My Lords, welcome to an afternoon of Questions for Short Debate. If there is a Division in the Chamber, we will adjourn the Committee for 10 minutes, but the fact is the Chamber will be full for many hours with the Bill, so I do not expect any votes whatever.
(2 days, 7 hours ago)
Grand CommitteeTo ask His Majesty’s Government what steps they are taking to ensure all NHS staff have sufficient access to single-sex spaces.
My Lords, if there is any area of the country that is greatly affected by the Supreme Court judgment, it is the NHS: one of the largest organisations in the country, with over a million employees working long hours, at the most horrendous times of the day and night, in difficult, stressful conditions—needing to change into and out of scrubs, and to rest when they can.
I am most grateful to the charity Sex Matters for its briefing on this important issue, and to several other organisations. I am also grateful to noble Lords and noble Baronesses for taking part in this most important debate.
As I understand it—I trust that I shall be corrected if I am wrong—hospitals, as service providers, can provide a mixture of joint, mixed-sex and single-sex spaces for patients, and this is what they do. But this debate is about the provision for staff. As employers, hospitals are required under the Workplace (Health, Safety and Welfare) Regulations 1992 to provide single-sex spaces.
Yesterday, in answer to a Written Question, the Minister in another place, Karin Smyth, said:
“Single-sex spaces are protected in law and will always be protected by the Government. This is the law, and we expect all public service bodies to comply. The recent Supreme Court ruling in the For Women Scotland case has provided much needed confidence and clarity for the National Health Service to adapt its policies to ensure that same-sex spaces are always protected. This includes NHS England’s review of the Delivering same-sex accommodation guidance, as well as providers’ policies on same-sex spaces for staff”.
Well, that is good. She talks about the need for adaptation of policies, because current NHS guidance, which goes back to 2019, says:
“Trans people should be accommodated according to their presentation: the way they dress, and the name and pronouns they currently use”.
The Supreme Court judgment sets out the law on this, not just as it is now but as it has always been. It is clear from that judgment that, where single-sex accommodation is provided, the NHS guidance I just referred to puts the NHS in breach of the law. As we know, the Government have said that they are determined to abide by the law. I break in here to point out how welcome that is and what a welcome contrast it is with the behaviour, on occasion, of the previous Government, who I from time to time supported.
There are several examples of unlawful policies being followed by health trusts. Leeds Community Healthcare’s policy says:
“Trans people are entitled to use single sex facilities in accordance with their gender identity”.
No, they are not. I shall not go through more because others want to speak.
One issue is the speed of the change that must now happen. NHS England says that it is reviewing current guidance on same-sex accommodation and, as part of this process, will consider all relevant legislation and the ruling. That sounds a rather leisurely process. How long will it take to adjust this? Specifically, will the Government now contact all health trusts, asking them for an urgent commitment to comply with the law and saying that they need to tell their staff that it is illegal to allow biological men into single-sex female spaces?
A failure to act with speed would lay health trusts open to litigation involving harassment and discrimination. Some of those legal cases, of course, are already under way and will be affected by the judgment, such as Sandie Peggie’s case in Fife—which I know is not within the Minister’s remit—the Darlington nurses and Faye Russell-Caldicott’s case. When money in the NHS is in short supply, as it always is and always will be, we should not be spending it on damages for this sort of thing.
The key issue in all this is that the provision of single-sex spaces is of particular importance to women. This is not surprising, since one woman in four has been raped or sexually assaulted as an adult and 98% of sex crimes are committed by biological men. Victoria McCloud, the retired judge who is trans and says they are taking the Government to the European Court of Human Rights on this issue, says that it is not safe for women to use men’s toilets. It surely follows that it is not safe for biological men to be in women’s toilets.
The solution to this is definitely not that all accommodation should be changed to neutral-sex accommodation. In swimming pool and sports centre changing rooms—a different though related topic—nearly 90% of sexual assaults on women occur in unisex facilities. I do not suggest or believe that this threat comes from trans women, but it would not be progress if unisex facilities became the primary type of changing provision.
An issue that we need to face is enforcement. How will biological men be stopped in practice from using female-only toilets and changing rooms? Asked if the latest guidance meant transgender people would be banned from the lavatories of the gender they identified as, Pat McFadden MP said,
“look, in reality, when you say ban, am I going to be standing outside toilets? I’m probably not. There isn’t going to be toilet police, but that is the logical consequence of the court ruling and the EHRC guidance”.
I think he belittles the effect of law in this country. We want to do the right thing, and by and large we do and will, but it will no longer be possible to be sued for complaining that there is a biological man in a women’s changing room.
I do understand how difficult this announcement of the law will be for some. It will require some biological men who are trans or cross-dressers, and who have previously been using female toilets and changing rooms, now to use male toilets and changing rooms. For some that will cause real problems, but it has to be balanced against the real problems that have previously been created by the opposite practice—that of ignoring the biological sex in favour of the chosen gender identity. The Supreme Court’s judgment was going to cause such problems whichever way it went.
I welcome the clear statement in the judgment of the absolute prohibition of discrimination against trans people on the basis of existing law. All people, whatever their gender identity, should be treated with respect under the law. We will get through this with the kindness, tolerance and respect for others, and for the law and the judges, which have been the hallmark of our country for generations, but which have sometimes been lacking in the debate on this subject. It is time for that to change.
My Lords, it is a pleasure to work with noble Lords today in a slightly different capacity. As I come from a place where we happily worked cross-party, it is wonderful to be here; I bring a slightly different perspective, I think.
The Supreme Court judgment might have brought some aspect of legal clarity, but it has also created significant social uncertainty for trans people. According to my daughter, who is a teacher, it has in many instances brought extreme worry and distress for her pupils; she phoned me at half seven this morning to reiterate that point. In my view, there is a duty of care for His Majesty’s Government to show leadership in helping trans people in the UK to feel safe, no matter the environment or the service, and to feel valued and included.
His Majesty’s Government must engage with the creation of the statutory guidance to ensure that it is fit for purpose, non-partisan and designed to support those who are trying to implement it. They must meaningfully engage with all stakeholders—including, critically, the trans community. In the light of the Supreme Court judgment, do His Majesty’s Government have plans to alter the law so that at least those with a GRC will be regarded as women; and to make provision for those who are non-binary and intersex?
I thank your Lordships for hearing me and for hearing the concerns of my daughter.
My Lords, I thank the noble Lord, Lord Arbuthnot, for tabling this debate. We all know that provisions to maintain relevant spaces as same-sex are particularly important to women because of concerns around safety, privacy, modesty and dignity.
The first point to note for this debate, which is about NHS staff, is that, for workplaces, statutory health and safety regulations require the provision of separate-sex toilets, changing rooms and washing facilities—and have done for several decades. The second is that the Supreme Court’s judgment on 16 April makes it clear that the Equality Act does not give transgender people the right to use opposite-sex facilities. Hence, thirdly, employers who operate policies allowing individuals to use opposite-sex facilities are doing so unlawfully, in breach of their statutory obligations. Can the Minister tell us what the Health and Safety Executive has been doing to enforce the law?
The mystery is why some employers are breaching that clear law and behaving with disdain towards their female staff if they refuse women-only facilities. This is surely the result of a decade of the NHS misinterpreting and flouting the law, as well as the failure by successive Governments to stop it. Unisex alternative arrangements should be available for those who do not wish to use separate-sex facilities relating to their own sex. As the noble Lord stressed, trans employees must not face discrimination or discomfort, but the Supreme Court judgment is the law on access to facilities. As the court made clear, it always has been the law, so why must we spend so much time on this subject?
More importantly, why are women such as Sandie Peggie in Scotland and the nurses in Darlington being put through hell by their NHS employers for having the temerity to request that the law be obeyed and to expect what was once just taken for granted? When the NHS is strapped for cash, as the noble Lord pointed out, why on earth are some trusts prepared to waste money that should go on patients in risking the expense of employment tribunals and other legal actions?
Maybe a clue comes from the motion passed at the British Medical Association’s resident doctors’ branch conference last Saturday; apparently, junior doctors are now called “resident doctors”. This motion not only condemned the Supreme Court’s judgment but called it “biologically nonsensical” because a
“rigid binary has no basis in science or medicine”.
These people are doctors. This attitude could harm not only women and men being treated by such doctors but trans women and trans men, whose biology it is crucial to know for many, if not most, healthcare procedures. This debate is about staff but, if doctors are prepared to deny the rights of their female colleagues, they will certainly not care about patients.
There is widespread bemusement about why women keep having to justify what was once considered ordinary and banal and was accepted in society. For NHS staff, the regulations are clear cut. For patients, the Government need to cancel the famous Annex B and get on with giving patients the single-sex services that they want, alongside decent and fair treatment for trans patients.
My Lords, the fact that we are here today to discuss this subject, against the background of the Supreme Court’s ruling, is a total indictment of the body politic in this Parliament. I served on the then Equality Bill back in 2010, in the Commons. The words in the Supreme Court judgment, at paragraph 264, say that
“the words ‘sex’, ‘woman’ and ‘man’ … mean (and were always intended to mean) biological sex, biological woman and biological man”.
The fact that the body politic as we have known it for many years was incapable of interpreting its own legislation, with all the toxicity that has gone before us and the pain that has been experienced on both sides of this argument, really is an indictment. That is why I support my noble friend Lord Arbuthnot in saying to the Minister that, now that we have this judgment and now that we, the politicians, have been told by the Supreme Court what we actually did in practice—how dreadful it sounds even to say it—I hope that she will act with all speed to make sure that this judgment is expedited with less pain and less discrimination than we have seen in the past 15 years.
Many years ago, back in the 1970s, I worked in an emergency operating theatre. I have been in theatre when we have resected the overlarge liver of a person who needed and wanted to change their sex. As a Member of Parliament, I dealt with many constituency cases, particularly of trans men who had chosen to change into women. I know about and fully support what has happened in prisons and in women’s changing rooms, particularly women’s changing rooms in hospitals, and the way women feel about it—as a woman, I share that feeling—but, when we talk about compassion, my gosh is compassion going to be needed now to make the changes so that this legislation now applies.
That is the responsibility of the Government. I do hope that we are not going to hear them say, “Oh well, health authorities and hospitals can make their own decisions. It is not a matter for Ministers”. Because of the damage that has been caused by our inability, as politicians, to implement our own legislation, we owe this to all the people out there—particularly women but also trans people. People who make that decision are not all rapists. In my experience, the people I have had to deal with sometimes have really quite heart-rending problems and carry those with them, whatever their choice, for the rest of their life, with a level of anxiety that we have to understand. I hope that the Government understand it.
My Lords, I do not know whether I had met many trans people up until maybe two years ago, but, two years ago, our son started his transition journey—at least, that is when we became aware of it. As a result, this afternoon, I speak to your Lordships first as the parent of a trans child. However, I also speak as a proud feminist—something I have been all my life.
I say this because I believe to the marrow of my bones that my feminism and my belief in the rights of trans people are not, and never should be, in conflict. Even as recently as the 1980s, when I was at university, I was told confidently that feminists were not proper women and that, if I went around being—I quote—“strident about women’s lib”, I would never find a husband. Many of the women I knew started conversations with expressions such as, “Of course, I’m not a feminist, but”. I just do not think those things would be said today. Maybe people have just got used to us feminists and do not fear us anymore in the way they once did just because we lived our lives differently from those who were, at the time, the mainstream.
I speak of this today because, even just as a woman, never mind as a proud feminist, I have experience of being part of a section of society that has not only been discriminated against but for which physical safety is always an issue. Even before the issue of these rights became personal because of our son, I would have argued for the rights of the trans community because discrimination is discrimination. There is no hierarchy of protected characteristics. The rights that I have because I was born a woman do not trump those of trans people any more than my rights as a woman are more important than those of the disabled.
The third capacity in which I speak today is as a lawyer. Here, I am afraid, I must disagree with the noble Lord, Lord Arbuthnot, for whom I have the most immense respect. I deeply regret the interim guidance, or update, put out by the Equality and Human Rights Commission last Friday evening—without having consulted anyone, it appears. What the law requires, which remains unchanged by the Supreme Court judgment, is that decisions should be made on a case-by-case basis as to whether there is a legitimate reason to exclude any section of the community from a particular space or organisation and whether doing so is a proportionate way of achieving that aim. That is what the NHS should do, whether in relation to staff, patients or visitors.
The EHRC interim guidance contains inaccuracies and misstates the law. It has marginalised and frightened the trans community. That should be a matter of real concern to any of us who care about the rights and safety of everyone in our society.
My Lords, until the blink of an eye ago, it would have been considered extraordinary to have a debate about whether staff changing rooms in the NHS should be mixed-sex spaces. Many have been unaware of the challenges, including legal challenges, currently taking place in our health system regarding staff single-sex spaces; we are talking about staff with regard to the Supreme Court case. I am grateful to my noble friend Lord Arbuthnot for bringing this debate forward.
As others have said, the Workplace (Health, Safety and Welfare) Regulations 1992 mandate employers to provide separate facilities for men and women, including changing rooms, for reasons of propriety. These rules and the Equality Act have been misinterpreted by the NHS, particularly affecting female employees, who make up approximately 76% of the NHS staff in England. The situation has been confused by the NHS Confederation guidance, which says:
“In all types of workplaces, trans and non-binary people should be supported to use the bathrooms they feel most comfortable using. At no time is it appropriate to force staff to use the toilet associated with their assigned sex at birth against their will”.
Incidentally—as language matters—sex is not assigned at birth. It is observed or registered. It is not a choice.
The guidance also tells management, senior healthcare leaders and HR directors to take a “zero-tolerance attitude” to transphobia. It is this approach which has led to NHS staff facing workplace discipline for asserting their basic rights to privacy and dignity, as well as to single-sex facilities, at work. Although in Scotland, the case of Sandie Peggy, as mentioned before, is particularly egregious: a nurse with a 30-year unblemished record was suspended by NHS Fife after complaining about having to share a changing room with a trans woman. The case continues but, with a budget black hole of £30 million and a cost to the tribunal that must run into hundreds of thousands of pounds, surely NHS Fife should now accept that NHS staff such as Nurse Peggy deserve privacy, dignity and safety, which the original regulations and the Supreme Court judgment have now clarified as it applies to workplaces.
In Darlington, nurses were forced to share the women’s changing room with a male nurse who identifies as a woman. How astonishing it was to hear that, when they raised their concerns, the Darlington nurses were told to “be educated” and to “broaden their mindset”. This focus has meant that sexual harassment in the workplace has been ignored. Managers are no longer offered training on the issues of abuse, which women have traditionally experienced in the workplace. Female staff are leaving as a result, as their concerns, including around bullying and intimidation, are no longer taken seriously.
The current guidance encourages NHS employers to uphold policies that create an intimidating, hostile and difficult environment for staff who do not wish to share single-sex spaces with members of the opposite sex. I ask the Minister to join with Sex Matters, which has written to the chief executive of the NHS Confederation, in urging it that its current guidance is unlawful and should be withdrawn as a matter of urgency.
My Lords, I am involved in the Employment Rights Bill and have been looking to put an amendment to guarantee that all NHS and healthcare employees have the right to access separate-sex changing rooms. Because of the awful experiences of the Darlington nurses and Sandie Peggie in Fife, who were forced to take their NHS trusts to tribunals just to assert their right to get changed in single-sex areas without the presence of male colleagues who identify as women, I had completely forgotten that there are already statutory health and safety laws and regulations that mandate that provision, dating back to 1992. Single-sex changing rooms are also part of NHS England’s good practice guidelines.
It is a story of our times that, right across the NHS, those legal rights have been flouted. The Health and Safety Executive, usually so quick to complain about breaches, has failed to make the law clear or enforce it. Trade unions have stayed shtum. Even worse, it is bad government guidance that has allowed NHS trusts and boards to adopt politicised ideology in the guise of transition at work policies that, I am afraid, have misled trans people by describing privileges as rights.
Now the Supreme Court has ruled with such crystal-clear clarity, you might assume that all private and voluntary organisations, care regulators and, of course, the NHS, would voluntarily want to issue statements making their enthusiastic commitment to implementing the law. Instead, too many are at best fudging and some wilfully misunderstanding the ruling. The problems seem to be that institutions have internalised all these rainbow-badge schemes and the LGBT Consortium and Stonewall’s EDI training, so that unlawful policies are now embraced as kind and progressive rather than unlawful and wrong. Women’s rights have been sidelined as a consequence.
That is why the Government must proactively ensure that NHS bodies act decisively. It should not be left up to Sex Matters to have to write to the likes of Matthew Taylor, CEO of the NHS Confederation and my erstwhile “Moral Maze” colleague, urging him to urgently withdraw guidance that is incorrect and unlawful. Ministers need to help. While the BMA junior doctors have announced that biological sex is scientifically illiterate, I would like to remind them and other trade unions that nursing is a stressful front-line job. What female nurses need is some privacy when getting changed into their uniforms. The last thing they need are some HR apparatchiks denouncing them as bigots, their unions, RCN and Unison, throwing them under the bus, or bosses suspending and shaming them. I think those were the bad old days and I am hoping that, now we have the Supreme Court judgment, the Government will proactively ensure that women’s rights are rightfully restored and nurses can get changed without having to look over their shoulder all the time.
My Lords, I thank the noble Lord, Lord Arbuthnot, for giving us the opportunity to have this important debate. I declare an interest—it is a voluntary interest, so it is not noted by the House registrar. I chair the AMAR International Charitable Foundation. In the last few years, we have given 1 million medical consultations to the Yazidis and 10 million to others. Therefore, 72 primary health centres have been created and I have a deep and sincere interest in the value of nurses, nursing assistants and women health volunteers. I declare that as a real personal interest.
While thanking the noble Lord, Lord Arbuthnot, could I comment that his history is a little out of date? This may be of use to the Minister, because putting this right is going to be a delicate and tricky exercise. In fact, this goes right back to the 1990s, when all Governments were committed—both sides—to single-sex spaces for patients and nurses throughout our hospital systems. That was building absolutely brilliantly until 2008, when very surprisingly something came out from inside the NHS saying, “Oh dear, we are going to be asked to have single-sex spaces and make women nurses-only protections and we are not going to do that. What are we doing to do?” I happened to see that email. That was when this started to be diverted in 2008.
In 2014, the health Act that offered single-sex recognition throughout the NHS was already being undermined by Annex B—which, after all, is only a comment at the end of the annual nursing statement, yet it was given dominance over an Act of Parliament. I can give the detail of that, obviously. My first request is that that particular aspect should be looked at, because an Act of Parliament should surely be dominant, not an additional and internal measure within the NHS—as I would say of any other government department that was allowed to divert and send it into a different channel.
My second point is that I believe that the Minister will wish to review LGBTQ policies. I know well and highly admire Dr Michael Brady, who has been the LGBTQ health adviser. He is a very wonderful, attractive and intelligent man, who has been pushing his cause very hard indeed. But I wonder whether that is a real priority to look at and, perhaps, change, because if it is not, nothing else will shift with any speed at all.
I thank the Minister and the other speakers. This is a very tricky, embarrassing and difficult subject, because so many people feel so strongly that they have been personally affected. I hope that we will all work together to try to make this as good as possible an improvement and recognition of the Supreme Court judgment.
Colleagues, I apologise that I was a minute or two late. Unfortunately, I am disabled at the moment, and everything takes so much longer for me. As soon as I saw that it was a few minutes to 1 pm, I tried to make my way here in time.
I start by saying that I want to endorse what the noble Baroness, Lady Levitt, said. Like her, I have been a feminist all my life—but I am a lawyer, and I am here talking as a lawyer. I actually did the first international case representing a trans woman in relation to discrimination that she had received. As a result, I have had a number of cases since of some significance, relating to the violence that is experienced by trans women, also at the hands of men. Let us be very clear that this is not something that is experienced simply by biological women. The perception of womanhood itself can be enough to enrage certain men.
The judgment makes it clear that the decision was limited to the question of statutory interpretation and that it was not involved in making policy—so the difficult business of policy follows. But the judgment also made it clear, and it was emphasised—although unfortunately this has been lost in some of the utterances by people who should have known better—that its conclusion
“does not remove or diminish the important protections”
that there have to be for trans people and which are available to them under our own legislative commitments. The Supreme Court would probably be rather alarmed at the triumphalism that there seems to be about its judgment.
The Equality and Human Rights Commission is required to publish proposals before issuing a new code of practice and to consult such persons as it considers appropriate. I hope that is going to be really broad, because we have not seen clarity brought by this. We have seen a great deal of dissension and a great deal of fear. I have been contacted by many trans women to say that they felt comforted by some of the legislation that there has been and that they are now full of uncertainty: “What happens if I am caught short at Waterloo station on my way home from work, wearing my female business suit?” That applies especially when we are talking about older women—and we all know that access to facilities can be so important. I am concerned about the consultation process, and I really want to see this being done in the health service as well. There should be opportunities for individuals and organisations to have input into that process—not just the loud voices that we hear and not just those who seem to be very partisan.
One of the things that came with feminism was a belief in our humanity and in the treatment and compassion that we should expect of each other. All that seems to be lost in the toxic debate that is currently taking place. I urge this on the House. I see that the chair of the Equality and Human Rights Commission is here, and I would like to hear her being much more compassionate in how she discusses the rights of the trans community.
My Lords, we are in a mess. We all care about trans people, and we all care about biological women and all the problems that women have suffered over the years. But even as we speak, senior legal officials and estates and facilities managers are racing to draw up proposals for how hospitals, community care centres and GP practices should operate their facilities according to the rules of the Supreme Court. We could, as an interim, ask trans people simply to use a disabled toilet, but all services need to think more deeply about the needs of trans people and cis women—their human rights must be upheld.
What about changing facilities? This was the basis of the much-publicised Darlington case, which was referred to by the noble Lord earlier. That may be trickier and more expensive to solve, where changing facilities have to be allocated by biological sex. From my knowledge of trans friends—who, in the main, just want to quietly get on with their lives as women—the requirement to open changing facilities, and therefore to out themselves, would fill them with distress. That is before you start talking about confronting rights to privacy and dignity. Much has been made of the fear that trans people are experiencing. We do not want to create situations that embarrass, humiliate, out, and create fear in trans people. Their dignity, privacy and human rights must be protected.
There is a little pub just down the road from where we live that has three toilets, labelled “men”, “women” and “inclusive”. Everyone, I hope, will feel comfortable using the “inclusive” option—I know I do. It has the advantage that no one has to out themselves just to go to the loo. There is also the situation of non-binary people, where sometimes it is hard to distinguish the sex of the person. Many trans women accomplish their transition with aplomb and spend their lives as women. I have a friend whom I knew for 10 years before I found out that she was trans—it did not make a blind bit of difference, obviously—but what would happen to them if they were forced to use a men’s toilet? It does not bear thinking about.
I ask that we keep these things in proportion, because half of 1% of people in this country—men or women—is trans. Perhaps we could bear that in mind.
My Lords, I thank my noble friend Lord Arbuthnot for bringing this important debate, and all noble Lords and noble Baronesses who spoke. It is fair to say that this topic has generated a variety of strong opinions on all sides, both in this House and outside. Whatever our opinion, I hope that, in this House and elsewhere, we can approach such a discussion on single-sex spaces and single-sex accommodation with humanity and civility, respecting the dignity of individuals while recognising the concerns that have been raised on all sides of the debate.
In considering the recent Supreme Court ruling on the definition of a “man” and a “woman” in the Equality Act 2010, it is important that we are clear about what it says, so can I check the Government’s understanding of that? Is it true, or is it interpreted, that the judgment defines only a “woman” and a “man” so far as they relate to that specific piece of legislation? Is it correct to say that, although it may or may not set a legal precedent, it does not provide definitive definitions across all areas of law? Can the Minister clarify that?
Before the Supreme Court ruling, the guidance for NHS hospitals required them to accommodate patients based on their stated gender: people were not required to present a gender recognition certificate to demonstrate their preferred gender. Since the Supreme Court ruling, as other noble Lords have said, the Equality and Human Rights Commission has updated its guidance on the provision of single-sex spaces and has specifically stated that the NHS has to update its policy. We looked for information on the NHS website and it is not available at the moment. Can that be taken as a sign that the department or NHS England is updating that policy? That is my second question to the Minister: is the NHS currently updating policy on who can be accommodated in single-sex wards in hospitals? If it is doing so, can she share with the Committee any details as to what that updated guidance might look like, or is it too early to say? Maybe her officials can help.
The real issue here is how the NHS can ensure that it strikes a careful balance between complying with the Supreme Court judgment and the guidance from the EHRC protecting the rights of women, and ensuring that all patients, whether they are transgender or not, are treated with the dignity they deserve. I look forward to the Minister’s response.
Before the Minister stands up, we have the benefit of having the chair of the EHRC in the Room with us. I wonder whether it is your Lordships’ wish that we hear from her.
My Lords, I am in the hands of the Committee, but the fact is, as Members will know, people are entitled to ask to speak in the gap, but the gap had already been passed by the time the Member concerned sought to do so. I can say no more at this stage.
My Lords, this is a timed debate and people have quite rightly put their names down for it. As the Deputy Chairman of Committees said, the gap has already been passed and I suggest that we move on to hear from the Government Front Bench.
My Lords, I thank the noble Lord, Lord Arbuthnot, for bringing this issue before the Grand Committee, and all noble Lords, particularly the two Front-Bench spokespersons, for the tone, which I also wish to impart to this important debate. A noble Lord said that we want to do the right thing, and I endorse those words. We heard a call for kindness, compassion and common sense throughout; again, that is absolutely the hallmark of how the Government are approaching this. Last but not least, I thank my noble friends Lady Griffin and Lady Levitt, who were kind enough to bring their own experiences and that of their families into the Room. It is always so important that we remember that we are talking about people here.
I say at the outset that the Government believe that NHS staff deserve to be treated with dignity and respect at work. This includes providing single-sex spaces. The noble Baroness, Lady Fox, set out that position very clearly. The Supreme Court has now ruled that sex means biological sex in the Equality Act, and with regard to the legal definition of a woman for its purposes. I heard the frustration of the noble Baroness, Lady Browning, that this was required, but the ruling brings clarity and confidence. It says to service providers and others that they must follow the judgment. That is the guiding light: this is the law, and we expect all public service bodies to comply with it. I can assure noble Lords that the Government are looking at ways to support public bodies in doing so.
I want to state clearly that trans people must have access to the services that they need in the broadest sense, and that they are also provided with protections under equality law. Access will need to be in line with the law.
I heard my noble friend Lady Smith of Basildon, the Lord Privy Seal, say on BBC Radio 4 recently that there is nothing that cannot be dealt with, with kindness, compassion and a bit of practicality and calmness—I emphasise that last word. In a practical sense, dealing with matters of access, many examples of which have been raised in this debate, may not be the same in all circumstances, and relevant organisations will need to look carefully and sensitively at these issues. I appreciate that implementing changes may generate some operational challenges and have financial implications, but, in my view, it is not beyond the ability of the NHS to find a path through that resolves these issues in a way that ensures the safety and dignity of patients and of staff. Noble Lords have rightly paid tribute to the work that staff do, and we are absolutely here to respect and support them.
The Equality and Human Rights Commission has committed to issuing a new statutory code of practice, and all service providers would be expected to comply with it. On the EHRC, which my noble friend Lady Levitt in particular drew attention to, it is, as we know, an independent body. To remind us, it has
“the responsibility to encourage equality and diversity, eliminate unlawful discrimination, and protect and promote the human rights of everyone in Britain”.
As I mentioned, in the light of the judgment, the EHRC has committed to produce an updated code of practice by the end of June for ministerial approval—I heard many calls for ministerial involvement, and I hope that that response will be helpful—following a public consultation. The EHRC update that noble Lords have referred to is interim and provides its reflections on the Supreme Court ruling. I wish to emphasise to my noble friend and noble Lords that it is not official guidance at present, but I reiterate that employers and other duty bearers have to follow the law and should take appropriate specialist legal advice where they need to. I hope that will be helpful, and I am sure that my noble friend will engage in the consultation on this important matter.
The noble Lord, Lord Arbuthnot, and the noble Baronesses, Lady Ludford and Lady Jenkin, referred to the Darlington nurses. I am sure that noble Lords understand that I will not go into the detail of that specific dispute, as it is an ongoing legal matter, but I can confirm that the Secretary of State, Wes Streeting, met with representatives last year and has been in further contact with them since to understand any further concerns. As I have already said, the Government have called for, and continue to call for, the protection of single-sex spaces based on biological sex. The ruling provides added certainty—I will put it that way to the noble Baroness, Lady Browning—on this matter, and Darlington Memorial Hospital, along with all other public service providers, must comply with the ruling.
The noble Lord, Lord Arbuthnot, reference to the matter of single-sex spaces for patients, although the debate relates to staff. The core principle governing this issue is that providers of NHS-funded care should have a zero-tolerance approach to mixed-sex accommodation, except where it is in the overall best interests of all patients affected. The reason for saying that is, of course, that there can be times when there is so much pressure on accommodation that there has to be common sense and flexibility in the interim. This aligns with the NHS constitution, in which the NHS pledges that patients admitted to hospital
“will not have to share sleeping accommodation with patients of the opposite sex”.
Fundamentally for me, as the Patient Safety Minister, this issue affects some of the most vulnerable patients, such as those in mental health settings. It is imperative that we get this right to tackle sexual harassment and violence in hospital care settings, for which we also need zero tolerance.
The noble Baroness, Lady Browning, the noble Lord, Lord Arbuthnot, and others raised the pace of change. NHS England is revising its guidance in line with the ruling, and this will be done in a way that respects the dignity and safety of trans patients, as well as of women. I make this point particularly as the noble Baronesses, Lady Ludford and Lady Nicholson, referred to guidance; this is how it will be dealt with. The intention, confirmed by the Secretary of State, is that the NHSE guidance will be published before the summer. I assure noble Lords that we will work with NHSE on this, and that any guidance will need to align with the EHRC’s statutory code of conduct. Noble Lords will understand that a number of points are coming together.
I would very much like to pick up some of the points that noble Lords were good enough to raise. My noble friend Lady Griffin asked about those who have a gender recognition certificate. Trans people are protected from discrimination and harassment in the Equality Act. That does not change. Those with a GRC are still recognised in their acquired sex and gender in other circumstances, unless specific exceptions apply.
The noble Baroness, Lady Ludford, asked about the Health and Safety Executive in respect of employers that may be operating unlawfully. I simply emphasise that all providers have to follow the Supreme Court ruling.
The noble Baroness, Lady Jenkin, referred to NHS Confederation guidance, and there was reference throughout, in addition to the Darlington nurses, to the Scottish case of Sandie Peggie. I know noble Lords understand that it is not possible for me to comment on that case. However, on guidance, the noble Baroness, Lady Jenkin, simply demonstrated the need to get language right throughout. That is exactly what will happen.
My noble friend Lady Kennedy raised a number of cases of violence towards trans women, often by men. How we protect trans people from hate crime is a very important point that we must be very aware of and alert to, and act on. Strong protections remain in place for all communities to live free from discrimination. There is zero tolerance for hate crimes of any kind, and we will support the police in taking the strongest possible action against perpetrators of these abhorrent offences.
The noble Baroness, Lady Burt, and my noble friends raised concerns about the fear that trans people are facing. There are rightly laws in place to protect trans people from discrimination and harassment. I want to acknowledge—the noble Lord, Lord Kamall, made this point well—that, although those laws are in place, I am absolutely aware of their fear, uncertainty and concerns. This is not a situation that we would wish to continue; dignity and respect for everyone must run throughout.
The noble Lord, Lord Kamall, asked what the guidance on single-sex wards might look like. We will update those policies, and their detail is receiving a lot of attention. I cannot comment on the specific details, but I look forward to the noble Lord and your Lordships’ House being made aware of what is in that guidance. We are always open to improvement.
I thank noble Lords for their contributions and the noble Lord, Lord Arbuthnot, for instigating this debate. I look forward to working on it further.
(2 days, 7 hours ago)
Grand CommitteeTo ask His Majesty’s Government whether they will consider using frozen Libyan assets to provide compensation to victims of IRA terrorism.
My Lords, I welcome the opportunity to have this debate. I welcome all the Members who are here; one or two said to me that they would have liked to be here, but they had to be in the main Chamber. I know that everybody here has real expertise in this area but, if noble Lords will forgive me, I will put a bit on the record around the history of this issue, otherwise, it will be out of context.
We are all aware, I think, that the role of the Libyan Government in supporting the terrorism of the Provisional IRA cannot be overestimated. When he was the Foreign Secretary, the right honourable Jack Straw told a Select Committee that
“in the 1980s and early 1990s, Libya was probably the most serious state sponsor of terrorism in the world”.
Throughout those two decades, the Gaddafi regime supplied arms, funding, training and explosives to the IRA, which without doubt helped to prolong the terrorist campaign. At least 10 tonnes of Semtex were shipped to the IRA during that time. We saw the result in Northern Ireland, with bombs such as those in Enniskillen, which killed 12 people on Remembrance Sunday; in Lisburn, which resulted in five victims at a regular Army fun run; on the Ballygawley bus, which killed eight off-duty light infantry soldiers; in the Shankill Road fish and chip shop; and many more.
In Great Britain, we saw the Harrods bombing, the Baltic Exchange bombing, the Manchester bombing and, of course, the Docklands bombing. This atrocity resulted in the setting up of the Docklands Victims Association. It is chaired by Jonathan Ganesh, who was himself badly injured by that bomb and who has since been a stalwart of the campaign for justice. He has worked with victims’ groups in Northern Ireland—especially the South East Fermanagh Foundation, or SEFF, led by Kenny Donaldson.
Victims and their families have struggled for justice for over two decades. It began in 2006, when litigation by British lawyers commenced in the United States, with 153 pioneer victims. In 2008, proceedings issued against the Libyan External Security Organisation, Gaddafi and four individual agents of the Libyan Government for damages arising from the Gaddafi regime’s material support of Libya/PIRA terrorism were stayed as part of the US-Libya claims settlement agreement, which had the effect of staying all litigation on both sides and setting up a humanitarian fund, into which Libya paid £1.5 billion to settle all claims.
The pioneer victims were overjoyed at the prospect of closure. However, as further details emerged, it transpired that the fund would be available only to US and Libyan citizens. Only three of the 152 victims, who were US citizens, received substantial damages. That devastating situation remains unresolved today. In fact, it was later leaked that Her Majesty’s Government, as they then were, were aware that the US-Libya deal would exclude UK claimants but considered the disparity in the issue not worth pursuing for risk of upsetting the UK-Libya détente, which involved improved relations in trade and security.
Despite the setback, the campaign continued. At the start of the Libyan revolution, victims of the bombings and the then internationally recognised Libyan transitional Government signed the Benghazi agreement. Under this agreement, binding their successors, the transitional Government agreed to pay parity compensation to the pioneer victims, as well as a separate sum to the non-pioneer victims in Northern Ireland for community reconciliation.
However, despite diplomatic efforts and public warm words, successive Libyan Governments have failed to satisfy any terms of the Benghazi agreement. Subsequent Governments from all sides have failed to exert promised diplomatic pressure to secure payment from Libya. When the Libyan assets were frozen, there was, disappointingly, no mention from our Government of raising the issue of compensation. Successive Governments have failed to deliver to the victims.
In 2017, after years of Libya failing to satisfy the agreement, the Northern Ireland Affairs Committee, of which I was a member at that time, concluded that His Majesty’s Government should enter direct negotiations with Libya to seek compensation. Any of us who heard the evidence given to the committee will know that it was very harrowing. It was apparent that something at the back of this was stopping Governments of all persuasions from pushing to get compensation. I urge anyone listening or watching who wants to understand the issue more to read some of the evidence, particularly the evidence concerning Mrs Gemma Berezag, who cared for her husband, Zaoui, who was gravely disabled. She had such a hard time, eventually having to change his nappies 10 times a day. She was so distressed by the whole thing that, 20 years after the bomb, she committed suicide. Her family wanted this to be in the public domain.
Aileen Quinton, in evidence to the committee, talked about how her mother was killed at Enniskillen and how Foreign Office officials did not help. The G8 was held in Enniskillen and the Libyan Prime Minister came. The victims heard about this, although no one told them officially. They had hoped that they would be able to meet him. Aileen said that it was astonishing that they were not told about it. Later, after they agreed that they could not meet him because no arrangement had been made, they got an email from the Foreign & Commonwealth Office, which said of the Libyan Prime Minister’s visit:
“We are sure some of you will be disappointed, but hope you will consider it positive that he met with Northern Ireland leaders”.
As Aileen said, considering that one of those leaders was Martin McGuinness,
“when it has been said in the media about the potential for his involvement in the bomb, and we were expected to find that positive, it was absolutely heartless”.
Those people were diplomats, so the Foreign Office has not exactly reached out over the years.
Gordon Brown has been the best Prime Minister on this. He set up a unit to look into things and to bring people together. Sadly, it was disbanded. Then, in 2019, Sir William Shawcross was appointed as a special representative on UK victims of sponsored IRA terrorism. He did a report scoping the possibility of compensating victims that was delivered to the Government in 2020, but its contents are unknown. It suddenly became a security risk to release the report. No one has seen it. Sir William said how disappointed he was that victims were not able to see his report. If there are security problems in it, they could be redacted, so I urge the Minister to answer again on why this will not be reported.
To return to the present day, the world has changed. All the reports were from an era before Russia invaded Ukraine. At that time, confiscation or repurposing of sanctioned assets was unpopular. Recent developments have forged legal pathways to using extraordinary revenues generated on sanctioned assets—crucial in a time of dwindling economic reserves and pressing global humanitarian concerns. We all know that the UK has committed to providing a £2.26 billion loan to bolster Ukrainian defence capabilities, confirming that it
“will be paid back using … profits generated on sanctioned Russian sovereign assets”.
Parliament passed the Financial Assistance to Ukraine Act 2025. This represents a clear clarification that extraordinary revenues generated on sanctioned assets can be utilised and confiscated—or repurposed, as legal people sometimes say—for humanitarian and other human rights purposes. We have seen the EU change its regulations to provide the legislative basis for the provision of the EU loan.
So there is a way forward. The UK has plainly acknowledged that the use or confiscation of extraordinary revenues generated on Russian assets is in accordance with international law. This has been carried through by many lawyers, who are now saying exactly the same thing. The Prime Minister will have had a letter from legal representatives, which I am sure has been shared with other Ministers, including the Secretary of State for Northern Ireland. That letter is very clear on the way forward.
In light of all this, His Majesty’s Government should urgently facilitate the use of the accrued interest and any other revenues generated on Libyan frozen assets in the UK to fulfil the purposes and objectives of the Benghazi agreement, as well as the recommendations of the Northern Ireland Affairs Committee. His Majesty’s Government could do this in several ways, not least by applying the precedent set on the issue of Russian sovereign assets. The reaffirmation in international practice set by the use of frozen RFSA underpins and provides more substance to being able to do this.
Further grounds exist because of the Benghazi agreement; there has been an agreement about this. Russia did not have to agree to what happened to its assets, but Libya agreed in the Benghazi agreement. To the extent that the Benghazi agreement binds successive Libyan Governments, it expressly—or, alternatively, tacitly—provides their past and current consent. There is no doubt now that there are no valid legal reasons that the proposals put forward to the Prime Minister by the victims’ legal representatives cannot be met. In fact, that letter has not been replied to, which is surprising, given that it was sent in March.
Everyone knows now that using international law has been a smokescreen to avoid finally granting justice to those 1,000 or so victims. There is a pragmatic solution to end this injustice, and the Government should now seize the window of opportunity to make it happen. As someone else said—I am going to repeat it—what is good for the Russian goose’s assets is good for the Libyan gander’s assets. Without His Majesty’s Government’s action, victims may be forced—this is a real possibility and the work is already happening—into adversarial and protracted legal action against His Majesty’s Government, Libya and the Provisional IRA, as set out in Annex 2 to the letter to the Prime Minister.
The proposed solution is neat, simple, in line with current HMG legal and political thinking on the confiscation of frozen assets for Ukrainian reparations, and provides a positive opportunity not only for HMG leadership but for UK-Libya relations. Will the Minister please explain why this will not be looked at deeply and sensibly by His Majesty’s Government? Will they put one Minister in charge? This has been dealt with by all sorts of different departments. People are having their expectations raised and then demolished. Given that the Attorney-General is presumably giving advice on this but has previously been involved in a Libyan case, can the Minister tell me whether he is now excused from that?
Those are my main points, delivered much more quickly than I had hoped.
My Lords, I express my support for the sentiments expressed in the fine speech by the noble Baroness, Lady Hoey. I have two interests to declare. First, the Brown Government—the noble Baroness, Lady Hoey, referred to the serious attitude taken by that Government—set up an all-party delegation to Libya, of which I was part. Part of what I will say is based on that but, admittedly, it was more than a decade and a half ago.
Secondly, I am currently involved in a project for an official history, which the noble Lord, Lord Caine, did noble work on in the previous Government. I am glad to say that the right honourable Hilary Benn, the current Secretary of State, is continuing the work. I will not be doing the research, but I am a strong supporter of the belief that it is very much in the interests of the people of Northern Ireland for His Majesty’s Government to open the archives as much as possible and reveal the truth about the past. I will come back to that at the end. Yesterday, Kneecap were raised in the Chamber. I was in this case a premature anti-fascist, to use that phrase, and first raised the issue of official support for Kneecap some weeks ago in the Chamber. I hope there is a way of doing something about compensation for the many victims in this country, particularly in London, and in Northern Ireland. One thing can definitely be done: we could have more truth about what actually went on.
When I was in Libya, we met Libyan government Ministers and discussed quite a bit with officials. I remember that, even at that point, it was clear that our officials did not really believe that there would be any compensation and the best that could be hoped for was that, in a time of better relations with Libya, there would be strengthened economic ties. For example, because I was an academic, there was a lot of discussion with me about what could be done to get more Libyan students to come to the United Kingdom. That was seen as the way forward, rather than a payment in recompense for the horrible crimes committed with Libyan assistance. It was very clear to me, even then—and, to be honest, consistently throughout—that there has been little official belief in the desirability of delivering compensation, although many people have pressed for that with great zeal. There were hints of this even while I was in Libya—I do not think I am really betraying anything now. Even then, it was clear that, in that new era that had already begun, the relationships between our Government and Libyan intelligence were quite close. At the end of the Gaddafi regime in 2011, Moussa Koussa, famously the head of Libyan intelligence, basically collapsed into the arms of the British state for protection.
There is a crucial question here. A significant part of the IRA leadership was in Libya for a long time. It was negotiating the transfer of these weapons. There is a fair amount of speculation on various issues, including who the individuals were. Did our intelligence service ever ask Moussa Koussa, who at that point was on his uppers and relying on us for protection, what happened in the days when he was providing the weaponry? Do not forget that one consignment of the “Marita Ann” was interrupted because of the work of Sean O’Callaghan, but the main consignment of weapons came through. There is all the endless tedium of the decommissioning issue, which took up the lives of a number of people in this room in the early part of this century, and the decommissioning of the weapons that Gaddafi provided. The IRA was armed as if it was more or less a full-scale army. In some ways it became inhibiting, because it was not a full-scale army, and these great stockpiles of weaponry lay in Kerry as a kind of reproof: “Why aren’t you doing more? Why can’t you do more?” I have been told by republicans that there was a strange psychological effect.
However, lots of people died as a result of this weaponry and these explosives, particularly the Semtex. There are questions here. What do we know about it? Who collected it? Who was there? Who is still active in public life in Northern Ireland and these islands? What role did they play? Did we even bother to ask Moussa Koussa, at a time when he very much owed a debt to the British state, which protected him physically in the final crisis of the regime? I do not know, but it is a fundamental test for the official history and people such as me who have argued for this and have been told all along by cynical voices in Belfast, “You will never get the truth. They will hold back the documents”. I again repeat my very deep thanks to Hilary Benn and his team for deciding to go ahead with this project. I will not be working on it, but one of the big tests for the official historians who do is this: will they actually be told what happened? We may not be able to provide recompense, but we should be able to tell people a lot more about what actually happened. The truth matters.
At the weekend, a great friend of mine, an Irish commentator, talked about how sections of Northern Irish opinion—those sections that admire Kneecap, really—were being grabby. We have seen, by the way, the speed with which Kneecap are moving to preserve their income from these concerts. I am delighted to see that the old Irish entrepreneurial spirit is not dead. Having said that I am impressed by that, the other point made by my friend Eoghan Harris was that, in the north, sections of the community had lost their moral compass. One means of restoring a moral compass is that the truth be told about these matters as well as—I am a former historical adviser to the Bloody Sunday tribunal—things on the part of the British state that are not so attractive. It, equally, has to be done.
However, to say that we must release all the documents on Bloody Sunday—I totally agreed with that and was involved in the work on it—and then to say that we cannot possibly tell you what really happened in Libya, even though we have every reason to know all about it, under the circumstances that eventually ensued, would be a double standard that would not actually help people.
Yesterday, the House was generally united. How can Kneecap be so crass as to think that these things about killing MPs and so on are okay and acceptable? Trust me, that type of crassness is widespread in Northern Ireland. It is not a mystery; it would be a surprise if there was any sense of moral scruple, not the other way round, in the sentiments expressed. Even to name the group after the authoritarian act of a paramilitary elite going around shooting teenagers in the knees in Belfast who had got on the wrong side of them—no doubt some were petty criminals—tells your Lordships everything they need to know. My friend at Queen’s, Professor Liam Kennedy, was very clear about that. It is not a surprise.
Arising from this debate at least we have a chance to strengthen the work of the official history and to put down a marker. As I said, there should be no double standards in the delivery of truth. When it is embarrassing to the UK Government, it should be delivered. In this case, when it is more likely to be embarrassing to other people, it should also be delivered. The capacity clearly has to be there—or, just possibly, nobody bothered to ask.
I thank the noble Baroness, Lady Hoey, for securing this debate. This subject has been going around Parliament now for many years.
I have had the privilege of being a member of a parliamentary group that tries to represent the interests of the victims of Libyan-supplied weaponry to the IRA. It is ably chaired by Andrew Rosindell MP. We have seen successive Foreign Secretaries, Treasury Ministers and officials, but the first and only time we felt that we were making some progress was actually when Boris Johnson was Foreign Secretary and he agreed to appoint an envoy. The expression on the faces of the Foreign Office officials sitting beside him told us that this was probably something that he had gone off and done on his own, but he then left the post and was replaced by Jeremy Hunt. Six months later, he came up with the Shawcross proposal, which has gone into the sand and remains top secret. The Treasury officials were the same.
That group does not believe that the UK taxpayer should be paying compensation to the victims of Libyan-supplied weapons. The state of Libya, with Gaddafi as its president, decided to supply arms and weapons to a terrorist organisation operating in the United Kingdom. There is a clear, unambiguous line of responsibility from start to finish. Those weapons did a lot of damage in Great Britain and in Northern Ireland and without them, the IRA would not have been able to prosecute its campaign in the latter part of the 1980s and 1990s. It was the jewel in their crown.
There are ways of using the frozen money—we have talked about this with officials—to build up schemes to ensure that revenue is provided to help victims. We will not go into the detail today, but if the Russian experience that we are going through at the moment had occurred when we were trying to make progress, we would have got a lot further. The Minister has to understand that the response has been a brick wall, not just from his party but from all parties.
Many believe that Tony Blair persuaded Gaddafi not to develop nuclear weapons: the deal in the tent, there was some kind of payback. Your Lordships may remember Operation El Dorado Canyon, when Ronald Reagan used UK airbases to bomb Libya. That incentivised Gaddafi to do even more. With the “Eksund” and all the other things he did, he supplied a massive amount and was the engine room for the IRA in that period.
I would say to the Minister that we talk about international law and the order—what order? Virtually nobody is paying any attention to it except us. The Chinese are not interested, the Americans are not interested, Russia is not interested, Iran is not interested. Who? These people in the state of Libya took a political decision to effectively attack the United Kingdom, and did it very effectively. Under these circumstances, we would be operating in the interests of our own people to ensure that we get as much compensation for these people as possible. They have suffered terribly. Other people have got it. It is not a case simply of finding that chicken nuggets in some eastern European country are not as acceptable as chicken nuggets here. That is the sort of trivia that we have reduced ourselves to in the courts. So I hope that the Minister can take seriously back to his department the idea that we can do this but the UK taxpayer does not have to bear the burden. On that, I think we can all agree.
My Lords, I begin by thanking the noble Lord, Lord Bew, for his kind comments about the public history. He will know that it was certainly my intention that the historians involved would have full access to the papers, and I assume, with the welcome news that this will now go ahead, that that is still the case with the current Administration.
I also express my profound sympathy for all those whose lives were affected by terrorist atrocities during what we somewhat euphemistically refer to as the Troubles between 1966 and 1998. I place on record once again that terrorism in Northern Ireland, from whatever part of the community or political tradition it came, was always wrong and could never be justified. As somebody once put it, there was not a single injustice in Northern Ireland, either perceived or real, that warranted the taking of a single life. I totally agree with that. More than 3,500 people were killed, and we should never forget that, with many thousands more injured and maimed, and that continues to cast a very dark shadow over society today.
I also restate the enormous debt of gratitude that we all owe to those who served in Northern Ireland, be it in the police, the Armed Forces or elsewhere, to ensure that terrorism ultimately did not succeed and that the future of Northern Ireland would only ever be determined by democracy and consent, something that is at the very heart of the 1998 agreement.
Central to the discussion we are having today is the legacy of those terrorist attacks committed by the Provisional IRA as a result of the substantial support that it received from the Libyan regime of Colonel Gaddafi, all of which has been widely documented. I am grateful to the noble Baroness, Lady Hoey, for bringing this debate to the Committee today, as it is very important. Libyan support for the IRA began in the early 1970s, fell away in the late 1970s but resumed in earnest in the early to mid-1980s, as Colonel Gaddafi saw it as a means of striking at Britain, which at that time was, along with our allies in the United States, a staunch opponent of his evil regime. My noble friend Lord Empey touched on the events of 1986, when UK bases were used to launch attacks on Tripoli.
As the noble Baroness, Lady Hoey, mentioned, the support of Libya for the IRA included millions of dollars of finance, weapons and ammunition, including hundreds of AK-47 rifles, submachine guns and SAM-7 missiles, high explosives, most notably Semtex, and military training. It reached a peak with four direct arms shipments that landed on the coast of Ireland in the mid-1980s, before the interception of the “Eksund”, with its vast arsenal of weaponry, in November 1987. That interception was a pivotal moment in the history of the Troubles. It is something on which I could probably speak for at least the next hour, but in the interests of time, I shall resist.
There is no doubt, therefore, that Libyan support helped to maintain the IRA’s capacity to carry out deadly terrorist attacks across mainly Northern Ireland but also other parts of the United Kingdom, as the noble Baroness again set out, at a time when other sources of weaponry, including the United States, were drying up—that is crucial. That Libyan support came at a crucial time for the Provisional IRA. As my noble friend Lord Empey made clear, it is almost certainly the case that every IRA atrocity, from the mid-1980s up until the second ceasefire in September 1997, had a Libyan connection. It has been estimated that the shipments and support from Libya in the mid-1980s would have enabled the IRA to sustain a campaign for around 20 years—but, thankfully, other factors intervened and a political solution was eventually found.
It is, of course, therefore completely understandable that victims who suffered from the effects of the weapons and financial support for the IRA from the Gaddafi regime over many years want to see compensation. This is an issue with which the Government in which I served as an adviser, and latterly as a Minister, grappled over many years, including by asking Sir William Shawcross to conduct an internal scoping review into the matter in 2019, as has been mentioned. This was subsequently delivered a year or so later.
Without pre-empting what the Minister might say in his reply, I am aware that there are several very important legal issues arising from the use of frozen Libyan assets to compensate victims. As was outlined in a written statement on the Shawcross review in March 2021 by my right honourable friend James Cleverly, under current international law when assets are frozen they continue to belong to the designated individual or entity. He said at the time:
“Frozen assets may not be seized by the UK Government”.
Currently, in implementing financial sanctions, the UK is obliged to comply with relevant UN obligations. This does not mean, however, that there are no avenues available to seek compensation. I shall make two main—hopefully brief—points. First, I agree with my noble friend Lord Empey that the responsibility for providing compensation for the actions of the Gaddafi regime lies with the Libyan state. Can the Minister therefore set out what actions His Majesty’s Government are taking to press the Libyan authorities to address the Libyan state’s historic responsibility for the Gaddafi regime’s support for the IRA? Will the noble Lord commit to continuing in earnest the previous Government’s efforts to secure this redress, notwithstanding some of the practical difficulties—of which I am all too aware—including where actual authority in Libya might rest?
Secondly, is there not now an opportunity to take a fresh look at the issue of frozen assets, as the noble Baroness made clear? I admit that, when I was in the Northern Ireland Office, I shared the frustration of many at the rigid and perhaps overly legalistic approach adopted by colleagues in the Foreign Office. But I wonder whether the war in Ukraine has not helpfully moved the discussion forward. After all, as the Defence Minister, Luke Pollard, confirmed in March, the UK Government had to date used £2.26 billion of interest from sanctioned Russian sovereign assets to source military capabilities for Ukraine. Meanwhile, on 22 April, the Secretary of State for Defence, John Healey, confirmed that
“whether we can make any further use of the seized Russian … assets is something we are looking closely at”.—[Official Report, Commons, 22/4/25; col. 929.]
Clearly, a good deal of thought is being given within government to the commitment in the Labour manifesto to
“work with our allies to enable the seizure and repurposing”—
I emphasise that word—
“of frozen Russian state assets to support Ukraine”.
I therefore press the Minister for a similar approach to be taken in respect of the £12 billion or so of Libyan frozen assets. If it cannot be, why not?
Of course, no amount of financial compensation can ever make up for the loss of loved ones or alter the changes made to the lives of those affected by these attacks. I do know, however, not least from my own extensive engagement with victims and survivors in Northern Ireland, that recognition of the suffering felt by so many communities is terribly important.
There are, of course, several other schemes that deliver compensation for those affected by the Troubles. Very briefly, these include the Criminal Injuries Compensation Scheme and the Troubles Permanent Disablement Scheme, legislated for by the previous Government in 2019, which since August 2021 has been delivered by the Northern Ireland Executive. Will the Minister say what conversations his Government have had with the Executive on issues of support and compensation, and is he in a position to provide an update on these schemes? If not, perhaps he or one of his colleagues would write to me on that subject.
I want to close by reiterating that it is the victims of terrorism who should always be at forefront of our thoughts. I hope that the Government continue to build on the momentum of this debate, take note of its content and return to us in good time with concrete updates on their work to secure redress for those communities that suffered so badly as a result of the Libyan regime’s support for terrorism. But let us not forget that it is those who pulled the triggers and planted the bombs who bear ultimate responsibility—in this case, the Provisional IRA. I wish the Government well in their efforts.
My Lords, I am extremely grateful to the noble Baroness, Lady Hoey, for asking this Question for Short Debate. I agree very much with the noble Lord, Lord Caine, that the terrorist actions of the IRA could never be justified. Therefore I begin by reflecting on some of his points and by reiterating that this Government have profound sympathy for UK victims of Gaddafi-sponsored IRA terrorism, as well as all victims of the Troubles. I know from personal experience as a union officer visiting Belfast throughout the 1980s and 1990s just what that terrorist action caused and the impact it had, but I cannot imagine the pain and suffering that the victims had to endure. I had the benefit of being able to get on a plane and leave but they could not, and that is a really important point.
I hope that the Government’s support and compensation, through the Northern Ireland Executive and the Troubles Permanent Disablement Scheme, is of at least some help. In answer to the noble Lord, Lord Caine, I shall ensure that officials write to update him on all the elements of the compensation schemes.
When it comes to getting compensation from Libya, I believe that it is important to distinguish between securing compensation for actions where Libya was a third party and the actions directly carried out by Libya. I do not think that we should ever forget who is responsible for the terrorist actions in Northern Ireland: they were carried out by the IRA. Victims of direct attacks such as Lockerbie and the killing of WPC Fletcher have received compensation—but I repeat that the primary responsibility for Gaddafi-sponsored IRA terrorism lies with the IRA itself. However, the extensive support by the Gaddafi regime, as the noble Lord, Lord Caine, and the noble Baroness, Lady Hoey, made clear, through money, weapons, explosives and training, from the 1970s onwards, undoubtedly enhanced its capacity to carry out attacks in Northern Ireland and, of course, the rest of the United Kingdom.
Responsibility for compensating victims specifically for the actions of the Gaddafi regime rests, as the noble Lord said, with the Libyan state. That is why, in 2011, thanks to a UK initiative, the UN Security Council adopted resolutions 1970 and 1973, which froze Libyan assets to help end the brutality inflicted by the Gaddafi regime on the Libyan people. Nor should we forget that the Libyan people suffered hugely under the actions of that dictator. What those resolutions sought to do was to give the people of Libya the opportunity to determine their own future. These assets have remained frozen to prevent their misuse, with the aim of preserving them for the future benefit of the Libyan people.
Over time, as we have heard in this debate, there have been calls to use these assets to compensate victims of Gaddafi-sponsored IRA terrorism. But, as in the UN resolutions, those assets must be used in line with our UN obligations, which are specifically for the future benefit of the Libyan people. In fact—this is a point I want to stress—it helps the UK’s ability to support Libya’s transition to a democratic, independent and united country. I think we should stress that a united, independent, democratic country is about the future security of this country and of Europe. It is a vital component of our actions in relation to the future of Libya. A politically stable and unified Libya would be better positioned to address the legacy of the Gaddafi regime.
Additionally, seizing frozen assets would hinder international efforts led by the United Nations to achieve that objective of a united Libya, which can work with British victims to address compensation claims. That is why, regrettably, these frozen assets cannot be used to provide compensation for victims of Gaddafi-sponsored terrorism. There are also significant practical difficulties that exist in obtaining compensation from the Libyan state, due to the current political and economic fragmentation and instability. But I reassure the noble Lord, Lord Caine, that the United Kingdom will continue to urge the Libyan authorities to address the compensation claims of British victims. We will remain focused on supporting UN-led efforts to achieve stability and unity.
I would also like to address the proposal to use tax. People have mentioned the G7 efforts, and even that is quite complicated, as the noble Lord, Lord Caine, pointed out. For example, the UK tax collected on frozen assets goes into the Government’s consolidated fund, which is used for essential public services. The real issue is that diverting these vital public funds would not hold the Gaddafi regime accountable for supporting the IRA.
Let me also address concerns raised by the noble Baroness, Lady Hoey, and the noble Lord, Lord Bew, about the Shawcross report. Since its completion under the previous Government in 2021, there have been consistent calls for its publication from victims, their representatives and parliamentarians. This Government understand the public interest in this report and the previous concern regarding transparency on the issue.
We are actively considering whether elements of this report can be published. As the noble Lord, Lord Caine, pointed out, as this report was commissioned as an internal document to provide advice to Ministers and draws on private and confidential conversations, its release would have damaging implications for the UK’s national security and international relations. Therefore, this process is not straightforward. But I know that it is important, as the noble Lord, Lord Bew, indicated, that to be as transparent as possible with the public it is better to explain the difficulties and complexities behind the issues. This includes the challenges of obtaining compensation from a divided and fragmented Libya, and defining the parameters for identifying the British victims of Gaddafi-sponsored IRA terrorism and how this report adds to the wider debate on support for people who have lost loved ones during the Troubles. That is why I reiterate that this Government are committed to being as transparent as possible over this issue.
The noble Baroness, Lady Hoey, mentioned the letter written from representatives of victims of Gaddafi-sponsored IRA terrorism to the Prime Minister. It has been received, but it requires cross-Whitehall consideration. That is being given, and the Government will respond to it as soon as possible. Let me reassure her and other noble Lords that Hamish Falconer, the Minister for Middle East, North Africa, Afghanistan and Pakistan, wrote to some of the victims and their families earlier this week. He has extended an invitation to meet them to convey this Government’s position in greater detail and for him to better understand their perspectives, too. Also, let me reassure the noble Baroness that this engagement will not be a one-off occasion, as this Government are committed to a constructive and collaborative engagement with those affected.
The noble Lord, Lord Bew, also raised the question of Kneecap. I think my noble friend the Leader of the House responded very strongly to that yesterday, making very clear how abhorrent and dangerous the comments were. She also specifically mentioned that their so-called apology was totally inadequate, and I think that that is really important.
Despite this being a Question for Short Debate, I think we have covered as much as possible in the time permitted. I want to reassure noble Lords and repeat—I know that this is not a partisan issue and that we have been working collaboratively across the Room—that this Government are committed to supporting the victims of IRA terrorism. We will be open and transparent about our efforts, and continue to press the Libyan authorities to address their country’s historic responsibility for the Gaddafi regime’s support for the IRA.
I just want to say to the Minister that I do not think there is any fundamental disagreement in the Room about where we should be going, but we have been getting the answers that he gave on the status quo about the legalities and so on for 10 or 12 years. Whenever compensation has been mentioned, elements in Libya have attacked the group here in Parliament, attacked this country and said that it is their money and they want it back. They wanted to go to the United Nations to get the Security Council to release it. The United Kingdom has a veto. Will we use it?
I have a very strong opinion about the use of veto. Of course, the last time it was used—and it has been used very frequently recently—was by Russia in stopping an incredibly important resolution on Sudan. The United Kingdom does not use its veto lightly, and we certainly will not do that. What we are trying to do on this question is to ensure that we have collaboration, co-operation and understanding to move forward.
I will say this: when we are talking about Libya, we are not talking about a state at the moment, or a state such as Russia that has committed a breach of the United Nations charter. We are talking about a fragmented, difficult country where the people have suffered over many years. What we want to do is speak to the authorities. When we try to achieve a united and more coherent country, then we can properly address those compensation claims which the Libyan country is responsible for.
I am very pleased that the Minister said—I think—that they are still considering whether the elements of the Shawcross report can be published. On the legal issue, surely the best legal minds of His Majesty’s Government should be sitting down in a working party group with the victims’ best legal representatives—who are very good legal minds indeed, as I am sure the Minister knows—and working out the possibilities of what can actually be done without breaking international law.
I have no doubt that, when Hamish Falconer meets the representatives and others, he will give all consideration to the points made. But I repeat that this is a complex issue. I think there are big differences between the Russian Federation breaking the UN charter as a state and the current situation in Libya. It is very different. Nevertheless, we have been very clear about the need for Libya to take responsibility for the actions of its previous Government. As I said to the noble Lord, Lord Caine, we are continuing to urge Libya to do that.
(2 days, 7 hours ago)
Grand CommitteeTo ask His Majesty’s Government what steps they are taking to ensure that amputees receive appropriate prosthetics at an appropriate time.
My Lords, I have declarations to make. These are TASKA hands, and they are on long-term loan from Steeper Group. Similar, Steeper Group paid for me to attend a prosthetics conference in France just a couple of weeks ago. As ever, we owe thanks to our library facilities—both the House of Commons Library and, this time, the House of Lords Library, which provided some data for this debate.
Some 55,000 to 60,000 people attending UK clinics have some form of limb loss. We are not entirely sure of the figure. The NHS is a great organisation for collecting a lot of data, but it has not quite managed to collect the data on why people have lost their limbs, which is a little remarkable. There are a number of reasons why people may not be fully limbed or may have suffered limb loss after they were born. There are congenital reasons, obviously: people may not have fully functioning limbs. Indeed, not having limbs at all can be a feature. The examples of limb loss that we are more familiar with, of course, are those caused by trauma, such as car accidents or injuries at work.
I always ask why Leeds seem to be a centre for the whole prosthetic and limb loss industry, if there is such a thing. Leeds hospital is at the forefront of hand transplants. Of course, that is because of the industrial past of that part of the world; we may have a greater population in the south-east, but we do not have those types of industrial accident at quite the same level.
Of course, we see a huge expansion in limb loss during wartime. We saw that during the Afghan and Iraqi wars, with IEDs and mines, which are certainly good at one thing: taking limbs off very effectively. The Ukraine war, though, has come up with some new reasons for limb loss. Some 80,000 soldiers in Ukraine have lost limbs—one can only guess that, in Russia, it is a similar amount—but there is a new dynamic of antimicrobial resistance. If you get a limb injury, it should not kill you; it should just pass. However, because we have an increased amount of resistance, that can lead to limb damage and loss. Then there is the use of field tourniquets, where the urgent decision of saving life, not limbs, is taken; the limbs then die and have to be taken off.
The classic cause is diabetes; it is one of the main reasons for limb loss. When I was in my clinic, the amputee rehabilitation unit just over the river in Kennington, the classic example was that of older men who had lost limbs to diabetes—not living as well as they should, shall we say. You can also lose limbs with cancer.
However, the cause that is of great interest to me is sepsis. The trouble with sepsis is that you often lose limbs in pairs. You do not lose just one: both go at once, whether that is two legs or two arms. If you are really lucky and get the quad, you lose all four, like me. The provision of legs is somewhat easier. I am very lucky in that mine were lost below the knee, so I have knees; that makes life incredibly different. The NHS has been good at bringing forward microprocessor-controlled prosthetic knees, which are known as MPKs. They have been widely provided for some years, and people get on well with them. They have become standard kit.
So NHS provision, particularly on legs, is okay once it is on track. However, it is one of extreme delay. I can tell you the story of the legs that I am on. They are private legs. Thankfully, I have been able to get them. I am 10 months on from a cast and still have not got a leg that fits on the NHS. If I had not been able to get these privately, I would have been in a wheelchair for the last 10 months, with mental health issues, unable to go to work and probably suffering severe muscle wasting.
We have a problem in our clinics. The age profile is poor; it is old. It is not an industry that youngsters feel enthused to enter. The pay is not great, and although it may not be much more, if any more, in the private sector, that sector is growing and there is a feeling there of greater reward, greater ability to do your craft and better morale.
We have university provision for prosthetics. The two primary ones are those in Salford and Strathclyde. Within clinics that I have been to there has often been someone shadowing from their university course. However, the drop-out rates are appalling. We can look even further to the technicians, who make the sockets. It is all very well having a great prosthetist for the mould, but you need a technician. The drop-out rate there is even worse and the pay truly dire—often little better than minimum wage. As a country, we concern ourselves with how NHS provision is, particularly regarding our nurses. We have done a lot to try to improve nurse morale and nurse pay, but we have not had that same focus on the problems facing prosthetists and technicians.
This country used to have transferrable old skills. I come from north Kent and the Medway towns. I attend the Medway NHS clinic. In days of old, you would have had those transferrable skills from, say, the dockyard, which closed in 1983. In fact, they would have been greater skills of knocking stuff up in fibreglass, wood and whatever else. This would have also been true in parts of the country with car industries that have, perhaps, now gone. Those craft industries were very good at providing technicians for making prosthetics, but those days are gone.
Noble Lords can imagine my frustration that we still use those old ways, which work, of a plaster cast that is prised off and manufactured manually by a skilled artisan, yet we are short of those skilled artisans. Staff are the limitation. I hear all the time, “We’re short of staff”. There are new CAD techniques to direct 3D printing. I talk to various private companies that do NHS provision, such as Steeper Group, which I mentioned, and which is supporting me. Opcare is another. Those companies are still using those old techniques. I am trying to encourage them, if they have a shortage of people, to take people out of the system as far as they can.
If you lose one arm, you might get away with it. However, you could call losing two something of a catastrophe. I am a quadruple amputee. My worry is that we will see more people like me. My sepsis was very severe, and I was lucky to live, but years ago, if you had severe sepsis, you would simply have died. Now, with a greater understanding, greater knowledge and better drugs, you will get survivors, in states such as mine or that are even worse, yet the system is not preparing itself for keeping people alive. If you are going to keep people alive, let us try to get them on a pathway to recovery.
My experience of upper limbs is really poor. In the brief time I have, I will tell the Committee the story. One is that I was given a pair of what I can only call William the Conqueror-designed arms, with a rubber end. If you have one arm, you might get away with it, but being given two of those was the lowest part of my rehabilitation. You are then told, “Within a few months we might think about body-powered hooks”, which are straps around your shoulders—I would not be able to put them on by myself, of course, as I have two limbs missing—and you use your shoulder to open and close them. They are circa 1790. You then progress to a 1950s-style myoelectric. You have to use that for a year before you can be considered for what I have now, which people with two arms missing need at the earliest possible stage.
We have to go through those hoops. Those early hoops are paid for by the local NHS trust; my hands are paid for by NHS England. My experience was to attempt to make a discretionary appeal, as my condition is as bad as it is, to NHS England. It said, “After 10 months of trials, surely we can just get going with NHS-provided multifunctional hands”. The answer from NHS England was no, so I am very pleased to see the end of NHS England because we have to do better.
I have a final few words. If you go into A&E with a wound on your arm, the staff do not reach for a 1920s hot bread poultice; they give you up-to-date drugs, topical solutions and antibiotics. So please stop giving out pre-Victorian prosthetics.
My Lords, it is an honour to follow my noble friend Lord Mackinlay of Richborough. I thank him for securing this important debate and draw courage from the example that he sets, as someone who also lives with a disability.
As he may know, non-disabled people often use the term “inspirational” to express their admiration of disabled people. Unwittingly, they thereby place us on a pedestal. The inadvertent implication—subliminal message, even—is that they could never countenance being disabled or, indeed, think of anything worse. Apart from the fact that being placed on a pedestal, however well intentioned, can compound the sense of isolation caused by living with a disability, surely my noble friend’s experience demonstrates that disability—in his case, specifically limb loss as a result of sepsis, as he explained—can affect any of us without warning.
Being placed on a pedestal does not lessen the daily grind of living with a disability, particularly the reliance on prosthetics or, as in my case, orthotics, which I have had to wear on my legs since I was a child. As my noble friend rightly argues, that challenge should not be exacerbated by the system, yet, as he highlighted so graphically, it unfortunately often is.
This seems to be an endemic, even cultural, problem in the NHS, which, to be fair, excels at acute care, as my noble friend and I know from direct experience. The quality of acute care in wonderful NHS hospitals such as St Thomas’, where both of us have been treated, is phenomenal. Yet the failure to follow through with what my noble friend euphemistically termed in his Question “appropriate” care—in his case, prosthetics—at “an appropriate time” perversely undermines the sometimes huge investment made in one individual by inadequate and delayed follow-up care. I hate to think of how much I have cost the NHS over the years. My noble friend is more diplomatic than I am in his use of the term “inappropriate”; what a multitude of sins that word covers.
I should make clear that I do not mean to imply that our highly skilled and dedicated NHS rehabilitation teams, incorporating both prosthetists and orthotists among other relevant healthcare professionals, are at fault—on the contrary. I can speak only as someone who has benefited from the care provided by orthotists, another branch of that rehabilitation family, but I am immensely grateful for the crucial part that they have played in enabling me to keep the show on the road. By that, I mean that, after every fracture—I have had countless fractures—it has only been because of them and the callipers I wear, which they have tailored to support the very broken body in which I live, that I am here today, on my feet, speaking in your Lordships’ Committee.
So I am delighted to have this opportunity to put on the record my sincere thanks to Chris Cody and his brilliant team at the Guy’s and St Thomas’s regional specialist rehabilitation centre for their professionalism, compassion and empathy as I pick myself up, dust myself down and damn well get on with it. I am sure that the same can be said by my noble friend in terms of the pivotal role that NHS prosthetists have played in enabling him to continue both to live a full life and to perform his crucial role as a Member of your Lordships’ House.
In advance of today’s debate, I consulted a few people on the front line of the NHS rehabilitation sector. First, I will give the good news. Technological advancements such as microprocessor knees, which my noble friend mentioned, and the integration of 3D printing are making a difference, although the latter is in its infancy. Such innovations are undoubtedly welcome but—it is a big “but”—they are overshadowed, again, as my noble friend said, by workforce shortages. Indeed, one of the rehabilitation experts said:
“We are a profession at risk”,
such are the workforce constraints. Coupled with funding constraints, which have led to disparities in access to and quality of care, this is a really worrying situation for anyone who cares about value for money in the NHS. As my noble friend explained, demand is outstripping supply. There are not enough prosthetists or orthotists, which has an inevitable effect on waiting times and—quite apart from the low pay for technicians, as has been mentioned, and for prosthetists and orthotists—their morale.
So I would welcome any reassurance the Minister can give that the refreshed NHS long-term workforce plan, which I think is due in the summer, will address the critical shortage of qualified prosthetic and orthotic professionals. In case the Minister assumes that I am asking for the NHS pot as a whole to be increased, let me say that I am not. This is a question not necessarily of increasing the NHS budget as a whole so much as one of reprioritising existing resources to safeguard the cost-effectiveness of the NHS’s investment in people like my noble friend and me, precisely in order to get bigger bangs for bucks.
In conclusion, I go back to the positives and front-line suggestions on improving patient outcomes. As we know, this means greater independence, fewer hospital admissions, better mental health—my noble friend mentioned this—and more disabled people in employment and thus paying into the system. I have three suggestions. First, strengthen workforce development by investing in education and training programmes. Expanding apprenticeship opportunities and providing financial incentives offer exciting potential to attract new talent to the profession.
Secondly, enhance funding and commissioning. For example, a standardised approach to commissioning prosthetic and orthotic services could potentially mitigate regional disparities and promote consistent access to high-quality care. There are lots of amazing products and components out there, but access is limited by financial constraints.
Thirdly, we must embrace technological innovations. This is where investment in research and development and the adoption of emerging technologies are so important. If that means greater collaboration with private sector firms such as the ones that my noble friend mentioned, in the interests of patient outcomes and consistent with NHS values, that is fine.
In closing, I hope that the Minister has found or will find this discussion useful in deepening her appreciation of just how important prosthetic, orthotic and other rehabilitation services are. Neither my noble friend nor I would be here without them; they need to be nurtured, and that requires a shift in priorities. I would love to think that my noble friend might be asked to help effect that change to the culture and priority that the NHS attaches to what are, sadly, Cinderella services.
My Lords, I, too, thank the noble Lord, Lord Mackinlay, for securing this debate. I, too, pay tribute to him. What a marvellous man he is, and what an inspiration to us all. He reminds me very much of my friend, the late Duke Hussey—Lord Hussey—who was injured and taken prisoner at the Anzio beachhead in 1943. He lost his leg and the other leg was partly paralysed. He developed osteomyelitis of his spine, and the Germans assessed that he was dying and so repatriated him. He arrived in Oxford and the doctors confirmed that he was, in fact, dying.
Being Duke Hussey, he was not going to take this lying down, so he wrote to one of the most eminent professors of orthopaedics at the time and said, “Dear professor, I think you’re the only man in the world who can save me”. This professor was rather impressed with this, and he summoned him and said, “Now look here, Hussey, in this letter you said that you ‘think’ that I am the only man in the world who can save you—but I am the only man in the world who can save you”. He operated on his spine 33 times over a period of years to deal with the osteomyelitis, because the antibiotics were not available, and eventually he was cured. I never heard him complain.
Lord Hussey knew more about disability that most other people, so I got him to sit on my committee to look into the supply of artificial legs and wheelchairs, which Mrs Thatcher set up because she thought that the service was in a bad state—how right she was. I was also helped by the noble Lord, Lord Griffiths of Fforestfach. We found out just how bad the service was in terms of limbs that did not fit. It was not rocket science. With the amputee wearing his artificial limb, you could put your hand in the socket while he still had his stump there—such was the poor fit. The other thing was that they were not aligned properly. Some people got so fed up with this that they decided to have a peg leg, and then you had the alignment much better. Some of the farmers with a peg leg found it quite useful when they were planting potatoes, because they would walk down the field stamping on the ground, making a hole suitable into which to drop the potato—so it had its benefits.
We tried to get them to use modern techniques to make a socket that fitted the amputation stump, and it was not that difficult to do. One of the problems was that the companies had such a secure income that they did not bother to develop too much. I asked them what their export attempts were. They said, “It’s very poor indeed—very difficult to export”. I said, “Guess who exports to Israel?” They said, “We’ve no idea”. I said, “It’s a German firm called Ottobock”. I ask the Minister: what is going on at the moment to ensure that the limbs do fit and are aligned properly?
My Lords, I am very grateful to the noble Lord, Lord Mackinlay, for introducing this debate. When I first introduced myself to him as someone interested in continuing to be involved in the All-Party Parliamentary Group on Sepsis, because of my late husband’s experience in losing a leg to sepsis, his response was, “Is that all? Only one?” The fact that he could make such a quip to me is a tribute to his wit and humour—by the way, I did check with him before quoting that exchange in this debate. His experience puts my late husband’s in perspective, and his speech was extremely interesting, as were those of other noble Lords. Not only do I not have first-hand experience—that was my husband’s, and I was only an anxious observer and supporter—but it was a decade ago, and I am glad to hear that the development of prosthetics has moved on considerably, although whether they are supplied in the NHS is another issue.
We never knew exactly how and why my husband developed sepsis, which led, after a series of operations—to me they were, and are still, a bit of a haze—to the amputation of his leg above the knee. The surgeons tried to save the knee, but they could not do that if they were going to save his life, which they did by the skin of their teeth. I pay tribute to those excellent surgeons and all the other medical staff. The second bit of slightly dark humour I associate with this topic is that my husband was, at the time, the chairman of the Whittington Health trust at Archway in north London, and we managed to joke—at least once it was clear that he was going to survive—that it would not have been a good advert for them or the hospital to lose the chairman under the knife in their own operating theatre. You sometimes have to find humour in very difficult circumstances and, of course, strength and resilience. My husband was not always the easiest person to live with, and he would say the same about me, I am sure, but learning to use a very heavy prosthetic leg from the hip in his late 60s took every ounce of his considerable grit and determination. The noble Lords, Lord Mackinlay and Lord Shinkwin, have that in spades.
Of course, every person who needs a prosthetic is different—we learned that almost 60,000 are attending clinics—and has specific needs. Steve’s physio and training at the Royal Orthopaedic Hospital in Stanmore took place alongside service personnel who had lost limbs, usually one or both legs and usually to an IED or mine in Iraq or Afghanistan. They were, of course, much younger and fitter than him, though they had gone through a horrible situation. It would have been easy for him to get discouraged, and he tried not to, but—one thing was mentioned about the stump—he had a lot of sores on his stump, I suppose because it was not fitting or just from the situation.
I noted from the briefing that the Library kindly produced for us that there is also a veteran’s prosthetics panel, through which people whose limb loss followed from their military service can access high-quality prosthetics. Of course, service veterans absolutely deserve that, including those 80,000, as the noble Lord said, in Ukraine. But if non-military patients do not also receive the best prosthetics going, they are likely to cost the NHS more as they develop other medical problems—maybe joint, muscular or other problems. This is my first example of where I think the NHS is not doing proper cost-benefit assessments.
I shall come back to sepsis, but I want to say something about diabetes. My husband had been a type 1 diabetic since he was 21, and because type 1 damages organs and the immune system, all this was no doubt a contributory factor in his acquiring sepsis. His blood sugar control was pretty good by 2015, but it was a big fight for him to get access to the then latest technology, which would make keeping his blood sugar as level as possible a bit easier and less hit and miss than the old reliance on pinprick tests. The point is not just about the personal welfare of diabetics—though a severe hypo is horrible for the person suffering it and as a spouse, it can be pretty terrifying to deal with—but for these purposes I want to highlight the long-term costs for the NHS of not investing in the latest technology for patients. Because poor sugar control contributes to long-term complications of diabetes, and many diabetics face limb amputation as well as other devastating conditions, such as kidney failure, I have always found it puzzling that the NHS does not pursue a policy of up-front investment to stop even higher costs down the line. It may be something to do with the siloing of budgets between the GP, the hospital and specialist diabetes services.
The same applies to sepsis, from which a shocking 48,000 people die every year. The NHS ombudsman issued major reports on sepsis care in 2013 and 2023, but last September, the current one, Rebecca Hilsenrath, said she not seen the health service do enough to improve staff’s awareness of the condition and the imperative to diagnose it quickly. The noble Lord, Lord Mackinlay, rightly mentioned the threat of antimicrobial resistance, which is putting another challenge on the fight against sepsis. Dr Ron Daniels, an NHS doctor and the founder and joint chief executive of the UK Sepsis Trust, was quoted in the Guardian as saying
“Ministers need to ensure that the NHS starts giving sepsis the same priority as other big killers such as heart attacks and strokes”.
Obviously the biggest tragedy is those who die, but for those who survive—and we hope that more may do so as care improves—the care and provision of prosthetics is vital. I should say that in a Guardian article I read, the noble Lord, Lord Mackinlay, was referenced, as bionic man, as helping to raise the profile of both sepsis and prosthetics. I pay tribute to him not only for coping with his personal circumstances but making it a campaign issue for the benefit of all.
All noble Lords who spoke before me highlighted that the biggest challenge is staff. I am glad to read that bionic prosthetics, or whatever they are called nowadays, which respond to the body’s electrical signals, have been available from the NHS since 2022; that is what we learn from the briefing. I do not know whether that is general and everyone is getting what they need, and I have no idea whether that could have helped my husband’s mobility, but the more that people who have lost a limb can do, including possibly work, the less help and expense they will need, so here too the NHS needs to invest upfront. Time and again, the NHS does not join up the dots in this respect.
The last thing I want to say is about people with poor mobility trying to get around safely in the public sphere. For my husband, even the consistent provision of railings on steps could have helped. In many places, there are, quite rightly, ramps for wheelchairs, and he was in a wheelchair for a few months before he had his prosthetic fitted, but those ramps made life more difficult for him because, without an ankle joint—the leg was rigid—he could not go up or down a slope. Every person with disabilities has different needs, but just having a rail in public spaces would have helped enormously.
I conclude with what is, I am afraid, a constant preoccupation of mine with e-bikes, e-scooters, bikes and scooters. Steve found that even then, a decade ago, it was scary trying to dodge the proliferation of bikes and scooters on pavements because, if he fell, without a knee, he could not get up on his own. To me, this is another reason to stop this menace on pavements. Of course, he did not like asking for help; it could be humiliating and he was a very self-sufficient sort of chap. If noble Lords will allow me that personal anecdote, it was a reminder to me of the huge difficulties that people needing prosthetics face.
I am hugely grateful to the noble Lord, Lord Mackinlay, and the other contributors to what I think is a very important if relatively short debate.
My Lords, I congratulate my noble friend Lord Mackinlay of Richborough for securing this debate. I also pay tribute to him for his courage in the various battles he has faced in recent years, and for his determination to come back and return to public life. I have to say that I am simply in awe of him, but I hope that does not come across as patronising or putting him on a pedestal either. Based on his own experience, he is fighting for the causes dear to him, and he can talk about it in a meaningful way based on his own experience.
I also thank my noble friend Lord Shinkwin for warning us about placing disabled people on a pedestal, something that I think we ought to be aware of, and for adding the issue of orthotics to this debate, which is very important. I thank my noble friend Lord McColl for explaining his experience. I think in those days the official term was artificial limbs, when he worked on that group, when asked by the Prime Minister at the time, Margaret Thatcher. I thank the noble Baroness, Lady Ludford, for sharing her experience based on diabetes and living with someone with diabetes.
I have two early experiences of prosthetics or artificial limbs—whatever language it was, given that I was born in the late 1960s—and one is storybooks and Long John Silver. In some ways, from what my noble friend Lord Mackinlay said, the service has not really moved on from that. We talk about Captain Hook and people are still being asked to have hooks. The second experience was a friend of my brother who was deaf and had type 1 diabetes. During the time we knew her she went blind, lost limbs and sadly died far too early. I really relate to the point the noble Baroness made. One of the issues for all type 1 diabetics—I say that, having a type 1 diabetic in my family—is to look after your limbs and the extremities of your body and get regular check-ups, as well as controlling and monitoring sugar.
Having heard the speakers, I think this is a matter of both policy and principle. Ensuring that amputees receive timely and appropriate prosthetics is more than simply a healthcare issue; it is a matter of dignity, independence and fairness. Those who require access to these services are those who have faced illness, trauma and those who may have suffered injuries while serving their country in many ways. My noble friend rightly raised the issues with current NHS provision of prosthetics. In this speech, I will look at two main challenges.
First, there is the issue of the workforce, which seems ironic; I see a smile from the Minister. As my noble friend said, skilled prosthetists are not being replaced quickly enough. The provision of high-quality prosthetic care is heavily reliant on a skilled workforce. I thank my noble friend for going into the details and making us all understand the importance of that. My noble friend highlighted training deficits in the field of prosthetics and orthotics. Noble Lords will know that Health Education England has acknowledged these challenges and is working to improve the education and training of prosthetists and orthotists.
I remember, when I was a Minister, the noble Baroness who is now the Minister and others rightly raised issues about the workforce and workforce planning. After pressure from noble Lords at the time, including from the noble Baroness who is now the Minister, the previous Government eventually published the NHS Long Term Plan to address some of these workforce challenges. But in this area, if we look at the numbers, the baseline training intake for 2022 was 57. The workforce plan looked to increase that to 89 per intake. It identified that between 25% and 50% of prosthetists could be trained via the apprenticeship route as part of an expansion of apprenticeships for allied health professionals. This is, as anyone can see, only part of the solution, and there is always more that needs to be done.
Can I ask the Minister to inform noble Lords how the Government will build on some of that work? Going from 57 to 89 clearly, for many, is not enough. What work is being done and what thought is being given to increasing that capacity and to making it an attractive career? One hears about the latest technology being used, such as computer aided design, so maybe there is a way of attracting the best engineering students who may never have thought about going into that career. They may have thought about designing cars or aeroplanes, but they might realise that they could put their skills to good use in improving the health, well-being and mobility of many of our citizens.
I know that the 10-year plan is going to be published at some stage. I am not necessarily asking the Minister to tell us what is in the plan, but does she know what consideration is being given to this specific area in the plan? If so, can she share that with the Committee at the moment?
The second issue to highlight, clearly, is inequality of care. Concerns have been raised. Some noble Lords have raised their concerns around a postcode lottery of care for amputees; others have raised other issues. As noble Lords have said, there have been innovations in the technology and expansions in access. Other noble Lords have referred to the NHS providing multi-grip bionic arms since 2022, using electrical impulses from the brain to control movement and representing what is considered the cutting edge of that technology.
However, we have to confront a painful irony: we can have the best technology out there but it is not much good if people cannot get it in the first place or have to jump through a number of hoops to do so. My noble friend Lord Mackinlay spoke about the stages that one has to go through before qualifying for the very latest technology; I wonder whether we can look at those. Is there a cost involved in patients going through all those stages? Could getting them to that final stage be more cost effective? Hopefully, the technology is always evolving anyway, but could we get them to the last stage quicker, rather than them having to jump through all those stages? Is there a way of making it more efficient?
As my noble friend Lord McColl said, it is about looking at the best technology in the world. Rather oddly, I remember a very interesting man I met. He used to be the rabbi of Richmond Synagogue, and he and I got on very well. As a sideline, he started a business based on the latest Israeli technology on prosthetics. In the end, the rabbi gave up, and he and his company developed to sell prosthetics based on Israeli technology to countries in central Asia. I noticed that he is still doing that; it just shows that there is really good technology around the world. It is great that Britain could be at the leading edge, I hope, but it is important that, when you need these devices—limbs or prosthetics—you get the latest ones. It is all very well us being proud of them being built in Britain or whatever, but surely it is better to get the latest technology.
We also understand—this is one of the challenges that we faced in government—the issues of funding for a trained workforce and the extra, increasing demands on health and social care. How do we challenge those? We know that, for example, veterans have in many cases been able to receive care due to dedicated funding streams—we pay tribute to those programmes and support both their continuation and their strengthening—but we have to ask: what can be done for civilians? What can be done for children and the elderly, who face longer-term waits or limited options? In one region, an amputee may receive a personalised limb with integrated sensors; in another, in certain circumstances, they might wait months for a basic replacement. Do the Government know about or understand the reasons for some of these disparities? Have they looked into disparities and understood them, or is it simply about having the workforce in the right area? Is it about the way in which resources are allocated? What steps are the Government taking to reduce some of this unequal geographic access to prosthetics? One of the challenges when I was a Health Minister was that there were always health variances. In some cases, they were the same for all types of health, but, in other cases, it was specific to a particular health or care issue.
This is not just about prosthetics and orthotics; it is also about opportunity. It is about having the ability to walk your child to school or to return to work. It is about having the ability not just to live but to survive—indeed, to thrive—having gone through a very traumatic experience. It is important, whatever our politics, that we think about how we can empower individuals to live their fullest lives. For amputees, that power begins with access to the right limb or limbs at the right time and with the right support. Our amputees deserve no less.
I look forward to the response from the Minister.
My Lords, I thank the noble Lord, Lord Mackinlay, for securing this debate and for giving your Lordships a tremendous opportunity for a very informed and meaningful debate. Having listened as the Minister, which I did very closely—I assure noble Lords that I will also review the points that were raised—my summary is that the case is well made. The current service is not where it needs to be and we have some way to go. That has been the theme throughout.
I associate myself with the comments of the noble Lord, Lord Kamall. The noble Lord, Lord Shinkwin, also spoke about those who rely on prosthetics as well as orthotics. The fact is that they cannot play a full part, reach their potential and lead a reasonable live without the right services and support. I wanted to set out those general points.
We have heard a lot of powerful and personal testimonies today. I particularly thank the noble Baroness, Lady Ludford, who spoke of her dear late husband, and the noble Lords, Lord Mackinlay and Lord Shinkwin, for bringing colour to this very important debate. I absolutely agree that all those living with limb loss deserve the right care, as do those with disabilities, because everybody should lead independent fulfilled lives.
I was interested when the noble Lord, Lord Mackinlay, started by outlining the various reasons for limb loss—running from war to diabetes to cancer to, of course, sepsis. I have heard and understand the call, particularly from the noble Baroness, Lady Ludford, for greater attention to be given to sepsis, as it is a killer of so many.
I will make some general points, which I hope will be helpful. First, we are committed to improving access for patients to the right prosthetics at the right time. That is why the Secretary of State for Health and Social Care, Wes Streeting, was delighted to meet with the noble Lord, Lord Mackinlay, and those affected by limb loss a few months ago to hear their first-hand experiences of the services that are and are not being provided. During the meeting, the Secretary of State also heard about variation in practice across the country and the need to improve personalised care. I will come back to this point later, but the noble Lord, Lord McColl, spoke about the importance of fit, which is so obvious, but this is about getting the right thing for people’s needs. People are individuals and it is important to recall that.
The noble Lord, Lord Shinkwin, talked about the isolation for those with disability and I absolutely take that on board. The NHS in England cares for around 60,000 patients with amputation or limb difference, around 25,000 of whom are seen annually. I highlight that care is delivered in 35 centres that provide specialist prosthetic services across England with multidisciplinary teams. On the point about isolation and practicality, a multidisciplinary approach is absolutely right.
We need to consistently and fairly account for varied clinical circumstances and patient preferences. To state the obvious—I think it is worth doing so—the needs of an adult who has lost a limb caused by diabetes will be very different from the needs of a child with sudden limb loss caused by a traumatic and tragic event. It is hard, and the literal point from the noble Lord, Lord McColl, was that one size does not fit all. We need the engagement of those with lived experience so that healthcare services can meet those varying needs.
On the matter of taking action—because I think we can see that we are not where we want to be, and I freely acknowledge that—we have committed to reforming elective care equitably and inclusively for all adults, children and young people. I know that noble Lords appreciate and have identified that prosthetics are complex and intricate devices, and they have also rightly spoken about cost—and, might I add, value for money. For example, a multi-grip device can cost more than £20,000, while at the same time some 70% of patients may decide—and by that I do not mean that they decide freely but that they may be in a position whereby they have to decide—to abandon their upper limb prosthesis. Our health service has to ensure that the right prosthesis is available for the patient, not just because of value for money but because of the trauma associated with being offered a solution that just does not work. The noble Lord, Lord Mackinlay, spoke powerfully about that.
Currently, patients often wait 12 months or more to access advanced prosthetics. On the practical side, that is to ensure that they have recovered from surgery and are able to use them. However, I have to acknowledge that there are a number of cases where earlier access to advanced prosthetics is clinically suitable yet is not happening.
When it comes to action, I am therefore pleased to say that, because of the Secretary of State’s meeting with the noble Lord, Lord Mackinlay, in November, there is a review of the clinical commissioning policy relating to multi-grip hand and upper limb prosthesis. The aim of the review is to reduce timelines as far as possible and shift to a much-improved patient-focused service. NHS England is starting that work with an audit of the latest clinical data on uptake and patient outcomes. We can expect to see the result of that this summer. To the noble Lord, Lord McColl, that will of course include the matter of literal fit, which he rightly spoke of.
Furthermore, this month NHS England will issue updated standards and expectations for prosthesis care across the 35 regional rehabilitation centres. There will be a greater emphasis on services for children and young people and prenatal consultations for congenital limb loss as well.
The point about workforce came up; I think all noble Lords spoke of it, and rightly so. I smiled at the noble Lord, Lord Kamall, only because he is more than aware as a former Health Minister of the challenge that we have and the absolute need to address that issue. To improve access times to prosthetic services and get the right services in place, it is clear that we have to increase the capacity and retention of the prosthesis workforce.
I was very interested that the noble Lord, Lord Mackinlay, referred to craft industries and the fact that they are reducing and have done over many years—because of course they provided the possibility of skills and no longer do so in great numbers. But I thought that it was a very important reflection, as is the fact that prosthetists and orthotists are the smallest group, I am afraid to say, among the 14 allied health professionals in the NHS, and there are very significant staff retention issues. A report by the Health and Care Professions Council found that 12.8% leave within four years of registration.
We are faced with a small number of people entering the profession and limited places that offer the relevant degree. To put that in context, only 43 students graduate each year from a joint prosthetics and orthotics degree, of which approximately 25% follow a career in prosthetics and 75% in orthotics. I think that lays out the reality.
To address this capacity challenge, a new degree course in prosthetics and orthotics has been established at Keele University, complementing the three existing courses at Derby, Strathclyde and Salford universities. As I hope noble Lords are aware, we are working at pace to publish a refreshed long-term workforce plan to deliver the health service fit for the future on which the 10-year plan is focused. As part of that, we have a national retention programme. I say none of these things because everything is all right; I say all these things to show the direction we are taking.
The question was raised by the noble Lord, Lord Kamall, about how we attract the best engineering students to input into this field, and I thought that that was a very strong point. In addition to expanding routes and apprenticeships, and the new workforce plan, those who are eligible students can get a non-repayable grant of a minimum of £5,000 a year, and prosthetists and orthotists can get a grant of an extra £1,000 a year.
Noble Lords have spoken much about the need to harness modern-day technology and how the current techniques that are used may be out of date. I very much share the need to continue to embrace technology, including by making research grants available, and I hope we will see more activity in that.
I thank noble Lords not just for their time today but their insight and experiences. It has been a very moving and very practical debate, in my view, and one that I look forward to taking forward to get the right steps in place.
To ask His Majesty’s Government what steps they are taking to improve access to banking and finance for small businesses.
My Lords, according to the Commons Library, in 2024 there were 5.5 million small and medium-sized businesses in the UK, which was 97% of the total business population. These companies accounted for 60% of all UK jobs and 48% of all business turnover. These small businesses are the engines of job creation. Large businesses are net destroyers of jobs. These small businesses are engines of creativity. Large businesses often are less creative and frequently try to make up for this by buying smaller companies. The health of our economy and the prospects for growth are directly affected by the health of our SMEs.
The Government are well aware of this, as were previous Administrations. Over the last 20 years, there have been many studies of the SME universe, and we are not short on facts. In March, the Government launched a new consultation on small business access to finance. The call for evidence notes that, in the fourth quarter of 2023, only 3% of SMEs applied for new or renewed funding and only 1.5% applied for bank loans. This compares with 20% of SMEs in the euro area for a similar period. It was noted that, even if the approval rates doubled to over 90%—similar to those obtained before the great financial crash—the overall proportion of SMEs successfully applying for finances would only move from 1% to 2%.
The consultation closes one week from today. I hope that the Minister will consider the suggestions and observations that are made in our debate today alongside the responses to the consultation. This debate is about both banking and financing for SMEs. To take banking first, there is a growing concern about the accelerating closure of bank branches and uncertainty about whether replacement banking hubs will be able or willing to provide the services that an SME might need. The former APPG on the Future of Financial Services, which I co-chaired, conducted a short inquiry into the issues involved and will publish its final report in a week or so. I can give some sense of its likely key findings and recommendations.
The banking hub model is proving generally successful but needs accelerating. Local communities should be able specifically to request a banking hub before the formal procedures start. We also recommended that the Post Office, a critical partner, should be given the power to pro-actively recommend new hubs to LINK. As an aside, I was very pleased to hear yesterday’s announcement of the Post Office’s continued provision of basic banking services. The FCA has regulatory power in terms of access to cash, but not in terms of access to banking services. This should be remedied.
Regulation in general needs some appraisal. We strongly believe that the current FSCS limit of £85,000, dating back to 2010, is much too low. This could be artificially pushing SMEs into holding deposits with larger incumbent banks despite challenger banks offering higher interest rates and better service. I am glad to see that the PRA is consulting on raising this to £110,000 with effect from December 2025. We also believe that the thresholds that trigger increased capital requirements for lenders are set too low and are way below equivalent EU and US thresholds. We would like to see a significant increase in these thresholds as soon as possible.
There is also the issue of debanking. A significant number of businesses are debanked every year. Leaving aside the Farage farrago, this debanking merits more serious consideration. Does the Minister believe that, in general, banks are behaving rationally, reasonably and proportionately when it comes to debanking? Can he say what evidence there is to suggest that debanking is being properly justified and properly communicated?
There is a more general concern about financial stability. As traditional bank lending to SMEs is replaced by other funding sources, as it is being, what does this say about the regulator’s ability to maintain stability in the system? The former Economic Secretary to the Treasury, Bim Afolami, recently gave evidence on this point to your Lordships’ Financial Services Regulation Committee. He suggested that the growth in the proportion of credit supply to SMEs by non-bank lenders was problematic from the perspective of systemic risk and financial stability, due to these sources receiving less regulatory scrutiny in comparison to the banks. He also highlighted that this was hotter money that could flow out of the UK more quickly by comparison. Does the Minister share Mr Afolami’s concerns? What conversations have taken place between His Majesty’s Treasury and the PRA about the implications for systemic stability, as non-bank lending continues to replace more of bank lending?
Lending to SMEs overall has now fallen back to 2012 levels, according to Allica, a challenger bank. This means, according to Allica, that lending is up to £90 billion below where historic trend lines suggest that it should be. Responsible Finance, the industry body for community lenders, also notes that, for smaller businesses looking for £150,000 or less, this equates to around £11 billion of unmet financing needs each year. Both Responsible Finance member CDFIs and Allica Bank are deeply involved in SME financing. Allica is, as I mentioned, a challenger bank specialised in SME lending. Responsible Finance speaks for our CDFIs—community development finance initiatives.
My noble friend Lady Kramer will expand on the role of CDFIs in a moment, but I want to register some points made by Responsible Finance. It quotes the Government’s own estimate that around 850,000 small businesses see access to finance as a major obstacle to growth. It notes that the financing gap is particularly acute in areas of high deprivation and that businesses with ethnic minority leaders face very high barriers to finance. These people face a decline rate two and a half times higher than the average for all SMEs. Does the Minister agree that this needs urgent investigation?
In general, acceptance rates by lenders are too low. Only 47% of SMEs applying for bank finance got the funding they wanted, and the chief reason for refusal was given as current business performance, which at least has the merit of sounding rational. But 21% of applicants said that no reason was given for refusal. Alarmingly, of the businesses whose proposals were declined, few were offered the opportunity to have their application referred to an online platform. This clearly suggests that the signposting scheme is not working. This is surely something that the Government could address quickly. Can the Minister tell us what steps he might take to make signposting the helpful option it was created to be?
It is perhaps not surprising that, when it comes to service, many of our large and established banks rate well behind challenger banks. CDFIs are generally seen as quick, responsive and efficient. Service access, generally online, is seen as slick and efficient, especially if you are a start-up or a micro small business. CDFIs generate some feedback concerns that the offered product range can often be limited, particularly for larger and more-established businesses. I note that, when it comes to CDFIs, the Government deserve congratulations on the new funding vehicle launched by the British Business Bank. This new Community ENABLE funding programme will provide a much-needed £150 million in initial funding to expand CDFI lending and, handled properly, should also be an attractive vehicle for institutional investors.
I conclude by rehearsing some of the barriers to SME lending and by noting some of the suggestions for improvement made to me, chiefly by challenger banks. The CEO of Allica Bank, Richard Davies, highlighted that lending for SME housebuilding carries an RWA treatment at 150% of loan value. He suggests that this could be reduced if a domestic bank’s lending to housebuilders is, for example, no more that 10% of its balance sheet. Given the Government’s very ambitious housing target, this surely should be seriously considered. I would argue that there is no serious prospect of building 300,000 homes a year using only the few remaining large-scale builders. Does the Minister agree with that?
Last year, the Treasury Select Committee’s report into SME finance identified several key factors limiting SMEs’ access to capital. Three seemed particularly important: thresholds created by capital requirements on SME lending determined using RWA; disproportionate use of personal guarantees; and a lack of awareness of the services provided by the British Business Bank. I would add the failure of the signposting system and the urgent need to turbocharge the growth in the CDFI ecosystem.
I realise that the Minister might not have time to address all these barriers and the other questions that I have raised, so I would be very happy if he could answer as time permits and write to us about the rest.
My Lords, I thank the noble Lord, Lord Sharkey, not only for securing this debate but for an interesting and informative introduction setting out a number of important matters. I declare my interests: until two weeks ago, I was president of the Rural Coalition, which is relevant to this speech; I am also a vice-president of the Local Government Association.
I will focus my remarks specifically on the challenges for small businesses in rural areas. They hold significant potential for economic growth and are critical for our economy, but they face distinct challenges around access to banking and financial services compared to urban areas. There are over 500,000 businesses registered in rural areas, and the rural economy employs around 3.8 million people, so it is important that this economy and the small businesses that make up part of it have access to the services that they need to thrive and to contribute to the Government’s growth mission.
Some Members of your Lordships’ Committee may recall that I have, in the past, referred to the Rural Coalition’s report entitled Reigniting Rural Futures. It highlights the underperformance of the rural economy. Although the rural economy already contributes over £315 billion a year to England, with the proper investment and policy framework it could be contributing an additional tax revenue for the Exchequer of at least £19 billion. I do not know whether the Minister is aware of this report—if not, I would be glad to give him a copy or a link to it—but I would be very interested to see whether he and his officials have made any assessment of it, as I believe it is a really important contribution to this debate.
The pandemic accelerated the movement away from cash. With the banking industry keen to reduce operating costs, the way that many start-up businesses and small charities use banking services no longer fits with the business drivers of today’s banking industry. The transition to online banking is happening very fast and, in some cases, too fast for small charities and businesses in rural areas, with little thought or support to aid that transition.
Many are now operating in areas where local bank branches have disappeared. The withdrawal of banks and large financial services from rural communities is worrying but also damaging for the rural economy. Post offices play an important role in offering these services where local bank branches have closed. Recent research from Citizens Advice showed that those in rural areas are more dependent on post offices for essential banking services than those who live and operate in urban areas are, yet many local post offices have also been closing in rural communities.
The closure of bank branches and the transition to online banking hit small rural businesses particularly hard. On the one hand, this is because of the digital divide, where a lack of reliable and fast broadband inhibits easy access to online services; on the other hand, it is because, for many small business owners, access to face-to-face, in-person financial advice is crucial to giving them the confidence they need to start or expand their businesses. Many business owners are forced to travel longer distances to deposit cash and to carry out their banking, leading to reduced opening hours. For people who run small businesses in rural areas, having to drive five, 10 or, in some cases, 20 miles to another town as there is no other branch represents a hugely disproportionate burden.
I welcome His Majesty’s Government’s commitment to rolling out 350 banking hubs by the end of this Parliament. They are a great solution to some of these problems. However, 350 hubs are not nearly enough to replace the services that have already been lost. Also, the rollout is extremely slow, with it taking around 12 months to open a new hub. On top of that, the criteria by which Link qualifies an area as needing a hub are relatively strict, meaning that many small rural areas do not qualify despite their desperate need for access to banking services.
Of course, for some of those small villages and towns that do not qualify for a banking hub, post offices can—and, in some cases, do—offer a viable solution as a place where SMEs can carry out their basic banking. Can the Minister provide an assurance that this will be taken into account in the Government’s upcoming Green Paper on Post Office reform? Will they continue to mandate geographical access to post offices, including those in rural areas where they are often an absolute lifeline for businesses and communities?
Finally, I want to touch on the rural England prosperity fund. I welcome His Majesty’s Government’s announcement of £33 million for 2025-26, as well as the additional £5 million that will go towards the rural community assets fund. Yet, from 2023 to 2025, the rural England prosperity fund was £110 million. So it is no use pretending that this is not, in fact, a substantial cut in annual funding. We urgently need targeted investment, services and support for entrepreneurs and businesses in rural areas so that the rural economy can play its part in this country’s growth mission. There is a great deal of untapped potential here, but we need to remove the additional barriers and challenges that our rural SMEs are facing. I urge His Majesty’s Government once more to ensure that our rural communities are not neglected and left behind.
My Lords, let me begin by saying that I totally sign up to all that my noble friend Lord Sharkey said and by adding to the words of the right reverend Prelate the Bishop of St Albans. I listened with real interest to his discussion of post offices and banking hubs but, of course, his whole speech was significant.
I, too, recognise that the Government are sincere in trying to improve access to finance for SMEs and to encourage their take-up of financing opportunities. We do business start-up well in the UK. Although equity capital is harder to come by here than in the US, start-up capital and even growth capital are not, I suggest, our primary problem. Most small businesses are wary of outside equity as it dilutes control. They know that most outside equity intends to sell off the business sooner or later. I would argue that our biggest problem is the lack of availability of debt finance for SMEs, whether that is just to acquire a second van or for a major scale-up. Scale-ups hoping to grow speak of a valley of death as loan opportunities, particularly for unsecured debt, seem to disappear just as they are needed.
In their consultation document, the Government identify the many new challenger banks and alternative finance providers that have come into and now dominate the SME debt finance market. However, I am clear from conversations with groups such as Responsible Finance, but also the British Business Bank, that these new players are essentially offsetting the sharp drop in debt financing offered by the high street banks. The total pool of lending to SMEs has not grown. In addition, the bank referral scheme, to which my noble friend Lord Sharkey referred, for those SMEs that are turned down by banks, is turning, quite frankly, into a bit of a dud at the moment. The British Business Bank has also made significant efforts to fill in this gap, especially with programmes such as its growth guarantee scheme.
I am delighted with the recognition that the British Business Bank has now given to the capabilities of CDFIs—community development financial institutions. These are typically not-for-profits in deprived areas or areas of modest income, whose only purpose is to serve the local community and its banking needs. The BBB’s community enable fund will support £150 million in lending to SMEs via CDFIs over the next two years, with money from the Department for Business and Trade, but the scheme is then intended to grow as private partners join the fund. Challenger banks such as Unity Trust and Triodos have also invested in CDFIs, as have, more recently, Lloyds, NatWest and JP Morgan Chase, but the problem is scale. That is why I propose that the Government should look again at their CDFI policy and at the template of the United States.
In the US, community development financial institutions—primarily community banks, but also credit unions—are the backbone of the economy. As we speak, they have outstanding $304 billion in loans, primarily to small businesses. They have been the instrument through which the US Government have supported small businesses during financial crises and recessions, avoiding the pitfalls of the random financing that the UK was really forced to offer through its loan schemes during Covid. That is because CDFIs know all their customers, so the same level of fraud is nowhere near experienced in the United States. Their role in cushioning the US economy continues, and it plays a crucial role in the resilience and growth of small businesses, which then go on to feed larger businesses. US CDFIs are usually not-for-profit but, despite lending to many customers who could not qualify for loans from mainstream banks, they typically have lower default rates than the mainstream banks.
It was not always thus. The use of CDFIs to fund small businesses was a result of the Community Reinvestment Act 1977. It was a civil rights measure to counter the decision by mainstream banks to redline deprived and ethnic minority areas and to refuse to lend within those boundaries. These mainstream banks were, in effect, required by the regulators to lend to all communities or put funds into an entity that would—hence the CDFIs. By 1997, there were roughly 200 CDFIs in the United States. The Clinton Administration decided to back their growth with a federal fund, and today the number is 1,400, typically in areas of deprivation or middle-income areas across the country. They have the mission and the staff to connect with their communities. I have visited CDFIs and met the civic societies that they use to enable small businesses to understand business plans, accounting and marketing—in other words, to become bankable and a success. Mainstream bank officers at the highest level vie for places on the boards of CDFIs, such is the prestige. Indeed, mainstream banks now look to CDFIs to develop their future customers. Angel investors engage regularly with CDFIs for exactly that same reason.
Responsible Finance has been arguing for years that we need a UK community reinvestment Act. It is right. We are simply missing a layer of community banking from which the high street banks have withdrawn, leaving a space that no one else has properly filled. The British Business Bank funds 41 CDFIs—yes, 41—versus 1,400 in the United States. That is woefully inadequate. The collective CDFI loan book in the UK is approximately £100 million. That may sound respectable until you look at, again, $304 billion in the United States, as I mentioned earlier.
This tells us in volumes that there is huge scope in the UK to grow the existing CDFIs and add to their numbers. There is potential to look for opportunities to combine CDFIs with banking hubs, which at present, as the right reverend Prelate described, provide limited banking services—mainly access to cash—in areas without a bank branch. Those hubs are now contemplating their medium-term and long-term futures, so they are very open to new ideas and new possibilities.
The British Business Bank could use the ENABLE fund—that mix of government and private funding. Beginning to push forward such a programme would require enhanced and greater funding, but it seems to me that it is a viable strategy. I also see no reason why mainstream banks should not be required to contribute, as they do in the United States. It could be required as part of the price for closing branches.
We have tried pretty much everything: challenger banks, alternate banks, open banking, bank referral schemes and support from the British Business Bank. Nothing has reached the scale required. Community banking is a necessary pillar for communities; it keeps alive high streets, is the beginning point for entrepreneurs and is absolutely key to oil the engine of growth.
So if growth is the Government’s agenda—they are very firm that it is, and it is certainly our agenda—the growth of small businesses is absolutely vital. A layer of organisations to provide the necessary debt financing is simply missing. It is time to seize the day, as the United States once did.
My Lords, I thank the noble Lord, Lord Sharkey, for bringing forward this debate and for his continued focus on, and interest in, banking services in this country. I also thank the Minister for hosting this debate and for his dedication in doing so in the last slot in Grand Committee just before the holiday weekend. I welcome the opportunity to contribute to this debate today, because this is an important and pressing issue relating directly to the wider challenge of growing the economy.
Small businesses are the backbone of the British economy. The DBT reports that 61% of people employed in the private sector work for small businesses. The Federation of Small Businesses reports that small businesses contributed a turnover of £1.8 trillion at the start of 2024. These organisations matter deeply.
Given this, we are proud of the steps taken by the previous Government to support small businesses, such as the formation in 2014 of the British Business Bank—which continues to be supported by the CBI and the BCC—as well as small business rates relief, the start-up loans scheme, and of course the Coronavirus Business Interruption Loan Scheme and Bounce Back Loan Scheme, which protected small businesses during Covid. Small businesses were also affected by the debanking issue, which has been partly addressed by the FCA, as was raised by the noble Lord, Lord Sharkey. Maybe we could also ask the Minister for his observations and the progress on that.
However, despite these welcome steps, it is evident that small businesses are operating in increasingly difficult economic conditions. Noble Lords across the Committee are well aware of the challenge inflicted on small businesses by the Government’s decision to increase national insurance, alongside minimum wage changes. The Institute of Directors said that this will cause small businesses “precious little” other than pain, and Hospitality UK has said that the policy will be a “brake on growth”. Can the Minister assure us that this Government will keep this area and impact carefully under review?
As we have heard in the discussion so far, small businesses struggle to access banking and financial services. This is an issue that noble Lords have touched on before. I note the welcome debate initiated by the right reverend Prelate the Bishop of Newcastle on bank closures to rural communities—issues picked up again by the right reverend Prelate the Bishop of St Albans today. Points were also very well made about the importance of banking hubs.
Several factors led to the present state. Small businesses are a perennial problem for banks, partly because many of these businesses are very small and may fail after a few years. The sector has never been profitable for banks. Small businesses tend to start by using retail accounts, before moving to business accounts, and lending would normally be in the form of a one-year revolving credit facility and, less commonly, five-year loans. However, both have very high defaults, hence the reluctance by banks to lend.
Banks are very familiar with this problem. Noble Lords may have seen the letter sent by the bank bosses to the Chancellor over the weekend that highlights some of the challenges the banking sector faces in supporting small businesses, among other banking services. Does the Minister recognise the position outlined by the executives in that letter? In practical terms, bank capital regulations mean that traditional lenders are deterred from lending to small businesses. The higher collateral threshold mean that banks prefer low-risk property-backed loans. These criteria do not match up with the needs of modern, service-orientated small businesses with limited tangible assets.
The other effect of the regulatory framework is the burden that it places on banks in compliance costs. This again deters banks from operating in low-margin geographies where small, local branches may not justify the capital cost. As we know, 63% of branches that were open at the start of 2015 have since shut. The numbers are headed below 1,000 and many people will have very limited access to any kind of branch. It is important to mention that access to branches is not just access to credit but access to advice. It is someone to talk to and understand what financial services can provide to your business.
Allica Bank, as mentioned by the noble Lord, Lord Sharkey, estimated this week that there remains a substantial SME credit gap of up to £65 billion. Clearly, it is just an estimate from one source, but this kind of credit opportunity is enormous in terms of the importance to SMEs in this country and an opportunity in the loan market for small businesses. Technology may offer a partial solution. There has been a rise in non-traditional lending, making up some of this shortfall. However, these non-traditional lenders come with their own risks, meaning that they are not always appropriate sources of capital. These lenders are often riskier, with lower due diligence standards, and several challenger banks are not yet profitable.
Given this credit problem and the importance of small businesses for employment and growth, this situation needs addressing. The Government announced a financial services growth and competitiveness strategy at the end of last year, although it has not yet produced any report or strategy. Can the Minister update the Committee on when a strategy will be forthcoming? The swift publication of the Government’s strategy would be a welcome signal to this community that its needs are being considered, with possibly regulatory adjustments to maximise their capacity to grow their businesses and grow our economy.
My Lords, I am grateful to the noble Lord, Lord Sharkey, for securing this debate and for his thoughtful and comprehensive contribution on the future of the SME sector. I am also grateful to the right reverend Prelate for his contribution. I look forward to receiving a copy of the report that he mentioned. I also thank the noble Baroness, Lady Kramer, and the noble Lord, Lord Altrincham, for their contributions. As everyone agrees, the SME sector is of critical importance to the UK economy. I am also grateful to have received interest from beyond this Room from Allica Bank and Creative UK.
SMEs account for the vast majority of all businesses and the majority of overall business turnover and employment. SMEs remain the backbone of our economy and the key to our prosperity. They drive the UK’s growth and employment. The Government are committed to supporting their access to the finance and services that they need. This is why provision was made in the Autumn Budget to support the British Business Bank to invest over £1 billion across 2024-25 and 2025-26, to enhance access to finance for small businesses. This includes over £250 million each year for small business loan programmes, including start-up loans and the growth guarantee scheme.
The Government also announced in December last year a new business growth service to make it easier and quicker for SMEs to find government advice and support, all under one roof. Last month, we published a call for evidence on SME finance. This work will feed into the small business strategy, which is due to be published later this year.
I should add that the Government’s call for evidence on SME finance also highlights the important issue of the underserved, including the role of community development finance initiatives in the UK in helping minority groups to access finance. It would be good to understand more clearly what sits behind the headlines and what is driving the financing gap for the underserved.
The Government are also taking steps, however. The British Business Bank’s Community ENABLE fund, which has already been mentioned and was launched in November, aims to increase the availability of funding to social impact sector lenders and the smaller businesses they serve in local communities across the UK. The initiative is expected to provide a significant boost to the sector, supporting up to £150 million of lending over the next two years.
The noble Lord, Lord Sharkey, highlighted in detail the lack of demand from SMEs for credit, as outlined in the Government’s recent call for evidence on SME finance. This underscores the importance of government efforts beyond the vital schemes of the British Business Bank. The Government’s planned business growth service to strengthen SME advice and support is an important intervention in this space. It complements other schemes such as Help to Grow: Management, which provides SMEs with the skills needed to manage finances and innovate effectively.
The noble Lord, Lord Sharkey, also raised the issue of signposting a business declined for credit to an online platform to help match them with alternative credit. This refers to a 2016 government initiative known as the bank referral scheme. We recognise that the scheme is not working quite as intended; that is why the Government will consult on the scheme later this year.
Stepping back from the detail of individual policies, I recognise the acute macroeconomic uncertainties currently facing businesses across the UK and globally. This uncertainty has intensified in recent weeks as a result of global tariff policies, causing anxiety for small businesses around whether they can continue to access the finance they need. The Government have taken decisive action here by unveiling significant measures, including increasing UK Export Finance’s ability to provide financing support to British exporters by £20 billion.
The Government recognise the value of the British Business Bank and the vital work that it carries out to support SMEs. The growth guarantee scheme supports smaller businesses as they invest and grow by providing a government guarantee of 70% to lenders for loans of up to £2 million. The guarantee reduces the risk to the lender, making financing more accessible where credit would either be declined or available at a prohibitive cost. It supports a wide range of finance including term loans, overdrafts, asset finance, invoice financing and asset-based lending. The future shape of the growth guarantee scheme will be determined at the spending review, which is due to conclude in late June.
Recognising the critical importance of access to banking services and concerns around debanking, the Government laid a statutory instrument earlier this week to strengthen how customers, including SMEs, are treated when a bank decides to close a customer’s account. The FCA has undertaken research looking at the drivers and rationale for debanking; it found no evidence of this being politically motivated.
The Treasury’s call for evidence on this topic revealed that there were still a number of deficiencies in the current rules. This includes customers not having enough time to make alternative banking provision in cases of bank account closure or not understanding the reasons for their provider’s decision. The new rules will give customers more time to challenge decisions they disagree with and find a new bank if their account is closed. Specifically, the new rules extend the minimum notice period before bank accounts can be closed to 90 days, which is higher than the protections in other jurisdictions—including in the EU. Additionally, we have mandated that providers offer a sufficient explanation for account closures and outline the process for lodging complaints.
On physical banking presence, which has been mentioned, especially for rural areas, I recognise the importance of banks, or equivalent banking services, being readily available on the high street for SMEs and the concern about the loss of relationship banking in the digital age. That is why the Government are actively supporting the rollout of banking hubs, with a commitment that at least 350 will be established by the end of this Parliament; about 140 have already been opened. These hubs will enhance access to banking services, including in underserved areas, ensuring SMEs can continue to contribute to our economy. The process for requesting a hub is an independent one, carried out by LINK, when a cash service closes or there is a community request to examine if a hub is warranted.
According to the FCA’s 2022 Financial Lives Survey, in the 12 months to May of that year, just 33% of adults with a day-to-day account carried out banking activities face to face in a branch, down from 63% in 2017. In respect to what the right reverend Prelate said about rural areas, we obviously recognise the importance of access to banking, the challenge with rural areas and the importance of the Post Office, and 99% of the UK population lives within three miles of a Post Office. I cannot say anything more about what will be happening in the spending review in relation to the Post Office, but for access to cash the FCA rules state that 95% of people must be within three miles of a cash facility in rural areas.
A number of issues were raised about whether the UK’s regulatory regime is appropriately calibrated to support the real economy and financial stability. Looking carefully at the impacts of regulation is important and consistent with both the FCA and PRA being given secondary objectives designed to ensure that the impact of regulation on the UK’s growth and competitiveness is carefully considered. We must also be careful not to overlook why regulation was strengthened in the UK and globally following the financial crisis and the importance of ensuring that banks are adequately capitalised.
To answer some of the questions from the noble Lord, Lord Altrincham, the banking sector is critical to delivering a number of priorities for economic growth. That is why the Chancellor has asked for a new approach to regulation that supports growth, instead of excessive focusing on risk, and why we are codesigning the first ever financial services growth strategy with industry. This Government’s plan for change will raise living standards across the UK, putting more money in people’s pockets.
On capital regimes, supporting UK economic growth and competitiveness was a central consideration for the PRA, part of the Bank of England, in finalising its Basel 3.1 package. Basel 3.1 is about the capital framework in the UK. The PRA’s final package included a new SME lending adjustment to ensure that capital requirements for lending to SMEs would not go up as a result of Basel 3.1. This was a material improvement to the PRA’s original proposals, which inadvertently would have increased capital requirements for banks’ SME lending. To the specific question about thresholds protecting bank deposits here in the UK and the importance of protecting SME deposit customers, noble Lords will be pleased to hear, as the noble Lord, Lord Sharkey, has already pointed out, that the Bank of England is currently consulting on raising that limit, which currently protects £85,000 of bank deposits, to £110,000.
A question was also raised about the shift in the provision of credit in the UK’s financial system away from traditional, large banks and whether this was a risk to the UK’s financial stability. I would be keen to stress the importance of competition and diversity of credit here in the UK and the value of credit being provided by smaller and specialist banks. These provide much needed finance for the real economy. Challenger and specialist banks now provide 60% of gross lending to SMEs in the UK. This increase in competition and diversity of finance offers benefits in reducing reliance on a small number of lenders. This may improve the resilience of the system to continue to support the economy in times of stress.
The FPC is very focused on the role of non-banks in the financial system and wider economy, with the sector becoming an increasing focus in its publications. The non-bank sector provides 56% of the total £1.4 trillion stock of corporate debt and has accounted for the entire increase in stock of funding to the real economy since 2007.
It would be remiss to close this debate without acknowledging past failings in the treatment of SME business customers by their banks. This includes but is not limited to historical interest rate hedging products. Understandably, these episodes affect trust and caused anger following the financial crisis. Therefore, the FOS now has jurisdiction over 99% of business banking disputes, creating a much wider safety net for businesses. This is and remains a genuinely important step in ensuring the protection of SMEs. More widely, the Treasury and FCA continue to monitor the adequacy of the regulatory perimeter for business finance. In this, we aim to balance protecting SMEs with the risk of increasing the cost of accessing finance as a result of extending regulation too widely.
This has been a really good debate, and SMEs are seen by the Government as one of the driving forces of the economy going forward.