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Speaker’s Statement
(4 months ago)
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Mr Speaker
Before we begin today’s proceedings, I would like to remind hon. Members of what I said last week following the King’s Speech. The language we use in the Chamber, and the way we behave towards each other, should reflect the principle that good temper and moderation are the hallmarks of parliamentary language and behaviour.
I am determined that Members in all parts of the House should be treated with courtesy and respect in this Chamber. I remind the House that it is entirely at the discretion of the hon. Member who has the Floor to choose whether to give way. And once it is clear that the Member does not wish to give way, colleagues should not persist in asking them to do so.
I should also like to remind Members about the church service tomorrow to mark the start of the new Parliament. You will all have received information about it and I look forward to seeing those of you who are able to attend.
NATO and European Political Community Meetings
(4 months ago)
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The Prime Minister (Keir Starmer)
Before I start my statement, I would like to pay a short tribute to President Biden, a man who, during five decades of service, never lost touch with the concerns of working people and always put his country first. A true friend of the Labour movement, his presidency will leave a legacy that extends far beyond America, to freedom and security on this continent—most of all, of course, in our steadfast resolve to stand by the people of Ukraine. He leaves the NATO alliance stronger than it has been for decades.
With permission, Mr Speaker, I would like to update the House on my recent discussions with leaders around the world, including at the NATO summit and at the meeting of the European Political Community last week at Blenheim Palace, the biggest European summit in the UK since the war.
Mr Speaker, the House knows the significance of Blenheim Palace, the birthplace of Winston Churchill—the man who steered the march of European history towards democracy and the rule of law. It was a shared sacrifice for freedom—the blood bond of 1945. At both summits, we reaffirmed our commitment to that bond of security and freedom, as I am sure we do in this House today. NATO is the guarantor of those values, and that is more important than ever, because, today in Europe, innocent lives are once again being torn apart. Two weeks ago today there was an attack on a children’s hospital in Kyiv—children with cancer the target of Russian brutality.
Russia’s malign activity is not confined to Ukraine. In the Western Balkans, in Moldova and in Georgia, it is sowing instability. And let us not forget that it has targeted people on our streets and attempted to undermine our democracy. In the first days of this Government, I have taken a message to our friends and allies of enduring and unwavering commitment to the NATO alliance, to Ukraine and to the collective security of our country, our continent and our allies around the world. That message was just as relevant at the EPC last week. May I take this opportunity to thank the Leader of the Opposition, who brought that event to our shores in the first place?
At these meetings, I took a practical view of how the UK can meet this moment, driven not by ideology but by what is best for our country. That includes resetting our relationship with the European Union, because on these Benches we believe that the UK and the EU, working together as sovereign partners, are a powerful force for good across our continent. That has been my message throughout the many conversations that I have had with leaders in recent days, because countries want to work with Britain—of course they do. They welcome renewed British leadership on security, on illegal migration and on global challenges such as climate change. Our voice belongs in the room, centre stage, fighting for the national interest.
My conversations have focused on issues on which the British people want action, so I would like to update the House on my discussions in three specific areas. The first is European security. In Washington, I told NATO allies that the generational threat from Russia demands a generational response. That is why my right hon. Friend the Chancellor of the Exchequer will set out a clear path to spending 2.5% of our GDP on defence. It is also why I launched a strategic defence review, led by the former NATO Secretary-General Lord Robertson, to strengthen our armed forces and keep our nation safe.
I also took the opportunity at the NATO summit to confirm that we will deliver £3 billion-worth of military aid to Ukraine each year for as long as it takes. And together we confirmed Ukraine’s irreversible path to full NATO membership, because it is clear to me that NATO will be stronger with Ukraine as a member—something I reiterated to President Zelensky in person in Downing Street on Friday.
Secondly, I want to turn to the middle east, because that region is at a moment of grave danger and fragility. I have spoken to leaders in the region and allies around the world about our collective response. How can we deal with the malign influence of Iran, address its nuclear programme, manage the threat from the Houthis, ease tensions on Israel’s northern border, and work with all partners to uphold regional security?
Fundamental to that, of course, is the conflict in Gaza. I have spoken to the leaders of Israel and the Palestinian Authority. I have been clear that I fully support Israel’s right to security and the desperate need to see the hostages returned. I have also been clear that the situation in Gaza is intolerable, and that the world will not look away as innocent civilians, including women and children, continue to face death, disease and displacement. Mr Speaker, it cannot go on. We need an immediate ceasefire. Hostages out, aid in; a huge scale-up of humanitarian assistance. That is the policy of this Government, and an immediate ceasefire is the only way to achieve it, so we will do all we can in pursuit of these goals. That is why, as one of the first actions taken by this Government, we have restarted British funding to the UN Relief and Works Agency, to deliver that crucial humanitarian support.
We received the International Court of Justice opinion on Friday and will consider it carefully before responding, but let me say that we have always been opposed to the expansion of illegal settlements and we call on all sides to recommit to stability, peace, normalisation and the two-state solution: a recognised Palestinian state—the right of the Palestinian people—alongside a safe and secure Israel.
Thirdly, I want to turn to illegal migration. This issue has now become a crisis, and in order to tackle it we must reach out a hand to our European friends. We started that work at the EPC, agreeing new arrangements with Slovenia and Slovakia, deepening co-operation across Europe for our new border security command, and increasing the UK presence at Europol in The Hague, to play our full part in the European Migrant Smuggling Centre. The crisis we face is the fault of gangs—no question—but to stop illegal migration we must also recognise the root causes: conflict, climate change and extreme poverty. So I have announced £84 million of new funding for projects across Africa and the middle east, to provide humanitarian and health support, skills training, and access to education, because the decisions that people take to leave their homes cannot be separated from these wider issues.
We will work with our partners to stamp out this vile trade wherever it exists and focus on the hard yards of law enforcement with solutions that will actually deliver results. I have seen that in action, tackling counter-terrorism as Director of Public Prosecutions, and we can do the same on illegal migration. But let me be clear: there is no need to withdraw from the European convention on human rights. That is not consistent with the values of that blood bond, so we will not withdraw—not now, not ever.
The basic fact is that the priorities of the British people do require us to work across borders with our partners, and a Government of service at home requires a Government of strength abroad. That is our role. It has always been our role. Britain belongs on the world stage. I commend this statement to the House.
Rishi Sunak (Richmond and Northallerton) (Con)
I thank the Prime Minister for advance sight of his statement and join him in praising President Biden for his long career of public service both at home and abroad. Working together, we took our AUKUS partnership to the next level, supported Israel after the terrible events of 7 October, defended our countries from the Houthi threat and led global efforts to support Ukraine as it resisted Russia’s assault. On a personal level, it was a pleasure to work with him to strengthen the partnership between our two countries, and I wish him well.
As the Prime Minister indicated, the world is increasingly uncertain—the most dangerous it has been since the end of the cold war. Russia continues its illegal and brutal invasion of Ukraine. Iran continues with its regionally destabilising behaviour. Both Iran and North Korea are supplying Russian forces in Ukraine as we speak, and China is adopting a more aggressive stance in the South China sea and the Taiwan strait. Together, that axis of authoritarian states is increasingly working together to undermine democracies and reshape the world order.
In those circumstances, our alliances take on ever-greater importance. I commend the Prime Minister on his work with our closest allies at both the NATO summit in Washington and the European Political Community meeting at Blenheim. Across this House we built a strong consensus on foreign policy in the last Parliament, which has stood our country in good stead in this transition. Our allies, particularly Ukraine, know that although our Government have changed, Britain remains an active, involved and reliable partner.
I am glad that the Prime Minister also shares our view of the value of the EPC community as a forum. I am pleased by and welcome the fact that he used the summit to discuss illegal migration, because it is one of the most pressing problems facing our entire continent. When it comes to illegal migration, we all face the same fundamental question: how to deal with people who come to our countries illegally while respecting our international obligations.
Of course, it is not feasible or right to return Afghans to the Taliban, Syrians to Assad or Iranians to the ayatollahs, but nor can our country accommodate everyone who would like to leave Afghanistan, Syria or Iran and come here. I was pleased to hear the Prime Minister say that he was a pragmatist and that he would look at what works when it comes to squaring that circle. I urge him, in his conversations with other European leaders, to keep the option of further third-country migration partnerships on the table, as other countries have been discussing.
I know the Prime Minister is also interested in pursuing a security and defence co-operation pact with the European Union, and here I just urge him to be alert to the trade- offs involved. I hope he can reassure the House that any closer co-operation with the EU will not adversely affect the technological and procurement aspects of our other alliances such as AUKUS. Of course we are a pillar of European security, as our leadership on Ukraine has shown, but we also have alliances and interests that extend beyond the European continent.
Turning to the NATO summit, it was good to see the alliance reaffirming its commitment to Ukraine, with the UK at the heart of that leadership. I hope the Prime Minister will keep the House updated on how the new unit to co-ordinate our collective support to Ukraine will indeed lead to an increase in vital support. I urge the Prime Minister to continue stressing to our allies that now is the moment to increase, not to pare down, our backing for Ukraine, as the UK has continued to lead in doing.
In the 75 years of its existence, NATO has established itself as the most successful defensive alliance in history. The best way to strengthen the alliance is for its non-American members to do more, to show that we do not expect the Americans to bear every burden, and I welcome the Prime Minister’s indication that the Chancellor will soon set out a clear path to investing 2.5% of GDP in our armed forces—I hope by 2030. That would both show the Americans that the other members of the alliance are serious about boosting our own capabilities, and show President Putin and our adversaries that we are serious about defending our borders and allies from Russian or any other aggression.
The Prime Minister also spoke about the situation in the middle east. We all want to see progress towards a two-state solution where Israelis and Palestinians can live side by side in peace, prosperity and security. However, as we make progress towards that goal, our friend and ally Israel must have the right to defend itself against the threat that it is facing—a threat demonstrated by the drone strike on Tel Aviv at the end of last week by the Iranian-aligned Houthi rebels.
In conclusion, I thank the Prime Minister for coming to update the House today. I can assure him that we on the Opposition Benches will work with him on these questions of foreign policy and national security. We will ask questions, probe and push for answers—that is our duty as the official Opposition—but we will always act in the national interest and work constructively with him to ensure the security of our country.
The Prime Minister
I thank the Leader of the Opposition for his welcome comments in relation to President Biden, which I am sure will be well received, and for what he said about the consensus on foreign policy in relation to NATO and the EPC. That is important, and I am glad that we have managed to get that consensus over recent years, because we are in a more volatile world, and the world is looking in to see unity in the United Kingdom, particularly in relation to Ukraine. I have commended the role of the previous Government in relation to Ukraine, and I do so again. I took the deliberate decision when I was Leader of the Opposition not to depart on Ukraine, because I took, and continue to take, the view that the only winner in that circumstance is Putin, who wants to see division. It is very important for Ukraine to see that continued unity across this House.
We will of course work with others. In relation to the point made by the Prime Minister—[Interruption.] Old habits die hard. On the point made by the Leader of the Opposition about security and co-operation with our EU allies, I do believe that is to our mutual benefit, but I can assure him and the House that it does not cut across, or come at the cost of, other alliances. We are fully committed to AUKUS—as I made clear in opposition, and I take this early opportunity to affirm it in government—because it is an area on which there is an important consistency across the House.
In relation to the conflict in Gaza, the more that we in this House can be united, the better. It is an issue of great complexity, but the approach that has been shown is the right one, and we take it forward in that spirit.
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
I congratulate the Prime Minister on his flying start on the world stage, and on his determination to build not simply a rules-based order, but a rights-based order rooted in what Churchill called the great charter and we call the European convention on human rights. We want its freedoms and liberties to be enjoyed by the people of Ukraine, but that will take victory over Russia. It will need more than courage; it will need resources. Did he discuss with international colleagues the need not simply to freeze Russian assets, but to seize and put them to work in defeating once and for all the tyranny of President Putin?
The Prime Minister
I thank my right hon. Friend for that question on the centrality of the Ukraine issue. Yes, of course, that requires resource and more pressure in relation to sanctions, but it also requires resolve. A key issue coming out of the NATO council in Washington was the real sense, particularly in relation to Ukraine, of a bigger NATO—with more countries than ever at the council—a stronger NATO, and a unity of resolve in standing up to Russian aggression, particularly in Ukraine. Resources and sanctions were central to the agenda there.
Ed Davey (Kingston and Surbiton) (LD)
I thank the Prime Minister for advance sight of the statement. Closer co-operation with our European neighbours is absolutely essential, whether on Russia’s illegal war against Ukraine or on tackling the criminal gangs responsible for the small-boats crisis, and I welcome the new Government’s change in approach. I also welcome their support for an immediate ceasefire in Gaza. Clearly, we need to put an end to the humanitarian devastation there, get the hostages home, and open the door to a two-state solution. Upholding international law is also crucial. To that end, I hope the Government will respect last week’s ruling of the ICJ when they consider it.
On the NATO summit, 70 years on from the foundation of NATO, the alliance has never been more relevant. We support the NATO summit pledge of long-term security assistance for Ukraine, as well as increased support now to ensure she can resist Russia’s attacks and liberate her territory. I am pleased that, in this new Parliament, this House will continue to stand united behind the brave Ukrainians opposing Russia’s illegal war, just as we have done together in recent years.
However, I hope Members of this House will not be complacent about the impact that the upcoming US elections could have, not just on the security of the UK and our allies, but on the security of Ukraine. We must hope that the leadership of President Biden continues with his successor—I echo the Prime Minister’s tribute to President Biden—but whatever happens in the US, part of the answer is for the UK and Europe to increase defence spending. The previous Conservative Government have left a legacy of the smallest Army since the age of Napoleon and played fast and loose with public money, making our shared ambition to spend 2.5% of GDP on defence a much more complicated route. We look forward to the Chancellor of the Exchequer’s plan. I hope this Government will start by reversing the planned cuts to the Army of 10,000 troops. That is a vital first step, so will the Prime Minister reassure the House and the country that it will be a priority within the recently launched strategic defence review?
We also urge the Government to move further and faster in taking steps to seize frozen Russian assets, of which there are £20 billion-worth on our shores and the same amount on the continent. I hope the Prime Minister recognises that we have an opportunity to lead within Europe on this vital issue: if the US cannot, Europe must.
The Prime Minister
I thank the right hon. Gentleman for raising those three issues. On the international courts, we respect the independence of the Court and international law—let me be very clear about that. I will not get tempted by questions about the US elections later this year, save to say that it will obviously be for the American people to decide who they want as their President, and as Members would expect, we will work with whoever is the President after they have made their choice. I take the right hon. Gentleman’s point about the low numbers of troops, which will be looked at in the strategic defence review that we are carrying out into threats, capability and resources.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
It was incredibly pleasing to see the Prime Minister both at NATO and welcoming leaders from across our continent to Blenheim palace, at a historic moment for a reset with Europe after the disastrous legacy that the departing Government left behind. Did the subject of youth mobility for students and suchlike arise, and could his Government look into repairing it for its soft power, cultural exchange and growth-boosting properties that have been so valued, as we are now in a post-Erasmus era?
The Prime Minister
I thank my hon. Friend for her question. The reset with our European allies was well received, and there was clearly an appetite to work in a different and better way with the UK, which I think will stand us in good stead as we go forward. We did have discussions about a closer relationship with our EU allies, but I made it very clear from the outset—as I have done in opposition—that that does not mean rejoining the EU, it does not mean going back into the structures of the EU, and it does not mean freedom of movement. I took the early opportunity to make that clear to our European allies so that we can move forward progressively, but with the right framework in mind.
Sir Julian Lewis (New Forest East) (Con)
May I congratulate the Prime Minister on his election victory, and particularly on the very strong commitment he gave at the beginning of his campaign to the maintenance of the strategic Trident nuclear deterrent in the future? Does he agree that, if there had existed in 1914 or in 1939 an organisation like NATO that committed America to the protection from day one of countries such as Belgium in the one case or Poland in the other, those two terrible conflicts might well never have broken out? Does he therefore share my concern that the virus of isolationism is again on the move in certain parts of the American political spectrum?
The Prime Minister
I thank the right hon. Member for that question. First, I was able to make clear our unshakeable commitment to the nuclear deterrent, something I did in opposition. I have been able to make that absolutely clear as Prime Minister, and it was very important that I did so from the outset. In relation to what may have happened in the past, I will not speculate, but I believe that NATO is the most successful alliance the world has ever known, and that it is as needed now as it was when it was founded. The then Labour Government were very proud to be a founder member of NATO, and it was very important for me to reaffirm our unshakeable support for NATO. The world is a more volatile place, the challenges are greater now than they have been for many years, and I think that NATO is as needed now and as relevant now as it has ever been in its history.
Rachael Maskell (York Central) (Lab/Co-op)
I congratulate my right hon. Friend the Prime Minister on the leadership he showed not just at NATO, but at the European Political Community. Working together and collaborating are important, not least in the unstable world that we are in. Could he set out what discussions he had about the EU-UK trade and co-operation agreement in the light of its renegotiation deadlines next year?
The Prime Minister
I was able to have early discussion about the EU-UK trade arrangements of a preliminary sort. There is an appetite for that discussion—no one pretends that it is an easy discussion—and I am pleased to have appointed a Minister, the Paymaster General and Minister for the Cabinet Office, who will take responsibility for that important work. It does not involve rejoining the EU; it does involve resetting and improving the relationship we have with our EU allies.
Sir Julian Smith (Skipton and Ripon) (Con)
Can I, first, congratulate the Prime Minister on his election win, and wish him the very best in his new role? Building on the last question, the EPC summit seemed very positive. How does he see using this political locus to get the UK in the best possible position for the renegotiation of the TCA in 2026?
The Prime Minister
I thank the right hon. Member for his comments. There is an appetite now for a different discussion about our future relations with the EU—whether that is trade, education and research, or security co-operation. Particularly in the light of what has happened in Ukraine, there is a shared sense that there is room for closer work and closer ties there. They are the three main areas. It is at the very early stages, but the reset was well received by many European allies, and I was pleased to have that early opportunity to set out our case.
Paul Waugh (Rochdale) (Lab/Co-op)
The Prime Minister’s statement will be warmly welcomed by the people of Rochdale, particularly the Ukrainian community, which has flourished in our town for nearly 80 years. So can I pass on to him a direct message from Olga Kurtianyk, who is the chair of the Rochdale branch of the Association of Ukrainians in Great Britain, who told me yesterday that she is very grateful for the Prime Minister’s continued support for President Zelensky in the fight against the illegal war that Putin has waged?
The Prime Minister
I am very pleased to hear that, and to be able to make that clear commitment. But I want to emphasise that this is the continuation of the work of the previous Government, which we fully supported before and fully support now. What is also important for our communities, and certainly important for the international community, is to see the unity that we have been able to maintain here in this Chamber. The world watches in relation to our unity and it is important therefore that we maintain it as we go forward.
Stephen Gethins (Arbroath and Broughty Ferry) (SNP)
May I also add my personal congratulations to the Prime Minister on his election win?
The international rules-based system is the cornerstone of peace and security. The Prime Minister talks of a ceasefire in Gaza and the application of the rule of law. What measures is he willing to take to make sure that is implemented? Furthermore, being outside the EU makes us less safe. The populists who want us to turn away from the EU and towards Trump-style isolationism are playing straight into Putin’s hands, so what are we doing to get closer to the EU?
The Prime Minister
In relation to a ceasefire, obviously talks are under way at quite an advanced stage and we have already urged all sides in the international discussions that I have had to move forward on a ceasefire, because without a ceasefire it is very difficult to envisage the circumstances in which further hostages can come out safely and aid can go in at the scale that is desperately needed. Also, a ceasefire can be a foot in the door for the beginning of a process, however remote it may seem at the moment, to a two-state solution. In relation to the EU, we have a shared interest in safety and security with our EU allies and that was very much the topic of discussion we had at the EPC summit last week.
Josh Simons (Makerfield) (Lab)
For my constituents in Makerfield, restoring control over our borders is a key issue of concern. It has become a matter of public trust. Does the Prime Minister agree that the new border security command is an opportunity to show how the UK can play a leading role in tackling criminal smuggler gangs?
The Prime Minister
Yes I do, and the command is based on the work I did as Director of Public Prosecutions, working with law enforcement and security and intelligence sharing with our allies—in the cases I was working on to deal with counter-terrorism. I have never accepted the argument that the only gangs that apparently cannot be taken down using the same techniques are the gangs running this vile trade. There was real interest in what we were saying at the EPC summit last week and an understanding that, if we share intelligence, data, strategy and approach, we can all do more to bring down these vile gangs.
Sir John Whittingdale (Maldon) (Con)
I welcome the Prime Minister's reiteration that the UK remains the strongest supporter of Ukraine against Russian aggression, but what support can we also give to another former Soviet state, Armenia, both in resolving its conflict with Azerbaijan, and in pursuing its ambition to move closer to NATO and the European Union in the face of Russian threats and intimidation?
The Prime Minister
I am grateful for that question. This came up in the discussions last Thursday, as would have been expected, with a joint resolve to provide the support and framework needed for peace and security across the entire region. Again, there is a shared intent with our allies to work together on this because it is of such importance. I thank the right hon. Gentleman for raising it.
Fred Thomas (Plymouth Moor View) (Lab)
I am one of 12 newly elected Members on this side of the House who have served in the armed forces, and in Plymouth so many of my friends and neighbours have served as well. All of us are deeply concerned by the ongoing illegal invasion and inhumane, increasingly barbaric, tactics Russia is using. Will the Prime Minister agree with me that in an uncertain world one thing we can be sure of is that Ukraine has no firmer friend than the UK?
The Prime Minister
Yes, I can confirm that and emphasise just how important it is. We had the honour of hosting President Zelensky at Downing Street on Friday, where I was able to make that clear, and again to take the opportunity to say that we are building on the work of the previous Government, not departing from that work. I think the support of the UK in particular to Ukraine has been leading, important and provided at difficult times, which has often led to others moving in accordance with the moves we have made as a country. President Zelensky is grateful for the role we have played in the past and that we continue to play now.
Dr Caroline Johnson (Sleaford and North Hykeham) (Con)
My constituents in Sleaford and North Hykeham are very concerned about levels of illegal migration, particularly people crossing the channel. I was pleased to hear the Prime Minister say that he wants to tackle it. He mentioned two measures: £84 million to tackle root causes and the focus, which is arguably already present, from law enforcement. In the last seven days, 1,500 people crossed the channel. How many of them would he expect to have been deterred by the measures he describes?
The Prime Minister
This is a real problem that we have inherited because not enough attention has been paid to border control in my view. Record numbers have come this year. The measures taken by the last Government were patently not working, so we need to address that. That is why we have taken early steps to set up the border security command. It is also why we have already moved more staff into the returns unit, so it can get on with the job of actually returning those who have no right to be here. One hundred staff have moved already in the early days of this Government, but we have to recognise that we also need to address the reasons that people move in the first place, which are very much to do with conflict, poverty and climate change. If we ignore those upstream causes, we will never fully get to grips with the problem that is so obvious to so many people in this country.
Andrew Lewin (Welwyn Hatfield) (Lab)
I thank the Prime Minister for his statement, and I thank him particularly for his commitment to resetting our relationship with the European Union. It is regrettable that the deal signed by the Opposition when they were in government did real damage to our economy. It put up barriers to trade with the European Union and increased red tape. Does the Prime Minister agree that now is the time for a new relationship and to take practical measures, such as the mutual recognition of professional qualifications, to increase our alignment with the European Union, so we can help our services and get our economy moving again?
The Prime Minister
I do not think the deal we have is good enough. If we talk to any business that deals with the EU, they complain it is not good enough for them and has made trade harder, not easier, and that is a real problem. We can do better than that. The EPC was an early opportunity for us to reset our relationship and begin progress towards that better relationship, whether that is in relation to trade or defence and security, which are both very important to us.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
I welcome that the Prime Minister says that there is an appetite for a reset in our relationship with our European neighbours. A core element of collective European security is collective economic security. He knows that being outside the single market and the customs union has cost the UK economy almost £140 billion. How will he remedy this toxic Tory legacy by continuing to refuse even to consider rejoining those economic structures?
The Prime Minister
I think the relationship can improve. We can have a better relationship, but I do not think we can simply ignore the referendum and go back into the EU. In the discussions I had with our European allies, none of them was urging us to take that course. They were interested in the argument we were making about a better relationship and how that could work in relation to trade, education and security and defence. That is why I wanted to be clear from the outset about our approach.
Joe Morris (Hexham) (Lab)
The Hexham constituency, as the Prime Minister will know, is home to the Otterburn ranges, which have played a key role in training our armed forces for decades. What steps will the Prime Minister take to improve the working relationship between our armed forces and those of our NATO allies?
The Prime Minister
Our armed forces provide huge resource to NATO, particularly in Europe, and across our armed forces we are fully committed in almost every respect to NATO. There is huge room for further such work, building on what is clearly working already.
Kit Malthouse (North West Hampshire) (Con)
The Prime Minister has given us fine words about the importance of our membership of international institutions, particularly international courts, and I agree with him—it is profoundly in our national interest that we are a member of these organisations—but he will know as well as I that those courts are only as good as the action and consequence that flow from their judgments. Without action and consequence, their judgments just become hot air. In relation to Israel-Gaza, and in particular the occupation of the west bank, can he please assure us that he is considering hard consequences for the very obvious flagrant breach of international law that is taking place daily in that part of the world?
The Prime Minister
I am grateful for that question, because I believe in international law and I think it is very important that we keep to our commitments on international law. We are known for that as a nation, and it matters to the world. In relation to the courts, I respect their independence. Obviously, we will have robust discussion about particular actions, judgments that they might publish, and decisions that they come to, but for those who believe in international law, it is important to be equally clear that we support the independence of the courts. Without that anchor, we do not have the framework that is so important to us, in terms of enforcing international law.
Adam Jogee (Newcastle-under-Lyme) (Lab)
I welcome the Prime Minister’s statement and very much echo his words about President Biden. Does the Prime Minister agree with me and the people of Newcastle-under-Lyme that the only way to stop illegal migration and the subsequent tragic loss of life is by our United Kingdom working more closely with our European neighbours to smash the gangs who run this vile trade?
The Prime Minister
Yes, I do. We have already been able to put further resource into Europol. Last Thursday, we had a very live discussion about sharing data and intelligence, and about an overarching strategy on prosecutions, with our European allies, who were keen to learn more about what we were proposing, and how they could play their part with us to smash the gangs; because the gangs operate across borders, that can be done only in conjunction and collaboration with our EU partners.
Richard Foord (Honiton and Sidmouth) (LD)
The last Government spent quite some time engaging with isolationists in Washington. They sought to influence conservative think-tanks in the US that are listened to by Republicans, such as the Heritage Foundation. I appreciate the Prime Minister’s point that it is for the American people to decide who governs them later this year, but what more can his Government do to stress to Republicans, and to candidate Trump, that European and American security are indivisible?
The Prime Minister
On the first part of the question, luckily I do not answer for the last Government; I answer for this Government. We will work with whoever the American people elect as President, but specifically on the question, the special relationship between the UK and the US was forged in the most difficult of circumstances and has endured for many years, and it is important both to the US and to the UK to maintain that special relationship. I have had an early opportunity to make my position clear on this. Again, it is a continuation of the position of the last Government: that special relationship matters to us, whoever ends up being the President of America.
Sally Jameson (Doncaster Central) (Lab/Co-op)
Does the Prime Minister agree that we need a “NATO first” defence policy in the face of growing Russian aggression, as seen in Ukraine? Will he join me in paying tribute to the Doncaster Ukrainian Centre in my constituency, which has worked tirelessly around the clock to support Ukrainian refugees, demonstrating the true community spirit of Doncaster?
The Prime Minister
Let me start by joining in that, and making it clear that this work, done in so many communities, is really important, in terms of the support given and the welcome shown to refugees.
The point about “NATO first” is important. As I say, we are proud to have been among the founding members of NATO, and the review that we have put in place has framework principles, one of which is “NATO first”. That will inform the way in which we conduct the strategic review.
Sir Desmond Swayne (New Forest West) (Con)
Why do we continue to limit Ukraine’s ability to take the fight to Russia?
The Prime Minister
The approach to capability taken by the UK remains the same as it was three weeks ago— no different decisions have been taken—and is based on the principle of recognising Ukraine’s right to self-defence and the parameters of international law. I think that is right, and that is why no new decisions have been taken.
John Slinger (Rugby) (Lab)
Does the Prime Minister agree that the strength and unity of purpose expressed by our international alliances is mirrored and enhanced by the solidarity and friendship that the British people have shown by accommodating Ukrainians in this country? Would he join me in praising the work of the Rugby Ukrainian community, and assure me that his Government will continue to support such groups?
The Prime Minister
Yes on both points. A number of months ago, in Swindon, I was struck by the incredible contribution of Ukrainian women, who were leading workshops on businesses and success. On the main point about the attitude of British people, it was good to be able to say to President Zelensky that we have just had an election and we have been all over the United Kingdom, and pretty much wherever we went we saw the Ukrainian flag and people supporting Ukraine, irrespective of party political difference. There was a real sense that the whole country, as well as the Government and the Opposition, support Ukraine and are determined to do whatever they can to stand up to Russian aggression. We should be proud of the fact that we see that right across the country.
Jeremy Corbyn (Islington North) (Ind)
I congratulate the Prime Minister on the office that he has achieved, and thank him for his statement. I am pleased with the decision to remain part of the European convention on human rights. In all his meetings with both the EU and NATO, was the issue of global war considered—not just the wars in Ukraine and Palestine, but those in Sudan, Congo and Yemen—and the possibility of involving the UN much more in looking towards a more peaceful future, rather than continued greater expenditure on arms? I am pleased that the Prime Minister has called for a ceasefire in Gaza, but surely if we are to follow international law we need to go a bit further and call for the withdrawal of Israeli occupying forces both from Gaza and the west bank, and an end to our complicity by supplying arms to Israel.
Mr Speaker
Order. May I say gently to the right hon. Gentleman that I have a lot more to get in today, and as important as his message is, I need to make others heard?
The Prime Minister
Let me deal with both points. First, conflict resolution did come up, because we had a full discussion about illegal migration—the law enforcement aspect of it, as I have explained, and the root causes of migration, conflict, poverty and climate change being key among them. The prospect of a ceasefire is there. I am urging all parties to take that opportunity; it is an important foot in the door for the political process, which I believe is the only process that will bring about lasting peace and resolution in the middle east.
Katie White (Leeds North West) (Lab)
I congratulate the Prime Minister on a very successful set of meetings last week. Does he agree that the shifting relationship with the European Union led by the previous Government has made us economically poorer, and undermines small businesses such as the toy shop in Horsforth in my constituency, which closed? Will he ensure that small businesses and their needs and prosperity will be at the heart of any renegotiation deal in two years’ time?
The Prime Minister
Businesses across the country that deal with Europe feel that the deal that the last Government negotiated is not good enough for them and has made trading much harder. That is why they are encouraging us to reset that relationship and get a better deal—better for our country, our businesses and our economy. Our No. 1 mission in government is to grow our economy, so it is very important to see this in that context.
Sir Geoffrey Clifton-Brown (North Cotswolds) (Con)
I too congratulate the Prime Minister on what was obviously a successful series of meetings last week. He has set out some of his new policies to deal with illegal migration across the channel, and to return illegal migrants from this country. In what sort of timescale could the British people reasonably expect his new policies to start having a real effect?
The Prime Minister
We have taken early measures, because the British people want to see an impact and a difference. They feel very much that in recent years there has been a loss of control of the borders. That is a matter of border security and, actually, national security. That is why we have acted quickly to begin the steps to set up the border security command. It is why we have already begun to put more staff in the returns unit, and taken a decision on the upstream work needed to reduce the likelihood of migration in the first place. They are early steps, and I am not going to put an arbitrary date on that, but I do understand the thrust of the question; this is an area of great importance, where British people want to see a material change in the situation.
Mark Ferguson (Gateshead Central and Whickham) (Lab)
In Gateshead Central and Whickham, and across the north-east, those who have fled Putin’s war in Ukraine want to make the most of their time in our community, but above all they want to know that the British people stand with them, so I thank the Prime Minister for his ongoing support for the people of Ukraine, but can he expand further on Ukraine’s future entry into NATO, which is so critically important?
The Prime Minister
Yes I can, and I am grateful for the opportunity to do so. The North Atlantic Council committed itself to an irreversible path to membership of NATO. That is a material step forward from a year ago and is among the reasons President Zelensky said that the council was a success in relation to membership of NATO. That is why I said what I said in my statement. That path is now irreversible, and that is a good thing, welcomed across the NATO allies.
Greg Smith (Mid Buckinghamshire) (Con)
The level of infiltration by Hamas of the United Nations Relief and Works Agency is well documented—from UNRWA staff taking part in the pure evil that was the 7 October attack, to UNRWA-funded schools being used to store weapons and harbour terrorists, and to terror infrastructure being found under UNRWA’s headquarters in Gaza City. Before the Prime Minister took the decision to re-commit UK taxpayers’ money to UNRWA, what advice did he receive on that infiltration, and what steps has he demanded be taken, so that UK taxpayers’ money can never be used to fund terror or preach hate?
The Prime Minister
As the hon. Member would expect, we took the most careful advice and subjected it to the most careful consideration, because we were concerned, as anyone in this House would be, by the suggestions and allegations in relation to 7 October. We looked at that really carefully, took it very seriously, and gave it the utmost consideration. There has, of course, been an independent review and steps put in place, but there is a vital role for UNRWA. Many other countries have restored funding for UNRWA—it is the right thing to do—but I can give an assurance that the most careful consideration was given before that step was taken, as the hon. Member would expect.
Joe Powell (Kensington and Bayswater) (Lab)
I warmly welcome the announcement that the UK will lead an initiative to crack down on Russia’s shadow fleet of sanctions-evading ships, which is helping to generate dirty money to fund Russia’s war machine. Will the Prime Minister continue to make sanctions enforcement a priority, and update the House on the state of international negotiations on using frozen Russian assets, including those in Kensington and Bayswater, to support Ukraine now?
The Prime Minister
I am grateful for that question. Important progress was made at NATO on sanctions, and it is important for the House to have regular updates, so we can commit to giving the next update as soon as it is appropriate to do so. I think across the House there is a resolve to use sanctions as effectively as they can be used, as one of the weapons in relation to Russian aggression.
Calum Miller (Bicester and Woodstock) (LD)
I hope the Prime Minister enjoyed welcoming fellow European leaders to Blenheim Palace in my constituency. One of my constituents, Rose, is studying Spanish and French at Southampton University. She would like to spend her year abroad working in Spain to strengthen her language skills and improve her employment prospects, yet as it stands she has no right to work there. I hope the Prime Minister saw the benefit of working with his European counterparts and perhaps making a few new friends. I hear his response on not rejoining the political structures, but as a specific measure to improve opportunities for young people, will he open talks with the European Union on a youth mobility scheme?
The Prime Minister
It was very good to be in the hon. Member’s constituency, at Blenheim Palace. I cannot tell him how many European leaders said to me that they had previously visited, usually while they were studying in the UK, but had only paid the £5 to get into the grounds, because they had not had the money to get into the building that they were then entering. That was a common theme.
As for the substance of the hon. Gentleman’s question, we are not returning to freedom of movement. I understand the desire of people to work in other countries, but I need to make it clear that there is no rejoining the European Union, no rejoining the single market or the customs union, and no returning to freedom of movement. However, I do believe there is a better deal that we can work on, and I think that the more we can work across the House on that, the better, because then it will be the more enduring.
Peter Swallow (Bracknell) (Lab)
As the proud home of the Royal Military Academy Sandhurst, my constituency knows the vital importance of our armed forces in keeping Britain safe, so I warmly welcome the Government’s commitment to setting out a path towards spending 2.5% of GDP on defence. Can the Prime Minister update the House on conversations that he has had with our NATO friends and allies to encourage others to match that target?
The Prime Minister
I am proud of the commitment that we already make to NATO on 2%. As would be expected, we did have a discussion at the NATO council on the need for all NATO members to make that contribution and to increase their contribution, and there was a commitment to do so. Our commitment to 2.5% will be set out, and the path will be set out, by the Chancellor at a future fiscal event.
Mike Wood (Kingswinford and South Staffordshire) (Con)
Can the Prime Minister confirm that in seeking to reset Britain’s relationship with the European Union, his Government will not accept the automatic application of EU rules in Britain unless they have been specifically agreed by this Parliament?
Oliver Ryan (Burnley) (Lab/Co-op)
I thank the Prime Minister for the leadership that he has shown in his discussions at Blenheim, especially those on NATO. I am proud to hear him recommit us to a two-state solution in the middle east, and to an immediate ceasefire in Gaza. Does he agree that this conflict is dire, but urgently needs sober and considerate solutions rather than extreme rhetoric from those who might seek to sow further divisions?
The Prime Minister
Yes, I do, and I am grateful for that question, because there is the prospect of a ceasefire. It is desperately needed, for the reasons that we have already discussed, but it will only happen if there is international agreement and a sober assessment that provides the framework for the release of the remaining hostages—I shudder to think of the state of some of them—for the aid that is desperately needed to be allowed in at the scale that is needed, and for the beginning of the process, in my view the only process, that will lead to a lasting resolution of this awful conflict. It is not just in all our interests, but our duty, to do everything we can to ensure that that comes about.
Border Security and Asylum
(4 months ago)
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Mr Speaker
Order. Before I call the Home Secretary, may I just say this to her? The statement did not arrive in my office in time; it was late, and I believe that it was also late for the Opposition. Quite rightly, the Home Secretary made a big thing of this when she was the shadow Home Secretary, so I remind her of her own words: statements do need to arrive on time. This is the second time so far, and I know it will not happen again, because what I have said will be taken on board.
The Secretary of State for the Home Department (Yvette Cooper)
May I thank you, Mr Speaker, for standing up for the Opposition Front Benchers, as I know you have often done for me in the past? I apologise to the shadow Home Secretary for the delay in the arrival of the statement.
Most people in the United Kingdom want to see strong border security, with a properly controlled and managed asylum system where our country does its bit, alongside others, to help those who have fled persecution, but where rules are properly respected and enforced so that those with no right to be here are swiftly removed. At the moment, we have none of those things. Border security is being undermined by criminal smuggler gangs, and the asylum system is in chaos. Tragically, 19 lives have been lost in the channel so far this year, including children. No one should be making these perilous small boat journeys.
Criminal gangs have been allowed to take hold along our border, and they are making huge profit from undermining our border security and putting lives at risk. They should not be able to get away with it. Crossings in the first half of 2024 are up by 10% on last year—the number is going up, instead of coming down. At the same time, the asylum backlog is getting worse, as decision making in the Home Office has dropped. Home Office spending on asylum support has increased sevenfold in the space of just three years. This cannot go on. Since my appointment two weeks ago, I have reviewed the policies, programmes and legislation that we have inherited from our predecessors, and I have been shocked by what I have found. Not only are there already serious problems; on current policies, the chaos and costs are likely to get worse.
On our border security, it is clear that the security and enforcement arrangements we have inherited are too weak. Criminal gang networks are operating with impunity along our border, across the continent and beyond, and across the UK too. Action between Britain and France in the channel has improved, and is preventing some boat crossings. The work of the small boats operational command in the channel is important and will continue, but we need to go much further. We should be taking far more action upstream, long before the boats ever reach the French coast. Co-operation with Europol and other European police forces and prosecutors is far too limited, and enforcement against exploitation and trafficking in the UK is far too weak. Information sharing with our European neighbours has reduced, rather than increased. As a result of these weak arrangements, I am extremely concerned that the high levels of dangerous crossings that we have inherited are likely to persist throughout the summer.
Let me turn to the Rwanda migration and economic development partnership. Two and a half years after the previous Government launched it, I can report that it has already cost the British taxpayer £700 million—in order to send just four volunteers. That includes £290 million on payments to Rwanda and the costs of chartering flights that never took off, detaining hundreds of people and then releasing them, and paying for more than 1,000 civil servants to work on the scheme—for a scheme to send four people. It is the most shocking waste of taxpayers’ money I have ever seen.
Looking forward, the costs are set to get worse. Even if the scheme had ever got going, it is clear that it would have covered only a minority of arrivals, yet a substantial portion of future costs were fixed costs—for example, the annual direct payments to Rwanda, the contracts for escorts, the staffing in the Home Office, the detention and reception centres, and more. The taxpayer would have still had to pay out, no matter how few people were relocated. Most shockingly of all, over the six years of the migration and economic development partnership forecast, the previous Government had planned to spend over £10 billion of taxpayers’ money on the scheme. They did not tell Parliament that. I thank the Rwandan Government for working with the UK in good faith, because the failure of this policy lies with the previous UK Government. It has been a costly con, and the taxpayer has had to pay the price.
I turn to the Illegal Migration Act 2023, which has been in place for a year. We were told that it would stop the boats, but it has clearly failed. The legal contradictions in the Act are so great that they make it unworkable; indeed, 12 months on, the central duty has not even been enacted. It is also costing the taxpayer billions of pounds. Under section 9 of the Act, people who arrive in the UK can claim asylum and get asylum accommodation. However, under section 30, if they arrived after March 2023 and meet key conditions in the Act, no decision can be taken on their case; they just stay in the asylum system. Even if they have come here unlawfully for economic reasons and should be returned to their home country, they will not be, because the law does not work. Only a small minority might ever have been sent to Rwanda; everyone else stays indefinitely in taxpayer-funded accommodation and support.
The Home Office estimates that around 40% of asylum cases since March 2023 should be covered by those Illegal Migration Act conditions. The remaining 60%, under the previous Government’s policy, should still have been processed and cleared in the normal way. However, even though previous Ministers introduced this new law 12 months ago, they did not ever introduce an effective operational way for the Home Office to distinguish between the cases covered by the Illegal Migration Act and the other cases where decisions should continue—that is, between the 40% and the 60%. As a result, decisions cannot be taken on any of them.
I have been shocked to discover that the Home Office has effectively stopped making the majority of asylum decisions. Thousands of asylum caseworkers cannot do their proper job. As a result, the backlog of asylum cases is now going up. This is the most extraordinary policy I have ever seen. We have inherited asylum “Hotel California”—people arrive in the asylum system and they never leave. The previous Government’s policy was effectively an amnesty, and that is the wrong thing to do. It is not just bad policy, it is also completely unaffordable. The cost of this indefinitely rising asylum backlog in hotel and accommodation support bills is astronomical. The potential costs of asylum support over the next four years if we continue down this track could be an eye-watering £30 billion to £40 billion. That is double the annual police budget for England and Wales.
This newly elected Government are not prepared to let this chaos continue, so let me turn to the action we are urgently taking to restore some grip to the system, to tackle the chaos and to get costs down. First, I have informed the Rwandan Government that we will be ending the migration and economic development partnership. We will save £220 million on further direct payments to Rwanda over the next few years and we will immediately save up to £750 million that had been put aside by the previous Government to cover the MEDP this year.
Secondly, we will invest some of the saved money from the migration partnership into a new border security command instead. It will bring together the work of the Border Force, the National Crime Agency, the small boats operational command and intelligence and security officers. The recruitment has begun for a new commander and we will put in place additional cross-border officers, investigators, prosecutors, and intelligence and security officers with the new counter-terror-style powers against organised immigration crime announced in the King’s Speech last week. We are immediately increasing UK officers’ involvement in Europol and the European Migrant Smuggling Centre.
Thirdly, we will replace the Rwanda migration partnership with a serious returns and enforcement programme. We have immediately replaced the flight planning for Rwanda with actual flights to return people who have no right to stay to their home countries instead. We are immediately redeploying Home Office staff away from the failed Rwanda partnership and into returns and enforcement, to reverse the collapse in removals that has taken place since 2010. I have tasked the immigration enforcement team with intensifying enforcement activity this summer, targeting illegal working across high-risk sectors.
Fourthly, we will end the asylum chaos and start taking asylum decisions again so that we can clear the backlog and end asylum hotels. The new border security, asylum and immigration Bill announced in the King’s Speech will bring in new replacement arrangements, including fast-track decisions and returns to safe countries. In the meantime, I am laying a statutory instrument that ends the retrospective nature of the Illegal Migration Act provisions, so that the Home Office can immediately start clearing cases from after March 2023. Making this one simple change will save the taxpayer an estimated £7 billion over the next 10 years. Fifthly, as the Prime Minister has just set out, we will work closely with our European neighbours to tackle the upstream causes of migration, including through the Rome process.
This country will always do our bit alongside others to help those fleeing war and persecution, but we need a proper system where rules are enforced. There are no quick fixes to the chaos created over the last 14 years. It will take time to clear the asylum backlog, to bring costs down and to get new enforcement in place to strengthen our borders and prevent dangerous boat crossings, but there is no alternative to serious hard graft. We cannot waste any more time or money on gimmicks. The country voted for change, and that means it is time for a sensible, serious plan. I commend this statement to the House.
Mr Speaker
This very important statement overran slightly, so I am more than happy for the Opposition spokespersons also to run over, if need be.
I call the shadow Home Secretary.
Mr James Cleverly (Braintree) (Con)
Thank you very much, Mr Speaker. I welcome you back to your place, on my first opportunity to do so. In my time as Home Secretary and, before that, Foreign Secretary, you were very kind about my minor indiscretions at the Dispatch Box, my late deployment of statements and my slight overruns. You have always been very kind to my family in sometimes quite trying circumstances, which I very much appreciate.
I also take this opportunity to congratulate the right hon. Member for Pontefract, Castleford and Knottingley (Yvette Cooper) on her appointment as Home Secretary. It is a challenging but incredibly rewarding job and, because the nation’s security is now very much in her and her Ministers’ hands, I genuinely wish her all success in everything she is looking to do.
The right hon. Lady inherits a dedicated team of Home Office civil servants who will help her to keep the country safe and secure. They helped me when I was in her position and, although it is disorderly to recognise their presence, if I were to wave my hand vaguely in their direction, I might take the opportunity to thank my previous private office civil servants.
My notes say that I want to thank the Home Secretary and her team for advance sight of her statement, but I will put a line through that.
The Labour party, and indeed the Home Secretary, likes to talk tough on border security, but today’s statement, despite all the hyperbole and the made-up numbers, is basically an admission of what we knew all along, which is that the Labour party has scrapped the Rwanda partnership on ideological grounds, removing a deterrent that the National Crime Agency said we needed.
The level of discourtesy directed towards the people and Government of Rwanda is quite breathtaking. To have them read about this decision in the papers before anyone from the UK Government had the good grace to formally notify them is an error, and no one in this House believes for a moment that this level of discourtesy would have happened had the partnership been with a European country.
Labour has given an effective amnesty to thousands of asylum seekers who were banned under Conservative plans. Labour’s plans amount to doing less than the Conservatives were doing when we were in government, merely changing the signs above a few desks in the Home Office with its so-called border security command and returns unit. Before the election, the right hon. Lady said that she would create a returns unit, and now the narrative is that she will redeploy some staff—not increase the number of staff, but redeploy some staff—which shows that the returns function already exists.
There is no safe third country to which to return people who cannot be returned home, so where will the right hon. Lady send people who come here from countries like Afghanistan, Iran and Syria? Has she started negotiating returns agreements with the Taliban, the ayatollahs of Iran or Assad in Syria? If she is not going to send to Rwanda anyone who arrives here on a small boat, to which local authorities will she send them? We were closing hotels when I was in government, so I wonder which local authorities will receive those asylum seekers. If not Rwanda, will it be Rochdale, Romford or Richmond? Most importantly, can the right hon. Lady now confirm that people who arrive here illegally in a small boat will be able to claim asylum? Finally, how long after the right hon. Lady briefed the media that she is scrapping the Rwanda partnership did she have the courtesy to speak directly with the Rwandan Government?
It is because we now have no deterrent that nobody wants to head her new so-called border security command. Neil Basu, a former senior police officer for whom I have huge respect, was Labour’s No. 1 choice, and he has ruled himself out. We now learn that General Stuart Skeates, a highly respected former general in the British Army, who was, in large part, responsible for delivering the Albania deal, which cut small boat arrivals from that country by 90%, has resigned from his position as director general for strategic operations. To misquote Oscar Wilde, “to lose one border commander could be seen as a misfortune; to lose two looks like carelessness”—perhaps even incompetence. I notice that the new job advert—it is available online for those who are thinking of applying—for Labour’s border security command says that the role is not located in Kent, where the channel is, but is flexible from Belfast, Bristol, Cardiff, Durham, Glasgow, Liverpool or Manchester, none of which, the last time I checked, are anywhere near the English channel.
The reality is that everybody knows, including the people smugglers, that the small boat problem is going to get worse—indeed, has already got worse under Labour—because there is no deterrent. People are being sold a lie when they are being smuggled into this country, across one of the busiest shipping lanes. We need to stop them. Too many lives have already been lost. Sadly, six more have been lost in the channel in the last few weeks, and our hearts go out to them and their loved ones. We disagree on many things, but we can agree that we need to put an end to this evil trade. Sadly, the initial decisions made by her Government have made the problem worse, not better.
Yvette Cooper
I welcome the shadow Home Secretary’s words about the dedication of Home Office officials and about the importance of work on national security. As he knows, when I was shadow Secretary of State, I always worked with him and supported him around national security issues. I know he will do the same and I welcome him to his shadow post. I presume what we heard was the first of the Conservative leadership contest speeches.
I will respond to some of the things the shadow Home Secretary said. We need to be clear about what we have inherited from him and his party. Under his party, we have had the highest level of spring crossings ever. Gangs have been left to wreak havoc, not just along the French coast but across our border, through our country and back through Europe. Asylum support costs are set to rise to £30 billion to £40 billion over the next four years as a result of his and his party’s decisions.
As for the idea of deterrence, I am sorry but four volunteers being sent to Rwanda is not a deterrent to anyone for anything at all. The idea that he would spend £10 billion on this fantasy, this fiction, this gimmick rather than ever do the hard graft—£700 million has already been spent on sending just four volunteers in two and a half years. We have often warned that, frankly, it would be cheaper to put them up in the Paris Ritz. As it turns out, it would have been cheaper to buy the Paris Ritz.
As for the amnesty, I do not know if the right hon. Gentleman has ever understood the Illegal Migration Act 2023, which he voted for and he inherited from his predecessors. He asks if people who arrive illegally can claim asylum—that is exactly what happens under section 9 of that Act. They can all claim asylum, enter the asylum system and be entitled to asylum support. That is what happens in the system, which we have inherited, that he has presided over and run since he became Home Secretary. The problem is that people enter the asylum system but never leave. He did not bring in operational arrangements to try to take decisions properly. His Home Office effectively stopped taking the majority of asylum decisions in May. Perhaps he did not know that, but that is what happened in his Home Office. This party and this Government do not believe in amnesties. We think that the rules need to be respected and enforced. His party is the one that has given an effective amnesty to people who can end up staying in the asylum system forever. We believe that the rules should be enforced. The problem is that that is what the shadow Home Secretary believes too. He does not believe any of the stuff that he has just said. He is only saying it for his Tory leadership contest; he is just too weak to tell his party the truth. He thought that the whole policy on Rwanda was “batshit” and then he went out to bat for it. It is just not serious.
Mr Clive Betts (Sheffield South East) (Lab)
I welcome my right hon. Friend to her place and thank her for her statement. We all suspected that policy in the Home Office under the previous Government was a bit of a mess, but we did not realise how much of an expensive mess it was until she provided us with the details in her statement.
Let me ask the Home Secretary about the attraction for people to come here illegally to work in the black economy. If people have suspicions, they have to go to His Majesty’s Revenue and Customs, the Gangmasters and Labour Abuse Authority, UK Visas and Immigration and the police to get action to deal with those activities. I note that the Home Secretary is looking to try to combine the approach to deal with illegal working in the car washing sector. Will that be a systematic change of approach, and will it be applied to other sectors as well? It would be very welcome if that were the case.
Yvette Cooper
My hon. Friend is right. We must tackle the illegal working and also the exploitation that can often drive a lot of what happens. That is why we are intensifying the immigration enforcement, which is part of our new, huge expansion to the returns and enforcements unit. He is right that the process, which has become too complicated and too bureaucratic, needs to be simplified to make sure that the rules are being enforced. We have set out the high-risk sectors on which we wish to focus this summer, but we need a more systematic approach. We have talked about a single enforcement approach, and we will be setting out more details about those plans.
Richard Foord (Honiton and Sidmouth) (LD)
In 2018, the number of small boat arrivals stood at 299. In 2023, last year, the number had risen to more than 29,000. What happened in those intervening five years? One thing that happened was the closure of the Vulnerable Persons Resettlement Scheme, which was introduced by the coalition Government in 2014 and was designed to select some of the most vulnerable people from refugee camps in Jordan, near Syria. What we have seen since the closure of that scheme is people choosing instead to make for these shores rather than applying in refugee camps. Will the Home Secretary rule out the offshore processing of asylum seekers, or will she consider introducing a scheme similar to the Vulnerable Persons Resettlement Scheme, which could incentivise asylum seekers applying for asylum close to the war zones afflicting them?
Yvette Cooper
I welcome the hon. Member to his new post. He is right to talk about the importance of the UK doing its bit to help those who have fled persecution and conflict. It is why I strongly believe that the Homes for Ukraine programme was immensely important. Personally, it has been important to our family. It is important that the UK has done its bit, including in previous years around Hong Kong and Afghanistan. That must continue to be the case, but that help must operate alongside a properly functioning system, otherwise criminal gangs will continue to exploit the system whatever it is. At the moment, those criminal gangs are getting away with it.
Let me turn to the specific issue of offshore processing. In fact, the Vulnerable Persons Resettlement Scheme was a form of offshore processing, just as the Homes for Ukraine scheme was. There are different ways to arrange these things. Our approach is always to look at what works. As long as it meets proper standards in terms of international law, we should be serious about what it is that works in order to tackle the complex problems that we face.
Joani Reid (East Kilbride and Strathaven) (Lab)
I thank my right hon. Friend for her statement. I think that my constituents will be incredulous when they are informed of the extent to which the previous Government wasted so much money on this scheme. What commitments can she give the House that we will be able to rescind our commitments to spend further money on any such programmes, and that no further public money will be wasted?
Yvette Cooper
My hon. Friend makes a really important point. I welcome her to Parliament, and I welcome her asking questions on this issue. We have to take a strong, rigorous and robust approach to value for money in every Department. It cannot simply be the responsibility of the Treasury; it has to be the responsibility of the Home Office, and of every Government Department. That is the approach that this Labour Government will take. I am frankly shocked that under the last Government not just the Home Office but the Treasury, the then Prime Minister and his Cabinet colleagues all signed off on these incredibly high payments and costs. They must have had the modelling that would tell them how much the costs would go up by, yet they signed off on them. Our Government are determined to pursue value for money at every stage.
Kit Malthouse (North West Hampshire) (Con)
If the number of small boat crossings are higher next summer than this summer, will she resign?
Yvette Cooper
I realise that the right hon. Member is keen to get rid of me before I have even finished standing up at the Dispatch Box. Unfortunately, we have seen a succession of Conservative Home Secretaries—eight, I think, in the last eight years—none of whom resigned. Two of them were sacked under the last Government—actually, those two were the same person. Look, we have to be serious about this, because the dangerous boat crossings are undermining border security and putting lives at risk. Nobody should be making those journeys, and we have to work not just here but across other European countries to stop boats before they reach the French coast in the first place, to ensure that lives can be saved and the gangs are held accountable for their terrible crimes.
Josh Simons (Makerfield) (Lab)
I thank the Home Secretary for her statement on the shocking figures that are symbolic of the failure of Conservative Members to restore control over our borders. I note that, despite that spending of taxpayers’ cash, removals of failed asylum seekers and foreign national offenders collapsed under the Conservatives. What is the Home Office doing to ensure that those who have no right to be in the UK are swiftly removed and the rules are properly enforced?
Yvette Cooper
My hon. Friend makes an important point, and I welcome him to his seat in Parliament. He is right that removals of failed asylum seekers have fallen by a third since 2010. Removals of foreign national offenders have fallen by a quarter. That is not good enough. It means that the rules are not being respected or enforced, and it is why we will set up a new returns and enforcement programme. We have committed to 1,000 additional staff to work on returns and enforcement, to ensure that the rules are respected, not only where we have returns agreements in place but looking at individual cases as well. We must ensure that we have a system that people have confidence in. There is a lot of chaos to tackle, but we are determined to do it.
Pete Wishart (Perth and Kinross-shire) (SNP)
The Home Secretary is absolutely right to lay into the Conservatives for their shambles of an immigration policy, which will define them for years to come, but all I am hearing is her being harder on asylum seekers. Enforcement seems to be her priority. When will we hear about the safe and legal routes that asylum seekers access to come to this country, and will she stop the dehumanising and scapegoating language, and pledge to take no quarter from the belligerents behind me?
Yvette Cooper
As I said in response to the hon. Member for Honiton and Sidmouth (Richard Foord), ensuring that the UK always does its bit to help those who have fled persecution is really important. We have done so through different programmes in the past. We had the Syrian families programme back in 2015, which was important, but we also have to ensure that the system works and has credibility, and that the rules are enforced. Too often at the moment the rules are not enforced, but they need to be, so that everyone can respect the system. Also, too often we have criminal gangs causing havoc, able to undermine border security and making huge profits. It has become a criminal industry along our border, and that is deeply damaging. I agree that this cannot be about rhetoric; nobody should be ramping up the rhetoric, especially alongside gimmicks that do not work. We have to be serious about this issue and put in place sensible plans that work.
Mike Amesbury (Runcorn and Helsby) (Lab)
I welcome the Home Secretary—the Labour Home Secretary—to her place. We have inherited an almighty mess, with asylum accommodation costing £8 million per day. It is absolute chaos and, according to The Sunday Times, there are even middlemen and middlewomen taking advantage and profiteering through the system. How is she going to get a grip of this chaos we have inherited from the previous Tory Government?
Yvette Cooper
My hon. Friend raises an important question. As well as a failure to tackle the criminal gangs taking hold along the channel, there has also been too much of a focus on gimmicks and a failure to have practical planning in place. For example, there was a failure to ensure that there were proper long-term contracts on asylum accommodation, so that instead the chaos at Manston a couple of years ago led to last-minute hotel procurement, which was completely inappropriate accommodation and cost a fortune as well.
We have to tackle that. That is why we have set out plans and we are determined to make sure that we can get that backlog down and end asylum hotel use. As a result of the chaos with the Illegal Migration Act 2023 and the fact that the Home Office had stopped taking decisions, that will now take time and it will be difficult to sort out, but that is why the statutory instrument we are laying before the House today is so important. That alone should save the taxpayer £7 billion.
Dr Kieran Mullan (Bexhill and Battle) (Con)
I know the Labour party managed to go an entire election campaign without answering this question, and the Home Secretary failed to answer it again when asked by the shadow Home Secretary, but I will give it one more try. Where does the Home Secretary intend to send failed asylum seekers from Afghanistan, Syria and Iran?
Yvette Cooper
The hon. Gentleman obviously does not understand the system that his party and his Government put in place. All the people who are in the asylum system are staying there. Under his policies for those individuals, they are now being sent all around the country into asylum hotels. That is the system the Conservatives have left us with. We do not think that is the right thing to do. We think that asylum decisions should be taken on a case-by-case basis. That is the right thing to do. We also think we should have proper returns agreements and do what his party should have been doing, under his own policies, for the 60% of people who continued to be entitled to asylum decisions but were not getting them under his Illegal Migration Act. What we will do is run the asylum system effectively, which his system should have been doing.
Rachael Maskell (York Central) (Lab/Co-op)
I congratulate my right hon. Friend on the forensic work she has been doing in her Department. What considerations has she given to humanitarian visas for people in Gaza to be reunited with their family, if they are studying in the UK or working in our NHS? My constituent has a wife and two little children in Gaza at the moment; he cannot return home, yet the last Government refused to make provision for them to come and be reunited with him in the UK.
Yvette Cooper
My hon. Friend will know that there are long-standing arrangements for family reunion and for refugees. There are also different concerns that have been raised around Gaza, because there is a real importance to people’s being able to return to their homes in the middle east too. If she has an individual case that she would like to raise with my hon. Friend the Immigration Minister, she is very welcome to do so.
Lee Anderson (Ashfield) (Reform)
When I was in the migrant camps in northern France last year, the migrants told me and some of my colleagues that one deterrent that would stop them coming would be if they were turned back in the channel or sent back the same day. We saw the Border Force agency take a boatload back just last week. Will the Home Secretary now, with that advice, grow a political backbone and order the Border Force to send the boats back the same day?
Yvette Cooper
The hon. Member refers to an incident in the channel where there was co-operation between Border Force and the French authorities that also involved returning people to the French coast. That operational co-operation is important, but I would just say to him that “co-operation” is the really important word. If we want to prevent gangs operating and organising, and prevent boats from reaching the French coast in the first place, we have to work closely not just with France but with Germany and other European countries, and with the countries through which some of the supply chains are operating. It is that co-operation that he and some others in his party have quite often refused, but it will be important and is our best way to stop the criminal gangs.
Mr Toby Perkins (Chesterfield) (Lab)
In a few short days, my right hon. Friend has simultaneously saved the taxpayer a tremendous amount of money and got more people in the Home Office working on getting the system sorted than in previous years. I congratulate her on that. Does she agree that it is entirely in keeping with Labour values to ensure safe refuge for those fleeing war zones, and, at the same time, to ensure that those who are not entitled to be here are repatriated, saving the UK taxpayer money?
Yvette Cooper
My hon. Friend is right. There are principles here about doing our bit to help those who have fled persecution while also ensuring that the rules are enforced so that people who do not have a right to be here should be swiftly returned. At the moment, none of those things applies or is working properly. We have to restore order to the asylum system so that we can go back to the principles that, going back many years, the UK has always stood for.
Carla Denyer (Bristol Central) (Green)
It is a huge relief that the vile Rwanda scheme has been scrapped. I have listened carefully to the Home Secretary’s statement. Given that 94% of people seeking asylum in this country are ready and eager to work to support themselves, and that freezing them out of work leaves them in destitution and means that the UK misses out on tax revenue from their work, and on much-needed specialists and professionals such as the nurse I met recently in an asylum seeker project in Bristol, will the Home Secretary take the advice of the United Nations High Commissioner for Refugees and urgently lift the ban on asylum seekers working?
Yvette Cooper
No, I do not believe that is the right approach, because we need to make swift decisions and ensure that the rules are properly respected and enforced. I am concerned about employers who exploit those who have sometimes arrived as a result of criminal gangs, trafficking or smuggling. I do not believe that employers should be able to exploit those kinds of routes and journeys. If people who have fled persecution are granted asylum in this country, of course they should be able to work and to do so swiftly, but if they are not entitled to be here—if they have not fled persecution—and should be turned down and returned to their home country, they should not be able to work in the UK.
Mike Tapp (Dover and Deal) (Lab)
My constituents take this issue seriously as they are at the very frontline and the Conservatives have left us with open borders. I thank my right hon. Friend for dealing with the matter with such seriousness. How long will it take to put the border security commander in place, and what sort of impact will they have in assisting law enforcement?
Yvette Cooper
I thank my hon. Friend and welcome him to his position. I know that his Dover and Deal constituency has faced real pressures as a result of the criminal gangs and the small boat crossings. I thank him for his work and experience in tackling these issues. He knows very well the work of the National Crime Agency, for example, in tackling the criminal gangs.
We are putting in place the steps for the border security command straight away. We have already begun recruitment not just for the new commander but for additional staff: hundreds of additional cross-border police, security and intelligence officers, and specialist investigators and prosecutors. That work will start straight away. We have already immediately increased the UK presence in Europol and its European migrant smuggling centre so that we can get on with that work to build those partnerships and take action.
Greg Stafford (Farnham and Bordon) (Con)
I am sure the Home Secretary agrees that this is a moral issue: we must never again see people dying in the channel. However, does she also agree that deterrence must be a part of the panoply of measures that we put forward? I am not clear on what deterrent measures she is going to put in place or—because this question has failed to be answered a number of times—what will happen to failed asylum seekers from countries such as Syria, Iran and Afghanistan?
Yvette Cooper
I agree with the hon. Member that it is devastating that lives are being lost, including children’s. We have seen increasing violence from some of the gangs, crowding more people on to these overcrowded boats, which has resulted in a seven-year-old girl losing her life.
The hon. Member talks about deterrence. The problem with the Rwanda scheme is that it is clearly not a deterrent: four people being sent over two and a half years is not a deterrent at all. There are also no deterrents at all for any of the criminal gangs, which at the moment can operate with impunity, so we have to start by ensuring that the criminal gangs can face justice and that action is taken against the supply chains earlier on—that we have consequences, and that there is a deterrent there.
I would also say that a system whereby people can arrive in the UK and stay in the asylum accommodation system forever, which is the situation under the Illegal Migration Act 2023, which the hon. Member’s party voted for, means that there is no disincentive for anyone. It makes it very easy for people to stay indefinitely and work illegally, even if they have no right to be here. That goes against the rules and means that the system is just not working.
Adam Thompson (Erewash) (Lab)
I thank the Home Secretary for her statement, which contained some really quite revelatory points about the state of the finances. Sandiacre in my constituency has been home to two asylum hotels, one of which I was very pleased to see close recently, but the Best Western hotel remains open. This is a huge cost to people in my constituency and across the nation, and it leaves asylum seekers caught in an endless and inescapable limbo. What steps will the Home Secretary take to ensure that we can close asylum hotels once and for all?
Yvette Cooper
My hon. Friend makes a really important point. We need to clear the backlog—not just let it grow and grow, which is what the Conservatives were doing, but clear the backlog so that we can end asylum hotels, which are inappropriate and extremely costly. Having discovered that the Home Office had effectively stopped taking the majority of asylum decisions under the shadow Home Secretary, the right hon. Member for Braintree (Mr Cleverly)—who does not seem to know what his own Department was doing as a result of his own policies—I am extremely concerned that that will now take longer to do, but it remains an immensely important thing that we have to do. The other thing we will have to do is tackle the backlog in the appeals process that the Conservatives had allowed to grow, which is also slowing down the system.
Brian Mathew (Melksham and Devizes) (LD)
I congratulate the Home Secretary on her appointment and on her statements to the House. Following on from a previous question, but perhaps with a nuance, will asylum seekers—perhaps after initial registration—be allowed to work and pay taxes while their applications are pending?
Yvette Cooper
If people have a right to be in the UK—if they have fled persecution and been granted refugee status, or they have come to be here on a visa through the normal processes—we will of course have them contributing to our country. That has been the case for generations, but if people are not here lawfully— if they have not fled persecution, and should fail the asylum process and be returned—they should not be working in the UK. This is simply about having a swift system so that we can make decisions quickly and ensure that the rules are enforced.
Anna Dixon (Shipley) (Lab)
I am delighted to see my right hon. Friend in her place on the Government Benches. I am proud that Bradford is a city of sanctuary, and of organisations such as Bevan Health, set up by a GP in my constituency, which works to deliver vital healthcare to asylum seekers who are awaiting decisions, sometimes for over 12 months and in many cases in hotels. Can my right hon. Friend provide an assurance that asylum seekers will continue to have access to essential healthcare as our Government work to clear the asylum backlog, so that in future fewer people will be left languishing in hotels?
Yvette Cooper
My hon. Friend is right; it is really important that we try to clear the backlog as rapidly as possible. It includes some people who are very vulnerable and may be in need of support. It also includes people who should not be in the UK, and the system should operate fairly so that they are swiftly returned. But we actually have to get back to decision making. I thought I would be coming to this Dispatch Box and saying, “Well, what we want to do is to speed up or accelerate decision making.” I did not think I would be standing at this Dispatch Box saying, “No, no, we actually have to restart asylum decision making in the first place, because the Conservatives just stopped it.” I really had not expected that. It really is far more shocking than I had imagined, and I really thought I had a good imagination.
Richard Tice (Boston and Skegness) (Reform)
When you take a drug dealer off the street corner, guess what: another one appears, because of the vile drugs trade and the amount of money involved. My constituents in Boston and Skegness believe it is exactly the same with trying the Home Secretary’s policy of smashing the gangs. If she smashes one gang, it is like a game of whack-a-mole: another one will appear and then another one, because there is so much money involved. Here is the point: how long will the Home Secretary give her policy before realising that the only policy that will work is the one she actually started last week, which is to pick people up and take them back to France, which we are entitled to do under international maritime law? It will help British citizens, help British taxpayers and help the French, and it will reduce the magnet factor.
Yvette Cooper
I say to the hon. Member that no one should be making these dangerous journeys, and the criminal gangs are making massive profits from organising these boats. I just do not think they should be able to get away with it, and they are at the moment. We should be taking action against those criminal gangs, and I simply do not accept that it is impossible to go after them. We must ensure that we take action not just on the gangs themselves, but on their supply chains, the routes the boats are taking and their finances, and that we properly and substantially increase law enforcement resources. As hon. Members will know, we have had cases where journalists have identified smugglers and those responsible for being involved in some of the smuggler gangs, and I think those gang members should be facing law enforcement. It is essential that we do this. This is about properly standing up for the rule of law, as well as making sure that we do everything we can to prevent these dangerous small boat crossings.
Laura Kyrke-Smith (Aylesbury) (Lab)
I am very pleased to see the Home Secretary take her place. My constituents in Aylesbury have two concerns: first, that we re-establish control of our borders; and secondly, that we remember the need for compassion for vulnerable people fleeing conflict and persecution. On that point, will she commit to ensuring that there are resettlement routes for people fleeing desperate and dangerous circumstances, and what will she do to ensure that they are viable?
Yvette Cooper
My hon. Friend is right, and I welcome her to her place in this House. I think what people in this country have always wanted is that combination of strong border security and a proper, fair system, so that we do our bit alongside other countries to help those who have fled persecution, but also so that the rules are enforced and those who do not have a right to be here are returned. She will know that there is a series of different resettlement routes or different forms of support—for example, the Homes for Ukraine scheme, which continues, and some of the Afghan resettlement schemes. We are concerned about the operation of some of the Afghan schemes, and we are looking further at that to ensure they are functioning properly.
Jeremy Corbyn (Islington North) (Ind)
I thank the Home Secretary for her statement. The tragedy of desperate people dying in the channel is compounded by desperate people dying in the Mediterranean and the Aegean as human beings fleeing all kinds of horrible situation seek a place of safety. Is she co-operating with other European countries on a safe route for asylum seekers? Is she prepared to look in a much more humane way at the desperate situation facing people fleeing human rights abuses and wars around the world?
Yvette Cooper
The right hon. Member makes an important point about what is happening in the Mediterranean, and about the pressures we have seen and the fact that, as the Prime Minister said in his statement, we have seen not just conflicts, wars and persecution, but the impact of climate change, making people travel and sometimes leading them to make dangerous journeys. We should be working to prevent the need for those dangerous journeys in the first place. That is why the Prime Minister announced last week at the European Political Community summit that we will invest over £80 million, alongside work with other European countries, also as part of the Rome process, both to tackle some of the wider criminal gang networks that still operate in the Mediterranean and to ensure that we address the injustices and serious crises that lead to people making such dangerous journeys in the first place.
Mr Jonathan Brash (Hartlepool) (Lab)
I warmly welcome my right hon. Friend the Home Secretary to her place. One of the consequences of the collapse in our asylum system over the past few years has been the increasing and intolerable pressure on local communities —my constituents in Hartlepool raise this with me time and again. Will she outline how the steps that she is taking will begin to reduce that pressure on communities such as Hartlepool?
Yvette Cooper
I welcome my hon. Friend to his place. There is a real challenge from the chaotic way the asylum system has been run, which has led to the last-minute procurement of hotels and has ended up being extremely costly. Everybody loses out from spending billions of pounds on this system, but also from local authorities often not having time to work with communities or accommodation providers to ensure that things are managed in the right way. Because asylum decisions stopped being taken, there will now be some challenges in getting the system working again, which means that bringing down the backlog will take longer than we initially anticipated. But we are determined to do this; it is the only way to get back to having a functional system that everybody across the country should be able to support.
Jim Shannon (Strangford) (DUP)
I welcome the Home Secretary to her place and wish her well for the future, and I thank her for the helpful and confident answers that she has given.
There is, of course, a glaring issue regarding border security much closer to home: the border between Northern Ireland and the Republic of Ireland. This border was patrolled by Republic of Ireland officials, and understandably so as their right to protect their nation is paramount. However, it is also clear that the Good Friday agreement does not preclude the need to conduct checks on the border. What discussions have there been with the Police Service of Northern Ireland and security forces in Northern Ireland to ensure that the open border with the Republic of Ireland does not become a free route for UK immigration?
Yvette Cooper
It is a pleasure to get my first question at the Dispatch Box from the hon. Member, and I look forward to very many more. He raises important issues. The border issues between Northern Ireland and Ireland are of course different; we rightly have different arrangements that reflect our long-shared history. But we also have very close co-operation. We have close policing co-operation, close information sharing, and additional information sharing that is not currently possible under the arrangements we have inherited with other European countries. It is important that those information-sharing arrangements continue, and hopefully we can build on them with other European partners.
Pam Cox (Colchester) (Lab)
I thank the Home Secretary for her statement. I share her astonishment at the scale of the mismanagement of the asylum system by the previous Government. My constituency of Colchester has hosted many asylum seekers and refugees over the years. We are a city of sanctuary. Our local authorities have played a full part in supporting that work. Will she confirm that those local authorities will be fully engaged in the work going forward to ensure that we have more effective support systems?
Yvette Cooper
My hon. Friend is right to raise the importance of working closely with local authorities. We are determined to do that. The Immigration Minister already has work in chain looking at how we can have better working co-operation between the Home Office and local authorities. It is also important to recognise that, through many generations, refugees have come to this country and contributed to our economy and society and been a hugely important part of that. It is partly because we have that important history that it is crucial to get the whole system functioning again, instead of the chaos we have at the moment, which undermines everyone’s confidence.
Oliver Ryan (Burnley) (Lab/Co-op)
I thank the Home Secretary for her statement. The people of Burnley, Padiham and Brierfield want to see these crossings stopped and these gangs smashed, and they will welcome her tough action today. Because of the previous Government’s complete failure to control our borders, they spent millions of pounds a week on asylum hotels. What will she do to speed up the processing of people in these hotels and end their use?
Yvette Cooper
I welcome my hon. Friend to Parliament. We have to do all these things. We have to take action on the criminal gangs exploiting the situation in the first place, which involves much stronger co-operation with European colleagues. That must include the new counter-terror powers that will be in the new legislation as part of the King’s Speech to strengthen powers against organised immigration crime. Alongside that, we have to get the basics right. We have to start taking decisions again, as well as speeding up asylum decisions and making the system work again.
CrowdStrike: IT Outage
(4 months ago)
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The Minister without Portfolio (Ellie Reeves)
On Friday 19 July, we saw a CrowdStrike software update on Microsoft systems result in a major global IT outage. It caused significant impacts around the world. Impacts were seen in the transport sector, with flights grounded in Europe and the US, and delays and cancellations here in the UK. Live train departure boards were impacted during the morning rush hour, and some media outlets lost the ability to provide live coverage. The outage caused substantial inconvenience for passengers hoping to travel for the summer holiday getaway on the busiest travel weekend of the year. Airports and airlines across the UK had measures in place to maintain safe operations, support passenger welfare, extend operating hours and deploy additional staff to support late-running operations and keep people moving where possible. As with all incidents, the sector will review its response and implement any learnings.
More concerningly, large parts of the local UK healthcare system lost access to test results and appointment information, affecting mostly GP services. Tried and tested NHS contingency plans were enacted and services are expected to be operating at full capacity in the next few days. Small businesses without dedicated IT support systems were heavily impacted due to disruption to card-only payment systems and ATMs, with many resorting to operate cash-only while firms worked to fix their systems. Many firms were able to get back online quickly and the remainder are expected to restore operations this week.
Officials from the National Cyber Security Centre quickly established that the outages were not the result of a security incident or malicious cyber-activity. The cause was instead identified to be a flawed CrowdStrike software update that caused Windows machines to crash.
On Friday morning, CrowdStrike issued guidance on how to solve the problem, giving users a manual fix for each affected device or system. I now believe that CrowdStrike is in the process of implementing an automated update, which can be applied remotely and should therefore speed up recovery. However, there are still residual impacts from the failed update, and it is important that we continue to monitor the situation and the longer-term impacts to UK sectors and secondary impacts from international disruption.
Ever since the incident occurred, the Government have worked closely with both Microsoft and CrowdStrike. My Cabinet Office officials have been leading co-ordination of the Government response across all impacted sectors of the economy. That included close monitoring of affected public services to ensure that business continuity plans were enacted and services were supported as they came back online. Two Cobra senior officials meetings were also convened on Friday to co-ordinate the response, and officials from across His Majesty’s Government met over the weekend to continuously monitor the impacts and the recovery process. I am pleased to say that Government services and the online services that the Government provide were and remain largely unaffected. My colleagues including the Chancellor of the Duchy of Lancaster, the Health Secretary and the Transport Secretary attended briefings with officials throughout, and the Prime Minister was kept informed.
The majority of the sectors that were impacted have now mostly recovered. The UK transport system—aviation, rail, road and maritime—is running normally. NHS staff worked hard over the course of Friday and the weekend to quickly apply the fixes required, and my colleagues in the Department for Health and Social Care have confirmed that systems are now back online, including for GPs. Their advice is that patients should continue to attend their appointments unless told not to. There may still be some delays, and GPs will need to rebook appointments that could not be made during the IT outage. The public should continue to contact their GPs in the normal way.
As IT systems are complex, we can expect that minor disruption will continue in some areas while systems continue to recover, but my officials expect those to be resolved in the next couple of days. I would like to thank everyone who has worked so hard to get systems up and running again, and all staff who have worked tirelessly to support individuals impacted by the outage.
Following this incident, the Cabinet Office will work with the National Cyber Security Centre and other partners across Government to review the lessons learned. The Central Digital and Data Office will work with the NCSC to implement any improvements to the existing response plans to cover both technical resilience features as well as cyber. The Cobra unit will work with Departments to support their processes for establishing how the organisations and sectors they represent manage the impacts of the outage and what lessons have been learnt.
As soon as the Government were elected, we took immediate steps to begin legislating to protect public services and the third-party services they use. Our cyber-security and resilience Bill, included in the King’s Speech, will strengthen our defences and ensure that more essential digital services than ever before are protected. For example, it will look at expanding the remit of the existing regulation, putting regulators on a stronger footing and increasing reporting requirements to build a better picture in Government of cyber threats. Technology failures can be as disruptive as cyber-attacks, and the move to create the centre for digital government within the Department for Science, Innovation and Technology is aimed at creating a more resilient digital public sector.
What this incident shows is how dependent the modern world is on complex and interconnected IT systems and how essential preparedness for such events is, including business continuity planning. Notwithstanding the immense frustration and inconvenience that the outage has caused, I am pleased to see that effective contingency plans mitigated the very serious impacts that the outage could have had. I am pleased also that there is to be a comprehensive process to identify the lessons from this episode. I hope that they will lead to improvements that both help prevent similar incidents and further improve our resilience to system outages and the impacts they can have. In that spirit, I commend the statement to the House.
Sir Oliver Dowden (Hertsmere) (Con)
May I begin by welcoming the hon. Lady to her role and thanking her for advance sight of the statement? In that role I know she will be supported by a dedicated team of civil servants, who represent the very best of public service. I have no doubt that they will serve her as well as they did me.
The hon. Lady will be aware of the enormous challenges facing this Government and those around the world in relation to cyber-security. As I warned when I was the responsible Minister, threats to public services and critical national infrastructure come from a range of challenges, from hostile state actors to human error and design flaws. Last week we saw those challenges vividly brought to life. Following the corrupted antivirus update by CrowdStrike on Friday, 8.5 million Microsoft devices globally were rendered unusable. That left airports disrupted, patient records temporarily lost and GPs unable to access important patient data, creating significant backlogs. That is more than an inconvenience.
I pay tribute to all those working in our public services for the efforts they undertook over the weekend to restore those services, and to the work of dedicated cyber specialists across Government, including in the National Cyber Security Centre. In government we undertook a wide range of measures to enhance the nation’s cyber-security: creating the National Cyber Security Centre, introducing secure by design, setting cyber-resilience targets, launching GovAssure and transforming the oversight of governmental cyber-security.
I note, as the hon. Lady said, that the Government intend to build on that progress by bringing forward a cyber-security and resilience Bill. Will she therefore outline the timetable for the Bill, and will the Government consider mandatory cyber-security targets for the UK public sector? Are the Government considering obligations to ensure that infrastructure is designed to be resilient against common cause problems, such as this one? What steps are being taken to enhance cyber-security in the devolved Administrations and in parts of the public sector such as the NHS, which are operationally independent?
Specifically in relation to this incident, what assessment has been made of the prevalence of CrowdStrike within critical national infrastructure? What further reassurance can the Government give in relation to the timetable for full recovery of key systems and data? In particular, can the Minister assure employees that this month’s payroll will not be adversely affected?
Britain’s cyber industry is world leading. Cyber-security now employs more than 60,000 people and brings in nearly £12 billion-worth of revenue annually. This transformation was in part due to our £5.3 billion investment, which launched the country’s first national cyber-security strategy. I therefore urge the Government—I see the Chancellor in her place—to continue such investment.
Incidents such as that of CrowdStrike should not deter us from the path of progress. We must embrace digitalisation and the huge improvements to public services that it offers. The adoption of artificial intelligence across Government is the closest thing we have to a silver bullet for public sector productivity. However, if we are to command public confidence, people must be assured that technology is safe, secure and reliable. Such incidents demonstrate how reliant the Government and public services are on large technology companies, and how much responsibility they have for the services that have become critical to people’s lives and livelihoods. That is why, in government, I called for us to work more closely with leading technology firms to address these shared challenges. The best solution is partnership. To that end, what further engagement will the Minister undertake with Microsoft, CrowdStrike and the wider sector to ensure that there is no such recurrence?
The task for us all is to build on existing progress that has transformed Britian’s cyber defences, and to enhance protections for British families, businesses and the very heart of Government. In that mission, the Government can rely on the support of the Opposition.
Ellie Reeves
I thank the shadow Minister for his contribution and his questions. In particular, I echo the thanks to all those in Departments across the civil service who were involved in dealing with the outage last Friday and in mitigating its effects. I set out in my statement that our cyber-security and resilience Bill, which was included in the King’s Speech, will strengthen our defences and ensure that more digital services are protected. That is a priority for this Government. The Bill will look at expanding the remit of regulation, putting regulators on a stronger footing and increasing reporting requirements, so that the Government can build a better picture of cyber-threats. We will consider the implications of Friday’s incident as we develop that legislation, but rest assured that we are working across Government to ensure resilience.
As the Chancellor of the Duchy of Lancaster said in his statement on the covid inquiry module 1 report, he will lead a review assessing our national resilience to the full range of risks that the UK faces, including cyber-risks.
Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
It is a great pleasure to see my right hon. Friend the Minister in her place. As she said, the CrowdStrike outage is a reminder not only that technology is so integrated into all our lives, making them better, but also of our dependence on the standard of development, deployment and integration of new technology, which is largely not visible to us. I was reassured to hear about the steps that the Government and businesses have been taking to mitigate the impact, but I fear that small businesses and consumers do not have the same resources. Does she agree that people should not have to be able to reboot from a blue screen in order to enjoy the benefits of technology? Will her Government move to ensure that consumers are better protected?
Ellie Reeves
I thank my hon. Friend for that contribution, and I want to acknowledge all the work that she has done in this area. It has been hugely valuable. She makes really important points about ensuring that consumers and small businesses are protected, as well as Government Departments and bigger businesses. I am sure that will form part of the lessons learned from this incident, and will feed into the Bill that we will introduce.
Daisy Cooper (St Albans) (LD)
This is my first opportunity to welcome Ministers to their places. I thank the Minister for advance sight of the statement. I want to focus on the impact on the NHS. My thanks, and I am sure those of the entire House, go to all NHS staff who have been scrambling to deal with urgent inquiries from distressed patients.
I wonder if I might press Ministers for assurances on two patient groups who need time-critical care. First, some patients require blood test results before they can commence urgent treatment or have operations. Are there any assurances on the attention that they will be given by the NHS, both now and in any future scenarios? Secondly, there are patients at great risk of becoming extremely ill from getting covid. Since the previous Government scrapped the covid medicines delivery unit, many vulnerable patients have been struggling to get the anti-virals that they need from their GP in time. That situation is made much worse when this kind of disruption happens. Can the hon. Lady provide assurances about any attention that NHS England has given to those two patient cohorts? If not, is she willing to meet me to discuss what we might do in future?
Ellie Reeves
I thank the hon. Member for her question highlighting the issues facing vulnerable patients. I am pleased to report that there was no reported impact on 111 or 999 services, and that patients were able to access emergency care. The majority of the impact on GP services was in accessing patient records, GP appointments and prescriptions. Patients who could not access GP appointments were able to attend urgent care services, and GPs were able to issue paper prescriptions. However, I will pass on the hon. Lady’s concerns to my colleagues in the Department of Health and Social Care, because they are incredibly important issues and we need to ensure that vulnerable patients are protected, going forwards.
Pamela Nash (Motherwell, Wishaw and Carluke) (Lab)
May I take this opportunity to welcome you, Madam Deputy Speaker, to your very temporary position, and to welcome my hon. Friend the Minister to her role? Can she give the House any further details of the impact of this outage in Scotland, and what conversations has her Department had with the Scottish Government in recent days?
Ellie Reeves
I welcome my hon. Friend back to the House; it is fantastic to see her, rightly, in her place. I thank her for the points that she raised, which are important and will be taken into account in the review of the lessons learned.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
I congratulate the Minister on her appointment. Does she agree that these events demonstrated that we are very far from being in a position to move to a cashless society? Given that the Chancellor is present, will the Minister confirm that her Government will do everything that they can to support the continued use of cash, which is so important to some of the most vulnerable people in society?
Ellie Reeves
Cash remains the second most commonly used form of payment in the UK, and we remain committed to ensuring that individuals and businesses have access to it. We have committed ourselves to providing 350 banking hubs, so that cash remains available to them.
Mark Ferguson (Gateshead Central and Whickham) (Lab)
It is a pleasure to welcome the Minister to her position, particularly as she is sitting alongside the Chancellor of the Exchequer. I welcome the points made about resilience in public services, but can she assure me that similar efforts are being made to ensure resilience of IT in a defence context?
Ellie Reeves
As I said in answer to an earlier question, as soon as this Government were elected, we took immediate steps to start legislating to better protect all our public services and the third-party services that they use, and the cyber-security and resilience Bill will come before Parliament.
Jim Shannon (Strangford) (DUP)
I welcome the Minister to her position. Congratulations are due to her: I understand that she was in charge of the Labour party’s election campaign, so she can take some credit for its success. It is good to see a reward for endeavours, and for hard work. I say to her: well done.
On airlines, as 171 flights were cancelled, some of my constituents were stuck in London and could not get home to Belfast. When it came to banks, some of my constituents who were out shopping found that their credit cards did not work because the system was down. When it came to the health system, the Department of Health in Northern Ireland said that hospital services and about two thirds of GP surgeries faced problems; there had been, for instance, problems getting patients into operating theatres and with accessing staff rosters. The whole system was in absolute chaos.
Does the Minister not agree that the issue has underlined the necessity of ensuring that we are prepared for cyber-breakdown, whether caused by an intentional attack or caused unintentionally? Can she say something about our preparedness for situations such as this, and about our resilience in moving forward from these technological problems, for the benefit of those in all parts of the United Kingdom of Great Britain and Northern Ireland?
Ellie Reeves
I thank the hon. Member for his kind comments. I am sorry to learn that some of his constituents were unable to secure flights home or GP appointments. In my statement, I spoke about ensuring that we expand our cyber-resilience, put regulators on a stronger footing and obtain a clear picture of cyber-threats and how they can be dealt with, and he raises important points in that regard.
Kit Malthouse (North West Hampshire) (Con)
This was an extremely serious incident that I suspect may well be detectable in the next GDP figures that come out of the Office for National Statistics. I have two questions. The hon. Lady said that she was “pleased to say that Government services, and the online services that the Government provide, were and remain largely unaffected.” Could she tell us which services were affected, or is “largely” just a euphemism for “not affected at all”?
Secondly, it is quite difficult for Members to get a handle on the full impact and spread of this contagion. Will she commit to laying before the House some kind of report detailing the sectors that were affected, how seriously they were affected—including Government systems—and whether and how there will be any resolution in the future? Obviously, we need to report to our constituents that these things are less likely to occur in the future.
Ellie Reeves
I set out the impact that the incident had on, for example, GP services, but things like the emergency services remained unaffected, as far as we are aware. We are learning the lessons from the incident, and I am sure that we will report back once that has been completed.
Mr Joshua Reynolds (Maidenhead) (LD)
Like so many others, GPs in my constituency were affected on Friday, and I thank them for the work they did. Even though patients were not able to get test results and appointments were missed, GPs managed to make sure that people received the best care possible. What assurances can the Minister give me that the lessons learned from Friday will mean that patients can continue to receive care when they need it?
Ellie Reeves
I welcome the hon. Gentleman to the House, and I place on record my thanks to GP surgeries in Maidenhead, which did what they could to make sure that the disruption for patients was at a minimum. We will undertake the lessons learned exercise from this incident; I hope that offers some reassurance to his constituents, as well as the Bill that will be going through Parliament.
Kirsty Blackman (Aberdeen North) (SNP)
I am aware that the Minister is new to her role, so I will ask her to consider things, rather than to commit to doing things. Will she please consider continuing with the annual statement to Parliament on civil contingencies and risks, which the previous Government committed to? When she looks at the cyber-security and resilience Bill, will she consider assessing whether there is widespread use of certain software or hardware that could cause mass outages in the event that it is affected, as happened with CrowdStrike? I am not aware that we have seen an analysis of that in previous outputs by the Cabinet Office, and it would be incredibly helpful for us to be aware of where those risks are.
Ellie Reeves
I thank the hon. Member for those suggestions. I am very happy to consider the points that she has raised.
Madam Deputy Speaker (Dame Siobhain McDonagh)
I cannot be the only Member who thinks how proud Mr and Mrs Reeves must be today.
Debate on the Address
Economy, Welfare and Public Services
(4 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
21:59 - The House divided: - Ayes: 111 / Noes: 390 - Question accordingly negatived.
Madam Deputy Speaker (Dame Siobhain McDonagh)
I inform the House that Mr Speaker has selected amendment (h), tabled by the Leader of the Opposition.
Jeremy Hunt (Godalming and Ash) (Con)
I beg to move an amendment, at the end of the Question to add:
“but humbly regret that there is no mention in the Gracious Speech of the improved economic conditions the Government is inheriting, with the fastest recorded growth in the G7, inflation at the Bank of England’s target for the second month in a row, and unemployment at half the rate that it was in 2010; further regret that there is no mention of how to make necessary savings on welfare; urge the Government to meet the commitment set out in the Labour Party’s manifesto not to raise taxes on working people; regret that the Gracious Speech fails to make a commitment not to use changes to reliefs to raise taxes; and call on the Government to increase income tax thresholds to prevent income tax from being charged on the State Pension.”
It is an important and rather painful part of our democracy that today I am a shadow Chancellor, responding to the King’s Speech in exactly the same way that the new Chancellor responded to me just a few months ago, so I start by congratulating her, as well as Mr and Mrs Reeves. As the father of two girls, one of whom has her 10th birthday today, I warmly welcome the smashing of a glass ceiling by Britain’s first female Chancellor. As I said on election night, she has led the Labour party on a difficult journey, which has changed it for the better. Her stated commitment to fiscal responsibility, stability and economic growth has been consistent and, I am sure, not always easy. Unfortunately for us, her success in holding the line means that we face rather a lot of Labour MPs on the Government Benches, but I wish her well in her new role.
I also commend to the right hon. Lady the superb Treasury officials she now inherits, and put on record my gratitude to them the excellent work they did for me, staying up in the middle of the night ahead of fiscal events, engaging in tense negotiations with spending Departments—and occasionally, it has to be said, with No. 10—bringing me endless flat whites and Pret lunches to keep me going and, most of all, making my family feel welcome in the goldfish bowl that is Downing Street. It is part of the magic of democracy that those same officials have seamlessly transferred their allegiance from me to her, and I know that they will serve her extremely well.
In opposition, we will not oppose for its own sake, and there are a number of Bills in the King’s Speech that we welcome. The right hon. Lady is right to focus on growth, and the improvements on planning will build on many reforms introduced by the last Government, including the 110 growth measures I introduced in last year’s autumn statement. Any boost to house building is also welcome. We delivered 1 million homes in the last Parliament, and she will soon find out that if she is to deliver 1.5 million, she will not be able to duck reforming environmental regulations—a change that Labour blocked in the last Parliament but will deliver an extra 100,000 homes. I caution her not to over-rely on bringing back top-down targets. In the end, we will build more houses only if we change attitudes to new housing, and that is unlikely to happen if unpopular targets are steamrollered through local communities.
We will also look carefully at the right hon. Lady’s Budget Responsibility Bill. We are proud that a Conservative Government set up the Office for Budget Responsibility, and I commend the work of Richard Hughes and his team. We did not always agree, but in the end, that is the point of an independent watchdog. We all understand the politics of a Bill that allows the Government to make endless references to the mini Budget, but if the right hon. Lady is really committed to fiscal responsibility alongside growth, I hope that she will today confirm that she will not fiddle with the five-year debt rule to allow increased debt through the back door. We—and, it has to be said, markets—will be monitoring the overall level of debt very carefully to make sure that that does not happen. I also hope that she will commission the OBR to do 10-year forecasts of our long-term growth rate rather than five-year forecasts, as at present, in order to bake long-term decision making into Treasury thinking.
Bill Esterson (Sefton Central) (Lab)
The shadow Chancellor was talking just now about fiscal responsibility. During the election campaign, he committed to a series of tax cuts, but I noticed that yesterday on Laura Kuenssberg’s show he said that it would not have been possible for him to proceed with those tax cuts. What has changed, and why did he make that commitment during the election campaign, knowing full well that he could not afford to carry it out?
Jeremy Hunt
I am grateful to the hon. Gentleman for that intervention, because it allows me to explain why he is completely mistaken in what he is saying. We offered a set of carefully and fully funded tax cuts—unlike the £38.5 billion of unfunded spending commitments that came from the Labour party—but we always said that they would be brought in over time over the next Parliament. We did not make a commitment that they would come in immediately, and indeed they would not have. We would have done it in a responsible way.
When it comes to dubious claims, the new Chancellor herself has been making some that do not withstand scrutiny. She said, for example, that the economy would have been £140 billion bigger if we had matched the average OECD growth rate, but she knows that the OECD is a diverse group of 38 countries, including many with economies very different from our own, such as Turkey, Mexico or Luxembourg. A much more meaningful comparison is with other similar G7 economies, which shows that since 2010 we have grown faster than France, Italy, Germany and Japan. Indeed, the International Monetary Fund says that thanks to difficult measures taken by the last Conservative Government, we will grow faster than any of those four countries, not just in the short term but over the next six years. One reason for that is our record on attracting investment.
Since 2010, greenfield foreign direct investment has been higher in the UK than anywhere in the world except the United States and China. In the last year alone, Nissan, Jaguar Land Rover, Tata, BMW Mini, Google and Microsoft have all voted for the UK with their dollars, not least because of cuts in business taxation, such as full expensing, introduced by the last Government. If the Chancellor now looks for back-door ways to increase business taxation, as many fear, she will risk the UK’s attractiveness to foreign investors, of which she is now the beneficiary.
Chris McDonald (Stockton North) (Lab)
That investment is very important to my constituents in Stockton North, where many companies are poised to make billions of pounds of industrial investment. They tell me that they prize economic stability above all else, so will the right hon. Gentleman now commit to supporting the Budget Responsibility Bill to give those investors the security they need?
Jeremy Hunt
Yes, we are minded to support the Bill, subject to having had a close look at it, because we think it is perfectly sensible. Whether it is completely necessary is a different question, but it is perfectly sensible.
We have grave concerns about some elements of the King’s Speech, with a Times editorial this week describing some of its Bills as
“a dose of traditional socialist dogma”.
Tony Blair came to office having removed the old clause IV of the Labour party constitution, because he knew that state-run businesses are rarely successful and usually end up being bailed out by the taxpayer. Last week, with their railway and energy plans, the Government brought forward more nationalisation than Blair ever did—indeed, more than any Government in modern times.
If the Chancellor really cares about fiscal responsibility, she should beware. The reason why unions like publicly owned utilities is that they give them more leverage on pay and more ability to demand bail-outs. Unlearning the lessons of history will mean more strikes and bigger bills for the taxpayer.
An even bigger concern for business is the impact on jobs of Labour’s new deal for workers. We have seen the creation of almost 4 million jobs since 2010, which is nearly 800 jobs for every single day that Conservative Governments were in office. The president of the Confederation of British Industry described the UK as a “job-creation factory” but, like many others, he expressed concern that the Deputy Prime Minister’s new labour laws could put that at risk.
Day one rights sound attractive, but employers fear they will mean a flood of tribunal claims, meaning it is safer not to offer a job at all. That is why the Federation of Small Businesses responded to the King’s Speech by saying that companies are worried about increased costs and risks. In the end, French-style labour laws will lead to French levels of unemployment, which are nearly double our own—indeed, they are close to what they were when the last Labour Government were in office. By contrast, the Conservatives nearly halved unemployment over the last 14 years, and it would be a tragedy for working families up and down the country if the new Government turned the clock back.
Finally, the most dubious claim of all is this nonsense about the Government having the worst economic inheritance since the second world war, which everybody knows is just a pretext for long-planned tax rises. People can see what nonsense this is by simply comparing it with the last time we had a change of Government in 2010. Inflation was 3.4%, compared with 2% today. Unemployment was 8%, compared with 4.4% today. Growth was forecast then to be among the slowest in the G7, compared with the fastest today. Instead of an economy in which markets and the pound were facing meltdown, the Chancellor has inherited an economy in which the Office for National Statistics has said that growth is “going gangbusters.”
That has been backed up by even more data since the election. May’s GDP figures show that Britain’s growth was double the rate predicted by economists, and the fastest in more than two years. New figures from S&P show that, in February, British businesses were among the most optimistic in the world—top of the league again, according to the ONS. Inflation has remained at its 2% target level.
In her BBC interview yesterday, the Chancellor glossed over those figures, putting on the most shocked expression she could muster, to pretend that public finances are worse than she expected. But the root cause of the pressure on public finances—£400 billion in pandemic support and £94 billion in cost of living support—was never a secret. Indeed, the Labour party supported those measures and, in some cases, called for us to go further. Nor were the difficult decisions we had to take to pay for them a secret either. When we had to increase borrowing, increase tax and reduce spending plans in the autumn statement of 2022, Labour did not oppose us.
Like all Chancellors, she faces fiscal challenges: welcome to the job. But that job is a whole lot easier because, faced with an economic crisis two years ago, Conservatives took decisions that her predecessor Labour Government ducked completely after the financial crisis. That is why she has a deficit of 4.4% this year compared with 10.3% left behind for the Conservatives in 2010. She did not just compare her inheritance to 2010; she claimed to have the worst inheritance since the second world war. Is she really saying that she faces conditions worse than Geoffrey Howe in 1979, with a winter of discontent, stagflation, an 83% top rate of tax and a Labour Government who went with a begging bowl to be bailed out by the IMF? The Chancellor knows perfectly well that that claim is nonsense, otherwise why, in her first week, would she announce £7.3 billion of spending on her national wealth fund, without a spending review, a budget or any external validation from the OBR? As Paul Johnson of the Institute for Fiscal Studies says, thanks to the OBR the nation’s books are “wide open” and “fully transparent”, so pretending things are worse than expected “really won’t wash.” As she establishes her reputation, it is surely unwise to base her big central argument on a claim so patently ridiculous.
But we all know exactly why the Chancellor is doing it. She wants to lay the ground for tax rises she has been planning all along, which leads to two major concerns. First, she says her No. 1 mission is growth, but all around the world, evidence suggests countries with higher taxes tend to grow more slowly. Lower taxes, when funded properly, boost growth, as we saw with full expensing and the national insurance cuts last year, both of which the OBR confirmed add to our GDP. However, keeping taxes down is hard work.
I saw the numbers the Chancellor has seen just a few weeks ago, and the official advice was clear: with public sector pay restraint, productivity plans such as those we announced in the Budget, and welfare reform, it is perfectly possible to balance the books without tax rises. It is not easy—government never is—but not impossible. Yet all those three things—pay restraint, productivity improvements and welfare reform—were glaringly omitted from the King’s Speech. Instead, she has chosen an easier path: what Labour party sources told The Guardian was a “doctor’s mandate” to raise taxes.
The Chancellor has ruled out raising income tax, national insurance and VAT, but she should not think for one second that other tax rises will not impact working people. Capital gains tax destroys the pensions people build up over their lifetimes; business tax rises are passed on to customers, leading to higher bills; and taxes on banks and energy companies lead to fewer companies operating in the UK, a lower tax take and less money for public services such as the NHS.
That is the biggest contradiction in the new programme —a Government who say they want the fastest growth in the G7 but, in the very same breath, plan tax rises that will make that growth harder, if not impossible, to achieve. Even if such an approach were misconceived, it is none the less a legitimate choice for a governing party. What is not acceptable is, just 18 days after the election, to be laying the ground for tax rises after the Chancellor promised us 50 times in the election campaign that she had no plans to raise them. Every Labour Government in history have raised taxes and raised spending. If she wanted to do the same, she should have had the courage to make the case for that before the election. Instead, she is softening us up for a colossal U-turn that will lead to lower growth, less money for public services and massive public anger, which is why I commend to the House the amendment in the Opposition’s name.
The Chancellor of the Exchequer (Rachel Reeves)
It is a pleasure to open today’s King’s Speech debate on behalf of His Majesty’s Government. I always enjoy debating with the right hon. Member for Godalming and Ash (Jeremy Hunt), though I must say I rather prefer doing so from this side of the Chamber. [Hon. Members: “Hear, hear.”]
I appreciate the shadow Chancellor’s generous words on my appointment and also his tribute to officials, who I can confirm are indeed first rate. It has been more than 14 years since a Labour Government were in office for a state opening of Parliament—14 years of chaos, 14 years of economic irresponsibility, 14 years of wasted opportunities and 14 years since there has been a Labour Chancellor of the Exchequer standing at this Dispatch Box. Today, I pay tribute to my most recent Labour predecessor, the late Lord Darling. He was an outstanding Chancellor, a kind man and a good friend.
Mr Speaker, it is also the very first time that there has been a female Chancellor of the Exchequer. On my arrival at the Treasury, I learned that there is some debate about when the first Chancellor was appointed. It could have been 800 years ago, when one Ralph de Leicester was given the title of “Chancellor of the Exchequer” for the first time, or, 900 years ago, when “Henry the Treasurer” was referenced in the Domesday Book. It could even have been 1,000 years ago, when Alfred the Great was in effect the first Master of the Mint. Whichever it is, I am sure the whole House would agree on one thing—that we have waited far too long for a woman to be the Chancellor of the Exchequer. [HON. MEMBERS: “Hear, hear.”]
I stand here today proud, but also deeply conscious of the responsibility that I now have: a responsibility to women across the country whose work is too often undervalued; and a responsibility to every young woman and girl, who should know that there is no ceiling on their ambitions and no limit on their potential.
Sarah Edwards (Tamworth) (Lab)
Seven Tory men have stood at that Dispatch Box over the past 14 years and the result has been an economic crisis, crumbling public services and a cost of living crisis. Can we expect a change of approach from the new female Chancellor of the Exchequer?
Rachel Reeves
One thing is that I hope to be in post for a bit longer than some of my predecessors.
As tempting as it is, I do not intend to conduct a full sweep of the past 1,000 years of economic history from the Dispatch Box today—[Hon. Members: “Ah”!] I am sorry. However, we must talk about the past 14 years. I warned that whoever won the general election would inherit the worst set of circumstances since the second world war, and I have seen nothing to change my mind since I arrived at the Treasury. I will update the House on our public spending inheritance before Parliament rises for recess.
I heard what the shadow Chancellor said from the Dispatch Box now and on the television yesterday, which was to claim that I should be grateful for what he has left us. That is unbelievable, because he knows the truth and is now trying to rewrite history. In doing so, he has reminded the British people why the Conservatives lost the election. They are out of touch, deluded and unable to defend the indefensible. In the weeks ahead, it will become clear what those in his party did. They stored up problems, failed to take the tough decisions and then they ran away, leaving it to us—the Labour Government—to pick up the pieces and clear up their mess.
Today, I want to focus on one thing above all else: economic growth. Since 2010, Conservative Chancellor after Conservative Chancellor, including the now shadow Chancellor, stressed the importance of growth. We have had more growth plans than we have had Prime Ministers or Chancellors, and that is quite a lot, but growth requires more than talk; it requires action. Like so much else with the previous Administration, when we scratch beneath the surface the façade crumbles, and all that is left is the evidence of 14 years of failure.
Matt Western (Warwick and Leamington) (Lab)
I congratulate my right hon. Friend on her appointment; she is making an excellent speech. Friday’s ONS report showed that public sector borrowing was 25% higher than forecast. Does she agree that that underlines why it was so important to have a fully costed and fully funded manifesto to restore confidence in the public finances, and that it was a surprise that certain other parties did not follow the same route?
Rachel Reeves
I thank my hon. Friend for that question. He speaks powerfully, and I pay tribute to his work in the last Parliament, particularly around education and skills. This is a really important point. For me, the most important pages of the manifesto that we stood on were the three grey pages at the back of it, which set out all our spending commitments and how they would be paid for. That was important, because to earn the trust of the electorate parties must be really clear about where the money will come from and what they will use it for. That is what we did in our manifesto, and it is what we will do in Government.
The shadow Chancellor made some points about GDP, comparing ours with that of other countries, but since 2010 UK GDP per capita—that is the most important measure, because it reflects how people feel and the money that they have—has grown slower than the G7 average, slower than the EU average, and slower than the OECD average. Treasury analysis that I requested when I became Chancellor shows that, had the UK economy grown at the average OECD rate these last 14 years, our economy would be over £140 billion bigger today. That could have brought in an additional £58 billion of tax revenues in the last year alone—money that could have been used for our schools, hospitals and other vital public services. Growth is about more than just lines on a chart; it is about the money in people’s pockets, and Treasury analysis shows that achieving the rate of growth of similar economies would have been worth more than £5,000 for every household in Britain.
The shadow Chancellor stood up and once again claimed that he bequeathed a great legacy. Seriously? The last Parliament was the first on record where living standards were lower at the end than at the start. The highest level of debt since the 1960s, the highest tax burden in 70 years, mortgages through the roof, the economy only just recovering after last year’s recession, economic inactivity numbers last week showing a further rise, and borrowing numbers last week showing over £3 billion more borrowing than the OBR expected—that is the Conservatives’ legacy. If that is a good inheritance, I would hate to see what a bad one looks like. I think deep down the shadow Chancellor knows that. In fact, he does know it.
Yesterday, the shadow Chancellor admitted what we all know: that the manifesto that he campaigned on was undeliverable, and the money for the tax cuts that he promised simply was not there. If he wanted to show the country that his party has listened, and learned from its mistakes, he would have used his speech this afternoon to apologise, but he did not, and that tells us everything that we need to know about this Conservative party: party first, country second; political self-interest ahead of the national interest; irresponsibility before the public good. Let me say this to the Conservative party, “We will not stop holding you responsible for the damage that you have done to our economy and to our country.” Never again will we allow the Conservatives to crash our economy. They failed this country. They shied away from tough choices, and we will not repeat their mistakes. It falls on us, this new Labour Government, to fix the foundations so that we can rebuild Britain and make every part of our country better off. We will govern through actions, not words, and we have already begun to do just that, because there is no time to waste.
Less than 72 hours after I was appointed as Chancellor, I put growth at the very heart of our work. Working alongside my right hon. Friend the Deputy Prime Minister, I set out reforms to our planning system—reforms that the Conservative party did not deliver in 14 years. Our reforms restore mandatory targets to build the homes that we desperately need, end the absurd ban on onshore wind to deliver home-grown cheap energy and recover planning appeals for projects that sat on the desks of Ministers in the last Parliament for far too long. Those are tough decisions that the Conservative party already opposes.
Why was that my first act as Chancellor? Because getting our economy growing is urgent, and this King’s Speech shows that we are getting to work.
Mr Mark Francois (Rayleigh and Wickford) (Con)
On the matter of mandatory housing targets, having been a constituency MP for 23 years and seen them tried in a number of different ways, may I humbly offer the Chancellor this, with all sincerity? There is such a thing as good development, but it only works if it is something that we do with people and not to people. This Stalinist approach will not work.
Rachel Reeves
I have been compared to a lot of things, Madam Deputy Speaker, but I have never been compared to Joseph Stalin.
Our approach is a brownfield-first approach. We will reintroduce those mandatory targets; of course it is up to local authorities and local communities to decide where the housing should be built, but the answer cannot always be no. If the answer is always no, we will continue as we are, with home ownership declining and mortgages and rents going through the roof. On the Government side of the House, we are not willing to tolerate that.
This King’s Speech shows that we are getting to work. As my right hon. Friend the Prime Minister set out, our programme for government is founded on principles of security, fairness and opportunity. Our No. 1 mission is to secure sustained economic growth in our great country through a new partnership between Government, business and working people that prioritises wealth creation for all of our communities.
We will fix the foundations of our economy so we can rebuild Britain and make every part of our country better off. There are a number of important pieces of legislation in the King’s Speech that will help us to grow the economy. In this speech, I will focus on three in particular: the Budget Responsibility Bill to restore economic stability, the national wealth fund Bill to drive investments and the pension schemes Bill to reform our economy. Those Bills speak not just to our programme for government, but also to trust in politics. They show that we will govern as we campaigned and that we will meet our promises to the British people.
In the election campaign, I said the first step we would take would be to restore economic stability, because stability is the precondition to a healthy, growing economy. It is how we keep taxes, inflation and mortgages as low as possible. After years of irresponsibility, we are putting our economy on firm ground once again. We introduced the new Budget Responsibility Bill on Thursday to deliver on our manifesto commitment to introduce a fiscal lock so that I can keep an iron grip on our country’s finances.
Kit Malthouse (North West Hampshire) (Con)
The Chancellor and I sat on the Treasury Committee together many years ago, and she will know from our time together that economics is as much art as it is science. Given that she is effectively giving a veto over economic policy to the OBR through this Bill, she must recognise that we need to understand what the people in the OBR believe, what their theories of economics are and what principles they attach themselves to. What further scrutiny of the chair of the OBR and the people doing the forecast will be available to this House, given that effectively they will be co-Chancellor with her during the next few years?
Rachel Reeves
The Treasury Committee, as the right hon. Gentleman knows, can call in the chair and other members of the Office for Budget Responsibility, but his comments show exactly why we need this Bill: so that never again can we have a repeat of the mini Budget. The Bill will require every announcement that makes significant permanent changes to tax and spending to be subject to an independent assessment by the Office for Budget Responsibility. Why? Because unfunded, reckless commitments do not just threaten our public finances; they threaten people’s incomes and they threaten people’s mortgages. We saw that in the wake of the mini-Budget presided over by the former Member for South West Norfolk. I understand that she has taken umbrage in recent days at the idea that that episode was disastrous. Well, if any Conservative Member would like to dispute that fact today, I would be more than happy to give way. [Hon. Members: “Come on then!”] They cheered it at the time, but they are not cheering it now, and I do not imagine that they would put it on their leaflets.
The Conservatives should be ashamed of what they did because people up and down the country are still paying the price for the chaos that they caused. We say: never again. The Budget Responsibility Bill will enshrine that commitment in law.
Mr Luke Charters (York Outer) (Lab)
During the pandemic, the friends and family of Conservatives were awarded contracts for work that were never fulfilled. My constituents would love to know how we can get their money back, perhaps through the covid corruption commissioner.
Rachel Reeves
I enjoyed campaigning for my hon. Friend in York Outer, and it is great to see him in his place today. Stability means a tough set of fiscal rules, but it also means spending public money wisely, as he says. The last Government hiked taxes while allowing waste and inefficiency to spiral out of control. At no time was that more evident than during the pandemic, especially when it came to personal protective equipment. The former Prime Minister, when he was Chancellor, signed cheque after cheque after cheque for billions of pounds-worth of contracts that did not deliver for the NHS when it needed it—that is simply unacceptable.
Today, I can announce that I am beginning the process of appointing a covid corruption commissioner to get back what is owed to the British people. That money, which is today in the hands of fraudsters, belongs in our public services, and we want it back. The commissioner will report to me, working with the Secretary of State for Health and Social Care, and their report will be presented to Parliament for all Members to see. I will not tolerate waste. I will treat taxpayers’ money with respect and return stability to our public finances.
The second Bill I will speak to is the national wealth fund Bill. We know that economic stability is vital for investors and for business—the small business looking to grow; the global business looking to expand in the UK; the entrepreneur looking to take their first steps. To support them, stability must sit alongside investment.
Andrew George (St Ives) (LD)
On the effective use of public funds, is the Chancellor aware not only of the alleged corruption in the way that covid aid was distributed, but of the large number of tax loopholes in this economy? For example, in Cornwall, over £500 million of taxpayers’ money was handed out to holiday home owners not only through covid aid but through the small business rate relief scheme and other tax loopholes. At the same time, only a third of that amount has gone into social housing for first-time users. Will she look at the whole issue of parity in the way public funds are used, to support people who need housing?
Rachel Reeves
I welcome the hon. Member back to this place. I enjoyed sparring with him in my early days in Parliament, and it is great to see him back in the House. He is absolutely right that we need to get value for money for all tax incentives. I will ensure that the Treasury and the Ministry of Housing, Communities and Local Government look at the changes that he suggests.
The last Government’s record on investment was dismal. We now sit behind every single member of the G7 when it comes to business investment as a share of GDP. That is not an abstract economic problem. Weak investment holds back productivity and hurts living standards; it leaves households poorer and wages lower.
The King’s Speech deals directly with the need to unlock private investment through a new national wealth fund Bill. That will be supported by an injection of capital, part funded by an increase to the windfall tax on oil and gas giants. It will make transformative investments in industries of the future, such as carbon capture and storage, and green hydrogen. It will mobilise billions of pounds-worth of additional private sector investment in our industrial heartlands and coastal communities while generating a return for taxpayers. The national wealth fund will work with local partners including mayors, as well as the devolved Administrations in Scotland, Wales and Northern Ireland, to develop an investment offer that meets the needs of all our nations and regions. It will simplify a complex landscape of support for businesses today, aligning key institutions such as the UK Infrastructure Bank and the British Business Bank under the one banner of the national wealth fund.
Barry Gardiner (Brent West) (Lab)
I heartily applaud what my right hon. Friend is saying about the renewed windfall tax. Will she also look at the fact that, in this country, we have the lowest basic rate of tax on oil and gas companies anywhere in the world? The average is 74%; in this country, it is 38%.
Rachel Reeves
As my hon. Friend knows, we committed in our manifesto to a three percentage point uplift to the current energy profits levy, which we will use to fund the national wealth fund. That fund will power jobs and prosperity in all parts of our country, and that work is already well under way. In my first week in office, I welcomed the report of the national wealth fund taskforce, and I thank the former Governor of the Bank of England, Mark Carney, and the whole taskforce for their outstanding work. This Bill will put the national wealth fund on a statutory footing with clear objectives, crowding in private investment to create wealth across Britain.
Deirdre Costigan (Ealing Southall) (Lab)
Under the Conservatives, businesses and working people were held back by a complete and abject failure to build the new homes that my constituents in Ealing Southall were crying out for, the laboratory spaces that will provide the jobs of the future, or the national infrastructure needed for businesses and working people to prosper. Will my right hon. Friend assure this House that, under her chancellorship, we will finally get Britain building again?
Rachel Reeves
I welcome the election of my hon. Friend in Ealing Southall—I think her constituents and the whole House can see what a strong advocate she will be for her local community. She is absolutely right: we have to get Britain building again. We have to build the homes and the transport, energy and digital infrastructure that our country desperately needs.
Jim Shannon (Strangford) (DUP)
I thank the Chancellor for giving me the chance to intervene. When it comes to rebuilding and the house building programme that she has suggested should happen, in the papers today, it is suggested that people on a wage of £70,000 cannot get a mortgage. In Northern Ireland, those on a smaller wage cannot get a mortgage either, so can I ask the Chancellor this direct and hopefully positive question, which will hopefully receive a positive answer: what can she do to improve access to mortgages for those who want to own their accommodation, rather than rent it? What can she do to make sure that everyone in the United Kingdom of Great Britain and Northern Ireland can benefit, as she has clearly said they will?
Rachel Reeves
I thank the hon. Gentleman for that intervention. One of the biggest challenges people face with getting a mortgage is building up the deposit. That is why we have committed to a mortgage guarantee scheme, to help those people who cannot rely on the bank of mum and dad to get on the housing ladder. That is a really important commitment, as is our commitment to build the homes: unless we build more homes, home ownership will continue to go backwards, as it did over the past few years.
Alongside stability and investment in our economy must come reform, because delivering economic growth requires tough choices. It means taking on vested interests and confronting issues that politicians have too often avoided. The last Government refused to engage with those choices, and refused to level with the British people about what was required. This Government will be different. We have already demonstrated that through a series of reforms to our planning system, and are bringing forward further legislation in the King’s Speech to get Britain building.
Today, I want to focus on another area of our economy where reform is vital: our pension schemes. People across our country work hard to save for the future; they want a better, more secure retirement with the most generous pension possible. At the same time, British businesses with high growth potential need capital to support their expansion. Pension funds are at the heart of this. There will soon be over £800 billion of assets in defined contribution pension schemes, but for too long, those assets have not been targeted towards UK markets. That has impacted British savers, and it has impacted British business.
The last Government also said that this was a problem, and I welcome that acknowledgement, but they never introduced the legislation needed to make the change. We believe in deeds, not words, so we will strengthen investment from private pension providers by bringing forward the pension schemes Bill in the King’s Speech. It will boost pension pots by over £11,000 through a new and improved value for money framework. Through an investment shift in DC schemes, just a 1% shift in asset allocation could deliver £8 billion of new productive investment into the UK economy.
To ensure that the Bill is as strong as possible, I am today launching a pensions investment review, led by the first ever joint Commons Minister appointed between the Treasury and the Department for Work and Pensions—my hon. Friend the Member for Wycombe (Emma Reynolds), the Pensions Minister. This will include a review of the local government pension scheme, the seventh largest pension fund in the world, to ensure it is getting the best value from the savings of nearly 7 million public sector workers, the majority of whom are women and the majority of whom are low-paid. They deserve a pension that is working for them. Together, these reforms will kick-start economic growth by unlocking investment that has been tied up for too long.
Madam Deputy Speaker (Dame Siobhain McDonagh)
Order. Could I just urge the House to think about interventions? There is a very long list of Members who want to speak and lots of people who want to make their maiden speech, and it would be great if they could all get in.
Rachel Reeves
Madam Deputy Speaker, you will be pleased to know that I will not apprise the House of every Bill that supports economic growth in the King’s Speech. Needless to say, there are many more—from the English devolution Bill to transfer power back into the hands of local communities to the employment rights Bill to make work pay, and the Great British Energy Bill to take back control of our country’s energy and create new jobs across the United Kingdom. Growing our economy flows through almost every word of this Address.
The British people put their trust in us on 4 July to fix the foundations of our economy, to rebuild Britain and to make every part of our great country better off. I do not take that trust for granted. We will not let people down, and I am ready to deliver the change that we need. I know it will take time and I know it will require hard work, but we are already getting on with the job by ending a reckless, chaotic approach to economic management, by putting politics back in the service of working people and by making economic growth our fundamental mission. I commend the Address to the House.
Sarah Olney (Richmond Park) (LD)
Thank you, Madam Deputy Speaker. It is a pleasure to see you in the Chair.
It is a real pleasure to contribute to the debate on behalf of the Liberal Democrats, not just because I am speaking on behalf of so many more of them than I used to, but because it gives me an opportunity to welcome the Chancellor of the Exchequer to her place and express my personal congratulations on becoming the first woman in the UK’s history to hold the position. I am personally delighted. I spent many years working in banking and finance, and I know how male-dominated those industries still are. I wish her well in her new role and look forward to working with her over the coming Parliament. The Liberal Democrats will be vigorous in scrutinising her plans, but we will always work in the national interest, and I can assure her of the support of the Liberal Democrats on all those matters on which we can agree.
I am sure that one of the things on which we can certainly agree is that the right hon. Lady and her colleagues have received a dismal inheritance from the departing Conservative Administration. The numbers reveal a dispiriting picture of low growth, high interest rates and a record fall in living standards delivered by an out-of-touch and incompetent Conservative party that took people for granted for years. Our constituents see this situation reflected in the increases in their mortgage payments, the hike in their energy bills and the prices they pay at the tills for their weekly shop. They see it in public services that are in a state of crisis and an NHS that is failing to deliver the care they need. The Liberal Democrats welcome the seriousness with which this King’s Speech focuses on stability, reinvesting in our crippled public services and growing the economy.
We welcome measures such as the introduction of an industrial strategy council to co-ordinate policy on economic growth, but the immediate and pressing problems that our constituents are facing in their everyday lives cannot just be addressed by centralised, top-down institutions run from Whitehall. Our economy needs to grow from the bottom up, bringing prosperity to every community, taking away the barriers to entry for small businesses and enabling individuals across the country to make the most of their skills and talents. The Liberal Democrats want urgent measures introduced to give immediate support to families and small businesses.
While out on the doorsteps during the general election campaign, I and my 71 colleagues heard a clear message from our constituents that their biggest priority was fixing the NHS. We are here because we promised to fight hard for a better NHS for our constituents and for communities across the country. That is why we are calling for the Chancellor to immediately draw up a Budget for health and social care. We cannot deliver economic growth without fixing the crisis in our NHS and in social care. NHS waiting lists are at an all-time high; it can take weeks to see a GP and it is now almost impossible to see an NHS dentist. Everyone deserves access to the care they need when they need it and where they need it. A successful health and social care system is fundamental to a fair society and our country’s prosperity.
The failures of the Conservative Administration led to a dramatic increase in the number of people experiencing long-term sickness conditions and the Liberal Democrats will continue to push for public service investment to help reduce NHS waiting lists to get people back to work.
Ben Maguire (North Cornwall) (LD)
Does my hon. Friend agree that reforming social care should be one of the most urgent priorities of this Government? The Royal Cornwall hospitals NHS trust recently announced that £26 million a year is spent on patients who are medically well but unable to be discharged due to a lack of social care packages.
Sarah Olney
My hon. Friend is right, and it is wonderful to see him in his place; the people of North Cornwall will be well served by his championing of social care, which was front and centre of the Liberal Democrats manifesto in the general election.
The most direct way to alleviate poverty is to increase the money paid to the poorest households. We know that our fellow citizens who are living in the severest poverty are likely to be families with small children. Growing up in poverty affects children’s educational chances and is likely to impact their physical and mental health, holding them back from achieving their true potential. Taking immediate steps to tackle child poverty should therefore be a priority. We believe that removing the two-child cap is the most cost-effective way of immediately lifting 500,000 children out of poverty, while helping to make costs more manageable for parents. That would have a direct benefit to families struggling with the cost of living crisis. Not only do we have a moral obligation to change this unnecessary policy but it is the most cost-effective way of alleviating poverty with a broad range of economic advantages, including supporting more parents back into the workforce. So I urge the Chancellor of the Exchequer to remove the two-child limit on social security payments in her Budget to ensure that all families who need it receive immediate reassurance and support.
But families of all sizes are suffering under the cost of living crisis and desperately need help. Our schools are increasingly having to battle the effects of poverty to ensure children are able to attend school and have the best chance of reaching their potential, and too many children are distracted from their lessons because they have not had enough to eat. The Liberal Democrats set out plans in our manifesto for free school meals for all children living in poverty, with an ambition to extend them to all children once public finances allow. The Liberal Democrats are calling on the Government to consider funding free school meals as a priority to alleviate the pressure on the finances of the families who are struggling the most. This will also contribute to positive educational outcomes that will benefit us all in the future.
The Liberal Democrats welcome many of the measures in the King’s Speech that aim to boost economic growth, and we support the Government’s objective to make that a priority. We welcome moves to boost stability and provide strategic leadership via an industrial strategy council and to increase investment through pension reform. However, our small businesses and local high streets need immediate support, and the Government need to do more to ensure economic growth can reach every part of the United Kingdom and that small businesses and entrepreneurs can quickly rediscover the confidence that they need to invest after years of Conservative chaos and mismanagement. Liberal Democrats want to see more direct support which will impact local community businesses. We believe we need swift action specifically to tackle high energy costs and we continue to call for business rate reform.
A new Parliament presents a real opportunity to begin to properly rebuild our trading relationships with Europe. From speaking with many small business owners I understand the pressures and limitations that current trade deals with Europe pose to businesses. We must tackle the arduous legislation around importing and exporting goods, which significantly limits the opportunities for small businesses to grow. The Liberal Democrats have a comprehensive plan to rebuild trust and co-operation with Europe, and we understand that to be a crucial aspect of the support that businesses urgently need. We welcome the Government’s acknowledgment of the need to reform the apprenticeship levy. However, we would like to see them go further and replace the current scheme with a broader and more flexible skills and training levy. We hope that the Government will join us in encouraging the take-up of apprenticeships, particularly for young people, and support our calls to guarantee that they are paid at least the national minimum wage by scrapping the lower apprentice rate. We understand the broad economic benefits of supporting the development of skilled workers and are optimistic about the advantages that can bring to business.
The recent years of chaos and irresponsible Conservative administration have left a substantial challenge for the new Government to tackle. We do not underestimate the work lying ahead to get the economy back up and running, to nurture an environment that will allow businesses to thrive and to restore the public services that provide care for people when they need it. My Liberal Democrat colleagues and I will hold the new Government to account to ensure that they deliver on the promises outlined by His Majesty on Wednesday as we work to rectify the damage done by the Conservatives: rebuilding our economy, supporting individual communities and small businesses, and urgently investing in health and social care.
Several hon. Members rose—
Madam Deputy Speaker (Dame Siobhain McDonagh)
The dilemma we face is self-evident: many hon. and right hon. Members want to speak, and we will do all we can to get in as many people as possible. Unfortunately, there will now be a five-minute limit on speeches. The clock will not be used for maiden speeches, but we ask Members to keep an eye on the time.
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
It is an honour to speak in this King’s Speech debate, and a privilege to have heard the first female Chancellor in our history deliver such a remarkable opening salvo. I will say a word not just about the King’s Speech itself, but the strategy behind it. When the Chancellor and my right hon. Friend the Prime Minister launched our manifesto, there was a clear ambition at its heart to ignite a revolution in wealth creation in this country not just for some, but for all. That strategy was absolutely right, because among the worst of our inheritance is the scandal—the moral emergency —of the inequality of wealth that now scars our country.
Madam Deputy Speaker, you and I could take a walk this afternoon down to a coffee bar called Shot in Mayfair, which would serve us coffee for £265 a shot. We could go next door to a restaurant Aragawa, where they serve steak for £900 apiece. Some, if they were lucky enough, could book a night at the Raffles hotel for £25,000. These are extraordinary prices, but not unremarkable in a country that now has the highest sales of Rolls-Royces, superyachts and private jets. This absurdity of affluence sits alongside a country where, on the last figures, more than 1,000 people died homeless, tens of thousands of people are dying from the diseases of poverty, and 2.1 million people can put food on the table only because of the tender mercies of food banks. That is the inequality of wealth bequeathed to this Government. It is best illustrated perhaps by one figure: the wealth of the top 1% has grown by 31 times the wealth of everybody else over the past 14 years. That is why my right hon. Friend the Chancellor was right to say that there has to be a revolution in wealth creation in this country—not just for some but for all.
The measures that my right hon. Friend has set out are the right ones: a plan for growth and a plan to devolve economic power out of the paralysis of Westminster and Whitehall and down to mayors and local councils. Alongside that is a revolution in planning law, infrastructure law and skills finance. I urge my friends on the Government Front Bench to maximise the amount of power held locally, because it is local people and local leaders who know best how to grow our economy. If we have a growing economy, the key is then to ensure that growth is fairly shared. That is why the employment rights Bill is so important. As my right hon. Friend said, there has not been growth in living standards for more than 14 years. That is why we need to ensure that there is a fair day’s pay for a fair day’s work.
Alongside that, the draft equality Bill is extremely important, and I urge my right hon. Friend to go further and to use the consolidation of pension funds to inaugurate an era of civic capitalism in this country, where we use the combined £2 trillion-worth of pension savings to encourage businesses that are good, not businesses that are bad, such as those that she revealed when she was a brilliant Chair of the Business and Trade Committee, or the scandals that we exposed in the last Parliament with McDonald’s, Asda and other firms behaving in a way reminiscent, frankly, of Victorian capitalism.
Once we have begun raising incomes, we must help people build well. That is why the changes to the housing market that my right hon. Friend proposed are so important. We can underpin that and maximise investment into the infrastructure of this country by ensuring that there is a national wealth fund, but I would go further, and I ask her to look at how we can put together not just the national wealth fund but the Crown estate fund, which is set for reform under a Bill in the King’s Speech.
We could go a step further and review the whole portfolio of investments held by the Government and by UK Government Investments. The last Government made some pretty strange investments during covid, including, I understand, buying shares in Bolton Wanderers, shares in a bespoke boutique whisky company, and even, it is said in some newspapers, shares in a strange firm that organises international sex parties called Killing Kittens. I say to my friends on the Government Front Bench that it is time we had a Domesday Book that consolidated assets in this country. Let us look at what we need and what we do not. Crucially, let us look at how we maximise dividends going to ordinary working people in this country to help them build wealth for themselves.
I conclude with this: on the Government Benches, we have long known that we only deliver and maximise freedom and opportunity for people in this country, and make those freedoms and opportunities real, if there is security. There is no security without wealth, which is why the ambition that my right hon. Friend set out not simply to build a wealthy democracy but a democracy of wealth, is the right one.
Dame Harriett Baldwin (West Worcestershire) (Con)
May I start by adding my congratulations to the Chancellor on being the first woman to hold that office in the history of our country? At this rate, the Labour party might even have a female Prime Minister some time this century. I also thank the shadow Chancellor, my right hon. Friend the Member for Godalming and Ash (Jeremy Hunt) for everything he did while in office. In particular, I thank the voters of West Worcestershire for returning me here for the fifth time.
I was one of those who was here in 2010. It is ironic that I should be following the right hon. Member for Birmingham Hodge Hill and Solihull North (Liam Byrne), because he was the one who left that famous note, “I’m sorry: there is no money left.” If people want to know what a bad economic legacy looks like, I was here in 2010 when we received one from the Labour party. The deficit was over 10% and rising and unemployment was over 8%. Inflation was nearly twice its target, and the banking system had just collapsed and had to be bailed out by taxpayers. We can contrast that with the economic legacy of 2024 that the new Government inherit.
Despite the economic costs of the pandemic and the energy crisis, the UK is enjoying the fastest growth in the G7. Unemployment is now half the rate it was in 2010. Inflation is back on target. We have a well-capitalised banking system, almost completely out of taxpayers’ hands. Wages are now rising faster than inflation. We are the fourth-largest exporter in the world. Members do not have to take my word for it; they can take the words of the International Monetary Fund, which in a recently published report said that
“the UK economy is approaching a soft landing”,
with
“growth recovering faster than expected…inflation has fallen faster than was envisaged…The banking system remains healthy”.
So I approach the economic measures in the King’s Speech with a degree of trepidation, because they come at a time when the economy was back on track. While I agree that “securing economic growth” is a fundamental mission of government, I would add the word “non-inflationary”. I have looked and looked through this King’s Speech, and I cannot see any measures that magic up economic growth. Growth does not just happen because it is written into the King’s Speech.
In my time as Chair of the Treasury Committee, we had the opportunity to have a private session with the IMF. It is interesting to observe that many of the measures put forward by the Government in the King’s Speech were in the IMF’s prescription for the UK economy. Reforming planning and building on our beloved green belt were from the IMF, as was strengthening the role of the Office for Budget Responsibility and crowding in private capital on net zero projects via a national wealth fund.
What else does the IMF want? Well, colleagues may not be surprised to learn that it also wants to see more taxes. It does not quite say it like that—it calls it “closing tax loopholes” or “mobilising additional revenues”. Some of the measures we heard about in our private session with the IMF were as follows. The first was setting capital gains tax rates in line with income tax rates. I hope that Ministers will rule that one out. The second was subjecting the sale of primary residences to capital gains tax. I hope that Ministers will rule that one out. The third was ending inheritance tax loopholes for pensions, family businesses and farms. I hope that Ministers will rule that one out. The fourth was revaluing all of England’s homes for council tax, and especially those over £320,000 in value. I hope that Ministers will rule that one out. The IMF also liked the idea of road pricing; I hope that Ministers will rule that one out. It also wants to bring forward considerably the date at which the state pension age increases.
Given that those are all tax measures that the IMF recommends, I am sure that the Chancellor is beginning to contemplate them. When the Government respond to today’s debate, I hope that they will specifically rule those things out, because the tax rises that the Government admit to already—the pensioner tax, the tax on education, and regulatory costs galore—are bad enough. Let us hear some specific denials on those other taxes.
Madam Deputy Speaker (Dame Siobhain McDonagh)
I call Georgia Gould for her maiden speech.
Georgia Gould (Queen’s Park and Maida Vale) (Lab)
I am pleased to speak in a debate with so many strong female representatives, including the hon. Member for West Worcestershire (Dame Harriett Baldwin), and I am really honoured to speak in a debate led by the first female Chancellor of the Exchequer, who has shown today what a force for change she is. I have found it incredibly moving to hear MPs across the House talk with such love and dedication about the places they represent. It has given this Parliament a deep grounding in the stories of people from every part of the UK.
I feel deeply the trust put in me by the people of Queen’s Park and Maida Vale. In speaking here, I stand on the shoulders of some extraordinary women who have represented the different parts of Queen’s Park and Maida Vale. My hon. Friend the Member for Brent East (Dawn Butler) is someone who breaks through glass ceilings and lifts others up behind her. Nothing ever dims her spirit and her passion for tackling injustice. You need only walk down Harlesden High Street with her to see how she inspires people by her example—and sometimes her music.
My hon. Friend the Member for Hampstead and Highgate (Tulip Siddiq) is a formidable campaigner who was in the Chamber the day she was due to give birth because she needed to give her constituents a voice. She did not stop campaigning until her constituent Nazanin Zaghari-Ratcliffe was safely home with her family. Those who know her will quickly learn that she never, ever gives up. She is always a voice for the people she cares about.
Karen Buck gave an extraordinary 27 years of service to the residents of Westminster North. I was at a school in my constituency last week where the head said that Karen was the fourth emergency service, always at the end of a phone ready to help. I remember going to an elderly people’s lunch where the residents said, “You can be our MP—you are very nice. Just make sure that Karen comes to our residents’ meeting in July.”
The wonderful team at the House Library sent me Karen’s maiden speech. It was no surprise to me that it was a passionate call to action on the housing conditions of her constituents. That passion has not dimmed for a second; it could be heard in every line of her 37 interventions on the Renters (Reform) Bill over 25 years later. She has shown that somebody with community running through their veins can move mountains. I will work every day to live up to the women who came before me—that includes you, Madam Deputy Speaker, and your sister Baroness McDonagh, who have both showed such amazing, dedicated service and never give up fighting for constituents and the people of this country.
Queen’s Park and Maida Vale is a place that means a huge amount to me. My great-grandfather came over to the UK when he was a teenager, fleeing the poverty and pogroms of Lithuania, and worked his way up to open a shop on Kilburn High Road. My family have lived and worked in the area ever since. Growing up in the heart of London, I attended Horfield primary school and saw how many children were cut out of the opportunities on their doorstep; that has driven me ever since. The need that we see now is greater than ever. My inbox and my surgeries are full of people facing the homelessness crisis and skipping meals to feed their family—all in walking distance of the Chamber.
Queen’s Park and Maida Vale is a place with huge need, but also with huge heart. It has welcomed not just my family but families from so many different backgrounds. We are home to the Bangladesh Caterers Association; the Lauderdale Road synagogue; the UK Albanian Muslim Community and Cultural Centre; Harlesden, which is the unofficial capital of reggae and the starting point for so many iconic artists and producers; Kilburn, a centre of creativity with a claim to be the birthplace of cinema; and the amazing, diverse community of Church Street.
We are a community that is rich in spirit and dynamism. In 1879, Queen’s Park was chosen to host the royal agricultural show, the Victorian equivalent of the Olympics. It was a very British affair—it rained most of the time—but ordinary people campaigned to preserve the open space, and it is still a thriving park today. Down the road, Walterton and Elgin Community Homes is a shining example of community leadership. We also have the country’s only urban parish council.
Queen’s Park is the birthplace of the pride of west London, Queens Park Rangers football club. I can tell the House that being a QPR fan is almost as good as this Chamber for getting to know the communities of the UK; it means spending rainy days in Cardiff, Preston, Southend and Tranmere, embracing again and again the triumph of hope over experience.
I have always been an optimist. Despite 14 tough years in local government, including seven as Camden council leader, I have never lost hope, because every day I can see the power of communities. I was elected as a councillor in 2010, and at events, when people used to say to me, “What do you do?”, I would proudly say to them, “I am a councillor.” They would say, “That is so wonderful; you do such wonderful work as a therapist.” I would have to say, “No, not that kind of counsellor. I am a Labour party councillor.” They would either swiftly go and get a drink or talk to me about dog mess.
Street cleaning and rubbish collection are essential services that councils deliver—my hon. Friend the Member for Birmingham Erdington (Mrs Hamilton) once introduced me as the person who makes sure that Keir Starmer’s bins are collected—but we often forget how much more local government is. I see that every day, watching the work of Brent and Westminster, two brilliant Labour councils in my constituency.
Councils are lifelines for communities. They provide care for the children and adults who most need support. They are leaders of place, bringing services and people together to make change. I have seen local government staff go above and beyond time and again, fuelled by love and dedication, because there was no one else there, whether they were working with communities to deliver food during covid or supporting Afghan evacuees. When things have been hard, they have held together our communities, finding unity in difference.
The Gracious Speech sets out bold new proposals in the English devolution Bill to unlock the energy and creativity of communities. It sets out Bills to fulfil Karen Buck’s long-held campaign to end no-fault evictions and reform the leasehold system. The proposals will support the people of Queen’s Park and Maida Vale who come out every day to build their community—the youth workers, the community gardeners and those running the North Paddington food bank, who wish it did not have to exist. These are people putting hope into action because they believe that things can change. I know that as I sit in the Chamber, I will have their voices and stories with me, but I will also have the stories that I have heard from hon. Members from across the UK. We all have that in common: the privilege and the responsibility of bringing the voices of our community to this place. We may debate and disagree, but I hope to always listen and learn, and remember that we are being entrusted to weave those stories, hopes and ambitions together for a national vision for this country—one that governs for all and leaves no one behind.
Suella Braverman (Fareham and Waterlooville) (Con)
I congratulate the hon. Member for Queen’s Park and Maida Vale (Georgia Gould) on a simply superb speech that follows the best traditions of the House. She has done her constituents proud, and I know that she brings huge expertise and commitment to this House. I wish her all the best.
I put on record my thanks to the good people of Fareham and Waterlooville for sending me back to Parliament. We had a fantastically energetic—let me put it that way—and hard-fought campaign. I am honoured and humbled to have the privilege to speak on their behalf in this Chamber.
One thing struck me in the King’s Speech—not the long list of policies that will no doubt damage our economy, or the vague promises that will not survive contact with reality. For me, the thing that was conspicuous by its absence was the total failure of the Labour Government to deal with child poverty and scrap the two-child benefit cap on welfare. [Interruption.] Yes, hon. Members heard that right. [Interruption.]
Madam Deputy Speaker (Dame Siobhain McDonagh)
Order. Could we show respect and listen to the Member’s speech?
Suella Braverman
I detect a bit of surprise on the Government Benches. I have risen to speak on scrapping the cap. In the grand tapestry of British politics, where the warp and weft of policy and principle interlace, it is not often that a Conservative MP will find threads of agreement with friends across the aisle, but here we are, discussing a proposal backed by Labour MPs, led by the hon. Member for Liverpool Riverside (Kim Johnson) and backed by the Liberal Democrats, the Scottish National party and many Opposition parties. It is one with which I agree, because it speaks to my profound sense of justice and, dare I say, compassion. I will say why Conservatives can and should back scrapping the cap.
Let us not rewrite history, because there has been a lot of nonsense from Labour Front Benchers about the situation that we inherited in 2010. To put it simply, we inherited no less than an economic catastrophe, and we worked hard to recover from that situation. The deficit stood at 10% in 2010; we got that down to 1.9%. Public sector net borrowing was at 10%; we got that down to 3%. We were in a deep recession, and we now have the fastest growing economy in the G7.
We had to make incredibly difficult decisions back in 2010 to reduce our welfare bill, but it is clear to me that through those welfare reforms, spearheaded by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith), we overhauled an overly complex, bureaucratic system, and helped millions of people get back into work. Four million more people are in work now than in 2010. The unemployment rate is down to 4.4%—almost half what it was in 2010. We can make changes to some of the decisions that we made back then.
It is clear to me from my work with vulnerable families in Fareham that the cap is not working. It is pushing more children and families into relative poverty, causing them to use more food banks. There are three good reasons for scrapping the cap.
Ian Lavery (Blyth and Ashington) (Lab)
Will the right hon. and learned Lady tell the House who introduced the cap, why, and which way she voted when the measure went through this House?
Suella Braverman
I just set out that the parlous economic situation forced us to make impossible choices, but thanks to the improved economics and the improvements brought about by universal credit, I believe that it is time to put child poverty first and scrap the cap. There are three big reasons for Conservatives to support that. First, it is affordable. For about £1.7 billion—0.14% of total Government spending—we could quickly bring around 300,000 children out of poverty. In this improved situation, that is the fair and right thing to do. Secondly, the reason why it was introduced in the first place was to disincentivise poorer families from having more children, but that has not necessarily worked. The number of children born has remained relatively stable. As the Joseph Rowntree Foundation found, heartbreakingly, 43% of children in larger families are in poverty. The children hardest hit are those under four. It predominantly affects younger children, and those in large families. I believe that the cap is aggravating child poverty, and it is time for it to go.
I know that there is the argument, “Don’t have children if you can’t afford them.” To me, that is not compassionate, fair or the right thing to say. As Conservatives, we should be proudly and loudly the party of family. We should encourage families on lower incomes to have more children. For those families on middle and higher incomes, we should change our tax regime so that they are incentivised to have children. We have better parental leave policies, better childcare provision policies and better maternity care. I am a Conservative because I believe in the strength and the sovereignty of the family unit. We should support it, not suppress it. This is not about right or left. This is about right or wrong. Let us come together, in a spirit of compassion and common sense, to scrap the cap and end child poverty for good.
Sarah Sackman (Finchley and Golders Green) (Lab)
Thank you, Madam Deputy Speaker. It is a pleasure to follow the right hon. and learned Member for Fareham and Waterlooville (Suella Braverman). Like other Members, I am somewhat surprised by her rewriting of recent economic history. She had 14 years to fix the problems of child poverty, and did precious little to do that. I listened today to the Chancellor of the Exchequer lay out this Government’s plans to restore economic stability and growth to this country—that is what will lift millions of children out of poverty in the long term.
It is a privilege to stand here today representing the place where I was born and raised, Finchley and Golders Green. I would like to start by paying tribute to my predecessor, Mike Freer. Although we disagreed on many things, Mike was dedicated to our area, both as a Member of Parliament and as leader of Barnet council. I admire his commitment to public service and, in particular, his role in securing equal marriage legislation for same sex couples—a legacy that he can take enormous pride in. But the circumstances under which Mike decided not to stand for re-election are appalling. We should have been able to face each other on the basis of our ideas, but Mike’s life and office were threatened by those who believe in the bullet, not the ballot box. It is a stark reminder of the fragility of our democracy both at home and abroad.
I want to use my time in this place to stand up for the democratic values and processes that I believe in. Witnessing the dignified and smooth transition of power last week in all parts of this House is something we can take pride in. We must ensure that we work together to defend the safety of public servants. I wish Mike and his husband Angelo all the best in their future.
I also pay tribute to the much missed Dr Rudi Vis, who holds a special place in the heart of my local community, not least as the first Labour Member to represent this special patch of north London. In over a century, I am only the second person from my party to be sent to this place by the people of Finchley and Golders Green. I am also only the second woman. Some Members may remember the first. When Mrs Thatcher entered this place, she was made to wait two whole years to make her maiden speech, but in our era of breakneck news cycles, and with so much work that I want to do, having to wait just two weeks has felt like a very long time. Having delayed long enough, Mrs Thatcher did not waste a second when she rose to her feet, breaking convention by making her maiden speech on a private Member’s Bill that she introduced.
“This is a maiden speech”,
she said, her sonorous tones echoing through this hallowed place—
“but I know that the constituency of Finchley…would not wish me to do other than come straight to the point”.—[Official Report, 5 February 1960; Vol. 616, c. 1350.]
The people of Finchley and Golders Green rightly remain as demanding of their elected officials today, so I, too, will come straight to the point. Like Mrs Thatcher, I am a patriot and I want our communities and our country to prosper and be an influence on the global stage. But unlike her, I fundamentally believe that there is such a thing as society. Society is not an abstract idea to be buried in sociological essays. We can see it in the rich tapestry of communities that come together across Finchley and Golders Green. I may be the first female, Jewish, Gibraltarian MP from this constituency, but I would not be here without the support of my neighbours and my community: the Cypriot community, the Somali Bravanese, the Kosovan, the Japanese, the Irish and Hindu communities, the lawyers and the Uber drivers, the charity workers and the campaigners, the Spurs fans and the fans of some other north London team. Whereas in recent times some politicians have chosen to use “north Londoner” as an insult, my constituents and I wear it as a badge of pride. It symbolises a place that celebrates diversity, hard work and looking out for your neighbour.
Our diversity comes as no surprise to anyone familiar with the history of our area. Where else can boast the parish where Archbishop Desmond Tutu honed his ministry in the terrible years of exile during apartheid in South Africa, and the childhood home of the late and great Rabbi Jonathan Sacks, a man who taught us that a good society is one that offers all its members equal access to hope? It was in East Finchley that George Michael first tinkled on the ivories and Amy Winehouse first took the stage.
Finchley and Golders Green has a quiet radicalism baked into its history. Take Hampstead Garden Suburb, where I grew up, a project driven by the extraordinary Henrietta Barnett in the early 20th century. One of the first garden cities, it was a groundbreaking development. She also set up Toynbee Hall in London’s east end, where I began my legal career as a volunteer at the Free Legal Advice Centre. I saw there just how important the law could be for tenants facing eviction and women suffering unequal pay. Now I want to take those values of access to justice and a commitment to the rule of law into my new role as Solicitor General.
When, in 1907, we witnessed the opening of Golders Green underground station, adverts at the time dubbed our area a “place of delightful prospects”. I can vouch that never a truer word has been spoken, but this place of delightful prospects has suffered in recent years. My community has witnessed rising levels of antisemitism and Islamophobia. These are a scourge on our society and as long as I am in office I will tirelessly call them out and work to eradicate them.
Our community today is increasingly becoming a place of busy food banks and empty mansions. Inequality is writ large, stunting people’s health and potential. Many across Finchley and Golders Green are struggling with the spiralling cost of living. This has to change not just in my constituency, but across the whole country. Our NHS is broken, the prisons are full, the police cannot respond when they are called out and our teachers are not supported to deliver. We need to get Britain back on track, and the Bills set out in the King’s Speech are exactly what we need to take the brakes off the economy and restore and rebuild our public services.
My constituents are raring to go. Whether it is the Brent Cross Town development, one of the largest regeneration developments in Europe, or our brilliant high street businesses and local entrepreneurs, all we need to get growing is a Government who are on our side. Well, we have that Government now. So, to quote my famous predecessor, let’s get straight to the point and let’s get on with the change that Britain truly needs.
Wera Hobhouse (Bath) (LD)
The shift to a green economy represents the most significant transformation for centuries. We must reverse the damaging rhetoric by the failed Conservative Government that the economy will suffer if we are uncompromising in our ambition to get to net zero. This is not an either/or of economic growth or investing in the green economy—the green economy is at the heart of economic growth.
We must end our reliance on oil and gas. Renewables would mean cheaper energy bills across the country, and we would no longer be reliant on dictators such as Vladimir Putin who use natural gas as a weapon. As well as being more affordable, renewables are the best route to energy security. Under the Tory party, renewable projects faced long delays and costs skyrocketed. The new Government’s reversal of the de facto ban on new onshore wind is welcome. We are also glad restrictions on new solar have been reversed.
The Liberal Democrats share the ambitions of the Government’s climate agenda, but we will also ensure that these projects have local buy-in. Local authorities must play a leading role in delivering climate action, and the communities that host the new infrastructure must directly benefit from it. For example, there is huge growth potential in community energy. The Liberal Democrats are calling for small-scale renewable energy generators to receive a guaranteed fair price for the electricity they sell back to the grid. Community benefit and individual economic incentives are crucial to securing support and active participation in our energy transition.
In both the Labour and the Liberal Democrat manifestos there was a clear commitment to tightening energy efficiency standards for private landlords. National Energy Action has warned that the statutory fuel poverty target cannot be met without doing so. The King’s Speech provided an opportunity for the new Government to set that as a priority in their new renters’ rights Bill, but it was missed out. I hope the Government will hear this and ensure that improvements to energy efficiency for renters materialise before the situation worsens.
Under the previous Conservative Government, the cost of living crisis was exacerbated by rises in travel costs, particularly for commuters. It is not clear how Labour’s plans for nationalisation will do anything to alleviate the high cost of travelling by rail. We urge the new Government to freeze rail fares and simplify ticketing to ensure that regular users are paying a fair and affordable price. For too long, decisions over local transport have been centralised. Liberal Democrats have long argued for lifting the ban on local authorities franchising buses. It is reassuring to see that the Government recognise the importance of local decision making. However, councils will need adequate resourcing to expand services. We are yet to see a strategy for that. We would also like to see a long-term plan from the Government for further electrification of the rail network. Not providing one would be a dereliction of duty to reduce emissions and improve air quality.
I look forward to working together constructively with the new Government to turbocharge our energy to get to net zero, and to make sure we really improve our green public transport and grow the huge opportunities of a green economy.
Madam Deputy Speaker (Dame Siobhain McDonagh)
I call Andrew Lewin to make his maiden speech.
Andrew Lewin (Welwyn Hatfield) (Lab)
Thank you, Madam Deputy Speaker, for allowing me to make my maiden speech in this debate. It is a privilege to follow the first female Chancellor in history, and to follow two inspiring maiden speeches from the Labour Benches by my hon. Friends the Members for Queen’s Park and Maida Vale (Georgia Gould) and for Finchley and Golders Green (Sarah Sackman). It is an honour to sit alongside them on the Government Benches, and their communities are both very lucky to have them.
As hon. Members can imagine, I have given careful thought to my remarks today, but it is safe to say that this is not the most anticipated maiden speech ever associated with Welwyn Hatfield. The reason for that is that, on 20 November 1558, Elizabeth I gave her inaugural address as Queen from Hatfield House in my constituency. Irrespective of how the next few minutes go, I think her place in history is safe.
I am especially grateful to be called in this debate on the economy. My constituency is anchored by two new towns that flourished under a previous Labour Government. Hatfield and Welwyn Garden City were incorporated as new towns together under a single development corporation on 20 May 1948. The growth of Hatfield and Welwyn Garden City played an important role in the rebuilding and reimagining of life in our part of the country after the horrors of the second world war. I believe that if we are to succeed in growing our economy, we have to rediscover the ambition and the vision that was embodied by those who designed and carefully planned our two great towns.
My predecessor as the MP for Welwyn Hatfield was the right hon. Grant Shapps, who served our community for 19 years and will be well known to all Members of this House. In fact, he will probably be familiar to anyone who was watching a morning television news programme at any point over the last five years. Before I talk about Grant’s legacy, however, I want to start with a message of reassurance to the Labour Whips and my colleagues: I have no desire to hold quite so many Cabinet positions as he did, and certainly not in such a short period of time.
I want to reflect solemnly on the personal and professional commitment that Grant Shapps made to the people of Ukraine. After the Russian invasion in 2022, he opened his family home to provide sanctuary to three generations of a Ukrainian family, innocent people whose lives were turned upside down by Putin’s unprovoked act of aggression. In the last Parliament, more than 200,000 Ukrainians were welcomed to our country under the Ukraine family scheme and the Ukraine sponsorship scheme, an initiative that I believe showed our country at its best, open and welcoming in an hour of grave need.
We serve in this House of Commons at a time when our wider political discourse can often be angry and divisive. Of course we will disagree in the House, and passionately so—our constituents rightly expect us always to stand up for our community and our values, and I will certainly try to do just that—but I think we can too easily forget what unites us. Where we agree, let us have the confidence to say so. My predecessor was right to champion the people of Ukraine, and the cause of freedom and democracy. I commend him for it, and wish him well in whatever comes next.
Welwyn Hatfield is a constituency rich in history. Welwyn Village and Woolmer Green were both Roman settlements, and Welwyn is one of the few places in the country believed to have been occupied continuously for 2,000 years. Nearly 400 years after Hatfield was home to Queen Elizabeth I, local people made an important contribution to the defeat of Nazi tyranny. The Royal Air Force’s Mosquito fighter-bomber was developed at the de Havilland airfield and aircraft factory in Hatfield. Welwyn Garden City also has a unique place in history as the creation of Ebenezer Howard, the father of the garden city movement. His immaculately planned and tree-lined streets, such as Parkway in Welwyn Garden City, are still true to his vision from nearly 100 years ago.
Despite our wonderful history, what has struck me when I have walked around our towns and villages is the impression of too many projects on hold, and potential going unfulfilled. Take the iconic Shredded Wheat silos, designed by Louis de Soissons in 1926 and a defining feature of Welwyn Garden City for decades. The site has lain virtually dormant since the factory closed in 2008. In central Hatfield, it is a similar story. Queensway House consists of 66 units that were once all social housing. In November 2019, after a ballot of residents, a majority decided that it was time to demolish and rebuild, but nearly five years later Queensway House is still standing, and it looms over the centre of Hatfield as a symbol of the inertia that has captured our politics for too long. I am determined that that must change. The centre of Hatfield is one part of our community that most urgently needs investment in good-quality housing and social infrastructure, and I will be a champion for it in this House.
Welwyn Hatfield is a growing and increasingly diverse community. In just the last few months I have attended the world street food festival in Welwyn Garden City, the first ever Diwali celebration in White Lion Square in Hatfield, and the ever popular Welwyn festival on Singlers Marsh. We are home to prominent national businesses, including Tesco and Ocado in Hatfield, and to the thriving University of Hertfordshire. The university will soon be opening its state-of-the-art Spectra building for the study of physics, engineering and computer science—and yes, Mr Vice-Chancellor, as this will appear in Hansard, please consider that to be my formal bid for an invitation to its opening!
I believe that a new Parliament is a time for ambition and optimism. Welwyn Hatfield blossomed when Attlee’s Labour Government put housing and carefully planned communities at the centre of its agenda for change. Nearly 80 years later, we have another majority Labour Government with a mandate for national renewal. This is a moment of opportunity, and each of us on these Benches has a responsibility to play our part in realising it. For as long as I serve in this House of Commons, I will always do my utmost to champion Welwyn Hatfield, to respect our history, and to be an agent for change.
Several hon. Members rose—
Madam Deputy Speaker (Dame Siobhain McDonagh)
Order. Let me just give the House a reminder—not that the next Member I will call needs this reminder—that for those of us who could be described as veteran Members, it is the custom to praise maiden speeches.
Andrew Rosindell (Romford) (Con)
Thank you, Madam Deputy Speaker. May I say what a pleasure it is to follow the hon. Member for Welwyn Hatfield (Andrew Lewin)? He spoke with great eloquence, and also with passion about his constituency. I know what a wonderful moment it is when we give a maiden speech. We all have that honour when we enter the House. I welcome the hon. Gentleman to his place, and look forward to working with him in the years to come. Of course, Hertfordshire is next to the county where my own constituency is located—Essex and Hertfordshire are twin counties, so we are neighbours in some senses—and I also look forward greatly to hearing more from him in the months and years ahead.
I think that one of our colleagues who spoke earlier forgot to welcome the hon. Member for Finchley and Golders Green (Sarah Sackman). I know that constituency well. I campaigned for Mrs Thatcher in 1983 as a young Conservative, at the age of 17; I know Ballards Lane very well, and I have often been to Margaret Thatcher House. I must commend the hon. Lady on her kindness and the generous words that she spoke about not only Margaret Thatcher but my friend Mike Freer, whom we were sad to lose in the election. I know that she will be a fine champion of Finchley and Golders Green, which is a proud constituency with a great identity, and I look forward to visiting Finchley again while the hon. Lady is in place as the Member of Parliament.
Wera Hobhouse
I do apologise to the hon. Member for Finchley and Golders Green, and to the whole House, for not recognising my duty to thank the hon. Lady for her wonderful speech. This means that even after seven years in the House one sometimes forgets to do certain things. It is very good to see the hon. Lady in the House, and I particularly enjoyed what she said about the rule of law.
Andrew Rosindell
I am deeply proud to have been elected for the seventh time as the Member of Parliament for Romford. I am now the longest-serving MP for Romford since 1885, when the constituency was created. I am here because I believe in things. I am here not because I seek titles and positions, but because I believe in this country, and I am also passionate about my constituency, because it is where I am from. I think that those of us who come from our constituencies know how important it is to represent a place where we have lived all our lives, and I will always be proud of being the MP for my home town.
As I have said, I believe in things, and I believe first in this country. Let me say to Ministers, whom I congratulate on their election to power, that things change and Governments come and go, but the one thing that we must never give away is the freedom and liberties of the British people. I say to them, “Whatever you do, please do not reverse the biggest democratic decision that the British people made.” We want to have sovereignty; we want to have the right of self-governance; but we also want prosperity, and that means free enterprise, low taxes and smaller government. It does not mean creating a larger centralisation of power. Margaret Thatcher taught us that if we have lower taxes and free enterprise, if we give people the freedom to prosper and make their own decisions in life, in the end we create more prosperity and more opportunities for all. That, I am sure, is what all of us, in all parts of the House, want to see, so let us learn from past mistakes.
I respect the fact that we have different opinions on many issues, and I also understand that all of us here want the best for our country and our constituencies. However, I believe that if we want economic prosperity, we need Governments to stay out of people’s lives. We need to allow business to flourish. We need less regulation, and we need to cut unnecessary public expenditure, so that people are not paying high taxes which disincentivise work and put people off from investing in our country. I hope that the Government, having taken office, will pay heed to that. I also say to them that, yes, we want to protect our environment, but we have to think very carefully about the evangelism of net zero. We do not want to make our country cold and poor, and to give competitive advantage to other countries that do very little about climate change and have not met their targets. I am afraid the policy that the Government have adopted will deliver more power to China, so I warn them about going too far in that direction.
I believe that we should be a Parliament that makes decisions, so I disagree with more and more quangos, committees of experts and bodies that are not democratically accountable having so much say. Why are we effectively giving the Office for Budget Responsibility a veto over the rights of this Parliament to decide economic policy? Surely that is something that the Government should think again about.
Before I have to end, I would like to say that if we are serious about devolution, we should give all parts of the country greater control over their local communities. Boroughs such as Havering would rather be independent. We do not want to be under Greater London; we want power devolved back to our local communities. Historically, we are part of Essex, and we do not like being controlled by City Hall—and certainly not by the current Mayor of London. I represent the people of Romford, and they would agree with what I have said. Let us have free enterprise, true devolution and, above all, prosperity for the British people, but let us also stand up for our country abroad and at home.
Miatta Fahnbulleh (Peckham) (Lab/Co-op)
Thank you, Madam Deputy Speaker. May I start by commending my hon. Friends for their impassioned maiden speeches? I am so proud to be sitting on these Benches with them.
I am incredibly honoured to be speaking for the first time in this House as the Member of Parliament for Peckham, a new constituency that spans from the oak trees of Nunhead cemetery to the spires of St Giles’ church, the African food shops of Peckham, the bustle of Rye Lane, the market stalls of Faraday’s East Street, the vibrant mosques of Old Kent Road and the Latin quarter of North Walworth. Ours is a community of communities that represents the very best of multicultural Britain—people of different colours, cultures, faiths and backgrounds united in our openness and acceptance of each other. We take pride in our diversity and the magic it brings to Peckham, and in our warmth and generosity of spirit.
Whoever you are and wherever you have come from, you will find your place in Peckham. For me, this is what makes representing the constituency so special, because it was among friends and the Sierra Leonean community in Peckham that my family found refuge when we fled from west Africa when I was a child. It was in this community that I learned the values of compassion and solidarity that have shaped my politics, and it was in this community that I first understood just how much the economy is failing people. I learned that you can work hard every day and still live in poverty, that our kids can be talented but still be deprived a shot, and that you can have billionaires living in the same borough as families that cannot feed their kids. It is in Peckham that I found my resolve that this must change. That is why I became an economist, why I have spent the last 15 years developing and campaigning for ideas to bring this change about, and why I am standing here today.
As I begin my journey in this House, I take inspiration from my formidable predecessor Harriet Harman, our inaugural Mother of the House. Harriet set the highest bar possible for what it means to be a great MP, having given 42 incredible years of service in working for the people of Camberwell and Peckham. In knocking on doors across Peckham, I heard story after story about how Harriet helped her constituents and touched countless lives. At a time when trust in our politicians is so frayed, the warmth, love and trust that she commands in our community speaks volumes. But more than that, she combined tireless work in her constituency with making a huge impact on our politics nationally—whether through enduring policies like the minimum wage, the winter fuel payment and the Equality Act 2010, which went to the heart of the inequality she saw in our community, or through the trail she blazed for women in politics by breaking ceilings and carving a path for others to follow. Today, the 190 Labour women MPs in this House are standing on her shoulders. On a personal note, I will always be grateful for her kindness, wisdom and grace, and for showing me what it means to be fearless in defence of your constituents, loyal but independent of mind, and tenacious about the change that is needed.
The need for change has never been so great. Today, as we debate the economy and all the uncertainties it brings, there is one thing I know for certain: people in Peckham are struggling. Their pay packets have flatlined for too long, with their safety net cut to shreds. Over a third of them cannot afford day-to-day essentials, and too many of our children now live in poverty. But it is not just about the money in your pocket; it is the fact that something as basic as a decent and affordable roof over your head is now out of reach for so many. Our schools, youth services, hospitals and care system are at breaking point, and children in my schools tell me that they only feel safe at home or at school—nowhere in between.
People in Peckham need change—not words or the promise of change that never comes, but real, tangible change that they can feel in their communities and see in their lives. They need change that will end the sense of being ground down, end the constant survival mode that so many people find themselves in, and rekindle the hope that has been beaten out. The weight of responsibility to deliver this now sits with me and all my hon. Friends on this side of the House. While the task feels insurmountable, what gives me hope is that those on our side have always grasped for big ideas to change the country when we have needed to do so. The NHS, social housing from the rubble of war, and the minimum wage—we have always been the party of big ideas. We have done it before at moments of crisis, and now we must do it again. As we find solutions to the challenges in front of us, I, as a proud Labour and Co-operative MP, hope that we will draw inspiration from the deep traditions of our movement—the enduring force of co-operation, putting power back in local hands, creating businesses run by local people for local people, trusting communities like Peckham to decide their own future, and giving them ownership and a stake in their economy—so that we can deliver the change for which my constituents and constituents across the country have given us a mandate.
If you will allow me, Madam Deputy Speaker, my final words are to my constituents. To the people lying awake at night and worrying about bills, the traders fighting for the survival of the businesses they have built, the families that cannot afford a home to lay down their roots, the people who cannot get the care they need and the kids who do not feel safe in our community, I want you to know this. I have listened to every conversation we have had. I have heard your worries, your anger, your frustration and your hopes, and I make one promise to you: in everything I do in this House, I will keep you in my mind’s eye. I will be your loudest voice, your fiercest defender and your proudest champion. I will fight every day to deliver the change that you deserve. I will serve you.
Bradley Thomas (Bromsgrove) (Con)
Thank you, Madam Deputy Speaker, for allowing me to make my maiden speech here in the mother of Parliaments, a global beacon of representative democracy. I congratulate the hon. Member for Peckham (Miatta Fahnbulleh) on her election and on making her inaugural contribution in this House.
I am humbled to serve the people of Bromsgrove and the villages in my home county. I have some esteemed and worthy predecessors, most recently Sir Sajid Javid. He was the first ethnic minority Member of Parliament to become a Secretary of State, and went on to hold not one but two of the great offices of state, serving as Home Secretary and Chancellor of the Exchequer. Sir Sajid is a man whose north star is his integrity, and he has devoted much of his time to supporting and championing good and noble causes, including, as many in this House know, suicide prevention.
Bromsgrove constituency is, for the unfamiliar, in Worcestershire. Bromsgrove town, its namesake, is proud of its history and traditions, which include a historic court leet centred around the parade on fair day, held on the closest Saturday to midsummer and in celebration of the 1199 charter granted to the town by King John. This heritage goes further, and Bromsgrove’s proud sons and daughters include the poet and scholar A. E. Housman and his sister Clemence, who I could not fail to mention here in this House, given the role that she played in the suffrage movement.
My constituency, however, is much broader than just one town. There are many more villages and hamlets and, being 79% rural, Bromsgrove epitomises the very best of Worcestershire. There are rolling hills and thriving villages where the community spirit is strong, including Clent, Dodford, Stoke Prior, Belbroughton, Romsley, Finstall, Barnt Green, Cofton Hackett, Tardebigge and Alvechurch. There are other communities on the fringe of the constituency whose identities are rooted proudly in Worcestershire, including Hagley, Rubery, Wythall, Major’s Green—and there is even a touch of glamour in Hollywood. I commit myself to representing them all. Our villages are home to rural enterprises, and to farmers who we all rely on three times a day and who are guardians of our countryside, often working in isolated or harsh conditions, both physically and in a competitive marketplace.
It would be easy to be lulled into thinking that Bromsgrove is somewhere quiet and without ambition, but hon. Members must not be fooled. The Sunday Times recently highlighted how South Bromsgrove high school is a powerhouse of aspiration and entrepreneurship, producing young high achievers who have gone on to found leading companies in their sectors, including Gymshark and AYBL. It is in no small part down to the attractiveness of rural Worcestershire that Bromsgrove is a fertile place for aspiration and ambition to bloom. As a Conservative, I believe in respecting the tradition and heritage that anchor our institutions and values, as society evolves to meet the needs of the present day and into the future.
Prior to my election to Parliament, I spent many years as a councillor in Worcestershire, including as leader of Wychavon district council, where I championed the importance of design codes and the role of beautiful design in delivering quality communities that inspire a sense of pride, nod to our past and catalyse the economic and social investment that allow our towns and villages to flourish. We must do this by shifting our collective focus away from beautiful design being seen as a cost, and towards seeing it as an investment that pays dividends in the form of thriving communities and vibrant places where aspiration can bloom. This is critical across Bromsgrove, a place that is 89% green belt and is the rural buffer between Worcestershire and the urban sprawl of Birmingham, to ensure that we protect our green open spaces and do not build identikit monotony all over the countryside, instead focusing on delivering quality homes, with appropriate landscaping and a mix of textures and colours, with genuine local support first.
Over the coming years, we must never forget that the single biggest driver of our economic success is a thriving free market—an environment where businesses are incentivised to invest, creating the prosperity that will underpin our national success. The Government must exercise restraint as they seek to create new bureaucracies, which increase the size of the state under the veil of public service reform, and they should be cautious as additional spending, funded through taxation or borrowing without serious structural reform of public service delivery, will fail every stakeholder who interacts with public services.
In my constituency, Bromsgrove school, founded in 1553, employs over 600 local people and contributes £43 million to the GDP of the UK. While every Member of this House would surely agree that education is the foundation of prosperity, the Government’s proposal to impose VAT on these schools is not only an ill-conceived affront to the children and families who currently exercise choice in education provision but an attack on the wider education system that will undoubtedly do little to enhance the quality of state education and will instead level down education standards across the board. I say that as someone who was proudly educated in excellent state schools.
We must also show determination in delivering vocational skills in agriculture, manufacturing, technology, engineering and trades, which will bolster our prosperity, raising our baseline level of industrial resilience in a world where our adversaries want to blunt our competitive edge. Food and energy security are two of the most significant and interlinked contemporary challenges that we face. The Government must remain pragmatic in their efforts to deliver on both, ensuring that in everything they do, they do not worship at the altar of ideological purity and inadvertently sacrifice our own long-term economic success in the process. In the words of A. E. Housman,
“The house of delusions is cheap to build, but draughty to live in, and ready at any instant to fall.”
I look forward to playing an active role in this House, delivering on behalf of my constituents and in the long-term national interest of our country.
Kim Johnson (Liverpool Riverside) (Lab)
I start by congratulating all those who are making their maiden speeches today, and welcoming them to this place. I also thank my Liverpool Riverside constituents who re-elected me. I give my commitment to continue to be their voice in this place. My constituency is now the most deprived in the country, with 47% of children living in poverty. That is nearly one in every two children, and it is communities such as mine that have faced the sharpest edge of 14 years of austerity and the cost of living crisis. Nationally, 16 million people are now living in poverty; 4 million are children, and 1 million are living in destitution. I am sure everybody in this House would agree that those figures are unacceptable.
Child poverty is completely avoidable in the sixth richest country in the world. Not tackling it stores up problems for the future, costing our economy £39 billion per year, according to calculations by the Child Poverty Action Group. It is not a question of whether we can afford to adopt vital policies to alleviate child poverty, such as lifting the two-child cap; it is a question of whether we can afford not to. This is the reason I tabled amendment (f) to the King’s Speech, with a focus on debate not division, to push for a clear timetable for scrapping the two-child cap. The End Child Poverty coalition believes this to be the most effective way to immediately lift 300,000 children out of poverty.
There is support for this position from right across the political spectrum, and it is something that the Labour leadership has indicated that it will do as soon as financially viable, but there are pockets of money that can be found if we look hard enough. Gordon Brown has suggested that between £1.3 billion and £3.3 billion can be found by imposing a reserve requirement on banks similar to those that the European Central Bank and the Swiss banks currently have, and that £700 million can be found by simplifying the gift aid system.
Economists believe the recent upturn in the economy means that the new Government could begin to consider bringing forward priority policies such as scrapping this cap. Others would argue that progressive taxation should also be strongly considered. The latest Department for Work and Pensions data shows that two thirds of families impacted by the two-child cap have at least one parent in full-time work. The last Labour Government had a big and bold ambition in 1997 to end child poverty within a generation. As a single working mum of twins, I personally benefited from those transformative policies. Without the availability of after-school and holiday provision, I would not have been able to continue working.
I know we have inherited the worst financial situation since the second world war, and that Labour in government is going to have some very careful choices to make about the path forward. We have a massive mountain to climb, but we were elected with a massive majority. The country has voted for change. Removing the two-child cap would send a powerful message of hope to those who have put their trust in a Labour Government to bring about the change we so desperately need. The one in two children living in poverty in my constituency have known nothing but the tyranny of a Tory Government, hunger and hardship during their short lives. Those children cannot and must not wait any longer to be lifted out of poverty.
As I mentioned earlier, the purpose of my amendment was to debate this very important issue, not to cause divisions, and there has been lots of debate this week but we need action. This punitive policy needs to be consigned to the dustbin of history, where it belongs, and in its place we need policies to lift 4 million children out of poverty. Let us put these children and our country first. I call on the Chancellor to make some immediate changes here.
Mr Deputy Speaker (Sir Christopher Chope)
I call Peter Bedford to make his maiden speech.
Mr Peter Bedford (Mid Leicestershire) (Con)
It is a pleasure to follow my hon. Friend the Member for Bromsgrove (Bradley Thomas) and Members on both sides of the House who have given their maiden speeches with such passion today.
I thank my long-standing friends, family and supporters who have worked so hard to enable my election to this place. Although there are far too many to name, I want to put on record my sincere thanks to Richard Milburn, Paul Taylor, Jon Humberstone, Ravinder Taylor and Ross Hills for their herculean efforts over recent months.
It is customary for new Members to pay tribute to their predecessors. However, I am in the unusual position of my three immediate predecessors being sitting Members of this House. I thank my right hon. Friend the Member for Melton and Syston (Edward Argar), and my hon. Friends the Members for South Leicestershire (Alberto Costa), and for Hinckley and Bosworth (Dr Evans), for their assiduous work in the last Parliament for the residents of my constituency. I look forward to working with them collectively for all the residents of Leicestershire.
The new Mid Leicestershire constituency is formed from parts of Charnwood borough, Hinckley and Bosworth borough and Blaby district. The Charnwood villages comprise Anstey, Birstall, Cropston, Thurcaston, Swithland, Rothley, Mountsorrel, Woodhouse Eaves and Old Woodhouse, and the borough is home to the UK’s only mainline heritage railway, the great central railway.
At the heart of the constituency is Bradgate Park in Newtown Linford, a place I call the jewel in the crown of rural Leicestershire. No matter your troubles, you will be able to take a peaceful, tranquil walk, admiring the deer and their fawns, while taking in breathtaking views of the beautiful green surrounds, before looking up at Old John and quietly reflecting on one’s physical fitness; it is a 212-metre climb to the top of that hill.
It would be remiss of me not to mention the ruins of Bradgate House, which is believed to be the birthplace of Lady Jane Grey, who ruled as Queen for a mere nine days; hon. Members can be assured that my maiden speech will not last that long.
The Blaby district areas of Braunstone, Thorpe Astley, Leicester Forest East, Kirby Muxloe and Glenfield also form part of the new constituency. Although they extend from the city, they very much value their unique identities as independent county settlements. Indeed, I put on record my support for the campaign spearheaded by Glenfield resident Steve Walters and local residents to protect Glenfield from the ever-increasing urban sprawl.
The Hinckley and Bosworth villages include Ratby, Groby and Field Head, in addition to Markfield, Stanton under Bardon, Bagworth and Thornton, which for the last seven years I have had the immense honour of serving as a Leicestershire county councillor.
Many of my constituents have legitimate concerns about overdevelopment and the lack of infrastructure to cope with the strains that population growth brings. I think of villages such as Ratby, which has seen its population almost double over the last 10 years, and where, even today, developers are willing to take advantage of the borough council’s lack of a local plan. I urge the incoming Government to ensure that local communities, not faceless bureaucrats in Whitehall, always have the final say on development across our green and beautiful countryside.
I turn to the issues that I will champion during my time in this House. The first is social mobility. As the eldest of three children in a single-parent family, I passionately believe that it does not matter who you are or where you were born; it is what you do with your life that matters. Life chances, owning your own home, getting a career and having a family should not be the exclusive preserve of the wealthy, but should be opportunities available to all.
I believe that the best path out of poverty is through education and training, and I will work constructively with Members from across the House to ensure that reform and investment in these vital tools is the Government’s top priority. The motto of my secondary school is “Aspire, Achieve, Acclaim”, a sentiment that I want to see promoted far more widely across society.
Secondly, I came through the ranks as a local councillor, so I cannot give my maiden speech without referring to fairer funding for local authorities; that is another issue that I wish to spearhead. The system is fundamentally broken, with allocations still linked to historical spending levels. The result is a poorly funded system in which need and funding do not match. For example, the core spending power of Leicestershire county council is a mere £900 a head, compared with almost £1,500 a head in the inner London boroughs. Reform in this area, by Governments of all colours, is long overdue, and I shall be a vocal advocate for fairer funding in this place and beyond.
Finally, dignity towards the end of life will continue to climb up the political agenda, particularly given our ever-ageing population. My election to this House is tinged with sadness that my grandparents are not around to see me give my maiden speech. Both were diagnosed with incurable cancer and, like millions across the country, they wanted greater control of their lives in their final days.
I am here to represent all my constituents, and I pledge to be a vocal advocate for those who are often disillusioned with the political process, or feel that their voice is not heard by those with power. It is the highest of honours to be elected to this place, and I intend to do my very best each and every day to repay that trust.
Mr Deputy Speaker (Sir Christopher Chope)
I call Jonathan Brash to make his maiden speech.
Mr Jonathan Brash (Hartlepool) (Lab)
I congratulate all Members who have made their maiden speeches today, including the hon. Member for Mid Leicestershire (Mr Bedford), who paid a moving tribute at the end of his speech.
I thank staff across the parliamentary estate for diligently and patiently looking after new Members in these first few days.
It is an honour to be called to make my maiden speech, which I do proudly as the Member of Parliament for my hometown of Hartlepool. To represent the place where I grew up, where I met my wife Pamela and where we are raising our young family holds a special kind of responsibility for me. The challenges that Hartlepool people face are personal, because they are challenges that I share. When one of our local businesses closes due to spiralling costs, there is a good chance that I have visited it in better times. When a local play area is the victim of arson, my children are among those devastated at the loss of a place they enjoyed, and when someone tells me that they are living in pain because they cannot see an NHS dentist in a town that has been described as a dental desert, I know how they feel, because I cannot get one either.
It is these experiences that drove me to serve my home-town, and it is Hartlepool people who have given me that opportunity. It is now my duty to respond in kind by delivering for them the opportunities that they have been denied for far too long. That is why I welcome this King’s Speech, which prioritises growth in every part of the country, not just those already blessed with affluence.
Hartlepool’s history is one of innovation and industry. Once the bedrock of the British economy as the country’s third-largest port, we built ships that shipped the Durham coal that powered the world. At one point in our history, Hartlepool’s shipyards, such as William Gray and Company, launched more ships than anywhere else in the world. As a major exporter of steel, we built the bridges, the ships, the railways and the infrastructure that transformed not just our economy but economies across the globe. Such was Hartlepool’s strategic importance that, along with only two other places on the north-east coast, it was targeted for bombardment by the German navy during the first world war. In true Hartlepool style, we were the only place to fire back, making the Heugh gun battery the UK’s only first world war battlefield.
Our industrial heritage has not left us. The Expanded Metal Company, which I have had the pleasure of visiting, provided metal mesh for buildings such as the Stephen Lawrence centre in Lewisham, the Young Vic theatre and New York’s New Museum, among many others. Our world famous, and award-winning, Camerons brewery was built during Hartlepool’s industrial heyday, but it has survived, grown and adapted to a changing economy, and a pint of Strongarm is as good today as it was back then.
In moving the Humble Address, my hon. Friend the Member for Bootle (Peter Dowd) mentioned the famous Antony Gormley statues in his constituency. Although there are no Antony Gormley statues in Hartlepool, we are proud to have built the most famous one. Whenever I travel up the A1 through the constituency of my hon. Friend the Member for Washington and Gateshead South (Mrs Hodgson) and see the magnificent Angel of the North, I remember three simple words: “Made in Hartlepool.”
If our history is one of industry, innovation and growth, I must tell the House in all candour that it must also be our future. Too often, towns such as Hartlepool have been left behind, an afterthought in our national conversation, able only to reminisce about what we once were, not plan for what we can be. This must change, and I believe it will change under this Labour Government.
Right now, we are witnessing a new industrial revolution sweep the world as we shift to a net zero future. Whereas our past was in coal and ships, our future is in new nuclear, wave and tidal. The election of this Labour Government means that revolution is finally coming to our shores, with a national wealth fund investing in jobs in every part of the country, a proper industrial strategy that forges a real partnership with business, and Great British Energy, which will make the UK a clean energy superpower.
I am determined that Hartlepool will play its part in this transformative agenda, once again at the metaphorical coalface of our country’s prosperity and economic growth. That is nothing less than Hartlepool people deserve. They are my inspiration, with their defiance, grit and determination to succeed in the face of challenge. Even in the toughest of times, we come together, stronger, more united and standing up for each other.
Everywhere in our town, we see courage, community and compassion. I have been privileged to work with brilliant Hartlepool people every day to improve our town, from those in our voluntary sector organisations and community groups, our faith leaders, and those in our schools, colleges and clubs, including Hartlepool United; my children and I are proud season ticket holders. All of them are working together in the service of our town.
Hartlepool has produced many leading lights across a variety of professions, from Iron Maiden guitarist Janick Gers, world boxing champion Savannah Marshall, fashion designer Scott Henshall and television presenter Jeff Stelling, whose repeated and impassioned outbursts defending the north-east, its culture, heritage and people from those who would seek to criticise it display all the formidable characteristics of a person raised in Hartlepool.
The Prime Minister has rightly talked about putting his Government back into the service of working people. My unfaltering belief in public service was instilled in me from a young age. I want to take a moment to pay tribute to my father, Charles Brash, a doctor in Hartlepool for over 30 years. One of my earliest memories is of him coming home from a night on call—GPs did that in those days—having a quick bite to eat, and then heading straight back out for his morning surgery. Some people still call me “the doctor’s son”, and I wear it like a badge of honour. His career, spent in the service of others, shaped my values, and my belief that only by putting people first can we achieve the change we need.
I pay tribute to my predecessor, Jill Mortimer. Since her election in 2021, Jill has forged strong relationships in Hartlepool, particularly with veterans’ groups, which I hope to emulate. Public service is never easy, and I thank Jill Mortimer for her service to Hartlepool.
I close by returning to the idea of opportunity. Right now, in 2024, in one of the richest countries in the world, nearly 20% of Hartlepool’s children live in absolute poverty. Nothing could better symbolise the spectre of opportunity denied—the opportunity for a safe and secure upbringing, to fulfil their boundless potential, to get a good job and raise their own family in security and prosperity. So I welcome the announcement by my right hon. Friends the Secretaries of State for Education, and for Work and Pensions, on developing an ambitious child poverty strategy, because as Members know, the record is clear: when Labour is in government, child poverty falls.
I am privileged to stand in this place, but I will never lose sight of the fact that it is a privilege gifted to me by Hartlepool people, far too many of whom have been denied opportunity for far too long. Hartlepool people have a reputation for, on occasion, electing fighters as opposed to quitters, and I am pleased to tell the House that they have done so again. My duty, my service, is to fight for them every day to secure the brighter future that our town deserves.
Mr Deputy Speaker (Sir Christopher Chope)
I call Nick Timothy to make his maiden speech.
Nick Timothy (West Suffolk) (Con)
I congratulate the other new Members on their excellent maiden speeches, in particular the hon. Member for Hartlepool (Mr Brash), where I know his predecessor, Lord Mandelson, recommends the mushy peas.
It is an honour to be called to speak for the first time. I pay tribute to the last MP for West Suffolk, Matt Hancock, who oversaw the delivery of the covid vaccines, a vital achievement for our country. Less well known is that Matt once rode in, and won, the Blue Square Cavalry Charge horserace in Newmarket, a feat that required him not only to be propelled forward by a thoroughbred horse at 30 miles per hour, but to train for three months and lose 2 stone. For all these reasons, not least the dubiousness of the idea that I have 2 stone to lose, I can assure the House that I will not be stepping into my predecessor’s stirrups.
Newmarket is the best-known town in my constituency. It is most famous for horseracing, an international success story that brings thousands of jobs and hundreds of millions of pounds to the local economy every year. From Charles I to Charles III, racing gives West Suffolk its long connection to royalty, but unfortunately ours is not an unblemished record, for Newmarket was once the home of Oliver Cromwell’s new model army. Old Ironsides championed free expression yet persecuted his enemies. He attacked aristocratic privilege and patronage, but handed power to his cronies. Censorious, joyless and puritanical—it is like he wrote the Labour manifesto.
Fortunately, we have left those days of self-denial behind, and from the Star in Lidgate to the Queen’s Head in Hawkedon, the Affleck Arms in Dalham to the White Horse in Withersfield, and many others, we have some of the best pubs in Britain. And we have plenty more besides: beautiful villages, vibrant towns and farms that feed the country; Anglo-Saxon settlements and ancient churches; rolling countryside and big Suffolk skies; dense forest and the world-famous gallops; businesses doing everything from seed drills to particle engineering; charities such as Reach in Haverhill and the day centres in Brandon and Newmarket; Highpoint prison near Stradishall; the airbases at Lakenheath and Mildenhall; and public servants working for their communities every day.
I look forward to championing them all and addressing our challenges too, including dealing with flooding in Clare, Cavendish and elsewhere, and fighting the appalling decision to approve the Sunnica solar and battery farm, due to be built on high-quality agricultural land. In Brandon, lorry traffic is a problem. We need the Ely and Haughley junctions sorted to get freight on to the railways. In Mildenhall, where 1,300 new homes are coming, we need a relief road. We are not against new house building in West Suffolk—we have had 3,000 new homes built in the last five years—but we need attractive family homes in the right places. We need services and infrastructure to keep pace. We need to get tougher with the developers and reform the construction market. We need to drastically cut immigration, not just for the economic and cultural reasons that should by now be obvious, but to limit new demand for housing.
Our largest town, Haverhill, has doubled in size in only 30 years, to almost 30,000 residents. It has an incredible community spirit, but the town centre is struggling. We need a new start for our high streets, and I will fight for a railway linking Haverhill to Cambridge. The development of Cambridge looms large for us, but I want us to embrace the opportunities, not just fear the risks. If we get it right, we have the chance to get better infrastructure, new investment and more jobs. That is why I wanted to speak in today’s debate.
From potholes to public sector pay, the thread that runs through all our challenges is an inconvenient truth. While it is plainly incorrect to claim that the new Government have the worst economic inheritance since the war—[Interruption.] It is incorrect, but we are less prosperous than we often tend to assume. This is not a question of party politics, but of the decline and failure of our country’s long-established economic model. Put simply: we do not make, do or sell enough of what the world needs.
Our £33 billion trade deficit—1.2% of GDP—means we sell off valuable assets and build up external debt to limit the current account deficit. We end up with less control over our economy, and more exposed to global risks and shocks. From low pay to regional inequality, poor productivity to the funding of public services, all the things we worry about are symptoms of this wider problem.
We need to question economic theory, challenge Treasury orthodoxy and think beyond the intellectual limits of ideological liberalism. Theories like comparative advantage have led us to offshore industry and grow dependent on hostile states, like China. But international trade is neither free nor fair, and net zero cannot mean sacrificing our prosperity and security. Being a services superpower is a great advantage, but alone it is not enough. We need a serious strategy to reindustrialise, narrow the trade deficit and rebalance the economy. We need to change and, in the months and years ahead, I look forward to debating how we do so.
Mr Deputy Speaker (Sir Christopher Chope)
I call Alan Strickland to make his maiden speech.
Alan Strickland (Newton Aycliffe and Spennymoor) (Lab)
I congratulate the hon. Member for West Suffolk (Nick Timothy) on his maiden speech, and all those who have spoken for the first time in the House today.
It is an honour for me to make my maiden speech as the first Member of Parliament for the Newton Aycliffe and Spennymoor constituency. I pay tribute to those who came before me. The former Sedgefield constituency makes up the majority of the new seat. In addition, we have taken Spennymoor and Tudhoe wards from Bishop Aukland, and Coxhoe ward from City of Durham. I wish to put on record my thanks and pay tribute to Paul Howell and Dehenna Davison for their public service, and to my hon. Friend the Member for City of Durham (Mary Kelly Foy) for her continuing dedication to her constituents.
Unlike some former Members of this House, I am not fluent in Latin, but I am assured that the motto of my hometown translates as “Not the Least, but the Greatest we seek.” This has not only served as a powerful statement of intent for the new town of Aycliffe since 1947, but captures the shared spirit of the towns and villages across this new constituency—varied in history, but united in a desire to get on, to do well, to strive for a better future. My own family’s story is testament to this spirit of aspiration that has long defined the working people of our country.
Several generations ago, both sides of my family were drawn from mining villages across England to the Durham coalfields because of their reputation for good wages and reliable work. In turn, my grandparents moved from pit villages to Aycliffe new town, home for two years to the late Lord Beveridge, in search of modern housing and better jobs for their children. My parents’ generation then worked hard to give us the opportunities that they never had, including higher education, the chance to work across the country and across the world and personal freedoms to flourish. This ethos—that each generation raises the next, that background be no barrier, and that opportunity be distributed as widely as talent—is the driving force in families in my constituency and a lodestar for this Government.
But making that a reality requires strong economic growth across our country. We must back the industries of the future, such as Hitachi Rail in my constituency, which manufactures world-class, green trains, and employs 700 highly skilled workers and another 1,500 in the supply chain. I thank a former Member of this House, Phil Wilson, for his tireless campaign, alongside The Northern Echo, which led to the plant being located in the area some years ago. I am also grateful for the public commitments made by my right hon. Friends the Prime Minister, the Chancellor and the Transport Secretary to support Hitachi’s future. I look forward to working with them to secure those jobs and expand high-tech manufacturing more widely. That includes the innovative work at Sedgefield’s NETPark. This Durham University spin-off hub develops innovative products in satellite technology, drug development and biological weapon detection, which are then exported around the globe. The creation of jobs in the industries of the future is particularly important in a constituency with former mining communities, where ongoing economic development is badly needed.
I do not want the House to think that my constituency is all work and no play. We are famous for the Sedgefield ball game—a historic Shrove Tuesday tradition not for the faint-hearted. We are home to excellent football clubs, including Newton Aycliffe, where my parents served on the committee, and Spennymoor Town. Spennymoor itself typifies our rich cultural history, with a heritage trail dedicated to Norman Cornish, one of the pitmen painters, who learned his craft alongside his mining in the Spennymoor settlement.
Some of the best brass bands in the country can also been found in the constituency. They not only keep alive the cultural traditions of our past, but provide excellent, high-quality music education for new generations of young people today. We are also home to incredible local produce, including artisan chocolate made in Coxhoe, and award-winning real ale brewed at the Surtees Arms in Ferryhill—I have personally quality-assured the latter on several occasions. On the topic of ale, my predecessor Tony Blair was noted for hosting world leaders in pubs across the constituency. I have yet to find a pub without a photo of the former Prime Minister and his closest NATO allies, but my diligent search continues.
Finally, I am proud of our thriving community organisations. The Ladder Centre does invaluable work to support residents, and the Cornforth Partnership is a lifeline for those looking to get back into work. Just as Durham coal powered our economy in the past, so constituencies such as mine can power our modern economy, with high-tech, green manufacturing and research.
Let me return to where I began—“Not the Least, but the Greatest we seek.” Mr Deputy Speaker, in this House, let us commit ourselves to seek the greatest—the very best—for our constituents, for our communities and for our great nation. I look forward to seeing the economic measures in the King’s Speech start to spread wealth, growth and opportunity to every corner of this United Kingdom, including the people of Newton Aycliffe and Spennymoor.
Mr Deputy Speaker (Sir Christopher Chope)
I call Greg Stafford to make his maiden speech.
Greg Stafford (Farnham and Bordon) (Con)
Thank you, Mr Deputy Speaker, for calling me to speak. I congratulate the hon. Member for Newton Aycliffe and Spennymoor (Alan Strickland) on his maiden speech. I do not think that we crossed over at university, but mutual friends tell me that he was an excellent president of the Oxford Student Union. We can tell that his debating skills were honed there, and we saw that in evidence this evening.
I want to express my gratitude to the people of the new Farnham and Bordon constituency for placing their trust in me and for allowing me the honour to represent them here in Parliament. I feel that giving a maiden speech is a bit like giving a best man’s speech at a wedding, as you are surrounded by disapproving elderly relatives who are going to hang on every word, but I can assure you, Mr Deputy Speaker, that none of the jokes that I have made before in any best man’s speeches will be given in this House, especially as I know that my mother-in-law is watching on the Parliament channel.
I also wish to thank my family—especially my wife, Caroline, and my daughters, Susannah and Lucy, who have put up with me a lot over the past year—for their patience and support, as well as my parents, James and Theresa.
Other hon. Members have noted that they are not the first people in their family to be Members of Parliament. I am not even the first sibling to be a Member of Parliament. I pay tribute to my brother, Alexander, who served the people of the Rother Valley constituency so diligently in the previous Parliament.
Apparently, it is also customary to express gratitude to our predecessors in the seat—a small political obituary, as it were. Fortunately, both my immediate predecessors, my right hon. Friends the Members for Godalming and Ash (Jeremy Hunt) and for East Hampshire (Damian Hinds), are still, as Members can see, very much in their political prime. None the less, I want to thank them for their generous support and advice since I was selected. They have both achieved amazing things for the constituents whom I have inherited. Campaigning was a sobering affair. On the doorsteps I was told: “Oh, we do like Jeremy”, or “Damian did such wonderful stuff for us”, or “You have very big shoes to fill”. To rub salt into the wound, the week before the election, the local paper ran a story on how much the people of Haslemere would miss the shadow Chancellor—believe me, I know my place.
Speaking of predecessors, the predecessor of my right hon. Friend the Member for East Hampshire, Lord Arbuthnot, should be praised for his sterling work on the Horizonscandal and for bringing justice to the sub-postmasters so cruelly affected. I still hope that those who were responsible—by act or omission—are brought to justice.
The newly created Farnham and Bordon is a county constituency crossing Surrey and Hampshire, making the life of a new Member of Parliament even more complex than it already is. More than that, the name, while referencing the two largest towns in each county, ignores the other towns of Haslemere and Liphook and the many villages that range between the larger population centres. Many argued for, and I supported, a less specific but more all-encompassing name for the constituency, such as the Wey Valley, taking its name from the beautiful River Wey that runs through it. Clearly they are not romantics in the Boundary Commission, so Farnham and Bordon stuck. The only saving grace is that its initials spell FAB, which sums up the area that I represent.
This “FAB” constituency ranges from Farnham in the north to Haslemere and Liphook in the south, Whitehill and Bordon in the west, and the western villages of Surrey, such as Tilford, in the east. Bookended by the north and south downs, it is an area of outstanding beauty, with thriving market towns, pleasant villages, and a thriving sports and arts scene, including the prestigious University for the Creative Arts. It also has a significant military connection, most obviously in Bordon, which was home to the Royal Electrical and Mechanical Engineers until 2015 and is home to the Longmoor ranges, where Ukrainian troops are being trained. Military history is everywhere, from Amesbury school in Haslemere and Hindhead, where Montgomery lived during the war, to the Canadian war graves and memorial in Liphook, and the site of the first-ever two-minute silence in this country on Castle Street in Farnham. The residents of this new constituency are ever thankful for the role that our armed forces have played in keeping us safe.
From Arthur Conan Doyle to Jonny Wilkinson, King John to Flora Thompson, and Graham Thorpe to the hon. Member for Boston and Skegness (Richard Tice), heroes and villains have been born, lived, worked and played in this fabulous constituency, but it is not the beautiful scenery, the historic gems, or the famous people who make this constituency the best in the country. It is not even the fact that my grandparents ran Stafford’s sweet shop in Haslemere for many years—what little boy would not want grandparents who ran a sweet shop? It is the current residents, businesses and community spirit that make FAB special, and a joy to represent. Every day there are local events, charitable occasions and community festivities to get involved with. Indeed, I doubt that anywhere else in this country can rival the number of duck races in the area.
Following that Cook’s tour of the constituency, one might be forgiven for thinking that there are no issues to solve—a home counties garden of Eden. It of course cannot be denied that there are many areas of significant affluence, but it should not be concealed that there are areas of high deprivation, and I will champion their improvement. The constituency’s location is both a benefit and a curse. Within easy commuting distance of London, it provides a rural haven for those who wish to live outside but work in the city. That also makes it rich pickings for housing developers who look for any open space, green or otherwise, to build on. I am not against housing development—we need homes for our children and grandchildren—but we need the right homes in the right places, with the right tenure mix and with the supporting infrastructure.
Conservative-run East Hampshire district council has done everything that it can to persuade the new Government to modify their housing targets to make them more appropriate for our area, including writing to the Deputy Prime Minister. I hope that she will respond positively. Indeed, if there is one issue that unites the whole of the new Farnham and Bordon constituency, it is that infrastructure has not kept pace with development. That is particularly acute in Bordon, where thousands of houses are going up without the supporting infrastructure. The GP surgeries, the NHS dentists, the schools, the roads and the leisure centres all need upgrading and expanding rapidly to meet that housing growth. We must not build more houses until infrastructure catches up. Otherwise we will be left with housing estates devoid of services, security and society. I am deeply concerned about the new Government’s plans on house building. Labour’s changes to planning, imposing top-down targets and removing the rights of local people to have their say on developments, is a retrograde step that has been met with anger from my constituents and resolute opposition from me.
I mentioned the need for health services in our area. Having spent most of my career in healthcare, latterly working for seven years in the NHS, improving clinical services and patient outcomes, I know that both locally and nationally things need to change in the NHS. We need to have a grown-up and honest discussion with the public about how we are going to deliver, provide and fund the NHS and social care going forwards. For an ageing population with increasing healthcare needs and diminishing birth rates—that is, the people who are going to pay for the NHS—we need a cross-party discussion that brings all parties together to make long-term decisions on how we proceed with health and social care in this country. If I achieve nothing else in my time here, starting that conversation, and hopefully progressing it fruitfully, will be something to hope for.
As a traditional, common-sense Conservative, I believe that we cannot pay for health and social care unless we have a strong economy. Despite a global pandemic, a war in the east of Europe and instability in the middle east, and regardless of the picture that the Government are trying to paint in their press releases, the most recent statistics show that the economy is turning around and is on an upward trajectory. I will oppose any measures by this Government, including the misguided nationalisation of industry and the socialist labour rules, that I believe will hamper or reverse that trend.
Equally important is to safeguard ourselves from external threats. The rise of a resurgent Russia, China and North Korea is something that we should all be concerned about. I do not believe that it is hyperbole to say that we are in a pre-war era, and we need to ensure that our borders, skies and infrastructure, both physical and digital, are safe from threats. That is why I absolutely believe that we should move to 2.5% of GDP spent on defence immediately, and increase that to 3% when practical.
In short, we must protect our economy, healthcare and national security to ensure the prosperity and safety of our country, but mindful that maiden speeches are not meant to be controversial, I shall leave it there and return briefly to the subject of my FAB constituency. In 1668, Samuel Pepys recorded that the people of Liphook were “good, honest people”. Given his own morals and motivations, I am not sure whether he meant that as a compliment, but I assure the House that it is as true now as it was then for the residents of Farnham, Bordon, Haslemere, Liphook and our surrounding villages, and I pledge to be a good, honest servant of them in this place.
Mr Deputy Speaker (Sir Christopher Chope)
I call Rachel Blake to make her maiden speech.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Thank you, Mr Deputy Speaker, and I thank the hon. Member for Farnham and Bordon (Greg Stafford) for describing his constituency so passionately. While we may strongly disagree on the need for growth and new development in this country, we may agree more on the future of our NHS, and I look forward to working together on that ambition.
I am a proud Londoner, and like many Londoners I was not actually born here; I am delighted to share with you that I was born in Manchester and my family comes from Lancashire. In fact, for most of my childhood I was aware of only one football team—the Bolton Wanderers—but for the last 42 years London has been my home, and the chance to represent my home city is truly a special honour. I put on record my thanks to the residents of the Cities of London and Westminster for placing their trust in me as their representative.
I start by thanking Nickie Aiken for her service. She is a pioneer, as the first woman to represent the Cities of London and Westminster, and is remembered fondly by many residents. She has shown me kindness and offered her advice, for which I am grateful. I know that here and across the constituency she will be remembered for her tireless work campaigning to regulate pedicabs, and her work to end the Vagrancy Act 1824 and deliver the Leasehold and Freehold Reform Act 2024. I also pay tribute to my good friend Karen Buck, who represented the St John’s Wood neighbourhood wards of Abbey Road and Regent’s Park, which joined the two Cities constituency in the recent boundary review. When walking through Westminster with Karen, it is hard to find anyone in her constituency who does not know her and has not been helped by her. Through her tireless casework for tens of thousands of constituents, and her Homes (Fitness for Human Habitation) Act 2018, Karen has made an outstanding contribution to lives in Westminster and beyond. She is a fearless representative and campaigner and a kind and wise friend. I am so grateful for her advice, and will do my very best to live up to her high standards.
From 1977 to 2001, the two Cities were represented by Peter Brooke, who is remembered for his work as the Secretary of State for Northern Ireland, and later as the Secretary of State for National Heritage. Finally, I also remember J. S. Mill, who represented the City of Westminster from 1865 to 1868, and who in 1866 became the first person in the history of Parliament to call for women to be given the right to vote. I hope that he would be happy to see Nickie, Karen and I delivering on his pioneering work for equality here in the two Cities.
Truly, when a woman is tired of London she is tired of life. The Cities of London and Westminster are home to great cultural institutions: the national gallery, the royal opera house, the commercial centres of Oxford Street and Edgware Road, innovative start-ups alongside major international corporations, the Government here in Westminster and Whitehall, the international financial centre of the City of London, the beautiful Hyde Park, Regent’s Park and St James’s Park alongside the residential squares of Belgravia and Marylebone, and yes, Buckingham Palace.
Many Members will know the neighbourhoods of Soho, Fitzrovia and Covent Garden as places to spend a night out. In fact, tens of thousands of people live here. We have St Bartholomew’s, one of London’s oldest churches, Bevis Marks, the oldest practising synagogue in the UK, and London Central Mosque. Just minutes away from Parliament we have the Peabody estates of Westminster, the pioneering and beautifully designed Churchill Gardens and Lillington and Longmore estates, the architectural delights of the Barbican, Golden Lane and the historic communities of Petticoat Square and the Guinness estate in Portsoken ward.
All those places are home to diverse communities living side by side, but also to inequality and injustice, and the struggle to find a stable, affordable and decent home is holding people in my constituency back from meeting their potential. That struggle is holding our city and our country back from meeting our potential. Tackling the housing crisis has brought me into politics, and this debate on the King’s Speech proposals for economic growth is an important time to highlight the situation that many of my constituents face. Nearly 20 years ago, I worked at the Treasury on the Barker review of planning. It is with sadness that I note that we are still not delivering the homes we need. I am determined that this Government will deliver on our promise to build more affordable homes.
Ending no-fault evictions will bring certainty and security for the approximately 40% of households in the Cities of London and Westminster who are renting privately. Our cross-Government strategy will put Britain back on track to ending homelessness, rough sleeping and temporary accommodation, which have been rising here for years and are harming so many. I am grateful to organisations such as The Passage and The Connection here in the two Cities for doing so much to support vulnerable people. The Cities of London and Westminster has one of the highest proportions of leasehold homes in the country. Residential leasehold is trapping tenants with unaccountable landlords, and I am pleased the Government have pledged a leasehold and commonhold reform Bill.
It is characteristic of such an international place that global patterns affect our local communities. The rise of short-term letting and the risk of dirty money in property are contributing to a loss of homes for Londoners, and as their representative here I am determined to tackle that. I will be standing up for our local hospital and St Mary’s in Paddington, and continuing our campaign to secure funding for the redevelopment of London’s major trauma centre.
The story of the two Cities is one that is optimistic, outward-looking, hard-working and driven. I hope to continue to represent this place in that fashion. I am the first Labour and Co-operative Member of Parliament to ever represent this historic constituency, and I join colleagues in closing with a pledge to approach this new Parliament with a renewed commitment to respectful debate and disagreement. Elections are a time to make a choice. Now that a decision has been made, it is time to move forward with a relentless focus on public service and delivery.
Mr Mark Francois (Rayleigh and Wickford) (Con)
Thank you, Mr Deputy Speaker, for kindly calling me to contribute to this important debate on the King's Speech, after 11 very good maiden speeches and 11 very promising—even fabulous—starts to parliamentary careers. Those who have been in this House a little longer will know that our great friend the late Sir David Amess, whose plaque now rightfully hangs on the wall, had a great talent for managing to combine a very large number of topics into one speech. I lack Sir David’s skill, so I will seek to confine my remarks this evening to three topics, all development related.
The first topic relates to an expansion in medical capacity for the NHS, and specifically to proposals to expand the Jones family practice in Hockley. I declare an interest: my wife Olivia has worked in the NHS for nearly 20 years. In essence, the plan is to expand the practice, with a first-floor extension to create eight new GP consulting rooms and additional training facilities. Rochford district council recently approved planning permission for the extension, and the senior partner, Professor Dr Mahmud, and his active practice management team are now seeking approval from local NHS bosses to support the scheme.
It is my intention as the recently re-elected local MP—for which I am very grateful to my constituents—to lend weight to these positive proposals. They are designed not just to expand capacity, but hopefully to provide training places for graduates from the new medical school at Anglia Ruskin University in Chelmsford. For the record, I have also been working for some time to try to expand Riverside medical centre in Hullbridge, and I will be pursuing that with the NHS as well.
Secondly, the town of Wickford has suffered a dearth of supermarket capacity in recent years. My constituents endured something of a perfect storm last year when the Aldi supermarket was closed, while at the same time the old Co-op nearby has effectively stood semi-derelict for three years. During that supermarket vacuum, my constituents were forced to fall back on the small Iceland in the high street and Wickford market.
I was very pleased to reopen the enlarged Aldi last autumn, and it is now doing a brisk trade. However, the Co-op still remains undeveloped and, while boarded up, is occupying valuable spaces in the town’s principal car park. It is a long and complicated saga. Suffice it to say that the site was bought several years ago by a development company named Heriot, which originally came up with a plan in conjunction with the supermarket chain Morrisons to redevelop the store, with an underground car park and some flats above. I always had doubts about the commercial viability of those proposals, especially the underground car park, and the scheme collapsed some months ago.
Nevertheless, Heriot is working on what might be called a plan B, and for some months has been in what it describes as “advanced talks” with another major supermarket chain. For commercial reasons Heriot asked me not to name the supermarket in this speech, something I have agreed to respect—although I have to say that the name of the company in question is now effectively an open secret, and was even being reported back to me on doorsteps by my Wickford constituents during the general election.
I spoke to the directors of Heriot in advance of this debate, who assure me they are seeking to bring their commercial negotiations to a conclusion as soon as possible. They are well aware of my frustration at these three years of delay, which I conveyed to them again this morning, and they have asked me to relate that they realise that my Wickford constituents have already waited a long while for a new supermarket. That is an issue I campaigned on heavily at the general election, so I hope Heriot will be able to announce something definitive this summer. My message to Heriot is simple: “You have had more than enough time—get on with it.”
Finally, over two decades I have seen examples of both good and bad development in my constituency. Young people cannot live at home with their parents into their 50s and 60s, so it must be possible to build some houses in a sustainable manner to meet the housing need. Crucially, however, the infrastructure required to accompany them has to be built first. To put it another way, from long experience, if development is to be successful—and it can be—as I said earlier, it has to be done with people, rather than to people. The proposals at a place called Dollymans Farm in my constituency, which I was re-elected with a mandate to oppose, are precisely the opposite of that. We all want to find somewhere suitable and appropriate for people to live, but we have to do that in the right way.
Ruth Cadbury (Brentford and Isleworth) (Lab)
It is an honour to be re-elected for the fourth time to the redrawn seat of Brentford and Isleworth, and to follow such impressive maiden speeches, particularly that of my hon. Friend the Member for Cities of London and Westminster (Rachel Blake), in whose constituency we all work.
After nine years sitting in Opposition it is a pleasure to be on the Government side of the Chamber and to support this Government’s legislative programme, which brings hope, opportunity and change for my constituents and for the country at last. I will focus my response to the King’s Speech on the Government’s ambitious proposals around transport policy—not only because it is an area I have long been involved with, having served on the Transport Committee for five years and chaired five all-party parliamentary groups on transport, but because transport was brought up regularly on the doorsteps in this last election.
The theme of today’s debate is economy, welfare and public services. Effective transport policies are essential to the change we need to see in all three areas, as well as in addressing our climate crisis, so I am pleased to see the bold and ambitious plans set out by my right hon. Friend the Member for Sheffield Heeley (Louise Haigh) and her team to do just that. For access to work, education and health services, for supplying our manufacturing and retail sectors and for supporting our wellbeing and family life, decent transport choices are essential, and nowhere are they more needed than in the new communities that will be built, if the traffic on the roads to and around them is not to grind to a halt. Whether in city, town or countryside, we need the full range of transport options—ones that are affordable, accessible, efficient and environmentally sound.
On buses, I am delighted that, through the better buses Bill, the Government will end the ideological and control-freakery policy of banning local authorities from running their own municipal bus companies. Such companies were killed off by the Thatcher Government in a bout of ideological rage, with only London retaining a regulated bus service. The rest of England should have what we have in London: regular day, evening and weekend services, simple fare structures, and high standards of safety, accessibility and passenger information. Those are being developed by the Mayor of Greater Manchester, Andy Burnham, and I look forward to seeing other local authorities—of all parties, I am sure—following his example.
To be an alternative to driving, and for us to cut road congestion and pollution, rail travel must be reliable. I am therefore delighted to see Bills to create Great British Railways and to bring train operations into public ownership. That is essential for a simplified and unified rail system that focuses on improving passenger services while getting value for the taxpayer. Our constituents, and many Members of this House, have had terrible experiences of cancelled trains, or of sitting on the floor for hours despite booking a seat. We will now see a Government and a Department that do not use transport as a cudgel in our culture wars, or as a crude electoral hammer to override local authorities that want to introduce sensible measures to encourage cycling and walking.
Transport is at the heart of the challenge of national renewal that we have set ourselves: kickstarting economic growth, boosting jobs and living standards, and building sufficient homes in sustainable communities. Of course there are challenges ahead—not least in further growing capacity in our overloaded rail network. I welcome the plan to improve east-west connectivity across the north of England, but funding further increases in rail capacity will unfortunately be financially unsustainable until we see the economic growth that the Chancellor is working on. Aviation expansion is acceptable only if it passes the four tests that we set ourselves in opposition: cutting carbon dioxide emissions, overcoming local environmental impacts, providing regional benefits across the UK, and deliverability. I know that the new Secretary of State and ministerial team will work across our travel and transport sectors to improve transport connections to the benefit of our country as a whole.
Mr Deputy Speaker (Sir Christopher Chope)
I call Robin Swann to make his maiden speech.
Robin Swann (South Antrim) (UUP)
It is with honour and humility, and a sense of trepidation, that I rise to make my maiden speech. I think of those who have spoken here before and the gravity and seriousness of the issues that have been debated and discussed. I hope that this Parliament is no different in how it discharges its duties, and that we in this intake of new Members live up to those standards. I congratulate the many new Members on their maiden speeches, which have set a high bar.
Like everyone else in this House, I wish to thank sincerely those who placed their faith and trust in me by electing me. I am indebted to the electorate of South Antrim for the support that I have received from across the entire community—indeed, entire communities—in my election to this place. I also thank the dedicated campaign team who supported me during what was an honourable campaign.
I pay tribute to my predecessor, Mr Paul Girvan, not just for his tenure as a Member of this House, but for his time as a Member of the Northern Ireland Assembly and as a local councillor. South Antrim has moved between Paul’s party and my Ulster Unionist party on a number of occasions. With that, I carry the privilege and honour of returning the UUP to this place after a seven-year absence, and the charge and responsibility of bringing a moderate and reasoned Unionist voice from Northern Ireland, in my party’s tradition of working positively and constructively with all to achieve the best outcomes for all our people, and of working across this House to strengthen our Union and to deliver a Union for all.
I turn now to my constituency of South Antrim. I want those here this evening to know what a fantastic part of our country it is. Like so many constituencies, it has a mix of main towns—Ballyclare and Antrim—and a range of what were once small villages but are growing into large villages, such as Toome, Doagh, Crumlin, Randalstown, Templepatrick, Ballynure and many more. Much of the constituency is a large and productive rural area, while part of the expanding urban area of Glengormley is merging with north Belfast in Mossley and Mallusk.
South Antrim is home to industry, research and cutting-edge business in large and small employers. Indeed, I look forward to working with the Chancellor and her Government in further supporting those businesses through the Bills in the King’s Speech, and especially through the national wealth fund. South Antrim is the base of Belfast international airport, which I believe has a real opportunity if it gets its much-needed rail link and the further expansion of Aldergrove and our Royal Air Force base. That is why I believe that we also need a UK air transportation strategy, which I may raise later in the Adjournment debate—if the hon. Member for Strangford (Jim Shannon) will take an intervention from me!
South Antrim’s agricultural sector is another pillar of our community and contributes significantly to our local economy. Our annual Antrim agricultural show celebrates that agricultural heritage by bringing together farmers, producers and visitors from across the country and showcasing the best of rural life and promoting a strong sense of community. It is on this Saturday at Shane’s castle, and I would encourage and welcome anyone who wants to attend.
Loch Neagh—the largest freshwater lake in the British isles—is another jewel in South Antrim’s crown, but it is currently struggling because of neglect, like many of our waterways. However, the Stormont Executive’s new recovery programme is in place, and I hope that—with national support, given the need for action on our waterways—Loch Neagh will once more be a tourism and recreational attraction for visitors from far and wide.
A number of issues debated over the past few days will have a direct impact on the people of South Antrim, Northern Ireland and the United Kingdom—none more so than the future and support that the Government will offer our national health service and those who rely on and work in it. The Government have the opportunity to reverse the past years of neglect. Health may be devolved, but that does not mean that we in this place can abdicate all responsibility for our national health service. We have the excellent Antrim area hospital in my constituency, but it needs resource and support to develop its potential. As a former Health Minister of Northern Ireland, I know that we have plans to deliver better services, but change needs recurrent resources, which have been lacking in recent years. I look forward to working with this Government to rebuild our national health service.
I know that I am speaking to the converted on how great South Antrim is, because I have been overwhelmed by the number of Members from across the House who have approached me to tell me of a relative or friend who lives in my constituency. Indeed, I look forward to representing them and all my South Antrim constituents in this place.
Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
I congratulate all the hon. Members who have made their maiden speeches on their passion and their commitment to their constituency, which has come across so well. Age does not wither, nor custom stale the privilege of being in this place, and I too want to thank my constituents, who have returned me to Parliament to represent them all and the wonderful city we call home.
I spent 14 years on the Opposition Benches, standing up for my constituents against a Government who were bearing down on them. It is absolutely fantastic to speak from the Government Benches in support of a Government who will help and empower them. Some Conservative Members have been painting a rosy picture of our economic inheritance, but the message of working people in Newcastle upon Tyne Central and West was clear and consistent: “We need change.” It is not hard to see why. People are worse off; over a third of children in Newcastle upon Tyne Central and West live in poverty; and over 2,000 households in Newcastle are homeless. Those are just a few of the issues that my constituents face, so please, let us not pretend that we should be grateful to the last Government.
But everything changed on 4 July. Indeed, as I was buying my fish supper last Friday at one of the excellent fishmongers in Grainger market—locally smoked cod, since you ask—they told me that on 5 July, sales of halibut soared. That is an expensive fish, so they took that as a sign of celebration, but also of optimism, hope, and confidence in a better future. There is nothing fishy there, because the Bills set out in the King’s Speech will give Newcastle our future back. Our destiny will be in our own hands, with the English devolution Bill and the better buses Bill giving local leaders such as our fantastic Mayor Kim McGuinness the powers needed to drive growth and prosperity locally. Our region’s immense potential in the green industries of the future will finally be unlocked through the national wealth fund and Great British Energy; planning reform will take the handbrake off building new homes and spaces for business, making us an even greater city with an economy that provides great jobs and good homes for all Geordies; and by expanding the rights of workers, tenants and minoritised groups, the Government will make sure that work pays and everyone in Newcastle enjoys their fair share of our national prosperity.
Having worked around the world as an engineer, I have been proud to champion science and innovation in Newcastle and across the UK. I am now privileged to have both of Newcastle’s fantastic universities in our constituency, and our city is looking forward to building a proper industrial strategy once again—one that can boost our universities as drivers of inclusive economic growth. Unlocking private investment through measures such as the national wealth fund and the recently announced pensions review will super-charge spin-outs and start-ups in the north-east, and I believe that sites such as Helix—home to innovative businesses and entrepreneurs in cutting-edge industries—are a tantalising glimpse of the future of Newcastle.
Technology has the power to make our constituents’ lives so much better, and measures such as planning reform will make that a reality. As an ex-shadow science Minister, I have spoken to Lord Vallance, as he begins his ministerial role, to offer my support, and to make the case for investment in regional research and development. I know that the Department for Science, Innovation and Technology team are already committed to opening up careers in science to everyone, getting money outside the golden triangle and connecting science to industrial strategy, healthcare and economic growth.
As I have said, this Government inspire hope that has been lacking in Newcastle— that is, apart from on match days. That is why, as the MP for St James’ Park, I welcome the football governance Bill. From Mike Ashley to the Saudi Public Investment Fund takeover, football governance has been a thorn in our side, and Geordies around the world will welcome the safeguarding of our precious football club.
My constituents sent me to this place because our party promised change. With this King’s Speech, with this Government back at the service—
Mr Deputy Speaker (Sir Christopher Chope)
Order. I call Olly Glover to make his maiden speech.
Olly Glover (Didcot and Wantage) (LD)
Thank you, Mr Deputy Speaker, for the opportunity to give my maiden speech today. I aspire to match the eloquence of the previous speakers in this debate, including the hon. Member for South Antrim (Robin Swann), who gave the most recent maiden speech; his passion for his constituency is very clear.
I start by paying tribute to my immediate predecessor, David Johnston. I admire the fact that Mr Johnston entered politics because of his passion for social mobility. I have met constituents who have been personally helped by him, and I aspire to follow his lead. I was pleased that the first email in my parliamentary mailbox came from Lord Ed Vaizey of Didcot, Member for the predecessor seat of Wantage between 2005 and 2019, offering his congratulations. That was a warm and encouraging gesture. I arrive in Parliament following a career on the railway, serving the public, and I hope to apply my knowledge and experience to working with others to advance both rail infrastructure and public services in my seat.
The name of the new Didcot and Wantage constituency is an improvement on the previous name, Wantage, but remains imperfect. While Wantage and Didcot are the larger towns of the three in the seat, residents from Wallingford are aggrieved by their omission. Mr Deputy Speaker, I can assure you and this House that all three towns will have my attention and care. The same applies to the dozens of villages in the seat; I am fortunate enough to live in one of them, Milton. All our villages have a unique character and set of attractions. Pendon museum in Long Wittenham includes an homage in model railway form to the 1930s Vale of White Horse landscape, and there is also the ancient Uffington white horse and the beautiful chalk streams of the Letcombes. The constituency’s economy is diverse: we have the technology and science centres of Milton Park, Harwell campus and Culham near to farms that have been passed down through generations. Didcot hosts many industrial and business units, and residents benefit from the great western main line for fast commuting to and from London. Organisations such as Didcot TRAIN, the DAMASCUS youth project and Sustainable Wantage illustrate the strong culture of public service and volunteering.
My constituents rightly have high expectations. During the election campaign, one of them highlighted the lack of biographical detail in a leaflet about me, and asked me whether I was a doctor, a surveyor, a banker, a teacher, or an alien from outer space. Despite my love of the voyages of the crew of the USS Enterprise, Mr Deputy Speaker, I can reassure you and everyone in this House that I am not an alien. Of course, my constituency contains many non-humans, albeit perhaps not aliens. Many a local party volunteer has come to tire of my frequent canvassing of cats as well as humans. On occasion, this has helped my cause: while I was in conversation with one voter, his cat, Matthew, intervened. Matthew took a strong liking to me, with a great deal of leg-rubbing, even sitting on my lap on the pavement. The voter, astonished, told me that Matthew hates nearly everyone, and that his favourable verdict on me would be taken into account.
Turning to the subject of today’s debate, my constituency shares many of the same challenges as the wider country. Access to GP appointments is often difficult, particularly in Didcot, which continues to yearn for a new GP surgery in Great Western Park. NHS dentistry barely exists, and sewage dumping in our waterways is a great concern, as are proposals for a large reservoir near Steventon and the Hanneys. Many residents desire to walk and cycle more, but need pleasant and safe routes and paths in order to do so, and while the constituency benefits from fast railway connections, the reliability and capacity of the service provided can be somewhat patchy, and we continue to lack a railway station serving Grove and Wantage.
Perhaps the greatest issue on constituents’ minds is the cost of housing and recent, very substantial increases in the numbers of houses. I commend the Government on their commitment to genuinely affordable housing, but ask them to bear in mind that residents would be more supportive of housing growth were the health, education, and transport facilities needed to support it delivered in parallel. I promise to work tirelessly for my constituents in the pursuit of progress on these issues, and thank them again for the opportunity to serve. It is a genuine honour to be stood here, and I look forward to working with Members from across the House to achieve those aims.
Mr Deputy Speaker (Sir Christopher Chope)
I call Josh MacAlister to make his maiden speech.
Josh MacAlister (Whitehaven and Workington) (Lab)
Thank you, Mr Deputy Speaker. I pay tribute to the fantastic maiden speeches that we have heard from across the House this evening, including that of the hon. Member for Didcot and Wantage (Olly Glover); I am sure that the whole House is reassured to know that he is not an alien.
The first and only time I entered this Chamber before being sworn in as a Member of Parliament was as a secondary school citizenship teacher, bringing dozens of teenagers here to see their Parliament. On that occasion, I was required to use my teacher voice a number of times, but that is not something I plan to make a habit of in this House.
I begin by putting on record my thanks to my predecessor for the now abolished Copeland constituency, Trudy Harrison. We may disagree on matters of policy, but she has been unfailingly gracious to me and generous with her time, demonstrating the “country before party” approach that we can all learn so much from.
I may be new to this House, but I am not new to pushing Governments to get things done, as Opposition Members will know only too well, and I have worked with a number of Education Secretaries over the years. I founded and led a national charity to get more people into fulfilling careers on the frontline of children’s social work to ensure that every vulnerable child has a champion fighting their corner. From that, I was asked by the last Government to chair a landmark independent review of the children’s social care system. That review found that the disadvantage faced by the care-experienced community in our country should be the civil rights issue of our time. Evidence of that disadvantage is found in worse education outcomes, worse health outcomes and shorter lives, but that disadvantage is fuelled by something that politicians often find too hard to discuss, and that MPs certainly find too hard to mention in this Chamber: the absence of love. I believe every child has the right to be loved, and we have the ability to build a care system that can provide that for them. I hope this Parliament will take up the challenge of addressing this moral outrage. The problem is huge, but the solutions are known, and with enough will, tens of thousands of lives can be transformed.
It is a great honour and privilege to stand here as the first Member of Parliament for the new Whitehaven and Workington constituency. Whether it is the people of Whitehaven or the good people of Workington who are the jam eaters continues to be a source of fierce debate. Of course, I will remain neutral on that question, as I will on all rugby league-related matters.
Nowhere is more blessed than my constituency, home to the highest peak and the deepest lake in England, with miles of beautiful coastline and the stunning western part of the Lake district, which has inspired millions. Let me here pay special tribute to our amazing mountain rescue volunteers, our Royal National Lifeboat Institution volunteers—just this week, it will be celebrating its 200th anniversary—and all those who give up their time to volunteer in search and rescue services. I have an interest to declare as a serving mountain rescue volunteer, and I will champion volunteer search and rescue services at every opportunity.
Behind the doors of the towns and villages across my constituency, you will find the warmest and friendliest marras in the country, people forged by the drama and confidence of the surrounding landscape and people with humility, respect and determination at their core. These are people such as Gary McKee, who ran a marathon every day for a year to raise over £1 million for cancer support; those in the growing network of Andy’s man clubs in our community, tackling the crisis of male suicide that my area faces; and community leaders, such as Rachel Holliday of Calderwood House, giving people a route out of homelessness.
Our area has also forged those who were not born West Cumbrian, but who made our corner of the world their home, including pioneers and entrepreneurs such as Frank Schon, later Baron Schon of Whitehaven. Frank was an Austrian refugee who fled the Nazis, was bombed out of London and was taken in by a kind Cumbrian farmer. He went on to set up and lead a global chemicals company based in Whitehaven, before later chairing Harold Wilson’s development corporation and going on to serve in the other place. Today, my community is home to dozens of Ukrainian families that could well have the next Frank Schon in them. I hope we can offer those who wish to stay a permanent home here in this country.
Lord Schon is one famous example, but there are thousands of men and women like him—from Whitehaven to Workington, Gosforth to Egremont, Cleator Moor to Seascale and Flimby to Seaton in the north of the constituency—pioneers, entrepreneurs and grafters who have helped west Cumbria to lead the world. It is because of this graft that my constituency is home to the UK New Balance trainer factory—I am not wearing them right now—and the Iggesund paper mill, which has been experimenting with leading carbon capture technology. It is home to Forth Engineering and React Engineering, and hundreds of other businesses represented by Britain’s Energy Coast Business Cluster, from the coal and iron mines to the steelworks.
Of course, there is the world’s first civil nuclear power station at the site now famously known as Sellafield, home to a world-leading decommissioning mission, which is stimulating innovation in robotics and AI. We led the world, and we can again. We have the people, the will, the determination and now, thankfully, the Government to do it. Our nuclear heritage and our skilled workforce mean we have what it takes to be the ideal location for the next generation of nuclear power. The Government are determined to make the most of new jobs in the energy transition, to reform our broken planning system and to decarbonise the grid, and these three things offer the opportunity for the people of Whitehaven and Workington to fly.
A Labour Government with a proper industrial strategy and the right targeted investment could completely transform the economic geography of my community. These are decisions that need to be made to create the growth we have promised and to tackle the climate crisis our planet faces. I am determined to play my part to deliver this Labour Government’s mission and to ensure that west Cumbria feels the maximum possible benefit of the change we want to bring about for our country.
Kirsty Blackman (Aberdeen North) (SNP)
I congratulate all those who have made their maiden speeches today, particularly the hon. Member for Whitehaven and Workington (Josh MacAlister), who gave an excellent speech. As with many of the maiden speeches, now I really want to visit his constituency. It just sounds like an absolutely amazing place. I particularly congratulate all the new Members who have come from a council background. Being a local councillor sets them up fantastically for coming here. It means they are under no illusions about the hard work that is required to be put in for their constituents and the people who live in their area. Congratulations to all of them.
I also congratulate the Chancellor on being the first female Chancellor. As the first woman in this place ever to lead on the economy, although I have been followed by a number since, I am incredibly glad to see one on the Government Benches. I hope that, as she said, her tenure lasts significantly longer than those of some of the Chancellors we have seen in recent times.
Today’s debate is taglined “Economy, welfare and public services”. Apart from the maiden speeches, speeches focusing on anything other than economic growth have been fairly few and far between. I will not for one second deny that economic growth is important, but the whole point of it is what we then do with it. It is about what we do with the extra tax take generated from the growth we have created. There is no point in having growth for growth’s sake. There is no point in having economic growth, and no point in the Conservatives saying how fast the UK is growing compared with other countries in the G7, if the same handful of people are getting richer and richer and the vast majority of our constituents are struggling harder than they ever have before.
We need to ensure that the economic growth and the increase in the tax take that the Labour party is hoping to deliver involves a benefit for all those who live in these islands and in our constituencies. It is massively disappointing to hear that the five pledges and priorities for the Labour party in government do not have eradicating child poverty at the heart of them. I am really glad the Government are bringing together a discussion taskforce to reduce child poverty, but today they could bring 300,000 children out of poverty and move 700,000 children into less deep poverty simply by scrapping the two-child cap.
One of my previous colleagues in this place, Alison Thewliss, campaigned incredibly hard on the rape clause—everybody will know of the work she did on that. There are 3,000 women across these islands who are eligible for an exemption from the cap because they have applied under the rape clause. They have had to tell the Government they were raped in order to get an uplift in their benefits. That is horrific, and even if the Government are unwilling to move on the two-child cap they should be doing something about the rape clause and what people are having to prove in order to get the exemption.
It would be very easy to increase growth, again overnight, by increasing migration. Migration to these islands increases the amount of growth. The economy would immediately have grown if the Prime Minister had gone to the summit with the EU leaders this week and said “Yes, free movement benefits us: it benefits our economy, benefits our society, benefits our young people, benefits our musicians, and benefits so many different groups and individuals. It benefits our culture; it makes this place a better place to live. Therefore we are signing up again to free movement.”
We need only look at some of the past Budgets, such as a Budget George Osborne gave from the Dispatch Box, when it has said in the Red Book that increasing migration will increase the tax take because of the economic growth it will bring. My constituents and people across Scotland recognise that, and we will always argue for a better migration policy—and if the Government are not willing to do it for all of these islands, we will argue for one tailored specifically to Scotland so that we can make our own decisions that suit the needs of our communities and encourage that economic growth.
Mohammad Yasin (Bedford) (Lab)
It is a pleasure to speak in support of the King’s Speech under a Government committed to putting country before party to improve lives in this country. That is what I pledged to the people of Bedford and Kempston, whom I thank for putting their faith in me again to work hard for them and to restore their faith in politics as a force for positive change.
The last Government reduced our public services to a shadow of their former selves. In 2019 a study jointly funded by Bedford borough council and the NHS found that Bedford borough was 40% under-provided for in the primary care estate, despite a rapid growth in population since 2011. HMP Bedford has been in and out of special measures, so I am pleased that the Government have already taken action to improve the crisis in prisons.
I am also pleased to see early priority given to strengthening community policing by increase numbers of officers and giving them greater power to deal with the antisocial behaviour that blights our communities. I hope this Government succeed where the last Government failed in implementing a fairer funding formula for Bedfordshire police. Wrongly funded as a rural force, it is one of the lowest-funded forces in the UK despite a £10 million year-on-year increase to £156 million for 2024-25.
The housing crisis is causing untold misery to many of my constituents, so I am pleased that building houses will be a priority for our Government. It is indefensible that I know of parents who are beginning the summer holidays living in hotel rooms without access even to a fridge or a microwave to prepare food for their children because no suitable social housing properties are available. Even food bank vouchers are not helping when basic staples such as UHT milk cannot be kept fresh once opened.
More than 15,000 children and 17,000 adults are on waiting lists for mental health treatment in the area covered by the NHS Bedfordshire, Luton and Milton Keynes integrated care board. For years the NHS provider has had the capital funds to bring in desperately needed in-patient mental health facilities, but the previous Government consistently refused to provide the capital expenditure cover so that we could have those facilities in Bedford. I hope the new Government’s plan to get the NHS back on its feet includes an overhaul of how new projects are funded, because the existing capital departmental expenditure limits are not working.
Many of my constituents will be very happy to see planned legislation to bring rail back into public ownership and to reform bus services and franchises, including by allowing local control and supporting public ownership, but one of the most significant transport issues in my constituency is East West Rail. Bedford is uniquely adversely impacted by the East West Rail project, because the preferred six-track route requires the demolition and blighting of homes. Residents have been in limbo for more than five years in unsellable homes. The proposed planning and infrastructure Bill will speed up planning decisions for major infrastructure and house building and seek to reform compulsory purchase compensation rules to ensure that the compensation paid to landowners is fair. The statutory consultation stage is imminent, and I hope the Government will listen to the concerns expressed by my constituents and will not leave people in limbo while decisions are made without their knowledge, as has happened before. If we want to restore faith in politics, we have to ensure that our communities come with us on plans to affect their lives.
The Universal Studios plan to build a park near Kempston is exciting, and I look forward to working with the Government to make sure we get this potentially huge investment opportunity for Bedford and Britain over the line.
Saqib Bhatti (Meriden and Solihull East) (Con)
I start by wishing His Majesty the very best of health on behalf of myself and my constituents. As we welcome many new Members to the House, His Majesty sets a clear standard for public service that we can all hope to emulate. I have had the privilege of listening to a number of maiden speeches from across the House—all fantastic, all unique. I am sure all new Members will have received countless pieces of advice, so I will just say this: none of us, new or returning Members, should ever forget what a privilege it is to serve in this House and in this Parliament, the mother of all Parliaments.
We on the Conservative Benches have much to be proud of in the legacy of the last 14 years. Just last week we have seen inflation remain at the Bank of England target rate of 2%. We created more than 800 jobs a day for the last 14 years. It was under the Conservative Government that, in 2023, the UK became the third most valuable tech economy in the world, worth $1 trillion. We also boast more billion-pound companies than France, Germany and Sweden combined. As has been repeatedly mentioned, we have the fastest-growing economy in the G7.
I want to address the notion that the Government are trying to push, where they talk down the economy, paving the way for tax rises. It clearly does not stack up. If the Chancellor insists on pushing this alternative narrative, as we have heard today, some questions need answering, because surely all those promises made during the election cannot have been made by the Chancellor, or the shadow Chancellor as she was then, flying blind, especially when the OBR provides the transparency that she now denies she had.
Throughout the campaign, we heard about how the Government’s policies were fully funded. If the Chancellor did not use the OBR forecasts, what was she using to make those promises in the first place? I do not think anyone is fooled by this narrative or these tactics. Most importantly, if they are going to raise taxes, which will they raise? They need to come clean about that, because the British people deserve the truth, not whatever the Government are trying to peddle to justify their tax and spend policies. The Government can be assured that the Opposition will do our duty and hold this Government to account.
I want to address a number of things in the King’s Speech. I have to say I was astonished by the lack of respect in the King’s Speech to rural communities. A lot of my communities in my rural area felt incredibly disrespected, and it was incredibly disappointing. I am also disappointed and deeply concerned by the Government’s focus on building on the green belt. We have some of the most precious green belt land in Meriden and Solihull East, not least the Meriden gap, which is a hugely important throughway for migrating wildlife. It is not clear how the Government will protect the Meriden gap.
In fact, the only thing that has been clear in the early days of this Government is that they are willing to set aside local community opinions, and anyone who challenges that will be accused of being a nimby. My villages in Balsall Common, Hampton in Arden, Marston Green, Knowle, Dorridge, Chadwick End and Hockley Heath have already made huge sacrifices when it comes to green-belt land, not least because of HS2. These top-down targets and vague references to grey-belt land are already causing huge anxiety. This matters because when it comes to setting aside community opinion and disenfranchising whole communities, the tactics that the Government are already employing are the best way to do it. I am deeply concerned by that. We on the Opposition Benches will ensure that we hold this Government to account.
The title of this debate includes public services, and one of my key campaign pledges was to restore A&E services to the borough of Solihull. My argument on that is simple: we have about 220,000 people in the borough, and if there is an emergency, my constituents have to go all the way to Heartlands hospital or Warwick hospital, which are way too far away. It is clear to me that the case is strong. One thing I will be campaigning for in this Parliament, whether it takes five or 10 or 15 years, if I am lucky enough to be returned repeatedly—I make no assumptions on that, of course—will be to get that A&E service. I will be working with the integrated care board to achieve that.
I will finish on this: my constituents and the British people have been clear. As we discharge our duties as His Majesty’s official Opposition, their expectations are that we do so with integrity and humility, but always with courage and boldness in what we stand for and who we are. I assure my constituents that for the sake of our country we shall not falter.
Mr Deputy Speaker (Sir Edward Leigh)
I call Kate Dearden to make her maiden speech.
Kate Dearden (Halifax) (Lab/Co-op)
Mr Deputy Speaker, thank you for allowing me to make my first contribution to this House. I thank the hon. Member for Meriden and Solihull East (Saqib Bhatti) for his contribution to the debate.
Today’s debate is a crucial one for how we rebuild our economy in a way that works for all. I am delighted to be joining my many, many excellent new Labour colleagues in making their brilliant maiden speeches. I am also delighted to follow the incredible Holly Lynch. [Hon. Members: “Hear, hear.”] Holly dedicated her talent and energy to supporting her constituents. She was a casework champion who still found time to push for protections for our emergency service workers and for global causes, such as Fairtrade. Holly’s commitment was second to none, and I will do my best to follow in her footsteps.
In succeeding Holly, I am proud to take my place in one of Parliament’s great traditions: the Labour women of Halifax. Since the election of Shirley Summerskill in 1964, there have only been four years where Halifax has not been represented by a Labour woman. I am lucky to have the support of brilliant women, from the Labour Women’s Network to trade union colleagues and my late teacher Elaine Barker who set me on the road to this House. I am standing on the shoulders of my sisters, and I will not let them down.
Halifax is a town bursting with history. It was a centre of the wool trade and textile manufacturing, with the Piece Hall the most beautiful and well-known testament to our heritage, but there is far more to the history of Halifax than that. We have a magnificent minster, the imposing Wainhouse Tower, and Shibden Hall, home of lesbian diarist Anne Lister. Halifax’s industrial heritage has meant a close connection to socialist movements. It was a stronghold for Chartists, a centre of trade union activism and the birthplace of Halifax building society, and it has a legacy of co-operative movements. As a trade unionist and now a Labour and Co-operative Member of Parliament, it is a history I am proud to celebrate, and celebrating our history has become a big part of Halifax’s future.
The Piece Hall is now one of the UK’s best music venues. This summer it is hosting Idles, Tom Jones and the Ministry of Sound, and I will leave it to hon. Members to guess who I would prefer to see. We have reimagined the beating industrial heart of Halifax at Dean Clough mill as a centre for arts, culture, food and shopping. That, combined with the beautiful nature of the Calder valley, has seen Halifax transforming into Haliwood. Many in this Chamber will have seen “Happy Valley”, but there is also “Gentleman Jack” and “Last Tango in Halifax”, and we even hosted Marvel for its “Secret Invasion”. As a Member of Parliament for Halifax, I will lobby for any future editions of “Charlie and the Chocolate Factory” to come and celebrate the home of toffee, Rolos and Quality Street.
There are so many other things that make Halifax a unique and special town, from our fabulous independent department store Harveys—where I bought today’s lovely dress—to Eureka! the museum where I and every other former schoolkid in the north of England went on school trips, and, of course, the famous Shay, home to Halifax Town and Halifax Panthers.
I must also mention some of the challenges that my town still faces. Like most of the ex-industrial UK, we have faced decades of neglect and under-investment. Halifax endures significant deprivation, with above-average levels of unemployment and child poverty. Access to housing is a problem, especially for young people, and the availability of GPs came up time and time again on the doorstep. The people of Halifax have struggled for too long with the cost of living crisis, low wages and poor public services. That has been the story of my town and of our country.
As anyone who knows Yorkshire will guess, the people of Halifax have done much to help each other. Halifax is the home of Andy’s Man Club, which many Members will know from its essential work to support men’s mental health. I met its volunteers as well as those of Healthy Minds, which is another great charity helping tackle mental illness. Noah’s Ark debt centre offers crucial financial support, and the Holy Nativity church in Mixenden is one of several organisations running a food bank and a pay-what-you-can café. Daisy Chain café provides a haven for the elderly to meet and socialise, and St Augustine’s Centre gives much needed support to refugees.
Those brilliant community initiatives have done their best to help those who have been struggling in recent years, and they have achieved much. However, we know that the buck stops with us and that we must address the issues facing our nation and prove that things can get better. These issues, when not addressed, lead to suffering, despair and anger. We on the Labour Benches can celebrate our success at the election, but a victory for our party is only ever a means to an end. Our goal now is to bring about the change that we promised.
I am proud to be delivering my maiden speech in this debate, where we set the agenda for what we will do to improve the lives of everyone across the country. Part of this is close to my own heart: the new deal for working people. In my previous role at the brilliant Community trade union, I was proud to be part of drafting those aims alongside trade union colleagues. The agenda on extending workers’ rights, including for those who are self-employed or part of the gig economy, is one that I want to champion over the next five years.
I would like to end with a few thank yous. First, I thank all the people I have mentioned so far, who make Halifax the wonderful town that it is, for everything they do. Secondly, to the incredible activists of Halifax—the Labour team in our town should be the envy of constituency Labour parties nationwide—I could not be more grateful. As every Member in this House knows, we are here because of those around us—the family, friends and colleagues who support us—so I want to thank my wonderful friends, my mum, my dad, my sister, and my partner Brad. Finally, I thank the people of Halifax for trusting me. I will fight every day to achieve everything that I can for them and reward the faith that they have shown in me.
Mr Deputy Speaker (Sir Edward Leigh)
I call Ben Obese-Jecty to make his maiden speech.
Ben Obese-Jecty (Huntingdon) (Con)
Mr Deputy Speaker, I am grateful to you for calling me to make my maiden speech during this King’s Speech debate on the economy, welfare and public services. I congratulate the hon. Member for Halifax (Kate Dearden) on her maiden speech. As a former officer in the Duke of Wellington’s Regiment, her constituency has deep links with my former regiment, and indeed its antecedent regiments, the 33rd and 76th of Foot.
It is fantastic to hear new Members on both sides of the House speak so passionately and eloquently about their constituencies. I speak as the first new Member of Parliament for Huntingdon since 2001, but I am only the third Member in my lifetime, and the fourth Member since the second world war. It is therefore an enormous privilege to have been elected to represent the constituency, and I am honoured to have been voted for by my constituents to follow such a long-serving Member of Parliament. My predecessor Jonathan Djanogly served the House and his constituents for some 23 years. In Parliament he served on the Trade and Industry Committee, as Solicitor General and as a shadow Business Minister. In government, he was the Parliamentary Under-Secretary of State at the Ministry of Justice.
My predecessor’s proudest achievements came from the work that he delivered locally. His work on tackling flooding from the River Great Ouse saw significant flood alleviation projects delivered in St Ives and the Hemingfords, and further upstream in Godmanchester. That work has saved thousands from the crippling impact of flood damage on homes and businesses. I intend to build on that, delivering further flooding solutions across the constituency for villages such as Alconbury, Abbots Ripton, Wistow, Kimbolton, Broughton and Earith.
My predecessor is also rightly proud of his work in facilitating the delivery of both the A14 and the A428—road infrastructure projects that have transformed travel across Cambridgeshire, and stand to greatly enhance the region in its position at the tip of the UK innovation corridor. The development has set the conditions for Huntingdon’s future growth, offering the opportunity for better jobs and taking advantage of the Cambridge cluster and expansion across the region, meaning that Huntingdon can be a business hub in its own right, not just a dormitory town for London and Cambridge.
Despite the growth that Huntingdon has seen over the past 60 years, first via the post-war London overspill and now via expansive development, the constituency is still characterised by its thriving towns and vibrant villages. From the market towns of Huntingdon and St Ives to our rural villages, from Sawtry to Somersham, Houghton to Hamerton, Covington to Colne and Pidley to Perry—and three dozen others that will not stretch to my tortured alliteration—each has their own character and identity. Huntingdonshire is a region with a rich history, and one that it will be a privilege to steward.
That history extends to some of my other predecessors. Many Members will be aware that Huntingdon is the seat of a former Prime Minister, Sir John Major, who is still held in the highest regard across the constituency. It was an honour to receive his endorsement during the recent election campaign. Famously, it is also the former seat of the Lord Protector, Oliver Cromwell. Cromwell was the Member of Parliament for Huntingdon in 1628 for just over a year until Charles I dissolved Parliament. Records show that he made just one speech in that time—so far, so equal.
It is clear that Huntingdon expects a certain level of stature from its Members of Parliament. Notable as Sir John Major and Oliver Cromwell surely are, arguably they are not Huntingdon’s most famous product. It is not even the celebrated diarist Samuel Pepys, who attended Huntingdon Grammar School. In fact, that accolade should be awarded to a lunch-time staple that everyone is familiar with; one that everyone has a favourite version of; and one that some Members may well have had for lunch this very day.
John Montagu, three times First Lord of the Admiralty, Postmaster General and Secretary of State, is not notable for his political career or his colourful social life. John Montagu, whose family home was Hinchingbrooke House in Huntingdon, is best known today—somewhat arcanely—by his title and the moniker bestowed upon his favourite snack to consume during long sessions at the card table. Such was the popularity of said snack that other card players also wished to order it. They would cry, “I’ll have the same as Sandwich.” It obvious where this is going. John Montagu, the 4th Earl of Sandwich, was not prepared to break from the card table to eat, so would ask his servants to bring him slices of salted beef between two pieces of toasted bread. Yes, among its formidable political alumni, Huntingdon can also lay claim to a genuine global culinary revolution, described by The Wall Street Journal no less as Britain’s “biggest contribution to gastronomy”. Huntingdon is the birthplace of the modern sandwich—every day is a school day.
I digress. Huntingdon’s rich history is also characterised by an inextricable link to service via its long relationship with military aviation, initially through the Royal Flying Corps and subsequently during the second world war through RAF Bomber Command’s Pathfinder force and the United States army air force’s 303rd bombardment group. On 4 July 1942, the US eighth air force flew the first American mission over Nazi-occupied Europe from RAF Molesworth.
Latterly, during the cold war, RAF Alconbury saw the US air force provide covert high-altitude reconnaissance along the East German border in a new variant of its famed U-2 spy plane, in addition to providing battlefield damage assessment in the event of a nuclear strike. Most of that base is now Huntingdon’s newest housing estate, Alconbury Weald—surely the only housing development in the country with fully functional nuclear decontamination and washdown facilities. RAF Warboys, RAF Upwood and RAF Brampton have all since disappeared, but the constituency still retains those links. RAF Alconbury and RAF Molesworth are still operated by the United States air force, and RAF Wyton is on the cutting edge of our defence intelligence capability. Those links carry through into the constituency itself and it is striking just how many veterans have made their home within its boundaries. One in nine households within Huntingdon are home to a veteran, a staggering number when compared with other constituencies and a community that, as a British Army veteran myself, I am proud to represent as their Member of Parliament—even if to many of those RAF veterans I am just a Pongo.
I know well how important it is to support our veterans’ community and to commit to improving veterans’ welfare. Having undergone the process myself, the transition from service to civilian life has its challenges, and there are many stories of both success and failure. I served on a veterans advisory and pensions committee and know well how important it is to ensure that veterans are able to access the services they need. Veterans’ identity cards have helped to open those pathways for many who would otherwise struggle to evidence their service, but I hope the Government will look closely at how support itself is provided. Restructuring Veterans UK and creating a more comprehensive holistic offering, easing access via an overhauled veterans gateway, could streamline access to the welfare services that our veterans need.
While the cohort of veterans in this House is smaller than in the previous Parliament, it is now younger and sports Members on both sides who have more recent operational experience and, crucially, more recent experience of the often difficult post-military transition to a civilian life. Parliament is well-placed to champion veterans’ welfare and, given the debt our democracy owes to those who have served so proudly, I hope we can collectively ensure that the finest armed forces in the world are treated here as the finest veterans in the world. I know Huntingdon’s veterans will expect me to challenge the Government to meet that standard.
I am hugely proud of having been given this opportunity to serve Huntingdon, to be its champion both in Parliament and in the constituency. I look forward to meeting the challenges ahead.
Nadia Whittome (Nottingham East) (Lab)
I congratulate the hon. Member for Huntingdon (Ben Obese-Jecty) on a fantastic maiden speech and in particular the passion with which he talks about veterans and the need for more support for veterans.
I start by thanking the people of Nottingham East for electing me once again to represent them in Parliament. It remains the honour of my life to represent my home city. I also pay tribute to my hon. Friend the Member for Nottingham South (Lilian Greenwood), who is a formidable champion for our city. She will be missed by the residents of Castle ward, which is now in my constituency following the boundary review.
What a contrast between this King’s Speech and the last. For the first time in 14 years we have a set of policies that prioritise people’s rights and wellbeing: policies that draw on the rich history of the Labour movement; policies to help protect the right to strike, to enhance the right to flexible working, and to end fire and rehire. We also have policies that echo some of the great achievements of previous Labour Governments, which recognise the value of owning and running services and infrastructure for the common good.
The failure of previous Conservative Governments to combat the climate crisis should terrify us all. We have so much catching up to do if we are to avert the chaos it threatens, so I welcome our Government’s plans to speed up the transition to renewables through a publicly owned clean energy company. And with a Bill to bring rail services back into public ownership, I hope to see far less regularly those chilling words: “rail replacement bus service”.
I am also relieved to see the return of some policies that successive Conservative Governments promised but never delivered: a Bill that will end no-fault evictions and improve renters’ rights; and another that will ban so-called conversion “therapy” once and for all. I have heard from survivors the horrific impact these hate-fuelled conversion practices have had on their lives. To finally end them, it is right that such a Bill is trans-inclusive and it must be loophole-free. It is time to challenge the confected moral panic that is harming LGBTQ+ people, in particular the trans community. This is not the 1980s and we are not going back there. Instead of pitting trans rights against women’s rights, our Government have an opportunity to demonstrate what improving women’s safety actually looks like through delivering on our promise to halve violence against women and girls. The constant harassment on our streets and the hidden abuse in our homes is what we need to prevent, not trans people using the bathroom they feel most comfortable in.
The Conservative party has made our society poorer, more unequal and more authoritarian. From the 4.3 million children forced to live in poverty—more than one in three in Nottingham East—to the destruction of our public services and the damage to our democratic system, our country is in crisis. The laws that allowed these things to happen in the first place belong in the dustbin of history. We should start by scrapping the two-child benefit cap, which would immediately lift 300,000 children out of poverty.
This election delivered a historic victory for our party. Our regular meetings of east midlands Labour MPs used to be quite lonely affairs; well, they are not any more! I welcome my new hon. Friends to their places—their victories are justly deserved—but this was also a historic election for other reasons that we cannot afford to overlook. Disillusionment with politics is providing fertile ground for those who wish to divide us, and if we are to keep the far right from gaining further ground, status quo politics will not be enough. Tweaks to a failed neoliberal economic system will not deliver the improvements in living standards that people need, nor will they prepare us for the challenges of the future. With a historic victory, we have a historic responsibility to redistribute wealth and power into people’s hands so that they feel the difference a Labour Government can make. The measures in the King’s Speech are important first steps in that direction, but let us turn them into bold strides in the coming months and years.
I could not finish my first speech in the new Parliament without highlighting the unbearable situation in Gaza. Palestinians need a ceasefire now; indeed, they needed one nine months ago. I welcome the shift in my party’s position over recent months, and I welcome the restoration of funding to the United Nations Relief and Works Agency, but when British weapons are continuing to be used in contravention of international law—
Sarah Dyke (Glastonbury and Somerton) (LD)
It is an honour to return to the House and to represent residents of this new constituency.
Constituents tell me that the issues that matter to them most are health and social care, rural affairs, housing and local services. About 2.5 million people are out of work with long-term sickness, so the challenge for this Government is to fix the health and care crisis, because a healthy economy requires a healthy NHS. This new Parliament presents an opportunity to work collaboratively to fix many of the issues plaguing my constituents.
There is a dental provision cavity in Somerset. There are no dentists in Glastonbury and Somerton taking on new NHS patients. One practice in Street has not had an NHS dentist in post for 18 months, although the job has been advertised continuously. I am sure that all Members have heard many heartbreaking stories from people suffering in dental agony. I recently spoke to Ian from Langport, who told me that he was unable to access the crucial NHS healthcare that he needs. His only option is private dental treatment, which will cost him more than £3,000. For Ian and for so many others, this is simply unaffordable. It is no wonder that residents are left open-mouthed when they hear that £8 million was underspent on NHS dentistry in Somerset last year alone. NHS dental contacts need reform urgently, and the recruitment crisis must be unblocked.
People are also waiting longer to see a GP. Last year the number of four-week waits rose by 49% in Somerset. The number of GPs must increase in order to guarantee patients the right to see a GP within a week, or within 24 hours if the situation is urgent. By improving local frontline services, we will reduce pressure on our hospitals. I was delighted to visit a rural health hub during the last Parliament, and I call on the Government to maintain support for such hubs because they have proved that they offer flexible and accessible healthcare provision for our rural and farming communities.
This week is Farm Safety Week, and it marks the 10th anniversary of the Farm Safety Foundation, an organisation that I am proud to work alongside to highlight the key challenges faced by farmers and farm workers every day. People working in agriculture are 21 times as likely to be injured at work compared with the national average, while 95% of farmers under 40 agreed that poor mental health was the biggest problem facing the industry today. The agricultural sector is crucial to the rural economy, and farming is vital to UK food security, but inflationary pressures continue to damage farm businesses, and the mismanaged transition from the basic payment scheme to environmental land management schemes is forcing many farmers out of business.
Food security also requires fair access to international markets, but the last Government’s botched trade deals damaged that. Those deals undermine our nation’s health and our environmental and animal welfare standards, and they must urgently be renegotiated. To protect the rural economy, there needs to be fairness in the food chain, and the groceries code adjudicator needs more teeth. That would support our farmers and protect consumers from unfair price rises.
Glastonbury and Somerton is home to some of the lowest-lying land in the country, so a serious commitment to food security requires a robust approach to flood management. Of course, agricultural land will always play a vital role in preventing flood damage to urban areas, but this cannot be at the expense of agricultural businesses, which need to be properly compensated for the sacrifices they make. Ensuring that water is managed correctly also means managing the nutrient load of rivers and lakes. We require legislation to ensure that nutrients enrich and improve our soils, rather than being leeched away into our rivers, which adds to the pollution crisis.
Making such reforms would unlock the 18,000 homes in Somerset that already have planning permission and are currently waiting to be built. The new Government have pledged to make that possible, and I welcome the new Secretary of State for Housing’s recent commitments on this issue. I eagerly wait to hear the Government’s plans, because there is a serious shortage of homes and a solution is desperately needed. However, I am clear that homes must be built in the right places and to the best possible environmental standards, and they must be delivered with the infrastructure that communities so desperately need. After years of an out-of-touch Conservative Government taking us all for granted, I am looking forward to having the opportunity to work together to deliver the ambitious changes we desperately need.
Lizzi Collinge (Morecambe and Lunesdale) (Lab)
Thank you, Mr Deputy Speaker. I have been preceded by many wonderful first speeches, particularly from the hon. Member for Huntingdon (Ben Obese-Jecty) and my fellow Cumbrian representative, my hon. Friend the Member for Whitehaven and Workington (Josh MacAlister), to whom I say, “Areet, marra?”
I would like to start my first speech by paying tribute to my predecessor, David Morris. I know he knocked on a lot of Ministers’ doors to get funding for Eden Project Morecambe, and I thank him for it. I made a solemn promise to him that I would deliver Eden Project Morecambe and make it work for local people.
Thanks to boundary changes, I have two other predecessors. Morecambe and Lunesdale has gained a tract of beautiful Westmorland that was formerly represented by the hon. Member for Westmorland and Lonsdale (Tim Farron). I know from speaking to his former constituents that the hon. Member is highly regarded and leaves some big boots to fill.
I also gained Lower Lune Valley ward from my good friend and mentor, my hon. Friend the Member for Lancaster and Wyre (Cat Smith). When I joined the Labour party in 2014 after the birth of my first child, my hon. Friend invited me for a brew. I thought this was a very kind gesture. Little did I know what she had in store for me. I hope she now feels that the aching arms she got from my particularly enormous newborn were well worth it. I would also like to pay tribute to the Labour Women’s Network and the 50:50 Parliament campaign for their tireless work and collective efforts to see more women Members elected.
I would be remiss if I did not mention my predecessor, Geraldine Smith, who is extremely well regarded in the constituency. And what a constituency it is. Morecambe and Lunesdale is definitely the most beautiful constituency in the country. From the golden sands of Middleton, through the beautiful art deco buildings and stunning sunsets of Morecambe, up the lush Lune Valley, across the Arnside and Silverdale national landscape, and into the wild beauty of Westmorland, you would be hard pushed to find a better place to live or work. My constituency has a diverse set of towns and villages, all with their own needs and fantastically strong communities. Their differences should be respected and celebrated. Where their needs overlap, often the solutions need to be tailored to their specific circumstances. In constituencies such as Morecambe and Lunesdale, one size does not fit all, so as our new Government deliver their ambitious programme of national renewal, I will ensure that the voices of all my communities are heard.
My aim is to be a good constituency MP. For me, there is no more honourable ambition, and I am extremely grateful to all the people who supported me and enabled me to have that honour. In His Majesty’s most Gracious Speech, we heard about the Government’s plan to reform our bus system, and as a proud member of the Lancaster District Bus Users Group, I welcome that warmly. I also warmly welcome the new Government’s dedication to farming and rural communities. In his contribution in this place last week, the Secretary of State set out a new deal for farmers, action on water pollution and plans to tackle the nature emergency. Speaking of nature, in Morecambe the shrimps are not only part of the local fauna, and a local delicacy that comes highly recommended, but the local football team, and I look forward to delivering on my promise to them of a new independent football regulator.
Before joining this Chamber, I served as a Lancashire county councillor for eight years, and in that time I have specialised in health and social care and served on our health scrutiny committee. I am sure that Members across the Chamber will agree that we expect the highest standards of care for our constituents, so I pay tribute to the many patients and health campaigners who have worked so hard to ensure safe, equitable care for all. Many a health and care leader in Lancashire and South Cumbria has met me across a committee table. I hope that they found me a fair, if sometimes firm, scrutineer.
I am a humanist. Humanists are people who shape our lives in the here and now, because we believe it is the only life we have, and what is politics if not shaping lives in the here and now? Humanists try to treat everyone we come across with warmth, understanding and respect. We believe that we humans have everything we need: logic, reason, evidence, and empathy to make good, ethical decisions. It is these values that I hope to bring to my role in decision making in this place, so I welcome our Government’s focus on service, integrity and honesty. If we are to rebuild trust in politics, we must adhere to those principles rigorously, and I am sure that Members across the Chamber will do so.
Finally, I dedicate this speech to my family: my mum and dad, who brought me and my sister Hannah up with good morals and lots of love; my husband Miles for always having my back and taking on an unfair share of the family duties, alongside a full-time role with the NHS; my kids for putting up with mummy being away so often; and my grandma and grandad, who we lost in 2022. Grandma, remembering her parents’ hard upbringing—they experienced sometimes abject poverty—always voted Labour, much to the annoyance of my working-class Tory grandad. When I was first elected to the county council, grandad told me, “Ey Liz, I’m reyt proud of you. It’s a pity you’re on the wrong side!” My grandad might not have been a Labour supporter, but he did believe in service, and I look forward to working with Members across the House to serve our country and my people in Morecambe and Lunesdale.
Alex Easton (North Down) (Ind)
Thank you, Mr Deputy Speaker. I want to say well done to the hon. Member for Morecambe and Lunesdale (Lizzi Collinge) for her maiden speech. Congratulations! I rise today to express my heartfelt gratitude to the electorate of North Down for the tremendous privilege of electing me to represent them in the House of Commons. I am so humbled and privileged, and I pledge before God to serve them to the best of my ability. I will always put you first. I would like to express my sincere appreciation for the work of my predecessor, Dr Stephen Farry. I wish him every success in his future endeavours.
I am a proud Ulsterman, and anyone who knows Ulstermen and Ulsterwomen will know that we are very generous and love to meet new people, so I would like to take this opportunity to invite everyone to visit North Down. It is the best part of the United Kingdom to live, work and invest in. Our stunning coastline features the beautiful city of Bangor and Crawfordsburn country park, alongside historical sites such as Bangor abbey and Grey Point fort. North Down is also home to exceptional golf courses, including the Holywood golf club, where the brilliant Rory McIlroy honed his skills from the age of seven. With excellent road and rail access to Belfast, North Down offers a perfect blend of natural beauty and modern amenities. Please come and visit; you will be welcome. Maybe not all at once, though.
I would like to extend a warm welcome to the distinguished right hon. Member for Leeds South (Hilary Benn) in his new role as Secretary of State for Northern Ireland. I wish him every success.
I fully support the plans laid out in the King’s Speech that aim to deliver economic prosperity and kick-start growth. The partnership approach with the Northern Ireland Assembly is particularly welcome, and I am encouraged by the figures from His Majesty’s Revenue and Customs showing that Northern Ireland has recorded the fastest year-on-year job growth for the second consecutive month, significantly outperforming other parts of the United Kingdom. Furthermore, I am encouraged to note that median monthly wage growth in Northern Ireland is outpacing that in other parts of the United Kingdom, positioning us fifth among the 12 UK regions. It is imperative that we build on this economic success and translate it into improved quality of life and regeneration in North Down.
We must also be mindful of the fact that most of Northern Ireland’s trade is across the vital east-west axis with Great Britain, alongside the important, albeit lesser, north-south corridor with the Republic of Ireland. According to the Northern Ireland Statistics and Research Agency, sales and exports along the east-west corridor between Great Britain and Northern Ireland were valued at £12.8 billion in 2021. In comparison, sales and exports between Northern Ireland and the Republic of Ireland totalled just £5.2 billion. This highlights why the Union of Great Britain and Northern Ireland is invaluable and should be cherished, as it enhances economic quality of life for all our people and communities across Northern Ireland.
We can look to our Ulster Scots heritage in Donaghadee and Millisle as prime examples of outstanding development, spearheaded in the early 17th century by two distinguished figures: Sir James Hamilton, first Viscount Claneboye, and Sir Hugh Montgomery, first Viscount Montgomery. Their legacy should serve as inspiration for the ongoing economic development of Donaghadee and North Down, particularly in areas of industry and infrastructure.
However, not all is well in my constituency. The Queen’s Parade project in Bangor has seen Queen’s Parade lying derelict for decades. Our minor injuries unit has been closed, and we have no open police station inquiry offices—I bet no one else in this Chamber has no open police station inquiry offices in their constituency.
People in my constituency cannot see their GP, the roads are full of potholes and there is a lack of social housing and new starter homes for young families who want to start on the housing ladder. I really hope that this Government will help to improve my constituents’ lives.
It is essential to note that the Northern Ireland protocol is fundamentally flawed. It creates a de facto border in the Irish sea, undermining the integrity of the UK by separating Northern Ireland from the rest of the UK. This arrangement has led to increased bureaucracy, hurdles and trade barriers, disrupting economic stability and supply chains. Furthermore, it has caused political and social tensions in Northern Ireland, raising legitimate concerns among Unionists about their place in the United Kingdom. I contend that by prioritising the EU’s regulatory framework over the wishes of the people of Northern Ireland to be a full part of the UK, the protocol disregards democratic principles and subjects us to foreign laws. It needs to be changed. It needs to go.
Finally, I want to mention my parents. My mum and dad were killed in a fire at their home in Bangor last year, and it caused a lot of heartache for me. I want to say that my dad believed in me. After four attempts to get to Westminster, I finally succeeded. Dad, I hope I made you proud.
When you have everything taken away from you like that, it makes you realise just how important your family are. It makes you see everything that you have taken for granted throughout your life, such as the health service, which has always been there for us. I appreciate the people in the health service and the Police Service of Northern Ireland who tried to help my mum and dad—I so much appreciate you. I also pay tribute to the Northern Ireland Fire Service, who did everything in their power to help my mum and dad. I just want to let you know that I appreciate everything you have done for my family. I mean that from the bottom of my heart.
Several hon. Members rose—
Mr Deputy Speaker (Sir Edward Leigh)
Order. It is my intention to start the wind-ups at around 9.30 pm.
Chris Webb (Blackpool South) (Lab)
I speak for the whole House when I say to the hon. Member for North Down (Alex Easton) that I know his father would definitely be proud of him today, and of the work that he will go on to do in the House. He should take that with him in every step in this place. His parents would be, and are, proud of him. I congratulate him on his maiden speech.
I thank my constituents in Blackpool South for re-electing me as their Member of Parliament for the second time in as many months. It feels a lot nicer speaking from the Government Benches than from the Opposition Benches. Hopefully I will do my constituents proud. The legislation announced last week is important to my constituents, who, after 14 years of Tory rule, live in the second most deprived constituency in the UK. They have been deprived of opportunities, decent healthcare, quality housing and safety. I am grateful for the opportunity to speak about some of those issues on their behalf today.
Many colleagues in this House will have visited my constituency at some point in their life, perhaps for a party conference, a childhood holiday or a cheeky weekend away. Blackpool is not a place people pass through, and the chaos of the railways under the last Government has left us abandoned at the end of the line. I am relieved that this Government plan to bring our railways back into public ownership. A reliable and affordable service will allow my constituents to access better opportunities.
The King’s Speech gives the rest of the House the opportunity to recognise Lancashire’s potential for growth. Like our Greater Manchester, Merseyside and West Yorkshire neighbours, Lancashire would benefit greatly from a devolution deal, and an elected metro mayor who has powers over transport, roads, urban regeneration, skills and housing. I will work alongside my fellow Lancashire Members in this House and council leaders to secure the best devolution possible for our county.
This morning, the Environment Agency issued a pollution warning across my constituency’s coastline and advised against entering our waters. This is the fifth day since my re-election that such a warning has been issued. That is unacceptable. It not only threatens tourism but my constituents’ health, wellbeing and sense of local pride. Local campaign group Fylde Coast Against Sewage deserves recognition for its hard work testing the waters of our shores. The water special measures Bill will strengthen the powers of the regulator, so that Blackpool residents can hope to once again reap the benefits of our greatest natural asset.
Though the town has served the working classes with entertainment, work in Blackpool is precarious, and often poorly paid, insecure and seasonal. The employment rights Bill, which will ban exploitative practices and enhance employment rights, will transform the lives of working people in Blackpool, just as the former Labour Government did for my family. As a fellow working-class northerner, the Deputy Prime Minister knows that she has my full support for her pioneering new deal for working people. Thousands of my constituents are set to receive a pay rise that will help lift them out of poverty.
I am pleased that legislation will be brought forward to strengthen community policing and give the police greater powers to deal with antisocial behaviour, as well as strengthen support for victims. Reclaim Blackpool Map is a grassroots project run by women in the town, highlighting the prevalence of public sexual harassment. As a white ribbon ambassador for over five years, I have been working to educate men, young people and boys in my community. I know that the new Minister for safeguarding will work tirelessly to tackle violence against women and girls, and she has my full support.
Blackpool is a place of great resilience, where people muster to fight against the odds. That was tangible in March 2019 when I joined thousands of fans returning to Bloomfield Road after the successful boycott campaign to remove the corrupt owners of Blackpool FC. Huge credit goes to Blackpool Supporters Trust, whose campaign restored integrity, pride and professionalism to the club. The football governance Bill is a step in the right direction towards returning the game to the fans who make it what it is. I cannot talk about football fans without acknowledging the 97 who will finally get justice under this Government’s Hillsborough law.
In conclusion, there will be many measures of success for this Government, but one important symbolic one will be the success of Blackpool. As a Member of Parliament, I will be fighting to ensure that the people of Blackpool South are no longer at the back of the queue.
Mr Deputy Speaker (Sir Edward Leigh)
I call Victoria Collins to make her maiden speech.
Victoria Collins (Harpenden and Berkhamsted) (LD)
Thank you, Mr Deputy Speaker, for giving me the opportunity to make my maiden speech today. I thank the hon. Member for Blackpool South (Chris Webb) for his passionate speech and join him in his comments about the hon. Member for North Down (Alex Easton), to whom I pass on my massive congratulations and say that I am sure that his father would be extremely proud of his position here and of the public service that he will give.
I stand here exactly 50 years since my mum came to the UK from Malaysia. She came here for an education and stayed to build a business and raise a family. As I helped in my mum’s shop, my parents instilled in me values of community, tolerance and perseverance—something that I hope will guide me during my time as an MP. One of my predecessors, Bim Afolami, also proudly shared his story as a child of immigrants in search of a good education. He brought the values that he learned to his role as MP for Hitchin and Harpenden.
It is a real honour to be the first MP for the brand new seat of Harpenden and Berkhamsted. More than just two towns, the constituency is a rich tapestry that fills the north-west corner of Hertfordshire with history, natural beauty, culture and innovation. We are a collection of proud and vibrant communities with four beautiful chalk streams and the Grand Union canal tying us together like silver threads. The River Bulbourne runs through Berkhamsted, where the Crown of England was surrendered to William the Conqueror in 1066, and its river course would go on to fill the three moats of Berkhamsted Castle. The River Gade starts near Little Gaddesden, which neighbours the Ashridge estate—somewhere Members may have seen in films and dramas such as “Robin Hood”, “The Crown” and, of course, “Bridget Jones’s Diary”.
Members of the House are most welcome to join me locally at the Rex cinema or peruse one of the largest film collections in the world at the British Film Institute’s national archive.
As we swoop across the constituency, the River Ver exits above ground near the village of Markyate, traversed by the Roman Watling Street, and continues through Flamstead and Redbourn. Our final chalk stream, the River Lea, flows through Harpenden and Wheathampstead, a Domesday village that has been home to two Prime Ministers.
Not only have these precious chalk streams witnessed historic events and the lives, hopes and dreams of countless local people, but, with only around 200 of them in the world, they are of rare ecological importance; they are known as England’s rainforests. Sadly, however, we have seen their decline, as sewage has been pumped into the waterways, with the River Ver, having finally recovered its flow, seeing more than 2,500 hours of sewage discharge this year alone.
The same fate goes for the Grand Union canal, where people can jump out at Tring. Although they may not be able to see zebras or cassowaries in Tring Park any more, they can visit them in our natural history museum. People in our part of Hertfordshire are proud of their natural landscapes, and I join them in campaigning to protect our environment and tackle the climate crisis.
The other side of our local communities blossomed from the industrial revolution, which brought another type of silver track—the train lines. Rumour has it that some of the original commuters are still waiting for that rail replacement bus service. Britain initially led the world in railways, but the decline of our public transport feels as if it gathers pace year on year. Bus services that are vital to our towns and rural communities have been cut by more than half in Hertfordshire in recent years, and that is not to mention the cuts to local authorities that have impacted other vital services.
We are not immune to the health and social care crisis, either, as local people struggle to get the care they need, wait weeks to see a GP or cannot find an NHS dentist. Indeed, one of my other predecessors, Mike Penning, who served Hemel Hempstead for 19 years, campaigned tirelessly on healthcare for the area. I aim to continue as a champion of ensuring that local people get the healthcare they need, and closer to home.
Local people have continued the enterprising spirit of the area, which still thrives today, from building e-bikes to distilling gin, creating start-ups and innovating in agriculture at Rothamsted Research, with its thriving agritech hub. Indeed, our greatest assets are our local people—open-minded, tolerant, hard-working and compassionate. It is for them, and thanks to them, that I am here, and I will always put them first.
Given the picture often painted of our corner of Hertfordshire, Members might think that we are solely an affluent commuter area, but that is far from the reality for everyone. So many families, individuals and local businesses are struggling to make ends meet as bills continue to rise. I remember the struggles that my family faced when the economy turned and business got tough. That is why I am passionate about supporting local families, tackling inequality, and not just the vital local businesses that we value today but the entrepreneurs and enterprises of tomorrow.
Standing here, in the most diverse Parliament that we have ever seen, we see that we have a real opportunity for change. We must act now to rebuild the trust in politicians and politics that has sadly been eroded in recent years. For me, that means putting local people first—the people of Harpenden, Berkhamsted, Tring and our villages, from Long Marston to Jersey Farm, and from Ringshall to Sandridge. Thinking back to where my story began, it is a privilege to be in this place, representing a story that so many others in our country have some share in. My mother came to this country in search of opportunity, and through her own hard work she found it. Through everything that I do here, I want to ensure that the same opportunity is available for all who seek it out, and I will continue to be guided by those values of community, tolerance and perseverance.
Mr Deputy Speaker (Sir Edward Leigh)
I call Luke Akehurst to make his maiden speech.
Luke Akehurst (North Durham) (Lab)
Thank you, Mr Deputy Speaker, for calling me to make my maiden speech. I congratulate the hon. Member for Harpenden and Berkhamsted (Victoria Collins) on a fine speech, and a very impressive description of her constituency and her motivations for coming to this place.
It has taken me some time to get elected to the House. I first stood in a general election back in 2001, so no one can accuse me of being a young man in a rush. I am humbled to finally be here, having done some other things in party politics along the way. I pay tribute to my late mum and dad, who inspired me to get involved in politics. They gave me my Labour values, and I am sorry that they just missed out on the chance to see me get here. I also thank my family for their huge support, including lots of campaigning and lots of patience, as my speech has come rather late in this debate.
I thank the electors of North Durham for voting for me to represent them in this House. I promise that I will always fight for their interests, and I could not want to represent a finer constituency. I follow into the House the right hon. Kevan Jones. He is an extremely tough act to follow, and I wish him well both in overcoming his health troubles and in his new role, having been elevated to the other place. Kevan was elected MP for North Durham in 2001, and served the constituency and this House with distinction for 23 years. He was utterly committed to the defence and security of our country, serving as a Defence Minister, with multiple stints on the Defence Committee. He was the longest-serving member of the Intelligence and Security Committee, a vice-president of the NATO Parliamentary Assembly, and a commissioner of the Commonwealth War Graves Commission. That is highly appropriate, given the number of veterans in the North Durham constituency—particularly people associated with the Durham Light Infantry.
I am sure that in the other place Kevan will continue to work on defence and other issues, such as the sub-postmasters’ campaign for justice. His continued work on the Horizon redress advisory board will give reassurance to victims. Kevan will continue to pursue an outcome for sub-postmasters who used the Capture software in the 1990s, which is currently the subject of an independent investigation that was commissioned by the Government earlier this year. Many hon. Members will know that Kevan is a keen photographer, often capturing and sharing the beauty of North Durham. Countless voters and local organisations have told me how much they have been helped by Kevan. He is held in high regard not just across this House but across North Durham.
I have been elected in a long line of Labour Members, all, as far as I can discern, from the same moderate tradition in the party that I stand in, and including distinguished Front Benchers such as Giles Radice and Jack Lawson, who served as Attlee’s Secretary of State for War in the closing days of world war two. The Chester-le-Street part of my constituency has a unique distinction in the history of the Labour party, having returned a Labour Member to the House continuously since 1906—so no pressure on me to keep winning at all. However, that long Labour history does not mean that North Durham is a safe seat. In every characteristic other than never having been lost, it is a red wall seat and has been electorally competitive in the last two contests. Indeed, this most recent election campaign was rather livelier than I would have preferred.
Chester-le-Street is only one part of North Durham under its current boundaries, however, with the other major town being Stanley. The constituency is rural—surprisingly so. Aside from the two main towns, there are numerous villages. I may get into trouble for not listing some of them, but I will try to list the major ones: Sacriston, Tantobie, Tanfield, Beamish, Bournmoor, Lumley, Pelton, Pelton Fell, Craghead, Ouston, Lanchester, Burnhope, Castleside and Annfield Plain are just some of them. I wish to thank the right hon. Member for Basildon and Billericay (Mr Holden), who previously represented Lanchester, Burnhope and Castleside in the North West Durham constituency in the last Parliament, and who has been most courteous and helpful in handing over responsibility for those fine communities.
I urge hon. Members to visit North Durham. As well as fine towns and villages, it has stunning countryside and attractions including Beamish, the world-famous open-air museum that brings the history of north-east England to life, and Durham county cricket club’s Riverside ground.
Kevan always described North Durham as a rural constituency with urban problems, and that remains the case. Mining is at the heart of the history and previous economy of North Durham. Almost every village has a pit wheel memorial; many also have memorials to terrible mining disasters, and many have lodge banners that are paraded at the Durham gala. The decline of the industry over many decades and its eventual destruction in the 1980s, along with the closure of other major local employers, left terrible economic and social scars and a sense that some communities in the constituency have been left behind. Levelling up, if it reached anywhere, did not reach the proud communities that elected me.
That brings me to the local importance of the topic of today’s debate: economy, welfare and public services. North Durham needs economic stability and growth. It is a travesty that there are so many families dependent on food banks. It needs new skilled and well-paid jobs in the industries of the future. It needs investment and project decisions by the Government to be targeted at creating jobs where they are most needed.
North Durham needs a fairer distribution of public spending. Changes to the local government funding formula over the last 14 years have been unfair and removed resources from authorities such as Durham county council that are dealing with the highest levels of deprivation, and hampered their ability to deliver effective local services. That urgently needs to be changed in the next local government funding settlement.
Capital spending on public services is also urgently needed. On Friday, I visited Sacriston academy, a primary school, and was horrified to find excellent teachers delivering high-quality education, but in a setting that was literally falling down, with ceilings held up by scaffolding joists and whole classrooms, built in 1910—indeed, famous former pupils include Bobby Robson—now unusable due to water penetration through the ceilings and walls. Local children deserve so much better.
Public transport in the constituency is not fit for purpose. We need more frequent and reliable buses and more trains stopping at Chester-le-Street. We also need the economic regeneration of local town centres. The once thriving Front Streets of Chester-le-Street and Stanley are run down and need new life.
I think the House for listening to me today. I look forward to contributing to debates here and to fighting tenaciously for the cause of North Durham and its people and the wider north-east.
Mr Deputy Speaker (Sir Edward Leigh)
Order. I apologise to any Back Benchers who have not been able to get in, but I am afraid we now have to move to the wind-ups, and I call the Liberal Democrat spokesperson.
Daisy Cooper (St Albans) (LD)
I congratulate the hon. Member for North Durham (Luke Akehurst) on an excellent maiden speech that highlighted the values of equality and fairness—principles that many of us can agree on—and on demonstrating his stamina by being the last Member to be called. With that level of stamina, I am sure that he will give the hon. Member for Strangford (Jim Shannon) a run for his money.
It is an honour to sum up for the Liberal Democrats. Once again, I extend a warm welcome to new Ministers and to our country’s first female Chancellor. I also congratulate new Members from all parties who gave their maiden speeches today. Their speeches did not disappoint; they were poignant, funny and bursting with passion. When I gave my maiden speech in 2019, I was very proud to say that St Albans has more pubs per square mile than anywhere else in Britain, and today’s maiden speeches have given us enough historical nuggets for a maiden speech pub quiz—maybe I will write it on the train journey home.
I am pleased that the topics of economy, welfare and public services have been brought together. Why? Well, during the general election, the Liberal Democrats put health and care front and centre of our campaign, and we did so for two reasons. First, it was the No. 1 issue that constituents raised with us on the doorstep. Every single person is impacted by the crisis in health and social care. Secondly, we know that health creation and wealth creation are two sides of the same coin. We cannot have a thriving economy if our population is sick.
We Liberal Democrats set out an ambitious agenda during the general election, and we are pleased about some of the pledges in the King’s Speech. We are pleased that there will be reform of the Mental Health Act 1983, which is incredibly long overdue, and a number of other public health measures—especially on the protection of children’s health. However, we in this House all know that it is equally important to tackle the social and commercial determinants of health, and tackling child poverty is just as important as tackling the aggressive marketing of vapes and energy drinks. That is why scrapping the two-child benefit limit is in our Liberal Democrat amendment.
It is also important that we focus on access to health and social care services. People must be able to access the care that they need when they need it. That is where the Liberal Democrats want to see more ambition. We need to fix our crumbling hospitals, we need mental health hubs in communities, we need to boost our GP numbers, we need to guarantee that people have a legal right to see their GP within seven days, and we need to put an end to dental deserts.
We all know someone who has had cancer and died, or someone who has had cancer and survived, but in every single year from 2015, the Conservative Government missed their cancer treatment target. We cannot allow that to continue. That is why we Liberal Democrats wanted there to be a legal right—through a statutory duty on Ministers—for this House and the public to hold Ministers to account on ensuring that people can see a GP and get their cancer treatment when they need it.
We Liberal Democrats will also be unapologetic and unrelenting in our focus on social care. We have campaigned for free personal care, and we will continue to do so. Free personal care is good for people’s independence and dignity, and for the NHS. It would also enable the many millions of unpaid carers, who currently pick up the pieces of a broken social care system, to up their hours, do more work, return to work and boost our economy. Health creation and wealth creation are two sides of the same coin.
We look forward to seeing the Government’s employment rights Bill with interest. We Liberal Democrats have campaigned for improved pay for care workers, including by proposing a higher minimum wage starting at £2 more, but that has to come with improved investment so that local government no longer has to rob Peter to pay Paul. We can no longer suppress the pay of experienced care workers to fund improved pay for new starters. We must stop ripping the heart out of a retention strategy just to tackle recruitment. We have to do both.
The King’s Speech was also an opportunity to go further on care. It was an opportunity to introduce paid carer’s leave, make care a protected characteristic, create a royal college of care workers, introduce measures to tackle to scandal of carer’s allowance overpayments, and put in place a framework for cross-party talks that would finally put social care on a firm financial footing for the future. I recognise that the King’s Speech is an opportunity for the Government to set out their priorities, but I hope very much that many of these ideas—particularly for fixing social care—may be announced in due course. As our party leader, my right hon. Friend the Member for Kingston and Surbiton (Ed Davey), has said, the Liberal Democrats will continue to be the voice of carers in this Parliament.
If we want to boost the economy, we have to recognise that there are now several stages to people’s lives and careers. There has to be lifelong learning, upskilling and reskilling from cradle to grave, but we still have to make sure that every child has the best start in life. At the moment under the current system, many children—particularly those with special educational needs and disabilities—are put at a big disadvantage from the get-go, and a huge part of that is SEND funding. As one quick example, my area of Hertfordshire is one of the poorest funded education authorities for SEND. Under the Conservatives’ funding formula, it would take 15 years for children in Hertfordshire to catch up with those in neighbouring Buckinghamshire, itself one of the poorest funded education authorities. That is an entire generation of lost young children and lost education because of a Government spreadsheet formula. It is just another unforgivable legacy of the Conservative Government, and I implore the Labour Government to look at this issue with fresh eyes and real urgency.
Another engine of our economy is small businesses and high streets. Many speakers this afternoon, including many people giving their maiden speech, have talked about the high streets and local businesses that are the glue that hold our communities together. I would like to push the Government to go further, particularly on reforming business rates. Some people may remember that in the aftermath of the mini-Budget, the ex-Chancellor, the right hon. Member for Godalming and Ash (Jeremy Hunt), had spent the summer campaigning for a complete overhaul of the business rates system. On his first day in the job, I challenged him on whether he would in fact review that system. He gave me a wry smile from across the Chamber and said that he regretted campaigning so hard for it from the Back Benches. That review was left in the “too hard” basket; it is part of a long list of challenges facing the Labour Government, unfortunately with a similar refrain, but I implore Labour Ministers not to do the same. Sitting in their in-tray will be the results of the high streets taskforce, which I am sure will confirm what we already know: that the business rates system is broken, crippling high streets—particularly heritage pubs—while Amazon warehouses are being given a tax break. That system is not the foundation of a fair economy.
To conclude, there are measures in the King’s Speech that we welcome, but we want to see far greater ambition for our high streets, our children and our public services, particularly health and social care. We believe that our amendment to the Address goes some way towards addressing those things, and we urge Members to support it.
Mr Deputy Speaker (Sir Edward Leigh)
I call the shadow Secretary of State for Work and Pensions.
Mel Stride (Central Devon) (Con)
I congratulate everybody who has made their maiden speech in this debate. It is a big moment in one’s parliamentary career, but you are out the other side and nothing will be quite as traumatic as what you have experienced today. To go through them very briefly, I thank the hon. Member for Queen’s Park and Maida Vale (Georgia Gould), who told us that her great-grandfather—I think—came from Lithuania to set up a store in the middle of her constituency, which is her connection with it. The hon. Member for Finchley and Golders Green (Sarah Sackman) paid a very generous tribute to Mike Freer and the dangers and intimidation that he faced. She was also generous to Mrs Thatcher—she is clearly a very generous lady.
The hon. Member for Welwyn Hatfield (Andrew Lewin) paid tribute to Grant Shapps and his numerous and frequent Cabinet positions, as well as his commitment to Ukraine. The hon. Member for Peckham (Miatta Fahnbulleh) paid tribute to the 190 Labour women MPs who are now in the House, as well as to Harriet Harman. My hon. Friend the Member for Bromsgrove (Bradley Thomas) managed to weave King John and A. E. Housman into his speech, and informed us that Hollywood is not a city on the west coast of the United States, but is actually within his constituency. If you want to see film stars, ladies and gentlemen, go to Bromsgrove.
My hon. Friend the Member for Mid Leicestershire (Mr Bedford) has the peculiarity of having three forebears who are still Members of this House. He was generous to each of them, which shows that he is a wise man and will go far. The hon. Member for Hartlepool (Mr Brash) stressed the industrial and shipping heritage of his constituency, and how it was indeed bombarded by the Germans in world war one, but it gave as good as it got. My hon. Friend the Member for West Suffolk (Nick Timothy) praised his predecessor, Matt Hancock, of course focusing on racing and horses—although not, I noticed, on horseplay as such.
The hon. Member for Newton Aycliffe and Spennymoor (Alan Strickland) focused, with great pride, on the Hitachi Rail company in his constituency—shortly, I am afraid to tell him, to be seized by the Labour party and nationalised as part of its Government programme. My hon. Friend the Member for Farnham and Bordon (Greg Stafford) stressed defence spending, the hon. Member for Cities of London and Westminster (Rachel Blake) leasehold reform and the hon. Member for South Antrim (Robin Swann) the importance of agriculture.
I was out of the Chamber for the speech of the hon. Member for Didcot and Wantage (Olly Glover), and the Whip’s note simply says, “He said that there was a cat rubbing his legs”, or something to that effect. [Laughter.] Representing a highly rural constituency as I do, I know that strange things do occur, particularly late on those dull winter evenings.
The hon. Member for Whitehaven and Workington (Josh MacAlister) stressed the importance of children in care. The hon. Member for Halifax (Kate Dearden) referred to her constituency as the new “Haliwood”, so another Hollywood reference there. I thought my hon. Friend the Member for Huntingdon (Ben Obese-Jecty) gave a very witty speech, and stressed the association with the RAF in his commitment to veterans. The hon. Member for Morecambe and Lunesdale (Lizzi Collinge) paid tribute to David Morris and his support for the Eden project, and I was particularly pleased to see her do that.
The hon. Member for North Down (Alex Easton) made I think one of the most moving maiden speeches that we have heard in this House for a very long time. He spoke very movingly about his parents, and we all know what pride his dad would have had in the fact that he has been successful in his fourth attempt to join us here in the House of Commons. The hon. Member for Harpenden and Berkhamsted (Victoria Collins) referenced the fact that a Roman road—Watling Street—runs through her constituency and spoke passionately about the importance of community and tolerance.
Finally, the hon. Member for North Durham (Luke Akehurst) spoke warmly of Kevan Jones, whom all of us who have been in this House for a while remember with great fondness, and the importance of skilled and well-paid jobs in his constituency. I hope that I have pretty much covered everybody and said the main things that needed saying.
Let us now turn to the debate itself, and it seems to me that the right hon. Member for Leeds West and Pudsey (Rachel Reeves), while I congratulate her warmly on being the first female Chancellor—I think that is a huge achievement and is to be very warmly welcomed—is, I am afraid, suffering from some level of amnesia. She appears to have forgotten the legacy that we have bequeathed to her. Inflation, which was up at over 10% last autumn, is now back to target. Mortgage rates are softening, real wages have been growing in each of the last 11 months and taxes have been coming down more recently under the previous Government. When it comes to debt, we were on target, as we handed over to the right hon. Lady, to see debt falling in line with her own fiscal target at the end of the fifth year, and we of course have the fastest growing economy in the G7.
One wonders where this amnesia is coming from, and it is of course nothing more than smoke and mirrors. It is to cover up the fact that the Chancellor is rolling the pitch to raise taxes. Against all the commitments she made during the general election, she will be raising those taxes in the autumn. It will not be because we have bequeathed her something of which she was not aware in advance. The IFS has made it very clear that the books were “open”, as Paul Johnson said, for all to see.
When it comes to public services, we have a proud record. On education, we have the best readers in the western world. We have been going up the PISA scales for mathematics and sciences, something that did not happen under the last Labour Government. Crime has been halved, broadly speaking, across the period from 2010 to the present day. When it comes to work and welfare, we have a near-record level of employment, and we have a low level of unemployment. And economic inactivity is lower than in every single year under the last Labour Government. What was Labour’s record? When they left office, unemployment was double the level that it is today. Under every single Labour Government in history, unemployment has been higher when they left office than when they came in. Most disgraceful of all is that youth unemployment was up 43% under the last Labour Government; under the last Conservative Government it was down by over 40%.
As for welfare, under Labour there were 1.4 million people languishing on long-term benefits for almost a decade. On pensions, we saw the 75p pension increase and the Gordon Brown raid on private pensions of £180 billion—from which the pension system never fully recovered. It is, therefore, no surprise that, under Labour, we ended up with the fourth highest level of pensioner poverty across Europe. Under Labour there were 1 million more people in absolute poverty after housing costs. There were 200,000 more pensioners in poverty and 100,000 more children in poverty under the last Labour Government than there are today.
We will be a responsible Opposition: we welcome the commitment to growth in the King’s Speech; we welcome the commitment to building houses, as long as that is with sufficient local consent; we welcome the Budget responsibility Bill in principle; and we welcome the announcements that the Chancellor has made regarding pensions: consolidating pensions and ensuring that we get better returns for pensioners and that we invest in long-term pension capital.
But there are too many echoes in this King’s Speech of the Labour of old. The nationalisation of the railways. The consolidation of GB Energy. The long hand of Government reaching—[Hon. Members: “Hear, hear!”] Labour Members cheer now but they won’t be cheering in a few years’ time. They have short memories; I remember when the railways were nationalised and it was not a pretty situation. They are bringing forward French-style employment laws that will lead to less efficient businesses and to tribunals. They will be increasing the freedoms of trade unions, who are their paymasters. And they will be dispensing with minimum service levels; that will lead to more strikes and the inconvenience of the public, but certainly not greater growth.
What have we heard in the King’s Speech on welfare, one of the biggest challenges of the modern age? Zip, absolutely nothing, nada, diddly squat—absolutely nothing from the Labour party. They talk about moving the National Careers Service from the Department for Education to the Department for Work and Pensions; well, I hardly think that will move the dial. Their back to work plan is named exactly as our back to work plan was that my right hon. Friend the Member for Godalming and Ash (Jeremy Hunt) the shadow Chancellor and I launched last autumn, but it has nothing standing behind it—not the billions of pounds of support we put in place to encourage people to go into work and to transform lives.
All we have heard from those on the Government Benches is a denigration of our job centres; these are described as places of fear by the Secretary of State for Work and Pensions, and by the Minister for employment the hon. Member for Birkenhead (Alison McGovern) as places that do not offer real help. What an insult to the tens of thousands of hard-working people up and down our country who go into those offices to help people improve their prospects and improve their lives. They are against what they call punitive sanctions; it will cost hundreds of millions of pounds to remove those and it will result in less engagement with the help that is available and diminish people’s life chances. There have been no comments whatsoever from the Government Benches on our work capability assessment reforms, that according to the Office for Budget Responsibility will see 400,000 fewer people on long-term sickness benefits. They opposed in poetry; they have to govern in prose. They have not even picked up the pen, but let me be clear: we made mistakes in government and we have paid the price at the ballot box, and it is right that my party now faces a period of reflection and does so with humility. The electorate has spoken, and we must listen. But that is not the same as saying that the vision that is Conservatism has died, even if of late it has been too often obscured. That vision still burns bright. It burns bright as a beacon of freedom, enterprise, opportunity and, yes, stability and hope in the face of—
Mr Deputy Speaker (Sir Edward Leigh)
Order. Will the shadow Secretary of State please curtail his remarks now?
The Secretary of State for Work and Pensions (Liz Kendall)
I have never seen the right hon. Member for Central Devon (Mel Stride) do a comic turn quite like that. Opposition clearly suits him, but if he wants to lead his party out of its catastrophic defeat, he will have to do a lot better.
I am honoured to close today’s debate, not only as I am speaking from this side of the Dispatch Box for the first time, but after so many truly wonderful maiden speeches. Members from all parts of the House talked about the social, cultural and economic heritage of their constituencies and about the real challenges that their constituents face, but also their talents and potential for a brighter future, given that they have a Government who are on their side. There are too many Members to go through individually, especially on the Government Benches, but let me just say this: your constituents will be very proud of you, as will your friends and family. I say that especially to the hon. Member for North Down (Alex Easton). Members have spoken with passion and conviction, especially on the Government Benches, about the need for change and to make true on our manifesto promises, and that is what this Government will deliver.
This King’s Speech turns the page on the last 14 years of chaos and decline, and it takes the first steps towards national renewal, delivering growth in every part of the country, tearing down the barriers to opportunity and repairing our public services through investment and reform. Growth is this Government’s No. 1 priority, because it is the only way that we will improve prosperity, put more money into people’s pockets and transform our public services. Our plan starts with economic stability through the fiscal lock and our Budget responsibility Bill, so that we never again repeat the mistakes of the last Conservative Government, who crashed the economy, leaving working people to pay a heavy price.
Our planning and infrastructure Bill will get Britain building again to deliver the homes and other infrastructure that our country needs. Our national wealth fund will unlock billions of pounds of private investment to support good jobs in clean energy and other growth industries of the future. The Department I am now privileged to lead is central to our growth and opportunity missions, through unlocking the potential of our pension system, getting people into work and on in their work and driving down poverty in every part of the country.
First, on pensions, people who have worked hard and saved all their lives deserve a decent income in retirement. Although the previous Government talked about the need for pension reform, in reality there was little action. In contrast, we have acted immediately. Our new pensions Bill will bring together all the different pension savings that people build up across their working lives and drive better value for money in pension schemes. These measures could help improve incomes in retirement and boost pension pots by more than £11,000. Our landmark pensions review, announced by my right hon. Friend the Chancellor, and led by the Minister for Pensions, my hon. Friend the Member for Wycombe (Emma Reynolds) will go even further in unlocking investment in British businesses and improving outcomes for British pensioners.
The second way we will boost growth and unleash opportunity is by getting Britain working again. Last week’s labour market statistics underline the truly dire inheritance we face. Britain is the only G7 country whose employment rate has not returned to pre-pandemic levels. Some 9.4 million people are now economically inactive—either not in work, or not looking for work. That is one in five of the entire working age population.
Of those people, 2.8 million are locked out of the workplace due to poor health. That includes over-50s, often women with bad hips, knees and joints—I know about that only too well—and young people with mental health problems, often lacking basic qualifications. One in eight of all our young people are not in education, employment or training. What a damning indictment of the last Government. But behind those statistics are real people, with real hopes and dreams, who were written off by the Tories, denied opportunities and support, and then blamed for the position they are in. Let me tell the House now that, under the new Labour Government, that will change.
Our plan to get Britain working will be a cross-Government effort to drive change and unleash opportunity in every corner of the country. We will create more good jobs in clean energy and through our modern industrial strategy. We will make work pay and improve the quality of work through our new deal for working people. We will cut NHS waiting times, improve mental health support and transform skills and childcare to tackle the root causes of the problem, and fix the foundations for work, not just paper over the cracks.
We will deliver fundamental change in the Department for Work and Pensions, too. First, we will overhaul jobcentres, bringing together Jobcentre Plus with the National Careers Service to create a new jobs and careers service to help more people get to work and get on in their work. Secondly, we will drive down economic inactivity through new local work, health and skills plans led by mayors and local areas, devolving responsibility and resources to provide the right support in one place, because the man—or even the woman—in Whitehall will never know what is best in Leicester, Lowestoft or Leeds.
We will also deliver our youth guarantee to ensure that every young person is earning or learning, because unlike Conservative Members we will never accept almost a million young people being written off before they have even begun. Under this Government, there will be obligations to engage with support, look for work and take jobs when they are offered, as there always have been since the original Beveridge report, but there will be no more divisive, derogatory rhetoric or claiming that people just think that they are too bluesy to work. I am in politics to solve problems, not to score cheap points and grab empty headlines that do nothing to tackle the problems in people’s lives.
Alongside our plan to get Britain working again, we have taken immediate action to deliver our manifesto commitment for an ambitious strategy to tackle child poverty. I am proud that the last Labour Government lifted more than half a million children out of poverty. The contrast with the Conservatives could not be greater, with 700,000 more children growing up poor during their time in office. The fact that 4 million children are now living in poverty is a stain on our society. That is why, within a week of taking office, I called in child poverty experts and campaigners to help start work on our plans. It is why the Prime Minister announced our new ministerial taskforce to drive action across Government, underpinned by a new child poverty unit in the Cabinet Office. I will lead that work with our Education Secretary. As the Prime Minister announced, we will look at how to use all the levers at our disposal, including household income, employment, housing, children’s health, education and childcare so that we drive up opportunity, drive down poverty and give all children the best start in life.
The Government were elected on a mandate for change, to change our economy so that it works for working people, to get our public services back on their feet and to transform opportunity by tearing down the barriers to success in every corner of this great nation. The King’s Speech takes the first steps to rebuild Britain and make every part of our country better off, delivering real change to people’s lives, giving them the chances and choices they deserve and to begin—finally—the task of restoring faith that politics can once again be a force for good.
Question put, That the amendment be made.
Business without Debate
Water Bills in Lancaster and Wyre
Cat Smith (Lancaster and Wyre) (Lab)
I rise to present a petition on behalf of my constituents in Lancaster and Wyre who are concerned about Ofwat’s proposal to see water bills increasing by an average £19 a year between 2025 and 2030.
The petition of residents of Lancaster and Wyre,
Declares that residents in Lancaster and Wyre have been significantly impacted by the cost-of-living crisis; notes that Ofwat has proposed that bills should increase by an average of £19 per year between 2025 and 2030; and further declares that households are paying for the mistakes of the privatised UK water industry whilst company bosses are handed bonus payments.
The petitioners therefore request that the House of Commons urges the Government to look into all appropriate measures to mitigate the impact of increases to water bills on households.
And the petitioners remain (etc.)
[P003003]
Aerospace Industry: Northern Ireland
(4 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Jim Shannon (Strangford) (DUP)
Thank you, Mr Deputy Speaker, for allowing me the opportunity to speak on Government support for the aerospace industry in Northern Ireland. It is not unique, but it is quite unusual for me to be leading an Adjournment debate instead of intervening in it. I hope that plenty of Members will take the opportunity to intervene on me.
Northern Ireland is an aerospace hub. We have worked long and hard to make it so, and for good reason: we are an anchor for the aerospace industry. It is something that we have built on over the last number of decades, and from suppliers to highly skilled labour Northern Ireland is a global force for aerospace. Invest NI has highlighted this, saying:
“Northern Ireland Aerospace & Defence offers a true turnkey supply solution with design, manufacture, certification and testing in one hub. The level of proximity and cohesion is unique—120 firms within 1 hour drive of each other, a high density of suppliers across all elements of the aerospace supply chain, from design and manufacture (world leading capabilities in machining, composites, polymers), to coatings, assembly, certification & testing. Our high performing and consistently reliable supply chain can meet customers’ needs at pace and with industry leading quality performance. These companies are engaged at the leading edge of advanced aerospace design and manufacturing. Every major commercial aircraft programme depends on structures, components and expert services from Northern Ireland…World-class universities and an extensive network of further education colleges provide excellent academic and vocational training.”
Sammy Wilson (East Antrim) (DUP)
Is my hon. Friend pleased that Northern Ireland has tens of thousands of jobs in the industry? We are a major exporter as a result of the aerospace industry, and when people fly around the world, a third of the seats on aircraft are made in Northern Ireland. That is an amazing figure, showing how important the industry is not only to Northern Ireland but to Great Britain and the UK.
Jim Shannon
I am always happy when my right hon. Friend intervenes, and that exactly underlines why Northern Ireland is so important. It plays above its status, with its population and the skills force that I have referred to.
I should have said, and I apologise for not doing so, how pleased I am to see the Minister of State, Department for Business and Trade, the hon. Member for Croydon West (Sarah Jones), in her place. I very much look forward to engaging with her over the next period of time. I am also pleased to see the Under-Secretary of State for Northern Ireland, the hon. Member for Putney (Fleur Anderson), in her place. She was in my constituency approximately six or seven weeks ago. She came as a shadow Minister and I told her that the next time she came, instead of asking the questions, she would have to answer them, so I look forward to the next time she comes to Northern Ireland. I am really pleased to see both ladies in their place, and to see the shadow Minister here as well.
To reinforce what my right hon. Friend the Member for East Antrim (Sammy Wilson) said, there is an existing talent pool, with more than 34% of Northern Ireland’s workforce having a third-level qualification, and costs are significantly lower than EU, US and UK averages. Operating costs are up to 30% lower than on the UK mainland or in the EU. I say with great respect and humbleness that Northern Ireland candidates consistently outperform those from other UK regions at GCSE and A-level examinations, and with a strong partnership between academia, industry and Government driving skills development in the region, it is little wonder that we are thriving. I want to say how pleased I am at that.
Sarah Dyke (Glastonbury and Somerton) (LD)
In a segue from Northern Ireland to Somerset, Leonardo is an aerospace manufacturer located just outside my constituency. Last month it held its AeroWomen event to highlight the diversity of careers for women in the sector. Does the hon. Member agree that the Government can play a role in encouraging more girls and women to study science, technology, engineering and maths—STEM subjects—and to work in this field, which would help to close up the skills shortages that the industry faces?
Jim Shannon
Yes, I agree. I am glad to say that, in Northern Ireland, Spirit AeroSystems and the aerospace sector are already trying to achieve some of those goals by giving introductions to ladies in engineering. I am very encouraged by that, and the hon. Lady is right. We have heard a woman Chancellor speak in the House today, which is an example of what we all wish to see. It is wonderful to have ladies elevated to different positions, and we have that in engineering, at Spirit and across the aviation sector.
This has undoubtedly been a holistic effort, with Invest NI involvement and Government support. It is clear that this has paid dividends, with the Northern Ireland aerospace, defence, security and space sectors on track to achieve revenue of £2 billion a year by 2024. The sectors had a turnover of £1.9 billion and contributed almost £1 billion in value added to Northern Ireland’s economy in 2022.
Robin Swann (South Antrim) (UUP)
The hon. Gentleman mentions the military side of aviation in Northern Ireland. Does he agree that we are underutilising the Royal Air Force base at Aldergrove? The Government could look at that, as well as enhancing Belfast International airport in my constituency.
Jim Shannon
The hon. Gentleman spoke in his maiden speech today about what could be done at Aldergrove and Belfast International airport. I see that, as we probably all do, as a way of advancing aerospace across Northern Ireland for everybody’s advantage.
Support for the sector has resulted in an employment dividend, with 7,000 people believed to be directly employed. There are also the skills and the varied subsidiary companies whose bread and butter is supplying this industry. Strangford has hundreds of people employed in this sector, so I have much to be proud of.
However, it is clear why I have called this debate. One of the major employers under Spirit has a factory in my constituency and employs hundreds at its east Belfast site, and it has taken the decision to sell its operations here. I am privileged to have secured the debate for that reason. I told the press in the run-up to the election that I would make this an issue, and I am glad to have been able to speak to the Minister to highlight it last week.
Claire Hanna (Belfast South and Mid Down) (SDLP)
The hon. Gentleman rightly speaks about the potential changes. He will recall that a trade union-led campaign saved Harland & Wolff in 2019. I am sure that, like me, he was down at the yard many times to support the campaign. It was the unions that had the tenacity to keep it open and the vision to see potential green jobs down the line. Does he agree it is important that the trade unions are kept involved in any discussions about the future of the site?
Jim Shannon
The hon. Lady makes a pertinent point, and I absolutely agree about the importance of unions. The last sentence of my speech will underline the important role played by the unions.
The operations are being sold as a going concern, which is encouraging. However, my going concern is to ensure that it does not result in jobs being lost, but results in an even stronger aerospace industry in Northern Ireland. That is why I am pressing for Government involvement and support to ensure that happens.
Spirit announced on 1 July that it had signed a definitive merger agreement under which Boeing will acquire Spirit. Spirit has also entered into a binding term sheet with Airbus, under which Airbus will assume ownership of certain Airbus programmes carried out by Spirit. That includes the A220 programme at our Belfast site.
Gavin Robinson (Belfast East) (DUP)
My hon. Friend makes an important point not only about trade unions but about job retention. It will be important in the days and weeks to come that the Minister of State, Department for Business and Trade, the hon. Member for Croydon West (Sarah Jones), the Under-Secretary of State for Northern Ireland, the hon. Member for Putney (Fleur Anderson), and the Secretary of State for Northern Ireland impress upon Airbus that, in assuming responsibility for the wings facility, it is taking on grandfathered obligations that arise from Northern Ireland Executive and national Government commitments that led to the construction of that facility. Airbus should be in no doubt that, if it takes on the wings facility, those obligations sustain, and that its commitment to the workforce in Belfast should sustain. I hope my hon. Friend the Member for Strangford (Jim Shannon) agrees with me, but I am also keen to hear that the Minister is prepared to advance that issue with Airbus in the coming days.
Jim Shannon
I thank my right hon. Friend for his comments. In my discussions with the Minister last week, I took the opportunity to give her my contribution and my final asks. We are looking for positive answers, and I think my right hon. Friend will not be disappointed when the Minister responds; certainly, I hope that will be the case.
I am aware that Spirit is in the process of securing a responsible owner for the remaining activities in its Northern Ireland operations, hopefully including the facility in Newtownards, which is severely underutilised. I wish to underline something that the company has been at pains to highlight: the decision to offer the non-Airbus part of the Belfast site for sale is not a reflection on the operation’s performance or capabilities. Spirit is one Northern Ireland’s largest investors and biggest employers, with over 3,500 employees. It has a highly skilled, adaptable workforce and an extensive, integrated Northern Ireland and GB supply chain. That must remain the case because it is clearly a key part of the local aerospace ecosystem and its operations have a major impact on the Northern Ireland economy. I cannot underline enough the importance of its impact on the Northern Ireland economy.
Adam Jogee (Newcastle-under-Lyme) (Lab)
I thank the hon. Member for Strangford (Jim Shannon) for giving way. As somebody who has spent many years watching his interventions on other people, it is a pleasure to be able to intervene on him. The hon. Gentleman will know how important Northern Ireland is to me and my family, and to many people in Newcastle-under-Lyme. Will he take the opportunity to place on the record his welcome of this Government’s commitment to upskilling young people right across our United Kingdom?
Jim Shannon
The hon. Gentleman and I have been friends for many years. I am pleased that he has been able to participate in the debate; he said he would if the opportunity arose. I agree with what he says, and I think the Minister will underline it her response.
Sammy Wilson
Given the difficulties with the apprenticeship levy and the way in which firms in Northern Ireland have lost out, does my hon. Friend wish, like me, that the Government will remedy that situation, so that when firms in Northern Ireland pay into the apprenticeship levy, they can benefit from that in training young people?
Jim Shannon
That is another issue for the Minister. I wholeheartedly agree with what my right hon. Friend says, and others do as well. An anomaly needs to be addressed; hopefully the Minister can do that. I want to stand by workers who have come to me seeking assurances, so I look to the Minister to provide those assurances.
I seek an assurance that the Government understand the nature of aerospace in Northern Ireland, and how essential the Spirit operations are to our economy and employment. The Belfast site is a global leader in aerostructures, with unique end-to-end capabilities through design and development, testing and manufacture, to after-market support. The operation has engineering and technology leadership in advanced materials and ultra-light structures, in particular unique advanced composites capabilities, which it is further developing for commercial, defence and space applications.
Spirit does so much, and it can do so much more for Northern Ireland. Its extensive expertise has led to significant investment in R&D and engineering skills and capabilities over many years. The investment can and must continue to support the key role that Northern Ireland plays in the UK-wide sector. I always say what a pleasure it is to be an MP in this great United Kingdom of Great Britain and Northern Ireland, and I mean that from the bottom of my heart. I think we are better together wherever we are. We can exchange ideas and advance things; that cannot be overstated enough and must be made crystal clear.
It is clear the site is ready for a buyer and that a Government standing by the industry, ready to continue investment in R&D and site improvements, will make this even more attractive for purchase. The Government are aware of the crisis looming over Northern Ireland manufacturing, with the difficulties in Harland and Wolff. Indeed, the Government released a written statement about that today. My right hon. Friend the Member for Belfast East (Gavin Robinson) has been at the fore of trying to address that issue. Whatever the reasons may be, we look forward to the hopeful possibilities of something that has the potential to get us beyond the problems we have today.
However, the outworking of these issues at this time is that the workers at Spirit cannot help but fear that there is trouble, not simply in the water with the shipping industry, but in the air with factories in Morocco and Mexico seeking to undercut costs but not quality. Now is the time for this Labour Government—my Government, my Minister, here in this House, for me and for my constituents in Strangford—to make it clear that they will deliver for my constituents. It is no secret that my politics lie to the left of centre; I am very pleased to see the Minister in her place and to see the things I hope to see over the next period of time.
It is important that we make clear our commitment to the Northern Ireland economy, which is anchored in manufacturing, and send a very clear message to prospective buyers that there is an unflinching commitment to aerospace and defence in Northern Ireland that will be outworked in development grants and tax aid to secure the future of this facility and, indeed, its expansion in the future.
In conclusion, I look to the Minister now to outline how her Government—as I have said, this is my Government as well—can and will send the right message today. I am very glad—this is a personal opinion, not necessarily a party one—to see a party, the Labour party, come to power, as it speaks for the workers, understands the rights of the workers, and understands the importance of an industry that is at the centre of the future economic plan of Northern Ireland. I now look to that Government to put action to all the words and secure the future of this sector, which is far from being on its last legs, and, indeed, is longing and equipped to soar even higher than it is now.
The Minister of State, Department for Business and Trade (Sarah Jones)
I thank the hon. Member for Strangford (Jim Shannon) for introducing this debate tonight. I had wondered who was going to intervene on him as he could not intervene on himself. I am grateful that several hon. Members did the job for him. I also want to thank him for his dedicated support for Northern Ireland’s remarkable aerospace industry, which is founded on strong engineering heritage and is rich in knowledge, skills, experience and technology. Indeed, as this is my first time at the Dispatch Box since I was given this ministerial appointment, I am delighted that it is to discuss and highlight the Government support for the Northern Ireland aerospace sector.
I can absolutely assure the hon. Member and the whole House that this Government will work tirelessly to deliver economic growth in Northern Ireland and across all corners of the United Kingdom, so that we can drive inward investment, enable British industry and businesses of all sizes to grow and prosper, and give working people more secure employment.
Gavin Robinson
I am grateful to the Minister for giving way. I congratulate her on her appointment and wish her incredibly well.
May I encourage the Minister to access the Royal United Services Institute report into defence spending in Northern Ireland? When she reads it, she will recognise that Northern Ireland to date has received one fifth of the UK average spend on defence per region around the United Kingdom. There is a huge opportunity for her to increase support and investment for Northern Ireland and for the industry at the heart of this debate.
Sarah Jones
I thank the right hon. Gentleman for that intervention and for adding to my reading list, which is already quite substantial, as I am sure he can imagine. Our wonderful civil servants are keeping us very busy with all the things that we need to read, but, indeed, I will look at that report, as he suggests, and am happy to do so.
Delivering an industrial strategy is at the centre of the Government’s growth mission alongside our goal of becoming a clean energy superpower. We want to create the right conditions for the green industries of the future to flourish, enabling those key sectors not only to transform the UK economy, but to become world leaders in their own right.
Aerospace is crucial to this growth mission, with investment in research and development key to delivering the next generation aircraft for sustainable flight. That is why I am very much looking forward to attending the Farnborough International Airshow tomorrow for the first time as a Minister. I will be meeting UK aerospace companies and see for myself the vast array of pioneering products and services being sold across the globe. I am hoping to see all the partners involved in the Spirit discussions tomorrow and to talk to them about this topic.
Jim Shannon
I understand that there is a tent at the Farnborough show that has a Northern Ireland section. I am sure that the Minister will attend that show, and have a chance to interact with the companies there. Sometimes people say that if Ministers go there, they get them for about 15 minutes. I suggest that she spends a wee bit longer there.
Sarah Jones
I am delighted that the hon. Member has intervened in his own Adjournment debate. I will be there at the UK stand tomorrow, and we will see what Northern Ireland has on display. I will spend as much time there as I can. I am there for the whole day, so I hope that I will spend some good time there.
As Members will be well aware, Northern Ireland has a long and impressive history in the aerospace industry. This Government are in lockstep with the sector’s ambitions to grow, compete on the world stage, and ease the transition to net zero flight. Today, the aerospace sector supports nearly 240,000 jobs, with almost half of those employees directly employed by aerospace companies. Some 5,000 of them are in Northern Ireland. The sector as a whole is worth some £30 billion. Despite all the achievements, we recognise that the past years have been challenging for the sector, with the chaos and uncertainty of the previous Government, and the global shocks of covid, the war in Ukraine and the disruption in the Red sea. We know that the impact of those issues persists.
Adam Jogee
I know that in a previous life the Minister spent a lot of time working in and on Northern Ireland, so we are listening very carefully indeed. Labour Members are rightly very proud of devolution, and what it has meant for all parts of our United Kingdom. What engagement has she had, and will she have in the months ahead, with the Northern Ireland Executive on this and associated issues?
Sarah Jones
I welcome my hon. Friend to his place in this House. A really important aspect of the way that the Prime Minister has set about government is his telling us all that we must work together much more closely on issues that affect the United Kingdom as a whole. That means working across Government Departments and across the nations and regions. We are setting up structures to do that. The Under-Secretary of State for Northern Ireland is already talking at length to colleagues, and we have had conversations across Government on these issues already.
Alex Easton (North Down) (Ind)
Thousands of people in my constituency of North Down work in the industry. Will she consider a visit to my constituency to visit those factories? It would be a great honour for us, and she would see at first hand what is going on. It would be greatly appreciated by the hon. Member for Strangford (Jim Shannon) as well.
Sarah Jones
I thank the hon. Member for his intervention. I am of course happy to visit whatever I can. One of the best ways of understanding the issues is to go and see things for myself, and I would certainly like to do that. The Under-Secretary of State for Northern Ireland has been in Northern Ireland frequently, and we went there a few weeks before the general election was called. It was incredibly powerful to see the ambition in the business community in Northern Ireland to get things moving and growing.
The industry faces resourcing constraints, and shortages of materials and capacity. That situation is forcing some major manufacturers to slow down their planned production rates. Given all those challenges, it is only right that we support aerospace manufacturers in Northern Ireland and across the UK, and the industrial strategy will be the cornerstone of that work. We believe that the strategy will grow our share of the global aerospace manufacturing market, unlock huge investment opportunities that will fuel research and development, and create new high-skilled, high-paid jobs across the economy, including in aerospace. The Government will work in close partnership with the aerospace sector, support clean growth and continue to develop joint Government and industry strategy through the aerospace growth partnership sector council—a partnership that reaches businesses and the research base in every part of the United Kingdom.
I am aware that the hon. Member for Strangford’s debate is focused on Northern Ireland, so let me turn to Northern Ireland in greater detail. First, I recognise his reference to Harland & Wolff. As he will be aware, my right hon. Friend the Business Secretary gave an update to the House this morning via a written statement, stressing the fact that we are working with Members, the Northern Ireland Executive, trade unions and other partners to support a positive outcome for all affected sites across the UK and for its workers.
Moving back to aerospace, as the hon. Gentleman said, there are at least 120 companies in Northern Ireland supplying to every major commercial aircraft programme, boasting expertise in everything from composite design and manufacturing to precision machining and more. As he also said, one third of global aircraft seats are made in Northern Ireland, as of course are the advanced composite wings of the Airbus A220 aircraft.
It is the week of the Farnborough international airshow, and a week in which we have announced over £100 million for cutting-edge new green aerospace technologies, so the hon. Gentleman’s debate has touched down with excellent timing, particularly as I recognise—we need to cover this—that there is of course concern about the expected change in ownership of the region’s largest advanced manufacturer, Spirit AeroSystems’ Short Brothers. Short Brothers is best known for its award-winning advanced composites technology, developed and deployed on the A220 wing. The innovative design and manufacturing technique received recognition in 2019 from the Royal Academy of Engineering, the highest honour awarded to an engineering project.
Shorts employs 1,500 people on the A220 programme, supported by £113 million through a repayable funding partnership with the Northern Ireland Executive and the previous Labour Government in 2009. The ability to manufacture a complete wing in one facility is a credit to those who work there. That builds on the legacy of more than 100 years of Northern Ireland aerospace. Airbus is now working on ramping up production, and announced in April this year that it would be increasing the production rate per month to 14 aircraft by 2026. With more than 550 orders to deliver, and the likelihood of further orders to follow, this provides great certainty for the company, its employees and the Northern Ireland economy.
On the acquisition of Spirit and Shorts, Boeing and Airbus announced on 1 July that they will acquire parts of the Spirit AeroSystems global business. Boeing plans to take nearly all of Spirit’s Boeing-facing business, mostly those parts located in the United States. That sale is, however, subject to the sale of certain other Spirit operations to Airbus. Airbus and Spirit have agreed, subject to final terms, that Airbus will acquire the A220 wing and mid-fuselage. These are built by Short Brothers at its A220 wing production facility and its other Northern Ireland sites.
Spirit plans to sell its remaining Belfast operations—the non-Airbus programmes—alongside its facility in Prestwick, to another company. These advanced manufacturing sites offer engineering centres of excellence with engineering-backed capabilities, which Spirit assures us will prove to be an attractive proposition for potential buyers. Commercial negotiations are continuing as the parties work through the details of the acquisition and work towards finalising terms, with an expectation that the transaction will close in mid-2025.
The Government are working with the Northern Ireland Executive to help to ensure the best outcome for Short Brothers and all its highly skilled and hard-working staff. We have a keen interest in seeing that any acquisition includes a commitment to develop Short Brothers and its supply chain and provides the best possible opportunity for growth in Northern Ireland. That is because the Government have a clear vision for the future of aerospace across the whole UK.
We are providing support for technology development for the next generation of aircraft and engines through the Aerospace Technology Institute programme, which provides collaborative funding to companies based in Northern Ireland and the rest of the UK. That includes the isothermal variable-volume infusion, or IVI, project that we announced earlier today at Farnborough international airshow—a £10 million project led by Short Brothers to produce lighter, more structurally efficient aerostructures, enabling the transition to new sustainable aircraft. The Government will also continue to work in partnership with the Northern Ireland Executive on opportunities for growth and investment.
In summary, the UK has a vibrant and hugely pioneering aerospace sector. It is a central cog in our manufacturing economy and will play a hugely important global role in decarbonisation and net zero, nurturing some of the highest-skilled jobs and most advanced technologies in the world. UK aerospace companies and their supply chains will be at the heart of our transformative industrial strategy, and I know the Northern Ireland aerospace sector will play a pivotal role in the success of the UK sector as a whole, and in the growth and success of UK manufacturing and industry.
Question put and agreed to.
Written Statements
Harland and Wolff
(4 months ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
In recent weeks there has been media speculation over the status of Harland and Wolff and the nature of its ongoing discussions with the Government, upon which we have been unable to comment due to the commercially sensitive nature of those discussions. I am now pleased to be able to address the subject and update members of the House. My officials have been working with all parties extensively for a number of weeks to ensure an outcome for Harland and Wolff that delivers shipbuilding and fabrication across the UK and protects jobs.
After a detailed review of an application by Harland and Wolff for a UK Export Finance export development guarantee, His Majesty’s Government have decided not to proceed with the provision of a guarantee. This decision was based on a comprehensive assessment of the company’s financial profile and the criteria set out in our risk policies. We have also decided not to provide any form of emergency liquidity funding. While such a decision is not easy, it is my assessment, following extensive engagement by my officials with market players, that HM Government funding would not necessarily secure our objectives and there is a very substantial risk that taxpayer money would be lost. The Government believe, in this instance, that the market is best placed to resolve the commercial matters faced by Harland and Wolff.
A statement was published on 19 July by Harland and Wolff indicating that the company has commenced discussions with its existing creditors, Riverstone Credit Management LLC, to secure the additional funding it needs. This should allow the business to continue pursuing its short and longer-term objectives, in which the Government continue to take an interest. In all our engagements with them, Riverstone Credit Management LLC has recognised the importance of the assets at Harland and Wolff as well as the people who work there, showing a desire to find pragmatic solutions that support HM Government objectives.
Harland and Wolff indicates that these discussions on new financing should conclude in the next few days. This will involve the current CEO taking an immediate leave of absence and the onboarding of new management with a focus on recapitalisation and ensuring sustainable finances.
I know the recent media reports will have been of concern to workers across Harland and Wolff’s sites, as well as the wider supply chain. I am working closely with my colleagues the Secretaries of State for Northern Ireland and Scotland, and Ministers are also engaging with the leaders of the Northern Ireland Executive and Scottish Government, alongside the local Members of Parliament, to support a positive outcome for all affected sites across the UK. My ministerial team have also reached out to the trade unions represented across the four sites to reassure them that the steps set out by the company appear to me to hold by far the best prospects of ensuring business continuity, job security and the delivery of important existing contracts.
My officials will continue to work closely with those in the Ministry of Defence and the National Shipbuilding Office on the fleet solid support contract, for which Harland and Wolff remains a key subcontractor. Officials in the Ministry of Defence are also well engaged with the prime contractor, Navantia UK, to monitor delivery of this important contract.
I welcome potential new financing for Harland and Wolff and the appointment of new management and wish them all the best in their continued efforts to build up this business.
Shipbuilding supports 42,600 jobs nationwide, adds £2.4 billion to the economy every single year, and is an important pillar of our civil and defence industrial base. We are committed to supporting vibrant and successful shipbuilding and fabrication industries, and our skilled workforces who deliver them, in all parts of the UK, in which Harland and Wolff has its role to play.
[HCWS15]
Skills Reform
(4 months ago)
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The Secretary of State for Education (Bridget Phillipson)
I am today announcing the creation of Skills England in shadow form, before it is established as an arm’s length body within the next twelve months.
The first mission of our new Government is to grow the economy, and for that we need a skills system that breaks down barriers to opportunity and delivers for our businesses.
Skills England will build stronger, more coherent connections between skills partners including employers, education and training providers, unions and combined authorities. We need a stronger, more widespread, and more data-driven understanding of the skills needed to deliver regional and national industrial priorities. Where skills gaps are identified, we need the system to support more rapid development and delivery of high-quality training opportunities which employers and learners understand and can access.
Skills England will help ensure we have the highly trained workforce needed to deliver the national, regional and local skills needs of the next decade, aligned with the Government’s forthcoming industrial strategy. This effort will be central to enabling delivery of the Government’s growth mission, filling skills gaps in key industries.
Skills England will convene employers, education and training providers, unions, experts, combined authorities and national Government to:
develop a single picture of national skills needs, working with industry, other Government Departments, the Migration Advisory Committee, unions and the Industrial Strategy Council to build and maintain a comprehensive assessment of current and future skills needs;
identify the priority areas for skills training, including the training for which the new growth and skills levy will be accessible—in doing so, it will ensure that businesses are able to use their skills funding more flexibly and effectively, for which so many have been calling;
play a crucial role in ensuring that the national and regional skills systems are aligned in meeting skills needs, in constituencies the length and breadth of England.
Skills England will support employers across the country to shape skills training, and it will identify levers to encourage them to invest in upskilling their workforces. In doing so, it will build on the contribution that thousands of businesses already make to grow the pool of talent from which they can draw.
The functions which currently sit with the Institute for Apprenticeships and Technical Education will transfer to Skills England, as part of the new organisation’s broader remit. IfATE will continue its important work in the interim as the transition of functions to Skills England is finalised. A permanent board, Chair and CEO will be appointed in due course, to provide Skills England with the best possible leadership.
For us to deliver on the forthcoming industrial strategy and the Government’s missions, we will need to boost skills and unlock economic growth in all parts of the United Kingdom, so Skills England will also engage and work closely with the devolved Administrations.
[HCWS14]
Sustainable Aviation
(4 months ago)
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The Secretary of State for Transport (Louise Haigh)
Sustainable aviation fuel is an important part of the strategy to decarbonise air travel. It can be used in existing aircraft, and it emits on average 70 per cent fewer greenhouse gas emissions than using fossil jet fuel on a life cycle basis.
Developing, using and producing SAF will help drive our missions to kickstart economic growth and make Britain a clean energy superpower, delivering the Government’s manifesto commitment to secure the UK aviation industry's long-term future, including through promoting sustainable aviation fuels.
Today, in addition to the announcement we have already made in the King’s Speech on 17 July that a Bill will be introduced to support sustainable aviation fuel production, we are taking a further important step in confirming that, subject to parliamentary approval, we will introduce a SAF mandate to start from 1 January 2025. We will be one of the first countries in the world to legislate in this way. We are also today confirming the full policy detail of the mandate.
Today’s announcement is good for aviation, the environment and for the UK overall: sustainable aviation fuel production is estimated to add over £1.8 billion to the economy and over 10,000 jobs across the country while supporting decarbonisation. The SAF mandate will drive demand for SAF in the UK, deliver emission reductions up to 2.7 MtCO2e in 2030 and up to 6.3 MtCO2e in 2040 and provide investor confidence that the UK will be a place to produce, use and supply SAF.
SAF mandate
The SAF mandate will start in 2025 at 2% of total UK jet fuel demand, increase on a linear basis to 10% in 2030 and to 22% in 2040. From 2040, the obligation will remain at 22% until there is greater certainty regarding SAF supply.
The mandate will encourage the innovation of advanced fuels that can generate greater emission reductions and the diversification of feedstocks to reduce dependencies on scarce resources, by including in the mandate:
a cap on the feedstocks used in the hydroprocessed esters and fatty acids process, but not until other types of SAF are also commercially viable to recognise the important part that HEFA SAF will play in the 2020s. HEFA supply will not be limited under the mandate for the first two years, fall to 71% in 2030 and still contribute 35% in 2040;
a separate obligation on power to liquid fuels from 2028 that reaches 3.5% of total jet fuel demand in 2040.
The mandate will include a buy-out mechanism for both the main and power to liquid obligations to incentivise supply while protecting consumers where suppliers are unable to secure a supply of SAF. These will be set at £4.70 and £5.00 per litre of fuel, respectively. These provide a significant incentive for fuel suppliers to supply SAF into the market rather than pay the buy-out. They also set a maximum price for the scheme, and therefore deliver emission reductions at an acceptable cost. The plan includes a review mechanism to help minimise the impact on ticket fares for passengers.
We will also work closely across Government on feedstock availability to ensure that feedstocks are used in a sustainable and productive way.
SAF revenue certainty mechanism
The Bill announced on 17 July will introduce a revenue certainty mechanism for SAF producers who are looking to invest in new plants in the UK. This builds on the SAF mandate, which will create demand for SAF by setting targets on fuel suppliers to use a proportion of SAF. This new sector will create jobs and growth opportunities in the UK, help secure a supply of SAF for UK airlines, and enhance energy security.
There are a number of SAF projects being developed across the UK. Bringing in a revenue certainty mechanism will help to reduce risk, giving investors the confidence they need to invest in UK SAF plants. It will increase the likelihood SAF plants will be built in the UK, thereby securing a supply of SAF for the UK aviation sector and supporting the delivery of the SAF mandate.
These two SAF initiatives will drive the Government’s mission-driven plan to kick start economic growth and make Britain a clean energy superpower.
[HCWS16]
Introduction: Lord Hermer
Arrangement of Business
Lord Kennedy of Southwark (Lab Co-op)
My Lords, today we have the first Oral Questions of this new Parliament. As I have said many times from the Opposition Dispatch Box, it is called “Question Time” for a reason. The Companion is clear: questions should be “short and clear” and
“confined to not more than two points”.
Question Time is not an opportunity for Members to make statements or speeches, or to give lengthy opinions, as we saw on several occasions in the last Parliament. This also applies to our ministerial colleagues, who should keep their answers as brief as possible and focus on the key points. This discipline across the House will ensure that as many Members as possible are able to ask a question. It will provide for better scrutiny and challenge of the Government at Question Time. There is no greater gift to a Minister at Question Time than a long speech containing lots of unclear questions, which allows the Minister to pick the easiest one to answer.
The House prides itself on being self-regulating. To make that work, let us all impose some regulation on ourselves. There is a role for the Government Chief Whip to intervene if the House cannot decide who the next questioner is. I have no wish to do this, but I will keep a tally of which Benches have asked questions and intervene if necessary. I would be grateful if noble Lords continued to follow the guidance set out in the Companion.
Baroness Williams of Trafford (Con)
My Lords, may I just confirm to the Government Chief Whip that we absolutely support him in every word he said? Goodness knows, I have said it enough times myself. I have a little black book to tell him who the biggest culprits are.
Northern Ireland Dentists: Amalgam Fillings
(4 months ago)
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Baroness Hoey
To ask His Majesty’s Government what plans they have to ensure that dentists in Northern Ireland will still be able to use amalgam fillings when the EU ban their use from January 2025.
The Parliamentary Under-Secretary of State, Department of Health and Social Care (Baroness Merron) (Lab)
My Lords, on 19 July, as a result of constructive work between the UK Government and the EU, the EU published a notice that recognises the unique circumstances of Northern Ireland and the representations that have been made by the UK Government. It set specific arrangements in place for Northern Ireland, providing an additional 10 years to still use amalgam fillings, or until an earlier time is agreed by the Minamata convention, to which the UK is party.
Baroness Hoey (Non-Afl)
My Lords, I thank the Minister for that Answer, which will be very much welcomed by dentists in Northern Ireland, but does she understand that there is a fundamental issue here? There are many more health and other regulations that will need that kind of begging of the EU to make a difference, because Northern Ireland is still under the Windsor Framework and the protocol. Will she commit to working to ensure that Northern Ireland’s place in the United Kingdom, as a fully integrated part of the United Kingdom, is restored, and that this Government will do what they can to make that happen as soon as possible?
Baroness Merron (Lab)
As the noble Baroness is more than aware, the Windsor Framework is exactly about safeguarding Northern Ireland’s integral position in the union and the UK internal market. I can assure your Lordships’ House that the Government are committed to implementing the Windsor Framework in good faith. This is a particular set of circumstances and the first opportunity to secure such arrangements, so it is important to see it in this light. I am glad that the noble Baroness welcomes this action by the Government; it is certainly intended to serve the good people of Northern Ireland, and I am glad to be able to present that today.
Baroness Ritchie of Downpatrick (Lab)
My Lords, I refer to my entry in the Register of Lords’ Interests. I welcome the derogation on amalgam fillings, because that issue has been persisting for some time. It proves that a Labour Government are working to find solutions to the outstanding matters relating to the Windsor Framework. In that respect, will the Minister and her colleagues undertake to provide us with details of the resetting of the relationship between the UK and the EU? There are several outstanding matters relating to veterinary medicines and the EU’s carbon floor.
Baroness Merron (Lab)
I am glad that my noble friend welcomes today’s announcement. I am sure the House will appreciate the particular set of circumstances surrounding amalgam, which are extremely complex. This has required considerable collaboration between several departments, as well as the devolved Administrations. I hope it will be regarded as something very positive, but I can assure my noble friend and your Lordships’ House that I will discuss with my ministerial colleagues the points being raised about the Windsor Framework and the relationships that that entails.
Lord Lexden (Con)
Do the Government accept that there is indeed a considerable amount of further work to be done to ensure that the Windsor Framework provides fully for the free movement of all goods within our precious single market?
Baroness Merron (Lab)
Certainly, the Windsor Framework, under which some EU rules apply in Northern Ireland, is intended to help the EU and the UK work together constructively and to ensure the smooth flow of trade within the UK internal market. I am sure that my colleagues in the Northern Ireland Office will continue to keep that under review. I know that the Northern Ireland Secretary has been very involved in the amalgam issue.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, will the Minister confirm that the noble Baroness, Lady Hoey, is one of the people who got us into this mess in the first place?
Baroness Merron (Lab)
I thank my noble friend for his opinion; that is noted. The Question from the noble Baroness, Lady Hoey, was extremely welcome.
Lord Caine (Con)
My Lords, I congratulate the noble Baroness on her appointment. Clearly, we strongly support the derogation for Northern Ireland, on which we were working tirelessly prior to the election. While agreement is always to be preferred, the Stormont brake remains a crucial democratic safeguard for Northern Ireland in order to prevent the imposition of new EU laws and regulations that, in this case, could have had a devastating impact on dentistry and public health. In the event of that brake ever being activated, will the new Government commit to standing by all its provisions, including the exercise of a veto where necessary?
Baroness Merron (Lab)
I thank the noble Lord for his kind words of welcome and can assure the House that I will certainly do my best in my new role. On the important issue of what next, which I believe the question raises, this will now be a matter for the Democratic Scrutiny Committee in Stormont. It will look closely at what this new arrangement potentially means and will decide the next step, so I suggest that it is in the right place. Of course, we will continue to work closely with our colleagues in Northern Ireland. I believe there will be next steps after we have had the opportunity to hear what the committee says.
Lord Harris of Haringey (Lab)
My Lords, I refer to my interest, as listed in the register, as chair of the General Dental Council. Can the Minister express a view, on behalf of His Majesty’s Government, on the safety of amalgam fillings?
Baroness Merron (Lab)
Yes, I can confirm that amalgam is safe. The reason for this phase-down of the use of mercury, which is in amalgam fillings, is related to the environment. When mercury is released into the environment—for example, through emissions from crematoria—it can get into the food chain, where it accumulates mainly in fish such as shark and tuna. That can affect those who have a fish-rich diet, in countries such as Greenland, Brazil, Japan and China. However, there is no evidence whatsoever that amalgam is unsafe, and it is with that in mind that we have sought this arrangement for Northern Ireland.
Lord Forsyth of Drumlean (Con)
Further to the noble Lord’s rather ungracious question, can the Minister confirm that if we had not left the EU, it would not have been possible to continue with the use of amalgam?
Baroness Merron (Lab)
I am sure that there are many opinions in your Lordships’ House about what would have happened if we had not left the EU, and I think it is probably appropriate that I leave it there.
Lord Scriven (LD)
Does the Minister agree that it is the policy of the British Dental Association eventually to remove amalgam, so this is about not whether it is removed but the timing of its removal, in a way that helps to ensure continual dental services?
Baroness Merron (Lab)
It is indeed, and I thank the noble Lord for his observation, which is absolutely correct. We are very grateful to the British Dental Association for working closely with us not just on this issue but on how we are going to restore NHS dental services across the country, because that is a real task we are going to have to battle with.
Mail Carriage by Rail
(4 months ago)
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Lord Snape
To ask His Majesty’s Government whether they plan to meet the Royal Mail Group to discuss the Group’s plans to end the carriage of mail by rail from October.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
We are fully committed to supporting rail freight growth, recognising significant economic and environmental potential. Following our plans to overhaul the railways, Great British Railways will have a duty and targets to grow rail freight. I have discussed the decision regarding its trains with Royal Mail. As it is now a private company not owned or controlled by the Government, the mode used to move mail is a commercial decision for the business.
Lord Snape (Lab)
My Lords, at the risk of appearing in the Government Chief Whip’s black book, I congratulate my noble friend on his appointment in the Department for Transport and want to say how much it is welcomed by those of us who take an interest in these matters. Could he perhaps read the Riot Act to Royal Mail Ltd? Despite the fact that it is a semi-privatised organisation and he has no real control over it, does he agree that it is deplorable that a century and a half of traditional and dedicated rail carriage of mail is to be cast aside to carry mail on a fleet of heavy goods vehicles, so adding to the congestion and pollution on our roads and motorways? Further, is there not something wrong with a licensing system that makes it cheaper for companies to behave in this way rather than, as my noble friend has suggested, transferring freight from road to rail?
Lord Hendy of Richmond Hill (Lab)
The mode of transport chosen by Royal Mail is an operational decision, over which Ministers and the regulator have no role under postal regulation. It has emphasised the low-carbon credentials of its road fleet, using electric vans and biofuel in HGVs to reduce emissions. However, I have already encouraged Royal Mail, and will continue to encourage it, to take an ambitious approach to the wider use of rail freight as part of its commitments to net zero and to reducing congestion our roads, including exploring the innovative and growing express rail freight sector. I assure your Lordships’ House that, in my new role as rail Minister, I will be championing the role of freight on our railways.
Lord Kirkhope of Harrogate (Con)
Will the Minister please respond to the concerns of many people in this country who feel threatened by the changes involved in the new proposals for the daily delivery of domestic letters and parcels to our houses? Will he comment on the proposals to diminish this service?
Lord Hendy of Richmond Hill (Lab)
In respect of the carriage of mail by rail, my department officials are working closely with officials from the Department for Business and Trade. I would be happy to take the noble Lord’s comments back to both departments. I have to say that this is still an operational decision for Royal Mail, over which Ministers and the regulator have no role under postal regulation.
Lord Sikka (Lab)
My Lords, Royal Mail is a private company but the effects of its operations are public. It affects traffic congestion, as has already been mentioned, as well as health and carbon emissions. This will have some impact on everybody. In the light of that, can the Minister explain what additional taxes will be levied upon Royal Mail for causing these harms?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for his question. Only 3% of Royal Mail’s letters and parcels are moved by rail. There are 600 freight services running on the network every day, of which the trains in question account for just six, so it is not thought that this will have a substantial impact on the overall amount of freight moved by rail. The matter of the taxation regime for rail and road is quite different.
Baroness Randerson (LD)
I congratulate the Minister on his new appointment and thank him for his early comments, but point out that, while Royal Mail may be an independent company nowadays, it works within a legislative framework. Are the Government considering amendments to the legislative framework for both Royal Mail and other companies in similar settings to increase their environmental obligations and raise expectations that they will use environmentally sounds forms of transport?
Lord Hendy of Richmond Hill (Lab)
The department’s officials are working closely with officials from the Department for Business and Trade. I will take the noble Baroness’s comments back to both departments.
Baroness Vere of Norbiton (Con)
My Lords, the previous Conservative Government were very supportive of the modal shift; in fact we introduced the Mode Shift Revenue Support scheme. Have the Minister’s officials pointed Royal Mail to that scheme, and might it be helpful in this regard?
Lord Hendy of Richmond Hill (Lab)
My understanding is that the Mode Shift Revenue Support scheme, which has a budget of £18 million for 2024-25, has been effective. The current scheme expires on 31 March 2025, but my current understanding is that it does not apply to the carriage of mail by rail.
Lord Grocott (Lab)
Can the Minister, whose appointment I also welcome, confirm that one of the arguments for HS2 to Birmingham was very much to free up capacity on the existing west coast main line by an additional route from London to Birmingham? In that connection, does he agree that one of the many disastrous decisions made by the previous Government was to scrap the HS2 project north of Birmingham? What assurance can he give us that the current Government, among the many changes they have planned, will change that particularly bad decision?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for that question but it moves quite a long way from the carriage of mail by rail. I think there might be more appropriate times at which to consider the railway infrastructure of Great Britain and the future infrastructure plans of this Government.
Lord McLoughlin (Con)
In congratulating and welcoming the Minister to his place—a man who will probably be giving advice to his civil servants rather than the other way around—I would like to ask him about the long-term plans for freight on the railways. What extra measures does he envisage taking, bearing in mind the serious capacity issues that have just been referred to by the noble Lord, Lord Grocott?
Lord Hendy of Richmond Hill (Lab)
I welcome the comments from the noble Lord, Lord McLoughlin. It is important that rail freight increases, but the noble Lord is correct in referring to capacity problems on some parts of the network. There are two things to do. First, historically the freight companies have a number of paths that they do not use and never have done, which are getting in the way of running more passenger trains. Secondly, in return, the Government’s emphasis on the carriage of more freight by rail demands us to look carefully at the capacity of the railway and facilitate the paths that are needed for modern freight, particularly containers and bulk aggregates, in order that traffic can increase.
Lord Wallace of Saltaire (LD)
My Lords, is the Minister aware that one of the choke points if one wants to increase the amount of freight moved by rail is across the Pennines? The M62 is crowded every day with trucks carrying containers. I am told that there are no spare freight paths between the west and east coasts in the north of England. Unless extra path capacity is provided, the Government will be unable to fulfil their commitment to increase the carriage of freight by rail in the north.
Lord Hendy of Richmond Hill (Lab)
There is certainly a constraint on the amount of railway capacity over the Pennines from east to west. The trans-Pennine route upgrade, which is currently costing £11 billion, is a significant project already in delivery that seeks to increase that capacity. I know the department’s officials have looked and are looking at what needs to be done with that upgrade in order to make sure that it is suitable for the carriage of more freight, including containers of the larger size.
Lord Berkeley (Lab)
My Lords, it is only 20 years ago that Royal Mail built probably between 26 and 29 large and complicated sorting offices connected to rail and road so that mail could be sorted. This was the modern way of doing it. Two of those—I think one of them is at Warrington and the other is at Willesden, opened by Her Royal Highness Princess Anne —are no longer going to be used. Does that have anything to do with my noble friend’s question about capacity on the west coast main line?
Lord Hendy of Richmond Hill (Lab)
The issue of the age of the infrastructure that Royal Mail uses is overtaken by the issue of the age of the train sets that it currently uses to carry mail. There were originally 15 train sets built, but only six are now in service and they are all 30 years old. Royal Mail’s judgment is that these railway vehicles are now of an age when they are becoming unfit for service.
Lower Thames Crossing Development Consent Order
(4 months ago)
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Lord Colgrain
To ask His Majesty’s Government whether they expect to meet the statutory timeframe within which a decision on the Lower Thames Crossing Development Consent Order must be made.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
The statutory deadline for a decision on the lower Thames crossing is 4 October 2024. Although the department always attempts to meet its statutory deadlines, I cannot comment further on what is a live planning application.
Lord Colgrain (Con)
I thank the Minister for his reply, and I too congratulate him on his new appointment. He will know that the Dartford Tunnel on the M25 has reached its design life’s term, and that the lower Thames crossing is intended to alleviate forecast massive capacity constraints. It was first studied by his department in 2009, with the final route decided in 2017. It is incredible that this project has cost £800 million in fees to date, and even more incredible that, including changes and resubmissions, it has attached to it the longest written development consent order in this country’s history at more than 350,000 pages. Given that it is this Government’s avowed intent to promote key infrastructure and grow the economy, can the Minister think of any good reason why this application should not be approved by its 4 October deadline?
Lord Hendy of Richmond Hill (Lab)
I would hope that it will be, but the noble Lord will know that the deadline was delayed because of the general election, and the new Secretary of State in the other House will need time to correctly assess the large and complex nature of the arguments for and against it. This is one of the largest planning applications that the department has ever dealt with. It is important that the Government plan projects properly and are open about the challenges and natural uncertainty of delivering a project of this size. But that is why the new Government have committed to speed up the delivery of vital projects and announced new legislation that will seek a streamlined and proportionate process to update national policy statements, which are the cornerstones of the planning system for major infrastructure.
Lord Naseby (Con)
Does the Minister of the new Government fully appreciate the problems of His Majesty’s exporters, particularly from the east Midlands and the surrounding areas? There are major congestion and delays en route to Dover for our vital exports. Against that background, can His Majesty’s Government do everything within their power to ensure that this second crossing, so vital to the future success of our country, actually happens?
Lord Hendy of Richmond Hill (Lab)
I can fully understand the national issues regarding congestion at the Dartford Tunnel and the M25, but it is important that the arguments both for and against such a large project are properly examined and that a decision about the project is properly made. We of course hope that we will be able to answer this within the extended timescale given.
Baroness Randerson (LD)
My Lords, this is clearly a cautionary tale about the failures of the previous Government to manage large infrastructure projects. But is it not also a warning that, on our crowded island, our economy cannot operate effectively unless the new Government take firm and swift action in transforming our public transport infrastructure, including transferring freight from road to rail? Does the Minister agree that simply building more roads cannot solve infrastructure congestion?
Lord Hendy of Richmond Hill (Lab)
Your Lordships’ House has already heard some strong arguments in favour of this particular project. The arguments for and against it need to be properly considered in order that, when my right honourable friend the Secretary of State for Transport takes the decision, it is taken on the best possible grounds and considering the arguments both for and against it.
The Earl of Erroll (CB)
My Lords, I point out to the Minister that this road and rail project will enormously accelerate and enhance our capacity to take the high cube containers from our deep-water ports in Essex directly across to the channel and into Europe, which will enhance our trade, also using environmentally friendly rail. I cannot see what the problem is.
Lord Hendy of Richmond Hill (Lab)
On the whole, I judge that to be a statement in favour of this project.
Lord Austin of Dudley (Non-Afl)
My Lords, while he is examining the case for the Thames crossing—yet another expensive infrastructure investment in transport in the south-east—will the Minister also look at the case for the stalled Midlands Metro project and the new tramline that is supposed to go through Dudley and on to Brierley Hill and to help regenerate and boost the economy in the Black Country?
Lord Hendy of Richmond Hill (Lab)
The Government are committed to a long-term infrastructure plan that considers all the infrastructure needed to grow the economy, create jobs and build housing across Britain. It is a bit of a stretch from Dudley to the M25 at the Dartford Tunnel, but I know that the Government will look at schemes across the country and seek to take the best view of how to invest in them for the best economic future of the country.
Baroness Vere of Norbiton (Con)
My Lords, the lower Thames crossing, with which I am greatly familiar, is just one albeit large project in the second road investment strategy. Of course, the third road investment strategy is due to start in April 2025, and industry will need certainty as to what it is going to be expected to build. Can the new Government commit to keeping the level of spending commitments that the previous Conservative Government had, or will we see spending on new roads slashed in future?
Lord Hendy of Richmond Hill (Lab)
A long-term infrastructure plan for Great Britain, concentrating on growth, jobs and housing, needs to embrace all those projects that will most contribute to economic growth. I cannot say at the moment whether the third iteration of the road investment plan will be there in its entirety, but it will be looked at very carefully in the department and by Ministers in order to choose the best and most feasible projects—the ones that will deliver the most for the benefit of the country’s economy.
Spending Commitments to Local Councils
(4 months ago)
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Baroness Thornhill
To ask His Majesty’s Government whether they intend to review existing spending commitments made to local councils.
Baroness Thornhill (LD)
In asking the Question standing in my name on the Order Paper, I declare my interest as the vice-president of the Local Government Association.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, mayors, leaders, councillors and officers around the country have done an amazing job of supporting their communities, but too often in recent years that has been in spite of the Government and not with them. This Government are committed to ensuring that councils have the resources they need to provide public services to their communities in this Parliament. Of course, spending commitments beyond 2024-25 are a matter for the next spending review, but the work of engagement has already begun.
Baroness Thornhill (LD)
I thank the Minister for her Answer and warmly welcome her to her new role, for which she is most ably qualified. I am pleased to hear what she has to say, but this money is crucial. Can she be specific about a timeframe as to when councils will hear whether they have got the money? We are talking about many millions of pounds, in certain cases. More importantly, can she reassure the sector that, when decisions are made, they will involve looking at how advanced those projects already are, how much money has already been spent and, in particular, the impact on the financial sustainability of the council if it does not get the promised money? As she knows, for some councils that is critical.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness for her kind comments. We worked together often in Hertfordshire, and I hope that that relationship continues. Local places will rightly seek clarity on existing funding commitments, but as all noble Lords would expect, the Government are fully considering funding arrangements, including the very hard work that has been undertaken on projects to date. We will confirm as quickly as possible how we are going to take those projects forward.
Baroness McIntosh of Pickering (Con)
My Lords, I congratulate the noble Baroness most warmly on her new position. I remind her that she spoke from these Benches less than two months ago saying that the existing spending commitments for local councils on drainage authorities were insufficient. Does she still hold that view?
Baroness Taylor of Stevenage (Lab)
My Lords, we all know that for too long funding and support for local leaders has been fragmented and inconsistent, and the noble Baroness rightly raises the issue of those authorities that have drainage levies imposed on them. We will continue to look at that issue. I did raise it and indeed I have had correspondence since I took up this new role, so we will continue to look at that.
Lord Laming (CB)
My Lords, the noble Baroness has vast experience on this subject. Has she had the opportunity to study the recently published report by the Institute for Government entitled Fixing Public Services? It sets out in graphic terms the current situation following 10 years where demand for services has increased, but funding has not kept pace with any of it. The report suggests that unless action is taken urgently, some services for very dependent elderly and disabled people and children seriously at risk will reach a state of collapse. Can the noble Baroness assure the House that this will be prevented?
Baroness Taylor of Stevenage (Lab)
My Lords, neither I nor this Government are under any illusion about the scale of the pressures that local authorities are facing. Successive years of underfunding and increasing demand for services have left councils experiencing significant budget pressures and vulnerable to shocks, impacting the services that they provide to local people—these are key services, as the noble Lord set out. These will all have to be considered as part of the next spending review and I am sure that key adult care and children’s services will be very high on the list. I will look at the report with great interest.
Lord Young of Cookham (Con)
My Lords, I welcome the noble Baroness to her post. Further to the question about spending commitments, can she confirm that the firm commitment in the Labour manifesto,
“Labour will not increase taxes on working people”,
applies to council tax?
Baroness Taylor of Stevenage (Lab)
I thank the noble Lord for his question. Council tax increases, of course, are ultimately decided by local authorities, but the Government are committed to keeping taxes on working people and households as low as possible. We will carefully consider the impact on councils and taxpayers before making any decisions on taxes. Decisions on referendum principles will be part of the next spending review process and of course we will seek the views of local government before we take any decisions on those.
Baroness Scott of Bybrook (Con)
My Lords, since the noble Baroness, Lady Thornhill, tabled her Question, I understand that a number of local councils have had spending commitments suspended, including Harlow in Essex, which is now set to lose out on £20 million towards the rebuilding of its town centre. Can the Minister tell me how many councils have had these disappointing letters, and what the Government plan to do to support councils such as Harlow which were relying on these commitments to deliver growth and regeneration that I am sure His Majesty’s Government would want to support?
Baroness Taylor of Stevenage (Lab)
My Lords, there has to be a short pause while we seek clarity on existing funding commitments, as I said earlier. The Government are fully considering those funding arrangements and I know that a great deal of work has been put in. Many of those projects are aligned with the growth that we want, and we hope to be able to give all local authorities the answers in very short order.
Lord Sahota (Lab)
My Lords, the LGA estimates that one in 10 local authorities are on the brink of bankruptcy due to the lack of proper funding by the previous Government. What is the new Government’s policy to avert this disaster?
Baroness Taylor of Stevenage (Lab)
Under the previous Government, 19 councils needed to seek additional support from the Government to balance their budgets for this year. This Government are committed to ensuring councils have the resources needed to provide those public services. We are already working closely with local government and other departments to understand the specific demand and cost pressures facing them. We urge any council experiencing financial difficulties to approach the department as early as possible so we can help work through a plan to resolve them.
The Earl of Clancarty (CB)
My Lords, councils have many demands placed on them, but a test of how effective the Government will be is whether they can reverse the cuts to cultural and leisure activities, including libraries. This is for the simple reason that they have usually been the first services to be cut.
Baroness Taylor of Stevenage (Lab)
The noble Lord is a great champion of libraries, culture and arts in this Chamber. The severe pressure that local authority funding has come under in recent years has had a particular impact there. We will want to look closely at whether we can help alleviate those pressures. Libraries provide such a fantastic resource for our communities, as do the leisure facilities that local authorities provide.
Lord Scriven (LD)
My Lords, I declare my interest as a vice-president to the Local Government Association. Will the Government support a pilot in one area, as laid out by the Institute for Government, for a small tax assignment scheme to test what it says will be the positive impact for local areas’ revenue? If not, why not?
Baroness Taylor of Stevenage (Lab)
I am sure that officials in my department are looking with great care at the report concerned. We will consider all the recommendations in it with due care, as we always would.
Lord Hodgson of Astley Abbotts (Con)
My Lords, what plans do the Government have to update the council tax bandings? They were last reviewed in 1991 so are now virtually meaningless.
Baroness Taylor of Stevenage (Lab)
We know that the council tax banding system has been around for a very long time. In recent years, it has been important to keep the stability of funding for local councils because of the pressure they have been under. We will continue to make sure we get the balance right between local autonomy on funding and the financial pressure on residents. However, long-term funding stability in the wider local government funding system should help that. As for looking at the banding system, that could cause the kind of disruption that would make life even more difficult for local authorities.
Lord Lucas (Con)
My Lords, will the Government look carefully at whether the burden of funding homelessness could be more equitably distributed between councils?
Baroness Taylor of Stevenage (Lab)
My Lords, homelessness is one of the most serious issues that local authorities have had to deal with; it has caused immense pressure on their finances and immense distress to the people affected by it. This morning, we heard from Oxford Economics and Skipton Group that only one in eight renters can afford to buy property. We must address this and deliver the long-term solutions that are needed. We will develop a new cross-government strategy, working with mayors and councils across the country to get us back on track to ending homelessness once and for all. I hope we can also scrap the Vagrancy Act 1824 and get that off the statute book.
Conduct Committee
The Senior Deputy Speaker
Arrangement of Business
Lord Kennedy of Southwark (Lab Co-op)
My Lords, before we resume the debate on the King’s Speech, I thought it would be helpful to the House to remind all Back-Bench speakers that the advisory speaking time today is five minutes. That means that when the clock has reached four minutes, noble Lords should start making their concluding remarks, and when the clock hits five minutes, their time is up.
We have a long day ahead of us and the expected rising time is 11 pm. If every Back Bench speaker spoke for an additional 30 seconds, the estimated rising time would move to 11.40 pm. I ask all noble Lords to please stick to the advisory time. I have asked the Whips on the Government Bench, if necessary, to remind Members not to go over the allotted time.
Lord Forsyth of Drumlean (Con)
Further to the point made by the Chief Whip, what effect does he think the Labour Party’s manifesto proposal to increase participation rates in the House will have on the length of speeches?
Lord Kennedy of Southwark (Lab Co-op)
I thought that the manifesto proposal was to ensure participation, not to increase participation.
King’s Speech (4th Day)
(4 months ago)
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Lord Reid of Cardowan
That an humble Address be presented to His Majesty as follows:
“Most Gracious Sovereign—We, Your Majesty’s most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament”.
The Minister of State, Department for Science, Innovation and Technology (Lord Vallance of Balham) (Lab) (Maiden Speech)
My Lords, it is a great honour to open this adjourned debate on His Majesty’s most gracious Speech. Today’s debate will focus on economic growth, infrastructure and employment, but before I turn to today’s debate I should say that I believe it is customary for new Members of your Lordships’ House to offer some personal remarks.
I start by saying how grateful I am to the many noble Lords of all sides and the wonderful and patient staff here who have already made me feel most welcome. I also thank my supporters for my introduction last week: the Minister, my noble friend Lady Jones of Whitchurch, and the noble Baroness, Lady Manningham-Buller, who has provided advice and support to me on more than one occasion.
My family comes from Cornwall, and I grew up in a small hamlet called Greenbottom, near Truro. My mother came from the Isles of Scilly. However, when thinking about the name I should bear when taking my seat on these red Benches, I decided that perhaps neither Greenbottom nor Scilly were quite right. I plumped for Balham. Some of your Lordships of a certain vintage will recognise it as the famous gateway to the south.
I am a doctor and scientist and have worked in the NHS, academia, industry and government. It is an enormous pleasure and privilege now to be joining your Lordships’ House with its reputation for expertise and wisdom. I am at heart a scientist. Karl Popper said:
“Science may be described as the art of systematic oversimplification”.
He reminded us that
“Knowledge can only be finite, while our ignorance must necessarily be infinite”,
while
“ignorance is not the absence of knowledge, but the refusal to acquire it”.
However, in my time as the Government Chief Scientific Adviser I found that the scientist’s approach does not always align perfectly with that of others. A scientist will often be pleased to find that the results of new experiments showed that what they held to be true was in fact wrong and the world is not quite as they thought it to be. This process of discovery and self-correction is, of course, at the very heart of the scientific method.
I discovered, however, a little philosophical difference. In some political and media circles, changes resulting from new evidence may not always be so readily welcomed. Indeed, they are instead that most dreaded of things: a U-turn. I look forward to welcoming changes based on scientific findings, advances in technology and innovation.
I shall turn to today’s debate, but first I must extend a warm welcome on behalf of the whole Chamber to my noble friend Lord Timpson and my noble and learned friend Lord Hermer, who have been introduced today, as well as to the noble Lord, Lord Petitgas, who will give his maiden speech today and I hope share some of the invaluable business experience he brings to your Lordships’ House. Your Lordships will also hear from my noble friend Lord Livermore, who will wind up this evening. With his deep experience, and the expertise and insight in evidence on all sides of the Chamber, I look forward to the debate ahead.
The programme of legislation put forward in His Majesty’s gracious Speech is, in essence, about potential and how to realise it. Noble Lords will know that talent, energy and ambition are found in abundance right across the four nations of our union, from the Isles of Scilly to the Shetlands. However, they will also know that, far too often, our communities are unfairly held back by an economy that does not deliver for them.
Decades of low growth and lower investment mean that we risk falling behind international competitors, and it is hard-working people who will pay the price. That is why, as we set about the work of rebuilding Britain brick by brick, innovation by innovation, we have made growth our national mission. Without growth, we cannot answer the profound challenges that our country faces. It is growth that will provide the good jobs that hard-working people deserve, improve the public services they depend on and make people better off, and it is growth that the measures set out in His Majesty’s gracious Speech will deliver.
That plan starts with economic stability. We have been clear that we will not risk public trust or market credibility in the pursuit of political convenience. To put it simply, that means no more unfunded spending commitments. Each of the measures set out in His Majesty’s gracious Speech has sound money as its bedrock. Every decision will be shaped by strong fiscal rules designed to deliver a balanced budget and drive down the national debt.
The Budget Responsibility Bill will enshrine that commitment—the fiscal lock—in law, ensuring that every significant change to tax and spending is subject to independent assessment from the OBR. My noble friend Lord Livermore will have more to say on this later. Stability is where we start, but your Lordships should not take that stability to signal a lack of ambition. Long-term growth—growth that involves every person and every community, in a strategic partnership with business—requires change, and His Majesty’s gracious Speech shows that we are ready to turn the page.
Since the global financial crisis, the United Kingdom has been plagued by low productivity. Today, real average weekly earnings have only just returned to 2008 levels. Millions remain stuck in insecure work, and millions more are without work at all; the number of workers inactive due to long-term sickness is close to an historic high. These headline statistics also hide insidious inequalities. The national gender pay gap stands at over 14%, and a quarter of reported sexual harassment takes place at work. This is patently appalling. I am sure noble Lords will agree that, in modern Britain, it cannot continue.
Work must pay, no matter who you are. The employment rights Bill is born from that belief. It will empower British people with workplace rights that are fit for a modern economy by helping more people to stay in work—and ensuring that work puts more money in their pockets. It will not just grow the economy but will ensure that the benefits of growth are felt by all.
A modern workplace is necessary for sustainable growth but it is not sufficient. That brings me to infrastructure. Tomorrow’s economy brings demands, from laboratories and gigafactories to large-scale computers and digital infrastructure, and of course the infrastructure requirements for clean energy. Yet, from roads to railways and reservoirs, Britain’s basic infrastructure is too often the stuff of yesterday. This is not for want of trying. Many businesses have told us that they are ready to build, but burdensome planning regulations and a fragmented investment landscape prevent them from doing so.
In our cities, the sight of brownfield land sitting unused and abandoned is all too common. This House may recall the tale of a £2.5 billion data centre blocked for spoiling the views over the M25. Far be it from me to take a view on the aesthetic merits of one of Britain’s great scenic motorways, but I am confident that we can all agree on one thing: confused infrastructure and investment policies are a brake on Britain’s growth. To kick-start our economic engine, we must remove that brake. In His Majesty’s Gracious speech, we have taken our first steps to doing that.
By accelerating the planning process for housing and streamlining the delivery of major infrastructure projects, the planning and infrastructure Bill will unlock much-needed development at an unprecedented speed and scale. We will also consider how we can remove blocks to the growth of our data-centre sector—the largest in Europe—including changes to planning rules, designating the sector as critical national infrastructure, and introducing a stable regulatory environment to improve security and resilience.
Infrastructure will be a driving force behind our industrial strategy. Guided by the Industrial Strategy Council, which we will put on a statutory footing, this long-term plan will provide business and investors with the certainty and stability they need to invest and grow.
The national wealth fund is anchored in those same values. It will align the UK Infrastructure Bank and the British Business Bank under a permanent institution that provides a coherent offer for business and a compelling proposition for investors. By working closely with regional mayors, the fund will strategically deploy public capital to deliver long-term growth and prosperity for communities in every corner of the country. By mobilising billions more in private capital, its impact will be transformative, creating thousands of good jobs for British people in the industries of the future.
Science and technology can improve the lives and life chances of our citizens by driving economic growth, improving public services, and providing resilience and security. Government has a vital role to play in making that possible. It is only by realising the full potential of technological innovation that Britain’s businesses will succeed, Britain’s public services will modernise and the British people can prosper. Our task therefore is to accelerate innovation, investment and productivity as essential elements of Britain’s industrial strategy. Our approach combines discovery and delivery, opportunity and security.
The strength of Britain’s research sector already provides us with a clear competitive advantage. These islands are home to four of the top 10 universities in the world. We have many more world-class institutions that create the knowledge we need for the future. They act as catalysts and anchors for innovative start-ups and scale-ups. The phrase “Silicon Fen” may lack a certain something, but the story it points to is remarkable. Last year, Cambridge was the most intensive science and tech cluster in the world. It is not just Cambridge: from small satellite manufacturing in Glasgow to compound semiconductors in south Wales, diverse science and tech clusters are creating opportunities for communities up and down the country.
Yet, in each one, the same challenges put prosperity in peril. A lack of laboratory space is stifling the expansion of a life sciences sector which, until now, has been one of our great industrial success stories, employing over 300,000 people and generating over £100 billion in turnover. At the same time, firms are struggling to access the capital they need to grow, and rigid regulation prevents them bringing innovative products to market. If we are to face up to these challenges and provide opportunities for these firms to grow a more productive and prosperous economy, improve our public services and make people better off, we need change.
Once again, the starting point for change is stability. We will scrap short-term funding cycles for certain types of R&D activity, replacing them with 10-year budgets that will provide researchers with an opportunity to form meaningful partnerships with business and to take a long-term view—partnerships that support the cutting-edge research and development needed to remain at the forefront of global innovation.
The economy will not be the only beneficiary, because innovation is an enabler for every one of our national missions. Take artificial intelligence. Today, the UK ranks third in the world for AI talent, start-ups and inward investment. If you go to the so-called Knowledge Quarter—or, as some people call it, the new square mile—in King’s Cross, you can see what those statistics look like in reality. Sandwiched between the station and the Francis Crick Institute—Europe’s largest biomedical laboratory—a new crop of companies is growing out of the coal drops from which Britain’s first Industrial Revolution was born. Goldman Sachs estimates that AI could double the rate of growth since 2010—but that is just part of the picture. Many of the businesses there are harnessing the power of AI to discover solutions to some of our most pressing social and environmental problems.
This is not some distant future. Noble Lords will know that industry is already feeling the impact of the rapid development of large language models. Technologies such AlphaFold, developed by DeepMind, have shown the transformative effect that AI can have. By predicting the shape of almost every protein in the human body, AlphaFold has ushered in a step change in the understanding of disease and the measures we need to tackle it. We can expect to see more examples like this. This is not an opportunity that we can afford to miss. From breast cancer screening and stroke detection to fraud prevention and personalised education, this Government are committed to harnessing the power of AI to transform how we deliver public services and boost living standards right across the country.
To do this, we must champion our domestic science and tech sector; and, in a country where 25% of people struggle to engage with the internet and digital devices and 2.1 million people live largely offline, we must remain relentlessly focused on driving up digital skills to ensure that the opportunities of our modern economy are open to all.
We must also lead by example by delivering modern digital government that promotes the responsible and innovative use of technologies, with public services that are more productive, less time-consuming and, frankly, more in tune with how we live our lives. The public sector must walk the walk as well as talk the talk. My department, as the centre for digital expertise and delivery, has been tasked with making that happen.
None of that, of course, is possible without data. We have committed to creating a national data library that will make it easier to access data, deliver data-driven public services, support research and create opportunities for economic growth, while maintaining strong safeguards. These principles also underpin the new digital information and smart data Bill. Putting digital verification schemes, the National Underground Asset Register and smart data schemes on a statutory footing will accelerate research, innovation, investment and productivity. Improved data sharing and standards will make public services more efficient and accessible. In all of this, we will prioritise protecting people’s data. We will modernise the Information Commissioner’s Office and give it new, stronger powers; and we will introduce reforms to data laws to address the uncertainty that prevents the safe development and deployment of new technologies.
We cannot seize the opportunities of innovation without getting regulation right. Regulators must be equipped to deal with the pace at which new technologies are developing, particularly when they cut across traditional industries and sectors, as they increasingly do. In 2022, more than two-fifths of businesses said that regulation was an obstacle to success. That is why we are establishing a regulatory innovation office. By enhancing regulatory innovation to update rules, speed up approval timelines and co-ordinate issues that span existing boundaries, the office will transform the journey that new technologies take—out of the lab, on to the market and into our lives.
Trust is a central part of this journey. That is why we will bring forward highly targeted legislation to introduce binding regulations on the handful of companies that are developing the most powerful AI models. Ending the regulatory uncertainty for AI in the UK will strengthen public trust, enhance security and boost business confidence.
Nowhere are security risks more apparent than in cyberattacks. In light of last week’s global IT outage caused by a failed software update, ensuring that our digital systems are safe and resilient feels more important than ever. In the last 18 months, we have seen devastating cyberattacks at the Ministry of Defence, the Royal Mail and the British Library. A recent attack on the NHS resulted in thousands of appointments and elective procedures being postponed, impacting health provision right across the capital. The CEO of our National Cyber Security Centre, Felicity Oswald, said earlier this year that these are risks that we cannot afford to ignore. I am sure noble Lords will agree. To reduce the damage from further attacks, we must urgently update our cybersecurity regulations. That is what the cyber security and resilience Bill will do, strengthening our defences and ensuring that digital services that are more essential than ever are protected.
His Majesty’s gracious Speech has set out an ambitious long-term strategy to unlock Britain’s potential. To deliver sustained growth that will bring prosperity and opportunity to every British person we must build strong and secure foundations anchored in an unwavering commitment to fiscal responsibility and rooted in advances in science and technology. With those foundations, the work of immediate change can begin. From employment rights and regulation to infrastructure and investment, our reforms will rebuild Britain’s economy. By combining discovery and delivery, opportunity and security, we will fix our broken public services and make lives better for British people.
Lord Callanan (Con)
My Lords, I welcome the noble Lord, Lord Vallance, to the Dispatch Box and congratulate him on his maiden speech. Almost all of us have made a maiden speech in this House and some of us have also spoken from the Dispatch Box, but few of us have made our maiden speeches at the Dispatch Box. It is a nerve-wracking thing to do and those who have done it will have been impressed by the noble Lord’s coolness and humour—what we old Brussels hands would call his sang-froid.
The noble Lord, Lord Vallance, was a reassuring presence on our television screens during the pandemic. He was calm, informed and, not least, neutral and impartial. Of course, he has now given up that neutrality and impartiality, becoming the latest in a long line of public officials to join Labour—what I believe is known in Whitehall as “doing a Sue Gray”. Let me say that over the seven years that I spent in government, covering three departments, I worked with many fantastic officials whose neutrality I never had cause to doubt. I know from talking to many of these officials that many senior civil servants are uneasy, to put it mildly, about how easily some of their ex-colleagues become party political the moment they leave the service—although, in fairness, not Sue Gray, who became party political before she left the Civil Service.
I seem to remember the noble Lord, as Chief Scientific Adviser, recommending that Britain restore lockdown measures in December 2021, a call echoed at the time by the Labour Party. Luckily, those calls were ignored and in the event SAGE’s alarmist predictions of up to 6,000 more Covid deaths per day were shown to be utter nonsense. It was a moment that comes very rarely in politics, when two alternative policies can be tested against events. One of them was shown to be nonsense. There will doubtless be times when we revisit these moments across the Dispatch Box. For now, I welcome him and wish him well in the important job that he is undertaking on behalf of the Government.
Lord Callanan (Con)
My Lords, let me to this unusually full gracious Speech—bulging, we might almost call it—which contained a great many measures. Your Lordships are going to be kept very busy indeed because, given the size of the Government’s majority in the other place, I am not sure that there will be much critical scrutiny happening. However, like everyone else in this House, I am sure, I really do want Britain to succeed. That means that we want the Government to succeed. We on these Benches will support any measure that advances the goals which we share—above all, the Government’s stated priority of boosting economic growth.
We know what brings growth. It is sound money—I was pleased to hear the noble Lord’s commitment to sound finance—a balanced budget, competitive taxes, a strong private sector, light but effective regulations, public services that deliver for those who need them, a world-class education system and free trade. Almost all of us can agree on those things, but delivering them means making tough choices rather than just talking about tough choices. Only yesterday, we heard the new Chancellor hinting that she would roll over at the first signs of militancy from the public sector trade unions. That “tough choices” rhetoric lasted all of a fortnight. Labour has promised not to raise taxes on working people, and that is good. Let us see how it works out in practice. The pandemic, even without the extra lockdown, pushed taxes to the limit. Bringing them down is a vital part of any growth strategy.
It is worth observing in passing that all taxes are, one way or another, paid by working people. A corporation no more pays corporation tax than your TV set pays its own licence fee. A bank no more pays the bank levy than your house pays council tax. All taxes are paid by human beings—whether directly or as employees, suppliers or customers. When taxes on savings or inheritance go up, the money, ultimately, always comes from working people.
Can we please be spared the tired cliché of, “Oh, dear, we’ve looked at the books, and things are worse than we thought”? It is worth reminding ourselves of the figures; the last time Labour left office, in 2010, employment was at 70.4%; now, when Labour returns, the figure has risen to 74.4%. Labour bequeathed the Conservatives 7.8% unemployment; the Conservatives are bequeathing Labour 4.4%. When my party took over, the deficit stood at 10.3%; as we leave, despite the pandemic and the energy crisis, it is 3.1%. Let us please not have any nonsense about uniquely difficult legacies or about things being worse than expected. According to the OECD, which has just upgraded its growth predictions, things are better than expected and Britain is outperforming every major European economy.
The question before us is: will the measures flagged up in the King’s Speech lift burdens from our productive sector or, indeed, pile them higher? Let us consider some of them; first, the Budget Responsibility Bill. The Conservative Government established the Office for Budget Responsibility in 2010 after seeing what happens when borrowing is pushed up. Its job was to provide independent analysis of the UK’s public finances; at the time, Gordon Brown had left us with a deficit forecast to rise to 11.8%. Now, to repeat, the deficit is 4.4% and is forecast to fall to 1.2% in five years’ time. But is it really for quangos to determine our fiscal policy? Is it not, in the end, the job of our elected colleagues, primarily in another place? There needs to be a balance, and I am not sure that granting ever more powers to the OBR gets that balance right. After all, who holds the OBR to account when, as frequently happens, it gets its advice wrong? I have no doubt that criticisms will be made of fiscal policy in the years ahead, but they should be made, in the first instance, in this Parliament.
As for the national wealth fund Bill, its name skates fairly close to breaking the Trade Descriptions Act. It does not create a sovereign wealth fund. Indeed, it is far from clear what it will do that is not already covered by the UK Infrastructure Bank or the British Business Bank that were both established and capitalised by the previous Government, and which are up and running and already investing in the green industries of tomorrow.
I was delighted to hear of the Government’s commitment to planning reform and new infrastructure, as we need both. This is not new: I was part of a ministerial working group in the previous Government trying to work on reducing those delays. I hope noble Lords opposite will not mind if I share one observation based on that experience: the only way to get things built quickly is to hack through the thickets of, first, judicial review and, secondly, excessive environmental regulation. We will see what Labour makes of those tough choices.
Taking tough decisions is not the same thing as talking about those tough decisions. Noble Lords opposite will remember opposing an amendment to the then Levelling-up and Regeneration Bill that would have unlocked 100,000 new homes, and Labour so far has been silent on whether it will use the powers in the Levelling-up and Regeneration Act to reform those bureaucratic EU legacy laws, environmental impact assessments and strategic environmental assessments. If it does, we will, of course, support it, but I predict that unless these particularly difficult issues are tackled—and they are difficult—we will not see infrastructure being built any faster.
The noble Lord referred to the employment rights Bill. I understand that some trade unions think that they hold IOUs for the financial largesse bestowed on Labour to pay for the election campaign, but the most basic employment right is the right to be employed in the first place, something that is ensured by our flexible labour laws.
The Blair Government understood this, which is why they opposed the EU’s attempts at the time to enforce job-destroying legislation on the UK. When I was an MEP, I was happy to work alongside the then Labour Ministers and Government to mitigate some of the worst effects. How sad it is to see Britain, outside the EU, about to adopt unilaterally that which the Blair Government opposed when we were still a member of the EU.
Businesses are already sounding alarm bells, warning against French-style trade union laws. Alex Baldock, the head of Currys, Matthew Percival, a director at the CBI, Rupert Soames, its president, and Archie Norman, chairman of M&S, are among the business leaders warning of unintended consequences and a loss of investment if we go ahead. There is no point in having generous workers’ rights if we have fewer and fewer workers in the first place. If we adopt French-style labour laws, nobody should be at all surprised if we end up with French levels of unemployment.
But I promised to be positive—
Lord Callanan (Con)
—about worthwhile reforms and I am delighted to see the audit reform and corporate governance Bill in the gracious Speech. I oversaw a development of these proposals when I was a BEIS Minister but, unfortunately, I failed at the time to persuade No. 10 that they mattered enough to make the legislative programme. It is good to see them back and I welcome them.
The lockdown is now three years ago and the global financial crisis is but a distant memory. The last of post-Covid inflation has ended, the deficit is falling, we are close to full employment and there is every reason to be optimistic about the future. If Labour can deliver on what it promised, grow the economy, tread more lightly and, over time, bring taxes down, it will have the support of this Front Bench.
Lord Fox (LD)
My Lords, it is with great pleasure that I welcome the Ministers to their new positions and congratulate the noble Lord, Lord Vallance, on his excellent maiden speech. I have to say that I am having to readjust; I spent so long looking opposite and finding the noble Lord, Lord Callanan, arguing. However, it is good to see that, in crossing the Chamber, he has lost none of his customary charm.
After years of an out-of-touch Conservative Government who took people for granted and left so many things needing to be done, this King’s Speech is very much being portrayed by the Government as a start to putting things right. The people who voted either Labour or Liberal Democrat crave these changes, so we welcome the intentions articulated in this King’s Speech and agree that the commitment to uniting the country is vital.
Given the paradoxically marginal nature of the Government’s overwhelming majority, unification should come, wherever possible, by reaching across the aisles. We have to reach agreement and work for the stability that we all crave. These Benches will work with the Government where we can to help deliver the changes that our voters so eloquently articulated, in that election.
I will focus briefly on stability, investment, infrastructure and skills, and leave it to others to talk about the important need to better facilitate trade with the European Union, and some technology issues.
The Government have quite rightly made growth their primary objective, and recognise that stability is needed to create the ground on which this can flourish. With the Budget Responsibility Bill, the Government are seeking to anchor economic responsibility into law. This is the anti-Liz Truss Bill and we look forward to the debate when it comes.
However, stability is more than just a law. Stability is projected by how the Government behave, how they make decisions and how they co-operate in the public and private spheres. That is where stability will come, so we very much welcome the news of a statutory industrial strategy council to oversee industrial policy.
At the same time, this King’s Speech tacks very much towards bigger government, with state intervention on energy, transport and planning. As I am sure Ministers opposite recognise, success will depend on getting the balance of government involvement right because, in the end, it is private investment that will deliver the growth that we need. For all the potential money in the national wealth fund, meaningful growth will come only if private investment flows. Unlocking that flow of investment is absolutely crucial.
Given we already have a UK Infrastructure Bank and the British Business Bank, and the Government say that they will start by operating through one of these anyway, I would be grateful if the Minister can explain why a third institution is needed to focus what is going on. Can the Minister say what, typically, will the national wealth fund be used for? How will its investments be decided? Will decisions be purely commercial or will strategic issues be included? Will the fund take stakes in businesses? How will those stakes be used—passively or actively?
As we have heard, infrastructure is crucial to delivering growth. To date, much of the commentary around the planning and infrastructure Bill has focused on housing. Of course housing is vital, but when it comes to national productivity it is going to be transport, energy and digital infrastructure that will drive that productivity.
Past Governments have made similar, perhaps less ambitious, plans to tackle the infrastructure challenges we face, but inevitably there is a big time lag before things start to happen. For all the talk of shovel-ready projects, these are few and far between. Ironically, the one shovel-ready project with a proven positive effect on national productivity is the northern leg of HS2, which the Government seem to have decided not to revive. Perhaps the Minister can explain why.
On a wider point, the Government’s planning proposals will be challenging to put in place, and we believe that planning must properly involve in some way the communities it affects. The delivery of big infrastructure projects is also an issue, as I am sure all of us in your Lordships’ House note. It was surprising that the Government decided not to give the National Infrastructure Commission a statutory role in overseeing national projects. Can the Minister explain how the commission, the UK Infrastructure Bank and the national wealth fund will work together, first in the creation of the long-term plan that was discussed during Questions today and then to improve project delivery once these projects are undertaken?
Finally, I turn to skills. The central question I have on the whole government agenda is: for all the Government’s targets, who will lay the bricks, insulate the houses and bring the electricity grid into the modern era? The Skills England Bill seems to lack urgency. Can the Minister explain the timetable for the development of both a plan for skills in this country and its implementation? When will we see any effect from it on the actual workforce?
In coming from the cafeteria today I caught sight of the Prime Minister talking about a migration strategy around skills. It seems clear that, at least in the short term, a sector-based migration strategy will be needed. It would be helpful if the Minister could explain what the Prime Minister was talking about.
I have one other quick win for the Government: they could turn the apprenticeship levy into a wider, more flexible skills levy straight away. We do not need consultation. Everybody who comments on this knows that this is what needs to happen, so why not do it now, and start the process of retraining a broader group of people? There is money left over from the apprenticeship levy that is not being used for skills.
It remains for me only to repeat that uniting the country requires a broad approach to deliver both benefits and stability across our country. We on these Benches will engage positively in all the discussions from this King’s Speech and beyond to assist in delivering the stability that this country needs.
Lord Morse (CB)
My Lords, I thank the noble Lord, Lord Fox, and warmly welcome the noble Lord, Lord Vallance, to this House and congratulate him on his brilliant maiden speech. I apologise for my husky voice, by the way—there is nothing I can do about it.
It is encouraging to see the new Government putting sustained economic growth at the top of the agenda. Not many would disagree, but the key issue will be how the Government go about putting their objectives into effect, and how they respond when things do not work according to plan. I will explore this in two contexts: how do we strengthen the attractiveness of the UK as an investment target, and how do we reinforce the appetite of UK business to invest and grow?
International investor confidence in the UK has traditionally been high, because we were seen as sound and stable, both fiscally and constitutionally. This has taken a bit of a shaking in recent years. Proposals in the King’s Speech for fiscal discipline will help rebuild this in large part, provided that the Government are robust in maintaining that discipline when challenges come—as come they will, and the markets will be watching. We also need to show that the UK has a strong sense of shared responsibility across the political divide, and a stable relationship between the courts and government, which again has lapsed a bit recently.
I turn to UK business and its confidence to invest and grow. A great deal will depend on businesses’ assessment of the risk in doing so over the medium term. A planned five-year stability in the corporation tax rates will help provide confidence, provided this apparent stability is not undermined by hidden taxes on business, such as might occur as part of the planned business rates reform. Equally, a shared industrial strategy can help provide business with a stable planning and decision-making background, provided that the industrial strategy council does not turn out to be a way of cramming government and trade union views down on business. It is also very important that it is not seen as a way of taking somewhat out-of-date solutions, such as nationalisation, and bringing them back into effect. The Government really need to not get hung up on any of these outdated solutions, and to be agile and quick to adapt if they are not working.
Some of the planned reforms may be more difficult to implement than is anticipated. Take the example of the reform of employment law; it would not be surprising if one unwanted result of these changes was a reluctance by employers to recruit because the new employment rights will make it harder for them to let staff go if the business finds itself in trouble. How agile and realistic will the Government be when they face these sorts of difficulties?
Finally, the Government have committed to speak honestly about the issues that this country faces. Are they being honest in the proposed changes to the defined pension rules? Most large UK pension funds have a global portfolio of investments; this spreads the risk and improves investment returns for pensioners. If these funds were pressured into investing a predetermined amount of their portfolio in the UK, this would be unlikely to represent an improvement for pension beneficiaries. In fact, let us be honest, it would probably provide something useful for the Government in their growth policy objectives, and put benefits to pensioners under threat. The Government will need to walk the talk when it comes to honesty and openness—they need to work on that very impressively.
If the new Government succeed in creating an effective partnership with UK business, where UK business feels heard and that its need for stability is understood and provided for, they will have achieved something really valuable and done much to build growth. If we manage to make the UK a more attractive investment target again, we will all benefit from that. I offer my best wishes to this new Government, and wish for their success in the national interest.
The Lord Bishop of Leeds
My Lords, I am not an economist, but I care deeply about the economy. I shall limit myself to a couple of observations, and I am sure that I can save a few minutes in the length of the debate.
First, I welcome the Minister and thank him for his illuminating and articulate speech. I admire the new Government’s ambitions, but I worry a bit that there is too much. Holding all this together in a coherent development framework will be challenging beyond words, but I wish the Government well in doing it.
I want to plead for honesty from the Government and a good communication strategy to explain to the rest of us in the country who are not economists how all this is going to be rolled out. When it fails—elements will fail for a host of reasons, not usually intentional—the Government must trust the electorate and tell us the truth. When timelines do not work and get delayed, trust us and tell us the truth so that we know what is going on. We need to be treated like adults. I understand the need to adhere to the fiscal rules, but the Government choose what those rules are, so if they have implications for the rest of us, that needs to be explained clearly in language that can be understood by people like me.
What I am glad about in the gracious Speech is that we seem to have a programme that takes long-termism seriously. I hope that can be stayed with during this very ambitious programme, where the immediate will sometimes compromise the longer term. We need long-term thinking. I speak as someone who lives in the north of England and who has to use transport north and south but also east and west. The problems that we have with rail were mentioned earlier. The amount of money that has been invested in London and the south is light years above what has been invested in the north so far. I wonder whether the northern powerhouse is turning into a northern small battery, but that is to be seen.
There are a number of issues in relation to employment that really impact us in the north. Universities—I am familiar with a number in west Yorkshire—are now struggling and making people redundant, because we do not have students coming in from abroad. I know that raises questions about the models for investing in students, but we can talk about creating employment at the same time as we are losing employment in significant areas. One of the factors involved in that is access to good communications, especially rail and road. I came to this House 10 years ago, and I remember saying at the time that only way effectively you can get from east to west and from west to east is along one road, the M62. There is nothing else. What happens to the north-east when the A66 is snowed under, I suspect even in the summer? The rail links are appalling, whatever investment has gone in. I now have to get my PA to book trains north-south to get down here, knowing that if my train is cancelled I can get the one before or the one after and still get here for what I need to be here for. That is terrible in a country like this.
What about the issues we have with water? The failed experiment of the past 40 years, where pockets of individuals have benefited from much of our privatised utilities, needs to be addressed. I read the other day—I cannot remember the numbers—that the CEO and the CFO of Yorkshire Water have received more than £500,000 in bonuses. I work in a business that does not quite understand bonuses, because I do not get a salary, I get a stipend, but I always thought that a bonus was there to reward going beyond what you are employed to do. So why are people getting bonuses for abject failure where the money goes into the pockets of shareholders at the expense of consumers? This is a moral issue as well as an economic issue. I hope that the Government will address this as they go forward.
So I come back to where I began and say that I admire the ambition, but we have to be careful that we do not lose it as we go.
Baroness Drake (Lab)
My Lords, I declare my interest as a trustee of DB—defined benefit—and master trust pension schemes.
The Government’s mission to deliver sustained economic growth conveys an energy and purpose that I truly believe the country needs. Investment in the UK has been too low. The perception of government instability has made Britain a less attractive place to invest in. Restoration of good governance and stability of policy will be integral to increasing that investment.
Reinvigorating our capital markets is triggering a review of our pensions industry, now worth over £2 trillion. Some £1.2 trillion is in closed DB schemes. Consequent to auto-enrolment, there is projected to be £800 billion or more in DC—defined contribution—schemes by 2030. Private DC may overtake DB pension savings within 10 years; more so if the statutory minimum auto-enrolment contributions are increased.
That reality raises major issues of policy as to the appropriate governance and regulation applied to those private savings, which are supported by £50 billion plus per annum in different forms of tax relief. The pensions sector is a major allocator of capital, which can negatively affect the efficiency of the wholesale financial markets, markets that are key to driving innovation and investment in our economy. We have deep savings pools, yet reduction in investment in the UK.
Closure of DB schemes led to a focus on guaranteed long-term cash flow away from growth investments, as increasingly beneficiaries became pensioners in payment. Now we see scale buyouts of DB schemes to insurers. The regulatory focus on the DC pension sector’s ability to deliver best value for millions of individual savers is gaining momentum.
Both improving the outcomes for UK citizens saving for retirement and achieving sustainable economic growth requires a clear journey plan. The pension sector’s role as a major allocator of capital will come increasingly from defined contribution schemes and the £360 billion in the local government pension scheme.
The need to identify and address the barriers to pension schemes investing more in UK productive assets is captured in the first stage of the Government’s overarching pensions review.
DC private pension provision is not a normal market; the demand side is driven by a public policy of harnessing employees’ inertia and compelling employers. The investment risk is borne by the individual saver, and their interests cannot be overridden, but structural reform to achieve greater consolidation in the market is needed to secure the essential benefits of scale to enable larger schemes to deliver higher returns for savers and invest more in UK productive assets.
The Government need to incentivise a quicker pace of consolidation in the market and create the right investment environment to secure better outcomes for both savers and the economy. The many millions of inactive small pension pots, arising when workers leave their employer, need to be addressed. Previous Governments knew that this was a growing problem, increasing costs and inhibiting illiquid investments, but they have not acted. The Government’s move to automatically consolidate these small pots is much needed.
When it comes to retirement, our citizens are not well supported in making the complex decisions about how to access those savings over their retired lives—a problem not only for individuals but for public good outcomes—so it is good news that the Government intend to require trustees of pension schemes to offer people retirement income solutions or a default option when they stop work, not just to hand over a pot of savings.
The UK economy faces a world of innovation in sciences and technology where other leading economies are investing heavily in infrastructure and the industries of the future. Securing a deep science and technology base is essential to our economic prosperity. Annual investment in energy globally rose to £2.4 trillion in 2022, with approximately three-quarters of that growth attributed to low-carbon technologies. In the UK, the technology sector is less than 5% of our total market capitalisation.
Public investment where it supports and de-risks additional private investment is being deployed successfully across the world. The creation of a national wealth fund and investable opportunities, with the target of attracting £3 of private investment for every £1 of public investment, is an important move. Yes, it may be a modest start, but it is an essential one in order to get the investment this country needs to achieve sustainable economic growth.
Lord Forsyth of Drumlean (Con)
My Lords, I congratulate the Benches opposite on the general election result and the Prime Minister on a famous victory, albeit that he secured half a million votes fewer than he did when campaigning to make Jeremy Corbyn Prime Minister.
The gracious Speech talks about a mission for growth and security. Indeed, listening to the Chancellor yesterday on the BBC, I was impressed by her determination to maintain control on public expenditure and achieve growth in the economy. The noble Lord, Lord Vallance, whom I congratulate on his speech and his appointment to this House, emphasised that and even quoted Karl Popper, who is of course famous for the theory of falsification.
I congratulate the noble Lord, Lord Livermore, who served on the Economic Affairs Committee. I am sure he will do a fantastic job at the Treasury as he copes with the disastrous debt consequences of lockdowns carried out without any impact assessment and funded by conjuring £400 billion out of thin air, with disastrous consequences in inflation and the cost of living crisis with which we are all now grappling.
The gracious Speech itself was positively Orwellian in its use of doublethink. For example, we are told that the Government are going to tackle the housing crisis—indeed, a Minister said earlier that she would end homelessness—yet the gracious Speech will prevent flat owners being able to gain control of their property, which will simply reduce supply, push up rents and make more people homeless.
Within days of taking office, the Minister—against the advice of his officials, we read in the newspapers—decided that all new licences for prospecting in the North Sea would be cancelled, affecting £30 billion of investment and 200,000 jobs.
Letting employees choose when and where they work is also in the gracious Speech. I am sure it is very popular to say that, but it is disastrous for growth and productivity. The only growth that will bring is in daytime TV audience figures.
Then there is taking desperately needed capital away from public services, such as the health services and local government, to create Great British Energy and renationalise the railways. Is there a shortage of investment in energy? Yes, if the Government have their way and cancel those licences. There is plenty of private capital, and public capital is desperately needed.
Making it pretty well impossible to dismiss poor performers—and, as a result, to take on untried young starters—will not help with productivity or help small businesses, which will reduce their rate of expansion and be lumbered with costs in coping with these measures.
Lastly, the Government are contracting out the Chancellor’s job—I thought they were against contracting out—to the OBR. It is a quango, a bunch of civil servants whose record on forecasting is abysmal. Even this month they underestimated the debt, which they thought would be £11.6 billion; it turns out to be £14.6 billion. That difference is more than twice what they hope to raise by putting VAT on school fees. The doublethink in that matter is in the gracious Speech, which says that the Government want to
“raise standards in education and promote children’s wellbeing”.
What, by taxing education? They will be the first Government in the world to tax education, forcing young children to leave their schools as their parents cannot bear the burden of that tax. What a disgraceful policy—and about the only one that Labour articulated during the general election.
I congratulate the Liberal Democrats on highlighting social care throughout the election campaign. There is not a mention of it in the gracious Speech, yet it is central to solving the problems of the health service and local government financing.
According to “Panorama”, Ministers say they want to restore trust in politics—but not with this King’s Speech. It reminds me of those lines from The Jungle Book:
“Dreaming of deeds that we mean to do,
All complete, in a minute or two—
Something noble and grand and good,
Won by merely wishing we could”.
Lord Clement-Jones (LD)
My Lords, I refer to my interests in the register. I join in congratulating all the new Government Ministers and Whips on their appointments. As the DSIT spokesperson on these Benches, I give a particularly warm welcome to the noble Lord, Lord Vallance of Balham, and his excellent maiden speech. While he was the Government’s Chief Scientific Adviser, he was pivotal in setting up the Vaccine Taskforce and in organising the overall strategy for the UK’s development and distribution of Covid-19 vaccines, and we should all be eternally grateful for that.
I warmly welcome the noble Baroness, Lady Jones of Whitchurch, to her role. We have worked well together outside and then inside this House, and I very much want to constructively engage with both Ministers on the Government’s science and technology agenda. I also thank the noble Viscount, Lord Camrose, for his engagement when in the department, and for his courtesy and good humour throughout.
I welcome the Government’s agenda for growth through innovation, their mission to enhance public services through the deployment of new technology and DSIT’s central role in that, opening up what can be a blocked pipeline all the way from R&D to commercialisation—from university spin-out through start-up to scale-up and IPO. Crowding in and de-risking private investment through the national wealth fund, the British Business Bank and post-Mansion House pension reforms is crucial. Digital skills and digital literacy are also crucial but, to deploy digital tools successfully, we need a pipeline of creative critical thinking and collaboration skills as well.
In this context, I very much welcome the new Government’s tone on the value of universities, long-term financial settlements and resetting relations with Europe. I hope this means that we shall soon see whether spending plans for government R&D expenditure by 2030 and 2035 match their words. Disproportionately high overseas researcher visa costs must be lowered, as the noble Lord, Lord Vallance, knows.
But support for innovation should not be unconditional or at any cost, and I hope this Government will not fall into the trap of viewing regulation as necessarily the enemy of innovation. I therefore hope that the reference to AI legislation, but the failure to announce a Bill, is a mere timing issue. Perhaps we can hear later what the Government’s intention is in this respect. Before then, we are promised a product safety and metrology Bill, which could require alignment of AI-driven products with the EU AI Act. This seems to be putting the cart well in front of the regulatory horse.
We need to ensure that high-risk systems are mandated to adopt international ethical and safety standards. We all need to establish very clearly that generative AI systems need licences to ingest copyright material for training purposes, just as Mumsnet and the New York Times are asserting, and that there is an obligation of transparency in the use of datasets and original content. The Government in particular should lead the way in ensuring that there is a high level of transparency and opportunity for redress when algorithmic and automated systems are used in the public sector, and I commend my forthcoming Private Member’s Bill to them.
As regards the Bills in the King’s Speech, I look forward to seeing the details, but the digital information and smart data Bill seems to be heading in the right direction in the areas covered. I hope that other than a few clarifications, especially in research and on the constitution of the Information Commissioner’s Office, we are not going to exhume some of the worst areas of the old DPDI Bill, and that we have ditched the idea of a Brexit-EU divergence dividend by the watering down of so many data subjects’ rights. Will the Government give a firm commitment to safeguard our data adequacy with the EU? I hope that they will confirm that the intent of the reinstated digital verification provisions is not to have some form of compulsory national digital ID, but the creation of a genuine market in digital ID providers that give a choice to the citizen. I hope also that, in the course of that Bill, Ministers will meet LinesearchbeforeUdig and provide us all with much greater clarity around the proposals for the national underground asset register.
As for the cyber security and resilience Bill, events of recent days have demonstrated the need for cybersecurity, but have also made it clear that we are not just talking about threats from bad actors. There needs to be a rethink on critical national infrastructure such as cloud services and software, which are now essential public utilities.
Finally, I hope that we will see a long-awaited amendment of the Computer Misuse Act to include a statutory public defence, as called for by CyberUp, which was recommended by the Vallance report, as I recall. I very much hope that there will be no more Horizon scandals. I look forward to the Minister’s reply.
Lord Kakkar (CB)
My Lords, I join other noble Lords in congratulating the noble Lord, Lord Vallance of Balham, on his excellent maiden speech and the very thoughtful way in which he has introduced today’s debate. In so doing, I remind noble Lords of my own interest—in particular, that I am chairman of King’s Health Partners, UK Biobank and the Office for Strategic Coordination of Health Research, as well as serving as chancellor of the University of Lincoln.
In opening this debate, the noble Lord identified the importance of science and innovation to so many elements of His Majesty’s Government’s current agenda. The mission agenda ensures that the impact of economic growth benefits citizens as quickly as possible. Among the different domains and disciplines of science, life sciences play a particularly important role in providing the opportunity not only for substantial wealth creation in the economy but for substantial health gain, as the product of life sciences innovation is applied to practice in the NHS and, most importantly, to preventing ill health.
The Minister identified a number of potential hurdles that need to be overcome to ensure that the life sciences industry in our country and the broader ecosystem can progress at a rate that can make a meaningful impact. He mentioned the need for the development of new infrastructure and to secure growth funding to allow spin-outs and small-stage companies to develop at the pace that will provide maximal opportunity.
There are four other important areas that require very careful and immediate attention from His Majesty’s Government if the true potential of life sciences in our country is to be realised. I would be grateful if the Minister who will close the debate—my noble friend Lord Livermore—might be able to reflect on what approach His Majesty’s Government are going to take.
First, there is the question of free movement of scientists into our country and, in particular, the visa regime that is currently employed and the ease with which it can be used to encourage brilliant scientists to come and settle here and contribute not only to work in our universities but in the broader life sciences sector.
Secondly, there is the question of securing the research science base in our universities. Regrettably, that has been eroded over time. QR funding and full economic cost recovery have not been achieved appropriately for many years, and now charities and other funders of research find it very difficult to ensure that brilliant research programmes can be applied. We all recognise that overseas student income is a fundamental part of the university business model, to underwrite the opportunity for the science base in our universities. There is uncertainty about the future of large numbers of overseas students coming to our country, and His Majesty’s Government will need to address urgently the approach to securing the research base in our universities, which is critical not only to creating the talent that will service the life sciences sector but to securing the intellectual base of many of our research-led universities.
The third area is ensuring that the NHS, under substantial pressure to ensure clinical delivery, does not miss the opportunity to play its vital role in life sciences research and development. We must have a strategy to develop clinical academics, so that this part of the overall workforce continues to be nurtured and we have sufficient clinical academics able to serve and provide the opportunity for clinical translation and the rapid application of innovation to improve human health and outcomes in our National Health Service. This is particularly important since ill health is now such a drag on the economy and therefore, in addition to many other measures, innovation delivered through academic medicine will be vital to overcome that problem.
The final area that needs to be urgently addressed, as the Minister—my noble friend Lord Vallance—identified himself in his maiden speech, is the question of data. It is one thing to talk about or focus on the technological advances that will provide federated platforms for the use of the substantial datasets that we have available in our country, quite unique in the world; it is quite another to secure the social licence that will ensure that there is broad public support for the use of those data to drive forward the life sciences research agenda. Will the Minister comment on the approach that His Majesty’s Government propose to take to establish that social licence?
Viscount Stansgate (Lab)
My Lords, I am very glad to contribute to today’s debate, although it is always a challenge to follow the formidable knowledge of the noble Lord, Lord Kakkar.
This is the first time I have spoken at the beginning of a new Parliament, and from this side of the House. Indeed, in this House, the rearrangement of the seating is the only definite proof that an election has in fact taken place. We now have a Government who have placed science and innovation at the very heart of their economic strategy, which is the subject of today’s debate. The appointment of my noble friend the Minister is the clearest evidence of the seriousness of this commitment. It is a wonderful appointment and he is a very welcome addition to this House. He joins a select group of Members whose maiden speech and first ministerial speech, which was excellent, turn out to be one and the same. I also hope the House will allow me to say that in a previous capacity, when for decades I organised many of the major events involving science and Parliament in the Palace of Westminster, he always took part in these events, no matter how busy he was—and as the Government’s Chief Scientific Adviser, he was very busy. He made the time to talk to younger scientists and engineers and to encourage them in their careers and to take part in public life. I am sure he will continue to do so as a Minister.
I welcome the new language now being used to describe our future relationship with Europe on science, not just the progress being made on Horizon Europe, which was the subject of my first ever Oral Question, and such initiatives as greater youth mobility within Europe and our possible reintegration with the Erasmus scheme, but above all on re-establishing trust, so that the UK can be considered a reliable partner again when it comes to science and research.
I am sure the Minister will agree that as we develop renewable energy, the fact remains that the UK will still need strategic access to energy when it happens that the wind does not blow and the sun does not shine. We are going to need a strategic energy reserve. The Science and Technology Committee, of which I am a member, recently published our report Long-duration Energy Storage, and gave it the subtitle Get on with It. This was for a reason, because there is little time to lose. I hope the new Minister will be able to make progress and take advantage of any forthcoming changes in planning laws.
There are also new opportunities for the future that we simply must not miss, such as in engineering biology. It is a transformative technology, already acknowledged as one of the five critical technologies of the future, and I hope the House will have the opportunity to debate some of these exciting new opportunities in the future.
If the Government want science and innovation to pave the way for greater economic growth, it is going to require the greatest investment to unlock this potential. We need to reach the target R&D spend of our major competitor nations, alongside the development of a long-term industrial strategy that provides the stable framework for investment in science. As a country, we have a great reputation for scientific innovation yet, at the same time, a poor record for exploiting the innovation for the benefit of our economy, leaving it too often to other countries to exploit it commercially. In the decade of national renewal that lies ahead, I very much hope the Government and the new Minister of Science will succeed in reversing this dismal pattern. If we can dispense with the scientific phrase “valley of death” once and for all, that would be very good progress.
However, this is not just a debate about what the Government do. It is vital that Parliament has strong links with the science community outside the House, getting access to the widest range of advice as possible, and that Parliament fully supports the machinery that connects science to Parliament. A major part of this connection is the Parliamentary and Scientific Committee, which is by far Parliament’s oldest all-party parliamentary group; it dates back to 1939 when Parliament realised it needed to keep in active contact with the boffins—a term of endearment in those days—from whom much was expected and delivered in the Second World War.
Over the past 85 years, the P&SC has guided Parliament on science issues and helped to educate generations of parliamentarians on the importance of science, technology, engineering and innovation. I am its current president—there are no financial interests, but it is in the register—and with the defeat of our chair in the general election, I now have the responsibility of getting it restarted. If I may use Hansard as a publisher, I invite as many of my colleagues as possible, in this place and another place, to Committee Room 4A at 12 noon on Tuesday 30 July for the inaugural meeting. Without this meeting, all the work planned cannot go ahead. It is to Parliament’s benefit that it should have access to the widest possible science advice. I commend that approach to the House.
Lord Heseltine (Con)
My Lords, it is with some trepidation that I follow the noble Viscount, Lord Stansgate. It is some time since, in another place, I suffered under the lash of his distinguished father, but I learned my trade the hard way and I am delighted to see him in full flow.
I congratulate the Minister on his maiden speech; it was a formidable tour de force and historic analysis of what is wrong with this country. It was well prepared and well polished, but no one should really be surprised because we have heard it from the Front Benches opposite for generation after generation. It is all about the problems of this country and our history and what they intend to do about it, but what they intend to do about it is a very pale part of the speech.
I will give noble Lords just two examples, the first being the skills agency the Prime Minister has talked about today. I was in the other House when we created the Manpower Services Commission. This is just another national quango set up by government for government, centrally to impose policies on somebody else. Look at the skills agenda.
I appreciate the compulsion that Ministers and people on the Opposition Benches feel to lash out at regulation. I was responsible for deregulation, now 20 years ago. I published every one, 3,000 of them. I wrote to every trade association, “I’m your man. Tell me the changes you want. Here is the codicil; give me the examples of change you want”. I did not get one single reply. Why? It is because regulation is about the quality of civilised life in our country. It is about the environment, health, safety and a whole range of other issues which politicians trespass upon with care.
There is no greater example—if I may say, a lacuna in the Minister’s speech—than Brexit. We have had Brexiteers up to our ears over the last eight years. Where are all the regulations that were holding us back? Did they not prepare the case? Did they not have an agenda when they set up a department called the ministry of Brexit exiting? Was there not someone there who had a list? Of course not. What is now the story? It is, “We were never given the chance; we haven’t had time. Give us more time”. I think the Minister missed an opportunity in not explaining the damage that Brexit has done and how this Government intend to do something about it.
I want to make a third point: this country is dramatically unlike any other advanced economy. It is top-down dominated. Spending departments, functionally divided, have branch offices in the local authorities. By circular means of one sort or another, they are controlling influences thinking about their functional activities. For what we need today, one has to go back to when I was first in another place, to the Redcliffe-Maud report of 1969. Some 1,300 local authorities became 300; that is broadly where we are today. The Redcliffe-Maud recommendation was for 60 unitary authorities.
We have made massive changes, such as the Labour Government with the mayoralty of London. My noble friend Lord O’Neill, with George Osborne, was deeply involved in the process of introducing mayoral authorities—he is going to speak today. We made massive change. We now have mayoral authorities in the great conurbations of England, governing half of our country. Did the Minister mention the other half—the rest of England? No.
The proposal is simple: we need unitary authorities and an incentive for local people to prepare their plans. They have already done it in the local enterprise partnerships; they are all there in the documentation, ready to go. Where is the money to come from? Of course, there is no new money, but there are buckets of money in the capital programmes now allocated to local government.
The Government should do what George Osborne did and top-slice off it. He did £2 billion a year over six years: £12 billion. That should compare with the new growth fund that the Government are talking about, of £7 billion over five years. It looks like half of what George Osborne did; in just money value, it is about a third of what he did. The money is there if you top-slice it and make local mayoral authorities bid on the basis of plans locally designed by industry, academia and the public sector as to how to make their 60 local economies more effective. That option is available today to the Government, and I can think of no good reason why they do not set the process alight.
Lord Liddle (Lab)
My Lords, it is a great privilege to follow the noble Lord, Lord Heseltine. He is the Opposition—Conservative—politician I most admire. There was much of what I agree with in his speech. If his type of Conservative Party had governed this country for the last 14 years, we would be in a hell of a lot better place than we are today.
I also welcome our Ministers to the Front Bench. I was sorry that the noble Lord, Lord Callanan, made an implied attack on the independence and integrity of the noble Lord, Lord Vallance, while he was a civil servant. He brings enormously valuable expertise in fields which are vital to Britain’s long-term future. It was a great appointment, and it was a great maiden speech in this House. Of course, to succeed, he has to have the backing of the Treasury. There is no better person than the noble Lord, Lord Livermore, to make sure that he has it.
I also congratulate the noble Lord, Lord Hendy, who is not speaking in this debate but answered Questions very well today. I can think of literally no one better than Peter to sort out the mess that our present railway system is in and provide us with the first-class transport infrastructure that has so often been promised but never delivered.
The Government are right to stress the awfulness of their inheritance. The self-congratulation of the party opposite about how good things are ignores the fact that we have a very serious long-term productivity problem and that our public finances are in a hell of a mess. We have a very big current deficit, and that is based on the previous Government’s projections for public spending, which are unrealistic and unattainable. Many looming challenges have not been accounted for—public sector pay, social care, financial strains on local councils, and the 2.5% defence target—and that is before one mentions the existential questions of demography that face our welfare and health systems. Labour is absolutely right to put growth at the centre of its programme.
There can be no return to sustained growth unless we raise considerably our levels of public and private investment to match those of our main competitors. Yet I am afraid that the plans that Labour inherits from the previous Government see a reduction in public investment from something like 2.5% of GDP to 1.9% over the course of this Parliament. There is something in the argument that we can fill that gap by attracting private sector investment pension funds, which my noble colleague spoke about, and the stability that we offer is obviously a key part of what may deliver a higher level of investment from the private sector. However, we also need a commitment to the national wealth fund and British national energy, because that will facilitate partnership between the public and private sectors to de-risk investment projects. I am all in favour of this, but I will make just a couple of points in conclusion.
The sums may sound big but compared to the scale of the challenges of reconfiguring the national grid, launching a nuclear energy programme, investing in our railway infrastructure, et cetera, they are not that big. The key is whether we can convince the markets that, by borrowing to invest in growth, we can get a bigger public investment to match private investment. Here, I am concerned about the present Treasury rules that the previous Government put in place. As I understand it, they insist that the total cost of public/private finance projects is counted as a public debt liability on the grounds that the risk is ultimately borne by the public sector. I think the potential benefits of that investment adding to economic growth should be taken into account, as of course it is growth that would reduce the ratio of debt to national income. The question of how we generate public investment to match private investment is one of the crucial questions that this Government have to face.
Baroness Bonham-Carter of Yarnbury (LD)
My Lords, I join other noble Lords in thanking the Minister, the noble Lord, Lord Vallance, for his opening and maiden speech. I welcome him to his new role.
Throughout Labour’s campaign it emphasised economic growth, as has the Minister today. Central to this are the creative industries. I speak on DCMS matters—I think I am the first person so far to come to this area, but I see many around the House who will do so. I hope that the noble Lord who is summing up will address the points that we bring up, because in a sense we are shoehorned into this debate.
Today, I will concentrate on the economic contributions of arts and culture, and the best way to encourage and harness them. The national wealth fund Bill aims for every £1 of public investment to raise £3 from the private sector. This is something the creative industries have demonstrated they can do—see how creative industry tax credits contribute to GVA growth.
Another example is the BBC. For every £1 of its R&D, it contributes £5 to £9 in value for the economy. It seems that we are entering a happier time for our PSBs. How wonderful it was to hear Lisa Nandy, the new Secretary of State for DCMS, speak out so unequivocally in support of the BBC. Sanity has returned. She recognised in particular the importance of the World Service, as well as what the BBC provides for our children. Sadly, the Media Bill found itself mired in the wash-up. The Reithian principles—to inform, educate and entertain—were saved, but a clear definition of genres, rather than the vague term “appropriate”, did not make it into the Bill, nor did addressing the powers of Ofcom. I hope the Minister is open to revisiting these issues, as well as to funding the World Service from the FCDO budget.
Education was covered last week, and we support everything that was said about the importance of returning arts and culture to the centre of the curriculum, something since pledged by the Education Secretary, Bridget Phillipson. These are more happy tidings, but essential ones. Creative education’s decline is now almost at crisis point in England’s state schools, according to a report published today by the Campaign for the Arts and Warwick University. We on these Benches believe that Ofsted should give outstanding ratings only to schools that can demonstrate excellence in the provision of creative subjects. I hope the Minister agrees.
We welcome the Skills England Bill, as mentioned by my noble friend Lord Fox, and reform of the apprenticeship levy, but this must work for the creative industries. There is a lack of diversity within the creative workforce. Changes to the levy and to the education system will help to address this, but much more needs to be done. The creative industries are a world of freelancers. The UK’s tax and social security framework is not set up to support them effectively. What is needed is a freelance commissioner.
Finally, there is the calamitous consequence of Brexit across the creative sector, with the inability to access the continent, and complicated paperwork—carnets, cabotage and visas—inflicting punishing costs and red tape. Our young people are being cut off from European culture. We must pursue visa waivers, negotiate a return to Erasmus+ and apply to participate fully in Creative Europe. I hope this new Government agree.
The value of arts and culture is not just economic; they are at the heart of what brings us together as families, communities and friends, helping to combat loneliness, alleviate pain and bring solace to those dealing with physical or mental health problems. As I heard Chris Bryant MP, the Minister of State for DCMS and DSIT, say last week, they allow us to walk in other people’s footsteps—an aptly poetic use of words. Please do not do as recent Governments have and treat the DCMS as a Cinderella department. Put culture and the arts, and not just the money-making industries that they create, centre stage, as previous Labour Governments have. Embrace the legacy of Jennie Lee and Chris Smith—the noble Lord, Lord Smith—and harness them. There is a real power to creativity that is not linear, which is what makes it so special: James Dyson went to art school; Rio Ferdinand trained as a ballet dancer.
I end–as a Liberal, I have to–with John Maynard Keynes, creator of the Arts Council and of course a great economist. His vision was reaffirmed last week, almost 80 years on, by the present ACE chair, Nick Serota, who urged the Government to
“remember and reaffirm the value of the arm’s-length principle, which, by maintaining the political independence of arts funding, protects artistic freedom”.
Lord Vaux of Harrowden (CB)
My Lords, I add my warm welcome to the Minister, both to this House and to his new position, and congratulate him on his excellent maiden speech.
I welcome the new Government’s focus on economic growth and stability, as so many others have done, and indeed many of the other steps proposed in the gracious Speech. The debate today covers an enormous range of topics, so I will concentrate on just a couple of areas—one could go on for hours.
I was very excited when I first heard about the proposed national wealth fund. I assumed we would be talking about a sovereign wealth fund similar to those we see in other countries such as Norway. Sadly, this will be a rather less ambitious entity. In effect, it will be just a £7.3 billion extension to the UK Infrastructure Bank’s existing catalytic activities. That is a not a bad thing—indeed, it is a good thing—but I had hoped the new Government might dispense with some of the overselling we have seen in the recent past. It is a disappointment.
The wealth fund will apparently generate £3 of private sector capital for every £1 of public money invested—a good aim, but easier said than done. There is a real danger that, if not executed well, public investment can actually have the negative impact of crowding out private investment, simply replacing private capital that would have been available otherwise.
We debated that concern at length during the passage of what became the UK Infrastructure Bank Act—I see the noble Baroness, Lady Noakes, looking at me—and I urge the Minister to go back to those debates and consider very carefully what was said when designing this fund. Exactly the same issues apply, in particular the importance of genuine operational independence—this should not be just a plaything of the Treasury—and of measuring and reporting on the crowding-in performance. I do not mean measuring the amount of investment made—anyone can spend money—but measuring the actual crowding-in impact that is achieved.
The gracious Speech also includes the strengthening of employment rights. Again, this includes some good things: practices such as the egregious fire and rehire actions carried out so appallingly by P&O need to be stamped out. But we also need to be very careful about the possibility of unintended consequences, as others have mentioned: well-intended changes could end up hurting the very people they are intended to help. I will give two examples.
The first is the equalisation of the minimum wage for younger people. I do not think it was in the gracious Speech, but it has been quite heavily trailed. It has obvious superficial attractions, but that all-important first step on to the employment ladder is already very difficult: 28.3% of 16 and 17 year-olds are currently unemployed. We must encourage employers to take on young people who have no experience. Why would an employer take that risk if they can hire someone with experience for the same cost?
Secondly, I am deeply concerned about removing the two-year period before a claim of unfair dismissal can be made. We should be encouraging employers to take risks in employing people such as those without experience, young people in their first job, people changing careers or older people looking for a job post redundancy. The noble Lord, Lord Timpson, whose appointment I think was inspired, has an admirable track record of employing ex-offenders. We should encourage others to do the same. But this change will make employers, especially smaller businesses, think twice. It may—and probably will—discourage them from taking on people they might see as greater risk, and a probationary period, which the Government talk about, is not the same thing. I am not aware of any evidence of material abuse of the two-year rule. Protections already exist from day one for a wide range of automatically unfair issues. So I urge the Government to listen carefully to businesses, especially smaller employers, before taking such a potentially damaging step.
As we are only allowed to speak on one day, I will briefly raise a matter that might fit better in Wednesday’s debate. It is—predictably—fraud and economic crime. It is relevant today because the high levels of fraud and economic crime that we experience in this country are a genuine brake on growth. I was surprised to see nothing in the gracious Speech addressing this. There are plenty of steps that need to be taken, especially the incentivising of tech platforms and telecoms operators to take action to prevent fraud. I do not believe the Government have yet appointed a replacement for the previous Government’s fraud champion. Could the Minister tell us whether they intend to do that?
The other thing that stands out as missing from the gracious Speech is the whole question of productivity. We cannot have stable growth without improving our productivity. There is not time to discuss that in detail and I know that others will do so later, but it is something that the Government do need to address.
Overall, I welcome the Government’s focus on growth and stability and recognise many good proposals in the gracious Speech, but I urge the Government to tread very carefully to avoid unintended negative consequences and to listen constructively to the comments of businesses, particularly small businesses, before taking some of these steps.
Lord Wood of Anfield (Lab)
My Lords, I congratulate my noble friends Lord Vallance and Lord Livermore on their appointments. Like many, I have been a fan of the rigour and communication skills of my noble friend Lord Vallance from afar and look forward to having him as a colleague in the House. I am also delighted to see my noble friend Lord Livermore appointed as the new Financial Secretary, having worked with him for many years at the Treasury, where we were advisers to Gordon Brown. He has wide experience, possesses excellent judgment and, most importantly, knows what it is like to work for a demanding Chancellor.
We all know that the state of the UK economy is among the biggest challenges facing the new Government. Next year, Britain is forecast by the OECD to be the poorest-performing G7 country for growth. Real wages are only just back to their 2008 level. Borrowing continues to come in higher than OBR predictions. Productivity remains very poor in international comparison. Meanwhile, taxes are at their highest since 1948 and our public services are creaking under the strain of years of austerity. I know that I am biased, but it is refreshing to see a Labour Government looking at not just the short-term but the long-term root causes of our economic poor performance, as many noble Lords have said—the myriad of problems on the supply side of the economy that hold back growth, productivity and wages.
I particularly want to applaud three proposals in the gracious Speech. The first is the planning and infrastructure Bill. Measures to reduce costs of compulsory purchase orders, reduce timeframes, streamline processes, modernise planning committees and increase local authority capacity all have the potential to make a big difference if co-ordinated properly. The second is the employment rights proposals. Contrary to other noble Lords, I think that they will help to ensure that the burden of economic adjustment in our country is no longer borne to an unfair degree by the least powerful and most vulnerable. The third is the banking resolution Bill, which will allow the FSCS to recover the funds provided to bail out the failing small bank by charging levies on the banking sector, similar to the current arrangements for funding depositor payouts in insolvency.
I want to mention two things in slightly more detail. First, I welcome the national wealth fund and the determination for a new approach to investment in green industry infrastructure and SME funding. It is good to see that the British Business Bank and UK Infrastructure Bank will be aligned under a new national wealth fund. I have a question for the Minister about it. The national wealth fund taskforce, which was commissioned by the then shadow Chancellor, Rachel Reeves, and reported to her as Chancellor, said that the money in the fund should not be allocated in grants but should be used to target riskier investments. Will that be the approach of the new national wealth fund?
In connection with my noble friend Lord Vaux’s point about the UK Infrastructure Bank, the bank did valuable work but it was criticised, including by the Public Accounts Committee, for reinventing the wheel for funding projects that already draw private capital. It will be interesting to hear what lessons the new national wealth fund will learn from the conservatism of that funding approach.
Secondly, on the pension proposals, many in this House have much more significant knowledge on this than I do, but we all know about the problems in the connection between UK pension funds and investment in the real economy of the UK. The average defined benefit allocation to UK equities has fallen from over 50% in the 1990s to less than 2% in 2022. Schroders data says that there are close to 27,000 defined contribution schemes in the UK—25,500 of which are micro schemes of fewer than 12 members. Therefore, the issue of scale and consolidation clearly is crucial, but I hope that the review and the legislation that comes out of it, which I welcome very strongly, will look at how the regulation of the pension fund industry connects to investment—levels and types—and whether other financial incentives might be appropriate to encourage more investment in UK equities and UK corporate bonds.
Lastly, I will return to a point that my noble friend Lord Liddle raised. It is so refreshing to see a Government putting partnership with the private sector at the heart of their policies. We have seen it in the last three weeks, and we saw it in opposition. Partnership is important not just for the legitimacy of policies, or because the private sector will ultimately be the determining factor in the success of a lot of government policies, but because in partnership we can shape the risk scenario that will be so important for encouraging more long-term investment.
Best wishes to my noble friends Lord Vallance and Lord Livermore. We look forward to what will come down the pipe in the next few years.
Lord McLoughlin (Con)
My Lords, I join other Members of your Lordships’ House in welcoming the noble Lord, Lord Vallance, to his position and congratulating him on his maiden speech, which opened this debate. I also welcome the noble Lord, Lord Hendy of Richmond Hill, to his post. He brings, without any doubt, an expertise in his subject that is probably equivalent to that of the noble Lord, Lord Vallance.
The noble Lord, Lord Hendy, has managed to travel from being first appointed by Ken Livingstone to being reappointed by Boris Johnson when he was Mayor of London, to being approved as chairman of Network Rail by David Cameron when I was Secretary of State for Transport and then being made Rail Minister by the present Prime Minister. He certainly knows how to travel the highways of political responsibility, and there is not much pressure on him to show that he has the answers to these problems.
I welcome certain parts of the King’s Speech. The preferences played, as far as transport is concerned, are vital. I meant to refer at the beginning to my interest as chairman of Transport for the North. The noble Lord, Lord Heseltine, talked about the way in which the metro mayors will become more important in shaping transport in their areas; that will be very important for the Government to deliver growth. I regret the decision that was made by the last Government on HS2—I think it was the wrong decision. We cannot have big national infrastructure projects in the planning for 15 years that are changed overnight, as HS2 was. A lot of thought went into that, and HS2 was not about speed; it was about capacity on the network.
That will be one of the big challenges. I noticed what the notes that come with the King’s Speech say about the high-speed rail Bill for Crewe and Nantwich:
“We are not reversing the decision to cancel the second Phase of HS2”.
That is a bit different to what was said at the time that decision was made from the now Government Benches, then the Opposition Benches. One only has to look at the impact that HS2 is already having around Birmingham to see the benefits it can bring as far as long-term development and growth are concerned. We need to see a rebalancing of the country from outside London. It is particularly important that we talk about Manchester, Leeds and Newcastle, and that we talk about interconnectivity between our great cities—it is not a matter of London or not. When I was Transport Secretary, I would go down to the south-west and people would ask, “What are you doing for the railways down here?”. I said that we were rebuilding Reading station, and they would look at me as if I had gone completely mad. It was a huge investment, but it was essential to improve the capacity around the throat into Paddington station, which was one of the big rail bottlenecks.
I wish the Government well in their transport policies. Privatisation of the railways—“franchisation” as it now is—brought huge benefits. The railways under government ownership were starved of finances because there are other priorities. There always will be other priorities: health, defence and education will take a stronger role than transport will. Before privatisation there were 700 million journeys a year on the railways; there were 1.8 billion the year before the pandemic—that was driven by partnership. I urge the Government to think very carefully about this. We just heard about partnership with the private sector. Franchising has basically failed over the last few years because of the pandemic, but please think of what resulted from getting that investment. Places such as St Pancras station, where you would not have wanted to spend five minutes, are now destinations in their own right. I urge the Government to think carefully and tread cautiously on this.
I fully support what they are saying and wanting to do on buses; a lot more work needs to be done. As with anything in transport, we can all set out great plans, but nobody knows greater than the noble Lord, Lord Hendy, about the difficulty of seeing such plans introduced. The trans-Pennine upgrade currently taking place will take 10 years. I wish the noble Lord and the Government luck with this because, to get growth, they have to get transport right.
Lord Palmer of Childs Hill (LD)
My Lords, I will concentrate on aspects of work and pensions that are in the gracious Speech and those that are sadly missing from it.
I hope that the Minister, not necessarily a Minister from work and pensions, gives some reassurance on plans to end the two-child benefit cap. Figures show that 100,000 more children were affected over the past year. I think it immoral, and the DWP has just published figures showing quite how damaging the impact is. I was slightly reassured this morning when I received a copy of a letter from Ministers in the Department for Work and Pensions, headed “child poverty strategy plan”—but it makes no mention whatever of the two-child benefit cap.
The last Government limited universal credit or child tax credit to a family’s first two children. Third and subsequent children born after April 2017 are not eligible. There are now 1.6 million disadvantaged children caught by this ill-advised cap. I suppose the aim was to reduce large families claiming benefit, but can the Government say whether this stopped us having larger families? I believe the intention was to deter poor families from having more children than they could afford. Is there any evidence that this cap succeeded?
It has certainly increased child poverty. Removal of the cap is the most effective way to get children out of poverty. About half the affected families have three children, while a fifth have five or more children. I hope the Government scrap the cap, which will help reduce child poverty at a stroke. The real answer is to remove the cap completely, because it is the children who suffer. On a technical point, will the Government develop a digital equivalent of the NCC1 paper form from the DWP?
Can the Minister comment on the plight of WASPI women? We call for the ombudsman’s recommendations to be implemented before the Government’s problem disappears through more deaths of the women affected. It is unfair for the Government to say that these women were told it was going to happen. We are told that they were thus forewarned, but many have no recollection of being told. How were they told that they were not going to get their pension when they thought they would? I am reminded of The Hitchhiker’s Guide to the Galaxy, when Arthur found the notice that he was meant to see displayed in the bottom of a locked filing cabinet in a disused lavatory. These women did not know that they were not going to receive this pension. There is no purpose in having an ombudsman if the Government pick and choose which decisions they abide by.
The King’s Speech includes a Bill on pension schemes. I look forward to examining it in due course. I hope that, in clear terms, it provides: a firm commitment to press ahead with the pensions dashboard described by the noble Baroness, Lady Drake, and not let it be subject to further delays; a firm commitment to implement the 2017 reforms to automatic enrolment, applying the 8% mandatory contribution from the first pound and enrolling from age 18 rather than 22, and to provide a timetable, given that the last Government said they would do so by the mid-2020s; and a timetable to increase mandatory contributions from 8% to a more realistic level such as 12%. Automatic enrolment is vital to millions of people on modest incomes and, without a big step forward, they will either retire poor or have to work beyond their ever-increasing pension age.
The Minister will have seen the latest research from the Institute for Fiscal Studies, which shows that the nation’s poorest pensioners have fallen behind other pensioners in the last decade. Although pension credit has been fully uprated, thousands of the poorest pensioners fail to claim what they are entitled to. Can the Minister tell us what further steps the Government will be taking to tackle non-take-up of pension credit, and in particular whether the department is making full use of local authority data on housing benefit claims by pensioners that could be used to support a pension credit claim. The data is already there.
The Labour manifesto did not mention the word “carer”—the noble Lord, Lord Forsyth, mentioned this—and neither did the King’s Speech. The Government need to remember that caring is not just about the social care sector but about the thousands of acts of unpaid care that happen every day. Finally, do the Government recognise their responsibilities to their people in a caring and civilised society?
Lord McNicol of West Kilbride (Lab)
My Lords, I will focus the short time I have on one of the starkest areas of contrast between the priorities of this new Labour Government as set out in the gracious Speech and those of the previous 14 years.
Contained within the first few lines of the King’s Speech briefing notes were the words:
“we will create a new industrial strategy”.
This industrial strategy has the opportunity to help our country to grow, flourish and deliver. On 4 July, the country faced a crossroads. The British people chose economic stability, with a plan for growth and a Government that look to the future. Over the course of the King’s Speech a series of ambitious plans to improve every aspect of the country were laid out—from energy to education and skills, from transport to the NHS. However, all these plans rest entirely on economic reform and growth. Breaking down the barriers to opportunity does not rest on education alone. The causes of crime cannot be tackled without economic recovery that creates jobs and opportunities. Put simply, our country’s future rests on economic stability and security, and a long-term industrial strategy will be the backbone that runs through that stability and security.
Greg Clark’s industrial strategy of 2017 was inherently decent; it was his Government and the then Prime Minister’s failure to deliver on that strategy that truly let the country down. We now have an opportunity to reverse that: to deliver an industrial strategy that not only stabilises and grows our economy but directly improves the lives of working people. The damaging churn of instability that came with the last Government’s short-term economic decision-making allowed our economy to enter a downward spiral of insecurity, as was ably outlined by my noble friend Lord Wood of Anfield. Yes, there were headwinds, but the Government did little to subvert them, and in a number of cases made them worse.
With a long-term industrial strategy underpinned by a council of experts, growth can begin to support and develop Britain’s economy. Our excellent university and research institutions, often let down by underfunding, will now have the opportunity to push our country forward. Our professional services, often long-suffering from a stop-start, chop-change approach, will now have the stability to underpin their planning. Our manufacturing sector can at last grow beyond the short-term economic failures that often let it down. Our creative industries, as was touched on earlier, can thrive—driving innovation and investment across our country.
We must be proactive and invest highly in our national infrastructure. That was clear from the King’s Speech. Labour will merge the NIC and the IPA to create NISTA—the national infrastructure and service transformation authority—a powerful body to promote a more co-ordinated infrastructure decision-making system. Labour will kick-start this large-scale vision and solidify our maximum potential with these institutions.
After austerity, the UK’s productivity flatlined at little more than 100 GDP per hour—a rate that has hardly increased in the last 14 years, as my noble friend Lord Vallance of Balham noted in his maiden speech when opening the debate. If productivity had increased at the same rate as under the previous Labour Government, it would be 25% higher. Now that change has finally come, we have an opportunity to build a better and fairer Britain that works for all citizens, with Labour working in partnership with business and trade unions. Was it not refreshing to hear in my noble friend’s opening speech the talk about potential, ambition and hope, in stark contrast to the mean-spirited speech of the noble Lord, Lord Callanan, from the Opposition Benches? It appears he has learned little from the election or the electorate.
Baroness Noakes (Con)
My Lords, in 2010 the outgoing Chief Secretary to the Treasury left a note for his successor saying there was no more money. Despite the massive challenges of the pandemic and the energy shock, we left office this month with a strong pound, low unemployment, on-target inflation and a growing economy. The Government now seem desperate to craft a disaster inheritance narrative, but it will not fool us and I hope that it will not fool the British people.
I want to focus on just two aspects of the gracious Speech: the changes to the Office for Budget Responsibility and the proposed national wealth fund, which will be based on the existing UK Infrastructure Bank and the British Business Bank. These bodies are part of a pattern of state bodies with considerable powers and considerable operational independence but weak accountability. The gracious Speech shows that the Government are planning many more public bodies. We can disagree on whether a large state is a good or a bad thing, but we ought to agree that effective parliamentary accountability is a good thing and an essential part of the total equation. I hope that the Government will commit to that as they bring forward their legislation.
The Government’s OBR Bill will give it more power to issue forecasts. At one level, this is just a bit of political pantomime designed to squeeze every last drop out of the fiscal drama of the Truss Administration. As ever, truth is the casualty in politics. The Bank of England’s culpability, not least in its negligent handling of the risks embedded in LDI strategies, has been forgotten because it does not fit the political narrative.
More substantively, the OBR is not particularly good at forecasting, as my noble friend Lord Forsyth pointed out. Its last appraisal of its own forecasting record was that it consistently overestimated economic growth and underestimated public debt. It has been no better at inflation forecasting than the Bank of England. The Government would have been wise to have sorted out the OBR’s core functions before granting additional powers.
The Government, with their worthy commitment to growth, will also discover that the OBR’s static, rather than dynamic, approach to modelling can be a constraint. The Chancellor’s pro-growth policies may not score fully in the OBR’s modelling, which will in turn constrain what her fiscal rules allow her to do. The Chancellor will then discover that the OBR calls the shots and, like all these independent public bodies, she cannot even get rid of the people until their terms of office expire.
My other topic is the national wealth fund, on which we have very little hard detail. The one thing that is clear is that it is not a wealth fund as commonly understood. It is miniscule by global standards, but more importantly it is not a focus for the investment of surplus national resources to maximise long-term financial returns.
Leaving aside the fact that we have no surplus financial resources at the moment, this fund will not be a long-term wealth maximiser if it is built on the foundations of the UK Infrastructure Bank and the British Business Bank, which incidentally are not banks as commonly understood. Those organisations are basically a home for the risks that the private sector does not want to take. The chorus of approval from the financial services industry for the national wealth fund was unsurprising; they could see a world of lower-risk investment and lending opening up. There is nothing wrong with taking risks if they are well managed, but high risks should be matched with high returns, and the financial objectives of the existing so-called banks are a long way from that. Indeed, both of them made losses in their last published accounts.
I will have a lot of questions on the national wealth fund when we eventually see the legislation, but today I ask the Minister, who I welcome to his new role at the Treasury, just one, building on a point made by the noble Lord, Lord Vaux. Will the activities of the national wealth fund be subject to the additionality principle? If not, how will the Government ensure that they crowd in private investment rather than crowding it out?
Lord Best (CB)
My Lords, the King’s Speech aligns the Government’s strategy for growth with reform of the planning system for housing and infrastructure. Acute shortages of accommodation, and consequent inflated prices and rents, not only present multiple health, social care and welfare burdens for the state, but hold back economic growth. As Professor Duncan Maclennan’s seminal analysis concluded last year,
“the housing market has a big impact on national productivity”.
This is not just a London problem. The Minister’s excellent maiden speech mentioned the cities of Oxford and Cambridge, for example. These may be attractive locations for international investors, but without anywhere for a workforce to live the investment has to go elsewhere. Further afield in Devon, where I declare my interest as chair of the Devon Housing Commission, public and private employers alike express exasperation that recruitment is impossible and Devon’s next generation are leaving the county, defeated by the lack of affordability and availability of a decent home.
Achieving housebuilding targets—1.5 million homes in five years—as well as funding important regeneration will be fiendishly difficult. As the Government prepare their planning and infrastructure Bill, perhaps I can offer some thoughts to the Chancellor for relatively cost-free ingredients to achieve the changes that will lead to stronger local economies.
First, the essential reform of planning must fit within a wider national housing and infrastructure strategy that provides the long-term vision and a road map for the way ahead. What about a statutory housing and infrastructure committee reporting to Parliament, modelled on the Climate Change Committee, which could formulate this strategy and monitor progress year by year?
Secondly, we must end our fated dependency on a handful of volume housebuilders. Instead, the Government should back social housing providers, which need some longer-term certainty over grants and rents to achieve their crucial role, and back the return of SME builders, which used to provide 40% of all new homes but now barely manage 9%.
Thirdly, the Government’s promise of 300 more planning staff is helpful, but we need to go further to restock the hugely depleted planning departments. The Government need to allow local authorities to recover, through developers’ fees, the full cost of an effective, speedy local planning service.
Fourthly, planners must be empowered to insist upon the kind of housing needed locally, not least the level of affordable homes, where so often promises by developers have been broken. Housebuilders must realise that the price they pay for land has to reflect their non-negotiable obligations.
Fifthly, to achieve quality of new development as well as quantity, the Government should use building regulations, not just planning advice, to require higher standards of accessibility and sustainability.
Sixthly, a big welcome for the new development corporations, with simplified compulsory purchase powers to take on not just
“a new generation of new towns”,
and “urban extensions”, but major strategic developments. These bodies can acquire the land, capture its uplift in value and implement a brilliant master plan.
Finally, at present the construction industry does not have the skills to tackle at scale either the new-build or the retrofit programmes that we need. Let us see the new Skills England agency overhauling the existing unfit training levy scheme for the construction industry.
With these relatively inexpensive reforms, I believe that planning, housing and infrastructure could indeed be the key to igniting economic growth and creating enhanced prosperity and productivity. I wish the Chancellor, as well as the new Ministers, every success in this endeavour.
Lord Petitgas (Con) (Maiden Speech)
My Lords, let me start by congratulating my fellow maiden speaker, the noble Lord, Lord Vallance of Balham, on an excellent maiden speech, which obviously sets up a hard act to follow. Already, as a commoner from Brittany, I must confess to a twinge of imposter syndrome as I stand here today. According to the House Library, which I completely trust, there is no record of a Frenchman in the peerage since the 13th century. For me, this truly is a case of reality exceeding fiction.
I am very grateful to my noble friends Lord Hill of Oareford, who unfortunately is absent, and Lord Johnson of Lainston for acting as my supporters back in March when I was introduced to your Lordships’ House. I have forgiven them—just—for lingering perhaps a little too long in front of Maclise’s magnificent canvases in the Royal Gallery. When de Gaulle came on a state visit in 1960, they were covered up to spare his blushes, but I got both barrels. I am also grateful for the outstanding work of the Library staff, who are every bit as efficient as the research unit of a global investment bank but with much better books, and to the doorkeepers and Black Rod, who have kept me on the straight and narrow since my introduction.
It was Bagehot who distinguished in Government the efficient from the dignified. I posit that this House unites both qualities. I believe that many countries would or should give their right arm for such an institution. The quality of debates today is astonishing, and of course we provide the long perspective; Edmund Burke’s arc of time is my personal inspiration, linking
“the dead, the living and the unborn”.
I was born in Nantes from Breton and Norman stock. My claim to being a bright student was skipping an academic year on account of being too rowdy and tall for my age. I was the first to go into business in a family of academics and fishermen. After a brief stint in the French Foreign Office, I joined SG Warburg in London, then spent 30 years at Morgan Stanley and ran global investment banking. From there, I went on to serve the former Prime Minister Mr Sunak as his chief business adviser. It is from this perspective that I will share three observations about the UK economy, before I get on to the growth dilemma.
First, let us stop talking the UK down. Our economic outlook stands out in the G7, bar the US. Growth has been coming back. I believe history will show that Mr Sunak and his Chancellor were starting to get the country back on a more than even keel. Secondly, the special relationship with the US is a massive asset as we move forward with the AI revolution. To quote Musk, outside the west coast the only other place to develop AI is the UK. We count four out of the top 10 universities. We totally outmatch Europe on technology and IP. Thirdly, I will concede—and I think it is true—that a clear political mandate typically should unlock fresh investment and economic momentum.
Let us be clear, though, that, as we have heard today, not everything is rosy. The number one issue is lacklustre growth and low productivity. We are not alone in the West—bar the US again. I therefore support this Government’s focus on growth, even though we will debate and are debating the best way to get there. The proposed top-down drive on housebuilding, industrial strategy and net-zero infrastructure may stir up the economy, but we should not forget that durable growth ultimately rests on a bottom-up liberal economic philosophy encouraging risk-taking, innovation and wealth creation.
When thinking about growth, I find it useful to go back to basics and the canonical three-factor equation of “investment x innovation x skills”. On investment, we are not short of capital, either foreign or domestic. In fact, my noble friend Lord Johnson of Lainston was formerly Minister for Investment, and last year the UK had its highest-ever FDI. The dilemma, as has been said today, is that neither UK plc nor our pensions are deployed enough in our economy. Let us keep up the reform momentum to unlock better returns for savers and deploy capital for growth.
On innovation, the second factor, we are not short of IP in healthcare or AI that gives us real edge in capturing the productivity upside, but we need to be strategic around government procurement, capital allocation for pensions and regulation. As for skills, perhaps noble Lords will forgive me if I do not go into too much technical detail and become a bit French and philosophical. In my view, happiness derives from an individual’s sense of autonomy and self-worth or dignity. The French economist Thomas Piketty is right, despite being Marxist, about capital taking the elevator while labour goes up the stairs. Inequality and imbalances in society need redressing. We certainly need more economic efficiency, but we also need social justice. This House is a place of balance, and it is a great honour as the first French Peer in 800 years to have the chance to serve here in the cause of my adopted home.
Lord Bridges of Headley (Con)
My Lords, it gives me great pleasure to welcome the noble Lord, Lord Vallance, who I am delighted to see on the Benches opposite—I welcome talent to this House—and my good noble friend Lord Petitgas. My noble friend and I have two things in common: we both worked in a profession that is only marginally more trusted than politics—that is, banking—and we both worked in No. 10 before elections. In my case it was in 1997; in his it was this year. In both cases not everything went according to plan. I remember former Prime Minister John Major being sent early in that election campaign to visit a Formula 1 factory, where he was placed in a car with no wheels on it. My noble friend will have singed in his mind that visit to the Titanic shipyard. He failed to mention that, as well as having a stellar career in banking, he is also a member of the Légion d’honneur. Now a Peer as well, he is the living embodiment of the entente cordiale. Cut him down the middle and he is absolutely red, white and blue. I am sure I am not alone in welcoming him to this House and looking forward to hearing many more excellent interventions like the one he has just made.
I remind the House of my interests as a shareholder of and an adviser to Banco Santander. I pay tribute to and congratulate the Labour Party on its win and wish it well for the future. Like everyone, I want to see economic growth. As my noble friend and other noble Lords have said, the question is how we get it.
Before I turn to the Government’s plan, let us look at the inheritance, which a number of Peers have spoken about. As my noble friends Lady Noakes and Lord Petitgas said, we must not talk things down. Inflation is at 2%, unemployment is at 4% and the economy is outstripping other G7 countries so far this year. That said, we also need to be very honest. Productivity growth is lethargic—others have mentioned this—economic inactivity has soared, so too has immigration, and taxes and debt are very high.
Looking ahead, according to the IMF today, GDP growth would need to be around 2.6% every fiscal year from 2025-26 for the Government to stabilise public debt by 2028-29 without extra tax rises or spending cuts. Obviously, one reason why taxes and debt have risen is thanks to the double whammy of Covid and then Ukraine, but there are other reasons that we need to be honest about, and I will highlight three.
First, for years we have seen the slow but steady spread of a mindset that the state is the solution to all our problems. This was turbocharged by quantitative easing, which my noble friend Lord Forsyth mentioned, giving the impression not just that Governments can act in the face of adversity but that they should.
Secondly, and related, we have seen a growth in the regulatory state. Good, simple, robust regulation is the bedrock of a competitive economy, as others have mentioned, but at the moment that balance is going wrong. We are sleepwalking into a regulated world where businesses are deterred from taking reasonable risks, and without risk there is no reward, little progress and low growth.
Thirdly, there is the failure to improve productivity, which others have mentioned. I want to cite one reason why this matters, which is how productivity is related to debt sustainability. Professor David Miles, a member of the OBR’s Budget Responsibility Committee, told the Economic Affairs Committee earlier this year that
“if productivity growth is barely positive over the next five years debt would be around £200 billion higher, some 7% of GDP, than the OBR central forecast of November 2023”.
This is the context of the gracious Speech—a Speech that contains rays of hope, such as reform of planning, but in my mind these are overshadowed by the growing dark clouds of the fiscal challenges we face. They are debt, defence and the need to rearm, demographics with an ageing population, and decarbonisation and the green transition. These challenges—the Ds—have been sitting in plain sight for several years. We have known for ages that difficult choices lie ahead and—I hate to say it—just like the previous Government, Labour has been silent about what it will do. Will it increase taxes or cut spending? If taxes on working people are not to rise and wealth creation is really going to be rewarded, what is going to give? To govern is to choose—we know this—so do we prioritise rearming our nation or decarbonising it? Above all, do we encourage people to take more responsibility for their lives when faced with these challenges or do we look to the state to do more? It is the age-old choice: trust the people or trust the state?
The gracious Speech, with its commitments for more regulation and intervention, gave me just a glimpse and a whiff of the Government’s instinct. It is to trust the state, not the people. I do not think we should exaggerate this. It is not as if we are going to be on the road to serfdom, but my fear is that the growth we are likely to see will be growth in spending and tax, regulation and the state. If that is right, I cannot see how the Government’s approach will achieve their laudable aim of the UK having the highest sustained economic growth in the G7. So, while I wish this Labour Government well, I have a nagging concern that their plan will not put a brake on the spread of today’s big state malaise, which I see as holding Britain back. My fear is that the reverse is the case. To coin a phrase that the Government used about their gracious Speech, the brakes are off.
Lord Woodley (Lab)
My Lords, it was a tremendous pleasure to listen to the maiden speeches of the noble Lords, Lord Vallance and Lord Petitgas. I learned a lot from their lifetime experiences, which are very interesting. I am delighted to follow the noble Lord, Lord Bridges, in making my contribution.
Like many of us here, I am truly excited about the agenda for positive change laid out in our manifesto and in the King’s Speech, but it will not come as a surprise to your Lordships to hear that, of all the desperately needed legislation in this Session, I am most passionate about the employment rights Bill. I have been an active trade unionist for the whole of my working life, and it is a subject very close to my heart. There is nothing more precious to a trade unionist than employment rights. Employment rights are central to everything we do. They are our first and last lines of defence, and they are our bread and butter. They are the very tools of our trade. They are the beating heart of my party, the Labour Party—the clue is in its name—and should be a guiding light for this Labour Government in their mission to eradicate the twin evils of exploitation and destitution, which, sadly and shamefully, have only grown since our last Labour Prime Minister left office.
The employment rights Bill will bring to life our new deal for working people, a transformative programme to tackle the tremendous imbalance of power that currently exists in the workplace: day one rights to sick pay, parental leave and protection from unfair dismissal; an end to the exploitation and cruel insecurity that zero-hours contracts bring; the return of sectoral collective bargaining—or fair pay agreements, as they are better known—in the care sector, at least to start with, which are so badly needed; the repeal of the hated Tory anti-trade union legislation, from allowing the use of strike-breaking agency workers to minimum service levels and an awful lot more; and electronic balloting, enhancing union access to workplaces and cracking down on blacklisting. Each of these proposals would itself be a tremendous blow against workplace injustices; together, they are major upgrades in the fight against exploitation—and that is without even mentioning what I consider to be the jewel in the crown: a ban on the disgraceful, abusive practice of fire and rehire.
I wish to thank noble Lords again for their kind support during the last Session for my Private Member’s Bill, which sought to do exactly this. I was honoured—and I do mean honoured—to take my Bill through this House unopposed, with cross-party support, and from a shared understanding that we all benefit from strong protections against exploitation at work. Let us be clear: good employers—I have met many—have nothing to fear from this new deal. Quite the opposite is true; they have much to gain, because they will not need to worry about being undercut by unscrupulous employers slashing costs by exploiting their staff.
Well-paid and protected workers make good consumers, which can only be good and help the economy grow. However, with respect, it is naive to think that there will not be any pushback from big businesses. Bad bosses have already unleashed their lobbyists on a mission to water down these modest constraints on their power. I urge all noble Lords—not just those in my party but everyone who wants to see Britain become the best place in the world to work, as the last Government promised but predictably did not deliver—to stand up for these important measures against the inevitable attacks that they will face. Employment rights are human rights. We should all be proud to be part of a Parliament that will deliver such powerful, positive change for working people.
Lord Inglewood (Non-Afl)
My Lords, I begin like other Members of your Lordships’ House by congratulating the new Minister on his elegant maiden speech and welcoming the new Front Bench. I declare my interests as chair of the Cumbria Local Enterprise Partnership, which has just divested itself of its formal responsibilities to the local authorities and is now running itself down, and as a member of the Borderlands Economic Forum.
I would like to raise two points about aspects of the King’s Speech. First, regarding ownership of the railways, I am a subscriber to Alexander Pope’s proposition—not that he knew anything about railways—that:
“For forms of government let fools contest; whatever is best administered is best”.
I am also conscious of what I was told by the late Lord Kingsland, when electioneering with him: one of the golden rules of electioneering is that nobody ever lost votes knocking British Rail. My experience, like that of many noble Lords, is that we have all spent too much time going to the north of Britain on the railways. The test of whether it works will be whether we spend more or less time on the railways. It is a case of less is more. The House authorities ought to take an interest in this as, if it works, I suspect they will receive substantially less in rebates.
Secondly, I am not a fan of the Brexit settlement. On the evidence that I have seen in the north of England, it seems that it has damaged a lot of small and medium-sized businesses through the loss of markets; it is not only tariff barriers but non-tariff restrictions. I wish the Government well in trying to sort some of these things out, but I do not think it will be easy.
The functions of local enterprise partnerships have been transferred under the direction of local authorities. The key approach behind the LEPs, which is also the key approach of the new Government to economic development, is partnership. Sometimes it goes well and at other times less well, but it is important that, in looking at these things, we recognise that there is a clash between two cultures—that of local government and that of business—which are just as distinct as CP Snow’s two cultures of humanities and science. Look at the trailblazers—the big metropolitan areas where this has taken place—and you find that they have been working on this for many years, and have had at their disposal large resources from both the public and the private sectors. This contrasts importantly with what I might call “out of London”, which has fewer resources and, since the war probably, has lost what in Germany would be known as the “Mittelstand”, and with it much civic leadership outside the formal framework of politics and local government.
There are real potential problems of tension between the local authority culture and the business culture. It is important to recognise that business involvement is voluntary and costs businesses money, time and serious commitment. We must find ways of developing and harnessing arrangements that combine the business way of conducting its own affairs and delivering its own services and products with the local authority and public-sector codes of ethics, behaviour and appropriate accountability. If that is not achieved, it will not work. I recall a meeting of the NP11—the northern LEP chairs—where a very senior businessman concluded his remarks by saying, “And then the politicians will do what they do best: talk”. He then voted with his feet and left the organisation.
These things matter. In the case of Cumbria—although this is by no means confined to the county I know best—there are bad pockets of deprivation. The most important single thing we can do for such communities is to find ways of creating real, sustainable, properly paid work for those in them. That is the highest form of welfare.
Baroness O'Grady of Upper Holloway (Lab)
My Lords, I declare my interest as a former leader of the TUC. I congratulate the noble Lord, Lord Petitgas, on his maiden speech, and my noble friend Lord Vallance on an excellent speech setting out the Government’s programme.
I want to remind the House what is at stake. Around the world, one of the biggest threats to democracy is the rise of populism, or, more precisely, hard-right nationalism, which history teaches us can be a gateway drug to something even worse. While debate on populism is often dominated by immigration policy, tackling the economic conditions that give rise to it warrants urgent attention. The common patterns are clear and have been documented by researchers at the London School of Economics and others: high inequality, austerity and insecurity is the toxic combination that fuels the rise of a toxic politics.
According to a recent Joseph Rowntree Foundation report, wealth inequality is rocketing and outstrips income inequality. In the UK, the top 10% now owns a staggering 57% of total wealth. The impact of austerity on the public realm has been devastating. Public services matter, not just to keep the workforce healthy, educated and on the move, but for everyone’s security through life’s ups and downs, for our sense of a shared identity, and for our capacity to build safe and welcoming communities.
Another key indicator of countries at risk of populism is sustained pressure on living standards and the deregulation of labour markets. In the UK, that has led to mass insecurity at work. People look for scapegoats when they feel aggrieved and humiliated, and too many have lost faith in the ability of the political class to make their lives better. Labour has set out an economic programme to get the country back on its feet that should help to stem that tide. My hope is that, just as after the Second World War, we can build a broad consensus for the change that Labour is committed to delivering, with investment and strategic public ownership through Great British Energy, British Rail and a national wealth fund that will smooth the tough but necessary transition to a greener economy.
An active industrial strategy, boosting skills, housing and infrastructure, is vital to bring good jobs and new hope to the parts of the country that need it most. Whether growth will come fast enough to meet the scale of the challenge is a fair question. My own view is that we should choose to raise additional resources by shifting the burden of taxation from work to wealth. Tax experts calculate that taxing capital gains at the same rate as income would net the Treasury £12 billion a year, while restricting tax relief on pensions to the basic rate of income tax would raise a further £14.5 billion.
Labour market reform is necessary too. The P&O scandal and recent union-busting at Amazon are emblematic of working lives that leave too many people feeling frustrated, angry and powerless. Given the chance, this is the emotion that hard-right nationalist parties will seek to exploit. TUC-commissioned polls show that there is strong public support for the measures in Labour’s new deal, including from a majority of Conservative and Reform party voters. All the evidence shows that fair treatment, a stronger workers’ voice and good industrial relations can boost productivity and build a stronger society.
I am proud that this Labour Government understand, head and heart, the importance of the new deal to make work pay and restore dignity at work, and how in turn that can help to keep hard-right nationalism at bay. I hope that noble Lords across the House will recognise just what is at stake—not just fair growth and common decency but the democratic values that we hold dear.
Lord Frost (Con)
My Lords, I congratulate the Labour Party on its election victory, which I am afraid was well deserved. I welcome Ministers to the Front Bench, particularly the noble Lord, Lord Vallance; we former officials must stick together.
I listened carefully to the noble Lord’s presentation of government policy as set out in the gracious Speech. I heard that the mission was growth, but I heard little that was likely to deliver it. The planning proposals are obviously the main exception to that, and I wish the Government every success with them. I hope they use the reforms to build useful assets such as houses, roads and power stations, not white elephants like wind farms and solar arrays.
What I heard elsewhere was a plan to continue transforming Britain into a big-government, low-growth, low-energy, corporatist state—an alphabet soup of new bodies, plans and more Government-know-best policies. Just one example is the nice-sounding but, I am afraid, damaging reregulation of the employment market that the noble Lord, Lord Woodley, and others have spoken about: more mandatory pay-gap reporting, the rollback of trade union laws, the boost to the minimum wage, the end to zero-hours contracts, and so on. The Government claim in their briefing to us that the aim of all this is to ensure that
“industrial relations are based around good faith, negotiation and bargaining”.
We have seen what that means from the Chancellor’s remarks over the weekend: it means paying up for fear of the unions. I am afraid that if the Government are paying Danegeld already, two weeks into their term—that is, during the honeymoon—then they are going to have a tormented time in the next few years. Does the Minister—the noble Lord, Lord Livermore, who will wind up—have any assessment of the economic impact of these labour market measures? Can he explain why more regulation will boost productivity and growth?
Beyond that, we have a panoply of new corporate bodies: the Industrial Strategy Council, Skills England, and the new OBR, with its stronger legal status and even stronger powers to put its dead hand on to any attempt to create economic dynamism. We have more devolution, more incentives to local leaders to demand more money from the centre and more talking shops, such as the council of the nations and regions, with their local growth plans.
Above all, we have the so-called national wealth fund. I do not know whether the Government have noticed but we do not have quite as much wealth as we used to, thanks to the disastrous lockdown policy that others have referred to, and our debt is as high as our GDP nowadays. Yes, we have a plan: to borrow even more money and spend it on dubious projects that no one else will fund. We can all play that game: I can remortgage my own house, spend the money on a holiday and claim I have created my own sovereign wealth fund. It may make you feel good, but you would be crazy to think you had created any actual value as a result. So it will prove with this fund.
The product safety Bill deserves a lot more scrutiny than it has had so far, and I hope will get it. The government briefing tells us:
“This Bill will preserve the UK’s status as a global leader in product regulation”.
That sounds good, but read further down and you discover that it is designed to give the Government the power to follow EU regulations and keep Great Britain aligned with Northern Ireland and the EU as regards product regulation, which I have to say sounds a bit less like a global leader.
In passing, the briefing refers to a seemingly new body called “the Regulator”, with a capital R, whose nature and capacity is to be future-proofed by the Bill and which will
“provide national leadership on product safety”.
Could the Minister explain what that body is, how it differs from existing regulators and, more broadly, why he thinks that following the rules of the EU without any say in them is likely to help the economy of this country?
All these measures take us further from the only thing that actually creates growth—that is, free people making their own judgments and risking their own money in free markets. I am afraid that in due course the Government will discover this. Until we get back to that direction and until we start rolling back the corporatist collective state, we will continue to have a huge productivity and growth problem, and we will continue to disappoint the expectations of our people.
Lord Eatwell (Lab)
My Lords, as we learned from the gracious Speech, Labour’s plan for growth will be buttressed by the new Budget Responsibility Bill, ensuring that all significant tax and spending changes are subject to an independent assessment by the Office for Budget Responsibility. This poses an important question. The OBR was a child of austerity, a central actor in the disastrous austerity programme. How can an institution designed to validate austerity be part of a programme for growth?
In the uncertain world of economic policy-making the OBR is an important source of challenge to Treasury presumption, but far more important will be the design of the OBR’s own economic modelling and the consequent assessment criteria that it deploys. At its birth, this child of austerity focused on one number, the annual fiscal deficit. Whether £1 million of increased spending was designed to cut top-rate taxes or to fund investment in new infrastructure was irrelevant. That approach can be no part of a growth programme. It is bad economics because not all government spending is the same. Government spending may redistribute income, cutting taxes or raising pensions; it can be an investment in the nation’s productive capacity—spending on skills, for example—or it can be used to buy productive assets, acquiring equity in new technologies and industries.
The Chancellor stressed the economic importance of these distinctions in her Mais Lecture when she said that
“our fiscal rules differ from the government’s. Their borrowing rule, which targets the overall deficit rather than the current deficit, creates a clear incentive to cut investment … I reject that approach”.
She also said:
“I will also ask the OBR to report on the long-term impact of capital spending decisions … I will report on wider measures of public sector assets and liabilities … showing how the health of the public balance sheet is bolstered by good investment decisions”.
What would be the practical impact of this new approach on the OBR’s policing of the fiscal lock? Let us consider the practical example of Sure Start. In 2011, it was costing something over £2.5 billion in today’s money. Under the then OBR assessment, this was a cost that had to be cut. Yet an IFS study published just in April demonstrated that the benefits of Sure Start significantly exceeded the costs. The result of demolishing it has been a higher deficit and higher debt. When he sums up, will the Minister explain how the new rules of the fiscal lock, as set out in the Mais Lecture, would have been applied in the case of Sure Start?
A further blatant failing in recent OBR reports was the acceptance of the Treasury’s own numbers on future public spending, even if they were, as the chair of the OBR commented, “not even fiction”. These fantasy figures were the source of the conspiracy of silence—much referred to but little debated—during the general election. OBR assessments and the fiscal rules cannot be a meaningful source of stability if they are based on such fictions. Will the Minister tell the House what steps the Government are taking to ensure that the spending plans implicit in any OBR assessment are themselves evaluated against objective criteria?
The austerity-era fiscal rules that the OBR was obliged to apply constrained investment and stunted growth. The new fiscal rules, heralded in the Mais Lecture, prioritise growth and seek to minimise debt by maximising GDP. The OBR, austerity’s child but transformed by our Labour Chancellor into a vigorous and dynamic adult, provides the bedrock of stability for Labour’s growth strategy.
Lord Bradshaw (LD)
My Lords, in the time allowed I will concentrate on transport infrastructure. I completely reject the mantra of the Conservative Party that organisations such as British Rail were inefficient. I ran the west coast main line when over 90% of the trains arrived at the right time and almost without cancellations. These are the standards we need to get back to.
One of the big obstacles is the rail regulator, which has not only neglected its statutory duties but instead concentrated on promoting open-access competition. This concept is wasteful of capacity. It is estimated, for example, that 25% of the main line capacity on the east coast main line is used by five-coach trains to destinations served. These could instead be run as 10-carriage trains to Doncaster and York and split there. We need to use the available capacity on the east coast main line, which is very scarce, by running maximum-length trains. The ORR grants access rights without establishing that they are actually feasible, and it then protects them by law. This is why it has proved impossible to produce new timetables for the east coast main line. The Rail Regulator was part of the privatisation model imposed on the railways by the Railways Act 1993, which included compensation for delays imposed by other operators and by Network Rail—that is, the taxpayer. These mechanisms were identified by Keith Williams as a major source of cost inefficiency, which needs to be got rid of—this is vital.
We can use straight electric trains. We should go forward by announcing our intention, first—as my noble friend Lord Fox said—to maintain the proposed route of HS2 north of Birmingham. It will take a very long time to design and implement any alternative, and the capacity is needed urgently. I would announce the intention to electrify comprehensively the Midland main line when money is available, because it would use straight electric trains, which are more economical than the proposed hybrid trains now under construction. These should instead be used on cross-country services, which were shamefully neglected by the previous Government. Cross-country is a more suitable route for hybrid trains as the extremities are never likely to be electrified, but there is a lot of opportunity to use these trains in electric mode on core routes through places such as Birmingham and Doncaster. Such a move would bring fresh heart to the east Midlands, which is near the bottom of English regions for capital investment. This move would also bring the possibility of work for the Derby rail workshops.
The east coast main line has not seen an uplift in timings, and it is urgently necessary to cut half an hour off journey times between Edinburgh and London to provide an attractive alternative to air travel. A useful start would be made by eliminating capacity bottlenecks such as the flat crossing at Newark, by running at 140 mph and by completely revising the calling patterns on the route. It is essential that the timetable enhancements promised following the £4 billion investment in new trains are introduced soon.
Freight also needs attention. The Government have a modest list of infill schemes provided by the Chartered Institute of Logistics and Transport, amounting to 600 miles. This will improve connectivity, efficiency and decarbonisation. More energy needs to be spent on improving the route through Ely between the east coast ports and the rest of the network. I will stop there because I have run out of time.
The Lord Bishop of Newcastle
My Lords, I welcome the gracious Speech and the importance it places on economic growth. I congratulate the noble Lords, Lord Vallance and Lord Petitgas, on their excellent maiden speeches.
The Government’s bold articulation of fiscal reality, and the resistance to colluding with demands for short-term fixes, present a helpful foundation for next steps. One question is: when striving for growth, who will most feel its impact? The UK has some of the highest levels of geographic inequality in Europe. According to a survey conducted in 2022 by YouGov and the Resolution Foundation, 41% of those surveyed in the north-east felt that their region has generally declined in recent years—the highest out of any region in the UK. This feeling is not unfounded when real wages in half of the north-east’s local authorities are still below 2008 levels. The impact can be felt in take-home pay and on our high streets, and it is borne out in the investment decisions of businesses.
It is essential that the growth we strive for is for the UK in its entirety, with a particular focus on communities whose potential is not yet fully realised. I therefore welcome the emphasis this Government place on local economies, and I look forward to seeing increases in mayoral powers and local growth plans through the English devolution Bill. However, the responsibility of ensuring that everyone feels the benefits of growth should not rest solely with the Government but should be shared by us all. How can each sphere of society—businesses, charities and civic institutions—partner together so that the benefits of growth are felt more widely?
I would like to highlight the businesses and social enterprises that recognise that their success is bound up with the flourishing of the local communities that they serve. The Big River Bakery in the Shieldfield area of Newcastle is a terrific example of this very point; it is a bakery, shop, cafe, training space, and so much more—a sustainable commercial model partnering with external support, rooted in a deprived local community, and nurturing kindness and compassion in its mission to serve.
There is another bakery, founded in Newcastle in the 1950s. Today, that bakery can be found on high streets across the UK and took an 8.2% share of the UK’s food-to-go sales in 2023. I was one of the many who joined Greggs in celebrating National Sausage Roll Day last month by purchasing its limited-edition yard of sausage rolls. That is a lot of sausage rolls; other sausage roll makers are available. Greggs has experienced enormous growth as a business, but it continues to serve its communities, contributing a proportion of its profits towards the Greggs Foundation, which supports local community organisations and addresses issues of poverty and inequality by distributing upwards of £4 million in grants each year and establishing more than 800 breakfast clubs. An example of how profit and growth can be achieved, but through partnership, its impact goes further. How can our Government encourage greater partnership and social responsibility, so that more communities feel the benefits of growth?
It is clear that economic growth is the driving mission of this new Government. I believe that success will be measured by the fruits of growth. My hope is that we will work towards equitable and sustainable growth, achieved through partnership for the benefit of all.
Lord Monks (Lab)
My Lords, it is a real pleasure for me today to welcome the speech of the noble Lord, Lord Vallance, and welcome him to this House. It was a very interesting and inspiring speech in many ways. I also congratulate the noble Lord, Lord Petitgas, on his speech. While I am paying compliments, I will mention my fellow former TUC general secretary. We are developing our own union, and it is a real pleasure for us to be in a debate that is about pro-worker and pro-union legislation for the first time for very many years. When have debated these things in this House, it has always been the other way around, with the tide flowing against unions.
It was almost a rite of passage for successive Tory Governments to load new limits on to unions and to impose expensive red tape on many of our activities, complicating our lives and making it much more expensive to administer the unions. The Conservative Party recognised that anti-trade union legislation did not cost much—so you could say you were doing something—and through that gesture it pleased the party faithful. It cheered them up. But it was also a green light to corporate greed and excess in too many board rooms. As the union power faded, so the bad behaviour on the part of too many employers grew.
Positive employment legislation is not just for workers and unions; it is for better employers, too, as has already been said in this debate today. The better employers are scared about being undercut by the unscrupulous, and the new proposals will generate some much-needed levelling up in that area, as well as perhaps in other areas.
History provides some important lessons here. It was Stanley Baldwin, a Conservative Prime Minister in the 1920s and 1930s, who was concerned about excessive employer greed and rising inequality and decided to promote collective bargaining. We owe a great debt in the union world to what Stanley Baldwin did. If only his more recent successors had followed his example and shown the same degree of wisdom, the country would be in a better place. Collective bargaining will be encouraged by this Bill, and its revival is important to the nation’s future.
We all know that the Government must overcome a daunting set of problems. These include a fading industrial base and the continued shrinkage of world market share of many UK products and services. The gap between London and the south-east on the one hand and the other regions and nations of the UK on the other is getting worse. It is very difficult to bring them together more in the way that has been done in some other countries, between capital cities and the smaller and more remote areas. The hard truth is that at the moment areas of the UK resemble eastern Europe more than western European countries, and that is a big difference that we have to deal with. Levelling up will be hard, but it is important to try.
On employment relations, the employment Bill will be a very good thing for many reasons, but it could go a bit further. In the darkest years of the Second World War, Ernest Bevin, who was a union leader and became Minister of Labour and National Service, wrote a letter to the chairman of ICI. He was worried about constraints on output and the urgent need to boost production, and he suggested the establishment of a round table in workplaces that would discuss raising standards in both the quantity and the quality of the work being produced.
There was some follow-up in the form of joint production committees, but other countries were to take up that idea with much greater enthusiasm and adapt it to their own circumstances. In those countries, raising performance levels and market share became a joint mission. Skills, investment, good relations at work and respect became shared goals, whereas we were always a bit more confrontational and, despite valiant attempts, never quite managed to land that kind of culture. Let us remember that Theresa May dipped her toe in that water when she aired the concept of workers on boards, but that faded as she and her Government collapsed in the damaging aftermath of Brexit.
These are very good measures from the Government, and I am very pleased about them, but I hope that in due course they will go a bit further and promote our own version of a national partnership project. Other countries have managed to do it, and so can we.
Lord Mair (CB)
My Lords, I join other noble Lords in congratulating the noble Lords, Lord Livermore and Lord Vallance of Balham, on their appointments as Ministers. I also congratulate the noble Lord, Lord Vallance, on his excellent and important maiden speech—and the noble Lord, Lord Petitgas, on his maiden speech. The noble Lord, Lord Vallance, is especially welcome as Minister for Science. His very considerable expertise in science and technology is warmly welcomed in this House. The vital importance of science and technology was emphasised in His Majesty’s gracious Speech in relation to the Government’s plans for sustainable economic growth.
The absence of an industrial strategy in recent years has undoubtedly been problematic for this country. The new industrial strategy to be introduced by the Government is therefore very welcome, as is the proposed industrial strategy council, to be established on a statutory footing. It is to be hoped that this will result in a stable pipeline to enable industry and the UK’s world-renowned science and engineering research base to deliver innovations and provide confidence for businesses to thrive.
It is also to be hoped that the proposed new industrial strategy has real meaning. Much has been said about industrial strategies over many decades. In 2018, during a debate in this House, the noble Lord, Lord Hennessy, noted that the then formal industrial strategy set out in 2017 had been at least the eighth government industrial strategy to be published since the Second World War. A few years later, that industrial strategy too was abandoned, and from 2021 the previous Government instead pursued various other plans for growth. The establishment by this new Government of an industrial strategy council on a statutory footing should ensure continuity of an industrial strategy. It is continuity above all that is needed.
This country has an outstanding science and technology research base. To harness it most effectively the UK requires a robust and consistent strategy for industry and for universities, scrapping short-term funding and aiming for long-term stability. This is what is crucially needed to ensure economic growth.
My final point relates to employment and skills. There is a huge need for engineering skills to deliver the green and digital economies, adapting to the new, fast-moving technologies. These include the all-important AI, as so well articulated by the noble Lord, Lord Vallance, in his excellent maiden speech. At the heart of the Government’s agenda is making Britain a clean energy superpower, with zero-carbon electricity by 2030. The Government’s clean power mission plans major investments in wind and solar power, carbon capture and storage, hydrogen and marine energy, decarbonising the electricity system and long-term energy storage. Nuclear power will also be essential. All these important and welcome technologies will be vital for economic growth. All the associated innovations and required new infrastructure—the driving forces for the industrial strategy—will require many more engineers and technicians to be employed.
Employers are constantly referring to the acute national shortage of engineering skills; this is limiting the success of an industrial strategy or of an infrastructure strategy. There is a substantial untapped resource of future engineers and engineering apprentices in our schools. We need to address this urgently and plug the skills gap. Only then can the much-needed economic growth be realised.
Further education colleges have been neglected for far too long. I welcome the Government’s plan to transform FE colleges into specialist technical excellence colleges, as well as reforming the rather unsatisfactory apprenticeship levy, ideally as soon as possible. In addition to supporting our world-class universities, an enhanced future for apprentices, including degree apprenticeships, will be especially important if this country is to become truly a technological superpower.
Overall, I am optimistic for the future. I wish the new Government every success in their plans to enhance the UK’s position as a leading industrial nation, these plans being vitally underpinned by science and engineering.
Baroness Stowell of Beeston (Con)
My Lords, I am very pleased to congratulate the noble Lord, Lord Vallance, and welcome him to this House, and to congratulate his fellow Ministers on their new appointments to the Government Front Bench. I also congratulate my noble friend Lord Petitgas on his absolutely barnstorming maiden speech; he is going to be an excellent addition to our Benches and I am so pleased that I was in the Chamber to hear him
Today, I want to focus on the future—specifically, the role of generative AI in producing economic growth. As other noble Lords have said, the UK is among the world leaders in the development of this technology. Indeed, there has been a recent rush of inward investment. During just one week in May this year, CoreWeave announced $1 billion of investment in data centres; and Wayve, the British autonomous vehicles business, raised over $1 billion in funding. Alongside CoreWeave, other AI businesses such as Scale AI, OpenAI, Anthropic, Palantir and Cohere have all chosen the UK to locate their European headquarters. The biggest Silicon Valley venture capital firms have opened offices in London. Alongside the appeal of our homegrown talent and their innovations emerging from incubator universities, these firms are coming here because we have not followed Europe and rushed to regulate AI.
In our report, Large Language Models and Generative AI, earlier this year, the Communications and Digital Select Committee, which I chaired in the last Parliament and hope to start chairing again soon, highlighted the risks of the Government getting the balance between safety and innovation wrong. We were concerned about the serious risk of regulatory capture and of introducing legislation that entrenched the market dominance of big tech. We said that the markets for AI must remain open, and that not creating barriers to entry but supporting innovation should be the Government’s priority when considering any new regulation.
One of my personal fears with this new technology is not some existential risk to the human race; it is repeating the same mistakes which led to a single firm dominating search, no UK-based cloud service and a couple of firms controlling social media. Only on Friday, the worldwide disruption caused by CrowdStrike’s update to Microsoft Windows showed us just how vulnerable we are to concentration in the market. It was therefore music to my ears when Rishi Sunak declared in May that the Government were pro-open source, which is critical if we are to avoid a new oligopoly, and confirmed that they would not be legislating. However, I was dismayed, if not surprised, to read in the Financial Times ahead of the gracious Speech that, by contrast, the Labour Government would introduce new AI regulation. I was then confused to read on the day of the King’s Speech—in the FT again, so it must be true—that following a last-minute tussle between DSIT and No. 10, the Government would not be announcing a Bill but launching a consultation instead.
Today, the noble Lord, Lord Vallance, said that the Government would bring forward
“binding regulations on the handful of companies that are developing the most powerful AI models”.
This is precisely what these big tech firms want, because it assumes that the technology is static and no one else can or will enter the market. That is so very wrong and risks closing the door on more innovation and growth. Will the Minister who is winding up the debate please clarify the Government’s position on regulating this important new technology? Are the Government pro-open markets? Are they pro-open source? What is their position on copyright in the context of AI? Copyright is the most significant issue of contention, where clarity is needed urgently so that our news and creative industries are properly recognised for their vital contribution to this technology’s development.
In short, can the noble Lord confirm that his Government will not adopt a similar approach to that of the EU, or seek regulatory alignment with the EU, when it comes to regulating AI? I worry that when it comes to generating economic growth, this Government’s vision of the future will soon look uncannily like the past. While some Members of this House would be rather pleased if it did, when it comes to maintaining our position in the world in developing and deploying AI, and the potential of what some now refer to as little tech, believe me, a new version of “Back to the Future” would not be good for UK economic growth.
Baroness Randerson (LD)
My Lords, I start by congratulating the noble Lord, Lord Vallance, on his excellent maiden speech.
I was delighted to see the cluster of public transport Bills in the gracious Speech, including the imaginative reuse of the high-speed rail Bill, although I was disappointed that government comments so far seem to suggest that they have abandoned the concept of HS2 moving further north. However, I hope that they will use the Bill as a vehicle for a major upgrade in rail infrastructure in the north of England that is way overdue. Across Europe, high-speed rail blossoms. Why should we not be able to do the same in the UK? The three rail Bills should in practice provide a coherent whole, but I am a bit worried that the Government’s vision of rail reform may be too complex to truly maximise its potential.
Liberal Democrats support Great British Railways; we support a guiding mind, taking day-to-day control out of the hands of the Department for Transport. However, we have concerns that renationalisation would sap energy that should go into efficient timetables. There is also inconsistency. Apparently, open access operators are okay. What about the ROSCOs—the rolling stock leasing companies? If any part of our railways benefits from excess profits, it is those leasing companies—three large companies with an element of monopoly profits. A quarter of train operators’ costs goes to those companies, and yet there seems to be no mention in the outline of legislation about their role. I was, however, delighted that passengers will have a powerful champion.
I was very pleased to see the better buses Bill, which is desperately overdue. We have decades of experience to show how counterproductive deregulation outside London has been. Buses are by far the most frequently used form of public transport; they are used in particular by the youngest, oldest and poorest in our society. But our bus services have been dying off rapidly. We on these Benches agree that of course local councils need greater powers, but they are very cash-strapped, and power without money is meaningless. We want to see simpler, dedicated funding for buses.
Briefly, I was extremely pleased to see the proposal for funding support for sustainable aviation fuel. Aviation is the most difficult sector to decarbonise and urgently needs investment.
We will provide a constructive approach to the proposed legislation. We agree that the priority has to be to strengthen and modernise our public transport infrastructure, which has been a brake on economic social development and our efforts to tackle climate change.
I want briefly to mention two other aspects of the economy. The first is the higher education sector, and I must declare an interest as chancellor of Cardiff University. It is essential that the crisis in university funding is tackled immediately. Higher education has been a leading sector in our reputation across the world, but it is at imminent risk of collapse. The funding model is fundamentally broken, and universities papered over the cracks by recruiting more foreign students. This is a highly competitive market and can work only with government support. Instead, the previous Government undermined the sector by talking down the quality of UK degrees and introducing visa complexities. Universities face massive budget cuts and budget deficits; there will be closures, mergers and job losses, and long-term damage to the sector. I was therefore very disappointed that there is no legislation to deal with this.
Secondly, in one sentence, the arts sector is desperately underfunded. I make a plea that the Government work with the Welsh Government on the funding of the Welsh National Opera. It spends 60% of its time touring and performing in England; it is as much England’s opera as Wales’s opera, and it needs urgent assistance.
Lord Birt (CB)
My Lords, we are at one of the most challenging moments for government in modern times, with high debt and taxation on the one hand and chronic underperformance in every part of the public realm on the other. Unsurprisingly, the public has become exceptionally disaffected, as we have just all witnessed. Turnout for the election was the second lowest since 1885. The share of the vote both for the Conservatives and the SNP almost halved; between them, they lost almost 300 seats. In the most striking sign of protest, Reform went from nowhere to a 15% share. We should not forget that the Lib Dem’s share of the vote barely changed from the 2019 election, or that although Labour gained handsomely in Scotland, there was no increase in its share of the vote in England. This mightily disaffected electorate is indeed hungry for change, yet it is simply impossible for a new Government quickly to put right all that is wrong.
Here lies a great danger: the politics will cry out for plenty of activism and for early signs of progress, but if we are to fix all that is broken, we need to embark in every single area on a long and most carefully considered journey. Of all the myriad issues that confront us, improving economic growth and productivity is by far the most critical, as it is the only way of materially improving both personal prosperity and our failing public services. But we cannot just sloganise about investing in AI and bioscience, vital though they are. We lack, and desperately need, a deep diagnosis of what is holding back the whole of our economy if we are to grow.
We should begin by trying to understand, for instance, why Germany and France have far higher productivity than we do. German workers, for instance, produce 17% more GDP per hour worked than those in the UK. One possible reason for this glaring gap—the noble Lord, Lord Inglewood, touched on it earlier—is the success of Germany’s Mittelstand, or SMEs, which produce a far higher proportion of Germany’s GDP than the UK’s own mid-ranking companies, which, though far less productive, provide 60% of UK jobs and are at the very heart of our working economy. We also need to understand, as the noble Lord, Lord Monks, raised earlier, what is driving our significant regional imbalance. London’s productivity, for instance, is an extraordinary 80% higher than the UK’s as a whole.
There are many other possible factors contributing to the UK’s lower economic performance. First, by common consent—much mentioned today—we take for ever in the UK to do anything where planning permission is needed. This must change. Secondly, the ONS reports that a remarkable 11 million Britons of working age do not have jobs and are therefore not contributing to the economy. Thirdly, our systems for meeting the skill needs of the economy at every level are lamentable; we have 1 million job vacancies and pronounced skill shortages in every sector, in almost all categories of skill. The noble Lord, Lord Mair, earlier emphasised one particular area. Shockingly, nearly 1 million of our young people aged 16 to 24 are not in jobs, education or training, and are not therefore acquiring the skills that our economy so desperately needs—fingers crossed for Skills England.
Fourthly, to echo the right reverend Prelate the Bishop of Leeds and others, we have by far the worst road and rail infrastructure of any major country, underinvested in for over half a century. I hope the new Government will produce a comprehensive long-term plan—many have mentioned this—for effectively travelling within and between our major industrial areas, both by road and by rail. I hope too that Labour will eventually resurrect its original vision for HS2, framed during its previous term in office, noting that, in the meantime, China has created an HSR network of around 40,000 kilometres and Spain one of 4,000 kilometres, while the UK has still not moved past a miserable 109 kilometres of HSR. The noble Baroness, Lady Randerson, will agree with that point, I am sure.
Finally—this is not an exhaustive list—in an act of extraordinary self-harm we have exited one of the world’s big three economic blocs, removing ourselves from a huge single market that we were chiefly instrumental in creating. In the process, we have introduced unwelcome complexity into much of our trading. Goldman Sachs estimated recently that our economy is now 5% poorer as a direct result. Plainly, we must do all we can to optimise the trading relationship with the EU for the benefit of both parties.
In sum, we need to analyse and to address all the many possible causes of our low productivity if we are to grow and to prosper. I hope the Minister will agree.
Lord Wigley (PC)
My Lords, I congratulate the noble Lords, Lord Vallance and Lord Petitgas, on their maiden speeches. I welcome the timely reminder from the noble Lord, Lord Heseltine, about the economic cost of Brexit, and indeed follow the noble Lord, Lord Birt, on that matter.
The economic mismanagement of Wales led to the Conservative Party losing every Welsh seat on 4 July. Labour won 27 seats in Wales. Plaid Cymru won four, and its vote increased by almost 30%. The latest poll for the next Senedd elections puts Plaid within a 2% swing from Labour to be the largest party.
I have no doubt that Plaid’s surge in support arises from the failure of UK Labour at the recent election to address the economic problems of Wales or to commit on key economic issues, and this led to a 23% reduction in Labour’s vote compared to 2019. Specifically, despite Welsh Labour having repeatedly demanded that the Barnett formula be replaced by a needs-based formula—something recommended by a Lords Select Committee over a decade ago—this issue was totally ignored by UK Labour, leaving Welsh Labour legless. If we are to continue with the discredited Barnett formula, why oh why have the Labour Government not taken the opportunity to ensure that Wales has full Barnett consequentials to the spending on HS2, as is enjoyed by Scotland?
We had hoped that we might have had a commitment to transferring the Crown Estate in Wales to Senedd Cymru, as happened in Scotland in 2016, and which—yes—the Welsh Labour Government have supported. But the King’s Speech, in flagging up a Crown Estates Bill, makes no such proposal.
Economic development is a devolved subject, but the Welsh Government need the tools and the resources to do the job. The EU recognised the depth of that crisis by according Wales the top level of regional support, and we were promised by Brexiteers that the UK Treasury would replace the EU aid. That just has not happened. The Welsh Government have placed the blame for this on the UK Conservative Government, so at the recent election there was an expectation that UK Labour would make a manifesto commitment on such matters to Wales. Alas, that did not materialise, and judging by the King’s Speech those economic and financial expectations are not going to materialise now, either.
Wales needs a new deal to enable the Senedd to take economic initiatives as well as maintain public services to an acceptable standard. Without such a change, the Welsh Government face a £700 million further cut in public services. Are we to see Tory austerity replaced by Labour austerity under this Government? Talking of austerity, will the Government please commit to the removal of the two-child cap, which would help 65,000 children in Wales?
Where do we now stand? The UK Government indicated in the King’s Speech their intention to legislate in matters such as transport and planning, matters that have economic significance but which are largely devolved. They did so without prior discussion with the Welsh Ministers, informing them of their intentions on the morning of the King’s Speech. Will the Minister please give an assurance that such legislation in devolved portfolios will not be applicable in Wales without the prior consent of the Senedd?
Considerable emphasis has rightly been given by the Government to the generation of electricity from renewable sources, and Wales has huge potential for offshore generation, including tidal and estuarial schemes, but the time profile of such sources may not coincide with demand. So will the Government also please press ahead with the SMR plants planned for Wylfa and Trawsfynydd, generating electricity to meet the baseload? Will the Government also speed up the programme for pump storage schemes to reschedule available electricity to the times of greatest demand?
The cost of energy is a significant factor for Tata Steel at Port Talbot. If Britain has no steel industry, it will not have a credible independent defence capability. Will the Government urgently discuss with Tata whether building new electricity generation capacity at Port Talbot could help Tata to reconsider its present plans?
Agriculture in Wales is the source of secure food supplies and the bedrock of the rural economy. Will the Government end the policy of encouraging meat imports from other continents, undermining domestic agriculture and worsening the carbon footprint generated by shipping meat half way around the world?
Finally, can we agree across this House that the key to economic improvement is to raise the economic activity rates in all parts of this island? How are the Government going to achieve this?
Lord Sherbourne of Didsbury (Con)
My Lords, I begin by giving a very warm welcome to the noble Lords, Lord Livermore and Lord Vallance, in their new ministerial posts. I also congratulate the noble Lord, Lord Vallance, on an excellent and very meaty maiden speech. In his absence, I also congratulate my noble friend Lord Petitgas for his captivating and insightful maiden speech.
During the election campaign, we heard two words repeatedly from the Labour Party: growth and change. When people talk about economic growth, they always think of the Treasury as being the lead economic department, but the fact is that growth does not come from an equation or an econometric model; it comes from people. The only way to get growth is by having a well-educated, highly trained, energetic and enterprising workforce, and a fit and healthy population.
We should think of the three departments of education, health and employment as the real drivers of economic growth. If we are to make them effective, we need radical change. I hope that when the Labour Government get going, the word “change” will not have been a slogan but will be reality.
Taking education first, we all know the importance of students leaving school and college with the skills that employers want—it is talked about a lot—but they will have to be very adaptable, because the world is going to change in ways we cannot even imagine. In 10, 20, 30 years’ time, employment will be completely different than it is today. We need to make sure that they are trained and educated in ways that help them to adapt, and that the importance of vocational and technical training is raised again and again, as it was last week by my noble friends Lord Baker of Dorking and Lord Willetts.
We should also think more creatively about how we can bring into our schools people who might not otherwise have thought of teaching, but who come perhaps half way through their careers because they are good communicators and motivators and can bring experience of the outside world from business or charities to motivate our young people.
The second area is health. Again, here we need radical change. I am encouraged by the words we keep hearing from the new Secretary of State for Health. He knows that the NHS is not the envy of the world; there are many other health services around the world that are more effective and efficient. I hope that the Secretary of State will bring forward some radical changes to the health service. If he does, I hope very much that they will be supported by this side of the House and will not get sniped at, as I suspect would have happened if such reforms were brought in by a Conservative Government.
We also need to look very carefully at how we can make our population fitter and healthier, not just treating illness but preventing it. There is a huge job to be done on the food people eat and in encouraging them to be more active. This is a crucial area.
On employment, as the noble Lord, Lord Birt, alluded to, there are now over 9 million people of working age who are not in work and are not looking for a job. Some of those people may have very good reason not to be doing so. However, as he said, that is a huge loss of economic capital which is not being deployed. Again, the Government will have to think very carefully about how they can incentivise people to come back into the workforce, perhaps also with disincentives to encourage them to do so. Radical thinking there is needed as well.
Therefore I hope again that when the Government talk about change, they mean change, not just a slogan.
Lord Kennedy of Southwark (Lab Co-op)
My Lords, before we carry on with the debate, I remind colleagues that the advisory speaking time is five minutes. When noble Lords get to four minutes, they should begin to make their wind-up remarks so that we can finish. A few contributions have gone to over six minutes, and if that carries on we will be here gone midnight. If noble Lords can just focus their minds a bit and try to keep to the advisory time, we will all get home at a reasonable hour.
Lord Drayson (Lab)
Message received, Chief Whip.
My Lords, I add my congratulations to my noble friend Lord Vallance on his excellent maiden speech and his appointment as Science Minister. I look forward to him bringing his wealth of experience to the role and to our debates in this House. In my brief comments today, I wish to focus on wealth creation, and I draw the attention of the House to my business interests in the register.
My favourite painting in the Houses of Parliament is the one of “Queen Elizabeth I greeting her Merchant Adventurers”. It represents a wonderful evocation of the national importance of wealth creation and makes the point that creating wealth involves accepting risk in the pursuit of opportunity. That is what makes it an adventure. Today, that adventure means grasping the potential of science and technology to create wealth and drive economic growth, rewarding and celebrating people for being willing to work hard, take risks and make growth happen, celebrating not just the results of success but the very process of wealth creation itself.
The King’s Speech, setting out the Government’s mission to secure economic growth, and the Prime Minister’s commitment during the election to make wealth creation his number one priority, make it clear that this Government will champion wealth creation—that they stand by the side of the wealth creators, celebrating and motivating them to succeed.
I welcome the national wealth fund and the recently announced changes to the listing rules by the FCA that will come into effect next week. I also welcome my noble friend Lord Livermore’s new role, leading on growth in the Treasury, and I encourage him to move quickly to address the main problem holding back technology entrepreneurs from realising their full potential: lack of scale-up capital. We urgently need to increase the funding available so that our companies can get the capital they need to grow.
We need to stop the flow of equity investment out of the UK and get it flowing back into UK businesses. As of the end of June, UK equity funds have had 37 months of consecutive outflows, totalling more than £20 billion. The UK has the third largest pension market in the world, worth over £2 trillion, but—unlike other countries—we do not invest those assets in the UK. Our pension funds currently own only 2% of the UK market.
That wall of money exiting the UK has depressed valuations, starved companies of growth capital and dried up the UK market for IPOs. It has led to our companies being acquired at low prices, with the number of listed UK companies down by 20% in five years. We have lost many great companies, DeepMind, Arm, Solexa and Darktrace being just some high-profile examples. I therefore welcome the pension schemes Bill and the opportunity it brings to encourage our pension funds to consolidate and to invest in these UK companies to drive growth. We need to get our financial institutions back into the business of backing UK science and technology.
Because of our strong science base, we will create some of the most innovative companies in the world over the next 20 years, in life sciences, aerospace, clean energy and computer science. However, it is not enough to be good at the science and the start-ups—as we are—because we need to be good at scaling them up too. If we build the gigafactories, the server farms and the biolabs here, we will secure the highly paid jobs that go with them and the taxes to fund the public services we need. If we are prepared to grasp this opportunity, ensure growth capital is available, accept the risks and manage them well, we will once again become a wealthy nation. It can be done, and I am delighted that this Labour Government have the will and the plan to do it.
Lord Shinkwin (Con)
My Lords, I too congratulate the noble Lord, Lord Vallance of Balham, and my noble friend Lord Petitgas on their powerful maiden speeches.
Democracy means that the voter is never wrong. My party has just been served a very generous helping of humble pie by His Majesty’s electorate. It may taste foul, but I sense that they expect us to eat it, and to do so gracefully. Notwithstanding the low proportion of vote share and thus the shallowness of the mandate granted to government, the appetite for change was unavoidably clear—I suspect not so much because of what we did but because of what we failed to do.
Immigration aside, nowhere is this perhaps more apparent than in the field of disability employment. The opportunity afforded by 14 years in government to close the disability employment gap was squandered. It remains at around 30%. Of course there are myriad reasons, but one of them was undoubtedly that my party, sadly, dropped the ball on disability. Indeed, by actually making it more difficult for disability rights to be enforced, we effectively disowned the jewel in our social justice crown, the Disability Discrimination Act 1995. For me, as someone who was born with a disability and who chose to be a Conservative precisely because equality of opportunity was and always should be an article of faith for any Conservative Government, the failure to apply that principle to disabled people in practice was completely counterintuitive.
So I for one do not regret the commitment in the most gracious Speech to publish a draft equality (race and disability) Bill and specifically to introduce mandatory ethnicity and disability pay-gap reporting for large employers. My only regret is that some in my party still give the impression that they believe this is woke nonsense. Nothing could be further from the truth. Transparency is a good thing, and mandatory pay-gap reporting is in line with recommendations made by the CSJ Disability Commission, which I chaired, the IoD commission on “The Future of Business: Harnessing Diverse Talent for Success”, which I also chair as per my entry in the register, and, of course, the Disability Employment Charter, the brainchild of Professor Kim Hoque. I congratulate him and the charter’s founding members on their success in securing around 200 signatories, including companies such as Adecco, Schroders, PageGroup and McDonald’s.
In conclusion, I hope very much that the Government will take into account the support of business leaders such as Steve Ingham, the former and very successful chief executive of PageGroup and now chair of the Business Disability Forum, for mandatory disability pay gap and employment reporting, and that this draft Bill will create a supportive policy environment for employers who want to do the right thing for their business by recruiting and promoting diverse talent, but on a transparent, level playing field.
Baroness Kidron (CB)
I welcome the new Ministers and commend the noble Lord, Lord Vallance, on his maiden speech. Indeed, I wish the new Government well in their ambition for growth and their commitment to creativity in education, without which we squander both joy and one of our most valuable industries. I am encouraged by early statements about skills and innovation.
I will use my time to raise vital unfinished business that was abandoned as the snap election was called. In doing so, I declare my interests in the register, particularly as chair of 5Rights Foundation and adviser to the Oxford Institute for Ethics in AI. Top of the list was the measure to give coroners access to company data in cases where a child has died. We have campaigned long and hard for this and I am grateful to the Secretary of State, Peter Kyle, for committing to carry it forward in the data Bill. Can the Minister say when the Bill is anticipated and confirm that it will not undermine any existing protections for children’s data privacy?
Similarly promised and equally urgent is the new criminal offence of training, distributing or sharing digital files that create AI-generated child sexual abuse. The offence was agreed in principle with the Home Office and the irrefutable reasons for it are recorded in Hansard on 24 April at col. 588GC. Can the Minister please also commit to this measure?
Other agreed measures, all supported by the Labour Front Bench when in opposition, include data access for independent academic researchers. Access to data is an essential part of the innovation supply chain, and therefore the growth agenda.
There is a scandal brewing as the edtech sector oversells and underdelivers in our schools. The DfE had agreed to a review to establish criteria for efficacy, safety, security and privacy, so that children are as well protected inside the classroom as on the bus to school. A trusted edtech sector is yet to be developed anywhere in the world. It is a necessity and an opportunity.
The new Secretary of State has committed to strengthening the Online Safety Act. The children’s coalition has set out its concerns with Ofcom’s draft codes, which I will forward to Ministers. The gaps that it has identified are as mission-critical to the published codes as they will be to tackle violence against women and girls. It would mean a lot if the Secretary of State’s commitment made in the media to look again was repeated at the Dispatch Box today.
Finally on unfinished business, current UK law determines that computer information is always reliable, which is nonsense and has contributed to multiple injustices, most notably Horizon. The previous Lord Chancellor looked at how to rectify this. I was delighted to see the new Attorney-General introduced today. This must be a priority for him.
This is not an arbitrary list but part of a broader view that we need to live with and alongside technology to build a future that many cannot yet imagine and access, as the noble Lord, Lord Vallance, said. Technology will play an enormous part in our economy, but it is also fundamental to our security, self-worth, well-being, happiness, confidence in the future, and Britain’s place in the world, all of which are essential for growth.
Like the noble Lord, Lord Clement-Jones, I am concerned by the absence of a more comprehensive AI Bill, and I pray that the incoming Government have not already blinked in the face of tech lobbying. An AI Bill to establish minimum standards for the design and deployment of AI systems, manage risk, build necessary digital infrastructure and distribute the benefits more equitably is essential. As the noble Lord, Lord Clement-Jones, said, innovation should not be unconditional and regulation need not be the enemy of innovation.
Our response to digital transformation has been poor, largely due to a gap between the expertise of policymakers and those we seek to regulate. A permanent Joint Committee of both Houses on digital regulation is often asked for and could address this. In the meantime, I invite the Minister to meet the cross-party Peers informally referred to as the Lords tech team—of which the noble Baroness, Lady Jones of Whitchurch, was once part—to take forward the issues I have raised and work towards a model of innovation that serves the public as well as the Government’s growth agenda.
Baroness Benjamin (LD)
My Lords, I rise to speak about the crisis in children’s television. I declare an interest as per the register. But first, I congratulate the noble Lords on their maiden speeches, and the new Government. I want to highlight the urgent work that is needed to address the challenges facing children and young people. I hope to work closely and constructively with the Government, along with the children’s charity Barnardo’s—I declare an interest as its vice-president—to ensure that children grow up feeling safe, happy, healthy and hopeful about their future.
For years I have been calling for a Cabinet-level Minister for Children, so I welcome the Government’s new ministerial task force on child poverty, with a unit in the Cabinet Office. Cross-government collaboration is crucial to deliver change and opportunities for all children.
I was encouraged to see plans to strengthen children’s social care regulations and measures to address children’s health inequalities. However, research by Barnardo’s has shown that, as a result of the two-child limit and the cost of living crisis, families are struggling to prioritise essentials. If the existing child benefit policy is not reformed, an additional 670,000 children will be affected by the end of this Parliament, so, alongside much-needed legislative change, the Government need to prioritise investing more of our national wealth in improving children’s lives, especially early intervention and prevention. Economic growth is important, but I urge the Government to take bold action in the autumn spending review to lift children out of poverty and invest in the future health and well-being of the children who have faced difficult and challenging starts to their lives. The moral and financial cost of doing nothing is too high.
It was a shame that the Windrush compensation scheme was not mentioned in the King’s Speech, but I hope the Government will find ways to end this outrageous scandal. The money has been allocated to do so.
During the debates on the previous Government’s Media Bill, amendments were proposed which called for the start of an urgent review into the way our children access content on unregulated online services such as YouTube and TikTok, in huge numbers compared with the dwindling audiences and migration from public service broadcasters. Will this new Government—whose Minister, like me, proposed such amendments calling for the review—now stand by their word and instruct Ofcom to undertake an in-depth analysis of the implications of this huge change in viewing habits and its effect on the children’s media industry? YouTube, which has a giant slice of the children’s audience, shares very little of its advertising revenue with producers and does nothing to make public service content prominent.
We need to find new ways of regulating these largely unregulated platforms so that they become responsible providers, not just providers of content designed to generate maximum revenue for shareholders, with no thought given to the young people they are serving, which has a detrimental effect on children’s well-being and on children’s media practitioners. There are also concerns about how high-quality public service children’s content is going to be funded, where it is going to be found and how children are going to view it, as highlighted at the children’s media conference.
Children do not have a vote or a voice, but they are massively affected by policies. So, on their behalf and on behalf of those in the media industry, I ask the Government to consider policies that will be beneficial to them: first, to raise the tax credit for animation and television from 22.5% to 40% to match that for independent films, to address the market failure in the kids’ area. Also, they should look at ways of implementing a private/public investment fund to invest in companies and content and to allow producers to retain the rights to their work.
The scale of the challenge facing children and young people cannot be overestimated. But I am an optimist, and ready to work with the Government to change children’s lives so that they grow up happy, contented and influenced and inspired in a positive way—because childhood lasts a lifetime.
Baroness Young of Old Scone (Lab)
My Lords, I declare my various environmental interests and as chair of the Royal Veterinary College, which runs the London BioScience Innovation Centre, the first bioscience innovation centre London has ever had.
I decided not to speak in the environment section of the King’s Speech debate because I thought it was more important to say environmental things to Ministers for the economy, for growth and for infrastructure. Climate change, the environment, biodiversity and nature recovery are all central to the UK’s future economic growth.
I have three things to say. First, clean energy technology and other environmental technologies will be vital to the UK’s response to climate change. But that is not all they are: they are also key industries for the future in which we can compete internationally and create jobs and growth. My noble friend Lord Vallance said, quite rightly, that the UK’s science base was world class, but over the past few years we have lagged seriously behind in bringing innovation to market. Investment in green innovation technology and jobs can reverse that and I welcome those elements of the King’s Speech that talk about investment measures.
We need to take seriously, as part of this process, the concerns that have been raised by Universities UK and all our universities about the ongoing financial viability of the important university sector in delivering both science and skills for growth. Our UK growth potential is about technologies not just for carbon reduction and climate change mitigation but for adapting to the impacts of climate change that are so clearly already happening worldwide. Basically, it is getting hotter and wetter. The global insurance industry has been warning about this for a long time, saying that huge costs lie down the road. But huge costs mean huge market opportunities, so the UK should use its science excellence to devise solutions to the impacts of climate change globally, not only helping international communities but developing new UK international businesses and promoting growth.
Secondly, we should not throw the baby out with the bath water. The Government were right to identify that changes are needed to the way we do things if we are to achieve a step change in growth and I welcome the enhancements to the Crown Estate’s powers and the planning and infrastructure Bill—although much will lie in the detail.
Nationally important infrastructure and new housing and energy developments need to happen faster, but they also need to maintain the ecosystems on which a thriving economy depends. They also have to embrace nature-based solutions. Although I hesitate to use any American phraseology when it is clear that US politics cannot currently walk, talk and chew gum simultaneously, we need to learn to be able to do just that, in order to deliver for both growth and the environment at the same time. It is not either/or but both/and.
The third thing I will talk about is the potential for stoking up conflict. Infrastructure and other planning decisions may well need to be made centrally to ensure that they do not get mired in local opposition, but we must not assume that that central decision-making will make the opposition go away. Government needs tools and mechanisms to enable local engagement and dialogue if we are not to feel the flames from umpteen disgruntled local communities. In my experience, that is a very quick way to lose a majority.
This is where my oft-touted land use framework comes in—I have actually got to three minutes and thirty-nine seconds before mentioning it. The heated debate over the location of infrastructure and housing is just one element of a multiply heated debate about wider competing priorities for land use—not just infrastructure and housing but land for food security, flood risk management, carbon reduction, nature-based solutions and protecting our water supplies and rivers for recreation and health. A land use framework, to which I understand the Government are committed—I would like that confirmed—should develop principles that would allow us, as a nation and locally, to optimise the use of the scarce resources that land represents and make more rational decisions about what goes where. Vitally, it would also offer a conflict resolution process, promoting national and local engagement and dialogue around competing land uses and enabling stakeholders and communities to feel “done with” rather than “done to”. That is vital for economic growth.
I will give one example before the wrath of the Chief Whip falls on me. Communities offered starter homes for their kids, community energy schemes with cheaper electricity and local nature-rich areas can see a benefit to themselves of housing developments or solar and wind farms—or even nuclear power stations—but they need to be given that rounded picture of what land is for and where they lie in the beneficiary tree. So “doing with” and not “doing to” is vital for growth.
I will also incur the wrath of the Chief Whip by saying that I want a land use commission to run this process and, ideally, I would like to chair it.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I add my congratulations to the debutants on the Front and Back Benches on the series of very impressive maiden speeches we have heard today. I also do not want to fail to congratulate the Labour Party on its victory in the general election. In so far as the quality of the decisions the Government make will determine the success of this country, for good or ill, over the next five years, I wish them well as they seek to navigate an extremely tricky world and the extremely difficult circumstances of the country at present.
The Prime Minister, Keir Starmer, has successfully delivered the Ming vase to 10 Downing Street. He did not trip or fall over as he got there and the Labour Party is now in full operation. But the scale of the victory gives him and the Labour Party the opportunity to do some radical things that would, if successfully carried out, transform the long-term position of this country.
How should he be brave? I will offer three suggestions for him to consider. First, we need to be prepared to tell the people of this country that you cannot have US levels of taxation and European levels of social security. The numbers do not work. As my noble friend Lord Bridges said earlier, we are living beyond our means. We may be teeming and lading for a bit, but in the long term it will not work. That means we have to face up to some very serious issues, including the future of the triple—or is it quadruple?—lock and the position of local government financing where, as I said in Questions earlier, we have not reformed the bandings for 34 years. That is the first place where the Prime Minister can be brave.
The second place—this point was made by my noble friend Lord Sherbourne—is in supporting Mr Streeting and the work to reform the health and social care system. It will require a stupendous amount of his personal capital and of the political capital of the party as a whole. My party cannot ever touch the health service in that way because we are immediately accused of wishing to privatise it and therefore all reforms are stillborn. But we have an opportunity now to do something about it. We should do something about it, but we should not underestimate the severe vested interests that lie in the way. Some Members of your Lordships’ House may have seen “Nye” at the National Theatre, with Michael Sheen playing Aneurin Bevan. In that play you see the enormous concessions and changes he had to make to launch the NHS in the first place—and I do not think the situation has changed.
That takes me to my last point, one that I have mentioned many times in your Lordships’ House—the demographic future of this country and the trade-offs, up and down, resulting from the very rapid increase in population that the UK has been experiencing over the past quarter of a century. Let us face the facts. You cannot expect to increase your population by between a quarter of a million and three-quarters of a million people every year without some profound consequences. The downsides are felt most by the least advantaged members of our society, of whom over 20% are now from minority communities, in the provision of worthwhile economic activity, housing and public services, the necessary level of food and water security, the prevention of ecological and environmental degradation and the maintenance of social cohesion. The future levels of population play a vital and critical role.
There is no forecast suggesting that we will not have a population more than 5 million above where it is today—which is equivalent to two cities the size of Manchester—by the end of this century. We need to find a way to address this matter in an open and transparent way that reassures people that we are listening to their concerns. I have suggested a thing called the office of demographic change, or maybe the office of population sustainability. The important thing is that we set in train a methodology to reassure the public that their concerns have been recognised and are being addressed. Given the very far-reaching and irrevocable nature of the results of demographic change, this is in essence a discussion about the sort of country that we want to leave for future generations. If we fail to start that discussion, wilder spirits may well seek to exploit the vacuum that we have left behind.
Lord Howarth of Newport (Lab) [V]
My Lords, there is both the need and the opportunity for the new Government to be radical. We have to address poor productivity, low growth, regional and social inequality, shocking levels of poverty, collapsing public services and environmental degradation. We are told that the fiscal vice is so tight that the Government cannot spend any more money but also that there is a wall of money waiting to be invested in the UK. The case is clear for public/private partnership. The Chancellor has allowed herself more scope to invest than her Conservative predecessor did. The markets will smile on programmes led by government to encourage investment to green our economy and in sectors in which the UK can be globally competitive. This should not mean the national wealth fund making speculative investments in DeLorean-like projects, or the taxpayers soaking up losses while private investors hog the profits. It should involve the Government insisting that partner businesses adhere to principles to which the Government are committed for the public good.
More difficult is to judge what early scope the Government have to improve public sector pay and the funding of public services. The test should be: will such spending strengthen the economy over a reasonable timescale? Will it be good or bad for our economy to stem the haemorrhage of teachers from our classrooms and clinicians from our hospitals? If our economic malaise derives in significant measure from policies of excessive austerity, how can the remedy be the perpetuation of austerity? How can it make sense to say that private spending on every consumer frippery is fine but public investment in services is ruinous? One set of fiscal rules has repeatedly given way to another. What matters is the Government’s fiscal credibility. The markets need to know that there are competent and robust people in charge, monitored by a rigorous, reconceived OBR. The Treasury must never be an easy touch, but its default must cease being to wither our economy by reflexive negativity.
The Government have a large majority, great good will in the country and internationally, and five years ahead of them. The Labour Party campaigned on the theme of change. The gracious Speech gives us the first indications of change that I hope to see. A country that does not invest in its young people dooms itself to failure. The policies that we have inherited—the abolition of Sure Start, the reduction of funding per pupil, the chaos of FE qualifications and the near bankrupting of universities, as well as the immiseration caused by the two-child benefit cap, the neglect of children in care and mental health services, and the defunding of the youth service and drug rehabilitation—could have been calculated to create generations of poor, alienated, unproductive young people and spiralling costs in social services, welfare, health, policing and criminal justice.
The transformation of productivity must embrace education and skills; renewed infrastructure; a functioning housing market to enable a functioning labour market; social security reforms to strengthen incentives to participate in the labour market; the mobilisation of pensions finance; the cutting away of bureaucratic and self-interested obstruction; and improved performance in the public sector, including the NHS.
Through a brave approach to tax reform, Ms Reeves could improve productivity, social justice and Exchequer revenues. I hope she commits to a tax system that is a system and is progressive and green. To pick out just a few plums, she could levy council tax on the current value of properties. She could align CGT and income tax rates and restrict tax relief on pension contributions to the basic rate. She must introduce a carbon tax on greenhouse gas emissions.
Finally, our duty is to bequeath to our children and grandchildren a sustainable economy, so the growth that we pursue must be radically different from the prodigal consumption of irreplaceable natural assets that has characterised GDP-focused growth in the era conditioned by the thinking of defunct economists such as Keynes and Hayek. Our priorities must now be to preserve our natural assets, invest in new environmental assets and pay realistically for the pollution that we cause. The impact on current patterns of consumption, and on some people’s amenity, will be painful, but the consequence for our society’s very survival of shirking this responsibility will quite shortly be far more painful.
Lord O'Neill of Gatley (CB)
My Lords, I add my welcome to the new Ministers and wish them very well and the best of luck in their important roles. I also congratulate the noble Lords, Lord Petitgas and Lord Vallance, on their maiden speeches. Occasionally, as we all suffer long hours into the night, one wonders how the tone of debate in this place can be raised, but I am sure we all agree that the noble Lord, Lord Vallance, in particular, brings an example. I refer to my roles on the register, chairing the Northern Powerhouse Partnership and Northern Gritstone and having been on the now Chancellor’s start-up review group.
As the Chancellor and her team know, I believe that a credible refinement of their adopted fiscal rule is necessary to deliver the public investment required to help boost productivity. What would deal specifically with the interesting conundrums that the noble Lords, Lord Fox and Lord Eatwell, raised—and shift the attention away from the inappropriate focus on just the OBR’s GDP forecasting, which is not its greatest strength—would be to go one step further and, along with a beefed-up infrastructure commission more closely aligned with the IPA, enforce them to independently and publicly verify those infrastructure projects that can be shown to have major positive multiplier effects on growth and, as a consequence, reduce long-term debt. I doubt that this would trouble financial markets—possibly the contrary. It is quite conceivable that, if executed with proper independent evidence, it might raise the equity returns in the UK along with the value of the pound.
Central to boosting growth—and with it national productivity—is to raise the performance of so many of our underperforming regions, as pointed out clearly by the noble Lord, Lord Monks. However, there may be evidence of some modest signs taking place in this trend. As the Northern Powerhouse Partnership showed in a brief paper recently, since 2004 the productivity gap between London and the rest of the country has narrowed a little, partly and perhaps surprisingly because of a weak London performance.
Also, crucially, one or two other places have performed relatively strongly within the overall disappointing context of the UK. One of those has been Greater Manchester, which has grown at three times the London average and twice the national average. It is almost definitely not a coincidence that Greater Manchester was the first place to want, desire and to get some devolution back in 2014. In this regard, I applaud the Government’s intentions to pursue devolution as seriously as they seem to imply.
A second issue, as covered to some degree by the noble Lord, Lord Vallance, relates to our universities and the commercialising of their research. Northern Gritstone is a reasonably new investment entity that invests in companies coming out of northern universities, anchored by Leeds, Manchester and Sheffield. Twenty-four investments have been made in its brief time, and the £40 million deployed by Gritstone was in the middle of a broader £300 million that was galvanised, which is multiple amounts more than those taking place before Gritstone came into existence. While this is pleasing, it is far from sufficient and much more is needed, as is the case around the country. Efforts by this Government to unlock more long-term capital to support these great ideas and start-ups coming from our wonderful universities should be commended, and these efforts need to be pursued vigorously as well as thoughtfully.
Finally, I will touch briefly on the issue of regional house price trends, which, in fact, have also shown that London has been underperforming many other places since 2015, having dropped back around 18% relative to their peak ratio in 2016. Something out there is happening which is making other locations more attractive. Serious efforts to boost the supply of housing are also therefore hugely welcomed because, if successful, this should add to the apparent reversal of this multi-decade trend, which, among other things of course, has been so damaging for social mobility in the UK. Therefore, some crucial long-term changes may have just started to begin to turn, and with the right policy momentum, like any forms of intervention, will be better if the trend has changed. I therefore strongly encourage the Government and both Houses to be truly focused on these issues. More serious economic devolution, more commercialisation of ideas from our great universities, more long-term capital deployments at early and growth ventures, and a bigger supply of housing could do wonders for our productivity and therefore our growth prospects.
The Lord Bishop of Bristol
My Lords, it is a great pleasure to follow the noble Lords, Lord Howarth and Lord O’Neill, and to welcome and congratulate the noble Lord, Lord Vallance, and greet him as the granddaughter of a Cornish man and a Scilly woman, as my father rather cheekily determined it.
I preface my remarks by welcoming, in an adjunct to the gracious Speech, the Government’s proposal to renew the Lords Spiritual (Women) Act, and I should declare my interest as I am a Member who benefits from its current provisions. But it is on modern slavery that I wish to focus my remarks this evening as, in the labour exploitation that we have seen increasingly in the areas of agriculture, domestic work and social care, there is growth that we should not seek and indeed need to guard against. As your Lordships know, modern slavery is a crime which affects every community in the UK. It is not a niche issue. It is estimated that 130,000 people are held in modern slavery in our country today, and we are used to hearing about day-to-day transactions where there is exploitation in car washes, manicurists or, increasingly, in accessing social care.
I must start this debate with a belief in the inherent dignity of work and the right of all workers to receive fair payment for their labour, free from exploitation. I applaud the work of many Members of this House and the former Government for their genuine commitment to tackling this terrible crime. The 2015 Modern Slavery Act was by no means a perfect piece of legislation, but it signalled real political intent. We have a world-leading national referral mechanism which supports thousands of victims every year. I am proud of the progress that the UK has made but, while there is much to applaud, there have been concerning developments as well. The Nationality and Borders Act, the Illegal Migration Act and, most recently, the safety of Rwanda Act have all put victims of modern slavery at further risk. This is particularly true where migrant victims are imprisoned, often due to criminal exploitation, and can be subject to a public order disqualification. Can the Minister tell the House what the plans are for these various pieces of legislation as they affect migrant victims of modern slavery? If he cannot do so now, will he commit to do so in the future?
Alongside international trade in human beings is domestic exploitation of human beings, particularly through county lines, and I applaud the ambition to introduce a new offence for criminal exploitation of young people. The need for a clear definition of child criminal exploitation is something which I and many on these Benches supported before in this House. However, I am disappointed that modern slavery was not directly referenced at all in the gracious Speech.
Several noble Lords have mentioned shortages of labour in various sectors and, as many have said, nowhere is this more acute than in our social care sector to which we entrust the lives and well-being of some of the most vulnerable in our society. Last year, nearly one in 10 roles in adult social care stood vacant. There is clearly an acute need for a clear strategy to fill vacancies and deal with issues of recruitment and retention in the workforce. However, it is unacceptable that gaps in the social care sector have led to a rise in labour exploitation. We have recently seen reports that modern slavery is surging in this sector, with nearly one in five potential victims who calls the modern slavery helpline working in social care. Restricted, temporary work visas are creating the conditions for labour exploitation, especially as anyone on a health and care or skilled worker visa has just 60 days to obtain a new visa, during which time they have no access to public funds. To tackle exploitation, we should start by making work visas more flexible so that workers are not trapped in exploitative conditions.
Work must have dignity and give people purpose. I applaud the Government’s ambition to strengthen workers’ rights and will continue to seek reassurance that we will end the abhorrent practice of modern slavery for good.
Viscount Chandos (Lab)
My Lords, I enthusiastically welcome my noble friend Lord Vallance of Balham to this House and to the Government Front Bench and congratulate him on his inspiring maiden speech. I have high hopes and confidence in the ability of him and my other noble friends on the Front Bench—not least my noble friend Lord Livermore—and their colleagues in the House of Commons, to deliver on the excellent measures set out in the gracious Speech and those that will follow in subsequent Sessions of this Parliament. I should also, as a fellow but less distinguished recovering banker, congratulate the noble Lord, Lord Petitgas, on his admirable French philosophical maiden speech.
In its editorial last week on the King’s Speech, the Financial Times said:
“While the previous conservative administration generally believed in a small government, centred on correcting market failures, Starmer envisages the state as more of a force for good”.
If the Financial Times, which I generally revere, was trying, like some noble Lords opposite, to present the bogeyman of big government, I believe that it was drawing a false distinction. The new Government’s programme is based on impeccable social market principles, being centred on the market and intervening directly or indirectly through regulation only where there are market failures. The difference between this Government and the last is in the recognition of the sheer scale of market failure that needs to be addressed, and urgently, as well as in the competence and determination that will be brought to bear on these challenges.
Partnership with the private sector and private funding is, as my noble friend Lord Wood said, at the heart of the Labour Government’s approach, whether in housing, renewable energy, infrastructure or innovation. I will speak briefly about two aspects of this.
First, I welcome the national wealth fund and its sensible approach of continuity, which builds on the UK Infrastructure Bank and the British Business Bank. I was amused by the semantic grumbles of noble Lords opposite about it not being a sovereign wealth fund—not that many of the wider population would, quite sensibly, be alert to the finer points of this definition. I was amused by the irony that, if ever there was a period in which a sovereign wealth fund should have been established in the UK, it was during the Conservative Administration from 1979 to 1997, which coincided with the peak surplus from North Sea oil production. Instead, the revenues were frittered away and the exchange rate pushed to eye-watering levels, with unnecessary damage to UK industrial competitiveness. Economic mismanagement was not confined to only the most recent Conservative Governments.
I welcome too the proposed pensions Bill and the important reforms to the pension fund industry. These are vital, as my noble friend Lady Drake much more expertly spelled out, but if ever there was an area in which the devil is in the detail it is this.
The noble Lord, Lord Morse, struck a note of caution, with which I agree, about the difficulty of balancing the obligations of trustees and managers to deliver the best possible risk-adjusted returns through asset class and geographical diversification with the desire to encourage investment in UK companies and innovation. Although returns from private investment funds—from infrastructure to buyouts, from expansion to venture capital—can be superior to those from public market funds, the disbursement of those returns between different managers and funds is, according to authoritative Cambridge Associates data, much more extreme. It is hard enough to invest in these asset classes as successfully as, say, Wellcome Trust or the Yale University endowment, without any geographical or sectoral bias. We must be careful not to harm the overriding interests of pension fund members through well-intentioned but ill-judged private investments.
I therefore look forward to the Bill being brought forward for consideration by your Lordships’ House in due course, along with the other legislation to deliver this excellent programme for government.
Lord Holmes of Richmond (Con)
My Lords, I declare my interest as set out in the register as an adviser to LEMI Ltd. I congratulate the noble Lords, Lord Vallance and Lord Livermore, on their new ministerial positions; I look forward to working with them over the coming months. I particularly congratulate the noble Lord, Lord Vallance, on his excellent maiden speech, and likewise my noble friend Lord Petitgas on his tremendous contribution. I look forward to more from both.
I will concentrate on three areas, all of which touch on productivity, possibilities, potential and growth—that is economic, social and psychological growth. The first, as rightly identified by my noble friend Lord Shinkwin, is the issue of disabled people and employment. We currently have an employment pay gap for disabled people of over 13%. I welcome the forthcoming Bill from the Government and look forward to seeing the detail, but could the Minister say what plans the Government have to close that disability employment pay gap?
More than that is the employment gap for disabled people; only just over half of disabled people of working age are in employment, compared to more than eight in 10 non-disabled people. What is the Government’s plan to address this? The previous Government made some progress, but nowhere near enough. Governments of all persuasions cannot continue to waste this talent, decade after decade. It is clear that, when we have a tight labour market, we must look to the talent pools. Disabled people are a bright, deep and broad talent pool, from which the country needs to benefit.
The second area is the question of international trade. Last year’s Electronic Trade Documents Act was described variously by me as the most important law that no one has ever heard of and the blockchain Bill that does not mention blockchain. However, it is extraordinarily important, because it is probably the first time that the UK has legislated for the possibilities of new technologies, if you will. Why is it significant? It can unlock billions in liquidity and address the trade finance gap. Could the Minister say what the Government’s plan is to enable all enterprises, particularly small and medium-sized enterprises—many of which do not, or believe they could ever, export—to be aware of the possibilities of this new legislative opportunity? What work is happening from the Foreign Office to ensure that other nations—our friends around the world—are aware of opportunities they could benefit from if they passed similar electronic trade documents legislation?
The third area, as has already understandably been touched on—not least by the noble Baroness, Lady Kidron, and the noble Lord, Lord Clement-Jones —is the question of artificial intelligence. It is one of the greatest challenges and opportunities in our human hands. Human-led or human-in-the-loop technologies must be the way that we look at artificial intelligence.
I note that the report of the Chief Scientific Adviser, in March 2023, highlighted the opportunities from artificial intelligence and rightly identified that urgent action was required within the next 12 to 24 months. Is that still the Government’s position? We have such an opportunity to change so many of the difficulties that have dogged our society and economies for decades, if we understand how to fully deploy AI and do that with the right-sized regulation and legislative framework. To my mind, it is not time to wait and see, as the previous Government did; it is not time to look just at high-risk models, important though they are, as the current Government are doing. We need broad, cross-cutting, horizontally focused legislation and right-sized regulation to ensure that we benefit from the opportunities and put the citizen, the consumer and creatives at the heart of everything that we do in AI.
If that is not the Government’s plan, what they would say to creatives whose IP and copyrighted works are being taken with no consent and no remuneration, not least by large language models? What do the Government say to those who find themselves on the wrong end of an AI decision, often without even knowing that AI has been involved in the mix? Even if they found out that AI was there, they do not have any right of recourse or regulator to go to. What is the position if the Government and society do not have a true, invigorated public debate around artificial intelligence, to answer the question, “What’s in this for me?”, being asked by people up and down the country? If there is no trust, people are unlikely to avail themselves of the opportunities of AI and will certainly find themselves on the wrong end of its burdens.
This must be principles-based and outcomes-focused, in which inputs are understood and, where necessary, remunerated. Look at the Government’s regulatory innovation office; why not make it an AI authority and the centre of excellence, and of experts, which is the custodian of the principles of trust, transparency, innovation and interoperability, with an international perspective, accountability and accessibility? We have such an opportunity in the UK, with our great tech sector, universities and English common law, to play a critical role with AI. Does the Minister agree that it is time to look broad, to legislate and to lead? This is our data, our decisions and our AI futures.
Lord Layard (Lab)
My Lords, how wonderful that we have two such excellent new Ministers. We are talking about growth, and growth depends on only two things: productivity and employment.
Higher productivity depends hugely, of course, on higher skills. Higher skills are not only more productive in themselves, but they also raise the return to physical capital and therefore they then induce more investment. But our record on skills outside universities is a disgrace. For young people under 25, we have 40% fewer apprentice starts now than in 2010. There is massive excess demand for apprenticeship places. In the Government’s matching scheme, there are three times more applicants than there are places available.
The gracious Speech talked of reforming the apprenticeship levy. That is good, but much more is needed. We should be guaranteeing offers of an apprenticeship to every qualified applicant, as we legislated for in 2009 before it was then repealed a year later. That is something we could achieve by the end of this Parliament, and it would be one of the most valuable investments the Government could make.
At the London School of Economics, we have been estimating the value for money across a whole range of policies. For the apprenticeship guarantee, we estimate a ratio of public benefit to net Exchequer cost of 13:1. This compares, for example, with only 3:1 for the typical road-building scheme, and under 2:1 for the lower Thames crossing we were discussing earlier today. So I would like to ask the Minister: what are the plans for implementing the apprenticeship guarantee, which was already hinted at in the Government’s election manifesto?
Turning to employment, we now have over 2 million people not seeking work and living on disability benefits. At least half are suffering from mental health problems for which there are effective treatments. We must tackle mental health problems both in childhood, as the gracious Speech quite rightly said, but also in adulthood. Most adults with mental health problems are simply not receiving the effective talking therapies that NICE recommends. For those with anxiety disorders or depression, NHS talking therapies provides treatment for 13% of all people with these conditions, and the service pays for itself because so many patients go back to work, pay taxes and cease getting benefits. That is good for those with anxiety or depression, but there is no such service for the 1 million or so people suffering from addiction to alcohol, drugs and gambling or from personality disorders. NICE also recommends psychological therapy for all these conditions, but it is simply not provided. A new service for these conditions would increase employment by tens of thousands. In that way it would, again, pay for itself. It should be there in the next NHS plan. Can the Minister ensure that the Treasury supports this idea?
I have given two examples of concrete policies that are good for growth, but of course the real test of a policy is what it does for the well-being of the people and for the public finances. The best policies are those which give the most well-being per net cost to the Exchequer. When we come to the spending review, every policy should be evaluated that way in terms of the well-being benefits it provides relative to the net cost to the Government. The key test should be this benefit-cost ratio. It is not a new idea, but until recently it has been honoured more in the breach than in the observance. One reason for this is that the benefits that were included in benefit-cost calculations were too focused on just income, which is why Ministers typically then had to make their case for their policy in words, not in terms of the benefit-cost ratios. But now, with the help of well-being science, we can estimate a comprehensive measure of the benefits of most policies. The Treasury Green Book now strongly encourages this approach, but it has not been followed in practice.
Can the Minister confirm that when we come to the next crucial spending review, Ministers in all departments will be required to use the Green Book approach to make their case that way, and to do it for current as well as capital expenditure? For it is often as cost effective, or more cost effective, to invest in people as in things.
Lord Lee of Trafford (LD)
My Lords, first I declare an interest. I am here in my 83rd year, and there is a threat of the culling of the 80 year-olds. I would like to ask the Government whether they have any plans to provide counselling for us 80 year-olds as we live through the next few years under the sword of Damocles.
The Chancellor, in pursuing her growth strategy has a difficult balancing act. On the one hand, there will be inevitable tax rises—things such as CGT and possibly inheritance tax—but she must be careful to avoid stifling and blunting business and enterprise. Specifically, she must be very careful in possibly ending, for example, the business property relief, which would negatively affect AIM shares—shares on the Alternative Investment Market—because that would very much send the wrong message in terms of encouraging growth. I declare shareholdings in that regard.
I will focus my remarks today, if I may, on the stock market in particular. I think it is agreed that the UK market has been languishing and is undervalued. The number of UK listed companies is down by 40% from its 2008 peak, and of course we have had a rash of recent takeovers. The biggest boost would come, unquestionably, if pension funds modestly—I repeat, modestly—increased their UK equity content. Given that the pension contributions themselves come from the UK and the pensioners live in the UK, it is not unreasonable to ask that greater support is given to the UK equity market.
I have three specific recommendations. First, financial education in our schools is abysmal; there are many more youngsters who speculate in cryptocurrency than invest traditionally. I suggest that the Government gift, say, £5,000 worth of NatWest shares to every state secondary school, with the pupils themselves to decide how they spend that £350 dividend. Assuming full take-up, this would cost about £20 million in total, but it would transform young people’s knowledge of the stock market, dividends and banks. I and a number of Tory Peers put this to Jeremy Hunt, who was considering it, but of course the election intervened. I hope that Rachel Reeves will look seriously at this. We should also be encouraging regional public companies to gift small numbers of shares to schools in their locality. I intend to write to the QCA, the Quoted Companies Alliance, about this.
Secondly, there is near zero coverage by television of the stock market or investment opportunities. I believe this to be a national tragedy. I suggest it is a combination of producers’ disinterest and fear of the regulator. I got nowhere when taking this up with City Ministers in the previous Government. I hope the new Government will look at this and attempt to bring about a change. We have so many excellent public companies to invest in and support in this country.
Thirdly, I turn to ISAs, which of course have been a huge success, and their precursor, PEPs. I have been a big supporter and, I declare, a beneficiary. I supported the principle of Jeremy Hunt’s £5,000 British ISA, but frankly it was rather a damp squib, being too small and administratively messy in that people would have to open a separate ISA. I believe that all future ISA sales and new monies going into ISAs should be restricted to UK-quoted companies. Why give tax breaks to those investing abroad? They are still free to invest abroad, but why do we give them tax breaks to enable them to do it? I am not suggesting that they should have to divest any existing overseas holdings, because that would be too messy administratively, and unfair retrospectively.
Viscount Colville of Culross (CB)
My Lords, as many other noble Lords have said, artificial intelligence will revolutionise our economy and our society during the next decade. It will radically improve our productivity, research capability and delivery of public services, to name but a few, so I am pleased that the digital information and smart data Bill will enable innovative uses of data to be safely developed and deployed.
I hope that this Bill will begin to address the wider risks AI poses to us all unless it is developed and released safely. This Government need to ensure that AI develops to support our economy and society, and that it does not take society in dangerous and unintended directions. At all stages of the training and deployment of AI, there are economic and social risks. There are dangers the whole way through the supply chain, from the initial data ingestion of the massive datasets needed to set up these foundation models to their training and deployment, which I hope will begin to be addressed by the Bill.
My concern is that there can be differences in the inputting and modification of AI models that humans do not consider significant, but which could have major and possibly adverse effects on the behaviour of AI systems. It is essential that formal verification techniques are guaranteed throughout the whole process to prove their safety at all stages of the process.
However, the massive costs of training and developing these models, which can run into billions of pounds, have put huge pressure on the tech companies to monetise them and to do so quickly. This has led to rapid developments of systems, but underinvestment in safety measures. Many of us were impressed when at the Bletchley summit last year the previous Government obtained voluntary guarantees from the big AI developers to open up their training data and allow the latest generative AI models to be reviewed by the AI Safety Institute, allowing third-party experts to assess the safety of models. However, since then the commitment has not been adhered to. I am told that three out of four of the major foundation model developers have failed to provide pre-release access for their latest frontier models to the AI Safety Institute.
The tech companies are now questioning whether they need to delay the release of their new models to await the outcome of the institute’s safety tests. In a hugely competitive commercial environment, it is not surprising that the companies want to deploy them as soon as possible. I welcome the Government’s commitment during the election campaign to ensure that there will be binding regulation on big developers to ensure safe development of their models. I look forward to the Secretary of State standing by his promise to put on a statutory footing the release of the safety data from new frontier models.
However, these safety measures will take great expertise to enforce. The Government must give regulators the resources they need to ensure that they are effective. If the Government are to follow through with AI safety oversight by sectoral regulators, I look forward to the setting up of the new regulatory innovation office, which will both oversee where powers overlap and pinpoint lacunae in the regulation. However, I would like to hear from the Minister the extent of the powers of this new office.
I hope that at next year’s French summit on AI the Government will be at the centre of the development of standards of safety and will push for the closest international collaboration. There needs to be joint evaluations of safety and international co-operation of the widest kind—otherwise, developers will just go jurisdiction shopping—so the Government need not just to work closely with the US Artificial Intelligence Safety Institute and the new EU AI regulator but to ensure transparency. The best way to do this is to involve multi-stakeholder international organisations, such as the ISO and the UN-run ITU, in the process. It might be slower, but it will give vital coherence to the international agreement for the development of AI safety.
I am glad to hear the Minister say that the Government will lead a drive to make this country the centre of the AI revolution. It is also good that DSIT will be expanded to bring in an incubator for AI, along with the strategy for digital infrastructure development. I hope that this will be combined with support for the creative industries, which generated £126 billion of revenue last year and grew by 6%, an amazing performance when we look at the more sluggish performance of much of the rest of the economy. I hope that members of the creative industries will be on the Government’s new industrial strategy council and that the government-backed infrastructure bank will look not just at tangible assets but at the less tangible assets that need supporting and encouraging across the creative industries.
To bring together AI and the creative industries, the Government need to develop a comprehensive IP regime for datasets used to train AI models, as the noble Lord, Lord Holmes, just told us. There has been much in the press about the use of data without the creator’s consent, let along remuneration. I hope that DSIT and DCMS will come together to generate an IP regime that will have data transparency, a consent regime and the remuneration of creators at its heart.
I hope that the gracious Speech will lead us into an exciting new digital area where Britain is a leader in the safe, transparent development and rollout of a digital revolution across the world.
Baroness Blackwood of North Oxford (Con)
My Lords, I declare my interests as chair of Genomics England and Oxford University Innovation, as well as a board member of BioNTech and RTW Biotech Opportunities.
I welcome the noble Lords, Lord Vallance and Lord Livermore, and I congratulate the noble Lords, Lord Vallance and Lord Petitgas, on their outstanding maiden speeches. As a former colleague, I can testify to the integrity and expertise of the noble Lord, Lord Vallance, although I fear that he may look back on Greenbottom as his first missed opportunity.
I welcome the focus on high-value growth set out by the Minister. However, our current economic models fail to account for health as a critical factor in economic growth. We need a new approach. Imagine a health balance sheet where the true economic value of health and the cost of ill health are clearly articulated. Such a model would highlight the preventive benefits of healthcare interventions, even those that add short-term costs, by showcasing their long-term economic gains.
It is understandable that discourse around healthcare is overwhelmingly focused on urgent pressures such as waiting lists and GP services. While these issues need answers, too narrow a focus risks a cycle of short-term fixes. This may relieve immediate stress on the NHS, but it will not address the root causes of our healthcare challenges. I look forward to the recommendations of the Darzi review.
We often debate the acceleration of ageing and chronic disease across our population, with 3 million rising to 4.4 million people over the age of 80 by 2030 and two in three over-65s living with multiple health conditions by 2035. These trends place immense pressure on our healthcare system. We have heard of 2.9 million working-age people being economically inactive due to ill health, costing the Government an extra £70 billion a year. Economic modelling published last month by the TBI found that reducing the incidence of six major diseases by 20% could raise GDP by almost 1% over 10 years. That equates to £26.3 billion annually. We know that regions with poorer health outcomes experience lower economic activity. Addressing these disparities not only fulfils a moral obligation but unlocks economic potential across the nation.
To counter these trends, we need a fundamental shift from treating illness to preventing it. This means investing more in upstream R&D and university spin-outs, as set out by the noble Lord, Lord O’Neill, early detection, innovative treatments and preventive care. Currently, although our healthcare spend is comparable with other G7 nations, we spend heavily on acute care and lag in areas that would reduce long-term costs. For example, despite recent efforts, the UK still has less than a quarter of the number of MRI, CT and PET scanners per million people than comparator countries. We know that earlier diagnosis is key to better outcomes, and we must do better, so I was delighted to hear the new Health Secretary commit his department to this agenda. But if we want meaningful progress, isolated action by health and care budgets will not be enough. How will the Minister align non-DHSC prevention and care budgets and co-ordinate them with science and innovation spending through the industrial strategy, the Mansion House reforms, the national wealth fund and, of course, Treasury accounting?
Investing in advanced diagnostics and new therapeutics that actually reach patients significantly improves health outcomes and reduces demand because patients either get better quicker or are well managed, and that in turn keeps them in work and enhances productivity. Direct investment in life sciences and health tech stimulates further innovation, creating a positive feedback loop of health and economic gains.
We in the UK are uniquely positioned to lead this transformation. We have a single-payer health system with universal coverage and comprehensive datasets; these are ideal for data-driven health innovations. Initiatives such as the Genomic Medicine Service and the Generation Study have the potential to revolutionise healthcare delivery and set global standards, not to mention the growth engine of our globally competitive university innovation clusters.
It is time to re-evaluate how we think about health and its role in our economy. Health is not just a public service issue; it is fundamental to our economic strategy. The health of our nation is the wealth of our nation. Let us get to work in unlocking it.
Lord Touhig (Lab)
My Lords, I join colleagues in the House in congratulating my noble friend Lord Vallance on his maiden speech. I felt after listening to him that this is a Minister who will be happy engaging with Members of this House; we welcome that. I also congratulate the noble Lord, Lord Petitgas, on a lively and fresh contribution. We look forward to many more from him in the months to come. I also look forward to the winding-up speech of my noble friend Lord Livermore. He and I go back a long way, to a time when we were working with Gordon Brown in the early days of the Labour Government in 1997.
I take this opportunity to raise the matter of support to help young people with learning disabilities and autism gain employment; the noble Lords, Lord Shinkwin and Lord Holmes, have already touched on these matters. If we are to meet the Government’s ambition to grow our economy, we can ill afford to ignore the skills and talents of tens of thousands of our fellow citizens who cannot get a job because they have a learning disability.
Seven out of 10 people of working age who have a learning disability are unemployed—denied the opportunity of an independent life and the sense of life-fulfilling achievement that work brings. Businesses across Britain are denied the benefit, enthusiasm, skills and commitment of this group. More than that, helping them find work reduces a cost to the Exchequer.
The Fair Shot café in Covent Garden, which operates a training scheme exclusively employing people with learning disabilities and autism, said in an impact report that its programme had saved the taxpayer £210,000 in benefits.
Lord Touhig (Lab)
Yes, there is very good coffee there too.
For years, Governments have sought to reduce the disability employment gap. In 2017 the last Government set the goal of helping 1 million disabled people into work by 2027. To be fair, there has been progress—but it is not enough. I desperately hope that this Labour Government will do two things: first, launch a major drive to encourage employers to offer jobs to people with learning disabilities and autism. There are many good examples of businesses that have done this, and we need them to provide mentors to encourage others.
A good start would be to look at a recent report on employment with autism written by Sir Robert Buckland, who as an MP chaired the All-Party Group on Autism. One of Robert’s key recommendations was explained under the heading “changing employer behaviour”.
I have spoken to many businesspeople. In almost every case there is a willingness to employ a person with learning disabilities, but also a reluctance: how will my staff cope working with a person with learning disabilities? What if they do not fit in? What support do I have to provide to them? Is there any financial support to employ a person with learning disabilities? Are there any examples of where employing a person with learning disabilities has worked out? These are perfectly reasonable questions. I urge His Majesty’s Government to launch a programme of recruiting mentors who have run businesses that have employed people with learning disabilities and autism. With their co-operation and support, I am sure we will persuade more businesses to do the same and help grow the economy—a key objective of the Government.
Secondly, we need to improve the operation of the Access to Work fund. This fund helps people with learning disabilities and autism get the right support to get into work, but its budget has been underspent in three years out of the last five. The Government need to work closely with supported employment providers. In partnership with employers, schools and colleges, they help to create supported internships. A supported internship is often the catalyst that gets a person with learning disabilities into work. It provides the opportunity and support to turn their potential into practical work skills that help them to start a career and further develop their social, emotional and self-advocacy skills. Access to Work plays a vital role in facilitating these internships. Its funding is a key part of the service offered by supported employment providers.
However, employment support providers are facing considerable difficulties with the process. While initial stages work well, including planning for funding approvals, they experience considerable delays when other things are to be processed. In addition, they are facing significant issues when they come to processing claims and receiving funding. There are issues about basic things such as timesheet requirements and concerning the receipt of paperwork. I could go on. I have to say that Access to Work is also a poor communicator with the people it is supposed to be helping. Should he wish, I can give my noble friend the Minister more information, but it would take up too much time for me to do that now.
We need a nationwide scheme to make real progress here—a national strategy with clear and achievable objectives. That objective can be summed in one sentence: to change employer behaviour. That would do more than anything to reduce the disability employment gap, and if we do that we will grow the economy.
Lord Lebedev (CB)
I welcome the noble Lords to the House and congratulate them on their brilliant speeches. Mine follows on perfectly from those made by the Minister, the noble Lord, Lord Vallance, and the noble Baroness, Lady Blackwood.
I am delighted to speak in this debate on the gracious Speech as the new Parliament opens. I want to turn the attention of your Lordships’ House to an emerging field that can unlock huge benefits for Britain: longevity research. I declare my interest as a trustee of the Hevolution Foundation, which is on the register. Our country faces a medical crisis. As life expectancy increases, the proportion of time spent in good health is going down. We must urgently develop a new approach to medicine, one that tackles the root causes of diseases, many of which—including heart disease, diabetes and Alzheimer’s—are fundamentally the same, according to the latest research.
The discovery of the 12 hallmarks of ageing, including the loss of stem cells and metabolic dysregulation, is central to our understanding of what drives age-related disease. Also, a ground-breaking new theory suggests that ageing is driven by the loss of vital regulatory information within ourselves, rather than primarily by the accumulation of damage over time, as previously thought. Through epigenetic reprogramming, we could potentially reset our body’s tissues to a more functional state. Scientific studies have already reversed vision loss in mice, and human trials are set to begin next year.
There is the discovery of drugs called senolytics, which reverse aspects of ageing while eliminating the senescent zombie cells that contribute to chronic disease and cancer. Cutting-edge breakthroughs such as these, driven by labs right here in the UK, are informing how we tackle the underlying factors behind ageing rather than just tackling symptoms. We are standing at the precipice of a medical revolution catalysed by medical monitoring devices, genomics and the understanding of what drives ageing. Britain can become a global leader in longevity science, and capturing this beachhead would benefit us both socially and economically.
I urge noble Lords to consider the economic benefits. In the UK the cost of age-related diseases is staggering, amounting to billions of pounds annually. Dementia alone costs the UK economy £34.7 billion a year, and the economic burden of age-related diseases is projected to rise rapidly as our population continues to age. Just imagine: by developing therapies that reverse age-related diseases, we can allow people to live not only longer but, more importantly, in good health. The Office for National Statistics estimates that increasing the state pension age could keep people working longer and add £55 billion annually to the UK economy. Just a 20% reduction in six major diseases would lead to an annual GDP boost of almost £20 billion, according to Andrew Scott of the Global Institute.
Obesity treatment has been revolutionised through breakthrough drugs such as Wegovy, which address the underlying causes rather than just the symptoms. While Denmark’s Wegovy and Ozempic are shrinking the waistlines of celebrities, they are swelling Denmark’s economy and its GDP is predicted to grow 2.1% just this year thanks to these drugs.
We need a paradigm shift. We should approach ageing with the same mindset, tackling it as a medical condition in itself, not focusing solely on downstream illnesses. By becoming the first country to treat it as a medical condition, we can chart a course for more effective interventions and improved health outcomes —a future where ageing no longer means an inevitable decline but instead is a continued opportunity for vitality and productivity, well into our 80s and beyond. The science is now moving as rapidly as the AI revolution and will be similarly if not more impactful, so it deserves just as much attention.
Lord Gadhia (Non-Afl)
My Lords, I note my interests as a board member of the Bank of England and the housebuilder Taylor Wimpey, but I speak in a personal capacity.
Over the weekend, I read an article that began:
“Moments of change usher in moments of hope”.
That certainly feels like the zeitgeist surrounding the new Government and King’s Speech. Cynics will no doubt presage the triumph of hope over experience, so it is encouraging to see the incoming Administration making a sure-footed start, following through on promised non-legislative reforms—notably making changes to the planning framework and unwinding many of the previous Government’s own goals on local housing plans and targets. Indeed, planning reform to boost housebuilding and infrastructure should rightly form a crucial component of the growth agenda, especially given the domestic multiplier effects, while also recognising that they can provide only one aspect of the Government’s central mission to accelerate economic growth and promote wealth creation.
Tackling the fundamentals of economic productivity is a topic that attracts many and varied viewpoints, as today’s large speakers’ list and contributions testify to. So here are my few pennies’ worth. First, you cannot legislate for growth. That may be axiomatic, but legislators are often like people who possess a hammer and view everything as a nail. That said, strengthening the OBR is helpful insurance against the type of behaviour we saw in the ill-fated mini-Budget of October 2022, and it should, I hope, capture a credibility discount from holders of UK government debt—instead of the so-called moron premium we witnessed at the time.
With respect to audit and governance reforms, the creation of a new accounting regulator is both welcome and overdue, but I caution against piling on new statutory governance requirements. Instead, the replacement body for the Financial Reporting Council should be allowed to reform the UK’s corporate governance and stewardship codes—it has already started this, in consultation with the relevant stakeholders—with a firm eye on our global competitiveness as an investment destination.
This leads on to the second set of observations. We know that UK investment has lagged behind our OECD competitors for decades. The previous Government tackled both the supply and demand sides of this equation but found it painfully slow to shift the dial. Full expensing of capital expenditure, now permanent, should produce positive results over time. The Treasury should ensure that qualifying assets are defined broadly enough to include the types of intangible investments that are necessary for a predominantly services-based economy in an increasingly AI-driven world. In parallel, shifting the economy-wide asset allocation to higher-return investments should also make a difference, but this requires pension and insurance reforms to be followed through and risk appetite to change. The national wealth fund adds another well-intentioned initiative but is still a pea-shooter compared with the scale of investment required.
So what should we do? Therein lies part of the problem. It is easy to bemoan the absence of radical reforms, but a period of “boring” is good for investment —even more so given the political instability across many parts of the world, including our nearest neighbours in Europe. Apart from hygiene measures, including reinstatement of the Industrial Strategy Council and implementation of the Harrington Review of Foreign Direct Investment, we need a period of predictability, certainty and consistency. These are the three most important words to help restore investor confidence. That is what the noble Lord, Lord Petitgas, attempted during his brief time at No. 10, and I congratulate him warmly on his excellent maiden speech. His newly appointed successor, Varun Chandra, is extremely well placed to continue this.
Finally, it has become fashionable to comment on the challenging economic inheritance, no doubt borrowing from George Osborne’s playbook after the 2010 election. The current reality is more mixed and nuanced. Yes, the spending pressures are significant, especially on health and defence, plus there are higher expectations for public sector pay and welfare benefits. But many economic indicators are also starting to turn. In addition, the fiscal drag from freezing tax thresholds will do a lot of the heavy lifting on raising tax revenues—so, come the autumn, the Chancellor may well have more wind in her sails than she is willing to admit right now. Let us hope that luck and wisdom remain on her side, because the alternative options for raising taxes, given the manifesto lock on income tax, national insurance and VAT, all look very unappealing, and could damage incentives for wealth creation and risk choking off growth before it has properly begun.
In warmly welcoming the noble Lord, Lord Vallance, I urge him and the noble Lord, Lord Livermore, to take away three words from today’s debate: predictability, certainty and consistency.
Lord Sarfraz (Con)
My Lords, I congratulate the Minister and my noble friend Lord Petitgas on their excellent maiden speeches. Both played an incredible role in government over the last few years. I welcome the Government’s economic growth strategy and wish the Front Bench the very best in their new roles.
As noble Lords will know, SMEs are our economic backbone; 99% of our businesses in this country are SMEs, and 60% of our private sector workforce are employed by SMEs. A lot of very exciting innovation happens in SMEs across the country, not just in the R&D labs of big companies. However, SMEs need cash to continue to grow and innovate.
One way in which SMEs have accessed cash in this country is through the Alternative Investment Market, to which the noble Lord, Lord Lee of Trafford, who is not in his place right now, referred. AIM has been admired around the world since its launch 30 years ago. Many countries have tried to replicate it, with some success, but they have not been able to nail what AIM was able to do over the past 30 years in this country. It is a fascinating concept for providing a public market with a deep pool of capital investors access to growth companies. There are a whole bunch of very successful stories that have come out of AIM, which have grown to be big, multi-billion-dollar businesses with tens of thousands of employees all around the world.
AIM is one key indicator of the overall health of the SME system, but the market is now struggling. It has been in gradual decline over several years. Twenty years ago, there were 1,700 companies listed on AIM; today that number is just over 700. Companies are de-listing—80 left just last year—and fewer companies are going public. There are fewer brokers and investors, with less liquidity in the market. It is expensive to go public and stay public. Valuations are much lower than in other exchanges—and then there is the issue of zombie companies, which can raise a few hundred thousand pounds a year to keep the lights on but cannot do much else.
Interestingly, this decline is uncorrelated to stock market volatility in general; it is unique and structural to AIM. It is clear that the market needs love and attention; we need to breathe life into it, and we need to do it now. It may have been a unique SME platform when it started, but is it fit for purpose for the next 20 years? I hope that the Government will evaluate how we can continue to provide deep pools of institutional capital and access to innovative companies and what role AIM might play in that—and the market is a problem for the whole country, not just for the City of London.
One practical step that the Government can take is to mandate the new national wealth fund, the British Business Bank and others, to invest in AIM companies as part of the larger strategy. That will help to crowd in capital. If the wealth fund has confidence in AIM, others will too. But to truly transform AIM, it will need a total reset, not incremental improvements. It will take effort, but there is absolutely no doubt that it is worth having a vibrant capital market for young, promising companies.
Lord Sikka (Lab)
My Lords, I welcome new Ministers and Peers to this House and I look forward to working with them. There is much to admire in the King’s Speech, but I have a few questions.
I support bringing passenger rail services into public ownership. Can the Minister explain what will happen to those franchise agreements which do not expire within the next five years? These include contracts with East Midlands Railway, CrossCountry and the west coast operator. Will the Minister say something about the cost to the public purse of leaving freight and rolling stock companies, commonly known as roscos, in private hands? Just three companies, Angel Trains, Eversholt Rail and Porterbrook, own 87% of the rolling stock, which is leased out to train companies. All three have complex corporate structures, controlled from an entity in Luxembourg, which obviously means tax dodges, and 100% of their income is derived from the public purse. In the last decade, roscos have paid £2.7 billion in dividends; they have a profit margin of 41.6%; and no UK tax is paid on any of their dividends. I am sure the Minister will find this abuse unacceptable and will act very swiftly. The profiteering by roscos can be ended by purchasing rolling stock directly from manufacturers, or by setting up a new publicly owned entity to replace the existing roscos. I hope the Minister will give us a timetable for ending this abuse.
The £7.3 billion national wealth fund to boost investment is welcome, but it is not really enough to fuel the economic revival that the Government seek. The Government hope to secure £3 of private sector investment for every £1 of public money. Can the Minister please explain what returns the Government are guaranteeing to the private sector for that investment? The Government are effectively resuscitating the private finance initiative, which ran from 1992 to 2018 and secured investment of £60 billion in return for repayments of £306 billion from the public purse. Successive Governments effectively acted as guarantors of corporate profits. Inevitably, each £1 of private investment through the national wealth fund will result in repayment of £5 to £6 from the public purse but, happily, there are alternatives. These include creating new money, as modern monetary theorists suggest; engaging in quantitative easing; borrowing, especially as the cost of borrowing by government is always lower than the cost incurred by the private sector; and the Government can also eliminate tax anomalies and tax the ultra-rich. Will the Minister publish data showing how the Government evaluated these alternatives? That would be very helpful.
It is also very disappointing, at least from my perspective, that the Tory Government’s two-child benefit cap, which affects 1.6 million children, has not been abolished. There is no shortage of money. Just last week, the Government promised to increase military spending and promised £3 billion a year in military support to Ukraine. They are also ready to hand new money to Tata Steel as well. The formation of the child poverty task force should not preclude removal of this cap. There is no point in prolonging the misery for millions of children. If the Government are looking for new resources, I can help. They can raise about £14 billion by taxing capital gains at the same rates as wages and levying national insurance on the same. This one change alone would enable them to finance the national wealth fund, without private money, in one go, in one year; abolish the two-child benefit cap; and provide free school meals for all children. What objection could the Minister have to this suggestion?
Lord Udny-Lister (Con)
My Lords, I congratulate the noble Lord, Lord Vallance, on both his maiden speech and his appointment as Science Minister. Having worked with him in Downing Street, I cannot think of anybody better qualified to fulfil that role.
In the short time I have, I will draw on three areas: economic development, international trade regulation and the new national wealth fund. On international trade, it will come as no surprise that all the talk of resetting the UK’s trade and investment relationship with the EU has caused much concern that the new Government will seek opportunities to reverse the Brexit process and set the UK on a course for ever greater alliance with the European Union. I fear not only that any shift in this direction would undermine the democratic will that was mandated by the British people in 2016 but that ever closer alignment, particularly on regulation, would stunt the growth and innovation space that our businesses so desperately need against the backdrop of these most challenging economic circumstances.
I have long said in your Lordships’ House that excessive regulation strangulates our businesses from achieving their maximum output and I therefore caution the new Government to think carefully before locking the UK’s businesses into new and excessive EU regulation. If His Majesty’s Government are sincere in their desire to secure the highest sustained growth in the G7, they must think seriously about the negative consequences that EU regulation has had on our businesses in the past and how the world is tilting towards the Indo-Pacific—we are, after all, now members of the CPTPP—which in the next 10 years will represent approximately 40% of trade, compared to the EU, which will represent only 18%. Greater alignment with EU regulations and rules, therefore, may not be in the best interest of the many thousands of SMEs which underpin the nation’s prosperity and ability to deliver future job creation.
The previous Government were committed to a global outlook when it came to international trade, and there remain many compelling reasons why we must continue to look outwards. In this interconnected world, the future prosperity of the nation depends on our ability to engage fully with the world. Now is not the time to become insular. We should be bold and pragmatic in our approach. I therefore hope that any trade strategy produced by the Government will seek to build on the time-proven principle that free trade is the mechanism that delivers growth and prosperity to our island home. Correspondingly, trade barriers and unnecessary tariffs work against efficiency and good value.
In the short time I have left, I also want to congratulate the Minister on his commitment to the new national wealth fund. However, £7 billion is a paltry sum. However, having been involved when working at No. 10 with getting the Treasury to commit £250 million to the joint life sciences fund with the UAE, I can only begin to imagine the battles that have already taken place and will, I am sure, come in the near future. Just to put it in a little bit of context, if I may, the UAE through its sovereign funds has already invested £16.5 billion in British infrastructure and companies, so we have a long way to go.
The new national investment fund must have a clear remit to match funding and use its leverage to encourage others to go into areas where they need to see some government commitment to both reduce risk and show commitment. That last point is so important. If the British Government will not show commitment to something, why on earth should an overseas sovereign fund start to show commitment to this country? We need to be able to put money on the table. The last Government’s investment was a good case in point, with the £500 million they invested in OneWeb when it was going under. The company was rescued because of that £500 million. The money that it was then able to raise, another £2.5 billion, was enough to save the business and, incidentally, the Government made money out of it.
In a year’s time, I hope we can see that the £7 billion, plus other moneys, have been deployed in areas where the private sector needed some support. I, for one, will not complain if sensible risk is taken and we do not get the results in the short term that we want, but I will be highly critical if, at the end of this term, we find that the investment fund still has money in the bank and has not been deployed.
Baroness Bowles of Berkhamsted (LD)
My Lords, I declare my interests in the register, in particular as a director of the London Stock Exchange. Like other noble Lords, I welcome the new Ministers to their place. I also welcome the gracious Speech and will participate on several Bills, but now, I want to mention some extras.
First, will the Government bring forward the consultation on a UK captive insurance regime that was in preparation before the election? Captives fit well with City expertise, and we could service the UK market and attract international business.
Secondly, will the Government fix the glitch in cost disclosure presentation that has ravaged the listed investment company sector? Lost investment, largely for real assets such as infrastructure and renewable energy, is now at £30 billion and counting. The noble Lord, Lord Livermore, was supportive in the last Parliament, including of the Bill of the noble Baroness, Lady Altmann, which would have dealt with the issue.
This Session, I have got the draw to introduce a PMB. It will be based on the hugely supported joint industry response to the relevant statutory instrument consultation. The focus is on recognising the role of markets in setting the value of these listed investments and of going concern status in the making of FCA rules and legislative interpretation. Will the Minister meet me to discuss these solutions and how to end the disaster that is hitting a third of the FTSE 250?
Thirdly, do the Ministers appreciate the need to change public procurement methods to meet the Chancellor’s plans for growth, especially for growth companies that could multiply their earnings and British prosperity through export? Presently, the procurement process can retard rather than help growth, which I will explain. Very little government or local authority procurement is from small or growth companies, and even when capable of building revenue, they are pushed into further innovation grants rather than accelerated to commercialisation.
Risk aversion is prevalent in both public and private procurement, with default to incumbents and big business. The old saying of “nobody is sacked for buying IBM” is now for buying Google, Amazon, Microsoft or CrowdStrike. It could have been so different for Graphcore and Darktrace if that were not the case, and now their wealth generation is lost to the UK.
On the public side, system integrators—consultants —do the procurement that used to be in the Civil Service. In addition to risk aversion, the system integrator model also destroys its intellectual property, or ends with system integrator ownership, stripping new companies of their basis for growth and export opportunities.
In future, AI will play a big part in public sectors, including transport and infrastructure, where government or local authorities are the only procurers. There are innovative, homegrown companies that could scale and export solutions, including to the US, but with present systems, it is unlikely they will be procured or stepped up to sustainable commercialisation.
Interested US entities say to those companies, “Show me your first UK deployment and then I’ll buy in”, but UK procurement does not happen, so the technology goes up for sale, or the company relocates to the US to get deployed and stays for stock market listing. The US attraction is about procurement as much as it is about investment.
Regulators have the same “big guys” bias: happy smiles if you use the US giants, wrinkled brow and big due diligence demands if you try smaller or newer. Maybe after CloudStrike, the systemic risk will be recognised, not to mention the competitive distortion.
Procurement failing to support growth is a systemic issue needing a co-ordinated response across departments. Will Ministers therefore meet with me and interested parties such as the ScaleUp Institute to examine the evidence and possible remedies?
Lord Fairfax of Cameron (Con)
My Lords, I too congratulate the two main speakers on their impressive —or, in the case of the noble Lord, Lord Petitgas, perhaps it is better to say “formidable”—maiden speeches. I also declare an interest as the co-editor of a forthcoming book, to be published by Springer Nature, on the future of artificial intelligence.
In the King’s Speech, the new Government said that they will
“seek to establish the appropriate legislation to place requirements on those working to develop the most powerful artificial intelligence models”.
That is more than the last Government were willing to do, but it is still not an AI Bill. Given that the leading tech companies continue to compete fiercely against each other to be the first to achieve artificial general intelligence, for the sake of the world I sincerely hope that this proves to be the right approach, especially as the Government’s safety institutes and tech ministries are still playing catch-up on AI, especially its frontier models.
However, what I really want to address very briefly this evening is the future of jobs and work as the AI wave starts to wash over the world, and to hope that this new Government will devote the necessary time and resources to think about and plan for the potentially massive employment, economic and societal consequences of that wave.
Discussions about the possible need for a universal basic income have been around for years. More recently, McKinsey wrote about the future of work in the new world of AI eight years ago and has just done so again, including a finding that by 2030 up to 30% of hours worked in the world could be automated. Goldman Sachs wrote last year about the possible loss of 300 million jobs worldwide to AI and automation, and just last week my noble friend Lady Moyo wrote:
“many fear that AI will contribute to long-term structural unemployment, creating a jobless class that will include both skilled and unskilled”
labour. At the extreme, Elon Musk has expressed the opinion that in future AI will take all human jobs, because it will be able to do them more cheaply and efficiently than humans can.
The societal impact of any of these scenarios is potentially seismic for this country and the world. I emphasise that I am not falling into the trap of not taking into account the many new jobs that AI will create that did not previously exist—head of AI positions and prompt engineers, to name but two. However, many very informed people consider that this time is different, so because the societal and employment impacts of this AI wave will be so seismic, I hope that this new Government will start to think seriously and deeply about planning for the new world of AI, which we and the rest of the world are just entering.
Baroness Morgan of Huyton (Lab)
My Lords, I am delighted to be able to speak, albeit late, in response to the gracious Speech from a Labour Government for the first time in 14 years, and I am very pleased to see such talented Ministers on the Front Bench today.
I draw attention to my interests as set out in the register: master of Fitzwilliam College, Cambridge, current chair of the Royal Brompton and Harefield hospitals as part of Guy’s and St Thomas’, and chair-designate of Cambridge University Hospitals from the new year.
This is an ambitious Government, who now have the opportunity to deliver real and important change for the UK. However, we all know that it will be very hard and will demand absolute focus on priorities. Tough decisions will need to be made. I know from sometimes bitter experience that there are few easy decisions, but to govern, especially in challenging times, is to take those decisions in a clear-sighted and informed way. It is to say no as well as yes, but to be able to explain why.
This Labour Government have rightly made economic growth their most important mission in government. It underpins everything that we want to see change. It is great that Britain’s first female Chancellor, Rachel Reeves, is at the centre of this.
We need to recognise and invest in the engines that can propel the UK forward. Universities around the four nations are such engines and their contributions are far-reaching, and not just as educational institutions: they are the backbone of city and regional economies, and vital to the UK’s economic infrastructure and success. Each year, universities in the UK contribute £130 billion to the UK economy and support more than 760,000 jobs, training more than 100,000 public service workers, including nurses, medical specialists and teachers.
Of course, not all universities are the same, and nor should they seek to be, but in different ways, in different communities, they all have economic impact and, crucially, the potential to play a more significant role. They will need insightful and sustained challenge and support to make the necessary plans and reforms that will help to maximise their contribution economically. That must not be simplistic; it is about a lot more than current skill needs.
I will talk briefly about the role that Cambridge, as an example, has played as part of the system. Cambridge University’s net total economic impact on the UK economy is nearly £30 billion annually, supporting more than 86,000 jobs across the UK. For every £1 spent, Cambridge generates nearly £12 of economic impact. That has not happened by chance, but through a deliberate fostering of excellence in research and innovation. Cambridge has developed an ecosystem that fosters the successful commercialisation of these ideas.
The innovation is not just academic, significant though that is to the UK’s global standing; £23 billion of Cambridge University’s economic impact is generated by companies spun out from or closely associated with the university. This has helped to transform Cambridge into one of the world’s leading innovation clusters. It is now ranked first in the Global Innovation Index for the intensity of its science and technology cluster.
All of this generates substantial economic benefits for the region and the UK. The Greater Cambridge economy returns around a £1 billion net contribution to the Exchequer each year, increasing the resources the Government have to invest in the UK’s wider priorities.
However, and importantly, universities such as Cambridge not only benefit their local region but can have wider effect by working together. Over the last year, the new Growing Together Alliance was created, the centrepiece of which is the direct partnership between the Manchester and Cambridge innovation clusters. Two of the four biggest companies in the UK— global heavyweights, if you like—are headquartered in Cambridge: AstraZeneca and Arm. Crucially, though, AZ employs more people in the north-west of England than it does in Cambridge. Arm’s biggest UK presence outside of Cambridge is not in London; it is in Manchester.
This collaboration between Cambridge and Manchester therefore exemplifies how regional partnerships can enhance national economic growth across the country. It is strongly supported by both local mayors, Nik Johnson and Andy Burnham. Working together is good for both Cambridge and Manchester, and good for the UK. By leveraging each other’s strengths, these cities are creating a more interconnected and resilient economic landscape. That results in more good jobs created each year in future-facing sectors up and down the country. Cambridge’s internationally recognised academic excellence, scale-up ecosystem, early-stage investment and inward investment complement Manchester’s extensive research base, large talent pool, relative affordability and capacity for growth. They are stronger together.
Universities are not just educational institutions but pivotal players in the national economy. They are instrumental in developing the talented workforces and innovators of tomorrow as well as today, contributing to regional and national growth. But that will not happen without real engagement from the Government, so I urge them to commit to work with the UK’s HE sector to realise that potential in the coming decade.
Viscount Goschen (Con)
My Lords, this has been a classic House of Lords occasion and debate. I might say that the Minister, the noble Lord, Lord Vallance, completely nailed his maiden speech and set the tone. He held the attention of the House in a remarkable way: one could tell that by the quiet around the Chamber as people listened extremely carefully to what he had to say. I wish him and his colleagues—some new faces and some distinguished faces we have seen in previous incarnations—success in most but not entirely all of their endeavours.
I also pay tribute to my new noble friend Lord Petitgas, who made an extraordinary maiden speech. He spoke with passion, wit and charm, and a lifetime of knowledge of investment banking and related sectors. I feel absolutely certain that we will hear a lot more from him once the House has decided how to pronounce his surname. No doubt a Select Committee will be set up quickly to do that. If it was not against the provisions of the Standing Orders to speak in a foreign tongue, I would say “chapeau” to him—but obviously I will not take that liberty.
It must be rare at the start of a new Government, after the preceding Administration have been in power for a long time and after a vigorously fought elect campaign, for there to be such consensus around the Chamber. From most of what has been talked about today, one has the strong sense that the overall objectives are shared—if not necessarily the mechanics of how to get there. I feel that is very refreshing.
I am particularly pleased that the Prime Minister has placed economic growth front and centre of the Government’s agenda. I think it is worth emphasising how resilient corporate performance has been over the past few years in the face of the major challenges of energy price rises, interest rate volatility, Covid, trade regulation with key partners, supply chain pressures, profound changes in technology and global political uncertainty, instability and conflict. None the less, there is a significant challenge to what the Government can do to deliver what they have said they are going to do.
This is one concern I have: expectations are very high of the Government’s ability to deliver growth. Although government has an incredibly important role, perhaps the emphasis might be as much on creating the framework for business to create sustainable value, which in the final analysis will be the real creator of wealth in the country, rather than on government being able to make interventions and pull levers, with the exception of some that we have covered in previous debates on the planning system and so forth. Surely the role of the Government—again with the exception of areas where there is a particular strategic national interest—to intervene to create growth drivers is extremely limited and the law of unintended consequences works pretty hard in this regard. Therefore, I was much encouraged by the emphasis on partnership with businesses, and no doubt their requirements and perspectives have been well received already by government departments and Ministers.
However, there is very little that is new here. The requirements of business are much the same as they were before the 4 July election, as indeed is the expertise of officials in the relevant government departments. My concern therefore is that, once the honeymoon period for the new Administration has worn off and the challenge of delivering sustainable economic growth has become very clear, there will be pressure for the Government to pursue more novel interventions. I think that would be regrettable. I have real trouble equating innovation, agility, risk-taking and technological innovation with more legislation, statutory government bodies and regulation. I am not sure they are perfect bedfellows.
My final point is that this has been a very domestic debate, whereas what we have to consider is the UK’s international competitiveness. Every regulatory intervention must be considered in that context. By far the majority of FTSE 100 revenues are international and every aspect of our business system is interconnected with the global economy, so we cannot look at these matters in isolation.
Lord Berkeley of Knighton (CB)
“Ich fühle Luft von anderem Planeten”,
or “I feel air from another planet”. So begins the movement of the second Schoenberg string quartet, in which Schoenberg broke the mould by adding a soprano to the conventional four players and created music of radiant transcendence. The text is a poem by Stefan George. Listening to our debates over the last few days, I have felt a sense of optimism, of fresh air, not simply because of a sound start by the new Government but, importantly, by the reaction of most Members of the Opposition, as we have just heard. For instance, in the housing debate on Friday, there seemed to be a sense of relief that we will now get on with policies that had tended to stagnate.
What has unquestionably been allowed to stagnate is the arts, and music in particular. Creativity is a multi-billion-pound input to our economy but, more important still, an investment in our cultural identity, informing us of who we are and how we fit into today’s world, an investment in social cohesion no less. It is all too clear that in the last 13 years we have seen an appalling diminution of the arts, from education at primary level right through to university and onwards to arts institutions, festivals, theatres and opera houses—like Welsh National Opera, currently teetering on the brink of a “to be or not to be” conundrum. Will the musicians of WNO be rescued, even at this late hour?
I want to be fair. Covid was a hammer-blow to an already fragile economy, and Rishi Sunak as Chancellor did his very best to support the creative sector. Unfortunately, the people who slipped through the net were freelance musicians, and it is precisely they who have been most severely affected by the utter catastrophe that is Brexit. Is it not extraordinary that one of our best performing sectors should be hit by a series of own goals from our own negotiators? Do not take it from me; take it from the noble Lord, Lord Frost, who had the good grace to admit that the last Government had got these touring negotiations wrong, despite Boris Johnson’s promise that what happened would not happen.
I say in welcome to our new Ministers, particularly the noble Lord, Lord Vallance, on the Front Bench, that I understand that you cannot magic up great sums of money. However, there are things that you can do to change the sensibility of our times. Led by a flautist Prime Minister, you can invest in a sense of cultural well-being, cultural curiosity, a determination to allow everyone the chance to learn an instrument, not just the rich, as pointed out by my fellow composer, Errollyn Wallen, last week on “Desert Island Discs” and by Kadiatu Kanneh-Mason, mother of that extraordinary family of musicians, on “Private Passions”. She said that in our present state school system, her gifted children—including the cellist Sheku—would have floundered, as the tutoring they received then no longer exists. Is that not an appalling reflection of where we are and what has gone wrong?
Vast sums are not needed to engineer a rapprochement with the EU, with the Erasmus programme, with the exchange of ideas that are so crucial to artistic creativity. The easing of our relationship with our closest trading partner would mean that musicians, be they pop groups or our world class orchestras, would not be mired in expensive and time-consuming red tape and their transport would not be governed by lunatic cabotage rules which require endless changing of lorries between venues.
In his 1948 polemic, Philosophy of Modern Music, the German philosopher Adorno acknowledged that Schoenberg had forged in that string quartet a new aesthetic
“in the midst of expressionistic chaos”,
but he went on to explain how these innovations were the logical development of Beethoven and Brahms. We too must now get across a divide and go back to a vision of many years ago, to the Arts Minister, Jennie Lee, who wrote:
“In any civilised community the arts … must occupy a central place”.
Lisa Nandy, the Culture Secretary, faces a huge but exciting challenge. I and my colleagues are here to help her and her Front-Bench colleagues in your Lordships’ House in any way that we can. Let us all take a breath of fresh air.
Lord Grantchester (Lab)
How exhilarating it is to speak again from this side of the House. How refreshing that, at long last, the opportunity to deliver on ambition comes our way; to bring stability and certainty back through an industrial strategy that will help economic growth, which is the subject of today’s debate. There is so much in the gracious Speech to celebrate, and I must mention first the football governance Bill, by which sporting opportunities will be enhanced, not least through the growth of the women’s game, which is one of the fastest growing sectors in sport. It is interesting that in the Women’s Super League all the forthcoming season’s clubs will be the same as in the men’s Premier League, reflecting the investment being made by our leading clubs.
The most pressing issue facing us today is climate change. Along with a healthy environment and housing, it is paramount in the programme ahead and can be tackled only through science matched with changing our behaviour. I congratulate my noble friend Lord Vallance on his appointment and maiden speech today. He quoted Karl Popper, who I recall was prominent in the thinking of the philosophy department at the London School of Economics during my university days. In congratulating my noble friends on these Benches on their appointments, I must celebrate the appointment of my noble friend Lord Hunt of Kings Heath, as he introduced in this House what became the Climate Change Act 2008. Equally vital today will be introducing the Great British Energy Bill to set up a new publicly owned company to galvanise clean power projects nationally and bring forward plans to decarbonise electricity by 2030. Urgency is highlighted by the continual warming of the planet that, to my mind, has already passed the threshold of 1.5 degrees above pre-industrial levels, and, with it, increased the importance of adaptation and resilience that fall under Defra’s responsibilities.
I welcome my noble friend Lady Hayman of Ullock to her appointment and urge her to re-examine your Lordships’ report on the future of land use, which was constrained and diminished by Defra in the previous Government. The report has important messages on planning, rural policy and multifunctional aspects of demand for land, none the least of which is demand for infrastructure and housing. My noble friend Lady Young has put forward her credentials for this today, and I will gladly join her in her endeavours.
Stability of policy and certainty for business can be enhanced through devolution of power to the regions, reflecting priorities better initiated by local communities. This can be underpinned only by a clear long-term industrial strategy. In the north-west, the most important aspects of growth are infrastructure and skills, with focus on the region around Merseyside, Manchester and Warrington, not just on the Atlantic Gateway and bringing energy onshore to distribute through necessary national investment in the grid but on skills and training.
Local investment around Crewe was devastated by the sudden cancellation of HS2, reversing vitally needed connectivity. The creation of a mayor for Cheshire and Warrington to co-ordinate with Liverpool and Manchester and reach towards the West Midlands would be a major impetus for igniting economic growth. The focus of a mayor would enhance with solid foundations an area that already has a strong economy. I declare my interest as being asked to help Cheshire business leaders after my experience serving on public and private partnerships, now that LEPs have effectively withdrawn from providing leadership at a subregional level. Cheshire has a population of over 1 million, with a GVA of £31.2 billion in 2020, and it is growing jobs at 3.9% against a rate of 2.9% in England, with a balance of the workforce across all sectors of the economy. The opportunities for growth are extensive. They are also now available from unblocking trade with Europe. They need to be urgently seized.
Lord Horam (Con)
My Lords, I genuinely congratulate the Labour Party on its success at the polls, and I also congratulate our two maiden speakers on their first excellent efforts. My noble friend Lord Petitgas gave the lie to the famous remark by former President Bush that the problem with the French is that they do not have a word for “entrepreneur”.
The stated economic aim of the Government is to be the best-performing economy among the G7 nations and to do that by massively improving the rate of housebuilding. Good luck outperforming America. Leaving that aside, does anyone seriously think that they can hit their target of building 300,000 houses a year and 1.5 million over a five-year Parliament? Last year, we produced 165,000 houses. At the present capacity of the construction industry, it would be difficult to get up to 300,000 a year by the end of five years, never mind to reach that every year.
There is also a big downside to boosting housebuilding to the levels that Labour proposes: it gobbles up ever more of England’s green and pleasant land. Estimates suggest that even building 1 million houses would mean concreting over an area the size of Birmingham. The UK is already the second most heavily populated country in Europe. People do not want this. According to a YouGov poll, 73% of us think that Britain is already overcrowded.
On top of this assault to the countryside and damage to the cordon sanitaire of the green belt, Ed Miliband has already lifted the de facto ban on onshore wind farms and approved three massive solar farms. Many years ago, the poet Philip Larkin penned these lines:
“And that will be England gone,
The shadows, the meadows, the lanes…
There’ll be books; it will linger on
In galleries; but all that remains
For us will be concrete and tyres”.
That is the serious danger of the present Government’s approach.
None of this is necessary. Of course we want young people to have a decent house that they can afford and we want to do our bit for climate change, but it is perfectly possible to do this while at the same time having solid economic growth, and without destroying our precious and limited countryside. For example, the number of households in the UK increased by 3.3 million between 2000 and 2019, but an examination of the census figures shows that in three-quarters of these the head of the household was an immigrant. If we reduced legal immigration to reasonable numbers, the demand for new housing would be significantly reduced. We could also make better use of our existing housing stock and allow local authorities—here I suggest being really radical—to compulsorily purchase land for housing at much lower prices, as Shelter has suggested. The price of land is 50% of the cost of a new house.
As regards solar and onshore wind farms, we certainly need offshore wind and have done very well there, but we could do far more with nuclear power. France, for example, has the cleanest and cheapest power in Europe, because it has spent 50 years investing in nuclear energy. I was very glad to hear Ed Miliband making some helpful remarks in that area.
I appreciate that, after 14 years in opposition, the Government want to move ahead fast and improve our economic growth. I am with them on that, but there are plenty of areas and opportunities for growth that do not impact on the environment: life sciences; fintech; AI, as my noble friend Lord Fairfax of Cameron just remarked; quantum computing; high-end engineering; and the creative industries. These are all areas where we can grow. Above all, we need to make more of the things that other countries want to buy from us. That is the central weakness of our economy, which we need to put right. In my view, that is the right way to go, not bulldozing the countryside for more developer housing and covering our farming land with solar panels.
Lord Truscott (Non-Afl)
I too congratulate the new Ministers and welcome them to the Front Bench, and warmly commend the noble Lords, Lord Vallance and Lord Petitgas, on their excellent maiden speeches.
His Majesty’s Government’s priority mission to stimulate economic growth is laudable. I also welcome strengthening the Office for Budget Responsibility. Never again should a Prime Minister play fast and loose with our economy. A national wealth fund is a good innovation; it is just a pity that this was not created in the 1980s when, unlike Norway, our North Sea oil and gas bonanza was blown on tax cuts for the already wealthy. What do we have to show for it now as a country?
Investment in clean power and our public services after years of neglect will not come cheap. His Majesty’s Government will need to find new revenue streams if we want to invest in new technology, schools and hospitals, and across the regions of the UK, and to fund social care and support an ambitious housebuilding programme.
May I make a suggestion that I have raised a number of times in your Lordships’ House over the last few years? It is surely time to reform inheritance tax, which is paid by less than 4% of the population. To put this in context, if we returned to post-war levels of death duties this could raise £174 billion—enough to fund all our public services properly, including social care, and provide homes for all those who needed them.
A large number of lucky people will benefit from inheritance, but many more people will not, and wealth and property inequalities will only increase. Society will increasingly lack social mobility and move further away from a meritocracy, as opportunities and life chances will depend on whether your parents or grandparents left you a significant legacy or not. Those lucky enough to win the inheritance lottery have just to sit and wait to inherit. Others will not have those advantages. It would be better in my view to transfer a bit more of this inherited wealth to those who need it, and to fund HMG’s ambitious programme through a reform of inheritance tax, rather than make those same people continue to pay the highest level of tax for 70 years.
Many people would prefer to have their estate taxed after they are gone, rather than pay higher taxes during their lifetime. Switching the burden of taxation, even to a limited degree, from income to inherited wealth is one way to achieve this. It avoids the pitfalls of a wealth or property tax, which can hit the living, who are often cash poor but property rich—for example, an elderly couple living in their own home.
I am aware that inheritance tax is one of the most unpopular taxes—particularly, perhaps, in your Lordships’ House—but this is frankly illogical because over 95% of people never pay it. The average inheritance, where there is any at all, is £11,000. Up to £1 million can be currently inherited tax-free from both parents. Nevertheless, there are well-documented alternatives to the current inheritance tax, which is virtually unpaid by the very wealthy. As Paul Johnson, the director of the Institute for Fiscal Studies, said:
“If you have millions it is absurdly easy to avoid”
inheritance tax. The Office of Tax Simplification showed that the average rate of IHT increases from under 5% for estates with a net value of under £1 million; up to 20% for estates valued at £6 million to £7 million; after which it falls to 10% for estates with a value of £10 million or more.
As the Resolution Foundation proposed, inheritance tax could be replaced by a lifetime receipts tax. This would deal with the fallacious argument that IHT is double taxation—we all pay income tax and VAT, for example.
Agricultural property and business asset exemptions, including for AIM shares and gifting, are widely exploited. These exemptions could be restricted to family businesses and farms. IHT could also be made a progressive tax, so the effective rate increases with the size of the fortune, rather than decreasing as now.
The UK’s tax take on inheritance and gifts is less than all but one of the other G7 countries. As Demos reported, if the UK taxed the same proportion as South Korea did in 2022, it would have raised about £14 billion in 2019-20, rather than the £5 billion raised. For the above reasons, I commend inheritance tax reform to the Chancellor of the Exchequer.
Viscount Hanworth (Lab)
My Lords, the incoming Government are right to express dismay at the state of our nation and the economy, and to be cautious about the prospects for achieving the growth that might alleviate some of our problems. Our productive capacity is so attenuated that any economic expansion is bound to encounter obstacles that will limit it.
The expansion of the building industry in pursuit of new housing will create a scarcity of building materials that will lead to sharp price increases. Also, since Brexit, the lack of skilled labour in the industry has worsened.
The expansion of our electricity-generating capacity, via windmills and solar panels, will demand equipment that is not manufactured in the UK. Such an expansion that depends on imports is bound to lead to a problem with our balance of payments.
A recent report commissioned by the Conservative Government extolled the virtues and even the necessity of foreign inwards investment. According to the report, this should provide the funds to sustain investment in industrial infrastructure and alleviate problems with the balance of payments. The report seems to have found favour in some quarters of the Labour Party. I fear that this report has encouraged a common delusion. Inwards foreign investment has rarely been directed at creating and sustaining industrial infrastructure. Instead, it has been aimed at acquiring the ownership of British enterprises. Such foreign investment has been favoured by our financial sector, which derives an income from mediating the sales of our assets. One of its effects has been to increase the demand for the pound in the currency markets, which has enhanced its value. The overvaluation of sterling has made it difficult to sell our manufactured goods abroad; this has been one of the principal reasons for our economic decline.
One way of addressing the problem would be to require our central bank to purchase foreign currencies at times when they are cheap and when the pound is overvalued; this should depress its value. This method of controlling the exchange rate is widely practised by other countries. However, ever since the debacle of Black Wednesday on 16 September 1992, when the UK was forced out of the European exchange rate mechanism, it has been a nostrum of Conservative Governments never to intervene in this way in the currency markets. Such inhibitions should not constrain the present Government.
Seeking to expand our exports should be part of the strategy for industrial recovery. We should also seek to invest in the technologies that will be essential to a green industrial revolution and to provide such technologies to the rest of the world. Advanced nuclear technologies will be a vital element in seeking to decarbonise our energy supply. Here there is a tale of woe to be told. Unless we take steps to support projects to develop new nuclear technologies, we shall have to depend on foreign suppliers.
I will mention three leading UK projects to build fourth-generation nuclear reactors. They are from Moltex Energy, Copenhagen Atomics, and newcleo, and we are in danger of losing all three of them to other countries. Moltex has sold much of its intellectual property to the Canadians, and is now going slow with its UK development through lack of resources. Copenhagen Atomics, which had also been calling itself UK Atomics, is withdrawing its resources from the UK. Newcleo has been constrained to go to France for its nuclear fuel. Our Office for Nuclear Regulation has declined to embark on a generic design assessment of the reactor, declaring that it would be premature to do so, albeit that the equivalent French agency, the Autorité de Sûreté Nucléaire, is doing so with alacrity.
The message is that unless we make immediate declarations of support for these endeavours, we shall have no projects to supply the next generation of nuclear technology, which promises enhanced safety and facilities for disposing of nuclear waste. It looks as if we, who were once the leaders in civil nuclear technology, will have to rely on other nations to provide the technology in the future.
Lord Razzall (LD)
My Lords, this is not the first Government to prioritise growth. In 1964, Harold Wilson put George Brown in charge of a Department of Economic Affairs, to remove what he regarded as the dead weight of the Treasury. George Brown’s plan was to have 25% growth to GDP between 1964 and 1970. It was not really his fault that this did not work; the economic turbulence in the exchange rates blew sterling off course, and we had the subsequent devaluation. Of course, the next overt attempt was by Liz Truss, and it was certainly her fault that there was no growth there. From these Benches—unlike the noble Lord, Lord Callanan—we are delighted that the Government are to legislate to lock in the role of the Office for Budget Responsibility, ignored by Liz Truss with devastating consequences.
Concentration on growth is obviously welcome. Whether the plethora of new quangos will deliver it, who knows? We are promised a growth mission board, a growth delivery unit, a National Planning Policy Framework, an innovation office and a national infrastructure and service transformation authority, let alone the national wealth fund. Good luck.
I will concentrate on three of the proposals that could lead to economic growth. First, there are the proposed planning reforms. Clearly, nothing picks up the pace of growth like a housing boom due to the multiplier effect across the economy. On these Benches we will need to look at the detail of the Bill, but the Lib Dems have always favoured building more houses, provided they are in the right place. Our preference has clearly been for brownfield rather than green belt, but most importantly—actually, vitally—new estates must create a community with GP surgeries, schools and shops, not arid deserts. We await the contents of the Bill.
The second area that has not been touched on in this debate, I think, but in a lot of ways is a no-brainer for growth, is essential defence expenditure. I know that we are looking to go up to 2.5% on defence, and that the Government say they cannot agree the timing until they see the result of their strategic review, but we know now, without seeing that review, that massive replenishment of ammunition is required. All the military services say that we have exhausted our ammunition supplies in the light of what is happening in Ukraine. We cannot wait for the review to replace them. If they are manufactured in the UK, that would provide a kick-start for growth in that area.
Thirdly, noble Lords would not expect me to finish without talking about Brexit, which was negotiated, in our view disastrously, by the noble Lord, Lord Frost. I do not think he is in his place. I am sure he has taken on board the remarks of the noble Lord, Lord Callanan, about civil servants going into politics.
I turn to the potential effect of the creative industries, which a number of my colleagues and other speakers have talked about. The creative industries have huge potential growth and, if we can improve our relationship with the European Union, there will be significant benefits. The obvious one, which the noble Lord, Lord Berkeley, mentioned, is musicians touring and technical support. These are potentially great contributors to growth in our economy, and I hope that the Government can negotiate an improvement in their status. So let us hope that the Government succeed where George Brown failed and where Liz Truss crashed and burned. It is a tricky thing, growth.
Lord Londesborough (CB)
My Lords, this may be my last opportunity to speak in a debate on the King’s Speech, given one Bill coming our way on which I will refrain from comment tonight. I will focus on Labour’s key mission of generating the highest sustained economic growth in the G7, with
“productivity growth in every part of the country”.
I am eagerly awaiting a strategy for productivity that matches that ambitious statement. If you try googling the term “UK productivity”, the next suggested word that pops up is “problem”, followed by “puzzle”. That sums it up rather well. Put bluntly, we have developed some bad habits. We produce too little, consume too much and borrow heavily to finance our deficits, with our national debt fast approaching £3 trillion. That is very bad news for an ageing population with a shrinking workforce. The critical measure, GDP per capita, has barely moved since the financial crisis, while our labour productivity, as we have heard, remains below that of the US, France and Germany and, importantly, has been so for decades.
Stagnant productivity does not just take growth; it blunts our competitive edge overseas—witness the last five years of declining exports. In business, it generally leads to zombie companies, distress takeovers or, worse, bankruptcy. My own experience of productivity stems from 30 years as an entrepreneur in the information space and 10 years advising and investing in start-ups and scale-ups. Indeed, my livelihood depended on the productivity of my staff, both here in the UK and overseas. Over those years I discovered that productivity is not just structural; it is cultural. It is crucial that in the UK we create a performance culture that runs across both public and private sector workforces. This requires leadership, smart management, astute recruitment, and relevant skills and training. Above all, it requires proper incentivisation of our workforce, rewarding performance and developing a stakeholder culture.
The UK has much to learn in this regard from the US and many countries across to Asia-Pacific, all of which are growing considerably faster than we are. I suggest that boosting productivity requires explicit targets rather than lofty mission statements. Why not be bold and set a GDP growth target of 3% per annum for the next five years? To achieve that, we would probably need to improve our worker productivity by 2% every year—not impossible if we set our minds to it and hold ourselves accountable.
I have yet to mention the classic drivers of productivity: higher levels of public and private investment, upgrading infrastructure, education, innovation and technology. All are highly relevant but mainly long-term projects, with a five to 25-year payback that requires huge levels of funding. The problem is that we have an immediate need to mind the productivity gap, and time is not on our side.
Time is not on my side either, so I will conclude by welcoming both Ministers to their new roles and asking them, as I did their predecessors, whether the Government will consider setting up a productivity council on a statutory footing that is permanent and not subject to political churn. This body would inform, co-ordinate, measure and evaluate policies that impact on private and public sector productivity across all departments. Its members, critically, would have had first-hand experience not only of what drives productivity but of what it takes to stick to targeted long-term measures.
Lord Hendy (Lab)
My Lords, I too add my congratulations to my new noble friends on their appointments to the Front Bench, and the noble Lord, Lord Vallance, on his speech. I celebrate the new Government’s commitment to the new deal for working people. I declare my interests in the register and as legal adviser to the task force that drafted the new deal.
Without doubt, the proposals to enhance individual rights and make the repeals identified in the new deal are most welcome. A secure, well-paid workforce with decent rights is not just beneficial for workers. The recent Institute of Directors survey shows that the new deal proposals enjoy considerable support among employers, and the recent TUC survey shows how enthusiastic the public are.
Yet more is needed to address a fundamental problem: the overwhelming majority of our 31 million working people have no control over—indeed, no input into —the determination of the terms and conditions on which they work. We need changes to the law to allow workers to exercise collective leverage through their trade unions to balance the economic power of employers. Labour’s plan will certainly help in this respect, allowing unions to have reasonable access to workplaces and reforming the statutory recognition procedure.
But a key proposal of the new deal has lost some prominence. The new deal proposed collective bargaining machinery for each sector of the economy. Instead, Labour intends such bargaining for the social care sector and for school support staff, with a commitment subsequently to
“assess how and to what extent”
sectoral bargaining arrangements
“could benefit other sectors and tackle labour market challenges”.
Yet the case for extensive collective bargaining is firmly established internationally. The OECD and the ILO have been pressing its case for years, and even the IMF has pointed out its advantages. The EU introduced a directive last year requiring every state with less than 80% of its workforce covered by a collective agreement to produce an action plan to achieve it.
In the UK, compulsory sectoral bargaining was introduced in 1909 and voluntary sectoral bargaining promoted from 1917 onwards, encouraged in the 1930s, as my noble friend Lord Monks pointed out. By 1945, and through to 1980, collective bargaining coverage in the United Kingdom exceeded 80% of the workforce, but anti-union legislation and government policy have collapsed coverage to fewer than one in four of our workforce. The rest have their terms dictated by their employer unilaterally. The result has been catastrophic for workers. The Government acknowledge the growth of job insecurity. Median real wages have not risen in value since 2007. Half our workforce earns less than £550 per week, and 38% of those on universal credit—2.3 million people—are in work.
Research shows that sectoral agreements would increase wages, eliminate pay gaps, diminish inequality, regularise hours, enhance productivity and stop labour cost undercutting. Such agreements would improve the conditions of life for millions and increase demand for goods and services, which would be instrumental in growing the economy. They would slash the Government’s expenditure on benefits and increase their tax take. Above all, they would allow workers again to have a say in setting the terms and conditions of their working lives.
Sectoral collective bargaining therefore cannot stop at social care and school support staff. The need for sectoral bargaining across school teaching, food production and agriculture, warehousing, parcel and food delivery, hospitality, retail and many other sectors is as acute. I hope my noble friend the Minister will be able to assure the House that fair pay agreements will be rolled out across the economy.
Lord Elliott of Mickle Fell (Con)
My Lords, I add my congratulations to the noble Lords, Lord Vallance of Balham and Lord Livermore, on their new positions in His Majesty’s Government. I wish them both well in their duties. I also congratulate my noble friend Lord Petitgas on a superb maiden speech, which was both amusing and intellectually powerful. In this debate on the gracious Speech, I shall talk about employment, an issue that I champion as president of the Jobs Foundation, as declared in the register of interests.
When the Government published their manifesto, a good deal of attention was rightly given to their commitment to economic growth and wealth creation, two priorities that I heartily support. But their manifesto also included a less publicised but equally welcome pledge to increase the employment rate in the UK from 75% to 80%, bringing 2 million more people into the workforce. This is an important priority for both our economy and our society. Post pandemic we have seen a sharp rise in economic inactivity, with the Institute for Employment Studies finding that there are nearly 1 million fewer people in the workforce than pre Covid. I must give enormous credit to the journalist Fraser Nelson for highlighting that issue before many others.
While that pledge was, understandably, not referred to specifically in the gracious Speech, I hope it is not lost as a policy objective in this Parliament. I would be grateful if the Minister could confirm whether the employment rate pledge is still a commitment for this Parliament. I certainly hope it is, as increasing employment is an essential ingredient in securing economic growth and making full use of our talents as a country.
At the same time, we should all recognise that achieving that worthy objective is not solely down to the Government. As a noble Lords will know, it is businesses and entrepreneurs that provide 80% of the jobs in our economy. To achieve this objective, we need not only a pool of skilled and motivated prospective employees; there also need to be employers creating high-quality, well-paid jobs for people to fill.
The Jobs Foundation has spent the past year interviewing hundreds of local business leaders, employees and other local stakeholders to get a better understanding of the vital role businesses play in helping people escape poverty, unemployment and other forms of disadvantage by providing jobs. In Sheffield, for example, the Jobs Foundation looked at the Ascend programme led by Ben Woollard, which aims to end young adult unemployment. By working closely with employers and fostering supportive peer groups, it is able to integrate unemployed young adults into the workforce and equip them with the essential experience they need to thrive and succeed. Similar work is done, famously, with ex-offenders by Timpson, and I am delighted that the noble Lord, Lord Timpson, has been appointed Prisons Minister. I congratulate him on his introduction to the House today.
Getting an extra 2 million people into work is not simply a statistic or a slogan. These jobs will come from individual business leaders making specific decisions to employ an extra person or take on an additional apprentice. So, at a macro level, the right business environment is needed to ensure that these 2 million jobs are provided. As Ministers flesh out the details of the employment rights Bill and the Skills England Bill, I hope they pay careful attention to the feedback from the business community. As they decide the measures to include in the Budget, I urge them to have in their mind’s eye the business leader weighing up whether to take on that extra employee and the entrepreneur calculating whether to invest.
I am reminded of the famous Aesop’s fable, “The Goose that Laid the Golden Eggs”, which I recently read to my daughters for their bedtime story. As noble Lords will recall, in this story, the impatient and greedy countryman had the idea of getting all the golden eggs at once by killing the goose and cutting it open. But, when the deed was done, not a single golden egg did he find, and his precious goose was dead. The business community is our country’s golden goose. So, as we get behind the mission to get 2 million more people into work, let us not forget the essential role played by business leaders and entrepreneurs to make this happen.
Lord Davies of Brixton (Lab)
I congratulate the noble Lord, Lord Petitgas, on his compelling maiden speech, and I congratulate my noble friend Lord Vallance on his. I welcome him to the House—it is good to have a fellow south London suburb represented. I also welcome the two Ministers to the Front Bench. I look forward to some constructive engagement in the implementation of Labour’s policies as set out in the King’s Speech.
I will pick up on the issues of mental health and pensions. First, we will have the long-overdue mental health Bill. The report on which it is based was written in 2017. I declare an interest in this context: my involvement with the Money and Mental Health Policy Institute, as set out in the register. This is the key issue. The two issues of financial well-being and mental health are inextricably linked. An earlier speaker referred to the productivity puzzle, and it is clear that good mental health improves productivity: it enables people to get to work and to be more effective when they are at work.
On reading the detailed notes on the mental health Bill, I was a little concerned that they say that, although the legislation will be passed, its measures will be implemented only when resources allow. That obviously must be true, but it is important to understand that creating and improving mental health has a massive effect on productivity in the economy as a whole. Academic research has shown that it is self-funding: improve people’s mental health and the economy will produce the growth that our policies place so much reliance on. I totally agree with my noble friend Lord Layard’s comments on a similar point.
Then there is the promised pension schemes Bill. It is important to distinguish that we have a Bill coming shortly with some immediate measures to make the existing system work more effectively. I particularly welcome the proposal that the prime objective of these schemes should be to provide a pension and not be savings arrangements, and part of the Bill is going to require schemes to see that as their major role. I support most of the measures set out for the Bill but, as my noble friend Lord Chandos said earlier, the devil is in the detail, and we will have to look at them closely to see that they are producing the required objectives.
Following the pensions Bill is the pensions review, the first phase of which starts with a look at creating investment. This whole debate so far has been seen as being about a supply issue, supplying the funds that our economy needs to create the wealth. I think that it is also a use problem; we need to make sure that that money, if it is made available, is used effectively. The British economy has a long-running problem with using investment funds effectively, and I hope that the Government will take on board that issue.
The other concern that I have is that various people from the industry are quoted in the detailed notes produced in conjunction with the proposal for the first stage of the pensions review but there are no quotes from the users, from the people who require or receive pensions. I hope that my noble friend will be able to assure me that, in carrying out the first phase of the review, trade unions and bodies representing pensioners will be involved in that work.
Lord Freyberg (CB)
My Lords, it is a pleasure to welcome the two Ministers, the noble Lords, Lord Vallance and Lord Livermore, to their new roles. I congratulate the noble Lords, Lord Vallance and Lord Petitgas, on their excellent maiden speeches.
At this late hour, I shall focus on the Government’s economic growth plans, with particular emphasis on science, technology and innovation. I warmly welcome the appointment of the noble Lord, Lord Vallance, a recognised scientific expert, as Minister for Science, Research and Innovation. Elevating experts to harness new and emerging technologies for national security, energy independence and economic growth is an encouraging move, as were the new Minister’s remarks on the subject to the G7 Science and Technology Ministers’ meeting in Bologna earlier this month.
I have often spoken in this House about the potential for data to transform the UK’s research and innovation landscape, especially with regard to the value of the nation’s health data. Therefore, I was heartened by the Minister’s support for an NHS data trust and eagerly anticipate concrete measures in this area. I would, however, like to understand how the Minister plans to ensure that the economic benefits of a single front door, facilitating industry access to health data, will extend beyond the UK’s “golden triangle” of Cambridge, Oxford and London to other regions known for pioneering in this space and which could, in some important respects, be said to generate a disproportionate volume of the health data that industry might wish to utilise.
Over recent years, much has been said about trust in relation to responsible data access and use. Similarly, we often hear about traditional infrastructure developments aimed at boosting growth nationwide. However, little has been said about how the Government plan to ensure that all regions share in the benefits of data-driven growth. I wonder whether the Minister could comment on that in his reply.
I also welcome proposals to introduce longer-term funding settlements for research tied to key pillars of the Government’s industrial strategy, including the life sciences. Private investment in life sciences R&D contributes £5 billion annually, accounting for approximately 50% of total investment, so measures encouraging confidence and stability post-Brexit are crucial to help steady the ship of state. Any measures designed to ensure that public investment benefits regions beyond “the usual suspects”, such as the Government’s renewed emphasis on devolution, are, once again, to be encouraged.
The new Minister’s pro-innovation approach to regulation seeks to balance known knowns with unknown knowns, a hallmark of scientific exploration, particularly regarding artificial intelligence. His intentions are clearly reflected in the Government’s proposals to consolidate relevant regulators. I look forward to engaging with these detailed proposals as they emerge. However, like the noble Lord, Lord Clement-Jones, the noble Baronesses, Lady Bonham-Carter and Lady Stowell, and others, I seek confirmation of how the Government intend to protect the rights of our creative industries, which significantly contribute to the UK’s GDP. Concerns persist about generative AI companies using creative works without consent or remuneration. Overly restrictive copyright laws can hinder innovation, while too lenient laws can fail to provide adequate incentives for creation. Effective copyright policy should aim to strike a balance that protects creators’ rights while fostering an environment conducive to innovation. I hope the Minister will look to find a middle ground on this.
Additionally, I am interested in how traditional economic growth policies, such as freeports, could be augmented to boost digital exports through innovative incentives.
Finally, I wholeheartedly support the consolidation of the Government’s digital functions under the Department for Science, Innovation and Technology, DSIT, to unify efforts in the digital transformation of public services. The proposal to establish a national data library is particularly intriguing, given the extensive data currently collected and curated by local government and integrated care systems. Significant investment in data standardisation, collection and analysis is urgently needed to transform the productivity of social care, our least digitised and, in many respects, most left-behind sector. It is crucial that the terms of reference for any relevant reviews and commissions explicitly address the role of digital transformation in the future of care, including workforce development plans.
Baroness Thornton (Lab)
My Lords, first, I welcome my new noble friend Lord Vallance to his place and congratulate him on his brilliant maiden speech. I also welcome my noble friend Lord Livermore to his job. I just say to my noble friend Lord Vallance how important his work during the pandemic was to this then Labour health spokesperson trying to hold the then Government to account.
As the last Back-Bench speaker in this debate on the gracious Speech, I know that it is often the case that everything has been said at least three times before and is going to be said again. It is possible, however, that my contribution, which concerns the place of co-operative enterprise, social enterprise, mutual enterprise, civil society in general and impact economy solutions in the task we have set ourselves of national renewal and fulfilling the missions on which our election was fought, might not have been said yet.
I am a Labour and Co-operative Member of your Lordships’ House; I am the founding chair of Social Enterprise UK and now its patron; I founded the social enterprise all-party group in 2001; and I am chair of the co-operative innovation trust and an associate director of E3M, which brings together the leaders of social businesses who contract to provide public services. The social enterprise sector has 131,000 social businesses, employs 2.3 million people and has a turnover of over £78 billion.
I welcomed with joy that, with the Labour Party, the Co-operative Party shares a manifesto commitment to double the size of the co-operative and financial and mutual sector, which includes, in my view, social enterprises and community business. It is a vital ambition to securing economic growth and ensuring that the benefits of co-operatives and social enterprises can be felt more widely across the economy.
I have a series of questions for my noble friend the Minister but, as I am the last speaker, I do not expect specific answers right now. However, it is important for the stakeholders that we have answers to these questions. The first is about the machinery of government, which concerns how we can deliver this. At present, the responsibility for social enterprise sits in the DCMS, alongside civil society—a result of the vagaries of the last Government’s neglect and lack of interest. If there is to be a drive to promote SMEs and businesses of all kinds, surely businesses which are established for a social purpose and those which are contracting to deliver public services—some very substantial ones indeed—need to be the responsibility of the Department for Business and Trade. Is that possible?
Indeed, the whole of civil society, much of which is delivering services and supporting communities, is part of the DCMS. To maximise its essential contribution to our national renewal, surely responsibility for it needs to be across government. Which Minister will be responsible, and how will the Government ensure cross-governmental delivery, given that no department or officials have responsibility for this at the moment?
Linked to the place of civil society is the potential of impact investing. As we face constrained public spending and pressing social challenges, we must look to innovative solutions. The impact economy—a coalition of philanthropists, impact investors and purpose-driven businesses—offers a way forward; it has the potential to contribute billions to our economy.
The Community Match Challenge, launched during the Covid years, successfully matched £85 million in government grants with funds from philanthropists and foundations, and supported charities and community organisations across the country. By providing crucial finding to community development finance institutions, the community investment enterprise fund is fostering economic growth and job creation where it is most needed. How can these initiatives, which are about boosting growth, be scaled up? Are we thinking of setting up an office for impact investment or a strategy?
Finally, the Start-Up, Scale-Up report addresses a plan for high growth and the issue of making public procurement work for start-ups and small businesses. It recommends that we create a procurement council of experts to review best practice and identify areas of improvement, and to review the barriers to better pre-market engagement. This is a very relevant matter to mutual social enterprises and the co-operative provision of public services. How will this link to the support of a proposed social values council? I am happy to say that a letter in the Library will suffice.
Baroness Kramer (LD)
My Lords, I join the welcome to the noble Lord, Lord Vallance. He has earned the trust of the British people and, frankly, there are not many of us in this House or the other place who could make that claim. We welcome him and his excellent speech. I also congratulate the noble Lord, Lord Livermore. In economic debates, we have become so used to the noble Lord and the excellent noble Baroness, Lady Vere, being our two final speakers, but it will no longer be in the same order. I welcome him to his ministerial post.
To the noble Lord, Lord Petitgas, I say that he should not worry about having French origins; we are multicultural here. There are many of us who can show him ways to avoid the Royal Gallery and the paintings of Waterloo and Trafalgar—we would be glad to do it.
This has been an extraordinary debate. In using the term “consensus”, the noble Viscount, Lord Goschen, expressed a lot of the common ideas that were being shared across the House. The noble Lord, Lord Berkeley, talked about “fresh air” and managed to exactly capture the feeling I have had that there is a sense that, no matter which Bench noble Lords are sitting on, we are moving into a new time—a much more positive time, I hope.
As the first of the winders, I begin by saying that I wish the new Government well, but we face very challenging times, and the noble Lord, Lord Birt, basically took us through the situation that we face. The King’s Speech outlined a series of actions, and I very much hope that these will shift us back on to the front foot in growth. But the questions will arise: what is the detail, and will these measures be sufficient?
My colleagues on these Benches have outlined a series of steps that we think are critical; let me emphasise just a couple of them. The noble Lord, Lord Fox, talked very firmly about the need for an industrial strategy that provides long-term certainty, and that was shared by noble Lords from across this House. The noble Viscount, Lord Stansgate, and the noble Lords, Lord McNicol, Lord Mair and Lord Gadhia, expressed similar points around the importance of a long-term and certain industrial strategy.
The AI revolution needs a strategy, but we also need to recognise its extraordinary complexity. That will not be an easy process. We heard about that from the noble Lords, Lord Clement-Jones, Lord Holmes and Lord Fairfax, the noble Baroness, Lady Kidron, and the noble Viscount, Lord Colville—and I have probably missed a couple of names along the way. We heard about the significance of infrastructure from the noble Lords, Lord Liddle and Lord Fox, but also very specifically on the transport agenda from the noble Lords, Lord McLoughlin, Lord Bradshaw and Lord Berkeley, and the noble Baroness, Lady Randerson. That is all essential to our discussion.
I join with the noble Lord, Lord Palmer, and the noble Baroness, Lady Benjamin, in stressing the importance of ending the two-child benefit cap. It is often seen just as poverty alleviation and as such perhaps not significant in a growth debate, but with that kind of pressure on families, the chance of getting them to turn and focus on the future with hope and energy is very low. We empower people when we allow them to be in the appropriate economic setting, and the deprivation of children is not consistent with that.
We have to rebuild our workforce—many have said that—to end the crisis and the long-term waiting list in the NHS. That also requires fixing the care system. On that I join very much with the noble Lord, Lord Forsyth; I am so glad that we have found something in common in this Speech. My greatest disappointment with the King’s Speech was the lack of focus on social care, and others raised this issue in the course of their various speeches.
We also know that for the workforce we have to reform our apprenticeship schemes to give people of all ages real opportunity. Even with those steps, I agree with the noble Lord, Lord Fox, that our clear shortage of workforce and our high dependency ratio mean that, at least for the immediate future, we will need skills from abroad. That means a proper sector-based migration strategy.
We all share the aims of growth and prosperity, but there is a choice: do we do this from the top down, or build from the roots up? My party argues very strongly that community should be engaged in leading development. I loved the words used by the noble Lord, Lord Heseltine, “locally designed”; the words of the noble Lord, Lord Best, focusing—again— very much on community and engagement; and those of my colleagues. In places such as Eastleigh and the London Borough of Kingston, community-led development, including social and genuinely affordable housing, has gone at great pace with strong local support. By contrast, where projects are developer-led, the plans submitted are so often quite frankly abusive. It is no wonder that projects end up in disputes for years; we need locally led development to build not just housing but our commercial services and manufacturing backbone. Community engagement is key.
Small businesses are the backbone of our economy and have a long list of needs, including prompt payment. I am mortified that for so many, access to finance remains utterly inadequate. The noble Lord, Lord Sarfraz, addressed this with the AIM market, which has been in decline, but I want to go to something even more basic. Challenger banks, fintechs and alternative lenders, even allied with open banking, have not solved the problem of loan funding for small businesses. We have an absolute valley of death in this area.
Why are we not aggressively building a layer of community development finance institutions across the UK? This is the mechanism that built up small business in the United States and provided resilience through two major recessions and other crises. The CDFI sector in the US has $452 billion in assets and is absolutely key to the US economy’s resilience. We need a community reinvestment Act here, like the one that created that sector in the US. Will the Government bring it forward?
Let me pick up some of the words on small businesses and exports. I think our small businesses are desperate to reclaim a place in the European supply chain. The number that have dropped out of exporting altogether post Brexit and because of the deal that was framed is shocking. We will press the Government to negotiate away red tape and to create the potential for us to rejoin the single market, even if not in this parliamentary term. At the very least, will the Government respond to the needs of the creative industries and enable proper travel and functioning for the creative industries across Europe?
Lastly, on small businesses, I want to address the issue of business rates. No one has mentioned it, but few steps would more rapidly drive the revival of town centres and communities across the country than scrapping the current structure of business rates and replacing them with a much fairer levy on commercial property owners: a form of land value tax.
I am close to the end of my speech because I am out of time, but we on these Benches are not out of ideas. Your Lordships heard the noble Baroness, Lady Bowles, talking about procurement, which is critical, and the noble Lord, Lord Lee, on the stock market and investing in financial education. The noble Baroness, Lady Bonham-Carter, and the noble Lord, Lord Berkeley, talked about the same issue, as did others, on the significance of the creative industries, and the noble Lords, Lord Morse and Lord Davies of Brixton, the noble Viscount, Lord Chandos, and the noble Baroness, Lady Drake, addressed the whole area of pensions and providing finance into that investment in the future.
However, I want to put down one marker on that issue: the protection of people with small pots of investment. Putting their money into illiquid, high-risk investment without any guarantees and protection leaves them very exposed. Therefore, be careful as you structure this change in the way in which pension investment is made, and remember that there is a responsibility—I think I am echoing the noble Lord, Lord Davies, here—to the people whose pensions these are: to the actual savers and users.
There is so much more to say, but I am coming to the end of my time. I thank your Lordships for the opportunity to wind. I hope that this will be an exciting portfolio and that we will all meet again very often to discuss these issues.
Baroness Vere of Norbiton (Con)
My Lords, as the penultimate speaker, I am well aware that I am all that stands between your Lordships’ House and the person noble Lords really want to hear from: the new Minister, the noble Lord, Lord Livermore. I add my welcome to those of so many others as I pass the torch, and I wish him the very best of luck for the future.
I also welcome the noble Lord, Lord Vallance, and like many will watch with interest his transition to the political side of government. It ain’t easy. But he brings great expertise and experience, and I am sure he will make the transition with aplomb. Last, but certainly not least, I welcome the wise words from my noble friend Lord Petitgas. He brings a deep understanding of the private sector to your Lordships’ House and experience of working at the very highest levels of government. We are enormously fortunate to have him on the Opposition Benches.
Labour put economic growth at the heart of its election campaign as a means of funding many of its promises, alongside a siren call for change. The sheer weight of legislation signalled in the gracious Speech certainly signals significant changes to come. But all change, good or bad, creates disruption and adds friction, and disruption and friction will inevitably be a drag on economic growth.
Change needs to be done carefully, following consultation, and preferably signalled far in advance. So I will be looking carefully at two things: have the new Government consulted stakeholders sufficiently before tabling primary or secondary legislation in your Lordships’ House, and have they considered the impact of proposed changes on economic growth and signalled any trade-offs publicly?
In addition, the last Conservative Government prioritised economic growth too; it is nothing new. Despite the UK economy being battered by a global pandemic and sideswiped by Putin-boosted energy costs, our actions created an environment in which the economy could recover, and recover it has, much faster than almost all main forecasters predicted.
The previous Government prioritised reducing the tax burden on businesses and working people, reforming the welfare system, increasing the productivity of the state, which has still not recovered to pre-pandemic levels—we must do better—and removing excessive regulation. Looking at Labour’s plans, there are hints of a different future for the UK economy: a more interventionist and managerial approach from government, which will inevitably lead to greater regulation and far more regulatory bodies, with the real possibility of “too much, too quickly”. This approach runs the risk of stifling innovation and raising the costs of doing business, particularly for those agile, high-growth businesses that this country is so good at nurturing.
The new Government’s response may be that they are forced to regulate as they are unable to support the change they want with more investment. To back this up, the new Labour Government have spent the weekend out on the airwaves telling us that there is little public money for investment, that the economy is dire, and that the public finances are apparently way worse than they were expecting.
Let us pause very briefly on public spending. The main estimates, which will come before the Commons later this week, seek to approve over £1,000 billion of government spending for this financial year. This is the inheritance the new Government will have custody over—£1,000 billion a year. It is now their choice how they do their priorities. Will they stop spending where it is no longer value for money? Will they identify efficiencies to improve productivity? It is not the case that any spending must always be additive. Sometimes it is okay to look back at the £1,000 billion we already spent every single year.
On the public finances, according to the director of the independent Institute for Fiscal Studies the books are “wide open” and “fully transparent”. Furthermore, Labour has had access to government departments since well before the election, so it is simply not credible or desirable for a new Government to say, “Things are much worse than we thought” and then seek to renege on promises made to the British people.
I have been slightly sidetracked, because I will briefly go back to the gracious Speech. What is it therein that will encourage economic growth? Much has been made of the new deal for working people, the brainchild of the Deputy Prime Minister—but, slightly confusingly, recently co-opted or adopted by the new Chancellor, and now we understand it has been taken up by the Business Secretary. Can the Minister confirm which department is leading on the legislation? The Trades Union Congress has high expectations for this Bill, calling it the
“biggest upgrade to workers’ rights in a generation”.
For my part, I am not sure quite what to expect, but I have not had the ear of the new Labour Government. However, it was helpful for the noble Lord, Lord Woodley, to add a few upgrades that I had not heard of before, so I am looking forward to more detail about this. Perhaps the Minister could provide some when he winds up.
Whatever the final text of the new deal looks like, I hope that the Government will have completed extensive consultation with businesses and their representatives, the third sector and non-unionised workers—alongside the trade unions, of course. I understand that the Government have committed to introducing the new deal legislation within 100 days of being in office. That is by 13 October. That does not leave much time to consult, consider carefully the responses, and adjust the legal text and associated documents accordingly. Then again, I also hear that the Labour Government are committed to delivering the new deal “in full”, so perhaps the consultation bit will be put to one side. Can the Minister shed any light?
It is possible that these proposals will serve primarily to make businesses, the public sector and the third sector more cautious about who they hire and when, causing downward pressure on employment. Does the Minister agree that it is important that the Government recognise publicly the trade-offs and the consequent drag to economic growth and public sector productivity?
So my quest for a silver bullet for economic growth in gracious Speech continues; I have not found it here. Perhaps a better catalyst for economic growth might be the industrial strategy council trailed in the gracious Speech. I read with interest the “mission-orientated industrial strategy” published in September last year: clean power by 2030, data for public good, caring for the future, and building a more resilient economy. Many of these are intangible and hard to grasp. As my children would say to me, “Mum, these are just vibes”.
What is striking is that there is nothing about economic growth in these missions. Reading the fine print, we are told that growth will result from a “spillover” of innovation from meeting these vibey missions. This is probably not enough to get the OBR, or anyone else, to upgrade their growth forecasts. So can the Minister tell me a bit more about this council? I understand that there will be a group of full-time experts on the council. Have these people been identified, and will they work full time on government pay scales?
The primary remit of the council will be to assess the effectiveness of the Government’s industrial strategy and policy implementation. When will the Government publish an industrial strategy and the detailed policy framework for the council’s scrutiny, or will the council first work on the vibes created by the missions? Given the above, I am not wholly convinced that the council will have much of an impact on economic growth in the short to medium term, so my search continues.
A national wealth fund? That sounds like something that will generate economic growth, except that it seems to be little more than a rebrand of existing government structures. Many noble Lords have talked about what will happen to the UK Investment Bank, and I am not entirely sure about the future of the British Business Bank, but we do know that the Chancellor has suddenly found £7.3 billion to invest in this, despite public finances being unexpectedly poor. She did this without a spending review, without a Budget and with no expert external validation from the OBR—go figure.
But enough of this doomsterism; let us do some boosterism. There are two areas where we can absolutely work together. The first is AI. If wisely implemented, it can offer huge gains in both the private and public sectors. We will watch with great interest and support where we can. We want to retain and build on our global leadership in AI, we want to make sure that we build AI safely and, of course, we want to ensure that it is deployed in a trustworthy fashion. The second area is universities. There is a huge amount that we can do to encourage spinouts from universities.
To conclude, the contents of the gracious Speech expose the disconnect in the Government’s thinking, but there are bits of light that we can certainly take forward. To her credit, the new Chancellor did say that she did not expect to turn things around straight away. In the meantime, I am pleased that the last Conservative Government took a number of key decisions that will boost growth, and I expect us to get full credit for that growth, for a little while at least.
The Financial Secretary to the Treasury (Lord Livermore) (Lab)
My Lords, I thank His Majesty for his gracious Speech and all noble Lords for their contributions today. It is the greatest honour and privilege to be closing the debate this evening. Growing up where I did, I was the only pupil in my school year to go to university and I never once imagined that I would be standing at this Dispatch Box in your Lordships’ House. I will never forget that, above all else, politics should be driven by a sense of service to our country, and I will always seek to work collaboratively with all noble Lords, aware at all times of how much there is to learn from the collective wisdom of this House.
I am grateful to all noble Lords for their warm words, and I thank them for their continued guidance and friendship. I pay tribute to the noble Baroness, Lady Vere, whom I have shadowed for the past year. We may rarely have agreed, but I always greatly admired her command of her brief and greatly enjoyed working with her. I am pleased that she is on the Front Bench this evening and that her expertise is still available to your Lordships’ House.
The noble Baroness will know what a huge privilege it is to work in the Treasury, a truly formidable institution. I am delighted to have returned there, some 17 years after I left. I am particularly proud to have returned under the leadership of the first-ever female Chancellor of the Exchequer, who after 800 years has broken one of the remaining glass ceilings in government. It is long overdue.
I join other noble Lords in welcoming the noble Lord, Lord Petitgas, to your Lordships’ House and congratulate him on his maiden speech. His business and investment experience will be particularly relevant to the new Government’s growth agenda, and I look forward to his contributions in many subsequent debates.
It is also an enormous privilege to welcome my noble friend Lord Vallance of Balham to your Lordships’ House and to have had the good fortune to be present on the Front Bench for his maiden speech today. There is no doubt that my noble friend’s detailed knowledge and strategic guidance was pivotal during the Covid pandemic, saving countless lives as a result. He brings a wealth of experience and expertise to this Chamber. I know that he is very grateful for all the kind words that have been expressed to him during today’s debate.
Our manifesto made it clear that sustained economic growth is the only route to improving the prosperity of our country, raising living standards and sustainably funding public services. That is why it is our central economic mission.
As my noble friend Lord Liddle observed, several noble Lords spoke in positive terms about the economic inheritance that this Government face, including the noble Lords, Lord Callanan and Lord Bridges of Headley, and the noble Baronesses, Lady Noakes and Lady Vere. On her first day in the Treasury, the Chancellor received new economic analysis from Treasury officials on the lost growth of the past 14 years. This analysis shows that, had the UK economy grown at the average rate of other OECD economies, it would now be over £140 billion larger. This could have brought in an additional £58 billion in tax revenues in the last year alone—money that could have revitalised our schools, hospitals and other public services.
Instead, as my noble friend Lord Wood of Anfield pointed out, public services have been pushed to breaking point. There is sewage in our rivers and our schools are crumbling. The national debt has more than doubled. Taxes are at a 70-year high, and, according to the OBR’s March forecast, this will be the first Parliament on record where living standards were lower at the end than at the beginning.
It is true to say that many of the crises which we faced during this time were global in origin, but other countries faced those same shocks. The reason we in the UK were hit harder than comparative countries can be explained only by the choices made here at home: austerity which choked off investment, a rushed and ill-conceived Brexit deal and the disastrous mini-Budget, which crashed the economy.
The general election was an opportunity for the British people finally to pass judgment on the economic record of the past 14 years, and they voted overwhelmingly for change. We have begun the work necessary to deliver on that mandate—to fix the foundations of the economy, rebuild Britain and make every part of our country better off.
Our approach to growth rests on three pillars: stability, investment and reform. I turn first to stability, which must begin with respect for our economic institutions. For much of our history the strength of our economic institutions has bestowed credibility in international markets and underpinned our economic success. Politicians who seek to undermine those strengths, as we saw in the last Parliament, play a dangerous game. Under this Government, the Bank of England’s Monetary Policy Committee will continue to have operational independence in the pursuit of its primary objective of price stability, with a 2% inflation target.
Some noble Lords, including the noble Lord, Lord Forsyth, and the noble Baroness, Lady Noakes, criticised the Government’s plans for the Office for Budget Responsibility. The OBR has been praised by the OECD as a
“model independent fiscal institution”.
We will strengthen it for a very real reason, so that there can never again be a repeat of the disastrous mini-Budget which crashed the economy and increased average mortgage payments by some £300 a month. The new Budget responsibility Bill will deliver on the promised fiscal lock. This will ensure that every fiscal event making significant changes to taxation or spending will be subject to an independent assessment by the OBR.
In answer to my noble friend Lord Eatwell on how the fiscal rules will treat various spending scenarios, if he does not mind I will write to him to ensure that I address his questions correctly.
The noble Lord, Lord O’Neill of Gatley, proposed a revised fiscal rule. I agree with him that we cannot continue with the short-termist approach that disregards the importance of public investment, but neither can we ignore the pressing need to rebuild the UK’s public finances. We must maintain an iron grip on the public finances; if we do not, as we saw in the last Parliament, it is families that are forced to pick up the bill. The manifesto commitments that this Government were elected on must be kept to. They include robust fiscal rules, and we will keep to our commitments on tax, with no increase in national insurance or in the basic, higher or additional rates of income tax or VAT. Corporation tax will be capped at its current rate for the duration of the Parliament. If our international competitiveness is threatened, we will act.
On spending, the Chancellor has instructed Treasury officials to provide an assessment of the state of the spending inheritance, and she will present this to Parliament before the Summer Recess. My noble friend Lord Layard asked about the Green Book being used in the spending review, and the answer to that is yes.
The noble Baroness, Lady Bowles, raised the question of investment trusts. The investment trust sector plays a significant role in the UK economy, making up over 30% of the FTSE 250, including infrastructure projects and renewables that can help support the Government’s growth agenda. I continue to believe that the noble Baroness makes a persuasive case for action, and the Government will carefully consider all options available to address the issues she raises. I will be happy to meet her to discuss her Private Member’s Bill in further detail. I am grateful to my noble friend Lady Thornton for saying I can write to her, which I will.
In answer to the suggestion from the noble Lord, Lord Lee of Trafford, regarding NatWest shares, I am afraid I cannot comment on the approach to specific sales of the shareholding, which is commercially and market sensitive. I am grateful for the support of my noble friends Lady Drake, Lord Wood of Anfield and Lord Drayson for their support for the pensions Bill launched by the Chancellor, which was also discussed by the noble Lord, Lord Morse. In addition, the pension schemes Bill will support more than 15 million people who save in private sector pension schemes get better outcomes from their pension assets and support the Government’s mission to deliver growth.
I now turn to how we will unlock private investment in the infrastructure that our economy desperately needs. Britain today is the only G7 country with investment below 20% of GDP, which holds back productivity, as observed by the noble Lords, Lord Bridges of Headley and Lord Birt, and hinders us in the competition for the industries of the future. I agree with the noble Lord, Lord Sherbourne of Didsbury, that it is not in the Government’s gift alone to reinvigorate these faltering levels of investment; the lifeblood of economic growth is business investment. The right reverend Prelate the Bishop of Newcastle spoke of partnership, and I agree with her. A strategic state does have a crucial role to play in partnership with the private sector. That partnership will be embodied, as my noble friends Lord McNicol of West Kilbride and Lord Chandos said, in a modern industrial strategy and a new national wealth fund. A modern industrial strategy—which, to reassure the noble Baroness, Lady Bonham-Carter, and the noble Lord, Lord Berkeley of Knighton, will include the creative industries—enables us to work with businesses to identify those areas where Britain enjoys, or has the potential to develop, comparative advantage, but where there are currently market failures or other barriers that hold back investment.
The noble Lord, Lord Mair, spoke in favour of an industrial strategy council, which we will establish to ensure that industrial strategy policy is informed by a broad and high-quality evidence base and a diverse range of perspectives. To respond in part to the question from the noble Lord, Lord Kakkar, last week the Health Secretary committed to supporting the Government’s growth mission by making the UK a life sciences and medical tech powerhouse. To respond to the noble Lord, Lord Wigley, the Government are committed to securing a competitive and sustainable future for the UK steel industry, and will remain in talks with Tata Steel.
The Chancellor has already held a meeting of the national wealth fund task force to establish the fund, and the national wealth fund Bill will put it on a permanent statutory footing, supported by an injection of £7.3 billion of capital. The new national wealth fund will work alongside business to unlock billions of pounds in private sector investment in the industries of the future. In answer to the noble Lord, Lord Fox, the fund will bring together the UK’s currently fragmented landscape of public finance institutions, including the UK Infrastructure Bank, which, to reassure the noble Lord, Lord Vaux of Harrowden, is already achieving a 3:1 ratio, crowding in additional investment. I say to the noble Baroness, Lady Noakes, that it will continue to operate according to the additionality principle. This will deliver the greater clarity and certainty that firms need to invest. Further details will be set out ahead of the Government’s Global Investment Summit later in the year.
My noble friend Lord Wood of Anfield asked about the risk appetite of the national wealth fund. The UK Infrastructure Bank already engages in concessional activity, and we will keep under review whether it requires any additional levers to support the national wealth fund’s objectives. I completely agree with my noble friend Lord Drayson’s focus on scale-up capital and that we need as a country to improve in this area.
The Great British Energy Bill further supports the Government’s growth mission. It delivers on our manifesto commitment to establish a clean power company designed to boost energy security, decarbonise the power sector by 2030 and create new skilled jobs. I agree strongly with the speeches of my noble friends Lady Young of Old Scone and Lord Grantchester on these points.
We have also immediately honoured our manifesto commitment to end the ban on new onshore wind in England. In answer to the question from the noble Lord, Lord Wigley, I say that the Secretary of State for Energy and Net Zero has said he will examine the current plans for SMRs and set out more detail in due course.
Alongside investment must come reform. I will start with the planning system, the single greatest obstacle to our economic success. Our planning system is a barrier to opportunity, to growth and to home ownership. It leaves far too many important projects tied up in years of red tape before shovels ever get into the ground.
On our first full day in the Treasury, the Chancellor announced immediate action to begin to fix the planning system and help deliver our mission to kick-start economic growth. The planning and infrastructure Bill is part of a once-in-a-generation overhaul of our planning system to deliver 1.5 million extra homes and the high-quality infrastructure fundamental to our ambitions for decarbonisation and—as mentioned by my noble friend Lord Stansgate—growth. To grow our economy, we cannot rely on just a few pockets of the country to drive growth and productivity. I agree with the noble Lords, Lord Heseltine and Lord Monks, that too many areas have been held back because decisions are taken in Westminster, rather than by local leaders who understand local ambitions and strengths. We must push power out of Westminster and empower local leaders to deliver for their communities, through local growth plans and the English devolution Bill.
I agree with the noble Lord, Lord Birt, that our skills system also needs reform; it is one of the most persistent policy failures in the UK. We must invest in our education system to build the workforce of the future. My noble friend Lord Layard spoke passionately about his proposal for an apprenticeship guarantee, which I can assure him will definitely receive further and careful consideration. As a first step, we will replace the apprenticeship levy with a new growth and skills levy.
The current skills system is not delivering the STEM and engineering skills our country needs to strengthen the whole skills system. The Skills England Bill will bring forward a comprehensive strategy for post-16 education to ensure that we can address skills shortages, support economic growth and deliver our industrial strategy. In answer to the noble Lord, Lord Fox, I say that it will start work immediately on an assessment of skills needs.
However, addressing the skills gap is a necessary but not sufficient requirement for economic success. As my noble friend Lady O’Grady of Upper Holloway said, and I say in answer to the noble Lord, Lord Frost, there is now a wealth of evidence that greater in-work security, better pay and more autonomy in the workplace have substantial economic benefits. A more secure and productive workforce is good for business and for working people, because each depends on the success of the other.
This understanding lies at the heart of the employment rights Bill, which the Government will introduce within the first 100 days of coming to power. It will introduce a new deal for working people to ban exploitative practices and enhance employment rights. The plan to make work pay commits to delivering a genuine living wage, ending exploitative zero-hours contracts, ending fire and rehire, and introducing basic rights from day one. We will continue to work closely with business as we deliver and implement these policies. In answer to the noble Lord, Lord Elliott, I say that we remain committed to our manifesto’s long-term ambition of an 80% employment rate.
The plan to make work pay, alongside reforms to the welfare system, will help to reduce the huge levels of economic inactivity inherited from the last Government—mentioned by my noble friend Lord Layard, the noble Lords, Lord Birt and Lord Wigley, and the noble Baroness, Lady Blackwood of North Oxford—with 700,000 more people economically inactive since the pandemic. I agree with the noble Lords, Lord Holmes of Richmond, Lord Touhig and Lord Shinkwin, on the disability employment gap.
The plan to make work pay also forms a major plank of our child poverty strategy. The last Labour Government reduced child poverty by 600,000, while it increased by 700,000 over the past 14 years, so tackling child poverty is a major priority for this Government. The Secretaries of State for Work and Pensions and for Education will co-chair a new ministerial task force to drive cross-government action on child poverty, starting with developing an ambitious new strategy in line with the Government’s opportunity mission, for which I welcome the support of the noble Baroness, Lady Benjamin. This will include delivering the measures in our manifesto to support children and families, including free breakfast clubs in every primary school, expanding childcare, stronger protection for families who rent privately, and action to reduce fuel poverty. Alongside this, we will review universal credit so that it makes work pay and tackles poverty.
To answer a very specific question from the noble Lord, Lord Palmer of Childs Hill, I am told there are no plans to digitise the NCC1 form. He and the noble Lords, Lord Wigley and Lord Sikka, and the noble Baronesses, Lady Benjamin and Lady Kramer, asked about ending the two-child limit, which was not in our manifesto. As I have said, we will develop an ambitious child poverty strategy, but we will also adhere to the manifesto this Government were elected on, line 1 of which says:
“Every commitment a Labour government makes will be based on sound money and economic stability. This is a non-negotiable principle”.
The manifesto commitments we made will be delivered on, and we will not make promises we cannot afford or keep.
I welcome the contribution of the noble Baroness, Lady Kidron, and her determination to make children’s online safety a priority. I am pleased she has welcomed the Government’s commitment so far. There is clearly more to be done to make children safe, and my noble friend Lady Jones has said that she will be happy to meet the cross-party Lords tech team to follow this up.
The gracious Speech also set out reforms to the rail sector, contained in two railway Bills, one of which establishes Great British Railways. The noble Lord, Lord Sikka, asked about those companies whose contracts do not expire in the next five years. Their contracts have clauses that can be triggered so that they expire in that timeframe. In answer to the noble Lord, Lord Fox, the Government are not reversing the decision to cancel the second phase of HS2, but we are committed to addressing key transport connectivity issues across the country that are constraining our growth ambitions. To answer the noble Lord, Lord Bradshaw, individual projects will be considered through the spending review, with a particular emphasis given to those that drive growth. In answer to the right reverend Prelate the Bishop of Leeds, the Government are committed to improving rail connectivity across the north. Electrification and infrastructure modernisation will provide environmental benefits and support economic growth and job creation. Key to this will be completing delivery of ongoing major rail programmes—notably the trans-Pennine route upgrade.
A reset is also needed in our trading relationships, as many noble Lords spoke about this evening. The rushed and ill-conceived Brexit deal has created trade barriers equivalent to a 13% increase in tariffs for our manufacturing sector, and a 21% increase in tariffs for our services sector, as mentioned by the noble Lord, Lord Inglewood. As a result, the OBR has found that long-run GDP is expected to be 4% lower. The European Union is one of our strongest and closest partners and the Government are committed to resetting our relationship—to strengthen ties, reinforce our steadfast commitment to security, and tackle barriers to trade.
In answer to the noble Baroness, Lady Stowell of Beeston, we will work closely with the EU but proceed in a different way from it on AI. In answer to the noble Lord, Lord Holmes of Richmond, the Government will pursue highly targeted legislation to protect innovation. We must, though, tackle the red tape currently holding our exporters back. The noble Lord, Lord Kakkar, asked about visas. We will begin by pursuing our manifesto commitments on a new veterinary agreement, an agreement on touring visas and the mutual recognition of professional qualifications.
The gracious Speech begins the work necessary to deliver on our mandate to fix the foundations of our economy, to rebuild Britain, and to make every part of our country better off. Our approach is founded on the pillars of stability, investment and reform: stability, so we never again see a repeat of the disastrous mini-Budget and the damage it did to family finances; investment, through partnership between a strategic state and enterprising business; and reform, to confront and overcome the barriers to success that have, for too long, held our country back.
We are under no illusions about the scale of the challenge we face. We know it cannot be turned around overnight. There is much more to do, many more tough decisions to be taken, but the work towards a decade of national renewal has begun.