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Gavin Robinson (Belfast East) (DUP)
Katrina Murray (Cumbernauld and Kirkintilloch) (Lab)
The Secretary of State for Northern Ireland (Hilary Benn)
The Government are working with the Northern Ireland Executive to help to ensure the best outcome for Spirit’s aerospace production and its skilled and hard-working staff in the current commercial negotiations.
Gavin Robinson
It is welcome that the Secretary of State has visited the Spirit AeroSystems site a number of times. He will know of its importance to advanced manufacturing, and of its aeronautical history in Northern Ireland—it originated in 1908 as Short Brothers—and he will also know that at this stage there is a purchaser for about a third of the facility and a third of the staff. The current plan fails to recognise not only the integration of the units within Spirit AeroSystems, but its importance to the Northern Ireland supply chain. Will the Secretary of State join Unite and GMB in their call for the Government to support a one-sale solution, so that the integration of staff, work flows and supply chains continues to benefit for decades to come?
Hilary Benn
I agree with everything the right hon. Gentleman has said about the importance of the site and its history, but in the end there will be a commercial outcome. Airbus wants to buy the bit that makes the A220 wings, because it wants the site to produce more of them, and Boeing is seeking a buyer for the rest of the production. The right hon. Gentleman will be well aware of what else is produced on site. I continue to engage with all those involved, but, as I have said, in the end this will be a commercial decision. We do, of course, want to see the production and the jobs remain.
Gavin Robinson
The Secretary of State will know that the facility would not be there had it not been for Government investment and support. Guarantees were given not just to the people of Belfast, but to the staff directly employed at Spirit AeroSystems. The Government have also engaged in discussions about Harland and Wolff and Navantia, and the fleet solid support ships.
The Secretary of State will share the concern that I felt yesterday about the news that the four Harland and Woolf shipyards across the United Kingdom would be going into administration, and he will know of the countless businesses throughout the UK that are owed tens of millions of pounds in respect of the work on those fleet solid support ships. We want their viability to continue, and we know of individual businesses that have been family-owned for generations and have succeeded. Can the Secretary of State indicate his endeavour to ensure that that viability will be at the forefront of his mind, so that we can deliver the fleet solid support ships in Belfast and Devon?
Hilary Benn
The administration announcement, which involves the other side of the runway, is part of a process to ensure that the takeover by Navantia goes ahead, because it is very good news. The right hon. Gentleman and I were present to celebrate that announcement, which provides security for the future. Ultimately the question of how to relate to those suppliers is a commercial matter for Navantia, but I am sure that it wants to build a good relationship with firms that will help Harland and Wolff to build the three fleet solid support ships.
Katrina Murray
While the contract with Airbus is welcome, there is concern about the split of the Spirit plant in Belfast. Can the Secretary of State reassure me that wider defence and aerospace contracts with companies such as Skyrora in my constituency that are held in Belfast by the non-Airbus part of Spirit will not be put at risk because of that?
Hilary Benn
I understand my hon. Friend’s concern. We will know the answers to these questions when the commercial negotiations are concluded, but I will draw the attention of my right hon. Friend the Secretary of State for Scotland to the specific issue that she has raised in relation to her constituency.
Tonia Antoniazzi (Gower) (Lab)
The Government have a visibly strong relationship with Airbus in respect of its presence in north Wales. What representations is the Secretary of State making to ensure that there is equivalent investment for the Spirit AeroSystems workers in Belfast?
Hilary Benn
The fact that Airbus wants to acquire the A220 wing production and wants more A220 wings to be built in Belfast is, I think, a sign of its willingness to invest and to see that production grow and prosper.
Peter Swallow (Bracknell) (Lab)
The Parliamentary Under-Secretary of State for Northern Ireland (Fleur Anderson)
Public services in Northern Ireland continue to fall behind, and the people of Northern Ireland deserve better. I raise this regularly with Northern Ireland Ministers including the Education and Health Ministers, and the Government are fully committed to helping the Executive to make the urgent reforms that are needed.
Peter Swallow
Integrated education is an essential part of reconciliation, so does the Minister share my disappointment at the Northern Ireland Education Minister’s decision last week to reject the bids by Bangor academy and Rathmore primary to become integrated schools, which had the support of a majority of parents at both schools?
Fleur Anderson
Yes, I do. Integrated education is a devolved matter for the Executive, but this Government are unapologetically supportive of integrated education. I have spoken to the headteachers of Bangor academy and Rathmore primary school this week, and they, as well as parents and pupils at the schools, are shocked by the decision. I hope that the Education Minister will work with them to resolve his concerns and listen to parents, who overwhelmingly want their children to benefit from integrated education.
Robin Swann (South Antrim) (UUP)
The Minister talks of transformation. When the Executive were restored at this time last year, the Government put a pot of £235 million into transformation. A senior Northern Ireland Office official sits on the board. To date, not one penny has been spent on supporting the transformation of either the health service or the education service. Can the Minister update the House on what the hold-up is in regard to spending that money?
Fleur Anderson
I thank the hon. Member for raising the issue of the Public Service Transformation Board. As he says, the interim board has a £235 million budget for transformation. Several major projects—on health, special educational needs and justice—are now being sent to the Northern Ireland Minister of Finance for agreement, and I have pushed for the full board to be set up by the end of this financial year. I agree that it needs to move ahead and get those projects done.
Mike Wood (Kingswinford and South Staffordshire) (Con)
The Executive have warned of very serious pressures facing the NHS in Northern Ireland, which has the worst waiting times in the United Kingdom—more than six years for some surgeries. Labour’s manifesto committed to improving public services in Northern Ireland, and it is clear that money alone is unlikely to solve the problem. What other tangible support will the Government offer the Executive to reduce waiting times for people in Northern Ireland, or will they just devolve and forget?
Fleur Anderson
The hon. Member is correct to raise the issue of public services, especially health services. The winter pressures on hospital care and other areas have been shocking to see, and I am grateful to health workers for their work on the frontline at the moment. This week, I met the UK Government’s Health Minister to talk about how we can provide tangible support, and we have already done so. As the hon. Member says, funding is not the only answer; it is also about sharing best practice and expertise. This Government have committed to doing that through the Public Service Transformation Board, but there are other practical ways in which we can work together on the best ways to reform.
Dr Al Pinkerton (Surrey Heath) (LD)
A&E waiting times in Northern Ireland now exceed 12 hours in some hospitals, patients are being treated in the back of ambulances because of a lack of beds, and Dr Alan Stout, the chair of the British Medical Association’s Northern Ireland council, has told the Northern Ireland Committee today that Northern Ireland is in a particularly bad place when it comes to health services. What conversations have the Secretary of State and Minister had with the Northern Ireland Executive to ensure that they have the resources that they need to cope with this immediate crisis? Are Ministers convinced that the 124% fiscal floor is adequate for addressing this issue in the long term?
Fleur Anderson
I have met the Minister for Health, and I have been round and visited many of the healthcare provision services, all of which are feeling pressures at this time as a result of successive Executives not tackling reform and being absent along the way. That is why we set up the Public Service Transformation Board. The Executive face huge challenges, and this Government’s priority is to work with them. The funding is there, the Executive are committed, and they need to work together to deliver change urgently.
Claire Hanna (Belfast South and Mid Down) (SDLP)
David Smith (North Northumberland) (Lab)
The Secretary of State for Northern Ireland (Hilary Benn)
As I set out on 4 December, the Government have now begun the process of repealing and replacing the Northern Ireland Troubles (Legacy and Reconciliation) Act 2023 through a proposed remedial order, and we will bring forward primary legislation, including to reform the Independent Commission for Reconciliation and Information Recovery. In preparing for that, I will continue to talk to all interested parties.
Claire Hanna
Nobel laureate Seamus Heaney described Sean Brown as a man of “goodwill and integrity” who represented something better than we have grown used to. We meet the day before his family are forced back to court, and in the week of the anniversary of the Kingsmill massacre; the sole survivor, brave Alan Black, is waiting for a long-overdue ombudsman report. Those two incidents were among the most nakedly sectarian in a squalid conflict, but decades on, those in and out of uniform who created victims—rather than the victims themselves, who have lived with the consequences for decades—are still driving the process. Will the Secretary of State commit to ensuring that his forthcoming proposals, which I know he is working on intensively, remove the NIO veto under the guise of national security? Will he commit to root-and-branch reform of ICRIR and to exposing collusive behaviour, and will he hold to the standards agreed by all parties in both Governments at Stormont House?
Hilary Benn
I have met both the Brown family and Alan Black, the sole survivor of the Kingsmill massacre. The trauma they have been through is hard for anyone else to appreciate. We all look forward to the publication of the ombudsman’s report on the Kingsmill massacre. I want to see a full investigation into the murder of Sean Brown, but there is an appeal on wider matters and I cannot comment further. I am committed to fundamental reform of the independent commission.
David Smith
My first full-time job in the early 2000s was setting up and running a peacemaking programme for young people in Northern Ireland, so I am pleased that the Independent Commission for Reconciliation and Information Recovery was salvaged from the remains of the Northern Ireland Troubles (Legacy and Reconciliation) Act 2023. However, I am concerned that in the discussions around legacy the goal of cross-community reconciliation is being treated as secondary to information recovery for individuals, important as that is. How will my right hon. Friend ensure that ICRIR works with key stakeholders to foster cross-community reconciliation in Northern Ireland?
Hilary Benn
My hon. Friend raises a really important point. Enabling families who have suffered for so long and who have not found answers to what happened is a fundamental part of facilitating the process of reconciliation in Northern Ireland. The truth is that we have to work on both aspects.
Sir Julian Smith (Skipton and Ripon) (Con)
The Secretary of State knows that I agree with many aspects of the repeal of the legacy Act, but the Policy Exchange report this week, as the newspapers have reported this morning, raises significant concerns about the repeal of sections 46 and 47. May I urge him to return to the previous cross-party position that we have to block compensation payments to terrorists such as Gerry Adams?
Hilary Benn
I have indeed seen that report. The problem is that the approach set out in the legacy Act has been found, in that respect and many others, to be unlawful. Of course we will continue, as the previous Government did, to see whether we can find a lawful way of dealing with the issue that the right hon. Gentleman has identified. That work will continue.
Mr Gregory Campbell (East Londonderry) (DUP)
Does the Secretary of State agree that the job of the commission in helping people to deal with the past is made much more difficult when we have reprehensible incidents such as Sinn Féin First Minister Michelle O’Neill attending and speaking at a commemoration of three IRA terrorists who died when the bomb they were transporting through County Londonderry in 1971 exploded prematurely, killing them rather than the innocent people they intended to murder, and when we now have the possibility that the former Sinn Féin leader and terrorist Gerry Adams may be about to receive compensation?
Hilary Benn
As I said a moment ago, the process of reconciliation and coming to terms with the past is a difficult and itself a troubled process. Lots of people have been on a journey and we need to continue to see that journey followed. People will express their views about the stance that different people have taken, but since the hon. Gentleman has mentioned the First Minister, I welcome the fact that, for the first time, she attended the Remembrance Sunday commemorations.
Alex Burghart (Brentwood and Ongar) (Con)
I would like to return to the question that has just been raised by the former Secretary of State for Northern Ireland, my right hon. Friend the Member for Skipton and Ripon (Sir Julian Smith). When the previous Government passed their legislation, the Labour party was in favour of the amendments made in another place that ruled out compensation to people such as Gerry Adams and others similarly detained in the 1970s. Why have the Government now changed their position?
Hilary Benn
The courts have found those clauses to be unlawful. The last Government passed legislation to enable terrorists to get immunity. The last Government passed legislation to deny people in Northern Ireland the right to bring civil claims, including against terrorists. The Conservative party has never apologised for doing both of those things. It is about time that it did.
Alex Burghart
Let us return to the matter of Gerry Adams. I am sorry to say that I must correct the Secretary of State. The High Court found that those provisions of the legacy Act were unlawful, but it is well within the Secretary of State’s power to appeal that judgment. He has dropped that appeal. I do not wish to teach the Secretary of State to suck constitutional eggs, but he will know full well that it is also within the sovereign power of this Parliament to give legal basis to the Carltona doctrine, which has been in place since the 1940s. Or would he rather pay compensation to Gerry Adams and people like him?
Hilary Benn
Nobody wants to see that. The Supreme Court judgment that ruled that the interim custody orders following internment were not lawfully put in place, in which the Carltona principle was much discussed, was in 2020. The last Government did nothing about that for three years, until they belatedly accepted an amendment in the House of Lords that has now been found to be unlawful. It is a complex and difficult question—the last Government found it difficult—but we will continue to follow the same path to see whether it is possible to discover a legal means of dealing with the problem that the hon. Gentleman has identified.
Chris Vince (Harlow) (Lab/Co-op)
Alan Gemmell (Central Ayrshire) (Lab)
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
Dan Aldridge (Weston-super-Mare) (Lab)
The Secretary of State for Northern Ireland (Hilary Benn)
The Government’s mission is to encourage growth in Northern Ireland through increased investment, job creation and higher living standards. The Government are working closely with the Northern Ireland Executive to develop Invest 2035, the UK’s modern industrial strategy.
Chris Vince
Northern Ireland’s economy has strong and dynamic sectors, from agrifood to aerospace, and from shipbuilding to cyber-security. Does the Secretary of State agree that Northern Ireland has a vital part to play in the industrial strategy?
Hilary Benn
It certainly does. My hon. Friend alludes to a number of the great strengths of the Northern Ireland economy. The deal with Harland and Wolff, which I mentioned earlier, is another sign of the Government’s commitment. Of course, the Northern Ireland economy has access to both the EU and the UK markets.
Alan Gemmell
Does the Secretary of State share my optimism that UK Government funding for all four of Northern Ireland’s city and growth deals, confirmed in the autumn, provides a great basis for all of Northern Ireland to generate growth and opportunity?
Hilary Benn
I certainly do, and I have been greatly impressed by the commitment of those involved in developing the growth deals to investing in boosting economic growth in their areas.
Jayne Kirkham
Could the Secretary of State update the House on what recent discussions he has had with the Executive about steps to increase revenue, in order to help to deliver longer-term financial sustainability and grow the economy in Northern Ireland?
Hilary Benn
I have had a number of discussions with the Executive on that subject, and I am pleased to see that the draft budget for next year contains a plan to raise further revenue to meet the £113 million requirement that was part of the budget restoration agreement. It is really important that the Executive raise additional funds to meet the challenges of improving public services.
Dan Aldridge
There are many dynamic tech and digital companies at the vanguard of the mission for economic growth in Northern Ireland. Does the Secretary of State agree that these industries are critical to Northern Ireland’s economic future? What steps are the Government taking to support these industries in growing to their full potential?
Hilary Benn
There have already been discussions with businesses in Northern Ireland about the part they can play in the industrial strategy. Cyber-security is a really good example of the huge strength of the Northern Ireland economy; many companies, including from the United States of America, are investing in Northern Ireland because of the skill and expertise to be found.
Sorcha Eastwood (Lagan Valley) (Alliance)
I thank the Secretary of State and the Minister for their responses so far. One response highlighted Northern Ireland as having dual market access. On that basis, do they agree that initiatives such as the Dublin-Belfast economic corridor in my constituency need support so that we can make the most of our economic opportunities?
Hilary Benn
I do indeed think that the Belfast economic corridor is a really good thing. We support it, and I look forward to seeing it develop and succeed.
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
Agriculture is really important to the economy of Northern Ireland. In Scotland, we breed excellent bulls, but it is very hard to sell them and get them into Northern Ireland because of the regulations and red tape, and vice versa for Irish bulls coming to Scotland. Will the Secretary of State see if we can make it easier for farmers on both sides?
Hilary Benn
I will look into the matter that the hon. Gentleman raises and I will come back to him.
Jim Allister (North Antrim) (TUV)
This week, the Prime Minister has spoken of the unbridled economic opportunities from developing artificial intelligence. It is not an unbridled opportunity for Northern Ireland, because instead of living under British regulations on AI, we live under much more restrictive EU regulations. When will the Secretary of State move to release Northern Ireland from the restrictions, under the EU, of foreign jurisdiction?
Hilary Benn
The substantive provisions of the EU AI Act do not currently apply in Northern Ireland, and they would apply only following agreement by the withdrawal agreement joint committee. Any decision would be subject to the democratic safeguard mechanisms in schedule 6B to the Northern Ireland Act 1998.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
In his Union connectivity review, Lord Hendy, now a Minister in the Government, identified that upgrading the A75 would have significant economic benefits, not just for Northern Ireland but for the whole of the United Kingdom. There was another fatal accident on that road in my constituency last week. Will the Secretary of State join the Secretary of State for Scotland in putting pressure on the Scottish Government to finally move on upgrading that vital economic route?
Hilary Benn
It is indeed a vital economic route, and like the hon. Member, I look forward to seeing it improve, not least in the interests of safety, as quickly as possible.
Sammy Wilson (East Antrim) (DUP)
The Parliamentary Under-Secretary of State for Northern Ireland (Fleur Anderson)
The updated EU general product safety regulations largely formalise how businesses already operate in the UK, and the majority of businesses have adapted to continue trading within the UK and with the EU. In December, the Government published guidance for businesses on the application of the regulations in Northern Ireland. The Secretary of State has this week met ministerial colleagues, and will keep this under review.
Sammy Wilson
As a result of those EU regulations, thousands of consumers in Northern Ireland are denied goods from Great Britain, and rather than adapt, businesses in GB have simply abandoned the Northern Ireland market. At the same time, this week, the Department for Environment, Food and Rural Affairs has banned the import of meat from Germany, where there has been a foot and mouth disease outbreak, but has not extended that ban to Northern Ireland because of the Northern Ireland protocol. While the EU protects its market, the UK appears to have abandoned the internal market of its own country. What will the Minister do to redress that?
Fleur Anderson
The Government are absolutely committed to ensuring a smooth flow of goods across the UK internal market. We understand that many companies have adapted easily to GPSR, while for some it is more difficult. The Secretary of State has met the Minister for business this week to discuss further guidance and assurance, and will continue to have such discussions.
Sir Ashley Fox (Bridgwater) (Con)
The Parliamentary Under-Secretary of State for Northern Ireland (Fleur Anderson)
There are many pressures on businesses that we are constantly assessing and talking to businesses about. The hon. Member is right to raise the subject of job creation in Northern Ireland; it is a priority for this Government. We are supporting businesses in many ways, including through Invest Northern Ireland’s fund for small businesses, and by directly supporting jobseekers through our funding for employment support schemes.
Sir Ashley Fox
I am grateful for the warm welcome. How does the Minister expect businesses in Northern Ireland to grow and invest in their communities, given that they have to pay the enormous tax increases imposed by the Chancellor?
Fleur Anderson
Even after accounting for employer national insurance contribution impacts, the Office for Budget Responsibility expects real wages to rise by 3%. Raising the revenue to fill the £22 billion black hole required us to take difficult decisions, but they will result in improved public services, which is good for all people in Northern Ireland.
Chris McDonald (Stockton North) (Lab)
The Secretary of State for Northern Ireland (Hilary Benn)
I welcome the industry-led deal that will see Navantia UK purchase Harland and Wolff’s four shipyards in the UK, including that in Belfast. The Government have worked closely with Navantia UK to secure the future of the yards, the fleet solid support ship programme, and around 1,000 jobs across the UK.
Chris McDonald
Does my right hon. Friend share my optimism that now that the future of the Harland and Wolff yard has been secured, the yard will be able to secure future orders?
Hilary Benn
I certainly do. That is one of the great benefits of the commercial agreement that has been reached with Navantia on buying Harland and Wolff, and the adjustments made to the contract to ensure that the fleet solid support ships could go ahead. This is a great facility, and it is open for business, including for other orders.
Jim Shannon (Strangford) (DUP)
A company in my constituency of Strangford is among those that will suffer because of Harland and Wolff being in administration. This small family firm—I will not put its name in Hansard—will lose half a million pounds. The impact on that company and others is quite catastrophic. What can be done to help those companies that, through Harland and Wolff being in administration, will either not be able to trade, or risk losing out entirely?
Hilary Benn
I recognise the hon. Gentleman’s concerns. This is a product of the failure of the old Harland and Wolff. It now falls to Navantia to decide which of the invoices it wishes to pay, but it will want to secure a relationship with suppliers contributing to the fleet solid support ship programme.
Mr Speaker
Before we come to Prime Minister’s questions, may I welcome the Speaker of the Assembly of the Republic of Albania, Elisa Spiropali, who is in the Public Gallery?
Mr Joshua Reynolds (Maidenhead) (LD)
The Prime Minister (Keir Starmer)
I know that Members across the House will want to extend our thanks to President Biden for his steadfast leadership, and to warmly congratulate President-elect Trump ahead of his inauguration. In my conversation with President-elect Trump, we have underlined our shared commitment to the special relationship in the years to come.
This week, we launched our AI opportunities action plan, which, as part of our plan for change, will ensure that we seize the opportunities of AI to benefit working people. This will boost productivity, transform public services and deliver £39 billion of investment and more than 13,000 jobs.
This morning, I had meetings with ministerial colleagues. In addition to my duties in this House, I shall have further such meetings later today.
Mr Joshua Reynolds
With almost 4.5 million entries and exits over the past year, Maidenhead train station is a busy transport hub, but with crowded gatelines, flooded underpasses and a drop-off facility that is not fit for purpose, the station needs major upgrades to give Maidenhead commuters what they deserve. Does the Prime Minister understand what Maidenhead residents face at the station, and will he commit his Government to fixing these issues in this Parliament?
The Prime Minister
I thank the hon. Member for his question. I am pleased that his constituents are benefiting from upgrades at the station, including, I think, new lifts to make the station fully accessible. The issues that he raises are faced by passengers right across the country. That is why we are bringing rail services back into public ownership, setting up Great British Railways, and making ticketing simpler and fairer to ensure a better service for all passengers, including those in his constituency.
Naushabah Khan (Gillingham and Rainham) (Lab)
The Prime Minister
Skilling up the next generation is vital to kick-start economic growth. Our plan for change will rebuild Britain by delivering 1.5 million new homes. That is why we have established Skills England, and are reforming our planning system and training the workforce. I will ensure that my hon. Friend gets the meeting that she wants with the relevant Minister.
Mrs Kemi Badenoch (North West Essex) (Con)
On Friday, while borrowing costs hit levels not seen since Labour was last in government, I met business owners and their employees in Chesterfield. One of them told me that his business will not exist in four years’ time because of this Government’s policies. It might not even exist next year. The Prime Minister may try to blame his inheritance, or blame global factors, but why should anyone trust a word he says over what businesses are saying again and again—that his Budget means fewer jobs, lower growth and higher borrowing costs?
The Prime Minister
As the Leader of the Opposition knows, the global economy is experiencing volatility and higher borrowing costs. That is why it was vital that we took the tough and right decisions in the Budget to get our finances back in order. We had to deal with the £22 billion black hole that the Conservatives left. We made difficult cuts and raised taxes to invest in health, public services and housing—vital to stability, and vital to growth. We have an iron-clad commitment to our fiscal rules, and she will no doubt welcome the inflation figures this morning.
Contrast that with the Conservatives. They were not brave enough in government to take those difficult decisions. They have opposed all our measures to stabilise the economy and promote growth. They are back to the magic money tree. The Leader of the Opposition wants all the benefits of the Budget but cannot say how she would pay for them. They have not changed; they are still economic vandals and fantasists. Imagine where we would be if they were still in charge.
Mrs Badenoch
Just today, the British Retail Consortium has said that two thirds of businesses will have to raise prices to cope with the Prime Minister’s tax hike. His Chancellor ignored all the warnings and ploughed ahead with an unprecedented borrowing spree, leaving all of us more vulnerable. Now we have businesses saying that they will raise prices to cover his jobs tax. We have an energy policy that will drive up bills, and all the while we are spending more day to day on debt interest than we do on schools and universities. The Prime Minister refused to repeat his Chancellor’s promise that she would not “come back for more”. Will he now rule out any new tax rises this year?
The Prime Minister
We took the right and difficult decisions in the Budget—decisions that the Conservatives did not have the courage to take, which left us in the mess in the first place. When it comes to tax, the Leader of the Opposition knows very well the limits of what I can say from this Dispatch Box, but we have an iron-clad commitment to our fiscal rules. We cannot just tax our way out of the problems that they left us, which is why we have put in place tough—[Interruption.] They were howling at the spending decisions. They would not take them, but we will stick to those spending decisions. Our focus is absolutely on growth, but their record—[Interruption.] They flatlined the economy. Their record is a mini-Budget that crashed the economy, the worst cost of living crisis in living memory, and leaving a £22 billion black hole. I am not taking lessons from them on the economy.
Mrs Badenoch
The Prime Minister knows very well that the Office for Budget Responsibility found no such black hole. He talks about a mini-Budget three years ago. Borrowing costs last week were at a 27-year high for 30-year gilts. The Chancellor is apparently promising to be ruthless in reducing spending. Let me suggest something that he should cut. There is no way that we should be giving up British territory in Chagos. He is rushing a deal that will be disastrous and that will land taxpayers with a multibillion-pound bill. Why does the Prime Minister think that British people should pay to surrender something that is already ours?
The Prime Minister
We inherited a situation where the long-term operation of a vital military base was under threat because of legal challenges. The negotiations were started under the last Government. The then Foreign Secretary came to this House to say why he was starting negotiations and what he wanted to achieve. He said that the aim was to
“ensure the continued effective operation”—[Official Report, 13 December 2022; Vol. 724, c. 865.]
of the base. That is precisely what this deal has delivered.
Mrs Badenoch
There is no one the Prime Minister can blame for this dud deal except himself. At the Budget, Labour was congratulating itself for having the first female Chancellor, instead of ensuring that the country had someone actually qualified to do the job. [Interruption.]
Mrs Badenoch
The Prime Minister claims he has full confidence in the Chancellor, but the markets clearly do not. Yesterday, the Chancellor repeated her promise to have “just one Budget per year” to provide businesses with certainty. The talk in the City is that she cannot meet her fiscal rules, and that there will need to be an emergency Budget. Does the Prime Minister stand by the Chancellor’s commitment that there will be only one Budget this year?
The Prime Minister
The Leader of the Opposition will be pleased to know that the Chancellor will be in place for many, many years to come. She will outstrip them. If we all thought that politics was about cheap points, I could criticise their Chancellors, but I do not have enough time to go through all the Chancellors they had. We have one Budget; that is what we are committed to. We have strong fiscal rules, and we will stick to them, unlike the Conservatives.
Mrs Badenoch
At a time of turmoil in the markets, the Prime Minister was distracted by the crisis around the former City Minister, the hon. Member for Hampstead and Highgate (Tulip Siddiq). What does it tell us about his judgment that yesterday he said he was saddened that his close friend had resigned? This was an anti-corruption Minister under criminal investigation for corruption. Muhammad Yunus, the Nobel prize winner advising Bangladesh, said that London properties gifted to the former City Minister may be the proceeds of robbery. Will the Prime Minister offer Bangladesh the full support of our National Crime Agency in ensuring that any properties bought with stolen funds are properly investigated?
The Prime Minister
The former City Minister referred herself to the independent adviser. He found, as the Leader of the Opposition well knows, that there was no breach of the code. She knows that he found there was no wrongdoing, and the former Minister fully co-operated. She referred herself a week ago on Monday; I got the report yesterday; and she resigned yesterday afternoon. Compare that with the shadow Foreign Secretary, the right hon. Member for Witham (Priti Patel), who breached the ministerial code. The Leader of the Opposition’s predecessor but two ignored it. It was the adviser who then had to resign because he was not taken seriously, and the right hon. Member is now serving the Leader of the Opposition. What a contrast. Thank God the British public chucked them out.
Mrs Badenoch
The Prime Minister did not answer the question about the National Crime Agency—no answer on investigating dodgy Labour Ministers, just as last week he did not want an inquiry that might expose dodgy Labour councils. He knowingly appointed a convicted fraudster as his Transport Secretary. The anti-corruption Minister who he had full confidence in only days ago resigned yesterday in disgrace. He is negotiating a secret deal to surrender British territory, and taxpayers in this country will pay for the humiliation. Now it turns out that his Government may write a cheque to compensate Gerry Adams. That is shameful.
We left the Prime Minister the fastest growing economy in the G7. In just six months under his leadership, it has been taxes up, borrowing up, and mortgage rates up—and that is not all: business confidence is down, jobs are down, and growth is down. Can the country afford four more years of his terrible judgment?
The Prime Minister
Among that barrage of complete nonsense, there is one point that I need to address: the Northern Ireland Troubles (Legacy and Reconciliation) Act 2023, which will have been of real interest across the House. That Act was unfit, not least because it gave immunity to hundreds of terrorists and was not supported by victims in Northern Ireland—nor, I believe, by any of the political parties in Northern Ireland. The Court found it unlawful. We will put in place—[Interruption.] This is a serious point. We will put in place a better framework. We are working on a draft remedial order and replacement legislation, and we will look at every conceivable way to prevent these types of cases from claiming damages—it is important that I say that on the record.
As for the Leader of the Opposition’s claim and her nonsense, the Conservatives crashed the economy. I got a letter this week from a Tory voter in a Labour seat. I hope that they do not mind me saying who it was—it was Liz Truss. It was not written in green ink, but it might as well have been. She was complaining that saying she had crashed the economy was damaging her reputation. It was actually crashing the economy that damaged her reputation. What have we heard? All the Tories have is complaining. They have no defence for their sorry record—they do not even acknowledge it. They have no ideas, no policies. They are like a blank piece of paper, blowing hopelessly in the wind. No wonder the country put them in the bin.
Jim Dickson (Dartford) (Lab)
The Prime Minister
I thank my hon. Friend for raising that matter and I am deeply sorry for those receiving inadequate care in his constituency. The previous Government left the NHS in a critical condition. We cannot deliver growth with record waiting lists and 2.8 million economically inactive people. Through our plan for change we will invest in NHS diagnostic centres. I will, of course, consider his invitation.
Ed Davey (Kingston and Surbiton) (LD)
May I echo the words of the Prime Minister about President Biden? I hope that his team and the team of President-elect Trump can work together to bring the peace in Gaza that we so desperately need so that the hostages can be released, we can get aid in, and the killing can stop.
As the hon. Member for Dartford (Jim Dickson) just said, patients are suffering through the worst NHS winter crisis on record. Last month alone, 54,000 people waited more than 12 hours in A&E. Over 63,000 were stuck in ambulances for over an hour before they could even get into hospital. There is no doubt that the flu season has made the winter crisis worse, but we see these winter crises year after year, following years of neglect of the NHS by the Conservatives. NHS leaders say that we will never put an end to these winter crises unless we fix the crisis in social care. I asked the Prime Minister this question last week, and I was disappointed by his reply, so I will try again. Will he scrap the three-year timetable that he has given the Casey commission so that we can fix social care this year, implementing reforms by the end of this year at the latest?
The Prime Minister
We are encouraged by the talks towards a ceasefire. I think the whole House would urge all to come to an agreement and have the hostages released. We all understand the absolute torture that their families are going through every single minute of every single day that this continues. We hope that there can be progress there.
In relation to the NHS, the right hon. Gentleman is absolutely right: the Conservative party left it on its knees—[Interruption.] There is no point groaning. It is absolutely disgraceful that the NHS was left in the state that it was—absolutely disgraceful. We are investing to turn that around; we are reforming to turn that around. We are, within that reform, dealing with social care. I set out the timetable to him last week and he knows how it is set out.
Ed Davey
I continue to be disappointed by the Prime Minister’s position on social care, and I am going to keep coming back to this issue, because unless we fix it, we will not fix the NHS.
Turning to the economy, though, I have an idea for the Chancellor to grow the economy. As President-elect Trump prepares to take office next week, there are reports that a number of wealthy, high-skilled Americans are looking to come to the UK for fear of what he will do to their country. However, because the Conservatives so broke the immigration system, many of them are finding that there is no visa they can apply for. I know that the Prime Minister is rightly seeking to reduce immigration from the record highs of the Conservatives, but does he agree that if people like this want to come to our country—to bring their money and their skills, so that we can grow our economy and pay for our public services—they should be able to?
The Prime Minister
We welcome all investment into the United Kingdom. I am very pleased to have had record investment in the time we have been in office, and continue to welcome investors and investment to this country. The right hon. Member is absolutely right that the last Government lost control of immigration, as they lost control of health, the economy, the borders and everything else. Of course, it was the Leader of the Opposition who was championing the driving up of the numbers. We will bring those numbers down, get immigration back under control and encourage investment.
Kirsteen Sullivan (Bathgate and Linlithgow) (Lab/Co-op)
The Prime Minister
I thank my hon. Friend for raising that issue, which shows the state of public services under the SNP. If you can believe it, Mr Speaker, a third of Scots struggle to access dentistry, and a quarter of Scottish children start primary school with tooth decay—that is really shocking. Clearly, there is much more that the SNP should be doing. [Interruption.] The SNP should be ashamed. When a quarter of children are starting school with tooth decay, that is nothing to crow about; it is something to be ashamed of. Here, we are delivering an additional 700,000 appointments and reforming the contract, and of course we will work with the Scottish Government to improve the health of children in Scotland.
Jim Allister (North Antrim) (TUV)
Given President Trump’s antipathy to the EU, how does the Prime Minister hope to obtain a trade deal for the whole United Kingdom in circumstances where the trade laws affecting part of the United Kingdom—namely Northern Ireland—are the EU’s trade laws, and where the laws governing goods and standards for what can be imported are EU laws? In those circumstances, how can a deal be obtained for the whole United Kingdom, or is the Prime Minister only interested in a deal that would apply to GB, thereby further ostracising Northern Ireland from the Union?
The Prime Minister
The hon. and learned Member knows that controls apply only to EU goods moving into Great Britain. The overwhelming majority of goods moving between Northern Ireland and Great Britain will continue to enjoy unfettered access to Great Britain indefinitely. The hon. and learned Member has made much of mutual enforcement; the reality is that this is mutual agreement. I know that he has his proposal, but I think his proposal would lead in the end to a hard border—something that has been rejected across this House on many, many occasions, and for good reason.
Brian Leishman (Alloa and Grangemouth) (Lab)
The Prime Minister
This is a really important point, because before July there was no plan at all to support the workers at Grangemouth. Within weeks, and importantly, we announced £100 million for a growth deal, and we are jointly funding Project Willow to find a viable long-term future. It is a really serious point, I take it very seriously and we will do everything we can to make sure that viable long-term future is there for the workers, their communities and all who rely on it.
Dr Danny Chambers (Winchester) (LD)
The Prime Minister
I thank the hon. Member for raising this, and he knows our support for Ukraine is ironclad. We are funding NHS doctors and nurses to work closely with their Ukrainian counterparts to share best practice, including how to prevent the spread of infections and AMR. Through the World Health Organisation, we are also strengthening Ukraine’s health system to provide better care, and we will continue to do so.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
The Prime Minister
I thank my hon. Friend for raising this. I believe everyone is entitled to fair, flexible and secure working. That is why we introduced our Employment Rights Bill, which is the biggest upgrade to workers’ rights in a generation. It includes measures that will end the scandal of fire and rehire, prevent exploitative zero-hour contracts and introduce basic rights for more workers from day one—secure wages, secure jobs and ensuring workers have the rights that they deserve at work.
Mr Peter Bedford (Mid Leicestershire) (Con)
The Prime Minister
The advantage, I suppose, of the Leader of the Opposition having no policies is that Opposition Members can say completely contradictory things without breaching their policy. They want the benefits of the Budget, but none of the tough measures to support the Budget. We have taken the decision in relation to pension credit and pension allowances, but because of our commitment to the triple lock, there will be an upgrade in April of this year of £460 for everyone. What I notice is that before Christmas, the shadow Chancellor said that the triple lock is “unsustainable”—unsustainable—so that is their position. Pensions are going up under this Government because we are committing to the triple lock; the triple lock being unsustainable is their argument.
Joe Morris (Hexham) (Lab)
Later this month, my constituency will mark the anniversary of the tragic murder of Holly Newton. Will the Prime Minister and the Home Secretary look urgently at the calls from Holly’s mother Micala Trussler to lower the age at which a person can be recognised as a victim of domestic abuse?
The Prime Minister
I thank my hon. Friend for raising that tragic case; it is a really important issue. We have seen an increase in violence in teenage relationships in the last decade, and I have been continually shocked by research that shows there is abuse in relationships at a younger and younger age. We do need to look at the earliest opportunity at how we properly protect girls.
Ben Obese-Jecty (Huntingdon) (Con)
Rachael Maskell (York Central) (Lab/ Co-op)
The Prime Minister
Tourism is vital to our economy, particularly in cities like York. Places can already choose to introduce a voluntary levy on overnight stays. Our focus is on supporting industry, including by providing a 40% relief for retail, hospitality and leisure properties and permanently lowering their rates from next April.
Matt Vickers (Stockton West) (Con)
The Prime Minister
I am sure that Margaret would be pleased to see the incredible investment going into the area and the 4,000 jobs that are growing the economy. The state of our local councils was left completely damaged by the last Government. She knows that, and everybody knows that.
Grahame Morris (Easington) (Lab)
The Prime Minister
I thank my hon. Friend for his dedicated campaigning on this issue. I am proud that the Government have overturned a historic injustice, boosting the pensions of over 100,000 former mineworkers. We are working closely with the coal staff scheme trustees to consider the proposal, and I will ensure that the Industry Minister keeps him fully updated.
Joe Robertson (Isle of Wight East) (Con)
The Prime Minister
The hon. Member is right that the ferry services for his constituents have simply not been good enough. I know that both he and my hon. Friend the Member for Isle of Wight West (Mr Quigley) share a commitment to ensuring that their constituents receive a better service. The Maritime Minister, my hon. Friend the Member for Wythenshawe and Sale East (Mike Kane), has met the ferry and hovercraft operators, the leader of the council and other stakeholders. There will be further meetings, and I will ensure that the hon. Member is fully informed by the Minister on progress on this issue for his constituents.
Patricia Ferguson (Glasgow West) (Lab)
This year marks the 850th anniversary of my home city of Glasgow. One of the key aims of the celebration is to speed up ambitions around the city council’s grand challenge of tackling poverty and inequality and increasing prosperity and opportunity—themes that chime clearly with this Government’s agenda. Will the Prime Minister join me in congratulating Glasgow on this milestone, and does he agree that people make Glasgow?
The Prime Minister
I thank my hon. Friend for raising this issue. Glasgow is a great city, and I am very happy to join her in congratulating the people of Glasgow on the 850th anniversary. They have made, and will continue to make, a huge contribution to this country.
Jack Rankin (Windsor) (Con)
The Prime Minister
I thank the hon. Gentleman for raising this case. It is appalling that Hamas continue to detain Avinatan and other hostages, including Emily Damari. I know that the hon. Gentleman has spent time with the families—it is nothing short of torture what they are going through. We will do absolutely everything in our power to ensure that we make progress to bring these hostages home—I am sure that I speak for everybody in the House. We will do everything to try to make sure that we get those hostages home.
Mr Jonathan Brash (Hartlepool) (Lab)
My constituent Richard Lee has waited over 43 years for answers about the disappearance of his daughter Katrice from a military base in Germany in 1981. She was just two years old. The Royal Military Police, the Ministry of Defence and successive Governments have failed to get the answers that he deserves, throwing up barrier after barrier to justice. Will the Prime Minister meet Richard and me to finally give this Hartlepool veteran a way forward to uncover the truth about the disappearance of his daughter?
The Prime Minister
I thank my hon. Friend for raising this deeply distressing case. Our thoughts and sympathies are with Richard Lee and his family. The Defence Serious Crime Unit continues to appeal for new evidence in this case, and I will make sure that he has a meeting with the appropriate Minister to discuss progress.
Foot and Mouth Disease
(3 days, 7 hours ago)
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Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
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Dr Neil Hudson (Epping Forest) (Con)
(Urgent Question): To ask the Secretary of State for Environment, Food and Rural Affairs if he will make a statement on the Government’s emergency contingency response to the recent confirmation of foot and mouth disease in Germany?
The Minister for Food Security and Rural Affairs (Daniel Zeichner)
The whole House will be aware of the concern across rural communities about the potential threat of foot and mouth disease. It is a severe, highly contagious viral disease of livestock that can have a significant economic impact, and a truly devastating effect on farming and rural communities when outbreaks occur, as we know from history.
I assure the House that the UK is currently free of foot and mouth disease, and has been since 2007. But following confirmation on 10 January, foot and mouth disease in the German state of Brandenburg, the Department for Environment, Food and Rural Affairs has taken rapid action to protect the UK, including suspending the commercial import of susceptible animals from Germany and restricting personal imports of animal products from across the European Union.
I assure the House that the Government will do whatever it takes to protect our nation’s farmers from the risk posed by foot and mouth. We have increased risk levels in the UK to medium. Last night, the chief veterinary officer and I spoke directly with the German Federal Minister and his officials. The Government have taken decisive and immediate action. The import of cattle, pigs and sheep from Germany has been stopped to protect farmers and their livelihoods. We will not hesitate to add additional countries to the list if the disease spreads. I can inform the House that this morning the chief veterinary officer has confirmed that while Germany’s surveillance continues to be ongoing, it has not as yet detected any further cases.
Foot and mouth disease guidance is available on gov.uk and livestock farmers are urged to be extra-vigilant and report any suspect disease to the Animal and Plant Health Agency immediately. The UK chief veterinary officer is also urging livestock keepers to remain vigilant to the clinical signs of FMD. I reiterate that there are no cases in the UK currently. I also reassure the House that FMD poses no risk to human or food safety but it is a highly contagious viral disease in cattle, sheep, pigs and other cloven-hoofed animals. Livestock keepers should therefore be absolutely rigorous about their biosecurity.
The Government are absolutely focused on responding to the animal disease threats we face, protecting animal health and welfare. Upholding high biosecurity standards is paramount for protecting and promoting food production and food safety, both animal and human, and supporting our economy and trade. That is why we have invested a further £200 million in the UK’s main research laboratory testing facilities at Weybridge to bolster protection against animal disease.
While we stand ready to protect our livestock from the threat of foot and mouth and other exotic diseases, we also offer our support to our European neighbours as they face this threat to their livestock, farming and rural communities. I can assure the House that the Government will be decisive and take the necessary action to protect our farmers from foot and mouth disease.
Dr Hudson
Thank you for granting this urgent question, Mr Speaker. I declare a strong personal and professional interest. As a veterinary surgeon I supervised some of the animal culls in the 2001 outbreak, witnessing sights I never want to see again.
The confirmation on 10 January of foot and mouth disease in Germany, with subsequent slaughter and movement restrictions, is sending shockwaves around Europe and the UK. We have requested this urgent question as no statement was provided to the House on Monday or Tuesday. The shadow DEFRA Secretary, my right hon. Friend the Member for Louth and Horncastle (Victoria Atkins), is unable to be with us today as she is at the LAMMA show in Birmingham speaking to agricultural manufacturers and farmers.
In 2001, the foot and mouth outbreak resulted in more than 6 million animals being culled and cost £12.8 billion in today’s prices. It devastated the farming community, and farmers want reassurance that action is been taken to protect our borders, their livestock and their livelihoods.
The mental health impacts of foot and mouth cannot be overstated. Can the Minister reassure us that the announced movement restrictions are fully in place for animals and products coming to the UK from the affected area? Will the Government think about extending the ban to personal imports of meat and milk products unless accompanied by veterinary documentation? Can the Minister update us on the work tracing possible movements of products from Germany? What advice is there about movements of people and vehicles from the area in terms of fomite transmission of the virus? And, heaven forbid, if foot and mouth ever enters the United Kingdom, what is the situation regarding vaccine supply and potential deployment?
Finally, I pay tribute to the chief vets and the veterinary and animal officers and scientists and officials at the Animal and Plant Health Agency, who do so much to keep our country biosecure. This foot and mouth disease wake-up call is yet more evidence that the Government must now commit to fully fund the redevelopment of the APHA HQ in Weybridge. I urge the Government from the bottom of my heart to fully fund that redevelopment, to make sure that the burning pyres of slaughtered animals, as well as the economic and mental health devastation of foot and mouth disease, remain resolutely confined to the history books.
Daniel Zeichner
I fully appreciate the expertise and passion the hon. Gentleman brings to this subject; he knows of what he speaks. I hope I made it clear in my initial reply just how seriously the Government take these issues. I spoke to him earlier this morning ahead of a Delegated Legislation Committee to make it clear that we would work on a cross-party basis to tackle this, should it come to our shores.
I will try to address the hon. Member’s questions, particularly those around vaccination, because that is always raised and is always of concern.
We are absolutely ready in case that is a control that we need to implement. According to the general advice with regard to control measures, if an outbreak were to occur in the UK, vaccination is a control option that would be considered by DEFRA and devolved Administrations at the outset, in addition to culling and immediate movement controls. I can assure the shadow Minister that the UK vaccine bank holds vaccines for a range of foot and mouth disease serotypes. I can also assure him that there is good, close working with the devolved Administrations on this matter and that we are working in harmony.
On the movement of personally carried goods, I remind the shadow Minister that this Government strengthened those controls at the borders. I am confident that we are doing everything possible at the moment to ensure that we are following the right procedures, given the risk assessments that have been carried out. Our sincere hope is obviously that this does not extend beyond the Brandenburg area, but we are absolutely ready to deal with those issues.
On the investment at Weybridge, as I have said, we have committed an initial £200 million. This is a debate we have been having for some time, and I am afraid that we are working with the resources we have now. However, I am confident that we have a very good set of procedures in place to tackle any potential incursion.
Ms Julie Minns (Carlisle) (Lab)
I thank the hon. Member for Epping Forest (Dr Hudson) for his concern and passion on this subject. Like him, I know only too well the devastation that was caused in 2001. Of course, he previously had the privilege of representing a large part of what is now the Carlisle constituency.
Cumbria was the worst affected part of the country in 2001, with 30% of the culled cattle being from Cumbrian farms. Will the Minister elaborate on the steps that are being taken to ensure that our farmers and their livestock are protected ahead—God forbid—of any potential outbreak?
Daniel Zeichner
I thank my hon. Friend for her question and for the concern she has rightly shown. As I said at the outset, we are well aware of the concern that people feel. However, they should be reassured that we have very good tracing facilities these days; the technologies have improved. What is particularly important is that we are in close contact with our German colleagues, who are sharing advice regularly. Everything that can be done is being done, but I absolutely recognise people’s concerns.
Tim Farron (Westmorland and Lonsdale) (LD)
I confess that all of us in Westmorland and across rural Britain feel a sense of terror at this news, as we recall the devastation and horror of the 2001 outbreak. I will never forget the looming sense of dread and threat as the disease got closer to our farms, or the dread when the disease was diagnosed and whole herds and flocks were slaughtered by those who had cared for them; nor will I forget the burning fires on the hillsides of the bodies of slaughtered animals, or the deep trauma that affected all our communities, but especially our children. We must do everything to avoid a repeat.
Can the Minister explain why this outbreak was notified on Friday, yet DEFRA issued instructions to prevent imports from the affected areas only yesterday, when countries such as Mexico and South Korea were able to act over the weekend? Does he now acknowledge the urgent need to invest in the APHA and the new laboratory, and undo the delay of the previous Government? Does he accept that the failure of the previous Government—and, so far, of his Government—to sign a veterinary and phytosanitary agreement with the EU increases the risks to biosecurity and to British farmers, and will he act swiftly to put that right? Finally, will he meet urgently the noble Lord Curry, who headed the inquiry after the 2001 outbreak, so that we are ready and have learned all the lessons of previous failures, and so that our farms, rural communities and animal welfare are protected at all costs?
Mr Speaker
Order. This matter is very important. My area had the first case of foot and mouth detected in that year, so I know all about it. However, we must stick to the times that have been allocated.
Daniel Zeichner
I am always happy to speak to Lord Curry, who brings huge expertise and knowledge.
I will just say to the hon. Gentleman that there was no delay—essentially, as soon as we were informed, we put the appropriate processes in place, and staff at border control points were issued instructions to hold goods at the border. Everything was done as quickly as possible.
I hear the hon. Gentleman’s point about our relationship with the German Government. I know the German Minister personally, and I spoke to him yesterday. I can assure the hon. Gentleman that we are getting every co-operation needed from the German Government.
Lizzi Collinge (Morecambe and Lunesdale) (Lab)
In 2001, I lived in north Cumbria and I will never, ever forget the sight of burning livestock in my friends’ fields. Can the Minister assure me that my farmers in Morecambe and Lunesdale, who by and large are livestock farmers, will never have to face that terrible scene again and that we will do everything we possibly can to ensure that foot and mouth does not spread to our country?
Daniel Zeichner
I am grateful to my hon. Friend for her comments and for her account of the effect the disease had on her constituents. The purpose of my response to the question today is to give reassurance to people that we have very, very high quality officials working very, very hard to make sure we do everything we can to prevent such an outbreak happening again.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
As well as noting my own entry in the Register of Members’ Financial Interests, I should tell the House that my wife is a practising veterinary surgeon who is occasionally contracted to provide local veterinary official services to the APHA.
I, too, remember the events of 2001 and I remember, having just been elected, the debates we had in this House. We said that we must always learn the lessons and never forget, but in truth, frankly, we have. The extent to which we are exposed today is something for which responsibility is shared across the parties. The state of the APHA headquarters in Weybridge is a disgrace and it is now an urgent disgrace. Hopefully, this is a bullet that we will dodge, but if we do, we know there is also the risk of African swine fever, bluetongue and avian influenza all coming. Is this the point where, across the House, we can all agree on the importance of biosecurity and the importance of funding it?
Daniel Zeichner
I thank the Chair of the Select Committee for his point. I think we all know how important biosecurity is, and that is why the Government committed a further £200 million for that very important facility in Weybridge.
Mr Richard Quigley (Isle of Wight West) (Lab)
Will the Minister confirm what mitigation funding has been made available for farms that may be affected? Will he commit to look urgently at the provision of an abattoir on the Isle of Wight, because we do not currently have one?
Daniel Zeichner
I thank my hon. Friend for his question—good try. At the moment, we are talking about an outbreak in Germany. Should there be—obviously, we are doing everything we can to prevent it—an outbreak in the UK, we will come back with further proposals, but at the moment we are working hard to make sure that that does not happen.
Simon Hoare (North Dorset) (Con)
Could the Minister confirm, given the seriousness of the issues, that when in doubt the precautionary principle will come to the fore, there will be urgency and the proper decisions will be taken? He mentioned working with the devolved Administrations. Given the shared land border on the island of Ireland and the trade there, can he confirm what conversations he has had or may be planning to have with the Government in Dublin?
Daniel Zeichner
The hon. Gentleman is absolutely right. We will, of course, take every precaution and apply the precautionary principle. We treat Northern Ireland in the same way as the other devolved Administrations. The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Coventry East (Mary Creagh) will be having conversations later today.
Alison Hume (Scarborough and Whitby) (Lab)
I welcome the urgent question, as the news is a worry to farmers in my constituency. Is the Minister able to share with the House more details about the funding available from his Department to help prevent new animal diseases?
Daniel Zeichner
I thank my hon. Friend for her point and her concern. We have an extensive set of facilities and agencies who are tasked with protecting our country on these issues. I have every confidence in the chief veterinary officer and her officials in the APHA, subject to the issues that have been raised around long-term funding. We have good protections in place and people should have confidence in them.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
Yet again, we rely on the fantastic people at the Animal and Plant Health Agency, which is based in New Haw in my constituency, despite its slightly confusing name. Will the Minister join me in thanking the people who work there, and does he agree that it urgently needs investment to improve the facilities? I do not think he has visited the APHA. Will he join me on a tour as soon as we can arrange it to see for himself the state it is in and what improvements are urgently needed?
Daniel Zeichner
I am always grateful for invitations from hon. Members and feel that I am permanently on tour, but the hon. Gentleman is right that I have not yet had the opportunity to visit, although the Secretary of State has. Last week, when I was at a conference in York, very senior officials from the APHA gave me a very detailed briefing on the work they do. I share in the thanks to those people who play a huge role in keeping our country safe.
Louise Jones (North East Derbyshire) (Lab)
As a child, I distinctly remember the creeping fear on my family’s farms as foot and mouth moved ever closer. I realised that even as a child, and I feel sick just thinking that we could ever go back there. Many farmers in my constituency have repeatedly raised their concerns over infectious diseases entering the UK. Please can the Minister assure me, and them, that we are doing everything to take this very seriously, and that we have contingency plans in place?
Daniel Zeichner
I am grateful to my hon. Friend for reflecting on the awful experiences of 20 years ago. I assure her that we have excellent people, to whom I have just referred, who are working extremely hard to minimise the risk of any further outbreak. We are doing everything we can to prevent that from happening.
Carla Lockhart (Upper Bann) (DUP)
Does the Minister not agree that it is preposterous that Northern Ireland has been excluded from the UK ban on imports from Germany because of the outbreak of foot and mouth? Does he agree that that is the tip of the iceberg in respect of the impact the Windsor framework and the protocol continue to have on our agrifood industry in Northern Ireland? Since he thinks—and rightly so—that it is essential to protect GB farms from potentially devastating impacts, why does he believe that Northern Ireland farms are not as important?
Daniel Zeichner
Northern Ireland farms are just as important. In Northern Ireland, the controls will apply to meat and live animals moving from a 3 km protection zone and a 10 km surveillance zone surrounding the affected premises in Germany. Those products cannot be moved to Northern Ireland.
Sally Jameson (Doncaster Central) (Lab/Co-op)
Will the Minister outline what measures are being taken to ensure that no animals infected in the outbreak in Germany end up in this country?
Daniel Zeichner
This is an unusual outbreak, in a sense. It is a very small herd of 20 water buffalo. What is unknown to the German authorities at the moment is how they got infected in the first place. Extensive work is going on in Germany to try to understand that. The difference from 20 years ago is that we now have much better science to be able to trace where it may have come from. Extensive work is going on across Europe, because it is a threat to the entire continent. I can assure my hon. Friend that every avenue is being explored to try to make sure that we understand how this has happened and that it goes no further.
Sarah Dyke (Glastonbury and Somerton) (LD)
As a farmer’s daughter, I fully remember the sickening impact of the last foot and mouth outbreaks across Somerset and Dorset, particularly on farmers’ mental health. The culling restrictions resulted in 73% of farmers experiencing depression and anxiety following the last outbreak. Now, almost one half of the farming community are already experiencing anxiety. What plans do the Government have to support farmers who may be impacted by this disease or any other biosecurity risk?
Daniel Zeichner
I thank the hon. Lady for her question. I know she takes these issues very seriously and we have discussed them before. Let me be clear: this is an outbreak in Germany at the moment. We are doing everything we can to ensure it does not extend into our country. Of course people are concerned and worried. Should it develop further, which we are absolutely determined to make sure does not happen, then we will look at further measures to help and support people, but we are not at that stage.
Claire Hughes (Bangor Aberconwy) (Lab)
I thank the Minister for his responses. It is very reassuring that the seriousness of the situation is felt across the House and across the country. He talked about working with the devolved Administrations. Will he say more about how he will work with the Welsh Government in particular to address this issue?
Daniel Zeichner
I can assure my hon. Friend that we have an extremely close relationship with the Welsh Government. The Rural Affairs Minister, Huw Irranca-Davies, and I speak frequently—indeed, we spoke to each other only a few days ago, at the Oxford farming conference—and we are in regular contact to discuss issues such as these. In anything that we do, we will be working together on an “entire United Kingdom” basis.
John Cooper (Dumfries and Galloway) (Con)
With some of the most productive grassland in the UK, Dumfries and Galloway is not worried but terrified by this outbreak. I am reassured to know that we are doing what we can, but it is a very difficult problem to solve. Can the Minister reassure me that the Republic of Ireland will not be the unlocked back door through which this dread disease returns to this country?
Daniel Zeichner
I welcome the hon. Gentleman’s appreciation of the complexities that we face, but it is in everyone’s interests to ensure that we stop this, and we are all co-operating closely. The veterinary officials have a very good network, and they are working closely together. No one wants this to extend further.
James Naish (Rushcliffe) (Lab)
As the son of a farmer, I remember only too well waking up in the early morning and going downstairs to listen to Radio 4 in silence with my family as we heard about more and more animals being culled during the crisis in the early 2000s. What steps are being taken to engage the National Farmers Union and other trade bodies to prepare for any outbreak here in the UK?
Daniel Zeichner
I thank my hon. Friend for his concern and his recollections. Yesterday we held a roundtable to discuss the threat posed by bluetongue, and we are in constant dialogue with all those who have direct interests and expertise. We will be working in lockstep.
Robin Swann (South Antrim) (UUP)
In his initial answer, the Minister talked about protecting the UK and spoke about our nation’s farmers. He also advised farmers to consult gov.uk, which gives advice to Scottish, English and Welsh farmers but not to Northern Ireland farmers. May I ask him why he has abandoned them, given that the last outbreak, in 2001, cost the Northern Ireland economy £24.2 million? One small region in Germany cannot export to Northern Ireland. Does the Minister not agree that there should be a complete ban on the import of German products to Northern Ireland as well as the rest of the United Kingdom?
Daniel Zeichner
We stand with farmers throughout the United Kingdom. The circumstances are slightly different, for reasons that the hon. Gentleman will understand, which is why we have to provide appropriate advice, but we are working in tandem and lockstep with colleagues across Europe to beat this horrible disease.
Mr Luke Charters (York Outer) (Lab)
It is the critical work of the Animal and Plant Health Agency in Weybridge, which I visited recently, that will prevent foot and mouth from reaching our shores. The £200 million for the agency that the Government have announced is welcome, but will my hon. Friend commit himself to reviewing its funding, particularly in the event of multiple concurrent diseases?
Daniel Zeichner
We constantly keep under review the resources that are available to enable us to tackle all these issues. On the basis of a number of questions today, I shall be happy to visit Weybridge at the earliest opportunity.
Mark Pritchard (The Wrekin) (Con)
Unfortunately, as the Minister will know, foot and mouth disease looms large in the memories of many Shropshire farmers. Talking of visits—this is a genuine point—I wonder whether the Minister, and indeed the Secretary of State, would consider visiting Harper Adams University in my constituency, which, as he will also know, is the top agricultural university in Europe. I mention that because it has veterinary experts with specific expertise in this disease and others.
As we heard from the shadow Minister, my hon. Friend the Member for Epping Forest (Dr Hudson), more than 6 million pigs, cattle and sheep were lost in 2001 and 2007. The Minister mentioned biodiversity. Can he update the House on illegal meat imports and checks at the border, and the implementation of the border target operating model?
Daniel Zeichner
I thank the hon. Gentleman for his invitation; I shall add him to my list. The border checks involve a complicated set of issues, but one of the Brexit benefits, if you like, is the existence of those checks, and I am satisfied that they are providing a level of security that should give people confidence. As I said in an earlier answer, we have strengthened the controls on personal imports. It is always a challenge to protect any area, but we are in a better position than colleagues in mainland Europe.
Dr Danny Chambers (Winchester) (LD)
It is good to see cross-party support for increased investment in Weybridge, which has long been needed, but my right hon. Friend the Member for Orkney and Shetland (Mr Carmichael) mentioned biosecurity, and we know that a great deal of illegally imported meat is coming through our ports. That is a huge biosecurity risk, and an even greater risk if there is foot and mouth on the continent. As well as investing in Weybridge and improving those facilities, can we look at how we can resource the port authorities properly to catch all this illegally imported meat?
Daniel Zeichner
That is an important point. We will try to do all that we can to ensure that illegal imports are intercepted and stopped. I am delighted to observe the outbreak of cross-party consensus on the need for more investment, and I hope there will also be an outbreak of consensus on how to fund it.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
My constituency was one of the most significantly impacted by the 2001 outbreak. Virtually every hoofed animal in Dumfriesshire was slaughtered, and the smoke from the pyre hung over the Annan valley in particular for days. A large part of the market in livestock in my constituency comes from Longtown market, in the constituency of the hon. Member for Carlisle (Ms Minns), which was a source of the previous outbreak. Will the Minister ensure that we work closely with the Scottish Government, given that there is a significant amount of cross-border movement of animals that needs to be properly identified and regulated?
Daniel Zeichner
The right hon. Gentleman speaks with passion and paints a vivid picture of that dismal period, which, sadly, I remember well. I can give him an absolute assurance that—as he will know from his time in government—the veterinary officers work very closely together, particularly on an official level. This is an entirely shared endeavour, and we will do everything we can to ensure that that there is the close co-operation that is needed.
Ann Davies (Caerfyrddin) (PC)
I am a dairy farmer, and the devastating outbreak of foot and mouth more than 20 years ago was on my doorstep. We were lucky, as a family farm, but sadly others within my farming community in Wales were not. The outbreak was also a food security issue, as it was understood to have derived from food waste fed to pigs. What lessons have the UK Government learnt from that outbreak to enable them to secure our food chains better and keep our livestock and food supplies safe?
Daniel Zeichner
I recognise the hurt that the hon. Lady recollects from that dreadful time. A great deal of work was done in the light of those events, and lessons have been learnt; for instance, technology has changed and improved. I will not go into all those lessons, which are probably worthy of a longer debate, but it is important for us to act on them, because we do not want a repeat of what happened in 2001.
John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)
Like many other Members, I clearly remember the events of 2001, not least because all the cattle and sheep on our family farm—my father’s farm in Berwickshire—were slaughtered. The emotional trauma will stay with farming communities for many years to come. I am reassured that this Government are engaging with the Scottish Government, but is the Minister also speaking to NFU Scotland and to local authorities, to ensure that they are able to support farming communities in the best way possible?
Daniel Zeichner
The hon. Gentleman has spoken with passion and conviction about that dreadful time, and I fully respect that. We were notified of the outbreak on Friday; today is Wednesday. Of course we are ready to move to the next stage should it be necessary, but at this point the key priority must be ensuring that we keep the disease out of our country, and that is where the attention is currently focused. In the dismal eventuality that we have to move to measures within our country, we will of course work very closely with everyone who needs to be involved.
Rachel Gilmour (Tiverton and Minehead) (LD)
I am sure that my farmers, like me, will be hugely grateful to know that the ban will operate with cross-party support; our farmers are more important than party politics. Back in 2001, I was the Liberal Democrat candidate for the Totnes constituency. The amount of communication with farmers before the outbreak was the only thing that made it easier for them to understand what was going on, because one could not go on a farm once it had started. May I encourage the Minister to communicate with farmers as much as he can during this very difficult time?
Daniel Zeichner
I am grateful to the hon. Lady for her recollections of that time. I reiterate that we are trying to ensure that foot and mouth disease does not arrive on our shores. Should that happen, we will move to another phase. We are not at that point yet, and it is important to reassure people that we have excellent measures and excellent people in place. They are working very hard to ensure that we do not get to that point.
Harriet Cross (Gordon and Buchan) (Con)
I welcome the Government’s efforts in bringing us up to speed today, but also in imposing the import ban. I recognise that the ban applies to products from Germany, but does it capture products that may originate there but for which the point of import is outside Germany? What steps are the Government taking to proactively increase spot testing or screening across the country, so that we can get ahead of any possible outbreak?
Daniel Zeichner
We are applying all the rules that we can to ensure that we exclude German products at the moment, but there is quite a complex set of supply chains within the European Union. The key priority is live animals. There is nothing fortuitous about bluetongue, but there have been restrictions on movements for some time, so we are probably better protected than we might have been. We cannot say for sure that nothing will move across the continent and come into the country, which is why it is very important that people are vigilant. Should foot and mouth disease cross the channel, speed will be of the essence to ensure that we shut it down. However, from talking to the chief vet and her officials and my conversations with German colleagues, I am confident that everything that can be done is being done. I hope that reassures the hon. Lady.
Caroline Voaden (South Devon) (LD)
I am sure that nobody in Devon will forget the horror of 2001, when half the farms in the county were affected by foot and mouth. Does the situation in Germany provide an impetus for the Minister to move forward with securing a veterinary deal with the European Union?
Daniel Zeichner
We do not need any extra impetus; the Government have committed to get a better deal. What I can say to the hon. Lady is that the relationship with our German colleagues is excellent at the moment, and they are giving us the full co-operation that we need.
Charlie Dewhirst (Bridlington and The Wolds) (Con)
The outbreak of foot and mouth disease in Germany is a timely reminder of the livestock diseases that threaten the UK every day. The Minister has said that he will take every precaution available to him, so will he use this opportunity to permanently ban all personal imports of meat, and to ensure that both the public health authorities and Border Force are resourced to tackle illegal meat importation?
Daniel Zeichner
The hon. Gentleman and I spoke frequently when he was in his previous role and I was in opposition, and he knows of what he speaks. We have strong measures in place. We strengthened them a few months ago, and I am confident that they are at the right level at the moment. Of course, there is always a case for further investment, and I am sure that the hon. Gentleman will support any measures that we bring forward.
Jim Allister (North Antrim) (TUV)
Does the Minister accept that the reason why he cannot provide national protection for Northern Ireland is that this House has surrendered the right to make such regulations? They cannot even be made in Stormont, because only a foreign Parliament is now entitled to make them. Therefore, we in Northern Ireland do not have the same protections for our farmers and their livelihoods that are afforded elsewhere. The ban is restricted to products coming from the affected areas in Germany. Given that context, will we see the absurdity that we have seen in response to bluetongue, whereby cattle and livestock from mainland Europe can transit through GB to Northern Ireland and, indeed, anywhere in the island of Ireland, despite the ban? Is that same loophole going to apply in this case?
Daniel Zeichner
I am grateful to the hon. and learned Gentleman for continuing our dialogue on this issue. I do not recognise that loophole, and I can assure him that Northern Ireland will be fully protected, because that is what we are determined to do.
David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)
Farmers in my constituency are very concerned by this news, as Powys was one of the hardest-hit regions in the 2001 outbreak and the trauma remains for the 2,000 livestock farmers affected. Can the Minister provide us with some further details on the conversations that he has had with the Welsh Government, and will he confirm that the Welsh Government will commit to working with local authorities?
Daniel Zeichner
I thank the hon. Gentleman not just for his question, but for the concern he expressed about his constituents, who suffered so grievously. The detailed conversations on these issues are conducted between the veterinary officers, who have a very close network. However, any political decisions that need to be made will be made by Ministers, and I have a very close relationship with Minister Irranca-Davies. If further action is needed, we will work together to stop any further incursions.
Helen Morgan (North Shropshire) (LD)
In Shropshire, dairy and other livestock farmers have been having a torrid time recently, and they will have read this news with a sense of dread. I am also an officer of the all-party parliamentary group on food security, and we recently heard some eye-watering evidence from the border authorities at Dover about illegal meat imports and the threat that they pose to UK biosecurity. Can the Minister explain to the House what assessment he has made of the problems with that process, and what he intends to do to ensure that diseases such as foot and mouth do not arrive in the UK?
Daniel Zeichner
I thank the hon. Lady for expressing her concern. I reiterate the point I made earlier about the border controls that we have in place. I am afraid this has been a long-running issue, but we have much stronger border controls in place than we would have done in previous times. We are working hard with the port health authorities to make sure that we crack down on illegal imports of meat.
Jim Shannon (Strangford) (DUP)
I declare an interest as a member of the Ulster Farmers Union. Indeed, I live on a farm on the Ards peninsula, where dairy farming and sheepmen surround me, and the impact on them would be great. For that reason, I want to ask the Minister a question. I can well remember the piles of dead animals and the traumatised farmers, who were all concerned, as they always are, about their animals—that was over 20 years ago, in 2001. The lessons were hard and well learned. Three other Northern Ireland MPs have asked similar questions, and I am the fourth. We need to clarify for farmers, my neighbours in Northern Ireland and all those who farm that there will be zero tolerance of products from Germany. Will the Minister confirm that a full, UK-wide report, including on Northern Ireland, will come to this House before any ban is lifted?
Daniel Zeichner
The hon. Gentleman speaks with passion on these issues. I can absolutely assure him that the measures in place to protect farmers in Northern Ireland are strong and will be good enough to make sure that we can protect people properly. Clearly, there is a slightly different set of arrangements in Northern Ireland, as he will be well aware. We have to respect that, but we are getting absolute and total co-operation from our German colleagues. There will be no meat coming from affected parts of Germany to Northern Ireland.
Local Government Reorganisation
(3 days, 7 hours ago)
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David Simmonds (Ruislip, Northwood and Pinner) (Con)
(Urgent Question): To ask the Minister to make a statement on plans for local government reorganisation.
The Minister for Local Government and English Devolution (Jim McMahon)
The English devolution White Paper sets out how this Government plan to deliver on our manifesto pledge to transfer power out of Westminster through devolution and to fix the foundations of local government. This Government’s long-term vision is for simpler structures, making it clearer for residents who they should look to on local issues, with more strategic decisions to unlock growth and to deliver better services for local communities.
On 16 December 2024, I wrote to all councils in the remaining two-tier areas and neighbouring small unitaries to set out plans for a joint programme of devolution coupled with local government reorganisation. We acknowledge that for some areas the timing of elections affects their planning for devolution, particularly alongside reorganisation. To help to manage these demands, we will consider requests to postpone local elections, as has been the case in previous rounds. Where local elections are postponed, we will work with local areas to move elections to a new shadow unitary council as soon as possible. This is a very high bar, and rightly so.
The deadline for such requests was Friday 10 January. Today, my Department has published a list of all county and unitary councils who have made requests, including those who want to delay elections from 2025 to 2026. For the avoidance of doubt, this is the list of requests; it is not the final list that will be approved. We will consider these requests carefully and postpone elections only where there is a clear commitment to delivering both reorganisation and devolution to the ambitious timetable set out. While not all areas listed will go forward to be part of the devolution priority programme, we are grateful for the local leadership shown in submitting these requests, and a decision will be made in due course as soon as possible.
We welcome the large number of areas that have come forward seeking to join the devolution priority programme, reflecting our own ambition for greater coverage across England. This Labour Government were elected on a manifesto to push power out of Westminster and to relight the fires of our regions, and I am delighted that local leaders across England are sharing that ambition.
David Simmonds
Although it was not a manifesto commitment, the Government published their agenda for reorganising council structures in England before Christmas, and we support our local government colleagues who are clearly required to respond to that call from Government. With local elections scheduled to take place in May this year and councils already incurring significant costs arranging polling stations and electoral canvassing, and preparing to receive nominations and issue postal ballots, it is not surprising that many councils have acceded to the Government’s expectation of a delay in these polls. After all, why incur millions in costs to local council tax payers for electing people to councils that are to be abolished shortly afterwards?
However, there remains significant uncertainty about where and if those elections will be delayed. With deadlines looming for key points in the organisation of those elections, that uncertainty risks some wasted costs for council tax payers, so we on the Conservative Benches have a series of questions. We know that many of those councils are Conservative-run, and with Conservative councils charging on average £80 less per household than Labour ones and £21 less on average than Lib Dem ones, voters will want to understand the impact of the Government’s reorganisation on their council tax and on their back pocket.
May I ask the Minister, first, what assessment has he made of the Boundary Commission’s capacity to undertake the necessary reviews to ensure equal distribution of electors across the new local authorities? Can he give an indication to the House of when he will make decisions, so that local authorities will know whether they are preparing to organise elections and are willing to incur those costs or not? We know that a number of other announcements are in train, particularly the indication from the Deputy Prime Minister that areas currently setting a low level of council tax will be punished through revisions to the funding formula, so when can local authorities expect to know what impact such revisions to the funding formula will have? I look forward to informative answers from the Minister.
Jim McMahon
I thank the hon. Gentleman for those questions, and I am genuinely grateful for the spirit of consensus around the broader issue. I accept that there may be differences of opinion on pace, but we do not shy away from our ambition to see devolution experienced by the whole of England. I give a degree of credit to the previous Government for building out devolution in the north of England and the midlands, but surely we have to demonstrate that this project is not reserved for the north of England and the midlands. This is a project for the whole of England, and we are on with that.
Our determination to ensure that we deal with these structural changes early in the Parliament is clear, but that is shared by local government. It is important to say that although of course we will set the timetable and provide support on both the devolution priority programme and local reorganisation, it is for local areas to self-organise and to agree to be part of the programme. We are not mandating this; we are not forcing it. All the requests that we have had since Friday have been from areas who share our ambition.
The hon. Gentleman will know that it is sensible to take the approach that, if reorganisation is a genuine proposal—and the bar has to be high for that test—it is nonsense to have elections to bodies that simply will not exist. It is far better that we move at pace and create the new unitary councils and then hold elections at the earliest opportunity.
I am not going to get into the subject of council tax, partly because it is outside the scope of the hon. Gentleman’s urgent question. Also, he was slightly mischievous in the way that he framed his remarks. On the point about capacity, however, it might be helpful if I lay out what the process will be. Local areas will make the request. We will issue statutory invitations at the end of the month, and areas will need to self-organise. It is not for the Boundary Commission or the Government to lay down which plans come forward. It is for local areas to submit proposals to us, and at that point the Government will decide on the right proposals among what could be a number of options that come forward from local areas. Again, it will be for local areas to self-organise and make those proposals to us.
Madam Deputy Speaker (Caroline Nokes)
I call the Chair of the Housing, Communities and Local Government Committee.
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
I thank the shadow Minister for securing this important question; he has highlighted some key issues.
Sadly, we know that our councils are at breaking point. The Select Committee’s first major inquiry is to look at local government finances, and we look forward to engaging with the Minister on it. It was reported that local authorities in England were facing £77.5 billion-worth of debt by the end of last year. Much of that is debt to central Government or from borrowing. Sadly, because of that, vital frontline services such as housing and social care are at breaking point. Residents cannot afford to be caught up in buck-passing or discussions about accountability if this reorganisation goes through, so can the Minister assure the House that residents will still have the same level of power and scrutiny over vital services during the reorganisations?
Jim McMahon
I thank the Chair of the Select Committee for those questions. What I hear from residents and even from councillors in two-tier areas is that, more often than not, local residents have no idea which council to go to in order to get the answers they need on local services. Reorganisation will provide efficiency savings in organisational costs that can be directed towards frontline services, which we believe are the priority for taxpayers. There should not simply be the cost, in many cases, of such services existing. We also believe that it is right, from a democratic accountability point of view, that residents have a clearer line of sight on which body to hold to account for local decisions.
On the point about local government finance, which we absolutely understand and accept, we have worked hard and I would say we have been relatively successful on rebalancing the funding crisis in local government. We have done that by providing £5 billion of new money, taking the total allocation to £69 billion. We cannot undo 14 years of damage in six months—it has been damaging over the 14 years—but we are now bridging to that multi-year settlement where we can really begin to repair the foundations. I think we have made progress on that.
Vikki Slade (Mid Dorset and North Poole) (LD)
There is no doubt that local government needs significant reform, and Lib Dems are passionate about putting power into the hands of local communities, but we are concerned that rather than producing true devolution, these plans will end up as a top-down diktat from Whitehall. MPs and district councillors from areas including Devon, Surrey and the midlands have told me that submissions appear to have been made without their district councils being involved or consulted, and without the opportunity to undertake consultation with residents and businesses. What steps are the Government taking to ensure that they engage meaningfully with every level of councils?
Councils such as Bournemouth, Christchurch and Poole, which I used to lead, face Hobson’s choice. Tonight, councillors will be voting on whether to join proposals to their east or their west, neither of which reflect their urban needs or their distinct character. Or do they sit it out and hope for the best? What plans do the Government have to ensure that residents will have the democratic ability to decide on the right devolution plan for them? Can the Minister confirm, given that these plans will take more than a year to implement, that all the elections due in May 2025 will go ahead?
Jim McMahon
I do not want to disregard the good work of district councils in this conversation about reorganisation, and about redirecting money to operational costs on the frontline, so that taxpayers get better value for money and see the benefit in their local public services. I pay tribute to council officials, frontline workers and councillors, whether they are in unitaries, counties or districts, for their work. I just set out the view that the best way to achieve efficiency is by having more streamlined local government structures that enable money to go to the frontline.
On whether district councils will have a voice in the process, it is a fact that we have received requests for reorganisation, and statutory invitations go out at the end of the month, but it would be usual for the Government to be faced with a number of options for what those new boundaries might look like. The county might have a view about how many councils should be included in the reorganisation, and I suspect that districts might have a very different view.
It would be quite usual for a number of different proposals to come forward for a county. It is for the Government to try to strike a balance that takes into consideration identity, efficiency and having an anchor to the area that makes sense. We genuinely want this to be a collaborative process, so that we get the right outcome for local people.
Mr Paul Foster (South Ribble) (Lab)
As the Minister is aware, I was a district council leader in Lancashire until 5 July, when I got the Avanti train down to Westminster. As I have said for many years, the challenge we face is that the two-tier system does not work. It confuses our residents. The Local Government Association’s map of the different structures of local government in England is a mishmash, and it does not work. West Lancashire and South Ribble borough councils have put forward detailed proposals for local government reorganisation to the Minister, but the Conservative-run county council has not. My concern is that some elections will be cancelled and some will not. On the priority programme, will the Minister please consider enforcing the cancellation of all elections in places where he is moving forward quickly with reorganisation?
Jim McMahon
When my hon. Friend said he got the Avanti train down on 5 July, I think the Chamber was half expecting him to say that he had only just arrived, but he has been here for some time.
I know there are different views in Lancashire on what a good outcome looks like, and there are certainly different views on what a good process looks like, but I think there is a shared view that the time has come for devolution in Lancashire. When people look to Greater Manchester and the Liverpool city region, and see that Cumbria and Cheshire are organising to be part of the next stage, of course they want to be part of that. Lancashire is unique, in that we were already in discussions with it about its timetable and process. The level 2 agreement that is in place of course comes with investment, funding and other powers. Lancashire has agreed that by autumn, it will submit proposals to the Government that reconcile its organisational status; it will also bring forward a plan to move forward with a mayoral combined authority. Lancashire took the view that given that the timetable was already in place, it did not need to request that the election be cancelled.
To be clear, we absolutely see Lancashire as part of our priority work. It is critical. The prize for the north of England is completing the work on Cheshire, Lancashire and Cumbria, so that the whole north of England has mayoral devolution. That will be game-changing.
Lewis Cocking (Broxbourne) (Con)
I draw Members’ attention to my entry in the Register of Members’ Financial Interests.
In the devolution White Paper, the Government set half a million people as the appropriate size for these new councils. Can the Minister therefore rule out creating big super-councils that represent more than a million people? Will he meet me to discuss devolution and local government reorganisation in Hertfordshire?
Jim McMahon
It is important that the Government set out the framework. We were very directive in the White Paper about our view on reorganisation and devolution. In every conversation we had with the LGA, the County Councils Network, the District Councils Network and others, we heard that the worst outcome would be the White Paper speaking to an issue without going close to clarifying what outcome we want. The response to the priority programme has been reflective of that clear direction.
We were up front in saying that, for efficiency, new unitary authorities should have a population of around 500,000, but we also made it clear that if the reorganisation went hand in hand with devolution, a degree of flexibility would be needed to make sure we balanced strategic oversight of the combined or strategic authority with the local identity and sense of belonging that people need. I also make it clear that it does not matter whether we are talking about councils going through reorganisation, or about existing councils and metropolitan authorities, be they in London or the north of England. Wherever they are, we expect councils to organise their neighbourhoods and communities, local public services and democratic engagement so that people feel more power in the place where they live.
Daniel Francis (Bexleyheath and Crayford) (Lab)
My residents in Crayford, in the London borough of Bexley, have their services provided by one council, but in many cases, residents on the same road have their services provided by two councils—by Kent county council and Dartford borough council—which causes confusion, as the Minister said. Does he agree that the changes introduced in the English devolution Bill will make local government more effective and save money for those taxpayers?
Jim McMahon
That is exactly what this is about. This is the most ambitious reorganisation in England for at least 50 years, maybe longer. We need to avoid the sense that this is just rearranging the local government deckchairs. It is not about that. The devolution White Paper is ambitious, and that ambition is about wresting power from Westminster and Parliament and putting it in the hands of communities up and down the country. For far too long, power has been held in a very narrow way by a handful of people, at the exclusion of millions of people in this country. Frankly, people have had enough, so we have to find a different route.
Kit Malthouse (North West Hampshire) (Con)
I am fortunate to work with two local authorities, Basingstoke and Deane borough council and Test Valley borough council, which, after many decades of careful stewardship, are debt-free and have significant assets on their balance sheets, to the benefit of their residents. What will the Minister do in this local government reorganisation to protect that legacy? Would it not be profoundly unfair if those many years of careful stewardship were wiped out by amalgamation with more profligate neighbouring councils?
Jim McMahon
It is not my intention to set one council against another. When areas begin to look at what new unitary boundaries might look like, they will need a view on identity, scale and achieving efficiency, and, ultimately, what construct will deliver good public services, be it adult social care, children’s services or those neighbourhood services that, in many places, have been eroded to the point where people wonder if they exist at all.
We have to rebuild from the ground up. This process, regardless of a council’s debt or financial status, is part of that rebuilding. Let us be honest: nobody in this Chamber, or in this Government, can put a number or this. We do not know what the outcome will be. If this is genuinely about local areas self-organising and presenting to Government their view of what a good outcome would be, we need to be open about that.
Alice Macdonald (Norwich North) (Lab/Co-op)
Local government reorganisation and full devolution is long overdue, and I believe it will bring many benefits to Norfolk and Norwich. In Norwich North, just as my hon. Friend the Member for Bexleyheath and Crayford (Daniel Francis) said, one council might collect the bins on one side of the street, and another collects them on the other side. Building on the questions from Opposition Members, can the Minister reassure us that cities like Norwich will have a strong voice in this process, and will have their voices heard on the key economic drivers?
Jim McMahon
That is a very important point, and I pay tribute to MPs in Suffolk and Norfolk for the work that they have done in making the case for greater devolution of powers. I also pay tribute to county and district councils for the cross-party political leadership that they have shown in pursuit of devolution. Members will know that the original agreement for both Norfolk and Suffolk was not one to which the Government could agree, for a number of reasons that have been identified. However, the commitment from leaders in the area to finding a way through is appreciated and valued, and we will honour that in the next steps.
We absolutely believe that in large parts of the country—I see it in Exeter, Lincoln, Ipswich and Norwich—we have important economic anchors in cities that previously have not had a seat at the devolution table because they have been district councils. We have to deal with that as we go forward.
Mr Lee Dillon (Newbury) (LD)
Will the Minister update the House on the capacity in his Department to manage these reorganisations? He spoke about the deadline having passed, and having received expressions of interest. How many can his Department manage at any one time? What will be the determining factor in which ones are chosen to progress now?
Jim McMahon
The Department stands ready to support local areas, both on devolution and on local government reorganisation, and will make sure that there is a genuine partnership when it comes to ensuring that capacity. We will not just rely on local areas to find it; we will work together on that.
We will have to present the information the hon. Member refers to on another date, not today. Until we know what the final programme is, we will not know what is required to deliver it. There is no arbitrary upper limit. Nevertheless, we need to be realistic that there is a high bar on devolution and reorganisation, and we can only allow forward plans that have a credible proposal for devolution. If plans are less developed when it comes to devolution, then even if other parts of them are compelling, and do things that we would want to see come about, politically, I am afraid that cannot stand. They have to be credible plans that ultimately lead to fulfilling the ambition for devolution, and that will be the priority.
Jen Craft (Thurrock) (Lab)
The historical bankruptcy in Thurrock, from which my constituents are still suffering, is symptomatic of a system of local government that is letting people down badly. Devolution and reorganisation represent a once-in-a-generation opportunity to capitalise on growing opportunities in Essex, deliver better value and improve services. Does the Minister agree that reorganisation is the right step, and this is the right time? It will allow us to move on from the broken system and deliver more power and opportunities to communities in places such as Thurrock.
Jim McMahon
My hon. Friend will know that there are particular issues in Thurrock, relating to historical decisions taken in that local authority. We believe that efficiencies can be garnered through reorganisation, and that if we redirect money to neighbourhood services that people can see and feel, their satisfaction with local government and local public services will increase. We also accept, though, that some systemic problems are not addressed by reorganisation alone; in the end, the multi-year settlement and the funding reforms that are taking place will have to be the foundation for that.
Sir Geoffrey Clifton-Brown (North Cotswolds) (Con)
The people of Gloucestershire are expecting elections this May to their county council. If that is not to happen, will the Minister tell us precisely when the date will be decided, for all the reasons so excellently set out by my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds)?
Jim McMahon
The hon. Gentleman makes a fair point. Clarity is important for areas; they need to know whether they will go ahead with elections so that they can organise. We seek to give clarity by the end of the month, so in a couple of weeks at most.
Andy MacNae (Rossendale and Darwen) (Lab)
I associate myself with the excellent remarks of my Lancashire colleague, my hon. Friend the Member for South Ribble (Mr Foster), and I thank the Minister for recognising the massive opportunity that reorganisation and devolution presents for Lancashire. It has been held back for many years by our inability to come together and move forward. Given that we now have an ongoing devolution process, and genuine proposals for reorganisation that are supported by a majority of councils across the county and by MPs, and given the significant costs of holding local elections—£3 million in the case of Lancashire, which could fill an awful lot of potholes—it feels like Lancashire county council’s refusal to put forward a proposal to cancel the upcoming May elections is about self-interest and short-term political imperatives being put ahead of the needs of residents. Does the Minister agree that it is regrettable, to say the least, that the request has not come forward, and that we should not hold those elections, but put the needs of residents first?
Jim McMahon
I will be careful. When we came into government six months ago, I was clear that we needed to reset the relationship between central and local government. For many years in opposition, I observed Governments parading around instances of councils that were in disagreement in a very public way, and I thought that undermined the system as a whole. While it might not always be possible, where there are differences of views, they should probably be aired in private and not in Parliament, from a ministerial point of view.
Even though there are differences in Lancashire about pace, potentially, and about what a good outcome might be, there is at least agreement that devolution is the right thing for the county, and that having the same powers as Greater Manchester and the Liverpool city region could be game changing for Lancashire’s economy and local jobs. When I say “local jobs”, I mean skilled, decent work that gives people pride of place; that is absolutely central to this Government. Let us focus on agreement, and put some of the disagreements to one side. However, I take on board my hon. Friend’s local perspective entirely.
Dame Karen Bradley (Staffordshire Moorlands) (Con)
I am pleased to see that Staffordshire is not on the list and that we will have our county elections this May. The Minister will know, however, that my constituents do not want to be subsumed into greater Stoke-on-Trent. Will he give them some reassurance—any at all—that they will have the choice and can say no if they do not want to be part of greater Stoke-on-Trent?
Jim McMahon
I quite like Stoke-on-Trent; I am not sure what the local disputes are there. Maybe that is something not to go into. Focusing instead on process, that change would require consultation, and every area that has had a devolution agreement and eventually a mayoral election has had that consultation take place. There was some recent polling that said that the public were more likely to be supportive of the mayoral model of government if they had a mayor already in place, because they could see the benefit. In the end, how we reconcile the situation England will require compromise in some places. I say that because England is unique, it is diverse and, from an identity point of view, there is much that different areas have in common but there are some contradictions too. It is our job, through the course of building this out, to work at a local level to try and find the right solutions. That commitment is firm.
Several hon. Members rose—
Madam Deputy Speaker
Order. The House will see that we have a lot of Members to try and get in, and I need to finish this urgent question by 2.15 pm. Will the Minister and other Members keep that in mind when answering and asking questions?
Louise Jones (North East Derbyshire) (Lab)
The reason I am in this place and my absolute priority is to ensure that we deliver good public services to the people of North East Derbyshire, through well-run government with representatives who are invested in their local community and held to account. Will the Minister assure me that any discussions over reorganisation will include local boroughs and districts, and that any agreement reached will make sure that we reflect both those priorities?
Jim McMahon
The request can come in for reorganisation, but the Government’s role from the point at which we start the statutory invitation process becomes quasi-judicial. We therefore need to make sure we steer well clear of defining what outcome we want because we are, in effect, neutral in that process. It is our job to receive proposals as they come forward, and it could well be that the county and district councils put forward entirely different proposals. It is our job to make sure we consider both on an equal basis.
Mr Will Forster (Woking) (LD)
As the Minister knows, the former administration at Woking borough council racked up debts of £2.1 billion. That money will never be fully repaid to the Government, but surrounding local authorities are anxious that as part of reorganisation they might have to share that debt. Will the Minister confirm how the Government will handle debt in Woking, Surrey and elsewhere as part of the reorganisation? Also, will he agree to write off Woking’s unsustainable debts to ensure that reorganisation happens sensibly?
Jim McMahon
Agreeing to write off £2 billion of debt at the Dispatch Box would be quite career-limiting, I would say. I can say, however, that the scale of the financial challenge in some areas is absolutely understood and we will work to try and find a solution. We are not yet at the point of announcing that, however.
Mr Jonathan Brash (Hartlepool) (Lab)
In Hartlepool, 75% of every penny spent by the council is spent on social care. That is contributing to a burden on council taxpayers in Hartlepool that is far too high. Does the Minister agree that in the wider local government reorganisation, consideration needs to be given to regional collaboration on social care or, indeed, removing social care from local government altogether to ease the burden on council tax payers?
Jim McMahon
My hon. Friend will be aware that Dame Louise Casey is conducting a broader review of adult social care for reasons that are well understood by the House. On whether the matter should or should not sit with local government, I will say that where local government really excels is in being local and rooted in the community, in being the deliverer of a public service and in being able to organise at a place level. That does make a difference, and we should not underestimate the impact when done well. We need to make sure that social services are adequately funded for the work they have to do to provide a good level of service for local people.
Mr Richard Holden (Basildon and Billericay) (Con)
Across Basildon and Billericay, my residents are concerned about the idea of two years of delay while massive reorganisation goes on locally. Will the Minister provide reassurance that the local plan for 27,000 new houses across the area, which has just been consulted on, will not suddenly be rushed through by a local council that will not exist in future, with residents having to live with the consequences for years to come?
Jim McMahon
I would say that, given our housing crisis, 27,000 new homes seems like good news to me, and we need to see more of that. Councils need to operate in a business as usual way, making sure that they get their business done. The worst outcome would be for councils going through a reorganisation to press pause on important items of business. That would be a complete absence of leadership.
Alex Mayer (Dunstable and Leighton Buzzard) (Lab)
One effect of creating more strategic authorities appears to be the splitting of transport and highways powers in more areas. Will the Minister provide assurances that this will not slow down the delivery of capital projects that are necessary to achieve economic growth?
Jim McMahon
No, that is certainly right. Our ambition is for acceleration, not for lagging behind, and we will make sure that no schemes are delayed as a result of reorganisation.
Bradley Thomas (Bromsgrove) (Con)
The Minister has quite rightly pointed out that residents across the country expect councillors to take a more strategic approach to deliver better services. My residents across Bromsgrove and its villages share that ambition. However, the biggest elephant in the room is the role of adult social care in the local government sector. Can the Minister outline to the House what decisions and what conversations are taking place across Government to address this so that future new councils, post reform, get off on the very best foot to improve their areas?
Jim McMahon
I feel that we have gone a long way to doing that, although we do accept that this is a bridging position to get us to the multi-year settlement. None the less, £3.7 billion of new money for adult social care in the settlement is a commitment laid out in pounds and pence in the way that local government has been asking for. We accept that there is a long way to go, and that councils need more support, but the Government are absolutely committed to rebuilding the foundations of local government and putting it on an even keel.
Chris Vince (Harlow) (Lab/Co-op)
I thank the Minister for his statement. Many of us across the House will have campaigned in district elections, as I have in Harlow. The No.1 thing that comes up on the doorstep in district elections is potholes, even though they are not the responsibility of district councils. Does the Minister agree that this English devolution Bill will not just simplify local government but be more cost-effective and bring more value back to the taxpayer?
Jim McMahon
My hon. Friend makes a very good case for reorganisation, and I agree with him.
Martin Vickers (Brigg and Immingham) (Con)
As the Minister will know, in Lincolnshire, where there are two unitaries as well as the county council, the three top-tier authorities have agreed on a package to go unitary. There are complications, because there is a ward boundary review going on in north-east Lincolnshire at the moment. Would the Minister consider cancelling that, as it seems a complete waste of resources? In the county council area, which covers roughly two thirds of the county, a mayoral election is taking place, and a new combined authority is being established this May. Given that, does he agree that it is important that elections go ahead to give the county a new mandate for what lies ahead?
Jim McMahon
From our perspective, we cannot allow the cancellation—or postponement, I would say—of elections to be driven by any political views. We are clear that this is an administrative process and it is about whether areas satisfy criteria that meet our devolution priority programme. Where areas are already in the programme because they have mayoral elections this year, it would be reasonable of me to say that we would need to see where the benefit is of elections being cancelled, given that devolution is taking place. But as I have said, we have only just received the proposals. We are taking time to review them, and we will make sure that is done in a fair way.
Sean Woodcock (Banbury) (Lab)
I refer the House to my entry in the Register of Members’ Financial Interests as a serving district councillor for 13 years.
I broadly welcome the thrust of this document. My question is on a matter that the Minister has already referred to—areas that are serviced by a number of different local authorities, which mine is. I have a county council, two district councils, any number of parish councils, and Banbury town council—Labour-run for the first time ever. In those areas, there will be a wide variety of views as to what a local government reorganisation should look like, because different communities have different views. Can the Minister assure me that the fast-tracking and the speed of this process, which I acknowledge the reason for, will not lead to rushed proposals that do not take into account what communities actually feel and look like?
Jim McMahon
I can absolutely assure my hon. Friend of that. Let me just say that in 2019, 11 district council elections were cancelled to allow reorganisations to take place, and so were seven in 2020. In 2021, the elections of three county councils and three district councils were cancelled to allow reorganisation. I say that because we cannot allow people to think that this is, in any sense, something new that has come out of nowhere. This is the day-to-day business of reorganisation done in the right place, in the right way, with full public consultation.
Rupert Lowe (Great Yarmouth) (Reform)
Given the abject failure of devolution in both Scotland and Wales and the fact that the Americans fought a war of independence on the slogan “No taxation without representation”, my constituents of Great Yarmouth would like an answer to two questions. First, why should they continue to pay their council tax beyond May, when they will not be represented by elected people? And secondly, by what name do they call these unelected councillors after May?
Jim McMahon
We need to be clear that the members who will discharge the functions of the council and the executive have been elected. The idea that they are not elected is not accurate, and we need to be careful about the language that we use. I believe—I am sure the hon. Member believes—that most councillors are good public servants and go into local government for the right reasons to represent their community, and we should not be targeting them unnecessarily. To be clear, they were elected, and we might take the view that, if they meet the criteria, their period of office should be extended to allow election to a new shadow unitary authority. On that basis, I hope that local people will support it.
Steve Race (Exeter) (Lab)
I thank the Minister for the level of engagement that he has given both me and my colleagues on this process since the English devolution White Paper was published. He will know that I have a high level of enthusiasm for local communities being given the ability to take more control of services in their area. Does he agree that devolution and reorganisation offers cities such as Exeter, Lincoln and elsewhere—the key economic drivers of this country—the opportunity to grow and invest sustainably in partnership with strategic authorities? Can he shed a bit more light on the process when a county council and a district council potentially disagree on the way forward?
Jim McMahon
It is quite usual for a county council and a district council to disagree on the way forward. From a Government point of view, we will consider proposals on an equal basis wherever they have come from—from a county council, a district council or a unitary authority that might change its boundaries. It is important that that is clear, because we want to make sure that, in the end, it is the right deal for local people, it is the right deal for taxpayers and it delivers good public services.
Alison Bennett (Mid Sussex) (LD)
I refer the House to my entry in the Register of Members’ Financial Interests.
How will the Minister avoid a fire sale of district and borough council assets once they are merged with county councils, which are crippled by the soaring cost of adult social care? Does he therefore agree with me that 2028 is too late?
Jim McMahon
We can only go as fast as the process allows. We can start the process early, and we have done that. We can give clarity early, and we are doing that. What we cannot do is to shortcut a legal process that requires adequate consultation, the development of proposals and a transfer of workforce and assets to a new unitary council. That must be done in the right way, which takes time. We absolutely understand the point about local community assets, which is why community asset protection and the community right to buy are so central to our agenda going forward.
Adam Jogee (Newcastle-under-Lyme) (Lab)
The Minister will recall, I hope, the concerns that I outlined the last time he was before the House. Efficiencies, as he put it, and improved services are of course important, but so too are local identities and existing communities. With that in mind—I have asked him this before—how will we ensure that local identities are protected? Will he meet me to discuss the impact that these proposals might have on the ancient and loyal borough of Newcastle-under-Lyme?
Jim McMahon
The point that my hon. Friend makes about balancing identity is as much about culture and approach as it is about where boundaries for councils are drawn. Sometimes, the identity of a council will match closely with the identity of a place, but often it does not. In urban, rural or coastal areas, many communities are far more nuanced or localised, and there can be some quite tense local neighbourhood disputes as a result. Any reorganisation has to respect the historic locally felt identity of every part of the new area, not just the area in which its headquarters might be based or that its council might be named after, and holding firm on that has to be part of the approach.
James Wild (North West Norfolk) (Con)
The Government’s timetable is wholly inadequate. Given that the previous deal that Norfolk negotiated was scrapped without any consultation, how will the public be consulted on any changes going forward, and does the Minister accept that a minimum population of half a million may not be appropriate in rural areas, to avoid councils being very remote from the people they serve?
Jim McMahon
We tackled that head on in the White Paper, which said that, for efficiency, the minimum population will be 500,000, but was clear in the same paragraph that—this is where devolution goes hand in hand with reorganisation—there needs to be some flexibility for the reasons that the hon. Member set out. That is our firm commitment.
Mike Martin (Tunbridge Wells) (LD)
Kent county council has opted to go on the priority programme and cancel elections this May; I guess turkeys do not vote for Christmas. The timetable going forward is a little confused. We will have mayorals in 2027, unitaries in 2028, and then it stands up later on. Could the Minister give some more detail on that? If the process is stretched out like that, Conservative Kent county councillors will be in power for seven years. Judging by my inbox, the people of Kent are absolutely appalled by that. I would be grateful for more details.
Jim McMahon
From the Government’s point of view, acting in a legal, quasi-judicial way, we have to take such decisions on the value of the evidence and the proposals. It is not our job to get involved in the politics of whether the Liberal Democrats want to see the back of the Tories but the Tories want to avoid an election, or vice versa. It is our job to play with a straight bat, and look at the benefits of the proposals. Kent has applied, but we are going through the process of screening applications to ensure that they are realistic proposals for devolution and LGR that hold together. If they meet those criteria, we will support them. If they do not, we will not.
Mr Mark Francois (Rayleigh and Wickford) (Con)
Despite what senior county councillors are telling Ministers, there is absolutely no clamour in Essex for devolution—quite the reverse. Nor do the public support the Government’s proposal to cancel the local elections; that is anti-democratic. If the Government do press ahead, why do we not take the opportunity to have a county-wide referendum in Essex to see whether the public—the council tax payers—really support this? They can vote for massive change or to remain as they are. If there is such a referendum—I never thought these words would pass my lips—I will gladly vote remain.
Jim McMahon
I think the right hon. Member is getting at the fact that there will be a range of views on this issue, but it is the Government’s job to give direction, and we believe that efficiencies can be drawn out. When asked, I think local people would say that they would much rather that local neighbourhood services are maintained and grown, rather than bear the overhead costs of organisations that exist for the sake of it. It is for the consultation, and the proposals, to draw out the best outcome in the process.
Caroline Voaden (South Devon) (LD)
I welcome the theory of simplifying local government, but I am concerned about the pace at which the Government are trying to move. Devon has a very complicated landscape, with Labour-run cities, a Conservative-run county and many Liberal Democrat districts. Conflicting proposals have already been submitted to the Government by the districts and the county, so can the Minister explain how the Government will adjudicate between those conflicting proposals and decide which one will come out on top?
Jim McMahon
We will see what comes forward from local areas. In some areas, there may well be a general consensus on the number of unitary authorities, but varying views on the boundary lines. In other areas, we can perhaps expect there to be entire disagreement on both the number of councils that should follow from the proposals and the boundaries that would be drawn as a result. At this stage, all we can say is let us see what comes forward. We will try to make the right decision by balancing identity, efficiency and the relationship to devolution going forward.
Neil O’Brien (Harborough, Oadby and Wigston) (Con)
We already knew that the Government wanted to abolish our local district and borough councils in Leicestershire without consulting local people. We now know that the proposal will involve a significant expansion of the boundaries of the city of Leicester—something demanded by the Mayor of Leicester that would lead to significantly higher council tax for my residents. Within days, thousands of local people have signed a petition started by me and other local MPs who are against the proposal, including my hon. Friend the Member for Rutland and Stamford (Alicia Kearns), who cannot be here today. My local districts and boroughs are against it, so will the Government at least agree to hold a local referendum in Leicestershire before imposing this proposal from London that local people do not want?
Jim McMahon
A theme is developing of campaigning for elections to bodies that some wish will not exist in the future—that sounds familiar—and for referendums being the answer to some of this. It is about local leaders showing leadership. I understand completely that there are different views, but I am impressed by the leadership being shown by Labour, the Conservatives, the Liberal Democrats and others, because local leaders believe in their place and want the best outcome for it. I will leave the local politics to them. It is our job to ensure that we assess the proposals that come forward on a fair basis.
Monica Harding (Esher and Walton) (LD)
My constituents are well served by the fiscal stewardship of their district council of Elmbridge, and are rightly concerned that they will be forced to take on the debt of neighbouring councils such as Woking. Equally, they are looking forward to the May elections, and kicking Conservative Surrey out. Does the Minister not agree that leaders taking devolution forward should have a democratic mandate, and will he reassure my constituents that any unitary moves will be paused until the question of debt is sorted out?
Jim McMahon
We certainly accept, particularly in the case of Woking, where the debt is significant, standing at over £2 billion, that the question of debt has to be addressed through the process, but it is for the process to address it. We cannot say up front how we will treat debt in different areas, because every area is different. I do not think that any Member would expect us to do that.
Joe Robertson (Isle of Wight East) (Con)
I draw attention to my entry in the Register of Members’ Financial Interests.
Residents of the Isle of Wight are expecting full elections this May. The no-overall-control unitary authority has asked the Government to be part of a priority devolution deal with Hampshire, but not local authority reorganisation, which is not on the table. We are not being asked to do that because we are already a unitary. Does the Minister agree, therefore, that there is no good reason to delay elections when the Isle of Wight council’s future and viability is not under discussion? That is an accepted point. Why should a democracy have to have elections when the council will continue?
Jim McMahon
I think that is a fair point, and I will take it away.
Sarah Dyke (Glastonbury and Somerton) (LD)
Somerset, Dorset and Wiltshire are working together collaboratively on the Heart of Wessex devolution deal and hope to be on the devolution priority programme, but there is still some uncertainty over what decision Bournemouth, Christchurch and Poole will make. Can the Minister confirm that the decision to include the Wessex proposal will not be held back, depending on the BCP decision?
Jim McMahon
We have to stick to the principles of the White Paper, because that informs the legislation that will come later this year. We are very clear in the criteria that we will not, and cannot, agree to any devolution proposals that create orphans that cannot be resolved. We expect that local leaders will come together and do what is right, given the geography of their place, to deliver devolution as soon as possible.
Max Wilkinson (Cheltenham) (LD)
Cheltenham has had a voice since Victoria was on the throne, and we need to be reassured by the Minister that we will retain that voice as part of any devolution and local government reorganisation. Otherwise, power will simply be taken away from my community and given either to Gloucester or as far away as Bristol, with a new regional mayor. Can the Minister reassure me that localism will be part of his agenda too?
Jim McMahon
The hon. Member makes a fair point. We are clear in the White Paper that we want to see devolution rolled out at an ambitious pace. We are doing that, and are pleased with the responses that we have had. We want to see local government reorganisation because we believe that efficiencies can be drawn out and reinvested back into frontline services that people see, feel and value. We also accept that that cannot be at the cost of local people feeling connected and empowered in the places where they live. Local empowerment and powers for the local community are central to the White Paper, and to our agenda going forward.
Tom Gordon (Harrogate and Knaresborough) (LD)
My constituents in Harrogate and Knaresborough recently underwent local government reorganisation. As part of that, the North Yorkshire (Structural Changes) Order 2022 granted five years to develop a new North Yorkshire council-wide local plan. Work on local district plans halted to prioritise that new plan, which has now been compromised by the introduction of new housing targets under the national planning policy framework.
Will councils undergoing new rounds of local government reorganisation receive transitional arrangements, or will they fall into the same trap as Harrogate and Knaresborough and North Yorkshire, where speculative planning applications will see endless concreting over the green belt and issues with getting housing where we actually need it, rather than where we want it? Will the Minister meet me to discuss the legacy issues of that local government reorganisation, and outline what lessons have been learned from previous reorganisations?
Jim McMahon
The hon. Member is conflating two separate issues. One is the process of reorganisation, and his area of Harrogate has been through that process, including the postponement of elections to facilitate it. On housing development, if he wants to stop speculative development and to have control of what is built in local communities in Harrogate, the best way to achieve that is to have a plan in place where developers can be held to account.
Martin Wrigley (Newton Abbot) (LD)
I draw attention to my entry in the Register of Members’ Financial Interests.
Talking of localism, district councils provided a useful amount of local accountability. How will the Minister ensure that local accountability continues when the regional identity may be different? May I also ask about the future of towns and parishes, which are not mentioned at all, and neither are national park authorities? How will those be empowered to have more local responsibility?
Jim McMahon
The White Paper was directive on this issue. I can only assume the hon. Gentleman has not read it, or he got bored and gave up halfway through—I will leave him to answer that. Over quite a long period of time, councillors have been relegated to the back benches if they are not in the cabinet, and we do not believe that is right going forward. We want local councillors to be frontline councillors, community conveyors, leading in their local communities and getting things done. However we marshal the system—regardless of the size of the council, where it is, whether it is a unitary council in a met area or a reorganised council in a shire county—localism has to be at its heart.
Jim Shannon (Strangford) (DUP)
I thank the Minister for his answers to this urgent question. He is outlining a clear policy and strategy for the way forward, and we welcome that. The papers today are full of calls for debt cancellations for English councils, which do not provide much relief to those councils that have sought to stretch moneys and resources to make ends meet, rather than ramping up debt with vanity projects. How can the Minister ensure that reorganisation assists councils to prioritise people over policy?
Jim McMahon
I thought I was going to get a request to reorganise Newtownards—I have got enough on my plate with England! The point the hon. Gentleman makes about the treatment of debt is important, and we understand there are pressures. In most places, the treatment of accrued debt is manageable within the geography, but we accept there are outliers—Woking and Thurrock have been mentioned—where the debt that has been built up is significant and that we need to take a view on that. We are not at that stage yet until we see what proposal will be developed further.
Steff Aquarone (North Norfolk) (LD)
I refer the House to my entry in the Register of Members’ Financial Interests. There is a strong case for devolution in Norfolk. However, can the Minister confirm that holding elections in May does not prevent devolution for Norfolk, and would he agree that Norfolk’s voters should be allowed to have their say on who is taking forward our devolution negotiations?
Jim McMahon
We need to separate out that the devolution priority programme is one stream and the local government reorganisation programme is another. We are trying to bring those streams alongside each other, recognising that they are to a degree separate processes, so that at key points in the decision-making process, they come together to ensure transparency and clarity and so people know what timetable we are working to. I accept to a point that they can be decoupled, but the two are linked. If we are going to reorganise and move towards mayoral combined authorities, we have to bring them in line to ensure that it is a programme that makes sense in the round.
Alex Brewer (North East Hampshire) (LD)
People in North East Hampshire have told me loud and clear that they want their democratic right to vote in May. Given that councillors up for re-election were elected in May 2021, does the Minister think they still have a mandate to make decisions for their local communities?
Jim McMahon
If we decide to postpone the elections based on a credible plan that moves devolution and reorganisation along, the councillors who have their terms extended are legitimate and have the powers and rights of any other councillor. As I have said, we need to be careful that we do not undermine the democratic process by trying to portray councillors who believe in their communities and who by and large are doing a good job, regardless of party politics, as somehow not there by right. They have been elected; it just so happens that in some places their term will be extended by a short period.
Dr Al Pinkerton (Surrey Heath) (LD)
Residents in Surrey Heath face the prospect of cancelled elections, forced unitarisation and then forced amalgamation into a new western Surrey unitary authority, if the leader of Surrey county council gets his way. That western unitary authority would inherit £5 billion of debt. I am sure the Minister will agree that in seeking a new sense of identity for west surrey, a shared sense of bankruptcy was not what we were looking for, but that is the prospect we face. What would the Minister say to my residents, who played no part in accumulating that debt but who may in the future play a part in paying it off?
Jim McMahon
We have covered the hon. Member’s point about debt. Perhaps he has scars from coalitions of the past, but I suggest that now is a time to come together and put party interests to one side.
Health and Social Care: Winter Update
(3 days, 7 hours ago)
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The Secretary of State for Health and Social Care (Wes Streeting)
With permission, Madam Deputy Speaker, I would like to make a statement on winter pressures.
I start by saying that my thoughts, and I am sure the thoughts of the whole House, are with the nurse who was stabbed in a horrific attack at Royal Oldham hospital on Saturday. Nurses are the backbone of our NHS. They should be able to care for their patients without fear of abuse or violence. As she goes through treatment for her injuries, we pray for her speedy and full recovery and that she will be left to recover in peace.
I want to thank our NHS and social care staff for their remarkable effort, stamina and care in the most challenging of circumstances. Over the past few weeks, I have seen at first hand that staff are doing their level best in hospitals and care homes across our country—in the south-west, Essex, London, South Yorkshire and the north-west. Even when patients are left waiting far longer than they should be, and in conditions they should never be made to endure, they are still at pains to stress that the staff are doing their best.
I said on day one in this job that I would never gloss over problems in the health service and I would not pretend that everything is going well when it is not. The experience of patients this winter is unacceptable. I visited one A&E department over Christmas where I was told on the way in that I was lucky as I had come on a quiet day. Yet, as I walked through the hospital, I saw patients on trolleys lining the corridors where they were being treated, without the dignity or safety they should expect as a minimum. I saw frail elderly people on beds in the emergency department, many with dementia, crying out in pain and confusion because, ultimately, they were in the wrong place for their care needs. That was supposedly a good day.
The King’s Fund has said:
“The NHS is facing a toxic cocktail of pressures this winter”,
and it is right. Fourteen years of under-investment and a lack of effective reform have combined with a tidal wave of rising pressures. This has been the busiest year on record for our ambulance and accident and emergency services. We have had severe cold snaps, with temperatures as low as minus 15° in some parts of England. There are 5,100 patients in hospital beds with flu—more than three times the number at this point last year. Alongside the impact on patients, the rise in respiratory infections saw 53,000 NHS staff forced off work sick in the first week of the year. The result has been patients let down by ambulances that do not arrive on time, A&E departments that leave them waiting 12 hours or more, and the continued normalisation of corridor care. This is not the level of care staff want for their patients, and it is not the level of care this Government will ever accept for patients.
I said coming into this winter that 14 years of failure cannot be turned around in six months. It will take time to fix our broken NHS. Since July, we have done everything we can to prepare the NHS for winter. Following four months of silence from the previous Government, I called the British Medical Association on day one, met it in week one, and within three weeks negotiated a deal to end the junior doctors’ strike with a new deal for resident doctors. For the first winter in three years, staff are on the frontline, not the picket line. The Chancellor made immediate in-year investment in the NHS to fill the black hole we inherited and prevent us from having to cut back on services.
We have introduced the respiratory syncytial virus vaccine, and more than a million people and counting are protected against that virus. In total, 29 million vaccines have been delivered for flu, covid-19 and RSV, and more patients are protected against flu than at this stage last winter. If anyone is yet to get themselves vaccinated, it is not too late to protect themselves, their family and the NHS. They can check if they are eligible and book through their local GP or pharmacy.
We are working hand in hand with NHS England and care leaders, and I continue to meet regularly with senior leaders in social care, NHS England and the UK Health Security Agency. We have an excellent national operations centre running seven days a week. Its data allows us to zoom in—not just on individual hospitals but on individual patient waiting times—to respond in real time to spikes in pressures, and to manage threats as they emerge. The NHS is now using critical incidents proactively to focus minds and get the system responding to de-escalate and steer back to safer waters. I am happy to report that there is currently one live critical incident, down from 24 last week.
However, I do not pretend that that is good enough. It will take time to get back to the standards that patients deserve, but it can be done. That will require a big shift in the focus of healthcare—out of the hospital and into the community—to free up beds for emergency patients and to prevent people from having to call an ambulance or go to A&E in the first place. That is the reform agenda that the Government are enacting.
In recent weeks, we have announced steps to begin rebuilding general practice, and immediate and long-term action in social care. When we came into office, we inherited a situation in which qualified GPs could not get a job, while patients could not get a GP. That is why, within weeks, I found just shy of £100 million to recruit 1,000 more GPs by April. We have recruited hundreds of GPs to the frontline already, and we will recruit hundreds more in the months to come. We have announced an extra £889 million in funding for general practice, which is the biggest funding uplift in years, alongside a package of reforms to bust bureaucracy, slash unnecessary targets and give GPs more time to spend with their patients—our first step towards bringing back the family doctor.
Ten days ago, I visited a care home in Carlisle that was offering intermediate step-down care for NHS hospitals. It was able to give patients en suite bathroom facilities in care homes, with rehab, all at half the price it was costing the taxpayer to keep patients in a hospital bed up the road. That is better for patients and less expensive for taxpayers. Yet there are 12,000 patients in hospital beds today who do not need to be there but cannot be discharged because appropriate care is not available. That is why the Government are making up to £3.7 billion of extra funding available for local authorities that provide social care. It is why we are delivering an extra 7,800 home adaptations through the disabled facilities grant this year and next year. It is why we have delivered the biggest increase in carer’s allowance since the 1970s, worth an extra £2,300 to family carers. It is why are introducing fair-pay agreements to tackle the 131,000 vacancies in social care. And it is why we have appointed Baroness Louise Casey to help build a national consensus on the long-term solutions for social care.
From visiting emergency departments, monitoring the performance of the NHS over this winter and noting the variation in performance across the country, I know that we can clearly get our ambulance and A&E services working better. Before the spring, we will set out the lessons learned from this winter and the improvements that we will put in place ahead of next winter.
Finally, let me be clear on corridor care, which became normalised in NHS hospitals under the previous Government: I will never accept or tolerate patients being treated in corridors. It is unsafe, undignified and a cruel consequence of 14 years of failure on the NHS, and I am determined to consign it to the history books. I cannot and will not promise that patients will not be treated in corridors next year. It will take time to undo the damage that has been done to our NHS, but that is this Government’s ambition.
Annual winter pressures should not automatically lead to an annual winter crisis—indeed, there were no annual winter crises by the end of the previous Labour Government. That is why this Government are investing an extra £26 billion in our health and care services, and undertaking the fundamental reform that both services need. That will take time, but we will deliver an NHS and a national care service that provide people with care where and when they need it. I commend this statement to the House.
Madam Deputy Speaker (Judith Cummins)
I call the shadow Secretary of State.
Edward Argar (Melton and Syston) (Con)
As ever, I am grateful to the Secretary of State for his typical courtesy in giving me advance sight of his statement. May I join him in saying that our thoughts are with the nurse in Oldham who was so viciously attacked? Like him, we wish her a full and speedy recovery. May I also echo his words of gratitude to NHS and social care staff for all they do to help and support patients and our constituents?
We last heard from Ministers on winter pressures just before Christmas. Yet, as the Secretary of State has set out, the situation has continued to grow more severe. We have all heard about those pressures in the media and from patients, constituents and staff. Indeed, I will take this opportunity to acknowledge the work of the hon. Member for Tooting (Dr Allin-Khan), who I know has been on the frontline and has, I suspect, seen those pressures—the unacceptably long waits in A&Es for ambulances, and corridor care and its impact on patients—at first hand. When someone calls an ambulance, they need to know that it will come, but it cannot if it is sitting in a hospital car park. At my local hospital in Leicester, for example, over 36% of ambulances handing over had a one hour-plus wait, and I am sure that that is replicated around the country.
The Secretary of State highlights that the number of patients in hospital with flu is triple what it was a year ago, yet it appears that the rate of flu vaccine uptake for over-65s, at-risk groups and healthcare workers is lower than last year. He wants more people to be vaccinated, and I share that view, but will he set out in more detail what he is doing to further drive vaccine rates and ensure that vaccines are available for all those who need and want them?
As the Secretary of State said, more than two dozen hospitals declared critical incidents last week. Although I welcome the fact that the vast bulk of those incidents have been stood down, will he set out what support and additional resource is being offered not only to hospitals that have reached the point of declaring critical incidents, but to others that continue to face pressures?
Last year, the Government provided additional funding for hospitals and social care to boost capacity and, vitally, the number of beds in hospitals, as well as to tackle delayed discharges. Will the Secretary of State set out in more detail what he is doing in a similar vein? Will he update the House on how many people currently in acute settings are fit for discharge but have not been discharged for a variety of reasons?
The Secretary of State mentioned pay, and said that he had negotiated a deal. I say gently to him that what he did was not negotiation but capitulation to an inflation-busting pay rise.
None of these pressures comes as a surprise to me or to the Secretary of State. He was open and candid, as he often is, in acknowledging that there would be a winter crisis this year. NHS England directors were warning that they did not have the resources needed to surge capacity or increase social care packages now, which the Conservative Government provided in previous years. The royal colleges said that nothing had been done to mitigate a winter crisis, and NHS organisations said that they needed more support to prevent ambulance delays, overcrowded A&Es and people being stuck in hospital beds because of a lack of community and social care. He knows—we have spoken about it before—the importance of flow from ambulance to A&E, and from A&E to a bed or to discharge. What extra steps is he taking to increase the number of care packages now rather than in the future, and will he consider allowing community hospitals, such as mine in Melton Mowbray, to play a greater role in providing care to local communities in order to ease pressure on acute settings?
Those concerns were all raised in September and October. My predecessor as shadow Secretary of State, my right hon. Friend the Member for Louth and Horncastle (Victoria Atkins), asked about them, yet the Secretary of State failed to provide an update to the House until Ministers came to the House just before Christmas. Indeed, I recently asked a named day question about when the Secretary of State started chairing his weekly winter preparedness meetings. Despite, one hopes, a quick look at his diary giving the answer, I received a holding answer. I only got the correct answer after that holding answer had been sent to me, stating that it was in December. Can he say on which date in December the first of those meetings was held?
Before Christmas, I and the Conservatives called for a winter-specific bed increase plan. We still have not had one. Will the Secretary of State set out what he is doing to increase the number of beds and the amount of capacity now?
While the Secretary of State talks the talk, he has not done the work ahead of this winter. Will he now reassure patients and staff that he will urgently boost capacity, resources and support to ensure our constituents get the care they need when they need it?
Wes Streeting
Where to begin, Madam Deputy Speaker? The shadow Health Secretary does a really good line in diagnosing the problem as if these are somehow new facts to him, or to the country. In fact, one does not have to be a Minister of long service in this House, or indeed a Member of long service, to remember that only a short matter of months ago, the shadow Secretary of State was a Minister in the Department. Time and again, he asks questions about the state of the crisis and the challenge in the NHS without showing a shred of responsibility for that crisis, which he played a part in creating.
It is not just the shadow Secretary of State but every one of his predecessors who had a hand in creating the situation that Lord Darzi spelled out: underinvestment and botched reform. It is the situation we see today, with pretty much every part of our health and care services—be it primary care, community care, mental health services, secondary care or social care—under extraordinary and historic pressures. It is all very well criticising from the Opposition Benches, but the shadow Secretary of State demonstrates the same pattern of behaviour as his predecessor: acting like the arsonist criticising the fire brigade for not doing enough, quickly enough, to put out the fire they started. It is truly shameful.
I turn to the questions raised by the shadow Secretary of State. On delayed discharges, in December—the latest data we have—12,000 on average per day were medically fit for discharge but unable to be discharged. Bed numbers are broadly the same as they were this time last year: 102,546, versus 102,226 under the previous Government. That actually says something about what we have experienced in our weekly updates: the work that is taking place between health and social care services to improve the flow of patients is having some effect when we take into account our ability to flex bed numbers up and down against the backdrop of higher occupancy from flu, the added challenge of norovirus, and the other seasonal conditions that we see at this time of year.
The shadow Secretary of State asked about vaccination uptake. As I said in my statement, there have been more flu vaccinations this year than there were last year, but he raised the important issue of vaccination rates among NHS staff. Those rates are lower than we would like or expect, and we have to do some work with staff to understand why that is the case and how we can encourage further uptake. As I said, if staff are suffering with flu having not been vaccinated, not only is that a really unpleasant experience for them, it is an unpleasant experience for their colleagues if staff are off sick, and indeed for patients who are waiting longer.
On critical incidents, the shadow Secretary of State asked about the support that is being provided to NHS organisations. NHS England regional teams are working closely with integrated care boards to ensure appropriate responses are in place to address and mitigate the issues identified within each declared critical incident, all of which will have variations. We have also seen NHS England—rightly, in my view—using the critical incident tool proactively to ensure we can provide wider system support to emergency departments that are under particular pressure.
The shadow Secretary of State asked about additional funding for winter. When I was shadow Health and Social Care Secretary, I was very clear about my cynicism regarding the pattern of behaviour we saw from our predecessors. Year after year, they would arrive in the middle of winter—often after the winter peak—with a gimmicky package of last-minute funding that delivered too little, too late without making any real difference on the frontline, all to give the impression that they were doing something to mitigate the crisis in the NHS, in which they played a serious part. I said that we would not do that, and we are not doing it. As soon as we came into office, looked at the books and saw the black hole, the Chancellor released additional funding for the NHS in-year to ensure that it had the resources it needed not to cut back. Thanks to the decisions taken by the Chancellor, the NHS has received more than £2 billion more in-year than it would have received if the Conservatives had remained in power, so we do not need any lectures on funding. Indeed, they continue to oppose the £26 billion we provided for the NHS.
Finally, the shadow Secretary of State accuses us of capitulation to frontline doctors who were out on strike because of the way they were treated by our Conservative predecessors. I just say to resident doctors who are following these proceedings, and to patients who can see the state of the NHS today and wish it were better, that we are now left in no doubt. Had the country kept the Conservatives in power, doctors would have been on the picket lines instead of the frontlines this winter; taxpayers would have continued to pay a heavy price for failure; and patients would continue to pay the price through delayed, rearranged or cancelled operations, appointments and procedures. It is proof positive that even after it was booted out of office, the Conservative party has not listened, has not learned, and is not fit to govern.
Dr Rosena Allin-Khan (Tooting) (Lab)
For years, like many in this House, I have seen a regular stream of local people in my surgeries and inbox who have been waiting far too long for NHS treatment. What shocks me the most, though, is when I see the same local people turn up in A&E when I am doing my shifts, having deteriorated and in even worse pain than before. Locally, there are 66,000 cases of people who have had to wait over 18 weeks for treatment, so does my colleague the Secretary of State agree that we need an urgent and emergency care plan to deliver much-needed year-on-year improvements?
Wes Streeting
I wholeheartedly agree with my hon. Friend, and thank her for the work she has been doing this winter on the NHS frontline, providing support to her colleagues at her local hospital—literally rolling her sleeves up and looking after people. She is absolutely right that we need an urgent and emergency care plan to make sure we see continued year-on-year improvements. I can reassure my hon. Friend that that plan is already being written; we are learning the lessons from this winter in order to apply them next winter. As I should have said to the shadow Secretary of State, the right hon. Member for Melton and Syston (Edward Argar), I took the same approach when I was shadow Secretary of State: the very first meetings I held on winter planning were ahead of the general election in access talks with the Department. The first briefing I received on winter preparation was on my first day in office. Throughout the past six months heading into winter, I continued to talk to staff in the Department, NHS England and social care leaders to ensure that we were as well prepared for this winter as we could be. Right now, we are learning the lessons to prepare for next winter.
Madam Deputy Speaker (Judith Cummins)
I call the Liberal Democrat spokesperson.
Helen Morgan (North Shropshire) (LD)
I associate myself with the comments of the Secretary of State and the shadow Secretary of State regarding the abhorrent attack in Oldham.
The pressure on our hospitals this winter brutally demonstrates the scale of action needed after years of Conservative neglect of the NHS. Across England last month, 71% of A&E patients were seen within four hours, but that statistic varies wildly depending on where one happens to live. At Shrewsbury and Telford emergency departments last month, ambulances had to wait an average of over two hours to hand over their patients. Just 50% of patients were seen within four hours, and nearly 1,500 patients were left stuck on a trolley for more than 12 hours.
Statistics like these often fail to have much impact now, because we have heard them so regularly—particularly since winter crises have become normalised—but it is very important that we consider who is behind them. It is patients such as my constituent Emma, who having been diagnosed with sepsis spent 48 hours in a fit-to-sit area and then 12 hours on a trolley in an X-ray corridor before finally being admitted, alongside a horrifying delay in the medication required to deal with her life-threatening condition. Yet we often have to wait weeks for data that fully explains what is happening in our hospitals, and no official data is collected about the number of critical incidents. This leaves patients potentially ill-informed, and it makes scrutiny and support in this place, in particular, difficult to provide.
Will the Secretary of State commit to introducing faster and more detailed reporting about the live state of play in our emergency departments, including the number of critical incidents and the temporary escalation spaces, and give a timeline for reporting that information? Will he publish information that shows the impact that delays are having—for example, by looking at the number of deaths in emergency departments—and will he act on the long-term Liberal Democrat request to publish localised data on ambulance delays so that support is provided in areas, such as Shropshire, where it is most needed?
Wes Streeting
I thank the Liberal Democrat spokesperson for her usual constructive contribution to proceedings. She is absolutely right to raise the issue of variation in performance across different parts of the country. It is not acceptable, and one thing we will be doing as a Government is to ensure that, as well as creating a rising tide that lifts all ships, we raise the floor in performance so that we see far less unwarranted and unwanted regional variation. She talked about the Shrewsbury and Telford trust, which has had a number of challenges over many years. We have seen some signs of improvement as recently as this week, and we continue to support local leaders as they strive to improve the performance of their system overall.
The hon. Member raises some good and interesting questions about the frequency with which we publish data. It is right that we ensure that data is properly validated so that accurate data is put into the public domain, even as NHS England’s control room monitors live reporting into the centre. I will take into account what she said about her requests both for more live data—collected and published data—about critical incidents and for more localised data in individual trusts, including ambulance services, to monitor variations in response times within a region. Although the points she has raised are interesting, I add the caveat that we would not want to burden the system with more reporting requirements if that causes a distraction from improvement. I tend to lean towards more transparency in data and reporting, however, and I will take into account the representations she has made as we put together our urgent and emergency care plan.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
At the Victoria hospital in Kirkcaldy, paramedics have had to establish a makeshift ward outside as ambulances queue up outside A&E. The number of people presenting in December 2024 was roughly the same as in December 2019, but there has been an increase of almost 300% in those waiting over four hours at A&E. Does the Secretary of State agree that this is a dreadful indictment of 18 years of SNP rule in Scotland, and that the SNP Government must use some of the additional £4.9 billion from the UK Labour Budget to get a grip? My constituents deserve so much better than this.
Wes Streeting
I thank my hon. Friend for that question. The conditions she describes at her local hospital are truly shocking. As I have said, and this is often quoted by the SNP, all roads lead to Westminster, and I am happy to report that up that road from Westminster to Holyrood lies a record uplift in funding for the Scottish Government. They have no excuses for inaction. They need to grip the crisis in the NHS in Scotland, as we are here. The difference, as my hon. Friend states, is that they have a record of 18 years that they cannot defend, and I hope people will consider that record very carefully when they decide who should govern in Scotland at the next set of Scottish elections.
Madam Deputy Speaker (Judith Cummins)
I call the Chair of the Health and Social Care Committee.
Layla Moran (Oxford West and Abingdon) (LD)
May I press the Secretary of State on that data point? It is not just the Liberal Democrats making these representations; the Royal College of Nursing, the Royal College of Physicians, the Royal College of Emergency Medicine, HealthWatch, the British Medical Association, Age UK and many others also want the data. This matters, because the situation causes moral injury to staff and compromises patient safety—and the problem is not just corridor care; it encroaches on to other wards. Will the Secretary of State commit to releasing that data before the NHS England board meeting on 4 February? In addition, what assessment has he made of the impact of this winter on less urgent care, and on elective waiting lists?
Wes Streeting
I am grateful to the Chair of the Select Committee for her questions. I cannot give her a commitment to publish those statistics ahead of the next NHS England board, but I can give her an undertaking to go away and look carefully at the rhythm and pace at which we publish performance data, to make sure that we are being as transparent as we can, as fast as we can. That, I think, should be the principle that underpins our approach to the publication of data. She is right to talk about wider system pressures as a result of what we see in emergency departments. We will wait to review the performance of the NHS overall until we exit winter. I think we have seen some effective protection of elective activity throughout this winter, but that will of course vary from provider to provider.
The hon. Member mentioned a whole number of organisations calling for more data transparency. I, too, welcome the very public representations that we have heard from the Royal College of Emergency Medicine and others about the need to tackle corridor care. Let me assure her and all those who have made representations that we are absolutely determined to turn this situation around, and not just improve the performance of urgent and emergency care, but get a better system working. Ultimately, it is through ensuring better patient flows, and ensuring that people get the right care in the right place at the right time, that we will finally get this country out of the cycle, created by our Conservative predecessors, of winter crises.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
Order. Members will be aware that we have pressure on time today, so I will finish this statement at around 3.15 pm.
Rachael Maskell (York Central) (Lab/Co-op)
Triaging patients into virtual wards will not only protect the front door of the NHS, but be far better for patients. What is the Secretary of State doing to hold integrated care boards to account and ensure that they are putting money into primary care, as opposed to where everyone always looks, which is secondary care?
Wes Streeting
That is an excellent question from my hon. Friend. This Government have been walking the talk on primary care since we came into office. There was an immediate release of funding, within weeks, for 1,000 GPs, who are to be employed on the frontline by this April, and an £889 million uplift in funding for general practice that we announced prior to Christmas. I think that care in the home and care closer to home will be how we not only get the NHS back on its feet, but make sure it is fit for the future. That shift from hospital to community is one of the three big shifts that will lie at the heart of our 10-year plan for the national health service.
Joe Robertson (Isle of Wight East) (Con)
The Secretary of State referred to social care in his update on winter pressures, and he is of course right that social care has an important role to play in taking pressure off hospitals. However, surely he can understand the frustration that the sector and those in receipt of social care feel about his pushing the issue into a three-year review, which Sir Andrew Dilnot says is an inappropriately long time. Why will it take so long? Please can he put pressure on the review? I am sure that Baroness Casey is well capable of doing it in a shorter time.
Wes Streeting
I am happy to report that people will not have to wait three years for action on social care. In fact, we have seen lots of it in the last six months. We have had the biggest expansion of carer’s allowance since the 1970s; the legislation for fair pay agreements in the Employment Rights Bill, brought in within the first 100 days of this Government; the uplift in funding provided by the Chancellor through her Budget; and the expansion of the disabled facilities grant. There will be more for us to do this year, including reform to make the better care fund more effective. Baroness Casey’s first report will in fact be next year. It will set out the action required on social care throughout this Parliament. I hope that reassures people right across the House and, more importantly, right across the country that social care is a priority for this Government. We will seek to do better than our predecessors of all parties—I have made this point before—because we have to tackle this generational challenge facing our country.
Deirdre Costigan (Ealing Southall) (Lab)
I was shocked when a young man came to my last constituency surgery to ask me as his MP to help him get a GP appointment. Morning after morning, he had spent hours queuing on the phone, and he was desperate. If my constituents cannot see a GP, they end up in A&E instead. How is the Secretary of State continuing to work to undo the Conservatives’ abject failure to fix the GP crisis, which is fuelling winter pressure on hospitals?
Wes Streeting
My hon. Friend is absolutely right about the challenge caused by the Conservatives’ failure on general practice, which has placed pressure not just on stretched GPs, of whom there were thousands fewer when the Conservatives left office than in 2015, but on other parts of the system. That is not just worse for patients—it is certainly not a pleasant experience at the moment to be sat waiting in A&E for treatment—but more expensive for the taxpayer, because while it costs £40 for a doctor’s appointment, it can cost £400 for accident and emergency attendance. That is the legacy of the Conservative Government: things are worse for patients and more expensive for taxpayers. That is the rotten legacy that we are seeking to overturn.
Greg Smith (Mid Buckinghamshire) (Con)
Last week, the UK Health Security Agency warned of elderly people suffering from heart attacks, strokes and chest infections as a result of the recent severe cold weather. Is the Secretary of State any closer to admitting that taking away the winter fuel payment from some of our most vulnerable pensioners was not just cruel, but life threatening?
Wes Streeting
It is irresponsible, as well as inaccurate, to suggest that the Government have taken winter fuel payments away from vulnerable pensioners. In fact, it is thanks to the decisions taken by the Chancellor that winter fuel payments were protected for the poorest pensioners. They continue to be worth £200 to eligible households, or £300 to eligible households in which there is someone aged 80 or over. We also continue to stand behind vulnerable households by delivering the £150 warm home discount for low-income households and providing £742 million to enable the extension of the household support fund. Of course, over 12 million pensioners will see their basic or new state pension increase by 4.1%, thanks to the Government’s commitment to the triple lock.
This is a running theme from Conservative Members. They seem to welcome the investment in health and social care that the Government are providing at the same time as opposing it. They cannot have it both ways. If they do not support the decisions taken by the Chancellor, they have to admit that had the Conservatives remained in power, this winter, they would have been cutting the health and social care services that pensioners really rely on.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
May I ask Members to keep their questions and answers sharp, please?
Mrs Sharon Hodgson (Washington and Gateshead South) (Lab)
Under the last Conservative Government, strikes cost the taxpayer millions of pounds and 1.5 million appointments were cancelled, so may I thank the Secretary of State sincerely for making it his day one priority to sort that out? He called the junior doctors and found a deal within three weeks, ending the strikes. All of us across the House thank him for sorting that out. For the first winter in three years, staff will be on the frontline, not the picket line, as the Secretary of State so rightly said. Does he agree that that is just one example of what Labour Governments do in office? We always have a laser focus on making the NHS better, unlike the Conservatives, who seem to have a laser focus on making it fail.
Wes Streeting
I strongly agree with my hon. Friend. The way that Conservative Members continue to behave should send a message to every resident doctor, and indeed every member of health and social care staff, in the country. Every single one of them will know that thanks to the decision the country took back in July, we have a Government who are committed to the NHS and social care. Had the Conservatives remained in power, we would be going even deeper into the already deep hole that they left the country in. We must never go back there again.
Andrew George (St Ives) (LD)
I accept that the Government are clearly not the architect of the current unacceptable state of affairs. However, may I encourage the Secretary of State to reflect again on our exchange at the Health and Social Care Committee just a month ago, when he resisted the recommendation of the president of the Royal College of Emergency Medicine that we invest in more beds to accommodate additional admissions to hospital? That would ease a return to normality, reduce the need for corridor care, and ease the pressures in emergency departments.
Wes Streeting
Throughout the winter, NHS providers have continued to flex bed capacity to meet demand. The important thing is that our approach to investment and reform delivers the system-wide improvements that help us to break out of the annual cycle of winter crises. There has been criticism of the Government’s focus on elective recovery—for example, people have asked if that is at the expense of urgent and emergency care—but I will not allow a status quo to settle in which the NHS is in effect reduced to a blue-light, emergency service. The Government will improve urgent and emergency care, elective recovery, primary care, community services and social care, because that is what we need to meet the health and care needs of people in this century, and that is what we will deliver.
Peter Prinsley (Bury St Edmunds and Stowmarket) (Lab)
Winter pressures have caused the cancellation of thousands of operations, including many of my own lists. Does the Secretary of State agree that the opening of the dedicated Clare Marx surgical centre in Colchester, serving patients in Essex and Suffolk, is an extremely welcome development?
Wes Streeting
I thank my hon. Friend for his question, and for the expertise and experience that he brings to the House. We absolutely need to ensure that we are innovating in our service provision, and are shifting the centre of gravity out of hospitals and towards care and treatment closer to home—indeed, in people’s homes. As we have set out in recent weeks, since the investment announced in the Budget and particularly in the elective reform plan, this Government will continue to innovate, in order to provide services that deliver not only great value for the taxpayer but, even more importantly, great outcomes for patients.
Nick Timothy (West Suffolk) (Con)
Research shows that ambulance response times in Haverhill in my constituency are twice those in Cambridge. We would like a new, co-located and purpose-built blue-light facility; the police and the ambulance service could use it to serve the town effectively, and it would hopefully save money. May I invite a Minister from the Department to come to Haverhill to meet me, the East of England ambulance service, Suffolk police and local councillors to discuss those plans?
Wes Streeting
I confirm that we are absolutely up for looking at co-location of different public services, to deliver both better integration and co-operation between different services—particularly the blue-light services that the hon. Gentleman mentioned—and better value for taxpayers. I will ensure that one of my ministerial colleagues makes contact with him.
Preet Kaur Gill (Birmingham Edgbaston) (Lab/Co-op)
The Health Secretary will know that University Hospitals Birmingham in my constituency recently declared a critical incident, which I am pleased has now been stepped down. Does he share my view that shifting the focus of healthcare from hospital to community as we rebuild our NHS would have a consequential impact on the number of people in hospitals, which are under immense pressure?
Wes Streeting
My hon. Friend is absolutely right. May I, through her, thank health and care staff in her city for the work they are doing to get the people of Birmingham through this particularly challenging winter? What we really need to do to make our health and care system more effective and more sustainable is shift the centre of gravity out of hospital and into the community. We need better and faster access to diagnostics and treatment, as well as a bigger focus on prevention—primary prevention to keep us all healthy and active, and secondary prevention so that fewer people need to call on health services, and particularly emergency departments, which are stretched at this time of year.
Sarah Olney (Richmond Park) (LD)
I was pleased to hear what the Secretary of State said about vaccine roll-out, particularly of the RSV vaccine. I am even more pleased that my constituents in Richmond Park are diligent in taking up all vaccines, but they have been puzzled to find that the RSV vaccine is limited to those between 75 and 79 years of age. What plans are there are to extend the roll-out to those aged 80 and above?
Wes Streeting
I am grateful to the hon. Member for her question and for showing off her constituents’ uptake—that is exactly what we want. Perhaps ahead of next winter, we should launch a parliamentary competition: who can boost uptake most in their constituencies? We will think about the prize.
More seriously, I am always glad when the pressure is to expand access to vaccines—that is exactly the sort of pressure that we want. We follow advice from the Joint Committee on Vaccination and Immunisation. We will review the experience this winter, and the JCVI will review evidence and data this winter and make recommendations, which we will take into account.
Alistair Strathern (Hitchin) (Lab)
The dire state that the last Government left the NHS in was all too apparent, tragically, to many of my constituents who needed it last winter. My 85-year-old constituent admitted with breathing difficulties had to wait over 30 hours in a chair because there were no beds available, and they were far from alone in that indignity and prolonged suffering. They should not have to tolerate it, and I certainly will not as their MP. I welcome this Government’s action and leadership on ending the doctors’ strike and investing in more appointments, but what more will the Secretary of State do to ensure that, next winter, many more of my constituents are not suffering from the same challenges?
Wes Streeting
I am extremely grateful to my hon. Friend for the spirit of his question. That is exactly how this Government are approaching planning for next winter. I want year-on-year improvement in NHS performance, particularly our response to winter pressures. Of course, there are seasonal variations in infectious diseases, inclement weather and all sorts of other pressures that can impact on NHS services, but the system should be resilient enough to withstand pressures in any given winter. It will take time to get back there, but that is why the Government are already planning for next winter, learning from experience—what has worked well and what has not—so that we can continue to deliver for the people of this country and improve the national health service and social care services.
Mr Joshua Reynolds (Maidenhead) (LD)
One thing we could do to improve the situation in Maidenhead is to reopen the walk-in urgent care centre at St Mark’s hospital so that we can keep people out of the big hospitals and A&E and, as the Secretary of State said, help people get care closer to home. Will he meet me to discuss how we can work together to get the walk-in urgent care centre at St Mark’s back open?
Wes Streeting
I welcome the hon. Member’s question, and I agree with the thrust of his question that we need healthcare to shift from hospital into the community, with care closer to, and in, people’s homes. The configuration of services locally is a matter for local NHS leaders. I encourage him in the first instance to be in touch with his local integrated care board. If he gets a particularly unsatisfactory or unreasonable answer, he should feel free to raise it with Ministers.
Kevin McKenna (Sittingbourne and Sheppey) (Lab)
I associate myself with the comments about the nursing colleague who was so brutally attacked in Oldham. I am thinking of her and her team at this time.
I have been thinking back to when I was starting out as a junior nurse. We faced the same problem—it was just after Labour had taken over from a Conservative Government, and the backwash of winter crises caused by that failed Government was very similar in the first few years. Improving staff pay and the NHS plan made a difference. What else has my right hon. Gentleman learned from the successes of his forebears about tackling this winter crisis now and tackling such crises in future?
Wes Streeting
My hon. Friend brings expertise and experience to the House, and I am particularly grateful for his support and concern for the colleagues of the nurse who was so brutally attacked in Oldham, because I know that they will be acutely affected. In fact, the NHS workforce right across the country will have felt the shiver down the spine that I felt when I read about that horrific case.
My hon. Friend is right that I am fortunate to be able to call on every single one of my Labour predecessors, from Alan Milburn to Andy Burnham, to ask for their advice, experience and insight. As our great late friend John Prescott said, we need
“traditional values in a modern setting”.
I am bringing that modernising tradition to our approach to investment and reform, because the combination of both delivers results. That is how the last Labour Government delivered the shortest waiting times and the highest patient satisfaction in history.
Lisa Smart (Hazel Grove) (LD)
The Secretary of State will know that Stepping Hill hospital in Hazel Grove has a repairs backlog reported to be £130 million. That means that local teams at Stepping Hill are under even more pressure to tackle the winter crisis. His colleague the Minister for Secondary Care, the hon. Member for Bristol South (Karin Smyth), wrote to me and my constituency neighbour, my hon. Friend the Member for Cheadle (Mr Morrison), in October to agree that she was deeply concerned about the condition of healthcare infrastructure at the hospital. Following the Budget, when should we expect clarity on funding per hospital so that my constituents and Stepping Hill patients get the hospital that they deserve?
Wes Streeting
I am grateful to the hon. Member for raising those concerns on the Floor of the House. Thanks to the decisions that the Chancellor took in the Budget, the Department has an additional £26 billion available for investment in our health and social care services, including estates. I cannot promise to fix the backlog that has built up over the past 14 years in a single budget year, but I can confirm that we will publish our mandate for NHS England and, following that, planning guidance and financial allocations, very shortly.
Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)
Under the Tories’ watch, our NHS became in danger of normalising failure, with patients treated in corridors, horrendous A&E waits and hospitals at risk of being gridlocked as they struggle to discharge patients. Will the Secretary of State continue to be up front and open about the challenges, and ensure that the NHS recovers year on year under his watch?
Wes Streeting
When I was sitting on the Opposition Benches at the tail end of the last Parliament, I saw my predecessor at this Dispatch Box telling us all the wonderful things that she thought the Government were doing and achieving. It was like hearing about a completely different national health service and social care system in another country. I arrived in July and was honest on day one that the NHS is broken but not beaten, and that these are crises of historic proportions that we will never sweep under the carpet, nor will we hide problems to spare political blushes. In the coming months and years, I will continue to be honest about where we have not yet fixed problems, and clear about the action that we are taking to get the NHS back on its feet and fit for the future and to build a national care service worthy of the name.
Richard Tice (Boston and Skegness) (Reform)
I think we all share the Secretary of State’s aspiration to move healthcare out of hospitals and into the community. However, the two GP surgeries that I visited in Skegness just before Christmas are concerned that the impact of the national insurance increases on their staffing budgets will be around £100,000 per surgery, which will force them to reduce staffing capacity and, therefore, appointment capacity. What will the Secretary of State do to help those GP surgeries in that situation? There seems to be a conflict between the sensible aspiration and the practical reality.
Wes Streeting
There are 889 million reasons why GPs should be reassured about their financial sustainability for the year ahead—the £889 million allocation for general practice that I spelled out before Christmas, to provide reassurance to GPs when planning for the financial year ahead. I have been heartened by the response from GPs to that announcement, and I gently say to people who criticise the means of raising it that without the decisions that the Chancellor took in the Budget, we would not be able to invest £26 billion in our health and care services. We cannot have people welcoming the investment but criticising the means of raising it. If people do not support the Chancellor’s decision—a perfectly reasonable political position to take—they will have to spell out what services they would cut or what taxes they would raise.
Laurence Turner (Birmingham Northfield) (Lab)
I echo the Secretary of State’s comments and those of my hon. Friend the Member for Birmingham Edgbaston (Preet Kaur Gill) on recognising the endeavours of health and care staff during last week’s extremely difficult critical incidents, and I also recognise the effect of contingency planning that had taken place, including the provision of additional beds at West Heath hospital in my constituency.
With respect to the central support the Secretary of State referred to, is he willing to make summaries of the support provided by NHS England to local trusts this year and in previous years?
Wes Streeting
I would be very happy to write to my hon. Friend to set out the support provided by NHS England to health and care services for his community, and I would be delighted to receive via him feedback from his health and care providers about what Government support they would like next winter and in future years.
Clive Jones (Wokingham) (LD)
I declare my interest as a governor of the Royal Berkshire hospital, and I have a family member who has shares in a medical company.
The Secretary of State has a really tough job of clearing up the mess left in the NHS by the Conservatives, but some of the Royal Berkshire hospital estate is not fit for purpose and especially not fit to cope with the winter crisis. Can he confirm that a proper level of funding will be available to rebuild the Royal Berkshire hospital and that there will be no increase in the seven-year delay announced by the Conservatives in April this year? That will help with future winter crises.
Wes Streeting
I will take that as another representation from the hon. Gentleman on the new hospital programme, and I reassure him we will be setting out our review and its conclusions shortly.
Sally Jameson (Doncaster Central) (Lab/Co-op)
As part of making the NHS fit for the future, moving some patient care from hospital to the community will be pivotal. In Doncaster, mayor Ros Jones and the council are already well on the way with this and they are setting up “Health on the High Street”, which is good not just for patients but for footfall in the city centre. Will my right hon. Friend set out what his Department is doing to support areas such as Doncaster in delivering on this strategy?
Wes Streeting
I am delighted to hear of the work Ros is doing as mayor to support health and care services and to take health and care to where people are. I hate hearing that there are hard-to-reach communities; there are no hard-to-reach communities. There are underserved communities and, in our determination to tackle health inequalities, to get care closer to people’s homes and indeed in people’s homes, to do earlier diagnosis and to provide faster access to treatment, we need to make sure that we take health and care services to where people are rather than expecting people to always come to us.
Alison Bennett (Mid Sussex) (LD)
I fear that corridor care has already become normalised and, as the Secretary of State says, it will be some time before we get back on the right path. This week there have been reports of a north London hospital advertising for dedicated corridor care nurses. I also think about my constituent who is a doctor at the Royal Sussex begging X-ray teams to give her a consultation room so she does not have to do intimate exams out in the corridor. What reassurance can the Secretary of State give the NHS workforce that things are going to get better?
Wes Streeting
I am really grateful to the hon. Member for raising that question and for the example she gave of the Whittington advertisement for staff specifically to deliver corridor care. I make no criticism of the trust itself in trying to make sure it has the right staff in place to deliver the best care possible in the present circumstances. It is not the fault of the Whittington that there is corridor care; it is a legacy of 14 years of Conservative failure. I would also say that my reaction to seeing that advertisement was the same as hers: it was proof that corridor care has been normalised. I want to reassure her, the House and patients across the country that this Government will not accept corridor care as normal care. We will not tolerate it as being acceptable care. We will do everything we can as fast as we can to consign corridor care to the history books and I reassure the staff working in the NHS in these intolerable conditions that we will work with them to deliver the investment and the reform needed to get the NHS back on its feet and make it fit for the future.
Mr Richard Quigley (Isle of Wight West) (Lab)
Despite the Conservative party’s best efforts to ruin our NHS, will the Secretary of State join me in paying tribute to the hard-working NHS and social care staff in my constituency who, despite enormous winter pressure, are doing their best to go above and beyond to provide exceptional care and keep the NHS on its feet?
Wes Streeting
I thank staff on the Isle of Wight for everything they are doing to support communities across the island against a challenging backdrop. Since my hon. Friend arrived in the House he has been an extremely strong, loud and effective voice for the people of his constituency and across the Isle of Wight, and I look forward to working with him and health and care leaders on the Isle of Wight to make sure that they see their health and care services improving as a result of their decision to send a Labour Member of Parliament and a Labour Government here to serve our NHS and his communities.
Higher Education Regulatory Approach
(3 days, 7 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
The Secretary of State for Education (Bridget Phillipson)
With permission, I shall make a statement on the Higher Education (Freedom of Speech) Act 2023.
In July 2024 I paused further commencement of the Act in response to concerns raised by a cross-section of voices. I took that decision because it is vital that we get this right. Our universities are one of this country’s greatest strengths, and I know Members across the House share my pride in a truly world-leading sector. At the centre of that excellence sit academic freedom and freedom of speech. The ability of our academics to explore and express new ideas through teaching and research is precious and we must protect it.
These fundamental freedoms are more important—much more important—than the wishes of some students not to be offended. University is a place for ideas to be exposed and debated, to be tried and tested. For young people, it is a space for horizons to be broadened, perspectives to be challenged and ideas to be examined. It is not a place for students to shut down any view with which they disagree.
Here is our starting point: academic freedom matters and freedom of speech matters, and we will preserve those two pillars of national strength, but we will proceed in a way that actually works. That is why we have carried out extensive engagement covering all corners of the debate: academics, universities, students; those for the Act and those against. All voices were heard.
I was especially keen to consider the views of minority groups, to learn how the Act might affect them, particularly given the shocking rise in antisemitism on campus. Standing here in this great Chamber of debate, I remain resolute about the importance of free speech, but our engagement on the Act has raised concerns that any responsible Government must take seriously. What was being proposed simply did not rise to the challenge: unworkable duties on student unions, a tort clogging up the court system, and the Office for Students obliged to consider a vast number of complex complaints.
There are also serious concerns over the Act’s potential impact on the welfare of minority groups. Many are worried that it could lead to increased harassment and discrimination on campus, and that the Act could push providers to overlook their safety. I share their concerns.
I reiterate that I am appalled by the rise in antisemitism on campus. In my view, rising antisemitism is best tackled through education, which is why I have confirmed £7 million in funding to tackle antisemitism in schools, colleges and universities.
I have reached a way forward that I believe is effective and proportionate, delivering an Act that is fair and workable. My decisions, subject to agreement from Parliament, will ensure that our higher education sector and the Office for Students continue to protect academic freedom and freedom of speech while ensuring the safety of minority groups.
I propose implementing key elements of the Act and returning others to Parliament for decisions on their amendment or repeal. I propose shortly commencing the following requirements currently in the Act: the duties on higher education providers to take reasonably practicable steps to secure and promote freedom of speech within the law; the duty on higher education providers to put in place a code of conduct on freedom of speech; and the ban on non-disclosure agreements for staff and students at higher education providers in cases of bullying, harassment and sexual misconduct. I also plan to commence the duties on the OfS to promote freedom of speech and the power to give advice and share best practice.
I will retain the director for free speech and academic freedom role, and I am pleased that Dr Ahmed will be staying on. I have complete confidence in Dr Ahmed. However, in my view, it is not right for this position to be a political appointee. The director should, of course, hold a deep belief in free speech and academic freedom, but their independence matters, and therefore their appointment must be free from any suspicion of political bias. Sir David Behan’s review of the OfS, commenced under the previous Government, recommended we reconsider how all OfS executive and board appointments should be made. I will decide on that shortly.
While there is much in the Act that is valuable, there are provisions that I do not believe to be proportionate or necessary, and which will drain resources from providers and distract from the other important issues they face. It is therefore my intention to return to Parliament to seek the repeal of two provisions.
The first is the duties on student unions in the Act. Student unions are neither equipped nor funded to navigate such a complex regulatory environment, and they are already regulated by the Charity Commission. However, I fully expect student unions to protect lawful free speech, whether they agree with the views expressed or not. I also expect HE providers to work closely with them to ensure that that happens and to act decisively to ensure their student unions comply with their free speech code of conduct.
The second provision I will seek to repeal is the tort. I have heard the views in favour of the tort, and understand the arguments being made. However, it would create costly litigation that would risk diverting resources away from students at a time when university finances are already strained. Members can be assured that the remaining routes of redress have plenty of teeth—the Office for Students will have powers to take tough regulatory action where universities and colleges do not meet their duties. Ultimately, an Act needs to be workable for its teeth to bite. How would Conservative Members rather our universities spend their time and resources: by lawyering up, or by focusing on high-quality teaching and groundbreaking research? In fact, the fear of litigation could hurt rather than help free speech, as universities may decide against inviting challenging speakers to avoid ending up in court, and nobody wants that.
I have a message for vice-chancellors who fail to take this seriously: protect free speech on your campuses or face the consequences. For too long, too many universities have been too relaxed about these issues, and too few took them seriously enough—and that must change.
There are other elements of the Act that I am planning to retain, but, with parliamentary agreement, to amend. I propose keeping a complaints scheme in place with the OfS. It is an important route of redress for anyone whose academic freedom or free speech has not been protected, and there must be a route for righting wrongs. However, it must be proportionate: the OfS should have the power to consider complaints, rather than a duty to assess every single complaint it receives, including those that are poorly put together or nonsensical. This way, the OfS will be freed up to prioritise the most serious complaints. I also want to remove the confusing duplication of complaints schemes for students. The Office of the Independent Adjudicator can already consider student complaints on free speech, and will continue to do so. The OfS complaints scheme will focus on complaints from staff, external speakers and university members.
I will also amend the OfS’s mandatory condition of registration to give it flexibility in how it applies this condition to different types of providers. The OfS should have room to determine the best way to regulate on a case-by-case basis. That is the only way to deliver a sensible system that actually works.
Finally, I will take more time to consider implementation of the overseas funding measures. I remain fully committed to tackling cases of interference by overseas Governments, and the wider measures in the Act will further strengthen our protections. However, I want to ensure that any new reporting requirements for providers add value without being overly burdensome. We continue to work at pace with the sector on the wider implementation of the foreign influence registration scheme. My officials are working across Government and with the sector to review our response, and I will confirm my final decision in due course.
I intend to draft a policy paper to set out these proposals in more detail and will return to the House when it is ready. Where I am returning matters to Parliament, I will keep them under review in the meantime.
Our universities are leading lights of learning. They are spaces for vigorous discussion where people of all ages, faiths and backgrounds can come together to debate new ideas. I call on universities to promote a culture of disagreeing well. There is already excellent work going on across the sector, but we must see more.
Let me be clear that students have a duty as well: to embody that spirit of debate that makes our universities great, and not to simply try to cancel any views with which they disagree. This Government will secure freedom of speech in legislation that is practical, proportionate and workable, but legislation alone will never be enough. Freedom of speech is not easy. It is not just a right, but a responsibility. If we want a culture of debate that is robust yet respectful, challenging yet considerate, and strong yet civil, we must all do our part to nurture it. The freedom of speech Act provides a legal framework, but it is up to all of us every day to build a culture of truly free speech. I commend this statement to the House.
Madam Deputy Speaker (Judith Cummins)
I call the shadow Secretary of State.
Laura Trott (Sevenoaks) (Con)
I thank the Secretary of State for advance sight of her statement. The Higher Education (Freedom of Speech) Act 2023 was passed by Parliament prior to the election. By the end of the Act’s passage through both Houses, the Labour party had agreed in principle with the need for it; indeed, there are positive signals coming from those on the Front Bench today. However, immediately after the election, Government sources said the Act was a Tory “hate speech charter”, and paused its implementation. I ask the Secretary of State: what has changed? Does she still stand by her characterisation of the Act?
It should have been obvious straightaway to anyone with even a basic sympathy for the norms of liberal education that pausing the Act was a mistake. It should have been clear again, when more than 650 academics signed a letter to The Times decrying the decision, that pausing the Act was a mistake, but the Secretary of State still did not budge from her position. It should have been undeniable that the Government had made the wrong choice when, acting together, no less than seven Nobel prize winners and a Fields medallist later added their names to that letter, but still Labour was happy to roll out the old tropes about hate speech. Literary luminaries like Sir Stephen Fry, Tom Holland and Ian McEwan were forced to intervene. Those with natural sympathies for the Secretary of State’s own political positions were compelled to tell her that she was wrong. It is only now, after all that humiliation, that she has finally changed her footing. I pay tribute to the academics who led that fightback outside Parliament.
Much like they have done with academies in the Children’s Wellbeing and Schools Bill, this Government take a wrecking ball to policy without a thought for the consequences. They are much more interested in virtue signalling than in what is right for the country, more interested in listening to student union advisers than to women hounded out of their jobs. Since the Secretary of State decided to pause the legislation, gender-critical women, among others, have, in the process of vindicating their rights, racked up enormous legal fees that have caused some to remortgage their houses. Professor Jo Phoenix said publicly that if the Act had been enforced, it would have saved her from that very ordeal. Will the Secretary of State now apologise to those who have suffered because of her inaction?
We have upcoming legal action in the judicial review brought by the Free Speech Union against the Government’s decision. Considering that a concern about expense was one of the reasons given by the Government to justify their decision, how much has that litigation cost to defend? What is the financial cost of the Secretary of State’s inaction? How much taxpayer money has been spent on a partisan play-up-to-your-own-gallery move that is about to fall flat of its face in the court? Did the Secretary of State receive legal advice before she made her decision to suspend the Act? Will she release it, so that Members can see the basis on which she acted? If she did not, how can she possibly claim to have acted responsibly in this matter?
Despite the Secretary of State’s statement, we now have confusion about what is actually happening. It seems that the Government cannot even do a much-needed U-turn properly. Without the tort, what consequences will universities face if they do not protect free speech? Why is the Secretary of State unable to set out a clear decision on overseas funding? Why is six months not enough time? Can she spell out the changes the Government are thinking about making to the overseas funding measure? Can she confirm that none of those were discussed during the Chancellor’s recent visit to China? Can she confirm that there were no deals done to amend that section? That is very important. It is extremely poor timing at best and invidious at worst to consider changes to the overseas funding element of the Act so soon after that trip to China.
It was always obvious that the Education Secretary made a mistake in pausing the Act, but rather than commencing a little more of the Act to try to cover up the mistaken delay, she needs to get up and perform the U-turn in full. The Act contains much-needed protections and she must not abolish them just because they came from the Conservative side of the House.
Finally, while we are at it, the Secretary of State should perform a U-turn on academy freedoms too. The Government must not take six months to realise their mistake on that one.
Bridget Phillipson
What we inherited from the previous Government was not a genuine attempt to solve a genuine problem; it was a mess designed to put party ahead of country. We saw a misplaced fascination with headlines for themselves, rather than a serious attempt to safeguard freedom of speech and academic freedom. It is precisely because this Government care about academic freedom and freedom of speech that we are determined to get this right, unlike the Conservative party. We are not content to leave it to vice-chancellors, who have done too little for too long. Universities must be places of robust discussion, where students’ views are challenged and academic freedom is central.
One of my many predecessors in the previous Government, the former Member for Chippenham, was unable to set out how the then Government’s proposals would prevent Holocaust deniers coming on to campus. Let me be clear: Holocaust denial has no place on campus or anywhere else in our society. The legislation would have emboldened Holocaust denial, and showed a shameful disregard for the welfare of Jewish students.
On the legal proceedings the right hon. Lady mentions, she was a member of the previous Government and knows very well that I am unable to comment on any aspect of that.
I said I would consider all options. I have done precisely that and have returned to the House, as I intended, to provide an update. If Conservative Members want to know what a U-turn on free speech looks like, I suggest they turn their attention to Liz Truss, who for so long extolled the virtues of free speech and is now on some bizarre quest to cancel the Prime Minister for saying that she and the Conservative party crashed the economy. Freedom of speech cuts both ways. What a bunch of snowflakes!
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Chair of the Select Committee.
Helen Hayes (Dulwich and West Norwood) (Lab)
I thank the Secretary of State for confirming the Government’s approach to the implementation of the Higher Education (Freedom of Speech) Act 2023, and I welcome the clarity that she has provided today.
The implementation of the Act will present some challenges for universities and for students. The Secretary of State will know that there can sometimes be a fine line between free speech and hate speech, and between statements of views and opinions and incitement or encouragement to violence or intimidation in the real world. Can she assure the House that she will ensure that universities and students are absolutely clear about the limits to free speech, which are already enshrined in law, and that support will be provided on the interpretation of that when it is needed?
Professor Shitij Kapur, vice-chancellor and president of King’s College London, has said:
“Universities are not there to function as a Speakers’ Corner where anyone can stand up and express an opinion not necessarily supported by facts. If academic freedom is to mean anything, it must be accompanied by the academic obligation for ideas and claims to be accompanied by evidence and reason. Proponents have an obligation to engage and respond to those questioning their assertions and conduct that debate and discourse in a civil manner.”
How will the Secretary of State ensure—particularly as the erosion of fact-checking and moderation on social media is taking place before our very eyes—that the implementation of the Act results in a high quality of evidence-based discourse conducted in a culture of civility?
Bridget Phillipson
I am grateful to my hon. Friend for her questions and her approach, and I look forward to discussing these issues with the Select Committee in due course should its members so wish.
My hon. Friend’s point about disagreement is important. Free speech should be robust and we should be able to express our views, but all of us, especially those in public life, have a duty to ensure that we do so in a way that is responsible. As for the tort—this is at the heart of the issue that she has identified—I was concerned that the potential impact of legal proceedings and the financial consequences for providers of breaching their duties under the Act might have led to some providers unduly prioritising free speech that is hateful or degrading over the interests of those who feel harassed and intimidated. These issues can be finely balanced. We will provide further clarity through the Office for Students, but let me make it clear that academic freedom and freedom of speech are crucial tenets of our country’s history.
Ian Sollom (St Neots and Mid Cambridgeshire) (LD)
I thank the Secretary of State for advance sight of her statement.
The Liberal Democrats fully support free speech, which, as several Members have pointed out, is at the heart of academic freedom, but it was clear from the start that this piece of legislation was not based on evidence, was not proportionate, and was fundamentally flawed. We welcomed the pausing of its implementation last year, and I welcome now the acknowledgement of its flaws and the Secretary of State’s move to repeal the provisions on the tort and on student unions in particular. I must, however, press her on the fundamental question of why the Act is necessary.
Higher education institutions already operate within a legal framework to ensure that freedom of speech within the law is secured for academic staff, students, employees and visiting speakers, and universities have already taken action to improve their policies and processes relating to freedom of speech. Universities UK, which represents over 140 universities, has reissued and expanded its guidance in this area, as well as having regular discussions with university leaders to support them with these challenges. Would the Secretary of State consider taking a more meaningful step to ensure that students are safe, welcome and protected at universities by giving higher education institutions a statutory duty of care for their students?
The Secretary of State also referred to the well-documented fears of minority groups, particularly those in Jewish communities, that the Act in its previous form would allow a platform for extremist views, and she mentioned Holocaust denial. We had some indication of this in her statement, but will she provide more details of her plans to protect those from minority groups and communities on our university campuses?
Bridget Phillipson
I am grateful to the hon. Gentleman for raising those questions. I will start where we agree, and then move on to where I might disagree with him.
I agree that freedom of speech and academic freedom are essential, but, sadly, we have seen too many examples of their not being upheld in the way that they should be by universities. The right hon. Member for Sevenoaks (Laura Trott) raised a number of cases in which we have seen unacceptable practice, and some individuals have had to seek recourse through employment law when it should have been possible for them to seek redress sooner. That is precisely what we are seeking to deal with in ensuring that the Office for Students is able to focus on the most serious cases without being caught up in complex cases that could be less well founded or even nonsensical.
I want to be clear that we have engaged with people with a range of views on these topics, including those who hold gender-critical views, those who were in favour of the legislation and those who had concerns. That careful process of engagement with the sector, stakeholders and people with a range of views has enabled me to come to the House today and set out our approach.
Madam Deputy Speaker
I call Mark Sewards, a member of the Education Committee.
Mr Mark Sewards (Leeds South West and Morley) (Lab)
I welcome the Secretary of State’s statement. It is good to see that our universities will no longer be a battleground in which political parties seek to make headlines—unsuccessfully, I might add. Does she agree that now that she has taken decisive action on this issue, it is time to talk about the financial situation facing many of our universities, which threatens their very existence? We know that students are paying far more for far less at university, and we need to end that ridiculous cycle.
Bridget Phillipson
I agree with my hon. Friend that, across the board, there are big challenges in the university sector. That is why I took the difficult but necessary decision last year to increase the fees that they are able to charge. This year, we will engage in reform right across the sector to provide the long-term financial sustainability that is required. As my hon. Friend recognises, we on the Government Benches are clear that our universities are a central part of our local and regional economies, and a beacon of excellence around the world. That is why so many students from around the globe seek to come to our world-leading universities.
Madam Deputy Speaker
I call Dr Caroline Johnson, a member of the Education Committee.
Dr Caroline Johnson (Sleaford and North Hykeham) (Con)
I respect the Secretary of State’s wish to ensure that she has considered the Act thoroughly. I regret that it has taken her so long to come to the conclusion that free speech is important, but I am glad that she has decided to bring into force many of the measures in the Act, which was introduced by the Conservatives. However, she has chosen to exclude student unions from the legislation. Can she say a bit more about how they will be held to account if they fail to keep in line with her desire to promote free speech?
Bridget Phillipson
On the timescale, this is a complex area, but in a little over six months we have consulted a wide range of stakeholders and considered all views, which is why I am able to return to the House today to update Members. The hon. Lady is right to say that we have decided not to commence provisions that will impose new duties on student unions. That is because some smaller providers have only a handful of members and do not have the resource or funding necessary to handle such claims, and they are already regulated by the Charity Commission. However, we fully expect student unions to protect freedom of speech, and providers to ensure that their student unions do so as well.
Charlotte Nichols (Warrington North) (Lab)
I welcome the careful and considered approach that the Secretary of State has taken to this issue; it stands in stark contrast to when the Act was first brought forward. I refer the shadow Secretary of State, and indeed the House, to my comments in Hansard on 13 May 2021, when the previous Secretary of State explicitly confirmed on Radio 4 that Holocaust denial would be protected speech. In that vein, does my right hon. Friend share the concern of groups such as the Union of Jewish Students and the Antisemitism Policy Trust that the draft guidelines produced by the Office for Students risked undermining existing good practice in tackling antisemitism? Will she give an assurance that the OfS will meet Jewish representative organisations to ensure that such mistakes cannot be repeated?
Bridget Phillipson
I am confident that the OfS, as the regulator, and its director for freedom of speech will seek to engage with a range of views, including those of Jewish students and community organisations, as they take forward this important work. That is certainly something that I have done to understand the concerns and the potential impact on minority students, including Jewish students, at a time when we all sadly know that antisemitism on our campuses and streets has been rising. As a country, we must do everything in our power to tackle that.
Graham Stuart (Beverley and Holderness) (Con)
This screeching U-turn is welcome and I hope that, as the shadow Secretary of State says, it heralds a new period of humility and further change by the Government. The Secretary of State said that universities must protect free speech or “face the consequences”, but as far as I can see, she has removed those consequences. Could she please lay them out for us?
Bridget Phillipson
I know that the right hon. Gentleman is probably used to his party engaging in these discussions on quite difficult and sensitive issues in a rather reckless and irresponsible way, but we on these Benches take our time to do this seriously and properly to make sure that we get it right, because this is such an important area. He will have heard from my speech—I will set out further detail—the requirements that will be in place through registration conditions, the fact that the Office for Students will be able to impose penalties on institutions, and the requirements that we expect of all higher education providers. My message to vice-chancellors and institutions today is that they need to do more, and they need to do it better.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Select Committee member Darren Paffey.
Darren Paffey (Southampton Itchen) (Lab)
I thank my right hon. Friend for her statement and for the measured, practical and common-sense approach that it takes, which is in sharp contrast to what we are hearing on the Opposition Benches at the moment. Although we will always defend their right to their opinions, a right to their own facts is rather regrettable and their revisionism is quite astounding. I know at first hand the value of a university education. It is about having our views challenged. It is about critical thinking based on evidence and facts and having our horizons opened. Does the Minister agree that this foundation and the measures announced today are the right way to secure academic freedom in the future?
Bridget Phillipson
My hon. Friend, through his background in higher education, knows all too well how essential it is that young people and students from a range of different backgrounds are exposed to views that they might not previously have heard or that they might find difficult or challenging. That is what a university education is all about, and that is what we are determined to secure and protect through the statement that I am making today.
Several hon. Members rose—
Madam Deputy Speaker
We have substantial business to get through today before the House rises, so if questions are short I can get everybody in; if they are not, people are going to be disappointed.
Sir Gavin Williamson (Stone, Great Wyrley and Penkridge) (Con)
I thank the Secretary of State for coming to the House and setting out the revised position of the Government. I am particularly concerned about the removal of the tort, because it effectively removes the real consequences for people who disregard free speech and the consequences that could be imposed on an institution or organisation. If that is going to be the case, can she set out to the House what resources will be dedicated to the director of free speech? Let us hope this is not just a one-person fig leaf. How many people are going to be working for them? What resource will there be to ensure that free speech is protected?
Bridget Phillipson
I am grateful to the former Secretary of State for his question. He will appreciate that this will be an independent regulator, and that there is a limit to what I can set out on their behalf. On the key issue of the tort, there will be consequences, even following the removal of the tort, for those providers who do not fulfil their duties under the Act. The OfS can already regulate providers in relation to free speech. It will be able to take regulatory action where there are breaches of the duties under the Act, including monetary penalties if needed, and the complaints scheme will enable the OfS to make recommendations to providers that they will be expected to follow. Existing routes of redress through judicial reviews and employment tribunals will remain open, but we want the OfS to focus on making sure that there is a system in place that is workable so that complaints can be dealt with swiftly.
Chris Vince (Harlow) (Lab/Co-op)
I thank the Secretary of State for this statement. I think freedom of speech is really important, but it should be done in an environment of shared respect, as it is most of the time in this place. I welcome this pragmatic approach to the process. Will she confirm that the previous unworkable legislation would have added additional financial stress to institutions?
Bridget Phillipson
It is important that any legislation in this area is fair, proportionate and workable, and that is what we have sought to achieve through the wider engagement and consultation that has taken place since July, when I paused commencement. It is vital that we get it right. It is incredibly important, and today we have given clarity to the sector around expectations into the future.
Mr Richard Holden (Basildon and Billericay) (Con)
I welcome the words from the Secretary of State around freedom of speech today—she knows that I have asked about this in the House previously—and I also welcome the partial U-turn. Will she join me, though, in thanking the academics who have really put pressure on the Government to get to this position, and also the work of the Free Speech Union? Will she encourage all academic institutions to sign up to the Chicago principles? Can she give us a brief timeline on when the foreign influence registration scheme could come forward?
Finally, I will be setting up the all-party parliamentary group on freedom of speech in the coming weeks. Will the Secretary of State agree to come along and speak to us about this at some point?
Bridget Phillipson
I am afraid I did not quite catch the very last part of the right hon. Gentleman’s questions, but I will happily look in Hansard and return to him on that point.
Madam Deputy Speaker
I think he just wants to hear a yes to attending a meeting.
Bridget Phillipson
I am afraid I am not going to do that without having reviewed exactly what the right hon. Gentleman said, Madam Deputy Speaker. I know him quite well. The Department for Education and the Home Office are looking jointly at some of these areas, and I want to be clear that national security is our No. 1 priority as a Government. I am grateful to all those who have engaged in good faith with the Department in this conversation. They hold a wide range of views: there are those who are for the Act and those who are against, as well as those with views somewhere in the middle and those with some new ones. I am grateful for their contributions to this discussion. I hope they can all see that we have taken this seriously and that we now have a workable plan to ensure that freedom of speech and academic freedom in our institutions are protected into the future.
Matthew Patrick (Wirral West) (Lab)
Frank Field was a very good friend of mine. He believed deeply in seeking out disagreement with other people for a richer conversation, and in the importance of listening in good faith to arguments made in good faith. Does my right hon. Friend agree that we should see that spirit across university campuses? How will her measures ensure that that is a reality?
Bridget Phillipson
I think we can all learn from Frank Field, who brought wisdom to a range of areas. We can all reflect on the need to keep our views under constant review to ensure that we challenge ourselves. The chance to be educated, whether at school, college or university, is a crucial part of challenging ourselves and understanding the world in all its many forms. These measures will allow university students to have precisely that experience.
Matt Rodda (Reading Central) (Lab)
I thank the Secretary of State for her statement. I particularly welcome the emphasis on reducing burdens for universities, which will mean a lot to smaller institutions such as the smaller research-intensive institutions like Reading University in my constituency. Will she commit the Department to continuing to work with smaller research-intensive institutions?
Bridget Phillipson
Yes. One of the many brilliant aspects of our country’s higher education sector is its diversity—smaller institutions, larger ones and those that bring a wealth of difference, having evolved and changed in different ways. We will continue to listen to and work with providers and institutions of all shapes and sizes across our country.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
I congratulate the shadow Secretary of State on the sheer audacity of coming to this place and pretending that hers is the party of free speech. It was her party that introduced the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014, the single largest restriction on free speech in the charity and voluntary sector, purely because the sector was saying things the then Government did not want to hear.
I encourage the Secretary of State to ignore the whines and the whinges, the gripes and the groans, of the Conservative party and carry on with what she is doing, because she is absolutely right. Universities are where people can challenge new ideas and hear things with which they may disagree. What advice is she giving to universities about the support they put in place so that students can explore these new ideas and have their own views challenged in a way that is safe and secure?
Bridget Phillipson
My hon. Friend is absolutely right that freedom of speech cuts both ways, and Conservative Members would sometimes do well to reflect on that, too.
Sometimes, students can be exposed to views they find challenging or difficult, especially younger students who are newly away from home, and it is right that we put in place the right support. Institutions have invested a lot in mental health support and other provision. I think this also underlines the need to turn around the provision in the national health service, because I am concerned about the extent to which providers are having to put in place additional support, above and beyond what should be a statutory requirement for every person in our country.
Joani Reid (East Kilbride and Strathaven) (Lab)
I thank the Secretary of State for her statement, and I particularly welcome the funding for tackling antisemitism on campus, which is a well-documented problem. When the original guidance on the Act was published, it took an approach to free speech that did not take account of the limitations on freedom of expression for minority groups that arise from hate speech.
As chair of the all-party parliamentary group against antisemitism, I am particularly concerned about the risk of giving that hate implicit protection and amplification on campuses. Can the Secretary of State assure me and minority community representatives who have raised this issue with us that any future guidance will more carefully outline the importance of expression for all, including minority groups that are sometimes crowded out by loud, hateful voices?
Bridget Phillipson
I will ensure that my hon. Friend’s point is taken up. Many have raised very serious concerns about antisemitism on campus and its impact on Jewish students, and I can see no good reason why any university would invite a Holocaust denier on to campus to deny the overwhelming evidence. Holocaust denial is an appalling form of antisemitism.
Yesterday, I joined the Holocaust Educational Trust in Parliament to make sure that, as we come to the 80th anniversary of the liberation of Auschwitz-Birkenau, we redouble our efforts to fight hatred and prejudice, including antisemitism, wherever we find it in our country.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I declare an interest, not only as someone who has worked in the sector, but as a member of the freedom of expression organisation English PEN, which condemned the approach of the previous Government because it felt it would restrict academic freedom. Further, my constituent, who is a well-regarded economist, lost his job after publishing research into the impact of migration on coalfield communities. Will the Secretary of State assure my constituent that this Government are committed to academic freedom and to ensuring the stability of academic institutions?
Bridget Phillipson
I give my hon. Friend that assurance. That is also why, as one of the measures that I intend to return to, we must look again at the board and executive appointments to the Office for Students. It is right that concerns have been raised that there could be the suspicion of political interference given that, rather unusually for that kind of appointment, it involves a political appointee. People might regard that as fine if they agree with the views of the Government of the day, but I do not think that is a good principle on which we enshrine in law very important positions that are central to how we uphold academic freedom and freedom of speech in this country.
Adam Thompson (Erewash) (Lab)
I thank the Secretary of State for her statement and particularly in regard to the removal of the tort from the existing legislation. That will allow our universities to ensure that funds get spent on students and not on complex legal issues.
As the Secretary of State has said repeatedly today, the Government take the need to expose students to a wide range of issues seriously. As a former academic, may I ask my right hon. Friend whether she agrees with me that our universities must remain centres of robust, rigorous debate always?
Bridget Phillipson
Yes, that is crucial. We know that the chance to study at university is life changing for so many students. That is of course the case for younger students—those who have what might be considered the more traditional experience of going to university at 18—but it is also about having the chance throughout life to return to education and training. That is what I have seen across so many institutions in our country. They put in place fantastic opportunities for upskilling and retraining later on in life, as people think again about how they want to go about things. I praise those institutions’ fantastic work in driving growth and innovation, and in the months to come, we will work with them to ensure they can do more.
Laurence Turner (Birmingham Northfield) (Lab)
May I invite the Secretary of State to respond to the following statement that was shared by the Union of Jewish Students while she was on her feet?
“We support the changes brought forward by the Secretary of State. She has listened to the concerns we and others raised and has taken action. The result is that the Act will now be less likely to damage efforts to tackle anti-Jewish racism on campus. That should be welcomed by everyone.”
Bridget Phillipson
I am grateful to my hon. Friend for sharing those comments. I pay tribute to the Union of Jewish Students for the amazing work it does every day to support Jewish students on campus and to ensure that their voices are heard, including at the highest levels of Government. I give my commitment to UJS that I will continue to work with it and other student groups to make sure their voice is always heard. We as a Government are resolutely behind them in the fight against antisemitism in our country.
Dr Scott Arthur (Edinburgh South West) (Lab)
As someone who was an academic until about 5 am on 5 July last year, I thank the Secretary of State for her statement and for the leadership she has shown on this issue. I will ask a question in the context of my entry in the Register of Members’ Financial Interests.
I am proud of all the universities in Edinburgh and how they attract students from all over the world, but last year when I visited the Edinburgh Hebrew Congregation, which is the main synagogue in Edinburgh, I was ashamed to hear of the intimidation that Jewish students were facing in university. I was pleased to hear that universities are taking that seriously and I know that the Edinburgh faith forum is too. Freedom of speech is an important right, but that should never extend to bigotry and hate. Does the Secretary of State agree that students should be free to practise their faith, always, and able to display their faith publicly, no matter what it is, without fear of intimidation?
Bridget Phillipson
That is absolutely essential. The same is true for Jewish students and others from minority groups as they go about their business at school and college. Sadly, I have heard too many examples of abuse and intimidation of the sort that my hon. Friend describes. Universities must be robust places of intellectual challenge and rigour; there is no good reason why students should feel intimidated or harassed in a place where they should find comfort, challenge and support.
Point of Order
(3 days, 7 hours ago)
Commons ChamberRead Full debate Read Hansard Text
Dr Rupa Huq (Ealing Central and Acton) (Lab)
On a point of order, Madam Deputy Speaker. I wish to raise an all-party parliamentary matter that is causing international ructions. Before Christmas, a report surfaced in the name of the all-party parliamentary group for the Commonwealth. Basically, to the annoyance of APPG officers and many members of the public, it was a hatchet job on the interim Government of Bangladesh. On a delegation to the high commission in London during recess, I was picked up on this. Even when I went to Bangladesh, the interim leader, Professor Yunus, a Nobel prize winner, also said, “What are your Government doing issuing these falsities in the name of Parliament?”
I wish to seek your advice on this, Madam Deputy Speaker. Can I get clarification on the significance of such things being issued? When I inquired into this, I was told that a pressure group had put out this report without final sign-off. So do these things constitute policy in any way, and is it right that a partisan organisation can hijack an APPG and then besmirch the name of our Parliament and our Government?
Madam Deputy Speaker (Ms Nusrat Ghani)
I am grateful to the hon. Member for giving notice of her point of order. She has put her point on the record. I am happy to confirm for the benefit of the House that all-party parliamentary groups represent a wide range of views across both Houses and their reports do not necessarily reflect the views of His Majesty’s Government or indeed of the wider membership of this House.
I now have to announce the results of today’s deferred Divisions. On the draft Electricity Capacity Mechanism (Amendment) Regulations 2024—[Interruption.] I can see that the right hon. Member for East Hampshire (Damian Hinds) is incredibly excited by this. As I was saying, the Ayes were 418 and the Noes were 78, so the Ayes have it.
On the draft Official Controls (Amendment) Regulations 2024, the Ayes were 423 and the Noes were 77, so the Ayes have it.
On the draft Clean Heat Market Mechanism Regulations 2024, the Ayes were 424 and the Noes were 109, so the Ayes have it.
[The Division lists are published at the end of today’s debates.]
Bill Presented
Outdoor Education
Presentation and First Reading (Standing Order No. 57)
Tim Farron presented a Bill to require that every child be offered at least one outdoor education experience during primary school years and at least one such experience during secondary school years; and for connected purposes.
Bill read the First time; to be read a Second time on Friday 11 July, and to be printed (Bill 161).
Youth Mobility Scheme (EU Countries)
Wednesday 15th January 2025
(3 days, 7 hours ago)
Commons ChamberRead Full debate Youth Mobility Scheme (EU Countries) Bill 2024-26 View all Youth Mobility Scheme (EU Countries) Bill 2024-26 Debates Read Hansard Text
A Ten Minute Rule Bill is a First Reading of a Private Members Bill, but with the sponsor permitted to make a ten minute speech outlining the reasons for the proposed legislation.
There is little chance of the Bill proceeding further unless there is unanimous consent for the Bill or the Government elects to support the Bill directly.
For more information see: Ten Minute Bills
This information is provided by Parallel Parliament and does not comprise part of the offical record
James MacCleary (Lewes) (LD)
I beg to move,
That leave be given to bring in a Bill to require the Secretary of State to enter into negotiations with countries which are members of the European Union for the purpose of extending the Youth Mobility Scheme to applicants from those countries on a reciprocal basis; and for connected purposes.
The immense damage caused by the Conservatives’ botched Brexit deal is clear for all to see. Few thought that young people would be able to go for two years to live and work all the way over in Japan, but not be able to hop across the channel to do the same in France. I am not sure that anyone voted for that kind of increased bureaucracy back in 2016. This Bill gives us the chance to send a different message to a generation of young people who have been denied the opportunities that so many of us in this Chamber took for granted when we were growing up. If we wanted to take a job or to study in an EU country, we could just go and do so. Opportunity and hope for the future have rarely been in such short supply in this country, and this is how we can provide some of both.
What I am proposing is a pragmatic, defined scheme that will once again allow young people across the UK to be able to spend time with our nearest neighbours without having to navigate a tangle of Brexit red tape. It is a youth mobility scheme with the EU that would open up opportunities for British young people to learn new skills, languages and cultures and bring all of that back with them to benefit our economy and our society. This would not be the UK’s only reciprocal youth mobility scheme. We have such arrangements in place already with Australia, Japan, New Zealand and Canada. They are familiar and tried and tested, allowing those aged 18 to 30 to live, work and study in the countries involved for a set period.
The Government have made much of their so-called missions. Mission No. 1, we are told, is economic growth, yet any proposal that might involve our European neighbours and contribute to boosting growth is dismissed. The UK is facing acute labour shortages, particularly in key sectors such as hospitality. These are exactly the kinds of jobs that young people visiting the UK for a few years might take on, whether while studying, immersing themselves in our culture or improving their grasp of our language. The situation suggests that this is a Government who are not serious about making the practical, hard-headed choices that would greatly benefit the UK economy and labour market in the long term, stimulating growth and improving the lives of British people.
The Government also talk up their reset with the EU, which, so far at least, seems to involve little more than warm words and a continuation of the previous Government’s attitude of seeing closer co-operation with the EU as a threat, rather than as a considerable opportunity to make Britain more secure and prosperous. Indeed, the Government have stuck so closely to the Conservative party’s script—or is it Reform UK’s script?—that Ministers have even mischaracterised, repeatedly in fact, a youth mobility scheme with the EU as a return to freedom of movement. That is categorically not what is being proposed here. Any scheme would be time limited and involve a restricted cohort of eligible people. I truly hope that the Government will seriously reconsider their short-sighted and self-defeating position on the issue.
A number of hon. Members from across the House have rightly asked Ministers directly for an explanation of their refusal to explore such a scheme, yet no one has given a response that makes any sense. Meanwhile, the Government have tied themselves up in unnecessary red lines on Europe that do nothing to boost growth or support British businesses and young people. Even that cannot be used as an excuse, as this proposal does not breach any of those red lines.
The situation is having a real impact on young people growing up in this country today. Let me share Alex’s story. A bright and ambitious 25-year-old from Taunton, Alex left university last year with the aim of working in a German fintech start-up. He had planned to move to Germany for a few years, then return home with a better understanding of the German language, and with the knowledge and skills to launch his own start-up here in the UK, but the hurdles proved insurmountable. He told me:
“I didn’t want to move there forever, I just wanted a year, maybe two, to earn invaluable experience, polish my language skills and get to know German culture.”
With no simple mobility arrangement in place between the UK and the EU, Alex ended up shelving his plans.
Not only did Alex lose out, our economy lost out too. The Government’s failure to act risks closing the world to a whole generation of Alexes across the UK. It is also holding back British growth and prosperity. Let us take the UK’s £82.5 billion tourism sector as an example. It has been grappling with the impact of the last Government’s failure to address youth mobility with the EU. ABTA, a trade body representing the sector, reported a 69% drop in UK nationals working in European tourism roles in the five years after the EU referendum. Businesses that once offered transformative opportunities to young Britons now face rising costs and critical staffing shortages.
I have heard from one UK-based tourism company that once employed more than 400 young Britons a year. Mobility restrictions have forced it to drastically scale back its operations, undermining years of competitive advantage, and slashing training and employment opportunities for young UK workers. European Pubs, which runs bars and restaurants in France, previously relied on UK staff for most seasonal roles. Today, only 50% of its workforce is British. A youth mobility scheme, which recent polling shows is backed by a clear majority of British voters, could ease labour shortages, provide essential career pathways and help to safeguard our tourism sector’s future vitality.
Meanwhile, our small and medium-sized businesses are really struggling, especially in sectors where staff shortages have become acute. Sectors from hospitality to the arts, entertainment and retail are desperately short of staff. With the UK’s ageing population, that is unlikely to improve in the future. A youth mobility scheme would offer British businesses an excellent opportunity to address staffing shortages by welcoming young people from EU countries for a limited period, bringing fresh talent and energy to our workforce. With the threat of tariffs from the incoming President of the United States, it has never been more important for our Government to break down barriers to opportunity elsewhere.
When speaking with counterparts in Brussels in my capacity as the Liberal Democrat Europe spokesperson, I have been struck by a clear message. After years of attempts to cherry-pick, the UK now needs to show that it is once again a trusted and reliable partner. By taking the lead on a youth mobility scheme, we have an opportunity to build that trust with our European allies that would allow us to explore our other priorities. Britain’s ability to strike new deals on defence, agriculture and trade would falter if we sent the signal that we are unwilling to move on a pragmatic, mutually beneficial scheme like this one. A carefully designed youth mobility scheme would give the British people control. It would ensure that participants could come here only under a clearly defined category and a tightly controlled time limit, while also signalling that we value cultural exchange, business growth and an ongoing partnership with our nearest neighbours.
Let us be honest: we cannot afford to keep letting down young people like Alex, nor can we keep small businesses in limbo, forcing them to cope with staff shortages, when a scheme like this could do so much to help. Young people in this country already face unprecedented challenges: a housing crisis, low salary growth, a rising cost of living and high taxes on income. The very least the Government could do is to remove barriers preventing young people in the UK from living and working in the rest of Europe. It saddens me that the Government have so far ruled out such a scheme. I call on the Government to give the young people of this country a proper explanation. Many of them have put their faith in the Labour party to reverse the damage done by the previous Government but remain disappointed and frustrated.
The Bill calls for a solution that would restore vital opportunities for our young people who have been left high and dry by the Conservatives’ botched Brexit deal. By embracing a well structured and controlled youth mobility scheme, we would send the powerful message that this country is serious about supporting our young people and backing British business with the labour force it needs to grow. This is a moment to bring opportunity and renewed good will back into the heart of UK-EU relations—a real reset. The issue will not go away and, as a Liberal Democrat, I am proud to have sponsors from the Green party, SNP, Plaid Cymru and the Alliance party of Northern Ireland. Many on the Labour and Conservative Benches know that a youth mobility scheme with the EU is the right thing to do. It is time to rebuild our relationship with Europe and set our young people free. I commend this Bill to the House.
Question put and agreed to.
Ordered,
That James MacCleary, Tom Gordon, Siân Berry, Caroline Voaden, Stephen Gethins, Sorcha Eastwood, Sarah Olney, Liz Saville Roberts, Mr Joshua Reynolds, Richard Foord, Helen Maguire and Liz Jarvis present the Bill.
James MacCleary accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 25 July 2025, and to be printed (Bill 160).
Non-Domestic Rating (Multipliers and Private Schools) Bill
Wednesday 15th January 2025
(3 days, 7 hours ago)
Commons ChamberRead Full debate Non-Domestic Rating (Multipliers and Private Schools) Bill 2024-26 View all Non-Domestic Rating (Multipliers and Private Schools) Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 15 January 2025 - (15 Jan 2025)
17:58 - The House divided: - Ayes: 175 / Noes: 342 - Question accordingly negatived.
18:13 - The House divided: - Ayes: 174 / Noes: 340 - Question accordingly negatived.
18:27 - The House divided: - Ayes: 172 / Noes: 341 - Question accordingly negatived.
18:52 - The House divided: - Ayes: 341 / Noes: 171 - Question accordingly agreed to.
Vikki Slade (Mid Dorset and North Poole) (LD)
I beg to move, That the clause be read a Second time.
Madam Deputy Speaker (Ms Nusrat Ghani)
With this it will be convenient to discuss the following:
New clause 2—Review of impact of new multipliers—
“(1) Within eighteen months of the day on which sections 1 to 4 of this Act are commenced, the Secretary of State must conduct a review of the impact of those sections.
(2) The review must consider—
(a) the impact of the introduction of the lower multiplier on qualifying retail, hospitality and leisure hereditaments,
(b) the impact of the introduction of higher multipliers in relation to a hereditament for which the value is £500,000 or more.
(3) The Secretary of State must, as soon as is reasonably practicable, publish the review and lay a copy of that review before Parliament.
(4) As part of the review the Secretary of State must consult with such parties as they see fit including—
(a) businesses,
(b) the Valuation Office Agency; and
(c) Billing Authorities.”
This new clause would require the Secretary of State, within 18 months of sections 1 to 4 of the Act being commenced, to review and consult on the impact of new multipliers.
New clause 3—Sections 1 to 4: impact assessment—
“(1) The Secretary of State must, within six months of this Act being passed, conduct an assessment of the expected impact of sections 1 to 4 of this Act on relevant businesses.
(2) The assessment must compare the amount of non-domestic rates expected to be paid by relevant businesses once sections 1 to 4 come into force with the amount paid in each financial year between 1 April 2020 and 31 March 2026.
(3) The assessment must consider how the impact is expected to differ depending on the number of hereditaments a business occupies.
(4) The Secretary of State must lay before Parliament a report setting out the findings of the assessment.
(5) In this section, a “relevant business” is a business occupying a qualifying retail, hospitality or leisure hereditament.”
This new clause would require the Secretary of State to examine the effect of the introduction of retail, hospitality and leisure multipliers on the amount of business rates paid by businesses occupying a single site compared with those occupying multiple sites.
Amendment 9, in clause 1, page 2, line 5, at end insert—
“(1A) Regulations under sub-paragraph (1)(a) must provide discretion for billing authorities with regard to the application of the higher multiplier.”
Amendment 1, in clause 3, page 3, line 29, after “hospitality” insert “, manufacturing”.
This amendment would add manufacturing businesses to the types of business that could qualify for use of the lower multiplier.
Amendment 2, page 3, line 33, after “hospitality” insert “, manufacturing”.
This amendment is consequential on Amendment 1.
Amendment 3, page 4, line 9, after “hospitality” insert “, manufacturing”.
This amendment is consequential on Amendment 1.
Amendment 4, page 4, line 13, after “hospitality” insert “, manufacturing”.
This amendment is consequential on Amendment 1.
Amendment 5, page 4, line 31, after “hospitality” insert “, manufacturing”.
This amendment is consequential on Amendment 1.
Amendment 6, page 4, line 35, after “hospitality” insert “, manufacturing”.
This amendment is consequential on Amendment 1.
Amendment 7, in clause 5, page 5, line 37, leave out from ”persons” to end of line 38 and insert—
“who have special educational needs.
“(5A) In subsection (5) “special educational needs” has the same meaning as in section 20 (When a child or young person has special educational needs) of the Children and Families Act 2014.”
This amendment would mean that a school that is wholly or mainly concerned with providing education to persons with special educational needs would not be a private school for the purposes of the Act, and as a result would retain charitable relief from non-domestic rates.
Amendment 8, page 5, line 38, at end insert—
“, or
(b) has a religious character or other special character and there is no maintained school or academy of the same character within the specified distance from that school.
(5A) In sub-paragraph (5)(b)—
“religious character” has the meaning given under section 69 (Duty to secure provision of religious education) of the School Standards and Framework Act 1998,
“other special character” has the meaning as defined by the Secretary of State by regulation,
“specified distance” is the distance specified under section 445(5) (Offence: failure to secure regular attendance at school of registered pupil) of the Education Act 1996.
(5B) Regulations under this section are to be made by statutory instrument.
(5C) A statutory instrument containing regulations under this section may not be made unless a draft instrument has been laid before and approved by resolution of each House of Parliament.”
This amendment would provide that charitable rate relief would continue to apply to a school with a religious or other special character, if no maintained school or academy with the same character was within the statutory walking distances (as set in the Education Act 1996) from that school.
Amendment 10, in clause 6, page 6, line 22, leave out “2025” and insert “2026”.
Vikki Slade
Business rates reform is long overdue. It is frequently cited by my constituents as the biggest concern for their businesses’ survival and one of the most direct inhibitors to their growth.
I was contacted this week by a constituent from a local business in Three Legged Cross, right on the edge of my constituency. He has been running it for over 40 years, and the cliff edge created by the small business rate relief means that his rates bill will go from £2,800 to £8,500 per year. The only thing that will save this microbusiness is systemic change as proposed by the Lib Dems in our manifesto, not a tax based on an arbitrary valuation that bears no relationship to the activity taking place inside his building.
High streets are trying to redefine themselves, moving from the heart of goods purchasing to literal shop windows as they struggle to compete against online competitors that do not have their overheads. It would be wrong to think that the solution is to try to return to the perfect high street of the past, as if such a thing exists.
I am old enough to remember C&A being the place me and my friends browsed for the latest fashions, and there was a Blockbuster video store and pic ’n’ mix from Woolies. Where are they now? It is dangerous and self-defeating to be caught up in toxic nostalgia, trying to reclaim the past as some kind of perfect place. Parliament must enact legislation that supports the society of tomorrow and towns that will work for a technological and multicultural age—indeed, an age in which people can no longer afford the stuff that we used to buy on a Saturday afternoon, or are choosing, as I do now, to buy their stuff from second-hand stores.
The dangerous gap between the slashing of retail hospitality and leisure relief by almost half, and a regime that brings in as yet undefined new multipliers, brings real risk. Our new clause 1 would require a review of the impact of clauses 1 to 4 on businesses, on high streets and on the real prize of economic growth that the Government mention so often. There has been a lot of talk in recent months about decisions being made without clear impact assessments. As we move through a period of reform, enshrining such an assessment in law, rather than questioning later whether it has been done, would save us all a lot of trouble and demonstrate that the Government genuinely want to make improvements.
Dr Luke Evans (Hinckley and Bosworth) (Con)
One issue that the hon. Lady has not yet mentioned is the impact of the Employment Rights Bill, which will create further red tape for our high street businesses when it comes into play. Do the Liberal Democrats think that the Government should consider that? Changing taxes and rates is one thing, but creating red tape at the very same time, constraining business growth, is another.
Vikki Slade
I agree that this is a difficult time for small businesses, with so many things changing at the same time—not least the increasing national insurance rates.
To return to the role of the high street, the most successful high streets are moving quickly to reinvent themselves. Since my election, I have been trying to find a high street location for my constituency office. I had decided to base myself in the historic market town of Wimborne, where my mum lived and my children went to school. It is the fastest-growing community in Mid Dorset and North Poole—Ministers have heard me talk about its housing problems many times—and it has great bus routes. I thought it would be a great place to find a small unit easily.
I was wrong, however. The strength of the sense of place, the innovation of its businesses and the hard work of its business improvement district and its town council are such that when a business closes down, others are waiting to move in. I have finally found my new home, which will open by the end of the month when we have fitted it out, but the experience proved what I already knew: the high street can survive, but only when the business community is prepared to give people what they want. Retailers such as Tickles and Co. trade alongside the hospice shop, and old businesses such as Bartletts, which has for 120 years sold smart clothes for all seasons, are able to sustain themselves despite changes in the market.
The Lib Dems welcome the proposal to permanently reduce business rates for retail, hospitality and leisure, and we acknowledge that the financial situation the Government were left by the previous Government makes the 75% discount difficult to maintain, but any discount is worthless if businesses that are trying to stabilise following the covid pandemic, the energy crisis and the shift to online cashless purchasing do not even make it through the next year. As I have said before, that is not the reform that business needs. The Minister has already said that this is just phase 1, but we are incredibly frustrated that he has not taken the opportunity to take things further.
New clause 3, in the name of my hon. Friend the Member for St Albans (Daisy Cooper), focuses our proposals further on the retail, hospitality and leisure sector, and raises valid points about the risk to individual businesses compared with those that have multiple branches. There must be an assessment of that risk alongside a broader impact assessment.
Daisy Cooper (St Albans) (LD)
My hon. Friend is giving an impassioned speech about the importance of business rates reform. Does she agree that there is a risk of unintended consequences in what the Government are proposing? At the moment, the 75% relief is capped at £110,000, but when the relief goes to zero in two years’ time, that cap will not exist. House of Commons Library research shows that the net effect could be that small businesses end up being 80% worse off, while big chains such as Starbucks could be 40% better off. Although it is important that we get a review of the impact of business rates, it is also important that we get the differential assessment set out in new clause 3.
Vikki Slade
I completely agree with my hon. Friend. One problem is the same law of unintended consequences that we have seen with things like the national insurance increase—which, as we repeat over and over again, is impacting small businesses, hospices, doctors’ surgeries and things like that—when quite understandably, an attempt is made to raise funds from elsewhere.
I want to share the views of Anthony Woodhouse, the chair of Hall and Woodhouse brewery and pub chain, founded and based in Dorset but with a branch just across the way from this place—unfortunately, I am not able to be at its event in Portcullis House because of the timing of today’s debate. Anthony told me that the revaluing of property when a huge amount of money has just been invested to make it fit for a changing market, and before you have even had a chance to benefit from that market, is completely crazy and discourages business investment. As such, it is important that as we look to reform business rates, we examine that issue as well.
Despite our failure to do that, businesses such as Anthony’s are responding to the market. Pubs such as the Olive Branch in Wimborne and the Old Granary on Wareham quay are now places where muddy boots, children and dogs are welcome, and where they sell as many cups of coffee as pints of local beer. The high street needs to morph as businesses have—to be ready and willing to change—but while business rate reform rightly starts with the high street, it is important that it does not end there.
As such, I turn to our amendments 1 to 6, which would add manufacturing businesses to the lower multiplier. The UK has a rich history of manufacturing excellence, and Barclays’ “Made in Britain” report found that a product being made in Britain held an important influence over consumers’ decision to purchase it, with customers perceiving such products to be high quality, reliable and internationally respected. The “made in Britain” tag was found to be worth an addition £3.5 billion a year to our UK exporters, which is why we believe that the lower multiplier should also apply to manufacturing businesses. We need to give those businesses a shot in the arm to ensure they can compete on the world stage. The threats by incoming President Trump to put tariffs on UK products, our continued isolation from our neighbours through an inadequate Brexit deal, and the rapid growth of economies such as China and India represent a real threat to local manufacturing.
Poole Bay Holdings, based in my constituency, stands ready to produce its innovative Koolpak here in the UK. Anybody who has children will know the brand Koolpak—it is that ice pack that is not even ice—and that business has been modifying its equipment so that it can make the product here, in Dorset, to compete with China. It stands ready to drive up those sales. Recognition of such businesses through a lower multiplier, or at least the potential to include them in a lower multiplier if the market becomes more tricky, is the intent behind our amendments.
Turning to amendments 7 and 8, which stand in the name of the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), the Liberal Democrats simply do not believe in the taxation of education. Alongside the changes to VAT, the removal of the special status for schools is really disappointing. Therefore, those amendments—which seek to recognise the value of schools for children whose needs are difficult to meet elsewhere, whether those are special educational needs and disabilities or whether people are choosing to educate in a faith school—seem reasonable.
In summary, this Bill is a fair start, and some businesses will feel it is better than the abyss that might otherwise have been. However, the Government could and should have taken different decisions to protect businesses that will face additional costs in just a few weeks’ time. We are often asked how we would pay for it; I welcome that discussion, as there were many proposals in our manifesto, from taxing big banks to asking gambling companies to pay their fair share. On behalf of the Liberal Democrats, I recognise that the Government have worked quickly to bring this Bill forward, but the risks of losing businesses en route to something better are just too great. We need proper reform, so that the businesses of the mid-21st century can weather the storms ahead.
Adam Thompson (Erewash) (Lab)
I am grateful for the opportunity to speak again on this Bill, having been part of the scrutiny process in Committee.
The Committee heard representations from a wide variety of experts in related fields, and I was heartened by the news that many experts felt that this Bill would have a positive impact on 98% of the retail stores that make up our communities. In particular, small convenience stores such as the local Co-op or the great British corner shop will see great benefits to their capacity to support staffing, security and other operational functions. Our incredible independent shopkeepers, such as those who populate the high streets of Ilkeston and Long Eaton in my constituency, will have more funds to take on additional staff, improve their security set-ups and gain long-term confidence in their ability to serve our community. These measures represent a simple, common-sense approach to rebalancing the scales in favour of local retailers and away from the online giants, and increasing taxes on the biggest players while relieving the burden on local retailers.
Daisy Cooper
The hon. Member may have heard my earlier intervention. He is absolutely right, and I agree with him wholeheartedly, that we have to shift the burden away from small businesses on to big online retailers. However, that could be undermined if all we do is shift the burden on to the big chains. House of Commons Library research says that small independent businesses are going to end up subsidising the big chains. Does he share my concern that this could be an unintended consequence and that the Government must look at it?
Adam Thompson
I refer to Hansard for the discussions we had in Committee, but that did not come through in the evidence we heard. However, I respect the fact that the hon. Member has made that point, and I thank her for doing so.
As we heard from the hon. Member for Mid Dorset and North Poole (Vikki Slade), another sector to benefit significantly from these measures is our local pubs. The fine folk frequenting the Sawley Junction in Long Eaton or the Bulls Head in Breaston in my constituency can rest easy that their locals are in safe hands. More generally, the measures we are bringing forward will reduce the tax burden on the hospitality sector, which is considered by many to be overtaxed. I am very glad that the Government have been able to offer something positive to the sector, which has been broadly forgotten for many years.
Some of the Bill’s opponents have suggested that the removal of charitable relief from non-domestic rates for private schools will have a negative impact on the parents of privately educated children, so I was strongly heartened to hear from one of our experts during the scrutiny process in Committee. Professor Francis Greene, professor of work and education economics at the University College London institute of education, noted that this Bill will have a “marginal” effect on the education sector, and that the policy was fair and would generally not have a great deal of impact on the proportion of children in private schools, which has remained broadly constant over the past 20 years, despite a cash-terms doubling in fees.
Damian Hinds (East Hampshire) (Con)
Would the hon. Gentleman like to reflect on what he has just said, which is that the proportion of children going to private schools has stayed constant? Even the Government’s own analysis does not say that. It says that the number has stayed broadly constant, and in fact the proportion has come down.
Adam Thompson
If I am incorrect, I stand corrected. My understanding from speaking to the experts is that the proportion has remained broadly consistent, but my apologies if that is incorrect. I thank the right hon. Member for his intervention.
The Committee stage reaffirmed what many of us on the Government Benches already knew, which is that this Bill represents a common-sense modification of our tax policy that will support local small businesses. The Bill represents a core pillar of this Government’s goal to rebalance the scales away from large online giants in favour of local independents and towards the 94% of children educated in the state sector. I know that traders and families in Ilkeston, Long Eaton and the surrounding villages in my constituency will broadly benefit from these measures, and I am proud to support this Bill through its remaining stages unamended.
Sarah Bool (South Northamptonshire) (Con)
I intend to confine my remarks to two specific amendments—amendments 3 and 10, on private schools and special educational needs and disabilities—that would delay the introduction of this tax hike so schools have more time to plan financially.
Schools in my constituency have been punished by a series of tax rises since this Labour Government took office in July. By adding VAT to private school fees, and now by ending their charitable business rate relief status, Labour is attacking aspiration. These tax hikes will not hurt the wealthiest. It is the people who have scrimped and saved to send their children to a school of their choice who will be hit the worst. Labour seems to believe people should not have a choice over where they send their child to school, as is evident in their similarly misguided Children’s Wellbeing and Schools Bill, which is making its way through this place.
Schools will close because of this tax hike, and I know this because it is happening in my constituency of South Northamptonshire. Carrdus school, founded in 1957, survived the cold war, the winter of discontent, the global financial crisis and three Labour Governments, yet it could not withstand the tax onslaught from this Chancellor and it will close its doors at the end of the summer term. That will mean 120 pupils flooding back into the state system, which is already struggling with capacity issues, at a huge cost to the taxpayer.
Adam Thompson
Will the hon. Member reflect on my comments a few moments ago about how the expert suggested that the Bill would have a marginal, negligible impact on the education sector?
Sarah Bool
That may be the evidence that you have received in this instance, but I am giving the real-life proof. When I spoke to the headteacher about this, she said that the increase in national insurance on teacher costs, which are about 80% of outgoings, in combination with all the other things, has had a huge impact and the school will have to shut. It will be closing its doors at the end of July, which is a travesty.
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. You said the word “you”, but I did not ask the question.
Sarah Bool
My apologies, Madam Deputy Speaker; I would not dare say that about you.
If the Government are intent on punishing my constituents’ aspiration for the future of their children, the least they could do is grant the concessions that the Conservatives are asking for in all our amendments, and specifically those in amendments 7 and 10. Amendment 7 would exempt private schools that wholly or partially provide education for children with special educational needs and disabilities who have not yet obtained an education, health and care plan, or whose needs are established but not so severe as to require one. SEND support in schools helps pupils with a level of need below that of an EHC plan. Restricting relief only to those settings that provide for the most severe needs is out of step with the rest of our education system. Many families, on not being successful in applying for an EHC plan, or indeed enduring huge waiting times for the local authority to put one in place, opt to send their children to a private school. We should not punish families who choose to do what is in the best interests of their children.
Amendment 10 would delay the introduction of this tax hike for a further year to allow schools to plan their finances accordingly. That is just plain common sense. It would mean fewer schools like Carrdus having to make the unenviable choice to close their doors.
Dr Luke Evans
My hon. Friend has hit the nail on the head: there is a timing issue. The Labour Government were explicit and up front on this tax rise in their manifesto, but they claim that they care about children’s education and welfare. If so, why would they implement the change halfway through an academic year? The hon. Member for Erewash (Adam Thompson) just turned around and said, “Well, it doesn’t matter because it’s 120 kids in the Member’s constituency.” Actually, it really does matter, because every single child’s education matters. Does my hon. Friend agree that even if those are small amounts at the margin, it is completely justifiable to delay the measure as the schools, the experts and the parents have asked for?
Sarah Bool
I totally concur with my hon. Friend, who made the point powerfully. The impact goes beyond the 120 individual students to their parents’ arrangements and how they work. The headteacher of the school has a husband who was also a teacher, and they face a huge impact in respect of what they will do with their children and whether they can manage to make new school place arrangements. This policy is terribly misguided. We really need to think about what we are doing. It is a travesty that we will lose a school.
Sarah Bool
No, I will keep going if the hon. Member does not mind.
I do not want to see any other schools close or any other children suffer as a result of this plan. I hope that colleagues across the House will join Conservative Members in supporting our amendments.
Paul Davies (Colne Valley) (Lab)
I am pleased to speak in favour of the Bill, which is a significant piece of legislation that aims to reform the non-domestic rating system in England. I welcome the Bill’s primary objective of creating a fairer and more balanced approach to non-domestic rating. By increasing the multipliers for large businesses, we will ensure that those entities contribute their fair share to the local economy. That change is particularly important as it addresses the disparity between large corporations and smaller businesses, which often struggle to compete under the current system.
The introduction of lower multipliers for retail, hospitality and leisure properties is a much needed relief for those sectors, which have faced significant challenges, especially in the wake of the covid-19 pandemic. By reducing the tax burden, the Bill aims to support recovery and growth, ultimately benefiting local communities and economies such as the hospitality and retail sector in my constituency.
One of the most notable aspects of the Bill is the removal of charitable relief for private schools. Although private schools play a role in our education system, it is essential to recognise that they operate as businesses and should be taxed accordingly. This change will generate additional revenue that can be invested in public services, including state schools. The Bill represents a step towards a more equitable and balanced tax system. It addresses the needs of various sectors, supports local economies and ensures that all entities contribute fairly to the public good.
Damian Hinds
There are problems with all taxes, which is why we end up with a blend of taxes. For businesses, there is tax on payroll, sales, profits and property. However, business rates are a particularly difficult and unpopular tax because they represent a fixed cost on the business that does not vary when the economy goes up or down, or according to the particular company’s success or growth, or a contraction in its sales or profits.
Over the years, I have heard many times from businesses in Alton, Petersfield, Horndean, Clanfield, Liss and elsewhere in East Hampshire about a desire for business rates reform. I am sure that a lot of small business owners were very attracted to what they heard from the Labour party—that it would to scrap business rates altogether. The Labour Government do not say that any more, but they still want us to believe that they are undertaking some great reform and cutting rates for our high street businesses. I am afraid it is all smoke and mirrors, because for those businesses, including the ones name-checked by the hon. Member for Erewash (Adam Thompson), the big effect that they feel right now is the cut in the relief for retail and hospitality business—not a small one, but from 75% to 40%.
It would be bad enough if that was all businesses faced, but it is not. They have to cope with all sorts of difficulties the whole time. We have rising labour costs—we support the increase in the national living wage over time, but not a hike in employer national insurance contributions at the same time. Because of what is happening to the threshold, there will be a massive effect on part-time workers. That will be very difficult for retail and hospitality businesses to swallow.
In and of themselves, the cuts to the multiplier for high street businesses are welcome, but we must remember that they are balanced by increases elsewhere in the system. Sometimes, Government Members talk about big businesses and corporations as some unwelcome part of our economy, but they are the biggest employers in the country and are fundamental to our economy. In the Red Book, these changes involve increases of hundreds of millions of pounds in business rates. Who will the increased rates affect? They will affect large supermarkets—a sector that is one of the biggest employers in the country—and hotels, which are a really important employer, as well as being fundamental to travel and tourism. Will the Minister also say a word about the expected effect on the national health service?
The blurb on the Budget says, “We are going to attack distribution centres, including those used by online retailers.” The word “including” does a lot of work in that sentence, because high street retailers also have distribution centres, and the changes will add to their costs, fuelling inflation on food and everyday consumer goods.
Dr Luke Evans
My right hon. Friend is making an excellent observation on the impact of these costs. We know from the surveys that 75% of businesses will pass on the costs to the very people who use them. They will have an inflationary impact on the public. Does he agree that it is imperative that we think about that?
Damian Hinds
As ever, my hon. Friend is spot on. In the end, there is no such thing as a tax on business—you cannot tax a business; you can only tax people. Any tax on business is ultimately a tax on its employees, its customers or its owners. Before somebody jumps up and starts talking about the owners, the owners are often pension funds who are then paying out the pensions for our mums and dads.
My point is that these business rate increases will mean higher costs for bricks-and-mortar companies as well, which come on top of all the other changes, in particular the hike in employer national insurance contributions. And this from a Government who yet again this week keep talking about their growth agenda. It makes me wonder what is actually written in that growth agenda.
Overall, the effect of all these changes—we need only look at the Budget Red Book—is that the revenue from business rates is projected to increase from £32 billion this financial year to almost £40 billion in five years’ time. It is a massive further tax raid on business, and a brake on employment and economic growth.
Daisy Cooper
The right hon. Gentleman is giving an impassioned speech about the case for an overhaul of the business rates system. Why did the previous Conservative Government never get around to doing that?
Damian Hinds
Well, I did refer at the start of my speech to the calls over the years for reform. I also said that there are problems with all taxes we levy on individuals or on business and that is why we end up with a blend. What I am talking about now is the fact that this Government are hiking up the total amount that will be taken in business rates, which will fall on major employers and then be felt in our unemployment rate. The Government are trying to do this thing of saying, “We are cutting stuff,” but they are not, because for all of the companies we have heard name-checked, reducing the relief will outweigh the effect of the multiplier. On top of that, we have a revaluation coming up in the near future. That is probably going to mean an increase in rateable values that will compound those higher multiples.
For all those reasons, new clause 2 is both important and a reasonable ask. It says that after a period of time, we should review the real-life effect of these changes and give the Government an opportunity to change course and get back to something that looks a bit like a growth agenda.
I turn briefly to the effect of these changes on independent schools. We have debated in the Chamber on a number of occasions the Government’s overall approach to independent schools. Let me say again that we object in principle to taxing education. It makes us almost unique in the world that we would do such a thing and it will be the first time in our national history that we have done so—it has never been done before by any Labour Government, or any other Government. The tax change we are debating today on rates is not the only tax change or transfer of money from independent schools to the Treasury. They were already facing a big increase—5%, I think—in employer contributions to the teachers’ pension scheme. Like all organisations—public sector, private sector, charitable and voluntary sector—they also have employer national insurance contributions to deal with. And then there is the enormous VAT change.
Specifically on this tax change, it is a fixed cost, as I mentioned at the start of my speech, at a time when there is all this uncertainty around the independent education sector and children will be moving. I will let Members into a secret: no one knows what the ultimate effect will be. We can line up as many experts as we like, but no one knows how many children will be moving, but we know it will be a non-trivial number greater than zero—there will be children moving out of that sector and there is a lot of uncertainty. It therefore seems to be a very unwise time to add, on top of all those other tax changes, a significant change to a fixed-cost tax. The amendments put forward by the official Opposition are therefore very well worth supporting; my hon. Friend the Member for South Northamptonshire (Sarah Bool) made that case very strongly.
On faith schools, we know that whatever the impact assessment says, people of faith, and particularly of smaller faiths, will be disproportionately impacted by this Government’s changes to education. We also know that children with SEND feature particularly prominently in the independent sector. Many of those schools have an awful lot of children who have special needs, but not necessarily—or not yet—an education, health and care plan. Special consideration should be given to both those types of schools: faith schools—if we wanted to narrow it down further, we could say smaller faiths charging low fees to parents—and those catering to children with special educational needs and disabilities.
On amendment 10, with all else that is going on in the independent sector, it is at the very least an exceptionally reasonable ask of the Government that we delay these changes by a year to give the sector a chance to be able to cope and plan.
Deirdre Costigan (Ealing Southall) (Lab)
Thank you for allowing me to take part in this debate, Madam Deputy Speaker. Having been a member of the Bill Committee—my first Bill Committee in this place—I appreciate being able to contribute on Report in the Chamber.
Southall town centre is well known the world over as a great place to shop for an Asian wedding, with stunning lehengas, saris and sherwani on sale all down the Broadway, King Street and South Road. During the election campaign, I vividly recall seeing two clothes shop workers eating their lunchtime rotis behind the counter. When I commented that business must be good, they both said no. They said that a few years ago, they would never have had time for lunch, and would have worked right up until closing as they were so busy. They told me that they were suffering from being undercut by online retailers because they were paying through the nose for business rates, facing blitz robberies with no police around to respond, and constantly having to chase bigger businesses for payments.
It is ironic that the previous Government have suddenly decided they back local businesses after 14 years of ignoring their pleas. In fact, the only businesses they supported were the rail companies that could not run the trains, the water companies that could not keep our water clean, and, of course, the private sector mates they handed out dodgy covid contracts to. Indeed, the former Prime Minister and former Member for Uxbridge and South Ruislip, Boris Johnson, reportedly used a four-letter word beginning with f when making it clear how little he cared about business.
In contrast, this Labour Government are backing local businesses. We are already ensuring that suppliers pay small businesses within 30 days, and we are cracking down on retail crime, too. The Bill will deliver on our promise to ensure a fairer system of business rates that will help brick and mortar shops like those in Southall to compete with online companies. Finally, we will have a permanently rebalanced system that will stop local shops being undercut and stop the slow death of our high streets and town centres.
New clauses 1 to 3 and amendment 9 are all things that are already happening. We are already publishing a review of these measures as part of next year’s Budget, and there is already discretion for local authorities to look at the higher multiplier rate. Amendments 1 to 6 would add manufacturing to the Bill, which would, in my belief, dilute its effect. We have already prioritised manufacturing as part of the Budget, investing £3 billion into aerospace, automotive and the life sciences industries. We make no apologies for using this Bill to prioritise town centres.
Amendments 7, 8 and 10 all seek to either dilute or delay the changes in the Bill. The Bill already exempts all private schools that are wholly or mainly focused on educating children with special educational needs—that is already in the Bill. We know, however, that 93% of children in this country go to state schools. Politics is about priorities. Just as we are prioritising town centres in the Bill, we are also prioritising those 93% of children. Unless the Conservatives think it is okay to have children in state schools taught maths and science by unqualified teachers, they need to say where they would get the money from otherwise.
Although the Bill is about a fairer system of business rates that will help local businesses, many on the Opposition Benches have raised the issue of employer national insurance. Some 93% of businesses in Ealing Southall are microbusinesses. Most of those businesses will either pay less employer national insurance or the same as they currently pay. Some businesses will pay more national insurance, but that is because the previous Government ran up a massive £22 billion credit card bill making rash promises they did not even attempt to keep, while running public services into the ground. When the final demand letters started coming, they hid them in the back of a drawer and pretended everything was fine. Employer national insurance increases for some businesses will help us to pay for the triple lock on pensions, thousands of extra hip and knee operations, and more police on our streets. Again, unless the Conservatives think it is okay to reduce pensions in real terms, let waiting lists go up and up and give our streets over to criminals, they need to say where they would get the money from.
Before Christmas, I met the brewer Heineken at its pub the Star and Scorpion in west Ealing. Labour has already taken a penny off a pint in the Budget and our decision in the Bill to permanently lower business rates for retail and hospitality businesses will help to further protect local pubs like the Star and Scorpion. Without the Bill, the bars and restaurants of west Ealing and Hanwell would be facing a cliff edge in April, with big increases in their business rates as the sticking-plaster solution that the previous Government came up with ends. The Bill both extends temporary reductions in business rates for high street businesses and introduces a new permanent scheme that will level the playing field between the high street and the internet.
The one tax that the Opposition do not mention is the 10p crime tax: 10p added to every shopping basket due to the impact of shoplifting. The Tories did absolutely nothing about that, but this is a Tory tax that Labour is getting rid of. We are investing in neighbourhood policing, scrapping the Tory shoplifter charter that allowed thefts under £200 not to be investigated, and bringing in a new offence of assaulting a shopworker.
The Conservatives had 14 years to help out local businesses like those in Ealing Southall. Instead, they trashed our economy, destroyed public services and stifled business growth. The Labour Government are clearing up their mess. Through this Bill, we are ensuring fairer business rates for shops, restaurants and bars on Ealing Southall’s high streets.
Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)
I, too, served on the Public Bill Committee and would like to put on record my thanks to all the witnesses who attended and gave evidence.
The Bill shines a light on how politics is about choices. At the general election, we promised a Labour Government that would make different choices: choices rooted in fairness and a commitment to levelling the playing field. Today, the Bill is a powerful example of how we are going to deliver on that promise. This is a Bill about the politics of equity. It is about ensuring that everyone—from small business owners to schoolchildren in Wolverhampton North East—has a fairer chance to succeed. For too long, the scales have been tipped in favour of the largest corporations, online giants and private schools, while businesses and state schools have been left to shoulder an unfair burden. The Bill changes that. We are delivering a permanent reduction in business rates for the hard-working small businesses that are the backbone of Wolverhampton North East. My constituency does not include a city centre, but it does contain plenty of brilliant small businesses: fantastic cafés, restaurants, beauty and hair salons, a micropub, larger pub chains and family-run shops. These businesses are the heart of our community.
For years, high streets have been forced to compete unfairly with massive online retailers and retail parks, but the Bill will ensure that the largest online retailers, supermarket chains and distribution warehouses finally pay a fairer share. Small businesses in Wolverhampton and Willenhall will now see permanent lower business rates, freeing up resources to invest in their workforce, improve security and grow. As Paul Gerrard of the Co-op has pointed out, this reform will strengthen the viability of small shops, ensuring that they can continue to provide jobs, beef up security, and uphold their community-centred values. The Association of Convenience Stores has said that these changes will save small stores money that can be used directly to hire more staff, install new CCTV, and invest in the future.
The Bill is, however, not just about businesses; it is about fairness in education. Private school fees have risen by about 55% in real terms over the last 20 years, while state schools’ funding has largely flatlined. State schools and academies are paying business rates right now while private schools enjoy business rates tax breaks, and that is simply unfair. This is the reality. Almost 50% of private school students achieved top GCSE grades this summer, compared with just 20% in state schools. Sports facilities in state schools are crumbling, with fixtures cancelled owing to a lack of minibuses or drivers. Private schools have more swimming pools than all the state schools, further education colleges and higher education institutions put together. Just 35% of children from low-income families can swim 25 metres unaided, compared with 82% from affluent families.
The Bill removes those unfair tax breaks for private schools and reinvests every single penny directly in state schools. That funding will recruit more specialist teachers, provide breakfast clubs in primary schools, and give schools the resources that they need to unlock every child’s potential regardless of their family’s wealth. This is the politics of equity in action. I will continue to support strong, vibrant high streets, brilliant schools, and a fairer future for all.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
Conservative Members do not like to be reminded of the fact that six months ago our Labour Government inherited a £22 billion black hole from their 14 years of Tory rule—[Interruption]—as they are demonstrating now. It is, however, a fact. With that inheritance from the Tories, our new Government are taking much-needed action such as that on which we are voting today. In particular, they are taking action to end tax breaks for private schools across the UK, and it is the education side of this Bill on which I will now focus.
Many of us are here today partly because of the inspiration, teaching and support that an incredible teacher gave to us. I want to pay tribute to one of my teachers at Hermitage academy, which is a state school. Mrs McKeirnan was my modern studies teacher, and a fine job she did too. I fondly remember writing essays about the reasons for Labour’s election win in 1997; they obviously had an impact. However, while we had skilful and energetic teachers like Mrs McKeirnan, what was less satisfactory was that the school roof often leaked when it rained, and sometimes the windows blew in during the winter. That continued until the election of Labour in both Westminster and Holyrood saw my old school being rebuilt.
We can compare that with the situation today in my constituency, where Balwearie high school in Kirkcaldy needs a new building. The funding has not been available during the last 18 years of SNP government and 14 years of Tory rule. My point is that much of our country’s public sector infrastructure is not fit for purpose after years of Tory neglect. To turn that around, we obviously need to raise revenue, and that is exactly what the measures that we are voting on today will do.
Ending tax breaks for private schools is crucial to the record budget settlement for the Scottish Government—the largest settlement since devolution, with an additional £1.5 billion to spend in this financial year and an additional £3.4 billion for next year. For too many in my constituency, the SNP’s record of educational failure has let the party down. Nicola Sturgeon once said:
“Judge me on my educational record”,
and she promised that her Government would close the attainment gap by 2026. Last year, the attainment gap in Scotland widened, and the PISA report showed that reading, maths and science are in long-term decline. Now that the SNP Government have the funding, it is up to them to clear up the mess in education that they have created, which fails young people in my constituency.
Victoria Collins (Harpenden and Berkhamsted) (LD)
I absolutely agree that we need to make sure that there is equity in education. The hon. Lady says that those with the broadest shoulders will carry the burden, but I have a family in Berkhamsted who worked really hard to put their son into private education. Following the changes, Seb has had to change schools after just two years, because the family cannot afford it any more. I make a plea on behalf of the children affected by this policy, because it should be about lifting all of us up, not bringing anyone down.
Melanie Ward
All parents work hard to support their families, and all parents want the very best for their children. Hon. Members would do well to remember that.
The additional £1.8 billion a year, which will be raised by ending tax breaks for private schools, allows us to increase per-pupil funding in real terms and helps to deliver the record budget settlement of an extra £4.9 billion for the Scottish Government. I find it strange that the Conservative party, which in the last Parliament promised to level up the country, should be so opposed to measures that will do exactly that. Indeed, the Leader of the Opposition said that her first act as Prime Minister—I am not sure how many Conservative Members actually believe that the day will ever come—would be to restore tax breaks for private schools. She is obviously not here to defend that statement, but in recent months I have heard little from the Conservatives about what they would cut to pay for that policy. Would they make teachers redundant? Would they cancel breakfast clubs? Would they cut mental health support and careers advice?
At the last election, I was proud to stand on a manifesto that promised to break down the barriers to opportunity. As a state-educated MP, I am also proud to deliver this speech in a Parliament in which 63% of its Members were educated at state comprehensives, with 85% of my party’s MPs being state educated. Indeed, only 4% of children in Scotland attend private schools—even fewer than the 7% in England.
The needs of our students are greater than ever. Young people in Scotland face an annual marking saga, decreasing teacher numbers and a deepening mental health crisis—something that I have raised in relation to my own constituency. It is more crucial than ever that we intervene now to prevent those crises from deepening, and that is what these revenue-raising measures will help to fund. I am glad that this Labour Government have introduced protections for SEND children and military families, but it is necessary for private schools to contribute towards improving educational standards across our country. Let us not forget that they have raised their fees by 75% in real terms since 2000.
I know that parents in my Cowdenbeath and Kirkcaldy constituency want to see their children benefit from the kind of education that their ingenuity, creativity and innate talent deserves. They will be crucial to our future society and economy, and to the kind of country that we want to be. We must make the most of their potential.
In this matter, I take inspiration from Jennie Lee, who attended Beath high school in my constituency and went on to set up the Open University. Her picture hangs in my office. She knew the value of ensuring that high-quality education was available to all, no matter their background and where they lived. If we are to provide that, it has to be paid for, and that is why these measures are so important.
Mr Mark Sewards (Leeds South West and Morley) (Lab)
I am grateful for this opportunity to speak in favour of this Bill, having been involved in its scrutiny at most of its stages. I join my hon. Friend the Member for Wolverhampton North East (Mrs Brackenridge) in thanking all the witnesses who came forward to give evidence to the Bill Committee. I thank them for the evidence they gave and for the useful insight from their respective sectors.
We on the Government Benches are clear that small businesses in the retail, hospitality and leisure sectors should pay lower business rates. The Bill establishes two new multipliers that are lower than the current standard business rates multiplier. In order to pay for these changes, we must ask larger businesses to contribute their fair share so that our smaller businesses can thrive. That is because we on this side of the House know that when we have tax cuts, we need to pay for them with revenue-raising measures—something the Opposition have not quite realised yet. This is a good mechanism that the Government are deploying to save our high streets, to incentivise local investment and to support entrepreneurship. As all Members will know, high streets are essential to local towns and should be given the support they need. I am pleased to say that the measures in the Bill will benefit smaller local businesses such as those on Queen Street, which sits in the centre of Leeds South West and Morley.
In Committee, we heard from Paul Gerrard, who is the board secretariat director at the Co-op. He told the Committee that these changes will help 92% of the Co-op’s retail properties, but he also estimates that they will help 98% of retail businesses because they will have a rateable value that allows them to benefit from these changes. That has to be welcomed. As for those that will pay more to make these changes possible, the higher multiplier will apply to properties with a value greater than or equal to £500,000, including large warehouses that are often used by online giants. They will pay their fair share, and we can start to level the playing field so that essential community high street businesses are on a level playing field with multinational corporations.
Damian Hinds
The hon. Gentleman is right to say that there is a challenge in making sure that things are fair, and we all support a level playing field between the online world and bricks-and-mortar businesses, including in our town centres. There is a thing called the digital services tax, which was conceived while we were in government. Will he say a word about the relative advantages and disadvantages of trying to go after online retailers with business rates changes, which will also affect all manner of other organisations, including bricks-and-mortar retailers, and doing it a different way through a more direct type of tax?
Mr Sewards
I return to the point I made earlier. We know that we have to support these smaller businesses—these bricks-an-mortar businesses, as the right hon. Gentleman calls them—and the only way we are going to pay for this is by finding the money from elsewhere. We have chosen to cut business rates for smaller businesses, and we are choosing to raise the revenue from the larger businesses and corporations that have been getting away without paying their fair share for far too long.
Daisy Cooper
The hon. Member will recognise that it is the Government’s intention to reduce business rates for the smallest businesses, but as I have mentioned a couple of times in this debate, House of Commons Library research shows that if we compare this year to two years’ time, small businesses will end up 80% worse off, whereas the big chains will end up 40% better off. I believe that this is an unintended consequence. Will he urge the Minister, as I am doing, to address that point in his wind-up?
Mr Sewards
I am grateful to the hon. Member for that contribution. Of course I have read the House of Commons Library research into this. I also took time to listen to all the witnesses who came forward in the Bill Committee, and they made it clear that the changes in this Bill will benefit small businesses in the long term. I am quite happy with the evidence that they provided to support the changes that the Bill makes.
Mr Sewards
I will move on to the next part of my speech, but I am happy to take any further interventions that might be relevant to that point. I am going to talk about the amendments now.
I think new clauses 1 to 3 are unnecessary. The Government will monitor the effects of the new multipliers and, as we know, they will show what those effects have been in Budget 2025. They will do the same in all future fiscal statements, so the monitoring is already going to take place. The hon. Member refers to the impact these changes might have in two years’ time, and the Government will comment on that in all future fiscal statements.
Amendments 1 to 6 are noble, but they would significantly affect and reduce the support that the Bill is able to provide to retail, hospitality and leisure businesses.
Victoria Collins
The hon. Gentleman mentions leisure businesses, and I have been contacted by several soft play facilities. They talk about the importance of play to children’s wellbeing, but they are not sure whether they will be entitled to the lower rate. Even Parliament’s experts are not sure. Will the hon. Gentleman support us in calling on the Government to clarify that soft play will be included in those lower business rates?
Mr Sewards
Yes, it would be helpful if the Minister could provide clarity. As someone who uses soft play—[Laughter.] Not personally, enjoyable though it is. I am sure that my sons Oscar and Arthur, who is six months old and not quite ready to take advantage of soft play, will also be keen to know, so perhaps the Minister could offer some clarity in his closing remarks.
Although amendments 1 to 6 are noble, this Bill is about the high street, and we know just how much our high streets have suffered. This does not mean, for one second, that we are backing down from the challenges facing manufacturing businesses, which amendments 1 to 6 aim to help with. The Budget announced over £3 billion to support the manufacturing sector, including £520 million for a life sciences innovative manufacturing fund, but the changes to business rates in this Bill are primarily about supporting our high streets.
As someone who was teaching on this date a year ago, I am particularly interested in clause 5, which removes the charitable relief enjoyed by some private schools. I welcome this, along with the Budget’s broader measures to remove tax breaks from private schools so that we can fund state education properly. A vote for amendment 10 would delay this funding for state schools by another year.
It is estimated that, of the 2,444 private schools in England, only 1,040 will be impacted by the change. The measure will raise around £70 million, which, when taken together with the other revenue-raising measures we have announced, will increase per pupil funding in real terms to benefit the 94% of students who attend state schools. We must give every child the chance to succeed in life, and that is exactly what this Bill and the other measures we have announced are doing.
Damian Hinds
It is worth reflecting that the education budget goes up every year. It does not go up because there has been a change to business rates, VAT or anything else, which is the logic we sometimes hear from Labour Members. If the revenue from those things is slightly smaller than expected, does that mean less money will go into education? Of course not.
We keep hearing about hiring 6,500 more teachers. Does the hon. Gentleman know how many more teachers were hired in the last Parliament?
Mr Sewards
I heard the right hon. Gentleman put that question to the Minister in last Monday’s Westminster Hall debate but, just to go back to his original point—I will come to the 6,500 new teachers—we are deliberately taking these decisions in order to increase the amount of money that state schools have to teach the 94% of students who enjoy state school education.
As a basic principle, all Members of this House can get behind the idea that it is a basic function of the state to provide a well-funded, excellent state school place for all students, whether or not parents choose to take advantage of it. That is exactly what we are doing with this Bill and the other measures we have announced.
Dr Luke Evans
Talking of basic principles, does the hon. Gentleman therefore believe it is right to tax education—yes or no?
Mr Sewards
I believe it is right to tax businesses. Private schools are businesses, and we are choosing to levy the tax on businesses. We are not choosing to levy the tax on state education, because as I was just setting out, it is imperative on us to make sure there is an excellent and well-funded place in state-funded education for all students, should parents choose to take advantage of it. It must be remembered that not all parents have the choice of private or state education. The reason why 94% of students are in state education is because that choice does not exist for most parents in this country. That is why we will take the necessary action to fund state schools properly.
I will make some progress because I can see that Madam Deputy Speaker would like me to—oh, she is being quite generous with her time. Thank you, Madam Deputy Speaker. In which case, I will take more interventions.
Some Members have raised concerns about whether the legislation adversely affects the private schools that are primarily concerned with teaching students with EHCPs. I am pleased to report that it does not. The Government have clearly set out that private schools that teach 50% or more students with EHCPs will continue to be exempt from business rates, which is exactly the right approach. There are therefore no concerns there.
Amendment 8 seeks exemptions for certain kinds of schools. We have talked a little bit about faith schools, and we talked about that a lot on Second Reading. I cannot support the amendment given that we are ending the tax breaks to support the 94% of students who attend state schools. If we dilute the measures in the Bill for that exception, it is easy to make an argument for the next exemption, the one after that and the one after that as well. Our guiding principle should be that every child is entitled to an excellent, properly funded state school place, as I think I have said repeatedly.
Amendment 9—the last one I will speak about—gives local authorities discretion over whether the higher multiplier will apply. As many hon. Members will know, local authorities already possess wide-reaching powers regarding discretionary rate relief. Given that the Bill does not affect those powers at all, I do not think the amendment is required.
To conclude, the measures in the Bill are vital to bring about the restoration of our high streets, support local businesses and give state schools the funding they desperately need. Those are the priorities of this Labour Government and my priorities too. If Conservative Members claim to represent the party of business again, if they ever hope to seize back the mantle of being the party of opportunity, I hope they put their money where their mouth is and join us in voting for this unamended Bill today.
Madam Deputy Speaker (Ms Nusrat Ghani)
I thought it very sensible for the hon. Member to clarify that it is young Arthur, not himself, who enjoys soft play. I call the final speaker, Chris Vince.
Chris Vince (Harlow) (Lab/Co-op)
As I have about two hours to give this speech, I want to start by going back to the summer of 1983—[Laughter.] I have just told everyone how old I am, have I not?
Thank you, Madam Deputy Speaker, for the opportunity to speak in this debate. I also thank the Minister for all his work on the Bill. I genuinely want to thank all Members from across the House too for their contributions in Committee. I thought the way in which the Bill was discussed in Committee and the contributions from both sides were well thought out and, as I have mentioned before, respectful—I say that in advance of any interventions. I also want to thank all the people who came forward to provide evidence to the Committee.
I am honoured to rise to speak on Report on behalf of my constituency of Harlow. First—I promise I will not take two hours—I think everybody in the Chamber will forgive me for taking the opportunity to thank and praise the hard-working teachers and school support staff across my constituency for the hard work they do day in, day out to support young people.
I had a wonderful opportunity to visit Mark Hall academy in my constituency last week and saw the incredible work that its staff are doing to provide an inclusive atmosphere. I particularly welcomed the fact that the school was about not just exam results, but what I describe as the hidden curriculum—how young people grow and develop. The school also focuses on the importance of debating skills, which may be of particular interest to the right hon. Member for East Hampshire (Damian Hinds)—I am only joking. I thought that perhaps he and I could go together and learn a thing or two. [Interruption.] I set myself up for that. The school also recognises the importance of critical thinking. As I say, it was a fantastic visit, which was capped by an opportunity to meet the young carers in the school. As many Members will know, young carers are a hugely important issue for me.
I will briefly address private schools, as they have been mentioned a number of times. As I said on Second Reading, private schools affected by this policy can choose to absorb some of the cost if they so wish, and that is their prerogative. Members across the House may disagree with this, but, ultimately, the fundamental issue here is fairness and equality.
Sarah Bool
The hon. Gentleman mentioned that private schools could absorb the cost. The headteacher of my Carrdus school told me that they could not absorb the cost. The school has tried everything possible to stay open, but it cannot. One just cannot make this claim that these schools can absorb the cost; they cannot.
Chris Vince
I thank the hon. Lady for her comments. Having spoken to headteachers in private schools, I know that that is what some of them are looking to do. I recognise that may not be the case in that situation. As I said on Second Reading, ultimately, we want all schools to be at such a standard that parents do not need to choose to send their children to private school.
Every business in the UK is required to pay VAT. The “Cambridge Dictionary” definition of a business is a particular company that buys and sells goods and services. Parents pay for the service of their children’s teachers, and they pay for their children to go to private school.
Blake Stephenson (Mid Bedfordshire) (Con)
Does the hon. Gentleman think that universities are companies? If he does, would he advocate imposing VAT on fees for university education?
Chris Vince
I thank the hon. Gentleman for his question, but I think that we have had a very good debate on higher education today. It is interesting that Conservative Members want to talk about university and higher education when it is in an awful state. Clearly, we need to look at how private schools are funded. [Interruption.] I am being a teacher, sorry. Members can carry on rambling; this is not a school.
The second part of my speech is about our high streets. I think we can all agree about the importance of supporting our high streets, while also recognising the changing nature of both retail and those high streets. The Bill is designed to decrease tax on high street businesses and make online retailers pay their fair share. Very briefly, in its evidence, the Co-op said that the Bill would benefit “92% of our estate”, which is 98% of retail stores, and described it as having “a significant impact”. The representative of the Association Of Convenience Stores described the Bill as very helpful, and
“very positive for the sector, but…also very positive for the places where they trade.”––[Official Report, Non-Domestic Rating (Multipliers and Private Schools) Public Bill Committee, 11 December 2024; c. 18, Q25.]
I have not taken two hours, Madam Deputy Speaker, but I will conclude. I welcome the Bill. I welcome the practical steps that this Labour Government are taking to address the issues left by the previous Government and to support small businesses in my constituency of Harlow and across the country.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It appears that the attraction of business rates has not been sufficient to draw as many speakers to the Chamber as some debates, but I am none the less grateful to all Members for their contributions to today’s debate.
Just a few months ago, we exposed a £2.4 billion black hole in the local government budget: £3.7 billion of additional spending was announced, with only £1.3 billion of funding to pay for it. Over the weeks since the Budget, we have seen pensioners, businesses of all sizes and types, schools, landlords and tenants all facing additional costs to begin to backfill the consequences of those political choices. With the Bill before the House tonight, those tax hikes are heading for the business rates bill of companies and organisations, large and small, on high streets the length and breadth of the country.
We should not pretend that this is an essential step. Our councils are acknowledged as the most efficient part of the public sector. They responded magnificently to the consequences of the financial crash in the late 2000s, with rising resident satisfaction against a backdrop of increasingly challenged budgets, but the decisions made by this new Government, in particular loading an additional £1.66 billion of national insurance costs on to local authorities, with less than a third of that covered by the promised additional funding, has consequences in our town halls. The Bill begins to make a small step towards bridging that colossal gap, but the Government need to own these political choices. The consequences of the Bill for our businesses and schools are stark.
First, let me address the changes in the multiplier, and in particular the consequences for larger premises. Under the changes to the business rate system introduced by the Government overall, increased costs loaded on to larger premises will provide the source for any reductions for smaller businesses, unlike under the previous Government, when it was covered from general grants. As a result, these businesses, often small and medium-sized enterprises—important employers and vital sources of growth for our economy—will face higher bills.
Such businesses have been characterised by the Government as warehouses, often owned by online giants, but when we look at the detail from the Government’s own data, we see firms such as Banner, which supplies the offices of Members of Parliament with all kinds of stationery products, Tygavac Advanced Materials Ltd, and Zetex Semiconductors plc, which is an American-owned business that trades on the London stock exchange, producing products that are vital for our security and growth. Those are just examples of businesses in the Minister’s own constituency that will be hit by the changes. Scapa Group Ltd, a major healthcare provider in the constituency of the Secretary of State, will also face significantly higher bills.
We have heard Members wax lyrical about how much they value the opportunities for growth in this country, and how they value in particular different types of community assets, but 28 of the data centres that the Prime Minister speaks of as being vital to the AI agenda will be hit by the Bill, and 16 of the breweries that have supposedly benefited from a penny off the pint, including Fuller’s, Bulmers, John Smith’s and Greene King, all face significant increases in their bills. Eight zoos and safari parks, including Colchester, Bristol and Chester zoos, face significantly increased business rates bills, and 48 stadiums across the country, including Wimbledon, Twickenham and both the Manchester stadiums, all expect to see big rises as a consequence. All Labour Members who love to champion their local pub and talk about taking a penny off the pint need to remember that the consequence of the Bill is to put business rates up by, on average, £5,500 a year per pub. The list is available from Government data. It is very clear that this will be a difficult Bill for retail, hospitality and leisure to swallow, after a period of direct and specific support from the previous Government.
This change does not come from a Government that came to office saying that this was their intention or plan; it comes from a Government whose Chancellor—Rachel from accounts—went so far as to promise in 2021 that she would abolish business rates. Business owners and workers who thought they were voting for a Labour Government that would come in and abolish business rates are facing significant increases today.
Dr Luke Evans
We have heard categorically from Labour that private schools are businesses. They see themselves as part of the community and as charities. Now that they are seen as businesses, they will act as businesses and will have to look to raise revenue from all their sports facilities and anything else that they willingly gave away to the state system. Private schools work with the state system and ensure that there is support for the state system—that is the community basis of what schooling is about. Does my hon. Friend share my concern that defining them as businesses will be a big problem?
David Simmonds
My hon. Friend highlights a point that many of us will have heard from our local state schools: the fact that they are in sharing arrangements with private schools to access facilities. They are concerned that, as the cost drivers introduced by the Government and the Budget increase the pressure on those schools, they may lose the free or low-cost access they have.
Lewis Cocking (Broxbourne) (Con)
I had a meeting with a state school in my constituency that said the changes will be damaging because it gets a grant from a private school, which will have to be cut to deal with the impact of VAT. That state school, which is in a genuinely working-class community, will be £200,000 a year worse off under this policy. Does my hon. Friend agree that that is terrible?
David Simmonds
I agree that it is terrible, but sadly it is typical of the consequences introduced into the system by the actions of the Government.
Melanie Ward
Does the hon. Gentleman agree that state schools should not have to go with a begging bowl to private schools to ask to borrow their facilities? They should be properly funded in their own right.
David Simmonds
Having served as a governor in three different state schools during my local government career, I know that many state schools have facilities that they are very happy to share—some have swimming pools, some have libraries, some have adult education facilities. The sharing of facilities among schools of all kinds is normal, but the Bill introduces additional pressure that will take away access to those facilities. Isolated communities in particular, which benefit most from that access, risk losing it.
The basic fact that schools will end up net worse off demonstrates that, contrary to what has been said, this policy fails the basic test of equity and efficiency. It harms some people in our country, with no corresponding benefit to anybody else. Let me address the argument proposed by a number of Members that the consequences are marginal. We heard a lot of evidence from different people. The hon. Member for Erewash (Adam Thompson) referred to an academic who has built a career writing tracts attacking the private education sector. That is not somebody I consider to be an expert. I will take the word of mums and dads, the Independent Schools Council, institutions that represent people across our country and the House of Commons Library over the word of a single left-wing academic.
The hon. Member for Wolverhampton North East (Mrs Brackenridge) said, “It’s not fair because schools in the state sector pay business rates.” She may not be aware that there is already an 80% mandatory business rate relief for voluntary aided, foundation and academy schools, and 100% of all state school business rates liability is paid for by central Government anyway, so no school budget is burdened by the cost of business rates, whereas the consequence of the Bill will be that every independent school is burdened by those costs.
Many of us in this Chamber will see the added value that independent education brings. Many of those experts whose opinion we value have spoken profoundly about the fact that so much of our special educational needs provision is in the private sector. I made reference in Committee to Gesher school in my constituency. I defy any Labour Member visiting Gesher to come away saying, “That is a private business that deserves to be taxed.” Such institutions have emerged—in many cases over a long time—to cater to very specific and profound special educational needs and disabilities, and they are looking aghast at the consequences of the Bill.
There are a number of reasons for that, some of which are technical. The Government’s solution is to introduce the “wholly or mainly” provision. Schools that wholly or mainly provide places for children with an education, health and care plan—by which the Government mean 50% or more—will be exempt from the provisions. The problem with that policy is that many children who have well-established, diagnosed special educational needs and disabilities do not have an education, health and care plan.
Indeed, beneath statementing, which was the term at the time, the previous Labour Government introduced a number of tiers: school action and school action plus. Children with moderate to severe special educational needs and disabilities could fall into those categories and be supported in a mainstream setting. The statementing and education, health and care plan process was only ever intended to make provision for children with the most significant and severe needs. That is already the case across the state sector. We know from the evidence of many parents up and down the land that they found provision in local independent schools, and at their own cost, for children who had not qualified or had not yet achieved an education, health and care plan. It is very clear that the Government’s solution underestimates, and falls well short of accounting for, the number of children with special educational needs and disabilities. This is a Government whose Secretary of State for Education stood at the Dispatch Box last week and talked about how much they believe in inclusion. Well, their actions in support of this Bill say otherwise.
The Bill also fails to address the needs of parents who wish to secure a place for their child at a school that has a special character. This is particularly important in rural areas, but it is an issue across the country. We all know that there are schools that have the ability to provide specialist training or coaching in a sport that a child excels in and wishes to pursue, and there are schools that have a faith or cultural identity that is incredibly important to the family.
By requiring all those types of school to pay these significantly hiked taxes, this Government are bearing down on choice in the education sector and pushing up costs for mums and dads. These are not wealthy families, but ordinary people in this country who are seeking to do the best for their child and who, in some cases, are willing to take on the responsibility of paying for their child’s education even if they could still pursue the opportunity of an education, health and care plan for them through the state system. They choose to do the right thing by their child, and this Government will be penalising them.
The amendments we have tabled seek to address the shortcomings I have described as best we can. We will also support some of the amendments tabled by other parties where they clearly fulfil our shared objectives, but as the speeches and other contributions to this debate by Conservative Members have shown, there could have been so many more amendments seeking to get this Bill right.
In conclusion, all of the hereditaments that are covered by this Bill are important to our economy and to growth, and in many cases they are vital to our communities. Since the Chancellor’s Budget, growth has flatlined, inflation has revived, borrowing costs are rising and employment opportunities are diminishing. It is not too late for this Government to choose a different path, and we invite them to do so this afternoon.
The Minister for Local Government and English Devolution (Jim McMahon)
Before I speak to the amendments tabled by the hon. Members for Mid Dorset and North Poole (Vikki Slade), for Ruislip, Northwood and Pinner (David Simmonds) and for St Albans (Daisy Cooper), I thank Members from across the Chamber for their contributions and for the constructive spirit, by and large, in which they have engaged with the Bill since its introduction. Although they are not always seen, with evidence sessions and Committee stages not always being prime-time TV viewing—it is a curse, but that is the way it is—those deliberations are nevertheless essential. The contributions that were made by Members from all parts of the House in probing and scrutinising the Bill were valuable, and I hope that all Members found them interesting.
I will begin by speaking to the amendments concerning the impact of the new multipliers. New clause 1, tabled by the hon. Member for Mid Dorset and North Poole, would require the Secretary of State to review the impact of clauses 1 to 4 on businesses, high streets and economic growth within six months of those clauses coming into effect. The hon. Members for Ruislip, Northwood and Pinner and for St Albans have proposed two other new clauses. New clauses 2 and 3 would seek to impose in legislation a requirement for an analysis of the impact of the new business rate multipliers at varying points ahead of, or following, implementation of the Bill. New clause 3 also seeks to require an assessment of how the application of the new multipliers would differ between retail, hospitality and leisure businesses occupying different numbers of properties, and to compare that assessment with the impact of retail, hospitality and leisure relief from the 2020-21 financial year to the 2025-26 financial year.
We agree in principle with the points that hon. Members have raised through their new clauses. It is right that the Government consider the effects of their policies on businesses, on the high street and on economic growth, and indeed within different sectors. It is the policy of the Government that those businesses should feel a material benefit as a direct result of these measures, so let me set out how we propose to do that.
It states in the Bill that the two new retail, hospitality and leisure multipliers may not be set at more than 20p in the pound lower than the small business multiplier. The Bill also places appropriate restrictions on the higher multiplier: when it is set, it cannot be more than 10p in the pound above the standard multiplier, and cannot be applied to properties with a rateable value of less than £500,000. It is important to state that those are not the intended tax rates, but the maximum parameters to be introduced through the new business rate multipliers. As we explained during the Bill’s passage through the House, the actual tax rates will be set at the 2025 Budget, taking into account the effects of the 2026 business rate revaluation, as well as the broader economic and fiscal context at that time.
Daisy Cooper
The Minister has been here throughout the debate, and he will have heard a number of my interventions. I accept his point that those figures will not be published until Budget 2025. May I ask if he is in a position to give a cast-iron guarantee that small independents, with a small number of hereditaments, will not be subsidising organisations that have many, such as the big chains?
Jim McMahon
I did hear the hon. Lady, and I think we all accept the principle of needing to target or get support to those important small businesses, which we can all identify in our constituencies. With respect, I think there was a degree of conflation with the temporary reliefs brought in during covid, which the previous Government did not account for, that were always going to come to an end.
Our challenge was how to reconcile ongoing support for the high street with a permanent relief in law so that businesses know exactly where they are and can plan ahead with certainty. The choice we made was far fairer: to target higher-value properties of more than £500,000, which are generally—but, I accept, not entirely—the large-footprint warehouse and distribution premises used by the big online retailers.
The shadow Minister used the example of the stationery provider in my constituency. It is an online retailer, so it ought to be paying more. Why? Because for a long time—and we have all heard this from our constituents and industry—we have needed a rebalancing from online to on-street and from out-of-town to in-town, and that is exactly what this targeting does. It was never intended to be a continuation of the relief that was only temporary during covid. It is about rebuilding the foundations, and that is exactly what we have set out to do.
Daisy Cooper
I completely accept that point, and I am very sympathetic to the fact that the Minister inherited a sticking-plaster system from the previous Government. If during the course of this year his Government’s own analysis proves what I have discovered from the House of Commons Library research, will he ensure that the Government at least do not rule out introducing a new small business relief in a targeted way to support such small independent businesses?
Jim McMahon
As with all tax policies, we will keep this under review, and I say that in a very general sense. We absolutely believe that the businesses that are the backbone of our high streets, town centres and communities would, were it not for these measures, go bust. They would not be viable and they would feel the heat very quickly. However, because of the measures we are taking, businesses will be able to plan with certainty for the future, knowing that they have a Government acting in partnership with them in that enterprise.
David Simmonds
I appreciate the Minister’s point, but clearly no Parliament binds its successors, so every Parliament must make its own decisions. A lot of Members have asked about small business rate relief. It would be helpful to have some certainty from the Dispatch Box about the Government’s intentions on that. Can he give us that certainty tonight?
Jim McMahon
I can certainly give the certainty that we are providing in law for a permanent relief for retail, hospitality and leisure businesses, and we will fund that through a very targeted additional payment for properties of more than £500,000, which will primarily be the online retailers occupying big warehouses and distribution centres. It is a promise to shift from the online to the on-street, as I talked about.
Before we move on to vote on the amendment, I will make some progress. The House will know that tax policy and legislation are not subject to the same requirement for the impact assessments that accompany non-fiscal policy decisions. Nevertheless, the Treasury is committed to publishing an analysis of the effects of any multipliers at Budget 2025, which we hope will go some way to reassuring hon. Members that we will be considering the impacts of this policy carefully before the new rates are set.
The Government will continue to keep the policy and its effects under review as a matter of course, because we believe it is good practice to do that for all taxes. However, we want to make it clear to hon. Members that the Government have heard them, and we understand the importance of robustly understanding tax changes, which is something to which we have already committed. I hope this commitment to understanding the effects of the new tax rate when it is introduced will enable hon. Members not to press their proposed new clauses.
Amendment 9 would give local authorities discretion over whether the higher multipliers enabled by the Bill should be applied. The Bill would enable the Treasury, through regulations, to introduce permanently lower multipliers for qualifying retail, hospitality and leisure properties, and to fund this by introducing higher multipliers for properties with a rateable value of £500,000 or more. As we explained in Committee, we do not have any plans to narrow the scope of the higher multipliers as doing so would reduce the funding available for the very targeted support for lower multipliers for uses that everyone in the Chamber supports.
That does not mean that local authorities will be unable to apply local discretion to rate bills. As was set out in contributions, local authorities already have wide-ranging powers for discretionary rate relief as set out in section 47 of the Local Government Finance Act 1988 where the authority is satisfied that that would be reasonable, having regard to the interests of council tax payers. We assure the House that those discretionary powers are unaffected by the Bill and remain in place. Given that local authorities will be able to use those discretionary powers to provide relief, including for ratepayers subject to the higher multiplier, the amendment is not required. I hope that assures hon. Members.
I turn to amendments 1 to 6, which would widen the scope of the lower multipliers so that qualifying manufacturing properties would become eligible alongside retail, hospitality and leisure properties. In the Bill Committee, the hon. Member for Newton Abbot (Martin Wrigley) spoke of the vital importance of manufacturing to the British economy and of how providing them with a permanent cut to their business rates could help them to recover.
Let me reiterate the Government’s support for the manufacturing sector as a whole. It is said that Britain is a nation of shopkeepers, but it is also a nation of innovators, creators and entrepreneurs. Our manufacturing sector helps bring many of those ideas to life, and we understand its importance. But the Government must also support our high streets—the hoteliers, restaurateurs and publicans—and that is especially important with a property tax such as business rates as those sectors rely on good locations, which in the business rates system are often valuable locations. If they did not have that targeted support, they would feel the hit very strongly.
Through the Bill, we are delivering our manifesto pledge to protect valuable town centres and high streets by enabling the introduction of permanently lower taxes for qualifying retail, hospitality and leisure properties from 2026-27, ending the uncertainty of the annual retail, hospitality and leisure relief that has been rolled over year on year since the covid-19 pandemic. We have been clear throughout the process that this tax cut must be fully funded. Therefore, against the current fiscal backdrop, a widening of the scope of properties eligible for the lower multipliers might dilute the support that the Government were able to provide, or its impact might even require a higher tax rate for properties with values of more than £500,000 to fund such new multipliers. However, we respect hon. Members’ points of view and agree that our manufacturing sector should be recognised and supported.
Advanced manufacturing is one of the eight growth-driving sectors identified as part of the Government’s industrial strategy. At the autumn Budget, the Government announced £975 million for the aerospace sector over five years, over £2 billion for the automotive sector over the same period, and £520 million for the new life sciences innovative manufacturing fund. That is how the Government intend to support the innovators, creators and entrepreneurs mentioned earlier. Because we have this package in place to support manufacturing, we cannot accept the amendments, but I hope that I have been able to provide hon. Members with reassurance as to our commitment to support the sector, which I am sure the whole House recognises is vital.
I turn to amendments 7 and 8. While clause 5 will remove business rates charitable relief from private schools, the amendments would introduce new provisions or expand existing provisions in the Bill to ensure that certain private schools remain eligible for business rates charitable relief. Amendment 7 would result in a fee-paying school retaining its relief if it wholly or mainly catered for pupils with special educational needs as defined under section 20 of the Children and Families Act 2014, whether or not those pupils have an education, health and care plan. Amendment 8 would result in a private faith school or a private school with a special character maintaining its eligibility for charitable relief if there were no maintained or academy school of the same faith or special character within the statutory walking distance set out in the Education Act 1996. Although amendment 8 does not indicate what may constitute a special character, we understand from previous contributions in the House that that would include schools that follow a particular method of education. Amending the basis on which fee-paying schools are eligible to retain their charitable rates relief in the manner in which the amendment proposes would undermine the Government’s intention to remove tax breaks for private schools. As we have said, the removal of the tax break is necessary to fund school support for the over 90% of pupils who are educated in the state sector.
The Government have carefully considered their approach to minimising the impact on pupils with the most acute needs. The Bill provides that private schools that are charities and that wholly or mainly—by over 50%—provide education for pupils with an education, health and care plan will remain eligible for charitable relief. As hon. Members will be aware, most children with special educational needs, with or without an EHCP, have their needs met in mainstream state-funded schools. If an EHCP assessment concludes that a child can only be supported in a private school, the local authority directly funds that place.
Where an EHCP has not named a private school, the parents or carers of the child may choose to place that child in a private school, but that is a choice made by the parents and does not detract from the assessment that the pupil’s needs can be catered for in the mainstream state-funded sector. In instances where a child’s parents disagree with the local authority’s assessment that their needs can be met in the state sector, the EHCP system is the most appropriate channel to resolve such disagreements.
The Government are aware of the concerns raised by hon. Members and others that pupils with special educational needs in private schools may lose their charitable relief. The Government believe that most private special schools will not be affected at all by the Bill. In fact, we expect any private special schools losing eligibility for private relief to be the exception; according to our assessment, they could be in the single figures. It is important that we keep it in that context.
Jim McMahon
I do not have time for any more interventions.
Private schools that benefit from the existing rates exemption for properties that are wholly used for the training or welfare of disabled people will continue to do so. The majority of children in England with special educational needs, with or without an EHCP, have their needs met in the state sector already. The Government’s ambition is for all children and young people with special educational needs or a disability to receive the right support to succeed in their education as they move into adult life.
As Members know, all schools are required to follow the Equality Act 2010, which includes fostering and promoting an environment that encourages respect and tolerance of children and families of all faiths and of none. We have listened carefully to arguments relating to exempting faith schools from the Bill, and we have decided that a carve-out for faith schools or schools with other special characteristics cannot be justified. For those reasons, we are unable to accept amendment 8.
Finally, amendment 10 would delay the removal of charitable rates relief from private schools by one year to April 2026. To eliminate barriers to opportunity, we need to concentrate on the broader picture of the state sector, where most children are educated. Ending the tax breaks on VAT and business rates for private schools is a tough but, in the end, necessary decision that will secure additional funding to help deliver on the Government’s commitments to education and young people. Together, these policies are expected to raise over £1.8 billion a year by 2029-30—essential funding to improve the education of the vast majority of school-age children. Delaying their implementation would forgo about £140 million, which, frankly, cannot be justified.
The House has heard a good range of amendments to the Bill, and I hope that I have been able to address them all. Although we are not able to accept the amendments, I hope that the assurances that I have outlined are accepted and Members feel able to withdraw them. If not, the Government cannot support them.
Question put, That the clause be read a Second time.
Jim McMahon
I beg to move, That the Bill be now read the Third time.
I take this opportunity to acknowledge all who have contributed to the Bill’s passage through this House, particularly my private office team, for the support that they have offered during this process, officials in my Department, for the outstanding work that they have done, and colleagues in the Department for Education and the Treasury, as well as Clerks of the House, for supporting the process of this Bill.
The Bill honours the Government’s manifesto pledge to end business rates charitable rate relief for private schools in England and to fundamentally reform the business rates system. We are kickstarting this endeavour through the introduction of lower tax rates for retail, hospitality, and leisure properties.
I thank all Members who contributed to the evidence sessions, the Committee stage and today’s debate. I hope, even though there were disagreements on parts of the new clauses and on the amendments, that there is at least an acknowledgment that we have gone a long way to ensure that we get to the heart of what this Bill is intended to do when it comes to the high street and our town centres. In the end, whatever the differences—and let us be honest there are plenty—we all know how important our small businesses are to the viability of our high streets. We all recognise that these are more than just places in which to do business; they are places that people look to as the heart of their community. They are always more than the sum of their parts. Hopefully, Members will see that these measures will really make a dent in this area.
I also place on the record our thanks to those who gave evidence to the Public Bill Committee, including: the Institute of Revenues, Rating and Valuation; the British Retail Consortium; the Co-op Group; M&S; the Shopkeepers’ Campaign; the British Property Federation; and the Independent Schools Council. They have enabled us to scrutinise the Bill properly and to get evidence from professionals who understand what things are like on the ground, and that, I believe, added value to the process.
I thank those who attended and gave evidence in Committee for their time and willingness to share their expertise. I also wish to extend my thanks to hon. Members who attended the Public Bill Committee to ask questions, to foster debate, and to contribute to discussions as we take these important first steps to transform the business rates system.
The Bill will help to secure additional funding to enable the Government to deliver their commitments to the majority of children who attend state schools, which is the second part of this Bill. Ending tax breaks for private schools is a tough but necessary decision. It will come as welcome news to most parents in England, as it represents the Government’s determination to break down the barriers to opportunity and ensure that all children get a high-quality education. Let us be absolutely clear: more than 90% of children in this country go to state schools and they deserve the best, too. Now they are going to get it.
Let me assure Members that the education system in England is prepared for the relatively small number of pupils who may move as a result of the measures in this Bill. Much of what we have heard about churn in the system is not supported by the evidence and, in the end, it runs the risk of scaremongering. We need to reflect on the fact that there has always been change in the system, even before these measures were introduced. Importantly, we are organising to make sure that parents and pupils receive support if they need it, but we believe that will be around the edges.
The Bill will also provide certainty to high streets by making provision to introduce a permanent tax cut for retail, hospitality and leisure properties. We have heard a lot about the change from the covid relief to the permanent, baked-in relief that we are providing through the Bill. The Opposition have said a number of times during the Bill’s passage that it represents a reduction, but a degree of honesty is required. The Opposition know, as do we, that there was no provision—not a single pound or penny—for the continuation of the temporary relief provided during covid on which retailers, hospitality providers and leisure providers were relying.
The Opposition know that that is a fact, as do we. The only difference is that while the Opposition were willing to political point score, while businesses were waiting for maturity and for an answer to the problem, we were getting on with the job of government, and providing the permanent support that businesses need. How will we pay for it? We have heard the Opposition say a lot that they do not support measures, but they always support the investment. They support the investment in state schools, but not the measures to generate the income. They support the measures to support high streets, but seem not to support the measures to ensure that premises with a value of £500,000 or more pay more into the pot.
The reality is that this has not just come out of the blue. The Conservatives had 14 years to address the imbalance from the online to the on-street, from the out-of-town to the in-town, and they did nothing, so it is, frankly, ridiculous for them to try to present themselves during the passage of the Bill as the champions of enterprise, of our town centres and of small businesses. They now have an opportunity. We have sorted out the amendments—they were nonsense, and most people would accept that—but on Third Reading we get to vote on the substance of the Bill. The Opposition could do the right thing. They could change course and back support for state schools to get them the money that they need. They could back measures to get money to the high street in our town centres and do the right thing. Now is the time to show that they will be the mature Opposition that they promised to be, but I expect that that will not be the path they choose. Luckily, the Government are getting on with the job. I commend the Bill to the House.
Madam Deputy Speaker (Caroline Nokes)
I call the shadow Secretary of State.
Kevin Hollinrake (Thirsk and Malton) (Con)
I thank the Minister, and indeed my shadow Ministers, the other Opposition spokespeople and all parliamentarians who have helped with the passage of the Bill, as well as the Clerks and officials—not that I would like to see the Bill progress any further. Aristotle, in his book “Politics”, over 2,000 years ago—[Interruption.]
Kevin Hollinrake
Over 2,000 years ago, Aristotle talked about deviant government. Alongside tyranny, he placed democracy. He said the risk is that, sooner or later, a Government will come along who represent only their own interests and those of their supporters, and that that Government will pursue the politics of envy. Let us see who the Minister’s supporters are. They are not the 12.6 million pensioners in this country, if we judge by the winter fuel allowance; not the 89,500 farmers whose livelihoods will be damaged by the family farm tax; not the 5 million businesspeople who will be damaged by the changes to business property relief, who employ 14 million people and pay £200 billion a year in taxes; not those people who live in rural areas; and not the families of the 550,000 young people who are in private and independent education. According to the Institute for Fiscal Studies—this is not scaremongering —90,000 of them may go back into the state sector as a result of the Government’s choices.
The Government have the gall to say that the fact that business rates or VAT do not apply to school fees is a tax break. It is no more a tax break than there being no VAT on housing, children’s clothes or food. Those measures are there because we should encourage people to pursue education, particularly those who scrimp and save to send their children into private education.
What about businesses? Businesses are suffering on the back of the employer national insurance rise of £25 billion a year, and are worried about the future because of the withdrawal of business property relief and agricultural property relief. The reality is that this Bill means a cut in support for many of those whom the Minister said he seeks to protect—people who work in the retail, hospitality and leisure sectors. The 75% discount is down to 40%. That will mean a tangible difference for the average pub of £5,500 a year. That comes on top of the huge increases in employer national insurance. Some 250,000 businesses will be worse off to the tune of £925 million. That is the tax charge he is placing on those businesses he says he seeks to protect. If he is honest with them, those taxes will go up again in April 2026. That is the reality of the situation.
What promise did Labour make before the election? They said they would scrap business rates completely—another broken promise. In their manifesto, they said they would change the balance between high streets and the online giants. That is not what the Bill does. The Bill also taxes breweries, airports, football stadiums and bricks-and-mortar retailers such as John Lewis, Sainsbury’s and Morrisons. That is the reality behind the Government’s changes: not scrapping business rates, nothing on the online giants and big taxes on many businesses. This is the politics of envy. It is the tyranny of socialism, and that is why we will vote against the Bill.
Question put, That the Bill be now read the Third time.
Business without Debate
(3 days, 7 hours ago)
Commons ChamberRead Full debate Read Hansard Text
Endometriosis: Women in the Workplace
(3 days, 7 hours ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Gill Furniss (Sheffield Brightside and Hillsborough) (Lab)
I am grateful for this opportunity to raise the plight of women with endometriosis and the everyday struggles they face in the workplace.
Endometriosis was first identified in 1860, but progress in improving the lives of women suffering from it has moved at a glacial pace since then. As the Women and Equalities Committee so accurately put it:
“Women and girls are missing out on their education, career opportunities, relationships, social lives and are having their fertility impacted because of neglected reproductive health conditions.”
This debate focuses on the impact of endometriosis on women in the workplace. I chose this specific focus of attention because an examination of all the issues facing women with this condition would far exceed the time constraints of an Adjournment debate; it would span an entire Parliament and more.
Jim Shannon (Strangford) (DUP)
I commend the hon. Lady for raising this massive issue. I have in my office a girl who joined as a 16-year-old and has been with me for almost 12 years. She got married on new year’s day. At the age of 28, she had menopause to try to help her endometriosis. As a caring employer, I obviously made sure that she had all the days off that she needed, but not every workplace will ensure that such women get the time off that they should. Does the hon. Lady agree that, although the debate will raise awareness, there is a role for the Government to ensure that there is training for businesses so that they understand their obligations?
Gill Furniss
I thank the hon. Member for that point.
The issue has been known about for a long time. The women’s health strategy, published in 2022, painted a picture of what workplaces should be like over the next 10 years, arguing that women should
“feel able to speak openly about their health and to be confident that they will be supported by their employer and workplace colleagues, with an end to taboos”
and that
“women experiencing women’s health issues such as period problems, endometriosis, fertility treatment, miscarriage and menopause”
must
“feel well supported in their workplaces.”
This is a far cry from the reality facing women in the workplace today.
Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)
It is fortuitous that you are in the Chair tonight, Madam Deputy Speaker, given all the work you did on these issues in the last Parliament as Chair of the Women and Equalities Committee.
I think that the hon. Lady attended my Westminster Hall last year, and I am grateful to her for securing this Adjournment debate. As a direct consequence of my Westminster Hall debate, Essex police contacted me, saying, “We are looking into doing this. Can you give us advice on the workplace?” It was a great example of the impact of this place, and employers will be listening to her debate. Des she agree that education and sunlight will help a lot of employers make the right decisions?
Gill Furniss
I thank the right hon. Member for that intervention, and I absolutely agree. I pay tribute to you, Madam Deputy Speaker, and to the right hon. Member for the efforts he has put in over many years.
Stigma and a lack of awareness by employers means that reproductive health conditions can have a significant effect on women’s experiences at work. It is almost impossible to remain at work when suffering from chronic pain and the mental toll that these conditions cause.
Bell Ribeiro-Addy (Clapham and Brixton Hill) (Lab)
I thank my hon. Friend for the fantastic speech she is making. Endometriosis UK, which provides the secretariat of the all-party parliamentary group on endometriosis, of which I am the chair, released a report last year that found that 47% of women had visited their GP 10 or more times with symptoms prior to diagnosis. Many of those women are likely to face issues with getting time off work to attend these appointments, or experience some form of disciplinary action because of it. Does my hon. Friend agree that being understanding and tolerant about the number of appointments needed to secure a diagnosis is critical to being an endometriosis-friendly employer, and that, ultimately, we need to take steps to ensure that the process does not take several years and so many appointments?
Gill Furniss
I thank my hon. Friend. The average length of time taken is now eight years, which is not good.
Many women feel unable to speak openly about endometriosis as they would other conditions, as if it were something to be ashamed of. Research shows that 23% of women take time off work because of period health issues while 80% lie about reasons for absence if they are related to periods. Having said that, endometriosis is not just about periods; it is a whole-body complaint. I do not think there is an organ in the body up to the chest that has not been found to be affected by what is a crippling disease.
Sir Alec Shelbrooke
I want to build on what the hon. Lady said about endometriosis in the workplace. The condition often comes with infection of the digestive system, which can make many women incontinent to the point that they suddenly have to run. That is important to consider, as this is not just about appointments and time off but the conditions in which people work and the understanding they need from their colleagues and bosses.
Gill Furniss
I completely agree, and it has serious consequences. Women may need to have a stoma because of the damage done to their bowels. The right hon. Member and I have both met quite young women their 20s who have needed to have hysterectomies and will never be able to bear a child.
Endometriosis should not mean that women have to put their careers on hold and leave the jobs they have worked hard to get. Employers can take simple steps such as offering flexible working, access to period products and time off to attend appointments to build the type of workplace envisioned in the women’s health strategy.
I am pleased that the Government have brought forward the Employment Rights Bill, which will be the biggest boost to workers’ rights in a generation. That offers the perfect opportunity to begin to change the workplace experience of women with endometriosis.
Alice Macdonald (Norwich North) (Lab/Co-op)
I thank my hon. Friend for securing this important debate. As she mentioned, endometriosis can have a knock-on effect on many areas of a woman’s life. It can affect mental health, and it can also have an impact on fertility, yet there is no statutory right to time off work for fertility treatment, or indeed in many other scenarios. Does she agree that we should welcome the support that employers provide in this area and encourage others to do much more to support women going through endometriosis and so many other difficult conditions?
Gill Furniss
I thank my hon. Friend for that point, and I completely agree.
Although the Employment Rights Bill does require large employers to publish equality action plans, there is no specific mention of reproductive conditions. What discussions is the Minister having with her colleagues in the Department for Business and Trade to ensure that those issues are not forgotten?
What hope can we have that employers will understand the condition if even some medical professionals do not? All too often, we have heard stories from women who have been told, “It’s just a heavy period” and, “Suck it up—every woman goes through this.”
Catherine Atkinson (Derby North) (Lab)
I met women from the endometriosis support group in Derby, and so many reported that they had had to give up work because of their symptoms as well as the huge delays in their diagnosis and treatment. Does my hon. Friend agree that until this gets real priority and understanding, we will continue to lose out on the talents and skills of women with endometriosis?
Gill Furniss
Absolutely, and I will come to that shortly.
That leaves women feeling dismissed, ignored and belittled by the very people who should be helping them. The result is that it takes almost nine years on average to get a diagnosis of endometriosis in the UK. I therefore look forward to hearing from the Minister on the steps she is taking to promote better awareness.
Kirsteen Sullivan (Bathgate and Linlithgow) (Lab/Co-op)
Will my hon. Friend give way?
Gill Furniss
I am sorry; I have got to make progress.
I do not underestimate the task for Ministers in fixing our NHS after it was left in tatters by the previous Government. Waiting lists for gynaecological care have grown faster than those for any other specialty in recent years, leaving many women in agony. The women’s health strategy correctly identified some of these chronic issues, but in the absence of funding to back that up, we have gone further and further backwards from what we need.
For instance, women’s health hubs have improved women’s access to healthcare services, but the previous Government failed to give them long-term certainty and their funding is set to run out in March. As the Government work hard to rebuild the NHS, improving gynaecological care must be at the centre of that, because women have waited long enough. Will the Minister therefore update the House on how the Government will implement the measures in the women’s health strategy?
We must continue to encourage research into endometriosis. Our world-leading researchers are doing vital work in clinical trials to find better ways to manage and treat this condition. They will not stop until they find a cure. Therefore, will the Minister outline what steps she is taking to support clinical research and ensure that women are able to get on to those clinical trials? If we have a cure, it is obvious that we will not have any of the problems that I have spoken about.
I commend the Women and Equalities Committee on its excellent report into women’s reproductive health conditions. It has made a number of recommendations, including on employment rights, and I look forward to reading the Government’s response. I hope that they will listen to calls to give specific mention to reproductive health as part of the Employment Rights Bill, which has cross-party support. I also praise Endometriosis UK for its invaluable work in supporting women with this condition and campaigning for change. It acts as the secretariat for the all-party parliamentary group on endometriosis, of which I am an officer.
Kirsteen Sullivan
I thank my hon. Friend for securing this critical debate. With an average of eight-plus years for a diagnosis, does she agree that employers must build a more supportive and flexible approach that embeds policies to help women, such the endo-friendly employers scheme? Will she join me in thanking campaigners such as the Endo Warriors West Lothian for their tireless awareness-raising efforts?
Gill Furniss
My hon. Friend is absolutely right—that is what we are talking about. For many years, the APPG was chaired by our dear friend David Amess. David campaigned tirelessly for improvements to endometriosis care, and he will forever remain on our minds as we continue his legacy.
The Minister for Secondary Care (Karin Smyth)
I congratulate my hon. Friend the Member for Sheffield Brightside and Hillsborough (Gill Furniss) on securing this important debate on the impact of endometriosis on women in the workplace. In opposition I supported the work of the APPG. I echo the praise for the campaigning work of Endometriosis UK and the support that you, Madam Deputy Speaker, and others in the Chamber have given to the APPG. I also remember the work of our friend David Amess. I echo the recognition of the recent report by the Women and Equalities Committee on reproductive health conditions. My Department is working across Government on our response, which will be published in due course.
I welcome the progress made on raising awareness—we are moving very fast on this—and on providing better support for women’s health conditions, including endometriosis. Nevertheless, this Government recognise that women with endometriosis have been failed for far too long, and we acknowledge the impact that it has on women’s lives, relationships and participation in education and the workforce. There is still much more work to be done. We are committed to improving support for any women and girls whose periods or women’s conditions disrupt their normal life, work or education.
In addition to receiving support in the workplace, all women should have access to healthcare support to help diagnose and manage this condition. We are making progress to ensure that those with endometriosis receive a timely diagnosis and effective treatment.
Sir Alec Shelbrooke
There has been a lot of cross-party work on this issue. I led a debate—the last one before the general election was called, I think—on endometriosis education. It is not prescribed that schools should educate about what a bad period is—I still meet women born in this century who do not know. If someone does not know what a disease is, how do they know that they have it? I urge the Minister to ensure that those messages are pushed in the Department for Education, as we need to ensure that people know what diseases they could have.
Karin Smyth
I thank the right hon. Gentleman for that point, which I will talk about later.
On the Employment Rights Bill, our plan to make work pay sets out a significant and ambitious agenda to ensure that workplace rights are fit for a modern economy, empowering working people and contributing to economic growth. On 10 October, the Government fulfilled their manifesto commitment to introduce legislation within 100 days of entering office, by introducing the Employment Rights Bill. As part of the Bill, we are taking the first steps towards requiring employers to publish action plans alongside their gender pay gap figures. The relevant clause sets out that regulations may require employers to develop and publish action plans relating to gender equality, which include measures to address the gender pay gap and support employees going through the menopause. It deliberately does not provide an exhaustive list of matters related to gender equality, giving us the scope to be led by the actions themselves. This reflects the fact that many of the actions employers take will be beneficial for people in a lot of different circumstances; for example, improved provision of flexible working can be valuable for an employee balancing childcare as well as someone managing a health condition such as endometriosis.
In the same way, ensuring that employers support staff going through the menopause will necessitate them taking steps that are positive for supporting women’s health in the workplace more broadly. For example, menopause best practice includes greater discussion around women’s health and awareness of potential workplace adjustments—things that have a much wider potential benefit. As my hon. Friend said, we need to start to reduce the stigma and taboos and remove them from the debate.
Through the Employment Rights Bill, the Government are also making statutory sick pay payable from the first day of sickness absence. This will particularly benefit those who suffer from conditions such as endometriosis, who may need to take time off to manage a flare up. We are also removing the lower earnings limit and extending statutory sick pay to up to 1.3 million additional low-paid employees, particularly benefiting women, young people and those in part-time work.
The Minister for Equalities, my hon. Friend the Member for Llanelli (Dame Nia Griffith), leads for the Government on the Bill from the equalities team, and I can assure my hon. Friend the Member for Sheffield Brightside and Hillsborough that we are working with her and talking about this issue throughout the Government. For example, I regularly join Women and Equalities questions here in the Chamber to make sure we work closely together, and I will continue to work closely with colleagues on these issues.
The new measures we are seeking to introduce build on existing Government support for employers, which recognises their key role in increasing employment opportunities and supporting disabled people and those with health conditions to thrive as part of the workforce. The Government’s current offer to employers includes a digital information service that provides tailored guidance to businesses to support employees to remain in work. That includes guidance on health disclosures and having conversations about health, as well as guidance on legal obligations including statutory sick pay and reasonable adjustments. The service is available across Britain and can currently be accessed from a range of trusted locations, including both the Health and Safety Executive and ACAS websites. We are also taking steps to better understand the challenges faced by women with endometriosis in the workplace and to improve workplace support for those with the condition.
The Government health and wellbeing fund has awarded almost £2 million to 16 voluntary, community and social enterprise organisations leading projects focused on supporting women who experience reproductive health issues to remain in or return to the workplace, including a project on endometriosis delivered by Endometriosis UK.
An Office for National Statistics study is investigating the impact of endometriosis on women’s labour market outcomes. This important study will be a vital step to improving our understanding and will inform future actions policy work. The first publication in this research project, on the characteristics of women diagnosed with endometriosis in England between 2011 and 2021, was published in December.
In addition to providing workplace support for endometriosis, the Government are committed to improving healthcare support and ensuring that women with endometriosis can receive timely diagnosis and treatment. We recognise that patients have been let down for too long while they wait for the care they need. Nearly 600,000 women are on gynaecology waiting lists. It is unacceptable that patients are waiting too long to get the care they need. I thank my hon. Friend the Member for Sheffield Brightside and Hillsborough for her sympathy with the task of reducing those lists, but that is our priority. Cutting waiting lists, including for gynaecology, is a key part of our health mission and a top priority for this Government. We have committed to achieving the NHS constitutional standard that 92% of patients should wait no longer than 18 weeks from referral to treatment by the end of this Parliament, and that absolutely includes those waiting for gynaecology treatment.
My noble Friend Baroness Merron, the Minister responsible for patient safety, women’s health and mental health, and I recently met with the Government’s women’s health ambassador, Professor Dame Lesley Regan, and NHS England to discuss progress on women’s health and current issues including gynaecology waiting lists. Following that meeting I am pleased that our recently published plan for reforming elective care sets out commitments to support the delivery of innovative models in gynaecology offering patients care closer to home and piloting gynaecology pathways in community diagnostic centres for patients with post-menopausal bleeding.
Enabling access to adequate healthcare support begins with providing high-quality education and information on menstrual health, as the right hon. Member for Wetherby and Easingwold (Sir Alec Shelbrooke) highlighted, so that women and girls know when and how to seek help for symptoms such as heavy or painful periods. The compulsory aspects of the curriculum on relationships, sex and health education means all pupils are taught about several areas of women’s health, including menstruation, contraception, fertility, pregnancy and menopause.
My right hon. Friend the Secretary of State for Education has committed to providing teachers with clear guidance that focuses on the wellbeing of children. Her Department will look carefully at all relevant evidence and engage with stakeholders, including young people and parents, ahead of publishing a consultation response and the revised guidance later this year. I am pleased that Dame Lesley Regan, in her role as women’s health ambassador, has been feeding women’s health perspectives into this work.
My Department has worked with NHS England to improve and create new content on endometriosis symptoms, diagnosis and treatment options on the NHS website and YouTube channel. NHS England has also published a decision support tool for managing heavy periods to support women’s understanding of their symptoms and appropriate treatment options to discuss with clinicians. Education and clinical guidelines support healthcare professionals to provide care for women with endometriosis.
The General Medical Council has introduced the medical licensing assessment for most incoming doctors, including all medical students graduating in the academic year 2024-25 and onwards. The content for the assessment includes several topics relating to women’s health, including menstrual problems and endometriosis, and will encourage a better understanding of common women’s health problems in all doctors as they start their careers in the UK, which we all want to see. Endometriosis is also already in the core curriculum for trainee GPs, obstetricians and gynaecologists.
Last year, the National Institute for Health and Care Excellence published updated guidelines on the diagnosis and treatment of endometriosis, and the new and updated recommendations on referral and investigation should help women receive a diagnosis more quickly. Through the National Institute for Health and Care Research, the Department has also commissioned a number of studies focused on endometriosis diagnosis and treatment and patient experience.
In closing, I thank my hon. Friend the Member for Sheffield Brightside and Hillsborough for tabling this debate and for her continued long-standing advocacy for women’s health. Let me affirm the Government’s commitment to supporting the many women who live with endometriosis in the workplace and beyond. This Government are committed to prioritising women’s health as we build an NHS fit for the future. My noble friend Baroness Merron is carefully considering how we take forward the women’s health strategy by aligning it to the Government’s missions and forthcoming 10-year health plan, and women’s equality will be at the heart of our missions. It is vital that we work with women to better understand their experiences and address their concerns, which have been ignored for far too long.
Question put and agreed to.
7.27 pm
House adjourned.
Deferred Divisions
(3 days, 7 hours ago)
Commons ChamberRead Full debate Read Hansard Text
That the draft Electricity Capacity Mechanism (Amendment) Regulations 2024, which were laid before this House on 18 November 2024, be approved.
The House divided: - Ayes: 418 / Noes: 78 - Question accordingly agreed to.
That the draft Official Controls (Amendment) Regulations 2024, which were laid before this House on 19 November 2024, be approved.
The House divided: - Ayes: 423 / Noes: 77 - Question accordingly agreed to.
That the draft Clean Heat Market Mechanism Regulations 2024, which were laid before this House on 21 November 2024, be approved.
The House divided: - Ayes: 424 / Noes: 109 - Question accordingly agreed to.
Draft Reporting on Payment Practices and Performance (Amendment) (No. 2) Regulations 2024
(3 days, 7 hours ago)
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The Parliamentary Under-Secretary of State for Business and Trade (Gareth Thomas)
I beg to move,
That the Committee has considered the draft Reporting on Payment Practices and Performance (Amendment) (No. 2) Regulations 2024.
It is a pleasure to serve under your chairmanship, Ms McVey.
The regulations were laid in draft before the House on 7 October 2024. By way of introduction, let me explain that the regulations seek to amend the Reporting on Payment Practices and Performance Regulations 2017 and the Limited Liability Partnerships (Reporting on Payment Practices and Performance) Regulations 2017. Let me give a bit of context to the issue. Prompt and fair payment has long been an issue in the construction sector and particularly affects small businesses in the supply chain. Holding what is known as retention money is a long established construction contractual practice intended to provide security against defective work or the insolvency of the subcontractor supplier. However, it can operate unfairly against smaller suppliers who can feel unable to question or to challenge how the practice is applied.
A retention clause allows the employer to deduct and retain a proportion of the value of the contract otherwise owed to the supplier until particular contractual conditions are met. Typically, 3% to 5% is held over the duration of the project and for a period post completion. The use of retention clauses in construction contracts can be particularly problematic to the supply chain due to late, partial or non-payment of retentions, or these being permanently lost through upstream insolvencies.
There has been an attempt to deal with this issue. Not everything the previous Government did was entirely wrong. This is one of those rare exceptions where the Government recognised that there was a problem in this space and were intending to introduce this regulation until the general election was called. Recognising the good intent behind this particular proposal, we have sought to lay it before the House again, and this is the result. What is not in the existing regulations, as they stand at the moment, is the requirement for specific reporting relating to retentions that are held under construction contracts, and this SI seeks to put that right. It will bring greater transparency in relation to the retention policies, practices, and performance of larger businesses that have construction contracts.
In the first instance, reporting will require a statement on whether the company's payment practices and policies include or do not include retention clause. Where a company makes a statement that retention clauses are included in its construction contracts, further information must be submitted. Details will be required on whether retention clauses are included in all its construction contracts, whether the company’s standard payment terms include retention clauses, or whether retention clauses are used only in specific circumstances, which it would need to describe. Details would also be required on whether there is a contract value under which no retention clause is included, and that value, whether there is a standard rate of retention applied and that rate, whether there is a practice of using retention clauses that is no more onerous than those that businesses upstream are subject to, and whether there is a description on the process for the release of the retentions that are held.
Two specific metrics will also be required: the percentage ratio of the amount of retention that is withheld from the company by its clients, which the company holds back from its suppliers, and the percentage ratio of the amount of retention that the company withheld from the total value of payments made to suppliers as a proportion of the amount paid to suppliers during the reporting period. Those metrics will help to provide smaller firms with better information about a large business’s retention payment practices, and by doing so, incentivise large businesses to improve those practices.
In conclusion, this is a measure that will provide small firms in the construction supply chain with information that will enable them to take decisions about entering into contracts and to understand how to ensure that retentions owed to them are paid. It will also create a clear incentive for firms to improve their payment performance in relation in relation to retentions. The Government are looking at the whole practice of late payment in in general terms. We have announced our intention to consult more broadly on what further measures we can bring in to tackle the problems around late payment, but this SI stands alone as a useful measure, and I commend it to the Committee.
Dame Harriett Baldwin (West Worcestershire) (Con)
It is a very great pleasure to serve under your chairmanship this morning, Ms McVey. I just note that the Minister highlighted the fact that, in fact, this initiative had been started under the previous Government, and so you would not expect me to be objecting to its passage today. But I do have, in the interest of scrutiny, a few questions for the Minister.
The explanatory memorandum accompanying the statutory instrument highlights the improvements that have occurred in the time that it takes to pay invoices since these measures were brought in in 2018. There was strong support in the consultation for extending the reporting requirements to these retention payments. Could the Minister summarise for the record what the objections were in the consultation and from whom they came—the people who did not support moving forward with these measures?
The Department will generally, it says in the explanatory memorandum, seek to encourage businesses to comply with the regulation by encouraging them, getting in touch with them rather than prosecuting them for non-compliance. Could the Minister highlight if there have actually been any prosecutions at all under the previous payment regulations, and, if so, who the holdouts or the big contractors that have resisted these measures have been?
Most companies say that this regulation will be an ongoing cost to their business. It is estimated to be a small amount of £10 million per year. Can the Minister outline for the committee any measures that he is planning that will reduce costs for businesses? Businesses are telling me that the extra cost of national insurance and the Employment Rights Bill are adding costs to their businesses that can be seen from space. The last Government introduced new requirements for firms bidding for large Government contracts to make sure that they pay small businesses on time, and those bidding for Government contracts over £5 million will have to demonstrate that they pay their own invoices within an average of 55 days, tightening to 45 days and then to 30 days in the coming years. Can the Minister confirm that he is planning to continue with that approach?
The last Government overhauled the voluntary prompt payment code, halving the time signatories have to pay small businesses to 30 days. Is the Minister planning to update us on the progress he has made on this matter in the last six months, and has the number of signatories gone up or down—it was 2,800 voluntary signatories. I look forward to the Minister’s answers and we support the measures today.
Daisy Cooper (St Albans) (LD)
In so many sectors, we have this enormous power imbalance between large companies and the smaller companies that they often contract through their supply chains, and construction is no exception. The Liberal Democrats have no objection to this and broadly welcome it. Anything that increases transparency is a good thing. Anything that tries to redress the power imbalance in those supply chains is also incredibly welcome.
I have just two questions for the Minister. As a liberal, I strongly believe in the power of incentives, and we always hope that incentives work. In many cases they do. My first question to the Minister is that if these incentives show that they do not work, will the Government have some system for monitoring that process? Is there some point at which, in the future, the Government intend to review the effectiveness of this legislation? Secondly, the Minister mentioned that more broadly the Government are looking at the issue of late payments: is he at liberty to mention, either now or at a later stage, the scope of that particular review and which sectors that might apply to?
Gareth Thomas
I am grateful to the hon. Members for West Worcestershire and for St Albans for their questions. On the question of the prosecution of firms, as I think I alluded to in my opening remarks, regulations on reporting did come into force back in 2017. To be blunt and to be candid in this forum, there has not been much enforcement of those regulations. We are seeking to put that right, and have written to over 500 firms who have not been complying with those regulations. There has not been a prosecution as yet, because we are still within the period that we want to give firms the chance to comply. If there is a refusal to comply, prosecution can take place, with potentially unlimited fines for non-compliance. Obviously, I very much hope we do not get to that to that stage, and that firms do respond appropriately to the correspondence from my officials to those firms who have not currently complied.
I cannot give the hon. Member for West Worcestershire a specific breakdown of which sector of the construction industry were opposed to this regulation. All I would say is that there was a very strong balance in the consultation responses that were presented to the last Government, as I understand it, in favour of the approach that we are taking now. On that basis, and as a result of conversations we have had since we got into government, we believe the measures are appropriate. That comes on perhaps to one of the issues that the hon. Member for St Albans raised about what happens if this does not lead to the to the outcomes that we want. Our sense is that it will work, that creating incentives has been shown to work to date. Build UK, which is a fairly representative organisation for the construction industry, has benchmarked construction businesses on their payment performance since 2018. Its work shows a significant improvement in terms of payment, and we hope a similar level of improvement will be achieved by the requirements in this SI. Under the regulations, we have the opportunity to come back if loopholes are spotted, and we will obviously keep that in mind and see how things develop.
More broadly speaking, the second question from the hon. Member for St Albans alluded to what else we are doing in the late payment space—a question that was touched on also by the hon. Member for West Worcestershire. We are getting ready to consult on a package of further legislative measures around payment practices. We are not quite ready to do it now, so I cannot tell the House that, but we will bring forward proposals shortly, and obviously the House will be informed at the appropriate time. We recognise this is a huge issue for small businesses. It has led, in many cases, to small businesses going bust and is a huge waste of time in terms of the productivity of small businesses having to chase late payments. I commend the SI to the Committee.
Question put and agreed to.
Draft Free-Range Egg Marketing Standards (Amendment) (England) Regulations 2024
(3 days, 7 hours ago)
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The Minister for Food Security and Rural Affairs (Daniel Zeichner)
I beg to move,
That the Committee has considered the draft Free-Range Egg Marketing Standards (Amendment) (England) Regulations 2024.
It is Wednesday morning, so we must be here again, Mrs Harris. It is a pleasure to serve with you in the Chair. The draft regulations were laid before the House on 21 November 2024, and will amend the existing legislation governing egg marketing standards to enable free-range eggs to be marketed as such for the duration of mandatory housing measures that restrict laying hens’ access to open-air runs.
Currently, when free-range hens are placed under mandatory housing measures due to disease outbreaks such as avian influenza, the existing egg marketing regulations allow their eggs to continue to be labelled as free-range for only 16 weeks. This is known as the 16-week derogation period. If the mandatory housing measure lasts for longer than 16 weeks, eggs from those hens have to be labelled and sold as barn eggs.
The requirement for egg producers and packers to re-label free-range eggs as barn eggs once the 16-week derogation period is exceeded is difficult to implement in modern automated pack houses, adding significant logistical and packing cost to the industry, so the statutory instrument will remove the 16-week derogation period so that free-range egg producers and packers can label and market the eggs as free-range for the duration of a mandatory housing measure, however long that might last.
Under mandatory housing measures, egg producers still have the higher operating costs of maintaining their free-range egg system, with the additional cost of having to ensure that hens are also temporarily housed indoors. The normal laying period of a productive free-range laying hen in the UK is around 90 weeks. The SI will remove the derogation that will affect only a small part of a laying hen’s productive life, with all the other free-range criteria, except access to open-air runs, still needing to be met.
In 2024, the Department for Environment, Food and Rural Affairs and the Scottish Government held a joint consultation on the proposed changes, and 70% of respondents supported the removal of the 16-week derogation. The removal of the derogation has already come into force in Scotland. Following their own consultation exercise, the Welsh Government have announced that they will also introduce legislation to remove the derogation.
In 2023, the European Union amended its egg marketing standards regulations to remove the 16-week derogation period. Through the Windsor framework, this also applies to free-range eggs produced in Northern Ireland. Without the SI, the introduction of any mandatory housing measures that last longer than 16 weeks—for example, during an avian influenza outbreak—would be detrimental for English free-range egg producers and result in an increase in the importing of free-range eggs from the EU and Northern Ireland. This could have a significant negative long-term impact on the English free-range egg industry. The SI will restore alignment with the EU and Northern Ireland, and will also ensure that free-range egg producers and packers do not incur additional costs for adhering to Government-imposed housing requirements.
Unfortunately, outbreaks of avian influenza usually occur during the winter months, as was the case in 2021-22 and 2022-23, resulting in the introduction of housing measures for poultry that, in both those cases, lasted longer than the 16-week labelling derogation period. They lasted for an additional six weeks in 2021-22 and seven weeks in 2022-23. It is, then, imperative that the SI is in place for the rest of the winter period and beyond.
We continue to uphold the high standards expected by UK consumers and businesses. The change in the statutory instrument will safeguard our important British egg industry. I commend the draft regulations to the Committee.
Dr Neil Hudson (Epping Forest) (Con)
It is a pleasure to serve under your chairship, Mrs Harris. I thank the Minister for bringing the draft regulations to the Committee. I am pleased to say that we, His Majesty’s most loyal Opposition, are supportive of the statutory instrument and offer no objections. The initial consultation conducted by the previous Conservative Government in January 2024 demonstrated strong support for the proposals, leading to this statutory instrument.
Current marketing standards allow hens to be housed for 16 weeks before their eggs are required to be re-labelled as barn eggs. Recent avian influenza outbreaks have once again necessitated the introduction of mandatory housing measures for free-range poultry in certain areas, which can sometimes exceed the 16-week limit. Consequently, producers adhering to these essential measures have been penalised through the loss of their free-range status.
In the previous Parliament I served on the Environment, Food and Rural Affairs Committee, and we looked into this issue extremely closely and fed our work in to the Government. I am pleased that the previous Government responded positively, and that the new Government have picked up the baton. The changes in the statutory instrument will remove the 16-week derogation period, thereby protecting producers who are doing the right thing by responsibly housing their birds under the chief veterinary officer’s instructions during the imposition of avian influenza controls. I should declare an interest: I am a veterinary surgeon so I have a strong personal and professional interest in this subject.
The changes are made in the knowledge that once the restrictions are lifted, the birds will be back out and free-range. Furthermore, they will ensure that English free-range producers maintain parity with the EU, where the 16-week time limit was removed from egg marketing standards legislation in 2023, as the Minister articulated. This will create a level playing field for our producers and reduce the likelihood of English free-range eggs being substituted with imported eggs.
Although we support the statutory instrument, I do have some questions for the Minister. Before I ask them, I put on the record my thoughts and sympathy for farmers and bird keepers who have been affected by avian influenza outbreaks. The virus is still with us and there are still outbreaks. I also pay tribute to everyone at the Animal and Plant Health Agency. Vets, officials and scientists are working hard on the situation, as they are working on many different disease situations. Avian influenza is with us, bluetongue is still bubbling away, and we now have the real concern of foot and mouth disease having been confirmed in our near neighbour Germany.
As a veterinary surgeon, I am all too aware of the devastating impacts that animal disease outbreaks can have. Avian influenza outbreaks obviously affect not only reared domestic birds but wild birds, but there are also significant human impacts, not least on the mental health of those in the frontline. Given the ongoing avian influenza situation, will the Minister outline the additional measures the Government are taking on avian influenza to preserve our nation’s biosecurity? What is the current policy and status in terms of vaccine development and deployment?
In addition, will the Minister clarify what steps are being taken to co-ordinate the changes with Welsh authorities? We know they are introducing changes, but we must make sure that we have a consistent approach across the UK. We strongly support these crucial measures and I am grateful that the regulations have been brought to the Committee today.
Daniel Zeichner
I am grateful to the hon. Gentleman for his support. We are very much carrying forward the work of the previous Government.
The hon. Gentleman asked about the additional measures to preserve biosecurity and raised the important issues in respect of bluetongue and of foot and mouth disease in Germany. I assure him that all the measures he would expect to be in place are in place. I spoke to the German Minister about foot and mouth last night, and we will update the hon. Gentleman and his colleagues if there are any further developments. We obviously hope that outbreak can be contained. On bluetongue, we held a roundtable yesterday on our approach for the future. I assure the hon. Gentleman that we are very aware of these threats. Anyone who holds the relevant offices is aware that they are of huge concern not just to the farming community but to the wider community.
The vaccination against avian influenza of poultry and captive birds, excluding those in licensed zoos, is not currently permitted, as I think the hon. Gentleman knows. Although authorised vaccines are available, they are unlikely to provide full protection for the strains of highly pathogenic avian influenza that are currently circulating in the UK and Europe. At present, while vaccination can help to reduce mortality, it is likely that some vaccinated birds would still be capable of transmitting avian influenza if they became infected. Vaccination is not, then, part of our current approach.
The hon. Gentleman asked about the situation in respect of Wales. As I said in my opening statement, the Welsh Government are pursuing similar lines on this matter.
With that, I hope we can move to a conclusion. I should add that I understand that there will be concerns that somehow consumers will not get quite what they what they seem to be getting. We are we mindful of that, so to reduce the risk of consumers feeling misled, we will encourage retailers to place signage near where eggs are displayed, to inform consumers of the imposition of mandatory housing measures and their impact on the marketing of free-range eggs—notably that, except for access to open-air runs, the rest of the free-range egg criteria continue to be met.
This statutory instrument is an important measure to support the British egg industry by making sure it has a level playing field with trading partners such as the European Union that have already adopted similar provisions. On that basis, I commend the draft regulations to the Committee.
Westminster Hall
(3 days, 7 hours ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Rivers, Lakes and Seas: Water Quality
(3 days, 7 hours ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Catherine Fookes (Monmouthshire) (Lab)
I beg to move,
That this House has considered water quality in rivers, lakes and seas.
Bore da—good morning. It is a pleasure to serve under your chairship, Mr Dowd. I grew up in the countryside on a farm, and one of my favourite memories was having a friend round, going for a walk and sploshing through the streams at the bottom of the garden. We took it for granted that we could mess about in the Dorset chalk streams, and apart from annoying my mum when I came back inside sopping wet, making a terrible mess, there was never any fear that I would get sick or that I would be wading through sewage. What a change there has been, with parents now too scared to let their children run helter-skelter into the local stream, river or lake, for fear that they will get an ear infection, an eye infection or a stomach infection, or encounter a wet wipe or something much worse.
I moved to Monmouthshire 25 years ago, and it was fantastic to raise my children there, with its fantastic rivers including the Wye, the Usk, the Monnow and lots of smaller rivers criss-crossing the constituency. I have spent so many happy hours, as I am sure other Members have in their local rivers, swimming in the Usk, walking by the Wye and kayaking down it. I have seen kingfishers and heron there and introduced my kids to the amazing wildlife we have, and I have spent some of our happiest days there as a family.
Sadly, the health of our two major rivers, the Wye and the Usk, is in serious decline, and they are really good examples of what is happening elsewhere in the UK. In February 2022, Natural Resources Wales research showed that the Usk had the highest incidence of phosphate pollution of the nine Welsh special areas of conservation, or SACs, designated for rivers. In Glascoed near Usk, there was an average 85% failure rate against phosphate targets between January 2023 and June 2024.
The Wye is being impacted by high levels of phosphates, which are causing a decline in water quality and algal blooms that then starve the fish, plants and invertebrates of oxygen. That leads to biodiversity loss and the collapse of the whole web of life in the river. These algal blooms are growing larger and becoming more frequent. In 2020, a thick algal bloom extended for more than 140 miles of the river. Recovery will take decades.
Natural England’s condition assessment for the Wye SAC in 2023 was “unfavourable-declining”, which was based on declines in Atlantic salmon, water quality and white-clawed crayfish in the Lugg, and aquatic plants, Atlantic salmon and white-clawed crayfish in the Wye.
Jesse Norman (Hereford and South Herefordshire) (Con)
I congratulate the hon. Lady on securing this debate on an immensely important topic, and I am grateful to you, Mr Dowd, for allowing a quick intervention from a shadow Front Bencher on a matter of great constituency interest. She will be aware that I and others have tried to fight this battle for at least four years. Will she support my request that the Government look again at the plan for the River Wye and, even if they do not adopt the detail of it, at least preserve the £35 million of funding pledged by the previous Government, or something close to it, to support the restoration of the river?
Catherine Fookes
I salute some of the work that the right hon. Gentleman has tried to do locally on the Wye in Herefordshire, even though he is an Opposition Member, but with all due respect, the River Wye action plan was roundly discounted and felt to be not worth the paper it was written on by the non-governmental organisations in the area at the time. The Government failed to consult Wales, and the plan seemed to be rushed out before the general election. When the Minister looked at it, she found that that money was not allocated and available to push out and support the Wye. I am sure she will say later that we have had a meeting with the Wye Catchment Partnership, and that we are working in partnership with the Welsh Government to push forward a plan that has been developed by the Wye Catchment Partnership. I will give some more detail about that in a moment.
Unfortunately, after 14 years of Conservative failure, we have record levels of illegal sewage dumping in our rivers, lakes and seas. I will talk much more about rivers today, because that is what I have in my constituency, but our lakes, seas and coastal towns are also deeply affected.
Chronic ongoing diffuse pollution from agriculture also affects our water quality. In England, only 16% of all assessed surface waters achieved good ecological status, and less than 1% achieved high status. The decline in our water health is staggering, and we desperately need to take action to repair it. As I know hon. Members will agree, there are amazing NGOs, campaigning groups and citizen scientists in every one of our constituencies who have brought this matter to our attention and to the fore nationally. I pay tribute to all of them, especially those in Monmouthshire.
Mr Gregory Campbell (East Londonderry) (DUP)
I congratulate the hon. Lady on securing this debate. She is talking about those who are contributing to the debate and trying to do their best, but does she agree that it should not be left to people such as one-time musical celebrity Feargal Sharkey, from my city of Londonderry, and many others to campaign on these issues? We need Government action rather than pressure groups and people trying to campaign for change.
Catherine Fookes
I agree with the hon. Gentleman, and I thank him for his intervention. That is exactly why the Government are taking action. I will come on to what the Labour Government are doing shortly. I was fortunate to meet Feargal Sharkey on the campaign trail. He endorsed my campaign, which means that I will be held to account. That is one of the reasons why this issue is so important to me and why I am pleased to have secured this debate.
I believe that the campaigning groups in Monmouthshire are some of the best in the UK. We have Save the River Usk, led by the inspiring Angela Jones, Friends of the River Wye, Save the Wye, the South East Wales Rivers Trust, the Wye & Usk Foundation and many more, and they continue to do excellent work to hold us to account.
We also have the Wye Catchment Partnership, which is a cross-border partnership of more than 70 members, including Natural Resources Wales and the Environment Agency and representatives of all the local authorities, the National Farmers Union and the environmental charities I have mentioned. It is a great partnership. As I have mentioned, the Minister recently had a meeting with the Wye Catchment Partnership to hear about the need for an action plan. I sincerely thank her for her engagement to get the Wye catchment plan phase 2 off the ground. That could be a brilliant pilot project, supported by Department for Environment, Food and Rural Affairs and consistent with the unfulfilled policy commitments of the previous Government’s plan for water. It shows how working with stakeholders across all counties and countries, and the regulators, could be a model for changing the face of our rivers. I hope the Government will support it.
Rivers know no boundaries. The Wye crosses four counties and two countries, so we need an integrated and coherent Wye catchment management plan that uses the best available evidence and a well-targeted programme of remedial measures to get our river cleaned up.
I said that Feargal Sharkey endorsed my election campaign, a key promise of which was to work in this place to clean up our rivers. That is why I am pleased that the Labour Government have done more on water in six months than the Tories and their coalition partners, the Lib Dems, did in 14 years. I am proud of the two main measures that the Government have already announced: the Water (Special Measures) Bill—I am proud to be a member of the Public Bill Committee—and the water commission. The Bill will enable the Government and regulators to block the payment of bonuses to water company executives, bring criminal charges against those who break the law, issue automatic and severe fines, and monitor every sewage outlet.
It is right that the Government have started work on cleaning up our water by tackling our water companies, which the Conservatives failed to do for 14 years, but the next big issue that we must tackle is the pollution in our waterways arising from diffuse agricultural sources. As the water commission’s remit is to look at how to tackle inherited systemic issues in the water sector to restore our rivers, lakes and seas to good health, I am sure the chair, the former deputy governor of the Bank of England Sir Jon Cunliffe, will include diffuse pollution from agriculture in his commission’s investigations.
Ms Polly Billington (East Thanet) (Lab)
I am keen to make sure that the water commission can tackle some of the most egregious failures of the water industry. For example, yesterday Southern Water dumped sewage into the sea alongside Ramsgate. This issue is fundamental to the environment and the economy in a seaside community such as Thanet, and it needs to be part of our overall drive for growth. The new independent water commission needs to explore different governance models and introduce local accountability, or the water companies will continue to fail as they have done up until now.
Catherine Fookes
I agree entirely. The Government’s mission is growth. We need to see the cleaning-up of our waterways as an integral part of our growth mission.
We know that tackling diffuse pollution from agriculture will be a hard nut to crack, with farmers already under pressure, but we have examples of good practice in the Wye. For example, Avara is already shipping out 75% of the chicken waste from its Herefordshire chicken farms along the Wye. That is to be welcomed, but it does not solve the long-term problems of too much phosphate in our rivers.
Sarah Dyke (Glastonbury and Somerton) (LD)
I thank the hon. Member for securing this important debate. I represent Glastonbury and Somerton, and a large part of the Somerset levels and moors is in my constituency. Somerset is always at the forefront of flooding, and many of my farmers are always battling flooding. Grants such as the slurry infrastructure grant helped my livestock farmers ensure that nutrients such as phosphates do not enter the watercourses. That improves the viability of our farms, the health of our soil and the cleanliness of our rivers. Does the hon. Member agree that it was wrong for DEFRA to pause access to those grants?
Peter Dowd (in the Chair)
Order. Lots of Members wish to speak today, so we could end up with a two-minute limit on speeches. I ask Members to keep their interventions very short, otherwise the limit will go down to one and a half minutes and then down to one minute.
Catherine Fookes
Thank you, Mr Dowd. To continue with diffuse pollution, Lancaster University estimates that around 83% of phosphates in the Wye come from diffuse agricultural sources, and only 15% or so from Dŵr Cymru—Welsh Water—assets. Indeed, Dŵr Cymru’s £80 million investment in AMP 7—an AMP is an asset management period, or the investment round that is done in five-year cycles—and the planned £150 million investment in AMP 8 will eliminate 100% of its fair share of phosphates in the Wye catchment by 2032. By 2030, over 90% of the phosphate load will be from diffuse agricultural sources. It is not sewage that is our main problem here.
I know this will be a hard conversation with farmers, but we need to start having it. We need to incentivise the right fertiliser applications and the right stocking rates in our river catchments on both sides of the border in order to ensure we remove the annual accrual and legacy surplus of excess phosphates and restore our rivers back to full health. Business as usual will not work.
Also, we need better enforcement of existing regulations by both the Environment Agency and Natural Resources Wales. The RePhoKUs project—the role of phosphorus in the resilience and sustainability of the UK food system—at Lancaster University, which re-focuses phosphorus use in the UK food system, estimates that phosphorus leakage from land to water also causes widespread and costly pollution worth £39.5 billion to the UK economy—a huge external cost that we must try to avoid.
In summary, we have been left a very difficult legacy due to inaction by the Tories. It will take much work by the Government to clear up the mess and the water quality in our rivers, lakes and seas to fix this broken system. I am confident that, by working cross-border and in partnership with all those involved, as the current Government are doing, we can clean up our water once and for all, as the Wye catchment partnership aims to do.
Several hon. Members rose—
Peter Dowd (in the Chair)
Order. I remind hon. Members that they should bob if they wish to be called in the debate—although you can sit down for the minute. As I said earlier, because of the number of Members who have indicated that they wish to speak, I am imposing a two-and-a-half minute time limit on Back-Bench speeches, with the authority of the Chairman of Ways and Means, to take effect right away. Bear that in mind with interventions, as I am sure you all appreciate.
Robin Swann (South Antrim) (UUP)
It is a pleasure to serve under your chairmanship, Mr Dowd.
I want to bring attention to Lough Neagh in the middle of Northern Ireland, which is the largest freshwater lake in the British Isles, spanning approximately 149 square miles. It serves as a vital resource, supplying 40% of Northern Ireland’s drinking water, but in the last two summers of ’23 and ’24 Lough Neagh has experienced severe cyanobacteria blooms, which have been visible from space. Those blooms pose a risk to wildlife and human health, due to the toxins they produce.
The Department of Agriculture, Environment and Rural Affairs in Northern Ireland has instigated 20 key measures, but we must wait for the summer to see whether they will be enough. They include enhancing monitoring and research, and other agricultural interventions. As the hon. Member for Monmouthshire (Catherine Fookes) said in respect of past processes, to tackle the challenges that agriculture faces with water quality, we need to work in partnership with farmers, and look to go back to allowing farmers to farm by the seasonal calendar, rather than a paper one that has seen farming practices put out of kilter with the seasons we now see.
The Northern Ireland water-quality framework is different from other parts of the UK. Northern Ireland is guided by national and European directives, including the water framework directive, which aims for all water bodies to achieve good ecological status, whatever the standards or the regulations. A 2024 report by the Northern Ireland Audit Office noted that the existing regulatory and policy frameworks have failed to adequately protect water quality in Lough Neagh.
Northern Ireland Water, the sole provider of water and sewerage services in the region, operates under the governance of the Department for Infrastructure and our Utility Regulator. That is why I asked, in a debate in the Chamber, that Northern Ireland Water be brought under the Government’s independent commission, which is being led by Sir Jon Cunliffe. I have been informed by the Government that that is currently restricted to England and Wales, but I think there would be a benefit if Northern Ireland was included.
Peter Swallow (Bracknell) (Lab)
It is an honour to serve under your chairmanship, Mr Dowd. I thank my hon. Friend the Member for Monmouthshire (Catherine Fookes) for bringing forward this important debate.
In December, the Environment Agency rehomed thousands of fish into the River Cut at Jock’s Lane in Bracknell. That stocking will provide an immediate boost to fish numbers, which will be multiplied many times when the arrivals settle into their new homes and begin to spawn. In recent years, Jock’s Lane has been better known as a sewage spot than an angler’s paradise, so this intervention is welcome. The question now is how best to protect these latest Bracknell residents from any further sewage leakage.
In 2023, Thames Water dumped more than 1,000 hours of raw and partially treated sewage into Bracknell and Sandhurst rivers. In Bracknell that was into the River Cut and in Sandhurst it was into the River Blackwater. It is not only deeply damaging to nature; it is frankly disgusting. A decade of under-investment by water companies and a lack of oversight from successive Tory Governments have led us to this.
Jess Brown-Fuller (Chichester) (LD)
In 2023, Chichester suffered 990 sewage spills in our rivers and harbour, lasting more than 17,000 hours. Does the hon. Member agree that, after a decade of Tory inaction, the Water (Special Measures) Bill is welcome, but it could go further on regulation, especially by giving Ofwat teeth?
Peter Swallow
I will come to just that point shortly.
The rain we saw earlier this month is another reminder of the problems we are facing. It led to another bout of sewage dumping in my constituency, including from the recently upgraded Ascot sewage works, which I visited back in December. Since 2020, executives of the water companies overseeing these incidents have been paid £41 million in bonuses and benefits, and it is reported that over the last two years water companies have paid out more than £2.5 billion in dividends. Meanwhile, the current maximum fixed penalty notice—the monetary penalty—that regulators can impose on water companies for the majority of water sector offences is £300. It is little surprise, then, that a recent survey by Ofwat showed that only a quarter of customers see companies as acting in the interests of the people and the environment.
During the general election, I campaigned on the promise that Labour would get tough on water companies and cut down on the horrific pollution they are causing. I promised that a Labour Government would put failing water companies under special measures, blocking bonuses for executives who pollute our waterways, bringing criminal charges against persistent lawbreakers, enabling automatic and severe fines for wrongdoing, and ensuring the monitoring of every sewage outlet. For that reason, I am delighted the Government have brought forward their Water (Special Measures) Bill, and I am proud to have supported it on Second Reading.
I used to be a teacher, so I know what marking your own homework looks like. The requirement for water companies to publish information on discharges from emergency overflows in near-real time will create unprecedented levels of transparency, giving regulators and the public regular insight into the around-the-clock operations of water companies. Meanwhile, making it a statutory requirement for water companies in England to publish annual pollution incident reduction plans will force water companies to set out clear, transparent actions. I would welcome clarity from the Minister on whether that monitoring will be truly independent. How much of a role will Ofwat or other relevant bodies have in producing, monitoring and assurance-testing the production of the data?
Cameron Thomas (Tewkesbury) (LD)
It is an honour to serve under your chairship, Mr Dowd.
Tewskesbury is characterised by its waterways, and most commonly known for its propensity to flood. It floods because, from north to south, the western boundary is the River Severn, and the River Avon also flows into Tewkesbury town. Tributary waterways course across the constituency. I will return to flooding shortly.
According to The Guardian, among other sources, the River Avon is one of the worst-polluted rivers in England. There were 6,573 sewage spills in 2023, registering the River Avon as the third most-polluted river in England. In the same year, sewage was released into the River Severn for more than 30,000 hours across 3,057 spills, registering the Severn as another of the worst-polluted in England and Wales.
Since the general election, I have been working with Tewkesbury Friends of the Earth and Safe Avon, two dedicated groups of local environmental campaigners. In November 2024, I joined both groups at the Abbey mill in Tewkesbury to draw water samples from the River Avon. The samples we recovered tested consistently with the findings they have been recording since June 2023: they contained very high nitrate pollution and high phosphate pollution. Such levels of those pollutants stimulate algae growth, which absorbs the oxygen in the water and suffocates wildlife.
The pollution levels are also dangerous to people. Please take a moment to consider what it is like for thousands of my residents whose kitchens, dining rooms and living rooms are swamped with this filth on an annual basis. Severn Trent Water’s chief executive officer was paid £3.2 million last year, while my residents’ water bills are due to rise by 40%. To add insult to injury, the Environment Agency awarded Severn Trent its highest grade for environmental performance. That, in and of itself, is a scandal.
The Liberal Democrats want to stop overseas shareholders drawing money out of private water companies that are already struggling to stay solvent. Rather than nationalise these companies, we want to see them turned into public benefit companies. I call on the Government to prevent CEOs from drawing huge bonuses while this scandal continues, and to fine them according to the mass of sewage discharged.
Ms Julie Minns (Carlisle) (Lab)
It is a pleasure to serve under your chairmanship, Mr Dowd.
Hidden River Cabins is a wonderful local business in my constituency that offers secluded wooden cabins, tucked away in the beautiful Cumbrian countryside to the north of Carlisle. It is, quite frankly, a breathtaking place. As well as providing the perfect spot to unwind and relax, it has become hugely popular as a wedding venue. Part of its charm is the River Lyne, which runs nearby. I suspect that many newlyweds have taken a late-night dip in its lovely waters; I myself have swum near the cabins and can testify to the river’s restorative effect.
Fortunately for locals and visitors, that stretch of the Lyne is one of the few places in my constituency where it is relatively safe to swim. That is not the case elsewhere in Carlisle and north Cumbria. In total, some 40 sites across my constituency were polluted in 2023, and it is fair to say that few people would look to start a cosy cabin business beside a sewage spot. That draws attention to another of the pernicious problems caused by pollution that the last Government allowed to flow unchecked under their watch.
Sewage, of course, poses health risks to users of our waterways, and to the wildlife and plant life that relies on those waterways, but, as my hon. Friend the Member for East Thanet (Ms Billington) mentioned, there is also an economic cost. When our rivers are clean, people will want to visit them and spend time there, and entrepreneurs will want to start businesses, creating jobs and boosting local economies. We are blessed with many beautiful rivers, lakes and seas in this country. Each of them could be lined with flourishing businesses; instead, they are off limits, their utility reduced to just how much sewage they can accommodate.
Thankfully, our Government are getting on with tackling the issue. The Water (Special Measures) Bill, which the Minister is currently piloting with such passion and grace, will give us increased powers to hold rogue actors to account. I am grateful to my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing the debate; I share her hope that our rivers will soon be places where everyone can enjoy themselves.
David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)
It is a pleasure to serve under your chairship, Mr Dowd. I thank the hon. Member for Monmouthshire (Catherine Fookes) for securing the debate. Like her, I am privileged to represent a constituency that is home to some of the UK’s most powerful rivers, including the Rivers Wye, Usk and Towy. However, these national treasures are drowning under a barrage of pollution.
The Wye, Usk and Towy are heavily polluted, harming the environment and local wildlife, and jeopardising industries such as tourism, leisure and angling. I fully support the concerns raised about the previous Conservative Government’s failure to tackle water pollution. Conservative neglect allowed water companies to pollute rivers with impunity while siphoning off profits to pay excessive bonuses and dividends. People want swift action now.
As the hon. Member for Monmouthshire mentioned, the previous Government had several roundtables on how to clean up the Wye, but what happened? Very little. The impact of the inability to clean up our rivers is hurting local communities in my constituency. We know there is a housing crisis, caused by a shortage of affordable homes. In Talgarth, a moratorium on new homes has been in place since 2022, meaning several much-needed housing schemes are frozen. Oversight from the Welsh Labour Government has fallen short.
Although it is a non-profit organisation, for years Dŵr Cymru failed to invest in infrastructure and still diverted funds into executive pay, and it is one of the worst offenders on sewage dumping. There is widespread agreement that stronger regulations on water pollution are needed, a stance that I support fully, but regulations are effective only if they are enforced. In Wales, enforcement is severely lacking. Natural Resources Wales, our environmental regulator, has faced a decade of cuts under the Welsh Government, and is currently operating at least 50 staff members short of the number needed to do the job effectively.
Andrew Cooper (Mid Cheshire) (Lab)
It is a pleasure to serve under your chairmanship, Mr Dowd. I congratulate my hon. Friend the Member for Monmouthshire (Catherine Fookes) on securing and ably leading this important debate.
The health of our seas and waterways is a pressing issue that affects each of us, and we have a collective responsibility to tackle this issue. Waterways are incredibly important to the soul of Mid Cheshire. My constituency is intersected and surrounded by waterways, including four rivers, three canals and a smorgasbord of meres and flashes—a legacy of our history of salt extraction. Indeed, Northwich played a particularly important role in the development of the inland waterways in Britain. At one time, Lawrence of Arabia was based there to oversee the spy ships that we built. Of course, Mid Cheshire’s waterways are not as important as they once were for powering our industry, but they remain vital ecosystems that support a rich tapestry of life, contribute to our economy and provide us with recreation and essential resources.
A consistent theme of this debate has been the alarming frequency of sewage discharges. For the sake of brevity, I will spare Members the statistics, but they represent the chronic under-investment in our sewerage infrastructure over a sustained period. That is a feature, not a bug, of how the water industry has been set up. If that was not evidence enough, we have only to look at the last two floods of Northwich town centre, which were caused not by the river’s flood defences overtopping, but by insufficient capacity in our drains to deal with the volume of water.
As stewards of our environment, we have a responsibility to act and it is good that the Government is doing that, not only through the Water (Special Measures) Bill, but through the independent commission on the water sector regulatory system. We must continue to advocate for the transformation of how the water industry is run, and seek to speed up the delivery of upgrades to our sewage infrastructure to clean up our waterways for good.
Helen Maguire (Epsom and Ewell) (LD)
The River Mole flows through my constituency. In 2024, it suffered over 2,000 additional hours of sewage discharge in comparison with 2023, despite similar rainfall. Does the hon. Member agree that despite recent efforts to protect our waterways—we appreciate what the Government are doing—the problem continues to worsen, and the Government must be more ambitious in their action to hold water companies to account?
Andrew Cooper
The hon. Lady makes a fair point. We are certainly at the start of the journey, not the end, so there is more to do to get the issue under control.
I will highlight the importance of citizen science initiatives and active involvement from communities and campaign groups such as Restore the Weaver and Northwich River Heroes, which often provide invaluable data that complements the work done by organisations such as the Environment Agency. It is a shame, however, that the EA has had to rely on such people, rather than being properly resourced for the task at hand.
I am pleased we now have a Government who have swept away the inertia, neglect and failure that characterised the previous Government’s approach to the activities of water companies and the protection of our waterways. Like my Labour colleagues, I have hope for a future in which we can look on poor river quality as a thing of the past.
Jim Shannon (Strangford) (DUP)
I thank the hon. Member for Monmouthshire (Catherine Fookes) for setting the scene. I am aware that the Minister serves on the Water (Special Measures) Bill Committee and has been a sterling voice in examining the legislation aimed at safeguarding our rivers and improving water quality.
I remember that wee song “Messing About on the River” from when I was a child—which was not yesterday, by the way. I will not sing it now, because if I sing there will be thunderstorms outside, but I am conscious that water has featured in all our lives from an early age. I will give the Northern Ireland perspective, where we have the Department of Agriculture, Environment and Rural Affairs—
Jim Shannon
I was not sure if I could give way, Mr Dowd, because I am conscious of the time.
Some of the main pollution sources include agricultural run-off containing fertilisers, pesticides and animal waste. The National Farmers Union and the Ulster Farmers Union have committed to reducing their fertiliser use. Has the Minister had a chance to discuss that with them?
The hon. Member for South Antrim (Robin Swann) referred to Lough Neagh, which is the largest freshwater lake in Northern Ireland. It drains around 40% of Northern Ireland’s land, of which three quarters are agricultural, and also supplies the water quality for the best part of Northern Ireland. Has the Minister had an opportunity to discuss that with the relevant Minister back home in Northern Ireland, Andrew Muir, to ascertain his opinions about what would be possible?
DAERA has water quality improvement strand funding, which has been running since 2020. It has benefited 47 local projects and provides some £900,000 each year. That scheme has benefited Northern Ireland. Has the Minister had a chance to discuss that with the DAERA Minister?
The Government are committed to improving water quality, and, for Members such as myself, who represent coastal areas with seaside villages, such issues are of major importance to many constituents, and more must be done to ensure adequate water quality. I would like the Minister to commit to further engagement with his counterparts in the devolved Administrations to ensure that we can all pave the way to having healthy and decent water quality.
Julia Buckley (Shrewsbury) (Lab)
My constituency is the beautiful, historic town of Shrewsbury, and we are famously surrounded by what we affectionately call “the loop”—the River Severn. In the past, we enjoyed the benefits of having such a beautiful, natural resource flowing through our town centre; it is fabulous for tourists and other people who enjoy walking along its banks.
However, after the last 14 years of illegal sewage dumping by Severn Trent Water, to which the last Government turned a blind eye, we have been left with a toxic, filthy river that poses a health risk to my residents. Our abundant wildlife has declined, our annual fishing contest has been cancelled and infection rates of diseases such as E. coli are on the rise among wild swimmers, paddle boarders and rowers. That affects our tourism industry and local businesses, as well as the quality of life for our local residents.
The huge volume of sewage dumped in our river by Severn Trent Water arrived not just through the 32 sewage outflows in our town centre, but, far more worryingly, through manholes on the pavement of our river paths. Sewage outflows are monitored, but manholes are not. Families, schoolchildren and dogwalkers have to wade through human excrement, sanitary products and wet wipes.
This disgraceful state of affairs is completely untenable and must be tackled urgently, so I wholeheartedly welcome the Water (Special Measures) Bill, which this Labour Government have brought so quickly to the table. It will ensure the increased accountability of private water companies so that they step up in their responsibilities to invest in the infrastructure that will better manage the sewage, rather than allowing it to pollute our watercourses.
In Shrewsbury, as in most constituencies, much of the scrutiny work is carried out by my local volunteer campaign group Up Sewage Creek—a brilliant group with a brilliant name. It recently raised its own funds to purchase more water testing kits so it can prove the impact of the overflowing manholes, which, as I said, are not already monitored. Many of my campaigners have become so frustrated that they are now pushing for nationalisation, and I understand their frustration.
Cameron Thomas
Will the hon. Lady join me in celebrating the activities of local campaigners who do so much to bring this scandal to light?
Julia Buckley
As I was saying, many of my campaigners have lost all confidence in those water companies. Although I understand their strong feelings, especially given that Severn Trent Water has given out large bonuses and is about to increase our bills by 46%, I also recognise that the Water (Special Measures) Bill will do exactly that: it will put the water companies into special measures. It puts them on notice by scrutinising them and pushing them into corrective action with transparent governance scrutiny.
I would go further still, so my message to the water companies is that this is their last chance saloon. All eyes are on them, and the water commission will look at alternative governance mechanisms. Both for my wildlife and the health of my residents, time is running out.
Clive Jones (Wokingham) (LD)
It is a pleasure to serve under your chairship, Mr Dowd. I thank the hon. Member for Monmouthshire (Catherine Fookes) for securing this important and timely debate. Not a single stretch of river in my constituency is in good overall health—what a damning indictment of the Conservatives’ failure. Instead of fixing the sewage scandal, they passively allowed it to persist. It is interesting that only one Conservative Member is present.
Last month, Ofwat permitted Thames Water—the company responsible for sewage in Wokingham—to raise water bills by 35%. Thames Water has been a disaster for our water quality in Wokingham. In 2023, it was responsible for 130 sewage spills, which lasted for 943 hours. It is failing Wokingham’s rivers, which includes the beautiful River Thames and the River Loddon.
Ofwat has allowed Thames Water to charge my constituents 35% more on their water bills for the next five years, and for what? This morning, the Financial Times reported that Thames Water intends to circumvent Ofwat’s cap on bosses’ bonuses by gifting its executives huge pay rises. Neither I nor my constituents will stand for our water bills being hiked during a cost of living crisis only for our money to go into the pockets of the most well-paid company directors.
Does the Minister honestly expect us to trust Thames Water to behave responsibly with even higher bills, when it feels like a new story is published every day about its mismanagement of our waterways? Will the Minister make it clear to the Secretary of State that a special administrative regime is absolutely needed—and needed now—to reset this unsalvageable mess; to ensure that the existing situation, where more than a third of customer bills go towards paying interest on Thames Water’s debt, ceases; and to ensure that the money is instead spent on infrastructure improvements? For too long, customers have been asked to pay the price for the company’s failures. That has to stop.
Joe Morris (Hexham) (Lab)
It is, as always, a pleasure to serve under your chairship, Mr Dowd. I commend my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing this vital and important debate.
The quality of our rivers, lakes and seas is a concern not just for my constituents in Hexham, but nationally. I am pleased to see so many hon. Members, from most parties, in the Chamber today to share our commitment to protecting and improving water quality throughout the country.
The alarming and extremely dangerous threat of pollution and sewage not only harms our wildlife and ecological systems—our rivers are flooded with sewage on a daily basis, which cannot be ignored—but dramatically damages the tourism business in my constituency of Hexham, which is home to some of the most beautiful landscapes in the country and to most of Northumberland national park, which I invite all hon. Members to visit. I am extremely proud that the Government’s Water (Special Measures) Bill is taking the necessary first steps towards addressing the poor performance of our water companies by increasing regulation over them and criminalising the sewage pollution of our waters. The Bill is a vital step to effecting broader change across the sector. I know that the Minister sees it as a much-needed first step in challenging those practices after 14 years of neglect.
I pay tribute to groups such as the Wylam Clean Tyne group, which found in 2022 that pollution in our River Tyne exceeded safe levels by over 15 times, a shocking indictment of the previous Government’s legacy. From the River Tyne to Kielder Water and Derwent reservoir, and hidden waterfalls such as Linhope Spout and Hareshaw Linn, near Bellingham, my constituency has some of the most idyllic waters in the country. We also have wildlife: woodpeckers, spotted flycatchers, wood warblers and badgers can all be seen in my constituency, as well as a number of freshwater fish—since I was elected, some Members have told me that they occasionally go fishing in my constituency. We need to protect the quality of those waters not only because it is the right thing to do but because of the fundamental difference that would make to my constituency and its local economy.
I again thank my hon. Friend the Member for Monmouthshire for securing this debate, and thank the Minister for her work. I join all my constituents in calling for the Government to go further to make sure that our rivers are properly protected.
Peter Dowd (in the Chair)
I gently remind Members that referring to who is and is not present is the road to perdition.
Ellie Chowns (North Herefordshire) (Green)
It is a pleasure to serve under your chairship, Mr Dowd.
I thank the hon. Member for Monmouthshire (Catherine Fookes) for securing this debate on a hugely important issue that is of deep concern to residents in my constituency of North Herefordshire, which, like hers, is in the Wye catchment. The Lugg, which runs through the centre of my constituency, is a tributary of the Wye. The tributaries of the Lugg are also particularly heavily affected by water pollution, which is one of the reasons why I founded the all-party parliamentary group on water pollution on entering this House in the middle of last year.
Water pollution has terrible effects on wildlife, on people’s ability to swim in and use rivers, and on the economy. Hundreds of millions of pounds of damage have been caused to the Herefordshire economy because the levels of pollution mean that we have had a moratorium on house building since 2019—that is really serious damage.
It is not just a local issue; we have heard today about what is happening all over the country. The Office for Environmental Protection in its report last year, on our prospect of meeting the legally binding 2027 target, said that we are “off track”, and it is deeply concerning that we are failing to meet that target. We need additional measures, including additional local measures, so I call on the Minister, when she winds up, to tell us what additional measures she will take to tackle water pollution.
When I have pressed Ministers on this topic—including this Minister and the Secretary of State—in the House, they have referred to the water commission. I have read its terms of reference several times, but can the Minister tell me where they refer to the problem of agricultural pollution? They do not—I have read them very carefully. The commission does not tackle the elephant in the room. Agricultural pollution is responsible for more pollution across the country than sewage is. In constituencies such as mine, in the Wye catchment, it is the large majority.
We know what the solutions are. We need a plan and proper funding for the Wye catchment plan. We need proper funding for nature-friendly farming, because farmers have the solutions to this issue at their fingertips, but they need the Government’s support. We need the Environment Agency to have the funding and teeth it requires, including to level on-the-spot fines. Fundamentally, we need Government to grasp the nettle and to tackle agricultural pollution as seriously as sewage pollution.
Alison Hume (Scarborough and Whitby) (Lab)
It is a pleasure to serve under your chairmanship, Mr Dowd. I congratulate my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing this important debate.
The title is exactly right: if we are to properly tackle water pollution, it must be from the source to the sea. I rise to talk about River Esk, the beautiful 20-mile long river that flows through my constituency to reach the North sea at Whitby. It is widely used for bathing and recreation, and the species found in it are important, ecologically and commercially. Its coastal waters are home to the European lobster and brown crab, while the tidal river is home to the freshwater pearl mussel, Atlantic salmon, sea trout and European eel.
The pearl mussel is critically endangered, and the last population in Yorkshire is to be found in the River Esk. It is dependent on the salmon and trout populations in the river during its lifecycle. The Esk once teemed with Atlantic salmon, whose numbers were a key indicator for clean water—but no longer, sadly.
The pearl mussel breeding project receives funding from Yorkshire Water, yet one of the key threats to it and to the salmon in the Esk comes from sewage discharges. Eighteen storm overflows discharge into the Esk. In 2023, there were 637 sewage spills from those overflows, with a combined duration of 2,757 hours.
However, the infrastructure—both material and regulatory—to keep the River Esk clean is crumbling and unfit for purpose. I recently visited the Yorkshire Water treatment plant at Egton Bridge, where the bank it is on is clearly subsiding into the river, and nearby manhole covers explode due to the water pressure when there is heavy rainfall. The company responsible for all this—Yorkshire Water—has paid out dividends worth £525 million since 2018.
I therefore warmly welcome the Government’s Water (Special Measures) Bill, which will require independent monitoring and hit polluters such as Yorkshire Water where it hurts—in their bank balance. Water company profits come at the expense of communities such as mine.
Pippa Heylings (South Cambridgeshire) (LD)
It is a pleasure to serve under you, Mr Dowd. Like our rivers, lakes and seas, our chalk streams are choked with a cocktail of chemicals and sewage. Water shortages are already becoming critical. That is the case in my constituency, which is home to precious chalk streams that are under threat.
The Conservative Government failed to stop water companies dumping raw sewage, and Ofwat continues to fail to regulate them. There was some hope that river basin management planning would achieve an overview and a strategic framework for managing our waterways’ different uses and challenges. However, as has been mentioned, the Office for Environmental Protection was clear that there are not enough specific, time-bound and certain measures in the river basin management plans to achieve environmental objectives, and that there had been insufficient investment in measures to address all major pressures. Yesterday, the Government said in their response to the OEP’s report on progress in improving the natural environment that the issue will be addressed by the independent commission into the water sector regulatory system led by Sir Jon Cunliffe. It is critical that the commission takes a holistic look and includes chalk streams in its review.
Storm overflows and untreated sewage regularly make headlines, but they are just part of the problem. As we have heard, phosphorous pollution is the most common reason why water bodies in England fail to achieve good ecological status, with over half of rivers failing targets. Phosphorous in the water environment comes largely from the continuous discharge of treated wastewater by the wastewater industry, with that effluent responsible for around 70% of the total load. That is endangering our chalk streams, which are a natural treasure and among the rarest habitats on earth. They are our unique heritage—as precious as the Great Barrier Reef is to Australia or as the Amazon rainforest is to South America.
The rare and beautiful chalk streams in my constituency are like a song, and the singers are the river groups that protect them: the friends of the Rivers Mel, Rhee, Granta, Shep, Orwell and Wilbraham and of the Cherry Hinton Brook, and the Cam Valley Forum. These chalk streams are under siege. Enough is enough: we need to give them specific protected status now.
Olivia Bailey (Reading West and Mid Berkshire) (Lab)
It is a pleasure to serve under your chairship, Mr Dowd. I thank my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing this vital debate. I will focus my speech on the protection and restoration of our country’s precious chalk streams—precious because of not just their unique ecology but their unique association with the English countryside.
There are estimated to be only around 200 chalk streams in the world, and the vast majority are in England. I am proud that two of them—the Pang and the Kennet—run through my constituency. Not only are their nutrient-rich waters home to a rich diversity of species, but they are beloved by local anglers, dog walkers and families. Their beauty has inspired many, with the Pang said to be the inspiration for “The Wind in the Willows”.
However, the Pang and the Kennet have seen a devastating decline in recent years. According to Environment Agency data, the Pang’s ecological status has gone from good in 2016 to moderate in 2019, and it is now rated as poor. Last year, I tested the Pang with local campaigners from the Angling Trust and found that phosphate levels were three times what they should be. That leads to increased algae, depleted oxygen and significant damage to wildlife, plants and fish. Action for the River Kennet has estimated that Thames Water’s sewage works account for 52% of the phosphate pollution in the river, but Thames Water has so far refused to include phosphate stripping in its plans for the sewage works at Hampstead Norreys. It has said it will review the issue, but that is not good enough: we need real action, and I call on Thames Water for just that.
I welcome the actions the Government have taken to tackle the water companies that have been acting without accountability for too long. The Water (Special Measures) Bill will finally penalise water bosses who pollute our water. I am looking forward to working with the Minister to clean up the Pang, the Kennet and all our chalk streams—an ambition I know she shares.
The beautiful west Berkshire villages nestled along the banks of the beautiful River Pang have suffered terribly as Thames Water has pumped raw sewage into the river. In Hampstead Norreys, raw sewage ran for months down the main street; in Compton, residents had to erect a sign to ask drivers to drive slowly so that they did not splash schoolchildren with putrid water.
Enough is enough: we must restore our chalk streams to their former glory, so that the Pang—captured so wonderfully by Kenneth Grahame in “The Wind in the Willows”—can continue to be
“a babbling procession of the best stories in the world, sent from the heart of the earth to be told at last to the insatiable sea.”
Dr Danny Chambers (Winchester) (LD)
It is a pleasure to serve under your chairmanship, Mr Dowd. I congratulate the hon. Member for Monmouthshire (Catherine Fookes) on securing this debate. There are two chalk streams in the Winchester constituency—the River Itchen and the River Meon. The River Itchen flows through the heart of our city; it is not just a beautiful part of our environment but part our cultural heritage as well.
There has been a lot of talk about chalk streams in the Chamber today, including in the eloquent contribution of my hon. Friend the Member for South Cambridgeshire (Pippa Heylings). However, we must remember never to take these streams for granted. There are only 210 chalk streams in the world, and 85% are in southern England. The biodiversity and ecosystems of some of them are completely unique, and these streams have been designated as sites of special scientific interest. In the southern chalk streams, for example, the Atlantic salmon are genetically distinct from those in the rest of the ocean. In that respect, dumping sewage and other pollutants in sites of special scientific interest is not only morally wrong but an act of ecological vandalism.
Although we support many of the measures the Government have brought forward, after the last Government ignored sewage dumping for so long, we have a couple of specific concerns about chalk streams. One is about the recent statement confirming plans by the Department for Environment, Food and Rural Affairs to scrap the chalk stream protective pack, without anything else being announced specifically to replace it. Chalk streams form over millions of years and are a unique part of our heritage. The Government need to recognise their importance and not merely lump action on them in with other protective measures. Will the Minister therefore please discuss the Department’s plans to put together a chalk stream-specific recovery plan and to achieve special protective status for all chalk streams?
To finish off, I congratulate and pay tribute to all the community groups in Winchester that work so hard on chalk streams—the citizen scientists, the Hampshire and Isle of Wight Wildlife Trust, and the river keepers. They are really working hard, and we and the Government need to support them in every way we can.
Anna Gelderd (South East Cornwall) (Lab)
It is a pleasure to serve under your chairship, Mr. Dowd, and I thank my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing this important debate.
South East Cornwall is known for its beautiful environment, both on land and at sea, which attracts millions of visitors every year. Yet we face a growing water quality crisis, which threatens our environment, public health, livelihoods and local biodiversity. South East Cornwall has been ranked 14th in the UK for the number of hours of sewage dumping in 2023. In Duloe, residents and the parish council have been instrumental in raising awareness. They came together to campaign against the high levels of sewage being dumped in the Looe river, and through their efforts achieved improvements in the river’s water quality.
Good water quality in our rivers, lakes and seas is vital to rural and coastal communities such as mine. Tourism is essential to Cornwall’s economy, but it relies on clean beaches and safe waters. Poor water quality deters visitors, which really impacts the small businesses that depend on them, as well as wild swimmers, some of whom have reported illness, including members of my own wild swimming group.
Lisa Smart (Hazel Grove) (LD)
The hon. Lady talks about swimmers falling ill because of sewage dumping, and the same thing has happened to groups of teenagers in my constituency. The most recent issue with sewage dumping in my patch involved a flooded field, and I am grateful to all the constituents who sent me photos of the raw sewage in that field. I am sure the hon. Lady will agree that the Water (Special Measures) Bill is a real opportunity to move forward and tackle some of these issues, but does she also agree that we need to go even further, possibly by having a sewage tax—
Peter Dowd (in the Chair)
Order. Will people pay respect to the Chair’s decision? When I ask you to sit down, would you please do so? Thank you very much.
Anna Gelderd
Thank you, Mr Dowd, and I thank the hon. Lady for her intervention.
I thank Feargal Sharkey, who visited my constituency last summer, and I thank the Minister for all her work on this important topic. Feargal Sharkey met local residents with me and heard the strength of local feeling on this issue. Our fishing communities suffer from poor water quality, which can cause habitat degradation and put our commercial catches at risk. Research by the Marine Conservation Society and the University of Portsmouth has shown a worrying increase in chemicals such as per- and polyfluoroalkyl substances in seaweed. PFAS, which are known as forever chemicals because of their highly persistent qualities, do not break down in our natural environment. They accumulate in the environment and in our food chain, impacting biodiversity and public health. This is a serious concern, and I look forward to working with the Minister to do more to address it.
Labour’s Water (Special Measures) Bill is a much-needed first step towards improving the accountability and performance of water companies, which is something I welcome and I congratulate the Minister on. It is time to ensure that water bosses can no longer sell us down the river. Customer service, environmental protection and investment in infrastructure must be prioritised over profit in relation to what is fundamentally a public asset.
Peter Dowd (in the Chair)
Order. I ask the hon. Gentleman not to intervene, because we are right up against it. Thank you.
Anna Gelderd
I know my hon. Friend the Member for St Austell and Newquay (Noah Law) is an important champion for Cornwall as well.
South East Cornwall’s beautiful, natural environment is priceless, and I applaud the determination of my local residents to make a difference. We also have the national leadership that is so essential to tackle this crisis. The Government are already taking action to clean up the mess that we inherited, and we know that the Water (Special Measures) Bill is a vital first step to support constituencies such as mine, and local campaigners in them. I look forward to working with the Minister to restore water quality, protect our environment, improve public health and secure livelihoods in South East Cornwall.
Dave Robertson (Lichfield) (Lab)
It is a pleasure to take part in a debate with you in the Chair, Mr Dowd. Diolch yn fawr to my hon. Friend the Member for Monmouthshire (Catherine Fookes) for securing this debate.
There has been a lot of talk today about the issue of sewage dumping and the important Water (Special Measures) Bill, which I fully support. However, I am here to talk about Bown Pond in Fradley, a village in my constituency. On 11 December last year it had a serious pollution incident involving not sewage, but some form of hydrocarbon—probably an oil, but we are yet to see the result. The lake is well respected by local residents and it is a huge amenity for the village, but when the foam discovered on the surface of the pond was identified, that was followed by almost all the fish in the pond dying and a whole family of swans needing to be transferred to Linjoy Wildlife Sanctuary in Burton. I really commend the sanctuary for its work, but unfortunately it was unable to save the cygnets and had to put the swans to sleep, because whatever was in the water had burned the swan’s tongues, leaving ulcers. That was a real concern to residents in Fradley and me, and a very distressing incident for everybody concerned.
I know the Environment Agency is working hard on it, but almost a month later we have not yet had the results of the investigations into the water. At this point, I ask the Minister: can we look very closely at the resourcing of the Environment Agency? After 14 years of cuts upon cuts, we need to make sure that we are giving that vital piece of our regulatory framework the resources that it needs to investigate such incidents and make sure that prosecutions follow up where necessary.
Peter Dowd (in the Chair)
I would like to give Catherine Fookes a minute or two at the end to wind up, so I hope the Minister and spokespersons will bear that in mind.
Tim Farron (Westmorland and Lonsdale) (LD)
It is a genuine pleasure to serve under your stewardship, Mr Dowd. I pay tribute to the hon. Member for Monmouthshire (Catherine Fookes), who made a great speech, and has introduced this important issue to this place this morning. I pay tribute to all Members who made remarks during this debate, including, of course, the references they made to the issues that they face in their communities. This is a nationwide issue, which the Liberal Democrats have chosen to champion—we are so committed to cleaning up our waters that our leader refuses to stop falling into our waterways until this matter is resolved.
We are talking about lakes, rivers and seas, and I have them all in my patch—well, not all of them, but a large chunk of them, as the Member of Parliament for the English lake district. I will not list off all the lakes and rivers, as I have been known to in the past, because we only have so much time. We are all proud of our constituencies, and it is a huge privilege to represent mine, but we recognise that in our communities we are there to be stewards of, and to preserve, the lakes, rivers, becks and tarns, and Morecambe bay in my constituency —not just for us, but for everybody else.
Those are national parks, and the lake district is even a world heritage site, so while what happens in our waterways is deeply personal to us, we also recognise it is of great significance to the future of our country and indeed even of our planet. The impact on our ecology, biodiversity and water quality is important, but let us not forget—as has been mentioned by other Members—the importance to our tourism economy. Some 20 million people visit the lakes every year and they deserve to visit a place that is as pristine as it should be.
I will run through some of the issues affecting our communities. Just last year, the Shap pumping station released sewage for 1,000 hours into Docker beck and sewage was dumped into the river Lowther at Askham water treatment works for 414 hours. In November last year, we found that the number of poor bathing waters had risen to the highest level since the introduction of the four-tier classification system. That shamefully included Coniston Water. Windermere had sewage dumped into it 345 times, totalling 5,259 hours over the course of 2023.
I will say a quick word about pollution in lakes. A drop of water that enters Windermere at the north end takes nine months to work its way through, so the impact of sewage on bodies of water such as lakes and tarns is even greater than it is on our rivers and seas. The impact on Morecambe bay is hugely significant as well. We saw 757 sewage dumps there just in 2023. One of the things that is so grievous is the impunity with which those things take place. In 2021, there were 500,000 sewage dumps across the United Kingdom, and a grand total of 16 of them were deemed liable for prosecution. Of those, eight attracted fines of less than £50,000. In other words, it was worth the water company’s while to dump that sewage, because there was no way of holding it to account.
I have said this before, and it is so important: we speak with such passion on all sides about this issue, yet thousands of people are working in our water industries—for the water companies, for Ofwat, for the Environment Agency and for various other bodies—and I pay tribute to them. The temperature of this debate can often be high, and I want them to know that they are valued, and that we do not blame them; we blame the system within which they work. Radical change is needed.
It is a privilege to serve alongside the Minister and others in this place on the Water (Special Measures) Bill Committee. Alongside my hon. Friend the Member for Witney (Charlie Maynard), we have tabled 44 amendments to that Bill; not one of them has been accepted so far, but we have one more day to go, so here’s hoping. That demonstrates our commitment to trying to engage proactively with this issue. We think it seriously matters. The issues we have sought to highlight through that Committee include the need to create a new clean water authority, to have special priority for waterways in national parks and for chalk streams, to protect our rivers and drinking water from forever chemicals and to put environmental experts on the boards of water companies.
The Government—I praise them for this—are rightly putting citizen science at the heart of monitoring. They need to do two things if they are serious about that, and one is to make sure that they equip, support and resource those citizen scientists. I pay tribute to Save Windermere, the Clean River Kent campaign, the South Cumbria Rivers Trust, the Eden Rivers Trust and many others in our communities, but those people need to be on the boards and committees so that they can influence decisions, as well as being equipped to hold people to account. We need radical change, and I fear that this Government are not quite proposing it.
We have a real problem when it comes to regulation. In the end, we have a fragmented regulatory framework. Ofwat, the EA and other bodies are under-resourced and underpowered and the system is fragmented, so the water companies simply run rings around them. The evidence of that is that Ofwat levied £168 million of fines nearly four years ago against three water companies, and it has collected a precise total of zero pounds and zero pence from them, because it simply does not have the culture and powers it needs. Before Christmas, it sanctioned a more than 30% increase in our water bills. In the north-west alone, 11% of all our water bills is going to service the £8.9 billion debt of United Utilities, and it is far worse with Thames Water and in other parts of our country.
People have mentioned farmers and farm run-off. One of the major problems with the agricultural impact on pollution is the past Government’s and this Government’s botching of the transition to the new farm payment scheme. This Government taking 76% out of the basic payment this year will push a load of farmers to move away from environmental action altogether. It will be massively counterproductive. Back our farmers and they will help us to clean up our environment.
In short, we in the Liberal Democrat corner of the Chamber—well represented this morning, as always—are impatient for change. We welcome and support the Bill. As a bit of an old-timer, I neutrally observe that Labour Governments tend to fall into one particular trap: they always assume they will be in power for longer than they actually will be, and they drag their feet and do not do the radical things they should. I say to them: “You’re already at least 10% of the way through this Parliament—get on with it!”
Robbie Moore (Keighley and Ilkley) (Con)
It is a pleasure to serve under your chairmanship, Mr Dowd. I congratulate the hon. Member for Monmouthshire (Catherine Fookes) on securing this really important debate. Improving water quality is something that we all care about, on all sides of the House. Making sure that all those who pollute are held—in the strongest possible terms—to account and that those who need to carry out improvement measures to improve water quality are incentivised to do so matters to us all. That is why, when the Conservatives were in Government, we took action.
The narrative that has been put across by many hon. Members in their contributions to this debate, that the last Conservative Government did nothing, is for the birds. We brought in the Environment Act in 2021; we introduced a plan for water that was about more investment, stronger regulation, and tougher enforcement. Of course, it is vital to understand where the problem lies, which is why we increased monitoring. Back in 2010, only 7% of storm overflows were monitored. We are now at 100%.
We have also seen designated bathing water sites improve their water quality status from 2010, when only 76% of bathing water sites were classified as good or excellent. We are now at 90%, despite stronger regulation having been brought out in 2015. We introduced the ban on water company bosses’ bonuses. We linked dividend payments to environmental performance. We removed the cap on civil penalties from £250,000 per incident to an unlimited amount. We also brought forward the largest infrastructure programme, with £60 billion allocated to revamp ageing assets and reduce the number of sewage spills, allocated funds specifically for our farmers to store more water on their land through water management grants and rolled out the slurry infrastructure grant.
Peter Swallow
The hon. Member mentions the monitoring of overflows. Will he put on record for the House how many emergency overflows were being monitored under his Government?
Robbie Moore
I come back to the point that monitoring is incredibly important. This is why we brought out a requirement for all water companies to specifically carry out more monitoring: before 2010, only 7% of storm overflows were monitored. That is completely unacceptable. We needed to understand the problem so that we could not only use our regulators to enforce water companies to carry out the level of investment we would expect of them, but strongly hold those water companies, and indeed all polluters, to account. I encourage the Government to keep going with that, which is why we have taken a constructive approach to the Water (Special Measures) Bill that is working its way through the House.
There are three points which I want to focus on and I would be grateful if the Minister could address them in her response. First are the points that have been made by my right hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman), to do with the £35 million allocation to the River Wye action plan, announced earlier this year. The River Wye action plan was specifically designed to address those challenges to do with pollution from our farmers. The plan set out a range of measures to begin protecting the river immediately from pollution and establish a long-term plan to restore the river for future generations. That included requiring large poultry farms to export manure away from areas where they would otherwise cause excess pollution and providing a fund of up to £35 million for grant support for on-farm poultry manure combustion combustors in the River Wye special area of conservation. The plan also appointed a chair.
I would therefore like to ask the Minister why the plan has been dropped, despite those things having been put in place? Where has the £35 million been reallocated? We are now six months into this Labour Government, but yet there has been no announcement on the River Wye and I fear that there will be no action taken. We are almost coming up to a year since that plan was worked on. If the Minister could update the House on that, it would be greatly appreciated.
The second point is the water restoration fund, which was specifically designed to ringfence money that had been collected from those water companies that had been polluting, to focus specifically on improving water quality. The fund, when it was announced, allocated £11 million-worth of penalties collected from water companies to be offered on a grant basis to local support groups, farmers, landowners and community-led schemes. Hon. Members have talked about how good their local campaigners are at utilising funds that are provided to them, and I absolutely endorse that, but that fund was specifically ringfenced for penalty money reclaimed from water companies to be reinvested.
The Government are not taking the water restoration fund forward, so will the Minister accept the Conservative amendment to the Water (Special Measures) Bill on that point? The water restoration fund came exclusively from water company fines and penalties, which are in addition to any other work the company must carry out to repair breaches that it has caused. Will the Minister explain why the Government are not continuing the fund, and why she does not think it is important that water companies clean up their own mess when money has been collected from them?
Andrew Cooper
The previous Government cut the environmental protection budget for the Environment Agency from £170 million in 2009-10 to £76 million in 2019-20. Does the shadow Minister accept that some of the actions that he has spoken about might not have been necessary had the Environment Agency been funded properly to carry out the important work that it was doing?
Robbie Moore
We all have to acknowledge that water companies have not been meeting their environmental obligations for far too long. That is why we implemented the monitoring. Regulators—Ofwat, the Drinking Water Inspectorate and the Environment Agency—need robust powers so that they can carry out enforcement.
The water restoration fund ringfenced money collected from the water companies and that allowed farmers, landowners and the many great campaigning organisations that want to carry out nature-based solutions to improve water quality, and there was the additional expectation that water companies put in place their own improvement measures. I ask the Minister: why on earth would the Government not want to continue that approach?
My third point is about bathing water designations, which are a fantastic way of reassuring those who want to bathe in specific areas, whether our lakes, rivers or coastal environments. They also put a greater obligation on the Environment Agency and water companies to carry out additional monitoring.
In May 2024, I was delighted to announce 27 new bathing water sites ahead of the 2024 bathing water season. That brought the number of bathing water sites across England up to 451. In addition, I announced a review of the bathing water regulations, which I had been advocating for some time. Our constituents do not just swim at bathing water sites, but use them for other activities, including canoeing, kayaking and other water-based activities. I very much wanted to see the review of the bathing water regulations, and we announced the change to increase the user basis. I also wanted to see an increase in bathing water designations beyond May to September so that all-year monitoring could take place, and the removal of the automatic de-designation of poor sites so that sites that had been consistently rated poor could keep their designation to keep up the pressure on the water companies and the Environment Agency to continue monitoring. Will the Minister update the House on what is happening with that announcement, which was made last year? What is she doing to ensure bathing water regulations are enhanced and improved?
In the run-up to the general election, Labour made huge promises about what it would do to improve water quality. I feel that it is falling far short on its promises to the electorate. Although we will work constructively with the Government to improve their measures, campaigners—it is not just me—feel that the Water (Special Measures) Bill does not go far enough, and investors feel that they are being penalised while the Government expect them to carry out improvement measures. The Government are penalising our farmers, not only through the family farm tax, but by not providing water grants to them to carry out improvement measures.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
It is a pleasure to serve under your chairmanship, Mr Dowd. I thank my hon. Friend the Member for Monmouthshire (Catherine Fookes) not only for securing this debate but for her work on the Water (Special Measures) Bill. I thank all the campaigning groups and environmental groups that have been mentioned throughout the debate for the work they do in our communities. The number of MPs who have attended the debate—or at least, the number on the Government Benches—shows how popular and important it is.
As I listened to the comments from the shadow Minister, the hon. Member for Keighley and Ilkley (Robbie Moore), I felt a little confused, because he does not seem to recognise or understand the level of anger and resentment towards his Government on this issue. He listed all the amazing achievements of the previous Government. I wonder how those stack up against the facts we have heard in the debate about the level of sewage that is being pumped into our rivers, lakes and seas, the ecological standard of many of our rivers, lakes and seas and the fact that people are so angry about the situation. I gently suggest that, rather than try to rewrite history or place alternative facts on to the record of Hansard, he would do better to acknowledge the fact that his Government got this issue so dreadfully wrong. That is why—as we have in many Departments and on many issues—we have had to come and, in this case, literally clean up the mess we have been left with.
The quality of our rivers, lakes and seas and our water is essential for supporting ecosystems, providing clean drinking water and producing our food, and of course, as Members have said, our beautiful rivers, lakes, seas and beaches are a source of pride for our communities, and we want to restore them to that. Maintaining healthy and clean water sources is vital to achieving this Government’s mission for economic growth, and the £104 billion of investment in the next five years in the water sector will help to clean up our waters and with very important job creation up and down the country.
Water systems are under massive pressure, no thanks to the 14 years of mismanagement that they have just gone through, and water bodies such as the River Wye and the River Usk in Monmouthshire face significant challenges due to agricultural run-off from intensive poultry farming, leading to high phosphate levels in our water. More broadly, my hon. Friend the Member for Monmouthshire is right to question the quality of our water due to increasing pressures from pollution, climate change and unsustainable practices.
The Government are prioritising water quality as a key element of their environmental and public health agenda. Significant steps are being taken to address pollution, enhance infrastructure and ensure clean and sustainable water sources for future generations. In his first week in office—it is slightly amusing that we are criticised by the Opposition for not solving all the problems in our first six months—the Secretary of State secured agreement from water companies and Ofwat to ringfence money for vital infrastructure upgrades, so that it cannot be diverted to shareholder payouts and bonus payments. The Government’s Water (Special Measures) Bill, which has been in Committee this week, sets out measures to crack down on water companies failing their customers, and the independent commission on the water sector regulatory system was launched by the UK and Welsh Governments in October 2024, as the third stage of this Government’s water strategy to clean up the mess we have inherited.
I will quickly respond to some of the contributions from my hon. Friends. My hon. Friend the Member for Bracknell (Peter Swallow) is right to share his upset and anger at the number of sewage spills damaging his constituency, which have continued for the past 14 years. I thank him for his support for the Water (Special Measures) Bill. Monitors will be installed and then verified independently. My hon. Friend the Member for Carlisle (Ms Minns) is a brilliant champion for her area, on both flooding and sewage, and I agree that we are blessed with many beautiful rivers, lakes and seas. I quite like the sound of that hidden river cabin; maybe that is worth a visit.
My hon. Friend the Member for Mid Cheshire (Andrew Cooper) mentioned the chronic under-investment in sewage infrastructure, and he is absolutely correct. That is why we need the £104 billion investment, to clean up and deal with the mess we have inherited. I will speak to the farming Minister, my hon. Friend the Member for Cambridge (Daniel Zeichner), and get a precise answer to the question asked by my hon. Friend the Member for Strangford (Jim Shannon)—I count him as an hon. Friend.
My hon. Friend the Member for Shrewsbury (Julia Buckley) talked about how appalled she is by sewage coming up through manhole covers. That sounds dreadful and I am happy to discuss that with her after the debate. I like the sound of Up Sewage Creek—that is a catchy name for a local campaign group. I thank her for her work, not just in this area. We have had many conversations and she is standing up for her community, as has been noticed and recognised.
My hon. Friend the Member for Hexham (Joe Morris) is right to highlight the damage to tourism in his beautiful constituency, and the work being done by local campaign groups. I thank him too for his support for the Water (Special Measures) Bill that will bring forward the reforms we desperately need.
My hon. Friend the Member for Scarborough and Whitby (Alison Hume) highlighted the decline in fish stocks, in an area near my constituency that I like to visit, and the need to tackle sewage and pollution. I thank her for her support. My hon. Friend the Member for Reading West and Mid Berkshire (Olivia Bailey) highlighted the important issue of phosphate pollution, and I am happy to support her work pushing Thames Water to tackle that.
My hon. Friend the Member for South East Cornwall (Anna Gelderd) championed her beautiful area of the country and highlighted the damage done by sewage. Having listened to the speeches given by Conservative Members, one might have imagined the problem had already been solved, but in reality it has not and it is damaging her beautiful area. She also raised the dangers caused by PFAS. My hon. Friend the Member for Lichfield (Dave Robertson) talked about an incredibly concerning serious pollution incident. I am happy to look into the issue and find out what is happening with the EA investigation.
The theme of agriculture came up during the debate. Working with farmers to reduce agriculture pollution is key to delivery against the Government’s priority to clean up our rivers, lakes and seas. The Environment Act 2021 set a legally binding target to reduce nitrogen, phosphorus and sediment contribution from agriculture by at least 40% by 2038. Alongside developing a new statutory plan to restore nature and meet those targets, this Government are enforcing key regulations, such as the farming rules for water, and have carried out thousands of advice-led inspections through the Environment Agency.
Investment is directed to environmental land management schemes, including the sustainable farming incentive, and supported by the catchment sensitive farming programme, which are designed to help farmers protect water quality and adopt sustainable practices while maintaining viable businesses. The Secretary of State announced just last week at the Oxford farming conference that we will ensure permitted development rights work for farmers, so we can support them to reduce water pollution through improved slurry stores, anaerobic digesters and small reservoirs.
In my remaining time, I will respond to the main points raised about the River Wye. This Government are actively progressing the next steps for the River Wye, including building stronger ties and working collaboratively with the Welsh Government, the Environment Agency and Natural England, as well as local MPs, farmers and ENGOs who are already doing great work to tackle pollution. Indeed, when I held a meeting with the River Wye partnership, which the hon. Member for North Herefordshire (Ellie Chowns) and others attended, and mentioned that we would not be continuing with the previous Government’s plan, those present applauded, such was their condemnation of that plan. I do not wish to test hon. Members’ knowledge of geography, but one of the main problems with the previous Government’s plan was that it did not involve the Welsh Government. I would suggest that any plan to tackle the River Wye’s problems ought to include consulting the Administration responsible for where the river starts and ends.
Ellie Chowns
Does the Minister agree that the problem with the way the £35 million was previously supposed to be spent was that it was the opposite of the “polluter pays” principle, because it was essentially a subsidy to the most polluting industry? Will she agree to find £35 million to support nature-friendly farming in the Wye catchment to solve the issue?
Emma Hardy
I thank the hon. Lady, but I have been told I have 15 seconds left. We will develop a plan for the River Wye and I will let hon. Members know about it as soon as possible.
The unacceptable destruction of our waterways should never happen again and we are working to tackle the challenge. Efforts are already underway locally and nationally that will support restoration of rivers. The independent commission will report in June 2025. I look forward to working with hon. Members to take this important agenda forward and clear up the mess that we have been left.
Peter Dowd (in the Chair)
I call Catherine Fookes, who has maybe 30 seconds to sum up.
Catherine Fookes
I thank all hon. Members for their contributions that demonstrate the strength of feeling in the House, especially from Labour Members, about the quality of our rivers, lakes and seas. We have had a tour, from Cornwall to Hexham, Whitby and everywhere in between. We heard about the idyllic sounding hidden river cabins and the not so idyllic sounding Up Sewage Creek in Shrewsbury. I thank the Minister for explaining what she is doing to work with us on the Wye catchment partnership. I look forward to all of us continuing to work to clean up our rivers, lakes and seas, so that we restore them to the wonderful quality they should have.
Question put and agreed to.
Resolved,
That this House has considered water quality in rivers, lakes and seas.
Town Centres: Stoke-on-Trent
(3 days, 7 hours ago)
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Karl Turner (in the Chair)
I will call Gareth Snell to move the motion and then the Minister to respond. There will not be an opportunity for the Member in charge to wind up, as is the convention for 30-minute debates.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
I beg to move,
That this House has considered Government support for town centres in Stoke-on-Trent.
It is a pleasure to serve under your chairmanship for this debate, Mr Turner, and to see Mr Dowd offering you a skilled hand.
This year is the centenary of Stoke-on-Trent, which was founded as a city in 1925, following the federation of the six towns in 1910. It is a city based on a partnership of equals: there are six towns, of which I have the pleasure of representing three and a half; I share one of them with my hon. Friend the Member for Stoke-on-Trent South (Dr Gardner). As we look forward to the next 100 years, our city has to consider the future of its town centres, what we hope to achieve in them, and what role they can play in delivering the Government’s ambitious programme of growth, housing and economic regeneration.
The past 14 years have been tough for my city. Had the last Government simply kept our revenue grant at its 2010-11 level in cash terms, there would have been over £400 million extra to spend in over that time. As it happens, they did not, and year-on-year cuts by the last Government have left the city in a perilous financial state. That has led to an undignified situation in which Stoke-on-Trent is forced to bid against our neighbouring cities simply to have a share of any prosperity fund, levelling-up fund or other fund—an undignified beauty parade that fails to recognise that every town and city centre in this country deserves to thrive.
Town centres are more than places for shopping. The town centres that I represent in Fenton, Hanley, Stoke and a part of Longton are about pride, community and dignity of place. They not only have an economic benefit, but are the mesh that holds society together in our city.
Dr Allison Gardner (Stoke-on-Trent South) (Lab)
Will my hon. Friend join me in commending the fantastic work of the Longton Exchange team and Urban Wilderness in their commitment to regenerating Longton town centre? Does he also agree that we need much more work and investment to return Longton to its full glory?
Gareth Snell
My hon. Friend has basically stolen one part of my speech, because I was going to congratulate Longton Exchange on the mini-renaissance that is taking place in that town, and in particular the work it does on the Longton carnival and the pig walk—unfortunately, I was unable to make it last year, but I very much intend to be there in April for this year’s. It is those sort of small cultural events—and the small but determined work of dogged individuals who love where they live and have pride in the place they call home—that will deliver the upturn and improvement to our town centres.
Jim Shannon (Strangford) (DUP)
I commend the hon. Gentleman for securing the debate. There will not be a town centre in this great United Kingdom that does not suffer from the problem of online shopping, which takes trade away from the town centre. Does he agree that one of the things that could be done—we look to the Minister on this—is to help micro and small businesses in city centres with start-up funds? Those businesses bring people in, bring employment in and help the economy.
Gareth Snell
The hon. Gentleman, as always, is absolutely right. He has hit the nail on the head. Whether it is Strangford or Stoke-on-Trent, the town centres and small and medium-sized enterprises, whether they are a service, a community organisation or retail, are sometimes the places that people have most affinity with because they have a personal relationship with the owner. In Stoke-on-Trent we find that the microbusinesses that can be run from someone’s garage or back bedroom thrive.
The big stores tend to be able to weather the economic climate that we find ourselves in, but for mid-sized shops the high street is probably just outside of financial reach because of business rates and because the footfall is not there. The high street is struggling because of the decisions of the last Government. Regardless of fault, things need to be addressed by the present Government. I have absolute confidence that the Minister and his team at the Department will do that.
I want to focus mostly on Hanley city centre, but I also want to pay tribute, as did my hon. Friend the Member for Stoke-on-Trent South, to the amazing work in Longton. I will not repeat what she has already adequately and wonderfully put on the record, but I want to briefly talk about Fenton and Stoke. Fenton is a town that Arnold Bennett did not really forget. He took it out of the books because he did not like his mother-in-law, but that is an entirely different debate.
The work being done around Fenton town hall to turn the area into a vibrant community hub is fabulous; I am thinking of Ben Husdan and the community interest company that he works with, and Restoke, which runs the town hall, and the Step Up Stoke charities. I hold my surgeries in the café there and when I have time off I go there to enjoy the city that I live in and call home. The events run there draw people in from all over the west midlands; they have demonstrated that, with determination and a little bit of community spirit, something wonderful can be achieved. A model has been put together that could be used in other parts of Stoke-on-Trent.
I also want to pay tribute to the work being done by Jeff Nash and his team at the Spode site in Stoke. A hub is emerging there with support from levelling-up funds. To give credit to the last Government, they put some money in, as did the city council. The site demonstrates that the heritage buildings in my constituency, which are sometimes considered to be part of our past, can actually be part of our future. And that demonstrates that with a bit of imagination and a bit of support, which I know the Government are committed to, we can deliver real regeneration, new homes and good quality jobs for the new future for the city that I think is there.
I turn to Hanley—possibly the most challenging town centre of the six towns that make up Stoke-on-Trent. The Minister is aware of that because he kindly met me, along with Councillor Jane Ashworth, leader of Stoke-on-Trent council, chief exec Jon Rouse, and Rachel Laver, the wonderful chief executive of the Chambers of Commerce. For many years Hanley has been a challenge. It has been seen as, “If we fix Hanley, we fix everything else”, and there is an argument that that is correct. But the solutions have always dwarfed the scale of the challenge.
Like Hull, Mr Turner, Stoke-on-Trent deserved more from the last Government. We were given levelling-up funds, but the last Conservative council decided that the best thing they could do with the support offered was to build a car park. An economically deprived city’s working age people in in-work poverty were told that their lives were going to be levelled up with the building of a multi-storey, colourful car park on the edge of the city centre—and “That’s your lot!” That car park, ironically, is now costing the council money because it was so poorly planned and executed that the revenue it should have generated is not there. It is now a loss for the council, which is a demonstration of the legacy of the last Government.
On top of that, the last Conservative council made grand aspirational plans for arenas and shopping centres. On paper, they looked wonderful—what the artist’s impression showed would be wanted in every town centre. But there was no plan, no money and no intention. That is something that the council learned from the last Conservative Government when it comes to economic regeneration across this country.
We look to the Government not to solve our problems for us—I want to be clear to the Minister that I am not here with a begging bowl to ask for handouts; I firmly believe that the future of our city has to be driven by our city—but for them to join us in a new partnership by putting the governmental shoulder behind our municipal wheel. If we are able to forge a new partnership for the city centre, we will meet the housing demand. We can more than meet the demands placed on us by Government, and then some, if we have the land consolidation powers that Homes England executes, and if we had a self-replenishing fund for the pump-priming work, and could look at remediation of brownfield sites.
We have the building blocks in the city centre. The work done by Richard Buxton, Jonathan Bellamy and Rachel Laver, through the city centre’s business improvement district, is phenomenal. They almost always have a bright idea about something we could do in Stoke-on-Trent to bring people into the city, whether that is food markets or their work on supplementing the municipal support they should have had from a council suffering budget cuts. That is the wardens, street cleaning and street scene work.
We have good policing led by Sergeant Chris Gifford, doing their best to ensure that the city centre feels safe. That is also a challenge because of the reduction in drug and alcohol support services that the previous Government thrust upon us, meaning that people who need help cannot get it, so they gravitate to our town centre, causing a social problem.
David Williams (Stoke-on-Trent North) (Lab)
I thank my hon. Friend for this important debate. He notes that crime and antisocial behaviour is an issue that can put off people coming to our town centres. I hear the point about how we use levelling-up funds or certain types of funds to make our town centres better. A key to that is how we engage with local community leaders and retailers to ensure we get the plans right. We got £20 million, including £6.5 million to make improvements to Burslem, Tunstall and Middleport, and we are looking at how we—
Gareth Snell
I hear what my hon. Friend is saying, but in a half-hour debate I do not have time to address all his points. He is right that reduction in crime in the town centre helps people feel safe and brings in more people to spend money there. There is a virtuous circle of activity that is not just about getting more shops on the high street, but making people who come feel safer.
That also links to public transport. One of the conversations being pursued locally, through the bus improvement partnership and the work we hope might come from future reorganisation and devolution, is that we can massively improve our public transport network, so we can get the people into town centres who want to shop there. At the moment, we have a perverse situation in which the bus station is far away from the shopping centre. Walking down the hill to get there is fine, but walking back up the hill is far too much for some—particularly older members of my community, who simply cannot make the journey and do not go there. It is those small things we can do that will massively impact on economic benefits.
I want to pitch to the Minister something he knows we aspire to. The challenge we now face in Stoke-on-Trent is that we cannot do it alone. We are not asking for it to be done for us, but we cannot do it alone. We would like to explore, with the Government and some form of urban development company, a delivery vehicle that allows the master plan being put together by the city council and the chamber of commerce to have cross-governmental support, demonstrating to businesses in my city that we are taking this seriously.
The other problem we have had, which you will probably have experienced in Hull, Mr Turner, is that plan after plan is written, presented, goes on the shelf and is never seen again. People’s confidence that we can deliver the things we promise has been dented. By demonstrating that this partnership could exist between government locally and nationally would go a long way to getting the business buy-in, which is crucial to the regeneration of our city centre and high streets.
I also want to pitch to the Minister that certain powers come with that. We have brownfield sites across the city in our three constituencies that are ripe for development. But they are owned by people who have no interest in my city. They are often passed through different shell companies and corporations, because they are an asset that is traded, as opposed to being an asset of value to the city. Being able to access compulsory purchase arrangements that Homes England has for land consolidation, would mean we could parcel up those bigger sites for development.
That would allow us to develop city-centre living, for which there is a demand. The Clayworks development in the middle of Hanley has been so successful it has had a 90% occupancy rate from its first day of opening, which is completely unprecedented in the city. It is high-quality, affordable housing for young and aspiring professionals in a trendy setting. More of that in our city centre would bring people who have a disposable pound in their pocket to come and live, shop and work there. We also have two fabulous universities, which are clearly desperate to take some of the work they are doing to attract people to north Staffordshire to give them a night-time economy offer.
Some of the work, which the Minister is aware of, that we wish to do in the city centre links not only to the day-time retail offer, but to how we can turn our city centres into a night-time economy that people want to come and visit. That would support our restaurants, bars and wonderful theatres across the conurbation, and also links to the policing work so that people feel safe at night.
I welcome the work that the Government have already laid out. That includes the additional community policing that we will have in the town centres, which will absolutely reduce some of the latent antisocial behaviour and crime and is a deterrent, as well as the work we are doing on devolving bus powers so that we can have an integrated transport network to get people to where they need to be. I welcome the fact that this Government recognise that high street theft from shops—shoplifting—is a real problem. We will take it seriously and remove the arbitrary cap of £200, so that, if someone commits a crime in the city centre, we will come for them.
I also welcome the investment in drug and alcohol services, so that those in our town centres who are desperately seeking support from the very generous people of my city can get that support in a much more structured and maintained way. We must also make sure that our really ambitious housing targets are achieved in our town centres, so that we can bring people back to our town centres, invigorate them and bring them back to life, and also demonstrate—as we look toward the next 100 years of Stoke-on-Trent, in this, our centenary year—that we have a bright and prosperous future, driven by a partnership between the Stoke-on-Trent city council and this Labour Government.
The Minister for Housing and Planning (Matthew Pennycook)
It is an absolute pleasure to see you in the Chair, Mr Turner, as well as the reassuring presence of Mr Dowd at your side, stewarding the debate along. I thank my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) for securing this very important debate in Stoke-on-Trent’s centenary year.
My hon. Friend is a doughty champion for his constituency. Although the city, as he rightly said, has experienced hard times over recent years, his constituents should know that, from the outset of this Government coming into office, he has been pressing me on what more this Labour Government can do, in partnership with local leaders and my hon. Friends, to ensure that we maximise the opportunities in the city as we go forward. I share his passion to support the regeneration of the town centres of Stoke-on-Trent and to create better places to live, work and play across the city.
My hon. Friend referenced the meeting we had just a few weeks ago, alongside members of the council, to discuss their plans for a comprehensive regeneration of Stoke-on-Trent city centre. It was clear from that meeting that they are keen to make sure that the city plays a full role in delivering on the Government’s growth strategy, including delivering on a substantial number of new homes, as part of our Plan for Change milestone to build 1.5 million new homes in this Parliament.
Stoke-on-Trent city centre is facing the same problems as many town centres across the country: lower occupancy rates and footfall due to consumer habits changing, which make a retail, office-led city centre strategy difficult for the future. I have been pleased to see, in the case of Stoke-on-Trent—as well as other cities across the country where Labour Members and Labour local leaders are in place—that the new Labour-run city council, under the leadership of Councillor Jane Ashworth, has brought forward a committed and energetic programme and a serious plan for Hanley to take things forward, which will see a radical shift to a residential-led model, aiming to create a revitalised city centre that can play a strengthened socioeconomic role and unlock the development of thousands of new homes, through the process that we discussed.
It has been good to see that so much of the regeneration in Stoke-on-Trent is already well under way. My hon. Friend has referenced a number of the very positive changes that are taking place, including the Smithfield Quarter, a fantastic mixed-use development that pays homage to the original Smithfield bottle works on the site and is an excellent example of intertwining cultural heritage while also looking to the future needs of the city.
The Government have supported this vital regeneration work through Homes England, which has been working successfully with the council for many years. In 2022, a partnership agreement was signed with the council to accelerate the delivery of high-quality, place-making, housing-led and mixed-use developments in the city. The partnership aims to unlock, as my hon. Friend is aware, 4,000 homes across a range of sites within the city, and has to date supported 607 homes across several sites.
The city has also been in receipt of considerable capital investment from Homes England over recent years, including £22 million of affordable housing programme investment and £10 million of housing infrastructure grant investment to unlock a combined 1,500 homes. Through that partnership, significant strides have been made to progress 13 priority sites in the council’s pipeline, and support the council’s local plan review.
Homes England has also provided around £800,000 in revenue funding to support the delivery of priority sites. As my hon. Friend will be aware, some of the key interventions that have taken place include: Homes England acting in collaboration with the city council, procuring and jointly leading the production of a city centre masterplan, providing a connected vision for Stoke and Hanley; and a serious delivery plan—I think that is the point—with clear evidence steps for the development of that key strategic corridor.
We have also seen progress on several flagship sites across the city, providing a catalyst for the regeneration that needs to happen and that I know my hon. Friend is working hard to see delivered. Etruscan Square, for example, is a major city centre development to regenerate the former bus station site in Hanley, which has secured outline planning permission for a 300-home mixed-used development, following on from receiving £20 million of Government funding in 2021. The North Shelton opportunity area is a collection of three brownfield sites; through our brownfield land release fund, the council has been rewarded money to remediate the site and make way for up to 50 homes.
To reiterate the point that my hon. Friend made, we need to see that partnership working continue. I urge local leaders to continue to press forward with that ambition across the whole city, and I have impressed on Homes England the need to continue supporting Stoke-on-Trent with the necessary skills, powers and investment needed to bring forward development, including on known complex brownfield sites in Hanley town centre, at the nearest possible opportunity. As my hon. Friend knows, I am committed to working with him and others to ensure that we are utilising all the powers that are already available, or that the Government intend to bring forward, to ensure that we realise the full potential of the city, including powers in relation to compulsory purchase orders, as was referenced.
Despite the previous Administration making a number of unfunded commitments to local authorities and mayoral combined authorities, at October’s Budget this Government confirmed that the majority of local growth projects have been protected, and that the UK shared prosperity fund has been extended for another year, providing much needed certainty for places to deliver locally. My hon. Friend will also be aware that Stoke-on-Trent received £56 million towards key regeneration sites across the city through the levelling-up fund, supporting both housing and broader economic development.
Gareth Snell
On the point about funding, we got £8 million in the recovery fund, and I am reliably informed by the Minister’s Department that this was the second largest recovery fund settlement anywhere in the country. I thank the Department for that, because it is a huge recognition of the financial challenges we have had in the past and a down payment on what I hope and believe to be the interest that the Department will take in Stoke-on-Trent going forward.
Matthew Pennycook
I will pass on my hon. Friend’s appreciation to ministerial colleagues in the Department who oversaw that decision. He can take as given that the funding awarded is a recognition of the importance we place on revitalising cities such as Stoke-on-Trent.
The Goods Yard is another great example of creating new city centre living opportunities, with new apartments alongside work and leisure spaces and next to the main train station. I look forward to overseeing the opening of that in the coming months. More recently, £6.5 million of additional Government funding has been agreed to support public realm regeneration in Tunstall, Longton, Stoke, Burslem, and Middleport, as part of Stoke-on-Trent’s levelling up partnership. In Tunstall, I have been heartened to see the planned artworks to celebrate the town’s heritage and brighten up the area.
I will touch briefly on planning reforms. As hon. Members will be aware, the Government consulted on changes to national planning policy, and other changes to the planning system, last year. Having reviewed the available evidence and feedback from the consultation, we published our formal response and a revised national planning policy framework on 12 December.
The revised NPPF supports the role of high streets and town centres, by expecting local plans to create a positive framework for their growth and adaptation. It also expects planning applications for town centre uses—defined as retail, development, leisure, entertainment and more intensive sport and recreation uses, as well as offices, arts, culture and tourism development—to be located in town centres where possible, to support their viability and inhibit trade from being drawn to other locations.
The planning and infrastructure Bill, which will be forthcoming later this year, will speed up and streamline the planning process to build more homes of all tenures and accelerate the delivery of major infrastructure projects, aligning with our industrial, energy and transport strategies. The Bill will make improvements at a local level, modernising planning committees and increasing local planning authorities’ capacity to deliver the type of interventions that I have referenced today and deliver an improved service. It will also support more effective land assembly for development in the public interest by reforming the compulsory purchase process. I know that in many parts of the country—Stoke is a great example of this—fragmented and complex land ownership can be a real barrier to development.
Gareth Snell
What the Minister has just said is music to my ears, because this is not just about compiling the land that we know is available for development; it is about the consequential impact of that. If we can bring that land together in Stoke-on-Trent, we will be able to protect our greenfield sites from unnecessary development. The more we can do to put houses in Hanley, the greater our chances are of protecting Berryhill Fields, in the middle of my constituency, which are the green lungs of north Staffordshire.
Matthew Pennycook
My hon. Friend is absolutely right. This Government have a brownfield-first approach to development. In all instances where it is possible, we want to see brownfield development prioritised and accelerated, and we are making a number of changes to ensure that is the case. These include not only some of the revisions we made to the NPPF, but the proposals that we have outlined in our brownfield passport working paper, which will feed into the development of national development management policies, which we will consult on later this year. All of these interventions are to ensure that, wherever possible, we can get brownfield-led development.
My hon. Friend is absolutely right that in many parts of the country that fragmented ownership of land is a real barrier. We want generally to see more coherent land assembly and master planning of large sites to ensure that we can maximise their potential, not least in terms of density and getting the number of homes we need on site. In that way, in many parts of the country, it will be possible to avoid having to look at green belt release, although we are clear that where green belt does need to be released—and grey belt as a priority release within that—that does need to take place to meet local housing targets.
To conclude, I again thank my hon. Friend for bringing this important debate to the House today and for his ongoing engagement. I would like to assure him and the city council that the Government recognise the vital role that Stoke-on-Trent will play in our growth mission. We want to see councils across the country working in collaboration and partnership with the Government to create a sustainable and suitable housing supply for those who live in and commute to town and city centres. I very much look forward to working with him and my hon. Friends to that end.
Question put and agreed to.
Women’s Changed State Pension Age: Compensation
(3 days, 7 hours ago)
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Dr Andrew Murrison (in the Chair)
We are massively oversubscribed. It is plain that we are not going to get everybody in. I remind those who wish to speak that they should bob. I also ask that, voluntarily, Members restrain themselves to two minutes. If we do that, we will get most people in, but not everybody.
Sir John Hayes (South Holland and The Deepings) (Con)
I beg to move,
That this House has considered compensation for women affected by changes to the State Pension age.
It is a pleasure to be able to speak in this Chamber and, as I often do, to draw a very substantial crowd. The genesis of betrayal is trust—the kind of trust that underpins the democratic legitimacy of Parliament and on which the authority of the Executive is founded, and the kind of trust that our constituents, when they send us to this place to exercise our judgment on their behalf, rely upon. Their faith in us is that we will honour what we say we will do and that when we make pledges, they are not empty pledges but are meaningful. When trust is breached and broken, the whole of that legitimacy is undermined.
That is precisely what has happened in the case of the so-called WASPI women—the Women Against State Pension Inequality Campaign. I will use the acronym, because it has become a familiar one to any of us who have taken an interest in this matter, as I have over some time, and as have the public. This campaign is a campaign for no less than justice, to restore trust.
Wendy Chamberlain (North East Fife) (LD)
The right hon. Member is speaking eloquently about trust. Does he agree that it is really important for the Government to help us to have trust in institutions such as the Parliamentary and Health Service Ombudsman by adhering to decisions made by it?
Sir John Hayes
Although that intervention was not orchestrated by me or choreographed by either of us, it leads me neatly to my next point, because there is an ethical case to be made of the kind the hon. Lady describes, there is a constitutional case to be made, and there is a practical case to be made. In the short time available to me—I know that many others want to contribute to the debate—I will try to make all three.
First, the ethical case is, exactly as the hon. Lady said, about honouring the pledges that were made and fulfilling rightful expectations. Not all expectations and hopes are well founded, but when people have worked all their lives and been told that at the end of their working life, they will be paid a pension at a particular time, it is not unreasonable for them to believe that that will come to pass.
Seamus Logan (Aberdeenshire North and Moray East) (SNP)
Given that the Government response to the Parliamentary and Health Service Ombudsman report said that a compensation scheme would be “impractical”, with “significant challenges” and the potential for “unjustified payments”, and that there were significant concerns about the robustness of the Department for Work and Pensions research in 2006, does the right hon. Gentleman agree that the Government’s position is untenable, given the stark contrast with the way that sub-postmasters were treated?
Sir John Hayes
I do agree, and the hon. Gentleman will not be surprised to know that I shall be speaking later in my remarks about the ombudsman’s report and findings, which will bring me to the constitutional matter I raised about the nature of accountability and scrutiny and how Governments are held to account, and whether ombudsmen are meaningful at all if their conclusions are entirely disregarded. He is right to raise that issue.
I want briefly to describe the events that provoked me to challenge the previous Government on this issue when my party held the reins of power. I am not a recent convert to this cause; I made the same argument then—that we needed to recognise the justice of this campaign and act accordingly—but I did so knowing the events that have occurred.
I will not go over things laboriously—because you would not want me to, Dr Murrison, given the number of Members who want to speak in this debate—but essentially, when pension ages were equalised, which was the result of two Acts of Parliament, the notice given to the people affected was inadequate.
I am not an unbridled advocate of the case that every woman who thought that they were going to retire at 60, and then found that they would have to retire at 65, should be compensated. If a woman was young or middle-aged when that happened, there is a fair case that they had time to adjust—they could re-prepare; they could make different plans.
However, if a woman was born in the 1950s and had anticipated retiring in two, three or four years’ time but then had to work up to five years’ longer, it is a very different matter, because many of those women, anticipating their retirement, had prepared for exactly that eventuality. Many of those women, of course, were no longer working. They had ended work to look after elderly parents; they were playing a caring role; or their skills were no longer relevant to the workplace, because they had taken time out of work, first to have children and then, as I have said, to embark on other social responsibilities. These were women who worked hard and had done the right thing, and they are not all, as they are sometimes characterised by their critics, drawn from the liberal bourgeoisie—who, as you know, Dr Murrison, I generally speaking despise.
Sir John Hayes
Having said that, I am happy to give way to the hon. Gentleman. [Laughter.]
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
The words “liberal bourgeoisie” made me think. I represent the mainland constituency that is furthest away from Westminster, and I will just point out that this issue affects women from all over the UK, be they “liberal bourgeoisie” or not. In my constituency—that far away—370 people have signed the petition. This issue is huge all over the UK.
Sir John Hayes
I meant no slight on the hon. Gentleman. He is right: it does affect women across the whole of the kingdom—and of course, he is much posher than bourgeois, so he could not be slighted by my remark.
Susan Murray (Mid Dunbartonshire) (LD)
I rise to speak as a WASPI woman myself, and I am very proud to associate myself with this campaign. I know that many people feel that perhaps we should perhaps not be entitled to compensation, because we were able to get mortgages and buy our own homes, we were able to generate more capital wealth, and many of us have private pensions. However, I personally had to stop work because my husband became ill, and I was looking forward to a retirement where my only income would have been the state pension. I am very thankful for my health; I knew that the retirement age had gone up, and when the right hon. Gentleman talks about skills and abilities—
Susan Murray
I am sorry, Dr Murrison.
I was able to use my skills and abilities to become a councillor in 2022, and I am now looking forward to a much better retirement. However, does the right hon. Gentleman agree that the Government should do a U-turn and implement the ombudsman’s recommendation?
Sir John Hayes
The hon. Lady’s intervention, though not pithy, was pertinent, because she is one of the 3.8 million women, of all kinds and types, who were affected. Many were not well-off; many did all kinds of jobs that could not be described as highly paid; and many found themselves in a position of financial hardship. That is why I stand here today—because this injustice affects all kinds of women, and it has been mischaracterised by some who do not want to face that fact. That makes me angry and righteously indignant, as I always am in the cause of the disadvantaged.
Carla Lockhart (Upper Bann) (DUP)
I thank the right hon. Gentleman for giving way; he is being very kind in doing so. In Upper Bann and indeed across Northern Ireland, thousands of women feel absolutely betrayed by this Government. Does he agree that those women are in financial hardship today because of that betrayal? It is morally indefensible that not a penny has been made available to these women.
Sir John Hayes
Yes, I agree. Some women were forced to carry on working, even when—as an earlier intervention suggested—they were not really in a position to do so, even when they had extra responsibilities, and even when they were not really fit to do so. That is just not acceptable. It is not right; it is not just.
Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
I note the right hon. Gentleman’s righteous indignation, but I question where it was in 2016, when the SNP tabled a motion in support of the WASPI women and he voted against it. Is he not really just a Johnny-come-lately, despite what he said earlier in his speech?
Sir John Hayes
I have been in this place a long time, as the hon. Lady knows, and she is here having first been endorsed by the electorate, then rejected, then re-endorsed. I have not had that difficulty myself; none the less, she will know that one learns and grows in this place. As I became more familiar with these arguments—I repeat this—I challenged the Conservative Government, my own party, on this issue, on the record, on the Floor of the House. It is not about this Minister; this is about any Minister who fails to recognise this matter.
Sir John Hayes
If I might make a little progress, then I will happily give way.
It is important to set out some of the detail. Some of the worst-affected women received just 18 months’ notice of a six-year increase in their state pension age. Just under 2 million women fall into that category. The WASPI campaigners acknowledge that some were going to retire only a matter of days, or perhaps weeks, later than expected, whereas those who were given very long notice were clearly in a rather different circumstance. The campaigners are not unrealistic about that. Having met them and discussed it, I know that they are very realistic about the difference between those two groups, and they therefore simultaneously recognise that the Government response needs to be tailored, and measured in the way it gauges the responsibility. The breach in trust is common, but the effect of that breach in trust is different in different cases.
I do not advocate a response to this problem in which every single case is dealt with individually, so that there are as many different settlements as individuals. That would be impractical and delayed, and I emphasise delay because one of these women dies every 12 minutes. There will be another WASPI woman lost during the course of my speech. That is the reality. These bald statistics mask lives—lives altered, lives damaged and lives restricted by this matter.
Sir John Hayes
That is what inspires me to speak today and, I am sure, inspires the hon. Gentleman, who is about to intervene to say just how much he supports me.
Warinder Juss
A lot of us have previously publicly supported the WASPI women, including by posting photographs on social media. The Government have acknowledged that there has been maladministration, but to have that acknowledgement without some kind of financial backing, even if minimal, not only undermines the process of the ombudsman, who so many of us rely on, but may undermine public confidence in politicians in general.
Sir John Hayes
The hon. Gentleman is right and he encourages me to turn to the ombudsman’s report, which I have before me. Members will be pleased to note that, although I have inserted many tags into my copy of this report and the previous one, I will not refer to all of them. That would take forever.
Suffice it to say that the ombudsman found
“maladministration in DWP’s communication about the 1995 Pensions Act resulted in complainants losing opportunities to make informed decisions about some things and to do some things differently, and diminished their sense of personal autonomy and financial control.”
The ombudsman’s remedy is set out at the end of the second report. Ombudsmen recommend recompense on a scale—a series of levels, from 1 to 6. The report is here for everyone who has not studied it in detail to see: the ombudsman recommended a level 4 response. That means
“a significant and/or lasting injustice that has, to some extent, affected someone’s ability to live a relatively normal life.”
It suggests that the recompense might be between £1,000 and £2,950.
Manuela Perteghella (Stratford-on-Avon) (LD)
Will the right hon. Gentleman give way?
Sir John Hayes
I will in a second.
That suggestion seems to me to be a pretty modest response. It is not extreme, extravagant, unrealistic or unreasonable. It is a modest, measured response borne of the fact that the ombudsman has found maladministration. I have read the two reports. Having been in this House for a long time, been on the Front Bench of my party for 19 years and been a Minister in many Departments, I have rarely seen an ombudsman’s report as clear as this one about maladministration by a Government Department. On that note, I give way.
Manuela Perteghella
I thank the right hon. Member for giving way. Does he agree that rejecting the ombudsman’s recommendations for the compensation of WASPI women undermines the role of independent bodies in holding the Government to account? If we cannot rely on the Government to implement such findings, what message does that send to the public about justice and fairness?
Sir John Hayes
That brings me to the constitutional point that I said I would make. I have established an ethical case, but there is a constitutional issue about the ombudsman. Over the years, we have developed a number of ways of holding the Executive to account. Parliament does that, of course, but there needs to be other means of doing so on particular and specific issues. That is why the Select Committee system emerged: as a way of studying what the Government were doing and making recommendations accordingly. That is also how ombudsmen began. They are an additional mechanism through which Government can be held to account, but for Select Committees and ombudsmen to have meaning, they must have teeth.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
My right hon. Friend is making a very powerful case. Does he agree that this also undermines our roles as Members of Parliament? As a Member of Parliament, I supported the referral of this case to the ombudsman. Does it undermine our roles if when the report comes back it is just dismissed?
Sir John Hayes
Yes. My right hon. Friend is a refined Member of this House. To make a more refined argument in tune with his, I should say that the ombudsman’s report is, as he suggests, to Parliament. It is for Parliament to discuss, debate and make a decision on. The ombudsman’s report is about Government, but it is, exactly as he describes, to Parliament. I am grateful to him for refining my argument in that way.
Mr Mark Francois (Rayleigh and Wickford) (Con)
I can confirm that my right hon. Friend has campaigned on this issue for a number of years, and not just today. He will know that in July 2022, the Prime Minister—then the Leader of the Opposition—responded to Carol, a WASPI woman who rang BBC Merseyside to raise this issue. The Prime Minister said:
“It’s a real injustice, and we need to do something about it”.
What does my right hon. Friend think he meant by that?
Sir John Hayes
Well, it is not for me to second-guess the sentiments of the Prime Minister, but my right hon. Friend is certainly right to say that a number of promises and comments were made. I will talk about them in a little more detail, provoked by his very helpful intervention.
I see in the Chamber today the former shadow Chancellor of the Exchequer, the right hon. Member for Hayes and Harlington (John McDonnell). He will know that the Labour manifesto in 2019 was fulsome in its support for the WASPI women, promising a generous financial settlement. It is perfectly reasonable to say that parties move on; the new Leader of the Opposition, now the Prime Minister, may have taken a rather different view. He may have taken the opposite view.
Sir John Hayes
I will just make this point, and then I will happily give way.
But that was certainly not the impression given by the current Prime Minister’s remarks. He said:
“Justice to end historic injustice”—
that was specifically about WASPI women. The now Deputy Prime Minister said that the Government “stole” the pensions of WASPI women and that Labour would compensate them. Therefore, one can understand why the women, some of whom are represented here today—they are being incredibly diligent and quiet, Dr Murrison, you will be pleased to know—feel that this was indeed a “betrayal”, to use the word that I used at the beginning of my remarks. An expectation was established, and then it was blighted by the decision made since the general election.
Dr Opher
I thank the right hon. Member for giving way. Could I make an appeal to all of us? I do not think that either side of this debate has covered itself in glory. I agree that this is a very dangerous precedent about the ombudsman, but let us not make this party political, please. Let us make this about the WASPI women. Is there not a way, at least, of compensating the very worst off among the WASPI women? I would appeal for that.
Sir John Hayes
That is a measured intervention, and I thank the hon. Gentleman for it. It is true that a package could be put together and discussed with the campaign group and the women concerned; one would expect Government to do that. As a Minister, I would have had submissions. I have no doubt that this Minister has had them, and the Secretary of State must have had submissions that gave her options, before she said what she said when she let the WASPI women down. Those options would no doubt have included a series of ways through this. I know the Minister will be eager to explore those options with us when he sums up the debate. I have no doubt about that because he is a diligent and decent man; he will not want to betray those women again in what he says today because he is not that kind of character.
Mike Wood (Kingswinford and South Staffordshire) (Con)
The Government’s position appears to be that they accept that the failures between 2005 and 2007 constitute maladministration. All of us can see in our inboxes the number of women who, as result of decisions taken on the basis of that failure, suffered as a result. But the Government’s position seems to be that there should be no remedy because it would be too difficult to get it right. What kind of justice is that?
Sir John Hayes
There are several arguments used by those who do not want to get it right, to use my hon. Friend’s term. One is that the public do not care, although all the survey evidence suggests the opposite: that 75% of people think that WASPI women should be treated fairly. Another argument is that it will be too expensive. I could make all kinds of rather spiteful remarks about the Government’s decisions about public sector pay, but I will let them stand as a contradiction, without adding to them.
Ayoub Khan (Birmingham Perry Barr) (Ind)
I thank the right hon. Member for giving way. He makes a very eloquent and persuasive statement. The current Government use compensation as an excuse, saying it is too expensive, but we have seen, for example, train drivers being given an additional £600 a day. We have seen Government intervene on the Post Office scandal. Does the right hon. Member agree that the argument can be easily disabused by looking at the track record on assistance for those who have found themselves at the forefront of injustice?
Sir John Hayes
I had alluded a moment ago to the choices that Government make about how they spend money. Of course it is true that Government priorities will determine where money is spent. The issue is clearly not a priority for the Government. It is difficult, of course: Governments face all sorts of challenges that require investment, and this Government have chosen not to invest in this area. Frankly, it is as plain as that.
Sorcha Eastwood (Lagan Valley) (Alliance)
Will the right hon. Member give way?
Sir John Hayes
With respect, I am going to conclude because I know so many want to speak; I do apologise. [Interruption.] All right, I will briefly give way, but it is the last time.
Sorcha Eastwood
I am so grateful to the right hon. Member for giving way and indulging me. I simply want to add to his conclusion. These women have been part of a generation of women who have been discriminated against by statutory provisions over their lifetimes—whether by the reprehensible marriage bar, the gender pay gap or now this. I am sure the right hon. Gentleman would agree. [Applause.]
Sir John Hayes
I am grateful to the hon. Lady; I am slightly jealous that I have not managed to attract any kind of applause, but no doubt that will come at the end of my peroration. The hon. Lady is right: that generation of women, born after the war, did not have straightforward lives. That was a difficult time in this country, particularly for women. I talked earlier about their hard work and diligence, and their role as homemakers, mothers and grandmothers. They just deserve better; that is what has driven and inspired me to bring this debate.
I will end on this note. The Minister will not be surprised to hear that I am mindful of the words of Edmund Burke, who said:
“Your representative owes you not only his industry, but his judgement”.
In the end, this is a matter of judgment. Do we think the issue matters or do we not? Exercising judgment, I leave him with this further quote, from J.R.R. Tolkien:
“False hopes are more dangerous than fears”.
We gave these people false hope. I fear that we will not now put this matter right by realising the rightful hope that they had in thinking they were going to retire at a certain time but then ended up doing so at an entirely different time due to a change of Government policy. That was because of nothing they did, nothing they changed, nothing they chose; it was a change in the law.
I hope that when the Minister sums up he will recognise the strength of feeling across the House, and across this country: that this injustice must be put right, in the name of democratic legitimacy and the trust that I set out at the beginning of my peroration.
Rebecca Long Bailey (Salford) (Ind)
It is a pleasure to serve under your chairmanship, Dr Murrison. It is a pleasure to follow the right hon. Member for South Holland and The Deepings (Sir John Hayes), who—as I know from working with him on other campaigns—is quite the social justice warrior, contrary to popular belief. I fully align myself with the comments he has made. I also welcome the new Minister to his position. We have high hopes for him in this place.
When the ombudsman finally confirmed last year that the Department for Work and Pensions was guilty of maladministration, that these woman had suffered injustice and that they were entitled to compensation, we thought that was it—case closed; the next step would be what a redress mechanism would look like. Of course, many felt that the ombudsman’s report had not gone far enough, but we had the firm expectancy that the previous Government, and later this one, would at the very least act on the ombudsman’s recommendations, as would be the usual course of action.
So when the Government finally issued their response, it was met with shock—shock that despite the clear findings of state-level injustice, these women were to be denied justice; shock that the ombudsman’s findings that too many people did not understand their own situations was ignored by the Government; and shock that while, on the one hand, maladministration was accepted, the recommendations of the ombudsman were rejected in full, without alternative proposals being set out or there being an opportunity to vote or debate the matter in Parliament, as the ombudsman intimated.
There were also fears, as colleagues have stated, that a precedent might now be set on observing an ombudsman’s proposals. Usually, when a state-level injustice is found, a Government of the time will act on an ombudsman’s proposals or outline their own alternative ones.
Anna Sabine (Frome and East Somerset) (LD)
The work the Government are doing to improve transparency and accountability contrasts with what happened under the previous Administration, but does the hon. Lady agree that if they ignore an independent ombudsman’s report, it just looks like more of the same to people in my constituency?
Rebecca Long Bailey
It is incredibly worrying.
I do not want to test your patience, Dr Murrison, so I will draw my comments to a close by saying this to the Minister. He must be aware that the ombudsman made the rare choice to lay this report before Parliament because it was not reassured that the Department for Work and Pensions would act on its recommendations, and it was right to have that fear. The Minister must understand that although many of us in this place wholeheartedly welcome the Government’s apology to the impacted women and acknowledge the difficult financial landscape the Government find themselves in, state-level injustice is state-level injustice. It cannot be ignored, and an apology alone is not sufficient. A remedy must be forthcoming to address the clear and apparent injustice that these women have faced.
Sir Julian Lewis (New Forest East) (Con)
At a rough count, there are in excess of 50 colleagues here from a range of parties. I hope every one of them pledges to join the all-party parliamentary group on state pension inequality for women, ably led by the hon. Member for Salford (Rebecca Long Bailey).
This boils down to a question of credibility and respect. What credibility and respect can there be for ombudsmen’s reports if they are ignored? What credibility and respect can there be for Members of Parliament, ranging from the now Prime Minister to foot soldiers such as me, who parade with placards saying we will fight and campaign on behalf of the WASPI women, if we do not follow through on those commitments?
I want to raise one particular point that bothers me, and then I will let others continue the debate. In trying to justify their policy of inaction, the Government seem to be oscillating between two positions: on the one hand, they keep suggesting that they simply cannot afford to give any compensation at all, but in the next breath they seem almost to be challenging the contents of the ombudsman’s report, relying on a dodgy poll that suggests that 90% of the affected women knew about the changes. Well, if the Government can rely on dodgy polls, so can I. I happen to be married to a WASPI woman, and on a dodgy poll of one I can tell the Government that she did not know and did not get a letter, and she has no particular motivation for claiming otherwise, given that it would not have affected her career choices. The Minister needs to be clear when he sums up: do the Government accept that there was maladministration, as the report sets out, or are they trying to deny that fact?
In paragraph 20 of the report, the ombudsman says:
“While it is unusual for organisations we investigate not to accept and act on our recommendations, we have no powers to compel them to comply. When an organisation does not comply with our recommendations, we can lay a report before Parliament so that Parliament can act to protect citizens’ rights.”
That is what the ombudsman expects, and that is what the WASPI women have every right to expect too.
Several hon. Members rose—
Dr Andrew Murrison (in the Chair)
Order. Colleagues will have done the maths. Not everybody is going to get in. I am reluctant to introduce a formal time limit, but you really ought to limit yourselves to two minutes, please. I am sure John McDonnell will be an exemplar.
John McDonnell (Hayes and Harlington) (Ind)
I certainly will, Dr Murrison. I welcome the Minister to his position. I am so pleased that he has been given such an easy policy to resolve as his first task.
Reference has been made to the 2019 manifesto commitment, so let me briefly set it out:
“Under the Tories, 400,000 pensioners have been pushed into poverty and a generation of women born in the 1950s have had their pension age changed without fair notification. This betrayal left millions of women with no time to make alternative plans—with sometimes devastating personal consequences. Labour recognises this injustice, and will work with these women to design a system of recompense for the losses and insecurity they have suffered.”
We did that on the basis that those women had paid into the system and been given a date to retire, but had not been given adequate notice. As a result, their life plans were changed dramatically and they suffered consequences. We co-produced a scheme that was expensive—I accept that—and that was going to pay out over a five-year period, but it would have meant that we resolved the matter once and for all. We were not elected, and that scheme never went forward.
When I saw the ombudsman’s investigation, I thought that at least something would be done. When the ombudsman’s report came out, I was not satisfied with it, but I thought it was at least something. Not having that implemented has crushed people; it has crushed their confidence in the system. I say to my own party, which is now in government, that we need the Government to sit down with the ’50s WASPI women and, if necessary, to either implement this scheme or mediate for an alternative, but we need action.
I say to the Minister that this issue is not going away. We are not going away. The women are not going away although, tragically, some of them are dying. This campaign will go on until we secure justice.
Iqbal Mohamed (Dewsbury and Batley) (Ind)
It is a pleasure to serve under your chairship, Dr Murrison. I am a new Member, and one of the first emails I received was from a WASPI woman. She followed up with a further email, which—to take as little time as possible—I will read out.
“I need to vent my frustration and anger at the Government’s announcement yesterday that they will not accept the ombudsman’s recommendation to pay WASPI women some compensation for maladministration. They were in support of this whilst they were in opposition.
As my elected MP, please can you make it known that, as a lifelong supporter of the Labour Party, I am totally disgusted by this volte-face.
I am a WASPI woman who fortunately worked for many years as a teacher and therefore have an occupational pension. I have not been campaigning for myself but for the many women who were in low paid jobs or had caring responsibilities and were not in a position to have a private pension and were therefore relying on a state pension from the age of 60. I understand the equalisation of the ages but, as the ombudsman stated, many women were unaware of the increase in age, in my case two increases. I had one letter about it. Even women who knew about it were often not in a position to ‘make appropriate financial adjustments to their planning.’
The people making these decisions are in fortunate positions themselves but I was relying on their understanding and compassion for others who are less able to make up the circa £48,000 which I reckon to have ‘lost’.
The government has let WASPI women down. We are not in a great position to protest about this. I am asking you to make the protest on our behalf please.”
Mrs Emma Lewell-Buck (South Shields) (Lab)
It is a pleasure to serve under your chairmanship, Dr Murrison. I need to say at the outset that my mam is a WASPI woman. Her generation entered into a contract with the state, which the state reneged on and then stole from them.
But this debate is about more than the injustice these women continue to suffer: it is about trust in politicians and our dwindling faith in democracy. I have continually pledged my support to the more than 5,000 women in South Shields who are affected by these changes. These women were as shocked as I was when the Government announced in December that there would be no compensation.
WASPI women do not disagree with compensation for the victims of the contaminated blood scandal, for LGBT veterans and for sub-postmasters, but they do not understand why they are being treated differently. An injustice is an injustice. The PHSO was clear that it is Parliament that needs to make the final decision, yet Parliament has not been allowed to.
I know that deciding on compensation will be complicated and costly, but that is not an excuse. It should not be beyond the realms of any Parliament or Government to figure this out. These women see, as we all do, how the very wealthy and companies profit from our country and do not reinvest in it. Those are the ones who should be paying the price for the economic mess the previous Government left behind, not those who spent their lives contributing. Their fight for fast and fair compensation continues to have my steadfast support, because my words and promises to them, and to the people who sent me to Parliament, matter to me. They put me here, and I will always put them first, because the day I do not, I no longer deserve to be their voice in this place.
Ayoub Khan (Birmingham Perry Barr) (Ind)
I thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for securing this important debate. I will not repeat what so many Members have already said—repetition never makes any argument more persuasive—but the stark fact raised by the right hon. Member is that a WASPI woman dies every 12 minutes, so we will have lost five or six by the time the debate finishes.
As politicians, we have a responsibility and an obligation to act urgently to establish a comprehensive compensation scheme that can be tailored over time. We do not have to raise hundreds of millions of pounds straightaway; that could be done over the lifetime of this Parliament. Such a scheme would recognise the important contribution made by women born in the 1950s, and support the impartial, independent role of the ombudsman, thereby giving it the credence it deserves.
As representatives of the public, we must ensure the principles of transparency, accountability and fair treatment that underpin our democracy. It is time we stood up for this deserving group of women across the country and specifically the hundreds and hundreds from Birmingham Perry Barr who have written to me.
Bell Ribeiro-Addy (Clapham and Brixton Hill) (Lab)
I thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for securing this important debate. I state on record my support and admiration for the WASPI campaign. They have campaigned tirelessly for an acknowledgment of the wrong they face and, crucially, for compensation. I have been pleased to meet many of them on a number of occasions during my time as an MP, and I stand in complete solidarity with them.
The Government have rightly accepted the Parliamentary and Health Service Ombudsman’s findings of maladministration and apologised for the 28-month delay in writing to 1950s-born women, but what good is that apology if there are going to be no steps towards redress? These hard-working women contributed to the economy, raised families, cared for others and contributed to society in countless ways. They planned their lives based on assurances that the state pension would be available at 60. Instead, they have faced financial hardship, uncertainty and, in many cases, significant distress.
As a result of the previous Government’s maladministration, these women have spent the bitter, cold winter rationing their heating because 84% are concerned about soaring energy costs. I know that that reality is faced by people up and down the country, but it is doubly so by WASPI women. What is the cost of failing to address the injustice and leaving thousands of women in financial hardship, without the support they were promised? What is the point of an apology without redress?
Some precedents have been mentioned already for providing compensation where the Government have failed. Those include schemes for Equitable Life investors and for the victims of blood contamination and the Post Office scandal. Even though the scheme was poorly administered, victims of the Windrush scandal have rightfully been awarded compensation for the suffering they endured. Ultimately, the principle has to be the same and has to apply in this case: the Government made a severe mistake, and thousands suffered as a result, so compensation should be paid.
It goes without saying that the mistake was not made by the current Government, and the blame does not lie at their feet, but unfortunately the responsibility for redress does. There is a strong moral imperative for the Government to accept the ombudsman’s recommendation. We have heard during the debate how many WASPI women have died since the campaign began. People voted for a Labour Government that would act in a more compassionate way than their Conservative predecessor, and we still have the opportunity not to let them down.
Helen Maguire (Epsom and Ewell) (LD)
It is pleasure to serve under your chairmanship, Dr Murrison. I congratulate the right hon. Member for South Holland and The Deepings (Sir John Hayes) on securing this important debate.
In Epsom and Ewell alone, 5,420 women have been affected by the changes to the state pension age, and their voices echo the sense of betrayal felt nationwide. These women have been wronged, not just by the failure to properly notify them of significant changes to their pensions, but now by this Government’s refusal to act on the clear recommendations of the Parliamentary and Health Service Ombudsman. The ombudsman concluded that there was maladministration by the Department for Work and Pensions dating back to 2005. It found that delays in communication meant too many women did not understand how the changes would affect them. Despite that, this Government have refused to pay any compensation.
A constituent of mine captured the heartbreak that so many feel. She wrote:
“I am absolutely devastated and I feel betrayed. For years, senior Labour representatives and even the Prime Minister himself pledged to deliver fair compensation to those impacted. They have now made a political choice to break that promise and to ignore the findings of an independent watchdog…The Government failed to properly inform women of the changes, and many were plunged into poverty as a result.”
Many women were blindsided by the changes, left unable to prepare for the financial shock that followed and plunged into hardship through no fault of their own.
I am proud that the Liberal Democrats have long called for justice for these women. We remain steadfast in our belief that the Government have a moral duty to act in line with the ombudsman’s recommendations. The decision to deny compensation sets a dangerous precedent, undermines the role of independent watchdogs and erodes public trust in governance. The Government’s refusal to act on the issue is heartless and short-sighted. These women are asking for fairness, for recognition of the injustice they have suffered and for the means to rebuild their lives. I urge the Government to reconsider their position, listen to the ombudsman and do right by these women. It is time we ended this injustice.
Grahame Morris (Easington) (Lab)
It is a pleasure to serve under your chairmanship, Dr Murrison. I thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for securing the debate, and thank his colleagues from the all-party group.
Many of us believe that the treatment of the WASPI women is profoundly unjust. For over a decade I have stood with local campaigners in my constituency, at rallies and here in Parliament. The merits of their case remain undeniable, and their demand for justice is as compelling as ever. Does the Minister agree that, following the ombudsman’s recommendations, we must begin to address this injustice? When an injustice is identified, we surely have a duty to root it out and make it right.
The Conservative party does not have a “get out of jail free” card on this issue. I was in this Chamber when 75 Members debated this issue—so many that some were sitting on the window ledges—and the DWP Minister, the then hon. Member for Hexham, suggested that women who could not make ends meet could take up apprenticeships and retrain. I do not know whether any Members here today were at that debate, but the Minister had to be escorted out of the Chamber by security and put in a service elevator for his own protection.
Sadly, more than 300,000 WASPI women have died since the campaign began. Given that the ombudsman took the extremely rare step of instructing Parliament to act to ensure that the Government issue compensation and an apology, does the Minister not think it right to settle this injustice?
Ministers in this place set the attitude and tone of public bodies. If it is acceptable for the Government to disregard ombudsman decisions on cost grounds, that sets a dangerous precedent. It tells other financially stretched public bodies to ignore any ombudsman recommendations with cost implications, irrespective of the merits and justice of the case.
Kirsty Blackman (Aberdeen North) (SNP)
Thank you for chairing this debate, Dr Murrison. I thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for securing it and allowing us the opportunity to speak.
It is truly shocking that the Government were willing to apologise, admit that there had been maladministration and then to say, “Sorry, we’re not doing anything about it.” The WASPI women have run one of the best campaigns I have ever seen. Imagine this society and economy without the contribution of the WASPI women. These women were told throughout their careers to be quiet, and were told that they were not as valuable as the men who were working with them. These women quietly got on with the job, raised children, looked after parents and worked incredibly hard for less money than their colleagues. These women put so much in, and made these islands what they are today.
The UK Government are sitting there knowing that they wronged this group of women and are unwilling to do anything about it. What would the Treasury’s coffers look like if they did not have the £200 billion from equalising the state pension age? Imagine what we have asked those women to put up with throughout their time, and this Parliament is saying to them, “You’re still not worth it. You’re still not valuable. You still do not deserve compensation, despite the fact that we’ve wronged you.”
The Government know that they are wrong; they know this is the wrong decision. What they need to do now is put it to a vote on the Floor of the House and give every single MP the opportunity to walk through the Lobbies to make clear their individual views on the actions being taken towards the WASPI women and the principle and administration of compensation. The WASPI women deserve compensation. The Government need to give us a vote.
Dr Andrew Murrison (in the Chair)
Colleagues, the wind-ups will begin at 3.28 pm.
Mr Jonathan Brash (Hartlepool) (Lab)
It is a pleasure to serve under your chairmanship, Dr Murrison. This is a profound injustice, and one that has shaken the lives of countless women born in the 1950s, who are the very backbone of our society. They have endured hardship, anxiety and financial insecurity because of what the parliamentary ombudsman has unequivocally stated was maladministration by the Department for Work and Pensions. It is indisputably an injustice.
I understand and support this Government’s mission to address the mess that was left by what I can describe only as the worst Government in my lifetime. However, the role of a Member of Parliament is not to offer unquestioning subservience to their party. When something is wrong, they have a duty to say so. I cannot and will not abandon these women. As a candidate, I stood beside them, held their banners aloft and pledged my support. I told the WASPI women of Hartlepool that I would always stand by them. That commitment does not and must not end with an election. I will not leverage their support only to walk away once I have their votes.
I count WASPI women as my friends. I pay special tribute to Barbara Crossman and Lynne Taylor, who are in the Public Gallery today, and the countless WASPI women across Hartlepool for their tireless and passionate campaigning. I have supported them for years and am standing with them now. Let us remember what is at stake. This is about not merely compensation, but trust. It is about ensuring that no citizen or generation feels abandoned by the institutions that are meant to protect them. I say to the WASPI women and their supporters that their fight is just, that their voices will not be silenced and that justice delayed is justice denied. Together, we will continue the fight.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
In Wales different groups, including 1950s Women of Wales and WASPI, have been working tirelessly to force Government action on pension inequality over many, many years. Unlike Labour in government, Plaid Cymru’s support for 1950s-born women has not swayed with the tide. We believe it is inexcusable that the Labour Government have refused the recommendation of their own regulator, the Parliamentary and Health Service Ombudsman, to provide compensation, and justified that by saying what we have always heard: that the cost would not
“be a fair or proportionate use of taxpayers’ money.”
Paper justice—justice without compensation or redress —is an insult to a system that bothers to pretend that the ombudsman’s offices can protect the citizen from the incompetence or failures of the state. As things stand, this is not even a tissue of justice. It is particularly unjustifiable because the ombudsman makes clear in its final report that
“finite resources should not be…an excuse for failing to provide a fair remedy.”
The level of compensation set out by the ombudsman does not go far enough in the first place. It does little to account for the impact, both financial and otherwise, on affected 1950s-born women. Plaid Cymru has consistently supported compensation of at least level 5 on the ombudsman scale: between £3,000 and £9,950. These were women whose voices were not heard during their careers. That is the experience of many of them and many of us. It is a shameful thing that with a Labour Government in power, their voices remain unheard. The impact on 1950s women deserves more than a meagre apology.
I am grateful to the right hon. Member South Holland and the Deepings (Sir John Hayes) for securing this debate. We have it in our power to have Opposition day debates—there are 20 in a parliamentary Session—and that would be a means of bringing a vote to the Floor of the House; I urge those parties that have it within their gift to bring forward an Opposition day debate to do so, to hear those voices and to have it recorded.
Lillian Jones (Kilmarnock and Loudoun) (Lab)
I congratulate the right hon. Member for South Holland and the Deepings (Sir John Hayes) on securing this important debate. I have a long record of supporting and have worked closely with the WASPI women, both before and after being elected as their MP. I believed in their cause then, and I still believe in their cause today.
The Government were right to apologise for the delay in writing to the 1950s-born women, and they were right to acknowledge that there are lessons to be learned. Those were important first steps. However, I am very disappointed by the Government’s decision not to fully implement the PHSO recommendation to pay compensation. Let me explain why.
Claiming that most 1950s-born women knew that the state pension age was increasing is not accurate. That statistic is from a 2006 survey that referred to a general awareness across the whole population about future changes to the state pension age. It did not ask whether people knew about the specific impact of state pension age changes on them as individuals, and only around 5% of survey respondents were 1950s-born women.
For many, the abrupt change meant they were left with fewer financial resources, longer working years and, in some cases, significant personal distress, especially for women in low-paid jobs. The financial hardship that WASPI women have experienced is a direct consequence of the pension age increase. The parliamentary ombudsman ruled that the national financial challenges should not be a barrier to awarding compensation.
Although compensating WASPI women may not be an easy administrative task, that is not a reason for avoiding action. Government is difficult, but that is not a valid excuse. I am disappointed that the Government decided not to implement all the recommendations of the parliamentary ombudsman, who laid the report before MPs and handed the role of compensating WASPI women to Parliament. That is why WASPI women are so angry.
Every woman has a right to be able to plan for a dignified and secure retirement. I therefore urge the Government to look again at the ombudsman’s recommendations, do the right thing and ensure that WASPI women get the financial justice that they so deserve.
Jim Shannon (Strangford) (DUP)
On behalf of the 5,000 WASPI women in Strangford, I beseech the Government to take the right decision and make the just decision for them. It is not just an obligation because of the ombudsman; it is a moral obligation as well. I think of all the women who come to see me and feel—I say this with great respect—let down by the Labour Government. One lady said to me, “I’ve been a member of the union all my life and the Labour party have let me down.” I speak for her and all the others.
Steve Darling (Torbay) (LD)
I congratulate the right hon. Member South Holland and the Deepings (Sir John Hayes) on securing this really important debate.
When one reflects on there being more WASPI women in the United Kingdom than the population of Wales, it demonstrates how this is a massive issue for this United Kingdom. In my constituency there are 6,930 WASPI women, and there are a similar number in Newton Abbot over the border. There are 7,400 in South Devon. Yet in the Prime Minister’s constituency there are fewer than 4,000. I smell a rat. I will give credit to those Labour Members who are here but, just as with the winter fuel payments, we can see that sadly certain members of the Government are choosing, because of the arithmetic around pensioners, to make decisions of an ill-advised nature like this.
In her statement on WASPI women, the Secretary of State talked of the fact that the decision was made by a previous Government, and that that was what WASPI women were really concerned about. The reality is—I hope the Minister will address this; other colleagues have raised it—that the report was about the communications and the impact on women. It was not about a previous decision. So that is what the Government should be addressing.
Steff Aquarone (North Norfolk) (LD)
On that point, my constituent Lauraine took early retirement from the NHS in 2014 to care for her husband. She believed that her state pension would kick in in 2015 and support her in her caring responsibilities, since she never received any notification from the DWP to tell her that it would not. She feels angry and let down. Does my hon. Friend agree that it is shocking that the Government can hear testimonies such as Lauraine’s and still refuse the fair compensation that these women deserve?
Steve Darling
Yes, and my hon. Friend also reminds me of Marilyn in my constituency, who suffered a significant illness and would have benefited from compensation—as would Pam, who cared for two terminally-ill family members. I totally agree with my hon. Friend.
What a baptism of fire this is for the new Minister, but we need him to address the real issues. He must not be wilfully blind to the recommendations of the ombudsman. I would also welcome an explanation why an answer to my named day question, which was named yesterday, remains outstanding.
Dr Andrew Murrison (in the Chair)
Commendably brief, if I may say so. I call the Opposition spokesman.
Danny Kruger (East Wiltshire) (Con)
Thank you, Dr Murrison; it is a pleasure and an honour to serve under my constituency neighbour on, I think, your first day in the Chair. I congratulate all Members who have spoken powerfully and eloquently on behalf of their constituents. I also pay tribute to the those in the campaign, many of whom are in the Public Gallery, silent witnesses to our debate—I honour them for their long campaign for justice.
In particular, I congratulate the new Minister, who I am glad to welcome to his place. Today is his first outing as a Minister, and he has quite a job to do to answer this debate. He is, of course, familiar to us from the media as an independent expert, offering ostensibly impartial advice helpful to the Labour party over many years; I am glad to see him in his rightful place at last. I exonerate him, as a new Minister, for this decision: he did not make it, but has been thrown into it by his party and his boss, the Secretary of State. Perhaps he can change the policy, now that he is new to the role and not implicated in it. Perhaps it was a condition of his accepting office that the Government revisit this topic. I very much hope that that is what we will hear from him shortly.
Particular congratulations, likewise, to my right hon. Friend the Member for South Holland and The Deepings (Sir John Hayes). I honour his long campaign on behalf of women born in the 1950s. It is not only because he loves everything from the 1950s that he is taking this position; he is absolutely right in everything that he said.
The complexity of the matter has been well addressed by the ombudsman and by the Members who spoke today, so I will not revisit the issue in any detail; it reflects the work of a series of Governments over 30 years since the 1995 decision to equalise the retirement age. I was glad to see in the ombudsman’s report that the DWP has co-operated fully with his inquiry and I am glad that Ministers and officials respected the ombudsman process.
I am sure this point was made by the Secretary of State in the main Chamber when the decision was announced, but the suggestion that this matter could have been cleared up by the previous Government in consequence of the ombudsman’s report is, I think, a little unfair, given that the report came out only two months before the general election was called. It has taken five months for this Government to make their decision—these things are complex. I respect the challenge that the Government have had. I wish we had had time to address it ourselves, but the voters would not have it. This, of course, is this Government’s decision.
To address the central issue, the ombudsman found that adequate communications were made throughout the period, but that there was a particular maladministration, as Members have repeatedly mentioned: the delay in sending out letters in 2005 to 2007. It is good that the Secretary of State acknowledged that maladministration in her response to the ombudsman—I appreciate that and accept it—and that she apologised on behalf of the then Labour Government and the DWP. The fact is, however, while no direct financial loss may have been caused by the maladministration of communication, with a direct change to people’s incomes, nevertheless, as we have heard so eloquently from Members, the maladministration—the failure to communicate properly—has caused women to make decisions in ignorance of their true circumstances.
Robin Swann (South Antrim) (UUP)
Is the hon. Gentleman surprised that the parliamentary ombudsman issued another report this morning damning the Department for Work and Pensions, which she criticised for
“failing to learn from its mistakes”?
She revealed yet another case, of a pensioner who was not told for eight years about a change to their pension that would leave them £3,000 a year worse off.
Danny Kruger
The hon. Gentleman highlights the central point here: although, as Members have said, the change of policy itself was not the subject of the ombudsman’s inquiry, the failure to communicate directly impacted the circumstances of many women. They did not understand the circumstances they would be in, and it changed the decisions they were making.
Jim Shannon
Does the shadow Minister share with me, and I believe with many in this Chamber, what the good book refers to as righteous anger? There is righteous anger today for those elderly people and women who looked towards their retirement as the end of pain and exhaustion. They were unable to plan financially to enable them to retire earlier due to the nature of the communication they were given by Government. Righteous anger deserves justice. Does he agree that the ladies who I and others in this Chamber represent deserve justice? Whether the Minister is responsible or not, he has to give a justifiable yes to what they want.
Danny Kruger
The hon. Gentleman is absolutely right. I have heard it said that anger is love in the presence of injustice. The righteous anger that so many people feel here in this Chamber and beyond reflects the essential injustice we have seen.
The Government, in their response to the report, made this central defence, which we might hear again from the Minister: they dispute that women were left out of pocket because of the failure of communication made by DWP all those years ago. The Secretary of State argued in the Commons that letters do not have much impact anyway, citing some research suggesting that people ignore letters, do not read them or do not remember receiving them. It begs the question of why Government communicate at all if there is no value to it. It is obviously true that communication of an issue raises awareness of the issue. The failure to communicate meant that awareness of the issue was not possible for these people.
I recognise the challenge faced by the Government here. It is, of course, difficult to assess the precise circumstances of 3.5 million women. I recognise that some of the claims made on behalf of the campaign were exorbitant. Nevertheless, there were many options on the table for the Government to consider, from a hardship fund to smaller packages of support. It was not the only option to give a total no—nothing at all for the WASPI women. That was not the only option.
Melanie Onn
Exactly what is the Conservative policy on WASPI women? I have been a long-standing campaigner for WASPI women, voting for the SNP motion in 2016, which the right hon. Member for South Holland and The Deepings (Sir John Hayes) failed to attend. It is unclear exactly what the shadow Minister is suggesting. Is he suggesting that there is no plan from the Conservatives for what they would do?
Danny Kruger
We do believe there should be justice for the WASPI women. We do believe that an injustice was done and that there should be support offered to them. There needs to be a proper cross-party agreement on this, and I look forward to hearing what the Government have to say on it. We were examining the report ourselves when we were sadly removed from office, when the hon. Lady returned to the House, and I am sure that my party would have come forward with a much better package of support than the Government have—because that would not be difficult, would it?
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
The hon. Gentleman made an interesting point about individuals having the information to plan for their future. Could he therefore comment on why, under 14 years of his party’s control of the Department for Work and Pensions, one of the major platforms of its work, the pensions dashboard programme, had to be reset? The costs associated with it increased 23% because it basically went off the rails under his Government’s leadership.
Danny Kruger
Well, I am afraid to say that often there is maladministration in benefits and welfare, which is the consequence of this vast system that we have. I apologise on behalf of the previous Government if mistakes were made. However, the point is that under the previous Government significant increases were made in both pensions and benefits for pensioners. The state pension rose by nearly £4,000 under the last Government, with an increase of nearly 9% in the last year alone, so I am proud of our record on supporting pensioners.
On behalf of the WASPI women and particularly the campaigners, I would like to reflect their intense disappointment, because the fact is that hope was held out to them by Labour when Labour was in Opposition, including by the now Prime Minister, the now Chancellor and the now Secretary of State for Work and Pensions. Who knows? Maybe even the Minister who is here today held out such hope when he was campaigning. Many people voted Labour at the election last year because they believed that justice would be done for the WASPI women, because that is what Labour candidates said would happen. The broken trust that my right hon. Friend the Member for South Holland and The Deepings so eloquently referred to is very real.
I would like the Minister to explain why this decision was made, because there was no specific explanation by the Secretary of State when she announced the decision. Was it because the Government could not afford compensation? Was it because of their newly discovered problems with the economy when they arrived in office? If so, could they not afford anything? Nothing? No package at all could be afforded—not even a small one? Or was it because they thought that it was wrong and unfair to compensate the WASPI women, even if it was affordable? If they did think that the WASPI women are owed some money, there can be no question about paying it. Justice demands it; it must be paid. Something else must give way.
I end by making a political point, I am afraid. The fact is that this Government have made a decision not to compensate the WASPI women because they are making payments in all sorts of other directions. There are a lot of discretionary payments being announced by this Government. They have made huge salary increases to train drivers without any reforms to their productivity, they have created an energy company costing billions of pounds that does not make any energy and, most recently, they are paying a foreign country to take off our hands a UK sovereign territory that is vital to the defence of the UK. There are discretionary payments available and it would be interesting to know why on earth they have not made this one. They did not have to act in that way, and I look forward to the Minister justifying why the decision was made and saying what he will do to bring justice for these women.
The Parliamentary Secretary to the Treasury (Torsten Bell)
It is a pleasure to serve under you today, Dr Murrison.
I thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for securing a debate on this important topic. I also thank him, if slightly less enthusiastically, for its timing, which is on my first day in office. That fact also explains the delay in answering the named day question put by the hon. Member for Torbay (Steve Darling), which he referred to in his contribution to the debate.
I am under no illusion that everyone in this Chamber, or almost everyone in this Chamber, will agree with everything that I am about to say. However, all of us who have listened to this debate and to the important points made by right hon. and hon. Members have benefited from it, and we all recognise the context of this debate, which is the squeeze on living standards that has affected women born in the 1950s just as it has the entire country.
The issues that we are discussing today are important to many women, including my aunt in west Wales, who was born in 1955 and who pays particularly close attention to these issues. I spoke to her last night as part of my preparation for this debate and she would agree with the points made by the hon. Member for Lagan Valley (Sorcha Eastwood), and by my hon. Friend the Member for Clapham and Brixton Hill (Bell Ribeiro-Addy), that women of her generation have faced many difficulties and particular discrimination. People have spoken powerfully about that.
It is therefore right that this debate gives the long-held concerns of those women the consideration they deserve, just as it was right that the Government considered those concerns in making the decision that we are debating today. That is also why my predecessor, my hon. Friend the Member for Hampstead and Highgate (Tulip Siddiq), was the first Minister in eight years to meet WASPI Ltd, why the Government considered the ombudsman’s investigations and reports in detail, and why we look closely at what Parliament has said on this subject. Although I understand that the outcome was disappointing for many, the decision was based on the evidence.
Before I set out how we reached that decision, as the hon. Member for East Wiltshire (Danny Kruger) requested, it is worth reiterating the point that several Members have made: the ombudsman’s report was not about the decision in 1995 to increase the state pension age for women, or the decision in 2011 to accelerate that increase. Those decisions were the focus of remarks by many Members, including my hon. Friend the Member for South Shields (Mrs Lewell-Buck). They were taken by Parliament, including by many Members who are here today, and they were upheld by the Court of Appeal in 2020.
Sir John Hayes
I welcome the Minister to his place; I appreciate that this debate is his first outing and his comments about the timing are well made. However, the WASPI campaigners have never made that case; they have never said that they were against the equalisation. What they said, and rightly so, is that they were not properly informed and that is precisely what the then ombudsman confirmed in his report. Will the Minister just answer this simple question? The ombudsman said that he felt it was unlikely the DWP would respond to his report—it was sad that he should have to say that. The ombudsman proposed—unusually, in his words—that the matter be laid before Parliament. Will the Minister use his endeavours to ensure Parliament gets to vote on the ombudsman’s recommendations?
Torsten Bell
We have already had a long statement in the main Chamber. The point of debates like this one today is to make sure that the Government are held accountable for their decisions.
Torsten Bell
I will make some progress and give way later on. There has also been, as has been raised, the opportunity for all parties to call for more time and for votes in the main Chamber. I am sure the right hon. Member for South Holland and The Deepings will take that up with his party in the months ahead. I will make some progress and take more interventions as we proceed.
The ombudsman’s investigation concerned the more specific question of how changes in the state pension age were communicated to women, like my aunt, born in the 1950s. The Government started sending personalised letters in April 2009, but the ombudsman concluded we should have started 28 months earlier. My right hon. Friend the Secretary of State has apologised for that delay. We are determined to learn the lessons so that we avoid similar mistakes happening again. First, we will work with the ombudsman to develop a detailed action plan, identifying and addressing lessons from this and other PHSO investigations. Secondly, we are committed to providing clear and sufficient notice of any changes in the state pension age so that people can plan for their retirement. Thirdly, the Secretary of State has directed the Department to develop a clear and transparent communication strategy for state pension changes; work on that has already begun. This will build on changes that are already under way, such as our online “Check your State Pension forecast” service, which provides a forecast of the level of state pension, but also information about when people can take it.
The ombudsman looked at six cases and concluded that DWP provided adequate and accurate information on changes to the state pension age between 1995 and 2004. However, they also found that decisions made between 2005 and 2007 led to a 28-month delay in sending out letters to women born in the 1950s, many of whom are here with us today. The ombudsman said that those delays did not result in women suffering from direct financial loss, but that there was maladministration, and we agree.
Ayoub Khan
In spite of what the ombudsman has recommended, it is clear that the current Prime Minister recognised and advocated throughout the country that WASPI women were dealt an enormous injustice. It is a principle of democracy where we advocate for something when we want power, we ought to deliver once we get power to maintain trust and confidence. In spite of what the ombudsman recommends, does the Minister agree that the Prime Minister should honour what he advocated?
Torsten Bell
I thank the hon. Member for his intervention. The Labour party did oppose the acceleration of the state pension age in the early part of the last decade, but he and many other Members will have noticed very viscerally that the Labour party lost many elections since then. Parliament made a decision and the courts have since endorsed that decision. There was maladministration and we must learn the lessons.
Grahame Morris
I appreciate that being newly in post is difficult, but can I clarify something? The Opposition spokesman, the hon. Member for East Wiltshire (Danny Kruger), said that the changes were introduced in 1995—I believe under John Major—but the acceleration of the changes was in 2011-12, under the coalition Government. I think Steve Webb was the pensions Minister. My hon. Friend the Minister says that there was no financial loss, but there must be a financial loss for the women affected. We could argue whether that is justified. We certainly cannot argue that a majority in Parliament passed it. The women must have suffered a financial loss because of having to wait another six years before getting their pension.
Torsten Bell
I thank my hon. Friend on two fronts for his intervention. First, because he has reinforced the point that I just made, which was that we are struggling to distinguish between the rights and wrongs of the original decision about the state pension age, the equalisation in 1995, the acceleration in 2011 and the ombudsman’s report, which is focused narrowly on the communication of those decisions. On a second front, he reminds us that it was in fact George Osborne who said that the acceleration of the state pension rises was the single biggest saving that he made. He boasted about it, but that is a separate issue.
Torsten Bell
I think I should make some progress and give way later. I want to get on to the bit that most Members might not agree with, but at least will explain what we are doing, because we do not agree with the ombudsman’s approach to injustice or indeed to remedy. The right hon. Member for New Forest East (Sir Julian Lewis) and the hon. Member for Salford (Rebecca Long Bailey) rightly noted that is unusual, and it should be unusual. However it is also not unprecedented.
The decision not to introduce a compensation scheme was difficult and complex. The ombudsman assumed, despite evidence to the contrary, that sending letters earlier would have fundamentally changed what women knew and how they acted. However research from 2014 shows that only one in four people who are sent unsolicited letters actually remembers receiving and reading them. The ombudsman does not address this evidence.
Neil Duncan-Jordan (Poole) (Lab)
I am grateful to the Minister for giving way. Will he confirm whether the Government’s decision and their claim that only 10% of women affected were unaware of the state pension change is based on a survey from 2006 involving just 210 respondents?
Torsten Bell
If my hon. Friend will allow me to make some progress, I will come to exactly that point shortly.
There was considerable awareness that the state pension age was increasing. I think everyone agrees on that even if they do not agree about the research itself. The research used by the ombudsman, from 2004, shows that 73% of people then aged 45 to 54 were aware that the state pension age was going up. Further research shows that, by 2006—when the ombudsman finds that the direct mailing should have begun—90% of women aged 45 to 54 were aware that the state pension age was increasing. We therefore cannot accept that, in the vast majority of cases—and I appreciate it is in the vast majority of cases—sending letters earlier would have affected whether women knew their state pension age was rising or increased their opportunities to make an informed decision. It would not be reasonable—
Sir John Hayes
I am extremely grateful to the hon. Gentleman for giving way to me for a second time. To be clear about this: there are two issues at stake here—how many women knew, and how communications would have affected that. The fact of the matter is that the ombudsman’s report—I have it in my hand—says
“Research reported in 2004 showed that only 43% of all women affected by the 1995 Pensions Act knew their State Pension age was 65, or between 60 and 65.”
That is a clear majority of women who did not know. Therefore the only debate is whether communicating with them would have been effective. As my hon. Friend the Member for East Wiltshire (Danny Kruger) said, if it would not have been effective, what is the point in Government communicating at all?
Torsten Bell
I was not going to go into this detail, but the right hon. Member for South Holland and The Deepings is inviting me to return to some of my past lives with the details of surveys. The 43% figure that he is referring to refers to all women. What the ombudsman did not do is look at the same survey and look at the women who were affected by this change, who were obviously slightly later in life and much more likely to know about their state pension age. That is where the higher figures I am quoting come from. It is from the same survey as used by the ombudsman, but it is focused on the women who are actually affected by the change.
Richard Burgon
I thank the Minister for giving way and I congratulate him on his appointment. However, to get to the crux of this: when the decision our Government have made on this was announced—and there is much to be proud of in what it has done since the general election—my jaw hit the floor. I was flabbergasted. It is my belief that the vast majority of Labour MPs could not believe it when it was announced. That pales into insignificance compared to the reaction of the WASPI women who I and others have been proud to support in my Leeds East constituency and elsewhere. My last point is that, before this decision was made, I said to the WASPI women outside Parliament that justice delayed is justice denied. This is worse than that. I thought I was just trying to compel our Government to hurry up and make a decision. This is not justice delayed is justice denied. As it stands, unless we do something, this is justice denied full stop.
Torsten Bell
I thank my hon. Friend for his intervention and for his brief congratulations on my appointment prior to his wider comments. I would say gently that he and I both stood on the same manifesto which did not promise to provide compensation, and lots of Members have talked about trust in this Chamber. There was a clear choice not to make that promise in the manifesto.
Torsten Bell
I really must make some progress because we are about to run out of time.
It would not be a reasonable or fair use of taxpayer money to pay compensation to people whose circumstances would be the same today even if the maladministration had never occurred. A compensation scheme would cost up to £10.5 billion, less than the scheme previously proposed by the right hon. Member for Hayes and Harlington (John McDonnell) but still a significant amount.
The ombudsman is clear that, as a matter of principle, redress and compensation should normally reflect individual impact. The Department considered at length whether a tailored scheme could be delivered, but it was simply not a viable option. The ombudsman’s report acknowledges the cost and administrative burden of assessing the individual circumstances of 3.5 million women born in the 1950s. Indeed, it took the ombudsman nearly six years to investigate just the six sample cases. To set up a scheme and invite 3.5 million women to set out their detailed personal circumstances would take years and thousands of staff.
Jeremy Corbyn (Islington North) (Ind)
Will the Minister give way on that point?
Torsten Bell
I must make some progress.
We also do not believe that paying a flat rate to all women would be a fair or proportionate use of taxpayers’ money. I want to address the questions asked by several hon. Members about the specific research findings. It is important to say that the evidence on what women knew about the state pension age changes is robust. The same research was used by the ombudsman, who clearly did not have concerns about its validity.
I have heard hon. Members make powerful speeches today and I understand the strength of feeling on this issue, not least from my aunt. Many women born in the 1950s worked hard in paid jobs, often balancing that with raising a family. The Government have a responsibility to take their concerns seriously, which is why Ministers listened, reflected and carefully considered this complex decision. As custodians of the public purse, however, we must also ensure that decisions are rooted in evidence and are fair to everyone.
The fact remains that the vast majority of women knew that the state pension age was increasing. Even for those who did not, we know that sending letters earlier would not have made a difference in most cases. [Interruption.] Although I know that that decision will be disappointing, as we are hearing, and many have been frustrated by watching this debate drag on for years, we believe it is the right course of action. Of course, it is also right that the Government should be held to account for that decision, as is happening today.
Jeremy Corbyn
I congratulate the Minister on his appointment. I think I am right in saying that it is unprecedented for the Government to reject in its entirety an ombudsman’s report and offer absolutely nothing. Those women were led up the garden path in the last election, and before that, by people saying that compensation was going to be paid. The Minister needs to explain why the Government are simply ignoring the plight of those women.
Torsten Bell
It is an important issue, and we have been listening to the plight of those women for many years—and rightly so. Important and powerful cases have been made by many hon. Members, but I have set out why the Government have made that decision.
We will continue to help women born in the 1950s and pensioners across the UK by investing a crucial £22 billion into NHS England this year and next, with consequentials for the Welsh and Scottish Governments.
Torsten Bell
No, I will not.
The biggest betrayal of our older generations is the state of our health service. We will also boost the state pension by up to £1,900 by the end of this Parliament. As the new Pensions Minister, I know that nothing is more important than providing a foundation for the secure retirement that everyone deserves after a lifetime of work.
Sir John Hayes
I thank all hon. Members who have contributed to today’s debate. It has shown that the sense of injustice felt by the WASPI women is shared by Members on both sides of the House of Commons. Sadly, however—I am sorry to say this to the Minister—it is not shared by those in the driving seat who are making the decisions.
Rachel Gilmour (Tiverton and Minehead) (LD)
Will the right hon. Gentleman give way? I will be quick and nice.
Sir John Hayes
No—forgive me, but my time is very short.
I sincerely hope that we will get a parliamentary vote on this issue and I will use every endeavour to ensure that we do. The WASPI women deserve better than the explanation we heard today, which was essentially somewhere between, “We’re not sure that their case is justified, because we think that most of them did know,” and, “We can’t afford it even if their case is justified.” Frankly, neither of those arguments will wash. The Minister, who is, as I said earlier, a decent man, must know that, just as the Prime Minister certainly feigned to know it before the general election. The question must therefore be asked, did the Prime Minister not know or did he not care? Was he careless about the support that he offered the WASPI women or did he not know what the Minister has just said?
I end with Winston Churchill, because I can do no better. He said:
“There is no worse mistake in public leadership than to hold out false hopes soon to be swept away. The British people can face peril or misfortune with fortitude and buoyancy, but they bitterly resent being deceived”.
This is deceit—nothing less, nothing more.
Question put and agreed to.
Resolved,
That this House has considered compensation for women affected by changes to the State Pension age.
Farmland Flooding
(3 days, 7 hours ago)
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Jerome Mayhew (Broadland and Fakenham) (Con)
I beg to move,
That this House has considered nature-based solutions for farmland flooding.
It is great to see you in your place, Dr Murrison. Before I start, I will draw your attention to my declaration in the Register of Members’ Financial Interests: I am a director of a farming company. I do not claim to be a farmer—look at my hands—but I am directly involved in farming and I could benefit from some of the measures that I am proposing.
There are two areas that I want to discuss. The first is the impact of flooded fields on farms and what should be done to help them. The second is the impact of agricultural flooding on other areas of flood risk, and what should be done to incentivise farmers to help ameliorate flooding elsewhere by accepting flooding in some areas of their farms.
Before I go into that, it is necessary to look at the background, and I will give some stats to help paint the picture. Seventy four per cent of the total floodplain in the United Kingdom is agricultural land. That is perhaps no surprise, because centuries of flooding and recession have formed some of our richest agricultural land. In fact, 60% of our best and most versatile land is on the floodplain. As a result, the argument about what should happen with floodplains—whether they should be allowed to flood, be rewilded or be retained for agricultural use—is central to the significant and increasingly political debate about food security.
The incidences of flooding are increasing. We can argue about the reasons behind that, although we do not need to do so today. Last winter, there were more than 1,000 flood warnings for farmland, which was a record high. As any farmer will say, particularly in the east of England, last spring the land was inundated with water. It was impossible for farmers to get on the fields until much later than normal, which had a knock-on impact on sowing and a consequential impact on yield for this year. More recently, we had the new year’s flooding right across the country.
We can see from that pattern, and from a much longer one, which we do not need to go into, that there is now a norm. If we look at the new and updated forecast of the change in our weather patterns that we should experience through global warming, although it is true that it will be warmer and drier in the summers, the expectation, which so far seems to be borne out by reality, is that the winters will be wetter with greater incidences of intense rain, which is the kind of rain that leads to flooding. We need action to fix the changing situation.
The first argument I will make about flooding on farms is that watercourses need to be cleared. Not every drainage needs to be slowed down to prevent flooding elsewhere. Although that is very fashionable—I fear that some of that fashion has found its way into the Environment Agency—it is crucial that drainage that is intended to remove water from productive farmland is cleared regularly, either by the Environment Agency or by it getting out of the way and allowing local farmers to do that on its behalf. Farmland is not free flooding for the Environment Agency. That is a crucial distinction between what the Environment Agency may have planned for flood defences lower down the watercourse and the necessary requirement that the best and most versatile land continues to be used effectively for food production.
We need to identify potential flood relief, including areas where the quality of the land is less good and where, in negotiation with landowners and farmers, we can identify historical floodplains and, perhaps, flood meadows. One of the few traditional flood meadows that still exists is in my constituency at Sculthorpe meadow, and there is another one on the Wensum. That is part of only 1,100 hectares of traditional flood meadow that still exist in the country. There can be agreements there with the Environment Agency, to take advantage of the funding that is available from central Government, which I will come to in a minute. There is a potential for farmers to benefit from allowing areas of lower-quality land to accept flooding for the benefit of others.
Matt Rodda (Reading Central) (Lab)
I thank the hon. Member for securing this debate, which is important not only to rural communities and farmers, but to people living downstream in larger towns. Does he agree that the sort of discussions that he describes need to be held with landowners quite far up the catchment area, towards the top of a large river catchment? For example, for our area in the Thames valley, the ideal position would be that farmers in the Cotswolds or in the northern part of Oxfordshire are consulted about this, rather than farmers further downstream in the central part of Berkshire.
Jerome Mayhew
The hon. Gentleman is entirely right. One of the beauties of the environmental land management scheme brought in by the last Government is that it has three stages. There is the in-field sustainable farming incentive, countryside stewardship, which has the in-farm elements, and the landscape recovery tier, which anticipates exactly that—I would describe them as in-valley projects. It is right that we should look right across a watercourse in those discussions, but it needs to be done in consultation with farmers, who should not have this imposed on them by a lack of drainage on the part of the Environment Agency.
Where there is flooding of productive farmland, it is necessary for the Government to build on the farming recovery fund, which was instigated by the last Conservative Government. That provides up to £25,000 a farm for an uninsured loss event. I welcome the Government’s announcement that they will provide an additional £10 million to that fund, but that is the start, not the end, of what needs to be done, so that farmers who suffer uninsurable loss to their farmland—their productive livelihood—are compensated.
Sarah Dyke (Glastonbury and Somerton) (LD)
I thank the hon. Gentleman for securing this important debate. I represent Glastonbury and Somerton, and part of my constituency lies on the Somerset levels and moors. Somerset is always at the forefront of flooding. In fact, 91% of Glastonbury and Somerton is agricultural land, so we depend on our farmers to store floodwater on their land to prevent our homes from flooding. Does he agree that we should properly compensate our farmers when they store water on their land, and that we should provide schemes with an extra £1 billion a year, so that farmers have the resources that they need to provide resilience not only for farming, but to our homeowners and residents across the county?
Jerome Mayhew
The hon. Lady is right in concept, in that where there is uninsured loss of productive farmland caused by flooding, the last Government was right to create the farming recovery fund to compensate, at least in part, for those losses. As for flooding by agreement, if I can describe it as that, that happens on the Somerset levels as part of the landscape recovery agreement there—it is called the Adapting the Levels project. That needs to come with sufficient funding under the environmental land management scheme, and I will address wider funding concerns later.
Farms can have a role in minimising flooding, and they can do that in-farm as well as further down the watercourse. But the Government must continue to work with the Conservatives and with the environmental land management scheme, which the previous Government set up, to recognise and support this.
We start at the top of the watercourse. Where available, there is upland peatland restoration. Peat bogs, when they are in good condition, are essentially like giant sponges, not just for water but for carbon storage. When they are in poor condition, the cycle goes into reverse, both for water and for carbon emission. Riparian buffers, which can be planted and maintained next to watercourses, slow the flow of water off the land and absorb a percentage of it.
More importantly and more interestingly—I was about to say for farmers like me, but I am not a farmer—for people involved in farming, there are the in-field developments, which are becoming increasingly mainstream and have developed from the regenerative agricultural movement. They are based around soil management. We always used to describe this as the heavy metal approach—that does not refer to our taste in music, but is instead about plough, drill and till, which has been the “traditional” method of agriculture since the second world war, where the inputs come out of a sack and horsepower is relied on to manipulate the soil.
The problem with that, apart from its very significant impact on biodiversity—that is a debate in its own right—is that this leads to collapsed soil structures and then we need to go into subsoiling. The more metal we use, the more heavy metal we need to use, and that destroys or very substantially limits the ability of the soil to absorb and then retain water. That has the short-term impact of increasing run-off, leading to flash flooding in a way that did not happen when I was a boy. It also has a knock-on impact in the summer. If there is a soil structure that is not capable of absorbing and retaining water in the winter, it becomes water-hungry in the spring and summer, and there is parching in a way that affects yield and costs money in irrigation to compensate for that.
There is a movement called the regenerative or min-till movement, where that approach has been challenged. By minimising the impact on soil—the disturbance of soil through metal—the soil structure can be increased, retained and developed. That creates spaces in the soil in which to absorb water, but it also has a secondary impact, which is the mycorrhizal interaction of live roots. That secures carbon and improves the sponginess of the soil.
All those things are great because as absorption is increased, the speed at which that water is emitted back into the watercourse is reduced. Allied to that is the use of cover crops during the winter. Having live roots in the water and a structure that prevents run-off and soil erosion in the winter is enormously important. There is also contour ploughing—that is, ploughing along the contour, not up and down it, as a matter of course. That is basic physics, but it helps to retain water on the land and slows its emission down into the watercourse. These are all things that the farm can do in-field to help its cause, and also to retain water for lower down the watercourse.
A second option, suitable for less valuable land that is not the best quality or the most fertile, is to accept seasonal water, along the lines followed by a traditional water meadow. Watercourses can be re-wiggled—I am not sure if that is a technical term—to slow down the flow of water in appropriate areas. By accepting floodwater, farmers are able to re-establish traditional meadows, but they need to be compensated because they are giving up productive land, albeit less productive land, to provide a social good. The whole concept of the environmental land management scheme was public money for public good.
Blake Stephenson (Mid Bedfordshire) (Con)
I thank my hon. Friend for securing this important debate. Farmers in the Flit valley in Mid Bedfordshire are concerned that repeated flooding and waterlogging has left large areas of farmland unfit for agricultural purposes. Our farmers are prepared to do the hard yards to put in place nature-based solutions, but does my hon. Friend agree that they need support and certainty from the Government to achieve that?
Jerome Mayhew
My hon. Friend is absolutely right. The basis behind my seeking this debate is to highlight the need for continued, not new, Government support. ELMs is a Brexit dividend. It would be a crying shame if the Government failed to build on the very good work of the last Government, as I will come to in a minute.
ELMs is the flagship scheme. The last Government honoured their commitment to provide £2.4 billion every year, from 2019 onwards, to support the transition from area-based payments to public money for public good. The sustainable farming incentive supports soil quality, water quality, hedgerows, tree planting and riparian buffers. There are also the countryside stewardship scheme, and the landscape recovery scheme which I have already mentioned. Other schemes include the England woodland creation offer and the nature for climate fund. All those schemes back up the transition to nature-based solutions, and allow farmers to recognise and mitigate for changes in rain distribution and intensity. They provide funding for the changes necessary for biodiversity and food production.
Maya Ellis (Ribble Valley) (Lab)
The hon. Member has rightly highlighted the intricate and technical knowledge required to understand some of the mitigations, so I welcome our Government’s commitment to a floods resilience taskforce. Does he agree that it is integral that farmers are involved every step of the way in the development of solutions, particularly because of the changing nature of flooding?
Jerome Mayhew
Of course I agree. My message to the Government is that when they are dealing with flooding, particularly through the Environment Agency, they need to do so in collaboration with farmers and get their agreement. If a watercourse is going to be slowed down through a lack of clearance, they need to recognise where that water will end up. Such an intervention does not simply lead to freak flooding on a neighbour’s land or even their house; it will have consequences for businesses and food security. The Government need to work in collaboration with farmers and be prepared to pay if the benefit of other people’s land is used.
I recognise that, up to now, my entire speech has had nothing to do with the Minister’s portfolio because she deals with flood defences. I am sure she has a deep knowledge of farming, but it may not be quite deep enough to answer some of my questions. She will be relieved to know that I am moving on to discuss natural flood management schemes as part of the Government’s flood defence budget of £5.2 billion.
The last Government made a step in the right direction, albeit a small one, by allocating £25 million to natural flood management schemes. That amount needs to be increased because the lesson from the initial schemes is that they are relatively cheap but very effective. Why do we not do more of them and build on that Brexit dividend?
That leads me to the scary bit: the Budget. I have real concerns. The Secretary of State for Environment, Food and Rural Affairs trumpeted his £5 billion over two years to support agriculture, which he says is a record amount. However, it is only the biggest ever amount if you ignore inflation, Dr Murrison, which none of the rest of us can. That £5 billion would need to be £5.8 billion across the two years, and then through the rest of the Parliament, to match the £2.4 billion equivalent from 2019 onwards. So we are already £800 million short over the course of the Parliament.
What happens after 2026? In the Budget, it says that future
“funding pressures on flood defences and farm schemes of almost £600 million”
will require a review into affordability. What does that mean? Does that mean it is the end of ELM schemes? Are we going to cut back on all the nature-friendly farming initiatives? Without reassurance from the Minister, and in particular from the Treasury, farmers look at this and say, “There is a cliff edge at the end of 2026.” There are two years of £5 billion, which is less in real money than they had before, and then a huge fall-off. That is a terrible message, on top of the family farm tax: cuts to nature-friendly farming. Where does this go? That is the opposite of the Labour party’s manifesto commitment, which was to an expansion of nature-rich habitats.
Will the Minister commit to the water restoration fund? Yesterday, I served on the Water (Special Measures) Bill Committee. New clause 2, which was in the name of the Opposition, including me, would have enshrined the water restoration fund in law, but it was voted down by the Government. That gives me, and farmers, real cause for concern. Will the Minister reassure farmers that post-2027 funding for farming, in particular nature-friendly farming, will be index-linked? Otherwise, it will fall off a cliff. Will she rule out cuts?
Will the Minister allocate—this is perhaps more in her personal remit—an increased percentage of the flooding budget to nature-based solutions? Those have been proven effective, and they work to compensate farmers who assist in their creation. Will she enable private sector investment in natural capital markets? Get the quangos out of the way. Let them set standards, certainly, but then allow the market in nature credits to flourish. Words in a manifesto do not mitigate flooding or support farmers; long-term funding and long-term incentives do. I look forward to the Minister’s response.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
It is a pleasure to serve under your chairmanship, Dr Murrison. I am delighted to contribute to this debate with the hon. Member for Broadland and Fakenham (Jerome Mayhew), although I feel that we are spending more time together at the moment than I am with my own family, what with the Bill Committee and other debates. I look forward to round 3—or is it 4?—tomorrow.
Emma Hardy
It is our secret.
I enjoyed the hon. Gentleman’s thoughtful contributions on the importance of using soil in the right way and how farming practices can be updated, which were valuable. As I mentioned to the House last week, and as I am sure people have heard me say before, I am fully aware of the impact of flooding on households, people’s mental health and, importantly, farmland. I have deep sympathy with farmers, so much of whose crop has been underwater this season, which has impacted yield.
The storms this winter highlight the urgent need for many of us to adapt to the threats of climate change, not least farmers, who often feel the impact directly. As climate change leads to more extreme rainfall, as has been mentioned, the number of people at risk from flooding and coastal erosion will continue to grow. I therefore want to make it abundantly clear that this new Government are committed to tackling this challenge, which is one of the top five core priorities for the Department for Environment, Food and Rural Affairs.
The good news is that work has already begun. Recognising the significant impact of flooding on farmers, the Government are bolstering England’s resilience to flooding by confirming an additional £50 million for internal drainage boards to improve assets. That is on top of the existing £25 million, and takes total investment to £75 million. That transformational investment will put IDBs on a firm footing to deliver their vital role in flood and water management. It will benefit projects that will improve, repair or replace IDB assets, including flood barriers, embankments and, as has been mentioned, the maintenance of watercourses. Projects will reduce risks and impacts from flooding for farmers and rural communities across England. To ensure that we protect the country from the devastating impact of flooding, we are investing £2.4 billion in 2024-25 and 2025-26 to improve flood resilience by building, maintaining and repairing flood defences.
However, I gently point out to the hon. Member for Broadland and Fakenham that this Government inherited our flood defence assets in the worst condition on record. We have had to come in and deal with the maintenance backlog.
Emma Hardy
I will give way to my hon. Friend the Member for Reading Central (Matt Rodda) and then to the hon. Member for Glastonbury and Somerton (Sarah Dyke), but I have only six minutes.
Matt Rodda
The Minister makes an excellent point. In my area, a major flood prevention scheme in Caversham, which is part of the Greater Reading area, has unfortunately been deferred. However, there is some good news regarding the point that she and the hon. Member for Broadland and Fakenham (Jerome Mayhew) made about landowners working together. I visited Kennet meadows and Fobney meadows, and saw three different landowners working together to rewild a flood meadow to enhance the land’s ability to soak up water. Much can be done if central Government and local government play a leading role in co-ordinating work with landowners, and build a team approach at a local level.
Emma Hardy
That sounds like an excellent example. I note that the hon. Member for Glastonbury and Somerton intervened earlier on the hon. Member for Broadland and Fakenham so, if she does not mind, I will use the last five minutes of the debate to respond to some of the comments made earlier.
We are looking at reviewing the flood funding formula, which was brought up by farmers during many of the visits that I made when I was in a shadow ministerial position. I want to work with all the various stakeholders on that, and I recognise that, in my opinion, at the moment the flood funding formula disincentivises investment in rural areas. I want to have a serious look at that.
I hate to see an outbreak of, almost, unity—although that is nice to have sometimes—but there is much love among Labour Members for natural flood management, so I welcome the comments made by the hon. Member for Broadland and Fakenham. The Government champion and support natural flood management, and I am keen to explore how we can encourage more of it, throughout England. I have therefore convened a roundtable on Monday to explore opportunities and challenges in the delivery of natural flood management. It will include experts and those directly involved in the projects, and will help inform our delivery of natural flood management. I look forward to hearing from farming representatives as part of that discussion, and have invited the National Farmers Union, the Nature Friendly Farming Network and the Country Land and Business Association. I am keen to hear how their views can feed into Government work.
As has been mentioned, various natural flood management methods can be used to protect flooded farmland, such as planting winter cover crops, soil management, matching grazing density to the capability of the land, avoiding growing certain crops on steep slopes, and blocking drainage ditches to slow down run-off and create wetland habitats. There will be measures that benefit flood mitigation in all three of the environmental land management schemes: the sustainable farming incentive, countryside stewardship and landscape recovery.
Jerome Mayhew
Those are all great projects, but farmers plan long in advance; it is not an 18 or 24-month process, and if the funding runs out in two years and there is no visibility beyond that, how are they expected to invest in these schemes?
Emma Hardy
To reassure the hon. Gentleman, the Government are committed to the environmental land management programme and are looking at funding natural flood management on farmland. As I said, we are having a meeting on Monday to discuss, with farmers, what more we can do for natural flood management.
Part of our vision for farming is a sector that recognises that restoring nature is not in competition with sustainable food production—on this point I agree with the hon. Gentleman—but actually essential to it: restoring nature helps food production. We will provide farmers and land managers with the support they need to help restore nature, which is vital to safeguard our long-term food security, support productivity and build resilience to climate change. That means continuing the transition away from payment for land ownership towards payment for delivering public goods for the environment, and continuing to use regulation to require minimum standards that will—importantly—be designed in partnership with farmers, and have sufficient lead-in times for change.
The countryside stewardship scheme already has specific flood resilience options, such as “making space for water”. I also flag that our land use framework will be coming out at some point, and that this year we will introduce new actions with flood mitigation benefits to our combined environmental land management offer, including actions to reduce flood risk, restore and enhance floodplains, and provide better storage of floodwater.
To sum up, I reiterate that the Government are dedicated to exploring ways that nature-based solutions to flooded farmland can be delivered for the benefit of farmers and others. We have already taken decisive action with the first steps to reviewing the outdated funding formula, the creation of the new, multi-agency floods resilience taskforce, and the updating of flood options under the environmental land management schemes. I look forward to continuing to engage with farmers on these incredibly important matters. I am grateful for this important debate, and grateful to have heard the views of Members in the room.
Question put and agreed to.
UK Submarine Fleet
(3 days, 7 hours ago)
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Graeme Downie (Dunfermline and Dollar) (Lab)
I beg to move,
That this House has considered the UK submarine fleet.
It is a pleasure to serve under your chairmanship, Dr Murrison. The UK submarine fleet has a long and distinguished record, always at the heart of this nation’s deterrence and defence policy. It began in 1900 when the Royal Navy ordered its first five submarines—the Holland class. In 1901, six officers were recruited for the submarine service under the leadership of Reginald Bacon, the inspecting captain of submarines.
Since the early days of the submarine service, Scotland has been at its heart. In 1909, Dundee became home to the 7th Submarine Flotilla. By 1914, the submarine service consisted of 168 officers, 1,250 ratings and 62 submarines, and the fleet was moved to Rosyth in my constituency. Without offending any hon. Members from the great city of Dundee, Rosyth was obviously a much better choice, and it retains a strong role in the submarine story to this day.
The role of the submarine service in world war one should never be forgotten, with five of the 14 Victoria Crosses awarded to the Royal Navy during the conflict being awarded to submariners. Although the focus of naval warfare in world war two is often thought to be the battle of Atlantic, I was fascinated to learn from the excellent podcast “We Have Ways of Making You Talk” with Al Murray and James Holland of the vital role of British submarines in the Mediterranean. For example, HMS Upholder sank around 119,000 tons of enemy shipping. It was commanded for its entire life by Lieutenant Commander Malcolm Wanklyn, one of the most successful submarine commanders of the conflict, who received the Victoria Cross for attacking a well-defended convoy in May 1941.
The cold war saw the submarine fleet play a key part in deterrence and intelligence-gathering capability. HMS Swiftsure, a ship I will come back to later, became famous for her mission to acquire the acoustic signature of the Soviet aircraft carrier Kiev, with her periscope raised just 10 feet underneath the carrier’s hull. In the Falklands, HMS Conqueror became the first and, to this day, only British nuclear-powered submarine to engage an enemy ship with torpedoes. After the attacks on the US on 11 September, HMS Trafalgar and HMS Triumph played a vital role in hitting al-Qaeda targets in Afghanistan. Throughout, submarines have had extensive capability and roles assisting UK special forces in their vital missions.
Today, the Royal Navy operates a fleet of nine submarines, with a little over 1,100 submariners. Four are ballistic missile submarines of the Vanguard class that comprise the UK’s submarine-based independent nuclear deterrent, along with five nuclear-powered Astute class with the capability of launching Tomahawk cruise missiles at land-based targets and Spearfish torpedoes at maritime targets. The submarine fleet is spread across the UK. Faslane in Scotland is now the home base for the fleet; Devonport undertakes major refit, maintenance and decommissioning; and Barrow-in-Furness is the manufacturing location of both Astute and the next Dreadnought class of submarines.
At Rosyth, Babcock is undertaking work on the submarine dismantling programme—more on that later, as well—and is also a manufacturer of missile tubes for the Royal Navy and the US navy. QinetiQ, also in my constituency, houses world-class scientists, engineers and technicians, who support our men and women on the frontline by ensuring that Royal Navy ships and submarines remain at the cutting age of technology.
As I have outlined, the role of submarines in history has been varied. Indeed, the flexibility of the fleet is one of its strengths. The role of submarines is necessarily secret, but it is clear that the need for subsurface protection is both critical and increasing. In 2022, the Chief of the Defence Staff, Admiral Sir Tony Radakin, said:
“There’s been a phenomenal increase in Russian submarine and underwater activity over the last 20 years.”
Torcuil Crichton (Na h-Eileanan an Iar) (Lab)
I commend my hon. Friend for raising this issue. He talks about the increase in Russian and foreign-state activity in the waters. The role of the Royal Navy and submarine fleet in protecting us from that is vast. I welcome the announcement by the Secretary of State for Defence last week that the joint expeditionary force will now monitor Russia’s shadow fleet in the Baltic. I hope that work extends to the north Atlantic, where there is a massive gap. Our frontline lies in our backyard, just beyond my constituency and my hon. Friend’s.
Graeme Downie
My hon. Friend is absolutely right. In doing research for this debate, I was fascinated to learn about the maritime range that exists off the west coast of Scotland, which is very close to his constituency. He is absolutely right that we need to ensure that our forces are defending our entire coastline, and places such as his constituency are vital to that, as are the whole of the west and north coasts of Scotland.
More recently, we have been aware of the ongoing undersea threat from Russia, most recently in the sabotaging of undersea cables in the Baltic sea. Submarines will clearly play a vital role in combating those efforts by our opponents. That is not to mention the critical role of the UK’s independent nuclear deterrent and maintaining the capability of the submarine force to support both maritime forces and those on land.
With that in mind, I turn to some of the issues faced by our submarine fleet and submariners, and the actions needed to ensure that they remain at the forefront of our armed forces now and in the future, while continuing to make a vital contribution to our economy and skills development.
I have relatives who have served in the Royal Navy, and I know from speaking to them how difficult the life of a submariner can be. Like other parts of the armed forces, the Royal Navy and the submarine service have struggled with both recruitment and retention. The basic salary for a submariner is £25,000, although it can rise to more than £37,000 with bonuses. None the less, the First Sea Lord has warned:
“We are effectively in a war for talent in this country”.
He also said that
“the submarine service…go through significant periods of real social isolation from the people they love…we must ensure the pressures that are inevitably felt by them are mitigated or eased or supported as best we can.”
Will the Minister say what is being done to support submariners and their families, and what more can be done, to ensure that we have an adequate force for the future?
I turn to future capabilities and the question of whether the submarine service has the right equipment to carry out its role. In its excellent January 2024 report “Ready for War”, the Defence Committee included evidence from Dr Rowan Allport of the Human Security Centre, who expressed this concern:
“Even once all seven Astutes are in service, it is questionable whether the force will be able to sustain their current tasks and the additional deployments to Australia and wider region from 2026 onwards.”
What assessment has the Minister made of that? Does she believe that the Astute fleet is able to carry out the role we intend it to have?
The independent deterrent is a vital service for the security of our country, and we must ensure that it is effective now and in the future. The last Conservative Government left a total deficit of £16.9 billion in the equipment plan for 2023 to 2033, of which the defence nuclear enterprise makes up nearly half, at £7.9 billion. In its report on the Ministry of Defence for the new Parliament, published in October last year, the National Audit Office found key risks in the defence nuclear enterprise relating to costs, skills, commercial relationships and delivery to schedule, and it said that those need to be
“carefully managed as DNE activity and spending increase.”
What steps is the Minister taking in the light of the NAO’s findings to ensure that the DNE is delivering effectively and efficiently?
Finally, as the Minister might have predicted—I have raised this in the House many times—I will talk about what progress the MOD is making on submarines that have been retired from service. Since 2023, the Babcock team at Rosyth in my constituency has been undertaking a demonstrator project to dismantle HMS Swiftsure—the ship I mentioned earlier that played such a vital role in the cold war—in a safe and secure way that protects the environment. That will lead to 90% of HMS Swiftsure being reused or recycled and the remainder being safely disposed of. That kind of work is not being done anywhere else in the world, and it currently employs more than 200 people in my constituency.
There are a total of 23 retired submarines—including HMS Swiftsure—currently being stored between Rosyth and Devonport that could be dismantled in a similar way. Given the knowledge and experience needed, along with the highly skilled nature of the roles, there is an opportunity to use the demonstrator project to establish Rosyth as a centre of excellence for submarine dismantling. From answers to written questions, we know two things regarding those 23 submarines: it costs £8.8 million a year to maintain the submarines at Rosyth and Devonport in their current condition, and the whole-life cost of the submarine dismantling project is £298 million.
I have two specific questions for the Minister about those figures. Can she assure me that the cost of almost £9 million a year to maintain those submarines where they are is not slowly reducing the £298 million budget? Will she work with me, Babcock, Fife council, Fife college and other local partners to help to turn Rosyth into the worldwide centre of excellence for submarine dismantling? When will she be in a position to announce the next stages of the submarine dismantling project? That announcement could be vital for the ongoing success of the defence industry in my constituency and its ability to drive local economic growth and provide secure, well-paying jobs for local people.
In closing, I put on record my thanks to the members of the submarine service, the Royal Navy and all our armed forces for the work they do every day to keep us safe. We are living in an increasingly volatile and unstable world and, sadly, it feels like our armed forces will be required to play an increased role in deterring our opponents and supporting our allies around the world in coming years. This House must be united in supporting our armed forces now and in the years to come.
Jim Shannon (Strangford) (DUP)
It is a pleasure to serve under your chairship for the second time this afternoon, Dr Murrison. There are slightly fewer people at this debate than the last one, but it is equally important. I commend the hon. Member for Dunfermline and Dollar (Graeme Downie) for his contribution. He is making a habit of picking subjects that all of us are interested in. I am particularly interested in this one.
Our submarine fleet is of major importance to the Royal Navy. It massively supports our defence role and is critically important for the future. Other countries are building up their fleets of ships, boats and submarines, and, in the interest of our national security, we in the United Kingdom should make sure that we match the demands set by others. It is a pleasure to discuss how we can further protect our security.
The cost of submarines in today’s age could be prohibitive to us in the United Kingdom of Great Britain and Northern Ireland doing that as one country, but we could do it with other countries in NATO or with Australia, New Zealand, Japan and that alliance across Asia, which is important to have in place because China is incredibly ambitious. Dr Murrison, as your contributions in the Chamber confirm, you know better than most that China is a country with imperial ambitions and a lust for all the things in the world. It is almost like a sponge—whatever it can get, it wants, and it is trying to make that happen across the world.
Back home in Northern Ireland, we do not have our own dedicated submarine fleet, but we do have many people who serve in the UK fleet. We play a fantastic and important role in supporting the central UK fleet in its wider logistical, training and operational functions. I am particularly pleased to see the Minister in her place; I look forward to her response. We will hear shortly from the shadow Minister, who will bring to this debate knowledge from his former role.
Belfast, in particular, has a long history of shipbuilding and of supporting the Royal Navy. In my constituency of Strangford—I am going back a few years to when I was a wee boy in the ’60s and ’70s in Ballywalter, where we moved in 1959—the tradition was not necessarily the Army, but the Royal Navy. I remember that when I was a young boy, almost everybody who left Ballywalter to go into service went to the Royal Navy. That has changed greatly—fortunately or unfortunately, depending how one looks at it. Today, the tradition is the Army and, to a lesser degree, the Royal Air Force. Very rarely do we have anybody who joins the Royal Navy.
I found an exception when I went to one of my constituents’ houses on a Sunday two weeks ago. There was a wake on—we in Northern Ireland have a tradition of going to wakes when someone we know very well has passed away. The young fellow in the house was 19 years old and going into Royal Navy officer training at Dartmouth. He renewed my interest in this subject. He is a really special young boy from the village of Ballywalter who is going to be an officer in the Royal Navy. He has committed his life to service.
The Harland and Wolff shipyard can also play an important part. Lots of things have happened in the last few days in relation to Harland and Wolff; hopefully Navantia, which will take over the shipyard, will promote shipbuilding and submarine work. The shipyard was formerly key to the construction of naval vessels, and in the present day it is an important hub for maritime-related activities, alongside Belfast port.
The hon. Member for Dunfermline and Dollar is rightly a keen supporter of the submarine dismantling programme, given the benefits it could bring to his constituents. I would expect any MP to do that for their constituents, and he does it well. The Minister has made it clear that, despite the fact that we have had nuclear submarines since the ’80s, we have never dismantled one. If she does not mind my saying so, if we are going to look at this matter constructively and seriously, we in Northern Ireland wish to play a part in that work, and I believe that we could. I am not suggesting that we should take the work away from the constituency of the hon. Member for Dunfermline and Dollar; I am just saying that there is a way of bringing us all together, and I think it is important that we do that.
The UK submarine programme faces some challenges with funding, construction delays and technological advancements. Our nuclear-powered submarine fleet is heavily dependent on nuclear propulsion technology, which requires high levels of maintenance and safety oversight. It is important that we are up to speed on that, but it is also important that we look forward to the future. Our defence mechanisms are extremely important, and in continuing to modernise our fleet, we will ensure that we have one of the most capable submarine forces across the world. That is the ambition of the hon. Member for Dunfermline and Dollar, and it is a good one to have. It is an ambition that this Government should have, and it is one that I fully support.
In conclusion, there are ways and means by which every nation in this United Kingdom can play its part in the advancement of our submarine fleet. I look to the Minister for reassurance that that will be taken into consideration in discussions of our fleet, and I look forward to hearing further updates on the dismantlement programme.
Several hon. Members rose—
Dr Andrew Murrison (in the Chair)
I intend to call the Opposition spokesman at 5.8 pm. There are several Members seeking to catch my eye, so brevity is a virtue.
Mr Paul Foster (South Ribble) (Lab)
I will be brief, Dr Murrison. I start by congratulating my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) on securing this important debate on what is without doubt one of the most—if not the most—critical elements of our nation’s defence. After all, our submarines carry our ballistic nuclear weapons, which are our continual at-sea deterrent.
I have a long-standing passionate interest in the submarine fleet, as they are built by my friends and family in my hometown of Barrow-in-Furness, albeit that is not my constituency. It is true that I could well have entered into a career in building them myself had I not decided to join the British Army instead in 1988. I wish to publicly commend the continued outstanding work of all the personnel within BAE Systems in Barrow in building what are quite possibly the most technically advanced submarines in service. Additionally, I commend our submariners who do a job that I never could—for extended periods, they keep us all safe from those who wish to cause us harm. I am also fully supportive of retaining our nuclear deterrent, as well as the replacement Dreadnought programme.
Looking at the current UK submarine fleet, I have some concerns on a number of issues, but I am aware that it would not be appropriate to raise them all, given the classified nature of operations. As I mentioned, I commend our submariners serving the Royal Navy in an exemplary manner, and I hope that the current recruitment and retention issues being experienced within the service can be addressed quickly. The time that those individuals spend continually at sea is certainly an issue that requires some focus, which I hope it is receiving. The substandard defence accommodation for our serving submariners and their families is also clearly an ongoing issue. The Secretary of State is dealing with that as a priority, and I would appreciate updates as to the progress that has been made.
The UK’s next-generation attack submarine, AUKUS, in collaboration with Australia and the United States, is a huge opportunity for not just the shipyard in Barrow but the entire nation. It is pleasing to see that global collaboration with two of our strongest allies, but it also provides a long-term strategic path, along with the Dreadnought programme, for the submarine service to grow from strength to strength and for the United Kingdom to continue to be a leading power in the sector.
Catherine Atkinson (Derby North) (Lab)
Does my hon. Friend agree that we need to grow the skills necessary to build the service and maintain our submarine fleet? Rolls-Royce Submarines in Derby is doubling the size of its site in preparation for AUKUS, and it has its own nuclear skills academy with 200 apprentices every year. Does my hon. Friend agree that investing in apprenticeships is essential to providing the skills that we need?
Mr Foster
I wholeheartedly agree. One of the challenges that we have faced in Barrow over a number of years is losing all the trades and the young people, because previous Governments did not invest in the submarine fleet. Barrow is a small town, but my hon. Friend is right that this is a massive opportunity not only for Derby and Barrow, but for the entire country. I am sure that no one present would disagree that the British Astute-class attack submarine is quite possibly the best there is globally.
I did say that I would be brief, so I will finish soon, but one area that requires much attention—I am aware that the Government are looking at it closely—is submarine decommissioning and dismantling. My understanding is that, as my hon. Friend the Member for Dunfermline and Dollar mentioned, 23 submarines await dismantlement at the Rosyth or Devonport dockyards, with no final solution yet agreed. Furthermore, four Vanguard-class submarines will leave service in the 2030s. I trust that the ongoing strategic defence review is looking closely at the issue.
To conclude, the UK submarine fleet delivers the cornerstone of our nation’s defence. Our Royal Navy submarine service should be commended for the unwavering, continued and extremely challenging service that it provides to this country.
Chris McDonald (Stockton North) (Lab)
It is a pleasure to serve under your chairmanship, Dr Murrison.
I, too, congratulate my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) on securing this debate. In his time in the House, he has been a real champion for our submarine fleet. It is an incredibly important subject, and I thank him for his work on it. I am pleased to support him in the debate today.
Some time ago, Admiral Lord West warned that the underfunding of our forces over a number of years has caused them to be “hollowed out”. General Lord Houghton made a similar comment to the Defence Committee in 2023, when he also referred to the “hollowing out” of our armed forces. That has been recognised, but I will also refer to the hollowing out of some of the industrial supply chains on which our armed forces and submarine fleet depend.
We approach the replacement of Vanguard with Dreadnought and, eventually, of Astute—we hope through the AUKUS programme—with a new SSN-AUKUS submarine, for which much of the work will be done in the UK. The design work has already been started by BAE Systems and, as we heard from my hon. Friend the Member for Derby North (Catherine Atkinson), by Rolls-Royce. This will be a colossal feat of British engineering.
As well as the design work, manufacturing and construction, however, we need to think about the supply chain. Filling the critical supply-chain gaps will be required to ensure that the economic benefit of our new submarine design is achieved. Steve Timms, managing director of BAE Systems Submarines, described this as “a once-in-a-generation opportunity” to boost education, infrastructure and technology. In his words:
“It will sustain thousands of jobs and generate billions of pounds of investment into the middle of the next decade, benefiting every region of the UK.”
We have heard about some of that today.
I will highlight one specific example of how our defence industrial strategy, which we anticipate in the spring, and our industrial strategy must come together to support that: the hull. That is the part of the submarine that keeps our submariners safe, and it is manufactured from steel plate. Currently, that steel plate will be made of slab steel in Scunthorpe, rolled at the Dalzell rolling mill in Motherwell and possibly sent to Clydebridge as well.
Those facilities have suffered some issues in recent years, such as the ongoing issue with the Jingye steel plant in Scunthorpe and whether it will continue, and that of the Liberty steelworks in Scotland. Securing those capabilities is important, because although the chemistry of the steel is available, the properties that keep the submariners safe—the strength, the toughness and the ballistic performance of the steel—is all down to the processing of the steel, including the heating and cooling, the chemistry and so on. That is down to the expertise of our steelworkers.
Today, I thank not only our submariners and the communities that support them, but our steelworkers, whose expertise keeps the submariners safe and, as a result, keeps our country safe. As we consider our defence and industrial capabilities, my call is to broaden the scope of our thinking to understand that our sovereign capability runs beyond our immediate defence needs. We must build the capacity, the economy of scale and the skills in our industrial base so that we continue to be a nation that proudly has not only a submarine deterrent, but the skills and capabilities to build and grow that over time.
Douglas McAllister (West Dunbartonshire) (Lab)
It is a pleasure to serve under your chairship, Dr Murrison. I thank my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) for securing this debate and allowing the House to consider the UK submarine fleet. It also allows me to recognise the importance of the submarine fleet to the UK’s defence in the uncertain global circumstances that we face, and the fact that the Royal Navy’s entire submarine fleet is based at His Majesty’s naval base commonly referred to as Faslane.
Although Faslane is just beyond the boundary of my West Dunbartonshire constituency, it is a major source of employment to my constituents. HMNB Clyde is one of Scotland’s largest employers, employing over 6,000 military and civilian personnel directly. Indirectly, some estimates suggest that it supports over 10,000 jobs. It is therefore impossible to overestimate the importance of Faslane to the economy of my constituency, or its strategic importance to the UK submarine fleet.
The fleet currently has nine submarines, with a further two Astute-class attack submarines due to enter service by the end of 2026. Those nine are a combination of five conventionally armed nuclear-powered attack submarines and four ballistic missile submarines of the Vanguard class. In 2009, the previous Labour Government took the welcome decision to base the entire submarine fleet at HMNB Clyde, designating Faslane as their home and developing it as a submarine centre of excellence. I encourage this Government to recommit to investing the funding required to accommodate the evolving submarine fleet as the UK prepares for the Dreadnought class to enter service in the early 2030s. That would continue to safeguard our nation’s defences and secure the future of the Faslane base and thousands of jobs for my constituents for a generation.
It was my great privilege and honour to visit Faslane in November with the Scottish Affairs Committee. Our visit included the unforgettable experience of having tea inside an Astute-class submarine with the captain and crew members. We discussed the obvious challenges and concerns about manpower and the potential future skills shortages in the submarine service, which I encourage the Government to focus on. However, my lasting memory will be of the conditions and how confined it is inside a submarine, with six men to a tiny cabin who are often out at sea for anything up to six months, completely detached from family and loved ones. We ask so much of our vital service personnel and they sacrifice so much to keep us all safe. I thank them for everything they do to keep our country safe in these challenging and worrying times.
In conclusion, I commend the Government for their commitment to maintaining the UK’s deterrent beyond 2030, which recognises the benefit to employment and the economy of not only Faslane, but BAE Systems in Glasgow and Rolls-Royce. They are our main industrial partners in the submarine project, supporting tens of thousands of highly skilled jobs in West Dunbartonshire, Scotland and across the UK. I congratulate my hon. Friend the Member for Dunfermline and Dollar again on securing this debate.
Anna Gelderd (South East Cornwall) (Lab)
It is a pleasure to serve under your chairship, Dr Murrison. I congratulate my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) on securing this important debate.
Our national defence is made possible by the dedication of our people and the strength of our bases across the country, working together to keep the UK secure and our residents safe. The UK’s submarine fleet is a cornerstone of that strategy, ensuring national security. Historically, it has played a critical role in defending our nation. In these uncertain times, its importance cannot be overstated. I pay tribute to those brave serving personnel, veterans and their families across our armed forces whose sacrifices make our security possible. Their dedication deserves our utmost ongoing support and respect.
My constituency of South East Cornwall plays a crucial role in our nation’s defence. We have a proud military history, with active veterans associations across the area, including in towns such as Saltash, Liskeard and Looe. Torpoint, a wonderful town in my constituency, is home to HMS Raleigh. It has the third highest number of veterans of any community in the country, with over 14% of people having served. HMS Raleigh, as the largest Royal Navy training base in the south-west, equips recruits with the skills and knowledge needed to thrive throughout their careers in the Royal Navy.
Beyond Torpoint, many constituents work across the River Tamar in Plymouth at HMNB Devonport, which is the largest naval base in western Europe. For over 300 years, it has provided vital support for the Royal Navy and continues to play a critical role today. When the Minister gets to her feet, I would welcome her support and recognition of the importance of HMNB Devonport, and of the hard-working and skilled people who make its operations possible.
The armed forces are not only crucial for our national defence, but an essential link to local communities such as those in my area, providing high-quality jobs and a sense of community. The close social and economic ties between South East Cornwall and Plymouth mean that the success and sustainability of HMNB Devonport have a profound impact on the people I represent. I look forward to working with the Minister on this important topic and to hearing more details about the support for those whose contributions are invaluable to our national defence.
Luke Akehurst (North Durham) (Lab)
I thank my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) for ensuring that this important debate takes place. I especially wanted to put on the record my support for the Government’s nuclear triple lock, which demonstrates our commitment to the strategic nuclear deterrent and the industries that support it. It is really important that countries that might threaten us understand the strong support there is in Parliament for the strategic nuclear deterrent and the role it plays in protecting our country.
The nuclear triple lock commits us to the construction of the four new Dreadnought submarines in Barrow-in-Furness, which supports a huge number of high-quality, high-status apprenticeships and jobs—42,000 in, I believe, 2,500 suppliers across the UK directly and indirectly. The supply chain benefits are felt in every corner of the country. Dreadnought will enable Britain to maintain the continuous at-sea deterrent 24 hours a day, 365 days a year, securing protection for the UK and for our NATO allies, and ensuring that countries that might strategically threaten us understand that, ultimately, we have the protection of the nuclear deterrent. The triple lock also commits us to the delivery of all future upgrades needed for the submarines to patrol the waters and keep our country safe.
The submarine fleet as a whole is a fundamental part of UK defence both militarily and industrially, and is about the integration between those two parts. We have to keep the line of production going in Barrow to produce successive generations of submarines to carry the nuclear deterrent, and in the interim there is the much-needed attack submarines—each generation of SSNs—that we produce in the same facility. The two are dovetailed together, which means that the UK stays at the leading edge of submarine design and manufacturing. I reiterate that this provides extremely high-quality and highly skilled jobs and ensures the economic viability of a corner of the country that would otherwise be economically isolated, quite apart from jobs that extend into other parts of the country, such as in the constituency of my hon. Friend the Member for Derby North (Catherine Atkinson).
I welcome the commitment to AUKUS and the opportunities it will bring. AUKUS will create new contract opportunities for hundreds of small and medium-sized firms and 7,000 new jobs in UK shipyards and across the UK supply chain, as well as reinforce our international partnerships with two extremely important allies. I repeat my thanks to my hon. Friend the Member for Dunfermline and Dollar. The debate has been a really important opportunity for a range of Members to reiterate their support for the UK’s submarine fleet.
Helen Maguire (Epsom and Ewell) (LD)
It is a pleasure to serve under your chairmanship for the second time today, Dr Murrison. I congratulate the hon. Member for Dunfermline and Dollar (Graeme Downie) on securing this debate. I am disappointed that we did not somehow co-ordinate so that today the music that so often blares out on a Wednesday afternoon was “Yellow Submarine”. That song tells of the adventures of a submariner and reminds us to thank all those who serve as submariners in such confined conditions. It is so important that we recognise them, because the UK submarine fleet is critical to national security, economic development and defence of the rules-based international order.
As we have heard, the Royal Navy’s submarine fleet comprises nine vessels: five Astute-class nuclear-powered attack submarines and four Vanguard-class ballistic missile submarines. The fleet plays a central role in the UK’s defence strategy, providing a continuous at-sea deterrent and contributing to global security through intelligence, surveillance and undersea warfare capabilities, but the submarine fleet faces significant challenges. Issues such as manpower shortages, delays in maintenance and ageing infrastructure risk undermining the fleet’s operational readiness, and extended maintenance periods have raised concern about the Royal Navy’s ability to meet its current commitments as well as new obligations, such as deployments to Australia under the AUKUS agreement.
The UK submarine industry is critical not only for national defence but as a significant driver of economic growth and skills development. His Majesty’s Naval Base, Clyde, known as Faslane and home to the UK’s entire submarine fleet, has received over £1.8 billion in infrastructure investments since 2015, supporting over 6,000 military and civilian jobs, and making it one of Scotland’s largest employers. In addition, the construction of next-generation Dreadnought-class sub-surface ballistic nuclear submarines and the AUKUS submarine programme is projected to create more than 20,000 jobs across the UK, including, as has been mentioned, 17,000 new roles at Rolls-Royce in Derby. These projects foster expertise in engineering, nuclear propulsion and advanced manufacturing, ensuring that the UK remains at the forefront of global submarine technology. It is essential that we continue to invest in training and apprenticeships to attract young people to this critical sector. Our young people need to develop the skills necessary to carry out these critical projects.
Maintaining the UK’s nuclear deterrent is a cornerstone of our national security policy. For over 50 years, the continuous at-sea deterrent has been an unbroken line of defence against nuclear threats. Although I believe that the end goal should be multilateral disarmament, the reality is that the global security environment, which includes threats from state and non-state actors, makes it imperative to retain a robust deterrent.
The AUKUS trilateral security agreement with Australia and the United States marks a significant step forward in international defence co-operation. As part of this partnership, the UK will provide Australia with nuclear-powered conventionally armed submarines based on our next-generation SSN-AUKUS design.
Luke Akehurst
Can the hon. Lady confirm something for me? Her remarks suggest that the Liberal Democrats now support the continuous at-sea nuclear deterrent, but I remember a review when Nick Clegg was the leader of the Liberal Democrats that suggested scrapping the continuous at-sea deterrent and using coastal-launched cruise missiles, or aircraft operating from aircraft carriers, which I thought was most dangerous. I would be very reassured if it is now the case that the Liberal Democrats support the continuous at-sea deterrent.
Helen Maguire
I thank the hon. Gentleman for his intervention, which gives me the opportunity to clarify that we do indeed support the at-sea deterrent, as was confirmed by a motion at conference recently; I cannot remember which conference it was, but it was a few conferences ago.
As I was saying, as part of the AUKUS partnership, the UK will provide Australia with nuclear-powered conventionally armed submarines based on our next-generation SSN-AUKUS design. This not only strengthens our shared security interests in the Indo-Pacific but reaffirms the UK’s role as a leading global defence partner. We must ensure that we continue to show our strong support for the AUKUS programme, particularly given potential policy shifts in the United States. Reports suggest that the Trump Administration might renegotiate the AUKUS agreement or deprioritise the commitments that are part of it.
In addition to their role in deterrence and warfare, submarines are critical for safeguarding undersea infrastructure, including the data cables that underpin global communications and commerce. The rise of seabed warfare, particularly by hostile states such as Russia and China, poses a serious threat to these assets, and a robust submarine fleet is essential to protect the UK’s interests in this domain.
Finally, we must tackle the long-standing issues in defence procurement. Delays and cost overruns in major programmes have hindered progress in building and maintaining our submarine fleet. A comprehensive industrial strategy is needed to provide a reliable pipeline of equipment procurement. Such a strategy would not only ensure the readiness of the Royal Navy but support the growth of the UK’s defence industry.
The UK submarine fleet is a vital component of our national security, our economy and our international partnerships. Although challenges remain, the benefits of continued investment in the sector are evident, and I urge the Government to prioritise the manpower, infrastructure and procurement reforms necessary to ensure that this critical capability is preserved and indeed enhanced for generations to come.
James Cartlidge (South Suffolk) (Con)
It is a pleasure, to serve under your chairmanship, Dr Murrison. It is very appropriate that we do so for this debate, given that you are both a former ministerial colleague in the Ministry of Defence and a former surgeon commander in the Royal Navy and the Royal Naval Reserve.
I congratulate the hon. Member for Dunfermline and Dollar (Graeme Downie) on securing this debate; it is important and timely, as well as incredibly interesting. Having been the Minister responsible for the nuclear portfolio and the chair of the Defence Nuclear Board, which is a great privilege in the Ministry of Defence, I know that one of the issues with the nuclear enterprise is that there are very few opportunities to talk about it publicly. I see this debate as an opportunity to join others—the hon. Member for West Dunbartonshire (Douglas McAllister) put it very well—in thanking all those who serve on our submarines, particularly those who have maintained our continuous at-sea deterrent 24/7 since 1969. Theirs is an incredible achievement.
It is also an opportunity to thank all those involved in the whole defence nuclear enterprise, from the First Sea Lord, down to the apprentices who work in maintenance in Devonport and manufacturing in Barrow, along with contractors in Faslane and elsewhere. It is a huge national endeavour, which I am pleased all parties here now support.
As I said in the previous debate on missile defence, led by the hon. Member for North Durham (Luke Akehurst), there is a key point about the deterrent. In the strategic defence review, we must never underestimate the role of the nuclear deterrent. I do not think anyone here does, but there is perhaps a tendency to take it for granted and therefore talk about all the other incredibly important areas, such as missile defence, the Army, the Navy and so on. To me, nuclear is the most important part of our defence, because no matter what missile defence we have, that is not the reason the Russians will not launch at us. The reason is our ability to retaliate. That is the fundamental fact of our defence. I hope it never comes to it, but it is an extraordinary weapon which we must maintain, especially with the threats that we face today, so it is brilliant to hear so many colleagues showing their support for the nuclear enterprise.
Of course, it does have its challenges. Colleagues have mentioned people and personnel, but I think it is not just about those who serve in the Navy. When I was a Minister, my hon. Friend the Member for West Aberdeenshire and Kincardine (Andrew Bowie), who was the civil nuclear Minister, and I set up the nuclear skills task force to really inculcate growth in skills in the whole supply chain, whether at AWE or Rolls-Royce, the manufacturer of the nuclear turbines.
There is also the issue of infrastructure. Speaking for the Liberal Democrats, the hon. Member for Epsom and Ewell (Helen Maguire) made a very good point: £1.8 billion has been invested in Faslane since 2015, so there has been significant investment in infrastructure, but when it comes to the nuclear enterprise, the need to invest in infrastructure is huge. It has been a significant factor in some of the issues we have experienced in terms of maintenance and so on. It is vital that the Government bring forward their promise to spend 2.5% of GDP on defence. The Minister and I both agree on that; we both had it in our manifestos. The Daily Mail splashed that the target will not be reached well into the 2030s. It would be interesting to hear what the Minister thinks about that speculation. I hope she will refute it 100%, and if not, perhaps she will tell us when we will reach 2.5% or when exactly we will be told the timeline for that.
Finally, on the point of the economic benefit, of course the nuclear deterrent is expensive, but as a percentage of Government spending it is tiny given the ultimate insurance it provides, and it brings a huge economic return. Some have spoken about the importance of AUKUS in terms of jobs and investment. It is going to be one of our biggest ever defence exports. The hon. Member for Dunfermline and Dollar mentioned Rosyth, which I believe is in his constituency, and the manufacture there by Babcock of the missile tubes. I had the privilege to visit that manufacturing operation. It is one of the best UK examples of extraordinarily skilful manufacturing. The ability to manufacture nuclear submarines, with all their technology, is quite extraordinary and we should be very proud of it. Militarily and economically, it is vital to our country. It is good to see that we are maintaining a consensus today in support of the nuclear enterprise and our submarine fleet.
The Minister for Border Security and Asylum (Dame Angela Eagle)
I echo the many comments that you have already heard about what a pleasure it is to serve under your chairmanship, Dr Murrison. I hope we are providing one of the most interesting of the debates that you have chaired, although having not heard the others, I cannot really have a view on it.
The Government is 100% committed to the UK’s independent nuclear deterrent, which keeps both the UK and our NATO allies safe from the most extreme threats. As the hon. Member for South Suffolk (James Cartlidge) said, and as my hon. Friend the Member for North Durham (Luke Akehurst) made a big point of setting out in his speech, we were elected with a commitment to deliver our triple lock guarantee of maintaining our continuous at-sea nuclear deterrent, constructing four new Dreadnought-class submarines at Barrow-in-Furness, and delivering all future upgrades needed for that programme. I am glad to hear the widespread consensus between all parties represented this Chamber today on that being the right way to go.
I am grateful to my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie), whose ears must be ringing at the moment with the gratitude from those around him for initiating the debate, which, as the hon. Member for South Suffolk said, is timely and important.
I am also grateful to my hon. Friend the Member for Dunfermline and Dollar for his ongoing interest in our submarine fleet and the disposal of decommissioned submarines—I am not surprised by that, given his constituency interests, but it still good to hear that he is so passionate about it. I am also grateful to those of his constituents who are among the skilled workers involved in that work at the Rosyth royal dockyard. I would like to echo comments by Members here today who have thanked both our submariners and our industrial workers, who contribute across the nations to this tremendously important enterprise. I am grateful to all of them, whether they serve on board a submarine, serve in our armed forces, or help to build or maintain the submarines, and for all the support work that goes into them.
I am also grateful to my hon. Friend the Member for West Dunbartonshire (Douglas McAllister), who talked about Faslane, my hon. Friend the Member for South East Cornwall (Anna Gelderd) who talked about Devonport, and my hon. Friend the Member for Derby South—
Maria Eagle
I knew I would get it wrong. My hon. Friend also mentioned the efforts of her constituents in contributing to this national endeavour.
The backlog of 23 decommissioned submarines that have yet to be dismantled and recycled, which has built up over many years—seven are stored in Rosyth and 16 in Devonport—is a longstanding and ongoing issue that needs to be resolved. The previous Government set out on a path to resolve it, and we intend to continue and make sure that that work is done.
While hon. Members should be in no doubt that our submarine capabilities are the envy of the vast majority of countries in the world, the disposal backlog is one of the challenges across the portfolio of the Submarine Delivery Agency that it identified in its most recent annual report, resulting from historic underinvestment in capability and infrastructure over many years. As a Government, we are committed to defueling, dismantling and disposal of those submarines, and to meeting our responsibilities at every stage of the life-cycle of our fleet. Defueling and disposal are complex tasks, and Ministers, our Submarine Delivery Agency, and our entire defence nuclear enterprise take their responsibilities extremely seriously.
HMS Swiftsure was mentioned by my hon. Friend the Member for Dunfermline and Dollar, and workers at Rosyth yard, as he knows very well, are in the process of entirely dismantling it, which is on track to be completed by the end of 2026. That will make HMS Swiftsure the first decommissioned Royal Navy nuclear submarine to be fully dismantled, with around 90% of its structure and components being reused or recycled. This is a demonstrator programme, designed to identify methods of dealing with the backlog of decommissioned submarines swiftly and safely—and, I might say, “surely”, given the name of the submarine, but that is a very corny joke. We intend to do that in a way that provides the best value for money for the taxpayer.
The responsible and innovative approach we are taking has a strong focus on sustainability. By extracting the reactor rather than storing the whole reactor compartment, we are recycling a greater proportion of each submarine and dramatically reducing the volume of radioactive material being placed in long-term storage. We are also ensuring that steel from decommissioned hulls will be able to be reused to support the manufacture of future UK-built submarines.
Workers at the Rosyth yard have also successfully and safely completed the initial stage of the dismantling process on four decommissioned submarines—which should give my hon. Friend the Member for Dunfermline and Dollar some reassurance about future work that is going on. That will pave the way to accelerate the programme, having learned, from HMS Swiftsure, the best way of going about it, and should sustain high-skilled jobs in Rosyth as we deal with this legacy.
In parallel, we are evaluating our long-term options for future submarine disposal capability in the UK, using the lessons being learned from HMS Swiftsure, to enable us to dispose of future classes of submarine as they leave service, rather than having to park them at Devonport again and then wonder what to do with them thereafter. The submarine disposal capability project was established in 2022, as I am sure the hon. Member for South Suffolk and you, Dr Murrison, recall, to identify an enduring disposal capability for future submarines. The project is still in its concept phase, assessing all options for a future submarine disposal capability within the UK. An initial study has shown that there were various potential sites for disposal, including Rosyth. That work was investigative.
Jim Shannon
I thank the Minister for her very comprehensive response. I am very keen to see that we all realise the potential from the dismantling of the submarines, and I know the Minister is very keen on that, too. Is there any possibility that we in Northern Ireland could be part of that, perhaps through Harland & Wolff and others?
Maria Eagle
I am going to have to go back to my officials and interrogate them about what the possibilities are in Belfast. It is not a place where submarine work or nuclear work has previously been done. There will be criteria that any potential place would have to meet in order to do that, but I will certainly go back and challenge my officials about the extent to which Belfast—
James Cartlidge
The Minister makes an important point, because, as she knows, there is essentially a blockage in the infrastructure caused by having all these submarines awaiting dismantling. Will she confirm that she will be looking all over the country for potential places to add capacity? I am sure she agrees it could be immensely valuable economically to those areas that get involved.
Maria Eagle
I can, of course, confirm that. We are more than willing to look at any suggestions that any hon. Member might have.
I would like now to try to answer some of the specific questions raised by my hon. Friend the Member for Dunfermline and Dollar—it is his debate. He asked specifically about the well-being of submariners, and about what is being done and what more can be done to support them and their families. We are aware of the pressure put on submariners and their families during their long periods of absence. They are given extensive training prior to deployment to try and help to them prepare for life underwater and for life away from their families for such a long time. They have access while at sea to a weekly short message from their nominated loved one, which should help, although it is, of course, not quite like being in the same place at the same time.
When returning from deployment, submariners have access to the Royal Navy family and people support services, which can offer a range of specialist, tailored welfare services if they are needed. Recognising the impact on families, the Royal Navy has also worked to enhance support for families of those deployed, backed by service charities, so there is work there. We are conscious of the extra pressure that exists, and we take steps to try to make sure that there is support and help.
My hon. Friend also asked what assessment I can make of the Astute fleet, and whether it is able to carry out its intended role. The fleet is perfectly capable of carrying out all of the roles that are required of it. As my hon. Friend knows, there are two more Astutes that are not currently commissioned yet—HMS Agamemnon and Astute Boat 7. We will continue to build those, and we expect that the new class to replace Vanguard will also be fully built—certainly, the first boat is currently on target in terms of timing—so we are confident that the fleet can do what it is intended to do.
My hon. Friend also asked what steps have been taken in regards to the NAO findings to ensure that the defence nuclear enterprise is delivering effectively and efficiently. The organisations that make up the defence nuclear enterprise are working more closely than ever before, operating effectively as an integrated team to ensure the maintenance of the continuous at-sea deterrent posture. We are harnessing expertise and experience of multidisciplinary teams to deliver this mission and are committed to sustainment and renewal of the nuclear capabilities for as long as is required. The NAO’s work is tremendously valuable to us. It shines a very positive light and focuses minds in the Department and the defence nuclear enterprise on making sure that we do the best we can to get value for money and deliver on time and to budget.
My hon. Friend the Member for Dunfermline and Dollar asked me about the budgets. He discerned from a parliamentary question the £9 million per year cost of maintaining submarines that are awaiting disposal, and he asks whether that reduces the £298 million budget for the major project portfolio data, which he got from a parliamentary answer. Obviously we do not release particular spending profiles for individual programmes, but I can tell him that the latest whole-life cost for the submarine dismantling project is £298 million, and that figure includes costs associated with dismantling work in Rosyth and maintenance costs for decommissioned submarines in Devonport.
My hon. Friend asks if I will work with Babcock, Fife council, Fife College and other local partners to help to turn Rosyth into a world-leading centre for submarine dismantling. He wants a quick announcement on the next stage of the programme. We are currently learning lessons from the dismantling of Swiftsure, which he already knows is on target to be completed by the end of next year. It will pave the way for future dismantling—my hon. Friend knows that there are already four submarines there and that the first stages of the process have already been undertaken for them. Once that work is done and we have finished with Swiftsure, we will look to accelerate the programme in Rosyth, drawing on the lessons we will have learned. That will sustain high-skilled jobs and support sustainability. My hon. Friend will see that we will have made more progress by then on the future of submarine disposal capability.
I am happy to work with my hon. Friend and his local council and other organisations—indeed, we already do. There is a partnership between the MOD, the Royal Navy, and local authorities and nearby universities and colleges called the Arrol Gibb Innovation Campus. Three projects that relate to Rosyth are currently earmarked there for funding. We are more than happy to try to assist in making sure that the local area and his constituents get best value for the money being spent in Rosyth. I hope that answers some of my hon. Friend’s questions.
Graeme Downie
I thank everyone who has participated in this debate, from the hon. Member for Strangford (Jim Shannon) and my hon. Friends the Members for Derby North (Catherine Atkinson), for South Ribble (Mr Foster), for Stockton North (Chris McDonald), for West Dunbartonshire (Douglas McAllister), for South East Cornwall (Anna Gelderd) and for North Durham (Luke Akehurst), to the hon. Member for Epsom and Ewell (Helen Maguire) and the Opposition spokesperson, the hon. Member for South Suffolk (James Cartlidge).
It has been welcome to hear a consensus. We talked about the need to ensure that we are supporting our submariners and forces across the Royal Navy and elsewhere. We must continue to ensure that the independent nuclear deterrent is maintained properly, while always recognising the value it has to our local economy. Thank you, Dr Murrison, for your efforts today.
Question put and agreed to.
Resolved,
That this House has considered the UK submarine fleet.
Written Correction
(3 days, 7 hours ago)
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Other Correction
(3 days, 7 hours ago)
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Mr Gagan Mohindra
Artificial Intelligence Opportunities Action Plan
The following extract is from the statement on the Artificial Intelligence Opportunities Action Plan on 13 January 2025.
Mr Mohindra
I welcome this action plan, which mentions data centres. As the Secretary of State may be aware, the Deputy Prime Minister is currently reviewing the need for a data centre in Kings Langley in my constituency.
Both the report and the Secretary of State talk about ensuring that the infrastructure is in the right place. I am working alongside my constituents in Kings Langley, because the proposed site is prime green belt. If there is a need to build on and develop the site, housing would make better sense, because energy—a huge requirement for data centres—is not available nearby. How can the Secretary of State ensure that we are not encouraging the building of white elephants in the wrong places?
[Official Report, 13 January 2025; Vol. 760, c. 60.]
Written correction submitted by the hon. Member for South West Hertfordshire (Mr Mohindra):
Mr Mohindra
I welcome this action plan, which mentions data centres. As the Secretary of State may be aware, the Deputy Prime Minister is currently reviewing the need for a data centre in Abbots Langley in my constituency.
Both the report and the Secretary of State talk about ensuring that the infrastructure is in the right place. I am working alongside my constituents in Abbots Langley, because the proposed site is prime green belt. If there is a need to build on and develop the site, housing would make better sense, because energy—a huge requirement for data centres—is not available nearby. How can the Secretary of State ensure that we are not encouraging the building of white elephants in the wrong places?
Written Statement
(3 days, 7 hours ago)
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Firearms Licensing Fees
(3 days, 7 hours ago)
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The Minister for Policing, Fire and Crime Prevention (Dame Diana Johnson)
The Government are today laying a statutory instrument before Parliament that will increase firearms licensing fees to provide full-cost recovery for police forces, giving effect to a commitment in the Government’s manifesto.
The fees for firearms licensing applications administered by police forces were last increased in 2015 and they no longer meet the cost of the service provided. It is essential for both public safety and police efficiency that full-cost recovery fees are introduced so that service improvements can be made. The need to increase fees to help address shortcomings in firearms licensing was highlighted as essential for public safety by the Senior Coroner in his preventing future deaths reports into the fatal shootings in Plymouth in August 2021.
As well as supporting public safety, the increased fees will support police forces to provide an improved service to firearms applicants, through better resourced and trained licensing teams.
The Home Office will conduct more regular reviews of firearms licensing fees in the future, to ensure they keep pace with police costs.
The Government’s manifesto commitment refers to the money raised by full-cost recovery fees being used to support youth interventions to prevent serious violence. However, we have decided instead that firearms fees income must be retained by police forces to support improvements in police firearms licensing. Delivering the youth interventions element of the manifesto commitment remains a priority and will be funded by the Home Office.
[HCWS366]
Grand Committee
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Arrangement of Business
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The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)
My Lords, if there is a Division in the Chamber while we are sitting, this Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Great British Energy Bill
Wednesday 15th January 2025
(3 days, 7 hours ago)
Grand CommitteeRead Full debate Great British Energy Bill 2024-26 View all Great British Energy Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 43-IV Fourth marshalled list for Committee - (14 Jan 2025)
The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)
My Lords, any noble Lords who were not able to speak on Monday and who wish to speak before the opposition spokesman may now do so.
Viscount Trenchard (Con)
At the point when the Committee decided to adjourn its deliberations on Monday, I was about to make a brief intervention in support of my noble friend Lady Noakes and the noble Lord, Lord Vaux. As my noble friend Lady Noakes explained, GBE will be a private company, which would normally allow it nine months in which to file its accounts. As my noble friend explained on Monday, Amendment 88 changes that to six months, in line with the requirement for public companies. GBE may not be a public company technically, but it certainly is a company of huge interest to the public. It is therefore obviously right that the company should be required to prepare its accounts in accord with the rules applicable to public companies, rather than taking advantage of the more lenient requirement applicable to private companies.
In his remarks in the House yesterday, the Minister said that he recognised that it was the role of the Opposition to scrutinise legislation. But I ask the noble Lord: is it not actually the role of the whole House to scrutinise legislation, including the Government’s own Back-Benchers? He probably did not mean it when he said that it was the role of the Opposition.
The Minister of State, Department for Energy Security and Net Zero (Lord Hunt of Kings Heath) (Lab)
The point was that I was responding to a comment made by the Opposition Chief Whip about scrutiny. But of course I very much take the point that this is a matter for the whole House. The very fact that my noble friend Lady Young spoke to this group shows how effective that scrutiny can be.
Viscount Trenchard (Con)
I thank the Minister for his kind explanation, which certainly clarifies that. As far as my interventions on Monday are concerned— I spoke at length and several times—I take issue with and very much resent being accused of having filibustered. If the noble Lord looks at my contributions, he will find that they were all different.
I suggest that one reason why there have been so many amendments to the Bill is that so little was included in it. It is very thin Bill, but it has £8 billion of public money. Many of us are puzzled that GBE is being established effectively with £8 billion of public money, whereas Great British Nuclear, which has no public money to speak of, continues to operate in a kind of silo. I recognise that the noble Lord attempted to reassure the Committee about how GBN and GBE will work together, but I do not think that they can be described as comparable organisations.
I had intended to support my noble friend Lady Noakes and the noble Lord, Lord Vaux, on Amendment 88, and I added my name to it. I think that it is necessary because although GBE is intended to be structured as a public company, it will have only one shareholder, the Secretary of State. As my noble friend explained on Monday—she is well known as an expert in these matters—we must be sure that GBE will be managed according to the standards that would be expected by shareholders in public companies. That is why changing the nine-month provision for filing accounts to six months is so necessary.
I have also added my name to Amendment 89, in the names of the noble Lords, Lord Vaux and Lord Cameron, and my noble friend Lady Noakes. It is particularly important that the accounts must comply with the stipulation in proposed subsection (d), to provide
“an assessment of the extent to which”
any investments made or partnerships entered into
“have encouraged additional investment by the private sector”.
It is clear that the very long incubation period for nuclear projects places them outside the criteria for many private sector investors, but some public investment can be effective in unlocking private investment through match funding, as the Rolls-Royce SMR programme has already shown.
I also support Amendment 92, in the name of my noble friend Lady Noakes and that of the noble Lord, Lord Vaux, which would ensure that the Comptroller and Auditor-General must audit GBE’s accounts.
Lord Roborough (Con)
My Lords, Amendment 88, in the name of my noble friend Lady Noakes, would require more timely publication of GB Energy’s accounts, in line with public rather than private company reporting. I also support Amendment 89, in the name of the noble Lord, Lord Vaux of Harrowden. On earlier groups I have addressed the limitations of private and public company reporting versus that of listed companies. I made that argument, given that taxpayers’ money, raised at great cost through tax increases impacting pensioners, farmers and all businesses in this country, is being invested. All this appears to have fallen on somewhat deaf ears with the Minister, who seems determined to avoid anything but the lowest level of scrutiny, transparency or accountability as to how GB Energy invests this, at least, £8.3 billion.
I also alluded to my comments in the debate on the King’s Gracious Speech and I remind the Committee of exactly what I said:
“it is private capital that has driven the rollout of renewables and infrastructure in our country, and it appears that Great British Energy will be targeting investments that private capital alone will not finance. That does not fill our Benches with confidence that these investments will necessarily be judicious. Please can the Minister assure the House that GB Energy will report on the performance of its investments regularly and in detail and that the Government will be held accountable in this House for the performance of those investments?”.—[Official Report, 18/7/24; col. 36.]
In response to this question, I received the following reply from the Minister, the noble Baroness, Lady Hayman of Ullock:
“The cost to the taxpayer of its set-up and investments will be carefully managed and monitored through Parliament, and investments will be subject to safeguards and risk assessments, similar to established public finance institutions”.—[Official Report, 18/7/24; col. 126.]
That answer may not have been the answer that I was looking for, nor the answer that I may be seeking today, which many amendments tabled to the Bill have also sought, but it does seem to offer at least some scrutiny through Parliament. It does not appear to me that the Minister here today is offering even that level of scrutiny in the Bill. His response in previous groups to amendments seeking this transparency and accountability has been:
“the existing reporting requirements are set out in the Bill, which makes provision for GBE to produce and publish an annual report and accounts”.—[Official Report, 13/1/25; col. 942.]
It is hard to disagree that the reporting requirements as determined by the Government are set out in the Bill. However, the point that these amendments, and many others already debated, make is that this is simply not adequate. One set of accounts published annually up to nine months after the year end, with the potential for minimal levels of detailed reporting, is effectively writing GB Energy a blank cheque, with next to no external oversight.
As other noble Lords have suggested to the Minister, if the Government were willing to table amendments to allow for greater scrutiny in a timely manner of the financial performance of investments, and the progress in achieving the overall objectives of increasing employment, reducing household electricity bills and reducing carbon emissions, I am sure that the Committee could be satisfied, without taking so much time making similar points. On previous groups the Minister has called this filibustering. That is an unfair characterisation, at least of the groups that I have taken part in. The Government have proven deaf to the Committee’s reasonable requests, but that will not make them go away.
I am particularly taken by Amendment 89 in the name of the noble Lord, Lord Vaux, and not in the least surprised to see that it has so many supporters. It avoids amendments to Clause 6, which the Minister has pointed out is the wrong place in the Bill for such amendments, and to which my noble friend Lady Noakes has given authoritative support, but it addresses key reporting requirements around the receipt of subsidies, reporting on individual investments, achievement of objectives and strategic priorities, and impacts on the wider financial ecosystem. For these reasons, I believe it is an excellent amendment. However, it may still be lacking by relying on the relatively lax Companies House requirements for limited companies, so I also support Amendment 88 in the name of my noble friend Lady Noakes to make reporting in line with that for public companies.
As I have argued in previous groups, in support of my noble friend Lord Petitgas, who is in his place, there is a strong argument that quarterly reporting should also be required, in line with the listing requirements for publicly traded companies. As I have pointed out, if companies worth less than £100 million can comply with this, I do not believe it is a challenge for the £8.3 billion-plus GB Energy. This would also impose more disciplined reporting on GB Energy’s investees.
Why is it that the Government are so resistant to GB Energy showing proper transparency and accountability, even less than the modest commitments that I read in my response to the King’s Speech? What do the Government fear, if they are so convinced that it is worth while taking so much taxpayers’ money and investing it in energy, which in theory will be a good financial deal for the taxpayer? Last year’s business-unfriendly Budget, despite the protestations that it was pro-business and pro-growth, fills us all with concern that this Government do not understand business.
Lord Cromwell (CB)
My Lords, I am not sure what the opposite of a filibuster is, but I am going to try. I add my support to Amendments 88 and 92. They are both simple, timely, consistent and robust: elements of good housekeeping, quite frankly.
I also add my support to Amendment 89. We need to draw lessons from the experience with the water industry, whose reporting was opaque. It simply was not transparent enough on key areas of its financial structuring. This amendment would tease out the things that people need to know—people who are not forensic accountants going through the balance sheets reported by companies. Therefore, I thoroughly endorse Amendment 89.
Lord Petitgas (Con)
My Lords, I too would like to voice my support for Amendments 88 and 89. I will be brief. The timing and regularity of this reporting seems to be normal, standard housekeeping. It is not onerous, and it is legitimate. On the substance, as I said on the previous day in Committee, this is not an operating company which would report, like Ørsted or others; this is a portfolio of investments. It would be a number of minority investments; this company will not be operating assets. The Member opposite seems to be sceptical, but it will be a collection of small investments. Therefore, it will be more complex to track, and it will be important that it is clearly stated in the accounts. Amendment 89 states that.
Lord Macpherson of Earl’s Court (CB)
My Lords, I add my support for Amendment 92. It is an important principle of public audit that institutions within the public sector are audited by the National Audit Office. Indeed, when I was at the Treasury, I spent many years trying to get the Royal Household and the Bank of England within the ambit of the National Audit Office, and finally I succeeded. Long may that continue.
Lord Offord of Garvel (Con)
My Lords, I speak in support of Amendments 88, 89 and 92, which stand in the names of my noble friends Lady Noakes and Lord Trenchard and other distinguished colleagues, including the noble Lords, Lord Vaux of Harrowden and Lord Cameron of Dillington. These amendments, although technical in nature, are vital to ensure that Great British Energy operates with the highest standards of transparency, accountability and good governance. This is not simply a matter of administrative precision; it is the fundamental issue of public trust.
Amendment 88 ensures that GBE files its reporting accounts within the same timeframe required of public companies under Section 442 of the Companies Act 2006. This alignment with established statutory requirements is essential. It demonstrates that GBE, although a public body, will not be afforded preferential treatment or lesser obligations than private enterprises. The public expect and deserve this parity, especially given GBE’s role as a steward of taxpayers’ funds.
Amendment 89 introduces additional requirements for GBE’s annual reporting accounts. Crucially, it provides the Treasury with the flexibility to define additional reporting requirements over time. This ensures that GBE can adapt to evolving priorities and maintain accountability as it grows. It is worth emphasising that comprehensive and transparent reporting is not an administrative burden; it is a cornerstone of effective governance. This amendment guarantees that GBE will meet not only the letter of the law but the spirit of public accountability. By ensuring this level of scrutiny, we are demonstrating a commitment to good governance that transcends political or ideological divides but sends a clear message that public funds and the public interest will always be protected.
Lord Hunt of Kings Heath (Lab)
My Lords, I am grateful to noble Lords who spoke in this debate, both today and in our deliberations on Monday. It seems quite a long time ago since then, and I am looking forward to a very constructive engagement today and welcome the contributions that all noble Lords are going to make.
Let me say at once that I very much understand the importance of information being provided in order to judge the performance of GBE and of it being held to effective account. There is no disagreement at all between me and other noble Lords on this. Noble Lords will know, as the noble Baroness, Lady Noakes, explained very clearly in her remarks on Monday, that her Amendment 88 requires GBE to file its annual reports and accounts within six months from the end of its accounting reference period. As she said then, and as noble Lords have repeated, this aligns with the Companies Act 2006 for public companies whose shares are publicly traded. Of course I agree that a six-month filing period is appropriate for public companies. Financial markets need up-to-date and timely information on the performance of a company, as do its range of stakeholders and shareholders, to help them make informed decisions when companies are seeking to raise capital.
I also understand why noble Lords wish this discipline to be applied to GBE, but it is a private limited company owned wholly by the Crown. It is not unreasonable for the Government to say that, on that basis, we should be in line with the Companies Acts requirements, which set a nine-month filing period for private limited companies. I should also say that this is an arrangement applied to most government-owned companies: for example, the National Wealth Fund, the National Energy System Operator and the Low Carbon Contracts Company. I know that the noble Baroness, Lady Noakes, was concerned about the filing deadline, but it is also the case that the vast majority of these organisations, government-owned companies, file their accounts well in advance of the statutory requirement.
I understand the point that the noble Viscount, Lord Trenchard, made about public interest in Great British Energy, and I welcome that. Indeed, I want GBE to be well-known and seen as spearheading the drive we wish to see in relation to Clause 3 and the statement of priorities in Clause 5. We wish GBE to be as successful as possible.
My point is that, in a sense, what is in statute in relation to the Companies Act is a minimum requirement because, as GBE is owned by the Secretary of State, it will be subject to the usual mechanisms that apply in the public sector. They are put in place to ensure that the public interest is discharged and proper public accountabilities are in place.
On Monday, the noble Lord, Lord Teverson, made an interesting point: one of the concerns some people have is that, because of GBE’s structure and because it is publicly accountable, it will be subject to a considerable number of the controls put in place for bodies that fall within public accountability. The key question is: can we ensure that GBE has sufficient operational independence to perform effectively in its work? There are a number of issues here around the way it will work in future.
I should also say that the annual report and accounts are not the only means of scrutinising the funding allocated to GBE. All funding to GBE must be voted on by Parliament; because of that, it will be scrutinised through the supply and appropriations debates in the other place.
Amendment 89 in the names of the noble Lord, Lord Vaux, and the noble Baroness, Lady Noakes, proposes specific topics to be included in the annual reports and accounts of Great British Energy, as well as the granting of an additional power to His Majesty’s Treasury to require further information. I can confirm that much of the proposed content will already be included and publicly available in the annual report and accounts, as required by Clause 7, and will be laid before Parliament. As an example, the financial assistance details under new paragraph (a), proposed by this amendment, will be included in the accounts of GBE. Details are likely to include issued share capital and items on the balance sheet of the company, such as borrowing from government if that method has been utilised.
The noble Lord, Lord Vaux, and my noble friend Lady Young of Old Scone were concerned that Great British Energy would need only to follow the provisions of the Companies Act in preparing its annual report and accounts. However, I can assure them that that is not the case. GBE will adhere to the additional reporting requirements for government-owned companies over and above the reporting requirements under the Companies Act. These include the obligation to follow the Treasury’s directions on accounts through the powers extended in the Government Resources and Accounts Act 2000, laid out in the government financial reporting manual and related “Dear Accounting Officer” letters. The most recent of these account direction letters requires bodies to give a true and fair view of the state of affairs, including net resource outturn, the application of resources, changes in taxpayers’ equity and cash flows for the financial year.
Furthermore, GBE will be required to report on its governance around exposure to and risk of climate-related scenarios in its operations, as set out by the Task Force on Climate-Related Financial Disclosures. Finally, any future funding of GBE will be subject to agreement through a government spending review, or another mechanism, as the Government see fit.
Amendment 92 in the name of the noble Baroness, Lady Noakes, proposes to require the Comptroller and Auditor-General to be the external auditor of Great British Energy; I think she said on Monday that it is a probing amendment. I am very happy to reassure noble Lords in this case. It is already the case that the Comptroller and Auditor-General will be the external auditor of Great British Energy. The company will also need to comply with the provisions set out in the Treasury’s Managing Public Money document, which requires the Comptroller and Auditor-General to be the external auditor for non-departmental public bodies such as Great British Energy. The requirement will also be set out in the framework document for Great British Energy, which we will debate shortly.
Amendment 90A, in the name of my noble friend Lady Young, seeks to require additional reporting from Great British Energy. Again, I assure her that much of the information that she seeks will be provided in GBE’s annual report and accounts, as a matter of course. The annual report and accounts will include key achievements and milestones, general business information relating to its strategic direction, a review of the company’s performance, challenges and future outlook, as well as financial statements and resourcing levels. It will also include reporting in line with the recommendations of the Task Force on Climate-Related Financial Disclosures.
GBE may also make more information available through reporting, such as when projects or investments are announced. We want to set this company up to be transparent and accountable, with a reporting regime appropriate to its company basis and status. The accountability of Ministers to Parliament for its performance will also be in place.
We very much take the point about the need for this organisation to be transparent and accountable. In the light of this debate, I will set out how this all comes together in detail and send a note to noble Lords. I hope that provides some greater reassurance.
Lord Vaux of Harrowden (CB)
I realise that Monday is quite a long time ago now and that the noble Lord has probably forgotten this, but I asked a specific question then. The impact assessment for the Bill says that, because the Bill does nothing but create the company, “no quantification of benefits” and costs
“has been provided at this stage”,
and that those benefits and costs
“will be subject to future spending reviews and business cases”.
I asked whether those future spending reviews and business cases would be made public.
Lord Hunt of Kings Heath (Lab)
I am not sure that I can answer that point in detail. The impact assessment is built around the legislation, rather than the future activities of GBE. May I take that specific question away? Clearly, the funding that the Government provide Great British Energy will have to be in the public domain and part of the normal process of dealing with a spending review and the financial consequences and flows of money that follow it. I am happy to look into that in more detail, if the noble Lord would like.
Lord Vaux of Harrowden (CB)
That would be very kind. The issue is that, if the Bill had been done in the normal way and included the detail of what GBE was going to do, the impact assessment would have covered those activities. However, those things are not included in the Bill so are not covered by the impact assessment. When the statement of strategic priorities and the detail of what the company will do are published, there will be no impact assessment on them, other than the spending reviews and business cases. It is important that they are made public, as if they had been part of the impact assessment that would have happened if this had been done in the usual way.
Lord Hunt of Kings Heath (Lab)
My Lords, as I said, I think we have acted properly with the impact assessment, which is based on the Bill. GBE has yet to commence its work. I have said that I will write to noble Lords detailing how we see GBE being held to account, in terms of its reporting and accountability, and I will add some more information about how that relates to the statement of strategic priorities in Clause 5.
Baroness Young of Old Scone (Lab)
I hope that in writing this note, which I welcome, the Minister will give us an account of how GBE will report on the strategic priorities set by the Government, and that they will include not just climate but environmental and biodiversity targets. They are the twin crises that GBE is helping to solve.
Lord Roborough (Con)
The noble Lord mentioned that the minimum requirement was the nine-month reporting window under the Companies Act. Could he give us an idea now of what he sees as a desirable reporting timeframe? If he would like to reflect, perhaps he could include those thoughts in his letter.
Lord Hunt of Kings Heath (Lab)
I do not think so. Clearly, there is a statutory requirement. All I was saying is that our experience in my department is that the bodies that have a similar discipline have generally reported well within that figure. I am certainly happy to say that one would always hope that an organisation such as this would report in a timely fashion, but I cannot go any further than that.
Lord Vaux of Harrowden (CB)
My Lords, the noble Baroness, Lady Noakes, regrets that she is not able to be here today, because this was scheduled after she already had other commitments, so, with the leave of the Committee, I will channel the noble Baroness to wrap up. I thank all noble Lords who have taken part in this constructive debate and the Minister for his constructive response.
Common themes are emerging throughout our discussions on the Bill, and the subject of transparency and accountability is probably the major one. I know that the noble Baroness will be disappointed by the response to shortening the reporting deadline to six months, which does not seem overly onerous. I was encouraged, I think, by what the Minister said about the reporting requirements and I look forward to receiving the letter he has spoken about. However, he did not refer in his answer to a couple of things that were in the amendment and are really important.
First, it is important that GBE reports on the investments it has made, and I do not think he mentioned that. Secondly, as a number of noble Lords mentioned, the key issue is that of additionality—in other words, what impact GBE is having on crowding-in private investment alongside the public investment. As I said on Monday, anyone can spend money. If this is to be in any way positive, it needs to attract private investment that would not otherwise have happened. It is really important that that is measured in the same way as it has to be by the National Wealth Fund. I think it is true to say that the National Wealth Fund, because it has the obligation to report on additionality, is actually performing rather well on additionality.
Lord Hunt of Kings Heath (Lab)
My Lords, I think I said by implication that I consider those matters that I would expect the company to report on.
Lord Vaux of Harrowden (CB)
I am reassured to hear that and I look forward to receiving the letter. We may need to come back to this, and I hope the noble Lord will be willing to sit down, discuss the overall questions around accountability and transparency and, I hope, put something forward himself that will strengthen what is, if I am honest, a somewhat thin Bill. With that, I beg leave to withdraw the amendment.
Lord Vaux of Harrowden
“Framework document(1) The Secretary of State must prepare a framework document which sets out the principles underpinning the relationship between the Secretary of State, Great British Energy and any other relevant public sector bodies.(2) The framework document must cover the operating and financial principles through which Great British Energy will pursue its strategic objectives and may include such other matters as the Secretary of State determines.(3) Relevant public sector bodies are public sector bodies and government departments which the Secretary of State considers will or may have a relationship with Great British Energy.(4) The Secretary of State may amend the framework document at any time.(5) The Secretary of State must consult Great British Energy before preparing or amending the framework document.(6) The Secretary of State must lay a copy of the framework document or any amended framework document before Parliament as soon as practical after it is finalised.”Member’s explanatory statement
This amendment requires the Secretary of State to prepare and publish a document setting out the operating and financial principles which Great British Energy will use.
Lord Vaux of Harrowden (CB)
My Lords, with the leave of the Committee I shall move Amendment 93 at the request of the noble Baroness, Lady Noakes, who, as I say, is unable to attend today. I will speak also to Amendment 121A, also in her name.
Amendment 93 says:
“The Secretary of State must prepare a framework document”
to cover
“the relationship between the Secretary of State, Great British Energy and any other relevant public sector bodies … The framework document must cover the operating and financial principles”,
at least, to be adopted by Great British Energy. Once finalised, the framework document must be laid before Parliament.
Amendment 121A goes a little further and would defer commencement of the Act until the framework document has been laid before Parliament. The noble Baroness, Lady Noakes, and I have several times contrasted the parliamentary passage of the UK Infrastructure Bank Bill with that of this Bill. In particular, she has raised the absence of a draft framework document for Great British Energy. All we know in relation to GBE is that the founding statement published for it last July said that a framework document would be established in due course. The Minister has not yet given any indication of the timing for that framework document.
I would not normally expect a Bill establishing a public sector body to contain a requirement for a framework document. That is because it is a document routinely put in place between the Government and public bodies, and there should be no question of a body commencing operation until all the details are in place. Hence, when we scrutinised the UK Infrastructure Bank Bill, an advanced draft was made available to those of us taking part in the Bill, which was extremely helpful in our debates. We knew the detail of what the Government were planning, and how they were intending to deliver it, which is missing from this Bill.
Although framework documents have no legal force, they set out in some detail what the Government expect of the new body. Sometimes they cover detail that could have been included in primary legislation, but usually the detail is of a nature likely to change over time and, hence, is inappropriate for statute. The important point, however, is that considerable thought and work are put into the contents of that document.
As we have discussed, it is clear that with GBE, the Government have not yet put in all the hard work on how it is to operate in practice, and what rules and restrictions will be necessary. The Minister has confirmed that this is under way and explained the thinness of the Bill on the basis that the Government had to get on with legislating, and that details would follow. That is not a sound basis for legislating, and failure to provide fuller details on things such as the framework document or strategic priorities treats the process of legislative scrutiny in a somewhat disrespectful manner. We have already discussed the concerns raised in that respect by the Constitution Committee.
I will quickly run through the key contents of the framework document for what is now the National Wealth Fund—what was the UK Infrastructure Bank—which will illustrate the things that we should have expected to see advanced drafts of by now. It sets out the strategic objectives for the National Wealth Fund. These might, or might not, be the same as required by Clause 5 of this Bill. We have seen no draft or even an outline of the strategic priorities that the Secretary of State will set under Clause 5, so we do not know whether to expect strategic objectives in the framework document. Objectives and priorities ought to be different things, but we are completely in the dark at the moment.
There are a number of operating principles, which are extremely important. They include the requirement to make a positive financial return over time, and a double bottom line—a phrase used frequently during passage of the UK Infrastructure Bank Bill, another complicated Bill—of achieving both the strategic objectives and financial return. We ought to know the financial objectives of GBE by now, especially in view of the open-ended financial assistance power in Clause 4, which might mean that GBE will not be required to make a financial return.
Another operating principle is that of additionality, by prioritising investments where there is an undersupply of private sector finance. The noble Baroness, Lady Noakes, asked whether additionality applied to GBE at Second Reading but did not receive a suitable answer, and I have raised this principle a number of times, including in the previous group. It would be helpful if the Minister spoke a little about the expectations for additionality for GBE. It is another fundamental question that Parliament ought to be informed about before allowing this Bill to become law.
Another section of the framework document sets out investment principles. It describes the kinds of investment that are to be undertaken and those which are not allowed. Not only must individual investments support its core objectives, they must also be intended to deliver a positive financial return, and to crowd in significant private capital. We have no idea what the guiding principles for investments made by GBE are. There is also a lot in the framework document on governance and other matters.
The key questions are whether we will see a framework document and when. I would not go as far as the noble Baroness, Lady Noakes, in Amendment 121A, which would delay commencement, but it is essential that we see a framework document as early as possible. Given the lack of detail in the Bill, it is important that the company should have to do that. I beg to move.
Viscount Trenchard (Con)
My Lords, I rise to follow the noble Lord, Lord Vaux, in speaking to Amendment 93, which he moved on behalf on my noble friend Lady Noakes. I have also added my name to this amendment.
As has been said several times in our debates, this is in essence a framework or enabling Bill but one that gives a large number of Henry VIII powers to the Secretary of State. A requirement to produce a framework document setting out the operating and financial principles that GBE will use would be a significant improvement to the Bill, as the noble Lord, Lord Vaux, explained so eloquently. It is essential that the principles underpinning the relationship between the Secretary of State and GBE should be publicly understood and supported. The arguments that I have previously used in relation to my Amendment 86A also apply here; other relevant public bodies, as mentioned in that amendment, clearly include GBN, NWF, NESO, Ofgem and Mission Control.
I also support my noble friend Lady Noakes in her Amendment 121A, which I think is justified in the circumstances, but I would certainly like to hear the Minister’s view on it. Amendment 121A would ensure that the framework document is laid before Parliament before the Act comes into force.
Earl Russell (LD)
My Lords, I shall speak briefly on this group of amendments.
I generally give my support to Amendment 93. I understand that these things are being done quickly and urgently to get GBE established and that the Government need to get that done, but there is a general lack of detail in the Bill and we do not have the framework agreement. If the Minister could update the Committee on where that framework document is and what stage it is at, that would be useful. In the interests of trying to find a compromise and a way forward on these issues, I do not know whether it might be possible for the Minister to provide the equivalent of heads of terms or to say something from the Dispatch Box about what he would expect the framework document to cover or to send us an outline of what is likely to be in that document. We are keen to support the principles of this Bill, but the Bill is extremely short and lacks detail.
On the other side of the fence, there is a slight feeling that we are being asked to approve things without knowing what it is we are approving. If it were possible to find a way forward on these issues before Report, that would be appreciated, but I am interested to hear from the Minister what stage these documents are at and what impediments there may be beyond the Minister’s control in these matters.
Lord Offord of Garvel (Con)
My Lords, I thank my noble friend Lady Noakes, in her absence, for her amendments in this group. In fact, this amendment, Amendment 93, ties closely with Amendment 125 in my name, which would ensure that this Bill does not come into force until a financial framework document has been published. Together, these amendments address an essential issue in the governance of GBE: the need for proper financial oversight and clear frameworks that ensure that this body is held accountable. That is the reason why I support Amendment 93 and why it is so critical to the Bill—because it would require the Secretary of State to prepare a framework document that sets out not just the operating principles but the financial principles through which GBE will pursue its strategic objectives.
Without this clear framework, GBE would operate without the financial clarity and accountability required to protect public funds and to ensure that GBE’s financial practices align with the UK’s broader energy strategy. A financial framework is not just a bureaucratic detail; it is fundamental because the energy sector is complex and fast-moving. GB Energy will be responsible for substantial public investment. Without this financial framework, there is a risk of financial mismanagement and inefficiency or lack of transparency. The framework simply provides clear guidelines on budgeting, expenditure, revenue generation and risk management; it also ensures that GBE’s financial decisions align with the Government’s energy and climate goals, such as achieving net-zero emissions and maintaining energy security.
Lord Hunt of Kings Heath (Lab)
My Lords, I am grateful to the noble Baroness, Lady Noakes, and the noble Lord, Lord Vaux, who spoke in her absence. As the noble Baroness raised earlier on in our debates, her amendment inserts an additional clause requiring the Secretary of State to prepare and publish a framework document setting out the principles underpinning the relationship between the Secretary of State, my department and other relevant public bodies and also requires financial and operating principles to be included in that document.
Lord Vaux of Harrowden (CB)
In effect, under the Bill GB Energy will take a chunk of the activity of the National Wealth Fund—approximately a third of the total value, in fact—and put it into another entity. As I said, the National Wealth Fund’s framework document includes quite a lot of information around requirements to make financial returns and, in particular, the additionality principle. Therefore, because we are, in effect, moving a chunk of the National Wealth Fund’s activities into a different entity, it would presumably be appropriate that that remains subject to fairly similar levels of governance and control. Could the Minister perhaps say a little about the expectation on financial returns and additionality, which he has not mentioned in his response so far?
Lord Hunt of Kings Heath (Lab)
My Lords, by implication, we would expect the organisation to be as transparent as possible and to cover the sort of areas that the noble Lord mentioned. It is also fair to say that, given the comparisons being drawn between Great British Energy and the UK Infrastructure Bank, in the case of the UKIB, the framework document was published before Royal Assent. The point is that the organisation was operational before Royal Assent, but this Bill is being brought to Parliament before we have operationalised the company, so there is a distinction. As I said, noble Lords can be reassured that there will be a stringent framework document to ensure proper accountability. I am searching to find something else to say to give comfort, but I have to say that this is as far as we can go. Having said this from the Dispatch Box, it has to happen.
Returning to the part of the amendment that would require the relationship between GB Energy and other relevant public bodies to be included in the framework agreement, noble Lords will know that that is not typically part of a framework document, but GB Energy’s relationship with relevant public sector bodies will of course be part of delivering its objectives. Again, the partnerships will be undertaken in accordance with GB Energy’s operating principles and, where appropriate, we will provide definition to those relationships in the upcoming statement of strategic priorities. As part of its annual reports and accounts, we will of course expect GB Energy to report on activities undertaken as part of its public sector partnerships. We expect it to enter into a number of partnerships or relationships with other public bodies, but that is not appropriate for the framework document.
The other point to make here is that GBE will be accountable to Parliament, with a statement of strategic priorities laid before Parliament, and the accounting officer of Great British Energy, and Ministers, will be accountable to Parliament for the work and performance of the company. Members of your Lordships’ House will be able to ask questions and debate, and I have no doubt that Select Committees will wish to examine the chair and chief executive of the organisation from time to time, which seems wholly appropriate and will provide the public accountability that needs to go alongside the normal accountability that a private company would expect to operate, within the legislation that it will be covered by. We need to remember that it is also publicly accountable alongside the accountability that it needs to discharge as a private company.
The issue I come back to is that we have to ensure that it has enough operational independence. A push-back from noble Lords might be to ask: will it be overly constrained? We have to get the balance right between proper accountability and reporting and—dare I say it —what I hope will be an entrepreneurial approach to the formidable task it is being given. That is why the appointment of the incoming chair has been so important —to give us that expertise and experience.
As noble Lords will see, it is very difficult for us to agree to Amendment 121A, which would defer commencement of most of the provisions in the Bill until a framework document had been laid before Parliament. We do not think it possible to produce a framework document without the active involvement of the company itself. That is probably as far as I can go on this interesting area, but I can assure noble Lords that there will be a fully fledged framework document, which I think will cover all the issues that noble Lords are concerned about.
Lord Vaux of Harrowden (CB)
My Lords, I thank all noble Lords who have taken part in this short debate, and the Minister for his response, which is helpful and encouraging—I understand his point. However, I think he put his finger on the fundamental problem with the Bill, which is precisely what he said: the company is being established before we really know what it is going to do and before it starts to operate. Therefore, there is no scrutiny of those things at the moment. When he says that there is accountability through, for example, the statement of strategic priorities, it is not strictly true. It gets laid before Parliament, but there is no debate, approval or anything. The framework document will not even be laid before Parliament.
Lord Hunt of Kings Heath (Lab)
My Lords, of course, that is a fair point but, equally, I would say, as a Minister accountable to Parliament, that the opportunity for noble Lords to ask questions and take part in debates is considerable. I would expect that GBE and any statement of priorities will be fully part of the rough and tumble of life in Parliament. Anyone who has been involved in a company organisation such as that will know that parliamentary accountability really does bite and is effective.
Lord Vaux of Harrowden (CB)
The Minister is right on that—I cannot disagree—except, again, that accountability is only as good as the information on which one bases it. If there is no information, or if it is really thin, it is hard—
Lord Hunt of Kings Heath (Lab)
My Lords, I do not want to intervene constantly, but I think noble Lords will be awash with information about GBE, its performance and activities.
Lord Vaux of Harrowden (CB)
I am very encouraged to hear that but there is nothing in the Bill that says that. If one is honest, what tends to happen is that if something is really successful, we will be awash with information telling us how successful it has been. If it is less than successful, I wonder how much information we will see. Fair enough, but there is a wider discussion to be had between now and Report on transparency and accountability, and I hope the Minister will be open to that. With that, I beg leave to withdraw Amendment 93.
Lord Offord of Garvel
“Review of effective delivery(1) The Secretary of State must appoint an independent person to carry out reviews of the effectiveness of Great British Energy in—(a) delivering its objects under section 3,(b) meeting its strategic priorities under section 5, and(c) complying with any directions given under section 6.(2) After each review, the independent person must—(a) prepare a report of the review, and(b) submit the report to the Secretary of State,as soon as is reasonably practicable after the completion of the review.(3) The independent person must submit to the Secretary of State—(a) the first report under this section within the period of 12 months beginning on the day on which this Act comes into force, and(b) subsequent reports at intervals of no more than 12 months thereafter.(4) On receiving the report, the Secretary of State must, as soon as is reasonably practicable in each case,—(a) publish the report,(b) lay a copy of the report before Parliament, and(c) prepare and lay before Parliament a response to the report’s findings.(5) In this section, references to an “independent person” are to a person who appears to the Secretary of State to be independent of—(a) the Secretary of State, and(b) Great British Energy.”Member’s explanatory statement
This amendment would require that the Secretary of State appoints an independent person to review the effectiveness of Great British Energy in delivering its objects, meeting its strategic priorities, and complying with its directions.
Lord Offord of Garvel (Con)
My Lords, I shall move Amendment 94 and speak to the amendments in this group, which, once again, address the review, scrutiny and governance of a publicly owned company.
It is alarming that so many in this House have had to table so many amendments to ensure that GB Energy undergoes proper independent review and governance. We find ourselves in the unfortunate position in which provisions to ensure the thorough review and governance of GB Energy are missing from the drafting of the legislation. This is rather strange. Why should publicly owned companies, funded by billions of pounds, not be subject to reviews by independent bodies or have to report on their successes or failures? The incoming chair himself has stated that “independently run” will mean “excellent governance” and that he will ensure that this is the case, but how? Although the Minister claims that these amendments, which would indeed ensure excellent governance, do not need to be included in the Bill, I strongly disagree. He claims that there will be many opportunities for review by the Secretary of State and, ultimately, for the usual sort of public scrutiny, but how will this be the case when the Bill does not include a single measure that requires GB Energy to be reviewed or allows for public scrutiny?
I am not alone in questioning the lack of governance to which GB Energy is presently subject. Marc Hedin, head of UK and Ireland research at Aurora Energy Research, also asked:
“what are the governance arrangements to ensure that Great British Energy carries out its duties and focuses on its remit? ”.—[Official Report, Commons, Great British Energy Bill Committee, 8/10/24; cols. 20-21.]
Amendment 94 in my name seeks to address this shortcoming. It requires the Secretary of State to appoint an independent person to review the effectiveness of GBE in delivering its objects, meeting its strategic priorities and complying with its directions. The amendment is closely aligned with Amendment 103, in the names of the noble Lords, Lord Vaux of Harrowden and Lord Cameron of Dillington, and my noble friend Lady Noakes. While demanding an independent review of the success or failure of GB Energy in achieving its objects, the amendment neatly requires a review of the company’s impact on private investment.
I draw your Lordships’ attention to Section 9 of the UK Infrastructure Bank Act, entitled, “Reviews of the Bank’s effectiveness and impact”. Under that section,
“The Chancellor of the Exchequer must appoint an independent person to carry out reviews of … the effectiveness of the Bank in delivering its objectives”,
and the results must be laid before Parliament. If the UK Infrastructure Bank—now known as the National Wealth Fund—has to undergo an independent review of its performance, why should GBE not face the same? It does not make sense. The Great British Energy Bill is almost a carbon copy of the UK Infrastructure Bank Act but with one glaring difference: provisions to ensure sufficient governance.
I hope that the Minister has listened carefully to the concerns I have raised and will be receptive to the worries other noble Lords will undoubtedly raise on this issue. I beg to move.
Lord Vaux of Harrowden (CB)
My Lords, I rise to speak to Amendment 103, and thank the noble Baroness, Lady Noakes, the noble Lord, Lord Cameron of Dillington and the noble Viscount, Lord Trenchard, for their support. As we have heard, once again we are returning to transparency and accountability.
Amendment 103 is similar to Amendment 94, which has just been introduced by the noble Lord, Lord Offord, but with some important differences. As we have discussed before, and as the noble Lord, Lord Offord, has just mentioned, most of this Bill has been copied across from the UK Infrastructure Bank Act, but with most of the transparency and accountability provisions removed. In particular, Section 9 of that Act, which provides for independent reviews of the effectiveness and impact of the bank—now the National Wealth Fund—has been omitted.
The Minister has previously explained that the reason for this omission was that no such reviews were included in the Energy Act in respect of Great British Nuclear, and he feels that this is the precedent which should apply here. That argument holds no water at all. Great British Nuclear is a completely different entity, with completely different activities. It has a clearly defined and specific role initially to administer the process to select which small modular reactor technology the UK will choose. It has a relatively small budget—I think it was £157 million initially—and it is not intended to invest directly in those technologies. Great British Nuclear has an important role, but it is very different to what is apparently planned for GBE.
GBE will, in effect, take over a substantial and important area of the National Wealth Fund’s activity, investing directly in projects and businesses. It has an initial budget of £8.3 billion, which is nearly a third of the National Wealth Fund’s budget. It is worth reminding noble Lords that there is no limit in the Bill on how much public money GBE can spend. Indeed, the activities of GBE and the National Wealth Fund are so close that, initially, the National Wealth Fund will carry out the activities of GBE on its behalf, so let us drop this pretence that GBE is like Great British Nuclear; it is not. GBE is taking over a part of the National Wealth Fund’s activities and has a substantial budget. A body with the ability to spend billions of pounds of public money should be subject to rigorous transparency and accountability, and not just to the Treasury and the Secretary of State. It must, therefore, be appropriate for GBE to have to follow at least equivalent accountability disciplines to the National Wealth Fund. It is doing very similar things.
Amendment 103 is an almost direct copy of the independent review process that the National Wealth Fund is subject to. That arose from lengthy debate during the passage of the UK Infrastructure Bank Act and was supported by the Minister’s party at the time. It is not clear why, in government, they have decided to omit it from the Bill. Accountability seems to be a good thing, so long as it does not apply to them.
For GBE, I have changed the provision slightly from how it is in the UK Infrastructure Bank Act, in two ways. I have limited the scope to reporting only on how GBE has met its objectives and how well it has encouraged private sector investment alongside its activities. This latter point—additionality—is critical, as I have mentioned before. I do not have time to get into the details of crowding-in and crowding-out theory, but if all that GBE does is invest in projects which could easily have been financed by the private sector, that would be a complete waste of taxpayers’ money. Indeed, it would be actively damaging, as it would undermine the emergence and growth of a thriving industry providing the finance for our move to net zero.
We had lengthy discussions around the additionality principle during the passage of the UK Infrastructure Bank Act. I asked the Minister to comment on it in a previous group. He has still not commented in any detail, but it is critical. I would like to hear from the Minister what the expectations of GBE are in that respect. The Government have stressed the importance of it, and I have referred previously to the £1 of public money capitalising £3 of private investment that has been claimed. Crowding in is fundamental to its success, so it should be part of the measurement and review of GBE’s performance.
The second tweak I have made to the section from the UK Infrastructure Bank Act is on timing. The 2023 Act requires that the first independent report should be after seven years and then every five years. Infrastructure is by nature long-term, so those timeframes made sense in that context. However, GBE is intending to have decarbonised the power sector by 2030, in just five years’ time, so we should logically be reviewing progress before then. I have suggested reporting every three years; that is probably the major difference between my Amendment 103 and Amendment 94 of the noble Lord Offord, which proposes an independent report every year. I think an annual independent review is probably unduly onerous, but we need an independent progress review before the end of the target period of 2030, so I hope that three years is an acceptable compromise. However we do it, as currently drafted, the Bill falls woefully short on transparency and accountability.
I hope that the Government look seriously at having an independent review of effectiveness. It was hard-wired into the UK Infrastructure Bank Act for good reason: routine annual reports and accounts are simply not a good vehicle for a deep dive into the effectiveness of what are often quite complex investments and other financial activities. A separate, independent review was a good idea for what is now the National Wealth Fund, and I cannot see how a valid distinction can be made between the two organisations. The Government should want to ensure that they both operate equally effectively. Again, I would be very happy to discuss this further with the Minister and I hope that he is receptive to strengthening these aspects of the Bill, just as he and his party, when sitting on the other side of the Chamber, were on other Bills including the UK Infrastructure Bank Bill.
I say in passing that I support Amendment 102 of the noble Earl, Lord Russell, which requires a biennial report on GBE’s relationship with other public sector bodies. We have talked about this previously and it is another example of the opacity that currently surrounds GBE. In particular, I have no idea what its relationship with the Crown Estate means in practice, as well as that with Great British Nuclear and the UK Infrastructure Bank. It would be very desirable to have reports on how those relationships would work.
Viscount Trenchard (Con)
My Lords, I support my noble friend Lord Offord’s Amendment 94, to which I have added my name. I have also added my name to Amendment 103 in the names of the noble Lords, Lord Vaux and Lord Cameron, and my noble friend Lady Noakes.
The noble Lord, Lord Vaux, made the same point that I tried to make on Monday much more eloquently than I did: GBE and GBN are not comparable institutions. Unfortunately, it seems that the Minister’s department does not recognise that. I refer to the Explanatory Notes at page 6, paragraph 22. The power to give directions in the hands of the Secretary of State
“is consistent with the power that the Government has to direct comparable institutions, for example: the Department for Energy Security and Net Zero has a statutory power to direct Great British Nuclear, although, to date, this has never been used”.
I repeat the point made by the noble Lord, Lord Vaux, that, despite what this says, I cannot think that they are comparable institutions.
Both Amendments 94 and 103 require an independent person to carry out a review of GBE’s effectiveness. Of the two, I prefer Amendment 103, which requires the independent person to review the extent to which investments by GBE have encouraged private sector investment in those projects. Amendment 94 requires an annual independent review, whereas Amendment 103 requires such a review only once every three years. Perhaps we could compromise at two years.
I have also added my name to Amendment 102, in the name of the noble Earl, Lord Russell. This requires GBE to report on its relationships with other connected bodies and is, to some extent, similar to some of the other amendments we have debated. It is obviously a requirement of working together on strategic objectives and directions that GBE should maintain excellent relationships with its stakeholders. One of the ways to achieve that would be by adopting the noble Earl’s amendment, and I look forward to hearing him speak to it and to hearing the Minister’s response.
Earl Russell (LD)
My Lords, I rise to speak to my Amendment 102 in this group, which concerns independent review and governance. It would insert a new clause after Clause 7 on Great British Energy stakeholder relationships. To be honest, it is a bit of a probing amendment and one that is looking for a bit of reassurance from the Minister.
The amendment argues:
“Within one year of the day on which this Act is passed, and every two years thereafter, Great British Energy must publish a report regarding its relationship with … Great British Nuclear … the Office of Gas and Electricity Markets (Ofgem) … National Energy System Operator (NESO) … the UK Infrastructure Bank … the Crown Estate”.
Obviously, it is essential that Great British Energy publishes reports and that these are available. It is important that we have a good understanding of how Great British Energy is working in practice. That involves understanding how it is establishing its working relationships alongside other partners and fulfilling its missions and goals, as we work towards net zero. It extends to objectives and joint projects and asks, “What problems are happening?” These are all key issues in the energy transition, which is itself a complicated business that involves lots of partner organisations and joint and crossover responsibilities. This is already a crowded space—or a tangled web, if you like—in which Great British Energy is being created. Indeed, the delivery of GB Energy’s goals will happen only if the new organisation builds strong and lasting relationships that develop well and help create both joint working and good outcomes.
I want to say a word about the Crown Estate Bill, if I may. It is the cornerstone of GB Energy’s relationship with the Crown Estate; their partnership was announced on the same day that GB Energy was created. Clearly—certainly for the initial part of GB Energy’s life—that partnership will be about developing floating offshore wind with the Crown Estate. As part of the Crown Estate Bill, an amendment was agreed in order that the Crown Estate produces an annual report on its relationship with GB Energy. So that is already happening on the Crown Estate side. I ask the Minister to give an assurance that, from the Government’s point of view, there is no reason why that requirement would not be mirrored on GB Energy’s side. I cannot see one; it seems like common sense to me. As others have said, reporting is a general issue running across this Bill.
I note what the Minister has said today in relation to group 10. I also note what he has said about the possibility for ongoing parliamentary scrutiny. Ministers are responsible, of course, for example at Question time. As the Minister has confirmed today at the Dispatch Box, GB Energy will be subject to scrutiny by all the Select Committees across both Houses of Parliament, but it is important that these relationships are reported on via an annual report. I would like to hear some reassurance from the Minister on that.
I turn briefly to the other amendments in this group. As we have heard, Amendment 94 in the names of the noble Lord, Lord Offord of Garvel, and the noble Viscount, Lord Trenchard, would require the Secretary of State to appoint an independent person to review annually the effectiveness of Great British Energy in delivering its objectives, meeting its strategic priorities and complying with its directions. The independent review would be required to cover Clauses 3, 5 and 6 of the Bill.
I would be interested in the Minister’s response to this amendment. My worry is that this would be overly burdensome for the organisation. I am not certain that I was able to find another comparable organisation where these conditions applied, so my concern is whether we are asking for something that is not on a level playing field with other, similar types of organisations. I note as well that strategic directions can be given and, as I said, there are also other methods of scrutiny, so it would be the Minister’s right, at any point, to give the strategic direction for that to happen.
Amendment 103 in the name of the noble Lord, Lord Vaux of Harrowden, would require an independent review of the effectiveness of Great British Energy in achieving its objectives and the extent to which it had encouraged private investment. But this would be every three years. I was interested to hear what the noble Lord said in relation to the UK Infrastructure Bank. Again, my worry is whether this is a level playing field, but I was interested that the noble Lord said that that is part of that organisation and how it works. That makes me more inclined to lend support to his amendment.
Lord Vaux of Harrowden (CB)
I am sorry to interrupt the noble Earl. This was lifted directly, almost word for word, from the relevant legislation, the UK Infrastructure Bank Act.
Earl Russell (LD)
I thank the noble Lord. I would be keen to hear what the Minister has to say in response to that amendment.
Lord Hunt of Kings Heath (Lab)
My Lords, this has been a very interesting debate and I am grateful to noble Lords for what they have said. I will start with Amendment 102, tabled by the noble Earl, Lord Russell, and supported by the noble Viscount, Lord Trenchard. As he said, the amendment focuses on Great British Energy’s relationships with its key stakeholders and would require the company to publish a report every two years detailing its relationship with a number of named public bodies.
As I have already said, we of course expect and want Great British Energy to enter into a number of partnerships or relationships with other public bodies. This will include public bodies beyond those highlighted by the noble Earl, including, for example, those operating in the devolved Administrations—although I agree with him very much about the importance of the relationship with the Crown Estate.
I think it was implied in what I said earlier that we are absolutely certain, as part of the rigorous reporting requirements that the organisation will need to take part in through its annual reports and accounts, that it will report on activities undertaken as part of these partnerships. That seems to me a perfectly sensible request, which I can affirm readily. In view of that, I am not sure that you need a separate report, but we can make it very clear to GBE that we expect it to report on this regularly. We have already publicly committed to setting out how Great British Energy and the National Wealth Fund will collaborate and complement each other. I can assure noble Lords that we have made the same commitment on Great British Energy’s relationship with Great British Nuclear.
In terms of Great British Energy’s relationship with Ofgem and the National Energy System Operator, again, we would expect GBE to be subject to the same legal and regulatory frameworks as other entities. Clearly, when it comes to the Crown Estate, I readily say that, of course, GBE will report on its relationship, just as the noble Earl said. The Crown Estate will be doing similar, and we hope that there will be a consistency of approach in their reports. I am sure that there will be.
Turning to Amendments 94 and 103, which would require independent reviews of Great British Energy’s effectiveness, I thank the noble Lords, Lord Offord, Lord Vaux and Lord Cameron, and the noble Baroness, Lady Noakes, for putting their names to them. We all agree that Great British Energy needs to be accountable, transparent and clear about how it is delivering against its objectives and the statement of strategic priorities. The Bill already ensures that GBE will provide regular updates through its annual reports and accounts. These documents will be laid before Parliament, ensuring public accountability. Clause 5 provides that GBE must “act in accordance” with the priorities set out by the Secretary of State. To ensure this, Great British Energy must publish a strategic plan on how it will deliver those priorities, and it will update this plan regularly.
On the question, generally, of a review, I certainly understand the point that noble Lords have made and agree that reviews are important. I am prepared to consider the principle of a review between Committee and Report. I would not want to get into a debate about how regular those reviews should be. It is important that GBE has a good run before it is subject to such a review. Equally, I do not think you want a review happening on a regular annual basis because that would detract from its ability to perform effectively, but I understand the principle of a review. I will take this away without commitment at this stage, but I am happy to talk to noble Lords between now and Report about it.
Coming back to additionality, we obviously agree that it is an important principle, and we would expect Great British Energy to learn from the UKIB/National Wealth Fund approach. Of course, GBE has rather a wider role than the National Wealth Fund, particularly in that it is not just an investor but a developer, and it has an important future role to play in trying to get rid of some of the barriers to investment that we have seen in the energy sector.
Having said that, I think additionality will be covered. Equally, we accept that undertaking reviews from time to time is important. But they should not be done so frequently that they lose impact in what they are there to do. I hope noble Lords will accept that I have tried to be constructive in my response to these amendments.
Lord Offord of Garvel (Con)
I thank noble Lords for their contributions to the debate on this group, and I thank the Minister for listening to these concerns, which, as always, are to do just with the review and governance of GB Energy for it to be held to rigorous and proper account. I thank the Minister for considering how he deals with this. In the meantime, therefore, I beg leave to withdraw the amendment.
Earl Russell
“Budget report(1) Great British Energy must publish an annual budget report and send it to the Energy Security and Net Zero Committee, or any successor Committee, of the House of Commons.(2) This report must include but is not limited to—(a) a breakdown of current and expected funding sources;(b) spending per sector;(c) grid spending;(d) future spending;(e) estimations of future profitability.(3) A representative of Great British Energy must appear before the Energy Security and Net Zero Committee, or any successor Committee, if requested by the Committee.”Member’s explanatory statement
This amendment requires GBE to publish an annual budget report.
Earl Russell (LD)
My Lords, in moving Amendment 95, I will speak also to my Amendments 96 and 97, on accountability to Parliament. This group is all about GB Energy reporting to Parliament. As I have said, the Bill is quite short and some bits are missing, so I think noble Lords are just looking for as much reassurance as the Minister can give on these matters.
As the Bill stands, there are no real basic requirements for GB Energy to produce an annual report, or requirements for it to report to Parliament, beyond those in Clause 7 and what the Minister has said at the Dispatch Box today. I note that GB Energy will be subject to the same general reporting as other arm’s-length government organisations.
My Amendment 95 would ask GB Energy to publish an annual budget report, which would be sent to the Energy Security and Net Zero Committee or a successor committee of the House of Commons. That report must include but not be limited to,
“a breakdown of current and expected funding sources … spending per sector … grid spending … future spending … estimations of future profitability”.
It goes on:
“A representative of Great British Energy must appear before the Energy Security and Net Zero Committee, or any successor Committee, if requested”.
Amendment 96 says:
“Great British Energy must publish an annual report and send it to the Energy Security and Net Zero Committee, or any successor Committee, of the House of Commons”,
and that that report
“must consider Great British Energy functions and activity in the contribution to the following … supporting local communities and economies … the achievement of the United Kingdom’s climate and environmental targets … the relationship with The Crown Estate … a just transition to green energy … a jobs and skills transition into the green economy”.
It would also provide that Great British Energy must appear before that committee if requested.
Amendment 97 would require GB Energy to commit to an ongoing sustainable development review of its activities. It states:
“Great British Energy must keep under review the impact of their activities on the achievement of sustainable development in the United Kingdom”.
This would require GB Energy to keep under constant review the impact of its activities on sustainable development goals, as recognised by the United Nations, the Commonwealth and other bodies that refer to human rights developments, which aim to meet the economic, environmental and social needs of the present, while also ensuring the ability of future generations to meet their own needs.
At the outset I acknowledge to the Committee that my amendment is a direct copy of one tabled by the noble Baroness, Lady Hayman, and so skilfully negotiated with the noble Lord, Lord Livermore, the Financial Secretary to the Treasury, as part of the Crown Estate Bill. It was agreed as a government amendment to that Bill as it left your Lordships’ House. I wish to put on the record my thanks to both of them for their work in getting the amendment into the Bill. My reasons for bringing the amendment here again are, as I said, simply to mirror the other Bill, because the two organisations are so closely interlinked. For me, this is a minimum backstop amendment. I have added my name to Amendment 116, in the name of the noble Baroness, Lady Hayman, and I continue to support it, but I wish to make clear that if that amendment falls, this one is a kind of backstop.
My amendments are relatively straightforward, so I will turn to the other amendment in this group, Amendment 117, in the name of the noble Baroness, Lady Bloomfield of Hinton Waldrist. This would hold Great British Energy accountable to the relevant parliamentary committees of both Houses of Parliament.
The Minister has said—I already suspected that this would be the case with an arm’s-length body—that this would be subject to parliamentary scrutiny. It is good that he has confirmed that from the Dispatch Box. I just wanted to indicate my full support for the amendment and the principles that it sets out. It is obviously important that all bodies that the Government set up should be subject to parliamentary scrutiny from the Select Committees.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, I shall speak to the amendments in this group, which contains amendments in my name and those of the noble Earl, Lord Russell, one of which he moved. I thank the noble Earl for introducing this group; I appreciate the sentiment and spirit of his amendments, and his support for mine.
I do not wish to repeat noble Lords’ arguments from previous groups, but these amendments again seek to shape the governance, accountability and sustainability of the proposed Great British Energy entity. They have been drafted in line with the values of responsible governance, fiscal prudence and national interest, so, although I will not repeat his arguments, or those of my noble friend Lady Noakes from earlier, I wholeheartedly agree with the comments made by my noble friend Lord Roborough on the first group.
On Amendment 95, which would require GBE to publish an annual budget report, I appreciate the sentiment of ensuring transparency in how public funds are utilised. On these Benches, we have always championed the prudent use of taxpayers’ money, and this amendment acknowledges that principle. However, we must ensure that such reporting is not merely a box-ticking exercise. The report must provide meaningful insights, ensuring that GBE operates efficiently and delivers value for money. We cannot allow an additional layer of bureaucracy to stifle innovation or create unnecessary costs. Therefore, I agree with the noble Earl, Lord Russell, on the spirit of this amendment, and I look forward to hearing from other noble Lords about how the reporting requirement could best be used to ensure that GBE operates in the best interests of the nation.
Lord Hamilton of Epsom (Con)
My Lords, I, too, speak in support of these amendments. It is definitely important that accountability is brought to bear here. Of course, one has the constant worry that the private sector is going to pick up all the low-hanging fruit, which is quite profitable, while GB Energy is going to be left with all of the much more speculative stuff, which will probably lose money for the taxpayer.
I want to refer in particular to subsection (2)(d) in the new clause to be inserted by Amendment 96 in the name of the noble Earl, Lord Russell, which refers to
“a just transition to green energy”.
I use that as a bit of a hook on which to return to the question I asked in Committee on Monday; I should have intervened and asked the Minister to answer before he sat down, but I had a problem at that stage, which is why I have given him advance notice today. I hope that the Minister will be able to answer my question for me because there is a dispute on our side. My noble friend Lord Fuller is a great exponent of green liquid hydrogen. Let us face it: if we could manufacture it effectively, it would be a bit of a silver bullet in solving many of these problems. But, at the same time, my noble friend Lord Roborough said that it will always be much too expensive to produce. I was slightly surprised by this because, like my noble friend Lord Fuller, I have always taken the view that the technology will develop as it goes along and the price will start to come down. It used to be the policy of the previous Government to support hydrogen; it is certainly supported by JCB.
Lord Ashcombe (Con)
I thank my noble friend for letting me speak. I wish to correct the record: it was actually me who described what my noble friend is describing, not my noble friend Lord Fuller.
Lord Fuller (Con)
Although I do of course wish to be associated with those remarks.
Lord Hamilton of Epsom (Con)
I cringe, with apologies to my noble friend Lord Ashcombe; I did not realise that it was he who said it. Anyway, whoever said it, I very much supported the view that it might well be possible for the price of liquid hydrogen to come down as the technology developed and got better.
My noble friend Lord Roborough said to me that it was always going to be expensive. I said that it was being manufactured by wind turbines in the North Sea at the moment, but as we have already discussed, the problem with wind is that it is intermittent. The wind gets turned off every now and then, the windmills do not turn, and electricity is not generated. Apparently, it is very expensive to replace all the filters, and so forth, and you need to have a constant supply of electricity to produce hydrogen.
What is felt about this on the Opposition Benches does not really matter; what matters is the attitude that the Government are taking towards liquid hydrogen and whether this is something that Great British Energy will be investing in or not. I would be grateful if the Minister would tell us where the Government stand on liquid hydrogen, as it is an important component of having clean energy for this country.
Lord Petitgas (Con)
My Lords, I also support these amendments aimed, like others, at greater accountability and transparency of the delivery of GBE. In particular, I support Amendment 95 in the name of the noble Earl, Lord Russell, on budgets. It is all very well to check on delivery and ask for more reports, but you only get what you measure. It needs to be set against a budget and objectives. I have found the objectives in the Bill to be a little vague. I am therefore in favour of Amendment 95 to the extent that it will allow us to set reporting and disclosure against a set of objectives, and a certain budget. I would also add additionality in there, as that is the only way to understand whether the delivery has been effective.
Lord in Waiting/Government Whip (Lord Cryer) (Lab)
My Lords, I will begin with Amendments 95 and 96 in the name of the noble Earl, Lord Russell.
Amendment 95 proposes requiring GBE to publish an annual budget report and send it to Parliament through the Commons Energy Security and Net Zero Select Committee—or its successor, as he said, since its name seems to keep changing every five minutes. Amendment 96 proposes requiring GBE to publish an annual report on various topics which must also be sent to the Select Committee. GBE will already have a requirement to produce publicly available annual reports and accounts at Companies House, and the Secretary of State will lay copies before Parliament.
The noble Earl, Lord Russell, also mentioned the requirement that the Secretary of State appear before the Select Committee to speak to those reports. That requirement is already fulfilled. I know that Select Committees cannot subpoena witnesses, so there is no compulsion, but the Secretary of State and other Ministers regularly appear before relevant Select Committees. I emphasise other Ministers with specific interests. Once GBE is up and running, and producing these accounts, that is the time when the Secretary of State will appear before the relevant Select Committees. In theory, the Secretary of State does not have to appear—as I said, there is no compulsion—but it would be pretty odd if they did not do so under those circumstances.
There are also additional requirements on government-owned companies to ensure transparency and accountability. These include the obligation to follow the Treasury’s directions on accounts through the powers extended in the Government Resources and Accounts Act 2000, and laid out in the Government Financial Reporting Manual and related “Dear Accounting Officer” letters. Furthermore, GBE will be required to report on its governance around, exposure to, and risk of, climate-related scenarios in its operations as set out by the Task Force on Climate-Related Financial Disclosures a couple of years ago.
I acknowledge the noble Lord’s expectation that Parliament will hold a strong interest in the performance of GBE, which anybody who knows anything about how Parliament works would expect. I fully anticipate that the relevant Select Committees will call representatives from the company and from the department to provide evidence when required.
The point about hydrogen made by the noble Lord, Lord Hamilton, is a little wide of the scope of the amendment. However, I remind noble Lords that the exact mix of technologies in which GBE, as an operationally independent company, chooses to invest will be determined by its board in due course. His prediction—he is inviting me to look into the future, and I suppose he is doing the same—is that, as technology advances, hydrogen starts to fall in cost. That is fairly sensible, although I do not ask the noble Lord to hold me to it, because we are looking into the future and we do not know what technologies there will be then.
Amendment 97 proposes that GBE reviews the impact of its activities on sustainable development in the UK. This Government—this has been made very clear and repeatedly so—firmly believe in a healthy natural environment and that is critical to a strong economy and to sustainable growth and development. Our commitment to the environment is unwavering and will be in the future, including through meeting the Environment Act 2021 targets and halting biodiversity decline by 2030. That is a pretty demanding target, but that is what we have set out for five years’ time. I assure the noble Earl that the projects in which GBE is involved will be subject to the usual and rigorous planning and environmental regulations, where the impacts on the environment and habitats are considered. The Bill focuses on establishing the company, and adding more detail at this point may restrict its activities or add layers to its reporting and governance.
Amendment 117, proposed by the noble Baroness, Lady Bloomfield, seeks to legislate the scrutiny of GBE by relevant Select Committees. My noble friend and I have touched on that to some extent. This amendment goes beyond the precedent and practice of the involvement of Select Committees in public appointments. The chief executive of Great British Energy, once appointed, will also be its chief accounting officer and will be accountable to Parliament for their stewardship of GBE and its funds. As is common practice for public bodies, the management and leadership of GBE will be available to the relevant Select Committees as needed. There is no real need to legislate on this arrangement at this point.
I remind noble Lords that the chief accounting officer would, in all likelihood, be called before the Public Accounts Committee. Over the past few years, the PAC was chaired by Margaret Hodge, as was, who is now the noble Baroness, Lady Hodge; she was followed by the honourable Member for Hackney South and Shoreditch. Those who have seen those sessions know what an acute and thorough grilling that committee gives to anybody who appears in front of it. That Select Committee is always chaired by a Member of the Opposition; that is set up in the Standing Orders of the House of Commons. It is now chaired by the honourable Member for Cirencester and Tewkesbury. Having served with him in the other place for more than 20 years, I assure noble Lords that he will be just as incisive as his predecessors.
The Cabinet Office guidance on pre-appointment scrutiny by House of Commons Select Committees provides criteria and processes for such roles. It sets out that decisions on the scrutiny of individual posts should be made between the Secretary of State, the chair of the relevant Select Committee and the Cabinet Office. It is not common practice for this to be set in primary legislation. As per this guidance, no public body currently appears to have its full board subject to that kind of pre-appointment scrutiny. We anticipate recruitment for the substantive board to begin over the course of this year and will ensure that it is undertaken in a manner that aligns with best practice. To reassure the noble Baroness—
Earl Russell (LD)
I am sorry to intervene, but I think the noble Lord has moved on to the next group of amendments in his response to me, unless I am mistaken, because the next one is on government appointments, is it not?
Earl Russell (LD)
I thought the noble Lord had moved on; I apologise for interrupting.
Lord Cryer (Lab)
I am glad I was able to reassure the noble Earl. I hope that I have provided the assurances and explanations sought by noble Lords in tabling these amendments, and I sincerely hope that they will not press them.
Lord Hamilton of Epsom (Con)
May I press the Minister a bit harder on green hydrogen? If my noble friend Lord Roborough is right and, whatever happens, it will be much too expensive to produce, then we surely have to look elsewhere. What is the Government’s attitude towards liquid hydrogen as a fuel for the future?
Lord Cryer (Lab)
I am grateful to the noble Lord for that question. I cannot add anything to what I said before. GBE will look at a range of technology and sources. The whole of energy policy is predicated on security of supply and range of supply, because at various times in British history, although those two things have not been absent at the same time—or perhaps they have, briefly—there have been times when one or the other has been absent. If it is possible for hydrogen to play a part in that security of supply and range of supply—it certainly would on the latter—I do not see why that should not be part of the nation’s energy supply in the future.
Earl Russell (LD)
I thank all noble Lords who have taken part in the discussion on this group of amendments, and I thank the Minister for responding to me; I apologise for interrupting him. I appreciate everything he said, and I appreciate that there will be reports on GB Energy and that there are lots of opportunities for parliamentary scrutiny. It is appropriate that we ask these questions. The amendments in this group and others look to go a bit further to ensure that certain things will be reported on.
In response to the discussion on the previous group, the noble Lord, Lord Hunt of Kings Heath, asked me whether we were looking for a separate report. In my mind, this is about making sure that GB Energy produces a really good-quality annual report that covers a broad range of areas and is open and transparent about its activities.
Lord Hunt of Kings Heath (Lab)
Perhaps I may intervene. In the discussion on the first group of amendments, I promised to write a letter to noble Lords focused on financial information. It might reassure noble Lords if I pick up that challenge and say that we should perhaps also try to encompass the annual report arrangements. If that would be a sensible way forward, the letter will set this out very clearly in writing so that noble Lords can see it after Committee but before Report.
Earl Russell (LD)
That would be greatly appreciated and would really reassure us. That was the point that these amendments were trying to get to, so I thank the Minister.
Lord Frost
“The Chair of Great British Energy(1) The Chair of Great British Energy may not be appointed until the appointment has been scrutinised by the Treasury Committee of the House of Commons, or any successor committee.(2) The Chair of Great British Energy must be based full-time at the headquarters of Great British Energy in Aberdeen.(3) The Chair of Great British Energy must undergo an annual review on their performance and—(a) this review must be carried out by external auditors;(b) this review must be submitted to the Secretary of State and laid before Parliament.”Member’s explanatory statement
This would require the Chair of Great British Energy to undergo pre-appointment scrutinisation, to be based at Great British Energy’s headquarters full-time and to undergo an annual review of their performance.
Lord Frost (Con)
My Lords, in moving Amendment 98 I will also speak to Amendment 99 in my name. As it is the first time I have spoken in Committee, I take this opportunity to declare an interest as the director of the company Net Zero Watch.
I have a couple of preliminary remarks before turning to the text of the amendments. These two amendments very much echo themes that we have been debating at length over the last day or two. They are amendments to make up for the lack of detail in the Bill and to ensure, as my noble friend Lady Noakes pointed out the other day, that this company is subject to the same degree of scrutiny that large public companies would expect to face. With the Bill, we are creating a company with precious little oversight or scrutiny as normally understood in company law, and with an idiosyncratic version of the normal governance and accountability arrangements that go with a normal company. Of course, this fact is why nationalised public companies are typically so badly run.
The only detail we have had on the ground covered by these two amendments is in the founding statement, which says:
“Led by its own CEO, Great British Energy will be overseen by an independent fiduciary Board, rather than ministers, benefitting from industry-leading expertise and experience across its remit. Trade unions will also have a voice and representation within Great British Energy”.
Although Ministers both here and in the Commons have commented on that, they have not gone beyond what that statement says, and we are still left rather unclear about how these arrangements are to work, other than to say that normal company law will apply. As I say, that is not quite enough, and these amendments are designed to fill the gap here.
I turn to the text of the amendments. Amendment 98 is designed to set out a few minimum requirements for the themes that we have been talking about: transparency and accountability. Amendment 98 would make clear that there must be a chair and, more importantly, that the appointment of the chair would require a degree of parliamentary scrutiny, in this case by the Treasury Committee. As has been noted, we have already trespassed slightly on this ground, and the Minister noted that this degree of scrutiny would be going beyond precedent. He read out the Cabinet Office guidance on this subject, which is interesting but not decisive for this House and the legislators.
Certainly, the degree of parliamentary scrutiny is dictated by the very political nature of this job, and quite a political figure has been appointed to it as the current chair. He has not been shy in giving us his ambitions for the company. He told the Guardian on 17 October that he thought it should become a “national champion” and
“a longer-term operator in … areas, such as floating offshore wind”.
I do not know whether that is the Government’s view of the development of GB Energy—it might or might not be—but they are statements by the chair and, by making them, he is coming into the arena of political debate about the company. Therefore, some sort of political process in his appointment seems logical. I cannot help noting that he has made broader reflections on politics, populism and progressivism, and he has been a quite a critic of Brexit in the past. Of course, he is entitled to have these opinions but, once you get into the political field, you must expect to face a degree of political scrutiny of your appointment. That is why this amendment would require such public scrutiny.
Similar thoughts are behind the other part of this amendment: the requirement for a publicly available review of performance against the purposes of GBE, and that this should be done independently. Once again, we come back to the point that has been touched on at length: that this is an unusual company and that normal accountability mechanisms are not there. There is only one shareholder, the content of the board is uncertain and, as it stands, there is no requirement in the Bill for directors of any kind at all—although I will come on to Amendment 99. This is a public company, fulfilling absolutely classical public goals, so there must be accountability to the public in how it is run.
Proposed new subsection (2) would require the chair to be based full time at the headquarters of the company, which has been said to be Aberdeen. The Government have made a virtue of that fact, at some length, when talking about GBE. They also confirmed, in October, that the new chair would be based in Manchester. It is not unusual for a non-executive chair to be based somewhere else, but the current chair role is not exactly a non-executive one; it is quite hands on. I struggle to see how one can run the company in quite that way.
The Government say that he will
“regularly spend time in Aberdeen”.
That is good and important, obviously—but this is a new company. It needs leadership as it is built up. If the taxpayer is going to get value for money out of the chair, his salary and the process, he should be where the company is when he is working.
I wish to record that Amendment 99 is a copy of an amendment tabled by Andrew Bowie MP and debated in the Commons—although perhaps it was not fully debated. Again, this comes back to the fact that we are dealing with an unusual company. What is being created is, in many ways, more like an executive arm of HMG than a genuinely independent company. The description that the Minister just gave about the role of the CEO rather confirmed that. It sounded much more like the role of the Permanent Secretary of a department, responsible to Parliament as accounting officer, than the role of a genuine CEO of a company.
The Bill is literally silent on appointment processes, content of the board and so on. The amendment is designed to fill that gap, to give clarity on numbers, and to make it clear that there must be non-executives as well as executives, that there must be a CEO as well the chair, that there can be no repeated appointment beyond defined limits and so on. That is a bare minimum. There already are some provisions in the Bill connected with the articles of association, so the line of principle about what is right to include in the Bill and what is not has already been passed. I hope that, with that in mind, the Minister will consider that these are serious amendments designed to deal with potential weaknesses in the corporate governance and accountability of GB Energy. I look forward to hearing his response.
Earl Russell (LD)
I shall speak to my Amendment 101, and I thank the noble Viscount, Lord Trenchard, for adding his name in support of it. It would simply prevent the board of GB Energy from being appointed until each prospective appointment had been scrutinised by the Energy Security and Net Zero Committee. I believe in pre-appointment scrutiny, and I put this forward as a way of helping to ensure that that happens.
I shall not speak for long on this amendment, because I suspect that it will not win favour with the Government and that the Minister will argue that there are well-established processes and procedures for making such appointments. It might be useful if he could say a brief word about what those processes will be.
Amendment 99 is very similar to mine on pre-appointment scrutiny, so I lend my support to it. However, I would probably leave out the politics; I am much more interested in the skills and abilities people have to perform the functions that they undertake. Their personal politics should not really come into it.
Amendment 98, in the name of the noble Lord, Lord Frost, and the noble Viscount, Lord Trenchard, has three elements. The first reflects my amendment in this group. The second calls for the headquarters to be placed full time in Aberdeen. The third calls for the chair of GB Energy to undergo an annual review by external auditors, and for that review to be sent to the Secretary of State.
I cannot disagree with the first part, because we are kind of on the same ground, so I welcome it. Labour made commitments on the second part, but I am not certain that the Bill is the place to go into what a full-time headquarters is and how it should be defined, so I will park that. On an annual review by external auditors, my question is again about level playing fields. Would other people in other similar organisations find that that was part of their normal working relationship with their employment contracts? I suspect that they would not. If the answer is no, there is no precedent for putting it in the Bill, so I would not think it acceptable.
Lord Offord of Garvel (Con)
My Lords, I will speak to the two amendments in this group regarding the appointments of the chairman and board of Great British Energy. These amendments, in the names of my noble friends Lord Frost, Lady Noakes and Lord Trenchard, attempt to fix a glaring omission from the Bill as it stands. As drafted, there is no mechanism to govern the appointments process of the chairman and the board, and this is a concern as we have heard on many occasions that GB Energy will be responsible for £8.3 billion of taxpayers’ money. Those at the top of the company will have enormous responsibility and therefore it is paramount that adequate scrutiny is given to these appointments.
My noble friend Lord Frost has attempted to address these concerns with his amendments in this group. Amendment 98 requires the chairman of GBE to undergo pre-appointment scrutiny in front of the Treasury Committee. This amendment has not come out of the blue: it is exactly the same process as the appointment of the chairman of the Office of Gas and Electricity Markets, otherwise known as Ofgem, which is the regulatory authority for the energy sector. Once the Secretary of State appoints the chair, they must appear before the House of Commons Energy Security and Net Zero Committee. This is also the case for the chairs of the Climate Change Committee and the Nuclear Decommissioning Authority. The Commissioner for Public Appointments keeps a list of significant appointments, which details the public bodies of which the chairs must undergo pre-appointment scrutiny by Parliament. There are no fewer than 40 current chairmanships of public bodies for which this appointments procedure applies.
There is clearly precedent for the chairmen of significant public bodies with responsibility for large sums of public money to be subject to pre-appointment parliamentary scrutiny. If this is the case for these three other public bodies with responsibilities in the energy sector, why should the chair of GBE not also be subject to the same pre-appointment parliamentary scrutiny process?
The Bill also fails to detail the procedure for the appointments and tenure of the directors of Great British Energy. As drafted, there are no requirements for the composition of the board, no limits on the number of directors that may be appointed and for how long a director may serve on the board, and no statutory duties to be conveyed on the board. The amendment from my noble friend Lord Frost plugs this gap.
Once again, there is precedent for having this level of detail regarding appointments to the board of a major public body. The Utilities Act 2000, which created Ofgem and which—we must not forget—was passed by the last Labour Government, did exactly that. Schedule 1 to that Act lays out, for example, that:
“An appointment of a person to hold office as chairman or other member must be for a term of not less than 5 years and not more than 7 years”.
So that Act includes details of the tenure and the appointments of the chairman and the board, yet the Bill does not. I ask the Minister why Labour thought it pertinent to specify the executive composition of Ofgem but does not believe it necessary to do the same for Great British Energy.
Viscount Trenchard (Con)
My Lords, I congratulate my noble friend Lord Frost on his two amendments in this group, which deal with the governance of GBE. There is, as has been said in previous debates, almost nothing in the Bill about the corporate structure of GBE or how it will be managed. I welcome my noble friend’s proposals to require that the chair should be full time and be required to attend the office in Aberdeen, from which it follows that he must be based there. That would also ensure that the person will be fully committed and be a real check on the powers of the chief executive, who may need oversight in interpreting the priorities and actions needed in response to directions received from the Secretary of State. My noble friend’s proposal that the board must comprise at least five and no more than eight directors makes perfect sense and provides for the assembly of a group of people with the appropriate skills and experience.
I have also considered and support Amendment 101 in the name of the noble Earl, Lord Russell, which requires scrutiny of any proposed appointments by the Energy Security and Net Zero Committee of another place. That committee should ensure that an appropriate balance of skills and experience among the directors is maintained at all times.
Lord Vaux of Harrowden (CB)
My Lords, I was not going to speak on this, but I just point out very quickly that the other Act that has a clause that is not quite the same but similar to Amendment 99 is the UK Infrastructure Bank Act. As I have already pointed out, that is the really analogous organisation to Great British Energy, so it must be appropriate, I think.
Lord Hunt of Kings Heath (Lab)
My Lords, I am grateful to the noble Lord, Lord Frost, for initiating the debate on his Amendment 98, where he proposes to place a number of requirements on the role of the chair of the board of Great British Energy. I agree that the chair, the board and the chief executive officer have major responsibilities. I must say to him though that I do not recognise GBE as being an executive arm of my department. It is very interesting that he said that, because the noble Lord, Lord Teverson, made the interesting remark on Monday that there is a risk in having too many controls and reporting arrangements in relation to GBE, detracting from what we need it to do. We do want it to have operational independence, albeit working within the context of Clauses 3 and 5 of the Bill, the requirements under the Companies Act and the accountability arrangements I have already referred to. We need very highly skilled people at the top of GBE to find their way through this in order to ensure that it actually delivers on the things we want it to deliver on.
At the risk of inviting the noble Lord, Lord Hamilton, to intervene, I take his point about winners and Governments: this is the whole point of having an organisation that is not part of government—but, of course, it is owned by government—and being able to really get on with the job that needs to be done.
I will address pre-appointment scrutiny of the chair in relation to Amendment 101 soon. Amendment 98 requires the chair to be a full-time position based at the headquarters of Great British Energy in Aberdeen. I must say that it would be highly unusual to specify that a company’s non-executive chair should be full time or based formally at an organisation’s headquarters. Looking at the Grand Committee, almost all noble Lords here have taken roles as chairs or non-executive directors of organisations that can be based very far from where they are resident. Frankly, if we were to adopt this principle, we might inhibit the appointment of high-calibre people, notwithstanding that Aberdeen is a very fine place to live and work, as I know from the experience of having a family member working in the offshore oil and gas industry from there.
I do not think that a full-time chair is appropriate; I think it is perfectly appropriate to have a part-time, non-executive chair in that role, as the noble Lord, Lord Frost, has already remarked. Having an interim chair does not preclude having a very lively presence—and a jolly good thing too. I do not think we should insist that that should be a full-time role.
My main board experience is in the public sector, in the National Health Service, and I have been around in the NHS for long enough to know the problem of chairs who come in on a daily basis and inhibit the proper role of the chief executive. I would be wary of encouraging that development in GBE; I am sure that it will not happen.
Again, in relation to the annual review of the chair’s performance by external auditors, which is to be laid before Parliament, first, we will of course ensure that there are annual performance reviews for Great British Energy’s chair. This aligns with best practice followed by other public bodies, and my department is well used to doing this in relation to a number of the bodies it oversees. The review will typically be performed by a senior official in the sponsoring department, supported by the senior independent director on the board, who will have deep insight into the chair’s performance over the year.
Of course, there will also be regular meetings between the responsible Minister and GBE, as there is in my department between Ministers and other organisations, as would be expected. In a sense, these are also part of the accountability mechanism. However, I acknowledge the expectation of the noble Lord, Lord Frost, that Parliament will have a strong interest in the chair’s performance. I fully anticipate that the relevant Select Committees will call on them on a regular basis to provide evidence and, of course, I fully expect the chair of GBE to accept those committee’s invitations.
Amendment 99, also in the name of the noble Lord, Lord Frost, would place certain requirements on the composition of Great British Energy’s board. As noble Lords have said, it largely replicates provisions in the UK Infrastructure Bank Act. We made clear in our founding statement that GBE will be an operationally independent company, overseen by an independent board. We do not think that it is necessary to legislate these provisions, since established governance documents, such as the UK Corporate Governance Code and the Governance Code on Public Appointments, already apply.
The UK Corporate Governance Code, published by the Financial Reporting Council, sets out best practice in relation to corporate governance. Although it applies formally to listed companies only, it is standard practice for government companies to comply with it or, where they do not, explain why. The Governance Code on Public Appointments provides clear guidance for ministerial appointments, which are regulated by the Commissioner for Public Appointments and should be followed even where roles are not formally within the scope of the commissioner. I can give an assurance from the Dispatch Box that Great British Energy will comply with these codes, ensuring best practice in corporate governance.
GBE will also be required to follow corporate governance best practice to help guide the composition of its board. This will have an impact on the number of directors required at each stage of GBE’s development and operation. We think that, having given those assurances, there needs to be a degree of flexibility at this stage about how GBE goes forward in relation to the composition of its board. The noble Lord’s amendment would also place standard requirements on when an individual should cease to be a director. I can assure him that such provisions already exist, including in the Companies Act 2006, and that they will, as is common practice, be replicated in GBE’s articles of association.
Amendment 101 in the name of the noble Earl, Lord Russell, proposes to require all appointments by GBE to be scrutinised by the Energy Security and Net Zero Committee in the other place before they come into effect. This is similar to new subsection (1), proposed by Amendment 98. Noble Lords will know that Cabinet Office guidance on pre-appointment scrutiny by House of Commons Select Committees provides clear guidance on the criteria and process to be used in these circumstances. It sets out that decisions on the scrutiny of individual posts should be made between the Secretary of State, the chair of the relevant committee and the Cabinet Office. It is not common practice for this to be set in primary legislation.
The guidance gives the criteria of the types of roles which may be in scope. Importantly, it sets out the principle that the posts which require pre-appointment scrutiny are, most typically, the chair or equivalent of the organisations. None of the roles identified in the guidance as requiring pre-appointment scrutiny are in government-owned companies of the kind that GBE will be. No public body currently appears to have its full board subject to pre-appointment scrutiny. Where individual roles are scrutinised, it is done following agreement between the Secretary of State and the committee chair.
From our point of view, the calibre of Great British Energy’s director appointments will be of great importance. We want GBE to succeed, so we want the highest calibre of people to be appointed as chair, to non-executive positions and to the chief executive officer role. We anticipate that recruitment for the substantive board will begin over the course of this year, and we will ensure that recruitment is undertaken in a manner which aligns with best practice. I can assure the noble Earl, Lord Russell, and the noble Lord, Lord Frost, that in line with Cabinet Office guidance, any relevant public appointments to Great British Energy will be discussed with the appropriate Select Committee chair. I hope that I have been reassuring regarding this.
Lord Frost (Con)
My Lords, I thank the Minister for his comprehensive and understanding response, and I thank other noble Lords who spoke in support of these amendments. I have two very quick points in response.
First, I note what the Minister says about the likely degree of independence of Great British Energy. We will have to see how that turns out, but I make the point, which was not really dealt with in his response, that there will always be an area where the company thinks that something is operational, but the Government believe it is political. That is where it is important to have clarity on relationships and how accountability works, so I am not entirely persuaded that the Bill gets this right at the moment, but I hear what he says.
Lord Hunt of Kings Heath (Lab)
I am not sure that you can legislate for this. I understand what he says, because as Ministers, we have relationships with a number of key bodies at the moment. We have formal relationships, there are accountabilities, reports and meetings, but we also build up trust, understanding and working closely together. It is difficult to legislate for that. In saying that we want GBE to work, it has to feel operationally independent, or it is not going to work. We cannot micromanage it, but on the other hand, we are setting the tramlines in the context in which it operates. It is hard to go much further than that, in reality.
Lord Frost
Obviously, there is a degree of judgment and practice in how these things are done. There is also a degree of judgment on the extent to which it is desirable to fix the framework within which these judgments and relationships operate, which is probably the area of disagreement.
On the question of where the chair is based, the amendment may not be perfectly drafted. I think there is a difference between “based at” and “resident at”. The point of this amendment is to make sure that the business of the company, when transacted by the chair, is very firmly in Aberdeen, the HQ of the company, and not dragged elsewhere by the fact that the chair may not be resident there. This may not perfectly deal with that point, but it is an important point all the same, so I welcome the Minister’s comments on it. I will reflect on whether any of this is necessary at Report, because it is part of a wider discussion, but for the time being, I beg leave to withdraw the amendment.
Lord Offord of Garvel
“Annual report: impact on coastal communities(1) Within 12 months of the day on which this Act is passed, and annually thereafter, Great British Energy must annually report on the impact of their activities on coastal communities.(2) The Secretary of State must lay a copy of these reports before Parliament.”Member’s explanatory statement
This would require Great British Energy to annually report on the impact of their activities on coastal communities.
Lord Offord of Garvel (Con)
My Lords, I rise to speak to my Amendments 106 and 107 in this group and to support my noble friend Lady Bloomfield’s Amendment 118. These amendments are closely aligned with Amendments 27, 28 and 29 in the name of my noble friend Lord Effingham, which were debated on the first day in Committee. Amendment 106 introduces a new clause that ensures that Great British Energy must annually report on the impact of activities on coastal communities. Amendment 107 similarly requires GB Energy to report on its impact on commercial fishing.
The Government have committed to substantial wind developments, promising to double onshore and quadruple offshore wind by 2030. It goes without saying that there is a difficult balance to strike when undertaking considerable developments while minimising the damage to the communities and industries that are most likely to be affected. That said, we must not lose sight of the communities and sectors to which GB Energy’s activities may be costly. I remind noble Lords that the Government have said that GB Energy will work closely and collaboratively with local communities to achieve their clean energy targets. I therefore see no reason why they should not consult and report on the impact of its functions on the communities they suggest will reap the rewards of GB Energy.
The impact of GB Energy’s activities and the Government’s green energy agenda on communities throughout the UK has been a recurring theme and a point of serious concern throughout the debate on the Bill. Last year, I highlighted the burden facing rural communities in particular, as the Government looked to ramp up transmission and distribution infrastructure. It is essential that the energy transition, and GB Energy’s role within it, do not come at the expense of the communities and associated industries.
Many in this House urged the Minister to ensure that the Secretary of State and GB Energy consult local communities. I point to the noble Baroness, Lady McIntosh of Pickering, who rightly raised concerns that offshore wind development risks forcing fishermen out of the seas in which they operate. It is essential that we carefully consider the use of our country’s marine space. Preliminary results from the Plymouth Marine Laboratory concluded that all the proposed offshore wind farms in the UK are predicted to impact fishing, with fishermen pointing to both financial and safety concerns resulting from the construction and operation of offshore wind farms. Ultimately, this is an issue of spatial competition.
Amendment 115 of the noble Lord, Lord Teverson, is broader, addressing the impact of GB Energy’s activities on both fishing and commercial shipping. He is right to extend the scope to commercial shipping. I turn to the UK Harbour Masters’ Association, which notes the challenges faced by the sector from offshore renewable energy installations. It calls for a report on the impact of such installations on the shipping industry and insightfully draws a link with commercial fishing, noting that fishing vessels may be squeezed out of their usual channels and enter shipping routes to avoid sites of renewable energy generation. We must not ignore the worries and recommendations of these industry bodies. With this in mind, many environmental, biodiversity and wildlife bodies have called for GB Energy to deliver for nature alongside climate. I welcome and support my noble friend Lady Bloomfield’s Amendment 118, which requires GB Energy to make
“a positive contribution to nature recovery”.
Careful consideration is key to the success of GB Energy. We must not isolate but include those communities and sectors that will be most impacted by the Government’s attempts to create this green energy superpower. Additionally, we ought to consider how GB Energy will act in a way that seeks to benefit both the climate and biodiversity, which are inextricably linked.
I look forward to hearing the contributions of all noble Lords in the debate on this group of amendments, and the Minister’s response.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, Amendment 118 in my name would introduce a new clause which requires GB Energy and its partners to make only investments that make a positive contribution to nature recovery. As my noble friend Lord Offord of Garvel rightly explained, the UK is facing both a climate and a nature crisis.
Nature recovery, the restoration of our country’s biodiversity and the climate are matters that are so closely interwoven. They cannot and should not be considered in a separate capacity. Therefore, if GB Energy is to be established in an effort to achieve clean energy by 2030 and net zero by 2050 and to reduce the UK’s carbon emissions in an attempt to tackle climate change, GB Energy ought to operate in a way which looks to make a positive contribution to nature recovery.
The Government themselves recognised the ties between climate and nature recovery. Indeed, they were elected on a manifesto which said:
“The climate and nature crisis is the greatest long-term global challenge that we face”
and
“The climate crisis has accelerated the nature crisis”.
The omission of a nature recovery duty is another shortcoming of the Bill. Climate change and the loss of biodiversity both compound and reinforce one another. The Royal Society has acknowledged that a flourishing ecosystem has the ability to combat the effects of climate change. We know that the UK’s biodiversity is under serious threat, yet we know that natural habitats have a significant role to play in absorbing and storing carbon and regulating the climate.
Wildlife and Countryside Link has called for nature recovery to be put in the Bill and the amendment in my name would do just that. It recognises that restoration of the UK’s nature has the ability to provide up to a third of the climate mitigation effort that is required if we are to achieve net zero by 2050. Rightly, it describes the Government’s failure to include a nature recovery duty as a “missed opportunity”.
A nature recovery duty ought to be a general principle of GB Energy. It would hold the Government to account on the manifesto they were elected on. It would introduce a clear condition, ensuring that GB Energy and its partners operate in a way which seeks to contribute to the biodiversity targets introduced by the previous Government in the Environment Act.
Nature recovery must not be seen to inhibit the facilitation of the production, distribution and storage of clean energy. Instead, it must go hand in hand with the objectives of GB Energy, helping to protect and restore carbon-rich habitats. Indeed, it is complementary to the objectives of GB Energy surrounding clean energy generation and distribution.
We must be cautious that the establishment of this body to rapidly ramp up the installation and generation of renewable energy technologies does not adversely affect biodiversity in the UK. We must seek to mitigate the risk of further diminishing or undermining the UK’s natural assets. The amendment in my name would do just that by embedding a nature recovery duty into law.
Lord Teverson (LD)
My Lords, I shall speak to my Amendments 114 and 115. I agree very much with the spirit of the other amendments in this group. I say to the Minister that only one of my amendments is labelled as a probing amendment but they are both, in effect, probing amendments and I would not expect them to proceed beyond Committee as I have written them.
Amendment 114 is about national defence. Clearly, even since I wrote the amendment, this has become even more important in terms of offshore infrastructure, as we saw in the Baltic at the end of last year and following the serious shenanigans of “Eagle S”, the shadow Russian oil tanker which disrupted cables in the Baltic Sea, after which there was a NATO conference yesterday.
The purpose of this amendment is to hear from the Minister that GB Energy, in its offshore investments, will be plugged into the Ministry of Defence, and that the Ministry of Defence—which, if I may be slightly candid about it, has not always been positive about renewable energy onshore—will fully engage in these investments.
I think this is going to get more and more important. All sorts of technologies are coming out to ensure that, as soon as cables or pipelines are tampered with, it is quickly recognised and action can be taken. There is an Oral Question on this area in the House tomorrow, and I will be pressing more on the defence side, as we need to be a little more upfront in our reaction, as the Finns have been. I am really probing to see where that co-ordination with the Ministry of Defence is going to happen.
Lord Hamilton of Epsom (Con)
My Lords, I am a little confused by this conversation, because I always understood that oil rigs encouraged shoals of fish, providing them with a safe haven under which they thrived. If they thrive under oil rigs, why should they not thrive under wind turbines as well, if they are pinned to the bottom of the sea?
I agree that, if they are floating ones, it is more debatable whether fish could thrive under them, but, in my view, it does not necessarily follow that having such industrial structures in the sea goes against nature—it might actually go some way towards protecting it.
Lord Teverson (LD)
The noble Lord raises an important issue. As we know, when Shell wished to dispose of one of its oil rigs in the North Sea, to which a number of environmental NGOs strongly objected, there was a fair bit of scientific evidence that it made a positive contribution to North Sea biodiversity. Indeed, off the coast of Cornwall, an ex-naval vessel was sunk in order for it to become a reef, which increased biodiversity. We should not just reject the fishing industry’s views on this. The problem with offshore wind farms compared with oil rigs is the quantity—that is, the size of the area that would be an exclusive zone. That is the issue, but I take the noble Lord’s point.
Lord Hamilton of Epsom (Con)
I am grateful for the noble Lord’s intervention. May I take him up on his point about the Ministry of Defence, which I used to work for at one stage? He said that the people there were very much against such schemes, but I think that it is mainly to do with communications: if their radar and other communication systems are blocked by wind turbines, they will object to them. That is understandable. We should not paint the Ministry of Defence into the position of being anti all forms of renewable energy because I do not think it is; however, it is always concerned if it cannot reach out and listen to the enemy, wherever they may be, because there are wind turbines in the way. This is an interesting subject that probably needs looking into rather more carefully—it is certainly not as straightforward as some of my noble friends make out.
Lord Teverson (LD)
I shall not prolong the conversation tonight but the noble Lord is, once again, absolutely right about national defence, radar and being able to see an incoming attack with missiles or whatever. The problem was that the Ministry of Defence did not man that area enough. Decisions were extremely slow. There was a rumour—of course, I have no proof of this —that it used to use its slowness and its objections to insist that developers helped it upgrade its military equipment. I do not know whether it was true—I am sure that it was not, of course—but that was the perception. The main problem was the slowness of response.
Earl Russell (LD)
My Lords, I rise to speak to my Amendment 118A, which covers wider considerations. Let me be clear: it is also a probing amendment, as are all the amendments in this interesting and diverse group. I thank the noble Lord, Lord Macpherson of Earl’s Court, for adding his support to my amendment, which is about ensuring that communities benefit directly from the renewable energy projects that Great British Energy undertakes. I put it forward to see whether that is possible and to ask, from the Government’s point of view, what barriers to that might exist.
My amendment would ensure that 5% of gross revenue from all Great British Energy
“renewable energy projects generating over one megawatt”,
both onshore and offshore, would
“be paid into community benefit funds”.
The idea for it came from the honourable Angus MacDonald MP’s experience with Scottish Government Good Practice Principles for Community Benefits from Onshore Renewable Energy Developments. This guidance promotes community benefits of a value equivalent to £5,000 per installed megawatt per annum, index-linked for the operational lifetime of projects.
My amendment requires that:
“Within six months of the day on which this Act is passed, the Secretary of State must prepare and lay before Parliament a report setting out proposals for ensuring that local communities benefit from renewable energy projects undertaken by Great British Energy. The report … must set out, but is not limited to, proposals for 5% of the gross revenue from all such renewable energy projects generating over one megawatt to be paid into community benefit funds”.
I will not go into the rest of the details; the amendment is before noble Lords. It simply puts into the Bill that local communities should directly benefit from renewable energy undertaken, and that there is a mechanism available for doing that. On the 5% figure, I am happy to have a conversation with the Minister if it is an issue. I note that Denmark’s Law on the Promotion of Renewable Energy 2008 had a 20% figure, in relation to which 5% is a lot lower.
To talk more about the spirit of the amendment, this is really about helping disadvantaged communities, particularly those that are hosting our renewable energy. A lot of them are in the highlands and in Scotland. They disproportionately suffer from poor infrastructure and poor public services, and a lot of them are living in fuel poverty. They are putting up with having their landscapes covered in turbines, dams, electricity transmission lines, substations and all the rest of it. I support community energy, as everybody knows—I have spoken to it in two other amendments and will not go into it here—but this is about more than that. This is not a nice-to-have; in my opinion, this is an essential part of the energy transition. It is about ensuring the continued long-term support for this journey that we are undertaking as a society.
Recent opinion polls on these matters are really strong. Where local communities benefit from the energy infrastructure, particularly the infrastructure that they host, their support for this transition is much stronger and more resilient. If this support falls away, that could be the end of the whole transition and of all this, so this is not just about being fair and supporting the communities that need it most and that host this stuff. It is also about making sure that these things go on beyond one Government and one term, that they are here, that we manage to take society with us on this journey, and that those who are hosting things that other bits of society need benefit from them.
Turning to the other amendments in this group, I signal my support for Amendment 118 in the name of the noble Baroness, Lady Bloomfield. I note that the Wildlife and Countryside Link put out a detailed briefing on that and why it needs to be there. I also support Amendments 114 and 115 in the name of my noble friend Lord Teverson. I will not go into too much detail on that. As he said, there is an Oral Question on this tomorrow. It is unfortunate that we have had more recent incidents, not just in the Baltic but off the coast of Taiwan. Obviously, the UK has a number of electricity interconnectors and gas pipelines —we had a conversation about gas in the House this week—and they will only ever increase. New contracts have been signed. We have about 7.7 gigawatts at the moment, and that will rise to 18 gigawatts by 2032, so this is a crucial part of our energy security and our journey to net zero.
I would ask the Minister one thing. We can have conversations about the other aspects later on, but I am worried about the Government going away, stepping up their appreciation of this risk and maybe recalculating some of their calculations around the security of supply as we transition to net zero in 2030 and beyond. Is there is a greater need to look at some of those things again? We will talk about the rest tomorrow.
If the Committee will excuse me, the noble Lord, Lord Macpherson of Earl’s Court, has left me a note. Does the Committee mind if I read that in support of my amendment?
These are his words: “My Lords, I would like to speak in support of Amendment 118A. I should first declare an interest as a director of two family-owned hydroelectric companies in Wester Ross. Having worked in the Treasury during the 1980s boom in North Sea revenues, I am all too conscious that Britain has a poor record in reinvesting the benefits of energy windfalls and an even worse record in passing on those benefits to communities directly affected by energy production. I think Shetland receives some money, but other places do not”.
“It is in the nature of renewable energy production that it tends to take place in remote areas. I am thinking in particular of the Highlands of Scotland, but the same applies to Cornwall, Devon, Wales and Cumbria. People living in these communities often have to live with negative aspects of renewable energy: towering windmills or hydroelectric schemes which change the natural environment and can particularly scar a hillside. Because of the remoteness, oil and gas and electricity connections cost more”.
“Successive Governments in Westminster and Edinburgh have supported the principle of requiring energy developers to support their local communities, and there have been some good examples of community investment. But practice is variable, and often contributions are set in cash terms and bear no relation to the subsequent success of renewable energy schemes. Great British Energy has a huge opportunity to lead by example in exercising best practice. By setting up community benefit as a fixed percentage of gross revenue, this amendment seeks to ensure communities benefit more fairly. A 5% contribution is relatively modest, as I understand it”—and he then goes on to make the Denmark point.
“Of course I hope that the noble Lord the Minister will agree to the amendment, but I have a feeling that he will argue that this amendment will cut across the operational independence of Great British Energy and that this Bill is the wrong vehicle for addressing community benefits. If that is the case, I would like to ask the Minister if he can go beyond fine words of general support for community benefits. Will he commit to setting out a clearer definition of what represents a reasonable and fair rate of community benefit for a given level of revenue for renewable energy projects?”.
Lord Cryer (Lab)
Before the Minister responds, I should have pointed this out before, but I was not aware: reading out speeches from another Member is not acceptable, according to the Companion. That is partly my fault. I apologise: I should have said something.
Earl Russell (LD)
I apologise; I thought that it was acceptable. The noble Lord should have intervened earlier if it was not. I would not have done it if I had known that it was not acceptable, so I apologise to the Committee.
Lord Hunt of Kings Heath (Lab)
We certainly got the noble Lord’s point.
This has been an interesting debate with which to finish today’s proceedings. I start with Amendments 106, 107 and 115. The debate between the noble Lords, Lord Teverson and Lord Hamilton, on the benefits of oil rigs and other structures for fish populations allows me to say that other energy infrastructure can also have a positive impact on nature. We know, for instance, that wind farms can coexist with farmland easily. We have examples of solar meadows, which is a practice of growing wildflower meadows on solar farms. I have heard talk of green corridors, where beautiful new pylons are built to extend the grid. I am not being facetious here, as we need to look at ways in which energy can contribute to nature recovery. It is an important point to make.
I agree on the importance of our coastal communities and commercial fishing, as reflected in Amendments 106 and 107. Amendment 115 would require GBE to consult annually with the commercial shipping sector and fishing industry. I would expect GBE to provide regular updates on its work on such issues through its annual reports and accounts. We know that the projects that Great British Energy is likely to be involved in will all be subject to relevant regulations, including environmental impact assessments. There will be statutory stakeholder engagement to understand the potential impact of development. In line with other energy developers, GBE will consider the impact and risk of its activity on the commercial shipping sector and fishing industry, as it will other affected stakeholders. I will draw these remarks to the attention of the chair of GBE, so he can understand the importance of the issue that the noble Lord, Lord Offord, has raised.
In relation to coastal communities, there will be many opportunities in the energy sector in the future. We talked about the challenge of the North Sea transition. We obviously hope that, as jobs reduce in the oil and gas sector, the people involved can take up other jobs, some of which I hope will be in the wider energy sector. But overall, GBE has an important contribution to make in this area.
On Amendment 114, the noble Lord, Lord Teverson, raised an important point on the Ministry of Defence and security agencies. Clearly, to ensure resilience, GBE will have to consider the impact and risk of its activity on offshore installation, including its pipeline and cable connections, within the context of relevant security regulations and hostile state action. It is a very important and serious matter. All nationally significant infrastructure projects, which include projects in the energy sector over 50 megawatts, undergo rigorous scrutiny to monitor and mitigate security risks. In the end, these decisions fall to Ministers to make in relation to development consent orders.
There was an interesting debate on air defence issues between the noble Lords, Lord Teverson and Lord Hamilton. I have to say that my department is working very closely with the Ministry of Defence on these issues. We are talking closely and working to ensure that our own offshore wind ambitions can coexist alongside air defence. MoD programme NJORD will deliver an enduring radar mitigation solution, which will prevent turbines from interfering with MoD radar systems. In the context of our more general working relationship with the Ministry of Defence, it will be a responsibility of GBE to consider and consult relevant stakeholders. My department will of course ensure that that happens appropriately.
Amendment 118, tabled by the noble Baroness, Lady Bloomfield, would place a nature recovery duty on Great British Energy. Let me say at once that we are absolutely committed to restoring and protecting nature and meeting our Environment Act targets. We want GBE to focus on its core mission to drive clean energy deployment, but I assure the noble Baroness that the projects that GBE invests in and encourages will be subject to all environmental and climate regulations, in the same way that every other company is.
I draw her attention to our recently published Clean Power 2030 Action Plan, which dedicates an entire section to
“Integrating clean power and the natural environment”.
I was going to quote from it, but I do not think I need to do now. We are launching an engagement exercise in 2025 to invite communities, civil society and wider stakeholders to submit their ideas on how we can best encourage nature-positive best practice into energy infrastructure and development. Feedback from this exercise will allow the Government to better understand how we can integrate nature restoration through the clean power 2030 mission. We very much agree with the substance of what the noble Baroness said.
Lord Teverson (LD)
As the Minister will know, terrestrially, there is now biodiversity net gain, which came through the Environment Act and is applied to terrestrial developments. I do not think this is for the largest of them yet, but that is due to happen. I understand it is the Government’s intention to introduce marine biodiversity net gain regulations. I presume GBE will be subject to those.
Lord Hunt of Kings Heath (Lab)
My Lords, I am going to have to take advice on that as I do not have the information. However, if there are regulations which apply to companies, GBE will be expected to comply, and to act consistently with general government policy towards biodiversity. I will write to him about that in some detail.
On community benefits, I take the point of the noble Earl, Lord Russell, and other noble Lords. In our manifesto, we committed to ensuring that communities which live near new clean energy infrastructure projects can directly benefit from them. We are considering at the moment how to effectively deliver community benefits for those who live near new energy infrastructure, which includes new energy generation and transmission technology. We are developing guidance on community benefits for electricity transmission network infrastructure and onshore wind, which we will be publishing in due course. We are also reviewing our overall approach to community benefits, both to ensure consistency and quality and to ensure that communities are properly recognised and are able to come with us on our net zero and clean power journey. This includes looking to existing examples in Europe and further afield to see what has worked elsewhere. I look forward to updating the House on our approach to community benefits shortly.
The role of Great British Energy has been set out in its founding statement, and our commitment to putting local communities at the heart of the energy transition is a very strong component of what we are doing. The local power plan will support local communities to take a stake in the shift to net zero, as owners and partners in clean energy projects. They are important in themselves, as there is a huge appetite in many localities for community power, engagement and involvement. I agree that seeing a tangible benefit for local communities is important in itself, but it is also growing general support for the move to clean power and net zero, which is very important indeed.
We take the noble Lord’s point. It is clearly important, we are working on the details and will be publishing further information in due course. In my first week as a Minister in the department, I visited Biggleswade onshore windfarm, a small windfarm with 12 turbines. The company there is voluntary and there is a good practice trade guideline of paying £40,000 a year to the local community for such things as the local parish church, the community hall and other things. It was really good to see and is an example of what can happen.
Lord Offord of Garvel (Con)
I rise to close this group and indeed this sitting of the Committee today. It is worth saying that the chairman of Great British Energy, Jürgen Maier, has acknowledged the importance of communities. He used the words that GBE should be considered “a three-party partnership”, involving the private sector, the public sector and the community. If we also take account of the Labour assurances that have been given to communities along the way, I see no reason why we cannot consider these amendments further at the next stage, but for now, I beg leave to withdraw the amendment.
House of Lords
Political Parties: Funding
(3 days, 7 hours ago)
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Lord Blunkett
To ask His Majesty’s Government what steps they are taking to prevent political parties, and activities to promote political parties, from receiving funding from outside of the United Kingdom, and whether they plan to grant additional powers to the Electoral Commission in this regard.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, the Government committed in their manifesto to
“protect democracy by strengthening the rules around donations to political parties”.
Foreign money has no place in our elections and the rules already provide clear safeguards against foreign interference. We are considering changes which will help further protect our system from such risks and are engaging with the Electoral Commission as we do so. We welcome the views of and evidence from stakeholders. Details of our proposals will be brought forward in due course.
Lord Blunkett (Lab)
I very much welcome the Answer from my noble friend but does she agree that true patriots and those who believe in the sovereignty of our democratic system in the UK will want to see off those—whether they are malign state actors or multibillionaires—who seek to interfere in our democracy? Is it not now that we must act to safeguard our future?
Baroness Taylor of Stevenage (Lab)
I agree with my noble friend and assure him that the Government take the threat posed by disinformation and foreign actors interfering in our democratic processes very seriously. It is, and always will be, an absolute priority to protect the UK against foreign interference. While it is clear that foreign donations to political parties are not permitted, the Government recognise the risk posed by malign actors who seek to interfere with and undermine our democratic processes. That is why we will take all necessary steps to ensure that effective controls are in place to safeguard our democracy. I assure noble Lords that we share the sense of urgency, and as soon as we have developed our proposals we will inform Parliament.
Lord Leigh of Hurley (Con)
My Lords, the Labour Front Bench tabled amendments to the Elections Bill in 2022 that would have granted many foreign nationals the right to vote in both local and parliamentary elections; indeed, the IPPR is suggesting this again. How would Labour be able to restrict such donations? What assessment has been made of the potential influx of foreign donations from Russia, China and Iran as a consequence of the Labour Government in Wales and the Scottish Government allowing their foreign citizens to be on the electoral roll?
Baroness Taylor of Stevenage (Lab)
My Lords, the law is already clear that accepting or facilitating foreign campaign donations is illegal. Only those with a legitimate interest in UK electoral events can donate to candidates or political parties. Donations from individuals not on the electoral register are not permitted and strict rules are in place to make sure that foreign money is prohibited from entering through proxy donors, providing a safeguard against impermissible donations by the back door. We are looking at ways to make this even stronger. It is an offence to attempt to evade those rules on donations.
Lord Rennard (LD)
My Lords, does the Minister accept that there can be problems with very large donations to political parties, whether they may originate from abroad or be clearly from within the UK, and that the only way to prevent undue influence on political parties is to ban company donations and have a sensible cap on the size of all other donations? Does she then agree that political parties would still be able to campaign effectively if existing public funding was redistributed—for example, from the £100 million spent by the Government in the last two general elections on distributing candidates’ election addresses—and given to the parties to spend as they saw fit?
Baroness Taylor of Stevenage (Lab)
I take it that that was a question about a cap on donations. That is not a current priority for the Government, but strengthening the rules around donations really is. Political parties play a vital role in our democracy, and it is important that they are able to fundraise effectively and communicate with the electorate as a very important part of our process. By law, it is the responsibility of political parties to take all reasonable steps to verify their donors and whether they are permissible. We will take necessary steps to ensure that those requirements are tightened and stuck to.
Baroness Scott of Bybrook (Con)
My Lords, during the Lords stages of the National Security Bill, the last Conservative Government and Conservative Ministers pledged to enhance data-sharing powers to allow public bodies to share data with political parties. That is what we need; it is not about the honest ones who come through but knowing who is coming through a tenuous route, so that political parties are assisted in their due diligence. Can the Minister tell me the status of those plans to provide more information to political parties?
Baroness Taylor of Stevenage (Lab)
As I explained in my earlier Answer, we are reviewing all matters related to electoral donations. Those will be taken into account as we go through the process of developing any new legislation, including the issue raised by the noble Baroness.
Lord Dodds of Duncairn (DUP)
The Minister keeps referring to the fact that foreign donations are not allowed to parties in the United Kingdom but, of course, that is not correct because donations can come from the Irish Republic. In there lies a severe problem, in that funds from the United States, for instance, can be channelled via the Irish Republic into political parties in the United Kingdom with representation in these Houses, so will the Minister and the Government look at that issue?
Baroness Taylor of Stevenage (Lab)
The noble Lord raises an important point. Political parties registered in Northern Ireland can also accept donations from Irish sources, such as Irish companies that meet prescribed conditions. Allowing Irish donations to Northern Ireland parties recognises the special place of Ireland in the political life and culture of Northern Ireland. The rules are consistent with the principles set out in the Good Friday agreement. Irish donations are subject to the same scrutiny by the Electoral Commission as donations from any other permissible donor and if there are any complaints about that, they must be referred to the Electoral Commission.
Baroness Hayter of Kentish Town (Lab)
My Lords, the last Government extended voting to people who had been out of this country for more than 15 years. That in itself was not very problematic but it meant that they all became permitted donors. People who had not lived in this country for 40 or 50 years could become permitted donors and give money, with absolutely no ability to check on its source. Can my noble friend assure me that when this is looked at, that aspect introduced by the last Government will also be properly scrutinised?
Baroness Taylor of Stevenage (Lab)
My noble friend raises a very important issue. Political parties can accept donations only from registered electors but of course that now includes overseas electors. They are subject to the same counter-fraud measures as domestic electors, including having their identity confirmed as part of the registration process, but that very important issue will be looked at as we all look at all matters relating to elections.
Lord Hayward (Con)
My Lords, I welcome the response that the Minister gave to the noble Lord, Lord Blunkett, about a full consultation. However, she will be aware that the restrictions on election expenditure were set in the days when one could communicate with the electorate only through leaflets and the like. There are now many different ways of doing so, many of which are very cheap or low-cost. Will the Minister include in the review that she mentioned to the noble Lord, Lord Blunkett, some assessment of the restrictions on expenditure in general for elections at whatever level?
Baroness Taylor of Stevenage (Lab)
I am grateful for that question. There is no doubt that the system of campaigning has changed very dramatically, particularly in the last few years with the advent of social media. However, in my experience of campaigning—which spans a number of decades—political parties have adapted their campaigning but have not let go of their traditional methods. So although social media can be a very effective and efficient way of campaigning, we do still rely on some of the traditional methods. But, of course, that will be looked at as part of the review we are undertaking.
Baroness Winterton of Doncaster (Lab)
My Lords, voter registration is at shockingly low levels. Can my noble friend the Minister update the House on implementing automatic voter registration, as was also recommended by the Electoral Commission?
Baroness Taylor of Stevenage (Lab)
I agree with my noble friend that there are a large number of people still unregistered. When one goes out campaigning it is very clear that there are people who are not registered to vote who probably should be. We all need to address this and look at whatever way we can of making sure that everybody who is entitled to vote is not only registered to vote but takes part in our democracy. That is a very important part of our process, and we will do all we can to increase both voter registration and participation in elections.
Lord Wallace of Saltaire (LD)
My Lords, the Intelligence and Security Committee’s Russia report hinted at the very considerable extent of Russian money flowing into British politics, both to some political parties and, of course, during the Brexit campaign. Will the Government consider whether the redacted parts of that report should now be published to inform the public fully?
Baroness Taylor of Stevenage (Lab)
I am happy to look at that. We are very aware that this is a real issue, and we continue to be concerned about it. We will continue to take whatever steps we can to avoid foreign interference in our elections.
State Schools: Creative Education
(3 days, 7 hours ago)
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Baroness Keeley
To ask His Majesty’s Government what assessment they have made of the value to state school pupils of school visits to theatres, museums and galleries, and of the value of a creative education for all pupils.
The Minister of State, Department for Education (Baroness Smith of Malvern) (Lab)
My Lords, a creative education and enriching experience must be for all, not just the preserve of the privileged few. Drama and theatre studies students at GCSE and A-level are entitled to experience live theatre, and schools can and do decide which other visits to offer to other students. But it is also important that students can benefit during curriculum and lesson time. That is why the independent curriculum and assessment review will seek to deliver a broader curriculum and consider how best to support a young person to develop the knowledge and skills needed to thrive.
Baroness Keeley (Lab)
My Lords, there is evidence that the experience of attending live theatre helps children to learn, while structured arts activities at school increase cognitive skills across all subject areas. Companies like the Royal Ballet and Opera and the RSC are doing amazing work in opening their doors to schools, but the Sutton Trust still reports that state school trips were cut by 68% in the most disadvantaged schools in 2023. Further, since the introduction of EBacc and Progress 8 there has been a systematic downgrading of arts subjects and experiences in state schools. Can my noble friend the Minister tell me if it is a priority for the Government to start to reverse these trends and to ensure access to a creative education and arts experiences for all state school pupils in order to help build their confidence and skills?
Baroness Smith of Malvern (Lab)
My noble friend rightly identifies that there has been a decline in student entries into, for example, the arts and creative GCSEs, a reduction in the number of staff available to teach them, and a fall-off in the ability of schools to support students with visits and the type of experiences that she rightly outlines. That is why it is so important for this Government that we ensure that creative subjects such as art, music and drama are important elements of the education that every child deserves, and that we do better in ensuring that culture is an essential part of supporting children and young people.
Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)
We will hear from the Conservative Benches.
Lord Vaizey of Didcot (Con)
My Lords, I declare my interest as a trustee of Tate. May I say to the Minister how reassuring it is to see an Education Minister addressing this Question? To make arts education as effective as possible, close working between the Department for Education and DCMS is essential. I am afraid that money involved. For example, visiting a theatre or museum costs schools money and many of these museums have to find money from their own budgets as well. Will the Minister meet with her counterpart in DCMS and look at a strategy in the round to engage our schoolchildren in meaningful visits to theatres and museums, with some financial support to help that?
Baroness Smith of Malvern (Lab)
The noble Lord is absolutely right. It is important for those of us in the Department for Education to work across government with DCMS colleagues in this area, and I assure him that that is already happening. We are making sure that, as he will know, the £444 million being invested in arts by this Government and the Arts Council is used to the best potential. He will also know that 79% of the national portfolio supported by that money is already delivering activities specifically for children and young people. We need to ensure that schools and children are able to benefit from that.
Lord Kennedy of Southwark (Lab Co-op)
We will hear from the Liberal Democrat Benches next.
Lord Addington (LD)
I thank you for being allowed to speak. Will the Minister take on board that museums often tell you certain things about development, for example, and the importance of design and technology? Unless you can develop the mouse to work with the computer—something we can all use easily—it does not happen and does not become a mass tool. That information is best conveyed by showing it. Can the Minister make sure that this is an important part of the curriculum for those subjects?
Baroness Smith of Malvern (Lab)
The noble Lord makes an important point about the benefits to children’s learning of being able to see the development and design of ideas; I wholeheartedly agree with him. That will be an important part of our thinking on how we support existing initiatives, so that children can benefit, and so that, through the curriculum, those opportunities are not only available but supported, particularly for disadvantaged children, who have too often missed out.
Lord Bird (CB)
Can we also include, while we are at it, young people in the custodial system? I am here only because I did art and creative things when I was in a juvenile detention centre. Unfortunately, a lot of those opportunities have disappeared in our custodial system for young people.
Baroness Smith of Malvern (Lab)
I have no doubt that a broad education, which also enables children and young people to engage in creative activities, is one of the things that protects against some of the circumstances the noble Lord identifies. As I have my noble friend Lord Timpson sitting alongside me on the Front Bench—
Baroness Smith of Malvern (Lab)
He flits. I have no doubt that my noble friend has also heard what the noble Lord has to say. He is a strong advocate to me and other Ministers of the need to ensure that, in everything we provide, those in custody can also benefit, because of what it means for them as individuals and for their future ability not to reoffend.
Baroness Barran (Con)
I know that His Majesty’s Government are particularly concerned about opportunities for children with special educational needs and disabilities. Can the Minister update the House on how those children are able to access these trips, particularly bearing in mind the correspondence that I am sure she will have seen from the special educational needs and disabilities transport operators? They have concerns about the impact of the increase in national insurance contributions on their ability to take 200,000 children to school every day.
Baroness Smith of Malvern (Lab)
The noble Baroness is absolutely right to identify that, if we believe that these opportunities are important for children, they must be perhaps even doubly important for children with special educational needs and disabilities. That is why, in trying to mend the special educational needs system we have inherited, we will focus on ensuring that it is inclusive and enables all children—whether in mainstream schools or special schools—to benefit from the things that will support them. We will also find ways—for example, through the music opportunities pilot, launched last autumn—to offer disadvantaged and special educational needs pupils across primary and secondary schools the opportunity to learn to play an instrument of their choice or to learn to sing, with free lessons. We are committed to this, and we will continue to develop it.
The Lord Bishop of Leeds
My Lords, schools feed in to universities, and the number of arts and humanities departments in universities has been in decline. I learned recently—and I speak as a linguist—that if all the students currently training in modern languages at university were to go into teaching, we would still only fund 70% of the language-teaching posts. This is a systemic problem in the arts and humanities. Trying to get PhD funding for arts and humanities is increasingly difficult. Will the Government commit to looking at the whole stream of the educational system in this respect, and not just schools?
Baroness Smith of Malvern (Lab)
The right reverend Prelate is absolutely right that, in order to offer opportunities to children, we need to have the qualified teachers in place to deliver them. That is why this Government are committed to recruiting 6,500 more teachers and, of course, have in place the £10,000 tax-free bursary for teachers of art and design and music. It also means that we have to ensure that our higher education institutions receive the support necessary to develop these subjects. That means overall support for the financial sustainability of higher education, alongside the specific funding we make available to support high-cost subjects such as performing and creative arts subjects and media studies. There is also the government grant that we provide for small and specialist providers that are recognised as world-leading, of which, out of the 20 we support, 12 are creative and performing arts providers.
Courts: Backlogs
(3 days, 7 hours ago)
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Baroness Hazarika
To ask His Majesty’s Government what plans they have to tackle court backlogs, and whether they have considered reducing trial by jury.
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Ponsonby of Shulbrede) (Lab)
My Lords, the Government remain committed to bearing down on the Crown Court backlog, but the challenge in doing so is significant. The Lord Chancellor has commissioned an independent review of the criminal courts, led by Sir Brian Leveson, to recommend long-term reform. Sir Brian has been asked to specifically consider the merits of hearing more trials outside the Crown Court. Jury trials will always remain a cornerstone of our justice system for the most serious cases, but we must consider bold action to tackle the backlog in our courts.
Baroness Hazarika (Lab)
I thank the Minister for that Answer. He is right that, because of the terrible inheritance of these court backlogs, we have to think radically and challengingly. We have to think about the victims. Some victims now are having cases listed as far away as early 2028. Is it right that a class C drugs offence sits in the Crown Court queue, while a vulnerable rape victim has to wait five-plus years from report to court? That often risks them walking away and allowing a potential rapist to escape. Does he agree that justice delayed is justice denied?
Lord Ponsonby of Shulbrede (Lab)
Yes, I agree with my noble friend that justice delayed is justice denied, and I agree with the sentiments she expressed in her question. But that is the argument for bold and ambitious reform—and we very much hope and expect that that is what Sir Brian will deliver. The review will consider the merits of longer-term reform, as well as court efficiency. Sir Brian will consider court reform options that would reduce demand on the Crown Court, including reclassification of offences, consideration of magistrates’ sentencing powers and the introduction of an intermediate court. The review will provide findings on court reform by spring this year, and its findings on efficiency will come forward by autumn this year.
Lord Marks of Henley-on-Thames (LD)
My Lords, will this Government distance themselves from the Conservatives, who blamed the backlogs on Covid and on criminal barristers, who had no option but to strike to secure proper remuneration? Will the Minister tell the House what immediate steps they propose to address the real causes of these record backlogs, which delay trials and frustrate justice—in particular, too few judges, lawyers and court staff; a wrong-headed cap on court sitting days, severely criticised by the Lady Chief Justice, which has led to unplanned courtroom closures; and trials adjourned through listing and prisoner transport mistakes?
Lord Ponsonby of Shulbrede (Lab)
My Lords, the two factors to which the noble Lord referred are real factors—Covid and the action by barristers. However, there is an underlying problem of increasing cases coming to Crown Court, which overlays the other problems to which the noble Lord referred. The Government have increased the number of allocated sitting days to 108,500, the highest level in almost a decade, and increased the sentencing powers of magistrates’ courts from six months to 12 months. Nevertheless, with those two increases, there needs to be further radical reform to address the problem to which the noble Lord referred.
Lord Keen of Elie (Con)
My Lords, as the Minister noted, much of the Crown Court backlog can be traced back to the effects of the Covid epidemic. Indeed, I acknowledge that there has been an increase in the number of sitting days for the Crown Court. However, the Lady Chief Justice has indicated that there are a further 4,500 sitting days available. We are in a situation in which many major Crown Court centres are sitting at only half capacity, with many of the courts simply empty. There are courts and judges available, but I am repeatedly advised that there are not suitable defence counsel available, many having been driven out of criminal practice due to the absence of a sustainable fee income. A recent increase in legal aid fees has been granted to solicitors in criminal practice. Is it not time for this Government to address a similar increase for barristers in criminal practice?
Lord Ponsonby of Shulbrede (Lab)
My Lords, the noble and learned Lord is right to draw attention to the 12% increase in fees for criminal aid solicitors. That is a substantial amount of money. The Government are exploring options to incentivise the early resolution of cases, which includes the remuneration of everyone in the criminal justice sector. The Government are informed by the 2021 report of the noble and learned Lord, Lord Bellamy, and considerations are ongoing on this matter.
Lord Sentamu (CB)
My Lords, sitting with two assessors, I tried a brutal rape and GBH case. The perpetrator was found guilty. Had we had trial by jury, it would have added weight to the conviction and sentencing. Is not the best way to deal with the court backlog that we request the Lord Chancellor and the Judicial Appointments Commission to appoint more judges and persuade retired judges, including the noble and learned Lords, to put all hands to the pump? They are sprightly.
Lord Ponsonby of Shulbrede (Lab)
I thank the noble and right reverend Lord for his observations. We are taking a different approach, which is to look at the overall working efficiency of the court system. I acknowledge that there are substantial backlogs, particularly in rape cases, because they are often very complex cases. There is also the added distressing fact that many rape victims drop out of the process because of the lengthy delays. I acknowledge that that is a problem, but we believe that the best way to address this is to look at how the system operates as a whole. We are looking forward to receiving Sir Brian’s recommendations in due course.
Baroness Chakrabarti (Lab)
My Lords, I hope my noble friend the Minister knows that I have a lifetime of respect for professional tribunals, lawyers and judges, including Sir Brian, and their fair remuneration. Notwithstanding concerns about the backlog, which are considerable, I hope he agrees with me that there will always be benefit in jury trial for the most serious cases. That benefit is about public confidence, legitimacy and participation in the legal system on which the rule of law depends.
Lord Ponsonby of Shulbrede (Lab)
I completely agree with my noble friend: public confidence is absolutely paramount. That is one reason why jury trials were persisted with—quite rightly—during the Covid period. Having said that, there are certain types of cases where it is maybe not appropriate that a jury trial should be available. I anticipate that Sir Brian is looking at those sorts of cases.
Lord Burnett of Maldon (CB)
My Lords, the current outstanding backlog in the Crown Court is a little over 73,000; it was only 40,000 when Covid struck. The Minister has already indicated that the volume of cases coming into the Crown Court continues to increase. Has any solution occurred to him or his colleagues other than to restrict the right to jury trial for the relatively low-grade cases of the sort that the noble Baroness, Lady Hazarika, spoke of, which clutter up the Crown Court?
Lord Ponsonby of Shulbrede (Lab)
The noble and learned Lord makes a very fair point. It is regrettable that the numbers are so high and are increasing—that is the underlying problem with which we are grappling within the Ministry of Justice. It is interesting that in the family court system we are back down to the pre-Covid numbers; that is good, and we are trying to bear down on that further. Nevertheless, the noble and learned Lord makes a very good point and I am sure that Sir Brian Leveson will address these points.
Lord Jackson of Peterborough (Con)
My Lords, the Minister will be aware of considerable concerns articulated by the Magistrates’ Association, among others, on the single justice procedure and the impact on vulnerable people, such as those with dementia or cancer, who have been brought to court. As he knows, that system is a magistrate with a lay expert supporting him. Will those issues, which are long standing since the establishment of the single justice procedure in 2015, be part of the ongoing review, as articulated by his right honourable friend Heidi Alexander two months ago?
Lord Ponsonby of Shulbrede (Lab)
I have sat as a single justice on certain types of cases. I understand that there are concerns about the single justice procedure, but I am not sure of the answer to the noble Lord’s question about whether it is part of Sir Brian’s review. I will write to him on that question.
Gaza: Peace Talks
(3 days, 7 hours ago)
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Lord Hain
To ask His Majesty’s Government what assessment they have made of the prospects for the current peace talks involving Israeli and Palestinian leaders.
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, resolving the conflict has been a priority since day 1 of this Government. The fighting must stop and all sides must seize the opportunity to open a pathway to lasting peace and stability. We are encouraged by the progress being made on ceasefire negotiations and urge all parties to show the flexibility needed to reach an agreement. We continue to use every diplomatic lever to bring about a ceasefire and secure the safe release of hostages in co-ordination with international partners.
Lord Hain (Lab)
My Lords, does my noble friend not agree that Palestinians, Israelis and indeed the whole world need a permanent ceasefire—not a quick fix, but a real end to hostilities? All the hostages should be out and Palestinian civilians should be returned to what little remains of their Gaza homes north and south. There should be no more starvation—which means preserving UNRWA—no reduction in the size of this integral part of the state of Palestine and no Israeli settlements. A Marshall-type plan is needed for the recovery of Gaza, with everyone held to respecting international law. Surely, this is the only path to real and stable peace for both Israelis and Palestinians. How will the Government help achieve that?
Baroness Chapman of Darlington (Lab)
I thank my noble friend and acknowledge the work that he did as Minister for the Middle East and North Africa. He is absolutely right that a permanent peace is what we need to seek. A ceasefire would only ever be the first step. The hostages must be released and be home with their families. We also agree on the importance of UNRWA being able to continue its work. My noble friend asked about reconstruction. We are thinking very much about the next phase of planning in Gaza and building up its governance and security institutions. This must be predicated on tangible progress towards a Palestinian state.
Lord Callanan (Con)
My Lords, I am sure that the whole House is united in wishing to see peace in this terrible conflict. The key to a sustainable end to the fighting in Gaza remains, first, the elimination of Hamas and, secondly, the release of the hostages, whose suffering is truly intolerable. It should be intolerable for anyone who cares about human dignity and human rights. Does the Minister have any information on the well-being of the British national hostage, Emily Damari?
Baroness Chapman of Darlington (Lab)
The noble Lord is completely right in everything he said about the hostages. My honourable friend Hamish Falconer the Minister for the Middle East, the Foreign Secretary and the Prime Minister have met on several occasions Emily’s family and others with British links who are wrongly held in Gaza. We are doing everything we can, using all levers to secure their immediate release.
Lord Purvis of Tweed (LD)
My Lords, any agreement that will allow the hostages to come home and the violence against the Palestinian civilians to end cannot come too soon. Does the Minister agree that the most represented group among Palestinian deaths and verified casualties are children between the ages of five and nine? The suffering will continue even if there is a ceasefire, because there are no educational facilities separate to those provided by UNRWA and no health facilities, especially for girls. Will the UK play a crucial role, as it did after the liberation of Mosul, to support pop-up education and psychosocial support for young children in particular? If there is to be long-term sustainable peace, we cannot allow a traumatised generation of children to continue to suffer.
Baroness Chapman of Darlington (Lab)
I agree with the noble Lord. The ceasefire would be only the beginning. He is also right to remind us that around 50% of the bodies identified in Gaza so far have been of children and women. We are providing substantial aid to UNRWA and other agencies that are providing the support that he wishes to see in Gaza and in neighbouring places as well. That includes education, food, medicine and the psychosocial support that they are going to need for some years to come.
Lord Grocott (Lab)
My Lords, I strongly welcome the possibility of an end to the killing, but is not the sad lesson of the history of this region that the world’s attention is strongly on it and the need for solutions as long as violence is threatened or immediate? As soon as the violence goes away, the world’s attention moves elsewhere. After the slaughter that has taken place, is it not vital that we try to build something constructive out of it? That can occur in the long term only if the Palestinians have a state of their own.
Baroness Chapman of Darlington (Lab)
That is right. The United Kingdom Government stand ready to play a leading role in reconstruction and securing a stable Palestinian state alongside a secure Israel. Gaza’s recovery and reconstruction must be Palestinian led, though, and support for future governance of the Palestinian Authority in Gaza and maintaining the viability of a future Palestinian state are an important part of the UK’s approach.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, to follow on from the last question, it is vital that a sustainable reconciliation process happens, hopefully after any peace deal. Bearing in mind what happened with us in Northern Ireland dealing with domestic terrorism, is it not important to set rules in relation to any elections that take place to any Palestinian Authority? Would not those rules have to include a commitment to non-violence and recognition of the State of Israel?
Baroness Chapman of Darlington (Lab)
These issues of reconciliation and truth and the process that needs to be undergone are fiendishly difficult, as the noble Baroness has experienced and which we can see when we look at any of these processes anywhere in the world, from Chile to South Africa to Northern Ireland—and I hope in the future in Israel-Gaza. She made her point very well.
Lord Ahmad of Wimbledon (Con)
My Lords, I am sure I speak for all in your Lordships’ House in recognising the importance of a peace agreement; we are on the brink. We hope, and those of faith pray, that this agreement is reached. Will the Minister acknowledge, as I do, the important role that the United States—and indeed the incoming Administration—Egypt and in particular Qatar have played in their persistence in ensuring that this deal is reached? We all want to see the hostages released; we want to see aid into Gaza, and we want to see peace and security across the Holy Land. Will the Minister ensure that, as others have said, the momentum is sustained? You must be in the game, you must persist, and you must keep the momentum going to see the peace and security that we all so desire and that, most importantly, Israelis and Palestinians need now.
Baroness Chapman of Darlington (Lab)
The noble Lord is right. It is important that we acknowledge the role of all players who have been instrumental in facilitating negotiations and smoothing this along, including, as he says, the United States, Egypt and Qatar. Of course, we have hope, given recent announcements, but I would draw a strong distinction between hope and optimism. We need to be realistic and patient, but our hope remains, and I have more hope today than we perhaps did a week ago.
Lord Dubs (Lab)
Does my noble friend agree that there has also been an increase in violence in the West Bank? Will the Government confirm that they are totally opposed to any expansion of settlements in the West Bank no matter what the American Government decide?
Baroness Chapman of Darlington (Lab)
As we have discussed previously, the problem with settlements and some of the activity we have seen around them is that it makes the two-state solution more difficult to deliver in practical terms—so we do have concerns, as the noble Lord says.
Lord Soames of Fletching (Con)
My Lords, can the Minister confirm that in respect of these particular talks, quite apart from the vital necessity of the release of the hostages, it is very much the imperative that the Israelis are made to open more spaces for relief to starving Palestinians in Gaza and elsewhere?
Baroness Chapman of Darlington (Lab)
The Israeli Government have a responsibility to allow aid to those who need it. The situation is urgent: the hunger and the deaths from the cold that we have seen among young children because of the change in the weather are appalling. We appeal to the Israeli Government to allow the necessary aid to reach those who need it.
Baroness Hayman (CB)
My Lords, will the Minister take this opportunity to recognise the courage and commitment of those groups of Israelis and Palestinians working for peace who have continued to do so throughout this conflict? Will she also ensure that they are involved in the desperately difficult process that will follow any ceasefire of building a sustainable peace?
Baroness Chapman of Darlington (Lab)
As in many conflicts, there are some incredibly courageous individuals who risk their own lives to bring forward the cause of peace. It is only right that we are reminded of those people today. We should also remember the more than 300 aid workers who have been killed throughout this conflict. I thank the noble Baroness for her comments.
Data (Use and Access) Bill [HL]
(3 days, 7 hours ago)
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Lord Vallance of Balham
That the Bill be considered on Report in the following order:
Clauses 1 to 56, Schedule 1, Clauses 57 and 58, Schedule 2, Clauses 59 to 65, Schedule 3, Clauses 66 to 70, Schedule 4, Clause 71, Schedule 5, Clauses 72 to 80, Schedule 6, Clauses 81 to 84, Schedules 7 to 9, Clauses 85 to 102, Schedule 10, Clauses 103 to 107, Schedule 11, Clauses 108 to 111, Schedule 12, Clauses 112 and 113, Schedule 13, Clauses 114 and 115, Schedule 14, Clauses 116 to 119, Schedule 15, Clause 120, Schedule 16, Clauses 121 to 138, Title.
Registrar (Identity Verification and Authorised Corporate Service Providers) Regulations 2024
Lord Leong
That the draft Regulations laid before the House on 22 May and 31 October 2024 be approved. Considered in Grand Committee on 13 January.
Free-Range Egg Marketing Standards (Amendment) (England) Regulations 2024
(3 days, 7 hours ago)
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Baroness Hayman of Ullock
That the draft Regulations laid before the House on 21 November 2024 be approved. Considered in Grand Committee on 13 January.
Combined Authorities (Borrowing) and East Midlands Combined County Authority (Borrowing and Functions) (Amendment) Regulations 2025
(3 days, 7 hours ago)
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Baroness Taylor of Stevenage
That the draft Regulations laid before the House on 19 November 2024 be approved. Considered in Grand Committee on 13 January.
Drones: High-security Prisons
(3 days, 7 hours ago)
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Lord Keen of Elie (Con)
My Lords, the Chief Inspector of Prisons has just delivered a devastating report on conditions at His Majesty’s Prison Long Lartin and His Majesty’s Prison Manchester. At HMP Manchester, almost 40% of prisoners have failed standard drug tests. The Chief Inspector of Prisons has reported that criminal gangs now, in effect, control the airspace above this high-security prison using drones. A number of years ago, the use of drones was emerging, and they could be controlled by physical defences such as nets and blocked windows. Unfortunately, even these basic defences were neglected at HMP Manchester. However, there have been recent and rapid developments in drone technology. First-person viewing drones, GPS-controlled drones and others are all capable of delivering not only drugs but weapons and even explosives. Will the Minister address not only the existing security failures at HMP Manchester but the possible introduction of electronic countermeasures at high-security prisons such as HMP Manchester?
The Minister of State, Ministry of Justice (Lord Timpson) (Lab)
The noble and learned Lord is completely right that drones pose a major and serious threat to all our prisons. I have been visiting Manchester prison for over 20 years, and I went there just before Christmas, in the light of the problems that it has. I saw for myself the issues that staff are dealing with, with 49% of the prisoners arriving in the prison being addicted to drugs. I cannot share the counter-drone tactics as that would play into the hands of sophisticated and serious organised criminals. I can assure the noble and learned Lord that we are currently getting on with a number of fixes, but the biggest fix is ensuring there is no market for drugs and weapons in the first place, and that people in prison are there to get on with their sentence, get educated and do purposeful activity, so that when they are out, they stay out.
Lord Reid of Cardowan (Lab)
Will the Minister confirm the magnitude of the challenge that he has inherited? Is it not the case that, during the period of the previous Government, there was an increase in drug finds of 44%? In the year until March last year, there was an increase in weapon finds of 24%. The Minister now faces a challenge because of the fact that, over the past 14 years, very little has been done to confront the challenge.
Lord Timpson (Lab)
The noble Lord is completely right that the prisons I am visiting now are very different from the prisons I visited 15 or 20 years ago. The buildings are often in decrepit states of repair. We have a lot of new staff who are still learning the skills of being a prison officer and we have an awful lot more to do to ensure that people, when they are in prison, spend their days purposefully, not just sitting in their cells.
Lord Rooker (Lab)
Can I ask my noble friend about Long Lartin? I am going beyond the Question, but is the safety of the inmates as such today that they are able to exercise in every exercise yard? Long Lartin’s proximity to the countryside and the geography around it allow potential problems from the outside against the inmates. I should like an assurance that that matter has been dealt with since I visited some years ago.
Lord Timpson (Lab)
Like the noble Lord, I visited some years ago, so I do not have an exact picture in my mind of the layout of the exercise yards. I can assure him that every male closed prison now has X-ray scanners. In 2003, there were over 1,000 drone sightings. They were up 770% between 2019 and 2023. We have a serious problem but if I know any more details, I will let him know.
Lord Carlile of Berriew (CB)
My Lords, does the noble Lord agree that the focus for prisoners should be on not taking drugs when they come out of prison? Does he agree that there is still a gap in making sure that prisoners know what will be done to help them to stop taking drugs on their release and that, if there was greater co-operation in that regard, we might not have quite as big a problem with drones as we have today?
Lord Timpson (Lab)
The noble Lord is completely right. There are far too many people in prison who arrive addicted and stay addicted. They need an incentive and support not to take drugs. That is why I am a big fan of substance-free living wings and engaging with probation early so that, when people are released, we have a seamless link whereby probation picks up with all the drug workers on release.
Baroness Hamwee (LD)
My Lords, a major component of security regarding prisons must be stable, expert and sufficient staffing. The Minister referred to staff. When it give evidence to our Justice and Home Affairs Committee, the Prison Officers’ Association referred to the recruitment process as being simply not fit for purpose and said that it was not surprising that corrupt and underqualified officers were being recruited—referring in particular to online interviews. Can the Minister give the House any news about improving the recruitment process and the number of staff?
Lord Timpson (Lab)
I thank the noble Baroness for the question. Having run a business for many years and tried to find fantastic superstars to work with, I am well aware that we always want to find the best colleagues to work in our prisons. I am very engaged with the POA team as well. Noble Lords may be interested to know that we are currently at 99.5% staffing levels. That does not mean that everybody is trained and in the right place, but MoJ colleagues have made good progress on that. As regards the way recruitment works in our prisons, professionally trained assessors always take part in the interviews.
Lord Hogan-Howe (CB)
My Lords, our prisons are very good at keeping people in; I am afraid they are not as good at keeping things out. There are two symptoms of that: the large number of mobile phones and, as has been said already, the amount of drugs in prisons. Some 40% of the people who enter have a drug problem, but 60% of those who leave have one; they get their problem in prison. Drones are clearly an issue, but I am afraid that corruption is a bigger one. One of the biggest challenges is, I am afraid, that nobody is really concentrating on this issue in terms of investigation: the NCA is too diffuse, local forces are too busy, and the Prison Service has no investigative capacity. Would the Minister be interested in attending a short meeting on two distinct proposals to see how they might be able to do something about this? There would be some cost, but I promise him not too much.
Lord Timpson (Lab)
I thank the noble Lord for the question; I would be delighted to meet up and to learn more. The problem we have with serious organised crime in our prisons is that these people are in there to make money. They do that by selling phones and drugs, which creates debt and violence, so it is essential that we tackle this. We are giving more focus to our dedicated serious and organised crime unit and we are working across government, but the noble Lord is right that this is vital.
Lord Woodley (Lab)
My Lords, yesterday the Justice and Home Affairs Committee heard from the chair of the Prison Officers’ Association that it was only a matter of time before arms were sent into prison via drones. There were even concerns that, with drones now being able to carry 75 kilograms, they could be used to facilitate some form of escape. Can the Minister please explain what anti-drone technologies we have in place, and will they be whizzed out across the rest of the empire?
Lord Timpson (Lab)
I thank my noble friend for the question. I am afraid that, due to security reasons, I cannot go into any details on the measures that we have and that we will have. However, I can assure him that we will spend £520 million on maintenance over the next two years, because we have inherited prisons in such a bad state. A lot of that money will be spent on repairing nets, grilles and windows.
Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)
Let us have the Conservative Benches and then the Cross Benches. If noble Lords are very quick, we will get both in.
Baroness Sugg (Con)
My Lords, can the Minister update the House on any improvements since the introduction in January 2024 of the no-fly zones around certain prisons? Have they been a success, and how can we boost their effectiveness?
Lord Timpson (Lab)
The no-fly zones have been a great success and have been an important part of the work we are doing, but there is still further work we need to do. I reiterate that the demand is just as big a problem as the supply.
Lord Carter of Haslemere (CB)
My Lords, drugs getting into prisons, whether by drones or otherwise, give rise to self-inflicted deaths. Coroners issued 12 prevention of future deaths reports to the Ministry of Justice in 2024, relating precisely to this issue of the link between drugs and self-inflicted deaths. Of course, the Government have a legal duty of care towards prisoners and a legal duty to respond to these prevention of future deaths reports, which I do not think has happened. Can the Minister assure us that this will be looked at and that the reports’ recommendations will be implemented?
Lord Timpson (Lab)
The noble Lord is right that any death in custody is a death too many. One of the most difficult jobs I have, when I read my emails every morning, is when I get notified that we have had a death in custody. That is someone who was in our care, and I take that very seriously.
Financial Assistance to Ukraine Bill
Wednesday 15th January 2025
(3 days, 7 hours ago)
Lords ChamberRead Full debate Financial Assistance to Ukraine Act 2025 View all Financial Assistance to Ukraine Act 2025 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 18 December 2024 - (18 Dec 2024)
The Financial Secretary to the Treasury (Lord Livermore) (Lab)
My Lords, it is a privilege to open this debate and to speak alongside so many expert noble Lords. I take this opportunity to welcome the noble Baroness, Lady Batters, to your Lordships’ House and very much look forward to her maiden speech.
More than 1,000 days since Russia launched its illegal invasion of Ukraine, the Ukrainian people face a third winter of struggle for survival. They have paid a heavy price—thousands of lives lost, families torn apart, and whole communities destroyed beyond all recognition. Russian artillery continues to target civilian infrastructure and degrade Ukrainian energy networks, leaving ordinary people to freeze in icy cold conditions. Every day on the battlefield, Ukrainian soldiers give their lives in defence of their homeland and the common values that we share. Despite all this, the spirit of the Ukrainian people remains unbroken and Ukrainian forces continue to take the fight to their Russian aggressors with courage and conviction.
We should be under no illusion about the stakes. As the Foreign Secretary has said, Putin’s invasion of Ukraine is being driven by an “imperialist” desire to expand his
“mafia state into a mafia empire”.
It has involved forcibly seizing territory to which Russia has no legal right and for which the Russian people are paying an enormous price. It is a strategy built on corruption and the crushing of dissent—including courageous opponents such as Alexei Navalny—and is backed by the spread of disinformation at home and abroad.
Noble Lords will note that this is a fight not only for Ukraine’s territorial integrity and the safety of its people but for the future of Europe’s collective security and prosperity. The Government have consistently been clear that Putin must fail, but our words of condemnation are not in themselves enough. Action is required. That is why the UK’s support for Ukraine has never wavered, regardless, I am pleased and proud to say, of which party has been in government. I pay tribute to noble Lords opposite who stood side by side with President Zelensky and the Ukrainian people in their hour of need. We are united in saying that we will continue to stand with Ukraine for however long it takes.
Last year, the Prime Minister announced the Government’s commitment to provide £3 billion of military support to Ukraine each year for as long as is needed. Overall, the UK’s combined military, humanitarian and economic support for Ukraine now stands at £12.8 billion. That includes state-of-the-art Challenger 2 battle tanks and Storm Shadow missiles, as well as NLAW anti-tank missiles produced in Belfast that helped Ukrainian soldiers bravely repel the initial attack on Kyiv. Through the hugely successful Operation Interflex, UK Armed Forces have helped train more than 50,000 Ukrainian military personnel.
In total, the UK has now delivered around 400 different military capabilities to Ukraine, with a new £225 million package of drones, boats and munitions announced in December. This builds on the introduction of the most wide-ranging sanctions regime ever imposed on a major economy. As a result of this, we have successfully restricted Russia’s access to global financial markets, reduced its energy revenues and weakened its ability to finance this illegal war. This includes sanctions on more than 2,100 individuals and entities, amounting to over £20 billion. More than 100 ships used for transporting Russian energy have been targeted, including 93 oil tankers that form part of Russia’s shadow fleet, used to illicitly transport billions of pounds’ worth of oil across the globe. The oil price cap has reduced Putin’s tax revenues from oil by 30%.
We are continuing to keep up this pressure. Just last week, the Foreign Secretary announced the designation of two Russian oil giants that together produce more than 1 million barrels of oil per day. The UK has also taken steps to bolster the Ukrainian economy, including by signing the UK-Ukraine digital trade deal to ensure that Ukraine benefits from cheaper and quicker trade. UK Export Finance has provided over £500 million in loan guarantees, including for Ukraine’s own defence industry. We have committed £4.1 billion in fiscal support through loan guarantees on World Bank lending.
However, we cannot stop there. We must continue to back Ukraine, to help its people deter Russian aggression so that they can secure a just and lasting peace on their terms. That is why the Chancellor has committed £2.26 billion to the G7’s extraordinary revenue acceleration loans to Ukraine scheme. This scheme will provide a combined upfront loan of £50 billion from G7 lenders—including the US, Canada, Japan, the UK and the EU. This loan will be repaid from the extraordinary profits generated on holdings of immobilised Russian sovereign assets held in the Euroclear bank in the EU. Euroclear is an international central securities depository with a unique business model, allowing for these profits to be generated.
The EU has already enacted the necessary regulation to operationalise the Ukraine loan co-operation mechanism, which will distribute the profits from the immobilised sovereign assets. The UK’s contribution to the scheme will be provided to Ukraine as budgetary support earmarked for military procurement such as air defence and artillery. It will be delivered in three tranches over three financial years, with the first tranche intended to be delivered early this year. The funding will be issued from the Treasury estimate and was scored in the Budget in October. This new funding is additional to the £3 billion of bilateral military support, which, as I have said, the Government are committed to providing for as long as it takes.
I am aware that the noble Lord, Lord Blencathra, has tabled an amendment to the Motion, calling for immobilised Russian state assets to be used to fund financial assistance to Ukraine. I commend the noble Lord for his work on this issue and the support he has shown for Ukraine. The Bill does not allow for the seizure of assets themselves, in the EU or elsewhere. The Government continue to actively consider all lawful options for ensuring that Russia pays for the damage it has caused in Ukraine. Any action must be taken in tandem with the G7—this is vital to maintain the strength and unity the G7 has already shown in the face of Putin’s aggression. The Bill before your Lordships’ House is designed to deliver new funding to Ukraine as quickly as possible.
Importantly, the Government have agreed with our G7 allies to ensure that Russian sovereign assets remain immobilised across our jurisdictions until Russia ceases its war of aggression and pays for the damage it has caused to Ukraine. G7 lenders have worked closely together to design the scheme in a way that allows repayment in a scenario where profits cease and Russia pays reparations to Ukraine. The sole purpose of the Bill is therefore to provide the Government with a spending authority to deliver this contribution to the G7 scheme. It enables the Government to sign the loan agreement with Ukraine and begin dispersing funds.
By unlocking new funding backed by profits generated from immobilised Russian sovereign assets, we will enhance Ukraine’s ability to defend itself and step up international pressure on Putin’s war machine. We know that this war is already costing Putin dearly. It is a fight for land to which Russia has no right and for which the Russian people are paying an enormous price. To restore peace we must ensure that Putin has no path to military victory. That means deepening our resolve by working in partnership with G7 allies to provide the support Ukraine needs for as long as it takes, not only in defence of Ukrainian sovereignty and the safety of its people but for the liberal democratic values we cherish and the security we depend on. I beg to move.
Baroness Neville-Rolfe (Con)
My Lords, I thank the Minister for his helpful and descriptive introduction. I will not repeat all the detail he kindly gave us. Like him, I much look forward to the maiden speech of the noble Baroness, Lady Batters. She is a near neighbour of mine in Wiltshire and a trailblazing first female president of the National Farmers’ Union. We worked together professionally, and I know the House will benefit hugely from her talents and energy.
It is clear from discussions in the other place that there is practically universal support for helping Ukraine in its struggles. The United Kingdom was a first mover in supporting Ukraine in 2022. Prime Minister Boris Johnson led the charge and there has been an encouraging consistency in support through the premierships of Liz Truss, Rishi Sunak and, of course, our Prime Minister Sir Keir Starmer. We have pledged over £12 billion since 2022 and sanctioned more than 2,000 entities. Moreover, many people in Britain have generously welcomed displaced Ukrainian families into their homes.
The proposed arrangement is an unusual one, of which the UK was a vociferous advocate. From these Benches we support the UK loan to Ukraine of £2.26 billion, which will be repaid from revenue earned on frozen Russian assets. We also support the decision to earmark the UK contribution towards military expenditure, including on air defence, artillery and other equipment so desperately needed by our Ukrainian allies. This is particularly important as the £20 billion coming from the United States is being handled by the World Bank, which I believe means that it cannot be used for military purposes.
We therefore support the Bill. We would, however, need convincing if the Government were minded to contemplate seizing Russian assets themselves. That would be a large step with wider ramifications and would need detailed scrutiny.
I should add that I have some professional experience of dealing with Ukraine and, to speak frankly, there were issues with the siphoning off of expenditure in the health area, which the not-for-profit development body I chaired helped to end—with the support of some brave reformers in the Ukraine Government. This was before the accession of Mr Zelensky, and I know that his leadership is determined to avoid a return of this kind of practice. However, it means that the detailed arrangements for the loans need to be clear and transparent, so I have some questions to ask the Minister about the practical application of the Bill.
First, can he outline for the House the specific mechanisms by which our UK loans will be distributed and managed? Ensuring that this significant financial commitment is deployed in a timely way will be critical to achieving the desired impact.
Secondly, what parties will be involved in the transfer of these loans? Will the money be transferred directly by HM Treasury to the Government of Ukraine, will it be added to a shared pot with the G7 or will the Government use a third party, as the US is doing, which in our case might be a law firm, a specialist bank or some other body?
Thirdly, I have a novel point since we will have a new United States President in a matter of days. He has expressed a determination to bring the war in Ukraine to an end, so we need to reflect on the ramifications for this Bill. Any Trump deal might contain financial provisions. The Government need to be vigilant in ensuring that any terms ensure that the repayment of the sums provided by the Treasury continues—otherwise, there will be a substantial and unplanned cost to the UK taxpayer. The Minister will wish to comment and let us know whether the arrangements planned make that a needless concern, as I very much hope.
As we provide financial aid, we must also remain vigilant about the broader security implications of this conflict. The war in Ukraine is a stark reminder that the peace and stability we often take for granted are not guaranteed but must be actively defended. The international situation is more concerning by the day, whether in the Middle East, North Korea or the South China Sea. In recent weeks, NATO chiefs have issued warnings that the alliance must increase defence budgets to match the levels of threat we face. The new US President has called for a major increase in spending by European states, so this is a matter of key concern. The Government are yet to announce when they will reach the target of 2.5% of GDP on defence spending, a figure that many influential observers now consider to be too low. There is a strong case for speeding up this announcement. Perhaps the Minister will be kind enough to update us on the Government’s plans.
Furthermore, it is vital that we take a long-term view on this issue. Have the weapons that we have sent Ukraine been replaced? While immediate military aid to Ukraine is crucial, we must also ensure that our own Armed Forces are adequately equipped, trained and funded to address a broad spectrum of potential threats. This includes not only conventional military readiness but investments in emerging domains, such as cyber defence, where adversaries are increasingly active.
Although the moneys under discussion today do not come out of the defence budget, it is important, in an increasingly dangerous world, to focus on our defence. Can the Minister reassure the House that the Government remain fully committed to raising defence spending to 2.5% of GDP as soon as possible?
In conclusion, supporting Ukraine is not only a moral imperative but a strategic necessity. This Bill, which we support, represents a new step in reinforcing our commitment to Ukraine’s sovereignty and independence. However, it is incumbent upon us, as legislators, to ensure that this financial assistance is delivered effectively and transparently. I look forward to hearing from all noble Lords and to receiving answers to my questions from the Minister. Let us together send a clear and united message that the United Kingdom stands firmly with Ukraine.
Baroness Smith of Newnham (LD)
My Lords, from these Benches, as always, I associate my comments with those of the Minister and the noble Baroness, Lady Neville-Rolfe, on our unwavering support for Ukraine. One thing that has been notable over the past almost three years is the extent to which there has been unwavering cross-party support for Ukraine. The previous Government were clear in their commitments and the present Government are making the right noises and the right commitments to Ukraine. I welcome the Minister’s tone in seeking to reiterate that support for Ukraine in opening the debate.
As the noble Baroness, Lady Neville-Rolfe, reminded us, this is not just a question of Ukraine and its sovereignty but a wider issue. I would like to take the discussion a little beyond the G7 and further than the Official Opposition position. The Liberal Democrat Benches would like the Government to consider going further and seizing frozen Russian assets—to go beyond spending the revenue, which is welcome, and look at the assets.
We are wholly committed to the Bill and do not in any way wish to delay it. It needs to go through today to demonstrate the commitment to the G7 agreement and to allow the £2.26 billion British loans to go forward, but we would like the Government to think again. My understanding is that the regret amendment in the name of the noble Lord, Lord Blencathra, may be about going further. From these Benches we would like to go further but not at the expense of delaying the Bill, which would not be appropriate.
As part of the international community, we have given much support to Ukraine. As we have heard, the United Kingdom has given significant military support and financial aid. That is vital. As the noble Baroness, Lady Neville-Rolfe, said, if our renewed commitments and the loans go towards military defence for Ukraine, that will be welcome. At the same time, as the noble Baroness pointed out, we need to reassure ourselves and the country, as well as our NATO allies, that we are committing sufficient resources to our own defence. There is a very real concern that our defence expenditure is too little and our Armed Forces are too small, not adequately resourced and without sufficient equipment. The 2.5% commitment is essential.
Is the Minister able to help the House understand when the spring fiscal event may happen? One thing about parliamentary or governmental time is that it does not necessarily fit with a standard calendar. For most of us, spring starts either on 1 March or in late March, depending on which approach you take and whether you look to the moon or to the calendar. For the Government, sometimes an Autumn Statement has happened in late December. Can the Minister reassure the House that a spring fiscal event might happen well before Easter and will ensure not just that the £3 billion in military support for Ukraine is still in place but that His Majesty’s Government are not making any cuts to defence, providing us with a clear timeline for 2.5% of GDP for defence?
Earlier in the week, there was discussion in the other place about the Chancellor’s visit to China and the fact that, since taking over last July, the Prime Minister has been very active on the international scene. It is very welcome that Government Ministers talk frequently to our partners and allies in the G7 and NATO, and to the wider international community. The discussions with China are perhaps a little more unusual.
Is the Minister able to tell the House whether the Chancellor was able to talk to China about the sanctions that have been imposed? While the Minister was very clear that we need to work with the G7 and the European Union in terms of the imposition of sanctions, those sanctions would be so much stronger if China were also fully on board.
Further, what conversations have the Foreign Secretary, the Prime Minister or the Chancellor—or indeed any other Minister—had with our Commonwealth allies? While the response from the West, including the United States, so far to the Ukraine crisis has been very strong, the support from our Commonwealth partners has not been so strong. If the international relations in which the Government are currently engaged are really to be as effective as they might be, using the opportunity to engage with our Commonwealth partners to try to explain to them the importance of the sanctions regime and the importance of supporting Ukraine would reinforce the United Kingdom’s place on the international scene and help us give additional support to Ukraine.
In short, from these Benches we support the Bill, but we would like to see the Government go further and use all the tools at their disposal, diplomatic as well as military and financial, to give Ukraine as much support as we can as it reaches the third anniversary of the Russian invasion.
Lord Blencathra
At end insert “but regrets that the Bill as introduced does not include provisions to allow immobilised Russian state assets, reserves, or any other property to be used to fund financial assistance to Ukraine”.
Lord Blencathra (Con)
My Lords, I beg to move the regret amendment standing in my name on the Order Paper. I too am looking forward to the maiden speech of the noble Baroness, Lady Batters, and her take on the situation in British agriculture at the moment, which is quite interesting.
Let me make it absolutely clear that I will not press my regret amendment to a vote. I will do nothing to delay the passage of this Bill and, in the highly unlikely event that there is a vote on the Bill, I shall vote for it. I support the Bill, but I have had to adopt this tactic because I cannot table a simple amendment I would like—because it is a money Bill—to add a little additional power to the Bill. I simply cannot understand why the Government are not taking that power, as the United States and Canada have done. Having said that, I congratulate the Minister on his speech and congratulate the current Labour Government for being as robust on Ukraine as my right honourable friend Boris Johnson was when this appalling war first started. I
I am proud of the financial assistance that this United Kingdom has already provided to Ukraine. We have committed £7.8 billion in military support and £5 billion in non-military support. In hard cash terms, the United States has given $135 billion, Germany $16.5 billion and I think our £12.8 billion is $15 billion. However, in terms of GDP we find that Estonia has committed 3.5% and Denmark 1.8%. Norway, Lithuania, Latvia, Finland and Poland also stand out as the highest donors in terms of GDP. The closer you are to Russia, the more you have to fear and the more you spend on defeating the aggressor. In GDP terms, the US contribution is only 0.32%, Germany’s is 0.57% and we are at 0.55%.
Nevertheless, in these difficult financial times we have done a remarkable job in assisting. Of course, as the Minister pointed out, we have done other things as well. We have trained over 51,000 Ukrainian troops and sent over 400 different types of military capabilities and kit, including drones, boats and munitions. Defeating Putin is a point the United Kingdom—including the present Government—repeatedly makes at the United Nations and we have imposed sanctions on over 2,100 individuals and entities, including 100 ships and shadow tankers. We are taking a leading role in the recovery and reconstruction of Ukraine, co-hosting the London Ukraine Recovery Conference in 2023.
Then we come to the G7 summit in Italy in June 2024, which is the father of the Bill before us. The official communiqué said:
“We, the Leaders of the Group of Seven … gathered in Apulia … reaffirm … Ukraine’s fight for freedom and its reconstruction for as long as it takes … we decided to make available approximately USD 50 billion leveraging the extraordinary revenues of the immobilized Russian sovereign assets, sending an unmistakable signal to President Putin”.
The important words there are
“leveraging the extraordinary revenues of the immobilised Russian sovereign assets”.
So what are those assets? The figures vary, but total immobilised Russian assets are believed to be from $280 billion to about $300 billion. About $240 billion is in the EU, up to $28 billion to $30 billion in the United Kingdom and the rest elsewhere. The US does not have much at all. The $50 billion loan will be advanced to Ukraine under the G7’s extraordinary revenue acceleration scheme—the ERA—and is due to be paid back to lending countries from the interest that we are making from those immobilised Russian assets. The UK, as the Minister said, is about to extend our share of £2.26 billion under the ERA loan scheme, to be repaid from approximately 15 years-worth of interest on those Russian state assets that have been immobilised in the EU.
That $50 billion in ERA loans is, however, merely a temporary financial buffer. It falls far short of addressing Ukraine’s long-term needs, with damage requiring reconstruction surpassing $486 billion, according to the World Bank’s February 2024 assessment, and western contributions to Ukraine’s defence expenditure of roughly $105 billion annually.
The little amendment that I wanted to make to this Bill was simply to add after the words “money provided by Parliament” a sentence that said, “or out of any assets, reserves or any other property held within the jurisdiction of the United Kingdom directly or indirectly by, for or on behalf of the Russian Federation”. That would permit us, if we so decided—it is a permissive power—to utilise the whole of the $30 billion of Russian assets that we have. I am very happy to use taxpayers’ money in the Bill, but I am more keen to use Russian money. The whole purpose of my amendment today is to ask the Government: why on earth not take that permissive power to utilise Russian assets? Why are those words not in the Bill?
Since it is morally and legally right in international law to keep the Russian money immobilised but spend the interest raised on it to help the reconstruction of Ukraine, it must also be legally right in international law to spend the capital assets themselves to help Ukraine. Canada and the United States have taken this path. In 2022, Canada introduced legislation that enables its Government to seize state and individual assets frozen in Canada in cases of grave breaches of international peace and security. In 2023, the United States passed the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act—the REPO Act—which allows immobilised Russian sovereign assets seized and transferred under US jurisdiction to be sent to Ukraine.
Some have suggested that our Treasury has blocked this because of a misguided fear that it will deter foreign investment in the City or the UK, since it could send a message to foreign investors that the UK will suddenly seize their assets without good reason. That is just not the case and is not going to happen. The concerns that seizure would lead to the withdrawal of global reserves held in the G7 currencies and their ultimate devaluation are grossly exaggerated. The practical impact of indefinite immobilisation, as we have done, and confiscation is exactly the same. Three years of immobilising these Russian assets have not led to a flight of capital from the US dollar, the euro or Great British pounds, and there are no grounds for believing that confiscation will have that effect either.
In January 2024, the United Kingdom and Ukraine signed an agreement on security co-operation. Among the 66 paragraphs or articles were the following:
“The Participants reaffirm that the Russian Federation must pay for the long-term reconstruction of Ukraine. Russian sovereign assets in the UK’s jurisdiction will remain immobilised until the Russian Federation has paid for the damage it has caused to Ukraine. The UK, working with its partners, will continue to pursue all lawful routes through which Russian assets can be used to support Ukraine … As a priority, the Participants will continue to work together with others, including G7 states, to explore options for the development of appropriate mechanisms to provide reparation for damage, loss, or injury caused by Russian aggression”.
That is what the last Government said, but what do the current Government say? It seems exactly the same, I am pleased to say.
On 6 December last year, in answer to a Written Question from my noble friend Lord Banner, the Minister said:
“This Government is clear that Russia must be held responsible for its illegal war. That includes its obligations under international law to pay for the damage it has caused in Ukraine. Working with allies, we continue to pursue all possible lawful avenues by which Russia is made to meet those obligations. Our agreement with G7 partners to provide approximately $50 billion in additional funding to Ukraine, repaid by the profits generated on sanctioned Russian sovereign assets, is an important step towards ensuring Russia pays.”
Note the words, “an important step”—not the only step. The only way that Russia can be made to pay is to use all the immobilised assets held in the UK, EU and US. These should be transferred to an international fund, as the Council of Europe has called for.
It is morally right to use those assets; it is legally right under international law to use those assets. The whole point of my Motion today is to plead with the Government to take those permissive powers, to use when the time is right. Will the Government please explain to me and the House in more detail why they are not taking that route? I beg to move.
Lord Browne of Ladyton (Lab)
My Lords, it is a pleasure to have the opportunity to rise to offer unambiguous support for this Bill. I thank my noble friend Lord Livermore, the Financial Secretary to the Treasury, for his characteristically clear introduction to this debate. I, like others, am looking forward to the maiden speech of the noble Baroness, Lady Batters. I am pleased to follow the noble Lord, Lord Blencathra, and to commend him for the same reasons my noble friend the Minister did: his consistency and his contribution in this area, with particular reference to the issue that informs his regret amendment—which I regret I cannot support. I will come back to that in a few minutes.
This is a short Bill, but one freighted with enormous consequences, as we have heard from the contributions thus far, which were characteristically cogent for your Lordships’ House. It gives effect to our commitment to devote £2.26 billion to the G7 extraordinary revenue acceleration loans to Ukraine scheme, the ERA. This is separate from the £3 billion of military aid that we will also provide this year. I applaud Ministers for their decision to hypothecate these funds and to ensure that they are directed squarely to military procurement.
It is worth being clear-sighted about the purpose of this disbursement. It is to enable Ukraine to stand against unprovoked aggression and to ensure that the new era of great-power competition that is already upon us does not see the normalisation of such aggressive expansionism—a course taken by powers who see their own strength as justification enough for such actions. It is clear that the incoming US Administration cannot necessarily be relied upon either to shoulder its share of the burden in the provision of military support for Ukraine, or indeed to enforce international norms around the appropriate behaviour of great powers or aspirants to that status.
Last week, the President-elect offered a justification for his threat to annex Greenland either by force or via economic pressure. In a somewhat circular piece of logic, he asserted that such a course of action is justified by the fact that the US “needs” Greenland for its economic security. Although Putin’s speech that launched the invasion of Ukraine was more rococo in style, the central message was remarkably similar: that Russia had the moral right to invade to protect its own security interests. In making this comparison, I emphatically do not suggest a scintilla of moral equivalence between the two men or the countries they represent. But taken together, the US, Russia and China will help shape the new norms of this era of great-power competition. As we debate this Bill, we have to ask ourselves what lessons President Xi, for instance, will draw from recent history as he contemplates what he considers to be the daily annoyance of a free and independent Taiwan.
Being mindful of these precedents is one of two reasons why I believe this Bill and our wider aid for Ukraine is important. The other is the state of public opinion in western Europe. In democratic politics, public opinion today is in general a pretty accurate guide to the attitude of leaders tomorrow. That being the case, polling conducted by YouGov in December makes sobering reading. It reveals that in seven key European countries, including our own, support for continuing assistance for Ukraine has fallen markedly. Equally, support for ceasing support and reconciling ourselves to a compelled peace, even on terms markedly unfavourable to Ukraine, has increased.
To some extent, this is a consequence of the more ambivalent US attitude Europeans expect from the new Administration when they take office. The figures are striking, none the less. In Germany, Spain, France and Italy, support for continuing assistance to Ukraine is now lower than for concluding a peace favourable to Russia. Even in Britain, there is only 4% between the two options.
Concerning though these figures are, the purpose of government is not to act as a weathervane reflecting public opinion but to lead it. I applaud the efforts of Ministers in the previous Administration—not least the noble Lord, Lord Ahmad, who I regret is not in his place to hear this—in the support they afforded Ukraine. I also have complete confidence in the Ministers on our Front Bench and in the other place; I am sure they will prove equally adamantine in their resolve.
What Ukraine needs is constancy, and the mechanism to which this Bill gives effect provides that. An ebbing of our support and that of our allies would lead to a collapse of the rules-based international order, a spiralling refugee crisis and the subjugation of a free and sovereign people. It would be not only morally wrong but run counter to our own interests and those of any country which values stability and collective security.
In 1941, President Roosevelt gave one of his celebrated fireside chats in which he described the US as an “arsenal of democracy”. It contained some words which apply to our situation, as they did to his:
“We have furnished … great material support and we will furnish far more in the future. There will be no ‘bottlenecks’ in our determination … No dictator … will weaken that determination by threats of how they will construe that determination”.
It is in that spirit that I offer this Bill my unambiguous support.
There is more to do in exploring the use of frozen Russian assets, but that lies outside the scope of this legislation. I am sure that those who support that ambition and who are yet to speak, or who will speak on other occasions, are aware that there was a Back-Bench debate on this issue in the other place, led by the Liberal Democrat Mike Martin, on 6 January. I draw noble Lords’ attention—I am not stepping in for the Minister; he is perfectly capable of doing this himself— to column 671 of that debate. Stephen Doughty, the Minister of State at the Foreign, Commonwealth and Development Office, responded to the debate. I will read the following passage in full to your Lordships:
“The fundamental questions about what more we can do to use Russian assets for the benefit of Ukraine were at the heart of the debate. The Government and our G7 partners have repeatedly affirmed our position. Russia’s obligations under international law are clear: it must pay for the damage it has caused to Ukraine. The ERA loan and our contribution will ensure that Ukraine can receive the financial support that it needs now—it was right to focus on getting that out the door, because we urgently need to support Ukraine now—with the profits generated on sanctioned Russian sovereign assets providing that. I reassure colleagues throughout the House who have rightly asked a lot of searching and challenging questions that we are committed to considering all possible lawful avenues by which Russia can be made to meet its obligation to pay for the damage it is causing to Ukraine. We continue to work with allies to that end”.”.—[Official Report, Commons, 6/1/25; col. 671.]
Thereafter, the contributions, few that they were in that debate, were supportive of that position, as I am.
It is in the spirit of President Roosevelt that I offer the Bill my unambiguous support. I am proud that we have devoted to Ukraine more assistance than any other single country save the US and Germany, and trust that we will continue our support, conscious that Ukraine is not defending merely itself but the UK and all its European allies and friends.
Baroness Anelay of St Johns (Con)
My Lords, I strongly welcome the Bill. It gives a clear signal of our continuing commitment to the people of Ukraine and our defence of European security. We are reminded every single day of the appalling impact on Ukraine of President Putin’s illegal and unprovoked invasion.
Today, the Minister has given us a very clear and welcome exposition of the purposes of the Bill. It is quite simply to unlock the UK’s contributions to the G7’s extraordinary revenue acceleration scheme by using the extraordinary profits generated on immobilised Russian sovereign assets held in the EU.
I was interested in paragraph 6 of the Government’s Explanatory Notes for the Bill. That makes it clear that the Government consider that the legal basis for this UK action—and I welcome that—is rooted in EU regulation 2024/2773, which was adopted by the European Parliament and Council of the European Union. Paragraph 6 states:
“This provides a legal basis within the EU for the UK to receive repayments from the ULCM, from the extraordinary profits on the immobilised assets, proportionate to the UK’s contribution to the initial funding for Ukraine provided by the G7 as a whole”.
That contribution was $3 billion. I was just thinking about what my noble friend Lord Blencathra said. When I read this, I found it both intriguing and potentially encouraging for future legal action, and I emphasise “legal”.
Paragraph 14 of that European regulation offers two routes by which the UK, as a post-Brexit third country—in EU parlance—can legally make payments to assist Ukraine. First, it says:
“It should be possible to support the Mechanism by providing extraordinary revenues stemming from the immobilisation of Russian sovereign assets held in relevant jurisdictions other than the Union. To that end, it should be possible for third countries or other sources to contribute to the mechanism”—
so far, so good indeed. Secondly, it says:
“Furthermore, it should be possible for third countries to directly use extraordinary revenues stemming from the immobilisation of Russian sovereign assets within their jurisdiction to reduce the repayment needs of any respective bilateral loan provided to Ukraine, thereby supporting the Mechanism by reducing the total level of support that would be required for that loan”.
My question, therefore, is: can the Minister confirm today—just for clarity for the House—which of those two avenues has been adopted? I appreciate that we are following an absolutely legal route.
Of course, I welcome the fact, as the Minister explained earlier, that we are using the contribution that we are making for improving even further our contribution to the military needs that Ukraine has to defend itself. I welcome everything he said in that regard. Like my noble friend Lord Blencathra, I am tempted now—and I go beyond temptation—to range a little more widely. I am grateful to the Minister for giving such a very clear explanation and for adding—as was alluded to by the mention of the comments of the Minister in the other place—that the Government were open to other options, subject to genuine conditions about legality. Of course, I hope that if an agreement were to be reached within the G7 in the future that said that the Russian sovereign assets themselves could be seized and used to assist Ukraine, that might provide a legal basis on which we could then fulfil what my noble friend has put down in his amendment to the Motion today.
I recognise what my noble friend on the Front Bench Lady Neville-Rolfe said about how one has to be very careful and look at the consequences. However, I have in mind the response to a Question that I put to my noble friend Lord Cameron of Chipping Norton— I think that my noble friend knows what is coming—when he gave evidence to the European Affairs Committee just over a year ago. In this regard, I asked him how we could go further and what the Government were doing—this was the Conservative Government in December 2023 —to take some really gutsy action. I got a gutsy answer. He said in response:
“We are in a real fight for the sort of security on our continent that we believe in, and extraordinary times require extraordinary measures, so I am instinctively in favour of trying to do this”—
that is, to get agreement with the G7 to go further. I have to ask the Minister whether he is also “instinctively in favour” of trying to go further—within international law. I always agree with that.
To go a little more widely still, UK Governments, both Conservative and now Labour, have been admirably consistent in their imposition of sanctions on those who support the illegal invasion of Ukraine, either directly or indirectly. In relation to that, I will refer very briefly to the unresolved matter of Mr Abramovich’s delaying tactics to avoid fulfilling the commitment that he made way back in March 2022 to use the £2.5 billion of frozen assets arising from his sale of Chelsea Football Club that he promised in support of Ukraine.
For over a year now I have been asking Ministers in both Conservative and Labour Governments during evidence sessions in the European Affairs Committee why we have had to wait so long and still nothing seems to happen. We do not seem to be able to break through Abramovich’s prevarication and obfuscation and hold him to his promise. The response from Ministers in both Governments has been that they are thoroughly determined—they are on the case, and they want to ensure that the long-promised charitable foundation will be established and deliver funds to those in need in Ukraine, both now and during the reconstruction of the devastation caused in Ukraine by Russia. Can the Minister update us? Is there any progress with this negotiation with Mr Abramovich? If the Minister is not in a position to answer my questions today, I will not try to hold up the debate any longer—I just hope that he will write to me.
I look forward to the noble Baroness, Lady Batters, giving her maiden speech, and I look forward to the Bill getting Royal Assent ASAP and the money reaching those who need the extra-military defence in Ukraine.
Lord Beamish (Lab)
My Lords, I join other noble Lords in looking forward to the maiden speech of the noble Baroness, Lady Batters. I represented a rural constituency in the other place for 23 years, I worked with the NFU, and I know the effectiveness of her leadership of that organisation. I am sure that she will bring to this House not only her knowledge of the farming sector but her passion for it.
Next month, we will see the third anniversary of Russia’s illegal and brutal invasion of Ukraine. Few people imagined back in February 2022 that Ukraine would be able to resist its much more powerful neighbour and the brutal way in which it invaded a sovereign state—but it has, which is down to the determination of the Ukrainian people, along with the bravery and innovation shown by its armed forces.
That is why I welcome today’s Bill to help the Ukrainian people to continue to resist aggression and to defend the principle that a sovereign nation’s territory should never be taken by force. That principle was one of the cornerstones of the international rules-based order that came out of the ashes of the Second World War, which is today being defended on the battlefields of Ukraine. Along with the determination of the Ukrainian people, the financial support provided by the UK, US, Europe and international partners has been vital in resisting Russian aggression.
The agreement by the G7 is an example of why our membership of international organisations is so important. That collective effort and endeavour not only keeps us safe but means that our voice is stronger when it is deployed with those who share our values and interests. Three years into the war, this Bill and the efforts of the G7 send a very clear message to Russia that its aggression will continue to be resisted. As a member of the NATO Parliamentary Assembly, I also know from our meetings with Ukrainian parliamentarians that the single voice that is put out by the UK Parliament is very much appreciated by Ukraine. I am pleased to see that, today, that is again echoed in the cross-party support for this Bill.
The $50 billion produced by the agreement by the G7 will provide vital funding for Ukraine to support its military, humanitarian and—as already outlined in the debate—economic recovery. The UK’s £2.6 billion contribution to the ERA fund will be earmarked for military procurement to bolster Ukraine’s self-defence. We can look at the way in which Russia has indiscriminately fired missiles into Ukraine’s civilian population to see why that investment is important. As the Minister said, this is in addition to the £12.8 billion that the UK has already given in support of Ukraine. It is also in addition to the support given by ordinary men and women in this country who opened their doors to Ukrainian refugees in the early stages of the conflict.
The unique nature of this agreement means that the loan will be paid not by Ukraine but from the extraordinary profits made on sanctioned Russian sovereign assets that are held by the EU. As we know, many of those assets, both private and state, will have been stolen from the Russian people to benefit the elites around Putin. The sanctions and asset freezes, as the Minister pointed out in his opening address, have been an important tool in limiting the Russian aggression in Ukraine, not only by the Russian state but, it can be argued, by individuals who are perpetuating the myth that Ukraine is part of sovereign Russia.
More needs to be done, however, whether controlling Russia’s use of its grey tanker fleets to evade oil sections or the export of UK and EU goods through third countries to Russia to avoid sanctions. Sanction-busting exports range from electronic goods that are useful to the Russian military all the way to Rolls-Royce motor cars. What more can be done to clamp down on this circumvention of sanctions, not only through exporting to third countries but through companies in this country whose products are still ending up in Russia?
I do not know whether the Minister saw the article in the latest Sunday Times about the export of Rolls-Royce cars to Russia. In it, Chris Brownridge, Rolls-Royce’s chief executive, commented that there was no evidence of its dealers breaking sanctions. Considering the unmistakeable evidence that Rolls-Royce motor cars are still appearing in showrooms in Moscow, this seemed quite a pathetic response; he clearly does not have a very inquiring mind in asking how they are getting there. Rolls-Royce cars may be one of the more visible signs of sanctions evasion, but we know that components for electronic and other goods are being sent through third countries to Russia to help in the building of components for military equipment, which is then being used in Russia’s war in Ukraine.
I have some sympathy with the amendment tabled by the noble Lord, Lord Blencathra. More needs to be done on how we free up these assets. We also need to look at what else can be done to find assets in this country that have clearly been used and salted away with third parties to avoid sanctions or freezing.
I once again welcome the Bill and the continuing cross-party support for Ukraine in its struggle against Russian aggression. This will be a clear message from both this House and the other House that Russian aggression will be resisted, and that Ukraine has our full, united support.
Lord Banner (Con)
My Lords, I too support this Bill. As has been said, it will enable the payment to Ukraine of the UK’s share of the $50 billion financial assistance package agreed by the G7 in summer 2024. I congratulate the Government on bringing it forward.
However, I also emphatically support my noble friend Lord Blencathra’s regret amendment that the Bill does not also contain a provision allowing the transfer of the circa £30 billion of immobilised Russian state funds located in the UK. As my noble friend said, the noble Baroness, Lady Chapman, stated in response to a Written Question that I tabled before Christmas that the provision of the $50 billion loan, backed by the interest made on the immobilised Russian assets in the EU was
“an important step towards ensuring Russia pays”.
This is right, but it is only the first such step. I find it hard to understand why, having agreed to use the profits from the immobilised Russian funds, the Government are not now taking the opportunity to legislate at least through enabling powers and at least for the possibility of transferring the entire amount of Russian immobilised funds to Ukraine. Again, as my noble friend said, if there is a legal way to transfer the interest, it follows that there is a legal way to transfer the capital. In banking law terms, the interest and the capital are owned by the same person. There is no coherent basis for a legal distinction between the two in this context.
About a year ago, the previous Foreign Secretary, my noble friend Lord Cameron of Chipping Norton, confirmed his view that there is a legal route to seizing and transferring the entire amount—and rightly so. I explained the legal basis when I last spoke on this issue in the House before Christmas. The current Government have told us repeatedly that the issue is being considered—or “actively considered”, as the Minister put it. Will he please confirm how much longer this process of consideration is going to go on before a decision is actually taken?
With respect, there comes a point when protracted consideration may start to be perceived as dithering, and I suggest that we are not far off that point. I hope I am not right to fear that the Government may be disinclined to use the independence that the UK now has following withdrawal from the EU to take a lead on this issue, instead preferring the herd mentality of waiting until Europe finally has a collective position on the subject—if it ever does.
Either way, whether I am right or wrong in that fear, Ukraine cannot afford to wait—that is the important point. The $50 billion loan will provide vital support and is of course to be welcomed, but how long will it provide that support for? The money will literally be used to keep the lights on during the war, but Ukraine’s wartime budget deficit is around $40 billion per year. Even taking into account other sources of financial support, the loan will last through this year and no further.
It will also not fund any military support for Ukraine, an issue that is becoming increasingly pressing in light of the return to the presidency of Donald Trump in the US in a few days. According to the US Government, the US has provided some $93 billion in military support since the start of the full-scale invasion, as my noble friend explained. Should that stop or be reduced, funds will have to be found to plug the gap. It has often been rightly said by the Government, in this House and elsewhere, that it must be for the people of Ukraine alone to choose how much longer the war goes on for. But without the right support, it is not a meaningful choice; these are empty words without the support that Ukraine needs.
I commend and welcome the Minister’s comments that we must support Ukraine for as long as it takes, no matter how much it costs, but those comments need to be translated into actions, and it surely must be Russia and not the British taxpayer footing the bill, as far as we are concerned.
The illegal war in Ukraine is in its third year or, for those from the east of Ukraine or Crimea, its 11th year —it has been going on since 2014. It is now a war of attrition. Only this week, the Financial Times reported that Russia’s war economy is on the edge of collapse, as “a house of cards”. The western sanctions are working. Our task must now be to convince Putin that the Russian economy would not be saved by giving him back the immobilised funds as some sort of prize or reward for ending the war. The only resilient response and future-proof way of ending this war is if Putin knows that unless he stops for good and does not repeat the actions of the last 10 years, he will lose his grip on Russia’s economy completely and, with it, his grip on power.
I urge the Government to catch up with the US and Canada and finally introduce—as they have done—legislation permitting seizure of Russian state funds, if only to send a clear message to Russia that waging a war of aggression does not pay and that there will be serious consequences for the continued flouting of international law. Let us not wait any longer: let us get on with it and show leadership on the global stage on this issue. The Bill is a missed opportunity to do that, and I urge the Government to bring forward the necessary legislation without delay. I now very much look forward to hearing the maiden speech of the noble Baroness, Lady Batters.
Baroness Batters (CB) (Maiden Speech)
My Lords, it is a great honour to address this House for the first time, and I thank the Minister and the noble Baroness, Lady Neville-Rolfe, for their kind words.
In March 2022 I had a request to speak with Mariia, director of the Ukrainian Agrarian Forum. I will always remember that first call. Mariia talked of farms, miles away from towns and villages, being individually targeted: poultry sheds and dairies bombed and destroyed; cows and calves left to burn alive; and fields planted with crops that were deliberated mined to destroy the farmers and the harvest. Russia stopped exporting nitrogen fertiliser three months before the illegal invasion of Ukraine, and your Lordships’ House should be under no illusions that the war in Ukraine is as much about food as it is about territory—and this at a time when England was paying farmers not to produce food.
As an ambassador of Farm Africa, I dedicate my maiden speech to the many farmers I have met across the world, and especially the 46,000 members of the National Farmers’ Union that I was privileged to lead. The NFU is an organisation led by farmers for farmers. Its great strength is the professional team of staff that I was fortunate to work alongside, and I am delighted that a few of the London team are in the Gallery today.
I am a fifth-generation tenant farmer on the Longford Estate in Wiltshire. We have a herd of Aberdeen Angus cross suckler cows and grow spring barley and British cut flowers, alongside a wedding barn and holiday cottages. Back in 2010 I became the NFU county chairman of Wiltshire, a role I very nearly did not take on due to my fear of public speaking. I hope the fact that I was elected as the first woman to lead the National Farmers’ Union in 118 years gives hope to others that fear of failure can be overcome.
Having four Prime Ministers—three in one year—was challenging, but for me 2020 was the standout year. In March we left our NFU headquarters in Stoneleigh Park, Warwickshire, to work from home. My twins’ GCSEs were cancelled. Prime Minister Boris Johnson and President Trump planned to conclude a UK-US trade deal by August. There was one point, at the beginning of lockdown, when the Government thought we would run out of food. I remember a text from a Government Minister that read, “You can have as many people and as much money as you want, as long as we don’t run out of food”. For a few days, the reality of being seven meals from anarchy was very real. Farmers were key workers then, and I am enormously proud of the role the NFU played, working with government, to keep the country fed.
Brexit posed the ending of farming under the common agricultural policy. Farmers in England are nearly at the end of the transition into the environmental land management scheme. In this time, we have rewritten primary legislation for farming in England into the Agriculture Act 2020, raising the standards of environmental protection and animal welfare above those of the European Union. It was and remains an unacceptable contradiction to raise standards for farmers here and not for our trading partners.
Our history is littered with either embracement or abandonment of whether producing our own food matters. The Arab spring was the last time that government advisers and scientists gave serious thought to our role in delivering global food security. Post the financial crash of 2007 to 2009, the markets took off. Since then, the line given by officials is that the UK is a wealthy nation and can afford to import its food. The increases in farm taxes proposed in the Budget are a symptom of this all too often desk-based advice to Ministers. On this issue I urge the Government to listen to my successor, Tom Bradshaw, to pause and to consult with the industry. With so much change in the last six years, farming and our food security are at a major crossroads. Much will depend on the Government delivering their manifesto commitment to make food security national security.
I would like to finish with three points. First, the global population is set to rise to 10 billion by 2050. We will need to produce 50% more food with half the water and energy we have now. To achieve this, farmers will need access to the best science and innovation. Government must invest in and incentivise the optimisation of sustainable food production. The UK, with its maritime climate, should be producing much more of its own food. With targets for renewable energy, housing, nature, trees, water and air, it is wrong that we still have no target for food. Instead, we continue to rely on countries such as Spain and north African countries to produce so much of our salads, fruit and vegetables. It is unsustainable, both for them and for us.
Secondly, food and nature must become mutually inclusive. I am opposed to any form of nature bank. Instead, we must enable these vital environmental markets to come to fruition. Nature reserves are the jewels in the crown but they are a minuscule area, less than 8% of land in England. Over 70% of the country is farmed and can deliver food, nature and biodiversity net gain within a farmed landscape, at the scale that is needed.
Finally, I ran a catering business for 25 years. I am passionate about good food and cooking from scratch. Learning how to cook, for every child, should be as fundamental as maths and English in the school curriculum. The principles of a garden city should be applied to every urban area—orchards, allotments and beautiful green spaces for everyone, everywhere.
I conclude by thanking the amazing people who have helped me on this journey: the Defra Minister the noble Baroness, Lady Hayman; former Prime Minister Rishi Sunak; and my supporting Peers, the noble Duke, the Duke of Wellington, and the noble Lord, Lord Soames. And enormous thanks to every single member of staff: Black Rod, the clerks, the Doorkeepers, the security staff and the catering staff, who most certainly do know how important food is to this House. Thank you—you have made me feel so welcome. Finally, my thanks to my family and those who work for me. Like all working mothers, the juggle is real and seldom mentioned. So, to my own mother and my two children: thank you so much for the sacrifices you have made on my behalf.
Baroness Wheatcroft (CB)
My Lords, what an honour it is to follow such a brilliant maiden speech. Clearly, the noble Baroness, Lady Batters, has overcome any fear of public speaking. What she is not afraid of is bringing not just her knowledge and intelligence but her emotion to this Chamber, and we should applaud her for it. It will be an honour for the Chamber to have in its presence a woman who has brought such change to the farming industry, who has been a voice that many of us will have been very familiar with. I feel that I have woken up with Minette Batters over many years, courtesy of Radio 4. Now it is a delight to see her here among us and to listen to her impassioned speech on behalf of an industry to which she has given so much.
We should be aware that the noble Baroness is a co-founder of Ladies in Beef. Even women who are not great meat-eaters may feel that that organisation gives them something to strengthen their resolve in holding their own in what may still, for some, be a bit of a man’s world. I am also intrigued to see that she has chosen to be the noble Baroness, Lady Batters, of Downton. No abbey was mentioned, but perhaps there is a new series in the making—I am sure we will all look forward to it. I also thank the noble Baroness for bringing the attention of the Chamber to the plight of farming in Ukraine, the importance of farming to all of us, and the importance of food security—which, of course, brings me to the Bill.
I welcome the Bill as far as it goes—but how much further it could and should go. The money pledged in it is a fraction of what Ukraine needs. Restricting the funds involved to the income that would be generated by the Russian assets frozen in the EU is simply not enough. Others have already talked about this. Huge Russian assets have been frozen which should be handed to Ukraine as quickly as possible.
The noble Baroness, Lady Neville-Rolfe, voiced concerns about such a move, but even some of her colleagues in the other place have come to this conclusion and have voiced their views not only there but in a letter to the Times on 6 January. They say that there is at least £25 billion in UK accounts which the Government should hand over, and now. The noble Lord, Lord Blencathra, made an eloquent plea for the UK to be braver, and I commend his stance, although, like him, I would not wish to do anything to jeopardise the Bill directing funds to Ukraine as quickly as possible. The noble Baroness, Lady Smith of Newham, raised this issue too.
There are those who have qualms about the legitimacy of a country not only freezing another’s assets but seizing them. However, that view is based on the concept of sovereign immunity, and I argue that Russia has forgone any right to such immunity. Many will feel that Putin’s outrageous assault on Ukraine is enough to have cost it any immunity. But it is Russia’s behaviour in the UK which surely has eradicated any such rights. Russian operatives have come to the UK with the sole purpose of committing murder. Whether it was the poisoning of Alexander Litvinenko or the Salisbury poisonings, they showed no respect for the sovereignty of this country. Why, then, should we respect sovereign immunity in the case of Putin’s Russia?
If Canada and the US can be braver, as the noble Lord, Lord Blencathra, explained, can the Minister explain why the UK is still only considering its position on whether it can go any further on such a vital issue? It might be one small step towards redressing the unedifying reputation the UK has gained as a hub for dirty money. The “London laundromat” was a popular destination for Russia’s billions, which was often money obtained through dubious means. The former Prime Minister Boris Johnson was praised for his staunch support for Ukraine’s fight, and it is true that he was there at the beginning. But it was also Boris Johnson who, in 2010, as Mayor of London, opened a new department at City Hall devoted entirely to attracting Russian investment to London, and I beg to suggest that not all that investment came from the most respectable of sources. I am not sure that that was top of the list of priorities at the time.
Bill Browder has gained a very big reputation for his bravery in pushing through the Magnitsky Act in many legislatures around the world. He had good reason to do that, as he had fallen victim to the Russian state and his lawyer, Sergei Magnitsky, was murdered in jail in Russia—or at least, he died there, and it was thought not to have been accidental. Because of that, Browder has worked steadfastly to get people alive to exactly what is going on in that country and to take action, rather than just speaking about it.
One of the reasons that he cites, which others have not yet mentioned but which we really should be taking account of, is that, if this war is not won, it will precipitate a refugee crisis that will make the small boats look minuscule in proportion. The refugees will flood not from Ukraine but from all the neighbouring territories that are so fearful of what a powerful Russia might do next. The numbers are put at anything up to 25 million. That is one reason—if only one were required—why urgent action is required to get the money to Ukraine and to get it there quickly, handing over the income from the money that is held in the EU, let alone the UK. However, doing it in three tranches, as this Bill talks about, may be a start, but it is such a small start. Surely, the UK could and should do more.
Lord Balfe (Con)
My Lords, I add my congratulations to the noble Baroness, Lady Batters, on her maiden speech. I came across the NFU many years ago through my very good friend Lord Plumb, who introduced me to this Chamber. He taught me quite a bit about the NFU and mentioned the noble Baroness to me as one of the up and coming stars of the institution. I am surprised that she had difficulty with public speaking, but clearly she has overcome it extremely well. We all look forward to many contributions in this House, given her special knowledge of agriculture, Ukraine, Africa and other subjects.
You can always depend on me when we have a debate on Russia. I am the one who makes the speech no one wants to hear. Today, unfortunately, my two co-religionists, the noble Lords, Lord Skidelsky and Lord Campbell-Savours, are not present, so I am left to do this all on my own. My message has not changed over the years. My message is very simply this. We have all agreed that Russia was wrong to invade Ukraine. It does not take an O-level in geography to recognise that. But what we have not been very good at is looking at the consequences of where we are now and where we are heading to. We need to remember my good friend John Major’s advice: in a hole, stop digging.
We need to look at some perspective. The Minister in the Commons, Darren Jones, said that we were going to carry on until Russia ceases its war of aggression and we win. I will first ask a very simple question. What is “win”? I have seen no evidence of any movement in Crimea to go back into Ukraine. Nor have I seen any evidence from Luhansk or Donetsk to the same effect.
The Ukraine Government made, as I have said many times, a tragic and stupid mistake when it outlawed the Russian language in places where 100% of the people spoke Russian. That alienated the eastern provinces, and the chasing out of Viktor Yanukovych did the rest. We now have to live with the consequences and build for the future.
The extraordinary revenue acceleration is a Group of Seven agreement, but has it been implemented elsewhere? Is this particular programme on the statute book of the US Senate? Will it sustain itself in the face of a President Trump? Is it passed by the Canadian Parliament? Will it sustain itself with a Prime Minister Poilievre, whom Canada is likely to get? Is it on the statue book of the Federal German Republic? Will it survive a new Chancellor in Germany? Has it gone through the French Parliament? That Parliament appears unable to pass any legislation at all at the moment, let alone something like this.
I am unclear as to where we are, apart from the fact that we are passing the Act. What about the rest of the people on the list? What is actually happening? In the case of Italy, Italian support of Ukraine is not at a very high level at the moment. From what I know of Prime Minister Meloni, I wonder what her Government are doing? It would be good to know—not because I will vote against the Bill or try to stop it; it is a government Bill that seems to have the support of everybody in this House apart from me, so it will go through. But we need to know where we are with the Bill.
We also need to know pretty soon where we are with the new United States Administration because, let us face it, they will call the shots; we are not going to. This will be like Afghanistan—the US Administration will decide on a policy, we will be lucky to get a phone call and we certainly will not be able to carry on on our own. We need a European dimension to all this that looks at it from the interests of Europe. Those interests clearly involve the rebuilding of Ukraine but also involve coming to an arrangement with the Russian Federation that will stick. We seem to forget that we expelled Russia from the Council of Europe. “Great”, we said. We expelled 135 million Russians from the protection of the Court of Human Rights. We do not talk about that, though, do we?
We need a reset of our relations with the Russian Federation, with Ukraine and with the riparian countries of eastern Europe that rightly feel alarmed about Russia but also feel a little alarmed about the capacity and willingness of those of us further west to defend them. It is fine to say, “We have Article 5 of the NATO treaty”. I talked not so long ago to a Portuguese admiral —noble Lords will be surprised who I tend to know—who said, “Oh, yes, Article 5 says an attack on one is an attack on all”. It does not say what we have to do about it, though, does it? He said, “Do you honestly think that the people of Portugal would send troops to Ukraine? They would not”.
This is going to be difficult, but it has to be done. We need to think again about European security. We have spent too long behind an American blanket, expecting them to look after us. The fact of the matter is that 80 years after the end of the war, we have to start redesigning a Europe that works for Europe. We cannot continue to rely on the United States.
In building that new unity, we have to get closer to the European Union. I really am on my own on that—in this party, anyway. The European Union and the countries that are closer to us geographically in Europe are our future. I say to both parties that if neither of you can come to terms with Europe, you will lose the youth vote and it is not impossible that we will end up with that little Bench down at the end sitting on that Bench over there, and God knows who sitting on this Bench. Let us think our way through to a brighter future and stop repeating all the shibboleths of the past.
Baroness Goudie (Lab)
My Lords, I congratulate the noble Baroness, Lady Batters, on her speech today. I listened to her many times during Covid on the radio and television, and I was so thrilled to hear she was coming to this House. I look forward to working with her on food and other issues in the future.
This Bill is a welcome example of international co-operation. The additional financial assistance to Ukraine from the United Kingdom and other parts of the G7 is £38.6 billion of loans. These loans will be repaid from immobilised Russian assets held in the EU and will not be repaid by Ukraine. These assets will be divided between the G7 lenders in proportion to their contribution, £2.26 billion in the case of the United Kingdom. A crucial element is that the EU has adopted a regulation that will govern the repayment mechanism. This provides the legal basis within the EU for the UK to receive the repayment.
Like colleagues, I hope that throughout all this there will be no hold-ups, little glitches here and there or amendments. We have to make this happen now. This is an illustration of how vital it is for the UK and the EU to work closely together. This is crucial when the context is supporting Ukraine, helping it to resist and defeat the wicked, illegal and reckless Russian invasion and providing security for Europe as a whole.
The noble Baroness, Lady Wheatcroft, spoke about refugees in countries nearby. I have had calls from people in those countries, in Vilnius and even in Poland, who are worried about what the future holds for them and what the future could be for us and other countries. They are really worried. This Bill is an important aspect of the package of measures in a battle that has been well described as one of the defining issues of our age.
The World Health Organization has reported more than 2,000 attacks on health facilities, further straining Ukraine’s capacity to address mental and physical health needs. In 2024, 14.6 million people in Ukraine were estimated to need humanitarian assistance. This includes access to water, healthcare, shelter and psychological support. In the third quarter of 2024, the share of temporary protection decisions for children increased to 31%. As we know, children are now being taught in the underground during the day. They want to go to school to learn, but are frightened of what they might come back up to. The fighting and air strikes have caused more than 30,000 civilian casualties, including children.
The people of Ukraine are fighting for us all and our freedom. We are sending a message not only to Putin but to autocrats around the world that the international community will always oppose violence against national sovereignty.
Lord Kempsell (Con)
My Lords, I join in the expressions of welcome and praise for the noble Baroness, Lady Batters. I am sure that her excellent, touching maiden speech will have great resonance with working mothers everywhere. I know that the whole House looks forward to her contributions on the importance of British farming and so many other issues.
I welcome the measures in the Bill, which will continue to provide Ukraine with the financial support it so desperately needs. The funds in question are drawn from immobilised Russian sovereign assets, and rightly so. The extraordinary revenue acceleration mechanism is an innovative example of what is possible when the focus of our G7 partners is rightly directed at the aggressor. Russia unleashed this illegal war on the people of Ukraine, and Russia will have to pay. It is heartening that that sentiment has been nearly universally agreed to in your Lordships’ House this afternoon. As President Zelensky said, the measures we are debating are a strong signal that:
“Russia must pay for its brutal war”,
because
“accountability for acts of war is inevitable”.
I hope the Bill will be passed as swiftly as possible. I join others in thanking the Minister for his work on this, which I know has taken much of his engagement and focus.
On the payment timetable and the disbursement of funds, we understand that the G7 has agreed that payment will be in three equal tranches over the next three years. Given the urgency of the matter, and the many questions raised today in your Lordships’ House about the military use of the UK’s contribution to ERA, I ask the Government to consider submitting a speedier timescale than three years. That is what is needed. As we have heard so many times in your Lordships’ House, Ukraine urgently needs all the military equipment it can get, as soon as possible, so military use must be allowed.
To that end, I associate myself with the powerful and cogent arguments of my noble friends Lord Blencathra and Lord Banner about what has been left outside the scope of the Bill. I understand that the Government must seek to pass legislation as soon as they can in this area and the difficulties of designing legislation and drawing its scope, but we have heard here this afternoon some powerful arguments for widening the scope of this measure to the seizure and transfer of Russian sovereign assets in the United Kingdom.
Today’s proceedings raise a more significant issue than the technical details of the Bill. The Bill, though welcome, cannot be a substitute for the Government setting out a clear vision for the future of Ukraine and what they would like to see achieved in this crucial year. It is right that the UK’s financial, military and humanitarian support continues and has been maintained by the new Labour Administration. It is right that Ministers continue to visit Ukraine, although I note that, despite his busy and demanding travel schedule, the Prime Minister is yet to visit the country since he has been in office. I hope that he is able to visit very soon—I am sure he will. But none of that is the same as the Government setting out and articulating a vision for what should actually happen in 2025, because this is a critical moment for Ukraine and for the entire western alliance.
I know that Ministers will not want to risk the UK’s leadership or risk any accusation that the UK Government have turned down the volume on their leadership of big-picture vision for what should happen next. When I spoke in the debate on Ukraine in your Lordships’ House in October, I said I was concerned that the UK was at risk of losing that leadership. I said that because the same anxiety had been expressed in those direct terms by President Zelensky himself. Ministers must communicate to the public what this Government believe Ukraine’s destiny to really be. Ukraine is destined to be a free, sovereign, independent, European state in the western alliance. It is not destined to be part of a revanchist, reinvented Russian empire in any sense.
Ukraine’s future was arguably in contention for decades, but Russia’s illegal war has, ironically, settled the issue, because Ukrainians are now completely clear-eyed about what they want. I have heard it from Ukrainians themselves, including from servicemen injured on the front lines, as I made numerous trips to Ukraine last year. I say this in part to answer the questions posed by my noble friend Lord Balfe about what victory means. Ukrainians want to be inside the NATO security architecture. They want the capabilities and permissions to win the war, militarily, in no uncertain terms and for permanent western security guarantees to be in place. To anybody outside your Lordships’ House who might doubt that position, I suggest that they talk to Ukrainian armed forces service men and women themselves, because they possess the most up-to-date and expert experience available to NATO of fighting Russia.
As my noble friend Lady Neville-Rolfe said, when Russia invaded, former Prime Minister Boris Johnson was the leading voice when it came to giving Ukraine the military, financial and humanitarian support needed. But he also set out a vision. He understood that this is more than a kinetic war; it is a battle of ideas about how the world should be. I am worried that that language is slowly changing nowadays. Standing with Ukraine for as long as it takes and helping it pay for this war as long as it takes is, at face value, a laudable concept, but there are some inside the Russian Government who view that as sign of weakness because it suggests that there is an open-ended timetable for concluding this conflict.
I want to commend and thank the Government for supporting a series of Conservative Administrations while they were in office and for continuing that support for Ukraine on entering government. This Bill rightly develops that, so nothing should stand in its way or be done to slow down its passage. That said, I hope the Government will use this opportunity to set out what they believe to be their agenda to regain international leadership on how this conflict is settled. The UK should lead with moral and strategic clarity, because the denouement of this conflict is important to resolve in the best interests of the free world, including of course, and most pre-eminently, Ukraine.
Lord Purvis of Tweed (LD)
My Lords, it is a pleasure to follow the noble Lord with his very considered remarks, most which I agree with entirely. His points reflected the three words that I thought could sum up this debate—the need for urgency and clarity, and at scale. These are the priority areas where we would wish to see the Government continue to move. Notwithstanding, as my noble friend Lady Smith said, that we support the Government’s work on this entirely, those aspects, the next steps on how we are going to be moving at pace, will be of fundamental importance.
We are still technically debating the regret amendment from the noble Lord, Lord Blencathra. As a long-standing former Minister and Chief Whip, he knows that this is a Budget Bill and that he cannot amend it in this place, but, as anybody who has seen the speakers’ list will know, he also knows how to get the last word. I commend him for that, because these Benches agree with the thrust of his argument. If there is anything that we can do to help him persuade his noble friends on the Front Bench to support our positions on seizure, he can count on our support.
The debate also had the outstanding maiden speech by the noble Baroness, Lady Batters. My former constituency was on the north side of the border, so I used to deal with NFU Scotland rather than the NFU. I recall that at my first meeting with NFU Scotland as a brand-new Member of the Scottish Parliament, I thought that I had listened attentively, but it was rather complicated, with lots of very difficult, technical words. I jotted them down, but at the end, I went home and had to ring up the then president of NFU Scotland, who was the noble Baroness’s counterpart. I said, “I’m really sorry. I’ve looked at my notes and can’t now remember what the animal disease or the animal medicine is, because the words are so complicated”. He said, “Jeremy, you don’t need to understand what we say; you just need to understand that you do what we say”. With the clarity of the noble Baroness’s contribution, I hope that Ministers will do what she says in this House, and she is most welcome.
The sober element of this debate was the recognition that the toll on the Ukrainian economy and country has been enormous. We often try to get a picture of what the toll is on the Russian economy; sometimes we get information showing that there is a significant toll on it from our sanctions and from external actions. The news, which I think was from just last week, that one rouble is now worth less than one US cent is one illustration that a toll is being taken, but as my noble friend indicated, there is still too much sanction circumvention and there are still too many areas where the Russian economy is gaining—whether it is the shadow fleet, which we are still seeking to pursue, or other elements of avoiding sanctions. Constant work is of fundamental importance in this area.
I have previously raised something with regard to British Overseas Territories which I hope the Minister will be able to clarify. How are we ensuring that all the actions and all the work that we are doing are consistent across all parts, including the overseas territories?
With regard to the impact on Ukraine, it is now estimated that there has been well beyond £500 billion of war damage. That is just a modest estimate by the World Bank. It is inconceivable that Russia will voluntarily pay compensation, so any thought that if it retrieves assets, they will voluntarily be used for some form of reconstruction in a ceasefire agreement is for the birds. A fundamental question therefore needs to be asked: why would we not use the entirety of the assets for the reconstruction purposes which we know Russia will deny in the future? Given that Ukraine is suffering a budget deficit of well over £10 billion and that, in context, it allocates more than £40 billion—about half of its entire budget—to the defence sector, which shows the scale of what Ukraine is having to do, timing is of fundamental importance, as well as scale.
It is welcome, of course, that there is the G7 consensus on this, but it was agreed in June last year to use the profits on immobilised assets. It was in January last year, when we were in Grand Committee on the Russia (Sanctions) (EU Exit) (Amendment) (No. 4) Regulations, that I called on behalf of these Benches for the equivalent of what the Bill is now. The timing is of importance, but it is also not just about the cost of recovery and contributing to Ukraine now; it is also an argument about accountability.
Our friends in Canada have passed legislation. Given the other debates that we have secured, including in the other place on 6 January this year, as the noble Lord, Lord Browne, and my noble friend indicated, and given the points that my honourable friends in the Commons made in Committee of the whole House on the Bill, the argument is not simply about funding Ukraine’s efforts now for its economy and the war. It is also about ensuring that there is Russian accountability. If part of the argument is that the Putin regime should be held to account for what it is doing, why would it then be able to profit and, in effect, have assets back and be able to use them?
We probably know—the noble Lord, Lord Kempsell, perhaps alluded to this—that there is a distinct incentive for Putin to have some form of ceasefire: to pause, recoup and then string this on. There is therefore no long-term security, and if part of the funds are simply being immobilised so that the profits from them can be used rather than the asset value itself, then unfortunately there is an incentive for Putin not to have a long-term solution. I suspect that that is why there is a last-ditch attempt in the last days of the Biden Administration, as CNN reported yesterday, for them to move towards the seizure aspect. I hope that the Minister might have an opportunity to respond to that.
To help us understand the position—this is where clarity comes in—I hope that the Minister will be able to look kindly on what my honourable friend James MacCleary put forward as an amendment to the Bill. It was to seek government reports: an immediate report but also, for clarity, a report regarding our
“share of the principal loan amount”
and what is able to be seized, if we had the intent to do that. There are ways in which the Government could demonstrate more clarity—as the United States has done, having been asked by Congress, and as Canada has done—as to what the scale of the opportunity is.
Perhaps the Minister could clarify another question for me. How much of what has been committed so far under the G7 programme has been disbursed? My understanding is that, as reported, the US committed £20 billion as a portion to the World Bank in December but that only £1 billion has been disbursed. I wonder what the status is likely to be for when the disbursements will be in place, especially the UK contribution. If the intent of this fund is for the purchase of munitions on a very urgent military operation, it goes without saying that any delay to the disbursement is not to the advantage of our Ukrainian friends and allies.
Let me close by reiterating what my noble friend Lady Smith said at the outset. We believe that it should be the UK’s intent that we move on this, as far as seizure is concerned, and that it is unjustifiable that these assets should be utilisable by Russia in the future. Russia’s actions should not be forgiven by it being able to recoup assets which we have found justifiably should be frozen. Those assets should be seized at pace and at scale and be used for the defence of Ukraine and as part of its reconstruction. That would also show accountability for those terrible crimes that Russia has inflicted on Ukraine.
Lord Livermore (Lab)
My Lords, it is a privilege to respond to this Second Reading of the Financial Assistance to Ukraine Bill, and to the regret amendment tabled by the noble Lord, Lord Blencathra. I join others in congratulating the noble Baroness, Lady Batters, on her incredibly powerful maiden speech. She brings a wealth of experience to your Lordships’ House, particularly on agricultural and rural issues, and is widely respected for her stewardship of the National Farmers’ Union. We might not always agree, but I very much look forward to her further contributions in debates such as this.
I am grateful to all noble Lords for their contributions and for the unity the House has shown in supporting Ukraine. I am very grateful in particular to the noble Baronesses, Lady Neville-Rolfe and Lady Smith of Newnham, for their support for the Bill. Many noble Lords have spoken movingly about the ongoing plight of the Ukrainian people in the face of Russia’s illegal invasion. It is important that we keep them in our minds today as Ukraine endures a third winter at war. The consequences of Putin’s war are profound: thousands dead and wounded, families torn apart, and enormous damage wrought to Ukraine’s infrastructure and economy that will take many years to rebuild. Despite the carnage that the Russian war machine has wreaked, including scores of innocent civilians killed and thousands of communities devastated right across the front line, the spirit of the Ukrainian people endures, and their resolve to defeat Putin’s army remains undiminished.
In case it needs saying, I profoundly disagree with the contribution from the noble Lord, Lord Balfe. I am heartened by the fact that there has otherwise been near uniform support across your Lordships’ House. The Government’s position remains resolute: Putin must fail, and we must stand with Ukraine for however long it takes, including by working with our G7 allies as part of this scheme. The Government will continue to stand with Ukraine as it wages this fight for freedom. That is why, to date, the Government have provided £12.8 billion in combined military, humanitarian and economic support to Ukraine. The UK has also introduced the most wide-ranging sanctions regime ever imposed on a major economy, depriving Putin of vital finance for his war machine.
My noble friend Lord Beamish asked about circumvention of sanctions, which the noble Lord, Lord Purvis of Tweed, also mentioned. The Government are assessing and enhancing the UK’s sanctions enforcement. This includes working with international partners to build capacity and technical expertise within our own systems and to improve sanctions compliance in their private sectors, as well as deploying increased UK sanctions resources across our overseas network. This is a fight not only for Ukraine’s territorial integrity and the safety of its people but for the future of Europe’s collective security and prosperity. That is why the Prime Minister has committed to providing £3 billion annually to support Ukraine for as long as it takes.
Maintaining international pressure on Putin also requires working in close partnership with G7 allies. The Bill before your Lordships’ House does just that. It would unlock £2.26 billion of new funding for Ukraine, backed by profits generated from immobilised Russian assets as part of the G7’s extraordinary revenue acceleration loans to Ukraine scheme. The scheme demonstrates our shared commitment and solidarity in the face of Russian aggression and will provide approximately $50 billion of additional funding overall to Ukraine, taking account of the combined contributions of our G7 allies.
The noble Baroness, Lady Smith of Newnham, asked whether the Chancellor of the Exchequer raised Ukraine with her counterparts during her recent visit to China. In China last week the Chancellor was clear that, although we must co-operate in areas of mutual interest, we will confidently raise concerns where we disagree. She expressed her real economic and trade concerns with the Chinese, including on economic security. We have secured China’s commitment to improving existing channels so that we can openly discuss sensitive issues and our economy. If we do not engage with China, we cannot express our very real concerns.
The noble Lord, Lord Banner, suggested that we are not meeting or matching our words with actions, a sentiment echoed by the noble Baroness, Lady Wheatcroft. The UK has already provided £12.8 billion of military, humanitarian and economic support to Ukraine since the war began. We are committed to providing a further £3 billion of military aid each year for as long as it takes. This is a significant investment. The new spending the Government are committing as part of the G7 scheme is in addition to these existing commitments and is proportionate to our GDP share within the G7 and the EU.
The noble Baronesses, Lady Smith of Newnham and Lady Wheatcroft, and the noble Lords, Lord Banner, Lord Purvis of Tweed and Lord Kempsell, asked why the Government have not gone further by seizing Russian sovereign assets in the UK. This is also the focus of the regret amendment tabled by the noble Lord, Lord Blencathra. I fully understand that strong views exist on this issue, and I assure noble Lords that we will continue to actively consider all possible lawful avenues by which Russia can be made to meet its obligations to Ukraine under international law. I of course agree that Russia must pay for the damage it has caused in Ukraine. However, the Government believe that any action taken should only be in tandem with the G7. It is in this spirit of collaboration that we have agreed the extraordinary revenue acceleration loans to Ukraine scheme, and we continue to work closely with our G7 partners. Our focus now is on delivering this scheme rapidly to provide the immediate support that Ukraine requires.
The noble Baroness, Lady Anelay of St Johns, asked whether I am instinctively in favour of going further. I can only say that I am in favour of considering all legal routes. She also asked about those legal routes that we have taken. Due to Euroclear’s unique business model as an international central securities depository, it is able to generate extraordinary profits on the holdings of these assets, which legally accrue to Euroclear rather than to Russia. We do not believe the specific circumstances that provide profits generated in this way can be emulated in the UK as we do not believe that any UK-based financial institutions employ this business model. The UK is not required by the Ukraine loan co-operation mechanism to provide any extraordinary profits made from assets held in the UK; we are simply providing a financial contribution to that scheme.
The noble Baroness, Lady Neville-Rolfe, asked whether the UK’s contribution to this scheme will count towards the NATO target of spending 2.5% of GDP on defence. The UK’s contribution will be provided to the Government of Ukraine as a loan from the UK Government to spend on military procurement; it is not direct UK defence spending. The £2.26 billion loan will therefore not count as NATO-qualifying UK defence spending; it will be in addition to current NATO- qualifying UK defence spending. The noble Baroness also asked when the Government will meet this target, as did the noble Baroness, Lady Smith of Newnham. The Government have made a clear commitment to spend 2.5% of our GDP on defence, and this commitment has not changed. We will set out the pathway to 2.5% at a future fiscal event.
I will touch briefly on the nature of the UK’s contribution to this G7 scheme. The funding we are providing will be used for budgetary support earmarked for military procurement, bolstering Ukraine’s capacity for self-defence and providing vital equipment and support to the front line. As my noble friend Lord Beamish said, this funding is additional to the £3 billion of bilateral military support which the Government have committed to providing for as long as it takes. The Bill’s sole purpose is to provide the Government with the spending authority to deliver our contribution to this scheme, or any subsequent arrangements that supplement or modify it. It is not designed to facilitate any other spending on Ukraine or spending for any other purpose. The Bill enables the Government to sign the loan agreement with Ukraine and begin disbursing funds to it.
The noble Baroness, Lady Neville-Rolfe, asked specific questions about how disbursals from the fund will work—a point also raised by noble Lord, Lord Kempsell. The Government intend to begin disbursals early this year to ensure the funding supports our Ukrainian allies as soon as possible. We intend to disburse the UK’s £2.26 billion loan in three equal tranches over three financial years, starting in 2024-25. The G7 has agreed that all funds from this scheme will be disbursed by the end of 2027, although we plan to begin disbursals much sooner.
To further address the points raised by the noble Baroness, Lady Neville-Rolfe, this is a bilateral loan whose parties are His Majesty’s Treasury and the Ministry of Finance of Ukraine. The Government have begun talks with their Ukrainian allies to agree the terms of the provision of this funding. We do not intend for there to be geographical restrictions on where funds may be spent, and are instead ensuring that the purchase of much-needed vital military equipment is prioritised. There will be opportunities for the UK defence industry to benefit where this provides good value for money for the UK and for Ukraine. The Government are aware of the corruption risk in Ukraine and we are taking steps in our loan negotiations to mitigate it. I cannot comment on these negotiations in detail as they are still ongoing.
On the UK being repaid for this loan, as my noble friend Lady Goudie said, under the terms of the scheme the UK will be repaid by the extraordinary profits generated from immobilised Russian sovereign assets in the EU on a six-monthly basis as they accrue. The EU has already enacted the necessary regulation, known as the Ukraine loan co-operation mechanism, which will distribute the profits. This came into effect on 29 October 2024.
My noble friend Lord Browne of Ladyton spoke about international support for Ukraine, and the noble Baroness, Lady Neville-Rolfe, asked about the United States’s contribution to the scheme and the approach that will be taken by the incoming Administration. Although it would be wrong to speculate on any policy decisions that the incoming Administration may make, the UK Government have welcomed sustained bipartisan US support for Ukraine, which has been key in the international effort.
In answer to the noble Lords, Lord Balfe and Lord Purvis of Tweed, the US has already dispersed its $20 billion contribution to our financial intermediary fund at the World Bank. The EU has already passed and implemented its legislation, which covers all the European countries listed by the noble Lord, Lord Balfe.
Lord Purvis of Tweed (LD)
My point was less about the US providing $20 billion to the World Bank; my question related to how much Ukraine has actually received.
Lord Livermore (Lab)
I do not have that information to hand, but I will happily check for the noble Lord.
The noble Baroness, Lady Neville-Rolfe, asked whether the UK’s contribution to the scheme would increase if the United States or another participant chose to withdraw. I can confirm to noble Lords that this would not affect the UK’s contribution, which will remain at £2.26 billion. We are clear that that is the right and balanced approach, reflecting our fiscal pressures and Ukraine’s needs. The £2.26 billion figure is also proportionate to our GDP share within the G7 and the EU. We will of course continue to co-ordinate with G7 partners on the scheme going forward.
The noble Baroness, Lady Anelay of St Johns, asked for an update on the proceeds from the sale of Chelsea Football Club. The Government are working hard to ensure the proceeds from the sale reach humanitarian causes in Ukraine as quickly as possible. The proceeds are currently frozen in a UK bank account while a new independent foundation is established to manage and distribute the money. Creating an organisation of this scale is complex and officials continue to hold discussions with relevant parties to reach a resolution. As you would expect, we must review the details of any such arrangement to maintain the integrity of our sanctions regime.
In conclusion, we must ensure that Putin has no path to military victory in Ukraine. That means continuing to provide military and economic support to enable Ukraine to defeat Putin’s war machine. The combined $50 billion of new funding, delivered together with our allies in the G7 and backed by profits from immobilised Russian assets, will provide a crucial boost to Ukraine as it continues its third winter at war. It represents an investment not only in Ukraine’s future but in the security and prosperity of Europe more widely, and it demonstrates the shared resolve of the international community in the face of ongoing Russian aggression. I welcome the fact that noble Lords from all sides of the House have been united in saying that we must stand with Ukraine for as long as it takes. This Bill will allow us to honour that commitment.
Baroness Neville-Rolfe (Con)
Before the noble Lord sits down, there was one question about the announcement on the 2.5% of GDP. The noble Lord helpfully clarified that the money in this Bill was extra, which is good news, but I think several of us were concerned to know when decisions would be taken on the timing of the 2.5%.
Lord Livermore (Lab)
I answered that exact question from the noble Baroness. As we have said all along, we will set out a path to 2.5% at a future fiscal event.
Lord Blencathra (Con)
My Lords, I begin by congratulating the noble Baroness, Lady Batters, on a superb maiden speech, which impressed everyone in this House. I particularly liked her remarks on food and nature. British farmers can grow more food and we can also do nature recovery; the two are not mutually exclusive. I may be one of the few in the House who is not surprised at the noble Baroness’s powerful speech- making because, for the last six years, I was the deputy chairman of Natural England, and at times I felt that her powerful rhetoric was targeted against us as we sought to implement some of the ELM schemes. Nevertheless, she made a very powerful contribution to this House and she will be an excellent replacement for the late Henry Plumb in my opinion.
I am very grateful to all noble Lords who have supported, in various ways, the amendment I put before the House. In particular, there was powerful support from the noble Baroness, Lady Wheatcroft. I thank her and my noble friends Lord Banner and Lord Kempsell for their very strong support. I have now had to change my opinion on a matter. I always believed that no one under 50 could make any worthwhile contribution in this House, but the two noble young Turks behind me have proved me utterly wrong.
I am also grateful to those who gave some sympathetic support, including the noble Lord, Lord Beamish, and my noble friend Lady Anelay of St Johns. Please do not tell my noble friend Lord Forsyth of Drumlean, but I have to praise the two Lib Dem spokespersons who gave qualified support; they support the concept of what I was trying to do.
I must say to my noble friend Lord Balfe that of course, like many others, I profoundly disagree with what he said. But I admire and respect the fact that he said it in this House. While we may disagree with him, we respect his right to speak. It is something that other institutions outside this building could take note of—to let people speak their minds, even if we profoundly disagree with them.
I will pick up on just two points he made. First, he said that the Council of Europe, of which I was a member, expelled Russia. I voted for that to happen, but I was agonising about it. I like Churchill’s expression that jaw-jaw is better than war-war. I thought that maybe if we kept the Russians inside, we could communicate with them. But what they did in Ukraine was so evil that I voted to have them expelled. The noble Lord also made the point that by expelling Russia we deprived 135 million Russians of the right to go to the European Court of Human Rights. That is true, but a fat lot of good it did them when they did have the chance to go, because Russia never implemented any of the decisions of the court.
Secondly—I am coming to my conclusion—the noble Lord asked who was calling the shots. Well, it will be President Trump calling the shots on how much money the United States gives in military aid to Ukraine. He will call the shots on what non-military aid the US gives to Ukraine. But he will not be calling the shots on the immobilised Russian assets, because America has hardly any of them. Over 90% of those assets are held by the EU and United Kingdom. So, while he might dictate other measures, he cannot stop the EU and the United Kingdom taking this permissive power to spend that money.
I will not breach the conventions of the House by regurgitating the points I have made, but I just want to clarify one thing. My amendment is not calling for us to immediately confiscate those assets and start spending them in Ukraine. We cannot do that in any case because the Council of Europe—I think it is the Government’s policy as well—wants to see an independent fund. When the assets are confiscated, they will be transferred to that independent fund to then be given to Ukraine and spent on reconstruction.
We do not have that fund yet. My amendment is simply calling for us to take the permissive power so that, when the time comes, in conjunction with our allies—I am not asking us to confiscate that money tomorrow—we will not have to pass any new law; we will have the permissive power to use that money in the defence of Ukraine. That is the only point I wanted to stress and clarify. As I said at the beginning, I am not in the business of delaying this Bill any further. I beg leave to withdraw my amendment.
Football Governance Bill [HL]
Wednesday 15th January 2025
(3 days, 7 hours ago)
Lords ChamberRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Amendment Paper: HL Bill 41-VII Seventh marshalled list for Committee - (13 Jan 2025)
Lord Birt
Lord Birt (CB)
My Lords, I rise to move Amendment 295A and to speak to my other amendments, 297A through 297G. While I have, of course, had expert help in the drafting, the approach in these amendments is entirely my own. They are my response to discussions I have had within football and right across this House about the single most radical measure in the Bill: the process for determining fund flow down the football pyramid.
I have already made clear my conviction that the precious and unparalleled role that football clubs play in their communities justifies regulation. Fans should be listened to, and they deserve protection from the occasionally bad, if generally well-intentioned, stewardship of owners and management who take ill-considered risks and lose control of their finances—the overwhelming reason why clubs fail and falter.
I wholeheartedly welcome the provisions in the Bill for promoting good and prudent management. They should have a major and beneficial—indeed, radical—impact on English football. I believe, however, that the precise mechanism set out in the Bill for determining fund flow carries severe risk and could adversely impact the whole of the English game. I note the cogent reservations about the mechanism set out in the EFL’s own briefing paper from last November. I note, too, that the Bill’s progenitor, Dame Tracey Crouch, described the backstop mechanism as the “nuclear equivalent for football.” She observed, quite rightly, that in a nuclear conflict, he who pulls the trigger may not be the winner.
The backstop is an inappropriate measure to resolve issues between two groups who live cheek by jowl and whose membership is interchangeable every 12 months. Next year, any club might find itself sitting on the other side of the table. The essential task of establishing an appropriate flow of funds down the leagues is to balance two public goods, and “balance” is the key word: on the one hand, to maintain the extraordinary success of the Premier League; and on the other, to share sufficient of the fruits of the Premier League’s success to encourage the healthy operation of the whole of the football pyramid and to ensure that any well-managed club can rise to the very top.
Why is the Premier League the world’s most successful sporting league? It is because 40% of the world’s best footballers play in it—twice as many as in any other league. In its squad, Liverpool has nine players, from all over the globe, who captain their country. I mention only Egypt, the Netherlands, Scotland, Brazil and Japan. Premier League players are trained to extremely high levels of fitness. Their skills are honed and developed by the most expert professional support staff available anywhere. Game by game, they are schooled in ever more sophisticated tactics by the world’s best managers.
Ian Graham, the pioneering data scientist who had such a profound impact on the modern Liverpool football club, tells me that all the top Premier League teams are now far stronger than any national side anywhere in the world. So—and this is the absolutely critical point—week after week, fans and viewers all over the globe experience not just the best football in the world, but the best football the world has ever seen. That is the core reason why the Premier League attracts such high revenues and why we must do nothing to threaten that.
The second reason for the Premier League’s success is that English football is so competitive: 51 clubs have played in the league since its inception and only six clubs have survived the whole journey so far from 1992. It might surprise noble Lords to be reminded that Man City are not one of them. Three seasons ago, Nottingham Forest were in the Championship. This day, they are second in the Premier League, and the only team to beat Liverpool in the league this season—unfortunately, a game at which I was present. Eleven seasons ago, Luton were playing in the Conference Premier League. Over 10 years, they rose up through League Two, League One and the Championship to the Premier League. Most impressive of all, in 2008, Leicester were in League One. Eight years later, they won the Premier League, 10 points clear of Arsenal in second place. Plainly, therefore, the necessary balance of which I spoke has been struck: sufficient funds have been flowing down the football pyramid to enable well-managed clubs to prosper, and that must continue.
Currently, around £500 million each year flows down from the Premier League to the rest of the football pyramid, which is hardly parsimonious; but I entirely accept that a regulator must bring conceptual clarity and rigour to this critical arrangement. I have sympathy, for instance, with the EFL’s unease about the balance between parachute and solidarity payments. The current process set out in the Bill for setting the precise quantum of fund flow is, however, unlike anything I have experienced in a long and varied career. It would be divisive, and it could be destructive. It is likely to lead to both sides gaming, not to rational, evidenced negotiation aimed at achieving the necessary balance I have identified.
The core process set out in my amendment embraces the valuable concept in the Bill of a state-of-the-game report; requires the regulator to appoint a heavyweight, experienced commercial arbitrator; allows both leagues first to meet each other alone to discuss their response; and then proposes that the two sides convene under the chairmanship of the arbitrator to try to reach an agreement. If they fail to reach agreement, the arbitrator then determines the settlement according to the detailed and comprehensive criteria set out in these amendments —criteria notably absent from the Bill as it stands.
Keeping everyone in the room and talking is key. Arbitration is a proven process for crafting a solution that balances the interests of all sides, for a substantial and neutral person in the room encourages constructive dialogue and discourages posturing. Moreover, arbitration is likely to foster tailored solutions consistent with the complexity of football’s ecosystem.
Perhaps most importantly, unlike the nuclear and binary final-offer process proposed in the Bill, arbitration is widely used in commercial contexts where relationships are of critical importance. English football would surely benefit more from collaboration and dialogue than from conflict and division. Moreover—and this is no small matter—the criteria set out in these amendments are rooted in public law principles and neutral considerations of sporting competition, thus making it far less likely that the regulator’s decisions would be challenged in the courts.
I do not make these proposals lightly. I hope all sides of the House will see the benefits that this approach would bring. Above all, I hope the Minister will not reject this approach out of hand, but rather, agree to reflect on it and to consult with the key parties before we move to the next stage of this important Bill. I beg to move.
Baroness Evans of Bowes Park (Con)
My Lords, I have added my name to amendments in the next group that also propose changes to the resolution process, to which I will speak shortly. However, if the Minister is favourable to the proposed arbitration approach of the noble Lord, Lord Birt, as set out in these amendments— as opposed to those I have added my name to—and would be willing to accept and reflect further on the noble Lord’s proposal, I will be fully in support of that as I believe that his model is unquestionably preferable to that in the current legislation.
The intent behind the noble Lord’s approach is the same as mine—as he eloquently set out, to avoid the divisive approach currently contained in the Bill that could lead to both sides simply facing each other down, and instead to propose a mechanism that would ensure a tailored solution to the distribution of revenues that balances the interests of all sides and encourages constructive dialogue and collaboration to the benefit of the game and clubs at all levels.
As the noble Lord, Lord Birt, set out in his remarks, arbitration is a proven process; it is widely used in a range of commercial contexts and would lend itself effectively as a mechanism for helping to determine the revenues that flow through the football pyramid. In appointing an independent, experienced arbitrator to oversee the process and work with a set of detailed published principles, the regulator itself would remain one step removed, which the Minister has referred to in previous comments. I very much hope that she will look favourably on this well-considered and credible proposal.
Lord Addington (LD)
My Lords, the amendments in front of us seem very appealing on the face of it, but I wonder why we have not got there already. If the Minister has some idea about the process that led to the position that we have, which does not seem to have been universally popular, I would be grateful to hear it—and I think the Committee would benefit from that.
Lord Markham (Con)
I wish all noble Lords a happy new year, because this is the first time I have been here. I wish that my noble friend Lord Parkinson was joining us here instead of being in the Caribbean, from where he sends his best wishes. I really appreciate the time, effort and work that the noble Lord, Lord Birt, has put into this, although I am not sure about his statistic that 40% of the best players worldwide play in the Premier League. I would be interested in understanding where that statistic comes from, particularly as there seemed to be a Liverpool bias in that statistic.
The point behind all this, as the noble Lord said, is that a redistribution power gives unprecedented power to a regulator—unlike any other regulator in the country. As noble Lords have heard me say before, you do not see the FCA giving money from one bank to another or Ofwat giving from one water company to another. This has to be at odds with what the Sports Minister said just today—that they were looking to put in place a light-touch regulator. Instead, they are giving the regulator more powers than any other regulator in the country, which feels as if it is going in the opposite direction. The amendments in the second group seek to address that by suggesting that maybe we should not have those redistribution powers. But given a scenario in which we have those powers, the noble Lord has tried to set out a thorough and well thought-out process that is designed to foster compromise and avoid gaming. That is my concern about this.
I particularly appreciate the amendment on the criteria for settlement, which would make sure that there is a wider set of criteria in all this—looking to the competitive nature, audience appeal and continued investment. Without that, you are really just asking the expert panel to go back to the original objectives of the Bill, which are very simple and talk only about the financial resilience of the league, safeguarding heritage and financial soundness. There is a very easy way in which to achieve all those things, pointing the expert panel to saying that whichever suggestion gives the most money is going to achieve that, without having any other objectives. We could say, “Hang on a moment; going with the one that gives the most money does not at all take into account the appeal of the Premier League or the competitive nature of it all—it just makes sure that it is financially sound by giving it as much money as possible”. That cannot be right, but that is what we are setting up the regulator to do, if those are the only criteria and measures that it has to guide by. That is why I appreciate the wider set of measures set out in the amendment, which is very much a guide to how to do that, similar to the amendments tabled by my noble friend Lord Parkinson, which are in my name as well, on having a financial investment duty on the regulator in deciding any final proposal.
I also support Amendment 297F, which is about putting in place a proper appeals process. It is about getting as sensible, thorough and transparent a process as possible, and I look forward to hearing from the Minister how the Government would look to take on board these sensible provisions.
Lord Moynihan (Con)
Before the Minister responds, I thank the noble Lord, Lord Birt, who sat through many hours of Committee and held his council until this moment, when he has made some very forceful and powerful points geared specifically towards having a co-operative, thoughtful and collaborative response to mediation. The legislation at present is not like that; it is divisive and nuclear, to use two of the words that the noble Lord used. This is one area where there can be agreement across the Committee, and I hope that there will be agreement from the Minister that we can return on Report to look at this, so that we can be more in line with other regulatory mechanisms for mediation. None is as divisive and polarised as the one in the Bill, and I very much hope that the support will be universal for the noble Lord, Lord Birt. I am grateful to him for the thought that he has given to this.
Baroness Taylor of Bolton (Lab)
Will the noble Lord acknowledge that you can have mediation only if both sides are willing to participate? What we have seen from the Premier League in recent years is that it is not willing to do that.
Lord Moynihan (Con)
I disagree with the noble Baroness on that. Through the history of the backstop powers and the parachute payments, this has been subject to consistent and constructive negotiations. Some negotiations are tougher than others; there is no doubt that in recent months and the last couple of years there have been examples of both sides failing to reach an agreement. I do not believe that putting this regulatory pressure into a binary system is going to resolve that. Yes, negotiations are tough and are frequently going to lead to detailed iterations before a satisfactory position is reached—but the last round of negotiations in particular was very close to reaching an agreement. I do not believe that the imposition of regulatory pressure is going to resolve that beneficially for the future of the Premier League, or indeed the EFL, at all.
Lord Bassam of Brighton (Lab)
My Lords, before the noble Lord completely finishes his point and before we get to the Minister, from whom I think we all want to hear on this, does he accept that there has not been any progress in negotiations for 18 months? That is a very long time. The Premier League has to come somewhere close to where the EFL is if there is to be some sort of progress, and there has been no progress in that time—so I am not sure that the noble Lord is right.
Lord Moynihan (Con)
I am equally keen to sit down so that we can hear the Minister respond. I was party to the letter from the EFL and to the reply from the noble Baroness, who set out clearly the steps taken during these negotiations, and it is simply not true to say that over the past 12 months no progress has been made. I hope that the noble Lord will agree that the proposal made by the noble Lord, Lord Birt, is a far more efficient, professional and collaborative way in which to make progress, and I very much hope that the Minister will echo that in her response.
Lord Pannick (CB)
My Lords, my response to the noble Baroness, Lady Taylor, is that the experience in litigation over recent years is that a requirement on parties to acrimonious disputes to mediate does often ensure a consensual settlement of disputes that seemed unable to be resolved—the formal process of mitigation. I declare, as I always do, my interests as counsel to Manchester City in disciplinary proceedings. I am a season ticket holder at Arsenal. I am interested to hear that the noble Lord, Lord Parkinson, is in the Caribbean; I had intended to go to the Emirates Stadium tonight to see Arsenal play Tottenham Hotspur, but I decided, on the basis of their recent form, that it would be far more entertaining to listen to the noble Lord, Lord Birt, and other noble Lords.
I just make two points about the amendments from the noble Lord, Lord Birt. I agree that they deserve close attention and I look forward to hearing from the Minister. The first is on Amendment 297A, on the appointment of a mediator. The noble Lord proposes that the person to be appointed must have held high judicial office. I say to him that, based on my experience, the best mediators are not necessarily those who have been judges. A mediator is not deciding anything; a mediator needs empathy and the ability to build a relationship of trust with the warring parties. I therefore respectfully suggest to the noble Lord that he may want to think about that point.
The second point that I raise with the noble Lord and the Committee is on his Amendment 297F. If I have understood his scheme correctly, there is a mediation stage, then there is an arbitration stage and then the ability for either party who is dissatisfied with the arbitration to take the matter to the Competition Appeal Tribunal. I point out to noble Lords that it is customary, where there is arbitration, that the power to take a matter that has been consensually arbitrated to a court or tribunal is very limited. That is the whole point of arbitration; it is to reduce the possibilities of further lengthy and expensive proceedings. The Arbitration Act, in most circumstances, limits the ability to go to court or to another tribunal thereafter to very specific and limited grounds. Again, the noble Lord may want to give thought to that.
Lord Hayward (Con)
My Lords, during the Second Reading debate, I made a contribution in relation to this specific issue and I disagreed with some of my colleagues. I indicated that I had worked for many years as a negotiator on behalf of management, on behalf of some of the largest corporations in this country. I negotiated with trade unions. It is easy to talk about mediation, arbitration and swing arbitration, which is in fact what is proposed in this Bill by the Government, but they all tackle an issue in different ways.
I am impressed by the arguments from the noble Lord, Lord Birt. I said at Second Reading that I was not averse to the proposal, but I wanted to see what the alternatives were. I will listen to the Minister with care, because I think it is important that one addresses the different forms of mediation and arbitration that are available to two sides, whether they are, in my case, management and trade unions, whether they are industrial organisations or whether, in this case, they are particular bodies that have an interest in coming to an agreement.
That is my observation, but I put one specific question to the Minister. According to press reports, the Chancellor is meeting regulators tomorrow to emphasise to them that they should prioritise growth. Given that so much of our debate has been about maintaining the growth of the football industry while tackling issues, I just seek clarification as to whether the shadow regulator has been invited to that meeting with the Chancellor. If so, is he going?
Baroness Brady (Con)
My Lords, I refer the Committee to my interests as declared on the register. I want to address a comment made by the noble Baroness. The assertion that the Premier League has made no substantial proposals during negotiations is not true and not borne out by the facts. The Premier League has put forward multiple comprehensive proposals alongside detailed financial models and heads of terms, which were also provided to DCMS. Each was designed to significantly increase solidarity contributions while ensuring financial controls that the additional funding encouraged sustainability and not wage inflation.
I am informed that the EFL did not keep its clubs fully apprised of the proposals made by the Premier League, nor did the EFL at any stage recommend the Premier League’s proposals to its member clubs or recommend to its board that they may be accepted. So there has been progress, and offers have been made by the Premier League that have not been put by the EFL. It is categorically wrong to suggest that any delay is wholly or in part because of the Premier League.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
My Lords, I thank noble Lords who are here for this debate, especially those who have missed football matches to take part in a game for the greater good of football—that is something we all agree on, whether or not we agree with the exact form of the regulator or whether we have amendments on which noble Lords may have a different view from me and the Government.
Before I address the amendments in this group, I would like to make a brief clarification regarding a comment that I made in Committee on 18 December. It pertains to an issue that comes up in the next group, but I felt it important to clarify it at this point of the debate. In response to a question from the noble Baroness, Lady Brady, regarding whether there was a similar final offer mechanism in use in the UK and how it has delivered the outcomes that this model intends to achieve, I said that the Competition and Markets Authority had used a final offer mechanism. While the CMA does have a similar final offer mechanism, it was incorrect for me to say the process had been used, as the Digital Markets, Competition and Consumers Act only received Royal Assent on 24 May 2024, so the new regime has only just come into effect and has not yet been used by the CMA to come to a determination. We are clear, however, as the previous Government were clear, that this is an evidence-based model developed in tandem with leading economists, which has successfully achieved intended outcomes in other jurisdictions. I hope that through this evening’s debate I can reassure noble Lords that this is also the correct model for use in this case. As I mentioned, the model is discussed in considerable depth in the next group.
I note the question from the noble Lord, Lord Hayward, and I will seek clarity before the end of the debate. If I do not get it, I will come back to him on that particular point. Like him, I noted the request from the Chancellor on that point.
Moving on to the specific group that we have just debated, I thank the noble Lord, Lord Birt, for his amendments and insightful contributions. I also welcome his broad support for the principle underpinning the Bill around the independent football regulator. His knowledge and expertise are hugely beneficial in supporting the House to scrutinise this legislation. It was also helpful to have a reminder of the movement and the fluidity within and between leagues. That is an important point for your Lordships’ House to note and remember. The noble Lord, Lord Birt, has played an important part in the development of football broadcasting in this country and, as we have heard today, has a number of really valuable thoughts around this issue. That is also apparent in the thorough scrutiny that the noble Lord’s amendments provide on the design of the backstop process. It is important for us to examine why the Government believe that the backstop process remains the model that we should rely on when we come to setting the independent football regulator to work.
To reflect on the concerns of the noble Lords, Lord Birt and Lord Markham, and the noble Baroness, Lady Evans of Bowes Park, among others, I first restate that the intent behind this mechanism is not to create a heavy-handed regulatory intervention. There is a mediation process built in and we agree with the noble Lord, Lord Pannick, that this is an important step. To respond to the noble Lord’s specific concerns, the intent is to provide a last-resort process, only to be triggered if the leagues cannot come to an agreement themselves. It is genuinely intended to be a backstop. It cannot take place until mediation has concluded.
A number of noble Lords questioned why government intervention in this space is even necessary. A clear distribution agreement is in the interest of both the public and of football. Indeed, the Premier League recognises that financial redistribution is needed to ensure the vibrancy and sustainability of the football pyramid. As the noble Baroness, Lady Brady, has outlined on a number of occasions during Committee, that is why it already voluntarily distributes its revenues to lower leagues.
The EFL and the National League are important talent pipelines to the Premier League. Similarly, the Premier League is an important financial supporter of various programmes across the lower leagues. The football pyramid is a mutually beneficial structure, but only when a suitable distribution agreement or order is in place. The mechanism would not be necessary if the industry were able to come to a new agreement. I want to reassure noble Lords that, should the leagues choose to come to an independent agreement without the backstop, the regulator will not need to get involved and will not do so. One of the leagues has to apply to trigger the regulator’s process. It has to meet a high threshold, so leagues cannot unilaterally trigger it. This is not regulatory overreach into corporate agreements. If a voluntary corporate agreement is made between the leagues, then there is no role for the regulator. It is an alternative route by which a suitable deal and distribution scheme can be put in place, should the leagues require it. We recognise the value of preserving the competitiveness of English football. This process is designed to ensure its long-term financial sustainability and not to force a regulator-designed agreement on an industry.
Taking the points made by the noble Lord, Lord Birt, sequentially, I want first to address Amendments 295A and 297A. We acknowledge and respect the amendments’ intent to ensure that the mediator has the appropriate legal expertise to mediate successfully a complex financial and legal agreement alongside preventing potential conflicts of interest. I am not going to repeat the points made by the noble Lord, Lord Pannick. I agree with the sentiment expressed by the noble Lord, Lord Birt, that the mediator should be a relevantly qualified individual. However, we think that adding these specific requirements would disqualify potentially qualified and appropriate candidates and limit both the leagues and the regulator in their selection of potential mediators. As drafted, these principles for hiring may be too prescriptive and could lead to an inability to appoint a mediator if no suitable candidate were found who met all the conditions.
Amendment 297B seeks to add a formal arbitration mechanism to the backstop by providing another forum for negotiation before a final decision is made by the regulator. I must reiterate the point that the leagues have not been able to agree a new deal under an existing agreement since 2019. The addition of another negotiation step after the mediation stage would require not only the hiring of another formally qualified arbitrator but the introduction of a new set of statutory timelines. These new timelines, by which various crucial decisions must be made, would make the backstop process functionally unusable from a timing and resources perspective. It is also unclear what formal arbitration would be likely to achieve after a mandated and guided mediation process. The leagues can already come to an alternative agreement at any stage in the backstop process. This ability is explicitly protected in the Bill, so this added arbitration step would add complexity and would potentially—or even likely—delay the process.
On Amendments 297C and 297D, the introduction of a determination process would fundamentally override the final offer stage of the existing process, representing a significant shift in government policy towards a different type of arbitration process and moving away from the final offer mechanism. The process outlined in the amendment would offer the arbitrator greatly increased discretion regarding the design of the final proposals, requiring them only to consider evidence presented by the parties rather than to accept the design of one of their proposals. While we are sympathetic to the desire for the regulator to be required formally to consider expert analysis, systemic implications and the practicality of the proposals, allowing a third party to propose their own form of determination would remove entirely the incentive which the original process is designed to create. With a third-party decision-maker introduced to the process, it is likely that competition organisers would simply dig in to an inherently adversarial position rather than move closer to a middle ground and allow the third party—the arbitrator—to decide for them. It is our view that this amendment would increase reliance on the regulator and move us further from an industry-led solution.
Amendment 297E seeks to ask the regulator to provide more detailed information about the implementation of their decisions. This would include outlining transitional arrangements and compliance requirements, alongside outlining when orders can take effect. Again, I am sympathetic to the sentiments expressed by the noble Lord, as minimising adverse unintended impacts on business should be a top priority for the regulator when implementing a decision. The Bill requires distribution orders to include a summary of the questions for resolution, a copy of the final order, information detailing the reasons for those decisions and information on potential consequences of non-compliance. We would also expect the regulator to stay in constant communication with the leagues throughout the implementation process.
Amendment 297F would add to the ability of the leagues to appeal decisions made as part of the backstop process to the Competition Appeal Tribunal. Regulatory decisions made as part of the backstop process are already considered “reviewable decisions” open to appeal under the existing appeals process outlined in Part 9 of the Bill. Functionally, therefore, this amendment only makes more explicit a process that could already be triggered under existing clauses.
Finally, I turn to Amendment 297G, which would require the regulator to publish guidance on their decision-making and implementation processes and for them to keep this guidance under review for potential update in future. While we are not opposed in principle to the idea of regulatory guidance and the backstop, there is already provision in the Bill for guidance to be prepared by the regulator at their discretion and in consultation with such persons as they consider appropriate. In addition, the amendment would lock the appointment of a mediator behind the publishing of the guidance. In practical terms, this would significantly affect the timeliness of the process and open a window of opportunity for the process to be stalled by the leagues via extended consultation. We are keen for the leagues’ views on the process to be heard and taken into account by the regulator, but we are also conscious that football has already gone quite long enough without a suitable new arrangement. To reiterate, a timely, satisfactory agreement is in the public interest, as it is vital to the continued sustainability of the game. I repeat that I am always happy to engage with any noble Lords and other stakeholders on this point and to go through how the process might work, as I have already done with the Bill team. For the reasons I have outlined, I must reject the amendments from the noble Lord in this instance and ask him not to press them.
Lord Birt (CB)
I am genuinely grateful to the Minister for her long, detailed and considered response. It gives me hope as I hope it gives hope to other noble Lords across the Committee. In going into the detail, the Minster registered how complex these issues are. This must be capable of being improved. Some of the doubts that exist on all sides of the Committee should be further considered to be sure that all these considerations are truly reflected at the next stage of the Bill when we come back to this matter, as we definitely will.
I am also very grateful for the broad support for this approach from right across the Committee, including from the noble Baroness, Lady Evans of Bowes Park, and the noble Lord, Lord Markham. I did not divine the 40% figure myself—as noble Lords know, there are a lot of data scientists operating in football. I am sure that it is highly arguable, but, intuitively, it rings true for me, not least because the Premier League has far greater resources than any other league, so it would be surprising if that did not result in it having by far the highest proportion of the world’s best players. If there is one key performance measure here about the appeal of British football, it is that we have the best players in the world playing in it. That is something we cannot forget. We cannot afford to reduce that percentage, whatever it is.
I am particularly grateful to the noble Lord, Lord Moynihan, who has made many excellent contributions to the Bill. Above all, I am very pleased that the noble Lord, Lord Addington, retains an open mind about the possibility of improving this important part of the Bill. I ask the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Bassam, to please read the amendment as written, because it is designed to avoid the very situation that they stood up to complain about. It is designed to bring mediation, collaboration and consideration, and, at the end of the day, binding arbitration. It has everybody in the room. It has not worked these last couple of years because the right people have not been in the room in the right circumstances. I want a resolution in the interest of the whole of football and I firmly believe that the approach set out in my amendment is far more likely to deliver it than the potentially divisive process in the Bill as it stands.
Lord Markham (Con)
My Lords, I rise to oppose the proposition that Clauses 61 to 64 should stand part of the Bill and I am grateful for the support of the noble Lord, Lord Birt. I will also speak to my Amendment 310, which is also in the name of my noble friend Lord Parkinson, who unfortunately cannot be with us today. I appreciate that there is quite a bit of overlap here with the debate we have just had, so I will try to keep this concise.
For me, the main thing about all of this is, what are we trying to solve here? We all agree that we have a very successful league—the most successful in the world. I love the statistic that 40% of the best players play in it. I would say that even more of the best managers are there when you look at it.
I looked up the solidarity payments and compared the 14% that the Premier League pays with the UEFA figure—in terms of the solidarity payments it pays to clubs not in the European competition but in the leagues —which is 5%. So we have a situation whereby the Premier League is paying almost three times the amount, creating a very successful situation. Of course, a lot of the reason for that is because it realises there is a great degree of fluidity, as per the statistic that the noble Lord, Lord Birt, mentioned earlier and which I have mentioned previously. The fluidity means that over 50% of the 92 clubs at some stage have been in the Premier League, and by definition have fallen out again. So, it is in all of their interests to make sure that the whole structure of football is successful. The fact that the Premier League pays 14% in solidarity payments, far more than UEFA and other leagues, shows all of that.
The statement has been made that we need to step in here as a regulator because there has not been agreement for years. As soon as it was known that a regulator was going to come on to the pitch, so to speak, it is not surprising that you do not get an agreement at that point. If I was the English football league in that, it would be entirely logical to think, “Hang on a moment, if a regulator comes in with powers in this space, that is going to give me more leverage” So, clearly, under that circumstance, it is rational for me to hang on because I am likely to get a better deal under that situation. I cannot get a worse deal than the one the Premier League has already suggested, so why not hang on for the regulator to come into the picture? So, to my mind, it is not surprising that we have not had an agreement as a result. It is actually because of the offer of the regulator that this has not happened.
So my main question about all of this is, what are we trying to solve here? It is not clear to me that there is a problem. In fact, I would suggest the opposite. I do not believe that this is the time to give unprecedented powers to a regulator which no other regulator in the country has, as I mentioned before. The regulator’s only criteria are to promote the financial soundness, financial resilience and heritage of English football. There is nothing else: nothing to do with its success, its audience appeal or the rights money it gets in, just those very narrow objectives. To fulfil those, it is always going to look to the mechanism which redistributes the most amount of money, because those are the narrow criteria it has been given. So I believe that that really gives us a danger of setting in motion a set of unintended consequences.
Given that I accept that there is a small chance those points will not be agreed by the Minister, I will move on to the other amendments we have added. My Amendment 310 states that, when making a determination under Clause 62, to which a final proposal to accept is made, the expert panel must have due regard for Section 7(2), which establishes the negative outcomes that the regulator must take all efforts to avoid. I must say that in all of this I actually prefer the amendments made by the noble Lord, Lord Birt, to any of these following ones that we put down. I am mentioning them in terms of completeness, but my first choice is that the regulator does not have the powers to redistribute at all. If it does, my second choice is that it adopts an approach similar to the one set out by the noble Lord, Lord Birt, which is a very well thought through process. I will speak to all of my amendments with that context in mind.
As I said, Amendment 310 tries to make sure that the expert panel takes into account the unintended consequences set out in Section 7(2), making sure that the expert panel has a duty to consider the impact on the leagues and on the competitiveness of English football, which is what makes it exciting and the best in the world.
I also support Amendment 304 in the name of my noble friend Lady Brady, which deals with precisely the issues that have been identified: the binary nature of the final proposals process. My noble friend’s amendment is simple and very reasonable. It permits the committee of the expert panel to include elements of both final proposals when making a distribution order. This will prevent the regulator simply choosing one proposal and ignoring the other, thereby achieving a real compromise while at the same time ensuring that the regulator is not imposing its will on the competition organisers. Amendment 304 seeks to strike a balance and better meets the aims set out in the Minister’s letter of incentivising compromise. I urge the Government to support these amendments.
Lord Watson of Invergowrie (Lab)
My Lords, I had not intended to speak to this group of amendments, but the noble Lord, Lord Markham, has prompted me to do so. He said just now that he does not think the Bill or a regulator are necessary because his aim is— I am quoting him; I hope he thinks I am doing so accurately—“to make sure that the whole structure of football is”, and remains, “successful”.
Lord Markham (Con)
Noble Lords will remember that, in earlier debates, I said that there are many good things that the regulator should be set up to do, so I agree with that. The MK Dons is a very good example. The “fit and proper persons” test and the breakaway league are both very positive reasons to have it. An earlier proposal was that every club should have two non-executive independent directors, which, from memory —I cannot quite remember—had widespread support. All those sorts of things are good; it is the financial redistribution of the moneys that I believe is a step too far.
Lord Watson of Invergowrie (Lab)
I thank the noble Lord for that, but I do not thank him for mentioning MK Dons, which, as a supporter of AFC Wimbledon, strikes a bit of a raw nerve with me. But I understand the point he was making.
I come back to the noble Lord’s argument about making sure that the whole structure is “successful”—yes, I want that. As a supporter of a club in League Two, I want to make sure that more of the money available in the game filters downwards. I do not even want it to be contained within the Championship; I believe that the Championship has a disproportionate amount of the revenues that come from the Premier League.
I do not believe in parachute payments. All the money, including the parachute payments, should be spread throughout the three divisions below the Premier League—I have argued that before in your Lordships’ Committee in earlier debates. We are told that clubs are disincentivised to get promoted to the Premier League if they cannot have some guarantee. But, from memory, I can think of some clubs who are in the Premier League for the first time and have established themselves after several years—Brentford and Brighton are obvious examples—without having parachute payments to get there. Bournemouth have been in for some time; although they dropped out for a season, they came back again. For this season, somebody mentioned Nottingham Forest, who are second place; they have been in the Premier League for 25 years or so. Ipswich have made it after a similar gap.
I do not think that the parachute payments are anywhere near as essential as has been suggested. However, the money used for parachute payments, if it is spread more equitably, particularly down to League One and League Two to a greater degree, would enable the structure of English football to be successful in the way that the noble Lord, Lord Markham, suggested.
Lord Markham (Con)
The noble Lord, Lord Watson, referred to Brighton and Brentford. I have spoken to the chair of Brentford and the CEO of Brighton. Both say that without the parachute payments—that safety net—they would never have invested in the players when they got promoted. If they were relegated without the parachute payments, they would have faced real financial difficulty. So it was the safety net of the parachute payments that gave them the confidence to invest in players, which then allowed them to have a strong enough team to stay up. I think that they would argue—in fact, they have argued this; it was in the letter that I circulated from the Brentford chairman—that the parachute payments were fundamental to their success in the Premier League.
Lord Pannick (CB)
My Lords, I cannot support the noble Lord, Lord Markham, on this. We undoubtedly have a very successful Premier League. Two questions arise from that. The first is whether the Premier League clubs have an obligation to provide some of their financial riches to clubs lower down the pyramid. It seems to me that the answer to that is undoubtedly yes. Those clubs, some of which are in a perilous financial state, are vital to their communities, and the pyramid is vital to the success of the Premier League, so they do have an obligation. The noble Lord, Lord Markham, said, very helpfully, that he agrees.
If that is right, the second question is whether the amount of money that the Premier League should provide downwards should be determined exclusively by the 20 clubs of the Premier League. The answer to that, in my view, must be no, of course not. There must be an independent, qualified person who assesses how much is appropriate, in all the circumstances, for the Premier League to provide downwards.
Baroness Brady (Con)
My Lords, I will speak to Amendments 302, 303 and 304 in my name, which would deliver two improvements to the backstop mechanism: a funder preference model and the ability for the regulatory panel to select elements of both parties’ proposals. These changes are intended not only to mitigate the extreme risks inherent in the current model but to enable a balanced, effective and generous approach to Premier League funding for the football pyramid.
I reiterate that Premier League clubs, and the league itself, are not opposed to regulation per se, and there are versions of the Bill, and indeed the backstop, that could be made to work. I say that notwithstanding the fact that the Premier League already shares its revenues more generously than any other major football league. The current voluntary approach to the distribution of our revenues has helped make the Championship the sixth richest league in Europe. The Premier League and its clubs are not afraid of doing the right thing. I believe that we would back ourselves to be fair, generous and innovative in addressing the needs of the pyramid. While we may not like it and believe it to be unnecessary, we are not remotely frightened of a regulator that is empowered to determine the right answer.
However, that is not what the Bill enables. The reality is that this untested idea is just not the right way to achieve the Government’s aims. As drafted, this backstop poses intolerable risks to the Premier League, its clubs and the wider football ecosystem. At its core, the backstop represents an unprecedented and untested intervention in what has historically been a voluntary and collaborative arrangement for revenue distribution. Far from coming up with the right answer, the pendulum arbitration model forces the IFR to choose one proposal in its entirety: either the Premier League’s or the EFL’s. This binary approach is not only crude but inherently adversarial. It incentivises extreme and divergent proposals, turning negotiations into high-stakes brinkmanship.
It is important to remember that this model does not simply decide funding levels; it also governs critical aspects of the football pyramid’s structure, such as merit rakes, the conditions of funding and even the existence or form of parachute payments, which we will return to in the next group. As I said in Committee before Christmas, this mechanism therefore periodically throws all the pieces of the pyramid into the air, with enormous uncertainty as to where they might land.
The inclusion of parachute payments in the backstop has only amplified these risks. We know that abolition or near abolition is not a hypothetical risk, because it is the clear position of the EFL. Make no mistake: its vision would fundamentally level down the Premier League, stripping smaller clubs of the tools they need to survive and thrive, and replacing aspiration with survival as the ceiling of ambition. This is why a proposal for a funder preference model warrants serious consideration.
My amendment would require the regulator to select the Premier League’s proposal so long as it meets all the regulatory objectives: in other words, so long as it delivers, in full, against the issues identified by the regulator. A funder preference model does not mean that the Premier League gets its way; it simply means that, as the sole funder—the people whose property rights are being interfered with—its proposal for meeting the sustainability needs of the pyramid would be given preference if, and only if, it delivers all the regulator’s objectives.
This approach would mitigate the risk of an extreme proposal being selected but only if the Premier League continues to step up to the plate. Importantly for the Government and the industry, it would also reduce the likelihood of prolonged legal challenges. Crucially, with parachute payments now included in the Bill, a funder preference model could still oblige the Premier League to adopt the parachute system if the “state of the game” report identifies challenges, but it would do so without the intolerable risk of the near abolition or the destabilising consequences that would follow. In other words, it would enable a balanced calibration of the parachutes rather than creating threats to them.
Also important is my amendment to give the panel the ability to combine elements from both proposals, rather than necessarily be obliged to choose one proposal or the other in its entirety. The noble Lord, Lord Birt, compellingly demonstrated the case for a more sophisticated approach, alongside proper principles and criteria to guide the panel in its decision-making. My amendment is different in that the IFR would be far less involved in designing a solution itself but it would also allow for more tailored solutions that address the needs of both parties. This seems far preferable to forcing the regulator into a binary choice.
The Premier League and its clubs’ track record demonstrate that it already has incentives to balance its own needs with the needs of a thriving, well-funded pyramid. The Premier League is not perfect but it has consistently stepped up to find the right answer for the whole game to the tune of £1.6 billion of funding over three years. We invented solidarity payments; no one forced us to. We created a stadium infrastructure fund that has helped over 1,000 community clubs. No one made us do it. We designed community programmes that have reached over 2 million young people. No one mandated it. We said that we would stand behind the pyramid and not let any club go to the wall during Covid. None did, because we stepped up to the plate and gave funding to the clubs that needed it. No one made us do that either.
We recognise our responsibility as a leader and steward of our national game. From that vantage point of stewardship, it is obvious that the backstop as currently designed is not the right answer for English football. It seems obvious to noble Lords right across this Committee too. As has been pointed out, not even the EFL likes this crude model. The unfortunate reality is that this particular backstop model seems to have no support—zero. We therefore need to change course. The Government should reconsider, especially as UEFA has asked them to, and work with football to come up with a much better and a far less risky solution for the whole game.
Lord Bassam of Brighton (Lab)
My Lords, I will speak to Amendments 308, 309 and 318. Before I say something critical about the comments made by the noble Baroness, Lady Brady, I would love to congratulate her on securing the services of Graham Potter—a good example of how Brighton & Hove’s generosity of spirit has extended down the Premier League. I hope that West Ham can build on our measure of bringing on talent.
The heart of our amendments in this group is Amendment 309, which seeks to qualify the way the regulator performs in this regard. Essentially, it would ensure that the financial gaps between the divisions in the pyramid are closed. It seeks to ensure that there is adequate compensation for player development and academies, and to provide for the welfare of players. It seeks to incentivise clubs to be well run and provide training for volunteers. The fifth element of the amendment is that the independent football regulator should address issues identified by the relevant “state of the game” report.
We do not set out a formula in our amendments but we say that the financial gap between the leagues needs to be addressed. Of course, in doing so, the football regulator will have to have regard to its “state of the game” report. The noble Baroness, Lady Brady, has made much play on several occasions of the generosity of the Premier League. There is no doubt that the Premier League is generous, but when one looks more closely at the figures and statistics, there is a limit to that generosity. Currently, the distribution of money coming from the Premier League is that some 92% of the revenue that it generates goes back to the 20 Premier League clubs, plus the five that are beneficiaries of parachute payments. Therefore, 92% goes to 25 clubs. That seems somewhat excessive. It means that just 8% of the distributable revenues from the English game, which amount to some £3 billion, goes to the other 67 professional clubs, which receive just £245 million. That gap has grown over the years. That is why we think it is right that the independent football regulator should give that gap some careful scrutiny.
The then Conservative Government commented in their White Paper that the parachute payment system
“can distort competition in the Championship and encourage greater financial risk taking by clubs that are not in receipt of them”.
That was a big and bold statement. It is worth reflecting on some of the research that has been done on the impact of parachute payments. Back in 2017, Dr Rob Wilson from Sheffield Hallam University, looking at that period between 2006-07 and 2016-17, concluded that clubs receiving parachute payment were
“twice as likely to be promoted to the English Premier League”
and “considerably less likely” to be relegated. That is a considerable distortion of the way in way in which the leagues operate. For that reason too, we think that the financial gap issue should be looked at more closely.
Obviously, it is right that there are solidarity payments, but the majority of those payments are concentrated simply in the parachute payment system. I therefore hope that the first “state of the game” report gives some close attention to that. It is worth observing too that, before the formation of the Premier League, domestic broadcasting money was allocated according to an agreed formula, with 75% being paid to the top-flight clubs and 25% to the other three divisions. I do not say that that is the right formula or that the 92% figure I referred to earlier is the wrong formula, but it is clearly an issue that need to be addressed.
In the last seven seasons, those clubs that have had parachute payments have managed to get back into the Premier League. In each of those seasons, two of the three promoted clubs received parachute payments. Looking at the Championship this year, the top three clubs are still in receipt of parachute payments. There is definitely a serious case to be examined.
We have heard a lot about the strength of the Premier League, and there is no doubt that it is the finest league in the world. I thought the statistics from the noble Lord, Lord Birt, were fascinating. They underline the confidence in our Premier League that exists in the football world. We want the distribution mechanism, as it works through, to be fairer and more equitable, and address some of the issues within the game. That is why we brought forward our amendments.
I conclude by making this observation: it is clear that the big divide in the consideration of this Bill is over the parachute payments. It is clear that noble Lords on the Opposition Benches are very much opposed to including them within the remit of the IFR. On our side, we think it only right that they should be brought into scope, and that was one of the major changes made between the previous Government’s Bill and our Government’s Bill. That is right, because it tries to ensure that there is some greater equity in the legislation. The noble Lord, Lord Pannick, put his finger on the issues, as did my noble friend Lord Watson.
I hope the Minister will give some consideration to the criteria point that we have raised in Amendment 309, if not in the Bill then certainly ensuring that it is carefully taken into consideration when the IFR is finally set up.
Lord Birt (CB)
To respond briefly to what the noble Lord just said, in my remarks I said that I think there is a case for looking at the weighting between solidarity payments and sustainability payments. That is exactly what I think the kind of measures that we discussed earlier would bring some clinical analysis to and come up with a considered answer.
Forgive me if I point out something else to the noble Lord. I am a lover of stats, and I have just looked up a stat, which is what proportion of Brighton’s revenues come from the Premier League. In the last year for which figures are published—so this will not be from this year—73% of the revenues of the noble Lord’s club came from the Premier League. He has to face the issue that if there were a material change in that, it would have an impact on the club and the Premier League and its appeal. This is about getting the right balance in all these things.
Lord Bassam of Brighton (Lab)
I agree that it is about getting the right balance—there is no disagreement between me and the noble Lord—and obviously I acknowledge the size of the support that Brighton & Hove Albion get. One should also put on record that our fans—I am a great fan, a season ticket holder and a 1901 Club member, for that matter—are incredibly grateful to Tony Bloom for the investment that he has put in. I do not entirely buy the argument that it is because of parachute payments. Back when Brighton were pressing for promotion in 2016-17, that was not foremost in anyone’s thinking, and I doubt whether it was foremost in Tony Bloom’s. But obviously we have to look at where the resource is spent, and that is why it is for the IFR to make that determination and to treat this issue with great care when it comes to a conclusion, based on the “state of the game” report.
Lord Goddard of Stockport (LD)
My Lords, for the first hour of the debate today, I honestly thought I was in a different Committee. The thoughtful amendments from the noble Lord, Lord Birt, and the reasoning behind them were more favourably reflected on by the Minister than almost any other amendment I have heard over seven nights. The helpful intervention from the noble Lord, Lord Pannick, about some technical issues, and his offer—probably to be accepted—of redrafting for a further thing, emphasise that we are drawing to a place where I think we can begin to make progress. Even the noble Lord, Lord Markham, was concise in his comments on those amendments in the spirit of trying to move the evening on, while still making the political points that he needed to make.
I was going to comment on the speech by the noble Baroness, Lady Brady, but the points have been made by the noble Lord, Lord Bassam, far better than I could: the Premier League does not have all the right answers, and it is about the pyramid and the lower clubs. This afternoon I met disability groups, women’s groups and other people concerned about the economics of football, and their real concern is whether they will ever see the benefits of whatever happens with this regulator, so that it does not just stay between the Premier League and the Championship. It is fine to say that the Championship is now one of the six best leagues in the world—that is to be supported—but below that are League One, League Two and the National League teams. We need to keep all those thoughts in our minds as we move forward.
Personally, I have absolutely no problem with the Premier League. It is a fantastic thing and I pay my money to watch it if I can—I wish I could have switched the fixtures around from last night to tonight, so that I would not have had to endure City throwing away a two-goal lead at Brentford. I could have missed that, listening to the enjoyment in here, but that is just the way the fixtures are thrown up, unfortunately.
What I am trying to say, clumsily, is that the regulator needs to be given responsibility. We can influence that responsibility by way of amendments in this and the other place, but it is very important that the Minister understands where those amendments are coming from, and for what reasons. I do not think that anybody in this Chamber does not believe that football deserves the very best governance and the very best people running it to keep its status as our national game. It is our national game, from Liverpool at the top right down to Southend and clubs at the bottom. Our group on these Benches just wants to ensure that we keep that focus, because you can lose it in the argument of the to and fro of the money, the percentages and how it is not fair. The fairness is not the point. The point is the 92 football clubs, which should be at the forefront of all our minds.
Lord Jackson of Peterborough (Con)
My Lords, I did not intend to speak on this group of amendments but, as with all the best Committees, you are sometimes prompted to contribute by the ebb and flow of the debate.
Just to respond very briefly to the noble Lords, Lord Pannick and Lord Bassam, of course we all want to see the best possible legislation. This is a scrutiny and oversight House, and we want to make sure the Bill is improved as it goes between the two Houses of Parliament. But we also do not want to respond merely to anecdote, whether it is the financial difficulties of a small number of clubs or the issue of the super league evolving as it did in 2021. I have gone on record as saying that the Bill is suboptimal—and that is polite. I would have said the same under a Conservative Government, and it bears repetition tonight. It was terrible then, and it is even more terrible under this Government.
I want to try to explain to noble Lords why, specifically on the issue of whether Clauses 61 to 64 should stand part, some of us have a philosophical issue. At the moment, I believe that although it can be quite robust and in many ways brutal, there is a self-correcting mechanism for the way football clubs are operated. There is a predisposition not to take inordinate risk in the future of small community clubs supported by the local communities in towns and cities across the country.
What slightly worries me is the concept of moral hazard, as we have discussed before, which is obviously quite an arcane economic concept. Incidentally, with respect to the noble Lord, Lord Pannick, I do not see that it is necessarily axiomatic that the Premier League has some moral duty, as businesses and as private entities with shareholders, to necessarily be a pseudo-charitable outfit and to provide for those in other leagues. The noble Lord might want to elucidate why he feels that is the case. Whether we believe it is a good or practicable idea is another issue.
Lord Watson of Invergowrie (Lab)
Is the noble Lord familiar with the concept of solidarity?
Lord Jackson of Peterborough (Con)
Yes indeed, comrade.
I suppose the significant point I am making is that not enough credence has been given to the efforts, which were very well enunciated by my noble friend Lady Brady, of the Premier League through very difficult times, economic downturns and, of course, Covid. At the moment we have that self-correcting economic mechanism to prevent smaller clubs making calamitous economic decisions that may end up with them closing, going into administration, et cetera—although of course, as we have seen from the figures, a relatively small number of clubs have been in that position.
Conversely, we are being asked to formalise in primary legislation a situation where we are putting in the hands of the IFR, along with very significant enabling powers, including Henry VIII powers, the right to redistribute wealth. It may be a simplistic argument but, as my noble friend Lord Markham said, it would be an unprecedented situation for a regulator to redistribute capital between entities. In other words, there will be no internal mechanism or sanction to prevent inordinate amounts of risk being taken. It would be a market distortion and there would be no disincentive for those clubs to make those decisions, as there is now.
That is the philosophical underpinning of why we support these clauses not standing part of the Bill. It does not mean that we do not care about community football clubs. We are being asked to vote not on a perfect piece primary legislation but on the Bill with 100 clauses that is in front of us today. For that reason, I support my noble friend’s contention that Clause 61 and others should not stand part of the Bill.
Baroness Evans of Bowes Park (Con)
My Lords, I have added my name to Amendments 302 and 304.
As I said in previous debates on the backstop, I have real concerns about the resolution process, and in particular the binding final offer arbitration model included. The Minister has repeatedly claimed, and said again today, that these powers are to be used only as a last resort, but we have heard from noble Lords across the House that this does not feel like the situation in which we find ourselves today. As has been identified by other noble Lords, the approach being legislated for in the Bill is unduly adversarial and pits two sides against one another rather than encouraging comprise and dialogue. As we have heard, the very existence of the proposed mechanism set out seems to have played a role in the breakdown of the latest round of financial negotiations, which is concerning and does not bode well for the future.
The Government would be unwise to dismiss and ignore this chilling effect, as the current backstop proposal threatens to undermine and damage relations across the football pyramid. The model just does not make sense. In any deal negotiation, if both sides are disappointed at the outcome reached, it is more likely that it has been fair and balances the two sides’ competing proposals. Yet, as we have heard, under the process set out in the Bill, rather than consider each proposal and determine the best approach—which may very well be a compromise between the two—the expert panel formed by the regulator must instead choose one of the proposals.
Amendment 304 gives the expert panel set up by the regulator to oversee the process the ability to combine elements of the proposals
“where it considers that this will result in an order which is most consistent with the principles in subsection (2)”.
This is a far more sensible approach. It does not mean that the regulator or its expert panel would be forcing a proposal on the two leagues involved. Rather, they can play a constructive role in facilitation and mediation to help achieve an outcome that both parties can agree with.
I really hope that the Minister will use the time between the end of Committee and the beginning of Report to discuss further some of the ideas that have been brought forward in this and, as I said in the previous debate, consult with the leagues and individual clubs again. A number of them have expressed concerns publicly about the process. I hope that she will think about tabling amendments that will be supported across the House at our next stage.
Baroness Twycross (Lab)
My Lords, I thank noble Lords for their at times passionate discussion on this group of amendments. I agree with the noble Lord, Lord Goddard, that it has been a good debate. All noble Lords who have taken part clearly believe in getting the best governance for our national game, which should be at the heart of discussions.
Let me be clear that the Government’s preference is for an industry-led solution. While we acknowledge that there is an existing agreement in place, if a new updated agreement cannot be reached, an industry-designed proposal, facilitated by the regulator, is the next best option. The model adopted by this Government for a backstop was in the previous Government’s Bill.
One of the dividing lines in your Lordships’ House is clearly on the rights and wrongs of parachute payments and their inclusion or otherwise in the scope of the regulator. This was referred to by, among others, the noble Baroness, Lady Brady, the noble Lord, Lord Markham, and my noble friends Lord Watson of Invergowrie and Lord Bassam of Brighton. I hope that we can all agree, not least because of the debate on this, that parachute payments are a significant part of football’s financial landscape. They clearly play an important role in supporting the survival of relegated clubs and the Government are clear on that.
However, the regulator needs to be able to consider all relevant revenue sources as part of the backstop process, to arrive at an accurate picture of any proposal’s impact on financial sustainability and the potential for distortion of the parachute payments. This is not to say that they must be included. It is to allow the regulator to include them if, having gone through the process with, for example, the “state of the game” report, it has arrived at the view that they should be included in the process.
Lord Markham (Con)
I thank all noble Lords, and I agree with the noble Lord, Lord Goddard, and the Minister that it was a good debate conducted in a good tone. I also thank the Minister for her helpful clarifying comments, particularly on Amendment 310 and the expert panel.
On the point raised by the noble Lord, Lord Pannick, I would like to make it clear that I think everyone agrees—I definitely do—that the Premier League should be paying over a share of its—
Lord Pannick (CB)
The noble Lord says “everyone”; he might like to have a conversation with the noble Lord, Lord Jackson.
Lord Markham (Con)
I will allow my noble friend to speak for himself, but I do not think anyone is saying that the Premier League should not be paying some of its money over, most of all because the Premier League voluntarily believes that it should be paying large sums of its money over because it is critical for the health of the whole game.
Lord Jackson of Peterborough (Con)
I fear the noble Lord, Lord Pannick, has misconstrued my comments. Perhaps it would be apposite to clarify that I was merely pressing him on the intellectual rationale for the assertions he made. That is a completely different issue from whether I agree that, being community minded, the Premier League should indeed disburse its funds generously to lower leagues.
Lord Moynihan of Chelsea (Con)
The noble Lord, Lord Watson, reminded us of solidarity. Does my noble friend agree that there is a great difference between legislative—which is to say coerced—solidarity, which some would call theft under the law, versus the voluntary and friendly solidarity that is already being shown by the Premier League? Does he agree that there is a fundamental difference between the two and that it is a subversion of the word to call it solidarity?
Lord Watson of Invergowrie (Lab)
The noble Lord is now making a distinction between solidarity and paternalism.
Lord Markham (Con)
That is precisely the point of this debate. I think everyone agrees that the Premier League should be paying money over, no one more than the Premier League itself. The whole question is whether it needs a regulator to enforce a set number. As my noble friend Lady Brady said, the Premier League is more generous than other leagues. As my figures showed, the Premier League pays over 14%, which is almost three times the level that UEFA pays over in its version of solidarity payments. The real point of the debate is whether we really need a regulator to determine it.
We have had a good debate on parachute payments. The noble Lord, Lord Bassam, made a particular point about Brighton and how it did not need them. It is a little known fact that that a job I never got, although I was through to the final round, was being CEO of Brighton many moons ago, when it was a Championship team and was pressing for the Premier League. I recall very well a conversation with Tony Bloom when he was interviewing me for that job. I still think he is a brilliant chair, and I cannot argue against Paul Barber, the CEO; given how good he is, I cannot deny that he chose the right candidate.
Lord Bassam of Brighton (Lab)
The noble Lord is obviously used to being a runner-up in these competitions.
Lord Markham (Con)
That hurts. Tony Bloom made clear to me that Brighton’s whole business plan depended on what he called “the yo-yo”. West Brom had just done it at the time: you get promoted and make some investment in new players. You then expect to go down and have the benefit of parachute payments to build more players up again, so you slowly get to the level, through the yo-yo, where you can be sustained.
Baroness Taylor of Bolton (Lab)
While the noble Lord is talking about parachute payments and the yo-yo, he used the figure of 14%. If you take out parachute payments, is the figure not an awful lot lower and actually near 4%?
Lord Markham (Con)
I am sure that we can get the absolute reference from the statto—the noble Lord, Lord Birt, will probably calculate it and tell us by the end of the debate. I think the figure is about 9%, but we can check that.
The point I was trying to make is that Tony Bloom, the chair of Brighton, and Paul Barber, its CEO, whom I have spoken to during this process, would say that parachute payments were a very important part of their business planning in giving them the confidence to invest, which allowed Brighton to stay up and thrive in the Premier League. There is a very good argument for them being there.
As much as I would like the regulator not to get involved in redistribution payments, I accept that it is likely that those powers will be granted. If we really narrow it down, the debate on this group and the previous one is all about the negotiation mechanism. That is where I appreciate so much the work that the noble Lord, Lord Birt, has done on this, because it is not a political point. I do not think anyone in the outside world would get into the intricacies of and care more broadly about the negotiation mechanisms that we are talking about, but what we are talking about is, as the Minister said, a theory behind binary choices and what will happen in terms of gaming. It is an untried theory that has not been done anywhere else, and it has been put forward. I thought the Minister said that it had not been done by the commission.
Baroness Twycross (Lab)
It has not been used by the Competition and Markets Authority yet, even though the previous Government gave it the powers to do so. It has been used successfully in other jurisdictions —for example, in Australia and Canada. I have other examples that may be in my speaking notes later in the evening, but I am happy to share them.
Lord Markham (Con)
That would be very helpful, because the main point here, and what I hope we can achieve between now and Report, is that we know that there is a small group of economists at the DCMS who have put together this mechanism. There are noble Lords here who have been involved in media sports rights deals and these sorts of negotiations who can add real value to this. There is a real opportunity between now and Report to engage with those officials to really get into those negotiation mechanisms, because this is what we have narrowed it down to and that is what this debate has been useful for. I hope we can use that time productively.
Baroness Brady
Baroness Brady (Con)
My Lords, I shall speak also to Amendment 312. These amendments would ensure that any distribution order affecting parachute payments is introduced with a three-year, rather than one-year, transition period, and that an order would come into effect only from the start of a new football season.
Before I give the Committee my experience of why that is so important, having spent 32 years running Premier League and EFL clubs, I want to make the point that I think there is a total misunderstanding in the Committee about parachute payments. Parachute payments are not about helping clubs get promoted into the Premier League; they are about helping Championship clubs that are promoted into the Premier League to have the ability to invest to give them a chance to stay in the Premier League. You cannot invest to stay and be competitive in the Premier League if you do not know that there is some sort of safety net to help you in the event of relegation. My Amendments 311 and 312 are, in my view, essential to safeguarding the stability and sustainability of English football, particularly for those clubs that face the challenges of relegation.
As I have said before in the House, parachute payments are not a luxury or a reward for failure. They are an essential tool that encourages the competitiveness, investability and financial sustainability of English football. Without them, relegation would create a financial free-for-all and a cliff edge that could devastate clubs, their communities and the broader ecosystem. Without them, newly promoted clubs cannot invest in their squads to ensure that they have any chance of remaining in the Premier League.
Baroness Taylor of Bolton (Lab)
Will the noble Baroness acknowledge that they distort competition in the Championship?
Baroness Brady (Con)
I do not say that they do or do not. I am saying that, if they were not there, you would have to invent them. If a club is promoted from the Championship to the Premier League and cannot invest in its team to stay in that league, it is automatically almost certain to be relegated. If an established club, such as those mentioned earlier, is relegated, without the parachute payment it will be in financial trouble. Some 50% of all administrations come as a result of relegation; that is why parachute payments are fundamentally important. They are designed to manage the financial shock of relegation, where clubs could lose significant revenues, almost overnight, while their costs remain fixed.
For a recently promoted Premier League club, squad costs alone average £115 million a year, with most player contracts running for three to five years. Relegation means that clubs face an average shortfall of £165 million over three years, even with parachute payments included in that equation. It is important to recognise, therefore, that they do not help clubs avoid a painful transition but soften the blow to a degree. Without them, the financial impact would escalate from being very painful to being catastrophic.
Lord Bassam of Brighton (Lab)
I remind the noble Baroness that parachute payments have not always been at the level they currently are. In 2010-11 parachute payments were something like £30 million; by 2020-21 they had escalated to £233 million, which is an eightfold increase. This was during a period in which player wages only doubled. The noble Baroness’s point about the need to ensure that there is no cliff edge around financial commitments to players is not entirely valid. Why did the parachute payments need to grow so rapidly and by so much during that period?
I do not argue against the principle of parachute payments; I recognise their importance and the need to soften the blow that is a product of relegation. But the noble Baroness must accept that they have a distorting impact on promotion bids by Championship clubs. Over the last seven seasons, 14 of the 21 clubs promoted were in receipt of parachute payments, where previously that was not the case.
Baroness Brady (Con)
As the noble Lord pointed out, wages have increased. Newly promoted Premier League clubs have an average wage bill of £115 million and transfer fees have gone through the roof. That is why the costs are fixed. If a club is relegated, it cannot terminate its players’ contracts; they are honoured, as clubs are obliged to pay those contracts. The parachute payment helps soften that blow. Parachute payments put restructuring responsibly at the forefront of clubs’ minds. Relegated clubs have to sell players, but they also have to buy players, reduce their wage bill and recalibrate costs to adapt to life in the Championship. What these payments really do is help clubs avoid wholesale disinvestment, panicked fire sales or, worse, administration.
Parachute payments work. They do not distort competition; they enable it. That is why versions of parachutes are used all over Europe and throughout the EFL system. Clubs such as Brentford, Brighton, Nottingham Forest and Crystal Palace have all demonstrated that well-run, innovative clubs can rise through the Championship without parachutes and build competitive, successful teams in the Premier League. Parachute payments are a stabiliser for relegated clubs, not a barrier to promotion.
Without these payments, the competitive balance, investability and appeal of both the Premier League and the Championship would be put at risk. Investors in the Championship recognise that parachute payments provide the essential scaffolding for strategic investment. These payments enable clubs to build towards promotion with confidence, knowing that there is a safety net. Parachute payments create the conditions for clubs to invest in players, infrastructure and long-term strategic plans, with the assurance that one challenging season in the Premier League will not unravel their progress and render all that investment worthless.
Lord Addington (LD)
My Lords, when it comes to parachute payments and what they imply—that is, the survival of a fall—I cannot help but feel that if we made what clubs were falling on a little softer, it would improve their chances. We have a situation here of deciding whether to cushion the fall or let clubs float down. Some combination of the two might be appropriate. Let us remember that no situation will remain as it is now; we cannot guarantee that consumption patterns and the way football is viewed will not change over time, because they already have.
So, what I would say about the noble Baroness’s amendment is that maybe the timescale would be easier if it was longer. What is the Government’s thinking about stability to allow this survival to come out? We do not want people being destroyed by it—the noble Baroness is quite right. Equally, having the “cosy club” of those who have tried and failed and come back up again is not that desirable. How you have a civilised or better way of getting out of that situation is something that we want to look at here. I do not know whether there is a right answer here, but we need to look at the way this happens and how those clubs are going to survive and continue as clubs. When I looked at this Bill, I thought that was the most important bit. You have the Premiership which makes lots of money and the rest of it which apparently we want to keep. How you square that circle is what we are talking about here. The Government’s thinking on this is what I would like to extract from this discussion.
Lord Markham (Con)
I will be brief because my noble friend Lady Brady made the points extremely well and we have debated parachute payments quite a bit already this evening. The only thing I would say is that they give clubs in the Premiership the incentive or the confidence to invest and in my understanding every European league now has some variation on that, because it is seen as a system that works. It is fundamental to the competitiveness of the Premier League. It underlies its whole audience appeal and broadcasters all round the world will make media sports rights payments to see such an exciting and competitive game.
It is known that we would prefer that parachute payments were not included but, if they are going to be included, the proposal to make a three-year safety net as opposed to a one-year safety net is very sensible. In the conversations that the Minister helpfully set up with her officials, I could tell that it was something they understood and were quite well disposed towards. The fact, as my noble friend Lady Brady, said, that contracts for players are for three years shows the importance of having that. So I hope that this is a sensible amendment that the Minister can speak to.
Baroness Twycross (Lab)
I committed earlier this evening to come back to the noble Lord, Lord Hayward, on whether the shadow regulator would join the Chancellor’s meeting with regulators tomorrow. My understanding is that the Chancellor’s invite has gone only to regulators who are currently operational. Therefore, the shadow football regulator has not been invited to the specific meeting to which the noble Lord referred. I would add, however, that I have heard many good points made on growth during the Committee stage of the Bill and look forward to returning to further discussions around that point on Report.
In relation to the group under discussion, I thank the noble Baroness, Lady Brady, for bringing her concerns regarding the future financial sustainability of relegated clubs to my attention with this amendment. I note the clarity from the noble Lord, Lord Markham, in relation to the Opposition opposing parachute payments being included in the Bill. As I made clear in my response to the previous group, the Government agree—and I hope this gives the noble Baroness some reassurance—that parachute payments play an important role in supporting the survival of relegated clubs. This point was also made by my noble friend Lord Bassam of Brighton, even though he had a different perspective from the noble Baroness, Lady Brady.
I highlight first that in the Government’s view it is not inevitable that the backstop would address parachute payments. They will be addressed only if they have been identified as a relevant question for resolution, which will happen only if they are proven to have a substantial impact on the sustainability of the pyramid.
The noble Lord, Lord Addington, asked some pertinent questions, not least relating to the survival of clubs. If parachute payments are deemed relevant for consideration, the Bill currently specifies that they cannot be reduced within a year of the distribution order coming into effect. This point was made by the noble Baroness, Lady Brady. This amendment would extend this period to three years, triggered at the beginning, rather than the end, of a season.
While I genuinely understand the core concern behind this amendment, we must balance the desire to ensure that relegated clubs have as much time to adjust to changes as possible with the need to ensure a new, timely, satisfactory agreement. We would expect the leagues to maintain effective communication with clubs throughout the backstop process which, alongside the existing year-long transitionary period, will mean that clubs have ample time to adjust if parachute payments are deemed in scope. There will be no sudden reduction in payments without warning.
Before I finish, I again urge the leagues to come to an agreement on a new package of financial support under their own steam, which is in the long-term interests of the game. However, for the reasons I have set out, I regret that I cannot accept these amendments and hope the noble Baroness will not press them.
Baroness Brady (Con)
My Lords, I am grateful for the contributions made by noble Lords on this group. To the noble Lord, Lord Addington, I say that, in my experience, if you cut some of the ropes on a parachute it certainly does not provide for soft landing; it results in a crash. That is what I think I am trying to help avoid here.
I thank the Minister for her response and I am sorry that we do not yet seem to agree. I want to emphasise again that, while the Government seem to believe they have prevented parachutes from being abolished under this legislation, they have literally created a Bill that allows the regulator to choose between only two proposals. One of the proposals is going to come from the organisation that called parachute payments “an evil that needs to be eradicated”. The Bill specifically enables the kind of system that the Minister says the Government do not want to see, and that really is an intolerable risk to the Premier League clubs, newly promoted clubs and relegated clubs.
It may be helpful to stand back and remind the House that this Bill principally seeks to address financial sustainability across the game. Yet, the removal or severe restriction of parachute payments would undermine that very goal. Around 50% of football administrations follow a relegation event. Take away parachutes or alter them without proper transition periods and that number will, sadly, undoubtedly rise. For the Premier League clubs at the lower end of the table, a one-year transition period will fundamentally alter all their risk calculus. These clubs invest heavily in players, infrastructure and youth development, knowing that the current system provides some financial security in the event of relegation. Remove that security and I call tell you that the calculation changes. Risk taking diminishes, investment shrinks and competitiveness suffers. That is exactly the same for newly promoted clubs. It is impossible to invest in your squad if you do not have that safety net, if it is not successful for you.
I continue to believe that these amendments are a necessary safeguard. Of course, much greater changes to the backstop are required, but a transition is a vital element to examine. These amendments would provide the time and clarity needed for clubs to adapt responsibly, protect the legitimate expectations of all shareholders and preserve the stability of the football ecosystem.
I urge the Government to give these measures further consideration, please, as part of a fundamental reconsideration of the backstop, just as UEFA has explicitly called for, to ensure that this Bill really can achieve its intended purpose of promoting sustainability across the game. I will withdraw this amendment today, but I say respectfully to the Minister that I really hope that she reflects carefully on my amendments.
Baroness Twycross
Member's explanatory statement
This amendment corrects an erroneous cross-reference.
Baroness Brady
“(ea) any decision made under sections 62 and 63;”
Baroness Brady (Con)
My Lords, Amendment 322 would enable scrutiny of backstop decisions through merits-based review by the Competition Appeal Tribunal. I will also speak to my consequential Amendments 324 to 326 and 333 to 335. Let me seek again to give noble Lords a picture of what I believe is at stake.
The Premier League represents a remarkable British success story, yet the Bill introduces a mechanism that could unravel three decades of innovative ecosystem building in a single regulatory decision. Every few years, a regulator will be forced to make a binary choice between two competing visions for English football. One vision, that of the Premier League, seeks to preserve the delicate balance that has made it the best and most compelling league in the world. The other, explicitly stated by the EFL, aims to fundamentally restructure football’s finances and systems, describing key stability measures as “evil” and seeking their “eradication”.
This is not some narrow funding dispute; what the Government may so far have failed to understand is that this is about the very architecture of English football. It could eliminate the financial scaffolding that enables newly promoted clubs to compete. It could destroy the stability mechanisms that give investors confidence to back ambitious Championship clubs. It could force smaller Premier League clubs to abandon investment and aspiration. This is why merit-based reviews matter profoundly.
Under the Bill, even the most extreme regulatory decision could be challenged only on narrow procedural grounds. Let us think about what this means: a panel could select a proposal that devastated relegated clubs, and those clubs would have no meaningful right of appeal even if that decision threatened their very existence. The Competition Appeal Tribunal would offer a better solution. It brings expertise in complex economic matters and an understanding of how regulatory decisions ripple through competitive markets. Its oversight would drive better decision-making, ensure genuine fairness and protect the investment that makes English football thrive.
This speaks to a broader principle: football is not a utility delivering water through pipes. It is a dynamic ecosystem where success depends on calibration of risk and reward, yet the Bill repeatedly treats football like a water company, relying on judicial review as the primary check on regulatory power—and we all know how well water regulation is going. This creates a fundamental mismatch.
We are asking a regulator to make complex commercial decisions that could reshape our national game, yet we deny affected parties any meaningful right to challenge those decisions on their merits. This occurs throughout the Bill on all sorts of matters relating to ownership, financial regulation, licensing and stadia. Almost nothing, including this multi-billion pound decision about the distribution of the Premier League’s own revenue, is subject to merits-based reviews. Let me say again: I do not oppose regulation. These amendments are a limited attempt to ensure that regulation can operate fairly and sustainably.
As I said earlier this evening, the Premier League has consistently demonstrated its commitment to the wider game through solidarity payments, infrastructure funds and community programmes that reach millions, to the tune of £1.6 billion every three years. During Covid, we ensured that no club went to the wall, but good stewardship is a two-way street, and this statutory regulator requires proper safeguards. Without merits-based review, we risk regulatory decisions that could inflict profound damage on the game we love. The backstop could become a weapon for levelling down, rather than building up, replacing aspiration with survival as the pinnacle of a club’s ambition.
English football is at an important juncture with this Bill. Get it wrong and we risk something precious: not just the Premier League’s global success but the entire pyramid’s vitality. This amendment provides one —and only one—essential protection against regulatory overreach. There are plenty more needed, but I urge the Government and other noble Lords to support it.
Lord Markham (Con)
My Lords, Clause 84 details the provisions that may be brought before the Competition Appeal Tribunal. However, as drafted the Bill does not include any decisions made under Clauses 62 or 63 for appeals that may be heard before the tribunal. Given the implications of these two clauses, relating as they do to the distribution of revenue, it is wholly inadequate that the determinations made under them are not subject to an external appeals process. Therefore, my Amendment 323, and the amendments in this group tabled by my noble friend Lady Brady, ensure that any decisions made by the committee of the expert panel relating to distribution orders are reviewable under Clause 84.
I do not dispute that the Bill already provides for distribution orders under Clause 62, and for reviewable decisions under Clause 81. The latter clause states that reviewable decisions are any decisions listed in the table in Schedule 10, and Schedule 10 does include decisions made under Clause 62. However, this relates only to internal reviews. Schedule 10 also states that any internal review of distribution orders is to be carried out by a different committee of the expert panel. Therefore, although the composition of the deciding and reviewing committees must be different, the review will still be carried out by the same body.
Therefore, the Bill currently gives competition organisers the right to appeal only to a component of the regulator. This cannot be right. The imposition of a distribution order under Clause 62 is surely the measure that most affects competition; requiring one league to distribute its money to another league will impact its competition ability. Surely, then, any distribution decision should be reviewable by the Competition Appeal Tribunal.
Baroness Twycross (Lab)
I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Markham, for tabling these amendments. I recognise that the intent of the amendments in this group is to ensure that decisions related to the distribution backstop are appealable and subject to a merit standard of appeal, rather than being based on judicial review principles. I understand that this comes from a belief that a merit standard of appeal is necessarily preferable because it would allow the Competition Appeal Tribunal to opine on the merits of the case, rather than just on whether the correct procedure was followed, and thereby arguably offers better protections for affected parties. In this instance, I do not believe that this is the right process.
In truth, it means that a tribunal, which most likely has less technical expertise and background knowledge of the specific issues surrounding financial distribution in football than the regulator, will be able to substitute its own decision for that of the regulator’s. For example, if the regulator were to choose one of the two proposals as part of the backstop process, and make an order imposing that distribution arrangement, the Competition Appeal Tribunal could overrule this and choose the other proposal. Indeed, if we consider how this would most likely play out, the aggrieved competition organiser whose proposal is not selected would be very likely to lodge an appeal regardless.
These amendments would be tantamount to making the Competition Appeal Tribunal the ultimate deciding authority on the financial distribution arrangement in football. This would, in effect, mean cutting out the middleman and having the courts decide how much money should flow down the football pyramid. It is unclear to me why noble Lords, or indeed anyone, would think a court making this decision a better option, rather than the expert panel of the independent football regulator, or why this would necessarily lead to a more robust, more favourable or fairer outcome. It is simply the case that there are certain decisions better suited to certain standards of review.
We have engaged with legal experts and senior members of tribunals while developing the Bill. They agreed that the courts are not necessarily well placed to substitute the decisions of expert regulators on matters of technical regulatory judgment, and that a judicial review standard of appeal would be more appropriate for those types of decisions. This is also a common approach taken across other regulators. For example, the majority of decisions made by Ofcom are subject to appeal on judicial review standards.
By contrast, some of the possible enforcement decisions that the regulator can take under the Bill represent highly punitive actions. For these highly punitive, less technical and less market-specific enforcement decisions, a merits appeal is more appropriate. For example, we are of the view that courts are far better placed to opine on whether the severity of a punishment is appropriate to the infringement than on whether a certain distribution of revenue is better for the financial sustainability of English football. Ultimately, an appeals process should provide the appropriate opportunity to challenge whether a regulator is acting fairly and within its statutory remit. It should also be a focused and efficient process that does not excessively delay the final resolution of decisions or hinder the regulator in achieving its objectives.
While providing effective assurance of the regulator’s decision-making process and judgment, the appeals system should not unduly undermine the expert independent regulator. The Bill effectively balances these different considerations, including through the standard of appeal. The amendments tabled by the noble Baroness, Lady Brady, would also make every decision under Clauses 62 and 63 reviewable, subject to the statutory route of appeal to the Competition Appeal Tribunal. This includes minor and operational decisions such as the giving of notice or extending the period to submit proposals. For the same reasons I have already outlined—balancing fairness, efficiency and appropriate deference to the regulator—we do not believe this is necessary and it is not the approach we have taken in the Bill.
Amendment 326 would be contrary to Amendments 322, 324 and 325. The Competition Appeal Tribunal could not simultaneously review a decision on judicial review principles and on the merits. On Amendments 333, 334 and 335, as I have set out, we disagree with the intention to make every decision under Clauses 62 and 63 a reviewable decision on the merits. However, if that were the intention, additions to the consequential amendments of other Acts, or the Competition Appeal Tribunal rules, certainly would not be the way to do it. For these reasons, I cannot accept the amendments and I hope that noble Lords will not press them.
Baroness Brady (Con)
My Lords, I am grateful for the Minister’s response, although I confess that I remain far from reassured. The logic of the Government’s position appears to be that procedural correctness matters more than getting the right answer for English football. Consider what we are being asked to accept: a regulator with new, unprecedented powers to reshape our national game, yet its decisions can be challenged only if its ticks the wrong procedural boxes.
The Premier League drives investment throughout the pyramid. It enables clubs such as Brighton, Brentford and Nottingham Forest to climb through the lower leagues without parachutes and compete at the highest level because of the security they provide. It funds grass-roots facilities in every corner of Britain. It projects British soft power globally in a way that no other cultural export can match. Yet under this Bill a single regulatory decision could fundamentally alter the mechanisms that make all that possible.
The Minister suggests that a judicial review provides adequate protection, but what comfort is that to a relegated club facing financial ruin because a regulator chose to abolish parachute payments? What protection does it offer less well-established Premier League clubs forced to abandon investment because the regulator selected a proposal that makes relegation catastrophic?
Lord Moynihan
“Review: cost of complianceWithin six months of the day on which this Act is passed, the Secretary of State must lay before Parliament a review of the financial impact on regulated clubs of complying with the provisions in this Act.”
Lord Moynihan (Con)
My Lords, I am very pleased that the noble Lord, Lord Pannick, has just returned. He will be in an exceptionally good mood as his club has just gone 2-1 up with about a minute to spare before half-time. That will put him in a good mood to support my amendment.
Amendment 327 was tabled in the name of the noble Lord, Lord Maude, who is abroad on business and apologises for not being with us this evening. It is a straightforward, simple amendment, which I hope will have support from the noble Baroness, Lady Taylor. She and I have both been concerned about the potential financial impact of the Bill, particularly on clubs in the EFL. Pursuant to her earlier intervention, I am here not on the EFL side or the Premier League side but genuinely to look at the legislation and make sure that good legislation comes out of our deliberations.
One of the areas of particular concern is the cost. This is new; it is the first time it has happened not just in this country but anywhere in Europe for a sport. It is novel, and that word is used quite extensively in the Government’s impact assessment. It is important, therefore, to have an opportunity in Parliament to consider the costs of setting up the regulator and the initial costs of regulation. That is why Amendment 327 proposes:
“Within six months of the day on which this Act is passed, the Secretary of State must lay before Parliament a review of the financial impact on regulated clubs of complying with the provisions in this Act”.
That will give us an opportunity to consider whether it is massively inflated in comparison with the expectations set out in the impact assessment or if there are cost savings. I think the noble Baroness is about to intervene, so I am happy to give way.
Baroness Taylor of Bolton (Lab)
I am about to intervene. The noble Lord is somewhat optimistic in thinking that everything can be revealed within six months. I will make a broader point, which we are not specifically discussing tonight. The role of Parliament in holding regulators to account is where many of these considerations could usefully come in.
Lord Moynihan (Con)
The noble Baroness makes an important point but, in the context of this, I think her first point was even more relevant. Perhaps at a later stage, more than six months would be appropriate; maybe a year would be appropriate. Either way, it is appropriate that Parliament has a look at the costs of implementation, not least because there will be views among parliamentarians about where that burden should fall, and whether it should fall on some of the EFL clubs that might find it difficult to afford those costs of following this legislation. It is interesting that the French regulator who covers professional football confirmed yesterday that he has five staff to do the job that we are looking to cover with this substantial regulation. He also has 18 volunteers from the leagues, including the French FA, who make up their boards and committees to do the work that we have been considering so far in Committee.
The reason for moving this amendment is the concern about the uncertainty of the additional costs to be imposed on all 116 clubs as a result of the financial regulations set out in this Bill. I am not going to go into the details of questioning each and every figure, because that would be inappropriate, but I think it is worth looking at areas of the impact assessment that lead me to worry about the potential increase in costs that this could result in, not least because there is no estimate of litigation costs involved with the regulator, and we have heard that there is quite a lot of potential litigation that could be flowing as a result of the role of the regulator.
Initially, these litigation costs in the Bill will be funded through fines and interest as a first recourse, and that is set out Clause 96; but the further costs to cover litigation would come via the levy—in other words, come via the clubs themselves, and not be a burden on the taxpayer. That could lead to perverse incentives when it comes to the advocacy-first proportionate enforcement model. The legal costs should not be underestimated when you bear in mind that in the last financial year the Premier League had some £40 million-worth of legal costs alone. We should add to that the potential for legal costs associated with what we have been discussing this evening. I hope they do not come to fruition, but it is perfectly possible that they might, with parachute payments and the backstop.
In the context of trying to establish a cost base for clubs and the government regulator, it is really important that we look in detail at the impact assessment. It addresses costs in three buckets: familiarisation costs of £400,000 to £1.2 million, covering the one-off costs to business occurring in the first year of the appraisal period; compliance costs, which potentially go up to £35.8 million over the 10-year appraisal, which are the ongoing costs to business following the first year of the appraisal period; and then the operational costs, which are significantly higher. While these operational costs will initially be funded by the Exchequer before an industry levy is introduced, the costs will subsequently be clawed back from all clubs.
The role of the regulator and the work required by clubs is based on the belief that professional football in this country is in crisis and requires government intervention to sort it out. The legislation addresses what it has set out to be perverse incentives and misaligned owner motivations which have resulted in excessive risk taking in pursuit of sporting success and promotion. Those are quotes and they are meat to any lawyer immediately before this Bill is even on the statute book. Ultimately, the Government argue that this has resulted in market failure, despite the Premier League being the most successful football league in the world and the Championship the sixth-richest in Europe. However, the Government have ignored that and believe, as is clearly set out in the impact assessment, that government intervention is necessary to correct market failure.
There are complete sections on the problems that the Government believe have led to this market failure. Briefly, in 1.2.1 on page 9, the Government believe there is a perverse incentive for clubs to overreach financially. I anticipate that will be challenged. Paragraph 1.2.2 states that inequitable distribution across the English football pyramid has exacerbated poor financial and operational management. Paragraph 1.2.3 states that unsustainable financial management exists, in the view of the Government. Paragraph 1.2.4 covers poor operational management where financial mismanagement has been exacerbated by poor-quality operational management and decision-making at clubs. That is quite a statement to address towards professional football clubs in this country.
Paragraph 1.2.5 states that clubs will need to spend more to
“take into account the interests of fans/communities”,
which currently they do not sufficiently consider. But the impact assessment does not set out how much this is, or make costs, or rectify any of the other broken aspects of professional football that I have outlined this evening. It argues that the existing regulations have “proved ineffective” and it states that the
“free market will not rectify the football industry’s problems”.
In paragraphs 1.3.2 and 1.3.5, it says that
“market failure has large spillover impacts on society”,
which it does not cost.
In paragraph 1.7.5, the FA is blamed, with the Government concluding that,
“given the inaction of the leagues and the FA, the preferred option is to establish a new statutory independent regulator rather than industry self regulation or a light touch intervention”.
That is somewhat at odds with what the Minister was saying, because she argued quite strongly that light-touch regulation was what was sought—but in the impact assessment it is made clear that the Government favours having an independent regulator rather than
“industry self regulation or a light touch intervention”.
If it is not to be light-touch intervention and it is to be heavy intervention, that will incur significant costs, and it is not clear at all what those costs will be.
This is important, because the Government are rejecting in this document light-touch intervention on the French model for comprehensive state-controlled regulation, which will cost all clubs substantial internal costs and legal costs, potentially with the cost of lawyers and outside advisers for sure, to comply with the tasks outlined in the Bill, since all clubs will need to be licensed and meet in detail all the requirements in this lengthy and comprehensive legislation. To believe that this can be done for £40 million a year under preferred option 4 over the coming 10 years is, to be quite honest, fanciful. It ignores the legal costs and the club operating and compliance costs for all 116 clubs, and it ignores potential litigation costs. It beggars belief to believe that the total central estimate for familiarisation to the clubs and leagues associated with option 4 is £800,000, or £7,000 a club on average. The compliance costs outlined in paragraph 211 are estimated at £100,000 per annum for Premier League clubs and £60,000 for all remaining clubs. I do not see for the life of me how that is possible.
However, at least the Government have added the rider that familiarisation compliance costs “may be underestimated” and that
“this is a novel and high profile area”.
It certainly is that. So, the Government suggest,
“clubs may pay more attention and buy in high-end specialist advice”.
But high-end specialist advice does not come for £7,000 a club per annum.
However, all this is predicated on the most important paragraph, paragraph 289, towards the conclusion of the impact assessment, which states:
“The Regulator will be legally prohibited from intervening in football (e.g. spend on players) or commercial (e.g. ticket price) activities, thus limiting the potential risk of deterring investment”.
We have spent dozens of hours looking into the fact that there will be detailed and intrusive activities by the regulator—understandably, to fulfil the legal requirements of this Bill. Far from not being interventionist in football, the regulator will in fact be legally required to intervene in the running of all aspects of the financing of football, including external factors such as season ticket prices and other ticket prices, in its overview of the finances of all clubs. There is nothing on the finances of the clubs in this legislation that is exempt from the consideration of the regulator, if he or she should wish to look at that in the context of fulfilling their functions under the legislation.
What it should say, as I say, is that the regulator is legally required to intervene in the running of all aspects of football—and, if that is the case, there is a whole different scenario for the costs involved for all clubs. I am not talking about just Premier League clubs or EFL clubs—I am talking about all clubs. That is why I would hope that there would be an opportunity to review the costs at six months—or it could be year—because this is the first time this has ever occurred in sport in this country. It is indeed the first time that it has ever occurred in football in the European Union, or indeed in any international body that I know of.
The statement that I have just made underpins the whole cost structure and sits uncomfortably with paragraph 298 of the impact assessment, which provides for the regulator to enter business premises in conjunction with an investigation or an actual or suspected breach of a club’s licence conditions in any form with its powers of search and seizure and the power to require specified persons to attend an interview. Given the likely cost of this intrusive legislation, I believe it is important to write into the Bill a review of the financial impact on regulated clubs of complying with its provisions, so that football fans can regularly review the true costs of government-led regulation. I beg to move.
Lord Addington (LD)
My Lords, to follow up on the point from the noble Baroness, Lady Taylor, will the Minister tell us how the Government seek to enable Parliament, and indeed the Government, to look at how this is working when it comes in? There are provisions and, as the noble Baroness, Lady Taylor, sensibly put it, we are looking more at regulators, basically because of a failure of regulation—it has occurred in many fields. When you have a new regulator, you should review it. What is the process of review that the Government have in mind or going on? I hope that it is not a matter of waiting for failure.
Lord Hayward (Con)
My Lords, before I come on to the question of compliance costs specifically, I return to an answer the Minister gave me in response to a question I asked at the start of the debate this evening. It was on whether the shadow regulator would be present at the meeting with the Chancellor tomorrow. The response that the Minister gave—I hope I have it correct—was that the shadow regulator would not be present because the invitation was to existing regulators. I note that the Minister is nodding to that, so I presume that I have the phraseology broadly correct, and certainly the message correct. To be honest, I find that staggering. We have been told that the shadow regulator body— I was present at the meeting recently with the shadow regulator and his staff—should be up and running so that the regulator can take over a body that is already in full operation. We were told how many staff had already been recruited. We have been told persistently that this is light regulation.
I refer here to the fan-led review by Tracey Crouch. On page 15, paragraph 15 states that there are five important factors that should be pursued, including, in sub-paragraph (d),
“minimising burdens on clubs or an expensive system”.
Surely a shadow regulator that is going to hand over an up-and-running system and is going to operate a light-touch process of regulation should be invited to a meeting with the Chancellor to discuss precisely that issue. I am at a loss, as I think a number of people in this Chamber are, to understand why the shadow regulator has not been invited to that meeting. I am afraid that it indicates to me the attitude of the Government towards the role of the regulator in this process.
I now turn to the question of compliance costs. I do not intend to cover the issues that the noble Lord, Lord Moynihan, has covered so effectively, but I would like to cover a number of other issues. The noble Lord, Lord Moynihan, made reference to the fact that we were talking about all football clubs. The concentration throughout all our days in Committee has been overwhelmingly to do with the Premier League and the Championship. But when one is talking about the sorts of figures that the noble Lord, Lord Moynihan, was referring to—I have pursued persistently the honest assessment of what the actual cost is for a club, whatever it may be—the Minister has said persistently to me and others that the costs would be proportionate.
It is therefore relevant to remind this Committee what the turnovers of the small clubs are. I am quoting from Deloitte’s figures for the season 2022-23, which I understand are the last figures currently available. The average revenue for a club in League One is £9.8 million. The average figure for clubs in League Two is £5.5 million. Therefore, the categories of hoped-for costs identified in the analysis that the noble Lord, Lord Moynihan, gave earlier fall very heavily on a club.
I will cite a few examples. AFC Wimbledon’s revenue is £7.4 million, Crewe Alexandra’s £4.1 million and Northampton Town’s £5.1 million. I have looked for the figures for Stockport County, but I am sorry: I do not have them. I would give them if I could. If there are to be a series of compliance costs on top of all the other costs faced at the moment—not least national insurance contribution charges and the like—that will make a pretty big hole in the revenue of a club with a turnover of £5 million to £7 million.
The Minister has said that the burden would fall proportionately on the biggest clubs. In an earlier contribution, I said that when I was head of the British Beer & Pub Association I had the responsibility of steering the introduction of substantial changes in licensing legislation, which we did with the full agreement of government. The burdens do not fall proportionately on the biggest companies. They can employ a compliance officer or two but, in a small company or a small football club, you do not have a compliance officer so you have to turn to other people for advice. It therefore takes longer and costs more.
It is like anything in life. If you own a large number of flats as opposed to one home, and you take out insurance and are filling out a form, you know only too well that if you have done it once for one flat, it is just the same the next time. If you are dealing with one property, you do not know because you have never been confronted with the issues before and so you have to turn to other people for advice. The burden is not proportionate. There is a massive imbalance between big clubs with huge turnovers and the smaller clubs living completely hand to mouth.
I have quoted once already from the review. The point I want to raise was triggered by the presentation from the shadow regulator. When he was talking about staff, I believe he said that it had just recruited five people for IT systems. We are told, indicatively, that the regulator is likely to employ some 250 people—that is more than 10% of the total of DCMS’s staff, covering all the range of its departmental remit. Are five people needed for an IT system?
Then I actually looked at the review. There was reference earlier this evening to the question of clubs in terms of a few clubs. In fact, the review says:
“Many clubs are poorly run”.
It goes on to say of the regulator:
“The Review has … concluded that the new financial system should involve real time financial monitoring”.
That is what those IT employees are there to do. They are not there to operate the regulator, because you do not need that many for the day-to-day operations of a business of that size. It is about investigating the processes. When they go to a club and ask it to produce the information, it will say no, because it operates on a completely different system.
When I was first involved with boundary changes, we tried to get figures out of local authorities about the number of voters on an electoral roll. Noble Lords might imagine that the returning officers from different authorities would operate on identical systems. No: they were on four different computer systems. It took several years to get the accurate figures. This is precisely what will happen with the small clubs. They will be operating their own systems, when suddenly along will come the regulator to say that it wants the information, but that it wants it in its own computer system, not the clubs’. Sadly, the likes of Stockport County, Rochdale, or wherever it may happen to be, will be told that they must revise their IT system because they have to give the regulator the answers and the computer says no.
The compliance costs fall very heavily on the smaller organisations. They are not proportionate, and we should be honest about that.
Lord Jackson of Peterborough (Con)
I support the amendment that was so ably moved by my noble friend Lord Moynihan and added to by my noble friend Lord Hayward. The amendment is an easy win for the Government, because I cannot understand the rationale for any Administration not seeking to understand the ramifications of their own legislation in terms of the costs of a regulator and other associated costs within six months. Therefore, if the Minister is so minded, she might look more benignly and favourably on this amendment when we come to Report, because it makes sense.
The kernel of this amendment is a fundamental question. It is not a question of whether we trust the Government, because I think, in good faith, that the Minister no doubt truly and sincerely believes that her Administration will preside over a regulator with a light-touch regime. Unfortunately, for those of us who are more cynical, the history of regulators is that they expand. We go back to our old friend that I referenced some weeks ago, Parkinson’s law. It is not named in honour of my absent friend, who is sunning himself in the warmer climes of the West Indies as we labour in the salt mines of the upper House of our bicameral Parliament. No—not Stephen Parkinson, my noble friend Lord Parkinson of Whitley Bay, but Parkinson’s law enunciated in 1955, which is that the number of workers in public administration, bureaucracy and officialdom tends to grow irrespective of the amount of work to be done. That is a very important point.
I commend to noble Lords an excellent report by Policy Exchange, The Rise of the Regulators, which looks at the different philosophical underpinnings and reasons for regulators. It makes the point:
“Once in place, regulations create constituencies that benefit from their continued existence, perhaps because they shield them from competition, or help protect their market position. And those coalitions of interest are better placed and have stronger incentives to act in their own interest than the wider community is to act in theirs and”,
to
“secure an optimal group outcome”.
It notes that, in the 1970s, Professor George Stigler developed the concept that
“regulation is acquired by the industry and is designed and operated primarily for its benefit”.
We know that regulation is costly to British industry. The report says that the Federation of Small Businesses estimates
“the cost of regulation to the SME community in Britain to be £55 billion per year, or £10,080 per business; 88% of its member companies identified some aspect of the regulatory apparatus as a barrier to their operations”.
Furthermore,
“an imbalance of power or an insoluble divergence in interests requires the state to manage the relationship between individuals or groups of individuals by regulating behaviour. But the expanding regulatory bureaucracy is the policy instantiation of a more omnicompetent state—one which plays a larger role in the lives of citizens, and which therefore reduces the scope for freedom and personal initiative”.
Baroness Evans of Bowes Park (Con)
My noble friend makes a good point, and I am sure he has seen the comments by Mark Ives, the general manager of the National League, who said that it is worried that the Bill will be onerous. Some National League clubs work with two or three people and some volunteers. As he rightly says, these are the clubs most worried about the cost of compliance. I know that the Minister has talked about proportionate regulation but, for all of us, and as Mark Ives rightly pointed out, this is a serious concern for those clubs in the National League, the very ones that we want to protect and support.
Lord Jackson of Peterborough (Con)
As usual, my noble friend makes a sensible and accurate point. There is a big difference between a club such as Arsenal, which has several hundred full-time employees, and a club such as Ebbsfleet, which I think has five. The problem is that one will have a gap between pulling down the Premier League clubs by damaging investment and pulling up other leagues, which are going to aspire to the best in terms of professional support but will not have the resources so to do. That is the difficulty that the Bill imposes on those clubs.
It will be a big question as to whether the clubs in the smaller leagues will be able to afford the new compliance, risk and legal officers who will be, of necessity, required to comply with the responsibilities outlined in the Bill. The Minister has repeated time and again that the aim of the Bill is to improve the financial sustainability of football clubs. Yet, the Government’s solution is to slap these clubs with more costs. The shadow regulator should have been invited to the meeting because if the strategic objective of the Government is to drive growth, this is the wrong way of doing it. I am mindful of the time.
Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)
With respect, I draw the noble Lord’s attention to the time.
Lord Jackson of Peterborough (Con)
I know we have had a busy and eventful seven weeks and we are almost there, if the noble Baroness will allow me just to finish. The Employment Rights Bill is coming down the line, which will be an extra cost to businesses of perhaps up to £5 billion a year. These are all issues that the Government have not taken into account. It is absolutely right and proper for us to make the reasonable request for the Government to look at the impact in the real world of these compliance costs, and I hope that the Minister is able to come forward with better news when we get to Report.
Lord Pannick (CB)
My Lords, the noble Lord, Lord Moynihan, and other noble Lords have made a powerful presentation of concern, which I understand, about the financial costs of regulation. It is a short point. It really is. The question is whether the amendment is a sensible way in which to address this matter. I suggest that if there is to be a review of the financial impact on regulated clubs of complying with the provisions of the Act, the best people to conduct that review are the clubs themselves and the leagues to which they belong. They can collate the material, assess the costs and provide a report to the Government, which they can publish. Everybody will be able to debate it. It is all transparent. There is absolutely no need, so far as I can see, to have a specific provision in the Bill that addresses this matter.
Baroness Fox of Buckley (Non-Afl)
My Lords, there stands a contribution that does not know how tedious, time-consuming and expensive it is to write reports. Now we are putting on the same people, whom we have just said are going to be drowning in bureaucracy, another report for which they have to compile all the information and write. That was my view.
Although that is a simple point, it should be in the Bill because it is an underestimated threat of the Bill. I have no doubt that the Minister and the Government do not intend—
Lord Bassam of Brighton (Lab)
I made this point at an earlier part of our considerations. Put simply, all these clubs are limited companies and are regulated effectively through an audit process, so all of the financial information that will be required will be accumulated as a process and a product of their annual audit. I do not see that as excessive.
Baroness Fox of Buckley (Non-Afl)
I will carry on and make my point and we will see whether we can agree. I am concerned about it being excessive, but if it is not, this proposed new clause will prove the noble Lord right and me wrong, and that would be fine.
I wanted to start with the way that fans have really gone along with the Bill because they see it as something that will save smaller clubs and keep them from going under. Everybody knows about Bury and other clubs such as Chester City, Hereford United and Halifax Town. One of the most compelling things about the need for the regulator and the Bill is this notion that we will be able to save unsustainable, smaller clubs from going under. That is what gives it its moral force. People can rail against the big bad Premier League in some ways, and I understand that the Premier League, with its fans in the Chamber, is all we have talked about. I am glad that in this amendment we have started to talk about those smaller, poorer clubs, because I am worried that they will suffer as a consequence of the Bill. The noble Lord, Lord Hayward, explained that very well, and I just want to just tease that out a little more.
It is not just about operational costs in terms of compliance in a direct financial way. It is also the amount of energy and time that is going to be taken to comply by these very poorly staffed clubs, which have, say, two full-time members of staff plus volunteers. We know that time is money. I remind your Lordships of the speeches that we heard earlier on in Committee. The noble Lord, Lord Moynihan, made an excellent one about what it takes to write a corporate governance plan. I try to illustrate what it means to comply with equality, diversity and inclusion policies—forget any ideological disagreement on that. It costs time and money. By the way, to fulfil the EDI plans, you have to send all your staff on training. For example, the Civil Service at the moment spends 1 million days of Civil Service time on its civil servants going on EDI training. That is an indirect cost. The paperwork needed to keep this regulator happy—by the way, under the terrifying threat that you could lose your licence if there is non-compliance—really needs to be taken into consideration. It is not just money; it saps creativity and life out of the club, which in a way is a slightly different cost.
Recently, David Riley, who has moved from his role as legal director at the Competition and Markets Authority to become head of legal at the IFR, posted the following, rather boastfully, on LinkedIn:
“The first job is to recruit a team of lawyers to work within the shadow regulator as the legislation progresses. These lawyers will play a central role in shaping the IFR legal function, and working with others to help the IFR prepare to deliver on its statutory objectives”.
I read that out to a group of football fans, who said, “Oh my God, that sounds terrifying! Imagine if you’re running a small football club”. If you are a smaller, cash-strapped club hearing this, it is immediately about lawyers policing your work. You have no in-house experience to cope, so you think you had better bring in experts, consultants and third-party bodies. Again, that can lead to eye-watering costs, let alone your independence being undermined. I am concerned about that.
I will quickly take a step back, because sometimes we can get trapped in the specifics of football and all the passions and emotions associated with the game. I remind the Committee that one reason why so many of us are worried about this Bill is because of examples of other regulators created by legislation leading to damaging unintended consequences.
In terms of proportionality, a few weeks ago the tech journalist and academic John Naughton wrote an article in the Guardian bemoaning the terrible toll that the Online Safety Act and its heavy-handed regulator Ofcom were having on smaller, community-driven online forums, even though the Act’s stated aim was to target big tech and harms. I never really agreed with the censorious assault on big tech anyway but, as I argued with the noble Lord, Lord Parkinson, when he was on the other side and taking the Bill through the House—just to show that I am not sectarian—there is always a danger that compliance costs associated with any regulator, in that instance with the Online Safety Act, will make it untenable for smaller platforms to bear the brunt of the law. As John Naughton explains, that is what is happening as we speak, leading to the potential closure of forums with benign purposes—his examples were those discussing cycling and cancer care.
Lord Birt (CB)
My Lords, I started the evening feeling extremely cheerful, but I do not feel as cheerful now as I did earlier. As so often in the past, the analysis by the noble Lord, Lord Moynihan, was very pungent.
Unlike many who have spoken, I am a strong believer in regulation. I do not think that there is anybody else in this Chamber who spent many decades, the whole of their career, in the way I did. We are talking about how successful British football is. I worked in another world-beating part of Britain, its broadcasting system, plainly over many decades simply the best in the world and a regulatory achievement of all Governments over the best part of a century. So I am a very strong believer in regulation. My doubt is whether the scale of regulation that is imposed in this Bill is remotely appropriate. I worked in a world of highly effective but light-touch regulation and I am sorry to say that this whole dialogue illuminates the fact that we are in danger of creating a system which is overcomplex and bureaucratic and will stifle a highly energetic and brilliantly successful part of the British economy.
We need something that is highly effective but much more light-touch than this sounds at the moment. Yes, cost is important, and all those who emphasise the impact on small clubs are quite right to do so, but beyond cost is the impact that over-stifling regulation could have on the system as a whole. We have debated real issues this evening. We debated the quantum of flow down the leagues. The noble Baroness, Lady Brady, made an impassioned and very compelling speech about parachute payments. The noble Lord, Lord Bassam, rightly emphasises solidarity. These are testing issues that need resolution. Of course, the quality of governance is much easier. It is about the world of compliance and financial prudence, which is a very important part of the Bill and can be done with a relatively light touch.
We have to get it down to something simpler and more effective. I come back to what I said earlier: the “state of the game” report should be analytically powerful and help to balance. I used the word “balance” earlier and balance is the right approach here on all these complex trade-offs. The last thing we need is binary: we do not need two proposals on the table and you choose one rather than the other on the toss of a coin. That is the quite wrong way to resolve the kinds of issues that have come up during the course of the evening. It is about getting the right people in the room, with the right kind of support, bound to come up with a solution.
So the Government need to think a bit harder about proportionate regulation. I say that not as somebody who is opposed to regulation but as somebody who strongly believes in it and has benefited from it through the whole of his career.
Lord Pannick (CB)
The noble Lord makes a thoughtful and instructive speech. Is he saying from his BBC and other broadcasting experience that light-touch regulation can be achieved by legislative provisions, or is it a matter of attitude? What is it?
Lord Birt (CB)
It is a matter of creating the right institutions. In the golden days of ITV and Channel 4, it was the IBA—a relatively small but highly effective organisation. The noble Lord does not want a long speech from me about what it achieved as an organisation, but it was extraordinary. Obviously, the BBC has had 100 years as the most successful broadcaster in the whole world. The light-touch governance through BBC governors was powerful and impactful and it worked.
I am not suggesting that you just import those models, but we need something that is not stifling and bureaucratic, in a dynamic environment where people can get round the table and sort out these issues.
Baroness Taylor of Bolton (Lab)
My Lords, I just want to pick up on some of the points made. It is right that we need a proportionate system and we have to be careful in what we do. But we cannot afford to be complacent about the state of British football today. Yes, the Premier League is doing very well at the moment, but we have to acknowledge the difficulties of many other clubs and the serious need for some change in the way in which many football clubs are run.
A report published on Monday this week from Professor Nick Lord and lecturer Peter Duncan in the department of criminology at the University of Manchester shows some of the dangers that Premier League clubs could face if we do not get the right financial structure, and how certain clubs could be, because of the complexity of their ownership, vulnerable to their funds being used for illicit purposes. I mention that because we do need regulation and we cannot be complacent and pretend that all is well even in the Premier League.
Lord Markham (Con)
I rise to speak to Amendment 329 in my name and that of my noble friend Lord Parkinson. I will speak very briefly, because Amendment 327, on costs, was spoken to extensively.
I think we all accept the need for a regulator. The points about broadcasting made by the noble Lord, Lord Birt, were points I am very familiar with as a former director of ITV and were very well made. On proportionality, we have talked a lot about Premier League clubs, but I would argue that when you have National League clubs who have two, three or four members of staff and an impact assessment that says they will need one member of staff for compliance on this, that tells me that we have the balance wrong. We are saying that a third of their staff need to be in compliance.
I would like to answer the point made by the noble Lord, Lord Bassam, who said that clubs should already have all this information because they are doing an audit. An audit is backward-looking over the year that has happened. What the regulator is asking clubs to do here is to write a three-year business plan, which is forward-looking.
Lord Bassam of Brighton (Lab)
The regulator is also encouraging clubs to put things right and offer remedies in their reports that have to be fair and proportionate.
Lord Markham (Con)
I can bore on this issue, as a former FTSE chief financial officer. An audit is backward-looking, and you have to have a going concern statement, which is the forward 12 months. It is nothing like the business plan requirements that the regulator is asking clubs to provide for three years going forward. There is no doubt that that will require clubs to employ consultants, accountants—you name it—so it will be a significant burden on them, and this is exactly the point we should be considering. When you think about it, if you are talking about one member of staff per national—
Baroness Taylor of Bolton (Lab)
The noble Lord is almost suggesting that clubs of whatever size should not have a business plan. One of the things we want to encourage and develop is sustainability. There has been complacency among many clubs at different levels, such that they have not made proper forward-looking plans. I do not think it is a burden on them to do so at the appropriate level and proportionately, as we were saying earlier, but it would help the sustainability of all football clubs if they were to look forward in that way.
Lord Markham (Con)
Speaking as a fully signed-up member of the anorak club, I completely understand the point about business plans, which I have always done in businesses I am involved in. I am talking about the reality of football clubs. There is no way I am going to argue that having a business plan is not sensible, but at the same time, suddenly putting business plan requirements on a club with a turnover of a couple of million and two or three members of staff is an expensive exercise. That is the context in which I am making this point, and it is why I think Amendment 327 is sensible. It would make sure that everything is set out, so that we go into this with our eyes fully open to the burdens and what we are expecting clubs to do.
Lord Jackson of Peterborough (Con)
My noble friend is making a powerful case. Will there not be a displacement activity element to this, in that all the money and resources you are deploying on compliance you are not, for instance, concentrating on women’s and girls’ football or new football academies and other outreach programmes? Because you have this heavy-handed encumbrance of compliance, you are not going to be able to deliver the initiatives in grass-roots football that you would otherwise deliver, particularly in the lower leagues.
Lord Markham (Con)
Obviously it would be for clubs to decide where they will resource that from, but it will come out of the resources they have. If it is one person for National League clubs—the impact assessment assumes that it will be five people for Premier League clubs—and you put that all together, you are talking about a staff of at least 500 involved in all these compliance activities. It was also said that the regulator will have some 250 members of staff. So, you will have 700 to 800 people working in the compliance domain, and that has to come out of the pot that is football today. That is a very relevant issue. I agree on the needs of the regulator, and I agree that business plans are always a good thing, but there is a certain proportionality here that we need to be mindful of.
I am mindful of the time, so I will move on to Amendment 329, in my name and that of my noble friend Lord Parkinson. It is consequential to an earlier amendment we tabled, Amendment 19, which sought to put the leagues under scope in the Bill. This amendment would simply ensure that the regulations that may be made by the Secretary of State to amend the competitions under scope would be subject to the affirmative procedure.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Moynihan, for opening the debate on this group and moving the amendment in the name of the noble Lord, Lord Maude of Horsham; and the noble Lord, Lord Markham, for speaking to the amendment in the name of the noble Lord, Lord Parkinson of Whitley Bay, which he signed. I have to say that, at points during the debate, I wished that I was in the Caribbean, but I will endeavour to respond.
The Government recognise the intent behind Amendment 327, in the name of the noble Lord, Lord Maude. I thank the noble Lord, Lord Pannick, for cutting to the chase on what has been a longer debate on two amendments than I anticipated. They raise reasonable concerns that need to be addressed, but we have debated these concerns at some length previously. However, the exchange on what light-touch regulation might mean was useful.
It is vital that the regulator be transparent about the burden that its regulatory activities may have on clubs, so that it can be held accountable. From the start, we have been very clear that we wish to establish a regulator for football that will take a proportionate approach across all its regulatory activities. My noble friend Lady Taylor spoke about proportionate regulation. I thank her for highlighting the research that she shared with me earlier this week. She made many points better than I could.
We do not wish to bring into being a regulator that will impose unnecessary, onerous and burdensome requirements on clubs, and neither did the previous Government. That is in no one’s interest. Noble Lords have spoken of concerns about smaller clubs in particular. I am concerned that this debate may lead to some of those clubs being unduly alarmed. If clubs have raised concerns with noble Lords, please encourage them to contact the department, where we are very happy to discuss in more detail any concerns that they may have.
The noble Lord, Lord Addington, asked how the Government see scrutiny playing out in practice. We already expect that the impact of the regulator on the market, including on regulated clubs and the leagues, will be reviewed in the regulator’s “state of the game” report and its annual report. The Secretary of State and Parliament will be able to scrutinise these reports. This ongoing accountability is more appropriate than a one-time review by the Secretary of State, six months after the Act is passed, not least because, as was highlighted during the debate, six months would be an unfairly short window in which to appraise the impacts of a brand new, novel regulatory regime.
The noble Lord, Lord Moynihan, made a number of points and cited the impact assessment. The costs in the impact assessment have been estimated using evidence gathered through industry engagement and from existing regulators, ONS datasets and other sources of information. The impact assessment has been prepared in the same way as all government assessments, in line with principles in the Green Book. It received a green rating from the Regulatory Policy Committee.
Ultimately, the costs in the impact assessment are indicative. It will be for the regulator to finalise its operating budget, which will be subject to scrutiny from Parliament and government to ensure it represents value for money. The estimated costs have been informed by approaches taken by similar regulators and reflect the complexity of the activities required to oversee a new legislative and regulatory regime.
The noble Lord, Lord Hayward, cited a headcount of 250 staff for the regulator, which is not one that we recognise. Indeed, it is well above the level that we would expect. I will have to pick that up with the noble Lord afterwards to establish how that figure was arrived at.
Lord Hayward (Con)
It was the indicative figure given by the previous Secretary of State under our Government.
Baroness Twycross (Lab)
That is a helpful clarification. The figure remains one that I do not recognise. I will go away and cross-reference with officials why I have now been told that it is not one that we recognise and is above the level we expect. I know I have committed to come back to noble Lords with a number of costs, and we can clarify that at the same point before Report.
I understand that Amendment 329 in the name of the noble Lord, Lord Parkinson, is a natural consequence of the noble Lord’s Amendment 19 in relation to the specified competitions, and it certainly would have made more sense to debate it then. Nevertheless, as we discussed at length previously, we understand the desire to have upfront clarity in the Bill as to which competitions will initially be in scope of the regulator’s regime.
However, as I explained during our previous debates on this issue, the Government believe the approach taken to defining the scope of the regime in the Bill is the right one. It delivers the effect intended, closing any loopholes that would allow avoidance of the regime, while also allowing for agility to respond to any potential changes in the structure of the football pyramid.
On the merits of Amendment 329, we completely agree that the Secretary of State’s power to define the competitions in scope and to amend this scope in the future should be subject to the affirmative parliamentary procedure. This will ensure that Parliament can scrutinise this important decision properly. That is why the Bill as currently drafted achieves this already in Clause 91(3)(a)(i). However, as we cannot accept the noble Lord’s Amendment 19, which was withdrawn, we cannot accept this consequential Amendment 329 either.
For the reasons I have set out, I hope the noble Lords will not press the amendments.
Lord Moynihan (Con)
I am very grateful to noble Lords who have participated in this debate. I think it has been one of the best debates we have had in Committee. I particularly highlight the contribution made by the noble Lord, Lord Birt, which is very relevant to the amendment. There is a huge difference in costs between light-touch regulation that is effective and appropriate and what he has identified in the 125 pages of this overcomplex and bureaucratic legislation —let alone the secondary legislation that will flow from it. If it becomes overcomplex and bureaucratic, it becomes expensive.
To get that balance right, which was an important point made by the noble Baroness, Lady Taylor, we need regulation. But football is regulated. The FA is the core regulator of both professional and amateur football in England. It has been absolutely absent from this debate. It has said nothing, to the detriment of its reputation as the national governing body of football in England. It is very sad that it has had nothing to say and no opinion. It is there to protect the autonomy of football and really should have come to the table and provided us with its thoughts. Indeed, I know that some noble Lords have written to the FA to ask it for a briefing on the Bill, and the FA’s response has been that it does not have a view on the Bill. We have no briefing. That is exceptionally sad.
Lord Pannick (CB)
Does that not tell the Committee something about the lamentable quality of regulation that the FA currently provides?
Lord Moynihan (Con)
Without a shadow of a doubt. My criticism is of the FA and its inability to be the core regulator for a professional sport. Indeed, in an earlier intervention this evening, the noble Lord, Lord Pannick, alluded to the fact that we need this Bill because we need a regulator to oversee solutions that would occur. I would have intervened on him, if I had not been eagerly awaiting the ministerial response, to point out that the FA should have been first and foremost in that role. It is sad and regrettable that it has not been.
I will briefly touch on other points that have been made. Of course, for the senior clubs in the Premier League this will be a burden, but less of a burden proportionate to the clubs that the noble Lord, Lord Bassam, and I are worried about in terms of cost. UEFA compliance is onerous, for example, and much of the compliance that UEFA imposes on clubs will need to be replicated. Clubs will need to look at it carefully to see whether there is overlap. My principal concern has been one shared with the noble Lord, Lord Bassam, at an earlier stage in this Committee: how much is this going to cost?
The amendment purely looks to try to resolve that question. There is an argument that it would not need to come before Parliament but can simply be published by the regulator, drawing on information from clubs. Indeed, the regulator will have to do that, but given the huge scope in potential cost that ranges from light-touch regulation to invasive regulation, along with the length of the Bill and the associated costs, it is appropriate that Parliament reviews that. Whether that is after six months or longer—as the noble Baroness, Lady Taylor, said—either way it is important. It is a one-off opportunity. After that, we will have the regulator reporting and the relevant reports coming towards Parliament.
The Minister, who has worked exceptionally hard and could not have been more helpful to Members of the Committee at all stages, said, having been handed a note from her Box—that has not been too frequent, which is to her credit as throughout this Committee she has relied very little on the Box for additional information—that the impact assessment has been based on similar regulators. There is no similar regulator in the world of sport, let alone the world of football. It is simply not possible to do that. The impact assessment is the reason I am so worried about the costs. It says:
“The proposed intervention is a bespoke, sophisticated and evidenced-based regulatory framework”.
The noble Lord, Lord Pannick, will recognise that phrase. That is exactly the quality of advocacy I would expect from him on any occasion—bespoke, sophisticated and evidence-based—but I might suggest that it does not come particularly lightly on the purse.
As a result, the costs associated with having that regulatory regime might be very considerable, especially when the very same paragraph states that the regulator, in the view of the Government,
“will be legally prohibited from intervening in football … or commercial … activities, thus limiting the potential risk of deterring investment”.
That is exactly the opposite of what the Bill sets out to achieve. Therefore, if these figures are based on that statement, they are erroneous and illusionary. They are fanciful pipe dreams. We really need an opportunity, therefore, to review the costs of regulation for all clubs six months after the Bill has been enacted. It would be very helpful to Parliament to see what those costs are at that stage and to reflect on them. For the time being, at least, I beg leave to withdraw.
Baroness Twycross
Member’s explanatory statement
This amendment corrects an erroneous cross-reference.
Lord Markham
Lord Markham (Con)
My Lords, I rise to move Amendment 336 and speak to my further amendments in this group. Those amendments are all taken together: indeed, Amendments 336, 338 and 339 are consequential to Amendment 337. Amendment 337 seeks that the Secretary of State must consult UEFA on the provisions and impacts of the Bill and confirm to Parliament that they have done so.
We will all recall that the issue of UEFA’s views on this Bill has cropped up on many occasions throughout Committee. That is not because we are chasing false leads but because there are very serious concerns, raised most notably by my noble friend Lady Brady, about whether UEFA is content with the Bill as it stands. The ramifications of its discontent, notably the disqualification of English teams and clubs from European competitions such as the Euros, are severe. I am sure that the Minister, or indeed the Prime Minister, would not want that on their conscience.
Of course, we do not fully know whether UEFA is discontented or in fact perfectly happy, because the Government still have not published the letter from UEFA to the Secretary of State. Indeed, the Minister has still not responded to the letter sent to her by my noble friend Lady Brady on this issue. While aspects of UEFA’s letter have been seen by news outlets—Sky and the Times have reported on some of its contents—the full views of UEFA have still not been made public. The only sources that noble Lords, and indeed the public, have been able to see to understand UEFA’s opinions are those we have seen in the news stories. This is highly concerning. From those news outlets, we know that the Minister’s comments that UEFA is happy with the Bill do not show the whole picture. Sky news reported in September last year that the letter from UEFA to the Secretary of State said there should be
“no government interference in the running of football”.
As I said earlier, it is disappointing that I am only able to quote that one line, which I found in the Sky news report.
What this demonstrates is that UEFA appears to still have concerns with this version of the Bill. The Government have indicated that their removal of the foreign and trade policy provisions has placated UEFA and that UEFA has no concerns at all about the financial regulations included in the Bill. I would like to be reassured that this is the case, but, alas, I have not heard anything that indicates this. That is why our Amendment 337 is so important. It would explicitly require the Secretary of State to consult UEFA on the provisions of the Bill and confirm that it does not have concerns before the Bill can come into effect. This will have to be confirmed to Parliament so that we are fully satisfied that there is no risk of our clubs being disqualified from the Euros or the Champions League.
Lord Pannick (CB)
I support the noble Lord, Lord Markham, on this. I find it quite extraordinary that the governing body of European football has written a letter to the Government relating to this legislation and yet we are not able as a Committee to see it and form a view. It is not my understanding that UEFA has specifically asked that the letter remain confidential. Indeed, it would be a very surprising attitude for the governing body of European football to take. We have discussed this on a previous Committee day, but I did not think we received a very satisfactory response. Could the Minister tell us whether UEFA has asked for its letter to remain confidential and, if not, why we cannot see it?
Lord Watson of Invergowrie (Lab)
My Lords, with all due respect to the noble Lords, Lord Pannick and Lord Markham, is it not rather disingenuous to suggest that UEFA might have some concerns with this legislation but is not willing to make them public? UEFA is not known for being shy and slow in coming forward when it is concerned about any aspect of football in any of its member countries, so I think we can be fairly certain that, if it had serious concerns—or indeed, any concerns—it would have made them public and we would know about them.
Lord Addington (LD)
My Lords, I find myself agreeing with both the noble Lords, Lord Watson and Lord Pannick. It would be good if we could know what has been said and, if there is no big objection, we could move on. It was suggested that we had to comply with UEFA’s rulings in our own law. That is patently absurd. But, if there is no problem, let us know about it. We have not been told that English clubs will be banned if this goes ahead, so presumably it is not that big a deal. Surely, finding out about it now would be sensible.
Lord Jackson of Peterborough (Con)
My Lords, I support the noble Lord, Lord Markham, and express my concern about the non-appearance of this letter. We have been debating whether there is a letter or what the letter says. We have been speculating on what it might or might not say for several weeks and several sessions of this Committee.
I have carefully read the Written Answer that the noble Baroness gave my noble friend Lord Moynihan on 8 January. She does not, interestingly, pray in aid any Cabinet Office guidance or recommendations on the release of so-called private correspondence that forms a part of government policy formation. She just says that
“it would not be appropriate to publish private correspondence with any stakeholders in the Library of the House”.
If it were an individual divulging personal information in the course of their letter to a Minister or a government department, that would be a separate issue. Noble Lords will be aware that, for instance, freedom of information is quite circumscribed as to what can be released in terms of impinging on someone’s privacy, or if it would interfere with an ongoing judicial case. This is not the case. This is not a private letter; this is a letter from a corporate representative body. It may not be a government body or a non-departmental agency in the UK, but it is a representative body of some standing with a rulebook which governs the practice of football in our country.
On that basis, at the very least it is incumbent on the Government to produce that letter. If we have overegged the pudding and, in respect of the backstop, UEFA has no qualms or serious misgivings about this legislation as a whole, and particularly the backstop, I for one am happy to be disabused of my cynicism. In the meantime, we, the media, noble Lords and others in the other place when this goes there will be suspicious unless that letter is produced.
So I respectfully implore the Minister to think again and place that letter in the Library of both Houses so that we can inform a proper debate on specific issues that are germane to this Bill: in other words, the attitude of an important and prestigious organisation such as UEFA.
Lord Moynihan (Con)
My Lords, an exceptionally important point was made about UEFA not being shy in coming forward. Indeed, we know that, as a result of UEFA representations, the Bill in its original form was changed. If it had such an influence, it is not unreasonable to ask to see a copy of the letter, which is clearly far beyond private correspondence. It is of public interest.
I return to the question that I put on 19 December, when I asked whether it was the Government’s intention
“to seek assurances from UEFA that the introduction of backstop powers to the proposed Football Regulator does not impact on the autonomy and independence of football’s governance as required by UEFA.”
The response was interesting:
“As set out during the House of Lords Committee Stage debate on 18 December, UEFA raised no concerns about the backstop in its most recent meetings with DCMS and the Minister for Sport”.
It does not refer to the letter. Therefore, can the Minister kindly confirm to the Committee this evening that there was no reference to the backstop in the UEFA correspondence? This was of such significance that, in its first introduction into the Committee proceedings, the Minister’s response to the Committee was that publishing the debate around the letter would worry the facts. That was the position. It was not the letter: it was the debate we were having around the letter.
I have just one very simple question, and then I will be much relieved if the answer is as I assume it will be, in the light of the answer given by the noble Baroness, Lady Twycross: that
“UEFA raised no concerns about the backstop in its most recent meetings with DCMS and the Minister of Sport.”
Can the Minister confirm that it did not raise the backstop in the correspondence it had with the DCMS, or raise any concerns referring to the backstop?
Baroness Blake of Leeds (Lab)
My Lords, I will start by responding to the amendments put down in the name of the noble Lord, Lord Markham, in this group, and I would like to thank him accordingly. We have not spent a great deal of time talking about some of the implications of the amendments, so I would just like to draw attention to those. The reason we will not be supporting Amendment 336 and the others in this group is that the changes put forward would severely hinder the setting up of the regulator and its ability to achieve its objectives as soon as possible after Royal Assent.
I emphasise again that my noble friend the Minister has stated that the Government have worked closely with and consulted with UEFA, FIFA and the FA throughout the development of this Bill and will continue to work with them as it progresses through Parliament, as indeed will the regulator once it is legally established, including through the FA’s observer role on the regulator’s board. This will ensure that no powers or potential actions taken by the regulator would be in breach of its own rules.
All I can say tonight is that we have debated this issue extensively on a number of occasions, and as my noble friend the Minister has set out previously, we are working with the relevant authorities to give noble Lords the reassurance they seek on the specific concerns regarding UEFA and FIFA statutes, ahead of Report. My response to the repeated requests about the letter has to be, again, that it is private correspondence and the Government do not share private correspondence with international organisations.
Lord Pannick (CB)
The noble Baroness asserts that it is private. Have the Government asked UEFA whether it has any objection to sharing this letter with the rest of us?
Baroness Blake of Leeds (Lab)
I cannot respond to that point, so apologies for that.
Lord Pannick (CB)
Will the Minister write to me and put the letter in the Library?
Baroness Blake of Leeds (Lab)
I shall certainly take away the noble Lord’s comments, and I repeat the response that I have had from the department in terms of the letter we have received.
Lord Moynihan (Con)
I am very grateful to the noble Baroness, Lady Blake. She knows that I admire her greatly, not least as a fellow Leeds supporter. The question is very simple. Would the Government be prepared to write to UEFA to ask its permission for the letter to be published?
Baroness Blake of Leeds (Lab)
All I can say, again, is that I shall certainly take that point back. I will not answer that point at the Dispatch Box tonight, but the views have been made very clearly by Members in the Chamber.
I shall move on to the other amendments. If the Secretary of State does not have the flexibility required to determine what the regulator’s powers are when they are commenced, this could lead to delays, confusion and inefficiency through the process of set-up.
The noble Lord, Lord Markham, has referred quite a few times to unintended consequences, which is something the amendments in his name could well lead to. As we all know, the commencement of legislation is a crucial and in many ways delicate process, and it will require careful co-ordination between the department and the regulator to ensure that the provisions are switched on at all times. With those changes, the regulator would likely not be able to make any progress at all with the set-up. Similarly, the delays that this change would cause would be likely to have an impact on areas such as the “state of the game” report, a necessary and vital report that the regulator will need to carry out as soon as possible.
Furthermore, we would have all the regulator’s staff on taxpayers’ money at this point, given that the levy would not yet be up and running, so they would be unable to work. That would mean that a longer period would have to be funded by the taxpayer, until it was recouped. I am sure that the noble Lord agrees that that would not be good use of money. For the reasons I have laid out, I am unable to accept the noble Lord’s amendments, and I hope that he can withdraw his lead amendment.
Lord Markham (Con)
I thank noble Lords for their contributions, and I thank the Minister. I think there was a shared view, bar the Minister, that there is an opportunity here to clear this up. It has been going on all the way through, and I must admit that, the more ducking and diving, obfuscation and avoidance there is, the more suspicious I become. We have a new reason today: for the first time, we are told that it is going to hamper the speed of setting up the regulator. The last time I looked, having a meeting with someone takes half a day or a day. It is going to cost a lot more to set it up. I am afraid that that just does not add up. Why do we not ask now? We do not need to wait until Royal Assent—why do we not show them what we are going to go through on Report? The Bill has not even gone through the Commons yet, so we could do this in parallel and it would not need to delay anything. I am sorry, but that does not really wash as a reason. That brings me back to the point that the only reason not to come clean about it all is that there is something they are trying to hide.
The other new reason is that the letter is private. The question rightly asked by the noble Lord, Lord Pannick, is whether we have asked UEFA whether it is private and whether it is willing to provide that letter. I feel sorry for the noble Baroness at this point, because maybe it was felt that this was one of the quieter parts of the Bill to take over from her fellow Minister. That was a bit of a hospital pass. But they do not even want to say whether they are willing to ask UEFA whether the letter is private. It is very clear: we can find out by asking whether UEFA does not want it to be published—that is a very quick question—or are the Government trying to stop it being published?
Lord Moynihan (Con)
I just make the point that the only reason we are pushing this so strongly is that if the regulation set by UEFA for European league and other competitions is at odds with what we are considering in this Committee with regard to the regulation that we are looking to put on the statute book, we will have a very real problem. We have the potential for English clubs not being able to participate in European competitions. That is why this is so important.
Lord Goddard of Stockport (LD)
Just to reply to that, let us be straight: is the noble Lord seriously alleging that the Government are holding back information that could exclude English football clubs from playing in Europe and the World Cup?
Lord Markham (Con)
I just think that this is very easy; it could be cleared up a minute. If there is nothing to hide and no concerns, just release the letter. Then we can say, “That’s fine; there are no concerns. Fantastic”. No one will be happier than all of us. What has been clear through all the Committee days is that we are all here, up to whatever hour at night, because we care about football. We are all football fans here; we have all declared our interests and our various season tickets because we care about football. That is why we are going on about this.
Lord Pannick (CB)
I just make it clear that I am not making any conspiracy allegations of any sort; I am simply and purely concerned, as I would be in other contexts, about basic transparency. There is a letter from a very important regulatory body in Europe and we are not allowed to see it. It is obviously relevant to the Bill that we, as the upper House, are discussing. Transparency demands, in my respectful submission, that we be allowed to see it—unless UEFA will not allow that.
Lord Markham (Con)
I thank the noble Lord. I think that the points are clear. We are clearly not going to get the resolution now. I think it will carry on as a running sore until the Government, I hope, put all our minds at rest. All the time that they do not, and all the time that they obfuscate, we will continue to be concerned because we know that, if UEFA is not happy, the consequences are, as my noble friend pointed out, pretty dire in terms of our clubs’ involvement in European competitions. I will withdraw my amendment at this stage, but I am sure that this will come back over and again.
Lord Markham
“(2A) The Secretary of State may only make regulations for Part 3 to come into effect at the end of a relevant football season.”Member’s explanatory statement
This amendment ensures the operating licensing regime does not come into effect during a football season.
Lord Markham (Con)
My Lords, I hope that this will be very simple and quick. All we are trying to do here is prevent the possibility of mid-season disruptions brought about by the implementation of the licensing regime. Clause 99 states that Part 3 will come into force on a day that the Secretary of State may by regulations appoint. The licensing regime therefore could be implemented at any date; there is no specification of when this should come into force. We want to ensure that, when the licensing regime is implemented, there should be as little disruption as possible.
The intention of this amendment, therefore, is to ensure that the Secretary of State cannot apply the licensing regime in the middle of a season. My concern is that the licensing requirements in Part 3 could be quite extensive. The information that clubs will have to provide to the regulator to obtain their licence is not only vast but, at this stage, quite unknown. Of course, the regulator will start to work on publishing its rules and requirements for the licensing regime, although we do not know when because the Bill does not include a timeline for the regulator to do so. However, I would hazard a guess that clubs will have to compile a large volume of information and documentation.
We know the requirements that are in the Bill at this stage. Clubs will have to submit a financial plan, a corporate governance statement, an annual declaration, and a personnel statement. They will have to ensure that they have the appropriate financial and non-financial resources, and meet the fan engagement threshold. If a club cannot comply with these requirements and therefore cannot obtain a licence—I am thinking of the smallest clubs in the National League, with just a few employees—then that club would have to cease operating teams in specific competitions.
If the regulations to implement the licences came in the middle of a season then a club could find itself in the position of having to drop out of the league half way through. The disruption that this could cause would obviously be enormous—not to mention the financial ramifications of such an event. By stating that the Secretary of State may implement operating licences only at the end of a football season, the potential for the disruption I have outlined would be significantly reduced. This safeguard is therefore required to ensure that the licensing regime, when it comes into force, causes less disruption than could otherwise be the case.
Lord Watson of Invergowrie (Lab)
The noble Lord may be surprised and not too pleased to hear that I support this amendment. It makes sense not to have in-season changes. This message needs to be got through to some Premier League clubs, including West Ham—I invite the noble Baroness, Lady Brady, to reply. Some clubs change their ticketing arrangements in the middle of a season, shutting out some fans—particularly children and seniors—from getting cut-priced tickets. This is apparently in pursuit of greater income. Manchester United are the main culprits. I understand that a group of fans from various clubs has come together to protest at these changes. It is wrong for this to happen in season, which is why it would be sensible for the Bill to incorporate an amendment similar to the one that the noble Lord, Lord Markham, has just moved.
Lord Addington (LD)
My Lords, I basically agree. There is a break at the end of the season. Most organised team sports change their rules and regulations in that break if they are going to do so. It might not need to be in the Bill, but it might be a Pepper v Hart type case; I say that timorously in view of the company I am keeping. If the Government can give us some indication that they will make major changes in the off-season, when players are exhausted and structural changes can be made—that is basically what it is for—then I would be happy because it is quite a sensible principle.
Baroness Blake of Leeds (Lab)
My Lords, I thank the noble Lord, Lord Markham, for tabling the amendment and other noble Lords for their comments. I will go through the reasons why we will not support the amendment. We understand that its intention is to avoid any burdens or disruptions for clubs that might be associated with mid-season licensing. This includes the risk, albeit remote, that licenses are refused mid-season.
However, the amendment would mean that the entirety of Part 3 could not be commenced until the off-season. For example, it could affect the ability of clubs to prepare and submit their applications early. If the regulator became operational mid-season, it could mean waiting for as long as eight or nine months before it could even begin to license clubs. We do not think this is right. Clubs should be able to prepare and, if they so wish, submit their applications early to avoid the regulator having to deal with a rush of 116 applications in the relatively short window between seasons.
Ultimately, if the Secretary of State does not have the flexibility required to determine when the regulator’s powers commence, it could lead to delays, confusion and inefficiency throughout the set-up process. We are, of course, prepared to continue the fruitful conversations we have already have and I look forward to more of them. Although I recognise the amendment’s helpful intent, I am unable to accept it. I hope that the noble Lord will withdraw it.
Lord Markham (Con)
I thank the noble Lords, Lord Watson and Lord Addington, for their support. I was hoping that the noble Baroness would say that this is just a very sensible, practical solution. I hope that the Ministers feel able to reflect on it at this stage, because it is a very practical step to make sure we can implement this correctly and not impact clubs mid-season. I am happy to withdraw at this stage.
Lord Goodman of Wycombe
“Duration and review(1) This Act expires at the end of the period of five years beginning with the day on which section 5 comes into force (“the initial period”), subject to the provisions of this section and section (Renewal and dissolution provisions).(2) The Secretary of State must establish an independent review panel (“the Panel”) no later than 15 months before the end of the initial period.(3) The Panel must—(a) carry out a review of—(i) the effectiveness of this Act, (ii) whether the IFR has remained within its statutory purposes, and(iii) whether the objectives of the Act could be achieved through less interventionist means,(b) prepare a report of the review, and(c) lay a copy of the report before Parliament, no later than 12 months before the end of the initial period.(4) The Panel must consist of—(a) at least one person with expertise in competition law,(b) at least one person with expertise in regulatory policy,(c) at least one person with expertise in football administration, and(d) at least one person with expertise in business regulation.(5) Where there is a change in the person holding the office of Secretary of State after the establishment of the Panel but before the report is laid before Parliament—(a) the new Secretary of State may by written notice dissolve the existing Panel,(b) where the Panel is dissolved under paragraph (a), the new Secretary of State must—(i) establish a new Panel within 28 days,(ii) ensure the new Panel meets the requirements of subsection (4), and(iii) extend the period for the laying of the report by up to three months if necessary to allow the new Panel to complete its work,(c) the new Panel may—(i) consider any work undertaken by the previous Panel,(ii) adopt any findings of the previous Panel that it considers appropriate, or(iii) conduct an entirely new review.(6) The new Secretary of State may only exercise the power under subsection (5) once in relation to the review required by subsection (3).(7) The report under subsection (3) must include—(a) an assessment of whether the IFR has—(i) achieved its objectives under section 6,(ii) remained within the scope of its original purposes as set out in section 1,(iii) avoided expanding its regulatory reach beyond its core functions,(iv) maintained proportionate intervention in the football industry,(b) an assessment of—(i) the regulatory burden imposed by the Act,(ii) the costs of compliance for regulated entities,(iii) whether the objectives could be achieved through less intrusive means,(c) an analysis of any instance where the IFR has—(i) exceeded its statutory powers,(ii) created additional regulatory requirements beyond those explicitly authorised by the Act,(iii) expanded its interpretation of its objectives beyond their original scope,(d) a specific assessment of whether market conditions still justify statutory regulation, and(e) a recommendation as to whether the Act should be—(i) allowed to expire,(ii) renewed for a further period with specific restrictions, or(iii) renewed without modification.”
Lord Goodman of Wycombe (Con)
My Lords, Amendments 341 and 342 have sunset provisions. I declare my interest as set out in the register as a senior fellow at Policy Exchange. I am mindful, of course, that this is the final debate on amendments this evening on this very substantial Bill of 100 clauses and 12 schedules, and we are near the end of seven sessions in Committee. I note what my noble friend Lord Moynihan said at the very start of these proceedings: it is rare for a Bill to have 340 amendments tabled even before it has commenced. I make the point in the presence of the Government Chief Whip that many of those amendments were tabled by the other side.
In that spirit of agreement, we can all agree that this is a very significant Bill. I am going to try to further that spirit and seek some consensus as I discuss these sunset provisions. We will see how I get on, mindful that in Committee it is unusual to push amendments to the vote but very usual to try to explore issues.
I begin by restating another view on which we surely all agree: as my noble friend Lady Brady has said many times, football is its own ecosystem with its own rules, governing bodies, leagues and codes of practice, into which the Government are about to appoint—as the previous Conservative Government wished to create before them—a new state-licensed regulator, without a licence from which teams in the pyramid will be unable to play in specified competitions. It is an arrangement of great interest to UEFA and FIFA; I will put it no higher than that at this point, following some of the debates we have had this evening.
I hope that it is also a statement of the obvious and not at all controversial to point out that regulators are in themselves controversial. On this side of the House, we tend to hear—as I have heard from my noble friends, and I am of course much of the same mind—that regulators are subject to mission creep and lobby capture. My noble friend Lord Jackson said earlier this evening that they are subject to Parkinson’s law.
I am not going to repeat those arguments because they have been exhausted at length, but I hope noble Lords will forgive me if I pray in aid someone who has recently made them quite forcefully. I am quoting from a BBC report. This person said that
“the regulators, the blockers and bureaucrats”
are part of “an alliance of naysayers”, which means that
“we can’t get things done in our country”.
The person who intervened in this way was of course no one less than the Prime Minister. I follow my noble friend Lord Hayward, who pointed out that it is disappointing to hear that the shadow regulator will not be included in the meeting with the Chancellor tomorrow. None the less, I was encouraged by what the Minister said about growth in her responses to an earlier debate. She will of course be aware that many of my noble friends have moved amendments seeking to put a growth objective in the Bill.
Regulators are also controversial, not only because in the view of some people they do too much and in the view of others they do too little. It is a frequent theme of noble Lords and of people in the other place that regulators do things in the wrong way. I defy any Member of this House to look at reports of committees of this House or the Public Accounts Committee into Ofwat, Ofgem, Ofcom and all these other regulators and assert that those committees are never critical of what those regulators do—they are often very critical indeed.
Consider the range and depth of the issues that the new regulator will be asked to consider. I will list 10 points that fans may possibly say after the regulator has come into existence and has bedded down for a while. Is it possible to imagine and believe that fans would say the following?
First, my club says it cannot buy the players it wants, or may have to sell players, because of the financial constraints the regulator has put in place.
Secondly, my club claims it cannot afford the levy and will have to sell players or raise ticket prices.
Thirdly, my club says it cannot afford the interest on unpaid levies and, again, it will have to sell players or raise ticket prices.
Fourthly—this is a theme that has come up a lot in these debates—the regulator will not let my club spend to get promoted as so many clubs have before.
Fifthly, the regulator has taken my club’s parachute payments into account in its calculations, but not the parachute payments of our local derby rivals. If that circumstance arises, I cannot imagine that it will go down very well.
Sixthly, my club, which plays in the Football League, says it is not getting enough money from the Premier League.
Seventhly, my club, which is a Premier League club, says it is now being forced to distribute too much down the pyramid and this is financially unsustainable.
Eighthly, the regulator is doing far too much on DEI. Alternatively—do you know what?—the regulator is doing far too little on DEI; it should enforce these provisions more rigidly.
Ninthly, the regulator should push my club much harder on ticket price consultation.
Tenthly, and most obviously, the regulator is not consulting sufficiently on any of these provisions.
Those are just 10 points; I could go on, but I will not. I have not even mentioned the words “significant influence”, which have been such a feature of these debates. There is a whole series of questions that fans might raise.
The regulator might sometimes be right and might sometimes be wrong, but one of the questions that we have to ask—it has been circulated in today’s debate and was referred to by the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Addington, on his Front Bench—is about parliamentary scrutiny. How will the regulator sufficiently be scrutinised? How can he be held to account by Parliament? The question is especially pertinent because we do not know what the remit of the regulator will look like in a few years.
In these debates, it has been suggested that the remit of the regulator should be increased and widened to include: the two top leagues in women’s football, National Leagues North and South, bodies that negotiate TV rights, player welfare, fan safety, net zero, climate change, modern slavery—we had a very interesting debate about that—DEI more broadly, and corporate governance and practice. I put it to noble Lords that it is not impossible that, in the other place, the remit of the regulator may be extended—or it may be extended soon in future years—which makes these scrutiny concerns even more pressing.
Let us ask ourselves what scrutiny Parliament will be able to undertake on the regulator. There will be an annual report. There will be the “state of the game” report, which we have debated at considerable length. I suppose that the DCMS Committee in another place can haul the regulator in. None the less, there is what has been described as a “lacuna in scrutiny” in relation to regulators. That is a direct quote from a report called Who Watches the Watchdogs?, which the noble Baroness, Lady Taylor, will recognise because it was produced by her Industry and Regulators Select Committee, which weighed the merits and demerits of setting up a new structure.
I mentioned Policy Exchange earlier because of the report alluded to by my noble friend Lord Jackson, The Rise of the Regulators, written by my colleagues James Vitali and Zachary Marsh. It focuses on what it calls the “democratic deficit”. Although finding an answer to this problem of the democratic deficit is a bit beyond my pay grade, I put it to the Committee that the sunset clause that I am proposing would have the effect, as well as being a sunset clause, of increasing scrutiny in a way that would be helpful. The amendment proposes an independent panel that would, within 15 months of the regulator being established, review how the regulator is getting on. This independent panel would contain at least one person with experience of competition law, at least one person with experience in regulatory policy, at least one person with expertise in football administration and at least one person with expertise in business regulation. The panel would review the regulator and ask whether the regulator had acted, within the scope of the original provisions, proportionately and reasonably in relation to cases of compliance and the regulatory burden, and would examine whether its objectives could be achieved by less intrusive means. The panel would then recommend whether the regulator expires, works further for a period with restrictions, or simply goes ahead as it is doing when the panel meets, without any further restrictions.
I make no apology for pressing the merits of sunset clauses. It would be a good thing for all new regulations to be subject to them. I have to confess to the Committee that it is very unlikely that the panel I am suggesting would recommend that the regulator expire. I will tell you why. It is because the panel would be selected by the Secretary of State, who I am addressing through the person of the Minister on the Front Bench. It is most unlikely that the Secretary of State would appoint a panel that would abolish the regulator. Frankly, this is not a perfect provision, but I am seeking consensus and trying to find a proposal that the Government might not consider automatically repugnant.
One should note, in relation to this new panel and any recommendation that it would make, that Parliament would take the final decision. If the panel decided in its view that the regulator should continue, Parliament would have a say in the final decision. If the panel recommended that the regulator be scrapped altogether, it could not do that without the consent of Parliament. There is an extra layer of parliamentary scrutiny. I am grateful to the Minister for writing to Peers on this side of the House about a sunset clause last year. However, I say very briefly that her arguments against it were somewhat misconceived, because they were basically predicated on arguing that, for some reason, the leagues would have reason for acting in bad faith and frustrating the regulator.
I reject that for a number of reasons, not least because it would be the independent panel, with members appointed by the Secretary of State, that would make the final decision. If the panel thought that the clubs or the leagues were being unreasonable, it would side with the regulator, not the leagues. It is perhaps also worth pointing out in parentheses that the clubs, the leagues and so on are going to be under considerable legal obligation as a result of this Bill and would not want to chance their arm lightly.
The Minister also argues in her letter that the sunset clause would incentivise the regulator to look for short-term solutions to long-term problems. Again, I find that hard to see, because the panel making the judgment would want to find the solutions that were best for football. If the regulator were suddenly making short-term decisions at the expense of long-term ones, I should expect the panel to be very critical of that.
Finally, before I take my seat, I say that this is Committee and these are probing amendments. There is a good case for a sunset clause, but it may be that other Members of the House will have other ideas of how parliamentary scrutiny might be strengthened other than by a clause. If they have those ideas, it would be useful to hear them. With that thought in mind, I beg to move.
Lord Norton of Louth (Con)
My Lords, I must begin by correcting my noble friend earlier who said we are all football fans. I have no interest in football, but I do have an interest in the legislative process.
In 2004, the Constitution Committee of your Lordships’ House published its report on Parliament and the Legislative Process. I was chair of the committee and indeed the drafter of the report. We recommended changes to the legislative process, including the introduction of post-legislative review. We proposed that Acts be reviewed within three years of their commencement or six years following enactment, whichever was the sooner. In 2008, the Government accepted the case for post-legislative review, committing to Acts being reviewed by departments three to five years after enactment.
Baroness Taylor of Bolton (Lab)
My Lords, I am afraid that, although the hour is late, I cannot resist saying a few words about the suggestion that we should have a sunset clause. I am somewhat surprised that the noble Lord, Lord Goodman, has presented what is a very bureaucratic way of going about getting some accountability here, and I fear that the sunset clause would be an incentive for non-co-operation. The noble Lord, Lord Markham, said earlier that he thought that some people might wait until the regulator was in place before they did certain things. If we had the sunset clause, it would be an incentive for those who did not want this kind of regulation to drag their feet and not co-operate. So that is not a good way forward.
I was also interested in some of the comments on the commencement amendments, which would also bring about a delay. I note that the suggestion is that after, I think, three years and nine months we should have this kind of review that was being suggested. I noted the noble Baroness, Lady Brady, saying earlier that there should be a transition period of three years, so we would be judging it on nine months if all the opposition amendments on this were carried, and that is not really satisfactory.
The simple fact is that football needs the Bill, fans need the Bill and we need to get on with it as quickly as possible. We need to give the regulator the powers that he or she needs to carry out the work that needs doing. We talk about football being a pyramid, and it is. The Premier League needs the whole of that pyramid. I could quote certain players who have been on loan at Bolton Wanderers and who now are doing very well at Liverpool, such as Conor Bradley—I am sorry that my noble friend from Everton is looking at me askance. The English national team needs football to be healthy at all levels. If we do not have proper involvement and proper facilities at all levels it will suffer as well. We have talked about the FA not taking its responsibilities seriously in terms of football governance, but there is a dimension here about the English national football team. We have to make some headway and get some things moving as quickly as we can.
The noble Lord, Lord Goodman, also mentioned accountability. What the noble Lord, Lord Norton, said about post-legislative scrutiny was also interesting. I chaired the modernisation committee in the other House in 1997. One of its recommendations was that there should be more post-legislative scrutiny. Both pre-legislative and post-legislative scrutiny give power to Parliament to get things right and to monitor exactly what it is doing. I am all in favour of that, but it does not need to be in the Bill.
What we do need is a proper drumbeat of accountability of all regulators to Parliament. The noble Lord, Lord Goodman, mentioned the report that the committee I chaired published, Who Watches the Watchdogs? One of the things we said in that report is that it would be to the advantage of everyone—industries, regulators, Government Ministers and consumers—if there was a proper drumbeat of regulation. A third of all regulators have never been called before Parliament. Another third has been called only when there is a crisis. That is not proper accountability. We need Parliament to take its responsibilities seriously and ensure that all regulators, including new ones, are held accountable by Parliament. That is a valid point, but we do not need new amendments. We need new action on the part of Parliament.
We need this Bill; the Premier League needs this Bill. I mentioned the research from the University of Manchester. Ironically, in the long term, this Bill might help to protect all clubs, including those in the Premier League. I hope we can make progress. It should be Parliament that holds regulators to account, not extra dimensions such as have been suggested.
Lord Hannett of Everton (Lab)
My Lords, I will refer to the comment by the noble Lord, Lord Norton, about not everybody being interested in football. As a long-suffering Evertonian, sometimes that is not a bad place to be, especially having seen Everton’s results tonight —but there you go; there is another day. I say to the noble Baroness, Lady Brady, regarding David Moyes, who has now returned to his spiritual home, that I hope some of his success at West Ham will rub off on Everton.
I have listened on a number of occasions to this debate and to some of the contributions and the experience that has been expressed. However, I am with my noble friend Lady Taylor—this is a time to move on and to enact the Bill, because this is what football fans want. As a football fan—a season ticket holder at Everton—I was delighted that support for the Bill was in the manifestos of all the main parties. From some of the contributions, you could sometimes be confused that that was the case. As football fans say, this is an important Bill. Noble Lords have on occasions appeared to forget how we arrived at this position. The fan-led review was based not on hot air but on the genuine concerns of football fans. The fans and the future sustainability of our beloved national game must always be at the heart of the House of Lords.
Noble Lords’ amendments—there have been too many to comment on individually, so this is a general observation—would in effect ensure, even before the independent football regulator gets off the ground, that those who oppose it would be seen to be working to ensure its demise. We know there are people who hold strong views about regulation, but there are occasions for regulation and this is one of them.
It could be said that this is another way, on top of the attempts through other means, to kill the Bill—to kill the regulator by the back door. That is not what fans want. I speak to fans from many different clubs who have been waiting for the Bill to pass.
In conclusion, I thank the Ministers for the way they have had handled this debate over many weeks, not only with stamina but with attention to detail. That is extremely uplifting.
Lord Addington (LD)
My Lords, I too do not think that these amendments are necessary. I agree with the principles the noble Lord, Lord Norton, laid out—I think the whole Committee agrees with them—but we do not need the amendments. The Minister can correct me if I am wrong but we have the “state of the game” reports, which are built in to look at the structure and success of this. We have a better vehicle for looking at what goes on than we have ever had before. If we decide to get rid of it, do we go back to what we had? Do we go back to having all those small clubs saying, “Nobody’s checking that we’re selling our ground for a nice development of flats”—the first thing raised with me 30 years ago about what is wrong with certain types of people who buy football clubs. That sort of decision is not new.
We have a successful Premier League—all power to it—but we have to look at the other divisions and the rest of football. We have the opportunity to do that and I hope we carry on. When the Minister replies, we should hear what the Government would do if the “state of the game” report suddenly said that we have got it wrong somewhere. I hope we will hear that and that we will carry on, because the underlying problem that brought this Bill forward was one event that actually, oddly, preserved the Premier League. If we go forward with this, we need a series of reviews—I have already raised this. Who Watches the Watchdogs? and all the reports concern themes in Parliament, as does post-legislative review. If we can bring this in and we have a vehicle for delivering it, this Act might actually something of a beacon for how we can achieve it.
Baroness Fox of Buckley (Non-Afl)
My Lords, I challenge the approach of the noble Lord, Lord Hannett, to this by saying that I support the amendment. I object to the way this is posed as a fans’ piece of legislation, that the fans want it, and that anyone who does not support or has any reservations about the Bill is not thinking about the fans.
The Bill is based on Tracey Crouch’s original fan-led review but there is a danger of a sleight of hand. I know it sounds populist—and I am keen on populism—to say that this is all about the fans. Actually, it was based on 20,000 online responses, so it is not necessarily all fans. There are fans across the leagues at all different levels who are finding out the detail of the legislation and some of them are quite shocked. The fact that the media are beginning to pick up on it is quite important.
I would like fans to have a proper opportunity to have a debate as the law is understood and rolled out, so that they can take things into consideration. I am not trying to insult fans. I am not trying to say they do not know what they are voting for. That kind of paternalism annoys me. But I sat through about half of this Committee, maybe less, for hours and hours, as others have and, despite some snipes about filibustering, I have found the contributions to be brilliantly well informed. There have been lots of layers of debate and lots of nuance from all the contributors. I say that because I thought I knew what was coming up in the Bill but I have had some genuine shocks about its political consequences.
Lord Pannick (CB)
My Lords, I hope that before Report the Government will carefully consider how best to ensure post-legislative scrutiny of the Bill. That is the issue being raised here. There are many ways of achieving it and I would welcome the Government thinking about it and discussing with noble Lords who have been expressing concerns how it is to be achieved.
I also hope that, before Report, the Government will give very careful thought to the comments made by the noble Lord, Lord Birt, earlier about the ways in which the Bill can be amended or implemented to ensure proportionate, light-touch regulation, which I think many of us around the Committee are concerned to achieve. It is a difficult thing to achieve, but it needs to be to be achieved and, if it can be achieved, I think that will alleviate many of the concerns that have been expressed in Committee.
Lord Hannan of Kingsclere (Con)
My Lords, I support my noble friend Lord Goodman’s amendments and the principle of a sunset clause.
“The delegation of particular tasks to separate bodies, while a regular feature, is yet only the first step in the process by which a democracy … relinquishes its powers”.
So wrote FA Hayek in chapter five of his magnum opus The Road to Serfdom in 1944. Think of how much truer it is today than it was then. By one account, we have had a new quango every week since the election, and it is a one-way system. They are never undone, and they are not undone because of the dynamic that, once an organisation like that exists and is in place, its primary purpose becomes the defence of its own existence and its own budget. That is why we have sunset clauses at all. It is the only way in which, realistically, you can put in a hedge in case the calculation on which you passed legislation or created a quango turns out to be false.
In this case, it may or it may not. The noble Baroness, Lady Taylor of Bolton, tells us that the legislation is terrifically popular and that the fans are demanding it and want immediate action; the noble Lord, Lord Hannett of Everton, says that it has been polled and everyone is in favour of it. That may be—I do not know, as I am not any kind of expert—and I am perfectly happy to accept the possibility. Equally, we should be cognisant of the figures that the noble Baroness, Lady Fox, cited: 20,000 people of the 2 billion who watch Premier League games is one in 100,000—someone will tell me if my maths is off. It may be that that is a self-selecting and unrepresentative sample.
It is certainly the case, as any pollster will tell you, that people are very bad predictors of how they will feel in a hypothetical situation. If people are asked for an opinion now, and polled in the abstract on whether they think there should be some regulation of football, they might think that it would be a way of preventing rogue owners driving clubs into bankruptcy and so it seems a good idea. But what happens if, two or three years from now, the regulator does what almost every other regulator in this country’s history has done and expands its remit well beyond the powers laid down and discussed in your Lordships’ House? What if fans are then looking at a regulator that is doing things that were never envisaged? There are regulators laying down rules on net zero and gender quotas—and we have already had demands for clubs to monitor the diversity of their season ticket holders and so on. Fans will realise that, hang on, this is not what they signed up for. What then will be the mechanism and check on this legislation?
The only way of doing that is to have some kind of automatic lapsing; in other words, to allow this House and the other House to come back and say either that the legislation is working, so it should be renewed, or that it is not working, so it should be allowed to lapse. This should not be a controversial proposal. I do not doubt for a second the sincerity of noble Lords on all sides who have argued that this is a popular and necessary Bill. If it is, they should have the courage of their convictions. If it is, there will be no question—for all the reasons that my noble friend set out at the beginning—but that the regulator should remain in operation or that the Minister will keep it that way.
We must allow for the possibility that we may have got this wrong. It costs very little and would satisfy all sides. It is something that ought to be able to command consent in this Committee and beyond. I hope that the Minister will give it serious consideration.
Baroness Brady (Con)
My Lords, before I speak to the amendments in this group, I want to address the accusation from the noble Lord, Lord Watson, that West Ham United has put its season ticket prices up mid-season. That is categorically untrue. We have the cheapest adult season ticket in the league, at £345. Since we moved into the London stadium, we have sold 35,000 season tickets for £99 to juniors. We have two “kids for a quid” games every year in the Premier League at the club. We are more than doing our bit.
Lord Watson of Invergowrie (Lab)
If I have got that wrong, I unequivocally apologise to the noble Baroness. I was reading an article about football supporters, including of West Ham, who were protesting about changes to season tickets. Maybe it is not within this season but next season, but there were fairly significant changes being put forward, and the argument was that children were not being given cheaper prices, which will stop them becoming regular fans at football matches. If what I said was wrong, I apologise.
Baroness Brady (Con)
I accept the noble Lord’s apology.
The hour is late, but as we debate this idea of a sunset clause, we should pause and reflect on what is truly at stake. We are all here during extra time because all of us—bar one, I think—love football. It is a cultural touchstone, an economic powerhouse and a source of immense national pride. At its best, football connects communities, inspires individuals and projects the best of Britain to the world.
The Premier League is only one part of English football. I operated in the EFL system for many years and know that it is hugely important to our pyramid, as is the National League. But the Premier League is special for our country: with its global reach, this fizzing, vibrant competition has an extraordinary ability to draw interest, investment and innovation into the game. It not only powers the football pyramid but supports £8 billion in gross value added to the economy, contributes over £4 billion annually to the Exchequer and supports more than 90,000 jobs. The Premier League’s influence extends far beyond the pitch, creating an affinity for the UK and showcasing our ability to create a product that the world wants to watch.
We all know the background and the well-made case for some sort of regulatory intervention, but with this particular Bill we are now at a crossroads. I am passionate about this and live it every day, so I can see the risks very clearly. But I also know that this is a well-intentioned piece of legislation with aims that we can all support. The reason we have been so forensic and questioning during Committee is that it genuinely has the potential to inadvertently damage the structures that have made English football the envy of the world. We are not imagining these deficiencies in the Bill, or the risks that could play out. This is why I am interested in the idea of assessing whether this legislation and the IFR have achieved their goals or inadvertently harmed the game we all love.
The Government have rightly made economic growth their overriding priority. In a time of global economic turbulence and domestic fiscal and productivity challenges, it is vital that we protect and nurture the UK’s most successful industries. Football is clearly one of these: a global export that not only generates revenue but enhances Britain’s soft power and investor appetite for the UK on the world stage. It is against this backdrop that I must express surprise at the puzzling reluctance so far of the Government to listen to the concerns we have been expressing.
At a time when the Prime Minister has asked all regulators to focus on growth—and has also apparently asked Ministers to cancel all anti-growth measures—here we are, about to create a regulator that has no growth duties or objectives. We even read in the newspapers that the Chancellor has told regulators this week that they need to go further and faster in stripping back unnecessary rules and creating an environment where companies can take risks.
But this new regulator will be principally charged with risk reduction and, effectively, a new form of taxation on specifically one part of football, the Premier League. This is a mandate that seems inherently restrictive, redistributive and therefore anti-growth. The signal this will send to global investors could be troubling. If we overreach in regulating one of the UK’s greatest success stories, what might that say about our ability to protect and nurture other industries?
Poorly executed regulation would not just chill investment in football; it would ripple out into broader perceptions of the UK as a place to do business. A sunset clause is an interesting idea. It is clearly important that we do not undermine the regulator from the get-go. We all want this to work. But it is important that an appropriate review and accountability mechanism is found, so that a future Government can assess whether this Bill is delivering the sustainability it promises or whether it is in fact creating regulatory uncertainty and systematic risk, and damaging investment—in which case, we would want to see urgent remedial action.
As I have said this evening, the Premier League and its clubs are not opposed to change. What we do ask, though, is for change to be thoughtful, measured and informed by the realities of what makes football so successful. This Bill has the potential to do some good, but it also carries significant risks that, I say to the Minister, deserve to be engaged with seriously and constructively.
Today, the Premier League is competing not only with domestic leagues but international competitions, other global events and new forms of entertainment in what is a rapidly changing media industry. The UK has created something so special in the Premier League. We should not stifle our ability to adapt in order to deal with these new threats. We should not be complacent when it would be so easy to be knocked off course. We should not gamble that the Premier League is now an unstoppable juggernaut, immune to even the unintended consequences of its own Government’s actions. Empires rise, but they also fall.
It has been said that the Premier League has become the goose that is laying English football’s golden egg. I would encourage all noble Lords to think about it that way, rather than as a cow to be milked or a magic money tree to be shaken. Above all, we should look after it. We should nurture it. Dare I say that perhaps we should even think about how we can help it, not hurt it? We should work together to ensures that it continues to be so successful. To do so, it is obvious that we need some sensible changes to this Bill, and I sincerely hope we can achieve them together as we move towards Report.
Lord Markham (Con)
It is late, so I am sure that all noble Lords will be pleased to know that I will keep my comments short.
Lord Markham (Con)
There we go—the biggest cheer of the night.
As this is the last debate of what has been an extensive process, I echo some earlier comments by thanking the Minister for all her time and involvement over all these days in Committee. I thank all noble Lords for what has been an extensive number of days’ debate. I hope that we may have one new convert as a fan, but maybe not. The debate has been so extensive over those days—as mentioned, there have been 380 amendments—and there is such extensive expertise around the Chamber. So many key points have been raised and there is an understanding that the consequences of getting this wrong are pretty extreme.
There seems to be consensus, as mentioned by the noble Lord, Lord Pannick, that there needs to be some sort of review and some mechanism for that. I must admit that I do not think that is the “state of the game” report, because that is written by the regulator. It is extremely unlikely that the regulator would say in that report, “In all of this, the regulator is pretty rubbish and should be reviewed”. That is probably an unlikely outcome from the “state of the game” report. This post-legislative review needs to be conducted by someone who is not at the regulator, because otherwise it would be marking its own homework.
I thank my noble friend Lord Goodman for raising this. A sunset is one very good way of looking at it, but we have had other suggestions as well. I ask the Minister to spend the time between now and Report thinking about how we are to get some sort of post-legislative review, to make sure that we get this all right. Lastly, I also ask the Minister to spend the time that we have to reflect on all the views expressed over the many hours and days of debate on this. I look forward to discussing her thoughts on them when we have the meeting in February.
Baroness Twycross (Lab)
I am grateful to all noble Lords for staying the course to debate this group. I am not going to use any footballing metaphors, because I think we have exhausted them during the Committee and clearly this is the final group. I want to stress that I am really happy to continue to meet noble Lords before Report to make sure that we can talk through concerns that they have raised ahead of the next stage in the progress of the legislation through your Lordships’ House.
I thank the noble Lord, Lord Goodman of Wycombe, for tabling these amendments, which have allowed a debate about what kind of scrutiny we might need for a new regulator of this type. I am also grateful to the noble Lord, Lord Norton of Louth, for waiting so late to contribute, particularly given his complete lack of interest in football. There is a real value in hearing from people who are interested in regulation and what makes good legislation when we look at something where there is a risk that noble Lords—or anyone looking at the legislation—might approach it from the perspective of themselves as a fan, rather than what we need to have, which is good legislation, a good regulator and effective regulation.
I am also grateful to my noble friend Lady Taylor of Bolton for her contribution. Her expertise has been recognised by other noble Lords as well. I am keen to reflect on these contributions and the points raised by the noble Lords, Lord Pannick and Lord Addington, ahead of Report. I will take the points about scrutiny and accountability away for further consideration. I will go through a number of points—unfortunately, I am going to keep noble Lords a little longer—but I want to reflect properly on the points that have been raised.
Going back to the amendments tabled by the noble Lord, Lord Goodman, unfortunately, while we completely agree that the efficacy of the regulator should be monitored and evaluated—and I am happy to discuss this point further with the noble Lord—I cannot stress enough how strongly we disagree with the use of a sunset clause in this context. I agree with my noble friend Lady Taylor that these amendments would create a perverse incentive for the regulated industry to deliberately act in bad faith from the outset in the hope that the regulator fails to achieve its objectives and is therefore scrapped. We do not want, through the design of the legislation, to encourage or risk encouraging any non-compliance or vexatious behaviour by clubs and competition organisers who might be setting out with the intention of frustrating the regulator. We want to create the right conditions so that clubs act in a sustainable way, and we feel that the approach adopted is the right one.
On the other points raised by the noble Lord, Lord Goodman, surely, we want a regime that creates incentives for clubs to comply and improve sustainability. Under the amendment, the panel would make the decision, but there would still be an incentive for industry to show that the regime is not working. I also had concerns about the noble Lord saying that this would not be a problem because the Secretary of State would appoint the panel. If the Secretary of State can appoint a panel, knowing that it is not going to act against what the Secretary of State might have already decided, that is not a good panel. Therefore, with respect, I cannot agree with the noble Lord’s comments.
Giving the regulator a deadline of five years would also create the incentive for it to become more interventionist. Knowing it will be judged on whether it was meeting its objectives within a fixed period, the regulator could feel compelled to pursue more severe short-term solutions; this would be an undesirable unintended consequence. In addition to introducing these perverse incentives on both sides, a sunset clause would create inherent uncertainty in the market, as default expiry of the legislation in five years’ time, unless regulations are made to the contrary, would leave the industry and investors unclear on what basis they should plan for the future. We do not want to leave the Government or Parliament open to persistent lobbying to trigger the sunset clause.
The noble Lord, Lord Goodman, raised the important issue of accountability. This is already built in through the “state of the game” report and the annual report. However, I do recognise the point made by the noble Lord, Lord Markham, that these are produced by the regulator, albeit that the “state of the game” report will be based on data from the industry. While I understand the noble Lord’s concerns, the Government believe that the current measures already ensure sufficient scrutiny of the regulator and that it can be held to account if necessary—for example, through the DCMS’s role as sponsor and the requirement for an annual report to be laid before Parliament.
Parliament’s Select Committees can also conduct inquiries into any aspect of the work of the regulator once it is established and take evidence on such matters. The Government believe, given the aforementioned risks associated with the sunset clause, that it would not be an effective way to ensure accountability. For the reasons I have set out, I hope the noble Lord will withdraw his amendment.
Lord Goodman of Wycombe (Con)
My Lords, I am very grateful to all those who have spoken in this appropriately sober debate, especially to my noble—and non-footballing—friend Lord Norton for coming in and sharing his expertise with us. I suppose it is scarcely surprising that those noble Lords who are sceptical of state regulation favour the sunset clause, and those who are supportive of it are not. The Minister did not fully answer the argument I put to her. I find it hard to see why a panel appointed by her, which could be trusted to be fair-minded rather than biased one way or the other, would deliberately frustrate the regulator if that panel of experts thought the regulator was right. But these are matters to which we may be able to return on Report.
In the interim, I will simply make two points. First, it is very encouraging to see that there is agreement throughout the Committee that there needs to be more effective post-legislative scrutiny. This point was made briefly but very forcefully by the noble Lord, Lord Pannick. My challenge to the noble Baroness, Lady Taylor, is this: if noble Lords do not like the sunset clause as a means of post-legislative scrutiny, let us come up with something else specific, rather than simply issue the general wish that things can somehow be made better.
Finally, a noble Lord said, “Fans want this”. Once again, I say that something like 33 million people watch football. Some of them will be unaware that this is coming down the tracks. I predict that many fans will find themselves in the position of the noble Lord, Lord Birt. I suspect that he has sat through more of this Committee than I have—and I have sat through a great deal of it—very quietly assessing what is going on. He is pro the principle of independent regulation, as licensed by the state, whereas I and many of my noble friends are either sceptical or opposed. But he has recognised, as we have dug more deeply into the weeds of this matter, that it is problematic.
I am sure we will return to these problems on Report. In the meantime, I beg leave to withdraw my amendment.