory.”

We have heard about a number of specific cases where this law has been applied, demonstrating exactly the concerns raised when it was passed three years ago. The detention of Cardinal Joseph Zen, along with other humanitarian activists, was of particular concern. As the hon. Member for Strangford (Jim Shannon) said, it highlights wider issues around the CCP’s attitude to freedom of religion or belief in China.

The ongoing oppression and detention of journalist Jimmy Lai has been raised powerfully by just about all Members here, and a further law has been passed recently to specifically prevent him from being represented by foreign lawyers. It is important that the Minister responds to the extremely forceful points that have been made. This man holds a UK passport, and that is supposed to be worth something. If the rights outlined in his passport are diminished, the rights in all our passports are diminished, and how we are supposed to travel with confidence is of considerable concern.

The US-based Hong Kong Democracy Council says that the only countries incarcerating political prisoners at rates faster than Hong Kong are Myanmar and Belarus. Belarus, of course, sits outside the jurisdiction of the European Court of Human Rights.

Given the special legal and moral responsibilities that the UK Government have towards Hong Kong and its people, it really is time for action, not words. We welcome the establishment of safe and legal routes for people from Hong Kong to come to the UK—perhaps that model could be applied to other parts of the world for people fleeing oppression who have historical or family ties to the UK—and we welcome the UK’s acceptance that China is not upholding the Sino-British joint declaration, but more clearly has to be done. As the hon. Member for East Worthing and Shoreham said, there has to be action.

Hong Kong officials known to be violating human rights could be included on the UK’s Magnitsky sanctions list. The Government could publish an asset audit of Hong Kong and Chinese officials linked to human rights abuses. They could establish an illicit finance commissioner to monitor the presence of such assets. As the right hon. Member for Ashford (Damian Green) hinted, they could explain what robust pragmatism actually means. What would be required to take a more robust and less pragmatic approach?

How does the Minister expect the Economic Activity of Public Bodies (Overseas Matters) Bill to affect the ability of local authorities and other agencies to use their democratic processes to decide not to buy or invest in activities in China? We had examples of where people might not want to buy goods that had been manufactured in China, for various reasons. Can he assure us that no state pension funds are being invested in stocks or bonds of firms complicit in gross human rights abuses?

Ministers will have heard these calls repeatedly from the SNP Benches and others today and in previous debates and are clearly paying close attention to them. I have no doubt that the right hon. Member for Chingford and Woodford Green and others will continue to turn up the volume on these issues until we see meaningful action from the Government.

15:41

[Catherine West (Hornsey and Wood Green) (Lab)]

It is a pleasure to serve under your chairmanship, Sir George, and to hear once again an excellent speech from the right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith). He has consistently upheld human rights in Hong Kong and in China more generally. I firmly believe that these debates are strengthened when they are genuinely cross-party. It was also great to hear the hon. Member for Strangford (Jim Shannon) underline the number of women affected by the national security legislation that came in three years ago this month.

We all know that the promised transition to full universal suffrage for the Legislative Council and the election of the Chief Executive of Hong Kong never materialised; following that, protests of growing strength have been seen repeatedly since the handover of sovereignty to China in 1997. It is for that reason that I, along with many other Members here, across the House and in the other place, belong to the Hong Kong Watch committee. We originally thought that that would be short-lived; unfortunately, it goes from strength to strength. We are now seeing the continuing breaching of the Sino-British agreement, and that means that, sadly, Hong Kong Watch has to carry on.

The effects of the national security legislation cannot be overstated. Before it was passed, there was at least a vestige of legal separation between the judicial, security and legal systems of Hong Kong and the Chinese mainland, offering a vital buffer and protection for the people of Hong Kong. That has effectively been erased. The people of Hong Kong now live with the knowledge that their wrongdoing, perceived or otherwise in the eyes of Beijing, can see their deportation and detention in the Chinese mainland and away from the few safeguards of liberty that exist in Hong Kong.

Many Members have mentioned the case of Jimmy Lai, and I think it is appropriate to mention it again, as he is a British citizen and passport holder. Will the Minister comment on that case in his remarks? I raised the issue with the consul general based in Hong Kong when he was here for a visit a couple of months back, and was given assurances that a consular process is in place. It would be really helpful if the FCDO were to write back to us with an update on the number of visits, how regular those visits are and what the findings are of that consular work.

We are mindful that a recent Foreign Affairs Committee report on the way that British citizens in prison abroad are looked after generally was very critical of the Government. It would also be helpful in that regard to examine more closely exactly what the provision for Jimmy Lai is, as a prisoner who was simply using his freedom of expression, as well as how he is getting on and what the consul general and his team are doing.

[Bob Seely (Isle of Wight) (Con)]

I thank the hon. Lady for giving way. As a member of the Foreign Affairs Committee, I know we are concerned to hear whether Ministers can be more vocal when speaking out for British prisoners, or political prisoners across the board—in the case of not only Jimmy Lai, but Vladimir Kara-Murza.

[Sir George Howarth (in the Chair)]

Order. Before I bring in the shadow Minister, I want to point out that I know the hon. Gentleman has an express interest in this subject, but it is not good to intervene right at the end of a debate without having listened to it.

[Catherine West]

Thank you very much, Sir George. I recognise that Members of the Select Committee do have special knowledge, but your ruling is your ruling.

Given that dark backdrop and the noticeable curtailment of their freedoms—again, those contained in a legally recognised treaty—it is no surprise that hundreds of thousands of Hongkongers have fled in recent years, with many now calling the UK home. We welcome them here with open arms. I am proud of the part that the Labour party—particularly my hon. Friend the Member for Wigan (Lisa Nandy), as former shadow Foreign Secretary, and my hon. Friend the Member for Aberavon (Stephen Kinnock), as my predecessor—played in urging the Government to amend the rules governing BNO passports, rightly opening up a pathway for citizenship for BNO passport holders, and providing hope for a new life away from China’s erosion of Hong Kong’s way of life.

That said, there remains significant concern in the community of Hongkongers now in the UK that they are still at risk of intimidation from the Chinese Government. I am afraid to say that the UK Government’s response to that mounting fear has been woefully lacking, with the Foreign Secretary’s response to me in the House the week before last being yet another example of Government Ministers passing the buck. I have repeatedly raised the need for a true concerted cross-Government approach to this growing threat, to ensure that Hongkongers, and other groups seeking refuge in the UK from the Chinese Government, are protected, whether they are working, studying or campaigning. I hope the Minister will address that question.

Although many now make their lives in the UK, we must pay due attention. We should not—indeed, cannot—turn our backs on those who remain in Hong Kong, and consider further erosion of Hong Kong’s way of life as a fait accompli. Doing so would turn our backs on British citizens such as Jimmy Lai and give carte blanche for further breaches of international law. As a signatory of the Sino-British agreement we have a legal, not to mention a moral, duty to continue fighting for the rights promised to Hong Kong until 2047.

I am pleased that the Foreign Office continues to provide Parliament with a six-monthly report, but I am concerned that the level of interest has waned, with very little notice being given to the latest release of the report, despite its stating clearly that the Government believe China was in a continued state of non-compliance with the Sino-British agreement, and stating clearly and worryingly that freedom of the press came under increasing pressure.

I have some asks of the Minister. First, I know he values multilateral engagement. Will he tell the House what recent discussions Ministers have had with allied Governments who have also criticised the treatment of Hong Kong and the implementation of the security legislation—specifically the US, Canada and Australia? Secondly, what discussions has he had with British business and multilateral corporations active in the UK about the impact of the legislation on their workforces, and the need to ensure that BNO passport holders can still gain access to any money or pensions they hold in Hong Kong bank accounts? I know he will be aware that that specific point has been raised by a number of Members across the House over the past few months.

Thirdly, will he update the House on the level of consular access Mr Lai is receiving, which I mentioned earlier? Finally, have the Government given any further consideration to the sanctioning of officials involved in the most repressive aspects of the crackdown on liberty in Hong Kong? I asked that question of the Minister of State, the right hon. Member for Berwick-upon-Tweed (Anne-Marie Trevelyan), who usually deals with this matter, and she said that the FCDO was looking at the matter of our sanctions being out of kilter with similar countries.

We will always be united in calling out the Chinese Government for their breach of the Sino-British agreement, and the curtailment of liberty in Hong Kong, specifically since the national security legislation was passed. Some freedoms remain available to Hongkongers, for which I am grateful, but we must be louder and stronger, and stand up where bullying occurs. We must condemn what has happened and continue to hold in our thoughts those in prison today, held as political prisoners by the Chinese Government.

15:49

[The Parliamentary Under-Secretary of State for Foreign, Commonwealth and Development Affairs (Leo Docherty)]

It is a pleasure to serve under your chairmanship, Sir George. I am very grateful to my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for securing this debate and for all the work he does in this area. I am also grateful to other right hon. and hon. Members for their important contributions, including the hon. Member for Strangford (Jim Shannon), my right hon. Friend the Member for Ashford (Damian Green), my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) and the hon. Members for Glasgow North (Patrick Grady) and for Hornsey and Wood Green (Catherine West).

This has been a lively debate. I should say that I am answering on behalf of the Minister of State, my right hon. Friend the Member for Berwick-upon-Tweed (Anne-Marie Trevelyan), who is currently engaged on other parliamentary duties. I will try to cover the many questions that Members asked.

Three years ago, following widespread protests, Beijing imposed the national security law on Hong Kong, and the UK, along with international partners, immediately made clear our strong objection to it. We declared its imposition a further breach of the Sino-British joint declaration, which China willingly signed up to in 1984. The crackdown that accompanied the national security law has changed Hong Kong forever.

Three years on, we have seen how that opaque and sweeping law has undermined the rights and freedoms enshrined in the joint declaration and Hong Kong’s Basic Law. Hong Kong’s governance, rights and social system are now much closer to mainland norms, and the autonomy promised under “one country, two systems” has been eroded. Hong Kong is less politically autonomous than at any time since the handover. Hong Kong authorities, under the direction of Beijing, have targeted critical voices across Hong Kong society. As Members highlighted, those facing prosecution include former political leaders, pro-democracy figures and members of Hong Kong’s civil society, trade unions and media outlets.

Many of those arrested in 2019 and 2020 are only now going on trial. A panel of judges, hand-selected by Hong Kong’s Chief Executive, hears those cases, and as they progress through the court, new legal precedents will be established, shaping the future rule of law in Hong Kong, which is deeply worrying.

One of the main figures is Jimmy Lai, whose case has been discussed extensively today. He was one of Hong Kong’s most successful businessmen, and was the former publisher of Apple Daily. He has been prosecuted on multiple fronts in an obvious attempt to silence and discredit him. He is a British dual national—he is a British passport holder. Of course, he has never rescinded his Chinese nationality, which has a bearing on this case.

[Sir Iain Duncan Smith]

He is not a dual national; his family has made that clear. He has one passport and one citizenship: British. He does not have any reference now to any dual nationality whatever. Will the Government please start calling that out?

[Leo Docherty]

I am grateful to my right hon. Friend. My understanding from officials is that Mr Lai has never rescinded his Chinese nationality, and we therefore refer to him as a British dual national. But of course, we care very deeply about his case, and we raise his detention with Chinese and Hong Kong authorities at every opportunity, making clear our objections to these politically driven prosecutions. The Foreign Secretary did so with Chinese Vice-President Han Zheng in May, and we have set out our concerns at the highest levels in Hong Kong. Our diplomats in Hong Kong have attended Mr Lai’s court proceedings since his arrest in 2020, and will continue to do so. The Minister for the Indo-Pacific met Mr Lai’s son Sebastien and their international legal team, and officials continue to support them. Mr Lai’s national security trial is due to start in September, and we will of course monitor it exceptionally closely and will continue to press for consular access.

Mr Lai’s case is of course not the only significant one, as we have heard. Hong Kong’s largest national security trial is ongoing, with 47 former pro-democracy activists and politicians facing allegations of so-called subversion. Those cases and others demonstrate in the starkest way that the national security law is being used to stifle dissent. As to possible numbers and whether that includes any British nationals, I will ask my colleague the Indo-Pacific Minister to write to clarify that to my right hon. Friend the Member for Chingford and Woodford Green.

The national security law has damaged Hong Kong’s media landscape irrevocably. I commend the recent report published by the all-party group on Hong Kong, which highlighted the parlous state of media freedom there. A city that was once ranked 18th in the world press freedom index now sits close to the bottom, at 140 out of 180 countries. The Chinese Government undertook to protect press freedom and freedom of speech in Hong Kong under the joint declaration, the Basic Law and, allegedly, the national security law, and yet outlets such as Apple Daily and Stand News have been forced to close. Their publishers and journalists face national security charges of being critical of the Chinese and Hong Kong authorities. We will always defend media freedom and the right of journalists to do their job.

The UK responded rapidly and decisively to the imposition of the national security law. As a demonstration of our commitment to Hong Kong and its people, as has been described today, we opened our doors to the people of Hong Kong looking for a home, creating a bespoke visa route. We have now granted more than 160,000 applications made by British nationals overseas wishing to come to the UK by that route. My right hon. Friend the Member for Ashford asked about the prospect of their political involvement and whether they should be debarred from being MPs, but I will ask my colleague the Indo-Pacific Minister to write in response, because that is an interesting point.

We are steadfast in our support for the Hong Kong diaspora and we are committed to ensuring their successful integration into local communities. We will not tolerate any attempt by any foreign power to intimidate, harass or harm individuals or communities in the UK. The defending democracy taskforce in the Home Office, under the Security Minister, is reviewing the UK’s approach to transnational repression to ensure that the response across Government and law enforcement is robust and joined up.

In the broader context, we have suspended the UK-Hong Kong extradition treaty indefinitely, and we have extended to Hong Kong the arms embargo applied to mainland China since 1989. Meanwhile, we alert British nationals and businesses—that was raised today—to the impact of the national security law, and to the risks it poses, in our travel advice and in our overseas business risk guidance on the UK Government website.

The Foreign Secretary made clear our position on China in his speech at Mansion House in April. We will work with China where our interests converge, while steadfastly defending our national security and our values. The role of the Foreign Secretary and Ministers is to engage foreign Governments, including those with whom we disagree. I should tell colleagues that when Minister of State Lord Johnson visited, he spoke out in local media against the erosion of rights and freedoms in Hong Kong.

Time is tight and I want to leave time for my right hon. Friend the Member for Chingford and Woodford Green to wind up, so I will ask the Indo-Pacific Minister to write to my hon. Friend the Member for East Worthing and Shoreham to address his extensive list of valid and commendable questions, and to my right hon. Friend, who introduced the debate, about the National Security Bill and the prospect of any energy deal. I will ask the Minister to write with the answers to those questions. In closing, the UK will continue to stand up for the rights and freedoms of Hongkongers and the autonomy that Hong Kong was promised.

15:58

[Sir Iain Duncan Smith]

I understand that my hon. Friend the Minister, who answered from the Government standpoint, had less time than he might have hoped for. That notwithstanding, I hope that he will follow up with answers to the questions that we asked—not least because being steadfast is one question, but taking action is another. I recommend a move from robust pragmatism to just robust action. That is the point of sanctions. Why have we not sanctioned any single person from the Administration on the imposition of the national security law? That is a consequence that China would lift its head up to.

I will finish simply on this single point. Jimmy Lai is a British passport holder and citizen. Every time the Government refer to him as a dual national, they play into the hands of the Chinese Government, who do not recognise dual nationality. I wish we would stop that nonsense. The price of freedom is very high, but the price of no freedom is even higher. We have a British Government believing in democracy and freedom; it is time that we told the Chinese Government that there are consequences when they strip away from people freedom and their rights.

Motion lapsed (Standing Order No. 10(6)).

Great British Nuclear

Wednesday 28th June 2023 Westminster Hall

[Relevant document: Third Report of the Welsh Affairs Committee, Nuclear energy in Wales, HC 240.]

16:00

[Virginia Crosbie (Ynys Môn) (Con)]

I beg to move,

That this House has considered Great British Nuclear.

It is a pleasure to introduce this debate on Great British Nuclear. Quite simply, the formation of Great British Nuclear, headed by the interim CEO—the brilliant Gwen Parry-Jones, who lives on Anglesey—has given us the best opportunity in 40 years to kick-start a programme of new nuclear power stations in this country. I want to remind hon. Members, if they need reminding, that nuclear is vital to our journey to net zero, to our drive for energy security and to our prosperity as a country, with jobs and opportunity reaching every corner of these islands.

In just one technology, nuclear provides energy that is clean, reliable, affordable and British. It is the only technology that can say that. Common sense and every bit of modelling and evidence from countries right around the world tell us that we need nuclear, operating whatever the weather, to complement technologies such as wind and solar, and to wean us off imported fossil fuels.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Lady for securing this debate. From the very beginning of her time in this House, her interest in her constituency and in nuclear power has been prominent, and I congratulate her on that. Does she not agree that the war in Ukraine and the accompanying fuel crisis have underlined the vital importance of nuclear’s capacity, and that £20 billion for a large-scale plant, with additional support for small modular reactors for a plant that helps with this nation’s self-sufficiency, is a price that we must be willing to pay? I have always supported nuclear, and I support the hon. Lady today.

[Virginia Crosbie]

I thank the hon. Member for his intervention and for his kind words. He is a true champion for his constituency and certainly for the nuclear sector. I absolutely agree with him. We have to invest in this new technology, and the time is now. It is important for net zero and for all those fantastic jobs. We cannot achieve net zero without it; we need that energy security.

Nuclear’s record in local communities speaks for itself: it provides high-quality, long-term and skilled jobs that pay wages two or three times what people get outside the power station. My community and many others around the UK that have had nuclear power know that it delivers good-quality jobs and local investment—and they say they want more of it. That, as hon. Members may guess, is my particular interest in today’s debate.

We have made great progress on nuclear in recent years, introducing the new regulated asset-based funding model, investing in Sizewell C and putting money into the Rolls-Royce reactor design. We also had the Chancellor’s welcome announcement that we will green-label nuclear, crowned by the formation of Great British Nuclear. We even have, for the very first time, our very own Nuclear Minister.

I can attest to the wave of energy and optimism that GBN’s formation has given to the industry. The Minister will know that technology vendors and developers from all over the world have entered the small modular reactor down-selection process that GBN is running at the moment. Many have come to visit Wylfa in my constituency of Ynys Môn to see the best site in the UK for further nuclear development. The likes of GE Hitachi, Rolls-Royce and Last Energy have all toured the island.

Today, I want to focus on how GBN can convert reactor technology, sites and strong political support from the Government into new projects in constituencies such as Ynys Môn. I hope the Minister is listening carefully. If I start with the small modular reactor down-selection, we should expand the prize of winning. At the moment, that prize is co-funding to help to develop the winning technologies up to the point of a final investment decision.

That is a good start, but we can go further. The winner should get access to named sites that are suitable for building small modular reactors; access to a funding model, such as the regulated asset base model or contracts for difference, to help to raise money; and help from GBN to form the actual project companies that will develop, own and operate the nuclear power stations once they are built.

The first SMR being built in the western world, at Darlington in Ontario, Canada, followed exactly that model. About five years ago, Ontario Power Generation ran a selection process, as we are now, and at the start it was clear that whoever won the selection would build an SMR at the Darlington site and that Ontario Power Generation would develop, own and operate the site. The winners had a site, an order, and a project developer and operator. That is the model that we should follow, because that is how we give investors enough confidence to put their money into such projects.

I am delighted that the Energy Bill gives GBN the power to form subsidiaries and joint ventures with the private sector to do exactly that type of individual project development, and I want to hear how the Minister’s Department will support GBN in doing just that. More than that, I want to hear whether the Minister has thought about awarding sites and offering funding modes to the winners to accelerate the process of deployment and quicken investor interest in the UK.

If the Minister needs sites to offer, I have one in mind: the best site for new nuclear in the UK, Wylfa. Our need for new nuclear means that we have to build more large-scale nuclear as well as small-scale nuclear. Large-scale nuclear, which is often unfairly maligned, has actually had a banner year. All three major western designs—the EPR, the AP1000 and the APR-1400—have connected reactors and entered commercial operation. Coincidentally, I think that the owners of those designs have all expressed an interest in a Wylfa site. Will the Minister say what further thought has been given to other large-scale projects after Sizewell C to capitalise on that interest, and also set out his thinking on the circumstances under which we will pursue more large-scale nuclear in this country?

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

I congratulate my hon. Friend on securing this debate on a very important issue, which will hopefully help to secure Britain’s future energy security. One of the challenges with Sizewell C, which I think will be reflected across the country, is EDF’s failure to properly engage with many communities in Suffolk about their legitimate but easily accommodated concerns about the construction of the plant. What could the Minister do to ensure better engagement for future nuclear plants?

[Virginia Crosbie]

My hon. Friend makes an excellent point. One of the reasons why nuclear sites are successful is support from the local community. That is absolutely vital, as we see with development consent orders for planning. We have seen that with Wylfa, and we have certainly seen it with Hinkley. It is vital that companies engage with local residents.

The Minister will know that Hinkley Point C provides nearly 10,000 jobs on site and supports over 3,000 jobs throughout the construction period, with companies based in Wales, and that £815 million is expected to be spent throughout the Welsh supply chain during construction. There are 22,000 people working across the country, and more than £5 billion spent across the region. What a prize a large-scale project is for a local community. I ask that large-scale developments and SMRs be pursued with equal vigour.

I know, of course, that there is the issue of money. I am convinced that the private sector is willing and able to invest in nuclear if it knows that the UK Government are standing right behind it and the nuclear projects. The planning, regulation, site access and funding models on offer are all within the Minister’s gift, or the Government’s gift. I am sure that the Minister will understand why investors are keen to see Ministers stand by projects, as they have with Sizewell C. That is my request to the Minister: that GBN is able to offer the Sizewell C model —regulated asset base funding, a Government support package and a 20% direct Government stake in the project —to the next two projects that the Government target to get to FID, the final investment decision, in the next Parliament and to all future projects. That would certainly be a godsend to investors and give communities such as mine real hope that new projects will get off the ground.

I will end on this note. On the island, we have been talking actively about new nuclear at Wylfa for 15 years or more. It has not happened, and it has been difficult for the local community to deal with that disappointment and still put their confidence in nuclear as a way to create opportunities for young people on the island. But they still put their confidence in nuclear. They still want the projects, investment and jobs. They look to me, the Minister and his colleagues to get it done. I simply ask him to return the faith that they have put in us, and to help us to get new nuclear at Wylfa over the line. Diolch yn fawr.

16:14

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Andrew Bowie)]

It is an absolute pleasure to serve under your chairmanship, Sir George, and—my goodness me—to discuss nuclear with my hon. Friend the Member for Ynys Môn (Virginia Crosbie). The passion that she brings to this debate is unmatched. The term “champion” is bandied about a lot in this building, but she genuinely is one of the greatest champions for nuclear. Indeed, ever since she arrived here in late 2019, she has been an incredible champion in Parliament for her constituency and its interests.

My hon. Friend has an impressive track record of championing her constituency, as I have said, to remain at the heart of decisions on the future of nuclear power, the investment that it could bring and the jobs that it could create, both locally and across the United Kingdom. I will continue to encourage Government and Great British Nuclear to engage with communities such as hers that are considering whether their land might be suitable for the deployment of nuclear facilities in the near future.

The invasion of Ukraine and the subsequent rise in global energy prices have demonstrated the paramount importance of accelerating home-grown power and strengthening our national energy security. The hon. Member for Strangford (Jim Shannon) put that better than I ever could in his intervention. That is in addition to the significant contribution that nuclear could make to achieving our net zero objectives.

As part of our response, the Government have committed to ensuring that the UK is one of the best places in the world to invest in civil nuclear power, and are taking the necessary steps to revitalise the UK’s nuclear industry. Last year alone, the Government made an historic investment of £700 million and became a shareholder in the Sizewell C project, in support of our long-standing objective to take a large-scale nuclear project to the point of final investment decision in this Parliament, subject to all relevant approvals.

[Dr Poulter]

The Minister will also be aware that the Secretary of State overruled some of the concerns with the development control process that supported Sizewell C going ahead. Although most of us accept the importance of investment in projects such as Sizewell C, one of the main concerns was about the failure of EDF to engage with legitimate concerns across Suffolk and its communities about the construction process and the eventual building of Sizewell C. What reassurance can the Minister give to residents that lessons will be learned from that?

[Andrew Bowie]

Perhaps it will reassure my hon. Friend to know that I made it a priority to visit the Sizewell C site, not just to see the site and meet EDF and the Sizewell C company, but to hear from and engage with local communities, including those with concerns about the project, how the consultation exercise was run and the engagement with the companies involved. I look forward to continuing my engagement with those individuals and communities that are concerned about the project and the vast number of critical national infrastructure projects that will be built in and around the hon. Gentleman’s constituency. Those are critical pieces of national infrastructure, but in delivering this new investment into our grid and this incredible investment in Sizewell C, it is vital that we take communities with us and that they feel that they have had a say in the process of getting to the final decision on whether to proceed. I give my commitment, here today, that I will continue to meet the groups concerned and will do so right up to the point that there are spades in the ground at Sizewell. Indeed, whoever my successor is will do the same.

The British energy security strategy set out our ambition for deploying up to 24 GW of nuclear power by 2050, which would be 25% of our projected 2050 electricity demand. That includes two nuclear projects taking final investment decisions in the next Parliament. We also announced the creation of Great British Nuclear, which will be an arm’s length body responsible for driving delivery of new nuclear projects, backed with the funding that it needs.

GBN will be at the heart of a programmatic approach that will give industry and investors the confidence necessary to deliver projects at pace, reducing costs through learning and replication. Earlier this year, the “Powering up Britain” set out our plans for GBN to launch a competitive selection process for choosing the best small modular reactor technologies in the UK.

In April, GBN launched the first stage of this process in the form of a market engagement exercise. The second phase, the down selection process, will be launched over the summer, with an ambition to assess and decide on the leading technologies by autumn. The Government will provide co-funding to be deployed by GBN to support the development of those technologies and will work with successful bidders on ensuring that the right financing and site arrangements are in place, in line with the commitment to progress projects in the next Parliament. The total level of development funding will be subject to future spending reviews. I hear the suggestions from my hon. Friend the Member for Ynys Môn and will take them back to the GBN board.

GBN will work with the Government on access to potential sites for new nuclear projects to achieve our long-term ambition. This reflects our collective awareness of the growing local and regional interest in a number of sites for further nuclear development. We intend to publish consultation in 2023 as a first step towards the development of the new national policy statement for nuclear, to ensure our approach remains resilient to the needs of achieving net zero.

I assure my hon. Friend that community engagement will be central to the development of projects at each site. Developers will need to work with the host authorities and communities, statutory bodies and other key stakeholders to shape the proposals that will ultimately inform statutory consultation requirements and an application for a development consent order. Further engagement will also be undertaken as part of the wider regulatory processes to be completed prior to the construction and operation of a new power station.

The Government recognise the strong interest in and support for nuclear power across north Wales. The Government are also aware of the potential of the Wylfa site, which is included in the national policy statement for new nuclear power. Looking ahead, both Great British Nuclear and the national policy statement team would welcome any conversations with stakeholders who are considering whether their land might be suitable for the deployment of nuclear facilities in the future. GBN will, of course, support the Government’s consideration of further large gigawatt-scale projects to help us deliver on our net zero ambitions.

Our commitment to a nuclear programme and GBN will put the UK on a path to achieving its ambition and becoming a global leader in civil nuclear power and SMRs, which could include the creation of high-value jobs and the development of our capabilities. I would like to close by thanking my hon. Friend the Member for Ynys Môn for securing this important debate. I look forward to visiting Ynys Môn and continuing to engage with her and other stakeholders in the future.

Question put and agreed to.

16:17

Sitting suspended.

In-work Poverty

Wednesday 28th June 2023 Westminster Hall

16:29

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

I beg to move,

That this House has considered in-work poverty.

It is a pleasure to serve under your chairmanship once again, Sir George. I am grateful to have secured this important debate on the scandal that is in-work poverty. Such a debate should not be needed in the 21st century in one of the wealthiest nations in the world, and yet here we are. I hope the debate will explore why so many people face unacceptable levels of poverty not when they are out of work, but while they are working and earning a living.

“If you work hard, you can earn a decent wage, buy a house and raise a family”—that is the promise the Government made to the country in their last election manifesto when they stated:

“We will help people and families throughout their lives by bringing down the cost of living and making sure that work always pays.”

I do not think it is controversial to say that I agree with that. People who work hard should be able to earn a decent wage, afford a home and raise a family. A job that pays, a home of their own and a family they can support are not great gifts bestowed by a generous Government; they are key indicators of a healthy and functioning society. They are our modest expectations and reasonable aspirations, and any half-competent Government should be expected to deliver them. Cruelly, over the past 13 years, this Conservative Government have not only failed to do their job and deliver for the British people; they have also, systematically, through either incompetence or intention—probably both—prevented millions across the UK from getting on in life, trapping them in an inescapable cycle of poverty and hardship.

Data from the Department for Work and Pensions shows that one in five people in the UK were in relative poverty in 2021-22. It is clear that working does not preclude a family or an individual from poverty. After housing costs, 71% of children and 57% of working-age adults who are in poverty are in poverty. In-work poverty has increased by a shocking 1.5 million people since the Conservatives took office in 2010. There are three overarching reasons why things have become so bad: earnings, housing and the cost of living. On each, the Government have taken a bad situation and made it much worse.

Wages today are at the same level as in 2005. That is the longest period of stagnation in terms of earnings in nearly 200 years. Public services have been cut to the bone, and many public sector workers have seen their pay significantly eroded by years of below-inflation rises. At the same time, there has been an explosion in the gig economy and other insecure work—a damning indictment of the Tories’ economic and political choices, which have forced ever more people to rely on the benefits system.

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

I congratulate the hon. Gentleman on securing the debate. He mentions the gig economy. Three of the reasons for in-work poverty are insecure work and zero-hours contracts, bogus self-employment and low wages. The Government made promises in response to the Taylor review eight years ago, but we are still waiting for that employment Bill. Does he agree that we need that employment Bill now?

[Mr Dhesi]

I could not agree more. I remember standing in this very place after I had managed to secure a debate on the Taylor review of modern working practices. In fact, some of the same Members who are here today also took part in that debate, during which we asked for the employment Bill to be introduced. It is shocking that only seven of the 53 agreed areas of legislation were enacted. Such intransigence is what leads to more in-work poverty.

For 13 years, successive Conservative Governments have sought to undermine social security in our country. Universal credit is not protecting working families from poverty. More than a third of children and working age adults in working families in receipt of universal credit are still in poverty after housing costs.

Ms Clarke, one of my constituents in Slough, is a nurse who supported the most vulnerable during the covid-19 pandemic. She is struggling to pay for the loans that she took out for her training and has to claim universal credit. For that, she must take annual leave to attend her appointments at the jobcentre. How is any of that fair or right? She is a nurse and a single mother without the support she clearly requires.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

My hon. Friend is making an excellent speech about in-work poverty. Does he agree that universal free school meals would help alleviate in-work poverty for those at the lower end of the wage spectrum? They are already available in primary schools in Scotland and Wales, and the Mayor of London has announced that they will be extended to primary schools across London. Northern Ireland has a higher earnings threshold of £14,000, which is double the England threshold of £7,400. Does my hon. Friend agree that that would provide a massive boost and really help those people in work who are in poverty, especially the lady he has just spoken about?

[Mr Dhesi]

My hon. Friend is a doughty champion for free school meals. She is known as the all-party parliamentary group queen and has organised various events, including on free school meals. I remember highlighting their importance as we served them alongside dinner ladies and gents. I thank my hon. Friend, because I will bring home that point of view later in my speech.

The punitive benefits system is driving more people to use food banks. At Slough food bank in my constituency, kind and amazing people who undertake much-needed selfless service report that six in 10 of the people they support are on universal credit, and many of them are employed. Charities openly acknowledge that they would rather not exist because they do not want a society where working people are forced to rely on food parcels to survive.

It is worth noting that in 2010 the Trussell Trust operated only 35 food banks. Staggeringly, today that number is closer to 1,300 across the UK, and between April 2022 and March 2023, they gave out 3 million emergency food parcels. That is a third more than during the pandemic and double the number before the pandemic. What a shocking legacy this Government are leaving behind.

[Stephanie Peacock (Barnsley East) (Lab)]

I congratulate my hon. Friend on securing this important debate. In Barnsley we have seen a tripling of demand for food banks. As he rightly points out, we did not have any 10 to 15 years ago. It is because of the Government that, sadly, 35% of kids in Barnsley are growing up in poverty and families are relying on food banks. They are in work but cannot afford to pay their bills.

[Mr Dhesi]

My hon. Friend has eloquently explained what the experts across our country are explaining: this is happening before our very eyes and we should not allow the situation to deteriorate any further.

As many will know, housing is a huge and growing driver of in-work poverty. Thanks to the Government’s failure to build enough new and affordable homes and new social housing, last year the gulf between price of houses and earnings in the UK was the worst since 1876. We really are back in Victorian times under this Government.

One of my Slough constituents privately rents and wrote to me for help. As many other private renters have experienced, they have been served with a section 21 no-fault eviction notice. Their partner works full time, but they themselves cannot work full-time hours because they have cancer. High rent costs mean that they cannot now find anywhere that is affordable. Although the family are on universal credit, it does not cover the basic cost of living. Even if they did find somewhere with an affordable rent, the need for a large deposit and a guarantor has erected huge barriers to finding new, long-term accommodation.

The supply of social housing has continued to plummet. The Government’s promise—cancelled, then reinstated—to build 300,000 new homes each year has not materialised. As my right hon. and learned Friend the Leader of the Opposition said at Prime Minister’s questions today, house building has collapsed and the Government are nowhere near their target, which means that more people are trapped in private rented accommodation as rents go through the roof. In turn, that means that people are taking longer to save for their first house. That is why levels of home ownership are down and private renting is up. Those who have been fortunate enough finally to buy a home after years and years of saving now face mortgage misery the likes of which we have not seen in generations or perhaps longer, thanks to this Government’s inability to get to grips with inflation.

Perhaps if Ministers were more focused on supporting those impacted by their child benefit cap than on removing the cap on bankers’ bonuses, and more focused on spending public money to invest in our public services than on giving away billions in failed personal protective equipment contracts to their mates and cronies, our economy would be in a much better place. Sadly, so many people are in dire straits. On top of stagnant earnings and unaffordable housing, we have a cost of living crisis, driving ever more people into in-work poverty. With food prices soaring and energy and utility bills going through the roof, many working people find themselves unable to put meals on the table, heat their home, pay their bills or provide for their families.

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

The hon. Gentleman will not be surprised to hear that I have a slightly different interpretation of some of the issues that he has presented today. However, one thing that we certainly agree on is that a lot of public sector workers have seen real-terms reductions in their pay; I draw the House’s attention to my entry in the Register of Members’ Financial Interests as a practising NHS doctor. Does he agree that it is particularly important that the Government implement the recommendations of the national pay review bodies about public sector pay?

[Mr Dhesi]

I thank the hon. Member for his intervention. We may disagree about certain things, but hard-hitting facts are hard to ignore, especially when the truth hits us. I agree that the work of the independent pay review bodies is very important, but even this week we have seen the Government, including the Prime Minister, not accepting their recommendations. The Government are very selective in when they agree to the recommendations of the independent pay review bodies. That must change. They should either comply with them or completely disregard them; they cannot do both to suit their needs as required.

[David Linden (Glasgow East) (SNP)]

Can I just confirm that the position of the Labour Front Bench is that Labour would implement the recommendations of the public sector pay review bodies?

[Mr Dhesi]

I thank the hon. Gentleman for his intervention. Today I am not on the Labour Front Bench, but I am sure that the shadow Minister, my hon. Friend the Member for Westminster North (Ms Buck), will highlight exactly what the Labour policy is in that regard. As far as I am concerned, I think it is very important that if we have independent pay review bodies, either they and their work are respected or we do not have them. I am sure that that will be teased out in due course.

The Office for Budget Responsibility forecast in March this year that real household disposable income per person—a measure of living standards—will fall by a cumulative 5.7% between 2022 and 2024. That would be the largest two-year fall since records began back in the 1950s.

One of my Slough constituents wrote to tell me that despite their family of five having a full-time worker and the support of universal credit, they still could not afford their children’s school lunches—an issue that my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) alluded to earlier. Imagine being a parent who has to send their children off to school knowing that they are hungry. They know that they have done everything they can to provide for them; they have worked hard, sought support and tried their hardest, but there is nothing more they can do and their children will be going hungry. It is a desperate situation for so many, and one we should not be seeing in the world’s sixth largest economy.

Child poverty in the UK is overwhelmingly related to in-work poverty. Some 67% of children living in relative poverty in our country come from working households. Households in which at least one adult is in work have seen a steep rise in poverty under the Tories. Absolute poverty has not fallen since Labour was in power. It has stagnated while the Conservatives have been in power, but, most concerningly, it has started to rise. Absolute child poverty is set to increase even more by the end of this year, meaning that another 400,000 children could be going hungry and cold day to day, or even homeless. Are the Government not ashamed?

[Mrs Hodgson]

I just want to add some further statistics to the ones that my hon. Friend is very helpfully providing us with on hungry children. On the economics of universal free school meals, PricewaterhouseCoopers did some work on the numbers and found that for every £1 invested in universal free school meals, the return on investment to the economy in savings on health, child poverty, malnutrition and all the rest is £1.71—so every £1 returns £1.71. Does my hon. Friend not think that that proves the policy would pay for itself?

[Mr Dhesi]

I defer to my hon. Friend’s expertise. I am sure that the Minister is listening and will be looking at why that is so important.

We need a Government who will focus on breaking the cycle of poverty, who will ensure that respect and dignity are once more at the heart of our social security system, who will make it easier to own a home and raise a family, and who will put an end to the soaring use of food banks. We need an economy and a system that work for everyone, not just a select few, and that do not embed poverty through low-paid insecure work, leave children without meals or homes, or see the hard-working go hungry.

[Several hon. Members rose—]

[Sir George Howarth (in the Chair)]

Order. I will impose a four-minute limit on Back-Bench speakers. In view of the number of people who are standing, I may have to lower it again.

16:48

[Ian Lavery (Wansbeck) (Lab)]

As ever, it is a pleasure to serve under your chairmanship, Sir George. I thank my hon. Friend the Member for Slough (Mr Dhesi) for bringing this important debate to the Chamber.

I will start with a couple of statements made in the past week or so that I think are absolutely outrageous. The first was:

“I want people to be reassured that we’ve got to hold our nerve, stick to the plan and we will get through this.”

That was from the Prime Minister. People who are in work, in poverty, will be wondering what on earth the Prime Minister—one of the richest people in the country—knows about in-work poverty. I have no doubt that the Prime Minister works very hard indeed, but he gets the rewards. As my hon. Friend the Member for Slough said earlier in his fantastic contribution, the likes of the Prime Minister will not have seen their kids go to school with an empty belly, holes in their shoes or clothes that have been passed down from older siblings or somewhere else. Indeed, will he have used a food bank, for heaven’s sake? I have to ask that question.

The second statement I want to raise was from the Governor of the Bank of England, who said that

“we cannot continue to have the current level of wage increases…the current levels, I’ll be absolutely honest, are unsustainable.”

This is a man who is on more than half a million pounds. The same applies to him: he will not have had any difficulties when he has been making these decisions and telling people who are in poverty and cannot feed their own kids that they have to accept that they cannot have decent pay increases. The fact that inflation is as high as it is has nothing to do with wages for ordinary people. Ordinary people have not had wage increases. There has been wage stagnation. The facts show quite clearly that there has not been much of an increase since 2005—and look at the situation in the country.

I have been on the picket lines with many people over the past few years. Most of them are fighting for decent wages, terms and conditions. Most of them are now having to use food banks. I ask the Minister: why on earth, in this day and age, in the sixth richest economy in the world, should teachers, nurses, doctors, ancillary workers and public sector workers have to rely on food banks? This is the UK. We are not a third world country. Can the Minister please tell us why it is right and why it is acceptable that people in the health service can do a hard day’s graft and have to visit the food bank to feed their kids? Why are teachers having to do the same? Why are public sector workers, including one in five of those working in the DWP, claiming universal credit? It is an absolute outrage. The fact that people are saying that the route out of poverty is work is an absolute nonsense.

16:52

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Member for Slough (Mr Dhesi) for raising this important issue that affects all our constituencies. In the short time I have, I want to give a Northern Ireland perspective and give an example of what it means to be in in-work poverty by showing how it has affected just one of my constituents. Hon. Members who have spoken have raised vital points about in-work poverty, and those who speak after me will do the same.

I want to briefly highlight the effect of in-work poverty on children. There are approximately 450,000 children in Northern Ireland, and more than 100,000 of them are defined as living in poverty. The interesting figure is that the majority of those children—61%—live in households in which at least one parent is working. The hon. Member for Slough referred, as I will, to the situation where there is only one person in the household who is working.

I have the utmost respect for the Minister. He really wants to help; I say that honestly, and I know that in his reply he will try to address the issues we put forward. I have always found him to be amenable and he tries to give us the answers, so I look forward to that.

Almost one in four children in Northern Ireland live in a family who struggle to provide for their basic needs—a warm adequate home, nutritious food and appropriate clothing—and pay for childcare costs. Parents often have to go into debt to make ends meet and do not have the means to save money for unexpected costs or family outings when the family have just one person working. Children in poverty are twice as likely to leave school without five good GCSEs; they are also more likely to suffer poor mental health and fewer years of good physical health. The impact of poor mental and physical health is important.

It breaks my heart that there are parents working away at low-paid jobs, and yet they are physically unable to do better for their children. The sweat of their brow is not enough to bring a wage into the house that will help them adequately look after their children. For many people, the belief that they would be better off not working is a myth that we must fight hard and combat. I know that the Government want to fight and combat that, so I look forward to what the Minister has to say.

I want to give one example that I believe really illustrates what I am saying, which is that no one should be better off not working. I was helping a mother who is on universal credit with her uniform grant forms. She works part time, and she has three children by herself. Her partner pays her £5 a week. She received a wage increase, and her universal credit went down accordingly. When she mentioned it in work, her supervisor told her, “Well, drop your work by a couple of hours,” as she was no better off, but she stated that her mum raised her to work, and the less she took from the state, the better. That is a difficult view to hold as the cost of living skyrockets and those who are working and still poor do not see the benefit of their employers upping their wages. The hon. Member for Slough referred to people on universal credit who want to do the best they can, but who the system does not help. I have given an example, and so has the hon. Member for Wansbeck (Ian Lavery).

I believe we must have a system in which it pays to work, not to cut hours, and in which children are looked after in the scenario I described. I know that that is a system that the Government want in place. The first step is to ensure that those in work are not poor. People are struggling to pay their mortgage and put diesel in the car; they are cutting down on groceries and stopping their children going to the cinema with their friends whose parents are not working. More can and must be done, and we must take steps so that there can be no doubt that it pays to work. Many people in low-paid jobs are the people I see in my constituency office and the people who I and other MPs have a duty to help.

I thank the hon. Member for Slough and look forward to the contributions of other Members. I look to the Minister to respond with the answers that we wish to hear.

16:56

[Ruth Jones (Newport West) (Lab)]

It is a pleasure to serve under your chairmanship, Sir George. I am grateful to my hon. Friend the Member for Slough (Mr Dhesi) for bringing this debate before the House. While I am on my feet, let me say that I am proud of the wonderful diversity in Newport West, and I wish all Muslims in my constituency and across the country Eid Mubarak today.

We are here to discuss such an important issue. I will speak briefly on behalf of the people of Newport West. Yesterday, I spoke in the House about the 9,500 people in Newport West who will now be forced to pay £2,400 more a year, thanks to the Tory mortgage bombshell and an inflation crisis made in Downing Street. It is clear from my surgeries and from all the emails and letters I receive from local people that after 13 years of Tory Government, people in Newport West are working harder and doing more but earning less in real terms. In-work poverty is a crisis that Ministers seem so unwilling to tackle.

One of my constituents recently contacted me to share her story. She has two school-age children, she works two jobs in two separate superstores and she is picking up overtime whenever it is available. She is really proud that she works, but she is not proud that she is struggling to pay for bus fares and to feed her children. This is the lived experience of our people, these are the challenges that remain unaddressed by Tory Ministers, and these are the difficulties that were made in Downing Street.

I am increasingly hearing from local people, because they come to me after all other routes have been closed, as the systems that should support them have been cut to the bone by this Conservative Government. When the Minister winds up, I want him to tell me what I should say to my constituents and all those who have come to me with their stories of how their monthly pay packets simply do not cover the cost of living and survival. I am sure the Minister will be able to give us a number of stats to claim that things are all fine and hunky-dory—I was in Prime Minister’s Question Time today, too—but I know that my constituents are worse off. They are working all the hours they can get, but it is still not enough.

In-work poverty is very real. As has already been said, we are one of the richest countries in this world. It is a disgrace that people are forced to struggle like this. If Tory Ministers do not want to sort this out, they should get out of the way for a Government who will.

16:58

[Rachel Hopkins (Luton South) (Lab)]

It is a pleasure to serve under your chairmanship, Sir George. I thank my hon. Friend the Member for Slough (Mr Dhesi) for bringing forward this really important debate on in-work poverty.

Having a job should bring people security, so that they can raise their family, yet we are seeing so many more cases where being in work is leading to in-work poverty. Research from the Joseph Rowntree Foundation found that 61% of working-age adults in poverty live in a household where at least one adult is in work, and 11% of all workers live in a household in poverty. The poverty rate for part-time workers is double that for full-time workers—18% compared with 9%—and self-employed workers are twice as likely to be in poverty as employees, at 21% compared with 10%.

In-work poverty does not affect all groups equally. Ethnic minorities have substantially higher in-work poverty and higher child poverty rates. Many ethnic minority groups are more likely to have the types of jobs and working patterns that are associated with in-work poverty. This Conservative Government’s cost of living crisis has seen real-terms pay fall at the fastest rate since 2001, when records began. As we see mortgage rates increase and rents rise, millions face an increased risk of falling into in-work poverty.

I want to focus on housing. Around 2 million households in the private rented sector—around 38% of the total of those in the private rented sector—receive housing cost support through universal credit or housing benefit, yet the Government chose to freeze local housing allowance rates between 2016 and 2020. Although there was a change in 2020, in the pandemic, it has been frozen since that time. Institute for Fiscal Studies analysis shows that in Luton there is now a £100 deficit in the local housing allowance rate, compared with the lowest rents in the area. Office for National Statistics figures show that the median rent paid by tenants in Luton increased by 8% between March 2020 and March this year.

There is also a significant increase in the number of people in a negative budget; they are unable to meet their living costs, despite being in work. The causes of negative budgets are complex, but there are fundamentally two reasons: a low income from being in low-paid work, and having high household costs. Citizens Advice Luton is seeing increasing numbers of people in negative budget, increased personal debt and increased poverty.

I want to press the Minister. What do I say to those families who are working hard, yet struggling to meet their basic living costs? I am deeply concerned that the lack of action on the local housing allowance will mean that more and more of my Luton South constituents will face eviction, as they simply cannot afford their rent.

17:02

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Sir George. I thank my hon. Friend the Member for Slough (Mr Dhesi), my Berkshire colleague, for his excellent work on this important issue. He is a doughty champion for people across our county, and is focused on his constituency. In the time allowed, I would also briefly like to thank families who are under enormous pressure at this time. They are working incredibly hard to keep up with a huge range of increases in costs, whether that is in the price of food, which has rocketed, energy costs, mortgages or rents.

I briefly want to mention some points, to which I hope the Minister will respond. I hope he will be able to direct his remarks to me, my hon. Friend the Member for Luton South (Rachel Hopkins) and my hon. Friend the Member for Slough, because we have many residents in high-cost areas who are under pressure because of the high cost of renting and buying homes in the south-east of England and other high-cost areas.

It is staggering that food prices have risen by around 20% in the past few months. Imagine the impact on most families. The cost of common staple goods, such as Weetabix, pasta, eggs and cheese, which every family rely on daily, and which are almost impossible to substitute in a weekly shop, have all gone up enormously. That is affecting people across the whole country in a most dreadful way. Families are struggling because of that, and there is no easy way to avoid it. Children are desperate for their favourite foods—they are often keen to have specific things. The cost of even own-brand items has gone up enormously.

Equally, the cost of housing has skyrocketed. I have mentioned constituents; there are those whom my hon. Friend the Member for Newport West (Ruth Jones) mentioned in a debate yesterday, who face terrible pressures in the mortgage market. I mentioned a couple of constituents who are under enormous pressure, which is common in my area. There are huge additional costs on mortgages. I spoke about a family paying £800 extra a month for a mortgage on a three-bedroom property in a suburb. Another resident, who lives in Reading town centre, is having to pay an extra £400 a month on the mortgage on her flat. She is already suffering from the cladding crisis, because of unresolved cladding problems with the property. Imagine the pressure that a person in that situation is under at this terrible time.

I hope that the Minister will broaden his response and address some of the related issues around housing and the effect on renters. Landlords are under enormous pressure to put up rents because of the increase in mortgages. That is a hugely important related issue. My hon. Friend the Member for Barnsley East (Stephanie Peacock) made an excellent point about the number of families living on very modest incomes. Rents are increasing dramatically. In the area that I represent, there has been an increase in the proportion of people who rent and a decrease in the number of people who can afford to buy because of the high cost of housing. That puts pressure on many young families, many living in terraced housing or flats in our town centre.

In addition—I hope that the Minister will respond to this—energy prices are still extremely high. We still have not seen a proper windfall tax. There is still enormous pressure on households because of that problem, which will only get worse in winter, in the colder months. It might not seem immediate to some people, but it will be a huge challenge for many residents facing enormous costs. Many people in this country still live in poorly insulated properties. In the area that I represent, we have a very large number of terraced houses, as do many British cities and towns of a similar size, such as Derby and Portsmouth; so do London boroughs, and other areas in the north of England. Much of that housing stock is poorly insulated. That is a hugely important related problem, and I hope that the Minister can update us on the Government’s action. So far, they have been woeful on that point. A series of problems has not been addressed by either the coalition Government or Conservative Governments.

17:06

[David Linden (Glasgow East) (SNP)]

It is a great pleasure to see you in the Chair, Sir George. I, too, congratulate the hon. Member for Slough (Mr Dhesi) on securing the debate. It is one of those hour-long debates where I come along and wonder how many people will be in attendance. It would be fair to say that it has been a well-subscribed debate, hence the need for a time limit. I am only sorry that the only two Conservatives present are here because they are mandated to be. I would have thought that in-work poverty might have meant a little more than that.

We can look at a number of issues when we consider in-work poverty. People will say that it is incredibly complex. In reality, it happens because people do not have enough money. That is the brutal reality. We do not have a real living wage in this country; we have a con trick. The Government talk about their national living wage, but it is not a real living wage. It also appears, bizarrely—I pressed the hon. Member for Slough on this point—that the two main parties are not of the view that the national pay review body’s recommendations should be implemented. That is deeply worrying; for many of those same staff we clapped during the pandemic, that talk will seem like hollow words if we do not back those recommendations.

The fact is that staff are struggling. I highlight the plight of members of the Public and Commercial Services Union. My hon. Friend the Member for Glasgow South West (Chris Stephens) does a huge amount with them. The reality is that there are Department for Work and Pensions staff who administer the benefits system in the UK who are being fed by a food bank because of poverty pay in their Department. If that does not shame DWP Ministers, I do not know what will.

The Government could do a number of things to tackle in-work poverty. First, they could look at the woeful rates of statutory sick pay. People have to earn a minimum of £123 a week before statutory sick pay kicks in. The Government should also look at fixing some of the known problems with universal credit, which of course is an in-work benefit. We often hear from the Government about the importance of people working their way out of poverty, but the people I represent, many of whom go out and do a decent day’s work, are in a ridiculous situation. When they go to the supermarket, baby formula is behind the tills because people are stealing it, and butter is security-tagged. That is because people are put in a position where, frankly, they do not have enough money. That comes back to the same problem of in-work poverty.

The Government can talk all they like about the importance of working to get out of poverty, but as we have heard during today’s debate, the biggest problem for people who are in poverty is that they are not being paid enough. I will finish by saying that one of the best ways to tackle in-work poverty is to join a trade union, and to use its leverage in the workplace to get a fair day’s pay for a fair day’s work.

17:06

[Ms Karen Buck (Westminster North) (Lab)]

It is a pleasure to be here under your chairmanship, Sir George. I congratulate my hon. Friend the Member for Slough (Mr Dhesi) on introducing the debate, and on setting out a powerful and well-argued case for action on the scourge of in-work poverty. We also heard excellent contributions from my hon. Friends the Members for Wansbeck (Ian Lavery), for Newport West (Ruth Jones), for Luton South (Rachel Hopkins), and for Reading East (Matt Rodda).

A consistent theme of the debate has been the extent to which the problem of in-work poverty, which has increased over a number of years, has been exacerbated by the cost of living crisis that we have been grappling with over the past year. That is driven by such factors as core food inflation, which is worse in this country than in neighbouring countries; the housing cost crisis, which has been driven by rising mortgages and rents; and a decade of low wage growth.

The Trussell Trust’s figures today, which should shame the Government—should shame any Government—show that the scourge of food insecurity is affecting millions of people. As was said by many hon. Friends, it has been proven that work is not in itself a means of ensuring that people are not food insecure. My food bank, and food banks in the constituencies of my hon. Friends, are reporting unprecedented demand for assistance from people who are working.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Does my hon. Friend want to comment on the fact that work is now not the route out of poverty, as we have heard? Nothing in what the Government propose on in-work progression will make an impact on that.

[Ms Buck]

I will touch on that in a second. We all want to see people in good, well-paid work. The fact that work is not a route out of poverty has been proven amply in recent years, and more so than previously, but I would also say that work in itself is not necessarily a route out of poverty for people bringing up children. It has always been, and remains, the case that Government have a role to play in ensuring that working families, including those with children, receive support, and that that is not simply left to wages.

The story of in-work poverty over the last 13 years is one of wasted opportunity. One of the most underappreciated social changes of recent decades is the decline in family worklessness. When Labour came into government in 1997, one in five children were living in a workless household. On the most recent data, 9% of children are in workless households. The decline in family worklessness has been an almost continuous trend, outside of economic downturns, over the last two or more decades. There are not only far fewer children in workless families than there were a generation ago, but more couple families in which both adults are working, and fewer in which only one parent works. All those changes should be positive for poverty reduction.

“Work is the best route out of poverty” was always a glib soundbite that dismissed the challenges faced by people who cannot work, whether because of disability, health or caring responsibilities, but it is true that as a general rule parental employment greatly reduces the risk of poverty. On the face of it, then, the employment situation for families with children is incomparably better than it was a generation ago, yet despite continuing improvement in parental employment, child poverty was higher in 2021-22 than it was in 2010-11.

The link between increased employment and poverty reduction broke down somewhere around the middle of the last decade. Some 19% of children in families with someone in work were in poverty after housing costs. By 2019-20, that figure had risen to 26%. It fell back very slightly in the latest data, which are for 2021-22. I suspect that is to do with the boost provided to universal credit and other support during the pandemic.

Astonishingly, the poverty rate after housing costs for children in single-earner families with full-time work is now 44%. Given the changes to employment over this period, had the risk of poverty for working families remained where it was when Labour left office in 2010, we would now be looking at there being far fewer children in poverty. That is what I mean about a wasted opportunity. Just think: the historical record of Conservative-led Governments would be one of poverty reduction. Ministers would be able to proudly defend their record on child poverty. They would not need to switch poverty measures to confuse people. They would be quite happy to be judged on the headline relative poverty measure.

How did this all happen? Faced with employment trends that would have reduced poverty, we had policies that made working and out-of-work families poorer—specifically the benefit freeze, which permanently reduced the value of in-work and out-of-work support. Universal credit was designed around a single-earner household model, and it continues to provide poor rewards for second earners when they increase their hours and earnings. The Government’s response to the weak incentives in universal credit is the crude stick of in-work conditionality. It is virtually an admission that they do not expect second earners to be dramatically better off if they increase their earnings.

For too long, jobcentre policy has been concerned with getting people into any job without considering crucial aspects of job quality such as stability and predictability of earnings and progression. If we want work to be the main route to poverty reduction—and we do—for those who can work, it needs to be work where people can genuinely improve their incomes over time, rather than struggle with zero-hours contracts, unpredictable shift patterns and fluctuating earnings.

The lesson is that increasing parental employment is a necessary but not sufficient condition for reducing child poverty. If we want to reduce poverty, we need a genuinely supportive welfare state and a focus on job quality. These have been the missing ingredients in Government policy since 2010, leading to the squandering of opportunities for poverty reduction.

17:16

[The Minister for Employment (Guy Opperman)]

It is a pleasure to serve under your chairmanship, Sir George, and I congratulate the hon. Member for Slough (Mr Dhesi) on securing this debate. He and others have raised a number of policy issues that are not in my portfolio, but I will try to deal with them briefly if I can.

In respect of housing, I am not the Housing Minister, but the hon. Member will be aware that in 2022-23, the Government are projected to spend £30 billion to support renters. That is 1.4% of GDP. He may criticise that as an insufficient sum, but it is the highest of any country in the OECD in relation to spending on housing rental support—the next highest is 0.9% of GDP. Clearly, the figure is higher than when we came into office.

The hon. Member’s second point about housing related to the production of homes. We have built 2.2 million additional homes since coming into office. Housing starts are double the number we inherited from the Labour Government in 2010. More homes are meeting decent homes standards, and housing supply is up 10% in the last year for which we have figures. The most recent figures show a 20-year high in the number of new buyers.

On education, the hon. Member specifically raised free school meals. I am not aware that that is Labour Front-Bench policy, but he has the joy of the Back-Bench freedom to roam and create new policy. In any event, it is not even SNP policy. The SNP briefly adopted that, but obviously then parked it in a motorhome, and it has been driven off into the distance of some strange new world of new policy.

[David Linden]

Will the Minister give way?

[Guy Opperman]

Of course I will. I look forward to the hon. Gentleman’s defence of all matters motorhomes and policy.

[David Linden]

I am certainly not going to stray into the Contempt of Court Act 1981, as I am sure the Minister would not either as a former solicitor. Given that he seems to know so much about the free school meals position in Scotland, will he outline to hon. Members when free school meals kick in? I am sure he knows.

[Guy Opperman]

As I indicated, I am not the Education Minister, but what I am going to do is set out the position. I will happily make the point that this is not Labour party policy. It used to be, as I understand it. Labour proposed universal free school meals, but recently said that it would need to target that—in other words, it would need to make that means-tested.

[Ruth Jones]

Will the Minister give way?

[Guy Opperman]

No, I am trying to answer this particular point. The reality of the situation on free school meals—[Interruption.] Hon. Members may chunter away as much as they like, but I am going to try to set this out. On free school meals, under the benefits-based criteria, which I believe is what the SNP Government wish to use, 2 million of the most disadvantaged pupils are eligible for and claim a free school meal. That is 23.8% of all pupils in state-funded schools. The number eligible for free school meals has increased since 2016-17 from 1.128 million to 2.019 million. Almost 1.3 million additional infants enjoy a free healthy and nutritious meal at lunchtime, following the introduction by this Government —to be fair, in the coalition—of the universal infant free school meal policy in 2014. This Government have extended eligibility more than any other. Taken together, we spend more than £1 billion per annum delivering free lunches to the greatest ever proportion of schoolchildren —to more than one third of schoolchildren.

I will move away from those particular policies, because the hon. Member for Wansbeck (Ian Lavery) raised a couple of points that I want to address. He was very critical of the Prime Minister, and it is perfectly his right to be so. The Prime Minister is a gentleman of wealth now, but the hon. Gentleman should remember that he is the son of a pharmacist and a GP, who grew up in Southampton.

The hon. Member also talked about his constituency. He will be aware that I set up the Northumberland Community Bank in Ashington in his constituency. The bank is the fastest growing credit union in the north and is, without a shadow of a doubt, doing amazing work in providing support for loans to local people in Northumberland. I say respectfully that that is an amazing institution, which I hope he supports.

[Ian Lavery]

Will the Minister kindly inform the House what those last remarks have to do with this debate?

[Guy Opperman]

The hon. Gentleman raised issues about support for working people. The Northumberland Community Bank is a fantastic institution that provides savings and loans to those in difficulties. It is a co-operative, which I am sure he supports; it was set up in Northumberland; it is a success story; and it is based in his constituency. I will move on.

The Government’s support is underpinned by the wider welfare system, and I will try to set out some particular points on that. In 2023-24, we will spend around £276 billion through the welfare system in Great Britain, including £124 billion on people of working age and their children. Benefit rates and state pensions have increased by 10.1% for 2023-24 and the benefit cap has increased by the same amount. The reality of the situation is that this country has never spent as much as it presently does on this support.

[Debbie Abrahams]

Will the Minister give way?

[Guy Opperman]

I am going to make some progress. [Interruption.]

[Sir George Howarth (in the Chair)]

Order. I do not want to be unkind to the hon. Lady, but in the previous debate, I did point out to an hon. Member that to arrive at the end of the debate and intervene is not necessarily the right way to go about things. If she insists, she can, but I just say that. I call the Minister.

[Guy Opperman]

Our commitment to protecting the most vulnerable is reflected in the action that we have taken over the past two years as people continue to face cost of living pressures, which are clearly evident and are fundamentally derived from the impact of the covid pandemic and the subsequent war in Ukraine, and the impact of that on energy and other costs.

Overall, in 2023 and 2024, we are providing total support worth more than £94 billion to help people with rising bills. That is an average of more than £3,300 per household. Last year, we made cost of living payments of up to £650 to over 8 million low-income households. This year, eligible households will continue to receive additional payments of up to £900. The first £301 payment to 8.3 million households—this support is worth more than £2.5 billion in total—has recently been paid. Further payments will be made this year. In addition, over 6 million people across the UK on eligible extra cost disability benefits have been paid a further £150 disability cost of living payment.

The practical reality is that we have made progress. In 2021-22, 1.7 million fewer people were in absolute poverty after housing costs than in 2009-10, including 400,000 fewer children. Furthermore, there are now nearly 1 million fewer workless households than in 2010. That is why, with more than 1 million vacancies across the UK, our focus is firmly on supporting people in work, and our core jobcentre offer provides a range of options, including face-to-face work coach support and help to boost interview and employment skills.

The taper has been changed, which I believe is very much of assistance. We have taken decisive action on making work pay by cutting the universal credit taper from 63% to 55% and by increasing the universal credit work allowance by £500 a year, allowing households to keep more of what they earn. The national living wage has increased by a record level of 9.7% to £10.42 per hour from this April, which represents a rise of more than £1,600 in the gross annual earnings of a full-time worker.

To help people to progress, we are extending the support offered by our jobcentres to low-paid workers, so that they can increase their hours and move into better-quality jobs. There are two key measures: the in-work progression offer and the increase in the administrative earnings thresholds in universal credit. The in-work progression offer is now live across all jobcentres in Great Britain. We estimate that about 1.4 million low-paid claimants are eligible for work coach support.

I am conscious of time, and I want to address a key issue. Legitimate points were made on the cost of living and earnings, but I am pleased that, today, the Department for Work and Pensions raised the amount that working parents on universal credit may claim for childcare. This is up to £951 a month for one child and £1,630 for two or more children. That is an increase of approximately 47% on the previous limits, which were £646 and £1,108 respectively. That is a massive increase in childcare support for working parents and of massive assistance to those who work. I hope that the House will welcome that.

The Government are also helping eligible parents to cover the costs for the first month of childcare when they enter work and as they increase their working hours. In addition, the House will be aware of the expansion of the 30 hours of funded childcare that the Government originally introduced in 2017, extending the entitlement to eligible working parents for children aged from nine months old to when they start primary school. That will remove one of the largest hurdles that working parents face by giving a huge boost to the amount of funded childcare that they can access, saving them about £6,500 a year.

Taken collectively, we have heard loud and clear that there is a need for a better amount of support for this particular childcare. In respect of this point, we will provide £204 million of extra funding for local authorities to increase the hourly rates that they pay providers, and make sure that rates continue to go up each year.

The Government are committed to tackling poverty, both in and out of work. We are focusing on making work pay and on progression opportunities. We will ensure that everyone has the opportunity to move into a job where they can realise their potential.

17:27

[Mr Dhesi]

Thank you, Sir George, for chairing today’s important debate on in-work poverty. I thank the Minister, the Labour shadow Minister, my hon. Friend the Member for Westminster North (Ms Buck), and the SNP spokesman, the hon. Member for Glasgow East (David Linden), for their responses, as well as other hon. Members who made such sobering, excellent contributions in speeches and interventions.

My gratitude also goes to the House of Commons Library for providing accurate and relevant statistics. I thank Crisis, the Trussell Trust, the Joseph Rowntree Foundation and Slough food bank for providing their analyses, as well as for the brilliant work that they do in my Slough constituency and across our country.

Ministers may want something to blame, whether that is covid, the war in Ukraine or the energy crisis, but the truth is that in-work poverty has been caused by low and insecure earnings, a high cost of living and little affordable housing. As my hon. Friends have eloquently explained, the problems are worse for marginalised communities, especially for many in ethnic minority communities.

All three of the problems that I have highlighted are consequences of Government incompetence and ideology. All three have led to stagnation and suffering. According to Crisis, one in four households who became homeless in 2022 had at least one person in work. The crisis of in-work poverty is leading to a crisis of in-work homelessness, caused by a toxic mix of low-paid, insecure work and a lack of affordable housing. That is why we have a situation in our country where many people are going into work without having a home to return to. We must be in a position whereby people in our country—or in any country—should be able to aspire to a decent wage, to own their own home and to raise and support a family. The Government must ensure that people can aspire to do more than merely survive—

17:29

Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14)).