Children's Wellbeing and Schools Bill (Eleventh sitting)
Thursday 6th February 2025
(1 day, 14 hours ago)
Public Bill CommitteesRead Full debate Children’s Wellbeing and Schools Bill 2024-26 View all Children’s Wellbeing and Schools Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 6 February 2025 - (6 Feb 2025)
The Committee divided: - Ayes: 5 / Noes: 12 - Question accordingly negatived.
Neil O’Brien (Harborough, Oadby and Wigston) (Con)
I beg to move amendment 90, in clause 48, page 108, line 24, at end insert—
“(3) Within six months of the passing of this Act, the Secretary of State must issue statutory guidance on the decision-making process that must be followed when directions are given under section 96 of the School Standards and Framework Act 1998.
(4) Guidance issued under subsection (3) must include details of—
(a) how actual or potential conflicts of interest arising from the role of local authorities in directing admissions to schools they maintain and those they do not are to be identified and managed; and
(b) how the best interests of children and young people are to be prioritised in all decision-making.”
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clause 49 stand part.
New clause 45—Power to direct admission not to have regard to maintained or academy status—
“In section 96 of the School Standards and Framework Act 1998 (direction to admit child to specified school), after subsection (2) insert—
‘(2A) A direction under this section may not take into account whether a school is a maintained school or an academy.’”
Neil O’Brien
We heard some concern about clauses 48 and 49 in our evidence sessions. One of the issues is the potential conflict of interest between the local authority being both the regulator of the local system and, at the same time, a provider of some of the schools but not others. Sir Dan Moynihan said,
“there is potentially a conflict of interest if local authorities are opening their own schools and there are very hard-to-place kids. There is a conflict of interest in where they are allocating those children, so there needs to be a clear right of appeal in order to ensure that that conflict can be exposed if necessary…Some of the schools we have taken on have failed because they have admitted large numbers of hard-to-place children…I think there are schools that get into difficulty and fail because there is perceived local hierarchy of schools, and those are the schools that get those children. That is why there needs to be a clear right of appeal to prevent that from happening.”––[Official Report, Children's Wellbeing and Schools Public Bill Committee, 21 January 2025; c. 73, Q158.]
Luke Sparkes from Dixons also made roughly the same point.
Amendment 90 would require the Secretary of State to set out statutory guidance on
“how actual or potential conflicts of interest arising from the role of local authorities in directing admissions to schools they maintain and those they do not are to be identified and managed; and… how the best interests of children and young people are to be prioritised in all decision-making.”
New clause 45 would write into the legislation:
“A direction under this section may not take into account whether a school is a maintained school or an academy.”
Neither measure would fundamentally change the clause, but they require a solution to address that potential conflict of interest and ensure that things are fair, and are seen to be fair.
The Minister for School Standards (Catherine McKinnell)
I rise to speak to amendment 90 and clauses 48 and 49. The clauses aim to strengthen local authorities’ existing powers to direct a school to admit a child and provide a more robust safety net for vulnerable children by ensuring that school places can be secured for them more quickly and efficiently when the usual admissions processes fall short.
Amendment 90 seeks to require the Secretary of State to publish statutory guidance as to how local authorities may exercise their direction powers impartially and in the best interests of children and young people. I note the concerns of the hon. Members that this new power may give rise to conflicts of interests in local authorities’ dealings with the schools that they maintain and those that they do not. I also agree that it is important that local authorities exercise their direction powers appropriately and in the best interests of children and young people.
I reassure hon. Members that legislation, as well as the school admissions code, already sets out mandatory requirements as to how local authorities may exercise their direction powers. They are intended for use only as a last resort and may only be used where admissions cannot be secured through the usual processes. To ensure that decisions are made in the best interests of a child, section 96 of the School Standards and Framework Act 1998 already requires local authorities to ensure that they choose a school that is within a reasonable distance of a child’s home and provides education suitable to their age, ability, aptitude and any specific educational needs that the child may have.
Furthermore, in considering which school to place the child, there are several other factors that local authorities are already required to take into consideration. For example, local authorities are unable to direct a school from which the child has been permanently excluded, or if it would mean that the school would have to take measures to avoid breaking the rules on infant class sizes. Furthermore, they are unable to direct a school’s sixth form if the child does not meet the relevant entry requirements.
In relation to a looked-after child, local authorities cannot direct a school where the child has been permanently excluded from that school previously or where the schools adjudicator deems the admission of the child would result in serious prejudice following an appeal by the school against the direction.
Furthermore, section 97 of the School Standards and Framework Act 1998 sets out further processes that a local authority must adhere to when considering exercising its direction powers. These include various requirements on consultation, including requiring the local authority to consult with the governing body of the school, the parent of the child and the child themselves, if they are over compulsory school age, before seeking to direct a school. Governing bodies are also provided the opportunity to appeal against any decision by the local authority to direct a child into their school.
Clause 48 enables the same requirements to apply equally in relation to a decision to direct an academy, including making it clear that academy trusts will have the right to appeal to the schools adjudicator against a local authority’s decision to direct their school. Those requirements will all be reflected in the school admissions code, which we intend to amend following Royal Assent. We also intend to work closely with the sector on any further changes that may be needed to fully implement the new powers.
Any change in the code will require a full public consultation and will be subject to parliamentary scrutiny before coming into effect, so I hope that the hon. Members for Harborough, Oadby and Wigston and for Central Suffolk and North Ipswich are reassured that we will take action to ensure that the statutory school admissions code will be amended accordingly and continue to set out clear guidance on how local authorities may exercise their direction powers following Royal Assent. We therefore do not consider the amendment necessary and kindly ask the hon. Member for Harborough, Oadby and Wigston to withdraw it.
I turn to clauses 48 and 49. Local authorities have statutory duties to ensure that children in their area have access to a suitable education, but the levers are currently not available to them to achieve that, as they are not always effective. That can result in too many children, many of whom are vulnerable, being left without a school place for too long. Every day lost in a child’s education is one that they cannot get back. Powers of direction are intended to be used only as a last resort in those rare circumstances in which families are unable to secure a place through the usual admissions processes.
The purpose of clauses 48 and 49 is to create a more robust safety net for vulnerable children by giving local authorities the levers they need to secure school places for children more quickly and efficiently when the usual admissions processes fall short, ensuring that no child falls through the cracks. Clause 48 extends the current powers of local authorities to direct a maintained school to admit a child and to enable them to direct academies in the same way.
Although most children will secure a place through the usual admissions processes, vulnerable and hard-to-place children can sometimes struggle to do so. In circumstances in which those children have been refused entry to or have been permanently excluded from every suitable school within a reasonable distance, the local authority has the power to direct a maintained school for which they are not the admission authority to admit that child.
However, where a local authority wishes to place a child in an academy, it currently must request that the Secretary of State uses her direction powers under the academy’s funding agreement to compel the school to admit the child. That additional step can create further delay in getting a child into school. Enabling local authorities to direct academies themselves without needing to go through the process of requesting the Secretary of State to invoke her direction powers will ensure that school places for unplaced and vulnerable children can be secured quickly and efficiently. It does not make sense for local authorities to continue to need to ask the Secretary of State to make such direction for an academy.
Clause 49 further streamlines local authorities’ admission direction processes and makes them more transparent by enabling local authorities to direct a school where the fair access protocol fails to secure a school place for a child. The fair access protocol is a local mechanism for securing school places for children struggling to secure one through the usual admissions processes. The school admissions code requires all local authorities to have a fair access protocol in place that has been agreed with local schools and specifies the categories of children, including vulnerable and hard-to-place children, who are eligible to be considered for a school place under the fair access protocol.
Clause 49 will also enable future iterations of the admissions code to specify circumstances in which local authorities are able to direct the admission of a child where the fair access protocol has been exhausted and fails to secure a place for them. It will also allow the admissions code to set out a more streamlined directions process for children who have come out of care, so as to provide these often still vulnerable children greater parity with children currently in care. As mentioned, we intend to work closely with the sector in implementing the changes to the admissions code, which will include a full public consultation and require parliamentary approval.
I hope that I have reassured hon. Members that clauses 48 and 49 will provide a more robust safety net for vulnerable children by ensuring that places can be secured for them more quickly and efficiently when the usual admissions processes fall short, minimising time out of school and reducing the likelihood of children falling between the cracks. As I have mentioned, to ensure the powers are used appropriately, clause 48 will provide academies that disagree with a decision to direct admission with a formal route of appeal to the schools adjudicator, giving academies the same route of redress as is currently available only to maintained schools. That safeguard will ensure that local authorities use their powers appropriately and place children in suitable schools where they can thrive. I commend clauses 48 and 49 to the Committee.
New clause 45, which was tabled by the hon. Members for Harborough, Oadby and Wigston, and for Central Suffolk and North Ipswich, aims to ensure that where a local authority is considering directing a school to admit a child, it does not take account of whether the school is a maintained school or an academy. The hon. Members appear to be concerned that a new power for local authorities to direct academy schools may give rise to potential conflicts of interest.
As I have mentioned, the power is intended for use only as a last resort, and may be used only where admissions cannot be secured through the usual processes. Under public law principles, local authorities are already prevented from taking irrelevant matters into consideration when taking decisions, and in most circumstances, whether a school is an academy is not likely to be a relevant factor in determining whether to direct a school to admit a child. Furthermore, as I set out earlier, the School Standards and Framework Act 1998 and the school admissions code already set out several requirements as to how local authorities may exercise their direction powers. Those include relevant factors that they must take into consideration when deciding to direct a school, as well as the processes they must follow when making a direction.
Local authorities can already request that the Secretary of State direct a pupil into an academy on their behalf, and we know from experience that local authorities use this route only where they consider that it is in the best interests of the pupil, and after careful thought and consideration about the impact on the school. However, the new right for an academy trust to appeal to the independent schools adjudicator where they disagree with a direction for them to admit a child will provide independent oversight of local authorities’ decisions to direct.
I hope that the hon. Members will be reassured that appropriate checks and balances will be in place to mitigate any risk of the misuse of the power by local authorities, and kindly ask that the amendment be withdrawn.
Amanda Martin (Portsmouth North) (Lab)
I am grateful for the opportunity to serve under your chairmanship, Sir Edward.
While we were in Bill Committee on Tuesday, the Education Committee was meeting—there are many people with a lot of interest in the Bill, and rightly so—to hear from three panels of witnesses. I draw the Committee’s attention to the second panel. On the panel was Sam Freedman, a senior fellow at the Institute for Government who worked at the Department for Education from 2010 to 2013 as a senior policy adviser; she is also a senior adviser to Ark schools, although was appearing in a personal capacity. Also on the panel were Daniel Kebede, who is a former teacher and the general secretary of the National Education Union, and John Barneby, who is the chief executive of Oasis Community Learning.
The witnesses did not agree on everything, but all three commented on the benefits of these provisions. John Barneby said that Oasis follows
“local authority admissions at the moment, because we believe in equity of offer, and we want to work in partnership. That is not the case everywhere…My hope is that, out of this policy, we will get to a place where there is a fair distribution of children with special educational needs and disadvantaged children across all schools, so that all schools are truly inclusive and have the capacity to meet the needs of all children.”
He thinks the Bill will go some way to doing that. He also said that there has been a risk raised around the allocation of students, particularly with falling student numbers, but he thinks that
“on the whole, local authorities act responsibly around this.”
Neil O’Brien
I think Sam Freedman is a fella rather than a lady. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 48 ordered to stand part of the Bill.
Clause 49 ordered to stand part of the Bill.
Clause 50
Functions of adjudicator in relation to admission numbers
Neil O’Brien
I beg to move amendment 84, in clause 50, page 110, line 4, at end insert—
“(4A) Where making a decision the adjudicator must take into account—
(a) the performance of the school; and
(b) whether the school is oversubscribed.”
The Chair
With this it will be convenient to discuss the following:
Amendment 83, in clause 50, page 110, leave out lines 8 to 13.
Clause stand part.
New clause 46—High performing schools to be allowed to expand PAN—
“In section 88D of the School Standards and Framework Act 1998 (determination of admission numbers), after subsection (1) insert—
‘(1A) Where a school—
(a) being a primary school, has over 60% of its pupils meeting the expected standard in reading, writing and maths combined in the Key Stage 2 national curriculum assessments,
(b) being a secondary school, is performing above +0.5 on Progress 8,
wishes to increase its published admissions number, the admission authority must reflect that wish in its determination.’”
New Clause 47—Limits on objections to changes to PAN—
“In section 88H of the School Standards and Framework Act 1998 (reference of objections to adjudicator), after subsection (2) insert—
‘(2A) No objection may be referred to the adjudicator which—
(a) objects to an increase in a school’s published admissions number; or
(b) objects to a school’s published admissions number remaining at the same level.’”
Neil O’Brien
Clause 50 is one of the elements of the Bill that we are most concerned about. The Government’s impact assessment says:
“Demographic changes mean there is an increase in the number of surplus places in primary schools...We want the local authority to have more influence over the PANs for schools in their area”.
For the benefit of people following the sitting, PAN is the published admission number—the number of pupils a school takes on each year.
The impact assessment continues:
“This would include scenarios where...a school’s PAN is set at a level which creates viability issues for another local school”.
In my mind, that line creates many questions. In a city like London, there are roughly 2,700 or 2,800 state schools, and cross-authority moves are very common. If I have an excellent and oversubscribed school, and someone else’s requires improvement and is struggling to attract pupils, how on earth are they to know that it is my school that is creating viability issues for their school, rather than one of the other hundreds of schools nearby? Indeed, how are we to know that the viability issues are not entirely to do with the struggling school, and how is the schools adjudicator to make such decisions? In reverse, how are the pupils from a thriving school to be shared out fairly if there are multiple struggling schools in the area? As soon as we start to think about it, these are massive questions.
The impact assessment makes it clear that this measure is a huge departure from the path we have been on since the reforms of the late 1980s, which gave good schools the ability to expand without the local authority blocking them. The impact assessment says:
“The Adjudicator will also have the ability to set the PAN for the subsequent year”
and
“some schools may find that their PAN is not set for them as they would wish. They may feel that they are able to take more pupils and thus receive greater funding. It could also limit the ability of popular schools to grow.”
Those are the Government’s words, not mine. They continue:
“If a school is required to lower their PAN, some pupils who would have otherwise been admitted will be unable to attend the school. This will negatively impact on parental preference, especially if the school was the parent’s first choice.”
The Confederation of School Trusts has pointed out that the impact assessment does not account for the potential risks of reducing PANs for popular and successful schools. Our amendments address exactly that point. Once again, rather than the normal split between the regulator and the provider, the local authorities will be both. Politicians in some local authorities—this is not a secret—have never much liked the academy programme or school freedom. It would be very tempting for them to try to push down numbers in academies, particularly to protect the schools that they run even if they are not the best ones or the ones that parents want. For all those reasons, the right hon. Member for Islington North (Jeremy Corbyn), the former Labour leader, was positive about the clause on Second Reading. However, for the reasons that he is positive about it I am rather nervous about it.
Amendment 84 would write into the Bill:
“Where making a decision the adjudicator must take into account—
(a) the performance of the school; and
(b) whether the school is oversubscribed.”
It would make it clear that we need to deal with the issues now, at this point of democratic decision and transparency, and write those principles into law rather than leave it to Ministers and regulations, meaning that the handling of highly significant issues could easily later shift, with little scrutiny, under a different Secretary of State.
New clause 47 would stop objections to stable or growing PANs, and new clause 46 would at least exempt high performing schools and allow them to still expand. A striking thing about the clause is that it is not just allowing appeals against schools expanding for the first time—a massive move away from the principles of the School Standards and Framework Act 1998—but even allowing appeals against schools just staying the same and carrying on doing what they are doing. That can now be challenged, and the only reason to do that is to share out the pupils in order to help other schools be more viable.
Will the powers be used? Yes, absolutely they will, because the context, of course, is the forecast decline in pupil numbers. Indeed, the impact assessment gives that as one of the rationales in London and other urban areas. The declines are forecast to be quite steep. Often local forecasts turn out to be wrong, but in some London boroughs the forecast is for more than one in 10 or even one in eight pupils to disappear over the next four years. In that context, the temptation to prop up some schools by pressing for reductions in others will be very strong, particularly for local authorities that do not like school choice much, but even in others, too.
At present there is nothing in the Bill to reassure us or school leaders that this will be done fairly between local authority and non-local authority schools, or fairly reflecting how well schools are performing or fairly reflecting how popular they are. There is nothing but the suggestion of future guidance, which the House will not be able to amend and which can shift with the views of whoever is Secretary of State at the time. There is some deep history here. It was Mrs Thatcher who announced the reforms that the Government are starting to undo today. It was initially called the local management of schools. When Mrs Thatcher announced it, she said,
“We will allow popular schools to take in as many children as space will permit. And this will stop local authorities from putting artificially low limits on entry to good schools. And second, we will give parents and governors the right to take their children’s school out of the hands of the local authority and into the hands of their own governing body. This will create a new kind of school funded by the State, alongside the present State schools and the independent private schools. They will bring a better education to many children because the school will be in the hands of those who care most for it and for its future.”
Did those reforms work? Well, the former Education Minister, Lord Adonis, who wrote about the creation of the school freedom, concluded:
“Local Management of Schools was an unalloyed and almost immediate success…school budgets under LMS were based largely on pupil numbers, so parental choice came to matter as never before.”
Several times during our debates I have heard Labour Members say that they believe in “standards, not structures”. We heard it in the last sitting and I have heard it from Ministers. But let me quote from another great socialist thinker, former Prime Minister Tony Blair, who says in his memoirs,
“We had come to power in 1997 saying it was ‘standards not structures’ that mattered. We said this in respect of education, but it applied equally to health and other public services. Unfortunately, as I began to realise, when experience shaped our thinking, it was bunkum as a piece of policy. The whole point is that structures beget standards. How a service is configured affects outcomes.”
This clause strikes at one of the most foundational school reforms of the last 40 years. It strikes at school choice by making the size of schools not a matter for parents in choosing and voting with their feet, but instead for local councillors and the schools adjudicator. You strike at parental choice and you strike at one of the most powerful engines for school improvement.
Although I understand what Ministers are trying to do, this is currently being done in the Bill without any of the basic safeguards we would expect on how they will make those decisions. I understand what Ministers are trying to do, but I think this is one of the worst clauses in the Bill, and I really hope that Ministers will rethink it.
Catherine McKinnell
Clause 50 covers the ability of the schools adjudicator to set the published admissions number of a school where the adjudicator has upheld an objection to it. This provides an important backstop to ensure that all children are able to access a place at a school where they can achieve and thrive.
Amendments 84 and 83 relate to the matters the adjudicator must take into account when deciding on a school’s published admissions number and the means by which those requirements are placed upon her. I will discuss each of these matters in turn, but there are clearly important connections between the two.
Amendment 84 would requires the adjudicator to take into account the school’s performance and whether it is oversubscribed when deciding on what the school’s published admissions number should be following an upheld objection. School performance and parental demand are clearly important factors that adjudicators should consider when determining objections to published admission numbers. Indeed, previous adjudicator determinations on schools reducing published admission numbers show that the adjudicator regularly takes these matters into consideration where they are relevant to a case.
However, specifying that the adjudicator must only take account of these factors and no other factors could hinder effective decision making and damage the interests of schools and communities. Although the expansion of good schools is to be celebrated, we know that in some areas schools are unilaterally increasing their admission numbers beyond what is needed, damaging the quality of education that children receive at nearby schools by making it harder for school leaders to plan the best education for their children.
Therefore, it is right that the adjudicator’s decisions about the level at which to set the admission number following an upheld objection should also consider the wider impact on the community. For example, this could include potential impacts on parental choice if the quality of education that children receive at other schools nearby is affected.
Furthermore, there are other factors that it may be important for the adjudicator to consider or that provide necessary safeguards for the school that is the subject of the objection, such as statutory financial or capacity requirements. For example, primary schools are required to comply with the statutory infant class-size limit and we would want the adjudicator to ensure that any published admission number they set enables the school to comply with this important duty.
Neil O'Brien
The Minister talks about schools expanding “beyond what is needed”. How will she determine whether a school’s expansion is “beyond what is needed”? Is it the presence of any “surplus” school places in that local authority area?
Catherine McKinnell
As I have set out, these are matters for the school adjudicator to determine on when objections have been raised with them. Schools adjudicators are independent, which is an important factor in this process. They have significant experience of considering objection cases and they are ideally placed to take objective, transparent and impartial decisions.
Neil O'Brien
It was the Minister herself who said “we know” that some schools had expanded “beyond what was needed”’; she did not say that an admissions adjudicator had determined that. In response to my challenge, she referred to the admissions adjudicator, but it was she herself who said “we know” that some schools had expanded beyond the point that was “needed”. How does she know that? On what basis does she say that?
Catherine McKinnell
Obviously, the purpose of the clause is to ensure that those decisions are made independently by the schools adjudicator. I think the hon. Gentleman should acknowledge that he is objecting to an independent adjudication on these matters, which is entirely the purpose of this legislative provision.
Catherine Atkinson (Derby North) (Lab)
We recently saw a case of a ghost school in Nottingham, funded under the previous Government, built but then never opened, because only two pupils applied to join. Does the Minister agree that that is an example of the current system failing?
Catherine McKinnell
My hon. Friend makes an important point. Clearly, it is really important that we have good schools available to every child in every local area. That is clearly a challenge. A significant number of children, including those with special educational needs and disabilities, are not having their needs met within their local school, and they consequently have to travel as a result. As constituency MPs, we have to deal with the families who get in touch because they cannot get a place at their local school and the challenges around that. It is clearly in the interests of everybody that we have a system that manages that, but also that we have an adjudicator that takes an independent view and decides on what would be the right outcome in a particular circumstance.
Matt Bishop (Forest of Dean) (Lab)
Does this part of the Bill not go to the principle that local schools should meet local needs?
Catherine McKinnell
My hon. Friend puts it very well. Indeed, that is the case that we are making. That means having good and great schools, and that is the ultimate aim of all these provisions: to ensure that every child has a good local school in which they can achieve and thrive. There needs to be some way in which that is managed on a community-wide basis. I would be surprised if the hon. Member for Harborough, Oadby and Wigston were seriously objecting to that in principle.
Damian Hinds (East Hampshire) (Con)
I seek some clarity. The Minister seems to be saying, “Leave it up to the independent adjudicator. They will decide.” Is she saying that the Government will not issue guidance on the criteria on which an independent adjudicator should decide?
Catherine McKinnell
No, that is not what I said. I was responding to the specific question asked by the hon. Member for Harborough, Oadby and Wigston.
These measures are being introduced to support local authorities with effective place planning. In answer to the question raised by the hon. Member for Harborough, Oadby and Wigston about how we know that this challenge needs action, a 2022 report commissioned by the Department for Education under the previous Government reported that
“unilateral decisions about PANs and admissions…was identified by 89% of LAs”
as a barrier to fulfilling their responsibilities for mainstream school place planning. Some 13% of local authorities reported that
“this occurred regularly, 41% occasionally, and 34% rarely”.
Local authorities were more likely to report that this barrier was more common when working with academies. Those are the findings of the Department’s own report, which was commissioned under the last Government.
To be clear, the measure is not about removing any and all surplus places from the school system, including where it is useful, for example, in ensuring parental choice and flexibility in the system to accommodate future demand for school places. This is about ensuring that the places on offer in an area adequately reflect the needs of that local community. Where there is large surplus capacity, that can have a detrimental impact on good schools. It could result in significant upheaval for children and damage local parental choice. This is about supporting local authorities to ensure that they have the right amount of school places in their local area. There is already a statutory obligation on that. This measure will support local authorities to achieve that.
Neil O'Brien
The Minister is talking about within local communities and within local authorities and so on. I raised the issue of how this is supposed to work in London. The Government talked about using this power where
“a school’s PAN is set at a level which creates viability issues for another local school”.
Local is not defined. How is the schools adjudicator to work out whether it is one school that is creating
“viability issues for another local school”
in a setting like London, where there are many schools nearby, or whether some of the viability issues are to do with the school’s own performance, perhaps, because it is not a very good school? How on earth is one to identify fairly in a city like this, with vast flows between boroughs, where the problem is coming from for a “failing” school?
Catherine McKinnell
I recognise the challenge of falling rolls in some London boroughs, which the hon. Member rightly identifies. It just goes to make the case even more strongly: partners have to work collaboratively to ensure that we manage demographic changes properly and that children are at the heart of all decisions.
The measures in the Bill will give local authorities more levers to help manage surplus capacity. For example, the Bill will ensure that if the schools adjudicator upholds an objection that the published admission number of a school is too high to support the community need, the adjudicator will then be able to set the published admission number for the school. Schools and local authorities will be under new duties to co-operate on school admissions and place planning as part of measures to the Bill already debated and passed.
Neil O'Brien
What share of “surplus places” is too high in the eyes of the Minister? Will she set out in guidance what “too high” looks like? What is her view on too high—is it 1%, 2% or 3% surplus places?
Catherine McKinnell
The guidance will set out how local authorities will determine their published admission number. It will also support local authorities with effective place planning, which will be set out in the admissions code. The new delegated powers will set out to adjudicators what they should consider when setting published admission numbers within that context.
I can reassure the hon. Member that adjudicators are experienced at considering these types of issues as part of their existing role. They already do this. They consider both objections to published admission number reductions and requests by maintained schools to vary their published admission number downwards in light of major changes in circumstances. They have an in-depth knowledge of admissions law and play an integral role in ensuring that school admissions are fair and lawful. Many have wide experience of the education system at a very senior level. The hon. Member should not be so concerned that these matters cannot be adjudicated, which seems to be what he is suggesting.
Neil O'Brien
I am not suggesting that they cannot be adjudicated. I am pointing out to the Minister that for them to be adjudicated in a completely new way will mean something very different will happen to our education system. At the moment, the adjudicator can be brought in if a school dramatically wants to cut its numbers. That is fair enough. We need to make sure that all pupils have a place to go to school. But this is something completely new. There is an objection not just to expanding, which is an attack on the principle of school choice, but to schools wanting to keep their published admission number the same.
This is a completely revolutionary change. The adjudicator is not dealing with these kinds of things at the moment for academies, so it is a huge change and a move away from the principles that have allowed good schools to expand and the voices of those who say, “There are too many surplus places; you can go to a worse school and not to your first-choice school” to be squashed by the process of school choice and competition.
Catherine McKinnell
The hon. Gentleman has made his concerns known. I do not think he is making any new assertions. It might be helpful if I continue setting out why we do not accept the proposed amendments.
Catherine McKinnell
Perhaps at the end if there are still questions I would be more than happy to address them.
Damian Hinds
It is a different but related question. There are falling rolls, initially in primary over the next few years, and then it will happen in secondary. There will be some difficult choices that someone will need to make. Sometimes that will mean varying the numbers in every school, but I am afraid that the scale of the change in some local authorities, particularly in urban areas and this city, is such that some schools may convert and become special schools, for which there is demand and need. Some may become early years settings. It might be the case—I hope it will not be, as it is always a difficult thing to do—that total education capacity has to reduce. Will it be the schools adjudicator who decides the school that closes?
Catherine McKinnell
Local authorities make decisions about place planning within their local area. There will be a duty on all schools within a local area to co-operate with the local authority on place planning and admissions. The clause and the Bill extend to academies the ability to object to the school adjudicator, which gives them the ability to present their case where there is a challenge. Clause 50, which I will come to shortly, includes a delegated power that enables the Government to make regulations that set out factors that the adjudicator must consider when setting the published admission number of the school after it has upheld an objection.
Neil O’Brien
To be clear, is it the case that under the clause the schools adjudicator will have the power to set the published admission number to zero—in other words, to close a school?
Catherine McKinnell
Where the adjudicator upholds an objection to the published admission number, I cannot foresee a circumstance where that might be the case—
Catherine McKinnell
It will very much depend on the local context. Obviously, it will be for the adjudicator as an independent professional to take that decision for maintained schools. To be clear, for academies it will be for the Secretary of State to end a funding agreement, and for maintained schools it will be for the local authority to determine.
Amanda Martin
Will the Minister confirm that the power to set place numbers includes all schools in local authority areas? It is not just academies but maintained schools. There seems to have been an idea throughout the whole of this debate that maintained schools are somehow a lower echelon of education—
Amanda Martin
Thank you, Sir Edward. It seems to have been implied that only academies might want to expand, but local authority schools might also want to expand. If it is not right for the pupil numbers within the local authority area, it should not be allowed.
We were asked for examples of where it has happened already. In Hackney in 2024, the expansion of some schools and academies—[Interruption.]
Amanda Martin
We were asked for examples of where schools have been closed. We have not even thought about small rural schools that are affected by expansion. Local authorities that represent rural communities must be able to ensure that there are schools across the county, because that is good for everybody.
Specifically on London, the expansion of some academies and schools in Hackney in 2024, particularly as part of a shift towards academisation, has contributed to the closure of certain local schools. St Mary’s Church of England primary school—
The Chair
Order. That is very interesting, but it is an intervention. In a Committee, you can speak as often as you like, but I think we have got the point now and the Minister should carry on with her speech.
Catherine McKinnell
I thank my hon. Friend for her intervention. She makes powerful and important points relating to the challenges she has experienced in her local area. That is why the changes are necessary to ensure we have a fair system.
The usual approach from Opposition Members is to act as though this is a new thing that has just been invented. This is not a new role for adjudicators. They already consider these issues, not just in proposals to reduce admission numbers—
Catherine McKinnell
Can I finish making one point? Adjudicators do that when schools seek to vary their admission arrangements once they have been determined. I appreciate the hon. Gentleman’s concern about the theoretical prospect—
Catherine McKinnell
It is a hypothetical prospect of a published admission number being set at zero. That will be dealt with as part of regulations and we will set out more detail in those, but we will address that.
Catherine McKinnell
I can get back to the actual substantive response to the amendment, or we can carry on with this debate in the meantime.
Neil O’Brien
This is a substantive point. I am grateful to the Minister for giving way; we are doing the proper business of a Committee here. Let us be clear: the whole point of the clause is to address situations, such as those in London, where a local authority has one in eight of its primary school pupils disappearing within four years, and schools closures will be a part of that. The Minister said that this is not new, but it absolutely is. At the moment, a primary school cannot have its PAN challenged by the local authority if it just wants to keep it the same. In the future, under this clause, the local authority can say, “We want to close this school. We are going to challenge your decision to keep your PAN the same. We think you should shut.” Under this clause, the schools adjudicator will have the power to set its PAN to zero.
Neil O’Brien
The Minister says that the Secretary of State can shut schools in other ways. The schools authority, under this law, will have the power to set a PAN to zero. I did not hear the Minister say that, according to guidance, that should not happen. Will she say that now?
Catherine McKinnell
To deal with the issues that the hon. Gentleman raises, he is wrong that this is a new power.
Catherine McKinnell
If the hon. Gentleman will let me a finish a sentence, he will see. The hon. Gentleman is repeatedly putting words in my mouth by taking snippets of sentences without listening to them entirely. He is concerned that this is intended to address simply matters that might affect London.
Neil O’Brien
Of course it is not. This is stupid. It affects the entire country.
Catherine McKinnell
That is the point I am making. These challenges affect local authorities right up and down the country. The research the previous Government undertook into this matter demonstrated that local authorities, which have a statutory obligation to provide suitable school places for all the children in their local area, face widespread challenges in meeting that obligation because of the challenges in the current system, which the clauses seek to address. Yes, this is a new statutory duty, which is why we are legislating, but it is not a new role for adjudicators. That is the point that I have made a number of times. I am not saying this is not a change, as we are legislating to change things, but it is not a new role for adjudicators. They are well experienced in managing many of these considerations.
The fundamental point is that school closures need to be managed very carefully through significant change or prescribed alteration processes. As I am sure the hon. Member for Harborough, Oadby and Wigston is aware, academies are maintained through contractual arrangements. The parties to the funding agreements are the Secretary of State and the relevant academy trust, and there are no third-party rights given to a local authority under that funding agreement. Any decision relating to the termination of a funding agreement sits with the Secretary of State.
The purpose of the Bill is to put a new requirement on schools, academy trusts and local authorities to co-operate on place planning and admission matters. We expect them to work together to manage the supply of school places and, where necessary, that may include making plans to close a maintained school or academy, if that is the right decision for a particular area.
Amanda Martin
I have already mentioned the three expert witnesses who commented on this issue. Although they probably have very different opinions on other elements of the education system, all were in agreement. Does the Minister believe that the clause, unamended, means that local authorities can perform fair place planning for all pupils, whether in rural, suburban or inner-city areas, to ensure that there is still access for all pupils and that it is done in a fair way, whether a school is maintained or an academy?
Catherine McKinnell
Absolutely, and it is right that where an objection is put to the adjudicator about a published admission number and the adjudicator upholds it, they consider the wider impact on the whole community—for example, how it might affect parental choice or the quality of education for children affected by any decision. The adjudicator should clearly consider other factors that may provide necessary safeguards for a school that is the subject of an objection, such as their financial or capacity requirements. As I will discuss when I turn to amendment 83, that is why clause 50 includes the power to make regulations that set out what the adjudicator must and must not take into account when taking a decision on published admission numbers that must be set where an objection to the published admission numbers is held. I hope that when we get on to the next clause, many of the concerns of the hon. Member for Harborough, Oadby and Wigston will be allayed.
We are clear that the regulation-making power represents the best approach to ensuring that all relevant actors are given due consideration by the adjudicator and that the requirements placed on the adjudicator can still be amended easily to respond to the ongoing needs of the sector and of the schools and the communities they serve. Importantly, we want to work with the sector to ensure that we have fully considered all relevant factors of concern when we develop the regulations to set out requirements on matters that the adjudicator must and must not consider when deciding on the published admission number of a school. That will ensure that the requirements on the adjudicator are clear and comprehensive.
The hon. Member for Harborough, Oadby and Wigston tabled amendment 83, which would remove from the Bill a delegated power to enable the Secretary of State to make regulations setting out factors that the adjudicator must and must not take into account when assessing the published admission number of a school or where they uphold a published admission number objection. That is relevant in the context of the hon. Member’s amendment 84, but, as I have tried to do in the discussion we have had—and as I would have already done if we had got to it—I will explain a little more our intentions for the regulation-making power and why we consider it the most appropriate way to address the issues raised in amendment 84.
It is important that the adjudicator, admission authorities and local authorities are all clear on what factors the adjudicator will take into account in her decision making, so that the decisions are made on a clear and transparent basis. In many cases, a school’s performance and parental demand for places, as the hon. Member for Harborough, Oadby and Wigston set out in amendment 84, will clearly be important factors for the adjudicator to consider when considering an objection to a school’s published admission number. However, as I have mentioned, there are many other important considerations, not just for the area but for the school itself, that must form part of the adjudicator’s decision making.
Let us be clear: these are difficult questions. They concern, for example, important matters such as the school’s capacity, the impact of the proposed admission number on the quality of education for children at neighbouring schools, and more practical matters such as compliance with regulations in terms of class sizes. Importantly, regulations to specify what the adjudicator must and must not take into account will ensure that any relevant impacts on the admission authority and school that are the subject of the objection are given due consideration before the adjudicator decides on the published admission number.
The complexity of the factors is best set out in regulations to ensure that they remain flexible and responsive to changes in any related legislation and in the wider context. For example, if we want to ensure that adjudicators take account of a school’s need to comply with infant class-size regulations, we want to be able to respond to any changes to those regulations. Similarly, if future demographic changes mean it is important for the adjudicator to think about how they consider issues such as a school’s capacity, regulations can be amended to ensure that the adjudicator takes into account all relevant considerations at that time and is not bound by outdated rules.
The regulations, and any changes to them, will be subject to parliamentary scrutiny. Including these matters in regulations will ensure that, if necessary, we can respond quickly to feedback from the sector, and where wider circumstances change, while ensuring that a clear level of rigour and parliamentary oversight can still be achieved. Given the argument I have set out, I respectfully ask the hon. Member for Harborough, Oadby and Wigston not to press his amendments.
Clause 50 provides that where the adjudicator upholds an objection to a school’s published admission number, it can specify the new PAN, which must then be included in the school’s admission arrangements. That is vital to ensure that all communities have the places they need so that children can access a local school where they can achieve and thrive.
Broadly, the ability of admission authorities to set their published admission numbers works well. In many areas, published admission numbers work effectively, and admission authorities and local authorities co-operate well to support local need. The hon. Member for Harborough, Oadby and Wigston has a concern about the clause’s impact on the ability of good schools to expand through an increase to their published admission numbers; I reassure him that the Government are absolutely in favour of good schools expanding where that is right for the local area.
David Baines (St Helens North) (Lab)
The Minister just mentioned areas where schools already collaborate well with local authorities, and I am pleased to say that St Helens is one of those areas. From my experience as council leader before coming here, and since then as a Member of Parliament, I am aware that maintained schools and academies work together collaboratively very well, both with each other and with the local authority. Does the Minister agree that the clause is simply about ensuring that that remains the case and that local authorities have the support they need to ensure that local schools work for local families?
Catherine McKinnell
My hon. Friend makes a really important point. The focus here has been on where it goes wrong, but actually, in the vast majority of cases, local authorities are collaborating well, because fundamentally everybody has the same goal, which is to provide an education that enables children to achieve and thrive. That needs to be delivered for every child in a local area, and clearly that is what this legislation is intended to achieve.
Where local authorities need more places in an area, we and they would clearly encourage high-performing schools to work in collaboration with local authorities to meet that need. However, where admission authorities act unilaterally, without recognising the needs of or impact on their local communities, that can cause problems, not just for local authorities or neighbouring schools but, ultimately, for children and parents.
In some areas, local authorities struggle to fulfil their responsibility to ensure sufficient school places, because the published admission numbers set by individual admission authorities do not meet local needs, despite there being physical capacity in schools. In other areas, schools are increasing their admission number beyond what is needed, risking damage to the education that children receive at nearby schools by making it harder for school leaders to plan the best education for their children. In the worst-case scenario, it could lead to perfectly good schools becoming unviable and therefore reduce choice for parents.
Where agreement cannot be reached locally, and a local authority or another body or person brings an objection to a school’s published admission number to the schools adjudicator, the adjudicator must, as now, come to their own independent decision as to whether to uphold the objection, taking into account the views of all parties, the requirements of admissions law and the individual circumstances of the case. It is important to note that the measure does not enable local authorities to directly change the published admission number of any school for which it is not the admission authority. The adjudicator, not the local authority, is the decision maker and they will take an independent and impartial decision. The provisions of clause 50 ensure that where they uphold an objection to a school’s published admission number—
Damian Hinds
So it is not the local authority; it is the adjudicator. I am wondering, as we are talking about serving communities, where the line of democratic accountability is.
Catherine McKinnell
The right hon. Gentleman is perhaps questioning the very long-standing process—it has been in existence for quite some time—for the role of the adjudicator in making these decisions where it cannot be decided within a local authority area on a collaborative basis. Obviously, the ideal situation is that local authorities and all the schools within the area are able to co-operate and collaborate to ensure that any individual admission number is set at the right level for the local community, taking into account the broader context. There is clear democratic accountability in that. Where that process breaks down, the adjudicator is there to be an independent arbitrator. Those requirements are set out in law; the framework that they work to and the factors that they consider are set out in guidance that is subject to parliamentary scrutiny. It is clear and transparent, and the adjudicator is bound by the laws in that case.
Catherine McKinnell
Does the right hon. Gentleman mind if I just finish? It may answer his question.
In the instances I just described, the powers in the clause provide a direct route for an independent decision, resulting in a clear outcome for parents, admission authorities and local authorities.
Damian Hinds
I am grateful to the Minister for giving way. I do mean these questions genuinely, in the spirit of line-by-line scrutiny of the Bill and trying to ascertain unintended consequences, intent and so on. If the adjudicator now has responsibility for ensuring that the number of school places in an area is what is needed and is fair, does the adjudicator also have a say in allowing a school to open?
Catherine McKinnell
It is the local authority that has the responsibility to agree published admission numbers with the schools in its area. Obviously, academies are their own admissions authority, and will set their own published admission number. The adjudicator becomes involved in the decision making where appeals are made to a school’s chosen published admission number. The adjudicator is then required to come to a decision, based on a very clear framework of factors to consider, as to whether the published admission number is fair in the context of the particular school and the local community. What was the right hon. Gentleman’s specific question?
Damian Hinds
Does the adjudicator also have a say in allowing a school to open?
Catherine McKinnell
I cannot envisage a scenario where an adjudicator would adjudicate on the opening of a new school. If it adjudicates on the published admission numbers of existing schools, I cannot foresee a scenario where there would be an appeal to the adjudicator for a school that does not exist.
Neil O’Brien
If I can put it in my words, there is nothing in the Bill to stop the local authority applying to the adjudicator to stop the first year PAN of a new school. If I say, “I want to open my new school and the PAN is going to be X,” the local authority could say, “No, I think it should be half of X.” There is nothing to stop that, even in the first year. It could even be that the local authority says, “No, the first year number should be zero.” There is nothing in the Bill to stop that happening, so, as my right hon. Friend the Member for East Hampshire says, it does apply to new schools.
Catherine McKinnell
I apologise, but I still do not see the relevance to how an adjudicator could open a new school. I am more than happy to write to the hon. Gentleman after I have considered the issue further.
Damian Hinds
It may help if I say why I asked the question. The adjudicator will be worrying, “I need to make sure that a school over here isn’t creating unfairness or making another school unviable because there are too many school places in this area.” If someone else comes along and says, “I’m going to open a new one,” that will make the school even more unviable. Logically, if I am the adjudicator and the Government are tasking me with making sure that we are not making schools unviable, surely I should be able to veto a new school coming into the community.
Catherine McKinnell
I thank the right hon. Gentleman for that clarification. It is not that the adjudicator makes the decision about whether to open a new school, which is how the question was originally posed. The right hon. Gentleman is talking about the hypothetical outcome that the adjudicator’s involvement in a decision could result in—
Damian Hinds
No, I am asking directly: could the adjudicator stop a new school opening on the grounds that we have tasked the adjudicator with making sure that there is not excess capacity in an area, which might make one or more schools unviable? Logically, surely the adjudicator ought to be able to stop the problem getting even worse—in the eyes of Ministers—by refusing a new school opening.
Catherine McKinnell
I will have to take away that question, and I am happy to write to the right hon. Gentleman with a response. Obviously, the adjudicator currently has a role in certain cases—for example, where a local authority is involved in the foundation of a school. I will look at the specific example that he raises, and I am happy to write to him with a response.
Neil O’Brien
I am extremely grateful to the Minister for her offer to write on this point. To avoid disturbing her flow any further, can I ask her to explain something? If a school is not happy with the decision of the adjudicator on its PAN, what will the appeal process look like for that school?
Catherine McKinnell
Adjudicators’ decisions are legally binding and publicly available. Ultimately, adjudicators are appointed by the Secretary of State, who is accountable for those decisions. That responds to the question from the right hon. Member for East Hampshire about democratic accountability.
I presume that the outcome in the case that the hon. Member for Harborough, Oadby and Wigston raises would be a legal challenge to the decision. Obviously, he and the right hon. Member for East Hampshire are testing the possible outcomes of this measure to the very limit, which comes across as rather extreme in most cases. The purpose of the clause is to simplify, clarify and make more transparent the levers that local authorities will have to set planning numbers in their area, ideally to reduce the number of challenges and issues that arise.
Munira Wilson (Twickenham) (LD)
Other than the Government Whip, the hon. Member for Lewisham North, I am the only London MP in the room. There has been a lot of discussion about London schools and the challenges that we have, and one of the reasons why I have been listening quietly is that I have a lot of sympathy for both sets of arguments that have been put forward.
I want to pick up on the point about new schools opening in areas where there may already be surplus capacity. In defence of the right hon. Member for East Hampshire, I do not think that this issue is just theoretical. I talked to a director of children’s services about a borough —it neighbours the one containing my constituency—where there is already a funding application in the pipeline for a new free school. At the same time, an academy has just decided to expand its PAN. That director of children’s services was saying, “Actually, I welcome the duty to co-operate,” but it throws up the question posed by the right hon. Member for East Hampshire: would the adjudicator urge Ministers to turn down the application for the free school because an existing academy is already expanding its PAN? I do not say that to make a political point; it is a genuine question that will need some clarity from Ministers, albeit subsequent to this debate.
Catherine McKinnell
I appreciate that the hon. Lady refers to a real potential scenario, although I would certainly put it in the hypothetical category at this stage. The Office of the Schools Adjudicator can only take a decision where there has been an objection. That is the point I was making. It cannot decide whether to open a school; it can take a decision only where an objection is made specifically to the adjudicator on the basis of the proposed published admission number.
Subject to the passing of this Bill, new school proposals put forward by the local authority outside the invitation process—I do not believe we have got to those clauses yet; we are coming to a whole additional debate on that—will be decided by the schools adjudicator, to avoid any conflict of interest and to ensure that any objections to the proposals are considered fairly. Obviously, it will have the legal framework within which to operate in order to make those decisions. That is an established part of the current system.
For other possible scenarios, we will provide guidance on the factors that we expect decision makers to take into account in the variety of decisions that may be required. That will be based on the existing guidance for opening new schools and will include the vision for the school, whether it is deliverable and affordable, the quality of the education, the curriculum and the staffing plans. Those are all the factors taken into account when determining the opening of a new school.
However, I appreciate the challenge on published admission numbers, in particular, being a factor to be taken into consideration. As I said, I will confirm in more detail how that might work in practice, but the fundamental point is that it will be set out in guidance. If there is a challenge to a decision by an adjudicator, that will be by way of judicial review.
Moving on, new clause 46, tabled by the hon. Member for Harborough, Oadby and Wigston, seeks to ensure that where high-performing schools, as defined in his new clause, wish to increase their published admission number, their admission authority must reflect that in the determined admission arrangements. I can reassure him that, as I have said already, this Government support good schools expanding where that is right for the local community. We understand the importance of admission authorities being able to set their own admission arrangements, including their published admission number.
Admission authorities will consider a variety of factors in arriving at the most appropriate number for their schools and must consult where they want to make changes, taking the feedback into account before they make their final decision. Where, for example, a multi-academy trust or local authority is setting the PAN for an individual school for which it is the admission authority, it is right that it takes into account the views of that school, but that can be done by informal engagement or by a formal consultation process if necessary.
The school admissions code requires governing bodies to be consulted on changes to a school’s admission arrangements where they are not the admission authority. However, that does not mean that those views should override any relevant factors, such as budgeting or staffing, that a trust, governing body or local authority, as the school’s admission authority, may need to take into consideration as part of its final decision.
If the school feels that it has not been heard and the admission authority has reduced the published admission number where the school feels it should be able to offer more places, it would be open to the school itself, like any other body or person, to object to the adjudicator for an independent resolution. We expect most issues to be resolved locally, through engagement and collaboration, and, given the existing, effective routes for schools to influence the published admission number set for them by the local authority, we do not think the new clause is necessary. For the reasons I have outlined, I would ask the hon. Gentleman not to press it.
Finally, I turn to new clause 47, tabled by the hon. Member for Harborough, Oadby and Wigston, which would prevent objections from being made against an admission authority where it proposes to increase its PAN or keep it the same as the previous year. Through clause 50 we want to ensure that the number of places on offer in an area adequately reflects the needs of the local community. As the hon. Member is aware, at present, any body or person can object to the adjudicator about a school’s determined admission arrangements, including the school’s PAN. However, current regulations have the same effect as his new clause of preventing objections where a PAN is increased or retained at the same level as the previous year. We intend to amend those regulations to allow the local authority to object to the adjudicator where a PAN has been increased or has stayed the same as in the previous year. This is intended to facilitate the measures set out in clause 50 to provide a more effective route for local authorities to object to the independent adjudicator about a school’s PAN.
The current circumstances in which the system operates are complex. In some areas there is a surplus of places, whereas in others, some admissions authorities are not offering sufficient places to ensure that all children can access a local school That means that both PAN increases and decreases can impact on the local school system in different ways, and that even where a school’s PAN has not changed from previous years, changing demographics can mean that that number no longer meets the needs of the local area. However, local authorities often lack the levers to deliver on their duty to ensure that there are sufficient school places, or to manage the school estate effectively. So, if the PAN does not work in the interests of the local community, the local authority should be able to object to the adjudicator, regardless of whether the school intends to increase, decrease or keep the same PAN, and that will ensure fairness and the most appropriate decision on the allocation of places.
Our proposed changes reflect local authorities’ important role in ensuring that there are sufficient places, and that the number of places offered in an area meets the needs of the community. That is why we are proposing a limited change to the regulations to lift this restriction only for local authorities, not for all bodies or people. The route of objection will be a last resort for local authorities. We expect local authorities and schools to work together to set PANs that are appropriate, and we will update the school admissions code to support that.
As the House has previously confirmed in passing the relevant regulations, the flexibility of the current regulations has worked well, enabling the Government of the day to be responsive to changing circumstances in the interests of parents and communities. New clause 47 would prevent the Government from exercising the flexibility provided for by the existing legislative framework, leaving local authorities with limited ability to act in the interests of the local community and seek an independent decision on the PAN of a school where they consider it does not meet the community’s needs. The changes that the Government propose to make to the regulations will of course be subject to parliamentary scrutiny.
In the light of those arguments, I respectfully ask the hon. Member for Harborough, Oadby and Wigston to withdraw his amendment, and I commend clause 50 to the Committee.
Neil O’Brien
I pay tribute to the Minister for the reasonable way in which we have conducted this important debate. We have a huge disagreement with clause 50, which we think is a major mistake. We also have concerns about the process. We believe that it is better for this House to debate these big issues about what fairness is and looks like, and for that to be dealt with through the transparency of primary legislation, rather than its being left to the Secretary of State at any given moment to pass these things in regulations. I am therefore keen to press amendment 84 and new clause 46 to a vote.
Question put, That the amendment be made.
Crown Estate Bill [ Lords ] (First sitting)
Thursday 6th February 2025
(1 day, 14 hours ago)
Public Bill CommitteesRead Full debate Crown Estate Bill [HL] 2024-26 View all Crown Estate Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 6 February 2025 - (6 Feb 2025)
The Committee divided: - Ayes: 3 / Noes: 9 - Question accordingly negatived.
The Chair
Will everyone ensure that all electronic devices are turned off or switched to silent mode. We now begin line-by-line consideration of the Bill. No food or drinks are permitted during sittings of the Committee, except for the water provided. Hansard colleagues would be grateful if Members could email their speaking notes to hansardnotes@parliament.uk or, alternatively, pass their written notes to them in the room.
The selection list for today’s sitting is available in the room and on the parliamentary website. It shows how the clauses and selected amendments have been grouped for debate. The Member who has put their name to the lead amendment in a group will be called to speak first; in the case of a stand part debate, the Minister will be called first. Other Members are then free to indicate that they wish to speak by bobbing which, as you all know, means standing up in your place.
At the end of a debate on a group of amendments and new clauses, I shall call the Member who moved the lead amendment or new clause again. Before they sit down, they will need to indicate whether they wish to withdraw the amendment or the new clause or to seek a decision. If any Member wishes to press any other amendment or new clause in a group to a vote, they will need to let me know. I hope that explanation is helpful.
Finally, I remind Members about the code of conduct relating to registered interests. If any Members wish to declare an interest, they should do so now. As there are no interests, I will call the Minister to move the programme motion standing in his name, which was discussed yesterday by the Programming Sub-Committee for the Bill.
Ordered,
That—
1. the Committee shall (in addition to its first meeting at 11.30 am on Thursday 6 February) meet at 2.00 pm on Thursday 6 February and 9.25 on Tuesday 11 February;
2. the proceedings shall (so far as not previously concluded) be brought to a conclusion at 11.25 am on Tuesday 11 February.—(James Murray.)
Resolved,
That, subject to the discretion of the Chair, any written evidence received by the Committee shall be reported to the House for publication.—(James Murray.)
Clause 1
Power of Crown Estate Commissioners to borrow etc
James Wild (North West Norfolk) (Con)
I beg to move amendment 4, in clause 1, page 1, line 26, at end insert—
“(3) The Chancellor of the Exchequer must limit borrowing by the Crown Estate under this section by regulations made by statutory instrument, and these regulations may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.
(4) The first set of regulations made under subsection (3) must limit borrowing to a net debt to asset value ratio of no more than 25 per cent.”
This amendment would limit the amount the Commissioners may borrow by regulations subject to the affirmative procedure for statutory instruments.
The Chair
With this it will be convenient to discuss the following:
Amendment 7, in clause 1, page 1, line 26, at end insert—
“(3) The Treasury must by regulations limit borrowing to a net debt to asset value ratio of no more than 25 per cent.
(4) A statutory instrument containing regulations under subsection (3) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”
This amendment would limit the amount the Commissioners may borrow by regulations.
Clause stand part.
James Wild
It is a pleasure to serve under your chairmanship, Ms Furniss, and to get the Committee started this morning. The clause amends the Crown Estate Act 1961 to remove certain statutory restrictions on the commissioners’ powers, and it clarifies and expands those powers in certain respects. Specifically, it broadens the Crown Estate’s investment powers and confers a broader power to borrow, subject to Treasury consent.
As well as moving the amendment, I will speak to the clause. The Crown Estate Bill was conceived under the previous Government, and I am pleased that it has now progressed to this stage. We support the objective of the clause, which is to increase the Crown Estate’s ability to compete and invest, so that it maintains and enhances the value of the estate and the income derived from it.
As the Committee knows, assets managed by the Crown Estate are not the property of the Government, and nor are they part of the sovereign’s private estate. Since George III, the assets have been held in right of the Crown—in other words, they are owned by the Crown as an institution, not personally by the monarch. The concept of the Crown encompasses the interests of both the sovereign and the Government. That is why appropriate scrutiny of the Crown Estate is important. The Estate has assets worth £15.5 billion and a portfolio of 185,000 acres, and it manages roughly 7,400 miles of coastline. It is also the largest contiguous owner in the west end.
The Crown Estate returns all its net profits to the Treasury. In 2023-24, it recorded a net profit of £1.1 billion. Over the past decade, it has generated £4.1 billion for the nation’s finances, which is a laudable record, but there is the potential to do more. The Crown Estate estimates that the changes in the clause will enable it to generate £100 million per annum in additional revenues to the Treasury by 2030. That is forecast in the original business case that led to this legislation. It is therefore right that we should help to modernise the Estate as it aims to create lasting prosperity for the nation.
At present, the Crown Estate is limited to making investments in certain types of property and certain restricted types of security held on the Crown Estate’s behalf by the national debt commissioners. The Estate’s powers to borrow for the purposes of discharging or redeeming incumbrances affecting the Estate are very limited. The Bill will modernise the Estate by removing those limitations.
Although we support the borrowing power, we are concerned that there is a lack of parliamentary oversight over the borrowing levels. This is a new power. The Crown Estate should be prudent on the level of borrowing. The purpose must be supporting the Estate’s duty to maintain and enhance its value for maximised return to taxpayers. That is why we have tabled amendment 4, which would limit the amount the commissioners may borrow instruments. Specifically, the amendment would limit borrowing to a net debt-to asset value ratio of no more than 25% initially.
When pushed by Baroness Vere and other noble Friends in the other place, the Government stated that a limit on borrowing is better placed outside legislation and that controls would be set out in the memorandum of understanding between the Crown Estate and the Treasury. On Second Reading, the Minister repeated that, saying:
“There will, as has been noted, be a memorandum of understanding in place between the Treasury and the Crown Estate, and that will govern how borrowing powers will be exercised.”—[Official Report, 7 January 2025; Vol. 759, c. 805.]
The target borrowing level in that MOU sets out that the loan-to-value ratio should not exceed 25%. Given that the Government agree that there should be a limit, we should introduce robust safeguards in statute to protect against unconstrained borrowing. An MOU between the Treasury and the Crown Estate is easily altered at the stroke of a pen. If Parliament is being asked to remove the restriction to allow the Crown Estate to borrow, I struggle to see the logic in why the Government think that the cap they have committed to should not initially be set in legislation, with the ability to amend it by secondary legislation, if necessary. I would be grateful if the Minister could address those concerns and confirm whether the Government have considered this proposal since Second Reading.
A limit must be subject to the affirmative procedure, which is a proportionate step that will ensure that the Crown Estate can access that borrowing to maintain and enhance the value of its land, property, and interests for the benefit of the nation. However, borrowing can be risky, and this is a new power, so it should be subject to some controls and we should be cautious. I contend that amendment 4 is a perfectly reasonable check on the borrowing power, and I hope we can get the Committee off to a positive start, with the Minister accepting it.
Pippa Heylings (South Cambridgeshire) (LD)
Amendment 7 is similar to amendment 4, and is supportive of its essence. It is about introducing a sensible borrowing limit for the Crown Estate commissioners by capping their net debt-to-asset value ratio at 25%, with any change to that limit requiring parliamentary approval.
As we have just heard, clause 1 as it stands grants the Crown Estate significant new powers to borrow and access financial assistance from the Treasury. Although investment in the Crown Estate’s portfolio—particularly in areas such as offshore wind—is welcome, it is vital that we ensure fiscal responsibility and protect the long-term value of these assets for the nation.
Amendment 7 is about introducing proper safeguards. The Crown Estate manages over £16 billion in assets, and its revenues contribute directly to the Treasury and public finances. Without a clear borrowing limit, we could risk unchecked debt accumulation, which could ultimately undermine the Estate’s financial sustainability and reduce the returns it provides to the Exchequer. A 25% debt-to-asset ratio is a reasonable cap and allows for investment and growth, but prevents excessive leveraging that could put the Estate’s finances at risk. Crucially, the amendment also ensures parliamentary oversight. Any changes to the limit must be debated and approved by both Houses, rather than left solely to the discretion of the Treasury.
This is not about preventing the Crown Estate from borrowing; it is about ensuring that borrowing is responsible, transparent and aligned with the long-term interests of the nation. Given the Crown Estate’s unique status and the importance of its revenues to the public purse, it is only right that Parliament retains a say over any significant increase in borrowing capacity. The amendment would only confirm assurances that were provided in the other House by Lord Livermore. In his work with Baroness Kramer, we were assured that there would be a cap on borrowing to 20% of the loan-to-value ratio in the updated framework agreement. Amendments 4 and 7 reflect those promises, and I urge the Government to support amendment 7 to safeguard the financial integrity of the Crown Estate and ensure that borrowing powers are used wisely and with proper oversight.
The Exchequer Secretary to the Treasury (James Murray)
It is a pleasure to serve on the Committee with you as Chair, Ms Furniss. I will turn to the amendments in a moment, but I will first briefly address why clause 1 should stand part, and what it would achieve in amending the Crown Estate Act 1961.
The clause amends the 1961 Act to clarify the powers of the commissioners and remove certain statutory restrictions in respect of borrowing. Those changes are central to the aims of the Bill, which are to modernise the Crown Estate and to remove limitations on investments, to ensure that it can meet its core statutory duties. Those duties—which it is right for the Crown Estate to pursue in the national interest—are to maintain and enhance the value of the estate and the returns obtained from it.
The Crown Estate is a commercial business, independent from Government, that operates for profit and competes for investment. However, limitations placed on it by the Crown Estate Act 1961 currently risk its ability to compete and invest most effectively, meaning that it is less able to deliver returns for the public purse than it might otherwise be. The clause therefore makes two main changes.
First, the clause clarifies the investment powers of the Crown Estate commissioners by expressly conferring powers that are currently implicit in the 1961 Act. That ensures that the commissioners have the power to do anything that is designed
“to facilitate, or is conducive or incidental to,”
discharging their statutory duties, including their core duties to maintain and enhance the value of the estate. The clause also removes restrictions on the commissioners’ powers to invest.
Through those broader investment powers, the Crown Estate will have greater flexibility to invest in new growth opportunities—for example, in digital technologies, to support the acceleration of offshore energy through digital mapping of the seabed. These broader powers will also unlock the Crown Estate’s ability to under de-risking activities, such as surveys and grid co-ordination, which will increase the frequency of offshore wind leasing and support the clean energy mission.
Secondly, clause 1 inserts a proposed new section into the 1961 Act that would grant the Crown Estate the power to borrow out of the national loans fund via the Treasury, or otherwise subject to Treasury consent. It also authorises the Treasury to provide financial assistance to the commissioners. That change will unlock the Crown Estate’s ability to compete more effectively, by enabling it to borrow as its competitors currently can.
The clause has been carefully drafted to include the requirement for Treasury consent prior to the Crown Estate accessing debt. That strong safeguard will ensure that borrowing is carefully considered and controlled. Furthermore, as borrowing will be from Government at commercial rates, the interest paid by the Crown Estate will outweigh the cost to Government of the borrowing.
Any borrowing undertaken by the Crown Estate will be for investment in activities that will drive increases in its revenues, thereby also increasing the profits it generates and provides to the Government, which will help to provide funding for our public services. That will be a net benefit to the public finances, and builds on the Crown Estate’s long track record of delivering significant returns to the public purse year after year. As the shadow Minister mentioned, that has totalled more than £4 billion in the last decade.
I will now turn to amendments 4 and 7, which were tabled by the hon. Members for North West Norfolk and for South Cambridgeshire respectively. The amendments would place a legislative limit on borrowing, through regulations, but it is the Government’s view that limits on borrowing are best set outside of legislation. For that reason, a limit will be set in the memorandum of understanding between the Treasury and the Crown Estate, with the cap set at no more than a 25% net debt-to-asset value ratio. That document has been made available in draft to aid the House in its scrutiny.
The primary safeguard built into the Bill is the requirement for Treasury consent. We are also retaining the requirement for the Crown Estate to maintain and enhance the value of the estate, while having
“due regard to the requirements of good management”,
as set out in the 1961 Act. Taken together, those elements provide clear guardrails and strengthen the important fiduciary duty of the commissioners not to take decisions that could endanger the estate or compromise its core duties.
To underscore the point—given that the two Opposition Members raised questions about this—the Bill is clear that any borrowing undertaken by the Crown Estate can only be from the Treasury or otherwise with Treasury consent. The Treasury will, of course, ensure that any borrowing is consistent with our wider fiscal rules. Therefore, in addition to the requirement to secure Treasury consent, the draft memorandum of understanding between the Treasury and the Crown Estate sets out additional guardrails. For instance, it says that the borrowing should “target a sustainable range”, and is “not to exceed 25%” of the
“Loan to value ratio (defined as the ratio of net debt to asset value”
As with any public sector borrowing, the Treasury will ensure that this is consistent with managing public money principles, to ensure value for money from the taxpayer. On that basis, I hope hon. Members will not press their amendments.
James Wild
I am disappointed to hear the Minister’s response. He did not quite address the point that an MoU —I appreciate that he has provided a draft to the Committee—can simply be changed if Ministers and the Crown Estate decide they want to change the level. Only in the last week or so, we have passed into law the charter for Budget responsibility, setting out the Government’s fiscal rules in statute, so I am not sure why there is an in-principle objection to setting out such borrowing in legislation. I think that that would be a prudent step, as we and the Crown Estate embark on a new period with this borrowing power. I will therefore push my amendment to a vote.
Question put, That the amendment be made.
James Wild
I beg to move amendment 5, in clause 2, page 2, line 11 at end insert—
“(5A) The Commissioners must notify the Chancellor of the Exchequer of any proposed changes to the remuneration framework governing remuneration of the Chief Executive set out in the Framework Document.
(5B) The Chancellor of the Exchequer must lay before Parliament any notification received under subsection (5A).”
This amendment requires Commissioners to notify the Chancellor of the Exchequer of any changes to the remuneration of the Chief Executive, who must lay that notification before Parliament.
James Wild
The clause amends schedule 1 to the Crown Estate Act 1961. Specifically, it will increase the number of commissioners from eight to 12 and require them to be paid out of the returns generated by the Crown Estate, rather than out of money provided by Parliament, as is the case currently.
Clause 2 is intended to bring the Crown Estate’s operating practice in line with best practice for corporate governance. Subsection (2) seeks to provide the flexibility to allow the board to include a combination of executive and non-executive directors, to reflect its increasingly diverse activities. Subsection (2) also removes the requirement for the second Crown Estate commissioner—a post currently held by the chief executive—to be the deputy chairman. This measure seeks to satisfy best practice standards, whereby the roles of chairman and chief exec should not be exercised by the same person.
We are supportive of the changes, and I put on record again my thanks to Baroness Vere of Norbiton for pushing the Government to give assurances that the chair of the Crown Estate commissioners could be added to the Cabinet Office’s pre-appointment scrutiny list. I understand that we are waiting for the Treasury Committee to set a date for the pre-appointment hearing for Ric Lewis. Subsection (3) requires the salaries and expenses of the commissioners to be paid out of the returns of the estate to reflect the Crown Estate’s commercial freedom and function, and to place the commissioners in a position that is more consistent with general commercial practice.
I turn now to amendment 5, which is tabled in my name. As I have set out, as well as modifying the governance, clause 2 alters the way in which the commissioners are paid. Parliament will no longer need to approve the salaries and expenses of the commissioners and their staff. However, I believe that some form of parliamentary oversight is needed. At present, the estimate details supply finance and is voted on by Parliament at the beginning of the financial year. Amendment 5 would simply require the commissioners to
“notify the Chancellor of the Exchequer of any proposed changes to the remuneration framework governing remuneration of the Chief Executive set out in the Framework Document.”
The Chancellor of the Exchequer would then be required to lay before Parliament any such notification.
Currently, the remuneration policy and framework for the Crown Estate’s staff is the responsibility of the board’s remuneration committee, and the framework document states:
“The Committee will share any planned changes to the remuneration framework with HM Treasury to seek their agreement.”
Given that Parliament will no longer be needed to approve the salaries, does the Minister agree that it would be sensible to ensure that Parliament is at least notified of any changes to the remuneration policy that affect the chief executive?
At present, the framework document sets out that the
“maximum remuneration of the Chief Executive should be in line with or below that of the lower quartile of an appropriate benchmark group agreed with HM Treasury.”
It also states that
“the clear majority of the Chief Executive’s total reward package should be conditional upon performance, with a significant element of that conditional upon long term performance”,
given the Crown Estate’s primary duty. The Opposition support rewarding success and the delivery of targets, but any such changes to the policy should be considered by Parliament.
On Second Reading, the Minister said:
“As the Crown Estate is statutorily an independent, commercial organisation, which returns hundreds of millions of pounds in profit to the Exchequer every year, continuing the success is crucial and it requires the organisation to have the freedom to compete for the top talent in the commercial world.”—[Official Report, 7 January 2025; Vol. 759, c. 805.]
We absolutely agree on that, but I struggle to see how ensuring that Parliament is simply notified of changes to the chief executive’s pay policy will restrict the Crown Estate’s ability to compete for top talent. It is about transparency, and it would simply provide much-needed scrutiny to a process for which there is currently parliamentary oversight, given the statutory purpose of the Crown Estate. I would welcome support for our amendment, and I look forward to the Minister’s response.
James Murray
I will turn to amendment 5 in a moment, but I will begin by briefly setting out what clause 2 seeks to achieve. The clause makes changes to the Crown Estate’s governance to bring the Crown Estate’s constitution in line with best practice for modern corporate governance. The clause makes three changes, which I will deal with in turn.
First, the clause increases the maximum number of commissioners on the Crown Estate’s board from eight to 12. That will provide the Crown Estate with the flexibility it needs to satisfy best practice standards for modern corporate governance. For example, the change will allow the Crown Estate’s board to include a wider combination of executive and non-executive members, both to reflect its increasingly diverse and wide-ranging activities and to enable it to adopt appropriate committee structures.
However, I assure the Committee that although we are increasing the number of commissioners, we are not changing the way in which they are appointed to the role, except for the new commissioner roles introduced by clause 6. The exact number and the respective roles of the commissioners within that new maximum will remain subject to the public appointments process. As such, additional commissioners will be appointed by the King on the recommendation of the Prime Minister, as is usual practice. That also includes the new commissioners with special responsibility that we will consider in our debate on clause 6, for which there will also be a process of consultation with the relevant devolved Government. The chair will face additional pre-appointment scrutiny, as the Financial Secretary confirmed in the other place.
Secondly, the clause removes the requirement for the second Crown Estate commissioner, a post currently held by the chief executive, to be deputy chair. This change will align the Crown Estate with best practice standards that set out that the roles of chair and chief executive should not be exercised by a single individual.
Thirdly, the clause will require the salaries and expenses of the commissioners to be paid out of the return obtained from the Crown Estate, rather than out of money provided by Parliament, which is the current position. Changing the source of funding for commissioner salaries is intended to demonstrate more clearly the relationship between the relevant expenditure and Crown Estate income, while also reflecting the Crown Estate’s commercial functions. However, the pay of the chair and other non-executive commissioners will continue to be set by Treasury Ministers. In line with the UK corporate governance code, that will not include any performance-related element.
Lincoln Jopp (Spelthorne) (Con)
Clearly, the highest standards of independence and probity will be required of the chair in order to execute their duties, particularly given that we have not brought back to Parliament the ability to raise debt on the assets of the Crown Estate. I feel duty bound therefore to ask the Minister whether he is aware of media reports that the Chancellor’s preferred candidate for chair is a recent Labour party donor who gave £15,000 to the Labour party in 2023 and £30,000 to the Foreign Secretary. It is not unreasonable of the shadow Minister’s amendment to seek that level of transparency by asking for any future changes to salaries for chairs to come back to Parliament.
James Murray
The hon. Member asks about the amendment tabled by the hon. Member for North West Norfolk, to which I was just about to turn. If he will allow, I will address the amendment and that will answer at least some of the questions he raises in his intervention.
Amendment 5 would require the commissioners to notify the Chancellor of the Exchequer of any proposed changes to the remuneration framework for the chief executive set out in the framework document and for such notification to be laid before Parliament by the Chancellor. I will set out the current arrangements on remuneration for the chief executive of the Crown Estate.
How the chief executive is paid is a matter for the Crown Estate’s board in the first instance. However, the pay is set with reference to the agreement between the Treasury and at a level that is at the lower end of the Crown Estate’s comparable peers, reflecting the national significance of the organisation. The framework document between the Crown Estate and the Treasury is clear that the Crown Estate
“will share any planned changes to the remuneration framework with HM Treasury to seek their agreement.”
I think that very much delivers on the spirit of the amendment.
The Crown Estate’s annual report and accounts already include as a matter of course a comprehensive report on remuneration and details of the chief executive’s pay. Taken together, those arrangements already deliver on the essence of the amendment and I hope that, with that explanation, the hon. Member for North West Norfolk will feel able to withdraw the amendment.
The primary intention of the Bill is to modernise the Crown Estate and ensure that it is best able to operate in a modern, commercial environment. These changes are central to that aim.
James Wild
I am grateful for the contributions on this point and for the Minister’s response. I have read the framework agreement closely. At the moment, the Crown Estate will notify the Treasury of changes and ultimately the Treasury will come to Parliament through the estimates process to approve the pay, based on that policy.
What is going to change is that the Crown Estate will be paying from within the income it generates. While the Treasury may still know that there has been a change, no one else will necessarily know. Although I take the point that the annual report will detail any changes, there will be a lag—the policy could have been in place for some time before that happens.
Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
I beg to move amendment 1, in clause 3, page 2, line 17, at end insert—
“(3B) In keeping the impact of their activities under review, the Commissioners must have regard to—
(a) the United Kingdom’s net zero targets;
(b) regional economic growth; and
(c) ensuring resilience in respect of managing uncertainty, risk and national security interests.”
This amendment would require the Crown Estate Commissioners, in reviewing the impact of their activities on the achievement of sustainable development, to have specific regard to the United Kingdom’s net zero targets, regional economic growth, and resilience in respect of managing uncertainty, risk and national security interests.
The Chair
With this it will be convenient to discuss the following:
Amendment 6, in clause 3, page 2, line 17, at end insert—
“(3B) In complying with the duty under subsection (3A), the Commissioners must—
(a) set and publish sustainable development objectives in relation to their activities,
(b) take all reasonable steps to meet these objectives, and
(c) have regard to the relevant environmental legislation for the UK, England, Wales and Northern Ireland in relation to making these objectives.
(3C) For the purposes of subsection (3B), ‘relevant environmental legislation’ includes—
(a) the Climate Change Act 2008,
(b) the Environment Act 2021,
(c) the Well-being of Future Generations (Wales) Act 2015, and
(d) the Environment (Wales) Act 2016.”
This amendment would require the Commissioners to set sustainable development objectives for their activities, having regard to the Climate Change Act 2008, Environment Act 2021, Wellbeing of Future Generations (Wales) Act 2015 and the Environment (Wales) Act 2016.
Amendment 8, in clause 3, page 2, line 17, at end insert—
“(3B) Any framework document published by the Chancellor of the Exchequer, the Crown Estate and the Commissioners must define ‘sustainable development’ for the purposes of this Act.
(3C) The definition under subsection (3B) must include reference to a climate and nature duty.
(3D) A ‘climate and nature duty’ means a duty to achieve any targets set out under Part 1 of the Climate Change Act 2008 or under sections 1 to 3 of the Environment Act 2021.”
This amendment would ensure that this act’s Framework Agreement must define “sustainable development”, and that the definition must include reference to a climate and nature duty.
Melanie Onn
It is a pleasure to serve under your chairmanship, Ms Furniss, and to speak to this amendment. Its intention relates to the additional funds that the Crown Estate will be able to unlock—something I welcome to improve investment in the country, rather than it being tied up by coming back into the Treasury to then be redistributed. It aims to ensure that there is an arrangement for funding from the Crown Estate, in projects and activities that it is already engaged in, to support the local regions where those are taking place.
It does not seem to me unreasonable that consider- ation should be given, as part of the Crown Estate’s considerations, to the UK’s net zero targets, as is expected of other organisations. Net zero is one of Government’s key missions, so to have some sympathy and some similarity in the way that organisations are expected to conduct themselves in relation to their overall objectives seems straightforward.
The amendment also adds the gentlest of additional check-ins for the Crown Estate to ensure that those wider community benefits that have the opportunity to generate lasting change in coastal communities are part of the Crown Estate’s considerations. There are so many benefits from this Bill—it is very welcome for that reason—and they should be specifically included.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
The Crown Estate, until now, has made decisions on the leasing of the seabed based mainly on price and cost and nothing else. This Bill will change that by asking commissioners to “keep under review the impact of their activities on…sustainable development”.
Amendment 1 simply clarifies “sustainable development” and slightly expands on what that means for, for example, net zero targets and economic growth. I ask the Minister to consider that and to assure us that that is what the Bill is intended to do, and that it will be the progress and direction of the Crown Estate.
Llinos Medi (Ynys Môn) (PC)
It is a pleasure to serve under your chairship. Ms Furniss. I rise to speak to amendment 6, tabled in my name. The amendment would amend clause 3, which relates to the regard of sustainable development that the Crown Estate commissioners must have when undertaking their activities. It would require the commissioners to set sustainable development objectives for their activities and require them to have regard for UK-wide legislation, such as the Climate Change Act 2008 and the Environment Act 2021. I note that is also the intention of amendment 8.
In addition, amendment 6 would require regard for devolved legislation in England, Wales and Northern Ireland. For Wales, that would include the Well-being of Future Generations (Wales) Act 2015 and the Environment (Wales) Act 2016. Shockingly, child poverty in Wales is set to reach its highest rate in 30 years by the end of this decade, with more than 34% of children living in low-income families. That is 5% up on the current rate, and means that around 32,000 more children in Wales could be pushed into poverty.
The activities of the Welsh Crown Estate could be geared towards helping to address rising child poverty by having regard to the seven wellbeing goals of the Well-being of Future Generations (Wales) Act, such as to develop a more equal, prosperous and resilient Wales. More broadly, this amendment draws inspiration from measures within the Scottish Crown Estate Act 2019, which legislates to ensure that management of the Scottish Crown Estate’s assets is done so that it is likely to contribute to economic development, regeneration and social and environmental wellbeing.
The Crown Estate manages a huge amount of land and natural assets. It is only right that it works with existing devolved legislation across all nations to meet sustainable and wellbeing goals, and to do so by fulfilling clear objectives. I urge the Government to incorporate this aim into the Bill.
Pippa Heylings
I will speak to amendment 8, which is similar to amendment 6. It would strengthen clause 3 by ensuring that sustainable development is properly defined within the Crown Estate’s framework document and that this definition explicitly includes a climate and nature duty.
The Crown Estate plays a pivotal role in the management of our land, seas and natural resources. It is well known for its ambition around nature recovery. It is a key player in our offshore wind expansion, biodiversity conservation and sustainable land management, but in areas in which there are multiple competing uses and values, including fishing, marine protected areas, and even highly protected marine areas. Therefore we need reassurances, as were obtained in the other House, that clause 3 does not just require commissioners to keep under review their impact on sustainable development without clearly defining what that means in practice.
I must acknowledge where this amendment started in life, which is with Baroness Hayman’s work in the other House. After much debate, it was agreed that sustainable development must be kept under review by the commissioners, but with a reference to the framework document in which a definition would be provided. Baroness Hayman said:
“What matters is the impact we have and how much we have shifted the dial in terms of what the Crown Estate achieves in support of the Government’s climate and nature objectives.” —[Official Report, House of Lords, 5 November 2024; Vol. 840, c. 1448.]
This amendment seeks to provide clarity and accountability for what was agreed verbally in the other House—that the definition would not be on the face of the Bill, but would be in the updated framework agreement. We need that to ensure there is a consistent benchmark against which decisions can be assessed, in line with the public duty to our climate and nature targets. As the definition within the framework agreement would specifically refer to, those are the climate targets under the Climate Change Act 2008 and the nature restoration goals under the Environment Act 2021.
This would mean that the Crown Estate cannot simply pay lip service to sustainability; it must actively contribute to decarbonisation, biodiversity protection and the UK’s broader environmental goals. Climate change and nature loss are economic risks, as well as environmental ones. Embedding clear, enforceable sustainability duties in the Crown Estate’s framework, according to our existing legislation, will ensure that its investments and operations support long-term resilience and prosperity. This amendment strengthens the existing clause. It does not seek to define it on the face of the Bill, but assures us, as happened in the other House, that the definition is within the framework agreement.
Perran Moon (Camborne and Redruth) (Lab)
I will also speak to amendment 1. I add my voice to the request for assurances from the Minister on the alignment of sustainable development with the UK’s net zero goals, and also on community benefits. I agree with him that we must not lay too narrow a scope on the Crown Estate and seek to limit its opportunity as a key revenue driver for the UK economy. Goodness knows, we need it after 14 years of Conservative failure.
I am really concerned, however, about the potential bypassing of deprived coastal communities in the revenue from the Crown Estate to the Treasury. It would be nice to get reassurance from the Treasury of the Government’s plans to ensure that coastal communities closest to many of these huge revenue opportunities will see some of the benefits of that growth.
Mr Andrew Snowden (Fylde) (Con)
It is a pleasure to serve under you on this Committee, Ms Furniss. I would like to echo the final points—not some of the other points, obviously—of the hon. Member for Camborne and Redruth regarding reassurances from the Minister about the economic benefit that these offshore projects will create for local communities. I represent a coastal community with the beautiful Fylde coastline, and north of us is Blackpool and Fleetwood. The Crown Estate owns significant amounts of seabed off the coast of Fylde. There are a number of projects under way, including the Morgan and Morecambe wind farm, which will cable through Fylde constituency to get to the national grid.
These amendments reference the Environment Act 2021 and regional economic growth. Can the Minister give reassurances that when projects such as offshore wind go ahead—they could be further encouraged by these amendments—local communities will be taken into account regarding the economic benefit? At the minute, a lot of the projects end up being opposed by and very unpopular with local communities, because all they see is the environmental damage being done to their area, countryside and coastline, and there is no economic benefit left from residual cabling that runs through areas. Although I welcome some of what the amendments try to do, I seek assurances that, at the heart of this, we have the communities who are negatively impacted by these projects seeing benefit as well.
James Wild
Clause 3, the first of several clauses added on Report in the House of Lords, will amend section 1 of the 1961 Act to require the commissioners to review the impact of their activities on achieving sustainable development.
The Chair
Order. Can I stop the shadow Minister? We are talking about only amendments 1, 6 and 8. The debate on clause 3 stand part will come later.
James Wild
Okay. Amendment 1 would require the Crown Estate commissioners to have regard to net zero targets, regional economic growth and ensuring resilience in various areas. Instinctively, I am a bit sceptical about putting more obligations on the Crown Estate, given that its primary purpose is to generate a return for the nation. As I mentioned in passing, clause 3 already applies a sustainable development duty. The hon. Member for Great Grimsby and Cleethorpes spoke pretty persuasively, so I look forward to the assurances that the Minister might give before we see whether the Committee divides on the amendment.
James Murray
With your permission, Ms Furniss, I will briefly add to the comments that I made in the previous debate, because the shadow Minister asked about the appointment of the chair. On 23 December, the Government announced Ric Lewis as our preferred candidate for chair of the Crown Estate. The Government also confirmed that the appointment would be subject to a parliamentary pre-appointment hearing. Under paragraph 9.2 of the governance code on public appointments, political donations should be publicly disclosed if the successful candidate has made a significant donation or loan to a party in the last five years. That will happen if the appointment is confirmed, following the Treasury Committee’s report, and a subsequent announcement is made. Thank you for your patience, Ms Furniss.
Amendment 1, which was tabled by my hon. Friend the Member for Mid and South Pembrokeshire (Henry Tufnell), and to which other hon. Members have spoken, would require the Crown Estate commissioners, in reviewing the impact of their activities on the achievement of sustainable development, to have specific regard to the UK’s net zero targets, to regional economic growth and to ensuring resilience in respect of managing uncertainty, risk and national security interests. I was glad to meet my hon. Friend on Tuesday to discuss the amendment. The Government understand the motive behind it, but it is important first to set out the context for clause 3. I will be brief, as I realise that we will debate clause 3 stand part later.
The Government and the Crown Estate welcomed the addition of clause 3 on Report in the other place, as a clarified and enhanced accountability on the Crown Estate to deliver environmental, social and economic outcomes. The Crown Estate is already a trailblazer in its efforts on tackling climate change and supporting the environment, which I will address in more detail later. Clause 3 will require the commissioners to keep under review the impact of their activities on the achievement of sustainable development in the UK. It is important to note that the public framework document that governs the relationship between the Crown Estate and the Treasury will be updated in the light of clause 3 to include a definition of sustainable development and to confirm that the Crown Estate will continue to include specific information on its activities in its annual report.
The Crown Estate Act 1961 established the Crown Estate as a commercial business, independent from Government, that operates for profit and competes in the marketplace. It is analogous to a private sector commercial operator. The commissioners operate under a clear commercial objective, as set out in the Act, to “maintain and enhance” the value of the estate. At the same time, the Crown Estate can and does focus on activities that closely align with wider national interests, including on the environment, net zero, our nation’s energy needs and sustainable economic growth. As a public body, the Crown Estate seeks to work with the grain of prevailing Government policy.
In addition to its core commercial objective, the Crown Estate operates under a duty in the 1961 Act to have
“due regard to the requirements of good management.”
This obliges the Crown Estate to maintain and enhance the value of the estate responsibly. Good management practices include maintaining a strong governance structure, adhering to best practices in risk management, and fostering a culture of accountability and transparency.
It is important for the Bill to stand the test of time as new, relevant areas of concern on the environment, society and the economy emerge over the coming decades. These currently include net zero and regional economic growth, which are given regard by the Crown Estate and should be covered in its annual report. The general term “sustainable development” was chosen because it is broad and captures the widest range of relevant concerns across the environment, society and the economy, now and as priorities in those areas evolve over time.
Noah Law (St Austell and Newquay) (Lab)
I recognise that it might not be the place of statute to outline some of the specifics brought up by the amendment, but does the Minister agree that the spirit of the amendment is well in keeping with the mission of this Government and, moreover, that of regional economic development in particular, which spreads to all corners of Britain? That is important, and it is incumbent on the Treasury more widely to ensure that that takes place, particularly through the channel of supply chain development.
James Murray
My hon. Friend is absolutely right. A priority of the Government is to ensure not only that there is economic growth at a national UK level, but that all regions and nations of the UK benefit from such economic growth and the increase in productivity. We want to ensure that people right across the country are better off and have more money in their pocket through greater investment and growth in their local areas. He makes an important point.
To return to the definition of “sustainable development”, I will briefly address the point made about that by the hon. Member for South Cambridgeshire. I assure her that that definition will be published on Royal Assent of the Bill, at that point. It was, however, a deliberate decision not to specify specific targets or objectives such as net zero on the face of the Bill, given that the Crown Estate is already required to “maintain and enhance” the value of the estate responsibly. Referencing specific targets would risk complicating the Crown Estate’s existing clear commercial objective.
As I have already noted, the Crown Estate is required to pay its entire net profits to the UK Consolidated Fund every year, worth more than £4 billion over the past decade. That supports the UK Government’s spending on policy priorities, including net zero and, indeed, regional economic growth.
On national security interests specifically, it is important to be clear that the Government are responsible for ensuring that national security interests are managed effectively at a UK-wide level. It would not be appropriate to require the Crown Estate to have a specific regard in that matter. As I have noted, while the Crown Estate has goals under which its strategy can align with wider national policy objectives, the 1961 Act provides the Crown Estate with independence and autonomy. The Government believe that it should continue to operate in that way, as a commercial business independent of Government. This requirement would encroach on that independence by drawing the Crown Estate into interests managed directly by the Government.
The Government believe that the Crown Estate’s existing duties give it a clear focus, leading to a consistently significant return to the Exchequer to support the funding of public services and priorities. The duty to have due regard to the requirements of good management, alongside the new requirement to keep under review the impact of its activities on the achievement of sustainable development, are already sufficient to cover the concerns of my hon. Friend the Member for Great Grimsby and Cleethorpes. I hope that the amendment will be withdrawn.
I turn to amendments 6 and 8, tabled respectively by the hon. Members for Ynys Môn and for South Cambridgeshire. Amendment 6 would require the commissioners, in complying with proposed new subsection (3A) of the 1961 Act on sustainable development, to
“set and publish sustainable development objectives in relation to their activities…take all reasonable steps to meet these objectives, and…have regard to the relevant environmental legislation for the UK, England, Wales and Northern Ireland in relation to making these objectives.”
It would further specify that the relevant environmental legislation includes the Climate Change Act 2008, the Environment Act 2021, the Well-being of Future Generations (Wales) Act 2015 and the Environment (Wales) Act 2016.
Amendment 8 would require any “framework document” published by the Chancellor of the Exchequer, the Crown Estate or the commissioners to define “sustainable development”, and that that definition include a reference to a “climate and nature duty”. It further specifies that such a climate change duty would mean a duty to achieve any of the targets set out under part 1 of the Climate Change Act 2008, or under sections 1 to 3 of the Environment Act 2021.
The Government understand the intention behind amendments 6 and 8, but a key purpose of the 1961 Act was to repeal various detailed statutory provisions that had built up over the 150 years previously, which were hampering the effective management of the estate. By focusing the commissioners’ duties on enhancing the estate’s value and the returns generated, the commissioners have a clear objective for which they can be held to account. It is an important principle that giving an organisation too many objectives will make it far less effective than giving it clear and focused priorities. As I have already noted, the Crown Estate is a commercial business, independent from Government, that operates for profit.
Pippa Heylings
To seek clarification, is the Minister saying that, unlike what seemed to be the agreement reached in the other House, we will not seek, through this legislation or any burden put on the Crown Estate, to ensure that it has a climate and nature duty, such as other bodies have? That will not form part of the definition of sustainable development he said will be published on Royal Assent.
James Murray
As I mentioned, the definition of “sustainable development” will be published on Royal Assent. Perhaps we can return to any questions that the hon. Member may have on that definition at that point.
The fundamental point that I am seeking to make is about ensuring that the Crown Estate can operate effectively. By having clear and focused priorities, it will operate more effectively than having too many objectives, which end up meaning overall that it will perform less well in the public interest. As I have noted, the Crown Estate is a commercial business. It is independent of Government and operates for profit. Although it has goals that, under its own strategy, can align with national policy objectives, fundamentally, the 1961 Act grants the Crown Estate independence and autonomy.
The Government have accepted the amendment to require the commissioners to keep under review the impact of their activities on the achievement of sustainable development. However, expanding the Crown Estate’s core purposes in legislation, in particular with additional duties or objectives that may unnecessarily complicate or conflict with the achievement of the core commercial objective, would risk undermining that core objective being achieved.
Any actions that undermine the core commercial objective risk undermining the very funding that is used to support environmental and other policy objectives. The Government believe that the Crown Estate should continue to operate in this way—as a commercial business, independent of Government—because it has shown itself to be a trusted and successful organisation, with a proven track record and effective management.
As I noted, the Crown Estate is already a trailblazer in its efforts to tackle climate change and support the environment, and it is required to pay its profits into the UK Consolidated Fund each year. Furthermore, I confirm that the requirement under amendment 8 for any framework document between the Treasury and the Crown Estate to define sustainable development has already been agreed by the Government.
As confirmed on 5 November on Report in the other place, the public framework document that exists between the Treasury and the Crown Estate will be updated in the light of that amendment to clarify that “sustainable development” means regard for the impact of the Crown Estate’s activities on the environment, society and the economy. It will also make it clear that that regard includes, where relevant, consideration of relevant legislation, such as part 1 of the Climate Change Act 2008, which deals with the targets set for 2050, and section 56 of the Climate Change Act and sections 1 to 3 of the Environment Act 2021, which also deal with specific environmental targets. The framework document will also make it explicit that the Crown Estate will include in its annual report a report of its activities in relation to sustainable development. For those reasons, I trust that hon. Members will be able to withdraw their amendments.
Melanie Onn
I do not intend to press the amendment to a vote. I accept the point about the Crown Estate being a commercial business, but I am less persuaded that it is unable to cope with an additional objective. When I think about other organisations in the public sector and the number of objectives that we set for them, I am fairly sure that a commercial business has the wherewithal to be able to manage that. However, I accept the potential for an impact on the returns of that commercial business. The Minister has given indications regarding the annual report, and I hope that he will have heard today the determination of Members from coastal communities and the importance of this to them. He will be aware of the strength of feeling about the necessity of ensuring that we have real delivery and community benefits from the extended powers and facilities that we are providing to the Crown Estate.
We will not press the amendment to a vote, but, when it comes to accountability, we know where the Minister’s door is and I am sure we will happily knock on it should the need arise.
The Chair
Amendment 8 has just now been debated with amendment 1. Pippa Heylings indicated that she might press amendment 8 to a Division. Will she wish to move it?
Pippa Heylings
We have received assurances that we will have the chance to discuss the sustainable development definition at the time of Royal Assent and that the framework document will pay due regard to climate and nature duties in relation to our targets for 2050 under the Climate Change Act and to our nature restoration duties under the Environment Act; that is good. I urge the Minister to consider that it is an economic choice to consider climate and nature up front, not only that we then raise the money to provide for environmental funding post operation. That is something that we should all embrace, in particular in the Treasury.
Melanie Onn
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chair
Before we come to amendment 9, I impress on the Committee that this is grouped for debate only with new clause 10. Clause stand part will be debated next.
Pippa Heylings
I beg to move amendment 9, in clause 3, page 2, line 17, at end insert—
“(3B) In pursuit of the objective under subsection 3A, the Commissioners must assess the adequacy of protections against coastal erosion in areas affected by their offshore activities.”
The Chair
With this it will be convenient to discuss new clause 10—Marine Spatial Planning: coordination—
“In relation to any decisions made about marine spatial priorities, the Crown Estate must—
(a) ensure that the decisions are coordinated with the priorities of the Marine Maritime Organisation, and
(b) consult any communities or industries impacted by the plans, including fishing communities.”
This new clause ensures the Crown Estate collaborates with DEFRA’s Marine Spatial Prioritisation through the MMO.
Pippa Heylings
Given our conversations in this debate about the importance of considering our coastal communities in relation to the new powers that are to be given to the Crown Estate, I draw attention in particular to an example on the north Norfolk coast, the fastest-eroding coastline in north-west Europe.
Key sites, vital to our energy infrastructure and security, lie on that coast. For decades, Bacton gas terminal has been a cornerstone of the UK’s gas network, ensuring the smooth distribution of supplies arriving from overseas. Just along the coast, in Happisburgh, we find the landfall sites for the Norfolk Boreas and Norfolk Vanguard wind farms, which will generate 1.4 GW and 1.8 GW of power respectively—critical contributions to our renewable energy future.
To protect Bacton’s vital infrastructure, a £20 million sandscaping project moved 2 million tonnes of sand, shielding not just the terminal, but the villages of Bacton and Walcott. In Happisburgh, however, despite its pivotal role in our transition to clean energy, no such protections have been put in place. Already, 40 homes have been lost to coastal erosion, and the latest national coastal erosion risk-mapping data shows that even more of the village is at risk in the years ahead. The amendment would ensure that, as we harness the power of North sea wind, we also safeguard the fragile North sea coast, protecting the communities that host that vital infrastructure.
I will also speak to new clause 10. We have heard about the importance of considering coastal communities within all the decision making, and this new clause on marine spatial planning co-ordination would ensure that the Crown Estate’s decisions on marine priorities were properly co-ordinated and aligned with the Marine Management Organisation, which has the mandate for mediating use priorities on our seabed and along our coast. Affected communities, in particular our fishing communities, would therefore be properly and fully consulted through the Marine Management Organisation.
Similar to the land use framework, this would be a sea use framework for the marine spatial plan that the Marine Management Organisation is mandated to under-take. We need a joined-up approach to decision making, with marine plans balancing economic, environmental and social interests. The Crown Estate must therefore work in full co-ordination with the marine spatial prioritis-ation framework of the Department for Environment, Food and Rural Affairs.
Jayne Kirkham
The Crown Estate has started to consult, and is publishing plans before it takes decisions about where to put floating offshore wind stations, for example. Can the Minister assure us that that will be the case in the future, and that when the Crown Estate is planning to build out in the ocean, there will be consultation with fishermen and environmentalists? I think that is the intention, as discussed on Second Reading.
Pippa Heylings
I thank the hon. Lady for that point, which we discussed in the Chamber. The crux of this amendment is that there is a mandate for the Marine Maritime Organisation, which is the body that mediates. The Crown Estate is being given new powers for borrowing and investing, and therefore has a vested interest in the prioritisation of activities that are allocated along the seabed and our coasts. That is good, given its amazing, award-winning geospatial mapping prowess.
We have just heard examples of how it is showing the Government scenarios for the economic income and gain that can be gathered from different uses. However, despite that prowess, the Crown Estate should not be the one to prioritise or make the final decision about which activities take place. Communities and other users must be fully consulted. The MMO is mandated to do that, and DEFRA has the marine spatial prioritisation framework, within which the Crown Estate should contribute and co-ordinate. That is the assurance we seek through this amendment.
James Wild
I rise briefly to speak to amendment 9, not least because I represent North West Norfolk, which is next door to North Norfolk where I grew up. It is sometimes quite difficult to get the local names correct, but Happisburgh is actually pronounced “Haysborough”, rather than “Happisberg”. I wanted to get that on the record, because people there feel quite strongly about it—it is a mistake that is inadvertently made quite a lot.
It is important to protect national assets such as those at Bacton from coastal erosion. I would expect the Crown Estate already to be taking account of such requirements, and the Government to be doing likewise through their wider planning and strategic approach to coastal erosion, so I look forward to the Minister’s response on how coastal erosion will be prevented.
James Murray
I rise to speak to amendment 9 and new clause 10.
Amendment 9, tabled by the hon. Member for South Cambridgeshire, would mean that in satisfying proposed new subsection (3A) of the 1961 Act, which states,
“The Commissioners must keep under review the impact of their activities on the achievement of sustainable development in the United Kingdom”,
the commissioners must assess the adequacy of protections against coastal erosion in areas affected by their offshore activities. I very much understand the concerns reflected in the amendment, but protections against coastal erosion are not the responsibility of the Crown Estate, and therefore the amendment is not relevant to the Bill.
The UK has dedicated statutory bodies under each devolved Administration with responsibility for ensuring adequate protection against coastal erosion. The Crown Estate always collaborates and complies with the relevant statutory authority for any assessment of the impact of offshore activity on coastal erosion, and the potential for coastal erosion should be considered as part of marine licensing, which is considered by the relevant regulator, depending on the jurisdiction. However, the statutory responsibility falls on the relevant body in each devolved area.
The Crown Estate becomes involved in coastal defence only when the statutory bodies responsible for coastal erosion wish to construct defences. In such cases, the Crown Estate typically grants leases to those bodies for defence works.
Although the Crown Estate is not responsiblefor coastal erosion, the Government are committed to supporting coastal communities and are investing ausb record £2.65 billion over two years in building, maintaining and repairing our flood and coastal defences. Shoreline management plans are developed and owned by local councils and coastal protection authorities to provide long-term strategic plans that identify approaches to managing coastal erosion and flood risk at every stretch of the coastline. Shoreline management plans have recently been refreshed with updated action plans, following several years of collaborative work between the Environment Agency and coastal groups.
The Environment Agency has published the updated national coastal risk map for England, which is based on monitoring coastal data, the latest climate change evidence and technical input from coastal local authorities. There are also strong safeguards to manage the flood and coastal risk through the planning system. I hope that on that basis the hon. Member for South Cambridgeshire feels able to withdraw her amendment.
I turn to new clause 10, which would require that in relation to any decisions made about marine spatial priorities, the Crown Estate must ensure the decisions are co-ordinated with the priorities of the Marine Management Organisation and must consult any communities or industries impacted by the plans, including fishing communities.
I can confirm to the Committee that the Crown Estate and the Marine Management Organisation already have well-established ways of working together to ensure effective collaboration for marine spatial planning and prioritisation. The Crown Estate’s collaboration with the Marine Management Organisation and other relevant statutory bodies is governed by the Marine and Coastal Access Act 2009, which establishes the framework for marine planning and licensing in the UK, and requires the Crown Estate to have regard to marine policy documents such as marine plans in its decision making. It is also governed by the habitat regulations, which require the Crown Estate to conduct plan-level habitat regulation assessments for leasing or licensing activities.
Furthermore, the Crown Estate and the Marine Management Organisation jointly agreed a statement of intent in 2020, which is reviewed periodically to provide a focus on priorities and opportunities for alignment, as well as longer-term ambitions. The statement of intent complements a memorandum of understanding agreed in February 2011, which sets out a framework to encourage co-operation and co-ordination between parties in relation to the sustainable development of the seabed and rights managed by the Crown Estate, based on active management, shared information and effective marine planning and management by both parties.
In addition to the Crown Estate’s relationship with the Marine Management Organisation, there are also various regulatory requirements on developers leasing areas of the seabed from the Crown Estate to engage with the Marine Management Organisation through a number of routes. Those include through marine licensing; developers must obtain marine licences from the Marine Management Organisation for activities that could impact on the marine environment. The process involves consultation with statutory bodies and adherence to marine plan policies. As part of a marine licence application, developers must also conduct environmental impact assessments for projects that could significantly affect the environment, which includes consultation with the Marine Management Organisation and other relevant authorities to ensure compliance with environmental regulations. Developers are also encouraged to engage with local communities, statutory bodies and other stakeholders throughout the planning and development process to address concerns and ensure compliance with marine plans.
This new clause therefore duplicates existing regulatory requirements and practice. I hope the hon. Member for South Cambridgeshire feels able to withdraw her amendment.
Mr Snowden
I feel sympathy with the contributions from both the Minister and the hon. Member for South Cambridgeshire. There are some issues at the heart of what the amendment and new clause are trying to achieve, but whether they are within the scope of the responsibility of the Crown Estate is an equally valid point. New clause 9 talks about coastal erosion and, while that is an issue, there is also the issue of coastal damage caused by projects where the seabed in particular is licensed. Again, Morgan and Morecambe off the Fylde coast will lead to years of work trying to rebuild sand dunes that will be cabled and tunnelled through for a new cabling corridor. The dunes will be completely damaged due to activity coming in to connect to the national grid.
Furthermore, the new clause talks about consultation. This is where I really do have some sympathy with the Minister, because that is not the responsibility necessarily and primarily of the Crown Estate. The root cause of the issue is that there are already regulations in place for consultation to happen where licences are being issued. The consultation happens; people consult and then they just ignore local communities and industries. Nothing changes, and perfectly valid objections and alternative routes for cabling corridors coming in from the sea are just ignored—but that is a broader issue rather than specific to this point.
Pippa Heylings
I will not press either of these amendments to a Division, but I would like to call attention to the fact that, given the greater borrowing and investment powers, the existing frameworks and regulations under which the Crown Estate has been co-ordinating the Marine Management Organisation need to be considered. I think we can all recognise that the situation has changed hugely. Therefore, I urge the Government to consider how they will ensure that there is greater consultation on decisions around prioritisation of what happens where, that greater weight is given to that, and that more resources and powers are given to the MMO to ensure that that happens. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss new clause 11—Sustainable development: community benefits—
“(1) Before making any investment decision, the Commissioners must assess—
(a) plans for community benefits for local communities, and
(b) plans for community benefits for coastal communities of offshore activities.
(2) In section 3(1) of the Crown Estate Act 1961, at end insert—
“(1A) The Commissioners must transfer at least 5 per cent of all net profit generated from the Crown Estate’s activities to local communities impacted by those activities.”” —(Pippa Heylings.)
This new clause would require the Commissioners to ensure their activities benefit local communities, including coastal communities, and that 5% of any profits would be transferred to local communities.
James Murray
Clause 3 amends the Crown Estate Act 1961 to require the commissioners to keep under review the impact of their activities on the achievement of sustainable development in the UK. I have referred to various aspects of clause 3 as part of our earlier debate, so I will try to be brief. As hon. Members know, this clause was added as an amendment in the other place, based on productive debates that reflected the important role that the Crown Estate has in stewarding our natural environment. As I noted earlier, the Government believe that the Crown Estate’s existing duties give it a clear focus, leading to a consistently significant return to the Exchequer to support the funding of our public services.
At the same time, the Crown Estate can, and does, focus on activities which also closely align with wider national interests, including on the environment, net zero, our nation’s energy needs and sustainable economic growth. As a public body, the Crown Estate seeks to work with the grain of prevailing Government policy. That said, it is right that the public and private sectors make every contribution they can to achieving our climate change targets, and the Crown Estate should continue to be a national trailblazer in that regard. The Crown Estate has committed to becoming a net zero carbon business by 2030, aligning with the 1.5° target, and will prioritise activities that help to enable a reduction in national carbon emissions, such as building net zero homes, transitioning its holdings to sustainable agricultural practices and working in partnership with the Government to meet the national renewable energy targets.
Regarding the biodiversity targets in the Environment Act, the Crown Estate is committed to delivering a measurable increase in biodiversity by 2030. It will publish its delivery plan to meet that goal later this year, which will include commitments to restore habitats in line with targets in the Environment Act. The Crown Estate also published its approach on nature recovery last autumn, where it committed to delivering increased biodiversity, to protecting and restoring freshwater, marine and coastal systems and to increasing social-wellbeing benefits from nature. However, the reforms introduced by this Bill are not intended to alter the fundamental statutory basis of the Crown Estate as a commercial business independent from Government.
The commissioners operate under a clear commercial objective, as set out in the 1961 Act: to maintain and enhance the value of the estate. As I have already noted, the Crown Estate operates under a duty in the 1961 Act to have due regard to the requirements of good management. Alongside its core commercial objective, the duty obliges the Crown Estate to maintain and enhance the value of the estate responsibly. It is the Government’s view that these existing statutory requirements and this clause are the best approach.
New clause 11, tabled by the hon. Member for South Cambridgeshire, would require the commissioners to assess plans for benefits to local communities and, in the case of offshore activities, coastal communities before making any investment decisions. It would also require the commissioners to transfer at least 5% of the Crown Estate’s net profit to the local communities impacted by its activities.
At present, local communities benefit from onshore and offshore developments through the economic advantages that such developments bring, including job creation and increased business for local suppliers, and individual developers also contribute to local initiatives. The Crown Estate has also specifically designed the leasing process for its offshore wind leasing round 5 opportunity in the Celtic sea such that developers must make commitments to deliver social and environmental value as part of the development of their new wind farms. Those commitments will be monitored, reported on and enforced throughout the lifetime of the relevant round 5 developments.
The Crown Estate is committed to proactively working with the local communities and partners to enable employment and skills opportunities. For example, it has allocated £50 million through the supply chain accelerator to stimulate green jobs and is developing a green skills pipeline, from a GCSE in engineering skills for offshore wind, seed-funded by the Crown Estate and developed with Cornwall college, to a post-16 “Destination Renewables” course with Pembrokeshire college. The Crown Estate is also partnering with the employment charity Workwhile to create green construction apprenticeships.
The Crown Estate already works closely with communities, charities, businesses and the Government to ensure that its skills initiatives are sensitive to market demands and emerging technologies and to keep them relevant and effective. The Government consider it important that the Crown Estate retains that flexibility in how its skills initiatives are funded and delivered, to ensure that it can contribute to skill training in the best possible way and, importantly, without conflicting with its statutory duty to maintain and enhance the value of the estate.
On that basis, I hope that the hon. Member for South Cambridgeshire feels able to withdraw her new clause. It is the view of the Government that the existing statutory requirements and this clause are the best approach going forward. I commend clause 3 to the Committee.
Pippa Heylings
The Minister might have pre-empted my speaking to the new clause. The new clause would ensure that local and coastal communities see real benefits from Crown Estate activities by requiring a proper assessment of community benefits before investment decisions are made and by mandating that at least 5% of net profits be transferred to impacted communities.
For too long, communities, particularly coastal communities, have borne the impact of large-scale offshore developments without seeing a fair share of the financial benefits; we heard that earlier today. The Crown Estate generates billions in revenue from offshore wind farms, marine industries and land developments, yet too often local people see little direct return. The new clause seeks to redress that imbalance and would ensure that those communities benefit from our journey towards net zero, taking people with us.
First, the new clause would ensure transparency and accountability by requiring that the Crown Estate formally assess community benefits before making investment decisions. That would mean that local communities would no longer be an afterthought. They must be considered from the outset in decisions affecting their livelihoods, identity, infrastructure and environment.
Secondly, the new clause would establish a concrete financial commitment by mandating that at least 5% of the profits generated by the Crown Estate’s activities must be reinvested in local communities impacted. That is a fair and proportionate measure, recognising that those communities are often on the frontline of change, whether it be from offshore energy projects, tourism pressures or rural land use shifts. The kickbacks could be revolutionary for towns and villages across the UK and would be a real testament to how clean energy can level up communities.
The new clause is about not just fairness, but economic regeneration. It would provide a direct funding stream to support local jobs, infrastructure, training and environmental projects, and ensure that prosperity generated from our shared natural resources is not centralised in Whitehall or in corporate boardrooms, but flows directly back to the people and places most affected.
If the Government are serious about levelling up and supporting coastal and rural communities and economies, they should have no issue backing the new clause. It is practical, and it would enable us to manage the different developments. It does not seek to block development; it would ensure that development happens fairly and sustainably, with proper co-ordination.
James Wild
I will briefly speak to new clause 11. On Second Reading, we heard a lot of debate and discussion about the role of community benefits. As I mentioned, I represent a coastal area where there are existing community benefit schemes through the operators of the offshore wind projects that operate on the East Anglian coast.
The Energy Secretary, who seems to be on a one- man mission to put solar farms on farmland and to put pylons across the countryside with no regard to the impact on communities or nature, has said that the Government will bring forward their own approach to community benefits. I am a strong supporter of community benefits, and I look forward to the Energy Secretary coming forward with that plan. It seems to be the best approach and context in which to address the important points raised by the hon. Member for South Cambridgeshire.
James Murray
I thank the hon. Members for their comments. To reiterate, the Crown Estate already works with communities, charities, businesses and the Government to ensure that its skills initiatives are sensitive to market demand and to emerging technologies. It is important that the Crown Estate retains this flexibility in how its skills initiatives are funded and delivered, so that it can contribute to skills training in the best possible way and, importantly, as I have referred to several times, without conflicting with its statutory duty to maintain and enhance the value of the estate. As we know, the Crown Estate already pays its net revenue surplus into the Consolidated Fund. That is a total of more than £4 billion in the last decade, and local communities already benefit from investment by the Crown Estate. I point hon. Members to the partnership between Great British Energy and the Crown Estate; they will work together to co-ordinate agencies and stakeholders to create jobs and ensure that communities reap the benefits of clean, secure, home-grown energy.
I repeat my encouragement of the hon. Member for South Cambridgeshire not to move her new clause, as I believe the Bill and the existing measures and statutory requirements achieve the outcomes that are best for this country.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
Clause 4
Annual reports
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss new clause 4—Partnership agreement: the Crown Estate and Great British Energy—
“The Chancellor of the Exchequer must lay before Parliament any partnership agreement between the Crown Estate and Great British Energy.”
This new clause requires the Chancellor of the Exchequer to lay before Parliament any partnership agreement between the Crown Estate and Great British Energy.
James Murray
Clause 4 requires the commissioners to include in their annual report a summary of their activities and of any effects or benefits resulting from their activities under any partnership between them and Great British Energy, which I referred to in our debate on the previous clause. This requirement will only apply in relation to a year in which such a partnership was in operation. Following productive debate in the other place on the new partnership between the Crown Estate and Great British Energy announced last year, this clause was added by the Government. The Crown Estate is keen to ensure that details of this partnership are publicly available on an ongoing basis, and the Government agree it is sensible to require the Crown Estate to include the relevant detail in its existing annual report. That is the intention behind clause 4.
New clause 4, tabled by the hon. Member for North West Norfolk, would require the Chancellor to lay before Parliament any partnership agreement between the Crown Estate and GB Energy. As I am sure the hon. Member will appreciate, partnership agreements are highly commercially sensitive. It is therefore right that any agreement is not made public or laid before Parliament, as to do so would likely prejudice the commercial interests of the Crown Estate or GB Energy and risk the aims of the partnership, which are to speed up the process of delivering clean energy and to invest in clean energy infrastructure. The Department for Energy, Security and Net Zero will set out further detail on GB Energy in due course. I hope the hon. Member feels able not to move his new clause as a result.
Clause 4 is a sensible change to the Bill that reflects the desire to ensure that relevant information related to the nationally significant partnership between GB Energy and the Crown Estate is made publicly available. I commend the clause to the Committee.
James Wild
As the Minister said, clause 4 was added on Report in the House of Lords to require the Crown Estate’s annual report to include activities under the partnership between the Crown Estate and GB Energy. I will also speak to new clause 4, which is in my name.
Clause 4 does introduce an important layer of transparency, as the Minister said, ensuring there is a specific report on the activities of the commissioners under that partnership during the year, and on any effects or benefits experienced during the year that are a result of those activities. This is a welcome step, and we support the clause. However, the reporting requirement would only apply in years when a partnership between the commissioners and GB Energy was in operation. This means we will not know what has been agreed until the partnership is operational. Parliament—I think not unreasonably—needs to see an agreement when it is finalised. That is why I have tabled new clause 4.
New clause 4 would simply require the Chancellor of the Exchequer to lay before Parliament any partnership agreement between the Crown Estate and GB Energy. This new clause is of fundamental importance. Without being able to see the details of the partnership agreement, we do not know what has been agreed and the impact on the duties of the Crown Estate. On the day that the Bill was introduced, the Government, with a lot of fanfare, announced the partnership between the Crown Estate and GB Energy. Indeed, Ministers claimed that the new GB Energy partnership would “turbocharge energy independence” and
“unleash billions of investment in clean power.”
However, currently there is a distinct lack of transparency over how this partnership will work and what difference it will make. I am concerned that this partnership may have been created for political, rather than economic, purposes.
James Wild
My point about the new clause is trying to get some transparency about what those proceeds might be. I do not whether the hon. Member can enlighten me as to from where they might be coming and which projects will be invested in, or how many jobs will be created. He might apply for the job of the chairman of GB Energy, because the current one does not seem to know the answer to any of those very important questions. We are being asked to legislate to support a partnership between the new entity of GB Energy and the Crown Estate, so I make no apology for seeking greater transparency.
When pushed on Second Reading, the Minister confirmed:
“Although the partnership agreement itself will not be published, given that it will be commercially sensitive”—
I think he said “very commercially sensitive” this afternoon, or “highly”—
“the Crown Estate has committed to publish information relating to the partnership as part of its existing annual report.” —[Official Report, 7 January 2025; Vol. 759, c. 806.]
But at all stages of the Bill’s passage and in the amendments that have been tabled, the Government have had to be pressured to be more transparent. Given that the Bill makes significant changes to the operation of the Crown Estate and reduces parliamentary oversight, I do not see why Parliament should not have sight of an agreement. It is simply not good enough to hide behind excuses of commercial confidentiality.
If the Minister is genuinely concerned about the conservative nature of this—[Laughter.] He probably is! I should have said: if the Minister is genuinely concerned about the commercially sensitive nature of the agreement, perhaps a redacted version could be laid before Parliament, for example, or the full version could be provided to the Public Accounts Committee. I had the pleasure to serve on that Committee for over two years, and it was not uncommon for similar agreements to be provided in confidence to the Chair and the Committee to give assurance, on behalf of other Members of the House, that this was a bona fide commitment that did not need to be drawn more widely to public attention, noting the strictures there may be about commercial confidentiality.
I have spoken to the current Chair of the Public Accounts Committee, my hon. Friend the Member for North Cotswolds (Sir Geoffrey Clifton-Brown), about this, and he would be very happy to receive a copy of the partnership agreement and continue to operate—as he has done over a decade or more as deputy Chair—by recognising and respecting confidentiality and the basis on which it is provided. It would provide assurance for all Members of the House that one of the pre-eminent Committees of the House has oversight of the agreement. If the Minister is not minded to agree to our new clause—I detect that he is not—perhaps he will look at the feasibility of a taking a redacted version of the agreement, or a similar approach, to the Public Accounts Committee.
In advance of this Bill Committee, I wrote to Dan Labbad, chief executive of the Crown Estate, to seek clarity on the partnership agreement. I am grateful that he took the time to respond. I asked whether the Crown Estate is planning to agree to invest a certain amount with GB Energy. His response was:
“Any arrangements the Crown Estate enter into with GBE will be expressly subsidiary to our statutory duty to maintain and enhance the value of the estate, but with due regard to the requirements of good management…We will ensure that the Crown Estate continues to deliver on our wider obligations”.
Can the Minister confirm that the Crown Estate’s statutory duty will always have primacy? Without the agreement being laid before Parliament, we will not have the transparency to see whether commitments have been given, and to judge and assess whether they meet the criteria.
I also asked Dan Labbad how the Crown Estate will decide between projects that GB Energy backs and other projects that may have a higher rate of return. I note the comments from the hon. Member for St Austell and Newquay, but it may be that the Crown Estate could identify non-GB Energy projects that may generate a greater return for the taxpayer and our constituents. In that case, it should be investing in those, not a political project under the Energy Secretary. Dan Labbad said:
“The Crown Estate will have a clear business plan in relation to the partnership… The consideration of which projects fulfil that business plan will take into account our statutory duty to maintain and enhance the value of the estate…and the obligation upon the Crown Estate to secure the best consideration, having regard to all the circumstances of the particular case at the time.”
“All the circumstances” is rather broad, and “take into account” could be seen as rather weak. Can the Minister confirm whether he has seen a copy of any such business plan? Would he expect to? I fear the answer will be no, but would he be prepared to lay a copy of it before the House so that Members can scrutinise it?
Finally, I asked Dan Labbad about the new division’s decision-making process, because the new clause is about trying to get underneath the bonnet of the agreement. He said:
“The Crown Estate’s agreement with GBE is such that activity undertaken through the partnership will not undermine the Crown Estate’s independence. The intention is that both parties will seek agreement on investment decisions whilst retaining their own independence. The Crown Estate will not be compelled to agree to anything which it does not wish to agree to in fulfilment of its statutory duty.”
“Compelled” is a very strong word to use in that context.
On one level, the responses could be seen as reassuring, but I think back to the exuberant press release I referred to earlier and the excitement in the announcement of what the partnership could deliver and what the Government thought it could do. Can the Minister clarify how much he expects the Crown Estate to invest in the Energy Secretary’s personal investment fund? Can he rule out Ministers pressuring the Crown Estate, whether that be through GB Energy and the chairman they have appointed or the chairman of the Crown Estate, who will shortly be going before the Treasury Committee? Can he rule out pressuring any of those people to invest more than the Crown Estate considers to be prudent?
I have raised my points briefly. I could go on for longer, though I am not sure the Committee would enjoy that. We are asking reasonable questions about this “groundbreaking partnership” agreement—I am looking at the exciting press release in front of me. It is incumbent on the Minister to provide some clarity and assurance on this—and I hope, having listened to the argument, accept that it is not unreasonable to place before Parliament a partnership agreement that can be redacted and before the Public Accounts Committee the full agreement. I look forward very much to the Minister’s response.
Ordered, That further consideration be now adjourned. —(Christian Wakeford.)
Crown Estate Bill [ Lords ] (Second sitting)
Thursday 6th February 2025
(1 day, 14 hours ago)
Public Bill CommitteesRead Full debate Crown Estate Bill [HL] 2024-26 View all Crown Estate Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 6 February 2025 - (6 Feb 2025)
The Committee divided: - Ayes: 3 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 4 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Committee divided: - Ayes: 2 / Noes: 9 - Question accordingly negatived.
The Chair
I remind the Committee that with this we are discussing new clause 4—Partnership agreement: the Crown Estate and Great British Energy—
“The Chancellor of the Exchequer must lay before Parliament any partnership agreement between the Crown Estate and Great British Energy.”—(James Wild.)
This new clause requires the Chancellor of the Exchequer to lay before Parliament any partnership agreement between the Crown Estate and Great British Energy.
James Murray
It is a pleasure to see you in the Chair, Mr Mundell. In his remarks, the shadow Minister essentially set out a similar question, rephrased in a number of different ways, about the publication of the partnership agreement between the Crown Estate and Great British Energy, and I would like to remind him of some of the points we discussed before lunch.
The Crown Estate is keen to ensure that details of the partnership are publicly available on an ongoing basis, and the Government agree that it is sensible to require the Crown Estate to include the relevant detail in its existing annual reports. I would also emphasise—I do not know whether the hon. Gentleman feels that this is less important than we do—that partnership agreements are highly commercially sensitive. It is therefore right that any agreement is not made public or laid before Parliament, as to do so would likely prejudice the commercial interests of the Crown Estate or GB Energy and risk the aims of the partnership, which are to speed up the process of delivering clean energy and investing in clean energy infrastructure.
Mr Andrew Snowden (Fylde) (Con)
The shadow Minister talked about the agreement being presented to the Public Accounts Committee in confidence. I am not sure how it would create commercial issues for GB Energy or the Crown Estate if the agreement was viewed in private by the Chair of the Public Accounts Committee and its members.
James Murray
We have considered the importance of making sure that the details of the partnership are publicly available. Because of the highly commercially sensitive nature of partnership agreements, the Government have set out that the way forward is to ensure that the commissioners include in their annual reports a summary of their activities, and of any effects or benefits resulting from their activities, under the partnership between the Crown Estate and GB Energy. We believe that that measure fulfils the aim of making sure that the information about the partnership is publicly available.
The work of GB Energy and the Crown Estate is very important for achieving some of the Government’s goals. They will work together to speed up the process of developing clean energy projects by co-ordinating planning, grid connections and leasing to de-risk projects for private developers to build. That will unlock private investment, speed up the deployment of clean energy infrastructure, boost energy independence, save costs for families, create jobs and tackle the climate crisis.
I hope that the Opposition would support some of those goals, although it was drawn to my attention that the shadow Minister campaigned against national grid infrastructure last year in his constituency. He teamed up with Liz Truss to do it; it was the shadow Minister and Liz Truss. Am I going to get sued now for having referenced that? I do not know whether the shadow Minister would like to express his regret at having campaigned against national grid infrastructure, which is obviously so important for the energy transition. Perhaps that is why this debate has touched a particular nerve on the Opposition Front Bench, but that is for him to say, not for me to speculate about.
What I do not have to speculate about, and what I can say with great certainty, is that the Great British Energy and Crown Estate partnership is very important for this Government, and the measures in clause 4 ensure that the relevant information is publicly available. I therefore commend the clause to the Committee.
Question put and agreed to.
Clause 4 accordingly ordered to stand part of the Bill.
Clause 5
Salmon farms on the Crown Estate
Question proposed, That the clause stand part of the Bill.
James Murray
Clause 5 would require the Crown Estate commissioners to assess the environmental impact and animal welfare standards of salmon farms on the Crown Estate on an ongoing basis. Where that assessment determines that a salmon farm is causing environmental damage or has significant animal welfare issues, the Crown Estate would be required to revoke the relevant licence. The commissioners would be required to make the same assessment of any applications for new licences for salmon farms, and where they determine that an application may cause environmental damage or raises significant animal welfare concerns, the Crown Estate must refuse the application.
During the Bill’s passage in the other place, peers felt it necessary to amend the Bill to add clause 5. The Government understand the objectives behind the clause, but we are unable to support it, as it would duplicate existing protections. Fisheries policy is also largely devolved, and therefore responsibility for this issue in Scotland, Wales and Northern Ireland rests with the relevant devolved Government. At present, virtually all salmon aquaculture in the UK takes place in Scotland, and the management of the Crown Estate in Scotland is also a devolved matter.
For those reasons, the clause would have almost no impact in practice on farmed salmon in the UK. As it stands, it risks impeding an already thoroughly regulated industry, while having little to no positive impact, due to the territorial realities of the Bill. Therefore, I do not recommend clause 5 to the Committee.
James Wild (North West Norfolk) (Con)
It is a pleasure to serve under your chairmanship again so soon, Mr Mundell. As the Minister noted, the clause was added in the other place, particularly following the efforts of my noble Friend Lord Forsyth of Drumlean. It was backed by peers from across the parties, and Labour peers may have supported it as well. The Minister says that it duplicates provisions that exist. Given that the Government said in the House of Lords that they support its objective, it is clearly disappointing to see them removing these provisions, with the message that that sends about the importance of protecting the future of wild Atlantic salmon.
Question put and negatived.
Clause 6
Commissioners with special responsibility
Question proposed, That the clause stand part of the Bill.
James Murray
Clause 6 amends the Crown Estate Act 1961 to require the appointment of commissioners with special responsibility for giving advice about England, Wales and Northern Ireland. That responsibility would be in addition to the other responsibilities of a commissioner. For appointments relating to Wales and Northern Ireland, no recommendation may be made to His Majesty, unless Welsh Ministers and the Executive Office in Northern Ireland have been consulted.
The legislative changes brought about by clause 6 ensure that those on the board of commissioners of the Crown Estate continue working in the best interests of Wales and Northern Ireland, alongside performing their existing duties as commissioners. The clause, which was added as an amendment, following Government support in the other place, will bring knowledge of the devolved nations even more directly to the board table and will supplement the expertise of the Crown Estate’s director for the devolved nations, who is based in its recently opened office in Cardiff. The clause will ensure that the board of commissioners of the Crown Estate continues working in the best interests of Wales and Northern Ireland. I therefore commend it to the Committee.
James Wild
This is a pretty straightforward clause. It is one of those that were added to the Bill in the other place to improve it, and I hope the Minister might learn the lesson of those clauses as we come to consider the new clauses shortly.
Question put and agreed to.
Clause 6 accordingly ordered to stand part of the Bill.
Clause 7
Extent, commencement and short title
James Murray
I beg to move amendment 3, in clause 7, page 4, line 4, leave out subsection (4).
This amendment removes the privilege amendment inserted by the House of Lords.
James Murray
These are very straightforward matters to debate. Government amendment 3 removes the privilege amendment inserted by the other place. Clause 7 sets out the Bill’s extent, commencement period and short title in the usual manner for such legislation. I commend Government amendment 3 and clause 7 to the Committee.
James Wild
Thank you for calling me to speak again, Mr Mundell—it is good to get the exercise. There is not much to add on this very straightforward clause and amendment, other than that the commencement date, which brings the legislation into force automatically within two years, could usefully be applied to other legislation from the last Parliament. Quite a lot of private Members’ Bills and other pieces of legislation were passed that have not been commenced. I could expand on that issue at length, Mr Mundell, but you would rightly say that it was not in scope. However, car parking regulations, for example, have not been brought into the code of practice or into effect. Having a clear date in legislation to say, “This will happen, as long as the Bill passes,” is a good thing to do.
Amendment 3 agreed to.
Clause 7, as amended, ordered to stand part of the Bill.
New Clause 2
Territorial seabed
“After section 3A of the Crown Estate Act 1961 (inserted by section 1 of this Act) insert—
‘3AA Restriction on permanently disposing of interest in seabed etc
(1) The Commissioners may not without the consent of the Treasury permanently dispose of—
(a) any part of the territorial seabed, or
(b) any interest, right or privilege over or in relation to the territorial seabed,
which forms part of the Crown Estate.
(2) Accordingly, without that consent, any purported disposal of a kind mentioned in subsection (1) is void.
(3) In subsection (1), “territorial seabed” means the seabed and subsoil within the seaward limits of the United Kingdom territorial waters.’”—(James Murray.)
This new clause requires the Crown Estate Commissioners to obtain consent from the Treasury before they permanently dispose of any of the Crown Estate’s interest in, or rights or privileges in relation to, the territorial seabed.
Brought up, and read the First time.
The Chair
With this it will be convenient to discuss new clause 3—Limit on the disposal of assets—
“After section 3 of the Crown Estate Act 1961, insert—
‘3A Limit on the disposal of assets
(1) The Commissioners must inform the Treasury if the disposal of assets of the Crown Estate will be of a value totalling 10% or more of the Crown Estate’s total assets in a single year.
(2) The Treasury must approve of any disposal of assets above the threshold in subsection (1) and the Chancellor of the Exchequer must lay a report before Parliament within 28 days of being notified by the Commissioners.’”
This new clause requires the Crown Estate Commissioners to notify and seek HM Treasury approval for the disposal of assets totalling 10% or more of the Crown Estate’s total assets.
James Murray
New clause 2 relates to the seabed, which is obviously an important asset held by the Crown Estate. Specifically, the clause will prevent the Crown Estate from selling the seabed without obtaining consent from the Treasury. During the Bill’s time in the other place, there was significant interest in the ability of the Crown Estate to dispose of unique national assets such as the seabed.
It will be no surprise to the Committee that the law on the ownership of the seabed is incredibly complex. As such, the Financial Secretary to the Treasury committed to explore the matter further and, if required, to bring forward a legislative provision to restrict the Crown Estate’s ability to sell the seabed.
I am pleased to say that the clause delivers on the commitment made by the Financial Secretary by putting special protections in place for the seabed. It does that by requiring the Crown Estate commissioners to obtain consent from the Treasury before they permanently dispose of any part of, or the Crown Estate’s interests in or rights and privileges in relation to, the territorial seabed.
Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
Could the Minister give examples of when the Crown Estate might consider selling the territorial seabed?
James Murray
I will come in just a moment to some of the scenarios that the new clause might cover.
As I said, the new clause ensures that the Crown Estate commissioners must obtain consent from the Treasury before they permanently dispose of any part of, or the Crown Estate’s interests in or rights and privileges in relation to, the territorial seabed. To be clear, that does not mean that the Crown Estate could never be permitted to dispose of a seabed. To answer my hon. Friend’s question, national or local interests may be best served by such a sale, including, for example, to another part of the public sector to enable local infrastructure development. Any such sale could, under these measures, take place only with the agreement of Ministers, and it is right that they are decision makers on such sales.
I should also make it clear that the clause would not fetter the Crown Estate’s existing right to agree licences or leases in relation to the seabed, which by definition do not represent a permanent disposal of the asset. The ability to agree long-term licences and leases for the seabed will continue to be an important feature of the Crown Estate, to attract significant investment needed for offshore clean energy developments.
New clause 3, tabled by the hon. Member for North West Norfolk, seeks to limit the ability of the Crown Estate to dispose of assets without Treasury approval. Specifically, it would require the Crown Estate to seek consent for the disposal of assets totalling 10% or more of its total assets in a single year, and that the Treasury lay a report before Parliament within 28 days of being notified of disposals above that threshold.
The Government’s view is that imposing a limit on disposals would undermine the flexibility needed to enable the Crown Estate to operate commercially and meet its core duties under the Bill. There may be instances where it makes commercial sense to dispose of high-value assets, particularly when the Crown Estate takes a long-term view of the business and its strategy.
I recognise that the new clause would not prohibit disposals above the specified limit, but would require the Crown Estate to obtain Treasury approval. However, as I have set out for the Committee, the Crown Estate is an independent commercial business, and it is not the Government’s intention to materially alter its independence in such a way that the Treasury is required to approve its business decisions.
However, I do understand that there may be concerns about the Crown Estate’s ability fundamentally to change the nature of the estate. I reassure the hon. Member that the core duty of the Crown Estate—to maintain an estate in land and to enhance and maintain the value of that estate—is unchanged by the Bill. I hope that that provides the appropriate reassurance and that he feels able not to press new clause 3.
The Government are thankful for the constructive engagement of the Opposition on the matter of disposals. That has led to special protections being put in place for the seabed. I therefore commend new clause 2 to the Committee.
James Wild
I will respond to Government new clause 2 and to new clause 3, which was tabled in my name. As we heard from the Minister, Government new clause 2 will require the Crown Estate commissioners to obtain consent from the Treasury before they permanently dispose of any of the Crown Estate’s interest in, or rights or privileges in relation to, the territorial seabed. The Government moved this measure because of the extensive debate in the other place about the sale of certain assets, and particularly the seabed. We welcome the constructive approach taken by Ministers; Lord Livermore gave a commitment in the other place, and it has been honoured today, so we will support the new clause.
Although we welcome the new clause, we still have concerns about the disposal of other assets. My new clause 3 would require the Crown Estate commissioners to seek approval from His Majesty’s Treasury for the disposal of assets totalling 10% or more of the Crown Estate’s total assets. It would also require the Chancellor to lay a report before Parliament within 28 days of being notified of such a disposal by the commissioners.
As previously noted in Committee, the Crown Estate owns some of the nation’s most vital assets. It is somewhat surprising to find that there are few safeguards to prevent the Crown Estate commissioners from deciding to sell critical assets. That is why the debate in the other place, which exposed the issue of the seabed and brought about new clause 2, was so important. However, the Crown Estate has lots of other assets, which Members may wish to refer to and which they may think also deserve special attention.
In the original business case for modernisation of the Crown Estate, which is publicly available, it was noted that the Crown Estate was planning £1.4 billion of disposals, which—coincidentally enough—equates to nearly 10% of its portfolio. In the other place, my noble Friends suggested a disposal limit of anything greater than £10 million. The noble Lord Livermore responded:
“It is the Government’s view that imposing a statutory limit on disposals in this way would undermine the flexibility required by the Crown Estate to ensure that it can operate commercially and fulfil its core duties under the future Act.”—[Official Report, House of Lords, 5 November 2024; Vol. 840, c. 1411.]
The Minister made a similar argument in his speech, but I am not sure that it is right. Given that the assets are held for the benefit of the nation, there should be some form of greater transparency if they are to be disposed of. Reporting to Parliament and seeking approval from the Treasury for disposals over a set percentage would provide such transparency.
The disposal of assets by the Crown Estate should be properly scrutinised, given its important role and statutory purpose. When I asked the Crown Estate about its planned disposals—the £1.4 billion referred to in document on the modernisation of the Crown Estate, which any Member may access—it said that it was unable to disclose its plans. Members might guess that the old “confidential, commercially sensitive” reason was given. That raises concerns about transparency. Will the Minister confirm whether he knows which assets were included in that figure and whether the Crown Estate plans further disposals? I asked the same question on Second Reading, and the Minister replied to most of my points, but that is one he did not reply to. Perhaps he will do so on this occasion.
Having reflected on the debates in the other place, we have changed our approach from a £10 million cap to a 10% cap, after which new clause 3 would require approval and a report to Parliament. That is a modest measure, which would not inhibit the commercial freedom of the Crown Estate to take such decisions if it wants to. It owns assets such as Great Windsor Park and others, and who knows which it may decide to sell at some point in the future? Such assets are held in right of the Crown, so this is not about the sovereign’s private income, but about the income generated for the taxpayer. Transparency is something that the Government should endorse.
James Murray
I thank the shadow Minister for his comments, but imposing a limit on disposals would undermine the flexibility needed to enable the Crown Estate to operate commercially and meet its core duties under the Crown Estate Act 1961. As I mentioned earlier, there may be instances where it makes commercial sense to dispose of high-value assets, particularly when the Crown Estate, by its nature, takes a longer-term view of the business and its strategy.
James Wild
The Minister talked about flexibility, but the Crown Estate would not suddenly decide tomorrow to sell some asset; it will have a business case and a process. That business case will go to the Chancellor, who will get advice rapidly—within a matter of hours or a day—either approve it or not, and report to the House. I do not see what the flexibility issue is.
James Murray
I point the shadow Minister to the way the system currently operates. The Crown Estate operates independently from Government, but there is a long-standing, constructive and transparent relationship between it and the Treasury. That ensures that the Government will be consulted on any potential sale of a nationally significant asset. That is underpinned by the Crown Estate’s framework document, which makes it clear that the Crown Estate should inform the Treasury
“of any matters concerning spending, income or finance that are novel, contentious or repercussive.”
That is an important point to highlight in terms of the way the system currently operates.
However, I return to my earlier point, which is that the Crown Estate is an independent commercial business, and it is not the Government’s intention to materially alter its independence in such a way that the Treasury is required to approve its business decisions. I reassure the shadow Minister and others on the Committee that the Crown Estate’s core duty, which is to maintain an estate in land and to enhance and maintain the value of the estate, is unchanged by the Bill.
Finally, to respond to the question about the £1.4 billion of disposals outlined in the business case, those published as part of the Lords stages relate to non-strategic assets.
Question put and agreed to.
New clause 2 accordingly read a Second time, and added to the Bill.
New Clause 3
Limit on the disposal of assets
“After section 3 of the Crown Estate Act 1961, insert—
‘3A Limit on the disposal of assets
(1) The Commissioners must inform the Treasury if the disposal of assets of the Crown Estate will be of a value totalling 10% or more of the Crown Estate’s total assets in a single year.
(2) The Treasury must approve of any disposal of assets above the threshold in subsection (1) and the Chancellor of the Exchequer must lay a report before Parliament within 28 days of being notified by the Commissioners.’” —(James Wild.)
This new clause requires the Crown Estate Commissioners to notify and seek HM Treasury approval for the disposal of assets totalling 10% or more of the Crown Estate’s total assets.
Brought up, and read the First time.
Question put, That the clause be read a Second time.
Llinos Medi (Ynys Môn) (PC)
I beg to move, That the clause be read a Second time.
The Chair
With this it will be convenient to discuss new clause 12—Devolution of Crown Estate powers to Wales—
“(1) The Crown Estate Act 1961 is amended as follows.
(2) After section 7 (powers of Minister of Works in Regent’s Park) insert—
‘7A Commissioners’ functions in Wales
(1) The Treasury must set out a scheme to transfer all the existing Welsh functions of the Crown Estate Commissioners (“the Commissioners”) to the Welsh Ministers or a person nominated by Welsh Ministers.
(2) The existing Welsh functions under subsection (1) are the Commissioners’ functions relating to the part of the Crown Estate that, immediately before the transfer date, consists of—
(a) property, rights or interests in land in Wales, and
(b) rights in relation to the Welsh zone.
(3) The Secretary of State must by regulations set a date to implement the scheme under subsection (1) to the transfer of functions to the Welsh Ministers or a person nominated by Welsh Ministers.
(4) A statutory instrument containing regulations under subsection (3) is subject to annulment in pursuance of a resolution of either House of Parliament.’”
This new clause would require the Treasury to devolve Welsh functions of the Crown Estate Commissioners to Welsh Ministers or a person nominated by Welsh Ministers.
Llinos Medi
The new clause places a duty on the Treasury to transfer management of the Crown Estate in Wales to the Welsh Government within two years of the commencement of the Bill. This would correct the glaring imbalance in the constitutional settlement of the UK whereby Wales is unable to direct and benefit from its own natural resources in the way that Scotland can. There is an overwhelming majority in favour of devolving the Welsh Crown Estate; it has been called for by the independent commission on the constitutional future of Wales, the national infrastructure commission for Wales and the Labour Welsh Government. I note, sadly, that the Welsh Government have failed to submit any written evidence in favour of devolution to this Committee.
Half of all Welsh councils have passed motions calling for the devolution of the Crown Estate, with more preparing motions for the coming weeks and months. Devolution is also supported by 58% of the population of Wales, according to the latest polling—a clear majority. The Government have argued consistently that devolution of the Crown Estate would “fragment the market”. I note that that is the same position as the previous Conservative Government, which is why the former Labour Secretary of State for Wales, Lord Hain, was right when he said, during the Lords Bill Committee, that this position
“reflects old, centralised, conservative, anti-devolution Whitehall thinking.”—[Official Report, House of Lords, 14 October 2024; Vol. 840, c. 18.]
Scotland is also a proof of concept that a devolved Crown Estate does not impede investment or fragment the market. If there can be a smooth and orderly transition of the management of the Crown Estate to Scotland, why not the same for Wales?
On Second Reading in the Commons, the Government argued that devolution would complicate existing processes and potentially delay grid connectivity reform, as well as the further development of offshore energy. Let me take those points in turn. First, with proper planning and a guarantee by the UK, working with the Welsh Government, to protect reserved interests, including the national grid, it would reduce the risk of impediments to ongoing reforms. That is why new clause 5 includes provision to ensure that the Treasury acts to secure reserved matters, such as the national grid, as part of the transfer of the management of the Welsh Crown Estate to the Welsh Government.
Secondly, on the potential further delays to offshore development in Wales, a devolved Welsh Crown Estate creates the opportunity for it to be strategically integrated into the planning of sub-sectors, including offshore wind in Wales. Looking again at Scotland, devolution has allowed for greater alignment between marine energy planning and licensing for renewable energy projects, such as offshore wind. With a devolved Crown Estate, the Scottish Government have taken a sectoral marine planning approach for offshore wind. They have made a specific plan for offshore wind development that provides the strategic frameworks for seabed leasing for commercial-scale offshore wind by Crown Estate Scotland. While England, Wales and Northern Ireland will have various forms of marine plans that the Crown Estate must have regard to, they cover a wide variety of policy areas and are not sector-specific.
The Welsh Government have a number of other areas that overlap with the responsibility of the Crown Estate in conducting early development of offshore wind. Those include their devolved responsibility over Welsh ports and responsibility for education in Wales, including skills and apprenticeships. These are crucial for the development of robust local supply chains for offshore wind projects. Wales could integrate a devolved Welsh Crown Estate into Welsh devolved plans and responsibilities, leading to a more strategic and joined-up approach to offshore development. In this way, devolving the Crown Estate is about not just profits from renewable licensing, but driving economic development in Wales. That would surely be a more attractive proposition to developers. The Government cannot continue to hide behind the excuse that devolution creates uncertainty. Yes, devolution will mean change.
Noah Law (St Austell and Newquay) (Lab)
Does the hon. Member recognise that the potential devolution of the Crown Estate in Wales could cause no end of issues for the fair distribution of supply chain and economic benefits in communities, alongside their Celtic neighbour in Cornwall, for example?
Llinos Medi
That is why we have asked for a two-year approach, so that we can work together. It has happened in Scotland and it is possible. I think it is only fair that we ask the new UK Government, who want to devolve local authorities and regions in England, for devolution of the Crown Estate in Wales as well. It was another Labour Secretary of State, Ron Davies, who said:
“Devolution is a process. It is not an event and neither is it a journey with a fixed end point. The devolution process is enabling us to make our own decisions and set our own priorities, that is the important point.”
I urge this Labour Government to heed those words and support my amendment to devolve the Crown Estate to Wales.
Pippa Heylings (South Cambridgeshire) (LD)
I will speak to new clause 5 and to new clause 12 which calls for the devolution of the Crown Estate to Wales. While Scotland has controlled its Crown Estate since 2017, Wales has been left without these powers, despite the fact that vast Crown Estate assets lie within its borders. It is time to correct that unbalance and bring Wales into line with Scotland. Devolving control of the Crown Estate would not only recognise Wales’s status as an equal nation, but deliver substantial economic benefits to communities across Wales. Under the current system, profits from the Crown Estate flow directly to the UK Government.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
As my hon. Friend the Member for St Austell and Newquay partially explained, there is an issue relating to, for example, the Celtic sea, where the Crown Estate has great interest in floating offshore wind. That lies between Wales, Cornwall and the south-west, so where would the line be drawn? It would open up a huge number of complexities that would be very difficult to solve.
Pippa Heylings
Nobody is saying that this is easy, but it is possible, and it has happened with Scotland. As many Members have said to us, given that we have territorial devolution and powers over the land, why not the seabed as well? There are ways of managing this, so complexity should not get in the way of ensuring that we have fairness in the distribution of economic benefits.
This funding is desperately needed, particularly given the historical underfunding of Wales on issues such as infrastructure. The success of devolution in Scotland speaks for itself; since 2017, when Scotland gained control of the Crown Estate, it has generated more than £103 million for public finances, so let us think what could happen for Wales if it was able to retain the profits generated by the Crown Estate within their borders.
Wales is expected to generate at least £1 billion from offshore wind energy leases in the coming years alone. Keeping some of that money within Wales could add £50 million a year to the Welsh Government’s budget—funds that could be directly reinvested in public services and local communities.
But this is not just about the financial gain; as the hon. Member for Ynys Môn said, devolving the Crown Estate would open up opportunities for greater investment in renewable energy projects. That is particularly important for coastal communities, which have long suffered from the decline of traditional industries. When they see direct benefits from renewable projects, they are far more likely to support them. That would create jobs, opportunities and sustainable development, delivering long-term economic stability, especially for the coastal regions of Wales that need it most.
The devolution of the Crown Estate has widespread support across Wales, from the Liberal Democrats in this place and the Welsh Parliament to Plaid Cymru, a majority of local authorities in Wales and even to the Welsh Labour Government. There is clear and overwhelming backing. In addition, opinion polls consistently show that the majority of the Welsh public are in favour of seeing the Crown Estate devolved, and it is clear that the people of Wales want to see this change. We want to work together, and I urge the Government to support this new clause and allow Wales to benefit from the powers and financial resources that it so rightly deserves.
James Wild
I will not detain the Committee for long. The hon. Member for Ynys Môn referred to the previous Conservative Government’s position, which has not changed today. The proposal would introduce an element of risk in spinning out assets and revenue streams. We heard about the particulars of the Celtic sea, so this is not the right proposal for this time.
James Murray
I thank the hon. Member for Ynys Môn for tabling new clause 5, which would require that within two years of the day on which the Act commences, the Treasury must have completed a transfer of the responsibility of the management of the Crown Estate in Wales to the Welsh Government. It would allow the Treasury, by regulations, to make provision about the transfer relating to reserved matters as necessary, and would require it to make provision to ensure that the employment of any person in Crown employment is not adversely affected by the transfer of responsibility.
I also thank the hon. Member for South Cambridgeshire for tabling new clause 12, which would require the Treasury to set out a scheme to transfer all existing Welsh functions of the Crown Estate commissioners to Welsh Ministers or a person nominated by Welsh Ministers. The Welsh functions would consist of the property, rights or interests in land in Wales and rights in relation to the Welsh zone.
The Government believe there is greater benefit for the people of Wales and the wider United Kingdom in retaining the Crown Estate’s current form. Both new clauses would most likely require the creation of a new entity to take on the management of the Crown Estate in Wales which, by definition, would not benefit from the Crown Estate’s current substantial capability, capital and systems abilities. It would further fragment the UK energy market by adding an additional entity and, as a consequence, risk damaging international investor confidence in UK renewables and disrupting the National Energy System Operator’s grid connectivity reform, which is taking a whole-systems approach to the planning of generation and network infrastructure. Its reform aims to create a more efficient system and reduce the waiting times for generation projects to connect to the grid.
Llinos Medi
For clarification, does that plan not include Scotland, which has already been devolved?
James Murray
I thank the hon. Lady for that question, but we must consider the proposal before us in terms of the situation we face now, rather than consider decisions that have been made in relation to another nation in the past. We are considering not only the challenges but the opportunities for generating renewable energy in connection with assets closer to Wales or closer to England. The Government believe that having a united approach, through retaining the Crown Estate’s current form, is the best way to improve lives for people in Wales and across the rest of the UK.
As I was saying before the hon. Lady intervened, our reforms aim to create a more efficient system and reduce the waiting times for generation projects to connect to the grid. I am sure she would not want to see those waiting times increase. The cumulative impact of the changes that she and the hon. Member for South Cambridgeshire are suggesting in their new clauses would likely significantly delay the pathway to net zero.
Furthermore, the Crown Estate’s marine investments are currently made on a portfolio-wide basis across England and Wales. To devolve to Wales would disrupt the existing investments, since they would need to be restructured to accommodate a Welsh-specific entity. To devolve the Crown Estate at this time would risk jeopardising the existing pipeline of offshore wind development in the Celtic sea planned into the 2030s. The Crown Estate’s offshore wind leasing round 5 is spread across the English and Welsh administrative boundaries in the Celtic sea. It was launched in February last year and is expected to contribute 4.5 GW of total energy capacity, or enough to power 4 million homes.
In addition to energy, the extensive jobs and supply chain requirements of round 5 will also likely deliver significant benefits for Wales and the wider UK. Lumen, an advisory firm to the Crown Estate, has estimated that manufacturing, transporting and assembling the wind farms could potentially create around 5,300 jobs and create a £1.4 billion boost for the UK economy.
Devolution would also delay UK-wide grid connectivity reform. The Crown Estate is using its data and expertise as managers of the seabed to feed into the National Energy System Operator’s new strategic spatial energy plan. For Wales, the Crown Estate is working in partnership with the energy system operator to ensure that its current pipeline of Welsh projects, the biggest of which is the round 5 offshore wind opportunity in the Celtic sea, can benefit from this co-ordinated approach to grid connectivity up front. It would not make commercial sense to introduce a new entity, with control of assets only within Wales, into that complex operating environment, where partnerships have already been formed. Furthermore, the Crown Estate’s assets and interests in Wales, as compared with its assets in England, are of a fundamentally smaller magnitude, which would likely not be commercially viable if the costs were unsupported by the wider Crown Estate portfolio.
The Crown Estate, in its present form, has the ability to take a longer-term approach to its investments and spread the costs of those investments across its entire portfolio. A self-contained, single entity in Wales would not have the same ability, nor would it benefit from the expertise that the Crown Estate has developed over decades in delivering offshore wind at scale. A devolved entity would be starting from scratch, midway through a multimillion-pound commercial tendering process, at a time when the Crown Estate is undertaking critical investment in the UK’s path towards net zero.
For example, the commercial viability of all three 1.5 GW floating offshore wind project development areas in the Celtic sea, which straddle the English and Welsh administrative boundaries, benefited from the Crown Estate’s significant investment of time, expertise and capital to enable entry to market. UK floating offshore wind, which is an emerging offshore technology that the Crown Estate is supporting, would be particularly vulnerable to market disruption.
It is also important to underline that income generated by the whole Crown Estate benefits the people of Wales. As I have noted, the Crown Estate pays its entire net profits into the UK Consolidated Fund each year. That means that much of the revenues already support public services in Wales, either through supporting UK Government spending in reserved areas or through the funding provided under the operation of the Barnett formula and the Welsh Government’s block grant funding.
Perran Moon (Camborne and Redruth) (Lab)
On that point, does the Minister agree that a lot of the concern and anxiety expressed so far stems from the idea of huge opportunities for revenue generation by the Crown Estate passing through deprived rural coastal communities and going to the Treasury? Will he comment on how a place like Cornwall, which is not subject to the Barnett formula, will benefit from all the resources from something like the Celtic sea?
James Murray
My hon. Friend is absolutely right that a collective approach to projects such as those in the Celtic sea, which cross English and Welsh administrative boundaries, can increase a return for the UK Consolidated Fund, which benefits people in Cornwall, Wales and other parts of the UK. It ensures that we get the best return on our investment through Crown Estate activities. Our concern about the proposition in the new clauses is that it would undermine such revenue generation for all our public services, as well as disrupting the emerging market in offshore floating wind at a critical time, when what investors need is stability, certainty and confidence to invest in a growing sector, not organisational change that might undermine the investment they seek to make.
To pick up further the point made by my hon. Friend the Member for Camborne and Redruth, were Wales to benefit only from the income generated in Wales, it would likely receive zero or negligible benefits for several decades to come, because Welsh assets are relatively new and it will take them time to mature—in the order of 10 to 15 years. The Crown Estate has shown itself to be a trusted and successful organisation, with a proven track record in effective management and profit generation, which are valuable outcomes that we need to be careful not to undermine.
As I set out earlier, the Government supported the inclusion of clause 6, which will require the appointment of a commissioner responsible for giving advice about Wales. I will not repeat what I have already set out, but it is important to underline that that will help to ensure that the board of commissioners for the Crown Estate continue to work in the best interests of Wales, alongside their existing duties as commissioners. That will certainly strengthen the Crown Estate’s ability and mission to deliver benefits for the whole UK.
I am aware that hon. Members may not agree with the points I have made, but I hope that I have set out clearly why the Government believe the existing structure remains the best approach. I hope hon. Members feel able not to press their new clauses.
Llinos Medi
I thank the Minister for those comments; I will come back on a few of them.
This debate is about fairness. We are asking for fairness and equity for Wales, and parity with Scotland. It is important to give a bit of history. Our natural resources in Wales have been extracted from our communities yet, as I mentioned earlier, by the end of this decade 34% of children in Wales will live in poverty. If the money we are discussing was spent back in Welsh communities, it would have a dramatic effect.
Llinos Medi
I beg to move, that the Clause be read a Second time.
The new clause would require the Crown Estate commissioners to transfer all profits generated by the Crown Estate in Wales to the Welsh Government on an annual basis. Although figures for the profits generated in recent years by the Welsh Crown Estate are not available, the figures from across the whole Crown Estate show that overall profits have increased dramatically. Since 2021, there has been a 408% increase in Crown Estate profits and therefore the profits from Wales have likely seen a similar level of increase.
Even if one accepted the Government’s argument that devolution of the management of the Crown Estate would involve too much risk, that does not justify profits generated on assets in Wales not remaining in Wales. Therefore, will the Government outline whether they support the principle that all profits generated through Welsh natural resources should be kept in Wales, as is the case with Scotland?
Some argue that Wales would not benefit financially from the devolved Crown Estate given the impact on the devolved Welsh budget. However, the Scottish model already demonstrates how profits from the Welsh Crown Estate could interact with the devolved Welsh budget. In Scotland, all profits from the Scottish Crown Estate are paid into the Scottish Consolidated Fund and redistributed for public spending. These profits interact with the Scottish block grant adjustment mechanism, which was agreed with the Treasury under the 2016 Scottish fiscal agreement.
The mechanism removes a portion of the block grant as the profits from the Scottish Crown Estate increase, to avoid Scotland gaining twice over. That is due to the Scottish budget benefiting from a Barnett share of the expenditure in England, supported by Crown Estate revenues arising from England, Wales and Northern Ireland. Crown Estate Scotland has estimated that net revenue profits in 2023-24 will be £113.5 million. The current reduction to the Scottish block grant under the adjustment mechanism will be £10 million, which should result in an estimated usable revenue from the Crown Estate Scotland for the Scottish Government of £103.5 million.
If Wales followed a similar approach to Scotland, it would likely gain additional revenues from the Crown Estate and would have only a small proportion removed from its block grant in return. That would occur through a Welsh block grant adjustment mechanism to be negotiated between the Welsh Government and the Treasury. Will the Government look at opening discussions with the Welsh Government on retaining profits in Wales and establishing a fair block grant adjustment mechanism to account for rising profits over time? It would be up to the Welsh Government to decide what to do with the money from the Crown Estate.
Plaid Cymru has proposed targeting investment into deprived communities in rural Wales and our deindustrialised valleys, and using the money to develop a Welsh sovereign wealth fund. However, that is not within the scope of the new clause. I hope the Government will listen and agree to the new clause, thereby endorsing the principle that profits generated in Wales should remain in Wales.
James Wild
I am up now. I will not detain the Committee long. We did not support new clause 5, so it follows that we do not support new clause 6, although it raises a thought in my mind. The east of England, which is home to the largest offshore wind sites in Europe, is perhaps not getting its fair dibs. That is probably something I need to reflect on for another time.
James Murray
I thank the hon. Member for Ynys Môn for tabling new clause 6, which would require that the commissioners must transfer all net revenue profit generated from the Crown Estate’s activities in Wales to the Welsh Government on an annual basis. As The Crown Estate’s operations are not divided into business units for each nation, calculating the exact net profit figure attributable to Wales is not straightforward, because most of the associated costs cannot easily be disentangled from the Crown Estate’s overall costs and would, in places, require subjective judgment.
Furthermore, as I set out earlier, given that the Crown Estate takes a long-term approach to investments, it is anticipated that its investments in Wales could take up to 10 to 15 years to see an appropriate return. Therefore, if net profits were transferred to the Welsh Government now, they are likely to be zero or negligible. I hope that explanation was helpful and that the hon. Member feels able to withdraw the new clause.
Llinos Medi
I am unsure how the Minister can say that we would not receive any profits when the Government cannot work out what profits Wales generates. It feels a bit difficult to understand that argument.
I am fighting the corner for fairness for Wales. We have lost all our natural resources and that has been feeding the UK machine. Unfortunately, we are seeing poverty on the rise and deindustrialisation in communities. The new clause would see the profits that are generated given back to those communities, to be spent in those communities and on their future.
Question put, That the clause be read a Second time.
The Chair
With this it will be convenient to discuss the following:
New clause 8—Publication of lease fees—
“In section 2 of the Crown Estate Act 1961 (reports and accounts), after subsection (4) insert—
‘(4A) In their accounts the Commissioners must publish details of all individual lease agreements with public bodies in—
(a) Wales,
(b) England, and
(c) Northern Ireland.
(4B) The information provided under subsection (4A) must include the value and name of the agreement.’”.
This new clause requires the Crown Estate to publish, in its annual accounts, a list of all lease agreements it has with public bodies in Wales, England and Northern Ireland including each lease’s name and valuation.
New clause 9—Publication of separate reports for England, Wales and Northern Ireland—
“In section 2(1) of the Crown Estate Act 1961, at end insert—
‘(1A) In addition to the report under subsection (1), the Commissioners shall produce a report on the performance of their functions each year in each of England, Wales and Northern Ireland.
(1B) The Commissioners shall lay—
(a) a copy of the report in relation to England before both Houses of Parliament,
(b) a copy of the report in relation to Wales before Senedd Cymru, and
(c) a copy of the report in relation to Northern Ireland before the Northern Ireland Assembly.’”.
The new clause would require that the Crown Estate Commissioners report separately for each country and for the devolved legislatures to have the report laid before them.
Llinos Medi
I note that since 2021 the net revenue profit and asset value data for Wales has not been published by the Crown Estate. The Crown Estate says that the reason for this is that:
“While in the past, we have produced illustrative figures for Wales, we have since shifted our focus to a more holistic approach to assessing value and increasing our investment, and we realise that such figures are not a fair reflection of value. The previous Wales numbers we published have not included a cost allocation.”
In an answer from September 2024 to my written question asking about the merits of producing regular disaggregated assets and revenue data for Wales, the Government said:
“To achieve efficiency in its operations, the Crown Estate runs many of its functions at a whole enterprise level. As a result, separate financial statements for Wales would not reflect the fact that expenditure is incurred for the benefit of the whole portfolio, and it is not possible to disaggregate net revenue profit attributable to Wales.”
I also note that the Government accepted an amendment to the Bill in the House of Lords to include national commissioners for England, Wales and Northern Ireland on the board of the Crown Estate. The amendment also grants Welsh Ministers and the Executive Office in Northern Ireland the right to be consulted about the Welsh and Northern Irish appointments. Therefore, can the Government outline how these national commissioners will be able to advise on the affairs of each respective nation if there is no process by which the Crown Estate can measure and delineate the profits and costs incurred separately in England, Wales and Northern Ireland?
New clause 7 would address this gap by requiring annual reporting of both asset value and revenue across all nations under the Crown Estate, and by doing so, it would require the Crown Estate to develop a way to measure asset value and revenue in a consistent manner. I hope the Government will accept this amendment to strengthen the ability of national commissioners to fulfil their intended role to advise and act in the interests of the nations they represent on the Crown Estate board.
I turn to new clause 8. Under the current arrangements, many public bodies, such as local authorities, pay lease fees to the Crown Estate simply to lease the land in their own area. However, details of these are not routinely published. In response to my written question in October 2024, the Government noted that,
“Publishing details of those fees would risk prejudicing the commercial interests of both The Crown Estate and the local authorities involved.”
However, local authorities are able and willing to provide this information through freedom of information requests. These FOIs have revealed that in 2023 local authorities in Wales paid fees amounting to well over £300,000 a year. At a time when council budgets are under enormous pressure, how can these fees be justified? This is public money that vital council services such as housing, education and social care are being deprived of.
We should be having a debate on the merits of these fees. This has to start with total transparency and a full account of what is being charged and where. That is why I have tabled new clause 8, which requires the Crown Estate to publish in its annual accounts a list of all lease agreements it has with public bodies in Wales, England and Northern Ireland, including each lease’s name and valuation. I ask the Government to support my new clause for the sake of transparency and to agree that, where public money is being spent, the public should be able to see where this money is going.
New clause 9 is similar to new clause 8. It would require that the Crown Estate commissioners report separately for England, Wales and Northern Ireland, and that the devolved legislatures have these reports laid before them. The Crown Estate already produces highlights reports for Wales and Northern Ireland. This amendment would place this type of reporting on a statutory footing by ensuring that these reports are made available to both the Senedd and the Northern Ireland Assembly, and would allow for greater transparency and engagement between the Crown Estate and the devolved legislatures. Diolch.
James Murray
New clause 7, tabled by the hon. Member for Ynys Môn, would require the Crown Estate to disaggregate reporting in its accounts to show capital and revenue figures for the activities of the Crown Estate in England, Wales and Northern Ireland. At present, the Crown Estate’s operations are not divided into business units by nation. It would therefore not be straightforward to disaggregate reporting in that way. It would be a complex task, requiring a series of highly subjective judgments to be taken. Although it is possible to identify gross revenues from each nation, reporting them without any representation of the costs associated would be entirely misleading. However, the Crown Estate does publish broader information relating to its activities in England, Wales and Northern Ireland as part of its annual report and accounts. The Government’s view is that it remains appropriate for the Crown Estate to continue its reporting on a whole-business basis. I hope that that explanation is helpful and encourages the hon. Member to withdraw her new clause.
Llinos Medi
This is a leadership discussion—it is about the leadership we are asking the Government to show in giving Wales the fairness it deserves. We are asking for clarity around public money. I am a bit concerned that there should be a commercially sensitive discussion around public money, which is meant to be transparent. We can get it through freedom of information requests, so it should be easy to collate that information so that the people of Wales and across the United Kingdom can see how their local authorities are spending their money on the Crown Estate and where that is spent afterwards.
In addition, I am unclear about the role of the commissioners. The information that we are asking for in these new clauses would strengthen the role of the commissioners and give them the ability to fulfil their role for the benefit of those regions whose concerns they are there to voice. I will press this matter to a vote.
Question put, That the clause be read a Second time.
The Chair
My decision is that new clause 12 is sufficiently similar to new clause 5 as not to justify a separate vote, so we will move on to the remaining procedures.
Question proposed, That the Chair do report the Bill, as amended, to the House.
James Murray
May I take this moment to thank all hon. Members on both sides of the Committee for their attendance and their contributions? I also thank you, Mr Mundell, for chairing the Committee. I thank the Treasury officials, the House of Commons officials and everyone else for making the Committee run so smoothly.
James Wild
I am grateful, Mr Mundell, for your chairing this afternoon, and I am grateful to Ms Furniss for chairing the first session this morning. I am grateful for the support, help and advice of the Clerks and for the contributions and responses provided by the Crown Estate during the passage of the Bill. I look forward to reconvening with Members for its remaining stages, which I understand will be on 24 February—they will be a pleasure. I am grateful to the Minister for getting on the record my strong opposition to the 100 miles of pylons coming from Grimsby to Walpole in my constituency and the need to look at underground options.
The Chair
As ever, it is a disappointment to me that I can take no further part in these proceedings.
Question put and agreed to.
Bill, as amended, accordingly to be reported.
Children's Wellbeing and Schools Bill (Twelfth sitting)
Thursday 6th February 2025
(1 day, 14 hours ago)
Public Bill CommitteesRead Full debate Children’s Wellbeing and Schools Bill 2024-26 View all Children’s Wellbeing and Schools Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 6 February 2025 - (6 Feb 2025)
The Committee divided: - Ayes: 3 / Noes: 12 - Question accordingly negatived.
Neil O'Brien (Harborough, Oadby and Wigston) (Con)
I beg to move amendment 85, in clause 51, page 111, line 7, after “authorities” insert “, including academy trusts,”.
The Chair
With this it will be convenient to discuss the following:
Amendment 48, in clause 51, page 112, line 4, at end insert—
“(5) After section 7A (withdrawal of notices under section 7), insert—
“7B New schools to allocate no more than half of pupil places on basis of faith
A new school for which proposals are sought by a local authority under section 7 must, where the school is oversubscribed, provide that no more than half of all places are allocated on the basis of or with reference to—
(a) the pupil’s religious faith, or presumed religious faith;
(b) the religious faith, or presumed religious faith, of the pupil’s parents.””.
Clause stand part.
Neil O'Brien
It is a pleasure to serve under your chairmanship, Sir Christopher. I will begin by asking a question up front, so that the Minister has time to confer with officials if she needs to in order to reply.
We learned during the debate on clause 50 that, as well as existing schools, local authorities will be able to go to the schools adjudicator regarding school openings. Will a local authority be able to object to the published admissions number of a school in another local authority, or is it limited to schools within its own area? Possible answers are: yes, they will be able to object about another authority; no, they will not be able to; or, the Government have not decided yet. As drafted, the Bill does not tell us what the Government’s intent is.
I will now speak to our amendment 85 and clause 51. Local authorities can already establish local authority schools if there is really no one who wants to start a new school, although, as the Government’s notes to the Bill rightly say, the current legal framework for opening new schools is tilted heavily towards all new schools—mainstream, special, and so on—being academies. As we have discussed, clause 44 repeals the requirement to turn failing local authority schools into academies; clause 51 is effectively the other half of that shift away from academisation. It ends the rule that new schools must be academies and allows local authorities to choose to set up new local authority-run schools instead. Both changes will reduce the flow of new schools into the best performing trusts. For that reason, we think it is a mistake.
Ministers keep saying that they want greater consistency —that seems to be one of the guiding principles of the Bill—but in the long term the combination of clause 51 and clause 44 will leave us with two types of school. That will sustain the confusion that we talked about in previous debates, where the local authority is simultaneously the regulator and a provider in the market it is regulating. The schools system is currently a halfway house: more than 80% of secondary schools are now academies, but less than half of primaries are, so just over half of all state schools are academies, and most academies are now in a trust.
I understand why Ministers have moved to find a legislative slot, and I know that anti-academies campaigners and people who do not like academies will welcome the clause. My question is where this is taking us in terms of a structure for the system as a whole. The Minister will say, “We want the flexibility to set up local authority schools,” but the combination of clauses 44 and 51 means that, in the long term, we will continue to have two types of school, rather than continue the organic move of recent years toward a system that is clearly based on academies and trusts, and trusts as the drivers of overall performance. That became apparent during the Government’s announcement the other day of their consultation on the new intervention regime. Ministers are now talking about RISE—regional improvement for standards and excellence—as one of the drivers of school improvement, leading to lots of questions about where the balance is between RISE and trusts, and what happens where the advice of a RISE team contradicts a trust’s views about what should be done in the case of a school with problems.
We have rehearsed a lot of these issues before, but I am keen to get an answer from the Minister about whether, in the case of new school openings in a different local authority, another local authority would be able to send the question of that school’s PAN to the schools adjudicator under clause 50. I am also keen to get the Minister’s sense of the finality of the system. Are Ministers happy for us to have just local authority schools and academies in the long term, and do not think that that is a problem they need to address? Do they not have a vision for the final situation, or do they have some other vision that the Minister wants to set out?
Ian Sollom (St Neots and Mid Cambridgeshire) (LD)
It is a pleasure to serve under your chairmanship, Sir Christopher. Broadly, the Liberal Democrats welcome clause 51 and its counterpart, not least because we desperately need new special schools. The previous Government approved fewer than half of the 85 applications from councils to open SEND free schools in 2022. This is a real part of unblocking that, so we agree with the Government. We tabled amendment 48 because a potential loophole is created in the now well-established rules on faith-based selection. Those rules apply to academies and will continue to do so, but under clause 51 not all new schools will be academies. The amendment would bring all new schools into line with the current established principles of faith-based selection for academies. It is a very simple amendment. I think the error was made inadvertently during drafting, and hopefully the Government will support it.
Lizzi Collinge (Morecambe and Lunesdale) (Lab)
I rise to speak to clause 51, because there are some points I wish to raise about this part of the Bill allowing new schools to have 100% faith selection.
Clause 51 allows new schools to be opened without ideological restrictions on their type; they could be academies, community schools or voluntary aided schools, which in my view is extremely welcome; but it also creates the ability to open new 100% faith-selective schools, which worries me. The current 50% cap on faith selection for academies was introduced by the Labour Government in 2007, and further embedded into free schools in 2010 by the coalition Government. The Education Act 2011 mandated that all new schools must be free schools, extending the cap’s reach. That 50% limit was supported by all three main parties.
A scheme of local authority competitions similar to the one proposed in the clause operated from 2007 to 2012, in which we saw 100% faith-selective schools open. For example, Cambridgeshire county council ran a competition for a new school in which a 100% selective Church of England school won out over a proposal for a school with no religious character; the resultant school opened in 2017 and is still 100% faith selective. Another 100% religiously selective school was approved in the Peterborough council area. This has happened when the legislation has allowed for it.
We heard in the first evidence session that the Catholic Education Service would seek, in areas of oversubscription, to use 100% faith selection. We heard from the Church of England that nationally its policy is to stick to 50%, but its structure means that dioceses can put forward proposals for new schools, and they are not bound by that national policy. Members might be sitting here thinking, “So what? What is the problem with 100% faith-selective schools?” The problem is that 100% faith-selective schools are less socioeconomically diverse than might be expected for their catchment area, and less socioeconomically diverse than schools that are subject to the 50% cap. Compared with their 50% selective peers, 100% faith-selective schools are also less ethnically diverse than would be expected. Faith selective schools remain less inclusive across multiple factors. In my view, 100% faith selective admissions only exacerbate inequalities in the school system.
The Sutton Trust found that faith schools are less inclusive of disadvantaged children. The Office of the Schools Adjudicator found that faith-selective schools are less inclusive of children in care. The London School of Economics found that faith-selective schools are less inclusive of children with special educational needs and disabilities. Faith-selective admissions also disproportionately favour wealthier families, because they are socioeconomically more selective than other types of school. Compared with other schools, faith-selective schools admit fewer children eligible for free school meals than would be expected for their catchment area.
Many faith-selective schools operate a system of scoring for religious attendance and volunteering. In my view, this activity is simply easier for those with more economic or social capital—those who do not work weekends, nights or shifts, and who have a professional background where one is very happy and comfortable going into a new environment; perhaps one went to church as a child. At least since the 1950s, data shows that church attendance is higher among wealthier people. This religious activity is less easy to take part in for those who work shifts or weekends and those who do not have the cultural or social capital to enter confidently a situation that is new or perhaps culturally alien. I am focusing on church attendance because the religious majority in our country is Christian, even though actual religious belief is low.
Faith-selective schools encourage and embed educational inequalities, and that is why I am concerned about lifting the 50% faith-selection cap. I merely ask Ministers to consider this.
Damian Hinds (East Hampshire) (Con)
I rise to speak to amendment 48, which stands in the name of the hon. Member for Twickenham. There are two main reasons people seek to limit school admissions on the basis of faith. The first is that some people do not like religion, organised religion, or the involvement of the state with organised religion. That is a matter of belief for some people. The second is that it is sometimes said that faith-based admission policies shut out others from good schools. There is sometimes a sense that it is academic or social selection by the back door. The hon. Member for Morecambe and Lunesdale alluded to that. Some people—I am not saying this is the case with the hon. Lady—talk about the second issue when really they have in mind the first. One can be a proxy for the other.
Damian Hinds
Before the hon. Lady corrects me, I did not say she was doing that.
Lizzi Collinge
I do not wish to correct the right hon. Gentleman. I believe he is correct that the two get confused. I have both of those beliefs.
Lizzi Collinge
However I am very clear the evidence I am quoting is on the second of those. I would happily provide the right hon. Gentleman with the sources of evidence, should he like to peruse them.
Damian Hinds
I understand, acknowledge and respect what the hon. Lady says but, believe me, I do not need to see any more evidence on this subject, on which I have in my time perused large volumes. It is one of those issues—we talked the other day about another one—where the answer one wants can be found in the data.
Let us step back a moment. All liberal democracies permit freedom of religious belief, but the way it manifests is different in different countries. There can be an approach such as that in the United States or in France, where secularism in education is written into law or the constitution. We in this country have taken a different approach. We have always allowed denominational schools. In fact, we have not just “allowed” it; denominational schools and faith schools have always been a key part of the system. The biggest name in primary education in Britain is the Church of the England; the biggest name in secondary education in England is the Catholic Church.
It is not just in education that our country has this tradition. In international development, for example, the Government work closely with organisations such as Christian Aid, World Vision and the Catholic Agency for Overseas Development. In children’s services, the Children’s Society used to be called the Church of England Children’s Society, and Action for Children, formerly National Children’s Home, has its roots in Methodism.
Before there were state schools, there were faith schools, often attached to monasteries or cathedrals. The Education Act 1944 formalised this position, sometimes known as the dual system, whereby faith schools could be a full part of the state school system while retaining their religious character. There is a distinction between what are known as voluntary aided schools and voluntary controlled schools, and different degrees therefore of independence for those two. VA tends to be mostly associated with the Catholic Church, but there are lots of Anglican VA schools, and VA schools of five or six other religious denominations as well.
It is understood traditionally and generally, but not entirely correctly that with a VA school, the Church provides the land and the state provides the building, and that there is a sort of co-ownership—it is obviously minority ownership on the part of the religious organisation. In reality, over time that system was eroded and changed to a cash contribution in which, typically, 10% would come from the Church, which then became 5%. I think there were some cases in which it was 0%, but broadly that tended to be the situation. Sometimes Churches complain about that, saying, “Why should we have to contribute to this school, when any other school being created is fully funded by the state?” I think that is a good rule for two reasons. First, it is a privilege to be able to have a school that is fully state funded for pupils within a faith, but it is also a guarantee of independence. It means that no future Government can come along and say, “We are going to change all these schools into fully secular schools,” because they are part-owned—albeit a small part—by that religious faith.
Lizzi Collinge
Does the right hon. Gentleman agree that the question of schools having a faith element, being run by a Church or by any faith group, is different from the question of whether, in their admissions policy, a school may discriminate against one child and in favour of another based on the professed faith of their parents? Does he agree that those are two separate issues?
Damian Hinds
They are different but related issues. For the avoidance of any confusion, when we talk about schools being “run” by a Church, there was a time when clerics ran schools, but things are not really done in that way today.
Some of the top-performing schools in the country are denominational schools with faith-based admissions. There are some very poor-performing faith schools and some brilliantly performing non-faith schools, and obviously it varies from year to year, but on average, faith schools tend to slightly outperform the average. The hon. Lady can correct me if I am wrong, but there is a feeling that this is where she and others get the idea that that is possible only if there was some unfairness in the intake of children the schools accept.
Damian Hinds
I suppose, having said that the hon. Lady can correct me, I cannot really stop her.
Lizzi Collinge
The right hon. Gentleman is being very generous with his time. It is not a belief that the profile of faith schools is different from other schools: it is true. If we look at the rates of free school meals and the wealth profile of parents and compare them with peers—if we compare apples with apples—the data shows that. Does he recognise that?
Damian Hinds
As I said earlier, there are all manner of datasets. I do not have my full Excel complement with me today, but I can trade with the hon. Lady and counter what she said with other statistics. In particular, anybody who suggests that the intake of a Catholic school is higher up the socioeconomic scale than the average does not know a whole lot about the demographics of the Catholic population in this country. We have a remarkable amount of ethnic diversity because of immigration patterns.
By the way, there is no such thing as 100% faith selection; that happens only if a school is oversubscribed. If a state-funded school has spare places, at the end of the day, it is obliged to let anybody come along. However, if a school is oversubscribed and we lose the faith admissions criterion, the nature of the school will change. That goes to the heart of the hon. Lady’s question. There is something intrinsic to having a faith designation and a faith ethos in a school. Some people—I accept that the hon. Lady is not one of them—believe that such things contribute to what happens to those children, their education and their wellbeing, and they are reflected even in that small average premium in terms of results.
Back in the days of the free schools and before them, as the hon. Lady mentioned, a 50% cap was put in place, known commonly as the 50% faith cap. That reflected the fact that with free schools there was a different situation, because now any group could come along and say, “We want to open a school.” It seemed a sensible safeguard to have a cap. However, all the way through it has remained legally possible—not a lot of people know this—to open a voluntary aided school. That proposition was tested in law in 2012, after the coalition Government came into office, with the St Richard Reynolds Catholic college in the constituency of the hon. Member for Twickenham. Once a VA school is opened, it can convert to an academy.
Munira Wilson (Twickenham) (LD)
I am listening carefully to the right hon. Gentleman’s excellent speech. Amendment 48 does not seek to prevent faith schools from opening. It would simply apply the cap to any type of school—academy, maintained, voluntary aided or whatever.
For me, the main driver for that safeguard is social cohesion and ethnic diversity. We have talked a lot about Church schools, but there are other faiths that seek to set up schools in certain areas of the country where, without the cap in place, they would not get much racial diversity. That is worrying for community cohesion. I say that as somebody who has a strong personal faith. I send both my children to a Church of England school—mainly because it is in front of my house, so they can leave the house 30 seconds before the gate shuts—but I feel uncomfortable with its level of faith selection. As we heard in oral evidence from Nigel Genders, it is important that state-funded schools be for the whole community and be open to everyone.
Damian Hinds
That is a view. It is a perfectly legitimate view that some people hold, but it is not a view that I hold, nor is it a view that we have held historically in this country. Going back to 1944, to 1870 and even further, we have said that we believe in diversity of provision. That includes the Church of England and the Catholic Church, but it also includes other faiths. Some of the top-performing schools in the country are Jewish schools or Muslim schools.
Munira Wilson
I think the right hon. Gentleman thinks I am arguing that we should abolish faith schools. I have not made that argument. He is saying that this is not how we have done things in this country, but since the coalition and before, we have had a 50% faith cap. All the amendment seeks is clarity in legislation that that 50% faith cap will remain in place for any new school that opens. I realise that it was the Liberal Democrats who forced the Conservatives to put the cap in place for free schools, which is probably why the right hon. Gentleman will oppose me. For me, it is about social cohesion and about honouring the fact that we should serve all our communities. I am not opposing the establishment of new faith schools; I am just saying that they should have a cap of 50% on faith-based admissions.
Damian Hinds
I assure the hon. Lady that on this occasion I am not holding her Liberal Democrat party membership card against her. That is not the basis on which I am making these points.
The hon. Lady said that whatever type of school opens, it should have a 50% cap. By definition, there is no such thing as a VA school with a 50% cap, because being a voluntary aided school means having control over admissions in that way. It is not true that we have necessarily had the 50% cap all the way through; I point to the VA school that opened in her very constituency, and there have been others since then. The reason why only a small handful of VA schools have opened over the past couple of decades is that there was no money for it. To get money to open a school, it had to be a free school.
In 2018-19, the then Secretary of State, fine fellow that he was, created a small capital fund for the voluntary aided schools capital scheme. The reason related to patterns of immigration, particularly Polish and eastern European immigration. In the old days, it was Irish immigration—that is where I come from—but there have been many other waves from different places. As a result of eastern European immigration, there was a demand for Catholic schools in certain parts of the country. Those people, who had come to this country and made their lives here, and of whom there were now generations, were not able to access such schools in the way they could have in other parts of the country. Under that scheme, there were applications from five different faiths; at the time, one was approved and one put on hold. I contend that it is a good system that we have the cap for that tranche of schools—they are not going to be free schools—to retain those safeguards, but it is still possible to open a denominational school, of whichever faith, in circumstances in which there is great need in a particular area.
We talked earlier about local authority areas and their difference in size. Birmingham, which is one massive local authority area, is very different from an individual London borough. For the consideration of faith school applications, it ought to be possible to look over a wider area, because travel-to-school distances are much longer on average.
I want to check with the Minister, the hon. Member for Newcastle upon Tyne North, that the Government’s proposals will not preclude the opening of new voluntary aided schools. I am afraid I must conclude by saying that, for reasons that the hon. Member for Twickenham will understand and that have nothing to do with her party affiliation, I cannot support amendment 48.
Darren Paffey (Southampton Itchen) (Lab)
It is a pleasure to serve under your chairship, Sir Christopher. I rise to support clause 51 and to question the nature of the amendments.
The block on new local authority-run schools could only have been introduced for ideological reasons. Its removal is hugely welcome. If one model were of substantially better quality than the other, there might be a basis for such a block, but the facts speak for themselves: that is not the case. There is now a statistically negligible difference between the number of good and outstanding academies and the number of good and outstanding schools of other models, including local authority schools. It is plain for all to see that they are as good as each other, so the argument no longer holds water that one model is worse than the other and that legislation is therefore needed to block it.
I fully relate to the experience mentioned by the hon. Member for St Neots and Mid Cambridgeshire, where the only option is a free school application that then gets shut down. In my Southampton constituency, we put forward an excellent bid—all the advice throughout the process deemed it excellent—for a free special school. We are all painfully aware of the need for extra places for those with special educational needs and disabilities. With a free school application as our only option, we dutifully engaged, only to have that option shut down to us in the end. That pushes the responsibility back on existing schools to expand, entirely at the cost of already cash-strapped local authorities.
The clause is a sensible restoration of parity of esteem between different school models. On the rationale for objections and scrutiny, I have to say that am left a little confused by the Opposition’s positions and arguments. They question the local authority’s being both the regulator and provider of schools. If they do not support that, what is their solution? Is it for the local authority to become redundant and have no role in planning, so we therefore have centralisation back to the Department for Education? Or is it that we continue to prohibit local authority schools from opening, thereby reducing the mixed economy and maintaining their free school presumption, which got us into this situation in the first place?
I am glad that we have clause 51 in the Bill. It is a strong response to a real need. It takes account of the reality of quality and democratic accountability in school place planning and the opening up of schools. It reflects the fact that we have excellent teachers in local authority maintained schools, every bit as much as in other models of school where they choose to work. It opens up opportunities for multiple bids from school providers. That reflects the position set out in the preceding clauses, which is that we want to get back to a position of collaboration, not unbridled competition, in the provision of education for our children.
The Minister for School Standards (Catherine McKinnell)
I thank the hon. Member for Harborough, Oadby and Wigston for tabling amendment 85. When a local authority thinks that a new school is needed in its area, it will be required to seek proposals for a new school from proposers other than local authorities. That includes academy trusts, as well as other bodies such as charitable foundations and faith bodies. Local authorities will be required to seek proposals for different types of school, including academy schools, foundation schools and voluntary schools.
I appreciate that the hon. Member may be looking for assurance that proposals for new academies will be sought and welcomed as part of the new invitation process. I can absolutely reassure him on that. We are simply ending the presumption that all new schools should be academies and allowing proposals for all types of school, so that the proposal that best meets the needs of children and families in an area is taken forward. All types of schools have an important role to play in driving the high standards that we want to see in every school, so that all children are supported to achieve and thrive.
I thank the hon. Member for Twickenham for tabling amendment 48, which seeks to restrict the proportion of places that can be allocated on the basis of faith to a maximum of 50% for all new schools established following a local authority invitation to establish one. In practice, it would only make a difference to a new voluntary aided foundation and a voluntary controlled school with a faith designation.
I recognise that the hon. Member is seeking to ensure that new schools are inclusive and that all children have access to a good education. That is very much a mission that we share. The Government support the ability of schools designated with a religious character to set faith-based oversubscription criteria. This can support parents who wish to have their children educated in line with their religious beliefs. However, it is for a school’s admission authority to decide whether to adopt such arrangements.
The removal of the legal presumption that all new schools be academies is intended to ensure that local authorities have the flexibility to make the best decision to meet the needs of their communities. Decision makers will carefully consider proposals from all groups and commission the right new schools to meet need and to ensure that every child has the opportunity to achieve and thrive. On that basis, I hope that the hon. Member for Twickenham will not press her amendment.
Clause 51 will end the legal presumption that new schools should be academies. It will require local authorities to invite proposals for academies and other types of school when they think that a new school should be established and will give them the option to put forward their own proposals. The changes will ensure that new schools are opened by the provider with the best offer for local children and families. They will better align local authorities’ responsibilities to secure sufficient school places with their ability to open new schools. We are committed to ensuring that new schools are opened in the right place at the right time, so that all children have access to a core offer of a high-quality education that breaks down the barriers to opportunity.
I turn to hon. Members’ specific questions. There was quite a wide-ranging debate on the amendments, which is typical of this very assiduous Committee. As I said on the faith schools cap provision, we want to allow proposals for different types of school that will promote a diverse school system that supports parental choice. As the right hon. Member for East Hampshire said, we have a rich and diverse school system. Our priority is driving high and rising standards so that children can thrive in whatever type of school they are in. We will work in partnership with all types of school, including faith schools, as part of that mission.
Proposers, including faith groups, will be able to put forward a proposal in response to an invitation from the local authority and where the local authority thinks that a new school should be established in the area. As is already the case, faith groups can put forward proposals for a new voluntary or foundation school outside the invitation process, for example where they think that there is a need for particular places to replace an independent school or to replace one or more foundations or voluntary schools that have a religious character.
Although designated faith schools that are not subject to the 50% cap are not restricted in the number of places that they can offer with reference to faith when oversubscribed, it is for the admission authority to decide whether to adopt such arrangements. Indeed, there is real variation: some choose to prioritise only a certain proportion of their places with reference to faith in order to ensure that places are available for other children, regardless of faith, while many do not use faith-based oversubscription criteria at all. Regardless of the admissions policy set by the admission authority, faith schools remain subject to the same obligations as any other state-funded school to actively promote the fundamental British values of democracy, the rule of law, individual liberty and mutual respect and tolerance of those of different faiths and beliefs, and to teach a broad and balanced curriculum. That will apply to all schools as part of the changes introduced by this Bill.
Let me say in response to concerns about faith schools being less socioeconomically and ethnically diverse that, to be fair, it is not true of all faith schools. Catholic schools are among the most ethnically diverse types of school. Faith schools tend to have intakes that reflect wider intakes; they draw from a much larger catchment area, which can often create a more diverse intake. The Department does not collect data about the admission policies of schools with a religious character, and we do not have any data on the proportion of children admitted to a school on the basis of faith or how many are able to access a preferred place on the basis of their faith. That means that there is no data to support capping faith admissions on the ground that they are restricting children and parents from accessing the school of their choice.
On the role of the adjudicator, which I think the hon. Member for Harborough, Oadby and Wigston asked about specifically, we will set out details in regulations, but it is our intention that local authorities will be able to object to the published admission numbers in another local authority.
I hope that I have responded to all the concerns that have been raised. I commend the clause to the Committee.
Neil O’Brien
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: 48, in clause 51, page 112, line 4, at end insert—
“(5) After section 7A (withdrawal of notices under section 7), insert—
‘7B New schools to allocate no more than half of pupil places on basis of faith
A new school for which proposals are sought by a local authority under section 7 must, where the school is oversubscribed, provide that no more than half of all places are allocated on the basis of or with reference to—
(a) the pupil’s religious faith, or presumed religious faith;
(b) the religious faith, or presumed religious faith, of the pupil’s parents.’”—(Ian Sollom.)
Question put, That the amendment be made.
The Chair
With this it will be convenient to discuss the following:
Clauses 53 and 54 stand part.
Schedule 2 stand part.
Clause 55 stand part.
Catherine McKinnell
Clause 52 requires local authorities to publish proposals when they want to open a new maintained nursery school. It also sets out the circumstances in which local authorities or other proposers can publish proposals for other new schools outside of the invitation process described in clause 51.
Local authorities will be able to publish proposals for a new community, community special, foundation, or foundation special school to replace one or more maintained schools, or to establish a new pupil referral unit to replace one or more pupil referral units. They will not be required to follow the invitation process unless they choose to, or they have already launched an invitation process that they could publish the proposals in response to. It also allows other proposers to propose the establishment of a new foundation, voluntary or foundation special school at any time, unless there is a live invitation process that the proposals could be submitted in response to. Local authorities and other proposers will not need to obtain the Secretary of State’s consent before publishing proposals, as they do now in certain circumstances.
The clause also enables regulations to set out the action that local authorities must take to publicise proposals that have been published under these arrangements.
These provisions give local authorities the flexibility to decide which route to establishing a new school is most appropriate when they are replacing an existing maintained school or schools. They also preserve the ability of other proposers to put forward proposals to the local authority for a new school, for example to meet the need for a particular type of place.
Clause 53 applies a restriction on opening new schools under section 28 of the Education and Inspections Act 2006 to pupil referral units, so that pupil referral units can be established only by following the same statutory procedures, introduced by clauses 51 and 52 of the Bill, that apply to other types of school maintained by local authorities. That means that, where a local authority thinks that a new alternative provision should be established, it will be required to invite proposals from proposers for an alternative provision academy, and will be able to decide whether to publish its own proposals for a pupil referral unit to be considered alongside any academy proposals received.
Clause 53, along with clauses 51 and 52, brings pupil referral units within the statutory arrangements for establishing new schools, providing clarity and transparency about the process by which new pupil referral units can be opened, putting them on an equal footing with alternative provision academies, and better aligning a local authority’s responsibility for securing sufficient places with its ability to open new schools.
Clause 54 introduces schedule 2, which amends schedule 2 to the Education and Inspections Act 2006 to ensure that there are clear and fair processes for the consideration and approval of proposals made under sections 7 or 10 of the 2006 Act, as amended by this Bill, for the establishment of new schools.
Where proposals for a new school have been invited, schedule 2 will ensure that any proposals are considered equally, without the preference being given to academy proposals that there is now. This will allow decision makers to select the best proposal that meets the needs of children and families, regardless of the type of school it is.
In situations where local authorities have chosen to put forward their own proposals alongside others, or there are proposals for a new maintained school to have a foundation that the local authority would have a role in, the Secretary of State will make the decision, to ensure a fair, unbiased outcome.
Schedule 2 also requires the local authority to refer any proposal to the Secretary of State that has not yet been determined, providing an effective backstop in case of concerns over any decision making or delay. Where a local authority put forward proposals outside of an interpretation process, or if there is a proposal outside the process where the authority would be involved in the proposed school’s foundation, they will be required, as now, to refer the proposal to the schools adjudicator for decision.
Schedule 2 makes it clear that, before approving proposals for an academy, a local authority must consult the Secretary of State and seek confirmation that she would, in principle, be willing to enter into a funding agreement for that academy. That mirrors current arrangements and ensures that local authorities can be provided with all relevant information from the Department for Education on an academy trust making a proposal.
Clause 55 puts in place transitional arrangements for moving from the current arrangements for establishing new schools to the new arrangements. Where proposals for a new school have been sought by a local authority or published by a proposer or a local authority under the existing provisions under the Education Inspections Act 2006, and a decision on those proposals has not yet been made by the time the new provisions come into effect, the new arrangements will not apply and the proposals will be determined under the old arrangements. The clause also allows consultation that has been carried out under the requirements of the existing provisions of the 2006 Act, and before the new requirements come into force, to satisfy the requirements to consult under the amended provisions.
The Chair
With this it will be convenient to discuss the following:
Clauses 57 and 58 stand part.
Amendment 11, in clause 59, page 115, line 18, at end insert—
“(2A) Section (Abolition of common law defence of reasonable punishment) comes into force at the end of the period of twelve months beginning with the day on which this Act is passed.”
This amendment is consequential on NC10.
Clauses 59 and 60 stand part.
New clause 10—Abolition of common law defence of reasonable punishment—
(1) The Children Act 2004 is amended as follows.
(2) In section 58 (Reasonable Punishment: England), omit subsections (1) to (4).
(3) After section 58, insert—
“58A Abolition of common law defence of reasonable punishment
(1) The common law defence of reasonable punishment is abolished in relation to corporal punishment of a child taking place in England.
(2) Corporal punishment of a child taking place in England cannot be justified in any civil or criminal proceedings on the ground that it constituted reasonable punishment.
(3) Corporal punishment of a child taking place in England cannot be justified in any civil or criminal proceedings on the ground that it constituted acceptable conduct for the purposes of any other rule of the common law.
(4) For the purposes of subsections (1) to (3) “corporal punishment” means any battery carried out as a punishment.
(5) The Secretary of State may make regulations for transitory, transitional or saving provision in connection with the coming into force of this section.
(6) The power to make regulations under subsection (5) is exercisable by statutory instrument.
58B Promotion of public awareness and reporting
(1) The Secretary of State must take steps before the coming into force of section 58A to promote public awareness of the changes to the law to be made by that section.
(2) The Secretary of State must, five years after its commencement, prepare a report on the effect of the changes to the law made by section 58A.
(3) The Secretary of State must, as soon as practicable after preparing a report under this section—
(a) lay the report before Parliament, and
(b) publish the report.
(4) The Secretary of State may make regulations for transitory, transitional or saving provision in connection with the coming into force of this section.
(5) The power to make regulations under subsection (4) is exercisable by statutory instrument.”
This new clause would abolish the common law defence of reasonable punishment in relation to corporal (physical) punishment of a child taking place in England, amend certain provisions of the Children Act 2004 relating to corporal punishment of children and place a duty on the Secretary of State to report this change.
Catherine McKinnell
Clause 56 contains a provision for the Secretary of State to make changes consequential on the provisions of the Bill to other legislation, as well as to existing primary legislation. It has been drafted to allow the Secretary of State to make consequential changes to other Acts preceding this Bill or those that are passing before Parliament in this Session. It is always possible that necessary changes to legislation may be identified after a Bill’s passage. Given the breadth of legal areas that the Bill covers, it is prudent to provide a failsafe should anything have been missed. Without one, there is a risk to the coherence of the legislative landscape that the Bill creates. The clause sets out that regulations making changes to primary regulation are subject to the affirmative procedure, and that those making changes to other legislation are subject to the negative procedure.
Clause 57 contains a financial provision necessary to the provisions of the Bill that require expenditure. It sets out the expectation that Parliament will fund any expenditure and any future increase in it incurred by the Secretary of State in relation to this Bill.
Clause 58 sets out the territorial extent of the provisions in the Bill. It is a standard clause for all legislation. As the Committee is aware, Westminster does not normally legislate on devolved matters without the consent of the relevant devolved Governments. However, there are no provisions of this Bill that engage that process.
Clause 59 sets out when the provisions in the Bill come into force. The general provisions on extent, commencement and the short title come into force on the day of Royal Assent. Subsection (2) sets out the provisions that will come into force two months after the Bill is passed. All the provisions will come into force on a day or days to be appointed by the Secretary of State through regulations. Those regulations may appoint different days for different purposes or different areas. The Secretary of State may also make regulations that provide for transitional or saving provision in connection with commencement.
Clause 60 provides that the short title of the Bill will be Children’s Wellbeing and Schools Act 2025. For the reasons outlined, I commend the clauses to the Committee.
On new clause 10, I am grateful for the opportunity to discuss removing the common law defence of reasonable punishment. Keeping children safe could not be more important to the Government. We are already taking swift action through these landmark reforms to children’s social care. It is the biggest overhaul in a generation. The Government are committed, through our plan for change, to ensuring that children growing up in our country get the best start in life through wider investment in family hubs and parenting support. This landmark Bill puts protecting children at its heart.
To be absolutely clear, the Government do not condone violence or the abuse of children, and there are laws in place to protect children against those things. Child protection agencies and the police treat allegations of abuse very seriously. They will investigate and take appropriate action, including prosecution, where there is sufficient evidence of an offence having been committed. Local authorities, police and healthcare professionals have a clear duty to act immediately to protect children if they are concerned that a child is suffering, or is likely to suffer, significant harm.
This Bill will put children’s future at the centre of rebuilding public services, requiring higher standards for all children in need of help and protection. It is a key step towards delivering the Government’s opportunity mission to break the link between a young person’s background and future success.
We do not intend to legislate on the defence at this stage, but we will review the position when we have evidence from Wales of the impact since it was removed. Wales will publish its findings by the end of 2025 and we will look at them carefully. We recognise that parents have different views and approaches to disciplining their children. We need to consider their voices, and those of the child, trusted stakeholders and people who might be disproportionately affected by the removal of the defence, in making any decisions.
Let us also be clear: those children who have been abused or murdered by their parents would not have been covered by the defence of reasonable punishment. Crown Prosecution Service guidance is very clear about what is acceptable within the law to justify reasonable punishment.
The Bill introduces many measures to keep children safe—for example, requiring local authorities to have and maintain children not in school registers; improving information sharing between agencies; making sure that education and childcare settings are involved in local safeguarding partnerships; and making it a requirement for every local authority to have multi-agency child protection teams. Nationally, we are rolling out the vital multi-agency family health and child protection reforms through the Families First partnership programme from April 2025, and we are delivering parenting support through our family hubs programme in several local authorities.
The protection of children is critical. The Bill takes important steps to improve safeguarding. On that basis, I invite the hon. Member for North Herefordshire not to press the new clause.
On amendment 11, I appreciate what the hon. Member has set out in relation to having a delayed implementation for the removal of the defence of reasonable punishment. As I mentioned in response to new clause 10, we do not intend to legislate at this stage, but we will wait for Wales to publish its impact report on removing the defence, which is due at the end of 2025. We will look at the evidence of the potential impact before making such a significant legislative change. When we review the position, we will ensure that due thought and consideration are given to ensuring that there is an appropriate implementation period. On that basis, I invite her not to press the amendment.
Neil O’Brien
I rise to speak only to clause 56, which is a big old Henry VIII power. I am sure that their lordships will want to explore it in detail. In the interests of time, I have not tabled an amendment to it at this stage and I will not go into lots of detail, but it is always important to note such things. It is no small thing to give the Government the power to amend primary legislation without coming back to the House. Of course, there are certain limits to what they could do by means of such measures, but it is a big deal.
I place it on the record that the Minister will be well aware of some of the concerns about the clause that are coming to us from civil society. I am sure that she will have seen the comments from Jen Persson, the director of Defend Digital Me, on the information powers in the Bill. When we make laws in this way, it relies on someone noticing and raising an objection to Parliament to get any kind of democratic debate, and we can only stop such things in hindsight.
As the Minister will know, Defend Digital Me has put forward 30 different areas and proposals that it has concerns about, particularly on the information side. On previous clauses, we debated the constant unique identifier and eventually using the NHS number for that, and other things that we have objected to, such as the requirement to give information about how much time a home-schooled child is spending with both parents.
I will not reconsider all the debates that we have already had, but all those important decisions will potentially be in the scope of this Henry VIII power. I am keen to move on to the new clauses, so I will not go any further now, but I am sure that the Government will receive lots of probing questions on this point as the Bill moves to the other place.
Munira Wilson
I rise to speak in support of new clause 10, adding the Liberal Democrats’ support for putting equal protection into law for children. I do not understand why we would have a different level of protection for adults versus children. They are the most vulnerable children in our society. The Children’s Commissioner and the National Society for the Prevention of Cruelty to Children have been very clear that children should be protected. This is not seeking to interfere with parents in terms of how they discipline their children; it is about protecting our most vulnerable. The Children’s Commissioner has strongly called for this, particularly in the wake of the tragic case of Sara Sharif.
I really hope, when the Minister says that the Government will actively look at this during this Parliament, that that is the case. I suspect that there are Members in all parts of the House—I note that the new clause has cross-party support—who will continue to press her on this matter, because it is a basic issue of children’s rights and equal protection in law.
Ellie Chowns (North Herefordshire) (Green)
It is a pleasure to serve under your chairmanship, Sir Christopher. I rise to speak to demonstrate the cross-party support that has already been referred to for new clause 10 and consequential amendment 11 in the name of the hon. Member for Lowestoft (Jess Asato), and I would like to start by congratulating and thanking her for her important work on this issue over many years.
Giving children equal protection from assault cannot happen soon enough. Although we tabled amendment 11 as a probing amendment, I cannot urge the Government strongly enough to grasp this opportunity, in this Bill on children’s wellbeing, to take this forward and put it into law.
Taking the essential step of giving children equal protection from assault has very widespread support not only among the general public, but among all sorts of organisations that advocate and work on behalf of children, including the NSPCC, the Royal College of Paediatrics and Child Health, the Parenting and Family Research Alliance and the Children’s Commissioner, to name just a few. We heard from the Children’s Commissioner herself in oral and written evidence just how strongly she feels about this matter. I share her view that it is totally unacceptable that in 2025, children have less protection from assault under English law than adults do. The existence of the “reasonable punishment” defence perpetuates ambiguity in the law. It leaves children exposed to potential harm and undermines efforts to safeguard their wellbeing. New clause 10 would remove this outdated defence and provide clarity, consistency, and equal protection for children under the law.
The Minister talked about wanting to wait until we have evidence from Wales, and of course, as she acknowledges, it is only in England and Northern Ireland that children do not have this protection. Scotland and Wales have already passed legislation on this matter—indeed, Scotland did before Wales, in 2020. The Minister mentioned waiting for evidence to come from Wales as to the impact of this. There is very clear evidence—worldwide, in fact—on the benefits of giving children the same protection from violence as adults. I believe there are 65 countries worldwide that give that protection, and there are decades of evidence on that topic. I am sure she has received that evidence and I warmly invite her to peruse it very carefully.
Many studies show that physical punishment is not only ineffective at managing children’s behaviour, which is what some parents may intend, but actively harmful. It is associated with increased behavioural problems, increased risks of mental health issues and increased risks of more serious assault. The current, grimly outdated legal framework complicates the matter of addressing improving safeguarding efforts and makes it harder for professionals to assess and effectively address risks to children. The Minister referenced the roles of professionals in safeguarding children, and there is significant testimony from those professionals about how unhelpful this ambiguity in the law is. Fundamentally, there is an inequality here. If an adult hits an adult, it is assault; if an adult hits a child, they can claim the defence of reasonable punishment.
Catherine McKinnell
I will respond initially to the question raised by the hon. Member for—
Catherine McKinnell
On clause 56, it is always possible that necessary changes to legislation might be identified through a Bill’s passage. As I said, it is therefore prudent to have a failsafe should anything have been missed. This power is limited and narrow: it can be used only to make amendments that are consequential on the Bill’s provisions, which will be voted on, and it is in line with usual practice.
Regulations made under the power that amend or repeal any provision in primary legislation will be subject to parliamentary scrutiny. We have carefully considered the power, and we believe that it is entirely justified in this case. It is needed to ensure that we are able to deal with the legislative consequences that may flow naturally from the main provisions and ensure that other legislation continues to work properly following the passage of the Bill.
Damian Hinds
I have never been so warmly welcomed. [Laughter.] We talked a few sittings ago about the NHS number and the database of children, and there are a lot of wide-open questions about the scope of that. Is that all children? How will it be used? In turn, that could potentially affect a lot of other pieces of legislation.
Bearing in mind the massive controversies we have had in this country in the past over ID cards, privacy and so on, will the Minister write to the Committee setting out specifically what some of the issues in relation to that might be? We do not want find ourselves having agreed to do something that we did not realise we were agreeing to do.
Catherine McKinnell
I think I can assure the right hon. Gentleman that that is not the case. The inclusion of similar powers is common and well-precedented in legislation. Powers to make consequential amendments can be found in several other Government Bills, such as the Renters’ Rights Bill and the Employment Rights Bill, as well as in Acts presented under the previous Administration, such as the Health and Care Act 2022, which I am sure the right hon. Gentleman is fully supportive of.
I turn to new clause 10 and the contributions from hon. Members. I absolutely appreciate the case that is being made, which is why we are open-minded on the issue, but we do not intend to bring forward legislation imminently. The hon. Member for North Herefordshire spoke about the successful implementation in Wales. I am interested in how she knows that to be the case, because we are awaiting the publication of the impact assessment. We are very keen that legislation is evidence-based and has its intended effect. That is why we are waiting for the evidence that will come from Wales.
The hon. Member mentioned a number of international examples. I have an example from New Zealand, which removed the reasonable punishment defence in 2007. Data suggests that 13 cases were investigated between 2007 and 2009, with one prosecution. It is important that we look at how this measure works within the context of each country that it is applying it. Obviously, we will look very closely at the implementation in Wales—the impact it has and the difference it makes—and will also then look at how that will apply specifically within an England context before proceeding with legislation.
Ellie Chowns
There are two points that I would want to make. Is the Minister really arguing that whether we should protect children from violence depends on whether an impact assessment shows that there are a certain number of prosecutions or whatever? Is this not about the fundamental equality of protecting children in the same way that we give adults legal protection against assault?
Secondly, the impact of giving that equal protection is surely not something that should be measured in the sense of how many prosecutions there have been over how many years. This is not about getting more prosecutions; it is about shifting the culture as a whole to recognise that there is no justification for violence against children—none.
Catherine McKinnell
Keeping children safe could not be more important, and it could not be a greater priority for this Government. The question is how that is best achieved. That is the evidence that we are awaiting from Wales—to see how impactful the change made there has been.
I will give another example, from the Republic of Ireland, which removed the reasonable punishment defence in 2015. There is limited data on the impact, but a poll in 2020 suggested that a relatively high acceptance of slapping children remained.
Absolute clarity and an evidence-based approach is what the Government seek to take. That is why, within this legislation, we have absolutely prioritised real, tangible measures, which we can put into practice without delay, to significantly improve the chances of any harm coming to children being minimised. I listed those measures in my opening response on this clause. As the law stands, quite frankly, any suggestion that reasonable punishment could be used as a defence to serious harm to a child, or indeed death, as has been asserted, is completely wrong and frankly absurd.
Ellie Chowns
The Minister cited an example from Ireland. I do not think anybody is arguing that abolition of the defence of reasonable punishment will, in and of itself, stop all violence against children, but we are arguing that it is an important component of what must be done to stop violence against children. The Children’s Commissioner and all the other people I have cited have made very powerful arguments to that effect. Professionals working in the sector have talked about how the ambiguity of the current law is actively unhelpful to them in offering support and intervention to families in which this might be an issue.
Going back to the point about needing to wait for an impact assessment, does the Minister think there is any universe in which it could be more beneficial for children to keep the defence of reasonable punishment than it would be to abolish it? Surely it is logical to expect that ensuring equal protection for children will move things in a better direction, alongside all the family support required to make a sustainable long-term change.
Catherine McKinnell
As I have said, we need to wait and look at the evidence before making such a significant legislative change. The protection of children is critical. The Bill takes significant steps to improve safeguarding. The context in England is different from Scotland and Wales. Therefore, the changes would need to be considered very carefully in the light of the evidence and how they would tangibly impact the protection of children in England. We are awaiting the impact assessment and will take action accordingly.
Abusive parents are caught under the existing legislative framework. The challenge in this area is that parenting is complex. I can attest that it is one of the most difficult jobs anyone can do. Parents know their children, and they want to get it right with their children. As the hon. Member for North Herefordshire acknowledges, parenting programmes and support is what we are focused on. We are putting in place support for parents to be good parents, because that is what the vast majority want to be. When that is not their intent, there are laws in place to prevent harm from coming to children. I absolutely accept the arguments being put forward today. We have an open mind and will look at the evidence and take a very careful approach to this. I commend the clause to the Committee.
Question put and agreed to.
Clause 56 accordingly ordered to stand part of the Bill.
Clauses 57 and 58 ordered to stand part of the Bill.
Clause 59
Commencement
The Chair
It is on the amendment paper—it is there for all to see. We debated it in a previous group, and I presume the Government now want to support it. If everybody is happy, I will call the Minister to move amendment 93 formally.
Amendment made: 93, in clause 59, page 115, line 17, leave out paragraph (h) and insert—
“(h) section (Pay and conditions of Academy teachers) and Schedule (Pay and conditions of Academy teachers: amendments to the Education Act 2002) other than paragraph 6 of that Schedule;
(ha) section 46;”—(Catherine McKinnell.)
This amendment is consequential on Amendment 92 and NC57.
Clause 59, as amended, ordered to stand part of the Bill.
Clause 60 ordered to stand part of the Bill.
New Clause 6
Care leavers not to be regarded as becoming homeless intentionally
“(1) In section 191 of the Housing Act 1996 (becoming homeless intentionally)—
after subsection (1) insert—
‘(1ZA) But a person does not become homeless intentionally in a case described in any of subsections (1A) to (1C).’;
in subsection (1A), for the words before paragraph (a) substitute
‘The first case is where—’;
after subsection (1A) insert—
‘(1B) The second case is where the person is a relevant child within the meaning given by section 23A(2) of the Children Act 1989.
(1C) The third case is where the person is a former relevant child within the meaning given by section 23C(1) of that Act and aged under 25.’;
in subsection (3), in the words before paragraph (a), after ‘person’ insert
‘, other than a person described in subsection (1B) or (1C),’.
(2) The amendments made by this section do not apply in relation to an application of a kind mentioned in section 183(1) of the Housing Act 1996 made before the date on which this section comes into force, except where the local housing authority deciding the application has not yet decided the matters set out in section 184(1)(a) and (b) of that Act.”—(Catherine McKinnell.)
The Housing Act 1996 requires local housing authorities to assist persons with securing accommodation in certain circumstances and limits the requirement in relation to persons who have become homeless intentionally. This amendment would prevent the limitation applying in relation to certain young persons formerly looked after by local authorities.
Brought up, and read the First time.
Catherine McKinnell
I beg to move, That the clause be read a Second time.
As I am sure colleagues will be all too aware, homelessness levels are far too high. Homelessness can have a devastating impact on those affected. The Government are determined to address that and deliver long-term solutions to get us back on track to ending homelessness. Care leavers are particularly vulnerable to becoming homeless, with the number of care leavers aged 18 to 20 becoming homeless rising by a shocking 54% in the past five years. Young care leavers are also more likely to be found to have become intentionally homeless by local authorities, meaning that local authorities are not required to secure them settled accommodation.
This Government take corporate parenting seriously, and recognise the key role that local authorities play in providing care, stability and support to care leavers—like any parent would. We are introducing the new clause to ensure that, where a council is their corporate parent, no care leaver can be found to have become intentionally homeless. This is an essential step to ensure that those care leavers are not held back by their start in life and get the support they need to build a secure and successful future. I therefore recommend that the new clause be added to the Bill.
Catherine Atkinson (Derby North) (Lab)
Become, the charity for children in care and young care leavers, strongly welcomes the new clause, as does the YMCA, which supports around 1,000 care leavers a year with housing.
In its written evidence to the Committee, Become pointed to a freedom of information request that it submitted to all tier 1 local authorities in England last year, which showed real variation in whether they disapplied homelessness intentionality assessments for care leavers. Become provided examples of hearing from care-experienced young people who have been assessed as intentionally homeless for moving away to university, not keeping in touch with their personal advisers or turning down offers of accommodation that was not appropriate for them. That contradicts local authorities’ duties as corporate parents, and contributes to the disproportionate risk of homelessness that care-experienced young people are subject to.
I thank Become for its evidence, which provides powerful insight and an argument in support of the new clause. I hugely welcome it being added to the Bill.
Damian Hinds
Will the Minister confirm that the new clause will also apply to the small group of young people who are leaving the young justice system and returning to their home area?
Darren Paffey
Briefly, I warmly welcome the new clause. Colleagues will be aware of my interest in this area. From years of working alongside those who fall foul of laws and principles on paper that they never see, but that make a material difference to their lives and outcomes, I know that this will be a positive change. It builds on years of work, including not only the work of various charities already mentioned by my hon. Friend the Member for Derby North, but the work of my hon. Friend the Member for Whitehaven and Workington (Josh MacAlister) and no doubt countless others, and will be warmly welcomed. I am excited to be able to report to those in my constituency on the work of this Government in making sure that care leavers have better outcomes. I look forward to working with Ministers in the future to work out how we can get from this point to other areas that will make a positive material difference to their lives.
Catherine McKinnell
I thank hon. Members for their contributions, and absolutely agree on the importance of this measure and the difference it will make to children and young people as they move into the sometimes challenging transition to adulthood, having experienced care and on leaving care.
In response to the question from the right hon. Member for East Hampshire, the amendment will impact children classed under the Children Act 1989 as relevant children or former relevant children who present for homelessness assistance. That would cover young people aged 16 to 24 who have been looked after by a local authority for a period of at least 13 weeks, or periods that amount to 13 weeks, since their 14th birthday, at least one day of which must have been since they attained the age of 18.
The answer to the right hon. Gentleman’s question would, therefore, be subject to those parameters, but I imagine that in most cases it would apply to young people leaving the criminal justice system. He is right to raise that as a concern. Indeed, the purpose of the measure is to disapply the intentional homelessness test for care leavers who are within that scope. Care leavers who have left the youth justice system would quite rightly be included, given that they will experience similar challenges to other care leavers in establishing themselves in a secure adult life.
Tom Hayes (Bournemouth East) (Lab)
I was struck by recent data that shows that care leavers are particularly vulnerable to homelessness, as we have heard in this Bill Committee. Latest Government data show that the numbers of care leavers aged between 18 and 20 becoming homeless have increased by 54% over the past two years. Can the Minister outline how this very welcome measure will enhance and strengthen joint working between the children’s and housing departments, and outline a bit more some of the impacts of homelessness on care-experienced people and care leavers?
Catherine McKinnell
My hon. Friend makes an important point. It is worth looking at the data: in 2023-24 there were up to 410 households that included a care leaver who was found to be intentionally homeless. We appreciate that disapplying the intentional homelessness test means that local authorities will have much greater scope and ability to work with these young people and to support them into a more secure adult life. That clearly involves having a secure home, so I hope that hon. Members are willing to support this clause.
Question put and agreed to.
New clause 6 accordingly read a Second time, and added to the Bill.
New Clause 57
Pay and conditions of Academy teachers
“Schedule (Pay and conditions of Academy teachers: amendments to the Education Act 2002) amends Part 8 of the Education Act 2002 (teachers’ pay and conditions etc) in relation to the pay and conditions of teachers at Academies (other than 16 to 19 Academies).
Part 8 of the Education Act 2002”.—(Vicky Foxcroft.)
This clause replaces Clause 45 and introduces the schedule to be inserted by NS1.
Brought up, read the First and Second time, and added to the Bill.
New Clause 1
Implementation of the recommendations of the Independent Inquiry into Child Sexual Abuse
“(1) The Secretary of State must, within 6 months of the passing of this Act, take steps to implement each of the recommendations made in the final report of the Independent Inquiry into Child Sexual Abuse.
(2) The Secretary of State must, after a period of six months has elapsed from the passing of this Act and at 12 monthly intervals thereafter, publish a report detailing the steps taken by the Government to implement each of the recommendations.
(3) A report published under subsection (2) must include—
(a) actions taken to meet, action or implement each of the recommendations made in the final report of the Independent Inquiry into Child Sexual Abuse;
(b) details of any further action required to implement each of the recommendations or planned to supplement the recommendations;
(c) consideration of any challenges to full or successful implementation of the recommendations, with proposals for addressing these challenges so as to facilitate implementation of the recommendations; and
(d) where it has not been practicable to fully implement a recommendation—
(i) explanation of why implementation has not been possible;
(ii) a statement of the Government’s intention to implement the recommendation; and
(iii) a timetable for implementation.
(4) A report published under subsection (2) must be subject to debate in both Houses of Parliament within one month of its publication.
(5) In meeting its obligations under subsections (1) and (2), the Secretary of State may consult with such individuals or organisations as they deem appropriate.”—(Munira Wilson.)
Brought up, and read the First time.
Munira Wilson
I beg to move, That the clause be read a Second time.
I rise to speak to the new clause, tabled in my name and in the name of a number of my colleagues. Briefly, it goes without saying that, on all sides of the House, we are horrified by child sex abuse and what Professor Alexis Jay uncovered through her seven-year-long investigation. We are also horrified that so little progress has been made to date in implementing the 20 recommendations she set out. The new clause therefore seeks to create a legislative commitment, with clear timescales and regular reporting to Parliament, on progress in implementing that report. It is an attempt to approach the issue constructively.
I was disappointed, to put it mildly—in fact, pretty outraged—that Conservative colleagues sought to weaponise the issue on Second Reading to try to kill off the entire Bill. I hope that this is a much more constructive approach. However, I recognise that shortly after my tabling the new clause following Second Reading, the Government made further announcements, including that Baroness Casey will undertake a rapid review and that they will be setting out a timetable.
On that basis, I am happy to withdraw the new clause, but my party and I will continue to hold the Government’s feet to the fire. These girls have been abused, and I am in no doubt that the abuse is ongoing. That needs to be tackled, and justice needs to be served, so I hope that the Government will implement the recommendations and set out a clear timescale.
Ellie Chowns
I rise to speak in support of the new clause, while recognising what the hon. Lady who tabled it has just said. In doing so, I am particularly mindful of a constituent of mine who came to see me in January to tell me that she had given evidence to the independent inquiry into child sexual abuse. Frustrated does not even cover how she felt—she was incredibly upset at the lack of progress on implementation under the previous Government, and she was frustrated to find that progress now is still not fast enough.
We have a huge responsibility to all who suffer child sexual abuse, and in particular to those who have been brave enough to come forward and give evidence, trusting that that evidence would help to make changes. I hope that the Minister can clarify timetables for implementation.
Catherine McKinnell
As the Prime Minister has made clear, we are absolutely focused on delivering justice and change for the victims on this horrific crime. On 6 January, the Home Secretary outlined in Parliament commitments to introduce a mandatory duty for those engaging with children to report sexual abuse and exploitation, to toughen up sentencing by making grooming an aggravating factor and to introduce a new performance framework for policing.
On 16 January, the Home Secretary made a further statement to the House that, before Easter, the Government will lay out a clear timetable for taking forward the 20 recommendations from the final IICSA report. Four of those were for the Home Office, including on disclosure and barring, and work on those is already under way. As the Home Secretary stated, a cross-Government ministerial group is considering and working through the remaining recommendations. That group will be supported by a new victims and survivors panel.
The Government will also implement all the remaining recommendations in IICSA’s separate, stand-alone report on grooming gangs, from February 2022. As part of that, we will update Department for Education guidance. Other measures that the Government are taking forward include the appointment of Baroness Louise Casey to lead a rapid audit of existing evidence on grooming gangs, which will support a better understanding of the current scale and nature of gang-based exploitation across the country, and to make recommendations on the further work that is needed.
The Government will extend the remit of the independent child sexual abuse review panel, so that it covers not just historical cases before 2013, but all cases since, so that any victim of abuse will have the right to seek an independent review without having to go back to the local institutions that decided not to proceed with their case. We will also provide stronger national backing for local inquiries, by supplying £5 million of funding to help local authorities set up their own reviews. Working in partnership with Tom Crowther KC, the Home Office will develop a new effective framework for victim-centred, locally led inquiries.
This landmark Bill will put in place a package of support to drive high and rising standards throughout our education and care systems, so that every child can achieve and thrive. It will protect children at risk of abuse and stop vulnerable children falling through the cracks in service. I acknowledge that the hon. Member for Twickenham is content to withdraw her new clause, and thank her for that. Allowing this Bill’s passage will indeed go a long way to supporting the young people growing up in our system and to protect them from falling through the cracks that may leave them vulnerable to this form of abuse. Indeed, across Government, we will continue to work to take forward the recommendations and to reform our system so that victims get the justice they deserve.
Munira Wilson
I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 2
Provision of free school lunches to all primary school children
“(1) Section 512ZB of the Education Act 1996 (provision of free school lunches and milk) is amended as follows.
(2) In paragraph (4A)(b), after ‘year 2,’ insert ‘year 3, year 4, year 5, year 6’.
(3) In subsection (4C), after ‘age of 7;’ insert—
‘“Year 3” means a year group in which the majority of children will, in the school year, attain the age of 8;
“Year 4” means a year group in which the majority of children will, in the school year, attain the age of 9;
“Year 5” means a year group in which the majority of children will, in the school year, attain the age of 10;
“Year 6” means a year group in which the majority of children will, in the school year, attain the age of 11;’” —(Ellie Chowns.)
This new clause would extend free school lunches to all primary school age children in state funded schools.
Brought up, and read the First time.
Ellie Chowns
I beg to move, That the clause be read a Second time.
New clause 2 would extend the provision of free school lunches to all primary school children, from year 2 up to year 6. It was tabled in the in the name of the hon. Member for Stroud (Dr Opher)—I thank him for his work on this—and has been supported by 43 hon. Members across the House. In addition to this high level of support from MPs, the No Child Left Behind campaign, which underpins new clause 2, is backed by more than 250 civil society leaders, from unions to charities, from medical bodies to faith leaders, and from mayors to councils. This widespread backing is unsurprising, because the case for universal free school meals is, in fact, overwhelming.
Let us start with the need, which is acute. I am sure colleagues remember how during the pandemic Marcus Rashford ignited the campaign for free school meals, pointing out that we could fill 27 Wembley stadiums with the 2.5 million children who were struggling to know where their next meal was coming from—a shocking indictment.
That shameful legacy of child poverty from the last Government continues, with hunger in schools still endemic. University of Bristol research shows that one in five schools runs a food bank. That figure, I am told, is higher than the total number of community food banks being operated outside schools by organisations such as the Trussell Trust and the Independent Food Aid Network.
The National Education Union explained that its members see the struggles of children in poverty every day. Some 80% of teachers asked said that they had provided food for hungry children out of their own pockets—is that not extraordinary? One of those teachers said:
“So many of our children arrive tired and hungry. I find the issue with food so awful. I stock my school kitchen every week with fruit, cereal, milk, biscuits...the number of children who pop in to see me and then ask for food has grown over the last two years. It is heart-breaking.”
It truly is.
New clause 2 is therefore a probing amendment to make the case for a universal approach as the best policy response for three key reasons. First, it is immediately good for children. Secondly, it is an effective long-term investment. Thirdly, it is basically just efficient. I will briefly explore those arguments.
Universal provision is good for children; it immediately helps children to learn, grow and thrive in school. For example, we have recently had the roll-out of free school meal provision to all children attending primary state schools in London. Initial research evaluating that roll-out, which was published a couple of months ago, found that the policy helped with children’s readiness to learn and ability to concentrate. It helps children to do what they are supposed to be doing in schools—learning.
The Department for Education evaluation of the pilot undertaken by the last Labour Government found that pupils in schools where all children received free school meals made four to eight weeks’ more progress in maths and English over two years. That is an extraordinary improvement in progress. In that pilot, the poorest children were those who made the most progress, reducing the attainment gap. In areas with means-tested provision, the effect on attainment was negligible, so we have strong evidence for the benefits of universality.
On the health benefits—this is really shocking—research by The BMJ found that less than 2% of packed lunches met the school food standards. That represents an extraordinary nutritional shortfall in what many children are eating. A policy of universal free school meals would be a major opportunity to increase healthy eating. Ensuring that every child in a school has access to the same food also helps to reduce the stigma and shame that comes from singling out pupils through means-tested provision, and gives pupils a better sense of belonging in school.
Those are the immediate benefits of universal provision, but there are also really strong long-term investment benefits from it. The evidence shows that these universal systems reduce inequality and deliver wider economic prosperity beyond the classroom. PwC—that well-known radical institution—produced an analysis showing that, for every £1 invested in universal free school meals, £1.71 is generated in core benefits, such as increased savings for the NHS and for schools, and increased lifetime earnings and tax contributions. Other expert research also shows that the provision of universal free school meals increases pupils’ lifetime earnings, with the biggest increase again for the most disadvantaged children, thereby reducing inequalities for a generation after school. It is such a powerful policy for reducing inequalities.
I have banged on in other Commons debates about the value of public procurement for investing in our wider UK food and farming sector. When food is sustainably sourced, there is a huge potential benefit; work from Food for Life demonstrates that every £1 spent creates £3 in social, economic and environmental value, mostly in the form of jobs in the local economy.
The third key argument for universal free school meal provision is simply that it is more efficient. We know that providing free school meals helps to end a situation where children fall through the gaps. Means-testing is always going to miss some children and families and, in England, the genuinely draconian eligibility criteria for free school meals means that one in three children living in poverty are still considered too well-off to access free school meals. That is extraordinary. Restricted eligibility, complicated registration processes and stigma also block countless families from accessing support. A universal provision would end this situation where far too many children fall through the gaps.
Free school meals, by the way, would also be massively more efficient in reducing administration. Schools would be able to get back administration time with all children’s meals being provided in the same way at the same time, as one mechanism, and we would get rid of problems around school lunch debts. These universal policies are also easier to defend and protect from erosion by future Governments, who might seek to freeze thresholds or restrict eligibility. In the UK, Wales and London are leading the way in the provision of free, universal, healthy meals at lunch time for every child in primary school as a means of reducing inequalities. England needs to catch up.
I sincerely hope that the Minister will consider new clause 2 ahead of Report to build on the excellent progress on breakfast clubs included in the Bill. Would it not be even more efficient and beneficial—nutritionally and economically, and for all the other reasons I have outlined—to ensure universal free school meal provision when children are already in school? It certainly would be at primary level, which is the case made by this amendment.
I and my party support a policy of extension of universal free school meals to all children, because hunger does not stop at age 11. This amendment focuses particularly on primary school-age children. We know children cannot learn effectively when they are hungry and school dinners help children to focus. They bring the community together and help children to connect with their peers and to build bright futures. Our children learn and play together—they should eat together, too.
Munira Wilson
Briefly, I very much support the ambition in this new clause. After all, it was the Liberal Democrats, in Government, who introduced universal infant free school meals; we have always had the long-term ambition of extending that to all primary school children. However, I recognise the cash-constrained environment that the Government are operating in. That is why, when we get to it, I will be speaking to new clause 31, which looks at increasing the eligibility for children to receive free school meals. However, I want to put on the record that we do support the intent of this provision in the long term, for all the reasons the hon. Lady has just laid out.
The Parliamentary Under-Secretary of State for Education (Stephen Morgan)
It is a pleasure to serve under your chairmanship, Sir Christopher. I turn to new clause 2, tabled by my hon. Friend the Member for Stroud (Dr Opher), on the important topic of expanding eligibility for free school meals, specifically universal provision, which the hon. Member for North Herefordshire has moved today.
Under the current programmes, all pupils in reception, year 1 and year 2 in England’s state-funded schools are entitled to universal infant free school meals. That benefits around 1.3 million children, ensuring that they receive a nutritious lunch-time meal. In addition, 2.1 million disadvantaged pupils—24.6% of all pupils in state-funded schools—are eligible to receive benefits-based free school meals. Another 90,000 16 to 18-year-old students in further education are entitled to receive free school meals on the basis of low income. Those meals provide much-needed nutrition for pupils and can boost school attendance, improve behaviour and set children up for success by ensuring that they can concentrate and learn in the classroom and get the most out of their education.
In total, we spend over £1.5 billion on delivering free school meal programmes. Eligibility for benefits-based free school meals drives the allocation of billions of additional pounds of disadvantage funding. The free school meal support that the Government provide is more important than ever, because we have inherited a trend of rising child poverty and widening attainment gaps between children eligible for free school meals and their peers.
Lizzi Collinge
Does my hon. Friend agree that the value of school meals is much more than the nutrition that they give, and even more than children’s educational achievement when they are properly fed? It is also about building a set of behaviours, a sense of community and an ability to interact with others. It is absolutely vital that when children sit down for a school meal or a packed lunch, that is part of their social development.
Stephen Morgan
I know my hon. Friend is a real champion of children and young people in her constituency, and she is absolutely right. When I visit schools across the country, I see the benefits of school meals. Not only do children sit and eat together, but they learn how to use a knife and fork. She is absolutely right to point out the wider benefits that the free school meal programme brings.
The number of children in poverty has increased by over 700,000 since 2010, with more than 4 million now growing up in low-income families. We are committed to delivering on our ambitious strategy to reduce child poverty by tackling its root causes and giving every child the best start in life.
Tom Hayes
So eager am I to find out which schools in my area are the early adopters that I am currently on a little coach trip around all of them. I have visited four in the last seven days, and I have spoken to people about their experiences and aspirations under this Labour Government. It is brilliant to speak to teachers who now feel that there is light at the end of the tunnel—teachers who have held on for so long in recent years, hoping things will get better. With a change of Government, they now have a change of education policy, and the provision of free breakfast clubs is a true indicator of that.
Teachers say that they want to go further and faster with the provision of breakfast clubs, but they also realise that they need to take time to get it right. Although I obviously welcome the intent of my hon. Friend the Member for Stroud, I believe that moving forward with free breakfast clubs and free school lunches could put too great a strain on schools at this point, because I recognise that the roll-out of free breakfast clubs is restricted to early adopters in the first phase.
Stephen Morgan
I know my hon. Friend is a real champion of children and young people in his constituency, and of the Government’s ambitions on breakfast clubs. I hope that he will work closely with schools in his constituency as we roll out breakfast clubs in his patch and, indeed, across the country. He makes a number of really important points about the vital need to get the infrastructure in place for free school meals. We know that that is some of the learning from the work that the London Mayor has been doing.
Damian Hinds
I want to ask the Minister about two things. First, he talks about the disadvantage gap widening at the present time. Entirely coincidentally, I happen to have the numbers on key stage 2 and key stage 4. Of course, there are different ways that we can measure these things. I am looking at what is known as the “disadvantage gap index” for key stage 2 and key stage 4. I would be interested to know what definition he is using, from which he concludes that the Government inherited a widening disadvantage gap.
The second thing I want to ask him about is free school meal eligibility. We all absolutely recognise the value of free school meals. The Minister mentioned some of the extensions of eligibility that happened under the previous Government. The one that he did not mention was universal credit transitional protection. Even though unemployment came down from 8% to 4.5%, and the proportion of people in work but on low pay halved as a result of the increase to the national living wage, eligibility for free school meals went up, so the incoming Government have inherited one in three children being able to get a free school meal, as opposed to one in six when Labour were last in government. Notwithstanding this new clause, which the Government will not accept, what will they do to make sure that the same number of children as now can continue to get a free school meal?
Stephen Morgan
I am referring to a persistently high disadvantage gap. I will point out that this Government take child poverty extremely seriously. It is a stain on our society. That is why I am so proud that this new Labour Government have introduced a child poverty taskforce led jointly by the Secretary of State for Education and the Secretary of State for Work and Pensions. We will end child poverty. It is a stain on our society, and we are committed to making sure that we do everything we can and are publishing a strategy in due course.
With regard to transitional protections, I say to the hon. Member for North Herefordshire that my Department recognises the vital role played by free school meals and encourages all eligible families that need support to take up that entitlement. To make it as easy as possible to receive free school meals, we provide an eligibility checking service. On transitional protections specifically, we will provide clarity to schools on protections ahead of the current March 2025 end date.
The new ministerial taskforce has been set up to develop a child poverty strategy, which will be published in spring 2025. The taskforce will consider a range of policies, including the provision of free school meals, in assessing what will have the biggest impact on driving down rates of child poverty.
I appreciate the continued engagement of my hon. Friend the Member for Stroud on the issue of expanding free school meal provision to more pupils and on school food more broadly. He has raised concerns about obesity in particular and will be aware that the school food standards, which other Members have mentioned, apply to all food and drink served on school premises and, crucially, restrict foods high in fat, salt and sugar.
We are taking important measures through the Bill to ensure that the standards apply consistently across all state-funded schools. We are also clear that breakfast clubs are in scope of the standards. We recognise how important this issue is and want to ensure that free school meals are being delivered to the families that most need them. However, given the funding involved, that must be considered through the child poverty taskforce and the multi-year spending review. We remain committed to ensuring that school food is prioritised within Government. That is most clearly demonstrated through our breakfast clubs manifesto commitment, aimed at state-funded primary school pupils, which we are working hard to deliver.
Ellie Chowns
I welcome what I believe I heard: that the Minister maintains a relatively open mind on this question and will continue to look into it. He said that the effectiveness of the free school meal policy would be evaluated in the light of whether it was an effective mechanism for tackling child poverty. I want to re-emphasise that my arguments are not just about impact on child poverty. In considering expansion of free school meals, will he evaluate their effectiveness in terms of the full range of their potential benefits—not just the impact on child poverty, but health benefits, wider economic benefits and so on?
Stephen Morgan
As with all Government programmes, we will keep our approach under review and learn from what the evidence and data tell us. I can assure the hon. Lady that I met with a number of stakeholders, including the London Mayor, to understand the impact that the roll-out in London is having on not only household incomes, but children’s outcomes.
The hon. Member for North Herefordshire asked about specific points on the school food standards. It is important that children eat nutritious food at school. The school food standards define which foods and drinks must be provided and which are restricted. They apply to food and drink provided to pupils on school premises and during the extended school day up to 6 pm. As with all Government programmes, we will keep our approach to school food under continued review.
The hon. Member for North Herefordshire asked about the sustainable sourcing of food. This Government’s ambition is to source half of all food served in public sector settings from local producers or from growers certified to meet higher environmental standards where possible. We have committed to supporting schools to drive up their sustainable practices on food. Schools can voluntarily follow the Government’s buying standards, which include advice around sustainable sourcing. We mentioned earlier the Mayor of London’s roll-out of universal free school meals, and we are looking closely at evaluations and new evidence emerging from the scheme, including Impact on Urban Health’s recent evaluation. I have met with those stakeholders and heard of their experience of participating in the programme.
Finally, on whether the free school meals offer is more generous from devolved Administrations than in England, education, including free school meals policy, is a devolved matter. In England, we spend over £1.5 billion annually delivering free school meals to almost 3.5 million pupils across primary, secondary and further education phases. As with all Government programmes, we keep eligibility and funding for free school meals under review.
Ellie Chowns
I thank the Minister for his response. As I said at the start, I tabled this as a probing amendment and I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 3
Reporting of local authority performance regarding EHC plans
“In the Children and Families Act 2014, after section 40 insert—
“40A Reporting of local authority performance
(1) Local authorities must publish regular information relating to their fulfilment of duties relating to EHC needs assessments and EHC plans under this part.
(2) Such information must include—
(a) the authority’s performance against the requirements of this Act and the Special Educational Needs and Disability Regulations 2014 relating to the timeliness with which action needs to be taken by the authority in relation to EHC needs assessments and EHC plans;
(b) explanations for any failures to meet relevant deadlines or timeframes;
(c) proposals for improving the authority’s performance.
(3) Information published under this section must be published—
(a) on a monthly basis;
(b) on the local authority’s website; and
(c) in a form which is easily accessible and understandable.”” —(Ian Sollom.)
This new clause would require local authorities to publish their performance against the statutory deadlines in the EHCP process.
Brought up, and read the First time.
Ian Sollom
I beg to move that the clause be read a Second time.
I am moving new clause 3 on behalf of my hon. Friend the Member for Chelmsford (Marie Goldman). The Children and Families Act 2014 sets out timeframes for local authorities to decide whether to do an education, health and care plan needs assessment, and then for the resulting education, health and care plan to be issued. Local authorities have six weeks from application to decide whether to carry out an EHCNA, and a total of 20 weeks from application to issue an EHCP. Across England in 2023, however, only 50.3% of EHCPs were issued within that statutory 20-week deadline. Some places perform much worse than that—in Essex, only 0.9% were issued within the 20-week deadline.
New clause 3 is about reporting that. Transparency is a first key step in accountability, so publishing local authorities’ performance in relation to those statutory deadlines is the aim of the amendment as that first step. It is essentially a free change because local authorities already have the information gathered, so there should not be any additional resources needed. It could in fact help, because it would cut down on freedom of information requests, for example, which are a burden on councils. It will also cut down on the level of communication required with concerned parents constantly contacting to ask when their child is going to receive their EHCP.
Also included within new clause 3, local authorities will have the opportunity to explain any reasons and lay out their plans for improving performance. That kind of transparency helps direct resources well, and I think it is a good, sensible step,
Catherine McKinnell
I totally agree it is vital there is publicly available data regarding local authority performance on EHCPs. That is why we publish annual data on each local authority’s timeliness in meeting their 20-week deadline. Local authorities identified as having issues with EHCP timeliness are subject to additional monitoring by the Department for Education, which works with the specific local authority. Where there are concerns about the local authority’s capacity to make the required improvements, we have secured specialist special educational needs and disabilities adviser support to help identify barriers to EHCP timeliness and put in place practical plans for recovery.
Furthermore, when Ofsted and Care Quality Commission area SEND inspections indicate there are significant concerns with local authority performance, the Department intervenes directly. That might mean issuing an improvement notice or statutory direction or appointing a commissioner, deployment of which is considered on a case-by-case basis.
We are clear that the SEND system requires reform. We are considering options to drive improvements, including on the timeliness of support and local authority performance. We do not believe increasing the amount of published data and reporting on EHCP timeliness alone would lead to meaningful improvements in performance. We are working closely with experts on reforms. We recently appointed a strategic adviser for SEND who will play a key role in convening and engaging with the sector, including leaders, practitioners, children and families, as we consider the next steps for future reform of SEND.
In response to the hon. Member for St Neots and Mid Cambridgeshire, I absolutely respect the intentions of his amendment and the desire to see much greater timeliness and support for children with SEND and their families. We are working incredibly hard—this is a priority within the Department for Education—to get much better outcomes. We do not believe that this amendment will achieve the desired outcome, although we share the intention behind the amendment.
Munira Wilson
I appreciate what the Minister is saying. I agree with her that this is not a silver bullet. This will not suddenly improve the system. This is about transparency and accountability where, as my hon. Friend the Member for St Neots and Mid Cambridgeshire pointed out, there are some councils that are missing the targets by such a long chalk, and is about setting out the reasons for doing so. We know in some areas that frankly NHS partners are not working constructively with local authorities to help deliver EHCPs on time.
As the Minister looks at reforming the system—and I know from my discussions with her and the Secretary of State that the Government are working hard on this—could I urge that they seriously consider this provision. It is about transparency and accountability for parents, which I think is really important.
Catherine McKinnell
I thank the hon. Lady for that intervention and the hon. Member for St Neots and Mid Cambridgeshire for the way in which he presented this clause. We share the ambition for children with special educational needs and disabilities to get much better service, from their local authority and on their education journey. We recognise there are significant challenges for those who seek to deliver that being able to do so, which is why we are looking at reform in a whole-system way. We are looking to drive mainstream inclusion within our school system and to reduce the waiting times for assessments, which we know is led by the Department of Health and Social Care. This is a cross-departmental effort involving the Ministry of Housing, Communities and Local Government, the Department of Health and Social Care, the Department for Work and Pensions, and clearly the Department for Education has a key role in achieving a much better outcome for children with special educational needs. We absolutely take away the intentions of this amendment, but would appreciate it not being pressed to a vote as part of the Bill. The conversation about special educational needs and improving the outcomes for children will, however, without doubt continue.
Ian Sollom
I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
Ordered, That further consideration be now adjourned. —(Vicky Foxcroft.)