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Oral Answers to Questions
(2 months ago)
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Pete Wishart (Perth and Kinross-shire) (SNP)
The Parliamentary Under-Secretary of State for the Home Department (Seema Malhotra)
The hon. Gentleman has raised this issue on a number of occasions. He will be aware that we are not introducing a Scottish visa scheme or devolving control of immigration policy, and this has been made clear to the Scottish Government. Instead, we must together address the underlying causes of skills shortages and overseas recruitment in different parts of the UK, which this Government are doing.
Pete Wishart
I thank the Minister for her tiresome and repetitive response. She will know that Scotland has a whole range of demographic and population difficulties that need to be urgently addressed, with every sector from social care to hospitality, including business leaders, calling out for drastic action. Even her Scottish Labour colleagues are beginning to understand the enormity of this task. Today we find that Labour’s grotesque two-child benefit cap is now having an impact on Scotland’s birth rate. Instead of slapping down her Scottish colleagues and rejecting this idea out of hand, why does she not work with us just to see if it might actually work?
Seema Malhotra
The hon. Gentleman knows that net migration must come down. It trebled under the last Government, largely driven by overseas recruitment. Immigration is a reserved matter, working in the interests of the whole UK. Previous schemes along the lines that he has suggested have succeeded only in restricting movement and rights and creating internal UK borders. Adding different rules for different locations would also increase complexity and create frictions when workers move locations.
Chris Murray (Edinburgh East and Musselburgh) (Lab)
Scotland is a diverse place. Some areas are seeing depopulation, but areas such as East Lothian, which I represent, are seeing unprecedented population growth. Will the Minister commit to working constructively with the Scottish Government on their woeful population strategy, which in 17 years has comprehensively failed to address Scotland’s demographic challenges?
Seema Malhotra
We are committed to working with the Scottish Government on this and all issues. Indeed, many of the levers to address depopulation in Scotland are in powers that the Scottish Government already have at their disposal. The reasons for local workers leaving particular areas must be addressed through investment in jobs, in infrastructure and in public services, and many of these are issues that we must tackle together.
Phil Brickell (Bolton West) (Lab)
The Minister for Security (Dan Jarvis)
Fraud accounts for 39% of all crime, according to the England and Wales crime survey, and it was the most common type of crime in the year ending March 2024. It is a crime that destroys lives and we are committed to working with law enforcement and industry to better protect the public and businesses from the fraud threats they face.
Phil Brickell
We know that 39% of all reported crime is fraud, and many of those offences are carried out by serious organised crime gangs. The National Crime Agency is tasked with protecting my constituents from foreign origin fraud and serious organised crime, but a recent report from Spotlight on Corruption found that after 14 years of Conservative government the NCA was “on its knees”, spending millions of pounds on consultants and failing to retain investigators. What steps is the Minister taking to ensure that the NCA is able to protect my constituents from financial crime?
Dan Jarvis
Let me take this opportunity to pay tribute to the NCA for its operational leadership and its focus on tackling economic crime. Through collaborating with jurisdictions at risk, we make it harder for organised crime groups to target UK victims. The national fraud squad, run by the NCA’s national economic crime centre, and the City of London police, with 400 new officers by next year, have boosted the ability to tackle the highest-harm international offenders. We are working to deliver a workforce strategy to address retention challenges for fraud. This is important work that impacts on all our constituents and it is a priority area for this Government.
Mark Pritchard (The Wrekin) (Con)
The Minister will know that online harm goes beyond fraud. It can impact people’s lives through suicide sites that signpost people to unregulated sites that lead them to a place none of us want to see them go to. He will know that the European Commission is currently investigating Facebook and Instagram. The United States is introducing the kids online safety Act, which, if it is passed by Congress, will make a huge impact. Why is it left to parents in the United Kingdom—in England, Wales, Scotland and Northern Ireland, wherever they are—to take their own litigation against these big tech companies? Is it not time the Government did more?
Dan Jarvis
We are doing more, and I can assure the right hon. Gentleman that this is a key priority for the Department, not least because 70% of fraud has an international element, particularly online. Approximately one in 18 adults were victims of fraud in the year ending March 2024. The noble Lord Hanson leads on this for the Department, and he and I are working closely with other Government Departments, including the Treasury and the Department for Science, Innovation and Technology. This is a priority and we need to do more.
Ruth Cadbury (Brentford and Isleworth) (Lab)
Chris Vince (Harlow) (Lab/Co-op)
Peter Swallow (Bracknell) (Lab)
Deirdre Costigan (Ealing Southall) (Lab)
The Secretary of State for the Home Department (Yvette Cooper)
Neighbourhood policing is the bedrock of the British policing model, yet in many areas of the country it has been decimated in recent years. This Government are committed to rebuilding neighbourhood policing by putting officers, police community support officers and special constables back in our communities with new powers to tackle antisocial behaviour and local crime.
Ruth Cadbury
My constituents rightly want to see more neighbourhood policing teams on their streets. I welcome the Government’s commitment to bringing in 10,000 more neighbourhood police officers, but can the Secretary of State assure me that west London will get the neighbourhood policing teams we need?
Yvette Cooper
My hon. Friend is right that we now have thousands fewer police officers and PCSOs on the streets than we had a decade ago. This includes the previous Government halving the number of PCSOs and cutting the number of special constables by two thirds. This newly elected Government are working at pace to introduce a new neighbourhood policing guarantee, putting police officers and PCSOs back on the streets. We have also announced funding and support for the College of Policing to begin the national roll-out of specialist training for neighbourhood officers in order to professionalise and strengthen the work they do in every corner of the country.
Chris Vince
I welcome the Home Secretary to her place. My community in Harlow has been let down by the lack of neighbourhood policing. What will the Home Secretary do to address this issue, both through police on the streets and through the resources they have?
Yvette Cooper
My hon. Friend makes an important point. This is a challenge we are facing across the country. The proportion of people saying that they barely ever see the police is now nearly half, up from a quarter when the Conservatives came to power in 2010. This has been deeply damaging to public confidence, and we need the police back on the beat, but they also need the powers to act. That is why we will also bring forward new powers to tackle shoplifting and antisocial behaviour, especially in our town centres.
Peter Swallow
Residents in Bracknell are concerned about the increasing numbers of drug users and dealers on our streets. I raised this issue when I recently met our neighbourhood policing team. What more support can be given to local police and other local services to get drug dealers off our streets?
Yvette Cooper
My hon. Friend makes an important point. Drug dealing, drug misuse and other forms of antisocial behaviour and crime are a real challenge in many communities. First, we need to get neighbourhood police back on the beat to address these challenges. Secondly, neighbourhood police need greater powers, and we will introduce respect orders that allow the police to take action against repeat offenders and to make sure that our streets and communities can be kept safe.
Deirdre Costigan
In Ealing Southall, religious organisations are spending their own money protecting worshippers from antisocial behaviour and crime in the early morning. Sri Guru Singh Sabha gurdwara, for example, is spending £3,000 to £4,000 a week on patrols and security measures. I recently called a crime summit and, although the police are trying their best, the community needs more police on the streets and a return to neighbourhood policing. What progress has been made on recruiting the much-needed 13,000 new police and community support officers we need to restore trust in the safety of our communities and town centres?
Yvette Cooper
I thank my hon. Friend the Member for Ealing Southall (Deirdre Costigan) for the leadership she is showing in her community. The point she raises is partly about increasing neighbourhood police numbers, which is part of this Labour Government’s plan. It is also about ensuring that we have partnerships between the police and local communities, rather than communities feeling that they have to do this alone. Such partnerships between the police and communities are at the heart of the British model of policing by consent, which is what we need to restore and rebuild after the damage that has been done.
Sarah Dyke (Glastonbury and Somerton) (LD)
The cost of rural crime shot up by 41% in the south-west between 2022 and 2023, while 86% of respondents to a recent National Farmers Union survey said that rural crime was negatively affecting farmers’ mental health. How is the Department supporting neighbourhood officers and rural beats to adequately deal with the heightened levels of rural crime?
Yvette Cooper
The hon. Member makes a serious point. We need to increase neighbourhood policing in rural areas and to recognise the additional different challenges that rural areas can face, both because of the geography and the particular kinds of crime that affect farmers and farming equipment. That is why we have set out our intention to draw up a new rural crime action plan, alongside our plans for neighbourhood policing.
Graham Stuart (Beverley and Holderness) (Con)
Under the last Conservative Government, excluding fraud and computer misuse, crime fell by 50%—[Interruption.] I am pleased to say that in Beverley and Holderness, as across the rest of the country, it was community groups, local people and the police working together who helped to do that. Working with the local community, the Cherry Tree Centre helped to reduce antisocial behaviour in the St Nicholas area of Beverley by 43%, year on year, by last summer. What will the Secretary of State do to ensure that such community co-operation leads to further cuts in crime, which was so welcome under the Conservatives?
Yvette Cooper
I caution the right hon. Member against excluding one of the most common crimes in the country from his figures. Some of the crimes that impact town centres at the heart of local communities most heavily, such as shoplifting, street crime and street theft, have soared in recent years, but there was no response at all by the previous Government. We are making those crimes a priority as part of our plans to change some of the laws around shoplifting and assault on shop workers, as well as getting more police back on the beat.
Mr Tom Morrison (Cheadle) (LD)
One of the biggest problems faced by the neighbourhood police team in Cheadle is antisocial behaviour and the scourge of off-road bikes. What is the Secretary of State doing to help Greater Manchester police tackle off-road bikes in our communities?
Yvette Cooper
The hon. Member is right that off-road bikes are a total nightmare in some communities. I have talked to residents who have been driven mad by the scourge of dangerous off-road bikes that are used to harass and intimidate people. We are looking at ways to strengthen the law on off-road biking to give the police the powers they need to tackle that kind of damaging antisocial behaviour.
Alison Griffiths (Bognor Regis and Littlehampton) (Con)
Given the Home Secretary’s great concern about shoplifting and antisocial behaviour, will she make an assessment on the “Putting it Right” scheme for young offenders that has been successfully piloted in my constituency?
Yvette Cooper
I welcome the points the hon. Member makes. To tackle shoplifting, we need to ensure that strong enough laws and policing partnerships are in place, and that we do prevention and follow-up work with young people. As she may know, we are setting up a new Young Futures programme, which is all about the greater work we need to do to prevent young people being drawn into crime in the first place. I encourage her to tell us more details about her local work to tackle this issue.
Matt Vickers (Stockton West) (Con)
The last Conservative Government stood with our brave police officers and emergency service workers. We introduced tougher sentences for those who assaulted them and the Elizabeth medal to recognise those who lost their lives in the line of duty, and we were looking to recognise those who were discharged from service as a result of injuries on the frontline. Will the Secretary of State continue that work? Will she meet with me and former policeman Tom Curry, who has been leading an excellent campaign on this important issue?
Yvette Cooper
I have long been a strong supporter of the Elizabeth medal. I pay tribute to Bryn Hughes and others for their work campaigning for recognition for police officers and other emergency workers who have been lost in the line of duty, and who have given so much to support other people and keep others safe. I have attended the police bravery awards every year for the last 14 years, exactly because it is so important to support brave officers. I am absolutely determined to ensure that we not only continue with that work, but go further to support brave officers who put their lives at risk. I am very happy to continue cross-party working on this issue.
Lisa Smart (Hazel Grove) (LD)
In Greater Manchester, the “right care, right person” approach was recently introduced, since a police response to a mental health-related call is not always the right fit. There are growing concerns, though, about unclear lines of responsibility between mental health services and the police, which may cause cases to be mishandled. What steps are the Government taking to ensure that co-ordination between the police and mental health services is as clear and effective as it can be, so that those who most need support do not fall through the cracks?
Yvette Cooper
The hon. Member raises an important issue. That co-ordination between police and mental health services can be crucial in some of the most serious cases, where people are a danger to the public for reasons perhaps linked to a mental health crisis, but also in many cases where someone is not a danger to the public and mental health professionals may be far better able to respond than police officers. Significant work has been done, but she is right that we need further close working between police and mental health services across the country. That has also been part of the work that my right hon. Friend the Health Secretary is doing in the NHS and the Department of Health and Social Care on improving mental health services.
Amanda Martin (Portsmouth North) (Lab)
Damien Egan (Bristol North East) (Lab)
Mr Speaker
Can I ask the Home Secretary please to look at me occasionally? It would help.
The Secretary of State for the Home Department (Yvette Cooper)
Apologies, Mr Speaker; I always like the chance to be able to look towards you.
The criminal smuggling and trafficking gangs that organise small boat crossings are undermining our border security and putting lives at risk. It is truly tragic that a little baby died in the channel this weekend. Those gangs have been getting away with this for far too long. That is why the Government have set up a new border security command, led by former police chief Martin Hewitt, to work with other countries to go after the gangs.
Amanda Martin
Small boat crossings is an issue raised by residents, but we know that organised crime stretches beyond people smuggling. In my Portsmouth North constituency we recently saw the sentencing of a criminal gang that attempted to smuggle 2.3 tonnes of cocaine into the city from Colombia. Can the Secretary of State expand on how we are tackling organised crime relating to smuggling drugs and dangerous weapons into our ports, to ensure that those things do not hit our streets?
Yvette Cooper
My hon. Friend makes an important point. There are many different threats to our border security, which is why we have set up the border security command to draw together the work of different agencies, including on dangerous drug smuggling and organised crime, bringing together Border Force, the National Crime Agency, the intelligence and security agencies and local police forces. The border security command’s first priority will be to deal with the dangerous boat crossings that are undermining security and putting lives at risk, but as part of its work it will be dealing with the wider threats to our borders as well.
Damien Egan
I thank the Home Secretary for her answer about the criminal gangs. People in Bristol North East also ask me about deterrence. What reassurance can I give them that this action is being backed up with measures to stop illegal working by people who do not have a right to work here?
Yvette Cooper
My hon. Friend makes an important point about how employers have exploited illegal migration. As a result, we set up a major programme through the summer, including raids, pursuing illegal working in different places across the country. We have also substantially increased our work on returns, including redeploying 1,000 additional staff to work on returns and enforcement, to make sure the rules are being properly respected and enforced. That has led to an increase of more than 20% in enforced returns this summer.
Rupert Lowe (Great Yarmouth) (Reform)
Given that dangerous foreign criminals have been using the European convention on human rights as a loophole to remain in the UK, does the Home Secretary agree that it is time to leave the ECHR and restore the sovereignty of our own borders?
Yvette Cooper
The purpose of setting up a border security command is to strengthen the security of our borders. We will do that by working with other countries. It is crucial that we do so to tackle the gangs and the boats before they reach the French coast in the first place. We have increased our co-operation, with new agreements in place with the G7, Europol and Italy, and we are working on new agreements with France, Germany and Belgium. Those agreements would not be possible if we were somehow abandoning international law.
Mr Gagan Mohindra (South West Hertfordshire) (Con)
As the House will be aware, there have been recent crossings. Is the Home Secretary considering reopening hotels to house asylum seekers, and if so will she commit to keeping the House informed about the methodology for choosing those hotels and ensuring that constituency Members are informed at the appropriate time?
Yvette Cooper
Ensuring that constituency Members are informed is something that I take seriously. It often did not happen in the past, but it is important and it needs to happen. The overall situation that we inherited included an asylum backlog that was increasing because asylum decision making had totally collapsed. We have now increased that decision making so that we can clear the backlog and end hotel use. Sadly, that will take time—because of the soaring backlog we inherited as a result of the collapse in decision making—but we are determined to ensure that we can clear the backlog and save the taxpayer hundreds of millions, if not billions, of pounds.
Paul Holmes (Hamble Valley) (Con)
Given the Home Secretary’s claim that she would smash the gangs, with £540 million to upgrade the Manston centre, asylum hotels reopening rapidly and 14,000 small boat crossings since she took office, is that the plan that she had for her new border commander? Might it be fair to say that it is not going very well?
Yvette Cooper
I gently point out to the hon. Gentleman what we inherited from the previous Government. In the first six months of the year, there were the highest number of boat crossings on record because of the total failure of their programme, including spending £700 million on a scheme to send four people—four volunteers—to Rwanda. As for the contract, he may be interested to learn that the first Manston contract notice was issued on 4 December 2023 under the previous Home Secretary for £700 million for six years with no suggested break clauses. The new contract is not only substantially cheaper because we have made savings, but also includes break clauses so that we can close, change or reduce the contract to save the taxpayer money, which the previous Government failed to do.
Matt Western (Warwick and Leamington) (Lab)
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
Siân Berry (Brighton Pavilion) (Green)
The Parliamentary Under-Secretary of State for the Home Department (Jess Phillips)
Restoring confidence in policing is one of the core aims of the Government’s safer streets mission. That means ensuring robust responses to the crimes that devastate lives and corrode our communities. We are also committed to improving police standards, and will announce steps to strengthen the police misconduct and vetting system shortly.
Matt Western
It is almost two years since Warwickshire police issued a community protection notice against Warwickshire hunt. Eight months later, it was mysteriously replaced by a secret protocol. The police and crime commissioner, who receives financial support from the Countryside Alliance, claims that he knew nothing of the protocol. The chief constable refused to give me a copy and now she has resigned, claiming retirement. Trust in the PCC and the leadership of Warwickshire police has been seriously damaged. Will the Minister meet me to discuss the need for a truly independent inquiry, as opposed to the sham one being undertaken by the PCC?
Jess Phillips
I thank my hon. Friend and as a local to Warwickshire I take a keen interest in those matters myself. Of course, I will meet him, along with the Minister for Policing, Fire and Crime Prevention, my right hon. Friend the Member for Kingston upon Hull North and Cottingham (Dame Diana Johnson). It is vital that the public can trust that those who police us, and who are in charge of our police, are held to account as everybody else should be.
Jayne Kirkham
Despite town and city councils in Cornwall employing street rangers and antisocial behaviour officers and having ShopWatch radios funded from their precept or business improvement districts, shop managers still struggle with shoplifting and ASB. The record under our Conservative PCC on answering and responding to 101 calls is poor, and those crimes are chronically under-reported. Shop workers feel powerless and there is a desperate need for more neighbourhood police. Can the Minister explain how trust in police and the rule of law will be restored to retail staff and shop managers?
Jess Phillips
As the Home Secretary laid out, extra neighbourhood policing is important not just because we need more police on our streets, but because when our constituents—shop workers and those who own businesses—call the police, if they get no response confidence drops. The neighbourhood police that there will be across the country, including in Cornwall, will help with confidence, not just with crime.
Siân Berry
I thank the Minister for her answers. We have seen a toxic culture in some police services, including WhatsApp messages that are racist, homophobic and sexist, displaying deep prejudice. Will she clarify when the multiple recommendations from the Home Office review into the process of police officer dismissals will be actioned, including changing the law so that those who fail re-vetting can be more simply dismissed?
Jess Phillips
I could not agree more that we need to strengthen this area, with women especially feeling less confidence over the last few years. We will announce in due course—I promise the hon. Lady that we are working on this at pace—how we are going to ensure that police conduct and vetting systems are fit for purpose, to bring back some of the trust that has been lost.
Mr Adnan Hussain (Blackburn) (Ind)
Although I welcome the Home Secretary’s response on antisocial behaviour involving e-scooters and bikes, I wish to reiterate the concerns of my residents in Blackburn. Will she consider not only additional powers for the police but civil powers for local authorities to combat hotspot areas before somebody is seriously hurt?
Jess Phillips
As the Home Secretary outlined on neighbourhood policing, we will bring in respect orders to ensure that antisocial behaviour in particular areas is targeted in a way that it simply has not been in recent years.
Mr James Cleverly (Braintree) (Con)
The operational independence of the police goes to the heart of public confidence in policing. As Foreign Secretary, I saw where political interference in policing is rife, and that is not a direction that the UK should travel in, so does the Home Secretary believe that it is right for Ministers to overrule the threat assessment of the police and security services, does she believe that some free concert tickets are the appropriate price for scrapping police independence, and after the appalling results of recent negotiations with the British Medical Association, the RMT and Mauritius, has she considered recruiting Taylor Swift’s mum as a Government negotiator?
Jess Phillips
As it falls to me to answer this, let me say that the right hon. Gentleman knows fine well that operational decisions for policing fall to the police, in this situation and in every other. I would certainly welcome it if Taylor Swift’s mother stood for the leadership of the Conservative party; she would really offer something that is not currently available. The substantive question was about confidence. The confidence of women in policing, and its ability to keep women in our country secure, dived under the previous Government, so confidence definitely needs to be restored.
Mr Speaker
Order. We do not want squabbles afterwards. I call James Cleverly to ask his second question.
Mr Cleverly
When I was Home Secretary, on numerous occasions I had to deal with foreign VIPs demanding, or requesting, a level of protection that we did not feel was appropriate. Does the Home Secretary recognise the difficult position that she has put her own Foreign Secretary in when such future requests come in and they have to be denied, as those individuals will pray in aid the protection package put in place for a rockstar?
Jess Phillips
I remind the right hon. Gentleman and the House that concerts were cancelled in Vienna because of a terror threat that the CIA identified could harm tens of thousands of people. I sat in this very Chamber last week in front of Figen Murray—the mother of Martyn, who was killed at an event in Manchester. The idea that we should not take that security seriously is, I am afraid, something that I simply do not agree with.
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
The Secretary of State for the Home Department (Yvette Cooper)
Knife crime takes far too many young lives in this country, so the Government have set a mission—not just for the Government but for policing and local communities right across the country—to halve knife crime over the next decade. As part of that, we have already implemented the ban on zombie knives and zombie-style machetes, and we will now act quickly to ban ninja swords following the campaigning by Pooja Kanda after the death of her son.
Florence Eshalomi
I thank the Home Secretary for that reply on knife crime. I welcome the Government’s commitment in the Young Futures programme to preventing young people from being drawn into crime. A number of gang-associated girls are drawn into crime, and although rape and sexual exploitation is such a traumatising experience, many of those young girls do not see themselves as victims. Fantastic organisations such as Abianda and Milk Honey Bees work to support women. Will the Department consider providing tailored support for young women through the Young Futures programme?
Yvette Cooper
My hon. Friend makes an important point. I know that she has championed that issue over many years. The Young Futures programme will include youth hubs to draw together services around young people—I used the concept of a teenage Sure Start to bring young people’s services together. We also need youth prevention programmes across all areas. She is right to highlight that this must be about young girls as well as young boys to ensure that we tackle the threats to young people’s safety from violent crime.
Mims Davies (East Grinstead and Uckfield) (Con)
Helping young people to stay safe, and to have somewhere to go and, crucially, someone to talk to, is key to their transition in life, particularly to prevent them from being drawn into antisocial behaviour, retail crime and knife or gang-related crime. Could the Home Secretary confirm that, through devolution, there will be continued support for police and crime commissioners, such as Katie Bourne in Sussex, who can provide a direct link between residents’ concerns about their young people and work with local police to take preventive measures?
Yvette Cooper
Police and crime commissioners have a crucial role to play as part of the mission to reduce serious violence, as do local authorities. The hon. Lady is right that local partnerships will best be able to target young people who are at greatest risk, and ensure that proper prevention programmes are in place. As we know, many of those services have been hollowed out over a long period, and it is important that we have partnership working to rebuild them. I hope that we can work cross-party on that—not just with police and crime commissioners but with MPs across the country.
Bell Ribeiro-Addy (Clapham and Brixton Hill) (Lab)
The Minister for Policing, Fire and Crime Prevention (Dame Diana Johnson)
Like my hon. Friend, the Government value the role of peaceful protest as part of our proud democratic tradition. The Government regularly review the adequacy of existing legislation.
Bell Ribeiro-Addy
The right to protest, and the courage of people taking to the streets to demand change, have given us many of our cherished social advancements—from the suffragettes demanding votes for women to the Race Relations Act 1965—but the sheer number of powers to restrict protest is resulting in peaceful protesters being arrested and sentenced to lengthy periods in prison. The previous Government pushed through a range of such laws despite opposition from senior policing figures and from Members across all parties. When will a comprehensive review of the state of protest take place, with a view to repealing powers that unnecessarily restrict the right to peaceful protest?
Dame Diana Johnson
I am grateful to my hon. Friend for raising that important issue. As she knows, there will be post-legislative scrutiny of the legislation passed by the previous Government. As the previous Government agreed, it will be considered in due course.
Mr Richard Holden (Basildon and Billericay) (Con)
Recent footage of Metropolitan police officers saying that the description of Hezbollah as a terror group was a matter of “opinion” is alarming. The officers in question were deployed to a march in central London where support for Hezbollah was openly displayed, yet many offenders were only identified by photos on social media after the event. Will the Minister ensure that all officers are fully briefed on the proscribed status of Hezbollah, Hamas and other terrorist organisations, so that offenders are arrested on the spot, and not allowed to spew antisemitic hate on our streets?
Dame Diana Johnson
We are all clear that Hezbollah are a proscribed organisation. The police take great care when they police protests; there is a great deal of briefing for officers beforehand. However, the way that those protests are policed is operationally independent. I have been to see and talk to officers who are on the frontline at those protests, and I know that it is a difficult job. We should all say a big “thank you” for the work that they do. There have been many protests over the last 12 months that the police have dealt with, and many officers have had rest days cancelled to ensure adequate policing on our streets.
Neil Coyle (Bermondsey and Old Southwark) (Lab)
Southwark police officers recently told Bermondsey safety action group that they struggled to prevent or solve crime due to extraction duties, when they have to police repeat protests elsewhere in London. Does the Minister believe that the Met needs new powers to refuse permission for some repetitive protests in the capital, or should it use existing powers better to resolve and reduce extraction duties and increase safety in my community?
Dame Diana Johnson
Police numbers are an issue, which is why this Government are clear about recruiting more neighbourhood police officers to increase that presence on our streets. I recognise that what my hon. Friend has said about extraction is an issue for the Metropolitan police in particular when dealing with protests. Clearly, we want all criminals to be dealt with by the police, and we need sufficient numbers of police officers to do that.
Christine Jardine (Edinburgh West) (LD)
Although we respect and would protect the right to peaceful protest, antisemitic and Islamophobic offences have been reported at many recent protests. Those have contributed to an astonishing and shocking 25% increase in religiously aggravated hate crimes in this country, as was revealed last week. The Community Security Trust reports an almost 500% rise in antisemitic incidents, and Tell MAMA has recorded the highest ever number of anti-Muslim incidents. Can the Minister reassure us on what the Government will do to help the police continue to keep communities safe, and police protests in a way that does that?
Dame Diana Johnson
The figures that the hon. Lady sets out are shocking. This Government are clear that there is no place in our society for antisemitism or Islamophobia. There are already meetings about how we can tackle that rise. It is shocking and it will not be tolerated. In some recent protests, the police have clearly had a difficult job to do, but I commend their work to tackle antisemitism and Islamophobia. We know that the police take their responsibilities seriously and that they do so without fear or favour.
Andrew Rosindell (Romford) (Con)
The Minister for Policing, Fire and Crime Prevention (Dame Diana Johnson)
The Government are of course committed to ensuring that the police have the resources that they need to tackle crime effectively. As I am sure the hon. Gentleman knows, funding beyond this year, including for the Metropolitan Police Service, will be confirmed following the upcoming multi-year spending review.
Andrew Rosindell
Given the increasing pressures on the police service, does the Minister accept that officer morale, retention, recruitment and ability to solve crimes are severely compromised, with police officers overworked, underpaid and subjected to unprecedented rises in bureaucratic processes—often dealing with things that police do not traditionally deal with, such as mental health care and social work? [ Interruption. ] Will the Minister explain how the Government plan to address those critical issues, especially in terms of improving officer retention, recruitment, crime-solving capacity and the overwhelming levels of bureaucracy, so that constituents in Romford can feel safe in their own town again? [ Interruption. ]
Mr Speaker
Order. Mr Rosindell, you should know better. I did not cough twice for my own benefit—it was meant to be for yours.
Dame Diana Johnson
The hon. Gentleman is a very experienced Member of this House. He has supported 14 years of Conservative government that have left us coming into government with a criminal justice system, including policing, that is in grave difficulty. I take the point that he raises, but he needs to recognise the role that he and his party have played in getting us to this point. Our aim now is to recruit more police officers, as the Home Secretary has said, and to increase neighbourhood policing as the bedrock of policing in this country.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
We all want to see more funding for our police in Havering and Hackney and across London, but a reduction in crime would also help them. What conversations are Ministers having with mobile phone manufacturers to try to drive down phone snatches by people on bikes and reduce such street crime, which is really growing in London?
Dame Diana Johnson
I am very grateful to my hon. Friend for raising that point. Those conversations are ongoing; later this month, conversations will take place on what more can be done to ensure that the manufacturers take their responsibility seriously and do everything they can to stop the trade in parts, which is a particular issue with mobile phones.
Nadia Whittome (Nottingham East) (Lab)
The Minister for Border Security and Asylum (Dame Angela Eagle)
Mr Speaker, I suspect I might be coughing almost as much as you, but for a completely different reason.
We constantly update our assessment of LGBT rights and other factors affecting the safety of different countries, working closely with the Foreign Office and informed by regular independent reports from the chief inspector of borders and immigration. The latest update for Georgia was published last month and is available on the gov.uk website.
Nadia Whittome
The safe state designation that the previous Government introduced was intended to allow Georgian and Indian nationals to be returned without any individualised assessment of the safety of the country for each person. In both countries, persecution of certain minorities is on the rise; that makes their inclusion on the list particularly wrong, but also highlights the wider dangers of blanket inadmissibility of asylum claims based on nationality. What steps will the Government take to ensure that individuals’ asylum claims are always properly assessed?
Dame Angela Eagle
I thank my hon. Friend for raising this important issue and bringing her concerns—concerns that I share—to the attention of the House. We regularly monitor and review the situation in countries of origin, working closely with the Foreign Office, and our resulting country policy and information notes are published on the gov.uk website. Should we assess that the troubling new law to which my hon. Friend refers, or any other changes, fundamentally affect the justification for Georgia’s designation, we will seek to remove it from the list, using the correct parliamentary process.
Jim Shannon (Strangford) (DUP)
In Georgia in particular, but also in other countries, there is an evidential base to prove that the persecution of Christians and ethnic minorities and other human rights abuses are taking place. It is also important that LGBT rights issues are engaged with. Has the Minister had the opportunity to address those issues directly with Georgia’s Government?
Dame Angela Eagle
Addressing such issues is more of a Foreign Office responsibility, which is why we liaise closely with the Foreign Office when considering the production of information notes. If laws that are passed and put into effect in other countries lead to persecution or a well-founded fear of persecution for individuals, that is one of the contexts we use to make a decision. That includes LGBT rights, but also other rights.
Katrina Murray (Cumbernauld and Kirkintilloch) (Lab)
The Secretary of State for the Home Department (Yvette Cooper)
Organised immigration crime puts lives at risk and threatens our border security. We have agreed a new anti-smuggling action plan with our G7 partners to strengthen collaboration in areas such as intelligence, information exchange and the pursuit of criminal finances. The UK work will be led by the new border security command. As evidence of our closer collaboration with other countries, this weekend, at the request of the French authorities, a Border Force vessel rescued 46 people and returned them to France.
Katrina Murray
According to research by UK Feminista, over a third of female school pupils have been sexually harassed while at school. Much of this can be traced back to misogynistic online influencers and the harmful impacts of pornography. Will the Home Secretary tell the House what she is doing to prioritise women’s online safety and how she is engaging with counterparts in the devolved Administrations to ensure that no woman or girl is left behind when it comes to ending sexual harassment and the exploitation of women?
Yvette Cooper
My hon. Friend makes an extremely important point. The mission for safer streets that the Government have set includes a really ambitious mission to halve violence against women and girls in a decade. We know that that is immensely difficult, and I hope that all the devolved Administrations, as well as local communities and organisations, will want to be part of it. My hon. Friend is right to prioritise women’s online safety, and that is why my right hon. Friend the Secretary of State for Science, Innovation and Technology is prioritising action on online deepfake abuse.
Mr James Cleverly (Braintree) (Con)
In her statement to the House on 29 July, the Chancellor said that asylum accommodation costs being drawn down from Treasury reserves were “unfunded and undisclosed”—a description that I reject. Can the Home Secretary now confirm to the House that asylum accommodation costs will be disclosed and, more importantly, funded from her departmental budget, and that she will not be drawing down from Treasury reserves to pay for asylum accommodation costs? Will she reject the Chancellor’s description and say that she will fund those costs in the same way that I did?
Yvette Cooper
The former Home Secretary—the current shadow Home Secretary—now seems to be admitting to the totally chaotic state of asylum accommodation finances. He had to continually seek last-minute reserve claims, because his Government had underfunded the asylum accommodation problems that they had caused by letting the asylum backlog soar. As a result, the taxpayer ended up footing the bill. This Government will be making savings from asylum accommodation by getting the system back in order. I know that the right hon. Member has been kicked out of the Tory party leadership contest because he cannot count.
Mr Speaker
Order. I say to the Home Secretary that I expect short answers. These are topicals. If there are questions where she wants to go long, she should do so early. Otherwise, it is not fair to the Back Benchers I represent on both sides of the House. We will now be staying here longer than she probably expected. James Cleverly, let us have a good example of a short topical.
Mr Cleverly
Will she be drawing down from Treasury reserves—yes or no?
Yvette Cooper
This Government have already been putting in place the funding to try to make good the total chaos that the right hon. Member’s Government left us with. They spent £700 million to send four volunteers to Rwanda—and how much did he spend on a flight?
Steve Race (Exeter) (Lab)
Yvette Cooper
My hon. Friend is right that we have an extensive challenge with the backlog, which means that very expensive hotels are too often used as asylum accommodation. We need to clear the backlog and ensure that we end hotel use, but that also means addressing the serious challenges around violence against women and girls.
Lisa Smart (Hazel Grove) (LD)
This is Black History Month, and we honour the Windrush generation, who were let down shamefully by the previous Conservative Government—first by the appalling Windrush scandal itself, but then by their failure to fully implement the Williams review and the compensation scheme. The parliamentary ombudsman has now found that the Home Office is wrongly denying compensation payments, so will the Home Secretary commit to urgently appointing a Windrush commissioner, as she promised back in June, to lead on righting these wrongs?
Yvette Cooper
We will be appointing a Windrush commissioner. This is something I feel strongly about. The hon. Member will know that as the Select Committee Chair, I asked many questions about the Windrush scandal. It is a stain not just on the Home Office, but on the British state, and it is important we right those wrongs.
Alan Strickland (Newton Aycliffe and Spennymoor) (Lab)
The Minister for Policing, Fire and Crime Prevention (Dame Diana Johnson)
As has been said a number of times this afternoon, the neighbourhood policing guarantee means 13,000 police officers, PCSOs and specials back on our streets to keep us all safe, after the reduction in police officer numbers of, I think, over 20,000 by the Conservative party.
Luke Taylor (Sutton and Cheam) (LD)
The Parliamentary Under-Secretary of State for the Home Department (Jess Phillips)
We are absolutely looking at how we can strengthen stalking protection orders. We will look at our stalking laws in the round, but also at how policing handles all cases of violence against women and girls and at the training that will be needed.
Jacob Collier (Burton and Uttoxeter) (Lab)
Dame Diana Johnson
Again, there is the neighbourhood policing guarantee and, importantly for my hon. Friend, there will be a named police officer in the community so people know who to go to when they need assistance. That work is happening now and we are keen to see the first officers in place in the next few months.
Blake Stephenson (Mid Bedfordshire) (Con)
Yvette Cooper
I gently remind the hon. Member that his party’s Government failed to review the funding formula for very many years. However, he is right that the issues of rural and urban areas are immensely important, which is why we have committed to a rural crime action plan.
Jack Abbott (Ipswich) (Lab/Co-op)
Dame Diana Johnson
As part of the spending review, we want to consider police funding in the round, including how police funding is allocated to forces. The sector, including the Association of Police and Crime Commissioners and the National Police Chiefs’ Council, is engaged in the process.
Mr Richard Holden (Basildon and Billericay) (Con)
The Parliamentary Under-Secretary of State for the Home Department (Seema Malhotra)
The Government are committed to bringing down legal migration. We will do so by making sure that British workers are upskilled in key sectors, with new requirements for employers to address skills shortages, and by introducing new training and workforce plans so that overseas recruitment does not remain the default for filling skills shortages in the UK.
Steve Yemm (Mansfield) (Lab)
Yvette Cooper
I think it is a matter for us all to take the security of people immensely seriously, and to ensure that terrorist, extremist and criminal threats do not win in their attempt to pose threats not just to life, but to our way of life.
Dame Karen Bradley (Staffordshire Moorlands) (Con)
Thank you, Mr Speaker, and I thank the House for putting its confidence in me to chair the Home Affairs Committee. I look forward to working constructively with the Department on home affairs matters. In that vein, may I welcome the news that the Government will recruit 200 new personnel to process modern slavery claims? Can the Secretary of State confirm whether those personnel are new head count, how long the training will take, and whether she is confident that the head count will survive the forthcoming Budget and spending review?
Yvette Cooper
I congratulate the right hon. Lady on her new position. It is a great job, and I look forward to giving evidence to her as she did to me—we will see what price I have to pay as the roles are reversed. She asks an important point about modern slavery numbers. We are recruiting additional members of staff, and I will happily provide her with more information about that crucial policy area.
Mr Paul Foster (South Ribble) (Lab)
Dame Diana Johnson
That is an important point, and we are actively exploring all ways that we can improve guidance around redaction, streamline current processes, make better use of technology, and ultimately reduce unnecessary burdens on the police and prosecutors, so that they can get on with their primary task of keeping the public safe and putting away criminals.
Nick Timothy (West Suffolk) (Con)
The Home Secretary told the House that by ending the retrospective element of the duty to remove she was saving £7 billion in 10 years. The impact assessment assumes that all those subject to the duty would have remained in Britain at a cost to the Home Office, but in his letter to me her permanent secretary said that the sum included the cost of sending the same migrants to Rwanda. I wrote to the Home Secretary about that on 1 September and I have raised it with the Minister for Immigration in Westminster Hall, but I have not had an answer. Can she explain that double counting, and if she cannot, will she apologise for using that statistic in the House of Commons?
Yvette Cooper
As the hon. Gentleman will know, the impact assessment is provided by the Home Office, and what we inherited from the previous Government was not simply the incredibly costly Rwanda programme, but also the retrospective element of the Illegal Migration Act 2023, which was so damaging that the shadow Home Secretary, when he was in the job, did not implement many of the measures. That retrospective element has cost the Home Office hundreds of millions of pounds, and those costs would go forward into the future.
Tim Roca (Macclesfield) (Lab)
We want to support genuine refugees, but will the Home Secretary provide an update on the progress on returns and deportations of illegal migrants, and say how the new command arrangements improve on the arrangements of the previous Government?
Yvette Cooper
My hon. Friend makes an important point. To tackle the chaos in the asylum system the rules need to be properly respected and enforced. That is why we have increased by more than 20% the enforced returns over the summer of those who have no right to be here. We have also increased the number of charter flights, including the biggest ever charter flight return.
Ben Maguire (North Cornwall) (LD)
Given that the turnout for the Devon and Cornwall police and crime commissioner election in May was just 18%, will the Minister look to scrap that role and instead invest that money in proper community policing in rural constituencies such as mine of North Cornwall?
Dame Diana Johnson
The Government have no plans to scrap the role of police and crime commissioner. We think it is a valuable role that can enable the missions that this Government have set out to be enacted locally, including the safer streets mission. We need to work with the PCCs to make sure that mission happens in the different force areas around the country. PCCs also have a role to play with their other partners, local authorities and the voluntary sector.
Dr Marie Tidball (Penistone and Stocksbridge) (Lab)
Noisy off-road bikes speed around neighbourhoods such as Chapeltown in my constituency, deliberately disturbing and intimidating residents. Will the Home Secretary commit to properly tackling off-road bikes by giving the police the right powers to crack down on this issue?
Yvette Cooper
My hon. Friend makes an important point, and I thank her for standing up for her community. We want to strengthen the law to give the police more powers to tackle the nightmare of dangerous off-road bikes.
Sir David Davis (Goole and Pocklington) (Con)
When last year the now Home Secretary called on the then Conservative Government to use counter-terror legislation to proscribe organisations such as the Islamic Revolutionary Guard Corps, she will remember that I supported her publicly. Since then, Iran and the IRGC have got even more dangerous. Has she changed her mind, and if so, why?
The Minister for Security (Dan Jarvis)
I have huge respect for the right hon. Gentleman, but I gently point out that he is asking the Government to do something that the previous Government did not do in 14 years. I can say to him that we are leading work on countering Iranian state threats, making use of the full breadth and expertise of our intelligence services and law enforcement agencies. We keep the list of proscribed organisations under very close review. I can assure him that work continues apace to identify further ways to tackle the threat.
Jon Pearce (High Peak) (Lab)
UK universities have experienced a fivefold increase in antisemitic incidents since the 7 October terrorist attacks. At a recent meeting of the Union of Jewish Students, I heard distressing examples of the Iranian regime organising on our campuses and stirring up hatred against Jewish students. Can the Minister tell the House what steps the Department is taking to deal with the threat posed by Tehran here on British soil?
Dan Jarvis
We have been clear that the behaviour of the Iranian regime, including the actions of the IRGC, poses a threat to the safety and security of the UK and our allies. The Government continually assess threats to the UK and take the protection of individuals’ rights, freedoms and safety incredibly seriously, wherever those threats may originate.
Mike Martin (Tunbridge Wells) (LD)
In 2023, the Home Office commissioned the Fairfield review into the Independent Office for Police Conduct. It deemed the delays in the IOPC as “unacceptable”. Indeed, one of my constituents has been waiting a year after the death of her daughter to have a case officer assigned. Does the Home Secretary agree with the review, and will she comment on when she will implement its 93 recommendations?
Yvette Cooper
I have met the IOPC chair to talk through the issues facing that body. The hon. Gentleman is right that we need to speed up the decision-making process. He will also recognise that there are considerable challenges in the system that we have inherited.
Dan Tomlinson (Chipping Barnet) (Lab)
I thank you, Mr Speaker, for making time for Back Benchers in the questions today. I rise to raise the issue of car theft in my constituency. Many hundreds of residents have had their cars stolen, and the police do not have the capacity to follow up. Next year, I am hosting a car theft summit in Chipping Barnet, and I invite the Minister to attend with me.
Dave Doogan (Angus and Perthshire Glens) (SNP)
After a bungled fraud investigation by Renault Crédit International, it, together with Renault-Nissan UK Ltd moved to seize the assets of a business in my constituency, Mackie Motors Brechin Ltd. This cost my constituent half a million pounds and 25% of his order book value. Will the Secretary of State meet me to discuss the finer points of this clearly very dubious act by a UK bank?
Dan Jarvis
I am concerned to hear about the case that the hon. Gentleman raises, and I would be happy to meet him to discuss it further.
Clive Lewis (Norwich South) (Lab)
I put on record my gratitude to the Home Secretary and her team for releasing the Home Office commissioned report, “The Historical Roots of the Windrush Scandal”, which concluded that 30 years of racist immigration legislation caused the Windrush scandal. Those now on the Opposition Benches spent three years trying to suppress that report. Will the Home Secretary meet me, other MPs and civil society representatives to discuss its recommendations?
Seema Malhotra
I thank my hon. Friend for raising that issue. It was a shocking report, and one that the previous Government refused to publish. I would be very happy to meet him and other hon. Members to discuss it.
Richard Tice (Boston and Skegness) (Reform)
Does the Home Secretary share my deep concerns about two-tier justice, given that some people who say some bad, stupid things on social media can be arrested, charged and jailed within a matter of weeks, but some people who brutally and violently assault police officers have not even been charged many months later?
Yvette Cooper
The hon. Member will know that in this country we have operational independence for the police, and independence for the Crown Prosecution Service and the courts. I strongly support police officers, who have faced cases of the most disgraceful violence and attacks. It is important that we support our police in the face of those attacks and ensure that they have the whole community behind them.
Gregor Poynton (Livingston) (Lab)
The Home Secretary may be aware of the data that the Internet Watch Foundation released last week on the increasing amount of AI-generated child sexual abuse content available to everyone on the internet, finding that it has increased in the last six months alone. That is clearly illegal, so what are the UK Government doing to stamp down on that horrific crime?
Jess Phillips
Let me make it clear that the new Government intend very swiftly to set up new taskforces to ensure that across Departments—in this case, with our counterparts in the Department for Science, Innovation and Technology—we do everything we can to end the scourge of online child abuse, and child abuse not online.
Jim Shannon (Strangford) (DUP)
I am always standing, Mr Speaker. What efforts have been taken in schools to show the opportunities available in the police force, to enhance career opportunities for young people?
Dr Johnson
It is always a pleasure to answer the hon. Gentleman. That work will be ongoing. We want to recruit from the widest possible groups in our communities, and to encourage young people to think about a career in policing.
St Helena: UK Immigration
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Paul Holmes (Hamble Valley) (Con)
(Urgent Question): To ask the Foreign Secretary if he will make a statement on the new immigration arrangements between the UK Government and St Helena.
The Minister of State, Foreign, Commonwealth and Development Office (Stephen Doughty)
I thank the hon. Gentleman for his question. I have been asked to reply as the Minister for the Overseas Territories. I know that these are issues of keen interest to you, Mr Speaker.
The House is aware that a political agreement has been reached with Mauritius about the long-term future of the British Indian Ocean Territory. Once any treaty with Mauritius comes into force, following its proper parliamentary scrutiny, Mauritius will be responsible for any migrants who arrive there. However, we needed to find an interim contingency solution for the period before that agreement comes into force. Given that there is no permanent population, BIOT has never been an appropriate long-term location for migrants due to the logistical challenges of providing appropriate care in such a remote place without civilian infrastructure.
On 15 October, a new memorandum of understanding was reached with the Government of St Helena so that any new migrants arriving in the interim period will be transferred to St Helena. The intention is for that agreement to last until the treaty with Mauritius comes into force, recalling that, in practice, no new migrants have arrived on Diego Garcia since 2022.
We are hugely grateful to the St Helena Government for their assistance. Their Chief Minister has said:
“This arrangement presents a unique opportunity for a British Overseas Territory to be in a position to assist the UK, and we are pleased to be able to work in close partnership with the UK Government towards a mutually beneficial solution.”
The UK Government have agreed to provide one-off funding of £6.65 million to St Helena to improve health and education outcomes, and upgrade government infrastructure. This is consistent with our long-term support to the community in St Helena, which is of course crucial. This is a long-term, consistent partnership. We will support St Helena by providing technical support, and funding the transfer and subsistence costs for any migrants affected. Of course, this is not the first time that St Helena has supported the wider UK family. The agreement is testament to its integral place in our family. We thank it for its support.
Paul Holmes
Thank you, Mr Speaker, for granting this urgent question. I must say that I am disappointed that, once again, the Government have chosen to make an important announcement outside this House, not within it, as they should.
Following on from the Government’s shameful decision to fast-track and capitulate on negotiations to hand over the British Indian Ocean Territory to Mauritius, it is clear that the policy announced over the weekend is a rushed consequence of a deal that does not serve British taxpayers well. This aspect of the deal has not been properly scrutinised by this House, and there has been no announcement on how we will scrutinise the wider issue of the transfer of sovereignty of the British Indian Ocean Territory to another country.
During the treaty negotiations, was this plan discussed? If the Government were so keen on signing away sovereignty, why was it not part of the deal that Mauritius would take responsibility for illegal migrants and take them to Mauritius from day one? Were Chagossians consulted on the plan? The Foreign Secretary said that they were updated throughout, but parliamentary questions have revealed that not to be the case.
Finally, how much will the deal cost, and what Department will be responsible? Will there be a drawdown of Treasury funds, or will the money come from Foreign, Commonwealth and Development Office budgets? Will the cost be added to the overall cost estimated for the sovereignty deal with Mauritius? Does this plan signify a change of heart on the policy of offshoring as a whole? Before Labour MPs stand up to espouse the deal and say how good it is, they should remind themselves that in the election campaign, they wrote in their leaflets that the offshoring of British citizens was immoral. Does this plan represent a change of policy from this Government?
Stephen Doughty
I am sorry that the hon. Gentleman has taken that tone. I set out very clearly in my statement the answer to a number of points that he raised. Matters have also been set out very clearly by the St Helena Government. They have indicated their full agreement. In fact, they were fully part of the process and there was full consultation with them. This is a mutually beneficial win-win for the UK Government and St Helena. As I said, the Chief Minister of St Helena has said that it is in a unique position to help the UK Government, and this will strengthen its reputation and enhance its partnership with the British family.
The hon. Gentleman asked a lot of questions about the arrangements with Mauritius. The Foreign Secretary spoke at great length about the arrangements with BIOT recently. The agreement will go through this House in the proper way, as has been set out, and will face proper parliamentary scrutiny. I am sure that it will attract scrutiny, and that is only right. As I explained, this is a contingency agreement for the period before any agreement with Mauritius comes into place; after that, it will take any migrants. The situation on BIOT is not suitable, long term, for migrants. We have explained that at great length.
I have to say that the Government inherited a mess, and we are taking pragmatic, sensible and proactive measures to address the situation. I am hugely grateful to St Helena for the role it is playing. This is a mutually beneficial win-win. The hon. Gentleman asked where the funds will come from. They will come from the FCDO. We already have a long-term established partnership with St Helena, and it has hugely welcomed this plan. It will help it to deal with a number of ongoing issues. I have set out the details fully. The full details of the agreement are also available from the St Helena Government.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It is welcome to hear St Helena mentioned in the House. The money going there amounts to an increase of about 20% in financial aid from the UK this year, which is sorely needed in a community that is so challenged; but will the Minister explain how he will convey people from BIOT to St Helena, given the travel difficulties, and tell us what conversations he has had with the Chief Minister and her Ministers about where these people will be accommodated, if they do arrive?
Stephen Doughty
I thank my hon. Friend for her interest in St Helena, which has been long-standing. I understand that she visited the island recently, and I welcome her ongoing engagement with the people and the Government there. We have made it clear that we would support the transfer of anyone who did arrive, but let me reiterate that no one has actually arrived on BIOT since 2022. This is a contingency measure only, and, of course, it is not a safe place for people to attempt to go to. This is about closing that route and ensuring that if anyone did make that attempt, they could go to a safe place and be properly supported. The St Helena Government have made clear how they would accommodate and integrate people in that community.
Mr Andrew Mitchell (Sutton Coldfield) (Con)
I thank my hon. Friend the Member for Hamble Valley (Paul Holmes) for raising this important matter. The whole House will welcome the Government’s sudden conversion to offshoring, even though this plan was not announced in the House in accordance with your specific instructions, Mr Speaker. I may be one of the only Members to have had the privilege of visiting St Helena, along with the hon. Member for Hackney North and Shoreditch—
Mr Mitchell
And you, of course, Mr Speaker. We may have been the only Members to survey the island’s new airport, which will in time relieve the British taxpayer of cost and open up the island to a very bright future, with connectivity massively enhanced.
While I was in St Helena, I met the oldest mammal on the planet, born a few years after Napoleon’s death: Jonathan the tortoise. I also visited the island’s impressive hospital, which provides very good healthcare but is a small facility whose function has been specifically tailored to serve the commensurately small community of St Helena. The cohort of people who might arrive from Diego Garcia are likely to have medical needs—indeed, as experience shows, quite complex medical needs. That will place additional pressure on St Helena’s healthcare infrastructure. What will the Minister do to help St Helena with that?
There is some disquiet among residents of St Helena at the thought that an influx of migrants could have an adverse impact on social cohesion and social provision in this very tightly knit community. What is the estimated number of migrants who will be sent there? Bearing in mind that the entire population is less than 5,000, will the Minister impose a limit—admittedly low, but nevertheless a limit? Has he made an assessment of how much this transfer policy will cost the British taxpayer? Of course, Conservative Members do not oppose the principle of offshoring, but we are perplexed by the Government’s choice of destination, a small British overseas territory thousands of miles from Diego Garcia, not least because a number of asylum seekers who landed on the British Indian Ocean Territory have already been transferred to Rwanda. Labour has of course scrapped the Rwanda scheme, so can the Minister tell the House whether the Government’s approach has changed, and whether they welcome offshoring as a means of injecting deterrence into the complexities of illegal migration?
Stephen Doughty
I thank the right hon. Gentleman for his comments and questions. He has always taken a keen interest in the overseas territories, and St Helena in particular. I am surprised that he is perplexed, because he and his fellow Ministers were grappling with these very decisions and issues in the last Government. We are providing pragmatic and practical solutions to respond to the situation that we inherited. There is no comparison with the Rwanda scheme. He will have just heard the Home Secretary say that spending £700 million of taxpayers’ money resulted in four volunteers for that scheme. This is a mutually beneficial win-win agreement between the United Kingdom and one of our overseas territories. I have set out the cost very clearly: £6.65 million for the contingency arrangement, and then the costs for anyone who does arrive. Let me reiterate, however, that no migrants have arrived on BIOT since 2022. This is a contingency arrangement that is absolutely necessary, but of course we hope that no one will choose to take such a dangerous route.
The right hon. Gentleman referred to the healthcare position. That is exactly why St Helena is a more suitable location for any theoretical migrants to be relocated to; facilities on that level do not exist on BIOT. He mentioned that there is allegedly disquiet in St Helena, but that is simply not the case. I read out very clearly what the St Helena Government and Chief Minister have said, and there are huge benefits to this plan. St Helena is a wonderful place. I have not had a chance to visit it, but I have had a chance to experience its culture, food and people, and I look forward to welcoming the Chief Minister to the Joint Ministerial Council in due course.
Oliver Ryan (Burnley) (Lab/Co-op)
I am interested to hear how offshoring is being rebranded; the Rwanda scheme was a huge failure. Does the Minister agree that any comparison between this plan and the Rwanda scheme is rubbish? The latter cost £700 million and resulted in four volunteers being sent to Rwanda. This is a far better scheme.
Stephen Doughty
My hon. Friend makes the point himself in his question: this is a mutually beneficial, win-win agreement between us and St Helena, whereas the other scheme cost £700 million and sent four volunteers to Rwanda. There is no comparison.
James MacCleary (Lewes) (LD)
The Liberal Democrats have already put on the record our concerns about the deal that was struck with Mauritius and how it excluded the voices of Chagossians. We also have concerns about the terms of the agreement. What will happen to the individuals who have been moved to St Helena after 18 months elapse? We cannot just abandon them. Will the Minister update the House on what will happen if an agreement with Mauritius has not been reached by the end of the 18-month period?
Can the Minister also update the House on the asylum seekers who have been detained on Diego Garcia, such as the 60 Sri Lankan Tamils? They are not in the scope of the agreement. Will the Government support those individuals in claiming asylum where they need it?
Finally, it has been reported today that there is an investigation under way into a major hack of the British high commission’s phones during the Chagos islands talks. What action are the Government taking to address this potentially major security breach?
Stephen Doughty
I thank the hon. Gentleman for his questions. As I said, the Foreign Secretary answered questions about the agreement with Mauritius on BIOT earlier, but the hon. Gentleman asks for further details of the arrangement with St Helena. Under the arrangement, if any migrants arrive on BIOT in the future, they will be transferred to St Helena. They will remain free to depart, and to return to their country of origin, but they will not be able to stay on BIOT. St Helena would take responsibility for accommodating those individuals and, if appropriate, processing asylum claims.
The hon. Gentleman mentions existing migrants on the island. They are not included in this arrangement, and we continue to work at pace to find long-term, durable solutions. I will not go into the details; that would be inappropriate, given the legal complexities around the small group of individuals who are there. On his point about the media coverage of alleged hacks, those are subject to an ongoing police investigation in Mauritius, so I do not want to comment, but my understanding is that the allegations are historical, rather than related to the recent negotiation period.
Dr Scott Arthur (Edinburgh South West) (Lab)
I really welcome the statement, and the clarity that has come with it. Who will ultimately be responsible for people when they find themselves in St Helena?
Stephen Doughty
I thank my hon. Friend for his question. Fundamentally, as a result of this agreement, St Helena has agreed to take responsibility for any theoretical migrants who arrive, but I draw him back to what I said earlier: Mauritius would take responsibility for any migrants who arrived after the agreement of the treaty, which we will seek to finalise following parliamentary scrutiny.
Andrew Rosindell (Romford) (Con)
The Minister really should understand that the British overseas territories are self-governing democracies, and they must make decisions about their own islands’ governance. Has the Legislative Council of St Helena voted in favour of this agreement? Have the people of St Helena been consulted? What impact will the influx of people potentially have on this small island territory of only 4,500 people, and will the agreement have any impact on Tristan da Cunha and Ascension Island, which, as the Minister knows, form part of the overall British overseas territories?
Stephen Doughty
I thank the hon. Gentleman for his question; I know he takes a very keen interest in this matter. We have discussed the overseas territories on many occasions, and he knows how seriously I take their democracy and autonomy. That is why it is important to reiterate to the House that this agreement was freely entered into by the Government of St Helena. They have publicly welcomed it profusely and explained why it is beneficial. Obviously, they are responsible for their internal processes within St Helena. We will continue to work with the Government of St Helena, their representatives and, indeed, their Attorney General as we move forward with the agreement. If I may, I will come back to the hon. Gentleman on the point he raises about Tristan da Cunha and Ascension, but the agreement is primarily about St Helena because of the facilities that are available there.
Elaine Stewart (Ayr, Carrick and Cumnock) (Lab)
Does the Minister agree that the UK’s new agreement with Mauritius will close a potentially dangerous illegal migrant route?
Stephen Doughty
My hon. Friend is right: BIOT is not a suitable place for migrants to be present. There is no permanent population and there are not the necessary education and health facilities. That is why we needed to put in place that part of our agreement with Mauritius: to ensure that during the interim, contingency period, were any migrants to arrive—as I said, none have arrived since 2022—they could go to a place where there were hospitals, education, and an economy and a community to support them. We thank St Helena for its help in this matter.
Sir Edward Leigh (Gainsborough) (Con)
If it is possible legally to deport illegal migrants from Diego Garcia to St Helena, is there any legal reason why we cannot deport illegal migrants landing on these shores to St Helena or any other overseas territory? Is it, as a former Home Secretary told me recently, because after five years they would acquire rights to British citizenship?
Stephen Doughty
We are absolutely confident that this agreement is compliant with international law, and we will be working closely with the Attorney General of St Helena to ensure that it is compliant with our law, with St Helena law and with all our international obligations.
Chris Murray (Edinburgh East and Musselburgh) (Lab)
Does the Minister agree that the Government inherited a deeply troubling and complex situation for any migrants involved that the last Government failed to resolve over a number of years, and that we have now taken the decisive action needed to find a solution to this problem?
Stephen Doughty
My hon. Friend is absolutely right. As I have set out, we inherited a mess, quite frankly, on some of these issues and we are taking the pragmatic, practical steps to ensure that we have agreements that meet the needs going forward.
Sir Julian Lewis (New Forest East) (Con)
I accept what the Minister says—that there have been no immigration arrivals since 2022—but does he accept in turn that there is a danger of creating a pull factor? If that happens, and a much larger number arrive than expected, will he put a cap on the number that can be transferred to St Helena?
Stephen Doughty
That is exactly why we have concluded these agreements with Mauritius and St Helena. BIOT is not a suitable place for migrants to be present; there is no permanent population and there are no suitable facilities. We are taking these steps to close down that route and ensure that people do not make that dangerous journey.
Mr Luke Charters (York Outer) (Lab)
Can the Minister confirm that British sovereignty over the overseas territories is non-negotiable, and that the comments from Conservative Members are not only wrong but deeply irresponsible?
Stephen Doughty
My hon. Friend makes an important point. I have repeatedly made it clear, not least in the Falklands and Gibraltar, that we stand by their sovereignty and self-determination and will defend them. Indeed, that goes for the British overseas territories family, and it is a commitment that I will be making in person when the leaders join me at the Joint Ministerial Council in a few weeks’ time.
Dr Andrew Murrison (South West Wiltshire) (Con)
Since no migrants have arrived in BIOT since 2022, and given that this agreement lapses after 18 months, what is the problem that the Minister is trying to solve? And given that Rwanda was apparently considered immoral and this is not, is he not simply offering an insult to Kigali?
Stephen Doughty
Absolutely not. This is prudent contingency planning. Unfortunately, we inherited a situation from the previous Government where many holes had been left in these very arrangements and where there were significant problems. We are now taking steps to pragmatically address that.
Jonathan Davies (Mid Derbyshire) (Lab)
I welcome the Government’s commitment to St Helena. Does the Minister agree that the comparisons with the Rwanda scheme that have been made throughout this urgent question are irresponsible and unhelpful, given that it cost £700 million and sent only four volunteers?
Stephen Doughty
My hon. Friend is absolutely right. There is no comparison with the £700 million of taxpayers’ money that was spent on four volunteers, as the Home Secretary just set out. This is a sensible, win-win, beneficial agreement that benefits both the United Kingdom and St Helena and involves potentially very few people.
Jeremy Corbyn (Islington North) (Ind)
Can the Minister explain why the applications for refugee status made by people who have come to the British Indian Ocean Territory, as it is currently called, cannot be processed now? Why is he instead taking them to St Helena? Will he guarantee that St Helena is not going to become an offshore base for Britain to evade its international human rights obligations by simply sending large numbers of refugees there in the future?
Stephen Doughty
I do not agree with the right hon. Gentleman’s characterisation of St Helena. It is a wonderful place with wonderful people, and its Government have voluntarily entered this agreement. It is obviously a much more suitable place, were people theoretically to arrive, than BIOT, which is not suitable. I am very confident that all our processes comply with international law.
Sir Desmond Swayne (New Forest West) (Con)
The opportunities available to any migrant are vastly greater in Rwanda, aren’t they?
The Minister for Border Security and Asylum (Dame Angela Eagle)
Why didn’t they go there, then?
Stephen Doughty
As my hon. Friend says, why didn’t they go there? I mean, four people for £700 million is an absurd comparison. We are taking pragmatic steps to address the situation we inherited from the previous Government, and there is no comparison to be made between the situation in Rwanda and the situation in St Helena.
Lee Anderson (Ashfield) (Reform)
If illegal migrants arriving in St Helena are granted asylum, does that mean they can then apply to come to the UK? If so, does that not create another market for people smugglers?
Stephen Doughty
No, absolutely not. There is no automatic right for them to travel from St Helena to the UK. St Helena will undertake the processing of any cases in a proper way. Of course, anyone who fails to get a positive decision will be removed. St Helena will process them, but there is no automatic right to come to the UK. As with any overseas territory, people will be able to apply for British overseas territory citizenship after a period of time, but it is not automatic.
Sir Geoffrey Clifton-Brown (North Cotswolds) (Con)
The Minister has repeated several times this afternoon that no migrants have gone to BIOT in the last two years. He studiously avoided answering my right hon. Friend, the shadow Foreign Secretary’s important question about how many migrants he is providing contingency for. In order to calculate the £6.5 million, he must know how many migrants are likely to go to St Helena—or not, as the case may be. Will he now tell the House what that number is, and will he publish the full impact assessment?
Stephen Doughty
Like most people, I do not have a crystal ball. Our expectation, based on the evidence, is that hopefully nobody will make that journey because it is dangerous and BIOT is not a suitable place for migrants. However, it is only right that we put contingency arrangements in place were anyone to do so before any treaty is concluded with Mauritius, which will then take responsibility for dealing with any migrant arrivals. The £6.65 million figure is for health and education. As part of the agreement with St Helena, any support for additional costs, were anyone to arrive, would be negotiated on a case-by-case basis.
James Wild (North West Norfolk) (Con)
The Minister says this deal will cost taxpayers £6.65 million. Will he now be transparent and tell the House how much UK taxpayers will pay to Mauritius so that we can continue to use Diego Garcia, which he gave away?
Stephen Doughty
The facts relating to the agreement with Mauritius will be set out in due course, following proper parliamentary scrutiny. This is very specifically about the agreement with St Helena, and I have set out the amount of money and what it will be used for.
Jim Shannon (Strangford) (DUP)
Will the Minister outline how the airbase’s security will be best served within this new management, considering the importance of vetting anyone seeking to enter a military base under regular circumstances, never mind in this situation? What assurance do military personnel have that their safety is important to this Government?
Stephen Doughty
I think the hon. Gentleman may be referring to Diego Garcia, which is obviously not a suitable place for migrants, for the reasons he sets out. We have ensured that we put the base on a secure, long-term footing, in the interests of the national security of the UK and our allies.
Mr Speaker
That concludes the urgent question. As the House can see on the Order Paper, there are many Bills to be presented today. In order to save time and get on with today’s main business, for Members presenting more than one consecutive Bill, I will accept private notice of the Second Reading dates for those Bills. Those dates will be recorded and published accordingly in Hansard and in the Votes and Proceedings. For Members presenting individual Bills, they will name the date for Second Reading as usual.
Bills Presented
Employment Rights Bill
Monday 21st October 2024
(2 months ago)
Commons ChamberRead Full debate Employment Rights Bill 2024-26 View all Employment Rights Bill 2024-26 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts
21:59 - The House divided: - Ayes: 105 / Noes: 386 - Question accordingly negatived.
22:15 - The House divided: - Ayes: 386 / Noes: 105 - Question accordingly agreed to.
Mr Speaker
The reasoned amendment in the name of Kevin Hollinrake has been selected.
The Deputy Prime Minister (Angela Rayner)
I beg to move, That the Bill be now read a Second time.
I declare that I am a lifelong proud trade union member—[Hon. Members: “Hear, hear.] When the Government took office and I took this job, we promised the biggest upgrade to workers’ rights in a generation, nothing less than a new deal for working people. We said that we would introduce a Bill to deliver that within 100 days, and we have fulfilled the promise we made to the British public. Let us be clear: too many working people have had to wait too long for change.
Over decades, the good, secure jobs that our parents and grandparents could build a life on were replaced by low-paid and insecure work. Wages flatlined, in-work poverty grew, growth was strangled and the Tories left behind a battered economy that served no one. Today, this Labour Government, led by working people for working people, will start to turn the tide.
First, I want to note the reasoned amendment. Our reforms are ambitious—they have to be to bring real change. But we have engaged extensively and will continue to do so. Today we are publishing a package of consultations on strengthening statutory sick pay, zero-hours contracts, industrial relations, collective redundancy and fire and rehire. As the impact assessment we have published today shows, the Bill is a pro-growth Bill.
This landmark Bill—pro-growth, pro-business and pro-worker—will extend the employment protections given by the best British companies to millions more workers.
James Wild (North West Norfolk) (Con)
In a discourtesy to the House, the very extensive impact assessment to which the Deputy Prime Minister has referred was published only a couple of hours before the debate, but one thing that it says is that the estimated cost of the measures could be £4.5 billion a year. How does loading costs on to employers help to boost growth and job creation?
Angela Rayner
The impact assessment also makes it clear that the Bill will have a positive impact on growth. More than 10 million workers, in every corner of this country, will benefit from Labour’s plan, and the money in their pockets will go back into the economy and support businesses, in particular those on high streets.
Across the business spectrum, from giants like Sainsbury’s and Octopus Energy to small and medium-sized companies like Richer Sounds, successful firms already know that strong employee rights mean strong growth opportunities. The Secretary of State for Business and Trade and I have just been to the Co-op in County Durham to see how it retains valuable talent, boosts profits, and powers ahead with enlightened policies that support good working lives for its staff. The Bill will bring all businesses on board.
Graham Stuart (Beverley and Holderness) (Con)
The Government’s own impact assessment states that
“the impact on growth could”—
only could—
“be positive”,
and that any such impact
“would be small in magnitude.”
The negative impacts, not least on small businesses, will be very serious in magnitude, as my hon. Friend the Member for North West Norfolk (James Wild) laid out. Will the Deputy Prime Minister please explain how she will minimise the negative impacts?
Angela Rayner
We have already been working with businesses while bringing forward the Bill, and we will continue to do that through the consultations. We have recognised probation periods, for example, but we do not think that people should not have rights two years into their employment.
We are listening, but I say to Conservative Members, who promised employment Bill after employment Bill and then never delivered them, that the people of this country deserve secure fairness at work, and this Labour Government will deliver it. Almost 9 million employees will benefit from protection against unfair dismissal from day one, 1.7 million will benefit from new policies on flexible working, and up to 2 million will receive a right to bereavement leave. Thousands of pregnant women and mothers will benefit from new maternity protections, and tens of thousands of fathers and partners will be brought into the scope of paternity leave. We will deliver a genuine living wage that matches the cost of living.
In total, more than 10 million people will benefit from Labour’s plan in every corner of this country, so if you are in casual work, unable to rely on guaranteed hours, this Labour Government are delivering for you. If you are working hard on low pay and struggling to make ends meet, this Government are delivering for you. This is a Government back in the service of working people.
Dr Luke Evans (Hinckley and Bosworth) (Con)
Can the Deputy Prime Minister define “working people”?
Angela Rayner
The Conservatives had 14 years to support the working people of this—[Interruption.]
Angela Rayner
Will the hon. Member listen to my response? I gave way to him. For 14 years, the Tories promised employment Bills and an industrial strategy, and in 14 years they delivered the highest cost of living for the working people of this country. It will be this Labour Government who deliver for them.
This is a Government back in the service of working people, building an economy fit for the future and making work pay. For the first time ever, we have instructed the Low Pay Commission to take account of the cost of living when setting the minimum wage, because everyone deserves a proper living wage for a proper day’s work. We have already moved to protect 4 million self-employed workers from late payments with the new fair payment code, and we have already encouraged employers not to use the ineffective and failed minimum service laws, which did not stop a single day of industrial action while in force, before we repeal them for good. That is a bold start, but we are going further. The UK labour market is not delivering for workers or businesses, and it holds back the UK economy. We know that things have to change. The Bill marks a momentous opportunity to chart a new route to growth—one built from the bottom up and the middle out—alongside the £63 billion of investment into the UK that was announced last week. Higher growth, higher wages and higher productivity—a new partnership between workers and business.
Graham Stuart
I believe it is. The Deputy Prime Minister just talked about the amount of money coming into the economy as a result of the measures. Is it appropriate for her and other Members across the House to speak in the debate without mentioning what they have received in donations from trade unions, given how central the law around trade unions is to the Bill?
Mr Speaker
You are correct: it is not a point of order, even if the right hon. Gentleman thought that it was.
Wera Hobhouse
Sexual harassment in the workplace is absolutely horrendous and has been terrible in demotivating people from staying in their workplaces. Following my Worker Protection Act 2024 becoming law, the Government proposals go even further on third-party harassment in the workplace. Does the Deputy Prime Minister agree that the Bill will encourage people by making our workplaces safer?
Angela Rayner
I agree with the hon. Member and thank her for her work in that area. We must ensure that workplaces have a good culture that does not tolerate any form of harassment, including sexual harassment, because that is bad for business as well.
The major achievement of parts 1 and 2 of the Bill will be to strengthen rights for working people. That is personal for me: I started my working life as a carer on casual terms, not knowing if there would be a pay cheque next month. The fear of not being able to provide for my young family, and of losing everything, stuck with me. Now that I am at the Cabinet table, I am determined to deliver for the millions of people in the position that I was once in, and to bring all companies up to the standard of the best when it comes to workers’ rights. The Bill is a recognition and celebration of the many employers that are already implementing such measures and, in many cases, go much further.
Rosie Wrighting (Kettering) (Lab)
I welcome the new Labour Government’s approach to ensuring that my constituents feel the benefit of economic growth. As my right hon. Friend will know, more than 1 million people on zero-hours contracts will benefit from her guaranteed hours policy. Does she agree that the Bill will raise living standards across the country?
Angela Rayner
I agree, and can confirm to the House that the Bill will finally end the exploitative zero-hours contract. Up to 2.4 million workers will finally have the right to a contract that reflects the number of hours that they work.
For too long, working people have been subject to the shocking practice of fire and rehire. Often, even the threat of fire and rehire means that people voluntarily agree to lower pay and reduced terms and conditions. Our Bill will end those bullying tactics for good, putting an end to fire and rehire and to fire and replace, unless employers can prove that they face financial difficulties that threaten the survival of their business and that changing the employee’s contract was unavoidable. After years of campaigning, working people finally have a Government who listen. No longer will working people face the scourge of fire and rehire.
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
A number of our constituents were threatened with fire and rehire during the covid pandemic—shameful acts by their employers. People were fearing for their livelihoods while that crisis was going on. Does my right hon. Friend agree that we have waited far too long and cannot end the scourge of fire and rehire soon enough in order to give workers the protection that they need and deserve?
Angela Rayner
I agree with my hon. Friend. The previous Government promised to do something about the practice but failed to do anything.
Dr Andrew Murrison (South West Wiltshire) (Con)
Does the Deputy Prime Minister agree that growth, if it comes, will come from small and medium-sized enterprises, which are the bedrock of industry in this country? Does she accept that although the measures may be capable of being accommodated by large businesses with big human resources departments, they certainly will not be by small and medium-sized enterprises, so the Bill is likely to damage the growth that she insists will come under a Labour Government?
Angela Rayner
I agree with the right hon. Gentleman on the importance of small and medium-sized businesses, which do a fantastic job and contribute widely to our economy. That is why we have engaged with small and medium-sized enterprises. Many of them understand that if there is clarity around what we are doing and if we consult like we did with probation periods, then we are working with them. But many of them also recognise that the scourge of insecure, low-paid work in this country at the moment is holding Britain’s economy back. That is what we are going to change.
Paul Waugh (Rochdale) (Lab/Co-op)
The Deputy Prime Minister referenced the extra help for working parents that the Bill will introduce. Does she agree that that stands in stark contrast to the suggestion of some on the Conservative Benches that maternity pay has “gone too far”?
Angela Rayner
I agree with my hon. Friend. When the previous Labour Government brought in the national minimum wage they had the same sort of arguments made at them, but what we actually saw was that the minimum wage lifted millions of people out of poverty. It will be this Labour Government who can stand proudly and say that we stood up for the workers, and for those good employers in our country that are doing the right thing by protecting and looking after their employees.
David Baines (St Helens North) (Lab)
We are clearly going to hear a lot of the same arguments that we heard years ago, when Labour introduced the minimum wage. Does the Deputy Prime Minister agree that good employers have nothing to fear from the Bill, and working people have a lot to celebrate?
Angela Rayner
I agree with my hon. Friend. The Bill is pro-worker and pro-business; that is the context in which the Bill has come to fruition. We have been consulting wide and long on the measures, and we believe they strike the right balance to get our economy working across the board, so that people can contribute and feel that their contribution is valued as part of the UK economy.
The Bill also delivers a once-in-a-generation upgrade of the rights of our proud seafarers. Never again will any company be able to get away scot-free with exploiting a loophole to sack employees without notice. No longer will our seas be the byword for a race to the bottom on standards.
The next step in our package to transform the rights of working people is on unfair dismissal. At present, employees must wait two years for basic protections against unfair dismissal, so it is not surprising that they can be loath to change jobs and restart the clock. That is not right. It deprives people of promotion opportunities and pay rises, and it limits businesses’ ability to recruit. Under the Bill, employees will not have to wait years for protection from unfair dismissal. Instead, they will receive it from day one. Those measures alone will benefit close to 9 million people.
Saqib Bhatti (Meriden and Solihull East) (Con)
The Deputy Prime Minister talks about seafarers not being abused, but did she apologise to DP World last week?
Angela Rayner
I do not know what the hon. Member is getting at. Maybe he is getting at the former Conservative Transport Secretary, who referred to them as pirates of the high seas or weasels—I do not know. I have just said clearly to all businesses in the UK that I want to work with them to ensure that we value their employees. Many of them are onboard: they recognise that it is good for business, good for growth and good for their employees.
Kit Malthouse (North West Hampshire) (Con)
I draw attention to my entry in the Register of Members’ Financial Interests.
In relation to the point raised by my right hon. Friend the Member for South West Wiltshire (Dr Murrison), I understand that the right hon. Lady believes she is fulfilling a manifesto commitment, and we have to respect that. However, I hope she recognises that while these regulations will apply across the whole of the economy, the dynamics within small businesses and—in particular—microbusinesses are very different from those within large businesses. For example, if a business only has four employees and all four apply for flexible working, as the Bill provides for, it becomes not just a logistical and administrative nightmare but a personal nightmare for the person who is trying to run that business. I hope that as the Bill progresses, the right hon. Lady will look at what has been a customary carve-out for small businesses and consider whether that might be appropriate for specific measures.
Angela Rayner
Some of the measures in the Bill do recognise the difference between large employers and smaller ones, but we also have to ensure fairness and clarity of purpose in this country, and I think this Bill strikes the right balance. As I have said to other hon. Members who have raised issues regarding small and medium businesses, we are working with those businesses. We have already listened regarding probation periods: the Bill now creates a new statutory probation period so that employers and employees can check whether a job is a good fit. If it turns out not to be right, the Bill allows for a new lighter-touch standard of fairness for employers to meet when they dismiss someone, so I think we are striking the right balance. We have worked very hard on this piece of legislation. If workers are dismissed unfairly, everyone deserves the right to protection, however long they have been in post. With Labour, they will have that right.
Turning to statutory sick pay, no one should feel forced to struggle through work when they are not well. Our view is simple: everyone should be entitled to sick pay from the first day that they are sick, regardless of their earnings, yet 1.3 million employees are currently excluded because they do not earn enough. That means that lower earners, including carers, go to work when ill because they cannot afford not to do so, risking infecting the vulnerable, the elderly, and others with whom they come into contact. No one should want that. Under this Bill, all employees will be entitled to sick pay however much they earn, and that sick pay will be paid from their first day of being ill.
Angela Rayner
I have already given way to the right hon. Member, and there are so many other Members who want to speak.
This Government know that the current system does not support working families. We said that we would make flexible working the default, and the Bill will do just that. Flexible working makes workers happier, and we know that businesses that offer it benefit from bigger, better and more diverse recruitment pools. At the same time, we recognise that not all workplaces can accommodate all flexible working requests, so businesses will be able to negotiate or reject unworkable requests as long as that rejection is reasonable.
Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)
Who would decide whether a rejection is reasonable or unreasonable?
Angela Rayner
There will be statutory guidance, but of course, it would depend on the various different circumstances. We saw during the covid pandemic that people were able to be incredibly flexible in their work. It is with that mindset that I ask employees and employers to look at how they deliver services, because far too much talent goes out of our economy because of inflexibility. Employers should think about how much talent they can retain in their business by keeping people in work; many of the good employers already know that, and offer way more flexibility than we are suggesting in our Bill.
The current parental leave system is also outdated, which is not right. Under the Bill, fathers and partners will be able to give notice of their intention to take paternity leave and unpaid parental leave from their first day in a new job. New mums also lack the protection they deserve. We know that the Conservative party’s solution is to go back to the dark ages and scrap maternity pay altogether; if the Conservatives had their way, as a single mum, I would have been left with nothing. It was a Labour Government who introduced the maternity allowance as the number of mothers in the workforce grew, and while the Conservative party—out of step with modern Britain—cannot wait to get rid of it, I say that we will never, ever stop defending it.
Rachael Maskell (York Central) (Lab/Co-op)
I am grateful to my right hon. Friend for giving way—what an incredible legacy she is setting down today!
Adoptive parents clearly need time with their children as they bring them into their family, but self-employed adopters do not have the same privileges. Will my right hon. Friend look at how we can ensure that those parents also have proper statutory rights to take leave and receive pay?
Angela Rayner
I thank my hon. Friend for making that really important point. This is the start of a process. There are a number of consultations, such as for the self-employed and on a single category of worker, and they will continue, because some of these things are more complex than what we can deliver in this Bill. But I say to my hon. Friend and to other Members: please come to this in the spirit of what we want, which is to improve working people’s lives. As I have said, many employers already go above and beyond what we are saying in this Bill. I hope we can start to celebrate those employers who do so and to spread that across the economy.
Ms Stella Creasy (Walthamstow) (Lab/Co-op)
May I join others in celebrating this Bill and what it represents? My right hon. Friend talks about employers who are already going above and beyond. Frankly, they get it that, out there in the real world, supporting families is good for the economy and good for growth; that includes dads, who we all recognise have responsibilities. What more can she tell us about that spirit of openness in the Bill and the opportunities to look at parental leave, particularly paternity leave? What more can we do to help more families to take it up and get longer?
Angela Rayner
I thank my hon. Friend for making that important point. We all agree across the House that families play an important role, that businesses can help to support families, whatever size or shape they are, and that we must go much further to make that happen.
The Bill goes further by making it unlawful to dismiss pregnant women, mothers on maternity leave and mothers who return to work during a six-month period after they return, except in certain specific circumstances. For women in work, we will not stop there. Eight out of 10 menopausal women are in work. For most, there is no support. When workplaces fail to support women, we fail in our moral duty to treat people equally, and employers lose out on talent and skills. On pay, too, we are failing women. The national gender pay gap still stands at over 14% and is not narrowing fast enough, so we will be requiring action plans for large employers to address the pay gap and support women during the menopause.
It is a sad reality that women often find the workplace uncomfortable and unsafe. Sexual harassment at work can destroy confidence and ruin careers. We will do everything in our power to tackle it. The Bill will strengthen the duty on employers to prevent sexual harassment of employees, and it will strengthen protections for whistleblowers by making it explicit that if they do the right thing and speak up about sexual harassment, the law will protect them.
Through this Bill, the party of maternity pay and of the Equal Pay Act 1970 will introduce the next generation of rights for working women. Central to all these reforms is our belief that all employers should always support their employees. The best ones already do.
Steve Witherden (Montgomeryshire and Glyndŵr) (Lab)
In early September, over 500 Oscar Mayer workers, organised by Unite the Union, launched strikes against the company’s appalling use of fire and rehire. Many of these workers are my constituents and are facing serious threats to their pay and working conditions, with potential losses of up to £3,000 annually. I hugely support this legislation, but immediate action is crucial to protect my constituents and workers across the UK from such exploitative practices. Will my right hon. Friend provide clarity on the timescales for reforms to unfair dismissal?
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. Before the Deputy Prime Minister responds, may I say that if there are declarations of interest to be made, even in interventions, they should be made on the Floor of the House?
Angela Rayner
I thank my hon. Friend for his intervention. That is why we have moved at pace. The previous Government promised an employment Bill to protect workers and they did not deliver. Within our first 100 days, we are delivering this employment Bill.
Losing a loved one is among the hardest things for any of us. That is why in this Bill we are setting a clear standard for businesses, giving employees the right to bereavement leave. Taken together, these new rights for working people—sick pay when they need it, an end to exploitative zero-hours contracts and to fire and rehire, bereavement leave, expanded entitlements, paternity leave and new protections for women in work—represent the biggest upgrade for working people in a generation, but we are not stopping there.
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
Does my right hon. Friend agree that the Bill not only represents the biggest uplift in workers’ rights in a generation, but strengthens their enforcement through new enforcement measures? That stands in stark contrast to the Conservatives, who brought in unlawful employment tribunal fees.
Angela Rayner
My hon. Friend makes a very important point. We want the culture to change as well. We have had a race to the bottom where workers have not been protected, and we have seen the biggest wave of strike action because of the previous Government.
We want employers and trade unions to come together to grow our economy. The employers and the unions are up for that challenge, because we know that the world of work is fairer and more productive when working people can come together to negotiate fair pay and decent conditions. That is why we are reinstating the school support staff negotiating body in recognition of the vital role that support staff play in the workforce and in young people’s education.
As a former carer, I have said from day one that in this place I will champion carers and the complex, high-quality and professional work that they do. I am so proud to say that after 14 years, their extraordinary, life-saving contribution to our community will no longer be devalued by low pay and lack of career progression. For the first time, thanks to this Labour Government, there will be a historic fair pay agreement process in the adult social care sector, with a new body empowered to negotiate pay and conditions and ensure that training and a career structure are in place. At last, care will be rightly regarded as a multi-skilled profession and carers will be confident that they have the respect and income that they deserve for looking after our vulnerable loved ones and helping to manage the pressures on the NHS and in social care.
Paula Barker (Liverpool Wavertree) (Lab)
I draw the House’s attention to my entry in the Register of Members’ Financial Interests. Does my right hon. Friend agree that care workers are often the Cinderella service? They are low paid, but certainly not low skilled. It is time we got to grips with hostile employers who do not pay travel time.
Angela Rayner
My hon. Friend makes a very important point. The disparity in the terms and conditions for care workers actually impedes recruitment: we are seeing huge numbers of vacancies in the care sector. Through the fair pay agreement, I want to see carers being treated with fairness for the valuable contribution they make. They are also key to tackling the challenges we face in our NHS.
Alison Bennett (Mid Sussex) (LD)
I thank the right hon. Lady for raising the issue of care workers and the great contribution that they make by looking after those who need care. Does she agree that the minimum wage for a carer should be increased by £2 an hour, in line with Liberal Democrat policy?
Angela Rayner
We have already written to the Low Pay Commission, as I have set out, and we want to go further through the fair pay agreement to make sure that carers are recognised for the valuable role they play. Care workers are not just people who do the shopping or call in for 15 minutes; they handle complex needs in the community and look after some of our most vulnerable loved ones. They should get the recognition they deserve, and that is why we are taking these measures.
We know the valuable contribution that trade unions make. That is why we are resetting industrial relations. The Conservatives presided over strike Britain with their scorched earth approach to strikes. First, we are repealing the Strikes (Minimum Service Levels) Act 2023. Anyone with a brain could see that that legislation would do two things: increase tensions and fail to prevent a single day of industrial action. We said so at the time, and what happened? The rail dispute cost our economy over £1 billion. The law has failed and has no reason to stay on the statute book.
We are also repealing nearly every part of the flawed Trade Union Act 2016, which tried to smother trade unions in form filling and red tape and prevent them from doing their job. We will go further by strengthening the voice of working people by making it easier for trade unions to get recognised, giving them the right of access to workplaces and making sure that they have enough time to represent their members. When the rights of working people are flouted, a new fair work agency will be empowered to investigate. Today we are also launching a consultation on modernising trade union laws so that they are fit for the modern workplace and our modern economy.
In under 100 days, we have put together a transformative package that marks a new era for working people. We know that the Conservatives will oppose this every step of the way. We know because they have history, just as they opposed Labour’s minimum wage and now, shamefully, want to take us back to the dark ages when women were denied maternity pay. It is clear that they are out of step with modern Britain.
Our plans mark a new way forward—a new deal for working people, making jobs more secure and family friendly, banning exploitative zero-hours contracts, supporting women in work at every stage in their life, a genuine living wage and sick pay for the lowest earners, further and faster action to close the gender pay gap, ensuring that rights are enforced and that trade unions are strengthened, repealing the anti-worker, anti-union laws, turning the page on industrial relations and ending fire and rehire, while giving working people the basic rights that they deserve from day one in the job. This is a landmark moment, delivered in under 100 days. This is a pro-business, pro-worker, pro-growth Bill and a pro-business, pro-worker, pro-growth Government. Today, after 14 years of failure, we are starting a new chapter and decisively delivering a better Britain for working people.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the shadow Secretary of State.
Kevin Hollinrake (Thirsk and Malton) (Con)
I beg to move an amendment, to leave out from “That” to the end of the Question and add:
“this House notes the balanced reforms made by previous Conservative governments to improve workers’ rights, including the National Living Wage, the prohibition of the use of exclusivity clauses or terms in zero hours contracts and the introduction of shared parental leave and pay, and declines to give a Second Reading to the Employment Rights Bill because it has been rushed into Parliament without full consultation to meet an arbitrary 100-day deadline and Monday 21 October 2024 Business Today: Chamber 19 has not been accompanied by an Impact Assessment considering the impact on the Employment Tribunal, especially as a result of the removal of the qualifying period for the right to claim unfair dismissal or the impact of the extra red tape on SMEs or the impact of establishing the Fair Work Agency; because the repeal of trade union laws will lead to more strikes and intimidation in the workplace, and will force taxpayers to foot the bill for inflation-busting pay hikes without public service reform; because the Bill undermines choice for workers about whether they want to fund political campaigning and forces firms and public bodies to bankroll more trade union facility time, including trade union diversity jobs; and because the Bill is contrary to the Government’s stated goals of improving productivity and economic growth and will increase costs for businesses and consumers.”
The Conservative party will always be the party of business, but we are pro-business and pro-worker, not least because many Conservative Members have been both workers and people who have started and grown their own businesses. Those who have done so are the first to appreciate the symbiotic relationship between the two. We acted during our time in office to improve workers’ rights in several areas: flexible working, parental leave, redundancy protections, ensuring that workers keep the tips left for them by their customers, and significant increases to the national living wage.
I started my first significant business back in 1992. Over three decades, we grew to become a national business employing hundreds of people. We valued every one of those people. We were one of The Sunday Times’s best 100 companies to work for and were certified by Investors in People. I believe that business is a force for good and that businesspeople do great service to our communities and the wider economy. As Winston Churchill put it, they are the strong horse that pulls the whole cart.
The question I now ask myself is whether I would start that small business again today if the Bill were in place. Sadly, the answer is probably no—certainly not a business that employed any people. The very high cost of these measures will be borne by all companies and passed on in the form of higher prices, reduced wages and lost jobs. The measures will fall most heavily on small businesses, for which they could be existential.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
Does the hon. Member remember 1997 and 1998, when the Conservative party said that the social chapter and the national minimum wage would cost half a million jobs? In the late 1990s, half a million jobs were actually created.
Kevin Hollinrake
I was not here at the time, but it is clear nevertheless that the minimum wage and the national living wage have had a positive effect on prosperity in this country, and I would be the first to admit it. I want the hon. Lady, and other Government Members, to understand that those measures fell equally on all businesses across the UK. The measures in this Bill fall disproportionately hard on small businesses.
What the right hon. Member for Ashton-under-Lyne (Angela Rayner) fails to understand is that the implication of these measures, such as a day one right to an employment tribunal, is that even a spurious case of unfair dismissal costs time and money. It is potentially tens of thousands of pounds to defend that case. As one business organisation put it, “You lose when you are accused.” Most small businesses saddled with such a cost would be sunk without trace. It is not just that, but the deterrent effect, which it would have had on me, and which will be felt right across the economy and by every existing and aspirant business person across this entire nation. When the Deputy Prime Minister reflects on what she is hearing from people who have actually run a business, will she at the very least consider exempting small and medium enterprises from this catastrophic Bill?
Graham Stuart
Like my hon. Friend, I started a business—I started mine a little earlier than him, but that is how much older I am. I followed the Deputy Prime Minister’s speech as carefully as I could. From what I could understand, because of the changes in the Bill, someone can fail to turn up to work on day one claiming that they are sick and then, because they will now have rights against unfair dismissal, they will be able, without ever doing a day’s work, to hold a small business to ransom and put that business at risk.
Kevin Hollinrake
As drafted, that is certainly the case. My right hon. Friend is absolutely right. Members may not know that small businesses stand the cost of statutory sick pay. It is not reimbursed by the Government, so the Bill would have a significant cost for businesses.
Several hon. Members rose—
Richard Burgon (Leeds East) (Ind)
I have listened with interest to what the shadow Minister is saying about people being entitled to go all the way to an employment tribunal hearing from the moment they take up employment. Has he ever heard of pre-hearing reviews for employment tribunals?
Kevin Hollinrake
The point I was making is that the case may go all the way to an employment tribunal, as the hon. Gentleman knows, but there would also be the cost of defending the case even if it does not. That small business will have to bring consultants in and will have to speak to lawyers. That itself costs money, and in many cases that will be thousands of pounds. That is what the hon. Member fails to understand: when you are accused, you lose.
Several hon. Members rose—
Kevin Hollinrake
No, I will make a little progress. The cost of all these measures—in individual opportunities and to the wider economy—is huge. The Government may try to deny that, despite their clear lack of experience of the real world of business. It is extremely alarming that not one of those on the Front Bench today have ever started or run a business that employed anyone. Even worse than that, only one member of the Cabinet has ever done so, and that is the Secretary of State for Scotland.
Shamefully, given what is at stake, the Government cannot deny our case that the Bill will have a huge economic cost, because today—finally, two hours before this debate—they have actually produced the impact assessments. The cost of the Bill is on the very first page: up to £5 billion per annum. The word “uncertain” appears 302 times in those impact assessments, and the word “risk” is used 432 times, so the cost is likely to be much more.
Paula Barker
The shadow Minister has just said that shamefully there is only one person on our Front Bench who has run a business. How many of his Front-Bench team are trade union members?
Kevin Hollinrake
I am not a trade union member, and I would not know about my colleagues, but I started a business, as did my hon. Friend the Member for South Suffolk (James Cartlidge), as did the shadow Chancellor and as did many others in our party. We are proud of that fact.
This morning I met business representatives covering all parts of the British economy. Like us, they have serious reservations about this Bill. The Institute of Directors highlighted the fact that 57% of its members will be less likely to hire staff, with only 2% saying that would be more likely. The Confederation of British Industry said that the costs associated with this Bill cannot be afforded by 54% of businesses.
Jim Shannon (Strangford) (DUP)
This legislation applies to England and not Northern Ireland, but I echo the hon. Gentleman’s concerns. I am concerned about small and medium businesses that employ a small workforce. If one or two of them have a long-term illness, they may be off for a while, come back to work and then go off for a while. Is there not a need—I look to the Deputy Prime Minister—for a methodology whereby small businesses can employ someone in the short term for those positions, otherwise they will go to the wall?
Kevin Hollinrake
I agree. I was interested that the Deputy Prime Minister said that her menopause measures would be exclusive to large businesses. I welcome that, and I ask her to look at attaching the same conditions, ideally, to the entire Bill, but if not to certain parts of it. The risks for small businesses are simply catastrophic. Even one or two cases could completely sink a business.
Dr Luke Evans
When it comes to risk, is my hon. Friend concerned about the timing of this legislation if, as reported, the Budget raises national insurance for those businesses? Is that yet another risk in addition to this legislation?
Kevin Hollinrake
My hon. Friend is right. This morning we met representatives from UKHospitality, who said exactly that: the Bill is coming on the back of a number of changes and some difficult times during covid for industries that employ a lot of people, which will be particularly badly affected by this legislation. The Government should think twice about implementing it at this moment in time.
Sir Edward Leigh (Gainsborough) (Con)
My hon. Friend mentioned the 302 mentions of uncertainty. It is hard to know how that can foster growth. Let us be honest: businesses are already more highly taxed and regulated than ever before. We all know the reason—the pandemic— and we have to take responsibility for that. Will he assure me that, as a party, we will use this period of opposition to once again proclaim our values as a low-tax, deregulated economy? Otherwise, how will we foster growth in an increasingly competitive world? If we tax businesses more, we simply lay the foundation of a future Labour Government.
Kevin Hollinrake
I agree. We should be low tax and low regulation. One of the saving graces of this legislation is the detail, although the Bill itself is light on detail: many of the measures will be brought in through secondary legislation, therefore making it easier for a future Government to reverse some of the catastrophic changes.
Several hon. Members rose—
Kevin Hollinrake
I will make some progress. The Government’s own impact assessment acknowledges that the measures will mean price rises for consumers and job losses. In it, 40% of firms surveyed said that prices would go up, and 17% said that they will reduce the number of employees. That is hundreds of thousands of jobs at risk.
The criticism of the Bill does not stop there. The Institute for Fiscal Studies has warned that it risks lower employment rates and lower wages for employees. The Local Government Chronicle has warned that the Bill will place financial pressure on councils. The Recruitment and Employment Confederation has said that the Bill will fuel long and complex litigation. The Financial Times has warned that the Bill is causing deep unease among business leaders. In short, jobs down, wages down and prices up.
In their failed attempt to allays concerns about the Bill, the Deputy Prime Minister and the shadow Business Secretary have stated that they have consulted businesses—
The Secretary of State for Business and Trade (Jonathan Reynolds)
You are the shadow Business Secretary.
Kevin Hollinrake
Sorry, though I think the Prime Minister is guilty of similar; I do apologise. The Deputy Prime Minister and the Business Secretary have stated that they have consulted businesses. Really? The Federation of Small Businesses said not only that the Bill will
“inevitably deter small employers from taking on new people”,
but that it is a
“rushed job, clumsy, chaotic and poorly planned”
and that the Government are guilty of shallow engagement. So much for the “strong horse”. Several representatives at this morning’s meeting said that they have been talked to but not listened to—including those representing the hospitality and retails sectors some of the most labour-intensive in our economy, which is acknowledged in the impact assessment.
Kit Malthouse
Alongside the many negatives relating to the Bill that my hon. Friend has laid out, does he recognise the strong possibility that, particularly in small and micro businesses, the legislation could inject quite significant resentment among the staff body itself? For example, just to amplify my previous point, if you have six members of staff and three of them apply for flexible working, that has an immediate impact on those who do not have flexible working. The ability of the business to offer flexible working to future workers is also reduced, which turns the whole thing into a massive negotiation between six or seven people. That could have a significant impact on morale and sense of fair play within businesses themselves.
Kevin Hollinrake
My right hon. Friend is absolutely right. There speaks somebody who has actually run a business and understands the impact on a small employer. That is why we say there should be a carve-out, certainly for small and micro businesses.
We have to ask ourselves this: if the Government are not listening to businesses who “pull the whole cart”, who are they listening to? I think we all know the answer to that. A consultation is not five minutes inside No. 10 and a photo opportunity. Proper consultation is working with business, listening, taking your time and not rushing things—the exact opposite of what the Government have done. We know why that is. The Deputy Prime Minister made a misguided promise to Labour’s trade union paymasters that legislation would be introduced within 100 days. Despite 100 days of gloom and doom, talking the economy down and wrecking business confidence, they managed it—just.
The Government are not even listening to their own legal experts. Only last week the Attorney General said:
“excessive reliance on delegated powers, Henry VIII clauses, or skeleton legislation, upsets the proper balance between Parliament and the executive.”
Because the Bill is such a rushed job, it takes swathes of delegated powers, including Henry VIII powers, meaning the final policy will be decided later at the Secretary of State’s whim—not now by Parliament. Legislating that way is causing real concerns for businesses today. The Deputy Prime Minister and her colleagues preach stability, yet in the same breath they are causing instability, uncertainty and falling confidence at a cost of jobs and investment today. There are already 58,000 fewer payroll jobs than when Labour took office. Confidence levels at the Institute of Directors on future investment intentions have dropped from plus 30 in June to minus six today. The Government are planning 30 consultations on the measures in the Bill. They should have taken place before the Bill was introduced, so the legislation could be precise about what it will do.
Saqib Bhatti
I thank the shadow Secretary of State for giving way. He talks about trade unions. I have just seen a news update on the Unite union’s Birmingham hotel and conference centre being investigated by the Serious Fraud Office. The total cost was £112 million, but it has now been valued at £29 million. Who will hold the trade unions to account in the Bill?
Kevin Hollinrake
My hon. Friend makes a strong point. That certainly needs looking at very carefully.
As the Government’s attempt at business consultation has clearly failed, and as no one on their Front Bench has any business experience, I will draw the right hon. Lady a picture of what the Bill actually means for businesses.
Mr Richard Quigley (Isle of Wight West) (Lab)
As the owner of two successful small businesses—[Interruption.] I know Opposition Members like to do that—it’s pantomime—but they can listen. As the owner of two successful small businesses and an employer of 25 people in the hospitality sector, I welcome the Bill. Do Opposition Members agree that the main reason they are against this groundbreaking employment Bill is because they are embarrassed about their own record over the past 14 years?
Kevin Hollinrake
I welcome the fact that there is at least some business experience on the Government Benches. Perhaps the hon. Gentleman joined the wrong party.
The hon. Gentleman will recognise the picture of what the Bill means for businesses. They will be terrified to take new people on for fear of huge compliance costs and legal action. They will be tied up in red tape, something that the Prime Minister said he was taking an axe to. They will have to cope with measures such as the need to frequently recalculate all workers’ hours for each reference period for each separate employee, each of which will have a unique date as they will be required to proactively offer guaranteed hours. This is not even restricted to those on zero-hours contracts. It will be for anyone on low hours—a bureaucratic nightmare. They will have to deal with a new right to demand flexible working, such as a four-day week. The right hon. Member for Islington North (Jeremy Corbyn) must be proud. Businesses will have to become the free speech police to prevent any of their customers offending their staff. They will have to deal with a new regulator, the fair work agency, which will have the power to enter any business premises, confiscate documents and levy fines—all backed up by new criminal offences with penalties of up to two years in jail.
Emily Darlington (Milton Keynes Central) (Lab)
As someone who has started and run a business, I should like to know the hon. Gentleman’s opinion of the views of the former Business Secretary, the right hon. Member for North West Essex (Mrs Badenoch), that the minimum wage is a burden, that statutory maternity pay is excessive, and that equal pay protection in respect of race and disability is akin to segregation policies in South Africa—or does he want to distance his party from her comments?
Kevin Hollinrake
That is not what my right hon. Friend said at all. I worked with her when she was Business Secretary, and at no point did she ever say that about maternity pay. She was talking about regulation costs. She was simply pointing out that for many businesses, particularly in retail and hospitality, the rise in the national living wage has been very difficult to cope with. She was not talking about abolishing it. Businesses will have to deal with new union powers to gain access to any business premises and contact its staff—wonderful!—in order to recruit and organise members and make it much, much easier for a union to gain recognition. As the impact assessments state—this is great news; this will really cheer everyone up—there will be “increased industrial action” and tax rises to pay for increased pay demands. [Interruption.] That is what the Government’s impact assessments say. Labour Members should check their impact assessments. 1970s, here we come! There is much more, but in short, it all means that the tail will be wagging the dog.
Nigel Huddleston (Droitwich and Evesham) (Con)
I am sure that my hon. Friend will be aware of the history of Labour Governments since the second world war. Every single one of them has left office with employment higher than it was when they started. Is he concerned about the possibility that this Government will repeat the same mistakes, especially given their lack of business awareness and understanding of the private sector?
Kevin Hollinrake
I am very concerned about that. Today there are 4 million more jobs in our economy than there were in 2010, and 1.2 million fewer people are unemployed. I am very worried about the things that my hon. Friend is very worried about.
Making work pay is a laudable aim, but as one stakeholder put it this morning,
“work doesn’t pay if there’s no work”.
Most people recognise that one of the reasons why the UK is the third most popular destination in the world for inward investment, which creates hundreds of thousands of jobs throughout the economy, is the flexible labour market that the Government are now seeking to eliminate. Do the Deputy Prime Minister and her Cabinet colleagues realise that? Perhaps they secretly do, given that nine out of 10 of those Cabinet colleagues recruit on terms that are at odds with these new regulations. Sixteen Cabinet Ministers, including the Chancellor, the Foreign Secretary, the Home Secretary and the Energy Secretary, have hired people for roles that involve working outside regular hours and at weekends; six Cabinet Ministers have hired people to roles with extended probation periods; and seven Cabinet Ministers, including the Chief Secretary to the Treasury and the Deputy Prime Minister, have hired on “insecure” fixed-term contracts. Why would they introduce legislation that they do not understand or even comply with themselves? The answer is, of course, their union paymasters.
Much like the more than 200 Labour MPs who have taken trade union cash, the Deputy Prime Minister has her donations to think of. She declared her interests as a union member, but she did not declare her interests as someone who had taken £13,000 from unions in donations. The question of what is orderly is up to your judgment, Madam Deputy Speaker, but it seems to me that that should be declared at the start of any Member’s contribution.
This is not an Employment Rights Bill, but a trade union charter—a charter that will bring about no-knock warrants that allow unions to access all business premises, from the local takeaway to the local pub. Clearly, shutting the beer gardens is not enough for this Government; they are now relying on strike action to stop you getting a pint. Under this trade union charter, trade unions will revert to requiring people to opt out of donating to unions’ political funds. That will line Labour’s pockets with default donations from working people. This trade union charter will abolish the thresholds for strike action, unleashing waves of low-threshold strikes, and crippling public services by putting power in the hands of militant trade unions. This trade union charter will force employers to inform their staff that they can join a union at every turn. This trade union charter will reduce notice periods for strike action, meaning that businesses will be plagued by zero-warning strike action, which will unleash misery on the public at the last minute.
Tom Hayes (Bournemouth East) (Lab)
We have just had a general election. The Labour party won a historic majority on the basis of a manifesto that was pro-business, pro-worker and pro-growth. Through the Bill, we are bringing forward provisions that were sketched out in our manifesto. Why is the hon. Member choosing not to listen to the result of the election? In choosing to reject the provisions in the Bill, he is not learning from the result of the general election.
Kevin Hollinrake
We deserved to lose the election fair and square, but the hon. Gentleman should look at that result, because it was not a popular vote for Labour. The party’s popularity is dropping by the day, and the business confidence that we need to protect in this country is dropping by the day.
The Bill is a trade union charter. By repealing the Trade Union Act 2016, it will increase the number of strikes by 53%. It is a charter that will take Britain back to the 1970s—a stated goal of the Deputy Prime Minister. The public will pay the price not just through uncollected waste, dysfunctional local government and picket lines outside hospitals, as in the 1970s; they will be forced to pay through higher taxes—a fact that the Government have now admitted in the impact assessment, despite pledging not to increase taxes on working people.
At a time when the Government claim to be scrambling for cash and are taking the winter fuel payment from 9.5 million pensioners, they have the gall to drive up taxes to reward their trade union paymasters. That will be done not just through higher national insurance, a hike in fuel duty or whatever other punishing measures the Government choose, but through council tax. Because of the Government’s Corbyn-style collective bargaining for social care, councils will be required to stump up an additional £4.2 billion, or £150 per household.
The path that we took in government was pro-worker and pro-business. Whereas this Government put party first and country second, we worked in partnership with businesses and workers to deliver improvements without risking investment, unemployment and businesses going bust.
Sonia Kumar (Dudley) (Lab)
I just want to double-check: have you actually read the Bill? It talks about a consultation period with businesses, and the provisions will not be rolled out until 2026. There will be a probation period for certain businesses. We are pro-business, and maybe the shadow Minister should read the Bill properly.
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. We should not refer to other colleagues in the Chamber as “you”. It is quite simple.
Kevin Hollinrake
I wish the hon. Member for Dudley (Sonia Kumar) was with me for the hour I spent with the representatives of organisations this morning. They do not feel as she does—that there is nothing to see here and nothing to worry about. They are very concerned, and we should all be worried about that.
Through our approach, we doubled the minimum wage, boosted employment by 4 million, cut taxes on working people by £900, cut youth unemployment, slashed the employment rate and rolled out the biggest ever expansion of free childcare. Our approach recognised that by harming business, which is the strong horse that pulls the whole cart, we are harming workers—a fact that this Government have clearly failed to grasp. This Bill puts the cart firmly before the horse. For small businesses particularly, it creates an existential crisis of a magnitude not seen since the pandemic. The future of hundreds of thousands of business people and millions of jobs is in the Deputy Prime Minister’s hands. I urge her to think again, withdraw this legislation and listen carefully, not just to the unions but to the voice of business, before it is too late.
Several hon. Members rose—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. Over 80 Members wish to contribute. To try to accommodate most of them, I will limit Back-Bench speeches to three minutes and maiden speeches to five minutes. The first Back-Bench contribution is from Mike Amesbury, and I know that he will not want me to cut him off.
Mike Amesbury (Runcorn and Helsby) (Lab)
I stand here not only as the Labour MP for Runcorn and Helsby, but as a former trade union convener and shop steward for the wonderful trade union Unison. I am also a GMB member and a member of the Union of Shop, Distributive and Allied Workers. I am proud to have the opportunity to speak in this Parliament with a trade union voice, coming from a working-class background, and as part of a Labour Government. How fantastic is that? I also proudly refer the House to my entry in the Register of Members’ Financial Interests. Have a look: it is very clean money—trade union money.
This is an important day for the history of the labour movement and for industrial relations in this country. This Employment Rights Bill is pro-business, pro-worker and pro-growth. This is exactly the change that we were elected to make, just a few weeks ago. The Bill works in partnership with business and trade unions. It is not the work of fiction—I say this respectfully—that the shadow Minister described in his response to my right hon. Friend the Deputy Prime Minister. Labour Members are pro-jobs, but pro good jobs. We are pro-business, but pro good business. The Bill is also good for Britain. We want to turn the page on an economy that has been blighted by insecurity, poor productivity and low pay, and we want growth that leaves nobody behind in our communities.
I pay homage to the architects of this landmark legislation: the trade unions, of course; the former shadow Minister, my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald); my good friend the Deputy Prime Minister; and my neighbouring MP and good friend the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders). We were elected on a manifesto for change, and today that change begins—delivered within 100 days, as the Deputy Prime Minister said.
The Bill brings forward 31 employment reforms to help young and not-so-young workers alike. It marks the end of exploitative zero-hours contracts and fire and rehire practices, establishes day one rights to paternity, parental and bereavement leave for millions of workers, improves statutory sickness pay and collective bargaining, and provides for fair pay agreements. It means that 9 million people will have protection from unfair dismissal from day one, and that over 1 million people on zero-hours contracts will benefit from a guaranteed hours policy. This will help many in all our constituencies. An additional 1.5 million parents taking unpaid parental leave will be brought into scope of employment rights from day one. This Bill is a game changer. It is a manifesto commitment that I and everyone on the Labour Benches were proud to be elected on, and I look forward to our labour coming to fruition over the next few months and years.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson, Sarah Gibson.
Sarah Gibson (Chippenham) (LD)
Broadly speaking, the Liberal Democrats support the Government’s desire to modernise employment rights and make them fit for the modern working world. I hope the Government will appreciate our constructive scrutiny of the Bill today, to ensure that it is as helpful as it can be, for workers and small businesses. In the interests of transparency, I would like to mention that I have been a small business owner for most of my adult life, but I have also been an employee. I will start by outlining the improvements that the Government should make to better support carers, parents and those who fall ill. I will then move on to what adjustments must be made so that small businesses receive adequate support.
Members across this House will know that fixing our social care system and adequately supporting carers is a key issue for the Liberal Democrats. The Bill makes no clear statutory commitment to introducing paid carer’s leave. That omission strikes us as a missed opportunity for the Government to adequately support carers’ ability to juggle employment with their caring responsibilities. The Government’s “Next Steps to Make Work Pay” paper, which accompanies this Bill, commits to reviewing the implementation of paid carer’s leave. However, the Liberal Democrats believe that the Government should go a step further. We will be looking to strengthen the legislation in this area, and we hope that the Government will not waste the opportunity to make genuine progress on carer’s leave. As ever, I am happy to meet Ministers at any time to discuss this in greater depth.
The Bill could do more to support parents. We welcome the Government’s proposal that parents should be able to benefit from support, irrespective of how long they have worked for their employer. We also support the proposal to introduce new rights to bereavement leave, which will allow employees to take much-needed leave from work to grieve the loss of a loved one. This will be especially important to those who lose a close relative or who experience a miscarriage.
The Liberal Democrats have called for measures to support parents through unemployment, and to extend parental pay and leave to self-employed parents, as has been mentioned. We have also called for measures to increase statutory maternity leave and shared parental leave to £350 a week, and to increase pay for paternity leave, with an income cap for high earners.
In addition to improving the Bill’s support for carers and parents, we also believe it could do more to support people when they fall ill. At £116.75 a week, statutory sick pay remains far below the minimum wage and is effectively a disincentive to take time off. This has a severe impact on public health, productivity and, ultimately, economic growth. A higher rate of sick pay would enable people to take time to recover without having to worry about making ends meet. Of course, any such measures should go hand in hand with appropriate financial support for small businesses.
That brings me to how this Bill can be improved for the benefit of small business owners, and I have already stated my interest. It is vital that small businesses are actively consulted on how to support them with any additional costs that the Bill may bring. Having spoken to many SMEs in my constituency, I would like to know what consideration the Government have given to the Bill’s proposals on changes to unfair dismissal during probationary periods. How will small businesses, which do not have the resources of HR professionals, be supported through these changes? Unfortunately, much of the crucial detail that would help such businesses to prepare for the impact of the Bill has been left to secondary legislation and further consultation. Although we support as much consultation as possible, the lack of detail in the Bill does not facilitate certainty and stability for businesses or workers.
The Liberal Democrats urge Ministers to ensure that new measures to support workers go hand in hand with support for small businesses, starting with the reform of our broken business rates system. The current system effectively taxes business premises and machinery, which discourages investment and heavily burdens key sectors in my constituency, from retail and manufacturing to renewable energy production. Again, if Ministers are open to meeting me and my Liberal Democrat colleagues, we would be happy to discuss our proposal for reforming this broken system and bolstering our SMEs.
This Bill has the potential to mark a new chapter in how we deliver fairness for both business owners and employees. We believe it will modernise our legislation to reflect the needs of today’s workforce.
Mr Will Forster (Woking) (LD)
My hon. Friend has said that the Bill does not go far enough to support families. In my Woking constituency, 350 children are unable to join the Scouts because of a lack of volunteers. Does she agree that the Government should consider adding to the Bill a right to ask for statutory volunteer leave?
Sarah Gibson
My hon. Friend makes an important point about volunteering across the country.
But the Government must go further. We must do more to support carers, parents and those who fall sick. The Bill must do more to provide small businesses with certainty, stability and transparency. We on the Liberal Democrat Benches look forward to the Bill’s passage and will work with colleagues to ensure it delivers on its full promise, but we hope that our proposals to improve the legislation are fully considered.
Ms Stella Creasy (Walthamstow) (Lab/Co-op)
As a proud member of the Community and USDAW trade unions, I am delighted with the legislation. In the short time available to me, I will focus on the particular issue of whether we work to live, or we live to work, because so far the debate in this place, particularly in the remarks made by Conservative Members, has sounded like something from the mesozoic era and the dying era of the dinosaurs.
Let us get something straight: tackling sexual harassment in the workforce is not about free speech, but about stopping a crime; flexible working does not mean people work less, just that they work flexibly; and rights do not make people irresponsible employees, any more than it is noticeable that our competitors internationally are ahead of us on this work. The measures in the Bill are about entrenching good practice, so that we have a race to the top, not a flounder to the bottom, as we did under the previous Government.
That is why I and others hope to push the Government to go further on maternity and paternity rights. It vital that the Bill contains protections for mothers around maternity discrimination, but such measures will only work if we include the other 50% and bring dads into the equation. We do not really have a gender pay gap in this country any more: we have a motherhood pay gap and a motherhood penalty. Women face the discrimination of being made unemployed not only when they have children but because they might have children, and women who have kids find that when they go back to work, they are considered to be less committed, capable and competent. Women who are childless are six times more likely to be recommended for a job and eight times more likely to be recommended for a promotion.
The issue cuts the other way too, because there is a fatherhood premium as fathers are considered to be more reliable employees. We must not entrench these inequalities but overturn them, so that dads can be part of their kids’ lives and mums can get a fair crack at being in the workforce. A third of dads in this country take no paternity leave at all; half of them say that is because they feel pressured financially to go back to work early. Modern employers get the problem and are offering more than the statutory minimum. Some 92% of fathers who are job hunting say flexibility makes all the difference when they choose which job to take. After the pandemic, the number of stay-at-home dads increased by a third. Frankly, dads want to step up to the plate, whatever Members on the Conservative Benches may think, and mothers want them to be there too.
Making such changes matters to the economy. The loss of productivity that comes from women caring for their parents or their children means that millions are being cut out of our economy. We have some of the longest working hours for dads in Europe, and some of the shortest working opportunities for mums. Putting in measures to support paternity leave will be good for both sides of the equation. Let us not be the generation in which dads say they never got the chance to know their teenage kids, and mums say they never got the opportunities they wanted. Let us amend the Bill to ensure paternity leave matches maternity—
Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)
I will speak to the amendment, especially about the Bill being rushed through without full consultation.
On 13 May 2014, I tabled a ten-minute rule Bill on the Prohibition of Unpaid Internships, as Members will see in volume 580 of Hansard, column 593. On 14 November 2016, I tabled a private Member’s Bill, the National Minimum Wage (Workplace Internships)—volume 616 of Hansard, column 1156. On 27 October 2017, Lord Holmes of Richmond tabled the Unpaid Work Experience (Prohibition). And on 5 February 2020, I co-sponsored the Unpaid Work Experience (Prohibition) Bill introduced by Alex Cunningham, the former Member for Stockton North, now retired.
Despite unpaid internships being mentioned in the Government’s policy documents on work, they are not in the Bill. The Government have said that they will tighten up the ban, but there is no ban on unpaid internships—they exist, as they did in the last Parliament, not least with many a Member on the opposite side of the House. If there were such a ban, it would not have to be mentioned in policy documents.
A ban should have been brought in alongside the Bill. There will be a lot of hubris on the Government Benches about bringing forward a landmark employment Bill, with Labour Members saying the Conservatives did nothing, despite all the evidence laid out by my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) in his excellent opening speech. [Interruption.] It is all very well burying one’s head in the sand, but every one of the Bills I brought forward got kicked into the long grass, not least my private Member’s Bill, when the only Labour Member present was the shadow Minister. If Labour MPs had turned up, we might have been able to get a closure motion, but they decided not to. That has been the story throughout. If the Deputy Prime Minister does want the Bill to go through, she needs to fight off whatever it was that stopped it each time; I always started out with the commitment that it would happen, and then somehow people were convinced not to do it. I say that in a constructive way to the Deputy Prime Minister, who I know very well.
An intern should be defined as a worker. We were talking about an amendment to the National Minimum Wage Act 1998 that says that work experience is important, but after 20 days or four weeks in work, an intern should be treated as an employee. Work should always pay, and if someone is contributing after that period of time, they are adding something to the business.
Bradley Thomas (Bromsgrove) (Con)
Does my right hon. Friend agree that the fundamental approach behind the Bill should be one of pragmatism rather than tribal ideology?
Sir Alec Shelbrooke
I am grateful to my hon. Friend; pragmatism is important when we talk about business. In that spirit, there is a pragmatic reason why the Bill should not be given its Second Reading today—perhaps at some point it should, but I fear it has been rushed through to meet the spin about the first 100 days.
I would wager that few Labour Members today had plans to talk about unpaid internships, which is a very important issue. I could talk for a very long time about unpaid internships, as I have for hours in this Chamber previously. To ensure equal opportunities for young people, the issue of internships is vital, but it is one that is sadly lacking from the Bill. That speaks to the amendment tabled by my hon. Friend the Member for Thirsk and Malton: the Bill has to some extent been rushed.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I draw attention to my membership of the GMB. I support this landmark employment Bill, the biggest expansion of workers’ rights for a generation. Today we see the difference that a Labour Government can make for people up and down the country.
Although I support all aspects of the Bill, I will focus specifically on the transport sector. During and following the covid pandemic, transport workers faced the short end of the stick of poor employment practice. I welcome the end of fire and rehire. That unfair practice was used as a sledgehammer against workers, particularly during the pandemic, by companies such as British Airways, which tried it on more than 35,000 staff members, including many of my constituents in Hounslow. BA staff who had worked for decades faced the prospect of being sacked and rehired on poorer pay and weaker terms and conditions.
After huge pressure from trade unions, Labour MPs and the Transport Committee, BA dropped its plans, but other firms such as P&O have also exploited the weakness in UK employment law that the Bill is intended to address. Those practices are still happening, as my hon. Friend the Member for Montgomeryshire and Glyndŵr (Steve Witherden) highlighted in his intervention on the Deputy Prime Minister. When workers were facing fire and rehire, Labour was clear that a Labour Government would ban that practice, and I am pleased the Government are doing that. I welcome clause 22.
On minimum service levels, the Bill will also repeal and scrap the previous Government’s Strikes (Minimum Service Levels) Act 2023—a farcical bit of legislation designed to limit strike action. In Committee, when I pushed the rail operators on the proposed legislation, it was clear that they had not sought it and they appeared to have no plans to use it. The fact that so few rail operators chose to use the powers once they were enacted showed that the companies themselves doubted their value and use.
This Bill also brings in much-needed modernisation of our maritime laws. In the last Parliament, the then Chairs of the Transport Committee and the Business and Trade Committee—one Conservative, one Labour—jointly wrote to the then Government about the need to update our laws to protect maritime workers. I welcome the Bill’s closure of the loophole whereby ships registered overseas previously did not have to inform the UK Government of collective redundancies, and the fact that this Government have committed to further strengthen workers’ rights at sea.
In conclusion—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. I call Shivani Raja to make her maiden speech.
Shivani Raja (Leicester East) (Con)
It is with great privilege and a deep sense of responsibility that I stand before you today, Madam Deputy Speaker. As I take my place in this historic Chamber, I am acutely aware of the profound trust placed in us by the constituents of our great nation. I wish to express my heartfelt gratitude to the people of Leicester East for electing me to represent them in Parliament.
My story, like that of many in Leicester, is one of heritage, resilience and opportunity. My parents arrived in Leicester from Kenya and India in the late 1970s, bringing with them cultural and faith traditions and a remarkable work ethic. They made Rushey Mead their home, and I was born and raised there. From Herrick primary school to Soar Valley college and De Montfort University, Leicester has nurtured me every step of the way and for that I am deeply thankful.
As is customary, I pay tribute to Claudia Webbe, my immediate predecessor, who served the constituency to the very best of her ability. Claudia followed in the footsteps of Keith Vaz who, alongside Paul Boateng and Bernie Grant, broke new ground in the representation of people of colour in Parliament. In the election, I had the unique experience of standing against both Claudia and Keith—a testament to the vibrant political landscape of Leicester East.
Leicester is a city of remarkable history and diversity. Leicester hosts the largest Diwali festival outside India. It is home to the UK’s longest running comedy festival. It is one of England’s oldest cities, so much so that we found a king under one of our carparks; for those who do not know, one of our earliest kings, King Richard III, was found under a carpark in Leicester. The University of Leicester is the birthplace of DNA fingerprinting. Leicester is also home to the National Space Centre and we are proud of our contributions to the arts, sciences and sports.
We have got it all going on in Leicester, but if Members remain unconvinced that Leicester has influenced their life, because perhaps they are not a former monarch or a scientist in their spare time, Leicester has also given Britain icons like the late Lord Richard Attenborough and—very much living—Sir David Attenborough, Gary Lineker and Peter Shilton. Our city is where Walkers crisps were born and where fashion guru Gok Wan grew up. Leicester’s influence even extends to music, with entertainers like Engelbert Humperdinck and Showaddywaddy. So whether you have tucked into a bag of ready salted, gone to the cinema to watch “Jurassic Park” or boogied on down to “Hey Rock and Roll”, you’ve got Leicester to thank.
This is what true diversity looks like. In fact, in 2013 Leicester was described as the most multicultural city in the UK. Today, 59% of people living in Leicester are from ethnic minority groups, and 41% were born outside the UK. But most relevant to today’s debate is employment and businesses in my constituency. Leicester is located at the heart of England, and local businesses are the lifeblood of our city. Leicester was recognised as the UK’s most entrepreneurial city—a title that reflects the resilience, creativity and determination of its people. Our entrepreneurial scene is not just about numbers; it is about stories, of those who dared to dream big, hustled harder, and turned their ideas into reality.
The Employment Rights Bill threatens to undermine that spirit before those entrepreneurs have even made their first £1. The additional costs and regulations proposed will act as a barrier to entry, discouraging the very innovation and hard work that has earned Leicester that title. We must be cautious not to stifle the ambition of small business owners, who are the backbone of our economy. Our journey is one of innovation and community—a story of people coming together across different sectors and backgrounds to build something truly remarkable.
In a city as diverse as Leicester, many rely on flexible work to balance family commitments, faith observances or second jobs. By imposing blanket regulations that do not consider the unique needs of our communities, the Bill risks alienating the very workforce it aims to protect. We must ensure that employment regulations support businesses and workers alike. Imposing regulations that add costs without first offering support will harm the very people Labour claims to champion. For our small businesses in Leicester, many of which work with razor-thin margins, the burdens imposed by the Bill will be overwhelming. It is one thing to champion workers’ rights, but quite another to do so in a way that risks the survival of the very businesses that provide the jobs.
Let us not forget that successful businesses are the best way to secure meaningful long-term employment. Our decisions in this House will shape the future of our country for generations to come. It is imperative that we approach these challenges in a spirit of collaboration, transcending partisan divides to serve the best interests of all our constituents. With our nation facing economic challenges, the Bill risks raising costs for consumers and worsening the cost of living crisis, particularly in communities like Leicester East, where many are already struggling to make ends meet. We must find solutions that protect workers without penalising local businesses and their customers.
I am honoured to stand before the House as the Member for Leicester East, and I warmly invite you, Madam Deputy Speaker, and all hon. Members to visit our great city. You can join us for our glorious Diwali celebrations, our annual Pride parade or our vibrant Caribbean carnival. Come and experience the city where fish and chips are just as popular as samosas and kebabs, and where Stilton and Red Leicester cheeses sit alongside Italian pizza and French patisserie. The road ahead may be challenging, but it is also filled with possibilities. I firmly believe that not only Leicester’s but our country’s greatest days are ahead of us, and I am grateful to be able to play my part, championing my constituents in that endeavour.
Madam Deputy Speaker (Ms Nusrat Ghani)
I had to let that speech run over; I was waiting for my invitation to have samosas.
Mark Ferguson (Gateshead Central and Whickham) (Lab)
I pay tribute to the maiden speech of the hon. Member for Leicester East (Shivani Raja). I enjoyed her reminiscences about her community, and hearing about some of the more lively figures from the recent history of the Labour party. I proudly draw attention to my declarations in the Register of Members’ Financial Interests, which include my former role working for Unison, my membership of Unison, my donation from Unison, and being co-chair of its parliamentary group. Unison is Britain’s largest union, representing public service workers and in particular the low-paid women who will benefit so much from the Bill.
I pay tribute to all those who have worked tirelessly for years to build consensus around these changes—the biggest changes to rights at work in a generation. In particular, I thank those within Labour’s affiliated trade unions, on the Front Bench, and in Labour’s policy team for their hard work and dedication. Hon. Friends, including my hon. Friends the Members for Worsley and Eccles (Michael Wheeler), for Halifax (Kate Dearden), for Birmingham Northfield (Laurence Turner), for Tipton and Wednesbury (Antonia Bance) and for Knowsley (Anneliese Midgley), have been engaged in this work throughout. That is not an exhaustive list; many others on the Government Benches have worked tirelessly to help us to reach this day, and deserve immense credit.
This is the kind of Bill that is at the heart of why we are here. The Labour party was founded upon the idea that working people deserved representation in this place, that we were fit to govern, and that those who put in the bulk of the graft deserved to reap the rewards of their labours. Today is a landmark day in our party’s history, and in the history of employment rights in this country. The Bill is crammed full of improvements that are each worthy of a lengthy speech; however, I am down to my last minute and twenty seconds, so I will not do that. Let me say this instead: if you work, the Bill will change your working life for the better. We know why these changes are necessary. One in five of us is suffering from the effects of insecure work, with low pay, exploitative zero-hours contracts, and little or no sick pay.
Ms Polly Billington (East Thanet) (Lab)
My hon. Friend mentions that the measures in the Bill will be good for employees. Does he agree that they will also be good for business? My constituency’s economy is based on the entrepreneurialism of lots of small businesses and individuals creating work for themselves and for others. Does he agree that the Bill will support good employment policies in small businesses, helping with productivity and the retention of staff?
Mark Ferguson
I could not agree more. The people who will benefit from the Bill the most are not those who will buy stocks and shares but those who will spend their money on our thriving high streets, which this Government will build.
The care workers and teaching assistants I was proud to represent while working for Unison deserve pay and conditions that match the task of looking after us when we grow up and grow old. Stronger rights to collective bargaining through the school support staff and adult social care negotiating bodies are essential for recruitment and retention in those overlooked sectors. Could the legislation go further in those areas and in others? Of course—that is the nature of any Bill. The work of change is never done, but we should be in no doubt that this is the biggest, boldest and most welcome set of employment rights changes that all but the most experienced of us in this Chamber have considered. I know that the Government are committed to consulting widely with unions and businesses alike to ensure that.
This is what having a Labour Government means—rights from day one: banning exploitative zero-hours contracts; ending fire and rehire to lift employees from the insecurity felt by those working in the foundations of our economy; taking action on sick pay, and maternity and paternity rights; and holding unscrupulous employers to account through a genuine and comprehensive enforcement body. The Bill is pro-business, pro-worker, and focused on the challenges that millions of us face every day. It is one of the greatest honours in my life to have been involved with it, to speak on its behalf, and to vote for it this evening, mostly because I know the impact that it will have on my community in Gateshead Central and Whickham. The task of rebuilding Britain after 14 years of Tory rule is great, but our ambition for this country is greater still.
Graham Stuart (Beverley and Holderness) (Con)
I refer the House to my entry in the Register of Members’ Financial Interests, and the contribution from small businesses to my election campaign earlier this year.
History is repeating itself. Labour’s antipathy and lack of understanding for business, and small business in particular, is rearing its ugly head again. This legislation will have ruinous results for those who desperately need a job and hope. The Federation of Small Businesses says:
“This legislation is a rushed job, clumsy, chaotic and poorly planned.”
The federation goes on to say that the Bill will increase economic inactivity. That is a rather sanitised way of referring to the ruined lives, dashed hopes and huge waste of human potential that the Bill will bring about. At the end of the debate, we need to hear from a Minister how the Bill will be changed so that it supports rather than undermines the 4 million additional jobs created since 2010 under the Conservatives.
The economic impact assessment, so rudely provided so late in the day, shows that the costs of the Bill will fall disproportionately on small businesses—something that we have heard no acknowledgment of from Government Members. Five out of nine measures will have that effect. Do Ministers have any plans to change that?
Joe Robertson (Isle of Wight East) (Con)
Does my right hon. Friend agree that provisions that are bad for small business are also bad for workers, bad for taxpayers, and bad for those who rely on welfare payments?
Graham Stuart
I entirely agree, and places like the Isle of Wight, with so many hospitality businesses, will pay a particularly high price. We should celebrate and support our wealth creators, not burden them with excessive taxes and regulations that kill the drive to work, invest and create wealth. Yet that is the destructive path that Labour is taking, with a jobs tax planned for every worker’s national insurance contributions in the Budget in a couple of weeks, and this Bill to deter SME employment.
Antonia Bance (Tipton and Wednesbury) (Lab)
The impact assessment published earlier was 900 pages long, which compares pretty well with some of the impact assessments published under the last Government, a number of which I had the misfortune to read. It confirms that the cost to business will represent less than 0.4% of total employment costs across the economy, and the majority of that will be transferred directly into the pockets of workers, helping to raise living standards and offset the last 14 years of standstill wages. Has the right hon. Gentleman managed to read the impact assessment yet?
Graham Stuart
Well, the impact assessment was provided rather late, but it is always good to have a spontaneous contribution to any debate.
Removing the lower earnings limit and the waiting period will also disproportionately hurt small businesses and microbusinesses. That is set out in black and white in the economic assessment, so will Ministers make changes? It is with dark comedy that the Government say that their top priority is economic growth. Labour inherited the fastest growing economy in the G7, with 4 million more people in work than in 2010—4 million. In 2010, by comparison, we inherited a note that said that the money was all gone.
Darren Paffey (Southampton Itchen) (Lab)
Will the right hon. Gentleman give way?
Graham Stuart
I will not.
History tells us that Labour Governments always end with unemployment higher than when they began. They do not do it because they are evil. As has been said, no one in the Cabinet comes from a business background; they simply do not understand the realities. This Government seem bent on destroying employment even faster than their predecessors.
Small businesses are the lifeblood of our economy. They do enormous social good. As the FSB says, smaller employers are
“the ones most likely to give opportunities to people furthest from the labour market, such as those returning after long-term health issues or caring responsibilities.”
Yet under these proposals, the
“Plans to give day one unfair dismissal rights to new employees will add to the risks associated with hiring people.”
That increased risk will inevitably deter small employers from taking on new people for fear of facing an employment tribunal simply because a new recruit turns out to be unsuited to the role. How will Ministers ensure that a company selling food at summer festivals is not bankrupted by having to offer a contract to someone who is not needed after that period is over?
The Government have had a disastrous start. It is no wonder that the legislation is chaotic and poorly planned, given that Labour Cabinet Ministers are never early for work but always early for the free buffet at the Emirates or at Taylor Swift concerts. The Deputy Prime Minister is selling out the country’s interests in favour of trade union interests—selling out the people who vote Labour for the people who fund Labour. The Bill is a catastrophe, and I hope the House opposes it today.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
I am proud to refer the House to my membership of Unite and my declarations in the Register of Members’ Financial Interests, and to advise Members that I have run several of my own businesses.
This is a great day, and I wholeheartedly congratulate my right hon. Friend the Deputy Prime Minister and colleagues for introducing this landmark legislation, which will transform the lives of millions of workers for the better. We know why it is needed: just look at the fire and replace at P&O, the fire and rehire of British Gas workers, and the denial of rights at Deliveroo and Hermes. The legislation has long been in development, and I was honoured, when I was shadow Secretary of State for Employment Rights, to work with our trade unions and other stakeholders on the new deal for working people. I place on record my thanks to the Institute of Employment Rights—particularly Lord Hendy KC and Professor Keith Ewing—and to my staff Karl Hansen and Eli Machover for their work on that paper.
I am delighted that Labour will give all workers day one rights on the job, ban zero-hours contracts and outlaw fire and rehire. In the Bill, we establish the day one rights to claim unfair dismissal and to paternity, parental and bereavement leave, we create a right to a guaranteed-hours contract and we tighten unfair dismissal protections. Labour will modernise union balloting, simplify union recognition and improve the right of entry to workplaces. The Bill removes unfair balloting laws on recognition and industrial action, and creates new duties on employers to facilitate unions’ access.
I am proud that that is being done, but much of the Bill is about setting up a framework, and there will be significant further steps, consultations and work to craft the detail. In particular, we cannot finally consign insecure work to history until we have resolved a defined single status of worker. I recognise the Government’s commitment to consulting on that. On zero hours, I trust that Ministers will provide reassurance that employers will not be able to exploit new rights to guaranteed hours by issuing short-hours contracts. There are many other issues arising from that, but I ask Ministers to consider in particular a statutory right to paid kinship leave on a par with adoption leave.
This is truly a landmark Bill, and it is crucial that we make these changes as soon as possible. This historic Bill will help to deliver the well-paid, secure, dignified, skilled and productive jobs and the prosperous economy that we all wish to see. I am delighted to support it this evening.
Saqib Bhatti (Meriden and Solihull East) (Con)
Many small business in Meriden and Solihull East are rightly concerned about the Bill for a number of reasons. Since the election, I have spoken a number of times demanding that the Government be more ambitious for growth, for our entrepreneurs and for our small businesses. Indeed, it is the moral duty of every Government to unleash the full potential of our businesses and, where possible, to create an environment to embolden entrepreneurs and encourage economic growth.
Instead, the Bill will kill off any ambition and any focus on growth. If we want to focus on inclusive growth, we must nurture our start-ups, scale-ups and small businesses, and let them be nimble in how they operate, rather than shackling them. That is how economic magic will start to happen. The businesses to which I have spoken are worried about the insufficient consultation. The Government’s impact assessment, which we received late, shows that small businesses are likely to be hit hardest. The costs, according to the Government’s own analysis, will be in the low billions—up to £5 billion. For a Government who keep talking about the alleged black hole, those low billions seem rather reckless. It proves that this is nothing more than an ideological Bill that does not ensure growth.
Andrew Griffith (Arundel and South Downs) (Con)
Does my hon. Friend agree that, with just nine days until Halloween, the impact assessment we have seen today is an early horror show?
Saqib Bhatti
My hon. Friend makes a valid point. A lot of people are in a holding pattern for business decisions on investment and employment.
All the Bill will do is leave our businesses at the mercy of the trade unions and take us back to the 1970s. It will merely align us with the growth-gobbling guidelines set by bureaucrats in Brussels and hold our businesses back. It is not just me who thinks this; I am going by the Government’s impact assessment. The CBI claims that employers expect Britain to become the worst place to invest and do business over the next five years—a damning indictment of the Government.
Markus Campbell-Savours (Penrith and Solway) (Lab)
Will the hon. Gentleman give way?
Saqib Bhatti
I will not.
What businesses want is less government, less regulation and more freedom. When making employment decisions, they require certainty and flexibility so that they can hire more people, but the Bill threatens to undermine the agility of businesses in ensuring that their workers maximise productivity. It does not encourage businesses to take risk, hire a budding new employee and reap the rewards; in fact, it does the complete opposite. The Federation of Small Businesses calls this legislation “clumsy and chaotic” and suggests that it will “increase economic inactivity.”
Let us be clear: the Bill is not really about employment rights or better conditions. Its focus is on repealing the 10-year ballot requirement on political funds, removing the opt-in default for trade union political funds, removing the need for proper consent to form a trade union, and so on. It is not the Employment Rights Bill; it is the trade union appeasement Bill. The Government are not prepared to stand up to the unions. We have seen them cave in to train drivers and give sweetheart deals without any savings for the taxpayer.
Saqib Bhatti
I will not.
We have seen the unions hold the Government to ransom at the expense of hard-working taxpayers. That is why the Bill is bad for small and medium-sized businesses—those arguments have been made already. Our SMEs cannot afford dozens of French-style regulations that bolster the power of the trade unions and threaten to increase the cost of employment by over £1,000. I am speaking to raise the concerns of many small and medium-sized businesses in Meriden and Solihull East about this legislation. It is rushed—businesses have not been properly consulted—and it gives more power to the trade unions. It will fail to maximise productivity and will severely weaken the case for businesses to hire new employees. It is a flawed Bill serving a flawed ideology.
Imran Hussain (Bradford East) (Ind)
I refer Members to my entry in the Register of Members’ Financial Interests.
I support and welcome this transformative Bill. I place on the record my thanks to my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald), the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders), and the Deputy Prime Minister, with whom I have had the pleasure of working to play a small part in bringing this transformative legislation to the House.
In reality, the balance of power in our workplaces has been fundamentally set against employees for too long, meaning that the UK has some of the weakest labour protections in Europe, with legislation curbing the rights of working people to organise in defence of their rights, and insecure contracts and poor wage growth leaving one in five people struggling in poverty.
Under the last Tory Government, we saw an explosion in the growth of exploitative zero-hours contracts, unscrupulous fire and rehire practices, and the unforgiving and abusive gig economy. Ordinary working people across the country have experienced the most sustained period of wage stagnation for hundreds of years compared with our counterparts across Europe. Despite that exploitation of working people by bad bosses, the Tories never strayed from their mission of dismantling the power of trade unions to secure better jobs, pay and conditions for the ordinary people they represent, even in the middle of a cost of living crisis.
The Bill that we are discussing today, however, sets us on the road to implementing the transformative new deal for working people and to repealing the last Tory Government’s draconian anti-trade union legislation, which restricts people from organising in defence of their pay, terms and conditions. Spanning over 30 different measures, the Bill could give any of us a lot to talk about. However, as time does not permit that, I will concentrate on two or three areas.
With the establishment of a framework for fair pay agreements in the adult social care sector, the Government have acknowledged the immense benefits that collective sectoral bargaining can play. Social care workers are among the most crucial yet worst paid and badly treated groups of workers in our economy. I very much hope that the Government will introduce that framework for further sectors, and I encourage them to do so. Secondly, by ensuring that workplaces offer a guaranteed-hours policy to end the exploitation trap of zero-hours contracts that millions of workers find themselves in, the Bill ensures that we can provide the eight in 10 workers who desire greater stability more certainty over their contracted hours.
Thirdly, the Bill takes an important step towards widening access to statutory sick pay by removing the requirement to earn the lower earnings limit, and by making SSP payable from the first day of sickness. My sincere request to the Government is that, with the rate currently at £116.75 per week, we need in the consultation process—
Alison Griffiths (Bognor Regis and Littlehampton) (Con)
I refer Members to my entry in the Register of Members’ Financial Interests. I rise today to express my concerns about the impact of the Employment Rights Bill on one of the most vulnerable groups in our workforce: seasonal workers. Those individuals form the backbone of key sectors such as tourism, agriculture and retail, particularly in my constituency of Bognor Regis and Littlehampton, where many depend on seasonal jobs for their livelihoods. I fear that the Bill will put their livelihoods at risk, as well as the viability of the businesses that employ them.
The devil is in the detail, and detail is what the legislation lacks. Labour claims that the Bill will protect workers, but for seasonal employees the increased regulation will likely have the opposite effect. Small and medium-sized businesses that rely on flexible, short-term contracts to meet seasonal demand will face rising costs and greater bureaucracy when trying to bring on staff. Clause 1 on the right to guaranteed hours is so laissez-faire about how that will be implemented in a real-world business environment that it leaves significant ambiguity and doubt in employers’ minds.
Graham Stuart
Does my hon. Friend agree that we need more detail from the Minister tonight on that specific provision, before the House can in good conscience give the Bill a Second Reading?
Alison Griffiths
I absolutely agree with my right hon. Friend that detail is precisely what is needed for the Bill to be implemented effectively.
In my constituency, seasonal employers such as theme parks are at the mercy of the British weather and a short season. On a rainy day takings will be minimal, and managing costs accordingly is vital to remain viable. Moreover, the student and retired populations in my constituency value the flexibility that those contracts offer. The Bill will disincentivise employers from offering short-term opportunities and reduce employment options for those who depend on temporary work.
Rebecca Harris (Castle Point) (Con)
My constituency also has a lot of seasonal workers and a seaside economy. Does my hon. Friend agree that young people often get their first step on the job ladder through those jobs? They may well not get that opportunity if the legislation is passed.
Alison Griffiths
I thank my hon. Friend for a stellar point. I think most of us, certainly on this side of the Chamber, started our working careers in those jobs—I certainly did. Disincentivising employers from offering short-term opportunities will reduce those employment options.
About 1 million people aged 16 and over reported being employed on a zero-hours contract between April and June 2024. On average, those workers worked fewer hours per week than others, and 60% said that they did not even want more hours. In the hospitality sector, 90% say that it is their desired contract.
In conclusion, we must ensure that protecting workers’ rights does not come at the cost of the jobs they rely on. I urge the House to carefully consider the consequences and to amend the Bill to safeguard opportunities for seasonal workers.
Lola McEvoy (Darlington) (Lab)
I refer Members to my entry in the Register of Members’ Financial Interests—I am a proud trade union member. It is with great pride that I rise to speak on the Bill today. I have spent my career championing a better deal for working people at the Living Wage Foundation, the organisation that works tirelessly to champion the plethora of business benefits of being a good employer, as well as at the GMB union, where I was proud to work alongside an army of volunteer trade union reps who have great courage in standing up for their colleagues, day in, day out.
The Bill has been warmly received by business because it is not radical. The Bill is reasonable, and it is illustrative of the way that Labour will govern for the time we are given that privilege. It is reasonable that people can earn a minimum wage that meets the cost of living. It is reasonable that people cannot be forced to sign away their current terms and conditions or lose their job. It is reasonable that people are not sexually harassed at work. It is reasonable that people working the same shift pattern, week in, week out, are given contracts that protect and reflect that. The Bill will do all that and more. The Bill will right some of the wrongs that have been pushing working people into wholly unacceptable hardship over the last 14 years.
In the spirit of that mission-led approach to Government, I ask the Minister to consider the following points that will improve physical and mental health outcomes, as well as support more people back to work. Will the Minister consider paid time off for preventive cancer screenings? I met a woman who worked in a hospital as a key worker for a private company. She could not afford to take unpaid leave to get her smear tests, so she missed them and then discovered she had stage 4 cervical cancer. Paid time off for preventive screenings, which good employers already offer, will support our health mission as well as save lives. People must not have to choose between catching cancer early and feeding their families.
On parental rights, I welcome the strengthening of maternity rights in the Bill. For too long women have been penalised for having children, and the hard truth is that mothers are being forced to leave the workforce or take low-paid part-time work to make ends meet. I appreciate that the Bill will make paternity rights a day one right, and I look forward to the review on parental leave, because we need to normalise fathers being able to support their new families and bond with their babies. Protecting fathers to enable them to take paternity leave will help level the playing field and improve men’s mental health, as fathers want to be with their babies.
Dr Zubir Ahmed (Glasgow South West) (Lab)
Sixty-one per cent of people in my constituency are in poverty despite being in work. Does my hon. Friend agree with me that it is only when work is made secure that we can truly grow our economy?
Lola McEvoy
I absolutely agree, because people want to work, and they want to work in good-quality jobs that allow them to spend a decent amount of time enjoying the things that matter in life.
The Bill will make thousands of my constituents in Darlington better off, safer and more secure at work. More than that, it will benefit businesses’ bottom lines, as they will have a happier, healthier and more productive workforce. That is essential for the growth we need to see, it is good for working people, it is good for business, and it is great for the economy.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Katie Lam to make her maiden speech.
Katie Lam (Weald of Kent) (Con)
Thank you, Madam Deputy Speaker, for letting me make not just my first contribution to this House, but the first contribution from the newly formed constituency of Weald of Kent. My predecessors are illustrious: William Hart Dyke helped invent tennis, Charles Barnett was a first-class cricketer, and Edward Percy Smith was a scriptwriter like me, penning the Hammer Horror hit “The Brides of Dracula”. We even have a Prime Minister in our history: Benjamin Disraeli began his parliamentary career representing a patch of Kent that includes the village of Linton, which is now in my constituency. However, only one of my predecessors, Ann Widdecombe, can boast Britain’s highest honour: an appearance on “Strictly Come Dancing”. [Laughter.]
Two of my most recent predecessors have left this place. Damian Green and Damian Collins both worked doggedly for the area and for the country in government—Damian Collins especially in the field of digital, culture, media and sport, the Select Committee for which he chaired for many years, and Damian Green with senior roles in government, all the way up to First Secretary of State. Both served my constituents with distinction, and on their behalf, I would like to say thank you.
I am not the first politician in my family. My grandmother came to Britain in 1937 at the age of 13 as a refugee from Germany. Her grandfather, Paul Heide, was a state senator and a fierce critic of the Nazis. When Hitler came to power, the whole family were arrested and stripped of their citizenship. After years in prison, Paul jumped out of the window of his second-floor cell and made it to Czechoslovakia despite his broken ankle. There, the family set up a resistance radio station broadcasting back over the border, until one night they were raided by the SS and one of the operators was shot dead. They managed to escape, and fled to England and freedom. My grandfather’s family were far less fortunate: Jews from Amsterdam, almost all of them were murdered in Sobibor and Auschwitz. One of them was eight years old.
My grandparents’ stories helped make me who I am, so even as a small child, I already knew the power of politics. It is an honour to take my place in Parliament, to serve my constituents and this country—the country that saved my family and saved the free world—but freedom does not come for free: it must be fought for. Every time I come into this Chamber, I see the shields that surround us and think of our country’s sacrifice. Colonel Victor Cazalet, whose shield is on the other side of the Chamber, lived in Cranbrook in my constituency. He had already served with distinction in the first world war, receiving the Military Cross for gallantry in 1917. He was killed in an air crash in world war two, as was Commander Rupert Brabner, whose shield is a few places further down. Commander Brabner was the Member for Hythe, a constituency that borders my own, and an ace Royal Navy pilot awarded the Distinguished Service Cross. We will remember them.
The weald of Kent has played its part in our nation’s sacrifices. Headcorn aerodrome operated in the second world war as RAF Lashenden, at the same time as Benenden school was converted for use as a military hospital, and Coxheath was once the British Army’s largest training ground. The constituency may be new, but the Kentish weald is anything but: Appledore was raided by the Vikings in 893, and the Archbishop of Canterbury had his palace at Charing as far back as the year 900. Enriched by ironmaking in Biddenden and clothmaking in Marden and Staplehurst, today the weald of Kent boasts hundreds of square miles of the most gorgeous countryside, surrounding two delightful towns—Tenterden and Cranbrook—as well as over 100 of Britain’s most charming villages, many 1,000 years old or more. From Aldington to Yalding, every one of the weald of Kent’s 56 civil parishes is a rural jewel. The area is awash with medieval churches, cricket clubs, intricate gardens, and a mosaic of farms growing the nation’s food—and now, vineyards growing the very finest British wine.
Do not take my word for it: the glory of the weald of Kent has been immortalised in films, books and television shows. H.E. Bates was inspired by his home, Little Chart, to write “The Darling Buds of May”, and the TV adaptation was filmed in Pluckley and neighbouring Bethersden. Godmersham Park was the inspiration for Jane Austen’s “Mansfield Park”, while Agatha Christie fans will know Chilham as the backdrop for episodes of “Poirot” and Smarden as a television stand-in for Miss Marple’s home, St Mary Mead. The steam train in the opening shot of “Downton Abbey” is the Kent and East Sussex railway, rolling from Rolvenden to Wittersham Road, and one of my favourite films, “Kind Hearts and Coronets”, shot its countryside scenes in Boughton Monchelsea.
Lastly, I should like to give a few personal thanks. First, I thank hon. Members on the Government Benches, for it was while delivering leaflets for their party that Grandma and Grandpa Lam met in the late 1940s. Had the Mill Hill Labour Club never existed, neither would this Conservative. [Laughter.] Secondly, I thank Alex, my family and my friends for all they have done for me. Thirdly, I thank the best Conservative association in the country. Finally, I thank the people of Weald of Kent who have sent me here to represent them. I will never look at the responsibility of being the Member of Parliament for Weald of Kent as merely a job; I will always treat it as an honour.
Madam Deputy Speaker (Ms Nusrat Ghani)
We now have another maiden speech. I call Sarah Smith.
Sarah Smith (Hyndburn) (Lab)
Thank you, Madam Deputy Speaker. As a proud trade union member, I refer to the House to my entry in the Register of Members’ Financial Interests, and congratulate the hon. Member for Weald of Kent (Katie Lam) on her moving maiden speech.
It is with great pride and humility that I rise today for the first time as the elected Member for Hyndburn and Haslingden. I start by paying tribute to my immediate predecessor, Sara Britcliffe, for her commitment to Hyndburn and for leading the way as the first woman to represent the constituency. I cannot make this speech without also paying tribute to the previous Labour Member, Graham Jones, whose selfless support and kindness I am privileged to have received. Graham is the most fierce champion of Lancashire: he has fought tirelessly for the people of Hyndburn, and is a man you always want in your corner. With the north-west of England being scourged with gambling-related suicides, particularly among young men, Graham led the successful campaign to reduce the maximum stake on fixed-odds betting terminals from £100 to just £2. That campaign will undoubtedly have saved and improved many lives.
It may surprise Members when I say that Hyndburn is not a real place. No one really relates to being from Hyndburn; instead, they identify proudly as a resident of Accrington, Great Harwood, Rishton, Altham, Oswaldtwistle, Clayton-le-Moors or Church. Each of those communities has its own rich history, culture and identity. My constituency is the home of the largest Tiffany glass collection in Europe, the Accrington Pals, and the Nori brick, which was used to build the Empire State Building. It is also the home of one of the 12 founder members of the football league, whose legacy is continued by Accrington Stanley football club. I am sure the House will join me in congratulating the boys on their third win on the trot against Barrow at the weekend.
Perhaps most significantly, my constituency was the engine of the industrial revolution during the 19th century. The invention of the spinning jenny, the mechanisation of calico printing, and the creation of turkey red and khaki dyes enabled the globalisation of the textile industry, but the huge wealth that the mill owners made was often at the cost of the workers, whose living and working conditions were terrible. I also represent the magnificent and diverse town of Haslingden, whose coat of arms reads “Nothing without labour”. That motto was a statement of solidarity: in 1826, amid loom-breaking riots in east Lancashire, hundreds of people in Haslingden attacked machinery in protest at pay cuts and their awful working conditions. Many perished due to poverty and hardship, but by 1850 and with the support of churches and reformers, a minimum wage was eventually introduced.
We stand in this Chamber almost 200 years later, and although things have of course improved hugely, too many of my constituents are still struggling to make ends meet with zero-hours contracts, low wages and insecure work. While in the 19th century, workers had to literally fight for basic rights, we now—thanks to trade unions and the Labour party—have representation of working people in this more civil way. That is why I welcome this Bill, which strengthens employees’ rights, stops the exploitative use of zero-hours contracts and, importantly, gives people the right to maternity and paternity pay from day one.
Hyndburn and Haslingden is a magnificent and beautiful constituency that I am proud to call home. It is where my husband James grew up and where we got married, in the beautiful church of St Peter and St Paul’s where his dad, Paul, was the vicar for 18 years. As well as showing dedication to his parish, Paul was instrumental in establishing the sixth-form provision at St Christopher’s school, which has changed the lives of countless young people. Tragically, we lost Paul within days of my election, so he is not here with us today, but I will continue to fight to break down all the barriers to opportunity that our children and young people face.
Without my family, I would not be standing here. I want to put on record how grateful I am to my parents, Rosemary and Gary, to my brother Mark, and to Margaux, James, Ellie and both the Ruths for believing in me and standing by me every step of the way. As a Christian, I also give thanks to Jesus for giving me this opportunity. As I go on this journey, I will remember always the verse in Micah and aim to carry out justice, to love mercy and to walk humbly with God throughout my time here.
I first got involved in politics because I think it is wrong that, far too often, the postcode where people are born determines so many of their life outcomes. For as long as I am privileged to represent Hyndburn and Haslingden, I will work tirelessly to ensure that children born in Clayton have the same life chances as those born in Chelsea, and I will make it my mission to represent them in the corridors of power, but I will also make it my mission to be present, transparent, and accessible as a local champion for the residents of Hyndburn and Haslingden.
Wera Hobhouse (Bath) (LD)
I congratulate the last two speakers on their powerful maiden speeches. Both of them were most moving. As we always discover in this place, there is more that unites us than divides us. What unites me with the hon. Member for Weald of Kent (Katie Lam) is clearly Jane Austen. I say to the hon. Member for Hyndburn (Sarah Smith) that I lived in east Lancashire for 15 years, and I know the area well. I was sorry to hear about the loss for her family.
I am pleased that many of the measures that we Liberal Democrats have been campaigning for over many years have been included in this Bill. I am most pleased about the reinstatement, in clauses 15 and 16, of the original wording of my Worker Protection (Amendment of Equality Act 2010) Act 2023. Introduced as a private Member’s Bill, my Act amended the Equality Act 2010 to better protect employees from workplace harassment and sexual harassment. In addition to creating a direct preventive duty, it would have created new liabilities for employers in cases of third-party harassment, unless employers took all reasonable steps to prevent it. That would have created protections similar to those that were originally in the Equality Act 2010, but were removed by the Enterprise and Regulatory Reform Act 2013. Amendments to my Bill in Committee in the Lords removed that clause, so that no such liability was created. The ridiculous argument was made that it would have prevented free speech. It therefore remains the case that employers have no liability for harassment of staff by third parties. My original Bill would also have created a new legal duty for employers to take “all reasonable steps” to prevent sexual harassment of their employees. As a result of amendments made by the Lords, that was reduced to “reasonable steps”.
Since my Bill passed into law, excellent progress has been made. A study by Culture Shift found that 66% of businesses felt that the prevention of sexual harassment is of high importance. However, according to WorkNest, three quarters of employers cited protection from harassment by third parties as a concern. There is clearly an appetite among businesses for including these protections in the Bill. Too many people suffer still from sexual harassment in the workplace. I congratulate the Government on taking further steps to remove that blight on our workplaces.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
As an MP from Cornwall, where we have seasonal workers aplenty, I should say that although the Bill talks about a suggested reference period of 12 weeks, after which average hours will be offered, employees do not have to accept that if they do not want to. They can choose to stay on zero-hours contracts.
We have a large demand for social care in Truro and Falmouth. Our population tends towards an older demographic. As many people leave friends and family to retire to Cornwall, the availability of care is especially important. Assistance for people who have disabilities, so that they can live independent lives and be supported into work if they choose that path, is crucial. Skilled care workers are chronically underpaid for what they do—they are often on the minimum wage—and good people leak out of the system, as it pays more to work in the local supermarket.
I worked as a teaching assistant at a local secondary school—I declare my interest in the register as a Unison member—and I was also an equity partner in a trade union law firm, so I have some experience of employing people, too. The pay for working in a school in a supporting role can also be very low—sometimes minimum wage. What the care and school sectors have in common, apart from poor rates of pay, is that, as others have said, they involve highly skilled jobs that are incredibly important for our society, and those who work in them are far more likely to be women. The Bill has many provisions that will help with sick pay and parental leave, and will give protection from unfair dismissal from day one. It also improves family-friendly rights, provides for flexible working, and has measures to tackle zero-hours and minimum-hours contracts. However, it also specifically gives respect and recognition to social care workers and school support staff through a fair pay agreement for adult social care, and by reinstating the school support staff negotiating body. This will be a game changer for those low-paid workers, mostly women, who work in care and in schools. It will mean that pay, terms and conditions for care workers and school support staff are negotiated nationally, and that a minimum is set across the country.
I am so pleased that the Government have chosen those two sectors as the first to have the opportunity for fair pay agreements. Women with caring responsibilities are often limited in the hours they can work. Historically, that has meant that, however skilled and important their jobs are, they have not been properly rewarded or looked after. Changing that will be transformational.
Truro and Falmouth has Cornwall’s only acute hospital and the seat of Cornwall unitary council within its boundaries. That means that we have a large number of people who work in the public sector. Many of those jobs have been contracted out, and the terms and conditions for those roles have been gradually eroded. This Bill enables Ministers to create a code to prevent the emergence of a two-tier workforce when outsourcing occurs. A new national procurement statement will make sure that the Government use their contracts to raise employment standards, not dilute them. This employment Bill is a huge step forward, and I am proud of it.
Dr Neil Shastri-Hurst (Solihull West and Shirley) (Con)
It is a pleasure to follow several excellent maiden speeches this afternoon.
For an economy to thrive, both employers and employees must feel protected. Protections enable both parties to draw comfort. However, this Bill does not uphold that principle. In its approach and in its drafting, this Bill has fallen off its axis. It has, without doubt, landed in a place where it overwhelmingly favours the employee, to the detriment of any working balance with the employer. This should come as no great surprise. After all, given the paucity of private sector experience in the Cabinet, it was almost inevitable that this Bill would be seen through the prism of trade union bias. Having studied the Bill, one cannot fail to conclude that the Ministers who commissioned it have no understanding of the struggles faced by small and medium-sized businesses up and down the country.
While there is much to be derided in the Bill, there are two points I wish to raise for Ministers’ consideration. First, the abolition of the qualifying period for bringing an unfair dismissal claim will inevitably mean a rise in the number of claims presented to the employment tribunal. This will flood an already overwhelmed system. I ask the Minister: what true impact assessment has been made of that?
Under this Bill, bringing a claim for unfair dismissal becomes, to all intents and purposes, a day one right. There is a lack of clarity about the length of any probation period and the obligations on an employer when seeking to dismiss in that period. Inevitably, these obligations will increase the burden on SMEs, which will not have the depth of resources of their larger counterparts. The predictable consequence is that small businesses are likely to sink under the weight and cost of these additional requirements.
My second point relates to the proposed changes in respect of industrial action and trade union relations. By repealing the Strikes (Minimum Service Levels) Act 2023, lowering the ballot threshold for union action and requiring employers to direct their staff towards unions, the Government have demonstrated their willingness to bow down to their union paymasters, to the detriment of hard-working businesses and industry. The public will see this for what it is: a cheap effort to curry favour with the unions while lining the pocket of the Labour party.
It is clear from my conversations with small business owners in Solihull West and Shirley that the Government’s proposals will only hinder growth and productivity. These measures fail to strike the balance between employer and employee. They will choke our courts, cripple small businesses and stifle employment growth.
John McDonnell (Hayes and Harlington) (Ind)
I remind the hon. Member for Solihull West and Shirley (Dr Shastri-Hurst) that across those European countries with the highest union density, people have the best wages and working conditions and the greatest productivity, which somewhat undermines his last argument. I refer you to my entry in the Register of Members’ Financial Interests, Madam Deputy Speaker.
We are calling this the Employment Rights Bill, but it is not about rights as such; it is about power. When trade unions first discovered the concept of solidarity in the early industrial revolution, they discovered that, through unity, they could exert power to influence, to improve working conditions and wages, and to secure a better overall quality of life. Since 1979—I started work a few years before then—successive Conservative Governments have understood the distribution of power, and as a result they have used legislation to undermine trade union rights, so as to reduce the power of workers to defend themselves at work and improve their working conditions. All that the Bill does—I welcome it wholeheartedly—is take a small step to rebalance that power. It will not just improve wages and working conditions, but lead to a better economic situation for all concerned—employers and employees—full stop. That is what it is about.
Andy McDonald
Would my right hon. Friend agree with me that the steps outlined in this Bill will help to address insecure work, and will allow people to enjoy decent, secure wages and dignified work, as well as to plan for their future and that of their family?
John McDonnell
Yes, and as a result, people will work better, increase their productivity and improve the profitability of companies, which is beneficial to us all. It is as simple as that. However—there is a “but”—there are a few points on which I would press the Government to go a bit further. The first is sectoral collective bargaining and fair pay agreements. In the early 1970s, 86% of our workforce was covered by collective agreements, but that is now down to 20%. Where collective agreements have operated, they improve productivity, wages and conditions, and increase industrial harmony in the economy. We as a Government are starting off by introducing them for adult social care, which I thoroughly welcome, because there is such low pay and exploitation in the sector. However, I would like to see an enabling clause in the Bill, so that we can move on swiftly to other sectors in which we can get agreement across the trade union movement and engage with employers.
The second point is on single worker status, to which my hon. Friend alluded. Consultation is taking place on that, and it is absolutely critical, because we have seen some of the most exploitative practices in parts of the economy where workers have been forced into bogus self-employed status.
The third point is on insourcing. The Government have promised the biggest reform of insourcing in a generation. There is no mention in the Bill of insourcing, but there is mention of reform to procurement, and it is important that through our reforms to procurement, we bring forward insourcing as rapidly as possible. Outsourcing has produced an insecure, low-paid form of employment that is already resulting in industrial strife. Over the next couple of weeks, we could see strikes in virtually every Government Department because of what is happening on outsourcing.
On fire and rehire, the question is what a company has to do to prove that there is financial stress because of the economy. I also have two final points. One is on the seafarers’ charter; it has been mentioned that the second stage of discussions are taking place. That charter is critical if we are to provide basic protections for seafarers. Finally, prison officers have been denied the right to strike since 1994, and even Tony Blair said that he would restore that. I want to see that in this Bill, and I shall table an amendment accordingly.
Joe Robertson (Isle of Wight East) (Con)
I congratulate those who have given their maiden speeches today and spoken with such passion for and about their communities.
There is much in the Bill that I support, and I support the sentiment behind it. I am sure there is common ground in wanting to improve conditions and rights for workers, but there is a balance to be struck, and I have grave concerns about some provisions in the Bill—those that increase burden and red tape on employers and on employees, and those that are a threat to and a drag on economic productivity.
My first concern is the unnecessary introduction of a new concept of statutory probation. As the law currently stands, workers get protections against things like unfair dismissal. Those long-standing principles have survived different Governments, and indeed survive in this Bill. The debate has been about when those rights are accrued—whether it is after two years of employment or one—and there has been a fluctuation. This Bill attempts to introduce those rights from day one, but then to row back on them by introducing a statutory probation period, during which, in the Deputy Prime Minister’s own words, there is only a “light touch” approach to unfair dismissal. It creates a new concept that is vague and unclear, and it will increase the glut of litigation in the employment tribunal. Indeed, it will need to do so to create case law so that employees and employers can understand what a “light touch” approach to unfair dismissal means.
My second concern is the increased burden on smaller employers. Indeed, that is contained in the Government’s own analysis, and much has been said about that, so I will turn to my third issue: specific burdens in specific sectors, such as social care. The Government’s own analysis says that the Bill will increase costs for employers, but employers in social care cannot bear any more cost. The Government have said they will bring forward reform of social care; that must come first, before this law is brought into force.
Robbie Moore (Keighley and Ilkley) (Con)
Does my hon. Friend agree that the crux of the issue is that the Bill is lacking in detail? The issues he is discussing have been identified and indeed referenced in the Government’s own economic analysis, and we cannot get into the detail of this debate without having that level of information on the face of the Bill.
Joe Robertson
I agree that the Bill lacks detail. It also contains a lot of powers that are intended to come about through secondary legislation. For example, we do not know how long that probation period will be, because it is not set out in the legislation.
Turning to the NHS, we understand that the Chancellor will increase the money to the NHS in the Budget but, as an employer, the NHS will have increased costs through this Bill. If national insurance contributions on employers are to be raised in the Budget, it will have that cost as well. That means there will be less money available to cut waiting lists. I urge the Government to delay this Bill, get the detail right and put some detail into it, and ensure that sectors such as health and social care get the support first so that, as employers, they can deal with the increased costs from this legislation.
Becky Gittins (Clwyd East) (Lab)
Madam Deputy Speaker, I refer you to my entry in the Register of Members’ Financial Interests, where you will see that I have worked for a trade union that is not affiliated to the Labour party and that did not donate to my campaign. You will also see a number of other trade unions listed, not because of any campaign donations or vested interests —I can see why Opposition Members were led there; that is far more familiar to them—but because of the fantastic trade union representatives who have supported me and, I am sure, many Members on the Labour Benches. For me, that was Jim, my Unite rep in my very first job when training as a finance management trainee, all the way through to Laura, Trudy and Claire, the GMB reps who looked after me and supported me in my job before I was elected to this place.
I rise in support of the Bill, which is a central tenet of the Government’s policy to put working people at the heart of our economy and make work pay. As I said, I am a proud trade unionist, and I am proud to stand alongside millions of working people across the country who we depend on to drive our economy and provide the services we all need. I wish to call out some claims that I have heard from Opposition Members throughout this debate—and before; they are quite tired claims—that supporting the advancement of people’s rights at work is in some ways a vested interest. When were the working people of this country ever just a vested interest? It is in the interests of the working people of this country that we should be governing.
As a former trade union industrial officer, I know that finding a way forward in collaboration with those on both the employee and employer side is not always the easiest thing to do, but it is always the right and most productive way forward, so I am pleased that within their first 100 days, as promised, this Labour Government have presented this excellent Bill, and in doing so have ripped up many of the provisions in the Trade Union Act 2016. Rather than ameliorate industrial relations, that legislation was symptomatic of an aimlessly combative approach in that area that the previous Government drove forward. The effect, as we sadly know, was some of the worst disruption in decades. The public responded in July; they had had enough of that toxic and self-defeating approach.
I am delighted that measures in the Bill will modernise employment laws, with much of the Trade Union Act 2016 dismantled and, quite rightly, thrown in the bin. This upgrade for workers’ rights establishes day one rights for parental and bereavement leave for millions of workers, and statutory sick pay will be strengthened. The Bill is part of the platform for that approach. I welcome its content and the commitment to work with all stakeholders to ensure that it is implemented in such a way that benefits all my hard-working constituents of Clwyd East.
Chris Law (Dundee Central) (SNP)
The SNP broadly welcomes the core elements of the Bill, having long called for many of these changes. We have been clear in our opposition to zero-hours contracts, fire and rehire, and other forms of precarious employment that strip workers of job security. Indeed, former MP Gavin Newlands tried twice to introduce such measures with a private Member’s Bill. We have supported the removal of the lower earnings limit for statutory sick pay and the end of the waiting period, allowing those who are ill to access support from day one. Provisions for unpaid parental leave, paternity leave, and the right to claim unfair dismissal from day one are progressive steps towards workers’ rights that we must endorse. Similarly, scrapping anti-trade union laws such as the Strikes (Minimum Service Levels) Act 2023, is an important step in restoring the ability of unions to properly represent workers.
Johanna Baxter
Does the hon. Gentleman agree that if he is supportive of workers’ rights, those Unison members who are currently on strike in Perth and Kinross have a valid claim to a decent pay rise from his Government?
Chris Law
I think the question that the hon. Member refers to is with the Scottish Government, and of course we listen to trade unions in all cases. Indeed, a fair pay settlement was agreed with all unions, until we heard about this one recently. Our former colleague, Chris Stephens, fought tirelessly for trade unions, and spoke passionately in this House about rights for workers.
However, Labour has not gone far enough or acted swiftly enough with this Bill. Gaps remain in its plans, with around half the promised reforms being kicked into the long grass through consultation, meaning that we will not see changes implemented until next year, the year after, or perhaps even 2027. Critical elements—such as the commitment to a single status of worker, the right to switch off, and addressing pay discrimination through mandatory reporting of ethnicity and disability pay gaps—are missing entirely. The Bill was meant to be a defining piece of Labour’s first 100 days in office, but what good is meeting that deadline if the meaningful reforms are missing or will not come into effect for years? This Government are looking overly cautious and hesitant, and in the past weeks people have been writing to me, asking whether that is because the Government want to delay and find a convenient way out of implementing the measures.
The SNP Government in Scotland have taken meaningful steps to promote fair work practices, such as supporting collective bargaining, achieving real living wage employer status, and closing the gender pay gap faster than the rest of the UK, which contrasts sharply with the environment created by the previous UK Government. Devolving employment law to the Scottish Parliament would ensure that no worker in Scotland is disadvantaged by Westminster Governments. Indeed, Scottish Labour’s 2021 manifesto supported devolving employment rights—that might surprise some MPs present today. I look forward to their support to ensure that employment law is devolved to Scotland during this Parliament, so that workers in Scotland never again have to see their employment rights eroded by any future Tory-led Government.
The Scottish Trades Union Congress general secretary, Roz Foyer, commented that
“the Employment Rights Bill isn’t the terminus. It’s the first stop. This can be the foundations on which we can build.”
I agree. It is imperative that workers’ rights are improved by the Bill, but it must go further and faster, and look to devolve those powers so that we can guarantee that the rights of working people in Scotland are protected and strengthened.
Madam Deputy Speaker (Caroline Nokes)
I call Dr Marie Tidball to make her maiden speech.
Dr Marie Tidball (Penistone and Stocksbridge) (Lab)
I refer Members to my entry in the Register of Members’ Financial Interests. I am a proud member of the GMB, Unison, and Community trade unions.
When I was born, the room in Barnsley hospital was filled with flowers. No one knew how long I would live for or what operations I might need. Our communities in Penistone and Stocksbridge nurtured me growing up, and world-class NHS care at Barnsley and Sheffield children’s hospitals enabled me to walk and follow my ambitions. My local state education in Penistone helped me to catch up, and to go on to study law at university and fulfil my potential. My inimitable parents taught me that there was no such word as “can’t”, as well as the values of fairness, equality and justice—values at the heart of this Bill. I will use my skills and experiences, as the MP for our constituency, to give back to the communities that gave me so much, including incredible teachers and teaching assistants who helped to make education a way to overcome people’s assumptions about my disability, and to feel free. Achieving health and education equality is a huge asset to our country and critical to the health of our economy.
I am proud to be the first Member of Parliament for Penistone and Stocksbridge in over 100 years to have grown up there. Our rich agricultural heritage has put food on the country’s table, and the grit and determination of local miners, the steelworks in Stocksbridge and ironworks in Thorncliffe powered the industrial revolution, with the latter also producing Churchill tanks, which defended our country in world war two. Those sites remain economically important today, with the specialist LIBERTY Steel now producing steel that powers our UK aerospace industry.
The landscape of our very special constituency has helped to shape our laws before. Poignantly, the day of the general election marked 186 years since the Huskar pit disaster on 4 July 1838, when flooding caused the pit to collapse, killing 26 children. That tragedy led to the Mines and Collieries Act 1842, which banned women and girls, and boys under 10, from being employed in underground work. I learned about that tragedy at school and I knew then, as I know now, that law and politics have the power to improve people’s lives. The past we inherit; the future we build. This Bill makes the biggest upgrade to workers’ rights in a generation, with the driving purpose to change the lives of people across our country and make them better off. Ensuring that the very special people of the place that made me continue to innovate to change the world will be central to the work I do here.
Like the blooming heather that sweeps down the moors past the crystal waters of our rivers and reservoirs, towards our towns and villages, talent bursts forth in our constituency out of the dramatic landscape, gruelling weather, and lives hard-worked and hard-won. People in my constituency literally shoot for the stars: Grenoside’s Helen Sharman was the first British citizen to go into space in 1991; Thurlstone-born Nicholas Saunderson was a blind 17th-century Lucasian professor of mathematics at Cambridge university; and England international footballer, John Stones, also hails from that village, and follows a long and proud history of footballers who have gone through Penistone Church FC.
This summer also saw Olympians made in our constituency. Gunthwaite’s Becky Moody won bronze in dressage with her horse Jagerbomb. Caden Cunningham, who won silver, was trained in Oxspring at Quest Taekwondo. Musicians abound, too. Alex Turner of the Arctic Monkeys makes sure that High Green is resolutely on the map. We can also boast stellar folk singers like the talented Rachael McShane of Bellowhead and Cawthorne’s award-winning Kate Rusby, whose elegiac music of home has healed many a heart and inspired the mind. Ecclesfield produced Barry Hines, the author of “A Kestrel for a Knave”, which was turned into the acclaimed film “Kes”. He documented working-class lives for more than 40 years. Local author Matt Coyne’s “Frank and Red” was the literary comedic mug of hot chocolate that kept me going through the general election.
While our beliefs start from a different place, I share my predecessor Miriam Cates’s passion for education; I hope her new role gives her the chance for leadership on changing the safety of social media for young people. Angela Smith’s legacy as a good constituency MP is something that I aspire to. Helen Jackson’s work on community building in Northern Ireland, as Parliamentary Private Secretary to Mo Mowlam, provides lessons of hope that resonate in the times of hate that we must combat today. I am also grateful for Mick Clapham’s support; I know we will see his legacy on the mineworkers’ pension scheme continue under this Government.
Love, tolerance and doing things for other people are values knitted across the place I call home like the blankets woven from the yarn of Penistone sheep. To the people across Penistone and Stocksbridge: it is the privilege of my life to serve you. As your MP, I will work hard every day to be a strong voice for our communities and ensure that people growing up and growing old in our constituency can fulfil their potential. I will do what it takes to get things right and to get things done. We are a Government who will restore hope across our communities and bring people together. I cannot wait to work with Members across this House to make that change happen.
Lewis Cocking (Broxbourne) (Con)
I thank hon. Members for making their maiden speeches. As I have said before, I am a geographer, so it is a real pleasure to hear about our great United Kingdom and the different constituencies that we all represent.
Entrepreneurs in the towns and villages I represent across Broxbourne are working hard to take risks day in, day out to get our local economy growing and to create jobs, but I fear that the Bill could put all that at risk. Security in work should be available to everyone, but above all else it is getting the job in the first place that is the first vital step. Regrettably, the Government’s plan will only make it harder for businesses to hire new employees. Small business owners in my constituency cannot call on large human resources departments to make sense of these new rules. Increasing the number of day one rights will see them hesitant in making hiring decisions. As the Federation of Small Businesses has said, plans to give unfair dismissal rights from day one
“will inevitably deter small employers from taking on new people”
by raising the chance that new recruits will take their employer to a tribunal simply because they turn out to be unsuited to the role.
The principle of qualifying periods for workplace rights is sensible and fair. The Government must recognise that, because they have chosen not to include in the Bill a reform of the qualifying period of two years for statutory redundancy pay. A balance must be struck to avoid the burden falling too heavily on either the employer or the employee—especially for small business employees, who need the security and confidence that the qualifying period provides. It is clear that the Government’s plans do not strike that balance.
One thing I agree with the Government about is that we must get our economy growing faster, but this Bill, on which the Government have not consulted, is not the right way to achieve that. In this place, we should talk more about how to encourage firms to create growth.
Joe Robertson
My hon. Friend talks about growth. Does he agree that growth for small businesses is good for workers and that what is good for small business is therefore good for workers? Small business needs better protection in this legislation.
Lewis Cocking
I absolutely agree. If we do not create the next generation of entrepreneurs in this country through the education system, which the Government should be focusing on, rather than placing burdens on them—we have yet to hear the Government’s new Budget, which could increase taxes and put more burdens on small businesses—there will be fewer jobs in the market and fewer jobs for the people we are trying to represent and protect in this place.
It is Opposition Members who are standing up for small businesses. Small businesses are the backbone of my local economy in Broxbourne and the country at large. If we do not ensure a fair balance between workers and small businesses, small businesses will close and people will lose their jobs. I do not think the Government want that, so will they please reflect on the Bill, have a proper consultation and come back with something more suitable for small and medium-sized businesses across the country?
Apsana Begum (Poplar and Limehouse) (Ind)
I rise to speak as a proud trade unionist. I draw the House’s attention to my entry in the Register of Members’ Financial Interests.
Too many people are in jobs that offer little or no security. My constituency casework has highlighted the reality of insecure work in the UK and has exposed the inadequacy of the law around worker protections. The rise of in-work poverty, workplace precarity, zero-hours contracts, bogus self-employment and contracting out puts workers at risk. We know that women and black, Asian and minority ethnic workers continue to face the disproportionate burden of working in insecure jobs with fewer rights and ongoing pay gaps.
After years of attacks on workers’ rights and hostility towards trade unions, it is a pleasure to welcome the Employment Rights Bill, which is without doubt a significant step forward for workers. I am particularly pleased to see the ballot thresholds from the Trade Union Act 2016 done away with, and to see the repeal of the Strikes (Minimum Service Levels) Act 2023, which trade unions have criticised as being undemocratic, unworkable and illegal.
I have long been concerned that current laws are already restricting the rights of workers to join and participate in trade unions and may breach international labour standards. Many of us would have liked to see the Bill completely ending fire and rehire and zero-hours contracts once and for all. I also understand that some unions are concerned about the rules allowing workers to have access to trade unions. They argue that the single best way to ensure that work pays more fairly is by expanding collective bargaining. I remain committed to strengthening trade union rights across the board.
I listened carefully to the Deputy Prime Minister, who rightly raised the plight of carers and parents in relation to employment rights. I would also like to raise the plight of survivors of domestic abuse and violence. The statutory guidance on the Domestic Abuse Act 2021 reminds us how pivotal the role and actions of an employer can be in the life of a survivor, who might only speak to managers and colleagues outside the home, as I know only too well as a survivor of ongoing abuse and harassment and having spoken to countless survivors. Employers should have a duty of care towards employees who are experiencing domestic abuse. I believe that the Bill could be further strengthened by bringing into scope the experiences of survivors of domestic abuse in the workplace. We should look at provisions such as flexible working and paid leave in that regard.
A thriving and just economy cannot be created without the full involvement and empowerment of the workforce. The Bill is an opportunity to lay the groundwork for a future in which workers can defend their pay, dignity and working conditions.
John Cooper (Dumfries and Galloway) (Con)
We have heard some electrifying and remarkable maiden speeches today. I rise to speak as a former member of a trade union. I do not miss the subs going out of my pay packet; it did little for me. This is no mere Bill, but a time machine that could take the whole country back decades. The unions are gonna party like it’s 1979. For your benefit, Madam Deputy Speaker—you were not there—1979 was the winter of discontent when the unions bit back, the rubbish piled high in the streets and a Labour PM was soon out with the bins.
With this hastily assembled Employment Rights Bill, Labour is feeding the union alligator that may yet eat it, too. That is because the Bill lacks balance, assuming that all employers are robber barons intent on exploiting workers. The Prime Minister has talked of growing the economy and cutting red tape, yet now we see the reality: proposals that will frighten firms away from taking on new staff and burden them with still more rules and regulations.
My constituent Rory, a forward-thinking dairy farmer, has written to me about Labour’s pledge
“to make Britain the best place to start and grow a business.”
Like me, he sees fine sentiments, but the Bill risks the opposite effect. There is even an expensive new layer of bureaucracy: the fair work agency, whose costs will be borne by business and passed on to the public. The people’s tape is deepest red.
The Bill makes it easier for militant unions to infiltrate workplaces, and it strips out sensible curbs on their power. Strikes will hit the public harder without Conservative safeguards such as those that guarantee minimum service levels. An impact assessment of the Trade Union Act 2016 indicated that it would cut strikes by about 35%.
John Cooper
No, I have waited 40 years for this. Much of the 2016 Act will be tossed into picket line braziers, and as ever it is the public who will suffer. The plan to make union funding of Labour opt-out, not opt-in, is another back-to-the-future move. It is naked opportunism from the Labour party.
The Bill will be hardest on small and medium-sized businesses, the backbone of the economy. We must not forget that they are run by people who are themselves workers and strivers. Napoleon disparagingly called us a nation of shopkeepers. With legislation as skewed as this, Labour risks shutting the shops and turning us into a nation of strikers and their union rep handmaidens. This skimpy Bill is so heavily skewed that it resembles the blade in Edgar Allan Poe’s “The Pit and the Pendulum”, leaving employers strapped in red tape between the ever-present pit of insolvency and the slice, slice, slice of costly, pro-union, anti-growth legislation.
Madam Deputy Speaker (Caroline Nokes)
I call Lorraine Beavers to make her maiden speech.
Lorraine Beavers (Blackpool North and Fleetwood) (Lab)
I congratulate all Members who have made their maiden speech today. I am a proud member of Unite the Union and the Communication Workers Union.
I would first like to pay tribute to my predecessor Paul Maynard. Paul worked incredibly hard for his constituents and was rightly proud to be the first person with cerebral palsy to become a Government Minister. I want to say thank you to Joan Humble, the first Labour MP to serve in my constituency, and to my hon. Friend the Member for Lancaster and Wyre (Cat Smith) for all her hard work and commitment to the people of Fleetwood. I also want to pay tribute to my mum and dad, the wonderful Ronnie and Brenda Shewan, who both sadly passed away this year. My dad saw me get selected, and my mum saw me get elected. Oh, how I miss them!
As a lifelong trade unionist and socialist, I am incredibly proud to be making my maiden speech on the Employment Rights Bill, which will be transformative for the working people I represent. The 16-year-old me began her journey in the labour movement at Larkholme high school in Fleetwood. In assembly one day, the headmaster asked if anyone’s dad was a lorry driver, and a girl called Susan raised her hand. He asked whether her dad had gone to work that day. When she said no, the head informed the school that the reason they did not get their cornflakes that morning was that Susan’s dad was refusing to go to work. I was incensed. I organised a demonstration outside the school gates that very lunchtime. The head was furious and demanded that we come back in, but we stood united and refused. Eventually we negotiated a deal, agreeing that the head would make a full apology at the next school assembly.
I understand that the Bill might not allow for picket lines inside schools, but without doubt it is the biggest upgrade to workers’ rights that we have seen for a generation. The fair pay agreement outlined in it will be transformative for the working people of my constituency, especially in social care, where low pay and poor conditions have led to a recruitment and retention crisis. With an end to fire and rehire, a clampdown on zero-hours contracts and more rights for unions to represent working people, the Bill will not just improve the lives of my constituents, but empower them.
It is an honour and a privilege to be the voice of the residents of Blackpool North and Fleetwood. I am the 15-year-old girl who brought the school out on strike. I am the Army wife. I am the mum who could not afford to buy new shoes for her girls. I am the mum who cycled an extra mile to save 50p because funds were low. I understand what it is like to be poor and struggle between paydays. Sadly, I know that some of my constituents are going through far worse poverty than I could ever imagine. I see the cost of living crisis, the massive rises in rent, food and clothing and the mortgages that young people can only dream of affording, and I want to make it better.
My constituency has the most beautiful coastline, nature reserves and communities. We speak to each other, we care for each other, we smile at each other and we look after each other. That is why so many people move to the Fylde coast. It is where I live with my husband John and where we brought up our two beautiful daughters, who have blessed us with four wonderful grandchildren. I would not live anywhere else but on the beautiful Fylde coast. It is where I am from, where I was born and where I have loved, laughed, worked, cried and grieved. It is my home and my safe space.
My constituency includes the towns, villages and hamlets of Fleetwood, Thornton, Cleveleys, Stanah, Anchorsholme, Carleton, Norcross, Norbreck, Bispham, Little Bispham and northern Blackpool. Carleton is listed in the 1086 Domesday book. Bispham is several hundred years older than Blackpool, and Fleetwood is the newest kid on the block, with the first bricks not being laid till 1836. I will serve every corner of my constituency and fight for a better future for all. I am here to fight for investment into my community, to fight for my constituents and to make sure that the funding my constituency so desperately needs is brought back home. That is the job my constituents sent me to do, and I intend to do it.
I am proud to have been elected alongside a Government who will deliver dentists for all, save our NHS and invest in our young and old alike; a Government who will invest in our communities, our armed forces, our police, our firefighters and more; a Government who care and leave no one behind; and a Government who make those with the broadest shoulders carry the heaviest load. This is my Government, this is my party, and we will deliver.
Steve Darling (Torbay) (LD)
I congratulate the hon. Member for Blackpool North and Fleetwood (Lorraine Beavers) on a powerful maiden speech. I broadly welcome the Bill before us—after all, it is clearing up the mess left by the previous Tory Government. However, I am concerned that the Government are not going far enough in certain areas, particularly on statutory sick pay. Presenteeism may mean that people are turning up to work when they should not be, both for their health and for productivity. It is important to enhance statutory sick pay, and I hope that Ministers will give it serious consideration.
As somebody who was adopted, I am delighted that the Bill talks about adoption, but I am shocked that the Government have not explored how they could support fostering. It is part of the rich tapestry of our families and our society in the United Kingdom, and it also helps our children’s services. Why are the Government choosing to be wilfully blind to foster carers in the Bill? It is shameful.
I would also like to reflect on Disability Confident employers. Disability Confident is a really important scheme. We know—I hear it on the news—that the Government are talking about trying to get people with health conditions out of benefits and into work. We applaud that, but why is the Bill silent on Disability Confident employers? This is a real opportunity to do things in a positive way, rather than blaming people with disabilities. I hope the Government will see common sense on that.
Ian Lavery (Blyth and Ashington) (Lab)
I refer the House to my declaration of interests.
The Employment Rights Bill is most welcome. It has been described by some on the Conservative Benches as a horror show. It is definitely not a horror show. It is described as a trade union Bill. I remind Opposition Members that it was the Conservative Government who introduced the Trade Union Act 2016, among many other anti-trade union pieces of legislation. One of the best things in this Bill is the repeal of much of what was in the 2016 anti-trade union legislation. This is the first time in my time as a Member of Parliament that there has been any repeal of anti-trade union legislation. I have to say that, like many other trade unionists and many other people in the workplace, I welcome that fact. Labour recognises that the relentless attacks on the trade union movement—the battering of ordinary working people from pillar to post—cannot and should not continue.
Andy McDonald
Does my hon. Friend agree that the Strikes (Minimum Service Levels) Act 2023 was a deliberate attempt to undermine people in the workplace? It was completely ignorant of the fact that the unions provide minimum service levels throughout some of the most difficult circumstances. Does that not tell us a lot about the previous Conservative Government?
Ian Lavery
Thanks for that intervention. Of course it says a lot about the previous Conservative Government. We on the Labour Benches should always remember and never forget what the Conservatives do whenever they are cornered or in difficulty: they revert to type and attack the trade union movement. That is what they do and have always done. You have seen some of the contributions here this evening. [Interruption.] Do you want to intervene? [Interruption.] Oh, so are you just going to continue to chunter? And when I give the opportunity of saying something responsible—
Madam Deputy Speaker (Caroline Nokes)
Order. The hon. Gentleman can sit. He has been here long enough to know that when he says “you”, he is referring to me. I sometimes let it pass when it is new Members who are not quite used to it, but he should know better.
Ian Lavery
My apologies, Madam Deputy Speaker. Yes, you are right, I should. I was being chuntered at by a Member on the Opposition Front Bench. My deepest apologies.
As I say, we must remember that the Conservatives revert to type.
Suella Braverman (Fareham and Waterlooville) (Con)
The hon. Gentleman is doing a very impressive impersonation of Arthur Scargill. The reality is that the Conservative Government left office with 4 million more people in work compared with the Labour inheritance, a growing economy and a smashed deficit. That is something we are proud of on this side of the House.
Ian Lavery
Thanks for the compliment.
I was saying that the Bill simply restores the balance. It seeks to reverse the injustice meted out to the trade unions and working people, and to rebuild the workplace that was ideologically destroyed by the Conservative Government. These are the first steps and they are so, so welcome. I have fought for them all my life. They are the first steps in a long journey, but look at what we have done within the first 100 days. I have only mentioned a few.
As my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald) says, we are repealing the minimum service levels laws and most of the Trade Union Act 2016, and ensuring that individuals have employment rights from day one, including sickness pay, although there is an argument that sickness pay is far too low. We are looking at bereavement payments and so on from day one. We are looking to address the scourge of zero-hours contracts. We are looking to address the scourge of fire and rehire. We are looking to introduce flexible working and entitlements to paternity and parental leave. We do this because it is the right thing.
I could spend hours outlining what I think is right in the Bill and perhaps some things we need to focus on in the coming weeks, but I will not do that. The reality is that this is a historic Bill that sets a framework for fairness for generations to come. Remember, the louder the screams from the Conservative party—the screaming, shouting and chuntering—the more we on the Labour Benches know that we are winning the argument. We know we are doing the right thing, so however loud you shout, we welcome it.
Bradley Thomas (Bromsgrove) (Con)
I congratulate those hon. Members who delivered their passionate and authentic maiden speeches today.
I am proud, like so many Members, to represent a constituency that is home to so many small and medium-sized businesses, which comprise the backbone of our local economy. I am deeply concerned that the reforms in the Bill will hurt both businesses and employees, as well as damage the economic growth that the Government claim to be striving for. The previous Government introduced and raised the national living wage, ending low pay and ensuring that work always pays more than benefits. They banned exclusivity clauses in zero-hours contracts, banning businesses from stopping workers on a zero-hours contract having another job, and delivered 800 jobs a day from 2010. The Conservative Government also introduced shared parental leave, giving more choice to families. We introduced new regulations on shared parental leave to give families more choice over how they take parental leave following the birth of a child.
Changes to business regulation need to strike a careful balance, but Labour’s Bill gets it wrong and will instead make it harder for businesses, damaging job creation and economic growth in the process. The Labour party has introduced a Bill at pace that does not strike the correct balance. As a result, our economy will be less competitive and growth will be hindered. Those warnings come not just from the Conservative Benches, but from across industry. The Scottish Chambers of Commerce highlighted how
“The proposed new rights to a tribunal access from day one will inevitably lead to more settlement agreements to avoid a lengthy and costly tribunal process, placing more burdens on businesses.”
The changes to employment law risk “fuelling long, complex litigation”, according the Recruitment and Employment Confederation.
There are a few parts of the new Bill to which I would like to draw attention. The likelihood of drawn-out dismissal processes has already been referred to. There is the question of how poor performance will be proved. There is the unnecessary right that will be given to trade unions to gain access to workplaces. On zero-hours contracts, many employers and employees do not want guaranteed hours and a minimum threshold. On flexible working, there is the material change proposal, a reasonableness test that will make—
Suella Braverman
My hon. Friend is making a very good speech highlighting the fatal flaws in the Bill. Does he agree that the Government’s own impact assessment on the economic implications show that it will be a disaster for small businesses, not just in Bromsgrove but in Fareham and Waterlooville? The costs that will be borne by businesses will cripple investment, strangle job creation and further stagnate growth.
Bradley Thomas
I thank my right hon. and learned Friend for her intervention and agree wholeheartedly with her points. The Bill will inhibit economic growth and ultimately bear down very heavily on those the Government claim they are trying to protect.
The reforms will prevent businesses from hiring new people and expanding. The Institute of Directors has warned that 57% of businesses are less likely to hire due to measures in the Bill. There are concerns that the Government have not carried out a consultation on collective redundancy, and have failed to outline why they view those proposals as beneficial. Make UK, an important industry body, has warned that the regulations will “significantly increase” red tape for businesses that are forced to make redundancies, and UKHospitality, which represents thousands of businesses on which many of our constituencies rely for their economic vitality, has said that for 90% of workers on zero-hours contracts, those are the desired contracts for them.
What we see here is a generational shift in employment law that will ramp up grievances and disputes and entrench unproductivity. As my right hon. and learned Friend the Member for Fareham and Waterlooville (Suella Braverman), pointed out, it will make it easier to strike and send us back to the 1970s, supporting militant unions. It will increase the number of strike hours in public service, and, as Unite the Union has pointed out, it is like Swiss cheese: full of holes. I hope that, as the Bill progresses through Parliament, the Government will listen to both the Opposition and industry in order to limit the damage it will cause businesses and working people.
Catherine Atkinson (Derby North) (Lab)
I congratulate the Deputy Prime Minister on introducing this groundbreaking Bill within the Government’s first 100 days. It is a careful product of many years of work and thought. I proudly declare the interests set out in the Register of Members’ Financial Interests, including my position as chair of the Society of Labour Lawyers, which has considered and campaigned on these issues for years. The many measures in the Bill create the conditions for jobs around which people can build lives and families, and will prevent legitimate businesses from being undercut by those who avoid their responsibilities. I welcome the provisions to tackle exploitative hiring and employment practices, which will benefit workers and businesses.
I will confine my remarks to enforcement and the fair work agency, because a right is not worth the paper it is written on unless it can be enforced. I was a barrister for 17 years, and for part of my career I had the honour of representing working people. I saw at first hand the race to the bottom on employment that took place under the last Government. Our country is unusual in having no labour rights commissioner, or central or local regulator. Many of the rights that successive Labour Governments have established, and for which the wider Labour movement campaigned, are instead delegated to individuals required to act themselves through the employment tribunal system.
As the Low Pay Commission has found, low-paid and exploited workers can be reluctant to speak out about abuses of their rights. Regulation of the labour market in the UK is fragmented and under-resourced, with an estimated one inspector per 10,000 workers. The creation of a fair work agency will help to enable enforcement of the national minimum wage, statutory sick pay, and a wider range of rights such as holiday pay, so that everyone plays by the same rules. It will help to protect businesses that are undercut by acting as a real deterrent. The current system clearly does not do that: last year 1.1 million employees did not receive any of the paid holiday to which they were entitled, and one in five of those on the minimum wage do not receive the correct pay. It is to the Government’s credit that the fair work agency will help the most vulnerable workers, including those who are victims of human trafficking. I hope that, as the Bill progresses, we will be able to consider whether the agency will also be able to help with safety and other workplace rights.
We have seen Conservative Governments provoke conflict and disruption in industrial relations, but growth and prosperity are only served by better co-operation and work practices, and that is what the Bill will deliver.
Wendy Chamberlain (North East Fife) (LD)
I rise not to speak about the Bill as a whole, but to focus on the provisions that will have an impact on unpaid carers. I refer to my entry in the Register of Members’ Financial Interests as a trustee of the Links Trust. I am to become a member of the board of the Fife Carers Centre, which supports unpaid carers across Fife including my constituency, and that will shortly be published in the register. It should therefore be no surprise to the Government that the first issue that I want to raise is their failure to include paid carer’s leave in the Bill, or even to commit themselves to it in their “Next Steps to Make Work Pay” document. I think that that is a mistake, and also a U-turn from their previous position. I remember that during a debate on my private Member’s Bill that became the Carer’s Leave Act 2023—I double-checked this in Hansard—the hon. Member for Bradford East (Imran Hussain), who was then shadow Minister for employment rights and who is no longer in the Chamber, said:
“We of course support the Bill, but it falls short of what unpaid carers really need, which is paid carer’s leave. Under the proposals set out in our new deal for working people, the next Labour Government will legislate to introduce just that”.—[Official Report, 21 October 2022; Vol. 720, c. 1004.]
Indeed, he committed himself to doing that at all subsequent stages.
I acknowledge that the “Next Steps” document does make some promises in relation to carer’s leave—both to review the operation of the 2023 Act that I was proud to pass, and to look at the benefits of making that leave paid—but that is it. I looked with excitement at today’s written statement—I do not know what that says about me—only to find four consultations, none of which referred to unpaid carers. My Liberal Democrat colleagues and I are calling on the Government to give certainty to unpaid carers: certainty about when that review will take place, certainty about what it will entail, and certainty that the Government are keeping their pre-election pledges to move forward with paid leave.
Will the Government provide an update on what is being done to inform businesses about carer’s leave as it stands, namely unpaid? It concerns me that there is not enough information out there for employers or workers. What are the Government doing to ensure that companies are passing the information to their employees, and that it is being recorded correctly in systems? That last point is important. If the Government want to review the operation of the current Carer’s Leave Act, presumably they will want to know about take-up, but I am hearing worrying stories that carer’s leave cannot be properly recorded in HR systems, and is therefore recorded as general unpaid leave or something similar. We do not need to wait for a review to ensure that the new leave continues to be rolled out properly and effectively.
There are other elements of the Bill that I welcome, especially those relating to flexible working. We know that for unpaid carers, flexible working can be one of the most important tools for staying in work. My request of the Government is that during the passage of the Bill, they flesh out a bit more what they mean by a reasonable or not reasonable rejection of a request for flexible working. I urge the Minister to use his time today to reassure unpaid carers that the Government are not turning their back on them, now that he is in a position to help them.
Paul Davies (Colne Valley) (Lab)
Let me begin by proudly declaring my membership of Unite, the GMB and the Community trade union, and at some time in the past, a member of the National Union of Mineworkers, like my hon. Friend the Member for Blyth and Ashington (Ian Lavery).
The Bill will transform the lives of workers across the United Kingdom. It is not just a set of reforms; it is a commitment to the hard-working people of this nation, a promise to ensure that their rights are protected and their voices are heard. For far too long, many workers in this country have endured poor working conditions, low pay, and a lack of job security. The previous Conservative Government failed to address these critical issues, leaving millions of workers vulnerable and undervalued. The Bill is the Government’s response to these injustices. It is a comprehensive package of reforms designed to upgrade workers’ rights, tackle poor working conditions, and benefit both businesses and workers. It is part of the Government’s broader effort to deliver economic security and growth to businesses, workers and communities.
One of the key aspects of the Bill is the improvement of pay and productivity. We recognise that fair wages are essential to the wellbeing of workers and their families. The Conservative Government’s policies led to stagnating wages and widening income inequality. The Bill aims to rectify that by ensuring that all workers in the UK are paid fairly for their hard work, and that businesses are incentivised to invest in their workforce. From my conversations with businesses and employees in my constituency, it is clear that fostering sustainable businesses and promoting growth are crucial. I have observed numerous businesses forming partnerships with their workforces, grounded in fair treatment that acknowledges employees’ dedication and hard work. The Bill supports and strengthens that approach. It also represents a new approach, a pro-business, pro-worker strategy that recognises the connection between economic growth and workers’ rights. By addressing issues such as poor working conditions and low pay, this Government aim to create a more balanced and sustainable economy.
The Bill is a testament to the Government’s commitment to creating a fairer and more equitable society. I am proud to support it, and to stand up for the rights of workers in my constituency and beyond.
Ellie Chowns (North Herefordshire) (Green)
I begin by welcoming this Bill on behalf of my Green colleagues. I would like to gently comment on the tone of some of this debate. I find myself on the Opposition Benches, but that is not to say that I share the sentiments expressed by Conservative Members. In particular, it is a shame that we have seen some very polarised debate today. I want to challenge the rhetoric of, “It’s workers versus employers and unions versus small businesses.” That is both ahistorical and economically illiterate, frankly. It is ahistorical because if we did not have workers organising together to improve their conditions, we would still have children up chimneys and women being paid a small fraction of what men are paid for doing the same work.
Such rhetoric is economically illiterate because inequality is bad for growth. It is not just me and Labour Members who say that; the International Monetary Fund has specified that inequality is bad for growth. Let us try to look for the common ground together, and to welcome measures that will improve work and the security of people who work. Let us recognise that, frankly, this Bill is long overdue, because we have seen the erosion of workers’ rights over decades. We are now in a position where work does not pay well enough for far too many people in our country, which is why we have so many people on in-work benefits.
I really welcome the sentiments expressed by the right hon. Member for Hayes and Harlington (John McDonnell), who pointed out that there are much better labour relations in countries where there is a positive recognition that workers’ rights go along with improved economic growth. As a country, let us try to move towards that point.
I want to briefly mention a few areas where I would like the Government to go further. The Bill’s failure to fully ban fire and rehire practices is inexplicable. It leaves a loophole or get-out clause that effectively condones this practice, and I do not think there can be any grounds for treating workers in purely transactional terms.
Zero-hours contracts are a complex area. I know that some people welcome the opportunity to have zero-hours contracts, but this flies in the face of what the majority of the public wants. The current model leaves far too much power in the hands of employers.
I want to briefly mention other aspects of equality. It is disappointing that this Bill does not uphold previous Labour pledges on mandatory disability and ethnicity pay gap reporting. It will lead to increased inequality between migrant workers and others, because it does not address the risks that migrant workers face when their visas are dependent on employers, and they may exit the country before they have had a chance to pursue their employment claims.
I would like to see kinship care treated in the same way as adoption leave. The hon. Member for Torbay (Steve Darling) talked about foster carers, too.
In summary, I welcome this bill, but there are areas where I would like to see the Government go further to protect workers’ rights.
Mike Tapp (Dover and Deal) (Lab)
It is an immense privilege to be here today as the Member of Parliament for Dover and Deal. I refer the House to my entry in the Register of Members’ Financial Interests: I am a proud small business owner and a union member, and it is fantastic to see so many Labour Members who are small business owners speaking in support of the Bill.
Over the past two years, I have knocked on thousands of doors, spoken to families, business owners and workers, and listened to their hopes and concerns. Today, I bring their voice to this House, but first I pay tribute to my predecessor, who was and still is an ardent champion on housing issues. Before the general election, she sent a clear message to the country when she crossed the Floor of the House to join the Labour party.
Dover and Deal is the gateway to Britain, with our port bringing £144 billion of trade into the country, but it is also a place rich in history, resilience and community spirit. From the iconic white cliffs to the finest castle in Britain, and from the newly reopened Roman painted house to the proud former mining communities in Aylesham, Snowdon and Betteshanger, we represent the very best of what it means to be British. We also have beautiful coastal paths with some truly great pub stops along the way, as Members have probably seen from my social media; they include the King’s Head and the Forresters in Deal, the Zetland Arms in Kingsdown and Cullins Yard in Dover. We have castles in Dover, Walmer and Deal. I wonder whether my constituency has the most castles in the country, but I am open to challenge on that.
My commitment to public service and hard work stems well and truly from my upbringing. One grandad flew the Catalina flying boats that took out Nazi submarines, and then went on to sell Colman’s mustard from Cambridge. The other grandad was a lifelong, distinguished Royal Mail worker, and that generation’s unwavering spirit of hard work runs through my family. My father, a dedicated police officer, and my mother, a social worker, showed me that real service is about standing strong for others. Their steadfast dedication to helping those in need taught me that strength is found not in titles, but in the service we provide to those around us. That lesson has guided me in my own life—in the Army, in a counter-terror role at the National Crime Agency, and now as the proud Member of Parliament for Dover and Deal.
But I do not stand here alone. I pay tribute to my wife—my hero—who came from Estonia at just 18 years of age, 16 years ago. She has always been and will always be my rock, having supported me through a very difficult and long campaign. Linda has shown remarkable resilience and dedication in turning her passion for dogs into her own thriving small business, which will continue to thrive and grow under this new Bill. We have two dogs of our own. Some of you will know Scooby from the campaign trail. He has become so famous that my Wikipedia page simply states:
“Personal life: He has a dog called Scooby.”
I assure you that I have more of a personal life than that—and a second dog, a puggle called Monki.
It is no secret that I am just a little bit patriotic. When you represent Dover and Deal, how could you not be? For centuries, we have stood strong against invaders and threats, from Napoleon to the Nazis. Dover and Deal has always been at the heart of Britain’s story, and I am committed to ensuring that we remain a proud and prosperous part of the country’s future. Dover and Deal is where national challenges meet local reality. We are a community on the frontline of issues such as border security, immigration and trade. We face these challenges with the strength and sense of duty that has always defined us. Under this Government, Dover and Deal will be treated with the respect it deserves. My vision is for a Dover and Deal where our community can thrive, with improved infrastructure, stronger public services and more opportunities for young people to build their futures there. We are more than a point of transit; we are a community of hard-working people who keep our port running, our businesses thriving and our public services going.
As we debate the future of workers’ rights, I want to say on record that the P&O Ferries scandal, which affected so many of my constituents, must never be repeated. That is why I fully support this Bill.
Nick Timothy (West Suffolk) (Con)
I congratulate the hon. Member for Dover and Deal (Mike Tapp) on his maiden speech. I look forward to the best dog in the world, Monty, taking on Scooby in the Westminster dog of the year competition.
Everybody in the House knows that every Labour Government in history have ended with unemployment higher than when they started. Bills like this are part of the reason why, whatever the intention. If the purpose of this Bill really is to improve workers’ rights, and it is not just about paying back £40 million of union donations made over the past few years, why is there no provision addressing one of the worst labour market abuses in our country: substitution clauses, which allow delivery drivers to lend their identities to others? These clauses are in contracts from huge firms such as Amazon and Deliveroo, and they fuel worker exploitation and immigration crime. We know that hundreds of thousands of people, many of whom cannot work here legally, trade identities. By undercutting British workers and exploiting those with no right to be here, these companies are privatising profits and socialising the costs that they cause, so why is that issue missing from the Bill?
Why will the Government do nothing about the international trading system? Countries aiming to run trade surpluses, such as China, hold down their labour costs and destroy industry in deficit countries such as ours. Trade wars, as two authors like to say, are class wars, and the Labour party usually likes to fight a class war, yet this Government want to flood Britain with cheap Chinese electric cars because of the Energy Secretary’s obsession with net zero. That is just one way in which our economic model needs to change, because while the Government’s characterisation of their inheritance is, I am afraid, cynical and wrong, there is a case for economic change, if only the Government were prepared to undertake it. I think the Business Secretary might be one of those capable of doing that, but I am not sure that some of his colleagues are. Today, Ministers could be launching a plan for reindustrialisation, for competitive energy prices, for domestic steel manufacturing and for a strategy taking in better infrastructure, skills and training, planning, regulatory reform and more—[Interruption.] Would the hon. Lady like to intervene?
Nick Timothy
The Government could be doing something about the fact that nearly 22% of the workforce is economically inactive and a record number of men is leaving the labour market. They could be backing British business.
Robbie Moore
This again highlights the point that there is so much detail yet to be released into the public domain about this Bill. I highlighted this before. Does my hon. Friend agree that if we had that detail, we could provide more reassurance to the small and larger businesses dealing with the challenges he has mentioned?
Nick Timothy
My hon. Friend is exactly right; I agree.
The Government could be backing British business, not burdening it with all these new regulations. Instead, we have an Energy Secretary driving up energy prices, a Chancellor planning a jobs tax, increases to capital gains tax and the imposition of inheritance tax on small family businesses, and a Deputy Prime Minister reregulating the labour market at a cost to business of £5 billion, to pay back the unions who fund the Labour party. The Prime Minister promised us that his priority was “growth, growth, growth”, but like everything else he said before the election, he did not mean it, because the only three things that this Bill will bring are more costs, less investment and fewer jobs.
Peter Swallow (Bracknell) (Lab)
Let me start by proudly declaring that, like 1.3 million working Brits, I am a member of Unison. Bracknell is a fantastic place to do business, and since my election I have spoken to plenty of businesses in my community, from SMEs to international businesses. In speaking with them, two things have come out time and again. First, there is relief that they finally have a Government who will put economic stability at the heart of everything they do, instead of chaos. Secondly, there is recognition that the Bill will be good not only for their workers but for businesses, because well supported staff who have more control over their lives and more reliable hours will work harder and for longer.
Workers who can adjust their terms, who are free from the threat of dismissal right after starting a family, who are entitled to leave after a loved one’s death, who are given the time to recover when they are sick, who no longer face exploitative zero-hours contracts or fire and rehire, and who are free from harassment are obviously happier and more committed. Indeed, many Bracknell businesses already offer many of the rights in this Bill, because they recognise that doing so makes them more attractive to good, skilled workers.
This Government are pro-business, pro-growth and pro-worker, and this Bill demonstrates that commitment. I note that the chief executive officer of the CBI, Rain Newton-Smith, has said:
“The government deserves credit for its willingness to engage with businesses and unions”.
There is a body of economic research that substantiates what we all feel to be true: workers’ rights are the foundations of a resilient, growing economy.
Nick Timothy
The hon. Gentleman just quoted the CBI approvingly. Can he name the chief executive of a real business who approves of this Bill?
Peter Swallow
I have spoken to many chief executives in my constituency who approve of this Bill. I will not go into private conversations, because I have not warned them that I was about to quote them in the House, but I am sure that we will hear many such examples in contributions from other Members.
This Bill will bring in historic new rights for working people. It will make work pay, and it will be good for boosting our national productivity and supporting businesses and growth in this country, because we all know that when workers feel that the jobs that they do are valued, they contribute more to the economy. That is why this Bill is good not only for workers but for businesses.
Alison Bennett (Mid Sussex) (LD)
I associate myself with the comments of my hon. Friend the Member for North East Fife (Wendy Chamberlain), and commend her for all her work on the Carer’s Leave Act 2023, which came into play in the previous Parliament. I want to build on that, and to emphasise the importance of the interplay of paid and unpaid care in ensuring that we look after the people in society who need our care. The comments of a constituent of mine in Mid Sussex come to mind. She was an unpaid carer for her mother, and told me that having paid carers come in helped her to sustain a normal mother-daughter relationship for that little bit longer.
The care workforce, and looking after the care workforce, are extremely important, and the Liberal Democrats welcome the fair pay proposals in this Bill, but we would like the Bill to go further. As I mentioned when I intervened on the Deputy Prime Minister, we would like the minimum wage for care workers to be £2 higher than the normal minimum wage. We would also like to build the esteem and career path of people who work in paid care—for example, by establishing a royal college of carers. Without that, we have a blocker to our workforce productivity. Caring and working must go hand in hand, but because regulations do not enable unpaid carers to look after their loved ones adequately, 600 people a day give up work to care for a loved one.
One of those people is Amanda, who used to live in Mid Sussex. She and her husband Nick look after their 21-year-old son Archie, who is autistic and learning disabled. Amanda is a modern foreign languages teacher, and there is a shortage of such teachers. As Archie was approaching adulthood, they realised that West Sussex county council would not be able to provide enough care for him, so the best thing that she could do was take her teacher’s pension early and claim the carer’s allowance. Because of the £151 a week limit on earnings for those on the carer’s allowance, Amanda is now excluded from the workforce. She cannot take up offers of supply teaching or exam invigilating that would boost the family income and be good for her mental health. We need to ensure that people can give care while being in the workforce, because this situation is not good for the nation’s productivity, or for the Government’s ambition to deliver growth.
Madam Deputy Speaker (Caroline Nokes)
I call Kenneth Stevenson to make his maiden speech.
Kenneth Stevenson (Airdrie and Shotts) (Lab)
It is a great pleasure to follow the maiden speech of my hon. Friend the Member for Dover and Deal (Mike Tapp), and the excellent maiden speeches of the hon. Members for Leicester East (Shivani Raja) and for Weald of Kent (Katie Lam), and my hon. Friends the Members for Hyndburn (Sarah Smith), for Penistone and Stocksbridge (Dr Tidball) and for Blackpool North and Fleetwood (Lorraine Beavers).
I make my maiden speech with a great deal of pride. Serving the people of Airdrie and Shotts is an immense privilege, and one that I will never take for granted. I hope that my dad, Howard, will be pleased as he watches at home, and that he knows that it is the value of hard work that he and my mum, Millie, instilled in me—along with the assistance of many others, including my wife, Julie, who is watching here today—that has brought me to this place.
The opportunity for me to make my maiden speech today is all the more special because we are debating the Employment Rights Bill. As we chapped doors across the constituency for over a year, our key commitment was to deliver an upgrade to workers’ rights the like of which has not been seen for a generation. I am delighted that we are making such rapid progress, and I thank the Minister and the Government for putting this at the forefront of our efforts to give Britain back its future. I look forward to seeing the impact of this Bill on workers in my constituency of Airdrie and Shotts, and across the country.
I pay tribute to my immediate predecessor, Anum Qaisar. I never questioned her commitment to the job she was elected to do, nor to the causes for which she fought so passionately. I wish her well in the future.
Looking back a bit further into the history of the Airdrie and Shotts constituency, and of the seats that came before it, I have to mention some of the giants who have served these communities. From Jennie Lee, a key figure in the creation of the Open University, where I obtained my qualification, to Peggy Herbison, a Shotts woman to her core, who led the way for women in politics and whose impact is still felt in Shotts to this day; and from John Reid, a pivotal figure in the last UK Labour Government, to John Smith, a truly excellent leader of my party, taken before his time, who put the Labour party firmly back on the path towards Government. Although, on reflection, I may be making a rod for my own back by mentioning such influential and consequential figures, it is only right that I recognise their contributions to this place, to the communities I now represent, to the Labour movement and, indeed, to this country.
Members will be surprised to hear this, but I am going to make a comparison between Airdrie and the ancient city of Rome—before Members ask, it is not the weather. Like Airdrie, Rome is also built on seven hills. A popular Airdrie pub quiz question is to name them, but I will not attempt to do so today, because of the risk of missing one out—what a start that would be!
The communities of Airdrie and Shotts, along with the many surrounding villages, are steeped in industrial history. These towns and villages, including Harthill, Eastfield, Salsburgh, Allanton, Bonkle, Hareshaw, Hartwood, Morningside, Cleland, Holytown, Newarthill, Newmains, Plains, Chapelhall, Gartness, Calderbank, Glenmavis, Caldercruix, Upperton, Longriggend, Wattston and Greengairs, are of great importance to the history of Scotland and the wider UK.
In coalmining, manufacturing, textiles, engineering and pharmaceuticals, the communities of Airdrie and Shotts have been home to skilled employment, and they have been at the centre of the various advances we have witnessed in previous decades. In fact, I completed my apprenticeship at a modern manufacturing facility in Shotts that was sadly closed during the times of rapid deindustrialisation. It was there that I learned my trade as an engineer and grew as a person. The advice of ex-miners, steel workers and foundry workers was invaluable. My second career as a lecturer at Anniesland college was informed by the people of Glasgow. I learned so much from my fellow lecturers and from the area’s students.
The Shotts factory humour is not generally something I would repeat in this Chamber, but I can share the first piece of advice I got as an apprentice: “Never argue with anybody stupider than yersel, son.” Oscar Wilde, it was not, and having listened to the discourse in this place, I am sure I will not need that advice here. Regardless, I will forever be indebted to the people of the area I was born, raised and worked in. I hope that legislation such as the Bill we are debating today will reignite the industrial and technological potential that exists within these communities.
There are two things I could not go without mentioning in my maiden speech. The first is the groups and organisations at the heart of my constituency. My Scottish colleagues will be well aware of the work and impact of St Andrew’s hospice in Airdrie. Many, if not most, people in Lanarkshire will have a relative or a family friend who was cared for by the hospice, and will therefore know its incredible value.
It is an immense honour and privilege to serve these people and communities. In me, they have a Member of Parliament who has lived in the constituency throughout my life, who values its potential and who is determined to overcome the challenges it faces. I will do my best to abide by my Stane primary school motto, “Persevere”, and by my Calderhead high school motto, “Facta non verba”—deeds, not words.
Today’s debate on the Employment Rights Bill is a critical step towards delivering a long-overdue new deal for working people, and it will be the working people of Airdrie and Shotts who I have in mind throughout my time in this Parliament.
Robbie Moore (Keighley and Ilkley) (Con)
I congratulate the hon. Member for Airdrie and Shotts (Kenneth Stevenson) on his maiden speech. Knowing his constituency a little, I can guarantee that the weather is not the link between Airdrie and Rome. I congratulate him on taking his place in this House.
Today’s debate is deeply important, and it will have huge ramifications for businesses of all sizes across the country. Hiring new staff is a big moment for small businesses, like many in Keighley and Ilkley, and it comes with huge potential but also risk. That is why many businesses in my constituency have contacted me in advance of the introduction of this Bill to express their concerns about the proposals before us today.
At a time when we need to grow the economy, we do not need a Bill that the Federation of Small Businesses has described as
“rushed…clumsy, chaotic and poorly planned.”
It has to be noted that this Bill will have a disproportionately negative impact on smaller businesses compared with larger companies that have their own HR departments.
Simply put, Labour’s day one rights and other similar measures are worrying for many small businesses across the country. The Government have made this situation worse by adding clause after clause of clarification, exception, regulation and definition, in an attempt to micromanage every possible situation for businesses across the country. This has created a quagmire of regulatory jargon that small businesses will simply have to cope with, and they will not be able to cope. The fear of falling foul of these regulations has been made clear to me by many businesses in Keighley and Ilkley.
The Bill will also prevent the backbone of our economy from hiring staff, expanding and growing our economy. Even the Government’s own economic analysis stipulates that the risks are highest for workers with the weakest attachment to the labour market, such as low-paid workers, disabled workers and the youngest workers, who are still gaining the experience and skills they require.
Rebecca Harris
An SME in my constituency once found someone sleeping rough on its premises and offered them a job. Does my hon. Friend agree that, when this Bill is enacted, it is very unlikely that a business will go to such lengths to give someone that kind of break in future?
Robbie Moore
I absolutely agree. My hon. Friend highlights that this Bill will not give businesses the certainty and confidence to recruit individuals who need that little bit more experience to get into the job market. Indeed, the Government’s own analysis points to an unintended consequence:
“Where businesses cannot absorb the increase in labour costs, they may look to pass them onto workers by reducing expenditures that benefit workers (e.g. staff training) or scaling back future improvements to T&CS (e.g. wage growth).”
This is not a pro-growth Bill, and it is not even a pro-work Bill; it is a pro-union Bill. The Government have even said this themselves. Their plan to make work pay has referred to this Bill as an “Employment Rights Union Bill”. Perhaps that is because the Bill is chock full of changes to union regulation made by our previous Conservative Government—changes that were specifically designed to protect the public from the unscrupulous practices of the unions and their more militant members.
Minimum service provisions were introduced by the last Government specifically to protect the public from being caught in the crossfire between the unions and the Government—yet, by lifting those restrictions with this Bill, Labour is showing that it is more interested in appeasing its union bosses than in ensuring that minimum service is guaranteed throughout any dispute between the public sector and the Government.
Nick Timothy
Earlier, I asked the hon. Member for Bracknell (Peter Swallow) whether there are any business leaders who actually support the Bill. Is my hon. Friend aware of any?
Robbie Moore
I have spoken to and received correspondence from many businesses, both small and large, in my constituency, but not one gave the Bill their full backing. In fact, they raised concerns about the relationship between the employer and employee being tampered with by the Government.
One of the most unsurprising parts of the Bill is clause 48, in which the Government want to force union members to pay into the political fund of the union, unless they explicitly decide to opt out. No matter what views hon. Members may have about unions, this clause is simply not right; working people should not be paying into political funds without giving their prior consent, especially when that money ends up in the pockets of a political party. Having received over £29 million in donations from the unions, we know which political party that money will end up going to—the party in government; and all this from a self-proclaimed Government of supposed transparency. Every employment is different, every job is different and every circumstance is different, but this Bill fails to recognise that.
Mr James Frith (Bury North) (Lab)
I will start by offering some home truths to Opposition Members: someone can be both a member of a union and an employer. I am a proud member of GMB, which donated to my campaign, but I am also proud to have started my own business. I have been an employer, taken risk, and understand the balance of risk and reward. Throughout the debate, Conservative Members, who claim to represent the party of business, have made false representations that are out of date and out of kilter with the debate that we are leading, having been elected with the majority that we have. They are keen to talk among themselves, with their plans to end maternity rights and all the progress the Labour party has made sacrosanct in British law and the experience of work in our economy, but I urge them to look at the result of the election and understand the direction of travel: the Labour party is once again making progress in this country.
Today’s leap forward for workers’ rights sits alongside the Government’s No. 1 mission of economic growth—that is, done with the workers not to them. We will be more productive, protective and prosperous, pro-business and pro-worker. The Bill rejects the idea that justice and fairness in the workplace need to come with an arbitrary waiting period. Day one rights will capture headlines, but will not cause alarm for most employers. The hon. Member for West Suffolk (Nick Timothy) asked which chief executives support this provision. I met chief executives on Friday who told me that as leaders in their field, they already do much of what we are advocating—so I say to those on the Opposition Benches: get with the programme.
Labour has a proud record to recall again today, as we advance these new rights. We have a record of raising the floor and the horizon for workers’ rights, whether through securing maternity, paternity or foster care leave, introducing the minimum wage or ensuring bank holidays. Through a principled link with our trade unions, the Labour party has fought for and delivered rights that once seemed radical but are now woven into our national life and experiences of work. These very advances, initially opposed by the Tories, have now come to be seen as the very standard of how working life in this country should be, and I am all for it, Madam Deputy Speaker—with time to spare.
Jim Shannon (Strangford) (DUP)
As hon. Members may be aware, I am not a career politician. I worked as a pork delivery driver with Henry Denny’s, until I opened my own small business as a pork retailer. I worked from early morning, before I did my work for the council and then for the Northern Ireland Assembly. I employed staff members. I did the books as well as I could, then handed them to my accountant. I delivered to local businesses and shopped local. I understand what it is to be a part of small business; indeed, it was a microbusiness. I say respectfully to the Minister that I know I would have struggled to implement some of the things currently under discussion, so I remind hon. Members of the implications of the Bill on small and microbusinesses. The Northern Ireland statistics will show why I hold those concerns.
Microbusinesses in Northern Ireland are no different from those in the United Kingdom mainland. Employment law is mostly devolved, but much of the law in Northern Ireland follows the direction of what is passed in the House of Commons, which is why I want to make my comments in a constructive fashion. The fact is that most employers are not skilled at making changes. The changes made by the Bill and additional obligations on employers must be made clear, be cost-effective and not mean that they need to hire an HR consultant, which is simply out of the question.
For example, I recently heard about a case of a small business that had worked out holiday pay using the online Government calculator. An employee moved to another job and queried the holiday pay. The Labour Relations Agency has said, according to the employees’ representation, that the owner owes approximately £800 per annum to each staff member. The owner has told me that they will need to close the business. I gave that example because I want to show what can go wrong—and, my goodness, it can go wrong at an absolute volume—with regulations that the Government put in place. The business is viable, but does not have the capacity to pay £10,000 in back pay to its staff. It used online tools to get it right, and yet has been left in an untenable situation. That makes it clear that when changes are made to employment practices, the advice for employers must be accurate and easy to understand. This is clearly not currently the case.
With great respect to colleagues on the Government Front Bench, the Bill is a curate’s egg—it is good in part, but not in every part. I welcome some of the measures, such as the end of zero-hours contracts and the enhanced protections, and look forward to seeing the minutiae of the detail.
Gavin Robinson (Belfast East) (DUP)
On Friday, I attended an event hosted by the Northern Ireland Chamber of Commerce and Industry. It offers the Government no ill will and wants to engage positively and pragmatically on the issues, but it is concerned. Does my hon. Friend agree that it would be useful if, instead of continual hubris and politics from one side to the other throughout this debate, there were a willingness on the part of Front-Bench Members to engage thoughtfully with businesses?
Jim Shannon
My right hon. Friend makes exactly the point that I want to make. Through the Bill, the Government are pushing forward legislation that is necessary and welcome, but they need to work better and more closely alongside small businesses and microbusinesses of the kind I worked with many moons ago, whenever I had hair—that is a thing of the past. We cannot expect almost 80% of small businesses to behave as if they have an HR department, a payroll department and a board when most of them are simply retailers as I was, hiring local people and trying to be a good boss in a world with changing obligations.
Support must be central to any change in legislation. Like my right hon. Friend the Member for Belfast East (Gavin Robinson), I ask the Secretary of State to take that point on board. If he is able to do so, I believe we can move forward constructively and help our businesses to maintain their status as employers.
Madam Deputy Speaker (Caroline Nokes)
I call Imogen Walker to make her maiden speech.
Imogen Walker (Hamilton and Clyde Valley) (Lab)
It is an honour to speak for the first time as the MP for Hamilton and Clyde Valley. I am delighted to have the opportunity to declare that I am a proud member of GMB, which does so much for so many.
My constituency has played an important part in the progress of employment rights, for reasons that I will come to shortly, so it is fitting that it is acknowledged here today. First, I pay tribute to Angela Crawley, who represented a large part of the area that I now cover and who has been so helpful in ensuring a handover; she was a dedicated MP and I am grateful to her. I also pay tribute to my hon. Friend the Member for Rutherglen (Michael Shanks), who is always a source of good advice and good humour. His historic win in Rutherglen and Hamilton West was the first sign in Scotland that people were prepared to put their trust in us again. We will remember that.
Hamilton and Clyde Valley is an extraordinary place. The ancient woods of the Clyde Valley are the oldest in Scotland. Entering them is like stepping into another world: you are as likely to meet a rabbit or a red deer as another human. You might see glimpses in the undergrowth of walls, buildings or just piles of stones. It is impossible to say how long they have been there, but they serve as a reminder that so many people have made their lives here before us. Most are long forgotten, but not all. The great Roman general Agrippa is thought to have set up camp just outside Lanark, but he did not stay. Opinions vary on how the Romans were ousted from Scotland: some that believe the Caledonians were just too much for them, while others say that the tribes were nowhere near as bloodthirsty as the midges.
Either way, Lanark is a very welcoming place now. People come from around the world to see New Lanark, Robert Owen’s vision of decent working and living conditions. He believed that people deserve more than just the means to survive, that men and women are equal and that how we treat our children matters. Most importantly, he put his principles into practice. That is what we must do here, because the progress we have made is hard won. It takes courage as well as compassion, and it must never be taken for granted.
In South Lanarkshire alone, nearly 5,500 people are paid at or below the national minimum wage. Many more have working conditions that can and will be improved by this Government. Across Hamilton and Clyde Valley, people need a Government who are back in the service of working people—from Hamilton, the fourth largest town in Scotland and home to 55,000 people, to Larkhall, Lesmahagow, ancient Lanark and our many villages, which all have their own character and close-knit communities. From the deep forests to farms, villages and towns, we truly have everything.
From there to Westminster is quite a journey in so many ways. I will not forget that I made that journey to serve and to protect the things that people care about: their homes, their families and their jobs. I have been given the chance to do that because of the support of so many people, starting with my dearly missed mother Isobel. She would have been so happy to see me here. She, too, believed in the power of education, hard work and opportunity to transform lives. Every evening, the television would go off so we could do our homework in peace. I can tell you from the bottom of my heart, Madam Deputy Speaker, that that was incredibly annoying when I could have been watching “Dallas”, but of course she was right.
On my father Jamieson’s side, generations across South Lanarkshire were shopkeepers and metalworkers, the kind of people who keep our country going and whose lives are changed by the decisions we make here—knocked back if we get it wrong and raised up when we get it right. I am the product of generations who sometimes thrived, often struggled and were ultimately given the opportunity to fulfil their potential through hard-won rights. I want that for everyone: the chance to make a good life for themselves and their loved ones. That is why I am here, and that is what this Government will do.
Graeme Downie (Dunfermline and Dollar) (Lab)
It is a privilege to follow the maiden speech of my hon. Friend the Member for Hamilton and Clyde Valley (Imogen Walker). I visited New Lanark on a school trip when I was younger, as many people in Scotland did, and it was a fantastic portrait of a beautiful part of the country. I pay tribute to other Members who have made a maiden speech today, including my hon. Friend the Member for Airdrie and Shotts (Kenneth Stevenson). I, too, know some of the language to which he was referring.
I draw attention to my declaration of interests, including my proud membership of Unison. I will use my short time to emphasise two elements of the Bill. Not only is it the greatest increase in workers’ rights in a generation, but it will ensure that the UK economy adapts to the changed landscape in which we find ourselves and to the businesses that will contribute to it and make us a success.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
I draw attention to my entry in the Register of Members’ Financial Interests and to my proud membership of Community and Unison. My hon. Friend and I are both proud to represent Fife, but in some areas of Fife as many as one child in four still lives in poverty. Does he agree that by giving over 8,000 more workers more money in their pocket, the Bill will mean that more families have more money to spend and will help to make an important contribution to tackling child poverty in Fife?
Graeme Downie
Absolutely. At the core of the Bill is the need to raise wages for people across Fife, across Scotland and across the UK. That will be a key achievement of this Bill, which has been undertaken by this Labour Government within the 100 days that we promised the electorate.
The change in the landscape has been caused by a rapid advancement of technology in our economy, a shift in working patterns, the evolution of the largest contributors to the economy and welcome changes to the nature of family life, with an increase in shared parenting, as we have heard from so many Members across the Chamber. It is nothing but shameful that the previous Government took no action to adapt to those changes or help them to drive forward our economy. As ever, it has fallen to the Labour party to make the radical changes that we need to see. A look at the Opposition Benches tells us how much the Conservatives care not only about workers’ rights, but about the economy for the future.
I welcome clause 7, which will apply the objective test for an employer to refuse a reasonable request for flexible working. Like hon. Friends who have spoken today, I ran and owned a small business for 10 years. I know the benefits that businesses get from welcoming and embracing flexible working patterns. They assist with staff retention and improve and facilitate communication between employers and employees. They lead to more constructive relationships at work and—as I saw at first hand—to more productive teams and a business that is better for everyone involved. A shift to a clear objective test will further aid the process and will help both businesses and employees.
I also welcome clauses 20 and 21, which will provide additional protection for working parents. Along with my hon. Friend the Member for Makerfield (Josh Simons), I am delighted to support the Dad Shift campaign, which has been campaigning for better statutory paternity leave to help mums, dads, children and our economy. The benefits of modern and flexible paternity leave would help families to raise their children in the way they see fit, so they can still progress their own careers and contribute to the economy and to society. I would like to see more progress on those issues during the passage of the Bill, as hon. Friends have highlighted, but none the less it is an important first step in making sure that new parents have the right protections.
This is a long overdue Bill that would only ever be brought forward by a Labour Government—a Government who understand the changing nature of business, of society and of our workforce and who realise that only by bringing the three together can we push forward and grow our economy together, creating a more prosperous and fairer society across the UK.
Several hon. Members rose—
Madam Deputy Speaker (Caroline Nokes)
Order. I will give an advisory notice: a lot of Members still want to get in, and interventions are cutting into other speakers’ times. The only people who suffer will be you. I am leaving the time limit at three minutes, which could just about get everyone in.
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
Thank you, Madam Deputy Speaker. I will keep an eye on the time.
Like many other hon. Members, I refer the House to my declaration in the Register of Members’ Financial Interests as a proud member of GMB and Unison. We have all just fought a general election; the reality is that general elections can be expensive, so I make no apology for receiving support from the CWU, ASLEF and GMB unions. Without that support, I would not have been re-elected. It is important that we recognise that it is clean money from our hard-working trade union members. We should not be ashamed of that at all.
For many people in my constituency, the nature of the workforce has changed since 2010, yet over the past few years successive Governments have almost rolled back the hard-fought employment rights that we and many trade unions before us have fought for. During the covid pandemic, as I mentioned in an intervention earlier, a number of household-name organisations—multinational business making profits in the multimillions —thought it was okay to fire and rehire their staff. I stood up in this Chamber and raised concerns about constituents who faced the threat of sacking, including many BA workers and many GMB workers who worked for British Gas/Centrica. At a time when we wanted those workers to go out and do their vital jobs, the fact that those jobs could be taken away and they could be re-employed on worse contracts was just wrong.
We should welcome this legislation, which will be a big game-changer for many people across the workforce. In the short time I have, I want to highlight two areas in which we will see a big shift.
Vauxhall and Camberwell Green is home to many young people. TUC stats show that many people in their 30s have been with the employer for less than two years. Young people should be able to go to work, be proud of their work, put their roots down and start a family. Instead, they have insecure work with the threat of dismissal over their head and a lack of security. If young people are planning to start a family or purchase a house, they can be discriminated against by their boss. We want to see rights that will protect the very people we want to contribute to UK plc.
I ask Conservative Members to get with the times and help us to support growth for this country and its workers, including the many workers who are trade union members and who contribute to society. It is about time we supported workers and passed this legislation so that its pro-business and pro-worker measures can support UK plc.
Richard Burgon (Leeds East) (Ind)
I draw Members’ attention to my entry in the Register of Members’ Financial Interests. I have to start with reflections on some of the speeches from Conservative Members, although their Benches are now deserted. Those speeches brought back memories from when I was younger of watching my favourite actor, Rik Mayall, in his role as Alan B’Stard MP. Many Conservative Members seemed to be trying to reprise that role today. It was incredible and left me wondering what planet they are living on. It also took me back to Conservative Members objecting to the last Labour Government introducing the national minimum wage. They said it would have a cataclysmic effect on jobs across the country, when in fact it helped to move people towards getting a decent wage. Conservative Members do not seem to understand that many good employers follow such standards already, and we are enabling those good employers to operate on a level playing field with bad, rogue bosses who seek to undercut good employers left, right and centre.
Before I was first elected back in 2015, I was a trade union lawyer for 10 years, and I saw day in, day out how working people are held back by weak protections and anti-trade union laws. I am really proud to be here today to welcome and vote for this significant step forward in employment rights by a Labour Government. There is so much in the Bill to improve workers’ rights in a range of areas—parental leave, paternity leave, unfair dismissal, statutory sick pay, collective redundancies, tips, the duty to prevent sexual harassment and the requirement for firms of more than 250 employees to make equality plans. The Conservatives think this is bad news for business, for workers and for our country, but that could not be further from the truth.
As this important Bill makes progress, I hope that the Government will find ways to clarify and strengthen a small number of points. Some loopholes on fire and rehire need to be closed, and it would be great if we could further strengthen the rights of union access to workplaces. I would also welcome improvements in a host of other areas. For example, it is 30 years since the Tories took away prison officers’ right to strike, and I would like to see that returned. If people succeed in proving unfair dismissal at an employment tribunal and get a reinstatement order, I would like to see it made much more likely that they will, in fact, be reinstated.
I welcome the Bill, I am proud to vote for it and I think it is shameful that the Tories will vote against it.
Olivia Blake (Sheffield Hallam) (Lab)
I wish to make Members aware that I am a member of the GMB, as many Members on this side of the House seem to be.
It is great to take part in the debate. It is important to recognise the great history of women on these Benches and in our movement, such as Eleanor Marx’s role in setting up the GMB, Barbara Castle’s in passing the Equal Pay Act 1970 and, today, that of our very own Deputy Prime Minister in setting out another game-changing piece of legislation.
I want to focus on gender, because since the introduction of gender pay reporting in 2017, we have made some progress in making people aware of pay disparities in some of our workplaces, but the facts are still stark. The gender pay gap is stubbornly stuck at 14%. That is horrific enough, but in certain sectors, including care, the gap is even higher. Pay inequality compounds over the course of a woman’s life, meaning that she is more likely to live in poverty as a pensioner, and unable to gain opportunities that her male counterparts have had through their lives.
According to the TUC, the pay gap means that, on average, women effectively work for free for nearly two months of the year compared to men. At the current rate of progress, it could take another 20 years to close the gap. That is 20 years too long. While reporting has become an accepted part of employment practice, we must do much more than just raise awareness of the issue. We need concrete action, which is why I am proud that the Bill introduces much-needed regulations to require employees with more than 250 staff to publish a plan to address their gender pay gap. That will ensure that organisations are not only transparent about pay inequalities, but actively work to close them.
Another critical part of the Bill is the provision to support women experiencing menopause. Women between the ages of 45 and 54 make up 11% of our workforce and 23% of all women in the workforce—around 3.5 million women. Despite the growing number of women in the labour market of that age, the challenges they face from the menopause are often overlooked, leading to discriminatory practices and a lack of adequate workplace support. BUPA estimates that nearly 1 million women have been forced out of the labour market by menopausal symptoms. That is simply not good enough, which is why I am proud that the Bill takes steps to address it. Employers will be required to publish how they will better support women going through the menopause.
Sonia Kumar (Dudley) (Lab)
I declare my interests as a member of the GMB, Unison and the Chartered Society of Physiotherapy.
Dudley is home to thousands of small businesses and gig economy workers. Some 89% of those businesses are microbusinesses, and they will be watching closely to see that the Bill strikes the right balance between being pro-business and pro-worker. I believe that it does so. Alongside the “Next Steps to Make Work Pay” policy, the Bill offers a consultation period for businesses and a probation period, allowing them to shape practical and beneficial reforms, giving a voice to businesses and time to adjust, as it will not be rolled out until 2026. I dismiss the claim from Conservative Members that the Bill is rushed, and I hope that the Business Secretary will reaffirm that and reassure Conservative Members that specific guidance and support will be provided to smaller businesses in places such as Dudley so that they can implement the reforms effectively, without excessive costs.
The Bill includes welcome provisions that will strengthen statutory sick pay and provide financial stability for workers. Currently, 10 million people are not able to access basic health support at work, including up to 12,600 people in Dudley. The changes will ensure that no one is forced out of work due to ill health, helping to create workplaces that protect and promote the health of all employees.
For too long, workers have had to wait months for basic protections such as unfair dismissal rights. The Bill will change that by making them day one rights, so that workers are protected from the start of their employment.
Under successive Conservative Governments, access to justice for workers was weakened. Tribunal fees made it harder for workers to hold bad employers to account. Although those fees were eventually scrapped, the damage remains, and the Bill corrects those failures by giving workers the protection that they deserve from day one.
The Bill is also a significant step forward on gender equality. It makes parental leave a right from day one, allowing parents to access leave as soon as they start their job. That is particularly important in Dudley in sectors such as healthcare, education and the beauty industry, and will ensure that being a parent does not undermine a person’s job security.
At university, I was on a zero-hours contract in one of the biggest industries in Dudley. I remember when my colleagues and I would wait for the supervisors to produce a rota, and the uncertainty of not knowing who would be on the shift next. We were not alone; more than 1 million workers in the UK are stuck on these contracts, with more than 80% of them seeking predictable hours. The Bill reflects the values that we stand for of fairness, equality and dignity.
Tom Hayes (Bournemouth East) (Lab)
I proudly refer the House to my entry in the Register of Members’ Financial Interests. Bournemouth is blighted by insecurity, and Britain is paralysed by low pay. As somebody who grew up in very significant financial hardship, caring for two disabled parents, work for me was a route out of poverty. By working on several shop floors in Salford, I was able to earn enough money to go to university. Were it not for that opportunity, I would not be here today. Things were hard then, but they are so much harder today, so I welcome the Bill.
The Bill gives workers in Bournemouth the rights that they need, employers in Bournemouth the security that they need, and our economy in Bournemouth the tools that it needs to grow sustainably. I thank people across Bournemouth East, the constituency that I am so proud to represent, who have shared their thoughts and insights, and met with me about the Bill. I have represented their views and been a voice for their arguments, and I believe that the legislation is stronger as a result.
Across Britain, more than 1 million people on zero-hours contracts will benefit from the new guaranteed-hours policy; 1.5 million parents will benefit from unpaid parental leave as a day one right; and 9 million people who have been with their employer for less than two years will benefit from the new day one unfair dismissal policy. An estimated one in 25 employees did not get any of the paid holiday that they were entitled to last year. The new fair work agency will enforce holiday pay for the first time.
The Bill is a crucial, long-overdue step that directly benefits women at work. It will increase protection from sexual harassment. One in two women have been sexually harassed in the workplace, and four out of five do not report it to their employers. The legislation will empower tribunals to raise compensation in cases of sexual harassment where the employer failed to take reasonable steps to prevent it. An estimated 4,000 pregnant women and mothers returning from maternity leave a year will benefit from new protections. The Bill will also introduce gender pay gap action plans, and strengthen protection for workers through the menopause.
The Labour party made a promise to level the playing field at work by introducing the Bill early in the life of this Government. Promise made, promise kept. I am so proud and excited to be voting for this pro-worker, pro-business, pro-growth, pro-economy measure, and I commend the Deputy Prime Minister for bringing it forward. Bournemouth and Britain have been held back for too long. Together, we take a big step forward, with a measure that has been agreed and negotiated with businesses, trade unions and workers. We are fixing the foundations, and together we are shortening the journey towards the fairer society that so many people elected a Labour Government to bring forward.
Yuan Yang (Earley and Woodley) (Lab)
I draw the House’s attention to my entry in the Register of Members’ Financial Interests, in particular the perhaps interesting fact that, like the majority of journalists at the Financial Times, I am a proud member of the National Union of Journalists. I am able to enjoy that right to membership of a trade union, and the right to assembly and discussion that follows from it, because I am fortunate enough, unlike many of my aunts, cousins and uncles, to be a British citizen living in the UK who enjoys protection of not only my right to vote but my right to collective bargaining and representation in the workplace.
It is fitting that, in this historic debate on this advance in workers’ rights, we in the mother of Parliaments defend not just the right to representation in Parliament through our electoral system, but the right to representation in the workplace through collective bargaining and union access, because strong unions are a workplace form of democracy. I have seen what happens when people are denied that right. I have reported on labour abuses and wildcat strikes—the desperate measures that workers across the international supply chains of Amazon and Apple have gone to when their ability to form a union and advocate for their rights has not been protected by the state. That simply pushes problems underground.
Labour Members know that when workers have issues, there needs to be mediation and they need to be represented properly, through legal means. If that does not happen, it stores up long-term structural challenges for the economy. In the British economy, the wage share of our economic output has fallen since the 1980s. Union representation and density has also fallen throughout that time. It is no coincidence that the two things go together, in the UK and many economies across the OECD. There is a correlation between the strength of unions, and union density, and strong wage growth and worker protections in the workplace.
Beyond the costs to the economy, there are costs to individual households. When I vote for the Bill, I will be thinking of residents and households in my constituency of Earley and Woodley. I will be thinking of the parents I have delivered food parcels to with Woodley Lunch Bunch, who, despite working multiple jobs, are still unable to make ends meet and must resort to using food banks. I will be thinking of the supermarket workers in the Lower Earley Asda, who are—like many of their colleagues across the country—concerned about the threat of fire and rehire.
Above all, I will be thinking of frontline NHS workers in the Royal Berkshire hospital in the centre of Reading, who went to work day after day during the pandemic to clean up after people, suffering the threat of contagion. Many of them—especially those outsourced from private companies—were not afforded statutory sick pay because they were below the lower earnings limit. During the pandemic, the sick pay of many outsourced workers in the NHS was less than a quarter of the national living wage. That is a tragedy. Presenteeism caused by the lack of sick pay costs our economy by reducing productivity and increasing the likelihood of chronic health conditions. I am very proud to support the Bill.
Laurence Turner (Birmingham Northfield) (Lab)
I am glad to draw the House’s attention to my declaration in the Register of Members’ Financial Interests and to my membership of the GMB and Unite trade unions.
The Bill is at the start of its parliamentary stages, but today is also the culmination of years of hard work and consultation. It is important to recognise the accomplishment that the Bill’s introduction represents, and the Ministers, civil servants and special advisers involved deserve great credit. The Bill was born out of the undermining of the dignity and protection of work over many years, which falls heaviest on those in working-class occupations. We all know the effects that 15 years of wage stagnation has brought, the shameful limits that in-work poverty places on the potential of the people we represent, and the unfairness shouldered by those who are trapped on insecure contracts, including in the security and retail sectors in Birmingham Northfield. The Bill will make a real positive difference to their lives.
In the short time available to me I will focus on three measures. First, the 3,000 school support staff and care workers in my constituency are some of the lowest-paid people in public services. They are predominantly women who work under inadequate and outmoded terms and conditions, and their professionalism has gone unrecognised for far too long. I hope that the creation of a school support staff negotiating body and an adult social care negotiating body will have cross-party support.
Secondly, the condition of outsourced workers in public services has also been neglected. They are the invisible workforce who keep our hospitals running and our nation secure. For more than 100 years, under the fair wages resolution and the initial version of the two-tier code, Governments of all colours recognised the principle that outsourced workers should not be placed at detriment. The reinstatement of that principle is of critical importance.
Finally, I welcome the proposed reforms to trade union recognition and access arrangements. When the system has been shown to be open to abuse, it must be changed. In that sense, there is a direct line of continuity between the Grunwick dispute of the ’70s—in which the late Member for Birmingham Erdington, Jack Dromey, played such a prominent role—and the creation of a statutory recognition regime 20 years later. I have heard directly from GMB members about the disgraceful anti-union tactics that they have faced, which were not anticipated when the current law was drafted. They must not wait 20 years for remedy. This Bill is important and necessary, and I am proud to vote for it tonight.
Josh Simons (Makerfield) (Lab)
When Sam Woods, one of my predecessors as the MP for Makerfield, started his working life at just seven years old, he accompanied his father in the pit. By the time he died in 1915, he had become a strong representative for his fellow miners. He played an instrumental part in the formation of the Labour party and championed the legal limit of eight hours for a single mining shift in the Coal Mines Regulation Act 1908. He was, like me—as my entry in the Register of Members’ Financial Interests will attest—a proud trade union member.
Sam Woods’s story is partly about the Labour party’s moral purpose: to improve through Parliament the conditions, security and pay of working people in the United Kingdom. But his story is also about the transformative power of work itself. At its best, work is how we contribute to our family, our community and the trajectory of our nation. Coalmining powered Britain’s industrial revolution, providing industry, warmth and energy. It bound the work of ordinary men and women to the path of our nation. That spirit of production instilled the values of respect and hard work in the communities I represent—values I continue to hold dear. By contrast, the Conservative Benches—sadly, once again so sparsely populated—always sought to resist the change that makes work more secure and better paid. They pit the interests of businesses against workers, of finance against industry, and even sometimes the interests of men against women.
In Sam Woods’s time, Conservative Members said that regulations would bankrupt businesses and even increase unemployment. They said that they would harm communities such as mine. That is why I am particularly pleased the Bill introduces day one protections for pregnant women and rights to paternity leave. The impact assessment clearly anticipates the reforms will have a positive economic impact, which is good for mums, for dads and for growth. I look forward to the upcoming review of shared parental leave, which will cover maternity and paternity leave.
Through work, women organise their power to advocate for equality at work and at home. Through work, we build social bonds, relationships and our sense of purpose. Now, Britain once again has a Government who recognise that work is at the heart of how we participate in, and contribute to, our families, community and country. The industry and ingenuity of working people up and down this country is what makes us who we are. A century ago my predecessor Sam Woods changed the law because he understood that. Now, I am proud that this Government are once again restoring respect and dignity to work, as well as ensuring that all work is secure and well paid. That is why it is an honour to support the Bill tonight.
Darren Paffey (Southampton Itchen) (Lab)
As a proud member of Unison, I am delighted to refer to my entry in the Register of Members’ Financial Interests. It is such a pleasure to be here on the Government Benches and rise to back this pro-growth Bill. I do that proudly on behalf of the people of Southampton Itchen, because I know that it will change my constituents’ lives for the better. It is the largest overhaul of working people’s rights in decades, and it will truly make work pay. That is what this Government are about.
As things stand, unfortunately too many employers put their profits before their staff, and for 14 years the Tory Government were happy to just sit back and do nothing about that. One of my constituents shared with me their experience of having their contract changed to zero hours behind their back, leaving them without shifts and unable to make ends meet. That has to stop. The Bill rebalances that relationship and puts an end to the underhanded moves used by some employers. Instead it gives over 1 million people on zero-hours contracts those guaranteed hours, and provides all workers with the protections they deserve.
We know that a secure job is about more than just a salary; it is about someone having the peace of mind that they can put food on the table for themselves and their family. The Bill enshrines such basic rights in law. With over 16,000 unfair dismissal cases a year brought to tribunals, and over 200 cases every month in the south-east alone, workers are clearly facing unjust treatment. Removing the qualifying period for unfair dismissal will offer people greater security from day one and promote a fairer workplace.
I want my constituents to have better pay, a better life at work and better parental leave. They are already telling me about their optimism for the Bill. It is a Bill that will benefit employers too, by helping to keep people in work, increasing staff retention and reducing recruitment costs for employers. That is happening because this Labour Government are pro-business and pro-worker. By increasing those protections, levelling the playing field and modernising our working practices, today a new dawn is breaking for working people. I am proud that it is a transformational Labour Government bringing forward the crucial Employment Rights Bill within our first 100 days.
Kirith Entwistle (Bolton North East) (Lab)
I declare that I am a proud member of GMB, Community and the Union of Shop, Distributive and Allied Workers. I point Members to my entry in the Register of Members’ Financial Interests, where I declared donations from those unions. I stress that without that money, as a young mum with a small baby, fresh off maternity leave, I would not be standing in this place today. That is a privilege that I believe many Members on the Opposition Benches, which I note are largely empty, take for granted.
I welcome what is the biggest uplift in workers’ rights in a generation, building on the legacy of previous Labour Governments. Bolton North East has over 50% more youth unemployment than the national average. Those workers deserve dignity, stability and to know that their Government are on their side, and for the young people in my constituency, it is about knowing that they have a future. That is why I am incredibly proud to stand in this Chamber today, and I commend the Deputy Prime Minister and my right hon. and hon. Friends on the Front Benches on bringing this legislation before the House.
Improving the lives of working people is one of the things I came to this place to do, as I am sure many of my colleagues did too. With the Government’s “Next Steps” document already published, I sincerely hope Ministers will continue that close collaboration to finalise the practicalities of the Bill with our trade union movement—the fine details that will make all the difference to families in my constituency. Extending workers’ rights and protections is a crucial step towards making work pay, and I look forward to seeing further measures to make work pay, such as extending rights and protections for self-employed people so that all working people can benefit from these widespread changes.
This Bill marks a turning point for working families, not just in Bolton but across the UK. As a member of the Women and Equalities Select Committee, I am particularly pleased that among the Bill’s 30-plus reforms are increased protection from sexual harassment, the introduction of equality action plans, and strengthened rights for pregnant workers. I commend the Deputy Prime Minister and her ministerial team on bringing this Bill before the House, and I look forward to seeing its progression.
Mrs Sarah Russell (Congleton) (Lab)
I refer the House to my entry in the Register of Members’ Financial Interests and my membership of the Employment Lawyers Association, the Industrial Law Society, Unite the Union, Community and the Union of Shop, Distributive and Allied Workers.
The treatment of women in Harvey Weinstein’s companies, UKFast, and plenty of other organisations across the UK is notoriously horrific. A significant number of women work in workplaces that are basically run like medieval fiefdoms. Corporate governance in the UK appears to largely serve to cover up sexual harassment, and to do very little to prevent it.
As someone who has negotiated settlement agreements for a lot of women who have suffered sexual harassment or maternity discrimination, I do not recognise the descriptions of UK employees that I hear from Conservative Members. They appear to regard employees as desperate to bring employment tribunals at any possible opportunity, but my experience of representing women in those situations is that they are desperate to avoid bringing employment tribunal claims. They think that if they talk about what has happened to them, it will cause them significant reputational damage—that they will be blamed for their experiences, and that they will never work again.
As such, they sign settlement agreements meaning that they cannot talk about what has happened to them. They do so knowingly, and often for really quite small sums of money, because they are terrified of the amount it will cost them in legal fees if they try to pursue a claim to tribunal. That is one of the reasons why I am proud to be a member of trade unions and to have given advice to trade union members, because that enables those women to get the support they need to assert their basic workplace rights.
A 2016 TUC report talked about the fact that young women in particular, as well as women on zero-hours contracts, seem to be reporting higher levels of sexual harassment at work than other, older women. In short, those of us who get to a certain age like to hope that things have got better because we stop personally experiencing sexual harassment at work. Unfortunately, the reality is that younger workers, who have less access to advice and support and are more economically vulnerable, continue to receive that harassment year after year. Things are not getting better. Employment rights are fantastic, and it is great that we are improving access to them through this Bill, but when Conservative Members oppose our moves to restrict the use of zero-hours contracts, they do not understand—so far as I can tell—that those contracts, which keep women in precarious employment, are one of the mechanisms by which sexual harassment occurs. As such, I commend the Bill to the House.
Jon Pearce (High Peak) (Lab)
I, too, am a proud member of the GMB. I refer the House to my entry in the Register of Members’ Financial Interests.
This Bill delivers on a key Labour manifesto commitment. It provides a framework for the biggest change in workers’ rights in 50 years. We have heard in this debate that it will ban exploitative zero-hours contracts, abolish the scourge of fire and rehire, and modernise trade union laws. I would like to focus my comments, though, on the vital reforms that this Bill will deliver for young families, and particularly women, in my constituency of High Peak and across the country.
As the Conservative leadership debate is shamefully focusing on whether women should have less maternity pay, and whether a woman can be a mother and a leader, let me tell Opposition Members that they can—and they are, in businesses up and down this country. If the Conservatives joined us from wherever they are—perhaps somewhere in the 1950s—they might understand that far better.
Before I entered this House, I was an employment lawyer advising businesses small, medium and large. One of the occupational hazards was friends and families wanting advice about workplace rights. The most depressing aspect of those chats was that new mums wanted and needed those conversations most. The story was always basically the same: they had just returned to work from maternity leave, and their employer had informed them that they were no longer needed, their job no longer existed, or that they were at risk of redundancy. The joys of that first year to 18 months with a new baby were all but tarnished because of worries about the security of the mother’s job.
An estimated 4,000 pregnant women and mothers returning from maternity leave are dismissed each year. We have to do better if we are to improve productivity and grow our economy. We have to show young families and young mums that they matter, and that their contribution to society and our economy is valued. This Bill will do that. It will create the power to ban the dismissal of women who are pregnant, on maternity leave, or in the six months following their return from maternity leave.
It is depressing that the Opposition wish to portray protecting mums from dismissal as red tape and a burden on businesses, when good businesses know that this is the right thing to do. When I vote for the Bill, I will do it to show every working family in High Peak and in Britain that we are on their side. We are the party that values families.
Douglas McAllister (West Dunbartonshire) (Lab)
Thank you, Madam Speaker, for allowing me the privilege of speaking in this debate on the Government’s historic legislation. This really is the moment that all Labour Members fought so hard for. This is what I promised my community, the people of West Dunbartonshire, that my Labour Government and our Prime Minister would deliver. Some whom I spoke to on the doorstep had given up hope that anyone could change their life for the better. We promised them that we would deliver change—that we would make work pay, and make work fair.
This Bill will bring an end to years of low-paid, insecure employment, which not only failed our people but failed the economy. As a solicitor in private practice, I grew tired and demoralised from regularly having to advise my clients that there was nothing they could do to save their job or improve their working conditions because they had not worked for their employer for two years or more. We will establish day one rights, but please let us also take on board the Law Society’s advice. We must properly resource employment tribunals and fully fund legal aid to allow access to this justice that we seek to introduce.
I received a thank-you card from my constituent Sharon from Clydebank. She said to me:
“I wanted to tell you how the New Deal for Working People will make a difference to me. I am employed in social work. My wages have not increased in line with inflation, meaning a loss of income. I do a difficult, stressful job in public service and all staff are at breaking point. From banning exploitative zero hour contracts to ensuring we have access to workers’ rights from day one—thank you for supporting a New Deal for Working People.”
That is the change we promised.
This Bill signals the largest rights upgrade for workers in my constituency of West Dunbartonshire in a generation by ending exploitative zero-hours contracts and fire and rehire, and by establishing day one rights. Some 7% of the overall workforce in West Dunbartonshire is paid at or below national minimum wage rates. This Labour Government will make work pay for the lowest-paid in West Dunbartonshire, and assist employers in my constituency by helping them to retain their hard-working staff.
In Scotland, we had two bad Governments, and our job in Scotland is only half complete, because it has taken the SNP 15 years just to attach conditions to the Scottish Government’s grants on living wages—
Antonia Bance (Tipton and Wednesbury) (Lab)
As a proud member of Unite and a former TUC staffer, I draw the House’s attention to my entry in the Register of Members’ Financial Interests. In addition, I think ASLEF and the GMB for their kind support of my election campaign.
During the election, I met a young man in Great Bridge in my constituency who was living in a caravan on his parents’ drive, working in a warehouse on a zero-hours contract and not knowing what his pay packet would be from one week to the next. I say to him, to the one in eight black and Asian workers trapped in insecure jobs, and to the 1 million fellow citizens denied the security and the dignity of secure work: “We get it. We know you didn’t choose a zero-hours contract.” Eight in 10 workers on zero-hours contracts want regular hours. We will ban those disgraceful contracts and—listen up, colleagues —we will do so with the support of reputable businesses, such as Julian Richer’s Richer Sounds.
Raising the amount of collective bargaining is indispensable if we want to drive down poverty and inequality, and that is what this Bill will do. This Bill will allow unions to get into more workplaces and tell more workers why they should join a union. No employer needs to fear unions if they are confident that they act fairly towards their workers, and that their sites are safe, so we will legislate to make sure that unions can get into every workplace. After all, do we really think that ambulances would have been at those Sports Direct warehouses 76 times in two years, including for a woman who gave birth in the toilets, if there had been unions checking safety on that site? That is why unions need the right to go into workplaces. As a side note, the rules on access have to be practical, so I gently say to my right hon. Friends that the access agreements as drafted in the Bill give rogue employers just a few too many ways to keep unions out, and I hope we can sort that. This is not just about getting unions into workplaces; it is about getting unions recognised, and having the right to negotiate as equals at the table with the boss on wages, conditions and more. The changes on recognition are fantastic, and are to be celebrated. I hope we can go just a little further and end the three-year lockout, following a failed recognition ballot, that has kept unions out of the workplace, just as GMB workers are kept out of Amazon.
The working class are the backbone of this country. Contrary to what Opposition Front Benchers say, workers are the dog, not the tail. We all deserve security at work and a decent wage. I will be so proud to vote for this Bill—
Steve Yemm (Mansfield) (Lab)
I, too, draw the House’s attention to my entry in the Register of Members’ Financial Interests, and my membership of Unite and the GMB.
I welcome the Bill, and I know that my constituents in Mansfield will, too. There are two key aspects of it that they will be particularly keen to see. First, it offers the right to collective bargaining on pay for those in social care. People in that sector do incredible work, with long shifts and unsociable hours. I am sure that the whole House will join me in thanking the more than 1.5 million people who work in social care across the UK. It is a scandal that, despite the importance of their work, many are paid the minimum wage and struggle to provide for their family. I recall a particularly striking encounter on the doorstep in Mansfield during the recent general election campaign; I spoke to a former adult care worker, who told me that they had become a dog walker because the pay was better. We are a nation of dog lovers, but that is not acceptable to me.
The second aspect relates to sick pay. Millions of workers in the UK are entitled to minimum statutory sick pay only, which stands at £116 a week, and they are not eligible for any sick pay for the first three days of sickness. Opposition Members clearly feel that that is perfectly acceptable, because they took no action on it over the past 14 years, but I wonder how many of them could feed their family and pay their bills on £116 a week. Only recently, almost 300 workers in my constituency have been on strike, including porters, cleaners and cooks employed by Medirest, a private contractor in my local NHS trust in Mansfield. Supported by my union, the GMB, they took a stand, because Medirest company bosses refused to keep their terms and conditions, including on sickness pay, in line with those of colleagues employed directly by the NHS. All those workers wanted was the right to reasonable sick pay. The Bill will help to strengthen statutory sick pay, and for that reason my constituents and I support it, and I commend it to the House.
Nadia Whittome (Nottingham East) (Lab)
I refer Members to my entry in the Register of Members’ Financial Interests. I am a proud GMB member; I am told that there are now more of us here than there are Conservative MPs.
Our economy is fundamentally rigged against millions of workers. How else could we describe an economy where many people’s pay does not cover the essentials, where there are people in work who are reliant on food banks, and where the state has to top up poverty wages through universal credit? Nottingham has some of the lowest average incomes in the country, and my constituents are tired. They are tired of living from pay cheque to pay cheque, tired of being unable to save, and tired of having to choose between going to work sick or falling into debt. People’s mental health is suffering as they work multiple jobs to make ends meet, or worry that they will not be given enough hours to pay the bills. That cannot go on, which is why the Bill is so important.
The Bill is about making work pay and creating a better work-life balance, and a more family-friendly economy. It is about fixing the problems that previous Conservative Governments allowed to fester, or even encouraged. The 1 million people on zero-hours contracts deserve security, and the Bill will give them the option of guaranteed hours. Those who miss work because they are sick deserve to be paid, and the Bill will entitle them to statutory sick pay from day one. Every worker deserves to earn enough to afford the essentials, and the Bill will mean that the cost of living is accounted for when setting the minimum wage, and remove discriminatory age bands.
The Bill is an investment in our future. Making work pay will give people more money to spend in the local economy, and improve people’s health, easing the pressure on public services. We have heard scare stories from Conservative Members before. They told us that the minimum wage would cause an unemployment crisis; it was not true. They want the public to fear trade unions, but trade unionists are not the bogeymen that the Conservative party presents them as. They are our postmen, our child’s teacher, and the nurse who cared for our sick parents. Trade unions are the combined power of millions of ordinary working people. From health and safety improvements to holding bad bosses to account and advancing gender equality, trade unions are a force for good in all our lives. I welcome their strengthening through the Bill, but I would like us to go further and scrap every anti-union law introduced since the Thatcher Government came to power. We must not stop here. The Bill is a vital first step to delivering the new deal for working people and resetting our rigged economy, but it is just that—a first step. We must also close all fire and rehire loopholes, create a single status of worker, and extend collective bargaining.
Andrew Cooper (Mid Cheshire) (Lab)
Like many of us today, I proudly say that I am a member of the GMB and of USDAW. Alas, I cannot declare any donations from either of those organisations, but we do still have a good stock of USDAW carrier bags, which everybody knows are the cornerstone of any Labour campaign centre. I was also recently the director of a mid-sized technology firm. The attitude from those on the shadow Front Bench towards flexible working is frankly out of date and divorced from where the labour market is currently in that sector and many others. Perhaps they might like to reflect on that.
I welcome the Employment Rights Bill and its potential to reshape the landscape of employment in our country to help deliver economic growth and to make work pay. For too long, British workers have endured the burdens of insecure contracts, low pay and inadequate protection in the workplace. That cannot and must not continue, and it is exactly what the Bill will fix. It will enhance the rights and wellbeing of workers and restore dignity, fairness and respect to the workplace, while fostering a robust environment for businesses and contributing to the overall health of the economy. Whether it is ending exploitative zero-hours contracts and fire and rehire practices, establishing day one rights for paternity, parental and bereavement leave for millions of workers, or strengthening statutory sick pay, this Bill is a pivotal step towards achieving fairer and more equitable workplaces.
In the limited time I have, I want to consider the Bill’s provisions on collective bargaining in two sectors. The return of the school support staff negotiating body is an important and welcome first step in improving the pay and conditions of teaching assistants, technicians and others who do vital work keeping our schools running. Their work often requires specialist technical knowledge. They are providing essential support for children with special educational needs, and they are also disproportionately women, and their pay has not kept pace with teachers because of wider pay freezes in local government. I hope that this step will precipitate a broader reassessment of the value of school support staff and ultimately bring about the demise of unfair “term-time only” contracts that see staff lose around £4,000 a year.
The Bill’s provision to establish an adult social care negotiating body is also incredibly welcome, but I urge the Minister to go further and provide a framework to provide for a negotiating body in any sector, with the sectoral specific definitions implemented in secondary legislation. That would the allow the Secretary of State to roll out collective bargaining more quickly and easily to other similar sectors. I urge Ministers to give that consideration, as the Department brings amendments to the Bill in its passage through the House.
Taken as a whole, the measures in this Bill, along with our wider plan to make work pay, promise to create a future where every worker can thrive, businesses can flourish and our economy can prosper. That is why I am proud to support it.
Alex McIntyre (Gloucester) (Lab)
I must declare that I am a proud member of the Community and GMB unions, and—this may be of interest to the Opposition— in my previous role I was an employment lawyer to organisations from FTSE 100 companies to our NHS. The shadow Minister, the hon. Member for Thirsk and Malton (Kevin Hollinrake) might like to reflect on and apologise for his patronising comments to Government Members.
The Bill will provide the most substantial upgrade to workers’ rights in a generation and greatly benefit many in my constituency of Gloucester. Secure, well-paid work for all my constituents is the best way to tackle the legacy of the Tory cost of living crisis. The Bill will take action on zero-hours contracts, which leave workers vulnerable to financial instability and uncertainty. I support the Government in ending that exploitative practice, so that my constituents can benefit from guaranteed hours.
The Bill will strengthen the right to flexible working, which is essential not only for enhancing work-life balance, but for reducing pay gaps in our workplaces. I support measures by the Government to support people in Gloucester to enter back into work in an inclusive and supportive way. The Conservatives doubled the qualifying period for unfair dismissal, leaving 8.5 million workers without protection. The Government will establish an unfair dismissal policy from day one, which will directly support many of my constituents, particularly those on lower incomes.
The Bill will strengthen paternity leave and champion the rights of women in the workplace through enhanced menopause support and protection from sexual harassment. It will improve the pay and conditions of school support staff and social care workers. We all rely on those vital services, and I am pleased to support the Government in valuing the vital work of our social care workers, particularly those in my constituency.
Let us not forget the consequences of Conservative policies, which have led to chaotic industrial relations, leaving many of my constituents worse off amid a cost of living crisis. After 14 years of stagnating wages, millions of lives has been disrupted and our economy has suffered immensely. Industrial action in the NHS alone cost taxpayers £1.7 billion—a staggering sum that could have been invested in the public services that we all rely on. The Conservatives have consistently opposed workers’ rights, but we will always champion them. I have been shocked by the vitriol from the Opposition towards hard-working people getting basic rights like not being sexually harassed at work; they are out of touch.
This Government will deliver a stronger, fairer and brighter future by making work pay, growing the economy, raising living standards and creating opportunities for all. The Bill marks the beginning of a new deal for working people and a brighter future for Gloucester.
Lee Barron (Corby and East Northamptonshire) (Lab)
I declare my proud membership of the Communication Workers Union and that, by virtue of my last name, I am the only legitimate union Barron in this House—I am proud of that fact.
The Bill is a step change and a new deal for working people. It is transformational for so many in my constituency of Corby and East Northants because, for too long, the world of work has not paid. Let’s make no bones about it: this is about growth. We do not believe that the economy can grow based on insecure jobs, zero-hours contracts and bogus self-employment. People need more than that to feed their families. That is why the Bill is so essential. This legislation will give working people a sense of fairness in the world of work, where they can play their part in building our economy and be treated as they should be in our society—with the security, dignity and respect that a job should bring. Our values should not stop at the front door of our workplace; they are an essential part of it.
In this debate, Opposition Members have turned around and said that we are doing this to them: “Businesses don’t want this; no one wants it apart from you lot.” Well, if they had a look at the poll conducted by the Institute for Public Policy Research along with the TUC, they would see that 60% of employers said that employees should have more security at work; 74% believed that strengthening employment rights would improve workforce retention; 73% said that strengthening employment rights would boost productivity; 61% thought that stronger employment rights would have a positive impact on business profitability; and 73% said that they would be prepared to support giving employees protection from unfair dismissal from the first day. This is not being done to anybody. It is being done with them, and we should be proud of that.
Here is my final point: we pay millions to people who look after our money, but we pay peanuts to those who look after our people. That needs to change. That is why I am so pleased to support the improvements to pay and conditions through fair pay agreements, starting in the care sector. They are the ones who need it. We need to deal with the recruitment and retention of the people who look after our loved ones, so that they know from one day to the next who will be coming around and washing their bodies. It needs to be done; it cannot stay as it is. That is why we should support the Bill.
Mr Jonathan Brash (Hartlepool) (Lab)
As many Members have done, I proudly register my membership of the GMB and Unison, and that I am a co-owner of a small business.
One of the consequences of the last 14 years is insecurity in every part of British life. Hartlepool people, who I represent, are insecure in their communities, in their homes and in their jobs. That is why I welcome the Bill, which has security at its heart, banning exploitative zero-hours contracts, ending fire and rehire, and providing day one rights. Listening to Opposition Members—maybe the shadow Minister could reflect on this in his wind-up speech—I would like to know on what day the Conservative party believes it suddenly becomes not okay to unfairly dismiss somebody. What is that time? If it is anything other than day one, then quite frankly they are abandoning the workers of this country.
The Bill does more than give security to workers. It gives people dignity: the dignity to grieve without having to ask permission; the dignity to choose to become a parent without having to worry if it will affect their opportunities in the workplace; the dignity of knowing that they can afford to be ill; and the dignity of knowing that they can turn up to work and be safe. Security and dignity are what British workers, including in Hartlepool, deserve. When people have security and dignity in the workplace, they get opportunity: the opportunity to grow, to develop, to train, to become better at what they do and to become more productive.
In recent days, I have heard people on the right of politics suggest that the Bill is somehow an attack on the “wealth creators” of our country. What nonsense. Let us be absolutely clear: the wealth of this country is created by its workers. Through the dignity, security and opportunity that the Bill provides, we will grow our economy and give respect to every worker in my constituency and beyond.
Kirsteen Sullivan (Bathgate and Linlithgow) (Lab/Co-op)
I draw the attention of the House to my entry in the Register of Members’ Financial Interests.
As a GMB member, it is a great pleasure to speak in this debate. I feel, and my hon. Friends feel, that a substantial uplift to employment rights is long overdue. For far too long, it has been too difficult to get ahead, and too many working people—people who have worked hard—have seen their finances deteriorate, pushing them into hardship. They have done the right thing that society expects of them and they are getting very little in return: they have cut back on the essentials; they have sought extra hours at work; they have had to find second jobs; they have sold furnishings and accessed food pantries just to keep their heads above water—and they find that there is still too much month at the end of their money.
In 2022, the Low Pay Commission estimated that 20% of minimum wage workers and 20% of living wage workers did not receive what they had earnt in wages, sick pay and holiday. The great pay robbery will not be left to continue anymore. That is why it is crucial that the Bill establishes the fair work agency, making sure that everyone is playing by the same rules—and those rules are simple: dignity in work and fair pay. The Bill is long overdue and far too many are missing out on what they are owed.
In the groundbreaking first days of this Labour Government, they mandated that the minimum wage must reflect the cost of living not just this year but every year, matching the earnings of hard-working people to the bills they face for food, energy and transport. Across Scotland, that means a direct pay boost to over 100,000 people, including to over 2,500 people in the West Lothian area and 3,000 people in the Falkirk area. I am proud that this Labour Government are leading business and trade unions to work together to get the economy fired up and to make sure that the people of this country are paid fairly.
The Bill is starting where we left off, with a plan to make work pay, and with fair sick pay, real holiday pay, a clampdown on precarious employment, an end to fire and rehire, and proper hours of work and proper earnings to match. The Bill makes it clear that it is time to go for growth: a stronger, fairer, brighter future for work in the UK.
Brian Leishman (Alloa and Grangemouth) (Lab)
Let me declare first that I am a proud member of both Unite the Union and the Community trade union, and secondly that I am even prouder that the Bill will positively transform thousands of lives across the Clackmannanshire and Falkirk council areas that I serve in this place.
I thank my right hon. Friend the Member for Hayes and Harlington (John McDonnell) and my hon. Friend the Member for Leeds East (Richard Burgon) for their comments about prison officers. Under section 127 of the Criminal Justice and Public Order Act 1994, prison officers were banned from taking industrial action. Correctly, the Scottish Parliament restored the right to strike in 2015, but today prison officers in the rest of the United Kingdom find themselves in a poorer position than their Scottish counterparts, in that they are not allowed to withdraw their labour.
Section 127 has also limited trade unions’ ability to protect prison officers from wage stagnation and attacks on their terms and conditions, which has led to a recruitment and retention crisis and, naturally, to low morale. As in professions such as nursing, the police, the fire brigades and teaching, it is often the camaraderie of colleagues on the shift that keeps things going in a job that provides a vital public service that has been disgracefully underfunded.
The state of our prisons is well documented. Ruthless Conservative austerity has hammered the service. More than a quarter of prison officers have left since 2012. Prison officers were not exempted from the Conservative Government’s raising of the public sector pension age to 68, which, given the physical nature of the day-to-day work, is obviously unfair, unrealistic and, of course, incredibly dangerous. Since that wealth of experience has left, violence directed at both officers and prisoners has escalated.
The prison system is another mess that this Government have inherited and must now sort. Prison officers should have the right to retire at 60 or after 30 years’ service: it is just the right thing to do for employees. No one should feel like a disposable commodity that is there to be exploited and then discarded when every last ounce of work has been wrung out of them. It is also right that prison officers in the rest of the UK achieve parity with Scottish prison officers: they too should have a fundamental right to withdraw their labour.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
Order. There will now be an immediate two-minute speaking limit.
Mary Kelly Foy (City of Durham) (Lab)
I declare my interest as a member of Unison and Unite. In May last year, I condemned the Strikes (Minimum Service Levels) Act 2023 for the consequences that it would have for trade unions. I welcome the fact that this Bill will repeal that Act, and I pay tribute to trade unions and their members for their tireless campaigning. I am keen to hear from the Minister whether the protections for pregnant workers, specifically the right to maternity pay, will be a day one right, and whether there is scope to circumscribe redundancy during pregnancy and maternity leave. If so, will he consider adding those changes to the Bill at a later stage?
There is no doubt that the Bill is hugely positive. However, like my hon. Friend the Member for Alloa and Grangemouth (Brian Leishman), I want to say something about prison officers, who cannot strike because of section 127 of the Criminal Justice and Public Order Act, that Tory-era legislation. There are three prisons in my constituency and I know about the hardships that prison officers face, which are pushing many of them to the brink. I hope that the Minister will be able to meet representatives from the POA and work to repeal section 127 so that its members can have real equality with their fellow trade unionists in other unions.
What we have here is a series of policies that will drastically improve the lives of workers across the country. The Bill is an important first step towards ensuring that all workers can realise their own dignity and worth through their work. The fact that we have it before us today is a testament to the strength of organised labour and the resolve of trade unionists throughout the country.
Zarah Sultana (Coventry South) (Ind)
I am a member of Unite the Union and am the parliamentary chair of the Fire Brigades Union. I refer Members to my entry in the Register of Members’ Financial Interests.
After years of Tory attacks on trade unions and workers’ rights, the Bill will begin to reverse decades of Thatcherite anti-union laws, marking a real shift in the balance of power at work. The repeal of minimum service levels for strikes is a major victory: those laws were tools of class warfare that were designed to break the unions and silence workers. Scrapping them restores the right to strike, a win for every worker.
Equally important is the removal of the undemocratic ballot thresholds imposed by the Tories in 2016. Those barriers undermined collective action. By removing them, we reclaim the power taken from us. Permitting electronic and workplace balloting is another welcome move that will expand democratic participation, but it is not enough. We must go further and repeal every single anti-trade union law since Thatcher.
In its current form, the Bill retains the six-month mandate on strike ballots. Strikes are not battles of a few days or weeks; they are drawn-out struggles for justice and dignity. Workers in Coventry South who are fighting union-busting corporate giants such as Amazon know that these fights can last years. They need mandates that match the reality. We should abolish them entirely and repeal the Trade Union Act 2016 in its entirety, as the Government committed to doing.
Sectoral collective bargaining for social care and support staff is a good start, but all workers across all industries deserve that protection. Voluntary agreements on union access are not enough. Union organisers need guaranteed automatic access. We should also guarantee automatic union recognition when a majority of members join.
Workers have already waited for a decade under Tory rule while their rights have been stripped away, their wages have stagnated and they have been subjected to rogue operators such as P&O. We cannot afford more delays while powerful interests water down reforms. This legislation is a victory for the trade union movement, but the fight is far from over. We need radical change, and that is what I will keep fighting for.
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
I draw hon. Members’ attention to my entry in the Register of Members’ Financial Interests. I am a proud member of the Communication Workers Union and the GMB and am a former official of Unison.
It is a huge source of personal pride to me as a former trade union official that our Government have introduced a Bill that will deliver the greatest uplift in workers’ rights in a generation. While the Conservatives have focused on scaremongering during this debate, it is important to remember the facts. Hard-working people are the trade union movement of this country. No one on the Government Benches will deny our pride in that.
The TUC estimates that 1.1 million employees did not receive any of the holiday pay to which they were entitled last year. This Bill supports those ordinary hard-working people. Last year, 4,000 pregnant women and mothers returning from maternity leave were dismissed. This Bill supports those hard-working people. Some 1.7 million people are out of the labour market because they have to look after their family. This Bill supports those hard-working people. There are 3,800 workers across my constituency of Paisley and Renfrewshire South who earn the minimum wage. This Bill supports those hard-working people. I commend it to the House and am pleased that our Government have strengthened its enforcement measures.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
Order. The Front-Bench speeches will start at 9.40 pm, so the final Back-Bench speaker will be Michael Wheeler.
Michael Wheeler (Worsley and Eccles) (Lab)
I refer the House to my entry in the Register of Members’ Financial Interests, to my membership of USDAW and the GMB and to the fact that I chair USDAW’s parliamentary group.
I spent my career as a trade unionist working to better the lives of people in low-paid and insecure work. They are exactly the sort of people who will benefit from the measures in the Bill, but the Bill goes so much further. I am proud to have stood on an election platform that put improving the conditions of all workers at the heart of the change that was promised. I am even prouder to be stood here today supporting the Government who are delivering that.
I will focus on one element of the Bill: the right to a contract that reflects the hours that someone regularly works. Too many people are contracted for pitifully few hours and are utterly reliant on additional hours that can fluctuate too wildly to provide financial security, with no guarantee that they will not be taken away at the whim of an employer. Measures in the Bill will take steps to rebalance that. If the hours are regularly needed by the employer and worked by the worker, it is only fair that they are guaranteed in the contract.
While hugely welcoming the Bill, I urge the Minister to consider the use of the word “low” in its drafting, as it might unfortunately limit the benefits and lead to unintended consequences. I ask the Minister to work with trade unions, as the organised representatives of workers, to ensure that the maximum number of working people benefit from this new right. I will be proud to vote for this Bill tonight. I commend it to the House.
Gareth Bacon (Orpington) (Con)
We are approaching the end of a long and robust debate, with a total of 71 speeches so far and no fewer than seven maiden speeches. The hon. Member for Hyndburn (Sarah Smith) spoke powerfully and very impressively. The hon. Member for Penistone and Stocksbridge (Dr Tidball) spoke memorably of overcoming considerable adversity and of her considerable achievements, culminating in her arrival in this House. The hon. Member for Blackpool North and Fleetwood (Lorraine Beavers) gave a moving tribute to her late parents. The hon. Member for Dover and Deal (Mike Tapp) laid down an ambitious claim to have the highest number of castles in his constituency and talked of his grandfather serving on flying boats in world war two, which is something that he and I share. The hon. Member for Airdrie and Shotts (Kenneth Stevenson) spoke of his and his family’s great pride in his taking his seat here in Parliament. The hon. Member for Hamilton and Clyde Valley (Imogen Walker) spoke fluently about the history of her constituency, in a deeply impressive speech.
On the Opposition side, my hon. Friend the Member for Leicester East (Shivani Raja) talked about the entrepreneurial spirit of Leicestershire and about her fears that it could be eroded by the Bill. She also, I suspect, achieved a first for Parliament by managing to shoehorn a reference to Showaddywaddy into Hansard. My hon. Friend the Member for Weald of Kent (Katie Lam) spoke movingly of her grandparents’ escape from Nazi Germany and amusingly of the Labour party’s contribution to introducing her parents, ultimately leading to the creation of a future Conservative MP. I commend all hon. Members who made their first mark in this House in a debate on so important a subject. I am sure that they will serve their constituents diligently in the coming years; I wish them all well.
There is much that the Opposition believe is wrong with the Bill, but I have limited time, so I will focus primarily on one element—the role of the trade unions, because their influence runs right through it. If, as expected, the House declines to support the amendment in the name of the shadow Business Secretary, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), and grants the Bill a Second Reading, there will be time to explore the Bill’s many other problems in Committee.
A running theme throughout the debate was hon. Members’ enthusiastic declarations of membership of trade unions, but for some reason they forgot to mention how much they have received in financial donations from them. I remind them and the House that, according to the LabourList website, the Government MPs who have spoken today have accumulated a total of £371,974 in donations from the trade unions. Those donations are no surprise. The public are quickly becoming acclimatised to the idea that this Labour party is in the pocket of the highest bidder, whether that be Taylor Swift, Lord Alli or indeed the trade unions.
I was, however, pleasantly surprised by the number of hon. Members on the Government Benches who have spoken in today’s debate. When I attended the Bill briefing kindly organised by the Under-Secretary of State for Business and Trade, the hon. Member for Ellesmere Port and Bromborough (Justin Madders), just a handful of Labour Members were in attendance, but today they have turned up in great numbers to sing the Bill’s praises. It is to their credit that they are here. Perhaps they have read or watched news of the harm that this Bill will bring and are quietly apprehensive, but have put their heads above the parapet regardless. However, when push comes to shove, they remember that they will be up for re-election in four or five years’ time, and they have to think about their trade union donors.
Very early in this debate, my hon. Friend the Member for Meriden and Solihull East (Saqib Bhatti) said that the Bill is about not growth, but ideology. He is right. This is a trade union charter that will send Britain back to the 1970s. Of course, we know that that is a goal of the Deputy Prime Minister, who has said that she wants to repeal union legislation dating back as far as the 1980s. I appreciate that neither the Secretary of State for Business and Trade nor the Deputy Prime Minister was born until the 1980s, so they will not remember the time when Britain was brought to a grinding halt by the trade unions. The lights were switched off, bodies were left unburied and rubbish piled up all over the place. It is at this point that I remind Members that their constituents will see how they vote today.
I understand that the inboxes of Labour Members are already full, following the freebie scandal, the cash-for-access scandal, the political choice to take away the winter fuel payment and the concerns about tax rises in the Budget. They have my sympathy, but I warn them that their inboxes are about to get even busier. When the junior doctors strike, meaning that their constituents cannot access important medical treatment, they will know that it was facilitated by this legislation. When local councils strike, meaning that their constituents cannot get their bins collected, they will know that it was facilitated by this legislation. When the train drivers strike, meaning that their constituents cannot see their loved ones, they will know that it was facilitated by this legislation. And when small businesses fail because they cannot cope with the massive extra bureaucracy and costs, they will know that it was facilitated by this legislation. As the letters pile high from constituents who are unable to access the services they expect, Labour Members might want to hire more staff, or ask their current staff to work late, but they will be prevented from doing so by the very regulations brought in by this legislation, which they support.
Labour’s misunderstanding of labour relations goes right to the top. When the Secretary of State for Health and Social Care announced that a deal had been reached with the British Medical Association, he said that he was making a real difference. However, we now know that the deal has failed and the BMA is already beginning preparations for further strike action just weeks after accepting the pay deal.
I represent a Greater London constituency and I, of course, remember the Mayor of London’s promise that there would be no Transport for London strikes under his regime, but that is not going very well either. We now learn, thanks to the latest copy of Civil Service World, that there are set to be strikes in the Secretary of State’s own Department. All of that was before this Bill was introduced.
It is clear that, despite being in the pocket of its trade union paymasters, Labour’s approach to industrial relations has failed and will continue to fail. Much of the reason for that future failure will be the rushed job that is this Bill. It has been rushed to the House so quickly that it contains fewer than half of the measures included in the plan to make work pay—a fact recognised by the Government’s “Next Steps to Make Work Pay” document. A vast amount of it will require secondary legislation to take effect.
The Prime Minister has talked incessantly of the Government’s mission to pursue growth, which is an entirely laudable aim, but growth does not just happen. Sometimes, the Government have to do things to facilitate it, and sometimes the Government must not do things that would jeopardise it. The measures in this rushed Bill threaten to destroy any prospect of economic growth.
I am sure the Secretary of State will deny it, but the fact remains that the trade unions will always win out against the Labour party. The unions have donated almost £30 million to the Labour party since 2020. According to LabourList, 16 Cabinet Ministers and more than 200 Labour MPs have received training and donations, averaging £9,500 each. This rushed Bill is the first part of what the trade unions have bought with their money: the chance to massively increase their power base, not just in the public sector but in the private sector, especially in small businesses. This will not lead to growth, unless the Prime Minister is talking about growth in red tape and growth in the trade unions’ ability to choke the economy.
This rushed Bill is not a charter for economic growth; it is a charter for industrial strife, plunging productivity, rising unemployment, inflation and economic ruin. This rushed Bill is not fit for purpose, and the Government should withdraw it and think again.
The Secretary of State for Business and Trade (Jonathan Reynolds)
I thank right hon. and hon. Members across the House for an informed debate on the Employment Rights Bill and the Government’s plan to make work pay. In closing, I declare to the House that I am a proud member of the Unite and USDAW trade unions. Even more proudly, I declare that I come from exactly the kind of working-class family that stands to gain from the measures.
As this is Second Reading, let us remember the history and context leading up to the debate. In recent times, work has changed a great deal. We have seen the impact of technology and the gig economy, and we have had working from home in the pandemic. Many things have changed what work is for many people. That has created a need to consider whether our employment laws are up to date.
Indeed, it was the Conservatives, under Boris Johnson, who first promised an employment Bill in their 2019 manifesto, but they did not deliver. The subsequent Queen’s Speech, after the 2019 election, included an employment Bill, but again the Conservatives did not deliver. In contrast, this Labour Government not only promised an employment Bill; we have delivered one, and in just 100 days. Meanwhile, it appears that some Conservative Members do not even support the existing provision of things like maternity pay, so there have been some differences in opinion between Members on opposite sides of the House today.
It is a proud day for the new Government, but it is a prouder day for Britain’s workers, many of whom can now look forward to a future with far greater security and stability than they have at present. Quite simply, good work and good wages are what this Labour Government were sent to this place to deliver, and that is exactly what this Bill is about.
I take pride in the fact that the new Government have worked closely with all parties in drawing up this legislation, acting pragmatically and listening at all times. The result is a Bill that will make a huge difference to the lives of millions of working people, while being proportionate, fair and reasonable in the asks it makes of business, recognising that the majority of businesses operating in the UK already do so to a higher standard than even this Bill would introduce.
We would not have known that from listening to the depressing speeches made by Conservative Members today. People would not know that Sainsbury’s already pays a living wage; that instead of zero-hours contacts, McDonald’s already offers contracts that provide guaranteed hours; that the Mace Group offers full trade union access to workers on construction sites; that Mars Wrigley offers equal parental leave; and that BT Group already has carer’s leave. Frankly, what we heard from the Conservatives today was binary, outdated and extremely depressing, but I was delighted to hear such significant support for the Bill from the Government Benches, and from all around the House.
Some Members raised specific points. I wish I had time to respond to all of them, but I want to acknowledge the tremendous maiden speeches we heard. The hon. Member for Leicester East (Shivani Raja) gave an incredibly gracious speech about her predecessors, in a very skilful way, which is not easy when she had to defeat several of them to get her place in the House. The hon. Member for Weald of Kent (Katie Lam) told an incredibly powerful family story, woven into a wonderful description of her constituency, and she extolled the romantic benefits of campaigning for the Labour party, which is something we can all get behind.
My hon. Friend the Member for Hyndburn (Sarah Smith) captured the glorious industrial heritage of her area in a way that was extremely relevant to today’s debate. My hon. Friend the Member for Penistone and Stocksbridge (Dr Tidball) gave a speech that testified to the fact that politics can be a force for good, and it was wonderful to hear. My hon. Friend the Member for Blackpool North and Fleetwood (Lorraine Beavers) showed passion and commitment in every word she spoke; I cannot wait to hear more from her. My hon. Friend the Member for Dover and Deal (Mike Tapp) showed his commitment to public service, which has run throughout his entire life; again, it was a wonderful speech to listen to. My hon. Friend the Member for Airdrie and Shotts (Kenneth Stevenson) managed to draw a comparison between his constituency and ancient Rome, which was particularly skilful. His speech was funny, warm, authentic and passionate. Finally, my hon. Friend the Member for Hamilton and Clyde Valley (Imogen Walker), the MP for the area known for Robert Owen, made a wonderful and apt contribution to the debate, with a tribute to hard work and the rewards it can bring—again, it was wonderful to listen to.
Unfortunately, I must give the House some negative advice: to reject the reasoned amendment in the name of the new shadow Secretary of State, the hon. Member for Thirsk and Malton (Kevin Hollinrake). Quite frankly, lads, it is a bit of a mess, isn’t it, as motions go? It claims credit for measures the Conservatives once opposed, such as the minimum wage. It opposes the fair work agency, which they used to support. It claims that there will be more strikes, when they presided over a record number of days lost to strike action, and it shows even less self-awareness when it comes to the burdens on small businesses. Let us not forget who called the referendum on leaving the European Union, with no preparation for either result.
The serious point is this: the Conservative record was one of stagnant wages, low business investment and low productivity. Frankly, it was a record of failure. That is why we must act differently. The shadow Secretary of State claims that the Bill is rushed. Nothing could be further from the truth. The fact that the Bill is ready in 100 days is testament to the brilliance of the civil service and the resilience of the British model of government.
The impact assessment we have published shows that these measures will increase total employment costs by 0.4%, but we know that smaller businesses face proportionately greater up-front costs from regulatory changes. That is why we are working with them closely to make sure that these reforms, and the speed at which they are implemented, work for them. However, I want to be clear that we will not allow for the creation of a two-tier market where someone’s protection as a worker depends on the size of their employer. That would create an uneven playing field and exactly the kind of disincentive to grow that we saw too many of under the last Conservative Government.
The shadow Secretary of State also raised the question of vexatious claims under day one rights. The point he missed was that there are already some day one rights. Protection for whistleblowers is a day one right. Disability discrimination protection is a day one right. If his worry is vexatious claims, those could be brought under the existing system. I thought that was a major weakness in his argument.
We heard speeches paying tribute to what this Bill will do on parental leave. On fire and rehire, I pay tribute to my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald) for his work preparing these measures.
I will also say one more thing on impact assessments to set that 0.4% impact on the UK’s total pay bill in context. Last year, the UK’s total wage costs were £1.3 trillion. To draft a Bill that will have such an impact for so many workers, with a direct benefit transferred to low-paid workers, and to keep it as proportionate as that is, I believe, an achievement.
Finally, on zero-hours contracts, we are not taking away flexibility, but making flexibility two-way. We are ensuring that workers have the right to a contract that reflects the number of hours they regularly work, while allowing them to remain on a zero-hours contract if that is what they want. We are making sure that flexibility works in both directions. There is no reason why that should in any way adversely affect seasonal work compared with what we have at present.
To close, this is a proud day for this Labour Government. This is a change of direction. It is a change to a better and more productive culture of industrial relations in this country. In the case we are making as a new Government, we are not alone. Study after study shows the benefits of investing in the workforce, in better productivity, better resilience and more market dynamism. This Bill makes good on our promise to the British people to change their lives for the better, to deliver an economy that works for them, and to end the poor pay, poor working conditions and poor job security that have held too many people back for too long. For all those reasons, I proudly commend this Bill to the House.
Question put, That the amendment be made.
Business without Debate
Taxi Licensing: Deregulation Act 2015
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Chris Vince (Harlow) (Lab/Co-op)
I give my sincere thanks to the Minister for taking time to engage in this crucial debate. Taxi licensing is not merely a technical matter; it strikes at the heart of issues of fairness and safety, and affects the livelihoods of hard-working taxi drivers in my constituency, in Harlow and surrounding villages such as Lower Nazeing. Although this issue is of nationwide concern, as I hope is evidenced by the many MPs who will speak tonight, I will focus primarily on experiences in Harlow. I am not here to rehash arguments surrounding the Deregulation Act 2015, which was introduced with the best intentions, but we cannot ignore reality and the unintended consequences of that legislation, which have left taxi drivers vulnerable, passengers at risk, and the integrity of local oversight severely compromised.
Shaun Davies (Telford) (Lab)
I congratulate my hon. Friend on the points he is making in his excellent speech. In 2022, the independent inquiry into child sexual exploitation in Telford published its report. It highlighted concern that:
“So far as national policy is concerned…aspects of taxi licensing…undermine rather than promote best practice”
in respect of tackling child sexual exploitation. Does he agree that those concerns should be addressed by the Minister?
Chris Vince
I thank my hon. Friend for that intervention. I am sure that the Minister will address those concerns in his closing remarks.
I have sought this debate to bring attention to the growing dangers fostered under the current system. The 2015 Act has opened a loophole, allowing private hire drivers to license their vehicle in district authorities far from where they operate. In practice, this means that drivers are no longer bound by local standards. Instead, they can shop around for the cheapest licence anywhere in the country, then return to work wherever they choose. Harlow has long had the gold standard for its taxi services—standards that our local drivers proudly meet. Why is that? It is because they know, as I do, that nothing is more important than the safety of their passengers.
Amanda Hack (North West Leicestershire) (Lab)
Taxi licensing enforcement is funded by licence fees. However, with the ongoing race to the bottom for licence issuing standards, local authorities are unable to enforce externally issued licences. Any measure to allow local authorities to enforce would simply stretch enforcement budgets beyond sustainability. Does my hon. Friend agree that the solution has to be guided by the principle that drivers should operate in the areas in which they are licensed?
Madam Deputy Speaker (Judith Cummins)
Order. I remind Members that interventions should be short.
Chris Vince
I absolutely agree with my hon. Friend that the principle should be that drivers should be licensed by the local authority for the area in which they are operating.
Cross-border hiring is undermining high standards, and it strips councils like Harlow of the power to oversee and enforce proper regulations. A driver who loses their licence in one district can simply apply for a licence elsewhere and continue operating with little or no scrutiny. Local authorities lack the enforcement powers to police out-of-town drivers, and that leaves a gaping hole in our public safety framework. How can we claim to protect our constituents, when such fundamental weaknesses exist in our system?
Gill Furniss (Sheffield Brightside and Hillsborough) (Lab)
I thank my hon. Friend for securing this debate. Does my hon. Friend agree that the lack of scrutiny may pose a risk to members of the public, particularly in safeguarding and the safety of vehicles? In Sheffield, where I am from, the licensing team is unable to check the vehicles on the road and whether they are being driven by properly licensed drivers.
Chris Vince
My hon. Friend is right; this is not just a bureaucratic oversight, but a public safety crisis waiting to happen. Vehicles are not being inspected regularly enough and drivers are not being vetted thoroughly enough. Passengers, who trust that any taxi they step into is safe, are the ones left exposed. Taxis often serve the most vulnerable members of our community. Can we truly say that we are doing our duty to protect them under these conditions?
The inconsistency in signage requirements across different districts only deepens the confusion. In Harlow, we enforce clear and visible signage—a rooftop box for taxis and door signs for private hire vehicles. Not every district requires that and, as a result, passengers are left guessing whether the vehicle they are entering is legitimate and safe, and local councils are forced to battle through bureaucratic layers just to verify the safety and legality of those vehicles. That is unacceptable. This deregulation has not just lowered standards but put lives at risk. We cannot wait for an accident or tragedy to spur us into action. We must be proactive, not reactive. We need legislation that reflects the pace of modern life and the demands of today’s safety standards. We cannot fall behind.
Jim Shannon (Strangford) (DUP)
I congratulate the hon. Member on securing this debate. Does he agree that the safety of users and the experience of knowing that an officially licensed taxi driver has been thoroughly vetted is something that many people take for granted, and that urgent changes must take place to ensure that vetting is as stringent as checks for insurance and a clean licence?
Chris Vince
I agree. We are talking about passenger safety. If somehow we could set aside the issue of safety—I believe we cannot—there are other grave consequences of the legislation. It is undermining the livelihood of our taxi drivers. Drivers operating under cross-border licences often lack the local knowledge necessary to provide the level of service that passengers expect.
Several hon. Members rose—
Chris Vince
I will carry on with this bit of my speech.
This situation erodes trust in industry at a time when we should champion local businesses. Instead, we are creating obstacles for them. How can I or anyone in this Chamber look our local taxi drivers in the eye and tell them that we are truly on their side? Right now, I cannot, but by addressing these issues head on, we can change that narrative.
Rachael Maskell (York Central) (Lab/Co-op)
My hon. Friend is making an excellent speech. Does he agree that the Deregulation Act 2015 needs to be repealed? It is deeply damaging in a place like York, where we have a tourism industry, so we need it to be repealed.
Chris Vince
I agree—that is part of what I am talking about. We want to support our local taxi drivers.
Several hon. Members rose—
Chris Vince
I am going to make some progress.
I have heard first-hand accounts from Harlow’s taxi drivers. Will the Minister commit to take action? Will he consider reforming the law to introduce national minimum standards, empower councils to enforce regulations across borders and ensure that private hire journeys either start or finish within the licensed area? These steps are critical not just to restore fairness in the industry but to safeguard the public.
Emily Darlington (Milton Keynes Central) (Lab)
I thank my hon. Friend for securing this debate, which is so important not only for taxi drivers but for safety, particularly for the safety of women and girls at the end of the night, when too often things happen. Does he agree that deregulation has led to a decrease in their safety—especially for councils such as Milton Keynes, a white ribbon city—and that the white ribbon should be part of the taxi licensing regime?
Chris Vince
My hon. Friend is right to say that different authorities have different standards. One issue is not being licensed in the authority where that taxi operates.
Richard Burgon (Leeds East) (Ind)
I thank my hon. Friend for allowing so many interventions and for securing this important debate. Taxi drivers in my constituency and elsewhere in West Yorkshire really suffered during the covid pandemic. Is it not the case that the current regulatory framework for cross-border licensing is enabling some of the bigger operators to rip off hard-working taxi drivers by making sure that they do not get the income that they need and deserve, especially after covid?
Chris Vince
My hon. Friend is right; covid hit tax drivers in my constituency very hard, and we should do what we can to support them. Repealing some of the legislation would help to do that.
I am on my final paragraph, you will be pleased to know, Madam Deputy Speaker. This is not just about needless red tape but—
Chris Vince
No, I am going to finish. This is about essential regulation that protects lives and livelihoods. The hard-working taxi drivers, on whom so many of us depend, deserve a level playing field. Above all, passengers deserve to know that when they step into a taxi, they are safe. I urge the Minister to consider these proposals so that we can create a safer, fairer and more consistent taxi trade for all.
The Parliamentary Under-Secretary of State for Transport (Simon Lightwood)
I do not know about you, Madam Deputy Speaker, but I feel a Westminster Hall debate may be coming soon.
First, I thank my hon. Friend the Member for Harlow (Chris Vince) for securing this debate. The taxi and private hire vehicle—or PHV—sectors provide a vital service to our communities. Whether that is taking elderly people to their hospital appointments or making sure that children get their education, every day our hard-working taxi and PHV drivers show up and deliver an excellent service. The benefits of having a thriving taxi and PHV sector should not be underestimated. These services play a crucial role in our leisure and tourism industries, taking passengers to and from airports and railway stations, and in our night-time economy, making sure that everyone—particularly young women and girls—can get home safely after a night out when other modes of transport might not be available. That is why I am so pleased to see this great industry being debated in the House tonight. I am sure that Members will recognise and applaud the work of our taxi and PHV drivers and operators.
Turning to my hon. Friend’s point about the Deregulation Act 2015, I would like to take this opportunity to share what I have learned about this issue since I became the Minister with responsibility for local transport. The 2015 Act did not enable PHVs to work anywhere; PHVs and taxis have always been able to fulfil bookings anywhere. Evidence submitted to the Transport Committee in 2011 shows that out-of-area working was an issue long before the Act. The Act enabled the subcontracting of bookings to operators licensed by other authorities, as was already allowed under the legislation that applies in London. That was introduced to enable an operator to more easily meet customer requests.
Dr Ahmed
I must declare an interest as the son of a long-standing taxi driver. Does the Minister agree that taxi drivers are, as they proved in covid, key workers and key to our economy, and furthermore, that in recent years their business costs, specifically their insurance costs, have risen to a prohibitively high level? Will he undertake to investigate the root causes of those rising business costs, which are stifling individual taxi drivers from maintaining their businesses?
Simon Lightwood
I thank my hon. Friend for his intervention. I agree that our taxi trade played a vital role during the covid pandemic. I will, of course, take his comments away with me.
Rather than decline or cancel a booking, if an operator did not have a driver and vehicle available, the ability to subcontract to another operator, often within the same company, meant passengers would be better served, as they would not have to find an alternative. The operator could do that for them. Ending the subcontracting of bookings to operators licensed by another authority would not stop out-of-area working. Under the current legislation, it would remain possible for a PHV or a taxi licensed by any licensing authority to carry passengers anywhere. If subcontracting was banned again, and banned in London for the first time, operators would be able to choose to license with a single authority or to have regional hubs and direct all bookings through those.
I turn now to cross-border hiring or out-of-area working, which I believe more accurately reflects the real issue. The difference—I hope we can all accept this —is that people naturally travel across local authority borders, and that some flexibility in the licensing system is beneficial to both passengers and the sector. Out-of-area working is the practice whereby the PHV driver licenses with one authority but intends to work predominantly or exclusively in other areas. PHVs provide a wide range of services, such as home-to-school transport, executive hire and other specialised services. We need to ensure that our regulation of the sector provides the necessary flexibility, while ensuring that local authorities have the tools they need to deliver on their objectives for the industry.
Sir John Hayes (South Holland and The Deepings) (Con)
I am extremely grateful to the Minister for giving way. He will not necessarily be aware—I would not expect him to be, nor the hon. Member for Harlow (Chris Vince), whom I congratulate on securing the debate—that as a Transport Minister, I commissioned a major piece of work on taxi licensing. The report was conducted by Professor Mohammed Abdel-Haq and all its recommendations were accepted by the then Government. They were focused on safety, and the relationship between the protection of passengers and licensing. I invite the Minister to take a look at that report. It is not partisan and I am sure there is much in it that might inform the debate and service some of the requirements that have been so admirably cited by the hon. Member for Harlow.
Simon Lightwood
I thank the right hon. Gentleman for his intervention, and I will certainly take a look at the report.
I understand that there are concerns about authorities’ ability to carry out effective enforcement in their areas, especially against drivers and vehicles that they have not licensed. We are considering numerous options to address that, but I would also urge caution. Certain options could have negative consequences, both for the sector and for passengers. Restricting operations could reduce the availability of services, increasing fares and waiting times for passengers, and bringing more dead miles for drivers. I am sure the last thing any of us would want to do is to drive members of the public into the cars of those who are unlicensed and unvetted, waiting at the roadside or offering rides on social media.
We also need to consider the context within which we are working. In England, there are 263 licensing authorities. A high number of authorities are, in some cases, responsible for licensing a very small number of drivers and vehicles which serve a small area.
Simon Lightwood
I will not give way; I mean to make some progress.
There is a balance to be struck here and the Government are committed to working with all stakeholders to get it right. Most if not all Members will, like me, have more than one licensing authority in their constituency. Our constituents do not live their lives within the boundaries of a local authority area. Their lives will take them across borders frequently. They may live in one area, work in another and socialise in a third, but they might still prefer to use their tried, tested and trusted local operator. It is therefore important for whatever actions the Government take to be examined in detail, so that all the possible benefits and consequences are fully understood.
Our taxi and PHV industry is, on the whole, very well regulated in terms of safety. We are all too aware of failings in the past and their awful consequences for the most vulnerable in society, and that cannot and must not ever happen again. Since those failings were identified, much has changed. Anyone who wishes to become a driver must be considered fit and proper to do so before any licence is granted. I thank my hon. Friend the Member for Telford (Shaun Davies) for his contribution; he has been a passionate and effective campaigner on this issue for many years. I am aware of the report, and I am happy to meet him to discuss it in more detail.
All authorities in England now require drivers to undergo enhanced DBS checks as part of the “fit and proper” assessment. A national database must be used to record all instances in which a driver’s licence is refused, revoked or suspended on safeguarding, road safety or unlawful discrimination grounds. In short, regardless of where in the country a driver is licensed, passengers can feel reassured that that driver has undergone extensive vetting.
Overall, our regulation is increasingly effective, but it is far from perfect, and a conversation still needs to be had about how we can ensure consistent standards for passengers across the country, and how we can put their safety at the heart of the sector. After all, some legislation harks back to the days when a taxi was a horse-drawn carriage. Some solutions may create more problems than they solve, which is why I need Members’ support. I ask them to work with the local authorities in their constituencies to ensure that authorities are using their existing powers appropriately. Safety must always come first, but putting up unnecessary, costly barriers to obtaining a licence, or making those who want to obtain a licence for where they intend to work wait months before they can start to earn a living to support themselves and their families, helps no one.
Overwhelmingly, those in the sector and those who seek to enter it want to do the right thing, and they need to be helped to do just that. We will continue to help authorities to make the best possible use of their existing powers. That must include authorities working together across boundaries in co-authorisation agreements, so that one authority’s enforcement officers can take action against drivers and vehicles licensed by the other authority. They can work with their local police forces in joint enforcement operations, or use the community safety accreditation scheme to equip their enforcement officers with targeted powers—such as the power to pull over taxis and PHVs at the roadside—so that they can do their jobs more effectively.
Out-of-area working is not, should not and need not be the norm, but we need licensing authorities to ask themselves if they are doing what is best for passengers. Just as we are asking local authorities to see what they can do, we are looking at what we can do to help the better regulation of the sector. A range of options is being considered, and I welcome the debate and the ideas of my parliamentary colleagues. I hope that we can work together to find a solution and continue to support a successful taxi and PHV trade, one that is safe, accessible and affordable, and one that continues to serve the wide range of needs of our diverse communities.
Question put and agreed to.
Helme Chase Maternity Unit
Written Statements
Making Work Pay
(2 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Business and Trade (Jonathan Reynolds)
The Government’s plan to make work pay is a core part of our mission to grow the economy, raise living standards across the country and create opportunities for all. It will tackle the low pay, the poor working conditions and the poor job security that have been holding our economy back. The landmark Employment Rights Bill will benefit more than 10 million workers in every corner of the country.
We have committed to working with all stakeholders on how best to put these measures into practice. As trailed in the Government’s “Next Steps to Make Work Pay” document, published on 10 October, the Deputy Prime Minister, the Work and Pensions secretary and I are today launching four six-week consultations. Subject to the outcome of these consultations, we will consider whether there is a need for any Government amendments to the Employment Rights Bill.
Consultation 1: The application of zero-hours contracts measures to agency workers
The Employment Rights Bill includes measures to deliver our commitments to end exploitative zero-hours contracts by introducing:
A right to a contract with guaranteed hours that reflects the number of hours regularly worked, based on a 12-week reference period; and
a right to reasonable notice of shifts, and proportionate payment for short-notice shift cancellations and curtailment.
The Government believe that all workers, including agency workers, should have the right to guaranteed hours that reflect the hours they regularly work. The Government’s intention is that agency workers should also have a right to reasonable notice of shifts and receive payment for shifts that are cancelled or curtailed at short notice. The unique tripartite relationship between agency workers, employment agencies and hirers makes the application of these measures to them particularly complex. The zero-hours contract measures create new responsibilities for employers. For agency workers we need to decide whether these responsibilities sit with the employment agency, the end hirer or both. The first consultation being launched today seeks to understand how these measures can best apply to agency workers.
Consultation 2: Creating a modern framework for industrial relations
The Government are committed to a new partnership approach of co-operation and negotiation that sees employers and trade unions working with Government to tackle the challenges affecting our economy. Workplaces and working practices have changed significantly over the last decade and the trade union legislation that underpins industrial relations is in need of modernisation. Poor industrial relations have held the UK back from reaching its potential. In 2022, 2.5 million working days were lost due to strikes in the UK. In 2023 it was close to 2.7 million—the most in any year since 1989.
We are committed to developing a framework for industrial relations that will stand the test of time. This consultation is taking those first steps forward, to help us build a positive, modern framework for our industrial relations.
The Government are seeking views on a number of changes to modernise and hardwire negotiation, engagement and dispute resolution into industrial relations. The consultation includes proposals on: simplifying the amount of information that unions are required to provide in industrial action notices; strengthening provisions to prevent unfair practices during the trade union recognition process; securing a mandate for negotiation and dispute resolution; requirements on political funds; extending the expiry of the strike mandate; reducing the industrial action notice period; updating the law on repudiation and prior call; and seeking views on the enforcement mechanism for right of access.
Consultation 3: Strengthening remedies against abuse of rules on collective redundancy and fire and rehire
The Employment Rights Bill expands protections for employees in fire and rehire and collective redundancy scenarios. It does this by banning fire and rehire practices other than when the employer genuinely has no alternative and by ensuring that the right to collective consultation is determined by the number of people impacted across the entire business, rather than in one workplace.
The Government are also committed to reforming the law to provide effective remedies against abuse of the rules on fire and rehire and collective redundancy. The third consultation being launched today seeks views on doing that by increasing the maximum period for the protective award for scenarios where employers have not complied with their collective redundancy obligations, and adding interim relief to collective redundancies and unfair dismissals in fire and rehire scenarios.
Consultation 4: Strengthening statutory sick pay
The Employment Rights Bill includes measures to strengthen statutory sick pay for those who need it most, by removing the existing requirements to serve waiting days and extending eligibility to those earning below the lower earnings limit. The Department for Work and Pensions is therefore launching a consultation to support this ambition, and to ensure that the safety net of sick pay is available for those who need it most.
The changes introduced within the Bill will mean that for some lower earners, including those earning below the lower earnings limit, their rate of statutory sick pay will be calculated as a percentage of their earnings instead of the flat weekly rate. This consultation is seeking views on what this percentage should be, to ensure that it provides a fair earnings replacement when these employees need to take time off work. A copy of the relevant equality impact assessment will be deposited in the Library of the House once available.
Next steps for consultation
This package represents the first phase of formal consultations on how best to put our plans into practice.
As is typical with employment legislation, further detail on many of the policies in the Employment Rights Bill will be provided through regulations, and in some cases codes of practice, after Royal Assent. We expect to begin further consultations on these reforms in 2025, seeking significant input from all stakeholders, and anticipate that most reforms will take effect no earlier than 2026.
As outlined in “Next Steps to Make Work Pay”, there are also commitments in the plan to make work pay that we will deliver via existing powers and non-legislative routes, as well as those which will take longer to undertake and implement. We will begin consulting on some of these measures before the end of the year, including launching a call for evidence on tightening the ban on unpaid internships. The Government continue to work closely with stakeholders to ensure that they can plan their contributions to calls for evidence and consultations as they arise.
[HCWS146]
Buy-Now, Pay-Later Products
(2 months ago)
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The Economic Secretary to the Treasury (Tulip Siddiq)
Buy-now, pay-later (BNPL) products have seen increasing use among many UK consumers, helping some to manage unexpected costs. In the six months to January 2023, the Financial Conduct Authority’s (FCA) financial lives survey reported that 14 million consumers used BNPL products.
When provided in a responsible manner, BNPL can provide a useful and affordable source of credit. However, as identified by the 2021 Woolard review, it also has risks. For example, BNPL firms are not required to comply with the provisions of the Consumer Credit Act 1974, and BNPL firms solely offering these types of agreements do not need to adhere to the FCA rules that apply to other consumer credit products. The Government are therefore concerned that consumers using BNPL do not have access to key protections.
On 17 October, the Government published a consultation setting out their plans to fix this by bringing the sector into regulation. The consultation will be open for six weeks until 29 November.
The Government’s approach has been informed by five key principles:
Consumers must have access to simple, clear, understandable and accessible information;
consumers should have protection when things go wrong;
consumers should only be lent to if it is affordable;
regulation should be proportionate so that consumers have continued access and choice; and
regulation must be introduced urgently to ensure consumers are protected and the sector has certainty. Once implemented, the Government’s proposals will deliver on these principles.
Under the proposals, BNPL firms will need to be authorised by the Financial Conduct Authority and will be subject to ongoing supervision. The FCA will be able to set appropriate rules on assessing affordability and creditworthiness, reducing the risk that borrowing is unaffordable. They will also be to set rules on how firms should resolve complaints, including allowing consumers to take complaints to the independent Financial Ombudsman Service.
Consumers will have access to key legal rights, such as section 75, which will make it quicker and easier for consumers to get refunds.
The Government are also proposing to disapply certain information requirements in the Consumer Credit Act 1974 that, if applied to BNPL, could lead to poor consumer outcomes. Instead, the FCA will be able to utilise their powers to apply more appropriate disclosure requirements in its rulebook. This will ensure that consumers can actively engage with the information that firms provide, allowing them to make informed decisions before entering into a BNPL agreement, throughout the duration of the agreement, and especially when they encounter financial difficulty.
Given the need to act urgently—and because HM Treasury has already undertaken previous consultations on this topic—this consultation will be shortened to six weeks. After reviewing feedback, the Government will bring forward legislation as soon as possible. The new regime will come into force 12 months after the legislation is made, once the FCA has finalised its detailed rules. The consultation is available on
https://www.gov.uk/government/consultations/regulation-of-buy-now-pay-later-consultation-on-draft-legislation-october-2024.
[HCWS145]
Ten-year Health Plan
(2 months ago)
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The Secretary of State for Health and Social Care (Wes Streeting)
Our NHS is broken, but not beaten, and we have made it our mission to fix the NHS. But we cannot do it without the help of the people who use it, and so today I am launching Change NHS: A health service fit for the future—a national conversation to develop the 10-year Health Plan. This is the next chapter of the NHS’s story and how we will make it fit for the future.
One of my first acts as Secretary of State was to commission an immediate investigation into the performance of the NHS in England, to start an open and honest conversation about the state of our health service and the reforms needed to ensure its longevity, and that it is fit for the future.
On 12 September, Lord Darzi published his independent review, which revealed the scale of the challenge we face. Our NHS is under rising pressure; we are diagnosing ill health too late and not doing enough to prevent it in the first place. It is too hard for people to get an appointment, hospitals are overcrowded, NHS workers are overstretched and costs are escalating.
I am determined to reverse record levels of public dissatisfaction with the NHS and deliver a health service that is there for everyone who needs it. We have already taken important steps, starting with plans to fix the front door of the NHS by providing funding to support the recruitment of an additional 1,000 GPs by the end of the financial year and settling the pay dispute with resident doctors.
For decades, there has been broad consensus that to overcome the challenges facing the NHS, we must focus on providing more care in the community, so hospitals are able to treat the sickest patients, make better use of technology, and do more to prevent ill health. Despite this consensus, successive Governments have failed to deliver.
We need a different approach to make these crucial shifts and deliver an NHS fit for the future. I want the public and staff to be at the centre of reimagining the NHS, as well as experts from across the health and care landscape. The best ideas are not going to come from above. They have to come from all of us. So, from today, everyone can provide their experience and views at www.change.nhs.uk to help us fix our broken NHS.
[HCWS147]
Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Viscount Colville of Culross) (CB)
My Lords, in the unlikely event that there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Pensions Regulator Defined Benefit Funding Code of Practice 2024
(2 months ago)
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Lord Davies of Brixton
That the Grand Committee takes note of the draft Pensions Regulator’s Defined Benefit Funding Code of Practice 2024, laid before the House on 29 July.
Relevant document: 2nd Report from the Secondary Legislation Scrutiny Committee
Lord Davies of Brixton (Lab)
I always appreciate a challenge, and I was quite interested to note that our Whips have got the idea that this debate will last half an hour, but I will not take up the whole 30 minutes.
First, I have to declare an interest: I am a fellow of the Institute and Faculty of Actuaries, or IFoA as it is now. Many members of the institute provide advice on funding of defined benefit or DB schemes, and they will be significantly affected by the code that is before us. However, I add with some emphasis that I no longer practise as an actuary, hence nothing of what I say must be regarded as constituting actuarial advice. It might sound like actuarial advice, but I assure those here that it is not; noble Lords have to get their own advice rather than take it from me. Nevertheless, I speak from experience as a scheme actuary who has undertaken scheme valuations including, in the past, under the Pensions Regulator or previous iterations.
We are talking about the regulator’s defined benefit code of practice—the code—issued under Part 3 of the Pensions Act 2004. I very much welcome the opportunity to make a few remarks about the code and to ask my noble friend the Minister some questions.
TPR has been producing codes of practice on funding going back to 2006, but it is worth pointing out that it first consulted on this iteration of the funding code more than four years ago, in March 2020, with a second attempt in December 2022. This version was published for consultation in March this year, so its final form comes after years of waiting and four Prime Ministers; the whole Covid epidemic; a significant shift in the financial position of many defined benefit schemes, with increased investment returns in particular; considerable discussion about how these funds should be invested in the light of the Mansion House reforms under the last Government; the pension review under this Government; and, not least, an increased appreciation of the risks to defined benefit schemes from climate change. So much has happened and the code has, in effect, had to hit a moving target. Unfortunately, I would argue that even this version has not really caught up with developments and events.
The new code, together with the Occupational Pension Schemes (Funding and Investment Strategy and Amendment) Regulations 2024, which we discussed in this Room last March and which came into force in April, gives trustees and advisers most of the tools and processes to follow for DB funding valuations with a valuation date on or after 22 September 2024. There has been a bit of time-shifting going on here, but it is not a concern. It is clear that there will be specific areas of the code where further clarification is required, which will be found out only in practice.
I will not repeat everything I said in March, but I want to emphasise my main point. I was talking about the regulations, but it applies to the code as well:
“The regulations are patently too prescriptive. The details that they require are not directed at the objective of protecting members’ benefits but are about establishing a system where box-ticking will take priority over the longer term and broader interests of scheme members”.—[Official Report, 26/3/24; col. GC 165.]
This version may well be better than earlier drafts but, given that the code is already in effect in practice, it should be understood that it is only one stage of the longer-term reassessment that is required, given the continued pace of developments in this sphere. We should not be under the delusion that this constitutes a job done.
There are positives that I want to recognise. The DWP tells us that the draft code has been revised to strike a balance between setting clear funding standards and maintaining flexibility for scheme-specific approaches. The move to a more principle-based rather than prescriptive approach to areas such as the low dependency investment allocation and assessment of the covenant is helpful and gives the trustees some flexibility. Other commentators have welcomed the redefinition of what constitutes significant maturity; clarification of what happens when the valuation is based on notional investment rather than actual investment; greater clarity on how to assess the employer covenant; and—this is particularly important—what applies when there are surplus assets. It is to be welcomed that the final version includes a section for open schemes, collating the guidance that is relevant to them across the code.
Nevertheless, the code remains a work in progress. The IFoA has said:
“The totality of the changes being introduced by the new code remain complex”,
and that there are still a few more steps on the journey to take. It says that it hopes
“the regulator will adopt a pragmatic approach when considering the first valuations under the new regime, due to the short implementation period for the final rules”,
emphasising the point that this is a work in progress.
My major concern remains that here we have 100 pages of detailed instructions and rules, albeit with quite a lot of repetition, not just on how to undertake a valuation under the terms of the legislation for a defined benefit scheme but about how such a fund should operate, particularly in the field of investment. It passed through my mind to go through the document quoting the minutiae that is dealt with—for example, telling us that we have to use a Macaulay duration calculation. I have resisted that temptation—I do not wish to delay people too much—but I have no doubt that the requirements, while well intentioned, are excessive. Although there are references to proportionality, what will happen in practice is that the code will suffer from what is described as procedural drift, where individuals become overreliant on routine processes, potentially leading to reduced understanding of the overall decision: failure to see the wood for the trees.
The underlying belief, as far as I can tell, is that detailed prescriptions and requirements are better than general principles. I do not know what evidence there is for such a belief. Is it true that detailed prescriptions and reporting requirements along the lines set out in the code make it any more likely that members will receive their benefits? I doubt it. As an overriding principle, given the inherent uncertainty about any attempt to forecast the future, there is no reason to believe that making an algorithm more complex improves the outcome.
One problem that concerns me, which I raised in the debate in March, is how the code reacts with Technical Actuarial Standard 300: Pensions. TAS is set by the Financial Reporting Council and lays down how any actuary in the UK should undertake technical actuarial work required by legislation to support decisions on funding, contribution requirements and benefit levels. I have the latest version here; it came into effect in April. The point is that the actuary who undertakes the valuation at the request of the trustees must comply with the professional standard. However, we are in the peculiar position where the code makes no reference to TAS, and TAS refers only by implication to the requirements of the code in an appendix.
It is a matter of concern that the 18 pages of TAS, only four of which refer to scheme funding, make more sense than the 100 pages in the code. What exactly in the code achieves anything that is not already achieved by those four pages in TAS 300? We are told that in its review of TAS 300, the Financial Reporting Council has deferred consideration of the provisions on funding and financing until the new legislation on funding and TPR’s revised code of practice are in place. I am not convinced that this will work. There must be a real question about who is responsible for setting technical standards on funding DB schemes—the Financial Reporting Council or the Pensions Regulator. Judging by the record, my vote goes to the Financial Reporting Council.
Having made that general point, to which I will no doubt return in future, I have three specific questions about how the code will deal with continuing developments in DB pensions. First, there must be a question of whether the code deals with whatever comes out of the first stage of the pensions review. We have been told that the first stage is due to report in the next few months and will consider further measures to support the pensions Bill. It will take account of the need to prioritise gilt market stability, liquidity and diversity. The objective, we are told, is to boost investment, increase saver returns and tackle waste in the pensions system. The problem is that this objective is not reflected adequately in the code. How and when will these issues be reconciled? How will what comes out of the pensions review be reconciled with what has been established in the code?
The second question arises from the improved state of DB funding, which has led to more schemes being run on—continuing rather than moving quickly to buyout. Because schemes will be running on and must, under the code, have the objective of being fully funded, this raises a question: when schemes move into surplus, what rules apply to that surplus? In discussions that people have initiated since we have seen the improvement in scheme funding, it has been suggested that schemes with a material surplus may invest in a greater allocation to growth assets. This aligns with the policies I have just referred to—of both the previous and the new Governments—which emphasise investing for UK growth. That objective is not adequately reflected in the code. In addition to the issue of investing surplus, there are other possible results of improved financial conditions for DB schemes. Not least of them is the possibility of improvements in members’ benefits, either through trustees exercising the discretionary powers that many of them have or through rule changes.
In the same way, some people are talking about the possibility of powers being used to refund sponsoring employers or to use the surplus in the scheme to cover the cost of accruing benefits. Unfortunately, the Pensions Regulator appears to have given insufficient thinking to such developments and to how its powers will be exercised when confronted with such issues. The code does touch on the issue, talking about covenant leakage but in a way that is clearly inadequate when faced with the challenges that will arise from these moves. Will the Government press the Pensions Regulator to give the issues that arise from the potential existence of scheme surplus further thought and more adequate thinking? I have already complained that the code is too complex. I am not suggesting that this should be in the code, which is complex enough, but it is an area to which the Pensions Regulator has to give considerably more thought, so that we know where it is coming from when confronted with these issues.
The third issue, which I will cover swiftly as we will debate it again on Thursday, is the impact of climate change. The code touches briefly on the issue, in paragraph 23 of the application module, but it is an issue on which the Pensions Regulator has to take much more of a lead. Will the Government encourage the regulator to pursue what needs to be done to enable schemes to confront the challenge of the greater risks that face the financial system, including defined benefits schemes, as a result of global warming?
Baroness Drake (Lab)
My Lords, I declare my interest as a DB pension scheme trustee as recorded in the register. I thank my noble friend Lord Davies for securing this debate. This is an important code, and it should not pass without comment.
As the Explanatory Memorandum and my noble friend observe, while aggregate DB funding levels have improved in recent years, financial markets and economic conditions are changeable and funding positions can quickly deteriorate. There is a dynamic in the pensions world related to economic circumstances, whether fiscal policies, investment returns, gilt yields or the impact of technologies on markets, to name but a few.
An intended purpose of the code is to allow TPR to be more proactive in identifying and mitigating emerging risks in a targeted way. There have been significant instances over the past 30 years of regulatory failure to identify or respond quickly to emerging risks in DB pension provision, some with dreadful consequences. What do the Government believe are the most compelling levers in this code that will materially improve mitigating such emerging risks?
The new code sets two key requirements: planning for the length of the scheme’s journey plan to get to full funding at an appropriate pace of de-risking and assessing current funding positions when carrying out valuations. As part of that planning, the code trustees must set a funding and investment strategy—that is, the journey to getting to the planned endgame for the scheme. The strategy must set out how the trustees will transition from the scheme’s current funding position to low employer dependency funding when the scheme is mature. In making that transition, how risk can be supported by the employer and the strength of the scheme has to be made clear.
During the consultation a lot of concern was expressed that the new code could weaken an important fiduciary power of trustees to make the investment allocation decisions by requiring trustees to invest in line with the investments set out in the funding and investment strategy that must be agreed with the sponsoring employers. In response to those concerns, although changes have been made to the code to clarify that decisions in relation to the scheme’s investment allocation are not constrained by the notional investment allocations in the funding and investment strategy, an inference remains that, in most instances, TPR expects trustees to align their investment strategy with the funding and investment strategy. Will the Minister confirm unequivocally that the code will not remove the power of existing trustees to decide on the scheme’s investment allocation? It is an important power in addressing moral hazard.
The code places a welcome greater emphasis on the strength of the sponsoring employer covenant, which is of fundamental importance but is often lost in debate, when considering funding and investment risk. The level of cash generated by a sponsoring employer and its future prospects will be key determinants of how much investment risk a scheme should take. The strength of an employer covenant can change very quickly following mergers, acquisitions, restructurings et cetera. Such changes may result in changes to the level of debt in a company, dividend policy, free cash flow, covenant and longevity. The code requires any funding deficits to be repaid as quickly as the sponsor can reasonably afford, but trustees will have to consider the impact on the employer’s sustainable growth. Trustees will need to assess such affordability annually; they will also have to provide evidence for their view of what is reasonably affordable and their opinion on the maximum supportable risk that a sponsor employer can bear.
These are potentially significant areas for disagreement between sponsoring employers and trustees, with one seeking to discharge a fiduciary duty to protect its members and another wanting maximum freedom from the liability of funding a pension scheme, but TPR has still to provide its covenant guidance on the main areas that trustees must consider when assessing the employer covenant. In that sense, there is a significant area of this code where an important point of detail is missing. Can the Minister advise when such covenant guidance will be issued?
The code emphasises a flexible and scheme-specific approach to regulation, taking into account the variety of DB schemes. It contains provisions for schemes that remain open to new members and may not be maturing, such as schemes that are now closed. Again, that is quite a controversial issue in the initial iteration and consultation on the development of this code. The considerations around investment strategy and the ability of trustees to choose how to invest now recognise the different characteristics of open schemes compared to closed schemes; the importance to open schemes of long-term planning; and a more flexible approach to assessing investment risk, which is supportable by the covenant and the scheme.
Finally, the Explanatory Memorandum—I shall pick up with brevity a point that my noble friend elaborated on in more detail—states:
“The approach to monitoring this legislation is that there is no requirement to carry out a statutory review of the draft Code”.
However, as we all know, the previous Government were—and, more so, the current Government are—focused on the issue of wider funded pension scheme consolidation and scheme investment strategies. Although I recognise that the Minister cannot comment on the outcome of such considerations or what may flow from the first pension review, if those outcomes had an impact on the provisions of the DB code, what would be the mechanism and consultation for revising the code as a consequence?
Baroness Altmann (Non-Afl)
My Lords, I congratulate the noble Lord, Lord Davies, on securing this important debate. I agree with the noble Baroness, Lady Drake: the code is an important document that certainly deserves the attention of this Committee. I apologise to the Minister because this debate may well end up lasting more than the half an hour that was apparently expected; I will try to be as succinct as I can.
The overall aim of the defined benefit code is to protect member benefits. The whole point of the code was that, in the past, there had been a kind of free-for-all where employers and trustees could invest and take as much investment risk as they wished. Given other circumstances in the market, hundreds of thousands of members either lost their benefits or were at significant risk of doing so. I welcome the fact that there is now a stronger regulator, the Pension Protection Fund and this kind of code, which is constantly being revised and updated.
However, I stress that I agree wholeheartedly with the comments of the noble Lord, Lord Davies, that this particular document, like previous documents, is rather too prescriptive, with excessive requirements placed on trustees, who may or may not need them. It seems to attribute spurious accuracy to an inherently uncertain outcome of events. The kind of box-ticking and groupthink approach that needs to be revised within 15 months of each new valuation will be costly to the schemes, and it is not clear what value will be added if the long-term strategy is unchanged or not likely to change.
Some of the issues we are grappling with, in this code and in the defined benefit universe as a whole, are dependent on and the result of the exceptional period of quantitative easing introduced in 2009. It was deliberately designed to drive down government bond yields and, concomitantly, to clearly put a much greater inflation risk on liabilities. That is indeed what happened. Initially, assets did not keep up with liabilities, but the fears of ongoing falls in gilt yields over that subsequent period, as quantitative easing, gilt printing and the driving down of long-term bond yields continued, have made anyone involved in the defined benefit space rather nervous of what are called “non-matching assets”.
We had a reversal of conventional thinking about defined benefit pension schemes. They were supposed to invest to take risk and welcome risk placed judiciously. This thinking became: do not take risk or try to beat the gilt market, because the gilt market may beat you and increase your deficit. So a whole groupthink built up around the idea that defined benefit pension schemes should have as much as possible in so-called matching assets, because you want to match your liabilities. The fact is that, if you want good funding, you need to outperform your liabilities—just matching them is not sufficient—but I am not sure that that is reflected very much in the code for schemes that are not in healthy surplus.
I welcome the Minister’s comments on the fact that we are talking about estimated liabilities based on expected future values, relative to current mark-to-market actual values for the assets, and on whether the risks of attributing that spurious accuracy to the long-term liabilities have been sufficiently considered. In this regard I declare my interests: I work with some defined benefit pension schemes, and have done so in the past, to advise on investment strategy.
It seems to me that part of the thinking going through this defined benefit code is that it is better for all schemes to fail conventionally than for too many schemes to try to do unconventional things that might succeed but incur greater risk. I feel we need more scheme-specific flexibility there, and we need to consider the impact of quantitative tightening and how that will be different for the pension liabilities associated with these schemes.
I welcome the differentiation mentioned by the noble Baroness, Lady Drake, and the noble Lord, Lord Davies, between open and closed schemes. I urge the Government to consider going further in allowing and enabling open schemes to take advantage of investment opportunities from a diversified array of risk assets, even in circumstances where there is, perhaps, some nervousness about the sustainability of the employer.
There is concern about the stability of the gilt market, but there is also an inherent conflict between that desire for stability and the need for outperformance of liabilities that these schemes could be delivering. If capitalism is not at an end—one might argue that it is—then investing in assets of higher risk than government bonds or the supposedly safer assets should, on aggregate and in the long run, deliver better returns. On top of that, we have a Government who rightly want to use more pension assets to boost the economy. There are assets such as infrastructure, small growth companies and equities as a whole, both domestically and internationally, that could deliver that objective, but they entail risk. That is where I hope the funding code may be further refined.
Baroness McIntosh of Pickering (Con)
My Lords, I was not intending to speak because this is way out of my comfort zone, but I congratulate the noble Lord, Lord Davies of Brixton, on securing this debate. I spent a year in opposition as a shadow Minister trying to encourage women in particular to enter into a pension scheme. This is a classic example of how fiendishly complicated UK pensions are.
I have a number of questions for the Minister, who is quite an expert in this field having shadowed it for a number of years. I welcome her to her place in this Administration. The Secondary Legislation Scrutiny Committee says in its second report that it remains concerned about the cumulative burden of so much regulation on the schemes. While the Explanatory Memorandum states that there were two waves of consultation, it is still not entirely clear how much support for and understanding of the scheme there is.
However, my main concerns relate to paragraphs 9.3 and 9.4 of the Explanatory Memorandum, which cover the impact assessment and the schemes’ mind-boggling costs. Paragraph 9.3 states:
“Initial implementation costs, including familiarisation, could total around £36.8 million in the first year”
alone; I am not surprised, given how complicated it is. It goes on to say:
“Schemes may then face ongoing administration costs of £5.4 million per annum”.
However, paragraph 9.4 states that there will be
“an estimated increase of around £7.1 billion to around 1200 schemes over the 10-year period”.
Will there be any sort of watch to see whether those figures are final—or, indeed, whether there may be some liquidity in them? They might not represent the final cost going forward but they are eye-watering. It is right to update the code but, in view of the figures, have the Government reached a verdict on what the cumulative burden on the schemes will actually be?
Lord Palmer of Childs Hill (LD)
My Lords, I thank the noble Lord, Lord Davies. Indeed, I thank all the speakers for the expertise gathered in this Room on what is an unlikely subject for many people.
On the DB funding code, first, with all the expertise that has been expressed—and for those reading Hansard who have no expertise—perhaps I ought to say something basic. For the record, what is a defined benefit pension? It is a type of workplace pension that guarantees you a specific income for life throughout retirement. The amount that it pays out depends on things such as your final salary, your average salary and how long you have been a member of your employer’s scheme. I know that everyone in the Room knows that, but people outside it may not.
The DB code has been many years in the making, as the noble Lord, Lord Davies, said. It sets out in detail how defined benefit pension schemes will have to approach funding in future, including things such as how quickly they must deal with any deficit that may arise. The code was arguably written in an era of deficits, whereas the majority of DB schemes are now in surplus, but I agree that you still need a set of rules for those schemes that are short of funds.
Despite all the worthy speeches, most of the code is uncontroversial, in my view, and has my general support. The response from the industry has been broadly positive; it appears to give trustees and scheme sponsors flexibility while ensuring that they carry out proper risk management as it relates to their pension products. Numerous articles have been written on it; given the length of this debate, I will not go into them in any great detail, but I highlight an article entitled “PwC Comments on The Pensions Regulator’s New Defined Benefit Funding Code of Practice” and an article in Pensions Age Magazine headed “Industry expresses ‘relief’ as TPR confirms final DB Funding Code”. So the industry and commentators have been complimentary in general terms.
However, I wish to raise some issues on which I would appreciate the Minister’s views. First, how far does the code truly accommodate the needs of remaining open DB schemes? This was a big topic of debate in the Lords during the passage of the Pension Schemes Act 2021. Does it allow them to take an appropriate level of investment risk for the long term, rather than having to go for lower-risk assets prematurely? This simply means that they cost more to run, as the noble Baroness, Lady Altmann, said in another way.
Secondly, how far does the code recognise the particular position of charities and other not-for-profit sponsors of pension schemes? Is there a risk of charities being forced to close deficits too quickly and, therefore, having to divert a loss of revenue income into the pension scheme? There would then be a risk of it appearing to donors to those charities that their money is not being used for front-line charitable purposes, thereby weakening the charities’ futures. I would appreciate the Minister’s comments on that.
Finally, I am sure the Minister has read the blog by David Fairs, who worked at the Pensions Regulator. It was headed: “At long last, new regulations fire the starting gun for the new funding regime”. He stresses the challenges and opportunities missed. He queries—and he is an expert—whether the new funding code will make a significant difference. I ask the Minister the same question.
Viscount Younger of Leckie (Con)
My Lords, I thank the noble Lord, Lord Davies, for giving us the opportunity to have the first pensions debate in this House since the general election. This Committee is my first experience of swapping sides with the Minister, and it gives me the opportunity to wish her well in her role with all its responsibilities, with which I am all too familiar.
This debate on the defined benefit code of practice is interesting in that, as has been said, it is not an SI but arises out of one in the form of delegated powers from the Occupational Pension Schemes (Funding and Investment Strategy and Amendment) Regulations 2024. It seems that every decade or so there is a requirement for a code update: there was one in 2006, leading to the current version in 2014, and now in 2024 we are debating another code of practice—number four, I believe. Updates are based on the premise that the pensions landscape changes, and of course it does, as now with the need for scrutiny of liabilities in DB schemes, the plethora of closed and maturing schemes and the need to ensure risk management, greater robustness over the longer term and optimum management of open schemes, which have been alluded to in this debate.
Ensuring that pension schemes are well managed is essential in safeguarding the incomes and welfare of pensioners. This is especially important at a time when the cost of living is high and the Government are restricting the financial support available to pensioners—more of which later. I welcome the publication of this code and its stated aim of helping trustees comply with their responsibilities under the defined benefit pension funding requirements. The focus is necessarily on supportable risk and ensuring that trustees and sponsoring employers are not caught unawares and plan well ahead, in particular where schemes are nearing maturity.
The work on the code was undertaken by the regulator under the previous Government, and I am pleased that the consultation on the code—there have actually been several, as the noble Lord, Lord Davies, and others alluded to—has been widely accepted by a broad range of stakeholders. I note that where there were concerns, such as on the need for flexible risk-taking at low dependency and not a one-size-catch-all approach, they were largely addressed and accepted in discussions with the industry.
I have listened with interest to the technical points raised by a number of noble Lords, in particular the noble Lord, Lord Davies, and I know that these points will be addressed—I say this with some relief—by the Minister. By his own admission, the noble Lord, Lord Davies, repeated some of the points made in the debate in March, such as about so-called box-ticking and the code being too prescriptive. In March he also mentioned his concern about the regulator misunderstanding its role, although I am not sure he alluded to that today.
My first question to the Minister leads on from this. It is simply: is the job done? Is the code an iterative process because we do not want another 10-year wait, or do we just accept that this is bringing it up to date and that, in effect, we wait for eight or 10 years? It does not particularly matter, I suppose.
I have some questions of my own on the code. The best-practice management of pension schemes is dependent on the effectiveness of trustees. How does the Minister regard the current landscape for recruiting trustees? There is a danger that too much guidance and steer towards adherence to codes, with the greater responsibilities attached, could act as a chilling factor.
What is her assessment about the training of trustees? This question plays into other questions, not least those of the noble Lord, Lord Davies, and the noble Baroness, Lady Drake, who quite rightly alluded to the important relationship between employers and their covenants, as well as the trustees. Who undertakes this training? This is important in assisting the chairs of trustees and, of course, the supporting employers.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Sherlock) (Lab)
My Lords, I thank my noble friend Lord Davies for securing and opening this debate and all noble Lords for their thoughtful and constructive contributions. I say to my opposite number, the noble Viscount, that it is easier asking questions than answering them in this space, so I hope that noble Lords will bear with me. More questions were asked today than I can conceivably answer in the time I have, but I will do my best to get through them. I assure noble Lords that we will carefully scrutinise Hansard and write to them with the answers to any questions that I cannot pick up.
First, by way of background, as my noble friend noted, earlier this year the House approved the Occupational Pension Schemes (Funding and Investment Strategy and Amendment) Regulations 2024. It is worth remembering that, alongside those regulations, the code of practice we are discussing is a key component of the new arrangements for the funding of DB occupational pension schemes. I am grateful to the noble Lord, Lord Palmer, for explaining what a DB scheme is to those watching at home. I hope that those watching at home who have never heard of a DB pension scheme are enjoying themselves, and I encourage them to read Hansard afterwards.
The code is designed to provide practical guidance for trustees and employers to meet their legal obligations, and it includes key metrics needed to implement the requirements. We moved very quickly to lay the code in the new Parliament to give schemes and industry the certainty they have been calling for. It may not be noticed from reading the debate that in fact the code has been well received. A lot of consultation has gone on.
The new scheme is designed to ensure the security and sustainability of DB pensions. Let us not forget the reason we needed to act at all: the damage done by schemes that were not appropriately run and the ensuing loss of benefits to members. Not taking action was not an option. These reforms strengthen the funding regime by providing clearer, more enforceable funding standards with a greater focus on long-term planning.
My noble friend Lord Davies noted that we have published two consultations on the code. The first, in 2020, considered the key principles to underpin the new regime and the proposed regulatory approach. The second was a consultation on the first draft of the code that we are debating today. DWP and the regulator worked collaboratively with and listened to a wide range of stakeholders. As a result, changes have been made to the code to provide more flexibility. For example, the regulator developed a chapter specifically for open schemes. When the code was published in July, it was welcomed for providing clarity and achieving a flexible approach. There is broad consensus that the code strikes the right balance between member security and employer affordability. Crucially, it provides sufficient scheme-specific flexibility to take account of the very wide range of scheme circumstances. I thank the noble Lord, Lord Palmer, for his support and the noble Viscount, Lord Younger, for the acknowledgment. Broadly speaking, we are looking at detail, but we think we are doing the right thing in the right way.
The new framework, including the code, has been revised following extensive engagement with industry to ensure that it provides flexibility for schemes to invest in a wide range of asset classes, including growth assets, both before and after significant maturity. Open schemes, like others, will have significant flexibility to invest in riskier investments with potentially higher returns, if the risk can be supported, so member benefits are protected. It also makes clear that the open schemes will not be made to derisk as long as they remain open to new members, are not maturing and the risk they are taking is supported by the employer covenant.
I will try to go through as many of noble Lords’ questions as I can. First, the phrase box-ticking has been used once or twice. I reassure noble Lords that this regime is absolutely not a box-ticking exercise. The regulator is taking the opportunity provided by the introduction of the new regime to evolve the way it regulates DB funding. This includes proportionate measures with flexibility for different schemes. The regime will be based on clear metrics designed to protect members’ benefits as well as to take account of employer affordability.
The Pensions Regulator operates on a risk-based and outcome-focused approach. We think that that proportionality is in the right space. The regulator is introducing a twin-track approach: fast-track and bespoke. This aims to help target its engagements with the sector effectively. Where a scheme meets a series of fast-track parameters, the regulator will ask for less information and is less likely to engage with trustees. On the other hand, the bespoke route allows schemes to take a different approach and to provide evidence of why this is appropriate. Many of them are unlikely to require further engagement between the regulator and trustees.
My noble friend Lord Davies asked about the use of scheme surplus. I remind the Committee that, in February, the options for defined benefit schemes consultation sought views on the potential benefits of introducing additional flexibilities for the use of surplus funding on DB pensions schemes. The Government will continue to consider the potential of such flexibilities to benefit scheme members and sponsoring employers while supporting economic growth.
The noble Viscount, Lord Younger, asked about low dependency investment allocation. The flexibility of the UK’s funding regime is one of its greatest assets and one that we have been careful not to undermine in the new arrangements. Pension schemes are many and varied and each has its own circumstances, so they are best managed through scheme-specific arrangements. That is why we try to balance clear metrics on how liabilities have to be calculated with scheme-specific flexibilities that allow trustees the discretion to react to changing circumstances and act in the best interests of their members while strengthening the ability of the regulator to intervene and act if things go wrong. Noble Lords may have other views. We believe that this balance is right and in the interests of members of schemes.
There was a question about whether trustees have the flexibility to take decisions in the light of the circumstances of their individual schemes. Flexibility is a key strength of the regime, but it is balanced with those funding standards and the key metrics of the new arrangements. The bottom line is that it is fine to take supportable risk. Taking investment risk to benefit from potentially higher returns is fine if there is enough time for asset values to recover or a sponsor with enough resources to pay more in the future. That is why the new regime focuses on the key metrics of maturity and covenant strength.
The noble Baronesses, Lady McIntosh and Lady Altmann, raised costs to scheme members. It is worth putting those absolute costs in the context of the scale of our pensions world. The impact assessment for the code indicates that costs will amount to around £7,000 per scheme on average, with ongoing administrative costs of approximately £1,100 on average per scheme. That excludes costs associated with changes in deficit repair contribution payments, of course. Those are small costs compared to the overall liabilities of a scheme. They are unlikely to have a significant impact, and certainly not on members. Most schemes are closed, and members of those schemes will not be paying contributions. Modestly increased costs are unlikely to have any impact on the probability of members’ benefits being paid in full. There are some members in schemes which share costs and are still open for accrual, but they are the minority. Only 4% of schemes are fully open; 20% are closed to new members. As the costs per scheme are estimated to be low, we do not anticipate any significant material impact on members overall. This must be seen in the context of the impact of clearer funding arrangements with more emphasis on long-term planning, which should make members more confident that their benefits will be paid in full.
We were asked what will be done to monitor the costs. We will continue to monitor the costs. Although there is some uncertainty about trustee behaviour and response, as we cannot know that, the impact assessment used data from March 2022 and modelled, on average, an overall net saving of around £20 million per year. I can write with more detail if Members would like that.
It is worth understanding that the regulations and code are principle-based. The code is practical guidance for implementing the regulations.
The noble Lord, Lord Davies, asked about different valuation methods. I will not get into TAS but will write to him on how TAS interacts. However, I have a word for the broader audience watching from home about the different valuation methods. There are two main ones. The technical provisions are, rightly, used to assess contributions and deficit recovery contributions because they are calibrated to balance member security with employer affordability. On the other hand, the solvency measure is much more generic and less scheme-specific. It is used to assess funding against the cost of insurance buyout. That is a much stronger measure. Schemes are not required to be funded to that level because that would make DB much more expensive, if not unsustainable. The use of these technical measures does not push schemes into inappropriate de-risking or into a risk-adverse approach. Schemes can choose a variety of approaches to setting their liabilities, including by reference to the investments that they intend to hold. They will be affected by a whole range of considerations, not least the route to compliance with TPR that they choose to use.
The new regime is extremely scheme-specific and flexible. Even at significant maturity, schemes can invest in a proportion of return-seeking assets provided that the risk can be supported. Most schemes are currently investing more prudently than the new regime requires. Indeed, the regime suggests that there is headroom for some schemes to take more investment risk than they are taking currently, of which I am sure the noble Baroness, Lady Altmann, will be very conscious. The requirement in this to derisk will, as intended, mostly impact outliers which have been pushing the scheme-specific flexibilities further than they were ever expected to stretch and, in doing so, putting members’ benefits at risk. It is right that those outliers should be required to derisk to protect members’ benefits through the clearer and more enforceable metrics of the revised regime.
Lord Davies of Brixton (Lab)
I thank the Minister for her long and detailed response. I think I need to use the formula used by Ministers: “I will read the entry in Hansard”. There was so much information in it, for which I thank her. I also thank noble Lords who came for the debate on Russian sanctions; I hope they found it informative to hear about pensions.
The phrase that had particular resonance with me was that used by the noble Baroness, Lady Altmann: “spurious accuracy”. When I was a trainee actuary, we were told specifically that making calculations more complex and difficult did not make them any better. Trying to forecast the future is difficult enough. Making complex calculations does not improve the outcome for members.
My major point is that current developments in pensions will require the code to be kept under review in any event, whether they are an increasing appreciation of the risks of climate change or the development of pension scheme surpluses. I welcome the remark about that. These changes accumulate and I hope that the Minister will enjoy further debates and discussions. I look forward, in particular, to the pensions Bill. Not many people say that, but I think we will have some interesting debates.
Motion agreed.
Russia (Sanctions) (EU Exit) (Amendment) (No. 4) Regulations 2024
(2 months ago)
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Baroness Chapman of Darlington
That the Grand Committee do consider the Russia (Sanctions) (EU Exit) (Amendment) (No. 4) Regulations 2024.
Relevant document: 3rd Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, these regulations amend the Russia (Sanctions) (EU Exit) Regulations 2019. This instrument was laid on 5 September under powers in the Sanctions and Anti-Money Laundering Act 2018, and the measures in it entered into force on 6 September as “made affirmative” measures.
In recent years, the UK has transformed its use of sanctions. We have deployed them in innovative and impactful ways, including in our response to Russia’s invasion of Ukraine. This includes our prohibitions on the legal sector. We take a rigorous approach that is carefully targeted to deter and disrupt malign behaviour, as well as to demonstrate our defence of international norms.
In June 2023, a prohibition on legal advisory services, Regulation 54D, was introduced to prevent UK lawyers providing their services to those seeking to continue trading with Russia in goods or services that the UK had sanctioned. This was a unique prohibition that sought to prevent access to our world-renowned legal services market while retaining and upholding the UK values of access to justice and representational advice. Once introduced, it became clear that the sanction had the unintended effect of preventing the legitimate provision of advice on non-UK sanctions compliance, for instance in advising companies on compliance with US or EU sanctions on Russia. A general licence was therefore rapidly implemented in August 2023 as a temporary fix to enable UK lawyers to continue to provide this advice.
This instrument provides the permanent solution and clarifies in legislation the kinds of legal advice that the Government intend UK lawyers to be able to continue to provide. For example, it ensures that advice can be given on compliance with non-UK sanctions, on Russian counter-sanctions and on global criminal law. Receiving this advice is paramount to the functioning of an effective international sanctions response to Russia.
In amending this legislation, a full and thorough review was undertaken, including engaging with esteemed stakeholders in the legal and financial sectors. This engagement has assured us that this amendment will ensure greater clarity for the sector and continue to support our robust and unwavering commitment to cutting off access to our world-leading legal sector from those wishing to advance the interests of Russia.
The review also highlighted a number of other areas for improvement, which have been reflected in this instrument. They include amending Regulation 54D to align more closely with the way the existing circumvention regulations work, creating greater parity between legal advisory services that can be provided to a UK person and a non-UK person. The amendment clarifies expressly that Regulation 54D covers activity outside the UK, meaning that it more clearly operates alongside the existing circumvention regulations and avoids overlapping offences.
We have worked with the sector to ensure that the language in the instrument is as clear as possible regarding the provision of its services. By ensuring that legal advice can continue to be provided for the purposes of non-UK sanctions compliance, we enhance the effectiveness of the sanctions that the UK and our allies have placed on Russia and intensify the pressure on Putin. As well as ensuring that advice can be given on compliance with non-UK sanctions and on Russian countersanctions, we have ensured that advice can continue to be provided on compliance with global criminal law. By protecting the fundamental right to legal representation, we continue to distinguish ourselves from Putin’s oppressive regime.
Lord Purvis of Tweed (LD)
I am grateful for the Minister outlining in clear terms the Government’s position on the wider aspects of the sanctions enforcements. I support this measure. I spoke on the previous regulations on 19 July 2023, when I raised the issue that the Law Society had brought to our attention. It has subsequently had follow-up communications saying that this permanent solution is preferable, and I therefore support it.
I will raise a separate issue that the noble Lord, Lord Alton, spoke to me about—I think he spoke to the Minister prior to the Committee—concerning shipping insurance. I checked Hansard and, on 1 February 2022, I raised a question about this in a debate on one of our early Russia sanctions. The Minister’s colleague, the noble Lord, Lord Collins, heard us raise the continuing concerns in Grand Committee last week. I understand that this has also been raised in a letter today from the right honourable Sir Iain Duncan Smith, the chair of the all-party group on Magnitsky sanctions and reparation, regarding the concerns of 12 vessels that it alleges are continuing to receive insurance via the UK. I hope the Minister might reply on this, although I do not necessarily expect her to give the Government’s response to a letter that was sent to the Foreign Secretary today. But we have an important debate in the Chamber on Friday, so an update from the Government, if possible—written to Members of the Committee and also placed in the Library—would be of assistance to us in our debate on Friday. With that, I support the Government’s moves on these sanctions.
Lord Callanan (Con)
My Lords, I too can be brief. These are of course updates and clarifications of sanctions introduced by the previous Government. We were grateful for the support of the Opposition then and, on behalf of the Opposition now, I offer my full support for the changes that the Minister announced. It is important that we maintain the principle of unity across the parties in support of these sanctions and of Ukraine, taking action wherever possible to restrict Russia and its activities across the world. We need to be mindful of the big role that the City of London plays across the world in legal, financial and professional services. Some UK companies are undoubtedly involved in helping the Russians to circumvent these sanctions. We fully support the strictest clampdown on these activities. We should be very proud of these industries, but they should be used for right, not for helping Russia in this regard.
Following the noble Lord, Lord Purvis, I offer my support for the letter from Sir Iain Duncan Smith to the Foreign Secretary. We support these sanctions but ask the Government to look again at what more can be done to clamp down on the shadow fleet of tankers that Russia is using to spread its oil and gas around the world. As the noble Lord said, I do not expect the Minister to reply now to a letter that was sent only today and probably has not been received yet, but I hope that the Government can bear this in mind and can possibly give us an answer on Friday. We fully support these sanctions.
Baroness Chapman of Darlington (Lab)
My Lords, I am grateful for the support of the noble Lords, Lord Purvis and Lord Callanan. I thank the noble Lord, Lord Purvis, in particular, for his ongoing—I will put it that way—interest in this issue. I very much welcome the comments of the noble Lord, Lord Callanan, on how vital it is that we keep our unity on these issues intact as we move forward. I am grateful and pleased that this is what we have seen today.
On the specific issue about the natural gas tankers, I am grateful to both noble Lords for their forbearance, as I do not have a full response on this today. The insurance is a complex issue. I will endeavour to get a fuller response by Friday. That is not a guarantee but, if I cannot get it by Friday, we will make sure that there is a response to the letter from Mr Duncan Smith.
I will do what I believe is called a pivot, to liquified natural gas more generally. I point out—because it is quite interesting and helpful, although it does not address the issue of insurance head-on—that Novatek, Russia’s largest producer of LNG, suspended production at its flagship Arctic project in April 2024 because of sanctions and a shortage of specialist tankers. This project is critical to Russia’s ambition to triple LNG production by the end of the decade, so we are taking measures that are having some effect on LNG. However, I will come back to noble Lords on the wider issue of insurance.
Iran (Sanctions) (Amendment) Regulations 2024
(2 months ago)
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Baroness Chapman of Darlington
That the Grand Committee do consider the Iran (Sanctions) (Amendment) Regulations 2024.
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, these regulations amend the Iran (Sanctions) Regulations 2023. The instrument was laid before Parliament on 12 September under powers contained in the Sanctions and Anti-Money Laundering Act 2018. The measures entered into force the following day.
The UK has transformed its use of sanctions. We have deployed sanctions in innovative and impactful ways, including in our response to the threat from the Iranian regime. This instrument contains measures to deter the Government of Iran from causing regional and international instability by disrupting their unmanned aerial vehicles—UAVs—and missile industries, and their access to items critical to military development.
The Iranian regime’s development and proliferation of large volumes of advanced conventional weapons, including UAVs and missiles, continues to destabilise the Middle East and prolong Russia’s illegal war in Ukraine. Iran’s use of an unprecedented number of UAVs and missiles during its attack on Israel on 13 April 2024 demonstrated how Iranian weapons development and proliferation is fuelling conflict in the Middle East. The Iranian regime also used hundreds of these arms in its attack on Israel on 1 October, which we condemn in the strongest terms. This attack once more endangered the lives of innocent civilians and escalated an already incredibly dangerous situation. It cannot be tolerated.
In response to Iran’s attack on Israel on 1 October, the UK has designated nine individuals and entities involved in facilitating Iran’s destabilising activity. These include senior military figures and the Iranian Space Agency, which develops technologies that have applications in ballistic missile development. We are deeply concerned about the prospect of further escalation. All efforts must now be on breaking the cycle of violence. At this moment, when tensions are at a peak, calmer heads must prevail. All sides must take immediate steps to de-escalate. A regional war is in no one’s interest.
This is the latest in a long history of Iran destabilising the region, including through its political, financial and military support for its proxies and partners, such as Hezbollah, Hamas, the Houthis and aligned militia groups in Iraq and Syria. We have been clear that Iran must cease this support.
Iran is now one of Russia’s top military backers; it has supplied Russia with hundreds of UAVs since 2022. Russia has used these to target Ukraine’s critical infrastructure and kill innocent civilians, prolonging the suffering of the Ukrainian people. In September, Iran also supplied Russia with hundreds of close-range ballistic missiles. This is a further escalation of Iran’s military support to Russia’s war of aggression against Ukraine and will further enable Russia’s invasion. In return, Iran is receiving Russian military and technological support, enabling it to further develop its military capabilities and enhancing the risk that it poses to the region and beyond.
This legislation expands the UK’s trade sanctions against Iran with the aim of disrupting its UAV and missile industry, as well as its access to items critical to military development. It includes sanctions in relation to items on the Russia common high-priority list. This list was jointly agreed by the UK, the EU, the US and Japan in the context of Russia’s war against Ukraine. It identifies items that Russia is using in its weapons systems, ranging from semiconductors to machine tools.
These items are also significant in Iran’s production of advanced conventional weapons. As the Committee will know, there have been many public reports about Iran’s supply of weapons to Russia. We are therefore prohibiting the export, supply, delivery and making available of these items to Iran through the measures in this instrument. We are also prohibiting the provision of ancillary services associated with the goods, such as brokering services, technical assistance, financial services and funds.
All of the items prohibited by the EU in May have been prohibited by this instrument. In addition, prohibitions will also be applied to some items identified by the Ministry of Defence as significant to Iran’s UAV and missile industries. These trade restrictions complement our existing export controls and sanctions, ensuring that no UK business or person, wherever they are in the world, can facilitate the export, transfer, supply, delivery or making available of these items to Iran without the appropriate licence.
Finally, this Government are committed to enforcement. It is right that we ensure that we have the necessary powers, tools and capacity to implement and enforce our sanctions regimes effectively. That is why, on 10 October, we launched the Office of Trade Sanctions Implementation, with enhanced civil enforcement powers, in order to maximise the impact of the UK’s trade sanctions against Russia. These powers include the abilities to issue civil monetary penalties for breaches and to make details of breaches public. There are also new reporting requirements on sectors well positioned to find evidence of trade sanctions breaches.
To conclude, these new regulations will increase the pressure on Iran’s defence industry. They will disrupt Iran’s production of UAVs and missiles that could be supplied to its proxies in the Middle East or to Russia. We will continue to work with like-minded partners to disrupt, deter and respond to threats from the Iranian regime and to co-ordinate sanctions action. These regulations send a clear message to the Government of Iran and those seeking to harm the UK’s security, as well as that of our partners: we will not stand idle in the face of this aggression. I beg to move.
Lord Polak (Con)
My Lords, I totally support these regulations and agree with every word that the Minister has just spoken. The Iran regime is the problem, not the Iranian people. I remind the Committee that two Members of your Lordships’ House are proscribed by the Iranians: me and the noble Lord, Lord Alton, to whom the Minister referred.
Lord Purvis of Tweed (LD)
My Lords, I thank the Minister for outlining these measures, which I support. I will make an appeal and ask two specific questions, on which I would be very happy if she writes to me rather than responding today.
I agree with everything the Minister said about the role of Iran in the Middle East and its relationship with Russia. My appeal is that we broaden our interests to include Sudan. We know that many of the drones in Sudan have been sourced from Iran. It is the world’s biggest humanitarian crisis at the moment. External actors are providing munitions despite there being no justification at all for any external munitions to be used on civilians in Sudan. I would be grateful if the Minister could write to me with the Government’s assessment of what is currently being used in the conflict in Sudan from external sources, specifically with regard to Iran.
I turn to my questions. First, I absolutely support the prohibition on equipment, but I noticed—if I read the measures correctly—an exemption for the personal property of someone travelling. Does that include designs? Do His Majesty’s Government have any concerns about UK interest in the design of these munitions, not just the provision of equipment to manufacture them? Again, I do not necessarily expect the Minister to outline that today.
Secondly, on the provision or export of goods to third countries that relay trade to Iran, I hope the Government have a response to what could be a particularly easy circumvention of these measures if our trade is with a broker country. We know that much of the equipment being used has multiple components from many sources; I would be grateful if the Government have a response on that. Notwithstanding those questions, I support these measures.
Lord Callanan (Con)
I thank the Minister for her kind introduction to this subject. We also fully support these regulations on drones, broader drone technology, financial services, funds and brokering services related to other items of strategic concern; of course, they are one piece of a much larger jigsaw. The Minister commented on the impact of Iran in our previous debate on Russian aggression in Ukraine.
Both the other noble Lords who have spoken outlined graphically how actively and malevolently Iran is undermining the international order through its support for Hamas, Hezbollah and the Houthis. While it is tempting to think that these are faraway conflicts, any action by the Houthis in the Gulf has the potential to undermine international shipments of oil, gas and other important commodities, which can affect the economy and well-being of this country. Therefore, it is right that we are targeting further the Iranian regime. We fully support these sanctions.
I lend my support to the point made by my noble friend on the proscription of the IRGC. It is strange that so many Conservative Ministers and MPs were in favour of proscription but never managed to get it through the Foreign Office bureaucracy and now so many Labour Ministers and MP who were previously in favour of proscriptions also do not manage to get it through the FCDO bureaucracy. It makes you wonder whether “Yes Minister” was a commentary or a documentary indicating the true state of affairs with the standing bureaucracy in this country. I know that this is difficult, but political will must win over bureaucratic will. I hope that the Minister can influence the Foreign Secretary to return to his previous views and hers and those of her ministerial colleagues and finally proscribe the IRGC. That would meet with widespread support across both Houses of Parliament and from me and many of my noble friends.
We support the sanctions and hope that the Government have success in implementing them.
Baroness Chapman of Darlington (Lab)
My Lords, I again thank noble Lords for their contributions and support for these measures.
On the IRGC, I note the comments of the noble Lord, Lord Callanan, about the frustrations of political life and government. That is all I will say on that line of inquiry. We have already sanctioned the IRGC in its entirety. The separate list of terrorist organisation proscriptions is, as noble Lords know, kept actively under review. We do not routinely comment on whether an organisation is or is not under consideration for proscription. I will leave that there for today.
The noble Lord, Lord Purvis, makes an important point on Sudan. I will write to him about Sudan, but I point out that when sanctions are applied to Iran, they will affect Iran’s ability to supply Sudan as much as it would Russia. That will be the intention. On the issue of personal property, we have in minds such things as laptops, phones and other personal items. It would be restricted to that. It is right to flag this issue, and we are aware of it, but we felt it was important to include it.
This will apply to UK entities and individuals overseas and anyone who is in the UK. It will not apply any more widely than that. This is how the UK organises its sanctions, as the noble Lord knows. I know that he has long had a very keen interest in the issue of secondary sanctions and how we might engage with them. That is the situation as embodied in these regulations and with regard to the UK’s policy towards sanctions more generally. If I have missed a point there, which I think I may have done, the noble Lord must feel free to come back and help me out.
Lord Purvis of Tweed (LD)
It might be my ignorance about how this operates, as it may well be covered elsewhere. I understand that there will be a prohibition on exporting this equipment, but I am not sure that any of it has end-use certificate requirements. Therefore, how will we know if we are sending it to another country which then immediately ships it to Iran? How is that covered?
Baroness Chapman of Darlington (Lab)
I will hopefully improve my note-taking as we go on with this. Brokers would be specifically in breach of sanctions were they to facilitate or knowingly support in any way something ending up with Iran. I hope that helps the noble Lord. If he needs any further information, I would be happy to speak to him about it.
These measures represent a step forward in our capability to restrict Iran’s proliferation of advanced conventional weapons, which continue to fuel conflict in the Middle East and support Russia in its illegal war in Ukraine. The UK Government are firmly committed to using sanctions to hold the Iranian regime to account for its malign activities in the UK and elsewhere. I beg to move.
House of Lords
Prisoners: Early Release Scheme
(2 months ago)
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Lord Sandhurst
To ask His Majesty’s Government what steps they are taking to prevent criminals who have been released under the prisoner early release scheme from reoffending.
The Minister of State, Ministry of Justice (Lord Timpson) (Lab)
After inheriting a prison system on the brink of collapse, we had no choice but to introduce emergency measures, releasing some prisoners a few weeks or months early. Unlike the end of custody supervised licence scheme, or ECSL, introduced by the last Government, SDS40 had an implementation period that allowed prison and probation staff properly to prepare for release, helping us to reduce the risk of reoffending. Planning for release includes having temporary accommodation for those at risk of homelessness; access to employment; and continuity of mental health and substance misuse provision. Those released under SDS40 will also be subject to strict licence conditions. If offenders break those conditions or commit further crimes, they will be punished and could be immediately recalled to prison.
Lord Sandhurst (Con)
I thank the Minister for his Answer and welcome him to Question Time. More than 3,000 prisoners serving terms of more than four years for serious offences are due to be released this week, starting from tomorrow. Martin Jones, the Chief Inspector of Probation, told the BBC that it was a certainty that around one-third would reoffend. Of those released in the first batch in September, how many have been recalled to date in connection with a subsequent suspected offence of violence?
Lord Timpson (Lab)
We do not yet have all the exact figures but, when they are verified, we will publish them in the normal way. However, the noble Lord is correct that we have inherited a system that is very difficult, in which far too many people are recalled. For the second SDS40 stage, we are as ready as we can be. Victim contact data is very reassuring but, as in a lot of areas that we are dealing with in respect of full prisons, it is not as straightforward as I would like.
Lord Carlile of Berriew (CB)
My Lords, given the number of prisoners who become dependent on drugs before, during or after leaving prison, what steps will the Government take to ensure that better treatment, and psychological treatment in particular, is available to them, whether they are released early or at the normal time?
Lord Timpson (Lab)
I thank the noble Lord for the question. Some 49% of prisoners have drug misuse problems. It is clear that those who go into prison drug free sometimes come out addicted to drugs. Drug-free wings and other NHS and support services are vital; they work—but they also need to work when people leave prison too. With the SDS40, we have had more time to plan these releases. While eight weeks is not perfect, it is far better than the previous early release scheme—so we are confident that these links are there and are working. One thing that I am confident of, having been around prisons for so long, is that, when you have prisons that are so full, it is difficult to make everything work as well as it should do.
Lord Watts (Lab)
My Lords, does the Minister agree that under the last Government, we saw the decimation of the Probation Service, putting the public at risk? How long does he think it will take to repair the damage done by the last Government?
Lord Timpson (Lab)
The noble Lord is correct that probation is under a lot of pressure and our probation colleagues do an amazing job in these difficult situations. I have been fortunate to spend a lot of time since I have taken on this role visiting probation staff around the country, and although we are recruiting an extra 1,000 probation staff by March next year—that is on track and going well—it takes time to train people and for them to gain experience, because much of their role is about relationship building and understanding the challenges that offenders face.
Lord German (LD)
My Lords, one way in which the prison population could be reduced would be to deal with prisoners on remand, who are one in five of all prisoners at the moment. They do not have any access to meaningful activity, and we need to move the process along by which they have their cases heard. Can the Minister tell the House what steps have been taken to reduce the remand population and when we are likely to see that reduction taking effect?
Lord Timpson (Lab)
I am afraid I would not want to put a date on when things are going to change, but I assure the noble Lord that the remand population of 17,000 is far too high. He is right that a number of prisoners who are on remand do not engage as well as they should in all the opportunities they have to turn their lives around—for example, education and purposeful activity. Changing magistrates’ sentencing powers to 12 months will free up Crown Court time to reduce the backlog, and this will reduce time spent on remand.
Lord Farmer (Con)
My Lords, what help is being offered to families who experience difficulties when a prisoner returns home earlier than expected? Is the Minister familiar with the prison-based family hub that Spurgeons is running in HMP Winchester? This connects families with a full range of support local to their homes and works with them in full respect and recognition that they are often the most effective front-line rehabilitation asset in released and serving prisoners’ lives.
Lord Timpson (Lab)
I thank the noble Lord, Lord Farmer, for his question and for the incredible work he has done over many years in this area. One of the benefits of SDS40 is that it provides an opportunity to plan for release, compared to the previous ECSL scheme. Strengthening family ties remains a focus of the Ministry of Justice and HMPPS, and we are working with our partners to deliver a service that helps families and loved ones build and maintain positive relationships, including those released earlier than they would previously have been. For example, our family support workers help to re-establish family ties where appropriate and, critically, help to facilitate visits from prisoners’ children. I am hugely grateful for the work of Spurgeons and of the many charities and volunteers whose dedication helps prison leavers resettle into society, supporting them and their families at such critical times. The hub it runs at HMP Winchester is an excellent example of this.
Lord Bradley (Lab)
My Lords, I declare my interests as in the register. Does the Minister agree that to help address reoffending, wherever possible prisoners should have access to the excellent NHS Reconnect service in advance of release? This tries to address continuity of care for people with mental health and related conditions as they return from prison into the community.
Lord Timpson (Lab)
I thank my noble friend for that question. He is completely right that continuation of care through NHS Reconnect is so important. In my office about two hours ago, we were having a meeting on this exact subject. I was fortunate to spend two days working in HMP Preston, following the officers around, and it was very clear to me that there were a lot of men in that prison who were very ill and that what they needed was the care of our fantastic NHS colleagues.
Lord Laming (CB)
My Lords, does the Minister agree that the Probation Service needs all the help it can get to focus entirely on preventing further criminal acts by people who have been discharged from prison? Somehow the Probation Service seems to have lost some of its sharp focus on that, and preventing recidivism should be its key task.
Lord Timpson (Lab)
When 80% of offending is reoffending, something is clearly not working. I will give the noble Lord an example. When I was opening a probation delivery unit in Preston, there was a man standing outside with a sleeping bag around his neck. It was very clear that if he was to spend the night on a park bench, he was probably going to reoffend straightaway. There is an awful lot of work to do, but the focus needs to be on addressing people’s mental health, their addiction, accommodation and employment needs.
Baroness Redfern (Con)
The highest cohort of reoffenders is 15 to 17 year-olds, with temporary accommodation the main barrier to supporting them. What targeted interventions will the Government consider to alleviate this barrier for that group of very young people?
Lord Timpson (Lab)
Accommodation is a big driver in cutting reoffending. Having been brought up in a home full of foster children, I am well aware of the problems of accommodation. It needs not just to be decent accommodation; it needs to be accommodation where their needs are understood, and they have the opportunity to receive care and kindness from experts who understand the challenging difficulties these young people have—especially around issues of attachment and mental health.
Early Years Provision: Bell Review
(2 months ago)
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Baroness Barran
To ask His Majesty’s Government whether they plan to publish the main findings of Sir David Bell’s review of early years provision, commissioned by the Labour Party in October 2023.
The Minister of State, Department for Education (Baroness Smith of Malvern) (Lab)
The early years sector is facing shortages of places and workers, and it will be challenging to deliver the entitlements promised by the previous Government. Sir David Bell’s review, undertaken for the Labour Party prior to the election, considered how to ensure all children have access to high-quality early years education. The Government are considering how to reform the sector and will set out further information next year. Sir David’s findings will inform that work.
Baroness Barran (Con)
My Lords, when in opposition, the Secretary of State for Education repeatedly said that childcare was her No. 1 priority, but she also said that she was unable to set out her plan until Sir David Bell had completed his review. Given that the Government have now committed to roll out the previous Government’s childcare plan to increase entitlements, can the Minister confirm whether or not Sir David recommended continuing with the Conservative Government’s plan, and did he agree to the levels of fees we had published? If so, it is really puzzling that the Government will not publish his recommendations; if not, I think there is a greater reason to know what they are.
Baroness Smith of Malvern (Lab)
Importantly, having made it clear that we want to deliver the entitlements set out by the previous Government, this Government have started the hard work to put in place the action necessary to do that. It will not be easy; I am afraid that we inherited a pledge without a plan to deliver it. Having ensured that 320,000 children have been able to take up this year’s additional entitlement, the Government’s focus is to make sure we have the places and workforce to enable the growth of that entitlement, which we will try to deliver in September 2025. However, it will be a difficult task, made more difficult by the planning failure of the previous Government.
Lord Storey (LD)
Sir David is clearly a man of integrity, great educational experience and knowledge. We understand that because the report was leaked, he decided that he was not going to continue and publish it. However, I hope that some of the key elements of that report—not least introducing a new qualified teacher route—will be included in legislation that comes before us. In fact, after Questions, we will be considering the Minister’s Statement on early years. Can the Minister confirm that the proposal to increase the early years pupil premium, whether it came from Sir David or not —it has not yet been published—will be considered at some point?
Baroness Smith of Malvern (Lab)
While we are ambitious for early years and childcare, we will need to consider the outcome of the spending review in thinking about where we can focus our resources. We intend to produce an early years strategy early next year, which will certainly build not only on what we have learnt in government and our work engaging with stakeholders and the dedicated staff in early years and childcare, but on Sir David’s recommendations.
Lord Young of Cookham (Con)
Does the Minister agree that to deliver the programme, we will need another 35,000 people working in childcare by this time next year and 6,000 by the end of this year? How confident is she that she will find the necessary people?
Baroness Smith of Malvern (Lab)
The noble Lord is right about the challenge for the workforce. That is why, last week, as he says, we published further information about the 75,000 additional staff that will be necessary. It will be a challenge, but we have already begun work, focusing on the Government’s childcare recruitment campaign, “Do Something Big”. We have also introduced a T-level in early years and childcare, and through Skills England we will be identifying the gaps and ensuring that the support is there for employers to develop staff in this area. But it will be a very big challenge to make sure that the places and people are there to deliver the entitlement by next September.
Baroness Butler-Sloss (CB)
My Lords, many young mothers are not very good at looking after their very young children. What are the Government doing to help mothers and children bond and learn to look after each other?
Baroness Smith of Malvern (Lab)
In my case, I could say that slightly older mothers were probably not particularly good at looking after their young children either.
The noble and learned Baroness makes a very important point about the support we provide for mothers, obviously through midwives and antenatal care, which I know my colleague in the Department of Health and Social Care will be very concerned about, and we will hear her views. In ensuring we have early family support, particularly for the most vulnerable families, we will also help to overcome that problem.
The Lord Bishop of Leicester
My Lords, in his review, Sir David Bell looked at the attainment gap between children from less privileged and more privileged backgrounds. Can the Government commit to ensuring that the ministerial taskforce on child poverty will look at the impact of the current benefits system on children from lower-income families?
Baroness Smith of Malvern (Lab)
The right reverend Prelate is absolutely right to identify that disadvantage —in fact, special educational needs impact on children at a very early stage in their development. My right honourable friend the Secretary of State for Education, alongside the Secretary of State for Work and Pensions, is absolutely committed, through the work of the child poverty taskforce, to looking at precisely how we break that link between poverty in childhood and the ability to make the most of your life later on. That will include elements of the benefits system as well.
Baroness McIntosh of Hudnall (Lab)
Taking my noble friend back to the question on recruitment, will she consider that a number of the people who will be needed in the workforce are currently in full-time education? Quite a lot are at school, and many are studying BTECs—for example, in health and social care—which can then lead them into careers in childcare. Can she say whether the Government intend to go on supporting the BTECs that will take these young people towards the childcare sector? What else are the Government doing to encourage young people currently in education to see it as a good career path for them?
Baroness Smith of Malvern (Lab)
We are carrying out a short qualifications reform review precisely to identify the qualifications where there are particular needs for learners or for the economy—in this case, childcare. Unlike the previous Government, we are saying that where we can see for both those reasons that there is a particular need for qualifications, we will continue to fund them in the system. As I identified earlier, we are also supporting the development of a T-level, which will provide a very good and rigorous route for young people into the childcare sector. Also, through the “Do Something Big” campaign we are encouraging more people to consider a career in early years and childcare, which can have such an enormous impact on children’s lives.
Lord Kirkhope of Harrogate (Con)
My Lords, what is so encouraging is the way fathers are now involved in looking after children, and it is very important—
Lord Kennedy of Southwark (Lab Co-op)
My Lords, we will turn to the Cross Benches next, and then we will hear from the noble Lord.
Baroness Boycott (CB)
My Lords, we have just come to the end of a report on ultra-processed and HFSS foods. When it comes to early years nutrition, it is quite a Wild West out there. For a start, we have the lowest rate of breastfeeding in Europe and the OECD, because there is very little support. When you get on to infant feeding formula, a lot is marketed at babies who are younger than six months and there is extreme confusion about the way that milks can be advertised.
Baroness Boycott (CB)
My question is: will the Government take heed of our report and look at the way products are marketed to mothers when they are young, vulnerable and not very well off?
Baroness Smith of Malvern (Lab)
I am sure that my colleagues in the Department of Health and Social Care will look closely at that, given their concern to ensure that babies and children have the healthiest start in life.
Lord Kirkhope of Harrogate (Con)
My Lords, I was saying that it is quite inspirational how fathers, particularly young fathers, are now much more involved in bringing up young children. We should recognise that sharing of responsibilities in many families. What do the Government say about that? What more can be done to encourage fathers to get more involved in bringing up their young children?
Baroness Smith of Malvern (Lab)
The noble Lord makes a very important point. I know from personal experience that, where fathers can give that care, it has an enormously important impact on children and their development. Obviously, over recent years we are more able, through parental leave provisions, to share that leave at the early stages of children’s lives. I assure the noble Lord that, across government, we will continue to think about ways we can support parents, including fathers, in doing that very important role.
Social Housebuilding
(2 months ago)
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Baroness Warwick of Undercliffe
To ask His Majesty’s Government what plans they have to build capacity in councils and housing associations within the next three months to increase the building of new social homes.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank my noble friend for her Question and for all the work she has done to support the social housing sector. The Government are committed to the biggest growth in social and affordable housing for a generation, but we recognise that councils and housing associations need support to build their capacity. In July, we announced steps to help with delivery, including flexibilities in the current affordable homes programme and for councils to use right-to-buy receipts. We will set out plans in the Budget at the end of this month to give councils and housing associations the rent stability they need to borrow and invest in both new and existing homes.
Baroness Warwick of Undercliffe (Lab)
My Lords, I thank my noble friend the Minister for her very helpful and hopeful reply. Recent statistics from the ministry show that, in the year 2023-24, 320,000 households faced or experienced homelessness—an 8% rise on the previous year and the highest on record. Recent research by the NHF, Savills and the HBF warned that, without much more social housing, the Government are set to miss their target of 1.5 million homes. A significant uptick in social housing is vital to plug that gap. Will my noble friend explore the options of a one-year extension to the affordable housing programme in the upcoming October Budget? Extension of the current AHP by one year would be an important first step to increase delivery and capacity in the social housing sector.
Baroness Taylor of Stevenage (Lab)
At the risk of repeating my noble friend Lord Livermore, the content of the Budget is of course a matter for the Chancellor of the Exchequer. However, the package we announced in July included flexibility in the current affordable homes programme to help with delivery and extended the 2021-26 affordable homes programme. We have been clear that we will bring forward details of future government investment in social and affordable housing at the spending review. We know how important it is to enable providers to plan for the future as they help to deliver the biggest increase in affordable housing in a generation.
Lord Best (CB)
My Lords, I congratulate the Government on the priority it is giving to new housebuilding for social rent, but we are still losing more homes each year than we are building, mostly because of right to buy. Some 2 million homes have been sold so far and 40% are now in the hands of private landlords, who are letting homes at rents two or three times higher than at which they would have been let as council properties. Would the Minister accept either or both recommendations from the Devon Housing Commission, which I have been chairing? The first is that the level of discount should be set by the local authority and not at the national level, where 70% discounts are available, which is not good value for the taxpayer. The second is around whether 100% of the proceeds from sales of right to buy should be allocated to new housing that replaces that which has been lost.
Baroness Taylor of Stevenage (Lab)
I am grateful to the noble Lord, Lord Best, for his work with the Devon Housing Commission; I have been very interested to read about its work. The Government believe it is right that long-standing social tenants should retain the right to purchase their property at reasonable discounts, and so we will not be ending the right-to-buy scheme. However, many of the homes sold since 2012 have not been replaced and, as our manifesto said, the Government are reviewing the increased right-to-buy discounts, introduced in 2012. We will bring forward more details and secondary legislation to implement changes later this year. We will also review right to buy more widely, including looking at eligibility criteria and, in particular, protections for newly built social housing. We will bring forward a consultation on that shortly.
Baroness Pinnock (LD)
My Lords, does the Minister agree that affordable housing and housing for social rent are quite distinct offers? Frequently, the Government, previous and current, seem to fall into the pattern of using the word “affordable” for housing that is seriously not affordable and not distinguishing social housing for rent. Will the Minister be very clear that, when we talk about the need for social housing, we talk about social housing and not affordable housing?
Baroness Taylor of Stevenage (Lab)
I have made my views on that subject very clear in this Chamber many times before. We intend to support the delivery of the right kind of affordable homes to meet local needs. Our proposed changes to national planning policy will set out clear expectations that housing needs assessments must consider the needs of those requiring social rent homes. Local authorities should specify their expectations for social rent as part of a broader affordable housing policy. We are also removing the prescriptive requirements that currently tie local authorities’ hands, with respect to particular types of home ownership products. This will allow them to judge, as they are best placed to do, which type of housing is best for their local area.
Baroness Penn (Con)
My Lords, London has some of the highest housing pressures in the country, including for new social housing, and yet the mayor consistently fails to deliver on his own targets. Could the Minister explain why the Government are withdrawing from an intervention in London designed to reverse that record?
Baroness Taylor of Stevenage (Lab)
I welcome the noble Baroness back to her place. I have set out our views about delivering the biggest increase in social and affordable housing. We have asked Homes England and the Greater London Authority to maximise the number of social rent homes when allocating the remaining affordable homes programme funding. Significant sums of that funding have indeed been dedicated to London. We are extending the programme’s completion deadline for all schemes in London from March 2029 to March 2030, and we are enabling the Greater London Authority to fund intermediate rent homes, within the 2021-26 programme, at a maximum of 80% of market rents. I hope that reassures the noble Baroness that we take the issue of housing in London seriously.
Baroness Winterton of Doncaster (Lab)
My Lords, does my noble friend the Minister agree that one of the consequences of a lack of social and council housing has been the growth of houses in multiple occupation? Can she assure me that she will look at giving councils adequate powers to deal with houses in multiple occupation, which can cause problems not only for those living in them but for local communities?
Baroness Taylor of Stevenage (Lab)
I agree that some houses in multiple occupation cause problems, but they can also provide a low-cost housing solution at certain times. However, it is important that local authorities have the powers to deal with this in their own areas. Following the recent consultation on the National Planning Policy Framework, we will look carefully at councils’ responses to see whether they have requested further powers to deal with HMOs.
Lord Shipley (LD)
My Lords, the Question relates primarily to new social homes, but it was reported at the end of September that around 70,000 council and housing association homes are now lying empty. Can the Government say something about what is planned for those 70,000 dwellings?
Baroness Taylor of Stevenage (Lab)
My Lords, there are multiple reasons why properties may be empty, but it is important that we bring as many homes as possible into use. Councils are being given greater powers to charge additional council tax for empty properties, and I know that they will be looking very carefully at the stock of housing to make sure that it is brought into use as quickly as possible. We are also looking at things such as compulsory purchase order powers and so on. Councils already have those but it is very important that we give councils as many tools in their armoury as possible to prevent houses falling into dereliction or simply being left empty because they have been bought as investments and are not let out or used.
Lord Young of Cookham (Con)
My Lords, the Minister said a few moments ago that she could not anticipate the Budget Statement, but did not the Sunday Times do that yesterday, with an authoritative leak that local authorities are to spend £1 billion more on council houses? I welcome that, but how confident is she that there is enough capacity in the construction workforce to respond to that demand?
Baroness Taylor of Stevenage (Lab)
The noble Lord makes an important point. I will not comment on leaks, to the Sunday Times or anywhere else, but I have been talking extensively with the development industry about skills in that area, not just for traditional methods of construction but to deal with modern methods of construction and the whole range of new skills that we will need to fit properties to make sure that they are net zero. We are looking right across the board at that and working with the construction industry to see what needs to be done to help it develop the level of skills that we know we are going to need.
Lord Sahota (Lab)
My Lords, last week, the Government allocated £68 million for 54 councils to build social housing on brownfield sites. Will there be further funding for other councils for similar projects to build houses on brownfield sites?
Baroness Taylor of Stevenage (Lab)
I thank my noble friend for drawing attention to the brownfield land release fund. The Government’s preference is to use brownfield first; we want to turn neglected sites into new homes. This funding will help clear empty buildings, former car parks and industrial land to make way for homes. We think that the first tranche of funding will enable around 5,200 homes. Further announcements on this will be made at the time of the spending review.
Independent School Fees: VAT
(2 months ago)
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Lord Hacking
To ask His Majesty’s Government what estimates they have made of the pupil migration arising out of the proposed VAT on independent school fees, and what is the exact basis of such estimates.
The Financial Secretary to the Treasury (Lord Livermore) (Lab)
My Lords, in July, the Government set out their view that the number of pupils who may switch schools as a result of these changes represents a very small proportion of overall pupils in the state sector. Projections from the Institute for Fiscal Studies suggest that this is likely to represent less than 0.5% of total UK state school pupils, with any movement expected to take place over several years. At the Budget, the Government will set out our assessment of the expected impacts and a tax information and impact note. This assessment will be consistent with the costings of this policy by the Office for Budget Responsibility. In making this assessment, the Government will consider pass-through of VAT to school fees as well as the likely elasticity of demand.
Lord Hacking (Lab)
My Lords, I am very grateful to my noble friend for answering my Question. He cites the IFS report that advised that there would be a very small pupil migration of between 3% and 7%. The question is whether that is correct. Do the findings of the IFS provide any clear indication of parents’ ability to pay a 20% increase in the cost of school fees? Also, should not the Government listen to the parents of pupils in independent schools in the various parent surveys? In recent surveys, between 18% and 26% have said that they will not be able to pay this increase and will have to take their child or children out of independent schools.
Lord Livermore (Lab)
At the Budget, we will set out an assessment of the expected impacts of this policy in the normal way by publishing a tax information and impact note. In this assessment, we will consider, first, the likely pass-through of VAT to school fees. Here, after a cover of VAT on input costs, we expect schools to be liable for VAT of an average of around 15% of their fee income. The Government expect that private schools will take steps to absorb a significant proportion of this VAT liability. Secondly, we will consider the likely elasticity of demand, which will be consistent with the elasticity used by the OBR in the costing of this policy. It is worth noting that, despite a 75% real-terms increase in fees since 2000, the number of children in independent schools has remained steady, which suggests an inelastic demand for private school places.
Lord Lexden (Con)
Should we not all be grateful to the noble Lord, Lord Hacking, who has sent a very thorough report to the Prime Minister, showing the dire consequences that the Government’s education tax will have? Is it not time that the Government realised that their education tax—the first in our history—is likely to force a large number of parents, particularly those using small special needs schools in the independent sector, to move their children next term to state schools which are wholly unprepared for them?
Lord Livermore (Lab)
The answer to the noble Lord’s question is no, because the assumptions underlying that report are incorrect. We expect that a large number of private schools will take steps to absorb a significant proportion of this VAT liability, so the majority of that fee will not be passed through.
Lord Vaux of Harrowden (CB)
My Lords, 3,000 military families take advantage of the continuing education allowance and send their children to private school. In previous answers, the Minister has said that no decision will be taken on how the impact of the VAT rise will be dealt with for those families until the spending review. The Armed Forces are facing a retention crisis, as is well known. Why does the Minister think that leaving those families with this level of uncertainty is going to help with that retention?
Lord Livermore (Lab)
The core answer to the noble Lord’s question is that very many private schools will take steps to absorb a proportion, if not all, of the new VAT liability, so there may actually be no increase in fees in such circumstances, which is why it is right that we leave it until the spending review. It is worth pointing out that very many military personnel send their children to state schools and want them to benefit from the improvements that will happen in those schools.
The Lord Speaker (Lord McFall of Alcluith)
My Lords, the noble Lord, Lord Campbell-Savours, is participating remotely.
Lord Campbell-Savours (Lab) [V]
Why not positively foster pupil migration from the public schools into the state boarding school sector, such as Keswick School, a comprehensive in the Lake District? They offer a far wider social mix, often higher standards of education, help to foster far more balanced social interaction among the young, and all at a fraction—often one-third —of the cost. Is this discussion about not just tax receipts but breaking down social division that can begin in childhood and later divide society?
Lord Livermore (Lab)
I am very grateful for my noble friend’s insights. I will take those on board.
Lord Storey (LD)
My Lords, the Minister keeps saying, “Our modelling, our predictions” et cetera. What happens if they have got it wrong? If, for example, 10%, 20% or 30% of pupils leave the private sector, have the Government made contingency plans to ensure a sufficient number of teachers and sufficient provision? A point was made about special needs schools. Many children in the private sector are in special schools providing a particular type of provision. Will that be available in the state system?
Lord Livermore (Lab)
The noble Lord asks about the assumptions we are making. As I said, we will set out our assessment of the expected impacts of this policy in the normal way by publishing a tax information impact note at the time of the Budget. At that point he can judge those assumptions for himself.
Baroness Vere of Norbiton (Con)
According to the Government, VAT is a tax on consumption and therefore falls on the parents. Yet the Minister keeps saying that this consumption tax will be absorbed by the producer—the schools. Many noble Lords have pointed out today that schools cannot simply magic up lots of cash to mitigate against this consumption tax on the parents. Has he considered that he is undermining what a tax on the consumer actually is?
Lord Livermore (Lab)
The noble Baroness will know that how schools will fund this additional cost is a commercial decision for each school. Some schools have already announced a very wide range of fee increases, from zero to 5%, to 10%, up to, for example, Eton at 20% above the average expected VAT liability. This reflects the Government’s expectation that private schools will take steps to absorb a significant proportion of the new VAT liability.
Lord Kennedy of Southwark (Lab Co-op)
Can we hear from the noble Baroness, Lady Foster?
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I am grateful to the noble Lord. Is the Minister aware of the disproportionate impact that this tax will have on Christian schools in Northern Ireland given the structure of the education system there? Given that, will a specific impact assessment be carried out?
Lord Livermore (Lab)
The impact assessment will cover the full range of expected impacts.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, is the Minister aware that many of us think that taxing the schools like other private enterprises is long overdue? Will he confirm that, in the case of the sons and daughters of MoD and FCDO personnel, it is in fact just a transfer from one government department to the other and has no net impact?
Lord Livermore (Lab)
I absolutely agree with the spirit of my noble friend’s point. This is a necessary decision that will generate additional funding to help improve public services, including the Government’s commitments relating to education and young people. The Government are committed to breaking down barriers to opportunity and determined to drive up standards in those schools serving the overwhelming majority of children in this country.
Lord Markham (Con)
What is clear from the comments is that this is all built on a number of assumptions that clearly could be incorrect. Given that the whole objective of this is to raise money, will the Minister undertake a review a year from now when this has been in place to see whether those assumptions were borne out, or, as we suspect, it has ended up losing money and will be repealed?
Lord Livermore (Lab)
The Government are extremely confident in our costings. We expect this policy to raise significant amounts of revenue. The Office for Budget Responsibility will certify the Government’s costings at the Budget. Of course, one keeps all tax policy under review.
Baroness Butler-Sloss (CB)
Do the Minister and the Government realise that we are talking about not only Eton, Winchester and Westminster? There are a large number of small independent schools serving local people on relatively low fees. They are the ones that will fail, in Northern Ireland and other places. There is no point reviewing it in a year’s time—they will be closed and those children may or may not find sufficient places in the local state schools.
Lord Livermore (Lab)
I disagree with the assumptions that underlie the noble and learned Baroness’s assumptions. As I said, some schools have already announced a very wide range of fee increases, from zero to 5% and up to 10%.
Government’s Childcare Expansion
(2 months ago)
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Baroness Barran (Con)
I welcome the Statement made in the other place last week on the Government’s childcare expansion, although I note that it might have been more constructive had the Minister acknowledged the transformation in childcare provision implemented by the previous Government and I hope the Minister can acknowledge that for the House today. I remind your Lordships that there were five major stages of that expansion. In 2010, we extended the entitlement for three and four year-olds, commonly taken as 15 hours a week for 38 weeks of the year. In 2013, we introduced 15 hours a week of free early education for disadvantaged two year-olds. In 2017, we built on that by doubling the entitlement for three and four year-olds to 30 hours a week and then in 2023 we announced measures to give working parents 30 hours a week of free childcare from nine months until the child starts school, building up over two years. This constituted the biggest expansion of childcare by any UK Government in history.
I would like to ask the Minister a few questions. First, the previous Government, now on this side of the House, are delighted that the Government have committed to continuing our expansion of childcare, but I was concerned that the tone of the noble Baroness’s comments when answering an earlier Question on this subject sounded like a pitch-rolling to cut the offer and I wonder whether she could just reassure the House that that is not in the Government’s plans and set out the Government’s commitment. Certainly, there was a sense that the communications around this September’s rollout were perhaps more muted than we had expected. It is obviously critical that parents are aware of their future entitlements.
If I may, I will try to ask the Minister again whether Sir David Bell did recommend in his review of early years to continue with the previous Government’s approach to childcare and whether she could confirm when the Government will publish the early years workforce strategy. Also covered in the Statement were the Government’s plans for implementing breakfast clubs and that the Government were taking a test-and-learn approach. I was puzzled by that, given that the previous Government already had a national school breakfast programme that was active in almost 2,700 schools and, as the Minister knows, many primary schools offer breakfast clubs already, I wonder what particular aspects the Government feel they need to test and learn from.
Finally, in relation to school-based nurseries, can the Minister give the House a sense of how confident she feels about the Government’s target of opening the first school-based nurseries by September 2025, with the new funding? It looks like quite a short period to turn that around. Also, what assessment has been made of the impact of the imposition of VAT on the nursery provision of independent schools that have that provision?
Lord Storey (LD)
My Lords, we on these Benches welcome the proposals; they are very much in line with our manifesto at the last election. I believe that all three parties, in perhaps slightly different ways, have a real desire to develop childcare provision. I want to tease out from the Minister the most important thing for early years childcare provision: the quality of the staff and the staff feeling valued. That means not just the salary but the training opportunities they get.
Over the last decade or more, we have seen staff in nursery and early years settings feeling that they are there just as glorified helpers. One nursery nurse said to me, “I could get more stacking the shelves at Lidl than I get in my job in a nursery”. If we want brilliant early years education, we need staff who feel motivated and want a career in that line of work. I had a 100-place nursery in a primary school and I remember how the staff were absolutely devastated when their names were changed from “nursery nurse” to “NVQ level 4”. They hated that. There had been no consultation with them at all; it just happened as part of the skills agenda. That is my first point.
My second point is that, while we welcome the commitment on top-up charges, we have also to recognise that the income generated in private nurseries sometimes caused real problems for them; but doing away with top-up charges is absolutely correct.
I like the notion that we increasingly put nurseries in primary schools, where there is capacity. Why? Because the primary school can provide all the other things that are available there: advice on special educational needs, and a whole host of other opportunities.
I am pleased about childminders—although I do not actually like the title “childminder”. They do not just mind children; they develop children. They get them to play, to interact, to talk, to learn and to discover. They do more than just minding—but I suppose we are stuck with that title. Childminders were very concerned several years ago when there was a movement towards doing away with single childminders; they had to be part of a company or a group. I thought that was wrong. So I recognise and welcome the proposals on childminding. It should not be a sort of privatised provision. Anybody who has the qualifications and experience should be allowed to do it.
I want to make a final point. There is an aspiration to go to 30 weeks’ provision, but that provision does not cover a full calendar year. Nurseries—particularly private nurseries—find it very difficult because, at the end of the 30 weeks of provision, some parents, especially those from deprived communities, cannot pay the additional money, so they withdraw their children for that period. The nursery or early years setting then finds it difficult to financially survive. So, we need to look at how we ensure that there is equity for the provider as well.
The Minister of State, Department for Education (Baroness Smith of Malvern) (Lab)
I thank the noble Baroness and the noble Lord. I am very happy to accept that there has been an enormous transformation in the country’s attitude to childcare and in the extent of childcare available. When I entered the other House in 1997, following a considerable period of Conservative rule, we in Worcestershire were infamous for having the worst childcare provision across the whole of Europe. I am glad that people have seen that childcare and early years provision is important for people’s ability to go to work and, at this moment in time, to support people with the cost of living, but I think that the additional area where we need to focus more attention is that good early years provision is absolutely fundamental for children’s development and giving them the very best possible start in life.
The noble Baroness suggested that the Government are pitch-rolling away from the pledge to entitle working parents to 30 hours of childcare a week from 2025; that is absolutely not the case. The Government are committed to providing that, but we are being transparent and honest about the challenge it will bring. As we said last week, it will mean another 75,000 childcare places and over 30,000 more staff will be necessary; that is a big challenge that needs a plan, not just an aspiration.
I am sorry that the noble Baroness thought that the comms at the beginning of the school year were a little on the quiet side; I did a whole morning media round on this and shouted it from the rooftops. I am pleased that we were able to celebrate 320,000 more parents getting their childcare entitlement this year, but there is certainly more that we need to do. That is why we will work to look more strategically at what we need to do to develop the early years sector and have undertaken to develop a strategy, which I expect us to publish and bring to this House next year.
The noble Baroness asked about breakfast clubs. A few weeks ago, we were able to announce the 750 trailblazing breakfast clubs that will be open by next year, which will build on previous work to get breakfast clubs into schools. However, we are also making a stronger commitment both to providing these free for all primary school pupils and to ensuring that the childcare element of the breakfast club is also in place—that is a very important way that we get children to school early and ready to learn, which does not necessarily happen just if you have a breakfast club, despite the excellent work those breakfast clubs are doing.
On school-based nurseries, the noble Baroness is right that we announced last week £150 million of funding which schools can bid into, so that we can develop up to 300 school-based nurseries as part of our objective to have 3,000 of those over the course of this Parliament.
The noble Lord is absolutely right that, if we are to achieve quality early years provision, we need to develop even further the brilliant staff who are working in early years and childcare. That means we need to reset our relationship with the childcare workforce, ensure that there is appropriate status for that role and think about training. We have already begun to provide, for example, more guidance around how to identify special educational needs, and we will want to continue that work.
We are taking action on ensuring that mandatory extra top-up charges are not levied on parents who take up government-funded childcare places, and we will be working with the sector and with parents in order to make sure that we strengthen that guidance.
Childminders do excellent work, but we have seen a halving of the numbers of childminders over recent years. The flexibilities, including the additional flexibilities announced last week, will help to ensure that childminding remains an important element of the childcare environment.
The noble Lord raised a point about flexibility for school holidays. It is already the case that quite a lot of childcare provision, including that provided around schools, continues into the school holidays. However, in thinking about our overall development of provision and our strategy, we will certainly want to think about how we can ensure that that is as flexible and well supported as possible for parents to be able to use all year round because of the enormously important impact that it has on those parents and, more importantly, on children’s best start in life.
Baroness Barran (Con)
Before the Minister sits down, I wonder if she could clarify something. I heard her say that there was a £150 million capital pot for nurseries, but I think I read in the Statement that it was £15 million. If she cannot confirm that now, maybe she could write to us.
Baroness Smith of Malvern (Lab)
I apologise. The noble Baroness is absolutely right. I have been overambitious on the Government’s spending plans and I will be in big trouble for that. The figure is £15 million for up to 300 new or expanded nurseries. I thank the noble Baroness for allowing me to correct that.
Baroness Blackstone (Lab)
My Lords, I welcome the decision by the Government to expand early-years provision, both education and childcare, but the Statement does not perhaps go far enough in clarifying some of the issues that are likely to emerge from that policy decision. The first, as the Statement makes clear, is that we do not have enough staff to carry out this expansion, certainly not in the timescale that the Government are hoping to achieve. What discussions are taking place with the providers of teacher education and training to try to increase the numbers of young people deciding to become teachers and who take on specialisation in the early years, particularly for three to seven year-olds?
Secondly, what will the role of head teachers be in this slightly complex set-up where, on school premises, there will be not just an expansion of nursery classes but also the provision of childcare for younger children? What responsibility will head teachers have to take for what is going on on their premises in relation to childminders, private providers of one kind or another or voluntary organisations? Certainly, parents will imagine that head teachers have some responsibility for what is happening on their premises.
Lastly, what work is being done to integrate the educational aspect of provision with the childcare aspects of provision? The Minister has rightly said that it is important for the development of children that this expansion takes place, but that expansion must bring with it high standards of provision. Indeed, the Statement says it is the Government’s priority to provide such high standards. Could the Minister respond to those questions?
Baroness Smith of Malvern (Lab)
My noble friend is right that having sufficient well-qualified staff is one of the biggest challenges for developing the entitlement in early years. That is why, as I outlined earlier, we have a national recruitment campaign, we are piloting whether financial incentives will boost recruitment in early years, we have skills boot camps for early years that lead to an accelerated apprenticeship, we have the new T-level, and Skills England will look at the sector to see what more qualifications we need to have in place. We are providing additional flexibility for childminders to help to care for children and to come into childminding through the childminder start-up scheme.
The DfE currently supports a pipeline of early years teachers into the sector by funding early years initial teacher training and developing an undergraduate early years teacher degree apprenticeship to support early years leaders and teachers to earn while they learn. My noble friend is right that the range of provision within a primary school is a challenge for a head teacher, but we also heard from the noble Lord, Lord Storey, some of the benefits that head teachers will find from having that early start for children, with all that it brings to their development.
On the quality and scope of early years, we made some announcements last week about ensuring that, as we develop the scale of the provision, we do not lose quality through new provisions around the early years foundation stage. We will also want to continue thinking about how we can ensure that the highest quality of learning happens during that stage. We will undoubtedly have more to say about that as we develop the quality and extent of early years care.
Lord Laming (CB)
My Lords, I very much welcome this Statement, especially the section that reads:
“The Government believe that all children deserve access to a brilliant early education, regardless of who they are, where they come from or their parents’ income”.
The Minister will share my concern about young children who either are not registered at nursery school or are registered but rarely attend. What steps might be taken to monitor what happens to those children, who should be in school but are not?
Baroness Smith of Malvern (Lab)
The noble Lord makes a very important point. We have already said, more broadly, that we intend to bring forward provisions in the children and well-being bill for a children’s register for those outside schools. However, in the changes that we announced last week to the safeguarding provisions in the early years foundation scheme, we are also intending, after consultation, to introduce a new provision that will ensure better follow-up of children who have been registered with nurseries and who then do not attend, in the way in which the noble Lord suggests.
Baroness Wyld (Con)
My Lords, I remind the House of my registered interest as a non-executive board member at Ofsted. The Minister will be aware that this landscape can be complex for parents to navigate. She talked about communications, but can she say a bit more about what the Government will do to ensure that all parents who have entitlement for their youngest children get the provision to which they are entitled? Might they be working with the family hubs and health visiting teams to have a strategic approach to communications on this?
Baroness Smith of Malvern (Lab)
The noble Baroness makes a very important point: that when there is a new entitlement, parents should understand what they are entitled to and be supported to find the places that support their children, which is why we will continue to publicise this. We will also, as she rightly says, find the other routes to ensuring that parents understand what their entitlements are. The next time that I am doing a media round on this, I will redouble my efforts so that I do not disappoint the noble Baronesses opposite.
Lord Goodman of Wycombe (Con)
My Lords, the most formative childcare for most children is of course provided by parents and families themselves. What plans do the Government have to make it easier for grandparents to care for their children and what plans they have, if any, to build on the transferable allowances introduced by the coalition Government?
Baroness Smith of Malvern (Lab)
The noble Lord is absolutely right that grandparents quite often play a very important role in supporting their children and grandchildren. I will take away his exhortations about support for grandparents and perhaps return to that matter directly with him when I have found out more about it.
Lord Young of Cookham (Con)
My Lords, further to the questions about the workforce, the point has been made that it is about more than just giving an adequate salary for those in childcare; it is about recognition. The Minister referred in her reply to status and staff development. What steps are being taken to develop a proper career structure so that this field of education can compete with the rest of the education field in having a well-defined career structure for people to aim at?
Baroness Smith of Malvern (Lab)
The noble Lord is right; it is of course about reward, but it is also about progression and recognition. We have worked hard already to try to reset our relationship with staff across the education system. Over the coming weeks and months, the Government will set out further plans for reform to ensure that the workforce feels supported and valued. We want a system that celebrates and supports early years carers and embeds it into our wider education system. Alongside the work I have already outlined on recruitment, recognition and status is something that we will want to return to in the early years strategy as we develop it.
Baroness Ramsey of Wall Heath (Lab)
My Lords, to what extent does my noble friend the Minister consider that this welcome expansion will further the Government’s mission to break down the barriers to opportunity?
Baroness Smith of Malvern (Lab)
My noble friend makes a very important point. As I suggested earlier, childcare provision is good for parents because it provides them with opportunities to work and supports them with the cost of living. Most importantly—my right honourable friend the Secretary of State is adamant about this—high-quality early years education provision ensures that children get the very best possible start. It helps to overcome disadvantage in their home lives; it helps to identify special educational needs earlier, and it sets children up to learn. That is why it will be an absolute commitment of this Government. We were pleased to be able to outline last week the next stage of our development in this area.
Baroness Butler-Sloss (CB)
My Lords, could the Minister of State say something about the importance of the status of people who work in early years?
Baroness Smith of Malvern (Lab)
Absolutely. The name of our recruitment campaign to encourage more people to come and work in this area is “Do Something Big”. Our argument is that there is little that you can do that is more important for changing somebody’s life than working with them in their very earliest years, whether through caring or through early years education and development. That is why the investment that this Government are putting in is so important and why we will celebrate the people who carry out that really important role.
Baroness Berridge (Con)
My Lords, is it not also the case with the staffing of early years that there may be a staff surplus in some parts of the country? One has seen the statistical collapse in the number of young children in the inner London area, yet places such as Oxfordshire have apparently double the number of children than childcare places. Is part of the strategy to enable people already in this sector to relocate?
Baroness Smith of Malvern (Lab)
The noble Baroness makes a very important point. I am not sure that it is for the Government forcibly to relocate staff in this area, but let me take that back to those working on the childcare strategy as we think about how to reform this as a place to work and ensure that it is a positive place to work. We seek to meet demand where it is needed, because not only are there shortages of staff in some areas but there are shortages of provision. We will certainly make sure that we are focusing support on those areas that most need both the staff and the provision.
Baroness Prosser (Lab)
My Lords, I am pleased to hear the Minister speak about the importance of the workforce. Will the Government bear in mind that it is important to include the employment of young men as nursery nurses as well as young women? Many years ago, my son was one of a very small handful of men who qualified under the old NNEB rules. Lots of the children in nursery at that time had very disjointed families and did not have a good male figure within their household. Sometimes the male nursery nurse was the only stable male person they came across. That may not be so much the case now, in terms of the sorts of children who will find their way into good nursery care, but it is important to bear in mind that men as well as women can be very good at this job.
Baroness Smith of Malvern (Lab)
My noble friend eloquently outlines the enormous difference that can be made to a child’s start in life by the security and development that they can get from any early years worker. She is absolutely right that this is a job that men do extremely well and should be encouraged into doing. For some children who have not had the benefit of having those sorts of role models in their family lives, they will probably be fundamentally important for their success later on in life.
Baroness Lister of Burtersett (Lab)
My Lords, one of the last Labour Government’s great achievements was the introduction of the Sure Start scheme, but, as my noble friend will know, many Sure Start centres have been closed. I am often asked what our Government’s position is on Sure Start. Could my noble friend perhaps say something about it?
Baroness Smith of Malvern (Lab)
One of the very last contributions that I made in the House of Commons before I came face to face with the electorate in Redditch was to suggest that I feared that a future Conservative Government might dismantle our Sure Start programme. I was jeered at the time, yet sadly I was right. In recent years we have seen, through some of the longitudinal analysis that was done on Sure Start, the impact that it had on children’s lives. I am afraid I cannot at this time undertake to reinstate the scale and significance of the last Labour Government’s Sure Start scheme, but I can say that recognising the way in which all those elements work in a child’s life—childcare, early years, health and family support—will be a very important way that, across this Government, we think about our future plans to support children to have the very best start in life.
Lord Brooke of Alverthorpe (Lab)
My Lords, the Minister mentioned the creation of a children’s register —yet another register that we are creating when we have already set up so many over the years. If she casts her mind back to the previous Labour Government, one of the major initiatives we had was to create an identity system for each person and child in the country. We increasingly see that that need still has to be addressed, particularly for problems with immigration, yet we now have a different approach by the new Labour Government. Although I recognise that this is rather wide of her brief, I wonder whether she would care to bear in mind that there is a case to be made for a simple approach to this. We ought to be trying to create coalitions where we work together to create a system that will give us greater data about everyone, including children, and which would be far more efficient than the present system, where we create separate systems all the time.
Baroness Smith of Malvern (Lab)
My noble friend tempts me to relive my days developing the national identity scheme and, in fact, having one of the very first identity cards issued by the last Labour Government. However, I will not go down that route. I have some sympathy with his point about around the range of different ways in which we now ask people to prove their identity. The intention behind the register for those children who are out of school is very much about safeguarding and ensuring that children do not get lost to our system, as has sadly become increasingly the case over recent years and which was exacerbated by Covid. This has a very special and important child safeguarding intention, which is why it is a legitimate scheme in its own right.
Passenger Railway Services (Public Ownership) Bill
Monday 21st October 2024
(2 months ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Act 2024 View all Passenger Railway Services (Public Ownership) Act 2024 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-I(a) Amendments for Committee (Supplementary to the Marshalled List) - (18 Oct 2024)
Lord Gascoigne
“Purpose: improvement of passenger railway services(1) The purpose of this Act is to improve the performance of passenger railway services in the United Kingdom.(2) The Secretary of State must, in taking any actions under the provisions of this Act, have regard to this purpose.”Member's explanatory statement
This amendment requires the Secretary of State to have regard to the purpose of improving passenger railway services when taking any actions under the terms of this Act.
Lord Gascoigne (Con)
My Lords, in moving my Amendment A1 I will speak also to Amendment 48A in this group. First, with permission, as it is the first time that I have addressed the new Minister in the House, I congratulate him on his promotion—I think it is a promotion—in joining the Government. I have had the absolute pleasure of working closely with him and knowing him personally since 2008. I saw at first hand his sterling work when he ran Transport for London, alongside the equally impressive Mayor of London, Boris Johnson—something on which I know the whole Committee will agree with me. There are few people in the land more knowledgeable, so it is the country’s gain in having the Minister help tackle our many transport issues.
I declare that I am a regular commuter, and have been for years, travelling in and out of London from home almost daily—not least today, when I had a 15-minute delay to a 25-minute journey. It is because of my time as a commuter, as well as my time in London City Hall, working alongside TfL and many others, and my time in Downing Street looking at rail reform, that I am speaking today.
I turn first to Amendment A1. I do not intend to rehash the universal view that something has to change when it comes to our rail services, and I shall park temporarily whether I believe that the Government’s plan in this Bill is the right one. For now, I will take them at their word and do them a favour by setting out at the outset what this Government believe that the Bill will achieve. It is worth reminding ourselves that the Labour manifesto said that the Government will
“put passengers at the heart of the service”.
In April, the then shadow Secretary of State, who is the current Secretary of State, said in Labour’s Plan to Fix Britain’s Railways that:
“Public ownership for our railways is about the practical need to deliver better services where they have failed”.
My amendment tries to encapsulate that in something concise, setting out that the overall aim of these reforms is improving service. It does not set out every promise that the Government have made in trying to deliver these reforms, such as saving tens of millions of pounds and having more affordable tickets and even better mobile connectivity—more power to your elbow on that one. Amendment A1 is simple, short and streamlined. The Bill would open with what its purpose is and what the goal is, so that, in effect, like Ronseal, the Bill does what it says on the tin.
Some have already quizzed me on whether this purpose clause is necessary in the light of the Bill’s tight scope and focus solely on the effect of nationalisation of passenger rail services. In answer to that, I draw the attention of the Committee to those clauses relating to the temporary extension of privately run franchises. In that part of the Bill, it is clear that the Secretary of State will have to make a judgment on whether it is practical for a service to be provided by a public sector operator. With the addition of the purpose clause and the connected duty, the Secretary of State will have to have due regard to the improvement of passenger services under the Bill when making these decisions.
Turning to my second amendment in this group, Amendment 48A, as I have already said, and as was well covered at Second Reading, no one can deny that the current system is not working. It is fraught with endless delays and cancellations, yet year on year we have fare increases, so my amendments today are not done to halt reform of the railways and certainly not done from an ideological position, even if it has been said that the Government are driving this policy for ideological reasons. For me, it is quite the contrary.
Lord Grocott (Lab)
My Lords, I will be brief. As the focus of this is on passenger travel and the noble Lord’s desire to put that at the centre of the objective of the Bill—which is a laudable objective shared, I am sure, by the Government—I cannot help pointing out that one of the major decisions by the last Government, which will of course affect the capacity of the railway network to deliver first-class passenger transport, was their in my view crazy decision to truncate the HS2 programme.
That programme was introduced by a Labour Government, supported by the coalition Government and by Conservative Governments over a period of about 15 years in total and at two strokes—first, getting rid of the Leeds link and, secondly, getting rid of the Manchester link—so much planning, expenditure and work was wasted. I am sure my noble friend the Minister will agree with a lot of this. It means that, among other things, the service to passengers, which is at the heart of the noble Lord’s amendment, is bound to be diminished from what it could have been. The network was there to provide passenger transport, freeing up space on the west coast mainline, which is close to, if not beyond, capacity, and helping freight as well, of course, which is a very important part of what the rail network delivers. It would have enabled that by freeing up the west coast mainline, the old mainline, if you like, built by the Victorians and still doing remarkable work, and improving the network overall.
So, when he winds up, I really would like the noble Lord to take the opportunity to apologise on behalf of the Government he served for making those nihilistic decisions to scrap that section of the railway. Ironically, in an attempt to justify the action they took, they claimed that somehow several billion pounds would be saved and one of the ways the “saved” money would be spent—I think the figure was £9 billion—would be on filling potholes. Now I am strongly in favour of filling potholes, but it will not help passenger services on the railway—which the building of the two northern legs of HS2 would have done. So, as welcome, in many ways, as his emphasis is—I do not know whether it is on behalf of the Opposition or not—on supporting and improving passenger services, that has a long way to go to make up for the damage it did by the cancellation of HS2 north.
Lord Grayling (Con)
My Lords, I rise along with the noble Lord, Lord Gascoigne, as someone who has worked closely with the new Minister. I congratulate him on his appointment. He knows more than almost anyone about our railway network—the problems, issues and challenges—and, while he may find himself on the other side of the political fence to me, he will be a great asset in trying to sort the challenges of our rail network.
He will know, very much more than anybody else, what the challenges are. He will also know, therefore, that sorting out our railways is not simply about changing the ownership structure. He knows full well, for example, that many of the issues that passengers have experienced in recent years have been laid at the foot of Network Rail—the company he chaired, although it was not his fault, of course—and rightly so. However, all of us involved bear the scars from the difficult times in 2018 with the timetable change. The noble Baroness, Lady Blake, knew well the challenges then, particularly in her role in the north. In the north, they were caused most immediately by Network Rail’s failure to deliver an electrification programme in the timetable that had been committed to, which had a dramatic knock-on effect on the rest of the railway.
Therefore, I am not clear, and it is why I have a lot of sympathy with the amendment from the noble Lord, Lord Gascoigne, why a move of ownership is going to deliver a transformation for the passenger. I hope that the Minister, with his experience, will be able to talk a bit about that as he responds to the debate. Fundamentally, on both sides of the House, we are all about improvement for the passenger, and simply transferring ownership from public to private and private to public does not solve the challenges. Ironically, I was reading at the weekend—and I am sure it is true—that the Government are looking at bringing the private sector in to run Euston station, at the same time it is planning to take the private sector out of the railway to run the trains that go into it.
So I would be grateful if the Minister could set out why he thinks this change will deliver improvement for passengers and why, therefore, the amendment being proposed by my noble friend is wrong.
Baroness Randerson (LD)
My Lords, I am in the slightly unusual position of speaking to Conservative amendments that have not been spoken to already. However, I am sure the noble Lord, Lord Moylan, will correct me if I interpret them wrongly.
The noble Lord, Lord Gascoigne, set out the failures of the current system. Prior to the laying of the noble Lord’s amendment, I had taken the theme of this group of Conservative amendments as displaying a welcome, if overdue, conversion on the road to Damascus. After more than a decade of increasing confusion on railway services, declining levels of passenger satisfaction and rocketing fare prices, the Conservatives are actually looking at improving public train services.
Amendment 2 touches upon something with which I definitely agree: the inevitable winding-down effect of a four to five-year transition period. As I said at Second Reading, there is bound to be an impact on staff morale and the inevitable likelihood is that the best staff will move to other industries when faced with an uncertain future. There will also, of course, be cost pressures. For example, there is bound to be a tendency to level up across very different terms and conditions from one employer to another within the train operating companies. Last week, I was speaking to some train operating companies, all of which recognised the problems that will be faced as the Government try to bring together and harmonise terms and conditions without exposing the taxpayer and the passenger to higher costs. Of course, the most obvious problem is how to deal with rest day working. I know the Minister is fully aware of the problems to which I am referring, so I will be interested in his response.
Amendment 26 refers to costs. At Second Reading, I asked questions about several issues, such as station ownership and operation, which were not really answered. I also asked about British Transport Police, which is encompassed in Amendment 40, put down by the Liberal Democrats. The Labour manifesto contained a supposedly cunning plan for low-cost nationalisation, but there are still bound to be significant costs for such obvious things as new livery and uniforms. We all look forward to an integrated fare structure; that, of course, will come with upfront costs.
Amendment 22 refers to the establishment of an independent public body to assess performance, while Amendment 21 refers to an annual report from the Secretary of State. I hope that the noble Lord, Lord Moylan, will explain exactly what he is aiming at in these amendments. One of them asks for the sort of close supervision by the Department for Transport that we have had since Covid, which clearly has not worked terribly well; the other refers to a more arms-length approach. Which of those approaches does the Conservative Party in this House believe will be better?
Liberal Democrats would establish a railway agency —a nationwide public body to act as a guiding mind for the railways, putting commuters first, implementing wholesale reform of the fares system and holding train companies to account. We do not believe that the renationalisation of passenger rail will automatically deliver cheaper fares or better services. From speaking to members of the public, we have concluded that they really do not care who runs the railways; they just want cheap, efficient and reliable services.
I do not doubt the Government’s good will or their wish to make this huge change, which we all want to happen. However, as a signal of their intent and an upfront signal to the public, I hope the Minister will speak with the Chancellor of the Exchequer to ensure that in next week’s Budget, we have a fare freeze and the public see from the start that there will be a difference under this Government.
Lord Berkeley (Lab)
My Lords, the amendments in this group are all designed to try to get some information from the Government about the effect of the changes in this Bill. Will it help the passenger—as well as, I hope, the rail freight customer—and will it help with the costs? Several noble Lords have referred to the issue of costs on the railway, which is very serious; I shall probably come back to that later.
Lord Lansley (Con)
My Lords, I will briefly ask the Minister a question for when he comes to respond.
I am very supportive of what my noble friend says in his Amendment A1—that we be clear about the purpose of this legislation—but the Minister will be aware that the Bill will substantially achieve that by amending the Railways Act 1993. Section 4 of that Act, as amended, sets out the general duties of the Secretary of State and the Office of Rail and Road. While they are listed in relation to the Office of Rail and Road, they are added as duties of the Secretary of State under Section 4(3)(a).
Section 4(1)(zb) says that it shall be the duty of the Office of Rail and Road—and, by extension, the Secretary of State—
“to promote improvements in railway service performance”.
Will the Minister confirm that nothing in this Bill would change the continuing duty of the Secretary of State to promote improvements in railway service performance?
Can the Minister also say that it will not change the duties of the Secretary of State and the Office of Rail and Road otherwise listed in that subsection, including
“to promote competition in the provision of railway services for the benefit of users of railway services”.
I am interested know precisely how the Minister and the Government propose to meet that general duty, which is not changed by this Bill.
Lord Snape (Lab)
My Lords, I am always fascinated when Members of the party opposite attack proposals from this side of the House on the grounds that they are ideological. What could be more ideological than the privatisation of the railway system back in 1994? In my view, Amendment A1, to which the noble Lord, Lord Gascoigne, spoke earlier, would create another bureaucracy—something the Conservative Party are normally against. No one would say, and I certainly would not, that a nationalised railway will be the answer to all our problems. Having worked in it, I know only too well it will not be. On the other hand, I think if you asked the average rail passenger for his or her view of the current system, they would say that anything would be better than what we have at the present time.
When it comes to ideology, I followed with interest the words of the noble Lord, Lord Grayling, who talked about failings in the increased cost of electrification leading to the delay, and in some cases the cancellation, of various electrification projects. My noble friend the Minister, who will respond, has great experience of Network Rail, and he might comment on some of the costings—many of us would take an interest in those matters. I was surprised, to say the least, at some of the expensive projects that Network Rail has embarked upon and the failure of that organisation to work within the original estimates, as far as costs are concerned. I hope it will not upset the noble Lord, Lord Grayling, too much, but his sojourn as Secretary of State for Transport is not looked upon by the railway community with any great favour. His view that in some cases electrification was unnecessary and that what was needed was bi-mode trains did not particularly please passengers. I recently moved home, from the Birmingham area to Gloucestershire, where I now have the pleasure—doubtful pleasure that it is—of travelling on Great Western’s bi-mode trains. They are often subject to cancellation and, again, the usual view from my fellow passengers is that the sooner the railway is renationalised, the better.
My noble friend Lord Berkeley is regarded as an expert on railway costings—he shakes his head, but he should not be so modest; he certainly played a major role with his views on HS2 and its finances. He mentioned the Office of Rail and Road. In the context of this amendment, can my noble friend the Minister tell me what role is envisaged for the ORR in future? I hope he will not be too offended if I say it is a misnomer: it is certainly an office for railways, given that it intervenes on various grounds—in my view, improperly, because there are proper roles for those responsible for railway safety in the industry—but appears to play no role at all as far as the road network is concerned. The fact that something approaching 2,000 people are killed on our roads on an annual basis is not something that detains the ORR. I hope my noble friend can tell me what role he envisages for the ORR in the newly nationalised railway system.
Finally, just to hark back to 1994 and the privatisation Act, fundamentally it adversely affected the railway industry. In 1994—again, I apologise for the history lesson—the railway system in Britain was regarded as the most efficient and effective in western Europe; certainly the subsidies paid to the rail industry in those days were less than those paid in countries such as France and Germany. The sectionalisation of the railway industry in the 1990s, largely at the behest of a Conservative Government—I do not make any complaints about that, as Governments have opinions—led to a much more readily identifiable system of costings for the industry overall. For the first time, we saw exactly which parts of the railway were profitable, which were not and which needed perhaps more money spent on them in the future than had previously been envisaged.
The relationship between Sir Bob Reid mark 1, the then chairman of the railways board, and Mr Nicholas Ridely, the Secretary of State at the time, was an extremely fruitful one. I am not here to announce any great fondness for Lord Ridley but I think that he appreciated what the railway industry was doing, largely at his behest at that time. I understand—although I do not wish to attribute words to him long after his death—that he was more than a little concerned about the mode of privatisation envisaged by the Government at the time, largely because of the success that he felt he had had in improving and defining the railway industry’s relationship with the Government of the day.
I hope that, when my noble friend the Minister responds to this amendment, he will appreciate at least that, whether the railways are privatised or public, all too often railway passengers—or customers, as they are somewhat laughably known these days—do not feel that their views on the provision of the service are listened to or that there is a proper voice for them. It is some years since the transport users’ consultative committees were abolished. Can my noble friend say what plans he has for better passenger consultation in the future?
In conclusion, I hope that my noble friend will not get too bogged down in the bureaucratic desires of the party opposite. Future amendments that we will come to, from the Conservative Party or its Front Bench, appear to believe that railway management has nothing better to do than put together various plans, which no doubt will be torn apart by those who feel that the railways are not delivering the service that they should. I await with interest my noble friend’s response to the amendment. I know that he will bear in mind that we ought to be concerned about the passengers of the future—the passengers of the past having been sadly neglected.
Lord Sterling of Plaistow (Con)
My Lords, trade moves by trains. Why do I bring that up? Some of your Lordships may remember that when Freightliner was put up for sale, P&O—the Peninsular and Oriental Steam Navigation Company, to give its full name—bid for it, and we were told by the competition authorities that, at that time, we already controlled 25% of transport movements for the whole of the UK and therefore we could not take it over.
I went to see the Secretary of State for Transport and everybody involved with this—our own people—to say that it was ridiculous. In practice, what we really wanted was to have a fast line for container trains, at night as well as in the day, from Glasgow right the way through to Istanbul, non-stop, for 2,500 miles, moving trade backwards and forwards in a major way. We had only about 3% of the trade in Europe, and I thought that, at that stage, it would have made a huge amount of sense. With those double trains going right the way through and the movement of trade, we would now be in a much finer position for doing trade in a much more major way, 2,500 miles away and further. I thank your Lordships for listening to me.
Lord Morgan (Lab)
My Lords, I would like to intervene because I frequently travel on the railways of France; my wife is French. The contrast between the railways in France—and, for that matter, in Italy—and those of this country is quite extraordinary. The railways were aptly referred to by my colleague on the Back Benches as a shambles and so they have been. It is therefore highly important that we have a properly integrated and effective service, which has been part of the tradition of infrastructure of this country for a very long time. I cite someone whose name will register on the other side of the House: Winston Churchill. He was, in his time, a strong supporter of the nationalisation of the railways, partly on efficiency and technical grounds, based on his experience in Lloyd George’s coalition Government of the First World War, and partly on grounds that, fortunately, we hear less about now—questions of labour and industrial relations; I think the railways were almost next to the miners in industrial conflict in that period. We suffer by comparison with our neighbouring country colleagues—and, I hope, shortly, allies—and therefore the social and economic rationale of this Bill is profoundly important.
Lord Moylan (Con)
My Lords, I start by apologising to the noble Baroness, Lady Randerson, if I caused any confusion; I will try to do better. I welcome the noble Lord, Lord Hendy, back to his place from his excursion, no doubt by rail, in foreign parts. We missed him at Second Reading, but we had an excellent substitute in the shape of the noble Baroness, Lady Blake of Leeds.
I will make a preliminary remark at this stage, which I intend to save me making it on future groups of amendments. It is that we are, essentially, at least as far as the amendments tabled by Members from the Conservative Party are concerned, seeking information from the Government in relation to this Bill. If the Government are candid with us and give us the information that we are looking for, we will have achieved our objective on behalf of the public, and that will be the end of the matter.
I turn to the debate that has taken place so far. The part that has sparked me most, which I felt I had to answer, were the remarks of the noble Lord, Lord Snape. First, I agree with him about what a degradation it is that passengers have become customers when, of course, they really ought to be passengers. But there is also the question of ideology, which I hope to take out of the debate that we will have in Committee today and on Wednesday.
Of course there is always an element of ideology when one talks about privatisation and nationalisation. The railways, which, I think, are 200 years old next year, have been nationalised for only about a quarter of their entire existence. We must not think that nationalisation is the natural condition of railways in this country. They flourished and grew and were developed in private hands; we should always remember that. The truth is that in 1945-46, the railways were nationalised largely because, after six years of war, they were bankrupt. There had been no investment in them during the whole of that period, and they had deteriorated. Nor was there any prospect of their making sufficient profit that private capital could have been recruited to make up that deficiency.
Whether the then Government believed in nationalisation as an ideological matter or not, if the railways were to continue running at all it was going to have to be in government hands. Parts of the system were privatised in the mid-1990s for equally practical reasons—we discussed some of them at Second Reading. One reason was to attempt to improve customer service through competition; one was to recruit private capital into the railways on a consistent basis, which the Government had never been able to provide during the whole of the time they owned the railways—not enough capital and never enough consistency because no budget went beyond 12 months—and another was to try, frankly, to break the grip of the rail unions on pay, so that the astonishing disparities that exist between, let us say, a train driver and bus driver, which are entirely due to the monopoly supply of labour by ASLEF, might be evened out.
What we discussed at Second Reading, I am perfectly happy to admit, is that on some of these fronts privatisation has been successful, and on others less so. If the Government, who have won a majority on the basis of promising to nationalise the train operating companies, wish to give the other side of it a kick and see if they can make it work on that basis, I do not personally object—at least not on ideological grounds. But the House is perfectly entitled to have its practical questions about how this will work addressed. That is what the amendments in this group and many that will come before the Committee later intend to address.
The Government claim that this is a very small Bill. On the other hand, when they talk to the public it is a huge Bill, “because we are nationalising the railways”. They are not really nationalising the railways, because to nationalise something you normally have to pay for it and this Bill is not something where they are paying out to shareholders. All they are doing is letting the franchises that exist expire and then tying their hands and preventing themselves from renewing them except in emergency circumstances. It is, as I would have said at Second Reading if I had had more time, less nationalisation and more like dismissing your chauffeur at the end of his contract and deciding to drive the car yourself. At least you knew the chauffeur had a driving licence and some experience and qualification in driving the car, but now we will have the Secretary of State—we were told at Second Reading that she prefers to be known as the passenger-in-chief—as, in effect, driver-in-chief as well. We will see how that works out.
It is a big thing when the Government talk to the public—it is nationalisation of the railways—but when they talk to noble Lords it is a very little thing. All the big things, we are told, will happen in the next Bill— the train further down the line, expected in roughly a year or 18 months. That is the Bill in which many of our questions should be addressed, we are told—we should not ask those questions now. I think we should ask many of those questions now, for two very good reasons. The first is that the Bill presents us with a measure regarded by the Government as preliminary to that very large Bill, so it has long-term consequences. The second—a point made by the noble Baroness, Lady Randerson—is that the Bill sets up a shadow structure that could persist in operation for four or five years or even longer because, first, it will take us a year or 18 months before we see the Bill that will make these great reforms; and, secondly, as anyone who has been involved in the railways or any other large organisation will know, implementing significant change as a result of that legislation is likely to take several further years. We will have to live with the shadow structures set up as a result of the Bill for many years, and their practical consequences deserve the most careful scrutiny.
Lord Moylan (Con)
I am not quite yet the Minister, but the way the Labour Party is going, who knows?
Lord Snape (Lab)
I asked for that one, I have to say. It is mistakes being made at both ends of the Corridor recently.
Arising from what the noble Lord has just said, can I ask him to clarify two points? First, on the delay in moving on to the more detailed Bill, bearing in mind that it was 2016 when the Government he favours brought forward the proposals for Great British Railways, what were the Government doing in the eight years since then? Secondly, I have a simple question about the ideology of privatisation: if nationalisation is so bad, why was almost the first act of Governments in two world wars to nationalise the railway industry? What makes it so essential in wartime and yet it can be handed out piecemeal in peacetime?
Lord Moylan (Con)
If the noble Lord will forgive me, I am asking the questions in this scenario, and I do not feel I necessarily have an answer to his question about wartime. I might pass it on to the Minister, who once arranged for me to go and see deep in the bowels of Mayfair, under the former Down Street Underground station—I am sure that if the noble Lord, Lord Snape, has not been, it can be arranged for him to see it too—the wartime headquarters of the railway operations executive, including what is claimed to be, although I think with no historical foundation, a tin bath in which Churchill once took a bath. I will say no more about the war than that.
On the former question, I do not know the answer, but I would like to know. Why was it that the then Government, having published what they called the Williams-Shapps review written by Keith Williams—I think he is correct in saying that it was in 2016—and having promised a transport Bill in the King’s Speech one but last, did not come forward with the measures they thought they could offer in that regard? I do not know the answer to that, but I am willing to have a guess and it is relevant to what the Government are embarking on now and to whether they are going to meet their 12 to 18-month deadline of delivering us with this massive Bill that is going to transform the railways. My guess is that the then Government found that grappling with the intense difficulties of reforming the railway on such a large scale meant that, try as they might, they found considerable difficulty in putting together that Bill. It may be that is exactly what the Minister finds as he comes to address these difficulties. This only adds further to my point that the shadow arrangements we are setting up today could be with us for a very long time.
I come to the first amendment in the name of my noble friend Lord Gascoigne. The Government say they have a purpose—they are not doing this for ideological reasons or at the behest of the trade unions—which is to improve passenger services. At Second Reading, I pointed out that in the final stage impact assessment produced by the Department for Transport, given the opportunity it had to say exactly that, it said something completely different. It said that the Bill had been
“prepared to enable swift delivery of a Government manifesto commitment”—
not to improve matters for passengers—and that was why it had not looked, as it normally would, at the alternative options that might be put forward to achieve a similar purpose. That is another reason why it is incumbent on us in this House to look in great detail at what the Government are putting before us. They are in effect asking us to buy into an article of faith. They are simply saying, “Well, it couldn’t be worse than it is at the moment”—that is simply untrue; there are problems with the railways, but they could be a great deal worse than they are at the moment—“so it is bound to be better if we take it over and run it ourselves as part of a national enterprise”. But they have not provided any evidence for that; they have simply stated, “This must be the case and you’ve got to believe us”. As I say, that is one of the reasons why our job is not to do so.
Lord Liddle (Lab)
Can I try to help the noble Lord? My understanding is that the Government are committed to a comprehensive package of rail reform, and that the Bill for the comprehensive package will be introduced next spring. The purpose of this Bill is a relatively minor reform, in my view, in the context of the much bigger reform, which is to make sure that the franchises can transition to public ownership at minimum cost to the Exchequer. If we are going to do it at minimum cost to the Exchequer, we have to do it quickly; that is why this is one of the earliest Bills that the Government have put forward.
Lord Moylan (Con)
The noble Lord puts the Government’s case very well. How much the House has lost in not seeing him on the Front Bench as the Minister, given that he was the shadow Minister up until the general election.
We are told by the noble Lord that the Government have a package of reforms. We all have a package of reforms. We know what the package of reforms looks like; it is in the Shapps-Williams review. Yet what we are seeing from the Government is a package of reforms that differs significantly from the Williams review; that is why it needs such careful scrutiny.
Given the passage of time, I will be brief on the remaining amendments. All the amendments in my name seek to test the effects of this measure on the performance of the industry in the light of the nationalisation that the Government are proposing.
Taken separately, the amendments deal with different types of performance. Some deal with the performance of the railways in so far as they engage with passengers; that is, on timeliness, efficiency, service quality and so forth. Some relate to the performance of the railways in relation to finances; we will come to finances in more detail later. The Government claim that this Bill has no financial consequences—there are those of us on this side of the House, including the noble Baroness, Lady Randerson, who treat that approach with great scepticism. Other amendments seek to examine the measure’s effect in relation to the performance of the network as a whole.
I hope that all these amendments will be accepted by the Government. If they are to make these changes, there needs to be transparency and the public need to be able to see metrics published, possibly by an independent body or possibly by the Department for Transport—we are open to persuasion on that—which show how the railway is performing.
Having come to power committed to transparency, I know the Government would not want to resile from that. So, if they are not able to support the detailed amendments as tabled, I expect that the Minister will have no difficulty in saying that the Government will put forward amendments on Report showing how this Bill will be monitored in its implementation.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
First, I thank the noble Lord, Lord Gascoigne, for his welcome; it is nice to see him again in different and more august circumstances—different, at least, from those that applied in the old City Hall. I thank him, and the noble Lord, Lord Moylan, for their explanations of this group of amendments, most of which require some form of reporting or assessment of the impacts of public ownership or the performance of publicly owned operators.
Like my noble friend Lord Snape, I am fascinated by the plethora of reports proposed at this stage of railway reform. Given that LNER has been in the public sector for six years, and Northern for four, it is strange that the measures now proposed for public sector train operators were never contemplated or enacted by the previous Government, who clearly never thought that they needed them. In simple terms, this Government do not either.
I welcome the support of the noble Lord, Lord Gascoigne, for railway reform. His Amendment A1 does not call for any reports but requires the Secretary of State to have regard to a specific purpose —to improve the performance of passenger services—when exercising functions under the Bill. I entirely support that purpose, and it is at the heart of what we are doing, but there are also many other purposes: stripping out inefficiency and waste on behalf of the taxpayers who fund the railway, simplifying fares and increasing patronage, connecting communities, driving economic growth and promoting opportunity for all. It is not right that the Bill should suggest that it has only that one purpose, important though it is.
Amendment 2, tabled by the noble Lord, Lord Moylan, would require the publication of two reports: the first outlining the anticipated impact of public ownership, and the second assessing its actual impact some years after the event. Regarding the first of these reports, the Government have already fulfilled the proposed obligation through the impact assessment published earlier in the year. Among other expected impacts, the taxpayer will no longer have to fund many tens of millions of pounds in fees currently payable to private sector operators each year, even when their performance is sub-standard. Furthermore, public sector operators will prioritise the interests of passengers and taxpayers, not the demands of their shareholders.
A similar report is envisaged in Amendment 48A, tabled by the noble Lord, Lord Gascoigne, but focused specifically on the impact on performance. I can assure the noble Lord that the Government certainly expect public ownership, and our broader reform proposals, to unlock the significant improvement in the performance and efficiency of the railway which he is looking for; we do not need to publish a report to say that.
Turning to the second proposed report envisaged in Amendment 2, there is no need to wait for three years before we start to consider whether train operators’ performance is improving. A wide variety of data is already routinely published about the performance of both public and private sector train operators. This includes reliability and punctuality, service quality, customer complaints, financial performance and efficiency, among other measures. This Bill does not change any of that, but as part of our wider reform plans, we will further improve access to data. This will be specific to individual routes and/or service groups, not just aggregated at the level of whole franchises, so that passengers can see at each station how services are performing on their local routes and, importantly, what is going to be done to improve them.
The Government can and will monitor performance closely on a continuing basis. We will hold operators’ feet to the fire when their performance is inadequate, irrespective of whether they are privately or publicly owned. The Secretary of State and I have already demonstrated that we will not accept the poor standards that have been tolerated in the past. We have demonstrated that from our first days in office by holding meetings with the managing directors of several train operators alongside their Network Rail counterparts to address poor performance and demand immediate action to raise standards.
In that respect, in answer to the noble Lord, Lord Grayling, we are not discriminating between the public and private sectors and will not do so, as indeed he did not in his time. He rightly gave me a hard time in 2018 in respect of electrification in the north-west of England; even if it was not Network Rail’s responsibility, it related to the failings of GTR as an operator.
Amendment 26, tabled by the noble Lord, Lord Moylan, would require the publication of a further report—or perhaps 10 reports, one after each transfer—setting out the expected impact of the transfers on various aspects of train operators’ performance. Again, once transfers have taken place, it would be more instructive to consider the actual performance of train operators.
Amendments 21 and 22, also tabled by the noble Lord, Lord Moylan, would require the reporting and independent assessment of the performance of publicly owned train operators. That is unnecessary because, as I have set out, the Government will themselves be monitoring their performance closely and will work to ensure that as much performance data as possible is published for the benefit of the travelling public, in a form that is useful to them and that allows for effective scrutiny.
My department is currently reviewing the standard terms of the service agreements that are entered into between the Secretary of State and public sector operators, in readiness for future transitions to public ownership. Public operators will be set targets in key areas such as punctuality and reliability and other aspects of the service. Work is under way to identify the right targets and measures for the period ahead in order to focus operators on delivering the best possible outcomes for passengers and taxpayers. As part of the service agreement review, we will consider the arrangements for publishing those targets and operators’ actual performance in comparison to them.
Amendment 22 refers to performance improvement plans. I reassure the noble Lord that improvement plans are already a feature of the Government’s service agreements with each public sector operator. I confirm for noble Lords that similar mechanisms will continue to exist in future, both through contractual terms and through the controls that DOHL exerts over its operators on behalf of the Secretary of State. As I have said, where performance is falling short, we will not hesitate to demand that things are put right, regardless of whether the operator is privately or publicly owned.
Amendment 45, tabled by the noble Lord, Lord Moylan, requires the publication of an independent assessment of the performance and efficiency of the rail network five years after the enactment of this Bill. By that time, the Government will have established Great British Railways, which will have taken over responsibility for both track and train. New arrangements will need to be put in place to oversee and scrutinise the effectiveness and efficiency of GBR, so in due course we will set out our plans for holding it to account as part of our plans for the wider railways Bill. We should not pre-empt those future arrangements by seeking to legislate for them now.
I hope we will deal with all the noble Lord’s other points during the rest of Committee, as we shall with the detailed comments of the noble Baroness, Lady Randerson, on staff morale and the British Transport Police. In answer to the noble Lord, Lord Lansley, I confirm that there are no changes to Section 4 of the 1993 Act.
In answer to my noble friend Lord Snape, in the present Bill there will be no change to the role of Office of Rail and Road; he needs to await the substantive railway Bill for that, at least with regard to the railway element of the ORR. There will be public consultation on the wider Bill before it comes, so there is no need to wait until the publication of the Bill itself.
I also say to the noble Lord, Lord Moylan, that there is currently no meaningful private investment by train operating companies, so we are not losing anything in the Bill that is on the table today. Contrary to his assertion about the Williams report, its author, Keith Williams, envisaged public ownership as a necessary condition to rationalise a number of things on the railways, in particular fares, ticketing and information.
Lord Moylan (Con)
My Lords, I am clutching my copy of the Williams rail review in my hands. I think I am going to refer to page 55 at another stage—my eyesight is not good enough to give the quote straightaway —when I will have the opportunity to point out that Williams’s approach to nationalising the train operating companies was somewhat more subtle and differentiated than the Minister has just claimed. But I want to ask him about a different point. It is a genuine curiosity I have about what might be described as the theology of Great British Railways and the new system that the Government are putting in place.
My understanding was that Great British Railways would be the single controlling brain operating the system and using a concession system to do that—let us say it is doing that itself now in the new system. It would be setting the goals of the railways through routes, service frequencies and so forth, and indeed running the fares and ticketing system. It would then be monitoring how these shadow or publicly owned companies were doing. We are now told by the Minister that all the monitoring functions he has referred to, which I would like to see set out transparently in advance through the Bill as being by independent bodies which we can trust, will be done by the Department for Transport. I ask him to be clear with us: in this system, who is responsible for monitoring and to whom is the system accountable? Is it to Great British Railways in its shadow form—now that it has been established and has a chairman, staff, a transition team and so forth—or is it the Department for Transport? The answer to that question has very significant consequences and it appears to be a moving target.
Lord Hendy of Richmond Hill (Lab)
I should respond to the noble Lord on three or four points. First, whatever the Williams report said—and it was adequate in what it said at the time—I took the trouble, only a few days ago, to confirm with its author that he acknowledged we could not change the fares, ticketing and information systems without taking the train operating companies or their activities into public ownership.
Secondly, the noble Lord knows perfectly well how a large public body can behave in monitoring activities, whether it carries them out itself or has contractors or concessionaires to do it, because he will be as familiar as I am with the experience of Transport for London. It monitored its own activities, published them and allowed others to scrutinise them. That principle is the one which should be adopted by Great British Railways.
Lord Moylan (Con)
So is it Great British Railways that will be doing it, like TfL, and not the Department for Transport? I am very confused.
Lord Hendy of Richmond Hill (Lab)
Well, the noble Lord should not be, because it is quite clear to me that the Government intend to take a large amount of activity out of the Department for Transport and put it in a body that is responsible for the performance of the railways. That being the case, it would be extremely logical that monitoring performance is done by GBR but properly scrutinised by others.
Lastly, I simply say to the noble Lord opposite that there has been a change of government. The policies that this Bill and the railways Bill will seek to enact are the policies that the Government were elected to carry out.
Lord Gascoigne (Con)
My Lords, I am grateful to everyone who spoke in what I thought was going to be a relatively brief debate, but I think we have clocked up over an hour and it has become far-reaching, showing the wealth of knowledge in your Lordships’ Committee.
I will cover some of the points that were raised. The noble Lord, Lord Grocott, raised HS2 and my own position. As a northerner, I have my own personal views, but I have to say that I was merely a Whip on the Government Front Bench and, as powerful as I may have been in controlling speaking times from the Dispatch Box, I did not have the power to control spending. It is something I will raise with the Opposition Chief Whip, my former boss, later. With respect, perhaps the noble Lord may want to speak to his own Front Bench about future spending plans. If I may say so, I think the Prime Minister’s own position on HS2 has been perhaps confused over the years.
Turning back to the debate, I think this group was about the future plans covered by this Bill. The noble Lord, Lord Snape, suggested that my Amendment A1 would create bureaucracy, and I think the Minister said that it would not; it is merely a purpose clause. I repeat what I said earlier: my only wish is to make it clear that services will improve.
I am grateful for the Minister’s response, but I would have thought that the Government could have at least supported Amendment A1 as it is a purpose clause. It could demonstrate that the Government do not believe that the Bill will improve services. Although the Minister said at the Dispatch Box that it would improve services, he then listed a number of other things it would do. I do not know if I should take that as meaning that the Government will accept my amendment but also list all the other points they believe it will do as a purpose clause. That said, obviously this will be an ongoing conversation and for now I beg leave to withdraw my amendment.
“25B Termination of existing franchise agreements(1) The Secretary of State must terminate franchise agreements for default in accordance with the terms of the agreement as soon as it is possible to do so.(2) Subject to subsection (1), the Secretary of State must not terminate a franchise agreement pursuant to a break clause unless—(a) there are no other franchise agreements which are—(i) terminable for default or may be terminable in the next three months for default, or(ii) will come to the end of their term within the next three months, and(b) the Secretary of State is satisfied that provision of the services by a public sector company will improve existing service provision.(3) In this section, “break clause” means a contractual provision in a franchise agreement which entitles the Secretary of State to terminate the franchise agreement before the end of the franchise term by notice without reason.”Member's explanatory statement
This amendment would require the Secretary of State to nationalise the worst performing operators first while enabling services that are currently working well to continue.
Baroness Scott of Needham Market (LD)
My Lords, I am sure that all of us want the same thing that the passengers want: a railway which is reliable, punctual and affordable. In too many parts of the country, they have been let down and this has not been delivered. Personally, I can understand why the Government have chosen this way of doing things and improving matters. But I do also think it is beholden on this House, particularly as we are now in Committee, to really focus on the way in which the Government intend to do this. It is in that spirit I move Amendment 1.
I am arguing what I argued in my Second Reading speech—that, in order to make the transition to public ownership a success, the Government should first take on those operators which are demonstrably failing passengers. They should turn those services around to deliver tangible improvements for the travelling public. It follows that the management of currently high-performing operators—as I shall show noble Lords, they do exist—should be retained for as long as possible to ensure that passengers continue to receive good service while minimising costs to taxpayers.
This amendment would require the Secretary of State to first nationalise the worst-performing operators to deliver immediate benefits to passengers and taxpayers, while enabling services that are currently working well to continue for the time being. Specifically, it places the Secretary of State under a duty to prioritise the termination of franchise agreements where the incumbent operator is in default of their agreements and gives them a duty not to terminate non-defaulting franchise agreements early unless there are no franchise agreements to be terminated due to default or because of their expiry. It would also require that terminating such an operator early would improve existing service provision.
I will say a word or two about the railway I use. I have travelled between Suffolk and London several times a week for more than 25 years now, and I can tell noble Lords that my service has never been better. Greater Anglia has spent £1.4 billion upgrading its rolling stock. It returned £65 million to the Treasury in the year ending in March and is predicted to return £100 million next year. It has a 94.8% public performance measure; I think Avanti is currently at 62.2%. Greater Anglia’s cancellations are at 1.4% and Avanti’s at 10.2%, but Greater Anglia’s full term expires in September 2026 and will therefore be one of the first to go.
It is genuinely difficult to see how that performance could be bettered. Indeed, with new management operating and a whole new set of structures it could conceivably get worse, initially at least. On the other hand, the poorly performing franchises have the potential for significant improvement—indeed, that is why the Government are doing this—so by using a strictly chronological approach they risk losing the confidence of the public right at the start of this process.
Current national rail contracts give the Secretary of State powers to act against failing train operators, both in general and where remedial measures are in place, and she has broad rights to information provision about possible contraventions, so could the Minister outline how the Secretary of State has used these rights in relation to CrossCountry and Avanti contracts? The grounds for default under the national rail conditions are passenger service performance, non-compliance with remedial agreements and contravention of other obligations, so has the Minister sought advice on CrossCountry’s and Avanti’s performance in relation to those provisions? Is either TOC in breach of any other provision? With Greater Anglia, West Midlands Trains and East Midlands Railway all performing well, can the Minister say whether they will be allowed to run their full course?
Regardless of where your Lordships stand on the question of renationalisation, in the end, as members of the travelling public, we all want it to work. By taking a strictly chronological approach, which leaves poor performers in place, the Government risk seriously undermining their own flagship policy. I beg to move.
Lord Liddle (Lab)
My Lords, I have an amendment in this group that is closely aligned with the noble Baroness’s, on which she has spoken very eloquently. It would reaffirm the Secretary of State’s powers to, if necessary, withdraw franchises from operators.
I tabled my amendment because I am a strong supporter of the Government’s policies and it would be tragic if we could not complete the transfer of companies to public ownership with remarkably quick speed. Yet, when we had the Second Reading debate, the noble Baroness, Lady Blake, pointed out to us that, unless there was a basis for withdrawing the Avanti franchise, it would run for another couple of years. It would be tragic if the worst-performing franchise, along with CrossCountry, was allowed to continue for this extended period and thereby to delay the Government’s ability to introduce the kind of rail reform that a unified railway under a guiding mind would make possible. To tell you the truth, on the basis of what I have heard, I think our Ministers are being a bit feeble. They could stand up to Avanti with much greater determination than they have.
Lord Grayling (Con)
My Lords, I shall raise a question with the Minister, as we are on the subject of the termination of franchises. I should say to the noble Baroness and the noble Lord that I have been there and wanted to terminate franchises. I have never had a problem with a mixed economy, but I have an issue with a uniform economy, because I cannot understand the logic of terminating a very good private sector provider, any more than the Mayor of London believes in terminating his private provider of the London overground—and I suspect, if we see more devolution in future, other parts of the country may want to see a mixed economy as well. Clearly, the Government are very happy to see that in stations, as we learned at the weekend.
However, it is more difficult than one might wish, and as a Minister you have to take a judgment about how much legal and therefore financial risk you are willing to take, and also about the disruption that the termination brings. Nobody should be under any illusion that making a transition between two operators has to be managed extremely carefully and, done at gunpoint, can actually lead to a deterioration of services.
I come to my question to the Minister. This set of amendments discusses the process of termination of franchises and when and how they happen—the order in which they happen. My memory is that, in a private system, at the end of a franchise, there is a payment to be made by the successor franchise operator to the franchise operator handing over control of that franchise. There are various capital costs and other costs incurred. If the public sector is coming in and saying, “Right, we’re taking over the franchise”, what can the Minister tell us about that equivalent process? Will payments be made to the companies that are being phased out, as there were between private operators? What will those payments be and what will be the total cost incurred by the Government in making those payments? After all, the private operators will have invested in capital aspects, on the stations or elsewhere. Therefore, logically, the Government will also have a legal obligation to go through the kind of process that happened in the past when a franchise simply moved between two private operators. Can the Minister address that specific point in his closing remarks?
Lord Snape (Lab)
My Lords, I honestly believe that the amendment so ably moved by the noble Baroness opposite is extremely sensible. Like her, I can see no reason why we have a chronological system for dispatching the current franchisees based on the run-out date of their particular franchise.
Like the noble Lord, Lord Grayling, I am in favour of a mixed economy. There are certain aspects of privatisation, heresy though it might sound to some of my colleagues, that were successful. The fact that some of the railway system—rail freight, for example, which rarely gets a mention in these debates—remains in the private sector is indicative of the success of those who took what was, under British Rail, a very much declining sector of the railway industry. I do not wish to do an “all our yesterdays” speech, but my recollection of the freight sector in those days is ancient wagons clanking around the system, being shunted from one marshalling yard to the next, and with an average journey speed between loading and destination of around 12 miles an hour. Since privatisation, the rail freight side has improved greatly.
To return to the very valid point made by the noble Baroness, Greater Anglia is not just a success so far as its operations are concerned; it is a financial success as well. Because of this unfortunate coincidence of the run-out date of franchises, Greater Anglia is forecast to repay to His Majesty’s Treasury around £100 million in the current financial year. As my noble friend Lord Liddle said, presumably—unless my noble friend the Minister can reassure us otherwise— we are going to dispatch Greater Anglia to the railway knacker’s yard while pursuing with Avanti Trains, as he and the noble Baroness said, a franchise operator that, quite frankly, should not be there.
The previous Government, in the run-up to the election, were stupid enough—or ideological enough, perhaps—to give Avanti an extra nine-year franchise, on the grounds that it was showing some improvement. Those of us who travelled on Avanti regularly—thankfully, it is an experience that is now behind me since I moved home—could not find any improvement whatever. Indeed, it seemed to me that the service was deteriorating on an annual basis.
Again, it might be heretical for some of my colleagues to hear this, but aspects of the passenger railway that were privatised were successful. At Second Reading, I mentioned Chiltern Railways. Thanks to the financial constraints that British Rail had to operate under as a nationalised industry, Marylebone station was proposed to be a coach station by Sir Alfred Sherman, if I remember rightly, Mrs Thatcher’s transport guru at the time. The existing railway management, again through no fault of their own but because of financial constraints, had to run the service from Marylebone down, single much of the line and reduce the overall train service. Under the able leadership of the late Adrian Shooter, and with a long-term franchise of 20 years, with various break-off points, my noble friend Lord Prescott and the then chief executive of the Strategic Rail Authority came up with this 20-year franchise, but insisted that not only had the service to be improved but some of the infrastructure had to be restored. Under Chiltern Railways, lines that had become single were redoubled, and a pretty poor commuter rail service now has two trains an hour as far as Birmingham—with a price, incidentally, as my noble friend Lord Liddle might be interested to know, which considerably undercuts the fare of Avanti trains.
There are aspects of the future of the railway industry where a mixed economy would make some sense. I hope that, in those circumstances, my noble friend the Minister will look with some degree of favour on the noble Baroness’s amendment.
Lord Berkeley (Lab)
My Lords, the noble Baroness makes some very good points. The Greater Anglia service is awfully good: my two noble friends who have spoken about it have confirmed that, and I have been on it recently myself. However, following the intervention of the noble Lord, Lord Grayling, could somebody from the Conservative Party—maybe the noble Lord, or one of his predecessors or successors—explain the basis on which it chose Avanti and CrossCountry, which are two of the worst performing operators, to be given such very long contracts? I remember at the time there was a big debate between Virgin and Avanti as to which should get the contract. Whatever one thinks about Virgin, it has had some good services in the past, but Avanti is absolutely awful—as is CrossCountry, though for different reasons. Why did the then Government do it?
It is fine to say that we have given it to a private sector operator, but if we end up in a situation where the Government are effectively going to make similar awards to people—not companies, but people—we should know on what basis it is done. I hope my noble friend the Minister can explain what the criteria will be to make sure that we get some decent new franchises and how he is going to get rid of the two existing pretty bad ones as soon as possible.
Baroness Randerson (LD)
My Lords, as a Great Western passenger, I wish I could speak as glowingly as my noble friend Lady Scott has done about Greater Anglia. GWR is known fondly to its passengers as “Great Western Roulette”. Will it or will it not turn up? How late will it be? Will it have five, eight, nine or 10 carriages? I can see people for whom that rings a bell.
The Liberal Democrat Amendment 1 turns on its head the Government’s proposed time-served system, which noble Lords have been discussing. In some ways, Amendment 48, in the name of the noble Lord, Lord Liddle, addresses the same issues. This is really about natural justice. Why should a poorly performing franchise be allowed to continue while an excellent one is terminated? Bear in mind that we are not bothered about the franchise owners; we are bothered about the passengers who have to suffer the service it provides. Why should passengers be denied reliable services?
There are two serious problems with the Government’s scheme. By chance, as has been said by several noble Lords, Greater Anglia, a profitable and very good operator, will have its contract terminated at the start of the process, while Avanti, whose performance is poor, will outlast almost all other train operators. That is topsy-turvy logic. The rail industry will lose the example set by Greater Anglia at a time when it, as a company, could be setting the new standards we all hope will be achieved by the new integrated public sector railway.
By imposing this rigorous approach to nationalisation at all costs, and nationalising even those train operators that are performing very well, the Government’s attitude is really inconsistent. They are not applying the same logic to roscos or freight services, or even to open-access operators. It is simply illogical to insist on the upheaval and dismantling of Greater Anglia, for instance, while regarding an open-access operator such as Grand Central as quite acceptable.
Lord Moylan (Con)
My Lords, I begin by speaking briefly to Amendment 30, standing in my name, which proposes the deletion of the word “reasonably” from Clause 2, line 29. At this point in the Bill, the prohibition on the Secretary of State from renewing franchises is alleviated by this clause in certain circumstances. One of them is where the Secretary of State is satisfied that it will not be reasonably practicable to provide or secure the provision of the franchise service, et cetera.
This is a simple probing amendment, on which I do not want to spend a great deal of time, other than to simply ask what the Government mean by the word “reasonably” here. What is “reasonably” adding to “practicable”? It seems that it is creating potential difficulties for the Government. On one hand, if they were challenged in court about this—I hasten to add that I am not a lawyer—I think they would find that one of the tests they would be put to is whether they had acted reasonably, and that would be true whether the word was in the statute or not. Here, it seems to me that there is a double standard of “reasonably” being applied to them. What do they mean by “reasonably”? In what circumstances do they envisage having recourse to it, and would the Bill not actually be better without it? I would be grateful for the Minister’s comments on those points.
On the substance of the debate, I congratulate the noble Baroness, Lady Scott of Needham Market, on having secured universal approbation for her proposal from all speakers who have spoken today. She wants something that appears to be very common-sensical: that the poor franchises should be terminated and cleared out as soon as possible and before the well-operating franchises are cleared out, so that we do not have a situation where good operators are removed from service while poor operators are left in place.
Yet, because of the rush with which the Government have come at the Bill, and because of their determination to be able to say, “We’ve achieved something in the manifesto as fast as we possibly can”, that is exactly the effect of the Bill as it is constructed. Operators that we know to be poor will continue for considerably longer than those that are in fact performing very satisfactorily. I suspect that the Government will say that this is because they have to terminate franchises at the time they fall due, because to terminate them any earlier would cost public money and they would need to pay compensation. As the noble Lord, Lord Liddle, said, that is of course the legal advice they would receive, though what exactly some of these poor performers would expect by way of compensation is a political question and one that could easily be put to the test, as the noble Lord said.
The other matter here is that the Government already envisage that some franchise contracts, despite the prohibition in the Bill, may be renewed for practical reasons, reasonably or otherwise. It is possible to renew a franchise on a short-term basis. In fact, nearly all the franchises currently operating are operating on very short-term contracts. The financial liability carried with those short-term contracts is very small. So, even if a good performer were to have their franchise fall in very soon, if an appropriate exemption to the prohibition were inserted in the Bill, they could still be kept going on a short-term contract without creating a significant new liability to the Government, while the poor contracts fell in and were terminated without any risk to the Government. If the Government were not in such a terrible rush, all of this would create a logical structure for the termination of contracts which passengers would understand and which would not run the risks that were stated so clearly by the noble Baroness who moved the amendment.
There is a great deal to be said for this. I hope the Minister, when he replies, will not take refuge in simply saying, “Oh, we’ve got no choice because this is what the public finances dictate and it is all driven by finances and contracts”. The management of these contracts—by a confident Government who know what they are doing and a Secretary of State who wants to achieve something and knows the direction in which she is heading—is essentially a political matter. It can be done and the Government should step up to the plate and do this for their own sake if they wish their reforms to get off to a good start.
Lord Hendy of Richmond Hill (Lab)
My Lords, I thank noble Lords for explaining their amendments in this group, which consider some of the practical aspects of the Government’s plans to transfer services to public ownership. Amendments 1 and 48 focus on the contractual arrangements that allow the Secretary of State to terminate a franchise early, following a breach of contract or other sustained poor performance. I make it absolutely clear that this Government will not hesitate to act decisively where an operator’s unacceptable performance means that the contractual conditions for early termination are met. The Secretary of State has made this plain on a number of occasions and I am happy to reiterate it to your Lordships today.
However, I am very much afraid that the terms of the contracts we have inherited from the previous Government do not make this easy. It is far easier for an operator to return the contract to the Government than it is for the Government to take back a contract for poor performance. It is deeply regrettable that in the past couple of years, some of the poorest performing operators have been awarded the longest contracts.
Noble Lords will not be surprised to know that we have looked very hard at the form of the contract. We are closely monitoring train operators’ compliance with their contract, but at present we are not in a position—with any operator—where the Secretary of State has a contractual right to terminate for poor performance. Noble Lords might be amazed to know that Avanti has not yet triggered the need for a remedial plan, although it may well do so. While CrossCountry has triggered the need for a remedial plan, we need to let that work through, together with the timetable reduction that the Secretary of State was deeply reluctant to agree to, before we discover whether its performance then merits some further contractual remedy.
Unless and until that contractual right arises, the only sensible approach is to transfer services to public ownership when the existing contracts expire. Any other approach would require taxpayers to foot the bill for compensation to operators in return for ending their contracts early, which the Government made clear in our manifesto that we would avoid, if only because of the state of the public finances we inherited.
I have also heard representations on behalf of operators—or, rather, their owners—that, rather than transferring services as contracts expire, we should leave their services in private hands for as long as possible. All the owning groups knew of these dates and would have planned financially for them in any event. The concern seems to be that service quality will suddenly collapse, or that current plans for service improvements, or for the rollout of new train fleets, will suddenly grind to a halt.
There is no basis for these claims. DOHL is experienced in transferring services into the public sector smoothly and without disruption, as it has proved in the difficult aftermath of past franchise failures. As services transfer, the same trains will be operated by the same staff as before, and no doubt often by the same management, as happened with LNER six years ago. The improvements that are already in train will continue. I have no reason to think that performance will deteriorate. Extending specific operators’ tenure will simply delay the process of bringing services back to public ownership, where they belong, and the financial savings that will result.
In answer to the noble Lord, Lord Grayling, while there have been transfer costs from franchise to franchise, he will of course recognise that the incoming franchisee would not pay that cost gratuitously; they would simply add it to the subsidy bill for the franchise they were inheriting. In the end, the public sector pays, as it has always done. In fact, since Covid, the operators have not funded anything at all, so the quantum in the future is likely to be extremely limited.
Lord Grayling (Con)
I would like some clarification from the Minister on that point. Has the department added up that liability? Does he have a total number for the transfer into the public sector of all the franchises?
Lord Hendy of Richmond Hill (Lab)
The answer to the noble Lord is: not yet. He will recognise that those costs materialise only when the franchise transfers, so the department will never have had that total number in the past, and I do not expect it to have it now. As the franchises transfer, the number will become obvious.
Lord Snape (Lab)
Before my noble friend leaves that point, I will ask him about the question of performance that has been raised on both sides of the House. The public performance measure national average is 88.7%, but the Avanti West Coast performance measure is only 62.2%—some 25% less. What has to be done to remove a franchisee which has performed so badly, as in the case of Avanti, other than knocking down the buffers at Euston and heading a Pendolino down Eversholt Street?
Lord Hendy of Richmond Hill (Lab)
In answer to my noble friend, and in recognition of some of what I have done in the past, it is sometimes a surprise when you read the performance requirements for contracts that you inherit. This is clearly one of those cases. I cannot defend the statistics that my noble friend cited, and I cannot defend a contract that allows that to happen without remedy.
In answer to the noble Baroness, Lady Randerson, we will come to devolution later in Committee.
Lord Moylan (Con)
I will not pursue the question of “reasonably” at this stage, but I was struck by the Minister saying that the Bill should not trammel the Secretary of State’s power in relation to how she manages contracts and franchises. However, that is exactly what the Bill does in Clause 2. What he wants is the liberty, within reason, of the Secretary of State to terminate franchises. But Clause 2 specifically sets out, in very clear language, a prohibition on the Secretary of State to award a contract to anything that is not a public sector company. It says that she may do so only
“by making a direct award of a public service contract to a public sector company”.
Admittedly, further down the page, there are, as we have discussed and as the Minister said, one or two very narrow exceptions for practicality, or reasonable practicality. But why do the Government feel that the Secretary of State should have complete liberty when it comes to terminating franchises, but is so untrustworthy and unreliable, so enamoured of the private sector and so easily seduced into re-awarding them the contract that there has to be a legal prohibition on her doing it here? All Members of the Committee are asking for is some flexibility in Clause 2 about what the Secretary of State is allowed to do—why not? Can she not be trusted?
Lord Hendy of Richmond Hill (Lab)
The answer is that it is the Government’s policy to take train operations into public ownership. The words the noble Lord mentions in Clause 2 just emphasise that intention.
Lord Liddle (Lab)
I would like to raise another point about Avanti. As I understand the law, the Secretary of State has a clear right to withdraw contracts on the basis of passenger service performance. Is it the case that the present Secretary of State cannot make her own judgment of that and is bound by whatever was decided before the last election? Would a court really not accept that the present Secretary of State has the right to make that judgment and act on it?
Lord Berkeley (Lab)
Before the Minister responds, perhaps I could add something to my noble friend’s comments on Avanti and performance. My noble friend Lord Snape mentioned, I think, a 60-something per cent public performance measure. What we do not know is the difference between delays caused by Avanti itself and Network Rail, the infrastructure manager. GBR will be in charge of the infrastructure as well as the trains, and it is pretty important that we know the balance between the causes of the delay, and how this will improve. Maybe my noble friend the Minister could write to us and give us a breakdown of the performances of the existing services and Network Rail. I believe, at the moment, that Network Rail is responsible for something like 70% of the delays, but maybe I am wrong. I look forward to his comments.
Lord Hendy of Richmond Hill (Lab)
On my noble friend Lord Liddle’s comment, I am sure the Secretary of State would like to make her own decision, but I am pretty confident that the work done in the department to assess whether Avanti is meeting its performance standards has taken into account what latitude there is. I suspect there is very little because of the contract terms.
I will write to my noble friend Lord Berkeley, and make the letter available, about the causes of delay on the west coast main line and to Avanti’s services. It is, of course, as he knows, undoubtedly true that every set of delays on the railway is due to a combination of the train operator and the infrastructure, and the way in which those parties manage their interaction with each other. When the Secretary of State and I have seen train companies about their performance, we have insisted that they are always accompanied by the relevant route directors of Network Rail. One of the issues is the root cause of the delays; another is how well those parties interact to resolve them. One of the issues on the west coast main line is that Network Rail’s control point, not unreasonably, is at Rugby where the signalling system is, Avanti’s control is in Birmingham and its train crews are managed from Preston. I would not run a railway like that myself.
Baroness Randerson (LD)
Going back to the contracts that are performing well, what is the Minister’s view on emergency situations, such as the recurrence of Covid and lockdowns? Would an existing contract, as currently written, enable an extension if the Government felt they needed it, or would they have to come to an end, so that we have to go through a fresh bidding process, come what may?
Lord Hendy of Richmond Hill (Lab)
It varies in accordance with the particular train company. Some of them are coming to a natural conclusion, others have break clauses that enable termination and, in a limited number of cases, there are some choices that could be made. To that extent, we will have to make them.
Baroness Scott of Needham Market (LD)
My Lords, I am very grateful for the support I have received from across the Committee for my amendment. I am not sure I can remember it happening to me before, and I was basking in the warm glow until the Minister stood up to reply. I am sure that all Members of the Committee will be disappointed because, at the bottom of this, we will be renationalising the Greater Anglia franchise with a performance rating in the 90 per cents, and leaving Avanti in place with its performance in the 60 per cents. Whatever the policy or legal niceties, people will be bewildered by that. I have every sympathy with the Minister; the Government inherited a contract that seems to have allowed extraordinary latitude to Avanti for poor performance. I also recognise the twin problem that it has an extraordinarily long franchise, but I am sure that he has heard very clearly what everyone is saying here. The message to him is: please be absolutely sure that there is not some extent to which political will can find a way through this. A failure to deal with this will leave the travelling public absolutely bewildered. With that, I beg leave to withdraw the amendment.
Lord Lansley
Lord Lansley (Con)
My Lords, I rise to move Amendment 3 and speak to Amendment 5 and a number of others in the group. We may find this naturally flows from the discussion we listened carefully to on the previous group. Some of the themes might well re-emerge, not least the question of the desirability or otherwise of a mixed economy in the provision of rail services.
We have just approved, for these purposes, Clause 1. Under Clause 1, we have agreed that
“section 23 (passenger services to be subject to franchise agreements)”
is to cease and that, in future, securing the provision of services will be the responsibility of the Secretary of State under the new Section 30. Clause 2 revises Section 30 for these purposes. At the moment, it is a section about the duty and the absence of franchise agreements, but it would become, under Clause 2, the public sector provision of services.
The other thing that is probably important to note is that under Clause 1 we have deleted the existing Section 25, so that there is now no longer a prohibition on public sector operators—all of which is naturally part of the process of implementing a policy, which, as the Minister has told us, is the narrow objective of the legislation.
Why have I thought it appropriate to bring forward these amendments? They are probing amendments to try to examine whether the Bill, even from the Government’s own point of view, is future-proofed against the circumstances that may arise and the objectives that they may seek to achieve.
Lord Young of Cookham (Con)
My Lords, I will add a footnote to the excellent speech from my noble friend Lord Lansley and note in passing that the Passenger Railway Services (Public Ownership) Bill is running late, with the likelihood of hitting the target of getting to Amendment 11 at a reasonable hour becoming vanishingly small.
This group of amendments is to some extent the obverse of the group that we have just had. The focus of the previous group was on ending prematurely, before the Government would wish, services that were not running satisfactorily, whereas the thrust of this group is to enable the Government to extend beyond the date that they prefer a contract that is running satisfactorily.
In a sense, this is all about ideology. There are two potential views. One was expressed by the noble Lord, Lord Whitty, who on Second Reading said:
“I have an ideological commitment to a nationalised railway system”.—[Official Report, 7/10/24; col. 1883.]
By contrast, in that same debate, his noble friend Lord Liddle—who, as we have heard, was formerly the opposition transport spokesman in your Lordships’ House, said:
“I do not see any ideological objection to public/private partnerships in running the railway”.
He then gave an example:
“You might have a situation where a private company was prepared to commit to electrification plans for a particular line that would not be in the public sector investment plan. My view is that we should allow public/private partnerships on a net additionality rule. If they are going to bring more investment into the rail system, what on earth is the case for not allowing them to do so?”. —[Official Report, 7/10/24; col. 1840.]
Again, in the debate today, the noble Lord, Lord Snape, said he was in favour of a mixed economy. I agree with that approach. If this amendment is opposed, it is because the Government have taken Lord Whitty’s view and they have an ideological commitment to nationalisation—which I thought had been abandoned some 30 years ago under Tony Blair’s leadership.
There has been an argument for flexibility. I want to develop the argument that the noble Lord, Lord Snape, developed about Chiltern Railways and Marylebone station. In the 1980s, Marylebone station was almost moribund. There were a few services to the commuter villages of Aylesbury, Amersham and Chesham, but, in the decade before privatisation, there were proposals from British Rail to close Marylebone. There were also alternative plans to turn the railway into a road. That was before privatisation. Three years after privatisation, 18 miles of single track between Princes Risborough and Bicester North had been doubled. In 2000, the brand new £4.2 million Warwick Parkway station was opened, and, by the end of the first franchise, advance plans were made to double the single-track section between Bicester North and Aynho, at a cost of £53 million. Marylebone station was then extended by adding a further two platforms, and there was an increase in line speed to Beaconsfield. In 2011, Chiltern took over the operating services on the Oxford-Bicester line from First Great Western and opened two new stations, Oxford Parkway and Bicester Village, providing services between north Oxford and Marylebone.
How confident is the Minister that all that would have happened if the line had remained with British Rail, which, 20 years earlier, was planning to close the station? Chiltern could do this because it had a 20-year franchise, which created the incentives for significant investment in rolling stock, major infrastructure and, as a result, timetable enhancements. It delivered its project on time and on budget, and self-financed nearly all the projects that I have just mentioned.
When pressed on why they were doing this, the Minister relied on, “It is in the manifesto”. Well, I hope they can provide a better argument than simply saying that. To use the expression used by the noble Lord, Lord Snape, Chiltern is to be sent prematurely to the “knacker’s yard”. Our debate takes place against a background of a Budget in a few days’ time, with enormous pressure on public expenditure. What the Government are planning to do—we will reach this in a later group of amendments—is bring on to their balance sheet all the private sector investment that has previously been borne by the private sector. Freight was mentioned, and the fact that they want to leave freight and open access operations in private hands perhaps indicates some inconsistency in their view that the private sector cannot deliver good services.
I will briefly mention two other reasons for these amendments. There is a question of the capacity of members of the Minister’s own department to manage all the new franchises that are going to come in. At the moment, they run four rail franchises; they have just two full-time staff and they rely on private consultants to manage these four franchises on a day-to-day basis. They are planning to absorb the remaining 10 franchises, which are now in private hands. They will have to grow significantly their own capacity to manage those departments and, as I understand it, they are in the process of growing their headcount from 21 to 90 by the end of the calendar year; all this at a time when there is pressure on departments to reduce their headcount. All these new people, all the external consultants, will need time to get up to speed with their new roles and build the necessary relationships to be effective, and I think that is a major constraint on their plans.
There is one other reason, which may be a simply technical one. It is possible that the Government may wish to extend an incumbent operator’s franchise, for example due to the lack of internal capacity that I have just referred to; but it may also be that the operator may not be willing to agree to a contract extension. As I understand it, with the Bill as currently written, the Government would not be allowed to appoint an alternative operator on a temporary basis—again representing a significant risk.
So these amendments indicate the need for flexibility, to allow the Government to retain high-performing private sector operators and to continue to give passengers an excellent service while minimising costs for taxpayers. I hope that, when the Minister replies, he will not say, “This is in the manifesto”, but will give some cogent reasons for ending the arrangement that provides, in the cases of Chiltern and Greater Anglia, the two lines that we have heard about, a high-quality service, possibly higher than the public sector would be able to provide.
Lord Berkeley (Lab)
My Lords, I will follow on from the interesting contributions from the noble Lords, Lord Lansley and Lord Young. I understood that Ministers had accepted that open access operators will be able to continue, or new ones may be able to come. So I have two questions. As the noble Baroness, Lady Scott, said in her introduction to her amendment, Greater Anglia is contributing quite a lot of money each year to the Treasury. Presumably it could ask to convert that service into an open access service and keep the money, and that would presumably be all right and the Treasury would lose out. I would be interested to hear my noble friend’s view on that.
If there is a new service, as one of the noble Lords said, that an operator of some description thought would be a useful one to introduce but which the new GBR thought was not appropriate, presumably there would be no reason why the new operator could not submit an application for open access, as happens at the moment. It does not have to be a long distance one from London to Blackpool; it could be a short distance one. How would that be seen by the Government. Would they welcome it?
Baroness Randerson (LD)
My Lords, this has been a very interesting group of amendments to debate so far, and I am very taken by the latest thoughts from the noble Lord, Lord Berkeley, on playing around with the definition of open access operators and what will be accepted. I was interested, too, in Amendments 28 and 29 and the thoughts of the noble Lord, Lord Young, who is always very thought-provoking. His amendment, as he said, is very much the obverse of the ones put down from these Benches. I urge the Government to look at this and allow themselves the flexibility to change the order of nationalisation in order to allow good franchises to flourish and to give themselves time to unravel privatisation more slowly and more logically. It has to be more than just, “This was in the manifesto and therefore it will happen whether or not it is logical”.
I am really sorry that the noble Lord, Lord Liddle, is not in his place, because Amendment 35 is fascinating. It refers to a broader definition of what a public sector company should be, so that it includes public/private partnerships and co-operative ventures. I do not need to remind noble Lords opposite that some of them have been, or may still be, members of the Co-operative Party. As Liberal Democrats, we share an enthusiasm for co-operatives as a form of company and operation. I can envisage that a smaller rail line, perhaps in a rural area, would work very well on a co-operative or a public/private partnership basis. After all, it would bring in fresh investment without, in any way, undermining the Government’s commitment to a nationalised structure overall for the railways.
Finally, I urge the Government to look again at their plans and the precise terms of the Bill through a post-Covid lens. Covid caused the collapse of the railway system, necessitating a whole new approach to franchising for the train operators. It could happen again, either for similar reasons or as a result of a financial crisis, and I urge the Government to look again at the terms of the Bill. Have they allowed themselves sufficient flexibility to cope with the unexpected, to allow rail services to continue to operate even if there is a series of unlikely events that have upset the market for those services?
Lord Moylan (Con)
My Lords, my noble friend Lord Young of Cookham said that he thought that the Government’s determination to trammel itself in the way that Clause 2 does was ideologically driven—a commitment to a certain vision of the railways based essentially on a political ideology. I would not be so bold as to disagree—he may well be right—but there is another way of looking at this, which I referred to at Second Reading. What is really driving the Government’s approach to this is that they have absolutely convinced themselves that the only way in which the railways can operate is if there is a single controlling brain, so that every train run in this country for passenger service purposes is run by Great British Railways, and that this body will be the sole provider of railway services.
This is a truly ideological obsession. It is almost a psychological fixation that appears to have gripped the Government, and it needs to be tested. Questions are being asked from every side of the House about its practical effects, and we are getting no answer except, “It’s in the manifesto”, which really is no answer to a passenger standing on a platform waiting for a train that was operating perfectly satisfactorily under private ownership and is now simply not arriving.
I turn first to Amendments 4, 10, 14 and 15 in this group standing in my name. If I had written the explanatory statements rather better, Members would understand—perhaps they do—that these four operate as one. They are consequential on each other and have a single effect, which is to say that the Secretary of State in awarding new services must put them out to tender but on a “concession” basis. Amendment 14 defines a “concession” as
“a contract under which the franchising authority specifies rail services to be provided by a private sector entity and retains the risk of fluctuations in the receipt of fares”.
In other words, this amendment does something that Transport for London has done with great success in relation to buses, London Overground rail services, the Wimbledon tram and the Docklands Light Railway. They are all operated on this basis and although there might be complaints from customers about this, that or the other, there are no complaints about the basis on which the services are operated contractually. Of course, TfL has chosen to brand them all under its own branding, so members of the public and passengers are often not even aware that they are operated on this basis. We have a system that works and that we should consider very seriously by contrast to the determination of the Government that all these services are to be taken in-house and run by a single employer with a great, single, controlling brain.
Amendment 14 does something else: it is in conformity with the Williams review, which I thought was the plan that there was, generally speaking, consensus that we should operate to. There is no other plan or document of any weight or substance that has been produced as a result of an independent review for the future of the railways. When I drew attention in our last debate to what is said on page 55 of the Williams review about the concession model being the pattern taken from TfL that should be used nationally, there was a slightly astonishing intervention from the Minister in which he said that Mr Williams no longer thought that, because he had rung him up and said that we need to have it nationalised. How much else in the Williams review has been vitiated by random phone calls made by the Minister to its author? How much is left of the Williams review, if it is capable of being rewritten by the Minister on the basis of claimed phone calls with Mr Williams?
It happens that Mr Williams and I served together on the board of Transport for London when the Minister was its commissioner. I have to tell him that if I were to look into the contacts in my telephone I think I would find that Mr Williams’s telephone number was in my telephone as well. It is perfectly possible that we could pursue this debate on the basis of various individual and private phone calls that we had had with Mr Williams about what he actually meant, what he thinks now, and whether his view has changed —and then what will be left of this report? Without this report, there is no plan. The Government are, it turns out, now inviting us to take a step completely into the dark. It is not just an act of faith, as I said on an earlier group, that they can run the trains better. It is a belief that they are going to give us a better plan for the future, but that they cannot tell us what the plan is, whereas at least previously they had some basis for saying what it would be. The whole thing really is turning into the most dreadful shambles.
I would like to know why concessions do not work, why something so successful in London will not be allowed, and why what was recommended by Williams is not allowed. I do not, I am sad to say, expect to hear the detailed explanation from the Minister that those questions deserve. The other amendments in this group have similar effect.
My noble friend Lord Lansley would like the Government to have the power, where they choose to, to go out to tender and allow some of these wicked private entities to submit tenders. I may myself be wicked when I say that many of these private entities are not very private—some are the subsidiaries of our great European railway friends. They are state-owned bodies from Europe. Who knows whether the Prime Minister, as he creeps towards a great reset and love-in with the European Union, would not find it quite useful to be able to say that the Italian railways, Deutsche Bahn and Renfe could bid for services running on our railways—just as they can at the moment—and that they are not going to be kicked out of Britain? “Mrs von der Leyen, we are going to let them back in.” Would not that little bit of flexibility that my noble friend Lord Lansley would like to be able to give to the Government possibly be rather welcome in the future?
My noble friend Lord Young of Cookham made a good case for his amendments. I echo the comments of the noble Baroness, Lady Randerson, who said that it is a great pity that the noble Lord, Lord Liddle, is not here to speak to his very intriguing amendment. To a large extent, the argument for it was made very well by my noble friend Lord Young of Cookham.
The possibilities of collaboration with the private sector—indeed, with community groups and, when we come to later amendments relating to devolution, local authorities and local government—are all worth exploring if we are going to reform our railway. All of these are being shut off and closed down now by the word “only”, which the noble Lord, Lord Lansley, and others are effectively suggesting be deleted.
Lord Hendy of Richmond Hill (Lab)
The next time I see our mutual friend Keith Williams I shall tell him that the noble Lord, Lord Moylan, said he was ghostly.
I thank noble Lords for explaining their amendments in this group, which consider, as we have heard, various alternatives to public ownership. Amendments 3 and 5, tabled by the noble Lord, Lord Lansley, would allow contracts to be awarded to private operators following a competitive process. Amendments 28 and 29, from the noble Lords, Lord Young of Cookham and Lord Moylan, would allow franchises to be continued where the current operator is providing a satisfactory service. I do not support these amendments.
The Government were elected on a manifesto commitment to return passenger services into public ownership—having published, for the avoidance of doubt, the detailed plan entitled Getting Britain Moving—and we have a clear democratic mandate to do so. Despite what has been heard this afternoon, public ownership is a change with clear public support. Last month, YouGov published a survey showing that 66% of people nationally agree that railway companies should be run in the public sector; only 12% favoured private operation.
We are determined to return to a passenger railway which is run for the public, by the public, with passengers, not private shareholders, at the heart of the system. We will not leave the back door open to franchising, a model which has failed passengers and taxpayers. We are committed to public ownership because continuing with franchising would mean continuing to pay fees to private operators, ultimately for the benefit of their shareholders, when that money could be retained for the public good. Franchising would not allow us to integrate track and train in the way we propose to do under Great British Railways, which is the only way to put a stop to the fragmentation and waste of the franchising system, otherwise we will not be able to sweep away the outdated, complex and costly mechanisms that make the fares system impossible to understand for passengers, and even now prevent rational change because of “commercial confidentiality”, even though all the revenue risk is now taken by government. There is no benefit to continuing franchised operations on our railways.
Contrary to views expressed by noble Lords previously, there is no meaningful private sector investment being funded by franchised operators at present, so we are losing nothing by moving to a public ownership model. The Government are already reimbursing the legitimate operating costs of private sector operators and receiving all their revenue. Even before Covid, the main private investment in our railways was in rolling stock, which was generally funded by the rolling stock market and not by train operators or their owning groups.
I turn to Amendments 4, 14 and 15, tabled by the noble Lord, Lord Moylan. These amendments require competitive awards to be made to private sector companies on the basis of a concession model, along the lines of Transport for London’s approach, rather than bringing them into public ownership. These amendments would remove the opportunity to deliver the benefits of public ownership, which, as I have said, a clear majority of the public support and which was a specific commitment in the manifesto on which this Government were elected.
The Government’s first objection is that a concession model would mean the private sector continuing to earn substantial profits. Public ownership will put a stop to the flow of money that already sees in excess of £100 million paid out in fees to the private sector each year, even when operators are bearing no significant financial risk.
A TfL-style concession model would expose operators to more financial risk than the current national rail contracts, which means that operators would want to earn significantly more in profits at the taxpayers’ expense and would price their bids accordingly. Not only would concessions be more expensive than this Government’s plans for public ownership but they would be even more costly to taxpayers than the current contracts.
In addition, the TfL concession model involves a very closely defined and largely unchangeable service specification developed in detail by the public authority, with therefore little room for the operator to negotiate changes post tender award in circumstances where they would always have the upper hand on pricing. Our national railway system is much larger, flows alter over time, and one of the great benefits of GBR is that it will be able far more easily to adapt to changing and growing markets and to save costs without endless contract renegotiation with contractors which, except at the point of contract award, always have the upper hand.
The noble Lord, Lord Moylan, referred to the TfL experience of contracting the London bus market. In two previous jobs I was responsible for that market for virtually 15 years. It is a different market because there are a large number of small contracts changing hands, so if a contractor is sufficiently unwise to suggest expensive changes when contracts need to be altered then there is the opportunity to at least counter that by the next award of contracts for other bus routes. That has not been the case in the railway market. It is never likely to be the case. It is a different circumstance.
As a practical point, this amendment would abolish the option for the Secretary of State to appoint a public sector company to run services once a franchise agreement comes to an end. What does the noble Lord envisage would happen under this amendment if an operator went bust at short notice, or lost its licence to operate or its safety certificate? What if a competition failed to deliver a satisfactory outcome? Passengers could not wait a couple of years while the Government run a competition for a new concession. I would also ask whether it is the noble Lord’s intention to tie the hands of the Scottish and Welsh Governments, as this amendment would do, and whether they support these amendments. I think he knows that they certainly would not.
Amendment 10, as the noble Lord, Lord Moylan, said, was to facilitate Amendments 4, 14 and 15, so I will pass over it.
Amendment 35, tabled by my noble friend Lord Liddle, would allow the Secretary of State, and Scottish and Welsh Ministers to award contracts to either a public/private partnership or a co-operative venture involving staff and passengers. The Government’s approach to this is driven by pragmatism, not ideology, and we are certainly not seeking to close the door on private investment, as I will explain later in Committee when we come to discuss rolling stock.
However, I point out that examples of private investment in our railway infrastructure have been fairly thin on the ground in the privatisation era. Nearly all the enhancements to the network have been publicly funded. The noble Lord, Lord Young, referred to electrification, but, as far as I can tell, there has been no electrification ever funded by any party except the Government.
The Government are certainly open to hearing proposals for how private investment might be brought to bear to improve the railway in the future. If noble Lords and others have good ideas, I encourage them to bring them forward as we develop and engage on our plans and consult in due course for Great British Railways and the wider railway reforms.
However, I do not think that involving private finance means that our plans for public ownership of train operations should change. It is fundamental to the Government’s plans for the railway that services should be run by the public, for the public. There are other ways of engaging private capital, short of ownership, and for the most part, even 100% private sector ownership of train operating companies under franchising has not resulted in large investments being funded by those companies.
As for co-operative ventures, I am all in favour of giving passengers and communities a stronger say in the decisions that affect them, but the likelihood of any co-operative venture raising any significant amount of capital—let alone the current circumstances of the owning groups of the present train operators—is, frankly, very small. Our plans are designed to give passengers and communities a stronger say in the decisions that affect them, not least by establishing a new passenger standards authority and by providing a new statutory role for devolved and mayoral combined authorities. We will get to the question of devolution in due course. The Government have shown, through our approach to resolving long-running disputes left to us to resolve by the previous Government, that we are committed to working with the workforce to address the challenges facing our railways.
The noble Lord, Lord Lansley, raised a question about future flexibility. The last legislation for the railways has lasted 31 years, and I note that it had a specific prohibition of public operation of the railways system. That might have been reasonable then but it is certainly reasonable now in the present circumstances, given our policies and manifesto commitment, to replicate our belief that public ownership is the right way of going forward with passenger railway operation.
In conclusion, the Government’s plans for the railways are founded on consolidating responsibility for track and train operations within a single entity, Great British Railways, particularly at a route and operating company level. Already, in my short period in this post, as I have said previously, we have had performance meetings with an operator and a Network Rail route. In one meeting, I enjoyed considerably one manager telling me how great collaboration was between the two parties, which were not owned by the same organisation, while the other simultaneously sat there shaking her head vigorously, demonstrating an absence of the very co-operation that I was being told would happen.
My whole professional history tells me that the railway will run better with somebody in charge of both track and train together at a route and operating company level. That is the way that we will deliver better revenue, decreased costs and, particularly, better reliability. This is not consistent with seeking to preserve private sector operation, whether through franchises or concessions, or with awarding contracts to public/private partnerships or arm’s-length co-operative ventures. I am amused to see that Rail Partners has reversed its previous opposition to the concession model post the election, having spent several years previously explaining why it would not work on the national railway network. I rather agree with its previous analysis. I therefore urge noble Lords to withdraw and not press their amendments.
Lord Lansley (Con)
My Lords, I am most grateful to all noble Lords who have participated in this not terrifically long but interesting debate—not least my noble friend Lord Young of Cookham, who admirably demonstrated the potential benefits of a mixed economy in the provision of rail services and referred to reasons why the Government might in the future need the flexibility that these amendments would offer.
I go back as far as the mid-1980s, when I was a civil servant participating in a spending round not dissimilar to the present one in a Star Chamber, where different nationalised industries had their capital programmes traded off against each other. I have to say that cost-benefit analysis was not a significant part of that discussion; it was mostly a discussion of the political benefits or otherwise. I fear the same will be true in the future and that some investment projects that should be funded will not be. It will be a great pity if that turns out to be the case for rail services in future.
I do not have the benefit of knowing Mr Keith Williams personally. I am tempted, as a former Leader of the House of Commons, to say that we instituted evidence sessions in committee. I wonder whether we could take an evidence session before a committee in this House as well; perhaps we will think about that for the future.
I thank the Minister for at least laying it all out pretty straightforwardly. He may come to regret saying that, essentially, as the 1993 Act was an ideological determination that there should not be public sector operators on the railways, we must now have legislation that says there must be only public sector operators on the railways. I am with the many of those who take another view—not least the noble Lord, Lord Berkeley, whose point on open access was about giving the private sector the opportunity under limited circumstances.
Lord Berkeley
“(1AA) Before making a direct award of a public service contract to a public sector company under subsection (1A), the relevant franchising authority must publish a report on—(a) the possible impact on rail network capacity used by rail freight services,(b) the possible impact on the meeting of the rail freight growth target for at least 75% growth in freight carried by rail by 2050 on 2019 levels.”
Lord Berkeley (Lab)
My Lords, in moving Amendment 6 in my name and that of the noble Lord, Lord Moylan, I will speak to two other amendments in this group, including Amendment 41, to which the noble Lord, Lord Bradshaw, has added his name. It is so good to see him in his place again as one of our real rail experts in this House, and I look forward to his remarks.
This amendment is about rail freight, largely. As noble Lords may know, I was chairman of the Rail Freight Group for some years. It is designed to put a requirement on the Government to report on the rail network capacity used by rail freight and to confirm a target of at least 75% growth in freight carried by rail by 2050 compared with 2019.
I am grateful to my noble friend the Minister for his quite long letter, which we received over the weekend, explaining different parts of this Bill. I welcome the letter; there are some good points in it and he answered my question, as he has not done so far today, about open access passenger services. The letter is there, so I do not need his answer again, and I am grateful to him.
However, what we have here is a Government who, as the Minister states in his letter, are clear on open access passenger services and want to encourage rail freight. The letter says that
“to enable the growth of rail freight … the Secretary of State will set an overall freight growth target to ensure that it remains a key priority”.
That is good. My question is how this will be achieved. Within the Great British Railways envelope, we have GBR itself, freight operators and the freight sectors. We also have the Office of Rail and Road, with “rail” apparently to be defined in the next Bill, and we have open access operators. All these groups will be vying to get capacity on lines or tracks that, as many noble Lords have said, are congested at the moment.
It is not just a question of how we get capacity on the track. I am told that, on the east coast main line, the current LNER service apparently wants to have five trains an hour running more-or-less non-stop from Edinburgh to London—I hope they find the passengers from somewhere. That is going to cause serious problems to the regional services which might want to cross that line at York or Doncaster or somewhere else. It puts into question the Government’s priorities: getting to Edinburgh every 10 minutes, or so, or getting across the main line from the Humber to Leeds, or similar places, on a service which may only run once an hour because there is no capacity.
The capacity divide between the long-distance passenger services and local services is something that we will need to explore in the future, but capacity also affects freight. One of the issues with freight which we have heard for many months, if not years, is that it needs a different speed of train because it cannot accelerate that quickly, and therefore needs electrification—which I am not going to go into. Something that has come up in your Lordships’ House so often is the improvement of the railway at Ely on the route between Felixstowe and Nuneaton or the north. Improvements there would enable many more freight trains to use that route, saving them from trundling along the North London line and places like that. Such improvements would also enable the capacity for freight; it just needs electrification.
Great British Railways will be in charge of the budget for railway investment and infrastructure, as well as the budget for keeping the passenger trains going. It will therefore effectively be in competition with the private sector operators and freight companies, and very careful work will be needed to ensure the allocation of capacity is fair and transparent. In my book, it is pretty unfair if one of the major operators, which will be GBR, in line with the infrastructure manager, which it will also own, will have control over how much capacity is available for freight—which is in the private sector—or open-access operators.
I am making this point because, while I think that producing a report after the first year—which my amendment would mandate—and looking for targets is a good start, we will need from the Minister, now or in the future, much firmer commitments on how much capacity will be needed on the main intercity or congested routes, and how the Government will allocate it. I look forward to further discussions with the Minister on this at some stage, but for the moment I beg to move.
Baroness Pidgeon (LD)
My Lords, I rise to speak to Amendment 40, which is focused on the issue of policing and safety on the railways. I welcome the Minister to his new role; I look forward to working with him, asking him many questions and debating the issues, as we have done elsewhere over the last 16 years.
As noble Lords have interrogated this legislation, safety has been a feature of our deliberations. However, safety is not just about the infrastructure and rolling stock; it is about the safety of passengers and staff on our railways. This amendment would require the Secretary of State to report to Parliament on the impact of this Act on the British Transport Police. The British Transport Police provides a policing service to Network Rail, rail and freight operators and their passengers and staff throughout England, Wales and Scotland. It is also responsible for policing other parts of our transport network including the London Underground, the Glasgow Subway, the Tyne and Wear Metro, the West Midlands Metro, the Docklands Light Railway, London trams and even the cable car in London.
What is different about the British Transport Police is that it is primarily funded by the railway industry, not the public purse, and it sits within the Department for Transport, not the Home Office. The train operating companies, Network Rail, other operators and Transport for London, through either police service agreements or different funding agreements, pay for the British Transport Police—its latest budget shows annual funding of around £416 million.
On these Benches, we are concerned about two specific areas. First, we are worried about the impact on policing the network, and the safety of staff and passengers as they use and work on our railways, as these changes to franchising take place. Secondly, we are deeply concerned about the potential significant funding gap, which had not previously been identified, as a result of taking public ownership of the railways. I hope the Minister will be able to provide assurance in this area and explain the Government’s thinking about the future funding of the British Transport Police.
Furthermore, there is the issue of the British Transport Police Authority itself and how it is structured. It consists of 15 members, often with railway expertise from the train operating companies, who ensure value for money for the policing service they provide across the network. It is not clear how this will be structured going forward to ensure the right level of challenge and independence from the Department for Transport, given the department will now be effectively running the railway in public ownership. I hope the Minister can reassure noble Lords that the funding and oversight of the British Transport Police has been considered as part of this legislation, and that he will respond to our specific points.
My noble friends will speak to our Amendments 41 and 6 regarding freight operators and the impact of this legislation on their operation.
Lord Bradshaw (LD)
My Lords, on the issue of freight, the intention should be that the freight service is given dedicated paths in the timetable. The timetable is the key to the whole issue. For freight to have a dedicated path, we need to use the paths that are available, or potentially available, to the best advantage.
To take the east coast main line as an example, it is possible to run quite a lot more trains along that line if the open-access operations are run by 10-coach trains which are divided en route. If the investment in the east coast main line is carried through, and if, for example, the Newark flat crossing is removed, I am sure we can get at least three, possibly four, more paths in every hour. The removal of the Newark flat crossing would greatly enhance the ability of freight to run inland from Immingham.
The Government have proposals before them to undertake very small pieces of electrification which would better connect freight services to the electrified network. They also have proposals, which the noble Lord, Lord Berkeley, has mentioned, to get the route between Felixstowe and Nuneaton working properly. That is an appalling railway—I have ridden across it on a locomotive—and it inflicts enormous delays on freight trains. If there is any money to spend, a good deal of virtue would come from spending on enhancing the freight network and creating more paths on the east coast main line, because they are scarce and very valuable.
Lord Young of Cookham (Con)
My Lords, I support the point made by the noble Lord, Lord Berkeley, about the potential conflict of interest under the new scenario: we will have Great British Railways, with a single operating mind, carrying all the revenue risk for passenger train operations, while at the same time there will be open-access operators and freight operators bidding for a limited path on the railways.
The former Secretary of State said:
“I shouldn’t need to approve whether a passenger train ought to be removed from the timetable to allow a freight train to run instead, as I was doing earlier today”.
The question is: who is going to make that decision in the future? If it is going to be GBR, as the noble Lord, Lord Berkeley, said, there is a clear conflict of interest; the company would have an interest in the passenger train operator having precedence in order to secure the revenue. That may be in conflict with government policy, which is to promote the transfer of freight from road to rail. Surely it is important that at the moment, the train operator cannot insist that he has a particular path for his train: he has to bid either to Network Rail or to the ORR. Who is going to make that decision in the future? Will it be a domestic one within GBR? In which case, how will the conflict of interest raised by the noble Lord, Lord Berkeley, be resolved in a way that is satisfactory for both the open-access operator and the freight train operator, which may find that they do not have the paths they wanted?
Baroness Randerson (LD)
My Lords, this small group of amendments addresses a number of issues that inevitably raise questions, because this very tightly drawn Bill provides no hint of how they are to be dealt with. I participate in this debate with some temerity following contributions by the noble Lord, Lord Berkeley, and my noble friend Lord Bradshaw, who know so much detail about the freight industry.
Liberal Democrat Amendments 40 and 41, to which I have added my name, are therefore probing amendments looking for details of government plans, which I hope the Minister can supply today. There are thousands of jobs and potentially billions of pounds of investment riding on the Government’s answers to these questions.
Amendment 40 is about a very specific issue but, as my noble friend Lady Pidgeon has emphasised, the role of the British Transport Police is vital, providing the rule of law on our trains. It is important to remember that the rule of law provides consumer and passenger confidence. Those of us who are older, younger or weaker are particularly dependent on the good offices of the BTP because they provide the assurance that people need before they are prepared to travel on our trains.
I emphasise that, as my noble friend said, British Transport Police funding has been provided virtually unseen from within the industry for a very long time. The total amount of money, at nearly £500 million a year, is not inconsiderable. It is therefore important that we have a clear answer now from the Government about they intend to deal with BTP in the future. In particular, how will it be overseen? Will that be with independence and at arm’s length from the Government? Which body will do that supervision?
Amendment 41, on freight, deals with a much more substantial and complex issue, because the freight industry is so complex. As the noble Lord, Lord Berkeley, said, it is essential that the new system be set up to encourage rail freight to improve its efficiency. That will be difficult, as he emphasised, because a centralised, nationalised Great British Railways will be bound to feel pressure to prioritise passenger services. We have crowded tracks running at capacity. We have vocal passengers who want trains at a time and a frequency convenient to them. We have a Government who have sponsored a nationalisation project, and their reputation will be damaged if passengers’ interests suffer. We also have a Government who emphasise that they are facing a financial black hole. Will they be willing to invest in track and signal modernisation of the sort outlined by my noble friend Lord Bradshaw, to benefit freight rather than passengers?
I fear that freight could rapidly become a poor relation, so I am keen to hear details and reassurance from the Minister. I thank him for his letter, but I point out that it says that next year’s railways Bill will “enable” the growth of freight. I emphasise that I would much prefer a duty to promote the growth of freight, rather than simply enabling it.
Lord Moylan (Con)
My Lords, I shall speak first to Amendment 40, concerning the British Transport Police, in the name of the noble Baroness, Lady Pidgeon. I associate myself with everything she has said about the importance of the British Transport Police in maintaining safety and law on the railway network and indeed in promoting a sense of safety, which is almost as important. That is particularly true, if I may say this, for women travelling on the railways, perhaps on their own. If they do not feel safe, they will not travel on the railways, it is as simple as that, and the British Transport Police have an important role to play in that regard. Fortunately, there is generally a good record of personal safety on the railways, but we want to see how the Bill will enhance that.
My figures may be terribly out of date, but when I was last involved, half the funding that the British Transport Police received came from Transport for London for services in London, and the rest was spread throughout the rest of the country. I will not say that the railway companies were not procuring enough British Transport Police to do the job—the test of that, of course, is whether there is criminality on the system—but they were not procuring at the same rate of coverage that Transport for London was procuring at. This is an opportunity for the Government to say, as they take control of the companies, how they are going to ramp that up and what investment they are going to make in it. I hope to hear from the Minister on that point.
A very interesting constitutional point was raised by the noble Baroness, Lady Pidgeon, which I had not heard expressed in any way before: how is the British Transport Police Authority to be constituted? At the moment it is constituted in large measure through representatives of the train operating companies. If there is effectively only one train operating company, which is the Government, how is it going to be constituted? As the noble Baroness says, it operates out of the Department for Transport. Is it going to become the first government department in this country—I think this is correct—to have its own police force? Even the Home Office, out of which ordinary policing operates, does not have its own police force; they are all accountable to police authorities or, now, to elected police and crime commissioners in appropriate areas, or to the Mayor of London in his capacity in London, and so forth. Could we end up in a constitutional nightmare here, a car crash that the Government have not properly thought through, as a result of this proposal to nationalise all these railways? Again, I would be interested to hear what the Minister has to say.
Turning to freight, I share the concern of the noble Baroness, Lady Randerson, about expressing too definite opinions on this topic, especially in the presence of the noble Lords, Lord Berkeley and Lord Bradshaw, who have such considerable and long-term prior knowledge of it. I have some slight sympathy with the Government on the point because, while I may be wrong about this, I understand that there are freight companies that have rights to paths which they do not use but will not relinquish because they may be useful in the future—and why should they relinquish them?—while, at the same time, they might want to have access to other paths which they cannot get hold of. This is slightly a mess, so perhaps there is some work for the Government to do here to sort it out.
The previous Government also had, as I understand it, a rail freight growth target: to increase rail freight by 75% by 2050. So far, that has not been mentioned and we have not heard yet whether the new Government wish to commit themselves to that target. Again, there is an opportunity for the Minister to say that that is his target when he gets to his feet. We would like to hear more about that.
The Minister may want to say that some of those points can be addressed in the future Bill—the Bill we are promised that is further down the road—but he cannot say that of the points raised by my noble friend Lord Young of Cookham and the noble Lord, Lord Berkeley, both of whom made the point that the way in which this is now proceeding, by contrast with the Williams report, creates a fundamental and ineradicable conflict of interest in the role of Great British Railways. When it was the body—the great controlling brain, as I referred to it—that was going to establish who could run what railway services where and, where appropriate, award franchises or concessions for passenger railway services, while also allowing open access and allowing freight services to take place, it could do that from a disinterested position. It would be allocating resource presumably according to some sort of rational principle that could be explained and interrogated by interested members of the public and other parties with a stake in the matter.
Now, of course, it is always going to be the case that Great British Railways will also be the operator of the passenger services—so what about the other services? What about open access and, most particularly as far as this group of amendments is concerned, where does freight get a look in? How does it make its case and to whom does it appeal if it feels it is unjustly done by? Is it to be allowed to appeal only to the courts or could there be a truly independent body outside Great British Railways—perhaps the Office of Rail and Road; I do not know—to which appeals could be made and which would decide and allocate these paths, where they are constrained, on a rational basis?
We have no idea about this because the Bill, as I said earlier, is being rushed through for manifesto and publicity reasons—for headline reasons, fundamentally—without these crucial questions that it throws up being answered. They are not my questions; I did not table these amendments. They come from Benches on all sides of the House. These questions are being thrown up and the Government have no answer, except the tune we are getting accustomed to, which has as its first verse, “It’s in the manifesto” and as its second verse, “We’ll tell you when we get to it some time next year”. I hope we can do better than that when the Minister gets to his feet.
Lord Hendy of Richmond Hill (Lab)
I will first say that I am delighted to see the noble Baroness, Lady Pidgeon, in her place. I hope that her questions will be easier than the ones she has asked me for the last 16 years.
I thank noble Lords for explaining their amendments in this group, which consider the impacts of public ownership on the freight sector and the British Transport Police. I shall speak first to Amendment 6, in the names of my noble friend Lord Berkeley and the noble Lord, Lord Moylan, and Amendment 41 in the names of the noble Baroness, Lady Randerson, and the noble Lords, Lord Bradshaw and Lord Moylan.
These amendments highlight the importance of the rail freight sector, which has a crucial role to play in supporting a productive economy and in helping to decarbonise transport on the way to net zero. The Bill in front of the House sets out with two very specific purposes: to enable franchised passenger services to be brought into public ownership as existing contracts expire, and then to enable the Government to keep them there in accordance with their manifesto commitment. As such, the Bill has no direct impact on freight operators or on the availability of network capacity to accommodate freight services. Indirectly, though, freight operators should benefit from public ownership of passenger services, for reasons I am happy to explain.
In the old franchising model before the pandemic, a franchise operator’s commercial motivation was to maximise its own profit—evidently, the difference between its revenues and its costs. If that meant running additional services, it would seek to do so through the usual industry processes of bidding for access rights and then for a timetable that included the extra services. It would not matter, and has not mattered, to the franchise operators that this might deprive freight operators of the opportunity to serve new markets in the future. There are various examples of franchise bidders seeking to win contracts on the back of proposed service enhancements that risked crowding out, or actually have crowded out, potential future freight growth.
Under public ownership, that unfortunate incentive will no longer exist. Publicly owned operators will instead be remitted to act in the interests of all users of the railway, including freight customers. We have made it clear that the forthcoming railways Bill will require Great British Railways to enable the growth of rail freight and that the Secretary of State will set an overall freight growth target to ensure that it remains a key priority. I am sure that we will debate these points further once the railways Bill is before your Lordships’ House.
The noble Lords, Lord Bradshaw and Lord Young, my noble friend Lord Berkeley and others asked how capacity will be allocated. I can certainly tell them how it is done now, because we have had an immense struggle to obtain a timetable on the east coast main line which seeks to justify the £4 billion-worth of public investment to speed up services and provide more passenger capacity. One reason we have had that struggle is that, although there is an appeal mechanism to the Office of Rail and Road, there is in fact no current decision-making process to allow a timetable to be completed, except by agreement. I believe and hope that it is currently in its last stages, but I am not certain.
One of the things that the Government have in mind is that Great British Railways ought to be the body that decides. The noble Lord, Lord Bradshaw, will recall what was the case on the old railway: somebody had to decide which services were of greatest priority and which ones had to be fitted round them. Under the current Bill, however, there is no change to the existing role of the ORR in access decisions for passenger and freight services. Under the future railways Bill—and we will consult on this—there will be appropriate safeguards for both freight and open access operators. We will set out details on that in due course, before any changes to the current approach are made. There is no need to require the publication of a report on this matter. Commissioning a report after this Bill, when in fact there will be no change at this point, will not add benefit to the debate.
I turn next to Amendment 40, in the names of the noble Baronesses, Lady Pidgeon and Lady Randerson, and the noble Lord, Lord Moylan.
Lord Liddle (Lab)
Before we move on to the British Transport Police and while we are still considering freight paths, the noble Lord, Lord Bradshaw, for whom I have enormous respect because of his experience on the railway, made the point that investment decisions are very important to getting more freight on to the railway. Is not the real question about freight the priority it is given in the investment decision-making process? I know the Bill is not about that, but, since there is concern about this in the Committee, can the Minister give us any guidance as to how investment will be prioritised?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend Lord Liddle for that intervention. All I can say at this point is that I would hope the rail network enhancement programme is published more frequently, and with more success in what it contains, than it has been for some years. We will have to wait and see what the fiscal situation allows.
Lord Liddle (Lab)
Would that be a decision for the Secretary of State or for Great British Railways?
Lord Hendy of Richmond Hill (Lab)
I think in due course we will have to come back in the substantive Bill with a proposition on how those decisions are made, who makes them, and for what period of time the plan is valid.
Lord Berkeley (Lab)
My Lords, I am grateful to my noble friend for his response to my amendment and other people’s. I have one or two questions that I hope will help the extended debate, because I do not believe we can leave the most important question of competition, which a number of noble Lords have mentioned.
Lord Teverson (LD)
Before the noble Lord sums up on his amendment, I think the Minister has yet to reply on the issue of the police.
Lord Hendy of Richmond Hill (Lab)
I apologise to the Committee; it is my novice inexperience. I thank the noble Lord for that intervention.
I turn to Amendment 40 in the names of the noble Baronesses, Lady Pidgeon and Lady Randerson, and the noble Lord, Lord Moylan. Amendment 40 would require the Secretary of State to report to Parliament on the impact of the Bill on the British Transport Police 12 months after its enactment. The BTP is governed by the Railways and Transport Safety Act 2003, which is not affected by this Bill. Under the 2003 Act, the British Transport Police Authority is responsible for the efficient and effective policing of the railways and for maintaining the British Transport Police force. The authority sets annual budgets for the BTP and recovers the costs of the BTP from the rail industry—of course, now, notably, this is all paid for by government—by entering into police service agreements. The authority sets the funding contributions for each railway service provider via a cost allocation model to ensure that contributions reflect the services provided by BTP and cover its costs.
Under the 2003 Act, the Secretary of State has made an order which requires railway service operators, as well as Network Rail, to enter into police services agreements. This obligation applies equally to public sector operators and private sector franchisees, and I can confirm that all four existing operators under DOHL have a police services agreement in place.
In conclusion, there is no reason to believe that public ownership under this Bill would have any adverse impacts on the freight industry or the BTP, so I hope my noble friend will be persuaded to withdraw his amendment.
Lord Berkeley (Lab)
My Lords, I apologise for intervening earlier and preventing my noble friend responding on the British Transport Police issue, which is most important. I would like to ask him whether it applies to Scotland.
About 10 years ago we had a debate here when the Scottish Government wished the Scottish police to take over British Transport Police activities in Scotland. My noble friend Lord Faulkner of Worcester and I tried to argue—I think the noble Lord, Lord Bradshaw, was there too—that this was a bad idea because policing the railways is fairly specialist work, as the noble Baroness, Lady Pidgeon, has told us. We ended up trying to divide the House at about midnight, which my Chief Whip at that time did not think was a particularly good idea because I had not told him about it. I pointed out that he was probably in bed asleep by then. Anyway, we did not win that time, but we did manage to achieve BTP having responsibility for railways in Scotland. It would be nice if my noble friend the Minister could explain how that will work under the new GBR system.
I will respond to my noble friend’s comments on the other issue, which is mainly about capacity and competition—whether it is freight, open-access operators or whatever. It was interesting that he said that the Government invested £4 billion in the east coast main line. That must have been in order to get an extra train per hour and a few other trains between Edinburgh and London. I am wondering who decided that it was a good thing to invest in the east coast main line to get more intercity services, rather than more freight or cross-country services. That it has not been delivered yet indicates that something else needs resolving, and we will have to see what that is.
The other issue is straight competition. I was not working on the railways before privatisation. I am assuming that Great British Railways in its 1990s shape had a number of divisions, as a noble Lord told us, including a freight division. That obviously worked very well at that stage, but when those in the freight division wanted another pass or two on a main line, I would hazard a guess that they had quite a job persuading the passenger people to move over a bit and give them space.
Great British Railways will be a monolith organisation. I am sure that underneath, it will have lots of subdivisions, which we will debate at some point. This will probably include the intercity services and regional services, and it will have to take into account open-access passenger and freight services. I cannot see how it will be able to demonstrate a fair allocation of paths when, as the noble Lord, Lord Young, mentioned, it will get all the extra revenue from an extra train if it is a GBR train, but no revenue apart from track access charges if it is an open-access train or a freight train.
This is a really serious and financially challenging discussion that we will need to have. I hope my noble friend will be able to respond in part to what I have said. I hope he will be prepared to meet me and anybody else who is interested in this competition issue before Report. I would like to see some wording in the Bill that would give open access passenger and freight some comfort that what goes in the next Bill will not send them over the edge. Could my noble friend respond to those points? I do not know whether he is prepared to.
Lord Hendy of Richmond Hill (Lab)
I will respond to my noble friend by either talking to him outside or writing to him.
Infected Blood Compensation Scheme Regulations 2024
(2 months ago)
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Lord Ponsonby of Shulbrede
That the Regulations laid before the House on 23 August be approved.
Relevant document: 2nd Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Ponsonby of Shulbrede) (Lab)
My Lords, I start by reminding the House why we are here. The infected blood scandal is a mark of shame on the British state. The infected blood inquiry’s final report, published on 20 May, shed light on the trauma inflicted on thousands of people across the country, through no fault of their own. People were given contaminated blood or blood products, contracted HIV, hepatitis C and hepatitis B, and then for years had their voices ignored. People who loved, knew and cared for someone who was infected—those who were affected—similarly had their voices ignored. This did nothing but compound the trauma of all involved.
The infected blood inquiry’s second interim report set out 18 recommendations on compensation, informed by Sir Robert Francis’s 2022 compensation scheme study. The inquiry was unequivocal that a compensation scheme must be set up immediately. The regulations we are debating are essential for delivering that compensation scheme and getting money to people as quickly as we can.
The scheme is based on the recommendations and principles put forward by the inquiry. In line with these, and supported by the advice from the inquiry response expert group and the engagement exercise that Sir Robert Francis undertook in June, the Government have sought to design a fair and comprehensive compensation scheme that will be quick and simple for eligible applicants to access. We support the shared determination across the House to deliver compensation as swiftly as possible and with the minimum possible delay. These regulations are a significant step towards that.
I turn first to eligibility. The scheme and the regulations define people who are eligible as infected people, in line with recommendation 2 of the inquiry’s second interim report. This covers people infected with HIV, hepatitis C and hepatitis B, including people directly infected by treatment with blood, as well as people indirectly infected via transmission from a directly infected person.
Secondly, the regulations establish a core route for claiming compensation as an infected person. The core route provides compensation under five awards, or categories of loss, as set out in recommendation 6 of the inquiry’s report. These awards include an injury impact award, a social impact award, a care award, a financial loss award and an autonomy award, which together will comprise the total compensation award to be given to infected individuals, or to the estates of any deceased individuals, to recognise the wide-ranging harm resulting from their infection.
Earlier this year, the Victims and Prisoners Act established the Infected Blood Compensation Authority in law to deliver the scheme, and with these regulations we are providing the authority with the legal powers needed to begin making payments. The regulations also provide further detail on how the Infected Blood Compensation Authority will accept applications and pay awards.
Since the authority was established in law, it has been working hard to design and implement effective, simple and secure processes for members of the community, with their input, to claim the compensation that they so clearly deserve. Last week, the Infected Blood Compensation Authority reached out to the very first claimants under the infected blood compensation scheme. The authority is taking a “test and learn” approach, which will ensure it can take on board feedback and improve the service before it opens its full compensation service. This is a significant step towards our shared intention to begin payments by the end of this year and ultimately will ensure that the service is as fast and as simple as possible when it opens for everyone. I hope this step provides confidence that we, and the authority, are absolutely committed to driving forward progress with the scheme in a way that puts the infected blood community at the heart of our work. The Government expect the authority to begin making payments by the end of this year.
I will speak now to the concerns raised by the Secondary Legislation Scrutiny Committee, which I believe noble Lords may wish to raise in today’s debate. As the committee noted, the infected blood scandal stretches back over many decades and access to records, such as medical records, may not be possible or may be very challenging. Where this is the case, the authority will need to make objective decisions relying on the evidence that is available to determine, on the balance of probabilities, that treatment with infected blood occurred. The authority will provide assistance to those who believe their medical records have been lost or destroyed, and evidencing eligibility will be easier, faster and more compassionate than, for example, through any court proceedings.
The committee also raised concerns around the complexity of the regulations and the Explanatory Memorandum not being clear enough to explain the practical operation of the scheme. Given the complexity of the regulations, we were aware that they would not enable individuals to understand the scheme. That is why, alongside the publication of the regulations and the Explanatory Memorandum, the Government published a detailed policy paper in August on how the compensation scheme will operate, setting out what individuals can expect to receive, including case study examples. Additionally, the Infected Blood Compensation Authority will aim to ensure that appropriate advice and support are available to assist people with managing their compensation awards, accessing financial services and accessing benefits advice where relevant.
Thirdly, the committee raised a concern regarding how claimants will receive payments. As set out in recommendation 10 of the infected blood inquiry’s second interim report, the regulations include an option for members of the community to choose between receiving payments as periodic compensation or as a lump sum. Providing people who are due compensation with a choice in how they receive their money is something the infected blood community has highlighted as important to claimants. The regulations include a mechanism for electing for periodic compensation payments or a lump sum, responding to the wishes of those who have told us they want this option.
We have also provided an alternative for those currently receiving support scheme payments through the infected blood support schemes. The IBSS route was developed following the recommendations of Sir Robert Francis, who undertook engagement with representatives of the infected blood community in June.
The biggest concern raised in this engagement was around the continuation of the existing support scheme payments. Following Sir Robert’s recommendations, the Government have agreed that support scheme payments will continue for life for those who elect the IBSS route. This route will be available for those who applied to be registered on a support scheme on or before 31 March 2025 and delivered as part of the compensation package.
In a tariff-based scheme designed to be fast, fair, consistent and secure, we hope that people will be satisfied that they have been provided with full and fair compensation, as the scheme sets out. However, should this not be the case, the regulations make provision concerning review of decisions made by the authority and for appeals to the First-tier Tribunal.
I know that this House is in complete agreement when it comes to paying long-overdue compensation to those impacted by this harrowing scandal. Following the passing of the Victims and Prisoners Act, these regulations are the next substantial step towards getting money into the hands of those who deserve it. However, the work is far from finished and I pay tribute to the noble Baroness, Lady Brinton, for providing the opportunity for the House, through the regret amendment that she has laid, to recognise that there is more work to be done to establish the scheme for parents, children, siblings and carers. I reassure the House that a second set of regulations will provide for other elements of the compensation scheme, including compensation payments to people who are affected and for claims outside the core route. Subject to parliamentary approval, the Government are aiming for the second set of regulations to be in place by 31 March 2025 to support our intention that people who are affected can start receiving payments in 2025.
I hope that colleagues will join me in supporting these regulations and I beg to move.
Amendment to the Motion
Baroness Brinton
At end insert “but that this House, while welcoming the progress made to compensate eligible infected persons, regrets that close family members and carers affected by the infected blood scandal are not included in the Regulations, as recommended by the Inquiry”.
Baroness Brinton (LD)
My Lords, I start by saying that I shall not call a vote on my regret amendment. It is important to avoid any delay to the infected blood victims receiving either interims or full compensation settlements—it would be wrong. However, I have a number of questions relating to this instrument and to the one that the Government say that they will lay next year. It is good to see the Minister in his place, as well as the noble Earl, Lord Howe, on the other Benches, because it was we three who debated this in detail during the passage of the Victims and Prisoners Bill.
I understand that these are complex matters, but at the root of them is the vital and delicate issue of trust with the victims of this scandal. Would the Minister meet me, as well as writing to me with some of the detailed answers to my questions that I have today, which I appreciate that I have not been able to give him advance sight of? I also thank the Secondary Legislation Scrutiny Committee, and the Minister for responding to its concerns. In its second report of this Session, it points out that the Explanatory Memorandum is
“overly complex and technical, while lacking basic information”.
At paragraph 44, it points out that there is “no clarity” about how many infected persons will have been paid by the end of this year.
The September Statement from the Paymaster-General talked about a “user group” testing out the new scheme. Can the Minister confirm that this user group, or the group that he described a couple of minutes ago—the “test and learn” group—comprises only 20 people? Will those 20 people be paid by the end of this year and how many others of the eligible infected persons will receive their settlements by the end of this year? Is there now a likely time when those infected persons already in the system will have received payment?
The main reason I move this regret amendment is that the regulation in front of us today does not deal with the group of victims called the “affected”. As the Minister said, these are the wives, partners, parents, children and siblings of infected victims. The Victims and Prisoners Act, passed on the last day of Parliament before the general election, sets out in Section 49 the definition of the two groups of people entitled to compensation under the scheme. The outgoing Government were absolutely clear that they wanted the regulations for the compensation scheme within three months of passing the Bill, which is why this regulation, 872, was laid on 24 August, in the depths of recess, and brought into effect immediately under the emergency processes. I am very grateful to the Paymaster-General for telephoning me on 22 August to explain that the Government were keeping to the arrangements made by the previous Government.
Earl Howe (Con)
My Lords, I am grateful to the Minister for introducing these regulations, which, as he has explained, fulfil one element of Sir Brian Langstaff’s carefully calibrated recommendations for establishing an infected blood compensation scheme, both as set out in his inquiry report and as amended in the light of the engagement exercise carried out by Sir Robert Francis in June. The regulations we are considering relate specifically to those individuals directly or indirectly infected by contaminated blood, blood products or tissue. Still to come at a future date, as we have heard, are regulations to extend the scheme to those who, in various ways, have been affected by the infected blood disaster; and I shall come back to that issue in a second.
Knowing, as I do, how the detailed architecture of the compensation scheme has been devised, based as it is on Sir Brian’s recommendations, and on the careful and considered advice to Ministers given by Sir Jonathan Montgomery’s expert group, I do not argue for a second with either the appropriateness of the eligibility criteria or the proposed category headings under which compensation is to be awarded. I have some questions, however.
The product of Sir Robert Francis’s engagement exercise was a total of 74 recommendations for modifying the detail of the compensation scheme, as previously announced. Of those 74 recommendations, the Government accepted 69. I have to be candid and say that I was very surprised by how high that number was, since I did not think it likely that either Sir Jonathan Montgomery or my right honourable friend the former Minister for the Cabinet Office would have neglected to take account of any aspect of harm caused by infected blood, or misjudged the appropriateness of the levels of compensation under each category of harm. However, my being surprised is not the same thing as saying that I have any issue with the Government’s decisions on this score: I am quite sure that they will have done the fair and decent thing. In an important sense, the fact that there were so many recommendations for modifying the scheme goes to demonstrate only how worthwhile the engagement exercise was. We can be glad of that.
What nags at me, though, is a worry about complexity. The Secondary Legislation Scrutiny Committee noted this complexity and criticised the Explanatory Memorandum to the regulations for what the Committee saw as a failure to explain clearly either the basis of the compensation scheme or the practical aspects of the compensation arrangements. Those criticisms are regrettable, but to my mind they highlight what I feared might be a consequence of accepting 69 modifications to the scheme, which was that these would serve only to accentuate the complexity already built into the scheme architecture. It is surely axiomatic that the more complex the arrangements, the more likely it is that accurate and timely payment of compensation will be put in jeopardy.
There is one obvious example where this might be the case. The Government have agreed that those people registered with the infected blood support scheme will continue to receive regular support scheme payments for life, running in parallel with compensation payments from the Infected Blood Compensation Authority. On the face of it, having two channels of funding as opposed to a single channel runs the risk of both error and delay in delivering to people the money due to them. What reassurance can the Minister give me on this?
There is another, quite different, example of where delay could occur. Sir Robert Francis’s recommendation 18, which the Government appear to have accepted, was that, under the injury impact award heading, not enough attention had been paid to psychological illness as opposed to emotional distress and anxiety.
Lord Ponsonby of Shulbrede (Lab)
I thank both the noble Baroness, Lady Brinton, and the noble Earl, Lord Howe, for their very thoughtful discussion of the regulations. I recognise they have both had long experience of these issues. As the noble Baroness, Lady Brinton, said, the three of us were involved in the passing of the Victims and Prisoners Act, which was a precursor to these regulations.
In response to the very last question of the noble Earl, the Government are aiming for a second set of regulations to be in place—regarding affected people—by 31 March 2025. It is our intention that people who are affected can start receiving payments in 2025. That was in my original speech and that is the Government’s commitment.
I will make a general point before I start trying to answer some of the individual questions. It is in the best interests of everybody that the House continues to work collaboratively on this issue—both for infected and affected people. All sides of the House acknowledge the British state has failed the victims, and these regulations are a step on the road to addressing the infected victims.
Of course I will agree to meet the noble Baroness, Lady Brinton, and the noble Earl, Lord Howe, if he so wishes. I will write with detailed answers if I fail to answer any of the questions—no doubt I will fail to answer some.
As the noble Earl quite rightly said as he introduced his comments, these regulations are fulfilling one element of Sir Brian Langstaff’s report. A lot of the questions have been about the second element: the affected people. As he rightly said, 69 of the 74 recommendations were accepted.
On the bulk of the speech by the noble Baroness, Lady Brinton, which was about the affected people, the timetable available to develop these regulations was necessarily limited. The regulations prioritise people who are infected as a result of the infected blood scandal. Where people have sadly died, the recommendations make provisions for claims under their estate. This ensures the Infected Blood Compensation Authority can start delivering the compensation scheme for the infected, as per its statutory function.
The Government’s decision to split, and therefore sequence, infected and affected regulations was taken with the reassurance that it would allow orderly implementation of the legal framework without impacting or delaying the delivery timetable for payments to infected and affected victims. Subject to parliamentary approval, the Government are aiming for the second set of regulations to be in place by 31 March next year, as I mentioned, with an expectation of beginning payments by the end of the year.
The noble Baroness, Lady Brinton, also asked about the eligibility of affected siblings and children. The scheme’s definition of siblings is based on the recommendations made in Sir Robert Francis’s compensation framework study. The definition recognises the likely heightened impacts on a sibling living with an infected person during childhood. This is not to dismiss or deny the suffering of those who were adults when their siblings were infected. Individuals who were adults when their sibling was infected may be eligible for compensation through the scheme as a carer. Siblings will be eligible where under the age of 18 they lived in the same household as an infected person for the period of at least two years after the onset of the infection. Similarly, the scheme’s definition of children of the infected person is based on the recommendations made in Sir Robert Francis’s compensation framework study. The scheme recognises the likely heightened impact on a child who was under 18 while living with a parent who was infected.
I hope that provides some clarity to the noble Baroness. However, I will also acknowledge the examples she gave of the terrible effects on affected people and the terrible experiences, some of which she spoke about. It is absolutely not right to suggest that affected people are somehow second-class citizens. That is not right; it is just a practical decision which the Government have made to try and progress these matters as soon as possible. These regulations are for the infected group, but I have set out as clearly as I can what the Government’s intentions are for the affected group.
The noble Earl, Lord Howe, spoke about the complexity of regulations and the Explanatory Memorandum. Work is under way on a second set of regulations. We will take on board the committee’s helpful feedback when drafting the Explanatory Memorandum for those regulations. We recognise the point made by the SLSC on the complexity of these regulations, but it is absolutely the Government’s intention to carefully consider the committee’s report and findings.
The noble Earl asked about the two channels of funding: the core route and the IBCS route. This is an additional level of complexity, but it was recommended by Sir Robert Francis because it was the wish of the infected group that the existing method of funding should continue. Because we accepted that recommendation, that inevitably adds to the complexity.
The noble Earl also asked about psychological illness, and in particular whether recommendations were accepted by the report. I am afraid I do not know the answer to that, but I will write to the noble Earl and the noble Baroness about it.
The noble Earl also raised Treloar’s school and unethical experimental research on certain young children. It is absolutely not the intention that this particular scandal should lead to any delay in the rollout of infected or affected compensation, but we recognise the particular, scandalous nature of what happened to those victims.
In conclusion, we regard the timetable as realistic. In opposition, we worked constructively with the then Government, and we have continued working as practically as possible to try to move the timetable forward. All of us across this House must continue to work collaboratively. These regulations ensure that we can finally deliver compensation to those who fought so hard; they deserve nothing less. I beg to move.
Baroness Brinton (LD)
My Lords, I thank both the noble Earl, Lord Howe, and the Minister for their contributions to this debate. We are all broadly on the same page. I do not think there is a difference on the principles of moving ahead, and certainly absolutely no intention on my part to try to slow down or block the approval of the regulations today.
I will not go through the arguments we have all made, but the key thing the Minister did not cover was the issue of communication, which seems to me to be the most important thing moving forward. If there is confusion and distress on the one hand, and complexity and a large number of recommendations being modified on the other, it is absolutely understandable that the affected and the infected may have concerns about what is going on. I really hope that when we meet, the Minister will talk to us about what he plans to do.
I pay personal tribute to the noble Earl, Lord Howe, for the way he worked with the communities over the years. That baton has clearly been handed over to the other side of the House. We need to rebuild trust; there are a lot of very distressed people out there at the moment. With that, I beg leave to withdraw my amendment.
Passenger Railway Services (Public Ownership) Bill
Monday 21st October 2024
(2 months ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Act 2024 View all Passenger Railway Services (Public Ownership) Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-I(a) Amendments for Committee (Supplementary to the Marshalled List) - (18 Oct 2024)
Lord Moylan
“(1AA) Before making a direct award of a public service contract to a public sector company under subsection (1A), the relevant franchising authority must provide information to the Office of Rail and Road on the public sector company’s ability to become responsible for the provision of the relevant passenger railway services.(1AB) The information provided under subsection (1AA) must include an overview and analysis of the capacity of the public sector company to provide, maintain and improve the existing level of service. (1AC) Following the receipt of the information provided under subsection (1AA), the Office of Rail and Road must publish an opinion on whether it is reasonably practicable for the public sector company to provide, or secure the provision of, the relevant passenger railway services.”Member's explanatory statement
This amendment requires that the relevant franchising authority provides information to the ORR on a public sector company’s capability to provide adequate railway services.
Lord Moylan (Con)
My Lords, I will speak to Amendments 7 and 9, which together constitute this group. Both are concerned with what the Government say they intend to be the effect of the Bill: the improvement of passenger services. Again, they are largely probing amendments, although we would expect the Bill to be amended, if not with a purpose clause, as proposed earlier by my noble friend Lord Gascoigne, then at least with measures of the character contained in these two amendments, which seek to set a safety net, in effect, in different ways, for the services being provided.
Amendment 7 would have the effect that the relevant franchising authority must give to the Office of Rail and Road—it could be to some other trustworthy and credible body, such as the Department for Transport, if it is not the franchising authority—an assessment that the company that will take over the franchise is capable of doing so. People might ask: what company? The company that will take over the franchise as proposed by this Bill will be a shell company—an off-the-shelf company purchased by the Department for Transport; a perfectly ordinary company under companies law such as anyone might buy off the shelf. That already starts to raise questions around why we would think that it had any competence to run a railway. People will say, “Don’t be silly, that is just a form”. The form is an empty-shell company constituted under companies law, but the sole shareholder of that company will be the Department for Transport. In effect, the Department for Transport will be running this service through the shell company that it has bought off the shelf in order for it to be the recipient of the public service contract, which is the only type of contract that the Secretary of State will be able to award.
But the Minister said a little earlier in the debate— I cannot pin it down exactly without looking at Hansard, but I do not think that he will deny that he said it—that one of the main purposes of the Bill was to take out of the Department for Transport a whole load of stuff that it was no good at doing and give it to Great British Railways, because it would be better at doing it than the Department for Transport. Here we have a system proposed by the Bill in which the responsibility for operating a service will be taken from a train operating company with decades of experience of providing the service—perhaps, in some cases, hundreds of years of experience if it is a foreign railway company putting its foot into the British market and providing services to us—given to a company bought off the shelf, which is owned and controlled by a department that the Minister himself said should have functions taken away from it and transferred to Great British Railways. What sort of a mess is this?
That is why, very simply, this amendment asks for an assessment in advance as to whether that company —the operator—is fit for purpose. We are looking not simply at the shell company but at its shareholders and controllers—the people making the decisions. Why should not the public have that level of assurance before a franchise is terminated and transferred to such an entity? That is what the amendment is calling for, and there is a very strong case that it should be done.
The second amendment, Amendment 9, is not the same, but it points in a similar direction. Nothing is said in this Bill about what level of service the new operator will offer compared to the old operator. It is presumably for the Department for Transport or shadow Great British Railways—we do not know—to decide the terms and conditions of the public service contract that it will award. If it is the Department for Transport, it will award the contract to itself or to its shell company; if it is shadow Great British Railways, it will award it to the Department for Transport. Somebody will have to sit down and decide what those terms and conditions are. All we are asking in this amendment is that the services offered to the public should not be of a lower standard than they are under the existing franchise.
That is not to say that there is not the possibility of some sort of public consultation. That is what we have inserted. We have said that you can lower the services but that you have to consult publicly in advance. At the moment, that would be true on a transfer of a franchise. We have had no assurance from the Government that there will be a public consultation on the termination of a franchise and the award of a public service contract directly to one of the Department for Transport shell companies.
This is one of those issues about which the Government may want to say, ah ha, this will all be dealt with by the great big Bill coming down the rails towards us. That would be a grave mistake, because these issues relate specifically to this Bill and to what will happen the moment it starts to be implemented. As we discussed earlier, this Bill could be the governing statute of the operation of the railways for as much as four or five years, even if the Government have a good headwind behind their new measures and they come forward in time and are implemented reasonably. The public will want to know that our service levels are protected. Will they be consulted? Will the people who run these trains be fit for it, given that we know from the Minister that he does not think that they are fit for much else on the railways? I beg to move.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I thank the noble Lord, Lord Moylan, for his amendments.
Amendment 7 considers the capability of public sector companies to take over services and operate them to an appropriate standard. It is clearly a key priority for the Government that services should transfer to public ownership smoothly, without detriment to the quality of service during the transition. For this reason, the transfer of services will take place using established arrangements and processes which have previously fulfilled the Secretary of State’s operator of last resort duties. I remind the noble Lord, Lord Moylan, that this has taken place under the previous Government and their predecessors four times with no obvious risk to the delivery of service.
DOHL is the publicly owned company that already oversees four existing publicly owned operators. It has had significant experience of managing the transition of services from private to public operation in recent years. These transfers have been completed successfully and smoothly despite challenging timescales and circumstances, which have included franchise financial failure and poor operator performance. DOHL is therefore well-placed to manage future transitions and is building its capacity to do so as we speak.
The Government have made it clear that we will transfer services on a phased basis as existing contracts expire. This measured, responsible approach will further de-risk the transfer process. As an additional safety net, the Bill includes provision at Clause 2 to allow for temporary continuation of an existing franchise where the Secretary of State is satisfied that it is not reasonably practicable to complete a transfer in the timescales originally planned. We do not plan to use this power other than in genuinely exceptional circumstances, but it is prudent that it should be available if necessary as a last resort, given that everybody would agree that disruption to passengers should be avoided.
Amendment 7 also seeks to provide a new role for the independent regulator, the Office of Rail and Road. The ORR is the regulatory authority responsible for granting operator licences and for assessing, approving and issuing operators’ safety certificates. This Bill does not change this. In its existing role, the ORR will assess carefully the suitability and readiness of any operator—public or private, passenger or freight—to take over services and to operate them safely, and is experienced in doing so. Considering DOHL’s previous experience and track record, the further safeguards I have described and the existing regulatory role of the ORR, the Government do not see any need to commission further analysis from the ORR as this amendment proposes.
Amendment 9 would require the Secretary of State, Scottish Ministers or Welsh Ministers to undertake a public consultation before specifying or allowing any reduction in service levels at all within a contract with a public sector operator.
I start by saying that the Government want to grow rail passenger demand and revenues; we are not starting out with an objective to cut services. When services transfer to public ownership, as now, we will expect operators to clearly communicate all changes to services. I agree that, if there were to be a plan for material reductions in service levels, this should be the subject of public consultation. However, I cannot support a statutory obligation to hold a public consultation in relation to every change to the timetable or to any other aspect of the service specification that somebody might consider to be to their disadvantage.
If a service is so poorly used that it is clearly unnecessary to carry on running it, and there is an alternative train available at a similar time of day, is it really sensible to expend time and public money on a consultation process? If there is a high-frequency service and a slight reduction at a quieter time of day would enable train and/or infrastructure maintenance to be carried out more efficiently and effectively, does this really merit a public consultation? If, God forbid, there were another global pandemic, or other immediate and extraordinary event that caused a serious reduction in passenger demand, I submit that it would be absurd to suppose that a public consultation would be necessary before reducing service levels.
There should of course be consultation on material reductions in services, but to require it regardless of the scale or impact of a proposed change would impose a disproportionate burden. I therefore urge the noble Lord not to press this amendment and to withdraw the amendment I spoke to first.
Lord Moylan (Con)
My Lords, will the Minister state at the Dispatch Box not that there should be a public consultation in the event of a material reduction of services on transfer of a contract but that there will be? If so, I would be very happy to leave the matter there. I would like to give him the opportunity to say that it is the Government’s policy that there will be a consultation if there is a material reduction in services on transfer.
Lord Hendy of Richmond Hill (Lab)
In response to the noble Lord, I do not see those circumstances arising. However, I will take the point away and consider it during the progress of the Bill.
Lord Moylan (Con)
I note that the Minister has not been able to give that commitment. With that, I beg leave to withdraw my amendment.
Lord Moylan
“(1AA) Every contract made in accordance with subsection (1A) must place a duty on the public sector company to publish a plan for investment for innovation across all aspects of its operations, including but not limited to—(a) operational efficiency;(b) fares and ticketing;(c) stations and onboard services;(d) passenger information; and(e) digital transformation.”Member’s explanatory statement
This amendment requires all public sector companies awarded a contract to publish a plan for investment in every operational aspect of the railways.
Lord Moylan (Con)
My Lords, I think we are getting to the point where every question has the same answer, which is essentially either, “It is in the manifesto”, or “We’re going to tell you about it in the future”, or “How dare you imagine for a moment that anything could go wrong on our watch?” I suspect that this is where I am going to end up with this amendment.
The amendment is very simply stated. It requires that, before there is a transfer to a public sector operator, an investment plan should be published so that we know what will happen on the railway. The proposition is so simple, so self-evident and so straightforward that it hardly requires argument, and it certainly does not require any great explication. With that, I beg to move.
Lord Teverson (LD)
My Lords, I did not speak at Second Reading, but I often speak on issues around public investment. One of the things that concerns me greatly about this move, although generally I might be in favour of it, is that, internationally, public investment in this country tends to be extremely low. In fact, over the last 25 years, the average public sector investment is 1.8% of GDP, which most of the time is well below our equivalent G7 nations. However, if you look on it year to year, the graph is a rollercoaster that Alton Towers would probably be favourable to, because it goes up and down, up and down.
I was privileged—it was a great company—to work in the public sector for a short period of time in the transport sector, not on the railways but in another area. Certainly, one of the concerns we heard very regularly from organisations equivalent to us within the public sector—I was in the freight sector, which was so small that the Treasury did not worry about it—was that investment in the public sector operating companies tended to vary year by year depending on what the Treasury felt was possible in terms of public investment, which completely disrupted a regular, predictable and sensible investment programme in what were effectively commercial public enterprises. I would like to hear from the Minister how there will be effectively that barrier between what the Treasury wants to do year to year and the genuine needs of public sector railway companies to offer a consistent and improving service to the travelling public.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Moylan, for his Amendment 8, which would require public sector operators to publish plans for investment and innovation. I would dispute the proposition that a move to public ownership will produce a decrease in investment. As I have previously said, currently no meaningful private sector investment is being funded by franchising.
Lord Moylan (Con)
I have not said that a move to public operation would reduce investment, nor have I argued it either here or anywhere else. The question put by the amendment is quite different to that.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord for his intervention. I did not say that he had made the assertion; I was disputing the proposition that a move in that way would produce a decrease in investment.
As I said, no meaningful private sector investment is being funded by franchised operators at present, so we are losing nothing by moving to a public ownership model. The Government are already reimbursing the legitimate operating costs of private sector operators and receiving the revenue. Even before the Covid pandemic, the main private investment in our railways was in rolling stock, generally funded by the rolling stock market, not by train operators or their owning groups. Given that the rolling stock market is not impacted by the Bill, there is no reason to see that change.
The Government, of course, wish to see innovation and investment in areas such as those described in the amendment. In fact, the public sector is already demonstrating its commitment to innovation. We have committed to reviewing the overcomplicated fares system, with a view to simplifying it and introducing digital innovations. Change is already being delivered: for example, by the slightly delayed, extended pay-as-you-go in the south-east and fares reform on LNER. Public ownership is essential to progress these fares and ticketing innovations and other reforms. Unlike under franchising, with public ownership we will be able to get these sorts of reforms done without needing a commercial negotiation with up to 14 different operators, each seeking to boost their profit at the taxpayer’s expense in return for agreeing to implement those reforms.
However, the Government do not consider it appropriate to spell out detailed requirements such as these in the legislation. To do so would constrain future flexibility to adapt operators’ obligations to suit changing circumstances. It is not necessarily the case that constant investment and innovation across all these different aspects of the customer offer is the right approach. The focus of innovation should be on those areas where improvement is most needed at any point in time, and not those that are already working well. Moreover, it will not be coherent for passengers, nor efficient for the taxpayer, if up to 14 separate publicly owned operators in England, plus those in Scotland and Wales, are each pursuing their own separate innovation and investment strategies across all these different aspects of the passenger offer.
A key purpose of our wider reforms, starting with the establishment of shadow GBR, will be to drive a much more coherent, cross-industry approach in areas such as those described in the amendment. GBR will be the right body to consider investment across the railways, and I ask noble Lords to wait to consider the Government’s proposals on GBR in the coming months, though I feel very confident that a coherent guiding mind for the railways will produce a longer-term and more consistently argued approach for investment than has been true in the past.
In summary, I support the underlying sentiment that investment and innovation are needed to drive improvements in many aspects of the passenger offer, but the proposed amendment is not the right way to deliver it. I offer my reassurance that investment and innovation are critical to our plans to reform the railways, but I urge the noble Lord to withdraw his amendment.
Lord Teverson (LD)
I asked the Minister to tell me how we can isolate, to some degree, consistent investment decisions in the new railway structure from Treasury decisions that tend to move public investment up and down very regularly—I do not understand how that happens. We are moving from a situation where, if I have got this right, we have, effectively, investment being off-balance sheet through train operating companies and other organisations to on-balance sheet public expenditure. I am still desperate to understand how the new public sector train operating companies can properly rely on consistent investment. I would be interested to hear from the Minister what he expects the average level of investment in railways to be, per annum, over the next five years.
Lord Hendy of Richmond Hill (Lab)
A coherent guiding mind is far more likely to produce a long-term business plan for the railway that justifies future investment than the previous fragmented system. Very few of the owning groups or train operating companies have ever made any significant investment. The principal investment that has been made in passenger services is with the rolling stock companies, whose position is unaltered in the proposition of this Bill.
Lord Moylan (Con)
My Lords, I come away from each of the Minister’s responses slightly more baffled and frustrated than I was before. Let us try and get clear what I think he is saying. This in part is my attempt to frame at least a model answer to the question raised by the noble Lord, Lord Teverson.
At the moment, the Minister would say that there are in principle three sources of investment in the railway. There is what is put in by the private sector—that happens to be a nil set, the number is zero, but in principle it is there. There is what is provided by the private sector for the purpose of acquiring trains for the purpose of leasing them out—that is unaffected by the Bill, so that is not going to change, and nor is there any suggestion, incidentally, although I may be wrong about this, of course, we wait to see, that that is going to change as part of the Great British Railways Bill coming down the track. Then there is the part that is put in directly by the Government and that is currently negotiated by Network Rail in a series of five-year control periods. I forget where we are in the current control period, but we are vaguely half way through a five-year control period.
So, in the future, what is the Minister holding out to us that is going to be different? The contribution from the train operating companies will continue to be zero, because they are now going to be simply shell companies or part of that. He is quite clear we are not losing or gaining anything on that particular front. There will be no change to the way in which the roscos are set up for the purpose of leasing trains. So everything is thrown back on the comparison with the Network Rail negotiations in relation to the current control periods. Somehow, because that is Great British Railways, it is going to be transformed.
We have just heard that it will be longer term, so it will not be a five-year control period, it will be a 10-year control period or a 15-year control period. That might be very desirable—but why? Why is the Treasury going to agree to a 10 or 15-year control period or whatever the number is beyond the five years that exist? And if it is not going to be a larger sum—he did not say a larger sum—it will at least be a more efficiently deployed sum, so that every pound will buy a little bit more than it would have bought under the current arrangement? Again, the question is: why?
The sort of answer we get is, “It is all going to be absolutely wonderful. It will be different and it will be wonderful, but it’s going to be the same and I can’t explain why”. That is where we seem to be left the whole time. Anyway, with that, I beg leave to withdraw my amendment.
Lord Berkeley
“(1D) The relevant franchising authority must ensure that any public service contract awarded under subsection (1A) includes provisions to mandate rest day working.”
Lord Berkeley (Lab)
I rise to move Amendment 11 and to speak to the other two amendments in this group. This is very much a probing amendment to explore where the new railway structure is going to improve waste, delays and costs, which many people have attributed to strikes, go-slows and all the other things that they blame the trade unions for.
I have three examples. The first is to do with rest-day working, which I suffered the other weekend—three trains from Cornwall cancelled in a row. Other noble Lords present tonight have mentioned the cancellations due to rest-day working failures. I will quote from an email from First Great Western in reply to my complaint about sitting around for hours. It says:
“As you will be aware, while all new drivers who have joined the business in recent years have a Sunday commitment, the majority of high-speed drivers still do not. Without a change in terms and conditions we will remain reliant on volunteer overtime to cover Sundays”.
So it looks as though, in 20 years’ time, we will still have the same problem. I ask my noble friend the Minister what the Government intend to do to deal with this and to reach agreement with the trade unions. Of course they need time off—on the other hand, the passengers would like to have a train going at the weekend sometimes.
Lord Young of Cookham (Con)
My Lords, I will speak briefly to Amendment 18 in my name, which proposes the creation of an independent body responsible for pay and terms and conditions of employment for employees of the public companies that are going to be set up under the Bill.
In the long term, I assume that GBR will be responsible for settling these particular issues, but, in the meantime, the question is: who is going to do that? By default, I believe and assume it will be Ministers. That is going to be a real challenge for Ministers, because the department will inherit from the current train operators a whole range of different terms and conditions for their employees, some of them anachronistic. There will then be a difficult process of harmonising all these different terms and conditions into one composite terms and conditions for the new public sector employees that are going to be created. I would have thought that the Government should welcome an independent pay review body to help them through this potential minefield, with the trade unions, understandably, arguing for everybody to be levelled up, with all the implications that will have for current subsidies of the railways.
Also, I think that an independent pay review body which would, of course, receive representations from the Government as to what they thought was affordable, should look at some of the practices that have grown up over the years that might be due for reform: for example, the refusal of trade unions to fit track sensors to trains in order to identify faults in the tracks. That has been held up because there is no agreement.
Likewise, information about changes to speed limits is now put on a board, but it is proposed that it should be put on an iPad; again, there has been resistance to that. Then there is a hangover from the 1980s. As I understand it, an employee who uses a microwave is entitled to paid leave to have a health check.
An independent pay review body could look at some of these practices and see whether they might be modernised. If the alternative is that we should leave all this to Ministers, I am afraid that what happened in the summer does not leave me full of confidence. I am sure that the trade unions, if they had been really pressed, could have set out their new relationship with the new Labour Government by conceding something by way of reform before the near 15% pay settlement. An independent pay review body could look at issues of productivity and management to see if the costs could be managed more effectively.
I turn briefly to Amendment 19, picking up the discussion we had at the end of the last group of amendments about the impact of private investment disappearing, a point raised by the noble Lord, Lord Teverson. As I understand it, the Minister’s reply is basically this: the train operating companies have provided a minimum level of capital investment. I happen to challenge that. The examples I gave—Chiltern opening new railway stations, double-tracking, single-track lines—disprove it; nearly all the investment was self-financed by Chiltern.
Putting that on one side, the Minister’s argument is that the roscos—the rolling stock companies—will continue to buy the rolling stock and, therefore, there is no impact on the public purse. But he has left out a crucial element in the dialogue: the roscos then lease the rolling stock to the train operating companies by way of a franchise. At the moment, the fag end of those franchises, which the department has inherited, score as public expenditure, I believe. That is a liability of a public train operator to discharge the cost of a franchise.
When we move over to the new system, in which all the train operators are run by the Government, surely the franchise costs—the liabilities to pay the rolling stock companies—will score as public expenditure. That was left out of the Minister’s recent exchange. It was also glossed over in the letter that he kindly wrote to us over the weekend. Perhaps he can clarify what the view of the ONS will be on the franchise liabilities of GBR when it takes over the rolling stock from the train operating companies.
Lord Snape (Lab)
My Lords, I express some degree of surprise that my noble friend Lord Berkeley has tabled this amendment. If you make rest-day working in the railway industry mandatory, it ceases to be rest-day working, does it not? The whole purpose of rest-day working is to see that people take a break from their work. While my noble friend outlined the difficulties that have arisen in various parts of the railway system because people have declined to work their rest days, that is not really the fault of the people themselves or their much-maligned trade unions.
The fact is that, particularly since privatisation—although it happened under British Rail as well—railway staffing has been reduced as much as possible. The first thing that Stagecoach did when it took over South West Trains was to make lots of train drivers redundant. Not surprisingly, the ones who were left declined to work their rest days; they declined to work overtime. The number of cancellations in the first two years of Stagecoach’s operation of South West Trains rose accordingly.
I recommend to my noble friend a book called Red for Danger, written by a man called Tom Rolt—LTC Rolt—who sets out railway accidents since the 19th century, many of which were caused by tiredness because of the number of hours worked by drivers and signalmen. I will give one example. In 1892, the Thirsk accident, which killed some 35 people, was caused by a signalman falling asleep. He fell asleep because his infant daughter had been ill, and he had spent two days trying to find a doctor for her, but she had died. He tried to get time off after her death—he was on nights at the time—but the stationmaster refused permission. He had been awake for 46 hours. Two express trains crashed as a result.
Following that tragic accident, in 1906 the House of Commons at least debated the question of railway hours and the fact that many railway workers worked excessively. Perhaps noble Lords will not be surprised to learn that the debate did not spread to this end of the Corridor—obviously, noble Lords at that time had other things on their minds. Coming reasonably up to date, my noble friend Lord Berkeley will remember the Clapham Junction accident in 1988, where a considerable number of people were killed. That was caused by an error by a signal lineman who had worked every single day for the previous three weeks.
Arising from accidents like those, rest days were introduced by the railway industry around the time of the First World War. If train services cannot be maintained at a particular depot without rest-day working, then that depot is undermanned—it is as simple as that. Whether my noble friend the Minister can promise that such circumstances will not happen under Great British Railways is something I will leave with him.
I hope I have made it quite plain that I am not one of those people who thinks that everything about privatisation was wicked, but one of the downsides of privatisation was at least the tendency to run railway operations with a minimum number of people. I hope my noble friend Lord Berkeley will reflect on, understand and accept the fact that rest days are there for a particular purpose, and that he will withdraw his amendment.
Baroness Pidgeon (LD)
My Lords, as Liberal Democrats, we recognise that ultimately passengers do not really care who runs the railways. What they care about, as we have been discussing today, is that the trains run on time and at a fair price. We believe that the railways can offer that reliable, affordable, convenient and clean form of transport. It is very clear from today’s debate that the trains are not currently working properly. The system is a mess and people out there feel they are paying more and more money for an increasingly poor service.
While we support the Government’s desire to reform and improve passenger rail services, we do not think that renationalising passenger railway services will automatically deliver cheaper fares or a better passenger experience. As we have heard in the discussion on this group of amendments this evening, there is a fear that this reorganisation will create uncertainty for the workforce—the noble Lord, Lord Berkeley, has already outlined some serious issues.
We want to ensure that the entirety of the rail industry is focused on improving its performance, bringing down the rates of cancelled trains and improving the experience for the passenger. To achieve this, we need staff who are motivated and feel valued for the role they are playing in people’s lives. It is not clear how staff will feel going through lots of change and TUPE processes, and what this will mean for the services to passengers. I hope the Minister can assure us that there is a workforce plan, and that thought has gone into this important area.
Research by the National Skills Academy for Rail shows that 35% of the UK’s current 17,000 train drivers will leave the sector within the next five years as a result of retirement and the sector’s ageing workforce profile. Given that it takes at least 12 months to train a driver, from recruitment to driving in the roster, how are the Government going to attract new entrants into the railways at a time of change and potentially huge uncertainty? How can we be assured that passengers will not face cancelled trains as a result of fewer drivers in the rail workforce? That was an issue passengers experienced only a few years ago when Govia Thameslink Railway took over the Thameslink, Southern and Great Northern franchise and did not have enough drivers who could fulfil the timetable—we need to make sure that passengers are not going to be affected by this.
As mentioned in the earlier discussion by my noble friend Lady Randerson and the noble Lord, Lord Young, terms and conditions differ so significantly that it will take a long time to regularise them, and at huge cost. That will have an impact on not only the workforce but passengers. We do not want good people to leave the industry at all levels—train crews and staff, maintenance and management. On the contrary, we want good people to stay and be proud of the part they are playing in keeping Britain moving and in being a part of our new railway service. I look forward to reassurance from the Minister on these points to ensure that the workforce and passengers are at the heart of these proposals.
Lord Moylan (Con)
In speaking to these amendments, I say first that I thought the speech just made by the noble Baroness, Lady Pidgeon, was extremely sensible and contained a great deal with which I agree. It asked a series of important questions of the Minister. I have been around just long enough to have realised that getting actual answers to questions in Committee in your Lordships’ House is a pretty remote prospect, but these questions are of such importance that the Minister might make a bit more than the normal effort to address them.
I draw attention to Amendment 49 in my name, which raises the question of minimum service levels, which the last Parliament enacted as means of ensuring continuity of some service on the railways if strike action were to take place. The Government have not said whether they intend to avail themselves of that legislation and in what circumstances, but nor have they said they are going to repeal it. Many passengers in the country at large, looking to this as a means of protecting them from the ravages of what is sometimes thought to be excessive and persistent industrial action, would expect the Government to have a clear view on when they are going to use these measures—or even if the answer to that is “never”. I hope we can get a straight answer from the Minister on that.
I turn to Amendment 18 in the name of my noble friend Lord Young of Cookham, which relates to an independent pay review body. That amendment or something similar was discussed in the other place when the Bill was before that House, and the Minister in fact gave some encouragement, saying that the Government would at least look at it as part of the great reform Bill coming down the tracks towards us. I would like to hear whether government thinking has developed in any way since then and if there is anything the Minister can add to it.
On the face of it, the amendment deals primarily with agreeing and setting, in a semi-binding way, the pay rates and terms and conditions for railway staff analogously to those in other parts of the public sector. After all, it is the Government’s policy that these people should now be public employees. They should come under a single employer, a single brain and a single wallet, so it would be an independent pay review body along those lines. However, my noble friend Lord Young of Cookham took the amendment in another direction as well and made an interesting point, one also made by the noble Baroness, Lady Pidgeon: how are the Government going to amalgamate, smooth out or harmonise the varying terms and conditions and rates of pay that exist among the different train operating companies as currently constituted, as they bring them under this great big umbrella? Is there going to be a levelling up all round?
Will there be a cost to the public purse? The Government have claimed that the Bill involves no cost to the public purse, but it is patent that, if you employ a large number of people and end up adjusting their pay scales on the grounds of equity, and if those pay scales tend on average to be higher than before, a cost has been incurred directly as a result of the Bill and the action being taken under it. How is that cost to be dealt with? Where is it to come from? Why are the Government not being honest about the Bill involving costs of that character? This is a point we will return to, I am sure, when we come to look at other liabilities being transferred to the Government as a result of proposals in the Bill, as we will do later in this Committee. I invite the Government to think about this seriously, because these are important issues and they should be looked carefully.
Finally, and taking account to some extent of the lateness of the hour, when we started debating this group it was my intention to rise to offer some level of support to the amendment tabled by the noble Lord, Lord Berkeley, relating to minimum rest days. But the comprehensive and unremitting demolition of his position advanced by the noble Lord, Lord Snape, was so persuasive and irresistible that I have decided to abandon that effort.
Lord Snape (Lab)
I am grateful to the noble Lord for his kind words. I would just refer him to the proposed new clause to be inserted by the amendment in the name of his noble friend Lord Young, which is headed “Independent body to advise on pay and terms and conditions of employment for employees of public sector companies”. I make it that, during this debate, the party opposite has proposed no fewer than seven different bodies, groups, organisations or committees—call them what you like. As the Opposition rails regularly against too much bureaucracy, I am astonished that they want to create yet another body. In the event of a pay dispute, does the noble Lord not agree that that is why, many years ago, we created the conciliation and arbitration service? Such matters are better referred to it—we are surely running out of lawyers to sit on all these bodies—rather than creating yet another bureaucratic organisation.
Lord Moylan (Con)
In response, I say only that seven would be a fantastically tiny number compared to the number of internal boards, committees, liaison bodies and so forth that Great British Railways is likely to require to explain to itself what it is doing, before it even gets round to explaining to the public what it is up to. I regard seven as a very modest and economical number.
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend Lord Berkeley for his Amendment 11, regarding rest-day working. Rest-day working provides resilience in response to spikes in leave, sickness and training, and it rewards the workforce when extra hours and days are worked. It can offer benefits to rail employees, as well as to passengers. It is likely that it will always be necessary, to some extent, to effectively deliver the timetable. However, rest-day working should be used where there is an operational benefit and employees are willing to volunteer, rather than trying to mandate in legislation how and where it is used. Our focus is instead on ensuring, as soon as possible, that the railway industry has enough staff to operate services reliably for the benefit of passengers and employees, without excessive rest-day working.
My noble friend Lord Berkeley referenced the new trains on South Western Railway. I say to him that they are now entering service and, further, that Network Rail in fact substantially changed terms and conditions two years ago for greater flexibility and in agreement with the workforce, and that is now reflected in greater efficiency. That deal demonstrates what can be achieved in the public sector.
The noble Baroness, Lady Pidgeon, referred to uncertainty. There can be no greater uncertainty than has existed for the last 30 years on the railway, in which anybody of long service has changed their employer at least once, sometimes several times, while doing the same job. The people whom I meet going around the railway talk about it as “the railway”, many of them because their employer has changed so often that they cannot even remember the name of the company that they used to work for. Some stability in respect of the employers of staff on the railway, many of whom are deeply committed and have had long service, is overdue, and this Bill will move towards it.
Will there be a workforce plan? Yes. Is there one at the moment? No. As the train operating companies come into public ownership, they will have to have a workforce plan. Personally, I am absolutely committed to the maximum recruitment of drivers as early as possible, to the benefit of the drivers themselves and the service that the railway operates.
I also very much thank the noble Lord, Lord Young of Cookham, for Amendment 18, which suggests that an independent body should be established to advise the Government on the pay and terms and conditions for railway staff under public ownership. We are committed to delivering the biggest overhaul of our railways in a generation. It is right that, as part of that process, these matters are considered. Employment conditions are an important issue and one that we are determined to get right.
My officials are at the early stages of exploring a number of options, including a pay review body, so that we can consider the most appropriate approach to meet the needs of a transformed industry. A number of different approaches exist across the public sector, including pay review bodies and wider guidance, and, as my noble friend Lord Snape said, the use of the Advisory, Conciliation and Arbitration Service. We need more time to reach an informed conclusion on the best approach for the rail sector. It would be inappropriate to commit to the introduction of an independent body before that work is completed. In particular, we do not need to do this now in relation to this Bill.
Amendment 49 is in the name of the noble Lord, Lord Moylan. It seeks to require the Secretary of State to produce a report on how public ownership will impact the implementation of the Strikes (Minimum Service Levels) Act 2023. The noble Lord must surely be aware, however, that the Government have already committed to repealing the Strikes (Minimum Service Levels) Act 2023. That is because this Government are committed to strengthening the rights of working people by empowering workers to organise collectively through trade unions.
No relevant employer, under the Strikes (Minimum Service Levels: Passenger Railway Services) Regulations, has chosen to implement minimum service levels under this legislation and, in fact, they will not work. Instead, we will work in partnership with trade unions, as we have done in recent weeks to bring an end to two years of disputes that have meant needless disruption and misery for passengers. So I must say to the noble Lord that the Strikes (Minimum Service Levels) Act will not be implemented for publicly owned services, or indeed at all under this Government—as, in fact, it was not under the last one. The suggested report, therefore, would be redundant.
Finally, I will respond to the points made by the noble Lord, Lord Young, on the classification of the costs of rolling stock for publicly owned train operating companies when I respond to Amendment 19 in group 10 in the resumed Committee stage on Wednesday. I note for now that, whatever the position is, it must already apply to the four publicly owned train companies. I urge the noble Lord to withdraw his amendment.
Baroness Randerson (LD)
Before the noble Lord sits down, can I ask a question in reference to the fact that the Minister mentioned that there was no need to sort out terms and conditions now? What timeframe do the Government assume that they must follow in order to ensure that the first train operating companies to be taken into public ownership do so in an organised way so that new staff are recruited with modern terms and conditions of employment.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Baroness, Lady Randerson, for her intervention. In fact, I did not say that there was no need to sort out the terms and conditions now; I said there was no need to sort out the particular matter of how the overall pay and conditions might be dealt with, including with the pay review body. As a matter of fact, the employees would transfer under the transfer of undertakings regulations. At that stage, no change is possible on the transfer. That will need to be resolved and I am sure that changes are in fact needed, if only because, at least in my view, some of the existing train operating companies have failed to develop the terms and conditions in the way that they should have, both to operate a better service and to reward the staff more effectively.
Lord Berkeley (Lab)
My Lords, I am very grateful to all noble Lords who took part in this short debate. My amendment was a probing one, as I said, and I have no regrets about tabling it because we have learned a great deal this evening. It has been easier to blame what has gone wrong in the railways and the strikes in the last few years on the trade unions or even the present Government, but most of the passenger franchises that have been operated in the last 10 or 20 years have had Department for Transport puppet-string holders behind them, telling them what they can and cannot do, which is not the way to negotiate. Most successful negotiations take place on the background of a client, customer or owner who knows what they are doing and has done it before, and trade unions that also know what they are doing.
I am pleased that my noble friend has given us a progress report on where this is likely to go and I thank him for the information and for updating me on some things, but I hope that it will not be too long before we see an even better arrangement for the workforce, whether it is a workforce plan or whatever, including Network Rail workers. Then everybody could get their heads down and get on with providing a good service to the customers—which is, of course, what everybody wants. On that basis, I beg leave to withdraw the amendment.