House of Lords

Monday 24th March 2025 Lords Chamber

Monday 24 March 2025

14:30

Prayers—read by the Lord Bishop of Gloucester.

Death of a Member: Baroness Howarth of Breckland

Monday 24th March 2025 Lords Chamber

Announcement

14:36

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, I regret to inform the House of the death of the noble Baroness, Lady Howarth of Breckland, on 23 March. On behalf of the House, I extend our condolences to the noble Baroness’s family and friends.

Retirement of a Member: Lord Alliance

Monday 24th March 2025 Lords Chamber

Announcement

14:37

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, I should like to notify the House of the retirement, with effect from 21 March, of the noble Lord, Lord Alliance, pursuant to Section 1 of the House of Lords Reform Act 2014. On behalf of the House, I thank the noble Lord for his much-valued service to the House.

Leave of Absence

Monday 24th March 2025 Lords Chamber

14:37

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, I wish to inform the House that on Tuesday 25 March and Wednesday 26 March, I will be visiting the French Republic on an official visit to the Senate. I therefore seek the leave of the House to be absent until Thursday 27 March.

Closed-Ended Investment Companies: Cost Disclosure

Monday 24th March 2025 Lords Chamber

Question

14:37

Tabled by

[Baroness Altmann]

To ask His Majesty’s Government what steps they are considering to ensure that investors in UK-listed closed-ended investment companies are not disadvantaged relative to investors in open-ended funds as a result of cost disclosure requirements and investment platforms refusing to allow transactions related to them.

[Baroness Wheatcroft (CB)]

My Lords, on behalf of the noble Baroness, Lady Altmann, I beg leave to ask the Question standing in her name on the Order Paper.

[The Financial Secretary to the Treasury (Lord Livermore) (Lab)]

My Lords, last year, the Government legislated to reform retail disclosure so that it is fairer and more proportionate. Recognising the concerns mentioned in the Question, the Government also took exceptional action to exempt investment companies from cost disclosure requirements to provide interim relief while the replacement regime is finalised. Operationalising this legislation is now a matter for industry and the regulator.

[Baroness Wheatcroft (CB)]

My Lords, I thank the Minister for that response, but despite the Government’s welcome SI, and FCA emergency guidance last November, some retail platforms continue to ban customers from investing in UK investment trusts that do not disclose their ongoing charging figures, even though those figures are misleading, as the Government accept. Will the Minister hold urgent talks with the FCA to insist that this barrier to investment be removed immediately?

[Lord Livermore (Lab)]

I am very grateful to the noble Baroness for the question. I also pay tribute to other noble Lords, including the noble Baronesses, Lady Altmann and Lady Bowles, for their continued championing of the investment trust sector and for bringing their concerns to the Government’s attention in their Private Members’ Bills in this Parliament and the previous one. As a result of their campaigning, the Government have now legislated to provide the Financial Conduct Authority with tailored powers to deliver a new disclosure regime. The Government have also temporarily exempted investment companies from cost disclosure legislation.

On the specific matter raised by the Question, of requirements by investment platforms for the investments they offer, that is now a matter for the industry and the regulator. While I recognise that the Government may not have gone as far as the noble Baroness would like, we have a shared objective of ensuring that that this reform achieves the right outcomes for investment companies and for the sector as a whole.

[Baroness Bowles of Berkhamsted (LD)]

My Lords, I declare my interest as a director of the London Stock Exchange. As the Minister said, in November, the PRIIPS SI made an immediate policy and legislative change in view of responses to HMT’s CCI consultation, aiming to free the investment trust market from incorrect legislation. Did the Government expect the FCA to reverse that in their December consultation? Will the Government reassert their policy? Will they also assert their policies against duplicative legislation and in favour of growth for consumer investments? If not, how do the Government expect to harness either retail or professional investment in this valuable sector for infrastructure?

[Lord Livermore (Lab)]

I am grateful to the noble Baroness for her question. I absolutely recognise the key role that the investment company sector plays in the UK’s economy, as she sets out, representing more than 30% of the FTSE 250 and investing in assets that support the Government’s growth agenda. We have listened to industry concerns and, last year, as the noble Baroness said, we legislated to reform retail disclosure. The FCA launched a consultation on an entire replacement regime in December. The Government look forward to seeing the outcomes of that consultation in due course.

[Lord Forsyth of Drumlean (Con)]

My Lords, what is going wrong when Parliament—and all credit to the Government for acting on this matter—and the Government pass a statutory instrument and the regulator then puts out a consultation document that provides for reversing what the Government have said should happen and what Parliament has decided? I know that the Minister must be aware of the number of Peers and others who have written on this matter. Surely the regulator is accountable to Parliament and the Government and should behave accordingly.

[Lord Livermore (Lab)]

I absolutely recognise the issues that the noble Lord raises. The Government’s view is that now that they have temporarily removed investment trusts from cost disclosure requirements, implementation is a matter for the industry. I recognise that there are some frustrations among the sector, but we believe that operationalising this legislation is a matter for the industry and the regulator.

[Lord Leigh of Hurley (Con)]

My Lords, I declare my interests as an investor in investment trusts and as a senior partner at Cavendish, which has written in to the consultations. It is quite clear that investment trusts offer members of the public the opportunity to invest in assets that would not otherwise be available to them and should be encouraged. The problem is that the rules were set in Brussels, and Europe does not have investment trusts. We now have the opportunity to do something bespoke and specific for us. Does the Minister agree that that will not be possible with the current structure that we have with the FCA and that it is now time that the FCA and, for that matter, FOS, were brought within government so that the situation as my noble friend Lord Forsyth explained it can be resolved?

[Lord Livermore (Lab)]

I do not think I can agree with the second part of the noble Lord’s question, but I absolutely agree that these vehicles do not exist in Europe and do exist in this country, which is exactly why the Government legislated to reform retail disclosure in the way that they did so that it is fairer, more proportionate and more suited for UK markets.

[Lord Watts (Lab)]

My Lords, does the Minister agree that the system needs to be transparent and, quite frankly, there need to be effective rules? If we have effective legislation or rules, and we have transparency, is that not what we are seeking?

[Lord Livermore (Lab)]

Yes, I agree with my noble friend. The Government have provided the Financial Conduct Authority with tailored powers to deliver a new disclosure regime that is fairer and more proportionate and, as I said in the previous answer, tailored specifically to UK markets. I know that the FCA is engaging extensively with the industry and other interested parties as it looks to finalise its rules.

[Baroness McIntosh of Pickering (Con)]

Does the Minister share my concern about what has happened to investment trusts over the past six to 12 months? What is the Government’s policy regarding saving?

[Lord Livermore (Lab)]

Yes, I do share the noble Baroness’s concern, which is exactly why we have done all the things that I have set out so far in this Answer. The Government’s policy regarding saving is that we think it is a good thing and we want to encourage more of it.

[Baroness Neville-Rolfe (Con)]

Does the Minister agree that the most important objective in the savings area is to ensure that sufficient investment opportunities are available, whatever their nature, to allow and encourage UK investors to save and invest, especially in UK stocks? Will he outline how the Government intend to support products that facilitate private investment in important areas such as property and infrastructure, as closed-ended funds are generally well suited to that?

[Lord Livermore (Lab)]

I am grateful to the noble Baroness for her question. What she is saying is right; the Government share her view. That is exactly why the Chancellor established the pensions review, for example, in her recent Mansion House speech. Her view is that the pensions review could unlock billions of pounds in additional investment in fast-growing businesses and infrastructure while improving outcome for savers. That is exactly the objective of that policy.

[Baroness Bowles of Berkhamsted (LD)]

My Lords, the Minister must know that some 329 firms and individuals signed a response to the HMT consultation, and there were many other submissions besides. The Government said that, in response to that consultation, they changed policy. How can that policy be changed a month later? This time, 558 firms and individuals have signed the response to the Financial Conduct Authority, with many more similar, separate responses. Does that not tell the Government that the direction of travel is wrong and that if they want this solved in less than another two years, by when this investment opportunity will be gone, they will have to intervene?

[Lord Livermore (Lab)]

I am grateful to the noble Baroness, again, for her question. I am not sure that we are going to agree on this specific point. I have already set out the Government’s position very clearly. I recognise that there are frustrations among some noble Lords and in the sector. It is the Government’s view that operationalising this legislation is a matter for industry and the regulator. The Government look forward to seeing the outcomes of the FCA’s consultation in due course.

[Baroness Bennett of Manor Castle (GP)]

My Lords, in an earlier answer, the Minister said that the Government want to encourage savings and think that saving is a good thing. How does the Minister square that with the fact that the Government are planning to increase the supply of credit to households, regarding that as a way to encourage growth? Despite the obvious risks that increasing household credit brings—and the fact that, as the Economics Observatory noted, consumer confidence remains weak, as it has been since the Brexit vote in 2016, and has declined since mid-2024—how do we square up encouraging savings and encouraging credit?

[Lord Livermore (Lab)]

The Government have a very clear objective of increasing living standards in all parts of the country. We want all households to have more money available to spend and to save.

[Baroness Bowles of Berkhamsted (LD)]

My Lords—

[Noble Lords]

Oh!

[Baroness Bowles of Berkhamsted (LD)]

Early last week, the Government published another statutory instrument in draft form with a lot of amendments to MiFID. Can we expect that those MiFID amendments to legislation will likewise be ignored by the Financial Conduct Authority in due course?

[Lord Livermore (Lab)]

I think that is a matter for the Financial Conduct Authority.

UK Energy: Grid Decarbonisation

Monday 24th March 2025 Lords Chamber

Question

14:48

Asked by

[Lord Offord of Garvel]

To ask His Majesty’s Government what assessment they have made of the impact of their plans to decarbonise the grid by 2030 on the United Kingdom’s energy security.

[The Minister of State, Department for Energy Security and Net Zero (Lord Hunt of Kings Heath) (Lab)]

My Lords, in an era of heightened geopolitical risk, switching oil and gas for home-grown clean energy from renewables and other clean technologies offers security that fossil fuels cannot provide. NESO’s independent modelling confirms that achieving clean power by 2030 is feasible, while ensuring security of supply without increasing costs to consumers, with scope for lower bills.

[Lord Offord of Garvel (Con)]

My Lords, this self-imposed target of decarbonising the grid by 2030 is all very admirable but is it realistic and is it achievable? Looking at my national grid app, it is telling me that right now, today, renewables are 43% of the grid and the rest is non-renewables. Noble Lords may have noticed that this is quite a good day for sun and wind, which is why it is at a high number. Last year, the average was 37% from green energy. That is precisely why this is unachievable, and a target that we cannot hit in 2030. In one simple word, it is called “baseload”. In China, they use coal for baseload and in America they use shale gas for baseload. That is why factory electricity is seven times cheaper in China and five times cheaper in the United States. We have abundant hydrocarbons in the UK and we have great nuclear capability. Is now not the time to review this target to make it realistic and, more importantly, affordable for British consumers and businesses?

[Lord Hunt of Kings Heath (Lab)]

No, my Lords, and I very much regret that the Opposition have withdrawn their support for policies taking us towards net zero, particularly in view of the fact that the noble Baroness, Lady May, took the decision when Prime Minister to legislate for the 2050 net-zero target. It is interesting, in relation to China, that the IEA reckons that 60% of the global expansion in renewable energy between now and 2030 will be in China. As for the noble Lord’s obsession with fossil fuels, the reason that we have these high prices, which the party opposite bequeathed to the country, is the unreliability and volatility of the international gas and oil markets. Getting clean power gives us energy security and much more reliability in prices.

[Lord Ravensdale (CB)]

My Lords, I declare my interest in the register. Can the Minister please update the House on the progress his department is making with banning the imports of Russian nuclear fuel? Importantly, when will it be taking those measures, with all the benefits that will bring for not only energy security but national security and our domestic industries?

[Lord Hunt of Kings Heath (Lab)]

I am grateful to the noble Lord for raising this question again. He will know that the Government have committed to prevent the import from Russia of nuclear fuels by 2030. We are discussing whether we could bring this forward. I am afraid I cannot give him any more information at the moment, but as soon as a decision is made, I will let him know.

[Viscount Hanworth (Lab)]

My Lords, since the announcement by President Macron in the autumn of 2021 of the France 2030 agenda, France has been committed to closing the nuclear fuel cycle. This means that it intends to use its uranium more efficiently and to deploy nuclear waste in its reactors. It is motivated by the supposition that, by 2050, the stocks of uranium will be pre-empted by the Chinese and the Americans. What is the Minister’s reaction to this supposition? Is the UK likely to follow the lead of France?

[Lord Hunt of Kings Heath (Lab)]

My Lords, the noble Lord will know that through Urenco, at Capenhurst, we are investing a considerable amount of money into the HALEU programme to enable us to have the whole fuel cycle undertaken in the United Kingdom. This is good for energy security and good for exports. I understand the point that the noble Viscount makes about uranium. We are confident in the future supply, but I acknowledge his underlying point of the importance of nuclear energy as an essential baseload.

[Baroness Sheehan (LD)]

My Lords—

[Lord Kirkhope of Harrogate (Con)]

My Lords—

[Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)]

My Lords, it is the turn of the Lib Dem Benches.

[Baroness Sheehan (LD)]

Does the Minister agree that consumers choosing green electricity as their preferred source of power is a powerful driving force for the increasingly rapid uptake of electric vehicles, for example, given that UK EV sales increased by more than 20% last year? Surely it is far better than relying on fossil fuel generation from unstable regions such as the Middle East and Russia for long-term energy security.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I totally agree with the noble Baroness that the wholesale move to electrification, not just in power generation but in transport, industrial processes and home heating, will lead us to be much more energy secure. We will ensure that we make the contribution we need to make to deal with climate change and we can grow the economy and bring thousands more green jobs to this country.

[Lord Kirkhope of Harrogate (Con)]

My Lords, there appears to be a contradiction. Certain Ministers are encouraging the farming industry to use as much of the good agricultural land as possible to produce food, and yet other parts of government are hell-bent on having solar panels everywhere, including on our best agricultural land. What exactly is the policy of the Government on this?

[Lord Hunt of Kings Heath (Lab)]

My Lords, I do not think there is any confusion at all. The policy is quite clear. We value our agricultural land, and the total amount of it that could be used by solar in future, over a considerable number of years, is less than 1%. The noble Lord may have noticed that, on 21 March, only two or three days ago, Great British Energy announced that its first major product will be the solar accelerator, which will enable hundreds of schools and hospitals across England to install new rooftop solar power. We are not just talking about the use of agricultural land. We want to see an expansion of solar, but it can be in relation to schools and hospitals and buildings as well.

[Lord Lennie (Lab)]

My Lords, when will the Government make a decision about the awarding of a contract for advanced small modular reactors in this country?

[Lord Hunt of Kings Heath (Lab)]

My Lords, a process for small modular reactors is being undertaken by Great British Nuclear at the moment. It has undertaken a technology appraisal, tenders have now come in, and I expect that the outcome of the process will be known by the end of spring. That is tied into SR discussions.

[Lord Alton of Liverpool (CB)]

My Lords, did the Minister note over the weekend the views of Unison and the Independent Anti-Slavery Commissioner, along with the letter sent by a Holocaust survivor to Mr Ed Miliband, all supporting the all-party amendment, which was passed by your Lordships’ House by a majority of 50, saying that there should be zero tolerance for the use of slave labour in supply chains? When Mr Miliband went to China last week, did he raise the use of Uyghur slave labour in the manufacture of solar panels and other green technology? Did he raise the use of child labour in the DRC in lithium and cobalt mining and their use in green technology, including these solar panels?

[Lord Hunt of Kings Heath (Lab)]

My Lords, I understand the noble Lord’s concern. He will know that the Great British Energy Bill is being debated in the other place in a day or two’s time. I understand the point that he raises and we will look at that letter with a great deal of consideration. We are committed to tackling the issue of forced labour in supply chains, and legislation and guidance are already in place to help businesses take action against modern slavery.

[Lord Howell of Guildford (Con)]

Could the Minister, who is usually very clear, be a little clearer with us about what is meant by decarbonising the grid by 2030? A number of authorities are saying that that is not what is going to happen at all. A number of gas-generating electricity stations are already being commissioned, and when they are there in 2030, as they will be, they will emit large amounts of carbon dioxide. How is that going to be handled? How is it going to be buried? Have the contracts begun for carbon capture and storage? It does not appear that there is much sign of that.

[Lord Hunt of Kings Heath (Lab)]

My Lords, the noble Lord will recall that we signed contracts in December to launch the first carbon capture, usage and storage project. We expect that, by 2030, clean sources of energy will produce at least 95% of Great Britain’s generation, and gas power generation will be there mainly as a back-up.

High-rise Buildings: Safety Remediation

Monday 24th March 2025 Lords Chamber

Question

14:58

Asked by

[Lord Young of Cookham]

To ask His Majesty’s Government what progress has been made on the remediation of high-rise buildings with safety defects.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, before I answer the noble Lord’s question, I pay tribute to all the campaigners and survivors of Grenfell who have moved this along, following seven years when little progress was made. Now, over half of 18 metre-plus buildings identified with unsafe cladding have started or completed remediation. On 2 December last year the Deputy Prime Minister announced the remediation acceleration plan, which sets out key measures to get buildings with unsafe cladding fixed faster, identify remaining buildings still at risk and ensure that residents are supported through the remediation process. This Government have been clear about our intention to deliver remediation faster, with more action from freeholders and developers.

[Lord Young of Cookham (Con)]

My Lords, I am grateful for that Answer. Since this Question was tabled, the Public Accounts Committee in another place has published a further progress report on remediation that is highly critical of this Government and indeed the last one. It points out that, of the 5,000 buildings known to the Minister’s department to require treatment, work has started on half, and that 3 million people are living in unsafe buildings, are unable to sell their flats and face exorbitant insurance claims. It also points out that the contract with developers did not require them to remedy all the safety defects. In the meantime, not a penny has been paid by the manufacturers of unsafe cladding. The PAC says that the date of 2029, by which all treatment should have been completed, is unrealistic. Surely we can do better than this.

[Baroness Taylor of Stevenage (Lab)]

The noble Lord is right to say that we can do better, which is why we have introduced the remediation acceleration plan. The plan’s targets provide greater certainty to residents, a significant acceleration in pace and much greater certainty about when cladding remediation will be resolved. We have never had targets like these before. This Government have put in place a plan to deliver; it is now up to those responsible for making their buildings safe to do so. The plan has been criticised by campaigners for not being ambitious enough and by industry for being too ambitious and unachievable. All plans like this must strike a balance; we believe this plan gets the right balance and is ambitious but also achievable.

[Baroness Warwick of Undercliffe (Lab)]

My Lords, the National Audit Office also found that, in the social housing sector, remediating cladding safety defects will cost £3.8 billion. The National Housing Federation says that housing associations could build 91,000 more affordable homes if the social housing sector had equal access to government funding to pay for building safety works. Substantial funding is being diverted away from investing in new affordable homes to pay building safety costs, so could I ask the Minister whether the Government have a plan to ensure that the social housing sector can deliver the 1.5 million new affordable homes target by making it eligible for the Government’s building safety funding?

[Baroness Taylor of Stevenage (Lab)]

My noble friend is right to point to the strains on social housing between remediation of all kinds of maintenance defects, including fire safety, and building new affordable housing. From April, we will increase targeted support for social landlords applying for government remediation funding. That will help them meet the costs of planning and preparing for remediation works, and to start remedial work sooner. Social landlords can apply for government remediation funding equivalent to the amount that would otherwise have been passed on to leaseholders, or for the full cost of the works where remediation would render a social landlord financially unviable. We have committed £568 million to support the remediation of social housing through government schemes.

[Lord Carter of Haslemere (CB)]

My Lords, the Public Accounts Committee points out that developers, social housing providers, landlords and owners—everyone, it seems, except the culpable manufacturers of this cladding—are being made to contribute to the costs of remediation. What is being done to ensure that the culpable manufacturers of this cladding will be made to contribute?

[Baroness Taylor of Stevenage (Lab)]

I agree with the noble Lord that it is very important that the enforcement we set out is carried out. We have already committed £14 million to local authorities to build the capacity and capability to take that enforcement action, and the Deputy Prime Minister has announced increased funding to double that enforcement activity. In addition to enhancing the national joint inspection team, we will ensure local authorities continue to have access to expertise they can call on around their most complex and high-risk buildings. But it is vital that those who are responsible for this are both brought to account and contribute to the remediation work that needs doing.

[Baroness Scott of Bybrook (Con)]

My Lords, the Government have identified that barriers to development-led remediation include disputes between developers and freeholders over access to buildings, delays in securing the necessary regulatory approvals and access to independent assessors to carry out the quality of assessments. Will the Minister set out what the Government are doing to overcome these barriers to vital progress?

[Baroness Taylor of Stevenage (Lab)]

The remediation action plan points to the action that we need to take to move this on more quickly. Developers have determined whether work is required on about 80% of buildings for which they have taken responsibility under the remediation contract. Both developers and the Government are committed to accelerating that progress, which is why we have the plan that we published on 2 December as a joint plan. Thirty-nine developers have signed up to that and we will be moving that forward. If they fail to hit those joint plan targets, further action will be taken.

[Baroness Pinnock (LD)]

My Lords, the Government have introduced a new and lower standard of remediation, PAS 9980. Insurers, however, are not convinced that this makes buildings fully safe. The Public Accounts Committee has brought it to our attention that insurance costs remain, in its word, “unaffordable”. What are the Government going to do to address the criticism of the Public Accounts Committee and ensure that insurance costs drop considerably, so that people can afford to remain in their homes?

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness is quite right to raise the issue of insurance premiums. Work has been going on to reduce those premiums for leaseholders. We have seen improvements for leaseholders who previously found themselves unable to sell or remortgage their homes, but we remain vigilant and will continue to hold the 10 major lenders to account, following their commitment to lend on properties even if the remediation is not yet complete.

[Lord Wigley (PC)]

My Lords, I draw the attention of the House to a family interest in a high-rise flat. Does the Minister accept that it is a matter not just of getting an agreement to starting dates on these schemes of remediation but of completion dates? Many schemes seem to be dragging on and on, and there will not be satisfaction in terms of safety reassurance or saleability until there is a much more stringent approach to the completion date of this necessary work.

[Baroness Taylor of Stevenage (Lab)]

The noble Lord is quite right: we need to move this on as quickly as we can. It has dragged on for far too long already. As of March 2025, we have 39 developers signed up to the joint acceleration plan. These developers account for more than 95% of the buildings to be remediated by developers under the developer mediation contract. They have committed for the first time to assess all their buildings by July 2025 and to start or complete all remedial work by July 2027—but I take the noble Lord’s point that completing the work is the vital thing for those living in them. We will be monitoring this very carefully and chasing up the completion of those works as time goes on.

[Lord Katz (Lab)]

My Lords, we will not complete the remediation work that we are discussing under this Question, nor achieve the Government’s ambitious but very welcome target of 1.5 million new homes being built, without the necessary skilled workforce. We know from the Office for National Statistics that there are 35,000 job vacancies in the construction sector, over half of which cannot be filled due to a lack of skills—the highest for any sector. Does my noble friend agree that it was a very welcome announcement from the Treasury last week that the Government plan to inject £600 million into training up 60,000 more construction workers by 2029? Will she further tell the House how we can encourage the construction sector itself to invest in more brickies, chippies and sparkies who can build the safe homes that we all need?

[Baroness Taylor of Stevenage (Lab)]

I totally agree with my noble friend. I was very pleased to hear yesterday that in the Spring Statement there will be an announcement of £600 million investment into the construction and skills sector, delivering around 60,000 workers over the course of the Parliament. We need to address the leaky pipeline and to expand course provision to make sure there is enough funding for training routes and apprenticeships, skills boot camps and other further education courses. Then we need to ensure the system has the required capacity. To deliver those courses, we need to address the 10% vacancy rate for construction teachers and be imaginative in how we do that. We need to take every action we can to get the right people with the right skills in the right places. It is one of the most important pieces of the puzzle that we must get right.

Sentences of Imprisonment for Public Protection

Monday 24th March 2025 Lords Chamber

Question

15:09

Asked by

[Baroness Burt of Solihull]

To ask His Majesty’s Government how many people currently serving imprisonment for public protection (IPP) sentences, whether in prison or on licence in the community, have served more than 10 years over their original tariff; and what percentage of people serving IPPs this represents.

[The Minister of State, Ministry of Justice (Lord Timpson) (Lab)]

On 31 December 2024, 695 unreleased IPP prisoners were 10 years or more over tariff, representing 67% of this population. Data on the number of recalled IPP offenders who have served 10 years or more over their tariff is not centrally collated. On 30 September 2024, 2,320 IPP offenders on licence were 10 years or more over tariff, representing 80% of those in the community. On 1 November, 1,742 licences were terminated following the commencement of reforms in the Victims and Prisoners Act 2024.

[Baroness Burt of Solihull (LD)]

I thank the noble Lord for his Answer; I know how hard he is working on this issue. I appreciate that some of the data I asked for is not collected. Nevertheless, the fact remains that almost 700 IPP prisoners who have never been released from prison have been locked up for more than a decade longer than their original sentence indicated. For most of them, this is because their mental health is in such a terrible state. Does the Minister accept that, in many of these cases, it was the IPP sentence itself that broke their mental health, trapping them in a self-perpetuating nightmare? Does he agree that resentencing these prisoners with appropriate safeguards and help is the only way to rid this country of this terrible stain on our justice system?

[Lord Timpson (Lab)]

I thank the noble Baroness for her question and the interest she has in this important area. I assure her and all noble Lords that I am not giving up on anyone. So far as mental health of IPP prisoners and all prisoners goes, the Chief Medical Officer has agreed to include consideration of the IPP sentence in his independent review of offender health this year, which I am really pleased about. On resentencing, public safety has to come first. The Parole Board is expert in deciding who is safe to be released and who is not. That is why the IPP action plan is absolutely vital, and we need to make sure we keep making good progression on it.

[Lord Woodley (Lab)]

My Lords, like many others, including the previous speakers, I believe that resentencing is the only way to wipe the IPP stain off our justice system for good. But the Government, as has just been mentioned, are worried about the overruling of the Parole Board. Does the Minister agree that initially limiting resentencing to those already living on licence in the community fully addresses this objection, as the Parole Board has already decided that they are safe for release?

[Lord Timpson (Lab)]

I thank my noble friend for his question. Those in the community are already benefiting from the significant changes to the IPP licence period in the Victims and Prisoners Act 2024, which provides an avenue for an earlier end to the sentence after a successful period in the community. Resentencing those living in the community would halt the risk management and support provided to these individuals, some of whom will be at the critical moment of being recently released from custody. Although this is not a good example of someone who has been released, at every prison I go to I always ask to meet an IPP prisoner and sit in their cell or an office and talk to them and find out their situation. Recently, I met an IPP prisoner who is 11 years over tariff. He spent eight years at Rampton Hospital, and he has not engaged at all in his sentence. The action plan is not working for him. That is why it is really important that we give people hope, and for me the action plan is the way to do that.

[Lord Carter of Haslemere (CB)]

My Lords, building on the previous question, there are many IPP prisoners who have been considered safe to be released by the Parole Board and have been released but have then been recalled to prison for reasons other than a further offence. Are the Government considering whether different considerations come into play for released and then recalled IPP prisoners—they were previously considered safe to be released—in terms of risk assessment and the possibility of future release?

[Lord Timpson (Lab)]

The Victims and Prisoners Act 2024, which I have mentioned, introduced a new power to enable the Secretary of State to release recalled IPP and DPP prisoners using a risk-assessed recall review where safe to do so, without the offender requiring a release decision from the Parole Board. We now consider every recalled IPP and DPP offender for RARR, as it is called. This has already been used to enable swifter release and, in some cases, we have seen recalled IPP prisoners released several months ahead of their parole hearing. The noble Lord will know that not everyone who is recalled to prison is an IPP prisoner, but 30% of IPP recalls are because of a further charge for an alleged offence.

[Baroness Ludford (LD)]

My Lords, the Government decline to do anything radical to end the Orwellian system of IPP sentences because they are concerned about public protection. Obviously, we all are, but there is no absolute guarantee that non-IPP prisoners will never reoffend. Why, then, do the Government pursue this unrealistic goal for IPP prisoners, thereby trapping them in a limbo that is rightly described—not only by my noble friend but across the political spectrum—as a terrible stain on our criminal justice system?

[Lord Timpson (Lab)]

I agree with the noble Baroness that it is a terrible stain on our justice system. In the job that I am doing, it is my job to make sure that as many IPP-sentenced prisoners engage with the action plan, get released, stay out and not come back. In 2024, the number of IPP unreleased fell by 182, and recalls fell by 83, but noble Lords will, I am sure, be aware that we are dealing with a number of issues in our prisons at the moment to do with a lack of capacity. We are battling to make sure that we get prisoners in the right prison to engage with the action plan, and hopefully they will get out and stay out.

[The Lord Bishop of Gloucester]

My Lords, taking into account what has been said already, I welcome the enactment of the provisions in the Victims and Prisoners Act, passed by the last Government, allowing termination of licence conditions for IPP prisoners. However, there are huge legal complexities involved, so I wonder what steps the Government are taking to ensure that those eligible to terminate their licence conditions actually understand their rights and are able to exercise them.

[Lord Timpson (Lab)]

I thank the right reverend Prelate for her question, and I agree with her. I have met IPP prisoners, both in prison and in the community, who are not fully aware of the situation they are in and what they need to do from here, so she raises a good challenge to me and my colleagues in the Ministry of Justice, which I will take away and reflect on and get back to her.

[Lord Moylan (Con)]

My Lords—

[Baroness Fox of Buckley (Non-Afl)]

My Lords—

[Baroness Meacher (CB)]

My Lords—

[Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)]

My Lords, we will hear from the noble Lord, Lord Moylan, next.

[Lord Moylan (Con)]

My Lords, given that so many of those prisoners serving this sentence who have never been released are suffering from chronic mental illness, is it not time for them to be considered for transfer and treatment in a mental health setting and not in prison anymore? I mean that systematically, and not simply ad hoc, as when individuals are transferred, as I know some are, to a mental prison. In that connection, what consideration have the Government given to the proposal from the Royal College of Psychiatrists for the development of a regime parallel to Section 117 of the Mental Health Act to offer support to these people if they do achieve release through that route?

[Lord Timpson (Lab)]

There are 241 IPP prisoners in secure mental health settings as of the last figures published. It is those who are of real concern to me, because they are so far away from being safe to be released. We need to make sure that we support them—as in the example I gave earlier of the prisoner whom I met recently—in their journey. The work that the Government are doing on the Mental Health Act, with the provisions being put in place, will, hopefully, contribute to a more successful outcome.

[Baroness Fox of Buckley (Non-Afl)]

My Lords—

[Baroness Meacher (CB)]

My Lords—

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, we will hear from the noble Baroness, Lady Fox, next.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, following on from the request of the noble Baroness, Lady Burt, for more detailed data, will the Government make public detailed data of the different gradations of risk presented by the various cohorts of the IPP prisoner population, assuming that they are not treated as an undifferentiated blob? Then, could the Government apply the same risk-assessment criteria used for early release decisions to the least risky IPP prisoners and release them now—hardly early—because to exclude IPP prisoners from emergency measures to ease overcrowding seems irrational and even cruel?

[Lord Timpson (Lab)]

The noble Baroness will be pleased to know that I raised this when we had the Peers round table a few months ago—I am hoping to have another one in May—when we talked about the RAG rating of IPP prisoners. At the time, we just RAG rated those in prison, and I am pleased that everybody in the community is now also RAG rated, which will help. I am hopeful that noble Lords will suggest to me what they would like on the agenda for our round table, which I hope will be in May. Maybe we can discuss the important questions around data then.

Church of Scotland (Lord High Commissioner) Bill

Order of Commitment discharged & 3rd reading
Monday 24th March 2025 Lords Chamber

Committee (and remaining stages)

15:21

Order of Commitment

Moved by

[Baroness Smith of Basildon]

That the order of commitment be discharged.

[The Lord Privy Seal (Baroness Smith of Basildon) (Lab)]

My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Unless, therefore, any noble Lord objects, I beg to move that the order of commitment be discharged.

Motion agreed.

Bill reported without amendment. Report agreed without debate.

Motion

Moved by

[Baroness Smith of Basildon]

That the Bill be now read a third time.

[The Lord Privy Seal (Baroness Smith of Basildon) (Lab)]

My Lords, I have it in command from His Majesty the King to acquaint the House that His Majesty, having been informed of the purport of the Church of Scotland (Lord High Commissioner) Bill, has consented to place his prerogatives and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

Motion agreed.

15:22

Motion

Moved by

[Baroness Smith of Basildon]

That the Bill do now pass.

[Baroness Smith of Basildon (Lab)]

My Lords, I thank all noble Lords who spoke during the Second Reading debate. It was one of the most positive debates I have ever taken part in in this place. Since the Bill has attracted no amendment and was debated only last week, I will not take up too much of the House’s time today. As I said in the debate, the Bill has a simple aim. It is designed to remove a legal barrier that prevents Roman Catholics holding the office of Lord High Commissioner. The upcoming appointment of Lady Elish Angiolini as the first Roman Catholic Lord High Commissioner would have been blocked by historic legislation if it were not for this Bill. Her appointment is a strong gesture of good faith, co-operation and togetherness between the Church of Scotland and the Catholic Church in Scotland, building on the St Margaret declaration signed in Dunfermline Abbey in 2022.

At Second Reading we heard many powerful speeches from across the whole House, and the impact of those comments really go beyond this Bill. Your Lordships spoke powerfully about the symbolic significance this appointment will demonstrate, not just to two different denominations of Christianity but across society. The values of tolerance, respect and dignity were the running theme of last week’s debate—values symbolised by this appointment. Lady Elish is an accomplished public servant. Your Lordships and Members of the other place have spoken highly of her career and achievements and have warmly welcomed her to her role, and I wholeheartedly agree. There is only one obstacle that prevents her taking up the role, and that is an archaic legal restriction. By passing this Bill removing the restriction, the House can give its support to Lady Elish with our best wishes for her tenure as Lord High Commissioner.

Finally, I express my thanks to all those who have been involved in preparing and passing this Bill. In particular, I thank the Scottish Government, the Church of Scotland and Lady Elish herself. I thank the usual channels and Members on the Front Bench opposite for supporting and facilitating the accelerated timetable for the Bill. I also thank the Bill team from the Cabinet Office and the constitution division for their work in bringing the legislation forward. It is a practical step to remove a relic of a past age that has no place in today’s society. In that spirit, I beg to move.

[Lord True (Con)]

My Lords, I thank the Minister for the way she has piloted the Bill. I confirm what she said: the unanimity in the House at Second Reading was moving. There was very broad and deep support for the Bill and for this enlightened appointment by His Majesty the King. This House bears great good will towards Lady Elish as she takes on this appointment. We on this side thank the Minister and all those involved behind the scenes in preparing the Bill, and we wish it godspeed.

[Lord Wallace of Tankerness (LD)]

My Lords, I also thank the Leader of the House, and I echo what the noble Lord, Lord True, said about the debate we had last week. It was quite remarkable, for two reasons. First, there was a historic stain that we wanted to remove. Secondly, we had confidence in the ability of Lady Elish to fulfil the role proposed for her.

I also give thanks to those in the Bill team; I would not say it has been done at breakneck speed, but it had to be done very quickly to meet the deadline of the General Assembly in May. I know that the work done by the Chancellor of the Duchy of Lancaster has been very much appreciated, so I add my thanks—not least to the noble Baroness—that we have managed to get this legislation through. I look forward to seeing Lady Elish at the General Assembly on 17 May.

[Baroness Smith of Basildon (Lab)]

My Lords, I do not think there is much I can add to that. I think the House welcomes the breakout of agreement and co-operation in the House. Long may it last.

Bill passed.

Non-Domestic Rating (Multipliers and Private Schools) Bill

3rd reading
Monday 24th March 2025 Lords Chamber

Third Reading

15:27

Clause 7: Commencement

Amendment 1

Moved by

[Baroness Barran]

1: Clause 7, page 6, line 14, leave out subsection (2)

[Baroness Barran (Con)]

My Lords, I rise to speak to my three amendments for this Third Reading. My amendments are simple and seek to remove any reference to private schools following the removal of Clause 5. I hope very much that the Government will accept these amendments to ensure that we send a clean copy of the Bill to the other place.

I am pleased that the two important principles we debated during the passage of the Bill were upheld by the House on Report: first, that the tax on education should be removed from the Bill; and, secondly, that we should not introduce a two-tier system for charities. I was glad to have the support of noble Lords across the House to remove Clause 5, and give particular thanks to the noble Lord, Lord Storey, who co-signed that amendment.

This clause on its own will raise only £70 million for the Exchequer, but its impact cannot be ignored. It comes at a time when the Government have already hit independent schools with additional costs through their decision to introduce VAT on school fees in the middle of a school year and the increase in employer national insurance contributions. This suggested change would exclude independent schools from charitable business rates relief. Although it would raise minimal amounts for the Treasury, it would damage schools disproportionately.

As previously discussed, the Bill would create a two-tier charity system, allowing the Government to treat charities differently and bringing politics into charity law. Our charities and charitable schools should not be subject to this, and I am very glad that noble Lords from across the House agreed. I beg to move.

15:30

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, the noble Baronesses, Lady Barran and Lady Scott of Bybrook, have tabled three amendments consequential to the amendments passed on Report. As these simply refine those amendments that have already been passed, we do not oppose them.

Amendment 1 agreed.

Clause 8: Short title

Amendment 2

Moved by

[Baroness Barran]

2: Clause 8, page 6, line 17 leave out “and Private Schools”

Amendment 2 agreed.

In the title

Amendment 3

Moved by

[Baroness Barran]

3: Title, line 4, leave out from “England” to end of line 5

Amendment 3 agreed.

15:31

Motion

Moved by

[Lord Khan of Burnley]

That the Bill do now pass.

[Lord Khan of Burnley (Lab)]

Through this Bill, the Government are delivering on the pledges set out in their manifesto. I thank all noble Lords who have dedicated so much of their time to scrutinising the Bill and have been diligently working with the Government to ensure that their desired outcomes align with the Government’s intentions. This has kick-started a long-overdue transformation of the business rate system, so that it can be fairer, protect the high street and support investment, and that it is a system fit for the 21st century.

On top of this, the Government seek to secure additional funding to help deliver on commitments to education and young people by concentrating on the broader picture of the state sector, where most children are educated. While there have been amendments made to the Bill for the Commons to consider, the Government do not accept them. The Bill, as it entered the House, would deliver on the Government’s missions to rebuild Britain. The amended state of the Bill does not go far enough in the ambition to kick-start economic growth and eliminate barriers to opportunity.

I extend particular thanks to the noble Baronesses, Lady Scott of Bybrook, Lady Barran and Lady Pinnock, the noble Lords, Lord Jamieson, Lord Thurlow, Lord Fox, Lord Moynihan, Lord Lexden, Lord Storey and Lord Shipley, and the noble Earl, Lord Lytton, for their considered approach to the Bill. I am grateful for the conversations we have had throughout the Bill’s time in this House. Their passion and expertise have been invaluable. Our discussions about the issues have been reflective of the strong feelings shared by many across the country. I thank noble Lords for their advocacy and participation. I also extend my gratitude to the Bill team—Zoe Hawthorne, Nick Cooper and Chloe Horn—for their technical expertise and handling of the Bill. In particular, I am grateful to my private office and my private secretary, Daisy Brittle. I beg to move.

[Baroness Barran (Con)]

My Lords, in concluding this Bill, I first thank my noble friends who have supported me, in particular, my noble friends Lady Scott of Bybrook and Lord Jamieson, in our work to protect high streets and independent schools. I also thank noble Lords from across the House, who have spoken in support of the many sectors that risk being negatively impacted by the Bill. In particular, I thank the noble Lord, Lord Fox, and the noble Baroness, Lady Pinnock, for their work on helping businesses up and down the high street. I thank the noble Lord, Lord Storey, for his support in protecting independent schools, and the noble Lord, Lord Thurlow, for his amendment that calls for the reform to the business rate system that the Government have failed to deliver through the Bill. I thank the Minister for the very constructive and positive way that he has engaged throughout the passage of the Bill.

On these Benches, we are pleased that a number of issues, on which the House has been united, have allowed us to encourage the Government to make changes to the Bill. Anchor stores, manufacturing businesses and healthcare hereditaments will likely face increased business rates through these proposed changes, especially with regard to the higher multiplier. I hope the other place will consider the sensible amendments that retain the current standard multiplier for these crucial sectors.

The amendment in the name of my noble friend Lord Jamieson is key in exploring the impact of the threshold of the higher multiplier. Its cliff-edge nature is particularly concerning, and despite the Government’s insistence that they want to focus on growth, this threshold will impact the decisions many businesses will take, and not in the direction that the Government seek.

The noble Lord, Lord Thurlow, is right to call on the Government to consider when they will pursue a reform of the business rate system, in line with their manifesto commitment, to ensure that online giants pay their fair share of business rates. As the Government have not delivered such reform, they should indeed commit to publishing a review of when they will do so.

As I said in relation to my amendments, I was pleased to see Clause 5 removed, given that it addresses directly the principle of taxing education and having a two-tier charity system. We on these Benches look forward very much to seeing the response in the other place to these very reasonable issues.

[Baroness Pinnock (LD)]

My Lords, I start by thanking the Minister and his civil servants in the Bill team for the very helpful discussions to aid detailed understanding of the Bill. The one issue that still irks me is that it was debated without an impact assessment. The convention now seems to be that this is the case, but I find it unacceptable that we have debated and agreed a Bill of this nature and with the implications that it has on many businesses. I believe it is unacceptable to do so without an impact assessment.

However, we on these Benches are delighted that the 290 hospitals which were destined to have the higher-rate multiplier applied will be excluded from that penalty. We hope that the other place will agree with the sanity of this proposal. The Minister said that the aim of the Bill was to protect the high street. It is not clear that that will be achieved by the Bill, and only time will tell, but I am sure the Minister will be pleased to know that I will be keeping a watchful brief on this issue and questioning him at regular intervals if the high street is not benefiting from these elements of the Bill.

Given that, I thank my noble friend Lord Fox, who did much of the work on the implications for business, and the ever knowledgeable and wise Elizabeth Plummer in our Whips’ Office, who was able to give me sound advice on the course of the Bill. With that, I thank the Minister and look forward to the consequences of the Bill.

[The Earl of Lytton (CB)]

For my part, I too add my thanks to the Minister for his willingness to engage at all times. As he now knows, business rates is a rather niche area of activity for your Lordships. I started my professional career just over 50 years ago in the Inland Revenue Valuation Office, so I have been tied to this problem for a long time. If I have come across as a bit of a business rates nerd, I apologise to the House.

The Minister mentioned Mr Nick Cooper, whom I have known a long time through several Administrations, and I think it was he who was astute enough to observe that this might, given that my time here may be limited as a retained hereditary Peer, this might be the last occasion on which I would have to bore your Lordships on a matter to do with business rates. So there is something positive for your Lordships to look forward to.

I thank the noble Baronesses, Lady Scott of Bybrook and Lady Pinnock, and the noble Lord, Lord Fox, and my colleague and noble friend Lord Thurlow, for their willingness to discuss matters of crucial importance.

I take the point made by the noble Baroness, Lady Barran, that the manifesto said one thing and this is not what we were led to expect. However, for all the talk and all the policy-making, and for all the manifestos, you do not get to alter economic reality, nor do you get to alter markets very much. Therefore, I suspect that the process of partial attrition which has gone on in the business sector, particularly over issues to do with high streets, will continue, so long as the root and branch reform that is so badly needed and which successive Administrations have promised is not delivered. It is tough when you are dealing with something that is cheap to collect, but we must understand the consequences of lack of fairness and lack of balance, and what this means for business decisions made here and where moving an operation abroad is an alternative.

Finally, I thank Jerry Schurder and Simon Green of Newmark surveyors, who have been an unfailing source of useful information on the background to current business rates. I am not a current practitioner, so I pay tribute to them and to others from the Rating Surveyors’ Association and the RICS, both of which I am a member of.

With that, I wish this Bill well. I am certain that it will reappear. I am not complacent that this is the last word on the matter, but we have given it our best shot in what is a rather difficult and complicated area. I wish it well and share the views of other noble Lords in hoping that the other place has regard to the rationale behind our efforts.

[Lord Khan of Burnley (Lab)]

My Lords, I thank noble Lords for their contributions.

Bill passed and returned to the Commons with amendments.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Consideration of Commons amendments and / or reasons
Monday 24th March 2025 Lords Chamber

Commons Amendments

15:42

Motion A

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 1, to which the Commons have disagreed for their Reason 1A.

1A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

[The Financial Secretary to the Treasury (Lord Livermore) (Lab)]

My Lords, in moving Motion A, I will speak also to Motions E, E1, H, H1, W and W1. Before I address these Motions directly, I will briefly set out why the Bill before your Lordships’ House is necessary.

Upon taking office, this Government inherited three distinct crises: a crisis in the public finances; a crisis in our public services; and a crisis in the cost of living. That included a £22 billion black hole in the public finances, public services at breaking point, NHS waiting lists at record levels, and working people suffering the worst cost of living crisis in a generation, with inflation having reached over 11%. Faced with this reality, any responsible Government would need to act. That is why we took action in the Budget to wipe the slate clean, to repair the public services, to protect working people and to invest in Britain. That included an historic investment of an additional £25.7 billion for the NHS, which is helping to bring down waiting lists more quickly and put an end to over a decade of underinvestment and neglect.

We took this action in the fairest way possible, by keeping our manifesto promises to working people not to increase their income tax, national insurance or VAT. However, we needed to take some very difficult decisions elsewhere on tax, including the changes to employer national insurance contributions contained in this Bill. Following this change, more than half of businesses with national insurance liabilities will see no change or will see their liabilities decrease, and 865,000 employers will now not pay any national insurance at all next year.

We have consistently acknowledged that some businesses will now contribute more and that the impacts will be felt beyond businesses. This was a difficult decision, but it was the right decision, because not acting was simply not an option. As a result of the decision, and others, taken in the Budget, we have created a foundation of stability on which we are now taking forward our agenda of growth and reform.

There are consequences to responsibility, but the consequences of irresponsibility for the economy and for working people would have been far greater. We saw that with the Liz Truss mini-Budget, which crashed the economy and increased typical mortgage payments by £300 a month.

15:45

I now turn specifically to Amendments 1B and 5B, tabled by the noble Lord, Lord Scriven, and Amendment 8B, tabled by the noble Lord, Lord Londesborough. These amendments seek to include powers as part of this Bill to exempt certain groups from the changes to the employer national insurance rate and threshold in future. This includes powers to exempt from changes to the employer national insurance rate and threshold: care providers; NHS GP practices; NHS-commissioned dentists and pharmacists; charitable providers of health and care; and those providing hospice care. It includes powers to exempt businesses or organisations with fewer than 25 full-time employees from the change to the employer national insurance threshold.

The revenue raised from the measures in this Bill will play a critical role in repairing the public finances and rebuilding our public services. Clearly, any future changes which exempt certain groups from paying national insurance would have cost implications, necessitating either higher borrowing, lower spending, or alternative revenue-raising measures. For this reason, I respectfully ask noble Lords to withdraw Amendments 1B, 5B and 8B.

Amendment 21B, tabled by the noble Baroness, Lady Neville-Rolfe, seeks to require the Government to lay before Parliament a review of the impact of measures in this Bill on a number of sectors. The Government carefully consider the impacts of all policies, including the changes to employer national insurance. As I have said previously, an assessment of this policy has been published by HMRC in its tax information and impact note. The independent OBR’s Economic and Fiscal Outlook also sets out the expected macroeconomic impact of the changes to employer national insurance contributions. The Government and the OBR have therefore already outlined the impacts of this policy change. This approach is in line with previous changes to national insurance and previous similar changes to taxation, and the Government do not intend to provide further impact assessments. For this reason, I respectfully ask the noble Baroness not to press this amendment. I beg to move.

Motion A1 (as an amendment to Motion A)

Moved by

[Lord Scriven]

At end insert “, and do propose Amendment 1B in lieu—

1B: After Clause 1, insert the following new Clause—
“Exemptions from the changes made by section 1: NHS and social care
(1) The Treasury may by regulations made by statutory instrument specify that certain categories of persons are exempted from the changes to the rate of secondary Class 1 contributions made by section 1 of this Act.
(2) The categories of persons any of whom may be specified under subsection (1) are—
(a) a person providing a care home service or a domiciliary support service who is regulated under—
(i) Part 1 of the Health and Social Care Act 2008, or
(ii) Part 1 of the Regulation and Inspection of Social Care (Wales) Act 2016;
(b) a person providing a service who is regulated under section 47(1)(a) or (b) of the Public Services Reform (Scotland) Act 2010;
(c) a person providing a care home service or domiciliary support service regulated under the Health and Personal Social Services (Quality, Improvement and Regulation) (Northern Ireland) Order 2003;
(d) a person contracted to provide primary care under the provisions of—
(i) Part 4 of the National Health Service Act 2006,
(ii) Part 4 of the National Health Service (Wales) Act 2006, or
(iii) sections 17J to 17O of the National Health Service (Scotland) Act 1978;
(e) a person providing primary medical services through contractual arrangements with a Health and Social Services Board;
(f) a person contracted to provide general dental services under the provisions of Part 2 of the National Health Service (General Dental Services) Regulations 1992;
(g) a person providing general dental services under Part 2 of the General Dental Services (Northern Ireland) Regulations 1993;
(h) a person contracted to provide pharmacy services under the provisions of—
(i) Part 7 of the National Health Service Act 2006, or
(ii) Part 8 of the NHS (Pharmaceutical and Local Pharmaceutical Services) Regulations 2013;
(i) a person providing pharmaceutical services under Part 2 of the Pharmaceutical Services Regulations (Northern Ireland) 1997;
(j) a charitable provider of health and care;
(k) a provider of health and care registered as a charity by the Charity Commission for Northern Ireland;
(l) a person providing hospice care whether in a hospice or elsewhere;
(m) a carer to whom section 2(3A) of the National Insurance Contributions Act 2014 applies.
(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.””

[Lord Scriven (LD)]

My Lords, on Report, this House passed Lords Amendment 1 and a number of consequential amendments to exempt NHS services and social care from the Government’s hike in employer national insurance contributions. I am grateful that the House agreed with these Benches that such a rise will have potentially devastating consequences for those that form the backbone of community healthcare and the people they serve. Despite the immense financial pressure that these vital services already face, and despite the clearly expressed views by this House, the Government have chosen to overturn our amendments in the Commons. We accept the Commons reasons that these amendments engage Commons financial privilege, and we will not seek to break with convention today by asking the House to look at alternative amendments that would produce the same response.

This brings me to Motion A1 in my name, which seeks to introduce Amendment 1B in lieu, and Motion E1, which seeks to introduce Amendment 5B in lieu. They look complicated, but they really are very simple. These amendments would introduce a regulation-making power to allow the Government, at a later stage, to exempt social care, pharmacists and other NHS services included in my original amendment. Noble Lords will know that I do not propose this lightly. We on these Benches are naturally suspicious of giving any Government such powers without full scrutiny provided in primary legislation, but we are so profoundly worried about the impact of the Bill on the NHS and social care.

My amendment seeks to address the deeply concerning implications of the national insurance contribution increases for our vital health and social care providers, NHS dentists, community pharmacists, hospices, GPs and social care organisations. The Government’s current approach to reimbursement, embedded in next year’s financial contract negotiations, will not solve the financial cliff edge and cash-flow issues many providers face. It is a damaging policy that will only exacerbate the existing financial crisis these sectors already face.

I will not dwell at length on the consequences of the national insurance increases as we have already explored them thoroughly. However, it is essential to reiterate the stark realities. The national insurance contribution increase imposes an immediate and substantial financial burden that will force some NHS dentists, community pharmacists, hospices, GPs and social care providers to make difficult choices, potentially reducing services and care packages, cutting staff, reducing access and indirectly impacting the most vulnerable in society. This will also add pressure on the NHS, as hospital beds will be blocked by keeping medically fit individuals in hospital because they cannot access appropriate social care packages.

The Government’s proposed solution—reimbursing these costs through next year’s contract negotiation—is fundamentally flawed. It amounts to a system of taking money away from those struggling organisations, with no guarantee of its full return. This will create significant cash-flow problems, particularly for those already operating on tight budgets. It could be the very issue that pushes some community pharmacists, social care providers and dentists over the edge, rendering them unable to continue to provide essential NHS services and care.

Furthermore, the NHS contracting cycle is notoriously complex. I know this as a former NHS manager. The reality is very different from being in a Whitehall office. It is complex and opaque. Contract negotiations bundle in various factors, including inflation and other cost pressures. There is no guarantee that the full amount of the national insurance increase will be reimbursed. Too often, initial drafts appear to include all necessary provisions, only for providers to discover mid-year that the additional activity requirements and other tricks that funders put in have effectively negated the promised increase.

Also, delays in finalising contracts are commonplace, leaving many sectors with months of accumulated pressures and unresolved cash-flow and debt issues. For example, community pharmacists are currently operating under a contract that ended in March last year. With only two weeks remaining in this financial year, a new agreement is still outstanding and they have not been reimbursed for the cost pressures of this financial year.

The uncertainty and delay create immense financial instability. The current system lacks the flexibility needed to address the immediate crisis that the national insurance increase will impose on some NHS and social care providers. A more agile and realistic approach is urgently required. Therefore, my amendment proposes that the Government can be granted the power to utilise a statutory instrument if necessary. This would allow for targeted and timely support to ensure that these vital services are not destabilised and pushed to the brink. The Government must abandon their rigid adherence to self-imposed rules and listen to the concerns raised about the impact of the national insurance increase. They must not continue marching forward blindly with this act of folly.

My amendment makes this offer to the Minister: give yourself some flexibility. Allow yourself to act quickly to reverse this damaging national insurance contribution rise for our health and social care systems. It would give the Government a way to get off the hook once they see how this increase will jeopardise community health, social care and other essential services. If the Minister will not listen, he will leave me no option but to test the opinion of the House. This is a generous offer. I urge him to accept my amendments. I beg to move.

[Lord Londesborough (CB)]

My Lords, it is with some regret that I do not insist on my Amendment 8 and its consequential amendments. I am disappointed that financial privilege has been invoked to prevent a full and proper debate in the other place on the potential damaging impact that reducing the class 2 secondary threshold by a brutal 45% will have on jobs and growth for small businesses and organisations employing fewer than 25 staff. I fear the Government will look back on 6 April, the day the new NICs regime kicks in, as a day of economic self-harm—a second April Fools’ Day, if you like.

I do propose to move Amendment 8B in lieu. In the spirit of pragmatism, my amendment, like that from the noble Lord, Lord Scriven, would simply bestow on the Treasury the power—through statutory instrument—to specify exemptions on the lowering of secondary class 1 thresholds for businesses, charities and, indeed, all organisations employing fewer than 25 people. We are talking about 10 million jobs across the UK that are not protected by Clause 3’s increase in the employment allowance, which offsets the NICs increases but, typically, only for those employing three or fewer staff. Given the potential damage to employment, wages and growth, why would the Government not want this weapon in their armoury in what will be a very difficult year ahead for small employers, who also face close to 7% increases in the national minimum wage and added compliance costs with the new Employment Rights Bill?

I support Amendments 1B and 5B in the name of the noble Lord, Lord Scriven, which strike me as an entirely sensible and pragmatic exemption tool to give to the Treasury given the very challenging circumstances facing care homes, hospices, pharmacies and other primary care providers.

Finally, I also support Amendment 21B in the name of the noble Baroness, Lady Neville-Rolfe, which seeks a review of the impact of NICs increases by sector. The impact note that came with the Bill was extraordinarily light on detail, especially when you consider that the Bill commits employers across these sectors to more than £5 billion per annum in additional NICs and impacts more than 10 million jobs.

I asked the Minister in Committee how many jobs in each sector would be impacted by the increase in NICs—a fairly basic question, one could argue, and yet no answer has been forthcoming. We heard on Report that such assessments would be

“econometrically impossible”.—[Official Report, 25/2/25; col. 1672.]

I respectfully disagree. We are asking for sectoral impact assessments that cover such key issues as the number of jobs impacted and the impact on vacancies, job creation, redundancies, labour activity and output, and wages. It was an entirely reasonable request and one the Treasury should readily embrace.

[Baroness Neville-Rolfe (Con)]

My Lords, the amendments in this group, including my Amendment 21B, address the very real negative impact of this jobs tax that the Government refuse to acknowledge. The Bill is the most important economic measure they have put forward so far and it makes significant changes to millions of businesses and social enterprises on a very short timescale. These businesses have raised concerns that are reflected in a flat-lining of growth, as worried owners seek to anticipate such a brutal change. Noble Lords from across the House have raised the consequences a number of times, yet the Government remain unreceptive.

At every stage of this Bill’s progression, we have raised the concerns of the healthcare sector about the effects on care homes, pharmacies, dentists, GP surgeries and hospices. It will have a real impact on people’s lives. I am particularly concerned about the hospice sector. The recent extra funding provided is capital funding and will not support day-to-day functions. Hospice UK has reported that the burden of the increase in employer NICs will be £44.3 million a year, which will not be covered by the £26 million of revenue funding for children and young people’s hospices, previously mentioned by the Minister. Last year, children’s hospices were provided with £25 million through the children and young people’s hospice grant. Can the Minister tell us how much of his £26 million is additional funding and how much is in fact recurring?

16:00

I am certain that there will be a number of hospices that are unable to absorb this cost. They will be left struggling, with more people dying in needless pain and anguish. As such, the amendment from the noble Lord, Lord Scriven—it is good to see him back in his place—is important to ensure that hospice care can be provided for anyone who needs it: the flexibility that he spoke of.

I also support the amendment on small businesses in the name of the noble Lord, Lord Londesborough, wholeheartedly. I cannot understand why the Government do not recognise the essential role that these entrepreneurial businesses play in supporting economic growth. I mentioned on Report the large number of small businesses that exist in the UK: a great strength. It is 5.5 million. This is an important group of people. The noble Lord’s well-judged amendment would allow the Treasury to protect them from this damaging measure if the need arose.

The Government have also rejected the calls from many of us to publish a full impact assessment, stating, as the Minister has done again today, that they had already published such an assessment. I would be grateful if the Minister could point me to those figures, because, as it stands, the impact note published on 13 November 2024 fails to mention a single one of the sectors in the review amendment. It does not refer a single time to charities with an annual revenue of less than £1 million, early years providers, hospices, the hospitality sector, pharmacies, small businesses, social care or transport for children with special educational needs or disabilities. Yet we know from multiple surveys by charities and business organisations about the negative impact of these changes on headcount and costs—and that is before they have even come into effect.

I am very disappointed by the way in which the Government have gone about this. Their reasoning is weak. Frankly, it is an affront to this House that they have failed to provide proper reasons, given that there is clearly no government impact assessment on any of these important sectors. It is something that has been discussed many times, and Peers from all Benches have agreed that the short note that the Government have provided is completely insufficient for effective scrutiny. This review will ensure that they do a better job in the run-up to future fiscal events. I hope my review amendment will secure the support of the House.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I rise very briefly to note that the Minister referred to the £22 billion black hole. On occasion when that occurs in these kinds of debates it does feel that the issue is being taken with a certain glib pinch of salt because we have heard that phrase so often. But, if I accept that there is a real problem, one of the things I have been absolutely convinced by the Government on is the need for economic growth to get out of this situation—which is why I cannot for the life of me work out how we have ended up in a situation where the Government are introducing measures that are going to damage growth so substantially. I agree with the Minister that we need to fill that £22 billion black hole, but, as has been argued across the House from a range of people, these measures are not going to do that: they are going to make that hole even deeper.

Therefore, I appeal to the Minister to stop digging himself ever deeper into this hole and at least accept that these amendments are modest and give the Government an opportunity to review whether the national insurance contribution increases will do the damage that is alleged. I have been inundated on this issue more than on any other since I have been in this House, by people working in social care, hospices, charities and small businesses.

Everybody is tearing their hair out and all they want is for the Government to listen. These very modest amendments simply call for the Government to have the capacity and flexibility to think again, in case those people worried about the increases are right. If the Government are right, they have nothing to worry about and I suggest they show a little humility over the concerns raised by a wide range of political voices in this House.

[Lord Weir of Ballyholme (DUP)]

My Lords, I too support the amendments in this group; I will speak briefly on them. Like many Members of your Lordships’ House, I share the general scepticism—indeed, hostility—towards the direction of travel of this legislation. Like others, I believe that, if the Government’s central mission is around economic growth as the stimulant, both with respect to the broader economy and from the point of view of public finances, this ultimately takes us very much in the wrong direction.

I appreciate, however, that that wider message is not what is before us today. The amendments before us are more nuanced and modest in their nature. They have been quite cleverly drafted by the noble Lord, Lord Scriven, and others, and are designed not to make a direct challenge to the financial authority of the House of Commons. It is disappointing that the Commons took that approach but, nevertheless, these are respectful and well-drafted amendments that try to deal with this issue. Specifically, the Minister mentioned that one of the key considerations and intentions of this Government is the reform and protection of public services. That stated aim, at least, is one that I think all of us in this House would share.

Central to that is the provision of support for the National Health Service, to ensure that the necessary reforms take place to save it from the crisis in which it has been left. While many pieces in that jigsaw will need to be fitted in, central to any chance we have of improving the National Health Service will be dealing with social care. The two are inextricably linked. In particular, we will need to turbocharge the provisions that can be made on social care and also—as is contained within the amendment—on a range of related topics, from dentistry to pharmacies, so that the pressure can be taken off the front-line services of the NHS, including hospitals.

It is critical, both from a health perspective and an economy perspective, that we ensure the swiftest possible turnarounds in hospital stays. Too many people in our society are bed-blocking. That is not a choice that they wish to make and it is detrimental to our health service, to those individuals and to the economy. Therefore, it strikes me that we should be looking to take all measures that can possibly improve social care and improve support for hospital provision.

It seems to me that the proposed national insurance changes would be deeply detrimental to those sectors. Indeed, we have had warning after warning from people in those sectors about the impact that it will have. Therefore, I believe that these modest amendments at least an attempt to redress that. In their wisdom, the Government will tell us that they believe the change will simply be beneficial; it will bring in additional revenue without in any way damaging the social care system. Perhaps the wisdom of the Government is greater than that of many of us in this House. Therefore, we are not seeking to impose our views but seeking a much more modest proposition, which simply says: let us keep this under review and let us have the opportunity for the Government—should they be proved wrong on this issue—to make a swift intervention. That seems eminently sensible.

Similarly, with the amendment on small businesses—they will be the fuel of our economy and in many ways critical aspects which will impact on growth—the opportunity is there not to challenge the tax rises directly but to ensure that intervention can take place.

On the final amendment, if we are making legislation, ultimately it should be evidence-based, and that means not simply at the time when we are making it. What is the direct impact? To have a range of reviews across a number of sectors to see whether intervention is then needed seems to be an eminently sensible approach.

I suspect that, in an ideal world, many of us would have liked the amendments before us today to have gone much further, but they seem modest and nuanced in their nature and an attempt at an olive branch to the opposition that came from the House of Commons, so I urge the Government to take a common-sense approach and adopt these amendments rather than forcing us into a Division on them.

[Lord Leigh of Hurley (Con)]

My Lords, I have spoken in all other stages of this Bill. I am grateful to the Minister for reminding us of the rationale for it, which is the alleged £22 billion black hole which no independent economist can find. The OBR can find £9 billion—

[Noble Lords]

Oh!

[Lord Leigh of Hurley (Con)]

No, no independent economist. I would be grateful if noble Lords opposite would stand up and identify an independent economist who agrees with the £22 billion black hole—I will take interventions anytime.

When they came into office, this Government were left with the United Kingdom having the fastest growth in the G7. What happened after that was the Chancellor came in and talked down the economy dramatically. Legislation came in against non-doms and, as a result, 10,000 non-doms—equivalent to 0.5 million taxpayers—left the country. The Employment Rights Bill is raising its ugly head, frightening people, and the IHT effect on BPR and APR has been dramatic. There is a poll out today by Family Business UK of 4,200 family companies, and they have all said they will be cutting back on recruitment. This is what is facing our economy. It led to the shrinkage in GDP in January and it has now led to the emergency Budget, none of which will be helped by these NI increases at all.

As my noble friend Lady Neville-Rolfe has said, we have had cries of anguish from the third sector. The CEO of Thames Hospice has said that people will die in greater pain and anguish as a result of the effect of the NI changes on employment in hospices. Will the Labour Party Members vote, with head high, in the Lobbies to support this? Will they do so in the Commons? This Government will be constantly reminded of the damage they are doing to the social care sector, to the hospices sector, and indeed, as the noble Lord, Lord Londesborough, said, to the small businesses sector. It is not too late. I hope noble Lords will think very carefully about how they vote this afternoon.

[Lord Cromwell (CB)]

My Lords, I will genuinely be brief. I agree with the spirit of the Government in rejecting carve-outs, no matter how emotionally appealing they may be. However, looking at these amendments, which I support, I do not understand why the Government are resistant to the Treasury having a practical route to act if there is a change of policy in due course. Otherwise, we are binding future Governments to have to produce new legislation to create carve-outs if they wish to do so. It seems to me rather obstinate not to accept these amendments, which give that flexibility without overturning the nature of the Bill and agreeing to carve-outs. So, I hope the Minister will either explain why the Government are unwilling or will accept these amendments.

16:15

[Baroness Noakes (Con)]

My Lords, I support all the amendments in lieu in this group, particularly Amendment 21B by my noble friend Lady Neville-Rolfe, asking for an ex post review of the impact on various sectors of this jobs tax. It is official government policy, confirmed by the leader in the other place, that Parliament will be given the information it needs to scrutinise legislation properly, but, shamefully, the Treasury refused point blank to give the information that we requested in order to scrutinise this Bill properly. My noble friend’s amendment is modest and reasonable, and if the Government do not accept it then that will show a complete lack of respect for Parliament and the process of parliamentary scrutiny.

I want to underline a point made by my noble friend Lady Neville-Rolfe about hospices. At the earlier stages of the Bill, the Minister kept repeating that the Government were putting £100 million into hospices and £26 million into children’s hospices. It is clear that neither of these amounts represents additional money available to absorb the cost pressures produced by the national insurance changes. My noble friend explained that, and I hope the Government will not try to pretend that the funding situation for hospices is anything other than completely dire at the moment.

[Lord Ashcombe (Con)]

My Lords, I would like to personalise this a little, because the hospice movement is unbelievably important in this country, and I am grateful to other noble Lords for raising the point again. I suppose that my family has been very fortunate, in unfortunate circumstances, to have the benefit of two hospices, both at end of life. Both hospices face significant shortfalls in their annual running costs and live off the back of occasional big legacies. They already have to raise substantial amounts of money, and the national insurance increase puts yet more pressure on the system. We have had the increase in minimum wages, which means that they have suffered those costs in addition; doctors and nurses do not come cheap, as we know. This just drives costs up further—for the hospice closest to home, the figure is nearly £0.5 million.

So what does the national insurance increase mean? In this particular case, it means either the loss of three nurses, who conduct some nearly 4,000 visits a year in the community, preventing the need for hospital care, or losing one bed, which would be dedicated to the most complex needs for patients at the end of their life.

If hospices are forced to reduce their care to the community, what happens next? They play such a critical role in supporting the NHS, which is not subject to the increase, both in terms of community care and in easing pressure on acute beds in hospitals, as well as facilitating discharges from hospital. If the Government continue to impose financial strain on the hospice sector, more hospices will be forced to scale back services or even close. That is something we cannot live with in this country, and it would place yet greater strain on the NHS—a particularly difficult sector, as we know, and one that we are trying not to pressure any further. When salary increases for medical staff and the rises in national insurance are factored in, this particular hospice will have to raise yet another £200,000 on top of the £0.5 million that I mentioned earlier, and that hospice is but one of 200 fantastic operations in this country.

I make again the point that various noble Lords have made: the recent announcement of the £100 million funding from His Majesty’s Government for the hospice movement and the £26 million for the children’s hospices is for capital projects, which, while very welcome, does not help this particular situation—a situation that the Prime Minister singularly seemed to ignore at PMQs last week. I beg the Government to reconsider their position.

[Baroness Monckton of Dallington Forest (Con)]

My Lords, I rise to speak in favour of these amendments and to speak very briefly about hospices—which I know many noble Lords have already done. Our hospices support over 300,000 people, mostly in the community, and this tax will cost the sector hundreds of thousands of pounds. Beds will close and outreach services will be decimated. Where will people go to die? Yes, hospitals offer palliative care, but only four out of 10 hospitals have the services that are necessary seven days a week, despite this having been a national standard in 2004.

The assisted suicide Bill is being debated in the other place. Assisted dying is what hospices do: ensuring that people can die in dignity, are properly cared for and can live as fully as they are capable of right to the end of their life. We only die once. I agree with what my noble friend Lord Leigh of Hurley has said previously: that not exempting hospices from this tax is shockingly cruel. But it is worse than that, because it shows a lack of compassion and an absence of humanity that are truly shocking. It leaves me speechless, and I have nothing more to say.

[Baroness Kramer (LD)]

My Lords, we on these Benches do not dispute that the Government were handed a dire fiscal situation; the question is what taxes they choose to raise to remedy it? We feel that they have made the wrong choice in this instance.

With these amendments in lieu—certainly those from my noble friend Lord Scriven and the noble Lord, Lord Londesborough, from the Cross Benches—we have proposed that, in key areas, power is provided to the Government and to the Treasury to reverse that decision in these narrow circumstances if they discover, as they see this event play out, that the choices they made were not those that they thought they had made. It is very unusual from these Benches for us to be willing to provide what is, in effect, a Henry VIII power to the Government, and that we do so reflects our deep anxiety. This is not political game playing; we are deeply anxious about what will happen with community health, social health, small businesses and the knock-on consequences of all that.

I want to thank the noble Baroness, Lady Noakes, because it was her thought in Committee that one way to at least find some common ground would be to pass powers over to the Secretary of State. That is the pattern that we have followed. I hope that the Government will see that they are not forced to act in any way by two of these amendments in lieu; they are being given the opportunity and the possibility, and we hope they will accept them in that spirit.

The noble Baroness, Lady Neville-Rolfe, has proposed an amendment in lieu which would require an impact evaluation. I have to say to the Minister that, when he spoke at the opening of this debate about how few businesses would be impacted by the increase in employer NICs, I began to think that he had not been given the central information that he should have been given. If he were to look, he would discover that that vast number of companies that are not affected are those with three employees or fewer, but that those small companies that we look to for scale-up and to drive growth are impacted.

Again, this underscores the fact that to roll it out effectively—and I fully accept that this is new and has not been the pattern of past Governments—we need to move to a time when we get much more detailed impact evaluation as we deal with these issues in this House. We on these Benches hope very much that the Government will accept the three amendments in lieu. If they do not, then we will support all three.

[Baroness Neville-Rolfe (Con)]

My Lords, we have worked together on these three modest, common-sense amendments, and we will also support them if it comes to a vote.

[Lord Livermore (Lab)]

My Lords, I am very grateful to all noble Lords who have taken part in this debate. As I have outlined, the measures contained in this Bill are necessary to repair the public finances, to rebuild public services, to protect working people and to invest in Britain. This includes an historic investment of an additional £25.7 billion for the NHS that is helping to bring down waiting lists more quickly and puts an end to over a decade of underinvestment and neglect. In doing so, the Government have kept their promise to working people to not increase their income tax, their national insurance or their VAT. We have always acknowledged that there are costs to responsibility, but the cost of irresponsibility would have been far greater.

The noble Baroness, Lady Neville-Rolfe, asked about the impact of the Bill on hospices. The Government of course recognise the vital role that hospices play in supporting people at the end of life and their families, and the cost pressures that the hospice sector has been facing over many years. That is why, as several noble Lords have mentioned, we are supporting the sector with a £100 million increase for adult and children’s hospices to ensure that they have the best physical environment for care, and £26 million revenue funding to support children’s and young people’s hospices. All charities, including hospices set up as charities, can also benefit from the employment allowance, which this Bill more than doubles from £5,000 to £10,500.

On assessments, as I have said previously, the Government and the OBR have already outlined the impacts of this policy change. This approach is in line with previous changes to national insurance and previous similar changes to taxation; the Government do not intend to provide further impact assessments.

The revenue raised from the measures in this Bill will play a critical role in repairing the public finances and rebuilding our public services. Any future changes which exempt certain groups would have cost implications, necessitating higher borrowing, lower spending or alternative revenue-raising measures. For these reasons and the other reasons that I have already set out, I respectfully ask noble Lords not to press their Motions containing Amendments 1B, 5B, 8B and 21B.

[Lord Scriven (LD)]

My Lords, I thank all noble Lords who have taken part in this informative and important debate. I support the Motions in the names of the noble Lord, Lord Londesborough, and the noble Baroness, Lady Neville-Rolfe.

It is a strange world we live in. I never thought that I would come to this House as a Liberal Democrat and argue for a Minister to have a Henry VIII power to try to help the Government with the consequences of a policy, and to have a Minister turn it down. No one is denying the right of the Government to raise revenue; what my amendment does is give the Government a tool to act swiftly on the consequences of what may, and probably will, happen in health and social care. It is not just pharmacists, GPs, hospices and dental practices that will suffer but people who require their services. Some of the most vulnerable will find that services stop because of the cash-flow and debt issues that the Bill will exacerbate in services that are already pressurised.

It is disappointing that when the olive branch is given, the Minister has decided to continue with the folly. Looking at the faces of some Members behind him, I think that they understand some of the potential consequences. It is disappointing that the Government and the Minister have not agreed to the olive branch. I therefore believe that it is right that I ask the House to agree to my Motion A1. I would like to test the opinion of the House.

16:28

Division 1

Ayes: 271

Noes: 173

16:39

Motion B

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 2, to which the Commons have disagreed for their Reason 2A.

2A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

[Lord Livermore (Lab)]

My Lords, in moving Motion B, I will speak also to Motions C, D, F, G and J to V. The other place has disagreed to Amendments 2, 3, 4, 6 and 7 and Amendments 9 to 20, as they interfere with public revenue. The other place did not offer any further reason, trusting that this reason is sufficient. On that basis, I hope that noble Lords are content not to insist on Amendments 2, 3, 4, 6, 7 and 9 to 20. I beg to move.

[Baroness Neville-Rolfe (Con)]

My Lords, the Government have rejected a number of amendments which call for the exemption of various sectors from the jobs tax, citing financial privilege. The amendments would have protected small business, providers of transport for students with special educational needs, small charities, providers of early years education and hospices, which we have already heard a lot about today, because of their desperate situation, from my noble friends Lord Leigh, Lord Ashcombe, Lady Monckton and Lady Noakes.

The Government’s refusal to acknowledge the damaging impacts that this tax on jobs will have is very concerning. The tax is in complete contrast to their insistence that they are the party of growth. Indeed, the most recent GDP statistics from the ONS indicate that the economy shrank by 0.1% in January. The way the Government are now taxing the more productive private sector to pay for a huge increase in less productive public projects and salaries means, I fear, that this trend will continue.

We have recast our review clause into a modest one, which we will be voting on shortly. We will not oppose the government amendments in this second group, but I give notice that we are planning to seek assistance for those providing SEND transport in the Bus Services (No. 2) Bill.

[Baroness Kramer (LD)]

My Lords, briefly, we regret very much that the other place rejected amendments that would have exempted key groups such as universities, nurseries and those providing SEND transport—essential services that provide key support will be under huge financial pressure. We have had to be selective. We have offered the Government opportunities to take powers in the areas where we think the greatest damage will be done most rapidly. Therefore, we will not press the Government on these amendments.

[Lord Livermore (Lab)]

My Lords, I am very grateful to the noble Baronesses, Lady Neville-Rolfe and Lady Kramer, for their agreement not to insist on these amendments. We have had to take difficult but necessary decisions to repair the public finances and rebuild our public services. Not acting was simply not an option. As a result, through this decision, and others taken in the Budget, we have created a foundation of stability on which we are now taking forward our agenda of growth and reform.

Motion B agreed.

Motion C

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 3, to which the Commons have disagreed for their Reason 3A.

3A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion D

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 4, to which the Commons have disagreed for their Reason 4A.

4A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motions C and D agreed.

Motion E

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 5, to which the Commons have disagreed for their Reason 5A.

5A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

[Lord Livermore (Lab)]

My Lords, I beg to move.

Motion E1 (as an amendment to Motion E)

Moved by

[Lord Scriven]

At end insert “, and do propose Amendment 5B in lieu—

5B: After Clause 2, insert the following new Clause—
“Exemptions from the changes made by section 2: NHS and social care
(1) The Treasury may by regulations made by statutory instrument specify that certain categories of persons are exempted from the changes to the thresholds for secondary Class 1 contributions made by section 2 of this Act.
(2) The categories of persons any of whom may be specified under subsection (1) are—
(a) a person providing a care home service or a domiciliary support service who is regulated under—
(i) Part 1 of the Health and Social Care Act 2008, or
(ii) Part 1 of the Regulation and Inspection of Social Care (Wales) Act 2016;
26(b) a person providing a service who is regulated under section 47(1)(a) or (b) of the Public Services Reform (Scotland) Act 2010;
(c) a person providing a care home service or domiciliary support service regulated under the Health and Personal Social Services (Quality, Improvement and Regulation) (Northern Ireland) Order 2003;
(d) a person contracted to provide primary care under the provisions of—
(i) Part 4 of the National Health Service Act 2006,
(ii) Part 4 of the National Health Service (Wales) Act 2006, or
(iii) sections 17J to 17O of the National Health Service (Scotland) Act 1978;
(e) a person providing primary medical services through contractual arrangements with a Health and Social Services Board;
(f) a person contracted to provide general dental services under the provisions of Part 2 of the National Health Service (General Dental Services) Regulations 1992;
(g) a person providing general dental services under Part 2 of the General Dental Services (Northern Ireland) Regulations 1993;
(h) a person contracted to provide pharmacy services under the provisions of—
(i) Part 7 of the National Health Service Act 2006, or
(ii) Part 8 of the NHS (Pharmaceutical and Local Pharmaceutical Services) Regulations 2013;
(i) a person providing pharmaceutical services under Part 2 of the Pharmaceutical Services Regulations (Northern Ireland) 1997;
(j) a charitable provider of health and care;
(k) a provider of health and care registered as a charity by the Charity Commission for Northern Ireland;
(l) a person providing hospice care whether in a hospice or elsewhere;
(m) a carer to whom section 2(3A) of the National Insurance Contributions Act 2014 applies.
(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.””

[Lord Scriven (LD)]

My Lords, I beg to move my amendment.

Motion E1 (as an amendment to Motion E) agreed.

Motion F

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 6, to which the Commons have disagreed for their Reason 6A.

6A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion G

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 7, to which the Commons have disagreed for their Reason 7A.

7A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motions F and G agreed.

Motion H

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 8, to which the Commons have disagreed for their Reason 8A.

8A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

[Lord Livermore (Lab)]

My Lords, I beg to move.

Motion H1 (as an amendment to Motion H)

Moved by

[Lord Londesborough]

At end insert “, and do propose Amendment 8B in lieu—

8B: Clause 2, page 1, line 15, at end insert—
“(3A) The Treasury may by regulations made by statutory instrument specify that businesses or organisations with fewer than 25 full-time employees are exempted from the changes to secondary Class 1 thresholds made by this section.
(3B) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.””

[Lord Londesborough (CB)]

My Lords, I beg to move Motion H1 and wish to test the opinion of the House.

16:45

Division 2

Ayes: 276

Noes: 165

16:57

Motion J

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 9, to which the Commons have disagreed for their Reason 9A.

9A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion K

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 10, to which the Commons have disagreed for their Reason 10A.

10A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion L

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 11, to which the Commons have disagreed for their Reason 11A.

11A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion M

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 12, to which the Commons have disagreed for their Reason 12A.

12A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion N

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 13, to which the Commons have disagreed for their Reason 13A.

13A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion P

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 14, to which the Commons have disagreed for their Reason 14A.

14A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion Q

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 15, to which the Commons have disagreed for their Reason 15A.

15A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion R

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 16, to which the Commons have disagreed for their Reason 16A.

16A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion S

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 17, to which the Commons have disagreed for their Reason 17A.

17A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion T

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 18, to which the Commons have disagreed for their Reason 18A.

18A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion U

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 19, to which the Commons have disagreed for their Reason 19A.

19A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motion V

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 20, to which the Commons have disagreed for their Reason 20A.

20A: Because the Lords Amendment interferes with the public revenue, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.

Motions J to V agreed.

Motion W

Moved by

[Lord Livermore]

That this House do not insist on its Amendment 21, to which the Commons have disagreed for their Reason 21A.

21A: Because information has already been published about these matters and a further review is not necessary.

[Lord Livermore (Lab)]

My Lords, I have already spoken to Motion W. I beg to move.

Motion W1 (as an amendment to Motion W)

Moved by

[Baroness Neville-Rolfe]

At end insert “, and do propose Amendment 21B in lieu—

21B: After Clause 3, insert the following new Clause—
“Review of effect on certain sectors
(1) The Chancellor of the Exchequer must, within six months of the day on which this Act is passed, lay before Parliament a review of the impact of the measures contained in this Act on the persons and sectors in subsection (2).
(2) The review must consider the impact on—
(a) charities with annual revenue of less than £1 million;
(b) early years providers;
(c) hospices;
(d) the hospitality sector;
(e) pharmacies;
(f) small businesses;
(g) social care;
(h) transport for children with special educational needs or disabilities.””

[Baroness Neville-Rolfe (Con)]

My Lords, I beg to move Motion W1 and to test the opinion of the House.

16:58

Division 3

Ayes: 273

Noes: 172

Conflict in Gaza

Monday 24th March 2025 Lords Chamber

Statement

The following Statement was made in the House of Commons on Thursday 20 March.

“With the permission of the House, I shall make a Statement about the conflict in Gaza. In January, I outlined to the House the deal agreed between Israel and Hamas. It was a moment of huge hope and relief. In the weeks that followed, hostages cruelly detained by Hamas were reunited with their families, and aid blocked by Israel finally flooded into Gaza. A path out of this horrendous conflict appeared open. It is therefore a matter of deep regret that I have to update the House today on a breakdown of the ceasefire and yet more bloodshed in Gaza.

On the night of 18 March, Israel launched air strikes across Gaza. A number of Hamas figures were reportedly killed, but it has been reported that over 400 Palestinians were killed in missile strikes and artillery barrages. The majority of them were women and children. This appears to have been the deadliest single day for Palestinians since the war began. This is an appalling loss of life, and we mourn the loss of every civilian.

Yesterday morning, a UN compound in Gaza was hit. I can confirm to the House that a British national was among the wounded. Our priority is supporting them and their family at this time. Gaza has been the most dangerous place in the world to be an aid worker, and I share the outrage of the UN Secretary-General Guterres at this incident. The Government call for a transparent investigation, and for those responsible to be held to account.

The UK is working closely with partners, such as France and Germany, to send a clear message. We strongly oppose Israel’s resumption of hostilities. We urgently want to see a return to a ceasefire. More bloodshed is in no one’s interest. Hamas must release all the hostages, and negotiations must resume. Diplomacy is the one way to achieve security for both Israelis and Palestinians. The House will know that the ceasefire in Gaza had lasted for almost two months—the result of dogged efforts by Egypt, Qatar and the United States. The deal reached in January saw the nightmare of captivity for 30 hostages end, and the bodies of eight further victims of Hamas returned to their loved ones. We all remember the joy of seeing Emily Damari reunited with her mother and family. Desperately needed aid began to flow back into Gaza—food, medicines, fuel and tents. Children in Gaza had respite from relentless fear. The severely injured could cross the border again for treatment. Palestinians had begun to return to their homes, and to consider how to rebuild their lives.

In the first days of the ceasefire, the UK moved swiftly to invest in the peace. We released £17 million in additional emergency humanitarian funding for the promised surge in aid. We brought our total support this year for Palestinians across the region to £129 million. We accelerated work on the pathway to reconstruction, supporting our Arab partners’ very welcome recent initiative. We worked at every level to support negotiations for a permanent ceasefire and the return of every single hostage in a backed extension to phase 1 of the current deal.

But negotiations have been gridlocked for several weeks. Hamas has been resisting calls for the release of further hostages in return for a longer truce. Israeli forces did not begin to withdraw from the Philadelphi corridor as agreed, and on 2 March, the Israeli Government announced that they were blocking all further aid deliveries until Hamas agreed to their terms. For weeks now, supplies of basic goods and electricity have been blocked, leaving over half a million civilians once again cut off from clean drinking water and sparking a 200% surge in the price of some basic foodstuffs—a boon to those criminals who use violence to control supplies.

As I told the House on Monday, this is appalling and unacceptable. Ultimately, of course, these are matters for the courts, not Governments, to determine, but it is difficult to see how denying humanitarian assistance to a civilian population can be compatible with international humanitarian law. Although it is important to say that I could have been a little clearer in the House on Monday, our position remains that Israel’s actions in Gaza are a clear risk of breaching international humanitarian law.

The consequences of the ceasefire’s breakdown are catastrophic. For the families and friends of the remaining 59 hostages, including Avinatan Or, the agony goes on. Hamas’s kidnapping of those people and treatment of them in captivity, the cruel theatre of their release, depriving them of food and basic rights—those are acts of despicable cruelty. Hamas must release them all now.

Palestinian civilians, who have already endured so much, now must fear a re-run and a return to days of death, deprivation and destruction. Civilians have once again been issued with evacuation orders by Israel. Only 4% of the United Nations flash appeal is funded—not even enough to get through to the end of this month. Health centres have had to close, even as the devastated Gazan health service has to treat another surge of those wounded in strikes.

Hamas can have no role in Gaza’s future, but a collapsed ceasefire will not bring the hostages home to their families, an endless conflict will not bring long-term security to Israel, and a deepening war will only set back the course of regional normalisation and risk further instability, shortly after the Houthis resumed their unacceptable threats to shipping in the Red Sea.

Since the renewed outbreak of hostilities, I have spoken to Secretary Rubio, to EU High Representative Kallas and to UN emergency co-ordinator Tom Fletcher, and I will shortly speak to my Israeli counterpart Gideon Sa’ar and Palestinian Prime Minister Mustafa. We and our partners need to persuade the parties that this conflict cannot be resolved by military means. We want Israel and Hamas to re-engage with negotiations. We continue to condemn Hamas, of course, for its actions on 7 October, its refusal to release the hostages, and its ongoing threat to Israel, but we are also resolute in calling on Israel to abide by international law, lift the unacceptable restrictions on aid and demand the protection of civilians.

Many months ago, only weeks into office, I concluded that there was a clear risk of Israel breaching international humanitarian law in Gaza. It was that risk, which I first set out in the House back in September, that meant that the Government suspended relevant export licences for items for use by the Israel Defense Forces in military operations in Gaza. The actions of last week only reinforced that conclusion. In the days and weeks ahead, we will redouble our efforts to restore a ceasefire, but we will also continue to work with our partners on the security, governance and reconstruction arrangements. Those issues are not going away. There remains no military solution to this conflict. A two-state solution remains the only path to a just and lasting peace.

At this Dispatch Box in January, I called the ceasefire deal

‘a glimmer of light in the darkness’.—[Official Report, Commons, 16/1/25; col. 511.]

It feels like the darkness has returned. Former British hostage Emily Damari said that the resumption of fighting left her heartbroken, crushed and disappointed. I am sure that she speaks for the whole House. But we must preserve hope for the sake of the remaining hostages and their loved ones, for the people of Gaza, and for the future of two peoples who have suffered so much for so long. We will keep striving for a return to the path to peace. I commend the Statement to the House”.

17:09

[Lord Callanan (Con)]

My Lords, I am sure that Members across both Houses mourn the many innocent lives lost to date in this appalling conflict. I know that colleagues on all sides of your Lordships’ House will join me in sending our sympathies and thoughts to all those who have been affected, including the British national injured in last week’s air strikes.

In his Statement in the other place last week, the Foreign Secretary confirmed that he was in the process of making representations to the Israeli Government to find out more about the investigations they were undertaking into the recent air strikes that were undertaken against targets in Gaza. Could the Minister provide an update to the House on the outcome of those talks and any information the Foreign Secretary has received from his Israeli counterparts?

This conflict has seen death, destruction and human suffering across a large area of the Middle East. Many lives have been irrevocably changed, and futures are uncertain for many thousands of people. We must never forget that the fault for this tragic situation lies squarely with Hamas—a murderous, viscerally antisemitic terrorist organisation. It kidnapped children, raped and mutilated women and girls, and massacred young people who were simply enjoying a music festival. According to Israeli news reports, Hamas has now fired over 4,300 rockets at civilian targets and inflicted the single deadliest anti-Jewish pogrom since the Holocaust. Hamas has deliberately entrenched itself in civilian communities to bring innocent people into the line of fire in the war that it has itself created, and it has acted in a way designed and intended to bring about the maximum amount of suffering for civilians across the region.

The power to end this conflict lies with Hamas. It could agree to release the people it has imprisoned as hostages now and avert any further escalation in this conflict. I therefore ask the Minister: what are the Government doing to support efforts to secure the release of the hostages? Do the Government believe that phase 2 of the ceasefire remains within reach or are alternative solutions being considered? What are the Government doing to make sure that Hamas will never have a role in Gaza’s future?

The UK’s relationship with Israel is vital to ensure that we can support those affected by this terrible conflict and the only way that we can play a role in bringing it to an end. Israel must continue to see the UK as a trusted partner if we are to continue to play a role not only in bringing about an end to this war but in supporting peace and stability across the entire Middle East. I therefore ask the Minister what the Government are doing to strengthen this relationship. Have the comments made by the Foreign Secretary last week, which I am pleased to say he has now withdrawn, affected the trust between our two nations?

Finally, ensuring that aid gets to those communities affected by this conflict is one of the most important roles we can play amid the suffering that is taking place. Thousands of innocent people are suffering and we must do all we can to make sure that food and medicine get to those who need it. I close by asking the Minister what discussions the Government have held with the Israeli Government on the question of getting aid routes unblocked. What has happened to British aid that is already present in the region or en route? Furthermore, what assessment have the Government made of how we can better support the affected communities? What more could we be doing to support the vital work of the International Committee of the Red Cross?

[Lord Purvis of Tweed (LD)]

My Lords, the ferocity of the return to war has shocked many. Even in the days since the Statement was made in the House of Commons, we have seen strikes within Lebanese territory as well. Can the Minister update us on the contact His Majesty’s Government have had with the Lebanese Government regarding to the situation in Lebanon? I have twice asked the Development Minister, the noble Baroness, Lady Chapman, whether she would be open to meeting with me and female Lebanese MPs who are at the heart of trying to design reconstruction that does not entrench the confessional system but offers new hope.

But, alas, with the strikes in Lebanon, that hope, as well as that with regard to the hostage families, must now be teetering. Indeed, reading, as I did—I quoted it in the Chamber—the statement from the hostage families of their shock and anger at the Netanyahu Government’s resumption of war was really depressing, because it dashes what many have had: finally, the prospect of hope. So can the Minister update us on the Government’s assessment of the process that was brokered by Qatar? Is it a process that the Government consider can still be retrieved or do the actions we are seeing within Gaza and Lebanon now require a separate process? What discussions have the Government had with our Qatari and Egyptian colleagues?

It should be noted that the restart of the war has seen an even higher proportion of victims being women and children than before the ceasefire. The availability of food and medicine is even less than it was then. Yet again, civilians are being treated disproportionately and are also being forcibly moved to new areas where there is no food, shelter, water or medicine. That qualifies as a war crime. I asked the Minister last week whether it was the Government’s view that there is a prima facie case of international human humanitarian law being breached. What actions are we taking beyond those taken last July with the limited suspension of certain export licences?

I turn to the Arab peace plan and the Government’s assessment of the overall prospects for reconstruction if there is some form of peace—even though not many people will be optimistic about that. What faith can we put in the judgment of the United States envoy, Steve Witkoff, who the Foreign Secretary said in his Statement we were speaking to but who in recent days has ridiculed our Prime Minister as a poseur and posturer over Ukraine, regards the war criminal Putin not as a war criminal or a bad guy but as a gracious and good guy, and has said that Ukraine is “a false country”? If that is the envoy’s judgment on Ukraine, what faith can we have in his judgment on the reconstruction of Gaza? What is our position on the Arab plan? Is it one that the United Kingdom is supporting directly or are we sympathetic to what the Trump Administration have been saying?

We have also, regrettably, seen certain extremist elements of Israeli politics rejoin the Netanyahu Administration. This is of concern not just to people in this Parliament but to civil society in Israel itself. We have seen the attacks on the judiciary, the statements for annexation of parts of the Occupied Palestinian Territories, the unprecedented sacking of the internal intelligence chief and the active encouragement of settler violence. Most surely, we cannot have a relationship with the Netanyahu Administration in the normal manner. So, what actions are the UK taking to prevent settler violence and annexation? What are our red lines for our diplomatic relations with the Netanyahu Administration?

Finally, one of the issues that must now be an imperative is recognition, because, even at a time of great humanitarian danger, there is one element we can provide: hope for statehood. We had a very good debate—and all Members were able to express their views, in favour and against—on the recognition Bill brought by my noble friend Lady Northover. I understand that it is the Government’s position that now is not the time for recognition and that they will make a judgment on when it is the appropriate time for recognition. What factors would need to be in place that are not in place now for us to consider that the time would be right? At the end of the day, with the danger that the civilians are seeing, one of the elements that can provide hope is recognition. These Benches believe in this, and I hope the Government can at least move and give more hope to the Palestinian people.

[The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Lord Collins of Highbury) (Lab)]

I thank both noble Lords for their contributions, comments and questions. We all share deep concern about the resumption of Israeli military action in Gaza, and the United Kingdom does not support a return to fighting. It is absolutely not in anybody’s interests and, certainly, the reported civilian casualties resulting from the renewed outbreak of hostilities are appalling. We are absolutely focused on ensuring that aid must immediately be allowed back into Gaza. We have urged all parties to return urgently to talks, implement the ceasefire agreement in full, release the hostages and work towards a permanent peace and security for Israelis and Palestinians. That is absolutely the key.

Picking up on the point from the noble Lord, Lord Purvis, about when the right time for recognition is, the right time is when we see a clear pathway to a negotiated settlement. That is what the former Foreign Secretary, the noble Lord, Lord Cameron, said. It is what we have repeatedly said. It should be an aid towards securing a proper process for achieving a longer-term settlement that sees security for Israel and nationhood for the Palestinians, and them working peacefully together.

I say to the noble Lord, Lord Callanan, that the Foreign Secretary has been absolutely embraced in terms of communicating our concerns and how we could reach, in particular, access for aid into Gaza. The Foreign Secretary has recently spoken to Secretary Rubio, EU High Representative Kallas and the UN emergency relief co-ordinator, Tom Fletcher. On 21 March, he also spoke to his Israeli counterpart, Gideon Sa’ar, and he plans to speak to Palestinian PM Mustafa shortly. The UK made statements in the UN Security Council on Tuesday 18 March and Friday 21 March. We joined the G7 Foreign Ministers’ statement the week before. An E3 Foreign Ministers’ statement issued on Friday 21 March called on all parties to re-engage with negotiations to ensure that the ceasefire is implemented in full and becomes permanent.

In his Statement last Thursday, the Foreign Secretary said that the block on supplies of basic goods and electricity was appalling and unacceptable. He went on to say that, while ultimately this is a matter for the courts, not Governments, to determine, it was difficult to see how denying humanitarian assistance to a civilian population could be compatible with international humanitarian law. The Government have been clear that we are not an international court and that we cannot make a judgment on whether Israel has breached IHL.

Our export licensing criteria, as the Foreign Secretary set out in the House of Commons back in September, require him to assess the risk that our exports could commit or facilitate serious violations of international humanitarian law. Our reviews concluded that there was a clear risk of Israel breaching IHL and we took decisive action on 2 September by suspending the relevant licences to the IDF for use in Gaza.

We have been absolutely clear that humanitarian aid should never be used as a political tool and that Israel must restart the flow of aid immediately. The Prime Minister and the Foreign Secretary have made it clear that they are appalled by Israel blocking aid when it is needed at greater volume and speed than ever before. At the UN Security Council meeting on 18 March, we called for a rapid and unhindered resurgence of the flow of aid into Gaza and for the ceasefire to be re-established as soon as possible. The Foreign Secretary spoke to Tom Fletcher on 14 March regarding the humanitarian situation in Gaza and Hamish Falconer spoke to him on 17 March, so we have been in constant contact.

In relation to the UNOPS compound in Gaza, which was hit last week, our thoughts are very much with the victims and their families, including, as noble Lords have said, a British national. On 21 March, together with France and Germany, we called for an investigation into this incident. UN personnel and premises should be protected and never be a target. We are, of course, aware of the statement and we echo the UN Secretary-General’s call for an urgent ceasefire. As the Foreign Secretary said on Thursday, this was a shocking incident, with a British national being wounded. We share the outrage of Secretary-General Guterres at this incident. The Government call for a transparent investigation and for those responsible to be held to account.

As the noble Lord, Lord Callanan, reflected, the hostages have endured unimaginable suffering and the situation in Gaza has worsened. This ceasefire is the only way for the region to move forward. Securing an immediate ceasefire and the safe release of all hostages has been a priority for this Government since the start of the conflict and we will not stop until they are all home. Time is running out and we renew the call of all parties to return to dialogue.

I stress that there is no moral equivalence between Israel, a democracy, and Hamas, a proscribed terrorist organisation. We have been clear that there is no role for Hamas in the future governance of Gaza.

In relation to the comments of the noble Lord, Lord Purvis, we welcome the Arab initiative on the recovery and reconstruction plan for Gaza. In a statement on 8 March, we, with France, Germany and Italy, encouraged ongoing efforts on the initiative and encouraged all parties to build on the plan’s merits.

In relation to the hostages, on 20 March, the UK-linked former hostage Eli Sharabi addressed an open session of the Security Council, which was called for by the UK, along with the US and France. Following Eli’s harrowing testimony, the UK said that Hamas must be held accountable for its despicable actions. We have repeated our call for the immediate and unconditional release of all hostages, which has also been set out in all four of the UN Security Council’s resolutions on Gaza adopted since 7 October.

The important thing is how we can ensure that the focus continues to be on the ceasefire and the agreed process. As regards the comment from the noble Lord, Lord Purvis, we are committed to that. We do believe that it is our only hope for sustainable peace and we will work at all levels to ensure that it can be delivered.

In relation to Lebanon, escalation across the Israel-Lebanon blue line is deeply concerning. It is imperative that all sides return to a cessation of hostilities and work towards a secure and lasting peace. That is the only way to restore security and stability for people living on either side of the border.

17:28

[Lord Ahmad of Wimbledon (Con)]

My Lords, I draw attention to my entry in the register of interests, including chairing the ICO advisory panel on conflict resolution. I have interrelated questions. There is a conference scheduled for June by France and the Kingdom of Saudi Arabia. I would appreciate the Minister’s insights as to the UK’s role. Linked to that, on the specific dates of meetings and engagement that have taken place with Steve Witkoff, the US envoy, clearly, the United States, together with Qatar, has the greatest leverage when it comes to dealing with Hamas. What specific role is the United Kingdom playing in engaging with these two key partners?

[Lord Collins of Highbury (Lab)]

The Minister for the Middle East has been in regular contact with neighbouring countries and regional allies. We are absolutely focused on that. To repeat what I have said on numerous occasions, we welcome the United States’ action in securing the ceasefire agreement and the release of the hostages that we have seen so far. We remain committed to speaking with allies to look at all possibilities, so that we can remain focused on the ceasefire to ensure a much longer-lasting peace. The noble Lord is right: we must work with our allies to ensure that they understand the importance of this, and particularly all regional neighbours.

[Lord Polak (Con)]

My Lords, I refer the House to my registered interests. Last Thursday, in New York, I had a humbling experience at the UN Security Council, to which the Minister has just referred, where I heard the brave, eloquent and moving speech of the freed hostage Eli Sharabi, whose British wife, Lianne, and daughters, Noiya and Yahel, were brutally murdered. I urge all noble Lords to read his speech. Many noble Lords have already spoken about aid to Gaza. I will quote a short extract from Eli Sharabi’s speech:

“I saw Hamas … carrying boxes with UN and UNRWA emblems … into the tunnel. Dozens and dozens of boxes paid by your governments. Feeding terrorists who tortured me and murdered my family. They would eat many meals a day from UN aid in front of us and we never received any of it”.


In the light of Eli’s remarks, I want to ask the Minister a question that the shadow Foreign Secretary asked the Foreign Secretary last week. What is HMG’s assessment of reports of Hamas stockpiling aid?

[Lord Collins of Highbury (Lab)]

I repeat that Eli Sharabi’s statement was incredibly moving and had a huge impact on all members of the Security Council. Our Statement afterwards was clear that Hamas must be held accountable for its despicable actions, and we certainly reflected that in all of the UN Security Council’s resolutions. The problem is that aid is not getting in at all at the moment. That has to be the focus of our attention. We are looking at all ways to ensure that aid gets in, not only through UNRWA, which is an important agency in the delivery of aid, but, as the noble Lord raised, through the ICRC. We are absolutely focused on ensuring that. The real problem at the moment is the fact that we cannot get aid across the border into Gaza. That is the shocking situation that we need to focus on.

[The Lord Bishop of Manchester]

I am very grateful for the Statement that was brought to this House today. From these Benches, I echo the comments that noble Lords have made about the fact that Hamas must have no part in any future government of the Palestinian territories or any future Palestinian state. Every time the situation in Gaza has become more warlike, under the fog of that war there have been atrocities committed in the West Bank. Some of the more extreme settler movements are trying to oust Palestinian farming families from territories that everybody accepts are theirs by right. What can His Majesty’s Government do to ensure that we do not lose sight of the West Bank at this time when, quite rightly, there is a proper focus on Gaza?

[Lord Collins of Highbury (Lab)]

The right reverend Prelate is right to draw attention to that. We have been extremely concerned about the increased level of settler violence—I prefer to call it outpost violence. We have made it clear, and the previous Government made it clear, that Israeli settlements are illegal under international law and harm prospects for a two-state solution. The Foreign Secretary met Palestinian community members in the West Bank and heard how communities are affected. He has been clear with Israeli Ministers that the Israeli Government must clamp down on settler violence and end settler expansion. We also took action in relation to sanctions. We need to highlight this issue and not forget that the West Bank is an important part of ensuring long-term stability in the region.

[Lord Pickles (Con)]

My Lords, I draw attention to my entry in the register of interests. I recently returned from a visit to Israel. The Minister is quite right to say that aid should not be used for a political purpose, and he is quite right to concentrate on resuming aid going in. But the question my noble friend raised on the deliberate stealing of aid by Hamas and the use of that aid to buy ammunition, to sell it on the black market, and to ensure that Hamas continues to control a significant part of Gaza is important. We can have lasting peace only if one side is not dedicated to the utter destruction of the other. We know through the report issued by my noble friend Lord Roberts last week exactly what we are up against, so it is not unreasonable to say that when the aid goes back in, it cannot be business as normal.

[Lord Collins of Highbury (Lab)]

The noble Lord is absolutely right. I have made it clear how the United Kingdom Government view the actions of Hamas. It is a terrorist organisation which has committed atrocious crimes that it must be held accountable for. I hear what the noble Lord says in relation to aid, but we are not getting aid in at all at the moment. We want to use all agencies. Certainly, the noble Lord, Lord Ahmad, when he was responding on these questions, understood the importance of ensuring that there were facilities to get aid to those people most in need. We will continue to take every measure possible to ensure that is the case. So, I hear the noble Lord, but our priority is to get support to the most vulnerable and those most in need.

[Lord Verdirame (Non-Afl)]

My Lords, as the Minister recalled, a few months ago the Government published an assessment where they concluded that there was a clear risk of breaches of IHL by Israel. The clear risk in the Government’s published assessment was in relation to the provision of humanitarian assistance. The Statement of last week says that the Government feel that this conclusion has been reinforced by the actions of the last three weeks, and that conclusion was obviously the basis for the decision to suspend the arms licences. Can the Government tell us a bit more about the nexus between the British weapons and the alleged or suspected breaches of IHL? In other words, which British weapons did the Government consider could be used to commit which breaches?

[Lord Collins of Highbury (Lab)]

I tried to make that clear in response to the Front-Bench questions. Our export licensing criteria, as the Foreign Secretary set out to the House of Commons in September, require him to assess the risk that our exports could commit or facilitate serious violations of IHL. Our reviews concluded that there was a clear risk of Israel breaching IHL, hence the action we took on 2 September, suspending relevant licences to the IDF for use in Gaza. That was the position and it remains so.

[Baroness Foster of Oxton (Con)]

My Lords, I have two points I wish to seek clarification on. I understand there is a very difficult issue in terms of aid crossing through from the Egyptian border, notwithstanding that the drivers then refused to continue delivering aid because they were being attacked by Hamas operatives and gangs in Gaza. The second point is one I raised some weeks ago here, when the Government had decided to provide UNRWA with aid again to the tune of something like £48 million of British taxpayers’ money. My question at the time was: how are the Government going to provide oversight to ensure that the money being spent—not only from UK taxpayers, but it is the UK that we are concerned about here—is going in the right direction? I have not had a response about how the Government will provide that oversight, so I would be grateful if the Minister could share that information with us now in the House?

[Lord Collins of Highbury (Lab)]

The important thing to consider is how we are working with all agencies, including the UN and NGOs such as the International Committee of the Red Cross, and what we achieve through clear monitoring and assessment of that aid.

The situation in Gaza is appalling and we know there is a desperate need for support. We have made a very clear ask: we said that Israel must work with the United Nations and all partners to ensure that the supply of humanitarian assistance to Gaza continues in all circumstances. The enhanced levels of relief supplies getting into Gaza prior to Israel’s current block on aid must be resumed. Aid must get to those who need it across all areas of Gaza, and that includes providing access to essential civilian services.

We are pleased to hear that the latest polio vaccination rollout reached 99% of children targeted, but we remain gravely concerned by the lack of adequate medical care in Gaza. More types of goods must be allowed in, such as tents, medical equipment and machinery, to support the resumption of basic services in Gaza. I do not think anyone in their right mind would believe that the situation is at all tolerable; it is intolerable, and we need to act.

[Baroness Goudie (Lab)]

My Lords, when the Foreign Secretary saw groups recently, did he see women’s peace groups? In terms of aid, what is being done for maternal health, which is desperate in Gaza, and to get help for children, who have been damaged so badly, and for babies who have been born without any support at all because there are no hospitals?

[Lord Collins of Highbury (Lab)]

My noble friend is right. In previous Statements, I have made clear that we are focused on educational support and on women and girls. I took the opportunity in New York at the Commission on the Status of Women to focus on how, in all the peace processes, we can ensure that the women, peace and security strategy is fully adopted. It is vital that we recognise the urgent situation, particularly its impact on women and girls, and particularly on pregnant women, so my noble friend is absolutely right.

[Lord Kerr of Kinlochard (CB)]

Could the Minister address the question raised by the noble Lord, Lord Purvis? Do we believe that the ceasefire is saveable? It looks dead; is it dead? Can it be resurrected? As I understand it, it was a three-stage ceasefire. The Government of Israel decided not to move to the second stage on the agreed timetable, Hamas having turned down their alternative suggestion of elongating stage 1. That looks to me like a battlefield for a diplomatic negotiation. What are we saying to the Qataris? Do they think the ceasefire can be saved? Do we think it can be saved? Are we suggesting to them ways of saving it?

[Lord Collins of Highbury (Lab)]

The straight answer to the noble Lord is that we believe it can be saved because we believe it is there to be implemented, which is why we are making every effort to call on all parties to resume the negotiations. I am not going to be hung up on each stage and the timing of that. We have a clear commitment and undertakings that were given. Our effort and focus are on ensuring that they return to the negotiating table. We are absolutely committed to that.

[Lord Leigh of Hurley (Con)]

My Lords, will the Minister clarify a point? My understanding is that the reason that the ceasefire has collapsed is that Hamas refused to release prisoners—hostages—as had been agreed. Because of the continued refusal to release hostages, Israel determined that she had no choice but to go into military action. There is a history, time and again, of people breaking or not honouring agreements that might be to mutual interest. Perhaps the Minister might reflect on the offer that was made by Ehud Olmert to the then Palestinian Authority of 96% of the land, including the West Bank and the whole of east Jerusalem, and for Jerusalem to be an international city—a proper land swap—which was rejected.

[Lord Collins of Highbury (Lab)]

There are many reasons for breakdowns in any kind of process of negotiations. I am certainly not going to focus on who is to blame. Our focus is to ensure that people return to the negotiating table, because that is the only solution. I have heard the families of hostages making that call to get back to the negotiating table and implement the ceasefire agreement. Those are the voices in Israel that I hear.

Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025

Monday 24th March 2025 Lords Chamber

Prayer to Annul

17:46

Moved by

[Baroness Jones of Moulsecoomb]

That a Humble Address be presented to His Majesty praying that the Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025, laid before the House on 11 February, be annulled, as it damages the democratic accountability of local authorities to local residents, and has not been subject to full and proper consultation (SI 2025/137).

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)

[Baroness Jones of Moulsecoomb (GP)]

I was going to pause for a moment to see how many people flooded out; how nice it is to have your Lordships all here.

I thank the Minister for taking the time to discuss and explain the Government’s thinking on this decision to postpone some elections for at least a year. The promise to reorganise local government was in the Labour Party’s manifesto, but the method to be used was not, so this statutory instrument is not delivering a manifesto promise and therefore this House is well within its rights to vote against the proposition.

It is always a bad idea to cancel elections at the best of times, and this is clearly not the best of times; in fact, one could say it is the worst of times. We have more cuts to services at the moment than we have had for some time; they are already on their knees. We have council taxes going up again as people pay more for less. Local government is in a bit of a state, so I do not see the common sense in delaying elections and then starting them up or running them a year later with a plan to allow the current councils to devise the next move towards reorganisation. People have a right to vote—that is what being in a democracy means—and the timetable is set out and understood by the general public, so changing that seems a little unprincipled.

It is hard to think of anything less democratic than cancelling elections ahead of a significant change in local democracy; it is straight out of an authoritarian playbook. Creating a devolved mayoralty by cancelling county council elections just seems odd—in fact, nonsensical—and again is undemocratic at the very least. This rushed decision means that voters will not have the chance to have their say on new councillors for at least a year. That means that the councils that have delayed elections do not actually have a mandate to do the reorganisation that the Government are asking them to do. Voters should be able to decide which councillors will have the opportunity to plan for the new structure. Local political parties ought to put such plans into their manifestos for voters to see and vote for or against.

A lot of people who could potentially vote in May in the postponed elections will now be denied the chance to protest, complain and elect people who have a different vision of how their area should be run. I am told by a councillor in East Devon District Council that the council has already begun acting in line with the proposed reorganisation, despite no public consultation taking place due to an alleged lack of time, which is something that we have heard from the Government as well. Decisions have therefore been delegated to unelected officers and executives, raising clear concerns about democratic accountability and statutory obligations under the Localism Act 2011. In addition, the councillor admitted that neither councillors nor the electorate have a clear understanding of how this organisation will work or even what it will be, yet actions are being taken regardless. It seems that local authorities are already acting under the influence of centralised restructuring before it has even been democratically validated.

Is it really for the Secretary of State to select which elections can go ahead and which cannot? Does it not set a dangerous precedent to allow a Secretary of State to make these decisions? It is not a national emergency like Covid, when we understood why elections were postponed and which justified that decision. Do we accept that, for whatever good reason the Government think, the Secretary of State can disrupt the election cycle and delay elections to a convenient time? That is more than authoritarian, it is almost Trumpian—and I have to ask, is it legal? Earlier I consulted a member of the Bar, who is not in his seat. He said, “Oh, it depends”, which is probably what I should have expected. This fatal Motion would green-light the postponed elections to go ahead. But Labour have tabled this vote at the last possible moment on the last possible day so that the Government can now say to us, “It’s too late to go ahead”.

We are going to have mayoral elections next year, in 2026; I understand that the delayed elections will all be held then. Can the Minister reassure me that all delayed elections will be run next year? Then, in 2027, the new shadow principal authority will be elected. Again, this is quite fast. I understand that the Government promised this and therefore they need to move fast, but I am very concerned about the democratic processes here. Can the Minister confirm that this means that some councils and some councillors could be in post for three years beyond their original mandate?

There is also the problem of this being not about devolution at all but about making it easier for the Government to liaise with fewer stakeholders—that is, mayors. This is sucking power upwards and is not devolution at all. It is about the Government making life easier for themselves and giving local people less say in what happens in their local area.

Strategic planning decisions will be taken out of the hands of people who know the area and given to the mayor, who could take decisions against the interests of local residents. This is a reason not to rush into postponing elections. I am concerned about whether there has been an assessment of whether this arrangement will save money. Will it improve efficiency and support social cohesion? Will it give local people more access to knowledge and decision-making? If there is a report or an assessment, I am curious about who wrote it and when. I look forward to hearing the Minister’s answers, but clearly what is happening is not democratic. On that principle alone, I beg to move.

[Baroness Pinnock (LD)]

My Lords, I have relevant but not direct interests as a councillor and as a vice-president of the Local Government Association.

Elections are the bedrock of our democracy and should not—indeed, must not—be cancelled. Some 5.6 million people are being denied the right to vote this May in elections to seven county councils and two unitary councils. The critical question is, why have the Government agreed to such an anti-democratic measure? The Secretary of State’s justification is that the Government have what they are choosing to describe as an

“ambitious programme of local government reorganisation”

and devolution that will eventually see the demise of councils based on historic counties and the abolition of district councils. In their place will be unitary councils with a population of 500,000, making them much larger than any of the London boroughs. Some yet-to-be-agreed combination of councils will then elect a single person, a mayor, with considerable powers on, for instance, strategic planning—as we heard from the noble Baroness, Lady Jones—where the mayor will be able to allocate land for development without the agreement of residents.

The nine councils with cancelled elections were assessed by the Secretary of State to be more prepared than most in their reorganisation plans, and that therefore it

“would be an expensive and irresponsible waste of taxpayers’ money”

to hold elections

“to bodies that will not exist, and where we do not know what will replace them”.—[Official Report, Commons, 5/2/25; col. 767.]

However, in a meeting with the Minister it became clear that the reason for elections being cancelled is that the first step in consulting residents and interested parties had begun in February and would continue until April during the election period. This, rightly, was not acceptable. The option that does not seem to have been considered was to delay the elections until June. That has occurred in the recent past, on more than two occasions, and would both accommodate the need to consult and enable a new mandate to be given to decision-makers.

Furthermore, the cancelled elections will apparently take place in 2026, when it is expected that there will be elections for a new mayor and councillors to the county councils, which will still exist, and district councils. That is the advice we have been given. County councils and district councils will then make decisions on the geography of new unitary authorities. A new mandate from the electorate is therefore absolutely essential before those decisions are made, and not after—which is what will happen if these elections are cancelled.

Had we had elections, it would have had the benefit of alerting residents to the major changes being proposed, and getting their views direct to councillors. They would have been able to elect those they agree with and not elect those they do not agree with. That wide discussion is obviously not seen to be desirable by the existing council leadership—who called for the cancellation of the elections—and the Government.

It is on this particular aspect—the discussion element of this decision—that the Secondary Legislation Scrutiny Committee has raised concerns and drawn them to the attention of the House. The first of these concerns is about the extent and depth of the opposition to the cancellation of elections. The committee is highly critical of the Government for having failed to provide a response to the issues raised. Can the Minister provide a response—which should have been given to the concerns raised by the Secondary Legislation Scrutiny Committee—to the House before this vote is taken?

Surrey County Council is the exception to the situation I have described, because the reason for the cancellation of its elections is due to the dire financial state of some of its councils—one in particular has debts of more than £1 billion. The Government are enabling the county council, which is also in debt, to push through a reorganisation against the will of the districts. This is a democratic disgrace.

The Motion in the name of the noble Baroness, Lady Jones of Moulsecoomb, is deficient in its statement, in that it fails to mention the substantial purpose, which is the reorganisation and devolution plans of the Government. It is most unfortunate that the noble Baroness was unable to agree to a single Motion to Annul that had been the subject of a tentative agreement last week. If the noble Baroness puts her Motion to a vote, we on these Benches will abstain, in favour of voting for the stronger and more comprehensive Motion in my name.

18:00

The noble Baroness, Lady Scott of Bybrook, has tabled a regret Motion. I understand the intent and recognise the concerns about democratic accountability and the consultation process. However, we cannot fully support her Motion as it simply does not go far enough in defence of democracy. Although the convention to which her party adheres is not to support fatal Motions, it is not one that is absolute, as her party has voted on several occasions on fatal Motions in the past, including one on London elections. I urge the noble Baroness to make an exception today and support the Motion to annul. Democracy delayed is democracy denied.

[Baroness Scott of Bybrook (Con)]

My Lords, I declare my interest as a vice-president of the Local Government Association.

I rise to express deep concern over this statutory instrument, which marks yet another step in the Government’s rushed approach to local government restructuring. While we continue to support meaningful devolution that enables local communities to thrive and prosper, we are concerned about the process being followed and the sweeping changes being imposed top-down on our local authorities. Quite simply, devolution should be locally led, and these measures are not. We believe that no council should be coerced or pressured into restructuring by a top-down diktat from Whitehall. It is wrong for the Government to adopt a divide-and-rule approach to local government.

I turn to the effect of these measures. This statutory instrument is not just a procedural shift; it is a clear manifestation of the Government’s top-down approach to restructuring local government, with little or no consideration for local consensus. We are particularly concerned about the unprecedented delays—up to three years—and the prospect of existing councillors serving up to a seven-year term. The Government’s decision to bypass any public consultation on this is a significant failure. I ask the Minister: why were the public not consulted on these changes? How can the Government justify proceeding with such a major overhaul without having meaningful engagement with local communities first?

Local councils themselves were given a mere deadline of 10 January 2025 to submit expressions of interest for restructuring, with no further opportunity for public consultation or engagement with those who will be directly impacted by these decisions. The entire exercise has been rushed: from the publication of the devolution White Paper to a minimal feedback period of only four weeks, which included the Christmas break. District councils were never properly consulted either and residents have not been asked for their views. Local government experts have warned:

“We are dealing with the worst white paper for local government in living memory and one which treats it with cavalier disregard”.


That was from the “Local Authority” podcast of 26 January 2025. Will the Minister please respond to what I consider to be serious concerns?

We have heard that this statutory instrument claims to postpone the May 2025 elections, yet this is far more than a postponement. We believe it is an outright cancellation for these councils—specifically, East Sussex, Essex, Hampshire, the Isle of Wight, Norfolk, Suffolk, Surrey, Thurrock and West Sussex—all under the guise of the devolution priority programme. Can the Minister provide a clear timeline for these new elections, including county, unitary, district and mayoral elections, taking into account any changes to ward boundaries?

While I am on the subject of boundary changes, the long-term implications of such changes are a matter of great concern. As we move forward with the creation of new authorities and the restructuring of local government, the role of the Local Government Boundary Commission for England will be crucial in determining how these changes are implemented. Will the Minister outline the timetable for these boundary changes? We need to know when the Local Government Boundary Commission will begin its review and how long it will take to finalise the new boundaries for the affected councils. If she cannot answer today, please will she write to me with all those details?

Can the Minister also provide any assurance that the Local Government Boundary Commission’s recommendations will be made publicly available well in advance, allowing local councils, residents and other stakeholders to fully engage with and review the proposed changes before they are finalised, as has always been the case? Without clear communication and ample time for consultation, we risk a lack of transparency and fairness in redrawing the boundaries.

Given the concerns I have raised today, some noble Lords may be wondering why I have tabled a regret Motion and not a fatal Motion, such as those of the noble Baronesses, Lady Jones of Moulsecoomb and Lady Pinnock. We are the Official Opposition and there is a long-standing convention under successive Governments of all colours, and recognised by the major parties at least since the 1950s, on the constitutional relationship between the two Houses of Parliament. It is the responsibility of the House of Lords to scrutinise and, where appropriate, revise legislation—and, ultimately, to respect the will of the elected House. But that does not detract from the concerns I have raised today.

While we all want to work collaboratively with local government to ensure that these changes are beneficial for our communities, the current process has been rushed and lacks the necessary consideration of local views and the needs of local communities. We urge the Government to pause, reconsider the pace of these changes and offer a clearer, more structured plan that involves local authorities and their residents in shaping the future of what is their local government.

If the fatal Motions fall, I shall be testing the opinion of the House on my regret Motion.

[Lord Bach (Lab)]

My Lords, I support this Government’s plans for devolution. For years and years, the local government map has needed to be changed. That is a fact, but no Government have attempted to do it for many years.

Changing local government is not an easy task and requires political parties, and of course local authorities and the Government themselves, to look further than just at their short-term political advantage, so that England can enjoy a modern and effective local government system that has real power and influence, while taking some of the power away from the centre. This takes time and I commend the Government’s approach. The matter before the House today is of importance, but I really do not think that it is an attack on the principles of democracy. Those who say it is are mistaken.

I will make one further point before I sit down. The Government have proposals that had to be put in by 21 March—last week. They want and need time to consider them, and to come up with views and proposals themselves. I think that will be by the end of the year. It is one of those proposals that I want to talk about.

I want the Government to consider, when they make their proposals, something that, if acted on, will put right what I consider to be a serious mistake, or accident, that occurred many decades ago in the 1970s in England. Some noble Lords will remember the dividing up of English cities into metropolitan and non-metropolitan areas. Very sensibly, many cities had their boundaries increased so that they could accord with reality. They could have the space and the geographical diversity to offer their residents all that a city should, including space for new housing, green spaces and facilities of all kinds.

Examples of metropolitan cities which were properly extended include Leeds, Bradford and Sheffield. However, the non-metropolitan cities were not so lucky; their boundaries remained precisely the same. In many cases, these are boundaries that are now over 100 years old. This has led to city boundaries sometimes being totally artificial, with nowhere to build up housing. Any reasonable person using their common sense can see how ridiculous some of the boundaries are for cities at present. I should add that I have been a police and crime commissioner for an area that had unitary authorities, a county council and district councils. I have also been a local councillor in both a city and a district.

Leicester is a classic example of a non-metropolitan city at that time that suffered, as others did, from the ridiculous decisions taken in the 1970s. Its present boundaries are genuinely ridiculous. It is one of the most tightly constrained cities in the whole United Kingdom. Its boundaries have remained largely unchanged for 100 years. It has no chance of delivering, for example, the extra housing that is vitally needed. The population density is enormous compared with the cities I referred to that were lucky enough to have their boundaries extended. The figures speak for themselves. In Sheffield the population per square kilometre is 1,200 people. In Leicester, the population per square kilometre is 5,000 people. That is totally wrong.

I make these points in this debate because the Government will have to make their decision on issues such as this when it comes to the right time to make those decisions. I want to give the Government a chance to make the right decision as far as cities and other parts of local government are concerned. That is why I think the Government deserve our support tonight.

[Lord Rennard (LD)]

My Lords, there are times when it is entirely appropriate to postpone elections. Such times include during a wartime emergency; we postponed general elections throughout the Second World War. We also postponed local elections following the outbreak of the Covid pandemic in 2020. But there are at present no such extreme circumstances and, hence, I believe, no democratic justification for the postponement of the right of people to choose their local representatives according to the timetable previously agreed by both Houses of Parliament.

I mention both Houses of Parliament in this context because this House is in a unique position in relation to the postponement of elections. While all other legislation can be subject to the Parliament Acts, no government majority in the House of Commons can force the postponement of a general election without the specific consent of the House of Lords. That constitutional protection is to prevent the abuse of power by a party with a majority in the other place changing the rules of democratic engagement.

18:15

There may be many reasons why this Government do not want there to be many local elections in May. There may be many reasons why some Conservative administrations do not want elections in May either. But fearing electoral consequences should not take away people’s right to vote. Without it, people will not have a say on issues such as the effective abolition of many local councils and their replacement by new authorities covering far wider areas and with great power vested in a single person.

I am sometimes asked what my view is of local government in this country. I believe that we should try it. I am grateful to Professor Tony Travers of the London School of Economics for pointing out to me that there are about 18,000 councillors in the UK—a figure soon to be reduced significantly—while in France there are 36,000 councils or communes. The UK is often cited as the most centralised government in the western world, notwithstanding the post-1999 constitutional settlements.

Do we, in an unelected Chamber, have the right to say no to this? I believe that powers across both Houses cover general elections, but there are also more recent precedents concerning other levels of elections. My noble friend Lady Pinnock referred to the London mayoral elections of 2000, when the then Labour Government decided they wanted to bring in the London mayor and assembly elections but without the provision of a candidate’s election address in the traditional way. This House, with the support of Conservative Peers, considered this to be a significant abuse of power. Those elections were not allowed to take place until we had changed the rules to make them fairer.

The noble Baroness, Lady Scott of Bybrook, referred to the precedents for saying no—for fatal Motions—in these circumstances. I remind her and her colleagues of the words of the noble Lord, Lord Strathclyde, in his report on statutory instruments in 2015:

“Since 1968, a convention has existed that the House of Lords should not reject statutory instruments (or should do so only rarely)”.

The occasion in the year 2000 was one of those rare occasions, when I was supported by the noble Lord, Lord Strathclyde. Several fatal Motions have also been carried out by this House on other occasions. I consider this to be an appropriate occasion for this House to say that Governments should not be allowed to postpone elections at the last minute in this fashion.

[Lord Kerr of Kinlochard (CB)]

We need a sense of perspective. I am a member of the Secondary Legislation Scrutiny Committee, which drew this statutory instrument to the attention of the House, primarily because we thought the Explanatory Memorandum was inadequate and did not answer a number of the questions that had been raised. I do not recall us discussing in the committee whether democracy was in danger.

Two points seem to me to be relevant. First, 18 councils sought a postponement of their elections. It came bottom-up from the councils; it was not a postponement imposed by the Government. These were postponements sought by the democratically elected representatives of the people.

Secondly, only nine of the 18 secured government agreement to the postponement of their elections, so the statutory instrument concerns only nine. Clearly, then, if this is the rights of the people being denied by the wicked Government—by the Ceausescus of the Front Bench—clearly, we are looking for the Trotskyite regimes that run the councils of East Sussex, Essex, Hampshire, the Isle of Wight, Norfolk, Suffolk, Thurrock and West Sussex. It does not feel like that to me. I do think we need to retain a sense of perspective and I would vote against both fatal Motions.

[Lord Stoneham of Droxford (LD)]

My Lords, I am pleased to follow the noble Lord, Lord Kerr, but let me just point out to him that politicians do not want elections when they know they are going to lose, and they like elections when they know they are going to win. The fact behind this decision is that, despite the Conservatives’ regret Motion, most of the councils that are postponing their elections are Conservative-controlled. They know that they had a very good year in 2021—an exceptional year—and that they were going to lose control of most of the councils that had elections this year. Sadly, with Labour in government, it knows that its vote is going to be difficult to get out and it has concerns about how well it is going to do. We know we did quite well and have to accept that.

The top-down model that the Conservatives were talking about—in respect of the reorganisation of local government—is actually pretty much the model they had in government, for what they were going for. Their main motivation is that they would lose against the results in 2021. In my area, there are no elections in Surrey, Sussex and Hampshire. I understand that the Government want their reorganisation, but I think they could have either postponed the consultation a little bit by a month or two, or, indeed, arranged that the elections should be held in June, a month or two later, after the consultation.

I will give you the example of my own patch of Hampshire. We have big financial problems in Hampshire. The Conservative-run county council has a deficit coming up of £183 million next year. It wanted to put council tax up by 15% and asked the Government to put council tax up by that much. A lot of the problems go back to their Government, because they did not provide the money, but that is the reality in Hampshire. We are going to end up, in Hampshire, as a result of having no elections, with a fag-end county council, which I would say is unrepresentative, having to impose pretty severe cuts on services when it knows it probably will not exist in three or four years’ time. Probably, in our patch, we will have no elections until 2027 or 2028, unless the Government promise we will have county elections next year. If we are going to have county elections next year, we might as well have had them this year.

There are three conclusions I draw. One is that it is better to have elections this year than wait for possible elections in 2027 or 2028. I think the Government should declare whether we are going to have elections next year or, if there is a reorganisation, whether we are going to have a further extension of councillors’ remit, so that they will have been in power in the county council for seven or eight years by the time we get around to having elections.

The second thing that is really important is that, for God’s sake, we must sort out the finances of these councils. Southampton is Labour-controlled and Hampshire is Conservative-controlled, and they are frankly in deep, deep trouble. If those problems are handed over to a reorganised Hampshire local government organisation, it will not succeed. That is why we need reform, but we do not benefit that reform by getting a postponement of the elections. Unless the financial situation is sorted, reorganisation in my county of Hampshire will not get off on the right foot. We will have all the local authorities in that area blaming each other for the fact that it is not going well, and trying to push the financial deficits on to each other. It will be a disaster.

Let me just give your Lordships a bit of hope, which I hope, by having elections, we might see. Southampton, Hampshire and Farnborough in the 1930s were the Silicon Valley of the United Kingdom. We had a very successful aviation industry, with the invention of the Spitfire; Farnborough was also a big centre of research and Southampton was one of the main ports to America. The Blitz and the war led to a lot of those industries moving north or to the south. What we need in our county is a well-funded series of unitary authorities and a mayor who will lead us back to that growth that we want and which the Government want.

However, we are not going to do it if we start off with unrepresentative councils as a result of elections being suspended. The county council is hugely unrepresentative now, because it had an exceptionally good year in 2021 and will probably be in power for six or seven years through this period. The county council is going to be leading some of the discussions on reorganisation in Hampshire, and that is the problem. We want to start with representative councils and do not want to postpone the elections.

[Lord Fuller (Con)]

My Lords, it is a funny thing when the unelected House of Lords has to regret the cancellation of elections. Democracy is the foundation stone on which the fabric of our nation is built. It is not to be carelessly discarded and requires the most careful consideration. I accept that general elections are far more important than most, but local elections are not any less valuable in shaping the local doorstep issues that people value the most in their towns, villages and cities. I am a councillor, and a veteran of many local elections, so I know more than most how they keep councillors on their toes, and refresh and reinvigorate those councils.

I accept that elections have been cancelled before—under the Local Government Act 2000 and in special circumstances such as Covid or foot-and-mouth. Those are truly exceptional circumstances, mostly in cases of national emergency where all elections in all areas are cancelled, but that is not the case here. We are not cancelling elections in an emergency, where Section 87 of the Local Government Act 2000 is engaged. No, this is a case of devolution and local government reorganisation, where, last week, the Minister in the other place could give no assurance that the process would be complete even in this Parliament, by 2029. Time is clearly not of the essence, so what is the rush today?

When the Secretary of State wishes to move the local government deckchairs around the deck, Parliament has determined the process to be followed in bespoke legislation: Section 7 of the Local Government and Public Involvement in Health Act 2007. It lays out in excruciating detail the particular processes, statutory tests and consultation requirements that must be engaged before elections can be cancelled in local government reorganisations. I am grateful to the Library for all the research it has done on this.

The Government say that they are following the precedent set in 2021, when Somerset, Cumbria and Yorkshire were reorganised, but they are wrong, and I will explain why. Back in 2021, the process started in October—fully seven months out from the proposed elections. Back then, all principal authorities and other interested parties were invited to make proposals. Those proposals resulted in the number that came forward, and Members of Parliament and the public were fully engaged. Later that February, the Government expressed a preference in a well-defined timetable and laid orders and cancelled the elections, following the process established by the Labour Government in 2007.

Let us contrast that with this time. This time, the majority of the cohort of principal authorities were excluded from the discussions, as the Minister will know. Only about 30 of the 200 or so principal councils affected by the proposals were engaged before the Secretary of State made her decisions. How does she justify that? Invitations were circulated to those 30 or so councils, mostly the county councils, to endorse the concept of a mayoral devolution, with carrots—nods and winks—to agree that they would cancel their elections. There was no public consultation. Consider for a moment the conflict of interest in asking the councils facing elections whether they would like to cancel those elections without asking the other principal authorities what they thought of the idea, to say nothing of asking the public what they felt. In January, 18 of the councils wrote to say that they would quite like to dispense with those elections in exchange for a connivance on the mayoralty and, oh yes, early LGR.

I am reminded of my noble friend Lord Pickles, who is no longer in his place. He told me, as a young council leader, “If you don’t trust the folks, don’t go into politics”. So in February, when the Secretary of State said that nine of them had got lucky, if that is an appropriate phrase for denying electors their democratic right, it was announced that their elections would be cancelled. You have to feel for the 10 that were suckered into asking for cancellation but got the mayor anyway.

The Government have wilfully conflated two separate, albeit linked, ideas: devolution and the creation of a mayor; and LGR and the abolition of councils. We were told that the population size for the new councils would be at least 500,000, with no upper limit. We now learn from the Minister that the figure is between 350,000 and 500,000, with the possibility that 500,000 may just be the average within a territory. The 30 councils that connived were misled and entered into the process on a false prospectus. They were suckered. Councils and mayoralties are different. You do not speed the creation of one by cancelling elections to the other. That exposes the dishonesty of the Government’s approach and is why we are right to regret their actions.

18:30

We find ourselves debating this on 24 March. By law, the publication of notice of election must be made tomorrow. You have to admire the way the Government have run down the clock on this. The Secretary of State said that the rationale for cancelling this year’s elections hinged on the fact that it would be pointless to have elections for councils that could just be abolished a year later. But next year, on that timetable, there will still be two years to go to 2028, so unless those elections are cancelled on that basis, councillors will serve, as the noble Lord has said, an unprecedented seven-year term. In what universe is that acceptable? What assurances can the Minister give, on the record, about not cancelling next year’s polls as well? By her reasoning, there may be better justification to cancel then than cancelling now: at least the public would have a chance to have their say on the devolution opportunity before their plans become a done deal. Or is that the real plan?

When all is said and done, we have ended up in a situation where the Secretary of State has picked and chosen the elections she would like to avoid, and then only in those areas where, to party advantage, it has been expedient for Labour. For there is to be no reorganisation in London, or in the failed Birmingham authority where the rubbish is piling up in the streets, or in Manchester. There are more councillors within the M25 than in all the county councils of England, and Labour is using all this to create a permanent, structural metropolitan bias in the way our country is governed, extending its war on the countryside to the fabric of our constitution.

The Minister has previously pointed to a PwC report that suggests that all this will make significant savings, but of course that is not how it has worked out in Somerset. I am fresh from chairing the Local Government Pension Scheme this morning, and I can tell the House for the first time that that PwC report makes no allowance for the pension strain costs of all these reorganisations and the astonishingly eye-watering pension strain costs that will allow senior local government officials to take retirement on a full pension at either 55 or 57 on efficiency grounds. I heard today that additional pension strain could easily be £500,000 per person. In their haste, the Government are sleepwalking into a billion-pound pension strain black hole entirely of their own making.

Most of all, it will not save any money for the ratepayer. The counties and districts, the most efficient and local parts of government, will be merged, but then a new, more remote layer is being applied on top, with towns and parishes that were unconstrained on revenue-raising remaining. The Government are moving too quickly, and local people will pay for this devolution sleight of hand that will see us moving from three value layers to three expensive layers, while taking the electors for fools and playing fast and loose with democracy. I am not against local government reorganisation, but the Government need to remember that all the orders for their plans must pass through this place and, once bitten, this House will be twice shy.

My heart would like to support the fatal Motion and, had it been more prompt, there would have been strong reasons and precedent from 2000 to do so, as the noble Lord, Lord Rennard, said, but I am conscious of the conventions of the House and, importantly and practically, that elections must be called tomorrow. It is too late to cancel them now, not just for the parties to get their candidates in place but for the officials who need to book the village halls and staff the count. So I will support the regret Motion, but my biggest regret is that it was, for the most part, my Conservative councillor colleagues who turned into the biggest losers, by conniving with Labour on their own destruction while allowing the Labour Party to pick and choose the elections it does not want to fight.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I support the spirit of all three of these Motions and I especially commend the noble Baronesses, Lady Jones of Moulsecoomb and Lady Pinnock, for making their Motions fatal. I was interested to hear the noble Lord, Lord Kerr, reassure us and tell us, in effect, not to worry our pretty little heads and to stop panicking—he did not use that language, I am. It was then interesting that there was quite a lot of laughter on the Benches opposite; there is this sense of, “What is all the fuss about?” I suggest that this is not a game and it really matters for voters. There is a lot at stake here, not least the reputation of the democratic process.

For the last week or so, Government Ministers have talked about a fictional drama as though it is factual evidence, concluding that a Netflix series should inform policy on countering the radicalisation of young boys, so maybe the Government will accept my factual, if anecdotal, evidence of how the cancellation of council elections is fuelling the radicalising of young people to become cynical about democracy. I was recently giving a talk to a student group about the importance of democratic engagement to a free society, and I was taken aback by just how cynical they were. The majority said, “Democracy is a sham”—that was the popular sentiment. I was even more surprised when their evidence centred on councils, not something that the young generally chat about. One of them summed it up when he said, “They cancelled the Romanian presidential elections and banned the popular candidate from standing. Now our Government have cancelled the council elections because they are scared that austerity Labour will get a drubbing”. Whether we like it or not—and I argued against that slightly conspiratorial tone, by the way—we can see why they might draw that conclusion.

Beyond those young cynics, there is a lot of anger about this issue. Five and a half million people feel that they have had their votes cancelled and they feel cheated. It is being discussed in workplaces, in the pub, on phone-ins and on social media. People will say things like, “There are challenger parties doing well in the polls. They don’t want to see how they get on”. There is a certain volatility around politics at the moment and people want to make their views heard. People are frustrated that, for example, just when voters are facing council tax rises and horrible cuts in local council services, they do not get a chance to comment locally. In rural areas, where those on family farms are so worried about recent policies, so worried that their livelihoods are going to be destroyed, they do not get a chance to vote. We have been told that these are being postponed for only a year, but a lot can happen in a year: in less than a year, some devastating policies have been brought in by the Government that people might have a view on. That will be true as well, so I would rather that people were given a vote, even if then they had to have the election again, than just be told, “Don’t you worry, you’ll get a vote eventually”.

Local issues matter to people. If noble Lords were listening this morning to the discussions on the media about rats as large as cats and the bin strike in Birmingham, they will have heard people passionately talking about what is happening in their local area. We have to understand that people want their voices and their views to count, and many feel robbed by this decision. They do not want to be fobbed off by technical excuses about the importance of devolution and somebody at the top making a decision that will give them more democracy at some time. They are basically being told that voters’ access to the ballot box should be trumped by a policy reorganisation. Also, as the noble Baroness, Lady Jones, suggests, it seems to make a mockery of the notion that these devolution changes will bring more accountability.

The lack of consultation mentioned by the noble Baroness, Lady Scott of Byford, is especially egregious. Although I have a lot to say on devolution, on these devolutionary forms and their shortcomings, now is not the time and I will not say it now, but I think it would be wrong for the Government not to at least note that people feel that this is a contemptuous disregard for voters’ aspirations to exert their rightful right to vote for or vote out politicians as they choose, as they expected to. They are disappointed and many people are actually looking at parliamentary TV, for once, to see which way we go today. Who would have thought that that would happen? But there you go.

[Lord Jamieson (Con)]

My Lords, I declare my interest as a councillor in Central Bedfordshire who is not participating in this process. I speak in support of the regret Motion tabled by my noble friend Lady Scott of Bybrook. As chairman of the Local Government Association, I campaigned vigorously for greater devolution, and I am still very supportive of devolution. I also led a unitary council for 10 years and can testify to the benefits of unitary councils. However, if we are genuinely to have devolution and well-run services, it needs to be locally led, with real powers and local accountability. We cannot treat local government as little more than a delivery arm of central government, tied up in regulation, with budget controls and with central targets and funding pots.

When this country saw the biggest improvement in health, education, social support, infrastructure and so forth, it was all locally led. If you go back to the turn of the 20th century, local government was truly empowered, delivering education, health, social care, social support, infrastructure and even gas and water supplies. It was genuinely financially independent of central government. Over the last century, central government has steadily eroded the role of local government, placed more controls and reduced its financial freedoms while increasing burdens on local councils.

I am a believer that form should follow function. We should see real devolution which would enable genuine financial independence from central government, with a much greater role in economic development, community health, education and skills for getting people back to work; this would enable every area to flourish with real levelling up. This is what the Government should have started with, because locally we could have then answered the question of what would be appropriate structures to deliver this. It would also significantly reduce local argument as the prize and objective would have been clear to all.

Instead, we have top-down reorganisation. The Government have been clear that they intend to use their large majority in the other place to force through unitarisation and have mayors across the country. There is a clear message that funding will be tight, so councils will have to make significant savings, which the Government expect to be delivered by unitarisation. It is understandable that, in these circumstances, many councils have concluded that it is better to participate in order to have some control over their destiny and potentially some meagre rewards, rather than be done to by government diktat.

So I have sympathy with those councils that, due to the need to meet a government-imposed timetable, asked for a delay in their elections. But it did not need to be this way. The Government could and should have worked with local government. They should have brought forward real proposals for real devolution with a clear timetable that respected the democratic process. They should have brought forward proposals to address some of the biggest issues in local government, such as social care and SEND. They should have looked at how, by addressing the perverse incentives, the blockages in the system and creating genuine local place-based working, these could have been addressed.

You cannot look at local government reorganisation without looking at, for instance, the healthcare system and how that works. But, no, this Government are favouring imposition over co-operation, avoiding the difficult decisions and not delivering real devolution. That is why I will be supporting by noble friend Lady Scott’s Motion to Regret.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, that has been a really interesting debate. I understand and I have listened to the concerns around the Chamber. The Government have been very clear on our manifesto commitment to widen devolution to more areas. We have been clear on our vision for a simpler, more sustainable local government structure, alongside transfer of power and funding out of Westminster through a devolution process. We have been clear on our willingness to take all the appropriate steps needed to deliver this vision, working with councils to fix the foundations of local government and support communities to join the devolution revolution.

18:45

The noble Baronesses, Lady Scott and Lady Pinnock, asked why the public were not asked. As they both stated, however, this was a manifesto commitment, so they were consulted in the general election about the fact that we need a reorganisation of local government and a devolution agenda. The English Devolution White Paper set out the scale of our ambition for a programme of local government reform and a mayoral devolution on such a scale that we believe this is a once in a generation reform. We will not miss the opportunity to deliver these benefits to people as quickly as possible. So, we have taken this step to help those areas which have expressed their firm commitment to deliver to the most ambitious timeframe.

In our White Paper, we were clear that strong, decisive and collaborative leadership locally will be met with an active partner nationally. We were also clear that we would take decisions to postpone local elections where this would help to smooth the transition process. We will follow through on these commitments and we will not miss this opportunity to deliver the benefits of mayoral devolution and fit and stable unitary local government to the people we serve as quickly as possible.

We have taken the step to make this order to help those areas which have expressed their firm commitment to deliver to the most ambitious timeframe. We are now working with those areas to prioritise, in parallel, the steps necessary to develop plans for new unitary government. We are also consulting widely on the proposals to establish the new mayoral authorities in time for the May 2026 mayoral elections.

If successful, the fatal Motions would impact councils’ ability to deliver on the mayoral elections in 2026 and deprive the people in those areas of the powers and funding that they should have. It would not be possible to do this at such a pace when also holding the 2025 local elections in those areas. Councils were invited to make their case, and we considered requests for elections to be postponed until May 2026 only where it was clear this would be necessary to deliver the significant amount of work needed to unlock devolution and deliver reorganisation to the fastest possible timescale.

I must stress that decisions were taken on the basis of local requests to free up capacity to take the practical steps needed. These steps include public consultations from 17 February through to 13 April in affected areas and working towards delivering elections to new mayoral strategic authorities in May 2026. The local engagement is needed to develop detailed proposals to establish strong and stable unitary councils that are fit for the future.

I can therefore assure noble Lords that the Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025 is essential to allow this first wave of an ambitious programme to be delivered. This order grants permission for postponement for 12 months only and is only for the nine councils whose requests met the high bar we set. These areas have demonstrated the clear and strong local leadership and ambition that is needed to drive forward this programme to these timelines. The Government will get on with delivering what areas need, including taking the difficult decisions that are needed.

I turn now to some of the comments made by noble Lords. The noble Baroness, Lady Jones of Moulsecoomb, mentioned the manifesto commitment. Our commitment was to deliver devolution to the fastest possible timescale. Our manifesto was explicit that the Government would seek to widen devolution to more areas, and we are now seeking to deliver our manifesto commitment to the fastest possible timescale, which requires these election delays.

Both the noble Baroness, Lady Jones, and the noble Lord, Lord Rennard, also referred to local government’s financial situation, and it is that very resilience and financial stability in local government that make this kind of reorganisation essential now. Of course we must sort out the finances; we made a start this year and we will continue that work in the spending review looking ahead.

The noble Lord, Lord Stoneham, said that what we need is well-funded unitary authorities and mayors. I totally agree with him. The quicker we can get that moving, the better.

A fatal Motion would be an unprecedented step by the House of Lords. Similar election delay SIs were laid by the previous Government, with no fatal Motion from the Lords or the Commons. These Motions undermine the convention of the primacy of the Commons and the principle of delegated powers, which have been previously used, as set out in primary legislation.

The noble Lord, Lord Kerr, and the noble Baronesses, Lady Pinnock, Lady Jones and Lady Scott, referred to divide and rule, in relation to the local request for postponement. Ministers wrote to all areas following the publication of the White Paper and acknowledged that, for some areas, the timing of May 2025 local elections would affect their planning, particularly for those keen to deliver to the most ambitious timeframe. We have been very clear that the bar for postponing 2025 elections was set very high and would be permitted only if it could help deliver both reorganisation and devolution to that most ambitious timeframe—unlocking, importantly, the opportunities that will bring for local people in those areas.

In response to the Government’s letter of 24 December, 18 councils made requests that involved postponing their elections. Nine requests were agreed and the councils have had their 2025 elections postponed until May 2026. I will go into more detail about the timetable in a moment.

I have never been described as either Ceau escu or Trotskyite before. The noble Lord, Lord Kerr, referred to the Trotskyite regimes of Sussex and Essex and urged us to have a sense of perspective. That is very important and I am grateful for his comments and his clarification of some of the comments of the Secondary Legislation Scrutiny Committee. Of course, we take those seriously.

The noble Lord, Lord Stoneham, mentioned that county councils were involved in this. I have met with all the groups that are concerned and they have very much been working in collaboration with their district councils. It has been really good to see the way that this has brought about local governments working together. County councils were consulted about the postponement because they were their elections: that is quite straightforward. The noble Lord, Lord Fuller, mentioned that. Of course, it has to be local government reorganisation and devolution going hand in hand. The two work together for that.

[Lord Fuller (Con)]

Does the noble Baroness accept that, under Section 7 of the Local Government and Public Involvement in Health Act—which governs local government reorganisation—it is a statutory requirement that all principal authorities are engaged with? By that I mean not just the county councils but all the districts, upper tier unitaries and so forth—not the parishes but the principal authorities. Does the noble Baroness further accept that only 30 or so of the 200 or so councils that should have been consulted were actually consulted?

[Baroness Taylor of Stevenage (Lab)]

I will answer the noble Lord’s point further in a moment. Following a question he asked me earlier, I checked the legal requirements, and my understanding is that all the legal requirements have been met in this process.

The noble Baronesses, Lady Pinnock, Lady Jones and Lady Fox, raised the issue of democratic accountability and elections. To clear up a point, there are no elections postponed in Devon. I do not know whether that was raised with the noble Baronesses, but elections are not postponed in Devon. Nothing is being imposed on local areas. The commitment to join the devolution priority programme and the emerging proposals for new unitary councils were all bottom-up. All requests for election delays to unlock reorganisation and devolution to the fastest possible timeline followed direct requests from the leaders of affected upper-tier councils—not the Secretary of State, as was stated by the noble Baroness, Lady Jones.

Devolution and strong councils with the right powers mean that hard-working councillors and mayors can focus on delivering for their residents. That will strengthen the democratic accountability of local government to local residents. Postponing this small number of elections will enable mayoral devolution to be delivered in parallel with reduced timescales, so that working people and communities get those benefits—the powers, funding and freedoms—far more quickly, with mayoral elections and elections to new councils increasing democratic accountability, not reducing it.

We do not agree that there is a lack of consultation. We are consulting now in eight of these council areas on mayoral devolution, and we have asked councils to engage widely as they develop their proposals for reorganisation. Once a proposal has been submitted, it will be for the Government to decide on taking a proposal forward and then to consult, as required by statute. Some 13,000 people have responded to those consultations already, so people are engaging with the process.

A number of noble Lords mentioned the timetable. I think there has been some misunderstanding, so I will cover this. The noble Baroness, Lady Jones, asked for clarity on the timetable, and I understand why she would want that, as did the noble Baronesses, Lady Pinnock, Lady Scott and Lady Fox, and the noble Lords, Lord Stoneham and Lord Fuller. The starting point is for all elections to go ahead, unless there is strong justification. In May 2026, we intend that mayoral elections for new strategic authorities will take place, alongside those district and unitary elections already scheduled and elections postponed from May 2025. For any area in which elections are postponed, we will work with areas to move to elections to new shadow unitary councils as soon as possible, as is the usual arrangement in the process of local government reorganisation. For areas in the priority programme, this will mean mayoral elections in May 2026, alongside and in addition to the rescheduled local elections. We will work with areas to move to new shadow unitary elections as quickly as possible.

Postponement is essential for the delivery of the devolution priority programme, with inaugural mayoral elections in May 2026 and complementary reorganisation. We have no plans to postpone district council elections in 2026; we intend these to take place as scheduled, alongside elections postponed in 2025. The date of any unitary council elections will depend on the nature of proposals for local government reorganisation and progress on the development of those proposals. They are moving on different timetables.

On the issue of strategic planning, raised by the noble Baronesses, Lady Jones and Lady Pinnock, local plans will still be the responsibility of local authorities. Strategic planning at mayoral level will inform that planning, not replace it. It is done at mayoral rather than national level, so this is increasing devolution, not reducing it.

The noble Baroness, Lady Jones, made a point about saving money. We have had a PwC report, which set out the opportunity for areas undertaking reorganisation to achieve efficiencies when moving to a single unitary structure. In fact, North Yorkshire Council, established in 2023, expects to achieve more than £40 million in savings by March 2026. There is precedent for significant savings.

The noble Baroness, Lady Pinnock, mentioned Surrey. This single-year postponement is intended to give local leaders the time and capacity to plan for new structures, with local leadership in place until after the full reorganisation proposals have been submitted. We agreed to delay elections in Surrey to expedite local government reorganisation because of the perilous financial state of some of the authorities in that locality. The Government are getting on with delivering this.

All two-tier areas have been invited to develop proposals for reorganisation. I am delighted to confirm that every single area, comprising councils of all political stripes, has responded to the invitation to reorganise and submit an interim plan by 21 March. A Written Ministerial Statement has been laid before the House today, setting out the details.

The noble Baroness, Lady Pinnock, asked about the Secondary Legislation Scrutiny Committee. I think the noble Lord, Lord Khan, probably replied better than I could on this. In response to her question about the date, we do not have powers to delay a date; we can delay only the year, not the date. It would require primary legislation to postpone until June.

The noble Lords, Lord Rennard and Lord Fuller, raised the issue of precedence in postponing elections. Between 2019 and 2022, the Conservative Government legislated to postpone 17 local council elections for one year and cancelled a further 13 elections as part of legislation giving effect to unitarisation proposals, with the latter having the effect that the elections did not take place, as the councils were abolished. All local elections scheduled to take place in 2020 were subsequently postponed, of course, because of Covid. I could go into further detail, but I will not take up noble Lords’ time.

The noble Baroness, Lady Scott, raised the issue of boundary review. I am very happy to write to her further on the timetable. On the process for local government boundary review, I know, because we have just gone through it in Stevenage, what a thorough process that is. There is no intention to curtail the process of extensive consultation as we go through this process.

My noble friend Lord Bach referred to the process of devolution and the need for a modern and efficient local government system, and I agree with him 100%. We have had three decades of delay in moving this forward, so to noble Lords who said this is rushed and hurried, can I just say that it does not feel that way to me? I have been in local government for 30 years, and we have been trying to do it for all that time. In relation to the English cities, for councils which have not already been part of a reorganisation process, if those areas feel it is appropriate, they will have submitted those changes in their plans or they will be working them for the second stage of planning.

19:00

The noble Lord, Lord Rennard, spoke about his view of local government being that we should try it and see if it works. But local government without powers and funding is not local government at all. My budget was cut every year for the 16 and a half years that I was a council leader. No councillors go into local government to cut services. By reorganising them, we can give them the powers and funding they need to get on with the job.

The noble Lord, Lord Fuller, asked a question about pension strain. I do not have the answer, but I will reply to him on that point. In response to his question about what is the rush, I refer to my earlier comments.

To the noble Baroness, Lady Fox, I say it is a bit of a stretch to blame local government reorganisation for fuelling the radicalisation of young people. However, I take her comment seriously because it is a serious issue. In my local elections in May, we had more young people coming forward to be councillors than we have ever had. For young people to be engaging in local government, it must be meaningful, and the opportunities of the new role in the newly reorganised local council present fantastic opportunities for young councillors, and I hope that they will step forward for those.

The noble Lord, Lord Jamieson, commented that the best improvements are locally led. I totally support that; he is right. But the biggest erosion of powers and funding we have seen was over the last 14 years. I just point out that his local council was one that was, and remains, keen to take part in this process.

The Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025, which is the subject of the Motions laid by the noble Baronesses, and which was laid on 11 February, is essential to delivering our Government’s commitment on devolution to the fastest possible timetable. It will get powers and funding out to serve the people that we all serve. I hope that the Motions will be voted down this evening, and I urge your Lordships to join us in doing that.

[Baroness Scott of Bybrook (Con)]

Before the Minister sits down, on the question of the manifesto and devolution, I do not think it was very clear to communities or individuals that “devolution” also meant local government reorganisation.

[Baroness Taylor of Stevenage (Lab)]

I hear the noble Baroness’s view, but the councils that have come forward feel that they need that reorganisation to enter properly into the devolution process. If we are going to get powers and funding out of this bit of Westminster and out to the areas, that elected representation at local level is key.

The Motions put forward by the noble Baronesses would be an unprecedented step by the House of Lords, with serious constitutional and practical consequences. The Motions undermine the convention of the primacy of the Commons and the principle of delegated powers, which have been given in primary legislation granted here and have been previously used in this way. All appropriate steps were taken, and both process and precedent carefully followed.

A vote to agree with these Motions for Annulment at this stage, the evening before the last day by which elections must be called, would throw areas into chaos, damaging the safe running of those elections and confusing the live consultations that are under way, in which we are receiving significant public interest, with, as I said, over 13,000 responses already. The people engaged believe, as we do, that the order is in the interests of the people we all serve. The Motions would slow down the delivery of the benefits of mayoral devolution and strong unitary local government to those areas. It is these Motions, not the order they object to, that are damaging to local democracy. I urge you in the strongest terms to deny them.

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I forgot to mention that I am also a vice-president of the Local Government Association.

I thank all noble Lords who have spoken in this debate. A lot of issues were raised and the Minister has given a very full answer, which I am sure I will read with great interest in Hansard tomorrow. Clearly, she and the Government will be held to account on that.

It seems a little mean to accuse us of bringing this so late to your Lordships’ House when actually it is the Government’s timetable that we are operating to. We had no choice. The fact that it is 7 pm on the night before is not our choice; it is the Government’s choice to do it, so the Government have made it too late to do this.

There is also the fact that Labour has completely changed the meaning of devolution. What is happening is not devolution; it is actually sucking power upwards. My Motion is not about devolution but about the way it is being done. I think that is deeply undemocratic, despite what the noble Lord, Lord Kerr, had to say about it. I am quite disappointed that the Conservatives, His Majesty’s Opposition, could not vote for a fatal Motion. I did use their wording in my fatal Motion to encourage them, but clearly that did not work. If the Government are wrong—on this side of the Chamber we all agree that they are wrong—surely we want to draw that mistake to their attention. They are making a terrible mistake, and if we are not going to draw their attention to something like this now, when are we going to do it?

I also regret that the Liberal Democrats did not reach out before tabling their Motion. That is a real shame. I am not known for my powers of compromise, but I am, I think—I hope—known for my principles, and I would have done my best to come to some agreement. The Liberal Democrats did not attempt that, so to me what they are doing now looks like game playing, not a principled move. Surely a fatal Motion is a fatal Motion, and whether you vote for mine or for theirs, it does the same thing: it draws attention to the fact that many of us are not happy about what is happening. We care about local democracy, not game playing.

Affected councillors and residents do not have a vote here, but we do, and there are times when we really ought to use that vote for the common good. I feel that is not happening this evening. I hate to waste the time of your Lordships’ House, despite the fact that it is only 7 pm—it is not even my bedtime yet, and I go to bed very early.

[Lord Kerr of Kinlochard (CB)]

Too much information!

[Baroness Jones of Moulsecoomb (GP)]

Who said that?

I do not play games and I vote on my principles, so I am going to withdraw my Motion. I will vote for the Lib Dems’ Motion, but I am appalled at their behaviour this evening and I think it will come back to haunt them.

Motion withdrawn.

Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025

Monday 24th March 2025 Lords Chamber

Prayer to Annul

19:08

Moved by

[Baroness Pinnock]

That a Humble Address be presented to His Majesty praying that the Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025, laid before the House on 11 February, be annulled, as it denies timely democratic representation to a substantial portion of the electorate; undermines local democratic accountability; disrupts established electoral cycles; lacks sufficient consultation; and erodes the democratic mandate for major restructuring of local government (SI 2025/137).

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)

[Baroness Pinnock (LD)]

My Lords, I thank the Minister for a very detailed response putting the case, which she did very strongly, for the reasons behind the curtailment of elections this May. She has not, unfortunately, explained why those elections could not have been delayed until June. That has happened before. I am a councillor, and I remember voting in June for local elections to coincide with European elections. They could have been delayed to June, and that would have enabled those councils to have an up-to-date mandate to make those changes. That is at the heart of my concerns: 5.6 million people will not be able to vote this May in order to have their say on fundamental changes to local government.

On a happy note, we will need to have more controversial debates about local government. I have never seen so many people in this House wanting to be involved with local government, which I applaud. On that basis, I wish to test the opinion of the House.

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

I should inform the House that if this Motion is agreed to, I will be unable to call the Motion in the name of the noble Baroness, Scott of Bybrook, by reason of pre-emption.

19:10

Division 4

Ayes: 63

Noes: 163

Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025

Monday 24th March 2025 Lords Chamber

Motion to Regret

19:20

Moved by

[Baroness Scott of Bybrook]

That this House regrets that the Local Authorities (Changes to Years of Ordinary Elections) (England) Order 2025, laid before the House on 11 February, damages the democratic accountability of local authorities to local residents, and has not been subject to full and proper consultation (SI 2025/137).

Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument).

[Baroness Scott of Bybrook (Con)]

My Lords, I have listened very carefully to the Minister, and I thank her for her answers, but I believe there are still many unanswered questions on this subject—for both local government and the communities that local government serves, so I wish to test the opinion of the House.

19:20

Division 5

Ayes: 139

Noes: 152

House adjourned at 7.31 pm.